The morning news. [volume] (Savannah, Ga.) 1887-1900, 1895-12-04
PAGES no 10.


however, been previously redeemed and
cancelled upon the issue of additional ma
the law of 1875. SO that the amount oi,i-
standing at the time of the passage or
the act forbidding their further retire
ment was SSi6, 6Sl .0l6. The law of 1878 did
not stop at distinct prohibition, but con-
tanned, in addition, the following express
provision: And when any OF said notes
may be redeemed or be received into the
treasury under any law. from any source
whatever and shall belong TO the United
states they shall not be retired, can
ceiled, or destroyed. but they shall be re-
ISSUED and paid out again and kept in
This was the condition Of affairs on the
lst day on January, 1879. which had been
fixed upon four years before as the date
Tor entering upon the redemption and re-
tirement OF these notes. and for which
such abundant means had been provided
The government was put in the anOma-
ious situation OF owing to the holders OF
ITS notes debts payable in gold, on demand
which could neither be retired by receive
ing such notes in discharge OF obligatiOnF
due the government, nor cancelled by act
ual payments in gold. 1t was forced TO re
deem without redemption and to pay with
out acquittance.
There had been issued and sold sos. 500.
600 of the bonds authorized by the resump-
tion act OF 1870. the proceeds OF which. to-
gether with other gold in the treasury,
created gold fund sufficient to the de.
mands which might be made upon it for
the redemption of the outstanding United
states notes. This fund together with such
time on the treasury available for the
same purpose, has since been called our
gold reserve and 800. 100000 has been re-
garded as an adequate amount to accom-
plish its object. This fund amounted on
the LIST day of January, 1879. to $144, 1876, $50,
ana though thereafter constantly fuctuat-
ing II did not fall below that sum until
July. 1892 In April. 1888 for the first time
since its establishment, this reserve
amounted to less than $l00,00O0O0 contain
ing at that date only 1901, $50. In the
meantime and In July. 1890. an act had
been passed directing larger govern
mental monthly purchases OF silver than
had been required under previous laws,
and providing that in payment for such
silver treasury notes of the United States
should be issued payable on demand in
gold or silver coin at the discretion of the
Secretary of the Treasury 1t was, how
ever, declared in the act to be the estab-
lshed policy Of the United States to main
tain the two metals on parity with each
other upon the present legal ratio. or such
ratio as may be provided by law In view
OF this declaration ii was not deemed per-
missible for the Secretary of the Treasury
TO exercise the discretion i'm terms con-
ferred on him, by refusing TO pay gold on
these notes when demanded because by
such discrimination in favor of the gold
dollar. the so-caled parity OF the two me-
tails would be destroyed and grave and
dangerous consequences would be precip-
itated by affirming or accentuating the con-
stantly widening disparity between their
actual values under their existing ratio.
1t thus resulted that the treasury issued
notes in payment Of silver purchases dncer
the law OF 1890 were necessarily treated as
gold obligations, at the option of the hol-
der. These notes on the LIST day OF No
vember, 1893. when the law compelling the
monthly purchase Of silver was repealed,
amounted to more than $l55.OO0,00o. The
notes of this description now outstanding,
added to the United States still undemin-
ished by redemption or cancellation con-
amounting to Nearly $780, 600 CO. S'' T TiH
obligations are the instruments which,
ever since, we have had gold reserve.
have been used TO deplete II.
rms reserve, as has been stated, had
fallen I'm April, 1888, to S970ll, 1880. 1t has
from that time TO the present, with very
few and unimportant and upward move
ments. steadily decreased, except as 1t
has been temporarily replenished by the
sale of bonds. Among the causes for this
constant and uniform shrinkage in this
fund may be mentioned the great falling
off of exports under the operation of the
tariff law until recently in force, which
crippled our exchange OF commodities
with foreign nations and necessitated to
some extent the payment of our balances
In gold, the unnatural infusion of silver
into our currency, anu the increasing agi-
tation for its free and unlimited coinage.
which have created apprehension as to
our disposition or ability to continue gold
payments; the consequent boarding OF
gold at home and the stoppage of invest
ments OF foreign capital as well as the
abroad; and the high rate of foreign ex-
change, which induced the shipment Of
our gold to be drawn against as a mat
ter OF speculation. In consequence OF
these conditions the gold reserve on the
first day OF February, 1894. was reduced
100000 during the preceding nine months.
or since April, 1898. It's replenishment be-
ing necessary. and no other manner Of
accomplishing 1t being possible, resort
was had to the issue and sale of bonds
provided for by the resumption act OF
1875. Fifty millions of these bonds were
sold, yielding s5S 633. 2957l which was
added to the reserve fund of gold then
on hand. As result of this operation this
ful.
stood on the 9Th day of March, 1894, at
the sum of Sl07 $3.50 It's depletion was.
however. Immediately thereafter so ac-
CELEBRATED that on the 3Oth day of June,
1894, it had fallen to $64,Sl3 OPS, thus losing
by Withdrawals more than $42, 90 900, In
its situation when the sale of $50.000,0O
in bonds was effected for its replenish-
worse and on the oath day of Novem-
Der, 1894, our gold reserve being reduced
to S57 ,669, 70l it became necessary to again
strengthen ii. This was done by another
sale of bonds, amounting to S5000l.00a
from which there was realized S5S55S. 500,
with which the fund was increased to
Sill, 02l on the 4th day of December.
1894.
Again disappointment awaited the an
xious hope for relief. There was not even
lull in the exasperating Withdrawals
OF gold; on the contrary. they grew larger
ana more persistent than ever between
Dec. T. 1894 and early in February, 1885.
d
after the second reinforcement of our
gold reserve by the sale Of bonds II had
lost by such Withdrawals more than $685.
600 600 and had fallen to 81, 340,1S1. Nearly
$i3, 00c, 600 had been withdrawn within the
month Immediately preceding this situa-
ton. In anticipation of impending trou-
BILE. l had, on Jan. 2S, 1895, addressed q
communication to the congress, fully set
ting forth our difficulties and dangerous
position, and earnestly recommending that
authority be given the Secretary OF the
Treasury to issue bonds bearing a low
rate of interest. payable by their terms
in gold, for the purpose of maintaining =
sufficient gold reserve, and also for the
redemption and cancellation of outstand-
ing United States notes and the treas
ury notes issued for The purchase Of slg-
yer under the law of 1880. This recon-
mendation did not, however, meet with
approval. In February, 1895, therefore,
the situation was exceedingly critical
With a reserve perilously low and re-
fusal of congressional aid, everything IN
dicated that the end of gold payments
by the government was imminent The
results of prior bond issues had been ex-
ceedingly unsatisfactory and the large
Withdrawals of gold Immediately succeed
ing their public sale in open market save
rise TO a reasonable suspicion that a