The true northerner. [volume] (Paw Paw, Mich.) 1855-1920, 1878-08-30
A CATECHIsM IN FINANCE.

CdI ECn4oM IN fANaNSG'
G, What 10 government bond? A. Aprint-
cd obligation Of the sovsrnmsnt to pay GER
tain number Of dollars with interest.
Q. What is . gresnback? A. A government
note promising to pay the bearer one or more
dollars without interest. 4 u
Q. WHAT is a dollar? A. A United States
government coin worth one hundred cents.
Q. ia man takes mp his own note, and gives
a new note OF his own making for the old note,
is the debt thereby paid: A. 1t is not; the
obligation is renewed, but not paid.
@. II the government takes up one form of
its obligation and gives another for 1t, is the
debt thereby paid'e A. 1t is not the obhga-
ton to pay is renewed in another form.
O. Can the government pay its bonds in
Qreenbacks? A. 1t cannot. any more than a
man can pay his own note bv giving new note
for the old one.
@. IA. holds BIS note, drawing interest at
six per cent. per snnum, and b., when called
upon for payment, should offer to pay his note
to A. by giving bim new note drawing no
interest, what would all honest men think OF B.
and his proposition? A. They would think
that B. was either fool or a knave, and his
proposition the emanation OF weak-minded
or dishonest man.
@. greenback being government note
promising to pay dollars, what gives it value
A. The general belief that the government
will fulfil its promise.
@. Why is the greenback worth more now
that during the lat e War Of the Rebellion? A.
because Of the near approach Of the time when
the government will fulfil its promise, and the
belief that the government will be able to pay
in coin all OF the greenbacks that will be pre-
sented for payment after the first day Of Jsnu-
airy, 1879.
@. How much would it add to the value Of .
greenback II the government would receive
them in payment Of custom duties? A. Not
more than from one-hsK to three quarters Of q
cent on dollar at the most.
O. IT, during the late War, when greenbacks
were worth thirty-fve cents in gold coin, the
government had passed law making them
receivable for custom dnties, would that have
made greenbacks worth as much as gold? A.
1t would not such law could have increased
their value but few cents on the dollar at
most
O. What will make greenbscks always worth
Nal tha,x
able IN coin on demand.
@. Can il be done IN any other manner? A.
It cannot for any great length Of time.
Q. What Is money? A. Com.
Q. Has not the government the power to
make money by law, and keep it equal with
com? A. 1t has no power to make money OF
paper, or to keep paper equal In value with
coin, unless 1t be exchangeable for com.
Q. Is not greenback money? A. 1t is not
money; it is promise to pay money.
Q. Is not gIeenback just as good as CON- il
made legal tender for all debts A. 1t is not
there are other uses for money besides paying
debts, and unless greenbacks are TO be payable
in coin, they must necessarily be at discount,
greater or less, according to circumstances.
Q. Is there enough paper currency in the
country? a. There is.
O. How can we tell when there Is too much
paper currency IN the country? A. When
there is 10 coin in circulation, it is an indica-
ton that there is too much paper ahoat. When
there is too much paper In circulation. it be-
comes deprecated in value below coin. and the
coin is boarded.
Q. Why did the Government pass law re-
fusng to accept greenbscks and demanding
payment OF custom duties in coin? A. Be-
cause the government needed the coin to pay
the interest on its bonds, and this was the
simplest and easiest way to get it. And Con-
gress, during the war, did not want to place
itself at the mercy OF the gold gamblers every
time its payments of interest were due.
Q. Why not pay the interest on the Govern
ment bonds in greenbacks? A. Because green
backs are not money, and the Government
must in the end pay money for its obligations,
both principal and interest. 1t cannot honestly
forever refuse to pay its obligations and con-
tinue exchanging one obligation for another,
for all time.
O. II tho national banking system was des
troyed, and the government issued all the paper
currency Of the country, the amount being
equal to that Of its bonds issued since the COM
mencement of the late Civil War, what would be
the result? A. The country would be flooded
with deprecated paper, prices Of everything
would be unsettled, confidence and credit would
be destroyed, fortunes would DO made and lost
on paper, all coin would be boarded, and all
shrewd business men would prepare for the
final crash which would be inevitable sooner or
later.
Q. Why Is not greenback, based upon the
resources Of the nation, the best paper curren-
cy in the world? A. Because it is based simply
on the policy and will Of political parties in
Congress assembled, and in the event OF the
policy Of Congress being controlled by those
who once fought to destroy the country, the