The Redwood gazette. [volume] (Redwood Falls, Minn.) 1873-1940, 1878-04-04
The Financial Views Of the Secretary
OF the Treasury.

secretary -Ot-the-1reaSury Sherman
recently had a consultation with the
Finance Committee of the United States
Senate, in which he took occasion to
give his views at considerable length
upon what he believed to be the proper
course to be pursued in regard to tinan.
clal affairs. and especially the d,ity of
Congress in respect to specie rcsuinp-
ton.
Mr.. Sherman rrefaccd his remarks by the
| statement that the Treasury held in cold and
silver. free from all liabilities, the sum eff
ST., Us, S6O.5i, and added: We have in proc
ess OF preparation for resumption reduced the
volume of United States notes. The amount
was 3S2,o0O,OOO at the time of the passage of
the Resumption act, and the amount now is
$34S.6lS,Us4 Again. the amount of our stand
| ing bank notes has been reduced. On Dee
81, 1919, the amount was s,46, $50;
on Dec 81, 1s', s32l.6'aa,a)5, and on
Feb. Is, 1873, the amount of bank-notcs
outstanding was 1921 $3.50, 99.. But the amount
| OF bank notes of banks in existcncenot in pro-
cess OF liquidation was 500 5l0475, and the
dlnerepce between these two sums is the
amount of the notes of banks in process of
iiquldation, although the notes are in crcula-
ton, Vet an equal amount of Greenhachs are
| in the treasury as special deposit to redeem
them. If you count the whole erccnbacks as
outstanding there would be $.299,0oOOGO of
National Bank notes. Then it must be remem-
bered that the United States notes have been
in circulation since 1862 and the bank-notes
since 1854, and that large sums are lost or de-
strOyed.
He estimated that the aggregate of bank
notes and greenbacks and fractional-currency
outstanding at that time, deducting for these
lost or destroyed and those held for Outstand-
ing bank-notes of banks in process of liquida-
ton, was about $ti43, OOOOOj. He said, speak
ing of preparations for resumption, .'we have
already practically abolished the premium on
gold. We have reduced the amount of United
States notes and the amount of National Bank
notes outstanding. We have paid Off practi-
cally, the fractional-currency, and now we
have very remarkable circumstance in our
favor. The balance of trade is in our favor to
the amount of Sl6O,OO0,OOO year, bringing
silver and gold and bonds back to us. In the
last three years the balance of trade in our
favor has been s4l4, 034. $685.
To a number of questions asked, Sec'y Sher-
man replied:
1--WE have got both gold and silver from
England, but we must do it, as Lincoln said,
unbeknownst to them. 1t must come by the
bring by any artificial movement a large sum
of gold to this country would create alarm.
All last summer ard fall the accumulation
wasssfrom S5,0JOOOO to $S,0OO,OOO each month.
Some of that came from our own mines, and
some of it from abroad, but we accumulated
WlIuOuO dIIS pOSSAulC lDJuIH !" any uOuN
Now, / do express my opinion officially and
personally, that for the reasons have given
we can resume on the LIST of January next, I'M
der the basis of the existing law"
The Secretary stated that the passage Of
the Silver bill had not created all the bad re-
suits he had anticipated, although it had
stOppcdrefunding operations, and also stopped
the accumulation of coin. Another bad eff
feet was that it had caused the return of
bonds held in Europe: Referring to its un-
doubted good effects, Mr.. Sherman said:
"1n the first place, the Silver bill satisfied a
strong public demand for bi-metallic money,
and that demand is no doubt largely sections
al. No doubt there is difference of onin-
ion between the West and South and East on
this subject nut the desire for the remoneti-
cation of silver was almost universal. In a
Government like ours it is always good to
obey the popular current, and that has been
dOEe, think, by the passage of the Silver
bill. Resumption can be maintained more
easily upon double standard than
upon single standard. The bulky character
of silver would prevent payments in it, while
gold. being more portable, would he more
freely demanded, and think resumption can
be maintained with a less amount of silver
than of gold alone. l think it can be MAIN
tained better upon a bi-metallic or alternative
standard than upon a single, and with less ac-
emulation of gold. In this way the rmon e.
tization of silver would rather aid resumption.
The bonds that have been returned from Eu-
rope have been readily absorbed-remarkably
| SO. The recent returns in New York show
that the amount of bonds absorbed in this
country Is at least a million and quarter a
| day. This shows the confidence of the peo-
pie in our securities and their rapid absorb
ton will tend to check the European scare.
The demand for bonds extends to the
West and to the banks. have no doubt we
can sell the ~ per cents, and think within
month we can sell all we want of 4-per-cent.
bonds to carry out the Resumption law, for
would not accumulate more than 5000, 600 a
| north, and that largely in silver and gold
bullion. There is no special necessity to force
the bond market in order to maintain resump-
ton. Wenow have from ST. 600, 900 to 800, OOO,
| 600 on hand, and every one can measure how
much more will be necessary to maintain re-
sumption. II the sale of bonds was ever so
| free, would not accumulate more than Sc, :
beyond that should be applied for refunding
| arey-cent. bonds"
Upon being asked what could he done to aid
him in specie resumption, Sherman said:
II am very willing to answer that, although
think it is legislative question. think
that yon can aid resumption very much if you
viii allow me to receive United State notes in
payment of bonds If I could sell 4-per-cent.
bonds for currency and then reissue the cur
rclcy in purchase of 6-per-cent. bonds it
would be an aid to resumption. All l would
have to do would be to pay the difference be.
only he paying per cent. premium.
hare right to call bonds, and l could
use currency in their payment by giving
lO1 for the bonds in currency, the difference
between currency and gold at the present time.
think another aid to resumption is also very
desirable. If you could make it clear by leg
islative enactment that the Secretary has pow.
or to reissue United States notes after the first
of January to the amount of $500, OOO, 900, il
would relieve the people and relieve the whole
country from the fear which they have that
the greenback currency is to be entirely de-
stroyed. If we are to attempt on the first
of January to paw off all these greenbacks
! as presented and to destroy them, have
my doubts Of our ability. 1 think
the law is perfectly clear now as to the power
to reissue up to $500, Cox, 600 of currency. An
other thing would recommend: would, on
the LIST Of October next, receive United States
notes in payment for duties, and yet provide
|; for interest on the bonds in coin. In other
| words, would assume, on the LIST of Octobcr
next, that our notes were as good as gold an
, silver, and would receive them as SUCH"
He said he did not believe that specie rav.
Ments could be maintained without power 10
.nSee,so 1Irfkod CHo<oo uo<ns