The Birmingham age-herald., 1908-01-17
BANKING SYSTEM
 NEEDS REVISION
Charles N, Fowler Talks on
 Currency Problem
No UNIFORMITY IN SYSTEM
Congressman Fowler Declares That the Provisions of His Bill Will Exactly Meet the Require.
 ments of United States.

Boston, January 16.-"The Currency | Problem was tile subject of an address | delivered by Representative Charles N
 Fowler of New Jersey chairman of the committee on banking and currency before | the Commercial club of Boston at the New Algonquin club tonight. On January ! $, MT. Fowler introduced in Congress d 1 bill ito establish simple and scientific monetary system. founded upon gold. guaranteed bank notes and silver, with uniform banking and bank reserves in gold coin or it's equivalent; to guaran- tee all deposits and note issues and to fix certain. rules and regulations where by the financial operations of the gov ernment shall cease to be d disturbing factor in trade and commerce.
 In his address tonight Congressman Fowler said in parts
 There is no consistency or uniformity | in American banking as a whole. Too little is actually known about the condi- tion of our banking business. The situa- tion has already become appalling and demands a uniform banking system with uniform reserves in gold coin. This re- suit will be secured by the bill now under consideration by the committee on bank ing and currency.
 "ro economically and adequately pro- vide for the production and sale of such a vast amount of merchandise as we are producing annually, we should have q simple and scientific monetary system con- sisting of gold for our bank reserves having converted our United States notes into gold certificates bank credit cur rency, redeemed into gold for our larger bills, providing the true medium of cash exchanges and silver for our smaller bills and subsidiary coins. There is more than enough of both gold and silver in this country if placed where they properly belong to meet the requirements of each. This end will be accomplished by the measures now before the House, and we shall then be upon equal footing with the rest of the world in this respect.
 We should have a system of current bank credits that will always. with un- erring certainty, come into existence with business transactions precisely as checks and drafts do, and disappear when they are no longer needed. That this most de- sired end will be accomplished by the adoption of the measure now pending be. fore the House committee no one has yet undertaken to deny.
 .'The government should cease to be a disturbing factor in the trade and com merce of the United States, and should deposit it's receipts from all sources every day with the banks of the country pre- cisely as other governments do. The bill before our committee does just this thing.
 The national banks now own about all of the per cent bonds, including the Pan- amas, or about S700,0O0oO0. Suppose we should have great war, a war calling for an issue of bonds aggregating $2,000,- 100000 or 5000 000,000. the rate would pos sibly reach per cent. At such rate the 2's would sell for about 70 75 or pos sbly 60, resulting in loss to the banks ranging from $150, GOO GOO to $25O 600. How many banks could stand their share of loss without failure? The same might possibly occur on some other bonds.
 ''The measure we are now considering takes all these ? per cent bonds off the hands of the banks at the prices paid for them, and places them in the guarantee fund. All the capital now invested in these bonds, and all the capital now in- vested in bonds to secure government de- posits, is returned to the channels of com merce, where it legitimately belongs. and where the trade of the country can use it.
 "The structure of the bill now before us is based upon that of our general government. The autonomy of the in- dividual bank is preserved absolutely. and also the autonomy of the commercial zones of the United States: for in organ izing the system the country will be di- vided into note redemption districts and each bank will have a single vote in electing a board of managers and each board of managers will exercise govern mental control over its respective district.
 "The per cent guarantee fund es- tablished by the cooperation of the banks in placing an amount equal to per cent of their deposits and note is sues in the United States treasury may be regarded as part ofsthe required re- serves; and. therefore, there is no addi- tional burden thrown upon the banks.
 "All the annual income going into the guarantee fund except the 1a per cent tax upon the present note issue is new revenue, and. therefore, results in no burden to the government. The total in come fom the first year, beginning with January 1, 1909. ought to exceed s25OO0,oOO and the fixed charges ought not to be more than $10,O0o,0o0
 'Is it too much to say that if we, have a guarantee fund of approximately s5O0.- OO0000 in the treasury of the United States with all the individuality of American banking interests preserved and local self government secured to our commercial zones. with all our required reserves in gold coin or it's equivalent, a currency always responding to the varying de- mands of trade and the government ab- solutely divorced from our trade and commerce, that our banking system will like our commerce and prestige in all other respects lead all the world.
 Twill it be long in that event before