Los Angeles herald., 1909-07-17
BOND RESOURCES
DECLARED AMPLE
REASSURING STATEMENT Is
MADE PUBLIC
Proposed Legislation Concerning
Bonds viii Deal with Meximum
Rate of Interest to Be Paid
by Treasury Department
(Rv Associated Press.l


WASHINGTON, July 16-The, bond
resources of the treasury are ample, de-
clares Secretary MacVeagh In a state
ment issued at the treasury late today,
and even if congress authorizes 8 per
cent bonds to cover the entire cost of
the Panama canal, less the amount al
ready issued, the bonds will only be is
sued as required.
The statement follows:
"The conference yesterday over the
matter of bond legislation in the new
tariff bill, was not held at the sugges-
ton of the secretary of the treasury
1.-The bond resources of the treasury
department are at present ample, in
Guiding $45,000000 of unissued Pa3ama
bonds and $100, 100000 of unissued 3 per
cent certificates.
Asked Departments Views
"The finance committee of the sem
ate decided to let the matter go over
until the next session of congress, when
it was supposed the banking and cur
rency question would be considered.
This decision of the finance COM
mittee was acquiesced in by the treas
ury department because 1t was mat
ter of comparative indifference to It,
The consultation yesterday was due ia
the fact that the question had come
up for consideration before the con-
ference committee and the treasury de-
partment was asked for its views
"The preference manifested for an
authorization of 8 per cent bonds to
cover the entire cost of the Panama
canal less the amount of Panama bonds
already issued was entirely acceptable,
as it would confirm the policy of pay
ing ultimately the entire cost of the
Panama canal out of bonds. 1t goes
without saying that even If such au-
thorization is made, the bonds will only
be issued as required.
"This explanation is made because of
some misunderstanding of the attitude
of the treasury department"
Left to Secretary
The three per cent interest is q, min
imum proposition, the purpose being to
authorize interest of not to exceed 8
per cent. This is regarded by those
concerned in the plan for bond author
ization as better than a fiat limitation,
permitting as it does, the fixing of less
than per cent if found feasible, While
meeting the objection raised as to the
present non-marketability of such
bonds at such a low figure as per
cent.
1t is left to the secretary's discretion
within that maximum limit and in case
the issue of any part of the amount is
determined upon at any time or from
time to time, the marketable conditions
of course will govern.
The provision in the proposed legis-
lation that will govern the tax on cir
culation will follow the existing law.
National banking associations having
on deposit United States bonds bearing
per cent a year interest, including
the bonds for the construction of the
Panama canal to secure it's circulation
notes, have to pay the United States
treasurer in January and July a tax
of one-fourth of 1 per cent each half
year upon the average amount of sucn
of it's notes in circulation as are based
upon deposit of their bonds. On such
bonds paying more than per cent in
terest, the tax is one-half of per cent
each half year.