The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1896-10-16
NOT DONE FOR EFFECT
NO GOLD IMPORTED By BANKERS
FOR POLITICAL PURPOSES.
Every Dollar that Has Come from
Abroad Since the Inflow began H.
Due to Natural Causes.

WASHINGTON, Oct. 15.-Assistant Secre-
tary William f. Curtis. of the Treasury De-
partment. has written d letter to Assistant
Secretary Dabney. of the Department of
Agriculture, in which he defends the New
York bankers from the allegations often
made that they are Interested in the with
drawals of gold from the treasury. In the
course OF his letter Mr.. Curtis says:
1T is true that gold has been imported
upon one or two occasions lately when pur-
chaseS of government bonds We're being
MADE, but for this a premium was paid,
and il was purchased and shipped like cot
ton or wheat, without regard 10 the rates
of exchange ruling here, and was an alb
normal proceeding. During the years sue
ceeding the resumption OF specie payments
in 1879 and until the currency question dis
turbed our monetary relations, there was a
regular movement Of gold to this country
in the late summer and autumn While We
were marketing our agricultural PRODUCTS
abroad. A return flow from this country
abroad began in the spring and continued
through the early summer to pay our debts
for imports and for other purposes. Lower
exchange rates in the former and high
rates in the latter periods caused these
movements, and the balance OF trade was
Usually in our favor, as it Is st present.
The excess Of merchandise exports over
imports for eight months up to the 1st day
of September of this year amounted to
$50, 9g1 $40, while for the corresponding time
last year the excess of merchandise i'm
ports was SAG, 367. 25S. In other words. in
stead of disbursing this latter amount in
foreign markets. we this year are receiving
from them $95, 1891, s45, a balance in our favor
c~llrities flowing back TO America from for
eign holders since 1890 has largely SUBJ
sided, at least for the time being, and there
Is not as much of d. drain from here on
that account. The high rate of interest
paid in the New York market for call loans
during the past few weeks has attracted
foreign capital from centers where the in
terest rates have been much lower. This
popularity was also very marked during
a TrpII nf 800 n = tho nfyG - %T- a1rv
rency panic, when the ruling rates of in
terest We're a~bnormally high and large
amounts of money were loaned from abroad
and the gold coin sent to this country.
The contraction in the active currency
is caused by the large increase in the bal
ance of the United States treasury arising
from the bond issues, and from the hoard
ing of gold and of notes redeemable in gold
which has been going on among the people
Tor some time. in view of q possible failure
of the United States to continue their re-
delmption in gold. The critics who talk so
for effect from the other side of the ocean
DO not seem to realize the Importance of
such a transaction, and that there must be
value exchanged for it, either in the shape
of exports or securities. or in some other
way. 1t will be seen from the published
names of the parties who receive the gold
imported that they are mainly the dealers
in exchange or houses, or institutions, hav-
ing foreign connections, and that the ma
ceive the deposits of their customers. are
not at all interested. except in the case of
one OF Two CT the larger, who have regu-
lar London correspondents with whom they
Go an exchange business. 1t must not be
forgotten that the confidence in the sftua-
ton which has placed the country in it's
present satisfactory condition regarding its
gold reserve was. largely due to The efforts
of the bankers of New York in the early
summer. The fact of their agreeing to fur
nish bills of exchange at rates under the
gold shipping point and endeavoring to
bring about artifically that which we now
know is q logical result from natural
causes. inspired SO much confidence that
normal conditions prevailed and the situa-
ton cured itself. According to the pub
lished reports during April. May. June. July
and the first week in August while gold
was being exported, the rates of sterling
sight exchange at New York have ruled
to S4.SS1a to $4-904. and during the last OF
August and up to the present time, while
imports of gold were being made, they have
ranged from 4.S34 to $4.S5A.
IF the'parties attacking these ~transac-
lions would examine the daily reports and
see who withdrew or imported the sod. and
what the exchange market was and why
the exchange rates were high or low, much
misapprehension on these subjects would
be avoided