The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1901-10-31
Big MOVEMENT ON FOOT
EFFORT TO SECURE GOVERNMENT
BONDS AND CURRENCY.
Representatives of National Banks
Intercsted-ObscryaDt Banker.

Reports from reliable sources state that
steps are being taken to organize repre-
sentatives of national banks that have gone
out of business in q movement TO secure
from Congress legislation by which the vast
amount of government bonds and currency
which has been lying in the national treas
ury for years as Security for the circulation
Of such banks may be turned over to the
persons entitled to receive them.
In order 10 appreciate the magnitude and
importance of this movement it is neces-
sary TO recount briefly the method by which
national banks secure circulation. When
such a bank desires TO issue money it is re-
quired to deposit with the United States
treasury government bonds, the par value
OF which shall equal the amount of the cir
cuIation requested. These bonds are kept
as security for the bank notes issued and
the notes are charged against the bank that
receives them. Formerly national banks
were allowed circulation only to the eX-
tent of 90 per cent. of the par value of the
bonds deposited by them.
When a national bank fails or goes into
voluntary liquidation and requests that it
be relieved Of it's circulation it must gather
i'm and forward to the Treasury Department
ali OIL It's notes LlldI II can Obidln- III ouu
ton to this the government officials keep a
sharp lookout for notes of the particular
issue and as rapidly as they come in can
eel them and give the bank credit by the
amount OF the cancelled notes. Thus far the
plan works admirably. But il contains q
defect which has for years been regarded
by national bank officials as decidedly
serious.
RECOVERY OF BONDS.
In case national bank notes are buried
or destroyed in some manner. there is no
way by which the owners OF the bank can
recover their bonds to the extent of the
destroyed circulation. Under the present
system the government profits by all de-
stroyed national bank circulation.
This defect has been pointed out by sew
eral controllers and treasurers of the United
States and has been bitterly denounced by
bankers all over the country, out thus far
no successful concerted movement has been
started with "A view 70 rectifying it.
The size of the lobby that VIII be formed
may be guessed from the statement that
out OF the GOO and som odd national banks
which the government has chartered since
the national banking law was enacted years
ago. something like 1900 are not now in
business. only five national banks in the
United States are without circulation.
among them being the Fletcher National
of Indianapolis and the Riggs National Of
Washington. ID. {. All OF THESE institutions
without circulation are in active business.
So that there are in the United States the
remains of 1000 national banks which still
have on deposit i'm the treasury either
bonds or greenbacks TO secure circulation
of which no trace can be found. Estimat-
ing that only five persons are interested
i'm what Is left Of each one OF these insti-
buttons il appears that 10000 persons will
be TONED together in a powerful effort TO
secure the enactment OF a remedial law
by Congress.
\ form of statute that has been sug-
eestcd for this purpose provides that I'm
OF business for a period of twenty years
prior to the enactment of the law, their out
standing circulation shall be deemed void
If N is not presented for redemption within
a stated DeriOd. say two years. after the
Dassacc of the law. The law would also
require timely publication Of The names
and location Of all national banks coming
within the scope of its provisions.
THE enactment of such a law. declares it,
advocate. would at once cause people all
over the country TO investigate their sup
Mics of currency to learn whether they
have any that is required 70 he preserved
for redemption within the prescribed limit.
and IL banknotes had been buried or de
stroved. nobody would be the worse If such
money were declared valueless.
DURING THE CIVIL WAR.
An Investigation of this subject disclosed
the interesting information that much OF
The lost national bank note circulation of
the country disappeared during the civil
VAR. A. that time. AS is readily recalled
by the older people. little metallic money