Lancaster daily intelligencer. [volume] (Lancaster, Pa.) 1864-1928, 1884-09-09
Lancaster fntelligenrrr.
TUESDAY EVENING, SEPT, o. 1884.
The Frequency OF Bank Failures.

The Frequency OF Bank Failures.
In its towns adjacent to New York,
NewJersey is remarkably subject to bank
defalcations, and the reason, doubtless,
js in that proximity. The opportunity
for speculation, afforded to the officers
Of these banks is as great as though they
were located in New York, while at the
same time they have looser rein held
upon them than Is maintained over the
officers Of the New York banks by the
business methods and habits Of the me-
tropolis. New York bank officers have,
1t is true, lately done great deal to
bring into contempt this supposed sharp
ness of supervision by New York bust.
ness men, but the banks OF New Jersey
are still ahead in demonstrating to the
country the unreliability of the security
afforded to the keeping Of its cash.
Through a number of years past we have
been used to hear of the breaking of New
Jersey banks by the dishonesty and
speculation of their officers. In other
parts of the country bank failures have
iOi " bOuu many
been very rare, and a great deal Of
confidence has been exhibited by the
community in investment in bank
stocks. 1t has always seemed to us that
there was, in the light of manifest
possibilities and the prevailing banking
practices, too great degree of that
confidence. Investors have looked only
to the large dividends accruing
from the profitable business Of banking,
aud have taken too little into considera.
tion the large risks attending the
management of their money by others.
They have to insure themselves against
the lack of honesty rs we'll as lack of
judgment Of one or two men, who
practically manage the banks affairs,
and have to take the ordinary business
risks as well and the dangers of panics
and financial convulsions. 1t is true
that a bank, with good business wisely
managed, must always be sound aud
profitable but wise management is not
insured to banks. The directors are not
always wise, and often they have little
w wv WIN lIo Pitoiutlt
and cashler-often only one of them-are
the managing officers, and upon their
integrity and business aptitude the
soundness of the bank depends. 1t is re-
markable, that throughout the coun
try generally there have been 50
few failures of banks. It is creditable to
the reputation Of bank officers that when
thor pnwar is so great they have abused
it so little; or have at least rv-u 90 SOL
d I'm discovered in its abuse. No doubt
bink officials have abused their trust
and profitable results to their specula
be supposed that all bank officers fall on
the wrong side of the market. These
are the times in which the soundress of
banks and of business men generally is
tried and found out. Business is bad
and confidence, is lacking. 1t has been
supposed that the crop of failures was
over, aud that those who have struggled
so far to keep their heads above water
would swim out. The failure of this
New Brunswick bank will give
occasion to some to change this
opinion but it is so obviously
ciDnected with the stock market as to
only show that there is no ground for
confidence yet, that trouble is over from
the depreciation of Wall street values.
1t has been fer some time apparent that
the quoted values there are fictitious
and maintained by the great traders in
stocks whs have the power to mark their
Wices for time at their pleasure. 1t is
quite certain that when they can hold
them upNn longer they will drop away
down before the general investigating
public picks them up. A fall in Wall
street prices is very probable, but it will
not now have the power to affect the
business of the country, OF which it il
no longer representative. Stock ya,ues
have been going up this summer while
commercial values have been going down
and stock quotations in the immediate
future are likely to go down while the
commodities of commerce so up.