Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1906-12-19
ESTABLISHED 1925
Wednesday, December 10, 1906.
Secretary Shaw and Currency Reform.

Secretary Shaw and Currency Reform.
Secretary Shaw, in relieving the de-
mand for currency has not deemed it
at all essential to send the Government
money into Wall street. On the con-
trary he has taken the ground that it
is better to place the funds where they
will be the soonest available to relieve
a lack of currency. For instance it
has frequently happened that the cot
ton and agricultural states have suf-
fered from a lack Of crop moving
money. This need of course is a tenn
porary one. When the crops have
been moved the banks in these sections
have had more money than they could
dispose of under normal conditions of
business absorption, and the surplus
has drifted naturally back into the
great money centers.. Secretary Shaw
believes that it Is better to make de-
posi.s Of government funds to relieve
currency famineS'' in the sections
where such "famines' exist. While
the cotton crop is being moved such
funds are deposited in Southern banks,
and when other crops are being for
warded to the markets. such deposits
are placed where they will he the most
immediately available for the needs of
the sections affected. 1t is the judg-
mcnt of Secretary Shaw that il is bet
ter to put i'm his money supplies cat
the head of the creek and let them
flow back to the great ccnters through
the force of financial gravity rather
than to start it at the great ccnters
and take the chance of its being
pumped back into the agricultural sec
tons i'm the stress Of crop moving de-
mands. Results have certainly justi-
fed the wisdom of the sccretary's pol
icy.
vious need Of q greater elasticity in our
national supply of currency, which will
enable it to adjust itself to the needs
Of crop :niving, and other special de-
mands, without the entervcntion Of the
Treasury department. 1t is UNDER
stood that plan to provide such clas-
ITCHY in the currency has been agreed
upon by the American Bankers AS
socia!ion, and will together. with a
humber Of other bills. designed to Sc
cure the same result, be presented to
the attention Of i Congress. As the
matter has been favorably urged upon
the attention Of Congress by President
Roosevelt some: practical legislation
MAJ be looked for
In this connection it is well to re-
member that there is vast difference
between an elastic currency capable Of
adjusting itself to crop moving and
other special demands-and every dol
lar as good as gold-and an inflated
currency in excess. during the greater
the country and carrying with it a
sllrinkage in all values because of the
governments inability to maintain it
upon a gold basis.
This country has today more than s33
per capita in circulation, which is by
far the largest per capita circulation
in the history Of the country
This. under. ordinary conditions is
sufficient to do the money work of the
nation. even at The present high tide Of
prosperity. Thherc are times, however,
when there are special demands for
currency particularly during the crop
moving period. AZ soon as these de-
mands have been met money quickly
finds its way back into the banks and
is 'casy" once more. UnquestiOnably
Secretary Shaw has shown excellent
judgment in placing government funds
where they would serve as relief to
currency stringency in periods of
special stress. He will it is under
stood. place before Congress a plan for
providing needed elasticity in the
currency. which he believes to be safe
and practical and which WILL undouDt-
cdly, hc accorded careful considerati ton