The courier. (Lincoln, Neb.) 1894-1903, 1896-02-22
Written for the Courier.

uuouCboi p1OOscuse euu oh tnes ~
taine thereto have been uppermost in
the public mind since the so-casled
panic or crisis OF 1893. Various expe
dents have been devised for the svow-
cd purpose Of ameliorating the con-
ditions surrounding our industrial and
commercial interests; but We seem to be
- far from the promised land % ever;
at least % Tar a. legislative relief is
concern ed The brilliant success Of the
last bond sale will certainly stimulate
confidence, and will possibly direct pub
lie attention to the shortcomings OF our
financial system.
A great deal is said about circulation.
the per capita rate. generally stated at
about e23 and silver advocates are
specially industrious in discussing this
aspect OF the situation. The report OF
the comptroller Of the currency, just
issued from the government printing
Office, contains some interesting facts
from which fair analysis Of the cir
culation, so-called. can be made. The
total amount OF United States money 10
existence 1885, was s2,396 6O7. 420; OF
this an cunt the Treasury held e796.
638, 947 making the total outstanding
circulation ei6Ol ,93s. Alb or s2293 per
capita. Although these figures comprise
all the money Of every description,
little reflection will convince most any
one that they do not represent the true
circulation ut ALL
In the first place the law requires
national banks to hold a cash reserve
equal to a certain percentage Of their
deposits. and all other banking insti-
buttons are by the exigencies OF business
subject 10 practically the same require
ments though not stated in express
terms. The amount held in this way
by the 9,606 banks was e63l, Ill go
nearly two-fifths Of the amount out
standing The whole superstructure Of
the banking interests rests upon this re-
serve. and it is as efectually withdrawn
from circulation rs the money locked in
the vaults Of the Treasury department.
In this connection il is noted that the
banks aggregate deposits Of the savings
amounted to 81. IA, Isl, 79S, over 100000
600 more than the amount Of money
outside Of the treasury vaults.
1t is well known that most business
transactions are settled by check. but
the function Of the check as an ecouom
ical factor may not be 90 universally
recognized eince it is payable only in
money. In the settlement Of accounts
between banks. checks Offset each other.
% that only the balances are paid in
money The records Of the New York
clearing house show that since 1854 the
balances settled in cash have not ex
ceeded 6 7-1O per cent OF the aggregate
transactions. and the rate is frequently
- low ~ 3 per cent. The New York
clearings for 1895 were e28 264 ,379. l26.
The deposits OF the New York banks
amounted to sl97. $4,000 on October g,
1896, and the cash reserve held by the
same banks was e'23,967. 900. The
clear;ngs for the same week were e64l,-
6atOoe or over sl0o.0oo.OOO per day. In
other words il the checks did not neut-
ralize each other but were actually col
lscted instead Of being deposited, one
day's transactions would nearly exhaust
the reserve Of al Of the banks. and five
days transactions would about wipe
osnf Ill a fhA danoaifa shoUin0 that