424 CHARLES J. BULLOCK 



are closely connected with various industrial interests, so that 

 they do not occupy an independent position. Their policy is 

 not controlled with sole regard for the general welfare of our 

 banking system; but they have been drawn into vast enter- 

 prises, into promotions, or reorganizations, often of a specula- 

 tive character, and have displayed less, not more, than ordi- 

 nary conservatism. The National City bank stood sponsor 

 for the Amalgamated Copper company, and the First National 

 has lent its aid to the various undertakings with which Mr. 

 Morgan has been identified. This is not to say, even by re- 

 motest implication, that the safety of the banks have been en- 

 dangered by such transactions; but it is mentioned in order 

 to illustrate the fact that these institutions are not free to 

 husband their resources in order to insure the stability of the 

 money market, and are not, at present, qualified to assume 

 the roles of the Bank of England and the Bank of France. It 

 is to be feared that our financiers have not yet learned the dif- 

 ference between banking and the promotion of companies ; but 

 until this distinction is better understood, New York city will 

 not rival London as an international financial center. 



One thing, however, may be conceded to the claim that 

 the union of banking interests already effected may do some- 

 thing to mitigate the severity of future panics. A mere increase 

 of capital will accomplish nothing in this direction, if banks in 

 the day of prosperity, use their credit up to the hilt in their or- 

 dinary enterprises. But the common control of large groups 

 of institutions may develop the habit and power of more effect- 

 ive cooperation. This will not, it is true, avert the inevitable 

 consequences of over speculation; it will not prevent a certain 

 depletion of bank reserves under the demands made by depos- 

 itors whose affairs have become involved; but it may allay that 

 senseless feeling of panic which is always responsible for some 

 of the worst features of a crisis. In a situation where purely 

 psychological forces play so large a part, even the expedients 

 of the faith curist are not to be despised. 



The concentration of banking power has now proceeded so 

 far that discussion has inevitably arisen concerning the length 

 to which it will be carried and the possible dangers of the 

 movement. In the counting room and upon the street New 



