Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1901-04-13
BANKS OF THE PIONEERS.
Brother the Late Senator Sherman Enertainingly
Banks in Early Days-Wldea Currency and Confidence
Between Man Ian
In the Financial System.

Man Were Features
,cia1 System.
I =. J.
back countless The numerous land
agencies, of which nearly every little
county seat had one or more Were pass
ling thru a transition state from mere
agents for the sale of land warrants and
entry of lands into full-fedged bank
ing houses, with very crude ideas of
what constituted banking: but with a
|realizing knowledge that their oecupa
lion of entering lands was gone, they
started in with calm assurance of
success, and adopted practices that set
at defiances every known law or usage
of banking. The sale of exchange,
care of deposits, discounts and
collections all afforded TOO little
business in themselves to furnish even a
modest living. and their time Was
ISpieced out by acting as a real estate
agent. a conveyancer. practieing law.
serving "a justice of the peace, a notary,
81 branch of trade or profession. accord
ling to the taste Of the individual bank
-er. or the needs Of trade. Tradition has
lthe barber VAS placed alongside thu
sign 81 the banker, both professions be-
ing epresented by one Individual who
Fcould thus give his customers literally
a doub!e. shave So that the profess
Sion of banker in those early days COW
ferstl almost every other calling or oecu-
patton BY which a scanty living could be
eked out
~,
lfieGgsd bankers wera putting them
selves in shape for future operations
GENTS Mere ecucrring in other states
tia I tended ~ make their path in bust
ness anything but rosy, and Which for.
ftle time hsing completely revolution
lied all pest experience With the ei,cu
States OF Indiana Illinois and WILSON,
1 banking granting to private corpora
to cireulate sas money, based only on the
security Of Il deposit Of state bonds With
"A state Official. II was literally free
banking everything relating 10 the orr
lganization Of a bank of issue being of
4 the SIM pest character. Tho corporation
lceuld BE- formed bystwo or more indi-
Z
blanks. involving little or no cxpense
! Ito inquiry into the standing or char
aeier of the men behind the enterpris
"a convict Was as good a subject 70 in
corporate as the honest ard tried citi-
fzen). The location could az We'll be N
obscure cross roads village of 100 In
importance fact the more obscure
9mate from ordinary routes Of travel. the
Egreatsr the difficulty ofretuiinirg notes
Ito il for REDEMPTION. and therefore. IN
4 lion the judgment of the promoters
tof the enterprise All ordinary barriers
That prudent legislators build around
hgreat privileges IF that efaiaeter. 10
protect the public from loss and iirsr posi-
tion. were In this case omitted; and any
dindividual, man or woman who cnult,
muster up money or credit enough d
get hold IF s25,ono of Arkansas. NIissis-
.II.sippi Or other Deprecated state bonds
|eeuld start up a shin-plastsr mill, and
sIdelsse the puhlic with the miserable
stuff even residence at tbs location OF
4 the so-eailed bank rot being required
Eas itss proprietor. The first move Of the
! piojeotors Of these Wide Institutions
! after getting their bank notes ready.
was to find locality in which to circu-
Late them remote from the point Of is-
i sue, 30 that their return for redemption
should be as tedious ard difficult a. pos
s|.sible. Iowa was an excellent field foi
these felloSvs 70 operate in. 1t had bu;
A meager facilities for handing bank
notes thru express coinpanies. banking
4 machinery for the return of this worth
less stuff was not IS We'll organized as
in older communities: nd besides all
i money vas scarce ard in great demand
Land a number Of bankers Yielded to tbs
Temptation held out TO them by these
4 free bank operators, and took their cur.
rency for circulation in their respective
neighberhoods. Some Of the induce.
ments held out to bankers to handle thi:
stuff weremeither the use of it three OF
six months without interest. or as Z
II loan in larger sums and for Longer
time at a nominal rate of interest, the
cpnsiderat ton on the part of the Dor.
rover being the guarantee to give 1T Z
lgood circuatioii--that is. to scatter II
out 90 thai il would ror return to tn.
81 point Of issue for redemption in lons
!; time: or If any of i, did bys chance GO in
= 10 pay cost Of its redemption. A few o
the banks organized under this systeu
. were Legitimate concerns. and the note
lissilcd by them Well secured ard of pa
!. l.vaiue. nut the greater number were es
sentially Wild cat in character. LOCATED
lat Inaccessible points; and in fact tn.
= value Of he circulation depended en-
ltirely on the worth of the state bond
I. deposited as security which We're most
! iy tllose Of southern states, som
J, vai5 questionable value becaus
! of Reputation In the past. ard al
subject 70 fuctuation in price in tn
: eastern markets. az about the only de
mand for them was as basis ON whic
. Itofound these paper mills.
. Tiis kind Of bank notes formed tn
: bulk of the circulating medium in low
! for several years, ard one of the diff
I Icult prablems to be solved by the fresh
:. inexperienced bankers of those day.
:, who had to receive this kind of none
!. from their customers, was how to kee
: 1t circulating go that 1t would not di
7 or fail on their hands. To add still flu.
. ther 70 the complication. some of gu
: own bankers. acting perhaps on tn
. theory of self-defense applied to a
? easy going Legislature of the then tel
: ritory Of Nebraska for bank charter
, with privilege of issuing circulatin
notes and these notes were based q