The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1878-03-27

in the purchase for six per cent. bonds it
would be an aid to resumption.
Senator Bayard-What would YOU do with
the proceeds of the sale of these bonds?
Secretary Sherman would use them in
purchase of outstanding bonds. All / would
have to do would be to pay the difference
between greenbacks and gold, but that would
be only paying one per cent. premium /
have right to call in bonds, and l could
use currency in their payment by giving
$101 for the bond in currency the difference
between currency and gold at the present
time.
Senator Bayard-You can sell your 4 per
cent bonds at par in currency and you can
use the-currency ano redeem a higher rate
of bond.
Senator Jones-How would that aid re-
sumption?
Secretary Sherman-By repeating discrim-
ination that is now made against the legal
tender note In the payment of bonds. The
bond issued would be a coin bond.
large number of questions were asked
by several members of the committee and
the secretary in the course of his answers
said there was one thing he would recon-
mend, namely: He would on the LIST of Oc-
tobea next receive United States notes in
payment for duties, and yet provide for the
interest on the bonds in coin. In other
words he would assume on the 1st of 0cto-
Der next that our motifs were as good as gold
aud silver, and would receive them as such.
You gentlemen will feel your way
clear to allow my receiving United States
notes in payment of bonds, and will make 1t
clear that l will not be compelled to take all
United States that come in after the LIST of
January next and If you think, under the
circumstances, | would be strong enough to
receive these notes on the LIST of October,
should be willing to guarantee the resump-
ton. i think for the United States to go
backward over all of this long, weary agony
and struggle toward resumption would be
I sign OF national weakness, and do the nation
/ harm, do our credit harm and bring injury
/ upon US all.
/ The Chairman-What effect would a re-
/ peal os the resumption act have upon the
relations of currency, legal tenders, and on
coin, gold and silver? Would not repeal
B of the resumption act cause fall of paper
! below gold and silver?.
Secretary Sherman-I have 10 doubt of
that. / think repeal of the resumption act
would at once cause a widening between
coin and paper money, depending entirely
upon the confidence the people at large
would have in the ultimate redemption of
paper; but don't want to enter upon this
delicate ground.
Among other questions asked was the fol-
lowing by Senator Ferry: You state that
/ with $40, 10000 gold reserve, you would be
willing to hold $500, 900, 600 as part of the
b. currency, and meet resumption on that
basis. Now desire to ask If, with the con-
traction as it is going on, it would be any
obstacle to resumption even il the outstand-
ing circulation should be 1920 O00, 900 on the
. LIST of January neXtY'
Secretary Sherman-I think the 500, 600, 900
would be provided for by the increase of
bank notes.
Senator Ferry-Without any direct fur
Their contraction than under the present
resumption act.
Secretary Sherman-The present resump
ton act would be sufficient. | would not
by myself provide for and direct the con-
traction OF currency except what is done
/ under the act.
The chairman-Don't you believe there
will be an expansion come upon us natural
/ ly, or by the action o. the treasury depart
ment on the LIST of January will there not be
more money IN actual circulation after that
period?
Secretary Sherman-1 think and hope so.
Senator FeTry-Would not that produce
healthier condition.
Secretary Sherman-No, sir
Senator Bayard-What would be the effect,
in your opinion, if the declaration that $780,
600 900 of treasury notes might be issued as
a minimum and as a maximum, to be sup
ported by rentatiOn by law OF SlOO,OOO,OOO
of gold in the treasury?
Secretary Shenandoah would be bene-
fetal, because L think the fear about that
$500, 000,0 900 would he overcome.
Senator Kennan-And your opinion is
that the authority to reissue legal tender
notes should he expressly given by law.
Senator Sherman-I think that the au-
thority to reissue unquestoned and
undoubted would take away the fears of
ali classes of people First those in
favor of imitation, who do not want
greenbacks Destroyed, then in the eastern
states where they think We ought TO retire
yreenbacks and issue hank notes instead
believe that we are bound under the existing
law to pay the whole of the S3OO,O0O,OOO,
and that we are not prepared to do.
Senator Allison-In other words, you think
We can not come to and maintain specie pay
ments without the power to resume?
Secretary Sherman-I do not think we can.