Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1894-11-30
The Baltimore System of Banking.

In the Trans Mississippi Conference at
st. Louis a resolution was introduced on
Tuesday deprecating the adoption of the
banking system known as "the Balti-
more system"
This Baltimore system has attracted
much attention and been received with
much favor by many of the bankers
and other financiers of the country. The
fact that the silverites in their conven-
ton in St Louis deemed it important
enough to be made the subject OF a spe-
cial resolution is an indication that that
system may have in 1T what an Irish IL
nancier would style "the making OF
good banking system. We take II for
granted, too. that this Baltimore system
will without delay be attacked In both
houses of Congress. The advocates OF
a State banking system and the advo-
Gates of the entire control Of the cur
rency by Congress. will unite with others
in trying TO destroy the Baltimore sys-
tenn at once. That system Is strong,
but may not be strong enough TO with
stand the combined forces which Will
be brought against it. Its strength lies
in the fact that the existing national
banking system cannot long be Kept up.
because there will soon be no United
States bonds TO deposit at Washington
as security for the circulating notes of
the national banks. The Baltimore sys-
TEN provides that no deposit of bonds
shall be made to secure circulating notes.
But there will be substitute found
for the requirement that bonds shall be
deposited TO secure circulation. This is
a most important feature OF the Balu-
more system. Inc proposed section
reads as follows:
Section 6. Create a guarantee fund"
through the deposit by each bank of
2 per centum upon the amount OF circu-
lation received the first year. There
after impose "a tax OF one half OF 1 per
centum upon the average amount or
outstanding circulation, the same TO be
paid into this fund until il shall equal
per centum OF the entire circulation
outstanding. when the collection OF such
tax shall be suspended, TO be resumed
whenever the Comptroller OF the Cur
reGcy shall deem at necessary. The
notes OF insolvent banks shall be re-
deemed by the Treasurer OF the United
States out OF the guarantee fund. II it
shall be sufficient. and IL not sufficient,
then out of any money In the Treasury,
the same to be reimbursed TO the Urea
sury out OF the guarantee fund" when
replenished either from the assets OF the
failed banks or from the tax aforesaid.
National bank associations, organized az
ter this plan shall have gone into opera
ton. may receive circulation from the
Comptroller of the Currency upon pay
ing into the guarantee fund" a sum
bearing the ratio 10 the circulation APP
piled for and allowed. that the guar
antee fund bears to the total circula-
ton outstanding, and 10 be subject TO the
tax OF one half OF per centum per an
nam. as called for by the Treasurer OF
the United States for the creation and
maintenance of this fund No associa-
ton or Individual shall have any claim
upon any part Of the money In said
guarantee fund" except for the redemp-
ton OF the circulating notes OF any in
solvent national banking association.
Any surplus or residue OF said "guaran-
tee fund" which may be hereafter as
certained or determined by law. shall
inure to the benefit OF the United States.
IL the above section shall prove ac-
ceptable TO the bankers ana would be
bankers and the public generally. all
the other features OF the Baltimore sys-
tenn may DO so amended 40 to be accepta-
BILE also.