The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1908-02-07
REPORT RIPPED
INTO TATTERS
Senator CuIberSon of Texas
fShoWs FalSity of Statements
of Secretary CortelyOu.
FAvORS FOR WALL STREET
tLLEGALITY OF THE PER CENT
CERTIFICATES.

Washington, Feb. 6.-In a speech in
the senate today Senator Culberson de-
clared that the secretary Of the treas
raised an issue of fact as TO whether
national banks in New York used the
SIS. 600, 900 of public money deposited
with them for speculative purposes or
whether this money was used to meet
the demand of outside banks for re-
serve purposes.
Mr. CuIberson complained that the
committee on finance had failed TO
take any action on the resolution d.
recting that it inquire into the causes
of the present financial stringency.
Violated the Law.
He declared that the report of the
secretary of the treasury had shown
that that officer had violated the law
in issuing the Panama bonds, because
money for the canal was not needed;
and that he had violated the law in
awarding these bonds to national
banks, instead of individuals and IN
using the proceeds of the sales for the
purpose set forth in the report and not
for the construction of the canal.
In issuing the per cent certificates
the secretary also violated the law, Mr..
.CuIberson said, because they were not
used for the purpose provided Ry the
statutes, as there was ample FUNDS Tor
such purposes. Moreover, he said, the
secretary had violated the law in using
the per cents as the law limits the
basis of such notes TO registered bonds
of the United States and to Panama
bonds. He had also failed 10 distri-
butte this money as provided under the
%
was inequitable, said Mr.. Culberson, as
the money was used by the New York
banks for speculative purposes.
Deposits of Public Money.
The public money deposited in the
national banks of the United States,
said Mr.. Culberson, ION March Y, 1917,
was $14O, 900, 600. On Dec. the amount
reached the enormous sum of $223,0O0,-
600. In New York City alone on March
% the amount on deposit there was
sg OOO.O 600: on Aug. p, S2S.OOO,OOO. and
On Dec. 3, S75,O0o,0 600.
New York City, with about one
sixth Of the capital and surplus of all
the banks, secured one-third of all the
public money On deposit, the eastern
states. including New York, having
only about three times the capital and
surplus of the southern states, were
given lOuI tiiliSS AS hlUNh u tiAS pun
lie money. 4
THE state O. Texas, with 100000 q
people and a banking capital and sur
plus of s4OO00,O00. compared with
Washington, d. G, with a population
of 800 900 and 2 bank capital and sur
plus of IS, $50 600, got but Sl,SSO,O00 OF
the money distributed Dec. 3, while
Washington got $4,5s1,OOO."
Mr.. CuIbersOn charged that the re-
port of the secretary of the treasury
contained a denial of its own state
ment.
What the Figures Show
THE secretary of the treasury" said
the senator, says in effect that S25,-
600 900 of specie held by the New York
banks and $40, 000, 600 of reserve was
used TO meet the call of outside banks
whose reserve the banks of New York
hold, whereas, the report of the secre-
fary shows clearly that the amount
which the New York City banks owed
all other national banks decreased be-
tween Aug. % and Dec. only S1O,S2O,-
511, and it is significant that although
the New York City banks did not pay
10 the banks outside of that city more
than this s1O.S20.511, they increased
their loans and their discounts during
the same time So, 000,0 OO."
Mr.. Cblberson exclaimed: Il want
the figures to ring in the ears of the
American people.
Continuing, Mr.. CulbersOn said;
"These figures show that while this
manic Was on and while individual de-
tpositors wers clamOring for their money
while the New York banks were issu-
ing clearing house certificates, while
the outside banks were demanding
their reserve. the national banks OF
New York increased their loans ano
discounts by 500, 100000"