The Athena press. [volume] (Athena, Umatilla County, Or.) 18??-1942, 1893-07-21
Athena, Oregon, July 2Ist, 1898.
THE CURRENCY QUESTION

THE CURRENCY QUESTION
IBy z. $. Hichborn. cashier First Nationa
Bank, Augusta, Me-, in American Banker.
In these days, when so man,
people are demanding more none,
and claiming that an increase II
the circulating medium will serve
to lessen the burdens of trade anc
commerce, restore confidence aud
veivify our tagging industries, it is
well that we consider the means
suggested to bring about that re-
suit and the character of the cur
rency to be supplied. I assume
for the purpose of this discussion
(although it is a much debated
question: that an increase in the
circulating medium would prove
advantageous provided, however,
quality be not sacrificed to guam
tity. How, then, shall it be fur
nished?
There are to-day ten different
kinds of money in circulation in
this country, scarcely any two of
which are of the same quality or
subject to the same law as to re-
demption. 1t is not necessary that
| discuss them in detail; the i'm
portant issue is gold, silver, the
certificates based on the coin
age thereof, United States notes,
commonly called greenbacks, and
National bank notes.
1t is not my purpose, in this ar
ticle, TO enter into discussion of
the merits and demerits of all these
varieties Of money, / merely stop.
in passing, to express my uncom.
promising and emphatic opposite n
to the unlimited coinage of silver.
with its fluctuating value, and the
issue of the certificates based on
such coinage. | cannot regard as
wise or as excusable, the use of
SILVER as circulating medium upon
any other than a fixed international
basis. Of greater concern than the
iacR Of confidence, and confidence
varies inversely and in compound
ratio, as the volume of unstable
currency increases. | come, then.
to the consideration of the oues-
ton which | desire to present. to
wit; the National bank notes.
Excepting, of course, gold and
gold certificates and the greenbaeks
(which latter We're issued only un.
der pressure of great civil war
and whose farther use or issue is
not IN accord with settled princi.
pies of finance) l believe the Ma.
tional bank bills to be the hest
circulating medium this country
has ever had. They combine con- |
venlence and elasticity with abso. |
iute and unquestioned security
anu their issue costs neither the |
or "the people" one |
dollar Of expense.
Why not, then, expunge from
the bank act some of its, under ex-
lsting conditions, unwise and un.
just restrictions, and encourage
the issue of more bills? It is n
TACT that to-day nearly all Of the
banks are holding the minimum Of
bonds required by law and hence
issuing q very limited amount of
circulation; indeed many of them
issue none at all. Why is this?
simply because there is practically
no profit in doing so, for these rea.
sons; The law provides that up-
on deposit of Government bonds
With the Treasurer Of the United
States, to be held by him in trust
y security for the bills, a bank
may issue bills-that is, its own
aotes-to an amount elualling 90
per cent, of the par value of the
bonds 50 deposited. But, in order
% redeem the mutilated bills, It is
provided that they may be presen-
ed to the Treasurer for that pur-
pose, and as redemption fund,
le retains 5 per cent, of the
mount issued, equal to A per
'ent, the par Of the bonds; so that
he banks really issue but S5S
yer cent. Upon this circulation
ne government imposes tax of
. Of per cent. semi-annually,
naking a triile better than | per
ent. annually; there is the sx-
ense of asserting and redeemine ,