The Montgomery advertiser., 1904-05-01

were issued with, no other aecurity than taxes that fniEht be imposed but which 1t was fairly obvious the coun- try would De unable to pay; and the depreciation of this currency was so great. and yet so gradual as 1t passed from one man to another, that the final holders lost comparatively little and the whole country breathed a sigh of
 relief when 1t finally. some years after
 the war, became admittedly worth less.
 Such a currency was obviously of
 small value in paying the expehses of
 the war, and in f7so. when the Amer
 ican army was almost on the point of
 mutiny for back pay. the Pennsylvania
 bank came into existence, founded by
 the subscriptions of certain patriotic Philadelphia citizens. This bank. how ever. important as 1t was in forward- ing supplies and money at a time
 when they were greatly needed. was
 rather q patriotic association than banking institution. In i7S2 1t was fol-
 lowed by the Bank of North America, the first permanently organized bank in the United States and the first to have dealings with the national gov ernment. This bank, like the hank of Venice, rose directly from the govern ment's need of money, aul the plan was drawn up by Robert Morris. then superintendent of finance. whose own future was largely devoted to main taining it's credit in the trying days of it's earlier history. The hank. how ever, was not rechartered when the ilton established the first bank of the United States. which exercised cxclu- stve banking privileges and furnlskei a safe and uniform currency until i.s end in 1911 when Congress refusAd to
 renew it's charter chiefly because of popular distrust based upon It's mon opolistic character. The second bank of the United States was not so suc- cessful as an Institution, and it's final discontinuanca was followed. after a period of confusion that many Ameri- cans still. remember. by the present national system under which the banks established in the different States re- celve loans of government money and the United States Treasury stands be- hind the credit of all paper money.
 All this. of course, represents a very much more complicated business than the rent collecting of the old Lombard goldsmith. The banks that now do business for their depositors--the so- called commercial banks--invest in practically all forms of business activ-' tty. Tnelr Vaiue 10 the depOSltor leS in the fact that the board of directors is essentially a group of trained finan- ciers, and these directors. individually and collectively, are in better posi- tion to make investments than could be the average individual citisen. The bankers trust company, for example, representing the latest development of banking in America. includes some twenty directors who are each closely identified either with one of another of the leading transportation lines of the country or with some one of its most important great industrial enterprises. Each of these men, besides being a banker. is therefore also a specialist in one or more lines of investments, and the company as a whole is there fore a remarkable consensus of train ed financial opinion.
 Unlike the individual goldsmith, therefore, the modern bank is in po- sition to combine small with large de- posits in an indefinite number of ways that would be otherwise impossible, and 1t seeks to earn a fair return for the funds committed to its keeping by using them for the making of these conservative investments. The early bankers lived by motto that might be modernly translated, Large and tfn- certain profits with few depositors." while the modern banking business aims directly at many depositors and a comparatively, small profit on safe investments