National Republican. (Washington City (D.C.)) 1872-1888, 1874-03-24

thai prsaisn $1,000 4 . hi6Ase ne = -
nlnn, which evsa ~ e6tAln1, ~ 0evosa1eat
900 - premium - the aneunt Il boall
retired b the Ssorstasy, snd TIA "a, whsa ths
public dsStsvsa aew sxessds a - a. ~ aosv.
sransat policy az Il en- b AsAoaisassd sasA,
| without . parallel b ths hlstoey q natioaa Ths
scandnsss &C wisdom of The policy herein rseoa-
mended. taken - whols, IN the present eoadi-
ton Of our natieosl adais, whoa fAirly soateastsd
Win tnat which has obtained, vii b apparent 70
all vslllnformsd msa. 80,
Tnsre . limit % the eonditioas % which fsss,
primarily. The peodsctivs sesfgiss u every
people; the people Of ths Uaitsd ststss are 70
excepdoa 70 thistruism. 50. too. It 70 impeseiDis
to foesss OF dsans The extent and severity Of M
tional exigeaoiss or the oorrsspoodent extent and
variety Of the means which nay b necessary 70
satisfy them.
Notwfthstandins the existence Of the psbais
debt, sound statssnaaship unqusstisaAbly die
tates that the 0ovsrnment shoQld always b kept
in condition 70 meet the vio,ssltsdss 70 vhish
national ufs % exposed even under ths most
favorable oirounstaness.
The extraordinary haste 10 pay OF the pablle
debt heretofore exhibited was ill-foandsd aad
llusory, and In fsst the proxinass saAeisat ss1ss
Of much Of our present dimeultiss.
What the past and present policy requires % b
greatly modified will not b Qusstioasd By thoss
who have coasistsnt sad patriotic regard Toe "
welfhrs Of the American people, for expsrisues
teaches that Il b not the existsaee Il dsbts b the
past Of solvent nations ct Low rates q interest
which lessshs the measure Of their prosperity,
but the existsnes OF debts due By bankrupt ~
- 1Al, tkaws A.
Section two authorizes the SECRETARY Of the
Treasury to receive and hold the proposed $500
bonds in lieu Of sig per esnt. boads for the ~
demptiou Of the notes Of the national banks.
The foregoing estimated valas Of s-loo bondA,
immediate and prospective, Will eoncluslvely
show the sumclency Of the security which would
be pledged for the redemption Of national bank
notes, and would continue to b % By reason Of
future augmentation Of population aud values,
the only reliable basis o. which to predicate any
sound financial policy.
It will be seen, however, there ID nothing Of .
compulsory character In the provisions Of this $50
tion. The national banks may OF they may not
avail Themselves Of IT. provisions. II enacted It
will necessarily be . matter Of Involvement.
Ifthey can advance their interests thereby, II u
reasonable to suppose they will do %; and II %,
demand for 100 bonds viii be created equal to
the whole amount Of bonds deposited BY them
with the Department under the existing laws, to
say nothing Of the amount required BY the hold
ers Of legal tenders. BY way of conversion, other
wise provided for A demand % created amount
Ing to ess2 s52, 100 would unquestionably give .
financial status to the proposed bond Of great i'm
portanoe, in aid Of an entire funding by degrees
and in time Of national bonds now outstanding.
1t being, therefore, question Of inducement on
the part of the national banks, let NJ SEQ how
great IL the inducement practically offered them
by the provisions Of the different sections Of the
bill.
Take for instance banking association having
acash capital Of t2oo.00o and about to commence
business under the present law, Government sizes
commanding about 20 per eeut. premium, such
association can only purchase bonds Of the par
value Of say tleo.o0O. The law requires margin
Of 10 per cont as additional security with the De-
partment, or tis.ooo. Deduct this amount, and
there is left Of the cash capital tlsA,000 Tho
present law also requires Is per cent. (where the
banks arc located In the eities) ~ reserve to be
kept hand which 10 Of course idle capital, land
Is per cent. by the country banks) say ga, CO.,
leaving the association bsnk-note circulation for
discount purposes Of clos 900 Independent Of de-
positors. Hence, what amount Of interest would
the bank receive - the law now stsndsf
lst Six per cent. on tloo 900 OF bonds
deposited with the secretary or $500 90
ID. Seven per cent. on the amount OF
circulation not otherwise appro-
priated, or on tlos 900 1850 90
Total amount of receipts arising from
interest and discounts - 100 90
This amount, II It 10 . country bank, would be
slightly increased.
Under the proposed bill the interest would
stand as follows, to wit:
LIST. Six per cent. on 100000 :. :. $500 %
I'd. Seven per cent. on the amount Of
reserve, go. s::350, Independent Of
depO6its N,1oo W
Cd. Seven per cent. on bills discounted,
independent ofdeposits, el0e, 900 7,sco 90
4th. The banks will, by the proposed
bill, have the right, also, to In
crease their capital stock $4,000
on the basis Of 12O0,000, In which
case their note circulation, on the
same terms and conditions, will be
increased twenty-five per cent, tie.
the fourth part OF 900. less re-
serve and ten per cent. margin - 2,lso 90
Sum total Of interest 2,oso 90
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