Rensselaer Republican, Volume 12, Number 12, Rensselaer, Jasper County, 4 December 1879 — Annual Report of He Comptroller of the Curreney. [ARTICLE]

Annual Report of He Comptroller of the Curreney.

Washington, November ft * The Comptroller of the Currency haa just completed the seventeenth annual report of the operations of that Bureau, which will be submitted to Congress at the opening of the winter session. The following extracts are taken from the report: The total number of National banks organized from the establishment of the Na-tional-banking system, February 25, 1869, to November lof the present year Is 2,438. Of these 307 have gone Into voluntary liquidation by the vote of shareholder* owning two-thirds of their respective capitals, and Strhty-oae have been placed in the hands of Receivers for the purpose of closing up their affair*, leaving 2,060 in operation at the date last named. Since my last annual report thirty-eight banks have been organized, with an aggregate authorized capital of $3,5:*5. 000, to which SB,390,440 in circulating notes have been issued. Thirty-eight banks, with an aggregate capital of $4,450,000, have voluntarily dwoontinued business within the same period, and eight banks have failed, having a total capital of $1,030,100. The insolvent banks include two, with a capital of $700,000, which failed after having previously gone into voluntary liquidation.

The aggregate capital of the various classes of bank* ha* diminished from $719,400,000 in 1876, to $656,500,000 in 1879, and the aggregate deposits have fallen off from $2,075,3U).000 in 1876, to $1,893,500,000 in 1879—a redaction of $62,900 030 in capital and $181,800,000 In deposits during the last four years. The Nationalbanking capital has diminished $45,100,000, but the deposits of the National banks are almost Sreciselv tho same that they were in 1876. avings banks with capital show a reduction of about one million in capital and the same amounts in deposits. The capital and deposits of State banks and private bankers are less by seventeen millions and eighty-three millions, respectively. The greatest reduction, however, is in the deposits of savings banks without capital, which have diminished $97,500,000. The great war debt of the United States was contracted in less than four and half years. In 1836 the country was entirely out of debt, and on January 1,1861, the whole debt of the Union amounted to but $66,213,721. During the next six months it increased at tho rate of about four millions a month, being, on the first day of July, 1861, $90,580,813. During the next year it increased at the rate of more than thirty-six millions per month, and at the close of the fiscal year ending July 1, 1862, it had reached $524,176,412. At the end of the succeeding year it wns considerably more than twice that amount, being on July 1, 1863, $1,119,772,138. During the following year it increased nearly seven hundred millions, reaching on July 1, 1861, the sum of $1,815,784,370. During the next nine months, to the close of the war, April 1, 1866, the debt increased at the rate of about two millions a day, or about sixty millions a month, and for the five months next thereafter, ut the rate of about three millions per day, or about ninety millions a month, reaching its maximum on AugUßt 31, 1865, at which date it amounted to $2,845,907,826. The sales of United Stutcs bonds since 1871, under the Refunding acts, have been five hundred millions of ss, one hundred and eightyfive millions of 4(4s and $710,345,950 of 4 per cents; in all, more than one thousand three hundred and ninety-five millions of dollars. There have also been sold for resumption purposes, since March 1, 1875, under the authority of the Resumption act of January 14, 1875, twenty-five millions of 4s and sixty-five millions of 4*4 percents; the latter being at a premium of 114 per cent. The reduction on the interest-bearing debt Of the United States, from its highest point, on August 31, 1865, to November 1, 1879, is $583,886,594, of which amount $105,160,900 was accomplished since the refunding operations were commenced on May 1,1871. At the highest point the annual interest on the debt was $150,977,697, while it is now $83,773,778 only. There hns, therefore, been a total reduction In this charge of $67,203,919. The total annual reduction of Interest under these refunding operations sjnee March, 1877, has been $14,297,1*7, while the saving on this account, growing out of the operations of tho present year alone, is nearly nine millions ($8,803,707), and the total nnnunl saving in all tha refunding nperaQons of the Government since 1871 is nearly twenty millions <sT(,:or,ftc7). The refunding of the National debt commenced in 1871, at which time the National banks held nearly foil : hundred millions of tne five and six per cent, bonds, und from that date to the present time they huve held mote than one-fifth of the interest-bearing debt of the United States. A large portion of the bonds held by them in 1871 lx ire Interest at the rate of six per cent. This elasS of' bonds huf since been greatly reduced, and is now less than one-sixth of all the bonds pledged for circulation, while more than oms-third of Iho whole amount consists of bonds'bearing interest at four per cent. The Government has still outstanding $273,681,:'30 in six percents, und more t hun s7o'),00U.OU) in five per cents, all of which-will mature in 1881. The refunding of these Ixmds into four per cents will stive $ 10,413,001 in interest annually. The credit of the Government is now such that it is not improbable that long before its maturity the present debt Biay be refunded into three and a half per cent, bonds, which is one-half per cent, more than the rate of the English consuls, thus saving to the Government a large additional amount of interest.

The act of Jan. 14, 1875, required the Secretary of the Treasury to redeem “in coin the United States legal-tender notes then outstanding, on their presentation for redemption at the office of the Assistant Treasurer of the United States in the City of New York, In sums of not less than fifty dollars,” on and after Jan. 1, 1879. At the time of the passage of this act the leading industries and general business of the country were very much depressed. The agricultural classes were largely in debt, and the failures of mercantile establishments and manutacturing corporations In the three years previous represented more than $500,000,009. During the succeeding years an era of economy supervened, agricultural products greatly increased, and the balance of trade whs turned largely in our favor, the excess of exports over Imports for the fiscal year 1876 being more than sev-enty-nine millions, in 1877 more than one hundred and fifty-one millions, in 1878 exceeding two hundred and fifty-seven millions, and for the year ending September 30 last more than two hundred and ninety-four millions. For 1878 the excess was, it will be seen, more than three times as great as that of 1876, and more than two-thirds greater than that of 1877. The Resumption act not only fixed the day of resumption, but authorize*! the Secretary, in order to prepare and provide therefor, to use any surplus revenues not otherwise appropriated, and to Issue, sell and dispose of, at not less than par In coin, any of the bonds of the United States described in the act of July 14, 1870. Under this act, the Secretary In 1877 sold at par in coin $16,000,1000f/our and a haifs and $23,000,000 of fours, and in April, 1879* <50,000,010 of four and a half per cents at a premium of one and a half per cent. The coin in the Treasury continually Increased, so that on the day of resumption the Secretary held one hundred and thirty-five millions ($135,382,639) of gold coin and bullion, and, in addition, ovei thirty millions ($30,567,533) in silver coin, the gold coin alone being equal to more than forty uer cent, of the United States notes then outstanding. The banks of the country nt the date of resumption held more than one-third of the outstanding Treasury notes; but they had sc much confidence in the ability of the Secretary to maintain resumption that none were presented by them for redemption. The people nlso, who held more than three hundred millions of the Issues of tho National banks, whieh issues were based upon the bonds of the Nation, preferred such notes to coin itself. There was, therefore, no demand for payment of the notes of the Government, and the gold coin in the Treasury, which amounted to one hundred and thirty-five millions on the day of resumption, increased more , than thirty-six millions in the next ten months, the amount held on the first of November, 1879, exceeding one hundred and seventy-one millions. During the last fifteen years gold coin has been used by the banks in comparatively small amounts ns a reserve, and by the people only in the payment of customs duties and In the purchase of foreign exchange. If it was used for other home purposes, it was first converted into paper money; but since the day of resumption the Treasury note and the Na-tional-bank note have been generally prefer red In business transactions to coin itself.

The amount of coin and currency in actual circulation at the present time is believed to be not greatly in excess of she average amount during the live preceding years. Tt Is manifest that at no time since the dot* Of suspension so large an amount of currency has been needed for tho legitimate purposes of business as during the present year. The harvests have been unprecedentedly large, while the value of agricultural products, owing to the short crops of other nations and the consequent demand for our products abroad, has greatly increased. There has also been u continual rise in wages, in the value of manufactured goods, in provisions, and in the price of iron and other commodities. If this statement is. correct, It will explain the scarcity of currency in the City of New York during the last two months, and the consequent demand for additional issues, the amount of National-bank notes issued during September and October being nearly six and one-half millions, which is nearly equal to the amount issued for the whole ten months preceding. R will also explain why the banks in New York have grudgingly presented for payment their legal-tender certificates, and been obliged to designate one of their number as a depository for gold, upon which ClearingHouse certificates are issued and used in settling their exchanges. Notwithstanding the large increase of specie in the country during the past year, the amount held by the banks has by no means increased in proportion. The amount held on Oct. 1,1878, was 5c0,688,600; on the Ist day of January. 1879, $41,499,757: and on the 2d of October last, $42,173,732—5h0eing an Increase on that day of less than seven hundred thousand dollars sinoe resumption-day. The more recent returns, however, of the National banks in the City of New York to the ClearingHouse, for the week ending November 15, show a further increase of $21,239,400. The amount of cash reserve now required to be held by all of the banks is less than ninety-four millions. The banks outside of the large cities held on October 2, $11,474,961 of specie, which nearly equals three-fourths of the full amount pf cash reserve which they are required to hold, while the banks in New York and in the other principal cities held in specie considerably lees than one-half of their legal cash reserve. The addition of coin to the circulation should have the effect to reduce the amount of paper money. If In excess of the wants of business, and rend homeward for redemption the legal-tender and the National-bank notes. If the legal-tender notes accumulate in the Treasury, they cannot again be issued, except upon requisitions of the uoverament; and the accumulation of such a tendency to induce extravagant appropriations and expenditures by Congress. The law. as it now stands, requires tbit the

Secretary shall keep to circulation the legaltender notes, which Is not practicable, and their accumulation by him will lead to ooo» ■taut agitation of the subject in Congress and among the people, which discussion* will eooourage speculation, and disturb the current of legitimate business. With the influx of specie it is important that such a paper currency shall be in circulation as can rallj be retired, if in excess. A currency is needed which win act automatically, and aa a regulator, like the governor to machinery; or the balance wheel In the chronometer. The beet currency ia that one which will most readily adapt itself to the needs of business, and Its relative cost should not be taken Into consideration; fur the best money is always the cheapest in the end.