Year: 1871




terest of money, and We are aware that there
have been and are such sometimes; indeed,
the market Is greatly affected in spasmodic
way or for short time by these combinations.
But after all, their influence is only tenn
porary. The price of gold, stocks and the in
terest on money are governed in the long run
by general causes. few men in Wall street,
or even combination of the banks, cannot
change the financial situation materially Tor
any length Of time, however rich or poweriui
they may be- If gold, which was qaoted at
ll2 few weeks ago, is now ll5 OF ia, there
is some general cause for the difference. 1t is
the same with stocks. Let us look, then, at
the financial situation of the country, the
causes of that and the prospect before us.


We seem to be swimming along on the tide
of prosperity, and, in fact we are. as far as the
wonderful and varied resources of the country
and the remarkable industry of the people 60.
There appears to be hardly any limit 10 these
Millions of acres of wild land in the vast
regions of the West are year after year made
to blossom as the rose by the hundreds of
thousands of emigrants and enterprsing
Americans who keep following the setting SUM-
Cultivated farms, villages, towns, railroads
and States spring up as by magic, while the
previously settled territory left behind con-
tinues to improve and increase in population.
Our productions and wealth augment sur
prisiigg..yy every year. There is no want or
necessity for want There - - abundance 'or
all, except for those vagabonds who will not
work. In every direction and in every de-
partment Of industry there are the same general
progress and well being Of the people. 1t is q
spectacle to make glad the hearts Of states
men, of political economists and of all who
delight in the progress and happiness Of lhaG-
kind. 'l'sr' ~ -, :
But with all our blessings and advantages
the country is in an anomalous and unhealthy
condition as regards financial matters, and is
tending, we fear, to dangerous crisis.
Although we have a cotton crop worth two
hundred million dollars and upward, of which
the greater part by far is exported and is
equivalent to gold, and large expectation Of
tobacco, cereals, -four and other products, the
balance of trade is always largely gainst u.s.
Last year the export of precious metals to
help to make up this balance amounted to
about eighty millions, fully twenty millions
over what was extracted from all our mines.
Every dollar Of gold aud silver we can pro-
duce each year is drained from us for this pur-
pose, and too often the old reserve of specie in
the country is reduced, as during last year.
But this is not all. Our national securities, as
well as other securities continue to flow
to Europe to pay for the extravaganza Of the
people, and to make up the balance against
us. If we got gold in return, or something
that would not waste away, it would not mat


ter so much but these bonds, as well as all
the specie we can extract from the EARTH go
to pay for silks, satins, wines, jewelry and a
hundred other Injuries which are consumed.
What is the consequence? We are getting
deeper in debt to Europe continually and every
year a larger amount of gold is demanded to
pay, not the principal, but the interest merely
on this foreign Indebtedness.


1t is often said that gold and silver are CON-
modites of trade the same as cotton or
tobacco. This is true only in part. Intrin-
sicsly they are merely commodities of trade;
but as they constitute the money of the world,
or at least, are the basis of money, and as
we have thought proper, even with
paper currency, to adjust our finances
on that basis, they more than
commodities have been made the very
life-blood Of commerce and the representatives
of all values. If we had a monetary system
oro nd pot inf,
from abroad the precious metals would be
then purely commodities of trade As long as
we follow the nations of Europe and make
them the basis Of values, including the value
of currency, we must suffer whenever the
quantity we have on hand is reduced, or be-
comes relatively less than that held by other
nations. This is 80 self-evident that child
might understand it, What, then, is the pros
pect if we continue to export more than
all the gold and silver we annually pro-
! duce to pay for our luxuries and the balance
Of trade against us? OF course we shall be
short Of specie relatively to the wants of trade
and population, and when crisis comes will
be overwhelmed by disaster. Since the dis-
covery of gold in California that State
and the other gold and silver producing
States and Territories have yielded one
billion four hundred million dollars in gold
and one hundred and twenty million dollars
| in silver. What has become Of it? Gone, as
we said. to pay for the balance of trade against
us. 1t is doubtful if we have as much of the
precious metals now as we had twenty years
ago, or when the population was a third less
than at present and the wealth of the country
hardly more than half This would not matter
if we did not make gold and silver the repre-
sentatives Of value; but as we do we must
suffer the Inconvenience. The nations that
draw from us specie so constantly and largely
have il cheap and low rate of interest,
while with ns il Is dear and we have q hiQh