Evening star. [volume] (Washington, D.C.) 1854-1972, 1893-04-18
THE DISAPPEARING GOLD.
How the Treasury omcials May Meet the
Situation.

MOTIFS issrrp N PAYMENT FOR SILVER MAY Br
RKpEENEp IN suvER-THE LAW ON IHE
susJEcr-oSK WAY 10 CHECK THE OUTFLOW
OF ooLD-ooSrIDEScE ExPREssEp BY Of
rIcIAIs.
The gold situation today is considered to be
much easier than IL was yesterday. Treasury
officials are even moro confident than they were
twenty-fours hours ago. and in the minds OF all
tho Impression Las become stronger that It
may not be necessary for the Secretary
to take any action which will change the pres
cnt policy Of the department This feel
ing was said to be due 70 the fact that
tho announcement was practically made that
the government would only as . Inst re-
source turn 20 the issuance Of bonds. This
firm and determined position OF Mr.. Carlisle
has, they Nay, already had its beneficial effect
and SO soon as 1t becomes known that the
Secretary of the Treasury has seriously con-
sidered the advisAbili;y Of stopping tine pay
ment OF gold coin for the treasury notes
issued under the act OF July IL 1850. The situa-
tion will present very different phase. and the
shipment Of gold, which is looked upon as a
means 70. forcing the administration to issue
bonds, will come TO AN end.
AT THE CABINET MEETING TODAY.
The cabinet meeting today was devoted TO
some extent TO the consideration OF the
financial condition, and many believe that
the Secretary OF the Treasury will be upheld
IN his advice TO stop for the present the
payment IL gold OF the treasury notes.
Under the silver act OF 1850 the government
was compelled TO purchase each month
4.5Oo.OOO ounces OF silver, and at the same
time Issue notes for the bullion received
1hsre is at present outstanding OF
these notes Sl3O.cOO,0 900, and they are
being constantly redeemed in gold at the
New York subtressury. The redemption in
gold Of these notes has been a matter of accom-
modation on the part of the Treasury Depart
men: Us the law gives the Secretary Of the Treas
ury the discretion as to whether they will be
redeemed in gold or silver. Now that the gold
balance has been reduced the Secretary Of the
Treasury is considering the advisability Of
using his discretion and paying these notes in
silver.
WHAT THE LAW SAYS.
The second section of the silver act reads o.
follows: Sec. 2. That the treasury notes issued
In accordance with the provisions of this act
shall be redeemsble demand in coin at the
treasury OF the United States or al the Office of
any assistant treasurer of the United States and
when 80 redeemed may be reissued, but no
greater or less amount OF such
notes shall be outstanding at any time
than ths cast Of silver bullion and
the standard silver dollars coined therefrom
then held in the treasury purchased by such
notes. and such treasury notes shall be legal
tender In payment OF all debts public and pri-
vate, except where otherwise expressly stipu-
lated IN the contract, and snail be receivable for
customs, taxes and all public dues and
when received may be reissued; and such
notes, when neld by any national banking asso-
citation, may be counted part Of its lawful
reserve. That upon demand of the holder of
any treasury notes herein provided for the Sec
retary OF the Treasury shall, under such resu-
lations as he may prescribe, redeem such notes
in gold or silver coin ct his discretion, it
being the established policy of the United
States to main tain the two me tails on q parity
with each other upon the present legal ratio, or
such ratio as may be provided by law.
WHAT THE EFFECT WOULD BE.
If the Secretary determines to take advantage
of the discretion given him by the Law it will be
very difficult matter for New York brokers to
obtain the gold for shipment. as the stoppage
OF the payment on the gold certificates and
the treasury notes would leave them
with II; lie upon which gold could be obtained.
The suotressury IN New YORK at the end of
each month makes a report to the depart-
mcnt here showing the amount of treasury
noses that have been redeemed ia gold In
the reports of the ways and means COM
nit!ee on the condition of the treasury up TO
January 81, 1898, table is given, which
shows that the subtressury redeemed the
following amounts OF treasury notes in gold
each month since June. 1882: July,
IS, ,l0s,So0: August, s5,ol9. 600; September.
SL.759.0O0; October, 224.z00; November.
uGry, 1898. Si.i3s 800. or total of S2l. .l36. 500
Of treasury noes redeemed in gold for the
past seven months mentioned. For February
and March il is said that the re-
demption has averaged S4,00o.oO0 each month.
From this it will be seen that a con-
government and at the same time the inability
of brokers to obtain gold for these notes will
cut of one OF their most ample means Of OBJ
tanning them.
SILVER FORCING GOLD OUT.
1t is said that this policy was an inevitable
one. as the continued redemption of these notes
in gold was bound to result in the driving out
of all the gold. For it is apparent that
the condition was such that gold was
being paid out through the medium
OF the treasury notes for the silver bullion sold
As former treasury official explained it to
STAR reporter the principal is the same as
with water with layer or surface
OF oil. If one should continue to
pour in water the oil would finally be forced
out. In this the water represents the
silver and the oil the geld and the continual
purchase Of the white metal and the giving out
for il of gold has brought about this result"
There is feeling among some men who have
been prominent in financial circles tha. shoDld