452 



THE CENTURY BOOK OF FACTS. 



Upon a deposit of registered bonds, the as- 

 sociation making the same will receive from 

 the Comptroller of the Currency circulating 

 notes of different denominations, in blank, 

 equal in amount to ninety per cent, of the cur- 

 rent market value, not exceeding par, of the 

 bonds so deposited. 



The national banks pay to the United States 

 a tax of one per cent, annually upon the average 

 amount of their notes in circulation, one half 

 per cent, annually upon the average amount of 

 their deposits, and one half per cent, annually 

 upon the average amount of capital not in- 

 vested in United States bonds. Banks other 

 than national pay taxes to the United States on 

 account of their circulation, deposits, and capi- 

 tal at the same rates as are paid by the na- 

 tional banks. 



Saving's Banks. These are banks for 

 receiving and taking charge of small sums, the 

 savings of industry, and were instituted for 

 the benefit of workmen and others, who were 

 able to spare a little from their earnings. It 

 is believed that Quaker thrift in Philadelphia, 

 Pa. , led to the inception of the idea, and that 

 the first savings bank in the world was founded 

 in that city in 1816. As the scheme grew in 

 popularity throughout the United States, 

 guardians of minor children, administrators 

 of estates of deceased persons, and other hold- 

 ers of trust funds, found the savings banks 

 very serviceable as places of deposit for money 

 that had to be laid away for a specified period of 

 time. Hence, the exigencies of business transac- 

 tions forced an innovation upon the original 

 plan. In the United States this use of savings 

 banks is still maintained ; but during the past 

 fifteen years Safe Deposit and Trust Companies 

 have been numerously established for the special 

 purpose of holding funds, both in trust and in 

 legal dispute, besides securities of all kinds, 

 jewelry, diamonds, and articles of like value. 

 Thus a guardian, an administrator, or a society 

 will invest money in Government, State, or 

 City bonds, or, if permitted by the terms of 

 trust, in real estate, or stock of various corpo- 

 rations, and place the bond, certificate of stock, 

 or other acknowledgment of the indebtedness, 

 with a Safe Deposit or Trust Company, for 

 safe-keeping. The savings banks are allowed 

 by law to invest their money in first-class se- 

 curities only, so as to prevent their officers 

 from using the fund in the irregular pursuit of 

 " wild-cat " speculation. 



The average rate of interest allowed by sav- 

 ings banks in the United States on deposits is 

 four per cent. ; it is frequently below that rate. 

 Some of the larger banks will not permit indi- 

 vidual deposits beyond a special amount atone 

 time, while others decrease the rate of interest 



as the amount of deposits increases, claiming 

 that their vast aggregates of deposits cannot be 

 invested, under the law, in a manner that will 

 warrant the maximum rate of interest after 

 paying current expenses. 



From Philadelphia the original conception 

 or plan of the savings bank extended all over 

 the United States, throughout the United 

 Kingdom, France, and other countries. Sev- 

 eral Acts of Parliament were successively 

 passed between 1817 and 1828 for the regula- 

 lation of savings banks in England ; and in 

 the year last mentioned the whole of these 

 were consolidated in one statute (9 Geo. IV.. 

 chap. 92). This Act, together with another 

 passed in 1833, conferring additional and im- 

 portant privileges on savings banks (3 Will. 

 IV., chap. 14), constitutes the existing law 

 relative to these establishments. In 1835 the 

 Act was extended to Scotland. 



SEIGNIORAGE. 



This term, as used in the United States, 

 means the profit arising from the coinage of 

 bullion. The government does not purchase 

 gold bullion, but coins it on private account. 

 There is no profit from the coinage of gold 

 bullion, the face value of gold coins being the 

 same as their bullion value ; but at the present 

 ratio of 16 to 1,-the face value of the silver 

 dollar is greater than its bullion value ; there- 

 fore, when silver bullion is purchased and 

 coined into dollars there is a profit arising 

 from such coinage, the amount of which de- 

 pends upon the price paid for the bullion. For 

 example, there are 371 1-4 grains of pure sil- 

 ver in a dollar, and there are 480 grains of pure 

 silver in a fine ounce. The coinage value of a 

 fine ounce is therefore $1.2929 . If the fine 

 ounce can be purchased for seventy cents, the 

 profit of its coinage (the seigniorage) is 

 $0.5929 , and the profit on the 371 1-4 

 grains of pure silver in the single dollar is 

 $0.4586 , which is the difference between 

 the actual cost of the bullion in the dollar and 

 the nominal value of the coin. 



MONEY IN THE UNITED STATES. 



