The Marietta journal and courier. (Marietta, Ga.) 1909-1918, 1913-12-26
WASHINGTON LETTER.
Washington City,
December %, 1913.

Washington City,
December %, 1918.
The Currency bill has passed the
Senate, has been agreed to in the
Conference Committee of the House
and Senate and will be signed by
President Wilson before Christmas
day.
This unprecedented rush of the
Currency bill has been due to the
determination of the Democrats to
press it to an early passage and to
the decision of the Republicans to
not stand in the way of final action.
The Senate has been in session from
10 o'clock each morning until IL at
night, stopping only from to s for
dinner. The Republicans found
themselves to be in a hopeless minor
ity and obstructive tactics were not
attempted.
The bill provides for from eight to
twelve regional banks, which will
deal exclusively with banks and be
the reserve institutions from which
banks will be able to borrow money
as they may need it. The notes to
be issued will be backed by the gov
eminent and against their issue
gold reserve of 40 per cent will be
required. The soundness of the cur
rency cannot be questioned.
The bill has been received VITA
greater favor than was expected on
the part of the banks and there are
indications that it will be generally
accepted by them.
There was a possibility that GER
tain big banks in New York that
are hostile to the Wilson admins
tration would fight the measure
and go out of the national banking
system, but such action is not now
looked for and stocks generally ad-
yanced in price following the passage
of the bill Friday night.
AS banks will have to take stock
In the regional banks and as large
amounts of reserves will have to be
transferred, requiring the shifting of
much cash, it was expected that
money might become tight during
the five or six months necessary to
put the new system in operation.
The reserve banks will have to be
organized, the money will have to
be printed, the Federal Reserve
Board will have to be appointed and
directors will have to be elected for
the regional banks. All that will
take time.
To meet that situation and to
make impossible any money tight
ness, whether due to the attitude of
the New York banks or otherwise.
Senator Hoke Smith introduced an
amendment that will have the eff
feet of releasing for immediate use
il needed five hundred million dol
lars of currency that is already
printed and lying idle in the Treas
ury under the Aldrich- Vreeland act.
The Importance and wisdom of this
was so apparent that it
was adopted unanimously by the
Democratic caucus and passed the
Senate without dissenting vote,
even from the Republicans. With
five hundred millions of currency at
hand a money squeeze is out of the
question and the good effects of the
currency legislation will be imme-
date.
The chief defect of the currency
system of the United States has been
its inelasticity. There has been
iixed amount of money and practical
~ all of it is kept in constant use.
When people get scared in panic
times and hoard their money in
safes, trunks. old stockings and the
ike, refusing to lend it out or let
I circulate. there is no place at
Which other currency can be OBJ
aimed, no matter what security may
e offered.
Just after the panic of 1907 there
as passed a law known as the
Idrich-Vreeland act. 1t provided
lat the banks could organize cur
ncy associations by which they
olId be able to borrow money from
government to relieve a strain
as comes with panic. There
,rinted for this use five hundred
! dollars Of emergency cur