New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1911-02-09
URGES A CENTRAL BANK
CONGRESSMAN VreeIand Speaks at
Y M. C.. A. Finance Forum.
PLAN LIKE THAT OF AlDRlCH
Members Also Hear Cotton Elk
change President on That
Staple in Finance.

,~.,,ressn,an Edward b. Nreeland dis
- The needs OF a central bank at the
ting Of the Finance Forum at the
~, side Young Mems Christian Associa-
-, last night. Arthur r. Marsh. presi-
1o,, Of the New York Cotton Exchange
,rote on Cotton in Commerce and FL
.s,ce Some two hundred members of
80 forlm crowded the association audi
I'm and listened with interest 20 the
discussions.
roreressman Vreeland pointed out the
e..-s according to his opinion, in the
.,ssent currency system, declaring that
-, svstsm was entirely inadequate in
.,r,es ~ financial stress and panic. He
..,,,ed his scheme for a central bank.
,b,cb he said was substantially the same
,bs recent plans for such an institution
..-.se,,ed by United States Senator AL
drich.
The trouble with our banking system
,e said lis that it falls apart in times OF
,-o,,hle. Nearly every other country has
,bo branch banking system, but we can't
,n,roduce II here In the face Of the 5000
ts,kinr institutions I'm this country. ono
ching we need Is an honest, unselhsh and
Intelligent leadership great central force
:, the banking system. 4 second fault IN
,bs prssent system IS that we have no re-
eronsible hands in which to conserve ana
,-otsct our gold supply and further, we
r,vst DEPEND upon our bank notes 10 as
,rra an elasticity In our money system.
Then We lack an adequate reserve sys-
,ero we are the only great country where
,bs law requires the banks to keep large
rash reserve on hand-in other countries 1t
,s left 10 the discretion Of the bankS-and
We are the only country where the sys-
fen, breaks down in time Of stress When
financial trouble IS threatened instead OF
rnaesirr our reserve. every one Of the 5000
hanks in the country fights each other 10
get hold OF every dollar it can. It is
matter Of self preservation with them and
not their fault. but the fault of the sys-
ism.
Advocates Foreign Systems
Congressman vreeland said we ought TO
rroht by the experience of other countries
and adopt some Of the foreign systems. be-
cause they had averted ranics in those
countries IN nearly every one Of the for
sirn countries are found two great princi-
ples. he characterization Of cash reserves
and concentration Of note Issues under gov
eminent control ard supervision
He advocated a central bank. 20 be
known as the United States Reserve Bank,
with a capital Of az least s10O.oO0.oo0 in
gold. the stockholders 10 be limited to ns-
tionsl banks and state banks wiped out,
The directors 70 be elected on g seograph-
zeal basis, with the Secretary OF the Treas
ury and Controller Of the Currency IS
directors ex-ofiicio. and the amount Of
stock 10 be owned by any bank limited to
{ per cent OF its capital and surplus He
argued that no interest should be allowed
on deposits, that Investments should be
limited 10 commercial paper and public Sc
curities Of the United States. and that the
central bank should hold part OF the re-
serves Of the branch banks.
NJ. Marsh clearly outlined the methods
Of conducting business on the Cotton E1-
charge ana said that something in the
line o. central bank was needed 10 pro
vide The money with facility in carrying
on the cotton business.
Mr Marsh defended the practice on the
Gotten Exchange OF selling contracts for
The future delivery Of cotton, which the
recent Scott bill passed by Congress sought
70 prevent as form OF pure gambling, he
said