Evening star. [volume] (Washington, D.C.) 1854-1972, 1897-09-11
NO EFFECT ON SILVER
General Opinion as to the Action Of
the Bank Of England.
SURPRISE AMONG THE OFFICIALS
Might Be a Showing Drift Of Pub
lie Sentiment.
SMALL AMOUNT REQUIRED


England director had decided to hold one
fifth of the ank's reserve in silver causes
surprise amorg officials and others Ii
Washington interested in the currency
question. The general opinion is that the
banks action will not have any important
bearing Upon the future of silver or upon
bimetallism.
Officials of the treasury. from Secretary
Gage down. see nothing significant in the
reported action of the bank. In the frs:
place. 1t Is doubted II the Bank of England
has decided on this. and, in the next pace
tie best-poSted officials cannot agree as to
the motive actuating the decision.
Secretary Gage said that he did not see
that the decision. if true, would apprecia-
bly, affect the silver market. it was un-
likely that the Bank of England would buy
on a market which might rise in view of
its decision. and then fall after the neces-
s;ry amount of silver had been procured.
Another question with the Secretary was
whether the silver reserve wouid be carri ID
in silver coin or in bullion.
Provided ii is the intention of tine banl.
to buy silver to carry one-nfth of its re-
serve. the total purchase would amount to
about 'U.WD.Np ounces. The amount of
silver coin in circulation in the United
Kingdom is $1.Y.WDUO. To take from This
amount a reserve of $56wJ.WO without
paving out that amount in gold: would not
De the policy which the Bank of England
would be likely to pursue.
Fer five or six years there has been talk
that the Bank of England would carry
Fart of its reserve in silver. and on several
occasions the positive statement has been
made that it had decided to do so. It *
allowed under the law. as is known. to
carry one-fourth in silver. As this is per
missible. Secretary Gage would be glad to
nave the bank avail itself of its legal pre-
rosative in this direction but doubts if it
will do so.
IL Is agreed that the Bank of Enelan1
takes no risk in what it may intend 10 do
In business circles in the United Kingdom
not over $40 in silver is legal tender bur
the government is compelled to receive sill
HtF coin in payment for duties, revenues
etc The amount of silver coin in use i'm
tae tnited Kingdom, compared 20 tn.
amount in use in this country is interest
ing at this time There is in actual circu-
iatlon in this country $1l2U21 .?I6 in silver
doiaTs and subsidiary coin. but there is in
lne treasury, Tor redemption of silver GER
tihcate@, the enormous amount OF S,1I
1f".I-s' In addition, the amount in silver
ptIiion In the treasury is s105. l2512s
III would not be surprising it is th,ug,t
Dy some of the treasury officials thai the
Bank OF England has done this under an
agreement with the American iinie:a!lio
commissioners. the latter having reported
10 them that France and other E,irone,n
countries stood ready to co,,c,de mo- ~
silver should there De evidences that
rance wants more silver as well as some
oi the otner European countries this might
mean an Important change in the silver
market But treasury officials az au,aa IL,
stated. feel that the Bank of England has
taken no risks, and knew what il wa;
doing. wa
1 do not see how that action can he of
any lasting benefit to silver" said Senator
Roach of North Dakota, who is one of the
most earnest advocates of bimetallism in
the United States Senate. 1T may be a
straw showing the direction of public SEN
timent abroad, and indicating thereby A
Grange IN favor of birletalism
ne advocates of the use of silver in
tne worids currency do not argue for sill
yer m plometailism, but want to see bot
moneys used Apparently. that is lust what
the Bank of England is going to do in this
case The holding of one-fifth of the re-
serve IN silver is such small matter,
however, that the market value of sill
yer will not be affected and the action
OF the Bs nix of England is only of passing
Importance"
The director of the mint. Mr. Preston.
Is somewhat unwilling to believe that the
cabled report conveying the information
Is true.
III the announce ment is correct said
Mr Preston, lit will not help silver any
IL VIII involve only about SIG OOO. .UU and
That is not great deal. 1t does not neces
sarily near that the directors of the bank
propose TO purchase that much silver.
y Ihey coubtiess have a large amount of
silver coin in their vaults, and would onIy
convert II into their reserve
DO you thing the market price of sill
yer will be affected?" Mr. Preston was
asked
'Oh. no. 1 don't see why if sbou,d h..
AS / said. ii may not be necessary TO mr.
chase any silver at all. but even if IL were
II Is hardly probable that the market would
De anected- When the United States be-
gan 10 purchase silver under the Sher
man act. there was only a temporary rise
IN the price of silver. and 1t was but
speculative at that The rise did not con-
tinue long. and IL was but a sbort time
when silver began to go down"
Ex-RepreSentative Bartine of Nevada a
me OF the executive committee of tho
merican Bimetaliic Unicn, who is low in
~ si..iIst toIi; vas ASKED his opinion as to
the effect of the Bank of Engiand's action
upon the cause Of bimetallism.
90 not think any permanent benefit
'tlI grow out Of the matter" said MT.
wartime The amount of silver involved
- comparatively SO small as to be unirn-
portant 1t may be, too. that the bank
VIII not have to purchase any more silver
In order to accomplish this enIarged ,,se ~
silver in It's reserve
There is one way, however, in which II
may dc US good. 1t may set the people to
thinking about bimetallism. and to realize
that 1t is good thing to use both siIve~
and gold in the worlds money Ths h,-
metailists of the countries across the sea
may te encouraged by this step CT tne
most pronounced gold-using country In the
world.
In some quarters IL Is thought that a,
explanation OF this unIooke d for step upon
the part CT the Bank Of England may liz,
III the theory that II Is a concession to the
biMetallists of England, who undoubtedly
form considerable and important faction
and 10 Dlacate them for the recent acton
OF the Bank of England upon India bills
OF exchange 1t is said that IL the use of
silver In the banks reserve Will have a
favorable effect upon the finances OF Indi,
1. would be an explanation of the matter.
The amount of the Bank of England.s
reserve and capital is given by the States
mans Year Book for 1897 at fIT1I5UD
SsSi25.UND. The same authority puts tn.
deposits and post bills at ga. .S66 coo (so7I
:EatOgD. the securities at f4S3I8eOo (sotI :
5SoU0). the notes In the reserve at fep :
2IIUo Oil. .355 OOO) and the coin in the re-
serve at f2.O2i.OVO 9iO. l2o. .OOO
MIR. SANDMAN SON-COMMITTAL.
Governor of Bank Of England Dc-