The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-02-06
Aldrich's Plan to Improve the
System Is Intricate and
Far Reaching.
Is NOT UNDERSTOOD
Unification Made Complete
by Combining Reserves,
Discounts, Etc.
tAmerican News Service)
Az JONATHAN WINFIELD.

Washington, Feb. 6.-More far
reaching than is generally understood
IN the plan of Senator Nelson A. Aid
rich. chairman Of the Monetary Com
mission. for an improved method OF
banking. His plan for the rehabilia-
tion Of our financial system was given
wide publicity. but its intricate meth
DDS have not been thoroughly under
stood.
In brief II marks the most profound
and comprehensive attempt at con-
structive financial legislation which
this country has witnessed since the
time of Alexander Hamilton. Hamil-
tons plan was the first step looking
toward the unification of Our banking
syestem; through Aidrichs scheme
this uniflcation IL brought to compile
ton by combining the reserves, the
discount marked. and other functions
of modern banking into one coherent
organization.
One has only to compare the plans
for financial reform proposed n decade
or more ago with that proposed by the
chairman Of the Monetary Commission
TO realize what striking enlargement
of view has been achieved by those
who are studying means Of improving
our banking system. The best finan-
cial thought of the nineties. as en-
bodied, for instance. In the "Batomere
Plan" Of the American Bankers asso-
citation, contented itself with sugges-
tons for more elastic note issue.
During the last three years, however.
under the auspices Of the National
Monetary Commission. the needs and
practices of American banking have
been subjected to fresh and far
more searching analysis than has ever
been made before. Very rarely Is 1t
found that the banking arrangements
OF "a country can be satisfactorily re.
vised by merely amending the note
issue regulations. The country has
been true. for there exists n demand
for other and far-reaching reforms.
According to Assistant Secretary Of
the Treasury. A. Piatt Andrew. the
general deficiencies In our banking
system can be grouped under six
heads. First. the lack of any mechan-
ism OF sufficient range and power to
secure cooperation and uninterrupted
exchange among the banks: second.
the rigidity of banking reserve regu-
lations which result from that fact:
third. the lank of any well organized
market for commercial paper: fourth,
the absence Of flexibility of our note
issue: fifth. the intermittent interfer-
once OF government finance with bust
ness: and sixth. the lack of uniformity
In banking privileges.
For Mutual Service.
Through the proposed Reserve asso-
citation Of America. an institution to be
owned exclusively by the banks. and
to deal exclusively with them. COM
mon bond would be maintained, so
that the banks can be mutually served
The six deficiencies enumerated would
be miminized. Through its prepond.
Grant capital. resources. and its pc.
culiar privileges. ii would exert a wide
influence over the activities of banks.
IL would clear their mutual accounts,
not only within the same city. but be-
tween different cities. and would fur
nish an ever reads and unfailing mar
ket for commercial paper. With such