[Volume XXVII
THE CHICAGO BANKER
10
Wisconsin Trust Company
MILWAUKEE
The Wisconsin National Bank
OF MILWAUKEE
CAPITAL -	$2, OOO, 000
SURPLUS -	1,000,000
OFFICERS
L. J. PETIT, President	HERMAN F. WOLF, Cashier
FRED’K KASTEN, Vice-President	L. G. BOURN1QUE, Asst. Cashier
CHAS. E. ARNOLD, 2nd Vice-President	W. L. CHENEY, Asst. Cashier
WALTER KASTEN, Asst. Cashier
DIRECTORS
L. J. Petit	Frederick Kasten	R. W. Houghton	Oliver C. Fuller
Herman W. Falk	Geo. D. Van Dyke	Gustave Pabst	Charles Schriber
Isaac D. Adler	H. M. Thompson	Patrick Cudahy
CAPITAL $500,000 ־ SURPLUS 100,000 ־ ־ ־
OFFICERS
OLIVER C. FULLER, President	GARDNER P.STICKNEY, Vice-President
FRED. C. BEST, Secretary	R. L. SMITH, Assistant Secretary
DIRECTORS
L.J. Petit, Chairman Frederick Kasten R.W. Houghton Oliver C. Fuller Herman W. Falk	Charles Schriber Gustave Pabst Gardner P. Stickney
Isaac D. Adler	H. M. Thompson Patrick Cudahy

able to follow this rule, yet we might, with advantage, adopt another portion of their system which would, I think, secure the object which you have in view—namely, to increase the gold of the joint stock banks. American banks are required, in publishing their returns, to show in separate items the amount held, first, of specie (which is gold) ; and, secondly, of legal tender (which is the note). With this information, the bureau in Washington is enabled to issue quarterly statements which show separately the total of the gold and of the legal tender held by the national banks throughout the United States. If the joint stock banks of the United Kingdom showed their holdings in separate items, first, of gold and silver; secondly, of Bank of England notes; and, thirdly, of Bank of England balances, we should be able to ascertain the total amount of gold and silver held in the banks throughout the country. Can it be doubted that on the publication of these figures public opinion would compel those banks which do not hold an adequate amount of gold to increase their holdings? I think that just as we have seen the banks in London which publish monthly balance-sheets increasing their reserves from io per cent in 1890 to 15 and 16 per cent in 1908, so we should find a gradual increase taking place in the amount of gold held. Daily, weekly, monthly and quarterly averages are advocated by some, but even if any of these systems were adopted the banks would still be exposed to such criticism as you administered to them last week, inasmuch as the public would be no wiser as to the amount of gold held; and I am of opinion that no course can be pursued which will give such satisfaction to the public as that of publishing the individual items comprising the reserve. I also venture to hope that such a course would meet with your approbation.”
Mr. Holden’s suggestion was endorsed the following week by Spencer Phillips, of Lloyds
Bank. In its issue of March 13th, the Statist had an article on bank reserves, dealing more especially with the recommendations of the banking and currency committee of the Associated Chambers of Commerce of the United Kingdom, and there were many points in the article which other bankers besides Mr. Holden were inclined to severely criticise. The Statist, however, is to be congratulated upon having drawn from Mr. Holden not merely a reply to its article, but a practical suggestion which says:
“The American banks in the central reserve cities are required to keep a reserve of 25 per cent of their deposits. When the figures of such banks are carefully dissected and the percentages calculated in the same way as the English banks calculate theirs, it will be found that they are not 25 per cent, but considerably below that figure. This percentage is required in those cities because they hold to a very large extent the reserves of other banks. This is not now the case with the English banks, and therefore it is considered unnecessary to maintain the same high percentage. You admit that the hard-and-fast rule of keeping 25 per cent works badly in times of crisis. While, therefore, it appears inadvis-
arate from the central store in the Bank of England vaults.
Dealing with the first of these points, we cannot help feeling that, however excellent and even practical may be the conclusions reached by any of the committees now sitting, its success must entirely depend upon active and sympathetic cooperation on the part of the outside banks with the Bank of England, and for that reason we confess that we should have been glad to hear that the Bank of England had in some form or other been represented on the committees m question. As already stated, it is greatly to be desired that any strengthening of our. gold reserves should be accomplished without any kind of legislative action; but, on the other hand, the Bank of England is so clearly the pivot of the whole machinery of the money market, that it seems almost impossible that anything but chaos can result if the schemes propounded are not such as will be heartily endorsed and initiated by the Bank of England in conjunction with the joint stock banks. Some of the schemes before the committee for adding to the gold reserves at the Bank of England, and for increasing their effectiveness, are, we believe, of quite an admirable character; but it is equally certain that they must depend for their success upon their acceptability in the opinion of the Threadneedle Street authorities, and we firmly believe that the only committee which will ever carry schemes of this character into operation will be a small body composed of representative members of the joint stock banks with representatives of the Bank of England.
When we come to consider the other aspect of the question—namely, the increase in bankers’ holdings of gold outside the Bank of England— we cannot help thinking that a decided step forward has been taken in the practical proposal which has been made during the past month by E. H. Holden, of the London City and Midland