The Manning times. [volume] (Manning, Clarendon County, S.C.) 1884-current, 1897-09-01

porters of gold can get it at the
Treasury on Sherman notes and sill
yer certificates, the banks certainly
will not furnish it, and we will have
runs upon the Treasury just as we
do now.
To make the plan effective all Gov
ernment paper would have to be
withdrawn, and then the silver dol
lars must follow. If this be done, 1t
will take about 5000, 10000 right out
of our currency-practically all that
is in actual circulation.
To prevent contraction Of the
currency, the banks would have to
issue about $900,000,000 in notes in
excess of the $200,000,000 now out,
making $1,100, 100000 in all. Accord
ing to the claims which for years
they have so frantically made, they
must stand ready TO redeem those
notes on demand Otherwise they
will depreciate; gold will rise to a
premium, and then ruin. That is
what they have said right along, and
everybody knows it.
Now comes the query: Where are
they to get the gold to not only
maintain their paper at par, but to
also furnish it for export?
They answer that they can get the
gold and keep it by raising the rate
of discount the same as the Bank Of
England does. This, however, will
not meet the case. Raising the rate
of discount is simply charging more
for money loaned, and the effect is
- - ofc osfI Er
the currency and lowering prices.
The idea is that fewer notes being
in circulation fewer will be presented
for redemption, and thus the gold
reserve will be protected. This is
true in measure, but it must be
borne in mind that raising the rate
of discount is substantially the same
thing as charging premium on gold.
If man wish to borrow money al
a bank and upon making application
find that he must pay one or two per
cent. more in order to get it, he is
practically paying a premium
under the name of discount The
only difference between 'gold pre-
MUM and a bank discount is
that the latter is charged upon the
banks own paper. 1t is true that sc
long as the gold reserve is kept suffi
ciently strong the notes will be al
par with the gold, but raising the
rate OF discount puts both the golc
and the notes at a premium over
commodities and property. But thi:
makes no difference according tc
goldite theory. The lower prices are
the better, and so long as lone dollal
is as good as another, we are al
right"
But comparisons with the Bank O
England are utterly fallacious anc
misleading. That great bank make:
no attempt to carry such an amount
of paper as would be necessary here
1t is only allowed to issue notes tt
the amount of $50, 100000 in excess o.
the actual cash reserve. To put oul
currency on the English basis would
contract it to an extent that wOulC
| literally paralyze business. Besides
it must be remembered that even The
Bank of ENGLAND is sometimes shaker
to its very foundations, and tha'
England has as many panlcs and a:
severe ones as we do.
But beyond this, the Bank OF Eng
land furnishes no parallel. In The
first place, it is not proposed to create
one great national bank. That ques
ton has been pretty well fought ou'
in America The system proposed
Will necessarily consist OF a multi1ud'
Of comparatively small ones. Some
will be strong and others will b'
weak. Some may be able to main
tain gold payments and others not
When financial troubles come there
will be no end of runs on the weak
er banks followed by failures, anc
then will arise the question Of The
value of the notes of the broker
banks. In such cases the stronger
banks will have enough to do to pro