Evening star., 1896-06-25
THE GOLD RESERVE
Treasury Officials Hope Another Bond
Issue VIII Not Be Needed.
POSITION OF THE ADMINISTRATION
Favorable Figures Of This Years
Exports and Imports.
LOSSES WILL NOT BE HEAVY

LOSSES WILL NOT BE HEAVY
The arrest of gold exports during June
and the declaration of the ST. Louis con-
vention for the sold standard are encourag-
ing the belief at the Treasury Department
that the last issue of bonds has been made
which will be required under the present
administration. 1t was hoped, when the
popular loan was placed last February, that
the gold reserve could be maintained near
ly intact until March T. 1897, and this hope
has not been abandoned by treasury Off
cials. President Cleveland, it is said, will
not hesitate to make another bond issue if
the reserve is so much impaired as to again
threaten the public credit, but If there are
no serious losses to the treasury during the
summer or until after the election of the
next President, MIR. Cleveland will, it is
thought, defer to his wishes to some extent
as to whether bonds shall be issued before
the change of administration or after. He
will, 1t is believed, feel natural delicacy
about making a bond issue upon the eve of
quired. But, it is claimed, he can throw the
responsibility upon the incoming adminis-
tration, and conform his action to their
wishes, by public consultation with the
incoming President, and may thus maintain
the reserve at a safe point without embar-
RAISING the policy of the new President.
There has been no disposition at the Treas
ury Department or the White House to put
the new administration in hole in this
matter, as it is claimed the present admin
istration was placed by President Harrison,
but 1t has been felt that if the new admin
istration did not propose to pursue the
policy of issuing bonds under existing law
to maintain the public credit, the outgoing
administration should not embarrass them
by large bond issue without their consent.
Eject of "a Free Silver Declaration,
The ability of the treasury to maintain
the gold reserve unimpaired during the sum-
mer and autumn depends, according to the
friends of the administration, to some ex-
tent upon the effect of declara ton for free
silver by the Chicago convention. 1t has
been feared that such declarat ation would
be disastrous to the public credit and the
national finances. But this fear has been
somewhat mitigated by the strong declara-
ton of the st. Louis convention for the
gold standard and the beneficial effect upon
tie market. Outside of political accidents
the history of normal and abnormal years
OF gold exports seems to indicate that the
net losses to the reserve will not be heavy
during the summer. The reserve increased
In 1892 from s1i0.4Li, POI on July 81 to sl24-
Wb.1l on October Il. The reserve remained
substantially unchanged in 1893 from April
TO october, and then began the heavy losses
which compelled the bond issue of Feb
ruary, 1S.4 The reserve again remained
nearly intact during the summer of 1894
although it touched s54,913,6O7 on July 81,
and did not suffer seriously until October
when another bond issue became a neces-
Stty- The transactions of 1895 were domi-
mated by the contract with the Morgan syn
dicate, and the export movement which
might have taken place in the spring, was
postponed until August and September
Even under these conditions the reserve
stood at S2.9i3.1I9 on October 81, and the
great losses did not occur until the follow
ing months. The gold exports during july
august and September. 1898, were about
Sio.ocoDO. but the reserve suffered a net
loss of only about s15,OOO, ,OCO owing. it is
SAID, to the liberal deposits of gold by the
syndicate outside the amount required by
the terms of their contract.
Two Conditions Counted On.
Two conditions are counted upon to
maintain the gold reserve during the pres
ent summer and autumn, in the absence of
a serious panic due to political causes
One of these conditions Is the usual de-
mand for small currency to move the crops,
and the other is the favorable balance of
merchandise transactions. Secretary Car
Isle has Kept in force the circular issued
last fall, ofrering to pay the express char,-
es both ways WREN gold Is offered to the
government In exchange for currency. This
policy, OF something similar to it, enabled
Secretary Foster to Increase the reserve
s14,oOO,OpO in three months In 1892 in the
face of Eearly s20OO,0O0 of note redemD-
tions by the New York subtreasury. The
exchange of currency for gold even with
out the payment of express charges in all
cases, built up the reserve $1,000, 600 in the
autumn OF 1894 The demand for currency
has been less during the past two or three
years than under normal trade conditions
because Of the dullness in the markets AMI
the accumulation of money in New York
1t Is expected that there will be a more
active demand this summer, and amp,e
pre- operations have been made by Treasurer
Morgan and the bureau of engraving and
printing to supply any class of notes which
may be desired. The other force counted
upon to protect the reserve-the state of
the foreign trade balances operating more
strongly this year in favor of the United
States than for several years past. The
balance of exports of merchandise during
the five months ending with May was
about S63.Un.T0 This affords a higher
monthly average than the figures for the
calendar year 1894, when tine excess IF
exports was $t4S, 1g1 .9,S. That wear was
one of exceptionally large exports, be-
cause of the low prices which followed the
paric, the inability to buy foreign goo.is
and the demand for foreign exchange to
pay for American securities dumped upon
the home market by foreign investors
The total exports of that year. in the alb
SERGE of any special demand for cereals
were SS-D,Iu-.-fS, the imports were only
s616.3io.310.
Figures for the Present Year.
The figures for the present year show a
material Increase in imports ard exports
over the record of some of the years of
depression, but the balance is largely on
the side of experts. The eleven months
of the fiscal year ending In May showed an
excess of exports of only $92 ,M7-an
improvement of $1O,5O0,OOo over 1SG-but
the figures for the five months of the
calendar year show an Improvement If
more than s6o.000,000. The treasury Off
Gals do not adhere to the mercantile theory
or to the belief that the volume of mer-
chandise transactions is the measure of the
balance of gold imports and exports, but
they feel that a favorable mere chandise bal
ance is an encouraging indication of dimn-
ishing gold exports. Their belief in this
respect is considered TO be confirmed by
the fact that there has not yet been any
alarming movement of American securi-
ties held abroad toward this country, and
that none is likely to occur unless the
threat of a silver victory in November be-
comes serious.
The Oregon Accepted.