The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-10-21
Annual ConYAhtiOn of American
Banker Association
Settles Down to the Business O1
ne Session.
PRESIDENTS ADDRESS
He Calls the TOttering Indus
trisl Trusts the Tares
In the Harvest Field of Our
Commercial Prosperity.

San Francisco, OcI. Sl.-lAe ACTUAL
business of the twenty-ninth annual
convention of the American Bankers
association began this morning when
the delegates assembled in the Califor-
MIA theater. The auditorium of the
theater was comfortably Allied. The
theater and stage were handsomely
decorated with flowers, evergreens and
ferns. President CardwelI Hardy, in
calling the convention to order, said:
THE unprecedented prosperity of the
past few years brought us last fall to
a climax Of high prices for commodi-
ties and securities. The same sunshine
which brings to its full fruition our
rich harvests also fosters the tares. So
among the substantial ediaces of our
prosperity have sprung up artificial
commercial structures which have
failed signally to stand the test of time
Over-sanguine people, some probably
not over-scrupulous, had been capital
izing and recapitalizing schemes of all
kinds and inducing people with paper
profits TO underwrite f1otations which
they were unable to carry. The boom
had gone too far. the natural reaction
set in. and a general house cleaning
begun where it was most needed, in the
weeding out of over-capitalization and
inflated securities.
We have gone through period of
liquidation in speculative circles of the
most drastic character, without results
except to the few who have gotten too
far beyond their depth. The process
is not yet complete, and the way is
stil strewn with cripples and indi-
gestible securities, but general busine IS
conditions are sound.
Let US review briefly the attitude
and relation of some of our banking in
stitutions to the conditions and Incl
dents referred to, and the methods pur-
sued by them in the prosecution of
their business. 1 refer especially to the
vicious policy of paying rates for de-
posits. particularly savings and time
deposits If there is any class of men
moro than others who should never
take speculative risks 1t is those who
are handling the earnings and savings
OF Others and the seeking OF deposits
at high rates of interest, which can
Fnly be earned by speculative invest
ments, is a menace to sound banking
savings depositors should carefully
shun such institutions. of which there
are however, happily but few.
The vast majority of us feel assured
we nave, so far. all the currency we
have needed and that an increase of 1t.
Just at this time would lend a further
nndeslrable u. stimulus to speculation.
Ine enormous production of gold In the
last 1ew years has been either lost sight
OF or II studied will furnish food for
thought The advantages Claimed for
over our bonds secured notes. hay.
much merit from a scientific standpoint
II tie element of risk could be eIfroi-
mated which has brought disaster in
some instances. The practical question
is, could 1t be satisfactorily grated on
10 our banking system, and il So how9
The idea of q Ger trail bank or a branch
banking system is repugnant to our con-
cep0lon OF free government and instiru-
tions. and. unless mistake the temper
Of our people, will never be accented
Neither will any form of currency be ac-
cepted which does not carry with It the
bank notes now enjoy
A consideration of our present de-
Velopment and conditions would not be
complete without reference to our cor
porations of the present day
In the formation of our great indus
tfaai corporations. we have been con-
Ironted with new and strange condt-
IONS Illuminating those of a fraudu-
lent or fictitious character. nearly all or
them have been subject to criticism in
the matter of capitalization. and the
weak point with all of them has peer.
working capital
There has been a greater creation Of
securltles IN the consolidation OF ruanv
OF our railroads than actual values. an
paFentIy, Justify, but the consoIidatioy,
of management and control has bro1Iehf
about stability of rates which has
created an established value for thai,.
1SSltAihdte securities without hardship
to the patrons of the roads 1t is a SER
3ouS question whether the aggregate
market value of all our railroad secur-
1ties equals the amounts originally ex-
peaqeu IN the construction Of them
with even moderate return lpon the
Investments"
THE reduction of the cost of trans
portatlon has made it possible to move
prohtaply al rates which would have
formerly considered impossible. 7 do
not mean to suggest that the roads
should be left entirely free in the mat
ter of fixing rates, but the reasona ble
concentration of their management
should rather facilitate their control in
this respect by conservative legislative
enactment The enormous increase of
business developed by our prosperous
condition has so oVertaxed exciting IA
cilities as to necessitate extensive i'm
provements, which have brought the
roads into the market with borrowings
which have seriously taxed our resour-
ces. but. where these improvements
have been undertaken on a legitima te
basis, there is apparently little reason to
npprehend any difficulty in carrying
Them to a successful completion and
utilization.
"A word on publicity as it relates to
all public corporations. Some criticism
mas recently been made of the publica-
ton of the weekly New York bank
statement. I use the incident merely to
point moral The form and method of
making this statement has been more or
less a subject of discussion for some
time past. If the form and method OF
publication is not as accurate as ii
should be, make it what it should be
but DO not suppress it. The publication
occasionally, of an Individual bank
statement, which it subsequently devel-
ops is not legitimate. would be a poor
excuse for the suppression of bank
statements in general and I think a
suggestion that we do away with bank
statements would be unanimously We
ted. Bank statements in general con-