The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1903-08-07
Mr.. Aldrich's Committee.

Messrs. Aldrich, Allison, spooner and
Platt (Connecticut), constituting the sub
committee appointed by the senate
finance committee to devise and report to
the full committee a new financial meas
ure to be brought in at the extra ses-
sion Of congress in November, have met
at Senator Aldrichs Rhode Island home,
with an intimation that they mean
business.
The president has been very insistent
upon the consideration of this subject at
the extra session, altho objection was
presented that there being urgency de-
manded for the subject matter of the ex-
ira session, there would be little time to
discuss such serious matter as a meas
ure to meet the need Of the country for
an elastic currency, safe and unimpeach-
able. The action of the senate commit
tee was induced, more by the desire to
head off the house which WILL being a.
new body, have to organize new commit
tees, and Is known to have a good sup
port for the proposition not to tie down
bank circulation exclusively to govern
ment bond security but to permit it's
regulations to meet the exigencies of the
money market. The propositions which
are likely to be considered at Naragan-
sett Bay are to amend section 5153, Re
vised Statutes, by accepting as security
| for government funds deposited with the
| nat ho,, !
bonds, but "otherwise," as the statute
| reads, meaning state, municipal and rail-
way bonds of the very highest quality
with unimpeachable records of no default
and net debt strictly limited, the banks
to pay IA per cent interest for use OF
money deposited with them and the gov.
! ernment's claim being a first lien. A
further proposition is to issue an emer.
gency circulation up to 20 per cent Of
| the circulation secured by the banks
| its retirement when the occasion fol
| which 1t was issued no longer exists. Ir
! the German Reichsbank, If any notes are
issued above the amount the bank is al.
lowed by law to put out without specia
| security, they must be secured by specie
treasury notes or the unimpeac ablt
notes Of other banks, and, unless the sur.
plus notes are so secured, tax Of pei
cent is imposed upon them by law. Ir
time of money stringency Of a severe
| character this law is always available
for relief and the emergency issues are
speedily withdrawn as soon as they are
no longer profitable That is automatic
expansion and contraction. When the
ordinary supply Of money is exhausted
and borrowers are willing to pay higher
| rate for loans, the money Is forthcom-
ing. This is very much, more sensible
than to rush all the money to cover as
soon as a sharp stringency comes, as was
| the case in 1898, here.
The willingness of Mr. Aldrich to make
state, municipal and railway securities
security for government funds deposited
with the national banks, from revenue
| and customs receipts, is practically nc
more perilous for the safety Of nationa.
| bank currency secured by such bonds
|
national banking law. There are, how
ever, sharp. divergent views on every
proposition which is made. The Wiscon.
sin bankers yesterday denounced branch
banking. The other day the Minnesota
bankers denounced asset currency, an6
so on AS business nation, we shall
have to get together some day in suffi-
cient force and answer the query made
by Mr. Jacob Schiff at the New York
chamber Of commerce banquet as tt
why money rates should hold at 10 pei
cent or more for over week in New
York.
Let it be called something beside.
elastic" currency, if you WILL make
what rational compromise you can, bu
the country must have currency respon
sive to the actual needs Of business, ant
no patchwork business in it. To asser
that we can't have a sound currency fit
ting the needs of business. is to stultif.
American genius.