New-York tribune., 1908-02-17
CrRPENCY N An EMERGENCY.

The chief reason now being given for support
of the Aldrich currency bill is that some egisla-
ton is necessary at this session to safeguard the
nation against possible recurrence before Con-
gress meets again Of such a banking panic as
took place recently, and that the Aldrich bill,
while a makeshift, is the utmost that can pc
expected from Congress now. 1t is the Aidrlch
bill or nothing with dark forebodiDgs OF grave
peril il the measure is rejected The govern
ment surplus it is said, may be SO reduced in
1.-The next few months that the Secretary of the
Treasury may not be able to come TO the banks
relief with government deposits 1t may not
be possible TO issue government bonds TO swe!
the bank circulation. And the country may NOT
be in the position TO command gold from abroad.
On the other hand. there is suggestion that
if believers in true currency reform VIII waive
their objections the Aldrich makeshift will be
merely temporary and Congress will ''in the
immediate future take up the whole subject,
including the formation of a central bank. The
supporters of the Aldrich bill intimate their
readiness 10 have a currency commission ap-
pointed to investigate and report II their bill
becomes a law.
Now Of course ii is extremely unlikely that
an acute financial disturbance will break
out again in the future. The history OF
panics shows that they take place only at long
intervals ana after Tlrn fat1cl IFPllUnS on over
strained credit But assuming that the dan
ger of u recurrence is sufficiently great To be
guarded against by legislation while thorough
going reform is receiving adequate considPra-
ton how does that render the Aldrich nuke
shift any more desirable: If it is understood
that the new currency law is to be only of a
temporary character will banks buy bonds SO
as to be prepared for an emergency: They do
not carry any considerable supply Of these Sc
c4lrities in their vaults. and something more
than the remote possibility of chance of using
them within the next few months would he
necessary 10 induce them TO modify their invest
ment policy. If the crisis came on the banks
without the required bonds on hand only those
of the great cities, particularly those of New
York would he able to purchase 10 borrow
the securities needed TO relieve the country.
This argument that an emergency may come
on lis when we least expect it, and that Con
cress which has neglected for years TO pro
vide for it, cannot now safely adjourn till next
winter without passing some legislation. is
really one for making such assets rs the banks
always carry instantly available as the basis
Of circulation in 4 crisis. IF good mercantile
paper could 10 used 10 support note issues no
emergency could ever arise when the banks all
over the country. those in th" villages equally
with those in the great cities would not have
at nand q OASIS Tor emergency ISSUES. Is II
protecting business against periIs TO grant banks
the right 10 issue notes, providing they possess
certain securities which they have not and are
not likely TO have: There is large measure
of pretence in that sort of protection. especially
when il is possible TO give banks the right TO
take olIt circulation on assets which all possess.
( With one provision the banks would be ready
in an emergency and with the other they would
not. The ono is felt TO discriminate against
certain sections of the country; the other would
be equally fair to all.