Dogger Bank

“ It is thus that an introduction of a new bank into the most distant of our villages, places the business of that village within the influence of the money power in England. It is thus that every new debt which we contract in that country, seriously affects our own currency, and extends over the pursuits of our citizens its powerful influence. We cannot escape from this by making new banks, great or small, State or National. The same chains which bind those now existing to the centre of this system of paper credit, must equally fetter every similar institution we create. ”

“ Commercial banks are unique among financial institutions in that they alone are permitted by law to accept demand deposits. This distinctive power gives commercial banking a key role in the national economy. For banks do not merely deal in but are actually a source of, money and credit; when a bank makes a loan by crediting the borrower's demand deposit account, it augments the Nation's credit supply. ”

“ Deposit banking operations affect not only the volume of money and credit, but also the value of the dollar and the stability of the currency system. In this field, considerations other than simply the preservation of competition are relevant. ”

“ The reason for the competitive disadvantage of most lending institutions vis-a-vis banks is that only banks obtain the bulk of their working capital without having to pay interest or comparable charges thereon, by virtue of their unique power to accept demand deposits. The critical area of short-term commercial credit, see pp. ”

“ How will the Bank of England be able to maintain its supremacy and control the money market, surrounded by banks individually greater and more powerful than itself, especially when the object in view is by raising the rate of interest to prevent an internal or external drain upon our gold reserve? ”

“ The company has founded at St.-Gobain a kind of savings-bank in which the workman may make deposits of from one franc to 400 francs, drawing interest at the rate of 4 per cent. per annum, until the maximum is reached, when the money is either paid back to the depositor or, if he prefers, invested for him, without charge by the company, in the public funds or in railway securities. In this way many of the workmen are coming to be small capitalists. ”

“ The plaintiffs in error submit that it is not.
The words of the charter are, that, in its loans or discounts, the bank shall not take more than at the rate of six per centum per annum.
The negotiation with Owens cannot, with any propriety, (now that the evidence is disclosed) be termed 'a loan or discount,' within the meaning of this section of the act of congress. The language of the act is properly applicable to the lending of money, that is to say, gold or silver. It is very true that borrowersseldom receive in gold or silver. ”

“ It was only after the debt was paid and the surplus revenue began to accumulate that the attraction of this bonanza overcame prudence and good sense. The popular sentiment now swung over again to a mania for banks. Each district wanted a deposit bank so as to get a share in the stream of wealth which was expected to flow from the public treasury. If a deposit could not be obtained, then a bank was formed in order to participate in the carnival of credit and speculation; for a non-deposit bank had the advantage of being bound by no rule. ”

“ Their aim was now to instil into the minds of the untutored Africans lessons of sobriety, wisdom, and economy, and to show them how to rise in the world. Like snowflakes in winter, circulars, tracts and other papers were, by this benevolent institution, scattered among the sable millions, and they were told to "look" to the Freedman's Bank and "live." Branches were established in all the Southern States, and as a result, money to the amount of millions flowed into its vaults. With the usual effect of sudden wealth, the managers felt like making a little display of their prosperity. ”

“ The ranchman whom Woodring had worked for previous to entering the bank, bought the squaw-man out, made Woodring cashier, and sold to him a block of stock and took his note for the amount. In time [Pg 160] Woodring proved a good banker and his efficient management of the institution, which had been a State bank with a capital stock of twenty-five thousand dollars, had been incorporated into a National bank and the capital increased to fifty thousand dollars, and later on to one hundred thousand dollars. ”

“ We are of opinion, that this instruction ought to have been given. It excludes any intention of violating the laws against usury; and it puts the case as a bona fide exchange of credits for the accommodation of Owens. Such an exchange is not per se illegal; though it may be so, if it is a mere shift or device to cover usury. If the application be not for a loan of money, but for an exchange of credits or commodities, which the parties bona fide estimate at equivalent values; it seems difficult to find any ground, on which to rest a legal objection to the transaction. ”

“ A Scotchman of the name of Paterson had some years previously suggested the plan of a national bank, by which the Government should obtain some of the advantages of the banker, and the public, while gaining the convenience of cheques, should have a better security than private goldsmiths offered. This scheme Montague now adopted. He borrowed rather upwards of a million, and formed the lenders into a banking company, allowing them to treat the loan to Government as part of their capital, the interest of which, secured upon taxes, gave them the requisite supply of ready money. ”

“ Occasionally, through auctioning off some poor debtor's effects, he came into possession of bank bills, 50, 100, 1,000 florin notes. These he rolled up separately, and pushed one by one into a hollow reed. Of those stuffed reeds he made bundles, which he stowed away in a corner of his room. He never lent a penny of his money; he never put a penny into any savings-bank, for he called them all humbugs; and he never gave a penny for charity or friendship. Such was my Uncle Diogenes or Dion ”

“ It had no right to contract any debt greater than $35,000,000, more than its deposits, unless by special act; the directors were made responsible for every violation, and could be sued by each creditor. They could only deal in gold and silver exchange, and not in other country securities which could not be realized upon at once. The Bank could purchase no public debt nor exceed 6 per cent. interest on its discounts and loans. It could lend no more than $500,000, to the United States, $50,000, to each State, and nothing to foreigners. It could give no bill of exchange greater than $5,000 ”

“ The use of banks has been the best method yet practised for the increase of money. banks have been long used in Italy, but as I am informed, the invention of them was owing to Sweedland. their money was copper, which was inconvenient, by reason of its weight and bulk; to remedy this inconveniency, a bank was set up [Pg 65] where the money might be pledged, and credit given to the value, which past in payments, and facilitate trade.
The Dutch for the same reason set up the bank of Amsterdam. their money was silver, but their trade was so great as to find payments even in silver inconvenient. ”

“ While recognizing that the information received as to a possible attack led the admiral to mistake the trawlers for the enemy, the majority of the commissioners held Rozhdestvensky responsible for the firing and its results, and “being of opinion that there were no torpedo-boats either among the trawlers nor anywhere near” concluded that “the opening of fire was not justifiable,” though they absolved him and his squadron from discredit either to their “military qualities” or their “humanity.” The affair ended in compensation being paid by the Russian government. ”

“ To Germans this seems very strange; a large part of the public cannot keep a banking account, and when it is in a position to do so either expects high rates of interest or keeps no permanent balances and pays no commissions. Under such circumstances there is no sense, from a business point of view, in the shoemaker, who has no banking account, accepting a check, which he has to cash, instead of ready money; for the shoemaker has to take an unprofitable walk, and the bank has to examine the check, pay and book it, and in some cases notify by letter the customer of its payment. ”

“ Conceivably a bank could use an armored car as a place of business by stationing it at designated places during designated hours for opening accounts, receiving deposits, making loans, and the like. But no armored car was so used in these cases.
Federal law stated in the McFadden Act, 12 U.S.C. § 36 (f) , defines 'branch' as any facility 'at which deposits are received, or checks paid, or money lent.' And Congress provided that national banks may establish 'branches' whenever, wherever, and however state banks may do so. ”

“ With the Bank of England thus acting as a centre to the system, there has grown up around it a circle of the great joint stock banks, which provide credit and currency for commerce and finance by lending money and taking it on deposit, or on current account. These banks work under practically no legal restrictions of any kind with regard to the amount of cash that they hold, or the use that they make of the money that is entrusted to their keeping. ”

“ Meantime the interior banks were compelled to pay to exporting merchants generous premiums for exchange bills upon Europe, through which, despite the high interest rates ruling in European markets, these banks were able to import 107 millions of gold for their own reserve requirements. In fact, the banking business involves the hazard not merely that some of the debtors of the bank may become insolvent, but also the general and overhead hazard attaching to its underwriting service that it may itself in time of stress become unable to meet its obligations. ”

“ I was about to protest, indignantly, when Jock continued, "Bide a wee, lad, and let me hae my say.
"Let's see what your live assets are," he continued. "There's your beesiness, o' course; but your bank account is only sufficient—barely sufficient, ye ken—tae meet your bills and current expenses. As a matter o' fact," he said gravely, "ye lost some discount last month for no' paying in ten days. I've told ye before never to lose discount. Borrow the money first. It pays to borrow money at six per cent. per year to make [Pg 335] it earn two per cent. in ten days—or thirty-six per cent. ”

“ Look up there. He is going to speak,” and she pointed to a balcony in the second story, where Judge White stood, waving his hands to enforce silence. He had inquired into matters a little, and learned from his cashier how much had already been drawn from the bank, and about how much currency there was left.
“Godfrey Sheldon’s five thousand was a blow,” the cashier said. “There are three more who have each a thousand deposited. They haven’t appeared yet, and I hope they won’t. It is the small depositors who are making the biggest row, and there is a pile of ’em.” ”

“ LOUIE COMES TO THE RESCUE When she heard the cry, “Put it in Grey’s Bank, where Sheldon has put his,” she started quickly, struck with a thought of something she had read about. Going into the bank, where two or three were already depositing their money, she drew her father aside and said:
“Do you think the White Bank can stand the run?”
“Doubtful, if the most of them pitch in as they seem likely to do. They are just crazy, and one excites the other.” ”

“ There is neither authority nor excuse for taking any risk. Let individuals, if they wish, invest in Georgia bonds. That is their own business. But the managers of a savings bank cannot run any such risk without failing in their duty to thousands of poor depositors.—N. Y. Herald, July 17, 1885.
The Attorney-General’s Decision. The decision of the Attorney-General, as was expected, wisely prohibited the savings banks of this State from risking any of the hard earnings of their large number of depositors in such an uncertain security as Georgia bonds. ”

“ The complaint is that the Eastern States have an undue amount of national-bank circulation, and therefore enjoy in a measure a monopoly. I admit this to be true. I will not discuss here the system of banking in all its aspects, but I will inquire how far the establishment of more national banks of issue in the West and South will remedy the real evil complained of—which evil consists in a lack of loanable capital there. If the remedy proposed is to serve any good purpose at all, then the establishment of new national banks of issue must increase the available amount of loanable money. ”

“ The words were caught up by those outside, and ran through the crowd like wildfire, gaining strength as they ran, until by the time they reached the outer circle it was affirmed that the bank could pay no more that day.
Those who have witnessed a run on a bank know how the excitement grows until people, ordinarily cool and sane, grow wild and mad, and howl sometimes like beasts at the prospect of losing their money. And so it was now at the White Bank, where the excitement was intense, especially among the small depositors—the women, whose little was all in the bank. ”

“ We didn’t know,” sadly from Douglas.
“I never heard of such extravagance. ‘A fool and his money are soon parted.’”
“We have got just exactly eighty-three dollars and fifty-nine cents in the bank. Father owns this house and a side of a mountain in Albemarle, and that is all.”
“Mercy, child! I can’t believe it.”
“We have got to live somehow, and I believe we all feel that it would be very bad for Father to come back and find debts to be paid off. He has such a horror of debt that he has always paid the bills each month. What do you think we could do—something to make money, I mean? ”