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Show Federal Reserve Banker In Salt Lake Is Asked to Do Part in Finance Drive PIE Salt Lake federal reserve bank bag been asked to play its part in the general financing rehabilitation of the nation, according to a communication sent to the local bgnk by Andrew W. Mellon, the new secretary of the reamiry. The treasury chief in hin letter gives a detailed account of the flnsncial condition of the country and urges thst the greatest care and economy In expenditures be exercised. He declares the country's finances are sound, but that the situation calls for the strictest economy, DEBT FALLS DUE. - In addition to current government expenses Secretary Mellon tells the bankers that about 192 000 000 of the national debt will fall due thla month i throuKh treasury certificates. A large part of -this sum Is relied upon from ' the receipts of Income snd excess profits taxes which are now due. To meet- the balance wf the debt and care for current financial obligations the department will Issue certificates to the amount of 1400,000.000. In the first eight months of the fiscal year, ending February 28, there was an excess of receipts over disbursements dis-bursements of tl8t.llfi.505. A total of I2.it26.000.000 has been spent for the war and navy departments, the railroad rail-road guarantees and Interest on the public debt within that period. The secretary predicts that there will be a surplus of receipts over disbursements disburse-ments not only for the first three-quarters three-quarters of the fiscal year but for the tetsl year. t TEXT OF LETTER. Dear Hlr: At the outset of my I ury show that the country'a finances are sound, hut that the situation calls for the utmost economy. The nation cannot afford extravagance, and so far ss possible. It must avoid entering upon new fields of expenditure. The heavy requirements of the government on account ac-count of necessary expenditures, Including In-cluding interest and sinking fund on the public debt, and the maturity of 17,600.000.000 of short -date debt with-I with-I In the next two years or thereabouts 'make It Imperative that the greatest care and economy be exercised In matters mat-ters affecting government expenditures. "The poptr generally must become more Interested In saving th government's govern-ment's money than in spending It. A thorough going nstional budget system must be estsbllshed. and thev government's govern-ment's expenses brog;ht Into' dilation dila-tion to Its Income. "The period which has elapsed since the last qusrterly Instalment of Income . and profits taxes hss been marked by important developments In the market for treasury certificates of indebtedness. indebted-ness. On January 16, 1921, the treasury treas-ury successfully sold an offering of three-months 6Mj per cent certificstes and nine. months h per cent eertlfl-esfe.nn eertlfl-esfe.nn Febrtmry 15, 1SZ1. an offering offer-ing of five-months 84 per cent certificates certifi-cates was likewise promptly oversubscribed. BUYING CERTIFICATES. I "Treasury certificates of Indebtedness Indebted-ness now enjoy a broad and active market, on a straight Investment basis, and all Issues now outstanding are quoted In the open market either at par or at a premium. The last three months have also been marked by still further distribution of treasury certificates certifi-cates among Investors and a reduction In holdings of treasury certificates by bunks. The reporting memlier banks of the federal reserve system fabout 825 banks In leading cities, which are believed to control about 40 per cent of the commercial bank resources of the country and to have subscribed in the first Instance 'for about 76 per cent of the treasury certificates of Indebtedness In-debtedness now outstanding) held on February 26, 1(21, only about $235.000.. 000 of treasury certificates, as compared com-pared with reported holdings on No. vember 2. 120. of about $.113,000,000, snd on February 27, 1920 of about $673,-000.000. $673,-000.000. "On March 4, 1?J h fl.r.l r.. serve-Board reported that there were pledged with the federal reserve banks only about $110,000,000 treasury certificates certifi-cates to secure loana and discounts, or less than 6 per cent of the aggregate aggre-gate amount of loan and tax certificates then outstanding. These figures strikingly strik-ingly show th success of the efforts which hav been made for the last year or more to secure distribution of treasury certificate among ree,l in -yeetors and to keep them out of the banks. administration of the treasury I am addressing this letter to the bsnklng institutions of the country to inform them of the state of the nation's finances, the probable requirements of the treasury for the coming months and Its financial plans for the Immediate Imme-diate future. "About $600,000,000 of treasury certificates cer-tificates of Indebtedness msture on March 16, 121, and about $118,000,000 additional on April 16. 121. On March 16, 121, there will become payable the semiannual Interest on ths Third Liberty Lib-erty losn, amounting to about $78, 000.-000. 000.-000. The treasury must also make large payments under the recent leg. islution authorizing partial payments I on account of the railroad guarantee, which may amount to as much as $200,000,000 during th course of th next month. "In order to meet these heavy requirements, re-quirements, and at the same time pro-vide pro-vide for th current expenses of the government, the treasury -relies In large part upon th quarterly Instalment Instal-ment of Income and profits taxes due Murch la, 121. Advenes paymsnls or March taxes have been up to expectations, expecta-tions, and though It I Impossible to forecast the results with certainty, the treasury has good reason to hop that Income and profits tag payments during dur-ing March will about balance th March It maturities of principal and interest. OFFER CERTIFICATES. To provide for It further requirements, require-ments, the treasury has decided, on th basis of th best available estimates, to offer treasury certificates of Indebtedness Indebt-edness in th amount of $400,000,000, or thereabouts. In two series, both "The two aeries of six months and twelve months certificates now offered are both acceptable in payment of In-com In-com and profits taxes, and should prov peculiarly attractive to taxpayers taxpay-ers as well as to persons having idle funds awaiting Investment. I know that I can count, like my predecessors In office, on your hearty cooperation In th distribution and aale of treasury certificates, and hope that, aa In the past, you will subscribe liberally In ths first Instance for the certificates and use your best efforts to resell them to Investors. "Cordially yours, A. W. MELLON. : "Secretary of th Treasury." dated March 15. 121, one series designated desig-nated T. S. 1-131, bearing 6Ss per cent Interest, maturing September 15, 121. and the other series designated T. af. 122, bearing (1-4 per cent interest and maturing March IS, mil Applications Appli-cations for treasury certificates of thee series will be received In regular regu-lar course through th seversl federal reserve banks, as fiscal agents fo th United States, from which full particulars par-ticulars concerning th offering may be obtained. "Tieasury certificates of therte which mature on March 1, 121, and April 16, 121, will be accepted at par, with an adjustment of accrued Interest Inter-est In payment for any certificates of th twe series now offered which may be subscribed for and allotted. SURPLUS SHOWN. "On th basis of the treasury dally statements, the current operations of the government during the first eight months of the fiscal year through February Feb-ruary 28, 121, ahow a net current surplus sur-plus (excess of ordinary receipts over ordinary disbursementsl'amountlng to $18.116.506.63. Thla showing Is particularly par-ticularly encouraging in view of the fact that during these eight months there hsve been extraordinarily heavy expenditures, but only two quarterly payments of Income and profits taxes "Ordinary receipta up to February 28, 121. have amounted to $3,433.411, 141.3$, as agajnat ordinary -disbursements during dur-ing the same period of $3,247.26.(34.83 (or at the rale of almost $50,000.000 000 a year). Of these disbursements about $750,000 have represented expenditures of the war department, about $450,000.-000 $450,000.-000 expenditures of the navy department, depart-ment, about $475,000,000 payments to the railroads under the transportation act, 120. and about $550,000,000 payments pay-ments of intereet on the public debt a total of about $2,225,000,000 under these four main headings. "In the four months which remain of the fiscal year there will be two further fur-ther quarterly payments of Income and profits taxes, both based on the business busi-ness of the calendar year 120. While it la Imposishle to estimate these tax payments with accuracy, and the prospects pros-pects are that expenditures will continue con-tinue heavy for some time to come, the treasury expects that the operations of the first three-quarters of the year, through March 31, 121, as well aa the completed year's operations, will show some surplus of receipts over expendl- , turee. I "The gross debt of the government on February 28, 1J1. amounted to 124,- I 051.84.?28.28. on the bests of treasury, dally statements, while on the same date the floating debt (loan and tax. certlficatee unmatured amounted to 12 484.032.000. These figures contrast : with a gross debt on December 31. I!0. of 23.fc2.224.168.1. and a floating debt on the seme date of 33.30O.8i8.OOO. As a result of the treasury's operations, on March 15. 1921. these Increases In gross debt and floating debt (which are to be expected in the odd montha when no quarterly .Income and profits tax payments pay-ments are made), should be largely offset off-set and perhaps overcome. RAILROAD PAYMENTS. "The progress to. be mad during th balance of th current yeer In. the retirement of gross debt and floating float-ing debt will depend, of course, upon the extent of the demands made upon the treasury and the volume of Its receipts from taxes and salvage This progress Is likely to be seriously limited lim-ited by reason -of the heavy railroad paymenta to be expected during the next two or three montha "Theee figures as to the public debt and the current operations of the trea- |