New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1891-03-21
rUPPENCY and SPECULATION.

Nr Simpson of Kansas, may congratulate
nself that his crude notions about the money
Question have produced for him more public at
,artion that he could ever have obtained If he
had talked much more wisely. 1t may be grant
od that he is in the right in one particular ana
that the Western States do in fact suffer from
loci, of sufficient currency at certain season
in the wear when crops have to be moved. Bu'
no docs not seem to have asked himself the
ouostion how further expansion of the cur
roncv would remedy this admitted evil. All
understand that currency, such as it Is, would
no furnished to the farmers IN abundance II the
so.callcd Sub-TreaSury plan should be adopt
cd. providing for unlimited loans OF currency OIL
nroducts deposited in public warehouses. b"l
Mr.. Simpson does not seem to PIN MS laIuh "
that plan. and he has possibly discovered tha'
the quality or buying power Of such curfehc!
uou,d be exceedingly doubtful. 1t is also under
stood that there would be plenty OF money ioi
tho farmers. such as it is, if the plan OF unllm-
;,od loans on farm lands were adopted. But the
vo,,mo of circulation would in that case new
tobIv become so large that the notes would be
practically worthless. Mr.. Simpson may natu-
rally inquire, with his peculiar ideas, why IL Is
not possible to have a moderate expansion OIL
the circulation without destroying its value OF
purchasing power.
In that case how would the expansion benefit
tho West? For if the Government is to issue
more money, it has to issue that money lof
something. 1t must either pay debts by the
urchase of bonds or otherwise, or pay out
money to the people for pensions or in settle
mcnt for things or services purchased. II there
.boroforn tho Government
must simply pay out more money thah IL uoe'
now. But how is it to pay out more money III
such a way as to get it lodged at the west
This is the problem which Mr.. Simpson has not
solved. and seems to have scarcely attempted TO
solve. And, further, how is the Government 70
nreyent the money thus paid out grayitatn2
swiftly and surely to the cities which are the
nrincipal centres of speculation, Just rs money
does now? Until Mr.. Simpson can suggest some
mode of rcmedyng that difficulty, an expansion
Of circulation would be OF no practical dement,
to the Western people.
For example. the Government pald out last
voar about 500. 900, 900 more money-added
that amount to the money in actual Grcuanoh
outside the Treasury. But it Is well-knoWn
and admitted fact that very little OF this added
.,nply has found Judgment in the pockets OF the
farmers Large sums were indeed sent to the
West and South, as Is usual IN the laII' anu
probably the sum paid 10 the farmers for Their
crops was about aS large as usual IN the a@Sre-
gate notwithstanding the palua iailurc VI
wheat. corn and oats. But the money thus phu
WAS needed by the farmers for the settlement
IF their obligations and for the purchase OF
necessary supplies. In large proportion Oh
cases the farmers already owed nearly or quite
~ much as they received, and had to pay out
the money about as fast as 1t came IN. Nhen
IT, went from them TO the nearest dealers Ii diu
not lodge there for they in turn had ooh8a-
lions 10 be met. When it reached local banks
ooain il was forv arded with little delay to
tho prjncpal centres of finance, where it could
he Immediately employed with profit spec
ulation began to be active and excited, ana
nrices rose 50 that every boatload OF wheat
required more money to move 1t or carry j.
than before. and in that process all me addi-
toual currency was swiftly absorbed In iact
the advance in prices almost outran the cAp1h-
sion of circulation, so that greater Stnngency
and pressure were seen in all the money mar
kcts than had appeared before the increased
circulation was issued. BY what process Will
Mr. Simpson prevent this grayitaton OF the
surplus currency to centres of speculation aS soon
rs the farmers who are supposed to receive II
have paid it out for their Indebtedness or their
supplies?
It is easy to say that speculation ought to be
s,pureS>ed. Probably Mr.. Simpson or some
other Alliance leader Will propose plan to
SION speculation altogether. The legislators OF
Illinois tried to accomplish this years ago p!
stringent laws, but have never met with much
success. 1t may be doubted whether new efforts
in that direction viii accomplish anything more
Bu, so long as speculation continues possible SO
long added supplies of currency will simply feed
the fires of gambling, hoist prices, and so cause
all the available funds in the country to be
quickly absorbed