Warren sheaf. [volume] (Warren, Marshall County, Minn.) 1880-current, 1894-12-06

resumption act OF 1875, and pursuant to its pro.
visions bonds were issued drawing interest at
Inc rate OF per cent. per annum, and MATURE
ing m ten yenrs after their issue that being the
to say, however, that on the sale OF these
bonds the premium received operated to re-
duce the rate of interest to be paid by the gov
eminent to less than pei cent.
cannot for moment believe that any OF
our citizens are deliberately willing that their
government should default in its pecuniary OBJ
be reduced to silver basis. At any rate !
should not feel that my duty was done il ]
omitted any effort could make to avert such
q calamity.
Change in Currency System Advocated.
The absolute enforcement of the government
from the business OF banking is the ideal rela-
tlonshlp OF the government to the circulation
OF the currency OF the country. This condition
cannot pc Immediately reached: but as stem
IN That direction, and as a means of securing a
more elastic currency and OBJ Iiat!ng other OBJ
lect1ons to the present arrangement OF bank
circulation, the secretary Of the treasury pre-
Sents IN his report scheme modifying present
banking laws and providing for the issue Of
circulating notes by 81 tie banks free from tax
alton under certain limitations.
Features of the Proposed Scheme.
1t is proposed to rep,al all laws providing for
the deposit Of United States bonds as security
for circulation: to permit national banks to
amount Is per cent of their paid up and I'M
paid capital. provided they deposit with the
government, as o guarantee fund in United
States Legal tender notes, including treasury
notes OF 1890 a SUN equal in amount to 80 per
cent. OF the notes they desire to issue, this
deposit to be maintained at all times, but
Whenever any bank retires any part Of
its guarantee fund shall be returned to it; to
permit the secretary of the treasury to pre-
pare and keep on hand ready for issue in case
an increase in circulation is desired blank ma
tional bank notes for each bank having circu-
latlon, and to repeal the provisions of the pres
ent law imposing limitations md restrictions
upon banks desiring to reduce O.. increase their
c1rculatiOn-thuS permitting such increase or
reduction within the limit of Is per cent. OF
capital to be quickly made as emergencies
arise
For Safety FUND. ,
In addition to the guarantee fund required,
it is proposed to provide safety fund for the
immediate redemption of the circulating notes
tax, say one-half of per cent, upon the
average circulation Of each bank until the
fund amount to per cent; OF the total
It's guarantee fund is to be paid into this
safety fund and it's notes are to be redeemed
IN the first instance from such safety fund
fund caused thereby to be made good from the
Immediately available cash assets of said
bank. and if these should be insufficient
pro rata a maae good 3S
other banks, their contributions constituting
first lien upon the assets OF failed bank ii
favor OF the contributing banks: as a further
security it is contemplated that the existing
condition fixing the individual liability Of
StockholderS is to be retained and the banks
Indebtedness on account OF it's circulating
notes is to be made first lien on all it's assets.
For the purpose of meeting The expense Of
printing notes, official supervision, cancella-
tlon and other like charges there shall be inn
posed tax Of say II Of per cent. per am
mum upon the average amount of notes in cir
culation 1t is further provided that there
shall be no national bank notes issued of less
denomination than ten dollars; that each ma
tional bank, except in case Of a failed bank,
shall redeem or retire its notes in the first in
stance at It's own office or at agencies to be
designated by 1t, and that no fixed reserve
need be maintained on account of deposits.
Another very important feature of this plan
is the exemption Of state banks from taxation
by the United States in cases where it is
shown to the satisfaction of the secretary of
the treasury and comptroller of the currency
by banks claiming such exemption that they
have not had outstanding their circulating
and unimpaired capital; that their stockhold-
ers are individually liable for the re-
demption OF their circulating notes to the
full extent Of their ownership of stock that
the liability of said ranks upon their
circulating notes constitutes under the: state
law. a first lien upon their assets; that such
banks have kept and maintained guarantee
fund in United States legal tender notes in
Guiding treasury notes of 1890 equal to 80 per
cent. of their outstanding circulating notes
and and; that such banks have promptly redeemed
liCIt uotcS when pfeSeuGe>la az CQelr
principal or branch Offices.
1t is quite likely that this scheme may be
usefully amended in some of its details: but
am satisfied it furnishes basis for very
great improvement in our present banking and
currency system.
COnclus on.
I conclude this communication. fully appre-
chatting that the responsibility for all legisla-
ton affecting the people of the United States
rests upon their representatives in the con-
gress. and assuring them that, whether in
accordance with recommendations have made
or not, shall be glad to cooperate in perfect
ing any leg islation that tends to the prosperity
and welfare OF our country.
GROVER CLEVELAND.
Executive Mansion, December 3, 1894.