Delaware tribune. [volume] (Wilmington, Del.) 1867-1877, 1869-12-16

REPORT OF IL. N. nULBURD, COMPTROLLER OF
TnR CURRENCY.

The report Of the Comptroller of the Cur
rency will be found Of great interest, not
only because OF the importance OF the sub
jecl he discusses and the suggestions he
makes, but because of the necessary c0Dnec-
tion of tue national bank question with the
future financial course of the government
The comptroller refers appr0vingly TO the
new system oi calling for reports The condi.
tion OF the banks. They hablually keep them
selves in better condition. He thinks that
the privilege OF going into liquidation is
liable to abuse, and that some banks have
been induced to go into it with the expecta-
tion of reaping the benefit of their circulation
while doing business under State laws. He
recommends that all such banks should be
compelled to deposit legal.tender notes for
their outstanding circulation, and fake up
their bonds within sixty days. He recog
nizes the importance of the special examina-
tions which are provided for, and recon-
mends an increase in the amount of their
compensation. Considerable space is de-
voted to the question of a central redeeming
agency, the establishment of whcn he rec
commended in his previOIs report. He cor
rects some misapprehensions as to its effect,
and argues that by the adoption of one gen.
eral agency, every bank In the country will
derive its just proportion of the benefit of
the circulation. He thinks the effect upon
the banks would be salutary, and that the
system would operate as u check upon the
speculative tendencies of the times.
The comptroller takes strong ground
against banks engaging in or promoting
speculative operations, and therefore objects
to hiring deposits, by which he means So
Letting loans by the offer to pay interest on
on them, practice which prevails extern
sively. The banks paying interest on de-
posis have to use such funds in way that
will be profitable to them, but as they are
payable 0n demand they eau only loan on
call. Call loans as a rule are only made to
brokers and operators in stocks and gold,
and the facility with which such loans can
be effected at low rates of interest fosters
speculation. 1t leads to the present condl-
tion OF monetary affairs in New York city,
where money for speculation is six or seven
per cent, and for trade ten or fifteen per
cent. The comptroller says: 1.-The fact
!" that the reserves OF the country are hawk
"ed on u street and are rendered and used
g for speculation, is sufficient ground for an
" interference OF the law"
He calls attention to the fact-which per-
haps some banks need to he reminded Of
that national banks can afford 70 lend their
money al lower rates of interest than kank
that issues no circulating notes. He esti-
mates that national bank Can derive as
much profit from seven per cent. interest as
a private banker can from twelve, and thinks
that as the ordinary charges OF the TWO
classes show about that difference, the busi-
ness public deii,e great benefit from the
circulation of the banks. He thinks the
large profits which were made by the banks
during the war and in the earlier days of the
system, are Al AN end, and that as the pre-
MUM on gold diminishes, they will make
fair living profit, and no i.ore.
The comptroller devoes the latter part of
his report 10 II consideration of II sound cur
rency and free banking. Our currency now
lacks converliblity and elasticity, which are
requisite to II sound currency. One kind
would also seem to be enough, and the comp.
troller decides in favor Of bank circulation
because it would possess the power of adapt
ing itself to the exigences OF trade. He OPP
poses the argument that government should
furnish the currency for the sake of the pro-
fit on the circulation. OF free banking he
speaks iavoraby, thinking that it may be
established with safety by Withdrawing a
legal-tender dollar for every dollar of bank
currency issued. Banks might also he es
tablishes on specie basis, to issue and put
in circulation gold notes, which would only
be anticipating the resumption of specie pay
meuis. The whole report is deserving of
careful consideration