Milford chronicle. [volume] (Milford, Del.) 1878-1974, 1908-03-06
The ALDRICH
CURRENCY BILL
Senators McCumber and Newlands
Speak On the Measure
OPPOSED TO EMERGENCY MONEY

Washington, March 4.-senator.
McCumber. of North Dakota. ant
Newlands of Nevada, spoke at length
upon the Aldrich currency bill
Mr.. McCumber was opposed to any
expansion of the currency. except to
rave the country from a catastrophe
he said. He referred to the impor.
tation of $1OO,OOO,OOO gold during the
panic, and declared that it had not re-
established the old conditions. If that
amount of gold had not met the con-
dition, he had no confidence that the
pro- sed issue of $500. 900 900 of en-
Urgency currency could do it.
"The expansion of the currency" he
said. docs not expand the confidence
Of the public in American securities. .
The pending bill, he added, was not
put forth with the claim that it would
be a tonic for industrial conditions.
but merely as a means of relief in
case of runs on banks. That" he
insisted, 'is the only purpose in the
world that could be assigned as
reason for giving support to it."
Previous panics had been brought on
by the people, but in the case of the
recent panic it had been brought on
by the banks, he declared. 1T is the
activity and not the bulk of money
that pays debts" declared Mr.. Nc
Cumber. II am not generally in favor
Of any elasticity in our currency, as
] believe such elasticity is as pernic-
ious and almost as bad as an elastic
conscience. But I can see that if our
industrial conditions are not changed
there will arise in the future a condi-
ton again. that will demand elasticity
to prevent a great catastrophe. For
that reason and because of the uni
Tersal demand for an elastic currency
am willing to vote for this bill"
He favored a government guaran. |
tee of deposits in national banks.
A colloquy with Senator Carter fol |
lowed in the course of which Mr.. Car |
ter, commenting on failing banks, !
said:
There ought to be clear way open
from the back door of the failed bank
to the penitentiary"
Declaring that currency legislation
should be directed more to the Sc
curity of deposltors than to the ere
alton of an emergency currency. Sena-
tor Newlands gave a careful analysis
Of certain features of the pending bill.
''The only way to ecure deposit
tors" he said, els by ample capital
and sufficient reserves. The capital
and the reserve together constitute
the security of the depositors, and
should in all cases amount to between
30 and 40 per cent of the deposits.
The capital which should amount to
at least Is per cent of the deposits.
should be invested in the interest !
bearing securities. and the reserve,
which should amount to at least 20 :
II rs per cent. should be kept in cash !
n the vaults of each bank and not {
entrusted to other banks {
Viewing the state and the national
,anks as one system. Mr. Newlands
it was obvious that the l
mount of reserves kept in the banks a
vas insufficient and would have to be
increased. He urged that T
he nation should gradually retire the @
arious forms of United States notes, C
UGH as silver certificates. gold GER
and greenbacks. and substi- .
lte one form of United States notes, O
nd that the coin now backing the c
liver certificates and the gold certif-
ates should be gradually placed in F
le redemption fund Of the treasury as a
scurity for this general form of "
nited States notes. The United
tates treasury. under existing condi- c
ons, was practically engaged in c
mixing. Fifty per cent gCld reserve
as considered sufficient for the note c
sue of bank of issue There should
no reason, he confined why the
nited States should not be able in
.riods Of emergency to increase the
sue Of notes upon this gold and sill
r coin in its vaults to meet any II
lergency.