Evening star., 1933-10-27

A substantial volume Of conmenda-
ton comes in response to announce
ment Of the Governments plan to have
deposits released from banks that have
been closed Federal financial assist
ance will be given in handling the
assets of such institutions. 1t is be-
1ieved by the majority of observers that
the use Of hundreds Of millions which
have been tied up will give valuable
assistance to the campaign for recovery.
Most financial observers believe" ac-
cording to the Rochester Times Union,
that the move is excellent, since it
will release to thousands of depositorS
funds they need to make purchases or
finance their business activities" The
Columbia IS. CO State sees prospects
of accounts and buying" The Oak
land Tribune remarks that zone more
plank is adjusted to the recovery plat
form" and the St Paul Dispatch de
weakness in the recovery program. The
money tied up in these institutions
throughout the country has represent
ed deflationary influence that has
been distressingly effective in coun-
teracting much of the infationary plan
of the administration"
ut is being put into effect with a
rush." according to the Dayton Daily
News, which adds that "a similar
process is going on with the frozen
mortgages of the country" The Fort
Worth Star-Telegram believes that
there is no forward force greater than
the one created by the restoration of
money and credit supposed to have been
lost"
Execution of this project" in the
opinion of the Philadelphia Evening
Bulletin, should benefit depa2to ors by
giving them use of at least Aabstan-
tial part of their own monee. add to
national purchasing power, relieve the
securities market of the consequences
of hurried liquidation and permit the
ultimate realization of better price
for deprecated assets. In carrying it
out the Government takes a reasonable
risk for the general welfare. Success
of this relief measure hinges largely
on the speed with which the machinery
of appraisal can be made to operate
in the case of national banks and on
energetic cooperation by State au-
thorities in the case of State institu-
tions. The opportunity is opened for
effective service"
"It will be not only a relief to hard
pressed depositors, thinks the Topeka
Daily Capital. but will stimulate the
Buy Now drive. 1t encourages con-
fidence in this section in the Liquidat-
ing Board that C. B. Merriman heads 1t.
Release of a billion dollars or more
of deposits in banks renders a much
greater service than issue of billion
dollars in Treasury notes or other cur
rency, assuming that the released
credits go into banks, as 1t may be pre-
sumed most of them will Money
boarded and kept out of banks is little
more serviceable In aiding business re-
covery than money tied up in closed
banks"
Nearly all the banks that were
closed" recalls the Charlotte Observer,
were shut by reason of too many real
estate mortgage securities. The depres-
sion sent paper of that kind to a low
ebb. Federal bank examiners turned
it down in every case although realiz-
ing that it was good security-for the
future. Previous to the depression real
estate mortgages were regarded as first
class security, and because of this the
banks were well stocked. How to get
rid of this class Of collateral has been
the rub, but now the problem is being
solved In short, the liquidating COM
pany being set up by the Government