The gold leaf. [volume] (Henderson, N.C.) 1881-1911, 1907-11-21

The Volume Of Money Has Not In
creased in Proportion to the I'M
mense Volume of Business.

Mr.. D. A. TOmpkins, an expert
financier, of Charlotte, has been
! writing a number of articles iii the
Charlotte Observer, from New York,
on the money situation. Below We
give part OF a recent letter showing
the need of more money and the
need of all elastic currency, that will
go out in times like this and come
back in times of abundant currency.
Says Mr.. Tompkins:
I'm latter years the United States
has been very prosperous. Wages
have increased, the value of all farm
products has increased and every
! thing which money buys has increas-
ed. While these changes in values
have been going On the volume of
money in the country has had no pro-
portionate increase. 1t used to take
$25 to $50 in cash to pay for q bale
of cotton. Now it takes $50 to 500.
Three hundred million dollars used
to handle the crop. Now it takes
more than six hundred million. Here
in New York, | am told, it. takes sixty
thousand dollars day to pay street
car fares on the Metropolitan or In
terborough railway, ii that's the
right name for the combine. A few
years ago no such amount was re-
quired. Prosperity has increased
| the riding on the street ears and rail-
| way trains all over the United State
and it requires more cash. Wages
are greater and require more cash.
ain the face of this situation and
in the very midst of an abundant
| prosperity timid people lock up and
| hide away the currency.
High priced cotton and good
wages make a good condition. In
times like these when times IRE good
| but only ready cash is short every
body ought to put mon,y in the
banks to keep the good prices up.
Taking money out OF circulation
tends to depress prices and wages
| and whoever does it is contributing
to break down the good prices for
farm products and good wages.
Its a little like the shipwrecked
man who saw water everywhere and
not one drop to drink.
"There is abundant property and
| good business and the trouble is
| shortage OF actual currency and this
is due to the action OF those who
lock it up or hide it and take it out
of circulation.
"The Congress will probably amend
the banking law so as to allow the
banks to issue currency in times OF
panic or pressure to take the place Of
| that which is taken out of circula-
| tiOn When that is done we may
have squeezes but not disastrous
| panics where firm or corporation
doing good business has to shut
down because it cannot get the cur
rency to pay wages, buy and pay for
| farm products and otherwise keep
| agriculture, manufacturers and COM
merce moving.
"On the subject of an elastic cur
rency the st. Louis Globe-Democrat
says:
"'The present tension shows what
has often been shown before, that our
currency system needs little more
elasticity than it has had in the last
third OF a century. 1t does not re-
spond quick enOugh to new demands
for additional circulation. In a Ger
tain degree clearing house certificates
supply this lack. But this emergency
currency is available only as a means
of meeting the balances between the
| banks.
"'Some sort of an emergency cur
rency, however, may have to be
adopted which will be available for
us among the people. Many plans
for creating this sort of currency
have been suggested. The subject is
difficult, as is shown by the fact that
bankers and financiers in general
differ as to the sort of currency
which would best meet the demands
of a situation like that through which
the country is now passing.
"'Currency which will expand when
the need arises and contract when
the occasion ends, and which will be
safe at all times is what the country
requires. This is subject to which
our fnanciers and statesmen should
give immediate and intelligent atten-
| ton
1.-The Globe Democrat is mistaken
as to the difference between bankers
and students OF the subject. The
| truth is that the argument is we'll
nigh unanimous. Mt the bankers
convention in Atlantic City plan
was proposed which was practically
only opposed by one man. The plan
proposed at Atlantic City is not only
supported by the bankers, but also
by business men generally who have
studied the subject.
| But whatever value may come
from an asset currency when author
lied by law, such value is not availa-
bic now. In the present situation
the next best thing to u national
bank asset note is the clearing house
certificate. clearinghouse certifi-
Gates give q practical emergency cur
rency; not particularly authorized by
law, but then not at all forbidden by
any law. They are not issued by
banks but by clearinghouse or any
association of banks.
'The clearinghouse is very good
| institution for cities where there are
a number of banks at any time. 1t is
seen how they can help in panic
but when there is no panic they do
much to facilitate the business of a
| city and to make bank transactions
| safe"