FINANCES OF THE UNITED STATES. 



311 



The Confederate Congress enacted some of 

 the recommendations of the banks, particularly 

 that one requiring all of the interest on South- 

 ern securities to be made payable in the South- 

 ern Suites. The nature of these provisions is 

 best illustrated by an example. 



A prominent private banking house in New 

 York, doing a large business as agent of foreign 

 capitalists, on application to draw the interest 

 on some Virginia inscriptions, owned abroad, 

 were refused payment direct by the State 

 authorities, with an announcement that the 

 payment could only be made through some 

 house in the Confederate States. Having some 

 coupons belonging to the same foreign parties, 

 which they proposed to collect through a cor- 

 respondent in Richmond, they were furnished 

 with the following list of interrogatories, as 

 necessary to be answered before any collection 

 could be made : 



Interrogatories to be propounded to , who is claim- 

 ing to draw interest on the certificates of State debt. 



Are you the bona fide owner of the bond on which 



terest is now due, or from which, this coupon was 



.ken? 



Were you such owner before the 26th day of June, 

 881? 



If not the owner of the bond, are you the bona fide 



rnerofthe coupon? 



If you are, were you such owner before the end of 



th of June, 1S61? 



If the owner of the bond or of the coupon, of what 

 itte or nation are you a citizen ? 



If not the owner of the bond or of the coupon, in 

 what right do you claim the interest? 



Give the name of the person or persons from whom 

 you received the coupon, his residence, and business. 



If you are the owner of bond and coupon, or of the 

 coupon only, are you such by transfer, verbal or 

 written? 



If written, produce the written transfer. 



If not a citizen of Virginia, are you a citizen of 

 either of the States of the Confederate States of 

 America? 



If not a citizen of the Confederate States, or either 

 of them, are you a citizen of the United States as it now 

 exists, or of "any State adhering to the United States ? 



If claiming to collect for another, of what State or 

 nation is that other person a citizen? 



And now give a full, just, true, and perfect account 

 and discovery of the right, title, and interest you have, 

 and of the right, title, and interest held by the person 

 or persons under whom you claim, and in like manner 

 state whether such person or persons has or have any 

 right, title, or interest therein in possession, reversion, 

 or remainder, or whether the same is held by you or 

 them in any manner to evade or circumvent the or- 

 dinance passed on the 26th day of June, 1361, in re- 

 lation to the interest of the State bonds. 



I do hereby solemnly swear (or affirm, as the case 

 may be) that I have truly answered all the questions 

 propounded to me in th'e preceding interrogatories. 

 So help me God. 



Sworn to before me this day of , 1861. 



These are in some respects similar to the re- 

 strictions imposed by the Union Treasury De- 

 partment on the coupons of the State of Texas, 

 but which were not enforced, because opposed 

 to public opinion. 



The difficulty of obtaining means was, how- 

 ever, very great on the part of the Confederate 

 Congress, and a scheme of loans in kind was 

 projected, called the cotton and produce loan. 



An issue of treasury bonds was authorized 

 to be made in exchange for the proceeds of the 

 sales of crops and other industry, and these are 

 to draw interest at the rate of eight per cent, 

 per annum. 



The Government proposed to every planter 

 and farmer to receive from him a subscription 

 in advance of his crop of any portion thereof 

 exceeding one hundred dollars in value, and to 

 pay him in Confederate bonds when the crop 

 should be gathered and sold. The illustration is 

 simple : If there be subscribed 1,000 bushels 

 wheat, 1,000 bushels corn, 1,000 bales of cot- 

 ton, &c., or less, and the place of delivery spe- 

 cified, the proceeds when sold are received in 

 Confederate 8 per cent, bonds. 



The form of subscription is as follows : 



Form of Subscription. 



"We, the subscribers, agree to contribute to the de- 

 fence of the Confederate States the portion of our 

 crops set down to our respective names; the same to 

 be placed in warehouse or in our factor's hands, and 



sold on or before the first day of next ; and the 



net proceeds of sale we direct to be paid over to the 

 Treasurer of the Confederate States, for bonds for the 

 same amount, bearing eight per cent, interest. _ 



X. B. The agent in charge of this subscription will 

 fill the blank as to date of sale, with the month best 

 suited to the locality of the subscriber, in all cases se- 

 lecting the earliest practicable date. 



[Here follow name, post-office, and State, quantity 

 subscribed, place of delivery, and name of factor or 

 warehouse.] 



The issues of paper by the Confederate Con- 

 gress were received and paid out everywhere 

 by the banks and people. As, however, gold 

 was hoarded, and paper money was issued by 

 States, towns, and cities in profusion, while 

 there was little or no sale for the produce, all 

 being blockaded, the paper frightfully depreci- 

 ated. In August gold and silver were already 

 10 to 15 per cent, premium for current bills, and 

 at New Orleans trade nearly came to a stand 

 for want of change, until a state of barter 

 threatened, and all dealers were forced to issue 

 checks receivable in trade, as was the case 

 in New York during the suspension of 1837. 

 Towards the close of the year the depreciation 

 of the paper reached nearly 50 cents on the 

 dollar, and neither the taxes, the cotton loan, 

 nor the investments of Northern debts sufficed 

 to stay the downward tendency. Nothing but 

 raising the blockade, and permitting the real- 

 ization of the vast wealth of the section in 

 produce could restore the finances. 



Failures. The political events of the year 

 could not but produce the most disastrous in- 

 fluences upon the outstanding credits which rep- 

 resent the commercial business of the country. 

 But this influence was modified by two leading 

 circumstances. One was that the panic of 1857 

 had weeded out, so to speak, the weakest of the 

 houses, while in November, 1860, when affairs 

 became threatening, the fall trade was passed, 

 stocks of goods on hand were light, and there 

 was little effort to prepare for a large spring 

 business. Hence the payments due in the spring 

 were, to a considerable extent, realized before 





