The Pioche weekly record. [volume] (Pioche, Nev.) 1877-1900, 1896-06-04
AGAINST COMPETITION.

ellNGT IOE IuC EC1SOA lndL I'LL men
object to competition in their business.
At present the government furnishes
the people with about one-third the
money necessary to transact the busi-
ness of the country, and the banks
furnish the other two-thirds with their
credit system. The matter of banks
loaning their credits, and the evil re-
suits from it are generally understood.
As is shown by the coinage laws and
appendix of 1894, we find that on a
certain day in 1883 in banks of all
kinds the following
deposits. $50
Loans. 4759s62 495
Total Of all kinds Of money in cir
eulation .......................... 1896 o7Ol,25
The above proves we cannot take
bank deposits as evidence of the amount
Of money tkere IL - tb .. untrv
When we state that banks loan their
credit we are told that they loan their
deposits, and that banks separately and
as whole have more deposits than
loans, which is true; but bank deposits
are one-third money and two-thirds in
debtedness and there is three times as
much money subject to check and due
on certificates of deposits as there is
money in the country. The method of
iepositing Indebtedness in banks is
very simple. A farmer or merchant
mas 81, 100 in bankable notes; he sells
them to bank for $1,000 Not wish
ng to use the money at that time he
caves it in the bank. Now this man
lid not take any money TO or from the
bank, in fact there was no money used
n the transaction. Still the bank
books show $1,000 more in deposits and
II, 100 more in loans. One thing is
very apparent; if all deposits were like
the one referred to, banks could not
make any cash purchases of notes
with deposits.
BY the above figures we find the
banks are loaning SO, 1T, 900, 900 more
money than there is in the country,
and that is counting that all of the
money in the country is in the banks,
and that no money has been lost or de-
siroyed which is not the case. If the
volume OF money was sufficient to
transact the business of the country
w9 would not need banks. The bank
era do not want the government to
tdrlish the people with a safe place to
Gs gosit and the necessary amount of
money. They contend the present
amount of money, 81, 500, 70t, PAS, is all
. the Government should issue, and they
VIII Furnish the balance, So, 1T, 900, 900,
with their credit system, and throw in
the ranics, If the loaniug of deposits
W. 1rohibited we would not have
u: ice, and we would not have to pay
.1j. .0o0 of interest annually to
i'>ahars for the use of their credit.
'aahs on their credits alone every
al years are collecting in interest
&. zc7an per cent. sum equal to the
VIA amount of money in circulation,
gtt tina, only represents two-thirds of
to.ai amount of interest they col
l;-t
W. "isD tni by the coinage laws
a.-i apPendix of 1894 the following:
..st2l national banks ............ s0sl so 900
.-ait3} al her .............. 406O07 900
taaJ astw2cn May and December
70, !H3' tae national banks in
s.e-sel thcir cash reserve .."..... 9l40) 900
.9t in ep0sits..........,........... 100000
o.. ''rEet5d saCtr loans ,....,... 2O9S)OOOO
aatuaajing all other banks in pro-
pug'ioa to their capital, at the same
ratio The total amounts for all banks
decrease their cash reserve. Al, ,O)O
Lost IN deposits ts,...,..........,..,...2 2i05ioo00
EJatracted their loans ............ 129,33l,O10
The banks did not contract their
loans, S429, 600 600, in six months during
1898 because they did not want the in
terest, or because they were afraid they
would be paid with 50-cent silver dol
lars, for they were owing their deposit
tors more than was due them on loans,
and any money paid on loans could be
forced upon their depositors. The con-
traction was to protect banking sys-
tenn based on credits and confidence.
The banks controlling the credits and
the people the confidence.
1t should be borne in mind that
banks are natural allies of all monop-
olies and that stockholders in banks
are often stockholders in other corpor-
ations, trusts, railroads, etc, and they
get accommodations when others can
not.
In times of business depression the
price of merchandise, produce and la Dor
decline, and interest should do the
same, but by the use of bank credit we
have an elastic currency which enables
banks to maintain high and uniform
rate of interest. As is shown by bank
loans, it required nearly SIS, 900, OoO OoC
to transact the business of the country
in 1898 and about two-thirds of the
amount was supplied by bank credit
If the volume of business should fal
below one-third of what il was in 1898
the rate of interest will decline as there
will be dual money seeking invest
ment, but the rate of interest will no
decline as long as there is any banl
credit in use as the supply will jus
equal the demand A failure in Phila
delphia may start the Kansas farme
to market with his stock, or cause tn
merchant in Michigan to fail for tn
want of a small loan. In the scrambl
that follows each scare, merchandise
produce and labor are thrown on tn
market for what they will bring.
Banks have much to lose by panics
and try to prevent them by assistin
each other, but they will not give u
their system of loaning credits on whic
they collect $500, 900, 900 of interest ar
nually, as it is the greatest scheme o
earth to get something for nothing
and on which they even object to pa
an income tax. This system of ban
credit and deposits is the cause c
panics, and is the endless chain tha
closes the factory door, stops publi
and private improvement, opens tn
granary door and leads the live stoc
TO market By the custom of peopl
depositing money in banks, the banl
hold a large part of the money of tn
country in their vaults which can |
used to raid the United States treasur
OF its gold, and at the same time the