refuse and the roof of the chamber. If the water runs down hill or on a level, three or four pounds of water will carry two pounds of dirt consisting of coal dust or slate. If the chamber rises from ten to one hundred feet above the level of the shaft, it takes from three to six pounds of water to carry one pound of dirt. The great saving by this method is that in the end this refuse hardens so solidly that the pillars which are now left to support the surface may be removed while the refuse will take their place. An appreciable per cent. of cost is also saved by not employing men on the banks to care for the refuse as it comes from the breakers. It releases valuable surface and saves litigation arising from pollution of the streams.

It must not be thought that the many efforts to make use of the smaller sizes and culm are because their use has been a source of discouragement to the consumer. They have been burned in large quantities with a great saving in cost of fuel. However, the furnace and the grate should be made to suit the fuel. Small sizes can be burned successfully only with a forced draft. The best results have been obtained by a combination of suction in the stack and a blowing of air in the ash-pit.

One of the recommendations of the Anthracite Waste Commission was to the effect that large factories move to the coal fields where the small sizes of coal could be bought from twenty to eighty cents per ton, and then ship their finished products. They called attention to the fact that only men and boys are employed at the mines, and that there is a large force of unemployed female labor there which could be utilized in factories. While fuel and labor are large items of cost, we must not lose sight of the fact that the raw materials must be carried to the factory and the finished goods to market. Unless the raw materials can be produced at or near the mines, or can be left there for finishing on the way to the factory, it would be better to ship coal one way than to ship goods once as raw material and again as finished product.

The supply of Pennsylvania anthracite is limited. In round figures, it will last about one hundred years. Such a peculiar deposit as this should be scientifically mined and conservatively used. It should be regarded as a national trust. It need not necessarily be operated by the Government, but at least no encouragement should be given to its exportation, and we should be allowed

to import coal if it can be obtained more cheaply from some other source than it is produced at home. As noted in the opening of this paper, there is coal in almost every country in the world. If they need the coal it would be to their benefit if they be compelled to mine it in order to get it. If coal is cheap in a country, its manufactures flourish. As for ourselves, let us use our own coal; let us transfer its latent value to some of the raw products we are exporting and get the most out of our abundance of raw materials.

Since the supply of anthracite is so limited, we must be more and more conservative in its use. This will come about as an economic development, since "Necessity is the mother of invention." We shall find new ways of burning coal so as to utilize a larger amount of the heat stored therein. We shall learn how to mine and prepare the coal even better than we do now. Smaller sizes may be used for domestic purposes than at the present time, but it is not likely that sizes below pea will ever be used very extensively for this kind of consumption. If some method could be discovered by which a greater quantity of small sizes could be consumed with profit, the burden of production would fall less heavily on the domestic sizes and so give us a domestic fuel at a less rapidly rising price. A suggestion as to how this may be accomplished will be presented in a subsequent paper.

New Jersey.

At a recent meeting of the Society of Certified Public Accountants of New Jersey a report of the delegates to the convention of The American Association of Public Accountants in St. Paul, Minn., on October 14, 15 and 16, was made by Vice-President T. Cullen Roberts, of Hoboken.

President Frank G. DuBois, who was also a delegate to the convention, and who is president of the State Board of Public Accountants, reported that there are now forty-eight experts who have received State certificates as certified public accountants in this State since the enactment of the law in 1904. Financial and business institutions now recognize the fact that qualified experts, who are certified under the laws of our State, can be relied upon.

The Society, formerly composed of Fellows only (C. P. A.'s), has decided to admit all associate members. These accountants must be in the regular employ of Certified Public Accountants, and must be recommended by Fellows of the society. This is done to inspire them to become Certified Public Accountants. Two applicants have already been admitted to associate membership.

Schemes for Currency Reform.

BY JOSEPH FRENCH JOHNSON,

Dean of New York University School of Commerce.

The currency panic of October, 1907, from the evil effects of which the country has not yet recovered, has made the subject of currency reform one of first importance. It is almost certain that Congress will endeavor during its present session to improve the present currency system. It is worth while, therefore, to consider the important defects of the system and to review the plans for betterment which are likely to have the strongest support in Congress. That is the purpose of this article.

Agitation for the improvement of our currency has been under way since 1896. That year marked the culmination of a long battle over the monetary standard, the decision being in favor of gold. The question of the standard having been settled, reformers immediately began an agitation for improvement of the currency system based upon the standard. Gold is the real money in this country, yet very few exchanges are mediated by means of gold, most payments being made either with some kind of paper money or with a check. When one speaks of the evils of our currency system, reference is always to the paper money and not to the gold standard nor to the bank check.

As a result of the discussion which began in 1897, there is now a pretty general agreement on the following points:

(1) That the National Bank Note system is unsatisfactory because the circulation is not elastic, the issues of notes being governed by the prices of Government bonds, and not by the needs of business.

(2) That some change should be made in the relation between the National Treasury and the money-market in order that the collection and disbursement of federal revenues may not alternately produce contraction and inflation of the supply of currency.

Most currency reform schemes deal solely with the first point. The need of an elastic element in the currency is now generally recognized by bankers and business men, and human experience has found no means of supplying this element other than the bank note. Government credit money, such as the

greenback and the silver dollar, is incapable of expansion and contraction. Its volume is fixed by Congress and cannot be changed except by act of Congress. A bank note, however, is a piece of bank credit like the bank deposit, and if banks were as free to issue notes as they are to extend their deposit liabilities, the volume of notes in circulation would always expand and contract with the business needs of the community, just as does the volume of checks at the present time.

The elasticity of bank currency has been proven by experience in this and other countries. In Canada, for example, banks expand their note credits with almost as much freedom as they do their deposit credits. If a customer borrows $10,000 of a Canadian bank, the bank can, with equal ease, give him $10,000 in notes or a deposit account for $10,000. Whichever the customer desires the bank grants, and in either case its liabilities are the same. If it gives notes it makes due preparation to redeem the notes as they are presented to the clearing house; if it gives a deposit account, it makes the same preparation to take care of checks. In order to protect innocent holders of notes and to give them general currency throughout the Dominion, the law provides for the maintenance of a 5 per cent. guaranty fund and for the redemption of all notes in at least one city of each Province. The law also limits the issue of notes to the paid-in capital of the bank. This system has been in operation in Canada nearly twenty years, and no bank note has yet gone unredeemed. During these years Canada has never suffered from currency stringency. In the fall, when the need for currency is largest, the total circulation of Canadian banks is some $20,000,000 greater than in the spring. Canada now has thirty-five banks with over 1,000 branches. The minimum capital of a Canadian bank is $500,000. The total capital of Canada's thirty-five banks, not including surplus, is now nearly $100,000,000.

The best illustration of such a system of bank note issue afforded by the United States was the old Suffolk Banking system in operation in New England from 1820 to 1861. Under this system Boston was the redemption center for all note-issuing banks in New England, and on account of the daily redemption in that city the total circulation of New England banks never rose above the amount actually needed by the people, being large in busy seasons and small in dull seasons. Bank notes were not

secured by any deposit of collateral, yet the losses from bank failures in New England under the operation of this system were less than in those States where a deposit of collateral security was required.

It is not necessary for me to make a detailed argument for the bank note based upon the general assets of the bank. This subject has been thoroughly threshed out in recent years, and the argument needs no restatement at the present time. Practically all students of banking are agreed that under proper conditions banks can safely be permitted to issue notes secured only by their general assets. It is also agreed that a circulation thus obtained is more elastic and satisfactory than any other can be. People who deny these two propositions, it is morally certain, have never made a careful study of either banking theory or banking experience.

But when it is proposed to introduce asset currency into the United States, there exist some very reasonable grounds for differences of opinion. In this country there are over six thousand National banks now issuing notes secured by deposit of Government bonds with the Treasurer of the United States. These notes now amount to about $700,000,000. There is also in existence over $300,000,000 of United States notes, nearly $500,000,000 of silver certificates and about $750,000,000 of gold certificates. Can we safely graft upon this complex currency system a bank note circulation based solely upon the assets of banks? A man may thoroughly believe in the superiority of the Canadian and Suffolk banking systems, and yet, without inconsistency, answer that question in the negative. If this were a new country and a banking system were about to be introduced, the Canadian system might safely and wisely be copied, but under existing conditions I fear that any attempt to introduce such a system, or anything similar to it, would be fraught with great peril. In order to make my position clear I call especial attention to the truth of the two following propositions:

First, no bank currency can be elastic unless the limit of possible issue exceeds the maximum demand for currency.

Second, no country can have a really elastic bank currency so long as any "lawful" paper money of the same denominations is in circulation.

I call attention to these two propositions because they are of