Bismarck weekly tribune. [volume] (Bismarck, Dakota [N.D.]) 1884-1943, 1893-07-21

~ssAN - "a oAApAOl klC0t I0l III
was done to the town before that. Bis
marck ought to have been the end Of the
divisions: it ought to have had the shops.
Ihat was the agreement when the town
J site compromise was made.
CAUSE OF PRESENT FINANCIAL DE-
PRESTON.
The causes of the existing financial
depression, says Rhodes Journal of
Banking, are not far to seek. They are
to be found chiefly in the unwise fnan-
cial legislation OF the last twenty years,
and in the anomalous attitude of the
people of the United States towards
their banks. The financial legislation of
the last twenty years has been hetero-
genous and contradictory. 1t is a series
tf compromises between the desire to
maintain an honest standard and the de.
sire to secure the votes of multitudes
mlsled by financial ideas.
The best that can be said of these meas
ures,-the Bland Act of 1873, and the
Sherman Purchase law of 1890, is that
they are necessary in a political sense
to maintain the gold standard. They
have no doubt up to this time secured
their object, although their continuance
jeopardizes the longer maintenance of
the standard gold dollar. The credit Of
the United States has been able to sus-
tain itself notwithstanding these unwise
laws, but the reduction of the 100000
600 gold reserve, and the continued
trenching upon it have shaken that
credit. No matter how rich a man may
be, a continuance Of foolish management
must destroy his credit. The forced pur-
chase of silver, with notes payable in
gold, is a piece of idiocy, patent to all
nations, on the part of a nation ostensi-
bly, seeking to maintain a gold standard.
The second cause 10 the anomalous
condition of the banks Of the United
States-unable to issue notes without
making deposits of costly bonds, they
are deprived of the use, in time of need,
of the credit they have secured. In
times of prosperity or absence of alarm
the surplus money is not redeemed by
the government which issues it, and it
accumulates in the banks at the fnan-
cial certers. These banks hold the re-.
serves Of the whole country, and when
the people who have deposited the
money are alarmed, they begin to with.
draw. How the feeling of alarm on the
part of depositors commences and cul-
inmates is too metaphysical a subject
for our consideration, but in the present
instance it arose from the very intimate
relations existing between the treasury
department and the commercial inter-
ests, 80 that when it was plainly. seer
that the treasury might be brought into
difficulties by the diminution of it's gold
reserves, every depositors caught the
alarm in a greater or less degree. Here
entered in another element, which did
not exist in former years, viz, the great
development of the safe deposit bust
ness. In former panics, when the de-
positor drew his money from a bank, he
either had to deposit it with some other
bank or hide or bury it. The safe de.
post vault now takes away the last IN.
ducement that might impel a deposition
to leave his money. The money was
drawn by local depositors, and the coun-
try banks, to make good their reserves,
were obliged to call on their city CORE.
spondents. The latter, finding their
funds thus reduced, were no longer able
to take care of their country correspon.
dents that needed help. It was all they
could do to meet the demands of those
who demanded their balances. There
was thus q gradual squeeze, where the
weak banks unable to get help had to
go to the wall.
i This squeeze will continue, but with
each bank that is compelled to drop out,
the remainder will grow stronger. More
over the money deposited in safe deposit
vaults all over the country and the large
stocks withdrawn from the money cen.
tres and held at home by the country
banks will soon begin to move as it can
find safe Investments. The main cause
of the difficulty is, however, the appre.
henslon that the United States treasury,
upon the credit of which the value of
almost all the money in circulation de-
ponds, is in danger of being seriously
embarrassed by the continued issue of
gold notes for the purchase Of silver.
Remove this cause, and restore the
shaken treasury credit, and an improve
ment will at once be manifest. But te
prevent the recurrence of these unfor-
tunate difficulties a still more radical
reform is necessary. The note-issuing
function should be taken from the treas
ury and restored to the banks, so that
the business of the country need no
longer be dependent on the government.
IT seems that after all of Governor
: Tillman's hard work in getting the new