The Fairmont West Virginian. (Fairmont, W. Va.) 1904-1914, 1911-11-02

Banking REF0RniTQ
EGk WALL STREE
/ MINT DIRECTOR SAY NATIONAL
RESERVE ASSOCIATION NUS
NOT PROMOTE STOCK sPEcu
LATloN. q. M
WASHINGTON, ID. c. Oct. BIC
E: Roberts, Director of the Mint, say,
that the country's banking system
must be reformed in the Interest o.
speculation. He disagrees with Jas
J. Hill that the National Reserve AS
ISOLATION, the proposed plan OF reform
should accept Stock Exchange cola
teral as security for loans, and says
the Association should only loan or
commercial lpaper$arlsi1gs out Of day
to-day trade TRANSACTIONS. a.ss
Il ,thinkSthe organization Of. the Ma
tional Citizens League Is one of the
most promising lsignssof the times
looking to banking sand currency re.
form, says Mr.. Roberts. & ~
This movement Sgotsits first impe,
tus from the panic of 1907. Every.
body knew while. that; panic was gon
that some thing was wrong with our
banking system. There are two
things that are fundamental in bank.
lng::I the banks should be always ready
to meet their cash obligations ON de.
mand and they should be ! always
ready to loan for the legitimate cur.
rent needs'of their customers at some
reasonable rate. In view OF our ex.
perience In the past those two CON
ditions may seem ito make very
large contract but in every other i'm
portant country of the sworllls those
conditions are met. FThere.is plenty
Of proof that properly organized
banking system can meet them. n "
There is an lend to 4 bank 'runsl
whenever IT is.knowns that the indlyid-
ual banks Will be adequately support;
ed, and the amount ofgcredit requir-
ed to- handle the current exchanges
can always be supplied. or course,
no banking system can undertake to
furnish all the credit, that may be
wanted for speculation or extravagant
construction, but 1t can and should
furnish all.that is needed to move the
crops and make the current exchanges
OF trade. q ~, s, X
Our system broke down ins,19O7,
when great railway systems. could not
get money for their pay rolls; tho
movement OF such staples as cotton
and wheat came to a standstill and
hundreds Of thousands OF wage-earn.
ers were thrown out of employment.
Every consideration demands that
the country be safeguarled against a
repetition of this experience. 1t is
more than bankers problem or mer
chants. problem; It Involves stable
markets for the farmer and steady en-
ployment for the wage-earner. 1t is
more. important to wase.earners than
any other single question, more i'm
portant to farmers than a year's crop
more important to all classes than any
disposition of the tariff or trust ques
lions can possibly be. It is now W
for action and ought to have right.of
way over every other issue until Il
is settled by a comprehensive ant
final treatment. 49,
There is no wide disagreement
among the friends OF banking reform
1t is agreed that our system lacks
unity and cohesion and reserve pow
ers. There Is general confidence tina
our banks areG solvent, but no conf
dence that our banks are solvent, bu
no confidence In crisis that they vii
be Athletic maintain cash payments OF
grant needed accommodations TIL,
banks feel their own helplessness, ant
their struggle to keep up their casl
reserves. and reduce their loans d.
even more. to demoralize the situation
than the actions Of the public:
"What is wanted is some respon
sible organization. with reserve re
sources which command complete col
fidence, that will stand back of the II
dlvidual banks and support then
when help is needed by taking owe
some of theirsassets and ADVANCING
cash thereon. Experience eleswher
has demonstrated that the demand
! upon such an institution can be efrec
! ually controlled. by raising the dis
count rate. Thatis the general prlr
4 cipIe 10 which the rest Of the worl
has come, and 1t is npw commoni,
accepted in this country. The onl
l disagreements seem to be over tn
details Of this organization. 3.
81 see no reason to fear that sucl
an organization will be controlled Ii
Z the interest of locality or clique
The controlling board will be chose
from all sections of the country, wit,
proper checks and safeguards, but tn
most important safeguard Is. recr