The sun. [volume] (New York [N.Y.]) 1833-1916, 1899-12-11
r,r SENATE RErUNDISe SCHEME

"a business throughout the country Ia 80
..,i,s that there Is little surplus currency to
..rd 10 this city for employment Conse-
.n.ntly. tho rates OF interest here are we'll
.aintaIned. and there is more inducement to
III .,octs than to buy them. The industrials
"a sspacially out OF favor. some OF them being
.r.,l,ble at any price. Even the best railroad
s,n,ts are barely Arm and show no symptoms
~ a, satly advance Nevertheless. they are
Iii from rve to twenty points higher than
49,, uere year ago at this time. and so are all
o,b.r frat.class securities.
Th. experience OF the last three months
t.monstrates the advantage OF having cur
s.nc, r,sldly confined to gold and Government
,o,A. and the mischief that wod,i nave re-
.rl,eJ from the elastic" bank currency adj
,ooa,ad In some quarters. The depletion ot
hank reserves. due to the demand for currency
N move the crops to market and the conse-
ou.nt contraction Of hank loans. while II has
s,nssd A great fall in the prices OF speculative
.,ocks has not inconvenienccd legitimate
bnsinsss nor led TO anything Ike panic. The
.h,lrkage NJ prices has been gradual and
hosIthy like letting of steam from boiler
,hrou,h An escape pre. instead NJ ho'tling
Vur until the boiler exrlodes Had interest
been kent down nv issues OF bank notes and
the prices Of stocks kent up to the level at
vhtch they stood last spring we should long
have shipped gold to Europe. and the coll
l.pse In stocks wouli have been sudden and
dis,s,rnus. with the Bank Of England rat" Of
discount nj per cent and that 81 III" Imperial
Rank Of Germany the same. nothing but hiEh
rates of interest hers has prevented London
and Berlin from drawing gold from IL.
Az all events. our present currency svs'cm
sce. no, exhibit any such CONSPICUOUS d"iects
az m cnl fo- radical changes in II. This Ia
yir,rsl'v acknowledged by the leaders ~ tho
dominant 0,itical party in the bills they have
proposed AZ the current session OF Com
rrasa The Government note issues. instead
Of being rstirei and cancelled. are to be Pc.
manenty retained. and their convertibility
into gold on demand Ia to he protected ny the
creation ola redemption fund not subject 10
imralrment by drafts upon II to meat ordinary
Government expenses. The notes Of the
national banks are still to bc secured nv de-
bosts 81 Government bonds. AMI the increase
IN their volume from 81 per cent. Of the rnr ~
Ii. bonds deposited to loo per cent will not
Re dangerous For some years ~ come there
fore the nation will have n currency which
vii, he both ample for its legitimate needs. and
absolutely safe.
The scheme for refundir the public debt
which the Senate Finance Commit tee has
AIDED to its currency bill has not yet been
discussed by the newspapers, aud how II will
b. received by the public Is not yet known.
ThA committee proposes that the Secretary OF
the Treasury shall have power to receive. lat a
valuation not greater than their pre,.p, worth
| q v.ld An incom- OF -, par cent Dor annum
any q, the Outstanding bond, OF the United
| States bearing interest AT 3 Der centum Der
anpum. payable Feb |. 1904; any OF the bonds
Of the Ia ted states bearing interest at 1 per
oentum per AMMAN. PAYABLE July. 1897. and
any bonds o! the United States bearing
interest AZ 3 per centum per apuum. payab,s
Aug l. lg-," and 30 give in exchang.
| therefor bonds bearing . per cent
| interest PAYABLE quarterly, the prtncpa to
be payable a, the pleasure OF the
Cnited s,Ates after thirty y.a-. from, the data
Of their issue Both interest and principal arc
70 30 paid IN gold coin OF the present standard
value" and the tond. are TO be EXEMPT from
oil kinds o, taxes The three classes Of bonds
specified amount. in the aggregate, to $3.50
10000 At mar and To $3.50 900 800 AT their
present. market price. which is based pretty
| tarly upon 2G per cent valuation, The
rev bonds are also to he ava liable a. security
Eiheir par value for nat ional bank currency.
The bill makes no proyi ION Tor raying conn
MISSIONS TO the Intern diaries In the exchange
proyosed. as did the Rciund!ng act OF 1870
That act appropriated "a sum not exceeding
ene-half OF one per cent OF the bonds herein
suiOIlEtu " IuJ lHr expense OF preparing,
issuing, advertising and disposing Of tho
sane" Cnder 1t bonds to the amount AT par
Of 100000 were disposed OF in 1877
1915 and 1879, the amount in 1879 having been
nearly SJO.OOO,ODO. The bankers who man
| aged the business mad. besides the
commission owed by the act. which
was si225 900 10, less the cost OF engraving
printing and Advertising the bonds a large
profit by purchasing millions o! dollars Of
them outright or firm" az 1t was called. and
Ie's"lling them 10 the public at premium.
There was great scramble among them for
the bonds. and charges o. favoritism were
freely made against Secretary Sherman for his
t!otments Of them Certain II IL. that he
directed the Controller OF the Currency not
benforce the provision OF the National Bank
act requiring the - per cent. lawful money
reserve against deposits, IN cases where ma
tona banks had agr, ed 70 taketh new bonds
AMI had given tho Government credit on their
books for the amount due to It. while they were
selling the bonds or eIchans I'M. them for those
called for red emption One bank, particularly,
bought many millions OF the bonds without
q inn al