The Dallas weekly herald. [volume] (Dallas, Tex.) 1873-1885, 1884-08-21

tbls iltnp IA Wna pft,uipi aud decisive,
Mn VIM were iHfthpst away iruU the
exciting sDnnCs can irslilN "a lhr rulirl
their actions gave us, IN the CITY "
Immediately restored confidence In the
hanks, and NJ all interior points II
Tho adoption hy the Now York hanks
uf the su-cnlcd Clearing House cirllh.
Gates WIS practical though partial
recognition of the principle here con
tended for.
IL was practical, becauso through the
use of these certificates every bank crod-
itor at the Clearing House, became u
willing lender of it, entire credit bal
ance To any debtor bank or banks deslr
Ing To borrow,
II war partial, because the benefit of
this operation was so much restricted
With u larger cash reserve hero con-
tended for, and with the right Ia raise
interest rates 50 rs 10 bar out more
pASICKN BORROWERS,
the issue of these certificates would have
enabled the New York banks To supply
every legitimate call for loans. As II
was, they were In a.positlon 10 iond with
considerable freedom, rs the total cash
reserve was made available at any point;
but il would seem, II observation may
loo trusted, that such power was not en-
crcised. A vigorous policy OF contrar-
ton in loans was the observed RUE
IA policy which was oppressive
to debtors. injurious 10 the
banks themselves, and detrimental to
its widespread effects tn Industrial in
tcrcsts everywhere. This policy found
"A ready IL not necessary imitation III all
the cities and villages through the land.
But the general adoption of such II
course does not Justify IL ~ wise,
though where a common sin prevails
criticism l. disgrmcd, even IL the sin bc
acknowledged. The prevalence of evil
policy makes individual exception dill
Ecult II not impossible.
A banker who should try the remedy
OF expansion, when all his ncighhnrs
were enforcing contraction, might soon
| find his reserves transformer 10 MS
| noighhor's vaults.
The principle does not admit of par
tial application. IL must be thoroughly
embraced and generally acted upon, or
| il will fail.
If these reflections upon tho remedy
for financial panics are justly founded,
four
|, GESERNL SUGGESTIONS ARE IL ORDER.
! First-The keeping of cash reserves
considerably larger than - per cent. In
ordinary periods by banks in the reserve
cities.
Second "A repeal of usury laws thus
leaving the price of money to he regula-
ted, rs are all other commodities, by the
law of supply and demand.
Third-N removal of the injurious re-
striction now imposed by the National
Bank act. \ restriction which if OBJ
served in time ofpanic will prejudice the
bank and imperil all business interests.
Fourth-The adoption OF some rule to
secure "A uniform practice in loaning
freely in times of panic out OF the cash
reserves.
II will be said that public prejudice
| renders ii idle to expect repeal OF the
inusury laws. This must be, for the
moment, admitted. 1t still remains,
however, that true principle, make th' lr
way and receive final adoption through
being held to the public mind until their
value Is recognized.
| 1t will also be said in answer to the
| fourth suggestion that no rule of the
| kind indicated can be devised susceptl'
! bic of enforcement. In such All answer
| ] cannot concur.
THE CLEARING HOUSE CERTIFICATES
prove that cooperation, in one respect
ut least may be secured. a trusted
committee of the Clearing House asso-
citation issues these certificates against
| the pledge of securities they deem suili-
! oient, and all members receive the GER
icales at their face. Why could not
| another committee OF equal prudence
make all the loans in times of panic To
/ the public, with funds furnished for
! that purpose by all the banks, in proper
| ton to their cash reserves from day TO
day?
This is merely suggestion to indi-
! cate that through study and reflection Il
resolution can he found. Other sugges-
| lions to meet this end Will no doubt be
Offered To your consideration. In this
hasty Presentation | have purposely
omitted many details of argument.
Several questions remain which no
doubt affect it--luestionS of interest on
! deposits, the methods and
/ DIRECTION OF BA>K LOANS,
and other questions quite subordinate.
If your minds are engaged with the
theme, its full treatment is in your
| hands.
Ii is ut last, perhaps. a choice between
OWLS. 1t may he dangerous 30 loan. 1t
is more dangerous to refuse.
/ 4 panic is an agent of destruction
| Left to run its course, like Il couilagra-
/ ton, it will cease only when all it feeds
on is destroyed. With approved engines
| we put out incipient fires. With I'M
proved guards, we have brought down
! the percentage of steam boiler eXplo-
sions to II practical nullity. Dynamite
/ is transferred in safety from one end OF
in quarry and mine. Electricity lies I'M
der control, and lights of 2O,OU-candle
power turn night into day.
Shall we now admit that in the realm
of banking and finance higher degree
of perfection cannot be reached? our
conuuests in other fields are II sufficient
affirmation that wo shall not fuil in this.
Secretary Marsland read the resolu-
tons submitted by the Executive Coun-
sci, as follows:
Resolved, That it is the sense of the
American Bankers association, that the
coming of the standard silver dollars of
tl2la grains, is against tho welfare OF the
country, and recommends to Congress
disconiinuance of such coinage.
A committee of three was appointed to
invite Hon. William Groesbeck to speak
upon the question.
Mr.. Groesbeck, of Cincinnati, re-
spCn led.
He favored bi-mctalliclcurrenry and
went on to show that for centuries gold
and silver had been of equal value as
currency. The change took place in 1871
past could be done in the future. 1t
might be impossible for one country to
carry gold and silver alone for its cur
| rency and he favored under the present
condition, the suspension of silver coin
age in the United States until other
nations took action on the subject.
vote of thanks was extended to Mr..
ried.
The following resolution was adopted:
Resolved, That, in view of the fact
that the articles of the association OF
the National banks of the country are
rapidly expiring without sufficient IN
ducement for renewing, owing to the
constantly diminishing amount and
high prices of Government bonds,
upon which the banks circulations are
based, thus threatening serious curtail-
ment of the currency of the country,
and since bank-nOte circulation is abso
= a 4 Inr Ia,