The morning Astorian. [volume] (Astoria, Oregon) 1899-1930, 1904-05-08
ASTORIAN PUBLISHING COMPANY.
CLEVELAND BOND ISSUE.


The current issue of the Saturday Evening Post
contains an article from the pen of Grover Cleveland
explanatory of the bond issues which brought more
or less undeserved disrepute upon his administra.
tion Mr. Cleveland Thoroughly explains the causes
leading up to the issues and likewise goes into an in.
teresting explanation Of the gold reserve" and the
manner in which it came to be formed. The article
is well worth reading it gives an insight into the
conduct of our financial department that is first.
hand information for the ordinary citizen of the
United States
The gold reserve originated under the provis-
ions of an act of congress passed January H. 1875
providing for the resumption of specie payments
The law required the redemption and retirement of
United States notes, commonly called greenbacks.
All such notes in excess of $30000O000 were to be
retired before January l. 1879, and after that date
the remaining notes were to be likewise to be called
in and cancelled The law authorized the secretary
of the treasury to sell bonds to take up these notes
empowering him to accumulate sufficient gold to meet
the demands which would ensue when the green
backs were presentedfor redemption In compliance
with this act the mof about $92 100000 was real
led from the sale of bonds and an additional $41,.
100000 was obtained for surplus revenue After con-
greSS passed another act which interrupted the pro-
cess and provided that any notes thereafter redeemed
should not be cancelled or DESTROYED but reissued
and paid out again and kept in circulation At thu
time OF the passage Of this second act there were
outstanding greenbacks to the amount of about $347
0OO,0OO. Although the actual retirement of green
backs was prohibited their redemption in gold was
still continued, constituting an endless chain of gold
redeeming policy At the time when their further
cancellation was terminated there remained of the
gold which had been provided as a reserve the sum
OF 100000 900, and this sum has since been known
as the "gold reserve
Mr. Cleveland explains that it has become the
religious policy of the government to keep this gold
reserve up to 100000 although the gold reserve
is really made up of all the net gold held by the
government In 1882 congress passed another act
which provided that whenever the reserve fell below
Sl00OOOOOO redemption of greengacks should cease
Lately the reserve has been fixed at $1500000OO. Ii
The law which sought to maintain parity be-
ween gold and silver caused the subsequent trouble
4 administrations in keeping up the reserve to its
roper limits; and Mr. Cleveland rectes that when
le succeeded Mr. Harrison as president in 1893 the
eserve was then only 1923 410 in excess of the min
mum limit fixed by law. Then followed heavy de- y,
nands upon the gold reserve which once fell as low
s 100000 Mr. Cleveland appealed to congress
ut could get no assistance from that source and thu
ond issues were necessary to maintain the stability
our credit. He says that the bankers who made
he loan which created so much unfavorable comment
ctually lost money on the transaction
1t is evident from the very interesting article of
be former president that the financial status of the
overnment during his first administration was the
as pleasant OF his career at the head of this great
alton, and his statement will go far toward Grad
ating the popular belief that the money power was
ehind the bond sales