The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1893-06-28
THE BANKING BUSINESS.
1t Has Seen Many Changes in Re.
cent Years.
There Is Now No Room for the Small
Depositor--The Crime of Attempting
to Mix Straisht-Banking with
specuiation-A Great Need.
{copYRreHr. 1898

COPYRIGHT 1893
The business of banking has in re-
cent years, changed its form, in that
deposits have become the ambition Of
the banking officers. To procure more
deposits than enough, bank presidents
and cashiers have been invading each
others domain and inveigling well-to-
do depositOrs to leave one bank and try
another one. Thus, the banks got to
beratad, not by their inherent strength,
but fcr what their vaults contained be-
longing 10 other people. Men who
could keep up good deposit line had
all their business transacted free. This
insecurity was finally discerned by the
dspositors, and they have within the
past fsw months reduced their deposit
accounts, and the banks feel the di-
n1inution and must needs show it in
their reports Cases have been known
where banks, formerly of minor stand
ing. and with very small amount of
capital, hawe carried twenty millions
of deposits, and in some cases their
capital was Eotmore than one hundred
or two hundred Thousand dollars. Mr..
Hepburn told me last winter that
several OF the banks were attempting
to rednce their capital, SO that
they need not pay their earnings
to SO many stockholders, and mean
time they were thriving upon this
inundation of deposits. The effect was
to make the small depositor rather a
nuisance In bank The honest man
who did moi speculate, and could keep
to his-credft q few hundred or thou.
sand-doItars, WIS looked at upon the
wfole asAca1mberer of the bank, while
the jobher I'm speculative securities,
w1psappesxed with Ids fifty thousand
to two hundred thousand dollars, was
a man whom dozen banks were
angling for.
Thusfhe present situation may have
Its benefits. Banks were originally
nn2derno& to be dumping grounds for.
dsposfAsshut agencies u9 discount and
OF 1oan Animmeuse amount of money
10 constantly 1entdn New York on call,
the rate fuctuaffng absurdly; some
times the rate is but four per cent. a
year and at other times il is four per
cenk a month or week. Notwith-
standing tfasupezzision exercised by
the government over the national
banks . good many of them have been
cangfn In the tsmptation to do a
strained banking business, and the
hstof failed national banks is large
enough to give some cou,tort to those
who want us to blot out the progress
we hsve made since 1868 and return to.
state banking system, where the
supervision over banking viii be in
the hands of state politicians who
haunt the state Legislatures and bring
out the vote of cities
Meautime our national politics is
suffering from the want of any high
spirited. patriotic, general undertake
ing, such rs we had in raising money
TO sustain the war and in restoring
specie payments. In place of some
general plan or purpose congress di-
vides It's aims among q parcel Of local
improvements, the renovation of rivers
and harbors, the construction of post
Offices and, of course, the catering to
the constituencies, instead of holding
the constituencies to the support of
the government. The tampering with
the soldier vote, which was at one time
the balance of power, led to the great
est aggregate extravaganza at Wash
ington, and finally the merchants and
Taxpayers became frightened. They
saw the annual appropriations rising
from three or four hundred million
dollars up to billion dollars per con-
gress. Inevitably such appropriations
went to the political element in part.
Either commissions were received by
congress and it's satellites, or the mem
bers obtained an additional impor-
lance by the huge sums of money they
were able to omnibus and draw out of
the public treasury. Our surpluses be
gan to be deficiencies. About that time
the tariff was attacked as the in
strumentality which was doing the
havoc. Since Mr.. SCleveland's re-
election he has diverted por-
ton of /. his concern from revising
the tariff to revising the silver legisla-
ton, but the sequel is uncertain. He
has merely his patronage to play
against the tendency of congress to
continue the coinage of silver or some
other form of currency imitation. This
patronage does not amount to much,
compared to the outlay upon the
heterodox lines ] have named. A
much better offset to the cussedness OF
congress would be to arouse public
opinion to the true situation.
It is determined, perhaps, to pre-
sent to those who will not alter their
silver legislation a scheme OF state
banking, whereby, according to the
laws of the different states, we shall
have such banking as Illuminated by
its incendiary fires the panic OF 1887,
and again that Of 1857. All the state
banks went by the board in 1887, with
one or two exceptions, and the panic
OF 1897 was brought on by the failure
of the Ohio Life and Trust company,
where we first begin to hear IF the
ominous word Trust Trust com
panies are also feature of the present
time. In every city they are to be
found, volunteering to take charge o,
collections and estates. They have
erected rrAaf va,1lts irayos;no. f,or4s