Statement on the Hoarding of Currency

THE PRESIDENT said:

"The Reconstruction Finance Corporation, under the leadership of General [Charles G.] Dawes, Chairman [Eugene] Meyer, and its Directors, is now initiating a definite campaign for reconstruction and recovery. I am gratified that the very act of creating the Corporation has already shown results in the dissipation of fear and the restoration of public confidence, as indicated by the fact that recently we have had on balance no increase in hoarding of currency in the country.

"There is now a patriotic opportunity for our citizens unitedly to join in this campaign against depression. Given such patriotic cooperation we can secure a definite upward movement and increase in employment. That service is to secure the return of hoarded money back into the channels of industry. During the past year and with an accelerated rate during the last few months a total of over 1,300 millions of money has been hoarded. That sum is still outstanding. I am convinced that citizens hoarding currency or money do not realize its serious effect on our country. It diminishes the credit facilities by many billions. Every dollar hoarded means a destruction of from $5 to $10 of credit. Credit is the bloodstream of our economic life. Restriction or destruction of credit cripples the revival and expansion of agriculture, industry, commerce, and employment. Every dollar returned from hoarding to circulation means putting men to work. It means help to agriculture and to business. Everyone hoarding currency injures not only his own prospects and those of his family, but is acting contrary to the common good. It is to their own interest that they should return it to circulation, as well as a patriotic service to the country as a whole. A prime need today is the extension and liberalization of credit facilities to farmers and small businessmen. The credit institutions are greatly crippled in furnishing these needed credits, unless the hoarded money is returned. Therefore, I urge all those persons to put their dollars to work--either by conservative investment, or by deposit in sound institutions in order that it may thus return into the channels of economic life.

"During the Great War our people gave their undivided energies to the national purpose. Today we are engaged in a war against depression. If our people will give now the same service and the same confidence to our Government and our institutions, the same unity and solidarity of courageous action which they gave during the Great War, we can overcome this situation. I, therefore, request our citizens to enlist with us in the fight we are making on their behalf. I call upon our civic associations to organize in every State and town to make clear the problem and to effect our purpose. That it can be done successfully and that our citizens will respond to this patriotic service and that hoarded money will be returned when they understand its effect upon their own town life has been demonstrated by such movement in several communities already.

"In order that we may have definite organization for this service, I am today calling upon the heads of the leading civic organizations to meet with me on Saturday next for the creation of a national organization to further this campaign. In the meantime, I request that the heads of such civic organizations in each State and in each community organize without waiting for the national action. I have so far invited the heads of the Chamber of Commerce, the labor and agricultural associations, the church and school organizations, the men and women's service clubs, the veterans and patriotic organizations, and the trade associations."