The Morning Tulsa daily world. [volume] (Tulsa, Okla.) 1919-1927, 1922-05-14
BANK HEAD LAUDS
RESERVE SYSTEM
Thomas b. McAdams,
Association President,
Praises Its Past
HAS SAVED AMERICA
Panics Have Been Avcrted by
Federal Plan i'm Several
Instances, He Says

EXCELSIOR SPRINGS. Mo Tho
tnto1 fi1'Dt was saved from panic
by the federal reserve system not
only once. nuJ a,t.u times since
the ouiNrove OF 'ho rts Thomas
49, M.Ad4mt, presidoui OF Tho Amer
Iutu Bankers association. declared
hero today. speaking lu uu address
before iu. convention uf inu Nils
suuri Stn!o HuD,Jf association.
MrNdnms ohurE,I a part oi present
criticism aimed at the federal rc-
serve sgst.m Goo 'd,m1rDru'7 who
nru attempting tp popularH1 thcm-
selves with those who suffered ii-
uauuial LOSSES duIug the period ~
busuos- reaction lnfs'v uu account
uf their own lack of business fore
sight"
"Wu would have had panic at
the uukug ut tine Lusildulu but for
the federal reserve -ysicm,' asserted
MrAluma We would have hnd
pnuic when President wilson told
congress that the time had come for
us to cntrr tho war had II not been
for 'hc system. We would have had
"a panic lu 1890 whom the great huFi-
moss reaction set iu ~ % result ~
uy'r-cNpauslou ana credit Initiation
that had been created despite the
federal reserve board.
we did not take the warning
when they gave lt The merchant
filled up his shelves and continued
his policy of reckless buying at high
prices, and tho result was that In
1920 ho had dumped ON him three
times The volume of goods hc could
normally usc ana found himself In
the fall with his shelves loaded 10
the breaking point and confronted
with CollapsinE prices ana domoral-
izcd markets.
"Thc consequent losses that many
suffered were despite. ana not be-
cause of, the federal reserve sys-
tenn. and they would have been
greater had II not been for the sys-
tenn. We could with equal rropriety
blame The doctor for hurting ~ In
Hmputatlng a leg which had been
mangled as result Of our failure 10
read the signs and of our persistence
In travelling around n dangerous
curve at 60 miles an hour. The doc
tor was not TO blame for tho accl-
dent, We must assume RESPONSE
hllity for that ourselves and thank
the doctor for eaving our life.
There have been many cNag-
gerated statements as to the ox-
penscs, and misrepresentation as to
the policies Of the federal reserve
system. II is also an unfortunate
fact that during the reaction many
bankers themselves. when they
found IL necessary to deny credit to
some customers In the interest of
the safety OF their own banks.
avoided getting themselves In wrong
with their customers by suggesting
that tho federal reserve bank would
An nj
similar statements have dono infinite
harm. creating IN the minds OF the
general business public the belief
that the federal reserve system was
exercising autocrntiC control over
individual affairs and forcing many
10 liquidate their unsound positions
at loss. As n matter OF fact, no
federal reserve bank In the country,
and no officer of any federal reserve
bank or any part of the system.
has any authority to direct what
loans n banker shall or shall not
make to his customers any more
than the banker himself dictates to
q merchant what people he shall or
shall not sell goods TO.
Unless bankers give careful con-
slderntion to the present situation
confronting the federal reserve sys-
tom There rs grave danger that we
VIII again have our financial system
so onmeshcd IN sclf-sorving politics
that we will Eo through the same
experiences as I'm 1911 and 1885,
when the first and second banks OF
tho United states were lcgislated
out OF existence through the igno
rance of the people OF tho UnlteC
States as To the real facts.
Weighing good against had In tn,
federal reserve system, which after
all Is only u pieco of human ma,
chinery. we find that It's services n
maintaining the stability and integ,
rity OF the nations financial system
were far greater than any mlstake
that wefc made. Criticize tho syS
TEN II you will, but let II be In tn,
nature of constructive suggestion
so that It will function with Tn,
maximum OF benefit to America,
business In maintaining the nation'
prosperity"
McAdams emphasized the duty o
the state bankers associations o
the country and Of the American
Bankers association TO rally TO Tn
support of tho federal reserve eys
TEN. The American Bankers asso
citation, he pointed out, represent
about $4,000 banks OF all Classe
scattered throughout the Countr
and contains within its organization
somo OF the most powerful I'm
flucnces for good in the country to
day, because. he said, the average
banker Is sane, constructive an,
ready to render service for the bene
lt of the nation at large, since pub
lie welfare and prosperity are tn
real basis OF the prosperity of TIA
banks individually.