The Ellensburg dawn. [volume] (Ellensburg, Wash.) 1898-1914, 1908-01-28
THE CURRENCY
COMMISSION BILL
A Synopsis of the Two Bill
Now Pending in Congress

The currency commission of the
American Bankers association approve
neither the Aldrich bill nor the Fowe,
bill, already introduced in congress,
this year 1t recommends bill OF tn,
same general character as the measure
introduced by Mr.. Fowler about one
year ago. The commission stands
where it stood last september and pre-
viously thereto Last september the
commission submitted report to the
American Bankers association meet
ing at Atlantic City, and the assOcia
tion gave almost unanimous approval
The commission bill drawn in Chicago
last week follows the report closely.
Consideration OF financial legislation,
in congress has not advanced ia
enough as yet TO indicate any outcome
The currency commission thinks the
Aldrich bill to base additional note IS
sues on other than United States bonds
would tend to unsettle conditions and
is unsound because OF the fluctuations
it might cause in the price of state,
municipal and railroad bonds and Of
the temptation it would present for an
abnormal issue of such bonds.
The commission appears 10 lean to
the opinion that while the basing of
note issue on bonds should not be eX-
tended to other than United States Sc
curities at the same time it would he
unwise do do away with the system Of
bond secured notes altogether, as i
done by Mr.. Fowler's new bill. 1t Is
not unlikely that members of the com
mission look forward to a time when
note issues will not be founded on the
debt of the government, but think 1t
unwise to introduce so radical change
as Mr.. Fowler advocates it this time.
The currency commission bill oc-
cupies middle ground. Credit or
asset currency is introduced by an
thorizing any national bank which has
been in business one year and has a
surplus fund equal to 20 per cent OF its
capital to issue national bank guaran-
teed credit notes" These notes are
backed by the assets or credit OF the
bank. Such a bank may take out an
amount of credit notes equal to 40 per
cent OF the gOvernment-secureG bank
notes outstanding. The ak is to be "a
per cent every six months on such
credit currency. IN additional amount
OF credit notes equal to ~ per cent OF
the capital may be taken out, suhJect
to tax OF =: percent every SIX months
The commission takes into account the
possibility that the amount OF the
United States bonds may decrease ana
that the present proportions between
the total capitalization of national
banking associations in active operation
and the total amount Of unmatured
United States bonds may not be main
tanned. In such an advent the auth
Orized issue OF national bank guaran
teed credit notes shall be increased 10
corresponding greater percentage OF
the bond secured notes" In other
words, the percentage of credit notes
permissible would increase if the vol
ume of United States bonds unmatured
and out standing were reduced.
1t is seen that the commission is work
ing for the gradual introduction Of
credit or assest currency. Likely
enough it is acting on the theory that
no greater change in q long established
system of bond secured currency should
be undertaken at one time because o
the tax on the Irrational bank guaran
teed credit notes." they would not be
issued unless the demands of business
required, and for that same reason they
would be retired after the business
function, say 10 crop-moving period
was performed. Tacoma Ledger.
F. O. Bufilingame, who came over
from Chehalis, last spring and bought
VIM. Dignon's property in Sannyaldf
addition sold the same to }. II. Nc
Even not long since and will leave
soon for Lewis county, with his family
lssac Burns Of Tborp, was in the cit.
yesterday on business. He report
Thorp very quiet now.