Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1903-01-23
TELEPHONES.
FOWLER BILL AGAIN.


FOWLER BILL AGAIN.
The Dispatch has more than once d.
rected attention to the Fowler currency
bill as well worthy Of the thoughtful con-
eideration OF our business men and bank
ers. TO the end that they may determine
the wisdom or unwisdom of influencing
their Senators and Representatives in
Congress to support It Our own opinion
Is that while the bill falls far short Of
providing the banking and currency re-
form the country needs. it is a step in
the right direction. AS we see 1T, its ope-
rat;ons could not but in time lead to
further adjustment of the banking and
currency system, to the necessities Of
business and financial transactions and
QUE Industrial Development.
The salient features of the measure
have been several times set forth in these
columns, and ought TO be familiar to
our readers: but 1t will not hurt TO re-
capitulate them. The bill authorizes the
issue, by national banks, of asset curren-
cy-bearing no relation TO the present
hond-issus currency-up to q per cent.
of the paid-up and unimpaired capital OF
said banks. These asset notes Will sup
plemcpt the bond-issue notes allowed un-
der the existing laws. They will be first
lien upon the assets OF the hanks putting
them out, and will be secured by a guar
anty fund of per cent in government
bonds or gold coin, or both. deposited In
the Treasury of the United States Each
bank Is to be subject to a tax of one
fourth OF one per cent. each half year
on the average amount Of its notes in
circulation during that period, the pro-
ceeds to be added to the guaranty fund.
The bill also provides for three redemp-
ton districts with centres at New York.
Chicago, and San Francisco, and a bank
receiving the notes Of another bank out
side of it's district is prohibited from pay
ing them out, but is required to send
them to some bank within the district
to which the notes belong for redemption.
or to hank In its own redemption city,
which would have to transmit them to
their own district The notes issued by
any bank are to be redeemed on demand
the bank Is required to keep the same por-
ton OF reserve for the purpose as Is now
prescribed for the security of deposits.
The bill ON its face, we think COM
n1ends Itself as safe and practical, but if
that view needs reinforcement It Is found
In the facts and arguments that the pa
tron" presented In reporting" the mea-
sure to the House. Mr.. Fowler contends
that with his system of asset issue once
perfected we shall never have any more
OF emergency circulation. For. said he,
every dollar that went out would be just
as "'energsEt" as every other dollar:
and any particular dollar would not be
a danger-signai when the only occasion
Of It's Issue was that it was needed in
the commerce and trade OF the country.
AS to the fear that has been expressed
that the proposed asset currency would
mako money too abundant, and. there
fore. cheap. he gave some interesting
figures as demonstrating that the issue
would respond only to the legitimate de-
mand. and that the notes would not ba
poured out" AMPLY because the banks
would have the power to pursue that
policy. These figures constitute an ar
Eument against the possibility Of re-
dundRnt issue. apart from the fact that
it would not pay the banks not to con-
tract the issue when the business Of the
country ceased TO absorb the surplus.
Mr.. Fowler showed that In France,
where the authorized note issue was
hooeooo.6co. the actual issue was only
tsl4.ooo.0oo; in Scotland. with an autho-
! s,sed issue Of slaS osa.ooa tbs actual issue
vas sao.6oo.oe0; that the first United States
Bank could have issued slo,ooo.peo. while
rs q matter of fact 1t never put out a
note IN excess of ss.oooooo. and the second
United States Bank employed its note
lssue privilege OF ss5.oos.Qoo only Up to
E3.ono 10000. Further. the Suffolk system of
y half century ago in New England had
an authorized issue at one time of Sss-
f0o0en, while It's notes actually put out
Aggregated only saa,Ooaeoo: and the Ca
madam banks. although they may. issue
notes up TO ss5,0to, go, have only ss5f, 1000
300.
Other points brought out in support of
the measure and as sustaining the theory
% elasticity "-automatic operation as
opposed TO redundancy--were these: In
Scotland the average life Of credit.note
Issued by the banks Is only eighteen
fays-that is. the note Is issued as need
%. goes ont into trade circulation. per-.
FORMS its missien. and gets back again for
redemption inside Of three wesks: 81
canada tbs notes remain put on IN ave-