The record-union., 1898-01-05
The CURRENCY QUESTION.
VIEWS EXPRESSED BY THOS.
G. SHEARMAN.
Establishment of Branch Banks on
a Large Scale He Believes the
Most Practicable Remedy.

NEW YORK, Jan. 4-In response to
request from the Monetary Commits
sion for an expression of his views on
various financial questions, Thomas c..
Shearman of this city has submitted to
the commission a paper on the estab-
lishment of branch banks on a large
scale.
II regard this plan as far more i'm
portant, as well as more practicable y
says Mr.. Shearman, than any other
remedy which has been proposed for
the settlement of the currency ques-
tom
Mr.. Shearman insists that nature
has driven conditions forward to a
point at which the whole country is ac-
tually on banking basis, instead of a
money basis, for exchange.
Those sections of the country which
have the fewest good banks are just
as much upon a banking basis as the
rest of the country" he said. 1.-THE
tremendous increase of exchange, which
has gone on with advancing civiliza-
ton, has reached proportions which
make it hopeless to expect that such
exchanges can ever be carried on by
the actual use of money, however that
ter may be defined. And whether
money consists only Of gold and silver,
or includes also bank and Government
notes, representing gold and silver,
makes practically no difference. There
is not there never was, and there never
will be enough money, even within
these liberal definitions, to enable one
tenth of the exchange of this country
to be conducted by the actual use OF
any such money. The disproportion
will increase instead of diminish.
Large central banks ought to be al
lowed to establish branches in every
part of the country" continued Mr.
Shearman. ''These branches could be
conducted with great economy, and,
therefore, could furnish the means of
exchange at but slight advance over
the cost of exchange in the cities. They
would have practically just as good in
formation as the city banks have, be-
cause every morning they would be ad-
vised by telegraph of every change IN
affairs which the central bank consid-
cred important in the management or
its own transactions. The amount OF
actual money in each of these branch
banks would be extremely small, and
vet the amount of actual money avail
able in each, in case of some local pres
sure, would be fifty times as great
since all the resources of the central
bank would be behind it.
THE effectiveness of the branch bank
system in solving the currency problem
Is sufficiently proved by the example
in Canada, where this system is in full
operation and the currency question IS
never raised.
LAS a condition of permission to es-
tablish branches, the present bank and
every branch thereof should be re-
CURED to accept the certified checks OF
any branch on deposit as equivalent 10
cash which, however, they would un-
doubtedly do without compulsion. If
the central bank issued bank notes, all
the branches should be required to re-
deem these notes UP to such moderate
amount as might be reasonable. AS
further condition, every bank establish
ing branches should be required to ac-
cept on deposit, and collect without
charge, checks upon any other national
bank, though not, of course, to credit
the amount of such checks as cash until
collected -