The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1884-12-18
Banks and Currency.


: contraction Of the National bank currency
t in consequence of the redemption Of 3 per =
!, cent. bonds. The net decrease Of bank z
circulation during the year ending Nov. 1. .
: was nearly So, 000.00O. 1t is probable that
: this rednctienof circulation will be further
. increased during the coming year BY the 7
e Withdrawal and sale OF A per eentq bonds >
now deposited by the banks in excess ofes
the minimum required BY law as the re- y
duction of the public debt by the payment
OF per cent. bonds. willno doubt incfeassce
the price OF 4'sowing to the reingestnfnt
of trust funds now invested in IS AM II.
for any reason the price advances F5es1
banks will desire to realizes the pfeml4A..s Z
for use in business or divide as prelta
among their shareholders NOD es1Gf
The Comptroller of the Currency asti+ 4
mates that unless legislation shall be silortsp
ly had which will enable the banks to issue 4
currency at q fair profit, circulation wiz
hereafter be reduced at the rate.of at least
$4,000, 900 per annum. The question at
tracted considerable attention, at the. last Z
session Of Congress. and several measures
were brought forward to avert rapid CON-
traction of bank circulation. The, NIT
prominent of these measures were these
introduced by Senators McPherson.o of New :
jersey, and Aldrich, of Rhode Island, and
Representative Pott err, Of New u ork,.. : :
The MCPHERSON bill provides. that apS,.,.
| National banking association shall be, en-
titled to receive from the Comptroller Of
| the Currency circulating notes not exceed
ing in amount the par value Of the bonds
deposited, and that the total amounts of
| notes Issued to any association shall not
! exceed the amount of its paid-in capital
stock. This bill passed the Senate and was
favorably reported to the. House by the
Banking and Currency COMMITTEES. and IL
now upon the calendar Of the House. IN
case it should become a law it would
increase the aggregate circulation Of
National banks upon the basis OF thehs
present deposit of United States bonds
with the Treasurer in trust to theamollps
Of about 52,000,000, and would increase
the profit to the banks oncircniation front
20 to So of per cent. per annuna. No
doubt the increased profits which by this
bill would inure to the banksiwould in-i4
duce those holding lis to- continue to,
hold them, and the profits would probabiy..
be sufficient to induce banks which hold
3's to replace them when called for redemn-s
ton with per cents. The passage of thiss.A
bill seems simple aud feasible measure OLD
relief to the banks, and while it is possible
that the same bill which provided for thee
funding of the high-rate bonds into bonds .
bearing io%er rate Of interest would af-sH
ford more permanent relief The bill OF =
senator Mcpherson is regarded as al ex.
celient measure by the Comptroller. and
would not interfere with any funding bill "a
which might hereafter become & Law. -, 49,
The bill introduced by Senator Aldrich. =
provides for the exchange of 4 per cents 4,
Tor three per cent. bonds having. the same.
lime to rum. Under its provisions the, -
government pays a difference of Is per
cent between the 4 per cent and the SIS.
The bill also provides for the insurance OF
circulation equal in amount to the paI
Salue of the bonds deposited. The add
,ional profits aecruing under this bill if
t should become a law would be from
tbout Of l per cent. to per cent. per
lnnum, according to the bank rates for
oans on the per cent bonds which re-
'lace the fours and it is believed that this
would be permanent measure of relief
% the banks. t
The bill introduced by Mr.. Potter in
he House provides for the refunding of
he 8, 4, and AZ per cent bonds into 81 Der
'ent, payment at same time and to be re-
leened in the same manner as those for
which they are exchanged. The bin also
,rovides Tor the reduction of the tax upon =
REGULATION based upon the proposed q per
ent bonds of one-half of l per cent per-
nnum, while the tax upon circulated <
lase'i upon all other classes of United States u.
,oEdS, remains at ! per cent Aannum u
Under this bill the provisions for obtains ~
ng currency on the bonds deposited ~
you'd be the same as under the present
aw, namely, 9Oper cent of the par Yalusse
4 the bonds deposited. The bill, $50 farles
$ the funding of the high rate bonds is
imilar to the Aldrich bill, the latter
providing for the refunding of the foirrs
My. eeas ~
1t is believed by many that the provisi0h9
Il the Potter bill, relating to the purchase
Il the bonds by the Secretary oftfe Treas
Try, would be somewhat difficult to carry
nut, and it is a.qnestion whether it would
e constitutional for Congress to make any
III the tax imposed on the
based OH different classes Of
United States bonds as it must be rernem-
cred that the tax is on the circulation.
nd not on the bonds. If the bill. with
ONE notifications, should become a&lawi
% doubt the additional profits which
Tould accrue to the bonds under its opera
ion. would be permanent benefit. and
ssist in preventing the contraction of the.
7ils' So
1t is now claimed, and not without
aason, that Hon. S. ]. Randall elected
fov. Cleveland. 1t was his appearance in
Jew York that reconciled the protective
Democrats to his candidacy. and induced s
many to vote for him, who, otherwise, i.
you'd not have done so. Had he been 50
,iven over to the free-traders, he would ss
lave been defeated by a large majority F.
New York. Yet the. 81
lotions.