The Roanoke daily times. (Roanoke, Va.) 1895-1897, 1896-10-16

Assistant Secretary Dabney, of the De-
partment of agriculture, i'll which he de-
tends the New York bankers from the al
legations often made that they are inter
ested in the withdrawals of gold from the
Treasury. The letter in part is as lol
lows
''The term raids by bankers ut New
York upon the Treasury is enc frequent
ly used by writer's and speakers who have
no accurate knowledge of the method by /
which notes are presented for redemption
Mt the subrrcasury in New York, CT the
character or number of persons making
each presentation.
'''rhc term banker seems to be assumed
in most cases TO cover IL class of men who
are apparently engaged in withdrawing
the gold from the Governments reserve
and putting it away in their private
vaults for their own selfish purposes and
| to accomplish certain alleged improper
objects. The facts in the case are so
different from these fanciful statements
that it seems worth while to call attcn-
tion to them
''The people engaged in the banking
business in New York may be divided into
three classes: First, the officers of the
regular banks of deposit or issue, includ-
ing the national banks; second, the deal
ers in securities, some of whom have for
market Il large amount of securities and
/ upon whom they draw corresponding
/ amount of exchange in payment for secu-
rites sold abroad and to whom they remit
exchange or gold in payment for securi-
ties sold here; third, agencies of branches
of foreign houses who are perhaps also
, dealers in securities but whose main bus
| mess is buying and selling exchange on
Europe for the profit which can he made
in the operation itself.
1.-The first class are especially interested
in the general prosperity of the country
| and in keeping up the value of securities,
because if there is Il fall in securities held
by them as collateral, they are compelled
to call in their outstanding loans which
reduces their lines of credit dimnishes
their profits, prevents them from discount
ing commercial paper, restricts mercan-
tile and industrial enterprise and creates
failure III business.
1.-The second class are directly inter.
estcd in keeping up the value Of securi-
ties in this country which they have large
ly sold abroad, and their interests are to
: avoid gold exports and the public appre-
hension arising from reduction of the
gold reserve.
/ The third class buy or sell exchanges
! whenever an opportunity for profit oilers
If there are few commercial bills to be
had in the market and the demand by re-
mittcrs is great, exchange rates rise and
ii dealers having credit abroad find that
/ they can sell their bills ut higher price
than the probable cost to them of with
/ drawing gold from the Treasury and shin
ping it abroad to meet their bills at ma
turity, they do so, thus making IL profit
OH the transaction. The leading members
of the third class in New York can he
numbered on the fingers of both hands
and i'll fact three or four do almost all of
the withdrawing of gold for export to
Europe, published in the daily press dur
ing its continuance. Each shipment made
usually represents in the aggregate Il
large number of single transactions. One
/ concern may sell Il million dollars of eX-
change in one day, but it may be repre-
! scented by one hundred and fifty different
I bills, running from one hundred pounds
sterling upwards, and they pay these bills
abroad by shipping gold for that purpose
which they draw out of the Treasury in
one sum and send i'll one shipment 1t
will thus be seen that IL great majority of
the bankers are pccuniarly interested in
keeping the gold reserve up to it's full
amount and for this reason they have
been willing i'll the past and are still will
ling to make considerable sacrifices and
i'll order to prevent shipments of gold
have contributed large amounts OF money
to pay the dealers in foreign exchange
the profit they would have made by such
shipments. This was notably the case in
the operations of the 50. called syndicate
which brought the bonds of the Govern
ment under the contract of February s.
1873, and again in the early part of this
summer.
Although Withdrawals for export have
Been going on for several years, it is only
within two years that I'M apprehension
that the Government might be unable ia
redeem it's obligations in gold has caused
Withdrawals for any other purpose, and
at no time has there been any evidence
that Withdrawals of gold from the Treas
ury were made for The purpose of affecting
the market
During the past few weeks and at
present, and for the first time in this adj
ministration, various factors are in COM
bination which have produced low rates
of foreign exchange and consequent inn
portations of gold. The principal ones
are the favorable trade balance, the reduc-
ti0n in the volume of currency outStand-
ing and in active circulation, the coDtin-
ued high rate for financial loans at New
York, this latter condition being partly Il
result OF the preceding situation.
i e. 1t is true that gold has been imported
! upon one or two occasions lately when
purchases OF Government bonds were be-
/ ing made, but for this premium was
! paid and it was purchased and shipped
/ like cotton or wheat without regard to
the rates of exchange ruling here, and
/ was an abnormal proceeding.
n..r 1.