The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1894-12-04
An Elaborate Effort to Re-
store State Bank Notes
to Circulation.
NATIONAL BANK CHANGES
Government No Longer to Guar
antee Their Paper-How to
Circulate Silver.
Strong Reiteration of Liberal
Tariff Theories in the Annual
Treasury Report.


annual report for the Treasury Depart
nrent. submitted to Congress today, Sec
retary Carlisle says:-.I have prepared
the outlines of a plan which, in my
opinion, will relieve the Government to
great extent from the burdens now i'm
posed upon it, secure within a reasonable
time safe and elastic national and
State bank currency and result ultimate
ly in the permanent retirement of United
States legal tender notes, of both classes.
It is in brief as follows;-
l. Repeal all laws requiring or author
izing the deposit of Urdted States bonds
as security for circulation.
?. Permit National banks to issue notes
to an amount not exceeding seventy-five
per centum of their paid-up and unim-
paired capital, but require each bank be-
fore receiving notes to deposit a guaran-
tee fund, consisting of United States
legal tender notes. including Treasury
notes of 1890, to the amount of 80 per
centum upon the circulating notes ap-
piled for. This per centage of deposits
upon the circulating rsotes outstanding
to be maintained at all times and when
ever a bank retires it's circulation, in
whole or in part, its guarntee fund to be
returned to it in proportion to the amount
of notes retired.
g. Retain the provision of the law max
ing stockholders individually liable, and
provide that the circulating notes shall
constitute first lien upon all the assets
of the bank.
4. Impose a tax of one-haf of one per
centum per annum, payable semi-annual-
ly upon the average amount of notes in
circulation, to defray the expenses of
collation., etc.
5. No national bank note to be of less
denomination than ten dollars, and all
notes of the same denomination to be
uniform in design; but banks desiring
10 redeem their notes in gold may have
them made payable in that coin. The
Secretary of the Treasury TO have au-
thority to prepare and keep on hand
ready for issue upon application a re-
serve of blank national bank notes for
each banking association having circu-
lation.
6. Require each national banking assoc
iation to redeem its notes at its own Of
fee, or at its own agencies to be desig-
mated by it.
REDEMPTION FUND.
Z. To provide a safety fund for the i'm
mediate redemption of the circulating
notes of failed banks, impose tax of
per centum per annum upon the
average circulation of each bank until
the fund amounts to five per centum of
the total circulation outstanding. Re
quire each new bank, and each bank
taking out additional circulation, to de-
posit its proper proportion of this fund
before receiving notes. When bank
fails, its guarantee fund held on deposit
4o ha void mt ba md
in the redemption OF its notes and if
this fund shall be impaired by the re-
demption of the notes of failed national
banks, and the Immediately available
assets of such banks are insufficient to
re-establish the fund, it shall at once be
made good by pro rata assessments upon
the other banks, according to the
amount of their outstanding circulation;
but there shall be a first lien upon all
the assets of the failed bank, or banks,
to reimburse the contributing banks.
The safety fund may be invested in out
standing United States bonds having
the longest time to run, the bonds and
the interest upon them to be held as
part of the fund and sold when neces-
sary to redeem notes of failed banks.
8. Repeal the provisions of the re-or-
ganization and extension act of July
H. 1882. imposing limitations upon the
reduction and increases of national bank
circulation.
. 9. Repeal all provisions of the law re-
uuiring banks to keep a reserve on ac-
count of deposits.
10. The Secretary of the Treasury may,
IN his discretion, use any surplus revenue
Of the United States in the redemption
and retirement of the United States
legal tender notes, but such re-
demptions shall not in the aggre-
gate exceed an amount equal to 70 per
cent. of the additional circulation taken
out by national and State banks under
the system herein proposed.
IL. Circulation notes issued by bank
ing corporation, duly organized under
the laws of any State, and which trans
acts no other than banking business,
snail be exempt from taxation under the
laws of the United States, when it is
shown to the satisfaction of the Secre-
tary of the Treasury and the Comptrol-
Ter of the Currency.
CONDITIONS.
ID. That such bank at no time had
outstanding its circulation notes in ex-
cess of rs per cent. of its paid-up and
unimpaired capital.
(2) That it's stockholders are indiyidu-
ally liable for the redemption OF It's cir
eulating notes to the full extent of their
ownership of stock.
81. That the circulating notes consti-
tute by law a first lien upon all the as
sets of the bank.
"a. That the bank has at all times
kept a guarantee fund in United States
legal tender notes, including Treasury
notes of 1890, equal to 80 per cent. OF It's
outstanding circulating notes; and
(5). That it has promptly redeemed its
notes on demand at its principal office,
Or at one or more of its branch offices,
If it has branches
u. The Secretary of the Treasury may
ander proper rules and regulations to
pc established by him, permit State
banks to procure and use in the prepara-
ion of their notes the distinctive paper
ased in printing United States securities;
(<,,,f;nateI f39 Fourth PfI0es