New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-10-05
QUESTIONS OF FINANCE.
VIEWS OF TWO TREASURY OFFICERS.
PROPOSITIONS TO REDUCE THE RATE OF NTEREs,
ON THE PUBLIC DEBT, WITH ADVANTAGE TO ALE
CONCERNED.
lBY TELEGRAPH TO THE rRrBuNE.l

lBY TELEGRAPH TO THE TRtBUNEl
WASHINGTON, Oct 4.-It is expected that
both the Secretary OF the Treasury and tue Controller Of
the Currency in their forthcoming reports will discuss
various propositions looking reduction OF the
or interest on the public DEBT and more permanent
base Of security for National Bank note circulation OF
the $33oOo0oO0 OF per cents outstanding, the banks
hold twOthirds, and. while Controller Knox Is Of the
opinion that not many Of the per held by them
Will be among the first to be called the desirabity
not TO necessity OF having permanent form
OF security basis for bank circulation fully realized
By hun. Secretary FOlger, 1t is understood regarls with
some favor the proposition TO take up tie per cents
and replace them with ongterm bonds bearing lower
rate OF interest Controller Knox OF the opinion that
r would be feasible refund the cents by issuing
per cents redeemabe say 1907, offering
change them for per cents, the Government to pay
premium Of say IS per cent 10 the holders.
PUBLISHED VIEWS OF THE CONTROLLER.
In discussing this proposition IN his last annual report
Mr. Knox SAID: "rhe new 8 per cent bonds issued
would themselves bear small premium and it Is believed
that tue holders of per cents would consent 10 such
exchange accom- panied by offer OF not than
10 per cent prenuIn The amount OF the premium upon
this class OF bonds, say $700,000COO. now out-
standing 10 per cent, would be Sl05, ,0O0,0 000 and
this premium could be pads the bonds surrendered
for exchange from the surplus Govern
ment, thus effect, reducing the Oebt Of the Govern
menl $l05.0O0,000, by prepayment Of interest which
must be paid at greater each year until their una
turity.
"The benefits of this plan, both to the holder
and tho Government, apparent. The holders
would receive. the shape Of 10 per cent
premium upon the bonds portion OF telr interest in
advance, which would be available for loans at rates
greatly exceeding the borrowing power OF the Govern
ment, when Is now less tdan per cent. The Govern
would be enabled by this OF its surplus to save
a Of the interest, which otherwise IL would DO
compelled TO pay hereafter"
MRK KNOX STILL FAVURS HIS FORMER PLAN.
In conversation with TRIBUNE correspondent yestsr.
day MI KuOx spoke ayorsDly Of this plan, which ne
thinks circumstances would be advantageous
TO the Government ana the bOndnoders. Leaving
OF the calculation the worth tO the Government or
the use money required for advance payments OK
interest in the premium which would otherSse
bocunr due quarterly intervals during the neKs
years. the transaction far the Governs
meut Is concerned would result follows: Premium on
S73s 900 cent GOnds atl5 7llO7OOOOO
Interest Oh 900 at per cent for twenyiour
years. S53l $4,000, or a total Of S642,OGOO0O "a
against S7Us 10000 interest the sanr pruypdi IOr
tie same time At per Tus would leave balance
Of SG6 10000 favor Of tue Goyernnen to N ot the
loss Of the VI interest ddVanced IN TIE Ori o pro
MUM Tie transaction would give the CIV rnment tIs
further sdVaut.g Of au opportunity 70 Apply tae sur
Securities bearing the highest rate and having ths
Longest tune ~ run.
ADVANTAGES TO BONDHOLDERs.
advantage Instead interest at per cent muJntns
to sos OOO they would receive interest at per
cent amounting 10 $53I. 100000, plus Sll0,7OO,0OO
| for premium plus interest on the premi"ni'
| wrch al 3 per cent would amount 70 S791O4OOO.
making a total OF S72l 1000 or Sl32s4OOO mors
than they would realize by holding their per cents
! Controller KuOx Is Of the opinion tnat tne NdtonAe
! bapNs trust companies, sa'lngs banks, etc. would
rid, agree 10 surrender their Per cents and aeetps
z urr cents Oh such erms, AMI nc 10 fdtlct lucAhed
Ia believe that at lrass nYeoeyenths Of the per eeu
| ...lH h.. nn rod pLcldlge, "
adDpred would enable the HattJna! banks 10 sdyshte
gor tne per nt, which subject 20 cali ana Tor ne
AZ Der ceuS which will become dreulahe e'sht years
hence por cents having twenty -four years l" run
| SENATOR ALDRICH FAvORs THE PLAf.
| To a TRIBUNE correspondent today Mr. A'ar en- Oh
Rhode lslaud who is member OF the Finance Commit
LOO OF tuo Senate expressed approval OF the general
features Of the plan as outlined and said he Thought
| IL eurrr.ly practicable lie regards It as highly
! nportaut that something be doEe 3y TUG
| iaCOmiug Congress 10 place tuc N1'ondl
| bauk clrculatiOu upon more pegm@uelt
blsis He does regard with favor any OF the pfop1~
itons TO authorize the NaOHs banks TO deposit ftato
bonds or any of security than GC'eruucns
Douds as basis ru their oircustOL. IL ls GIdcrst0Si
Inat secretary Fussr AMI Controller EuoA hold lAs
| views TINS subject.