New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1879-08-09
THE A B G OF FINANCE.

nrst had being, ana cursed themselves DIV the
issue Of bad notes. After them the Continental
Congress tried TO make it's notes good by iat.' IL
enacted that. If any man refused to take those
notes. he should be treated as enemy of his
country and outlaw Men did not refuse. But
-four became worth 800 barrel and salt $50
bushe and the Continental paper funded at
last at the rate of cent the dollar. Then for
seventy years notes of Stse banks flooded the
country aud robbed the people. The civil war
brought with il legal-tenlers worth less tnan forty
cents the dollar. Since it closed, for nearly
fourteen years have been dealing in a money,
the worth Of which changed from day to day.
Never until this year. have the people been free
from bondage TO bal money. To-day every note is
good and alike good in every part of the land.
How great this change is few know. More
than half the grown men of this day were too
young when State bank-nOtes went out of use to
have clear IDEA OF their effect. There were as
many kinds of money there were States, aud If
some systems were comparatively good, many were
very bad Under each system. good or bad, there
were banks of all sorts, from the best to the worst
The resulting loss was great in every part OF the
country, but the West and South bore tax it
seems amazing that they endured. Some OF the
older States taught by early Losses, took great care
20 guard az 4inst bad banks and bad money. The
East kept most of its notes good by sJrict laws,
sharp watching and quick redemption. But at the
West and South banks ran wild. MANY failed;
few were quite sound and the notes of all were at
a discount in the Eastern markets. Eastern dealers
could not take Western money at par, 1or the FISK
about il was too high. Yet a Western man, who
gave bill or note, might pay in the money current
at his home. In all dealings with him, therefore,
the discount on his bad money was exacted; he had
to pay more dollars because his dollars were bad.
Thus 1t came to pass that the rate of exchange
Vt IL and
varied widely at different times, or as to different
places.
If the only storekeeper in a country district finds
that farmer gives him three pounds of dirt IN
every hundred of cotton, or three bushels of chat
in every hundred of wheat, he give only the
price of nnety-seven good pOundsOr bushels for the
one hundred purchased. If the farmer buys goods,
to be pad for in that kind Of wheat or cotton. he
can get only ninety-seven pounds of sugar, or
ninety-scven yards of cloth where good wheat or
cotton would buy one hundred pounds or yards
The West and South placed and kept themselves in
just such plight by using bad money. The East
made them paT, in the rate of exchange on all bills
drawn a part Of the value of every bushel of wheat
or bale of cotton sold, and added price on every
box of goods bought to cover the risk involved be-
cause their money was poor. There was wrong
in this. Those who chose to have bad money paid
for their choice. The East, the only storekeeper
of the country, could not afford TO take bad money
the same good money.
There was no other cause for the enormous rates
charged at times against some regions. Thus IL
1888, while tht rate against some places In Penn
sylvania was cents on the dollar, it was Ii to
cents against Virginia, to . against North Caro-
lima, 10 IL against South Carolina, gig to 10
agau>. Georgia, 10 20 against Alabama, . to l2l2
against LOUISIANA outside of New Orleans. - TO 80
a., -. Tam
3l2 to zig against Kentucky, to zig against Indi.
ana and Illinois, aud to Z cents on the dollar
against Ohio. No wonder "hard times" lasted long
when producers had to pay such rates Yet this
Tax to cover RISK and loss by bad money scarcely
ever averaged less than to z cents on the dollar
which was charged IN 1859. Even at that rate,
the cost to the West aud South was enormous. Not
less than 81 900 000,0 is now drawn in exchange
each year by the West aud South upon the East; at
the rate of 1852 the tax would be from $40, OOoooo
TO $50 600, 900 yearly. Though traffic was smaller
before the war, the rate in many years was much
higher. Daring the seventy years before the war.
who can tell how large a sum the West and South
paid for the luxury of having poor money!
Now, for the first time since Western and South
ern States were settled, they pay not one cent OF
tax because of any nferiorty IN the money they
use Their money is precisely as good as that OF
New-York or Boston. The trlfllng rate OF exchange
now charged is barely enough to cover the cost Oh
shipping currency from one point TO another Inc
use of money that is equally good in all states ID
worth to the West and South alone, at least @3O,-
600 600 year-more than their share OF the inter-
est on the whole public debt.
But the whole country also gains To the people Oh
eerv section there was a constant loss by the use
of money that was in no two places of the same
value. never and nowhere quite good, and at most
nlaces and nearly all the time very bad Who
can compute the mere cost of detectOrs and the
vaste of time in searching them for every strange
notef The sharpest bankers and dealers lost some
thing every year by taking bad notes. one Keen
business man kept the bad notes taken by hun for
five years before the war; They made roll as thick
as mans arm and pretended to be worth more
than small farm BY far the greater part of the
loss fell upon the millions of wOrkngmen and PLAIN
people, who had small chance to protect themselves
Some lost money by counterfeiJs, some by notes OF
ne existed by notes of banks that
never were good and many by notes OF banks that
failed Much has been said Of the panics and great
disasters caused by bad banks but all the losses at
sucb times of special distress small, compared
with the constant waste and loss day by day, aud
wear by year. which no history records and no man
can measure.
Not a man has ever lost a dollar by holding note
of the kind we now use Great loss there has been,
because those notes not good at one time as
at another but that Is now ended. For the first
time we have a currency the worth of which bank
ers, money-dealers and excbange-brokers cannot
fix as they please, at rate for one place and an
other for another 1t is uniform, fair to ALL and 50
well guarded that no man looks to see whether the
note he takes is one of the United States of some
bank near or far of. All the notes are at all places
and at all times as good gold because the holder
can at any time get legal-touders for bank notes
and gold for legatenders What reason IS there for