The Black range., 1894-12-07
The Gold Reserve.

During the last month the gold re-
serves in the treasury for the purpose
of redeeming the notes of the govern
ment circulating as money in the
hands Of the people became so reduced
and Its furthur deplention in the near
future seemed so certain that in the ex-
ercise of proper care for the public wei
fare it seemed necessary to replenish
the reserve and thus MAINTAIN popular
faith in the ability and determination
of the government to meet as agreed,
itsl promissary obligations. 1t would
have lbeen well If In this emergency
authority had existed to issue the
bonds of the government bearing low
rate of interest and maturing within
special period.
Congress having failed to confer such
authority, resort was necessarily had
to the resumption act of 1875, and per-
suant to its provisions bonds were Is
sued drawing interest at the rate of
FIVE per cent per annum and maturing
ten years after their issuing that being
the shortest time authorized by the act.
| am glad to say. however, that on the
scale of these bonds the premium re-
cieYed operated to reduce the rate of in
terest to be paid by the government to
less than three per cent. Nothing
could be worse or furthur removed
from sensible finance than the relations
existing between the currency the
government has issued, the gold held
for its redemption and the means
which must be resorted to for the pur-
pose of replenishing such redemption
fund when impaired. EYen If the
claim upon this fund were confined to
the obligations originally intended
and in the redemption of of these OBJ
legations meant their cancellation, the
fund would be very small. But these
obligations when Tecieyed and redeem
ed in gold are not cancelled but are re-
issued and may do duty many times by
way of drawing gold from the treasury.
Thus we have an endless chain in
operation; constantly depicting the
treasury's gold and never near a final
rest. AS if this was not bad enough
we have statutory declaration that
is the policy of the government to
maintain the parity between gold and
silver aided by the force of momentum
of this exhaustive process and added
largely to the currency obligations
claiming this peculiar gold re
demption. Our small reserve is thus
subjected to Withdrawals from every
side. The demands that increase our
danger also increases the necessity of
protecting this reserve against deple
tion and it Is most unsatisfactory to
know that the protection afforded is
only temporary pallatlon, 1t is
perfectly and palpablY PLAIN that tht
only way under the present conditions
by which this reserve. when dauge
0usly depleted, can be replenIshed, Ii
through the issue and The SAFE ol ,he
bonds of the government for gold, an,
yet congress has not only thus far de
clined to authorize the Issue of bonds,
best suited to such purpose, tu
there seems a disposition in some
quarters to deny both the necessity
and power for the issue of bonds
at all. l cannot for a moment be
lleve that any Of our citizens
are deliberately willing that their
government should default in its
pecunlary obligations or that it
should be reduced to asilver basis. At
any rate | should not feel that my duty
were done if l omitted any effort l
could make to avert such calamity.
AS long therefore as no provision is
made for the final redemption or the
putting aside of currency obligations
now used to repeatedly and constantly
draw from the government its gold,
and as long as no better authority for
bond issues is allowed than at present
exists, such authority will be utilized
whenever and as often as it becomes
necessary to MAINTAIN sufficient gold
reserve and in abundant time to save
the credit Of our country and make
good the financial declaration of our
government from the Presi-
dents Message.