The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1913-07-29
Accuses New York
Banks Of Depressing
Government Bonds.
SEEK TO DEFEAT
CURRENCY BILL
Secretary Hopes Movement will
Not Be Carried to Point Where
Department Will Have to
Take Action" n"-Business
Interests Will Be
Protected

Washington. July 2s.-secretary Nc
Adoo issued "a statement tonight fat
ly charging that the decline of govern
ment per cent bonds TO So 1-2,-a
new low record-was due almost
wholly to what appears to be a cam
paiSn wased. with every indication of
concerted action on the part OF a num-
Der OF influential New York city BANKS
to cause apprehension and uncasiness
about these bonds, in order to help
them in their efforts 10 defeat the
currency bill"
Banks throughout the country own
almost entirely 1T50Ss2.l30 OF the
per cents. Their market value to-day
was approximately 100000 less
than when the banks bought them.
Almost all the entire issYe is used as
security for Dational bank notes. Al
the present price. however. the dis
crepancy between the market value
and the Issues Of notes against the
bonds is covered by what is known
as Che 3 per cent redemption fund, de-
posted By the banks with the Treas
ury to care for rctirements OF national
bank notes.
still Worth Par.
Secretary McAdoo announced Il was
not his intention TO require the banks
to charge or the present depreciation
below par, but that the banks might
continue 10 put In the bonds at par in
their statements to the Comptroller OF
the Currency. at least "unt!l some o.
tcrial change in conditions should com
pei the adoption OF another course
In his statement Secretary NcAcoo
declared the per cents were worth
par. Notwithstanding their decline :n
the New York market. and continued: ::
THE idea seems TO be that the
country banks which hold about two
thirds OF the per cent bonds, and
culation notes, may be induced 20
unite with the New York City banks
In opposition TO the bill II they can
be made TO believe that the proposed
currency measure is going 20 lnjurc
these bonds and cause losses To the
banks. This Is. OF course. unfounded.
Meantime, II is folly for any bank
to sell governments IS at sacrifice. be-
cause OF any apprehended legislation
adverse TO government bonds. no
such lie egislation will result In the le4
years OF it's existence. the government
has kept faith scrupulously with its
creditors. and II is not going 10 change
its honorable character now II the
necessities OF any bank oblige II to
sell bonds at depressed prices. that. OF
course. is another matter-e matter
solely for the bank TO determine"
Their Worth Increased.
The seer etary said that not only had
nothing occurred to impair the value
OF the per cent bonds. but that the
aIhe ndment already adopted b. the
Banking and Currency Committee OF
the House enhances their intrinsic
worth:
Il. Because tho banks and all other
holders OF per cent bonds are given
n privilege not now possessed. OF cH
changing the 2s for 3s without the cir
culation rights, at the rate OF per
cent per nnnum OF their holdings. pres
ont or hereafter acquired. So long as
they do not make the exchange, they
may retain or sell and buy the per
cent bonds and exercise the circulation
privilege attached thereto.
"2. At the end Of twenty years the
government will pay at par and In
e. ~