Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1908-01-29
Today's Telegraphic News
Secretary cortelyou's Report.

measure taken, the Secretary ielt tbst
he was boupd to have regard not simply
to the operations of the treasury, but 10
their effect upon the financial condition
of the country. The present head OF
the department has not assumed thIs oo-
legation willingly aud would be glad 10
be relieved Of it, at least in part, by
suitable legislation"
In those words Secretary OF the Trea-
sury Cortelyou, responding today to The
senate resolutions OF inquiry, concludes
a Is. 600 word statement Of justification
for the radical methods he employed in
meeting the recent financial panic
and which have been SO bitterly CRITICS
ed by leaders of the minority party Ia
both branches Of Congress.
In a review OF the financial situation
since last spring, when he FIRST started to
meet q perceptible shrinkage 10 the cur
rency, by public deposits, Secretary
CorteIyou, in effect, claims from his sd-
ministrstion full credit for preventing
| disastrous panic.
"The issue of new securities by the
Treasury Department" he declares,
"wss Influenced by the conclusion that
lie was advisable to take some strong and
resolute steps which would convince the
nublic. both at home and abroad, that
the government was thoroughly alive to
the situation ADD determined to give Its
aid 10 every possible legal and proper
forn. The most potent weapon at such
times in bringing such conditions to ap
end ia often one Of moral effect, as OF The
definite action TAKEN"
His justification for "taking vigorous
action to arrest panic' Ia based upon
what he declares was a disappearance
in ak weeks after the suspension Of
the Knickerbocker Trust Company, In
October. of 1926, 125, 069, amounting
substantially, he says 10 one-tenth OF
| the entire money 10 circulation In the
limited States Of which burden more
| than two-thirds fell upon New York.
| BE ssys that the gravity of the situation
Uas further enchanced by the fact that
the pressure upon the money market
vas not localized in the United States.
| II was then, after enormous public
deposits had failed to check the adverse
current. that the secretary says he de-
cided upon his Issue of Panama canal
bonds and certificates Of Indebtedness.
OF this action the secretary says:
HWith balance of only about 3d.
600. 900. In actual cash, in the Treasury,
after setting off the necessary AMOUNTS
agsinst outstanding checks and other
similar liabilities, Treasury operations
could not be carried on with ease and
safety without additional funds.
II the measures to obtain such funds
conld he taken in such q manner as to
! restore confidence to the financial situs-
ton as we'll as to perform the more direct
service OF keeping the Treasury balance
adequate, it seemed to the secretary that
the adoption of a policy calculated to
. achieve these ends was not only within
the strict limits Of his legal powers, bet
was within his duty as responsible In
J some degree, under our existing fiscal
system, for the soundness and security Of
! the monetary situation.
The secretary says that 1t was with
deliberate intent" that the offer OF bonds
was made more attractive than that OF
{ certificates, the purpose being to avoid
: having money Withdrawn from the banks
! and to increase bank circulation. He
I defends his course in alloiipg the boUd'
> chiefly to national banks on the ground
= of proper reservation made. In his cir
: cular.
u He meets the charge of favoritism IN
.he d s.iihulion Of bonds by producing
records to show that they went to forty
+ states, and the certificates to eighteen
!. states located 10 different sections Of th'
/ country. In declaring that public de
: posits were made to meet business de
. mapds, and not merely to accommodate
: banks, the secretary says:
i "Tbe chief object Of the distribution o
a funds is not to afford a profit TO thu
bank as such, but to sfford to the bust
!. ness community the means to carry OF
70 transactions upon normal basis" BE
st SAYS that of the total amount OF public
deposits December 7, amounting t
1922, 1852, 252, the banks Of the State o
- New York appear as holders to thu
amount of 1858 per cent Of their capita
q and surplus, and the banks Of New Eng
), land, eastern and middle western States
D taken as a whole, including New York
show percentage of little more than Il
per cent, aud the banks Of the southern
Q western and Pacific States show q pro
\ portion of nearly Is per cent. Witt
: the elimination Of New York from th
. eastern group the percentage OF the re
. naming eastern and middle westerl
states is only about 1l.2 he says.
The secretary notes the recent with
j., drswsl Of $40, 900, OO0 from New Yorl
= banks, and announces "thst this will b
= followed by q call upon banks ontSid
of New York, which will be based upoI
local conditions rather thsn upon TIT
= payment of fixed per centage OF thei
q holdings of public money"
\ For the first tine the fact is mad
public that the Panama bond issue va
= oyer-subscribed more than A times, In
= bids sggregating 81, 22O, 6O4,6SO
/: Disastrous Fires.