The Birmingham age-herald., 1916-05-11
TRANSFEROF GOLD USELESS EXPENSE ID ALL CONCERNED Stillman Calls Attention to Condition That Should
 Be Remedied BOOKKEEPING IS
 THE REAL SOLUTION Two Ships Recently Passed Each 9th CT on the Atlantic Ocean Both
 Carrying Large Gold
 Consignments
By HOLLAND

New York, May 10.-(S (Special.)-- years ago the American Bankers asso- citation held it's annual. meeting in New York city and the members of the as- sociation were greatly interested when they were told that James Stillnlan had promised to make a brief address of welcome. They were also curious not only to see, but also to hear, the Amer ican banker who was the first to recog- nize that the day of new things in the banking world had dawned, and who, obedient to the opportunities, had so directed one of the older banks of New York that it had secured within a few years deposits of s100,000,00o That was an extraordinary deposit line for time. MT. Stil1man's address was delivered in about five minutes, and with character istic directness and brevity he concen- trated his thought entirely upon the modern spirit of cooperation.
 In an informal conversation which MT. Stillman is reported to have had with several of the bankers at that time, he was reported as having called attention to the economic waste, so to speak, which was occasioned by the shipment of gold from England or Flu rope to the United States or the ex port of gold from the United States to those countries. His intimation was clear that through co operation there might be and should be provided method whereby it would be unn eces- sary to ship the actual gold. It so hap pened that about the time of this re- ported conversation two steamships passed upon the ocean, one on the way to New York and the other on the way to Liverpool. On each steamship were several millions of gold, and it seemed as though skillful financing might have provided a way by which each of these consignments could be kept at home so that each could offset the other.
 In 1914, England did adopt, in a ten tative manner. method of this kind, but it was done in order to safeguard against dangers due to conditions Of war. The s200.000,000 of gold which were raised in the United States in the early autumn of 1914 for the purpose of liquidating current accounts in Lon don and in providing exchange were sent to Ottawa and not to London. This arrangement proved very satisfactory.
 Paul Warburg and Governor Rains of the federal reserve bank at San Francisco are now persuaded that the time may come when methods can be adopted which will make it unneces- sary to transfer actual gold from one country of the American hemisphere to another. MT. Warburg and Governor Rains presented this idea to the mem bers of sthe international conference which was recently held in South America, and the Secretary of the Treas ury, William G. McAdoo. reported upon his return to the United States last faUOr2. ply received and will be carefully studied.
 Apparently Mir. Warburg and Governor Rains discovered in the admirable manner in which the gold clearance fund which is maintained by the federal reserve bank and administered by the federal reserve board has been handled the first hint which after due reflection justified them iii recommending that if possible there be established gold trust funds in the va rious American nations. Gold trust funds of that kind would be of great convent ence as well as of great economy, since they would make it unnecessary actually to transfer gold in the settlement of bal ances. Governor Rains has had personal experience in the transfer of gold from the Pacific to the Atlantic by means of the telegraph and by bookkeeping oper- ations. San Francisco is sometimes cred ited at New York with so much gold or New York is sometimes credited at San Francisco with so many millions of gold and the whole transaction appears upon the books an exchange.
 This recommendation is one which is cordially approved by leaders in the finan- cial district, and they express the hope that it may be so carefully worked out as to justify the various nations of the American hemisphere in ratifying treaties, for it Is by methods of that kind that the plan can be fully accomplished.
 In 1917, a Pan-American national con ference of the ministers of finance-what- ever may be their official titles-of the various countries on the American heins- phere will hold a conference at Wash ington. These efforts are spoken of here as reflecting in an excellent manner the general policy of industrial and commer- cial preparedness.
 A WOPI n I'D AnE DuENOMENON