The Washington times., 1916-01-29

| injuries, however, DTlnG lToih tnc IS-
serve board positive denial that there
| has been any effort to start a crusade
Of this kind. The reserve bank officers
| took their action and issued their
declaration without consulting the re-
| serve board members: in fact. the board
did not even suspect that the subject
was to be taken up 1t is declared TO be
kmerely a coincidence that both the re-
gional bank managers and the reserve
board are unit in favor Of this pro-
ceedine.
| In the opinion OF banking authorities.
| there has never been a time from their
issuance down to date. when the retire.
| ment of the Greenbacks could have been
| accomplished with so little disturbance
| even to the prejudices of financial
| theorists. as now because the vacuum
| left by them could be filled. II neces-
| sary. by increasing the issue of reserve
! notes The latter are not open to the
| objections so long urged against the
| greenbachs and it Is quite possible. in
| the opinion OF many financiers. that the
| gradual retirement Of the greenbacks
| without substituting anything for them.
| would accomplish a contraction OF the
money stock that. together with tho i'm
| provement of its quality incident to
| eliminating the fiat issue. would be a
| benefit to the country.
Fear of Too Much Money.
! This Is because there is very
genuine fear Of getting too much money
in circulation. Imitation can be accom-
phshcd lust as effectively by having
| too much gold As by too much fiat
| money. The increase in the Country's
| gold stock during 1915 was so great that
] Il trrt,. fE.t
Crcenbacks had been gathered in and
| burned. there would have been prac-
| tiCallN no change at the wears end in
| tn" general situation
During the latter half Of 1914 there
was great movement Of gold from
this country, netting loss. for the
whole year. of 500 O.O00,T0 Then the tide
| turned ana we imported a total of S42U-
| oV,ooc in 1915.
But this does not state The real
| measure OF our increase in gold stock.
Ordinarily. the country exports about
all the domestic production OF gold. The
| business world must draw its gold from
the few countries that produce it: most
OF II from South Africa, North America,
| and Australia. But in 1915 We kept at
home the slOOnnn.Go gold that we pro-
| duced, and that ordinarily would have
! been in greater part sent awa!. Adding
this to tho $500 eD0no drawn from abroad
| makes the enormous total of $500, ,ncO 0U
increment In our stock.
| showing is Impressive.
This means that the United States
i has now Just about two billion dollars
III gold coin and bullion available for
use as coin, or so per capita. We
have gained immensely while every
other country possessed of a very large
gold stock has been losing. TO what
extent the warning countries have lost
gold there Is no worth while intorma-
| SIR
that all of them are msrepresentinE
the facts and making their gold hold
lngs look bigger than the facts war
rant. and even the countries at war
accuse each other of this misrepresenta-
ton.
/ But comparing Americas gold store
OF two billions OF dollars even with the
. holdipEs OF other countries before the
war began draining 1t away from them
the showing OF this country is impress
! sive. Austria-tiunEarv had s356, 900 OO";
Germany. $2"5So,""n; --e United lInE-
dom. S71I 900 010: Franco, 81 20C, 100 ONO;
Russia. s9iS nOO. 600; Italy. S2Ss go coo. The
whole British empire was credited with
only about Sl.2m,Gu,mO, or little more
than half what the United States now
holds, and this included the India. Cana
dian, Australasan, and South African
domnionS.
In this computation the entire world =
seven billions. The United States. then,
would appear to have Nearly 80 per cent
of the gold money stock OF the whole
world.
Financiers Are Afraid.
Financiers are frankly afraid OF this
condition. Some relief was recently ex-
pressed In Washington when exports of
gold to Canada and Argentina were re-
ported. 1t was hoped that this indicated
that Americans were buying securities
in those countries, and that the business
would continue, so as to diminish the
tendency to pile up gold here as a temp
tation to low interest and big specula-
ton.
Compa ring the s346, 900 900 of the green
backs that are theoretically in CirCula-
| ton, il is evident that the grcenba Cks
| are good deal less important clement
in the national circulation than they
were even few years ago. Moreover,
nobody believes there would be nearly
this amount of the greenhaGks to re-
deem and retire. Since they were first
issued in 1862 a good many millions of
them have been lost, burned, or other
wise destroyed. Careful calculations
from all kinds of experience have been
prepared by statistically disposed people
TO approximate the probable losses in
these ways, but the results are only
low as SIS, 900, 900; the highest go up to
$50, 900 900, with the higher figures gen.
orally regarded as more probable than
| the lower.
The Federal Reserve Board would like
to see the country done with the green
backs, but ii has no notion of trying 10
get legislation to accomplish this. There
is still too much fiatist sentiment in the
country. "A measure to provide spc-
officially for retirement of the green.
backs wouldn't have ChaCe, in my
opinion, at this time" declared one
fiscal officer of the Government at
would be senscless to involve the new
banking system in such a quarrel, with
all the prCiudiccs that would be aroused
! The time may not " NJ AWAS