Currency fallacies refuted, and paper money ... - University Library

;16 CURRENCY FALLACIES REFUTED.they had need to issue any paper of their ownbut the probability is,that most of them wouldhave government notes in hand at all times sufficientto constitute an abundant source of supplyforany discounts or loans they might haveoccasion to grant.trade would be stimulated ;Thus prices would advanceprosperity wouldbe felt throughout the country as in 1824 ;butno convulsion or ruin would follow as in 1825.A difference of value might arise between paperand gold money, but this would createno disorder.Government bills being a legal tender,in them or in Bank notes almost all the paymentsof the country would be made ; whileforeigners would be compelled to pay that pricein our currency for gold, if they were determinedto have it, which it was really worth incomparison with other articles of traffic.But if it be a fallacy to say that the facility ofcreating unreal wealth, by means of an issue ofpaper money convertible into gold at the marketprice, must be followed by convulsion and ruinit is no less a fallacy to affirm, as is done byimplication, that an adherence to the presentsystem of convertibility at the mint price canpreserve us from it. People must either venturetheir capital or starve :they will prefer theformer as the less evil, and in spite of experience,will again suffer from disappointed expectationsfor as soon as they begin to hope all danger ispast, it will rush in upon them like a flood.