The New York herald., 1875-12-01
THE CIRCULATING MEDIUM.

REPORT OF THE COMPTROLLER OF THE CUR
BANKING SYSTEM ANswERED-THE EFFECTS
OF THE PROPOSED REPEAL AND THE SUB
sTITUTIoN OF GREENBAcKs CONSIDERED
EXISTING MONETARY PROBLEMS.
WASHINGTON, D. c., Nov. 80, 1876.
The following are extracts from the forthcoming
port Of the Comptroller OF the Currency
One Of the principal objections urged against
the national banking system is that Il is
authorized and continued at the expense Of
the government The Of this is true
being monopoly, has, in fact, uprooted
the real banking monopoly which has existed In this
TO late day. Should the national system be unfortu
nately overthrown that monopoly would be again and
revived by the repeal OF the provision imposing
tax OF ten per cent upon the issues Of State banks,
which provision is acknowledged to be one OF the
pcnsations OF the very erroneous idea prevails
to the amount Of the profit derived by the
tona banks from their circuation but to show that
the profit from this source is not nearly great Is
supposed by many persons II is only necessary to
take consideration the amount OF capital the banks
necessarily invest in the United States bonds required
their circulation, with the legal restrictions
that govern their business and then TO compare the
combined received by them their bonds an
circulation with that which would be received the
same capital loaned bond and mortgage security but
free from the restrictions governing national banks
on November l. 1875 there was on deposit with the
Treasurer security for the circulation of the national
banks $36 $40 412 in the various classes Of bonds Of
the United States II from this be deducted the
held security for the notes of the national
gold banks and also the amount deposited in of
that required by law to the circulation issued
upon them there will remain 1851, ,40S, l2 Of bonds
worth in currency on the day named SAFE, $40, ,533
PROFITS OF THE BANKS.
II s urged q further objection TO the national
banking system that the dividends paid to stockholders
are greater than the earnings of other corporations II
y true that some national banks which have accumu
acd large surplus organized In localities where
tne proportion Of deposits 10 capital Is large At rates
OF interest as high In the Western and Southern States
40 declare large dividends but II is well known that,
s arue the rates OF Interest charged commercial pa
the national banks in their respective localities
less than those charged by State banks private bank.
ers and individuals but the dividends aud earnings OF
tne national banks do not, n rule exceed by more
than TWO per cent the current rates of interest author
izeu by law IN the respective States and this additional
amount ofproh is surely not too great compensation
Tor the risks and expenses incident to the business OF
gage security Is not subject
THE SUBSTITUTION THEORY
II mas been proposed to withdraw the national hank
notes from circulation, and to authorize an ADDITIONAL
issue of $4OO 600 Of greenbacks the latter 40 he
Interchangeable, In sums Of $50, for treasury notes
bearing interest at the rate Of 65 por cent nor an
mum, or one cent per day on each fl0O ana N "a
peal all acts tending 10 resumption OF pavment
In specie. The gfeenbacks received by The Treaa
ury IN exchange for the 65 notes arc 10 be
used for purchase Of six per vetwcny bonds for
the purpose OF saving interest to tho government Tho
OF February "a, 1915, has been seen authorized
the issue Of Treasury notes OF tho denomination az
500 bearing interest al the rate OF one cent and one
hall cent per day 10 be computed At the one