The Austin weekly statesman. (Austin, Tex.) 1883-1898, 1894-12-13

| t4N NOSNIuNuCGS VI tue pres
ent unwise policy.
A brief statement of the practicable anG
unavoidable results of the existing legis
latlon will demonstrate its serious effects
upon our financial affairs more clearly
imam any argument that could be sub.
mitted. 'u'
The secretary then reviews the circum.
stances leading up to the first $50. DOC. OOO
lof bonds as means of replenishing the
gold reserve, including $4S, 660,917, and in
creaslng the free gold in the treasury to
$Iof ,446,SO2 The lowest point reached by
the reserve since the resumption of specie
payments was on the 7th day of August,
ioSt, Wnen by reason of withdrawals in
me 9ne redemption of notes, it was reduced to
$52, 1S9,500. After that date it was
slowly replenished by voluntary exchanges
of gold coin for United States notes by
banks and by small receipts of gold in the
payment of dues to the government until
the l4th day of November, 1894, when it
reached the sum of SCI ,S7S.374.
In the meantime, however, the infre-
quent presentation of notes for redemption
in gold by individuals and institutions
not desiring it for export, clearly nd
Gated the existence of a feeling of un-
easiness in the public mind while foreign
exchange was almost constantly at or
near rate which made it more profta-
BILE to export gold than to purchase bills
and consequently Withdrawals for ship
ment were daily threatened.
In addition to these causes of anxiety
the vast accumulation of money at our
financial centers and the general depres-
sion in business which prevailed in this
country had so reduced the rates of dis
count that the inducement to keep funds
abroad where better investments could be
made were much greater than in ordinary
times, and this, together with the other
facts stated, made it highly imprudent to
neglect any precaution which appeared
necessary to insure the safety of our
financial position.
Therefore, the second issue of S50,000,-
600 was decided upon. For this issue. pro-
posals which We're issued last month 4SG
bids were received, amounting to S17S,-
336,O5O, nearly all of which were at rates
which would yield to the investor 3 per
cent or less.
One bid for the whole sum of $50,OOO.-
600 was upon the basis of 2S7S per cent
and being the most advantageous offer
for the government that was made, either
singly or by aggregate, in the separate
bids, was accepted, and the proceedings of
the sale, $5S,53S, 800, have nearly all been
paid in the treasury, according to the
terms of the sale. The transaction justi-
ties the opinion that 2 10 per cent bond,
having reasonable time to run, could
probably have been sold at par, and GER
tainly that 3 per cent bond could have
disposed of at or above that rate. As the
authority to issue and sell bonds already
exists, and the present state of our finan-
cial legislation compels its occasional ex-
ercise, | repeat the recommendation made
in NV last animal rnnort that in tho int
est of the government and people power
be conferred upon the secretary to nego-
tiate loans at lower rate of interest and
for shorter time than are now allowed
The existence of such authority, instead
of increasing the probabilities of a fire.
quent resort to that means of raising
money. would have the contrary effect,
because when it is known that the secre-
tary of the treasury is clothed with ample
power and facilities to procure means for
the maintenance of the re-
serve, public confidence in the
ability of the government to meet promptly
all demands on it will be much stronger
than under present circumstances.
Besides, the policy of limiting the gov
eminent to the sale of antiquated bonds
bearing a rate of interest wholly incon-
sistent with the existing state of the public
credit and having a longer time to run
than is apparently necessary at the date
of its issue cannot be justified upon any
grounds of eXpediency or principles. The
laws have been so amended as to conform
to the condition and reforms of the public
credit and service at the present time
and | earnestly hope that congress will
take early and favorable action upon
this subject.
So long as there are in CIRCULATION under
IL Af fhn
coins UNEQUAL in value but equal in legal
tender qualities, every consideration of
good faith and sound policy requires the
prompt redemption of the notes on present
action in the kind of coin demanded by
the holder and the constant observance
of such administrative methods as may
he necessary to preserve the purchasing
mower of the less valuable metal. This is
essential to the continued circulation of
our standard silver dollars and their paper
representatives at par and to abandon this
policy without substituting a better one
in it's place would not only fail to cure
many of the evils now existing; but would
entail upon the people of the country
odd;t;onaI and greater ones. This situa-
tion is the necessary result of three feat
nres of our currency legislation and 1t can
NOT be permanently avoided or even tenn,
porarily improved without materlal
changes in our laws relating to that SUD-
iect. These features are:
First-The circulation of United STATES
notes as currency and their current re-
demption of coin on demand. e
Second-The compulsory reissue Oh
such notes after redemption.
Third-The excessive accumulation anu
coinage of silver and the issue OF notes
and Certificates against it upon ratlo
,rbich greatly oyervalues that metal as
comnared with the standard unit OF value
i, tb;s and other principal commercial
countries; frequent issues OF po!lde nui
the purpose of procuring g0ld Whicn can
not be kept after it has Deen o9 9;atnuot
will certainly cause increased ulstlust
among our own people as wen as hhlont
fine people of other countries anu ~.
only swell the volume OF our securllles
returned from abroad for sale or reaet el,
tion. but increase the Withdrawn Oh loi
eign capital heretofore invested Ill our
domestic enterprises; ,:..us+ of
Ordinarily when there is no distrust OF
orr currency or other discouraglng innu.
ence n considerable part OF the lnteresII
and dividends earned by foreign capllal
in this country is annually, or semi
annually invested here, and this, togethter
with the fact that under normal condl-
tions the balance of trade is in our favor
enables our people to meet their oDilga-
tions abroad without reducing their STOCK
of money at home. But when distruSt
arises either as to our ability TO pay OF
as 70 the value of the money Which we
intend to pay, the foreign capitallsI hol
only ceases to invest but proceeds 10