The Birmingham age-herald., 1907-12-09
Certificate and Bond Issues
 Are Very Satisfactory
GOLD RESOURCES ARE HEAVY
Two Big Bank Failures During the Week Have Had No Influence Upon the General Situation,
 70 Which Is Sound.

New York December S.-The events of
 the past week in the financial world have
 been such as usually make the gradual return of confidence and the restoration
 of normal conditions in the banks The
 decision of the secretary of the treasury
 to issue only about s40,oO,000 of the $150,-
 100000 in new securities which he ex-
 pressed willingness to issue If condi-
 tions required, the disclosure of unusual
 ly strong reserves by country banks re-
 porting to the comptroller of the cur
 rency, the decline in the currency prem
 ium and the decline In the New York
 bank statement, have been important
 events of the week which have tended to-
 wards stability and reinsurance.
 The action of the secretary of the
 treasury, in limiting the issues of se-
 curites, was a part of the original plan
 recommended to him to meet the stua-
 tion by a resolute and adequate meas
 ure. but to carry the execution of the
 measure no farther than circumstances
 required. The result of limiting the is
 sue of the Panama per cent bonds to
 $25, 900 and the one year treasury cer-
 tificates to about s40,000,000 will be to
 considerably simplify the problem of
 treasury management and money mar
 ket conditions during the spring.
 Plethora of Money.
 It is anticipated by far-sighted bankers
 here that there will be a plethora of
 money soon instad of a dearth and it
 will be necessary to reduce in some way,
 the large volume of currency which has
 been brought into use during the crisis. The increase in money in circulation out side the treasury as shown by the monthly statement of the treasury depart
 ment for November, was $13i,S ,S72,SS7. Of | this amount the increase in gold in the
 country Is computed at about s72,000 0a0,
 including domestiE production as well as
 importation from abroad. The other prin-
 cipal form of increase is in bank circula- ! tion in which an increase of $7,533, ,521 was ] obtained by the disbursement of bank
 notes held in the treasury cash, and
 s46, 6,237, ,730 was obtained by actual in-
 crease in the notes issued by the comp
 troller and outstanding.
 There have been fears in some quar- l ters thati anything approximating $lOO, O00000 in new bank notes were issued upon the security of the new one year l certificates, the resulting imitation would
 expel gold in large amounts after the
 credits established by the crop move
 ment were exhausted. This danger will be reduced to a minimum by the rela-
 lively small issues made by the treasury and if small amounts in gold should be ,toI ,u fo1t tlaf thatF
 spared, in view of the large gold resources in the country, to which President Roose- | welt called attention in announcing the
 new loans.
 Total Gold on Hand.
 The total gold in the country reported l by the last treasury statement is sl,56l,- 1 714719, which is equal to more than 50 | per cent of the total money In circulation | Some further increase in bank circula- | ton Is expected here upon the Panama
 bonds and the treasury certificates, but | 1t is believed that the bonds will be de- posted in many cases as security for 1 the public money which has been left
 with the banks and will not be employed 1 as basis for circulation until the one
 year certificates are cancelled in the 1 spring, when money withdrawn from | banks by the treasury for the redemption 1 of the certificates will release the bonds 1 and the latter can then be substituted | for the certificates as security for cir | culation. If this proves to be the case. | the increase in bank circulation will not be very great during the next few | months and may even turn downWard | as soon as 1t becomes apparent that tho banks have large accumulation of cash for which there is little demand.
 Reports of Banks.
 | The reports of the conditions of the | national banks on December 3. which are being pushed in various localities and are gradually reaching the comptroller of the currency, are verifying the antici-
 patton of leading bankers set forth by the Associated Press week ago, that large reserves would be disclosed in the interior banks, that the dislosures would tend to restore confidence and that the ba nks would be willing to release such excess reserves after making their state ments. A rough calculation the re- ports of the Chicago banks including
 some state banks, indicates reserves of
 nearly 35 per cent. About the same pro-
 portion is reported from New Orleans and still higher reserves at smaller places,
 where the law only requlrse 15 per cent, including deposits in reserve cities. The fact that two failures of national banks
 oi a certain degree of importance have occurred during the week without appar-
 ently causing any shock to confidence, | even in their own Localities and still less in financial centers. is regarded here as another favorable indication of the state of the financial markets.
 Increase of Cash.
 The increase of $4G7l.O00 in actual cash in the New York clearing house banks l is regarded here as one of the symptoms that the currency crisis as such Is prac- tically over The reduction of loans by about Sl1, GOO. 900 Is also considered a fay- orable indication of diminished pressure. The increase in the required reserve by | se,779, 900 reduces the deficit in New York reserves to s46, ,210O00 and part of this will be covered by gold yet to arrive.
 Not much is expected among New York bankers in the way of currency 1egisla- ton by Congress at the present session. The fact that the presidential election Is ! approaching and that there is wide di- versity of view as to the proper form of new legislation. leads 10 the belief that this subject will only be considered without final action during the present session. The necessity of some important measure of reform Is quite generally recognized. but the growth of sentiment for a strong central bank Is checking in some degree the movement for giving wider powers of note issue to the ex- I