Goldsboro weekly argus. [volume] (Goldsboro, N.C.) 1885-1909, 1894-04-19
THE BANKING PROBLEM.

| Racket StOre-B. COhen & 60.
THE BANKING PROBLEM.
AS the United States hscestor
says, there is no doubt that the
u. S. will have to face in earn
est in the near future the prob
lem Of providing new currency.
The opinion has been expressed
in the hecestor that the present
IS not an opportune time to force
the issue to conclusion. and
this we are Informed is the view
of President Cleveland. but this
should not debar it's careful con-
sideration. Discussion and com
parisOn Of views as to the best
system will enable Congress to
legislate with greater Intelligence
and wisdom than if the issue
were suddenly brought to a head
without previous consideration.
! The feeling is growing among
bankers and economic students
who have gotten rid of the old
mercantile theories Of currency
that the issue Of bank notes. un-
der proper guarantees Of secur-
ity and with provision for
prompt redemption, is the best
and most scientific method of
meeting the demands of
modern business. The idea
has been exploded that issues of
wellsecured paper are the cause
of speculation and over -produc-
: ton. They are sometimes the
consequence o. expanded credit,
; but they are not the cause Of it.
and the volume of bank notes at
any time outstanding is a mere
drop in the bucket to the volume
J Of checks, notes and bank dis
counts. The excess of such paper
is the cause of commercial crisis.
J but it is not within the power of
: the government to restrain it.
} Bank notes redeemable in gold
: on demand simply furnish a con
} venient method Of making use OF
capital. They are little more
: than checks payable to
? bearer, except that they are
more negotiable from their form
| and the guarantee of their secur-
ity. There is greater need fo1
bank notes where banking in its
l proper sense is least developed
than where checks and drafts
: form the bulk of the medium OF
} exchange, This is the reason
7 why the South is constantly
7 clamoring for money and why a
t proper banking system would
I meet the difficulty. If the planter
7 could borrow money on his grow
, ing crop from his local bank and
2 get it in the form Of circJlat-
ing notes which could be put in
} circulation through his laborers,
l the South would enjoy a great
I access of prosperity and the
1 clamor for free silver would
cease.
The prejudice against the old
: state banks was much exagger-
e ated by the financial crisis OF
: 1857 and the general suspension
= of specie payments, but neither
T the national banking system no1
any other policy or system yet
devised by the wit of man has
; been sufficient to prevent com
2; mercial crisis. which result from
the abuse Of credit. The coun-
try will insist, in view of the
close-knit business relations o1
all it's parts, that any banking
currency hereafter issued shall
be perfectly secure, uniform i'll
character and redeemable in colo
0 on demand. This might be Sc
cured by suspending the ten pei
cent tax on state banks whe1
they complied with certain spe
cific conditions and were amena
BILE to the supervision Of the
e comptroller Of the currency. The
moment any bank, whether hold
ing a state or national charter
: should violate the conditions Of
the Federal law, the 10 per cent
: tax would bring it to a sudden
y halt.
Any new system which might
be devised to supply a scientific
: and elastic currency to the coun
, try should be so framed as to
i permit an easy transition for the
: national banks into the new sys
: tenn or preserve their equal priv
; ileges until the expiration OF
! their charters Any system
!, which should give an undue ad
vantage to the new banks ano
drive the OLD ones to the wal
7 would result in embarrassment
l and disaster which would bring {
new financial crisis. The coun
: try needs a banking currency
however, and it is none too early
d to begin to consider the means O.
: providing it.
S FOR, RENT