The Norfolk Virginian. [volume] (Norfolk, Va.) 186?-189?, 1897-03-04
need OF NENl BANK Law
Rr' StuWesant Fish Denounces the Pres.
ent as Neither National ilor Rational,
CREDIT PREFERRED TO HYpOTHECATION
~ me h"sia Of - Innltim. system
lhts Only GHe ofScvcr;,i Remedies
proposed = Argument shows /.
leaning Towards state Banlss-A
review OF Effects or the System.

NS'ie" 0l Effects OF the System.
r,si,. r,sii. president or tho Illinois Central rail
iHinu, liMui,, ana vicc-prcsident Of the Park N.-
largest banks in thu Unitsd Stntesl ,ns
s,vei' s the manufacturers Record Of this
Mna.E WseK u, u conprehensivo Interview upon lilo
other things says: ~ - : i''s'1'ee'''3
Inc uliliculties which solvent borrowers &
anu ;, south, The great discrepancy between
,! me rates or interest charged them, when Is
,HnnS x;s,. arc IN obalnnble, ana those pre- s.
centres. Taken With the sudden md tre-
tmenaoMs variations in the rates for money
months. demonstrate that our hhn,tiu..
"s"te'h ~ neither national nor rational. NJ
y WAR MEASURE.
,,ame ame laws governing national bnnls orig
iinaliy iilliy showed in tiN,ir title thai they wcr.
ihiTmHea u,n,'ea 70 To- provide currency secured by
r f,a ,rSuIe ,,i T., or Government bonds, and were
banks. which liad both carital ana croG;i a
70 4 wnr xnrn0rl INC G9,vcrnment's finances. AS
n,M WI h,fmaii mGaHMre this may, have been wise
unjust 10 The merchants to whom those
~, nnnkS NJ, owed {. first duty. AZ II scheme Of
comlnerca these laws are unwisc inNthat
,leE ,aI make no use Of tho element or credit
The law requiring Il national ,banl, to 'Iorii;
UP $4,000 In Government bonds in order,
~ opthln inc privileges or issuing 100000
OF CIRCULATING cI notes first diminishcs Site tht
available funds of every small bank by
nrter Or more, ana then Is teaches
new To the business. To favor loans by'the
,mdks ,Iinks against a pledge OF securities rather
yar a on hv ISGsi.1are iSs a1ar j, paper given 70 the
action and endorsed by the latter Loans
on experimentation generally ana naturally
bank n special partner, in coimnerc.aI
,m9n.lia,GtMring ,IitI ,n an,l ngriculturul enter
railroad corporations. # Il'5a
AS TO BANK rREsETvIas. .J
That II bank must ut all times keen In
iGseI W n-ccrtasIl portion or the depos.tors'
money is. OF course. necessary. But The
serve may be deposited with other banks
III distant cities often places tho reserve
% out Of tho control Of the bank when It's "
cong cstion In the money centres It also
Lends Lends to leave lhe country banks at all
care for the lctyitma tie demands of their
commercial dcposit0rs. l171' II
serve OF hank fails below Inc uaen ne r'ie CEN, ne
named In the law, the directors shall not
make nn new LEANS ,n. q discounts. If strictly
CRISIS CRISIS ienI TO the bankruptcy Of all of
arc +" fhat Of the M nan iaslf
show by the diminishing capital or New
York banks that the, business there has
sketches n comparison Of the ban,sine
system or the United States, England and
NantaGes OF The latter two and says:
Why, then, this difference between our
national banks, and those OF other coun-
years of experience Congress still insists
upon Keeping on the national banks the
necessary to put on entirely new and Ut
terly untricd institutions with small cani-
dpadt ia # Vas tG None wfGn " the the
cial outcome OF the war purely problem-
atical. Ii-s ''-'''' I.
THE REMEDIES SUGGESTED.
Air. Fish suggests as remedies for exist
Of banking, on credit and not OH l,ynotha.
cation, that the necessary cost Of Eanking
be be made % e. as small as possible consistent
small concerns with limited means anu
Irsiqrs arr ii!ea ann nninown credit nt9
into two classes, those or deposit ana dis
count only. and those, OF deposit. discount
privilege of Issuing circulating notes 10
me amount equal 10 it's capital and sur
other permanent Investments and that the
former be relieved of the requirement OF
holding g per cent, of any other fixed per
cent. Of their deposits in cash.
The interest continued Mr. Fish, which
have in one Of the largest OF the New
,,.i,, Ynrk banks. banks. much much, Of whose business is
Win othcr national banks in every State
IN the union, would preclude me, il other
reasons were wanting, from adVoca ating.,n
unsafe or even doubtful method Of ,bl nix
Ing. What have said or may say reir,.-
sents only my own individual on:iions as
a citizen having, or, rather, rcpreSenting
varied interests in many States in the West
and South. 5a'I '3'N
Mr.. Fish notes the mighty changes That
nave occurred III the country since tie war
as Indicating the necessity for Il change,
and in conclusion says: nas
ARGUMENTS FOR a CHANGE.
AS far as the marc sal fc Keeping OF tii,
money OF depoSitorS aud its prompt u;ly-
nent on demand is concerned, the M, yioi!aI
banking system has worked hottcr t!iun
any system of which the country at lilri.
has had experience.
AS q system OF banking for those on.
gagged in commerce who base their urte;a
tons on securing from their banks lnnS df
discount commGnSurat tG with their aver
age deposits, tbs system has failed wic:i-
ever seriously tcStStl.
1t failed in 1865, Biack Friday il faiiai
In 1851 the Marine bank and the MetraIiqii-s
tan bank going under III New York: it@
failed again In 1850, on the i5ariii:Ss' s,.%-
pension In London; again N 1899. anI
| again In 1856 is5 Gt# Ea5&. ~ it%
do not say that the national n,s.sl:s ai,.
say that tic reliance CT f,ncrchant on hSi.;5
banks failed then nj each Of tnesa t!mts.s
and thatgthe fsnlt lies In the provisions 81
the national bank ACT as noE; In ISL
The tins for g change has come
EE6y5 az
#s$Bueknsham Lithsl ~ ater, clear s andS