Year: 1877

RETIREMENT OF SMALL NOTES.
A MYSTERY MADE OF Ir-coNTRADICqIoSs-THE


TRUTH FROM Mr.. sHKRNAN-A GOOD DEAL or


QUIET CONTRACTION


lBr TELEGRAPH TO THE TnIBUSE.l


WASHINGTON, June 14.-The Treasury Depart
ment does not appear inclined to take the public
into its confidence in all matters relating to the
processes of resumption. There occasional con-
cealmcnts and diplomatic evasions, well meant, no
doubt but apparently unnecessary in a Govern
ment where everything sooner or later must go
through the ordeal of popular discussion. The case
in point is the withdrawal Of portion of the 81
and So greenbacks from circulation. When it was
first announced in TIE TRIBUNE that the policy of the
Treasury was to withdraw these notes, and that
degree Of scarcity already existed in the money
centers, semi-oflicial announcement was made that
no order had been issued for their withdrawal
Shortly nfterward an authoritative statement was
put out to the effect that there were 51 40i 900 Of
notes Of these denominations in circulation, over
$10,O00.000 more reserved for in the Treasury,
and nearly $1O,OO0,OOO printed nearly printed
in the Bureau of Engraving and Print
ing. Now all this was literally true, but
the way in which it was said gave the
impression that no movement had been set on
foot to contract the volume of the small notes.
While the statements put forth one floor Of
the Treasury, another in the cash-rOOm appeared
this placard in large black letters at the paying
teers desk: 1.-THE issue of one and two dollar bills
is discontinued" At the same time the Printing
Burcau gave information to all vino asked that no
work had been done notes of these denominations
since April.


The whole truth about the matter is learned from
Secretary Sherman and Treasurer Gillian to-day.
1t is that there has been contraction of the 81
and 81 greenback circulation for the purpose pri-
mary of getting the silver coin out faster than
could be done by the slow of redeeming frac
tional currency; and secondarly, as an experiment
in the direction of paving the way to resumption.
No order was issued for the withdrawal of the small
notes, but the Treasurer at Washington ceased to
pay them out some weeks ago. The Treasurer
thinks that the Assistant Treasurers in other cities
are still paying them, but it is reported from
unofficial sources that the strength of private
letters these officials have made their policy comply
with that of the Treasury. Some time in April the
National banks were informed that instead of 81
aud 80 greenbacks for redemption purposes the
Treasury would supply them with silver coin, and
pay the expense of transportation. This expense
was betrayed ont OF what Is known as the silver
profit fund.- derived from the profits on coinage. In
this way large amount of silver was distributed
over the country, and the ordinary supply OF
small bills was cut short. Probably of the
S10,O00.OO0 of 81 aud So notes now in
the Treasury about 81. 100000 may be considered
TO have been withdrawn from circulation, leaving
- 100000 as the ordinary amount kept on hand.
How much more has been withdrawn by the Assist
ant TreasurcIs in the principal cities cannot be
ascertained, bat of whatever it may be. the
amount must be deducted from the $51 100000 re-
ported as in circulation.


The Secretary thinks that whatever scarcity in
these notes may exist had been occasoned chiefly by
brokers boarding them with the belief that there
would be large Withdrawals and that they could sell
all that they could get for premium.


Secretary Sherman further says that. while he
thinks it would b. aid to resumption if the small
notes were oUt oi the way, it is not the policy of
the department to retire them suddenly, and any
further retirement if decided upon, will be exceed
ngy gradual.