The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-03-09
NAYCiUSE MONEY STRINGENCY
THE go, 1000 900 TO BE PAID FOR
THE PANAMA CANAL.
Although the Cash naiance I'm the Treasury
IL 0491.0s0. soA. Only ga. 800 900
VIII he Available TO Pay for the Canal.
and els 900 900 Will Have to He
Withdrawn From National Banks.

VIII He Available TO Pay for the Canal.
and - Z yOOO. 900 Will Have to He
Withdrawn From National Banks.
WASHINGTON, March s.-Immediately
after the ratification OF the Isthmian Canal
treaty by the Senate. the Government
will be called on to pay over to the New
Panama Canal Company Of France the sum
of S4O,O0O.oO0, representing the purchase
price of that company's rights and prop
erty on the Isthmus Of Panama. For the
construction OF the waterway itself, special
provision was made by the law passed
at the first session OF the Fifty-seventh
Congress. authorizing the issue OF bonds
by the Government, but no similar pro-
vision was made for the payment OF the
$40 900 900 due to the French company.
1t Is necessary. therefore. to make this
large payment out OF current funds OF the
Treasury.
Although there Is nominally an enormous
cash balance in the Treasury. yet large
part OF this balance Is held by national
banks In the form of Government deposits.
The only serious feature about the coming
payment Is that 1t will be necessary Tor
the Secretary of the Treasury to make
heavy Withdrawals OF Federal deposits.
thus imposing possible hardship on some
OF the banks and increasing the danger
Of a money stringency In the financial
centres of the country.
Yesterday the available cash balance in
the United States Treasury stood at S222.-
$40 794. This Is almost record-breaking
amount in the history OF the Treasury,
but II Ia necessary to take Into considera-
ton the fact that the greater part OF this 's
held by the national banks as Federal
deposits-a larger part than at any time
since national repositories were authorized
by law. The cash balance actually In the
Treasury vaults yesterday was only s72 ,s4s,-
394. This means that the amount in ma
tional bank repositories Is 3l4a $3.50 400.
There Is an unwritten law that the Secre-
tary of the Treasury shall always keep on
hand working balance Of st least $50 ,OoO,-
900. II this rule is followed, as 1t certainly
will be by Secretary Shaw, the actual
available balance in the Treasury vaults
to be applied to the purchase OF the Panama
company's rights Is only S22 ,si3, se4, AS
the amount due Is $40 900. 900. 1t will there
fore be necessary for Secretary Shaw to
withdraw from the national banks deposits
more than Si7 900 600. provided the cash
balance in the Treasury remains at ap-
proximately the present figure for the next
Few weeks
The Treasury officials are not pleased with
the prospect Of having to reduce the amount
OF the deposits held by the banks, and
Secretary Shaw regards the outlook with
some little uneasiness. The Secretary
was ardently in favor Of the passage OF the
Aldrich Financial bill. which was proposed
during the closing days Of the late session
Of Congress, for he believed that measure
orr RI
Since the measure has failed Mr.. Shaw
looks forward with little confidence to an
easy market during the next crop-moving
season, and he finds no reason to believe
that the money stringcncy will be felt less
severely than 1t was last fall and during
the early months Of the present winter.
Speculation is still active. and the pros
porous condition OF trade calls for an enor-
morn volume Of money in circulation. To
withdraw from Si5.000,O 900 to S20, 900 900 Of
to cancel the effect of the extraordinary
efforts that were made by the Secretary
Of the Treasury last fall to relieve The money
stringenoy;. For several weeks, money
conditions have been easier. but the Treas
ury officials believe that all the money now
in circulation Is imperatively needed to
supply the activities OF trade.
Owing to the repeal Of the war taxes,
the accumulation OF funds from internal
and. combined with large expenditures,
this fact has kept the Treasury surplus
for the first two-thiris OF the fiscal year
down to about $50. 900 900. The revenue
receipts are still very large. however. owing
TO the prosperous business conditions pre-
vailing throughout the country, and these
receipts will probably he turned over very
largely to the national banks for deposit:
The receipts from internal revenue during
the last eight months have amounted to
about SI55 600 .OOO The customs receipts
are much larger, but these cannot. under
the law. he deposited in the banks. Had
the Aldrich bill been passed. II would have
been permissible 10 turn over customs
receipts az well as internal revenue receipts
for deposit In national repositories, and
this would have relieved the situation grow
ing out OF the coming payment on account
of the Panama Canal.