The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1910-09-01


tion, Then application was made BY
the publishers of the Commercial and
Financial Chronicle of New York for a
new ruling on this point. There mus,
have been "hunch' somewhere tC
the effect that the treasury was ready
in the interest of excusing itself for It's
emergency currency expenditures to
make a new ruling. That ruling is in
| cluded in the following letter:
TREASURY DEPARTMENT.
Washington, August 22 1910
William B. Dana Co. Publishers The
Sommerclal and Financial Chronicle.
p. Q. Box 95S. New York City,
Gentlemen:-Replying to your inquiry
as TO the Interpretation placed by this
Department upon Section 8 OF the Act OF
May 30, 1908. In the matter OF the re-
demption fund TO be held In the Treasury
on account of additional circulatin notes
OF national banks issued under that Act.
beg to inform you that In the opinion
OF Secretary MacVeagh the trainers OF
maintenance OF a redemption fund for
the emergency circulation equal TO the
fund held in the Treasury for the re-
demption OF the regular circulation as
provided by the law OF 1874.
II does not seem probable that the re-
demption fund provided In the Aldrich
Nrc0l0nd law Tor the emergency ClrCNlq-
ton was Intended to be double the re-
demption fund provided for In the case
OF ordinary notes In the case OF addl-
tional notes Issued through currency
association there is obviously less need
for increasing the redemption fund than
there would be In the case Of the regu-
lar circulation, inasmuch as the assets
Of all the banks belonging 10 q national
currency association are liable for the
redemption of the additional notes OF
each of the banks belonging to that
association. The Department. therefore:
is OF the opinion that Congress Intended
only TO extend to the additional cur
rency the original provisions for per
cent redemption fund hitherto provided
for the ordinary bond secured e,i,i & eircuia-
ton. Very truly yours
A. PIATT ANDREW,
Assistant Secretary.
This letter absolutely nullifes section
6. II SAYS that the banks are not re-
quired TO make any FIVE per cont cad
ditional' deposit, such as the law
plainly states they must do. The
emergency currency then would be put
on precisely the same basis as any
other currency so far as redemption
deposit is concerned.
The letter states that cit does not
seem probable that the redemption
fund provided in the Aldrich- -Vreeland
law for the emergency circulation was
intended to be double the redemption
fund provided for in the case of the
ordinary notes. But whether that
seems probable to Mr. Andrew or not,
the fact remains that the law says
exactly that. The fact is, further,
"A nf
currency was based upon
the proposition that this emergency
currency was to be issued only in time
of great stress and currency famine,
and was to be retired as fast as
possible when the crisis had passed.
Therefore, certain agencies were de-
vised and expressed in the law for the
of the retirement of that
currency. Among the other agencies
was tins requiring Of the deposit of an
additional five per cent of the currency
in the Treasury. Obviously this would
be a means for eXpediting the retire
ment of that currency, precisely as the
law expected and contemplated should
be done
ii is certainly not in the interests of
-he supremacy Of law to have the plain
equiremcnt of the statute set aside by
executive Interpretation In this way,
md it is not in the least likely that the
courts would uphold any such interpre-
,atlon us that. The Treasury s inter
oretation of this section until now
has been precisely as the section
'ead, and precisely in accord with the
obvious and declared intent of the cur
rency law, which is TO provide an
currency for a financial
'risis, which currency should be re-
iired as rapidly as possible after the
,risis had passed. The construction
,ow put upon this section by the Treas
Try absolutely nulifes the law and sets
lside it's plain intent, and this ap.
oarently merely for the purpose of
'arrying the Secretary's IS point of hav-
ng the banks take hold and help him
)ut of his dilemma