Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-08-08
URGE ALLIES FUND
DEBTS INTO BONDS
/. TO Be SOLD IN i. s.
Bankers Propose Proceeds
of Such Sale Be Used to
Retire Liberty Loans.
Special Dispatch to The STAR

cPcSiai bisphtcn 10 ne ctAfA
BALTIMORE. Nil. August IA
plan to have Treasury Department
officials effect an arrangement with
debt to this country into bonds of
fixed maturities and apply the PRO-
ceeds from the sale Of these bonds
to the retirement Of a like amount
of liberty bonds, is proposed by j.
w. Hartman Of the Hartman Ma
tional Bank in New York to Waldo
Newcomer OF this city.
The purpose Is to stabilize the
market for liberty bonds and victory
notes, and to enable those who have
stinted themselves in buying these
bonds during the war to use them as
collateral for loans to meet immedi-
ate and pressing needs
The proposed plan sets forth that
financial opinion of weight, right or
wrong, is under the impression that
by the federal reserve banks at the
present time is primarily due to the
CONCESSION of rediscounts of liberty
bond loans carried for member banks.
resulting from the well remembered
urge to buy bonds literally and bor-
row from the banks.
The relief of this condition could be
readily accomplished by conference
with England and France looking to
an agreement whereby the allied debt
of 10000, 100000. owing the United
States, now in the form of promissory
demand notes, could be changed into
obligations of fixed maturity at terms
and rates of interest which the allies
could meet and the new securities
offered to American investors.
The sponsor of the plan declares
that as the foreign securities were
sold the prices could be supplied to
retirement of a like amount of lib
erty bonds. thereby relieving the fed
eral banks and releasing credit for
use in trade.
An equally important result would
be the reduction of the government
debt from approximately $25,O0O,-
100000 to $4,000, 100000, with a cor
respondingly large saving to tho pub
lie in taxes that fall upon us to pay
liberty bond interest.
In commenting on the plan MI.
Newcomer said:
1.-The depressed price Of these Sc
curities and the consequent inability
of our banks and their customers to
free themselves without serious loss
from the weight Of a burden assumed
from patriotic impulses and with the
constant urge. not to say command, to
buy till it hurts and the assurance
'you are lending not your money but
your credit and the reserve banks
will supply the money and carry the
loans and at the end Of the war these
bonds will sell way above par is very
largely responsible for the present
congested condition OF the reserve
banks"
Mr.. Hartman in answer to this
comment said:
Il doubt very much if it will receive
serious consideration at the hands of
those in authority. for the simple rea-
son that there does not seem to be
anybody in authority. nor has there
been any move thus far made toward
solving this particular and serious
difficulty.
It fully realize that all this prop
uganda will bear but little result, but
if we could each do something to-
ward circulating this plan or agitat-
ing some plan. sooner or later the
taxpayer will realize that there is
some way by which his taxes may be
reduced. That is what we are all
fighting for, and, with the tremen-
dous burden upon us all, it reacts in
general business"