Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1891-09-21

shall have caused its promise to pay such
notes on demand to be signed by the preSi
dent or vice-president and cashier thereof
| in such manner as to make them obliga
tory promissory notes payable on demand
| at its place OF business, such ASSOCIATION Is
| hereby authorized 10 issue and circulate the
same as money; and the same shall be re-
| ceived at par in all parts of the United
| States in payment of taxes, excuses, public
lands and all other dues to the United
States except for duties on imports; and
| also for all salaries and other debts and de-
mands owing by the United States to iudi-
viduals, corporations and associations with
in the United States, except interest on the
public debt and in redemption of the ma
tional currency, and no such association
| shall issue post notes or any other notes 10
! circulate rs money than such as are author
lied by the foregoing provisions OF this
act"
Sec. 26. 'sThat the bonds transferred 10
| and deposited with the treasury of the
United States as herinbefore provided by
| any banking ASSOCIATION for the security Of
| its circulating notes, shall be held ex-
| cluslvely for that purpose. -
| Sec. 30. Speaking of a bank: KS
nor shall it knowingly pay out or put in
circulation any notes issued by any bank or
| banking association which 1T the time of
| such paving out or putting in circulation is
not redeeming it circulating notes in lawful
| money OF the Cnlted States. ~
| Sec. A. Regarding the closing of bank
| inc association. :. x The said ASSOC
| citation may pay over to the treasurer Of the
| United States the amount of its OutStand
| ing notes in the lawful money of the United
| States, and take up the bonds which said
| association has on deposit with the treas
urer for the security of its circulating
| notes T."
Sec 43. - and ali notes so re-
deemed by the treasurer shall, every three
| months, be certified to and burned in the
! manner prescribed in the twenty fourth
section of this act
See acts OF March 8, 1865 vol IS, p. 49Sl
of July II, 1870 (vol. 1G, p. 274); Of June s
1872 ivol. Il, p. $3.50 of June 20 1874 (vol.
3l6), and of July Il, 1852, and any other act
Oh this subject.
The question arises, what is 'lawful
money,
Sec. 5lS6 of the Revised Statutes relating
to banking: g = = r The terms lawful
money and lawful money of the United
States shall be construed to mean gold or
silver coin of the United States; r = "
If Smith sells a cow 10 Jones for so and
on a credit: then if Smith is owing me so,
and l am willing to take the $40 note on
Jones for the amount, then Smith and /
will have transacted $40 worth of business
without money but on the credit Of Jones;
on this note with a merchant, who may also
transact $40 worth of business on the same
paper with the wholesale dealer, etc. In
every transaction debts are paid. The $40
note satisfied the same amount as SO OF
gold. So when l trrnsact any amount of
business with treasury notes or greeabacks
/ do so ON the credit of the United States.
The only difference in the two transactions
is, in the first instance the paper with
which the business is transacted is redeem
able by private individual Mr.. Jones:
while in the second the paper is redeemable
by the government.
1t is very plain that these third party
Observation-Disclosures think that q
legal tender note is really money as well as
gold. 1t passes current. II satisfies or
pays debts. Ten dollars of it will buy as
much as ten dollars of gold. Why is it not
money? Undoubtedly they think that the
stamp of the government gives ii value,
and the material of which it is made is no
question: whether it be wood, paper, parch-
ment, leather, cloth, copper, iron, gold or
silver For it is not reasonable that they
would advocate q scheme to involve the
government in debt to transact private
business if they knew that this plan was to
be carried on without one dollar of lawful
money, but wholly on the credit of the
United States.
Ii the treasury notes in the hands of the
people We're veritable money, as truly as
gold, then the United States would not be
indebted to the holders of them any more
than to the holders of gold eagles: and the
treasury department should not report the
treasury notes as part of the national debt.
In some types of this ''greenback rage"
these fellows want the government to issue |
treasury notes in lieu of all the bonds; i. e.,
they want Jones to borrow $40 from John |
son to pay his note held by Smith or bearer |
before it is due, forgetting that johnson |
l.a, ,.til hac i,1yi -l,.,I
debt is paid. They say pay off the bonds' |
Tney want plenty of the green stuff pre- |
pared to buy up the railroads, the telegraph |
wires, and now they want the land and |
crops bought up with it. l wonder what |
form the rage will appear in nextl
There is d limit 10 every mans credit to |
hold it at par, and whenever you go beyond
that limit your credit falls below par. That
is, whenever man contracts for more, on
a credit, than his worth and prospects to
pay will redeem, confidence in his ability to
pay will decline if not wholly lost. So it is
with the government. There is limit to
hold the governments credit at par and
when we get without that limit confidence
in the governments ability to redeem its
paper falls below par.
In 1862 the government authorized the is
suing of illegal tenders and .sgreenbacks,
which had no specified time of payment
and bore no interest; they began at once to
UeClluS III value I'LL III lCCt lUEy were OILY |
worth 30 cents on the dollar in gold. They
rose the following year; but on March Is,
1853, (Vol. IL, p. y congress passed an act
to strengthen the public credit, in which
the United States solemnly pledged its
faith to make provisions at the earliest
practicable period for the redemption of
these notes in coin. On January II, 1915.
passed an act making the legal
tender notes redeemable in coin after Jan
uary l, 1879. After that date they were re-
deemable on demand, in gold, after having
been irredeemable for about seventeen
years.
Another profitable example of extrava-
gance destroying confidence in the govern
ment will be seen by noticing the recent
history of the Argentine Republic About
five years ago national mortgage bank to
make loans on the hypothecation of real
estate of that country was established The
minister of finance of that country. said of
it: ut is great boon 10 the people, for
the reason that land is the great patrimony
the immense capital of the country-and
every facility should be given to mobilize
the capital and increase its value" The
functions of this bank were TO issue trans
ferable mortgage bonds on the execution of
in its own favor. These bonds
were made payable to bearer, ana bore in
terest at not exceeding per cent: and they
were put on the market Tor what they
would bring.
This scheme has brought shame and dis
grace upon the people of that nation, and
mortified the very intelligence OF the finan-
- I