The times. [volume] (Richmond, Va.) 1890-1903, 1893-06-03
rur DISTRESS. IT'S CAUSE AND CURE

barrassed by IT, Though the free sllverit'
will not admit that his cheap dollar. by
alarming capitalists has caused this con
dition. he Is forced by what he sees with
hts own eyes 20 admit that the condition
exists. This being so II strikes the casual
observer with establishment that money
can be borrowed in New York at from
2 20 per cent. When he is told this fact
be IS not told the additional fact that all
this money is loaned. as they term II
there. ION call" That IS, the borrower
| agrees 10 return the money on an hour 5
notice and pay for It while he holds It
at the rate OF 3 per cent. per annum. He
must also deposit with the lender first
| class negotiable securities. considerably
| greater in amount than the money Dor
| rowed, which can be sent into
| the New York Stock Exchange
! and sold on a moments no.
tice for cash. Thus can money be
| borrowed in New York at these low rates
and not otherwise. or what good IS
this low rate in New York TO the peo-
pie at large. II is simply a mockery to
them in their distress 10 tell them Of
g.
What causes this extraordinary state Of
affairs? The cause IS as plain as day
20 the thoughtful man. The National
Bank act confines bank issues TO ra-
tional banks From the nature Of the
CASE these grow up I'm commercial CEN
tres only. From a variety Of causes that
same nature makes New York city their
great central depot The currency that
they issue being currency Endorsed by
the Government. passes at par all over
the Union: the New York banks bid for
al that they have. and they get II. Con-
seQuently. II there IS any money in the
country. New York has all Of It that she
wants. So long as the New York banks
have plenty Of money they know they
can always find an abundance OF GUS
toners anxious TO borrow at paying rates.
The human mind has an inevitable ten
dency 10 what we would call gambling,
IL II were not for the sersibilities of
soma people. but to what we call taking
chances to 9void their censure. SO long
as q building on one side of the street
offers the gambler stocks and grain con-
tracts that he may take chances on. and !
a building on the other side Of the street |
offers him money with which to effect the |
gambling transactions, there Will be an |
abundance Of gamblers ready and anx- |
ious TO avail themselves Of the opportu-
mites offered. The broker sells him the
stocks, or grain contracts. the bank lends
him the money With which to buy, TAX
ing the stocks or grain contracts as col
lateral security. and all the gambler has
70 do IS TO furnish the necessary mar
gin"-that is, enough cash money when
added 10 the stocks or grain contracts 10
insure the bank against loss. With the
exchange right at hand. where the thing
bought can be sold again at moments
notice, the margins" required are very
small, so that the whole business IS made
as attractive as possible 20 the gambler
The New York banks then denude the
whole country Of its currency. because
they know they can always find an album
dance Of stock and grain gamblers 70
take 1t from them at profitable rates Of
interest. and the National Bank act in
combining banking to national banks is
the source Of the whole evil
What is the cure?
1t is TO end the intolerable abrldgements
IF the citizens natural right placed on it
by the National Bank act, and allow
every one his natural freedom OF issu-
Ing his negotiable promissory note to
whoever wants it. If this were done
we should have State banks all over the
and where banks we've needed, and they
would issue the negotiable paper neces-
AIRY 10 effect the exchanges in the neigh
'orhood where each was located Then
notes would stay at the home Of their
'arent for the uses Of those intended
o be benefited by them. and, as the
Iew York banks knew nothing Of them.
md did not, therefore, want them. they
would not suck them away from their
roper locality to enable gamblers to
t large without media Of exchange.
We hear It constantly said that with
rec banking. mushroom banks would
pring up. What a superficial view! What
anks would issue notes in Richmond?
he state Bank. one Of our very strongest
Institutions. would do so at once. The
irst National, the Planters National and
he National Bank OF Virginia and the
Ierchants' National would be compelled
{ once to change into State banks or the
tate Bank would have great advan- {
lge over them. The present national
anks then would at once become State {
anks, and these would be the institu- l
ons that would issue notes. Would I
icy become any less solvent and reliable S
ecause they changed to a charter under {
tate law? Would the notes they put {
ut be less valuable and less liable 10 be l
sdeemed than the certified checks which I
icy now issue? The proposition is pre- /
as any man must see who al b
'ws his mind free liberty of thought. t
he whole result Of making banking free S
ould be conversion of the present ma Il
onal banks into State banks, with new $
anks in all those parts OF the State
here there is capital enough to start
bank and business enough 10 need u
inking accommodations. The cure Of =
II evils is in the repeal Of the Sherman Il
liver law and the repeal Of the 10 per. q"
mt. tax on the issues of State hanks !"