The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1877-02-21
MoRRILL's GIFT OF sS,000,O00.
The New York Journal of Commerce 81

MoRRILL's GIFT OF SSO0O,0O0.
The New York Journal of Commerce says:
We have been asked several times by what
authority secretary Morrill, "makes a present
to the syndicate OF upwards OF s3,OOO,OV extra
interest, in addition To the handsome profits
and commissions allowed them for placing the
new bonds" We answer that We do not know
of any authority in law for such donation,
and as the secretary thereby increases the
public debt we think il is in violation of law;
but what is any body to do about it, We can
not ego back on the secrctarys nat; what
ever certain officials now do is beyond the
reach of popular indignation. The mode may
not be understood by the uninitiated. 1t is
this: The secretary issues call for say ten
millions of the six per cent bonds, the interest
to cease at the end of 80 days. He then issues
new AZ per cents. 10 the syndicate, bearing in
terest from date In the final settlement all
the called bonds bear interest up to the ter
mi ation of the call, and the new bonds also
bear interest from the date Of the call, thus
paying double interest on the entire loan for
that period.
CONTRACTION AND PANIC.
write~, signing himself Banker, in the
New York Daily Bulletin, commenting upon
the statement that the contraction Of legal
tenders since the act Of 4th January, 1879,
amounts to sT,OOO,OO0, and in the national
bank notes SSl ,OOO,OOO, says.
The contraction in the national bank note
oircu alton having been voluntary, has in
jured no Legitimate interest of the country;
but the con traction of the legal tenders being
forced by legislation, will prove exceed
ingly injurious whenever the business of
the country resumes its ordinary extent
aud activity, and il persevered in, and If Sl01,-
OO0.OOC of legal tenders be converted into
United states bonds and Cancelled, as pro-
posed, shall have in this country a money
panic that will be as severe as my previous
oneeVer experienced in the United states. The
general public suppose that when money Is
scarce II Is because of scarcity of circulation,
whereas IL is due almost entirely to con-
traction i'm bank discounts, which does not Bct
on the bank note circulation, d u on the de-
pOsits against which checks are drawn and
used to paw maturing pecuniary obligations
payable at banks; and as the banks of
the large monetary centers are forced
times in legal money p per cent of
their entire liabilities, except circulation, IL
issue of legal tenders entails forced contrac-
ton of S6S 300 0U0 in the discounts of the banks
OF the great monetary centres OF the country,
because the contraction mainly comes out OF
the legal reserves of those banks: and should
Sl00, $4,000 OF legal tenders be Withdrawn and
canoe ed by the issue of United States bonds,
as proposed. il is impossible to estimate the
amount of the contraction in the discounts of
the national banks of the United States, which
will be forced upon them by the impoSsibility
of maintaining the legal reserves neces-
sary to the maintenance of their
ordinary discounts. Why is it
that the business men and bankers OF the
country do not see that the withdrawal OF
legal tenders a preparation for resumption
deprives the banks and the community of a
forms AL the functions of gold in the interior
monetary transactions of the country. and
that when this legal currency is Withdrawn,
il must he replaced by some other lega, cur
rency, which will have TO be gold, since none
other is - legal tender, except silver, and that
only for limited amounts? The government
OF the United states admits that Ii is inp posi-
BILE to import any large amount of gold from
Europe. How, then, can our banks obtain
Sl0000OUO0 of gold TO replace the legal tenders
proposed to be withdrawn and Cancelled? And
how can the business of the country resume
its former Importance and activity If our
banks can not obtain the amount OF legal re-
serves required by law?
But cease the contraction of the legal tenders
and make them convertible into coin at the
su b treasury on demand, and REISSUE them 1t
once in the d disbursements OF the government,
our currency will at once bee me Of equal
value with 9 I'D, ana no addition to our pres
during the whole of the time of the suspension
OF ,pecie payments, the country has b en-
forced TO iiquidate its foreign Indebtedness In
coin or its equivalent precisely rs II specie
payments had beel sustained. Hence. re
umption, instead of requiring larger gold r =
serves, in fact viii enable the country to effect
all its monetary operations with a less amount
of gold, because resumption will diminish the
cost OF everything produced in the United
ducts and commodities, and thus lessen in
stead of increasing our exports of gold in Ii
quidation OF our foreign Indebtedness.
In the general merchandise markets we
have no particular changes to note. Mer-
chants report moderate trade at prices that
have ruled for some time past.
In grain the movement is light, though in
cars there has been moderate demand during
the week, with no MATERIAL change in prices
Wheat is in light supply. Oats and rye are
steady and in lighter demand.
Speculative operators have been pointing to
the comparatively light arrivals of wheat at
the principal points Of accumulation as in
dicative OF actual scarcity at most of the usual
sources ofsupply, add as consequently favora-
BILE 90 n buoyant market. Most other kinds of
grain have been depre, sed and unsettled in
price, the receipts and offerings gaining no
ticeably ON the requirement. OF buyers foe le-
Ultimate trade purposes, with more or less of
| pressure apparent ON the part of receivers to
| place stock promptly. SOM increase of de-
mand Il 8 been reported In the line of flour,
| wholly OF brands chiefly of city mill product,
| suited 10 the West Indies, on which RATS
have been very wei maintained Ocean grain
fretghts have been quoted hrmer, though re-
| stricted offerings OF berth accommodation N I'd
| a more urgent Inquiry for room, mainly for
British ports. On Monday rates on grain for
Liverpool by ST. am were quoted stronge
| 51Sd bid and 6d asked, rs against the curr~nt
| for othef prominent ports in the Unitrd KING
dom proportiOnateiy advanced figures were
| claimed In the way OF charter contracts, very
| little activity has EN- reported T0nna avail
| bic for this trade hts been less plenty and
rather more sought after, sufficie- tly to give
the advantage Ia ship owners In current negO
| tiations. On Monday, n Norwegian bark wa
taken tO load viii h about 1900 quarters wheat
Pnlladelphit, rates quofed toward the
clos At ~ 3d95, Bi and at Baltimore, s. q pei
| quarter for Cork and orders. A charter WAS re
| pc ted ON Monday of an American brig with
| c srn from Nor oak Or "a French port at Us pei
1 quarter. San r anciscO rep0r,s have beeU of d
| dul market there for the United Kingdom, on