The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1919-02-27

Drank B. Anderson. president Of
the Bank of California, before Anreri-
can Mining Congress, at San Francis
COZ.
Your chairman has given me two
suggestions-0ne the duty of the
banks, and the other the duty of the
clients of the banks. The banks in a
locality are charged with the duty of
seeing that the resources of that To-
cality are financed in some way. Whe-
Their or not it is possible for the banks
to directly engage in that financing Is
another question. We are living In a
comparatively young country-in a
comparatively young section of that
country. We are living under a DEM
ocracy, and sometimes l think Of the
story that was once told me of the
discussions OF. think, the constitu-
tional convention, when there seemed
to be so much doubt as to the nature
of the different classes of government.
One of the delegates from New Eng
land got up and made speech on the
subject of what constituted a monar-
chy, and what constituted a limited
monarchy, and finally what constitut-
ed a democracy. He said that a mon
archy was like great ship that pl0w-
ed across smooth ocean, lights burn
ing, bands playing and the passengers
all happy, and struck rock and went
down; that a democracy was like a
raft: you could not sink it, but your
feet were in the water all the time,
That applies as well to the banking
business of the United States in the
past. WE have in this country about
$4,000 banks. Unfortunately we are
few shy of $4,000 bankers. The prime
duty of the men sitting at the head
Of those banks Is to keep their insti-
tutions in such shape that they can
respond to the demands of the people
whose money they are loaning. Their
prime duty is to keep their investment
in such liquid form that they will be
able to respond to the demands of the
community, the demands Of their de-
positors and so that they will not
bring about a failure on their part
which will he reflected in every walk
of life in that particular community.
The banks of city like San Fran
cisco have a peculiar duty. as the re-
serves of all the country banks are
entrusted to the city banks and their
duty to keep their funds in liquid
shape is a much sterner duty than the
duty Of the country banker, who has
no such obligation to perform.
was brought up in that wicked street
called Wall street i came to Cali
fornia in 1908. In looking over the
banking situation it was perfectly
clear to me that the banks were call
ed upon to do great deal of financ-
ing which was not proper financing
for commercial banks to do. AT the
same time they had to do 1t in order
to perform the duty that your chair
man speaks of, and that Is to bring to
a high point of development the re-
sources of this territory The coast
lacked a number of different pieces OF
financial machinery: the bond brok-
err the note broker, for instance. we
induced those men to come out to the
coast We told them of the opportun-
ity there was on this coast. They
came; and I remember with some
a amusement that some of the bankers
rather resented this foreign money be-
ing brought into this territory for the
nurpose Of competing with their mon
CIV. The answer seemed to me to pe
perfectly obvious, that II their money
came into these fields, and plowed
any of these fields, get my share OF
the worms. You gentlemen know
that these different agencies nave
brought into this community many
hundreds of millions Of dollars, and
Won know that these dollars, working
seeking the reward that they were az
ter, have aided in building up great
many Of the industries OF the coast.
This coast has never had anything IN
the nature of an exploration company
It has always needed something IN
the nature of an exploration COM
pany, company formed by men
whose character was high, whose cap
ital was large, whose capital was sub
scrTbed for the purpose of taking risks
subscribed for the purpose of investi-
eating prospects, bringing them into
being. and bringing them to point
where the banks were justified IN
making loans, and bringing them TO
point where they were justified In OF
fering the securities to the public
There have been small groups on this
coast who have taken those risks as
individuals. There have been large
groups that have come from the older
parts of the country-New England,
for instance There have been large
groups that have come from England
and from France; but the mining in
dustry, beginning at the point of de-
yelopment, is one that has got to be
carried on by venturesome capital. 1t
finally passes that stage and 1t gets
to a point where it is nothing but a
manufacturing proposition, question
- t,ho+har or not Intelligence Is used