Mineral Point tribune. (Mineral Point, Wis.) 1869-1938, 1873-12-11
Report OF the Comptroller of the
Currency.

htt"ii VI the NoIlptToileT OF tHe
Currency.
The Comptroller Of the Currency in his report
gives a history of the working of the free banking
system IN the country previous to the establish
mcnt OF national banks, and goes to say that the
amount of national bank notes now authorized To
he issued is >}5l 90 600 and the amount OF lpval
tender notes $500 100, that the proportion of
legal-tendors in which national bank notes are
now redeemablc Is nearly identical, though slight
~ IN excess. If the national banking law was
amended 81 A. 10 require the redemption Of nation
al bank notes in legAl-tendor notes ut one-fourth
OF one per cent. discount as in the New York
STATE law, instead OF al par, rs provided in the
national currency act. and the national banks of
thc whole country would agree 10 such provision
oi law, the prompt redemption of national bank
notes would be insured bur the redemption of the
vast amount OF circulating notes. II redeemed but
once year, would result in great loss to the poo-
pcot the United States. A system of redemption Of
TINS klnd would also at once increase the rate of
exchange from the rate Of One-tCnth OF one per
cent, now existing at most periods of the year be-
tween different cities of the Union, To from one
haH 10 one per cent, ihU- restoring 10 considera-
Die degree the condition Of exchange nt the time
of the inauguration Of the national banking system
and lnsuriug u loss to the people annually Of
millions or dollars. such system would,
however, undoubtedly result i'm the return
OF the notes Of the national banks at
certain seasons Of the year, when they were not
needed, 10 the vaults OF the country banks to be
paid ont when the demand for currency increased
such system would also give what Is exceeding
" desirable ut present elasticity TO the currency
In order To insure the prompt redemption of the
national bank notes the amount issued must be
80 much Increased mat the notes will be- say,
eighth or one per cent discount and this would
probably not be accomplished until an addition
was made 10 the present circulation of SltO,0O0-
uUO, The same result would follow from rcduC-
ton Of the volume of legal tender notes stimuli
taneously with the increase of the issues OF bank
notes but Congress has SO frequently refused Ia di-
rnsh the amount of legal tender notes, 80 that the
Comptroller IL OF the opinion that any general sys-
TEN of free banking accompanied with resumption
must be postponed until the resumption of specie
payments. The Comptroller, in order Ia avoid any
misapprehcnsion of his views upon this subject.
desires 10 state that he is not an advocate Of any
permanent system OF currency usually known "a
irrcdccmabc currency. He believes however
that the people of this country ought not and will
not submit to the high rates Of exchange prevail
ing previous to the war, aud that an amendment
TO the national currency act which shall result in
restoring the high rates Of exchange will also re-
suit in the downfall OF y system of banking
which, il is believed. win yet become
the most satisfactory Of any system ever establish
ed. During the past year as far as observation
has extended, national bank notes have been rare
ly al any perccpuhle discount for legal tender
notes, and during the late panic no distinction was
made by the people between legal tender notes OF
the United States and national bank notes. both
Were boarded alike rs thing most desirable of all
others to hold And II IL probable that when spe-
Gle payment shall be resumed the faith Of the
people win be well established in the safety Of
the currency of the banks that no such general
system of redemption will be required ms OF the
unsafe currency issued by the different states pre-
Nous TO the war IL circulation should become
redundant, rs IL sometimes the case with silver
coinage, 1t will only be necessary 10 present The
surplus To the agencies In the city OF New York
where more than lwo-thirds Of the circulation h
now rcdecmablc, In order 10 restore equilibrium;
for II IL TO be hoped that previous to the return to
specie payment some system will be adopted
which will give abundant elasticity 10 the curren-
cy without mourning the expense and burden Of
general redemption aud without loss resulting
from the high rates of exchange which have al
ways prevailed under such "A system.
Regarding the question of interest on deposits
and ccrthcation OF checks, the Comptroller says
In my last annual report referred briefly 10 the
evils resulting from the payment of interest upon
deposits, and my predecessors have frequently re-
fcrrcd more nj length 10 the same subject, The
difficulty has been that the proposed legislation by
Congress upon the subject would apply only to
national banks. The effect OF such legislation
would be TO bring State banks and savings banks
organized by the authority Of the different States
IN direct competition with national banks in socur-
ing the accounts OF correspondents and dealers
The national banks viii be DESTROYS of retaining
their business, and the more interruptions would
not stop 60 eNadc the law by offering 10 make col
lcctions throughout the country free of charge to
buy and sell stocks without commission. aud re.
discount paper AT low rates.
THE kind Of legislation needed II that which
shall apply To all banks and bankers alike whether
organized under the national currency act other
laws. A law prohibiting the payment of interest
on deposits by National Banks viii have little eff
feet, unless followed by similar legislation under
authority of the different States, aud there Is little
hope that such legislation can be obtained a"
The Comptroller repeats the recommendation in
last years report fora repeal of Section o. of the
act of July. 1870, which provided that after the
whole Sii,DO0000 of circulation shall have been
$250Nu,000 additional shah be with
drawn from the banking associations organized in
States having excess and distributed among
States having less than their proportion. Under
this section that amount would be withdrawn from
New York Massachusetts, Connecticut and Rhode
Island, and the Comptroller also recommends the
of S23,Ou0H0 more currency, 10 be
distributed among States which are deficient,
namely those Of the South and West. lie Is Of the
opinion that Il would require from three to five
years 70 distribute this additional amount