The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1878-09-11

svmpathies and generous judgments WIFI
make society honest and sincere, and the
ioys OF this world worth living for
Editors Dispatch: You have discussed
tba financial question OF the day with I'M
,snoj ability, and while have no doubt a
Great majority Of thinking people agree
with YOU in the main, yet there are one OF
two difficulties involved in the question tpat
seriously affect the interests OF the people
Of this State which you have notiuliy en-
pIaincd how to overcome. l, III coininuu
with MANY others, would like you 10 reply
to the following: ..uo,,,o,;o,
in this State to meet the wants OF Tue pEo-
nles n not, how would you supply the
deficiency? o,,o,
,oroeIv Increased in volume, would NOT tue
relief Il might afford be only temporary be-
cause OF the obvious tendency OF money,
current in every part OF the country, to ma
it's way and stay, in undue preponderance,
in monev-centres Is net this condltloh
indispensable from our present system
3. Looking at the matter IN tnls nsus,
which seems with many to DC :tne COREY
LIGHT, is not a repeal Of the tax on lndepena-
emit banking and q reinauguratlon OF our
old State-banl1 system the only permanent
remedy for the evils from which we suffer !
:, 4. Would not the capital now employed
in banking in this State buy gold enough
for a basis of circulation that would afford
us three times as much good money tDan
we have at present? a. ,. d.
-......... ..-........- ANSWERS. .a.: =
/, There is not enough capital in Vtr-
ginia. Before the war we had the accumh-
lated wealth Of hundreds OF years, almost
all OF which was lost. That IS to say, we
have not things OF any sort that will buy
money. But we can't make money OUT OF
paper. We must accumulate property as
our fathers did. Let our correspondent
ask himself whether the Government could
make money as good as gold out OF iron by
its tiat.' Nobody will contend that it
can. Or course, then, it can't make 1t out
OF paper. The gold behind the paper Is
what makes the latter good.
9. We answer this question in tue affirm
alive as to its first clause-to the word ''tem-
porary,''-and in the negative as to its sec
ond clause. Money goes wherever there is
anything to buy it with. II there were not
q bank in Virginia, there would probably
be not one dollar less OF currency in the
State, after dcducting the amount not used
by the banks, but kept on band. Dir. PAUI/s
idea that the notes issued by the Virgil
mia banks constitute The whole currency OF
the State is peuri.e. If it were true, not
only every State, but every town, city, and
county would have to have its own banks
and its own currency. State lines are ina
einary lines SO far as national currency is
concerned, whether this currency be gold,
or silver, or bank-notes, or sreenbacks.
8 and 4. Under the old State-bank system
the bankerreceived about is per cent. inter-
est on his capital. That is to say, he issued
three dollars of notes for every dollar OF CAPT
tai be paid into the bank. That sort OF money
was very good and very cheap when we had
the accumulated savings of hundreds OF
years in hand, and so were able to establish
banks having each three or four millions OF
dollars Of capital. The expenses were but
a small percentage of the profit. But in
small banks-the only kind we are now able
to bave-the expenses for rent, taxes, insu-
rance, officers, clerks, &C., render it out OF
the question for the bank to lend money at
six per cent. So that IL the people were
willing to return to the old system it would
be impossible for them to do it. They lack
capital, not currency. They lack something
to buy money with. But even il the State
banks could be reestablished in thor ante.
bellum magnitude, we do not see how men
could get money from them who could not
give good personal security; and all men Of
this class can get money now. How.
ever, we vastly prefer the old State
bank system to the greenback deluslons.
Our fear is that we shall lose our present
banks and get no substitute. Every Dor
rover will have to pay up. All deposits
I must be withdrawn. The banks will close.
Aud there will be no banks OF issue left. 1t
is evident from the extract from Mr.. THUR
MANS speech which we published last week
that he has no idea that State banks will
ever be reestablished, or, at any rate, any
State banks that will be permitted to issue
notes. In the North they have an abund-
ance Of capital, and will not lack for banks.
In the South, we may be left without any.
We have a notion that our correspondent
needs no instruction. He understands the
financial question himself. We answer his
questions for other peoples benefit.
Editors Dispatch: II the United States
bonds, on which large amount of interest
is paid annually. were called in, would not
the saving Of the interest and the amount
OF currency thereby put in circulation go
far TO help us out OF the present stagnatIon
as L,,cisaasS2 In Of her words what ettect