New-York tribune., 1908-02-11
DEPEW PRAISES MORGAN.
Defends Cortelyou's Course an Re
cent Panic.

Washington. Feb. 1o.-Senator DepeW to-day re-
piled TO a recent charge made IN the Senate oy
Senator Culberson. of Texas. that In the recent
panic the Secretary of the Treasury favored New
York City In depositing public money In national
banks. The danger that was SO great he said.
was avoided by wise action of the Secretary or
the Treasury, assisted by that phenomenal genius,
Pierpont Morgan, who associating with himself
the bankers of New York. provided the means ny
which the assailed banks could be saved"
At the time this utterance was made MI Morgan
occupied seat In the private gallery and was a
careful listener to all that was said
Mr. Depew said that the New York banks are re-
quired to keep reserve OF 25 per cent while some
institutions in other parts of the country keep a
much smaller amount. The danger IN New York.
he said realized.
eff there should be a there" he said. there
would be one billion to pay thirteen billions OF dc
posits and they all entitled to cash. Under
such conditions commerce stops and the whole
trade of the country is subject to paralysis. No
chain is stronger than its weakest link and the
weakest link is the trust company with 8 per cent
or less doing a banking business without
banking conditions. These institutions are strong
In their surplus and rich In their conditions
theless they hopeiessy unable to meet sud-
den demand which may be made upon them
Texas he said would have been affected by a
calamity in New York and prices would have
fallen there
at was at that critical moment" MI. Depew de-
clared, that the Secretary OF the Treasury came
to the rescue of the situation and made these de-
posits for which he has been criticised"
''The letter OF the Secretary Of the Treasury, he
said, rings with clarion notes" His wise and
prompt action had stopped the panic and saved the
country" The issue OF securities was lawful and
within a fair Interpretation of the statute. The
Panama bonds to be sold from time time to
meet the needs OF the canal. Money had been
spent and it had to be replaced in the Treasury
This he declared. "dsposes of the charge that
the money not needed
He declared that New York City banks had gone
relief of other banks by providing money for
the sale Of cotton and wheat shipped to Europe
THAT money" he said was furnished the people
the country at the most critical part of the
panic" The deposit of money in the New York
banks placed it in the proper place for its dstrbu-
ton the country.
In a crisis like that through which we have
just passed" he said, the country banks get IN
their demands for currency after the people he
spot have got In theirs" No bank could transact
business and Hquidae at the time. The
of from 31a to ; per had come from
banks hut was drawn of safe deposit vaults
by the offer of that premium.
There was S100 0O0. 900 less loaned on collateral
I'm the Stock Exchange in 1907 than in the rreced-
ing year. The banks had stood by their patrons
and had lent money for commercial PURPOSES at
regular rates CT interest rather than secure from
100 25 per cent by lending in the stock market,
and that reason there had been SO few CONNER
cial failures.