The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1912-05-14


formation will be placed in the hands
of the committee. This will require
great labor long extended in order to
make the information of any avail.
What Is the Purpose.
Although it has been proclaimed both
in the resolutions adopted by the house
of representatives and by members OF
this committee that the sole purpose
of the investigation is the correction of
weaknesses or evils so that there may
be hereafter perfected a just and ade-
Quate national banking and currency
system, yet the impression does pre-
vail that the investigation was really
aimed at New York city and possibI.
Boston, Philadelphia and Chicago, and
furthermore, that the inspiring, al
though not professed, object of the in
vestigation is political.
In this city for several days there
have been representatives of the bank
ers of the United States and of the
trust Institutions. The executive coun-
Gil of the American Bankers associa-
ton, which consists of three delega ties.
from each state of the Union, was in
Thursday of last week. About 10c
memebers of the executive council were
in the city. AS a whole, they represent
the entire United States On Thursday
evening of last week the association of
the trust institutions, which are all
state chartered banks, met at a great
banquet table. From these representa-
tive bankers, state and national, Ii
has been possible to learn something
of the feeling which prevails in other
parts of the country respecting the pro-
posed investigation into the money
trust. Without exception, so far as
could be learned. these bankers said
that the impression prevailed in other
parts of the country when it was first
proposed to investigate 3 the So-called
money trust that the inquiSition would
be conferred upon the three or four
groups of money capital IN
New York city. Gradually, however,
it developed that it was impossible to
CLEAN any information about the man
ner in which these money powers, So
called, of New York were organized or in
what manner they retained their con-
troll over cash and banking credit I'M
less there were thorough investigation
of all the banks of the United States.
For it was speedily learned that
much the greater part of the money
which Network banks lend out upon call
and with which speculative operations
in the stock exchange are carried on
flows to New York from other parts
only a small portion of the money used
in speculation in the stock exchange
is New York city money.
One example will illustrate, fully,
this condition. The president of one
of the larger banks of Nebraska said
to his friends that it was absolutely
necessary that he send to New York
the greater part of his surplus funds
He explained that necessity by saying
that there were very few mortgaged
farms in the county in which his bank
is located. There was no demand for
funds with which to buy farms and !
the lending of money upon bond and |
mortgage of farm properties was prac- |
tically ended in that county. OF course, |
this bank, having a national charter. |
could not lend money upon the secur- |
ity of bond and mortgage. 1t could |
however, deposit surplus funds in state |
banks and these banks lend money /
upon that security.
In Nebraska, this banker said, sur |
plus capital is rapidly accommodating,
and for that reason there is very little |
demand for discount, excepting by |
was essential, therefore, that the sur
plus funds deposited by these banks /
should earn something and for thai /
reason he was compelled to send these /
funds to New York. Much the great
er part of the deposits he made with
New York correspondents were lent /
upon call to brokers and operators il
the stock exchange.
This is one of the details upon which /
the Pujo committee insists. on securing
information. Furthermore, individual
borrowers from the smaller banks |
throughout the country, many of whom
borrow upon their personal paper, have |
learned that these transactions will /
pass under the scrutiny of the Pujo |
committee. 1t is inevitable that they
should thus be- scrutinized by the COM
mittee if there is. to be accurate and
information respecting |
banking and currency conditions. This |
however, is a new development and |
has served somewhat to change the |
attitude of people in other parts of tbs |
respecting the investigation |