New-York tribune., 1908-02-14
BILL DEBATE.
Varied Yiezcs Regarding Purpose OF
Bank Reserves.
rFronn TIE Tribune Purea1-I


Washington. Feb. 13--Debate on the AI4-f~b IN,
occupied only short period in to-days sessfo, -
the Senate, but curious opinions rers-sf--
the purpose OF requiring the hanks TO rnainfas, y.
reserve were expressed Senator TaIiaSerro q.
instance. maintained that under no circunsta1c..
could bank diminish its reserve even for the nu,-
pose Of paying the demands Of depositors seuatov
Clapp tried to occupy a middle ground betvAs,
Mr.. Taaferro and others who supported his vss,,
and Messrs Aldrich and Bailey. who conterdsa
that the reserve was maintained to protect ds.
posiors and could be used for that purpose in cass
of necessity Mr.. AIdrich explained with cousda-,
able care and patience the purpose Of the various
provisions of the national bank act. but did uoe
seem TO have very apt class in finance, especially
the minority side of the chamber.
The use of the word ''energency'' was the basf.
of long argument by Senator Bailey. No bank
he said. would suspend cash payments 50 long as n
had money in It's vaults. u would De the duty
OF the bank however. call in money to bring the
reserve up to the legal requirement within thirty
days or be subject TO being placed in the hands of
a receiver
Mr.. Rayrer declared that the banks Of New York
were below their reserve for two months last fail
according 10 newspaper report, to which staten1en,
Senator Hopkins deuurred. insisting that the rec
ords would NOT show that they were below their re-
serve a month.
The statement being made by Mr.. Bailey tha.
banks usually keep close 10 the legal reserve SEN
ator Flint California. said the practice Of banks
is to keep ordinarily at ledSl per cent o. their
deposits in reserve and such IS the rule OF clearing
houses.
Senator Rayner reverted TO a controversy yestsr-
day concerning conditions under which national
banks NAV allow their reserves fall below s
per cent Of their deposits Mr. Rayner said TINS
reserve could be used TO pay the obligations Of a
bank but could be used TO make loans 10
customers
Senator Clamp declared that tire OF the
serve for any purpose is in Violation Of the law
1.-The Controller OF the Currency ne added. may
at times be blind to such violations Of law. I
old fashioned enough to believe the law ought 10
be obeyed, and the government should not wink at
violation of it"
Senator Culberscn offered two amendments 70 tis
Aldrtch BILL one providing that banks retain
their entire reserves in cash in their vaults,
the other for the payment OF interest federal de-
nosirs in national banks az the rate OF per cent
In August September October and November, ss
4 per cent in December, January, February ard
March and at 8 per in April, May, June aud
July.
Senator Clay gave notice Of a formal speech on
the Aldrich bill. and then the penal code bill ones
more demonstrated it's usefulness stop gap tha
of the day being devoted TO its consid-
Grafton
Senator Tfllrnan presented petition from Alfred
Crozer OF Wilmington. Del, protesting against ths
massage of the Aldrich bill. II read. and will
be printed The petition strongly objects TO that
azure of the bill which the restriction OF
existing law against the retirement OF the present
bank note and the contemplated emergency cur
rency.