The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1902-04-21
Mr.. SIICKNEY'S IDEA
He Addresses Minneapolis Bank
Clerks on Assets Currency.
HE CONDEMNS THE PROPOSITION
Prof. F. l.. McVey Speaks in Favor
Of the Other Side of the
Question.

After an excellent dinner in the ladies'
ordinary of the West hotel, Saturday
night. the Minneapolis bank clerks and
number of invited guests listened to an
interesting and profitable discussion of
the question OF assets currency. The oc-
casion was the associations third annual
banquet. 1t is the intention to make
these events memorable on account of a
paper on some question of great interest
to bankers. A. B. Stickney, president Of
the Chicago Great Western railway, was
called upon to deliver the leading address
this year. His subject was The Funda-
mental Principles of Money" It was a
review of the history of money, showing
that money is essentially commodity
Upon the foundation thus laid, Mr.. Stick
ney devoted the conclusion of his address
to strong attack upon assets currency
Professor F. l.. McVey of the university,
who delivered the secondary address, had
for his topic Functions of the Banker
in Modern Industrial Organization" He
came to a conclusion squarely at variance
with that of Mr.. Stickney. The two ad
dresses, though their subjects did not
suggest it, amounted to joint debate,
and the arguments were closely followed
and eagerly discussed by the assembled
dealers in money and credits.
The Gold Reserve Vital.
Mr.. Stickney argued that paper money
must ultimately rest on a gold reserve,
and that the only way in which it can
be maintained at a par with gold is by
the known and undoubted ability of the
responsible party to meet the obligation
expressed by paper money and meet it
instantly upon demand. Mr.. Stickney
doubted whether notes issued by 5000 to
1000 Independent banks all over the
country, even backed by the gold reserve
each would have, would be able to COM
mand confidence. The United States gov
eminent. which is at present behind all
our paper money, has not, with all its
resources, wealth, stability, great gold
reserve and power to maintain it by using
bonds, been able to maintain it's paper
money at par at all times. Can thousands
OF scattered banks do better? Il con-
fess,' said Mr.. Stickney, that l am I'M
able to discover any reasonable ground
for the expectation that the banks with
out dollar OF available gold, because it
would require more than all the gold in
their country for legal reserves against
deposits. and without any borrowing
power whatever in emergencies could
sustain 80o,000,O0O purely fiat paper dol
lars on a parity with gold Continu-
ing, Mr.. Stckney said:
AS have before stated. the history oil
paper money conclusively proves that its
value cannot be maintained q par with gold
unless the responsible party has the known
and undoubted ability, not to ultimately pay
it, but Immediately en- presen tation to pay
1t In gold. There is a vast difference between
the ability Of ultimate payment and the
ability Of immediate payment. When the
holder Of a note wants it paid he wants the
money, not to be told that there is no DANCE,
OF ultimate loss. ..
The ability Immediately on presentation, tc