The Idaho Republican. [volume] (Blackfoot, Idaho) 1904-1932, 1920-09-29

something that happened ten years
after the other events that l told
you about when he used his fortune
to prevent a panic and to keep bust
ness stabilized. You may wonder
why am saying so much about Mar
shall Field, but to me he is die
tionary of good business principles
and we ca. afford to saturate our
selves in them. We can afford to
study his operations great deal
and take plenty of time to let 1t soak
into us. What l told you about now
he prevented panic during the
worlds fair applies in some measure
to a condition right here in Bingham
county at the present time. Thls
other story that l am going to tell
YOU is a little different but it applies
to a set of circumstances that con-
= front somebody in Bingham county
right now. Thoughtful persons will
see the connection and will draw a
lesson from it and apply it to their
business transactions, to their own
advantage and the advantage OF their
fellow men in the county.
Walsh Bank Failure
About the beginning of the pres
ent century John R. Walsh was the
president of the First National bank
of Chicago. 1t was very strong
hank and Mr.. Walsh was big man
in business. He conceived a plan to
build a connecting line with the
Chicago & Central Illinois railroad to
tap the coal mines of Central Illinois
and taking a direct short cut into
Chicago. 1t was good enterprise,
bold stroke and was capable of re-
leiving some of the other roads OF
their burdens of freight and quick
ening the delivery of coal into
Chicago. Mr.. Walsh thought he
could build the road and he went
about it with his private fortune.
When his own money was used up
he used the banks money, loaning
it to himself and his railroad COM
pany. In doing this he violated the
banking laws more severely than
the Anderson bank at Idaho Falls
violated the banking laws when 1t
loaned upwards of a hundred thu
sand dollars to A. J. Stranger, who
went about buying sheep and writ
ing checks on the Anderson bank
when he had no money to his credit.
1t was against the law for the Ander-
son bank to loan more than $4,000
to any one man. 1t was violation
of the laws for Mr.. Walsh to take
money out of the First National
Bank of Chicago to back his rail-
road enterprise. Before the road was
completed Mr.. walsh and the bank
were in so deep that they were finan-
cially embarrassed and had to give
an accounting and 'fess up. If Mr..
Walsh had succeeded with his enter
prise he would have come thru all
right and he would have been con-
sidered great man.
Big Bank Failure
Mr.. Walsh failed and the bank
failed for many millions. Big fail
ures like this are what start
financial panics. When one tfirm
cannot pay, another firm depending
on them canot pay and many other
firms depending on them fail, and
so the damage goes on down the line
until everybody connected with it
fails. Then all the firms depending
on these firms are embarrassed, they
cannot pay their employees and their
various other obligations, work stops
nav checks do not come any longer,
families go hungry, and there is a.
condition which we call panic.
CONSERVATION Among Bankers
The First National Bank of
Chicago was such a large bank, such
a financial pillar for all the other
banks in the city, that they called
a meeting to see what could be done.
1t was a terrible surprise to find that
this man walsh had goth in so deep
and was involved in criminal charges.
1t was a terrible shock to all the
other bankers to find that what was
supposed to be one of the, best banks
in town was involved in failure and
that involved them and they too,
might fail. All of the enterprises
depending on their own banks might
fail and as they considered the mat
ter there seemed to be no end to the
failures that were likely to follow.
These men sat in conference all day
and all night trying to plan some
way to prevent the failure. This
tremendous amount of debts was no
obligation of theirs and it was a
criminal affair. The men respon-
,sible for it could not pay and 1t
was not their own debt to pay, 80
they spent great deal of time going
over the matter to see how it all
came about. But after they had
been in conference twenty-four hours
they were still confronted with the
fact that the firm had failed and
that unless something was done
,ra%+v cuiok ofhor firms would fail /