The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1908-01-09
This the Principle Of the
Fowler Bill, Reported as
Basis orLegislation.
BANKS CHOOSE MAN
FOR EACH DISTRICT
Bank Notes and Lawful
Moneys to Be Presented in Lieu
Of Outstanding Notes Sc
cured by Bonds-Aims
Set Forth by Author
Of the Measure.

WASHINGTON, January s.--The SUBJ
committee Of the House Committee on
Banking and Currency, to which was
lntrusted the framing OF bill to In
crease the elasticity of the currency,
reucted a. conclusion to-day, and will
report favorable to the full committee
a bill drawn by Chairman Fowler. The
till will be introduced by Mr.. Foster
and referred to his committee, where It
will form the working basis for the
framing Of bill.
The bill provides for the complete
retirement OF all present outstanding
national bank bond-secured currency,
and authorizes In lieu thereof a cur.
rcncysbased upon general assets OF the
banks In this way: The Comptroller Of
the Currency will designate throughout
the country certain redemption cities.
SO that there ehall be a redemption city
within at least twenty-four hours
reach OF every national bank. The
rational banks will Indicate to the
Comptroller Of the Currency to what
redemption city they wish to be Joined.
The comptroller will then select
time and place within each redemption
district for the organizing Of that
district IN the following manner. Each
national bank In that district
regardless OF its capital stock,
VIII be entitled to one vote. Reprel
sentatives of the banks will meet at a
time and place designated and elect
board OF managers. to consist OF
seven members. These seven will elect
chairman, who will become a Deputy
Comptroller OF the Currency and as.
sumo control OF his redemption dis
trict. except that he shall not have
charge of the enforcement cf the
criminal statutes.
Guaranteed Credit Notes.
Each national bank is authorized to
present to the Secretary of the Treas
.ury national bank notes and lawful
moneys In lieu OF other national bank
bond-secured outstanding notes. Then
II the banks application therefor Is
indorsed by the board of manag gers OF
the redemption district to which it
belongs. the bank will receive Guaran-
teed credit notes to the amount OF its
capital stock.
These notes will be subject to a tax
of 2 per cent. per annum. Each bank
will be required to deposit as a guar
anty fund with the Treasurer OF the
United States 5 per cent. of its aver.
age deposits for the preceding twelve
months. and s per cent. of the credit
notes which 1t takes out. The rev.
enue thus obtained Is to create and
support a. national guaranty fund OF
s500.o00,000 for the guaranty OF both
the deposits and the outstanding bank
notes Of every national bank. Eighty
per cent of this fund is to be invested
In United States bonds. drawing Q per
cent. interest, while the remaining 20
per cent is to he deposited In banks
of the, various redemption cities for
the purpose OF redeemng the guaran-
teed credit notes of the banks In the
various redemption districts. When the
national guaranty fund reaches s25.-
100000. which would be almost stimuli
taneous with the birth OF the new
law, the government is required to re-
turn to the banks the United States
bonds which the government now
holds as security for Federal depos-
Its; the object being to enable the
banks to get control OF the bonds. so
that. the government can invest the
80 per cent OF the guaranty fund in 9
per cent bonds and regain control
In buying these bonds the banks
holding them shall be paid their orig
inal purchase price. provided the bonds /
were bought before January L. 1908,