The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-01-09
THE BENEFITS OF BANKS.

The discussion of a currency or more
properly, a banking bill in the House
excites the demagogues ip that body
and elsewhere to repeat their stale de-
nunciations of Wall street and bankers
as if they are one and all hostile to the
people. 1t is pure demagogy, and it
seems impossible that those who resort
to it do not know that such attacks are
a miserable device to prejudice the peo-
pie against those who now, in every
place having a thousand inhabitants,
make a business of collecting the money
held and unused by individuals, SO that
1T can he made available for the larger
business of communities. If the dema-
gogues who make such talk in Congress
and at the street corner and exploit it
in the newspapers imagine that the peo-
pie believe their wretched drivel about
national banks, grasping money lend
ers and money sharks they are mistaken.
The people for the most part have
learned better. Every quarter the thou
sands of pensioners who get their pen
sion checks cashed without charge by
Indianapolis banks. while others who
denounce banks charge them 25 cents,
have learned that bankers and banks
are most considerable of their con-
venience.
AS matter of fact. the bank and the
banker have provided the chief agency
for the cheapening of rates of interest
and for economizing the use of real
money. The greater part of the money
which is loaned upon mortgages comes
from the savings and life insurance in
situations, which in turn have received
their funds in trust for the hundreds of
thousands saving small sums from their
earnings. We were once taught by the
demagogue to believe that the money
so invested belongs to the millionaire.
but we have now learned better. But it
is in econornizng the use of money and
in the vast expansion of production and
traffic which such economizing makes
possible that the usefulness of the sys-
tenn of organized banks is demonstrated.
More than 92 per cent. of all the larger
business transactions of this country
are settled by the use of bank paper.
The movement of merchandise, exports
and imports of the United States, Great
Britain France and British India from
1886 to 1890 aggregated $50. 204, 527, 1856, but
the movement of specie necessary to
effect those exchanges was only s2,717,-
334, 1913, or 7ih per cent. of the value of
the merchandise exchanged Eleven
other countries bought and sold mer-
chandise to nearly the same value dur
ing the same period, using only $780,
900, 900 of specie in the transactions, or
go per cent. That is. only $3.50 in cash
were used TO buy and sell 500. worth
of merchandise. To further show the
increasing power of. banks to economic
the use of money it can be stated as a
fact that it took IL per cent. of the
value of the merchandise in specie to
effect the buying and selling from 1860
to 1854, against ~ per cent. between the
same countries in 1S86-9O. 1t would be
impossible to transact the present vol
ume of international trade if II per
cent. of specie instead of ~ per cent
were necessary. This saving Of money
in merchandising is due to the increase
of banking power through organization
among the leading nations.
In view of such facts as these the man
who says in Congress or in Indiana that
the people have no interest in a bill be-
fore Congress which will affect the or
which exchanges are made by the repre-
sentatives of money-that is, drafts,
checks, bills of lading and bills of eX-
change. deserves to be labeled 'igno-
ramuS"