The record-union., 1899-11-04
In Relation to the Establishment Of a Sold
Standard Basis.
Stands To-Day Just Where He
Stood Two Years Ago on This
Important Question Of Firmly
Establishing the Entire FinanA
cial System Of the Country Upon
Positive Legal Enactment.

NEW YORK, Nov. "a special to the
/ Herald" from Washington says:
Secretary of the Treasury Gage, in
discussing with the Herald" corre-
spondent the. financial questions which
gress, indicated very clearly that in
his annual report he will repeat in ~
general way his recommendation for
the establishment of the gold standard
1 in law. and for such reforms in the
banking laws as will give to the coun.-
! try more elastic currency.
| At a time when many politicians
seemed to be afraid of the word +gold,a
Secretary Gage perceived that the first
step in the direction of monetary re-
form was to found the gold standard
upon law, and not leave it based lmere-
ly upon the practice of the Treasury
Department which might at some. time
be reversed by a Secretary of the Treas<
ury Of the Bryan school of politics. His
declaration to this effect before the
Banking and Currency Committee OF the
House of Representatives caused a. lot
of uneasiness among timid men nAand
out Of Congress.
Secretary Gage stands to-day Just
important question of firmly estab ush-
ing the base of the entire financial sys-f
tenn of the country upon positive legal
enactment
Inseparable from the establishmentIof,
the monetary standard is the necessity.
of providing an adequate method of
maintaining it. That no such adequa te
! method now exists the Secretary be-
I iS - =.
the experience of 1898. That the note
issuing and redeeming functions of the
treasury must be entirely separated
from its ordinary operations relating, to-
revenues and expenditures, Secretary
Gage believes to be essential for the
gold standard established by law if it
is to be successfully maintained i'm
times of financial stress without de-
ranging the business of the country.
Secretary Gage is, if possible, more
firmly convinced than ever of the nec-
essity Of radical reform in the bank@
ing system of the country.
He favors legislation which will per&
NIT the establishment of banks with
$4,000 capital to meet the demands OF
small communities, which will permit
banks to issue circulation up to the par
value of the securities deposited; which,
will reduce the tax on bond secured cir-
culation and which will permit the iss
sue-under such restrictions as shall se%
cure the noteholder without impairing
the security of the depositor-of limit
ed amount of currency against the asa
sets of the banks, these notes to pay
tax which will both secure the Cow
ernment against loss in guaranteeing
them and will operate to retire the
notes as soon as the occasion for their
issue has passed.
The Secretary does not fndEit nec4
essary to go back to 1893 to findsa prac-
teal argument in support of theA bank4
ing reform which he advocates. 1t iS
only necessary to refer to the expefil.
ence of the last few weeks, when. thet
demand for money to move the crops
has been felt at the money centers,
more than usual because supplemented
by the need for more money in all chan-
nels of trade brought about by the ina
creased prosperity of the country. Ina
the absence of banking laws which,
would enable the banks to respond tor
this increased demand by putting OUT
notes, which would be retired as SOON
as the need for them had passed the
only recourse of the business commun4
lty was to appeal to the Treasury De-
partment for aid which was given by
the anticipation of interest on the,publ
lie debt
Students of finance agree with &SecA
retary Gage that a system Of banking
which compels the treasury to period-
lcally come to the relief of the banks
is radically wrong, not only in creat-
ing feeling among the banks that the
Government will come to their rescue
when they get into difficulties, which
careful management might avoid but
also because the Government mighttnot
always be able to give the relief when
needed, and widespread disaster might
ensue.
Secretary Gage would not discuss the
bearing of the recent financial situa-
tion upon the question of bank reform,
further than to say that he would prob
ably use it in his report ito point.a
moral
Drowning Of Engineer White.
WASHINGTON, Nov 3.-At the
headquarters of the Isthmian Canal
Commission nothing has been heard of