The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1907-11-29
ONLY IS MILLION
That Is the Limit on Issue of
Treasury Certificates.
COrtelyou Is Already Providing
Against Initiation.
FEARS TOO MUCH CASH
Increase of $50, 900, 600 in Bank
Circulation.
Cash Balance in Treasury to Be
FEARS TOO MUCH CASH
Cash Balance in Treasury to Be
Increased at Once.
Washington,

| increased at OnC0.
| Washington, Nov. 29.-The an
| nouncement by Secretary Cortelyou
that further subscriptions to the one
year treasury certificates would not be
received is regarded here as indicat-
| ing that the secretary considers the
crisis in the money market to be prac-
tically over. Official figures have not
vet been given out at the treasury Of
| the amount Of the certificates llotted
nor has it been stated whether further
allotments would be made for sub
Scriptions already received. The
amount of the allotmenrs made, how
ever, is said to be about $35,00O,000
and this is probably the limit unless
banks which have already made SUBJ
scriptions why allotments should be
made to them. All individual sub
scriptions having been rejected. 1t is
anticipated that nearly the whole of
the 35,000,00O. allotted will be used to
secure new issuas of bank notes. AS
these will be retired within less than
a year, they will not constitute a per-
manent imitation Of the bank note cir
culation.
future of the treasury resources and
of the money market Is already re-
ceiving attention at the treasury and
in banking circles. From present
sources OF lnIOrnallOn the amount
nominally added to the cash balance
of the treasury will be about SIS, 5,000,-
900 Of which $50,000.O0O will repre-
sent the per cent Panama bonds and
$35,000,000 will represent the one
year certificates which have been al
lotted. This amount would increase
the present nominal balance from
about $241, 3S3.217, where it stood
yesterday to q little more than $685.
100000. A small additional amount
will ~ 6arfxy inn mr.
the Panama bonds. but even II this
should average as high as five per
cent It would amount to only 33 mil
lion With a nominal balance. how
ever, Of more than 1925, ,0o0, eco the
treasury will not have anything like
this amount immediately avafla BILE.
This is because of deposits in national
banks and other deposit items. These
items amounted yesterday to $234,-
9S9. $50, Leaving an actual working
balance of $6.46S,628-
The Canal Bonds.
The secretary has announced that
80 per cent of the payments for
Panama bonds will be left in the Gus
tody of the national banks purchasing
the bonds. and about 76 per cent OF
the payment for the one year certif1-
Gates will be left with the banks. The
effect OF these changes in the treas
ury balance sheet upon the basis of
issues of both classes of securities to
increase the amount in banks to about
$780, 100000 and the working balance
to about $22,0O0.00O. The increases
of $4,000, 900 In the working balance
will be due to the retention In the
treasury OF fve million or ten per cent
of the principal of 30 millions In treas
ury certificates.
This condition of the finances will
be changed materially in the spring II
Secretary Cortelyou Is able to carry
q, nf
siderable portion of the one year GER
tiflcates before maturity. He will have
no difficulty in doing this and saving
a. considerable proportion Of the in
terest to be paid. on them If the agree
ments made with banks to this effect
can be carried out under the cond1-
tions of the money market existing in
the spring. II 80 million dollars OF
the certificates can be then paid off,
the balances will fall to about 295
millions, deposits in banks will decline
by three-quarters of the amount paid
off or to $277,500.0o0 and the cash
balance will fall to about fifteen mill /
lions. The loss in the cash balance
will be due to taking from the treas |
ury cash 20 per cent of the amount
paid for the retirement Of the certf- |
fcates. It seems probable, however, |
that money market conditions will be
such that the secretary will feel JUS
ti1ed In calling upon the banks for |
more cash than comes to |
them in payment for tho treasury |
certificates which are called and sur
rendered. Under these circum stances |
while the general balance would re- !
main the same deposits In banks !
would be reduced and the &C.
tual working balance would be in
creased. It is not only considered
highly desirable to reduce deposits in
the banks as soon az money market
conditions permit, but 1t fs believed
that there will be little difficulty In +,
doing so.
Reduction Planned.
If the treasury can reduce these de-
posits to the neighborhood OF 400
million in the course Of the spring,
II will then have at command about
100 millions as q working balance.
from which deposits could be made
from time to time to aid in the crop
in the autumn If they were ,
required.
The history of previous crises has
shown that money tends to accumu- /
late rapidly IN the banks sitter the
specie in national banks fell from |
20T,222141 on May 4th, 1898 to |
on July II, 1898. The
worst break in the stock exchange oc- |
Cured on July rs. when call money
went to Is per cent. Notwithstanding |
business depression was still acute |
and the contest over the Sherman acs
was still raging In congress- at the be- I
of October the relaxation OF
business activity led to the decline or
loans on October 3, 1898. by about {
s175. 100000 and this had its 1ogfcal
sequence in the accumulation of
specie in national banks to the .
amount of s224.7o3.se0 or an in
crease of about s9s, 100000 from the
the low point shown by the bank re- t
ports. In six weeks more or by the |
Of December 10, 1893. i
specie In national banks had increased i
TO $25126S.64s or by nearly $65.-i