New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-06-04
HAS CARLISLE NEW PLANSf
A QUESTION CONCERNING LEGAL TENDERS.
BANKERS CONDEMN A REPORTED NEW POLICY
TO ACQUIRE GOLD-STOcKS RALLY

ON SHORTS
new and far from rcassuring element may be
interjectcd into the financial situation by pub
| lcation in commercial newspaper Of this city
respecting new scheme Of the Secretary OF tho
Treasury to replenIsh the gold balance, now he
| Ing heavily depleted by the European demand.
According to this statement Secretary Carlisle
has reached the opinion that he has authority
under Section 300 of the Revised Statutes OF
the United States to purchase gold coin by the
issue of new legal-tender notes II is also D.
clarcd that the Secretary has practically ~.
solved to this power if the gold reserve drops
beyond the point of safety special Washing
ton dispatch to the Foreign and Domestic News
Company, a Wall Street news agency, yesterday
corrobcrated the assertions of the newspaper cor
respondent.
The section under which Mr.. Carlisle Is al
legged TO have discovered his new power is the law
Of March IL 1862, reading az follows: The
Secretary of the Treasury of the United States
may purchase coin with any Of the bonds or notes
of the United States, authorized by law, at such
rates and upon such terms a. he may deem most
advantageous to the public interest" The Treas
ury Department is said to hold that the act Of
1878, which forbade the further cancellation and
retirement of United States notes, did not debS1
a future reissue Of notes up to the original amount
3, 1863. This maximum issue reached in
the Civil War; but under Secretary OF the Treas
ury Hugh McCuoch the amount outstanding was
reduced to an even 1886, 100000. Under Secre-
tary richardson's administration OF the treasury
Department the amount of the issue was raised
in 1873 to SSs?, 100000 The retirement Of
these notes, begun under the Resumption act Of
1915. reduced the outstanding amount to $780,
esl,Ol6, when further cancellations were stopped
by the act of 1873, Congress stepping In In ~
sponsc 10 the camor of " infationists'
WHAT BANKERS HAVE THOUGHT FOR YEARS.
There has been uniform belief among bank.
crs since that time that the limit Of $346,0OO,00O
barred any future increase in these notes. The
act of 1862 which is quoted in support Of the al
legged theory of the Treasury Department. referred
TO old 40 notes Of the Government. the United
States legal tender or greenback.' not then be-
inc in existence. II Mr.. Carlise's views are cor
rectly reported. he has made discovery even
more potent for evil than his former exploitation
Of the idea that he could pay the Treasury notes
of 1890 in silver alone. Bank presidents yester-
day were reluctant TO discuss the report OF Mr.
Carlise's new policy, declaring their BELIEF thas
it had no foundation They said that it was I'M
possible TO credit the Secretary with such iai'
lacios view. with the folly OF entertaining any
purpose 70 put such policy into operation. 10
was generally agreed that a new issue OF unl'ed
States notes would instantly put gold to pre-
MUM.
The president Of a downtown National panRs
a Democrat who is well acquainted with severss
Of tbe Administration officers. said This is news
10 me- and hope it is not true. as have never
entertained doubt that it was illegal TO increase
the outstanding amount Of legal tenders hXed III
the law of 1873 Ny view of the effect OF suoh
action by the Secretary may be best expressed
wien | say that hold il not to be the function
of Government 10 issue paper money. VI COURSE
a. a practical matter must deal as best we can
with the paper already issued. But any increase
in the amount only would aggravate the hnanciai
evils we are suffering from already
IT WOULD ACCOMPLISH ONLY HARM.
Another prominent bank president said: Inc
course credited TO Mr. Carlisle would accomplish
only harm. We already are initiating the currency
S4,5OO,OOO month. and additional imitation wouio
only add fuel to the cOnfiagration now raging
Suppose that the Treasury should be able to puy
$50, ,oOO, 900 gold with the same amount OF new
legal-tcnders. Suppose the adverse trade palance
continues and exporters take out $25,000.oO0
gold paying for it with Treasury notes Ihen
there would he S25,OO0,OOO gold left and $5Os-
600. 900 of new paper money would be outstand.
ing The effect of any such action by the Gov.
ernment would add TO the Generalization OF con.
idcnce."
A man prominent in financial circles said: Al
its hest this plan would simply mean that the
Government would buy gold with legal-tendefs
and then proceed to pay 1t out on the presents-
ton of the same lega-tenders. But suppose the
Government should enter the market as buyer
of gold in competition with the business commt-
nifty which needs the metal in it's operations.
What premium would gold go to? The business
world impcratively needs the metal. nut hero
would be a competitor with an unlimited issue OF
paper notes. The premium could not be pre-
dicted."
COURSE OF THE STOCK MARKET
The Wall Street markets opened yesterday under
,he Influence of continued unfavorabe advices
from Chicago and fresh liquidation in American
securities in London, where another failure oo-
cured The early trading, was attended 'hy
weakness and lower prices, but in the last hour
of the short session modest rally occurred be-
cause OF the closing up of professional snort
accounts Louisville and Nashville opened doyn
| Is per cert at o.. but rallied to 62 81 st.
Paul and Omaha lost l.? per cent net; Chicago
and Northwestern closed shade lower, and
ar h'gn sa ane'H at T' n? Northern Pacific preferred de.
clinrd 10 80 IA and after a rally to 33 So
showed a net loss of l.: per cent The recent
no unfavorabe developments respecting the
Willard plan to fund the floating debt, but |:
ascribcd to the effect OF Tile March financial
statement That statement showed deficit after
interest rentals, etc, Of S33s,5?2, and for the
nine months of the fiscal year the deficit on 6xed
charges was SiA,o41., The remainder Of the
gains, and >cw-iork and New England and
General Electric scored exceptional advances OF
| 3-4 and IA per cent respectively. The
market closed in ignorance or the failure
of the large note-brokerage firm Of
n Co., of Chicago, and operators had
given little attention to the reports from Wash
ington that Secretary Carlisle had decided that
he possessed power to issue United States notes
with which Ia buy gold
THE GOLD MOVEMENT.
The foreign exchange market closed firm at the
highest quotations Of the week. The sharp de-
cline in discount notes in London has exerted no
influence favorable to check to the gold move
ment, for siNty-day bills have advanced as the
London money market declined. II is hoped that
the sharp break in the price of wheat may stimu.
late exports and thereby increase the supply Of