Iron County news. [volume] (Hurley, Wis.) 1913-1950, 1923-05-12

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The bank plays such an essential
part in the life Of every community
that every one ought to have clear
conception Of what 1t is, and why 1t
goes hand In hand with human prog
ress. One Of our large city bankers.
whose boyhood had been spent in
small town, was recently telling some
friends about his early ideas CON
corning banks To his youthful mind,
the town bank was merely a larger
model OF the small dime bank he kept
at home. lie believed that the larger
bank was just good, safe strongbox
in which people could deposit their
money. Each day the boy saw people
leave their money IN care Of the
bank, the duty Of which he supposed
to be the protection of the money IN
Ill It was again needed, when the de-
positors could draw 1t out.
Very soon certain things began to
puzzle this small boy. for he knew
that the officers and clerks OF the
bank we're drawing salaries. One day
he asked his father some questions
about the bank The boys first ques-
ton was: Father, II a man takes
a hundred dollars to the bank today,
can he 90 to the bank tomorrow, and
draw It all out again?" Every cent
OF It." said the father Then" said
the lad. 81 want to know how bank
can make any money for Itself. and
pay salaries and other expenses"
The father gave the following an
swer.
when our bank was organized,
the gentleman chosen as presi-
dent. because he was one OF our
leading business men. asked me to
buy some shares OF stock at one hun
dred dollars each. / had hoped for a
long time that a bank would be or
ganlzed in our town. For years, the
men who we're operating the iron
mills had to send to a neighboring
city for money TO pay their employees.
Our merchants had always had difi-
Guilty In taking care OF the money re-
ceiyed IN their business, and there
had been no place to care for the peo-
pies money. ! was glad to buy some
OF the shares In a short time, the
president told me that fifty thousand
dollars had been paid In by different
people OF the town buying shares.
This money made up what is called
the capital stock The capital stock,
in addition to furnishing money with
which to start bank, also serves as
a protection to all those who place
their money on deposit
How Banks Operate
"Tuo bank opened for business and
soon deposits came in from mer-
chants, manufacturing plants, farm
ers. churches. lodges, and other or
ganizations. borough and township
treasurers, wage earners. and women
and children. until at the end OF the
first month about one hundred thou
sand dollars had been deposited The
hank then had fifty thousand dollars
supplied by rs stockholders and one
hundred thousand dollars which be-
longed to its depositors, or a total OF
one hundred and fifty thousand dol
lars. The capital stock and the de-
poslts are referred to as liabilities OF
a bank
Now listen closely" continued the
father. "Whlls II is true that the de-
posltors could 90 70 the bank the
very next day and draw out all they
had previously put In, experience has
shown that this is never done by all
deposItors at the same time. There
fore. the bank does not need to keep
on hand an the money that Is brought
I'm. but only enough to pay those who
may wish to draw out part, or all, OF