Full text of Central Western Banker : July 1928, Volume 23, No. 7

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Federal Reserve Bank of St. Louis

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£T h e First Stage Coach
In 1859, two years after the organiza­
tion of the First National Bank of
Omaha, the Western Stage Company
operated its first stage line out of Oma­
ha. It extended from Omaha to Fort
Kearney, where it connected with the
Overland from Atchison.
The stage carried nine passengers and
averaged 115 miles a day. The fare
from Omaha to Denver was $75. And
travel was dangerous because of Indians
and hold-ups.


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Federal Reserve Bank of St. Louis

The First National Bank of
Omaha has assisted in the de­
velopment of steamboat, stage,
railroad, automobile and air­
plane . . . its service has also
been developed until it now of­
fers now one of the most com­
plete and modern banks in the
middlewest.
For those wishing investment
service, we offer it through
our First Trust Company.

First National

I Bank of Omaha

FIRST TRUST C O M P A N Y

D

ästminute
N E W d
T H E C E N T R A L T R U ST COMPAN Y of Chicago is increasing
its capital stock from $6,000,000 to
$8,000,000. Shares now quoted at
$500 will be offered to shareholders
at $200 each. One-half of the funds
received will be added to capital, and
one-half to surplus. This institution
was organized in 1902 by Charles G.
Dawes, now vice-president of the
United States.
T H E N A T IO N A L P A R K B AN K
of New York City, of which
Charles S. McCain is President, an­
nounces it will open two new branches
this year. This will give the bank
four branches in addition to its head
office.

.
I H ? :.'"

r

crnks
etnei rP)c-irikc,i:s'
merce and the Boatmen’s National
Bank of St. Louis, which will give the
proposed institution combined capital,
surplus and undivided profits of nearly
$ 17.000,000 and deposits of around
$ 100 ,000 .000 .
The Boatmen’s Na­
tional, which is the oldest bank in St.
Louis, has deposits of about $25,000,000, while the National Bank of Com­
merce has $75,000,000. It is pro­
posed to issue 83 shares of Bank of
Commerce stock for 100 of the Boat­
men’s. John G. Lonsdale is president
of the Bank of Commerce and Julius
W . Reinholdt is head of the Boatmens
National.
rT H E S T R A U S N A T IO N A L
1 RAN K & TR U ST C O M PA N Y of
Chicago has opened its doors for busi­
ness. It is capitalized at $1,000,000,
and has $250,000 surplus and $50,000
as a special reserve for contingencies.
S. W . Straus, the President of the S.
W. Straus & Company, is also presi­
dent of the Straus National Bank &
Trust Company. Other officers in­
clude S. J. T. Straus, Vice-President;

John H. Kraft, vice-president and
cashier; J. R. Frazer, vivce-president
and executive trust officer; and N. H.
Oglesbee, comptroller.
n r H E CAN AL B AN K & TR U ST
CO M PAN Y, and the Marine
Bank & Trust Company of New
Orleans have been consolidated under
the name of the Canal Bank & Trust
Company, with James P. Butler re­
maining as President of the consoli­
dated bank. Total deposits will be in
excess of $100,000,000.
1TH E O M A H A W IM S E T T SYS1 TEM CO M PAN Y, organized for
the purpose of making loans to salar­
ied persons on character plus earning
capacity, has been opened for busi­
ness. The company is capitalized at
$100,000 paid-up and $400,000 author­
ized. H. S. Weller is president of the
new concern.

t R V IN G G. GREEN, formerly vice1 president and cashier of the First
National Bank of Davenport, has been
made president, succeeding Senator A.
F. Dawson, who has resigned. W . M.
Brandon, formerly Credit Manager of
HTHE N A T IO N A L B A N K OF
the Iowa National Bank, Des Moines,
COMMERCE,
Seattle, began
becomes Cashier of the Davenport in­
business recently with all the assets
stitution. The First
and officials of the
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National of Davenabsorbed Marine Naport was the first Na­
Voi. 23 No. 7
JULY, 1928
tional Bank, in its
tional bank in the
new home. The Na­
United States to open
tional Bank of Com­
its doors to business
merce is a unit of the
Banking and Fruit Growing .
4
under the National
newly organized Ma­
Legal Department . . . .
5
Bank Act, although
rine Bancorporation.
Stop Losses— Create Earnings
6
it does not hold No. 1
BY P. L. H A L L
charter.
“ Tooting Your Own Horn” . . . .
7
A T
TH E Annual
Why Pay I n t e r e s t ? .................................
9
C on v en tion o f
R OSVEN OR
BY GEO. S. HOVEY
the American InstiJONES, chief of
The Clearing House P l a n ......................
tute of Banking held
the Finance and In­
BY DAN V. STEPH E N S
in Philadelphia, F. M.
vestment division of
Putting Banking on Sounder Basis .
lo
Totten, assistant cash­
the Bureau o f For­
BY C. F. COFFEE
ier of the Chase Na­
eign and Domestic
Bonds and I n v e s tm e n ts ......................
ID
tional Bank of New
Commerce at Wash­
Insurance
.................................................
21
York C i t y , w a s
ington, addressed the
Nebraska N e w s ......................................
24
elected
president suc­
Twin Cities Building
News of the Omaha Stockyards . .
27
ceeding P. R. W il­
Club at a recent
South Dakota N e w s .................................
30
liams, vice-president
luncheon in Minne­
Kansas N e w s ............................................
31
apolis.
of the Bank of Italy
Colorado N e w s ......................................
33
National Trust and
Savings Association.
T iie C e n t r a l W e s t e r n B a n k e r o f O m a h a
T U E G O T IA T IO N S
Published monthly at 416 Arthur Bldg., Omaha, Nebraska
He secured 100 more
* ^ are under way for
Subscription, 25 cents per copy; $2.00 per year.
Entered as second-class matter at the Omaha postoffice.
votes for this position
a merger of the Na­
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i

In Th is Issue

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Federal Reserve Bank of St. Louis

Central Western Banker, July, 1928

4
Denver. A total of 2,700 votes were
cast. W . J. Evans of Dallas, Texas,
was named vice-president. Frank H.
Delaney of the Merchants National
Bank of St. Paul, Minn., was elected
to the Executive Council.
W ARD
C. CASTLE, executive
** vice-president of the National
Bank of the Republic, Chicago, says
that Germany is making a more rapid
business recovery than any other coun­
try in Europe. Conditions in England

he says, are improving slowly, and
France has much rebuilding to do be­
fore the country can recover its war
losses. Mr. Castle on a portion of his
trip was accompanied by Arthur
Packard, resident vice-president of the
National Bank of the Republic in
London.
----------7 H E FIR ST N A T IO N A L B AN K
1 OF P H IL A D E L P H IA , holder of
Charter No. 1, established by Jay
Cooke, Civil War financier, recently
celebrated its 65th anniversary.

FA O N DeVEY, of Westport, is
chairman of the committee on
Analysis of Accounts of the South Da­
kota Banker’s Association, which has
recently published a very interesting
bulletin on the subject of “ Does the
Account Pay?” C. A. Stensland of
Madison and M. I. Orms of Sioux
Falls were also members of the Analy­
sis Committee.
If you cannot win the race, make
the one ahead break the record.

Banking and Fruit G r o w i n g
'“T H E time is not so far distant when
^ Nemaha county, Nebraska, in the
vicinity of Brownville and Auburn
will take its rightful place among the
leading fruit growing areas of the
world, is the opinion of a genial Au­
burn banker, W . H. Bousfield, cashier
of the First National Bank of A u­
burn.
One of the reasons for Mr. Bousfield’s belief lies in the fact that he,
with five other substantial Auburn
business men, recently purchased 253
acres of fruit land near Brownville,
at $180 per acre and plan to grow
fruit on a large scale. J. B. Stivers,
an expert fruit grower, who is also
manager for the Central States Or­
chard company of Duluth, will be in
charge of the farm.
O f the 253 acres, 80 acres already
have bearing apple trees. The re­
maining 173 acres will be devoted
to both apple and peach trees, with
17,000 apple trees and 6,000 peach
trees as “ fillers.” The peach trees
will bear in about three years, and
apple trees in four or five.
Auburn, according to Mr. Bousfield,
has a substantial canning company,
in which he is financially interested.
Last year 44 carloads of grapes were
shipped out of Brownville, alone.

Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

Business Very Good
“ The banking business is quite sta­
ble, and we have no complaints to
make at all,” says Mr. Bousfield. De­
posits of the First National are now
more than half a million dollars, which
is quite normal for us and is just
about all the business that we are
equipped to handle. W e can’t expect
more business until agricultural con­
ditions improve. By that I mean that
the farmer, although doing fairly well,
is entitled to better prices for his pro­
ducts.”
There is no service charge at Au­
burn, although it is a necessary part
of profitable banking in Mr. Bousfield’s estimation. There is an active
county association in Nemaha county,
all but one bank in the county being
a member. At the present time, the
association is atempting to bring
about a reduction in interest rates
from 4 to 3 per cent.
Auburn banks report a fair demand
for local loans, with rates around 8
per cent, most of them the usual ag­
ricultural loans. Farming in that vi­
cinity is excellently diversified, in­
cluding a substantial amount of win­
ter wheat, and thus relieving the banks
from an excessive demand for money
at any particular moment.

The First National has a fair sized
bond account and reports a fair de­
mand among its customers for bonds,
mostly government. The demand for
farm mortgages is also active there.
Farmers in the vicinity of Auburn
are in good financial shape, with little
demand for legislation for farm relief.
This may be partially due to their di­
versification, which includes corn,
wheat, oats, fruit, dairy cows, cat­
tle and hog raising and miscellaneous
income producing farm produce. The
county was not greatly affected by the
land boom of a few years ago, and
land there is still selling at very rea­
sonable prices. “W e might be termed
old-fashioned, conservative, or what
have you,” declares Mr. Bousfield,
“ since we have no rich people, but
we do have in our community a great
many home owners who are comfort­
ably situated. In fact, southeastern
Nebraska has more good sized estates
than any other section of the state.
“ W e are very proud of our soil,
which is the famous 'Loess soil,’ a
sandy loam specially adapted to fruit
growing, and much similar to the val­
ley of the Nile. It is many feet in
depth and has no subsoil, thus insur­
ing the continuous fertility of this part
of the state.”

5

When the Deposit Is T o Pay
ONLY
An Outstanding Check
By The C entral W

estern

Banker Legal Department

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W H A T THE L A W SA YS
“ W here a bank, through its president, agrees with
to this and said it would
a customer who is indebted to it on a demand note, that,
Q C C A S IO N A L L Y , a
be all right.”
if he purchases an automobile to sell in his business to
bank depositor makes a
Mazz, in reliance upon
a prospective buyer and issues his check on the bank
special arrangement with
such an arrangement with
therefor, the check will be paid, provided that by the
the bank to deposit a speci­
the bank, went to the fac­
time such check is presented the drawer shall have de­
fied sum of money in the
posited the proceeds of the sale with the bank, and, in
tory, purchased the car
bank at a certain time,
pursuance o f such agreement, the customer issues his
from the agent and gave
notifying the bank that a
check for the automobile, which he sells and deposits
his check for $2,200.05,
check has been issued for
the proceeds o f the sale with the bank, the holder of such
which the factory accepted
the amount of the deposit.
check is entitled to recover the amount thereof from the
in reliance upon the repre­
A deposit of this nature is
bank, notwithstanding nothing was said at the time of
sentations of Mazz as to
often referred to as a
the deposit about the application of the funds so de­
his arrangement with the
special deposit.
Reed Bank. Mazz received
posited
At the time such a trans­
the car so purchased, de­
action is made with the
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livered the same to his cus­
bank, the depositor may
tomer and on the following
even be indebted to the
morning received a check
bank on an overdraft and
therefor
in
the sum of $2,425.13,
other overdue obligations. There have
amount in the bank to meet his check
drawn on another bank in the same
been many cases where a bank has ap­ given to the factory agent.
Prior to the transaction in ques­ city where the Reed Bank was
plied such a deposit on the amount
due the bank at that time and then tion, Mazz had a telephone conversa­ located. Then on the next morn­
ing, Mazz deposited such check with
tion with the president of the bank.
refused to honor the check which was
the Reed Bank and the bank immedi­
The
substance
of
the
conversation
especially drawn on this deposit.
ately obtained payment upon the check
over the phone was as follow s:
Can a bank apply the amount of
from the bank on which it was drawn
“ After completing arrangements
such a deposit to the depositor’s ob­
and applied the proceeds thereof to
for
the
sale
of
the
car
to
the
cus­
ligations due the bank?
the payment of Mazz’s overdraft of
The Reed Bank did this, and the tomer, he called up the president and $50.15, and upon a demand note for
asked
him
when
his
check
given
that
depositor, named Mazz, brought an
$4,000.00 which the bank held against
action in court against the bank, al­ day to the factory agent would get Mazz. Mazz was insolvent. Subse­
back from the office of the agent in a
leging that the bank had no legal right
distant city. That he was purchas­ quent to the deposit of the custom­
to apply the deposit to his obligations
ing a car for his customer from this er’s check, but during the same day,
due the bank.
the check given to the factory agent
factory agent, who would not receive
The Case in Detail
his check until six o’clock that even­ was presented to the bank and pay­
For a period of over seven years,
ing. That his customer wanted to use ment refused. That thereafter Mazz
assigned $2,200.05 of the amount so
Mazz had maintained a deposit and the car for Sunday and that he would
deposited to the factory agent by a
checking account with the Reed bank.
not receive the customer’s check for
written
assignment. That was present­
Mr. Mazz was engaged in the pur­
the car until Monday or Tuesday.
ed to the Reed Bank and payment
chase and sale of new automobiles in That when he received this check he
the city where the bank was situated.
would make a deposit of the same at thereon demanded which was refused.
The deposit of the customer’s check
It was, and had been his general prac­ once, possibly the first thing Monday
was made in the Reed Bank, pursuant
tice, known to all the parties involved
afternoon, or Tuesday morning. The
in the transaction, to obtain an order
president told him that the check to the conversation between Mr. Mazz
and the president of the bank for the
from a customer for an automobile
would not get back until Tuesday
and then to purchase a car from the morning. Mazz then said to the presi­ purpose of creating a fund therein to
meet the check given to the factory
factory agent, giving his check there­ dent of the bank, “ All right, I will
agent
and the bank received such de­
for, drawn on the bank with which to
go up, get the car, and I will bring
fill such an order. Then he would
the customer’s check in just as soon posit for such purpose to the amount
(Continued on Page 16)
collect for the sale and deposit the as I receive it.” The president agreed


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Federal Reserve Bank of St. Louis

Central Western Banker, Jidy, 1928

6

A D o z e n W ays to

Stop Losses and Create Earnings
Y V /E A R E all in business to make
™ money and an analysis seems to
indicate that each individual at the
present time must work out his own
solution. True we have many cus­
toms and departmental rulings that
help us to stop loss and increase our
earnings, but we do not have enough
of them at the present, generally
speaking, to bring us back to a pay­
ing basis, where bank stock will be
worth possessing. When a bank
makes money, it can pay salaries—
dividends— losses, and fit into its right­
ful place in the community and in no
other way. Let us take up a few ope­
rations that can and do effect our
earnings.
Fires
Just imagine that some morning
about four-thirty a. m. some one al­
most breaks down your front door,
and about the same time the fire siren
starts and the faint cry of “ fire” floats
into your bed chamber. You rear up
out of a sound sleep and attempt to
get into the w ife’s slippers, with your
pants on backwards, and you dash
through the front door trying to make
a shirt out of her kimona. You charge
up town to find the old shop is mak­
ing a riot of Fourth of July colors, as
the flames leap for the blue heavens.
Then a chill runs up your spine. “ My
God,” what were those papers you
left on your desk, and then the col­
lections in the cash drawer. You al­
most collapse as you try to remember
what you forgot to put in the vault.
Keep your building and fixtures
well insured. Buy or build a small
vault truck, and at night when you
lock up the shop see that everything of
record goes on the truck. Shove it
in the vault and let come what may.
Bank Robbers
Just imagine your delight upon ar­
riving at your bank some morning to
find the window shades all down,
half of your counter laying in the
lobby, plaster all over everything, the
vault door shoved across the postingmachine, your safe door in the private
office up front. Then you slip into
the vault with a morgue-like feeling
and right in front of you on the floor,
mixed with other valuable records you
pick up two perfectly good frozen
notes, perforated with soap and partly
destroyed.
Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

By P. L. H a l l ,
President, Greenwood State Bank,
Greenwood, Nebraska

The old square safe door is simply
a wreck. O f course it is assumed that
Bill Hughes has your money covered
with insurance. But how about the
papers, bonds, etc., both your own and
customers.
No record!
“ Page a
nerve specialist quick!”
Keep well insured— keep a liability
ledger to protect your notes, so you
can go into court if necessary, with a
perfect record and demand payment.
If your vault and safe are inade­
quate, build a new concrete vault,
large enough to house your vault
truck. Buy a Manganese safe if you
haven’t one. Equip your doors with
locking devices and gas. Sure these
things cost a little money, but you do
not hesitate to buy a new up to date
automobile every so often to keep up
with the times.
Daylight Holdups
Do not keep securities and negoti­
able instruments in your safe or cash
drawer, at least keep them where the
robbers will not fall over them.
“ Enough said.”
Loans
Now about those frozen loans of
some of your good customers that you
might make sore if you asked them to
reduce. Tie up with some good Trust
Company. Make the frozen loan bor­
rower a farm loan, or increase his
present farm loan. Pay off your loan
— giving him a five or five and a half
per cent rate— make one-half per cent
commission for yourself in making the

The C artoon o f the M onth.

loan. Now step to the time certificate
ledger and line up some of your heavy
frozen time depositors, sell them the
farm loan you have just made and
make another one-half per cent in ad­
dition to saving three to four per
cent interest the next six months on
the time certificate.
Insurance
Start an insurance agency. W ork
it with your loans to protect your bank
against death, fire, tornado, auto lia­
bility, hail, etc., all of which may hap­
pen to your borrowers. This will
Bring in a nice revenue, besides the
protection to your bank. Be sure and
pick out good substantial companies.
Mortgages
I assume all banks take the Daily
Record of Mortgages published at the
County Seats. Instead of throwing
these in the waste basket, or just fil­
ing them away— record all local mort­
gages alphabetically in a Ledger. You
will be surprised at the number of
duplicate borrowers it will show up in
a little while. When a new customer
comes into your bank cursing his old
banker, (your competitor in the next
town) accusing him of being a crook,
and wants to move all his business
over your way by borrowing a little
money, do not be surprised upon look­
ing him up in your Mortgage Ledger
to find him thoroughly plastered by
his banker and possibly a few other
innocent but aggressive money lend­
ers. Give him the gate, and let him
know why you are doing it. Sure he
is going to do a little knocking, but
you will soon hear people accusing
you of being a conservative banker
and your deposits are very apt to take
on a steady gain.
Expense
Set up an expense book so that at
the end of the year you can tell at a
glance how much your coal cost, in
fact how much of the unnecessary
you have acquired and paid for. The
chances are you will be surpised at
the item of donations— if so, join your
Commercial club, if you have none, or­
ganize one, at any rate pass a resolu­
tion that all donations from the busi­
ness firms must be referred to the
president of the club, and then elect
a Scotchman for president. The item
of advertising may floor you— Listen
— when some good customer really
raises an exceptionally good crop of
(Continued on Page 32)

7

Tooting Our Own Horn
through
“ Farm Fence Filosophy”
< ‘ E1 ARM FENCE F IL O S O P H Y "
1 is the title of a very interesting
mimeographed bulletin gotten out for
the benefit of its customers, by the
Farmers and Merchants Bank of Mil­
ligan, Nebraska. A reproduction of
the bulletin heading appears on this
page.
C. Smrha, president of the bank, is
the author of the bulletins, all of which
are written in simple style, with es­
pecial appeal for the average reader.
Occasionally a bulletin contains a bit
of poetry, as exemplified by the fol­
lowing paragraph from one of the edi­
tions : (It is on the subject of “ These
darn banks").
“ About the bummest thing we’ve
got, which pesters me and nothing but
-— is these darn banks. I ’ve come to
feel, they’re osified and cold as steel.
I ’d like to run one up-to-date and
show ’em how to operate! When I
ask ’em for a loan, they look as cheer­
ful as a stone. They don’t even crack
a smile and ask me to sit down a
while. What the heck are they here
for?
To pile up money more and
more?
I ’d put it into circulation
where it’ll get some ventilation and
the eagle on the dollar’ll get a chance
to scream and holler. The way the
bankers run their dumps just stamps
them as a lot of chumps. The fel­
lows they loan money to don’t need

it like I sometimes do, yet they won’t
loan me on, a bet no matter how hard
up I get. I ’m payin’ interest now, you
know, on loans I made six years ago.
The same thing with their check ac­
counts. I ’ve had sums in various
amounts to my credit at the bank, but
d’you suppose that darned old crank
would scold me on account of it and
insist I cut it down a bit? Not on
your tin-type, brother, he watched my
’count with fiendish glee. But now
that it has shrunk in size, I think all
night in bed he lies thinkin’ up mean
things to say ’cause my ’count’s the
other way. When I overdraw a bit,
he has a wild conniption fit. About
the easiest job there is is surely this
here banking biz. While you are
asleep at night, interest piles up left
and right. All you need to do to win
is keep money rollin’ in. If I had
money to my name, I ’d start a bank or
bust a hame.”
“ There’s a Sucker Born Every
Minute” is the subject for a brief edi­
torial in another one of Mr. Smrha’s
bulletins and it reads as follow s:
“ In discussing the Blue-sky law this
winter, Senator Banning offered an
amendment that across every certifi­
cate there be printed in bold face type,
“ There’s a Sucker Born Every Min­
ute.” Communities have been cursed
with the sale of various kinds of se­

curities which proved to be worthless.
Thousands of dollars have been taken
from the pockets of hard working
people by smooth-tongued, unscrupu­
lous salesmen who gained the confi­
dence of the people and then held
them up like a highwayman. Our
community has never suffered very
much from this class of thieves and
we take some of the credit to oursel­
ves for warning our people against
this class of sharks and keeping them
out of the community. What little
money was lost through this channel
might have been saved if our advice
had been followed.”
Another bulletin deals with Christ­
mas time, and attempts to get across
a bit of a bouquet to the banker. It
reads:
“ Christmas is here once again:
Peace on earth, good will towards
men.
Everybody’s feelin’ fine,
Even the cross porcupine
Softens up his bristles some
Hopin’ Santa Claus will come.
It’s the one time in the year
When you come mighty durn near
Chucking all your faults and sins
And startin’ new when the year be­
gins.
A soft like feelin’ comes a creepin’
Like a revival meetin’
Leaves you meek and mellow like

The cartoon heading of the “ Farm Fence Filosophy” bulletins that are published for its customers by the
Farmers and Merchants Bank o f Milligan, Nebraska.


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Federal Reserve Bank of St. Louis

Central Western Banker, July, 1928

8
Lovin’ every blessed sould in sight.
My heart seems to sort o ’ hanker
To love even my old banker.
When the goose was Ilyin’ high
I asked him for a loan to buy
My neighbor’s farm, as good as gold,
But he turned me down mighty cold.
I ’lowed it was a dirty trick,
It just purt near made me sick.
I swore I’d do my banking where
They didn’t growl like an old bear.
But things soon took a different turn
And now I just don’t give a durn.
It sure would o ’ been an awful poke
Because it would have left me broke.
X’ve had more service from my bank,
To tell the truth and be right frank,
By being kindly shown the door
And not getting what I asked for
And turning me down rather curt,
Not caring if my pride was hurt.
If they had let me have my way
And took in what I had to say
Instead of being in the clover
I ’d be in debt till hell froze over.
To love my banker I ’ve got cause
For he’s sure been my Santa Claus.”

“ I ’ll Do My Banking At the Bank
That’s Square” is the theme of still
another “ Farm Fence Filosophy” bul­
letin, and it appears in rhyme as fol­
lows :
“ Some folks can’t see that it’s pure
graft
To write checks till they overdraft.
Why, if a banker failed to pay
A check I drew to pay for hay
Because the funds were all drawn out
By overdrafting each account
I ’d sure get warm under the collar
And be right apt to make a holler.
I want my bank to pay my check
From funds that I ’ve got there, by
heck.
I want no guys using my money
To pay his bills or bet on Tunny.
And that’s just what they do, by Jake,
When an overdraft they make.
Like lots of folks I have the hint
My check book was a government
mint
And all I had to do was just
Fill her out and let her bust.
When my funds had petered out

The bank just used the rural route
To ask me please to hurry up
And come in to fix it up.
And it was up to Hank and me
To settle our difficulty.
Mr. Banker said to m e:
‘It’s just like this, Jim, you see,
W e can’t pay checks which you write
When you have no funds in sight.
W e would have to pay it out
From some other guy’s account.
A check ain’t worth a cent until
The bank has your funds in the till.
No one’s going to get from us,
Let him swear at us and cuss,
Money that just you alone
Have a right to call your own.
On the other hand, I ’ll say,
This rule works the other way.
You can’t have a bloomin’ sou
Unless the funds belong to you.”
The more I thought about this thing
The more and more I liked it’s ring
And came to the conclusion that
I want to do my banking at
The bank that’s square in all its biz
And each one gets just what is his.”

“ A m erican Business Is M oral”
American business has achieved
new standards of morality under com­
petitive conditions which have brought
it about that “ only that business will
succeed which loads its products with
intrinsic social services,” J. H. Pue­
licher, President Marshall and Ilsley
Bank, Milwaukee, Wis., and chairman
of Board. American Bankers Asso­
ciation Educational Foundation told
the Civic Development Group meeting
of the sixteenth annual convention of
the Chamber of Commerce of the
United States.
He also told the conference why
many business leaders who seek to
repay America for their opportunities
and success through rounding out
their careers with a period of some
form of eminent public or political
service, fail to realize their aim. He
recommended that while men are
achieving business success in its lower
stages they also engage in public ser­
vices in minor capacities, so that when
they reach the top in business they will
also be trained and fitted to render
service at the top in public life. Mr.
Puelicher said in part:
“ America in the last two decades
has achieved a rather outstanding
business morality. Business and ser­
vice have become almost synonymous.
There was a time when “ Charge what
the traffic will bear” was an accepted
business principle. Such principles
Central Western Banker, July, 1928


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Federal Reserve Bank of St. Louis

have become archaic. The manufac­
turer of things for sale, rather than
for use, is rapidly fading from the
picture.
“ W e sometimes speak of business
as consisting of an interchange of
goods and services, but after all busi-

©Stein

J. H.

P u e l ic h e r

ness consists of the interchange of
only one thing, and that is service. In
this view of it the goods become mere­
ly the vehicle of service. This is es­
pecially true under the methods in
which business in America is done to­
day. Let us consider a great manu­
facturer or distributor of a product.

What does he do? He not only obli­
gates himself to sell to his customers
an honestly constructed product— that
is, a product which will physically per­
form the services to the consumer
which he advertises that it will per­
form, but he also obligates himself—and especially has competition brought
this about— to supply this product to
the consumer at a price which will
represent only a fair profit to himself.
He also obligates himself, somewhat
as a public utility company is com­
pelled by law to do, to serve all con­
sumers equally and fairly without dis­
crimination, provided they are able to
discharge their side of the transaction
or purchase. He also obligates him­
self to stand behind his product and if
any unforseen failures in its quality
develop to make them good in full to
his customer. He also obligates him­
self by the very fact that through his
advertising he creates first an appetite
and then a public need for his pro­
duct to be always in a position to sup­
ply the resulting demand for that pro­
duct.
“ All these things, which are prac­
tical competitive factors, are forms of
socialized service ,and only that busi­
ness will succeed today which loads its
products with the maximum of all
these forms of service. Advertising
— that is, the public profession of the
(Continued on Page 20)

9

W hy the Small Bank Should Pay
Little, if Any, Interest
A bank is fulfilling its service to customers when it furnishes them a
place to transact business, pass books, check books, competent officers,
and is willing to pay their checks up to the extent of their balances
pay our shareholders 10 per cent an­
ETOR many years I have been con­
By Geo. S. H ovey,
nually on our capital and surplus. So
vinced that the smaller banks
President, Interstate National Bank,
long as this policy prevailed, some
should pay very little, if any, interest
Kansas City, Missouri
eight or ten years, we continued to do
on deposits. If I am to leave with
so. Several years after I moved to
you any thought which I think it will
Kansas City, third banks were estab­
be well for you to consider very seri­ matured that we could hardly expect
them to leave their money with us lished in both Horton and Hiawatha
ously, it is my conclusion, based on
without interest and we promptly in­ and out of fear of losing deposits to
the experience of which I will tell you
formed them that they were correct in those institutions, and to my mind
somewhat in detail, that a bank is ful­
filling its duty to its depositors when their conclusion. W e told them that without due consideration, the older
banks again proceeded to pay interest
we considered these certificates as our
in furnishes a pleasant room in which
notes and they were forcing us to on deposits. Now our old bank at
to transact his business, pass books,
Horton is again in its
check books, competent
,111111111111111111111111111111111111111111111iIM1111111111111111111111111111111II111111111111111111111111111111111M111M11111111111111111111111111111111M11111111111111111111111111111111111111111111111111111111111111111111111111111111111|
old position of having
and obliging officers
something over 10 per
and tellers, and the
THE IDEAL SITUATION
cent of its total deposits
willingness and ability
“ It seems to me that perhaps the ideal banking situation in
in the form of certifi­
to pay his checks for
the average town with a population o f from five to ten thousand,
cates and now pays the
any amount up to the
woidd be two very substantial commercial banks paying no inter­
shareholders what is
extent of his balance,
est on deposits, a savings bank and a building and loan associa­
the equal of 6 per cent
on demand,
tion, both o f which in turn might be owned by shareholders of
dividend annually on
Many years ago it
the tu'o commercial banks.” — From address before Group 4, Ne­
invested capital. As
was my good fortune
braska Bankers Association.
you know, with few ex­
to meet at a Masonic
ceptions, only the timid
.............................. ..................................................................................... .............................. inim iiiim iiiiiim iiii.......................................... .......mm.......... ..................................
gath erin g, Mr. Lee
deposit their money in
Clark of the First Na­
the form of certificates for the reason
tional bank of Parsons, Kansas, who borrow their money on these certifi­
cates when we did not need it and
that they are afraid to make invest­
later became my immediate predeces­
frequently forced us to pay them
ments on their own account or judg­
sor in the bank with which I am now
ment.
Therefore,
the
certificate
connected. After talking with him and when it was least convenient for us
holder is the first one to take flight
with several other substantial bank­ to do so. W e said that we preferred
and to withdraw funds if a bank’s
ers whom I met, with respect to the to borrow money from our corres­
pondents when needed and be in a reputation is in any way brought into
desirability of paying no interest on
position to pay it off when not needed ; question.
deposits, I was thouroughly sold to
that we were not willing to pay inter­
I recall very well that in northeast­
the idea that our bank at Horton,
est on deposits but would be of every
Kansas, of which I was then cashier,
ern Kansas, the First National Bank
assistance to them in investing or
should cease paying interest on any
of Atchison of which David Auld at
loaning their funds; and that our o f­
form of deposits. When I went to
that time was president, paid no in­
fice, stationery and time were quite at
terest on deposits for many years and
the bank in 1888, it was paying 6 per
their disposal in that direction. Short­
the common expression with us when
cent on deposits if left twelve months
ly thereafter one of our most influen­ we wished to make a favorable com­
and 5 per cent if left three to six
tial and generally considered financi­
months. I proceeded to talk to the
parison, was that a certain bank was
ally responsible farmers who had bor­
cashier of our competing bank, Mr.
as good as David Auld’s. The result
rowed some of the money which had
Wilson, of the First National Bank of
was that in the panic of 1893 and on
been withdrawn and which had here­
Horton, and convinced him that the
similar occasions, money which had
tofore been deposited in the form of
idea I had gained in that direction was
been placed on deposit with banks
bank certificates, was unable to meet
sound. Together we visited the two
paying interest was withdrawn and
his obligations. The banks, being in placed with David Auld. The deposit­
banks in Hiawatha, Kansas, which is
closer touch with his financial condi­
the county seat of Brown County, and
ors had come to the conclusion that
tion, had collected their money and
because he paid no interest on depos­
after due consideration, they joined us
those who had sought to loan their
its, he had plenty of money and funds
in that conclusion. Thus the four
in his bank were safer than elsewhere.
banks simultaneously discontinued money on their own responsibility lost.
Whether or not it was on account of
the paying of interest on any form of
Closer Co-operation Needed
peculiar conditions at the time, I do
deposits.
1
would like to suggest for your
not know, but the result was that in­
consideration
the question o f closer
Ten Per Cent Dividends
stead of going down, our deposits in­
co-operation among bankers residing
O f course, those who had certifi­
creased and likewise our dividends.
in the same community and the forcates promptly informed us as they Very shortly thereafter we began to


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Federal Reserve Bank of St. Louis

dm

Central Western Banker, July, 1928

10
mation of county or community or­ tained by banks in the middle west in and, no doubt it has been brought to
the four years from 1922 to 1926.
your attention that the largest bank in
ganizations. I am happy to say that I
Suffice it to say that the amount is al­ the United States has an affiliation
have never failed to get on with my
competitors, and perhaps the most de­ most beyond belief. O f course, the which deals solely in what it is pleased
net result is that the money was taken to term “ compound interest deposits.”
lightful business experience I have
had since going to Kansas City is in from those who had and given to those It has also recently established a de­
the fact that the bank at Horton which wlw had not and in that respect, it may partment for handling small loans
be said that our banking system as it such as I infer go many times to what
was my competitor for thriteen years
now exists and our banks as they are are termed the “ loan sharks.” This
placed its account with The InterState National Bank in Kansas City now operated are really great equaliz­ in addiiton to bond departments and
ers and distributors of assets in com­ well organized credit departments
almost immediately on my becoming
maintained not only for the bank’s
connected with that bank. It has re­ munities where banks have failed. For
mained there ever since, notwithstand­ not only have such banks distributed individual use but for its customers as
ing the fact that I control its com­ their capital and surplus to their bor­ well.
rowers but also in many instances all
It seems to me that perhaps the ideal
petitor and have for all of these years.
or a greater portion of the deposits re­ banking situation in the average town
I feel that a false pride sometimes
ceived from those who were frugal
with a population of from 5,000 to
keeps us from going to our neighbor
and successful have been given to
10,000 people would be two very sub­
for credit information or if we hear
those who were unfortunate or un­ stantial commercial banks paying no
he has said something unpleasant
interest on deposits, a savings bank,
about us instead of sitting at his desk successful.
and a building and loan association,
I presume you are acquainted with
and going over the matter with him in
the fact that banks in the larger cities
both of which in turn might be owned
every detail. For in nine cases out of
are more and more becoming what by the shareholders of the two com­
ten, it develops either that he did not
mercial banks.
say the unpleasant or untrue thing re­ might be termed “ departmental banks”
ported to us or if he did, he had
heard something which someone else
had said which was untrue or incor­
rect.
I believe that entirely worthy of the
consideration of the banks in a coun­
ty or community is the plan of em­
ploying an examiner under the con­
trol of a representative committee who
would devote all of his time to weed­
ing out the borrowers who are using
two or more banks to their disadvant­
age and to suggesting improvements
in methods, etc., and to keeping gen­
erally in touch with the credit situa­
tion as it affects the banks in his coun­
ty or community. For eighteen years
I have been a member of the Clearing
House Committee in Kansas City.
As you probably know, the statements
of all the member banks in Kansas
City are brought to the attention of
the Committee by our Clearing House
Examiner for such consideration, com­
ments and advice as they may care to
make to the chief officer of the bank,
The electric milking machine in use on the George Welsh farm south-east
who appears before the Committee
of Seward, Nebraska. This machine cost Mr. Welsh slightly less than
when his report is being considered.
$1.00 per month over a two-year period, milking on an average of 18 cotvs
In all of these years, I have yet to
the year around.
learn of a single instance where in­
formation thus obtained by a member 'TVHE practicality of farmers equipment uses may be definitely deter­
of the Committee was used to the dis­
A ping their places with various mined. This information should be
advantage of any of the member
electrical appliances is being deter­
of considerable value to the farmer
banks. You might say the expense of
mined by the Nebraska Committee on
contemplating investing money in
such an examiner would be too great
Rural Electrification, under the im­ electrical equipment.
for you to pay, but I think that if
mediate supervision of Professor E.
Running water in the house pumped
you will ascertain the losses made
E. Brackett, of the agricultural engi­ by an electric pump costs about 40c
which might have been averted by
neering department at the University
a month.
such an examiner, you will conclude
of Nebraska.
An electric range costs about $6.50
that the expense would bear no very
E. B. Lewis, who is directly in
per
month. (This price is taken from
great relation thereto.
charge of the installation and care of
Certainly the borrower, as well as the machinery, puts in the lines, in­ a four cent rate).
A sewing machine costs about one
the lender, would be better off if
stalls the equipment, and attaches a
quarter of a cent an hour.
loans were made only on an absolute­ meter to each different appliance.
ly sound basis. I would be afraid to With a measuring stick at every switch
A vacuum cleaner costs about one
estimate the amount of losses susthe exact amount of juice each instru- and one-half cents per hour.

Will Experim ent With
Electric Appliances

Central Western Banker, July, 1928


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Federal Reserve Bank of St. Louis

11

S T O P and G O
by the
Clearing House Plan!

them worse, so the im­
C T U D E N T S of bankprovement is attempted
^ ing have generally
by people outside of the
agreed upon a few fun­
banking business, who
damentals in the way of
know very little about it,
legal machinery that is
and sometimes these al­
necessary in the success­
leged improvements be­
ful conduct of the busi­
come a menace to the
ness of banking. Two of
prosperity of the coun­
these requirements are
try.
ou tsta n d in g. For ex­
The supervision of
ample, they are agreed Excerpts from an address on the “ Regional Clearing House” by Dan
V. Stephens, Fremont, Nebraska, before the Ohio, Georgia, Virginia banks, before the crea­
that, since the business
tion of the Clearing­
and Wisconsin State Bankers Associations
of banking is a quasi­
house, was exercised en­
public business, it is es­
tirely,
of course, by
sential to the public wel­
the state and the nation. The idea
fare that the authority to engage in
of self-examination of banks is only
this business should be limited to
a recent one, comparatively speaking,
the number of banks necessary to do
and has taken form in the shape of
the business for any given community
Clearing House Associations in some­
and that the character and ability of
thing like 35 American cities. There
those authorized to engage in the busi­
are some 500 or more Clearing House
ness be beyond question. The sec­
Associations in the country but only
ond essential principle involved in
35 have reached the point where they
successful banking is the supervision
feel that the state and national ex­
and examination of the banks after
aminations are not adequate and have
they have been constituted. If these
established special examiners for
two principles can be applied to the
themselves. This is a forward step
business by an intelligent authority,
and shows that the bankers in these
the difficulties in the way of success­
cities at least are not deceiving them­
ful banking can be easily removed.
selves as to the necessary practices if
The people are not concerned so
their banks are not to be kept uni­
much about the corner grocery store.
formly solvent.
It can come and go as the result of
No Depositor Suffered
the law of the survival of the fittest,
In this self-examination of banks,
but not so with the bank. A solvent
as exampled in Clearing House cities
bank is vital to the peace and pros­
such as Chicago, no depositor has lost
perity of the people. It must be as
a dollar in a Clearing House bank in
dependable as the post office and the
the last quarter of a century. This
government itself. It cannot be sub­
record is most complimentary and
jected to ruthless competition for the
leads us to the conclusion that the
plain reason that failure spells disas­
DAM V . ST E P H E N S
Regional Clearing House Association,
ter to its, patrons and a great disturb­
if it did nothing else than to pattern
ance to the general welfare.
the capital and keep the banks clean
the Chicago plan, would be a step for­
and therefore solvent. The condi­
Violated Two Fundamentals
ward but the Regional Clearing House
tion throughout many states of the
Perhaps I should have prefaced my
plan,
as now proposed by the Nebraska
union,
where
there
has
been
a
bank
remarks with the statement that dur­
organization, is a brand new applica­
for every 1,200 or 1,500 people, caus­
ing the last seven years fully 10% of
tion of the Clearing house principles,
the banking institutions of the coun­ ing fierce competition and encourag­
which makes it adaptable to all the
ing practices that are not safe and
try have failed and they have failed
states of the union and its realization
sane, has brought about practically
primarily because of the violation of
a reasonable possibility.
the two fundamental principles laid all of the bank failures about which
The Nebraska plan contemplates the
we now complain.
down as essential to the successful
use of the regular state and national
W e have undertaken to answer that
conduct of the business. There would
examiners, which should be adequate
have been practically no failures had question in Nebraska by taking what
and which should obtain exactly the
we believe is a preliminary step in the
the number of banks been restricted
same results as a special examiner, if
to the needs of the people and had solution of the problem by organizing
the
same principle and conditions are
the First Nebraska Regional Clearing
those institutions been adequately and
applied to their work.
properly supervised. Therefore, we House Association. The theory upon
By the use of the state and nation­
know what the causes of bank fail­ which we are operating is this. W e
al examiners and by the application of
have tried many sorts of legislation
ures are and we think we know ex­
this principle by the state and national
actly what is necessary to prevent looking to the perfection of the bank­
banking
departments, the system can
ing
system
but,
as
a
rule,
the
bankers
them.
The condition that exists today themselves have had little or nothing be made uniform throughout the
United States without any additional
throughout most of the states prove to do with the experiments that have
legislation. All that is required, in
that we have too many banks with been tried. Generally speaking, bank­
fact, is the change of the viewpoint
ers refuse to take any forward step to
correspondingly small profits, which
of the various Banking Commissionimprove conditions lest they make
are not adequate to pay a return on


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Federal Reserve Bank of St. Louis

Ccntral Western Banker, July, 1928

12
ers and the Comptroller of the Cur­
rency. If they can be convinced of
the soundness of the proposal, the
whole scheme can be put in operation
without any great difficulty or loss of
time.
Why is the special examiner in the
Chicago Clearing House Association
more effective than the regular legal­
ly constituted examiner? The ans­
wer is simple. He is more effective
because he is allotted to a specific ter­
ritory and assigned a specific duty of
examining a certain group of banks
and he is made responsible to the
Clearing House Association for the
result of his work. In other words,
the special examiner becomes a per­
manent personage of importance in a
community and is charged with a great
responsibility by the Clearing House
Association. The result of this is to
magnify, if anything, the importance
of his work in his own mind and, at
the same time, the permenancy of his
employment enables him to become ex­
traordinarily proficient through the
knowledge that he gleans of the busi­
ness of the community; the character
of the risks that the banks assume
and the nature of the securities that
they carry. Therefore, if we are cor­
rect in assuming that the permanency
of the position of the examiner on a
specific location brings these results,
then why does not the state and na­
tion apply this same principle in the
conduct of the business of examining
and supervising banks?
It Can Be Done
If the state will locate each of its
examiners in a special territory as­
signed to him with a view of having
him supported by a voluntary Clear­
ing House Association, why could not
the same results be obtained through
the regular official channels that are
now being obtained by the 35 cities
that have special examiners through
local Clearing House Associations?
W e see no reason whatever why this
cannot be done and it has a very dis­
tinctive advantage, it seems to me,
over the present Chicago Clearing
House Association, for country dis­
tricts, in that:
First, it saves a duplication of ex­
pense of employing special examiners;
making the plan easy to adopt by
states ;
Second, it becomes absolutely uni­
form throughout a state taking in all
banks, both good and bad, as con­
trasted with the city Clearing House
plan which takes in only such banks
that can qualify. The Nebraska plan
takes them as they are, hoping to make
them better.
Third, it has the advantage over a
Central Western Banker, July, 1928


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Federal Reserve Bank of St. Louis

THANK YOU, MR. HOGAN!
“ The second issue of the C e n t ­
W estern B a n k e r of Oma­
ha has reached my desk and I
have read it with a great deal of
interest. H ere’s hoping this new
addition to your already high-class
group of hanking journals will be
just as good as the others. A p ­
parently you are keeping up the
high standards set originally in
the Northwestern Banker. 1 am
looking forward with pleasure to
reading the succeeding issues of
the C e n t r a l W estern B a n k e r / '
J. H. Hogan, vice-president,
Continental National Bank and
Trust Company, Chicago.
ral

................................. ..................ilium...................................................

Clearing House Association such as
Chicago, in that it escapes responsi­
bility for failures as the examinations
are in legal hands, yet it uses all its
powers to prevent failures, and im­
prove practices. The Association be­
comes effective without being weak­
ened with the blame for its imperfec­
tions as would be the case if it were
patterned after the Chicago plan.
Fourth, the results of the Chicago
plan can be gradually approached
ithrofigh regular, legal
channels
through the Nebraska plan and made
uniformly available whereas the Chi­
cago plan never could be adopted to
the country as a whole.
This, I think, is a fair outline of the
principle involved in the application
of this brand new idea of Regional
Clearing House Associations.
The state examiner assigned to our
60 banks is doing his work thorough­
ly; is very enthusiastic over it and has
a sense of responsibility that has not
heretofore characterized state bank
examiners. The Association furnish­
es him an office and has furnished it
with such help as he may need for
preparation of his Credit Bureau.
The Clearing House Association has
its regular quarterly round table meet­
ings devoted to the study of better
banking practices and, in addition
thereto, the directors meet monthly, or
as often as is necessary, to consider
the problems that come within its
jurisdiction.
What It Has Done
The Clearing House Association
has recently terminated a very vigor­
ous campaign, which was statewide,
against a certain policy in practice
that had a tendency to stimulate the
granting of additional charters for
new banks conditioned upon the sale

of assets of banks that were being
liquidated. The result of this policy
was very detrimental to the best in­
terests of the state and it took a state­
wide campaign to change it but this
Clearing House Association succeeded
in changing the policy and thereby
rendered a most effective service to the
state as well as to the banks. This
policy would not have been changed
without this effort on our part.
The Association also has dealt with
three bank failures within its boun­
daries since it was organized last Sep­
tember and has succeeded in rendering
most effective service that is not only
recognized by the State Banking De­
partment, but by the bankers them­
selves.
In one case the Association succeed­
ed in having the losses cleared out of
a bank, that had been closed, and the
bank re-opened, which saved to the
creditors of the bank at least $100,000
and prevented the liquidation of the
bank, which would have been a great
disaster to the community, where it
was located, and have a corresponding
loss of public confidence.
It has adopted as its slogan that
there should be no more banks char­
tered where the needs of the commun­
ity do not require them and upon that
proposition it will conduct a most
vigorous campaign of protest which in
two cases has proved most effective.
In fact, we have established this pol­
icy so thoroughly that we apprehend
that the burden of getting a charter
will be so great that few will under­
take it in the future unless a new
bank is actually needed.
Therefore, as a result of the ex­
perience so far cleaned by the First
Nebraska Regional Clearing House
Association, we can state:
hirst, that it has justified its exist­
ence many times over by crystallizing
public opinion as well as banking opin­
ion along lines of safe and sane bank­
ing methods, and,
Second, this Association has great­
ly improved the banking practices of
its members through our quarterly
round table meetings, which has en­
abled them to work in harmony in
stabilizing interest rates and in pro­
tecting the public against unfair prac­
tices to an extent that they have never
heretofore been able to do.
Since the experiment has been under
way thousands of bankers throughout
the United States have been watching
it with interest and consider it with
a view of urging its adoption in other
states. Many states are taking it up
and many Commissioners of State
Banking Departments are now con­
sidering plans for its adoption on a
state-wide scale.

13

Putting Banking on Sounder Basis
I O O K IN G back eight years ago it
is wonderful to think that the big
majority of our banks weathered the
storms and lived to tell the tale, and
are here today, on the eve of a new
prosperity, to take full advantage of
better times. With the experiences
we have all gone thru in the last eight
years, we are better bankers. W e are
running better banks. W e realize the
fact that we must run our banks on
a good sound business basis, in good
times as well as poor, if we are to
continue in business and get our share
of prosperity.
Tt is really a wonder that the banks
in Group Six got through as well as
they did. When they were loaning
their money on $80.00 steers and when
this value was more than cut in two
almost over night, I think it speaks
a good deal for the ability, resource­
fulness and “ stick-to-it-iveness” of
our bankers. And while we are prais­
ing ourselves, let us not forget the
great help extended to us in time of
need by our correspondent bankers,
especially the Omaha and Lincoln
bankers. Without their help and ad­
vice, we doubt very much if many of
our banks would have made the grade.
Passing the Buck
W e are somewhat prone to pass the
buck of deflation to the Federal re­
serve System. It is human nature that
in times like those of eight years ago,
that we should blame everybody but
ourselves for the deplorable state of
affairs. However, in the light of his­
tory it seems more clear to us that
the Federal Reserve System was not
to blame for deflation, and instead of
being criticised, the System should be
praised for the way it handled affairs
at that time. The strength of the
Federal Reserve System really saved
the whole financial structure of the
nation, and without it things would
have been a thousand times worse. It
has in late years kept down an un­
healthy inflation . By raising and
lowering the dicsount rate, it is able
to keep things moving on an even

By C. F. Coffee,
Chadron, Nebraska
(From Address Before Group 6 Bankers)

keel. There are a good many things
that the member banks would like to
change— such as collecting a little in­
terest on their reserve accounts. But
taking it all in all we should appreciate
the fact that we have a banking system
that has proven to be the most suc­
cessful ever devised by man.
Another thing to remember is the
fact that the bankers of Group Six
were probably hit by the deflation of
cattle and sheep prices to a greater ex­
tent than any other group of bankers
in the state.
And in line with that I will make
the statement, that with the improve­
ment in cattle, sheep and agricultural
prices, no other group in the state of
Nebraska has come back faster or is
sitting on as solid a foundation as the
banks of our group.
This year of 1928, we as bankers of
Group Six, have a great deal to be
thankful for. O f course, there are as
yet many frozen assets to thaw and
liquidate, but the time will come, and
come soon, when we will be able to
turn over our real estate and clean up
old indebtedness.
Real estate in Group Six was never
pyramided, in excess of real value, to
tbe extend that is was in other parts
of Nebraska and in Iowa. Our land
is still worth the price. Considering
what our land will produce per acre,
it is priced at the greatest bargain
figure of any land in the United
States. W e know what we have out
here and the people in the east also
know it, and, I predict that as soon as
the farmers back there can sell out and
come west with a little money, they
will be here. They will get their
money’s worth, and will live to be
thankful that they had the opportunity
of buying western Nebraska land at
bargain prices. You will never see
land in our group as cheap as right
now. It is going up.

At this time I think we should con­
gratulate the Publicity Committee of
the Nebraska Bankers Association,
under the able leadership of its chair­
man, C. J. Claassen, upon its good
work during the last year along the
line of advertising our agricultural
resources.
No More Banks Needed
As to the banking situation in our
group, we do not need an y more
banks. What we need is to build our
institutions into stronger banks. W e
want to run banks, not real estate o f­
fices. W e still need some consolida­
tions and weeding out.
As a good big surplus fund is the
best guarantee of a bank’s solvency,
we hope to see the day when the State
of Nebraska will cease taxing Bank
Surplus Funds, and thereby encour­
age the building of adequate reserves
for the safety of the bank and its de­
positors and not as at present, levying
a tax on a bank’s surplus account as
well as its capital that makes it al­
most prohibitive.
Touching on the Nebraska Guar­
anty Fund law, I will say that the plan
proposed by A. L. Shantz of the State
Bank of Omaha, seems to be the most
reasonable solution of the problem.
At the last meeting of the Execu­
tive Council of the Nebraska Bankers
Association, the matter of the asso­
ciation offering a reward of $5,000.00
for each dead bank robber killed in
the act or trying to escape, was
brought up. As you know it was
voted to make this offer, provided
that 700 banks of the Association
signed up as willing to participate. I
believe this would be a good move. I
see no reason why the banks should
not make this offer in order to pro­
tect themselves. It would only cost
the individual bank a very small sum
in case of a killing, and if a reward
of this kind would give our officers of
the law an incentive to go after a
bank robber and shoot him full of
holes, I believe we would soon see
the disappearance of bank hold-ups in
Nebraska.

The Handling of P ower
VY/- H ILE crime and degeneracy are
creating a dangerous situation in
America, “ The more serious problems come not from the weak, but
from the strong,” Dr. Harry Emerson
Fosdick of New York told the Ex-


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ecutive Council of the American
Bankers Association recently. He
declared that “ there are men of ability who rise to the top in American
industry, where only the ablest can
come through, and it is men like this

who, dishonoring the courts, despis­
ing the people, condemning the gov­
ernment, have presented to the world
one of the most devastating spectacles
of public wrong-doing in the history
of government.” He spoke before the
Central Western Banker, July, 1928

14
annual family dinner of the council
attended by over 300 bankers and
their guests.
Dr. Fosdick said in part, “ The
central problem of America today is
the handling of power. American
prosperity has many sources all the
way from the original opulence of the
continent to the conveyor system of
manufacture. But, however variously
caused, it is here, and it constitutes
the crux of our national and industri­
al situation.
“ Prosperity is not commonly re­
garded as a problem, but it is. It can­
not simply be enjoyed; is must be
handled. Power is always dangerous
to its possessor, and all the greatest

tragedies of human history have come
from misused prosperity.
Another Aspect
“ Without in the least denying the
peril in which we stand from this disgenic tendency that multiplies the
feeble, there is another aspect of the
truth more pertinent to ourselves.
The great disasters of history have
not been caused by the weak. They
have been caused by the misuse of
power on the part of the strong. Page
Pharaoh, page Nebuchadnezzar and
Sennacherib, page Nero and Napo­
leon ! Or consider our own country
today. W e do face a dangerous sit­
uation in regard to the crime that

Investors Should Know
TH A T THE BUSINESS OF LIGHT
AND POWER, GAS, W ATER, AND
TELEPHONE

COMPANIES

DOES

NOT LEND ITSELF TO LOSSES

T H A T DEFAULTS IN THE BONDS
OF SUCH ARE ALM OST UN­
KNOWN.
THE

PURCHASER

OF

U TILITY

BONDS DOES NOT W O RRY ABOUT
HIS SECURITY.
Ask For Our List

SMITH, LANDERYOU & CO.
640 First National Bank Building
OMAHA, NEBRASKA
Telephone JA ckson 5065

Central Western Banker, July, 1928

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comes up out of the slums of great
cities and expresses itself in gangs of
youths, often degenerate, feeble-mind­
ed, committing murder for two dol­
lars, and spending their lives inter­
mittently in asylums and jails.
“ The republic, however, will not
ultimately go to pieces on that. There
are men, not feeble-minded, men of
ability who rise to the top in Ameri­
can industry, where at the top the
competition is terrific so that only the
ablest can come through, and it is men
like this who, in these last few years,
dishonoring the courts, despising the
people, contemning the government,
have presented to the world one of
the most devastating spectacles of
public wrong-doing in the history of
government. Always the more ser­
ious problems in a nation like ours
come, not from the weak, but, from
the strong.
“ Anyone who have traveled widely
across the world must have recog­
nized the fact that there are two
kinds of trouble on earth; one whose
major root is destitution and weak­
ness, and the other whose major root
is misused wealth and power. Go to
Arabia, for example, and you will
see the first kind. The background of
Abrabian life is destitution. I have
seen chattel slaves in the tents of the
Adwan Arabs who gladly have sur­
rendered themselves to slavery and
counted it a godsend because at least
it enabled them to keep soul and body
together. So, the major problem
of China is lack — lack of food
so that millions are starving all the
time, lack of literacy so that hardly
five per cent of the Chineses can
either read or write, lack of com­
munication so that there are hardly
enough railroads in all that immense
country to supply a good-sized city
in the United States. The basic pro­
blem of China is a problem of lack.
But our problem is not all destitution,
it is the possession of tremendous
power. Our difficuty is not feeble­
ness but selfishly directed energy. W e
are not a river that has run d ry ; we
are a river at flood that is likely to
go mad.
“ This is a dangerous situation but
it is also hopeful. For the finest
thing in the world is rightly used
power. Whether or not America can
achieve that goal is the crux of her
national problem. To achieve this
goal there are at least three things
necessary; in personal character, a
new emphasis on self discipline and
self-control; in industry, the build­
ing up of professional ideals of pub­
lic service; and in the nation at large,
the creation of a new sense of pat­
riotic national responsibility.”

15

Facts and Fallacies
A bou t Foreign Investments
By H enry R. H ayes ,
President, Investment Bankers Association
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“M AY BE INJURIOUS”
“ I do not wish to seem to oppose any honest criticism of
foreign or domestic financing that is based on able study of facts.
On the contrary 1 zvelcome such sturdy criticism. My objection
is that often much public opinion is based on the haziest of
casual information and on misconceptions that, when translated
into regulatory measures of a democratic government, may be
quite injurious to the entire community.”

n r HE field of international finance, as
in our own domestic
financing, affords the
American investment
banker the opportunity
.
and also the responsi­
bility of performing his highest func­
tion in directing the flow of capital.
This function was well described
more than a century and a half ago
by the father of political economy,
Adam Smith, in his Wealth of Na­
tions, when he wrote, “ The wealth of
the world as a whole benefits when
capital flows to those quarters where
it is most needed,” and with his native
caution he added, “ provided it is not
used for purposes of waste and de­
struction.”
At no times in all the history of in­
ternational finance has this last men­
tioned condition been better fulfilled.
While many of the international loans
in the pre-war period were perhaps
applied to the preparation or the con­
duct of war, the post-war loans made
by American bankers predominately
represent credit, not as Adam Smith
warned, “ for the purposes of waste
and destruction,” but rather for
strictly productive ends.
Has Stabilized Currencies
Our capital has helped to stabilize
the currencies of the various Europe­
an countries and has enabled them to
restore economic order so essential to
their happiness and our own contin­
ued prosperity. A survey of the pur­
poses of the loans listed on the New
York Stock Exchange demonstrates
that our foreign dollar loans now out­
standing are constructive in their pur­
poses. One of the most important rea­


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II

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HKIIIlllllllll

Ill

H en r y R. H ayes

sons why loans have been productive
rather than wasteful or destructive,
has been the non-political nature of
American finance. It has been in­
fluenced not by political but by eco­
nomic motives in directing the flow of
our money abroad. In the case of this
country, finance has not been the
handmaiden of international politics.
In no other country has the relation

between g overn m en t
and finance been so im­
partial. As a result
American bankers have
been able to offer for­
eign loans which rest
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I
on the sound base of
economic worth and not upon the
doubtful platform of political expedi­
ency.
The fear is frequently expressed
that our capital is being sent abroad
for the benefit of our competitors. Un­
questionably when a loan is granted
to a foreign company and the pro­
ceeds are used to sell goods in a for­
eign market or even in our own mar­
ket in competition with an American
company engaged in the same line of
business, the latter concern is directly
injured. But such cases are rare. In
fact, the trend of American foreign
investment is toward countries which
are complementary rather than com­
petitive to the United States. In the
future Europe will borrow of us rela­
tively less than South America. The
capital which we lend will be used
primarily, therefore, to provide broad­
er markets for our manufactured
goods. Thus the argument of the
competitive force of our foreign in­
vestment does not apply to South
America. In fact, if sound economic
reasoning be followed the argument
does not even hold good for Europe,
because the old continent is more a
customer than a competitor. Even a
cursory examination of our exports
will confirm that statement. In gen­
eral the relation of foreign investment
to foreign trade has always been
close. The economic history of Eng­
land shows the two movements closely
Central Western Banker, July, 1928

16
correlated. In the same way the for­
eign trade of the United States has
moved directly with the upward and
downward trend in our foreign in­
vestment ever since the close of the
war. To any one who applies the
simplest form of economic reasoning,
the cause-and-effect relationship of
these forces is apparent.
Is Not Harmful
It is frequently held that whenever
our bankers send capital abroad there
is so much less to go around for
American economic needs. It is
argued that worthy undertakings at
home have been held back because of
lack of capital. Such a statement as­
sumes that the American banker,
dazzled by the glamour of internation­
al business, prefers to make loans
abroad rather than at home. In the
last analysis the banker knows full
well that his customers prefer to keep
their money at home than to place it
abroad, and so he offers foreign in­
vestments only when he cannot supply
sufficient domestic securities. In other
words, foreign demands for funds are
met only after legitimate domestic
needs have been satisfied. If the
writers critical of foreign investment
can produce any domestic investment
which meets the tests of safety and
gives assurance of profit, there are
numerous American bankers who will
offer commissions large enough to en­
able them to withdraw for a long time
from the uncertain career of produc­
ing economic literature. Bankers, like
all other persons, are only too eager
to follow the line of least resistance
and would sooner confine their ope­

rations to the home field than to go
abroad where the effort involved may
be more laborious and expensive.
It is also argued that foreign in­
vestment by diminishing the capital
supply adversely affects labor. Such
reasoning loses sight of the fact that
at a time when there is idle labor
there is also idle capital, and unem­
ployment exists when interest rates are
low rather than when they are high.
The reason for this relationship is clue
to the fact that unemployment is the
result of a maladjustment between the
demand and the supply of goods and
not of a shortage of capital.
1 do not wish to seem to oppose any
honest criticism of foreign or domes­
tic financing that is based on able study
of facts. On the contrary I welcome
such sturdy criticism. My objection is
that often much public opinion is
based on the haziest of casual infor­
mation and on misconceptions that,
when translated into regulatory meas­
ures of a democratic government, may
be quite injurious to the entire com­
munity. The whole, simple, essential
function of any justification for the
investment banker is that he finance
sound, worthy business or governmen­
tal enterprise in a way that will give
to that enterprise every legitimate op­
portunity to succeed, that sound fi­
nancing can give, and at the same time
give every legitimate safeguard to the
investor’s interests.
RECORD VOLUME
The record volume of foreign se­
curities offered in the American mar­
ket last year was absorbed at the low­

A Sound, Diversified list of Bonds,
and Sincere, Experienced
Investment Counsel

R ufus E. L ee & C ompany
Investment Bankers
204-210 City National Bank Building

Omaha
Central Western Banker, July, 1928

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est interest rate in years for this type
of investment, according to Frazier,
Jelke & Co.
In 1926, it is pointed out, the nomi­
nal value of foreign securities was ap­
proximately $1,320,000,000 and the
average rate of return was 6.17 per
cent.
On the other hand, the value of
foreign government and corporate
loans in 1927 totalled approximately
$1,600,000,000 while the average rate
of return was 5.77 per cent.
Although there was an increase of
$275,000,000 or 20.8 per cent in the
volume of foreign offerings compared
with the year before, the yield on
these securities last year increased
only $10,540,000 or 13 per cent.
" 1he fact that such a large volume
of American capital was attracted to
foreign investment fields last year
when the indicated yield was lower
than it has been in the past, can be
accounted for in the main by the tre­
mendous expansion of security deal­
ings which took place last year and
by the surplus of funds seeking in­
vestment which was evident from the
generally low rates that money com­
manded during 1927,” it is stated.

When the Deposit is to Pay
Only an Outstanding Check
(Continued from Page 5)

of the check payable to the factory
agent.
The bank had no right to apply
same to any other purpose.
What the Law Says
As against the bank, the check given
to the factory agent became effective
when the deposit was made and the
bank was without authority to divert
the same by applying it in payment
of the demand note which it held
against Mazz. In other words, where
a bank, through its president, agrees
with a customer who is indebted to it
on a demand note, that, if he pur­
chases an automobile to sell in his
business to a prospective buyer and
issues his check on the bank therefeor,
the check will be paid, provided that
by the time such check is presented
the drawer shall deposit the proceeds
of the sale with the bank, and, in pur­
suance of such agreement, the cus­
tomer issues his check for the auto­
mobile, which he sells and deposits
the proceeds of the sale with the bank,
the holder of such check is entitled to
recover the amount thereof from the
bank, notwithstanding nothing was
said at the time of the deposit about
the application of the funds so de­
posited.

17

Comparing Stock and Bond
Prices
TF AN investor should decide to pur1 chase high grade bonds yielding four
per cent, and to buy enough of them
to give an annual income of 100 dol­
lars, he would have to get 2,500 dol­
lars worth of them. If he decided to

00

05

10


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Federal Reserve Bank of St. Louis

15

20

25

buy common stocks instead of bonds
he would find it possible to secure the
same income of 100 dollars a year by
investing distinctly less than 2,500 dol­
lars. When judged solely on an in­
come basis most of even the highest
grade investment stocks are never as
costly as high grade bonds, although
individual issues may at times sell at
such high prices as to yield even less
than the best bonds.
The diagram shows a comparison
of stock prices with bond prices when
both have been brought to the same
yield basis.
The bonds employed in
the comparison are the 15 high grade
rail bonds entering into the index of
the Standard Statistics Company. The
stock prices are computed from the
quotations of all the dividend paying
industrial common stocks regularly
dealt in on the New York Exchange
from 1900 up to 1925, and of 100
leading issues since that time.
The cost of the stocks that would
yield the same amount as the high
grade rail bonds has always been well
below that of the bonds. It has
fluctuated between 55 and 91 per cent

of the bond prices, and has averaged
about 72 per cent as much.
It has
always risen above 80 in the bull mar­
kets, and sometimes fallen to 60 in the
most severe of the bear markets.
Probably this sort of comparison
furnishes the best sort of a basis for
judging how high stock prices really
are. At present they are up to 91 per
cent of the bond prices. This is the
highest level ever reached. In 1902
they climbed to 87 per cent; in 1909
the got up to 80 per cent; and 10
years later, in 1919, they reached 87
per cent.
The high grade rail bonds represent
the almost riskless investment, with
the income assured, and the return of
the capital almost certain at the matu­
rity of the bonds.
The 100 stocks
represent widely varying degrees of
hazard, with the income fluctuating
and the possibility of getting back the
capital dependent on the widely chang­
ing swings of the market. Neverthe less, the stocks hold out the lure of
possible yield, and it is because of
this attractive possibility that the pre­
sent market has lifted stock prices to
levels never before touched.— From
Cleveland Trust Co. Bulletin.
Think much for yourself, not too
much about yourself.
The great need in the country to­
day is more stingy, careful men.

ANNOUNCE THE OPENING OF
THEIR NEW OFFICES AT

THE CLARKE-LEWIS BUILDING
318 South Nineteenth Street
OMAHA, NEBRASKA

JULY 30, 1928

Central Western Banker, July, 1928

18

Describes Advantages of
Fixed Trust
« t h e fundamental principle of the
A investment trust is the distribu­
tion of risk by the investment of funds
in securities or a great many enterpris­
es, investments in any one security
usually being limited to a fraction of
the capital,” says Lloyd W . Phillips,
investment banker of Fremont, Nebr.,
in a recent address before the Fre-

mont Rotary Club. Speaking of the
advantages of a fixed trust, Mr. Phil­
lips made the following points:
“ Dwelling for a moment on the
fixed type of investment trust. All
of these types are not by any means
created on the same basis. It is con­
tended by authorities that the very
nature of a Fixed Type of Invest-

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make a connection between Chicago

by more than 420,000 investors. It

and New York during the business

is constantly seeking to bring the

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nation’s telephone service nearer to

Each year the Bell System offers

perfection. It owns more than 93%

faster, more dependable service.

o f the combined common stocks o f

Basic facts on American Telephone
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the operating companies

With its predecessors, the American

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Çentrai Western Danker, July, 1928

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o f the

Bell System which furnishes an

New York City

ment Trust necessitates certain fun­
damentals which should lie incorpo­
rated in the Trust Agreement and
plan of operation if the trust share is
to be acceptable for the investment
need for which it is designed. And in
qualifying an Investment Trust with
these fundamentals there are five es­
sentials :
No. T—Long Duration of Trust.
This is necessary to avoid reinvest­
ment within the reasonable life time
of the purchaser or his heirs. A
trust running for a period of 20
to 30 years is contradictory because it
definitely will force reinvestment and
at a period when no forecast can be
made of the money market or the level
of the stock market. A trust as
nearly perpetual as the law will per­
mit is essential.
“ No. 2— No Power of Dissolution
by Promoters. Were this power pres­
ent and permenancy and long dura­
tion of the investment would be open
to question. Neither the depositing
share corporation nor the underwriters
of the Trust shares should have any
power whatsoever to dissolve the
Trust.
3rd.— Retention of Inherent Mar­
ketability of Underlying Stocks. Cer­
tificates for any number of trust
shares should be convertible through
the trustee to the underlying securi­
ties and other property held by the
Trustee or to the pro rata market
value thereof (should not be necessary
to acc. 500 to 1.000 shares).
....“ 4th— Steadiness of Income. To
meet the demands of 90 per cent of
investors the fixed type of trust must
equalize its dividends to share holders
through a cash stabilized fund refer­
red to as a reserve fund. This is
simply following good corporate prac­
tice as there is no successful corpora­
tion who pays out all of its earnings
in dividends.
“ 5 th— A Continuing Interest. If
the shares corporation and the spon­
sors of a fixed investment trust have
no interest other than that of the ini­
tial profit there is no incentive toward
continued sponsorship of the Trust
certificates but rather an incentive to
form other trusts to make other sell­
ing profits. It is essential that the
profit to the Trustee, the sponsors and
underwriters be a continuing profit,
somewhat in the nature of a renewal
benefit in life insurance. The Trus­
tee and Share corporation should
benefit only if the trust is continued
in healthy condition, and should not
be permitted to make their profit
initially, regardless of what may sub­
sequently happen to the T rust, and in
addition to making the profit in lapses.
If an investor, in selecting an invest-

19
ment trust, will qualify his selection
with these five essentials he indeed
will have safeguarded his funds and
secured an unusually high grade in­
vestment providing the original se­
lection of securities is a good one.
“ To emphasize a bit on some of
these aforementioned essentials; you
will find some exponents of the fixed
type of trust state that the reserve
fund or stabilized fund is not neces­
sary because the surplus of the un­
derlying companies serve the same
purpose.
“ Earning figures of these same
trusts over a period of years show
very definitely that their earnings fluc­
tuate widely from year to year, thus
disproving by their own figures, their
own contention. The necessity for a
cash surrender privilege for any num­
ber of Trust shares has been recently
emphasized by two situations. First,
the New England Investment Trust
Shares. The sponsoring company has
gone out of business. Holders of
1,000 Trust Shares are protected but
those having a lesser number are un­
able to secure a hid for their shares
which anywhere near approaches their
value. The value of the underlying
collateral was recently $11.00 per
share. However, at the same time
sharp shooters in New York were bid­
ding $6.00 per share to the small in­
vestor.
“ Second, on December 2, 1927, the
sponsors of one of four better-known
fixed trusts were bidding $12.00 per
share which had a net breakup value
of better than $14.00. This was a
trust that was previously distributed
by a certain investment house which
is now merchandising a new fixed
type of trust which is the fourth one
they have distributed. Mr. John
Moody is quoted as having said “ the
best type of investment trust, without
any question is that where specific col­
lateral is deposited with the Trust
Company back of the certificates or
other securities issued and sold to the
investor. When this specific collateral
which can not he changed without
liquidating the trust, is placed behind
the certificates which are issued, there
can be no question as to the charac­
ter of the security.”
Circumstantial Evidence
A tipsy man sat down beside a
clergyman in a lobby lounge.
“ Thish’s fine hotel,” he began.
“ Yes, I find it very comfortable.”
“ Whatja say to having a drink?”
“ No, thank you. I never touch the
vile stufif.”
“ Shay, whatja givin’ me? You got­
cha collar on backward now,”


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Federal Reserve Bank of St. Louis

CHANGING FROM A DEBTOR
TO A CREDITOR NATION
By D r. M ax W

inkler,

Vice-President, Bertron, Griscom & Co.

Foreign government and corporate
issues offered in the United States in
the course of 1914 numbered nine­
teen, with an aggregate par value of
$37,722,750, of which $29,794,000 re­
presented government, state and muni­
cipal issues, the remainder represent­
ing foreign corporation loans.
The
countries which came here for accom­
modations included Greece with $3,000,000; Norway with a similar
amount; Sweden with $5,000,000;
Cuba with $10,000,000; Panama with
$2,250,000 ; Porto Rico with $900,000 ;
and Canadian provinces and munici-

palities with $5,644,000. Corporate
borrowing was confined to Canada
with $1,653,750.
From a debtor nation we have em­
erged as the world’s most powerful
creditor country. Instead of owing to
others $5,000,000,000, foreign coun­
tries are indebted to us to the extent
of $14,500,000,000, exclusive of socalled political obligations. As to the
latter, the Treasurer of the United
States held as of December 31, 1926,
a total of $7,497,345,000, received
under agreements for the funding of
their debts from twelve nations, in­
cluding Great
Britain,
Belgium,
Czechoslovakia, Estonia,
Finland,
Hungary, Italy, Jugoslavia, Fatvia,
Fithuania, Poland and Rumania. The

In creasin g y o u r Bank s

P re stig e
It is not necessary to maintain an
expensive bond department of your
own to render a worthwhile invest­
ment service. By offering bonds
recommended by The National City
Company you give your depositors
all the benefits of National City
world-wide investment contact and
knowledge o f bonds and bond mar­
kets. Thus you build up the pres­
tige of your own institution.
Our special Bankers’ List will
help you develop a profitable bond
business without tying up your
bank’ s own funds. We will send it
regularly upon request.

The National City Company
JSalional City Bank Building, New York
Offices in more than 50 leading cities throughout the world
BONDS

'

SHORT

TERM

NOTES

<■

ACCEPTANCES

Central Western Banker, July, 1928

20
unfunded debt which arose in connec­
tion with advances made by the Unit­
ed States for various purposes totalled
as of the above date $3,584,314,555.
W e have thus within thirteen years
become a creditor nation to the ex­
tent of about $25,600,000,000, as com­
pared with about $18,000,000,000 or
$20,000,000,000 of Great Britain’s
foreign investments at their peak, and
which, moreover, it took England
and a generation to accumulate.
Instead of barely a dozen foreign
loans listed on the New York Stock
Exchange, we have today many times
that figure.
The annual turnover

SHORT

TERM

has risen from $3,500,000 to almost
$900,000,000, and instead of nine­
teen foreign loans floated during the
entire year 1914, our market, at the
present time, absorbs that many issues
within less than one month.
Slowly
and gradually the financial center is
being moved from the banks of the
Thames— the classic center of finance
— to those of the Hudson, just as it
moved after the Napoleonic wars
from Amsterdam to London. Today,
New York is successfully vying with
London and Paris, Berlin and Am­
sterdam, Zurich and Brussels,'—From
pamphlet on “ The Ascendancy of the
Dollar.”

INVESTMENTS

FOR

BANKS

shorF> term
obligations have-} been p u r­
chased by m ore

in the

banks

6,ooo
U n ited States.

G e n e r a l M otors
A c c e p t a n c e C o r po r a tio n

“ American Business is Moral”
(Continued from Page 8)

ability and the willingness to deliver
products in the foregoing terms— has
created in the United States an era
of business that calls for the formula­
tion of even a newer business moral­
ity, the morality involved in the obli­
gation to fulfill intrinsically and not
merely superficially every one of tliese
forms of service of which physical
goods are merely the vehicle.
“ Business thus becomes a form of
economic service, an essential part of
what we term social service, and today
any business in the United States
which does not perform social ser­
vice has not long to live.
“ The new spirit is that of a pro­
fession— whose formulae spring from
scientific research and whose applica­
tion is dominated by social signifi­
cance. Even the nature of competi­
tion has changed with this growing
business morality. The ruthless slaugh­
ter of competitiors by fair means, or
foul, has been replaced by a competi­
tion of greater service.
“ The fundamentals of commerce
and industry are being established
through co-operative effort. In the
field of banking, local, state and na­
tion-wide organizations are studying
the principles governing this profes­
sion, hoping to make banking continu­
ally safer and of greater service. T o­
day it is calling to its assistance the
Research departments of our great
universities. And what is true of
banking is equally true of industry
and commerce.
“ Every true American is always
hoping some time or other to repay
America for her wonderful opportuni­
ties, to contribute toward the perpetu­
ation of these opportunities for post­
erity.
“ In a large number of instances,
our civically minded business men of
financial success, have waited until
they retired from active business life,
and then attempted to throw them­
selves into public service with the
thought of doing an outstanding piece
of work as a culmination of their en­
deavors and as their contribution
politically to their country. Yet these
have found that politically they could
not match their outstanding commer­
cial success.”

Executive Office * BROADWAY at 57™ ST. - New York City
Capital, Surplus C? Undivided
Profits . $52,156,000

Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

They Probably Will
Mother: “ Daughter, you cannot
marry Lawrence because he an atheist
and doesn’t believe there is a H ell!”
Daughter: “ Oh M other! Let me go
ahead and marry him and surely you
and I can make him believe there is a
Hell!

21

Insurance

Insurance as Protection
for the Hom e
W hy Insurance Makes it Possible for the G ood That
Men do to Live After Them
What It Will Do
'"T H R O U G H O U T the ages the race
By M rs. O liver J. S m ith ,
^ of man has had one all absorbing
Let us note specifically some of the
ambition. That is to make for him­
things that Life Insurance can do
for the home. The three things that
self and his family a place of safety—
for today for the uncertainties of to­
a home. Primitive men sought the morrow and grew as economic and na­ a man desires to do who is providing
for a home are to create a savings, to
caves, the cliffs, and the tree-tops for
tional life developed.
Surpassing all other forms of in­ meet his obligations, and to provide
protection. The mediaeval man made
for old age. He can out of his salary
surance, Life Insurance has grown to
castles, motes, and city walls within
of $3,000 a year save
which he could pause
.
mu
ii mu in mi imi ii ii ii ii 11mi ii in ii
niiiini
innnnnnni
iiiimiiii min ..................... .
five dollars a week. In
for a time from the
a year’s time, should
mere struggle of exist­
W H AT ESTATES CONSIST OF!
he die, he would have
ence and find a home.
“ By figuring in cents instead of in billions we find eightysaved about enough to
Taw s, trea ties and
seven cents out o f every dollar that a man leaves behind him
meet the funeral ex­
complicated forms of
when he dies, conies from Life Insurance. Insurance has made
penses. But five dol­
g o v e rn m e n t are ail
it possible for the good that a man can do to live after him. It
lars a week put into a
outgrowths of this eter­
life-income insurance
need not be buried zvith his bones as zvas said of Caesar.”
nal instinct of man.
contract would keep a
So today we have
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiimiiiinniiiiiiiiiiiiiiiiniiinniiiHiiniiiiiiiiniiiiiiniinniniiniimnn
living wage coming in
ou r highly co m p le x
and save the home just as though he
civilization whose foundation is the be the greatest private co-operative
home. It would seem that all the old institution in the world. President were there. Then again he might live
long enough to save about $1,000 and
Coolidge has called it the barometer
enemies that would destroy this prec­
ious haven were vanquished, and that of public welfare. Its principles have
then an accident disable him. His
man may spend all of his time now in been scientifically and economically
$1,000 would soon be gone and there
providing for and perfecting and en­ worked out to the immutable laws of
would be no more salary to keep the
joying it.
home. Here again a Life Insurance
human life by groups of specialists.
Yet always there has been and it Competing companies have made it policy with a disability benefit would
seems always will be the wolf of pov­
necessary to give the insured the full­ keep his wages coming in and provide
erty to keep from the door, the thun­
est possible protection and the bene­ an emergency savings. Or per­
derbolt of accident and calamity to
haps, through good fortune he and
fit of the doubt. Its vast wealth is not
fear, and that old unconquerable
a horded pile as some might think, but haps, through good fortune, he and
enemy, death to expect. These singly works in and through all the nation in his wife may live to an old age. His
or enmasse can enter the most secure
safe investments. For instance, there five dollars a week savings actually
home, ravish and destroy it. Statis­
are some forty million people who are saved in an income insurance invest­
tics tell us that every minute of the
ment would begin to come back just
owners of two billion dollars worth
day twenty-one persons are injured
of railroad stock because they consti­ as it was needed and when his own
and every five minutes one is killed by
tute mutual Life Insurance compa­ earning power had ended. They woud
accident. They further say that every
nies. The vast greatness of these in­ not be dependent upon the charity of
day in America 3,800 persons pass
stitutions makes for safety and se­ the younger generation.
away, and that eight out of every 1,000 curity.
There is often a mortgage on the
at the age of thirty will die within one
So closely is this largest institution home that is dependent upon a certain
year. These figures are convincing
per cent of the income to meet the in­
in the world related to our smallest in­
regarding accident and death. Poverty
terest and payments on the principal.
stitution— the home, that it is often
needs no proof. W e see it every­
called "coverage.” And indeed it can When death stops the income the
where.
well be termed the greatest roof in mortgage often takes the home. By
increasing this percentage three or
Affords Protection
the world.
Under its protection
four per cent and putting it into a
American
people
have
been
able
to
Life insurance is the one institu­
Life Insurance policy the mortgage
attain a degree of ownership of homes
tion evolved by civilized man that can
could be paid in event of death and
never before enjoyed by any people.
protect in the face of these enemies.
the home saved.
They have become the richest people
It grew out of marine insurance found
Life Insurance can create an educa­
per capita of any in the world. N o­
necessary about the time when Rome
and Carthage contended for the su­ where else have the luxuries and com­ tional fund, it can satisfy a desire to
aid some great charitable institution,
forts of life been extended to all
premacy of the seas. It is founded
it
can create an estate from a small
classes.
on that basic principle of preparing


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Federal Reserve Bank of St. Louis

ii

ii hi

immimii

Central Western Banker, July, 1928

22
savings. It can bring about a feeling
of security and peace of mind that
can be bought in no other way. By
outreaching death, disability, and pov­
erty, it can make a monument that
will last far into the coming years.
Skilled Salesman Required
So carefully has Life Insurance
been adjusted to meet these peculiar
individual needs that a skilled sales­
man or service man is required to fit
the right policy to the applicant. It
is his office to explain the meaning of
Term, Ordinary Life, Limited Pay­
ment and Endowment policies. It is
his privilege to show the advantages
of cash and loan values, extended in­
surance, disability benefits, double in­
demnity clauses and other clauses
provided in these policies. It is the
policyholder’s duty to study his con­
tract and understand how it fits into
his life plan.
With constantly added benefits and
better educated salesmen, Life Insur­
ance has in the last ten years been
doubling and trebling its usefulness.
This usefulness might be impressed
upon the mind by the following fig­
ures. Dr. Louis Dublin, of the Metro­
politan Life Insurance Company, esti­
mates that the net earnings of men is
about 1,500 billion dollars, a sum more
than five times as great as the value
of real property from all sources put
together.
Sickness alone cuts this
figure two and a half billion yearly.
Premature death cuts it much more.
Compiled figures for 1923 showed
over eleven billion dollars worth of in­
surance taken out in that year. Since
then some two hundred great compa­
nies have double or trebled their
business. Now the earning power of
a single year is extended into the fu­
ture to the amount of more than fif­
teen billion dollars. Note how this
counterbalances the losses presented
by Dr. Dublin through sickness and
premature death. Think what this
means when interpreted in terms of
alleviation of want and misery and
the saving of a man’s most sacred
trust— his home.
By figuring in cents instead of bil­
lions we find the 87 cents out
of every dollar that a man leaves be­
hind him when he dies comes from
Life Insurance. Insurance has made
it possible for the good that a man
can do to live after him. It need not
be buried with his bones as was said
of Caesar.
Meredith Heavily Insured
Edwin T. Meredith, head of the
Meredith Publishing Company of
Des Moines, and former United States
Secretary of Agriculture, who died
Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

recently, was one of the most heavily
insured men in Iowa. Mr. Meredith
carried $320,000 life insurance. His
last policy was taken out in 1924.

B. E. Williams, the retiring presi­
dent, presided and gave an address in
which he outlined the work of the as­
sociation during the past year.

Have Filled the Gap
The National Liberty and allied
companies will not replace Robert H.
Baldwin, who has gone with the Auto­
mobile in Nebraska and South Da­
kota as state agent. The National
Liberty readjusted its field. Mr. Bald­
win handled Nebraska and South Da­
kota for the National Liberty. Ne­
braska is now taken care of by the
Kansas state agent of the National
Liberty, and South Dakota is added
to the North Dakota field.

Close Second Story Movies
The Nebraska state fire marshal’s
office has notified all operators of
moving picture shows located in sec­
ond story rooms to close their places.
Half a dozen such shows have been
found and personal notice to the own­
er of the building and the show pro­
prietor has resulted in prompt closing.

Heads Omaha Association
Hugh Wallace, Equitable Life of
Iowa, was elected president of the
Omaha association of Life Under­
writers. J. E. Moss, Aetna Life, was
elected vice-president; T. J. Bruner,
Travelers, secretary, and L. W . For­
bes, New York Life, treasurer.
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiM iiiiiiiiiiiiiiiiiiiiim iiiiiiiiiiiiiriiiiiit

A well knonw newspaper man is Will Manpin, author of “ Sunnyside Up,” a column
of philosophy and humor that appears in
each issue of the Omaha Bee-News. The
cartoon above was drawn free hand by
Claude F. Anderson, Jr., fifteen year old
son of Claude Anderson, assistant to the
president, State Bank of Omaha, from a
snapshot of Mr. Maupin taken by the
editor of the Central W estern B anker
during the June Nebraska group meetings.

Did Not Pay Premium
In relieving the Northwestern Mu­
tual Life Insurance Co. from liability
on a $2,000 policy of which Agnes I.
Brown was beneficiary, the Supreme
Court of Nebraska says that a life
policy contract automatically ceases
upon the failure of the holder to pay
within thirty days after a premium
becomes due; that it is a plain pro­
vision upon wdiich the company has
a right to rely and being within the
knowledge of both parties it must be
enforced by the courts.
The court holds that the giving of
a check is not payment of an indebted­
ness unless so expressly accepted as
such, and that while the mere pay­
ment may be changed by custom the
actual payment cannot be. The wife
of the insured sent a check during his
last illness that was returned to the
general agent of the company because
of insufficient funds. The general
agent held it while he notified her of
its being dishonored. The court holds
that this did not amount in law to
either an extension of time for pay­
ment or a waiver of payment when
due.
Neighbor Had Premium;
Is Held Agent
A novel question has been brought
by appeal has been brought to the Ne­
braska supreme court for determina­
tion by the World Accident, which
lost in the York district court. Pur­
suant to an agreement between the
collector of the company and the pol­
icyholder, that because of the latter’s
frequent absences from home, Levi
fones nearly always left his premium
with a neighbor, and it was in her
hands when the accident occurred
that killed him. The court below held
the neighbor to be the agent of the
company for purposes of collection
and payment to her was payment to
the company. It holds that she was
the agent of the policyholder.
Success is not a matter of desire,
it is the product of hard work.

23
On July 2, the bank clearings
in Omaha amounted to $10,057,460,
this being the third day in 1928 when
the clearings had passed the ten mil­
lion dollar mark. The total compared
to 7,831,884 the same day a year ago,
following the general tendency for
clearings this year to greatly exceed
those for the same day in 1927.
The previous 10-million dollar days
in Omaha were March 5, when clear­
ings were $10,291,090 and April 24,
when they were $10,240,332. The
biggest day in June was on June 14,
when the total clearings were $9,070,933.
Willard B. Millard, Jr., has been
elected a vice-president o f t h e
Omaha National Bank, following two
years as assistant cashier. Mr. Mil­
lard is a grandson of the late Senator
Joseph H. Millard, who was, for many
years, president of the Omaha Na­
tional Bank.
Four years ago, after his gradua­
tion from Yale university, Mr. Mil­
lard entered the employ of the bank
as a clerk and bookkeeper, and since
then has been active in nearly every
department of the bank. He was
born in Omaha and has traveled a
good deal, both in the United States
and abroad.

Walter W . Head, president of the
bank, in announcing Mr. Millard’s
promotion, said :

he possesses the qualities essential to
success as a banker.
“ Tn recognition of his progress, he
was made an assistant cashier of the
bank in June, 1926, and the directors
feel that he will be a valuable addition
to the bank’s executive staff in the
more responsible position of vicepresident.”
The annual state convention of
the Nebraska Bankers Association will
be held at the Hotel Fontenelle, at
Omaha, October 17 and 18, these
dates falling on Wednesday and
Thursday. The dates were fixed fol­
lowing a conference of the officers of
the association and the Omaha Bank­
ers who will be hosts. Secretary W .
B. Hughes is at work now, arranging
the program for the gathering.

W . B.

M il l a r d ,

Spreading Beauty
Tram p: “ Would you please sub­
scribe half-a-crown to my fund for
beautifying the village?”
The Vicar: “ But, my good man,
how are you going to beautify the
village ?”
Tramp: “ By moving on to the next
village.”

Jr.

“ He has been earnest and industri­
ous in his work, and has shown that

E

ndowment

A man buys a hat to fit his head;
a woman buys one to fit her face.

I nsurance

Our Endowment at Age 65 policy has met with
popular favor among our Hanker representatives
throughout the Middle Western States.
This, we feel, is due to the unique provisions of
the policy, which include a Guaranteed Annuity
option payable monthly for life and many other at­
tractive features.
Special part time contracts, with liberal com­
missions, are available to Nebraska Bankers.

G u arantee

F und

L if e

B u il d in g

18th and Douglas Sts., Omaha

W e Write
O R DIN ARY LIFE
20 Y EA R ACCUMULATION
20 Y EA R ENDOW MENT
ENDOW M ENT AT 6S
ENDOW MENT AT 70
Y E A R L Y RENEW ABLE TERM
TERM INSURANCE FOR S, 10, IS,
20, 25 AND 30 YEARS
DOUBLE IN DEM N ITY
D IS A B IL IT Y BENEFITS
W A IV E R OF PREM IUM
JU VENILE INSURANCE


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Federal Reserve Bank of St. Louis

Write for a copy o f our folder: “ Where Will You
be at 6 5 ? ”

Guarantee Fund

. LIFE VT

A ssociation
- O M AH A-

Assets Exceeding $13,000,000.00

Central Western Banker, July, 1928

24

Neb raska News
This action puts the banks and other
loaning concerns definitely under the
assessment of moneys, credits, stocks,
bonds, and other securities.

C. A . S M IT H , P re sid e n t
N e b r a sk a B a n k e r s A s s o c ia tio n

W M . It. H U G H E S , S e c re ta r y
N e b ra sk a B a n k e r s A s s o c ia tio n

Install Ventilator
The West Point, Nebr., National
Rank has just installed a modern in­
vention which will be recognized as a
most important safe-guard for the
lives of customers and employees.
Ordinarily this equipment presents
on the outside of the vault the face
of the polished end of a cylinder of
hardened, heat-resisting steel; so that
the burglar at once recognizes it as
the poorest possible place to attempt
an attack upon the vault.
But if anyone within the vault finds
need of ventilation, he, or she, can un­
lock the steel core of the cylinder and
withdraw it; and then slide into its
place a high speed electric fan.
The result is ample air supply for
any number of people that may be
crowded into the vault— fresh air be­
ing drawn in while foul air is forced
out.
Tax Victory
Recognizing as final the recent legal
victories of national and state banks,
the Nebraska board of equalization
announces no further attempt will be
made to assess those institutions on
the basis of 70 per cent of their capi­
tal resources, as provided by an act
of the 1925 legislature.
A circular letter which T. E. W il­
liams, state tax commissioner, sent to
county assessors, clerks and boards of
equalization, instructs those officials
to list all banks, trust and invevstment
companies and loan corporations at
five mills on the dollar of their valua­
tion after deducting real estate other­
wise taxed.
Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

Opens in Rohrs
The Farmers Security State Bank
at Rohrs, Nebraska, has opened with
J. P. Gillilan as cashier. The bank
will be stronger than ever and better
able to servve the people of the com­
munity in which it is located.
Mr. Gillilan who is a former county
treasurer of Nemaha county is a
banker of long and successful experi­
ence.
Recent Appointments
Gov. McMullen recently announced
the appointment of two members of
the state guaranty fund commission
for terms of three years each, and one
member to succeed himself, also for
three years.
For the territory included in bank­
ers group No. 4, which is southwest­
ern Nebraska, Ed Van Steenberg,
president of the Franklin County
Bank, at Hildreth, was appointed. He
succeeds Van E. Peterson, secretary
of the Commission who recently an­
nounced he did not wish to be reap­
pointed.
J. M. Flannigan, president of the
Citizens bank at Stuart, was named a
member of the commission for group
No. 6 in northwestern Nebraska. Pie
takes the place of Fay Hill, Gordon
banker.
Henry C. Peterson, president of the
Chappell State Bank, was reappointed
from Group No. 7, in western Ne­
braska.
Four other members of the com­
mission hold over this year.
Buys Control
Controlling interest in the State
Bank of Jansen, Nebr., has been pur­
chased by John M. Nider, farmer and
extensive property owner. He bought
out Herman Thiessen, who has acted
as president of the institution for the
past 25 years. The directors are John
M. Nider, P. J. Teissen, F. C. Achtiemer, H. T. Fast and Henry Wallbaum.
Mr. Nider was elected president.
Take Short Course
Forty-six members of the Nebraska
Mortgage Bankers Association, a ma­
jority of them Omaha men, took the
Nebraska university short course for
land appraisers, traveling from Lin­

coln in two 30-passenger busses thru
Lancaster county to Wilbur, thence to
Hastings, Grand Island, Central City
and back via Stromsburg and David
City. Among the farms visited were
those of Charles Olmstead in Lancas­
ter county, and John Hassik, near
David City, where the value of crop
rotation was evidenced.
Elected Cashier
M. H. Eggert of Panama was elec­
ted cashier of the Bank of Syracuse,
Nebraska, at a meeting of the direct­
ors held recently and will take the
place of M. H. Rodgers, who has re­
signed to enter the insurance field.
Mr. Eggert has been with the Bank
of Panama for several years and is
experienced in banking business.
Merged
The First National Bank of Mar­
quette, Nebr., has taken over all as­
sets and deposits of the Farmers State
Bank, and has now combined depos­
its of $460,000, with total resources
of over half a million.
The officers of the First National
Bank are as follows : A. W . Hickman,
president; J. D. Ferguson, vice-presi­
dent; M. E. Isaacson, cashier; C. N.
Turner, assistant cashier; A. E. Eriksen, assistant cashier.
Resigns
W . P. Corbett, who has been as­
sociated with the Carson, Nebraska
National Bank for more than twenty
years, has resigned his position, the
resignation taking effect July 1. Flis
action is deeply regretted by his as­
sociates at the bank.
Mr. Corbett was a man who de­
voted his entire energies to his work
and who was dependable and faith­
ful in all things and has well earned
the rest and recreation that he has
long denied himself.
Loans Increase
Total loans made by the Federal
Land Bank of Omaha during the first
half of the year were $13,433,000,
taking total loans outstanding to $161,734,322, it was announced recently.
Net loans closed during June amount­
ed to $857,300. The net loan increase
for May was $1,251,700, compared
with $1,087,000 for the same month
in 1927. This was the biggest month­
ly gain over last year during the first
half of 1928.
Payments on loans during the six
months totaled $3,438,600.

25
Omaha Deposits
Deposits in Omaha banks on June
30, totaled $121,373,993, or more than
$12,000,000 more than the total de­
posits of June 30, 1927, according to
a bank call ordered by the comptrol­
ler of the currency. Loans and dis­
counts were slightly less than a year
ago, the total last June 30, being $65,380,126.
Consolidate
Clarence Bliss, secretary of the state
department of trade and commerce of
Nebraska, announces the Farmers
State and the First National Bank at
Marquette have consolidated.
Install Machine Gun
The “ artillery” purchased recently
by the Omaha branch of the Federal
Reserve bank as a protection against
bandits, has been installed in the bank
building.
In a specially built steel “ turret,”
four feet square, constructed on the
north wall of the bank near the ceil­
ing and facing the paying teller cages
is a machine gun “ nest.” Across the
top is a strip of bullet-proof glass, and
below an aperture through which the
muzzle of the machine gun may be
pushed. In the employ of the bank
are five guards, who are former police
officers.
Revolvers have been placed in each
of the bank cages, and the guards also
are armed. Protection by sawed off
shotguns is afforded at the rear of the
bank building, where daily hundreds
of thousands of dollars is transferred
by armored truck to other Omaha
banks.
Quitting Business
Depositors in the Goodwin State
Bank, of Goodwin, Nebraska, have
been notified of the liquidation of that
institution in the near future. Time
certificates not due will be credited
with interest until the time their hold­
er’s receive the money.
Officers of the bank are; J. C. Dug­
gan, president and Tom Brozek, cash­
ier.
Resigns
Harry Welch, assistant cashier of
the Nebraska National Bank, Hast­
ings, Nebr., has resigned his position
and will be succeeded by C. L. Swan­
son, assistant cashier of the Fidelity
National Bank at Aurora. Mr. Welch
has been connected with the bank since
1910. He hasn’t announced his plans
for the future, except to say he ex­
pects to leave Hastings.


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Heads County Bankers
E. H. Gerhart, president of the
First National Bank of Newman
Grove, Nebr., was re-elected president
of the Madison County Bankers As­
sociation. Mark O ’Shea of Madison
was elected vice-president, and L. P.
Pasewalk of Norfolk, secretary-treas­
urer.

Norfolk was again chosen as the
meeting place for the next session,
which is scheduled for the first of
August.
A generous friendship no cold medium
knows,
Burns wit hone love, with one resent­
ment glows.— Pope.

E X P E R IE N C E

F ID E L IT Y

PERM ANENCE
IN CONTINUOUS EXISTENCE
SINCE 1891

PACKERS
NATIONAL BANK
Affiliation

PACKERS NATIONAL
COMPANY
INVESTMENT BONDS

SOUTH

DE

OMAHA

National Bank
iTrustCompany
O M A H A

‘An Unbroken Record of Seventy Years
is a Guarantee of Safe and
Satisfactory Service”

OFFICERS:
M. T. B arlow , President o f the Board
R. P. M orsman , President

G. H. Y ates, Vice-President
R. R. R ainey , Cashier
J. C. M cClure, Vice-President
H. E. R ogers, Assistant Cashier
T. F. M urphy , Vice-President
E. E. L andstrom, Assistant Cashier
C. F. B r in k m a n , Ass’t V.-President
A. L. V ickery, Assistant Cashier
P. B. H endricks, Ass’ t Vice-President V. B. Caldwell, Assistant Cashier

Central Western Banker, July, 1928

26

OFFICERS
FORD E. EtOVEY, President
JAS. B. OWEN, Vice-Prés.
F. J. ENERSON, Vice-Pres.
W. L. PIER, Vice-Pres.
W. H. DRESSLER, Cashier
L. K. MOORE, Asst, to Pres.
H. C. MILLER, Asst. Cash.
C. L. OWEN, Asst. Cash.
T. G. BOGGS, Auditor

OUR B A N K IN G ROOM
M A IN FLOOR RIGHT

The Fact:
That we are located in the heart of the live
stock market,
That this bank has on its staff the highest
grade of specialists, not only in the live stock
business but in all phases of banking,
That we are equipped to anticipate your
every need,
That we are willing and anxious to serve
you,

A re some o f the reasons
why you should let us
handle yo u r business.

Stock Yards National Bank
of
South Omaha
The Only Bank in the Union Stock Yards

Central Western Banker, July, 1928

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Federal Reserve Bank of St. Louis

Secretary Hughes of the Nebras­
ka State Bankers Association calls at­
tention to the fact that in the com­
ment in the press upon the supreme
court decision setting aside the state
tax law calling for a higher tax upon
bank stocks as intangibles, the fact
that bank shares have always been
taxed at their full value. Mr. Hughes
says:
“ This decision has caused consider­
able newspaper publicity in all of
which there is a noticeable failure to
consider the fact that for generations
bank shares have been taxed at their
full value, easily ascertainable, while
other kinds of property escaped at
only a portion of their value— as low
as 50 per cent according to some esti­
mates— and if this decision lets banks
off easily for 1928 it is no more than
a partial leveling up for their disad­
vantages of years standing. And
these newspaper articles about the de­
cision, bewailing the small tax to be
paid by banks for 1928, are entirely
silent— unfairly so, we think— about
the heavy special tax of about $1,500,000 being paid annually into the
Guarantee Fund by the State Banks
for the public’s benefit.”
The taxation committee of the
state association outlined the bank­
er’s position on taxes, after a meeting
in Omaha June 25, and sent a circular
letter to the bankers, the principal
points of which follow :
Regarding 1928 taxes: Suggest that
all banks carefully watch to see that
the assessor tax shares on the intan­
gible 5-mill basis.
Regarding 1927 taxes: Banks that
paid under protest are advivsed to re­
quest refund, which, if disapproved,
each bank must decide its own course
as to bringing suit. Banks that did
not pay under protest are advised
there is little likelihood of a refund.
Furniture and fixtures: The com­
mittee promised to oppose in the
courts, as illegal, the announced in­
tention of tax officials of several coun­
ties, to attempt to segregate furniture
and fixtures for taxation at the full
rate for tangible property.
How to Prevent Check Swindles
1. Keep blank checks and cancel­
led vouchers under lock.
2. Write checks with safety ink or
w\ith a check-writing machine that
shreds the paper and impregnates it
with the amount in ineradicable ink.
3. In writing checks, leave as little
space as possible between the figures
of the amount, and start the written
amount as close to the left-hand mar­
gin as possible, drawing heavy par­
allel lines through the unfilled space.

27

News of the

Approve Group Meeting Resolution
Bankers of the south side, Omaha,
whose business is intimately connect­
ed with the live stock industry, view
with satisfaction the support given at
all the recent state group meetings, of
the following resolution:
“ W e view with much concern the
increase in country buying of live
stock by packers. W e recommend that
necessary legislation be enacted by
congress to preserve for our farmers
and stockmen the continuance of com­
petitive open markets for live stock.”
Federal Land Bank Loans
Total loans made by the Federal
Land Bank of Omaha, during the first
half of 1928, were $13,433,000, rais­
ing the amount of total loans outstand­
ing, to $161,734,322, according to an
announcement by John Carmody, sec­
retary. Net loans closed during June
amounted to $857,300. The net loan
increase for May was $1,251,700,
compared to $1,087,000, for the same
month in 1927. Payments on loans
during the six months period ending
July i, totaled $3,438,600.
President D. P. Hogan of the land
bank made the following statement:
“ Our collections are much better than
they were a year ago at this time, and
this seems to me to be a certain indi­
cation that business is steadily on the
upgrade in this territory.
Dies Suddenly at Tilden
The sad news reached Omaha re­
cently of the sudden death of Charles
L. Corkle of Tilden. He was taken
with a heart attack and passed away
suddenly. He was 62 years of age.
Mr. Corkle was a pioneer in that
section of the state. He was a well
known farmer, live stock feeder and
breeder of pure bred live stock. In
company with his sons, Mr. Corkle
was engaged in the business of rais­
ing pure bred Hereford cattle. Qual­
ity Whitefaces from his farm have


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Omaha

been no small factor in the improve­
ment of the breed, many animals go­
ing out as foundation stock for new
herds.
“ Show Calf” at $15.00
Making a gain of 410 pounds since
January 1, a Shorthorn calf belong­
ing to a Carroll county, Iowa, club
boy, Harold (Chubb) Hassler of Man­
ning, tipped the scales at 1,050 pounds
recently in the Omaha market and
sold for $15.00 per cwt. On January
1 this calf weighed 640 pounds.
Harold was not able to come to the
market, but his father, Fred Hassler,
trucked the animal in. This calf was
one of the three being fed by the son
Harold, but because it did not seem
likely to make a good show animal, it
was decided to sell him at this time.
A Hereford and an Angus are on feed
and will no doubt be brought to the
Ak-Sar-Ben Exposition in November.
Curb “ Bootlegging” of Hogs
Bootlegging in hogs will be a thing
of the past since the Nebraska state
law went into effect requiring animals
from accredited areas to be branded
before raisers can collect a 10 per cent
bonus.
A state-wide system of branding
has been worked out by the live stock
commission. Dies for the brands will
be handled through county extension
agents.
The system will enable authorities
to determine from what 40-acre sec­
tion of the state hogs are shipped, and
it will permit disease to be traced to
its source. Owners of diseased hogs
shipped from accredited areas will be
docked at market, it was explained.
Dairy Cattle Congress Judges
Judges for the cattle department of
the nineteenth annual Dairy Cattle
Congress, to be held at Waterloo, la.,
October 1 to 7, inclusive, are an­
nounced by the management as fol­
lows :

Stock Yards

Holsteins— W . S. Moscrip, well
known breeder and judge, Lake Elmo,
Minn.
Guernseys— H. H. Kildee, professor
of animal husbandry, Iowa State Col­
lege, Ames, Iowa.
Jerseys— J. B. Fitch, professor of
dairy husbandry, Kansas Agricultural
college, Manhattan, Kan.
Brown Swiss— J. P. Allyn, promi­
nent breeder and judge, Delavan,
Wis.
Ayrshires— E. L. Anthony, profes­
sor of dairy husbandry, Morgantown,
W . Va.
“ A Real Market”
“ Believe me, Omaha has a real cat­
tle market, and I want to put in a good
word for it. Competition for these
good steers couldn’t be any stronger
anywhere than I find it right here,”
declared Jesse C. Weaver, well known
Oakland, Iowa, feeder, after his ship­
ment of 43 steers averaging 1,113
pounds had sold at $15.35 recently.
Leads Again
R. B. Stone of Nehawka again has
the high cow in the Cass-Johnsom
Otoe county dairy herd improvement
association. Mr. Stone’s high cow
produced 1,708 pounds of milk, 78.6
pounds of butterfat and her test was
4.6 per cent during the month. Mr.
Stone also had the high herd of the
group of from five to fifteen cows. His
eleven cows produced an average of
44.2 pounds of butter fat for the
month. A. O. Rame of Plattsmouth
had the second high herd of 16 cows
and over.
Dairy Prices
There has been little change in the
butter market for some time and there
is little probability of dairy products
prices falling below the present level
according to information received by
the state and federal division of agri­
cultural statistics at Lincoln. Unfav­
orable weather has held up excess proCentral Western Banker, July, 1928

28
duction in foreign countries, our own
seasonal peak has been reached, and
storage stocks though increasing, are
still below last year’s, while prices are
firm.
Receipts of cheese at Wisconsin
warehouses are falling below last year,
and while a June 16 report of the A s­
sociation of American Creameries
showed increases in butter output. The
Land o ’Lakes Creamery Corporation
reported a decrease for the same per­
iod. Pasture conditions in sections
have improved but dealers feel cer­
tain that our seasonal peak production
has been reached and prices will not
go lower this summer. United States
imports of butter, and cheese, and ex­
ports of condensed and evaporated

milk have been lighter than last year
though imports of fresh milk and
cream have been heavy.
Dairy and Poultry Meeting
A big dairy and poultry meeting
will be held in O ’Neill, July 21. A
special train will be run from the ex­
tension service of the University of
Nebraska, at Lincoln. Mr. Liebers,
manager of the dairy development so­
ciety, Frank Mussehl, head of the
poultry department ,and R. W . Mc­
Ginnis, special agent for the Chicago,
and Northwestern, will have charge of
the train. At the meeting the question
of better dairy cows, boys’ and girls’
4-H dairy calf clubs and poultry clubs
will be discussed.

Holt county is one of the largest in
the state— 58 miles wide and 62 miles
ong, and is one of the best cattle, dairy
cow and poultry counties west of the
Mississippi river.
SPECIAL HARVEST TRAIN
Preliminary plans were completed
in conferences recently at the Nebras­
ka Agricultural college to operate a
Wheat Harvest Special train over the
Union Pacific and Northwestern lines
in eastern Nebraska from August 13
to 25 inclusive.
Visits have already been made to
towns where the train will stop. Local
chairmen have been chosen and local
plans for a big harvest festival at
each place are now under way.
The Union Pacific will furnish the
coaches and operate the train over its
lines for seven days. The Northwest­
ern will operate the train over its lines
for five days. The train will prob­
ably be spotted on the state fair
grounds during state fair week. The
agricultural college will prepare the
exhibits of all but one coach and send
its agricultural and home economics
specialists with the train. The Omaha
Grain Exchange will prepare one
coach of marketing exhibits and send
two men with it.
Three stops will be made each day.
In the itinerary given below the first
town each day will get a morning stop,
the second an afternoon stop, and the
third an evening stop. The itinerary
follows :
Monday, August 13, Papillion, Elkhorn, North Bend.
Tuesday, August 14, Schuyler, Sil­
ver Creek, Central City.
Wednesday, August 15, W ood
River, Gibbon, Kearney.
Thursday, August 16, Elm Creek,
Lexington, Cozad.
Friday, August 17, Polk, Osceola,
Mead.
Saturday, August 18, Cortland,
Blue Springs, Fairbury.
Monday, August 20, Belvidere,
Fairfield, Hastings.
Tuesday, August 21, Harvard,
York, Gresham.
Wednesday, August 22, David City,
Beaver Crossing, Seward.
Thursday, August 23, Geneva, Dav­
enport, Superior.
Friday, August 24, Hooper, Dodge,
Clarkson.
Saturday, August 25, Humphrey,
Newman Grove, Albion.
The vital air of friendship is com­
posed of confidence. Friendship per­
ishes in proportion as this air dimin­
ishes.— Roux.

Central W estent Banker, July, 1928

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Federal Reserve Bank of St. Louis

29

Doing Big Things in a
Big W ay
When they want a big job done in
Omaha, they are certain, sooner or
later, to call into conference, in some
leading capacity, Ford E. Hovey, the
president of the Stock Yards National
Bank of Omaha. He has a habit of
doing difficult jobs thoroughly, doing
them well, and doing them with a
minimum of confession. He happens
to be, besides the president of his
bank, the president also of the Union
Stock Yards Company of Omaha, a
bulwark in the city’s financial and in­
dustrial strength.
Mr. Hovey was born in Henderson,
N. Y., in 1876. Twenty years later
he was in the west, a bookkeeper in
the Bank of Horton, Kans. In five
years he became cashier of the bank,
and was married to a Horton girl.
In 1910 Mr. Hovey became vicepresident of the St. Joseph, Mo., Stock
Yards bank and the St. Joseph Cat­
tle company. He lived in St. Joseph
for five years, and was then called to
Denver to take the presidency of the
Denver Stock Yards Bank and the
Denver Cattle Loan company. The
next year he came to Omaha as vicepresident of the Stock Yards National


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Federal Reserve Bank of St. Louis

Bank, the Cattle Feeders Loan com­
pany, and the South Omaha Savings
Bank.
In 1920 he became president of the
Stock Yards National Bank of Omaha.
Mr. Hovey became president of the
Union Stock Yards company of Oma­
ha in 1925, succeeding the late Everett

FORD E. H O VEY

Buckingham.
Under his direction
Mr. Buckingham's dream of a great
new home for the Live Stock Ex­
change in Omaha, was carried through
to completion, the company building
a ten story, brick and steel exchange
building that is one of Omaha’s hand­
somest structures. The growth of
the South Omaha market led also to
stock yards company constructing a
new steel and concrete viaduct; new
loading docks for trucks that are be­
coming increasingly important in
bringing live stock to market, and in
.other improvements. Mr. Hovey’s
bank has its quarters in the Live Stock
Exchange building.
Ford Hovey served as chairman of
the executive committee, and then as
president of the Omaha Chamber of
Commerce, 1924-1926. He has been
for three years a member of the board
of governors of Ak-Sar-Ben. His ex­
perience in stock matters is proving
of vast help in the plans for the first
livestock exposition, that will be held
next fall, in the new Ak-Sar-Ben Live
Stock Pavilion. Mr. Hovey has been
active also in the First Methodist
church of Omaha, and is chairman
of the board of trustees of the Ne­
braska Methodist hospital.
The characteristic of his work is a
quiet, sure directness that inspires con­
fidence in those working with him.

GRAIN DRAFTS
W E GIVE IM M E D IA TE C RE D IT A N D G U A R A N T E E
QU ICKEST POSSIBLE P R E S E N T A T IO N

LIVE STOCK NATIONAL BANK
OMAHA
BO N D IN V E ST M E N T S

-

-

W R IT E US

Reliable Information Furnished, Without Obligation

Central Western Banker, July, 1928

30

South Dakota News
Open for Business
The Badger State Bank, Badger,
S. D., opened for business recently.
The new officers are: Andrew Nel­
son, president; F. A. Carpenter, cash­
ier; Louis Horstad, assistant cashier,
and Peter Peterson. K. V. Anderson,
Chris Anderson and F. A. Carpenter,
directors.

M enno; R. H. Seydel, Menno State
Bank, M enno; L. E. Schmitt, Menno
State Bank, Menno; F. T. Hirsch,
Farmers and Merchants Bank, Tripp;
L. Roy Klatt, Dakota State Bank,
Tripp; Oscar Brosz, Dakota State
Bank, Tripp; Fred G. Borman, Farm­
ers State Bank, Beardsley; John Bor­
man, Farmers State Bank, Beardsley;
W. J. Steichen, Dimock State Bank,
Dimock; W . H. Shaw, Hutchinson
Appointed Assistant
O.
B. Wallace, a bank examiner of County Bank, Parkston; J. M. Moes,
Hutchinson County Bank, Parkston;
Fall River county, South Dakota, has
Wm. C. Rempfer, First National
left with his family for Pierre, where
Bank, Parkston.
he will take up his duties as newlyMinutes of the meeting held at
appointed assistant to the superintend­
ent of state banks. Mr. Wallace’s Tripp May 29th were read and on mo­
tion approved as read.
place has been taken by Paul Loomis,
The matter of united action with
bank examiner at Rapid City, who will
reference to service charge on small
probably maintain an office in Hot
checking accounts was thoroughly dis­
Springs.
cussed, and on motion the matter was
laid on the table until the August
Close Saturday Afternoons
meeting.
Four banks in Sioux Falls, S. D.,
The advisability of having speakers
are closing their doors at noon on Sat­
at future meetings was favorably re­
urdays during the summer months.
ceived, and subjects for future dis­
The following banks will operate on
cussion and consideration were sug­
this schedule: Security National
gested.
Bank, Minnehaha National Bank,
Citizens National Bank and the Corn
Driscoll Heads Bankers
Exchange Savings Bank. This ar­
rangement will take effect on and af­
R. E. Driscoll, cashier of the First
ter July 7.
National Bank of Lead, was elected
president, and Thomas O ’Brien, presi­
Meet in Freeman
dent of the State Bank of Hoven, was
A called meeting of the Hutchin­ elected vice-president at the South
Dakota Bankers Association at the
son County Bankers Association, pur­
suant to adjournment, was held in closing session of the organization.
Other officers elected w ere: J. C.
the city hall of Freeman, S. D. re­
Basset, of Aberdeen, treasurer; and
cently, with R. H. Seydel, president,
members of the executive council :
presiding.
The following bankers
George K. Brosius, of Vermilion,
were present: J. J. Tschetter, First
group 1 ; Clarke Bassett, of Aberdeen,
National Bank, Freeman; J. J. Waltgroup No. 6, and M. I. Larsen, of
ner, First National Bank, Freeman;
Mound City, group No. 7.
J. W . Ulmer, Jr., Menno State Bank,

Rapid City was chosen as the 1929
meeting place, the date to be set later.
Other elections were as follows :
D. PI. Lightner of Aberdeen, mem­
ber of the executive council for a
term of three years, to succeed A.
Kopperud of Oldham.
Don W. Devey, of Westport, state
vice-president, to succeed M. F. Pat­
ton of Mitchell.
A. Kopperud, of Oldham, member
of the nominating committee.
W. S. Rempfer, of Parkston, alter­
nate member of the nominating com­
mittee.
M. L. Thompson, of Vermilion state
vice-president for the national bankdivision.
H. R. Kibbee, of Mitchell, state
vice-president for the savings bankdivision; George M. Townsend, of
Huron, state vice-president for the
state bank division, and A. F. Smith,
of Mitchell, state vice-president for
the trust company division.
Settles Tax Question
The South Dakota supreme court
has rendered its opinion in the mat­
ter of bank taxation, The Commer­
cial State Bank of Wagner vs. E. E.
Wilson, County Treasurer of Charles
Mix County; appeal from the circuit
court of Charles Mix County.
All mooted questions are settled by
this decision, which was handed down
on June 30:
1. State banks are entitled to the
same protection in the matter of tax
rates as are national banks ;
2. The moneys and credits taxlaw is constitutional ;
3. Banking capital in South Da­
kota is to be considered in competi­
tion with other moneys and credits,
and
4. The maximum tax which can
be levied on bank stock is 4 mills.
This settles the tax liability ques­
tion under the South Dakota laws.

BANK OF N EW SO U TH W ALES
AUSTRALIA
P A I D -U P

C A P I T A L ________________

_$ 37,500,000

IIE S E K V E

F U N D ___________________

_

28,250,000

_

37,500,000

R e se r v e L ia b ility o f F r o p r ie to r s .
E S T A B L IS H E D

1815

____ $ 1 03,080,600

$438,905,640

Aggregate Assets 30th September, 1927
A G E N T S — F I R S T N A T IO N A L B A N K , O M A H A , N E B R A S K A
G E N E R A I , M A N A G E R , O S C A R L IN E S

HEAD OFFICE, GEORGE ST., SYDNEY

LONDON OFFICE, 29 THREADNEEDLE ST., E. C.

518 B r a n c h e s an d A g e n c ie s in all A u s tr a lia n S ta te s , N e w Z e a la n d , F iji , P a p u a , M an d a ted T e r r ito r y o f N ew G u in ea
L o n d o n . T h e B a n k C o lle e ts fo r and U n d e r ta k e s the A g e n c y o f O th er B a n k s , and tr a n s a c ts e v e r y
d e sc rip tio n o f A u s tr a lia n B a n k in g B u sin e ss.

Central Western Banker, July, 1928


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

and

31
Kansas, for the past four years, died
recently at his home. Mr. Harris was
prominent in the banking circles of
Kansas and was also active in civic
affairs in his community.

Kansas News
County Bankers Meet
Eureka, Kansas, was the meeting
place for the last gathering of the
Greenwood County Bankers Associa­
tion. Among other matters discussed,
the bankers were unanimous in their
approval of the adoption of the ser­
vice charge and appointed a committee
to draft rules which would be applic­
able to all banks in the county.
Protest Rate Fixing
The banks of Ellis county, Kansas,
have entered a protest against the new
ruling of the State Banking Commis­
sion which fixes the rate of interest on
time deposits at 3 per cent. It was
believed that such a rate of interest
would cause heavy withdrawals, thus
making it difficult for banks in west­
ern Kansas to handle loans for the
harvest period.
Open New Offices
Brown Crummer Company, invest­
ment bankers of Wichita, Kansas, re­
cently opened a new office in San An­
tonio, Texas, with R. K. Dunbar in
charge. Mr. Dunbar has been with
the Brown Crummer Company for
several years and was formerly in the
Dallas office.
Appointed Cashier
The First National Bank of Eureka,
Kansas, announces the recent appoint­
ment of George Mack as cashier of
that institution. The bank also an­
nounces the election of Robert Brookover to the Board of Directors.
Adds Trust Department
The Union National Bank of Man­
hattan, Kansas, has recently added a
Trust Department to the several other
departmental facilities. This depart­
ment is under the management of C.
E. Floersch, who has the title of Trust
Officer and he is assisted by John W .
Vordts.

regular business session took place.
The main topic for discussion was as
to whether banks in the county should
close during the noon hour. It was
thought that closing at noon would
provide a certain amount of protection
against robbery, especially when the
bank force was decreased.
Merger
The Jefferson County Bank of Oskaloosa, Kansas, has recently been ab­
sorbed by the Bank of Oskaloosa and
the institution will now do business
under the name of the latter institu­
tion. The officers of the bank of Os­
kaloosa, which were W . E. Huddles­
ton, president, and T. A. Huddleston,
cashier, will remain as before.
Banker Dies
W. T. Harris, who has been presi­
dent of the Citizens Bank of Solomon,

24


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Federal Reserve Bank of St. Louis

When a man is his worst enemy
he should make friends with himself.
Happiness depends upon ourselves.

HourContinuous Service
Always alert, ever ready to serve banks on Safe, Vault
and Timelock Equipment. An organization built on ser­
vice with a personnel of trained experts thoroughly com­
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on any make of equipment.
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braska and Iowa State Bankers Associations

Fifty-four Field Experts in constant touch with us and
always available to you.

F. E. DAVENPORT & COMPANY
Official Safe, Vault and Tinielock Experts for
Nebraska and Iowa Bankers Associations

2061 Farnam Street
Telephones:

Omaha, Nebraska

Office, Ja. 1821; Res. Ke 6382 and Ke 3123

TYPEWRITERS

Granted Charter
The Banking Department of Kan­
sas announces the granting of a char­
ter to the Russell Farmers State Bank.
The bank will have a capital of $100,000.
Meet in Winfield
Members of the Cowley County
Bankers Association met recently in
Winfield, Kansas. A banquet was ser­
ved in the evening, after which the

Clearings Increase
Pueblo, Colo., bank clearings for
the first six months of the current
year, have shown a marked increase
over the corresponding period for
1927. Clearings for the six months
period ending June 30, were $35,302,283.57, a gain of over two and onehalf million as compared with the ini­
tial six months period of 1927, the
report indicates.
Monthly clearings for June also
show an increase of approximately
one-half million, showing that busi­
ness in Pueblo and vicinity is show­
ing gradual improvement.

AND

A D D IN G M ACHINES
EVERY MAKE— LARGE OR PORTABLE

CORONA FOUR
S tand ard F ou r B ank K e y b o a r d
— W id e C a riia g i

7 Col.

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$60

A d d in g
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$100

F. J. W E TSS

GEO. F. P1NNE

Central Typewriter Exchange, Inc.
1912 FA R N A M ST.

{Established 1903)

O M AH A. NEBR.

Central Western Banker, July, 1928

32
A Dozen Ways to Stop
Losses and Create Earnings
(Continued from Page 6)

potatoes, alfalfa or does some thing
really worth while, to the credit of
your community, don’t go home and
tell the wife about it, tell the world

about it. Send it in to C. J. Claassen,
chairman of the Publicity Committee,
Nebraska Bankers Association. Boost
your home town and community and
sell the idea to your customers.
The banks of Nebraska, like those
of most agricultural states, have had

Established 1856

THE NATIONAL PARK BANK
o fNEW YO RK
214 Broadway

BRANCHES
399 Seventh Avenue

210 Park Avenue

T o l»e opened d u r in g 1 9 2 8 :
M a d iso n Sq u are an d 26 th St.
B r o a d w a y at 74 th St.
C h a ir m a n o f tlie B o a rd ,

R ic h a r d D e la fie ld
P re sid e n t,

C h a rle s S. M cC a in
V ic e -P r e s id e n ts

C h a rle s S c rib n e r
M a u r ic e H. E w e r
H. E. S c h e u e r m a n n
R a lp h B. C e r e ro
J a y D. R isingH a r o ld W . V a n d e r p o e l
Jam es B ru ce
W a lt e r S. J e lliffe
A r th u r W . M cC a in
C a sh ie r,

F r e d e r ic k
A s s is t a n t

O. F o x c r o f t

V ic e -P r e s id e n ts

W illia m A. M ain
W illia m C. M a c a v o y
L o u is H. O h lr o g g e
J o h n B. H e in r ic h s

C la u d e H. B e a t y
J o h n M a tth e w s, Jr.
R . J. W h itfie ld
D a le G ra h a m

A s s is t a n t C a sh ie rs

W illia m E. D o u g la s
H e n r y L. S p a rk s
B y r o n P. R o b b in s
J o s e p h E. S illim a n
S ta n le y F. K e t c h a m
K e n ly S a v ille
H a r o ld M. T r u s lo w
G e o r g e C. B r a d e n
W illia m F. L a tu s
A r th u r R. B r o w n
T h o m a s B. C a r lto n
C a p ita l, Su rplu s and U n d iv id e d P ro fits, $35,000,000

FA C ILITIE S

TO

M EET A L L

BA N K IN G REQ U IREM EN TS

F IR S T N A T IO N A L
B A N K of CHICAGO
A ffilia ted

FIRST TRUST AND
SAYINGS BANK
Resources Exceed
$450,000,000.00

Central Western Banker, July, 1928

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Frank O. Wetmore, Chairman
Melvin A. Trayler, President

rather tough sledding for the past
eight years. W e have been trying to
do too much for nothing, along with
a lot of damn poor banking. As a
result dividends have been scarce,
guaranty fund sick, assessments, con­
solidations and liquidations have been
numerous, and you wonder sometimes
whether it is worth the effort.
I was just perusing some of George
Washington’s letters of record, that he
sent to personal friends just previous
to the framing of the Constitution.
He stated that he was discouraged,
melancholy and blue, and that if some­
thing was not done at once, the coun­
try would be in the throes of anarchy
and mutiny and chaos would rule su­
preme; but happy for you and I, a
few cool-headed men, trained in the
operation of government and govern­
ment laws; men who had foresight
and courage, framed a code or plan
for the operation of our government,
a plan that is to government what the
digits are to mathematics, the scale is
to music, and the alphabet is to lan­
guage. A plan that has never been
surpassed in all government history,
and today you and I are a part of the
greatest nation on earth. W e not only
excel all other nations in material
wealth and intellectual progress, but
we have advanced to a point where
our opinion places the stamp of final­
ity on the very destiny of nations.
Fellow bankers, we have a man by
the name of Smith, who signs as
president of the Nebraska Bankers
Association, a flying secretary named
Bill Hughes— a man at the head of
the Banking Department by the name
of Bliss, non-political, and a banker,
one who is ever ready to co-operate,
an executive council of your State As­
sociation, composed of men who are
competent and capable of framing a
code or plan for the bankers of this
state. But to do this, every Bank
must be a member of the Nebraska
Banker’s Association, and your ab­
solute loyalty must be assured to any
plan they promulgate. Take for in­
stance, suppose these gentlemen de­
cided that drafts all over the state
must net the banks ten per cent per
hundred, or say they decide that banks
should drop to three per cent on time
certificates, do you realize how this
would affect your earnings and your
deadliest competitor would after all
be a real sport and make the same
changes?
Let’s get together and when you
accomplish this you will be organized
— organized to stop losses and increase
earnings. Then will banking be worth
while and both your community and
you will prosper.

33

Colorado News
Colorado Bankers Elect
The Colorado Bankers Association
which held its annual convention at
Troutdale-in-the-Pines, has elected W .
R. Armstrong of Colorado Springs
president of the organization. Mr.
Armstrong is president of the Colorado Springs National Bank and a
trustee of Colorado College.
The association urged passage of a
state law to make bank robbery a capi­
tal offense and decided to employ de­
tectives to aid in the search for the
men who robbed the First National
bank at Lamar.
The association passed the follow­
ing resolution:
“ Resolved, That the tremendous in­
crease in bank robberies and holdups
and the utter disregard of law makes
it imperative that the legislature of
Colorado deal quickly and severely
with this particular increase of crime.
“ W e request the legislature at its
next meeting,” the resolution said, “ to
enact with all speed a law making
bank robbery a capital offense.”
Denver Clearings
Denver, Colo., clearings for the first
six months of 1928 showed an in­
crease of $77,993,754 over the same
period in 1927, according to figures
made public by the Denver Clearing
House association. The total for the
first six months of 1928 is $869,964,793, compared to $791,971,039, for
the first half of 1927.
Clearings for June, 1928, showed an
increase of $8,689,509 over June of
last year.
Elected Vice-President
A. Petteys of the Farmers State
Bank of Brush, was elected vicepresident of the Colorado Bankers A s­
sociation. Mr. Petteys has been chair­
man of Group No. 1 for the past year.
niiiiiii!iiiiiiiiiliiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii!ii!iiiiiiiii:iiiiiiiiiiiiiii!iiiiiiiiu<ii|iiiiim:iiiiiiiiiiiiiiiiiiiiii


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Remodeling
The Montezuma Valley, Colorado,
National Bank is now in the midst of
a general overhauling of its banking
house which will entail an expenditure
of some seven or eight thousand dol­
lars.
The remodeling of the building will
entirely change the interior of the
bank, placing the lobby on the opposite
side of the office space from its pres­
ent position. The fine new vault will
be larger and give added protection
and convenience to those having safe­
ty deposit boxes. G. O. Harrison,
president of the institution, says that
the new fixtures will be the same
style as those used in the Denver Na­
tional Bank.

trade, have been initiated by a group
of Denver investment bankers.
It is believed the purchase price will
be in the neighborhood of three quar­
ters of a million dollars. The Chicago
and New York memberships of the
company alone are worth slightly less
than $400,000, and the good-will of
the firm, which has been operating
since September 2, 1912, also is ex­
pected to bring a large sum.

The First
National Bank
OF LINCOLN, NEBRASKA
Established

1871

OFFICERS
S. H. B U R N H A M . Ch. o f B oa rd .
H. S. F R E E M A N , P re s id e n t.
P. R . E A S T E R D A Y , V ic e -P r e s .
W . B. R YO N S, V ic e -P r e s id e n t .
S T A N L E Y M A L Y , V ic e -P r e s .
JO E L. B U R N H A M , V ic e -P r e s .
L E O J. S C H M IT T E L , Jr. V ic e -P r e s .
B. O. C A M P B E L L , Jr. V ic e -P r e s .
E. H. M U L L O W N E Y , C a sh ie r
H O W A R D F R E E M A N , A s s ’ t C a sh ier.
F R E D D. STO N E , M g r. S e r v ic e D ept.

To Change Hands
Negotiations for the purchase of
Wilson, Cranmer & Co., of Denver,
members of the New York Stock E x­
change and the Chicago board of

CAPITAL & SURPLUS
$1,050,000.00
ASSETS OVER $14,000,000.00

N A TIO N A L B A N K OF COM M ER CE
L IN C O L N ,

M.
CARL

W E IL ,

W E I L , V ic e -P r e s id e n t
B Y R O N DUNN, C a s h ie r

C a p ita l $300,000.00

S u rp lu s

NEBRASKA

P r e s id e n t
E R N E S T C. FOLSO M , V ic e -P r e s id e n t
B. G. C L A R K , A s s ’t C a sh ier

$ 1 0 0,000

U n d iv id e d

P ro fits

$100,000

m

A Complete Banking Service
The Midland Bank offers exceptional facilities for the transaction
of banking business of every description. Together with its
affiliations it operates over 240c branches in Great Britain
and Northern Ireland, and has agents and correspondents in
all parts of the world. The Bank has offices in the Atlantic
Liners Aquitania, Berengaria and Mauretania, and a foreign
branch office at 196 Piccadilly, London, specially equipped for
the use and convenience of visitors in London.
AMERICAN DEPARTMENT : POULTRY, LONDON, E.C.2

MIDLAND BANK
LIMITED

HEAD O F F IC E : 5 T H R E A D N E E D LE STR EET, L O N D O N , E .C .2

Central Western Banker, July, 1928

34

Have You Heard This O ne?
Universal Opinion
Mrs. Grubb— (after a tiff) : “ When
I married you, I didn’t know you
were such a coward. I thought you
were a brave man.”
Grubb: “ So did everybody else.”
Joyful News
A farmer became the father of
twins, and on learning the news he
was delighted that he hurried to the
nearest post office and sent this tele­
gram to his sister-in-law.
“ Twins today. More tomorrow.”
Chug-a-rum
“ Grandpa, can you make a noise
like a frog?”
“ Why, no, W illie; why do you
ask?” '
“ Well, 'cause I heard Pa tell Ma
this morning that when you croaked
we would get twenty thousand dol­
lars life insurance money.”
Her Own Medicine
H elen: “ Are you going over to the
drug store, dad?”
Father: “ Yes. W hy?”
Helen: “ Bring me back some pills,
will you?”
Father: “ What’s the matter with
those that have been calling on you?”
The Real Question
W ife : “ Do you know that 3-011
haven’t kissed me for six weeks?”
Professor (who is absent-minded) :
“ Good heavens, whom have I been
kissing, then?”
Painters Please Note
Jack: “ Say, Gus, what is this steel
wool I hear so much about?”
Gus: “ I ’m not sure, Jack, but I
think it is made from the fleece of
lwdraulic rams.”
Rapid Transit
“ You probably don’t remember
me,” began the self-made man
proudly,, “ but twenty years ago when
I was a poor humble boy, you gave
me a mesage to deliver.”
“ Yes, yes,” cried the busy man,
“ where’s the answer?”

A ccom m od a tin g !

Today’s Pace
Husband (who has married a
cinema star) : “ If I should die would
}^ou marry again?”
His Beautiful W ife: “ You funnv
man. What gives you the idea I ’ll
wait for that?”
Quick Trip
Testy Old Gentleman (to his but­
ler) : “ What made you so late?”
“ I fell downstairs, sir.”
“ That ought not to have taken you
so long.”
Silent Motor
Very Pleased Motorist: “ See that!
That’s showing how silent she is—
almost got that chap before he knew
we were on the road!”
Confessions
Father (to youngster, just put to
bed) : “ Now what are crying fo r?”
S on : “ I wanta drink.”
Father: “ So do I ; go to sleep.”
Pulling a Sneaker
“ There now, you’ve gone and or­
dered flower seeds that take two years
to bloom.”
“ You mind your own business,
Hiram, this is last 3'ear’s catalogue.”

A Full Calendar
“ Why did you rob this man in
broad daylight?” inquired the judge
of Sock ’Em Simpson, who had fin­
ally been taken into custody.
“ Well, your honor,” said the pris­
oner soothingly, “ I regret the fact
that is was so unconventional, but it
so happened that I had engagements
for each night this week.”

TH E C E N TR A L W E STE R N B A N K ER OF O M A H A , P ub li sh ed

by

He Was Over-Stopped
An Eastern motorist in Oregon ar­
rested for running past a stop sign
gave a novel excuse, as follow s:
“ Why, ding it, I’ve stopped at
every sign since I hit this burg.
I
stopped at signs that said ‘Stop’ be­
cause I thought they were traffic
signs, but turned out to be ‘Stop, buy
real estate,’ 'Stop and eat here,’
‘Stop and buy apples,’ or whatever
it was those babies had to sell. I’m
a stranger here and I ’d wheel around
a corner and there’d be a great sign
hollering ‘Stop,’ so I’d grind brakes
and when we got stopped I ’d see it
was just another ad.
So I hustled
along and that’s how I came to miss
a real stop.” The judge liked this ex­
cuse and permitted him to go with­
out a fine.
A Bible Story
A small urchin in a Belfast slum
Sunday school was asked to tell the
story of Daniel in the lion’s den.
He began eagerly: “ Danny was
thrun into a dan o’lions. There was
lions ivery side ’av’him and lions
ahint him, and a mortial big lion forninst him. And”— with immense gusto
— “ there was wee Danny in the mid­
dle, not carin’ for anny o’ them.”
Wanted: A Pink Tomb
The Japanese are rapidly assimilat­
ing American business notions, but
they have not quite divested them­
selves of Oriental extravagance of
expression, as this personal adver­
tisement from a Toyko newspaper
will testify:
“ I am a beautiful woman.
My
abundant, undulating hair envelopes
me as a cloud. Supple as a willow is
my waist. Soft and brilliant is my
visage as the satin of the flowers. I
am endowed with wealth sufficient to
saunter through life hand in hand
with my beloved. Were I to meet a
gracious lord, kindly, intelligent, welleducated and of good taste, I would
unite myself with him for life, and
later share with him the pleasure of
being laid to rest eternal in a tomb
of pink marble.”

D e P uy

P ublish ing

Company

416 Arthur Bldg., Omaha, Nebraska
C l iff o r d D e P u y , Publisher

G erald A. S n id e r , Associate Publisher

R. W . M oorh ead , Editor

Wm. H. Maas, 1221 First National Bank Building, Chicago, Vice-President

Central Western Banker, July, 1928

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PT. IP. H a y n e s , Associate Editor

mt
Cfcaée Rational iBank
of the City of New York
57 BROADW AY

HOTELS OF
HOSPITALITY

___________________ $ 50,000,000.00

Capital_______

Surplus and Profits------------------------

OMAHA

OFFICERS
Albert H. Wiggin
Chairman of the Board

Hotel Fontenelle
L IN C O L N

Hotel Lincoln
S IO U X

John McHugh
Chairman of the Executive Committee

C IT Y

Hotel Martin
C E D A Ii

Samuel H. Miller
Carl T. Schmidlapp
Reeve Schley
Sherrill Smith
Henry Ollesheimer
Alfred C. Andrews
Robert I. Barr

R A P ID S

Hotel Montrose
S IO U X

FALLS

Hotel Carpenter
And in
Los Angeles,
Hotel
Alexandria
$2 Up.

fo r

Your

o th e rs
C o m fo r t

Vice-Presidents
George E. Warren Hugh N. Kirkland
George D. Graves
James H. Gannon
Frank O. Roe
William E. Purdy
Harry H. Pond
George H. Saylor
Samuel S. Campbell M. Hadden Howell
William E. Lake
Joseph C. Rovensky
Charles A. Sackett

Second Vice-Presidents
Frederick W. Gehle Franklin H. Gates
T. Arthur Pytermas
Edwin A. Lee
Arthur M. Aiken
Ambrose E. Impey
Alfred W. Hudson S. Frederick Telleer Robert J. Kiesling
James L. Miller
Otis Everett
Lynde Seiden
Benjamin E. Smythe Wm. H. Moorhead Thomas B. Nichols
Joseph Pulvermacher Harold L. Van Kleeck George S. Schaeffer
Leon H. Johnston
Comptroller
Thomas Ritchie

Hotel Chieftain
:m<l E L E V E N

Robert L. Clarkson
President

Vice-President and Cashier
William P. Holly

C O U N C IL B L U F F S

O p erated

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Deposits (February 28, 1 9 2 8 )------- 857,757,013.97

by

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Federal Reserve Bank of St. Louis

Kansas City, Missouri

TU RN


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Federal Reserve Bank of St. Louis

This month we celebrate our 62nd birth­
day. These years are but the span of a
man’s life-—yet what wonders they have
worked! The sprawling frontier village is
now a metropolis. From small shops great
institutions
have
grown.
Skyscrapers
tower where once were humble homes.
Important in Omaha’s progress has been
the influence of The Omaha National Bank.
Here our pioneers brought their deposits
for safe keeping.
Here our young men
came for aid and counsel. W ith kindly

service and seasoned judgment our ex­
ecutives have helped to build the city of
today.
On such a foundation we are buildiug now
for tom orrow ’s prosperity. Our efforts are
dedicated to that purpose. W e offer Omaha
complete financial service. Here the busi­
ness men of today— and the young men
who will be leaders of tom orrow— will re­
ceive the same measure of service, sup­
port and counsel which has been so vital
an element in the development o f Omaha
and Nebraska for the last 62 years.

Omaha
Bank