The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1908-01-28
Topeka, Kan. Jan. 2S.
- ~ T~,,--a1.


To the Editor of the State journal:
There are one or two points winch
have not been discussed in the guaran-
tee fund controversy that is just now IN
the limelight, and 1t might not De
amiss if you would take them up ed1-
torially We are very much interested
| in this question of safety for depos1tors
money. and any information and knowl-
| edge we may obtain will enable us to
| more easily arrive at correct solu-
| ton of the problem. The very fact that
| the question is before US is sad COM
| ment on the business methods or To-Day.
However. as it is with us, we must
| meet and provide a way to best serve
| the interests of those most interested
! the depositors.
The kansas Bankers CNationaD as
ISOLATION opposes the proposed law
| without rhyme or reason, and from
| purely selfish motives. as Will readily De
| seen from an analysis of the situation.
| Of the seven hundred state banks In
| Kansas fully three-fourths OF them are
| located in small cities and towns ana
| thriving farming communities, Where
! there are no national banks and never
| will be- A national bank is sort of
| an aristocrat among banks and looks
| with disfavor upon its neighbor the
| state bank, and does not flourish In the
| small business centers and among the
farmers. On the other hand the state
bank established as 1t is In the small
communities of the state, is in touch
with class of depositors which the ma
! tional bank does not get and never
! would get. 1t is these depositors that
the advocates of a guarantee law pro-
post to protect and 1t looks like dog
n-the-manger policy for the bankers
association to oppose the proposition. Ii
eighty per cent of the deposits in state
banks are in localities where there are
no national banks why sshould the
bankers association say the proposed
/ ic moi
interested. In the consideration and
discussion of this question the likes anC
dislikes Of the national banks should
not be given a hearing because they
will not be parties to the proposed leg
islation.
Mr.. Mulvane says: Every safe bank
will be responsible for every weak bank
in the state" Mr.. Mulvane is pessimis-
tic in his views. If every banker IL
the state was as careful. conservative
and conscientious as Mr.. Mulvane there
would be no call for a guarantee fund
law. In certain sense every safe bani
would be responsible or interested In
. every other state bank in the state. and
the result would be that the weak ani
wildcat banks would be weeded out
There would be no weak banks. The
| Spectator and the boodler would be
| eliminated from the business. The banl
examiner would make more frequent
| visits. OF course the wfsest and mos1
1
meets with misfortune. and for this
alone the proposed measure should
meet with hearty approval from ALL
There is one point more which should
be discussed and that is. the manner il
| which the fund of one million dollar,
or over should be handled. in event tn,
measure becomes a law. 1t seems tina
the committee guarantee bill provide,
that the fund shall be in charge of tn.
state bank examiner. and that he ma,
invest 1t as he sees fletcher in bond,
or state repositories. There should b,
no loop-hole of this Kind for specula
| ton or misuse of the fund. A law il
that shape might neutraliz itself /,
TINS way. Suppose that the commits
sioner. exercising his discretion. de
posted the fund in the state depositor-
(some bank in New York City, and tina
bank failed. The bank commissions
should not handle this fund It SHOULD
De invested in bonds and deposited witt
! the state treasurer. A. GAYLORr