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SUB-TREASURIES AND MINTS AND ASSAY OFFICES.

The Treasurer would again call attention to the large sums held by the mints and assay offices. Having no opportunity to examine or canse to be examined these different offices, it is suggested that the coins held in them should be placed in the actual custody of the Treasury, and the duties of the mint officers be confined to the assaying and coinage of the bullion placed in their charge.

The present method of examination of the sub-treasuries is very un. satisfactory, and an appropriation should be made which would enable the Treasurer to put these offices in good condition, and thus render the work of annual examination more thorough, but less costly, hereafter. The Treasurer begs leave to refer to a letter addressed to the chairman of the Committee on Appropriations of the House, under date of April 27, 1886, relative to the needs of the sub-treasury system as it exists at present, in which his views are stated at length. That alterations should be made in the present system, in order that it may conform to the financial changes which have taken place since this system was adopted, does not admit of doubt. The annual and daily transactions of the Treasury have become so large, its financial operations and movements touch the interests of the people at so many points, that great care should be taken to avoid any unnecessary friction. As the country increases in wealth and population, with the consequent increase of its revenues and disbursements, it will be found impossible to continue the system in its present form. With the extinction of the 3 per cent. bonds, which, without some depression or event that cannot now be foreseen, must take place during the ensuing fiscal year, the only bonds availablé for the purposes of the sinking fund will be the 44 and 4 per cent. bonds. These are now selling at a price which averages very little more than 2 per cent. per annum to the purchaser upon the cost, and it may fairly be assumed that this rate of 2 per cent. is the maximum rate to be earned during the life of these bonds. At the present cost of the collection of the revenue of the country, say $3.70 per $100, the loss on the existing sink ing fund, say $45,000,000 per annum, will be $765,000 annually, assuming 2 per cent. as the best rate which the bonds can earn.

Without discussing the consequent possible derangement of our existing financial system if the purchases for the sinking fund are to be maintained at their present figures, it will be found to be impracticable to make these purchases at such times and in such manner as to relieve the money market in times of financial distress. As these derangements happen almost invariably at the time of the moving of the crops of the country, this statement is equivalent to saying that every productive interest in the country must pay toll to foreign buyers, through the lower range of prices which obtain at such times, because of the fact that our arrangements for collecting and disbursing our revenues are so defective as to need an artificial and violent remedy in order to place in active circulation the moneys withdrawn from the business of the country. This method of dealing with the public moneys is not true of any country but this, and the practical sense of the American people, as shown through its representatives in Congress, should be adequate to find a remedy for this constantly recurring evil-one sure to grow and become more burdensome in our future national history. This remedy should be found and adopted with the coming session of Congress, becanse the evil complained of will be upon us before its next meeting, and the Treasury left without any means of supplying the urgent needs of the country.

STATEMENT showing the ASSETS and LIABILITIES of UNIT STATES MINTS and ASSAY OFFICES June 30, 1886.

ASSETS.

MINTS AND ASSAY OFFICES.

and of this office, shows the assets and liabilities of the several mints The following table, compiled from the records of the Mint Bureau

and assay-offices on June 30, 1886:

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Total. 2, 281, 925, 645 42, 454, 430 23 3, 765, 936. 27 3, 468, 020 67,38, 798, 949 75 51, 206, 946 92 4, 003 51 46, 124 22 164, 010 15 485, 119 02 136, 628, 204 47

1$108,623 85

$44,000 38

111, 355 35

14,444 44 $11, 611 03
16,941 48

37, 910 12

*32, 000 00 *27, 950 03

32, 000 00

27, 950 03

$57, 622, 520 84

*$113, 557 96 25, 158, 579 57

5, 012, 353 86

48, 437, 764 18 152, 619 53

18, 383 79 16,767 20

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Total
Deficiencies in bullion fund incurred prior to organization of Mint Bureau.
Included in bullion balance of New York assay-office.
Included in bullion balance of Philadelphia Mint.

135, 770, 705 79

19, 513 60

553, 201 44

234, 655 91

a Old account.

$70 00 $57, 622, 520 84
25, 158, 579 57
5,012,353 86

48, 437, 764 18

152, 619 53

111, 355 35

37, 910 12

18,383 79
16,767 20
32, 000 00

27, 950 03

57 73

50,000 00

70 00 136, 628, 204 47

The deficiency in the cash of N. H. Camp's account when suspended May
15, 1885, of which $11,857.37 belonged to the bullion fund and $666.30
consisted of profits, has since been reduced by $912.64.

DEFICITS, UNAVAILABLE FUNDS.

The unavailable funds were decreased by the following items: A reduction of the amount of the deficit at the office of the assistant treasurer of the United States in New Orleans, La., of $3,700.05, a reduction of the amount of deficit in the United States assay office at Boisé City, Idaho, of $246.34; making a total decrease of $3,946.39.

UNAVAILABLE FUNDS of the GENERAL TREASURY and of the POST-OFFICE DEPARTMENT.

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The Treasurer renews his recommendation of the report of 1885, that steps be taken to so change the method of keeping the accounts of the Treasury Department that its actual condition may be shown when called upon, and the character of the assets and liabilities be accurately stated.

THE SINKING FUND AND PUBLIC DEBT.

Referring to Tables Nos. 46 and 47, in the Appendix to this report, it is suggested that a revision of the method heretofore adopted in making up the sinking fund be made, and that the annual payments on account of this fund conform therewith. It will be seen that by the present method the "entire debt" of the United States will be retired by the year 1908. If the method suggested in the report, page 105, be adopted this debt will be extinguished by the year 1913. Any reduction of the public debt in excess of the annual requirements of the sinking fund will, of course, hasten the period of its total extinction.

STATEMENT showing the FORMER and the PROPOSED MANNER of ESTIMAT-
ING the SINKING-FUND CHARGE for the fiscal year 1887.

According to former method the estimate is made as follows:
1st. 1 per cent. of the principal of the debt, including coin and

currency certificates outstanding and in the cash of the
Treasury on June 30, 1886, and excluding bonds issued to
Pacific Railroad Companies

2d. Interest accruing for one year on previous years' retirement
of debt, as follows:

*6 per cent. bonds.

* Matured certificates of indebtedness (4 per cent.) -
Compound-interest notes and small items (6 per cent.).
United States legal-tender notes, non-interest bearing.
Fractional currency, non-interest bearing

Old demand notes, non-interest bearing..

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Total principal of debt in sinking fund

Aggregate of 1 per cent. of debt and one year's interest on

securities retired prior to July 1, 1886

3d. One year's interest at 3 per cent. on this amount..

Total sinking-fund charge.....

The proposed manner is as follows:

1st. 1 per cent. of the principal of the debt, excluding coin and currency certificates outstanding and in cash of the Treas ury, and amount reserved for the redemption of legal-tender

notes

2d. Interest for one year on the debt in the sinking fund, at the rates which the bonds would now bear if they had been refunded; and at the present rate (3 per cent.) on debt bearing no interest, as follows:

4 per cent, upon the items above marked *

3 per cent. upon all other items..

Making a total of.....

3d. One year's interest at 3 per cent. on $36,345,076.11.

Total sinking fund requirement.

A reduction of...

$264, 805, 100 00
678, 000 00
5,660 00
29,090, 564 00
26, 178, 715 96
505 00

320, 758, 544 96

$17, 750, 630 14

19, 245, 512 70 1,950 00 142 35

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UNITED STATES NOTES.

The following table shows the amount of each denomination of United States notes outstanding at the close of the last four fiscal years and on November 30, 1886:

Denomination.

One dollar........

Two dollars

Five dollars.

Ten dollars..
Twenty dollars..
Fifty dollars

One hundred dollars...
Five hundred dollars..
One thousand dollars..
Five thousand dollars.
Ten thousand dollars..

Total.......

Less unknown denominations destroyed in sub-treasury in Chicago fire

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347, 681, 016 00 347, 681, 016 00 347, 681, 016 00 347, 681, 016 00 347, 681, 016 00

1, 000, 000 00 1, 000, 000 00 1, 000, 000 00 Outstanding..... 346, 681, 016 00 346, 681, 016 00 346, 681, 016 00

1, 000, 000 00 1, 000, 000 00 346, 681, 016 00 346, 681, 016 00

The present business season, which began much earlier than usual, has absorbed a large amount of currency, and this increased movement has not yet ceased. There has been shipped from the Treasury at Washington and other points, since July 1, 1886, the following amounts and kinds of small currency:

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Payments during same period, $21,328,558. Increase of outstanding... Fractional silver coin:

Payments during same period, $1,177,929. Increase of outstanding......

Total of all kinds

4,744, 606 00
6,555, 850 00

2,239, 640 00

$23, 346, 205 00 152,090 00

13, 540, 096 00

9, 291, 728 00

3,096, 614 00

49,426,733 00

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