The morning news. [volume] (Savannah, Ga.) 1887-1900, 1897-11-15
HORACE WHITE ON MONEY.
cIEAR-CUT ANSWER To THE MON
ETARY COMMISSION.

Advocates Retirement of the Green
hacks and the Adoption of an
x,Iostic Banking Currency Based
Ynon Rusiness Assets-ThinIs Sill
rer Dollars Should Be Redeemed
IN GoId-SiIver Dollars Regarded
AZ Metallic Greenbacks.
Nvasbjngton, Nov. 14.-Horace White,
rbosa book upon Money and Banking"
hos attracted so much attention, has sub
v,itted some clear-cut answers to the in
terrogatories of the monetary commits
sion. regarding improvements in the cur
rencv system of the United States. Mr..
White is an outspoken advocate of the re-
tirement of greenbacks and the adoption
of an elastic banking currency, based up
on business assets. He declares that the
silver dollars should be redeemed in gold
and that in a financial sense, there is no
difference between the several forms of
government fduciary circulation, of which
silver dollars are part.
THE latter" he declares, ''are metallic
ereenbacks." He does not believe that the
amount of circulation presented for re-
demption would be any greater than at
present if silver were redeemable in gold.
an answer to the questions regarding the
maintenance of the gold standard, Mr..
White says: 81 would recommend the re-
demption. retirement and cancellation of
all legal tender notes, as a first step.
Probably the silver certificates and silver
dollars would thereafter remain at par
with gold, like the outstanding thalers
of Germany, and would not be presented
for redemption in any considerable amount
being needed, like the smaller silver coins,
for circulation in retail trade. After the
retirement of the legal tender notes we
should be able to see better what to do
next"
Question-For the purpose of facilitating
the use of existing silver currency, what
do you recommend as the smallest denom-
inaton of United States notes and bank
notes which should be put in circulation?
Answer-Ten dollars at first, but this
should be made a matter of experiment,
the object being to determine the dimen-
sons of the field of circulation which will
absorb the silver currency, leaving the rest
10 bank notes.
In regard to the legal tender notes, Mr..
Whites responses are as follows:
Question-On what ground if any, would
you favor the gradual but entire with
drawal of the treasury notes of 1890, and of
the United States notes?
Answer-On the ground that there is no
certainty, and can be no certainty that the
government will always redeem them in
gold. Redemption or non-redemption is
political issue to be fought over an cleo
lions and must remain so as long as this
kind of paper is outstanding. More I'M
certainty is always a drawback to busi-
ness prosperity. Failure of redemption
would be bankruptcy. public and private.
Question-If it shall be decided to retire
L. L.
1t be done without adding to our bonded
debt?
Answer-By cancelling all that are re-
ceiVed at the treasury for taxes or present
ed for redemption or all so received over
and above the governments necessary dis
bursements.
Question-How, In that case, can pro-
vision be made for maintaining an ade-
quate amount of currency available for
purposes of business?
Answer-Provision will be made auto
matically in various ways, viz: First, by
retaining the gold produced by our own
mines; second, by importing gold from
abroad; third, by the issue of national
bank notes. Prior to the civil war, the
government gave itself no concern about
providing currency for purposes of busl-
ness, yet the supply was never deficient.
Question-If 1t be thought inexpedient
to fund the United States notes how can
they De redeemed WIN an assurance ludl
bank currency will take their place?
AnsWer-The assurance is found in the
fact that in every case where a currency
vacuum has existed it has been filled by
bank notes. This was the case in the
panic of 1898. The process of taking out
notes might be made more expeditions.
That is a matter of machinery and of legal
regulation. 1t Is perfectly certain that If
there is a profit in issuing bank circula-
ton, it will be issued. If there is no profit
in 1t, we must conclude 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 notes
issues, because OF the extinction of the
public debt. In reply to the question
whether any safe and practicable plan can
be devised for using other securities, he
says that he thinks not.
He believes that 50 per cent. of the paid
up and unimpared capital of the banks
should be the limit of the note Issues and
that a cash reserve should be held for
ed by law for deposits, viz: Twenty-Five
per cent. in reserve cities, and Is per cent.
elsewhere, with the right to keep three
fifths of said Is per cent. in the reserve Cit
les There is no difference between deposit
liabilities, so far as the bank itself is con-
cerned, and no reason why the reserve
should be greater or less for the one than
for the other. The reserve should consist
of gold and should be in the vaults of the
bank or in a clearing house depository.