The Manitowoc pilot. [volume] (Manitowoc, Wis.) 1859-1932, 1900-01-04
NATIONAL BANKS.

JOHN MCCARTY Of Cato sends shl
from Nebraska populist paper on Ma
tional Banks. The old argument is USED
that the national banks draw interest on
the bonds they deposit rs guaranty 10.
the redemption Of their notes Of issue an
loan these notes of issue at current rate
Bob Schilling showed to his own salts
hearers in this city that MI that was net
essary to become rich was to buy few
tons Of coal and separate it into It's ele
,nenta. Each constituent would be NOR
valuable than the total coal from which
it was derived In short each part wa
greater than the whole Of which it wa
a part. Bob's contempt Of wealth ~
doubt prevented him from adopting hi'
scheme of money made easy. And
there must have been lingering doubt
IN the minds of his hearers IN to the cor
rectness Of his figures as their was NJ
rush for investment in coal which prom
iaed immense returns.
yf there is such enormous piofiis III ma
tional banks why do not their numbers
multiply more rapidly?
The Pilot does not want to defend ma
tional banks But it will say this con
corning them, that no other kind OF bank
in the United States has ever offered ~
good security for the redemption Of ITS
notes ~ the national banks do. The
chief requirement Of II bank OF issue Is
full and ample secu ity for the redeInp-
ton of its no es. The security Of the
nOtehoder should receive more attentio"
than should any effort to prevent advan-
tage resulting to the hank. The govern
m.nt would have to pay interest on 1t
bonds even though they were not depos'
tied in the national treasury to secure
the redemption of notes which pass cur
rent. The curse Of our state banks wa
hat all forms of securities were accepteC
~ a guarantee for redemption. When
the securities became worthless and
they had habit Of doing so the bank
notes ceased to have value The holder
of any circulating medium must have
absolute assurance that the notes are
good and always will be good even though
the bank that issues them should fail
That security our present banking law
give
Why not look at the good feature IL
stead Of cternally harping upon the ad-
vantage to the national banks, when
there is really but little advantage 81
small that some of them do not avail
themselves of it at all? They can issue
only 30 per cent Of the sum DEPOSITED
and must pay n tax on their circulation
The bonds do not average over three per
cent.
The popuists want the government b.
issue greenbacks. our financial woe
come largely from those same green
backs The Treasury Department was moi
designed to be n banking institution ant
never can become one successfully.
Banking is entirely foreign to its pm
pose and always will be for the reason
that government can never adjust itsel!
promptly TO industrial changes and will
never have sufficient hexibility to meet
exirencies. But you can't talk this TO
she populist hnancier who would manag,
money matters by instinct and not by
reason.
The Pilot does not think the issuance
,sf bank notes on bonds as security the
best thing possible But it is by all
means the best system yet developed
in this country The security for re.
demption should he gold, and the govern
ment should have nothing to do with
banks except to see they are honestly
conducted The farther we get the gov
ernment away from the banking bust
ness the safer we are