Show - ! How All the People Played a Part In Building Nationys Credit Structure Banker Describes the Way Loans and Securities of Banks Are Based on the Hopes and Plans of AH Classes— Values Dependent on Public’s Ability to M'iet Obligations By TRANCIS Preiident American Bank( r be informally described CREDIT may hopes plans and good in pur converted Into present tentiona chasing power The the manu farmer acturer the mer chant the homo the- - purbuyer chaser of household goods the Investor and the speculator all borrow at times They plan to repay with the earnings of their crops proceeds of the sales of their goods comes from their vsages and salaries or profits from the resales of their enhanced market values securities at tach as the case may be The greater part of these various forms of credit Is obtained by the borrowers directly or Indirectly through the expansion of the loans and Investments of the banks It is this which and mortcreates the notes securities gages la the portfolios of the banks The banks are able to extend these loans because a great many people posit money with them the Even under the best conditions of borrowplans of a small percentage ers go wrong through mistakes hard luck or dishonesty and the judgment of the banker in such cases Is proved by the after event to have been at fault The losses caused under such conditions are ordinarily fully met by funds set aside 6ut of the earnings of for just this purpose and do not affect the money of the depositors ho seldom - hear anything about such losses in the vast majority of cases and In the overwhelming volume of business Involved the confidence of the bankera In tbelr customers and the confidence In of the customers tbelr own ability to carry out their plans and obligations to successful conclusions are wholly This Is the normal economic justified situation rnd It constitutes the condl tlons under which the use of credit adds to public welfare and progress The Faith of the Banks Such was the structure of hopes good intentions and common confidence In one another that existed among all classes of the nation’s community life when the series of economic shocks began to shake the nation’s social in 1929 The people had deposited billions of dollars with the banks be cause they had confidence in them The banks had loaned large volumes of these deposits on farm and home mortgages and on notes cf manufacturers business men and finance concerns and bad Invested In tb( standard securities of the nation's corporations state and local governmental units and the national government itself because they had confidence in the citizenship and business condition of the nation Tbelr mortgage and other loans to owners of farms aggregated $6500000-00Loans on urban real estate were Loans to Individuals se$4000000000 cured by U S Government municipal and corporate securities totalled $11 Loans to Industrial and 000000000 commercial In connection enterprises with the production and distribution of the nation's Infinite varieties of goods amounted to almost $19500000000 Investments In Federal State and municipal bonds were almost $6000000-00and in various kinds of railroad and corporate securities $11000000000 These made total loans and Investments of $58000000000 This great credit structure was built while tbe country was at peace while the farms and factories were productive while the nation and the world provided great active markets for their outputs while the earnings of all kinds ’of enterprise were large while the U SISSON Association The T orum were puip'e cf tie nation working a es a id sa while fully emplojcJ arles were steady and generous while and prices oT commodities were strong were while the minds of the people dominated by faith In the futnie and confidence In one another in Great Change Came to the Nation almost as If the sun Then suddenly lost part of Its vitality Foreign markets changed failed and disappeared Industry slackened A rapid drop in all kind of commodity valuer set In The earnings of develfell business Unemployment Wages and salaries went down oped markets shrank Fear beDomestic The securities markets came general as tbe prices of became stocks and bonds withered to fractions It was the of their former values greatest disintegration of human plans economic conditions and worldly witnessed ever values that history had These destructive changes cut right through the qualities and values of the the notes and loans and Investments securities In the banks Business men and manufacturers could not repay their notes to the banks as due Many units and corporations governmental defaulted the payments on tbelr bonds Property underlying real estate became worth less than the fac The market values of the mortgages of Btandard securities became less than the banks had paid for them as Investments or accepted them at as collateral for customers’ loans This meant In flue that the ability to carry out the future of borrowers hopes plans and good Intentions that I have defined above as tbe basis of had become credit impaired to a far greater extent that had ever before occurred In the nation's history The resulting losses could not be absorbed by the banks alone out of the normally ample funds that had been set aside against the expectancy of a certain Inevitable percentage of human plans gone wrong Itself had everything Bank Showed All Reasonable Care was la loans and Investments values thus became so Impaired that the banks In all confidence In all good faith In all care and good humanly reasonable had entrusted tbe billions of Judgment dollars of deposits which their customers had entrusted to them Those loans and Investments were under all normal conditions a good as Indeed if the banks Ingold itself stead had filled their vaults with gold bars and then some unknown cosmic ray had transmuted them into lead tbe results would have been scarcely more startling than the depreciation that was caused In tbe assets of the banka economlo forces by the unforeseeable which permeated and debased them The inevitable result was that when the banks urgently needed the money they had entrusted to those assets so that they could meet the unreasoning demands of tbelr depositors they could not get it back It was not that our banking system and methods were of themselves weak or reprehensible apart from the rest of the life of the nation as has so much been made to appear It was not that our banks were peror dismeated with incompetency or with lower standards of honesty business ethics than were tba other forma of human activity with which their own fate and activities were Inas U almost extricably Interwoven seemed at times there was a concerted national conspiracy to lead our people to believe Tbe great fact o( American banking la that It shared fully in the plant and hopes and hazards of the American peothose when ple— and plans went the banks carried their share wrong of the burden and suffered their share of the misfortune East Tremonton Mrs M Comeilson of Bancroft Ida ho was a guest of Mrs Charles Peterson Monday Mrs O A Seager spent the fore daughpart of the week visitingof her Balt Lake ter Mrs Harry Purse UTAH GARLAND TIMES THE GARLAND Oscar id his Monday Jones aunt of Balt Ms Q King Lake City visit L Brough on inative mount' and Dr at Logan A F Fridal and family Verne Fridal spent Monday canyon Ervine Jones and childen ba and Murray left for Provo urday and will visit for a few with relatives Ms CONTEST LAUNCHED Farm Success E Cache county Utah bankera cently added a stimulus tu - ' i re- cooperative work by launching a farm accounting contest At a meeting of the Clearing House Association the was put before the bankers and project methods and plans formulated Each bank in the county agreed to enroll a minimum of five farmers in The the farm project accounting names of tbe farmers when enrolled will be sent to the Secretary of the Clearing House and also to the ExDivision of tbe Utah State tension The bankers Agricultural College agree to cooperate and keep in close touch with each farmer they enroll so of a maxiat to Insure the completion mum number The bank which succeeds at the conclusion of the contest in enrolling the largest number of farmer completing the project will be glvea a special recognition at the lag the ' a Vacation weeks Ask "Long any rates to know you Distance" you would for tike SUMMER In A L CANDIES ( ig l l l i KONG” WILL EXPERTS 'Kiiiiniiiiuiiiiiiiiiwuiit QUART ICE CREAM — All Flavor PINTS 2 BAFFLE aii m i!iiiiiiiiiiiiitii iiiimiii in"iua CH EWS £SS Mr and Mrs C Toone and daughter Leah of Pleasant Grove and Mr of Manteca and Mrs Zelf Erickson weie guests of ifr and Mrs O L Biough last ednesday Mrs George Abbott and Mrs Jane Abl'ott were hostesses to the Ladies afternoon at Farm Bureau Friday the home of Mrs Geo Abott After a and social shoit business session hour the Misses Rue and Katherine luncheon a delicious Abbott served i i i i i i i i WRAPPED CANDY Mrs Venna Haklo and children of Price Mr and Mrs Lewes Dodd and George Brough drove Mr and Mrs to Providence Thursday and spent the day visiting Mrs Clara Kelly ‘KING THE MOUNTAIN 8bop PE Cl S S Garfield and son Irvine Lake visitors Monday Dr Verne Fridal of Los Angeles visiting relatives ere this week1' This is the time of year you The get the urge to travel astelephone can be of great calling sistance to friends In towns ahead tell them you’re coming call lng ahead for road information and arranging accomodations or calling back home to keep in touch with the folks or the office to J Salt three alter skillfully Warren Wright and children of Salt Lake City are visiting this week with her sister Mae Fridal and Dr Verne Fidal brother Mrs were the Para- did the producers and directors maneuver "King Kong" is as tall as a four story building about the streets of New York? who Mrs NOW for the for a at How so Sat- point they are aa silent as Sphinx but their alienee does not the Met that "King Kong” fe the screen’s greatest novelty to date and it la doubtful if It will ever be surpassed as a production mindly On th$ and amazing starting Theatre Saturday day run Mel- 20 35 FOR PECK PREDICTS STATES TELEPHONE AND TELEGRAPH CO “King Kong’’ Who is he? What is he? How were the scenes filmed? These and a hundred Questions are have seen being asked by persons who Blue Bell Confectionery i It mGnSJlORJO you HOWthah even bcforc ftv 1 At today's low prices the investment value of Electric To (he Servants Is greater than it has ever been who desires to have something tangible beneficial1 and of lifetime service there is nothing more attractive banks of Cache county have agreed to subscribe to an award fund which will be presented to five winners as follows: first prize $15 00: second prize $2500 third prize $20 00 fourth prize $1250 fifth prie $7 50 Recognition lor Good Farming In addition to the cash prizes every farmer customer enrolled who scores sixty per cent or more will be awarded issued by the a special certificate Clearing 'louse Association and tbe Extension Service jointly In cooperation with the Agricultural Committee of the Utah Bankers Association The scoring will be done on the following basis: Farm and home account record 50 and complete) (accurate a Success of year’ operation brought out In the summary of 25 the year’s bnslness of farm and General appearance sird condition of improvements livestock ant to he done during the summer 25 'months) The contest will end December 31 The judges wilt be tbe County 1933 Agent the County Key Banker a representative of the Clearing House Asand two representative sociation lacted by the Extension Division ol the College C Cooking and Electric Refrigeration not only add materially to the joy of living bat pay substantial and continuous returns in the cost of the food you save Electric Water Heating provides still another step toward complete home enjoyment t Electric i In addition to the present lower Initial investment you also secure the benefit n rate of a very reasonable operating cost through our combination which decreases as your use of electricity increases ' - Banker Evolve Plan for Stimulating Important Aid to Kong” whose Tbe FARM ACCOUNTING I " costs are increasing indicates an early upward trend in price Now is the time to invest in a Hotpoint Electric of the finished products Range a General Electric Refrigerator and an Electric Water Heater or at home least one of these appliances as a start toward your Material which Take advantage of our easy payment budget plan or if you desire Cash purchase a liberal discount brings you a still greater saving " to make a u V al " tell you more about the It will be a pleasure to give you comnlel" '‘nfriulion and you no way Lc oLIiauid i’iioiie us r "S O— May we idea? will-in-- t y : EFFICIENT is s UDLIC SERVICE Mi © V" |