The Hawaiian gazette., 1918-08-16
MORE USE Of PAPER
MONEY IS COMING
Government Requests Consery-
ing Gold To True Purpose Of
Security For Currency b

City and county employees when paid
off yesterday were surprised to have
their checks honored in currency in.
stead of the usual gold and soon after.
ward the fact was, the talk Of the
street. For a week or more past the
banks have been rendering paper mon
ey more and more and gold less and
less. Hawaii is getting in line with the
mainland once more, only, rs was the
case with the draft, Hawaii ID several
months behind. The mainland got on
o currency basis months ago. Recent
arrivals here say that they have not
seen gold in circulation as IL is here for
months past. g. t-
There is no cause for alarm and
the government is not "hparding gold y
in the sense that those words would
usually be employed. 1t is the pur.
pose of the government to have the
gold for the purpose it is intended, the
security back Of the paper money
Never has the country had so much gold
as now. 1t amounts to nearly two billion
dollars, Ito 1890, ,301 ,0O0,) and in q
year has increased by nearly fifty per-
cent.
Others Use Paper
So HonOlulans may as well get used
to paper money. In taking it they are
sacrificing nothing, for the paper is
just as valuable, has just as much pur-
chasing power On the Atlantic sea.
board for many years past very little
gold coin has been handled. So IL has
spread even to the Pacific Coast Ha.
waii had quite q shipment when the
first bonus payments were made by the
plantations and some. Filipinos and
Porto Ricans could not understand the
paper currency at first. Many were
the amusing incidents that followed.
Secretary of Treasury McAdoo issued
the following statement explaining why
the government asked an increased use
Of paper money and decreased use
Of gold:
McAdoo Explains
"The use of gold coin as a circulat'
ing medium leads to rapid abrasion
and consequent loss Of value. There il
real economy in using currency in
all ordinary domestic transactions, let.
ting coined gold be used as security
behind gold certificates and as reserve
for federal reserve notes and other
forms of paper currency or for foreign
exchange settlements in cAses where
nothing else can be used in adjusting
international balances.
"There are some firms and corpora.
tiOns, however, in various sections of
the country which have been aecustom.
ed, in making up their payrolls, to use
machines for counting money. While
there is no objection to the use of
these machines in handling silver coins
the use of gold in them in times like
the present must be discouraged. In
most cases firms and corporations
which have been using gold in these
mac chimes have discontinued the prac.
tise, realizing the Importance of pro
tecting the country's gold supply and
Of discouraging the wasteful use OF
gold for payrolls, especially as in most
cases the recipient of the gold coin
would prefer paper money.
"In some cases, however, paymasters
have seen fit to consult their own con
venience and continue to make demands
upon the banks for gold coin for pay
roll purposes. The banks, realizing tbs
waste incident to the use Of gold fol
such purposes, have objected to meeting
the demands of the paymaster but in
some instances have been threatened
W 4