The morning news. [volume] (Savannah, Ga.) 1887-1900, 1899-03-27
DEMAND FOR SMALL BILLS.
TREASURER ROBERTS CALLS 1T A
SIGN OF PROSPERITY!

Take Gold in Exchange for Small
Currency-Lnrge Notes should BE
Converted Into Notes of Smaller
DenominatiOns-T National Bank
Note Circulation DecIining-Leg-
isIation Needed.
Washington, Marcb 26.-(speciaD.-An
intense pressure for small paper
currency is anticipated by Treasurer
| Roberts at the time of the crop
moving next autumn. This pres
sure is already such that the treasury is
constantly refusing toovsupply paper cur
rency in exchange for god deposits at New
York and is directing assistant treasurers
to nav gold whenever possible over the
counters of the sub-treasuries. Treasurer
Roberts said to-day in response to In
qulry by your correspondent regarding the
supply of currency:
The appeals for paper are becoming
absolutely piteous. There is a special de
mand from Kansas City and other points
in the South and West, where small notes
and standard silver dollars are the forms
| of money most desired. Small notes US
ually accumulate in the treasury during
the winter after the crop moving season,
! but this year very few notes of any kind
have come into possession of the treasury.
| The treasury is running over with gold
and we could get several millions more of
gold than we have if we had small notes
TO exchange for It,"
A Sign of Prosperity.
ITO what do you attribute such scarcity
of paper currency?" was asked.
Largely to the prosperity of the coun-
try, with the growth of population and the
expansion of business. We have had no
means of increasing the supply of currency
since the repeal of the purchase clause of
the Sherman law in 1893, except gold pro-
duction and gold imports and the national
! banek-note circulation. Gold imports have
| been very heavy and have immensely
strengthened both the circulating curren-
cy of the country and the treasury re-
serve. l am personally a strong believer
in metallic currency and would be glad
! to see gold in more general circula ton It
requires time, however, to educate senti-
ment upon that point after so many years
OF experience with paper. Moreover l do
not believe that gold coins should be is
sued in denominations of less than five
dollars, and much of the demand for cur
rency is for smaller demonstrations We
| can furnish standard dollars and frac-
tional silver and are responding to calls
for such coin, but PAPER IS much preferred
by most of our correspondents"
Remedy for the Trouble.
what is the remedy for the present
| condition of thngs?' inquired your cor
| respondent.
There are several possible remedies"
| replied Mr.. Roberts. Il have offered to
convert large United States notes into
small notes under conditions favorable to
the banks. The offer has not been accep-
TED because most of the large notes held
by the banks are a part of their required
| cash reserves. 1t would be possible for
them to withdraw these large notes from
their reserves substitute gold and convert
the large notes into notes of small denom-
nations. They have not shown much dis
position to do this, because of the cost of
| handling and holding gold. Some of Them
may be forced to do it If the pressure for
currency becomes more intense during the
crop moving season next autumn"
Legislation May BE Needed.
rs there not need for new legislat,or
10 provide for the currency needs of the
country" was asked, IF there is not 10 he
| such a scarcity of small paper,as tn nre-
cipitate popular demand for more green
| backs?" ID a''f 'T'7 o 80
Il think some legislation NAV be re-
CURED was the reply, but it must be
on conservative lines. We might issue
goid certitlcates, for the purpose of making
more available the surplus gold held nv
the New York banks, but 1 am inclined "a
agree with the general policy of Secretary
Gage, that the government should NOT
carry on safe deposit business for the
owners of gold at it soWn expense and
without charge to them.
zone of the surprising things about the
existing situation is the way in which the
national banknote circulation is declining
There was loss in the face value of the
| bonds on deposit to secure circulation of
about $5,500,00O between Jan. and the
middle of March Some of the banks. |
understand, have Withdrawn even the new
per cent. bonds and sold them at recent
quotations because of the profit due to the
premium. If this is their policy, we can
not rely upon the bond secured circula-
ton as the means for meeting The de-
mands for currency"
Bank Notes Secured by Cash.
what do you think of bank-note cur
rency secured by a large deposit of cash
in the custody of the treasury somewhat
like the leading banking systems?" asked
your correspondent of Mr.. Roberts.
Il have always favored such a system, -
was the reply. "Of course. the European
banks being, in most cases. monopoly is
sues-the only banks of issue In their re-
spective eountres-are subject to a close
scrutiny by the business public and their
position differs from the American banks,
| scattered to the number of 800 over our
wide extent of territory. Ii would be nee
essary for us to require the deposit of the
guarantee for the notes in the custody of
the treasury, In order to have the guaran-
tee unimpalred n case of failure.
II think if bank was authorized to
| deposit cash in the treasury to the amount
of 40 or so per cent. of the notes issued.
with a tax upon the excess to raise a
guaranty fund for the notes of failed
| banks, we should have a perfectly safe
system which would afford a sufficient
paper currency and would meet all de-
mands for elasticity which can legitimate
ly be made upon the circulating medium.
If the surplus of the tax were turned
into the public treasury, making the gov
eminent a sharer in the profits of issue
IL