Omaha daily bee., 1908-10-29

bank paid in three months after It was
closed from its own assets all of its de-
p%ositors, including the guaranty fund and
seems to nave had its capital remaining.
The deposits Of the suspended banks in
1898 were 800, 00O, 1900, and even last fall the
aggregate deposits Of the suspended banks
were over 800, 100000. 1t is a mistake TO
suppose that bank runs cause a financial
crisis. The crisis is brought about by
financial conditions and the closing of
some bank, either of its own volition or
by the government. The bank runs result
from the uneasiness created by the situa-
tion-without such a condition they are
harmless.
The investigation now going on In New
York shows how serious the situation was
there last fall. 1t would have been an
outrage and an injustice as well, as a con-
fession OF weakness, If the legitimate banks
had been required to carry the load that
would have been imposed upon them. 1t
was their refusal to do this which brought
on the general suspension of currency pay
ments.
Under a guarantee law these disturbances
or the chance for them would be greatly
increased, because the security OF the guar
anty fund would be used to bolster up such
concerns as the Heintze's and Morse's.
Instead of lessening the chances of bank
runs, the guaranty fund would increase
them. The Knickerbocker Trust company
alone had deposits of over $50, The
failure OF a bank whose deposit liabilities
should exhaust or exceed the fund would
at once destroy the prop upon which con-
fidence in the fund rested. This would
cause greater anxiety and larger appre-
--WI1 -AaafIINv ~ fEA
case at present.
1t is a mistake to suppose that all de-
positors lose faith in their banks in times
OF panics. The contrary is the case-a
large majority Of depositors stand by their
b~anks-having implicit faith in their sol
vency and responsibility.
Many banks have no runs at all ard
some increase their deposits. But II this
trust in banks by reason of their character
and standing is replaced by trust in a
guaranty fund and this confidence is de-
stroyed and shown to have been misplaced,
the depositor, for his own peace of mind.
has nothing else to do than 20 make demand
for his money upon the banks in which he
has deposited it. The result can easily be
foreseen.
There are some who, while not prepared
to support the plan as presented by Mr.,
Bryan. still believe sincerely that there
is some phase of the question which is
worthy of support.
But these. as we'll as others, who may
even go further and believe the plan is
commendibIe and practicable, must concede
that the question is open to consideration;
that II is too new to be hastily decided or
used to influence votes.
Mr.. Bryan ard those who follow him
when he calls do not hesitate to press any
thing which carries the possibility of in
fluencing votes. We know what Mr.. Bryan
has advocated in the past upon financial
md barking questions and what disasters
his views would have provoked II put into
practical operation. There has not been
a single thought or act in his life which
should inspire confidence in either his
Judgment or knowledge upon these sub
Jects. Therefore, even those who may.
upoD this question, have a leaning towards
his views, should hesitate to accept them
as a finality or allow them to influence
their votes.
II is much easier TO pull down than 10
build up, and politicians like Mr.. Bryan
always follow the line OF least resistance.
This great country OF ours needs rest
from such destructive agitation. The flu
ture is ours II we only know II ard can
take advantage OF the opportunities con-
stantly presented for our acceptance.
HENRY W. YATES.
Dunaha nrfahar oE TOol