The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1910-02-19
DONE ON CREDIT
Over Half of the COuntry's Bust
ness Carried On
BY Means of Checks and Other
Forms of Paper.
ELEMENT OF DANGER
Says DIR. Kinley Who Has Made
an Investigation.
Ought to Be Some Means of In
creasing Currency.

Washington, Feb. 19.-"We are JUS
titled in concluding that so or 60 per
cent of the retail trade of the country
is settled by means of checks and
other credit instruments. Over 80 per
cent OF the wholesale trade is done
with credit Instruments
Such are the conclusions of DR..
David Kinley of the University of Illi-
nois, expressed in a monograph which
the national monetary commission will
issue in a day or two under the title
of '"The Use CT Credit Instruments in
PAYMENTS in the United States"
During 1909 DIR. Kinley made an in
vestigation of this subject through the
fundamentally of the commission and
the comptroller of the currency. In
terrogatories were sent to all kinds of
banks.
The aggregate retail deposits on
March 16, 1909, the day on which the
banks were requested to report their
retail deposits, showed some interest
ing facts, according to DR.. Kinley- The
largest amount of deposits was in the
returns of the national banks. where
the percentage of checks was 74.7, the
highest shown by any class of banks.
The loan and trust companies next,
with 1877 per cent. but their total de-
posts were only about one-eighth of
those Of the national banks.
The third in order of percentage
was the state banks and the percent
age of credit paper in their deposits
was 20. amounting to about 40 per
cent of the national banks. The pri-
vate banks, with less than a million
dollars deposits. showed 6S.4 per cent
of checks, while the stock savings
banks, with deposits of less than $780,
900, showed 64.1 per cent in checks.
The mutual savings banks showed 1913
IN OH in, Of IacC
than $4,000.
The highest percentage of checks
employed in retail deposits was in
banks in Wyoming. There the ratio
next. with sos per cent. and Oregon
third. with SOL per cent. The only
two states that showed a percentage of
checks less than 60 per cent were
Maine, where the percentage was SIS
of deposits reported, and Rhode
Island. where it was 56.5.
DR.. Kinley says the use of checks
is promoted in a measure by the pay
ment of wages in checks. OF week
ly payrolls reported by the banks 70
per cent were in checks.
1.-THE transaction of SO large a vol
ume of our business by checks is an
element of danger in times of string
ency and crises says DIR. Kinley. 'In
such times the uncalled for balances of
credit transactions create a larger de-
mand for money. but the habit of set
Ting by check has meantime kept the
available amount of money at a mini
mum.
consequently there ought to be
some means of supplying additional
currency when credit as a means of
payment diminishes This currency
ought to be as safe and as uniform as
the ordinary currency
1.-THE volume of credit transactions
very likely tends to increase popu-
lat1on and business grow. 1t does not
| increase uniformly, however, but by
periodic movements; that is to say the
rate of increase of credit transactions,
as. compared with the whole volume
of business, grows. as it WERE by jerks
and at a decreasing rate"