The Richmond Virginian. (Richmond, Va.) 1910-1920, 1916-11-28
UNSECURED FOREIGN

CONTINUED from First Page)
define its position clearly. in MAKING
d this statement he board desires 10 dts-
claim any intention Of discussing the
"a. finances or of rejecting upon the
! finan csal stability of any nation, but
wishes il understood that II seeks TO
deal only with general principles
which affect all alike.
= 81 The board does not share the view
frequently expressed of late, that fur
sher inportations ct large amounts OF
gold mus; OF necessity prove a source
danger or disturbance TO this coun-
y try. That danger. the board believes,
y will arise only IN case the inflowing
gold should remain uncontrolled and
90 be permitted to become the basis OF
1 undesirable loan expansions and or
limitation There are means. however.
Of controlling accessions OF gold by
proper and voluntary cooperation of
r44he banks or If need be by legislative
4. enactment
s-~se~Short Term I'm Name Only.
Tn,T~Sc board Believes that at this time
sanks should proceed with much eau
24ton iff1Dcking up their funds in long
3krm obligations or in investments,
fhich arc shortrerm In form or name
hut which. either by contract or
41hroueh force OF circumstances, may
III the aggregate nave ~ w iSHc"t's
mtil normal conditions return, The
bard does not undertake to forecast
roba hilittes or to specify circum-
kances which may. become important
Actors in determining future condt-
Hons Its concern and responsibility
lies primarily with the banking situA'
ton.
XII IF however our banking instltn'
S4stions have to intervene because for
N fa ste
1hey can be absorbed by investors
%T~fhat is their depositors-an element
&xwould ne introduced into the stua-
EHsion which, II not kept under con
fss4rol would tend toward instability
I*Mnd ultimate injury to the economic
EeIevelopments Of this country
s4~p While the loans may be short lr
form and severally, may bc collected
sasAt maturity. the object of the borrow
-er must be 10 attempt to renew then
cole ctiveiy. with the result that tn
Nssggresate amount placed here Will re
ssesnain until sudh time as IT may b
s~sRdvantageousiv converted into long
ze4erm obligation. II would, therefore
TeNeem as a consequence that liqulT
funds Of our banks which should ~
Ava liable for short credit facilities &
~ bur merchants manufacturers ant
FARMER would ia exposed to tn
manager of being absorbed for othel
1ws9surposes to a disnroportionate degree
Mkkpecially in view or the fact tina
s~sSnany OF our banks and trust com
spanies are already carrying 81 bstan
- ial amounts Of foreign obligations
and of acCeptanees which they ar
ander agreement To renew The boar'
deems it, therefore, It's duty to eau
Ms1ipn the member banks that 1t doe
rot regard II in the interest of th'
sSSrountrv at this time that they inves
Ean foreign treasury bin OF this char
Msocter
~ THE hoard does not consider tina
Sssjt is called upon to advise private In
ancestors. but as the United States Il
&*fast becoming the banker of foreign
7ountrles in all parts Of the world. !
Ass4akes occasion Ia suggest that the In
nfestor should receive full and au
authoritative alphabetically in TIT
sssTase of unsecured loans-in orde
AaAAt he may judge the future in
&2eiligently in the light Of present con
XDltions and in conjunction with tn
%sSconomic Developments of the past.
~ '~rhe United States has now attain
I'D Q position OF wealth and OF inter
sspationAi financial power. which. II
Abe natural course of events. II coult
*~not have reached for a generation
I've must be careful no. to impair THU
EDpsition OF strength and independ
Elnce."