Birmingham age-herald., 1894-12-07

beyond the application of the 5 per cent fund. The law has proved eminently suc- cessful and satisfactory in Canada. In the light of these facts no one can dispute the safety ofsthe plan. -fftsef
 The ceposits in national banks are to lHeii capital and surplus as S2, ,255 ,000, 900 to S1 ,002 ,000, ,000. The deposits are more than double the capital and surplus com bined, which means that more than two- thirds of the banking business is done upon deposits, and less than one-third upon the money Of the stockholder. The national banks, with over 300, ,OO0 stock holders, far from being monopolies, are great co-operative institutions, both as to ownership of stock and deposits. The bor- rowing season of one industry is offset by the surplus season of another. The extra demand from one section, while marketing ls particular staple, IS supplied from the surplus money of another section, whose crop has been moved or whose special money wants have been supplied. This keeps money moving to and from our dis tributing money centers. With our pres ent intiexible currency system, there is no alternative. Under the proposed law the banks ofIc cality could increase their note issue whenever the demand for money is active, and when the demand ceases such currency would naturally flow back to the banks vaults, awaiting renewed demand. This would in measure save the expense of transporting money to and from money centers and would tend to prevent the con- gestion of money in our large cities, with abnormaly low rates and tendency to speculation; and, on the other hand, 1t would tend to reduce the high rates for money in rural localities. An elastic cur rency is indispensable in time of panic. The only elasticity of our present currency system consists in the auxiliary credits.
 As to the objection that banks would be organized in remote places solely for the purpose of issuing circulation-remembe that all circulation is issued by the comp troller, who would enforce wholesome re- strietions. All provisions of the national bank act as to payment of capital in cash, verified reports and expert examinations would still apply. The comptroller has power to withhold charter if the charac- ter oi the incorpOrators, the locality or any good reason convinces him that good bank ing is not the purpose of the organization.
 It is recognized duty of the govern meut to supply it's citizens with money which possesses debt paying power, which when rendered by a debtor to a creditor must be accepted as eXtnguishing the debt. The constitution reserves to congress the sole power to coin money and to regulate the value thereof and with the coining of gold and silver, think, the governments money function should end. Our own ex- perence and the experience of other na- lions prove the wisdom of leaving the issue of auxiliary currency, paper money which does not possess legal te nder quality, under proper regulations, to the banks. Our goverment's credit would not then be measured by it's gold reserve. The national bank note exemplifies the true principle of paper money, and, relieved from the un- reasonble restrictions and given the elastic ity embodied in the safety fund principle, l believe it will prove boon to our com- mercial interests and relieve us from vex- atious and injurious currency agitation.