RESUMPTION OF SPECIE PAYMENTS. 



period for the redemption of the notes in coin. 

 Some doubt arose thereafter as to whether the 

 notes which had been retired and canceled un- 

 der the act of April 12, I860, could be reissued 

 up to the limit in the aggregate of four hun- 

 dred millions. Secretary Boutwell, believing 

 that such authority existed, reissued of them in 

 1872 $4,687,256, but afterward retired $3,481,- 

 641. In the autumn of 1873, however, owing 

 to the monetary panic, there was much distress 

 in business and a great demand for money. To 

 relievo the stringency of the money market, and 

 to prevent if possible any further commercial 

 disasters, Secretary Richardson reissued of the 

 notes retired $24,844,255, making the amount 

 outstanding $382,979,815, of which he subse- 

 quently retired $979,815, leaving outstanding 

 $382,000,000; and Congress, by an act ap- 

 proved June 20, 1874, established that amount 

 as the maximum limit to which the notes could 

 be issued. 



No further change was made in the amount 

 of outstanding notes, nor any further legisla- 

 tion had in regard to them, until January 14, 

 1875, on which date was approved the follow- 

 ing act: 



AN ACT TO PROVIDE FOB THE RESUMPTION OF SPECIE 

 PAYMENTS. 



Be it enacted by the Senate and House of Kepresenta- 

 tivts of the United States of America in Congress as- 

 sembled, That the Secretary of the Treasury is hereby 

 authorized and required, as rapidly as practicable, to 

 cause to be coined, at the mints of the United States, 

 silver coins of the denominations of ten, twenty-five, 

 and fifty cents, of standard value, and to issue them 

 in redemption of an equal number and amount of frac- 

 tional currency of similar denominations, or, at his dis- 

 cretion, he may issue such silver coins through the 

 mints, the sub-treasuries, public depositaries, and post- 

 offices of the United States ; and, upon such issue, lie 

 is hereby authorized and required to redeem an equal 

 amount of such fractional currency, until the whole 

 amount of such fractional currency outstanding shall 

 be redeemed. 



SEC. 2. That so much of section three thousand five 

 hundred and twenty-four of the Revised Statutes of 

 the United States as provides for a charge of one fifth 

 of one per centum for converting standard gold bullion 

 into coin is hereby repealed ; and hereafter no charge 

 ball be made for "that service. 



SEC. 8. That section five thousand one hundred and 

 seventy-seven of the Revised Statutes, limiting the ag- 

 gregate amount of circulating notes of national hank- 

 ing associations, be, and is hereby, repealed ; and each 

 existing banking association mav increase its circulat- 

 ing notes in accordance with existing law without re- 

 spect to said aggregate limit ; and new banking asso- 

 ciations may be organized in accordance with existiM",' 

 law without respect to said aggregate limit ; and tlio 

 provisions of law for the withdrawal and redistribution 

 of national-bank currency among the several States 

 and Territories are hereby repealed. And whenever, 

 and so often, as circulating notes shall be issued to any 

 such banking association, so increasing its capital or 

 circulating notes, or so newly organized as aforesaid, 

 it shall be the dutv of the Secretary of the Treasury 

 to redeem the legal- tender United States notes in ex- 

 cess only of three hundred millions of dollars, to the 

 amount of eighty per centum of the sum of national- 

 bank notes so issued to any such banking association 

 as aforesaid, and to continue such redemption as such 

 circulating notes are issued until there shall be out- 

 standing the sum of three hundred million dollars of 

 such legal-tender United States notes, and no more. 



And on and after the first day of January, anno Domi- 

 ni eighteen hundred and seventy-nine, the Secretary 

 of the Treasury shall redeem in coin the United States 

 legul-tender notes then outstanding, on their presenta- 

 tion for redemption at the office of the Assistant Trea- 

 surer of the United States in the city of New York, in 

 sums of not less than fifty dollars. And to enable the 

 Secretary of the Treajsury to prepare and provide for 

 the redemption in this act authorized or required, ho 

 is authorized to use any surplus revenues from time to 

 time in the Treasury not otherwise appropriated, and 

 to issue, sell, and dispose of, at not less than par in 

 coin, either of the descriptions of bonds of the United 

 States described in the act of Congress approved July 

 fourteenth, eighteen hundred and seventy, entitled 

 " An act to authorize the refunding of the national 

 debt," with like qualities, privileges, and exemptions, 

 to the extent necessary to carry this act into full effect, 

 and to use the proceeos thereof for the purposes afore- 

 said. And all provisions of law inconsistent with the 

 provisions of this act are hereby repealed. 



It will be seen that the above act provided 

 first, for the manufacture and issue of sub- 

 sidiary silver coins in redemption of the out- 

 standing fractional paper notes; second, for an 

 unlimited issue of national-bank notes, with a 

 provision for the retirement of legal-tender 

 notes to the extent of 80 per cent, of such is- 

 sue, until the amount of legal -tender notes 

 outstanding should be reduced to three hun- 

 dred millions ; and, third, for the redemption 

 in coin of the legal-tender notes, on presenta- 

 tion in sums of fifty dollars and upward at the 

 Sub-Treasury in New York on and after Janu- 

 ary 1, 1879. To carry out the purposes of this 

 act, ample authority was given the Secretary of 

 the Treasury to apply all surplus revenues of 

 the Government, and also to issue at par in 

 coin an unlimited amount of bonds of the de- 

 scription authorized by the refunding act. 



At the time of the passage of this act there 

 were in the Treasury about two million ounces 

 of fine silver bullion. The fractional notes had 

 been gradually approaching par in coin, while 

 the gold price of silver had been gradually fall- 

 ing, and no doubt was entertained as to the 

 possibility of putting and keeping the silver in 

 circulation unless its relative value increased. 

 In this connection the following quotation from 

 the report of the Superintendent of the Mint 

 for 1875 is of interest : 



The depreciation of United States legal-tender notes, 

 which commenced soon after their issue took place, 

 caused the silver coins to be exported, and rendered 

 the employment of a substitute necessary. The issue of 

 fractional notes was undoubtedly preferable to the de- 

 basement of the silver coins, but their permanent use 

 is neither dcshablc nor practicable. The annual issue, 

 boincr about $36,000,000 on a circulation of from $40,- 

 000,000 to $45,000,000, shows the average life of these 

 notes to be, say, fifteen months. The estimates of the 

 Treasury officers having charge of the business show 

 the necessary expense of maintaining this currency, 

 during the last fiscal year, to have oeen $1,410J46. 

 This does not include the expense attending the han- 

 dling of the fractional notes at the different sub-trea- 

 suries and depositaries, all of which receive them for 

 redemption, and which, if added to the expenses in- 

 curred at the Department, would probably show the 

 total cost of maintaining the fractional currency to bo 

 equal to about 5 per cent, on the annual issue, and 

 corresponding with the interest on the amount of bonds 

 which may have to be sold to procure, say, $36,000,- 



