The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1895-01-13
JOBES BEATS JOHN
WICHITA BANKER BEATS THAT
CARLISLE SCHEME

1
Erroneous Ideas Of Large Profits Of the
National Banks Exposed-Gives Fig
ures to Prove His Proposition.
A. c. Jobes Of the Kansas National
bank is the inventor of a new banking
system which will shortly be presented
to western bankers for their inspection.
Mr.. Jobes says that he has only
found time to think over the outlines
but that he will in very short time
have all the minor details of his pro-
posed banking law completed.
Some Wichita men who are consid-
| cred authority in matters relating TO
| finance have examined the outlines of
Mr.. Jobes' system Of banking and pro-
nounce it superior to the Carlisle
scheme. While Carlisle seems to have
sacrificed everything to protect bill
holders Mr.. Jobes' plan looks out more
for depositors.
| Mr.. JObeS' scheme in substance is to
allow banks to issue their own notes
after depositing the necessary securi-
ties with the government to secure cir
culation Then the scheme or proposed
law would allow a combination of all
| western and southern banks. These
banks to establish a central agency,
say in Chicago or st. Louis, into which
each bank in the association would be
required to place a sum equal to per
cent OF its circulation. This fund
would be used in case any Of the banks
in the association failed to protect de-
posirors instead of to redeem the cir
cuiation of the suspended bank.
Mr.: Jobes is of the opinion that in all
the banking laws recommended for
passage in congress there is a fatal
omission in falling to provide for the
security Of depositors. His idea is
that no money should ever be issued
without ample security for its redeElp-
ton and all deposits of currency or
coin should be used solely to protect
depositors. He attributes the present
apparent scarcity OF money TO a lack
of confidence in the banks. People
withdraw their money from the banks
and from channels Of trade where it is
needed because there is feeling that
depositors have no protection.
Under Mr.. Jobes' proposed banking
law the bank examiners would be ap-
pointed by the associated banks. Each
bank having put up sum of money to
secure the depositors in any one of the
banks in the association that might
fail all would be interested in strict
examination. In that case Mr.. JobeS
thinks evry bank would be interested
in making good showing, which could
only be done by keeping entirely away
from all wildcat speculations that are
always liable to wreck a bank.
When asked if bankers generally
favored the Carlisle plan, Mr.. Jobes
said that he did not think they did.
No man who wished to do a safe bank
ing business would want to be liable
for the mistakes of any bank except
LII v,,Ia l,-1a ,1o
one would be interestd in putting up
just as little security as possible for
his circulation, as each bank would be
responsible for all the others. There
are very few reputable merchants
who would want to do business in a |
certain line if they were held response |
BILE for the mistakes of all other men |
in their line of business. 1t is this 1
feature in the Carlisle law that will be |
remedied by the plan proposed by the |
Wichita banker.
Mr.. Jobes said that the idea seemed |
to prevail here in Kansas that the ma |
tional banks make a great profit on /
their circulation. This idea which is /
usually promulgated by Populist ora |
tors is a very great mistake. The fact |
Of the matter is that there is no profit |
in the circulation of national banks |
in the west. He then started an i'm |
aginary bank on a 100000 4 per cent |
United states DOn0 ana SuppOStu
to worth 10 per cent. The gov |
eminent would give 900 in currency |
which the bank would be at liberty to |
circulate The bonds would draw in /
terest at 4 per cent, which would make |
81, 900 a year and the $4,000 at 10 per |
cent would bring in $4,000. These two
sums added make $4,000.
Thirteen thousand dollars interest on
s100 600 would on its face seem TO be
pretty good investment, but there is
another side to this question. 1t was
the other side that Mr.. Jobes proceeded
to present He showed that the $780,
900 4 per cent bond would cost $4,000 |
because the bonds were worth |
premium There are other expenses
that must be met and when Mr.. Jobes
counted them all up he made out a
balance sheet and passed it to the
Eagle representative. These figures
showed that Sl00,0 loaned at 10 per |
cent would be better investment
Here is the statement:
slOo. GOO T. S. As would yield. 1000
$50, 600 cir'n a 10 per cent. 5000
$4,000
Less tax a 1 per cent.......s 800
Sinks fund retire pre- M. ll40
Cost print'g etc 100
Int on 81, 800 G per cent fund $50
Int on $4,000 prem. $4,000. 1900
Int on 100000 being differ
ence between $4,000 circu-
lation and bonds. 1000 1890
Profits on cir'n basis. sS11o
sl13. 600 q 10 per cent with
out the cir feature...-.. 1890