The Birmingham age-herald., 1914-09-29

the depositors in their banks would be assured that their money was properly protected
 There were two bankers in New York. one now living who were among the first to teach the lesson, now so generally accepted, and apparently by the Secre- tary of the Treasury, MT. McAdoo, that reserves in time of trouble should con- stitute a great resource. serving to assist merchants, importers, men of commerce and industry.
 These two were the late Dumont Clarke for many years president of the Ameri- can Exchange National bank. and George F. Baker, now chairman of the board Of the First National bank. MT. Clarke in days of panic. was of helpful influence. The customers of his bank, who in anx- iety called upon him. found that he was cheerful, calm, hopeful, always counsel- ing his friends to maintain their cour- age, not to lose heart. He sometimes would himself broach the question which
 his customers had in mind when they called upon him by saying: Do you want any money? If you do you shall have
 it. His theory was that resources and reserves of his bank could best be util-
 ized by employing them in times of panic. That also was for many years the at
 
 fluence exerted by these two bankers went far toward persuading the bankers of later generation in New York city
 not to hesitate about utilizing their re- serves if by so doing the general situa- tion could be helped.
 What Would Have Happened? If the banks of New York as a whole had boarded their reserves as Secretary MeAdoo says that banks in some parts of the country have done, then 1t would have been impossible to finance the pay
 ment of the existing obligations for New York city and it would have been an end to the project which involves the es- tablishment of the gold pool or fund of Sloo,ooo,00O which is to be used to relieve the business and commercial situation. In the financial district in this city 1t has commonly been said since Secretary McAdoo issued his statement that 1t was Of the highest value, even imperative, that someone of high authority known by the people to be absolutely impartial not under the influence of any group of bank CTS or financiers. should tell the bankers of the United States that this is. not time for hoarding resources and for build ing up accepted reserves. For, while any individual bank may regard 1t as mat ter of pride that it has been able to increase its reserves far above the statu- ioiy nIillI d1u to cuTLa1l loans or, 1T nldk- ing any. to charge high rates of interest for them, nevertheless if this policy were universally adopted 1t would spell ruin for American business and industry.
 That is the important meaning which is contained in the message written by Secretary McAdoo for the bankers of the United States. Many business men are now persuaded that if there were little more courage or a little less timidity American business activity would speedily become very great. But there cannot be a revival of business activity if banks insist upon boarding and dealing out ac- commodatons to their customers in such manner as to call to mind the saying of the Scriptures: He granted the request but sent le9nness to his soul'
 In the long run, excessive hoarding and tenacious building up of reserves are sure to react more or less on the banks which adopt that policy. It is noticed what Secretary MeAdoo is careful to say that in the large financial centers of the United States this policy has not been adopted.