Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-11-13
THE MONEY SUPPLY
No Immediate Necessity for the
Purchase of Bonds.
INCREASE OF BANKNOFB CIRCULATION
Matter May Be Taken UP at
Tomorows Cabinet. Meeting
WATCHING THE MARKET

The effort to persuade the administration
10 relieve the money market by the pur-
chase of bonds has not yet succeeded. Sec
rotary Gage discussed the subject at the
cabinet meeting on Friday. and then stated
that he was advised by leading bankers
that they had ample funds to care for their
regular commercial patrons, and that they
did not advise special action by the treas
ury. If serious representations in favor of
action have been made to President Nc
kinley they are likely to lead to some dis
cuSsiOn ut the cabinet meeting tomorrow
II is said at the treasury that only one
banker of standing has urged action upon
the department and that others have rep
resented that Ection was not called for at
the present time. The neglect of the great
majority Of banks to take advantage of the
offer Of the treasury to anticipate interest
payments Is regarded as an Indication that
the pressure of the banks for money is not
Intense. whatever may be the feelings of
the brokers and speculative borrowers. The
bonds presented for payment of advance
interest have thus far been about IL. per
cent Il the whole amount outstanding. The
coupon bonds thus presented have been
Hl4i4@2o and the registered bonds ST.. 0l3.-
2'E. making total Of 81. $50 120 The in
tereSt paid upon both classes has reached
HM1.143. and the rebate to the government
bonds outstanding on October II was 81. plf-
0i".'Eo. and tile interest which the treasury
mas offered in advance for a rebate IF two
tents OF one per cent month has not been
accepted To the amount Of about ST. ga
30 This indicates that many of thu banks
hoLdlng bonds de not care To pay 4-la per
cent year for money.
To Inerea~c the None, Supntx
There are some indications of an effort
to increase the money supply through the
fro Try-y-
the increase in the national bank note cir
culation during the last week and the de
mand for gold certificates. The bonds de-
posted to secure b5tukHotc circular ton dur-
Ing the week were 81 3,GJ 300 ana tbos.
Nitndrftwn as the basis for circulation were
SIbtInp, leaving a net gain on d.posft of
SlI"f,NFl The ISSUES Of gold certificates
reported Saturday Were $7S11sp on demos
us OF gold coin and 81. AZ go by public. dis
burSemenjS. which is larger than fo, some
Gays past The receipts through the, Gus
tom house and otherwise were s. S14 I1o
ne total issues of gold certificates since
august . have reached s1S51264 40 and
=. receipts into the treasury SSg041 0fo
The issues at New York on SATURDAY y-.re
S4.ppp on deposits of coin and s. S7S $50
IN disbursements. issues by way of dis
bursements We're $3.50 $50 at Washington
and $lfl.po at Chicago. The demand for
eeFlhcates is stiN chiefly in the form of
thoS- Tor twenty dollars. which Is the low
est i, nominal on allowed hv law Cold or
tIhcdtss are practically the only money ax-
Cept gold coin which could be. paid nut If
the treasury should decide either 10 in
crease the deposits OF public funds in the |
banks or to buy bonds. The bank .I.posifs
stood on Saturday at 81 $50 uIq This * |
about $l4.np,OOO less than the rnaxintIn,
attained after the issue OF the = per cent
i9ah' ana there Is a possibility that the
deposits Will again be allowed to advance
toward this amount. This subject and tina;
OF buying bonds will he discussed batva..1
the President and Secretary Gage if anv
4uFtAer acton : considered desirable
The Outstanding Ronds
Secretary Gage has been examining tie
facts regarding the outstanding bonds in |
order 10 be able to act intelligentIy if he
Should decide to go into the market. Those
bonds. which are already held by the treas
ury as security for bank-note circulation
ana public deposits, would not aid the mar
ket materially if they were purchased by |
the government Their withdrawal would |
compel the calling in of the deposits or the
reduction of bank circulation unless other
bonds were substituted. Nearly all the two
Per cent bonds are thus absorbed and
about thirty-five per cent of the NV
threes- The new tours which were. issued
to the amount OF S1G2. ns}.OGp. are on de-
post in the treasury TO the amount of only
SlAi:'2 go for bank circulation, and 81
S-+''S Tor public deposits The fiveS, which
mature earliest are on deposit in some
what larger proportions as the issue was
only $lH""~p but the amount is only
Si46I5G'0 for bank circulation. and s. 22l
UI TO secure public deposits. The old
fCurs. which mature in 1891, offer with the
fves as favorable conditions as any for
r-aking purchases by the treasury and
Will probably be the classes called if any
action is taken The amount Of these bonds
outstanding is So tT:I. loo. Of which Si29.-
GEI,NS are on deposit to secure bank circu-
laJiOn and s., IS. $50 to secure public de
p0sits. This leaves about $4Oo. pnO,6OO Of the
old tours in the hands OF private holders
and trust companies, some of which would |
ptobably b. attracted into the market by |
the offer Of the treasury to purchase at |
about the market rate
Watching the Market
Secretary Gage is watching the money |
market carefully and does not propose to |
permit serious suffering by strictly com
merridI interests. but he finds in the ap- |
prO@chiug meeting OF Congress a reason |
for delaying action unless it is absolutely |
required Congress is likely TO deal with |
thu monetary situation IN e comprehensive |
way, ana ~ provide for the conversion
OF outstanding bonds at certain fixed rates
i hy Offer 10 bay in advance Of this action |
by Congress would affect the market and !
might eTnarrysS the projects of CONVEX
sion Secretary Gage will recommend that |
legislation he enacted giving greater ffex-
lh-.ltF IN the bank note currency. There is |
some doubt whether such legislation Will |
= completed ana passed 10y both houses al
tn corning SerSi0u. hUt the -triugencv i'm |
some action v Mich seems to- me making an |
Impression on members Of Congress from
al! parts Of The country.