Waterbury evening Democrat., 1907-11-21
CORTELYOU IS ANGRY
Hears Banks Are Tying Up Gov-
 ernment Relief Funds.
SUSTAINED BY THE PRESIDENT

Believes That Certain Bankers lnstead
 of Utilizing Money. Released to Re-
 lieve Business Stress Have Diverted
 It to Build Up Cash Reserves.
 New York, Nov. 21.-The Amer1can published story to the effect that an acute difference has developed oetween Secretary Cortelyou and the DanKlng interests of the country. MT. Cortelyou feels that certain banking institutions have not treated him fairly. In this feeliug he is sustained by the presi- dent.
 The administration has stepped to the front to save the financial situa- tion. Instead of the men whose inter ests have been jeopardized co-operat- ing fully with the government they have met the governments liberality, it is charged, with selfish aggrandize- ment.
 To Build Cash Reserves.
 It is extremely probable that within the next few days several of the men who two weeks ago were fguratively on their knees to the secretary Of the treasury will hear from him in no un- certain terms.
 Briefly the secretary believes, and this belief is shared by the president, that certain bankers instead of utiliz- ing the funds released by the govern ment to relieve business stress have diverted the money to build up cash reserves. Others, it is said, have gone into the market to buy securities at panic prices rather than apportion the money. among the business interests that need it. More than S2OO, 100000 has been re- leased and placed in the banks. So law ish has the government been that the working capital of the treasury is close to a point of impairment. In addition I there is the decision to sell $50,000,OO0 | of Panama bonds and also to issue $1OO,OOOOOO in certificates of indebted ness.
 Bankers Are Hoarding.
 When the bankers and the Wall street fnanciers came to Secretary Cortelyou begging for this money, they declared that the legitimate business interests of the. country demanded it., that crops must be moved, cotton ex- changes arranged, and so on. It was with the idea that legitimate business interests were to be succored that the money was released.
 A totally different situation has de- velopedl The secretary has discovered that the banking interests of the coun- try instead of releasing the money for the need of actual business are utiliz- ing it in two ways:
 First-Where heretofore bankers had rency reserve of approximately 20 per cent they now, in many instances, have increased their reserves to 8 and even 30 per cent. As fast as money has been loosened by the government it has been locked up by bankers.
 Treated Unfairly. Second.-In many cases the banks have utilized the funds so provided to buy securities at panic prices against loans on them as collateral.
 As $ result of these operations there is no more money loose today for the business interests of the country than there was before the government start ed to render assistance to the crippled banking interests.
 This fact Is now realized by the sec retary of the treasury, and he feels that he has been treated unfairly. What step he will take to remedy the situation can be only surmised. One method Of retaliation is at hand.
 The secretary can withdraw the de- posits from the banks and the bank CTS who he thinks have acted unfair ly. After he has stated his views to the bankers, if he finds them still recalcitrant. he may take some such. step. Secretary Cortelyou has been told by men of affairs from all parts of the country that the very banks with whom he has been most liberal have proved the most niggardly in meeting the demands of the legitimate business interests.
 Has Evidence Against One Bank.
 One bank which holds more than a million dollars of the governments money has denied currency to one of its biggest depositors without a pre- mium for the transaction. At the same time there is evidence in the hands of the secretary that this bank is hOarding money to build up a cash reserve and is aiding favored interests. The same tale comes from all parts of the country.
 In fact, the belief now exists in the mind of the secretary that certain peo- pie who have benefited by the govern ment's liberality are utilizing these fa- vors and panic times to carry on shy lock operations.
 The Panama bonds. bids for which will be opened on Nov. 90. have been engraved and are ready for delivery. The s1O0.OOO.OO0 worth of certificates of indebtedness are well under way, so far as the printing is concerned, over S30OOO.O00 of the notes being fn- ished. The rest will he ready for de- livery by Dec. 1.
 Apop,sxy Takes General Pond.
 Winston Salem \. C, Nov. 21.-