Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1922-01-31
MOLLY AND THE BIG A N

ar. Benjamin NJ. Anderson, economist OF the
Chase National bank of New York, told an audience
a few days ago about going through the portfolio
Of the Chase bank and coming across a note for
Sl04.00 signed by a farmer and his wife, residing in
North Carolina and secured by a chattel mortgage
ON Molly, Molly being a mule 16 hands high, five
years old, and broken to single or double harness.
The Chase National bank has resources of 500
million dollars, 1t does not ordinarily loan sums
OF $104.0o on mule collateral. 1t handles it's fnanc-
es in large Jumps. 1t is more apt to deal in millions
than in hundreds, and some interesting facts are
found i'll connection with the presence in its collat-
eral flies OF a note for $1O4. 90, secured BY a mort
gage on a mule.
The Chase bank had loaned 100000 to a bank
in North Carolina. The North Carolina bank had
sent, as collateral for the loan, a stack of paper de-
scribed as being about two feet high, made up Of
the small notes of its customers. DR.. Anderson
the largest note was for $4,000, the next for $500,
and practically all the rest were under $500. The
names attached to those notes represented families
which had been resident in the United States for
many generations,-staid sober, thrifty, prosperous
people. These people had needed money and had
gone to their local bank to borrow it. The local
bank would not have had sufficient money of its
own to supply the needs OF its customers. 1t. how
ever. being an institution, not especially large, but
we'll managed and sound, had connections with the
great New York institution whereby it was able to
borrow, had met the needs of it's own customers,
combined their notes, and forwarded them to New
York, receiving $1,000 in one lump in exchange.
That is merely an illustration of the manner in
which the banking business Of the country is inter
related. We are accustomed to regard the great
central banks. as reservoirs from which railroads,
steel trusts, and other enormous institutions NAV
obtain funds at will. That conception has been
widely prevalent, and it is doubtless present in some
vague form in the minds of many who really under
stand the situation in an entirely different light.
The fact is that while the great bank is a reservoir,
1t is a reservoir which draws its supplies from a
thousand sources, many of them mere rivulets
which carry the savings of a multitude of little in
~vestors, and out of which reservoir, other small
business men, farmers, and others having small
needs are able to draw, through the medium of the
small local banks, whose managers, living among
them, know what their conditions and needs are,
and are able to meet those needs.
The single case mentioned is one of thousands.
The needs OF persons who have no direct relations
with any great financial institution are met because
Of the fact that those institutions have been able to
distribute their activities throughout the country,
using as a means for doing so, local agencies whose
services to their own communities are Of the very
highest importance. The case of Molly and the
big bank, not to consider the loan, but as a type of
the manner. in which much of Our business is con-
Quoted, means a great deal.