The Rice belt journal. (Welsh, Calcasieu Parish, La.) 1900-19??, 1908-09-04
BRYAN SPEAKS On
BANK GUARANTEES
in SPEECH AT TOPEKA HE DE
FINES PLATFORM PLANK.
TO BENEFIT COMMON PEOPLE
Points Out Many Advantages of the
Proposed System and Meets the
Various Criticisms of the
Republicans.

'SF~S''~'S'
Topeka, kan.-Mr. Bryan spoke be-
fore an enormous audience at this
place. His subject was Guaranteed
Banks" and he said in part:
Why not make the depositor secure?
The United States government requires |
the deposit of specific security when II
lntruStS money to Il national bank, al |
though it can examine the bank at any |
time; the state requires security when 1t
deposits money in a bank; the county re- |
quires security and the city requires Sc !
curity; even the banks require security |
from the officials who handle money
Why should the depostor be left to take
his chances?
Not only is the depositor without pro-
lection, but the security given to ma
ton. state, county and city lessons ms
security. They are preferred creators;
they have a mortgage on the gilt edged
assets and the depOSitor must get along
as best he can with what remains. why
are the interests of the depositors thus
neglected?
A bank asks deposits on the theory
that the depOsitor is sure of the return
Of his money. and the laws ought to
make the facts conform to the theory.
The depositor, the community and the
banker himself will be benefited by legls-
latiOn which will give to every deposltof
the assurance that that which is com
mitted to the keeping of the bank will be
available to meet his needs at any tlme
Such is not the case to-day, for Whlle All
banks are reasonably secure, they are
not absolutely so. This statement can be
verified in several ways.
First: The president has advocated
postal savings bank, and his postmaster
general, in presenting an argument IN It's
favor, pointed out that many millions
are sent to European savings banks
every year by Americans or Foreign blFth
| who prefer to trust the state institutions
| of the nations beyond the sea, rather
| than the private banking institutions
here
Second It IS known that a consider
able amount of money is in hldlnS. the
amount increasing with the approach Of
| a panic or business depression. This mon
ey is not only withdrawn from active
use. but is likely to be withdrawn just
| at the time when money Is most need
| ed and when the withdrawal will increase
| the financial disturbance. 1t is fmpos-
| sible to reason with fear; 1t is futile TO
! tell men that they will probably get their
money. The moment the depositors sus-
| pect bank they hasten to destroy It's
| solyency. Distrust. and distrust alone,
can explain the hiding of money.
Third: The increase in the issue OF
money orders. payable to the order, of
the purchaser, Is another evidence that
people are seeking greater security for
| their money. The banks will pay an In
terest upon deposits, and yet those VINO
buy money orders prefer to lose the In
terest and, in addition to, that, pay the
| price Of the money order in order TO Sc
cure the governments guaranty.
Fourth: National banks confess that their
banks are not secure when they oppose
the guaranty Of state banks on the
ground that it would lessen the depos-
hp,,l md TO n q
confess that their banks are not secure
when they oppose a national guaranty
system on the ground that 1t will draw
deposits away from state banks. III you
want to find whether banks are absolute
ly secure, ask the directors to give you
their personal note to secure your de.
post and you will learn that they vii
not bear the risk which they ask you tt
bear.
Fifth: The experience Of Oklahoma
furnishes conclusive proof that deposit
ors do not feel that their money is safe
ccmber. 1907 the Oklahoma Legislature
which became operative February 4, 1908
By the provisions of this law, all STATE
banks, and as many national banks a!
desire to avail themselves of the law
are taxed ! per cent on their deposits
and the money thus collected is put int
a guaranty fund The banking board il
authorized to make additional assess
ments from time to time to keep tn
fund up to this amount, and Is directed t
take possession of any insolvent bank
pay the depositors in full, and reimburs
the fund by collecting the assets of tn
failed bank. Five hundred and fifty-fiv
banks including 81 national banks, hal
come under the provisions of this lay
on the 14th Of last May, leaving but Is
unsecured banks (alf nationaD in tn
Cfof made nv the bank
, In December and May. Between thes
periods the secured banks gained in de
posits 1927, 1922, while the insecure
banks, all national. showed a decreas
in deposits. of sl,lolSO1S6. A large par
i brought from hiding or from without tn
state, but the decrease in the insecure
banks can only be explained tn one way
A large number Of depostors Withdrew
, their money from the unsecured banks
and deposited 1t in the secured 6anks
! and this. too, in spite of the fact that 1
order to prevent Withdrawals, the unse
cured banks. in some instances. offere
t a higher rate of interest than the secure
a banks were permitted to pay; and
must be remembered also that the bank
r national banks. And to make it .certai
that the difference was caused by tn
8 guaranty law, the secured national bank
n gained, while the unsecured banks los
| While the deposits were increasing IN III
. guaranteed banks of Oklahoma, the
, were failing in the state banks and trus
= companies of Kansas-the decrease bein
:. 81. 153, 026.27 between March 81 and Jun
49, -,
No amount of criticism of the tint
| depostor can change the facts; the pee
]. ple who deposit money want more sc
4 curity than the laws at present Civ
them They will change banks to ,ge
n more security. and, If necessary. the
4 will send their money to another state
For many years efforts have been mad
j. in congress and in the various states
9 secure @ law guaranteeing deposits, bl
the influence of the great banking inst
q tutjons has been sufficient to prevent az
d ton. Last fall, however when the bank
by concerted action suspended pay
ments on checks. the depositors WEI
). everywhere brought to realization {
:. the fact that their deposits are In fax
u loans, payable on demand under ordinarr
r circumstances, but payable at the wi
of the bank In emergencies. The depo!
itors suffered considerable loss durin
q the suspension of payments, and the
4 have not forgotten the lesson which the
then learned The Democratic party, b.
II ing more free than the Republican part
a to respond to the needs of the masst
of the people, inserted the following plan
q In its national platform:
n I'VE pledge ourselves to legislation
which the national banks shall be r
uuired to establish guaranty fund =