The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1913-01-02
DUE
TO THE BANKERS
SAYS SECRETARY
Secretary Says America
Is World Nation In
Finance.
f UTURE B RIGHT
Treasury Surplus Has Been
a Great Aid to Business
Men in 1912.
f u " r E B FRIGHT

Washington, ID. C. Franklin Mac
Neagh, secretary OF the treasury. i'm
an interview today. praised the bank
ers of the United States for the work
they have done i'm the year just past
/ The American banker. Secretary Mac
| Neagh declares, has made this coun-
try world nation in finance. as we'll
as exhibiting characteristics that help
to make the outlook for continued
domestic prosperity the very bright
| est. With the absence of disturbing
| Legislation Mr.. MacNeagh can see no
cloud to menace great prosperous
epoch for business.
! The secretary dwelt also ON the use
OF the treasury surplus in aiding
business through deposits in the
| banks, a matter of timely interest in
view of the attention that congress
soon Will devote to financial legs-
lation OF Il broader scope than has
been undertaken for several years.
The most notable feature of the
nation S financial experience in 1872
Secretary MacN eagh said. has been
the effective and able manner in
which the American bankers have
! financed the movement of our extra
ordinary crops and the legitimate
business expansion incident to our
growing commercial and industrial
prosperity This financing has been
done in the face OF a European sit
| uation, due TO war and rumors OF
war which practically closed to us
the foreign money marts that we
usually draw on under like condi-
ltions
This Year our money markets not
| only have been without he usual
foreign gold remittances. but they
have had to absorb large amounts OF
| American securities sent back from
! Europe to meet foreign money needs.
| The remarkable handling of this
| financial situation is an evidence OF
the poise, Judgment and initiative of
the American bankers. They not only
financed adequately and without hes
| itation the business OF this country,
| but have accorded masnanlmous
| treatment TO the financial markets
| abroad Every evidence has been Civ
Ell this wear of the world character
of American banking and every
proof that in nothing have We more
become world nation than in our
| banking. | have followed this bit of
current history with great interest
land with ever increasing respect for
our bankers
The treasury department has kept
itself informed OF the banking and
business situation. because ii has
held that amy surplus in the treasury
is kept in trust as ii We're or the
use of legitimate business az 10 be
deposited in whole or in p3.t In the
banks whenever il became desirable
to transfer the surplus from the
vaults OF the treasury 10 the channels
OF business. This surplus. it must be
| understood. however, is not merely d
sum of money. 1t is d reserve fund.
"A reserve for the banking system.
And ii is peculiarly important that
the character of the surplus as d
reserve should be clearly understood,
and that the surplus should be dealt
with on that basis. The views OF the
nature and responsibilities OF its sur.
plus held by the treasury department
| have every reason to believe. have
been generally approved by bank
ers and others.
"A reserve that is. d real reserve
-of course, is something to be useC
and not something to be merely lock
ed up 1t. however, is not something
to be used lightly or prematurely no.
for inadequate reasons. One mus
not evaporate reserve until it il
necessary More or less suggestions
: have nevertheless appeared, iron
one quarter and another. for treas
: ury action that would have result
ed in the squandering OF this reserve
but ! have every reason to believ
: that the leading financial and com
mercial authorities up to this tim
: have refused to see any advantag
Y or anything but disadvantage in gov
II ernment deposits which would diss
y pate the surplus.
"There is a good deal of misundel
standing on the part of those who ar
not close students or observers G
government finance. as to the amour
of the treasury surplus. and as to tn
20 amount of money the government
taking out of the channels of bus
:, ness and putting into its caults. A
y to the surplus, speaking roundly. II
1000, 900 and not $500. 100000
a as more OF less people think it il
This by no means is a large an
cunt of money for the government
carry in excess of its daily needs
N especially in view of the fact that
ST is held, and should be held, as
lg nancial reserve for the country.
y is indeed very small amount con
~ pared with the surplus which tt
h treasury carried for a number
v years up to four years ago. And IL
al modest size of the present surpl,
De has very direct bearing on the que
rs ton of how and when il should
'g used;