The times. [volume] (Richmond, Va.) 1890-1903, 1900-05-18
STA TE BANK Frs
IN SESSION.
(contlnued from First Pages

liz SEOOlUN#
Continued from First Page9
kinds. Thus there Will be only one
lind of the smallest notes. United
States State notes go out of SO and upwards
only. The Treasury notes, which are
legal tenders, and have been redeemed
in gold as well as silver. viii gradually
nass out OF use, and silver certificates
viii take their place. BY this process,
nj ,n,,t SIS eco, 800 will after awhile be added
to that class of paper, and the circuia-
ZION besides subsidiary, based on silver,
will become Sap G0o,oa0, or more-nearly
ona-fourth of all our currency. Gold
cerfjffea ties continue 10 stand for so and
muitibies of that sum- The problem
~ orr paper thus loses some films of its
complex web. Other threads may, in due
time, wisely be thrown away We have
come a great ways from the TOBACCO
currency of early Virginia
BANK-NOTES.
Just what measure of imitation in
bank-notes will this act cause? AT once
it added 10 the rights of the banks TO
issue 10 per cent. on their bonds pieosed,
which were on March 1st s25s. ,2'o-sas
S240O0,O00. The increase of securities Tor
circulation has to May II. JUST TWO
months. been =s324iS,9IO making present
total of s272. 3as. 2s0. Already then. the
potential bank circulation has grown
under the law by $4,000, 000- Applications
for new charters are already 2sb ana
OF these Sc were from State and private
institutions. Their aggregate capital is
sl2959.tHAD. Of the new banks $50 have
a capital less than $4,000. OF these So
have been fully organized. Is of them
institutions already in existence Before
next autumn the addition to the number
of banks will not be less than 500. with
capital of s20OG0.000 The national banks
never have issued notes TO the full volume
permitted by the statute. Their capital,
the limit of issue was February 18th.
s6l3,0Sii65, and Yet their bonds pledged
were less than two-ffths of their possible
circulation. The capital of the national
banks before September next will be
likely TO be S633. 00n.0O1. and a safe esti-
mate OF the bank notes issued by that
date is $3.50 100000 The imitation possible
is great; the extreme imitation probable
for the season cannot run much above
the standard of December, 1878. The
most ti1nd cannot find here cause for
alarm.
The time required for printing the notes
has delayed their entry into use. but the
actual addition under the new law has
been $l2 Dos, $40 out OF S56eo0.000 due. This
sum will be made up within week. The
records show that 1893 banks have no
-flDleS plejil GU " met SiliiSi Cueihp-
tons or increase. because of their own
neglect to file orders. The Department Is
meeting the demands of forty banks each
day on the average. so that in less than
forty days the supply will reach a nor
NAL state.
ELASTICITY OFF BANK CIRCULATION
The charge is on all lips that circula-
ton under the national system is rigid.
not elastic. Is that quite true now?
~,
banks for which the Treasury holds
cash: these were, on April So $3a.211,-
1854. Notes for which bonds are pledged
We're at their maximum, S341 ,S2o.256, De-
cember g. 1873; they We're al their Mini
mum. 1922, a2S.oS4. on October 9. 1890 Here
is a fall in the seventeen years of S21S,-
$50, 1l2 leaving bny 1901 per cent. out
standing. In this period. in each of four
years there was an increase of circula-
ton. go per cent. III 1917: LOT in 1878:
496 in 1873 and 296 per cent in 1881. The
fall was as great as e5.19 per cent in
1856 1888 in 1887; 1879 in 1SsS: 1872 in 1899,
and $40 to the minimum, October 9, 1890.
The ten years since 1920 furnish more
striking figures in three of them the
notes fell 4.60 per cent. in 1894. 9.1S in1S9I.
and lbs per cent in 1899. In each OF the
other seven years there was rise as
high as 1898 per cent i'll 1888, and 1916
in 1896. Since January I, 1900, to May l,
the has been 1880 per cent. and the
bank circulation is more than double its
amount in October, 1890.
These changes indicate what could be
done always under the national system.
A simple clause now allows Tree ebb ana
flow Under previous law, bank which
withdrew bonds pledged for notes could not
until after the lapse of six months in
crease its circula ton. The repeal of that
restriction in this act permits withdrawal
and addition to alternate at pleasure,
save that no mere than s3OO0,G00 in bonds
can be taken out in any month. The
purpose is to give elasticity 10 the cur
rency That result follows also from the
greater profit which Will come from cir
cula ton, SO that bank can afford to
put out a goo5ly volume of notes and
in dull seasons lock up a part of them. 1t
will be we'll worth while TO watch this
process.
GOLD AND CURRENCY.
These results are possible, this fruit rip
ems before US, because by the Act OF
March IA. 1900, the practice of the gov
eminent in paying its debts in gold and
keeping its currency al parity, is writ
ten in the statutes The policy of one
administration may be cast aside by its
successor. law is more enduring, can
not be changed SO easily. has a certain
sa credneSs and force.
Not by statutes alone, however. has
gold become the master element in our
currency For three years more than
ever before has the yellow metal been
thrusting itself into our markets, our
vaults. into the pockets OF the people.
The stock il our country passed the bill
lion mark last .December. Since this
year began s27.515,250 has been added,
while the gold in coin and certificates
in circulation has been increased by SILL
962,52S. and reached, May l, SSlt.063. loo
40 per cent. of all our money afloat. in
Guiding bank notes. 1t means great
deal that in each of the past four
months gold has gone into our currency
a. an average of $4,000 a month, over
100000, 0C0 a tyaar. The tide IS rising
ra tiher than falling. and a growing share
comes from our own mines. More than
third of the product Of the word
reaches our Golfers, and enriches gov
eminent and people. The Treasury Of
fers lis creditors gold coin. and they put
in from them and cry for paper. SO
yhish. so solid, so stronger than .the most