University Missourian. [volume] (Columbia, Mo.) 1908-1916, 1913-01-12

forms in the banking system OF TIL
No word has kept step more precise
ly with the times than panic" In
ancient Greece it meant the vague ap-
prehension prompted by mysterious
sights and sounds among the noun
tains and valleys. and attributed to the
god Pan. There We have the origin
OF the word-panikos Two hundred
years ago Shaftesbury used it as
meaning any contagious emotion act
ing under the rules of mob psychology
and seizing upon masses of men.
There are many Parnicks in Man.
kind he wrote, besides merely that
of Fear. And thus in Religion also
Pannick."
Panic fear" was the correct express
sion. and those who first shortened it
to panic" were as slipshod verbally
as the small boy today who speaks
o. his comic" But in its abbreviated
form even the small boy is likely to
know what it means. And the panic,
as it periodically recurs in this coun-
try, is as peculiar to us as is the
youngsters supplement. In the last
fifty years. since the present bank
ing system was established, we have
had five. No other great commercial
country has suffered one i'm that
period.
With us. a panic results in the sus-
pension OF specie payments. Even
among the lesser countries such
phenomenon, with its attendant train
of business failure. public demorali-
zation and national discredit, is a
most uncommon occurrence. So far
as AnglO-SaXOn countries are con-
cerned. the only other one to suffer
a panic in the last half century was
Australia. which suspended specie
payments in 1898.
4 National Disgrace,
1t is not too much to say that our
panics bring national discredit. For
eign bankers whose clients have funds
on deposit in the greatest banks in
the United States are forced to tell
them that their drafts will not be paid
in cash. The cataclysm here is felt
abroad, and we are looked upon as an
international disturber Hartley With
ers. an English economist. says in
THE Meaning of Money"
The internal effects of the re-
cent panic will doubtless soon
be forgotten: but it will be long
before International finance will
look with much confidence on
draft on New York, which has
been shown by experience to be
inconvertible in times OF crisis.
Nor is it too much to say that
panic exercises demoralizing effect
on the public. On this point it will
be enough to quote II. VI. p. Eckhardt.
ar American economist. In his book
on A Rational Banking System" he
says:
Now il must be that even a
single instance of general suspen-
sion of banking payments will
exert profound effect upon the
morals of the debtor classes of the
country in which it occurs. The
off H.
when the instances of suspension
are multiplied 1t can have none
other than a debasing influence
upon the character of the people
If the banks, to which everybody
looks for examples of probity and
faithfulness, repudiate whenever
they find themselves in difficulties,
why should ordinary debtors be
expected to do otherwise? When
circumstances make it difficult
for him to meet his note at bank,
the debtor. you may be sure. has
his creditors numerous lapses in
mind: and if he is not strongly
endowed with good principles, he
is impelled toward devious ways.
Instead of holding his mind firm
ly to the necessity of meeting his
bond in the agreed-upon manner.
he casts about for means of evad-
ing his responsibility
Panics Are Preventable.
These monetary convulsions, so