New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1884-08-15
yUr D,NKFRS ~ COUNCIL.

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THE BtNKERS ~ COrNCH.
The meeting of the American BankerS Asso-
citation this year In an unusually interesting one
The recent financial disasters have pFmly con
WINGED the bankers that many reforms arc
called for i'm the conduct of their business ana
IA a result soma of the kccncst minds III the
community have been exercised In devlsihg
new checks and safeguards. 1t Is encouraging
to see that the bankers are fully aware OF the
need of reform and that they have lost no tlme
in seeking remedies for the defects OF the pres
emf system. IL is not less refreshing To en-
counter 80 much clear and sound thinking and
plain Speaking as are TO be found in nearly all
the really able papers which have been read
before the Association, and which together
cover every important financial issue. And Ii Is
TO be desired that members of Congress cSpecl-
allv should take some pains to acquaint them
selves through these papers with the i!P'N'
conclusions of American financial experts to the
end that when questions Of finance come mp III
Washington the Nations lawmakers may have
some solid standng-gr may be III posi-
ton to legisatc ntelligenty and not rs Is too
often the case ut random or on superficial ana
! erroneous theories.
Among the wise things said at Saratoga was
the observation of President Gage on the policy
of liberal use of the cash reserves in time OF
panic. Experience has c0nclusivey shown that
when the banks of the reserve cities contract
their loans in time of stringency, their whole
influence is really eNertcd To aggrayate the
! panic il should be their main function to pre-
vent Yet the liberal loan policy has seldom
been pursued save by the Bank of England
though as President Gage says, the New ork
banks occupy position analogous to that oil
the Institution named. aud if thcy do not relieve
the pressure thcv may intensity the panic. But
il i clear that before the libc.ai policy can be
adoptrd there must be- such change ~ VIII
strengthen the banks in panic times. heretofore
one of their chief hindrauccs has been that then
methods of business have tended 10 dlsSlpate
their funds unduly during the mclpicnt stages
of panic. so that when the severe pressure came
they found themselves dangerously extended,
and were driven to contraction III self-defencc
lust when they should have been able to 20 to
the assistance OF their clients and customers.
President Gage suggests as precautionary
measures the keeping of larger reserve than
% per cent by banks in reserve cities repeal OF
the usury laws; removal of the restrictions i'm
posed ON the National Banks and the adoption
of some uniform practce.in lending freely ont
of the cash reserve in time of panic. The last
suggestion can hardly be enforced because
every bank must finally be controlled by the
state of its own business. and no rule can apply
TO diverse conditions. The other points may be
utilized. and that regarding the increase of the
reserve viii perhaps have to bc adopted.
Many other highly interesting papers have
been read at Saratoga, bat in view oi recent oc-
cuucuccs one of the most timely was that bl
Mr.. b. II. Comrgys on The Conditions of Safe
Banking The public will certainly agree
! with the cssnyiN that there sccm to be- some
persons engaged ia managing banks who have
! very inadequate ideas of the gravity aud re-
"hponeihilily of their position Aud while
| such pcrAunn ARE FREQ 90 undertake. such enter
| ptiscs IL may appear too much To expect that
| they will rcyOutloniZe their methods In order 10
conform with views for which, as their course
shows, they entertain no respect. Nevertheless
Mr.. COmcgys's description of what bank should
be goes to the root of the NATTER and At is safe
to say that if our banks came even halfway up
to this standard they would be the most solid in
situations in the world This Is what he said ::
bank may be said to DO in good condition when 1t has
an adequate capital mot largej contingent fund at
least half large and no suspended debt or overdue
paper when ts deposits free Of interest ana three or
four times the ofits capital; when its dealers
supply IL with business paper to the t needs
when liberal salaries paid to its officers and clerks
when trained man in reserve for every position
that may become vacant; when there is tension fund
ADEQUATE to the comfortable support OF its worn
clerks; when II has Board Of Directors are not
tent to be mere figure heads hut who understand their
business and remember their qualification oathsirec
tors ho count cash frequently and without notice 10
anybody insist that every employed in the
bank shall take Ii vacation OF at least weeks every
year at which time another person shall do his work.
and who believe this dogma, that nothing ia good
| enough that can be made better"
That is high-water mark in banking, undoubt-
edly, and perhaps nothing short of that is abso-
lutely safe banking. OF course such standard
| cannot be attained at once, nor generally while
greed of profit is more influential than ally other
consideration. Perhaps nothing but marked
growth of popular distrust compel the
necessary improvements. That distrust, how
ever. must be developed unless voluntary re-
form is entered upon. The American Bankers
Association can do much to stimulate remedial
action, but its most effective work would con-
sist In eliminating the unsound element itself.
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LIEUTENANT GREELY'S REPORT.
| Lieutenant Greedy has confirmed the report
| fhat ono of hia comnanlOns Waa ahot hv HE