Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1890-10-29

NATIONAL CAPITAL.
The director Of The Mint Issues I
Report on the Silver Question.
CUSTOMS ADMINISTRATION ACT.
Annual Report of Brigadier.Genera
Grierson of the Department
of Arizona.
ESPECIAL DISPATCHES TO THE REcoRD-UsIos.l
NATIONAL CAPITAL.
CUSTOMS ADMINISTRATION ACT.
ESPECIAL DISPATCHES TO THE REcoRD-us1os.l
SILVER PURCHASES.
Director of the Mint, Leech, Throws Som
Light on the Subject,

Director of the Mint, Leech, Throws Some
Light on the Subject.
WASHINGTON, October 2Sth.-Director Leeeh
of the Mint. makes lengthy statement in re
gard to the Treasury purchases of silver bullion
which caused the recent decline in the market
price of silver. He says:
"The Treasury method of purchasing silver
has been criticised 10 these particulars: First
That the large purchases by the Department dc
not include all the silver bought; second-rhai
the London price is used as basis of Govern
ment purchase: third-That the bids to the
Government are on q decimal system, and tend
to favortism."
In regard to the first criticism, he says the
Government purchases silver as it does bonds
and, indeed, any article requ red in eonsid-
cradle quantities, by the tafrer method OF
public competition, the lowest offers being
always accepted, provided they do mol
exceed the highest markes price. For the
benefit of small producers. however. the Super
intendents OF the Minis ere authorized TO pur-
chase small lots at price fixed from day to day
by the Director, corresponding to the market
price. These purchases average possibly half q
million ounces of month.
SecOnd-It is not true that the London price
is used as basis of silver purchases under the
rew law. During the last Administration not
only was the London price the only price used
but the department did not pay the equivalent
ofthe London price, but made a counter offer to
bidders on a theory that silver was worth less
in New York than the London cost of trans
portation and insurance across the water. The
pTSStuI AIullElelIdllUu HIS petu RUNHTHeu
purchase by the New York price At no time
since the passage of the new silver law, indeed
for some months before, has the Treasury felt
itself limited in accepianceS 10 the London
prices.
Third-In regard to Government quotations
being on the decimal basis, one of the critic.
says: "Tle suspicious and significant fact in
regard to the Governments quotations are on a
decimal basis, which is great advantage to
those who may have advanced information in
regard to the price the Government is willing to
pay on given date
The Government has no scale of its own, and
bidders use whatever scale suits them best II
one house happens 10 bid decimal lower than
another, is the Government 70 decline tie lower
bid because of the decimal? The idea of any
seller having advance information" as to the
price the Government will pay is ridiculous and
impossible. II there can be any fairer method
devised for purchasing silver than by actual
competition, it would be difficult TO conceive OF
such method. 1t is method which has been
pursued by the Treasury under all adminlstra-
tious since 1878.
In regard 10 the recent decline in price of sill
yer, the causes which operated to produce it are
apparent. In the first place. the visible stock of
silver in New York has not sensibly decreased,
Notwithstanding the purchase by the Govern
ment of l.2i6. AIS ounces of silver since August
18th, This large and undiminished stock is a
standing menace TO the price OF silver. The
large Western refneries, in hopes of realizing a
large profit held silver for months prior to the
passage of the new law, or deposited it in New
1OIk lDI CtTlluCdtts, dEu Lue TSsulL mas DeeQ
the accumulai ion of visible stock
Of such magnitude as to depreciate 1t. 1t
lis very unfortunate that this stock has been
allowed to accumulate, and especially that GER
tificates were allowed to be issued on it, and
guaranteed by the national banks, and listed on
The Stock Exchange to be dealt IN on margins.
1t has inside a football of silver. to be kicked
around at the pleasure of bulls and bears. In
my judgment there should be law enacted
against dealing in money metals on margins
The usual demand for silver for export has
almost entirely ceased, not only in this case.
but large quantities Of foreign silver have been
shipped to the United States. The imports of
silver from May lst to September 30th of the
present year exceeded the exports by 81 9lS, IT'S,
while for the corresponding period last year the
exports exceeded the imports by IS 9iS 800 This
accounts for the fact that while the Government
purchased an amount equal to the current pro-
duction of our mines. the stock has not Gimin.
ished. During the same period shipments of
silver to India have not sensibly decreased, a.
though latterly they have been below the usual
amount. Hence the supply for India has teen
obtained in Europe, or at least elsewhere than
in the United States. So, too, in regard to the
natural movement of silver to China, Japan
and the Straits from San Francisco. Not one
ounce of silver bullion has been shipped to the
Orient from San Francisco since May 1st OF this
year, while over 100000 worth was shipped
during the same period last year. These facts.
of themselves, are sufficient to account for the
decline which has taken place,
Then, again. all sorts of roOrbacks have been
ttIeRIdputQ iIOIu IUuuOu W llls Country, the
purpose and effect of which was to weaken the
price of silver. 1t is well known that we are in
the midst of most active mining season. Un-
doubtedly the production of silver has been
stimulated by the passage of the new silver law,
but it must be remembered that we are ap.
preaching the period of winter months, when
mining is not SO active, and, moreover, that the
present activity in working the mines naturally
results in more rapidly exhausting their lodes.
So far as my information extends, there have
been no new silver bonanzas discovered, and
aside from the discoveries of valuable silver and
lead properties in Australia l am not aware OF
any large deposits of silver discovered within
The last year or two-certainly none recently
So il is fair assume that the silver product for
any considerable period, unless there are new
discoveries, will not be materially increased by
the present active working of the mines
No sensible person likes to make prophesies
especially on subject which has proven Sc
Elusive as silver, but certainly one who has
made close study of the silver question ought
to find in the facts mentioned sufficient causes
for the recent decline, without seeking for i'm
aginary reasons and cast slurs upon the Treas
ury method of purchases