Evening star., 1933-06-27
Skilled Leadership Demanded
By Class-Steagall Bank Law

Much of the comment on the passage
Of the Glass -Steagall banking law i!
based on special interest in the effect.
of the deposit insurance. 1t is gen.
orally assumed that this will increase
the Importance of the Federal Reserv,
system, and, with the greater centrali-
zation, will create a demand for tht
most skillful examination of all banks
The selection of the officials to under.
take this work, it is felt, offers a grea
task for the Government, since in thi.
direction will be found the test of tht
proposed changes.
Reviewing the history of such legis.
lation, the San Jose Mercury Herald
states that "the way is now paved fol
the restoration of centralized banking
established under the wise administra.
ton Of Washington The Minneapoli.
Tribune, while suggesting that "unifi.
cation, OF and in itself, may not prove
the solution Of our banking problems, ,
argues that certainly the bankine
holiday revealed the need for a greater
degree OF centraliZation in authority
and responsibility than hitherto hac
existed in our banking system" The
Newark Evening News feels that "most
important of all changes, in the light
OF the last decades banking experience
is the power given the Federal Reserve
Board. with clearly implied mandate
to prevent misuse of the central credit
reservoirs OF the country for speculative
purposes at the cost of business, COM
merce and safety"
1t Is agreed by the Charleston Is. c.
Evening post that "one of the principal
merits OF the law is represented to be
the power given to the Federal Reserve
system to shut of the stream of money
to assist market speculation" although
that paper points out that Sin the wild
gambling in the 1929 stock market the
application OF restraint was prevented. II
The Baltimore Sun holds that what
might be characterized as the Simon
pure Glass provisions of the law will
unquestionably contribute to more or
derly banking in the United States, and
thus to the alienation of one of the
sorest spots In our economic system, u
but voices the warning that 'if the in
Surance pool provision is not to produce
an era of banking even worse than that
through which We hope we are passing,
administration of the highest ability,
courage and integrity is demanded"
ut Is progressive step in strength
ening the Nations banking structure, /"
in the opinion of the Asbury Park Eve
ming Press, which adds that whatever
its weaknesses, they can obviously be
remedied as time points to them" The
Des Moines Tribune offers the judg-
ment: "On the whole, these reforms
are mild and reasonable. We need a
more stable banking system, one that
won't start popping like scattered fire.
crackers when a time of strain comes.
We need to end conditions under which
bankers are daily tempted to forget, be-
cause they have securities that they
want to sell, that they are trustees of
other peoples money and the tradi-
tional givers of unselfish advice to in
vestors. There are grave problems in
volved in deposit insurance. Wherever
tried by separate States it has failed alb
jectly. But something can be said in
this particular period for bolstering con-
fdence to the nth degree
'One point which may have consider
able bearing on public opinion" says
the Buffalo Evening News, will be the
possible effect on small accounts. Many
banks make service charges on these
now. Will the need for guaranty put
them on SO improbable basis that
commercial banks no longer will carry
them? That would be a misfortune,
for the aggregate of small accounts
makes a big contribution to the $40,-
000, 900 900 of deposits which carry the
credit of Americans to the high levels
of prosperity when all this capital Is
working healthfully"
Eventually" thinks the Spokane
Spokesman-R Review, insurance of de-
posits will bring unified national
banking system, If approved in its pres
ent form and not modified later. With
out that requirement there can be no
substantial reform of the banking evils
Of this country. with bali hundred