Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1907-11-24
NEW TREASURY
CERTIFICATES
DENOUNCED
CONGRESSMAN FOWLER
SCORES ADMINISTRATION
Declares Governments Effort
to Relieve Money Famine
LawIeSS BIunder Bound to
React on Legitimate Business
IBy Morning journal Special Leased wire.I

MAUI VII L6Slliiildl6D Duolll6oS
JBy Morning journal Special Leased Wire
New York, Nov. 23.-Representa-
tive Charles n. Fowler. chairman of
currency today gave out the following
statement regarding the issue of PAN
anna canal bonds and treasury reT.'si-
Gates.
Personally" said Mr. Fowler, "aud
from party standpoint, 1t is unplea g.
ant for me to disapproVe the action
of the republican administr ltlp1. but
my study of the questions involved
and my duty to the public, eomre II
me to set forth the reasons why he
action of the administration Is sur
prising, extraordinary unWarran;ed
and most unfortunate.
Unwarranted Action After Crisis.
"On Friday November 5. the crisis
of the present currency pauc had
been reached and successfully passed
through the splendid achievements If
the American bankers n bringing
gold to this country to the extent OF
about $75,000,000 dollars at 4 veIs
great cost to themselves. for il was
purchased generally at a pr mum Ct
about per cent, and also by respond
ing to the business necessi sIss % tic
various localities in issuln~ clearing
house certificates and cashiers eheciss
in denominations of 81, 81. 81 ard
SO. as well as the larger denorLna-
tiOns. At this juncture VIII IN the fiL
ancial and currency situation vas al
ready well I'm hand, the administration
intervened against the opiniol Of tie
best judges of the stul' ion. There
fore, primarily, the effect 0f the gov
ernment's action must be a most dis
turbing factor, although the bankers
of the country may prevent any seri-
GUS consequence at the movement.
Government Did Not Need Money.
I'm the second place, the govern
ment did not need the money, as II
has s24O.0Oe. eco to its credit which
was taken from the people through
taxation. Therefore, the interest
bearing debt Of the government should
not have been increased S150.000, O00
especially when such increase OF
debt is clearly I'm violation of the In
tent and purpose of law, and In the
third place, because the action of the
treasury Is a most violent violation Of
economic law, for which the people
must surely pay the penalty.
First, let us deal with the $50
100000 of 2 per cent Panama bonds.
which are 10 be used as the basis of
additional bank note circulation. The
government has, as stated, S240,000,-
600 In its treasury or to its credit,
and therefore II did not need the pru>
ceeds TO pay FOE the construction of
the Panama canal or 10 meet the cur
rent expendituIbs of the government.
And even If IL did II could not take
any part OF the proceeds of these
sales for the present. as the banks
could not afford to exchange their
reserve money for bank notes. And
further. because instead of there be
ing a margin OF gain, there must nee
essarily be a loss of capital in the
transaction. Again. by this hypoder-
mic injection OF s5O.000.O00 Of fiYed
immObile currency into our sodden
mass of bond secured bank note 'ir-
culation. which never responds to he
varying conditions of commerce, be-
cause not directly related to the + si-
ness OF the country. we have mac"
bad condition worse. Think OF push
ing farther a principle OF currency cx-
pansiOn which, although our business
was constantly expanding. from 1882
to 1891 fell from S362.000. 900 In 1882
to SIPS. 900. 900 i'm 1891 Why? Sim
ply because Il was Improbable to
hold the bonds for that purpose. Aye,
principle which has proved its ut
ter lack of adaptation to our needs
since 1891 by showing an actual con-
traction during the fall Of many OF
the intervening years and an actual
expansion during the spring months
Of many others.
Reaction Bound to Follow.
Again. we shall find when the re-
action comes and the changed condi-
tion is reflected In our reserves be-
ginning about the 18th OF January. II
not earlier. and increasing rapidly
during the spring months until the
reserves In our banks viii probably
exceed those Of any preceding year
since 1900-that this very Sl50, 0,000,-
000 Of unfortunately increased debt
shall be converted into bank notes,
that these bank notes viii not disap-
pear and be automatically retired:
but they will fine a place in the re-
serves Of the state banks. In the re-
serves of the trust companies and to
some extent-though they have no
right therein the reserves in the ma
tional banks.
VIII Drive Gold Prom Country.
Now. mark this that every bank
note held as a reserve VIII displace
just that amount Of gold and drive u
out Of the country. This is just what
our silver purchases ala from 1873
10 1894 The poorer money always
better. There will be upwards 81 one
per cent profit on the circulation
taken out on these bonds. and 50 the
banks will force them out persist
entity and the counternart viii be that
noiselessly. imperceptibly. but with
absolute certainty. the gold will give
niacc To the bond secured notes to
the extent that % finds its way into
the reserves OF the various financial
Institutions of the country.
During the next few months YOU
will note this striking contrast be-
tween these bond secured notes and
the credit currency expressed in clear
ing house certificates and cashiers
chec ks-that while the bond notes viii
~aulafn n perplex and curse us in the
future by not contracting 10 the eN-
ten - . single dollar from January
to July. every single dollar of credit
currency in the form Of clearing house
certificates and cashiers checks which
have come into existence naturally
with q great urgent need, will dissp-