The Yale expositor. (Yale, St. Clair County, Mich.) 1894-current, 1895-12-20


abroad, and accepted deposits OF gold
then held in this country to complete
the delivery"
The beneficial effects OF this transac-
ton, the secretary says, were felt i'm
mediately not only In this country, but
in every other having commercial re-
lations with us. He goes on: Our
past experience with the United States
notes and treasury notes has clearly
shown thaA the policy Of attempting
20 retain these obligations of the gov
ernment permanently as a part Of our
circulating medium, and TO redeem
them IN coin on presentation and re-
Issue them after redemption, must be
abandoned, OF that such means must
be at once provided as will have a ten
dency 10 facilitate the efforts Of the
secretary to accumulate and maintain
coin reserve sufficient in amount to
keep the public constantly assured OF
the stability of our entire volume OF
currency and of our ability at all times
to preserve equality in the exchange
able value of it's various parts.
The issue of bonds TO procure coin
for the reserve, which is the only CT
fectual method now available under inc
law, will, unless conditions which have
already been developed BY the present
policy are radically changed, ultimately
result in the creation of public debt
much larger than would be required 10
retire and cancel all the notes, and the
annual interest charge would be much
greater than it would be necessary 10
incur on new class of bonds adapted
TO the present circumstances of the
government and the well-known prefer
ences of investors.
IF, however, an attempt is 10 be
made to keep the United States notes
and treasury notes permanently in cir
culation by reissues after redemption
and the government is TO be permanent
ly charged with the duty of sustaining
the value OF all our currency, paper
and coin alike, the conclusion cannot
be avoided that the policy OF issuing
bonds for the accomplishment of these
purposes must also become permanent.
and such additional powers must be
conferred upon the secretary as will
enable him to execute the laws relating
to these subjects with the least possible
disturbance of the business affairs OF
the people and the least possible charge
upon the treasury.
Il am thoroughly convinced that this
policy ought not TO be continued but
that the United States and treasury
notes should be retired from circulation
at the earliest practicable day and that
the government should be wholly re-
lieved from the responsibility of pro-
viding a credit currency for the people
IF our legal-tender notes were re-
tired there is abundant reason to be-
lieve that very large amount of gold
which has been excluded from the coun-
try by the excessive use OF silver and
paper in our circulation would promptly
return to take its place in our currency
and constitute permanent part of our
medium of exchange. The retirement
and cancellation OF The legal-tender
notes would not necessarily produce
any contraction Of the circulation; and
If such result should follow and con
tinue for any considerable period it
would be q demonstration of the fact
that the volume of currency previously
existing was not needed in the business
of the people, for wherever the volume
is reduced below the actual require
ments Of trade the deficiency will be
supplied either from abroad in ex-
change for our products and securities,
or by the banks at home or both.
Long adherence to a false system has
to a great extent undermined our ma
tional credit, so far as it is related to
the maintenance OF n sound currency.
and it must be reconstructed, not mere
ly propped up by frail and temporary
supports. There is but one safe and
effectual way to protect our treasury
and that is to retire and cancel the
notes which constitute the only means
through which the Withdrawals can be
made. Many partial and temporary
remedies may be suggested and urged
with more or less plausibility, but this
is the only one that will certainly re-
move the real cause of our troubles
and give assurance of permanent pro-
lection against their recurrence in the
future.
This can be most successfully and
economically accomplished by author
izing the secretary of the treasury to
issue from time to time bonds payable
in gold, bearing interest at a rate not
exceeding per cent per annum, and
having q long time to run, and to ex-
change the bonds for United States
notes and treasury notes upon such
terms as may be most advantageous to-
the government, or to sell them abroad
for gold whenever in his judgment, it
is advisable to do so, and use the gold
thus obtained in redeeming the out
standing notes.
Under the operation Of such a plan.
IL judiciously executed, there could be.
no improper contraction of the circula-
ton, because, II 1t should at any time
be found that other forms of currency
were not being supplied to the extent
required, exchanges of bonds for notes
would be suspended and gold would be
procured by selling the securities