The times. [volume] (Richmond, Va.) 1890-1903, 1899-01-19
Jur Currency Problem and Some So
lutiOns Suggested.
OUR SYSTEM AN IMPERFECT ONE
Financial Writers Agree in Condemn
ming 1.-THE Treasury Should he
Relieved from Redemption
or all Paper Money.

an address before the Brooklyn Institute
OF Arts and Sciences. last night In Brook
Ign. \. y, ON Tho Currency Problem OF
the United States"
he said IN part.
The currency problems OF the United
States" are clearly revealed i'm a plain
statement Of our banking and currency
conditions as compared with those Of
France. Germany. England, and every
other highly civilized nation. Each Of the
countries named while having systems
varying 10 some degree an may be said
20 be normal That Of France Is built
down from the top. having one bank
with branches extending into every COM
munily. like her government Our peo-
Pic insist that our banking and currency
system shall be built up or units from
ihe bottom each bank Independent OF
AN others as are the men ia q town.
who together make tho body polite.
our free banking law. allowing any five
reputable citizens anywhere 10 form a
bank by getting together the required
capital. VIII never be abandoned. Nor
need ia be. a system individual as TO
each bank. but united into one solid
structure for an purposes whore union
IS necessary. viii give as a banking ana
currency system as much superior 10 the
banking and currency system OF France
as our Institutions are on "a more sofia
foundation.
MUST RE SEPARATE.
AL human experience proves
THAT Il is not possible 90 have
sound banking and currency system I'm
this country. as there never has been Ia
any other. while 81 IS not complete in
itself 1t must be wholly separated from
al rrfn
eminent Treasury. as that is of France
Germany England and every other first
class country. the United States alone
excepted
2-1hat 80 is not possible to maintain
the parity between paper money and
gold where q multitude OF independent
banks exist except by restricting the
legal tender coin 10 gold alone, as in
England
5-That where there are two or more
kinds Of legal tender money. each diff
fering widely from the other in intrinsic
value-as paper silver ard gold-it is
impossible 10 maintain parity without
making a lion Of an banks sufficiently
solid to make each one and all equally
responsible for maintaining the parit'
OF all moneys in circulation and prsc.
ticaly making an banks act together
as one whole for maintaining parity, as
In France. Germany. etc
Nearly every government has tried the
banking and currency experiment the /
United States Is now trying and every
one trying IL has miserabiy failed. There /
ara no two opinions on our utter failure,
since 1893, especially I'm view Of the fact
that We are wasting $4,000 000 I'm trying !
the experiment Up TO 1898 60 was the /
fashion 90 pronounce the financial and /
banking system Of the United States the /
best the sun ever shone upon. To-day
there is scarcely a man in the country !
who has any interest in questions per- /
tanning TO economics if there is even /
one, who IS not demanding It's imme- /
date reform.
WORST or ANY.
Hon. James p. Eckels. ex-Comptrollcr !
OF the Currency In answer to "a question |
by the chairman, said 90 the Banking I
and Currency Committee:
"Yes. the United States has the worst
financial and currency system of any ]
leading nation"
Upon the above being read 10 Hon
Charles S. Fairchld. ex-Secretary OF the
Treasury. and his opinion asked he re-
Piled. II think 81 IS tho worst" and !
Secretary Gage concurred i'm MI Fair
,hild's statement.
~ A't'NH NiA NAAtAh0 Wi AiIANlN.fr UNIIhr !
ng and currency are a unit fin con-
iemning our systom-th0se of Europe de-
'laring that there is not r. dollar of true
bank currency or really sound currency
N the United States.
only foreign commerce tests the
measure OF value coin" in the banking /
ysiem Of any country England. as the
clearinghouse of the world needs four
lines the gold that is needed in This
country. and she has less than half
- much. But OF her N3S 100000 of gold
Ier visible gold S225. eco eo0-is I'm her
anking system whore 30 can De pro-
ected by her immense banking capital
nd cash reserves. by raising discount !
ates. Her banks are required by law
p bear tho burden Of redeeming I'm gold |
iur banks are absolvcd from this duty, |
to sound banking
Germany has only Sl55e0c0O OF gold I'M
er banking system, whrh is protected |
y the cash reserves held by banks. plus |
heir capital, and Is effectively protected |
y the power 10 increase rates on dis
cunts.
50 with France. To raise the rate OF
lterest on loans IS a quick and sure
rejection Of gold In banks Then why
estate as 10 % remedy?
No one wants gold excepting in times
hen he thinks hc may not be able TO
et a. The certainty of getting gold ION
emand' plus a higher rate of interest
~ take gold 10 any place regardless
/ whether that place has a sound or
usound currency and Of every other cir
instance or condition.
PAPER MONEY.
The whole theory and practice Of ,
,und paper money IS that the person re- :
.ivins II from the bank gives the bank
title 20 products IN has possession, in q
Is time note. TO an amount equal TO the /,
mount OF paper money he receives. - =
InS very existence OF sound paper ,
oney IS only possible In a currency
iat has potential and aclVal daRy gold
and daily redemption Is only
,ssible in true bank circulating note"
IA circulating note issued by banks /
sainst assets and for which the bank
ceiyes the peronal property note pro ,
lCts) TO a like amount. with which 10
deem the notes. such as Is issued in
ngland France. Germany and IN every s
untry excepting the United States s'' 1
Because city banks are allowed TO DO .
ssiness by accepting the only form OF Z
posts. thclf customers can use. viz q
nix deposits. and country banks are /
Il allowed 10 do business by using the
ly form OF deposits their customers
n use by issuing currency. interest IS 1
cessarily twice as high in the country
In the central reserve cities. ,
Banks in cities cannot issue currency. | /
seir customers cannot use g. City 4
isiness requires checks. drafts, etc. q,
snticai IN substance with bank curren- q
The customers OF banks IN strictly
untry districts cannot use checks. drafts, %
O. Their business requires currency. L
N this reason the national banking law | 4
actically prohibits banks In al strictly