Evening star., 1919-05-04
BY I. A. FLEMING.

Postal savings banks may come and
go. liberty loan bonds and victory
notes have been issued in the billions
ofdollars, but neither have the slight
est effect on deposits in savings
banks
When Congress enacted the postal
savings measure bankers generally
figured that it would be the death
kner of the savings banks, but the
effect was decidedly the reverse-it
brought money out of hiding places.
out of cans chimneys, beds and other
places where those who were afraid
of banks had hidden it, but it did not
lower savings bank deposits. In tlms
some of these hoarders recovered
their confidence and transferred tnelf
funds to savings banks
When the AZ per cent liberty BOND
issues were announced savings BANK
ers shivered-"W pay to to per
cent. but here is the government back
Of this loan at Az; goodbye de-
posits.'' But the deposits kept on
growing. and they still continue to
increase by leaps and bounds.
The general opinion among bankers
now is that the liberty bond issues
stimulated. with their lessons IN
thrift, the saving habit and are d.
rectly responsible for the steadily
mounting deposits in banks.
ne per CcHt IOtCS VI SAo WV
liberty loan have not resulted, so far
as can be ascertained, in the loss OF
savings deposits.
Safety plays almost as much part
in the matter of savings deposits as
interest. coupled with the further fact
that depositors dislike changing their
account from one bank to another.
To do business continuously with
one bank argues for stability. .sug-
gests a fair sized balance and infre-
Quent, if any, overdrawals or presenta-
ton of bad checks
An occasional shifting of bank ac-
counts might suggest the reverse.
That some of the largest savings
deposits pay but 2 per cent. more 3
per cent and few still higher rates
is an evidence of the very fact that
money in the bank. safe against the
day of need, is appreciated by the
workers more than a higher rate OF
interest
Unrestricted checking accounts are
not permitted in banks that pay more
than 2 per cent for savings.
AS an evidence of safety ranking
high. one of our largest savings banks
a9nounced this year that 1t would not
~sy interest on the class of deposits
known as Christmas savings, but the
than s250.000 will have accumulated
in the Christmas savings fund of this
bank before the time for distribution
rolls around.
BUSINESS men generally are taking
of the great abundance of money in
circulation, and when one considers
that billion dollar Congress was
cause for comment a few years ago.
and that much of the $4,000, ,000, 900
distributed during the last two years
found its way into the banks Of the
country. via manufacturers. merchants
and wage workers, it is not so sur
priSing.
Moreover, the wonderful activity,
n in, he nj nh
business. in musical instruments, rec
ords and some other luxuries Is a
direct result of this plenitude of
money also the prevailing easy money
is engaged in raising the victory lib
erty loan Of s4,500.000,O00.
Capitalization Of Capital.
The trend of the day. in the prep
aration for the great part the United
States is to take in world rehabili-
tation, is in the direction Of centrali-
zation Of capital to the building of
great strong units by combination,
and to the forming of great financial
institutions as representative of
TWO or more big banks for the pur-
pose of exploiting export trade.
This latter is permitted by the
Sherman Law. which many of the
most important business men and
lawmakers believe has outlived its
usefulness. handicapping American
enterprise. in contradistinction to the
foreign method of encouraging, con-
Centration.
The latest case of Capitalization of
capital Is announced from Chicago,
where two of the largest trust com
panies both among the Oldest insti-
tutions in the city. have agreed on
inc prellIninaries for a merger.
The Illinois Trust and Sayipre
Bank and the Merchants Loan anS
trust Company are the institutions
that Will merge. with Edmund .D.
Hubert. head of the latter, as presi-
dent, and John j. Mitchell, as chair
man OF the board of directors, The
combined institution will have a can
Ital of S10,Go0.000 and a surplus ~
S20o0o.060, with deposits of close to
S2oO.000.oo0. and the. combined trust
company will be the largest in Chi
cago.
The Merchants Loan and Trust
Company has been known for many
decades as a Marshall Field instifu-
ton. although the great Chicago mer-
chant, IN his day. was patron of both
Mitchell.
Room in Washington.
There is room in Washington for
fnergers-if each consolidation effected
WAS not followed by the organization
OF one or more banks. The field of
savings banks seems the most avail
aoie Tor mergers. although a few ma
tional banks might pool their issues
with good advantage following the
movement prh -ftt