The Durham recorder. [volume] (Durham, N.C.) 1879-19??, 1885-07-29
MONEY AND BUSINESS.
why BANKS HsAP UP IDLE MILLIONS.
New York Herald.

New York Heraldl
The increase Of nearly s2,0OO,00(
In the surplus reserve of the New
York city banks during the weeks. a.
shown by statement used by the bulls
IN Wall street as an argument why
stocks should advance. The presi.
dent Of q prominent bank pooh.pooh.
ed the theory.
"fhe simple fact" be said, .sis that
the great mass Of the people have
been growing constantly poorer,
and as the money passes out Of their
hands it finds its way into the banks.
In times Of general prosperity the
working people have money, and as
very few Of them have bank accounts
they carry more or less money in
their pockets. Suppose that ten
millions o. persons in good times
carried each S. in his or her pockets
Hard times with enforced idleness or
diminished wages, makes il difficult
for them to make both nnds meet.
They spend their surplus and what Is
the RESULT Why, there is in the
aggregate, s50,0O0,000 released. Busi.
ness men or persons living ON income
VINO formerly carried, say, 500 in
their pockets, now carrying perhaps
800; those who used to carry $50 now
carry $40, and so on until you reach
the great stratum Of clerks, mechan.
les and Others, who used 70 carry s.
aud who now have none TO spare.
Ard this movement does not apply
on.y TO the smaller amount of pocket
money carried'by the people, it ap.
plies also 10 larger sums. Tn time
Of prosperity, when money Is widely
distributed among the people, small
amounts (which In the aggregate
make up a vast sum) are boarded by
working people in all parts of the
country. In chimney corners or where
not, against rainy day. In times Of
depression and enforced idleness they
pay out these sums for living ex-
penses, and thus the money passes in.
70 the hands Of richer people who can
hold II, and these deposit il in the
banks.
MONEY A G-GovERNAIENT BONDS
Thus, in proportion as the people
grow pooer the hanks grow richer
richer only in funds, however, for the
very stagnation Of industry which
brings them this money depriyes them
Of the opportunity Of using any con-
siderable amount with profit 10 them.
selves. A grea. deal Of Chicago and
st. Louis commercial paper Is now
bought by the banks Of this city and
and Boston. One New York bank
discounted q very large amount of
notes Of q firstclass Chicago concern,
at three and half per cent. Brok.
ers from the East are drumming up
paper In the principal Western cities,
and the business man who a few
years ago asked discounts as a favor
Is now followed into his counting
room BY these men, who ask him
whether he does not want TO borrow.
The broker gets q commission ofper-
haps onesixtecth Of one per cent. on
the transaction. This Is another il.
lustration Of the difficulty in finding
employment at present for capital.
The disposition Of savings banks
and other institutions 10 put their
money into government bonds con.
tinues, and the very highest class Of
railway mortgages are in moderate
but steady demand by conservative
investors. One Of the oldest savings
banks in this city bought 100000
Of four per cent. governments from
one concern. The price paid was
1913. One Of the most prominent life
insurance companies in the city
bought during the week s250,c00 Of
this class OF bonds,