In view of
these diverse opinions, it may be well to ascertain the real value of
our paper issues when compared with a metallic or convertible currency.
For this purpose let us inquire how much gold and silver could be
purchased by the seven hundred millions of paper money now in
circulation. Probably not more than half the amount of the latter,
showing that when our paper currency is compared with gold and silver
its commercial value is compressed into three hundred and fifty
millions. This striking fact makes it the obvious duty of the
Government, as early as may be consistent with the principles of sound
political economy, to take such measures as will enable the holder of
its notes and those of the national banks to convert them without loss
into specie or its equivalent. A reduction of our paper circulating
medium need not necessarily follow. This, however, would depend upon
the law of demand and supply, though it should be borne in mind that
by making legal-tender and bank notes convertible into coin or its
equivalent their present specie value in the hands of their holders
would be enhanced 100 per cent.
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