New-York tribune., 1874-03-30
pr TELEGRAPH TO THE TRIBUNE.

OPINIONS On THE FIVE PER CENT RESERVE PRO-
VISION.
IBY TELEGRAPH TO TIE TnIBUSEl
WASHINGTON, March 29-The Free Banking bill
was discussed in written speeches on Saturday
by number Of gentlemen whose talents and expe-
renco wero not such to enable them to throw much
new light on the subject. The debate will be re-
sumed on Tuesday, and will probably be concluded
some time during the present week. Mr., MaynaT
has not decided whether he viii admit aThendniehts
or call the previous question the bill as it stands
II he is wise he win take the latter course for if the
measure is thrown open TO amendment, the imitation
majority in the House will be apt to strike out
the carefully matured checks on wildcat"
banking which it contains, and will certainly
reject the specie payment section. This
section is only promise that the Government will,
two wears hence begin taking short monthly steps
on the road to resumption. 1t is as If man who
has Journey Of 400 miles to make should resolve
flat he will start at the end Of two years and will
travel two miles month toward his destination.
Long DELAYED in its beginning and snail-hke in its
prosecution as the progress toward specie basis
proposed by the bill is, the nhatonistS are afraid OF
il and will not vote for it unless they are obliged to
choose between doing and rejecting the bill alto
gether. They do not like anything that so much as
points in the direction of an honest stable currency
experienced fnanciers Of the probable operation Of
the five per cent reserve provision in. the bill This
nrovision relieves the banks from the requirement
70 keen legal tender in their vaults for the
redemption of their notes makes the Treasury a
general redeeming agency, and obliges every bank
IN denosit therein an amount of greenbacs equal to
five per cent Of its circulation. As fast this
duced the bank must make 1T good 1t is claimed on
one hand that this will greatly increase the profits
of banking and thus stimulate the formation of new
banks and the consequent expansion of the curren-
cy because it largely reduces the amount
of the reserves. At present. banks In the principal
cities are obliged TO keep idle in their vaults an
amount of egatender notes equal TO 25 per cent OF
their circulation and other banks Is per cent The
rcdncon of these reserves to five per cent and their
transfer to the Treasury would, it is argued add TO
the active capital of the banks the difference be-
tween and Is or 25 per cent of their present cir
culation. besides relieving them of the trouble OF
redeemiug their notes This was the view taken by
Mr.. Mitchell of Wisconsin in his speech on Friday.
He also said that the provision for redemption at
tbe Treasury would be of little in restricting
oyerissues because it would be imperative
On the other hand, it is held that this new method
of REDEMPTION will be far more effective than the
present one which really amounts to very little and
that the NewYork banks will daily sort out all the
bank currency received during the days business
and send it into the Assistant Treasurers office to
be converted inc crisp, new greenbacks The pro-
cess of redemption it is believed, will thus be going
on all the time, and the necessity of keeping their
five per cent deposits good will act a powerful
check on the establishment of superfuous country
banks This view is held by number of expert
fenced New-York bankers and no doubt will be pre-
sented to the House by Mr. Phelps. who speaks on
Tnasdav