world. Moreover, its very preeminence
of function--the universality and the durability of its worth--renders it
peculiarly sensitive to accidental influences, or to influences outside
of the usual workings of trade. A great war or revolution occurring
anywhere, the loss by tempests or frosts of an important staple, such
as wheat or cotton, the fall and reaction consequent upon some great
speculative excitement, are all likely to produce enormous drains or
sequestrations of this valuable material. When the revolt of 1848 broke
out in Italy, every particle of specie disappeared as effectually as if
it had been thrown into the Adriatic or the mouth of Vesuvius; when
the corn crop failed in England in 1846, the Bank of England lost ten
millions of dollars in gold in less than nine days, and the country five
times that in about a month; and in our own late experiences, with three
hundred millions of gold among the people, we have seen it so put away,
that no charm or bait could allure it from its hiding-places.

Need we go any farther, then, than these simple truths, to lay our
finger on the primal fact which underlies all financial embarrassments
and panics? The mass of the transactions in commerce rests upon credit;
the solvent of that credit is gold; and gold has not only a sliding
scale of value, but is apt to disappear when most wanted. While business
is moving on in the ordinary way, it is more than ample for every
purpose; but the moment any event arises, such as a rapidly falling
market, inducing hurried sales, or a drain of specie, disturbing the
general confidence, everybody gets apprehensive, everybody calls upon
everybody for payment, and everybody puts everybody off,--till a feeling
of _sauve qui peut_ becomes universal.

If there were no currency anywhere but a metallic currency, this
liability to sudden revulsions would still hang over trade, provided
credit and paper tokens of credit continued to be the media of
exchanges; and the instinctive or experimental perception of this truth,
combined with other motives, is what has led men to their various
attempts to provide a money substitute for gold and silver. Lycurgus, in
Sparta, found it, as he supposed, in stamped leather; but modern wisdom
has preferred paper. The degree of success attained by Lycurgus we do
not know; but of the success of the moderns we do know, by some one
hundred and fifty years of recurring disaster. There are some steeds
that cannot be