Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-06-22
Banks Protest Political 0omi-
nation of Federal Re-
serve Board.
NOW ARE THREATENING
TO GIVE UP CHARTERS
Such Action Would Lead to Forma-
ton of Gigantic Money
Trust.

IF the currency bill goes through, with
the pending provision for political domi-
nation of the federal reserve board some
of the largest national banks in New
York will not only abandon their ma
tlonal charter. but will refuse a state
charter and will do a private business
such as is conducted by j. p. Morgan &
Co. and Kuhn. Loeb & Co.
This statement was made over the long
distance telephone yesterday by man
in New York who is affiliated with one
of the banks heading the list of leading
financial institutions in that city
The Significance of such action, it is
said, would be to lay the foundation for
money trust that would be money
trust. indeed. Absolutely unhampered by
federal or state control, such a combina-
tion of financial resources. ability and
credit would present. it is declared, a
powerful influence in the financial world.
Hear the Rumbling.
Indications of dissatisfaction with the
political aspect of the proposed makeup
OF the federal reserve board multiply.
Members of Congress are hearing the
rumbling already, and by the time the
bill comes before the House for actual
consideration a storm of protest will be
whistling about the devoted heads of the
currency tinkers.
congressman are not disposed to criti-
else President Wilson for asserting to
the change in the bill which wrought
this feature. They regard it as case
of must with him. 1t is assumed that
he had to do 1t to prevent the Bryan
element in Congress from jumping the
reservation and taking to the tall timber
as insurgents.
Apparently. it is said, he took a leaf
from Mr. Underwood's policy in dealing
with him on the tariff bill. Mr.. Under
wood. 1t will be recalled, vacated his own
position sugar and wool and accepted
the Presidents views, in order to get
the President behind him for the rest
Of the tariff bill 1t is supposed that the
President yielded to the Bryan sentiment
or this feature to get Mr. Bryan's sup
bort for the general currency scheme.
Untermyer for Bill.
Saumel Cnrermyer, who is popuarly ac-
credited with playing Mr. Bryan's hand
sn the currency game. is said to be in
tine for the bill IL now stands. 1t
was reported yesterday that Mr.. Inter
myer is willing to abandon for the pres
ent his cherished plan for revival of
The money trust investigation and that
he Is trying to pull off Representative
Henry of Texas, who wants the money
trust investigation right away and no
currency legislation until that is con-
cluded.
as the story went yesterday. Mr. I'm
termyer thinks II best to go ahead with
currency legislation. now that the bill
is in the shape which 1t took after the
midnight conference few nights ago,
and let the money trust investigation go
Mr.. Henry. however, will endeavor to
make sure of his investigation by urging
the adoption, as an amendment to the
pending bill. his proposition to amend
the law so as TO give committee of
either house visitorial power over ma
tional banks. With that authorization on
the statute books. Mr. Henry. it is said.
would probably be content for the pres
ent.
Henry Gets Assurances.
1t was said yesterday that Mr. Henry
has assurances from responsible quar-
ters in Congress that his amendment will
be adopted This would il is said prob
ably be regarded by the banks as the
last straw to break the camers back"
To have special committees of the House
vested with authority to open their books.
a privilege now confined by law to the
courts and 10 the controller of the cur
rency. would be = sad blow To them, il
Is declared.
one thing already is evident, which is
Uat the more the national banks protest
agairIs: :ne pending bill the more it will
grow ia favor with certain element in
Congress The mere Iact of its being
Ysgardcd by the national banks as ini-
nloal 70 them the mere will it appeal
10 this class as surely being a worthy
measure and n the interests of the
Vla:n people
Victor :forawetz OF New York, who is
REGARDED by advocates of certain line of
financial thought as the last word on
currency questions. Is ai-eady out In criti-
oiSm cs some features OF tie administra-
ton Bill.
Cites Flaws IN Measure
lie declares that The provision for po-
it,cal domination of the federal reserve
hoard would Introduce in exaggerated
form the worst faults of the Aldrich
Han" That statement IS checking TO
the element In Congress favoring the
clause in the bill. who regard the Aldrich
Plan as having hoofs and horns and
cIoyen feet. and now 20 be told they are
hugging 1t TO their bosom-well. He in
ssts that this clause will completely CEN
tralize the control OF all the reserve banks
In the hands OF government officials sit
tinS In NaSnlilSlOn, ana would result
sectional differences. political dissensions
and probably imitation.
He finds other faults IN the bill. He
insists that no central political board, sit
ting I'm Washington. should he given the
power to require reserve bank to dis
count the paper of other reserve banks
lie says that only the board of directors
of the bank can judge whether the bank
can safely part with any OF its reserves
Protests Discount Plan.
He protests against. the reserve
board fixing the rate of discount hold
ing that. as il is only through its dis
count rate a bank can protect its own
reserves, its own board of directors, he
urges. should tix that rate He says
that the discretionary power of the
central board to lend the credit of the
United States in the form Of treasury
notes to any reserve bank is likely to
lead to imitation of the currency
And SO 1t goes-or. rather so II
ttarts, for the real going has but com
| menced IL is said. and from now or
the brickbats of criticism are expected
10 be flying oveI the admin is ira tion's