Secretary of the Treasury Windom gaid in his treasury report for 1890: "Iu niy judgmcnt the gravcst defect in our present fiuancial systeni is its lack of elasticity. The dernand for rnoney, in this country, is so irregular that an amount of circulation which will be ampie during ten niontbs of the year will frequently prove so deficiënt duriug the other two montlisasto cause stringency and commercial disaster. The crops of the country have reached proportious so immense that their niovenient to market, in August and September, annually causes a dangerous absoi-ption of money. The lack of a snfficient supply to meet the increased demands during those months may entail heavy losses upon the agricultural as well as upon other business interest. " How hard and inelastic is our present unscientiflc currency systein, or lack of eystem, is apparent vhen a comparison is made with the currencjr systems of other countries. In a paiaphlet recently issued by the sound currency committee of the Reform club Mr. L. Carroll Root illustrates the relative elasticity of 20 different banking systems in 10 different countries. He says: "The data securedincludes weeldy or mouthly statements of the outstanding eirculation of the leading bank currency systems of the world. The period covered in each case is the two years 1894 and 1895. The method of prepara tion of diagrams has been to take the minimum eirculation of the period as a base line and to reduce the amounts on other dates to percentages of this. In this way a common measure has been secured, and comparison of one diagram with another is facilitated. " We reproduce below three of Mr. Root's diagrams which show iu a striking way the great difference in elasticity of currencies in Scotland, Cauada and the United States. Circulation. Circulation. 1894. 1895. January 27. . .L6,220,523 January 26. ..L6,347.434 February 24. 6,101,264 Pebruary 23.. 6,276,997 March 24 6,089,075 March 23 6,822,469 April 21 6,289,359 April 20 6,605,203 May 19 6,809,226 May 18 7.135,552 June 16 7,093,971 June 15 7,440,039 July 14 6,687,832 July 13 7,095,838 August 11.... 6,434,985 August 10.... 6,907,196 September 8. 6,425,971 September 7. 7,041,601 Octoberö.... 6,423,398 Octoborö.... 7,054,197 November 3. 6,599,290 November 2. 7,191,632 December 1.. 7,289,749 November30. 7,764,561 December 28. 6,906,079 December 28. 7,326,083 Circul3tion. Cireiüation. 1894. 1895. January SI $30,571,375 $28,917,270 February 23 30,003,267 28,815,434 ilareh 31 ;,7u2,607 2:1,414,790 April3i) 29,996,472 29,152,152 May 31 2S,4fi7,718 28.429,134 Juno B0 30,254, 150 30 100,578 JulySl 29.801,772 28,738,116 August 31 30,270,306 30 737,022 September 30 33,355,150 32.771,442 October31 84,6 34,071,028 November 30 33,076,868 34,3(J2,71Ö December 31 32,375,020 32,565,179 UNITED STATES NATIONAL BANKS. Circulation. Per cent. December, 1SS3 $204,581,130 102.8 Pebruary, 18U4 201,882,832 101.5 May, 1S!I4 200,514,419 100.7 July, 1894 1!)8,984,534 100.0 October, 1894 200,370,704 100.6 December, 1894 200,391,327 100.7 Marcb, 1895 199,436,622 100.a May, 1895 204,028,800 102.5 July, 1895 205,480,399 103.2 September, 1895 208,060,813 104.5 December, 1895 200,766,713 105.4 Pebruary, 1896 211,889,750 106.4 These diagrams show that in Scotland there is about 20 per cent more of currency in circulation in November than in February. In Canada there is 22 per cent more currency in circulation in October than in May. In the United States there was only 6 per cent change in circulation during the two years 1 894 and 1895, aad the most of this change is accounted for not by the changing needs for currency at different periods of the I year, but by the sales of United States bonds, which made it convenient for banks to increase their circulatiou. Mr. Boot thus explains the changes in Canada and Scotland: "For instance, on comparing the circulation of Canada and Scotland, the iirst thing noticed is that in Scotland there are two upward movements, one culminating in May and the other in November, while in Canada the former other occurs oue month earlicr than in Soctlaiid. The explanation will without doubt be found in the Scotch practice of making payruciits ou rnortgages, interese, anuuitïes, etc, at those dates - a practico uot followed so extensively in Canada. "ín general a single annual movement may bo said to characterize agricultural communities. This ocours in the fall, and is due to what we have come to cali 'moving the crops.' lts explanation may be found in the fact that farmers, as a class, are not accustorued to make use of bank deposits, and conseqnently when payments are made to them for their crops (largely at a single season of the year) the surplus over immediate payments is required by them in the form of notes - it being unquestionably true that in any of our agricultural coinmunities in this country the average farmer has in his possession during the six weeks following the sale of his erop a much larger amount of currency than during the rest of the year. The result in the aggregate is an extraordinary demand, suoh as that which leads in Canada to an animal expansión of 20 per cent in the bank circulation. " Undoubtedly the oeeds for currency in the United States cliange about as much as in Canada, but the cost of buying boncis at a high premium on which notes can be issued only to 00 per cent of their par value, the red tape necessary to obtain these notes from the government and the tax on circulation make a delay and cost in increasing the circulatiou which practically prohibit an increase until the need for such increase is past. Therefore interest rates in this country run up rapidly in August and September without appreciably affecting the supply of currency. In Scotland and Canada the machinery necessary to increase the supply of currency is simple and is entirely in the hands of the banks; henee the cost and delay necessary are much less than with us. ïhus in Canada a few big banks with numerous "brauch banks" snpply all parts of the country with currency. When more money is needed in any province - as in Mauitoba when the wheat erop is being harvested - rates of interest begin to rise. The profits of supplying currency in this province are increased,and immediately additional supplies of currency are sent from the big banks in Montreal, Quebec or Toronto to their branch banks in Manitoba. Thus the cost of moving the crops is much lower in Canada than in the United States, where rates of interest go up and down without materially changing the supply of currency. Of courso the farmers, through increased competition of bidders, who obtain plenty of money at low rates of interest and can afford to pay high prices, reap most of the benefit. There are other advantages connected with "branch banks" which it is unnecessary to explain here. It is sufficient to say that in Canada there is no silver question to disturb business and occupy the time of politicians and legislators. It is not likely that we will have financial peace until we greatly improve our banking and currency systems.