■>% ^, IMAGE EVALUATION TEST TARGET (MT-3) C' v. 1.0 I.I 11.25 ltt|2S 125 2.0 us Hiotographic 'Sciences Corporalion S ,v •SS i^ c\ \ 33 WIST MAIN STRUT WIISTM.N.Y. MSaO (71«)I73-4S03 \ ^ .<^4,. A ■V^^ .V :y errata led to int ine pelure, apon A 1 2 3 32X 1 2 3 4 5 6 *f^ 143 ». *. '.•AYIHWOK^H. BOOK A*t^ p^^,,^ 1885. I ' j '-'A.' ti w 11 |tHE,MONEY. o^rm FUTURE a mj^m^ *^-^,1l* OEJisra:^ V „ 't (( THE TORPEDO," '■^i A Work on the National Currency Question^ Exposing the False System of Bankings as at present^ and showing the Ad- vantages to be Derived from an Alteration. 1 1^ M.. Wright, Authoe^ and Compiler, DEDICATED TO CAPT. JOHN WYNNE. Fresidewi of the Currency Leagut, ST. CATHARINES : J. LKAVBN WORTH. BOOK AND JOB PKIMl IBSfi. m % r%.'»"^ i ■^ t ^ ■ 4% -Af. i^;. ^^^ tjOv^H-'A^ PREFACE. This work is placed before the public to induce discussion on the subject of a national currency for the Dominion of Canada ; as we want a much larger volume of legal tender currency to be altogether a domestic money of only government issue with a gold value., and, in every way, in lieu of the gold metal, and of course, irredeemable just as much as if it was the metal itself ; and to be considered as valuable, having the Government fiat, making it of the same valae of whatever de- nomination hXt is stamped for the face of the bill. This work also is intended to show some of the benefits to be derived from a large issue of a domestic currency— of Government issue. The compiler of this work does not claim any authorship, but only having time to spare to collect thoughts of others, as well as his own, in favor of a government issue ; a national currency, and has been at some considerable time and trouble in collecting fraginents, extracts from newspapers of the period, bearing and commenting on the currency question ; also sayings of others in favor of it, and showing the fallacy of Uie present bank system ; also the amount deposited in the Government Post Office Savings Blink, and other Government securities ; also a sd^Bii loc ?eposrthe,?SlaSr' Bank of !««„« ,„„ those who have money lei ^ ?/" investment for -^knowledge, "nd Set t w^u'l''^""" ''"«* St. Catharines, Janu ar^, 1885. ^- WIJIGHT. •» . ^- «««**fe* ((h- -"'■* THE HAG BABY. The ghost of the poor little rag baby —the child which the eminent financiers cruelly slaughtered some years ago — has been visiting the Olooe office and frightening the editor almost out of his wits. In Monday's issue of the paper we find a fierce attack on the poor little bantling or waif. If the rag baby is dead, as the Olohe has frequently assured us, it is ghoulish to disinter its lord's, and vampirish to tear its flesh. But if not i, but only mpribund, it is cruel to apply tL^ h so fiercely to the friendless orphan. Seriously, however, the Glohe knows that the rag baby is a growing child, and is daily captivating the hearts of the people. The Glohe understands full well that through the false system of finance which prevails, this county has again been brought to the verge of a business crisis, and would now for political purposes seek to hide the real cause and fasten the blame on the national policy. ''None are so blind as those who will not see." The people are rapidly learning the fact that the most of our financial disturbances have their origin in a false money system, and even the Glole, obtuse as it is in understanding public opinion, comprehends that the time is near at hand when the false must give way to the true. Our contemporary, instead of seeking to blinding the public, should strive to enlighten. We suggest that an article or two on the subject of "money" would be interesting to Glohe readers. The learned editor should tell the country what he knows about the subject he assumes to write on. Abuse is ndthsir ' s-,- 1* ^^i? TORPEDO «tam the right to Cue SiA,^ ''T '»."8''* *<» pnvate banks to \^n\Xj^V^^ ''^^^^i foreign issue, bills of b,;-?!, '^°'^' «» Wis of own and fowigTcnlncvt^f ."^ «>•'« "^ o« »«»eyon no(S. moSe^ what a 1^ *»'( BANK CIRCULATION (1881.) . (KingaUmNew.) Banks must have securities of some kind for their circulation, but not necessarily such assets as could be converted into gold at an hour's notice. A practical turn to this disccssion might be given by starting the question — who should issue paper money ? Should the banks have the profit of it or the government ? These are old questions — questions with which the business men of the country are familiar — but there has never been a more favorable opportunity for dis- cussing them. NATIONAL CURRENCY NOTES. THE CURRENCY BOOM. (1881.) The proposition of the Finance Minister in re- gard to a national currency is clearly defined in the resolutions introduced by him in the House on Monday last, and although it met with some members who are working in the interest of the banking institutions of the country, still it found many staunch advocates who will give the question their hearty support when a division of the House on the resolution is called for. That a national currency is what Canada needs there can be no question ; but it is patent to all who have given the matter of finance their attention, that the line of policy drawn by Mr. Tilley is the tnie one.—- -4rwj9?*/{>r Ghivnicle. d \ 8 The Toronto I^ews pointedly and truthfully re- marks that " the issue o( the currency should be kept entirely distinct from the business of ex- change and money lending. The circulating medium should not be liable to depreciate with the fluctuations of the stock market, or subject to suspicion in consequence of reports derogatory to the stability of a private trading corporation. The government should follow up the action they have already taken with regard to bills of smaller denominations by giving the Dominion a national currency, guaranteed by the government, and not dependent upon the prosperity of the money lend- ing business, or liable to be discredited by the machinations of stock-holdeis." REASON TO FEEL PROUD, (1881.) The currency reform movement is not dead, but on the contrary it is steadily gaining ground. This is a matter of which its advocates have just reason to feel proud. Their ideas have been attacked by the Olobe both editorially and by correspondence, and when it found that its argu- ments were being badly used by its opponents, it then raised a cry for help from the upholders of the gold basis humbug. Several other papers supporting the old banking policy of the past cook up the cudgels, but they have not made out any better case in support of their theory than their Seat confrere. We are pleased to see the Finance inister increasing the Dominion note issue, but WA are not satisfied with this measure further than it shows that our rulers are bejriuning to awaken to the fact that anew departure is necessary with regard to the currency. We want, ^nd the people want a currency that is not based on goid, a currency that will be accepted for all debts con- tracted within this Dominion, and that shall be based upon the resources of the people, a purely national currency. — Orangeville Gazette, The next thing to be done is to extend the amount to be placed to the credit of all persons who may wish to place monies in the Post Office Savings Bank, as there appears to be great confi- dence in all Government securities, but not to be compelled to place it there, but po leave it option- al with every person to act as they like as to where they may wish to place their money. They will soon find out the safest place and place it there. And if possible to absorb all monies and fitocks from private banks into government stocks, and give as much interest as possible from time to time, as at present, and also to issue a scrip de- nomination of twenty-five and fifty cents, as waa issued some years ago by the government, as mer- chants and others found it very convenient to transmit by mail fractional currency, irredeem- able the same as the other bills issued, but to be treated as issued, counted, passed, and to be taken as gold, and as of gold value. The Government fiat does that, for it is the wish of the currency league that all denominations of bills issued by the government should have the gold value. .-s«te*t(J*K»iM«" -M-ii**"*" ' n^'^tfrn^^Wl!^- >*;•■• 10 JUST SO. The Hamilton Spectator claims that "all transac- tions would be conducted for cash only if fiat money were made legal tender." Just S(». Tliat would be the greatest benefit ever bestowed upon the people. There can be no doubt that it would in all respects le better for as individuals and as a nation to bring business down to a cash basis. A more poweriiil argument in favor of a national currency could not be used th^n that advanced by our contemporary. — Journal. THE DIFFERENCE. The St. Catharines Journal tells us that "the only power in Canada to make money is the government." We beg pardon. We have in our possession a five dollar bill issued by the Bank of Hamilton, and it is money. It is money be- cause it promises to pay five dollars to the bearer, and because the people believe the bank is both able and willing to make the promise good. If we 80 desire we can go to the bank to-day, and get five dollars in gold for the piece of paper. — Spectator. We are certainly sui ^jrised that so well inform- ed a journal as the Hamilton Spectator should utter such arrant nonsense. The note of the Bank of Hamilton, or any other bank, is no more money than a note issued by the Spectator Print- ing Company. A note is a promise to pay money. 11 It is entirely credit, and the value of tire instru- ment is simply measured by public confidence; — Journal. WHAT IS MONEY 1 The Hamilton SpQctai>or a^^ain takes up the subject, "What is money ?" and endeavors to re- assure itself that money is gold and silver and not, as the Journal contends, a creation of the law. On this point our contemporary says : "Money is not the creation of the law. The law re;^ulate3 the issue of money. It does not create the vahie of money. Labor creates tlis value. There is no exchan fail it was never questioned but that our private banking system was considered good ; but when a crisis came in our banking system, when the old bank of Upper Canada failed, an institution that was supposed to ^ 26 be stable and perfectly secure, and so it was, as long as it was managed right, on good banking principles ; but Mr. Kidont, who was president, and managed the affairs of that bank, was ad- vanced in years ; too old to manage its affairs, but still honorable ; and with an idea of extending the capital of the bank, and raising the value of the stocks and credit of the bank, at the time the quarterly dividend was declared, gave a bonus out of the reserved fund of the bank, which was more than enough to have redeemed the issue the bank had out at that time, and in circulation. But a crisis in the affairs of the bank took place, and crippled by large loans on land, and notes and se- curities, but locked up in various untangible ways; and when a run on the bank took place, before that could be converted into cash, and not having sufficient in the j^eserve fund to meet the bills coming in at the run, which, if it had not been taken for the purpose of a bonus, to be divided amongst the shareholders or btockholders, would have redeemed the issue ; but not so, and down went the oldest bank in Canada ; and thus it gave our banking system a most severe shock ; and froni that time until the present it has been on the wane ; and on account of so many of our private banks shaking to their foundations, taking the funds of widows and orphans and aged men with them, never to recover, but to starve ; and our banking system as it is at present is not a safe investment. The only safe place to deposit and invest is the Post-Office Savings Bank and any Other Gk>vernment securities, and, until a regular * «. 27 Government bank of issue and deposit is formed, and is au accomplished fact, there is no other safe place. — To^jpedo. SO.\rETHING ABOUT MONEY. The object of money is to make the means of exchange more convenient, the money simply and only representing value for one side of the trade, and doing away with barter altogether. Barter is barbarism — money represents civilization. Money is not a product of nature — nature produces only products. The fiat of government only creates money. That which constitutes the money is not the substance. The law employs a substance through which to express itself. The law can put money either into gold or silver, or take it away at pleasure. In the same way the money power can be vested in paper. Law written on tablets of gold or silver would be no more valuable than if written on paper. Money expressed on^ paper is equally valuable with money expressed on gold. Gold is not money. Money is simply a creation of the law. "The book," says Porter, "is not the law — the law is the ideas expressed in the book. Coin is not money. The idea of money is ex- pressed in the coin. It i« the fiat of the law/' But, as argues our friend of the Spectator, the government cannot create value. Well, as a matter of fact, there is only a difference in degree between the fiat of governments over the value of paper money and the same power over silver and gold. It is true that when mints are open to ^■<^-r^: :'. 28 everybody, the value of gold and silver coins is the same as that of the bullion contained therein. So that a first impression wonld be that *»overn- ments in no way effect that value. "Neverthe- less," says the Bankers' Magazine, "governments do effect the value of the bullion by decreeing that it shall be the material for coin. Gold and silver coius are thus indebted to the fiat of gov- ernments for an unknown but large part of their value, although not for the whole of it, as govern- ment paper may be." The money value, how- ever, either of gold, silver or paper is equal. Money, well distributed, stinmlatesall productions and brings individual happiness, but if withdrawn or concentrated into a few hands, activity ceases, and individual and general oppression and distress ensues. — Journal. Tuesday, September, 30, 1884. SPEED THE DAY, The recent attempt of the banks to squeeze the Dominion Finance Minister, by demanding specie for Dominion notes, in order to speculate on the New York stock market, will probably hasten the event of the inevitable day when all the paper money required for domestic needs will be issued by the Government, thus removing from bank managers the dangerous temptation to "speculate*' with the gold obtained for their own "promises to pay." It is peculiarly significant that the •udden demand for gold did not come from the people, nor. for the purpose of carrying on legitir 29 mate trade in this country, but solely to gratify the mania, for speculation in the great gambling centre of the neighboring Republic. It is the old story over again. Financial derangement and difficulty begins — not with the people, but as a natural consequence of a defective monetary sys- tem, which gives banks and speculators the power to work mischief whenever they please. Do away with bank notes, and it will then be no longer necessary for -the banks to hold so many millions of Dominion bills as security for their circulation. In this way the Dominion treasury would then be relieved from the danger of a sudden, concentrat- ed demand for gold, like that recently and most unwisely made by the banks.T-75^ Visitor. St. Catharines, June 2, 1884. CORRECT AND INCORRECT. The. ordinary greenbacks were made legal ten- der except for custom duties. They depreciated and appreciated in value just in proportion as the prospects for their redemption seemed good or bad, and at one time were worth less than 40 cents in gold. They were fiat dollars ; they would pay all private debts, but they lost value just as the people lost faith in them as the representa- tives of gold. — Spectator. Our contemporary is quite correct in his itate- ment of facts, but not in his conclusions.. No re- deemable money ever stood at par for any con- siderable length of time ; because it becomes^a promissory note, and its payment depends upon :^ 30 the ability to pay. Plenty of so-called Canadian money went below par for the same reasons. The .greenbacks were redeemable in gold and they fell below par; but the moment the GoTernment issued the fiat that greenbacks were legal tender in payment of all debts — ^lawful money of the United States — they at once rose to par. Money is par, and cannot go belov^ itself. Money is the measure of values as a yard stick is that of cloth. Why not demand a redeemable yard-stick ? Th# people want a legal tender that will pay all debts and taxes. ^ That alone is money. The world doesn't do its business in money any more than it does in leather. It is simply an exchange of com- modities, the money of each country being the measure of value. — Journal. I lecoUect the time when greenbacks went down to twenty-five cents, a friend of mine received $400 for a $100 check. The director of the United States mint has pre- pared from extracts of the reports of the money in circulation in 30 principal countries, a state- ment showing that the gold coin circulation of the world has decreased during the year $52,000,000, silver circulation increased $42,000,000, paper money increased $112,000,000. The decrease in the circulation of gold is accounted for by a di- minished production and increased demand for that metal in the arts and for ornamentation. CURRENCY NOT MONEY, Th% Spectator obdurately holds to the opinion 31 / that a bank note is money. Our friend might as well call a shadow the substance. A /bank bill is simply a promissory note. Says our contempor- ary : By what mental process the Journal gathers that "there is no other power than the govern- ment to create money" it is hard to determine. Does it mean that because the government has the exclusive legislative authority over the issue of paper money, therefore only the government can issue paper money ? If that is the JoumaVs meaning it will soon find itself in a box. That is just what we mean. A bank charter is the creation of parliament. The government is the source of power, not only in all matters per- taining to the issue of paper money, but also in authorizing banks to issue substitutes for money. When the government proclaim bank notes to be a legal tender bank notes will then be money, but not before. It is true that bank notes, in the absence of government notes, answer for currency. What a protest would go up from the people should a >rivate corporation be granted the privilege of managing the post-office and issuing postage stamps ; but such a privilege would be of •' minor importance compared with the issuing of ' the currency of our country, yet this important function is largely controlled by bank corpora- tions. The sovereignty of people over money lies in the act of confederation, and the people should command their representatives to exercise these -sovereign powers, and not to delegate them in the 32 issue and control of currency. Our medium of exchant^e should be all money, and substitutes therefor banished. — Journal. St. Catharines, July 16, 1884. Our banks hold all dominion notes as gold in their vaults, as it is recoj][nized by the government as gold. There is the point of tlie wedge entered for the government — the help to the "beaverbacks"; now, all we want is *^he people to take the maul and drive the wedge home ; now it hinges on this, why not issue a much larger volume of domestic money than what has been issued ; it would he gladly accepted by all. Now, if we have been accepting in the past all kinds of bank bills, which we have been supposing to be good, and expecting to be good for the gold, but which has turned out to be good-for-nothing when presented at a bank at the end of a run that has taken place, and gold has run out of the vaults of the bank where the run has taken place, and thous- ands of promises to pay out did not, because they could not ; they never had enough to pay, on de- mand, the whole of the issue, and not even enough to redeem two-thirds of their issue. — Tor- pedo. THREE TO ONE. The Olohe, as we anticipated, fiercely attacks Sir Leonard Tilley for his statement respecting th9 banks, viz., that two-thirds of these institu- tions would find it difficult if suddenly called on ^ 33 to redeem their notes. For this plain statement of a truth which is known to all who have the least knowledge of financial affairs, the finance minister is assailed and 8tit;matized as an ignoramus. In its attack the Ghhe is supported by Mr. Maclaren, president of the Bank of Otta- wa, who says that he "knows of no bank in Cana- da that is not able to meet not only its circulation, but all its liabilities." If Mr. Maclaren made this statement he exhibited an amount of ignorance deplorable in one holding the responsible position of a bank president. The total liabilities of the banks is over $145,000,000. The available money for payment of this sum is under $20,000,000. Of course the total assets of the banks amount to over $225,000,000 ; but in case of a sudden de- mand it would be found that assets are not money. The bank notes in circulation amount to over $38,000,000, while they hold in specie $7,000,000, and $11,000,000 in Dominion notes. While nominally this specie is "held by the banks" it practically belongs to the Dominion government, and is the basis of the Dominion note issue, and could not be withdrawn from the banks unless the government suspended specie payment and made the Dominion note an absolute money. ' This leaves the banks $11,000,000 of Dominion notes with which to redeem $33,- 000,000 worth of circulation. The secret of making one dollar stand for three is not under- stood by the public, who agree with Sir Leonard Tilley the banks would find it difficult to redeem their pledges if suddenly called on to do so. In- 34 deed, the Glohe gives tlie whole case away when it quotes Mr. Smithers, of the Bank of Montreal, as saying, "that there could be no money made out of a circulation for which there was a dollar for dollar reserve." Now we know banks do make money, and consequently cannot be in the position the Globe claims, so far as their circulation is CO n cer n ed . — Journ al. St. Catharines, February, 16, 1884 The exports from the Dominion for Septemi..^i' reached a total of $8,837,373. The imports for the same mouth were $9,980,131. — Mail. October 15, 1884. A SIGN OF PROSPERITY. A few days ago the annual general meeting of the shareholders of Mols. ii*s Bank was held. The president, in addressing the meeting, said, amonst other things : "Our circulation has lately gone up rapidly, a certain proof of increasing prosperity, and greater activity in business. ' That is in accord with the contentions of the ad- vocates of currency reform in Canada, and it is pleasing for us to hear bankers express their en- dorsation. At the same time we take the liberty of asking — if the doctrine of the bankers is true that only gold and silver are real money — how is it that the bank in question, while only possess- ing $307,193 in specie has a circulation of $1,812,461 ? It is true that it holds $644,713 of .( ■ \» I for 35 Dominion notes, but even then it is circulating its promises to double the amount of the pay in sight The vast business of this country requires a large amount of currency, and when the volume of money is insufficient to meet the demands of business, the people substitute their individual notes or those of corporations. This is the worst form of currency, for it only builds and tillsea powder magazine beneath our business enterpris s, to which the money power applies a fuse, when the debt obligations whicli it holds are called in for payment in lawful money, money that every- body wants, but which only a few can obtain — because there is not enough to go around. It being true tliat even an increase of bank note circulation is a sign of prosperity, would not greater prosperity attend tlie issuance by the gov- ernment of a sufficient volume of legal tender currency to meet the business requirements of the country ? Currency may properly be defined as a medium for the exchange of products and services — an instrument of convenience. Then as busi- ness increases we want more conveniences, and no power should withhold them. The profit of cir- culation should go to ' the people, and not as at present mainly to the banks. The sign of prosperity spoken of by the presi- dent of Molson's Bank mentioned in the above extract is no doubt true enough in the light ; he as president, and a banker looks at it that they had issued a very large amount of paper money, 36 . and had not yet been called upon to redeem with gold, and it remains to be seen which way the cat is going to junip, high or low, and it hinges on tliis whether the bank stands or falls, when this is the question. If they have to redeem all their issue, they, as bankers, have not made as much clear cash out of their paper bills issued as they would have done if only one or even two-thirds had been presented for redemption. The banks on the other side were failing every day, and under our free banking act banks sprung up like mushrooms, and they were about as solid in sub- stance, like children of the mist of shadowy form, only they could not stand in tangible form the business they took in hand when real hard times came, but vanished, leaving an aching void, and Biarved families. And then bad bills flew about the country, and were so much valuless waste paper, and used as such for all sorts of purposes. It was a convenient size to carry in the pocket, for unmertionable purposes, and that was the use the Zimmevman bank bills were put to, and that is the use all other bank bills will be put tswhen they promise to pay and are not redeemed. — To7'- pedo. INTRINSIC VALUE OF MONEY. The theory that money, to have worth, should be possessed of intrinsic value, though still clung to tenaciously by some people, is gradually being eliminated from economic theories. In England ^ to-day the proposition is under discussion to re- duce the amount of gold in the half-sovereign. il t' HI 37 Suppose the coin was entirely eliminated and paper substituted, would not the latter command as much value in Canada ? The money value would be just the same in England, inasmuch as it would, by its le^al tender quality, pay a debt in that country, and coin has no further power. The bullion or commodity value does not regulate the legal tender or money value. It is true that old school theorists may yet claim that a $10 gold piece, by reason of its being gold, is both money and wealth, but a slight analysis of the matter will show that the money function of the coin is derived wholly from its legal tender property con- ferred alone by the law or fiat of the nation issu- ing it. It is only a year or two ago since the Can- adian government made the English sovereign uniform in value by imparting fiat or legal tender to it in British Columbia. What gives the power to our copper cents, 100 of which do not contain 40 cents of exchangeable value created by labor, or what gives a $1 Dominion note value in ex- change to 100 cents, when there is for every dollar issued onlv 15 cents worth of labor created in the shape of gold or silver wherewith to back it, or in other words 85 cents of fiat and 15 cents of labor creation ? Our friend of the Spectator says that although the law regulates the issue of money it does not create its value, and thai the value is in the coin. We are inclined to think that nature and man's efforts in discovering and extracting these metals from the earth has some- thing to do with the issue. Our contemporary will not assert that governments have not the V 38 right to demonetize or remonetize gold or silver. We have seen them do so in the United States, and there are few governments in Europe but at one time have done so. In 1847 Austria and some other European countries demonetized gold and the value of that metal fell enormously iu that country. In Canada under our present sys- tem the banks have full swing in regulating the amount of currency or so-called money. Now, what becomes of "inflation" so miicb spoken of in the past should the government issue paper money ? Surely if the law regulates the issue, as the Spectator contends, it must have something to do with the value, for if, as hard money men hold, that inflation of paper money depreciates its value, contraction must appreciate or increase it. The currency advocates have not held that law should create a value in money, but merely that law creates money, and that money should repre- sent wealth, but not be wealth, merely a commod- ity serving as a medium of exchange, a tool of trade with the power alone of paying debt, and at all times in sufficient volume to be the servant, not the master of commerce. — Journal. Wednesday, July, 23, 1884. Now, if the government will control the issue of bills the private banks can do the sharing and loaning, the non -responsible work, in fact, the dirty work of the banking business, and let all banks have the power to issue gold, silver and copper, as well as the government, but only ou ssue and the it all and only ft 1 fr 45 €ut of other nations, in customs, etc. Now, if by internal industries we produced more than we want of food, manufactures, etc., and if any other nation required it we could sell it to them for some of their products ; then when their products came into our country the duty would be paid us in gold by other nations, and a surplus over our pro- ducts we would thus have in gold ; then our In- land Ke venue tax would be lessened, or taken off altogether when sufficient funds are received from other resources by Government ; then a great burden will be taken off the shoulders of the nation. Now, when any needed improvements take place who pays for it ? out of whom does the money come ? Yqu say, oh ! the Government pays for it. But I know the money comes out of the people ; some would say, oh ! no, the Govern- ment borrows the money from England. True, but if the Government does borrow, who pays the interest, and in twenty or thirty years who pays the principal ? Why, the people, all by taxation^ Now, if you only compel the Government by petition, through your members of Parliament, as they are very loath to do so without your consent, to bring up before the Houses of Parliament n bill of such vital importance to the country as the Currency Bill; it will not injure the private banks, for the nation has lost coniidencQ iu them, and only await an opportunity to invest in Gov- ernment securities on a large scale, that is, in a Government bank, for it easily seen that the con- fidence in the private bank system is gone foreveic* by the very large sum placed in the Post Oifice ^ j„,w«r»«»*» 46 Savings Bank, at a much less interest than private banks offer, and aro payinp; for a time, but for how long ; echo answers how long ; for the people know well enough that the Government is strong, and, of course, stronger than all the private banks put together. Now, the time has arrived that the Government should be compelled by all legal means to step in and save the national credit from ruin. I, and others, know that a hard battle is to be fought before we get it, with the bank in- fluence ; but we will conquer yet. If the present members will not press the matter this session we will send in our own b'eaverback men, who will act independent of them upon that point, and make that a strong plank in their platform at election time, and they must, and will continue to press the matter afterwards at every favorable opportunity. Now, to keep up the blowing up character of this work, I will say, once for all, that you will see that after the structure of the banking system of this country, as it is at present, is. well shaken to its foundation, and burned up, it will end in ashes and smoke, and, out of the chaos and ashes of the defunct bank system will rise triumphant the grand bank of issue and deposit, of jthe Do- minion of Canada, controlled and managed by Government, and worked by Government officer^ like the ancient Phoenix, rising, vigorous and as- serting its right to control the currency, backed by the national credit ; then you may invest any amount of money you may wish in safety, and when other countries see us rich in produce and ^:. V > inks the >gal i i: 47 nianufaptures as we are in mines and niinerals — which only want money to work them to be the means of making the nation, as well as individu- als, rich beyond conception. As treasures lie buried beneath the ridges and hills along the route of the Canada I'acific Eailway, which, as soon as it is once fully in operation for business, work no doubt will be commenced — for business men will not commence until they have the means of rapid transportation, to get a quick return for monies invested. Then the eyes of other nations will be turned to us, and we shall be looked for- ward to by them as a nation worth trading with ; then we shall be in a position to dictate our own. terms to a certain extent. That is only some of the benefits to be derived from a good stable currency, for the certainty of having good bank bills always in your hands is a great comfort, in- stead of Keing afraid of rising in the morning and going to business, to be told first thing on enter- ing your office or shop that a bank, like the bank of Upper Canada, or some of those of recent date, as the Exchange or Federal banks, have burst, and you have just been paid in all that wild-cat and dead- dog money, and that is all the money you have in the world ; so you are ruined, unless you ox your fond wife has laid it out in provisions on Saturday night — before the failure got wind. Mining speculators have purchased thirty thousand acres of Government lands on the north shore of Lake Superior during the past few months, f':^. 48 and are prosecuting a vigorous search for the precious metals. A NARROW ESCAPE. The financial flurry arising out of the shrinkage in the value of hank stocks and the run on the Federal has ahout subsided. At all events quiet has so far been restored that no danger of a gener- al panic need now be felt. In finance nothing so often occurrs as the unexpected ; but so far as the recent commotion is concerned, it was not alto- gether unexpected, and hence the public were in a calmer state of mind than would have been the case had one of our banks suddenly closed its doors without suspicion of its solvency having been entertained. Federal stock was notoriously speculative, and the management of the bank waef not in accord with the ideas of common sense financiers. The whole concern was on the baloox^ principle, and a collapse was bound to come eventually. The escapade teaches a lesson, whicH bankers above all others should profit by, namely, that it is impossible to exaggerate the import- ance of enforcing commercial integrity. The recent management of ^he Federal probably now realize the mischief which so-called sharpness in- flicts. It is a mistake to imagine that such specu- lation should be endured because rashness has fiometimes succeeded in the race against cool and honorable prudence. the 49 In commentinfij on the recent run on the Federal bank the London Free Press says : The public may see in what lias taken place some new reasons why the circulation should be of a charac- ter guaranteed by the government of the country. Had the run on the Federal Bunk been heavier than it was, had the strain been a little more pro- lonjied, the holders of the money issued by the bank in question might have found themselves compelled to submit to a considerable discount, as they have done on former occasions when financial trouble has arisen. Fortunately, so much of the money that is in the hands of the people is in the nature of Dominion currency that but a partial loss can now at any time occur. At the same time another warning has been j^iven that though private banks and corporations may be, and are, very effective as banking institutions, the currency of the country, that which people are obliged to have wherewith to carry on the ordinary business of the day — that, at least, should be without a shadow of suspicion as to its ultimate value. The Canadian Gazette of Aug. 28th, 1884, con- tains the following note : — " Are not our Canadian contimporaries under some misapprehension in regard to this loan ? It seems to be assumed that the loan is placed, be- cause Mr. Aunand tendered for the whole ($4Q0,- 000) at 8 per cent, premium, and had it allotted 50 to him. If Mr. Aniiend has paul for the hoiuls, or is open to do so, then the ^oan is placed with- out doubt, but as we understand the case, Mr. Annand applied for the loan on the supposition that certain insurance offices here would tako the bonds of him, and that they have not done so. The reasons a.^ainst their taking- them are well known, and will have to be settled with before Nova Scotia bonds can run "urr'^nt in this mar- ket. The fact is, that Me^SiS. Barinc^s claim £52,000 of the Nova Scotian Go/ernnient, and until the claim is shown to l.e groundless, or is met, nothing can be done here in regard to a loan." 4 THE EXCHANGE BANK PETITION. Intervention on the Petition. The question of the petition of the Exchange Bank depositors for reducing the number of liquidators from three to one came np to-day in the Practice Court. Mr. Edward Holton, M. P., appeared for the Crathern-Caverhill interest, representing $95,000, and Mr. A. W. Atwater for the Philadelphia and Heading Coal Company, representing $10,000, and together interv.ened in the case- Mr. Holton stated that he opposed the proposed dismissal of the two liquidators, on the groundH that no sufficient reasons had been alleged, that his clients had the fullest confidence in the liquidators, and that before'such change was made. . ^ 'ith- Mr. htion the |e so. well let'ore I m ar- il aim and or is to a . 51 a meeting of the creditors, "depositors and contrib- utari^s ot the bank ought to be summoned, to as- certain tlieir feelings and opinions on the matter. Mr. Atvvater followed, and objected on the same grounds as his learned friend. There is a song I have heard our street Arabs sinii, " Marv had a Little Lamb," the air of which w^ould suit the little song below : — Willie ha be required, length and probable cost ; then the Government shall appoint a provincial land sur- veyor to make a survey as to depth of ditches, and levels, and where culverts and bridges are required, and make his report ac- cordingly. Then the Government can order tht Council to employ men enough to commence and finish it as soon as possible, not letting any unnecessary delay occur between the time of the application of the township or county council, as there will bo always money ready to' ft6 pay when the Government will have plenty in the Government bank always, ready to pay out for work done for it. Then the lands, if owned by Government, can be placed in the market and sold; and the sale of them will more than repay the cost of survey, ditching, etc., for I know of acres of land drained in that way that have been sold for $3, $5, and $10 an acre, about some settled parts of Sarnia, at Lake Wawanosh, and on 4, 5, 6, and 7, concessions of Moore, and some parts of Lambton, once the abode of musk- rats, rattlesnakes, frogs, toads, and millions of mosquitoes. That is a thing of the past, and now it has produced fine crops of corn and potatoes, and very heavy crops of all kinds of cultivated grasses of rank growth, (or the depth of vegetable mould that is brought to light by the drainage system is from the depth of two to three feet of the very richest description, and when plowed up and exposed to the action of the severe frosts of our winters, is just like flour in the spring, it crumbles up as such. Now, I would ask you to give a few moments time with regard to the power the Government has to place it's fiat on anything it chooses, and to convert it into money |and make money out of it, and every person in this, whole Dominion has, and still recognizes this power every day. Who has the power to say these postage stamps shall be worth, one, two, three and five cents, postal card one cent, and the medallion tliree cents, on the envelope and register stamp ? Why, the Gk)vernment, aAd no one has ever disputed the id! Hi 67 right of the Grovernment to do so ; and it has con- verted that piece of paper which was of so small a value before the Government fiat was placed upon it. The Queen's face was impressed upon it — that gave it value; also the same thing was done with regard to bills, notes, etc.; yet no one grumbled. A revenue had to be raised out of the recourses of the Dominion ; it was done by extra- ordinary means, but legal. Now, what is to pre- vent Government from issuing a much larger vol- ume of paper money ; we are in a great strait, commercially speaking, and it only requires a very great effort on the part of the people to crush out and down by all legal means in their power the great influence the banks have Over a certain class of our people. But when all this*was done to raise the revenue out of individuals, the banks did not use any influence against them, although the money was taken out of the people with re- gard to the stamp duty on notes, bills, drafts, and all that class of paper, and you received not a single benefit in return ; but you do in postage stamps, because you get your letters and papers conveyed from one point to another, and taken the greatest care of from the time that you intrust it into the care of the Government until it is placed in the hands of your friend or business correspondent, as the case may be. Now, where the shoe pinches is here. . The banks know that the moment the Government stops the insne they lose the great power they have hitherto wielded over the people and over the members and the Government ; that is the } 6S reason the bankers are raising heaven and earth to stop the bill becoming law. I would say, the banks have shaved us and the Government long enough ; we think it is time to stop that work ; we want to have a chance to make a little ; the banks have ruined enough orphans and widows and old men, and it is time to put a decided stop to it, once for all. The very moment the Gov- ernment stops the power of banks to issue bank notes, and issue all bank notes of Government from that moment, tlie people, and, of course, the Government, begin to make and save money, and then, I think, the Inland Revenue can be taken off, unless it will be kept on as long as the loan, principal and interest is paid — borrowed by the Government to build the Canada Pacific Railway, the great back-bone of the Canadian railway sys* tem. It will pay after a time ; we shall share the world's travel, and it's a thousand miles shorter to Europe and Asia than by the American roads, and of course much less risk, etc. I would say again, my fellow-countrymen, you must make an effort to stop the issue of the private banks, now and forever, or we shall always have these periodical crisises, and private banks breaking djwn every now and again. I am not injuring tlie banks ; they, as a body, have injured their own credit with the country long ago, and the credit of the country too, as it appears that our private bank bills are at a discount, and there is some talk of the United States people refusing them, and accepting our Government bank notes only. Well, it is only what we have done, and ^ I iv ;artli , the long ork ; the dows - stop Gov- bank ment le, the y, and taken J loan, )y the lilway, ly f^ys^ I share miles lerican would b nmke banks, I these •caking njuring 1 their id the lat our here is e fusing k notes ne, and 69 ure still doing every day. I will not accept any Aiaerican bill, except the States Government :^>ill, which is perfectly safe, and is as good as gold, and taken by merchants in preference; in fact, the Government for some time paid their employees in gold and other coin, Which they found incon- venient to carry abo'it, and at last merchants and others petitioned th . Government to pay their employees in greenbacks. That was an admis- sion in favor of paper money ; a money more convenient than to load a man down with metal, making a pack horse of him, and tearing his pockets off, or compelling him to put in chamois leather pockets, or sheet-iron. A long pull, a strong pull, and pull together, and you will get the bill passed, and you never will regret doing so, as you will then have a perfectly safe cur- rency. Why should you be afraid to fight a man you met on the Queen's highway, and who told you to hold up your hands, and you have a very large sum of money in your pockets, would you quietly and tamely let him take it all out, or, a9 the slang term is, let him "go through you,'* while he held a revolver. Perhaps you are say- ing, not if I know it ; and yet you have allowed a banker to rob you and your friends by placing money in his bank, in shares, and on deposit, and taking his promises to pay the notes, and he does not want to see two of them come back for gold; perhaps one may come back, and he has the gold dollar for that ; but if two dollars came back it would be a tight squeeze, and if Oi*e-third of thi issue was to come it would be an unexpected H*<.V 70 pleasure, he would be asked to call again ; the banker would be quite unprepared to receive it, put in three days the doors would be closed to keep out the drafts ; it would be right in a day or so, as they had closed for some repairs quite necessary to the bank ; but come in at the side door. Now, you would not let that man stop you and attempt to rob you, and have not had half the chance to resist it, because he has the law on his side, to rob you. Is not that obtaining money under false pretences ? The banker pretended he had gold to meet the amount, the bill bears the promise to pay the bearer, and he only expects one dollar out of the three, possibly two, but never all three ; that would never do ; there is no money in that, the bankers say. But when the bank bleaks down, that is where all three are made clear; so honor is all gone. Then is the row outside of the bank ; it is a wonder they do not lock the up building and punch the president and directors ; no, they are protected by the law ; you allowed your Government to make it so ; you must grin and bear it, or alter the law. But you have a much better chance and po^^'er over the man who met you on the road, who put the re- volver to your head and said, "Hands up," and tried to steal openly, either at night or in broad daylight. Perhaps you shot at him and killed or wounded liim ; not so with the bankers ; at any rate it was the most manly, open way of the two, only not legal way of robbing you. But he did not deceive you ; he gave you to understand that he wanted your money, and he was going to try and s., 71 take it, if he could ; you had a chance to fight him, if you had courage enough to do so. But the hanks have taken a sneaking way of getting your money ; they tickle you with a straw on the cheek, and put their hands into your pockets, or the next thing to it ; they have deceived you in every way. Emigrants, and friends of emigrants, I would advise you when you come into this country at first, to put all your spare cash into the post-Qffice savings bank ; it will be safe, and draw- ing a little interest — four per cent.; but it is in a safe place until you want it; you will have to give three months' notice of withdrawal; but before you deposit your money the postmaster will give you all the proper and correct information as to what way you must proceed. Then you ha\e plenty of time to look around, now that your money is in a safe place, and you leave it there on interest ; and if you have a very large sum that you do not want at present you can deposit a thousand dollars in your own name, another in you wife's name, and a thousand dollars to each of your children, even if you have twenty-five ; that would give 827,000 at four per cent per annum, which equals one thousand and eighty dollars ($1,080) interest, and that is a very good " nest egg " to fall back on. Of course, before the year is up you have moved on to your little farm, your crops are all in, and you are preparing for our long winter, the interest comes in very handy. As you have only come out in the spring, and if you have taken up a bnsh farm, your fuel costs nothing only your labor of cutting a/id drawing it to you house ; your house is your own, rent free ; your taxes are very small in the country, $4 to $5 per year, and road v/ork a few days. You are now independent ; now you can vote for the mem- ber of Parliament, who will bring up a bill to vote for a :iational bank of issue and deposit, a good currency and safe money — no break down. Now, if the Government was to take the con- trol of the issue of bank bills, with the under- standing that there would be no loss, not even by being worn or torn by use, but, by sending or taking them to the place where tlie person would be appointed to receive them, and it not a forgery, to give a new bill, without any change, and if a forgery, to destroy it at once, as well as all worn out bills. We would then have a clean, decent currency, always fit to handle ; but all bills must be taken to the Government bank, or its branches, while the marks, signatures, &c., are still visible, {? id what date issued, so as to show it to be a good bill of Government issue. With regard to deposits and purchases of Government bonds and other securities, 1 would say, let them be called three per cent, consols, or whatever whatever percentage is thought proper, and to be perman- ent ; and bearing in mind that our Government must offer more than England or the United Stated, and the security offered is as good as theirs, but we can afford to give a little more, as we have a better scoop for it, and larger than England, and just as good as the States. The amounts of all sums received by Government for any sales of 78 bonds and other Government securities whatever, to be used for the permanent improvement of the countrv ; the improvements made : to be made to pay tolls, or fees, not more than sufficient to pay the employees, and to keep the works in thorough repair, &c. Then the country would not have to be taxed to pay the principal, and only those parties who used or are directly benefitted by the works, and could afford to pay for the use of them, all description of national improvements, such as light-houses, light-ships, canals, railways, roads and drainage in new settlements, elevators of grain and very heavy material at all places of shipment, either on sea-board or at the lake ports, or canals, also cranes, windlasses, &c., and to build any Government steam or sailing vessels. FOUR PER CENTS, BY SYDNEY GREY. Let Others tell how foreign bonds Their owners reimburse, And laud them up as fairy wands, Which soon will fill the purse ; Let brokers try to make me pay More heed to thriving Rentes, I listen not, but make my lay In praise of four per cents. Some trust to minr in veins of which The road to wealt .^ms plain ; I'd whisper to tie m ould-be rich. i 74 Too oft 'tis all in vain. A fortune in futurity Their golden dream presents ; Small gain and good security, My modest four per cents. We read cjf startling dividends, Tiiat prove the richest — joke. And many a tlaming scheme that en Is, Most tittingly, in smoke. Projects and plans, which should he trust, Confiding man repents ; No, no ! In cautious mood he must Rely on four par cents. ^1 Ah ! then when breakfast calls him down, The dail}'^ news to cull. If loans are •' weak " he does not frown. Nor quake if shares are " dull " ; And railways may be very " flat," His peace that ne'er prevents. He all the more is merry at The thought of (our per cents. " . / I don't believe — directors may — In making soup from size. Importing chairs from Table Bay, Or something just as wise. We will not say one word about Their good or bad intents. But, if thus far you've heard me out, You'll keep to four per cents, 75 I have converted the^flbove from three per cents, to four per cents, to suit the Dominion of Canada Post-offi9e Savings Bank, but the spirit is the same. The composer of the original lines is a true believer in Government securities, and I could not help copying the lines, as I thought them very well suited to express the ideas of a believer in Government securities. If the person was ill this country he would be a "beaver- backer." — Torpedo. The amount standing to the credit of the de- positors in the postal savings banks of the Do- minion at the end of 1884 showed an increase over the previous year of $1,603,258. The number of depositors in the first half of last year also in^ creased nine per cent., and in the last half four- teen per cent over thoie of 1883. — Mail. January 20, 1885. During Sir John Macdonald's reception and banquet at Toronto, December 17, 1884, not a word was said about a change of currency. Are they going to carry on the same system as form- erly and let the private banks have their own way as before, to rob the country as they like. It seems ftrange that such an important matter should be overlooked ; what is or can be the reason ; perhaps honor to the chief was the all- absorbing topic. I find that I shall have to use my torpedo to make a noise amongst the banks ; 76 then perhaps Sir John and others may ask what is the row ; but the end is not yet ; there is plenty more to Ibllovv the va^^ haby, who is march- ing on to victory, and thon he will be able to say, in the langnage of tho Roman general, the three ^important words, Vedi ! Vidi I Vici ! EHUATA : On Title page read Capt. llueben Wynne ; on page 14, line No. 10, read Journal ; on page 18, line No. 24. read Capt. Rueben Wynne ; on pige l^, line No. 25, road Oapt. Rueben Wynne ; on page 22, line No. 6, read *' although ; ' on page 35, line No. 8, rea I " lills a ;*' on page 35, line No. 9, read "enterprises;" on page 38, line No. 27, read "shaving;" on page 39, line No. 9, read " producing ;" on page 41, line No. 4, from bottom, read " issuing of notes ; on page 44, line No. 2, read " 10 per cent." instead of " two per cent ;" on page 54, line No. 1, from bottom, read " but that you cannot do ;" on page 58, line No 6, read "secured ;" on page 63, line No. 6, from bottom, read " that the i'>. tegrity." Where " National Policy " occurs, read " Nation- al Currency." On page 65, line No. 19, read " but there ;" on page 65, line No, 24, read "Government can." . ! V . . ' s -r -> 111!