New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-08-03
TO DELAY BOND ISSUE
FOR PANAMA CANAL.
Secretary MacVeagh Relied Upon to
.4scait a Favorable Market.


Washington, Aug. 2.-There has been gravs
anxiety in quarters because Of the fact that
the tariff bill authorizes issue OF 500 700
of Panama bonds. and It has been feared that the
| Secretary OF the Treasury by incautious issue
Of such bonds might unintentionaly depreciatc the
value Of existing per cents.
II may be authoritatively asserted. however that
Secretary MacVeagh. who Is business man OF
long experience. has such intention: that ne
will be governed In the exercise of the authority
conferred on him wholly by the exigencIes Of the
Treasury and the prospect Of a reorganization OF
the financial system Of the government after the
Monetary Commission reports next session, and
that the probabilities he will not avail himself
for the present OF any part OF the authority con-
feTred him to issue Panama bonds.
The tariff bill also provides that the Secre-
tary Of the Treasury may in his discretion issue
Treasury certificates 20 the amount OF SOo01oOdo
and there Is reason to believe that should the
working balance in the Treasury fall to a point
which required the immediate raising Of some sum
over and above the normal receipts the Secretary
would avail himself OF this provision rather than
of the authority to issue Panama bonds.
Such certificates. II Is provided shall bear inter
est at not to exceed per cent and shall reach
maturity within one year BY deferring such issue
for short time these certificates Of Indebtedness
viii not fall due until after the first collection OF
the corporation tax. payable not later than June
80 1910. and II Is estimated will. with the increase
in the customs receipts. tide the present def
bonds to maintain the working balance OF the
Treasury.
With tine immediate necessity for issuing Panama
bonds averted the Secretary Of the Treasury will
be at liberty to exercise his discretion In issuing
such bonds. to the end that they may be sold
under the most favorable conditions. Under exist
ing law all United States bonds may be deposited
with the Treasury security for circulation. and
all circulation secured by bonds which bear inter
est at rate not TO exceed per cent shall be taxed
at the rate OF One-half Of 1 per cent per annum,
while all circulation secured by bonds bearing In
terest at a rate in excess Of per cent per annum
shall pay tay of L per cent per annum.
The fact therefore. that the per cent bonds
may be utilized security for circulation which
shall be subject 20 tax Of not TO exceed One-haf
Of one per cent per annurn. while the new Panama
bonds when issued will doubtless bear interest az
a higher rate. will prevent any possible deprecia
ton Of the per cents.
The necessity for authorizing large issue
as s290.0OO,OOO was graveIy questioned by the Sec
rotary of the Treasury and by Senator Aldrich.
The expectation that the Monetary Commission
will report new method of issuing currency made
such an authorization seem undesirable, but Rep
resentative Payne maintained that II would be
wiser TO authorize the entire issue at this time. IN
amount sufficient to the total cost OF the
canal, that subsequent authorizations would
not be necessary, and in view of the complete IN
Outstanding which exists between the President,
the Secretary Of the Treasury and the chairman OF
the Finance Committee. II was decided that no
harm could result from intrusting such discretion
to Secretary AIacVeagh.