The Mt. Sterling advocate. (Mt. Sterling, Ky.) 1890-current, 1896-01-21
Checks and the pei Capita.

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the country does MOI depend upon
The volume of currency To use the
expressive language Of a Populisi
iinancier, they believe that to double
the amount of money is TO hslve til
debts aud to halye the money is 10
double the debts. As they do moi
care to reason, no form of argument
appeals to them with such force as
these concrete illustrations; hence
their association of the idea of an in
creased amount of currency with an
increase OF their prospective holdings
of such currency. 1t was because OF
this lack of logical power that "coin"
Harvey's citation of the cube of which
represents all the gold money of the
world, when contrasted with the daz-
cling mountain of silver, seemed All
irrefutable argument in favor of the
cheaper metal. Likewise because the
per capita of the Frenchman is about
$37 and the per capita of the American
is only about $23 they conclude the
cause of the latter's financial troubles
is the comparative scarcity of his cir
culating medium.
AS matter of fact, we have an
over-abundance of money, though it is
not all of the best quality. We use
checks and other forms of credit in
struments to an extent undreamed of
in France, and this enormously null
tiplies the per capits, though no Pop
ulist thinks of arguing that it reduces
his debts. To show how small is the
real volume of money with which the
immense business of this country is
transacted it is worth while to con
slider few remarks from the speech
of Mr.. j. Edward Simmons, President
OF the Fourth National Bank of New
York, upon the occasion of the dedi-
cation of the new Clearing house
building there last Wednesday. In
the course of his speech Mr.. Simmons
said:
ain connection with the currency,
let us consider briefly the Blu, iness of
the New York clearinghouse during
the forty-two years of its existence
The total transactions from October,
1853, to October, 1895, amount in all
to the sum of 1902, Sl5,S1S, O55-a
sum sufficient, if coined into half
eagles, laid fiat so as to touch each
other, to make golden pathway ten
feet wide around the world. The
balances were little more than Al
per cent, of the clearings, and even
these balances were discharged,
not in currency, but principally By
certificates on common depository.
fake, for instance, the balances fer
The year 1888. One-half of per cent
ii the entire earnings, was paid in
Legal tenders and coin. Not long ago,
when the exchanges averaged $ll3,-
0l9,0ll daily, the checks and drafts
presented by the several banks so
yearly offset each other thai of every
500 of the balances all but S47S were
paid in checks. What do these
figures proclaim? They tell us how
insignificant a role currency-I care
hot whether it be gold, silver or legal
tender notes-plays in the great mass
of business represented by our clear
ings.
Owing to the progress made by
our system of clearings, can truly
say that in no country is business so
immense transacted with an amount
of the precious metals so surprisingly
small. AT least 80 per cent. of all the
business of this country is a credit
business done by checks, drafts, bills
of exchange, and other commercial
instruments. Every step in advance
made in our system of exchanges re-
duces the Importance Of currency
Already our progress has given to ST.
the power to do the work done by
500 at the beginning of the century
The currency of country need not
equal its wealth nor the volume of its
merchantile transactions. The figures
denotlng the exchanges of the Ameri-
can clearing houses amounted in 1888
to over $50,00O,O00, OOO-thirty times
all the gold and silver and bank notes
then in the country. Therefore, not
alone on the abundance of the cur
rency-depends our counry's business
prosperity. No Legislation and no
financial juggling can make country
prosperous; only industry, economy,
thrift and self-denial can effect this
resulfn