The Montgomery advertiser., 1907-11-19
BETTER TONE
 IN FINANCES Governments Relief Plan
 is Popular. IDENTIFICATION <A'Anrs Engagements Of S.d Will Probably
 Nisassd. Reports Been Circulated That J. F.. | san's House Will sub- scribe Bis Block of the
 New Bonds.

New York, Nov. Rehabilitation
 was the prevailing tone in banking
 circles today as the result of the gov
 ernment plan of relief to the market
 by the issue of $5o,0O0,o0 in Panama bonds and $100,000,000 in one year
 treasury certificates.
 The issue of Panama bonds had been
 counted upon as a probability, since
 it was first referred to some ten days
 ago. The issue of short term certifi-
 cates was more of novelty and as
 such attracted more discussion. The
 general opinion in banking circles was that both measures would tend to draw idle money from private hoards and thereby to break the premium on currency and restore nomal conditions in the money market.
 So strong was this feeling that 1t was understood that gold engagements would probably increase after today. International bankers declared that the gold already engaged is as much as New York can justly take from Europe under the strained conditions which prevail there and that to take more will only compel it's return at a later date. The amount already taken or engaged, approaches $70,0OO ,OO0, which
 is more than the most sanguine pre-
 dicted at the beginning of the move | ment about three weeks ago. It is not considered desirable to force the Bank of England to raise It's discount rate l to eight per cent as has been talked | of in London, nor to force the German ! rate any higher than seven and one- | half per cent, which it has already | reached.
 If more gold was desired, the issue of short term certificates would afford | just the sort of security which the Bank of France has been disposed to | insist upon in the recent negotiations | through MT. Morgan's house. The ship. ment of gold to New York against the 1 deposit of such certificates would l parallel very closely the shipment oi l si6, 600 900 made to London at the time l of the baking panic in 1880. This loan l was secured by. the deposit with the l Bank of France of exchequer bonds is. | Sued to the Bank of England, by ths | British government, in exchange fol | national debt stock.
 | short Term Obligations. | Exchequer bonds represent a form of | short term obligation which is issued very frequently by the British govern | ment. The issue of short term obliga tions has been less frequent with the American government but bankers de- | clare that they will meet admirably the | demands of the present occasion be- | cause they can be taken up and paid | for at the expiration of their term from l the treasury cash balance. which can then be withdrawn without danger | from the custody of the national banks
 An excess of cash will be on deposit | in the banks according to all past pre- | cedent. even If business depression is | acute, because after the first fright is | over, cash accumulates. in periods of | depression for which there Is little call for investment In new enterprises The response from the public to the 1 offer of new securities Is expected to center largely on the year certificates. | The Panama bonds. paying only per cent and selling at a premium, are ex- | pected to go chiefly to the national
 banks to be used as a basis for circu
 lation. If the experience of the pop
 ular loan of 1896 is repeated, however.
 in respect to the certificates. they will l be over-subscribed several times. If is declared by bankers that financial and | political conditions are infinitely more favorable at the present time than they | were when the gold reserve was almost wrecked and the possibility of a chance l Of money standard was confronting the
 country. 1t Is their belief, therefore,
 that subscriptiops for the certificates
 are likely to be Barge and to draw out l much hoarded capital.
 Secretary Cortelyou is counted mon to deposit the proceeds both classes Inf securities at once fin the nstioro banks, where they ,7ilI be avaiIshIe
 for the purpose of general circuIation The premium O. currency showed signs
 of weakening today. being quoted at
 from one and a half to two and a half per cent Bankers declare that it will disappear before bids close on the treas
 ury certificates and monetary phase
 of the crisis will then tend to pass away. 
 To Subscribe Bonds.
 Throughout the day reports circulated
 with more or less dehniteness that
 the banking house of J. P. Morgan 6, Company was organizing a purpose of
 taking over a considerable block of the
 new treasury issue, the amount being
 variously stated at from 5000 to
 $1e0, ,000, ,OO0.
 Late in 'the day a member of the
 firm gave a specific denial to these re-
 ports, saying that he knew of no such
 syndicate either as to the Panama
 Canal syndicate either as to the Pana-
 ma canal bonds or the treasury certifi-
 cates. He added that no further nego-
 tiations were contemplated from se-
 curing gold from the Bank of France,
 but, Notwithstanding this specific de-
 nial, the reports continued to circulate
 that an organization of financiers was contemplated to take up a portion of
 the proposed issues, but no conflrma- tion of the reports could be secured.