The sun. [volume] (New York [N.Y.]) 1833-1916, 1899-10-16
,uE pouLRS or THE TREASURY.

III.
,,n,,anI Including July /, 1900. The amount
~ o,,gey thus to bo released from tho Treas
,,,l rs small COMPARED with the contraction Of
i,rk l1uns which has been going on for the
,os, few months. but tho assurance OF us
coming had an invigorating effect on tho
.. market, which not even the outbreak OF
t,.t.,.c, between the British and the Boers
In South Africa could entirely counter
A.. In March our New YORK banks
,,rc showed deposits OF S'O''u'''-
CJl loans OF SISO.uOO,OOO ana Ia"-
IN, money reserve 81 S2ii,Voo'o1o' LAST
e,,p,.r,y their deposits had fallen to slI1.-
I','n, ,rnir loans to S7O6. 900, 900 and their
r,..t,Sl05.OOOOO 900 Evidently. the dis
.,rss,,..ut by tho Treasury OF few millions
:, u,r. A large part OF which will ilnd its
slowly into bank vaults. will not nearly
.n,,rers,'s for these shrinkageS. ana
,,ra,. Il 10 reinforced by Suppiles from
sr.olrcrs it will fail to restore tho ioVel OF
,ic.a in the stock market which prevailed iast
icing Besides the Treasury Is all inc wh'ie
.,sorbing money from circulation as ""H as
,,vIru IL back, md the indications at present
,,a that 1t will thus. for the next rev weeks
,alsinas much as 1t lets out IL not mort"
ma Ir,cr.tt due Nov |. amounts TO about
",",no and that for the remainder of
81. s.cal wear. payable with rebate. to ABOUT
sNrnuDuuO whereas tho Treasury recelrts
.ooysr 81 100000 day. and are more hkeIS
:, Increase than to diminish.
The order for the prepayment OF interest -
made bv the Secretary OF the Treasury under
an net authorizing it, AZ ugoVeu malch l. ,N'f'
This. however. is the least lh''"''"nl ~ Wv
,ovcrs he possesses TO use HoHorhmeh tunus
Tor tho relief Of the money market, By aecuon
15o,ths National Bank act. he 10 empowered
todssirna,c associations organized uhuer tha'
act n, lrtositoriss Of public money except re-
cnipts from customs under such r'Ru a''ons
M he may prcscrbe. This provision uosS no,
allow. y. /. sometimes said. the Withdrawn
from tho Treasury OF money once PAD INTO 1t.
h,, n,erev the tenn porary deposit IN banks OF
r.c.ipts. except from customs. on their way TO
the Treasury. In pursuance OF H. various ma
tlonal banks now hold SN2,N"'oOo belonging
IN the Government. mainly proceeds ot last
wears bond sales and to It may be aun'o iur-
ther collections Of Internal revenue not heeueu
foriumediats
Norsoyer. by the act u,ssei Feb %. lSi2,
making tn. duties n Imported goods payable
exclusively in coin. tho coin so paid was desg-
n,tad as a speciai fund to be nrphcd first, TO
y tho parment in coin OF tho interest on the
bopds o,the United States and, second. to the
purchase or payment Ct ! per cent, each
fiscal year. Ct the entire debt OF the United
-.
the subsequent act OF July a. 1870. 1t was d.
rerted that the bonds thus purchased for tho
sipkipg fund should be cancelled but that an
amount euual to the interest on them should
be used in purchasing more bonds for the sink
ing fund The execution OF the provision for
H.. sinking fund was not begun until early in
1899. when. for that fiscal year. the amount OF
bonds purchased IN accordance with it was
SSFll 900 For the next ten years the amount
averaged about Il ! 300. 900 a year. and as soon
ns the r.iunding operations OF 1879 were COM
plotted It rose 70 S73,G52 900 in 1880. S74,37l.-
boz in 1884. $hOO79.0 900 in 1891. and there
after. until 1882. it averaged considerably
more than $toO))O)0 year In IL " tho
amount dropped 70 S2f.3lO.OOO. and then.
owing to the deNcitn the revenue applicable to
the purpose. it ceased almost entirely. leaving
The grand total Of purchases $Sl5.OOOOOO at
rtr. the cost OF which IN currency was nearly
HSjO,wOOOO. At the average OF S4OOOO,OOo
year which the law calls for, there are now ar
rears due to the fund Of $3.50 100000. any por-
tion OF which the Secretary Of the Treasury has
the right to pay out OF its surplus.
In addition to these provisions for the pur-
chase of Government bonds for the sinking
fund. rider was attached 20 the Appropria-
tion act OF 1881. by which it was enacted that
the Secretary OF tho Treasury may al any time
otherwise appropriated. or 50 much thereof as
he may consider proper. to the purchase or re-
demption OF United states bonds prorided.
that the bonds so purchased or redeemed shall
constitute no part Of the sinking fund but shall
be cancelled" Under this rider" SSO2.OOO-
600 OF nerest-bearinC bonds ware purchased.
between 1881 and 1882. besides those pur-
chased Tor the sinking fund. reducing the total
amount ot bonds outstanding from s.. 2O2 OOO.-
GOO in 1859 to SJSI. 100000 in 1892 Secretary
1alrchld. when he took office in 1887. doubted
the continuing force OF this provision. but
h'srward no recognized it. and ito validity is
how well established
The foregoing provisions Of law. it will be
observed. all confer power on tho Secretary OF
Tho Treasury to relieve, with public moneys a
stringency in the money market and how often
they have been used for this purpose is well
known. 1t mot so well known. however. that
other provisions exist. mpowering him to tax Q
IN oppos't" course and to withdraw money
from circulation into the Treasury vaults.
ior example. the act OF March II. 1862. pro-
woes that the Secretary may purchase coin