The sun. [volume] (New York [N.Y.]) 1833-1916, 1910-03-24
PLAN FOR A CENTRAL BANK
PAIL ~. WARBI M al Times
IT ~ DETAIL.


Paul NJ. warburG Of Kuhn. Loeb 4 Co.
VINO has before noN advocated the central
hank idea. outlined his plan for such an
institution a. the meeting Of the Civic
Forum last evening in the West Side
Y. Nc. e. A. building In W-st Fifiy-ssv
cath street Mr. WArburg mentioned
the Payne Aldrich bah and spoke % some
things a. having crept into that bill
through error which ought to hs changed
IL has been minated that Mr.. Warburg's
idaas largely conceded with those % Mr..
Aldrich a. to a central hank plan. hut Mr.
Warburg did not Hay - last night. nor
did anybody else.
Mr.. WarburR was very explicit. however
ion outlining his general plan. which he
aaid he believed Obviated all Of the strong
ct objections that have heretofore been
put forward by the strongest opponents
Of such q hank
Among those on or neer the platform
90 hear him speak were Jacob II. Schin.
Charles II. Treat. Charles A. COnAnt.
Leslie N. shaw. John Harsen Rhoades.
william Y. SpragIe and John Jardine.
In the discussion which followed the
address Mr. shaw took issue With Mr..
WeronrR not 80 much ON hls financial
principles a. on the question Of politlcs.
Mr.. shaw said that good b,lsines. prin-
otplcs and politics did not always agree
Rnd that there vas quite q lot Of politics
y this country and he therefore thought
A part 81 Mr.. Warburgs paper dealing
directly with details OF the central bank
plan follOws:
The plan here submitted does not suGEess
q central bank a. such east In European
countries. u - scheHs ha~sd upon con-
dstions peculiar To our country and to our
form % e0vernmenf A. such IL recognizes
the vast territorial area of the lni,ed states.
the diversity amt dl@similarity of interests
and even the traditional. ctiOnal aud
partisan preiudice- of the p~ople
let ~ assume that q united reserve hank
of the I nited states viii ~ estAb lished in
Washington With y capital " sIce. 90 M
states viii be divided into. iet 40 -ay, twenty
zones 81 operation similar to rhe currency
association distTi'ts proposed h.
the Aldrtch- Nreetsnd measure, each zone
Of operation TO contain voluntary $3.50
citation 81 hanks grouped around q certain
financial and commercial centre TO form
the operating ascot atiOns which Ne shall
call banking as-oC iatlon-. the hanks within
each 1one should have the privilege of ap-
pointing from their own numher = board NJ
directors. Who IN turn may appoint pre~i-
dent or managing director % Inc a-so-is-
ton Certain mistakes Whtch 'Tepi into
the Aldrich- vreelsnd ball must NJ avoided.
The measure SHOULD no drafted so - In p~T-
nit q hank to Withdraw from the as-ocla-
ton ~ wilt. 90 restrict the obligations Of
each hank TO certain transactions. IN each
case carefully examined and approved nv
the assoc ions. aud also to ems bic The
associat ions, Nith The approval Of the Secre-
tary of the Treasury. TO group themselves
into subdiV isions
In order that the board Of directors Of
the unttgd reserve hank In Washington may
10 thoroughly representative OF the various
Interests and districts 81 the country. that
Il may he non polii ical non IA rtizan ana
non-secttonal q certain numher 81 th. d.
rectora, aay three hfths should be ap-
pointed by the banking as-oc ist ton. q FUR
Their NUN her should hs elect 81 hv the
ss0okhalders while the Secressry Of the
Treasury. tAe Comptroller Of the Curreacy.
the Treasurer OF the { nited states and some
osberp to be nominated BY them should an
out the rena inder Of the board
In Ordsr that commercial interests 10
adequately represented the provision might
be MADE that the uembers 20 ~ appointed
BY the stockholders should not - hank or
trust COMPANY presiden,s and Thai these
members should h. elected prsferenttaIIy
from the class ~ merchants and manu-
factuFers one would then have mixed
board, 81 which ~ per cent would h.
bankers appointed hy The bankinE $3.50
Citations while The remaining 90 peT cent
would he made up one half b. The CONNER
ctal cIassss elected nv the stock holders q nd
ene-hntG nv the ~ oracio rnsmbe+s Of The
Government, and The additional msmh~rs
whom they might appoint
This board should have he rtshf u, sIe.t
one OF tWo governor ~ The united reserve
bank. Who would no .Alaried officer. ana
Who souId be appointed like other nank