Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1890-10-29
JEECH TO THE FRONT.
THE DIRECTOR or THE MINT ON
PURCHASE or SILVER.
us Defends Existing Methods-He Talks
Like n Little Man for the Present
Administration.
fBy telegraph to the Dispa.ch.I

Leech, Director OF the Mint, makes the
following statement in regard to the
Treasury purchases OF silver bullion and
the causes of the recent decline in the
market price of silver
The Treasury method of purchasing
silver has been criticised in these par
ticulars First, that large purchases by
the department do not include all the
silver bought; second, that the London
nrice ia used as q basis OF Government
purchases third, that bids to the Gov
eminent are on the decimal system and
tend to favortism.
In regard to the first criticism, may
saw that the Government purchases sill
! yer as it does bonds. or indeed any srti-
Gle required in considerable quantities,
by public competition, the lowest offers
always being accepted provided they do
not exceed the highest market prices.
For the benefit OF small producers, how
ever. who would otherwise be obliged to
trade through middle men, the superin-
tendents of minis are authorized to pur.
chase small lots at price, fixed from
day to day by the Director OF the Mint,
corresponding to the market price OF
silver. These purchases average posi-
bly half million ounces month, and
are reported to the Treasury weekly.
Second. 1t is not true that the Lon
don price has been used az the basis Of sill
yer purchases under the new law. During
the last Administration not only was the
London price the only price used in
making purchases but the department
did not pay the equivalent OF the Lon
don price, as the records OF the Mint
Bureau will show, but made counter Of
fers to bidders on the theory that silver
was worth less in New York than in
London by the cost of transportation and
| insurance across the water. The present
Administration has been governed in its
purchases by New York prices and BIAS
| paid at times in excess OF the highest
price at which certificates sold on that
same day. OF course the Government
| accepts the lowest bids for the sale of
silver, but it does not reject bid for the
reason that it exceeds the London price,
| and il there are no lower bids will ac-
cept any bid within the highest New
York prices At no time since the pas
sage of the new silver law-indeed, since
some months before-has the Treasury
felt itself limited in its acceptHnces to
the London price.
Third. In regard to the Government
quotations being on decimal basis, one
of our critics is made to say: "A suspi-
cious and significant fact in regard to the
Governments purchases OF late is that
houses offering large lots have uuderbid
by the hundreth part Of q cent. . r
The Governments quotations are on n
decimal basis, which is great adyan-
tage to those who may have advance in
formation in regard to the price the Gov
eminent is willing to pay on q given
| date,
| "ADvAHCE INFORMATION.
Now in regard to this it may be snid
| that the Government has no scale OF its
own, and bidders use whatever scale
suits them best. Any person who has
silver may ofler il at any price he sees
| fit. If one house happens to bid a deci-
nal lower than the other is the Govern
ment to decline the lower bid because OF
| the decimal e? The idea Of any seller
having advance information as to the
price the Government will pay
is ridiculous and impossible. Offers
for the sale OF silver are all
made by telegraph within n few
minutes of l o'clock and the Treasury
has no idea of what it will pay until all
the offers are opened, its acceptances
being governed entirely by the offers.
These offers are entered IN book and
are passed on by the Director of the
Mint. who recommends which ones shall
be accepted or rejected, and the book IS
then taken to the Secretary of the Urea
sury and each offer is passed upon
separately and personally by him
and the bidders notified by telegraph
OF the acceptance or rejection OF their
bids. The whole business does not occupy
fifteen minutes. The uniform practice,
as the records which are open to public
inspection will show, is to accept the
lowest bids, the only question FOR the
Director and the Secretary to determine
being how much they will buy on given
day and how favorable the offers are as
compared with tho market price. If
there can be any fairer method devised
for purchasing silver than by public
competition it would be difficult TO con-
ceive OF such a method. 1t is the
method which has been pursued by the
| Treasury under all Administrations since
1873.
cAUsKs OF THE DECLINE IN PRICE.
In regard to the recent decline in the
price of silver the causes which have OPP
Grated to produce it are so apparent that
they need only be stated that their full
force may be measured. In the first
place, the visible stock OF silver in New
York has not sensibly decreased, not
withstanding the purchase by the Gov
eminent of 12,27G,478 ounces of silver
since August 18th.
This large and undiminished stock
ia standing menace to the price Of
silver, and has of itself been sufficient
to shake public confidence in silver. II
the large western refineries had allowed
their product to take its usual course
that is, offered il for sale to the Govern
ment at current prices and sold the re-
mainder abroad-this stock would not
have accumulated, but in hopes OF retail
ing larger profit they held their silver
for months prior TO the passage Of the
new law, or deposited it In New York
for certificates, and the result
has been an accumulation of the
visible stock of such magnitude as
to depreciate the price. 1t is very un-
fortunate that this stock was allowed to
accumulate and especially that certif-
Gates were allowed TO be issued on it,
guaranteed by the national banks and
listed on the Stock Exchange TO he dealt
in on margins like other stocks 1t has
made a foot ball of silver, to be kicked
around at the pleasure of the bulls and
bears. In my judgment there should be
a law enacted against dealing in money
metals on margins.
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