The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1906-11-17
RUBBER CURRENCY
CALLS OUT TALK
Continued From First Page.

imposition of a higher tax than that
advocated by the controller Both treas
ury officials agree, also, that no deposit
of bonds or other securities should be
required to protect this emergency cir.
culation in case Of insolvency Of any
issuing bank, but that the tax collected
on the extra issue should be placed into
q fund for the redemption of notes Of
failed banks.
Many bankers and financial experts
agree with these two officials. Others,
however, advocate deposits of bonds OF
securities to secure these notes. An
other group wants commission ap-
pointed to take charge of this matter Of
issuing emergency currency, to which
applications for permission to issue
emergency currency should be made,
and which would have the authority to
say what banks should be permitted to
issue credit or asset or emergency cur
rene, and in what amount. This plan
is strongly objected to by what might
be termed the weaker, altho solvent, in
credit might be hurt because of their
having to apply for permission to put
out more notes. It is said that the
strong banks would Immediately take
advantage of this fact and would begin
to advertise themselves as not having
to issue additional currency; that they
are strong enough to carry on their
business at all times without having
to resort to an emergency issue. -
Central Bank Opposed. e.. 81
The committee representing the New
York Chamber of Commerce recon-
mended, as one way Of relieving the
periodical stringency in the money
bank, with branches in all parts of the
United States, to have charge Of the
entire business Of issuing and redeem
ing national bank notes. This plan has
been hooted at everywhere as savorins
OF a return to the plan of United States
bank, which Andrew jackson overthrow
and which resulted in many scandals
1t and the commission plan have been
rejected generally by all who desire
A see rsa phase 81 t Fsfof 5scn,,on
this question, after the general sisi apre Hn
ment that there should be emergency
notes issued by the national banks, is
as to whether they should be different
In form from those based on bonds
Some urge that, inasmuch as they would
| not be secured in any way, they should
not have on them the usual statement
that they are secured by bonds de-
posted in the treasury of the United
States. The objection to any distinction
between the two issues is that if any
distinction is made the emergency notes
might not circulate as readily as the
others, and the object of their being
placed in circulation would be nuf:
lifted. II .l..I.'33, y, -
Questions Of Redemption.
In connection with this imitation of
the. currency by the issue of bank notes
it is pointed out that facilities should
be afforded for the easy retirement of
the emergency issue, and congress will
be urged to remove the restriction lin.
deemed to $3,00o.000 per month. It Is
said that the limit should be placed at
three or four times that amount. Con.
gress will also be. urged to establish
redemption agencies at subtreasuries
and in some Of the. large cities where
there are no subtreasuries, SO that the
banks can get the notes into the re-
demption agencies within twenty -four
hours. At present the only redemption
agency Is In Washington, and most
banks won't &c, to the expense Of send
ing notes here, but pay them out again
as soon as they are received. . -.
The question of getting this emer.
one. that would appear to be impossible
to the lay mind, but the experts say
that both issue and retirement would
be practically automatic. A high off
cial Of the treasury department. ex.
planned features Of the proposed new
issue in this way: -
In the first place no bank is going
to issue any of this credit or emergency
currency until it is needed. That ie
in the crop.moving period in the fall
And only so much as is actually needed
into circulation, for the bankers them.
selves will. see to that, because of the
tax on it. They couldn It afford to pay
| a tax on their notes WHEN thu naono1,