Show I M Loans Show Shove Prosperity 1 uch Business and Savings De Deposits posits Are Indications of Ability Ability Ability Abil Abil- ity of City to Withstand Pre Present nt Stagnant Industrial In Industrial Industrial In- In Conditions r Pr P f PREPARED FOR INSTITUTE Pursuant to the thA th purposes of ot th the merican Institute of or Banking Banking- in eking Its Us members member to write i e educational uca- uca n lonal papers treating of ot financial litters the following paper per was as IUen itten and prepared and submit submit- ted I 11 to Salt Lake chapter A. A I I. I B. B ky y Frank BeckwIth man manager ger of or the loan can onn department of ot Tuttle Bros Co j he The rapidity In exchanges of the thc medium Indicates the do dote dote dote do- do te of briskness of ot trade lar largo c clears dear clear i s show activity on the othor other hand hen rhen times are hard business de- de eased ased and everything dull as asT y T now are and with the flow of ot ecks s through the house clearing sluggish there yet ct remains I Ie Indicators of or the steady y growth of or orIf e If city two factors namely savings ks deposits and the mortgage loan lonn That there thero Is 18 a a. stead steady current o of i asperity In the tho city as a whole Is needed even In the face ace of ot tho prest pres- pres I ht t stagnant condition oven Q If It trade does not show It In the tho clear clear- the usual place we wo should look those ose channels of the financial most used when general trade trado achy ae ac- ac- ac Ity hy IB le dull And that channel used all classes alike both wage earner is d business man Is deposit In sav- sav banks banks' and lending mone money on real realto ite to mortgages rno he be man of ot means turns first to toI I 1 estate mortgage loans loana when his sues of business will wUl not absorb his hisIng Ring owing surplus either cither placing his ss liS I himself or purchasing them from brokers If It he e docs does not ot care to able with their management and deposits his excess funds in savings banks at a lower rate of Merest terest If It he cannot place real estate estate- is II e enough Tho The wage earner when ts tighten begins begina a savings ac- ac ant nt at as an an anchor to leeward leewar against ed d of ot ready coin The dull ull times r ro TO been with us now for over two ir r rs and the city's steady stead advance to asperity Is unmistakably Indicated these two sources under m. m s. s Situation In Salt Lake Let Lri us examine this situation In Salt ko ice as to the following points How Euch uch available cash in excess of trade cd eds has been absorbed by invest invest- t In mortgage loans How much ye ve the savings banks deposits inre in- in re eased sed And closely following these ro o Indicators of accumulations are arc terest rates lower because of moro more oney ney seeking Investment Mortgage aSe is taken s locally take up the surplus om oin two to sources individuals busies busi- busi IS es men and capitalists capitalists and savings inks tho tho latter getting their means take tako mortgages ages from a double Ulce namely business men mon and lye re Consequently a no stud study present condition of ot savings I inks and tho the mortgage marts loan situation rill ill III quite tull fully cover all classes ons on's Savings Bank and Trust company reports savings of ot September 1912 greater than January 1912 91 Savings bank 5 alker Bros Bankers sav- sav ingo department Tonal lanaI Copper bank mental National bank of ot S savings Indicating of savings s Indicating financial accumulations urther Further every bank In the city both and savings report a largo large uh b hi reserve and evor every mortgage loan is advertising for borrowers pat at they may reduce their surplus Front January 1 I 1912 to September 1112 the county count records show that were absorbed by local n s for and that during s samo period borrowers were able ablo ha e nave have cancelled from the records or that borrowers paid off riser inner loans to within of ot the total written In a growing STowIng city ex- ex x- x of ot largo business blocks th the e money for or which was lar largely ely borrowed borrowed borrowed bor bor- rowed from eastern castern sources and the growth of ot that city demanding so BO much to meet Its needs On One might expect would show that a cons congested ste l money market markot more mortgages l can cancelled than written but this could hardly be so cause because only those mortgages were cancelled that could be pal paid this Year r It speaks highly of f the economic condition con con- uit of ot on the community when cancellations cancel cancel- lations run within loss than of ot tho the amount written exclusive of ot certain mortgages representing permanent permanent perma perma- nent investments by public spirited citizens building for tor the future this indication of ot further prosperity Is 18 shown In the following Walker Bros Bros' Interests S Louis simon P. P J. J Moran Peer Peery Hotel company company Bauer Holding company company Ut Utah h Hotel company campan I Highland Imp company Loan on the old Go Godbe be Pitta Pitta Pitts corner a par a t men nt t loans grouped Funds borrowed largely ol from cast east That Is the tho mortgage loan records show that Salt Lake demanded mortgage mortgage mort mort- gage loans for tor Im Improvements to the total to total to- to tal sum Bum of ot and as mortgage loans are aro usually based on a 50 60 per cent valuation of ot tho the property then improvements during the last nine months indicate about less whatever renewals of loans may bo be Included in included included in- in In those totals and as cancellations cancellations cancel cancel- lations approach so closely to the sum written tho the renewal loans will not be large From Juno 30 to September 17 cancellations actually exceeded the amount written by Five l Million Locally Local firms took mortgages approximating I five lve millions and big projects required two and three quarter millions mil mil- lions in excess of that that and and local funds not exhausted by that drain figures speak volumes of at the financial strength of ot this city Why do wo we find these conditions In Inthe Inthe inthe the mortgage loan situation 7 And Under under un un- der what circumstances will they right themselves ves The local congestion of ot money available for tor mortgage e loans Is largely brought about by these theBe factors factors fac fao- tors In May 1910 there came ClUne a a. the flurry flurry the Heinze copper fight was on and all mining stocks dropped p the tho real estate market busted toe tho rice of ot otwool wool and livestock next followed followed b by dropping the commercial banks tightened tightened tight tight- ened up and a four fold squeeze succeeded suc sue The first effect of ot all this was to force every person financially embarrassed em em- I to cover by a real estate loan because the commercial banks would not nol carry themselves calling In loans Hence Bence savings banks Were given Iven the opportunity to loan as close close- closely ly to their reserves as they deemed advisable and mortgage loan companies companies companies compa compa- nies not being compelled by law as banks s are to maintain a reserve loaned not only their own funds but a as aa much more as their credit allowed Then with continued hard times and depressed business conditions came the second effect that is 18 Is merchants and other business mon man found their trado trade so EtO inactive that It did not Invite tho the Investment of ot their surplus earnings In their own business and In order to get Jet any returns from such idle funds they were compelled to take tako low mortgages cs on real estate and wage- wage earners combined with business men mento mento mento to build up deposits available for tor mortgage mortgage mort mort- gage loans This condition of ot extended business depression has been on for two years and at this writing mortgage loan companies have sold all the loans they held in stock savings s banks havo have plenty of ot money to loan and the need of the present hour la is more borrow borrow- ers Individual Investors In mortgage loan companies and savings saving's banks bonks today are looking for loans Interest rates aro lower than In 1909 and 1910 To answer that will correct these conditions we will say that when trade Is 19 again active and merchants and business mon men can expand using every cent they can raise for development and growth when mining Investments again appeal whon livestock comes comesup comesup comesup up in price which it Is now doln doing when real estate shows actual profit In tn speculation or fair returns for tor In Investment Investment Investment In- In vestment and lastly whon when tho the po political political political po- po If thunder forgers let us settle our thoughts on business then will conditions tend to bo be normal bank clearings grow lar larger er and Instead of the present complaint The country Is just glutted with with money the cry will willbe willbe be again What the west needs Is Ismore ismore more money for Its development |