The Iola register. [volume] (Iola, Allen County, Kansas) 1875-1902, 1893-04-28
SOLVING THE GOLD PROBLEM.
The Secretary OF the Treasury SuSpends
the Payment of Gold to Redeem Silver
Certificates Heading on Wall Street.

The Secretary OF the Treasury Suspends
the Payment of Gold to Redeem Silver
Certificates Heading on Wall street.
WASHINGTON, April 19.-The gold sit
uation is considered to be easier.
Treasury officials are more confident
than they were twenty-four hours ago,
and in the minds of all the impression
has become stronger that it may not be
necessary for the secretary to take any
action which will change the present
policy of the department This feeling
was said to be due to the fact that
the announcement has practically been
made that the government will, only
as last resource, turn to the issu-
ance of bonds. This firm and deter
mined proposition of Mr.. Carlisle has al
ready had its beneficial effect, and so
soon as it becomes known that the sec
! rotary of the treasury has seriously con-
sidered the advisability of stopping the
payment of gold coin for the treasury
notes issued under act of July II, 1890,
the situation will present very differ
ent phase. and the shipment of gold,
which is looked upon as Il means of
forcing the administration to issue
bonds will come to an end
The cabinet meeting yesterday was
devoted. to some extent, to conSidera-
ton of the financial situation, and it is
| stated that the secretary of the treas
ury will be upheld in his advice to stop
for the present the payment in gold of
the treasury notes. Under the silver
act of 1890 the government is compelled
70 .l,.,C Oh A S0O nQN
of silver. and at the same time issue
notes for the bullion received.
There is at present outstanding
of these notes $3.50, 100000, and
they are being constantly redeemed
in gold ut the New York sub-treasury.
The redemption in gold of these notes
has been a matter of accommodation
on the part OF the treasury department,
as the law gives the secretary of the
treasury the discretion as to whether
they will be redeemed in gold or silver.
Now that the gold balance has been re-
| duced. the secretary of the treasury is
| considering the ACCESSIBILITY of using
his discretion and paying these notes
in silver. The second section of the
silver act reads as follows:
Sec. That the treasury notes issued in nc
cordance with the provisions of this act shall be
redeema5le Oh demand in coin at the treasury Of
the United STATES or arthe office OF am assist
ant treasurer Of the United States and wher 50
redeemed may be reiSSued but no greater or
less amount Of such notes shall be outstanding
at any time than the cost 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 a legal tender in payment OF all
debts, IUSlic and private except where
otherwise expressly stipulated in the contract,
and shall he receivable for customs. taxes and
all public dues. and when so received may be
reissued; and such notes. when held by any na-
tiOn1l banking association, NAV be counted as
4 part OF its lawful reserve; that upon demand
OF the holder Of any treasury notes herein pro-
vided for, the secretary of the treasury shall,
under such regulations as he NAV prescribe re-
deem such notes in gold or silver coin ut mis-
discretion, il being the established policy Of the
United States 10 maintain the two metals on
parity with each other upon the present legal
ratio, or such ratio as may be provided by law.
If the secretary determines to take
advantage of the discretion given him
by law. it will be a more difficult mat
ter 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 less upon which gold could be OBJ
tanned. The sub-treasury in New York
at the end of each month makes re-
port to the department here. showing
the amount of treasury notes that have
been redeemed in gold. in the reports
of the ways and means committee on
the condition of the treasury up to
January 81, 1898, table is given which
shows that the sub-treasury has re-
deemed the following amounts of treas
ury notes in gold each month since
June, 1892:
July, los. 900: August, 1000; ,,
September, 81, T59, 900; October, 1924, 200;
November, s22O,O0O December, 81 $780, |
500, and January, 1898, 81, ABS, 900, or |
total of s2l, 1876. 500 of treasury notes re-
deemed in gold for the past seven |
months mentioned. For February and |
March it is said the redemption has |
averaged $4,000, 900 each month. From !
this it will be seen that large amount !
of gold can be saved to the government |
and at the same time the inability |
of brokers to obtain gold for these notes
will cut off one of their most ample |
means of obtaining them, as it is said
that this class of notes has been largely |
presented by New York bankers in ex-
change for gold.
1t is said that the continued redemp-
ton of these notes in gold is 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
reporter, the principle is the same as
though one had glass partially filed
with water with layer or surface of
oil. IF one would continue to pour in
water the oil would finally be forced
out In this case the water represents
the silver and the oil the gold, and the
continual purchase of the white metal
and the giving out of it for gold has
brought about this result.