New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-09-12
NLLTER-NOTE LNELIY[ON

Last week the Secretary of the Treasury
inflated the paper currency again, how much
he probably is not aware. Under his orders,
So 900 in silver certificates were issued to
banks here, S1,2Sj,OOO were sent to interior
points, and the issue of SIG 1000 more at 81.
LOUIS and other cities where there il an Assist
ant Treasurer was also ordered, at the appllca-
ton of the banks here. This does not seem to
he an altogether safe or desirable arrange
ment In order to force one particular kind of
paper money into use, the Treasury virtually
agrees TO transport that kind OF money to dis
tant points at its own cost. At the desire of
banks here, it orders an issue Of Sl,2Cj,OOO
silver certificates to their correspondents ut St.
Louis let us say and then is obliged to order
81 $50 600 of the certificates shipped ththor
to be issued. The shipment is wholly at public
cost and risk. The only conceivable adyan-
taae is to the banks of the Western city. which
are thu, enabled to escape all the cost OF NOV
ing their money from New-York.
There are several disadvantages involved by
this course, to which, it is possible, Secretary
Folger has not had time to give sufficient at
tention. The GIst is that the only small barrier
that has heretofore checked drain Of money
from this centre is removed. 1t makes no
difference now whether the rate of exchange
is such that it is profitable to ship gold or
rency. The money can he moved at public
cost and the Western banks can therefore
afford TO draw it whether there is a cent to he
gained by the transfer or not. But the silver
certificates dO not come back as easily. Ihey
cannot be deposited at st. Louis to be issued
over again on Geographic orders at New Ork,
but must FIRST 20 into the Custom House, "A slow
process in an interior city of small imports, or
be Transported at private expense and FISK rs
express. The practical tendency Is 70 Increase
and intensity the drain upon the monetary
centre. In any time of disturbance or panic,
this may become a very serious matter indeed.
There will he disadvantage to the Treasury
also. The issue of certificates under the new
ruling, is not governed at all by the demand
for one form OF currency or another; they are
issued only because in that way money can be
transported at public risk and cost. Being
issued regardless OF any demand for them IN
use, the certificates will the more readily be-
come so plenty at any interior point that they
cannot he employed. Then they may be sold
at IA small discount. sufficient at least To cover
the cost OF getting them to New ork, where
they can be turued into gold through payment
of duties. But il small depreciation would
suffice to cause such certificates 10 be cmpucd
into the Custom House almost to the exclusion
OF any other kind of money.
At present it is 10 Inconvenience to the
Urea my to swell its gold balance by virtually
borrowing money on silver notes. Bat there
will he some Inconvenience when the payment
In gold of $50, OO0,OO of these notes Is de
manded Then the Treasury reserve OF gold
will be suddenly depleted and the effect upon
public confidence may be altogether unsatisiac-
tory If the banks lind themselves loaded mp
with silver notes, which are tending 10 dcprcci-
a;e, and can be freely used at par only through
The Custom House, they will desire larger re
serves of gold, aud may at any time begin TO
send in lcgal-tendcrs for redemption. If the
course adopted involves no advantage, but
some risk, both to the Treasury and TO tho
business community, why should II be pur-
sued ?