New-York tribune., 1907-10-25
CLEARING UP.

The banking situation has been greatly re-
Iieved through prompt cooperation between
the Secretary of the Treasury and the chlei
representatives here of conservative ana repu-
liable finance. There may be few further uls-
closures of weakness by small INSTITUTIONS
caught without sufficient reserve tuhdS, Dul
il seems reaSona BILE to assume that the Crisis
of the last few days has been successfully
passed and that banking operations can soon
be resumed Oh a normal basis. The temporary
furry has shown that certain bubbles had TO
he nrickod and certain dangerous influences in
local banking had TO be eliminated. 1t was
bettor 10 have corrective treatment applied at
once and thoroughly than TO allow abuses 10
spread and become infectious. If the ordeal
disclosed some Unsuspected weaknesses. lt hih
the good effect of proving the stability ana
solvencv of the great mass of our banking in
stitutions and thus assuring the public that
conservatism is still the common rule in the
conduct of the machinery of exchange and
credit.
Grateful acknowledgment is due to the lead
erS who checked what might have developed
into an IRA tional and devastating panic. The
Secretary of the Treasury appeared on the
scene at the proper moment and without hesita-
ton offered the aid of the government in tOrti-
fving credit and replenShing local bank re
serves Mr.. CortelyOu had taken the precau-
ton early in August 10 deposit funds in all
the Western money centres to be used in NOV
ing the crops. and had thus relieved New York
of a drain which might have proved highly en-
barrassing al this iuncture He knew that the
cOuntryS financial condition was exceptionally
sound and that the trouble here was purely
local and could be only temporary. He there
fore wisely gave the fullest support Of the
Treasury to the movement to check hysteria
and restore sanity In the bankers with whom
he co-OpPrated he found worthy allies They
have done many public services of great i'm
pOrtance and stand ever ready TO do others in
the way of defending credit and maintaining
the highest standards of business probty. New
York is fortunate in having such financial lead
erS-men who know how 10 lead and whose
leadership inspires respect and confidence.
Every disturbance teaches IFS lesson. and the
lesson learned in the last few days will prove
wholesome. Eternal vigilance is the price not
alone Of liberty but Of solvency We need
more efficient inspection of banking institu-
tions and banking methods The national gov
ernment and the state government should each
try to enforce an inspection which really in
Spects But self-heIp is better than help from
the outside. and the banks can protect them
selves from abuses Of credit and adminiStra-
tiOn hetter than any outside governmental
agency can perform that function. The Clear
ing House is the best vigilance committee t.
pursue those who try 10 profit through banking
abuses. Its drastic action and its pledge that
all the banks in its Jurisdiction were solvent
turned back the pressure for liquidation far
as il affected Clearing House banks The trust
companies would have escaped much cmbar-
rassment if they had been able in the same
way at the first critical moment to show
united front and could have used their con
certed power to punish abuses as well as to
remedy them. The formation of a trust
pany clearing house or the re-entry of the trust
companies into the bankers Clearing House on
equitable terms is 10 be- commended as a COM
mon prpcaution. Either arrangement
ought 10 exert a powerful influence for good
in steadyinG the trust companies and putting
them on n securer and healthier basis.