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386 must be something formidable in it, some real and present danger threatening a very positive evil, and not a mere sympathetic and groundless alarm.

Neither do we conceive it as sufficiently expressing or explaining the whole facts of the case, to say that the currency has been deranged. There has been unquestionably a great derangement of the currency; but this may have been an effect rather than a cause of the more general disturbance; or, again, it may have been only one cause out of many causes. In an article in the first number of this magazine, the financial fluctuations in this country are ascribed to the alternate inflation and collapse of our factitious paper-money. Adopting the prevalent theory, that the universal use of specie in the regulation of the international trade of the world determines for each nation the amount of its metallic treasure, it was there argued that any redundant local circulation of paper must raise the level of local prices above the legitimate specie level, and so induce an excess of imports over exports; which imports can be paid for only in specie, — the very basis of the inordinate local circulation. Of course, then, there is a rapid contraction in the issue of notes, and an inevitable and wide-spread rupture of the usual relations of trade. But although this view is true in principle, and particularly true in its application to the United States, where trade floats almost exclusively upon a paper ocean, it is yet an elementary and local view;—local, as not comprising the state of facts in England and France and elementary, inasmuch as it omits all reference to the possibility of a great fluctuation of prices being produced by other means than an excess or deficiency of money. In France, as we know, the currency is almost entirely metallic, while in England it is metallic so far as the lesser exchanges of commerce are concerned; there is an obvious impropriety, therefore, in extending to the financial difficulties of those nations a theory founded upon a peculiarity in the position of our own.

If, however, it be alleged that the disturbances there are only a reaction from the disturbances here, we must say that that point is not clear, and Brother Jonathan may be exaggerating his commercial importance. The ties of all the maritime nations are growing more and more intimate every year, and the trouble of one is getting to be more and more the trouble of the others in consequence; but as yet any unsettled balance of American trade, compared with the whole trade of those nations, is but as the drop in the bucket. John Bull, with a productive industry of five thousand millions of dollars a year, and Johnny Crapaud, with an industry only less, are not both to be thrown flat on their backs by the failure of a few millions of money remittances from Jonathan. The houses immediately engaged in the American trade will suffer, and others again immediately dependent upon them; but the disturbing shock, as it spreads through the widening circle of the national trade, will very soon be dissipated and lost in its immensity. That is, it will be lost, if trade there is itself sound, and not tottering under the same or similar conditions of weakness which produced the original default in this country; in which event, we submit, our troubles are to be considered as the mere accidental occasion of the more general downfall,—while the real cause is to be sought in the internal state of the foreign nations. Accordingly, let any one read the late exposures of the methods in which business is transacted among the Glasgow banks, the London discount-houses, and the speculators of the French Bourse, and he will see at a glance that we Americans have no right to assume and ought not to be charged with the entire responsibility of this stupendous syncope. Our bankruptcy has aggravated, as our restoration will relieve the general effects; but the vicious currency