The Holly chieftain., 1908-10-02

acter cea sed to be = factor in the b,;si
meas. and all deposits were given blind
Iy to whoever would bid highest 10,
them. To the objection that this elm
ination of character Ms factor in tn,
acquisition OF deposits must tend tr
promote reckless banking. reply II
made th... bankers will be deferred
from reckseSsness by fear Of losius
their ovn money. The reply misses thu
point. All n,en are not deferred from
recklessness by fear Of losing their
own money. b.. reckless men are now
as rule. kept out Of the banking hus'
ness by the unwillingness Of the public
to entr;ist money to their care.
ca<ef.l Dsski.x Be~t.
Under present conditions there are
compensation In favor of careful and
conservative banking. There are it.o-
pie who are not Influenced in their Sc
lection OF bank by the highest rate o1
interest offered on deposits aud wlin
have their suspicions aroused by the
tender of exceptional Inducements.
4
r;r.lin upon the business. and they de-
libcrateiy prefer 10 place their money
with Il banker who will not subject
himself to such strain. These Deposit
Grs esteem safety above all other con,
Fideritiois, and they are numerous
enough to exercise very wholesome
restraint upon reckless tendencies In
the business. A banker now prizes the
reputation of doing safe business.
and cannot afford to have reputation
for inprudence and speculative in
clinations. And yet, although held In
check by these powerful considerations
the pressure of competition carries the
business near the danger line even
nowa There 10 too much competition
for deposits, and the ambitions Of the
more yenturesOme members Of the fr,-
ternity, and the pace they set. puts the
whole system under strain
But what are likely to be the con-
ditions in the business when the publia
II no longer concerned about the HILL
agement of bank, and all the r,.-
wards for conserva tism and restraints
upon recklessness are removed? The
considerations which in the past have
tended to safeguard the business and
advance it's standards would be gone.
The public would care nothing for the
personality of the banker Instead of
looking to the Institution which receiy.
ed the deposits, the depositor would re-
ly on an outside fund. A -uker
might bet all the deposits on ho-se
races without the fact becoming
matter Of any concern to his, custom
ers.
And how would the conservative.
prudent banker fare under these con
ditions? The Legitimate reward for
maintaining that character would be
lost to him He would get no deposits
unless he hid as high for them as his
rivals. for the government would stand
behind the latter, and assure the pub
lie that they were just as safe as he
and tax him to make them 10. In
short the reckless and incompetent peo
pie, who are now either excluded from
the banking business. or held In check
by the dlstrust which discriminating
public feels towards them. would make
the pace to which everybody else in
the banking business would be obliged
to conform or get out of the business.
Would DemoraIi.s Business.
The hardest competitor in any line
Of business is the incompetent or dis
honest man who does anything to get
business Such people get into the
banking business even now. but their
number and influence for mischief
would be greatly increased II they
were backed up by unlimited credit. In
other lines there may be some question
as to the quality or service offered by |
rivals, but all bankers deal In the same
kind Of money, and II deposits were
made joint liability, there 10 no rea-
son why they should not 60 to the
bankers who offer the greatest induce
ments to attract them. The careful |
banker would have no Offset or protec-
ton against demoraliHng competition,
and he would be placed in the strange
position Of being liable for his COM
petitor's obligations.
All efforts to make 1t appear that the
interests Of bankers are on one side of
this question and the interests Of de
positors on the other are untrue to the
facts. Nothing that in the long run IS
harmful to the banking business, that
puts 1t under strain and tends to low
er its standards. can be beneficial to