The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-12-04

In my message to the congress a year
ago ! spoke as follows of the currency:
= especially call your attention to the
condition of our currency laws The
national bank act has ably served q
great purpose in aiding the enormous
business development of the country. and
within ten years there has been an in
crease in circulation per capita from
S2l.H to S33.0S. For several years evil
dence has been accommodating that addi-
tiOnal legislation is needed. ThR reCUT-
renee of each crop season emphasizes the
defects OF the present laws. There must
soon be a revision of them, because TO
leave them as they are means to incur
liability of business disaster. Since your
body adjourned there has been a fluc-
tuatiOn in the interest on call money
from , per cent to 30 per cent. and the
fluctuatiOn was even greater during the
preceding six months. The secretary Of
the treasury had to step in and by wise
action put stop to the most violent pc
riod of oscillation. Even worse than such
fluctuatiOn is the advance in commercial
rates and the uncertainty felt i'm the suf-
ficiency of credit even at high rates. All
commercial interests suffer during each
crop period. Excessive rates for call
money in New York attract money from
the interior banks into the speculative
field. This depletes the fund that would
otherwise be available for commercial
uses. and commercial borrowers are
forced to pay abnormal rates, so that
interest charges, is placed on the whole
commerce OF the country.
Present System Defective.
THE mere statement of these facts
shows that our present system is seriously
defective. There is need of a change.
Unfortunately, however. many of the pro-
posed changes must be ruled from con-
sideration because they are complicated.
are not easy of comprehension. and tend
70 axiSffnu riUbfG md inf
We must also rule out any plan which
would materially impair the value of the
United States per cent bonds now
pledged to secure circulation, the issue
of which was made under conditions pc
culiariy creditable to the treasury. / do
not press any especial plan. Various plans
have recently been proposed by expert
committees of bankers Among the plans
which are possibly feasible and which
certainly should receive your considera-
ton is that repeatedly brought to your
attention by the present secretary of the
treasury. the essential features of which
have been approved by many prominent
bankers and business men. According to
this plan national banks should be per-
mitted to issue a specified proportion of
their per capita in notes of a given kind.
the issue to be taxed at so high rate
as to drive the notes back when not
wanted in legitimate trade. This plan
would not permit the issue of currency
to give banks additional profits. but TO
meet the emergency presented by tlmeS
of stringency.
Not Certain He Is Right.
II do not say that this is the right sys-
tenn ] only advance il to emphasize my
belief that there is need for the adoption
of some system which shall be automatic
and open to all sound banks, as TO
avoid all possibility of discrimination and
favoritism Such a plan would tend TO
prevent the spasms of high money and
speculation which now obtain in the New
York market; for at present there is too
much currency at certain seasons of the
year. and its accumulation at New York
tempts bankers to lend it at low rates for
speculative purposes; whereas at other
times when the crops are being moved
there is urgent need for large but tenn
porary Increase in the currency supply.
1t must never be forgotten that this ques-
ton concerns business men generally
quite as much as bankers; especially is
this true of stockmen. farmers and bust
ness men in the west; for at present at
certain seasons OF the year the difference