The daily telegram. [volume] (Clarksburg, W. Va.) 1901-1926, 1916-10-11
WILSON MONEY
LAW NOT WHAT
WAS PROMISED
Money Trust Still Exists and
Elastic Currency is Far
from Reality.

WASHINGTON, Oct. IA IA
yorlte claim Of the Wilson adminlg-
tration is that the federal reserve
banking system destroyed the money
trust and freed American business
from the domination OF Wall street.
Unfortunately the claim Is not
borne out by the records Of the op-
Grafton OF the federal reserve system.
The control OF credit by allied
banking interests and its abuses wore
the result Of opportunities that were
presented by the national bank act
and, so far as the federal reserve
system is concerned, the opportuni-
ties for these abuses still exist. Pub
licity however has put a decided
crlmp in the money trust.
Money Conferred In New York.
The national bank net provided for
the redepositlng Of bank reserves In
correspondent banks In reserve and
central reserve cities. This caused
an inflow OF money to New Yorl, bn-
cause II was in New York arainst So
curitles dealt IN on the stock OK
change that banks could find employ
ment for their idle funds. Loaned
on call, such funds, In ordinary times
were reasonably liquid.
rs there was no other demand loan
market of consequence, the money
wash conferred in New York and.
utilized in this manner. II was the
result OF the System that had been
developed through nifty years of OK
panding activity and tho abuse OF it
must he attributed to tho great prl-
yate banking houses which are not
affected one way or another by the
federal reserve system.
The manner in which this svstnm
was to be smashed was by the with
drawal Of funds from the New York
national banks and placing them in
the federal reserve banks. For tbis|
transition three years We're allotted,
ending November 10. 1917. on which
date all the reserves OF ain the ma
tlonA banks will be either in theirI
own vaults or In the vaults Of the
ieueral reserve banks.
Loan Funds Not LeSsenca.
At this time the withdrawal OF re-
serve funds for deposit in the federal
reserve banks aggregate $500. O00.-
900. III the plan had been effective
the amount available for stock ex-I
change loans in New York would he
loss by about this amount. Despite
the payments Of reserve funds into
the reserve banks the amount Of de-
postis which New York banks carry
Tor other banks Is greater now than
ever before.
II the money trust was to be
/ smashed by the withdrawal of rede-
posted reserves from the New York
banks the smashing process has been
n complete failure.
If the money trust existed because
of the concentration of the funds of
BUSINESS, industry and agriculture in
New York, the money trust has
available and at its command today
more funds than 1t ever had before
in the history of banking In the
United States.
First purnoso cb,rro5
The federal rnsorvo act .s =, Nc,
concei4ed by its authors l. r,iioaii,.
different from Tho rodo,.a, r.ro ''u.e','ts
as a practical bonl,ing sveton, rLo
purpose WINS IN est,,blisb , r,,,,,,,o,. ~
regarvo hanl.s 80, & -uH'n VI
which would have dali. ,r a,I,outions
I with ronhor NIX ~ I ~. o.,
ance in the nSnct,l ', ,,a ~ az nm nv
reserve ban1,s in ra,I; t,'' ~ Ne' g., ne
fnair stabiIizinr irGwanG, 80 oo ,ar as
"a. are nn,arronc,. instit,,,ia Sote.ln
ING limo ogarst Sbn .'' aJ,,o,,t lI"rM-
nccral manic n, n,,,o,.,, $500. y. "il ~
Far cnrrency s'liv' ueh'ahua
II was assumed MAJ t,,a h..,..
the connir,. ,yonIG -, ~, ~, ,me uuilNs OF
II reSisconr,;U Um'u -. ~ 7 ia'Ee amount
-arro 1Lt' nr,.i MN me FEDERAL re-
/, cons4 ,n@a an amu Ls'at mere would be
rom .rnr, NV ~ ~, " cuIrehcy outward
L,-iroSa 80. ~ hleet the demands oil
rnrcv iny,o-j - , bnn,'' ~. .,om ~ cur
tho nbh md Gow ~ ~ oem,ption.
marking with exactnoss Ho tho currency r,ai,ss