Tonopah daily bonanza. [volume] (Tonopah, Nev.) 1906-1929, 1912-03-06
For preSident---I9I2
WILLlAM HOWARD TAFT,
Of Ohio.
FOREIGN MONETARY SYSTEMS.


Nelson W. Aldrich president of the national
monetary commission, is competent judge of the
banking and monetary systems of this country
I'm his opinion comparison of the system of this
and other countries proves that ours is antiquated
and inadequate to meet the needs of the day We
have some twenty-five thousand isolated banks
which the law renders pOwerless to cooperate III
sustaining the credit of the United States In an
article in the Independent Mr.. Aldrich says this
is absolutely fatal for invunerable credit is what
we must have to insure national development.
This country has received many warnings The
panic of 1893 should have been sufficient one
vet we had the bankers panic of 1907 and still
the same dangers threaten us Even the railroads
had difficulty in getting currency to meet their
rs'aN rolls. and there few weeks in 1893
i,es8 Nier railroad and carshop employees
throughout large part of northern New York
Acre paid in Canadian bills When the strongest
banks in New York City had to throw out rail
road pay checks certify them for cash payment
through the Canadian bank at Hamilton or some
border point the breakdown of our monetary
system became complete. The banks did not fail
They were perfectly solvent but currency had
practically disappeared from circulation It was
almost as bad in 1907. though the country was
really prosperous on account of good crops and
remunerative prices but the crops had to be
moved with foreign gold, while our country banks
sat tight Of actual cash in their vaults
amounting to sixty-fve per cent of their gross
liabilities
Officials Of the India office have found it i'm
possible to keep gold in circulation in British
INDIA ON account of the boarding propensities of
the natives This renders it necessary to keep
India on silver basis. and the natives are blamed
for their stupidity in hiding gold in the ground
instead of putting it in the banks In this way
millions of pounds sterling in gold have been
lost to the world. Americans think they know
more than that, yet they do even worse for they
hoard when the withdrawal of currency from cir
cuaton will do the most HARM Rich and poor
including the bankers and the wealthest men in
the country thought themselves driven TO if in
1907, and they did it.
Mr. Adrich says that the losses sustained
through 1t IN 1907 ran into thousands of millions
OF dollars and can never be measured Other
countries avoid such disasters in various but eff
tectWe ways. In England the failure of the
Barring Brothers would have upset business All
over the world, but the quick aid afforded bv
The Bank of England confined the disastrous
effects to that house and its Immediate asso
cates, with a single and highly significant ex
ceptlon That exception the United States
OF America. for we promptly manufactured
Hurry in the New York money market and
small sized panic on the stock exchange out of
the news. 1t hurt New York more than it did
London, where the failure happened
In France the Bank of France saved the dav
m 1889 when the copper corner collapsed carry.
ing down with 1t the Compton d 'Escompte one
OF the largest Jon-stoek banks in Paris The I'm
perlai Bank Of Germany was able TO check with
out trouble an incipient panic following the fail
nre Of the great Leipziger bank in 1901 Bank
failures IN Canada have never brought wide
spread disaster m recent years because the char
tered banks stood together and redeemed bank
currency and took over and carried the accounts
ct solvent customers; and the losses incurred in
50 dong have never been large
Fhers arc various ways Of accomplishing the
desired result There is little resemblance be-
tween tue Bank OF England and the Bank of
France and the association of chartered banks in
ahada. Congress may BE- able To devise a better
plan than any If these Perhaps the plan rec
commended by the national monetary commission
= ihe best bat the object can be achieved n
"'"'e way Tor others have done it aud have done