The San Francisco call., 1899-12-29
BANKS AS VAMPIRES.

THE Chronicle admits that in matters OF finance
il is easier to discuss doctrines than prove
facts
We asked for an instance in which bank had
sought profit by the ruin OF lis debtors effected by
locking up money TO depress prices. In answer the
emergency bond sale by President Cleveland IS
quoted That, however, was transaction that bears
nb resemblance 10 the process which the Chronicle
fears banks may indulge in to enrich themselves by
the ruin OF the community The rapid drain OF gold
from the treasury had brought the reserve TO the
danger line Unless i we're replenished II mat
ter perhaps OF hours Tor the treasury TO go broke
specie payments suspend and the public credit get
blow that would cripple il indefinitely. Congress
sullenly refused TO the OF the Govern
ment when all the facts were calmly and frankly laid
before it by the President 1t was actuated by the
same stubborn and destructive spirit that is in the
opposition TO current measures OF financial reform
The President had no time to appeal to the country
10 advertise bonds Tor the competition OF bidders
On one side was the immediate prospect OF nsol-
vent treasury on the other an ignorant and hostile
Congress. To meet the emergency the contract was
made for gold on the best terms at which the large
amount required could be had in the short time left
10 the President TO the public credit No
bankers were locking up money to depress the pre-
mium on bonds; the Government was a desperate
borrower.
When the last bond issue for the purpose OF replen-
ishing the gold reserve was made by that admnistra
tion the President did not wait until an emergency
appeared that must be instantly knowing that
Congress would give no relief a general advertise
FOR competitive bids made and the banks OF
the whole country competed TO such extent that
the amount OF gold offered was immensely in excess
OF the amount required by the Government, and the
-, Il
placed terms exceedingly satisfactory 10 The
treasury.
This opportunity TO lock up money, lower prices
and take a cinch out OF the Government was not i'm
proved. though according to the Chronicles idea it
was just such situation tempts banks TO play
vampire As other evidence OF such sordid policy
the part OF banks Is offered. and this evidence is
inapploabe. we consider the charge Withdrawn be-
cause unsupported
The Chronicle falls back upon plan by which na-
tional banks contract the currency and declares
that can be done by refusing pay out their own
bills on checks or by destroying theml
II they have other currency TO pay on checks il
makes no difference which they pay or which they
retain. The currency is not being contracted as long
as they meet the demand for it. But If a national
bank having IFS own bills hand and having paid
out all other forms OF currency in its possession
SO1i1 lOlNSS ~ liohol ucpOStotS cncCA IN ITS own
bills. or should destroy its bills prevent their cir
cuation we are OF opinion that one responsible
FOR such bank would get into the pcnitentary
The Chronicles suggestion OF a method for doing
something that there Is no selfish reason for any bank
10 do passes ont OF the limits OF financial discussion
and invades those OF humor. II the charges brough,
against banks true, instead OF being needed in
strument OF business and filing want in modern
civilization they criminal enterprises menace 10
the community, and should be suppressed
The fact is however that banks OF issue have no
more power over the volume OF currency when it is
once emitted and is the property OF the people than
any other banks OF deposit which loan money and
sell exchange.