Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-07-16
SHAW IS CRITICISED
ALLEGATIONS HE Is PLAYING
INTO CLIQUE's HANDS.

Wall street regards the fotaton of the
$30OO000O Panama canal 2 per cent loan
to be offered by the government this week
as assured, but not all the national bank
ers of Wall street are pleased with the
maneuvering on the part Of Secretary
Shaw In connection with the bond issue.
National bankers are never very out
spoken when criticising the Secretary OF
the Treasury, who is their superior officer.
but there has been much muttering Of late
over the Secretarys action In connection
with the favors he showed to the City Bank
on the treasury-assisted gold imports, and
there is muttering now over the shifts and
RESULTS Of public money and other per-
formances incidental to the Panama canal
loan.
At the very outset national bankers took
exception to that provision in the Panama
canal bond announcement that permits the
highest bidder to increase the amount of
his bid. On the surface this looks like q
well-intentioned effort on the part Of the
treasury to get the highest price possible
for the bonds. Yet critics of the Secretary
now fear that he has played, unconsclously.
of course into the hands Of a banking
clique which for long time has controlled
the government bond market. They point
out that members of the clique can put in
sealed bids. starting at, say, 104 and rum
ming down, and then that one or the other
OF these bidders may exercise the privilege
of increasing the bids. thus obtaining con-
troll OF the Panama bonds at a price that
best suits them.
Many Express Resentment
On Saturday, however, the feeling of re-
sentiment ran high with some bankers when
1t became known that the Secretary had
started In to boom the government bond
market at the expense of municipal and
state bonds. One bond dealer compared
the act ofethe Secretary In recalling public
deposits secured by state and municipal
ponds to the action of q stock jobbing
clique "cornering'' a stock. Banks are In
strueted to return public money secured
by class of security which Secretary
Shaw himself first approved of as adequate
security for public funds.
To recall this money now. but at tbe
same time to announce that 1t will be re-
deposited In the banks If thew substitute
government for Panama canal bonds. Is re-
gaSded as wholly unwarranted by some
bankers. Naturally 1t had the tendency to
aa ovtin the price Of government issues.
and brokers regard as smacking too much
OF stock 5obbing methods for the treasury
OF the United States. 1t is pointed out also
In government bonds and which made a
handsome speculative turn by the advance
In their price.
DO Lar as the special deposit of So 600 600
made In banks last March is concerned
bankers who have had these loans recalled
have little ground to complain. The de-
post was temporary and named July 10
as the day or repayment. The money was
put out on the terms that, being tempo
rary, the department will accept as Sc
curity satisfactory bonds on basis of
20 per cent on their value. However,
bankers now protest the calling Of these
securities because they inferred last March
that around July 10 the government would
require the repayment Of the $40 600 COO In
order to meet the heavy appropriation dis
brtrS onfc $3.50