The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1910-11-17
DIRECTOR OF MINT
OUTLINES REMEDY
Speech of George E. Roberts
Praised by Bankers.
ELASTIC CURRENCY DEMANDED
After Reviewing Monetary System
and It's Urgent Need of More
Money, He CharacteriEes TreaSury's
S0OO,0OO,OOO Reserve as Greatest
and Most Ineffective in the World.

I ]. Selwln Taft. who has just returned
from New York City. which he visited
as delegate Of the Washington Cham
Der Of Commerce 10 the national confer
ence on the currency problem held By
the Academy Of Political Science. said
yesterday that although there We're many
memorable addresses made at the vari-
Gus sessi0ns-in particular those OF Sena-
tor Nelson w. Aldrlch. Profs Lawrence
}. Laughlin and r. ". Kamerer, and
Paul NJ. Warburg and Jacob II. SchIff-
that made by George Z. Roberts. Director
Of the Mint. at the dinner OF the society
at the Hotel AstoF was regarded By a
great many OF those present as the most
notable. for the reason that il outlined
with great force and clearness a very
simple and adequate remedy for the cur
rency troubles. something the entire
financial world is urgently demanding.
The speech OF Mr.. Roberts was highly
praised by the bankers present as well as
by those speakers who followed him.
After reviewing the monetary situation
and the urgent need of more money and
more bank credit. Mr.. Roberts, whose
powerful advocacy OF the central bank
is known TO all. reminded his hearers
that the United States Treasury holds to-
day $500 0O0 gold against like amount
of gold certificates, a fund which ne
characterized as the greatest and most
ineffective gold reserve in the world.
Contrasted with France.
Mr. Roberts forcefuily contrasted the
very limited usefulness Of this reserve
with the ample sufficiency of that of the
next largest in the world, that OF the
Bank Of France-about s72O. 900. coo In gold.
/ in exchange for which notes are issued.
in contradistinction TO our own method of
issuing gold certificates.
Upon our present store Of gold he said
there could be built an institution as
powerful for the protection OF American
credit as the Bank OF France has been
| for, the protection OF French credit. To
accomplish this purpose the $500, ,Oo0. 600
of gold should be transferred from the
United States Treasury. under proper
| legal authority, TO, a central bank, which
should be under the joint control OF
| representatives Of the government and
of the country's banking interests.
The gold certificates should then be re-
tired and bank notes OF the central bank
should take their place. These notes
could be made good for all purposes for
which gold certificates are eligible, while
the gold fund Itself, on occasions OF
necessity, like monetary crises. could be
made the basis OF an issue TO the extent.
| Il may be, say, of an additional s450.
000,e00 OF notes, against approved COM
mercial paper, or 81, $50 000, 900 in all, and
i -, - afF.
belonging to the reserves Of the Bank Of
France.
Use as Safeguard.
| Such an organization, MIR. Roberts felt,
although analogous in some respects TO
the Bank of France. need not receive
| deposits from individuals, or even from
banks. its main object being to consoI-
date the country's gold reserve. in re-
sponsible hands, where It can be used to
] safeguard the entire banking situation.
One member from each of the first
thirty clearing houses leading in volum5
Of clearings would give an admirable or
ganizatiOn, and Mr.. Roberts felt that
there was no more reason to suppose that
such a body elected from all sections and
drawn from both political parties would
/ become involved IN partisan politics thar
| there is to expect our clearing houses &c
/ become involved In politics.
The fear which seemed to be In the
minds of so many that central bank
would sooner or later come under Wal
Street domination Mr.. Roberts disposed
OF In these words:
There is little reason to apprehenc
that under the management proposed the
resources of the institution would eve,
be loaned TO support stock market opera.
tions. but that evil could be effectually
guarded against by a proviso in the IaW
| that no part of the note issues shoulC
ever be based upon anything but golt
and short-time commercial paper"
Mr.. TAFT said it was noteworthy thai
at the different sessions held the bulk o.
the visitors seemed to be in favor of tn,
establishment Of a properly safeguardet
| central bank.