The times. [volume] (Richmond, Va.) 1890-1903, 1893-02-19
VALUABLE AND INSTRUCTIVE
PAPER

Post an interesting and highly instruc-
tive article. contributed by NJ. Paul Beau
regard to 10 Monde Economique," uron
the Bank Of France and its note Issues,
which we print this morning. and which
Will we'll repay perusal.
The paper is a distinct and forcible
argument In favor of absolute freedom
In banking-in favor Of the business Of
banking being left to tho regulations
which trade and commerce work out in
stead Of to those which finite and short
sighted legislators set up.
1t will no doubt surprise many Of our
readers to learn from this paper that
the notes Of the Bank Of France are a
full legal tender all over France for all
loans; but It will surprise them still mole
to learn from it that this il a quality
In them for which the Bank Of France
cares absolutely nothing. So high is It's
credit all over France that men had
rather have its notes than to have CON-
and they are therefore at a premium as
compared with coin. What a lesson this
should teach to those who are eternally
seeking to tamper with the natural laws
which govern all matters OF finance. II
they were capable Of learning anything,
they would learn from II that II Is be-
yond the power of human laws to give a
financial value to anything whatever.
Value in coin depends upon the intrinsic
~ - nd VAL N
promises to pay coin depends upon the
credit Of the issuer Of the promise. Leg
islation may embarrass the use OF either.
but It cannot add a silver to the value OF
either. Value II Independent OF legisla-
ton. Commenting upon the fact that by
limiting the note issue Of the Bank of
France to four thousand miihcns of
francs $500, O0oO oo). the legislature there
by impairs the Banks power to be useful
to commerce. NJ. BeaureGard pertinently
remarks:
THE public. In fact. does not receive
from the Bank all the services that 1t
might render. Limiting its chief function
| TO supply notes to take the place OF gold
and silver In the circulation. the Bank
does not furnish to industry and to COM
| merce the resources In the form of credit
that they would find In an issuing estab-
lishment which should apply itself large
| ly to discount and advances Of all kinds
II is. however, the inevitable effect OF
monopoly TO transform the Bank from
an establishment of credit. which 1t ought
to be. to a simple regulator of the circu-
lation. But, then, why hold the Issue OF
notes under guardianship? Why not
al nH
will the proportion of Its metallic reserve
to Its circulation"
There are no sound reasons. based in
logic and common sense, why legislation
should interfere with banking freedom in
any matter OF the kind. NJ Beauregard
cites facts which have a powerful bearing
upon the case. He shows that between
1852 and 1892, when the Bank Of France
was limited to note issue of three thou
sand five hundred millions Of francs
$780, 100000, 1t added five hundred and
fifty-eight millions Of francs GIL, 900 900
to its issue OF notes. but one thousand
one hundred and sixty-nine millions Of
francs C234, 100000 to its reserve of coin.
Of which one thousand and fifty-six mill
lions Of francs sz11, 100000 were gold.
while only one hundred and fourteen
millions OF francs Cs23, 900 900 were silver.
Until the Bank had reached the limit Of
Its note Issue II was Of course doing bust
ness without any restraint at all. 1t was
practically free bank. Now. while 1t
was banking as free bank. 1t added
IL.
serve for every dollar of paper that
It issued. and Of that addition s211, ZOO, 600
were gold. while only s23,000,00o were
silver. and that in France. to which all
the free silver men point as a silver
country These facts present an argu-
ment for leaving banking to itself as all
other businesses are left to themselves,
that is simply overwhelming.
We find in these facts. and in NJ.
Beauregards whole paper powerful rea-
sons why the tax Of 10 per cent. on the
issues OF State banks should be repealed.
This tax makes 1t impossible for men
who dwell at distance from the national
banks to make any use whatever Of their
Stcot. AHSS SoAiot bSttoW tion inc
national banks, because these are all
located in the cities-the commercial CEN
tres-and those who manage them have
no personal acquaintance with the farm
ers living in the country. They will there
fore make them no loans. What the
farmers want Is an opportunity to estab-
lish their own banks Of issue. which will
furnish them with currency by which
they can effect their exchanges amongst
themselves. the currency redeemable, Of
course. always in coin. on demand. The
national banks may be blessing to COM
mercial centres. We shall not deny that.
But the National Bank act, in restricting
all bank issues to those banks and deny
ing the right to issue to any other banks,
has been, in our opinion, the curse OF the
day and the cause Of all the financial dis
tress of the country.
THE PHILLIPS BROOKS MEMORIAL
MEETING.
That was a glorious tribute to Chris
tian man which occurred In New York
mi ~.