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Show A Country Editor Looks at Banking LOS ANGELES. While the Idea of the guarantee of bank deposits by some legally enforced plan seems to appeal to many people who give It casual thought, the fact is that It has not only failed in every Instance in the eight states where the experiment was tried, but ac- ' tually produced unsound banking and increased the number of failures, fail-ures, it was declared by the recent convention of the American Bankers Bank-ers Association held here. "Guaranty of bank deposits carries car-ries an idea that naturally appeals tr nAnnlfl In trAiieral nn casual con- sideration," the declaration said. "However, In principle It Is unsound and in practice It Is unworkable. It has been tried In eight States and It has not only failed In every case, but It has resulted In Increasing Increas-ing the number of bank failures. Taxing properly managed banks to make up losses of failed banks is not only unfair and unreasonable, but,, it weakens the whole banking structure. Again, guaranty of deposits de-posits places the Incompetent and reckless banker on an equal footing foot-ing with the able and conservative hanker, which encourages bad banking bank-ing at the expense of sound banking. We are therefore opposed to the passage pas-sage of any law carrying a guaranty of bank deposits and believe that it is against the Interest of the people peo-ple of the United States to develop zny such system." |