The morning news. [volume] (Savannah, Ga.) 1887-1900, 1891-10-03

and city deb,s-a consummatioa dsvoutly to Dc
wished.
(e, All railroad bonds deposited must be
secured bv mortgage and none shall be OF
the form known as trust or debenture
bonds.
m No bank shall have more than 20 per
cent. of its bonds on deposit of the issue or
any one state, county, city or railroad.
This provision is intended to protect the Anks
from loss, but is of course not needed for the
security Of the government or the not eholder
lg Whenever any bond upon deposit
under this law shall sell upon any stock exS
change upon which it IS listed for period
of thirty days at an average price Of less
than los the controller Of the currency shall
require it to be replaced by a bond fully
meeting the requirements OF this law.
On Whenever any railroads which was
paying dividends at the time its bonds were
accepted as security for the circulating
notes OF any bank ceases 10 pay regular
dividends, the controller OF the currency
shall require said bank TO substitute other
bonds of the character called for by this
law.
II. Any president, vice president. man
ager, secretary, treasurer, auditor or other
officer of any interstate railroad ANY OF
whose bonds are on deposit under this law
who shall knowingly issue or permit to be
issued any false statement of tue earnings,
be considered guilty of a felony, and be
subject to trial in any court OF the United
States, and if found guilty shall be seu-
fenced to Imprisonment at hard labor for
term of not less than ten nor more than
twenty years, aud may be fined Ia addition,
| at the discretion OF the court, in any sum
not exceeding $lQO.000
The advantages OF this portion OF the law,
| which it is a pity we are compelled 10 limit TO
/ Interstate roads. will not be connne1 10 inc
| banking system, but will give protection to
/ the general public which has long been needed,
and which will tend TO give far or cater stability
| TO American railway investments.
| Ill In lieu OF all other United States
taxes. each banS shall pay in the usual man
ner semi annual tax Of per cent. z per
cent. per annuml upon the average amount
| OF its notes in circulation.
| This viii produce a large revenue for the gov
eminent. and viii tend to prevent the creation
| of new forms Of taxation, which VIII be required
| to meet its present eNtravagant expenditures.
When money on call falls to one half per csut.,
| or even to - per cent. per aanum, this rate of
taxation will Gauss eastern BANKS u deposit law
| full money at Washington for the redemption of
| their notes, and thus imrart an element of
elasticity TO the general circulation. Expert nee
| may prove that tus tax can be still further in
creased, adding TO the income OF the treasury,
and Civ ng still greater hextOllity TO the volume
OF paper money.
". The present United States tax upon
| the circulating II tss Of state banks shall
cease. proviied Ica notes are secured in
| precisely the Same manner as national bauk
| notes by bonds Deposited with the auditor
or treasurer of the state, and provided, also,
that the state in viii h said bank is located
shall guarantee the payment OF Its circllat-
| ing notes. State banks shall pay the same
| taxes on their banks and in the sama man
ner as national banks.
| This would. in every state where there was
| demand for it, restore the state banking 10 its
old condition of usefulness, and would silence
| the now well-founded charge that national
| banks enjoy an exclusive AMI. therefore.
special privi.ege-that of issuing circulating
| notes.
V. The amount Of the notes Issued by any
state bank shall be under the control Of the
state in which 1t is located, and nothing in
| this law shall restrict the circulating notes
OF any state bank TO 30 per cent. of tho cap
ital paid in; but no bank shall issue notes in
excess of 90 per cent of the par value Of the
bonds deposited by it to secure the payment
Of said notes.
This provision will be recogn zed as sound by
most lmpetent bankers aud experience will
probably le ID to its extension ultimately TO ma
| tional banks IL gives the banks also tie power
! promptly TO increase the money in circulation
| when urgently needed such extra supply being
| retired under the influence OF the tax burden
| unless there should continue to be reasonable
| demandfor it; thus having tendency still
| further to develop tiexlbility in our financial
|
| vi. State banks shall not be compelled t.
redeem their NOES anywhere but at their
| own counters.
| Should it be deemed desirable in any state to
| make the circulation OF the notes issued by its
| banks local, and to throw about IL influences
| which would tend to hold them within the
| bounds of the state, this part of the law would
! provide way for doing so.
| VII. All state bank notes issued under
this law to be, like national ank-notes, re-
deemabie in United States legal tender,
coin or notes.
| While we cannot, without further consid-
| Grafton, give an unconditional approval to
Mr.. Harters plan for safe free banking
| system, we do not hesitate to say that it ia
upon this line the argument of the currency
! question must proceed. A basis of credit
having been established, and a safe
currency predicated upon it, nothing
would remain but to keep the basis solid.
The proposed tax of 2 per cent. on circula-
tioa would probably be too heavy; but this
is matter of detail. The plan is presented
in its entirety for the consideration of all
persons interested In live question for
| which @ solution must soon be found.