New-York tribune., 1907-03-15
TREASURY AIDS AGAIN.
WILL REDEEM BONDS.
Money Market Relief of About
$1,000, 900 Aforded.

Washington. March 14-Secretary Cortelyou
to-day instructed collectors Of customs at places
whore 1t Is found to be desirable 10 deposit their
receipts with national bank repositories already
established In the same cities as custom houses
He also announced that he will redeem with in
terest "a July any registered and coupon per
cent bonds of 1907 to an amount not exceeding
S25.o0o.o0o The bonds may be presented al once
for redemption. He made the further announce
ment tnat under the circular Of October %.
1905, the $4,000 600 i'm circulation required TO
be reduced may he retained with the security
nov on deposit. Under these announcements
an' that which was made yesterday about $46.
ONoOh0 will be allowed TO remain I'm circulation
that otherwise would have been called into the
Treasury OF this amount $4,000 600 represents
public deposits temporarily placed with IN.
banks last fan under agreement that they should
be returned 20 the Treasury before February l.
1907, AMI $4,000 600 relates TO additional circu-
lation engaged for retirement. These amounts
with the $4,000 600 per cent bonds which the
Secretary offers TO redeem. make a total Of s7l.-
100000 either left with the banks or offered 10
be placed with them as the result of the re-
demDtiCn Of the bonds
REDEMPTION OF BONDS.
That portion Of the Secretarys announcement
which relates to the redemption Of the 4 per cent
bonds Of 1907. at price equal to the principal
and interest TO maturity is the measure intended
as the principal source Of relief 10 the money
market Holders Of the ~ OF 1907 will receive
Immediately on presentation OF the bonds to
the Treasury Department the full face value
and per cent additional. being the interest
from January l to July l. 1907 In many IN
stances. however. holders Of these bonds have
avaiied themselves Of the privilege given them
Secretary
due January and April l, 1907. so that the in
terest item is likely 10 fall considerably short Of
the 100000 which might have been paid under
this order had no interest been anticipated
Under the previous offers Of the Treasury 10
redeem these bonds some holders have been
reluctant TO part with them because OF the ex-
pectation that the government will open re-
funding operations az the time Of their maturity
In view Of the fact that there is now large sur
plus In the Treasury and more than S14O. 900 600
in the depOstary banks IT is apparent that the
government could redeem these per cent bonds
at maturity. If it so desired. by paying them off
in cash and without the necessity OF resortfne.
10 refunding at all. This fact may induce hold
ers OF the bonds to present them now to the
Treasury for redemption at the prices offered
The hrSt paragraph OF the announcement: re-
lates to the offer made by Secretary Shaw last
October 10 bring about some degree of elastic
ity in national bank note issues He permitted
certain depostary banks that had not vet
avalled themselves OF the full circulation prtvt-
ege 10 substitute certain approved state. mu-
ncipal and railroad bonds as security for pub-
lie funds deposited with them on condition that
the United States bonds thus released be imme-
dately pledged security for additional cir
culaton. Under this plan national banks took
out about $l6.O00O0O additional circulation.
fheV To
ized rate of $3OOOO00 a month. beginning with
March and ending with August 1897. On such
retirement these banks were Obliged TO replace
in their depositary accounts the United States
bonds which they have been permitted under
the order to use against their circulation with
drawing from the Treasury the state. municipal
and railroad bonds which they had been allowed
TO deposit. Under the Aldrich act however the
limit of retirement was raised from S3OOOOOO
TO $9O0OOOO a month. and. presumably ewing
to the high prices Of government bonds in the
market. engagements for the full retirement in
March have been made and S4.5OOOOO has baen
engaged for retirement in April and smaller nc
counts for succeeding months 1t Is believed al
the Treasury that this plan will keep in cir
culatiOn the full $l6OOOOOO originally engaged
for retirement although the privilege has been
given TO the banks to retire their circulation IL
they desire.
DEPOSIT OF CUSTOMS RECEIPTS.
The deposit of custom receipts. in accordance
with the provisions of the Aidsich act, is in
tended largely as a convenience to the collect
ors Of customs at places where there are no sub
treasures. The Sub-Treasury cities of New
York, Eoston, Philadelphia. Baltimore. Chicago.
st Louis, Cincinnati New Orleans and San Fran
CISCO therefore, will receive no direct benefit from
the action taken to-day. Other large cities in
clu1ing Buffalo. Cleveland. Syracuse. Rochester.
Pit;sburs. Detroit. Plattsburg Ogdensburg, Al
banv. Troy. Savannah, Atlanta, Portland. Me.
am approximately one hundred others. will be
directly benefited. 1t is expected that banks in
the cities named which are already depositaries
for government funds, will now receive the GUS
toms collections in the same manner that inter
Continued on second page.