The Rich Hill tribune., 1908-10-08


ia entrast money 90 Their care
ceresui nanisinE nest.
Under present conditions there ere
tlmnonsations in favor of careful and
conservative banklng There are peo
fl8 who are not innuenced IN thelr 90
lection of q hank by the highest rate Of
Interest offered ON deposits and who
have their suspicious aroused by the
tender of exceptional Inducements
They know ihat such offers put a
slfalu upon The business, and they Dc
fiberately prefer 10 place their money
with banker who VIII not subject
himself TO such elrgin. These deposit
ors esteem safety above all other con
siderailons, and they are numerous
enough TO exercise n very wholesome
restraint upon reckless tendencies inI
The business. A banker now prizes the
reputation Of doing safe business
and cannot afford 10 have a reputation
for imprudence and speculative in
elinatious And yet although held IN
check by these powerful considerations
the pressure Of competition carries the
business near the danger line even
now. There is too much competition
for deposits. aud the ambitions Of the
more veuturesome members Of the fra
ternlty, and the pace they set, puts the
whole system under strain
But what are likely to be the con-
ditions IN the business when the public
Is no longer concerned about the man
agement Of a bank, and all the re-
wards for conservatism and RESTRAINTS
upon recblessness are removed7 The
considerations which In the past have
tended to safeguard the business and
advance It's standards would be gone,
The public would care nothing FOR the
personality OF the banker. Instead Of
looking 60 the institution which recelg- /
cd the deposits. the depositor would re-
" on an outside fund A banker
might bet all the deposits on hoSse
races without the fact becoming
matter Of any concern to his custom
ers
And how would the conservative,
prudent banker fare under these con-
ditl0ns9 The legitimate reward for
maintaining that character would be I
lost 10 him He would get no deposits I
unless be bid as high for them as his I
rivals. for the government would stand
behind the latter. and assure the pub (
lie that they were just as safe as he,
and tax him to make them so. In
short the reckless aud incompetent peo
pie, who are new either excluded from
the banking business, or held in check
BY the 6tstrust which a discriminating
public feels towards them, would make
the pace to which everybody else In
the banking business would be obliged
to conform or get out Of the business, !
wouId DeHnornIizs Business.
The hardest competitor In any line
Of business is the Incompetent or dis
honest man who does anything TO get
business Such people get into the
banking business even now. but their
number and influence for mischief
would be greatly increased II they
were backed mp by unlimited credit. IN
other lines there may be some question
as to the quality or service offered by
rivals but all bankers deal IN the same
kind Of money. aud n deposits were
made a joint liability, there Is no rea-
SON why they should not go to the
bankers who of'er the greatest Induce
ments 90 attrnct them The careful
banker would have no OFFSET Oh protec-
tion against demoralizlng competition.
aud be would be placed IN the strange
position Of being liable FOR his com
petltor's obligations.
All efforts 70 make Il appear thar the
interests of bankers are on one Side of
this question and the interests Of de
posltors on the other are untrue to tho
facts Nothing thar IN the long run is
harmful 10 the banking business. that
puts Il under strain and tends 20 low
er lbs standards. can be beneficial 70
dcpasit0rs or the public IL caunot be
advantageous % the community 10 have
its savings and working capital pass
into the hands ~ the ventureome
class of bankers who win bid most for
them The actual waste and loss
throueh unnise Investments would in.
eYiiably Increase II would fan at first
op fhf conservative bankers and penal.
lze lh1a instead OF au elimination q
the unit which Is the true process of
evolution. the tendency would be- 10 an
elimination " the best Eventually ;he
burden Of increasing waste would have
10 be borne by all deposltors and the
whole community
0kinhpmA Trial IncancIustvs.
The faet that the first bank failure
in Oklahoma after the law went int,
eject was followed by Immediate re-
endorsement of the depoaitors. proves
nothing as 10 the praeticabillty Of the
system in the long run The fact that
the State banks OF Oklahoma have
gained deposits since the system went