The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-08-02

cess of that secured by government bonds
on deposit at Washington, to the extent OF
% per cent. of their capitalization. On this
the government would place a tax of per
cent. per annum, and on account of this
tax the banks would not make use of the
remedial measure except in times Of the
greatest stringency. Interest on loans
would have to be greater than per cent.
in order that a bank could make any profit
by issuing additional currency under the
emergency measure. The moment interest
rates dropped below per cent. the banks
would Immediately retire this currency.
The maximum amount of additional cur
rency that would be made available under
this plan would be $780, OOO,0 900, which is Is
per cent. of the total capitalization of all
the national banks in the country. Banks
availing themselves of this privilege to adj
ditional circulation would not be required
to put up any additional security. The
security for this circulation would be first,
the bank itself; and secondly, the fund
created in the United States treasury by
the accumulation of the per cent. interest
on this circulation. Experts say this fund
would be amply large enough to cover the
failure of any national bank having this
additional currency in circulation.
XXX
While some of the most influential Re-
publican senators in Congress are devising
means for relief Representative Cannon of
Illinois, who was successful the last ses-
sion in blockadng all financial legislation,
is said to be just as strongly against any
change being made in the currency system
1,xy
In a recent discussion of the currency
question in Washington Representative
Cannon is reported to have said that it
will require more than conference Of
three or four senators to determine the
character of financial legislation that shall
be considered by the coming Congress. A
leading financial writer in discussing the
currency question says:
1T may be true that the Western banks
will be able to provide funds with which
to move the crops, but, nevertheless, some
thing must be done to prevent the annual
strineency of the currency Of the United
States. Whether the bank currency of the
United States shall be based on credits or
bonds is one of the most important phases
of the financial question now before the
country, according to many leading bank
ers'
Il don't think there is any need of fear
that the money market of this country will
this fall suffer stringency like that of
last fall" said William j. Richards, presi-
dent of the Union National Bank. Money
is tight and rates are high, but the indica-
tons are, / think, that the great demand
for money with which to move the crops.
which will extend over a period of about
six weeks, beginning the first of Septem-
Der, will not have the effect of producing
such a stringency in the market that there
will be any need of worry lest the demand
will not be met and perfectly safe condi-
tons maintained. In fact 1 can't see any
indications that point any other way than
that the money market will be kept in a
safe and stable condition all through this
period. The conditions that had a great
deal to do with the stringency of the money
market last fall and resulted in Secretary
Shaw adopting emergency measures for the
issuance of circulation do not obtain this
summer and therefore the general finan-
cial condition OF the country is better than
last year. There is not nearly so much
money tied up in New York i'm stocks as
there was last year, and this is one way
In which the financial condition is improved
over the condition that existed at this time
last year / think rates have about reached
the level now. and per cent is as high as
the market will go. 1 think"
The experience of last fall. when money
was drained West to finance the moving of
the crops, sending call money in New York
fc cincr foo <sf -sx Ito.
conditions this fall in certain quarters. But
this fear is by. no means general. il is
thought and Of course there is certain TO
be a more pronounced stringency in the
market than obtains now. But this does
not mean that the condition will be any
ways near the dangerous point. Call
money in the East is plentiful. but time