Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1916-09-19

so that it must stimulate prosperity in
our section. / see nothing ahead but
continued improvement and development
for Georgia and the surrounding
states"
Commenting upon the extraordinary
lrecord made by the present Democratic
administration Senator Smith said:
THE record Of the administration of
| Woodrow Wilson, and, l am fully JUS
flied in adding, the Democratic con-
gress, during the past three years and
a half is the most brilliant and serV-
iceable that has ever been given in the
same period of time to the American
people.
Il pass by the fact that under the
most difficult and trying circumstances,
10 the people of this country have been
preserved the blessings of peace, and
peace with honor. If President Wilson
aad done nothing else for the people Of
| the United States, he would deserve
their everlasting blessing.
| For the first time we have made
great strides in the direction of national
preparedness. The navy of the united
States in a short time will give TO our
country a voice in the settlement OF the
affairs of the world so essential TO the
preservation of our commerce ano our
worldwide relations. But these thlngs
are so generally known l need not talA
of them in detail. .
"You ask me to select something or
| the constructive work -
at might take the reserve panklns
system. 1t is enough TO estaohsh III
history the work of any ADMINS Ila-
ton. But the public generally haee
heard a great deal of It, ana II heeu Ia
| he discussed in detail 1t has proVloeTu
| IN nFnVRnI -
hos been done by Democratic aoIllln
istration. when with years OF controi =.
he country Republican administrators
| reglected this most important supJ1 ,--
tsIVbat I wish to do is to emphasizes
- foc+ that this Democratic aoIillnlS
ration has silenced forever the INC ons1
thot democrats could oppose the me- 49,
ures of their opponents, put We
liable of constructive leSlsio .o the
r" CIV bove not only furnished TO tne
,o,,,+r,, great constructive leg lsla1loll,
49, we have shown q capacity 70 my" ~
o,-,argencies as they arose. IaAe %
.i4,n.4;or which existed August l. 10
STbe areat nations of Europe pluheeu a. a.
most without warning INTO Iar-e
struggle. American securities ~ porlT
SI,antities began to pour into Ne" NJ ~. n
G;t,, reouiring provision by the panhlIis
e,.ston,s there to handle their uneXpec'-
ed presence upon the market 49,,
"6n August Sd, the bankers or New
vo.Ir civ were In a. state of panic. Ihey
we're preparing not only TO stop loans s
hut TO call in all obligations que men a.
IThis was also true In the olneI 49,
! 6nancial centers We had not had time
~ mt the reserve banking system INTO
| ooarotion If the financial institutions
90 +ha hig centers had called in the Cd
legations due to them, and torceo theH
debtors to settle up, their ueptois -.
turn. the smaller banks throughout Ihe
country, would not only nave peeH coih-
PEELED to make no more loahS; oU. - ~
would also have been compelleo 10 Ie
o,,;ra Of nearly all of their borrowers
| immediate settlements.
"This would have forced liquidation
all down the line. Nearly every man
who owed a dollar would have been
called on for prompt payment. Great
sacrifices of property would nave peeh
necessary. and the country was on the
verge of a most terrific panic. More
causes existed to bring on such panic
than 1 have ever before observed.
eft was in this situation that the
| Democratic congress on the 4th or Aug
ust, 1914, took the old skeleton Of the
! Aldrich- Vreeland act, and changed II IN
to a measure by which the panic was
averted We had cut down the rate of
tax charged under the Aldrich-Vreeland
act. which ran up 10 per cent on the
issue of emergency bank notes, to a tax
of to per cent. On the 4th Of Aug
ust we amended the bill still further
and allowed any national bank to put
up its ordinary commercial paper with
the secretary of the treasury as Sc
curity for the issue of it's bank notes
to be used as circulating medium. Under
/ the old law the bank was limited to a
small class of bonds which few banks
had. We amended the law so as to per-
| NIT banks to issue notes for circulation
| up to 125 per cent of their capital stock
and surplus. Under the old law the
| issue was so surrounded with restric-
lions that but few notes could have
been issued even II the necessary Sc
curity had been held by the banks.
Secretary McAdoo went to New York
on the night Of August 4th, 1914, and
met the bankers of New York, and laid
before them this legislation which we
passed through both houses of congress
on August 4th. He explained to them
the manner in which he would exercise
his discretion, and how literally he
would accept their commercial paper as
security If they in turn would do their
part to broaden credits, to broaden loans
and stop liquidation.
THE authority to issue bank notes
! for circulating purposes was enlarged
to over billion dollars. by the act OF
August 4. In two days after this legis-
lation was passed and understood, a
complete change took place in the great
financial centers. The financial insti-
| tutions availed themselves of this bene-
| ficent legislation, the banks all over tire
country soon began also to avail them
| selves of it, and in short time nearly
five hundred million of bank notes were
put into circulation.