The Cairo bulletin. (Cairo, Ill.) 1???-1928, 1907-12-03
CENTRAL BANK

Advocated by Banker seliaman q
New York--cenounce Ger
tificates.
u Tho establishment Of centra
bank, jointly owned by. the govern
, inent and the national banks, was al
y vocated as means OF preventing
financiaf crisis in the future by Isaa,
N. Seligman, the New York banker
4 Mr.. SeIigmah referred to similar
systems in use III France. England
Germany and other European couh
tries and said that In finacial matters
America can proftably be guarded b,
the counsel of eminent French fnan
ciers and bankers.
| Mr.. Seigman spoke on the topic
Lessons of the Financial Crisis" He
said that the spectacle presented to
day by our currency to the civilized
banking community of the world is
simply shameful, and declared that
none Of the currency reform plans
which have been suggested up to
this time would adequately meet the
situation. Some measure of relief
might have been afforded the coun
TRY had any of these plans been In
operation during the present crisis,
he said, but at the same time it would
serve only as palliative and not as
a cure.
Advocates Central Bank.
The proposed central bank. he be
lieved, would result in certain ana
permanent relief. The plan provides
for bank limited chiefly to transac.
.tions with the clearing houses OF thsi
various cities. II would deposit. funds
with clearing houses and national
banks against United States bonds
and other approved security as well
as commercial paper and bankers
bills with proper margins. There is
no doubt in my mind" said MIR. Selig.
man, that II We had modified CEN
tral banking system the forced clos.
ing of the knickerbocker Trust Com
pany of New York could have been
avoided, as it would readily have |
on the first day of it's |
run $25,000,000 or more of Its good |
securities with the central bank, and |
the Needless run on other trust com.
panies would have been prevented"
Emergency Currency inadequate.
OF the emergency currency plans
which Mr.. Seligman criticised as in.
adequate. he spoke particularly of
the various suggestions for plan of
asset currency. This plan has been
Under discussion for a year. Such a
plan, advocated by many students and /
business men, said Mr.. Seligman,
has been strongly opposed by many
thoughtful, practical financiers. Has
he thought ever occurred to you, gen
lemen. what would have been our
present situation II this plan had gone
nto effect, and il all of the additional
circulation provided for
~ such plan had been issued during
he summer months when money was
stringent? Would We have been much
,etter off now. and would we not
gain be appealing to Secretary Cor.
elyou for help?"
Numerous Schemes.
We have had numerous tentative
chemes offered; tho Baltimore plan.
Ss7, the Carlisle and Fowler bills. the
fcCleary and Gage bills, the None
airy Commission indianapolis Con
ention, 1898 plan. and later the New
'ork Chamber OF Commerce and Am.
rIcan Banking Association plan.
sO6. All these plans practically pro
ide for asset currency. /. e., the
ght TO issue emergency currency i.
ased on a certain proportion of their
ond secured circulation. having FIRST /,
en- on the assets OF the bank. sub. :
ct to a tax to provide for any pos. 4
BILE losses. The weakness OF these y
st two plans has always appeared 70 =
Q In The fact that the graduated r
tie OF Interest is not sufficiently high a
insure the rapid redemption in nor. n
al times and also not sufficiently q
gh to insure the rapid redemption in 81
primal times and also not sufficiently b
gh tax rate to prevent the issue OF v
'tes In advance OF irregular requir.s- b
cnts. II Is likely that some measure e
relief would have been afforded 10
&C country " any one of these plans n
I'd been IN operation during onr Y
'esent crisis: at the same time it
ould serve only. as a palliative and
4 as q cure.
Financially UneiviIixed.
There Is truth in the statement OF
'rd Rothschiid when he character A
I'd this country as financially M d
Vilized In its bank methods n
The spectacle presented today by y
Ir currency 20 the civilized banking n