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if upon an exchange of these checks through the clearing house,
each day, the accounts were not balanced, all that was required
was an arrangement between the banks for adjusting the bal
ances, and this was done depositing specie, or bills receiva
ble, with a bank or trustees-mutuaUv chosen,’thus creating a
fund, a check «pon which was received in payment. It was
thus that the' credit of the banks was made the basis of these
operations and enabled the merchants of New York to move the
immftase mass of commodities, which entered into their domes
tic and foreign trade of that year, and of which the exports of
Confederate States constituted the greater part.
In further illustration of the extent to which credit may be
used uuder the improved machinery of commerce, we refer to
the fact, stated by Chevalier, as translated by Mr. Cobden, that
by the official returns of the banks of England and Wales for
ten years, from 1846 to 1856, the annual average circulation of
bank notes, had diminished $7,962,500, whilst by reference to
the stamp office, it appears that the use of bills of exchange had
increased at the rate of $90,000,000 per annum, and that with
a circulation of $155,005,135 of bank notes in the United King
dom, there were at a given moment, in 1857, $900,000,000 of
bills of exchange in circulation; shewing most conclusively how
small a proportion of4be precious metals is required to maintain
the value of oredit under a well regulated system of commerce.
By the offioial returns to the Treasury of the United States,
ending July, 1859, it appears that
The EiporU o::»hc Coofadorate State*, were, $177,503,863
Wbllal flielr Imports were but
Leaving an access of Exports of $154,897,007
The Import* olNew York, PeuiujrlvanU and Massachusetts, were $986,88^915
Their Exports <M6,9h,784
Making an excca* of Imports of *. $100,314,441
This excess of Northern imports are paid for by the excess
of Southern oxports. Tiie process of payments was thus. A
Northern or European Banker came to New Orleans, Mobile,
Savannah or Charleston, and purchased or made advances on
cotton or other pioduce, and paid, not in money, but by a bill
of Exchange on New York, which bill upon New York was paid
by a second bill upon London, and the billpn London w<’s paid
by the products of sales of cotton in Liverpool. The cotton in
transitu was the basis of the bills of exchange, as well as those
upon London, as of those upon New York, jand the Southern
planters, through the agency of the Northern and European
Bankers, placed in London this sum of $154,327,067, to the cred
it of the banks of New York, which had purchased the second
bills of excbauge. The New York banks purchased these se
cond bills upon London^ because the merchants of New York
purchased goods ia Manchester and Lyons and therefore want
funds in London and Paris, and the banks in New Orleans, Mo
bile, Savannah and Charleston purchased the first bills on New
York, bccanse the Southern merchants purchased goods in New
York and therefore Required funds in New York v
When we take into account the fact, that, large quantities of
cotton, tobacco, flour and naval stores, produced in the Confed
erate States, were included in the exports from New York, it
will be seen that, inasmueh.ns the surplus products of the South
constitute so large a part of the basis of the trade and industry
of European nations, we have in the Confederate States .ample
resources fbrsuch a regulation of the foreign trade as will protect
us from those “ continual fluctuations” in the money market of
England which hate under the system of foreigh trade of the
I T . States produced such ruinous contractions and expansions of
the values of property.
Again. By referring to the table given above, it will be seen
that although the Bank of England suspended specie payment in
17!»7, and did not resume until 1825, the Bank of England note
was equal to gold in 1800, although the public credit had depre
ciated 5Si per cent. Why was the public credit, whibh paid a
dividend of three per cent, depreciated 58J per cent, below the
credit of the bank note, which did not pay specie and paid no
dividend, when nearly the whole capital of the bank was invest
ed in that depreciated public credit, and tbe bank bad a circula
tion of $75,800,000? Was it not because the bank note was used
as curreucy,aud was therefore subject to the laws, which regulate
the relation between the values of money and of property, whilst
the public credit was property and was bought and sold as pro
perty, and therefore subject to the laws, which regulate the re
lation between the values of property and of n^pney?
If this be so, (and is if not proven ?) should not the Banks, Rail
Rond Companies, Merchants, Manufacturers, Laborers, Plant
ers, farmers, all tbe people of the Confederate States agree to
receive and pay out the Treasury notes of the Confederate States,
as money, aud thus make them available as currency, since be
ing fundable, in caso of depreciation, as before said, they will
be funded so-as to reduce the quantity in circulation to the sum
requisite for currency ? •
ludeed we believe that, as soon as we have-peace, the gov
ernment may reduce the rate of interest on the funded debt to
five, instead of S per cent, or even less. Those, who have funds
to invest will soon realize that a bond of tbe Confederate States
for twenty dollars, bearing an interest of 5 per 100, will in one
year become t .venty one dollars; whereas twenty dollars in gold,
as we will presently show, instead of bearing interest and in
creasing in value, as the Treasury note, whei^ funded, will do,
will become from year to yew less and less valuable.
Jacob’s estimated that there was in Europe at the time of tbe
discovory of America,
' la Gold aud Silver, $179,000,000
And in J599, 650,000,000
“ mo, 1,485,006,000
“ 1800, r 1,900,000,000
“ 1820 1,566,948,800
It is admitted by all that the effect of the increased quantity
ba.; been to diminish the value of Hie precious metals. Cheva
lier estimates that the vaIuo of silver has fallen as 6 to 1. and of
gold as 4 to 1, and argues that if the supply of gold from Aus
tralia, Siberia and California continues the same fbr ten years
from IS57 os it then was, the value of gold will be reduced one
lialf. lie estimates the entire produce of gold from tbe Ameri
can mines, (which was Alia ohief source of supply) from 1492 to
1848 at $2,007,900,000, and argues that if tbe increased annual
supply ia but $175,000,009, wbich he asserts to be loss than tbe
real sum, then the increase in tea years will be $1,750,000,000.
He cellmates the tarn to be used as currency In States now
start or gold at $350,000,006
To meet Increase of population and commerce, 154,000,000
For currency of the world, 154,((00,600 .
For wear and tear In ten yasra, 105,000,000
ForueeofJewalert,Manufacturer*, Ac., , 2*5,000,800
Making 803,500,000
Leaving to act on prices, $857,500,000
Ho argues that tbe effect of this increased supply of gold will
be to reduce the value of fixed incomes, (salaries, bonds, mort
gages, Ac.) one half in ten years, whilst Mr. Colwell says that
“the whole depreciation of the precious metals produced by this
increased quantity does not, measured by the rise in prices, ex
ceed from 400 to 500 per cent., whilst their volume has swelled
to 1500 per cent.” But it is admitted by all that the resulting
consequence of the great increase of gold will be to reduce its
value and to,increase the value of labor and other property in
the ratio of the depreciation of tho precious metals. It is well
known that the most astnte bankers and capitalists of Europe,
now prefer rail road shares to bonds as an investment, because
the receipts of rail road companies will increase with the in
creased activity given to industry and commerce, by the increase
of the precious metals and the increased price of labor and its
products. It follows that if this increase of gold shall diminish
the valne of the funded debt of Europe, there will be an increas
ed tendency to invest in onr rail road shares, because tho pro
ducts of the Confederate States, which constitute onr exports,
must (the greater part of them) pass over our rail roads, and the
stimulus given to European manufactured by our system of free
trade and increased consumption consequent on the increased
activity of labor and of commerce, will so increase transporta
tion and travel as to greatly increase tbe profits on the capital
so invested. As with Treasury notes as u currency, we can ex
tend our system of railways and the value of our funded debt
will depend on the rate of interest, our railway shares and fund
ed debt may, if we desire it, be placed in: the European market
in sums sufficient to strengthen our syste m of exchanges so as to
1 itect ns against any attempt on the part of the Bank of Eng
land to coerce an undue export of our sp<cie. For as tho ucoof
our produce is with the pooplo of England a necessity, and the
use of their manufactures is to us a convenience, it is apparent
that, having a paper currency sufficient to supply our domestic
exchange and move the body of our exports, we could by our
exports so regulate our foreign exchange as to give us “a money
market undisturbed by continual fluctuations”—that desidera
tum so long sought for by the political economists and statesmen
of England.
As the purpose of giving to Congress the power to coin mo
ney and regulate its value and inhibiting the States from making
any thing but gold and silver coin a tender in payment of debts,
was to give a certain fixed valne to rffoney, and thus give a cer
tain aud stable valne to credit and property—it would seem
that it is no less the duty of government to counteract as far as
practicable, all other oauses, which may tend to depreciate or
render uncertain the values of credit and property, which it was
the purpose of the Constitution to protect. It was in conform
ity with this principle that the great Lawgiver said to Moses,
“If thou lend money to any ot my people tbatls poor by thee, thou shall not be to
him as an usurer, neither shalt thou lay upon him usury."
“ Ye shall do noTtnrighteousness In judgment, In meteyard. In weight orin measure,"
“Just balances, just weights, a just ephah and a just him shall ye hate. Iamthe"
Lord, your God, which brought you out of the land of Egypt.”
It is-because money is the measure of values, as me yard -
stick is the measure of cloth, that the laws of most civilized na
tions forbid its being made a commodity, (to be purchased and
sold as other commodities are. For as the legitimate use of mo
ney is to measure tho values of commodities, which are purchas
ed and sold in the market, the effect of fluctuations iii the value
ot money is the same as the effect of fluctaations iu the standard
of weights and measures. Thus if A, were to contract to deliv-
to B. 100 bushels of wheat or 1000 pounds of beefi on a given
day, and the bushel measure or pound were to be changed, so
as to-require A. to deliver a greater or less quantity of wheat or
of beef, all men would say that such change in the measure or
weight would be unjust. Surely no one will deny that, as the
Constitution has given to Congress power “ to fix a standard of
weights and measures,” Government should discharge that duty
so as to prevent, as far as practicable, auy such change in the
weights and measures used in the operations of trade. All men
agree in this - r because a change in the' weights aud measures
would como home to the every days experience of all, and the
effect would be so palpable that all would condemn it. If, as
we argue, the frequent recurring expansions and contractions
of tbe currency of England and of the Uqited States are the re
sult of the measures adopted by the Bauk of England to obtain
supply of bullion, which byact of Parliament regulates the issues
of that bank^ and tbe effect of such expansions and contractions
of the currency be to increase or to lessen the values of credit and
of property, it is apparent that such expansions and contractions
are in effect the same, and* will work the same injustice between
man and man, as if Government were to permit the size and
weight of weights and measures to be increased or diminished.
Is it not obvious that the duty, imposed by both these grants of
power, is tbe same; and that it is as much the duty of Govern
ment to fix, as far as practicable, a standard value of money, as it
is to fix a standard of weights and measures ? We admit that one
is more difficult than the other, because -the valne of money de
pends on the regulation of our foreign as well as of our domestic
trade, and our weigbt»and measures may be restricted to our do--
mestic use. But this difference in the subjects of these two granted
powers, does not release the government from the obligation to
make the appropriate provisions for each. Therefore as the value
of our gold and silver coin is subject to the continual fluctuations
resulting from the expansions and contractions of tbe Bank of
England, if it be possible to do it, is it not the duty of our Con
gress, under the clause which.gives them power to regulate the
values of money, to give us a currency having all the requisites,
for our own use, of gold and silver, and which, whilst it will en
able us to send into the foreign market all our surplus products
as well as gold or silver could do, will not be subject to the ac
tion of the Bank of England and will therefore be free from the
continual expansions and contractions aitd consequent fluctua
tions in value of gold aud silver ? • * .
Whatever else may be said of the government and people of
England, none can question the comparitive extent of their com
merce or tlreir wealth and resources as a nation. The density of
her population and the necessities of her commerce require a
general distribution of labor, and it is an important fact that
whilst, by tbe use of her machinery, she is enabled fbgivo such
employment to her labor as to create her immense resources, she
is dependent on the Confederate States for the chief supply of
the raw material, which constitutes the basis of so large a part
of her industry and prosperity that it may well be said that we
are one of the main pillars of her strength and influence. Eng
land is therefore dependent on us for the maintenance df her
wealth and prosperity. It is her policy through her commerce
to create a balance against other nations to be paid at the plea
sure of tbe Bank of England in specie, because she thus regu
lates the exchanges in favor t)f London. Yet as she is depend
ent upon the Confederate. States for so large a supply of the raw
material, it is obvious that these States may create for themselves
a domestic outrency, which can place our exports in onr sea
ports and purchase-whatever we may Want of British merchan
dize, and if we desire it, create a balance to be paid to ns iu
specie. Thus we may, through onr exports, use the Bank of
England itself to regulate the exchanges of the world in onr fa
vor. We need not repeat what we have already said to prove
that the proposed Treasury notes will give us such a currency as
we have described.
In further illustration of the valne of mongy we give a table
bliowing the minimum rates of interest charged -by tl^e Bank of
England for a series of years from 1844 to 1857:
Date I Jan. Feb. Mar Apr May. June July. Aug. Sept. October Not. Dec.
18441
1845
1846
1849
UN
1861
1853
1868
1864
1856
1856
1867
3 *
8* »
6*
5*
4* *
3*.
3*
i*
3
65*6
t>*
»x
44*5
<4*6
l
6*6
It will be-seenthat the rate of interest charged by the Rank
of England has daring the 14 years here quoted, changed as often
as four times in one month, and varied from two to tea per cent.
What would be said of a regulation of weights and measures,
which would permit such variations in their weight and size ?
Would any civilized people permit it? We think hot, and yet
such changes in weights and measures would not effect so inju
riously tho values of property, because from the nature of things,
every purchaser would first agree upon the weights or measure
to be used, and wonld thus regulate quantities for himself. Bat
in tbe case of money, that .would be impossible, for as the
value of money, as regulated* by the 'Bank of England, de.
pends on contingencies which it is impossible for either of the
parties to foresee, it is therefore impossible for them to ascertain
or agree npon tbe effects, which the regulations of the Bank will
have upon the values of property. Therefore it is much more
the duty of the government to take these facts into considera
tion, and as far as practicable protect the people of the Confeder
ate States against the derangements of the values of property,
which are aud must continue to be the inevitable consequence
of undue contractions and expansions of the currency ^through
the Bank of England. -
To show that the variations in the rate of interest as quo
ted from the returns of the Bank of England are not an indis
pensable part of the banking system, we give the variations in
the rate of interest charged by the Bank of France for a period
of 37 years :
From 20 Feb., 1800, to Nov. 13/1806, the rate was .6 per cent.
14 Nov., 1806 to 4 Aug., 1807,
5 Aug., 1807 to 38 Feb., 1814,
1 March, 1S14. t/> •• ’MM jo14 -
• —S-. 1S14 to 81 Aug., 1814
1 Sep., 1814, to 91 May, 1819,
1 June, 1819, to 31 Jan., 1830
1 Feb., 1830, to 13 Jan, 1847,
14 Jan,, 1847 to 36 D*C^1847,
JT Dec., 1817, to 3 March, 1852
2 March, 1853, to 6 Oct., 1863
7 Oct, 1853, to 19 Jan, 1854,
* Jan., 1854, to 11 May, 1854,
8 MAy, 1851, to 4 Oct, 1855,
5 Oct., 1855, to 17 Oct, 1855,
15 Oct, 1855. to 30 March, 1856,
SI March, 1856, to 34 Sep., 1856,
25 Sep., 1856, to 34 June, 1857,
25 June, 1857, to 1 Sep., 1857,
..4
..6
..4&5
..4
..5
..4
..5
.6
.5
.6
.6*
Boes not this table prove conclusively that the fluctuations
in thj rate of interest made--by the Bank of England are not
a necessary.part of the banking, system ?
Another striking fact bearing on this question is, that whilst
the Bank of England, with a view to command the specie
wanted for the expenses of the jyar in the Crimea and in India
and China, increased the rate of interest from 2 per cent, in
1852 to 10 per cent, in 1857, and'thns compelled the merchants
and manufacturers of England to purchase the silver, which was
the currency of France, the Bank of France purchased $272,*
JJ0U,VW ot gold, at a cost of $2,800,000, to supply tbe place of
the silver, which had been sold to England! The effect of the
high rate of interest and the contraction of the currency by the
Bank of England was to throw on the commerce of England the
onus ef supplying the specie wanted to defray the expenses of
the war in the Crimea and in India. * But it created so great a
demand for money and so enhanced its-yalue as to so change
the relation of debtor and creditor, that tbe losses were many
times the entire sum so expended bv.the Government. Where
as the entire cost of supplying the $272,600,000 of gold to the
currency of France in lieu of the $225,400,000 of silver, which
she had lost, was. but $2,8$),000, a comparatively small sum,
which was much more thfiif compensated* for by enabling the
Bank of France to cqjitimfe fye eritire^ine of its discounts, thus
sustaining the industry aud commerce of France. If we con
trast the measures and policy of the Bank of England with the
measures and policy of the Bank of France, we find that whilst
the Bank of England carried ruin and bankruptcy wherever
its influence could reach, and especially throughout the United
Kingdom and the United States, the Bank of France, by keep
ing tbevolnme of her discounts and the currency full, protected
the industry and commerce of France and by giving employ
ment to her people, made France, even in the midst of war,
prosperous and happy, and enabled the wise sovereign of
France to relieve his people from the burden of the war by plac
ing among themselves his Treasnny notes, in sums varying from
5 francs to 1,000, for an amount equal to the increased expen
ses of bis Government. This fact is a further illustration of the
capacity of a people to absorb a public debt, if issued to the
people themselves in a shape which enables them to use it as a
currency or to hold it as an investment.'
The proposition submitted to the people of the Confederate
States, as we understand it, is that the people shall ngree to
land to the Government such part of their produce as may not
be requisite for their own support, and receive in payment the
Treasury notes and Bonds ef the Government. Would it not be
a much more simple measure for all the creditors of the-Gov
ernment to receive the Treasury notes of the Government in
payment, and for the several States and all Banks and corpora
tions and all the people to receive and pay out their notes as
money ? If so, then the entire issue should, iu the first place,
be in Treasury notes, made fundable at the option of the holder,
because in that case we will not only save the interest on the
sums requisite for currency, but we would get a currency bet
ter than gold or silver, because it will perform all the functions
of specie and not be subject to the influence exerted upon a spe
cie currency by the Bank of England.
Some apprehend that the effect of a large issue of Treasury
notes, as currency, will be to limit the circulation of bank notes,
so as to lessen the profits of the Banks, and that, therefore, they
will refuse to receive and pay out Treasury notes. We have
seen that the purpose of giving to Congress power to coin mo
ney and regulate its value and hffixa standard of weights and
measures, was to “establish jnstice” between man and man •
by giving a fixed and stable value to money; that the effect of
the measures and policy of the Bank of England is to defeat
that purpose by repeated contractions and expansions of the
currency of England* which cause constantly recurring, fluctu
ations in the value of money and consequent fluctuations in the
values of property. That the purpose of these contractions is
to throw upon the commerce of England the onus of recruiting
the bullion wanted for the Bank; and that the effect of the
measures of the Bank is that, instead of receiving the staple
products of other nations in exchange for their exports* as un
der a well regulated system of free trade the merchants of
England would do, they are compelled to demand specie,
because the process of compulsion on the part of the Bank is
to require payment of debts due tho bank ; and as nothing but
gold or silver or Bank of. England ^jotes will be received in
payment, instead of receiving cotton or Titlier American pro
duce in exchange for his goo <s. the British merchant is com
pelled to demand specie. The effect of that demand is illustra
ted by the facts stated by Mr. Colwell, Vho says:
“ In August, 1857, the loins qf the New York Banks amounted to $122,000,000, and the
deposits to $94,000,000. in th*_ middle cf October the loads had fatten to $97,000,000, and the
deposits to $52,000,000. Thus the Banks Were compelled to withdraw from the public $66,000,-
000 of paper currency to keep $12,000,000 qf specie In their roqUe."
Tljc wuoT-j—«— -f 41.1- ion Uj- tlio Hqulra of 2tTow.
York was to arrest the progress of the industry of the United
States, and by spreading ruin and bankruptcy throughout the
land to diminish their own business and profits.
It is important that we should fully understand the. process,
by which the Bank of England; regulates the exchanges, that
we may rightly appreciate its effect on the currency of other
nations having trade witlj England. We therefore repeat that,
wanting silver Jo pay the expenses of the war in India, the
Bank of England -paid a premium sufficient to cause an export
of silver from France of $225,400,000, and that instead of cur*
tailing its disconnts r .and thus arresting the progress of tl© in
dustry of France, the Bank of France purchased $272,600,000
of gold to supply the place of the exported silver, and was thus
enabled not dhly to keep the volume of its circulation full, but
to continue specie payments, whilst the Banks of New York,
following the example of the Bank of England, curtailed their
discounts nearly one-half in their fruitless efforts to continue
specie payments. Thedontrast between the action of the Bank
of France and that of the Banks of New York and the resulting
effects, shows that the Banks are most prosperous when the
community are prosperous; that the solvency of the Banks de
pends on the solvency of those whose notes are discounted by
the banks; and that their profits depend on the stability of
the values of - property, for upon this depends, the ability of
those who may be indebted to the Banks to make punctual pay
ments.
We have seen that the Bank of England may at any time,
by refusing to renew their discounts, compel the merchants of
England to refuse to receive oar exports in exchange for their
goods, and that the effect under the present system will always
be to cause such an export of specie as to compel our Banks to
contract their discounts, and thus greatly lessen their profits.—
We believe and argue that. Jreasurv notes are fundable at
the pleasure of the hdlcler, iWnll prevent their depreciation ;
and that inasmuch as these notes will create an abundant and
cheap currency, equal to gold and silver for the purpose of do'
mestic exchange, but Vriiloli Win not be convertible, into specie,
and therefore will not be, like bank notes, a medium by which
our specie can be withdrawn from eur banks for export. There
fore the issue of Treasury notes, by creating an abundant and
cheap currency, which will be stable in value, will relieve tbe
Banks of tbe Confederate States from their dependence on the
Bank of England and the foreignexchange, as.regulated by that
Bank, and by giving a healthful stimulus to tbe industry of the
country, so increase the business as to enlarge the profits of the
Banks. For the profits of the Banks depend much more upon
the extent of their business and the certainty of punctuality in
payments than upon the circulation of their own notes. In
proof of this, we refer to the following statement of tbe capi
tal paid in, tbe deposits and current liabilities, and the dividends
of some of the Banks in London:
Bank. Capital paid la. Deposits and liabilities. Bate of dir.
London and Westminster (.'>,000,000 $69,606(295 18
London Joint Stock Bank 3,000,000 53,492,650 23*
Union Bank of London 8,000,000 54,373*200 20
It will be seen that, although these banks are not authorized
to issue their own notes, -the proportion of paid up capital to
the deposits and current liabilities of the London and Westmin
ster is but seven per cent., whilst that of tbe London Joint
Stock Bank is but 54 per cent., and of the Union Bank it is but
6£, giving to one Bank 18, to another 22£, and to the other 20
per cent, as dividends.
We might give detailed statements and trace the causes
which have led to tbe insolvency of Banks in the United States
and in Great Britain, to show that, although there have been
cases of dishonesty, they were chiefly tbe result of fluctuations
in the value of property, caused by derangements of thd cur
rency, attributable to the causes we bane endeavored to explain,
and thus show more couclu&ively that the Banks, as they deal
in credit, are of all others most interested in protecting the
valne of credit by giving stability to the currency. But we
hope that the relation between the quantity of bullion in the
Bank of England and the value of money in London and the
money market of'the United States is now so well understood
that farther illustration is unnecessary. We therefore conclude
by a brief reSTime of the points made and facts cited in the
course of pur remarks. • .
Money is a token issued by Government and made a tender
in payment of debts.
Nothing but gold and silver coin is a tender in payment of
debts in the Confederate States. Therefore nothing buf such
coin is money.
Bank qf England notes are in England a tender, and there
fore those notes, as well as gold and silver coin, are money in
England.
Tbe money which circulates in any country and by means
of which the produce of its lands and labor is distributed to the
proper consumers, constitutes a very small part of the aggregate
value of its property; because all beyond the sum required to
make the transfer is a dead stock, which produces nothing; and
therefore as the healthful action of the body regulates the quan
tity of blood requisite for the proper support of the vitality of
the human system, so the healthful action of commerce will
regulate the sum of the precious metals requisite to the discharge
of their proper functions in the operations of trade.
The use of money is to measure the values of property as
the use of the yard-stick is to measure cloth. It is therefore as re
quisite that there should be a certain and fixed relation between
money and property as that there should be a certain and fixed
standard of weights and measures.
As the the relation between the gold and silver and the
property in the Confederate States is liable to repeated and
ruinous fluctuations caused by the expansions and contractions
of the Bank of England, which are avowedly intended to com
pel the merchants of England to bri ig back to the Bank tbe
specie it wants; and as under the system of trade with Eng
land as regulated by the Government of the United States, a
large part of the specie wanted by that Bank has been taken
from the United States; and it is apparent that if the Confed
erate States adopt the same system of currency, the proposed
free trade between them and England will give increased facil
ities for the export of the specie requisite to maintain the proper
relation between tbe quantity of specie and the values *of prop'
erty in the Confederate States, it Js the duty of Congress, as
far as possible, to protect the currency of these States from the
effects of the measures and policy of the Bank of England.
We arguh that this can best be done by the creation of a paper
currency, not liable to be converted into gold and silver, and
which, being fundable at a proper rate of interest, will at all
times maintain a stable valne, and therefore be equal to gold and
silver in the movement of the produce of our soil and labor.
Aa the stability of the values of property depends upon the
maintenance of the requisite quantity of money, and the health
ful action of our domestic commerce will ascertain and properly
distribute the sum requisite for this purpose, Congress having
fixed the fineness, weight and description of gold and silver
eoins, should prevent, as far as practicable, an undue distnrb-
anceof the precious metals resulting from any extraordinary de
mand for them in the London market* This, it seems to us,
can best be done by the issue of Treasury notes fundable as
proposed. The notes should be of small denominations, with
out interest, st> as to answer all the purposes of currency. The
value of such a currency has been fully tested by the use of the
notes of the suspended banks, and by t-ho French loan for the
war in Italy, which was issued in denominations as low as five
francs (less than one dollar).
The extent to which credit resting on a proper basis may be
used in a well organized system of commerce is exemplified by
the fact, that whilst tho average quantity of money (Bank of
England notes) used in England and Wales, during the ten
years from 1846 to 1856, bad diminished nearly $8,000,000, tbe
sum in tbe shape of bills of exchange had increased at the rate
of $90,000,000 pec annum!! there being at one time $900,000,-
000 of such Bills in circulation!! and the Banks of New York,
with $8,000,000 of bank notes, were, after tbe suspension in
1857, enabled, by the aid of bank credits, to do a business of
more than $50,000,000 per day > without the use of a dollar in
specie.
In further illu-tration of tbe value of public credit, and of
the extent to which it may be used by uu intelligent and indus
trious people, it may be well to repeat that the first census of
Great Britain was taken in 1801, and although the population
then was but 10,567,893, their public debt was, in 1855, $4,-
017,476,9?5, and the annual charge on account of it was $140,-
929 790. Yet it was distributed among 540,208 of their own
people, of whom 185,1S1 were entitled to dividends of but $25
and under, and in 1856,1,281,926 persons had deposited in the
Savings Banks to the use of the Government $161,243,220, of
whom 135,104 had deposited sums of five dollars only, or less.
We repeat these figures and statements that the people of
the Confederate States may realize that the proposed loan may,
by the use of Treasury notes, be taken up by themselves; that
to the extent that these notes are used as currency they will be
a better currency than gold and silver coin, or the notes of spe
cie paying banks, for whilst their value will be the same as
gold and silver, they will give stability to tbe currency and to
the values of property, because they will not be liable to be
carried to the vaults of the Bank of England, and as they
should bear no interest, they will to the extent of their, issue be
a saving of that sum in'taxes.