The Helena independent., 1893-07-03
Ex-senator Henderson, OF Missouri,
Writes a Letter to Sscre-
tary Carlisle.
He Says a Large Circulation Ia
Not Necessary to
Prosperity.
Pretty H7uch Everything In Uinmed ON tho
White Metal, and Fow I:eD.e-
dies suggested.

Is. Henderson, Of Missouri. who has de-
voted long and careful study TO matters OF
finance. has addressed TO Secretary Carlisle
the following communication: Il promised
to give you in writing the substance Of my
staten ents mado to you in conversation
touching the monetary condition Of the
country. then expressed the belief that
the present stringency was produced not by
any lack or Insult cheney Of our currency.
but by the loss of confidence produced
among business men because of tho bad
quality or In ferior character Of a large part
Of that currency. There il no error Of
more common prevalence than that an
abundance Of money issues necessarily adds
to the commercial OF business energy OF the
people. or course. certain amount of
money tokens are absolutely es-
sental with which 10 effect the
smaller exchanges Of commodities. Those
money tokens don't create the exchanges.
but the exchanges create the necessity for
the tokens Among people entirely civii-
lied over 95 por cent of the exchanges neo-
essarv in these operations are consum-
mated through the medium of bank checks.
Experience demonstrates that these bank
facilities become enlarged or contracted a.
money tokens bscoms scarce or abundant.
Hence there is less danger in limiting The
bulk of circulating money than people gem
orally imagine. Bank checks are better for
another reason. Having performed its
Office il coases to circulate. II the sxiqen-
ciss of business demand another check il 10
Issued anew and IN like manner destroyed
when ita object ia accomplished. We shall
never have q perfect currency until every
note used for circulation shall be destroyed
on its return to the authority issuing 10.
| and no new note issued except for value
and only nt the call of business demands"
Commenting upon the amount of money
in circulation let capita among the people
| of the United States from 1873 TO 1893.
| Henderson says that neither individual
prosperity. nor commercial property. nor
commercial activity are absolutely CON-
trolled by ths amount of circulating me
dium. Continuing, he states: II think I
am safe in asserting that from July !, 1879.
to July !. 1883, We enjoyed very great p os-
| rerity, individually and nationally. There
was NO lack Of money. II sufIiced not
only TO fill the treasury. but abundantly an
| swered the demand Of commerce and ex-
kraordinary business activity was follow ed
by very high prices. The average per
capita circulation during that period was
S20.6l. From July. 1880. to the present.
| period Of great monetary strinRency. We find
an average circulation per capita Of 1928 65.
II is thsre efore apparent, in common par
lance, that times may be hard and money
scarce. with a most abundant circulation
psr capita. The circulation in Great
Britain is now $19.34. of which $l4.49 10
gold. $2.63 silver. and $2.24 paper. The
psr capita circulation in Germany Is $1756.
| and vet in these countries, with vast COM
meros and manufactures, there 10 no dearth
Of money and interest rules at scarcely
more than half the rates prevailing in this
country.
"Eneisnd adopted the single gold stand
ard in 1916, and has adhe cd TO il ever
since. and by so doing has became the
money center Of the world. The panic OF
1873 was without doubt the direct result of
the speculation and owe trading induced by
the greenback era. Between 1868 and 1873,
both inclusive, the balance Of foreign trade
against rs was $l.086. 440 587. This long
and steady drainage brought 3 loss Of z
large part Of the nations wealth, and with
IL the country's entire stock of gold. Take
the period OF unbridlsd state bark issues oi
paper money bcsweea 1S48 and 1867. VI
find similar result.
, ing are altogether different from the tw.
. periods named. Is seems 10 me demon
strable, so far as financial proposition Gal
be logically demonstrated, that the presen
situation is mot tho result OF speculation
or overtradinR, or bad business methods
{ silver legislation of congress. The increas
ing production OF silusr as compared will
gold induced Germany to follow Eng
land and discard IL "a twill
I atnndard of value. The American cong es
8 in 1873, actuated no doubt by these views
q ado ptsd without disssne single gold stand
Z ard. Two years after, measure was in
augurated and passed for the resumption o
. specie payments, to become operative OIL
January l. 1879. II thsae swo measures ha,
i. remained on she statute books, inviolAt
= and unamended. there was no economics
. reason why the United States and tn
= people should nos to-day enjoy the mos
. unbounded prosperity. We should hav
!. had the best aud most abundant currency
3 a gold currency OF universal value and o
& such volume as TO 70: CO its circulation. a
. in England. France and Germany. into th
. hands of the people. To be assured of thi
l fact, il 10 only necessary 70 again exsnin
0 the conditions OF commerce for the las
r seventeen years. Although ths excess o
. our export products in 1892 amounted +
II nearly $203 600. 600. yet the most startling
y fact ap. ears that during that year we sx
. ported over $4,000. 900 of gold. and no,
o the balance OF trade has natu, ally tuHnst
= xsainss u.s. and the country is being draine,
! OF remaining gold with alarming rapidity
4 'It only remains now to briefly state tn
character of tho silver acts of 1873 and 169
and furnish you the reasons for believing
the overthrow of pablo confidence and th
present depression in business arc III
, legitimate consequences Of these acts. Tn
o natural or normal results Of this Legislation
Q would probably have followed much soons
10 but for the many abundant crops Of thi
a country aud the numerous failures In tha
d respect abroad. Under the act of 1873 th
" government purchased 29l. 292. 0l9 ounces O
' fine silver at q cost of $30S. l93. 262. an
q coined 1t into silver dollars to the amour
70 OF S37S, ,196. 1888. a profit of nearly $40 900.
600 made BY stamping q afalsehood ON th
coins converted into the treasury % =
much p,oft. Under the not OF 1880. th
government up to June l. 1893. purchase
y $14b. 36l, ,s57 In silver and under a. injuns
+ ton continued coinage for "A year. Unds
10 the act of 1890 there were coined additions
IN dollars to the amount of $36. 087 ,04O. Add
X ing to these amounts the reooinage OF trad
4 dollars into standard dollarA and y
Al had on June l, 1893, coined silvs
" dollars amounting 10 S49. S32. 3Ol
Il Ii we take the market price OF June ], 4
cents per ounce) she loss on this bullion 4
pu, chased by the government wns on thr
day SS3, ,51S.62 On June 26. 1893 bar 81
YER was wotth only IS cents per ounce. sn
y failing upon the government an additionl
10 loss OF "a. 583 432 In less than mouth.
10 1T was obvious to tho least discerntu
n finnuciers of ths country that the act I
1879 vould evsnlualiv hrinu About d