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BETWEEN THE LINES
BY S. NOEL
At the last convention of bankers it was authoritatively stated that in more than 95 per cent of cases "runs on banks," those mad rushes of depositors, moved by the psychology of the mob, to withdraw their savings, are made upon perfectly sound and solvent banking institutions, and are caused by some stupid rumor. Last week a run on the Miners' Bank of West Hazleton occurred through the misinterpretation of the periodical statement of that institution in which the usual statement of resources and liabilities was recapitulated and the balance shown under the statement "at the close of business," which phrase led someone to believe that the bank was being closed.
Some years ago a run was made on a Wilkes-Barre bank through a similar stupidity. On a rainy Saturday night a group of people stopped for protection in front of the local bank, and the crowding forced the front door open. The night watchman closed the door against the crowd again and the affair was over until next morning, when a mob of depositors formed a cue to withdraw their deposits.
In most instances banking institutions are ready for such an emergency. In the latter instance every depositor was paid off in gold, and in three days most of the amounts withdrawn were redeposited.
It is characteristic of the American people to accept rumors too readily. Runs on banks are easily taken care of. But how often are these runs made on people's characters, silent runs which cannot be overcome with a show of gold, founded as often on rumor and more devastating than those upon financial institutions.
An officer of the local institution which was the victim of a "run" relates that several days after the mob was successfully met, an old depositor came to the window to withdraw a part of his account to pay a note at another bank. The teller inquired why he had negotiated a loan when he had such large funds on deposit in that institution and the explained that he needed the money at the time of the "run" and did not want the officials to believe that he was among those who credited the silly rumors of insolvency. How many characters might be saved from assassination if everyone assumed this stolid confidence in his fellow-men
Was it Daniel Webster who, speaking of this state (Massachusetts) said: "There she stands and there she will stand forever?"—From an editorial in the Sunday Independent.
No Daniel Webster said: "There she is. Behold her and judge for yourselves."
