UNITED STATES, FINANCES OF THE. 



769 



amount of circulating notes issued by our na- 

 tional banks compared with the amount the 

 law permits them to issue, upon a deposit of 

 bonds for their redemption, indicates that the 

 volume of our circulating medium may be 

 largely increased through this instrumentality. 

 Nothing more important than the present con- 

 dition of our currency and coinage can claim 

 your attention." 



The Comptroller of the Currency, in his an- 

 nual report, renews the proposition made by 

 his predecessor for the establishment of a fund 

 for the security of the note-holders, to be 

 formed (1) from the gain arising from acci- 

 dental loss or destruction of bank-notes, esti- 

 mated now to be not less than $6,000,000 ; (2) 

 from a tax upon circulation, now at the rate 

 of 1 per cent., yielding some $3,000,000 annu- 

 ally ; and (3) from interest at a low rate upon 

 the fund on deposit in the treasury for the 

 purpose of redeeming the notes of banks retir- 

 ing circulation, which now amounts to more 

 than $89,000,000. The Comptroller gives sta- 

 tistics with reference to the 104 banks that 

 have failed, showing what proportion of the 

 note issues could have been redeemed from 

 the assets of those banks, on which the note- 

 holders have a first lien, and adds: "The ex- 

 perience with these 104 banks shows almost 

 conclusively that if their issues to the amount 

 of 65 per cent, of their capital had been se- 

 cured by a deposit of bonds to an equal amount, 

 the remaining 25 per cent, might have been is- 

 sued without other security than a first lien 

 on the general assets, and if a safety fund had 

 been in existence it would in the case cited 

 have been drawn upon to the extent of $62,000 

 only upon a circulation amounting to $5,464,- 

 700. For a beginning, therefore, it might be 

 safe to authorize banks to issue circulation 

 amounting to 90 per cent, of their capital, 70 

 per cent, to be secured by an equal amount of 

 United States bonds at par value, the remain- 

 ing 20 per cent, being issued without other 

 security than a first lien on such assets. But 

 if the law should provide for the accumulation 

 of a safety fund in the manner suggested, then, 

 as such safety fund increased, the percentage 

 of circulation unsecured by bonds might be in- 

 creased, as the diminution of the public debt 

 might require and the safety fund warrant." 



The Coinage. The value of the gold deposited 

 at the mints and assay-offices during the fis- 

 cal year 1885 amounted to $52,894,075.09, of 

 which $31.584,436.64 consisted of domestic 

 b-illion; $325,210.97 of United States coin; 

 $1,869,363.26 of jewelers' bars, old plate, etc.; 

 $11,221,846.45 of foreign bullion; and $7,893,- 

 217.77 of foreign coin. In addition to the 

 above, the value of the gold in the fine and un- 

 parted bars, prepared and redeposited during 

 the year, amounted to $3,854,677.51 ; making 

 the total value of the gold deposited during the 

 year $56,748,752.60. The total amount depos- 

 ited during the previous year, exclusive of re- 

 deposits, was $46,326,678.66. The value of the 

 VOL. XXT. 49 A 



silver deposited for bars and purchased for 

 coinage, was $36,789,774.92, of which $32,- 

 250,044.94 was of domestic production ; $877,- 

 564.58 consisted of United States coin remelted ; 

 $435,692.19 of jewelers' bars, old plate, etc.; 

 $2,104,396.35 of foreign bullion; and $1,122,- 

 076.86 of foreign coin. The coining value of 

 the fine and unparted bars manufactured and 

 redeposited was $1,292,447.95; making the 

 total value of the silver received during the 

 year $38,082,222.87. The total coining value of 

 the gold and silver deposited and purchased, in- 

 cluding redeposits, was $94,830,975.47, against 

 $87,955,153.92 in the previous year. 



The coinage of gold during the year was $24,- 

 861,123.50; of silver, $28,848,959.65 ; and of 

 minor coins, $527,556.80 a total of $54,237,- 

 639.95. The number of pieces and standard 

 value of the coinage executed were as fol- 

 low : 



Of the gold coinage, $20,048,500 were in 

 double eagles ; $2,246,890 in eagles ; $2,545,- 

 900 in half-eagles; $5,670 in $3 gold pieces; 

 $6,982.50 in quarter-eagles, and $7,181 in $1 

 pieces. Of the silver coinage, $28,528,552 con- 

 sisted of standard silver dollars; $2,557.50 of 

 half-dollars ; $2,178.75 of quarter-dollars, and 

 $315,671.40 of dimes. In addition to the coin- 

 age executed, gold bars of the value of $32,- 

 027,463.02, and silver bars of the value of $9,- 

 549,313.37, a total of $41,586,776.39, were 

 manufactured at the mints and assay - offices 

 during the year. The number of silver dollars 

 added to the coinage during the year was $28,- 

 697,767, making the total coinage to Dec. 31, 

 1885, $218,259,761, of which the treasury held 

 $72.538,725 unrepresented by certificates. 



Of the numerous questions discussed by the 

 Secretary of the Treasury in his annual report 

 on the finances, the one bearing upon currency 

 reform is placed first in the order of importance, 

 for the reason, as he states, that it fitly pre- 

 cedes and will facilitate all other reforms, and 

 because it can not safely be deferred. After 

 stating the conditions upon which such a re- 

 form may be undertaken, and contending that 

 the use of gold and silver, with free coinage 

 for each, has not been and can not be main- 

 tained without international agreement, he 

 shows that during eighty years, with free 

 coinage, the people called for only $8.000,000 

 of silver, while in only eight years Congress 

 has required the coinage of $215,000,000. He 

 gives an able review of the legislation of past 

 years on the subject of coinage, tracing the 

 virtual disuse of silver back to the mistaken 

 legislation of 1834, which, as he claims, was 

 enacted contrary to the advice of that eminent 

 and experienced financier, Mr. Gallatin. Con- 



