The times. [volume] (Washington [D.C.]) 1897-1901, 1900-03-14
EXPLAINED BY Mr.. GAGE
A Statement Concerning the OBJ
jects of fhe Financial Bill.
Ample Power Given the Secretary of
the Treasury to Maintain All
Forms of Money Mt n Parity With
the Gold Observation-Disclosures Fen
tnrcs of the Measure Discussed.


the House yesterday afternoon will hav'
a marked effect on the administration
of the Treasury Department, and Secre
tary Gage has been making preparations
Tor some time to carry out the provision!
OF the measure. Some of the chief proyi
| sfons of the bill were either suggested b!
| Mr.. Gage or were adopted after consulta
| TONS between him and the Senate ant
House leaders. After the passage of The
bill the Secretary made this statement;
The Financial bill, which now awaits
| only the Presidents signature to become
! law. has for it's object wnat its titlt
! incicates-the fixing of the standard Of
value and the maintaining at parity with
that standard OF all forms of money issued
or coined by the United States. 1t re-
! afhrms that the unit of value is the dol
lar, consisting of twenty-five and eight
tenths grains OF gold. nine-tenths fine, but
! from that point it goes on to make 1t the
1 duty of the Secretary of the Treasury tO
maintain all forms of money issued OF
coined at parity with this standard. Ii
puts into the hands Of the Secretary ample
| power to do that.
For that purpose the bill provides In
! the Treasury bureaus of issue and re-
] demption, and transfers from the general
1 fund of the Treasury's cash $3.50. .000. 900 in
| gold coin ana bullion to the redemption
| fund, that gold to be used for the redemp-
! tion of United States notes and Treasury
notes. That fund is henceforth absolutely
| cut out OF and separated from the cash
| balance in the Treasury, and the availa-
I Bile cash balance will hereafter show re-
| duction of $3.50 000. 900 from the figures
| that have heretofore prevailed. This
| Sl5O. 600 redemption OF United States
notes and Treasury notes, and those notes
| so redeemed may be exchanged for gold
in the general fund or with the public.
so that the reserve fund is kept full with
gold to the $150.0000O0 limit.
The Secretary is given further power.
III redemptions go on so that the gold in
! this reserve fund is reduced below $780,
| 100000, and ne is unable to build it up to
the $3.50 000. 900 mark by exchange for gold
in the general fund or otherwise. he Is
given power to sell bonds. and 1t is made
! his duty to replenish the gold to the Sl5O,-
600 600 mark by such means.
The ,ndless chain is broken by pro-
vision which prohibits the issue Of notes SO
redeemed to meet any deficiencies in tue
current revenues. The act provides for the
ultimate retirement of all the Treasury
notes issued in payment for silver bullion
'nder the Sherman act. AS fast as that
bullion is coined into silver dollars, Treas
ury notes are to be retired and replaced
with an equal amount of silver certificates
THE measure authorizes the issue of
gold certificates in exchange for deposits
of gold coin. the same as at present but
suspends that authority whenever and so
long as the gold in the redemption fund is
below sl0o. GOO, GEO. and gives to the Secre-
tary the option to suspend the issue of
such certificates whenever the silver GER
tiicates and United States notes In the
general fund OF the Treasury exceed $780,
coo, ,0G0 -r
The billsprovides for larger issue of
silver certificates by declaring that here
after silver certificates shall be issued only
in denominations of $40 and under. except
as to 10 per cent OF the total volume Room
is made for this larger use OF silver GER
tifcates in the way of small bills by an
other provision which makes it necessary
az fast as the present silver certificates OF
high denominations are broken up into
small bills 10 cancel similar volume of
United States notes of small denomina-
tions and replace them with notes of de-
nominations Of SO and upward. Further
room is made for the circulation of small
silver certificates by a clause which per-
mits national banks to have only one OF
their circulation ia denomination under $40
"One clause cf the bill which the public
will greatly appreciate IS the right that
II gives to the Secretary to coin any OF
the 1890 bullion into subsidiary silver
coins up to the limit of s100. 000. coo. There
has for several years been a scarcity of
subsidiary silver during period of active
retail trade, but this provision will give
the Treasury ample opportunity to supply
all the subsidiary silver tina is needed.
Another provision that the public viii
greatly appreciate is the authority given
to the Secretary to recon all worn and
Uncurrent subsidiary silver now in the
Treasury or hereafter received. The bill
makes a continuing appropriation for pay
ing the difference between the face value
of such coin and the amount the same will
produce In the new coin.
"A distinct feature of the bill is in
reference to refunding the 3 per cent Span
ish war loan. the per cent bonds ma
turing in 1907, and the per cent bonds
maturing in 1904, a total of sS39. 300 600.
into new 2 per cent bonds. These new
bonds vii, not be offered for sale, but will
only be assigned in exchange for an equal
amount, face value, of old bonds. The
holders of old bonds will receive a pre-
MUM In cash to compensate them in a
measure for the sacrifice of interest which
they make. That cash premium will be
computed ON a basis of the present worth
of the old bonds at Ii per cent. ard will
be on April l, the date that the new . per
cent bonds will bear. l05.6S51 for the 3's,
III 6765 for the AS, and I1O.075I for the
SIS This exchange will save the Govern
ment, after deducting the premium paid
nearly $23. .000, 600, II all the holders Vf
the old bonds exchange them for the new
ones. National banks that take out cir
culation based on the new bonds are to be
taxed only one-half of l per cent on the
average amount of circulation outstand-
ing while those who have circulation
based on ID deposit of old bonds will be
taxed as at present, l per cent.
There are some other changes in the
National Banking act. The law permits
banks with s25.o00 capital to be organized
in places of 3,0c0 inhabitants or less.
whereas heretofore the minimum capital
has been $50, Goo 1t also permits banks to
issue circulation on all classes of bonds
deposited up to the par value of the bonds
instead of 81 per cent Of their face. as here
tofore. This ought to make an immediate
increase in national bank circulation of
something like $24 600. 600 as the amount
of bonds now deposited to secure circuIa
tion is about S2i2 O00. eco.
IF the price of the new IS is not forced
so high in the market that there Is no
profit left to national banks in taking out
circulation We may also look for a mate
rial Increase in national bank circu!atioa
based on additional deposits of bonds. n.
tional banks are permitted under the lay.-
TO issue circulation up to an amount equal
to their capital. The total of all national
banks is $616. Coo 000. The total circulation
is sos 0OO, Geo. There is. there
fore. a possibility of an increase in circu-
ls ton of 1865 eco, eco, although the price Of
the new per cent bonds as already fore !
shadowed by market quotations in advance |
Of their issue. promises to be so high thar |
,h. profit to the banks in taking out cir |
cs,Iation will not he enough TO mako tba in |