The Providence news. (Providence [R.I.]) 1891-1906, 1893-08-04

NEW YORK. Aug. 4--The overshadow-
Ing question yesterday In financial circles
was the scarcity Of currency. At many
banks 1t was admitted that cash payments
for large checks over the counter have
been suspended for some days, except in
cases where 1t was known the actual cash
was necessary. In other words. it was
said the banks used discrimination, and
where 1t was thought the demand for ac-
tual cash currency" was made for the
purpose of boarding, the bank insisted
upon certified check being taken. The
clearing house committee issued &, ,000, 900
more loan certificates
In the very general collapse Of the ma
chinery Of domestic exchange the collec-
tion OF drafts on bonds in other towns and
cities has been managed on
An Unusual System.
Ordinarily, when New York bank de-
positor turns in check drawn to his
order on an out-oftown bank, the New
York bank RENTS to its own correspond
ent In the same place for collection or else
sends direct to the bank drawn upon. In
both cases out-of-town banks have either
delayed in remitting or else have remitted
in New York exchange, charging up TO the
New York bank the cost Of exchange.
The city banks have therefore resorted, In
unusually large measure Of late, to direct
collection through the express companies
which make speciality of presenting
drafts direct at distant points, drawing
out the money and shipping 1t to New
York. The cost OF this transaction has
for a long time been materially below
the rate charged for interior exchange.
Many Curious Incidents
are related by bankers as to the workings
of such collections. Some outside banks
have taken pains to pay such drafts in in
convenient currency, notably standard
silver dollars One case is mentioned of a
country bank on which draft of several
thousand dollars was collected by express.
In the money returned were several hum
dred dollars In gold, S400 in standard sill
yer dollars and 5000 i'm subsidiary coin, al
most entirely dimes, with liberal sprink-
ling of Canadian pieces.
Frederick ID. Tappen, president of the
Gallatin National bank and chairman OF
the clearing house loan committee, said
that the cry about the scarcity Of currency
would be all over by the end of the
week, by which time the first of the gold
importations would be here. The receipt
of $40, 100000 Of gold. the amount now on
the way, would, Mr.. Tappen said, effect
ually put stop to it. Mr.. Tappen said
he did not know anything about pre-
MUM being offered for currency.
So far as the Gallatin bank was con-
cerned it had shovelled out the cash with
out discriminating and er-
Would Continue tn Do So.
He believed one or two banks ns town
were little short of currency, but IL was
probable that arrangements would mt once
be made to relieve their necessities in that
respect.
Another prominent bank president, dis
cussing the scarcely of currency, said:
"The situation now is very different from
what it was In 1873. Then, when cash pay
ments were suspended. all the banks of
this city on the worst day had only 5000, 900
of cash all told, and now they have
sl0O,000,000 in cash, and suspension
of cash payments Is impossible. The
present scarcity Of currency is due to
boarding. There arc vast sums In the
vaults OF savings banks throughout the
country ~