New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1878-09-03
yLUcyU1TIoEs or CURRENCY

The monthly statement Of the Controller Of
the Currency is chiefly interesting because
it shows that gradual expansion of bank
circulation has commenced. 1t Is true the
amount retired by the Treasurer during the
month of August, $914,597, together with the
amount surrendered, SOL $40, exceeded the
amount issued upon Tequisition from banks
increasing circulation. But the movement
toward expansion has nevertheless COM
menced, for, while the banks took out new
circulation during the month amounting
to $G08,O1O, they deposited legal-tenders
amounting to only $29S, 900 for the redemD-
ton or retirement of circulation. and this
sum, with the S151,5 $40 surrendered, is
smaller by about $4,000 than the amount
issued In any point Of view, tho change
during the month was unimportant in amount,
but it is significant as an evidence Of the
readiness with which any increase in the de-
mand, however slight, is answered by the
operations of the present system.
If the country had q circulation composed
OF greenbacks only, rs the Democrats and the
Tramp party propose, ii would not be posi-
bic thus to adapt its volume TO the changing
needs Of business. A new demand springs up
in August, for example, but it cannot be met
by any action of Congress until December or
January, even if that body does not spend
six months in wrangling about it. So a pleth-
ora of circulation, which is now speedily re-
lieyed IN some measure at least, by the vol
uniary retirement of notes by the banks,
conld only DO authorized by an act of Con-
gross, perhaps six months or a year after the
III The tnnutblu
ports of the Controller, moreover. call atten-
ton to another important feature in the case.
The greenback circulation, by ITS very nature
tends to concentrate in the chic commercial
cities. while the bank notes are more widely
retained in use 10y the people, and it often
happens that the circulation is found su-
perabundant in some localities, at the
very time when banks Of other sections are
rapidly expanding their issues. Thus the
present sy stem tends to adapt the supply Of
currency to the demand, not only in the
aggregate, but in each section or locality
where National banks exist. Thus. Pcnnsyl-
wanna banks increased Their circulation $780,
600 last month"; and those of Maryland $50, 900,
while West Virginia banks reduced their
circulation $64, 700; North Carolina banks in
creased SOS, 800, while Kentucky banks de-
creased $45, 900, and banks of other Southern
States smaller amounts. So at the West the
retirement of notes exceeded the issue in Iowa
by $4,000, aud in Indiana by 100000, but
in Illinois the issue exceeded the retirement
by $50, 500, IN Ohio by $4,000 and in Mich
igan by $3S, 800. In all the Eastern States the
issue was slightly increased, if changed at all /;
in Massachusetts by $Sl 500, in New York by
$50, 100, and in other States by smaller sums.
These are illustrations of the perpetual adj
instmcnt and readjustment of crcula-
ton to local wants, which the Ma
tiOnal banking system produces. No other
has ever been devised which could with
equal pr0mptness and certainty meet any local
change in the demand for currency. 1t is
marvellous that the opponents of the banking
system find it impossible to recognize this
fact because their loudest and most frequent
demand is for a currency adapted to the
wants of trade.n So far as this phrase has any
meaning whatever, 1t applies perfectly to the
bank currency, and applies not at all to any
other yet devised rs a substitute for coin. No
device can enable Congress to meet with
prOmptness or accuracy the wants of diff
ferent localities, and thore is not a man in the
country who would dare to intrust
such power to Secretary of the
Treasury, or to any other official.
The proposed intercOnvertibe currency. to
be issued in any amount desired to those who
may happen to have Government bonds bear
ing 3.65 per cent interest, besides being most
dangerous. on account of Che violence and
suddenness of changes which it would cause,
must also prove, II tried, peculiarly injurious
TO the peoole Of rural districts. and especially