Financial district

“ Merchant: Now it seems to me as though that organization is as simple, direct and complete as it can possibly be. It makes every zone an absolutely independent banking democracy. No outside influence is permitted to interfere with the zone. It is certainly local self-government from top to bottom. The fact that anyone in the zone may appeal to the Bankers' Council for redress and that every district has two representatives upon that board, will insure fair consideration at the hands of the Board of Control. ”

“ The defendants contend that the reporter's privilege does not apply to this case because Mr. Robinson has been subpoenaed regarding a book he is writing for his own personal gain and not for The Washington Post. The Court must reject any distinction on such grounds. First, the fact that the news gathering is conducted for financial gain is irrelevant. Reporters normally receive salaries for their news gathering efforts, Such financial gain does not taint the importance of the services to our cherished first amendment goals. ”

“ The fact of vital interest is that, despite confusion from the intermingling of utilities, the order of dependence of each definite district on the other is always the same. Residences are early driven to the circumference, while business remains at the centre, and as residences divide into various social grades, retail shops of corresponding grades follow them, and wholesale shops in turn follow the retailers, while institutions and various mixed utilities irregularly fill in the intermediate zone, and the banking and office section remains at the main business centre. ”

“ Each group of banks is to choose two directors: a Class A director, who is to be an active banker representing the stock-holding banks, and a Class B director, who must be actively engaged in commerce, agriculture, or some other industrial pursuit in his district. The board of directors of each member bank is to elect a district reserve elector. Candidates for the position of director of a Federal Reserve Bank may be nominated by any member bank ”

“ 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 banker who lives in the district, who has always lived there, whose whole mind is a history of the district and its changes, is easily able to lend money safely there. ”

“ Every district has its local bank, of a size to suit its wants, the stock of which is owned by the small capitalists of the neighbourhood, and managed by themselves; the consequence of which is, that in no part of the world is the system of banking so perfect—so little liable to vibration in the amount of loans—the necessary effect of which is, that in none is the value of property so little affected by changes in the amount or value of the currency resulting from the movements of their own banking institutions. ”

“ To avoid the folly of locking up large amounts of money received for taxes each year on the one hand, or permitting stock-gamblers and money-sharks, on the other hand, to use it, each district was allowed by law to issue district banknotes of one dollar denomination, guaranteed by the Government, drawing two per cent. a year interest up to eighty per cent. ”

“ 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. ”

“ In many rural communities, taxing districts are burdened with the costs of building monumental schools or a very elaborate system of roads, undertaken at some time through the flotation of bond issues. The establishment of a sinking fund for payment of interest and amortization of these bonds frequently constitutes a very heavy drain upon the residents of the district. It is, therefore, necessary to determine not only the tax rate in the locality under consideration, but also to know definitely what are the current charges for maintenance of government. ”

“ Some States should have several financial centres; some none. To attempt to make a commercial zone conform to State lines would be absurd. Bank credit flows to centres as [Pg 420] water rushes to the ocean, and we should not violate a great economic law to the irreparable injury of commerce. Sense and not sentiment should control our action.
St. Louis and Kansas City are natural financial centres, but Jefferson City is not. St. Louis draws its bank credits from eastern Missouri, southeastern Iowa, northeastern Arkansas and southern Illinois. ”

“ Hence central organisations act as money equalisers between the different societies. In some districts money is superabundant, in others it is deficient. The central bank acts as a channel through which the abundance of one district can be drawn to supply the scarcity of another, the operations being conducted by means of current accounts with both parties. In Germany as a whole the societies of small agriculturists of the Southwest have always an abundance of money, which is one [Pg 545] reason why they dispense so much of their funds in the purchase of property transfers. ”

“ Any national banking association not situated in a central reserve city may make loans secured by improved and unencumbered farm land, situated within its Federal reserve district, but no such loan shall be made for a longer time than five years, nor for an amount exceeding fifty per centum of the actual value of the property offered as security. ”

“ Several defendants, Malony, Anthony, Richardson, Stark and London, allegedly used the conspiracy as a means for financial gain. (Am.Compl. ¶ 4.) Over a seven year period, defendants allegedly conspired to attempt to obstruct justice in several court proceedings by improperly influencing those proceedings, obstructing justice, deceiving judges, committing wire, mail and common law fraud, acting negligently, and defaming plaintiffs so as to foreseeably injure them. ”

“ An individual's sales and purchases are seldom made at the same time, and the sales and purchases of communities are not constantly balanced. The trade of a one-crop farming district will not be so evenly balanced as one of a district in which mixed farming prevails, and in every industry there are periods, usually recurring every year, when the payments exceed the current income, and corresponding periods when income exceeds outgo....
A region like the cotton states, whose products move quickly to market, may have large credit balances at one season and at another be wanting to borrow.... ”

“ In launching a concern of such tremendous importance, probably destined to affect profoundly a vast industry, it is always deemed vital to have the support of the largest financial center possible. New York was then, as now, the great haunt of capital in the United States. Many of its leading men were only too anxious to identify themselves with the new exploitation. I did not think that the question of headquarters was one deserving mature consideration, especially inasmuch as San Francisco, controlling the stock issues, would necessarily be the great beneficiary in the long run. ”

“ It is equally inevitable that some localities are going to be blessed with more taxable assets than others. [109] Nor is local wealth a static quantity. Changes in the level of taxable wealth within any district may result from any number of events, some of which local residents can and do influence. For instance, commercial and industrial enterprises may be encouraged to locate within a district by various actions—public and private. ”

“ That each commercial zone shall maintain and keep in operation at its financial centre a clearing house where all the bank notes, checks, drafts, bills of exchange, and other instruments of credit, drawn upon any bank located in the zone, may be cleared, and for any other purpose that may come within the purview of this Act; and all such instruments of credit shall be accepted and settled for at par at such clearing house, under and in accordance with such rules and regulations as may be established from time to time by the board of directors of the American Reserve Bank. ”

“ The Pennsylvania Railroad now relies largely upon its stockholders for new capital. But a132 corporation with its long-continued success and reputation for stability should have much wider financial support and should eliminate the banker altogether. With the 2,700 stations on its system, the Pennsylvania could, with a slight expense, create nearly as many avenues through which money would be obtainable to meet its growing needs. ”

“ At the same time, these commercial zones should be so harmonized and federated as to give to each the financial strength and power of all combined, precisely as every State is as strong and powerful politically as the Federal Government itself. ”

“ 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. ”

“ These 354 Massachusetts municipalities carry in the aggregate large bank balances. Sometimes the balance carried by a city represents unexpended revenues; sometimes unexpended proceeds of loans. On these balances they usually receive from the banks 2 per cent. interest. The balances of municipalities vary like those of other depositors; one having idle funds, when another is in need. Why should not all of these cities and towns coöperate, making, say, the State their common banker, and supply each other with funds as farmers and laborers coöperate through credit-unions? ”

“ The person with a fixed income who settles in a district wishes the district to remain picturesque, rural, and quiet, and, above all, he desires that the 'rates' may be kept down. He naturally objects to be taxed for the sewering of country roads in order that the fields may be covered with courts and alleys of jerry-built houses, and equally he objects to be taxed in order that every railway station in the country may display a large invitation to trippers to invade his solitude and make his life a burden. ”

“ Generally, a District Court cannot acquire jurisdiction over an individual without service of process upon him while in the district for which it is held. But here a national bank seeks to enjoin the Comptroller, and the claim is that by statutory direction the proceeding must be had in the district where the association is located, and not elsewhere. ”

“ There will always be wide differences between the capital and other resources of the various Federal Reserve Banks. Neither the capital nor the resources of existing banks can be made the basis for dividing the country into Federal Reserve districts. Geographical consideration will necessarily require the creation of a number of districts in sparsely settled parts of the country, in which banking resources are comparatively small. No Federal Reserve Bank may, however, be established until it has a subscribed capital stock of at least four million dollars. ”

“ Those branches which have not over $100,000 capital are not to issue in excess of twice the capital, and larger banks a smaller proportion. The Board of Control is to replace worn and defaced notes. Each branch is to give to the Board of Control, as a safety fund, ten per cent. of its circulation in money, or stocks of Ohio, or of the United States. This fund is to be invested in mortgages, and the interest on it is to go to the depositing branches. All the stockholders in any branch are to owe to it, in the aggregate, not more than one-third of its capital. ”

“ That statute authorizes every county in the state to subscribe for stock in any railroad company, already or thereafter to be organized or incorporated, to the extent of $100,000, and, for the payment of the same, expressly empowers them to borrow money, at a rate of interest not exceeding 10 per cent. ”

“ We have seen that the committee appointed by the company to seek financial aid from the county expressed, officially, the belief that upon the completion of the road its earnings would soon furnish all the equipments required for increased business, pay off the $1,500,000 mortgage, provide for the payment of the county bonds then asked for, and in six or seven years thereafter commence paying on the bonds issued by the State for the benefit of the company. ”

“ The New York Stock Exchange is the strongest single influence maintaining the financial section. The proposition considered some years ago of moving the Stock Exchange above Prince Street, and on another occasion to 14th Street, if accomplished would have removed all the Stock Exchange brokers and the majority of the Banks and Trust Companies, private bankers, Safe Deposit Companies and lawyers, with disastrous results on land values in the financial section. The leading Exchange varies in different cities according to the dominant form of business. ”

“ They have no power at all to affect the valuation of real estate except once in ten years. They have no power over the valuation of personal property, including all money capital, except bank shares, as it is fixed by the county and city boards; and these being beyond their control, the effort of the State board to raise the assessment of the shares of banks to their value in money only increases the glaring inequality arising from the valuation of the county boards. ”