The Union times. [volume] (Union, S.C.) 1894-1918, 1894-12-14

'"S
security for circulation.
- Permit national banks to issue notes
to an amount not exceeding 75 per cent. Of
their paid up and unimpared capital, but
require each bank before receiving notes to
deposit q guarantee fund, consisting of
United States legal tender notes, including
Trcn,ury notes Of 1890, to the am cunt Of so
per cent. upon the circulating notes out.
standing to be maintained at all times and
whenever o bank retires its circulation, in
whole or in part, its guarantee fund 10 be
returned to it in proportion TO the amount
Of notes retired.
3. Retain the provision of law making
stockholders individually liable, anL pro-
vide that the circulating notes shall consii-
tute n frat lien upon all the assets (f the
bank.
4. Impose tax of J of per cent. rer
annum, payable semi-annually, upon The
average amount Of notes in circulation, 10
defray the expenses Of printing notes, obi
cial supervision, cancellation, &C.
8. No nat onal bank >i{ote 10 be of less
denomination than $40, and all notes of the
same denomination to he uniform in des gn
tut banks desiring 10 red saY Their no'cs in
gold may have them ma,ir payable in that
coin. The Secretary of the Treasury to
have authority to prepare and keep on hand
rSaly LOT lSSuC upOh opPhN r''oh " hNSS' w
Of blank national notes for each banking
association having circulation.
q. REQUIRE each national banking associa-
tion TO redeem its notes at is own Office, or
at its own office aud at agencies to be dcsig-
mated by it.
Z. To provide a safety fund for the i'm
mediate redemption of the circulating notes
of failed banks, impose tox Of onc-half Of
| per cent. per annum upon the average
circulation of each bank until the fund
amounts to 3 per cent. Of the total circua'
ton outstanding. Require each new bauk,
a"d each bank taking out additional circu-
la,iug to deposit its proper proportion OF
this fund before receiving notes. When
bank fails, its guarantee fund held on de-
pcst to be paid into the safety fund and
used in the redemption of its notes, and If
this fund shall be impaired by the redemp-
ton of the notes Of failed national banks,
anl the Immediately available cash assests
of such banks are insufficient to re-establish
the fund, it slal at once be made good by
pro rata assessments upon the other banks,
according to the amounts Of their outstand-
ing circulation but there shall be first
lien upon all the assets Of the failed bank
or banks, to reimburse the contributing
banks The safety fund may be invested Ill
outstanding United States bonds having the
longest time to run, the bonds and the IN
tcrest upon them to be held as part of the
fund and sold when necessary to redeem
notes of failed banks.
s. Repeal the provisions Of rcorgaa''r-
ton and extension act OF July IL, loo-,
imposing limitations upon the reduction
and increase of national bank circulation.
g. Repeal all provisions Of law requiring
banks to keep q reserve ON account OF de-
posits.
TO- The Secretary of the Treasury may,
in his discretion, use any surplus revenue in
the United States in the redemption and
retirement CT United States legal tender
notes, bit such redemption shall not in the
aggregate excecl an amount equal to 40 per
ceut. Of the additional circulation taken out
by Na,ioual aud State banks un|cr The sys-
tenn herein proposed.
H. Circulation notes issued by q banking
corporation duly Organized under the laws
Of any state, and which transacts no other
than banking business shall be exempt
from taxation under the laws Of the United
States when i. is shown to the satisfaction
of the Secretary of the Treasury, aud Comp
trOller Of the Currency l. That such banks
ha, at no time hal outstanding its circulat-
ing notes in excess of 20 per ccntum OF its
paid up and unimpaired capital; :. that its
stockholders are individually liable for the
relemp,ion ofits circulating notes to the full
extent of their ownership of stock; ., that
the circulating notes constitute by Jaw
first lien upon oil the assets Of the bank, A.
that the bank has at all times kept guar
antec funl in United States legal tender
notes. including Treasury notes OF 1870
equal to 30 per ccntum OF Its Outstanding
circulating notes; and 5, that it has promptly
redeemed its notes on dcman at its Princl-
pal Office or at one or more OF its branch
offices, if it has branches.
II. The Secretary Of the Treasury may,
under proper rules and regulations to be
cstab,i ,ished by him, permit State banks TO
procure and use in the preparation of their
notes the distinctive paper used III printing
United States securities; but no State bank
sb,ll nrint or engraye its notes in similitudc
of a United States note or certificate or
National bank nore
This plan you will observe remedies two
very apparent defects in tho National Bank
ing system. FIRST the want Of elasticity
Under our present system the banks have to
deposit over q hundred dollars in bonds, for
the bonds are above par, to secure every
ninety dollars issued ia notes, and on re-
firing their notes they are compelled TO
wait SIX months before they are allowed to
make n new issue. Under the above plan
the banks would have TO deposit only thirty
dollars for every one hundred dollars issued
within the limits prescribed. and notes
could be retired and reissurd to suit the
convenience of trade.
Second Government liability to redeem
in coin and obligation to reissue Treasury
notes. Under the present system it is pos
siblc for those commanding large amounts
Of money to Systematically deplete the
treasury of gold and thus compel the issue
Of bonds from time to time. This is actual
ly being done now whether deliberately or
not we c,nnot tell. OF course thi, could
not be donO under Mr.. Carlisle's plan ms
under it the government is entirely exempt
from all liability in the premises, except to
the oxtent of the redemption and guarantee
funds and the banks Themselves are ulti-