[Volume XXVII
THE CHICAGO BANKER
14
Editorial Comment
will be ready to report at this session. As to inland waterways, there is no likelihood of any radical recommendation. Mr. Taft will insist that no inland waterway improvement shall be undertaken until engineers have approved its feasibility and determined its cost.”
The message will have great interest for the valiant bankers who, so strenuously, have been waging an educational campaign the past year against the postal heresies.
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That Central Bank of Issue
After months of time devoted to a series of articles on the central bank the Wall Street Journal sums ׳up the evidence (its own) and there isn’t one count against the central bank idea. The Journal claims to have, among other favorable things, demonstrated that:
“A central bank, organized under a proper system, would afford elasticity to the circulation.
“It would meet the demands for an increased issue of notes in the crop-moving season, without imposing undue strain upon the New York money market.
“It would prevent those violent fluctuations in the rates for money which now occur, not from real economic causes, but because of the defects of our currency system.
“It would afford support for country banks in case of pressure, by reason of their ability to rediscount their best paper, without any limits except those imposed by sound banking, directly at the central bank or indirectly through large joint-stock banks having relation with the central bank.
“It would put an end to the pressure of the country banks upon the central reserve cities for legal tender money, because it would provide an adequate supply of its own notes to meet demands for currency.
“By thus obviating the pressure for legal tender money, it would prevent hoarding by the banks in times of crisis, under the impression that the supply of currency was limited and might prove inadequate.
“It would result in the concentration of the reserves of legal tender money at central points, where they could be promptly utilized to meet legitimate demands from any quarter.”
This whole series of articles are among the ablest the controversy has produced and present the pro-bank end of it faultlessly. Every student of banking questions should have the complete set.
Elected to Vice-Presidency
William H. Wildey has been elected to the vice-presidency of the First National, Mt. Car-roll, 111., to take the place of James Graham, deceased.
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On Directorate of Two Banks
Charles B. Lamb has been elected a director of the Merchants National, and the Eaton County Savings Bank, of Charlotte, Mich., to succeed the late Edwin N. Ely, of Olivet.
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is ready to begin the active work of drawing up a new plan Chicago bankers and financiers will be called into a conference with it. I had a talk with Mr. Aldrich after his speech, and he told me that as soon as they had the material now in their hands in shape they would be ready to receive suggestions.”
Another widely credited authority gives us this opinion, and adds to the stock of informative "guesses” as to what the senator was here for.
“The senator, confessing to a conversion, expressed his personal opinion that an efficient organization of the credit banking system of the country is much more important than the question of note issue, but he did not absolutely neglect the latter. He indicated in what he said of European experience that he had a sympathy for a central bank of issue. He believes that branch banking as it exists in other countries is not possible here. He expressed himself strongly on the subject of keeping partisan politics out of any system that may be established. Manifestly this was not a keynote speech, but the story of the programme of the commission is interesting. If we are to have, as the senator says, the most complete and comprehensive investigation of the subject of finance that has ever been made and an up-to-date library on that subject we should certainly be able to act intelligently when the time for action arrives.”
Boil it all down and it becomes very apparent that even Senator Aldrich does not see any easy way of putting in a new banking and currency system for the dear people without enlisting their support in advance. No really good system can come in any other way.
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Taft and Postal Banks
From Augusta, Georgia, comes the word that Mr. Taft will take up the work of passing a postal bank bill as soon as he gets settled again in Washington. The sender of the information is the chief accredited press correspondent with Mr. Taft in his 14,000-mile trip. All of the important policies of Mr. Taft and a few of Mr. Roosevelt are to be re-asserted in the forthcoming message to the December congress. On the postal bank subject and the waterway projects the inspired correspondent says :
“The president will urge the establishment of postal savings banks. There will be no definite recommendation for monetary legislation, as it is uncertain whether Senator Aldrich’s commission
Mr. Aldrich to the People
It is said to have been Mr. Taft who advised Senator Aldrich to go before the people first if he had serious desire to live in history as the author of any great piece of constructive legislation. Ex-Minister Crane’s friends ascribe his discomforture to similar advice from the president and yet, the manner of carrying out instructions has much to do with success or failure. Mr. Crane gabbled ceaselessly in a sensational vein. Mr. Aldrich spoke tersely, dryly, and only in high company. He dwelt in platitudes, the safety of both statesmen and near-statesmen. The public received only a message the substance of which has been going to it for months through the advance notices of the propaganda, including orators, bankers, newspaper writers and others. “The definite” plan was not revealed nor is it likely to be at the coming session of congress. The commission is at least entitled to spend as much time and money in learning the wishes of the American people as have been spent in foreign studies and investigations. In fact the commission will fall far short of its duty if the home end of the question is neglected or hurried over.
One Chicago newspaper of national influence sums up the situation, in reviewing the Aldrich remarks, in this way:
“Any measure coming from the hands of the senator from Rhode Island will be viewed with suspicion for reasons too well known to enumerate. If the country were inclined to the view that a central note issuing institution and bank of rediscount should be established, it would never consent to its establishment in New York or in Washington. In one it would be subject to the influence of the New York financiers and , in the other to that of their political friends in whom the country has but little confidence.”
Senator Aldrich is to speak at several western cities, and it is hoped that he will add to what he said at Chicago, rather than to hope for effectiveness in repetition. Banker J. B. Forgan was among those who studied the Aldrich effort patiently and conscientiously and spoke hopefully of the prospects, basing his beliefs upon what already has been done.
“I heard the speech and thought it a good one,” said Mr. Forgan. “It indicates to me that the commission did the work it was appointed to do, and that it has secured information that will enable it to create a good system for the United States. Senator Aldrich did not intimate what this plan would be, and I think he is very wise not to bring out a plan before he gets all his information digested.
“The commission is going at the subject in the right way, and I believe it will master it and evolve some good plan. He talked about the central banks of Europe and said those plans could never be adopted in this country without modification. He did not even advocate a central bank, although he may have a slight leaning toward it.
“I have little doubt that when the commission