Essays on Banking Reform in the United States

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Academy of Political Science, 1914 - Banks and banking - 228 pages
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Page 44 - A panic, in a word, is a species of neuralgia ; and according to the rules of science, you must not starve it. The holders of the cash reserve must be ready not only to keep it for their own liabilities, but to advance it most freely for the liabilities of others ; they must lend to merchants, to minor bankers, to "this man and that man...
Page 3 - It is in a general way known to the public that Mr. Warburg was in some way connected with the passage of the Federal Reserve Act, and his appointment' to his present responsible position on the Federal Reserve Board was acclaimed on all sides with a rare degree of approval and congratulation ; but I fancy it is known only to a very few how great is the indebtedness of the United States to Mr. Warburg. For it may be stated without fear of contradiction that in its fundamental features the Federal...
Page 232 - University and is composed of men and women interested in political, economic and social questions. The annual dues are five dollars.
Page 152 - ... one pailful? When the lightning strikes, the unfortunate householder will in vain fight the fire with his one pailful of water, while the other citizens will all frantically hold on to their own little supply, their only defense in the face of danger. The fire will spread and resistance will be impossible. If, however, instead of uselessly dividing the water, it had remained concentrated in one reservoir with an effective system of pipes to direct it where it was wanted for short, energetic and...
Page 144 - The quick assets held by European banks against their deposits consist of discounts or call loans, largely secured by discounts. The quick assets of American banks — promissory notes being unsalable and cash reserves being unavailable — are primarily call loans on stock and bond collateral.
Page 231 - The Quarterly follows the most important movements of foreign politics, but devotes chief attention to questions of present interest in the United States.
Page 176 - with every untrained amateur a candidate for any office, where friendship or help in a presidential campaign, financial or political, has always given a claim for political preferment, where the bids for votes and public favor are ever present in the politician's mind, .... a direct government management, that is to say, a political management, would prove fatal .... There...
Page 175 - ... left in the hands of business men, and that the government should be kept out of business The Owen-Glass Bill proceeds, in this respect, more on the lines of the Banque de France and the German Reichsbank, the presidents and boards of which are to a certain extent appointed by the government. These central banks, while legally private corporations, are semi-governmental organs inasmuch as they are permitted to issue the notes of the nation — particularly where there are elastic note issues,...
Page 108 - ... central bank in this country, however, would be confronted with exactly the same difficulty. More and more, as we have seen, central banks rule by persuasion, — a method which is possible because of the concentration of management and responsibility which has resulted from the growth of branch banking. We already have far more centralization of banking power in New York than is generally realized. Before the crisis of 1907 the six largest New York national banks held net bankers...
Page 105 - ... between banking in this and in other countries. Elsewhere the central bank is simply the final step in banking systems, which without it would in any case be highly centralized.1 How fundamentally important is this preliminary concentration will appear in our analysis of every activity of central banks. In order to distribute its funds widely, the central bank would be obliged to lend to at least as many banks as there are localities; and, since the selection of a single bank would give rise...

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