Memorandum for Mr. Porter and Mr. Strong
Title
Memorandum for Mr. Porter and Mr. Strong
Creator
McAdoo, W. G. (William Gibbs), 1863-1941
Identifier
WWP18425
Date
1913 December 11
Description
A memorandum on greenbacks and the gold reserve.
Source
Benjamin Strong Jr. Papers, New York Federal Reserve Bank
Language
English
Text
Monetary
Memorandum for Mr. Porter and Mr. Strong
At the Metropolitan Club after Mr. Vanderlip’s speech I promised to look up and send a memorandum in support of contention on the greenback situation.I find that the $346,681,016. outstanding greenbacks secured by gold reserve fund of $150,000,000. are redeemable in gold unpon presentation, but the Secretary is required
1- To restore the gold coin to the reserve fund immediately out of the gold coin in the general funds of the Treasurey, if any, and place the greenbacks in the general fund, thus restoring the gold reserve to 150,000,000., or
2- He may exchange the greenbacks for gold coin presented by the public at the Treasury, or
3. If necessary, he may go out and purchase gold coin "at such rates and upon such terms as he may deem most advantageous to the public interest," but he must pay therefor in the greenbacks.
4. If he fail to maintain his $150,000,000. reserve fund intact by the foregoing methods and the fund falls below $100,000,000. then it is his duty to restore the fund to $150,000,000. by selling bonds and purchasing gold with the proceeds.
Finally the law of March 14th, 1900, also contains a clause, "that US notes when redeemed in accordance with provisions of this section shall be re-issued but shall be held in reserve until exchanged for gold as herein provided; and the gold coin and bullion in the reserve fund together with the redeemed notes held for use as provided in this section shall at no time exceed the maximum sum of $150,000,000.
Memorandum for Mr. Porter and Mr. Strong
At the Metropolitan Club after Mr. Vanderlip’s speech I promised to look up and send a memorandum in support of contention on the greenback situation.I find that the $346,681,016. outstanding greenbacks secured by gold reserve fund of $150,000,000. are redeemable in gold unpon presentation, but the Secretary is required
1- To restore the gold coin to the reserve fund immediately out of the gold coin in the general funds of the Treasurey, if any, and place the greenbacks in the general fund, thus restoring the gold reserve to 150,000,000., or
2- He may exchange the greenbacks for gold coin presented by the public at the Treasury, or
3. If necessary, he may go out and purchase gold coin "at such rates and upon such terms as he may deem most advantageous to the public interest," but he must pay therefor in the greenbacks.
4. If he fail to maintain his $150,000,000. reserve fund intact by the foregoing methods and the fund falls below $100,000,000. then it is his duty to restore the fund to $150,000,000. by selling bonds and purchasing gold with the proceeds.
Finally the law of March 14th, 1900, also contains a clause, "that US notes when redeemed in accordance with provisions of this section shall be re-issued but shall be held in reserve until exchanged for gold as herein provided; and the gold coin and bullion in the reserve fund together with the redeemed notes held for use as provided in this section shall at no time exceed the maximum sum of $150,000,000.
Original Format
Miscellaneous
To
William H. Porter
Strong, Benjamin, 1872-1928
Files
Collection
Citation
McAdoo, W. G. (William Gibbs), 1863-1941, “Memorandum for Mr. Porter and Mr. Strong,” 1913 December 11, WWP18425, Benjamin Strong Jr. Papers, Woodrow Wilson Presidential Library & Museum, Staunton, Virginia.