MR ROOSEVELT'S POLICY.

Southland Times, Issue 22011, 10 May 1933, Page 7

MR ROOSEVELT'S POLICY.

To the Editor. Sir,—ln dealing with this matter the Southland Times recently made the position no clearer, and although there are many points in that leading article one would like to deal with, still there is always the amount of space necessary to be considered. As to. whether or not Mr Roosevelt’s policy is selfish depends on the domestic conditions obtaining in the United States, and also the policy persisted in by those nations which consider it so. To say that Mr Roosevelt and the Congress have shown that they are adverse to cancellation or to any modification of war debts arrangement does not saddle them with all the responsibility for the war debts not having been cancelled. If all the facts were known I would say as much objection exists in certain quarters in Britain as exists in America. You say Mr Roosevelt is not an opponent of the Federal Reserve Bank System, yet the fact remains he took over the whole control and although it came into being in America during the term in office of Mr Woodrow Wilson the passing of the Federal Reserve Bank Bill through Congress is common knowledge. That one of the results of the banking crisis in the United States is “the determination to extend the ‘influence’ of the Federal Reserve Board so that there will be fewer opportunities for wild cat banks to lose money deposited by the public.” That is the principal statement I wish to deal with. The first part of that statement is answered by pointing out that the prosperity of that country deuends entirely upon whose “influence” the Federal Reserve Bank is going to extend. Is it the peoples or the financiers? The small wild cat banking system, as termed by the Southland Times, requires some explanation. Who was responsible for it? The National Banking Act, referred to by your paper as a small wild cat system, was piloted through Congress by John Sherman in 1863. From 1863 to 1900 there was scarcely a great financial measure in U.S.A with which the name of John Sherman was not connected. . The following letter between Rothschild Bros., and Ikleheimer, Morton and Vandergould will explain the wild cat system of banking in U.S.A. From: Rothschild Brothers, Bankers, London, June 25, 1863. To Messrs Ikleheimer, Morton and Vandergould, No. 3 Wall street, New York, U.S.A. Dear Sirs,—A Mr John Sherman has written us from a town in Ohio, U.S.A., as to the profits that may be made in the National Banking business under a recent act of your Congress, a copy of which act accompanied his letter. Apparently this act has been drawn up from the plans formulated here last summer by the British Bankers’ Association and by that association recommended to our ■ American friends as one that, if enacted into law, would prove highly profitable to the banking fraternity throughout the world Mr Sherman declares that there has never before been such an opportunity for capitalists to accumulate money as that presented by this act, and that the old plan of State banks is so unpopular that the new scheme will by mere contrast be more favourably regarded, notwithstanding the fact that it gives the National banks an almost absolute control of the national finances. “The few who can understand the system,” he says, “will either be so interested in its profits, or so dependant on its favours that there will be no opposition from that class, while on the other hand, the great body of the people, mentally incapable of comprehending the tremendous advantages that capital derives from the system, will bear its burdens without complaint and perhaps without even suspecting that the system is inimical to their interests.” Please advise us fully as to this matter and also state whether or not you will be of assistance to us if we conclude to establish a National Bank in the city of New York. If you are acquainted with Mr Sherman (he appears to have introduced the National Banking Act) we will be glad to know something about him. If we avail ourselves of the information he furnished we will, of course, make due compensation. Awaiting your reply, we are, Your respectful servants, Rothschild Brothers. The reply was as follows:— Ikleheimer, Morton and Vandergculd, Private Bankers, Dealers and Brokers in Stocks and Bonds and Gold and American Agents for the Investment of English Capital, No. 3 Wall street, New York, July 5, 1863. Messrs Rothschild Brothers, London, England. Dear Sirs.—We beg leave to acknowledge the receipt of your letter of June 25, in which you refer to a communication received from the Hon. John Sherman, of Ohio, with reference to the advantages and profits of an American investment, under the provisions of our National Banking Act. "The fact that Mr Sherman speaks well of such an investment, or of any similar one, is certainly not without weight, for that gentleman possesses, in a marked degree, the distinguishing characteristics of the successful modem financier. His temperament is such that whatever his feelings may be they never cause him to lose sight of the main chance. He is young, shrewd and ambitious. He r has fixed his eye upon the Presi- ’ dency of the United States, and is J already a member of Congress. He ! rightly thinks he has everything to ‘ gain both politically and financially ? (he has financial ambitions too>, by 1 being friendly with men and insti- 1 tutions having large financial re- 3 sources, and which at times are not ' too particular in their methods, J either of obtaining governmental aid, j or protecting themselves against un- 1 friendly legislation. We trust him 3 here implicitly His intellect and * ambition combine to make him ex- J ceedingly valuable to us. Indeed, we J predict that if his life is spared, he r will prove to be the best friend the,,

monied interests of the world has ever had in America. “As to the organization of a National Bank here, and the nature and profits of such an investment, we beg leave to refer to our printed circular enclosed herein. Inquiries by European capitalists, concerning this matter, have been so numerous that for convenience we have had our views with regard to this put into printed form. “Should you determine to organize a bank in this city, we shall be glad to aid you. We can easily find financial friends to make a satisfactory directory, and to fill any official positions not taken by the personal representatives you will send over. Your most obedient servants, Ikleheimer, Morton and Vandergould. The first letter shows that Rothschild Brothers thought that the wild cat banking system was first formulated by the British Bankers’ Association the summer before. The circular mentioned in the last letter sets out the conditions under which those banks were set up, but it is too lengthy io include. I may write another time and place, the connecting links between the British Bankers’ Association, the Bank of England and the Federal Reserve Board, showing the necessity for American people, if Mr Roosevelt proves to be the man he appears to be, of giving him a free hand to pursue the policy he desires.—l am etc., NORMAN McHTTYRE.