Il
THE CHICAGO BANKER
September !2, 1908}
The Girard National Bank
Of Philadelphia
Capital,	$ 2,000,000.00
Surplus and Profits,	3,650,000.00
Deposits, ....	28,500,000.00
President
JOSEPH WAYNE, Jr. Cashier
CHARLES M.ASHTON Asst. Cashier
FRANCIS B. REEVES, RICHARD L. AUSTIN Vice-President THEO. E. WIEDERSHEIM
Second Vice-President
Accounts of Merchants, Individuals, Banks, and Bankers Received on Favorable Terms
FOURTH STREET NATIONAL BANK
OF PHILADELPHIA, PA.
Capital ...	$3,000,000.00
Surplus and Profits 5,900,000.00 ־
UNEXCELLED COLLECTION FACILITIES CORRESPONDENCE INVITED
R. H. RUSHTON, President	E. F. SHANBACKER, 1st Vice-President
B. M. FAIRES, 2nd Vice-President
R. J. CLARK, Cashier	W. A. BULKLEY, Assistant Cashier
FRANK G. ROGERS, Manager Foreign Exchange Department
cial institutions was (at that time) represented abroad. It was a constant source of astonishment to me that the American merchant and the American manufacturer had not that financial backing abroad which was vouchsafed to the business men of other lands by their own banks. Not that there was any scarcity in the United States of private firms and banks engaged in international banking. But I found that almost without exception these firms and even the banks either were of foreign origin, possessed a foreign partnership, or else represented on this side some foreign bank or banking house. At the same time it was strongly impressed upon me that by far the larger portion of all strictly commercial international transactions on this side pertained to exports and not imports. And so the conviction came, and I think is entirely correct, that the reason for the existence in our land of these great foreign banks and foreign private houses was primarily because of the staple export trade which we were furnishing to those countries. But it is not difficult to recognize the great difference between our exporting staples in bulk such as wheat, cotton, etc., say to a comparatively few points across the water, as compared with that real export business which contemplates the scattering of a nation’s manufactured articles all over the trading world, with the exception of occasional and fitful “dumping periods.” American merchants and manufacturers are really exporting comparatively little of this latter class of goods abroad. How much better and more profitable for us if retaining our raw materials and making them up into manufactured goods we could “trade” the same off for something we really needed here, and which we are probably now buying for cash or its equivalent abroad. Think of selling our cotton to China via London and Manchester and Liverpool. That is exactly what is taking place to-day under our narrow trading laws. And are we getting the “cash” for that cotton after all? Not much. London sees that we need tea for one thing; so China is told to send us tea, thus creating a credit here which helps to cancel London’s cotton debit. And there London reclines, calmly jingling the cash commission so easily earned both on China’s tea and America’s cotton. “What fools we mortals be!” We think only of gold. London cares nothing for gold excepting as a “reseive for use” in time of stress, or as a big (Continued on page 28)
but as always happens in a closely allied family, the laws of human nature have produced initiations of our action among the rest of the family. This general movement “to seize and to hold,” amounting in recent years to a great wave of greed on the part of every nation, has had the effect of straining the world’s credit and confidence almost to the breaking point. When every member of the family has a feeling that the other “is going his full gait,” at once there commences to spring up a doubt in the mind of each as to the other’s ability to keep it up. Then it is that we see the beginning of that general withdrawal of confidence from each, which is bound sooner or later to precipitate a world’s crisis. The upbuilding of an artificial wealth in this country by an excessive high tariff, for a time did seem attractive; but the bringing to light of actual facts has now disillusioned thousands of conservative and patriotic citizens among whom can be numbered many old time protectionists. My opinion is that high protection, if persisted in, will finally kill all our remaining international trade facilities. Gradually but surely, if our present artificial system is continued, we will be driven within our own walls by the other members of the family of nations. Comparatively few in this country outside of those who live on the coast realize that the greatest war of history is now on. Not a battle fought with powder and swords as of old, but a war of trade and barter; a peaceful war as compared with the bloody conflicts of bygone days and ages, but none the less decisive;—a struggle which will determine the fate of many peoples. That nation can win, which, possessing by nature a world of resources, has but to adopt the world as its field of distribution. Although an American by birth and long ancestry, I had the opportunity of getting my initial financial education in an English or rather in a Canadian bank. Very often in those days while trying to grasp the meaning of that great world’s business which was being done by the Bank of Montreal and similar institutions of foreign origin, I wondered why no large home organization then existed in the United States which was especially fitted for work pertaining to those transactions daily taking place between merchants of the old world and those of our own country. I thought it strange that while every leading nation of the world had branch banks or banking representatives here, not one of our finan-
chants to trade and barter in the markets of the world. Leave the banker entirely out of this deal, and see how it works with the exporter who is rich and does not have to borrow. Supposing, for the cotton you take abroad, it were permitted to bring back some goods to be sold here at a reasonable profit, wouldn’t your cotton shipment and the money it represents “be earning its way back” so to speak? But our high protective tariff forbids the importation, and so you are compelled to ask that gold be sent back, not only at great cost and loss to you in dollars and cents, but also in ultimate loss of trading opportunity with the people to whom you have been selling your cotton.
Is it to be wondered at that all the nations of the earth are more and more resisting our efforts to take their gold? Is there anything astonishing in the recent world movements to become some day independent of our products? Already we see cotton fields springing up where none were thought possible before. Wheat growing and cattle raising are now going on in countries which up till now we have thought absolutely dependent upon our supplies. Our people should awaken to the danger that threatens. In our immense prosperity, brought about chiefly by our wonderful natural productiveness (some say also by our great ingenuity, but that is fully counterbalanced in my opinion by our extravagance and wastefulness) we have forgotten the rule “Live and let live.” We are continually applying the law of addition in our treatment of the rest of humanity instead of remembering that there must also be division. Not that I advocate any general policy which would create balances of trade against us! Just the reverse: I want to see the balance of trade increase reasonably, but naturally and not artificially in our favor. This I insist cannot result if we continue the policy which our people are following, and apparently with more and more blindness as the years go on. I claim that the crisis which the whole world is now passing through is due largely to our actions here in America during the past three decades. The impression has been gradually gaining ground that we want the earth. And when you consider that we are simply one member of a great and inseparable family, this is a mighty bad thing to allow into the heads of the rest. Not only has this feeling created a general resistance to those of our efforts which tend towards depleting the others of their gold;