New-York tribune., 1910-01-18
WILSON TO BANKERS
CALLS THEM NARROW
MacVeagh Makes Plea for
Real Cash Reserve.

| applauded most at the annual dinner OF
| their association last night was their Sc
verest critic, Woodrow Wilson. president
of Princeton. He termed them the narrow
inhabitants of a provincial city. and called
upon them the leaders of the country 8
financial undertakings to develop true
craftsmanship
Franklin MacVeagh. Secretary of the
Treasury, was another speaker and the
third was r. Hopkinson Smith Senator
Nelson w. Aldrich, of Rhode Island, chair
man of the Monetary Commission. was 20
have addressed the gathering. but was kept
away by illness.
1T is embarrassing for me. as a Demo
crat." began Dr. Wilson, "to stand in the
place of Senator Aldrich. If I really did
stand in his place the policy of the country
might be altered
'I am called upon to attend the dinners
of many different kinds OF organizations.
mostly those of men engaged in some par
ticular calling, and I am tempted to ques-
ton whether in such an association as this,
gathered together on the basis of a COM
mon occupation, there is not some danger.
/ am not sure that you. as bankers. can
regard the problems of this country broadly
enough.
There ought to be a particular states
manshlp developed by each great calling.
In no calling is this more true than among
bankers. I have been led sometimes to
think that bankers do not trust the coun-
try, and that is why the country does not
trust YOU. I do know that there is too
great concentration of the thinking of
bankers in the city of New York.
The speaker then went on TO say that
New York did not understand the country.
great problems it had become provincial.
He deplored the fact that the greater part
of the funds of the country should be han
died in this provincial place, in provin-
cial manner, and he declared that IL the
bankers of New York were to keep the
precedency In banking affairs of the nation
they must become interested in the little
enterprises, as well as the big; that the
future of the country lay In the hands of
the little borrowers. He continued:
This country will never be satisfied
and ought not to be satisfied with any
banking reform which does not put all the
banking resources at the command of the
people. The only institutions that are do
ing this to-day are the insurance COM
panies.'
He closed with the following plea:
L beg you gentlemen not 10 think Of
slider mine as your own voice calling you
to the service of the great country we
love"
Mr. MacVeagh thought that since the
United States had become a world ma
t1on, as he expressed it. il needed a world
banking system; that such a system must
rest on real banking reserve and that
the country could not have this reserve as
long as 1t refused to lodge somewhere ''the
power of continuous expansion and con-
traction of the currency in accordance with
the needs of business"
DEGREES PRESENT RESERVE.
He said the present banking reserye was
one only in name. and that really the pres
ent system was directed to preventing the
accumulation of a reserve. Our financial
no-system," he said, breeds panics, lust
as certain districts used to breed spasms
of yellow fever"
The Secretary of the Treaury said he
would not propose currency reform in
detail until the Monetary Commission had
reported, but he thought that meanwhile
the more general phases of the question
might be pondered with profit In regard
to the adoption. partially or in whole of
successful foreign system. he continued:
1t seems to be necessary that we should
have a financial system that is the out
growth of our own national character and
our own national situations. In the end
our system must so far conform to the
financial systems of all the great financial
nations as to fit us for a share in the work
of the worlds monetary operations and TO
compete for their advantages and profits
But, on the other hand, there seems to
be a. certainty of more ultimate dissimilar-
lty than or similarity between other sys-
TENS and our own
And when we have wisely adjusted our
selves and related ourselves profoundly to
the financial systems of Europe, we shall
American system OF banking and E1ir curreneV eV
that will be distinctively our own So that
such question as that of a central bank
for example, does not depend entirely upon
the success of the central bank in Euro
pean finance; though that success being
great presumption in its favor. The re
naming question is the chief one which
is as to whether a central bank of the
European order can be introduced into our
system 50 that 1t can perform the same
useful Office that it undoubtedly performs
in European finance
! think we will have TO wait at least for
the report OF the Monetary Commission
before we can finally answer that question.
notwithstanding the able discussions of the
subject that are being made.
Mr.. MacVeagh went on TO saw that fur
ther issues of Panama Canal bonds should
be at rate of interest that would allow
them to go into the general market and
into the hands Of genuine investors. The
government had s7S0too,ooo of per cent
bonds outstanding, he said, which because
their rate CT interest was much below the
measure of the governments credit. could
be handled only by national banks to Sc
cure circulation or government deposits
He added:
Now, in issuing new bonds either to re
plenish the cash IN the Treasury when that
becomes necessary, or TO fund the present
debt of the Panama Canal to the Treas
ury, or 70 pay for the canals further CON
struction, my feeling is, and the feeling is
very strong. that we are bound to see 10 N
that the new bonds. If We issue then-and
l hope we may be able TO issue them. IL
we have to issue anythins-shall not he
permitted to pile themselves on the
top OF This inert. this stagnant- mass of
s130.0OO.00o of 2 per cent bonds. we hsva
certainly issued enough bonds that are
practically unmarketable. and the loss or
Art EXHIBITIONS AND SALES.
Eif + n Ar,c4:o