The Jasper weekly courier. [volume] (Jasper, Ind.) 1858-1922, 1911-10-20

come. With headquarters In Washing
ton, II would have ] s or moro branches
IN the various sections OF the
country, and II would be owned
by all the banks OF the country. both
state and national. II should not be
organized 10 make money, but TO rem
der public service. The stockhold-
ers would be limited In dividends 10 5
or 6 per cent. and all further earn
ings, after 20 per cent. surplus had
been accumulated. should go partly TO
the government and partly TO sur
plus.
Functions OF Reserve Agency.
TO hold, without paying interest, all
cash reserves OF the subscribing banks
rreseryes which are OF no daily use
10 o bank, because the law says they
cannot be drawn upon.
ITO hold all government deposits.
and act as fiscal agent of the govern
ment. II would accept no deposits
from any individual, firm or corpora
tion
Under some equitable agreement to
take over and retire all national bank
note issues and substitute its own
notes therefor, based on the same
bond and also on it's other assets
1T should not lend on bonds, but
should give all subscribing banks the
privilege of re-discounting, at same
rate to all. any good commercial pa
per having not over 2S days 10 run,
thus making liquid the good assets Of
any and all banks.
1T might also re-discount CONNER
cial paper having more than Is days
and not more than -four months TO run,
provided IL was guaranteed BY a loch
institution. 70 one of which all banks
In each district would belong. II could
also do business in foreign exchange
and In various forms of acceptances,
as might be worked out I'm detail.
Payments would be made TO banks
from their balance in cashfor national
reserve notes.
Check for the Dangers.
The danger Of an over-expansion
OF credit and notes issued could be
checked by a tax beginning when the
ratio OF reserve 10 all liabilities reach.
ed percentage to be fixed by experts,
and Increasing as the ratio OF reserve
decreased until It arrived at figure
which would be so large as to be ef.
fective as a final check. The brakes
would be put ON so gradually tnai
there would be no sudden Jar, which
would scare all the passengers and
break few bones.
This tax would not be on the notes
themselves. but through the raising
OF the discount rate, would fall on the
banks In proportion 10 the amounts re.
discounted by each bank and charged
weekly as long as reserve was below
the required amount.
The clearing house certificate plan
or its further development in the Al
drich-Vreeland act. would undoubtedly
work we'll mechanically, as far as I,
could go, but psychologically Il would
surely prove a failure, because II calls
the attention OF every one TO the fac,
that the regular system has broken
down
The League VIII not favor a bill i'm.
properly safeguarded as 10 the control,
and wishes additional concrete sugges
tions from any one which will abso.
lutely prevent such an agency from
getting into the hands OF any section
or class. and at the same time keep
II clear Of political influence.
Wouldn't injure Smaller Banks.
AS to the injury TO the smaller
banks, fail to see how such thing
is possible. Now they go 10 their cor
respondents In the reserve cities for
/ rediscounts. With Jointly owned
agency TO re-discount their paper they
would have one more institution 10 &c
10, and that an organization In which
they had a governing interest, and
where. by provision OF the law, ali
would have to be treated alike. This
favors actual sales OF goods. rather
than speculation on Wall street, OF
elsewhere, and also helps the smaller
town because banks In larger centers
are apt TO have a much larger proper
tion OF bonds and less commercial pa
per than tho banks In smaller com
munities.
1T would decentralize control oi
credit and give TO each section OF the
country its Just proportion OF credit
facilities. Nothing else would be al
lowed. since publicity would prevent II
To my mind, II certainly assists the
country banks more than II does the
metropolitan banks. In that way II
builds up the country town and by pre-
serving the independence Of the farm
ers and small merchants helps TO SO
cure the permanence OF the republic.
Times are none too good at present
for the average business man ant
many a person Is out of a Job be
cause OF curtailment In his line. Un
der such circumstances II does seen
as though the voters, and through
them congress. could be brought Il
understand that nothing Is so fun
danfentally necessary to produce Ger
tain and unbroken prosperity as
good banking system. IL Is the foun
datlon OF all credits and all business
and certainly should not be pushes
aside and delayed for other issue
which though very urgent seem 4
many less important II should b
acted upon at the next session OF con
grees.
As I have said In the beginning. 4
the business public this subject 10 o
greater importance than any othe
now before the American people 10
consideration. | believe eur interes
should be aroused In IL, not only OF
account OF the benefits to be derives
from II ourselves, but especially OF
account OF the great good that will b
done to the wage earning element Il