The Denison review. [volume] (Denison, Iowa) 1867-current, 1900-03-16
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ment in part, in explanation of the pro-
visions of the financial bill, which pass
ed the house: 1.-The bill has for its first
object the fixing of a standard of value
and maintaining at parity with that
standard all forms of money issued or
coined by the United States. 1t re-
that the unit of value is a dol
lar, consisting of twenty-five and eight
tenths grains of gold nine tenths fine,
but from that point goes on to make it
the duty of the secretary of the treas
ury to maintain all forms of money is
sued or coined at a parity with this
standard. For that purpose the bill
provides in the treasury bureas of is
sue and redemption, and transfers
from the general fund of the t%reasury's
cash $3.50, 100000 in gold coin and bull
lion to the redemption fund, to be used
for the redemption of the United States
notes and treasury notes. That fund
henceforth is absolutely cut out of and
separated from the cash balance in the
treasury and the available cash balance
will hereafter show a reduction of $780,. |
OOO,0 900 from the figures that have here-
tofore prevailed. The fund is to be
used for no other purpose than the re-
demption of United States notes aud
treasury notes, and those notes so re-
deemed may be exchanged for gold in
the general fund or with the public, so
the reserve fund is kept full with gold
to $3.50, OOO, 200 limit.
"If redemptions go on so that the
gold in this fund is reduced below
Sl0O,0OO,O 600, the secretary is given
power to sell bonds; it is made his duty
to replenish the gold to the $3.50, 0OO, GOO
marx by such means. a VIZ
1.-The .endless chain,is broken by the
provision which prohibits the use Of
notes so redeemed to meet, deficiencies
in the current revenues, The act pro-
vldes for the ultimate retirement of all
TREASURY notes issued in payment for
silver bullion under the Sherman act.
As fast as that bullion is coined into
silver dollars treasury notes ale to be
retired, and replaced with an equal
amount of silver certificates.
The bill provides for a larger issue
of silver certificates, by declaring that
hereafter silver certificates shall be is
sued 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 certificates in the
way of small bills by another provision
which makes it's necessary as fast as
the present silver certificates of high
denomination are broken into small
bills, to cancel a similar volume OF
United States notes of small denomina-
tions, and replace them with notes of
denominations of $40 and upward.
"One clause OF the bill, which the
public will greatly appreciate is the
right that it gives to the secretary TO
coin any of the bullion into subsidiary
silver coins up to the limit of O,OOO.-
600.
Another provision that the public
will greatly appreciate is the authority
given to the secretary to recon worn
current subsidiary silver now in the
treasury or hereafter received. The
Dill makes a continuing appropriation
for the paying OF the difference between
the face value of such coin and the
amount the same will produce in new
coin.
"A distinct feature of the bill is in
reference TO The refunding of the 3 per
cent Spanish war loan, the 2 per cent
bonds maturing in 1907. and the 5 per
cent bonds maturing in 1904, a total OF
1886, 100000, into new 2 per cent bonds.
These new 2 per cent bonds not to be
offered for sale, but only to be issued in
HexchaDge for an equal amount, face
OF the old bonds will receive a premium
in cash to compensate them in a meas.
ure for the sacrifice of interest which
they make. The cash premium will be
computed on the basis of the present
worth of the old bonds at 24 per cent.
This exchange will save the govern
ment after deducting the premium
paid, nearly 1923. GOO, 600, if all the hold
ers of old bonds exchange them for new
ones. National banks take circulation
based on the new bonds are to be taxed
only one-half OF n per cent on the
average amount of the circulation out
standing, while those who have circula.
ton based on the deposit of old bonds
will be taxed, as at the present, one
per cent.
The law permits national banks to.
issue circulation on all classes of bonds
deposited up to the par value of the
bonds, instead of 80 per cent of their
face as, heretofore This ought to
make an immediate increase in the ma
tional bank circulation of something
like $24, 100000, as theamonnt CT bonds
now deposited to secure circulation is
about $242, 000. 600. If the price Of new
% is not forced SO high in the market
that there is nc profit left to national
banks in taking out the circulation, we
may also look for a material increase
in national bank circulation based on
additional deposits of bonds.
National banks are permitted under
the law to issue circulation up to an
amount equal to their capital. The
total capital of all national banks is
$616. OOO, 900; total circulation outstand-
ing 1926, 100000. There is, therefore, a
nOSsibiIjtv Of AN innrooco of oironlo+;on