New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-08-01
SENATE COMES TO
Aid IN 5 MINUTES
Passes Aldrich Vreeland
Act Amendment by
Unanimous Vote.
TO BE ACTED ON
BY HOUSE TO-DAY
Country Never in Better Finan-
cial Condition, Say Senators,
but Act Is Precautionary.
Iron The Tribune Bureau

y
rFrom The Tribune Bureau
Washington, July 31.-To relieve any
financial stringency that may result
from the war conditions in Europe, the
Senate resuscitatcd the Aldrich-Vree-
land currency act to-day and amended
il TO enable the national banks OF the
United States TO obtain emergency cur
rency. The Aldrich- Vreeland act was
passed in 1912 and continued in force
by the federal reserve act until 1915.
Evidently acting upon advices from
the Treasury Department, which re-
fiected the feeling Of Wall Street bank
ers. the Senate Banking and Currency
Committee convened hastily late to-
dav and in five minutes decided unani-
mously TO report bill without follow
ing the usual parliamentary course OF
having it first introduced. Five min
utes later the Senate had passed the
measure. Similar action will be taken
by the House tomorrow.
The amendment, which authorizes
the waving of one of the restrictions
which would have prevented many
banks from complying with the re-
ouirements for obtaining emergency
currency under the Aldrich-Vreelsnd
act. is as follows:
provided, that whenever IN his
judgment he may deem it desirable, the
Secretary Of the Treasury shall have
power to suspend the limitations i'm
posed by Section l and Section OF the
act referred TO in this section, which
prescribe that such additional circula-
r,tria h0nnS
of the United States, shall be issued
only to national banks having circulat-
ing notes outstanding secured by the
deposit of bonds of the United States
to an amount not less than 40 per cent
of the capital stock of such bank, and
may permit national banks, during the
period for which such provisions arc
suspended, TO issue additional circula-
ton under the terms and conditions OF
the act referred to-"
Measure Called Protective.
Explaining the purposes of the
amending bill, for the passage of which
discussion on the trade commission
bill was suspended, Senator Owen
said:
81 am authorized by the Committee
on Banking and Currency to ask the
Senate to proceed to the consideration
of hill amending the Aldrich-Vree-
land act. so as TO enable banks which
have not 40 per cent Of their capital
invested in United States bonds and
circulating medium issued against it
to receive emergency circulation under
the Aldrich- Vreeland act by the con-
sent of the Treasury Department. The
stock exchanges of all Europe have
been closed. The Bank of England has
suspended specie payment, the Bank of
France has suspended specie payment,
the Bank of Germany the same, and
there is a possibility of some disturb
ance in our country unless we take i'm
mediate steps against it.
al will say that many Of these large
banks, banks which are holding the
reserves of the country banks, have
not thought it desirable to have a
large volume OF United States bonds,
but those bonds are practically alb
sorbed now by the banks; S720,000,000
of them are held as security now by
the government of the United States
for circulation and for advances made
to national banks. So there is very
small volume of them available.
81 therefore ask, in order to protect
the country, that we may have imme.
date consideration OF this measure"
Mr.. Smoot-Mr. President, should
like to ask the Senator from Oklahoma
if this is a bill which is expected to
be passed upon by the other House
tonight?
Mr.. Owen-Possibly so. The House
committee is now considering the mat
ter.
Fearing that the hasty action Of the
Senate might be misinterpreted, Sen
ator Smoct added: "Of course, my
opinion of the situation in the world
to-day. perhaps would justify this
hasty action on the part of Congress.
I have, however, thought that rather
than to quiet the fears of our people
this would precipitate hasty action on
the part of many, thinking, perhaps,
that the financial affairs of this coun-
try were in such condition that action
Ct this kind was absolutely necessary
TO protect the banks.
Nation Never So Sound.
Tf the people felt that it would
protect the banks and had absolute
confidence in them, of course there
would be no evil effects, but II the
bill is acted upon this way and an
idea should spread throughout the
country that our financial affairs were
in such condition that immediate &C
ton should be taken upon them and
that the banks themselves were not
capable of meeting their obligations, |
am afraid il would have the opposite
of a ouieting effect"
81 agree with the Senator from
Utah in that respect" said Mr.. Owen,
"but | should like to say in connection
with the suggestion and as to the con-
dition of the country that the nation
never was in such a magnificent con-
dition to meet this worldwide dis
turbance as it now is. We have over
81 800 .OO0,O0 of gold and silver in the
Treasury in our trust funds. Besides
that we have $4,000 900 of reserve
gold. We have in addition to that
$3.50. 100000 Of free gold in current
funds of the Treasury.
"The banks of the country are in
splendid condition generally, but to
have them know that il they need II
they can get s500,000,000 Of emergency
circulation will absolutely prevent any.
body demanding currency, for they will
not want it. The mere fact that they
know they can get it will be all that
will be necessary"
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