Democratic Sentinel, Volume 2, Number 8, Rensselaer, Jasper County, 5 April 1878 — One Phase of Resumption. [ARTICLE]

One Phase of Resumption.

The Resumption act orders that on the Ist day of January, 1879, not ton months hence, the Government shall redeem all greenbacks then outstanding in coin. The difference between the “ irredeemable” greenback and gold is to-day but 1 per cent. This fact is an unanswerable tribute to the Government credit currency of the United States. Equalization is not resumption. The appreciation of the greenback dollar is not its redemption in coin. It is known to all the world that the Government has no coin at all in which to redeem its notes. Of these there are about $340,000,000 outstanding. There are national-bank notes to the amount of about $320,000,000, and these are made redeemable in lawful money. When greenbacks are no longer lawful money, or when they shy into the treasury in hot haste for coin, the national-bank notes are redeemable in coin unless something else, meanwhile, is made lawful money. Under existing law, therefore, the national-bank notes and the greenbacks will be redeemable in coin on the first day of next January. About $660,000,000 of gold and silver coin will be required for this purpose, nearly all of which must be accumulated before that date. The Silver bill will enable not more than $40,000,000 of silver dollars to be coined within this period, and there is little or no gold available for resumption purposes. Under the State-bank system men only cared to know that the bank had the money, the coin, and then they didn’t want it If the bank hadn’t it men wanted it vociferously. The public was entirely ignorant of the condition of thote

banks, of the amount of coin they hai The public belief was that the oom wa< ready when the bank notes should be presented. Now, everybody knows th al the coin is not in bank for the-national-bank notes, and that the coin is nbt in the treasury for the greenbacks. The holders of those notes, therefore, knowing this fact, will be anxious for that coin. There will inevitably be a “ run *' on the treasury and on the national banks for coin. The greater the “ run ” the greater the relative value of the coin, and thus the “run” will constantly stimulate itself, by presenting constantly increasing temptations. An exceptional and enormous demand for coin is created, the supply remaining unchanged, and the holders of these notes alone are by law privileged to buy coin at 100 cents on the dollar. The result is easy to foresee. By the terms of the Resumption act the greenbacks, once redeemed, cannot be reissued. This slearly throws the burden of the redemption in coin of the paper money upon the national banks existing next January. But this is only one feature of the Resumption act. The depositors of the country have deposited lawful money, or what was accepted as such, and are entitled to receive lawful money in return. Under the operation of the Resumption act greenbacks will be buried or burned, and no national bank will allow a note to go out because it is redeemable in coin. The depositors, therefore, must be paid in coin. Let us look at the effect of this. In June last the deposits in the banks amounted to $2,120,113,395. The banks will be called on to pay these deposits in coin. Deposits will have become valuable. Checks, etc., will have been deposited in bank as money, and have been used as money, and the deposits must be paid in money. Money will then mean coin, and the banks will be called on to take their own medicine. The banks are the money-lenders. When they are invited to pay $2,000,000,000 of deposits in coin, may we “be there to see.” The Senate of the United States has the Resumption Repeal bill tinder advisement Its Finance Committee has postponed its consideration from time to time. We suggest to that august body that they contemplate this phase of resumption before they fail to concur with the House in repealing the Resumption act. In saying this we are not specially moved by compassion, for the banks shovel everybody else into misfortune before they tumble in themselves.— Cincinnati Enquirer.