Savannah morning news. [volume] (Savannah) 1868-1887, 1883-09-27

Correspondence Of the Morning Netcs.
WASHINGTON, Sept. 25.-A question of
considerable Importance to the financial
world is now agitating the minds of the
officials of the Treasury Department. 1t
is more than likely that it will take shane
In the annual report of Comptroller of the
Currency Knox, or in the report which
Secretary FOlger will submit to Congress.
The question referred to involves
the permanency of the national banking
system. 1t was considered year ago by
Comptroller Knox, who saw what was
coming, but has never found place in anv
official document or utterance. Under
the banking laws all national banks be-
fore commencing business have to deposit
in the Treasury Department an equiva-
lent in United States bonds TO
in case of failure. A close syndicate
of banks, with the First National Bank of
New ork at its head owns the majority
of the per cent. bonds. This bond is
peculiarly banking bond, as it does not
mature and cannot be called in until 1907
The syndicate controlling that issue
know this, and have rushed the As
way up to 119. The national banking in
terest Is growing daily. and has been
phenomenaily increased during the
last fiscal year; and during so much
of the present fiscal year as has expired
Most OF the new banks established have
been in the rapidly growing West. They
generally start on small capital-$50, 900
being the figure in the majority of cases
. These banks, just starting in business,
are unable to purchase per cent. bonds
at their advanced premium for purposes
OF deposit In the Treasury to secure their
circulation. So they have been buying 3
per cent. for that use.
THE THREE PER CENTS.
are optional with the government as to
when they shall be called in. The
Treasury has already commenced to re-
deem them, having issued the other day
call for $4,000, 900. just as often as the
money in the Treasury will warrant il.
they will be called in by nstaliments of
$5,0OO,OOO and $l0,000,000. This will en-
crOach, of course upon the deposits made
by national banks to secure their circula-
tiOn. They cannot afford to pay the
high premium demanded for As and
AIS, even if there was sufficient amount
OF bonds OF those denominations to 20
around. There is not. The question then
arises, what is to be done to secure the
permanency of the national banking sys-
tenn, which dOubtless-despite its de-
ticiencies-atfOrds very satisfactory sys-
TEN of currency and is a great benefit to
the business OF the country. Prominent
treasury officials with whom | have
spoken on this subject say that one
of two things will have to be done at the
next session Of Congress. Either there
must be issued bond for banking pur-
poses or there must be an act passed
which will allow national banks to de-
pOsit for the security of their circulation
some class of good security other than Il
government bOnd-say bond of
the State of Georgia. 1t is not
ter will be the course pursued.
1t is generally believed that Congression-
al action will share itself so that there
will be issued a "banking bOHdv bearing
no interest, or, if any, a very small per
annum dividend, which will be used al
most exclusively by the national banks.
Something has cot to be done, Treasury
officials say. The growth of the national
banking system is cOntempOraneous with
the growth of the country. While it
should not be petted or granted
unusual privileges, it would be dam
gerous to business to hamper it or at
tempt to check its growth. 1t is estimated
that the government now holds about
1928, 100000 of bonds owned by national
banks as security for their circulation.
This it will thus be seen is a very impOr-
tant question and one which, will neces-
sarily attract Congressional attention at
the next session. 1t will doubtless form
the basis of chapter in the next annual
report of Secretary FOlger.
THE PRICES REALIZED
by the sale of the old hulks-some
twenty-four in number-which have for
years been encumbering the various navy
yards and naval stations were much
greater than were expected. For every
old hulk the price offered was much
greater than the value at which it had
been appraised by the Naval Board.
talked with a number Of
they expected to make anything out of
their purchases. They all said they did.
The fact appears to be that they will make
very handsome profit. Before bidding
all the vessels were carefully examined
by the men who wanted to buy. They
found plenty of old material in
them to base calculation of
very good profit upon by its
handling. No vessel was bought with a
view to utilizing her as vessel. They
were all purchased as so much old Junk.
Old junk dealers generally average about
profit of 100 per cent. Every bidder
who got vessel was immensely pleased.
as he saw in it much future lucre.
All the vessels bought will be
broken up. Commodore Walker,
of the navy, said to me to-day
in talking on this subject: ''These vessels
should have been sold years ago. 1t would
have saved over 100000 to the govern
ment if they had been sold when they be-
came useless for naval purposes. Con-
gresS has been repeatedly asked to give
the necessary authority for their sale.
but it was only at the last session that it
was granted. What was the con-
sequence. The government has been
paying for years from 5000 to So, 900 an
nually upon each of them to keep them in
even the bad order that they are now in.
1t has been so much money thrown away.
OF course the reason that Congress has
not authorized the sale OF worthless
vessels heretofore has been because of the
suspicion that there was Job lurking
around somewhere. Now that
new navy is being built, and
the present sale has no suspicion of
jObbery about it, hope for better things.
| expect that when an old hulk becomes
an old hulk that authority for its sale will
be granted, and that we will spend no
more millions in keeping what is really
worthless to the SERVICE"
IHAD A SHORT TALK
to-day with Mr.. Davis, Assistant Secre-
tary of State. He said that the De-
partment of State had recently
been importuned in several in
stances to put its finger into the foreign
pie. Various Irish societies in this eoun-
try had requested that the department
take some cOgnizance of the ia 1t that
ODonneH, who is now in prison in
England for killing Carey, the informer
in the Dublin trials, is a citizen of the
United States. Some people had written
that it would be the correct policy for the
government to take a hand in the Ton
quin affairs, There are many who write
that China should be looked after. es-
pecially in view of the Canton
riots. ''The people who write about
IOnquin are, of course, enthusiastic
cranks," said Mr.. Davis. ''The OaDonnelI
and Canton advisers are evidently in
earnest. SO is the State Department. We
have nothing to do with either of those
affairs. They do not concern us in the
least, except as lookers-on. How could
they? 1t will be a long time before this
government is engaged in any foreign
complications The policy that was laid
down by Washington that the United
States should not enter into any entang-
ling foreign alliances or quarreIs is our
policy to-day, and will remain so for many /
years yet to come"
THE SECRETARY Or THE TREASURY.
has under his direct and personal suner-
VISION the original ledger kept bv
deorge Washington, of his personal eX-
penses during the war of the revolution.
1t VIII be remembered that Washington
Saosolutely refused to accept any pay for