The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1878-09-10

/ .....srfrgr : ti0uaa Banks. "a ".-
Extract from Speech Of Hon. John Coburn ut No.
blesyillc, Ind, August 3Otl.I III.
It Is, urged by the Democrats that we
must destroy. the national banks and issue
in lieu OF their notes greenbackS. 10 do
this would very greatly unsettle business,
would compel the banks to close up their
present business very largely, would bring
about a calling in and stopping OF loans,
would possibly bring upon tic country a
panic and the. most fatal arrangement OF
business. The deposits in these banks will
average double the amount Of their circula-
ton, and their loans cover As great an
amount. Unsettlc all this, and require the
banks to redeem their bonds and quit bust
ness, and no one can guess 1t the result.
No experiment could be more dangerous.
/ - NATIoNAI-BANK CURRENCY CHEAP.
1t is said the national banks derive dou-
bic advantage from their bonds and notes,
receiving interest on both, and so enjoy an
unusual monopoly, which ought to be de-
stroycd. Now. is there anything in this
In tue first place, what is the object OF the
deposit OF bonGs in the Treasury OF the
United StatesS II is to secure the bill
holder, the. people who use the currency,
and it is for nothing else. The banker only
does it upon compulsicn, because the law
requires it to bedone before he gets his cir
cuiaton. Suppose the banker WAS required
to keep the bonds on deposit in his own
bank. and to exhibit them upon demand TO
any Government inspector, would the case
be difiercnt?' The only difference would be
that the security wouldnot be quite as good
as it is now. He pays bis money for these
bonds, and lie has arg ht TO the interest on
them. This iSa fair transaction. But then
he gets the Dational-bank notes for ninety
per cent. OF these bonds, and there's the
rub. He can lend these notes and get dou-
BILE interest. But suppose, instead OF na-
tionaL bank notes, lie issued bis own notes
from private Dank-such as we had be-
fore the war-would he not then get his in
terest both OH the bonds and on the notes
Would lie not, as he did then, issue three
for one, and put out, instead CT ninety
cents to the dollar, three dollars for one
At all events, he would get interest on the
bonds and on the notes just as he does
now, and his notes would have but local
credit and inferior, sccllritY-a security that
the banker could pick up and run away
with any day, and thus utterly destroy the
value OF the notes.
Suppose, instead OF a banker issuing his
circulation upon the security OF ms bonds,
he issues them upon the credit OF his real
cstate-his farms and his city property.
Would it be wrong for him TO collect the
rents OF this real estate, and also collect III
terast On the money, the circulation he
loaned?
And now everybody knows that banker
to inspire confidence must have property OF
some kind-land or money or bonds or
buildings. What harm is there in that!
One would thiuk. free from prejudice, that
Il sIo, lie fin 1frn
money he had, the better for the note
holders, the better for the people The TACT
that they are Government bonds does not
alter the case. The Government must pay
interest on all its outstanding bonds, and
paws the same rate to the banker it does to
the farmer or the laborer-not 4 cent more.
But it is said, Why not let the Govern
mcnt furnish the currency, and so save the
interest entirely? This looks plausible at
the start, but must not the Government
have some security for the billhoder as well
as the individual. Must not the Govern
ment have OIL hand some coin with which
to redeem these notes, and will not THIS De
n slim equivalent to the notes! And so
there will lie idle in the Treasury an
amount OF COLI which should bring inter-
est. and which the Government loses, just
exactly Us great as the interest on the bonds,
unless the Government issues what IS called
fiat money and refuses 10 redeem it forever
more The only way in which you can
have cheaper money than national-bank
notes is to issue tiat money. Grecnbacks,
legal tenders, promiSins-to-pay dollars, W!ll
not answer.
But. after all that is said OF the large
amount of notes which the banker obtains
TO lend, the law requires him to keep re-
serve in his vaults OF from fifteen to twen-
tv.iive per cent. for redemption. lie gets a
circulation of from sixty to scYenty-tive per
cent. OF the face OF his bends that he can
use. Many sagacious bankers on this ac-
count will have nothing 10 do with national
banks. .:,r- q. = <--r,I ..:!.
Let it be remembered that greenbacks
benr no taxes, and national-bank stock pays
many millions.
:, We are unable to see how the country Is
to be benefited by an unlimited issue Of
greenbacks, as advocated by. some Of the
press. The remedy lies not in the quantity
of, currency you circulate, but i'll the stabili-
,pd hinnnSe NJ tho ntrau.