The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1900-01-15
STILL IN DIFFICULTY.


To the Editor: Many thanks for the
publication Of my previous communica-
ton, January 5th. But to me your ex-
PLANTATION Of the endless chain" difficulty
makes the question still more complicated.
Nor does Senator Aldrlch In the reported
portions of his speech clear 1t up. The
last statement you make in your edito-
rial explaining the difficulty is, "it is the
legal tender and it alone that can set the
endless chain In notion while in the
preceding paragraph you say. yet there
was no demand for gold in exchange for
silver dollars in the days when the treas
ury was called on for gold in exchange
for greenbacks at the rate OF from s4,ooo-
900 to S10000,000 u week." Surely, the sill
yer dollar at that time was illegal ten
der" Again, you say in your first par
agraph "the greenback is the only purely
credit currency In this country" yet in
the next you say of the silver dollar: at
has bullion value but not equal to its
face" (yalue). What can you call the diff
ference between its face value and bullion
value but credit If all our currency must
be maintained at par? Was 1t because the
silver dollar had bullion value and the
greenback had none that the greenback
was used as the endless chain?" If so.
give us more silver dollars and less green
backs. Again. you say that silver GER
tificates can not be used to draw out the
gold and you also say I'VE are pledged to
maintain the parity of all our currency"
Parity with what? Surely with gold. IL
silver certificates cannot be converted
either directly or indirectly into gold, how
can their parity be maintained? 1t is true
that they call directly for silver dollars.
while silver dollars call for nothing and
the greenback calls for simply dollars
which might be either gold or silver dol
lars yet when we maintain the parity of
all these different kinds Of currency with
gold we must stand ready with gold to
back them That has been the policy of
the government with the greenback, and
to make our pledge good gold must be be-
hind each. If not, then to that extent will
such currency depreciate and fiuctuate in
gold values as did the greenback before
the resumption of specie payments. Fur
thermore. is not the bank note part of
our currency? II SO. is not T. also a
purely credit currency?" OF this bank
note issue you say that in case the bank
cannot redeem, then the government
will" That is what l stated. You say
"but the treasury has deposited with 1t
bonds to more than the total note issue as
security" The new currency bill referred
to in Senator Aidrich's speech permits
the note issue to be equal to the face
value of the bonds. You further say If
the government has to redeem. It sells
these bonds for gold.' From Senator AL
drich's speech. to which YOU refer. find
that the intent Of the senate bill is to
place its (the) national debt upon a 2
per cent. basis and keeping its obligations
issued at that rate at par In the markets
of the world" If then these bonds are to
be kept at par by the government are
made the basis of bank note issues to the
amount of their face value, and may be
sold at public auction to raise gold to
keep these bank notes at par. /. e.. TO re-
deem these bank notes, and gold is
in great demand, which II Is hound
to be in times of great financial stress, I
confess 1t puzzles me to see how the gov
eminent can maintain one class of its pa
per with the other and maintain it at par
at the same time. 1t is bound to compel
a new issue of bonds, which will simply
place us that much deeper In the mire, az
we will be compelled to maintain the par
ity OF the new bond. and so on ad infini-
tun. OF course we can never expect the
government to be called upon to redeem
bank paper with gold except in times OF
great financial depression: hut as stated
in my former communication, neither win
1t be called upon to any great extent to
redeem greenblcks except at such times
1 am therefore forced to the conclusion
that under any system OF credit currency
the endless chain of redemption Is
bound to exist. Whether that credit cur
rency is composed of greenbacks silver
coin, silver certificates, gold certificates,
bank notes, or any other kind issued, SO
long as we are pledged to keep each at
par with gold we must stand ready TO pay
gold on presentation of the credit cur
rency, and the endless chain Is on The
great danger and about the only danger TO
the government Of credit currency is In
having the money of redemption dispro-
portionate In amount-to the money to be
redeemed. F. NJ. HEApLEE,