The evening herald. [volume] (Shenandoah, Pa.) 1891-1966, 1897-01-29
ON CURRENCY.
Gives His Views Before the House
Committee on Banking,
NO CONTRACTION Would FOLLOW

The Retirement OF the decentralization.
proved Credit More Important Than
Moro Monoy-Necessity Of Ceasing the
Government Issue Of Credit Notes.
WASHINGTON, Jan 29-The comptroller
Of the currency, Mr.. Eckels, yesterday
gave his views upon the financial condi
ton of the country to the house com
mittee on banking and currency. Seyera.
bills introduced by members of the house
mad been referred to Mr.. Eckels for his
Judgment, and he anulyzed those, beside.
giving his viows upon The money question
iB general.
Mr.. Eckels said: while there was nc
doubt of the necessity for changes in The
governments financial situation, the pub.
lie was disposed to attribute too much of
the existing troubles to the lack of none.
tary egislation. The day was past when
the volume of money was It's most impor
tant factor. Improved facilities for trans.
portation and methods Of exchange had
lessened the importance Of a large volume
Of money. Improved credit was more i'm.
portant. The first essential I'm this coun.
try was the stability Of public credit The
apparent reluctance Of the people Of the
United States to redeem their public obli-
cations was the chief Of distrust
THE current redemption Of the demand
obligations Of the government is the
chief problem Of the treasury. So far as
the contraction Of the currency is con.
cerned, 1 do not think 10 would follow the
gradual retirement of the greenbacks,
provided credit was reasonably stable.
Banks would supply the needed currency,
or gold would come from abroad. The
mn rprr . Of CaowoA,w- NTaUaT1--Lf- -
icy would have disposed Of the question.
Any business man who constantly re-
deems his notes without retiring them and
keeps them out constantly will come to a
settling day that will break him.
THE chief feature of a banking bill
would be to take from the government
the issue Of credit notes. The banks can
do this. Banks conducted on practical
banking principles instead Of speculative
principles could satisfy the currency
needs Of business. Before the war the
banks had always furnished sufficient
gold for business"
In the course Of a discussion of the war
conditions, Mr.. Eckels gave the opinion
that the government might have main
tanned gold payments throughout the
war, and said that Senator Morrill, be-
lieved the issuance of the %greenbanks had
greatly increased the cost of the war.
Recent disturbances had been due, Mr..
Eckels asserted, to the distrust aroused by
the policy, first, of stamping a trade dol
lar as 100 cents when it was not worth that
without something behind it IN the adj
dition of tho Sherman law. The repeal of
the sherman law, and the recent election
against free silver, with the unusual for
eign demand for breadstuffs, had restored
] nominal a,nIftf,,r tn,t g. ne ,,A- d.. go.
ditions arose which created a demand for
800, 900, 900 of gold, that gold would be
drawn from the treasury.
In reply to a question from Mr.. Cox, of
Tennessee, whether there was any obiec.
ton to the use of the g~reenbacks rs a basis
of banking, Mr.. Eckels said: ''That
would be imprlsonment for life instead of
direct execution. Under such a system,n
he added, 'if a bank went out of business
or contracted its currency, the govern
ment should redeem the notes. Bonded
securities were payable on u certain date,
but any banking system based on them,
any system which based the volume of
currency On anything but the needs of
business was erroneous"
Mr.. Cook, Of Wisconsin, inquired why
the endless chain" process had not oo.
CURED during the fourteen years begin.
ming with 1893 when the government was
buying so much silver. The explanation
Mr.. Eckels gave was that during these
years there were only $3.50 .O0j of obli-
cations in The public mind redeenable in
gold, while last year there were 1855, Co.,
900 more.
Referring to the bond issues by the pres
emit administration, Mr.. Eckels said "Tho
government should not be put in the posi-
tlon of a mendicant asking aid, nor should
1t be at the mercy of huanciers. No gov
eminent can base its financial system on
patriotism"
Mr.. Newlands asked whether there was
any debtor nation that was able to keep
its uncovered paper money at par with
gold. To this Mr.. Eokles replied that he
knew Of no such case except the United
States, but maintained that they could do
so If the paper was issued by the banks
instead of the government.
In reply to a question Mr.. Eckels said
that in his opinion there is sufficient gold
in the world TO meet all demands if prop
erly used 1hore is about 500, 600, 600 Of
gold in the Uuited States, much Of which
had been In safe deposits until after the
election.