New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-07-31
Is IT AN ASSIGNATf
THE CONVERTIBLE BOND NOT MEASURE OF IN
FIATIOS


tn the Editor Of The Trtbune.
SIR: Your articles as well as those of your
eorcs pondcnts upon the Convertible Bond. tempt me
into the discussion So far from desiring to innate inc
currency would contract to the hard pan OF specie
winch is the only safe substance for currency because
docs not depend upon the Judgment wiis, or interests
OF any man body Of and cannot be produced or
DESTROYED rapidly enough to dsarrage business cacua
tions Too much currency has made merchandise OF our
silver and gold which is bought like wheat corn Oh
cotton. settle foreign balances-thc DEBTOR puyihs
whichever will his purpose best There Is bat one
way ont of this-cOntracton. 1t Is hard ROAD ala
shrnks the nominal value of property used to pay debts
interest and taxes and adds that shrnkago to the value
ofte money lenders bonds notes and incrst Mr. Bout
wells policy was contract gradually by keeping the
currency ot fixed volume until tho increase of business
population ana the loss from Its destruction worked
q cure. This a slow process Others proposed 10
reduce 1t by exchange for some form OF intereecdng
debt
Thoore graspng advocates of tho latter policy wanted
grcenbacks exchanged for Ave per cent god Interest
bond which would work with great radity in shrinking
values. and enrich lenders IA rapidly "a IL ,npoveSheu
borrowers Others would iniercsbearinS note In
exchange for the legal tender which would gradually be
changing from circulating note into an Understanding
investment; while others still wOad have low rate OF
interest bond convertible aud reoonvortble 1t Is This
last policy which the advocates Of the other schemes
oppose more by Idicu,c and denncation than 10y arg
ment but which TO have merit than prospect
of success Whyi
First: Because 1t would diminish deposits sent TO
the money centcrs ana loaned call (which is the banc
Of honest business and when wanted again in the coun
try enables the monoyendcrs 10 get extortionatc rates
Of interest between tho wants OF honest business and the
necessities OF borrowers on CAL.
Secondiy II would diminish niltcd loans upon de-
post debts with tine TAT dividends received from Them by
bankers who suspend payment When their initiation works
mischief and let the community sur the losses ol tncr
reckless lending upon thcir denis.
thirdly: 1t would enable the Government 10 get
cheap from the people, and pay oil hsh loan win
surplus coin, instead of selling it, as ROW, To get cur
rency for its running expenses . ,.
Here reasons enough why such measure does not
promise be against bank owners md money
lenders and those within their control Tnero are prob
idle Which might now be retired by the aid of 800
vertblo bond without injury to business ana When INC
temptation of interest would prevent from returning mo
use II will take the retirement or twice tat amount 10
reach specie payments; But here comes in the scdge
interest for idle money! Thee IS great force IN
the question from believer In , unli-"it net
from these who would convert gleeubacks without In.
rest into intere, bearing sees RON my POM n :"
q. contraction, which might afford some RELIEF when con-
traction became too severe fosso II 'gn n,% c use"
are. hut not for tue common uses OF currency III retail
merchandise IL would give frxibIIty the currency
While reaching specie, and afford relief III times OF
Guile such measure begged Grant apd Richardson to
put out all the recnbacks in the Treasury Tor thcir SAL
payments 10 their drpositors. what would they have
done with b-hOhiers asking redemption al the same
az low rate OF interest (Which would he paid
and keep at home instead OF going abroad from
balances KEEP. by administrators and executors or es-
taes insurance companies and persons ana companies
having funds awaiting distribution; go . ~
Now, IL $3.50 convertible bond VIII give the Govern
nent large loan al low rate. absorb surplus currency,
aid stability and prevent the .At0ruoDs when follow
caOan spcculaons, aud brSidos save some millions 81
tXes now used to pay high rates OF interest II is entitled
fair treatment and 30 are the men VINO advocate IT,,
nOtw Outstanding may reduce the mon cndcrs pr0tts
and the stock obbIs gains II - measure which con-
tracts Only te clrency circulation, but The aXes
and the rate of interest. EN-
Washington, ID. e., July 20, 1919.
fThcre appears to he no manner Of agreement be-
tween the various supporters of the $50 scheme.
Nevertheless the purpose Of nine-tenths of thcn eN-
IDENTIFY is to change the funded debt Of the United
States into paper money We call the proposed
bonds dssgnats because IT is fact that tie dsgnas
themselves were called bonds. made legal ten
der were received for taxes, bore interest at the
rate Of per cent were deprecated from the start,
and became worthless in the end. If that is not
what Mr. William Brindle advocates in the letter
printed above then the English language, like
the legal tender dollar, has undergone a
depreciation. Mr Carey and all his school
agree in calling the one, two and tlree-year five per
cent Treasury bonds and the 1903 money, though
they were not convertible into grcenbacks on de-
mand. This name, them they cannot refuse TO their
Bios, which are to DE convertible at the will of the
holder into legal tender. They propose, and
respondent proposes, that instead Of keeping the
grccnhacks 70 pay back TO the holders of 3.65s, the
Government should pay them out again, whether for
current expenses redemption of the funded debt
makes no DILIGENCE, far regards the question Of
imitation. How man, rs sensible as our CORE
pendent shows himself in the first Ia of his letter.
can fail to see that this is initiation is truly aston
ishing.
Some of our correspondents epithets are. it seems
10 us a little ont of taste. No advocate of the
sttutional currency. however "grasping,' demands
anything more than that the Government should
keep its promise. We do not believe, and history