Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-06-07
BANKING DECLARED.
= FREED OF POLITICS
Collins Sees Federal Reserve
+ System Placed Beyond
Partisan Pale.


of the currency. declared today in adj
dressing the convention of the New
York State Bankers Association at
the Hotel Mayf1ower.
1--WE have passed the experimental
stage with our systems of banking.
Mr.. Collins said. I'VE have definite
~ affirmed our faith in our existing
institutions. The business and finan-
cial interests of the country now may
move forward with the assurance of
the support of system of banking
practically permanent in its corporate
existence"
Mr.. Collins gave high praise TO the
McFadden act as q StabiliZer OF the
Nations financial system, adding that
the tremendous economic development
during the postwar period made 1t
necessary that the public has some
assurance that the national banking
system be put on a firm and perma-
nent basis.
Charter renewal Feature.
This, he said. Congress had now
done by giving to the Federal Reserve
banks and to the national banks
charters which would continue in
existence indefinitely. Consequently
he pointed out, there will never come
time in the history of the banking
system of the country when Congress
would be faced with the question,
"Shall we renew the charters?"
Mr.. Collins stated that when the
bill was before Congress the branch
banking features overshadowed every
thing else, but now that the act is in
operation, its other important provi-
sions can be seen in their proper per-
spective. He did not go into de
tailed analysis of the act, but said
that the charter renewal features
stand out with great prominence.
Congress has placed the capstone
upon our system of banking" he said.
Pointing out that most of the State
bank members of the Federal Reserve
system hold their charters from State
Legislatures without a term of years,
Mr.. Collins declared that as a conse-
quence practically the entire member
ship of the Federal Reserve system is
protected from collateral attack so far
as the term of their charters is con-
cerned.
above these two groups OF mem
bers is the co-ordinating force of the
great Federal Reserve System" he
added, the existence and perpetuation
of which has now also been placed by
Congress beyond the reach of partisan
politics"
With the charters of the Federal
Reserve banks now perpetuated by
the McFadden act, he declared, it will
take a majority of both houses of
Congress and the approval of the
President to bring the Federal Re-
serve System to an end, and il the
President does not approve of the revo-
cation, he pointed out that it would
require a two-thirds vote of both
houses to revoke the charters.
Foundations Are Firm. i
"That means that so long az our
system of banking has the general
support of public opinion its existence
will not be disturbed by an act of
Congress. 1t is not now within the
power of any organized minority to
force an issue because no such mi
nority can be in a position to take
an affirmative action. We may now,
therefore, rest assured that the foun-
dations of our national banking policy
are as firm and secure as 1t is possible
to make them" 5
Joseph n. Babcock, vice president
of the Equitable Trust Co. of New
York, another speaker at today's ses.
sion, discussed 1.-The Relations of
Trust Service to Modern Banking"
Nathan B. Williams, associate coun-
sci National Association of Manufac-
turers, is scheduled to speak on Table
d'Hote Government"
- gil Jordan, chief economi.+. of the
National Industrial Conference Board
of New York, discussing Prospects
and Problems of Business Prosperity"
discounted fears of business depres-
sion and declared that the real danger,
If there is any, lies in the possibility
that "a real boom period may take
place In the near future, with a rising
price level and all of the ordinary
symptoms of the unusual kind of in
fiation."
Whether such a boom does or does
not take place, Mr.. Jordan said, will
depend upon the extent to which bust
ness men clearly understand the sig
nificance of the changes in our bust
ness life during the past five years and
appreciate the power which lies in
their hands to stabilize our business
progress in the future through intelh-
gent. organized self-control."
Mr.. Jordan described the prevalent
attitude of the business world toward
the future as kind of "barbaric re-
ligion based on ignorance and fear"
and declared that the American busi-
ness man, particularly, is SO obsesSed
with that strange combination of eco
nomic Puritanism and superstition
which il called the business cycle"
that he has lost his ability to believe
in or work for stable economic prog
ress." AS result, he pointed out,
the business world to a large extent
has misinterpreted the true character
istics of the last five-year period.
Calls FOrecasters Hopeful"
. "The business man." he said, ''is
afraid and the business forecaster is
hopeful of a good old-fashioned de-
preston next year. because both of
them imagine that since 1924 we have
been enjoying an oldfashioned boom,
and that in punishment for a little
prosperity we must have great deal
Of depression. In the course Of time
it is likely to become evident that we
have not been enjoying an old-fash-
toned boom. The only real imitation
that has taken place has been an in
fiation of language and to some extent
of the stock market"
"In fact" he added. "the outstand.
ing features of the past five years in
our business life are more character
istic of subnormal general business
than they are of boom or imitation
conditions"
The membership of the New York
State Bankers Association is now
1,2ll, representing a substantial gain
over last year.
At the banquet tonight at o'clock
in the Hotel Mayf1ower Ogden l..
@hlilS, CnueISeCTeIdFN Oh the treasury
and Strickland Gillian of Baltimore
will speak. John McHugh. vice presi-
dent of the association, will preside in
the absence of President Carleton A.
Chase.
At the conclusion of today's bust
ness session, NJ. ii. Cahill, vice presi-
dent of the American Bankers Asso-
citation, presided over IA meeting at
which the New York delegation
elected the following American Bank
ers' Association officers:
Members of executive council for
terms of three years, Carleton A
Chase nf SVrapnSa and Harold X