Panic of 1873

Excerpt from Money, Trade and Industry: The present work differs from the treatise on Money published in 1878, of which it is, in a certain sense, an abridgment, in two respects. In the publication of 1878, comprising of a lecture delivered in a university, it was sought to trace the history of doctrines, and copious extract were given with a view to introduce the student to the literature of the subject. The present work consisting of lectures delivered before a popular audience in the Lowell Institute of Boston, does not profess to deal with the literature of the Money Question; and I have been content to reach correct results without undertaking; in all or most cases; to balance conflicting views against each other, and set out the arguements on either side according to the methods of the classroom. There is a second respect in which the present work differs from its predecessor. In my Baltimore lectures I held strictly to the topic of Money, denying myself any excursion into general economics, and stopping short always on the line which bounded my immediate subject. In the Boston lectures the title of the course was enlarged to take in the relations of Money to Trade and Industry. Under this extension of plan, the present work deals with many questions which lay beyond the scope of the former. I have seen no reason to modify at any essential point the views of the nature and uses of money which were set forth in that work, and I have not thought it necessary to alter modes of expression merely to avoid the appearance of identity between corresponding portion of the two books. Not only the general progress of opinion, but the course of public events during the past two years, will serve to explain the greater emphasis which is here laid upon the question of Bimetallism, and the introduction of the political aspects of the subject, from which in the former publication, I deemed myself precluded. In dealing with the question of Inconvertible Paper Money, it has been sought to trace out the ground upon which economists may take and maintain a stand against Government issues. Doubtless it will appear to many that too much ground has been surrendered to the advocates of fiat-money; but I am satisfied that no more can be held by the friends of "honest money," who are bound also to be the friends of honest argument. The claim that "greenbacks" are not money in the fullest sense of that term; that they cannot do all in the way of measuring values, so called, which gold or silver may do, is untenable, and it can be of no advantage to any really sound cause to seek to maintain it. New Haven, April 15, 1879.