Evening star., 1895-08-12
A NEW BOND ISSUE
One to Be Made if the Public Credit
is in Danger.
NO CALL EXPECTED THIS SUMMER
The Announcement Given So as
Not to Disturb Business.
THE SYNDICATE'S WORK

A new issue of bonds will be made the
moment there is danger to the public
credit. This is the news which comes
from close friends of the President, and it
is in entire harmony with his declarations
last winter. when the contract was made
with the syndicate. Matters will not be
allowed to drift so far as at that time. The
President did not feel justified in taking
action then until he had given Congress an
opportunity to consider the subject of cur
rency reform. the retirement of the green
backs and the substitution of gold bonds
for bonds redeemable simply in coin. 1t
was the original intention at the Treasury
Department to let the reserve drift lit
tie below 100000 600 before taking action,
but the tremendous exports and the re-
demptions Of paper money which occurred
during the closing days of January took
the situation for a moment out OF the con-
troll of the treasury and carried the reserve
down with jump in twelve days from S7O.-
163,117 to $44, 705, ,967. This will not be al
lowed to occur again. If there are symp-
toms Of a real panic, which threatens to
arrest the expansion of industry and tine
restoration of business confidence, an op-
portunity will be offered the syndicate to
take new issue of bonds at a fair price,
ard If the offer is refused. terms will be
quickly made with other takers. Action
can be taken under section 300 of the Re.
vlsed Statutes. as was the case with the
last contract, or under the general authori-
ty to issue certain classes of bonds TO
cure redemption funds.
No Call Expected This Summer.
There is no expectation at the treasury
that a new bond issue will be called for
this summer. The admission that it will
bo II uoodad m pr0npf1v Ia
simply intended to forestall alarm and as
sure the business community that they
need have no fear that the favorable con-
ditions which prevail in trade shall be hope
lessly marred by another break down in
the public credit. The administration is
keep on issuing bonds at regular intervals.
If necessary, until Congress changes the
laws SO that some power of contracting the
currency shall exist by other means than
the export of gold There Is no fear that
the syndicate will endeavor to bring about
a situation demanding another issue OF
bonds, for the small profit they might de-
rive from 1t would count for little against
their probable losses in placing other
classes of American securities. The mana
gers Of the syndicate have several times
iitimated plainly to Secretary Carlisle that
they intended to continue their efforts to
protect the treasury and their own Gus.
toners for American securities. without
regard to the exact terms of their con.
tract. They are continuing TO offer bills OF
exchange against their own credits. and
they are prepared to take stronger action
than they have yet taken If the legitimate
demand for gold to settle balances should
develop into a speculative demand for
profit on the shipments.
No Disposition to Force the Treasury.
The evidence that the bond syndicate
have had no disposition to force the treas
ury into another loan Is afforded by the
fact that the present small demand Tor
gold for export has been delayed until the
moment when the tide usually turns and
brings gold back into this country. The
years since the passage of the Sherman law
have been years of heavy losses of gold to
the United States but even those years
have witnessed an excess Of imports IN Au-
gust in 1891 and 1898, small excess OF ex-
ports in 1894, which turned into an excess
of imports in September, and small exports
in both August and September, 1892, which
finally turned into an excess of imports in
October. The Sherman law Is believed TO
be still at work expelling gold from the
country because Of the mass Of $l5oOOo.OoO
in legal tender paper which 1t infused into
the currency. There Is no power Of con-
traction in the currency system except by
the locking up Of money in the treasury or
about s32.OOO,OOO in Sherman notes, s21 ,0Oo.-
900 in United States notes, $1O,OOO.OOO In
silver certificates and $5OOOOOO In national
bank notes. The New York banks held last
These figures indicate in some measure the
congestion Of paper money which, under
the relentless operation of Sherman's law,
Is expelling gold from the country. It is
hoped at the treasury that the demand for
small notes to move the crops will soon
ease this congestion and arrest the outward
movement of gold. Another favorable in
huence, although small one. will be the
reduction Of the monthly deficit in the
treasury, which will prevent an increase Of
the outstanding circulation by the excess Of
payments over receipts
Some Interesting Figures.
The contrast between the helpless condi-
ton Of the treasury before the bond con-
tract Of February 8. in spite Of an issue of
$5O.OOO,O 600 in bonds in November, and after
ward Is indicated by the following figures
of the monthly redemption of legal tender
paper in gold for the fiscal year 1895, and
for the first month of the new fiscal year:
1894. U.S.Notes. ShermanNotes. Total
July. $13,367 ,S64 $55J5l1 $l3,9 375
August. 4,209 $50 531 $50 4,741, ,41a
September. 6S6O31 8004S 93651S
0ct