The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1897-11-15


washington, Nov. 14.-Nr. Horace
White. whose book upon Money and
Banking has attracted so much atten-
ton, has submitted some clear-cut an
sweIs to the interrogatories of the
monetary commission urging improve
ments in the currency system of the
United States. Mr.. White is an out
spoken advocate of the retirement of
the greenbacks. and the adoption Of an
aelastic banking currency, based upon
business assets. He declares that the
silver dollars should be redeemed in
gold, and that in q financial sense there
is 20 difference between the several
forms Of subsidiary circulation, of
which silver dollars are a part.
The latter. he declares, are metallic
gTeenbacl1s. He does not believe that
the amount Of circulation presented for
redemption would be any greater than
at present if silver We're redeemable in
gold. In answer to the questions re-
garding the maintenance OF the gold
standard. Mr. White says:
HIS FIRST STEP.
81 would recommend the redemption,
retirement and cancellation of all legal
tender notes as 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 Go next"
Question.-For the purpose of facil-
itating the use of existing silver cur
rency. What do you recommend as the
smallest denomination of United States
notes and bank notes which should be
put into circulation2
Answer.-The ten dollars at first. and
this to be made matter of experiment,
the object being to determine the di-
mensions Of circulation which WIZ alb
sorb the currency, leaving the rest to
bank notes.
LEGAL TENDER NOTES.
In regard to the legal tender notes,
Mr.. Whites views are as follows:
Question.-Qn what grounds. if any,
would you favor the gradual. but entire.
Withdrawal 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 viii always re-
deem them in gold. Redemption or
non-redemption is a political issue. to
be fought over in elections. and must
remain, SC long as this kPd OF paper
Is outstanding. Mere uncertainty is al
ways d drawback to business prosper
tty. Failure Of redemption would be
bankruptcy. public and private
of 1t shall be decided to retire the
United States notes, how can it be done
without adding to our bonded debt?
RECEIVABLE FOR TAXES.
A.-By cancelling ali that are received
at the treasury for taxes or presented
for redemption; also all received over
and above the governments necessary
disbursements.
O.-Row. in that case, can provision
be made for maintaining an adequate
amount of currency for purposes of
business?
A.-Provision viii be made auto
matically liz various ways. viz: First
BY retiring the gold produced by our
own mines. Secondly importing gold
from abroad Thirdly the issue of
national bank notes. Prior to the civil
war the government gave itself no con-
Germ about providing currency for pur-
poses of business, yet the supply was
never deficient
Of it be thought inexpedient to
fund the United States notes. how can
4hev be redeemed with an assurance
that bank currency viii take their
place?
A-The assurance is found in the
fact that in every case where a cur
rency vacuum has existed. it has been
1led by bank notes. This was the
case in the panic Of 1895. The process
of taking out notes might be more ex-
Deditious. That is a matter of ma
chinery and Of legal regulation. 1t is
perfectly certain that if there is a
profit in issuing bank circulation, it
will be issued. II there is no profit in
IL we must conclude either that the
law needs amendment. or that the de-
mand for currency is slight.
PREDICTIONS.
Mr.. White believes that in process Of
time it viii not be possible 10 rely
upon national bonds as security for
bank note issues, because of the eX-
4inction of the public debt. In reply
TO the questions whether any safe and
practicable plan can be devised for
;isine other securities, he says that he
thinks not.
Il should not like TO be charged with
the responsibility of selecting the Sc
curities or choosing between the diff
ferent kinds offered.
He believes that 50 per cent of the
paid-up and unimpaired capital of the
bank has been the limit Of the note
Z, issues and that a cash reserve should
be held for the redemption Of others
the same as now provided by law
for deposits, viz: % per cent in re-
serve cities and Is per cent elsewhere
with the right to keep three-ffths OF
the said % per cent in the reserve
cities There is no difference between
deposit liabilities and note liabilities
so far as the bank itself is concerned
and no reason why the reserve should
be greater or less for the -one fhan for
the other The reserve should consist
OF gold and should be in the vaults OF
the bank or in a clearing house de-
pository.