Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1906-09-13
SHAW'S WARNING
Public Moneys III Depository Banks
Not to Be Loaned for Specu-
lative Purposes.
MUST Be KEPT At HOME,
Deposits Are Made I'm Aid of Legit-
innate Business ms Distinguished
From OBSERVATION-DISCLOSURES De
Loaned Mt Regular Rates.

washington. Sept. s.-Secretary
Shaw has made public circular let
ter dated Friday to all national bank
depositaries In which he says In effect
that he expects public moneys In de-
positary banks to be used in the COM
munities where It IL deposited and
not loaned through brokers and other
agents In New York for for specula-
tive purposes. The letter 10 as fol
lows:
Il am advised that many banks.
scattered throughout the country, are
loaning their surplus FUNDS, through
brokers and other, in New York on
call, at high rates Of interest. Money
loaned on C..ll is we'll nigh universal
ly for speculative purposes. recog-
uize the right of any individual to
speculate In stocks or In lands, and
The legal right of any bank to loan
money at appropriate rates Of interest,
at home or abroad, ON ample security,
even with knowledge that It Is being
used for speculative purposes. ! am
not willing, however, that government
money shall be enticed away from the
locality where 1t has been deposited
for the purpose Of being used In this
way. Public deposits are made In aid
of legitimate business as distinguished
from speculation whatever Its nature.
Depository city banks are expected to
loan at regular rates or not at all and
they must not be tempted to act as
agents instead Of correspondent for
other depository banks in making call
loans at high rates.
III you have more money than your
community can appropriately absorb,
please return 1t to the treasury for 1t
can be promptly placed where 1t will
do much good. This does not apply
to banks with large reserves regularly
on deposit with city correspondents"
Kansas City, Sept. ST. do not
see how Secretary Shaw can ascer
tain whether government money on
deposit In national banks Is lent In
Wall street or not" said Kansas
City banker, when the circular issued
from the treasury department was
called to his attention Friday.
Doubtless many western banks are
lending moderate sums In New York
on call to take advantage Of the
present high rates. But they are not
mountaineering home borrowers in
so doing. They are lending only q
portion Of their surplus. In New York,
however. the big banks have 90 much
money lent on collateral for specula'
tive purposes that merchants and
manufacturers are forced to pay high
rates, also.
Interest rates to-day are lower at
western financial centers than In New
York, and, therefore, Secretary
Shaw's advice to interior bankers
seems out Of place. II the secretary
Of the treasury wants to discourage
the excessive use of banking funds
for speculation ON Wall street he
should let the big New York bankers
understand that when they get in a
pinch they cannot depend on the treas.
ury department for aid. It seems
the height Of absurdity for the secre-
tary to advise western bankers not to
lend money at high rates on Wall
street, and at the same time permit
New York banks to borrow govern
ment gold, without interest, pending
the importation Of the metal from
abroad"
Charged with Territory Murder.
Ardmore, l. T., Sept. Federal Of
ileials lodged John Brown in the
federal jail Thursday charged with
he murder Of M. Swancy, which oc.
CURED wednesday at Loves Valley.
Brown is a land man and 1t IL alleged
hot Swancy in self defense. The de-
,eased was a prominent farmer.