Kansas City journal. [volume] (Kansas City, Mo.) 1897-1928, 1897-11-15
REGARDED AS THE FIRST STEP
TOWARD CURRENCY Reform.
Declares That Silver Dollars Should
De Redeemed in GOld-FavOrs
Withdrawal Treasury Notes
of 1880 and United
States Notes.

| OF the SreenbackS ana the adoption OF an
| elastic banking currency based upon busi-
resS assets. He declares that the silver
dollars should be redeemed in gold. and
| that. in a financial sense, there is no differ
| ence between the several forms of tidicuary
| circulation, OF which silver dollars are a
| part. The latter he declares, ''are me-
| talic greenbacks." He does not believe
| that the amount of circulation presented
| for redemption would be any greater than
at present if silver were redeemable in
! geld. In answer to the question regarding
| the maintenance of the gold standard. Mr..
White says:
Il would recommend the redemption, re-
| tirement and cancellation of all legal ten
der notes as a first step. Probably the sill
Yer certificates and silver dollars would
| thereafter remain at par with gold, like
the outstanding thalers of Germany. and
would not be presented for redemption il
! any considerable amoun. .abeing needed, like
the smaller silver coins.~or circulation IN
/ After the retirement of the legal tender
notes we should be able to see better what
For the purpose of facilitating the use
| OF existing silver currency, what do you
recommend as the smallest denomination
| of United States notes and bank notes
which should be put into circulation?'
Zen dollars at first, but this should be
being being to determine the dimensions of cir
cLlation which will absorb the currency,
leaving the rest to bank bank, notes; o3o. n,,.s Mr.
| Whites views are az follows:
| He believes that 50 per cent of the paid
! should be the limit of the note issues; and
| that a cash reserve should be held Tor
| the redemption on other. The same as
now provided by law for deposits. VIZ, %
| per cent in reserve cities and ID per cent
| elsewhere. with the right to keep three
tifths of the said 10 per cent IN the reserve d.
! pcsit liabilities and note liabilities, so lar
| as the bank itself Is concerned, and no
why fh the a for the ohe
| The reserve should consist of gold and
| should be in the vaults of Il bank or IN
clearing house depository.
| Other questions regarding the best plan
| for establishing and regulating banking
currency are answered by MIR. White as
| follows: ..
| I'm general 1 approve of the plan adopt
ed by the American Bankers Association
at Baltimore re in 0et06eT nIan ISs All bank
| notes should be redeemable at the CONNER
| cial center of the country. and also at
should be made of the Pacific coast ON
| account of the distance. The requirement.
| of redemption at the banks counter was
| found to work no hardship under the Suf-
folk bank system. since as much specie was
| oustomarily deposited in the country banks
| as was called for by depositors or note
holders. .,,s ,.,,, In
| vor the gradual but entire withdrawal of
the treasury notes OF 1s9o, ana o1 the ohie
| ed States noteS?"
ION the ground that there is no Ger
| tainty, and can be no certainty, that tne
government will always redeem them IN
gold Redemption or nOn-redempbon IS
political issue to be fought over In elections
and must remain so as long as inns k,,tu 9l 3l
paper is outstanding. Mere uncertainty IS
| always a drawback to business proprlety.
| Failure of redemption would be bankruptcy
public and private" ,,.o,
| States notes, how can 1t be done without
adding to our bonded debt?"
BY cancellirg all that are received e dsn ds nne
governments necessary disbursements.
| How in that case can provision be made
for maintaining an adequate amount Of
| currency for the purposes OF business:
Provision will be made automatically IN
| gold produced by our own mines: e, by i'm
| porting gold from abroad: t0 by the issue
| Of national bank notes. Prior to the civil
war the government gave itself no concern
about providing currency for purposes or
business, yet the supply was never den-
| cient."
| United States notes, how can they be re-
deemed with an assurance that bank cur
rency will take their place."
The assurance is found in the fact that
in every case where a currency vacuum
| has existed it has been filled by bank notes. .
he she Of aknK out might b.
more expeditions. That is a matter of ma
| chlnery and of legal regulation. 1t is per-
1eCtly certain tTdt IL tHtIc lS pl ohl III
Issuing bank circulation it will be issued.
| If there is no profit in it. We must con-
| clude either that the law needs amendment
or that the demand for currency is slight"
Mr.. White believes that in process of time
it will not be possible to rely upon national
| bonds as security for bank note issues. be-
| cause of the extinction of public debt. In
reply to the questions whether any safe
and practicable plan can be devised for us
sheHd not ike Ike to be W
| the responsibility of selecting the securities
| or choosing between the different kinds Of
What. if anything. beyond provision for
immediate redemption. is needed for secur-
ing the elasticity Of note issues in periods
Of normal business?"
Ability to issue notes promptly is as
needful as prompt. redemption
In times of panic or sudden strnsency.
| how would you provide for additional is
sues by the banks. to enable them to con-
tinue discounts and prevent commercial
distress?"
cent of the banks capital. conditional
upon the payment of a tax. at the rate of
s per cent per annum. to the government
| as long as the excess of notes remains
"Of what should the banks reserve con-
sist?"
cold"
should any national bank be permit
! ted to pay interest on the current deposits
of other banks?"
Il see no objection thereto. The question
| is eminenty one to be answered by the eX-
perience of the past thirty years. during
which time the practice has existed.
Should deposits of country banks in re-
serve cities be authorized to be counted
as part of the required ressrve?"
Yes. to the extent of three-fifths,
the law now provides. This provision is
the result of experience. believe. and
ought. therefore. to he accepted as set
ted
What should be the minimum capital for
capital banks?"
Il am inclined to favor the present limit
of $50. COO
Should the existing 10 per cent tax on
state bank notes be repealed?"
I'm the negative
Should any national bank be permitted
to establish branches under its manage
mert?'
Il see no objection thereto"
If so. under what limitations, if any"
81 would allow any bank having a paid
up capital of not less than 81 10000 to cs-
tahlisl branches in its own state and any
bank having a capital of s.. 900. 900 or mere
tc establish branches in any part of the
United States. I would allow notes to be
issued only by the parent banks. although
they might be issued to and paid out by the
branch banks, in the usual course of busi-
ness.
DR.. COllyeT to Remain in New York.
New York, Nov A.-Dr. Collyer. who has