The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1897-10-30

direct redemption simply olfnd TOUR IN
which the note might get side-tracked.
or switched off into years Of usefulness
before reaching redemption station?
was IL not be cause the enormous ex-
penses OF, and consequent debt from,
the civil war, and the uncertainty Of it's
period and final outcome, impaired our
credit SO that the United States per
cent bonds were at a discount, and there
was quite a serious doubt whether such
bonds even with a ten per cent mar
gin in excess OF the notes, and a re-
demption fund in Washington, were am
pie security without adding the promise
OF the banker, his assets and financial
ability?
tine successfuI issues Of the war: the
early demonstration Of our ability to re-
cover from it's effects, and to rapidly re-
duce the war debt OF two thousand sew
en- hundred millions, soon carried our
bonds far above par, and the possibly
iustifiable original precaution Of incor-
porating into our currency the banks
promise ID pay became utterly value
less.
The bankers promise, however, would
have become equally valueless IL the
war mad gone against the north. Either
the bonds would be good for the notes
or they would not. II seriously not, the
sarinkage would have hopelessly Grip
pied the bankers: and in proportion as
the bonds ceased to be ample security
for the circulation 50 the value of the
bankers added promise would have fad
Ell away.
''Second-If the experience of the last
thirty-ffve years has demonstrated that
a circulation based upon government
bonds is safe and convenient; that such
currency does not require for its eafety
the promise of the banker; that II does
not seek redemption even in times OF
severe panic; that it passes unchalleng-
ed in any corner Of our country under
any possible conditions; that il is just s
good after the bank whose name it bears
and whose promise 10 pay it is, has fail
ed; why should We not confidently adopt
for our every day domestic uses a SIM
liar currency, modified, however, from
the present national bank currency in
these particulars: The foundation bonds
Should not bear over . per cent per an
mum interest, which, as explained here
after. would keep them at par and pre-
vent them going 10 a premium. They
would run for twenty years, because it
is more than likely that by that time the
reduction in our pension disbursements
will justify reduction Of our debt. 1t is
justifiade 10 take advantage Of a ma
tionsl debt to secure and guarantee a
circulation, but IL would be questionable
policy to create such a debt for the pur-
pose Of underlying a currency, or to
continue a debt beyond the period OF its
necessity. The currency should not be
made up Of the promise of several thou
sad more or less scattered and obscure
banks, whose promise does not add in
the least to the absolute security of the
government bond. but It should be in the
form Of United States government GER
tificates. of the usual currency denomin-
atoms, that they are the representatives
OF. and are secured by, government gold
bonds, dollar for dollar, deposited for
their ultimate redemption. They should
not be in denominations of less than
$500, SO as to provide an increased use
for our superabundant stock OF silver.
This would be practically a mobiliZa-
ton for the public good of a large
amount OF fixed wealth; the same as
was done by permitting national banks
TO issue loanable circulation against the
high interest bonds which the exigen-
cies of the war and our impaired credit
made necessary. Conditions have
changed very materially, and while
hardly one of the then wise provisions
OF the national bank act are suitable or
necessary for the present situation, yet
the fundamental principle Of a domestic
circulation founded upon and absolutely
secured. dollar for dollar, by national
bonds, is as sound today as it has proved
TO be during the thirty-five years in
which the rational bank notes have been
the one form Of our currency which has
given US no uneasiness whatever.
Among the numerous influences
bearing upon every question it is diff
cult to determine their relative force
and weight in moulding public opinion.
and prejudices once formed, and per-
haps justified. often retain their
strength for years after conditions have
changed radically.
IN the early days OF the national
banks when. 3 pep cent and per cent
bonds could be secured at from SO per
cen. TO par, and when circulation is
sued thereon could be loaned at high
rates. large profits were possible to those
who had the means and ability for the
business and more willing TO take the
risk OF buying bonds which might de-
preclate- -.-....-.-..-.
When the establishment OF the gov.
ernment's credit by the rapid reduction
OF the debt carried the bonds 20 high
premium, while the wonderful develop
ment Of our. ,Tatural resources MAIN
tained high rates for money. it was not
unnatural that the large class which.
from lark OF means or from disinclina-
ton. had not gone into banking. shoul
look with jealous disf3vor upon the
large p-otits Of the bankers.
Time and changed conditions. which
no longer make national banking excep-
tionally profi;aole have modified the
original opposition, bur the popular pre-
JUDGE is still ysy strong against grant
ing addidonal Advantages or exclusive
privileges 10 What have been looked up
on as favored Institutions.
The war debt II the extent OF about
81. 1o0. 600. 900 was funded into per cent
and per cent bonds. but for various
reasons and under frequent and vary
ing legislation extending from 1852 10
1878. about SS4s o0).o00 OF the war debt
has been lef; unfunded. While this pol
icy was open 10 serious question. the
demand no,es for this large sum have
apparently furnished useful form OF
currency. and were maintained at par
without anxiety or unreasonable ex-