Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1906-11-02
We Med MORE MONEY
That Is. the Opinion of a Noted
London Banker Who Has
Been In America
l SEES GREAT PROSPERITY
E. II. Holden, Head of London City
and Midland Bank, Returns to Eng
land With the Story of Our Prosper
ity-Thinks America Needs Greater
Volume of Cash.

London. Nov. 2.-E. III. Holden, head
of the London City and Midland bank,
one of the most powerful English
financial organizations, has just re-
turned from a tour Of the United
States. where he was much impressed
by what he characteriZes as the great
general prosperity that he believes
had its origin In. the bountiful harv-
ests Of the last few years.
Asked whether trade activity or
speculation was the primary cause OF
New York's recurring financial strin-
gency, he declared himself strongly of
the belief that it was the trade ac-
tivity coupled with an imperfect bank
ing system.
This system, he declared, caused a
periodical lookup in the United States
treasury of liquid FUNDS when such
funds were most needed not only in
the actual money market but for Or
binary necessities at the leading
centers.
He added: "All cities in the United
States are exceptionally prosperous.
Wherever you go you find business ex-
tended Especially is this true of Chi
cago where business naturally requires
u great amount Of extra capital. l
had interviews With two or three pres
idents of Leading railroads, learning
that they We're extending, electrifying
and buying new equipment from cur
rent revenues or past accommodations.
obviously these demand the with
drawal of large sums from banking
institutions, SO that whereas they re-
Gently held big deposits of railway
funds they now have loaded these de-
ais for increasing general business
prosperity and for harvest operations.
Thus it happens that where two years
ago the associated banks held some
thing like $5S,00000O of surplus rev.
enue to meet harvest requirements
over the legal Is per cent, last year
they held only $12.000,000. and this
year the surplus reserve practically
is Nil.
Thus they ran against the law stip-
ulating that % per cent of deposits
must be held in cash, but happily the
secretary of the treasurer came for
ward and lent sufficient funds to put
the banks right until they could ship
the necessary gold from London or
elsewhere. This they did, promptly, to
~ 0f
pounds of sterling"
Need Of More Money.
Mr.. Holden said that he found Lead
ing New York financiers strongly OF
the opinion that Immediately at the
turn of the half year money will be-
come so cheap that exchanges will rise
to the gold poin and that England then
will get back all the gold she has
shipped to America. From this view
he d ffers, believing that the American
population is increasing so rapidly that
an Increased circulation medium will
be necessary. Moreover, in travelling
about the country, he said, he was i'm
pressed with the great amount of gold
used in manufactures. AS the country
grows, he said, more and more gold
VIII DE IC'IuIiGd.
MI Holden said that having regard
to the Increase in population, increased
prosperity and amount of wealth COM
ing out of the ground he does not be-
lieve the proportinoate speculation III
stocks in New York is as great as 1t
used to be and that he does not believe
present New York speculation serious
ly will hurt eitner the New York mon
ey market or America itself.
He suggested to the bankers that he
met in New York that safe course to
pursue would be for banks in Chicago
and ST. Louis 10 keep their reserves in
their own vaults. This he thought
would lead to contraction of New
York reserves and prevent to a con-
siderable degree the assistance now
given to speculation. He added that
his arguments were overruled because
country banks now receive 2 per CEN.
when a portion Of their reserve is de-
posted for New York. whereas if the
entire reserve were retained at home
this 2 per cent would be lost.
UNTRUE; THREE DIE.