The Billings gazette. [volume] (Billings, Mont.) 1896-1919, 1902-09-16
TO RELEASE
IDLE. FUNDS
SECRETARY SHAW PREPARES
FOR AN EMERGENCY.
GUARDS AGAINST A PANIC.
No Cause Of Alarm, But Takes Steps
to Insure Abundance Of
Free Money.

TTeS WOnSys
Washington, Sept. IA Secretary
Shaw has issued the following state
ment:
Secretary Shaw has made arrange
ments to release about $4,000, 900 of
the treasury holdings. He has had a
list prepared of those national banks
throughout the country which held
free or pledged bonds at the date Of
their last report and has made in
quiry for others. After making allow
ance for changed conditions since the
last report he expects this will re-
lease at least $4,OOO,OO0.
He has sent notice to all such that
if they will send these bonds to the
treasurer of the United States in sums
of $4,000 or more they will be desig-
mated as temporary repositories and
the face value Of the bonds will be
deposited with them to the credit Of
the treasurer Of the United States.
He has pursued this course in prefer
ence to designating repositories in
the ordinary way, which compels them
to buy bonds in the market at large
premium, thus paying cut more for
the bonds than they get from the
government. The customs receipts
are extremely heavy at this season of
the year. and the cash balance of the
treasurer has been gradually increas-
ing.
Anticipates October Interest.
He has also decided to anticipate
the October interest, amounting to
about $4,2O0,O00, and with this in
view orders have been issued to the
various sub-treasuries to cash such
coupons as may be presented and the
treasurer of the United States has
been instructed to mail checks for
interest on the registered bonds. All
this was decided upon some days ago
and letters and kilograms prepared
for today.
The secretary sees in present con-
ditions no occasion for alarm. He
calls attention to the fact that there
is no evidence of currency famine
present or prospective, elsewhere than
in New York, and even there the rate
is not high for commercial paper, and
for commercial paper he has the
greater solicitude. He is well salts
fed with his efforts to increase the
circulation which he decided upon in
the early summer when present con-
ditions were visible and has been pre-
pairing to meet an emergency which
he does not expect, but which he
thinks it is wise to provide against.
Thus far he has made requests only
of such banks as hold large deposits
and have very limited circulation, and
he is not asking these to increase to
the maximum, nor to increase at all
for the present. He does not desire
to force the banks into, the market to
buy bonds at rate higher. than the
government is willing to pay. He
does desire to make the best possible
use of the free bonds now held by
the banks.
incidentally, he likes to encourage
banks to hold free bonds during the
dull months, believing it is much bet
ter to hold bonds that will yield one
half of per cent even, than to make
new loans at per cent. Therefore,
he is giving banks that hold these
free bonds an opportunity to use them
to most excellent advantage. This
method, if pursued by the banks,
would give slight element of elas-
ticity to our otherwise inelastic cur
rency system.
z Position Explained in Letter.
His position as regards increasing
circulation is perhaps best expressed
in 1etter which he recently wrote to
a banker who had been already buy
ing bonds, and which he has consent
ed to make public. 1t is as follows:
Treasury Department, Washington.
D. c., Sept. 10, 1902: My Dear Sir
Your letter of the Sth is received.
find it we'll nigh impossible. to con-
vey the purport of my request even
to the banks, of whom have made
the request, much less to the public.
First-In case of imminent danger,
or actual disaster, will be compelled
to use government deposits to buy in
creased circulation.
Second-I desire to have from fif-i