The Wenatchee daily world. [volume] (Wenatchee, Wash.) 1905-1971, 1909-10-11
REVISION Of NONE.
TARY SYSTEM
PRESIDENT OF THE AMERICAN
BANKERS ASSOCIATION SUB.
MITs FACTS TO SHOW NECES.
SITY FOR CENTRAL BANK. g.

ODnSeO 10 appear " CuAoPO iOA ~
lief in the panic of 1907-is a strong
point of the argument that will be
made to congress by the advocates OF
| revision of the monetary system
of the country. According to the
treasury statistics produced by George
H. Reynolds, president of the Amer
lean Bankers association, in the
course of his statement to that body,
when the first blast of evil times
came in 1907, the United States
| treasury held over one hundred mill
lion dollars more gold than the great
national banks of England, Germany
and France combined, while circulat-
! ing outside the treasury, among the
national and state banks and the peO-
pie was at least twice the gold treas
ure held by all of those great Euro
pean banks. Yet this vast hoard in
the United States was entirely I'M
/ available. The credit of the national
| government stood unimpaired, but
the business interests of the country
were crippled for lack of the currency
which is their life-blood, AMI only a
resort to the issue of clearing house
certificates prevented the panic from
assuming greater proportions than it
did.
Congress must meet this situation
in the near future, for the legislation
! that was enacted a little over a year
| ago was but temporary in it's nature
and must be either supplanted or re-
enacted into permanent law. The
realization of the need for action BY
the national legislature has served TO
direct attention to various projects
! that have been advanced as proper
solutions of the problem, and first
and foremost among them stands the
proposed national central bank. The
others for double reason; it is the
common belief that it will form the
basis of the curative legislation to be
! recommended by the monetary COM
mission and President Taft. in his re-
cent Boston speech, has signified his
own favorable disposition toward the
project Consequently. it is timely
and appropriate to disclose to the
public just what is believed to be in
the minds of the p, esident and Sen
atOr Aldrich and the latters seven
teen colleagues on the monetary COM
mission when they refer to the CEN
trail bank; for undoubtedly, there is
a great lack of information, even
among bankers, upon this subject
Mr.. Reynolds again is probably
competent authority. and in his Chi
cago speech he sought to outline this
important project Here he pointed
out, was to be a bank of the people
and for the people. The people were
to be the stockholders, for anyone
would be privileged to buy the bank
stock just as he might government
bond A small interest on such an
investment would be guaranteed by
the government; any earnings more
than to pay the guaranteed interest
would be shared by the government
and by the stockholders. Political con-
troll of the great bank would be made
at least extremely difficult, by the
life appointment of the officers. In
tegrity of operation would be assured
by board of supervisors, appointed
treasury and the comptroller of the
currency, (subject to the approval OF
| the senate), for alternate terms of az
least eight years to bridge over pOlit-
ical mutations. Thus would be met
the objections founded upon the his
tory of the old United States bank,
that the central bank might be pros
tituted to political uses and be made
a powerful engine for the perpetual
| ton in power of one party. 1t is not
intended that the central bank should
support the credit of the nation; that
must stand or fall by itself. If the
national government needs funds; If
it spends more money than it collects
| by taxation, it must continue in the
old way to borrow money from the
world at large by the sale of bonds.
For the single purpose of this pro-
| jectei bank would be the safeguard
the business interests Of the people
in their private relations. If there
were need for more money for bust
ness purposes, the bank would supply
it by notes and if there were a plea
thora, in dull times. these notes would
be withdrawn rapidly. Governmental
assistance to the institution would Je
limited to the deposit with the central
bank of all government funds now II
the national banks. Perhaps that
feature of the project would be OBJ
nOxious to the existing banks, but
it is hoped that they would find their
compensation in being relieved from
their present burden of carrying the