s as usual, he
began by congratulating Congress on the successful execution of
the resumption act and the funding of all the public debt redeemable,
into bonds bearing a lower rate of interest. He recommended the
suspension of the coinage of the silver dollar, and the retirement
from circulation of United States notes with the capacity of legal
tender. He held that the issue of such notes during the Civil War
was not authorized except as a means of rescuing the country from
imminent peril, and the protracted use of them as money was not
contemplated by the framers of the law. While I did not concur in
all the views stated by the President, especially as to the policy
of retiring United States notes then in circulation, yet his general
conclusions in favor of the coin standard were, in my view, sound
and just. I was very willing to hold on to the progress made in
making United States notes equivalent to coin rather than to attempt
to secure their retirement from circulation.

In the report made by me as Secretary of the Treasury I stated my
opinion that the existing law was ample to enable the department
to maintain resumption upon the volume of United States notes then
outstanding; but added, that in view of the large inflow of gold
into the country, and the high price of public securities, it would
seem to be a favorable time to invest a portion of the sinking fund
in United States notes to be retired and canceled, and in this way
gradually to reduce the maximum of such notes to the sum of
$300,000,000, the amount named in the resumption act.

I would not make such a recommendation now, as I am convinced that
United States notes based on coin in the treasury are the best form
of currency yet devised, and that the volume might be gradually
increased as the volume of business increases. Since resumption
such notes have been maintained at par with coin by holding in the
treasury coin to the amount of thirty per cent. of the notes
outstanding. This coin, lying idle and yielding no interest, costs
the government the interest on an equal amount of bonds, or a
fraction over one per cent. on the sum of United States notes in
circulation. These notes are a part of the debt of the United
States, and if redeemed, must be paid by the issue of $346,000,000
of bonds. I see no reason why the people of the United States
should not have the benefit of this cheap loan rather than the
national banks, and there are many reasons