Henderson daily dispatch., 1942-04-03
Daily Dispatch Bureau.
In the Sir Walter Hotel.
BY BOB

III tIit Dtllh uldil ever Dtlplc III IL
history. State Treasurer Charles NJ
Johnson'S books show total deposit,
Of $55,867, O3l.78 in 1876 North Caro-.
lima banks.
The truth of the matter is thai
Johnson has more money To deposit
than the banks want to take. In the
first place they have to secure every
dollar of it with either United States
or North Carolina bonds. which is
not always convenient In the second
they just don't need that much cash
right now. But all of them are tax
ing whatever Johnson asks them to
take.
Well" said one banker to whom
Johnson telephoned about taking
some more State deposits, have we
got to take it?'
you darn right id the treasur-
er. You remember back yonder
when you wanted it, don't you? Well,
| want some place 10 pat it now.
Go on aad get those bonds for Sc
curity."
lllt IIdSol4 III lIlt tOldlt \ ull-
precedented supply of cash is two
fold. Last months collection Of in
come tax was by far the highest in
history. The other reason is that
the States highway funds are being
spent most carefully now. The in
come is rapidly dWinding and the
highway money on hand, about S24,-
600, 900, has got to be stretched over
many a mile and month.
The relationship between the State
treasurer's office and the banks of
North Carolina is as good if not bet
ter than in any state in the union.
One reason is that each has been
able 10 help the other without jeo-
p2rdizing either public or private
funds. Years ago it was the States
custom to deposit State funds in
only four or five of the larger banks
in the state which were designated
as state repositories. They did not
add to the safety of the States funds,
or has not added to it since the law
requiring the deposit Of federal or
kDtdlt bOlluS dts Stlll! IVY NdS DtSStQ.
But it did make the State ~treasur-
er's bookkeeping a lot simpler. But
now any bank in good condition can
become a designated depository, In
some instances the designation is
helpful. Many a small town bank
and several Negro banks have asked
for State deposits, put up their Sc
curity and got the money.
They have just as much right to
whatever they can handle as the
p:g banks have,' said Johnson.
There have been two instances OF
perfect team work between the
State treasury and the banks Of
North Carolina. The first resulted
from bad times, the second from
good. After the State budget had got
all out of balance during the depres-
sion, the State was forced to borrow
100000 900 on SIX percent notes
which is five times what it has to pay
for money today. Eight of the twelve
million notes we're held in New York,
the rest in North Carolina banks.
When things got a HtI.e better the
treasurer callsd in the North Caro-
lima bankers and asked a favor. If
they would agree tc renew and cut
the interest rate from six to five
percent, he thought he might be able
TO pull the same thing in New York.
Without exception the North Caro-
lima bankers agreed. Johnson went
70 New York and using the North
Carolina bankers confidence as his
No. l argument to put owe the
same thing in New York.
The States financial condition
continued to improve. Not long after
the first cut, the treasurer called
the States Tar Heel creditors back
into conference, They began TO buy
up these North Carolina notes. When
ne went back to New York to put
over another reduction Of interest,
the picture was different.
You fellows were a great service
to US when we needed it, said
Johnson to the New Workers, land if
you want to keep these notes We'll
Dc glad to let you have them. But
you've got to cut the interest rate
10 four percent"
What do you mean we've got to-"
asked one.
"If you don't We'll pay them off"
"Where will you get the money!
Il don't know as how that con-
Germs you, but l don't mind telling
you that the North Carolina banks,
which now have more Of these notes
than you do, are ready to take them
all and at four percent said John
son.
So the New Workers agreed.
The final act came when the
State was back in good shape. Time
came TO sell an issue of bonds the
legislature had authorized. The var
Gus New York and other big league
banks and syndiCates entered their