New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-10-12

The notes Of insovent banks shall be redeemed by
the Treasurer of the United States of the guar
| sufficient then out Of money in the Treasury
/ the same TO be reimbursed to the Treasury OF
the guarantee fund' when repenished either from
the assets OF the failed banks from the afore
National banking associations organized after this
pan shall have gone INTO operation may receive cir
,ain into bo f cd e I[enrY ui b
! ratio 10 the circulation applied for and allowed that
outstanding. and be subject TO the tax OF u Of
Per cent, as called for by the Treasurer of the
United states for the creation and maintenance Of
No association or individual shall have any calm
upon any part Of the money in said guarantee
fund" except for the redemption Of the circulating
n MY & o rssi9 f, oil sam arr anna
MGh may be hereafter asce6saHed or &
s}at ,@W S'a'' '"''s 20 the 0e"ei' OF the "ea
Sec ! The Government shall have a. prior lien
Liability Of Shareholders for the purpose Of restoring
the amount Withdrawn from the guarantee fund"
for the redemption Of Its circulation not to exceed.
however. the amount of the failed banks outstani
Ing circulation after deducting the sum TO lis credit
in the redemption fund" (Section A. already in the
hands Of the Treasurer Of the United States
Sec Circulation can b. retired by bank at
any time upon depositing with the Treasurer OF the
h n sum S to Be aTh and IN T upon
such deposit the tax indicated in Sections 2 and
Sec 8 In the event OF the winding up Of the
business OF bank by reason Of Insolvency or
the concurrence of the Controller OF the Currency
may on the application OF the drest9rs or OF d the
ciai and upon being satisfied that proper arrange
noes Of the bank and any tax due thereon pay
over to such directors quidator assignee receiver
or Other proper oficia; the amount at The credit
OF the bank IN the redemption fund indicated in
Section T.
NOT A COMPLETE AMENDMENT.
We do not offer this plan competed amend
ment to the present law. but simply as the out
line OF desirable legislation. embodying the under
lying principles necessary in judgment for the
creation OF a safe and elastic currency. 1t is not
our intention to disturb the existing modest bank
i Sea Ge ds an9 bc 10 banks t To con
time the same for the present our curr.h.y mus
be supplied by the banks. not by the government
The latter notes only the condition OF trade by
the rise fall OF it's revenue receipts. n" hanhS
are the arteries OF commerce. feeling instantly the
change OF commercial. activity and ultimately &C
Quainted with its volume and requirements, ~
chatterng r Of the srain.bin in the West The
grinding noise OF the steam shovel IN Mesaba' are
financial centres OF the country. Hence our money
panse activity able supply its fullest
wants and contracting again as the siain OF com
rencv RESPONSIVE 10 the demands OF commerce can
never be obtained 80 long the institution L.
suing the Is required In advance TO invest as
as the crcu:ation which is allowed to issue upon
the same amounts to- TO he , sasi isi1in the
same must have for It's sponsor the necessary COY
BY allowing the banks TO issue clI cuauon 10 rn9
extent OF % per cent OF Their paI-u: t,I, r
The history Of the State banks Of country fur
position The first bank Of the United States. which
a well the second was allowed - issue clrcu,
in 1909 upon .l6000c capital t00co circulation. OF
e per cent in S Spos aea nG BaGs 5 H.
States in 1885. with capital Of $500 hal ONT
per cent In the writings OF Albert GAnatin; vol
g. page a2 we IND speaking Tor the year H., ' 5
banks the statements we have given sh0"
that the average amounts OF notes ISSUED by the
State banks do not taken together. exceed ~ per
cent Of Their cspita Ihe Tepor, mace - e. s
condition OF all the banks upon January J. -,
5 5aG~ a Ina} ee 4, iao Win Total cfcaton
OF sls3 i762ls being exactly - per cent OF the cap-
that Massachuset;s had t5i $500 bank capital WIN
so S3s 90 circulation or . g., per cent, ana LOUIS,
70 $40 per cent The laws Of MASSACHUSETTS, per
mited circulation to double the amount OF The cap-
tai while no linn. whatever VAS placer upon c.fcu-
laton in louisiana
PROVISION FOR EXTRAORDINARY REQUIRE
MENTs.
To provide. however. for very extraordinary cur
rcncy demands. such confronted us al. In NJ
We propose t. permit the issue OF an addtona! p
per cent to De known 5 emergency circulation
subject to a severe tax This tax. large as 10 de-
prive circulation Of profit should provide safe
guard against constant expansion, and would caus"
the prompt retirement OF circulation as soon "a n"
urgent necessity for It's issue ceased Its mission
would be similar. hut OF broader utility, 10 that ~
clearing certificates which performed such ef
fective service last year. and by whose use i'm
measurable losses and ruin were avcrtci. The tax
must be markedly severe otherwise the banks IN
times Of panic would ind themselves In helpless /
condition, having already exhausted me reserve /
forces supposed TO have been provided Tor sucn |
The redemption Of all notes should be made by /
the Government. go that the note holder "oui nor
biii that he might ho.d nor be at a loss as to the
place OF It's redemption nor the certainty thereof
a. sgseesed by u.s. Is moTe tnan ampe to pT9 9ro
any moss lc y
pared by our friend the Hon. \. y. Hepburn dur /
NJ bonds at ali as security for circulation, the |
total loss to this fund since the organization Of ne
National bank system would have been only ss5Spp.
TIE guarantee fund principle Is not a new one.
NewYork adopted 1t in 1879. bu, BY an error or ac-
cident in framing the law was made TO cover the
deposits as well ae TIE Circulation Each bank wa,
had accumulated. In 1888 Willard Fillmore. then |
contributions TO this fund had been Ss6 81 ana ne
notes Of failed banks amounted TO only N5is5'3;
x27.j05. As Horace White very APPLY says in an ad-
dress delivered before the American Academ !!,, Of
Is perhaps The most pregnant fact in the history OF
our currency must be National; It's credit equally
good North South. East ana West Commerce
dare not halt upon the boundary Of any STATE,
tinid to her rights hesatng as 70 her reception
In closing desire 70 exEess my thanks for your
patient attention. and. in passing this subject into
upon you the retention and adoption Of the Ma
tonal bank system with the proposed amendnents
than the following language OF our 'rleni, Horace
White whom all esteem highly:
1.-THE public have confidence In the RIA l.
chinery Of Governmental oversight and enforcement
Of law under the National system than they nave
under State systems, and this they viii continrc
20 have. though some State systems are AS @Jpd |
or better. They know that the National system Is
uniform. II operates in the same way n Washing
ton CITY and Washington State. ana tVtrywher"
between. When you know this law and the decisions
under IL, you knON all that IS necessary If you
undertake to learn and keep track Of the banking
laws Of fory-foIr States and four Territories YOU
Will find your task heavy one. There Is now
movement on foot secure uniformity OF Jaw In
the States touching the marriage relations, Wills
conveyances Of land and some other things. AS We
actually have uniformity Of law the subject OF
banking, had best keep It,
A. Il. HEPBURNS ADDRESS.