Morning journal and courier., 1881-03-12
News by Telegraph FROM ALL QUARTERS. THE BANK PROBLEM. A Decision from the Treas
 ury Department. POLICY OF THE ADMINISTRATION A Strict Adherence to Past
 Precedents. ORGANIZATION OF THE COMMITTEES. Further Delay Secured by the
 Republicans.
POLICY OF THE ADMINISTRATION,
ORGANIZATION OF THE COMMITTEES

~-- Republicans.
 THE NATIONAL CAPITAL. The Bank ProbIem-A Decision from the Treasury Department-Past Precedents to be FoIlovved-Legal Tenders Return ed to Banks-PrOceedingsi in the Senate -Independent Davis Still Wants to be Independent-The Orga nization Of Conn mfttees Not Yet Effected.
 WASHINGTON, March 1.-The following letter embraces the decision of the Secretary of the Treasury on the application of the na- tional banks to be allowed to withdraw their legal tenders deposited for the retirement of circulation.
 TREASURY DEpARra1ENr, OFFICE OF THE sEoRE- TARY.
 Washington, D. G., March II.
 To the President of the Merc1Gnts' National Ba7ak, CleUeEaaad, Otio:
 Sir: am in receipt of your letter of the 9th instant, stating that your bank had during the previous week deposited with the assistant Treasurer at New York $1SO,OO0 in legal tenders with view of retiring that amount of it's circulating notes, that the bonds to se- cure the same amounting to $2OO. .OOO had
  to New York, and that the bank now desires to return them to the Treasurer of the United States and receive back the above amount of legal tender notes. As the action taken in this case would establish rule by which the department would necessarily be governed in regard to similar requests from other banks, some delay in answering your letter has oc- cured. It seems that since the 18th ult. about $19, ,OOO, 900 of legal tenders have been deposited for purpose like that mentioned by you. Of this amount one million was re- turned by the Treasurer. The request having been received before any redemption of notes had been made or security bonds delivered, in such cases the transaction being incom- plete the department had clearly right to return the notes, as had been done. Of the remaining amount, about SIS, 1000, 900, secu- rity bonds therefor have either been surren- dered or redemptions against the amount de- posted have already been made, and the transactions have been so far completed that it has been decided that the precedents of the department in similar cases should be ad- hered to and no return of legal tenders be made In this connection it should be stated that no apprehension of unfavorable results need be entertained in this matter. Since the 25th ult the department has paid out for bonds purchased about $6, ,500,O00, and is to-day paying out a like amount $5, ,OOO,O0. In addition to these payments there has been advanced from the Treasury since the 1st of March to. meet the payment of arrearages of pensions the amount of ST. 583, ,844. 33, and on the first proximo there will fall due of interest more than $7, ,O00,- 900, and there are on hand of incomplete national bank notes which can be issued at once to the banks the amount of $4, 1000, GOO, which in the aggregate, it would be observed, will take an amount from the Treasury large ly in excess of the amount of legal tender notes which has been deposited by the banks sir he J11f yYb oh ia no ed should be returned. Letters have been received asking if the identical United States bonds held as security for circulating notes which were recently withdrawn by the tional banks can be re-deposited without transfers. This request will be granted if the bond bears no assignment except that of the Treasurer of the United States to the bank returning it. Very respectfully,
 H. F. FRENCH, Acting Secretary.
 The above letter, though signed by Acting Secretary French, is in fact an official act of Secretary Windom and was agreed upon at the regular Cabinet meeting held. today The decision embraced herein establishes the policy of the administration on all questions affected thereby. The discussion was reach ed after careful study of the question by Secretary Windom and conferences with Treasurer Gilfl1an and assistant secretaries
 In commenting upon the decision of the Secretary of the Treasury made public to- day regarding the application of the national banks to withdraw their legal tenders and re- deposit bonds Treasurer Gillian said to- night that the decision involved no new fea- lures, but was simply @ declaration that the department would continue what has hereto fore been it's practice in such cases He be- ieved, however, that ~one of the benefits to be derived by the action of the Secretary would be that it would make it difficult for any future combination of banks to be formed for the purpose of withdrawing bonds and affecting the money market. The decision simply carried out the existing laws, and had another course been adopted it would have rendered it possible for the banks by concert of action to inflate and contract<the currency for purposes of specu- lation any time they felt disposed, thus lodg- ing in the banks a power dangerous to the commercial world and liable to be abused or exercised at a moment when it would result most disastrously to the business interests of the country and to the government.
 Referring to the decision of Secretary Win dom on the bank question, Comptroller Knox says there is no occasion for any uneasiness in consequence of the decision. The matter could not in any event seriously, if at all, af feet the money market. The furry in Wall street in anticipation of this decision was without foundation. The banks which de-
 
 ent of one another. It was not concerted &C., tion. Some of these banks do not wish to continue circulation and some do. MT. Knox says he does not believe that in sixty days $S, 900 oOO of the $17, 1000, ,OO0 of legal tenders affected by Secretary Windoms decision will be in circulation. The work of the depart ment will be finished in half that time, but delay will be caused by the banks, which will only put them out as they have occasion. The cost of printing and putting these notes in circulation will not exceed $50, OO0 In the case of banks involved in the present decis- ion the cost of redeeming their notes will be paid by the government MT. Knox, while not satisfied with the decision, feels that it is not much of an affair after all.
 Wilbourne Colquitt, brother of Governor Colquitt of Georgia, in fight tonight at the National Hotel with A. D. Melee of South Carolina and Gancee Martin of Mississippi, cut the two latter in 8 dangerous manner. Martin is thought to be dangerously wound ed. The cause of the quarrel was a woman. Colquitt escaped, but will no doubt be ar rested tonight.
 President Garfield will give dinner party tomorrow night at Willard's to the members of his Cabinet.
 Postmaster General James vacated his DO. sition as postmaster at New York on March and became Postmaster General on the 7th inst His accounts as postmaster at New York were rendered to Sixth Auditor McGrew on the morning of the Sth inst. They were at once audited, adjusted and settled and found to be correct to cent, and his sure- ties have been notified that their responsibn- ity has ceased. This prompt settlement of the accounts of an office the receipts of which nearly equal one-ninth of the entire postal revenue of the government is unpre- cedented in the history of the department. Postmaster General James was serenaded last evening, and addresses complimenting his ad- ministration of the business of the New York postofiee were made
 A delegation from Illinois and Wisconsin are here with protest against the retention of an associate judge of the Supreme Court outside of Wisconsin, Illinois and Indiana. That circuit has now no representation on the supreme bench.
 The President today sent number of nominations of postmasters to the Senate.
 Secretary Lincoln entered on his duties to- day. A delegation of citizens called on him this morning and congratulated him on his elevation to the head of the War department. D;.aotrr ,f fI,a Mint RI1rchard made the iUtro-