The aegis & intelligencer. [volume] (Bel Air, Md.) 1864-1923, 1900-03-16


provides for the ultimate retirement
of all the Treasury notes issued in
payment for silver bullion under the
Sherman act. AS fast as that bullion
is coined into silver dollars Treasury
notes are to be retired and replaced
with an equal amount of silver certi-
ficates.
THE measure authorizes the issue
of gold certificates in exchange for de-
posits of gold coin, the same as at
present, hut suspends that authority
whenever and SO long as the gold in
the redemption fund is below 500. O00,-
900, and gives to the Secretary the
option to suspend the issue of such
certificates whenever the silver certi-
fcates and United States notes in the
general fund of the Treasury exceed
$G0,OOO,OOO.
1.-THE bill provides for a larger issue
of silver certificates by declaring that
hereafter silver certificates shall be
issued only in denominations of $40
and under, except as to 10 per cent. OF
a total volume. Room is made for
this larger use of silver certificates in
the way of small bills by another
provision which makes it necessary as
fast as the present silver certificates of
high denominations are broken up
into small bills to cancel a similar
volume of United States notes Of
small denominations, and replace
them with notes of denominations OF
$40 and upward. Further room is
made for the circulation of small silver
certificates by a clause which permits
national banks to have only one-third
of their capital in denominations
under $40.
Zone clause of the bill which the
public will greatly appreciate is the
right that it gives to the Secretary to
coin any Of the 1890 bullion into sub.
sidiary silver coins up to a limit of
800, 900, o00- There has for years been
scarcity of subsidiary silver during
periods OF active retail trade, but this
provision'will give the Trea sury ample
opportunity to supply all the subsi-
diary silver that is needed.
Another provision that the public
will greatly appreciate is the authority
given to the Secretary to recon worn
and uncurrent subsidiary silver now
in the Treasury or hereafter received.
The bill makes a continuing appro-
priation for paying the difference be-
tween 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 8 per cent.
Spanish war loan, the per cent.
bonds maturing in 1907 and the per
cant. bonds maturing in 1900, a total
OF $3.50, 900, 900, into new 2 per cent.
bonds. These new per cent. bonds
will not be offered for sale, but will
only be issued in exchange for an
equal amount, face value, of old
bonds.
1.-The holders of old bonds will re-
ceive a premium in cash to compen-
safe them in a measure for the sacri-
flee of interest which they make.
That cash premium will be computed
on a basis of the present worth of the
old bonds at e4 per cent, and will be
Y>riI tina 1ota fhof
per cent. bonds will bear $105 6S51 for
the 3's, $111,6765 for the As and
$110, 0751 for each 800 OF the SIS.
"This exchange will save the Gov
eminent, after deductirg the premium
paid, nearly $?3.OOO,OOO, if all the hold
ers of the old bonds exchange them
for the new ones. National banks
that take out circulation based on the
new bonds are to be taxed only one
half OF 1 per cent. on the average
amount of circulation outstanding,
while those who have circulation
based on deposit of old bonds will
be taxed, as at present, per cent.
There are some other changes in
the national banking act The law
permits national banks with SEA, 900
capital to be organized in places of
5000 inhabitants or less, whereas here
tofore the minimum capital has been
$4,000. 1t also permits banks to is-
sue 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 national bank circulation
of something like $24, OOO,O 900, as the
amount of bonds now deposited to Sc.
cure circulation is about $242, 900, 900.
If the price of the new 2's 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 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 S616 100000. The total circulation
outstanding is 1858, 10000. There is
therefore, a possibility of an increase
in circulation of 1868, 900, 900, although
the price of the new per cent. bonds,
as already foreshadowed by market
quotations in advance of their issue,
promises to be so high that the profit
to the banks in taking out circulation
will not be enough to make the in