The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1913-09-18
CARE FOR THE CREDIT sTRUC-
YUNE.

/
Hero is n fragment OF banking phil
osophy that might give good sub
ject for debate to. chapters of the
American Institute OF Banking. 1t ap-
pears in long discussion of tho bank
| ers' attitude toward the Glass Owen
currency bill printed in Banking Re-
FORM" Discussing the question OF re-
serves. this editor believes that In
theory commercial banks should hold
only tho cash needed in their daily
business. Tho rest should DO put in
the reserve reservoirs. leaving tho sub
sidiary banks with rediscountable pa
per, an item rs good as cash. The OBJ
jcctions, no thinks are practical and
traditional For half a century banks
have been Judged by the condition OF
their reserves, mot by their power to
continue accommodation to business
under any and all circumstances"
We are trained to an independent
banking system under which each bank
looks out for itself and Is Needless. in
emergency ut least, of the condition Of
all others AS result OF this indie
pcndencc tho American banker feels
little or no sense OF responsibility for
the integrity OF tho whole credit struc-
ture such as impresses the English
banker. Tho great purpose OF the
American banker is to keep his own
bank sound and profitable. In doing
this he may sacrifice business houses
and other banks. The great purpose
or tho English banker is to keep the
credit structure sound and contribute
his share to preventing stress and
maintain perfect adjustmc
We know not with what authority
the gentleman speaks, but common cx-
perience has been such as to hint 10
tho public that this is tho philosophy
Ivy which many bankers live. They
want their own banks sound and profit
general credit structure is a secondary
consideration. There are men and in
rtitutions big enough in vision to sac
that the general credit structure is
what makes any bank profitable. and
that in country as hugo as ours, with
as many varying demands on banking
facilities as occur during the year. the
strength OF tho money fabric over tho
whole country has very direct inlu-
ence on the individual bank
1t seems to us that this confession
hits at the root of all our trouble and
indicates clearly why bankers aro not
IN all ways tho best qualified men 10
form n board of control over our fnan-
cial affairs.
An elastic currency Is admittedly
what we arc seeking. yet how. We
might ask, can the broad principles
productive of such elasticity be direct
o1
down to preserving the mere mechani-
cal stability of separate institutions.
Already the people are perceiving that
credit is not n machine, but an or
ganism. 1t has life of it's own separate
from it's members. The stability OF
the Individual is of prime concern. hut
even Of more fundamental Importance
Is what the English banker seeks,
namely. ito keep the credit structure
sound" and ito prevent stress and
maintain n perfect adjustment"
If IT is argued that the people take
this traditional view then let us edu-
cate the people to n sensible view OF
banking. Small depositors Will always
wonder whether there is money enough
handy to pay them. but business men
and farmers will find their desideratum
in the continuous ability of an in
stitution to accommodate their needs.
We presume this process OF education
is what Banking Reform" anticipates.
since IT ends by declaring the reserve
plan "a dangerous experiment" that
will probably eventually come"