Hot Springs weekly star. (Hot Springs, S.D.) 1892-1917, 1897-12-31
M.KiNLEv's ADVICE TO CON.
0RESs HIGHLY COMMENDED.
A Strong, Calm and Forceful Utter
ance ON the Currency, Cuban and
Other Questions Now Before the
'country-His Views Are Sound.
Received with Favor.

added that the comment upon them IS
extremely favorable. Aside from a
few people who are determined not to
he satisfied with anything the Presi-
dent does, the expression of views
upon his message and recommended
tions was favorable in character and
the commentator of his attitude on
leading questions was in such clear
and vigorous terms as to leave no
doubt that the hands of President Nc
Kin!ey r being cordially upheld by
the people of the United States ire
spective of party.
h Currency Question.
On the currency question the clear
cut. concise and pointed recommended
tons are received With marked favor.
The President recommends in brief.
that so oon as the of the
government equal the expenditures II
new system be adopted by which all
United States notes which are redeem
ed i'll gold shall be set aside as n
separate fund and not reissued except
for gold. This process would break
the so-called endless chain" by which
the gold has been ON former oc-
casions pumped out of the Treasury.
The greenbacks are upon their face re-
dsemable in gold upon presentation,
while the declaration of Congress that
the policy Of the Government is to
maintain all Of its currency at par with
gold has been looked upon as indirect
ly ut least bringing the notes issued
under the so-called Sherman act with
in that category. The law as it now
stands requires that g%reenIacks. when
redeemed in gold shall be reissued by
the Government i'll current business
transactions and this of course makes
it practicable to use them again for
drawing more gold o,1t OF the Treasury,
thus they become what is popularity
known as the endless chain for the con-
slant Withdrawals of gold.
Should the Presidents recommended
ton be adopted those notes which are
redeemed i'll gold would not be reissued
and thus the opportunity for continued
Withdrawals of gold would Don cease.
The criticism which is made by those
desiring to criticise this proposition is
that it would result i'll IL contraction of
the currency because those notes thus
redeemed and retained in the Treasury
would not again go into circulation and
thus the circulating medium of the
country be practically reduced to that
extent. This objection is me- however
by Il further recommendation by the
President that the national banks be
permitted to issue currency up to the
par value of the bonds deposited as Sc
curity for their circulation instead of
80 per cent. Of their face value as at
present; also that the government tax
upon national bank circulation be re-
duced to one-half of per cent. in
stead of II per cen as at present.
1t is believed that this. If adopted,
would lead the national banks to in
crease their currency to Il greater M
ten than the reduction in currency
which might rome from the retention
of the United States notes redeemed in
gold. The national banks at present
utilize as a basis for their currency
less than one-half of the government
bonds outstanding.
1t would thus, in case Of an increased
demand for currency, be practicable
for them to increase very materially the
amount of their currency. Up to this
time they have utilized only small pro-
portion of the bonds available for that
purpose because of the fact that there
is not sufficient profit in the issuance
of their notes to warrant such action
and If the Presidents recommendations
arc carried out and they are permitted
to issue notes up to the par value of
the bonds and the tax upon their cur
rency is reduced 1t is believed that it
will certainly add to the currency of
the country more than any reduction
which would follow the retention in the
treasury of the United States notes re-
deemed in gold. The President also
recommends that the banks themselves
be required to redeem their own notes
in god. Thus, by the gradual retire
ment of those obligations of the Gov
eminent upon which gold can constant
~ be demanded and making the obliga-
tions of the banks payable by those
banks in gold, the foundation is laid
for n gradual transfer to the banks of
the burden Of supplying the gold de-
manded by the country.
This general proposition which lays
the foundation for a final retirement
of the gold demand obligations and
transfer of this burden to the banks
as is the case in other parts of the
world, is looked upon as a simple, plain
and easy beginning Of a system which
will gradually and finally bring the de-
sired result and do SO in a way which
will not disturb business conditions or
require radical action in the way of an
increase in the interest bearing obliea-
tlons of the Government. This view of
the Presidents proposition renders it
generally acceptable and results in fav-
orable comment from not only members
of his party, but a large element of
those composing the opposition parties.
The Cuban Question.
The Presidents expressions upon the
Cuban question are also earnestly and
warmly commended by members of all