The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-05-19
END BANK PANICS
BY ALDRlCH PLAN
Banker Says Scheme Will
Safeguard Nations FL
nancial System.

n0nClaI SySteH.
Dallas, Tex, May 19.-George NJ.
Reynolds. president OF the Continen-
tai and Commercial National bank Of
Chicago. was the principal speaker
before the annual convention Of Texas
Bankers' association In Dallas. He
spoke on Safeguards Against Recur.-
ring Panics." his address being an ex.
PLANTATION Of the proposed Aldrich cur
Tency plan and q plea for Its adoption.
He said In part:
'Panics have overtaken us an the re-
suit Of multiplicity of causes. princi.
pal among which has been our failure
20 MAINTAIN at all times the proper re-
lation between credit and actual mon
~. which must be held to make credit
stable.
Having had q close association
with the chairman and members of the
national monetary commission. know
that they kept constantly in mind
three underlying principles which
were regarded a. being necessary to
the successful operation Of any plan.
First. that any plan adopted should
provide . method through which II
would be possible for the banks of the
country to furnish credit In proportion
TO the reasonable requirements of bus.
iness: second. that the notes issued by
Il 40 q circulating medium should be
scientific to the extent that they would
possess . proper measure Of elastici-
~; aid, third. that proper safeguards
against overtaxation of credit or over
taxation In business should be provid.
cd.
ITO my mind the tentative plan
monetary commission has proposed
and which 10 founded upon these three
essential principles covers our needs
remarkably well.
III we take into consideration the
fact that the large banks In the CEN
trail reserve cities will have the same
privilege Of discount with the Nation
81 Reserve association that your small
Ter banks In Texas and other sections
OF the country will have, I think you
will agree that It will provide the facil-
tiles for m amount of credit necessary
70 meet all. ordinary or reasonable re-
Quirements. The major part of the
business conducted by the National
Reserve association. II formed. will be
made up Of transactions Of this char.
actor.
1T 10 expected that the larger banks
In the central reserve cities will give
TO this institution. In the event of its
organisation. large percentage Of
their cash reserves, which reserves
have heretofore been carried in their
vaults year In and year out.
THE plan which has been proposed
provides all Of the essential principles
necessary for the reformation Of our
currency system. II restricts our pres
emit national banking system only to
the extent that II proposes to relieve 1t
Of the right Of note, Issue and serving
- government dcposltories, which de-
posits Il proposes shall be kept with
the National Reserve association.
"Thus the plan a. proposed 10 not In
any way revolutionary In It's charac.
ter: on the contrary. It augments the
present system. and gives to the plan
ter In Texas an assurance that II his
crop In his storehouse or the live stock
81 his yards warrants the extension Of
credit to him. by his local bank he will
secure that credit. for with the adop.
tion Of this plan into law II insures
70 his local banker an ability to dis.
count that planters paper with his re-
serve correspondent. II hesprefers, CT
directly with the National Reserve as
ISOLATION. provided the paper does not
rum to exceed twenty-eight days. and
also that II has been dated thirty days
prior 70 the date upon which 1t 10 Of
Tered for discount. The bank In . re
serve city which discounts this paper
for it, correspondent, In turn 10 given
On assurance that in case Of need Il
can expand it, credit through the re
Oefve association to the event of en-
abling Il to maintain proper reserves
against it, liabilities.
"The plan for q currency and bank
Ing system proposed BY Mr.. Aldrich Il
generally regarded a. possessing all Of
the fundamental principles necessary
20 meet the requirements Of our rapid
~ growing business and Simultaneous
" furnish proper safeguards against