The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1903-03-23

cept for small coins and to rid itself of
lts surplus silver, replacing it with
gold. Silver is bound to come into
larger use in the arts and manufactur-
ers by reason &C its increasing cheap
ness and increasing supply. There are
hmltless deposits of silver yet I'M
worked. Furthermore, silver is an i'm
portant by-proof of copper and lead
mines and also of gold mines.
Gold Currency Through Bonds.
The actual gold money in the United
states at present consists of the gold
certificates against which gold is held
IN the treasury; the gold reserve of
SI5O'0o0,OOO held in the treasury for the
redemption of United States notes and
treasury notes; and the further amount
OF. gold In the treasury and in cfreula-S
ton.
Mr. Smiths method of providing com
pete pete gold currency easfde from national
cank issues is by the issuance of bonds
AS security for the money which is not
IN gold or backed by gold Mr.. Smith
issued S; bearing per cent interest. pay
able semi-annually, and running fft-
years. These bonds would not be sold
to obtain gold, would be held in trust in
terest became due it would be paid into
the the currency fund by the treasury. At
the end of fifty years, If no other means
were adopted for earlier completion
OF the currency fund the fund would be
competed and the bonds would be can
ceiled; but Mr.. Smith proposes that the
same powers be conferred upon the secre-
tary of the treasury for the redemption
OF these bonds as for the redemption OF
others when the surplus revenues of the
=! tne government permit: Therefore,
II the revenues would permit the addition
IN any year or half year of $4,000, 900 or
$25, GOO, 600 to the currency fund a CORE
spondlng amount of bonds would be
cancelled and the requirement for pay
nent of interest would be corresponding
ly reduced.
To Sell Silver Dollars
The silver dollars latter conversion into
bullloD now held in the treasury against
silver certificates and the silver bullion
now ned In the treasury against treas
such amounts and at such times as
might be most advantageous in the dis
Gretlon or the secretary of the treasury
would be added to the currency fund and
a corresponding amount of bonds can
Counting the bullion value of the silver
money with the gold money the total is
equal approximately tor66 20 per cent
OF the total stock of money exclusive
gold backing sufficient for any emergency
or requirement: 1t. is a coincidence that
the gold backing provided for Bank of
england notes, the chief circulating me-
dunn In Great Britain, is approximately
DO 20 per cent the remainder of the
backing being government securities.
was 1oiloWed by revival of business
and an era of unprecedented prosperity
IN the United States and by an incalcula-
bic enhancement of the credit of the
United States in foreign countries. Mr..
smith believes that the adoption of the
gold basis for the whole stock of money
would further increase the prosperity of
the United States and further enhance the
credit of the United States in other coun-
tries.
Mr.. Smith proposes that all kinds of
money shall be interchangeable-tha the
new United States notes shall be ex-
changeable for gold coins, silver subsid-
larry CONS or minor coins (the nickel and
copper pieces; that gold coins shall be
eXchangeable for notes or minor coins
and that minor coins shall be exchange
able Tor notes or gold coins. Thus, gold
Will be the real money while the notes
silver coins and minor coins will be rep
resentatiye money. The cost of the notes,
SILVER coins and minor coins under Mr..
Smiths plan would be betrayed by appro-
prlatlon by congress as is now the case
WIN the various. forms of paper money
and the minor coins.
AS to the Banks.
National banks which are banks or
gained and conducting business under
the national bank act are permitted to
issue their own notes for an amount equal
eminent bonds deposited by them with the
treasurer of the United States. The gov
eminent imposes an annual tax of u per
cent on the notes when they are secured
by government bonds bearing Q per cent
interest, or a taxi of j. per cent when
secured by ponds bearing interest at
hlgner rate than per cent In addition
each bank issuing notes must maintain
with the treasurer a fund in cash equal
10 per cent of its note issue for the re-
dempt1on of such notes as may be pre-
sented to the treasurer. This per cent
may be counted by the banks as their re-
serves A bank cannot issue notes in
its notes by deposting with the treasurer
laWIul money that is, gold coin, silver
com, United States notes (greenbacks)
U NJ d ipe fen notes separate plate is
are printed and the result is a multi
pl1clty OF issues of national bank notes.
o,; IN order to provide for elasticity in the
national banks to take out circulation
receive from the treasury and issue
notes. as heretofore on the deposit of
ing them with notes bearing their indi-
Vlduai names as at present, he proposes |
10 supply them with United States notes
he would wholly dispense with the re-
compton fund as unnecessary and would
impose tax of per cent on circulation
taken out. bank is not now permitted
greater than its capital. Mr.. Smith would
permit circulation to be taken out to the
extent that government bonds might be
provided and likewise permit retirement
at Will He maintains that the per cent
tax would be high enough to restrict I'M
que expansion of circulation and to induce
especially as to the tax woul be added
deposited.
The operation of taking out and retir-
Ing circulation under Mr. Smiths plan
would be simple. On the deposit bv
banks OF bonds notes would be issued In
ton of no for h bnem and on the presenta
TO the banks owning them. The tax
on circulation at the rate of per cent
bonds no