New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1873-09-26
THE ALLIANCE OF THE BANKS.

SECOND ISSUE OF CLEARINGHOUSE CERTIFICATES
THE BANK PRESIDENTS NOT IMPRESSED WITH
THE LOGIC OF THE STOCK EXCHANGE.
The Clearing house Association held no
meeting, but the Loan Committee very busy issu
ing the second 100000 of temporary certificates
total of about s7,OOO0OO have already been issued.
Messrs. Williams, Hays, Jenkins Lowery and Bryson,
who were appointed Committee TO take into considera
ton the subjects OF the Stock Exchange communica
,on have yet sent reply, although the Chairmen
OF the Committee and Of the Stock Exchange Committee
have been in conference. The communication has been
the subject OF considerable discussion among the bank
presidents. Some of their views are appended.
One bank president said that he believed the banks
were working smoothly and thought 1t doubtful II the
recommendations made by the Stock Exchange Commit
tee would be adopted His bank was not going to guar
antee the payment OF check for 100000 merely be-
cause it was certified by member OF the Clearing
house. while ignorant of what influences might have
been brought bear the teller OF the bank which
certified Then. again, the communication was incon'
sisten It urged the banks to strengthen themselves
and at the tins asked them not to call In any Sc
cured loans TO brokers within ten days after the opening
OF the Exchange. The fact was simply that the brokers
were anxious for easy return TO STOCK operations,
while the banks anxious on their part Tor an easy
return to legitimate banking business He also expressed
himself in favor OF of part OF the s40OOO re-
serve saving that in the would not
render its relative value greater at the present time
than five years ago, the trade and population OF the
country having greatly increased AT the present
time the West was Withdrawing all the currency IRON
the East his own bank having sent 100000 day to the
West durn the last three weeks Much of this money
would come back again, but lust now immediate renei
WA needed The banking system should be so reformed
that currency would be got into the Treasury when II
was cheap and abundant and released when more was
required In regard to the suggestion that foreign ex
change should be purchased means OF relief he SAID
that this would be war measure the expectancy OF
which was doubtful II men like David Dows how
ever handling millions of dollars IN the produce trade,
came forward and said that they considered such
measure necessary the Of their business he
thought their opinion entitled TO great weight
G. W. Duer President OF the Bank of the State OF New
York said that the stock Exchange propose to the banks
TO guarantee all checks deposited. This simply means
that the banks shall make themselves liable for Tom,
Dick and Harry and guarantee that their checks are
good From that moment the bank becomes responsible
for the check and customer relieved FROM all respon
sibility II In the time the bank should fall the
check would be counted among It's liabilities You
know that no check is usually guaranteed by a bank
until has passed through the Clearing house-that 10
period OF about "a hours from deposit The Stock Ex
change wishes to relieve the broker Of all danger OF the
check being returned after "a hours that lie should
know exactly where he stands The arrangement would
be exceedingly pleasant for the brokers' but would be
a certain danger TO the banks.
In relation to the ClearinRh0u ceruhcates, MI.
Tappan President OF the Gallatn Bank said that with
a debit Of 100000 a day in the Clearinghouse, the
original ssueiof slOooOOo In loan certificates had
been enough and when originally contemplated 500
600 900 was the fixed but was resolved 10 try bali
of the sum as an experiment Ii had been so successful
that the other SO issue IL resolved upon Banks
would apply for when they fer the Necessity of it,
Az 10 the fact large checks could not be paid III
creenbacks. that natural enough In the present
tightness, and would continue until II was over No
bank could pay all checks in greenbaeks at present
Mr. Knapp, President OF the Mechanics Bank, said:
this "a currency among ourselves nobody eau be
hurt by It, while it vastly benefits us, allowing us TO
make cearances without trouble when there Is 80 great
a stringencY In money. The additional issue simply
means that the first millions not enough The
Government plan OF buying In $40 bonds really does
no good. We have not, as rule any Government
bonds SELL and the main part OF the money realized IN
this way goes uptown savings banks ana 10 country
banks I know OF one man who got 100000 from the
Sub Treasury to-day to send to savings bank in Buff
falo He wanted half million. but Gen. HhOuse said
he had enough. The NewY banks have determined
not TO pay any large checks. II man comes IN who
really wants money we give II 10 him. but II II Is
10 speculate with lock up refuse 10 give green
backs, because II would soon probably exhaust u.s."
President Vermilyo, Of the Clearinghouse Association
has not yet appointed the Committee of nine members
to report what reforms are required III the practical
operations OF the banks.