The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1906-12-06

ment also to protect the people against
financial panics, which, in this country,
haye caused more mental and more
physical suffering than all the plaques
known to man, and recognizing that un-
der our system no posslblo CO operation
can be secured among banks, each IN
dependent of the other, and finding
these institutions In the interior send
inc their money to be loaned on call in
the cities. and the reserve of the coun-
trv even in the idle season. very low,
the Secretary of the Treasury under
took the task of making some slight
provision for the inevitable. He with
drew from the channels of trade $780,
O00. 900 and locked it up. This was ac-
cunlulated in part BY excessive revenues
and in part bv deliberate and prcmedi-
tated Withdrawals. His only excuse for
withdrawing the peoples money when
they did not need it, and when its pres
ence invited speculation, was to have
il ready 10 restore when they did need
II. and when its absence would bring
certain disaster
Can Cooperation Be Enforced?
whether cooperation can be Sc
cured by statute is n question on which
students Of the situation will Of course
differ. | suggest for the consideration
Of Congress t1o possible plans; First,
graduated reserve, determined by
statute The objection to this plan is
that conditions vary with different sea-
sons Sometimes the crisis is deferred,
and occasionally the most stringent sea,
son is during the spring. Second: bet
ter plan, in my Judgment, would be to
clothe the Secretary OF the Treasury
with authority to require all banks, at
certain times fixed by him, to slightly
and gradually increase their, reserves
and hold the same within their own
vaults, with corresponding authority TO
release the same from time TO time as
in his Judgment will best serve the
business interests of the country
"In quarantining against yellow
fcver, the Government grants great
latitude and well.nigh unlimited dlscre-
tion to the. Secretary of the Treasury
through the Marine Hospital bureau.
Actual experience iOstiies the state
ment that the American people hold me
Secretary of the Treasury quite largely
responsible for financial conditions,
This being true. he should have that
measure of discretion and authority
requisite TO enable him to fulhll this eX-
pectation Can he not be trusted as a
fnancicr as well as in the capacity OF
an expert health officer!
Question of Reserve.
"Suppose the national banks were re-
nujred either hv statute or by direction
of the Secretary of the Treasury 70 in
crease their reserve, and 10 carry the
same in their own vaults III an amount
equal to | per cent of their capital
stock every fifteen days from the first
dav of April to the first day Of Sep
tember. This contraction under ordi-
nary conditions prevailing IN these
months would work no hardship upon
any institution, and would result in the
collection of SsO,000.000 of reserve
money with which to meet the demands
of increased business. 1t ia probable,
and under ordinary circumstances well.
nigh certain, that the banks would find
such a contraction profitable, for the IN.
terest rates during the summer would
not be likely to drop excessively low
and it is equally certain that the rates
would not be dangerously high in the
fall and winter
'sIt may be said that the banks can
now strengthen their reserve during the
summer on their own motion. The best
answer to this is the admitted fact that
they do not do it to any considerable
extent and for the reason already
pointed out-want of cooperation. NJ
one bank, nor the banks of any one city
will contract their reserve when al
other banks are loaning the last avail
able dollar at the rate obtaiuable, how
ever low that rate may be-