The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1898-12-30

those notes are based remain in the
custody of the issuing bank. the objec-
lion might be met by enacting that
notes of this character shall be issued
only through clearing house associa-
lions which are 10 hold in trust the
commercial paper or other collateral by
which the notes are secured. just as they
now do in the case of loan certificates,
and as the treasury of the United States
does i'm the case of national bank notes.
IL may. however. prove impossible TO
secure legislation of the character de-
scribed. In such event the existing sys-
tenn Of notes based on United States
bonds should be so amended as to give
to IL as large a Measure OF elasticity as
Is possible. Tho provisions of the Jaw
OF 1852 which limits the amount of notes
that may be retired in any one month
and prohibits reissue within six months
after retirement. should be repealed. To
secure in some degree that increase In
p~rofitableness which,. az we saw earlier,
Is indispensable to elasticity, IL would
be well to raise the ratio of notes to
bonds deposited and TO lower the tax. or
better still to levy II on capital and sur
plus. In order still further to enlist
the s~elf-interest of the banks. especially
on behalf of the prompt retirement OF
redundant notes. we should be inclined
to prohibit any bank from paying out
notes Of any other banks except to the
issuer or To the redemption agency. As
respects making easier the processes OF
expansion and contraction. some gain
would probably result from requiring
the comptroller to keep on hand a SUI
ply of notes i'm blank. and Sill more
from an increase in the facilities for re-
demptlon.
Country B~anking-As already re-
marked, there Is a real need for in
creased banking and currency facilities
In tho rfaNNaF mr. NanNn hnalN No rl naHsa
OF the country. and legislation could do
something towards satisfying this need.
In the judgment of your committee. the
most effective as well as the safest ex-
pedient for accomplishing this object is
some system of BRAN banking similar
to those in vogue In Canada, Scotland
and other countries. Under such a sys-
tenn. banking facilities can be fur
nished to communities too small to sup
port even the smallest independent n
OF issue: and capital can be most
cheaply and easily transferred from
districts ~oversupplied To those needing
IL; while, at the same time. the dangers
OF fraud or mlsmanagement incident to
all banking are far less serious than un-
der a system Of small Independent
banks. There are doubtless objections
To the plan; but the experience of Other
Countries has shown hat they are not
or great moment.
~ HoNtNtT. the apparent tendency
towards excessive concentration of cap
ital shall prove too strong an objection
To this system. other alternatives offer
themselves. a decision to permit the
issue OF any portion of the circulation
upon general assets would greatly in
crease the banking facilities Of the
country districts. since the chief OBJ
stacle at the present time to the estab-
lishment of national banks of issue in
such districts Is to he found in the cir
cumstance that they could not afford
TO invest their capital i'm assets so
unproductive as United states bonds.
Another remedy for the difficulty I'm
question would be the exemption from
the federal ten per cent. tax on circula-
ton of such state banks as should COM
ply with the regulations Of federal law
and submit TO federal supervision. This
change would. without doubt. greatly
increase banking facilities. while. at
the same time. II would probably prove
quite safe. Again. "A lowering OF the
minimum capital for a national bank
from the present figure to twenty or
twenty-five thousand dollars would be
better than nothing. and would proba-
bly, work no V effect of any moment.
Conclusion.
In conclusion. your m can
not refrain from expressing the convic-
ton that IL viii be "A genuine misfort-
une OF the very notable movement
toward monetary reform which has
filled so large a place I'm the history Of
the last few years. shall pass away
without having left any results i'm legis-
lation. Never before have there exist
ed among all classes so great an inter-
est In this subject. so near an approach
TO unanimity Of opinion. and so strong
a purpose To see something accomplish
ed. To this very promising attitude
Of the public mind are added external
conditions OF an extremely favorable
character. We allude to the exception
ally large stock OF gold both in the
treasury and I'm the country at large. To
unprecedented trade balance, to
h generally solid condition of bust
ness. 10 the absence OF any necessity for
that haste which always makes legisla-
tion In crisis dangerous. and. mo- least.
to the approaching control of all de-
partments Of the national government
by a single political party. A conjecture
In so many respects favorable. we can
scarcely hope To meet again in the near
future. Its utilization would. there
fore. seem To be commended by every
consideration of prudence and good
judgment.
Without doubt. there are stln con-
siderable obstacles in the way Of re-
form. IL is easy, however. to exaEEer-
ate the seriousness OF those obstacles.
Your committee wish particularly to
remark this In respect TO the much
noted Emergencies OF opinion among
friends Of reform. This not
opinion that these Emergencies are 80
serious as to render hopeless the pros
poets of reform. We consider quite un-
warranted. AS a matter of fact. bar
ring differences due To the circumstan-
ces OF some being more. others less
radical. the various projects OF reform
have a surprising similarity. Doubt
less there are differences Of method
So fundamental tina: the choice of one
plan involves the rejection of its revals:
but cases OF this sort are comparative
~ few. An analysis az a large number