The Arkansaw traveler., 1884-02-23
A FINANCIAL ARTICLE.
Peck's Sum-

It Is noticed that there are several bills before congress to regulate banks and banking. If there is anything that needs regulating more than banks, people do not know what ii is. Banks, as they are allowed to run, in many parts ofthe coun- try. are not much safer than a stocking leg to pu: money in, and the government cannot take action to make them safe minute too soon, and while about Il make all banks safe, whether national or other wise The national banks are compelled to make their circulation good by depos- iting government bonds, but they may
 have million dollars on deposit and
 have the cashier steal it, and the deposi-
 tors can whistle for their money. What the country wants $ banks where money IS safe. and where i, can be got when the
 owner wants It. The way II IS now par
 ties who are supposed to be good, start a i bank. with fifty thousand dollars capital. l Five good men subscribe ten thousand
 dollars apiece and the bank opens for
 business. Nobody knows whether the
 fifty thoueand capital Is paid in. or fl 1t IS
 l, may be taken out the same day by the
 stockholders. Depositors tall over each
 other to get in the bank to deposit money,
 and before the bank has d chance to loan
 a dollar, thousands of dollars have been deposited, which they loan. If Tom wants ! ;o borrow thousand dollars, he goes to l the bank and borrows Dicks money and
 pays to the bank ten per cent. interest 1 What does D.ck get: Well very likely { Dick gets left. The bank may be lend-
 ing Dicks money for years. and making 1 a fortune out of Dick. jus, for the hand | ling of his money. If he lets 1t remain
 three months, he may ge; three per cent. ! interest on II. Finally Dick needs his
 m oney in his business, and draws ii out,
 and after d while he wants 10 borrow thousand dollars. Does the bank accom-
 modate Dick: You would think tha, after the bank had made a heap oi money
 lending Dicks cash, tha, Il would be no
 more than right to help Dick a little. Dick can have a thousand dollars fl he will get two good endorsers He didn't ask any endorsefs from he bank for his
 III aney, but he gets the endofsers, and
 he bank kindly lends him Tom money which Tom has deposited. II Tom wants
 his money. the bank pays him with money that Harry has easi deposited. and
 everything is lovely. Bgt when all the
 ooys "ant their money IL ontc. he bank
 loses up and hangs out q sign that the
 bank Is temporarily embarrassed. bu, will pay hundred cents on dollar as quick
 IS the president gets back from Europe and they find the cashier. Deposi are allowed to send an attorney into the bank
 and he finds everything there all right
 cNcep, the money. The stock of the bank has been hypothecated, that Is, the stockholders have placed II in the bank
 and borrowed Tom and Dicks money on
 Il. and the stock Is put in as assets. Tom
 and Dick can have some of II if they
 want Il, but Il IS not worth the paper II Is i printed on. The affairs oi the bank are
 wound up, the old notes tha, have been taken for the money of depositofs are { sold for song, and depositors get fifieen
 een,s on the dollar ard consider them
 selves in luck. X depostor meets the pFeSiden, a year after. riding in his car i flage. and says. say, thought a nation
 al bank was good. though, you s.ij ] the goverpmen, was ai the back ef l
 natloaal bank" The presiden, says, 4 you have any of our currency that we, ls-
 sued. you can have ii redeemed a, W ash rteton. But the depositcr never saw d dollar of the@ currency. If congress passes d law that nobody can run a bank
 without putting up dollar worth oi
 real estate for every dollar the bank re- ceives in deposits. so iha; any bank Is good that Is allowed, to do business. there
 will not be so many times in the history
 of the country when everybody is ou, of
 money. with plenty due. and unable ;o collect | cent. A banker has no more right 10 do an unsafe banking business
 than any other man. but the way many
 banks are run the depositor is iieeced
 worse than he would be IF faro bank.