The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1901-04-01
MONEY TO BE PILED UP.
Gage Gives Out a Statement Concern.
ing Treasury Surplus.
SAYS HE CAN NOT BUY UP BONDS
Price Is Too High for Either the Govern
ment or the Banks to Pur-
chase Them.

Washington. March Si.--Secretary Gage
gave out the following today as to his
probable action with respect to the cash
accommodations in the treasury and parllcu-
larry as to whether he contemplated buy
Ing bonds for the sinking fund. The
statement is in the form of an Interview;
'"rhe country would like to know, II
was stated to the secretary, whether the
accumulation of money in the treasury
which seems to be going ON viii not ope
rate to the prejudice of general business
affairs. Your estimate is that there VIII
be surplus Of receipts oyer expenditures
for the fiscal year ending June 80 next OF
about sSOU00,000 Your statement pup
llshed Yesterday shows that some Slo'-
coo 600 Of that sum already has been real
tied. This would Indicate that WIN" WIZ. ~
thp next three months SiD.O00,0JO more oI
cash will be gathered INTO tne
from the general money market. s,oor
The secretary--The estimates you speah
Of were made before the last session OK
congress and have been modified ,py eNeI1s
ana by congressional action ls ~.
now contemplated that the yenr ~ pius
viii he over sG000U.OO0. y falling on III
receipts or larger disbursements tnan nave
been estimated for may also iurthet INQUIRY
the effect to which you point.
Question Well, Mr. Secretary, even then
IL seems the cash holdings of the treas,
ury VIII he increased by some S2O,OOo,ouo
between now and June no. Are you WIZ
do nnytLinr to relieve general affairs II
they be adversely affected by the tie up Oh
muney in the treaslry; .u
The Secretary There alW only Two
methods open 10 get surplus funds out OF
the treasury vaults. one is TO luSTeas
treasury deposits In National bank &c,
positorics the other is 10 buy United
States bonds The latter is more con
sistent with government methods thah Tue
former, since IN buying bonds interesl on
The public debt By 50 lnugh + St3piteaii
ivetiRed In bnying bonds other than thoSo
Wlc. will mature and become subject %
payment within the next seven years A
a proper price II would ~ doubt I've VIII
| ing to buy these and thus relieve me
Treasury from surplus which. as Yon us
sumo might undcr some conditions, W
/ prejudicial to general business atnlrS, ~ ~
ihc present quoted rates for the shHri
! bonds | d, NOT think the secretary VIII
bc justified in buying bonds. The IS at
the price Yield an Investment return nI
! only 1OS per cent The short - l.bl nc
per cents of 1908 13i per cont, while
/ the new > per cents nj their present price
/ yield Il higher Investment return, VIZ. LID
/ per cent Now II Is well known and dc-
( kuNwledgcd fact that longtime govern
/ mont bond. everything else being equal
/ is worth relatively more than Shnrt-tima
/ bond. The present disparity 20 the con
/ rrary Is therefore, Illogical if not arti-
/ fetal. and az thcr present price the s'cre-
! tary will not buy them.
Question As IN Alternative, would you
not increase the deposit of public MONEYS
/ with III" banks!
The Secretary No; that would asgrayarc
I In some particulars the situation to whlrh
1 have Just refuvrcd 10 qualify ms dc
pCsitarieS the hanks would have TO buy
/ and deposit bonds. the effect would nc
/ TO set up a competition by the MD OF lie
| government against tho government in the
purchase Of the securities, already All
normally high We are now advauc NJ
| toward the period of the year when there
/ is apt TO We u money plethora Inst, al ol
Il money scarcity so | do not SIC that
1t will do any particular harm II mon y
| accuululgtrs Ia the treasury.
The reduction in taxation will, whom II
becomes operative, partially or wholly
cure the present tendency toward a con
scstion In the treasury.
TO put the matter IN a nutshell, If it be
& choice between buying bonds al an
artificial price and letting funds accumu
late In the treasury, the latter viii &C.
<ur. nor will the department advertise
for offers of bonds. 70 do SO, l am salts
fed, would be fruitlcss in results. IT,
howcycr the department can from time
To- time buy the short bonds at an invest
meut rate rcalizahle to the investor. WI.
buys the new per cents IL will MOI
hesitate to do SO, should the present mar
ket price for the new 2s remain ON the
present bass.