The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-08-09
THE BANKS PART OF THE WORLDS
WORK.

Most people will admit that the railroad
and the bank are two of the most impOr-
tant agencies in facilitating and developing
the business and industries Of the country,
yet the haranguing demagogue has so thor
oughly done his work that in the country
at large both are under the suspicion of
many people. This is particularly the case
with the bank. In some instances the hos
tility may be due to the failure of many
persons to obtain credit at the banks; still,
the prejudice extends beyond the class of
men whose paper is refused by the banks.
This prejudice is less general than ii was
years ago, and is now rather against the
bank as a national institution.
Last week the clearings of the banks of
the country were s., 90, 5SS 56S, or an amount
equal to the entire currency of the coun-
try. The average clearings of the banks
the first week in January and last week
were s., 165, OOO, 900 in round numbers. AS
Stunning that that amount is the weekly
average for the year, the amount Of bank
paper passing through the clearing houses
of the country the present year will be
Sill, 600 100000. These are large figures, but
they do not represent the whole of the ex-
changes OF the representatives of money
made through the banks. AS no actual
money passes through the clearing houses.
this immense amount represents credit
| money-drafts, checks, etc.-which the
banks make available to the business of
| the country. To effect this exchange and
cancellation of bank paper by the clearing
| houses requires comparatively a very small
amount Of real money. Last week $10,161 900
Of bank paper passed through the clearing
house in this city; this was Cancelled, so
to speak. by the transfer from the debtor
banks to the creditor banks of not over
100000 legal tender money. Indeed, 1t may
| be effected without the use OF a dollar OF
cash. The point ii is desired 10 make and
emphasize is that without the banks this
vast amount Of credit money, composed
| of the checks and drafts passing between
business men, could have no existence. So
| ii may be said that the banks make pos
| sible the vast amount of credit money
| with which the enormous trade and in
| dustry of the country is carried on. A few
! years ago it was shown that only about 5
| per cent. of the payments made in the
country were made in actual money.
The other function of the bank is the
receiving of deposits. 1t is the agency by
which the bulk Of money Is put where IT
can be made available to the business OF
the country. Very few men handling much
money now keep it about them, but take
it to a bank both for safety and con-
| venience. To-day the roll of bills in the
possession of a man is not accepted as ar
evidence OF opulence. but Of carelessness
But for the bank millions of money in q
country like Indiana would be boarded by
| individuals as so much dead property
which is not held in amounts sufficiently
large to make the loans required by al
extensive business. If the larger of the
hoardings are loaned at all it is to in
dividuals in small amounts, and at a high
rate of interest. The bank, by collecting
and loaning the money of individuals, ha.
been the main agency in reducing the rate!
of interest so per cent during the pas
twenty-five years, and not the increase o
the volume of actual money.
1t is not the purpose of these Observa
tons to present the banker in the attitud
of a philanthropist, or to say that he il
impelled TO engage in the banking
business by the single purpose of benefit
ing his fellow-men. In regarding his owl
interests he is just like the rest of man
kind. 1t is. however, the present purpos
to show that the bank is a most necessar.
institution, and that no class OF men con
tributes more to the worlds work thai
bankers. Therefore, the element assailini
bank and banker should be confined t
the open-mouthed demagogue and hi
dupes the very ignorant.