Tonopah daily bonanza. [volume] (Tonopah, Nev.) 1906-1929, 1912-01-11
BANKERS IN THE LIMLIGHT.


Banking institutions are receiving more at
papers at present State and national banks have
made reports of their standing the first annual
postal bank statement has been published, the
New York state superintendent of banks recon-
mends changes in the law and the house of rep
resentatiyes is trying TO establish the identity of
money trust that is intends to investigate i
and all this in the news of one day The feature
of this news is the change that has taken place
in the relative positions of reserve city banks
and outside banks, and in the banks in the east
and the west, respectively.
According to the report on the condition of
national banks as of December 5 last, reserves
for the whole country have decreased slightly
since September j 1911. The decreases have
been confined almost entirely to the cities,
while the interior banks at other points have
strengthened their position materially. This
marks tendency for local banks to hold and
employ their funds at home instead of deposit
ing it III reserve banks. The deposits in New
York national banks have declined $79, 606997,
while the national banks Of the country in the
aggregate have gained $46,047 ,269
In considering these figures it must be borne
in mind that September ] is in the height OF the
erop-moying season when interior banks have
most need for funds and draw most heavily on
the reserve banks while the return flow OF idle
funds generally set in toward the reserve banks
early in December The reserve banks in large
cities can also money to advantage at that
time i'll providing for payments Of interest and
dividends.
As rule says the New York Commercial, the
reserve banks III New York are loaded up with
idle funds by the interior banks III the dull
seasons when the only outlet for the surplus is
in stock exchange loans. This tends to encourage
speculation at such times. 1t is the direct result
of the lack of elasticity in our currency sys-
Ih, Nv IF CHI avn nd
contract automatically as the demand fuctuates.
This can be accomplished in several ways, one
Of which is the Canadian credit currency sys-
tenn Congress should make up its mind to adopt
one Of the well-tried plans of other countries
on else work out an improved plan of its own.
The ten per cent circulation tax imposed by the
federal government state bank issues renders
any relief from that source impossible even if it
were desirable to revive a system that proved a
failure more than 30 years ago
If the interior banks employ their funds
Il home in fostering local business and indus
tries il will be of great benefit to the whole
country Bankers will watch with great interest
the reports from national banks that will come
uat from time to time in the course of the cur
rent year Should the interior banks try to take
care of their own money the year round the
experiment will convince every of them of
the need of currency reform and Improvement
Of the entire monetary system Of the country
1t IS impossible TO form opinion at present
regarding the future of the postal bank system
with which the federal government has been ex.
perimenting during the past year Deposits OF
Sll.000000 in some 800 banks are relatively
very small compared with the business done by
the regular savings banks in the state for New
York. for instance, where a single bank in this
city carries more than $l00,000000 in small de
post accounts within the limits prescribed by the
state law However, if the government can max,
the postal bank system sef-supporting. and i
should be able to do so, those who wanted it vii
be satisfied. it is to be hoped. The postal bank
have not taken any business away from the regu
lar savings banks aud if they have taught
new element to save they have accomplished
worthy mission that win help the regular hank
in the end
George G. Van Tuyl Jr state superintend
ent OF New York hanks, reports am increase in tn
deposits of state savings banks in the year o
more than six times the total amount on deposi
IA the postal banks throughout the country liz
however, thinks that competition has led som
Of these banks 10 pay higher rate Of interes
than their reserves warrant, and he recommend
every one Of them TO accumulate an adeauat
surplus This can apply 10 only eomparativel
Few OF shem for the sarpluses reported by mos