Bank (geography)

“ In general, all banks are beautiful things, and will reward work better than large landscapes. If you live in a lowland country, you must look for places where the ground is broken to the river's edges, with decayed posts, or roots of trees; or, if by great good luck there should be such things within your reach, for remnants of stone quays or steps, mossy mill-dams, etc. Nearly every other mile of road in chalk country will present beautiful bits of broken bank at its sides; better in form and color than high chalk cliffs. ”

“ The small capital with which we have permitted banks to be established also has undoubtedly been a contributing factor to our rapid economic development, as well as to the promotion of the banking habit among our people.
In the next place, the density of population is, of course, an important factor for the growth of credit exchanges. A larger volume of business is settled by bank paper in a commercial center than in an agricultural community, even though the proportion of total business thus settled may not be larger. ”

“ The money paid for these new lands went back again as public funds to the deposit banks, to be lent out again and to return in the same way. Thus the money went round and round in the same circle, carrying larger and larger quantities of public lands from the government to the speculators, the government receiving for the land in fact only bank credits. No wonder the land speculation grew beyond all bounds. ”

“ As the Bank of England is the channel through which, directly or indirectly, payments are made and moneys received, by other banks, it is more convenient for them to have their reserve lying as a deposit in it than lying as gold within their own vaults. ”

“ Another form of desirable legislation in the interest of the farmer consists in the abandonment of our unscientific bond secured bank-note circulation for a scientific system, and in the rendering of our deposit currency more elastic. The more the farmer resorts to bank credit as a means of financing his current business the more will he suffer from the seasonal inelasticity of our bank-note and deposit currency. ”

“ There is a network of relationship between banks through which each local community and market is connected with all other communities and markets.... No locality is so remote as to be outside of the circle and no community's sales and purchases are so scattered but that they can be brought together in the settlements. Each bank is the center of a circle of which it is the clearing agent; all payments between its own customers may be made by a transfer of credit upon its books. ”

“ First of all, let me state the simple fact that when you deposit money in a bank the bank does not put the money into a safe deposit vault. It invests your money in many different forms of credit—bonds, commercial paper, mortgages and many other kinds of loans. In other words, the bank puts your money to work to keep the wheels of industry and of agriculture turning around. A comparatively small part of the money you put into the bank is kept in currency—an amount which in normal times is wholly sufficient to cover the cash needs of the average citizen. ”

“ Here the great hall of the bank, full of panic-stricken citizens jostling one another to get gold for the notes of the bank; there, foreign nations sending over ingots and coin to the bank, and the Mint working night and day, Sunday and week-day, to turn them into sovereigns to meet the run. ”

“ Each bank is seeking, through its branches, to satisfy all the legitimate needs of the people for a circulating medium. When the note of a bank is in circulation it is earning money for the bank, but when it is in the vault or on the counter of the bank it is an idle and useless piece of paper. Hence every bank always pays out its own notes through its branches and sends the notes of other banks in for redemption, thus increasing its own circulation and strengthening its own reserve. ”

“ A bank even of loose earth, six feet high, will sometimes overhang its base a foot or two, as you may see any day in the gravelly banks of the lanes of Hampstead: but make the bank of gravel, equally loose, six hundred feet high, and see if you can get it to overhang a hundred or two! much more if there be weight above it increased in the same proportion. Hence, let any capital be given, whose projection is just safe, and no more, on its existing scale; increase its proportions every way equally, though ever so little, and it is unsafe ”

“ A remarkable example of such accumulation is the well-known shell-bank a mile and a half south of New Harmony, Indiana, and situated on a high hill 170 feet above the level of an arm of the Wabash River. The bank covers an area of a quarter of an acre, and has attracted the attention of eminent scientists like Leasure, Say, Lyell and others, but nothing of value was developed that would refer the construction of this and similar banks to any people more ancient than the Mound-builders. ”

“ The grading of the amount of capital required according to the population of the place in which a bank is located has been chiefly due to the desire to bring about some adjustment between the capital of each bank and the volume of its business. It is assumed that the larger the business of the bank the greater the chance of its suffering large losses and the larger the capital necessary to protect its depositors against loss. It is also assumed that the size of the city in which it is located is a rough index of the volume of business done by a bank. ”

“ The use of the banks belong also to the public by the laws of nations, as the use of the river itself does. Therefore, every one is free to moor his vessel to the bank, to fasten his cables to the trees growing on it, to deposit the cargo of his vessel in those places in like manner as every one is free to navigate the river itself. ”

“ By the laws of the United States, any five or more persons with sufficient capital may organize a national bank. A national bank may issue its notes--that is, its promises to pay--as currency, to an amount not exceeding the amount of United States bonds deposited by the bank with the national government. Each federal reserve bank is a large central bank organized by the banks of a certain district. ”

“ The bank is the great British storehouse for gold, keeping on deposit the reserves of the joint-stock banks and the private bankers of London, and it will have in its vaults at one time eighty to one hundred millions of dollars in gold in ingots, bullion, or coin, this being the basis on which the entire banking system of England is conducted. ”

“ All bank reserves should consist of gold or gold certificates, as soon as the United States notes can be converted into gold certificates.
Sixth: Every bank in the United States should be brought under national control, because banking is essentially Interstate Commerce.
Seventh: Every natural financial centre in the United States should become the clearing centre for all the checks, drafts and bank notes that are payable in the territory that is economically and naturally tributary to that Financial centre; such territory should constitute a commercial zone. ”

“ By the purchase of these bills, payable in the notes of the Bank, the merchants of the South have been enabled to pay the planters of Louisiana, Mississippi, Alabama, Tennessee, and other States, for their cotton; who in turn have been enabled to pay their debts to the country merchants; and these last again to the merchants in New York and Philadelphia. ”

“ Since the time of the Romans, beyond their first bank have been many intakes, by successive banks, of the best ground in the world left by the sea, which contracts its own limits by throwing up banks of sand out of the estuary: so that, from time to time, the land-owners upon these frontiers gain several thousands of acres. ”

“ A country bank dealing with the farmers might require the smaller amount, while a bank dealing entirely with bankers would require the largest possible reserve, to meet any emergency at any time. Each individual bank must be judged by itself and its reserves adjusted accordingly. ”

“ Now all these varied operations must go on; all these remittances must be made, bank of the United States or no bank. The bank does not create, but facilitates them. The bank is a mere vehicle; just as much so as the steamboat is the vehicle which transports our produce to the great mart of New Orleans, and not the grower of that produce. It is to confound cause and effect, to attribute to the bank the transfer of money from the west to the east. ”

“ In the case of a demand on their reserve, the banks will draw out their deposits, in notes, or, if gold be in demand, in gold, from the Bank of England. Whether, therefore, the reserve of a bank is invested in Government securities or is deposited in the Bank of England, or is in Bank of England notes, it is from the coin in that bank that the gold comes in the case of a run. ”

“ I have it on the authority of the secretary of the Chamber of Commerce of New York that the banking power of the United States is practically 40 per cent. of the banking power of the world. And this I read in a commercial review a few days ago: “The bank deposits of the United States amount to more than double the whole world’s known supply of gold. They are about equal to the whole volume of money in the world, counting gold, legal tender, currency, etc. ”

“ The notes of each bank will be confined within so narrow a district, or will divide the supply of a district with so many other banks, that on the average each will receive no larger amount of interest on his notes than will make up the interest on his own capital to the ordinary rate of profit. ”

“ He must himself inspect and sell produce. Loans are made, for instance, secured by growing crops; the bank sends a man to the plantation [Pg 572] to look over the coffee or cocoa, or whatever the crop may be, and report on its condition and prospects; to protect itself the bank sees that it is properly prepared for shipment, and takes care of the sale in the New York, London, or Hamburg market. The bank collects the proceeds and credits the customer with his share. Interest rates run from 8 to 15 per cent. and commissions for selling from 1 to 3 per cent. ”

“ The reason is that a central bank which is governed in the capital and descends on a country district, has much fewer modes of lending money safely than a bank of which the partners belong to that district, and know the men and things in it. A note issue is mainly begun by loans; there are then no deposits to be paid. But the mass of loans in a rural district are of small amount; the bills to be discounted are trifling; the persons borrowing are of small means and only local repute; the value of any property they wish to pledge depends on local changes and local circumstances. ”

“ A bank is the rising ground, or area, bordering a stream. To describe a boundary merely as following the course of the river bank gives it no definite location. Something more must be known before it can be laid down on the ground, e. ”

“ The inhabitants of the banking cities might obtain cash for their paper, as far as the cash of the vaults would hold out, but distance puts it out of the power of the country to do this. A farmer having a note of a Boston or Charleston bank, distant hundreds of miles, has no means of calling for the cash. ”

“ The government has established a string of land banks in order to loan money to the farmers to buy land and to improve their holdings. When a large estate is offered for sale the land is divided into small farms by government appraisers, who fix the value and make out the deeds to the purchasers. The land bank advances the money and takes a mortgage on the property for thirty-five years at 31⁄4 per cent., 21⁄2 per cent. being considered as interest and 1⁄4 per cent. being placed in a sinking fund to redeem the bonds that are issued to raise the purchase money. ”

“ For one cause or another, these private or trading banks have disappeared in England, and in the financial districts money is now a commodity, as it is in the United States, handled without imagination and with no sympathy or understanding of the needs of foreign business. An English or American bank of to-day is nothing more or less than a glorified pawnbroker, who will cheerfully lend ninety-five per cent. ”

“ That crises still degenerate on occasion into panics in America, but not in England, France, or Germany, arises primarily from differences in banking organization and practice. In each of the three European countries, the banking system as a whole is so organized by the prevalence of branch banking and the existence of a central bank that reserves which bear a small proportion to the aggregate demand liabilities of all the offices can be applied when and where they are most needed. ”

“ The high banks formed by the action of the stream in cutting through the rich soil vary from the right side to the left, according to the course of the stream—the corresponding bank on the opposite side being generally of a slope, more or less abrupt, as the bank is high. ”

“ In addition to these institutions, operating under the law of 1897, there were a loan bank for promoting agricultural and irrigation enterprises, six branches of foreign banks, a number of private banks, and a national pawn shop, which had some of the characteristics of a bank. ”