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an aggregate of $192,000,000 paid daily in commercial transactions. This would imply that nearly 18 per cent of the total of $750,000,000 of paper currency was paid out each day, thus using the whole volume of currency in every week, but leaving an average of say 78 per cent of it resting temporarily in the national treasury, in the banks, and in the pockets of the people. .

Upon the presumption that the New York bank clearings, exclusive of the stock exchange business, represent nearly 20 per cent of the total volume of payments in commercial transactions in the United States, we may estimate the increase of traffic in the United States by the increase of bank clearings in that city, and in Europe by the increase of the London clearings (given in dollars), as shown in the following table, viz.:

Year ending Sept. 30.













1866. 1867.






1873. 1874.


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4,756,664,386 314,238,910
6,448,005,956 363,984,682
7,231,143,056 380,693,438




6,871,443,591 14,867,597,848




26,032,384,341 1,035,765,107
28,717,146,914 1,066,135,106
28,675,159,472 1,144,963,451

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28,484,288,636 1,125,455,236 $15,278,055,000

37,407,028,986 1,120,318,307
27,804,539,405 1,036,484,821
29,300,986,682 1,209,721,029
32,636,997,403 1,428,582,707
33,972,773,942 1,152,372,108


17,670,195,000 18,603,116,500 20,092,315,000 26,748,610,000 30,016,675,000 29,970,000,000

These figures for the New York clearings include the stock exchange business, which in 1874 comprised about 40 per cent of the whole. But even deducting this, the increase since 1854 is about 150 per cent. The London clearings are, I believe, given exclusive of the stock exchange business, and these show an increase of nearly 100 per cent in the six years. From these facts, together with the vast increase of railroads, which have stimulated internal traffic in all countries to a much greater extent than is shown in their export or import trades, it seems reasonable to conclude that the total volume of traffic nearly quadrupled in the twenty-five years from 1850 to 1875.* Further evidence in support of this estimate of the increase of traffic is to be found in the value of the tonnage and in the gross earnings of the railroads as compared with twenty-five years ago. These items for the United States are given in Poor's Railroad Manual as follows:

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*Much has been said of the diminished use for either paper currency or coin by reason of the economizing expedient of the clearing house system. The extent of this I estimate as follows, viz.: The total daily bank clearings in Europe and North America do not exceed $300,000,000; deducting say 3% per cent for "balances" paid in money, it would leave the total economy of paper money and coin say $290,000,000. This is the total extent of the economy for one year as well as one day.


Gold and Silver. The upper double line is intended to show the probable aggregate of gold and silver used as money in Europe and North America, the presumption being that nearly the whole increase was of gold, the continuous movement of silver to Asia having prevented any considerable increase of that kind of money in Europe or North America, the effects of the increase in the production of silver from 1863 to 1874 having been neutralized in this respect by the demonetization of silver in Germany.

Stock of Gold as Money. The line of dashes (— —-) is intended to represent the stock of gold used as money in Europe and North America, it being assumed that about 80 per cent of the average annual increase of gold in the world from 1848 to 1870 was added to the stock in these countries.

Volume of Paper Money. The great fluctuations in the dotted line, representing the volume of paper money, are explained by the following facts: First, an increase in Austria from 1854 to 1858 of about $100,000,000. Second, an increase in the United States from 1862 to 1866 of nearly $1,600,000,000, about $1,000,000,000 of this being composed of the 7-30 and compound interest notes and the various issues of certificates of indebtedness issued by the treasury, which, though not of the same class of paper as the other treasury notes and bank notes, did circulate to a very large extent as money. The great bulk of this had, however, been retired by 1869, leaving the stock of paper money in the United States about $600,000,000 greater than in 1861. Third, an increase of nearly $400,000,000 in France from 1869

to 1873. Fourth, an increase in Italy of $300,000,000 from 1861 to 1876. Fifth, an increase of probably $200,000,000 in Russia in the last ten years. Besides these greatest additions, there was an increase of about $120,000,000 in Germany, and about $45,000,000 in Great Britain, in the whole period, and an increase in Switzerland of $11,000,000 to $12,000,000 from 1870 to 1873; $12,000,000 in Belgium from 1872 to 1873, etc.

Annual Interest. This line has been drawn with reference to such events as the civil war in the United States and the Franco-Prussian war, concurrent with the increase of railroad and municipal debts.

The courses of the lines in the diagram show the following changes in the percentage of money to debts, or promises to pay money, comparing 1845 with 1875, viz. :

Percentage of gold and silver to paper money..
Percentage of gold to paper money..

Percentage of aggregate of gold and silver to annual


Percentage of gold to annual interest


Percentage of gold and silver to all obligations to
interest and redeem paper money.
Percentage of gold to all obligations to pay interest and

redeem paper money..

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