State or Federal Bank Examiner: the stockholders would be quickly brought to their senses; and the delusion that they could meet their never-ending obligations by the endorsement of fresh paper would be dispelled. If a business house attempted this type of finance it would be called “kiting” or worse. If a Bank did it, it would be called “pyramiding” or worse; but if a government does it it is known, for the moment, as brilliant financing. As matters now stand, however, regrets and recriminations are useless. It was a great emergency and we rose to it. The emergency has passed; but the consequences of our rising to it in this way are only beginning to loom upon our consciousness. The United States citizen has endorsed a large number of gold notes, and the holders of these notes, the owners of Government bonds, are, quite properly, going to look to the endorser. This is bad enough; and we should be getting ready to face our distressing obligations in good faith, if an entirely unlooked-for factor were not being regarded as germane to the bargain. A new gospel is now being preached which has in it a growing note of sanctimonious urgency. A large voluntary choir chants regularly at matins and evensong, “Deflate and ye shall be saved!” The personnel of this choir demands a little scrutiny, particularly that of its intelligent members. Is there any connection between them and the larger holders of our combined promise to pay 23 billion gold dollars, and are they quite unconscious that title to an ounce of gold under “deflation” may be worth twice as much as the original goods and “credit” which they tendered in exchange for our promise to ultimately pay gold, and, in the interval, to pay interest in gold? We should not insult them by thinking that they are entirely unconscious of this happy prospect; and we can concede that the gospel of thrift and work which they preach is the best gospel in the world—if those who work are justly paid, and those who save are fully protected. Their zeal for these virtues of work and thrift may have carried them away till, unconsciously, they are a little in the position of the single-minded Lady of the Manor, who, in olden days, preached thrift to the cottager, while her husband’s agent raised the rent.
