Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1907-11-19
Bankers Expect Normal Conditions
Within a Day or Two.
PLAN GENERALLY APPROVED
Issue of Short Term Obligations Not
Novelty Abroad,
LARGE SUBSCRIPTIONS PROBABLE
Ranks Expected 20 Take Panama
Canal Bonds as Basis Of Circula-
tion and General Investors
to Treasury Notes.

Of the government plan Of relief to the
market by the issue Of S5oO0O0W in Panama
bonds and SlG0CO0OGO in one-year treasury
certificates. Tho issue OF short time cer-
tihcates was more OF novelty and aa
such attracted more discussion. The gems
eral opinion Is that both measures would
tend TO draw idle money from private
boards and thereby hreak the premium
on currency and restore normal conditions
in the money market
So strong was this feeling that It was
understood that gold engagements would
practically cease after today. lntcrna-
tlonal bankers declared that gold already
engaged Is as much as New York can Justly
take from Europe under the strained COM
ditions which prevail there, and that 10
take more will only compel it's return at a
later date. II is not considered desirable
to force the Bank of England TO raise its
discount rate to s per cent as has been
talked of in London, nor to force the Ger
man rate any higher than * per cent,
which It has already reached
supply Needed Collateral.
II more gold were desired, the issue OF
short term certificates would afford just
the sort Of security which the Bank OF
France has been disposed 20 insist on in
direct negotiations through Mr. Morgan'a
house. The shipment Of gold to New
York against the deposit Of such certih-
Gates would parallel very closely the ship
ment Of Sl5OO0,OOO made to London at the
time Of the Barring panic in 1890. This loan
was secured by the deposit with the Bane
| of France of exchequer bonds issued 20
the Bank Of England by the British gov
| ernment in exchange for national debt
stock Exchequer bonds represent form
Of short term obligation which is issued
| frequently by the British government The
| issue of short term obligations has been
| less frequent with the American govern
| ment, but bankers declare that they will
| meet admirably the demands of the pres.
| ent occasion, because they can be talSeE
up and paid for at the expiration OF their
term from 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| can then be Withdrawn without danger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 precedent,
even II business depression is acute, be-
| cause after the first fright is over cash ac-
cumulates in periods of depression for
| which there Is little call for investment in
new enterprises.
Banks WIN bay Bonds.
! The response from the public to the offer
of new securities is expected to center
| largely on one-year certificates. The Pan
anna bonds. paying only per cent and SELL
ing at a premium are expected to 60 chiefly
to the national banks to be used as basis
for circulation. II the experience OF the
| popular loan of 1896 Is repeated. however,
in respect to the certificates. they will be
over subscribed several times. Secretary
Carlisle on that occasion invited subscrip-
tions for s1OO,OOOoOO Of per cent coin bonds.
payable after thirty years There was
grave doubt. under the conditions of de-
| moralization prevailing at that time, both
| in the money market and In the political
situation. whether the subscriptions would
| be sufficient to permanently restore the
| gold reserve. In anticipation Of this diff
| Guilty Mr.. Morgan organized syndicate to
| bid for the entire amount OF the bonds and
| eventually obtained about one-third, at his
price, OF the issue. The subscriptions OF a
bona fide character numbered L46O and the
| amount subscribed to cover the 800, 100000
offered was S56s, ,26ss5O. Subscriptions at
higher figures than Mr.. Morgans were sub
mitted for S66 7ss, $50 and barring defaults
| for trifling sums, bonds for this amount
were distributed in small lots throughout
the country.
| Large subscriptions Probable.
! II 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 change
Of money standard was confronting the
| country It is their belief, therefore, that
| subscriptions for the certificates are likely
to be large and to draw out much boarded
capital.
Secretary Cortelyou is counted upon to de-
| posit the proceeds OF both classes OF Sc
curities at once In the national banks, where
they will be available for the purposes Of
general circulation. The premium on cur
rency showed signs OF weakening today,
being quoted at from ~ to 2h per cent.
Bankers declared that It will disappear be-
| fore bids close for the treasury certificates
and that the monetary phase Of the crisis
/ will then tend to pass away.
Throughout the day reports circulated
with more or less defintenes6 that the
banking house OF ]. p. Morgan Wss organ
izing a syndicate for the purpose OF taking
over a considerable block Of the new treas
! ury issue, the amount being vaTiously
stated from SIS, 10000 TO SlOO,OOOOOo Late
| IN the day a member OF the firm gave q
specific denial to these reports, saying that
| he knew OF no such syndicate either 20
the Panama canal bonds or the treasury
certificates He added that no further ne
| gotiatons were contemplated for securing
j gold from the Bank OF France. Notwith-
standing this specific denial, the reports
continued to circulate that an organization
| OF fnanciers was contemplated 70 take up
a portion Of the proposed issues. but no
confirmation OF the reports could be Sc
| cured.
Bankers Say Move a Coed One,
Bankers, capitalists and finsncisrs here
| generally approve the action Of Secretary
Cortelyou IN issuing S5OOOO.OO0 OF Panama
bonds and SlO0,0oO.OoO OF certificates OF in
debtedness for the relief OF the financial
stringency. The issue, It was the general
opinion. is bound TO have beneficial results
Some OF the favorable expressions re-
| garding the governments action follow;
Leslie n. Shaw, president OF the Car