Evening star. [volume] (Washington, D.C.) 1854-1972, 1933-11-26
BY CHARLES F. SPEARE.
Special Dispatch to The Star.

small. Nearly all of them have been
adding to their cash reserves.
The latest figure of life insurance in
force in the United States approx
mates Sl08,000,00 900. The number of
policies is 65,000000. Many persons
have more than one policy in the same
company and additional policies in
other companies. So, while there are
65,O00,0C0 policies outstanding. the list
of individuals carrying life insurance
may not be over 100000. Whatever
an accurate count would show, 1t is the
largest single army of creditors that
might be marshaled in behalf of cur
rency stability, comparing with 40,000,-
600 depositors in the commercial banks
of the country.
Easy to Misinterpret.
1t is always delicate matter to dis
cuSs any question that might be misin-
erpreed by life insurance policy holder
or bank depositor. Both are sensitive.
for capital Is always overconscious. The
two groups are, in varying degrees,
capitalists The time has come, how
ever. when silence by the heads of the
life insurance companies and by the
members of the banking fraternity is
dangerous, for they are facing a crisis
in their affairs greater than the present
generation has so far experienced.
1t is true that to discuss with their
policy holders that possible effect of in
fation on the assets and the paying
ability Of their companies might be dis
turbing and check the amount Of new
life insurance business written. There is,
however, a responsibility on the part
of the life insurance heads to these
holders of 65;0000O0 policies and the
Sl08 600 100000 of insurance behind
them greater than that of adding to
new insurance. 1t is a well established
fact that, where imitation of the sort
toward which this country now seems to
be headed has prevailed, the benefi-
Charles of policies have received only
small percentage of that claim to which
they were entitled Prof. Warren, in
his book on prices" has a chapter
entitled investments when the dollar
is unstable" In this he says, 'life in
surance is safer than most investments, :"
and adds the money is likely to be
lost by the beneficiary unless it Is paid
in an annuity FORM Only a COM
paratively small percentage Of policies
are of the annuity type.
The effects of imitation on a majority
of the public are we'll known. Facts
concerning them are readily available.
1t seems to this writer that it is the i'm
mediate duty of the life insurance
presidents to acquaint their policy hold
ers with the processes of initiation and
develop a sentiment that will help to
resist the momentum daily growing for
imitation of an extreme character. No
financial group can command such
powerful ally for sound money as they.
From no standpoint can they Justify a
laissez faire policy in this threatening
hour.
Hold Stronger Position.
The life insurance presidents are in a
stronger position than the bankers to
start a backfire against the imitation
forces. as they have had no direct as
ISOLATION with Wall Street. This. how
ever, does not relieve the bankers of
their responsibility to the sound money
cause or from standing up and being
counted. No ringing voice has come
from their camp such as that with
which the elder Morgan proclaimed his
support Of the Cleveland administration
when the currency was last threatened.
It is truthfully said that if imitation
comes and the bankers are not on rec
ord as openly opposing II, they will be
held in ridicule and contempt by future
generations.
There are many evidences today of a
stirring in banking circles and an
awakening to the dangers that lie ahead
If imitation is not checked. The sound
money advocates have at last an un-
biased and influential champion in DR..
Sprague, whose sensational letter to
President Roosevelt has given them a
pattern for arguments long withheld.
Many conferences have been held in the
last "a hours by bankers and business
men for the purpose of arousing public
opinion against imitation
In the meantime the steady decline
in Government bonds and in all types
of high-grade securities, which preceded
the statement of DR.. Sprague that
bonds, including Government bonds, are
an unsatisfactory investment at time
when a Government is determined to
depreciate it's currency" has touched
the pocket nerve of the Indifferent citi-
zen. He, too, is becoming vocal and
developing a fighting mood. Unfortu-
nately. the delay in promoting a sound
money campaign has given the inf1a-
tionists long lead that may be diff
cult to overcome.
(Copyright, 1889