The Washington times., 1903-09-25
No Deposits Should Be
Kept Out of Circulation
When Needed Declares
There Will Be No Dis
turbance This Year.
Exchangeability of Every
Form of Money for the
Standard Coin of the Ma
ton Essential to Sound
Finances.
lspecial to The washIngton TImes.l

Especial to The Washington Times-)
NEWPORT NEWS. Va, Sept. 25.-In
a memorable address Secretary Shaw last
night disclosed before the joint convef.-
ton OF the Maryland and District OF Co
l1moia Bankers Association in session on
board the steamer Norfolk. blowing ,ts
way down the Potomac to this historic
town. plan that will perhaps for many
years preclude the possibility OF a money
panic if put into operation. Equally
important to this announcement was his
declaration there would be no stringency
this year
The substance of his views thus ont
lined is that the reserves held by bank
ing institutions should be available for
use in times OF emergency. He makes
the contention the legal sense OF he
term, reserve, did not require that a
certain per cent OF deposits shuuld be
buried on locked up never to be touched
when the country's prosperity depends
on circulation OF money.
Before eonsenting 10 address the meet
ing Secretary Shaw made a special re-
quest that his speech be not reported.
subsequently,. however. he authorized
the following
Parting of the Ways.
Secretary Shaw expressed the opinion
that We are approaching the parting OF
the ways He said It might be the part
OF statesmanship TO refuse any AMI
every form Of national bank circulation
except that secured by deposit OF Gov
ernment bonds But ii could not be the
part OF statesmanship TO pay OF ths
Government debt and refuse all bank
circulation except that based on Gov
ernment bonds
Either We must issue more bonds as
basis for circulation or provide some
substitute" he continued The present
volume is insufficient The recent de-
mand for $s.O00.OO0 of Government bonds
"a security Cor an equal amount Of Gov
ernment deposits has resulted in advance
ing the price of Government bonds to
figure at which national bank circulation
cannot be maintained at profit
Exchangeability Essential.
There is little to eriucise in our pres
ent currency system as far as II goes
Whatever is added must not be OF a
nature that will cause our people 10
look twice at the bills that may be
presented them in the course OF busi-
ness Exchangeability OF each and every
form of money for the standard coin Of
the country is essential"
Referring 10 the general policy OF
tanking. the Secretary said:
Banks are the servants of the peo-
pie. The banker or the lawyer who
serves his client is reasonably sure OF
success. while the banker or the lawyer
who serves himself at the expense OF
Is client is absolutely certain OF
failure.
The success OF a mine is measured
~ the dividend il pays The success OF
4 railroad or factory is measured. il
art. az least, by the volume OF busi-
ness il does the success OF q bank
should not be measured by the dividend
il pays. as much as the solveney. con-
servatism. and the pronptness to re-
spOnd 10 the legitimate needs OF its
customers"
Available in Emergency.
Reserves which the banks are expected
TO hold. Mr. Shaw further said, should
be available for use in times OF emer-
gency. The term reserve. he said, as
used N the statute does not mean that
certain 9er cent OF bank deposits be
buried, o. locked up. never TO be touch
ed A general who does not approach a
battle. he said. with a strong reserve
ought to be court t-martialed, and gen
eral who does not call his reserve into
action In the thick OF the eight also
ought TO be court Inartialed-
Recent deposits OF public moneys
have net been made. he said. nor has the
offer 70 redeem the per cent bonds. IN
the hope or expectation OF aiding the
stock market. but for the purpose OF
assuring the business men OF >he country
that there Is 10 be no money famine