Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1906-12-04
pEsEREr EVENING NEWS TUESDAY DECEMBER 1906

II even at high rates All commercial
interests suffer during each crop period.
Excessive rates for call money In New
York attract money from the interior
banks into the speculative field; this
depletes the fund that would other
wise be available for commercial uses,
and commercial borrowers are forced
TO pay abnormal rates; so that each
foil a tax, In the shape OF Increased
interest charges, Is placed on the whole
commerce of the country
The mere statement Of these facts
shows that our present system is scri-
ously defective. There is need OF q
change. Unfortunately however. many
OF the proposed changes must be ruic
from consideration because they are
complicated. are not easy OF compre-
hcnsion. and tend TO disturb existing
rights and interests. We must also rule
out any plan which would materially
impair the value Of the United States
per cent bonds now pledged to Sc
cure circulation, the issue of which
was made under conditions peculiarly
creditable TO the treasury. | do not
press any especial plan. Various plans
have recently been proposed by eX-
pert committees of bankers. Among the
plans which are possibly feasible and
which certainly should receive your
consideration Is that repeatedly brought
TO your attention by the present secre-
tary Of the treasury, the essential foa-
lures Of which have been approved
by many prominent bankers and bust
ness men. According TO this plan ma
tionn banks should be permitted to
issue a specified proportion of their cap
tal IN notes OF a given kind. the issue
to be taxed al 80 high u rate ms ~
dr..e the notes back when not wanted
in legitimate trade. This plan would
not permit the issue of currency To
give banks additional profits, but 10
meet the emergency presented by'times
of strlngency.
Do not say that this is the right sys-
tenn. | only advance 1t Ia emphasize
my belief that there is need for the
adoption of some system which shan
be automatic and open to all sound
banks so as to avoid all possibility OF
discrimination and favoritlsm, such a
plan would tend TO prevent the spasns
of high money and speclila lion when
now obtain Ia the New York market.
for at present there is too much cur
| rency at certain seasons or the year
aud its accumulation at New YORK
| tempts bankers to lend L az low rates
| for speculative purposes; whereas at
| other times when the crops are DeluS
moved there Is urgent need for larga
| but temporary increase In the currency
| supply, 1t must never he forgotten
! that this question concerns business
! men generally quite as much as bank
| ers: especially is this true OF STOCK
| men farmers. and business men IN the
west; for at present at certain seasons
/ OF the year the difference IN inters'
| rates between the east and the west i
| from 6 to 10 per cent, whereas IN Can
ada the corresponding difference If
but . per cent ANY plan must OF
course, guard the interests OF west
| ern and southern BANKERS as carefully
as it guards the interests OF New Norf
or Chicago bankers; and must De
drawn from the standpoints of th'
farmer and the merchant no less tnai
from the standponts OF the city banker
and the country banker.
The law should be amended Sc
as specifically to provide ina
the funds derived from eustott'
duties may be treated by the sec
retary of the treasury as IN
treats funds obtained under th'
internal-revenue laws. There SHOULD
be- 2 considerable increase I'm bills OF
small denominations. Permission SHOULD
be given banks. is necessary under set
tied restrictions, to retire their err
| culation to a larger amount than thre'
| millions n mont h.