Year: 1866

False Alarms About q HevulstOn.


Every now and then certain class of fnan-
cial theorists predict revulsion, universal
smashup, and all sorts Of evils These people
are constitu,ionally bears, and no amount of
argument or facts showing the contrary can
knock the theories out Of their heads, If the
prediction be not fulfilled at the time stated
they say the catastrophe is only deferred and
will surely come. They have been repeating
all along since the war closed their gloomy
forebodings that we should have terrible re-
vulsion in this country. Even the Secretary Of
the Treasury, about year ago, was one of
those prophets of evil. They predicated their
theories and predictions on what they called
an inflated currency, and urged the necessity
Of immediate contraction as preventive or
remedy. In the face of all this the country was
! never more prosperous. The enormous burdens
imposed upon us by the war have been carried
with ease; they have not checked our onward
progress in developing industry, commerce
and wealth. Nor has our unparalleled pros
perity been fictitious or unhealthy. 1t is sound
and substantial and is based upon positive
| production, progress, and the increase and
capitalization of solid wealth. The currency
represents but small portion of this wealth.
So great and continued has been our prosperity
that those who predicted disasters have been
compelled to express their surprise. They
have been forced to confess that "the country
is doing very we'll" notwithstanding their fore
bodings and theories. Perhaps Mr.. McCulloch
and some others of our public men begin to
learn something about the true condition Of the
country, for we have observed Q change in
their language and course with regard to ques-
tions Of finance and currency. Still we notice
the old cry of alarm is raised again. Aportion
of the press, which seems incapable of learning
anything by experience, reiterates again the
unnecessary and false prediction Of q coming
revulsion. There Is no more ground for this
than there was before. Indeed we are becom-
ing stronger every day, and the business Of
the country is settling down healttfaIly to the
new state Of things brought about by the war.
| But these alarmists refer to periods Of former
revulsions in this country and other eountries
and to the incidental breaking up Of few rot
| ten banking institutions or commercial houses
| to justify their predictions and support their
| theories. Their argument is that because a re-
vulsion took place in 1887, or at other periods
before and since, we must have one shortly
again. They do not stop to think whether the
cases are parallel or not. II might be said with
as much reason that because we had a thunder
storm yesterday we must have another to-day
| yet everybody knows this Is no reason at all.
Everybody knows that unless the same state or
conditions of the atmosphere exist there conld
| be no succession of the storm. II is just the
same in the financial world. There can be no
general revulsion unless there be similar causes
to produce it that have produced other revul-
sions. Nor does il follow that because few
unsound banks or large business firms break,
the whole country is going 10 ruin. They may
not be the precursors Of q storm, but simply
the beginning and end of a little storm in them
selves. These failures are constantly occur
| ring, even in the most heallhfsl commercial
mismanagemcnt, fraud or accidents, and may
be no indication OF the general coalition of the
country.


Most Of the great revulsions that have taken
place amodg the different commercial nations
of the world after wars have been caused by
injudioious efforts to force specie payments.
These efforts have been made by contracting
the currency and have resulted In reducing the
property and means Of the community, in dis
turbing existing values and obligations and in
producing universal bankruptcy. Such is the
testimony Of history. England, especially,
went through q succession Of these fearful
periods Of bankruptcy and distress, after the
long wars against Napoleon, by endesvoring 70
force specie payments. We may avoid all that
easily enough by just letting the laws Of nature
and trade work out the problem Of the cur


rency. There need not be the least apprehen-
sion about q redundant currency or coming TO
specie payments within o reasonable time.
The extraordinary resources and development
Of the country win bring its business at no
distant day up to the present volume OF cur.
rcucy. We may doubt even II the present
amount is greater or but little more than the
business Of the country demands at the
present time. We shall, in the natural
course OF things, BEAUTIFULLY approx
mate q specie basis. So far, then, there


IL no reason to fear q revulsion from hav


ing q redundant currency. We might have
cause 10 fear II an injudicious effort were made


to force specie payments. Overtrading, excess


i've importations, and, as o consequence, ex


change being against us, might create seri


Gus disturbance in our affairs; but so long q,
we can bring out the cotton crop, the gold and
silver from California and other States, and
our productions In other respects keep pac,
with our national growth, we need not sppre
, hend much trouble. We are In very differ
ent condition TO what we were In 1887 and q
J other periods Of financial revalsion. There !
| no comparison between our resources now an'
1 then. Let US have as little LEGISLATION as pos