But under the law of 1878, silver certificates
could not be issued in denominations of less than ten dollars. A
scarcity of small notes resulted, which oppressed retail trade
until, in August, 1886, Congress authorized the issue of silver
certificates in one and two and five dollar bills.
A more difficult problem was presented by the Treasury surplus
which, by old regulations savoring more of barbarism than of
civilized polity, had to be kept idle in the Treasury vaults. The
only apparent means by which the Secretary of the Treasury could
return his surplus funds to the channels of trade was by
redeeming government bonds; but as these were the basis of bank
note issues, the effect of any such action was to produce a sharp
contraction in this class of currency. Between 1882 and 1889,
national bank notes declined in amount from $356,060,348 to
$199,779,011. In the same period, the issue of silver
certificates increased from $63,204,780 to $276,619,715, and the
total amount of currency of all sorts nominally increased from
$1,188,752,363 to $1,405,018,000; but of this, $375,947,715 was
in gold coin which was being hoarded, and national bank notes
were almost equally scarce since they were virtually government
bonds in a liquid form.
As the inefficiency of the monetary system came home to the
people in practical experience, it seemed as if they were being
plagued and inconvenienced in every possible way.
Pages:
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139