The Hocking sentinel. [volume] (Logan, Ohio) 1871-1906, 1897-12-16
ECKELS MAKES REPORT.
Reviews National Banks and Favors
Amending Note-Issuine, Law.


The annual report of James II. Eckels,
Comptroller of the Currency, for the year
ended Oct. 81, 1897, opens with brief
review of the history of the legislation
which constitutes the present national
bank act, and invites the attention OF
Congress to amendments to the law rec
commended in former reports without spe-
cihcaliy repeating them.
On the subject of bank note circulation
the Comptroller says:
1t is noticeable that In all the changes
which have been wrought In the natlohdl
currency act from Its inception to the pres
ent time the feature subject to criticism,
but which was intended should constitute
the principal benefit to be conferred, mas
remained comparatively unchanged-name-
ly, the note-issulng function. Whatever JUS
tification there was in the first instance Tor
restricting the issuing of notes against the
bonds of the Government, deposited wen
the Treasurer of the United States, 10 w
per cent of the par value thereof, mas ions
since ceased. In the report or every Comp
tIOller of the Currency during the last tWen-
ty years the wisdom of changing the EXIST
ing law so that the banks and through tnehi
the communities in which they are locateu
might have the additional benefit or an adu-
cd loanable capital has been urged; pc
spite all this the law still remains WITHOUT
amendment. Not only should the bank act
be amended In this particular, but Con-
gress should seriously consider such a change
in the method of bank note issues as Will
enable the banks of the country to more ade-
QuateIy meet the demands of trade and com-
merce in all sections of the country.
1t is considered by every great commerciai
government, except the United States TO De
the sole province Of the banks to Issue the
paper which circulates as currency. Ine
belief in a bank note currency as being
better and safer than a government paper
currency prevailed unquestioned In this
country, until, under the apparent exigen-
cies of the war, the Government undertook
to issue paper currency. Even under such
circumstances the promise way already CIV
en-, however, that it should be retired at the
earliest practical moment. and the admis-
sion freely made that it was neither wise
measure nor a safe form of currency.
Between the competition of the Govern
ment note issues on the one hand and the
unnecessary restrictions imposed by law up
on the other. together with the increasing
price of bonds required to be deposited as
security, the note issuing function of the
banks has been permitted to become merely
an incident to the conduct OF the national
banking associations of the country. 1t has
been seriously suggested more than once that
the bank note issues be done away with, and
all paper be issued by the Government in
stead. The danger of such course is not to
I've overestimated. The experience of every
government has been that governmental cur
rency paper is source of weakness and
danger In the United States. where there
has been the nearest approach to success,
with the volume of the Federal paper COM
parativeiy limited In amount, the credit OF
the Goserrment has been more than once
put in jeopardy through it. and the business
interests of the country subjected to unnec-
essary loss and confusion.
The argument that the Government better
than the banks can provide for the redemp-
tion of paper note issue will not stand the
test of careful analysis. The Government
has no means for caring for its demand liabil-
ities. except through borrowing and through
the 1evying of taxes. Upon the other hand,
the banks have assets which can be prompt
ly converted into cash to meet their out
standing notes when presented.
The . tai number of national banks or
ganized since the system was put into
operation. in 1868, is shown to have been
5,095. On Oct. 81 last there were in act
i've operation 3.611, having an authorized
capital of $500, ,230, ,295. The total out
standing circulation of the banks then in
operation was 1929, 199,SS0 of which
500, ,9cse 800 was secured by bonds of the
United States, and the balance by law
full money deposited with the Treasurer
of the United States. The total circula-
ton outstanding of all national banks on
Oct. 81 last was $3.50, 131 ,005, of which
amount 81. .J5S, 500 was secured by bonds
held for account of insolvent and liquida-
ting banks, and $26, ,205, ,325 by lawful
money deposited for their account and by
active banks reducing circulation. The
net decrease in the amount of circulation
secured by bonds during the year was
S12, ,5S4 33334 and the gross decrease in the
total circulation was 1851 ,292.
During the year forty-four banks were
organized, with an aggregate capital stock
of 6,420,000. During the year seventy
one banks went into voluntary liquida-
ton.
There was paid to creditors of insolvent
banks during the year S13. .169, Isl in div
idends. The magnitude of this unequaled
record, the report says, viii be mere forci-
bly illustrated if considered in the light
of what has been accomplished heretofore
in the way of dividend payments to the
creditors of insolvent institutions. In
1898 there was paid in dividends $3,433,-
GAG; in 1894, S5.124,57 in 1895, So, $780,
So; in 1896. S2.451 ,959 and in 1897, $13,-
1863. .1S1, making Il total of dividends paid
within the five years from 1898 to 1897
OF S2T, T,56O,515, or 36l per cent. of all the
dividends that have ever been paid to
creditors of insolvent banks. From 1868
to 1897 there has been paid in dividends
SI5, ,935, ,925, and in the year embraced in
this report 81, ,169, IS1, or II 1-3 per cent.
of all the dividends that have been paid
during the period of thirty-four years of
the existence of the system. Since Oct.
81. the end of the report year, seventeen
additional dividends have been ordered,
amounting in the aggregate to about $685.
600.
The report contains the latest compiled
statistics relating to the worlds monetary
systems, and the stock of gold, silver and
paper currency. A very interesting fea-
ture of this statement is the per capita
amount of each kind of money in the
countries named. The per capita aver
ages in the principal countries of the
world are as follows:
United States, $23.10: United King.
dom. S2O.65; France, $34.6S; Germany,
S1S.95; Austria-Hungary, 1888, and Rus.
sia. $S.95.
The Comptroller renews his recommen-
dation of last year, urging that national
bank examiners be paid an annual salary
instead of fees as now.
A Little Problem from Life.
He begged kiss. She frowned medi-
tativa1v