The Richmond Virginian. (Richmond, Va.) 1910-1920, 1911-10-11
CENTRAL BANK
IS NOT DESIRED
DIRECTOR OF THE MINT ROB-
ERTS DISCUSSES FINANCIAL
SITUATION.

SITUATION.
terest Is expressed in Washington over !
the publication in the American of !
John Claflin's statement announcing |
the plans of the National Citizens
League for a sound banking system. |
particularly at the Treasury Depart |
ment. number OF whose officials are |
nationally known among bankers as /
experts in currency reform.
1t was said at the Treasury to-day |
that in the absence of Secretary Mac !
Neagh and Assistant Secretary Cur |
It's who are out OF town, George y. |
Roberts, director Of the mint, and |
formerly president OF the First Ma |
tional and Commercial National Baak !
Of Chicago. was perhaps best quail |
fed to comment on the Citizens
Leagues plans, Mr.. Roberts being !
one OF the governments experts in |
the banking branch OF governmental |
financial affairs;
so far as the purposes Of the
league Ia outlined in the statements |
Of Messrs. John Clafiin in the New !
York American and John V. Farwell |
in recent magazine article" MIR. !
Roberts said. they do not appear TO |
be antagonisuc TO the general pur- |
poses OF the National Monetary COM |
missions plan, known at times as the !
Aldrich plan
Don't Want Central Bank.
Also, l would say do not think !
any considerable number OF people |
are advocating central bank. 1t Ii |
recognized that the banking field In |
this country Is we'll occupied by ex- |
istlng Institutions, which have grown |
up under the present national and |
state laws, and 1t would be impracti- |
nah fx~ A. IA
central banking institution to com. |
pete with them.
But while our banking system has !
certain definite advantages over the
cAntral banking syBtems Of other
countries. and there II not the slight |
est probability that our people would |
ever consent to do away with our In |
dependent aocal institutions. our sys-
tenn also has certain wsli-known de- |
fects.
Among the defects of our banking
sysfem the chief is want Of organi- |
xatfo;i and cohesion among Numerous
units The effect OF this 10 seen every
time financial strain or panic comes,
wnen each institution, anxious only
1or itself, grabs all the money II can
Get hold OF and uses every effort to
contract loans to protect itself.
Partial Remedy Found.
The banks have found partial
remedy for this by coming together
voluntarily In clearing houses and
adopting common policy BY this
means they are able TO keep omen
and continue to do business, sithourh
they actually suspend cash payments
evidently, this remedy OF coming
tokether and merely adopting q com
mon policy In 4 very crude one; but
points the way OF effective iegis-
iauon. The banks OF the United
states are invuinerahie when their
strength are united. The people OF
community are not afraid OF their
nanks when their forces ara united
Il 10 evident. therefore. that the re-
form required for our banking sss-
tenn 10 some legal method by which
the system as whole can come 10
the aid OF any individual bank or The
banks OF any locality In time of need
This, as l understand IL. Is what
the Citizens League plan tries to
do. But the declaration Of princi-
pies OF the league IL the same as The
principle underlying the Aldrich plan.
IN general way. and II must be
borne In mind that only gensralities
are treated, SO far, by the league az
well a. by tho Aidrich plan. In other
words. neither the league nor the
national monetary commission. so far
a. l know. has yet drafted a Gin 10
Te0h'it w AtHAES1s, hHd IL Is I.tiE
possible bill that should be studied
to SEQ how the declaration OF prtn-
ciples Will work out into law. how
the safeguards will be made.
The Power 0f Note Issue.
The general plan upon which every
one seems TO be working In some Kidd
OF an organization, OF which all thu
banks Of the country shall be mem
hers, which shall have, under cen
fni ~ ~ ~ kA nF
issue. and which shall exercise that
power by receiving approved assets
from individual banks and making
advances upon them. The notes thus
issued would have behind them the
entire banking power OF the eoun-
try: and the association would be Sc
cured by the collateral taken from
the individual banks.
such 4 plan. whether it be wrought
into law by the Citizens League or
the national monetary commission.
would have tina approval OF the bank
tng men. Such an organization would
differ from Central Bank in that
II does no business with the public.
lta relations would be with the In
diyidual banks OF the country only.
II would not disturb the present bank
tng facilities o. the country Tho
q local banks would 60 on doing bust
ness and competing with each other
lust as they are now.
Not Z Money Trust.
ALSO. such an organization would
In no sense be a money trust There
would, under II, be the same freedom
that there IL now to start new baukA
Any group Of people who could get
together the amount OF capital re-
CURED by national and State laws
/ could start u new bank. and. no
long ~ that II the case. II IL. d!f!i-
cult 10 SEQ how anything like bank
anR trust could be established
IAN the plans that ! have seen.
In Mr.. Claims statement, or with
the national monetary commission.