Phillipsburg herald. [volume] (Phillipsburg, Kan.) 1882-1905, 1898-12-15

before constituted mis- legal reserve This dis
turbs the equilibrium OF relationship To re-
cover his position he turns upon the street and
calls In portion OF his loanA II the interior
banker, after thus calling for tho balances due
him, asks In addition for O loan, the city bank
or is often obliged TO inform him that money
is very close" and he cannot accommodate him.
Gradually, after more or less strain and anx-
iety sometimes bordering on panic, sometimes
resulting In panic, n readiustment Is secured.
Crops from the interior-not seldom forced
from the producers hands, with little regard
10 price, because of his inability TO borrow
from his local bankers-move 10 the seaboard.
The strain on the country is relaxed, Again
currency In thetorm OF reserve funds" moves
TO the center Again one dollar thus received
becomes effective as reserve for four dollars Of
liability Money IL quoted easy, as the pros
poet for summer dizziness becomes as sured.
Whoever has followed this delineation Of our
financial movement, and those who are familiar
with the facts which are thus portrayed ought
not TO have trouble in perceivng that the bot
tom cause OF the irregular and deranging ef-
fects described Is to be found In fixed
volume OF paper money clothed with
full powers Of q legal tender Upon
this money-itself a credit OBLIGATION
other credit obligations, In the form Of
bank deposits through bank loans, may be
built up In the proportion OF four TO one With
the volume OF paper money thus Gxed-with no
natural movement toward its retirement when
not needed In legitimate trade-the tendency to
build the four-story structure upon 1t Us per-
manent base is irresistible, The withdrawal
of the base by those who really own 1t causes
the structure to vibrate and threatens 1t with o
fall
Consider now, as briefly as may be-, the prac-
NtanI xffnp In - n m
legal tender-if substituted for the paper money
issued by the government Notification may
be found by those who will look for ii in sys-
TENS now current In France, Germany, Scot
land and Canada; or, II our own records be pr O.
ferred the New England system OF 40 years
ago, or those then In vogue In Indiana, Iowa
and Louisiana, will be equally good examples
When, with the recurring needs Of the In
terror to handle its products OF the farm, the
factory, and the mine the power to issue CIR
cuatlng notes may be summoned Into use,
then the needs OF industry viii coincide with
the profit moving motives of the banker, and
the full value Of this latent power Will be ex-
perienced not In the centers, where bank
notes are not needed and will not circulate, but
In the interior, where raw products are raised,
and where the busy wheels OF shop and factory
certify that labor wages are to be paid.
The power OF the bank note, so temporarily
suspended, win always be restored in full upon
the coll OF industry The power OF our present
currency, ON the contrary, Is not suspended. IL
is, as pointed out. inevitably misdirected. 1t
artificially stimulates speculative activity In
securities at the centers 1t practically alb
serbs the credit powers at times when they
should be made Serviceable to the whole coun-
try 1t ministers TO the speculator, 1t preju-
dices the producer the merchant and the man
ufacturer, though at last, all suffer from
It's deranging influences These are the rea-
sons, the more important reasons, why our
banking system should be reformed and made
effective to commercial and industrial needs;
and these same reasons, with others not here
set forth. call for the elimination, In safe and
proper way of the injurious interference in our
currency system by the legal tender paper
money OF the government
II 1t be conceded that the legal tender money
issued by the government does not possess the
qualifications to make 1t proper factor in the
country's exchanges OF products and manufac-
lures; II the fact also be admitted that 1t Is q
deranging and disturbing factor in its relation
to industry and commerce, then the time has
come to substitute for it currency which will
adequately, economically and safely meet the
ever growing needs OF the country, rapidly de-
veloping, us 1t is in the power OF production,
in the number OF its people and the importance
OF its domestic and foreign trade.
In the nature Of things the banker is the
proper agency for operating this important
| function, He must have motive for his action
| or he will not exercise it Given this motive,
| he WILL like the laborer the merchant or the
professional man. be dlligent in the employ
ment of his powers.