Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1913-12-08
Senator Swanson Delivers
Speech on Subject in
Senate Today.
FAVORS BANK REFORM


Washington, D. c.. Dec. S.-Sena-
tor Swanson today delivered a speech
in behalf of the Owen currency bill
pending in the Senate. He said the
measure wa, wise, prudent and con-
selvativc; that it retained all the
good features of our present cur
rcncy and. banking system and only
eimirt.ted acknowledged evils and
supplied confessed additional needs;
that it was advantageous in that 1t
continued our present currency With
out diminishing its volume aggrega-
ting $4,000. 900, 900; that it continued
our present system Of independent
banks, which has been most beneficial
in the development of this country
. lie presented the superiority OF the
American system IF Independent
= banks over systems in other countries
with few large central banks and
many branches. He said that under
the pending bill the $4,000 banks of
This country would continue to do
business as heretofore. He pointed
out ,hc evils of u central bank, cla1m-
ing that the advantages of central
ir.nk were far exceeded by the obJec-
tions 10 such hank. He claimed
that un;;cr the proposed system about
J-;l0 of the banking capital Of the
cau:.iry would Le included in The syS-
: TEN and about LILO Of the banking
,csources Of the nation, thus claiming
that the vast amount of banking
G: ritai resources Unaffected by
,he system would be left for bus'-
nn.2 ard accommodation Us now
| cxistin" He asserted that while the
! capital and resources of the Federal
r., serve banks created under the bill
were small in comparison to the cap
itnl an. resources un<iisturbed by the
| HIM. vet it was ample for tn. pur-
poycS sought to be obtained and
made the Federal reserve banks far
greater in capital and resources than
The Bank Of England, the Bank OF
France o. the Reichhank of Ger
mauy, and thus would be more poten-
tial in correcting panics and money
| ~ ltlnk
Said he: "The system veerS be-
tween helpless weakness and tyrannic
strength. 1t gives the banks OF the
country neither. a master nor a slave
but a strong, vigorous co-worker ana
assistant"
He maintained that one of the
greatest evils existing under our
banking system today was the vast
accumulation of the reserves Of the
banks in New York City, which were
used largely for stock speculation TO
the detriment of business. He dis
,usscd the panic of 1907, claiming
shat it was occasioned by the action
nf ,b. New York banks in suspendlng
u?ymcuts and refusing to pay TO tne
interior banks the money thee on
dcnos;t which WAS necessary for CROP
uurposes, He said the banks OF New
York City suspended payment WITT
s22l 900 900 of reserves, which wert
never reduced below 25,00O, ,oOe
during the crisis. while the Bank o.
England continued payments VIII
reserves of only sl25.0o0,0O0 which
were reduced to sS5,000,00O. ne
then proceeded TO show that whllt
the banks of New York refused II
pav Interior banks the deposits due
them, yet they had increased then
loans Curing this time, and most O.
it was Cor stock specularions. Here,
said he. I've strikingly witness th'
difference in conduct between banl
with a public responsibility and ru,
for public interest and those run en-
,ircly for private interests and prof
it."
lie discussed the Importance to tn
hanks themselves and to the busmeS
interests of the country that the ~
serves Of the banks i'll time OF eme
eency should be held in reserve cel
t,rs as contemplated in the" propose
hiu where public responsibility wou
exist ana assurance would Be q"
1hat they w9uld ba used taf tae ra
ac gond ard not for rN~ste intslss 7, q