Evening star., 1900-08-09
FINANCIAL HISTORY
An Important Document Issued by
the Treasury Department.
GOLD DOLLAR TEE Unit OF VALUE
Paper Currency and the Status Of
Each Kind.

MON NETARY EV EN- T
The Treasury Department has just issued
most valuable and comprehensive finan-
cial document. 1t is a pamphlet that gives
in detail the financial history of the govern
ment from its foundation. 1t is similar to
the circulars issued in 1896 and 1897 but the
present document presents many facts not
heretofore printed. The pamphlet was pre-
pared by A T. Huntington, chief of the
divisions of loans and currency of the
treasury, at the suggestion Of Assistant
Secretary Vanderlip.
In this political year the facts contained
will be Of widespread interest and use. This
treasury document says that while the law
provided double standard for over 100
years 1t has never been effective.
Standard of Value.
In providing for the coinage of the prec
ious metals Congress established, by the
act Of April 2, 1892, the standard of value,
consisting Of certain gold and silver coins.
at a ratio of 10 to THAT is to say, the
value of ounce of fine gold was in effect
declared to be equal to the value of fifteen
ounces of fine silver. A list of the coins
authorized by the act Of April 2, 1892, with
their weights and fineness, will be found
in another place. Both gold and silver
coins were declared to be standards.
The ratio of 10 to was adopted in pur-
suance of Investigations conducted by
Treasury. who, in his report upon the sub
ject, said that 10 to l was near approx
nation to the commercial value Of the two
metals. 1t was soon discovered, however,
hot crolI OF tba To Of to 1 md
valued, and silver became practically the
only metallic money available for use In
the United States. In 1894 the ratio was
changed to 1902 to /, and in 1887 it was
ratio, and is commonly called is to !. BY
this change silver was undervalued and
gold came into use in its place.
By the act of February IL, 1873 the COIN
age of the standard silver dollar was dis
continued, and the gold dollar of 2J.S grains
of standard gold, 800 fine, was declared to
be the unit of value. The subsequent res
toration Of the coinage of silver dollars
under the act of February 2S, 1873 was on
government account and did not restore
the silver dollar to its former place as a
standard of value.
But while Congress provided for the so
called double or bimetallic standard such
double standard has never been effective
in this country. From 1892 to 1884 silver
was the metal by which all values were
measured, and since 1884 gold has been, and
Coins and Paper Currency.
There are ten different kinds of money in
circulation in the United States, namely,
gold coins, standard silver dollars, sub
sidiary silver, gold certificates, silver GER
tificates, treasury notes issued under the
act of July IA. 1890 United States notes
(also called greenbacks and legal tenders),
national bank notes and nickel and bronze
coins. These forms of money are all avail
able as circulation. While they do not all
possess the full legal tender quality each
kind has such attributes as to give it cur
rency. The status Of each kind is as fol-
lows:
Gold coin is legal tender at its nominal
face value for all debts. public and pri-
Vate, when not below the standard weight
and limit of tolerance prescribed by law;
and when below such standard and limit of
tolerance 1t is legal tender in proportion to
its weight.
Standard silver dollars are legal tender
at their nominal or face value in payment
of all debts, public and private, without
regard to the amount, except where other
wise expressly stipulated in the contract
Subsidiary silver is legal tender for
amounts not exceeding $40 in any one pay
ment
Treasury notes of the act of July a.
1890, legal tender for all debts public
and private. except where otherwise ex-
pressly stipulated in the contract
United States notes are legal tender for
all debts, public and private, except duties
on imports and interest on the public debt
Gold certificates, silver certificates and
national bank notes not legal tender
but both classes of certificates are receiva-
Bile for all public dues except duties on i'm
ports, and may be paid out by the govern
ment for all salaries and other debts and
demands owing by the United States to In
dlVlduals, corporations and associations
within the United States, except interest
on the public debt and in redemption of
the national currency. All national banks
are required by law to receive the notes of
other national banks at par
The minor coins of nickel and copper are
legal tender to the extent of % cents
Paper Money.
The first paper money ever issued by the
government of the United States was au-
thorized by the acts of July II and August
., 1861. The notes issued were called de
mand notes." because they were payable
on demand at certain designated subtreas-
uries. They We're receivable for all public
dues, and the Secretary was authorized to
reissue them when received; but the time
within which such reissues might be made
was limited to December 81, 1862. The
amount authorized by these acts was $50
oO,0OO An additional issue Of s10,OOOOOO
was authorized by the act of February 12
1862, and there were reissues amounting to
10000. The demand notes We're paid in
gold when presented for redemption, and
they were received Tor all public dues, and
these two qualities prevented their depre-
citation. All other United States notes were
deprecated in value from 1862 until the re-
sumption of specie payments, shown by
the table hereinafter following. The act
of February %, 1862, provided for the sub
stitution Of United States notes in place of
the demand notes, and the latter were
therefore Cancelled when received. BY July
l. 1863, all except s., 10000 had been re-
tired and nearly three millions of this
small remainder were Cancelled during the
next fiscal year. These notes were not le-
gal tender when first issued, but they were
afterwards made so by the act of March II,
1852
Fractional Currency.
When specie payments were suspended,
about January 1. 1862. both gold and silver
coins disappeared from circulation. The
place of the subsidiary silver coins gas for
time supplied by the use Of tickets, due
bills and other forms of private obligations,
which were issued by merchants, manufac-
turers and others whose business required
them to make change" Congress soon In