Daily press. [volume] (Newport News, Va.) 1896-current, 1909-10-06
som THING ABOUT PROPOSITION
George n. Reynolds Defines II AS "A
Bank of the People and BY the
People"-Purposes OF Such an lnsti-
tuition and How II Would be Aided
by Government.
(By Associated Press.J

w ASiil.Nt ONs ~. ~ wv .. ~
/ coming congress must meet situa-
ton born OF the panic OF 1907. when
the issue Ct clearing house certificates
by the government to supply sufficient
currency to meet the demands OF the
business interests Of the country. was
necessary although Americas Golfers
were Overlooking with gold. Foremost
among the various projects that have
been advanced rs n proper solution or
the governments problem stands the
proposed national central bank.
As IL is the common belief that II Will
form the basis of of the curative leg
islation to be recommended by the
monetary commission and because
President Taft. in his recent Boston
speech signifies his own favorable dis
] position towards the project. 1t Is
timely to disclose to the public what
! IS believed to be in the minds of the
! President and the eighteen members
of the monetary commission when
/ they refer to the central BANK.
"Of the People and For the People"
/ "A bank of the people and for the
people, is the definition of this insu-
. tuition made by George II. Reynolds,
president OF the American Bankers
| Association in his Chicago speech. He
pointed out that the people were to
be the stockholders, for anyone would
lie privileged TO buy the bank stock
just as he might a government bond.
, A small interest on such an invest
ment would be guaranteed by the gov
eminent: any earnings more than suf-
ficient TO pay the guaranteed interest
. would De shared by the government
! and by the stockholders.
Political control of the great bank
would be made extremely difficult. by
the life appointment of the officers.
Integrity of operation would be as
sured by a board of supervisors, APP
pointed by the president. the secre-
tary and the comptroller OF the cur
Iency (subject to the approval of the
senate1 for alternate terms of at least
eight years 70 bridge over political
mutations Il is not intended that the
central bank should support the
credit Of the nation. Et the national
government needs funds it must con-
time to borrow money by sale OF
bonds.
Purpose Of the Bank.
The single purpose of the bank
would be t. safeguard the business in
teresls of the people in their private
relations. If there were need for
money for business purposes, the
bank would supply il by notes and II
there were a plethora in dull times,
these notes would be withdrawn rap
idly.
Governmental assistance to the in
stitutiOn would be limited 10 the de-
post with the central bank of gov
eminent funds now in national banks.
There would be no interference with
the most profitable feature Of the
banking business for the central insii-
tuition would not receive deposits from
individuals
The question as to how the bust
Bess man is TO benefit by a central
bank is though; 20 be answered by the
statement that the project would in
clude a provision for the acceptance
q good commercial paper as a basis
for the issue Of money. Such paper
would represent local transactions be-
tween solvent c0nccrns-all short time
cred.ts-and sure to be retired when
! ever the tranSaction-thc sale and de-
Hyery-was concluded.
There viii be Opposition.
This explanation briefly is a bare
outline Of the manifold details that
probably will be laid before congress
as an accompaniment OF the report
of The national monetary commission
That g viii meet with opposition. can
not be doubted and this. too. In spite
90 the best efforts Of the administra-
tion TO present the matter regarded
a. non-poiitical
The sugxction Of a central bank al
ready has agitatcd deeply the great
banking interests. the line OF division
beginning az the last bankers couven-
tlon q. Chicago.
Many - the hank officers regarded
the prof, . deep suspicion. They
we're tod that no cncToachment upon
their business vas contemplated be-
v0nd the Withdrawal from thcir build
INK vaults II the governments funds
but they regarded the measure a. the
opening wedge fcr the destruction 81
the most lucrative portion 81 fhcir
business and viewed with anything
bur favor where The government bank
was 20 enter into competition Tor the
lcn0rm0us discount operations which