River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1895-12-05

This was done by another sale Of bonds,
amounting TO 81. COZ. 600 for which there
was realized SIS. 53s 800, with which the
fund was increased to slil, i42, 02i on the sth
day of December. 1894
Congress Refused 10 Act
Again disappointment awaited the anxi
Gus hope for relief. In anticipation OF
of January. 1895. addressed a communion
tion TO the congress fully setting forth our
difficulties and dangerous position, and
earnestly recommending that authority be
given the secretary of the treasury 10 is
sue bonds bearing low rate OF interest
payable by their terms In gold, for the pur-
serve, and also for the redemption and
cancellation of outstanding United States
notes AMI the treasury notes issued for
the purchase OF silver under the law of
1890. THIS recommendation did not, how
ever, meet with legislative approval.
Another Emergency.
In February, 1895. therefore, the situation
was exceedingly critical. With reserve
perilously low and a refusal OF congress
sional aid everything indicated that the
end of gold payments by the government
was imminent. The results of prior bond
issues had been exceedingly unsatisfac-
tory and the large Withdrawals of gold
Immediately succeeding their public sale
In open market gave rise To reasonable
suspicion thai a large part of the gold
paid into the treasury upon such sales
was promptly drawn out again by the
presentation OF United States notes or
treasury notes and found its way TO the
hands OF those who had only tempora rily
parted with II In the purchase " bonds.
In this emergency. and I'm view of it's SUR
rounding perplexities, IL became entirely
apparent 10 those upon whom the struggle
for safety was dcvolyed not only that our
gold reserve must. for the third time Ia less
than 10 months, be restored by another
insue and sale OF bonds bearing a high rate
but that a plan must be adopted for Their
disposition promising better results than
those realized on previous sales.
The syndicate Agreement
An agreement was therefore made with
a number OF iinanciers and bankers where
by it was stipulated that bonds described
in the resumption act OF 1875 payable Ia
coin 30 years after their date. bearing in
tercst at the rate Of four per cent per am
mum, and amounting 10 about td2sWl o,al,
should be exchanged for gold, receivable
by weight. amounting TO "A little more than
SIS. Oo0.m0,
Think. risast.r Was Asert.t.
ON the day Tits contract was made H.
terms were communicated 20 congress by
a speS tai executive message, IN which il
was stated that more than tle.000.000 would
he saved 10 the government II gold -beartnF
bonds bearing three per cent. Interest were
authorized TO be substituted for those men.
toned la the contract. The congress hav-
ms declined 70 grant the necessary author
ity TO secure this saving, The contract, un-
modified. was carried out. resulting Ia 4
gold reserve amounting 10 500. A4i, l50 on "a :
stu day Of July, i@5 The performance OF
this contract not only restored the reserve.
but checked FOR a time the Withdrawals 81
gold and brought on a period OF rf.torea
confidence and such peace and quiet III
business circles as We're OF the greatest pos.
sible value TO every interest that Affects
our people
Good Results Not Permanent
Though the contract mentioned stayed
I for time the tide Of gold Withdrawal It's
good results could not be permanent. Hc.
cent Withdrawals have rdueed the reserve
from NQl ,5il 80 on the Sth day of July
1885, TO SIS aga 80. How long Il will remain
{ large enough to render its Increase unnec-
essary : only mater 81 eonJect9re. though
the immediate future arr predicted Ia we'll.
I informed quarters. About ti60o0.uso has
been withdrawn during the month Of No
Nsmher.
situation stan critical
The foregoing statement Of events and
conditions develops the fact that after lu.
crea-ing our interest bearing bonded in-
our gold reserve we are nearly where We
/ startsd. having now ~ such reserve So.
isas. when the first bonds were ISSUED
On the 18Th Of January, ise5, u was re-
that more than tl72ooo 600 OF gold had been
withdrawn for hoafding or shipment dur
INK the year preceding. lie now report )
a period Of more than II years. only a little
over t2s,0Qo,0oo was Withdrawn. and that
between July u. 100. the date q the pas
sage OF the law for an Increased purchase
OF silver. and the LIST day OF December, 1895.
or within less than b.s years, there was
I
OF more than ss0s,ooo.coo drawn from the
treasury In gold since January I. 1879, The
date fixed In 1875 for the Retirement OF ths
United States notes Nearly 1921 ,000.000 OF
the gold thus withdrawn has been paid out
on these United States notes; and yet every
one OF the s346. 90. 600 IL still uncanceied and
tons More Than s7s GOO in ego GOLD has
since their creation I'm 1880 been paid out
from the treasury upon the notes given on
the purchase of silver by the goyernment:
and yet the whole. amounting to siba. 000. 600,
except little more than xl6.0O0,000 which
have been retired by exchange for silver
at the request of the holders, remains out
Ftanding and prepared TO Join their older
and more experienced allies In future raids
upon the treasury's gold reserve.
In other words. the government has paid
in gold more than nine-tenths of its United
States notes and stiil owes them all. II has
paid In gold about one-half OF its notes
given for silver purchases without ex-
tingui5hing by such payment one dollar of
these notes, When added 20 ali this we are
reminded that TO carry on this astounding
financial scheme the government has in
CURED a bonded Indebtedness Of sos, 800 01
in establishing gold reserve, and OF si62,
3l5.400 In efforts to maintain ~; that the an
nual interest charge on such bonded IL
debtedness is more than 81 900. 900: that a
suit in further bond issues, and that we
have suffered or are threatened with all
this for the sake Of supplying gold for for
eign shipment or facilitating it's boarding
at home, a situation is exhibited which cer-
tainly ought to arrest attention and pro-
woke immaculate legislative TelleI.
Notes Should Be Retired.
I am convinced the only thorough and
practicable remedy for our troubles is
found In the retirement and cancellation
called greenbacks. and the outstanding
treasury notes issued by the government
In payment of silver purchases under the
act of 1890. j believe this could he quite
readily accomplished by the exchange OF
these notes for United States bonds of
small as well as large denominations,
bearing low rate of interest. They should
be long-term bonds, thus increasing their
doSirability as Investments, and because
their payment could be well postponed to
period far removed from present imam
cial burdens and perplexities, when with
increased prosperity and resources they
would be more easily met
Would Restore Confidence.
The increase of our bonded debt in
volved in this plan would be amply COM
pensated by renewed activity and enter
prise in ali business circles, the restored
confidence at home. the relnstated faith
I'm our monetary strength abroad. and the
stimulation of every interest and industry
that would follow the cancellation of the
gold-demand obligations now affecting us.
How to FIJI the Void.
The currency withdrawn by the retire
ment of the United States notes and treas
than 1886 100000. might be supplied by such
gold would be used on their retirement
or by an increase In the circulation of our
national banks. Though the aggregate
to more s664. zoo. 900, their outstanding cir
culation, ba sed on bond security, amounts
to only about $l9O. 100000. They are author
ICED to issue notes amounting to 80 per
cent. of the bonds deposited to secure their
circulation, but in no event beyond the
amount of their capital stock, and they
are obliged to pay one per cent tax on the
circulation they issue
think they should be allowed to issue
circulation equal to the par value of the
bonds they deposit to secure Il, and that
the tax on their circulation should be re-
duced to one-fourth of one per cent, which
would undoubtedly meet all the expense
the government incurs on their account.
In addition, they should be allowed to sub
stitute or deposit in lieu of the bonds now
required as security for their circulation
those which would be issued for the pur-
pose of retiring the United States notes
and treasury notes. The banks already ex-
listing, II they desired TO avail themselves
of the provisions Of law thus modified.
could issue circulation in addition TO that
100000. which would nearly or quite equal
the currency proposed to be Cancelled
Necessity May Not Arise.
But there might not be the necessity for
such an addition to the currency by new
issues of bank circulation as at first glance
is indicated. IL we should be relieved from
maintaining a gold reserve under condi-
lions that constitute II the barometer Of
our solvency, and If our treasury should
no longer be the foolish purveyor of gold
for nations abroad or for speculation and
boarding by our citizens at home. should
expecf to see gold resume its natural and
normal functions in the business affairs
of the country and cease to be an object
attrac ling the timid watch of our people
and exciting their sensitive imaginations.
Question of Quality. Not Quantity.
In our present predicament no gold is
received by the government in pay
be ~ the revenues were increased. The re-
ceipt.s of the treasury, when not I'm silver