The Evening Star. PUBLISHED DAILY AT FOUR P.M. Resurrexi. SATURDAY, APRIL 28, 1883.
_:.,.,.-.. —♦— —. ■■.-../■.- .-: Banbmbaiance time is generally a terrible one for many traders ; " the spider and the fly " business was never more clearly exemplified than is usual with many unfortunates who get within the meshes of the wily banker's net. The New Zealand correspondent of the Australasian Insurance and Banking record writes: — "Notwithstanding the anticipations of the beginning of last month, the money market has been of late very tight, and considerable pressure bar been exercised by most of the local banks. The fact is that they have been overtrading, for though it is the custom to saddle the merchants with that particular sin, there is no doubt as trade is carried on that the banks are fellow offenders. It is the : banks at any rate who are in the main responsible for the extreme ebb and flow which mark the local market of this colony. In the desire to use all their funds they go very near low-water mark, and then be* coming uneasy, severe pressure is applied to their customers. Complaints are loud I and continued of this just now, and Per' haps with more real justification than is sometimes the case." These remarks will I be unanimously coincided in by not only ;the merchants spoken of by the corres* pondents, but by business men of all trades and callings. The Banks do not recklessly advance money to their customers, but they allow them to overtrade and speculate as they will, while they see an asset available to cover the liability ■of the debtor to them—which as a rule they have secured in one way or another— and so soon as they deem it expedient from their point of view, quite urespec-. tive of the result to those customers upon whom they really exist, they " put on the screw" and the unfortunates have in many instances to succumb, when a meeting of creditors reveals the fact that the assets are all swallowed up by the Bank, and the remaining creditors go lamenting. Certainly the tradesman can be accused of " outrunning the constable " in such a case, but the bank's eagerness to get its money out, and its action when called upon to replenish, its coffers, lays it open to the charge of over-trad ing to quite the same extent as its customer [cau be accused of. The way in which men commencing business are encouraged to follow up sanguine ideas as to trade extension and speculation is extremely reprehensible, and banking institutions have a great deal to answer for in cases of the inability of their customers to meet their engagements when suddenly called upon to do so. Failures consequent on such practices as we refer to very considerably cripple legitimate commerce, both by allowing men of straw to operate amongst their sounder mercantile brethren —who eventually suffer—and in lessening the credit of colonial traders in Home and Foreign markets. It may be argued that the Banks should . content themselves , with watching their own interests—which they invariably., do, but their duties do not end here. They are in possession of immense power, and very frequently occupy positions of important trust, and while admitting that the | self-preservation idea is only human, it may be contended that any advantageous position they may secure should not be used to the detriment of those, from whose body they not only draw their means of existence, but who, in the majority of instances, repose a confidence in them which ought not to be abused.
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Thames Star, Volume XIV, Issue 4466, 28 April 1883, Page 2
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591The Evening Star. PUBLISHED DAILY AT FOUR P.M. Resurrexi. SATURDAY, APRIL 28, 1883. Thames Star, Volume XIV, Issue 4466, 28 April 1883, Page 2
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