Evening star. [volume] (Washington, D.C.) 1854-1972, 1891-04-27
MONEY OF THE GOVERNMENT.
What the Director Of the Mint Has TO Say
on the Subject.
An AvArLABLE CASH BALANCE IN THE TREASURY
OF S250, 600, 000-HE SHOWS HOW THIS CAN BE
so-So ANTICIPATION OF A SHORTAGE


OF S25o, o00, 000-HE SHOWS now THIS CAN BE
so-No ANTICIPATION OF A SHORTAGE
A STAR reporter today asked Director Of the
Mint Leech for an explanation of the state
ment credited to him that there was an availa-
BILE cash balance of ESQ, 900 900 in the treasury
''Is it So" The STAR asked, ''that there is
such balance2''
'Yes," Mr.. Leech replied. az hold that
the Treasury owns some $3.50, O00, 900 of hard
cash available for any legitimate expenses The
money in the treasury, which amounted to
$751;, O00, 900 on the LIST of this month, consists
Of two classes: that which the government holds
as trustee and that which it owns. 1t cannot
consist of any other kind Of money The
gold and silver certificates, amounting (includ-
ing currency certificates) to S493, 000, 900 rep
resent trust money; that is, the coin has been
deposited by individuals and the government
has issued a certificate to pay back the same
upon demand.
Possibly the fund Of 100000 placed with
the treasury by national banks for keeping
their currency in good condition is trust
money; but as Congress just ordered the money
placed here by national banks for the retire.
ment OF their circulation to be covered into the
general balance of the treasury il is difficult to
conceive why this money is any more sacred.
The 500 900 900 in gold, purchased by the sale
OF bonds for resumption purposes. was always
included as portion Of the available balance
In the treasury" prior to that date by all Of
the secretaries OF the treasury.
The remainder of the money in the treasury.
some ESQ, 900 600 is money which belongs to
the government absolutely as the Treasury
building belongs to it. Prior to 1885 the avail
able balance in the treasury was always shown
as the amount Of money which actually belong
to the government
NOT LIABILITY.
Mr.. Sherman never set this apart as ssliabil-
ity" or any special reserve. The law does not
say it shall, and there is reason why it should
be. Nor is there any reason why the new legal
tender notes Issued in the purchase Of silver
bullion are any more a current liability against
the cash In the treasury than the old greenbacks
are. They are the same class of legal-tender
money, only a better money, and the
credit OF the government would be Just as much
injured II the treasury should fail to redeem
one OF these notes or any other obligation in
gold as 1t would be if it should fail to redeem
one of the greenbacks in gold upon demand.
these notes are not silver money as people
generally suppose. They are issued in the first
instance In the purchase of silver bullion, but
as they come back in the treasury are reissued
for all purposes, and are simply and purely
a new issce of the old greenback.
NO INDICATION OF SHORTAGE
The fact that the Secretary is anxious to con-
vert all the assets of the government into the
most available form of money is no indication
that there is any shortage in the treasury
funds So far as the coinage of the trade dol
Lar bullion is concerned the coinage of
that bullion into silver dollars was ordered by
act OF the last Congress, and it is the intention
TO coin 1t into dollars after the LIST Of July,
whether the treasury is low or full Of money
SO. too, In regard to the recoinage of the
subsidiary silver coins; Congress made an ap-
preparation Of $50 600 to pay the loss on such
recoinage, and just as soon as we get some new
design for our coins it is my intention to set
the minis at work on such recoinage as far as
the appropriation will extend. But neither OF
these matters has anything to do with reliev-
ing any shortage in the treasury.
whether the Secretary should decide to ex-
tend the AZ per cent bonds at the rate Of per
cent would simply be business proposition az
to whether it would be more profitable for the
government to use its money in buying bonds
bearing per cent interest at the current rate.
problem which the Secretary in his wisdom
Will doubtless solve at the proper time.
CAUSE OF THE RECENT ORDER.
But imagine that the recent order suspend
ing the purchase of bonds and the policy Of the
Secretary in regard to the ~ bonds arises
more from the considerations of the fall money
market than from any present or anticipated
lack of funds.
As matter of fact some SIS, SOC, 900 of the
AZ bonds are in the treasury as security for
national bank notes and the treasury would
only have to provide 10 per cent of the cash
required to redeem them, as the banks them
selves would have to provide the rest Of
the money, unless they should decide
to purchase fours to replace the AIS, which
at the present price is not very probable. 1t
must be remembered that when the banks nav
this money to redeem their notes the money
paid in, under recent act of Congress, becomes
immediately an available asset Of the govern
ment, while the national bank notes themselves
would come in very slowly for redemption.
As have said, the large surplus in the treas
ury has been used in the purchase of interest
bearing bonds to the extent of S267 600. 900
since the advent of President Harrison's adj
ministration, and necessarily the available bal
ance would be lower than formerly.