Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1915-06-19
Business" and Rev. Edwin r. Well
ford. ID. d.. pastor of the First Pres
byterian Church. Newport News.

cral reserve system are too severe to
permit the small State bank to join the
system with advantage to itself.
Competition among banks" said Mr..
Ingle, land the readiness of their Gus
toners to mortgage the present and
future In their desire TO secure trade,
have resulted in such abuses to
lead many banks to assert that they
i cannot be benefited by the reserve
act for the reason that they hold no
paper eligible for discount under it's
provisions. which. of course. is only
another way of confessing Insolvency
or inability to meet their obligations
upon proper demand, something which
few banks would like TO have their
depOsitors feel.
While II Is only too true that some
banks do not currently hold as great
a volume of quick assets as even
they could wish. 1t is probable that
in most such instances review OF
note wallets in the presence OF an in
telligent understanding of the law and
It's regulations will prove the contrary,
certainly in such degree as to permit
the bank to feel that II is not Obliged
to rely upon the grace of corre-
spondent who in accepting slow or un-
known papers as collateral. usually ex-
acts 4 penalty balance part Of the
price of accommodat alton.
NO HANK DELIBERATELY
PREFERS ONLY FINED LOANS
40 bank deliberately and as a mat
ter of choice prefers 10 hold only fixed
loans even If secure, and banks SO
encum bered are rarely able to do much
! toward the development OF the COM
munities in which they are placed. 1t
| is apt TO be the case that dead II good
assets reflect the accumulation of
| operations through a series of years.
and an afflicted institution should well
| come the advent OF a law which in
| its observance will furnish reason
| to press old claims for payment. and
! at the same time permit the bank. in
the presence OF available funds or
| paper, to seek and help new custo-
mers."
| The country" banker. said Mr.. Ingle.
! appears to be unduly concerned over
the probability that with the perfec-
, ton OF the details of operation OF the
new law Will disappear the o-called
Exchange charge-that cherished. but
/ greatly abused. source OF revenue" on
this point Mr.. lngle said:
! 1t may be well frank.t TO state that
| there will be loss In book accounts OF
exchange as now figured. but this loss
| Will be traceable rather to the effect Of
| the operation OF reserve sections OF the
! Law than 10 the clauses which especial
| ~ provide for clearances.
| Once the law Is in full effect, reserve
/ will consist only Of lawful money in
| vault and balance in a reserve bank.
! The artificial quality heretofore attach
I ing to balances in the hands of APP
! proved reserve agents will. after the
! lapse OF two and q half years, be no
F, longed owned. Balances so maintained
| have been earning their owners . per
cent interest and In addition have cared
! for the clearance of certain related
volume of miscellaneous checks col
| lccted at the expense Of the banks hold
| ing the balances. Naturally the result
! has been profit 10 the interior bank.
| The reserve city bank. however. sim
ply looks at the account from the view :
| point OF profit and loss. 1t is paying
! per cent on average balances and can
! afford TO accept at par just so much
| collection matter from its customer all
/ in the presence of a certain related
! balance. Reserve or not in the figuring
of the interior bank, the moment a bal
ance falls TO an amount where an an
| alysis of the account shows lack of
profit, the depositing bank is told to
! build up its account.
WILL BE DEPRIVED
OF FICTITIOUS QUALITY
Now the new law is to deprive such
| balances of this fictitious quality of re-
serve, when something happens. Obvi-
ously the reserve city bank cannot con-
tinue to clear except in the presence OF
| the old balance. on the other hand.
! the interior bank cannot afford longer
]
/ clearance agent. as such balance being
| no longer reserve will 10 its owner be
| practically dead money earning only .
per cent.
will IL not necessarily follow that
| the interior bank Will withdraw such
balances for loaning at home at per
! cent approaching the fact that per
| cent per annum on its average balance
F.: with reserve agents has really been the
! price paid in the way of exchange for
! the clearance of Its business? Would it
! not Just a certainly follow that the in
| terror bank in owning a balance with
Lifts reserve bank will desire that such
| balance shall earn its cost. and in what
| better way can this be done than in
| using the reserve bank in clearing its
business I par?'
w. y. Hamilton editor of the Wall
Street journal. New York. who adj
dressed the convention at its morning
session on the subject. Wall Street and
the South" took occasion TO clear up
few of the misconceptions which he
said were still current about the ma
TONS money center.
WALL STREET STILL TARGET
FOR POLITICAL DENAGOGUEs
Wall Street" he said. lis still the
target for political attacks by dema-
gogues. who argue on conditions which
were obsolete and forgotten twenty
years ago. 1t has never been sufficient
ly understood anywhere that the honest
men in Wall Street are In the exact pre-
ponderance to the rogues that they are
in other parts OF the country.
You will have noticed in any news
paper that the criminal gets an amount
OF advertising out of all proportion to
that granted to the honest man. Speak
ing as a newspaper editor. can magine
that the student of history 300 years
hence will suppose that the present day
conditions OF affairs in the United
States, as OF the year OF grace 1915.
was made up. for the most part. OF
outrages by gunner in New York.
lynchng Of colored people in the South.
strikes with accompanying violence. the
looting of railroads by dishonest finan-
ciers. and the enactment OF futile and
improperly influenced legislation by the
politicians"
The speaker appealed to the bankers
to free their minds from cant. The
charged of watered stocks" he said, 80