The farmers' union. (Memphis, Mo.) 1891-1895, 1893-11-30

management might BRING 10 them.
They were not slow in discovering
that by reason of this issue Of non
interest bearing treasury notes the
government had invaded their special
privilege, that OF furnishing cur
rency to the people and consequently
had borrowed that much money from
the people without interest instead of
borrowing the same from the banks
and paying them interest. This act
established a bad precedent in their
opinion, and took from them the
profit arising from SO much interest
How to circumvs snt this action on the
part Of the government, and not
patrist,sm, as has since been claimed
was the motive for the establishment
Of what is known "a the associated
banks. The capitals Of the banks
thus associated made an aggregate of
$l2O, 10O,O 900, a sum greater than the
banks of England and the banks Of
France combined, each of which had
been found sufficient for the struggle
of these great powers in their many
conflicts with other nations. Yet,
with all this strength, the banks with
held their support from the govern
ment. Modern writer's would have
us understand that it WIS fear of
disaste. to the government that caused
them to unite nd come forward with
Il proposition to aid, but it was not,
1t vas this issue Of demand notes, the
cloud no larger than mans haad
that scared them into it, for the
reason that they saw cle:rly if they
did not unite and help the govern
ment the government would deal
directly with the people and ignore
their interests altogether Secretary
Chase was reqnes:ed by the associated
banks to suspend the sub-treasury
act in respect Of these transactions,
and, following the course Of COM
mercial business, drew checks upon
some one bank in each city repre-
sentiny the association, in small suma
as required in dishursing the money
thus advanced By this means his
checks would serve the purpose of a
circulating medium continually re-
deemed. This he refused to do. A
limited amount of demand notes had
been issued but the government
treasury WAS empty OF coin, and the
only means of obtaining coin was
through loans. The banks realized
that these loans would take the coin
from their vaults if the Secretary
PERSISTED in demanding money in
stead of the banks promising to pay.
Accordingly they urged the Secretary
not to issue any more demand notes
until all other expedicnts hal been
tried. The banks assumed that. as
the ordinary business operations OF
the general public did not tend t.
withdraw coin from their vaults. il
the government would pursue {:
similar course there would be no uss
of disturbing the coin where it wa.
then, and in tlls manner the wal
might be carried o. bv the use oI
their paper currency. In the mean
time the government would continue
to pay them interest on money it ha,
never received and the banks Obtain
interest on loans they had nevel
made. The following statement i:
from the Bankers Magazine, Jauuar,
1876:
After taking the third amount o
$50, 900, 900 by the associated banks
those in New York that had at tina
time paid ia their proportion (ove
$50, 900, ,0OW Of the governmen loan
found themselves in this position:
Their aggregate coin on the
18th of August. before the
first installment Was made
amount .............S49. .3j. .99'
On December .......... 42.3lS.G .Gl'
\ reduction of only :. 1857,
/ This was after paying out ove
$4,000, 900, showing how quickl,
the money returned to the bank
through the different channels 0