, 1873-12-03
MONEY AND COMMERCE,
MONETARY.

TUESDAY EVENING, Doc, 2.
Money Is steadily boconing moro plenty, boil,
In this market and tho East. Az notol In Our
srt'cio Yesterday tlloro has boon declire In tha
rate lof mouey on oollatoraa in tho opon mar
Let III this city from 10 per cont per &nnuln
WHICH Was the ruling ratio lnst wock, to 19 por
cont now The prospect a!so In tint it will not
10 long bcforo money will be otrorod at even 10
per cont OIL flrRt-ciass col1atcrals. soveral of
tho prominent banks nro now disaounliup freely
Tor their regular customers ut tho usual 10 pcr
cont, though tue poyk-packors atill ubsorb n
great portion of all that ths bnnks can lend
Currency ia getting very plenty, both horo and
In Now York. In tho latter city. tho banks arc
reported as having moro National Dauk notos
tlaa thoy can use. aud wo havo seen private
kilograms from there, asking bal.hors here II
they can lud usc for them.
Tile increase of loRnablo capital In this mnr-
kot III shown by tho greater abundance Of Now
York exchange, which Is now down to about par
FOR salcs between banks. Tho shipmolts OF
"hog-product Eastwatd are 40 largo that 1t is
not improbable that exchange will Hoon so below
par, and currency begin 10 flow Westward from
New York,
NATIONAL nAHK RESERVES.
Among tho o1tracts, now boinR published,
pf tho Currency is a very lengthy ono on tho
question OF bank re ReryeB. Tho Comptroller
starts off on this topic with the assertion that
The advocates Of q freo banking law aso ad-
vocacs of tho repoul Of ths chief restrictions Of
M he Saonsl ,',ir Currency ast ana raritniHry OF
tain amount Of moAoy ~ reserve against Iabtli-
ties.
To this assumption 70 dissont nnd claim that
tho great majority Of the advocates of froo
bankiug ut least in tho West) do not ask for
the reEeol of tile requirements for rcsorvo, but
only demand that there ahall DO no longer q
m monopoly Of the privilege Of issuing ourroncy,
- lB now maintained by Tho restriction Of Ma
ito nal Bank calculation to es5A, 100000.
The Comptroller gives tho Same reason for
maintaining tho requirements for reserves Us
Tere given III this column soue monthg ago,
when tho Now York papers began to advocate
their repoal, viz:
Such laws not passed mich for tho benefit Of
thoac parsons WHO conduct their business Tn Hound
which has but little experience in tho method Of trana
acting legitimate hua!ness. II the law be correct IN
prnytpe, it will bc found not to Interfere with the
rights o 4oHe pcrBons who understand tho trno tho
CRY OF bualnesa but lts sonlenry will 10 to prevent
abnses on the part Of those who would otherwise lake
risks which prudent and careful man would aroid.
Thia is, in fact, tho whole argument in behalf
OF reserves, viz: that there should be some
standard normal condition, to which every bank
Should be obliged to conform at all times, OK
ccpt In sonlo emergency. Us in panic, or when
it Ia necessary to give unusual nd to it's oua-
toners In legitimate business to prevent huH-
pensions aud pauics. On these points lie argues
~ followB
To claim that = bank cannot redeem, its own uo!es
depositors demand il ths payment Of strl tebts
sha intronch upon it, Reserves IL equivalent to .e
proilo for tho destruction Of thu very institutions
lnd created. From the frat organization Of the sys-
tom to the present tins the Uniform decisions hare
been that tho object Of tho reserve ia to cuahfo tho
bank At all times to ray its aob,s. In times Of panic
the deposition Of bank is tho aster. aud not It's o.
bank. liable At euch times to bo called upon to pay
ia debts, would, II thoro laws, loan
eredors ii hs risK ot sost ceraIn failure snd d.
graco.
There ih no question but that t1is has hoon
the view taken Of their reserves by I'LL tho
National Banlis Ut the country. During tic rs-
have paid out its reserve as 1oug as 1t Ind any
left, aud il any National Bank kept ita resorvo
untouched through that emergency, It was not
from any respect for the Inv, hut simply be-
cause they did not find it necessary to draw
upon it to pay checks Of their dopositors. The
construction put upon tho requirements for re-
serves by the Comptroller Of tho Currency Elyes
prosumptiye legal authority for all the liberty
10 that respect that any acknowledgements
bank can ask, mud the actual repeal OF the law
by act OF Congress would ba Bupertiuous, al far
as granting aily reasonable liberty to the banks
ts concerned.
run rnEs1pEsr ON 'sE1Asr1ol7x OF THE cum
NEScY."
President Grant-like every other man in tho
United States now-a-days-haa " financial
plan which is to be the grcnt pa,,acea for nll
with. The President proposed to mako the cur
rency clasto by authorizing tic National Banks
during the season Of currency plethora In the
summer-to diminish tlleir circulation by re-
withdrawing 80 many United States bonds rs arc
pledged for the redemption Of tho notes. lnas-
much as tho National Banks already have this
privilege recommended by the President, it ia
impossible to aee how it would facilitate con-
traction Of the currency in HeasonB OF currency
plethora any moro than it does now, which is
just none at NIL.
Tho President, however, also recommends
that, in aeaHons Of currency 6carcily, banks be
allowed to increase their circulation 40 per cent
oyerand above tho ordinary amount. This atl-
ditioual DO per cent to be issued TO them to tho
full par value OF Uuited States bonds offered by
the banks. Ho would have t}lis additional cir
culation considered III tic light of u loan by tho
Treasury to the bnnks. for which loan tha banhs
should pay per cent interest until the circula-
Lion was returned, and the bonds deposited Is
sollateraD were withdrawn.
INTEREST ON nEroslTs.
Tho President recommends that tho National
Banks bo prohibited from paying interest OIL do
poait1, and that they bo required TO keep their
reBerEeH all in their own y2ultH, inetc4l OF half
Of 1t on deposit with tlloir rodocnng agents, as
DOW. It is safe to say that If these two PROPOSE
tlons should become laws, and could be made
operative, one-Aalf Of the National Danls OF tho
country would wind up, and rooyganize either ~
State banks or private banks.
LOCAL sroCE AND BOND MARKET.
Mcssrs. ploston, koan Il Co. quo1e as follows
this p. m.:
buying. Selling.
y. 9. G. Of ~ :.:....... ...."....lld5i 1l7.1
.. 3, 6-o0s Of f62,.......-.........11D!{ 1lhn
q. s. b-1Uz of "a .,ll9H 1l1l
.. s. 6-20a Of 65 -. ..,.......1}1A 111A@1l.H