The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1920-10-14
GOVERNMENT FINANCING.

The United States treasury depart
at low prices $3.50, 600, 900 of lib
erty bonds. The entry of the gov
eminent into the bond market may
have had much to do with the recent
advance in the price of these securi-
ties, but it does not look exactly right
for Uncle Sam to take advantage of
the necessities of his family.
The treasury department has Of
fered in it's own defense the following:
TT would have been unbusinesslike
to pay more than the individual buyer
was paying
Government purchases stabilized the
bond market and prevented liberties
from going lower. as was intended in
the bond purchase provision of the
law passed by congress.
ANY other method of retiring these
bonds would have been impraeticable,
cumbersome and unavoidable. The
government has as much right to go
into the open market as an individual
If a person wants to hold his bond un-
til maturity 1t will be paid in full. If
he is going to sell at a bargain. the
government is privileged to buy"
Senator Harding in his speech of ae-
ceptanee said that be favors action
on the part of the government that
would bring liberty bonds back to par.
The inference was that, If elected, he
would do what he properly could to
bring that about.
Various means have been suggested
by which liberty bonds could be in
creased in market value, the latest pc
ing thru the medir of the postal
savings system. 1t is asserted by those
who have made a study of the question
that raise in the interest rate on
postal savings deposits to 4 per cent
would increase those deposits to such
point that the entire floating debt of
$4,000, 100000 could be paid off in one
year, and that when that was done the
market price of liberty bonds would go
up from to 10 per cent.
1t is a fact that while the govern
ment is paying only about per cent
to the owners of almost 5000, 900, 900
of savings deposits, it is also paying
the banks of the country per cent on
huge flotations of treasury certificates
of indebtedness which represent the
stead of paying the banks so generous
return the government should make
it possible for individuals to receive at
least A per cent for their money.
At present the postal savings system
is patronized almost wholly by the
poor and uniformed people. They
are unfamiliar with the facilities for
loaning their money at higher rates,
and concern themselves chiefly with
the security of their deposits. With
an increase in rates new class of pa
irons. it is urged, would at once take
advantage of the postal system. and
hundreds of millions of dollars would
be deposited that could be applied to
the retirement of treasury certificates
or other obligations OF the government
as they become due.
over $4,000, 100000 in victory notes
must be paid or refunded in 1879, and
it is asserted that by developing the
postal savings facilities enough funds
would be realized to pay off that issue
in full at maturity. OF course with
such prospect in sight the price OF
! the victory notes would promptly show
an upward trend. The same is true OF
liberty bonds, billions of dollars OF
which are redeemable or payable with
in ten years. 1t is doubtful If the
sinking fund will be able to meet ali
of those issues as they fall due. but
with the assistance OF the postal de-
posits the payments might be met.