Tonopah bonanza. [volume] (Butler City [i.e. Butler], Nev.) 1901-1909, 1908-10-10
THE PARTY
RELATING TO BANKING

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esource to safeguard depositors
from loss and making the private
fortunes of bank stockholders to an
amount equal to the par value OF
their stock subject to execution on
the banks defaulting its obliga-
lions. Republican State Platform.
I'VE are in favor of sound bank
ing laws and we hereby pledge our
representatives in the next legisla-
lure to the passage of a law provid-
ing for a guarantee fund for deposit
tors and containing the salient fea-
lures of the Oklahoma banking act. /"
Democratic State Platform.
The above two planks specifically
define the attitude of the Republican
and Democratic parties in Nevada on
the question of a banking law to be
enacted at the next legislature.
The Republican plank would pre-
vent the organization of new banks
hereafter in the state without the APP
pIicants for a charter were able to
show to the satisfaction of the
proper state officials that the re-
sources back of the proposed bank,
represented by the amount of capt.
tai actually subscribed and paid up
and the private resources of the
shareholders in addition thereto,
which would be subject to execution
in the event of the banks defaulting
its liabilities, are reasonably ade-
quate to guarantee depositors from
loss. With such a law in force no
new bank could be started without
there were substantial resources
back of it.
The law, also, would make every
shareholder in any existing state
bank personally liable, in the event
of the banks not being able to meet
its obligations to it's depositors, for
a sum equal to the par value of his
stock. This is in line with the ma
tional banking act except that under
the national banking act a stock
holder is personally liable for twice
the par value of his stock. 1t is
worthy of note in this respect that in
the thirty years operation of the ma
tional banking law the loss to de-
positors through the failure of na-
tional banks has been less than one
twentieth of l per cent, or a practi-
cally negligible fraction taken as a
whole.
The Democratic state platform pre-
sents the Oklahoma bank law as a
model for this state and pledges the
legislative nominees of that party to
the passage of a law in Nevada con-
tanning the salient features of that
act.
This is a very important subject
and the people of the state should be
advised with regard not only to the
merits and demerits of the Oklahoma
banking law but with respect to it's
probable effect If enacted upon bank
ing conditions in this state.
The Oklahoma act provides that
every bank in the state Is liable to
make good Immediately in cash the
demands of depositors upon any de-
faulting bank in the state; after
which the banks must take their
chances of reimbursement from what
available assets the defaulting bank
may have. Theoretically the propo-
sition looks very good from the de-
positors' standpoint. In Oklahoma
only n bank has failed since the
enactment of the law and depositors
received their money within ten days
after the bank closed its doors. The
defaulting bank. however, had only
$4,000 of deposits originally and
after eXhausting its available cash
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$4,000. This very small failure
can not be considered as any test
whatever of the merits or dement's of
the act.
Mr.. Bryan, in his campaign, has
advanced the Oklahoma act as one
that should generally be enacted by
both the government, in respect to
national banks, and by states with
respect to state banks. His advocacy
of the measure has focused atten.
ton upon it to such an extent that
1t has been subjected to a very
searching analysis. The best ant
most experienced minds of the coun
try have taken issue with him on tn,
act and pointed out very clearly tn,
positive dangers that lie back of 1t
1t has been shown that:
Such a law makes sound, conserv
alive, we'll conducted banks re
sponsible for the losses Of mis-