The midland journal. (Rising Sun, Md.) 1885-1947, 1934-07-20

Ecut circuit ueeuS OF states, cOuntleS,
cities, public schools and other polit-
ical subdivisions, all of which have in
timately to do with the daily affairs of
all Of the people.
Each day hanks throughout the coun-
| try are making hundreds of thousands
of new loans and they are renewing
and extending old loans for the accom-
| mediation Of vast number Of borrow
ers, these borrowers being individuals.
corporations and partnerships and
their loans being incident to agricul-
ture, industry and trade in every COM
munity in the land.
The banks, through their trust de-
partments, are continuing the work
| which they have faithfully carried on
throughout the depression and are pro-
tecting trust funds placed in their care
against the worst shrinkage of values
ever known. Included in this activity Is
the service the banks are performing
| in connection with administering the
| affairs Of widows and orphans.
The banks, through the medium Of
their savings and thrift deposit depart
ments, are furnishing safety for the
accumulations Of many millions OF
people and on this class Of deposits
! reasonable interest Is paid.
Banks are providing service for the
safe-deposit and safe-keeping Of the
possessions, papers and securities Of q
very large number of people.
The officers of banks are unstintedly
and unselfshly giving advice and coun-
sci to the people Of their communities,
| thereby to considerable extent guild
! ing their daily financial and fiscal af-
fairs during this most difficult period
of disturbance.
The Banking Structure Strengthened
The banking structure as 1t is today
has been greatly strengthened and the
process of strengthening still goes on.
Banking is not a closed science. The
banking system which we have had
was not good enough, and l earnestly
believe that an able and non-partisan
commission should be set up to make
a study of our numerous banking laws
to the end that properly correlated
banking system might be worked out
and submitted for consideration to the
next Congress.
A good system would include rigid
requirements as to management, in
telligent and impartial supervision and,
in due time, unification of supervision.
Such a system, composed of banks
adequately capitalized, capably man.
aged and conscientiously supervised,
would eliminate any possibility of
recurrence of what has happened in
the past four years.
The temporary Federal deposit in
surance plan under which deposits In
banks up to $4,000 for each account
are insured has been in effect for six
months and has proven potent factor
in restoring confidence. Only two small
banks out of over fourteen thousand
holding membership in the fund have
failed during this six months period.
The temporary plan has been extended
very wisely for year, and the amount
of the insured deposit has been in
creased to $4,000, thus insuring in full
over $500 in number of the depositors
in the country's banks.
Hoarded money Is returning to the
banks and deposits are showing vast
increase. Banks everywhere are super.
liquid, meaning that they have an I'M
4 usually heavy proportion of their de-
posits in cash. There are two kinds OF
unemployment in this country-unem.
ployment OF men and unemployment Of
dollars. These men and these dollars
must be put to work. Banks in strong
and highly liquid condition are pre-
pared and determined to do their prop
or part in putting money to work.
Requisites for Grants of Bank Credit
That brings me to the all important
question Of the granting of credit by
banks. Two things are necessary to
increase bank credit:
1st. The banks must be liquid and
confident in their own strength.
End, Business men must further lay
their fears and regain confidence to
the point where they will dare to think
and plan ahead.
The first requisite is accomplished.
The second is in process. Bank credits
will increase and money will go to
work as soon as business men get over
their disinclination to borrow and this
will be when they begin to see profits
within their reach.
In past depressions the real move
ment Of the expansion in bank credit
has always come after general business
recovery got under way and not before.
The number of good credit risks Is In,
creasing daily. Not in my time have
good borrowers been 30 warmly well
come at banks as hey are today. New