In Europe the average man looks upon the bank as a benefactor. Through its agency he secures capital at low rates for his business. In America the bank is too often regarded as a necessary evil, certainly not with affection. Yet it plays a most important rôle in the nation's economy. Our banking laws are obsolete, unsatisfactory, and actually in some instances detrimental to the best and widest use of the nation's resources. Europe has many lessons for us in the problem of how best to use our ac

The purpose of this book is to supply the general reader with a simple statement of the principles and problems of banking. Since it is designed primarily for American readers, special attention has been given to conditions in this country. An effort has been made clearly to draw the line between commercial and investment banking and to indicate the problems peculiar to each. That it may assist the average person in understanding present-day banking problems and thus contribute towards the forma

The terms, "bank" and "banking," are applied to institutions and to businesses which differ considerably in character, functions, and methods, but which nevertheless have certain common features which justify their being grouped together. We can best prepare the way for a discussion of these differences and common features by a description of the services which these institutions perform in modern society. From the point of view of their customers these services may be grouped under the followin

In the preceding chapter commercial banking has been defined as the conduct of exchanges by means of a world-wide process of bookkeeping. We must now describe this process. Its essential features are the discount of commercial paper, the conduct of checking accounts, and the issue of notes. By commercial paper is meant the credit instruments or documents which the credit system now in general use throughout the commercial world regularly brings into existence and liquidates. The essence of this

The conduct of commercial banking presents problems both to the bankers and to the public, the methods of solution of which will be given attention at this point. The problems concerning the bankers primarily may be grouped under the heads, supply of cash, selection of loans and discounts, and rates; and those which primarily concern the public may be grouped under the heads, protection against unsound practices, and adequacy and economy of service. The credit balances on checking accounts and t

The commercial banking system of the United States consists of several elements which have been contributed at different periods in our history. The most important of these are state banks, national banks, and the independent treasury system. From the very beginning of our national history institutions enjoying, among others, the privilege of commercial banking have been chartered by our states. For several years after the adoption of our constitution it remained an open question whether the inc

In contrast with that of the United States, the characteristic features of the commercial banking systems of Europe are the central bank performing important functions for all other financial institutions and for the government; a relatively small number of large institutions with many branches mediating between the central bank and the people; and the use of commercial and bank bills instead of promissory notes as the chief instruments of loans and discounts. The central banks differ considerab

In the economy of nations the encouragement and promotion of saving and the accumulation, distribution, and investment of capital are as essential as the conduct of exchanges, but the performance of these functions has not been segregated and institutionalized to the same extent as has commercial banking. Vast amounts of capital are invested directly by the people to whom it belongs without the aid of middlemen and large amounts are also invested through brokers of one kind and another who can h

The following books are comprehensive in character, treating most of the subjects covered in the foregoing chapters: Macleod, H. D. , Theory and Practice of Banking. Gilbart, J. W. , History and Principles of Banking. Bagehot, Walter , Lombard Street. Dunbar, Charles F. , History and Theory of Banking. Scott, Wm. A. , Money and Banking. Rev. Ed. White, Horace , Money and Banking. Fisk, A. K. , The Modern Bank. The subject of clearings and the exchanges are discussed in the following books: Canno

MONEY. William A. Scott , Director of the Course in Commerce, and Professor of Political Economy, University of Wisconsin TAXATION. C. B. Fillebrown , President Massachusetts Single Tax League, Author of A B C of Taxation THE FAMILY AND SOCIETY. John M. Gillette , Professor of Sociology, University of North Dakota BANKING. William A. Scott THE CITY. Henry C. Wright TRUSTS AND COMPETITION. John F. Crowell THE COST OF LIVING. Walter E. Clark STATISTICS. W. B. Bailey BASIS OF COMMERCE. E. V. Robins