Barton County democrat. [volume] (Great Bend, Kan.) 1885-1915, 1913-04-18
e.
THE CLEARING HOUSE.
Ry CONGRESSMAN George A. Neeiey,
. Of Hutchinson.

By Congressman George A. Nee""
Of Hutchinson.
A Clearing House was originally a
Mace where the messengers from the
various banks OF the city met to ad-
Just balances Of accounts and receive
end pay differences. It was made ne
7eessarys by the custom among banks
q hoaoring each others checks and
an communities transacting large. vol
umes Of business it was imperative,
that to avoid conveying large
amounts of cash back and forth be-
tween the banks, there should be
some specific place for the exchange
ct checks and striking a balance. At
first they usually met at one OF the
banks, but as the business grew and
the number of banks increased, it be-
came necessary that they secure Sc
parate quarters and they thus be-
came distinct institution.
When the older and larger banks
Of the community had thus become
organized, they began to assume the
right to admit or deny admission to
the newer institutions, thereby ere
ating two classes in the banking COM
munity, the. proprietors or members
and the nOn-members, who, for con-
sidetation might be permitted TO
clear the checks through member,
although, the privilege was optional
and might be terminated by such
m0mber or by the association at any
time without hearing and without
notice, even though such non-member
might be perfectly sound and solvent,
and the withdrawal of such privilege
50 affect its business and the public
confidence as to result in closing its
DOGS.
1t usually requires but 30 or 40 min
u" to perform the act Of clearing,
and desiring business to keep their
force employed, and to relieve banks
Of the additional expense, the asso-
citation began to assume to provide
Uniform rates of interest on deposits,
and uniform rates of exchange; and
: in salt Lake City and Pittsburg they
assumed 20 regulate not only the
rates for collecting out-oftOwn checks
and rates Of interest on deposits, and
rates of exchange, but also the hours
FOR opening and closing of banks, and
even the amounts that should be
charged for check books. In fact, thu
<>directors became figureheads, and
but little was left to them except the
Q execution Of the rules of the Clear
ing House Association.
According to its constitution, the
New York Clearing House Associa
ton was organized for the purpose Of
etfecting daily exchanges between its
members and the payment of balance
resulting from such exchanges; the
promotion of the interests Of the
members; and the maintenance Of
conservative banking through wise
and intelligent cooperation.
u is an unincorporated association
organized in 1858, with a total mem
hership of fifty-two, and has, there
fore, been in existence about six
years. It's average daily clearances
have mounted from $4,000, 900 t.
Ss05, OOO, 900, an increase Of over fif
teen times the amount of its daily
cIearan0es for the first year Of its
existence. During the same time the
population Of the city Of New York
has Mcreased from rocco to 5000, 600
and the assessed valuation Of its
nronartv has asnomnfed tn the sfuuen,
deus sum Of $S.21sJOOO,OOO; but not
withstanding this unparalleled in.
crease in business; population and
wealth, this association has so domi.
hated the situatiOn as to force an &C