The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-12-02
FOWLER SCORES
ROOSEVELT IDEA
Chairman of House Committee
on Banking Not in Accord
WITH Administration Plans.
MAY LEAD TO INITIATION
SUGGESTION OF HIS OWN PROP.
OSITION.

New York, Dec. Chairman Fowl
er of the house committee on banking
and currency made the following
statement today respecting the out
look for financial legislation in the
Sixtieth congress:
There certainly should be some re-
medal legislation, and l can assure
you that the members of the commit
tee on banking and currency will bend
their energies 10 that end. What we
shau be able TO accomplish no man
can answer But that there is urgent
need for help no man can deny.
At the dinner of the American
Bankers association at st. Louis a
year ago, l predicted that the thing
which has happened must happen I'M
less some Immediate action was taken;
that there was not a banker in the
United States who would not regret it
II something was not done.
AT the close of the last session of
congress l said that the condition of
our finances and currency was such
that it would of necessity lead to the
destruction of our prosperity.
- Treasury Manipulation.
Again l now declare that if this
government continues its present poll
cy of injection into the arteries of
trade and commerce a fixed bond-Se-
cured currency-by exchanging securi-
~ by bond speculation, by treas
ury manipulation. by executive or
der or by any other form of
thimble-rigging, we shall continue to
move, but with greatly accelerated
compared with which the present
manic il only T1Iaa Mt Srrr17r1aa,- ont
ing. Our condition this fall has been
one of real prosperity. Our crops are
worth about 81, 900 600, 900; the products
of our mines about 81 400 900 900: our
manufactured products about $1,000, :
600, 090-a total of SOS, 600, 000, O00
Meanwhile, we have had the adVan-
tage of an extraordinary consumption
of foodstuffs, and are enjoying excep-
tionally high prices. If all this were
not true, but on the other hand our
business conditions had been bad, sour
crops poor and foreign prices low,
imagine what would have transpired.
MaIadministration Of Finance.
Notwithstanding all this. and who'll
~ because of the maladministratiOn of
our finances, we are in a state of
panic.
we have today in the banks of this
country about S12, 0O0 co., 900 of deposits
and about the same amount of out
standing loans.
Against this fabulous sum the banks
hold as reserve about 5000, 600, 000 or
less than 8 per cent. And even of this
s per cent reserve nearly one-quarter
$500. 10000 is bank nOtes-a mere
credit, a mere promise to pay.
Stating it in another way, the re-
serves held against s., 500, 600, 900 of our
hon =. 4OTa kay l.
and not gold. which is admittedly the
only proper reserve in any country
with a gold standard.
Worst Form of Imitation.
Yet, if we continue our present poll
cy. where is it going to end? Not long
Will ii be before all of our bank de-
pOsits will rest upon credit reserves
This is obviously the worst and Wild
est form of imitation. Yet il is rumored
that sheer madness is to follow; that
a scheme is now being wrought out to
add 20 this already overwhelming bur
den another load in the form of state,
municipal and railroad bonds as the
basis of our bank currency. Liability
including bank notes, should be gold
Yet, amazing as it may seem. at the
annual meeting of the American
Bankers association a year ago, a re-
solution was introduced declaring that
a national bank note. being secured by
government bonds, was just as good
reserve as a greenback, and the green
back is a lawful reserve. But this is
begging the question, because the
greenback itself is only tolerated as
reserve because the government stands
ready at all times to redeem it in gold.
The security for the national bank
note, on the other hand, is a . per cent
government bond. payable twenty-five
years hence. which. as an investment
based upon its rate Of interest would
sell for about So cents on the dollar.
Its aresent price is due 10 special de-
mand for it as security for the bank
note issue.
Adding to the Burden.
ITO suggest as a remedy for our
financial trouble that we add TO the
already existing burden of about $780,
060. 600 OF bond-secured bank issue. and
unlimited amounts of bank notes based
upon state, municipal or railroad
bonds, will prove the last straw. 1t
viii still further force gold out of our
reserve and out of the country.
Continued on Page 2.