John Bondfield to the American Commissioners
ALS: American Philosophical Society; copy: National Archives
<Bordeaux, January 9, 1779: Yesterday the convoy for the
French islands sailed, accompanied by three small cutters for
the United States. From a vessel arriving out of Edenton I
have learned that tobacco is £10 per hundred weight in American
currency. American prices are extraordinarily high because
of the excessive emission of paper money. The motives
which produced the excess are no longer present, there being
ample supply for all emergencies.
A reduction in the quantity of money in circulation is essential
to the preservation of credit. A dangerous situation is developing
whereby America’s indebtedness abroad will become
impossible to repay without exorbitant taxation. The amount
of circulating currency in the U.S. has recently been put at
about seven hundred million livres, and given the prices at 20
for 1, it is probable that the sum of 35 millions [in specie] does
exist. The difficulty is to sink the excess ths in circulation.
In the present course of things foreigners become creditors
of consequence, and in time their respective governments
may form a national debt of it, demanding reimbursement that
we would find difficult to achieve. Considerable purchases of
continental paper have been made by men of distinction in this
country, and it is from these circumstances that I warn of the
danger. If capital of two millions could be granted and appropriated
to the end of sinking the continental paper rather than
paying the interest to foreigners, I dare say it would sink thirty
million of paper. Over a few years this would change the face
of the country.
Certain operations now underway may, if successful, put
America many millions in debt to France. If continued this will
create a debt America will find it difficult to cancel.
Two injured young men, former captives, arrived today; I
will try to procure them passage to America. The initial payment,
24,000 l.t., for the cannon you ordered will fall due in
February. Reports from Nantes indicate that the Governor Livingston
and the Chasseur are almost loaded; please advise me
about the status of the convoy.>
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