Year: 1869

Operations md Exchange.


The old system Of exchange between differ
ent countries and sections of a country is un-
dergOing q change, and Is destined to be
revolutonized through the influence Of the
magnetic telegraph. In past times, when
specie was comparatively scarce to what it is
now, and when the means Of communication
were slow and limited, the difference In tho
value Of money In different countries was often
great, and this produced considerable profit to
bankers and exchange brokers at the financial
centres Of the world. Merchants aud others
were willing to suffer great shave, to use q
Wall street expression, in making drafts or


settling their balances, for the sake Of con-
venience and to avoid the risks and slow pro-
cess of transmitting money. In the dawn Of


commercial development the rate of exchange
was sometimes very high, and that between
| countries not far distant from each other, as,
for example, between England and Holland


but as space and time became destroyed more
and more through the discovery Of steam
power and the telegraph, it was more equalized.
| OF course the balance of trade even now
against or in favor Of country OF section
regulates to some extent the rate Of exchange,
| II being higher against debtor country in some
proportion to its debts or obligations, and in


favor of the creditor country ia: holds the
capital The profits on exchange to great
financial centre are very large, and II is these
that have contributed greatly to the enormous
wealth and moneyed power Of London. But
even with the balance of trade against a
country exchange must be reduced and more
equalized through the rapidity, facility and
cheapness of communication. Indeed, this
will tend to equalze trade and keep the
balance down more within the immediate
wants and means of people.


Instead of sending money from one country,
or part Of a country, to another, or of buying
bills of exchange, the cost and time of doing
this will be saved by simply making deposit
with some agent or banking institution aud
telegraphing the fact. This is done now to
some extent, and the time is coming when the
telegraph will be almost the exclusive medium
for such transactions. This will have great
effect upon currency and the use and value of
specie. Much less of both will be needed.
Almost the only demand for money, whether
in the form of paper or the precious metals,
will be for small change, which passes from
hand to hand in little ordinary transactions.
All large operations in trade will be balanced
or adjusted through the telegraph. A similar
result will be brought about between different
countries and sections Of the same country, RS
we now see in the operations Of the Clearing
House in New York city. 1t is known that
the vast financial transactions with the banks
here, amounting to hundred millions or more
daily, are all adjusted or balanced each day
by the comparatively Insignificant sum Of one
or two millions Of currency or specie through
the Clearing House. In q certain sense this
balance Is all the current money needed. Ex-
tend this system to the whole country-and it
will be 80 extended in time, through the agency
of the telegraph-and we see that much less
amount of currency will be wanted throughout
the republic We are on the eve Of this
mighty revolution in financial or monetary
operations. In fact, it has commenced
already.


This Is one Of the subjects resulting from
the wonderful developments of science and
progress Of the age which demands the atten-
ton of statesmen. Such an important change
In the trade, financial affairs and social condi-
ton Of the country must be met by suitable
legislation. The agent that is to produce this


revolution-the magnetic telegraph-must be
e x,-etr, ~
remain in the hands Of monopoly Of indi-
viduals or companies. The interests involved


are too general and too great. The day is not


distant when the telegraph will be used more


than the Post Office, and, indeed, 1t would be


more used now If the rate of charges were


brought down TO the lowest paying point and


within the means Of the general public. Every


argument that can he made in favor Of the


Post Office being under government control


applies more cogently to the telegraph. Con-


gress should prepare at once to establish q


postal telegraph system for the whole country


and hold the absolute control over 1t. Not tc


farm the business out to companies, as some


have suggested; for that would only be 6
modification Of the present monopoly and
evil, but to manage 1t as a department, just a'


the postal system is managed. To this enc


Mr.. Washburne's bill for an experimental tele
graph line between Washington and New Yorl
should be passed without delay, and, besides
that, the new invention for an automatic self


telegraphing system, which, 1t is said, will mul
tiply the facilities Of communication eight o.
ten times, should be tested by government
and, If found successful, should be taken ant
/ used for the public good. Let us follow a
once the example set by Belgium, England
and some other countries and place the tele
4 graph In the hands of government Soone