The record-union., 1897-11-08
His Plan Touches Every Branch Of the
Problem.
ing Currency Obligations by
Three Per Cent. Bonds, Under n
Currency Board Composed of
the President, Secretary of the
Treasury and Comptroller of
the Currency, National Bank
Notes to be the Only Currency.

WASHINGTON, Nov. THE Mon
etary Commission is receiving in an
swer to it's invitation many interesting
propositions for reform of the banking
and currency systems of the country
and among these is one from John c.
Built which, coming highly indorsed as
it does by financial authorities, has
commanded great attention and study.
Mr. Bullit's plan touches every branch
of the problem before the commission
and its provisions in outline are as
follows:
That all of the outstanding currency
obligations, amounting to about $780,
1900, shall be taken up and can
celled, being replaced according to bus
mess eXigencies (under the direction OF
currency board composed of the Pres
ident, Secretary of the Treasury and
Comptroller of the Currency by 3 per
cent. bonds. There is to be but one
kind of currency. namely, national bank
notes redeenable in gold at the bank of
issue. and a selected bank or reserve,
and these notes are to- be issued grad
ually to replace United States obliga-
| tions as the latter are retired.
These notes are to be secured by
deposit of 10 per cent. of sold in the
treasury, by 10 per cent. gold in the
| bank vaults and by a first lien upon all
of the banks assets, as well as by a
special provision giving the Govern
ment the right to assess all national
banks when needed to make good notes
of a defaulting bank, the notes of which
would then be redeemed by the Gov
erament. A tax is to be laid upon the
banks to cover the expenses of the cur
rency board and the balance held to Sc
cure redemption of notes in gold, but IL
this exceeds S10000.000 the surplus
may be covered into the treasury to
pay interest on United States bonds
and for general purposes. This tax
should be y of l per cent. or | per cent.
per annum, as the Commission shall
elect. Power should be given to banks
| under permission from the Currency
Board to increase the note issue when
demand caused by unusual financial
emergency, such increase to be subject
to a tax (to be determined from time
to time by the currency boarD upon
the notes while in circulation. the tax
upon the notes to be at rate which
would put pressure upon the banks
to take up the notes when the emer
gency has passed. Silver and subsi-
uldfy COINS SfloulO OS TeueeffleQ III SOlu
by the United States Government when
demanded. These amount to about
0O,00OOO0 No notes should be is
sued for less than So.
National banks should be constrained
to exchange notes now out for new is
sue by slIrrendering notes as they re-
ceive them. Customs duties and taxes
of all kinds due to the Government
! HI IN,
two-thirds in bank notes. This is nee
essary TO supply the Government with
the gold required by it to pay inter-
est upon its bonds, redeem silver and
for other purposes.
The legal tender quality of gold and
silver should remain as now provided
by law, and they should be the only
legal tender except to the extent of
two-thirds of customs duties and taxes
due the Government, which should be
payable in bank notes as above stated.
Confer upon Currency Board power to
regulate the issues of bank notes from
time to time in lieu of the Government
currency retired and to authorize new
banks and branch banks to be estab-
lished when and where and with such
amounts of capital as the board may
deem proper and expedient with pow
er also to increase the amount of note
issue by the banks required for the
normal conditions of business as the
country shall grow in population and
in business expansion AS banking
capital may be increased by creation
of new banks the Currency Board
should have power 70 adjust the note
issue, whether normal or extraordinary,
between the new and old banks-no
distinction being drawn between them.
The 10 per cent. gold upon the note
issue deposited in the Government
treasury and the Is per cent. kept in
bank vaults should be counted as part
of the % per cent. reserve on deposit
in national banks.
The system Of celaring house certifi-
cate adopted by the banks in the large
cities in times of panic shall be legal
lied. They have proved to be most
salutary and there can be no better ev-
idence of the nseds of such a system
than the fact that it has been estab-
Iished by voluntary consent in times OF
panic.
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