The Austin weekly statesman. (Austin, Tex.) 1883-1898, 1895-10-03
SOME DISCUSSION AS TO WHAT
WILL BE THE OUTCOME
OF THE PREENT CONDITION OF
THE GOLD RESERVE.
Some Believe That Another Dicker
Should be Made With the Syndicate
for Another Loan, While 9th
ers Oppose it.

| mont Morgan syndicate continue " IL
Mace the Withdrawals. Last week 81,
100000 was exported, and the reserve
was reduced to about $96,OOO,OO0. IL
spite of the syndicate's voluntary aid
and the assurances of Mr.. Morgan thai
the formal expiration of the contrac
would not lead to any change of attitude
toward the treasury, the question is anx
iously asked in the press, how the golC
shipments will be checked and another
scare" averted when the syndicate shall
have ceased "to bear the burden of sup
porting the credit of the United States,
as the situation is described by Rhodes
Journal of Banking. Some believe that
another bond issue is imminent, although
Secretary Carlisle expresses his belief
that the gold reserve in the treasury will
be increased by the movement of our cot
ton and wheat crops, and that no necessi,
ty for borrowing gold will arise. Bank,
| ing journals are uttering warnings
| against too optimistic view of the gold
| exports, and believe that d renewed de-
| pletion of the treasury is by no means
| improbable. Should it be necessary for
the government to appear in the loan
market again the question of another
| contract with the syndicate is likely to
| be vigorously debated. Differences of
| opinion on this point are already finding
| expression. Rhodes's Journal of Bank
| ing advocates renewal of the contract.
| We quote from its EDITORIAL:
1.-THE present gold shipments, which
the syndicate will probably keep down
to minimum; are, however, an indica-
| tion of what would occur should their
protection be altogether removed. In
fact it is easy to see that if unrestrain-
ed Withdrawals of gold should recon-
mence, the treasury would not only be
depleted much more rapidly than ever be
fore, but that alarm would from previ-
Gus experience spread with more celebrity.
The government is probably watching
the situation very narrowly. While hop
Ing for an increase of revenue that would
enable it to stand alone, yet it is not at
all certain, in fact it is extremely uncer-
tain, whether there will be such sur
plus by October as will enable it to con-
troll the situation.
There remains but one course to pur-
sue, apparently, and that is to renew
the contract with the syndicate in case
the indications of revenue increase are
not much greater than they have been
during the last month. This of course
will doubtless raise a storm of Outcries
on the part of the silverites and political
opponents, but it will receive the support
of every reviving business and industry
in the country. 1t should receive the
support of every man who desires a
profitable fall trade. A renewal of
panicky conditions next fall would cost
the country more than it will have to pay
for the renewal of the contract made
with the syndicate. If it be said that
this remedy is q dangerous one and in
yolving the necessity of frequent repeti-
ton it may be answered that the remedy
is not at fault, it is the condition of the
patient If radical cure is to be at
tempted it must be by congress. The
temporary stimulus must be renewed
until that body can apply it's slow and
more permanent remedies. But above
all things it must be remembered that the
withdrawal of outside support from the
treasury without large increase of reve
nues means another financial crisis in the
fall, with another disorganization of all
Industries and business, and another slow
recovery"
On the other hand, the New York
Tribune Rep.) insists on putting an end
to what is describes as "a humiliating
and disgraceful situation" and wants
future issues of bonds to be offered in the
open market. 1t says:
Every month some balance due to
Europe on merchandise account, by rea-
son of expanding imports, is swelled by
| the return of bonds from abroad because
| they were sold at much below their mar
| ket value, so that their return to this
country yields to holders q handsome
| profit. 1t appears by no means i'm
| probable that the balances due abroad
may continue large in months which
usually bring to this country heavy ship
ments of gold from Europe. If so, and
| if the present deficiency continues, the
treasury will have to consider once more
| the need of borrowing money, and until
| October l it is under obligation to offer
! the bonds first to the syndicate, under it's
bargain of last February.
1T is only right in these circumstan-
ces to warn the president and the secre-
| tary OF the treasury that the people
| know. beyond the possibility of doubt.
| that United States bonds can be placed
at this time on terms far better than
were obtained last February. If the
administration should offer the bonds in
open market to the people, either re-
Jecting any offers by the syndicate or
deferring Il sale until the option to the
syndicate has expired, it might reason
ably. expect to get for the bonds the
much higher price which the syndicate
itself will expect to get. For the pos
Slbllity of its success in negotiation
has no other basis than the certainty
that the people will pay for the bonds
more than a syndicate of bankers will
pay. If the country is to borrow. in
order to meet the cost of that very costly
luxury, a Democratic administration. il
would at least be decent to let the people
themselves have some chance at the prof
ITS to be realized by taking the bonds
of their government"
The Baltimore American Rep) be-
lieycs, that ''the flow of gold will prob
ably be fast and furious" after the ey-
plratlon of the contract and wonders
what plan the treasury will adopt. 1t
says:
"Will more bonds be sold and new
contract made similar to that which so
shortly expires, or will the administra-
ton consider that it has gained sufficient
experience to perform its own functions
without bringing a private combination
to perform them instead?
III new contract is to be made. If
will be well to include all the operations
OF the treasury. 1t would be infinitely
more convenient to those having business
with the treasury and the country. in
view, of the recent disclosures of giraffe
bookkeeping in that branch of the pub-
nc service, would feel safer. If the