The herald., 1897-01-24

Iuncttou ~ b9nND OF Issue. The pre-
MUM on their bonds and the limitation
OF their currency emission to 90 (ndnety)
per cent Of the par value of those bonds.
and the taxes levied upon them, have
practically put an end to the profit
originally derived from their circulation,
and they have yielded largely to the
temptat tion to dispose of their bonds for
the sake OF a premium and have used the
resulting increase In their capital to
strengthen their commercial side, TO
the weakening Of their issue function.
No reflection 10 intended upon the sys-
tenn. when It is said by busi-
ness men Throughout the coun-
try that It has become in
adequate to the necessities OF the peo-
pie. While 1t Is true that we transact
every year less Of our business by the
actual use of currency in any form, 1t
Is also true that this fact is not made
plainly apparent to the people. and they
desire some system of banking that will
put the surplus capital of the country
Within the reach of localities distant
from the money centers This is the
cause of the cry for reform system
of banking, even though that reform go
to the length of removing the 10 per
cent tax on state issues and revival
of the state banks of issue. Some prop
ositions have been made for a banking
system copied quite directly from that
of England; but it Is very doubtful
whether it will meet the needs of the
country. European banking systems
developed out of the experinece of the
Bank of Venice and Of Genoa, and final
ly that OF the Bank of England; but
Venice was interested in foreign trade
almost exclusively her own territory be-
Ing limited. She controlled the COM
merce Of the Orient, gathered it and dis
tributed 1t TO the countries around her.
Genoa did the same, and under the same
circumstances The same may be said
OF England England g largest concern Is
in her foreign trade Trade Of that kind
may we'll be sustained upon a banking
system entirely different from that re-
quired by this country. While our for
eigr trade Is very large and important,
its volume Is small In comparison to the
volume of our domestic commerce. Our
territory - so extensive that this diomes-
tic commerce requires a system of cur
reucy issue that wild place the surplus
capital of the country in the midst of the
production of the country. That is to
say, very far removed from the financial
centers, in order that the rates of inter-
est may be held down and that surplus
capital may be at the ready command Of
the producer who desires to use 1t In
productive enterprises. In these days
the agricultural producer is an interna-
tional merchant and business man in
precisely the same sense as the manu-
faoturer and importer and exporter and
merchant engaged In domestic trade
are bushes men. Our cotton planters
in the south are concerned in the
wea ther and the conditions affecting
cotton production in Egypt and India.
fhe wheat farmer of the Dakotas and
California Is interested in all conditions
that affect the production Of wheat In
H. Al~ I'D fvsn1 10 n
the Argentines. These agricultural pro-
ducers must have the same access to
capital. the same business facilities, the
same opportunity to use their credit, as
the merchant and manufacturer. 1t is
believed that the national banking sys-
tenn does not furnish this equality of
opportunity to all Of these business
classes, and it's substitution by a more
flexible system Is desirable All of these
things were considered by the Indianap
Oils conference. Every important in
terest of the east, south and west met
there in discussion of the problem and
reached common conclusion. In that
discussion the east must admit that the
west led, that it's views were plainly
put and their force acknowledged by
the east and the result means that the
matter is Of common interest to every
section of the country. An examination
the reform will come in the liberalizing
and enlarging of the national banking
system, because the constitutions of
many of the states forbid state banks of
issue, notably those OF California and
Texas. 1t is true that the constitutions
of such states can be corrected in that
particular by amendment, but even II
this Is done and we have a system of
issue banks founded on local authority,
the practically unanimous opinion of the
conference was that such system shall
still be under such federal guarantee
as TO transfer to it all of the excellent
safeguards of the ma tional banking Sys-
tenn (which now protect the bill holder
and the depositor, with such changes Is
may be necessary to give the issues of
the state banking system uni
form value and credit in every
part of the union, as Is now the
case with the ma tional bank bills Sure
ly 1t is not beyond the genius of our bus
mess people or the power of congress to
speedily perfect and present to the
country a system following one or the
other of these lines. When this is done,
credit will have a ready access to sur
plus capital in all parts Of the country,
the rates of interest will be equalized,
collection laws will have q tendency to
improve and there will be a more thor
oughly national feeling amongst our
business classes In every part OF the
union. The plans and suggestions offered
to the conference from the Bankers as
sociation OF California and Mr.. Frank
Miller of Sacramento a member of that
association, were very favorably re-
ceived and ordered transmitted to a
commission that would have to be Gre
ated either by congress or by the execu-
tive committee of the conference, and in
default OF either. to be put In the hauds
OF the banking and currency committees
of the two houses of congress.
Senator Chandler will today intro
duce the caucus committees bill for an
international monetary conference, and
will ask to have it acted upon tomor-
row. Senator Pettigrew is the only MEM
ber who has openly announced his in
tention to fight the measure, but it is
expected that others will vote against
it, and will take the position that moth
ing is to be gained by an international
conference.
THE NICARAGUA CANAL BILL.
The Nicaragua canal bill Is in bet
ter position today than 1t has ever
been. The friends of the measure in
the senate look for it's early passage by
that body. 1t is not expected that the
house will act favorably upon the bill
at this session. Senator Morgan has
charge of the matter and will endeavor
to reach a vote before Saturday The
railroad people are undoubtedly fight
ing the bill, and as Speaker Reed pos
sesses an affection for them, il is gem
orally supposed the bill will get as far