The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1892-09-20

bOuSiuCEdliOu OO WibuuOiu SdfuS AIoui oS-
The purpose of the prohibition being &c
prevent the docking up" of money by
banks in the interest of spectators. This
10 my mind ought to forever settle that
false charge against national banks.
Again, we hear a great deal said about
national banks issuing their own cur
rency: that in this they are privileged H.
stitutions. that it does not cost them any
thing, and that If they can Issue circu.
latiug notes why not turn the government
printing presses loose and issue an uulim-
tied amount of money that everybody may
have an abundance and TO spare, and al!
that Kind or nonsense. And strange as II
may appear, very many good people De
iieve III those impracticable theories.
want to say to you that | seriously ques-
ton If any of the laws under which
national banks exist are intended &c bene-
ut the banks themselves. The very p 1wel
TO issue circulating notes. about which 50
much fault is found by some people, Is
limited by such conditions and subjected
TO such taxation that We find by Il refer.
ence to the official report OF the comptrol-
Ter of the currency Tor 1891 that Il large
majority OF the national banks III the
United States issue the least possible
amount OF circulating notes permitted by
law. 1t Is in this power to issue notes
against a deposit of government bonds
with the treasurer of the United States
that the polite retormers find SO much
food for argument. WHAT are the facts?
Banks Of $500 capital or less are re-
CURED to deposit bonds equal To one
fourth of their paid up capital, and they
may deposit an amount equal TO their
capital These bonds must be pur-
chased on the market at pre-
MUM. When that is done the
issue of currency of such a bank
Is limited TO 90 per cent fths face of bonds
deposited. This transaction of itself means
direct loss to the bank of 10 per cent in
addition TO the premium paid on its bonds,
plus a redemption fund of per cent.
Hence it Is that everywhere we find banks,
electing to use the minimum amount of
circulation necessary for them to comply
with the law. No one | apprehend VIII
claim that there is any monopoly in this,
or that there is any special legislation
granted to banks which are against the
interest of the public. The general gov
eminent is back of every bank note issued
If you hold a national bank note and that
bank fails. you have no fears about get
ting your money; any bank will take 1t.
Every one receives it as money for the rea-
sons have stated. When you receive a
national bank bill in payment for sub
scription to one of your papers. you are
not obliged to have bank detectOr to
know whether the bank is solvent or not
or whether its depostors will ever receive
penny. The government will take care
of that banks circulation, and il has for
that purpose 100 cents of its own bonds for
every dollar issued together with a 10 per
cent mar gin and ) per cent redemption
fund. Not dollar has ever been lost to
the holders of national bank notes. and it
seems TO me very strange that Intelligent
men should want to discard a currency of
this character and substitute kind Of
wild Cat money for the people and bust
ness of this country. How would it
be if state banks issued their own
money. How WAS it when they were doing
that kind of busiuesss Some of you older
people know all about that. You know
how unsettled business was, and how the
people suffered in consequence. The peo-
pie would deposit several times day
fearing lest during the day some of those
state banks Of issue would fail, and your
so called money be worthless trash But
need no longer refer to that only to add,
that one of the great political parties of
today stands pledged to remove the State
bank tax. II that should be accomplished.
the premium upon our present national
currency, and upon gold and silver, would
go away up out of sight, and the flood
gates of financial disaster would again be
open. | firmly believe that we, as ma
ton, have today the best financial system
the world has ever known, and | esteem it
to be the duty of all good citizens every
where to stand firmly on a sound currency
one that means a hundred cents for
every dollar-a currency that is as good in
Main as California, uniform currency
the nation, and one that has
the confidence and respect of the entire
world
A bank is organized for the same pur-
pose that you editors embark in Journal
ism, namely for profit. 1t is not a charit-
able institution, religious or political As
such an institution the bank or banker is
under the same obligation to the commu-
nifty as any other citizen or corporation,
10 more or less. a banker should be
patriotic, public spirited and charitable,
not because he is a banker, but because
il is the duty of all good citizens
to possess these qualities. What
are some of the services performed 10y
banks? AS already stated, they issue Cir
culating notes, they receive and care for
deposits, they loan money and furnish ex-
change facilities for the people. The prln-
iple services of the banks to the commu-
nity are to those who borrow, and to those
who require the facilities that the banks
afford for the transmitting of funds to the
various parts of the country or the world:
and by affording safe depository for their
customers money. Let us consider for a
moment, the services that the banks rem
der their depositors. | think that some
banks make "A mistake 10 their anxiety to
increase deposits, and meet sharp competi-
ton by according favor5 that are not con-
sistent with sound and conservative bank
ing. 1t is proper. however, TO attract the
idle wealth OF the community and in this
they perform v"luable services to the pub
lie as well as themselves. To illustrate,
your neighbor may have 500 of idle money
that he does not deposit, but keeps 1t at
home in his stockings, or worse yet,
buries it in the ground. You on the other
hand are in need of this 500 You could
use 1t to good advantage. and could you
borrow il for a short time, ii would yield
YOU large returns Now you do not know
that your neighbor has this money, and he
of course does not know that you need it.
What Is the result? Your neighbor re-
ceives nothing for the Use of the money, II
does him no good, and he is constantly
haunted by the fear til at thieves may break
other hand, by not being able to
use this money, have lost au
TO reap a large return from its
Both parties have suffered
uecuniarv loss. Now had your neighbor
deposited his money with some bank. the
moment that he had done so his response
bliity as to its safe keeping would have
beea relieved, aud you could have gone 10
{ he bank where all the surplus money OF
the community is supposed TO be. and Dor
row the funds which you SO sOreiy need.
II is IN this way that banks perform valu-
d ole services to any community by attract
i'm. III the shape OF deposits. all the sur
plus wealth OF the community, and afford
ing common center 10 which money
flows from those who have no immediate
use fox il, aud from which those who re-
Quice the use of this unemployed money
may obtain 1t for the development OF l--i-
innate business interests. Refusing to de
po>lEe this idle money. as illustrated, Is 10
my opinion - contraction of the currency,
aud against The best Interests of the COM
munifv, bat when deposited and subjected
cI.nLL- In IL or liam II l. Ia Fl rcuLarlnn