Los Angeles herald., 1906-12-30
ShawSayS Percentage
Of Speculation
Is Small
Indignantly Repudiates
Charges Made by
SOutherner
Secretary of Treasury Explains Loans
of the Governments Money and
States Intent Was to Relieve
Legitimate Business
By Associated Press.

WASHINGTC Dec. 29-In letter
to correspondent at Nashville, Tenn,
Secretary Shaw repudiates the sugges-
ton that the United States treasury
ever has come to the relief of the stock
gamblers.
The correspondent, whose name is
withheld, insists tht the relief that has
been given gamblers and money sharks
"is the real cause of high money in New
York" The correspondence was made
public at the treasury department to-
day. The letter from the secretary
reads in part:
You seem to proceed on the theory
that the monetary stringency is caused
solely by stock gambling. In this you
are in error. Some people gamble in
stocks, some in cotton, others in wheat,
corn, pork, or lard, and some in land.
When times are good people will specu-
late in anything and everything that
possesses a market value.
1.-The proportion of speculation, as
compared with necessary and legitimate
business; is very small, however, and
probably is no larger in New York than
in Nashville, Tenn, where you reside,
or in Denison, Iowa, where l live. The
best estimates / can get place the
amount of speculative transactions in
New York city at from 21s to 5 pei
cent of the aggregate.
Never Relieved Stock Gamblers
"The treasury has never come to the
relief of stock gamblers and probably
never will, though the relief which the
treasury grants frequently aids those
who gamble on the bull side of the
market, but it is equally harmful to
those who gamble on the bear side.
Both bulls and bears importune the
secretary of the treasury, but the real
business situation is the sole conSidera-
ton.
'If you will stop to consider you will
realize that more money is needed when
the crops are being marketed, when
factories are filing their warehouses,
than when crops are growing and bus
mess men are enjoying their vacations.
There are more than $1,000 banks in
the United States. These are inde-
pendent of one another and each is try
ing to make dividends. Few of them
in midsummer make provision for the
fall They time their loans to meet
their obligations and take their chances.
secretary of the treasury Withdrew
$50, 100000 of the peoples money and
locked it up. This would have been a
crime if he were not willing to re-
lease it now when it is needed.
Facilitated importation of Gold
"By appropriate use of the money in
the vaults of the treasury have facili-
tated the importation of hundred
million of gold within the last nine
months and have released or arranged
for the release of fifty million more.
This was done also for the purpose of
aiding legitimate business, though it
has helped the bull side of the market
as much as 1t has damaged the bear
side. care as little for either of these
considerations as do you, but l am
intensely interested in the business in
terests.
Money is scarce. Some business
houses with international credit are
now paying per cent for money with
which to do their business. If money
could be secured anywhere beneath
the sky for less they would know it
and borrow it.
''It is for the relief of business that
the treasury has restored to the chan
nels of trade the money which 1t with
drew when the people had no use for
1t except for speculation 1t was then
wanted for speculation and | withdrew
1t. The last $10,0O0O00 deposit went
almost exclusively to the cotton pro-
ducing states and the exceptions went
to cotton buying cities"