The Kenosha telegraph. [volume] (Kenosha, Wis.) 1860-1888, 1873-12-18

OF National Banks, but OF State
Banks and private bankers, OF pay
ing interest on deposits attracts cur
rsncy from all parts of the country
to large cities, especially to New
York, the great financial centre, at
seasons of the year when there is
comparatively little use for currency
elsewhere. Immense balances &C
cumulatee in New York, where, not
being required by the demands of
Legitimate and ordinary business,
they are loaned on call at a higher
rate Of interest," than that paid to de-
positorS, and are used in speculation.
Evsry year, st the season, when the
demand sets IN from the West and
South for currency to be used in
puymsnt for any transportation Of
their agricultural products, there &c.
|
curs stringency in the money mar
kSt arising from the calling of such
loans to meet this demand. Until
this year, though annually creating
some embarrassment. this demand
has been met without serious diff.
Guilty. During the past summer, an
ticipating the usual autumn stringen,
cy, the Treasury Department sold
gold while tho market price was
high, currency abundant, and bonds
for sale in the market were scarce
and while thars was surplus Of
gold in the Treasury, and thereby
accumulated about $14,OOO,00o O
currency, with the view of using th'
same or such part thereof a. might b,
necessary in the purchase Of bonds
for tn e sinking fund at times during
autumn and winter when they could
be bought at price not above pa
in goll, or in meeting demands upper
the Treasury, as circumstances
should require. This year there wa
8 great demand for currency to pa,
for the heavy crops Of a bountifu
harvest, for which European coun
tries offered . ready market. The
suspension of certain large banking
houses, the frat of which OCCUR &C
on the 18th of 9Ssptembsr, alarmed
the people as to the safety of the
banks and banking institutions II
general. Suddenly there began 1
rapid calling in of demand loans, ant
q very general run on the banks fol-
the withdrawal of deposits. Entire
confidence was manifested II
United States notes, and even in Ma
tlonal Bank notes, and they wer
drawn wherever they could be OBJ
tanned, and were largely boarded
with as much avidlty as coin wa
ever boarded 10 times of financial dis
tress when that was the circulating
medium Of the country. The bank.
found themselves unable to meet tn,
demand npon them currency in cir
culation became exceedingly scarce
and the business Of the country be
came greatly embarrassed. In thi
condition Of things, great pressure
was brought 10 bear upon the Treas
ury Department to afford relief b,
the issue Of United States notes
The first application came from 8
number Of gentlemen in New York
suggesting that no measure of relic
? would be adequate that did not plac,
at the service of the banks of tina
city $2O,OoO,O0O in United State
notes, and asking that tho Asslstan
Treasurer at New York should b,
authorized to issue to those bank
| that amount of notes as q loan upol
a pledge Of Clearance-Houss certif
Gates, secured by ample collateralp
and for which the certificates of al
banks were to be jointly and several
ly. responsible. This proposition wa
declined, it being clearly not within
my duty, SO the authority of th,