Pierre weekly free press. (Pierre, S.D.) 1889-19??, 1913-08-28
STEPHENS BACKS
CURRENCY ELL.

washington. Aug. 25.-In re ,ly to
Criticisms of certain features of the
Glass-Owen currency bill received by
Congressman Dan V. Stephens, from
several of his constituents, he gave out
today the following statement.
The facts developed during the
weeks discussion of the currency bill
In the caucus greatly strengthens my
falth IN the value of the measure to
the country. The big outstanding fact
is that this bill takes the legal re-
serves of the banks out OF the hands Of
the Wall street gamblers, where the
country was unable to get them during
the panic of 1907, and places them in,
~ big federal reserve banks located in
IL regions or districts, where they will
be available for the use of the banks
of each district for rediscount pur-
poses. The present reserve system
broke down in time of stress. proving
its inadequacy.
Certainly the SIS central reserve
banks in New York city, Chicago and
st. Louis. and the 315 reserve banks in
smaller cities, carrying approximately
the bulk of $500, 100000 OF the legal
reserves of the country, will oppose
the measure, because they can loan
several billion dollars on that amount
of reserves to the people at a good
rate of interest. They are not to be
blamed from the viewpoint of personal
interest for opposing a bill that takes
this amount of business away from
them. But it is beyond my UNDER
standing how any one of the 1912
country banks, which make up the
bulk of these reserves, should be OPP
posed to modifying, them into ~ fed
eral reserve banks, where they will be
available for legitimate business
wholly, rather than for most of them
to be used for the benefit of gamblers
in Wall street.
Country Banks Benefit.
"The claim has been made by some
that the loaning power of country
banks is decreased by this bill. This
is not true, as nyone can see when it
is understood that the transfer Of legal
reserves to the federal banks does not
in any way lessen the power of country
banks to borrow or rediscount. They
IA r~ediscount with their federal bank
to the extent of their reserves and be-
yond-tlle only limit being the ability
of the federal reserve bank to keep it's
gold reserve of SO Id per cent. And
if that is exhausted and any other
federal a has an excess the federal
board can order it to r~ediscount for the
federal bank hat is short of reserves.
Not one dollar Of this money car be
loaned to gamblers. 1t is for
and production.
This bill frees for legitimate business
hundreds of millions of money that
stock gamblers have heretofore had tho
use of. 1t will furnish through the ~
federal banks the largest market for
agricultural, Industrial and commercial
paper that has ever existed anywhere.
1t will increase the loaning power Of
every country bank that becomes a
member of h reserve bank. 1t will
enable country banks to get their re-
serves when they need them. 1t leaves
country banks every privilege of profit
they now possess to make money. In
short, it is the best bill ever presented
to congress hat has aver had a show
of becoming a law.
Wall Street Defied.
tWall street would like to stir up a
panic to stop this legislation if it
could, but thanks to the courage and
good sense of Secretary of the Treas
ury McAdoo, they can't do it. This is
the first time in the. history of the
country that a secretary of the treas
ury has defied Wall street. Heretofore
when Wall street gambled up all of our
reserves and got into hot water, the
secretary of the treasury has rushed
to their aid n deposited the peoples
money in their banks so as to enable
them to return the reserves of coun-
try banks.
''But this year, at the first synpt ,m
of a stringency in crop movement lhe
secretary of the treasury tells tho
bankers of the west and south that he
will deposit $50, 900. 900 with them and
$100, 900, 900 if need be for crop moving
purposes. They will not have<to pay
federal reserve banks to five instead Of
~ as provided in the bill.
1t is regarded as probable that the
meeting would result in the selection
of a committee to go to Washington in
the interests of the amendments which