Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1903-09-03
"ASSET CURRENCY"
Financial Schemes of the Republic
ans Are Devoid of SOUND
Business Judgment.

The stand of Uncle Joe Cannon
against rubber currency" is evidently
having some effect on the republican
leaders, and it seems quite possible that
the asset currency" idea may be
dropped, and the scheme of loaning gov
ernment funds to banks without secur-
ity may be taken up in its place. A
very significant utterance indicating
this, says the Indianapolis Sentinel, is
made by the New York Financier, which
would hardly say anything detrimental
to Wall street interests, but it comedies
the general distrust of asset currency
as follows:
THE possibilities which a flood OF new
money invites are not pleasing to the ma
jority. Wall street has been its worst en-
envy in this particular. Treating wall
street as representative of the speculative
craze which has swept over the country
within the past several years, the reluct-
ance to open wider the gates of gambling
opportunity is not to be wondered at. The
solid interests of the nation view wan
street with apprehension. They see IN
currency expansion merely another inVl-
tation to a burst of speculative MANIA
with its inevitable diversion of the nations
wealth from its proper usages. Inc larn-
err and the merchant are not suffering be-
cause of any specific lack of money, They
have been hampered by the draining OF cur
rency into Wall street. Doubtlesslt WouiG
be a good thing for the farmer II, IN the
fall, when he really needs funds, his bank
could issue him negotiable notes on It's
,InJra1 u1larant1p to meet MS wants,
hut Instances where crops go to rum be-
cause of financial inability to harvest
them are rare indeed. The farmer gets the
money somehow, and Wall street has 10
stand back while legitimate needs are be-
ing satisfied. In a word, the feeling IS that
any considerable expansion OF currency
at this time would beneht speculative anu
not mercantile interests.
The truth of this will not be questioned
by many bankers OF business men VINO
have given any attention to the question,
and the belief of the general public that
asset currency" is a speculative propo-
sition is well founded, for there has not
been a scheme of issuing it proposed that
would not limit it's issue to the big spec
ulative banking institutions. But the
Financier further says:
eft congress will make it clear that the
treasury funds are not to be regarded as
a fetish; if it will confer on the treasury
the privilege of disposing of its current
funds as the merchant or manufactures
does, the great weakness of our currency
system will have been met. True, times
mey come when even such optional safe
guards will fail, but let us not forget
that, speaking in a general sense, prosper
ity is beyond the power of law to CONTROL
"Disposing of it's current funds as the
merchant or manufacturer does" means
putting them in bank, without security.
But the difference is that the government
funds are held for the protection Of its
credit in the stability of credit money,
anJ the utility of the funds depends on
their constant availability. Ifthey were
in banks, and were needed, the call for
them would a%ggrayate the need and
could not be met by the banks. During
the recent decentralization in Wall street,
the government has had over $151, G00,-
900 on deposit in national banks, mostly
in Wall street. 1t did not prevent the
decentralization, and if at the time the
government had called for it's money, "as
the merchant or manufacturer does,
it would have precipitated a general
panic.
The unsecured loan scheme is just as
fully a Wall street measure as the asset
currency scheme. The loans would nat.
urally be made to the big institutions
just as they are now, and would be used
to promote speculation. 1t would enor-
mously increase the power of the bis
syndicates which have just shown theil
power to control the market price Of
securities without regard to merit. Ant
the safety of the government would
be linked to their success, for If the
syndicate using the governments
money should get worsted in the con
test, the government would be out. Til,
scheme is not supported by a solitary
consideration of sound business judg.
ment.