New-York tribune., 1911-02-28
TELLS WHERE MONEY GOES
Cashier Of National City Bank
Addresses Westchester Bankers.
FAvoRS THE ALDRICH BILL
superintendent Cheney First to
Speak at First Dinner of .
New Association.

me wes;ehester County Bankers came
sowr 70 Delnonico's last night for the first
annual dinner OF their newly formed asso-
station. and before they began 70 hurry
,rzy for the 1910 train Arthur Kavanagh.
,..bier Of the National City Bank, gave
,nsn, few hints OF what became Of the
.synlus funds they sent from their banks
~ this city. and advised them TO get busy
,rnsdiately to head OF Wall Street while
some OF the money was left.
Mr.. Ksvsnegh made a few pleasant re-
rsrks about the atsvistic national banking
rs,en. calling attention 20 the fact that
,,,-e we're twenty-five thousand national
s,nks IN the country. each with a separate
ress-ve. and no possible way OF combining
those reserves for united action in time Of
,,ed, and then offered the comments and
advice that caused the men from West
,hsstsr to drag out time tables and hurry
,o- the l0:S0 train with their hands on their
pockstbooks.
New York" said Mr.. KavanaEh, "is the
r-estsst secondary reserve city Of the
eorutry. and the money that comes to this
,ity as a secondary reserve centre Is loaned
the QeNldNCS ol d pdl t4INldl NLdeS-lilS
,n,calato-s and some investors.
The objection 10 a bond secured cur
,ency Is that Il is not responsive TO the
demands fer currency. but fUctuates in
volume according to the price OF bonds.
The objection 70 lending the secondary re-
n-ve OF the country TO Wall Street specu-
la'ors IS that the demand fiuctuates with
,he needs OF speculation. In the great
Furopeah banking centres money is loaned
On commercial paper. and the demand
fpotustes with the demands OF trade and
Is rot subject 10 the violent changes Of
,ne-ulative fever. Il takes only couple
81 weeks N start a speculative movement
IN New York
Mr.. Ksvauaeh said that the remedy for
,h-s condition Of the money market lay in
,ha plan suggested bv Senator Aldrich for
e contra reserve bank. and urged the mem
As-s NJ the Westchester Bankers Associa-
ZION &c 40 all that they could 20 secure the
n,ssavs ot the Aldrich bill by Congress.
Another sdvantage to be had in the pas
,ago of Tho A'drich bill he said. would be
IN the great assistance 20 the foreign trade
CT the country
American manufacturers had outgroVn
the home market he said. hut the Ameri-
can irving 70 sell abroad was handicapped
~ having no American bank 70 90 70 for
us foreign accommodat ton. The American
,slesran must now seek in a roundabout
usv the aid Of some foreign banking house
for the accommodate he needed in carry
;nr on his foreign trade. With the Aldrlch
pisn adopted, said Mr.. Kavanagh, Ameri-
cars doing business abroad could conduct
their money affairs with their own country
men.
n II. Cheney. state Banking Superin-
tendent. was the first speaker at the din
ner He explained that the differences be-
tween the parish priest and the banker was
that Il the banker went wrong he hurt
.vsrv nan in the community. while the
priest lost only his own soul.
FojloVyiug out this train Of thought ne
ssid that the public often wondered why
hank r1anipulators were allowed 20 20 50
fsr With their schemes before they we're
caught Bank manipulators were very
clever men. Mr.. Cheney explained. but IL
,hsv only kept on long enough the oank
,-as sure 10 be wrecked some DAY, ana
their Guilt would find them out
With the exception of Mr. kavanasn
,n hi, remarks about Wall Street loans
.h.~e seemed 70 be a general desire among
The sneakers 70 Put their faith IN genera,
ives Lawrence L. Gillespie. president oi
ne trust company section Of the American
Bankers Association, drew moral. IL va.
esnsraIlv accepted. from the experience oi
the carnegi, Trust Company. but ne men
toned no names. ~,
.-rroro q spirit Of rivalry" said MI 'T''-
jssnis there is a temptation 10 depart
f-on, rractices and regulations which time
and experience have shown shouio De III
ssnars bic from cautious and conserVa''.
.snking Rivals that in recent periooS
rave been paying 700 high for the business
t,st By such methods they were aoie ~
secure. and were themselves cohstrSiheo
n accent hazardous and correspondent
higher paving loans in order TO meet ihe"
cxnenses and be in a position TO dlstIlnu'e
earnings 10 their stockholders. II they nave
succeeded in escaping the rocks durlns
reros Of financial depression, have usua'l!
done so in a wounded or MANNED CONDITION
certain gradually TO become apparent ="
hfe public. and leading before long 10 'l'e
scaI where all debts have finally TO De se'-