The Wheeling daily register. [volume] (Wheeling, W. Va.) 1864-1878, 1868-12-11
REPORT OF THE CONTROLLER OF THE
CURRENCY.

REPORT OF THE COMPTROLLER OF The
CURRENCY.
Mr.. II. X. Hurlburd, Comptroller of
the Currency, has completed his report.
It's chief points are as follows:
The Comptroller suggests that ma.
tioual banking associations which go
into voluntary liquidation be required
to provide for their outstanding circu
lation in lawful money and take up
their bonds within three or six months;
in default OF which the Comptroller
shall have the power to sell their bonds
by auction in New York City, and after
paying to the Treasurer the amount of
the outstanding circulation of tho bank
in lawful moaey, to pay over any excess
that may be realized from the sale of the
bonds to the association or it's legal
Banks that are wind
ing up for the purpose of consolidating
with other banks, or with view of re-
at some other and more de-
sirable points, should be excepted from
the foregoing requirements.
In regard to central redeeming
agency, the Comptroller says: "The
opinion was expressed in the last annu-
al report from this office that it was im-
portant that system of redemptions
for National Bank notes should be es
tablished as early as practicable, by
means of which they should be made
convertible into the lawful mouey of
the country, whether 1t be paper er
gold, at the principal centre of trade.
Without repeating tho argument then
made, the conviction is again expressed
that only by rigid, unsaiiing rcdemp-
ton at central point, can the bank
currency of the country be kept at a
uniform par value"
The Comptroller speaks as follows in
regard to the periodical Stringency in
New York City: "a careful study of The
bank statements Of New York, taken
separately, and the application of facts
so obtained to the aggregate statement
or abstract of the whole, affords valua
ble and instructive information. The
abstract shows the total of loans to be
Sl63. GA 900. An examination of the
statements in detail show the character
of the loans TO be substantially as fol-
lows: Commercial or business paper,
$50, 900, 600; demand loans, S6S,5OO, 900;
accommodation loans, S3,5OO,OOO; sus-
pended loans, 81 500 600; total, SlO6,5OO,-
600. Nine-siXtecnths, or rather more
than half the loan is legitimate busi-
ness paper, the balance is upon call for
accommodation. The amount loaned
on call for commercial purposes is not
stated, but trustworthy information
leads To the belief that it is very small.
The customs and necessities of trade
are of sSch character as TO preclude
loans of this kind.
I'm addition to this direct loan of
SO, 900, 600, they furnished facilities by
means of certified checks to the same
class of operators TO an amount ranging
from Sll6, 100000 to Sl2O,OO0,OOO daily.
On the 5th of October the amount was
el12 100000, and these checks are made
to swell the amount of individual de-
posits. They are credited to depositors
as money, and are circulated and treated
as money by the banks and by their
customers. Yet, when ascertaining the
amount of deposits upon which they
must hold a reserve, or upon which they
must pay taxes, the banks invariably
deduct all such checks on hand. For
instance, on the first Monday of October
they reported: -
Individual deposits, 1924, ,l70, 900; but
deductiUg checks on hand, sll2,sOO, 600,
they had actual deposits ofSlll 10000.
Taking the call loans and the certified
checks together, the somewhat start
ling fact is developed that the New
York National Banks furnish S7O,OOO,-
900 of capital and Sl12, 100000 of credit
for specnlation. The use of certified
checks is a direct initiation to that ex-
tent, which stimulates the stock mar
ket, and keeps the price of large class
of miscellaneous securities much above
their actual value; so that the market
is feverish and tluctusting; and slight
stIiugency reduces the price.
Taking advantage of an active de-
mand for money to move the crops, West
and South, shrewd operators form their
combinations to depress the market by
locking up" money, Withdrawing all
they can control or borrow from the
commos fund; money becomes scarce,
thesrate of interest advances and stocks
decline. The legitimate demand for
money continues, and fearful of trench
ing on their reserve, the banks are
Strengthened for means. They dare not
call in their demand loans, for that
would compel their customers to sell
securities on falling market, which
would make matters worse. Habitually
lending their means to the utmost limit
of prudence, and their credit much be-
yond that limit to brokers and specula-
tors, they are pewerless to afford relief.
Their customers, by the force of circum-
stances, become their masters. The
banks cannot hold back or withdraw
from the dilemma ia which their mode
of doing business has placed them
They must carry the load to save their
margins. :,
"a panic, which should greatly re-
duee the price of securities, would occa-
sion serious if not fatal results to the
hanks most extensively engaged in such
operations, and would produce feeling
Of insecurity which would be very dan
gerous to the entire banking interest Of