The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1877-12-04
CURRENCY AND REsUmPTIos

CURRENCY AND RESUMPTION
The Shnre Of the National Banks
in Resumpti0n-The Important
NeFviee they Can Render 20 the
COuulry--A Series OF Parallels
from Experience.
WAsH1NGToN, December 2O.-The fol-
lowing areextracIS from the report Of the
Comptroller Of the currency on the sub.
iect Of 'the banks and resumption y
After reviewing legislation that has here.
tolore been taken by The United States
and by States as preparatory to specie
resumption after the various suspensions
that have occurred, and showing by
tables what proportion Of coin and notes
have been held by banks during three
periods-arst, from 1885 to 1913; second,
from 1850 to 1885, and from 1870 to 1877
the Comptroller continues II will be
seen from the various tables given that
the averages strength Of The national banks
Tor tue last eight years Is fully equal to
that Of the State banks during the peri.
DDS Of suspension and resumption In for
mer times, and II resumption is to take
place upon any fixed date, the national
banks will be certain, "a a matter Of pre-.
caution, TO strengthen their reserves be-
yond the averages here given. It cannot
be doubted, therefore, that the national
banks will be prepared 70 redeem their
circulation notes at any date Of resump.
ton which may be fixed upon. But while
II is admitted that the banks may easily
pay in coin their circulating notes, it ia
said that it will be impossible for them
to provide in the same way for their de-
pOsiIs. Those who take this view pro.
coed on the assumption that the banks
will be called upon to pay their deposits
in specie. This was not true during any
former period Of specie payment, and is
le's likely to be true under the national
banking system than it was under any
previous system Of banking.
The banks in this country, from their
frat organization, have, in time Of re.
sumption as we'll as Of suspension, receiv.
ed from their dealers current bank notes,
and have paid out the same. This il true
to day in England, Scotland, Germany
and France, in all Of which countries the
bank note Ia preferred, as a-EnlC, 10 either
gold or silver. Only ANAL portion Of
the bank circulation Of the country at any
period prior to 1853 was either safe or
convertible, and the losses 10 the holders
Of bank notes are estimated to have been
not less than five per cent annually upon
the whole amount Of circulation outstand.
ing. Yet even this circulation, poor and
defective as it was, was freely received by
the banks, and was paid ont BY them to
their depoSitors, so closely identified were
the interests OF the one with the other.
The notes which were returned FROM the
commercial centres Tor redemption were
readily paid out and circulated at home,
and the demand for specie, whenever Il
existed, was almost entirely owing either
to an excess OF currency or to q want OF
confidence in the institutions which issu-
dit. The people throughout the country
now know what, prior TO 1863, they could
not know, for ii was not then true that
every bank note is safe beyond peradven-
tnre, and that il these notes are not paid
at the counters of the banks which issued
them they will be paid at the Treasury
Department in lawful money, and that
the securities held therefore are amply
sufficient for that purpose. No reason
exists, therefore, why the people, who
have not during the last fourteen years
lost one dollar through the use Of bank
notes, should decline 10 receive payment
of their deposits in such notes. These
notes are not only guaranteed by the
Government, but they are received by it
in payment OF all taxes and other dues
except duties on imports, and are disbur-
aed by it in payment Of all demands,
except interest on the pnblic debt and in
the redemption Of national bank notes.
The national banks hold eight hundred
and eighty millions OF loans made to the
people, and each bank is required, by
section &, l96 Of the Revised Statutes, "to
take and receive at par for any debt and
liability to it all notes or bills Issued
by any lawfully organized national bank
ing association" There are, therefore,
eight hundred and eighty millions OF
Liabilities Of the people due to the nation.
al banks-a sum largely exceeding the
whole amount Of depOslts-which may
be paid in the notes Of any or all of the |
national banks in the country. The ma
tional bank notes are, therefore, very diff. |
ierent in character from the heteroge.
neous bank notes formerly issued by
authority Of the several States. More. |
over, the deposits Of the banks are large
ly owned by their shareholders and BY
their borrowers, and surely business men
who look to the banksfOr accommodation,
and stockholders whose profits depend
upon their successful management, will
be the last to conspfre to ipjure their
credit.
Deposits consist chiefly OF bank credits
and are derived largely from the discount
Of commercial paper, and are paid main.
ly by transfers upon the books, and not
with either coin or currency. Through.
out the country all large payments are
made, not with money, but with checks.
In the principal cities these payments are
accomplished through the operations Of
clearinghouse. During the last twenty.
four years the exchanges OF the New
York Clearinghouse were four hundred
and filty,iour thousand millions, while
the balances paid in money were less than