.Mjk4.NDE2

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[1]
by City of Washn.)            Liverpool 14 Janry 1862
Dear Ann                              (Tuesday Night)
                My dream as laid before you in my
letter of yesterday is at an end; for we
have today the sad reality that U.S.
Government is bankrupt & therefore that
the Banks in the No. States have suspended
specie payment. – This, however, is a very
different species of such [struckthrough] suspension from ˄those on
any previous occasions within my personal
experience.  All of those (such as in ’37,
’39 & ’57) were the natural tho’ not the
necessary results of over-trading [underscored] but in
this case there has been no over-trading
whatever, but quite the reverse; & we have
likewise the undoubted fact that there
never was a time when the Northern States
were so full of specie. – Then what is
the cause of this disgraceful result?
   I say simply this :     that the Members
of Congress are either knaves or fools; for
they have forborne to impose such Taxes
on Property as were needful for the se=
=curity of the fundholder.

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It is not that the people will not pay
such Taxes, but that their representatives
are wanting either in the sense [struckthrough] intelligence
or integrity to impose them. – They vote
men & money, without stint, for carrying on
the War; but they fail to provide the ne=
=cessary means for obtaining the money!
     It is sad to see the North throw away
that grand & incalculable advantage that
they have heretofore held over the South,
in maintaining public & private Credit:
—for it has not arisen from necessity,
but from sheer ignorance & folly, to say
the least of it. It is downright disgrace=
=ful and abominable.
     Taxes may be imposed now, perhaps;
but it will be to no purpose, in so far
as attaining a return to specie payments.
     That time will never come until the War
is ended.  All that an increase of Taxation
could now accomplish would be to retard [underscored]
the progress [underscored] of depreciation [underscored] in the paper
issued from the Treasury at Washington,
for the War & other expenses of the general
Government, which paper will of course
become ‘ere long the universal circula-

[3]
=tory medium. – and the extent of its
depreciation will of course be governed by
the duration of the War.
     North & South are now in the same per-
-dicament as to “shin-plasters”? instead
of currency equivalent to specie.  They
are both on the high road to ruin!  If
common sense & proper feeling had fair
play, both parties would see the folly
of persisting in the contest.  But as it
                              still
is, I suppose there is ˄ too much pride
in both, for either to hold out the “olive
branch”? to the other.  And whilst I thought
the amicable settlement of the Trent
difficulty well calculated to induce the
South to submit to a return to the Union,
I have now abandoned all hope of this,
because this prostration of Northern cred
=it will of course infuse fresh carnage
at the South, &, as I think, induce
them to persist in refusing any
terms of accommodation, short of
entire Independence, & complete Separation.
At the same time I adhere to the opin-
=ion that such separation would not
exist for many years, provided we

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could have an early Peace.
     If the War runs on until past the time
for planting out the next Cotton crop,
the South must find other employment
than agriculture for at least one half of
the negroes now engaged in that pursuit.
The other half must be taught in many
varieties of handicraft & manufacture.
     The entire face of society at the South
will be steadily revolutionised by this
dogged determination to carve out their
independence.  And I think that one of
the results would be the final emanci-
-pation of the slaves by the South itself,
tho’ it might not happen very soon.
     But to return to the subject of suspen-
=sion of Specie payments. – My first
thought on hearing of this news to-day
was of you & your investments in Bank
of Commerce & other Stocks.  None of
these Stocks are now a safe invest=
=ment.  The only safety is in Gold or
Real Estate, or Commodities; for the
dividends of all Stocks will be made in
shin-plasters, which measured by
Gold, Commodities or Real Estate will

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of course be undergoing constant depre
=ciation, until the War ceases.  If your
income from Stocks, continue of the same
amount in currency that it was before
this suspension, it will not enable you
to buy as much out of it  Nothing can
prevent this except a degree of Taxation
coextension with the expenses of the
Govt, those for the War included.  And it
was absurd to expect any such extent
of Taxation.
     According to my view, it would be better
for you to have all your Stocks sold at
one & remitted hither in Gold or A/1 bills
of Exchange, even if the money here be
perfectly dead & barren of Interest,
than that you should hold Stocks.
     The Banks in N. York have lent their
entire capital to the Govt., & the security
may be safe enough ultimately, safer I
presume than any other they could find.
But they will find it very difficult to
employ their deposits in a safe way.
The men who go into debt at a time when
the currency is depreciating are but too
generally found insolvent when the

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final day of reckoning comes round with
the return to specie-payments; and the
longer the interval of suspension, the
greater the depreciation of the currency
                  the
& therefore ˄ more wide-spread & sweeping
the ruin when the fiat goes forth to
prepare for resumption.
     Thus I should at any rate prefer
holding my money invested in U.S.
Stocks than in Bank Stock.  And I
should also consider some of the first
class Railways safer than first class
Bank Stocks. – New York State Stocks
may be better than U.S. Stocks.
     Suppose the War to last another year,
I should consider the loss of 12 months'
interest would be much less than that
arising from allowing your money to
remain invested in any Stocks, whether
U.S. or States, or Banks or Railways, for
I presume the premium in Gold
measured by Currency would within
much less than 12 mos. time reach 5, 6
7 or even 8%. – It is not Stocks
that rise in the same ratio that
Currency depreciates, but Commodi=
=ties, Lands, Houses &c. – On the

[7]
contrary, Stocks that yield a fixed rate
of Interest, (seeing that such Interest is
always payable in currency) are apt to
rise [struckthrough] sink in price (i.e. in currency-
-price) whilst the currency is in process of
depreciation. –
     I should not expect the currency in
the Northern States to depreciate as
rapidly as it has down in the South: -
but still it is very significant when
we are told that in Richmond the
Confederate money, measured by Gold,
is at 40 percent [underscored] discount!  I suppose it
is much more depreciated at Richmond
however, which is the fountain head or
great center of issues, than it is at
N. Orleans, which is so distant, & where
there is so much more specie (other-
=wise than in Bank vaults) among
the community.
     I think this Bank suspension is
calculated to breed discontent in the
ranks of the U.S. Army, & to increase
the desire for Peace among civilians
at the North.  It may stimulate
trade for a while, but when pay day
comes round, the punishment will

[8]
be very heavy. –
     Perhaps I might as well have spared
you all the forgoing dissertation, as
you have Matthew at hand as your ad-
=visor.  But it seemed as well that you
should hear my views also.
     You have said more than once, I think,
that you thought the Country would never
get to rights again until it had under
-gone deep "humiliation." [underscored] – It certainly
is rapidly sinking into that condition.
But I fear the bitter cup is not yet
drained to the dregs.
     I have written this since the conclusion
of the T [underscored] fight next door.
   Mr. J. Wakefield Cropper was remarking
to me today how much pleased they
all are with Mr. Weed, both with his
steady, orderly, & willing & industrious
course in the counting house, and with
his deportment in [serial?]  intercourse.
I think that if we had searched all
Lpool, he could not have found a more
desirable position in any counting house.
    I may as well now retire to my bed.
                             Yours affectionately
                                         R Maury


[7]

              Washington)
P.S. 15 January 1862     (Office)   (by City of Manch
   Dear Ann – I have this morning yours of 29/30th Decr. enclosing
a note for Mary Bold, which I will hand to her when I go home to dress
for dining at Greenbank. – You do not name the suspension of specie
payt., which, by Matthews circular of 31st, occurred on the 30th: though I sup-
-pose from your remarks on the 29th, as to selling B. of Commerce Stock
& the keeping of your & our money in England, you then anticipated this
event. – No doubt the Trent difficulty helped to bring it about.
     The two circumstances for you to consider, before selling out Stocks
to transfer you money to England, are:  1st the probable duration
of the War, & 2nd the chances for such wholesale Taxation being
imposed by Congress, as would uphold the value of Treasury
demand notes, or prevent serious depreciation.
     This step greatly impairs the strength of the Northern States,
& thus gives encouragement to the South.  It therefore serves
to prolong the War unless “the North are to propose Peace &
the South to dictate the terms.”?! (as Dr. Stewart & so many
others at the South have alleged will be the final result.)  And it
likewise increases, or will increase, very seriously the daily cost
of the War; - whereas if there had been a timely imposition
of Taxes by Congress, of a wholesale character, it must have
shortened the War, & prevented this now unavoidable increase
                                      It also drives

    Capital away from the U.S.,
of daily expenditure     whereas proper Taxation &

    maintenance of specie payt


would of course have attracted capital
     Matthews circular of 31 Decr in reference to this
suspension
is very good; but he does not seem to me to estimate its
consequences as seriously as he ought to do. – He looks at it
as intrinsically of less [underscored] importance than the suspensions of ’37, ‘39
& ’57, because it does not arise from commercial  [underscored] causes.  But
I maintain just the opposite ["just...opposite" underscored].- On the former occasions the
Banks suspended, in order to contract, or diminish their oblija
-tions; but now they do so in order to allow the Government
to expand.  The public always shape their course as the
Banks do, contracting when Banks contract, & vice versa.
     The public will now expand their oblijations, & the Banks

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[missing] as will let Matthew read this letter, as it is rather fitted for him than for you.

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from Europe

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will do so too.  People will proceed – i.e. the mass of traders
&c. – us, tho’ the War will be endless.  And the price of Gold
& Shiling bills will be the only guage of the depreciation.  The
dashing men, without means, will borrow all they can, & they will
make money & entice more prudent men to follow their lead.
     This is not mere theory, it is merely an abstract from the

[Vertical Writing in the Middle of Page 8]

Miss Maury

     I have, as requested, read all
these, I do not agree with
Rutson – The occurrences since
suspension are not at all in
conformity with his assumptions
of what they would be
                                        M Maury

31st Janry

Laura shewed me this morning three
buck-horn studs, representing 2 stags &
a faun for Walker’s shirt bosoms, they do
not make studs of horn [underscored] for wristbands.  The
studs for wristbands [underscored] are of Gold [underscored].-


[Continued horizontal writing on Page 8]

History of England during the financial career of Mr. Pitt
& Lord Liverpool.
     On this day week, when Cotton was so brisk, I was thinking
that my departure might be much nearer at hand than
I had been imagining.  But now it seems very distant.
I would prefer being in N. York very much to remaining
here, despite, of all the kindness, consideration, & affection I
daily receive from the Bolds & others; but it seems to me
that this suspension of specie payt will tend to prolong my
stay on this side, where I can probably he of ˄much more use than
in N. York.                  yours affectionately  Rutson Maury