The Cairo bulletin., 1907-11-27
COUNTRY BANKS
WILL Be FIRST
TO GO UNDER WHEN DiSTRUST
IN BANKS BECOMES
GENERAL.
SHOULD QUIT BOARDING
Ard Let Money Circulate Says A. 8.
stic&ney-Urses Bark System
Similar to That Practicsd
IN Europe.

i 49, sthtt ~ sN ~ NtAljNA
problem ana proposed financial legis
lation was discussed tonight before
the Original Roosevelt Republican
club OF st. -aul by President A. n
Stickney of the Great Western IA
way; Senator Moses Ii, Clanp ane
Congressman Frederick c. Stevens.
The principal address was delivered
by Sticlmey, who said
The prosperity Sof production On
the farm ia the mines and factories
requires that the distribution of these
products through the channels "a
commerce shall be continuous, aud
such continuous distribution cannot
be accomplished without continuous
production Of bank credits, which are
the essential part 6f such commercial
transactions.
Continuous Bank Credits.
Hence the commerce Of this coun-
try demands that the antiquated pri-
mary banks now in use Should be
displaced by q modern system OF
banks. which can and will Issue every
day in the year and every hour OF
the day all credit which commerce re-
quires, exercising no repressive
measures to reduce the volume CT
such credits, except by raising the
interest rate, 50 that every legitima Q
merchant throughout this vast ccIn-
try can feel assured that. as long as
be keeps his business solvent and en-
titled to credit, he can obtain all the
hank credits 10 conduct his busine So
REQUIRED BY paying the interest rat \.
Such ia system new exists In every
commercial nation except the United
States and has been tried and been
proven through all commercial storms
81 the last century, and has never
failed.
Economize Gold For Reserve.
''The purposes of the organizatic
CT a modern and most improved bank
ing system. are, first, to economic
in the Use Of gold required for re-
serve because gold is expensive and
difficult to obtain. and, second, to
amass it In such quantities, and hold
1t in such way that every customer
Of the bank he's got it and that it and
that ii is really available to meet all
demands for gold which will be made
upon the banks.
Banks Too Inde eoendent.
&f "a F1y.f
part OF whole plan connected in
such a manner as to create a chain
of mutual support. but they are local
and Independent institutions. In
times of commercial crisis each mus
depend upon itself and 1t is evident
hat cne bank, without the co-opera-
lion OF other banks, cannot support
he enormous credits of commercial
lation like the United States. Each
begins to scramble to increase its
,ash reserve at the expense of other
banks
"Srch conditions now exist among
he country banks. Each country
lank Is horading all the money it can
get hold of which produces short
less Of money In circulation.
Too Much Hoarding.
Beyond question there is sufficient
circulating currency represented by
iotes in this country, If allowed 10
.irculate, to supply all the demands
# commerce. At present the appar
mt shortage is due entirely to the
iountry banks boarding it and refus-
ne TO allow it to circulate
"UnQuestionably, money which
,snally circulates rom bank to bank
md from banks to the people. and the
)eople to the banks-mcney which.
nder normal conditions, pays pay
oils and petty bills. is now boarded
IA from ten to fifteen thousand coun-
ry banks. and relief from the present
itagnation will come only when the
.ountry banks return such money to
circulation.
First 70 Co Under.
III they can get the courage TO re
urn their surplus money TO circula-
ion. before conditions get 50 bad as
o alarm their cwn depositors. all
gould be well with them. but II on
he other haEd they continue to h@id
n until general distrlst of all the
ianks Is produced. the very country !
.aaks which are now hcarding the |
scney viii he the first to go to the I
gall
Such conditions would be impos /
ible ii the banks Of this country +
ecre amodeIn system Of banks
"The uHseemly scramble after
money to maintain reserves is never
witnessed in any other commercial /
alton. because all commercial ma
icns except the United States have /
vstems cf banks 50 connected that
ach bank constitutes a mutual sHp-l
crt to every other hank
System Abroad.
Stickney then explained the sys-