The Savannah morning news. (Savannah, Ga.) 1900-current, 1903-06-21
OUR CURRENCY SYSTEM.
Some Changes That would BE Bene-
nciaI,


Editor Morning News: In the bank
ers' convention, which met in Atlanta
a few days ago. one of the subjects
for discussion was the three days of
grace allowed on notes and time drafts.
1t seems to me this is a very trivial
matter and amounts to very little,
either one way or the other. If
party gives a note payable in thirty
days. he knows he will have thirty
three days in which to pay it, and that
he will have thirty-three days inter
est to pay on it. Who loses by the
three days of grace? No one. Who
gains anything by it? No one.
There are states in which three days
of grace are required on sight drafts.
This custom should be abolished. as
the holders of such drafts, drawn on
cities, where this custom prevails, are
put to inconvenience and loss by it;
but as no one loses or gains by the
three days allowed on notes and time
drafts. 1 can see no good in changing
the custom.
There are several features of the
national banking laws that might be
changed, which would be of benefit
to the national banks.
The first and most important one is
the keeping of per cent. of the cir
culation on deposit in the United
States Treasury. This deposit deprives
the bank of the interest it could make
on it, takes that much money from
the city, where the bank is located,
and does not benefit the general gov
eminent, for ii is amply secured by
the bonds deposited with 1t. by the
banks for the safety of their issues,
and always has more money on hand
than it can make use of.
The Merchants National of this city
has $4,000 deposited with the treas
urer of the United States to redeem
their issues, on which they get moth
ing, and that much money is taken
away from the city, and no one is ben
Gifted.
The law requires a further deposit
from all banks in case the per cent
bonds should sell under par. That con-
tingency has not taken place, and is
not likely to take place, but l think
under any circumstances, the govern
ment ought to give the banks the par
value of its bonds, in bank notes, and
require no further deposit, in case the
bonds should sell under par, as it Ger.
tainly could pay par for any bonds
held to secure bank notes, in case of
the failure of a bank. 1t viii have to
pay par when the bonds mature, and
in case of a bank failure, the bonds
nelQ Oy IldI Ddnk COuIQ De COnSluereQ
as due. This rule would have a ten-
dency TO keep the bonds at par, in my
opinion.
Another singular proceeding, which
never could see any sense in, is the
sending of all bank notes, taken in
at the treasury. back to the banks
that issued them, by express, charging
them with the express freight. This is
a small matter, it is true, but it is some
expense to the banks, and gives some
trouble for no profit to any one.
A national bank note is as good as
a greenback or a silver certificate, and
when paid into the Treasury, should be
paid out again, and kept in circulation
until sufficiently mutilated to require
a new note in its place.
do not think the government should
put any tax on bank notes. Let them
circulate free of all taxation. The gov
eminent does not need the taxes, and
national banks should be allowed every
privilege, and be freed from every un-
necessary expense, in order to induce
them to keep out as much circulation
as possible.
With the above mentioned require
ments done away with, the national
banks would, in my opinion, put more
of their capital in bonds, and increase
their issues-the latter a matter that
would greatly benefit the country and
the banks themselves.
F. I. Mccall.