Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1891-06-25
HON. w. H. GRAIN.
VIEWS OF CONGRESSMAN FROM
THE SEVENTH DISTRICT.
No Pressing Need for More Money-Men
Who Have Security to Offer Can Bor-
row at Reasonable Rate.
CUERo, TEX. June l.. 1891.
Editor Gazette.

CUERo. TEX. June l.. 1891
Editor Gazette
The communication from 1.-The Democrat
| publishing company upon the subject OF
| The Need of More Money in Circulation
| and How 10 Provide IT. reached my home
| during my absence in the North and pre-
sumo my views at this late date will be of
no value, as the letter stated that the opin
ions OF those who had been addressed by
the publishing company would form q SYM
postum in one issue of THE GAZETTE. How
ever, shall comply with your request for
orevity, and answer your questions as con-
cisely as passible, according 10 mys own
judgment.
Your questions are:
l. Do we need more money in circulation
?. If not, why not
8. If we do, what is the wiSest and most
effective plan for providing this additional
circulationg
To which | answer:
l. l cannot discover any pressing need for
more money in circulation than what we
have and are daily turning out.
l know that 1t is urged that money is
scarce at present, but temporary financial
structures do not justify initiation.
Indeed, except in extreme emergencies,
men can borrow money at low rates upon
satisfactory collaterals at financial centers.
Even in the country the security must be
considered good whether ii be real or per-
sonal, by the lender before he parts with
his money. Because capitalists and truS-
tees and banks prefer to hold their money
in iron vaults rather than to lend ii on what
they regard as poor security. Is no evidence
that there is not enough money in clrcula-
ton Whether a man be worth $40 coo or
$40, 900, 900 he will demand safe security for
the amount required by a borrower. IL is
alleged that the high rate of interest de-
manded in Texas and other rapidly devel-
oping states is proof of the necessity for
more money in circulation. 1t proves moth
ing of the sort. 1t simply demonstrates
that there is not enough of idle capital
in those states to meet the demand
The very bankers and capitalists in Texas
who lend money at 10 and II per cent bOr-
row it at from 20 per cent These facts
show that there is not a satisfactory dis
tribution of the money of the country, not
that there is need for more. There was a
time in the history of New York and of
Boston when the rate of interest was
high, but the development Of the country,
the concentration of capital there, the less
eued demand and other causes have re-
duced that rate, land the same causes are
beginning to operate here), until it is be-
!ieved the government can borrow money
at per cent per annum. In discussing the
question of the need OF more money to
transact the business OF the country, men
often forget that the bulk of it is done by
drafts, checks, etc, and not by the actual
handling of money
The clearing houses illustrate this fact.
Indeed it would be difficult for the govern
ment to grind out fiat money enough, if it
could be done at all, to transact the Internal
commerce of the country alone.
And were the governments to do this how
would the money get into circulatiOns
Every man has to work for what he receives
and no matter hew much money there
ha no Inf
receive no more than he does now. Indeed
he would absolutely receive less in pur-
chasing power because every working man
is lender to the extent of his unpaid
wages.
Those who claim that we need more
money in circulation triumphantly assert
that France has more per capita than the
United States and that therefore We have
not enough.
The conditions are very different in the
two countries. In France there is compar-
atively very little banking business done by
the people who mainly barter and trade or
use actual money in their business and
hence they need more. Their banks ara
the chimney corners, old stockings, pots in
the ground atd other hiding places which
responded to the call of the government
when the German debt was TO be paid.
But in this country, as have already said,
the people do business principally through
paper and upon the credit system. And
this leads to the consideration of another
argument advanced by those who sSSert
that we need more money.
1t is the argument based upon form
mortgages. / cannot speak from personal
knowledge of the causes for farm mort
cages elsewhere, but here I know that over
70 per cent of them are for the unpaid pur-
chase money for the land
The custom is to pay one-third cash for
piece of farming land and the balance i'll one
and two years to secure which the vendors
lien is retained. OF course these are not
fixed terms, as sometimes the farmer pays
more and sometimes less in cash. In nu-
merous instances farms are mortgaged to
buy more land or to make improvements
which enhance the value of the land. In
deed very few farmers, comparatively
speaking, can mortgage their farms be-
cause they have not enough over and above
homestead provisions of the constitution,
money can be borrowed and is
actually loaned by national banks, I am in
formed, upon vendors lien notes, or notes
for unpaid purchase money upon land. But
that farms are mortgaged 1t seems
to me that this proves that the farmer
hadn't enough money to satisfy his needs,
not that there was not sufficient in circula-
ton, for the very mortgage shows that he
has secured the money. True, the rate
may be higher here than elsewhere, but
that is the case in every rapidly developing
state or country, and will change with in
crease of population and material develop
ment But you requested brevity and 1
shall conclude by experimenting my origi-
nal proposition with the statement that l
believe the monthly purchases of silver are
ample to maintain the financial equilibrium
Of the country if they do not actually in
crease the circulation which l think they
do have answered your second question
in the foregoing answer and your other
question needs no answer in view Of the
opinions expressed by your obedient SER
want. w. ID. GRAIN.