The Washington herald., 1907-10-21

New York. Oct. 2o-In clearing house
circles tonight feeling Of contentment
and satisfaction succeeded the foreboding
created by the sordid disclosures in the
banks In which the Heinzes, the Thorn
asses, and Charles W. Morse were officers
Every banker important in clearing
house circles was entirely satisfied that
the clearing house had completed the
work Of purging thoroughly and well It
had driven out Of control Of clearing.
house banks the elements that We're con
sidered unsound and unsafe, and had
vastly improved the banking situation by
relieving it Of slsyrocket banking.
Moreover. bankers were unanimous in
the belief that they had done their work
in time TO save all the banks in which
the loose banking methods were prac-
ticed. Not only had they done it in
time, a banker said tonight, but they
had done it In abundant time.
They had taken rigorous and drastic
action at a time when the solvency OF
all the clearinghouse banks was abso-
lutely assured. Therefore, after one Of
the most important meetings in the his
tory Of the clearing house-a meeting at
which there We're present a remarkably
large number OF sound and responsible
bankers. and at which every phase of the
situation was discussed with the utmost
thOruughneSs-theb bankers decided 10 sup
port the National Bank of North Amer
lea, the New Amsterdam National Bank.
whatever other Morse banks might need
assistance, and the Mercantile National.
4 thorough examination OF the iustitu-
tons had then been made. and the ex-
aminers reported them solvent beyond q
doubt The official statement Of the de-
cision was expressed as follows:
"A committee of the clearing house has
examined certais banks of the asspriatiou
that have been under criticism. and finds
them solvent The clearing-house com
mittee has decided TO render them such
assistance TO meet their deposits as the
committee may think necessary"
Before this decision was given out. III,
process OF eliminating unsatisfactory fac
tors had been completed. Ia the place of
+. Augustus Heinze. as president Of the
Mercantile there had been selected Seu
N. Milhken. a sound. responsible anl
wealthy merchant. The Thomases na,
given notice OF their resigna lions from
the boards of the two cle1riug-hous,
! banks IN which they We're directors. aut
had not only resigned all other bankiul
( offices held by them in this city. but ha,
announced the sale Of their holdings r
the only two banks they controlled O. F..
IN the Consolidated National. and +. r
Thomas in the Hamilton Bank, resigned
respectively as presidents Of the two iu
stitutons. These banks are small con
Germs, not members of the clearing
house, and the clearing house committee
had not bothered about them. Neverthe.
less, the news Of the Thomas elimina.
tiOn from them was welcomed
Return Of Loans Demanded.
In the case Of Mr.. Morse, also. the
process Of elimination had been completed
by tentative arrangements for the trans
fer Of stock control in his banks. and the
election Of a new president in the person
Of w. F. Havemeyer at the National Bank
Of North America. MI Morse struggled
hard TO avoid the fate in store for him.
but all his efforts We're futile against the
strong, determined and commanding atti-
tude of the clearing house bankers. Plans
for the transfer of stock holdings We're
complicated by the fact that so much. if
not all the holdings are hypothecated
in various banks for loans
The gist OF the situation is just this. '
a tanker said tonight. The clearing
house has declared, and has enforced the
decree that persons who buy stock con-
troll in banks. put the stocks up as col
lateral for loans in other banks. and bor-
row the deposits Of the banks thev and
their associates control in order 10 float
their corporation schemes. such persons
shall not do business under clearinghouse
auspices in This city. The persons now
detected in it are the first persons who
ever got into the clearing house to par-
petuate such acts. They were the. FIRST
and viii be the last"
In connection with the loans from
banks. the clearinghouse committee he
fore il would announce further aid IN
the mercantile bluntly and hatly told
the Thomases. MT Heinze and Mr.. Morse
that they must pay back their loans IN
that institution. There was no euuivoca-
ton about it. They must pay them. too.
If they had to sacrifice their securities
at an even lower range Of stock market
prices than exists at present.
ThOmaSeS Become Abiect.
The attitude of the Thomases in the
presence Of clearinghouse bankers. it
was said. was almost abject, to the point
of exciting sympathy were the circum-
stances different Actually. IL excited rili-
cule. They seemed only too anxious 10
find people to take their bank stocks off
their hands, and promised most emphati-
cally to DO what they We're told.
Mr.. Morse assumed a more digni6ad
position. lie insisted, both at the stormy
meeting in the Bank Of North America
Saturday night and at other MEETINGS
to-day, that he was worth $11. 900. 900. even
if liquidated at present prices. The retort
came easily that. if this were the case
Mr.. Morse should have no difficulty in
paying off his loans. Mr.. Morse insisted
that he could that his loans were amplv
secured. and that he ought not to be
obliged to sacrifice his holdings in the
present depressed condition Of the market.
With F. Augustus Heinze. bankers de-
clared, the question Of payment Of loans
seemed entirely matter Of ability 10
do so, his case in that respect more
,ro f-,-,,,o.. S,,,r.-I.-