, 1873-10-23

If prudent mon, to lot it retnan there until souo
legitimate local domhnd comoB. II thoy cannot
so place i with National Hanks M they VII LIE 20
Of outside, and often leas worthy. parties tho
aorvicos Of tho city uoto-broaer will DO sought,
or they will place the money at home
T. hands whore posoy dhey
In Short II ther whole reserve must le abeo-
lutely unproductive, will not tho temptation DO !
constant to roduco tho reserve to tho minimum,
greater w rtak Tho Toault would be that tho re-
serves Of country banks, Is rulo. would be
smaller than now, thcir money would still ind
ita way to tho city for Investment, and, by refus,
only be relipquiahing one Of their most profit
able and legitimate functions, viz: tho relnvess7
nent OF money for commission, only to 500 It
60 into hnnds that would DO by no means lkoly
10 discharge tho trust 30 well na they.
1t III probable that Wall and Pine htroota would
get rs much money, and cheaper money, than now,
With the difference that they would be ess closc-
" looked after, md it IL rumorod that tho deni-
| zons thereof will benr Watching. SO much,
briefly for tho banks reooiying tho intercat, and
| now as to those who pay 1t, for, OF course. no
! ono wants to preserve and keep puro tho country
bankers at tho cost Of demoralizing their breth-
! ron in the cities.
It will not bo questioned that tho Ananciora
In tho commercial coutres have superior facilities
| for making perfectly safe temporary Investments.
Thther arc sont tho marketable products, the good
l
and thlther flows tho money to buy or carry
them. That Payment OF interest by the banks
| auRments tho accumulation OF money then is
probably true. though TO What extent Is not 80
THAT the Capitalization Of money ia m un-
mitigated evil III not no certain. Like The diyia-
ion Of labor, It ia n concomtant Of civilization,
Ana no. oi rpoS
complicated. There would aoem to bo no reason
why it should bo more unproductive there than
its stay b. Hn'tea
70 read some OF the editorials on the subject,
ono would almost infer that the writars would
haYo no objections to tho "sicioas system" II
the money only, wont to New York anu Is mChicago
bo called on for til Yes, that ia tuo.i
Il Is quito aa impossible to keep it
there indefinitely even With tho
baiancos. a. il is to koop i from going thsre 1t
This circulation Of the currency would not
obtain unlosa 1t was necesshry--unleBs 1t paul
botween it md ito circulation Of tho human
| franc is obvious oven il fanciful. Like the
latter It should visit no pnrt. Of the organism
without doing some good work.
West ought not, md probably do not, have any
are S rot fitful nor Irregular. They A1e governed
by laws as easily studied nna .,5na ,n.eFPretod .n
.. tic 5sutor WHO fails to study thIs
seosag Ss b. fsas R9at st %Ss
thought and sagaoy 70 tne emtsoie "a n ssvao
! mindful Of tic fact that ho will need It whom
night comes nor would any amount OF leglala.
ton on tho subject Of interest furnish his brain
with the couvolutiopB necessary to make him d
| safe custodian of any ouo'a money.
Every banker knows about what the average
of his deposits is, and what tho curve Of yara'
. tion usually H. Experience hns shown him that he
) can loan q givon percentage thereof, and, Il op
portunity offers, ho will certainly do 80, without
0 reference to the causes which brought the
j money to hin vault. "
o II ho slould pay no intoreBt, and bis doPosl
i line were undiminiahed, ono OF two things
y would rcButt-for 1t is doubtful 1t, nfter th'
O scaro Of this panic waa over. he would keep I
i very much higher reserye-ether his 8tooAhold
= = what VII would DO cut oil from bis depoBitors. A
+ for tho formor, bnnk- stock is now tolerably 70
q m,nerativo and for the 1attor it ia popular no
ton that cheap money makes speculation rlie t
!. would not bo so largo-bnnk balances would b
4 leeYoued throughout tho country. What lie mus
' decide is, whethor he -profers deposit Q
) 81 ,oOo 900 With say $50 900 net profit, or Dc
:" With profits increased, d though by Il =
:, moaua in proportion. 70 prefer tn
!, former would pe different In degroe only fror
L. the merchant who should Ray ho would buy on'
CO soil at a profit Of s316 per cent. It would b
is prudent and safo beyond question, but it In no
~ by such courHe that cities like Chicago have beo
% built or tho worlds commerce reached its pres
nd | ent proportions
in II ali intorest on call loans woro stoppad-atl
O. TINT ia what this agitation mcans-at once MOI
Nv or less OF the money would DO diverted from tn
~ roady-monoy buRiuoas Of commerce and put lnl
,e- permanent, but paying, Investments, thoro wou
=" 10 more boarding Of greonbacks, and wo shon
rk loar moro complaint than over Of tho insnl
ID cheney OF the hard and faat line OF $4,000 000,0
,w 'v That banks will now pay thcr donoHitora i
co torost whore heretofore they would not is
ro. oyidonee-not that they are unaata or losa p!!
an IDENTIFY managed than formerly, TOT panlcs , !
it most prevails, las fowor and mlller panl
be than any country whose business is Of equal p!
" portions-but is mn evidenco that they are wi
fo Ing to work on Hmallor marglns, like the mt
hit chant OF to-day, and make tho profits good
Increased business.
am Il rosults In koeplng . larger pnrt OF the !
,lo tions money whore 1t 'e more lmmeaiat.
on capable Of doing . larger ahara Of tue work
tod the world.
Thoro are, OF course. 8omo dobatablo poil
ng connected with the subject, as. for example,
Of rate Of interest. It would SOON that the y
bis York banks could not afford to pay 10 high
eBy rate on balances Az those OF Chicago not aic
or because tLoir maximum rate OF interest - W
ous cont loss,-but because It Is doubtful Y, OIL
ut tllinga being equal, tho ultimate ouasoulanh
il tho nation'a rosoryo eau afford to pay so high
lty, tho intermediate ones. Whether thoy will or
ny they arc obliged to kcop larger percentage
any in their yaults. But over, II tho New York bat
IN 1 should doode that they must reduce tue rate
do away With It altogether, in order to do just
orc to tie trust which Ii forced upon thom ~ ma
god gors Of the roBorvo, 1t does not folio" that
lut would not be oxpodiont and safo Tor Chic.
had banla, for example, TO continue to pay
.Hy cent OH balances, which they can well aiIord
ID, / 90.
ard But this question Of reserves Ia altogether
any big ono to 10 hero discussed, III fact
gIaG Whole aubIeot il of that nature TINT II eau
hjH woll bB treated within newspaper ITllta.