The Emporia weekly news. [volume] (Emporia, Kan.) 1881-1889, 1886-10-21
~ O0antry,s Currency.

Gals state that an erroneous impressions
prevails as to the operation Of the bond
cal1, and the general condition OF the
treasury. They maintain that the treas
ury is not only not Gripping commercial
and financial transactions by forced con-
traction Of the currency, but In point Of
fact there has been AZ ; result OF treasury
operations within the last two months
and more, an actual net average monthly
increase In the outstanding circulation OF
not far from 90 600, OO0. How this re-
suit is reached Is shown in the following
statement by one Of the leading officials:
He said IL is Q mistake to say thst the
lawful money deposited with the treasury
against bank notes retired Ia pure loss
70 the market. This amount Of money.
In point OF fact, Is . mere credit. Ii is .
sum Of money that has been deposited
as q mere credit. The process is this:
The bonds of bank are called. There
Is 10 per cent In excess OF the bonds.
which goes 20 the bank as cash, the
balance, 80 per cent, Is paid over to the
treasury for account OF the re-
demption OF the notes Of that bank.
The treasurer does not take q
step to secure the redemption Of these
notes. They come in on an average Of
s30, 900 to $50 600 daily, but this amount
is more than compensated by the oiheT
standing out of the United States treas
ury in excess of the amount Of national
bank notes retired is, in round numbers,
from SIO,0O0,QO0 to SI2 060, goo. The
notes OF the national banks remain out
standing and the money is used in gene
raj business. Il goes to the general ben
eft. On August last there were S97,-
zoe, 600 silver unused In the treasury.
On October Is, although there had been
an increase OF coinage. there were In the
treasury only $50 ,000 900 Of silver I'M
used. This shows that there has been
something like an increase of S12, OO0,-
600 in actual circulation In that time.
The banks do not pay in any money in
the operation Of the calheg in Of the
cancelled bonds. The bonds are here in
the treasury to the credit of the banks
as security for their circulating
notes. When they are cancelled the
| banks return the receipts and the cash is
remirted 10 them for the excess Of 10 per
cent, and the balance is p'6ced to the
credit Of the bank on account Of the cir
culating notes destroyed. The notes are
not called in, they simply come in by de-
grees by reason Of their mutllated con-
dition. The bank fund on August was
| $50, $50 600. On October Is it was $40 =
$50, 600. Nearly all of that money il still
outstanding, and will be outstanding IN
| til II IS so mutilated that it cannot be used
as money, and when 1t il returned It will
not be because it has been cancelled. bu
because IL Is unfit for circulation.
The amount of silver coin August
was 1926, 1874 600; on October Is the
amount was $241 $40 900. The outs,and.
ing silver certificates on August 2 were
S54, 234, 600, and on October Is &59, SOL =
coo The United S ;ates treasury has pu
into circulation $500, OCO silver dollarI
and $13 600 600 in silver certificates il
that period, g total of 91S 100000. From
this is to be deducted a $40 900 nationa
bank notes Will drawn, making q tots
net increase Of circulation of $13, $50, 600
To this should be added the increase
in the amount Of gold certificates. Tit
amount of gold certificates In circulation
August WAS S77, sos, 347. The amour
Of gold cirtficates in circulation on Oct.
ober IL was $S5 SAG, coo. The balanct
on August / was $7S, 900. On Oct.
ober Is was S61 ,490, eco. There hai
therefore gone out Of the treasury and
into circulation about 90 5OO, 000 in tina
period. There are 81 $1,000 silver dol
lars in the treasury, and the net balanci
is S6I 100000. Therefore the nstiona
bank fund. which amounts to $79, 00O,
600, has been used to the extent of TIT
of the difference, which Is S26, 600, 900
The silver goes into the general fund
The amount of the silver balance in thu
treasury is $S7 600, GOO, consequently IL
order to pay the banks IL the govern
ments accounts should be 1iquidated to.
day the balance would be liquidated By
the payment of $36, 000,0 900 silver to thu
| national hanks.
tits therefore clear that this nAtions
bank note money is not idle, unused II
the treasury, and 1t is also clear that TIT
processes of the treasury are towards
an increase in the circulating
medium rather than the re-.
verse, It is also quite true tina
the speculation of New York can Absorb
all the dollars that can be put out by thS
treasury. The small bills are going ou
very rapidly, faster than any have ever
done before, and every effort has beer
made to prevent forced contraction.
One Of the crest troubles in the situG-
ton, of course, is that In times like this
the volume of the circulation in New
| York does not increase except through
government expenditure. Exchange Il
all against the city. But 1t should bs
understood that no money passes in thil
entire transaction with national banks
No contraction can possibly take place
on sccount of the national banks. Thil
is really q process of redemption o.
United States debts in silver certificates
through the medium of redemption o.
national bank notes, which are redeem
ed by the issue of these certificates. Tit
net average increase in the circulation il
not far from Sc 500 600 per month, not
wi ,hstsnding the retirement OF the na.
tional bank circulation, and the business
of the country is consuming all thil
money.