The times. [volume] (Richmond, Va.) 1890-1903, 1896-02-20
THE TKEAsURY'S STRENGTH DOES
NOT MEET THE ISSUE.

The letter signed j. II. D.. which we
published yesterday, is from one of the
best-informed men in Richmond, and It
undoubtedly gives the facts in connection
with the condition of the Treasury OF
the United States correctly. But, in our
opinion. IT draws a wrong inference from
those facts, and it is an inference which
we think will he fruitful of mischief
unless it's error is promptly pointed out.
The case j. II. ID. makes is briefly this:
When the present bond deal is completed
there will be in the Treasury SlOO,cOOOOO
in gold and s2i4.Oo0.OOO in greenbacks
and Treasury notes, leaving only about
sec. 100000 of greenbacks and Treasury
notes to drag the Treasury for gold, or
one gold dollar for every s2.76 OF paper
Large parts of the Governments money
will be left, says j. II. d., on deposit
with the New York banks, and when
ever exporters of gold begin 10 send
that metal out of the country, the Gov
eminent may withdraw part of It's money
from the banks, and thus raise interest.
This is exceedingly plausible, but IL
Will not meet the sort of emergencies
that our present condition faces the
country with, and the danger is that the
country may come to rely upon this
suggestion and cease its efforts TO eradi-
cate the real source of our troubles. The
real cause for the drafts on our Treasury
for gold is the clamor for free coinage oil
silver. 1t does not lie in a fear that
the Governments gold reserve is insult
6cient for the amount of its demand obli-
cations. We owe an immense sum
abroad TO people who OWN securities IS
sued in this country estimated as hiSh
as $1,000, OO0 900. Foreigners, hearing so
much talk of the free coinage of silver,
fear that we are going 10 descend TO
the level Of a fifty-cent dollar, and they
have been sending their securities here
and selling them while they can get gold
dollars for them. The brokers who sell
them on the New York Stock Exchange
are paid for them with the Governments
demand notes; they take these to the
United States sub-treasury i'll New YORK.
get gold for them, and send the gold 10
their European correspondents who sent
over the securities for sale.
Now, it is obvious that SO long as the
fear of free coinage hangs over the coun-
try. this apprehension in the minds OF
foreign holders of American securities
viii continue, however strong the Treas
ury may be in respect OF the gold II
holds compared with the demand obll-
cations outstanding for gold.
The real question is not whether $780,
100000 OF gold is sufficient reserve for
s276, 900 900 OF demand notes. but whether
there is a sufficient amount OF gold in
the country for all the demands that
American finance may have made upon
il. In this view of the case, It is obvl-
Gus that though the Government could
raise the rates of interest by withdraw
ing It's deposits. that would not tend to
end the drain on our gold. The Euro
pean who had his fears aroused lest he
should be required 10 take fifty-cent
silver dollars when hundred-cent gold
dollars were his due would not be tempt
ed by the high rate OF interest to leave
his securities TO be paid in cheap silver
dollars.
The suggestion of J. IL. ID. would be
OF an admirable tendency IL there were
no threat OF free coinage. But it would
not have the slightest tendency TO arrest
| that drain on our gold that comes from
alarmed foreigners selling their Ameri-
can securities. The only real outcome
We see from this great banking-up OF
| grcenbacks and Treasury notes in the
| Treasury is that another Reed billion
dollar. wasteful Congress will look on 1t
as so much cash TO be appropriated. and,
backed by the clamor that 1t contracts
the currency to that extent. that they
will squander it as the Reed Congress
squandered the accumulation that Mr..
| Cleveland left in the Treasury at the
| end Of his first term.
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