Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1872-12-18
TREASURY MATTERS.
Secretary Boutwell, and Jay Cooke Be
fore the Committee Of Ways and
Means In Reference TO
Future Finances.
Secretary BOutwelPs Reply 10 Congress
as to His Authority for Increas-
ing the Issue Of Le-
gal-Tenders.


tary Boutwell, and Jay Cooke We're be-
fore the Committee of Ways and Means
this morning in reference to funding
loans. BOutwelps explanation Of the
hundred million negotiation Of last year
was full and complete. He showed that
the alleged loss of interests growing out
of the necessity of giving ninety days
notice to holders of called bonds was
practically unavoidable under any plan
/ that could be adopted, since even with
/ money on hand to meet the call il must
/ first be realized from the sale Of the
bonds, which would bear interest from
/ the date of issue. He further showed
! that the amount of interest so paid, to-
! gether with the whole cost Of negOtia-
/ ton, including the engraving and print
! ing Of the bonds, was reimbursed to the
/ treasury in the saving of interest by the
new issue to the first of June last, and
I that there has been since saved over
one million dollars in the reduced in
/ terest. The annual saving from that ne.
I gOtiatiOn amounts to two millions of
/ dollars with the interest annually
/ accruing and compromising therein
/ during the term of debt. The Sec
rotary considered this plan the best
! that could bedevised, involving the least
cost TO the Government, while it did not
interfere with, OF in the least derange,
ordinary operations of mOnied or COM
mercial interests. Mr.. Cooke said he
had little to add to the SecretaFy's state
ment. He would refer, however, to the
fact that when the Government was a
borrower at high rates of interest, all
other borrowers, as a rule, We're obliged
to pay still higher rates. The lower the
government rate, the better it was for
industrial and commercial enterprises of
all kinds. His firm conviction was that
the attempt to sell new four per
cents, and to retain the proceeds of
such sales in gold until the six per cents
could be brought in, would create 4
drain of money from its ordinary chan
nels that would speedily check the sales,
and thus effectually deprive the Govern
ment Of the means to redeem the five
twenties. By a plan recommended by
the Secretary this difficulty, as shown
by experience, would be avoided, and a
conversion into new bonds be effected
without the slightest monetary or COM
merciaI disturbances.
BoUTwELL's REPLY TO CONGRESS.
The Secretary of the Treasury to-day
forwarded to the House of Representa-
tives the following letter in reply to the
resolution of December Sd, asking the
Secretary to inform the House under
what law authority was given the Sec
rotary Of the Treasury to make an in
creased issue of legal-tender notes, as
was done in October last, etc. Il
Il have to say that the amount Of
United States notes in circulation was
increased in October last on the order of
notwithstanding Richardson, then
acting Secretary in the absence Of the
Secretary Of the Treasury, in the sum of
about five million over the amount out
standing, when the act of February
4, 1865 became q law. The object
Of the issue was for the relief of the
business of the country where men are
suffering for a large demand for cur
rency in the South sand West. The
condition of affairs existing in the cOun-
try seems to me to have warranted the
issue upon the ground of public policy. |
The authority for the issue is found in |
the acts of February 1, 1852, July IS, |
1852, chapter l42, and March 3, 1868, 1
chapter %. At the December term, 1865 |
Of the Supreme Court Of the Uni. q |
States, the Chief Justice in giving the |
opinion of the court in the case of the /
Banks as. Supervisors, 9TH volume Wal /
lace, 18th page, said that the act OF Feb |
ruary 26th provided for the ISSUES of
these notes 70 the amount of 500, DOC, 900, |
and the act Of July Is, 1862, added an /
other $3.50, O00, 900 to the circulation, re-
serving S5,000,OO0 for the redemp-
ton Of temporary loans TO be /
issued only when necessary for that pUr- /
pose. Under the act IF March 3, 1853, !
another issue of SljO, U5D coo Of the au-
thorized $50, eco, 900, and contemplating
q permanent circulation until the re-
sumption of the payment in coin Of So
000, 600, was made. At the December
Term, 1859, of the Supreme Court some
view was again expressed by the Chief
Jurtice in the case Of the Nesil Bank u.s.
FeunO eighth volume of Wallace, page
five hundred and thirty-seven). This
opinion is in accordance with the uni
form opinion of the Treasury Depart
me 4, and with the practice of the
Department, as well as the sense Of the
act of February 6, 1865, as previous
thereto, the cancellation and deduction
of notes that have been issued Ey the
Treasury Department, has no legal
effect on the power of the Trea-
sury Department to issue any notes
in their stead, and is apparent from the
language employed that the act OF 1868,
already referred to, and in that act it is
provided that in lieu Of any notes, or
other United States notes returned to
the Treasury and cancelled or destroyed,
there may be issued equal amounts, such |
as are authorized by this act. Previous
to the fourth of March, 1863, large sums
of United States notes were held in the
Treasury at Washington as a surplus
fund on loans Of S356, 900, 900 reported IN
circulation for the purpose Of meeting
a sudden demand on the Treasury,
and that practice has ever
since been continued. The notes
are lot printed for any special issue. On
March !, 1869, there were outstanding
more than forty-seven million dollars Of
three per cent certificates, payable in
legal-tender notes on demand, and a
surplus in reserve at the command Of
the Government, for meeting any call on
account Of this liability, from this
surplus issue in October last was made,
and all new notes put in circulation are
drawn from the same source. Very
fSignedI GEO. =. BOUTWELL,,
Secretary.