Moneys of Metal, and Promises on paper.
[from the Charlotte (N. C.) Bulletin]
The gradually increasing differences in the marketable value of gold and silver, compared with paper moneys of every description, throughout the South and West, may be explained without reference to exertion upon the part of any one--‘"to force a peace or to depreciate the value of Confederate notes"’--according to an idea suggested by ‘"Publicae,"’ in the Charleston courier, of the 12th instant. In consequence of the complete suspension of collage at all Southern mints, with simultaneous interruption of foreign commerce, gold and silver have been hoarded by banks and by private individuals. Such valuables daily diminish among us, smuggling to the North; because certain articles of urgent necessity, expensive drugs, for instance, can only be obtained by means of gold. Coin is demanded in the West for purchase of meats for Commissaries' stores, as well as for arms and ammunition in Europe. On the contrary, the uses of paper money are limited in extent by our own borders; while the a mountain State or Confederate notes and bonds has largely increased, by imperative necessity to carry on the war. There is plenty of paper money everywhere among us, with an obviously diminished supply of gold and silver coins. Larger sums, in paper money, must consequently be paid for gold and silver by a common lam of trades, as we are entirely cut off from foreign coins, in exchange for produce.
During a period of fifteen years, according to official proof, the product of gold from Southern mines, in the Carolinas, Georgia, Alabama, Virginia, Tennessee and New Mexico, approached the sum of eighteen millions of dollars. The annual average supply of gold for that series of years being, consequently, equal to twelve hundred thousand dollars, some advantages might be felt in the Confederacy at this time, by an exertion to coin native old, to meet the great demand for its important, well appreciated uses.
By simplification and management in the details of expense, a seigniorage, or charge or five percent upon the value of deposits of bullion, would most the cost of fabrication into coins, without other appropriation by the Government than a permanent fund to pay depositors a full equivalent for their bullion, directly after assay, according to usage.
A law has been drawn up by the Confederate Congress to establish assay offices at the mints in North Carolina and Georgia, without privilege to coin; (a sovereign power claimed by the Confederacy, and not reserved by any State,) also without any permanent fund to provide prompt payment after assay, according to custom and utility. Hence this law seems to be a dead letter, for every practical purpose, that suggested its enactment.
An adequate deposit, for immediate payment after assay, would at once bring an assay office into activity, and enable miners to engage profitably in their wonted industry, which could afford, under existing circumstances, to defray all necessary expenses of manufacture hitherto supported by Government. Whereas, no one appears willing to assume the onerous responsibilities which devolve upon an assayer, under the new law.
The banks in mining districts retain large sums in bullion, which are not now available for domestic exchanges, nor as currency, because it does not possess the form of coins; while the owners of gold bullion pay interest upon advances made in paper upon such bullion Banks with limited capital or restricted charters cannot continue to purchase or make advances, in notes upon bullion beyond a certain amount of their funds, which many have already reached. When our ports are opened to foreign commerce, some foreign coin may be anticipated, and bars of native bullion, the product of Southern mines, may be exported for foreign exchanges, with advantage over coin. But the people of this country, educated by the experience of a former revolution, prefer that the precolons metals be occasionally intermingled with paper moneys in the currency.
We have certainly no disposition to depreciate the value of Confederate, State, or bank paper, but the facilities offered for extended issues of promissory notes, must have that effect in relation to coins. Paper moneys prove extremely convenient in many operations of commerce and trade, as representatives of values, so long as public confidence sustains them. Gold and silver coins serve the same general purpose, with this special additional advantage — that within themselves intrinsically, they possess the very values the others promise to pay.
These two precious metals serve naturally to proportion and rule the values of all commodities Time immemorial, among commercial nations in the East, these metals have borne the same exact ration to each other, in trade, which were carefully guarded, when mints were established in the South, for the purpose of collage.
It is prudent, during, war, to sustain the arts of peace, particularly those which supply bullion and coin for our common currency, graduated by the precise values of the precious metals — especially if such purposes can be effected without serious expense to the Government of the Confederacy, as we believe they can.
Such measures would tend powerfully to sustain mercantile confidence in the bonds and notes of the Confederacy, and all responsible bank paper throughout the State.
