The sun. [volume] (New York [N.Y.]) 1833-1916, 1898-07-18
rnr couNrnrs srocK 81 moNsE.

Kit thIll INAN vi AaHN WNN-N NNa
the Siege OF Santiago. tho Interpretation Of the
now Revenue act, and the progress OF the Gov
ernmont war loan. tho tendency OF the market
was downward. On Thursday. however. came
simultaneously the news Of the surrender OF
s~nntiaCo, and OF the trium plant success OF the
loan. while the embarrassing questions arising
uuJer the Revenue act had mostly been satls-
iactorlly settled. Tho consequence was, a re-
vival OF activity. and a slight advance In prices
which. however. was not sustained. aud dull
ness again resumed It's sway. WIZ this should
be. in view OF the certainty OF q speedy cessa-
ton OF the war with Spain. Is one OF those puz-
Eles which nobody can explain. Il must DO
charged to the perversity. or. as DR.. johnson
called II, the "anfractuosity." Of the human
mind. which so often dlsappoints expectations.
A large part OF the new loan will. II Is ex-
pected. find It's way into the possession OF
national banks. TO be used by them as the basis
OF an additional Issue OF circulating notes.
Certainly. the banks can AFFORD 70 pay more than
any other purchasers for the bonds, because.
even at a premium Of 3 points, they are moro
desirable for their purpose than the other Gov
ernment issues. the cheapest OF which sell at
10. The National Bank actallows circulation to
be taken out only to the amount OF 90 per cent.
OF the par Of the bonds deposited as security for
Il. without regard to their market value. so that
n bond at 1903 10 Just as useful as O basis OF cir
~culation as one at ITO. and involves the tying
up OF 7 per cent. less capital. Already. IL IL
said, some national banks have put In requisl-
tons for supplies Of new notes. and. II
they have not got the bonds for them by
subscription. they win have to buy them
from applicants to whom they are allotted
at par. Undoubtedly. many Of the subscribers
for the $500 bonds, to whom the Secretary Of
the Treasury has given a preference In the
.tot,,a,F . oIthar dunnmfaA f0r fha haDka
or will sell their bonds to the banks as soon as
they get them. The fiction that the S90.o00.000
OF such bonds reported as having been sub
sorIhed for will 20 into the hands OF small cap
italtsts for permanent investment. Ia not ac-
copied by any sensible person. In fact. Il will
probably turn out that the whole S~200.000.o00
has really been taken for the benefit OF the
same purchasers who would have taken It II It
had been offered for public competition In the
usual way. and that all the benefit OF the new
method has been reaped BY little SPECTATORS.
who will seiso the hrst opportunity to capture
Tor 8 poinos premium on their allotments.
Under any conditions. the imitation Of the
volume OF the countEy's currency o tmpend-
ing would lead to Q corresponding imitation Of
the prices Of property and commodities. and
following. 40 IL Will. Q great imitation pro-
duced by other causes, its effect will DO the
moro certain. In October. 1893. the total OF
our circulating medium. embracing gold coin.
standard silver doIlars and paper money Of all
kinds. was estimated by the Treasury Depart
ment at 81 .7G1.93e.918 On the first day OF
this month the Same total was reported by tho
department at S1.e 43. 435. TAG. showing an In
crease In less than Ave years Of $l42.4 e5 .831.
OF this increase about S23.000.O0o has been In
national bank notes, the remainder having
been gold coin. imported. mostly during the
I.nk raar In pavpoapt fop onr ARnorfa ~ NafrO-
leum and agricultural products. II now we
add TO the general mass say $780, 1000 In
national bank notes. We shall swell the increase
to S242.0 100000.
This. let IL DO remembered. Is the increase
only in money Ia the shape OF coin and notes.
The item OF bank deposits. which are credits on
the books OF the banks against which checks
are continually drawn and which. for the great
majority Of transactions. serVe as actua! money.
had increased. according ,o4.he Comptroller Of
tine Currency's latest report. from S2.172.312.-
6&7 IN October. 1899. to S~2.5lO.612.217 in o.
tober. 1897. or. 1891. 290.87o. Since that date
they have increased still further. the deposits
Of the New York banks n,ono. which on Oct. /.
1885,. were $500, 1a5. 800. having risen on Oct,
]. 1897. to SGle. 353.2 200. and. last Saturday. to
676S.OC0.00O. 1t thus appears. that. while the
Solume OF what is popularity called the coun-
trT's money has increased since October. 1893.
by only S142.4e5.S 31. that OF bank credits.
which are equally efficient in raising prices.
has increased nearly $7~Oo.OOo. GOO.
part OF this increase OF bank deposits 10.
indeed. actual coin and legal tender notes, but.
After allowing S~lOo.ooO.0Co for this item. there
will still remain an increase OF bank credits,
pure and simple.o OF $~6OOIOOO.OOO. This fact 10
Of the utmost significance in view OF the clamor
raised by the silverites. and By some oithe So
called currency reformers. that there II not
enough money In the country to meetthe re-
Quirements Of trade. and that. therefore, the
supply OF It ought TO DO augmented By the free
coinage OF silver and By the removal Of the
present obstacles to an unlimited issue OF bank
circulation. For local use. bank checks serve
every purpose that could be served by bank
notes. man whose credit In his " neigh
borhood Is not good enough to have his check
accepted In place OF money will not be helped
by any Issue OF bank notes. and q bank. checks
upon which are diatFuBted. ought not To be ale