, 1884-06-18

Still, they do carry them on. A private
banker may make a heavy loss, and if not
ruined grin and bear il, for nobody knows
his blnnders; bnt Joint-Stock Bank Direc.
tors have to explain losses, to endure
cross-examination, to listen to insults, and
their moral nerve fails. If they told the
truth they would have to resign. as confess.
ed failures; and they will not do it. They
"carry" the planters, that is, they turn
planters on a huge scale themselves; and
us planting is a business almost dependent
for success upon the personal ability of the
planter to govern great crowds of labour-
erS, artisans, and OVcrSeerS, all intent on
doing as little as possibly, they usually
lose money. The depression continues.
the losses become visible to all men with
eyes, and then the bankers become exposed
to a double darger. They are losing
heavily for a time on their g estates - and
the inflow Of cheap money from dppositOrs.
which is their only advantage over other
planters, and their only chance of tiding
over The dangerous time, stops. "NOtices
OF withdrawal" rain in, and though the
contracts provide for a years delay, the
money might as well be withdrawn at once,
1t has NOT been lent out upon six months
bills, but oil trading concerns from which
"N - 'NNN ~ N'AR t'0 10 SUN W
take three years, to escape without loss.
There is nothing for it, even if there are
CLEANS Of hight ahead, but to stop (; for
otherwise, while the frightened dppositors
who are ~injuring the Bank will be paid in
full, the u|ntrightentd depOSitOrS who are
supporting the Bank to the end will have
to bear the whole loss. The Bank stops,
and there is misery in thousands of quiet
households, whose heads can urge at least
one plea on their own behalt,-they were
not moved to invest in the Bank shares
by any umc0nSci0nable greed. Nothing in
the history Of Oriental banking is so
strange as the moderation of the profits
with which investors are content. SO
long rs the dividend is not below five per
cent. on tne pUrchaSe-m0ney, they will aG-
ctpt what is for many Of them unlimited
rjsl-tlmt is, a risk Of being called upon
for all their SavingS-WithOut even a pass
ING apprehension.
There is, 50 far as we know, no remedy
whatever except for shareholders to for.
bid absolutely the lending Of money upon
any security not realisabie within the
year; and that limits " business exces.
Sively. 1t involves, to use English law
terms, pcremptory foreclosure whenever
the planter anUot pay his debt out of one
years crop and planters, OfcourSe, shrink
from Banks which enforce such a rule. 1t
is, however, if we are not misinformcd, a
neatly mhexible rule with the French
Colonial Banks, which are semi-State
affairs, and is the cause Of the steady
prosperity of those institutions. 1t is, at
all events, the one rule compatible
with permanent safety in that kind Of
business. No method of management will
make banking agents abroad willing to
acknowledge ana write off great losses;
and no care will prevent loans ON estates
in the tropics from involving the liability
to work those estates, which is not what
Banks are made for. The "estates" are in
fact. businesses, and risky businesses;
and the Bank which lends money on them
is sure, sooner or later, to find itself with
a gigantic planting business on its hands,
far too big to manage properly, and taken
up just when falling prices have compelled
the planters to give up the hope Of profit,
and allow foreclosure. =.