Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1916-05-20
CARRANZA MAKING SINCERE EF-
FORT TO ESTABLISH MONETARY
SYSTEM ON GOLD BASIS.
BANKERS HOLD BACK
THRU FEAR OF GRAFT
Crooked Work Among carranza Off
eiaIs Believed to Be Going on-car-
rama Credited With Honesty Of
Purpose But Lack Of knowledge to
Deal With Financial Crisis. g.,
Especial Correspondence

! Washington, May 10. American
! financial interests in Mexico are con-
! cerned, and the diplomats are taking
| interest, on account of the newest
financial plan that has been UNDER
I taken by the Carranza government.
Dispatches from Mexico City and
! other points, supplemented by infor-
ma ton that has been received In
Washington, have caused great anX-
iety. On one size Is the fear that
Carranza is preparing TO mobilize the
har money resources of Mexico, pos
sibly with the view TO getting ready for
war: on the other, the fear that he
may take liberties with banking insti-
buttons IN his country, in a fashion
calculated to threaten bankers with
serious losses. -.,
AS the CarranZa monetary plan Is
outlined here, on the basis of infor-
nation from various sources, 1t Is un-
derstood to be something like this:
First ii is realized that the present
deprec tation Of Mexican paper money
Is one of the worst features in the
Mexican situation. So, very naturally.
the effort is to be made to reorganize
the money system, and establish gold
reserve large enough to maintain the
gold basis. This would in Itself be a
most laudable performance, and one
in which, if there were a government
in Mexico able to command general
confidence. Caranza might reasonably
expect the support Of foreign and con-
servatiVe elements
But the present Carranza admins
tration does not command that corn-
dence. 1t is gathered that the plan Is
to call in all the present currency rs
sues. and to substitute for them a ma
tional circulation. based on a reason
able gold reserve. The first problem
is to get the stock OFF gold for re-
serve. 1t is not known how much golu
coin and bullion the Mexican govern
ment has in its possession at this time:
but the amount is presumed to be
small.
Gold in Hiding.
On the other hand there Is a good
deal Of gold still in Mexico. The coun-
try's foreign trade has prospered quite
,marvelously considering the turbulent
domestic conditions ofgttheR last four
years. Gold has been forced into hid
ing but has not left the country in very
great quantities. There are some au-
thorities that insist the country has
produced more new gold than 1t has
exported. even during the, revolutionary
period. and that If It could only be
brought out OF hiding there would be
an ample supply OF the yellow stuff,
plus the big stock Of silver, which just
now is rising fast in price, ito afford a
solid metallic base for remarkable
money system.
The other day dispatches from Mex
leo reported that the federal treasury
authorities. under the lead OF Louis
Cabrera minister of finance. had called
on all banks in the country for very de-
tailed statements showing their exact
conditions. and. among other things.
the amounts of cash. and OF silver coin
and bullion on hand.
Some of the banks are reported de-
termined to oppose making detailed
showing. because they fear the next
step. This step it is understood, will
be the retirement Of present paper Is
sues and the substitution Of a new is
sue of $500. 900. 900 or $500. 0o0.0 900, to be
based on gold reserve. This gold re-
serve 1t Is gathered, is TO be secured
by the pleasant process Of COM
Wandering the banks: requiring each
institution to put up a certain proper
ton Of gold or silver, and take In pay
ment for it the new note issues. The
banks don't want to part with their