13. GOLD EXPORTS - [Yesterday, May 19] The National City Bank has engaged $500,000 gold for shipment to Paris, and Lazard Frères will ship $1,000,000 gold to the same centre, the greater amount being in coin. Hallgarten & Co. have taken $300,000 gold coin for export to Buenos Ayres. In addition to this amount the steamer sailing to-day for Argentina will take $500,000 gold coin shipped by the National City Bank and $200,000 by the National Bank of Commerce. Total gold export engagements since January 1, $50,591,573. The engagement of so much gold coin for Paris was received with considerable surprise in financial circles, as it was not thought heavy exports of the metal in this form could be made at prevailing exchange rates. The bankers making the shipments announced, however, that they were not losing money on the operation. The Bank of France is not allowing interest on the gold in transit, but great care is being exercised in the selection of the coin, double eagles of full weight only being taken. It is not unlikely that further heavy engagements will be made, unless there should be marked change in sterling market quotations. N. Y. Tribune, May 20, 09, 11:3 14. Yesterday [May 19] two engagements for Paris, one of $1,000,000 and the other of $500,000, were divided equally between bars and eagles. Last night demand sterling closed slightly weaker, at 4.8775, on the selling of bills incidental to these shipments, but this decline is not sufficient to check the efflux. As a matter of fact, there has been an unprecedented scramble for gold bars, as these can be exported more profitably than coin. It is pointed out that heretofore the banks have been satisfied to wait until the stock of bars has accumulated sufficiently to warrant a shipment. But now the competition has become so keen that the shippers are taking the result of each day's meltings. The Chase Manhattan Bank secured $300,000 last week [May 17], and put it in its vaults. This week other bankers have put in applications each day to take what is melted in the course of the day. The National City Bank took $250,000 on Tuesday [May 18th], and yesterday put in another application for all that was melted during the day. The superintendent will not reserve meltings beyond the day in which the application is made. Journal of Commerce, May 20, 09, 1:4 15. Further Heavy Gold Exports The $250,000 gold bars engaged by the National City Bank on Tuesday [May 18] was withdrawn from the Assay Office yesterday [May 19], and in addition $2,000,000 in gold coin was withdrawn from the Sub-Treasury by the National City Bank, Lazard Frères, and other shippers. ... New York Times, May 20, 09, 11:3 16. STILL MORE GOLD FOR EXPORT. Engagement of Half a Million at Still more gold was engaged for export to-day, Goldman, Sachs & Co. announcing the engagement of $500,000. There was $750,000 of gold withdrawn from the assay office that had previously been engaged, and taken aboard the steamer Visari, leaving for Argentina [?] to-day. The total amount on that vessel bound for Buenos Aires is $2,000,000. The National City Bank sends $750,000, Goldman, Sachs & Co., $500,000, Hallgarten & Co., $300,000, the Anglo South American Bank $250,000, and National Bank of Commerce, $200,000. The French steamer La Savoie sailed to-day with $1,500,000 gold on board consigned to Paris by the National City Bank and Lazard Frères, half in gold bars and half in gold coin. The total gold exported since January 1 is now $51,500,000. New York Post, May 20, 09, 11:3 17.
New York Herald, May 21, 1909, 17:2 18. [In market activity yesterday] Another advance in sterling exchange led to a further engagement of $500,000 for shipment aboard and in addition to this, $750,000 previously engaged was withdrawn from the Assay Office. The steamer which sailed yesterday for Argentina carried $2,000,000 in specie, while the French steamer took $1,500,000 to Paris. ... N. Y. World, May 21, 09, 11:1 19. GOLD EXPORTS - Gold coin to the amount of $500,000 was engaged yesterday by Goldman, Sachs & Co. for shipment abroad. The National City Bank increased its shipment to Argentina by $250,000. Total gold export engagements since January 1, $51,091,573. The French steamer La Savoie sailed yesterday with $1,500,000 gold on board, consigned to Paris by the National City Bank and Lazard Frères, half in gold bars and half in gold coin. By the steamer Vasari, leaving for Argentina yesterday, $2,000,000 in gold coin was being shipped. The National City Bank sent $750,000, Goldman, Sachs & Co. $500,000, Hallgarten & Co. $300,000, the Anglo-South American Bank $250,000 and the National Bank of Commerce $200,000. New York Tribune, May 21, 09, 11:3 20. EXPORTS - The following is a detailed report of specie exported from the district of New York from May 17 to May 22, inclusive:
Journal of Commerce, May 24, 09, 2:5 As discussed earlier in this report and supported by the above export report, gold coin was routinely and consistently exported to South America while gold bars were exported, whenever possible (rather than gold coin), to Europe. Gold coin was always drawn from the Sub-Treasury, and gold bars were always drawn from the Assay Office. The above series of articles provides some interesting clues and contradictions to the informed reader. We can account for four distinct gold bar engagement purchases, and possibly a fifth, for the May 19th engagement and for purported shipment aboard the La Savoie. New York Assay Office reports (footnoted), which were submitted to the Director of the Mint, Washington, D.C., augment the newspaper accounts. I. Chase National Bank withdrew $300,000 in gold bars for export from the New York Assay Office on May 17th. This purchase formed part of the May 19th engagement which was reportedly shipped May 20th aboard the LA SAVOIE. [Article numbers 2, 3, 4, 5, 6 and 14] 3 II. National City Bank reportedly acquired some gold bars on May 17th, and engaged an additional $250,000 [$230,000?] in gold bars from the New York assay office on May 18th, withdrawing those bars on May 19th. Another application for all bars melted on May 19th was submitted. There were no engagements arranged on May 18th, and, excluding the May 19th engagement, the next two engagements to Europe would occur on June 2, $885,000, and June 25th, $977,000; both of these engagements were drawn from the Assay Office as distinctly separate transactions. National City Bank's May 17th and May 18th gold bar purchases, therefore, was intended for the May 19th engagement. [Article numbers 3, 8, 9, 14, and 15.] 4 III. Lazard Frères, according to Article 8 (see also Article 14), shipped $500,000 in gold bars. But where did they come from? Article 10 states that, on May 19th, Lazard Frères acquired $250,000 in gold bars from the "sub-treasury." The reference to the "sub-treasury" could be a typographical error and might refer to the gold coin that Lazard Frères acquired on the same date. If we assume that a typographical error exists, the hypothesized correction would have Lazard Frères acquiring $250,000 in gold bars from the proper and only outlet for the purchase of gold bars - the New York Assay Office... but, unlike most other Assay Office purchases, this conclusion is without substantiation within the records of the Director of the Mint. A purchase of gold bars from the Sub-Treasury would require a governmental bookkeeping adjustment. Gold bars, regardless of quality (and especially of export quality), were never maintained, handled or sold by the Sub-Treasury; gold bars were always within the control and discretion of the U. S. Assay Offices or Mints. A purchase of gold bars from the Sub-Treasury, however unlikely - unless an adjustment in records was planned - would link above Articles 10 and 11. [Article 10.] IV. $750,000 was withdrawn from the Assay Office on May 20. [Article numbers 16 and 18.] There was always sufficient gold coin that could be exported, if the price were right, and a requirement that a bank pre-commit for gold coin export engagements would not be necessary. The indication in Article 16 that "$750,000 of gold withdrawn from the assay office that had been previously engaged" clearly refers to gold bars and not coin. Although Article 16 indicates a gold bar shipment to Argentina, gold bar shipments were seldom exported to South American countries. The fact that these bars did not go to Argentina is confirmed by both the U. S. Customs export report (Article 20), and Articles 18 and 19. An itemization of gold bar purchases which formed the May 19th engagement, as derived exclusively from newspaper accounts, is as follows:
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FOOTNOTES1 National Archives, Director of the Mint, Letters Received, 280 051. Chase National Bank's May 17th purchase of approximately $300,000 in gold bars from the Assay Office is not a part of the U. S. Government's "Statement..." May 17th, $1,034,000 gold bar engagement. The May 17th - $1,034,000 gold bar engagement was actually purchased from the New York Assay Office by the Farmers Loan and Trust Co. on March 24, 1909. The embargo on gold bar exports, referred to in the discussion of National City Bank's purchase of Philadelphia Bars, prevented the exportation of this gold at the time of purchase and, consequently, it was placed into storage (Ibid. 278 175 and 278 653). The May 17th [March 24th], Farmers Loan and Trust Co. engagement, most likely sold to National City Bank, was reportedly shipped on the Kronp. Cecilie (Journal of Commerce, May 24, 2:5) which departed May 18th to Cherbourg. 2 La Savoie was a French owned and registered vessel. However, the French import table "Tableau Général...," (ENLARGED) for 1909 reports that 59 kilograms, only $38,900, of U. S. gold coin arrived into France aboard French registered vessels during calendar 1909. We can conclude, therefore, that the gold purportedly shipped aboard LA SAVOIE was actually shipped aboard some other vessel. 3Loc. Cit. 4Ibid 1, Confirmed by 280 101, 280 464, and 281 224. | |||||||||||||||||||||||||||||||||||||||||||||||
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The Savoie, of the French line, took $1,500,000 to Paris, shipped by the National City Bank and Lazard Frères. Half of this was in coin and half in bars.
