The Washington herald., 1913-09-04
CURRENCY fight
IN THE SENATE
CONFINED FROM PAGE ONE.

if the bill as drafted is passed. and
stated that it offers no inducements for
the State banks 10 come in.
Question of Representation.
Mr.. Wade objected principally 10 the
fact that the banks would be compelled
10 subscribe TO the stock of the reserve
banks without having representation on
the Federal board of control In con-
ncctiOn with the system of organizing
regional reserve banks proposed in the
bill, Mr.. Wade claimed that New Eng
land would only be represented by one
regional bank; that the Middle Western
States would be without any regional re-
serve bank if 125 banks out of a total
of l,2jI stayed out of the system. and
that the Pacific Coast would also be
without a regional bank if only forty
nine banks out of a total Of 40 decided
not TO go into the national system of
banks.
Explaining that national banks deal
with the commerce of the country.
while the State banks and trust COM
panies are involved in the building of
railroads. the development of manufac-
lures, and the tilling of the soil, Mr.
Wade said:
Without the assistance of the State
banks and trust companies, your note
issue would be a farce. 1t would be a
rigid note issue unless the larger banks
the State banks-becOme interested
in it,"
He explained that the reserve funds
would find their way into the State in
Stitutions, where the reserve would be
as good as gold.
Senator Shafroth engaged Mr. Wade
in discussion of the desire of the
h.
Reserve Board who are experienced in
banking. Mr.. Wade said that, the en-
tire English banking system was
nearer the ideal than any other; that
the American bankers would be salts
fed to have that system: that any one
can buy stock i'll the Bank of England,
the Bank of France, or the Central
Bank of Germany, and that the Bank
of England has on. its court of direc-
tors Lord Revelstock, who is at the
head of the private banking house of
Barring Brothers, one of the largest in
the world, he said.
Central Bank system.
Il am not going to advocate the CEN
tral bank idea" said the st. Louis
banker. 1T is the system that should
be organized, but 1 realize that it is
politically unwise."
1ou mean politically impossible,
don't you?" asked Senator Weeks, who
earlier in the day made the Democratic
members of the committee squirm in
their seats by getting Sol wexler, the
New Orleans banker, to admit that in
his part of the country there is at
present a financial condition more
stringent than usual at this time of the
year. Mr.. Wexler, who Tuesday took
pains to inform Senator Owen that he
is a good Democrat, told Mr. Weeks
that the present financial stringency
in his part of the country is due to
crop conditions and the impending re-
duction in the duty on sugar.
The entire morning session of the COM
nittee was taken up with Mr.. wexel as
the witness. He was questioned princi-
pally by Senator Reed on present meth
Dds. He characterized the faults OF the
present system as a lack of an elastic
circulation medium and the inability of
-he banks to rediscount commercial paper
N times of need.
Senators Hitchcock and Nelson indicat-
ID by their questions that they.would like
20 see some plan worked out whereby
the government would rediscount com
nercial paper instead of organizing a new
system Of banks for this purpose.