Evening star. [volume] (Washington, D.C.) 1854-1972, 1909-11-12
.TOADAPT, NOT IMPORT
Not Proposed to Take Foreign
Currency System.
RADICAL CHANGES NEEDED
Senator Aldrich Talks to the Iowa
Bankers.
MONETARY COMMISSION PLANS
Describes the Use of Commercial
Paper Abroad as q Basis of
Circulation.
COMMISSION PLANS

NE have any credit organization at all. We
propose that it shall he an organization
which shall be the servant and not the
master Of existing banks" said Senator
Aldrich. addressing the local bankers
club last night on the necessity for the
reformation of the banking and currency
laws to provide against panics like that
OF 1907
Il concede freely that any institution
or organization which we may adopt
must be one that can be fitted into the
existing system. and any changes that
are at all radical in their nature-and l
am inclined to think that I'm some respects
we shall have to make some changes that
will be scientific and radical in their
character-must be made with view of
adjusting them to our existing system"
No Offensive Reference to Cummins.
This is the home of Senator Cummins.
who has shown an inclination to antago-
nize Senator Aldrich. The only allusion
to Mr.. Cummins in Mr. Aldrich's speech
was made In connection with a mention
of the name of the late Senator Allison,
and there was nothing that could have
offended friends of Mr.. Cummins in the
remark
Mr. Aldrich was the guest of honor at
Il OlHueT Ut TIE 0dNeTy I1otcf W.
Rounds. president of the bankers club.
introduced the Rhode Island senator.
whose reception was most cordial.
Mr. Aldrich spoke especially of the
fording the best reason why the people
OF Iowa should desire stable banking
system. He appealed to them to join
with him in devising a plan that would
place the United States I'm advance of
all other nations as a financial center.
Commercial Paper in Europe.
Here he gave somewhat more attention
than elsewhere to the important part
that commercial paper plays in the bank
ing systems of the old world. This. he
explained, was not done for the purpose
Of urging the adoption of the European
plan in the United States. but to indi-
cate a possible means of increasing credit
In case it should be found desirable to
go abroad for suggestions looking to an
Improvement on our monetary system. In
his discussion of this feature Of foreign
banking Mr.. Aldrich said:
I'm Germany all notes, taxed or I'M
taxed. must be covered by an amount of
sue and an amount Of bankable bills equal
to the other two-thirds. Those bills are
what We would call commercial paper.
They must bear the names Of two solvent
parties, and must not run for more than
ninety days to answer the standard fixed
for bankable bills. In France they have
a provision that what are bankable bills
there must bear three names, and must
be written the same limit as to time as
the German bills. In Great Britain the
custom is to require two names of Eng
lish citizens, one of whom must be ac-
ceptor.
Paper Here and Abroad.
"Of course. YOU are aware Of the diff
ference in Technology of our commercial
n,,r
sorry notes. either with a single name or
with indorsers. No such thing as prom
issory note Is known in the ordinary ex-
perience of any Of those countries. They
do give form of obligation. with mort
cages and sometimes with collateral,
ton to our form Of promissory note.
There IL wholesaler sells a retailer
goods Of any kind. or a dealer. wholesale
or retail. sells to customer any article,
the wholesaler or the merchant, whoever
he may be. makes a draft upon the pur-
chaser and that draft Is accepted, and the
paper is known as bill of exchange. 1t
is for a real transaction, and those bills
are banka BILE, and they are the foundation
of the credit system Of the countries
have named.
Mr.. Aldrich took occasion to explain
that in referring to foreign banking sys-
TENS he had no intention of urging the
adoption of any of them.
Importation Not Proposed.
'In making this statement to you as
to the character of these banks l do not
want to leave any opportunity for any
misunderstanding whatever" he said. 1T
Is not the purpose of the commissioner
certainly is not my purpose-to try to
make any part of the American people
believe that any Of these systems could
be adopted In the United States; Ger.
tainly not without very important modif-
cations. And am not presenting to you
TONIGHT this matter with a view of con-
vincing you or of preJudicing yOu or lead
ing you to think for moment that or
any of the members OF the commission
believe that any of these systems could
be adopted by the United States.
THE habits of the one people, the rela-
tions which exist between banks and bor-
rowers and banks and depostors In tho
25 600 independent institutions in the
United States, all related to the develop
ment Of various communities. must be
ed in this country that does not recog-
nize the fact that the continuous exist
ence of these banks and the prosperity
of their business must be maintained. or
come: but we cannot overlook the condi-
tions / have named. and 1t Is not the
purpose Of the commission or Of any
member of it to ignore 1t.
Aldrich's Tribute to Allison.
Senator Aldrich paid the following
tribute to Senator Allison's memory:
IT cannot leave tonight without making
one allusion which is to me personal
When this commission was appointed
was made chairman by reason Of the
fact that I was at the time at the head
of the committee on finance and the sec
ond name was that Of Senator Allison OF
Iowa. -.
II was associated with Senator Allison
for twenty-seven years as member or
the financial committee, and 1 was con-
nected with him in all the work or the
Senate during that time. By that time
I had a personal association with Mr.. Al
lison which is the pleasantest memory OF
"He was one Of the best and wisest OF
men. Ny association with him was a
constant source of delight. and my
memory of years will last as long as life
lasts.
HER ELECTION Is LEGAL.
HAA