MR. BANKER: I said one-sixth for the country bank. The average reserve held by all the National Banks is 20 per cent, not 15 per cent. So that the unnecessary cost to the people of our present United States Notes and bond-secured Bank Notes is five times as much as it should be, or we are losing every year $53,000,000, every dollar of which must come out of labor. MR. MERCHANT: Now, let me see whether I understand this matter correctly; to illustrate, let us suppose that your bank needed today $1,000 more currency than it has on hand to accommodate a customer. You would have to go out and buy it, and pay $1,000 for it, or obligate your bank to do so. With interest at 6 per cent it would average $60 per year to carry it, but if you could exchange your bank's notes, amounting to $1,000, for your customer's note of $1,000, and carry a reserve against your bank notes outstanding of say 20 per cent or $200, and interest is at 6 per cent, it would cost you only 6 per cent on $200, instead of 6 per cent on $1,000; or you would make a saving of $48 on the $1,000 of currency. Am I correct in my understanding of the difference of cost upon these two forms of currency? MR. BANKER: Yes, you are absolutely right. No one could state the principle better than you have. MR. MERCHANT: Well, then, it is clear, that if there is a saving of $48 a thousand on $1,100,000,000, we are wasting annually on that one item alone $52,800,000. MR. MANUFACTURER: But, gentlemen, let me call your attention to another fact. This country is losing several times as much as that every year on the average, because of our present rigid form of currency. Just as soon as there is any fear anywhere in this great country about a bank of any consequence, or about the business generally in the country, every banker from Dan to Beersheba begins to grab currency in whatever form he can get it, because he knows the amount is fixed and limited. It is not nearly so much a run on the banks by the depositors, as it is a run by the bankers on each other, just to accumulate cash. Everything comes to a dead stop, just as it did in 1907, and it always will under present conditions. Now, it seems to be perfectly plain that if the banks could convert their book credits into note credits, they could immediately meet the demand for cash, and so avert these commercial catastrophes, which set us back years. You know we are just now beginning to realize that we are getting over the panic of 1907. Gentlemen, instead of the panic of 1907 costing us $53,000,000 a year, it costs the people of the United States more than ten times as much as that every year. God only knows what these commercial tragedies mean in the life of a nation like ours, and it is up to us to prevent them, if possible, and it must be possible. It looks to me as though Mr. Banker was on the right track.