applies to a well-regulated system of bank issues based upon specie. When the quantity of notes out is in excess of the requirements of business, they will flow back to the banks for redemption. When the quantity of bank notes is insufficient for the wants of trade, the banks will find it profitable to increase their issues, and thus the gap will be filled. Local and temporary disturbances, occasional panics or speculative periods, which under no money system can be entirely prevented, may sometimes interfere with this self-adjusting machinery, but on the whole the rule holds good. The Government has nothing to do with it but to see that the coin struck in its mints be of the prescribed standard value; it prevents and punishes counterfeiting; it regulates the banking system, so as to make it safe, and then it lets currency and trade in their relations take care of themselves, without assuming any arbitrary control over volume and value. These are the simple principles of a sound money system under which business can regain confidence in itself and prosperity will revive. That is the end which we should accomplish and which is now within our reach.
The paper-money men have contrived to befog the public mind with certain superstitious impressions to the prejudice of the cause I advocate. Let us look some of them in the face. One is a sort of dark terror with which the word contraction has been invested. It would almost seem as if contraction were some diabolical power, bringing forth all the ills human flesh is heir to. Thus, we are told that contraction, with all its concomitant evils, was one of the infernal effects of the resumption act. It is true that under the resumption act, since 1875, the currency has been contracted. But it is also true that this contraction has not had the least depressing effect upon the business of the country, and I can easily prove it. If contraction had cramped business, that is to say, if
