New-York tribune., 1886-07-30
EnNHN ND COLD.

The brief statement 10y the Treasury, show
ing the amount of Three per cent bonds held ~
trust for banks rs a basis Of circulation. defines
the prolslbc change N bank circulation within
the next two or three Years. These bond- are tn
only ones that can hc Icdo ocmDd until 1891.
About $40, 900 Of them remain to be 10
deemed. and Of thc-c the banks hold security
ioI circulation : UGOOO,0OO The amount oi
circulation based on these bonds Is about
500, 900 600. but a part ui tie hank- would
doubtless purchase fouT or iour AMI a half PEI
cent bonds to deposit III place OF those fc
deemed in order to retain at least tlt uin.mua
circulation. On this suppoSiuon 1t I, estimated
that about s. ,OOO,OOO might b, thus pun
chased, and that the actual refinement Of eli
cula,Ion might be about S7j,0oO,ouN
Thee ng,ucs have al important b,Hing on
the surplus lceoution which WAS passed 10y the
House and l. pending IN the Senate The sap
poitcis Of uhat measure nave only one plol--
tat the opposition 10 ii comes from the bank
But the rcquIcmcns OF the sinking fund alone
sntI>t inevitably retire all The outstanding tire"
pol cents within about three years, and the
Necessary disposition Of the suiplu, revenue Il
IL continues ns large H. il now u, must reIulr
a more rapid retirement The pending Ic>olu
ton. as it came from the House, would compel
the retirement of all the three per cents III loul
teen months. A. respects the banks. the que
ton is simply ths: They hold s. OG.oOo,oO0
Of the bonds, of which about $50. .OOO, 900
ycmly NUT be retired for the sinking fund
without any new legislation. The Morrison
resolution would only deprive than of the acuIty
profits Of circulation on about S1O.OOO,OOO
bonds during part OF two yolIs or lees. The
circulation affected is about TG3 600 900. and
the profits are not | per cent, so that the In
tclcst OF the banks IN the matter Is really in
significant In any event, they must lose thl-
basis of circulation 80 soon that II Is matter
Of small consequence whether the retirement
extends over most of three years or is finished
i'm fourteen months. The real impOi lancc of
the Issue l., with respect 10 the condition OF tn,
Treasury. As to circulation, that is so gIcitll
redundant already that Il retirement of the o,t-
mated S7j,OOO.OOO, or even OF the entire
500, 900 OOO would do no harm. Certificate,
and coin in ample amount could be added f.
the circulation if nc,diul in place of the bank
notes. But the effects rs TO the Treasury can
not be SO hopefully contemplated.
The prctcncc of silver men in the House il
that the redemption oil = 20 bOo,oOO bonds HclI
by banks would only add S9J,o0O,OOO to the
amount now deposited in bust funds for the
redemption Of bank notes, 50 that only the Ic-
naming S3i,OOO,OOO would he taken from th'
Treasury III gold for the redemption Of bond
This plea Ignores the tact that the tIu,t fund,
are already swcllcd to anOIc than :. 100000
by the Ii ~ deposits Of the last year, which Will
involve within the next yc;r great retirement
of bank notes. The holders of the notes.-the
people and not the banks which have already
surrendered ciIcdlatOn-will demand from the
Treasury gold instead OF legal tenders, If they
have any reason 10 fear silver payments. The
y, nding resolution would give them reason
enough. Between the $40, ,OOO,OO now de
pcsl,d. and tine %9j,OOO,OOO which would be-
deposited under the resolution within foul-
teen months. the amount Of notes redeemed and
of gold consequently drawn from the 'lIc.S.lIy
M cht easily bc more than the entire rcservc|
now held.
But if it we've less than half the rcScrvc,
most dsastrou, consequences might be piccipi
tatcd. Ful there aIc ako the legal tenders held
by the banks, IN amount now about T9l ,OOO, 900
If the banks mc To be informed that silver
only is 70 bc lett III The tilIst funds Oh the