this Act of all the various sums of money to be paid to the American
Reserve Bank all such sums of money shall be combined and held in one
common fund and be known as the American Reserve Bank Fund, and this
fund shall guarantee the repayment of all Government deposits made with
the American Reserve Bank and the redemption of the national bank notes
of any failed bank.
COMMENT:--In paragraph three, under Section 59, provision was made for
a 5 per cent guarantee fund to redeem the bank notes of any bank which
has failed. This fund is held by the American Reserve Bank, which
under Section 78 will be used to redeem the notes of all failed banks
immediately and the amount of the notes so redeemed shall be recouped
from the assets of the bank that issued the notes; if, by chance, one
should fail after it has become a part of the proposed system, which
I, for one, do not believe is possible.