The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1877-12-22
A had Break,
ISt. Louis Globe Democrat. 10th inst

lSt. Louis Globe Democrat, 10th inst.l
The report of the examiner of the National
Ing and exhaustive document but 1t lacks one
element of value-it was made about four years
too late. It's interest now Is purely historical
and speculative. as showing how great bank
ing corporation was wrecked. and as suggest
ing how 1t might have been saved But II the
examination ON which the, report is based had
been made at the time when 1t ought to have
been made-if 1t had been made upon the terms
aud circumstances contaminated by the Law
would have fallen on those who. would have had
only their own actions to bear the blame Of, and
the banking business would have been spared
Anything which imperis the security Of
s7,ooo,ooo of deposits in single bank imperils
the security of $500 900 Of savings in all the
the most contagious Of outbreaks. A general
stampede Of depositors would be as injuri ous as
a rush ola frightened audience in densely
crowded hall only on q vastly larger scale. and
such stampede may occur at any time II such
rotten institutions as the National Trust Com
aud If the laws which are enacted for the pro-
lection of property and the punishment of fraud
are disregarded and ignored by those charged
with their enforcement, 1t speaks volumes for
the good sense Of the American people that they
have resisted the frequent temptations which
have invited such panic. and 1t would be well
to take advantage of that good sense. while 1t
lasts. to take pr. cautions against the possible
consequences of its being overthrown.
In the case of the National Trust Company, a
would have rendered allure impossible: but
the law was never complied with, and the bank
examiner could not possibly have known any
thing of its condition fer years past. The law
directed that the funds which constituted its
trust should be invested in mortgages on real
estate in the State Of New York. or stocks or
bonds Of the United States or Of Incorporated
cities In the State.' These were the only securi-
ties 1t had a right to buy but the examiner
finds 1t loaded up with wildcat bonds Of every
description. third mortgages and stocks with
three mortgages in front of them. Everybody
now sees that the concern Is rotten and must
have been rotten for some time; 1t makes 80
bad a showing that the Grand Jury has taken 1t
up, and the chances are that some of its direc-
tors will follow the illustrious convicts, Case
and Gilman, who are serving the State at Sing
Sing.
But the conviction of fraudulent director
does no good to any one. What Is needed Is
that fraud should be rendered impossible. not
so much by punishment as by prevention.
There are laws that provide for the reasonable
and proper supervision Of banks. but they are
never enforced. and banks which are solvent
are obliged to see suspicion cast on their repu
tations by such disclosures as the one under
notice. The interests OF sound banking de-
maud that the real condition of all banks should
be at all times known to the public as well AZ to
the bank examiner: and It would be worth
while for the bankers of the United States to
take active steps, and to enforce the authority
they possess for the prevention OF disasters by
which they must all suffer.