Goldsboro weekly argus. [volume] (Goldsboro, N.C.) 1885-1909, 1892-05-19
BY JOHN r. MORRIS,


has there been such pn alarming surplus,
not of money, but Of financial statesmen.
Here, in CUR own county Of Wayne, even
| in the streets of our little civ, Goldsboro,
we are in peril of being run over and
| trampled by both urban and rural states
men whG3take hold of financial problems
with an audaciousness that would shame
| the unwise man precipitately seeking the
acquaintance and cOmpanionship of
wildcat. OF these, there are those who un-
heSitatlngly commend or condemn none
| tary policies, prove or disprove banking
| and treasury statistics, While dispOsing of
| the most occult propositions of finance
with the delight of entire satisfaction to
| themselves. Students of finance, without
| motives for preferment or beyond the point
| of desire for acquisition of knowledge, for
| intelligent guidance in delving for facts,
| arrangement of statistics in logical Sc
quence, formation of opinion and quest
| for the completest degree of moral and
political certainty CT conviction, listen to
| these so-called statesmen with a patience
| not altogether inseparable from the recon-
Cling qualities of sustaining grace. TC
ward not few of new-era statesman, the
| man of Thought, books, observation and
| experience, while preserving the exterior
| of respectful auditor and repressing in
clination to radically dissent, can not,
withal, suppress the inward, but unex-
pressed conviction, that the intelligence OF
| these gentlemen would discredit the
knowledge and ability of an Eskimo who
| may be able to distinguish the quality and
| worth of the hide and fur of an Arctic
seal from the skin and fins of dried cod
| fish.
There is no more serious aspect Of ma
terial affairs than the cease!ess agitation of
| the silver question. Not satisfied with the
| law of July, 1904 compromise in the
interest of wise onservatism-making it
peremptory on the secretary of the Treas
ury to purchase 4, 100000 ounces of silver
and issue treasury notes and coin certiti-
| Gates on the purchase value, the heretical
silver advocates, i'll advocacy Of a less hon
| est plan, have prostituted speech until we
are inundated by vernacular flood of dis
gushing, clamorous garrulity; a travesty on
| freedom of speech.
Of course the issue of the national banks
is inadequate. Nor is any single system
adequate to supply a volume of money
| equalling the average need and distin-
guished by quality of expansion for spec
| ial or suddenly created conditions.
Much has been written and spoken to
prove that the national banking system is
| inelastic. There is a charming, almost
| rythmic resonance in the word elastic and
its negative inelastic. l believe that pedan
| tic writers and speakers have rung the
changes on these words because of the
probable inference in mind of hearer or
reader that they were technically equipped,
and, withal, rare embellishers of English
sentences. The ablest writing on current
problems of finance that l have read is
from the pen of Prof. Quarels. the distin-
guished political economist Of Washington
Lee University But he, too, indulges the
sinelastic dogma concerning our ma
tional banking supply, though he presents
interesting and instructing data. Had he
assimilated his facts, his pen would have
been wary to elude the careful stress
which he impresses on this misunderstood
phase of the system.
| Under the law of February 25, 1868, no
association Of persons may commence
national bank until said association has
1 deposited in the treasury of the United
| States interest bearing bonds to the
amount of one-third its capital. Under
the same law the government issues and
signs currency in the name of the bank,
for 80 per cent. of the market value Of
| these bon Is; providing, however, that 80
per cent. of such value shall not represent
more than the par value of the stocks de-
posted. If the issue may not be readily
expanded or rendered 'elastic," there is,
at worst, but one-third of the capital rep
resented by the issue of bank notes There
fire, under this law the "inelastic" theory
rest of the capital, two-thirds Oh the entire
sum, is Of currency common in the purse
of any man, or in any private bank; and
may be augmented by deposits, sustained
by acquisition ofloans, or contracted by ac-
commodation to borrowers; no less t1exi-
J bic ror elastic than the funds of private
banks or bankers. But the theorists of
the ssinelastic" doctrine will now insist
: that the law fixes the limit of the aggre-
| 10 10 ic tn
nate even minimum whole, and that for
!. ten wears the circulation of these banks
has declined descending from $315,000,-
900 in October 1882, to $123, 900, 900 in Oc-
, tober 1890.
In reply / will repeat that no single
system is adequate to furnish the needful
! volume of currency. Our volume OF
money is an output of greenbacks, coinage
of gold and 81 yer of standard weight and
: quality, supplemented by suS Ssidiary coins
of reduced weight but standard fineness
smaller denominations, nickles and pen.
: MES, of base metal, and the national bank
issue.
The last, the national bank issue, may
be lessened, but, strangely, not contracted
, and lessened only so far as the response
5 bility of the banks is involved. The GOV
I, ernment may become the owner instead
l of security holder Of the bonds, agains
i which the notes were originally emitted
I 1t is no longer profitable to national banks
s without most extraordinary deal in the
f purchase of bonds may be eonsummated
to remain banks of issue. Interest bearing
J bonds are so high that, when we remember
the 80 per cent. issue may not be in exces
of the par value of the bonds, we readily
r perceive how deeply this tax may go init
:, | the assets of a new bank. Therefore
banks which purchased bonds at a low
figure have found it more profitable K