The diamond drill. (Crystal Falls, Iron County, Mich.) 1887-1996, 1908-07-18

permP nent confidence is due 70
meas res which wiz eliminate the in
cendiaries. So, in banking. everything
is secondary TO the cho'acter Of the
assets in the loan item.
IL cannot be insis "a pom too strong
~ that the effort 70 create co~edence
and prevent panics by insarrncs Of
deposits Is going to the wrong end Of
the problem. TIE deposits crn never
! 3 any safer than the as Is. There
fore, II we wish TO create con idencs
and prevent plnics, every effort should
be directed TO securing Only the safest
hind Of assets This is the crrx of the
whole matter. To talk orIy of insur-
ance and to minimize the Importance
Of the quality of the assets, is only to
act after the damage is done to close
the stable door otter the horse Is gone.
or course, the insurance advocate will
say that insurance will bring about
ssfer banking methods bat OF that
more later on.
The insurance theorists probably
mean that their scheme world 81 event
a panic because it would prevent run
ON any bank in the system. One would
be curious TO know upon what analysis
of credit operations crisis could be
regarded as due merely TO the state Of
mind which leads to run for cash.
In truth. run, lack of confidence,
is a consequence. not a cause, OF panic
conditions.
Sometimes our Legislation falls into
the hands Of those politicians who con
fessedly pay no attention TO the work
/, OF experts. The existence Of compli-
Gated monetary and banking problems,
understood by only few, furnishes
the opportunity for professional politi-
clans to bring forward measures which
may appeal TO the private interests OF
one class as against another. bat which
show utter want of analysis and an
ignorance of fundan ,ntel principles.
For this rsa on Legislation goes by
Jerks, now bad now good, according
rs supposed pubic opinion favors the
one or the other Although we have
many serious minded statesmen. still a
mep sure Is not irffequently iugded by
its power to gain votes for ne party
ia power in the next ele 'tion Conse-
quenly. the candidate for Office is
eagerly Learching the field for schemes
which eau be Isgarded az personal be-
longings. aud which will appeal to un-
informed masses quite independent OF
their true ethical or monetary quality.
or such character was the rag
baby" of greenback days, or the free
coinage of silver of more recent mem
DRY and the last member to be added
TO this motely collection is the guaran-
tee Of bank deposits Its appearance
at this moment, soon after financial
crisis follows the equal sequence OF
freax schemes In the wake Of business
disturbances II finds honest supporters
not only from those who were injured
by the inability 10 withdraw deposits
in the days OF the recent panic but.
also from those who believe they have
found In IL the means OF preventing
panics. Superficial thinking as to pan
ice. and little understanding OF the
actual operations OF banks have pro-
vided soil In which the proposal for q
guaranty of bank deposits may take
quick root. In the interests OF sound
basis for our monetary and banking
institutions II Is well worth the while
TO give searching examination to a
scheme which IL quite certain to be-
come an issue In the coming campaign.