The Farmington times. (Farmington, St. Francois County, Mo.) 1905-1926, 1909-03-12
THE ALuRICH.V REELAND
BANK CURRENCY LAW

BANK CURRENCY LA"
Writing to the Chicago Banker
issue of February -, John Schuctte
pr.-iio.' ot tine Mauitowoc Saving,
Bank, Mauitowoc, Wis., says;
Tn. ~ lrich-Nrcolaud bill will dis
close to any one looking sharp that
it hl. "a uilarr iu tHr wood pile
When ;ris bill wa, uu|.r considers
tiuu. .a even uir~' it was passed,
nearly an believed THAI only the
emergency currency which might
De ISSUED under It could h" secured
by United state. h.u.. "g other
securities, ana that 'ho security
against the old national bank notes
would remain unchanged, so tHat
We would have two Kinds 81 bank
notes, the old, secured 10y United
Stato+ bonds exclusively, wl tho
new emergency notes, secured hE
United States bonds cor other -''uri-
tics. "Othrr securities, rs unln"d
in an" act, may consist eft state,
municipal, railroad huuds, or com
morciul notes. This, then, is the
general acc"ptnuc" ui th"proyisions
of lHr Aldrich-Nrr"laud act: but
now let me explain how it is entirely
different
The leading spirits in securing
this legislation realized that the
emergency currency, tn" security of
which might hc questioned, as it
might consist mainly Of commercial
notes, would not ne accepted by the
public rs quite as SAT" aS the United
States bond secured notes, and to
make all alike in the eyes of the
people, they lowered Tia" security of
the old national bank note To the
lower level of emergency bank note,
and this was accomplished by an
amendment to the national bank net,
which only required the adding of
three words, cor other security af- |
ter the words "Unitcd States
bonds
Since the passage of the Aldrirh- 7,
Nrccland act, all rational bank notes !
printed 10y the government state up
on their face, "sccur"d by United |
States bonds or other securities
Since then, not n dollar of rmrrgou-
cy currency has been issued, while
many of the notes have been issued |
to banks in exchange for mutilatcd |
bills; and such bills, although sccur- |
ed 10y no other security than United |
States bonds, state ON their face, |
"securcd by United States bonds or
other securitics;n this really is II |
deception. ! can not see any reason |
for this but had one, aud that Is to
prepare the way for asset currency. |
While an emergency currency act |
might have been drawn to give some /
relief In II money stringcncy, the !
Aldrich-Nreclaud act has actually |
done harm in that it dcprcciatos all |
our national currency.
Before this act was passed, all |
knew that the national bank note
was secured by United States bonds, |
exclusively, deposited with the
United States treasurer, as this was |
plainly printed on their face. But |
when they now find that this has |
been changed to read. "Securcd by |
United States bonds or other sCcuri- |
ties" aud the line deposited with |
the United States treasurer left out, |
it is serious question whether the |
people will not lose their unboundcd |
confidence in our currency, as soon |
rs they will get acquainted with the
real meaning of the act.
Although some may not be greatly |
alarmed by this, yet you can not
convince the people that railroad |
bonds, or commercial notes are as
safe rs United States bonds, especial
ly In a panic. fear that as soon as
the real character of the fact is
generally known, and we have a
financial crisis, the Gresham law
will begin TO operate, which means
that the depOsitors will draw gold
and hoard it, instead of national
bank notes, which would be far
more serious. As this act is decep-
tive, misleading, and may under
mine the confidence In our whole
currency, therefore it ought to be
repealed ut the earliest moment.
rouNry ExpERIMrNr STATToNs