ation is needed to insure the
continued parity under all conditions between our two forms of metallic
money, silver and gold.

Our surplus revenues have permitted the Secretary of the Treasury
since the close of the fiscal year to call in the funded loan of 1891
continued at 2 per cent, in the sum of $25,364,500. To and including
November 30, $23,458,100 of these bonds have been paid. This sum,
together with the amount which may accrue from further redemptions under
the call, will be applied to the sinking fund.

The law of March 14, 1900, provided for refunding into 2 per cent
thirty-year bonds, payable, principal and interest, in gold coin of the
present standard value, that portion of the public debt represented by
the 3 per cent bonds of 1908, the 4 percents of 1907, and the 5 percents
of 1904, of which there was outstanding at the date of said law
$839,149,930. The holders of the old bonds presented them for exchange
between March 14 and November 30 to the amount of $364,943,750. The net
saving to the Government on these transactions aggregates $9,106,166.

Another effect of the operation, as stated by the Secretary, is to
reduce the charge upon the Treasury for the payment of interest from the
dates of refunding to February 1, 1904, by the sum of more than seven
million dollars annually. From February 1, 1904, to July 1, 1907, the
annual interest charge will be reduced by the sum of more than five
millions, and for the thirteen months ending August 1, 1908, by about
one million. The full details of the refunding are given in the annual
report of the Secretary of the Treasury.

The beneficial effect of the financial act of 1900, so far as it
relates to a modification of the national banking act, is already
apparent. The provision for the incorporation of national banks with a
capital of not less than $25,000 in places not exceeding three thousand
inhabitants has resulted in the extension of banking facilities to many
small communities hitherto unable to provide themselves with banking
institutions under the national system. There were organized from the
enactment of the law up to and including November 30, 369 national
banks, of which 266 were with capital less than $50,000, and 103 with
capital of $50,000 or more.

It is worthy of mention that the greater number of banks being organized
under the new law are in sections where the need of banking facilities
has been most pronounced. Iowa stands first, with 30