The morning news. [volume] (Savannah, Ga.) 1887-1900, 1895-10-17

tic currency. He said; Let a bank be
chartered by congress, 70 have It's Iflucl-
pa once III New 4olh city Win ~ . Us
IN every important town ana city Inc
institution should have capital Of 80
cB,Vl1, TO be invested IN United states
bonds and deposited with the treasurer
OF the United States ar Washington. Its
business and that Of its branches TO be
confined TO The issue OF CIRCULATING notes.
These notes are 10 be used in the redis-
count OF commercial paper offered 10 Il
10y the banks of the country. national,
state and private. The bank IS TO be PEI
mitted 90 advance ITS notes on CONNER
cial paper offered by any chartered bank
10 the extent OF - per cent Of the par
value of the good commercial paper
offered Inc national banks ana
all other banks are 10 be
prohibited from issuing notes. and are
IN their business from this central IN
stitution. When first opened FOR business,
the new bank is TO be permitted 10 take
In legal tenders. treasury notes and gold
coin, and 10 issue its own notes in their
places. holding the government notes and
god taken as reserve. Il would thus.
in the nrst place, receive all the legal
tender ana treasury notes and issue It's
own notes therefor. II could receive from
the government the gold reserve ana re
turn TO the latter an equal amount Of legal
IL can also issue its own notes in lieu of
the national bank notes then outstanding,
ana receive the gold for which these notes
VIA be redeemable The bank viii thus
issue a once Sfsl 90. 900 In place of treasury
ana legal tender notes and S1l2,p1Vo ia
place OF the present national bank notes,
in an 1868 1000. On this. after obtaining
the government gold reserve of Slo0W0OD
and the proceeds Of the national bank
notes, $ll2,Ol0GO. the bank Will hold re-
serves amounting in gold to S2l2Ol9O0), and
in legal tender and treasury notes 20 $751;
100000. The latter viii be turned into gold
as the government revenues permit the
treasury 10 redeem and cancel these notes
This revenue viii ultimately amount to
s663,0OOoO in gold. With such reserve
the bank can easily maintain a circulation
OF S-,UJOWOOo0 for the whole country II
so much is needed.
The bank could also be required TO
protect the silver certificates by exchang-
ing its notes for them when required.
It's notes being payable in gold, the silver
certificates and the silver dollars would
in this manner be always maintained at
par in gold.
IF this plan were carried into effect
there would be then in circulation two
kinds of paper money. the notes of the
new bank and the silver certificates. These
last amount to 1919, 73l. 752. With these
the total paper circulation Of the coun-
try could amount to $l.Sll,12l ia. This
may appear like imitation. but practically
the control of the issues would be in
the hands of the banks, who, when the
currency became redundant would send
back the bank currency for redemption
and would present more commercial pa
per for rediscount.
such a bank could prevent panics more
effectually, though on the same principle
as is now done by the clearing house
associations.
such a scheme will no doubt be called
a monopoly, but it will monOpolize a
privilege that is of no benefit, either
to tne government or the banks. With
well managed institution Of this kind reg
ulating the paper issues of the country,
a panic like that Of 1898 would be i'm
possible.
THE elasticity OF this system would
be its prominent feature. The amount
of its issues above the minimum required
when business was most depressed would
T.g. rN.e gl Frsf.nr Frr
mand, manifested through the banks. The
notes would be issued to give circulation
to the country's commercial paper and
would be retired with the payment of
that paper"