Federal Reserve Bulletin, 1917-05

FEDERAL RESERVE BULLETIN ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON MAY, 1917 WASHINGTON GOVERNMENT POINTING OFFICE 2917 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BOARD. EX OPFICIO MEMBERS. | W. P. G. HARDING, Governor. w ., n \**K ™ PAUL M. WARBURG, Vice Governor. WILLIAM G. MCADOO, _^ _ ' ^ . -.7 m FREDERIC A. DELANO. Secretary of the Treasury, . _. Chairman. ADOLPH C JOHN SKELTON WILLIAMS, CHARUSS Comptroller of the Currency. _ _ H. PARKER WILLIS, Secretary. SHERMAN ALLEN, Assistant Secretary and Fiscal Agent. M. C. ELLIOTT. Counsel. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUBSCRIPTION PRICE OF BULLETIN. The Federal Reserve Bulletin is distributed without; charge to member banks of the system and to the officers and directors of Federal Reserve Banks. In sending the Bulletin to others the Board feels that a subscription should be required. It has accordingly fixed a subscription price of $2 per annum. Single copies will be sold at 20 cents. Foreign postage should be added when it will be required. Remittances should be made to the Federal Reserve Board. Member banks desiring to have the Bulletin supplied to their officers and directors may have it sent to not less than 10 names at a subscription price of $1 per annum. No complete sets of the Bulletin for 1915 are available. Bound copies of the Bulletin for 1916 may be had at $5 per copy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TABLE OF CONTENTS. Pago. Review of the month 335 War financing 340 • Text of the war-bond act 345 Conference of governors of Federal Reserve Banks 347 Forms of Federal .Reserve drafts 347 Foreign war loans 349 Growth of the acceptance business 350 German war loans 350 Substitution of collateral 351 a National banks and the war 351 Gold-settlement fund 353 Operation, of the clearing system 354 Experience of State banks in the Federal Reserve System 355 Press statements issued by the Comptroller of the Currency ; 372 New national-bank charters 374 Payment for national-bank examinations 374 Commercial failures throughout the United States 374 The progress of inflation (reprinted from the London Economist) 375 Informal rulings of the Federal Reserve Board 378 Law department " 380 Business conditions throughout the Federal Reserve districts 382 Foreign exchange rates in belligerent, neutral, and silver-standard countries 404 Charts showing 406 'Discount operations of the Federal Reserve Banks 407 Acceptances 412 Resources and liabilities of Federal Reserve Banks 416 Federal Reserve note accounts of Federal Reserve Banks and agents 418 Earnings on investments of Federal Reserve Banks 420 Discount rates in effect 421 Gold imports and exports 422 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN VOL. 3 MAY l, 1917. No. 5 REVIEW OF THE MONTH. It remains true, however, that the weak point in the financial prepara- The action of Congress on April 6 in forie tion of the COUP.try is the fact mnllv declaring the existence ^Preparation for ^ ^ ^ that the Federal Reserve Sysof ft ()f Gcrmany tem includes up to date less than 50 banks other found the Federal .Reserve Systhan those in the national system, arid that it tem with little in the way of preparation still therefore, comprises hanking capital and surto be accomplished. As set forth, in previous plus equal in the aggregate only to about onenumbers of the Federal Reserve Bulletin, prehalf of the total of the country at large. In cautions had. already been taken, in view of the this situation it has been well understood that evident disturbance of international conditions, should stringency or banking difficulties set \n to insure the maintenance of the Federal lieat any time it would be necessary for the banks serve Bonks m a highly liquid state. Notwithof the Federal Reserve System indirectly, even standing that they were already strong- in gold though not directly, to ''carry" the State banks and lawful money, they had been early in the by the extension of assistance to member brinks, year urged to curtail the aggregate amounts which in their turn would aid. the less well proof the investments they were carrying, so tected State institutions., This condition has that the total earning assets at the beginning been fully recognized by many intelligent and of the war had been, reduced, to $167,994,000 public-spirited State bankers, who have adfrom S221,898,000 at the beginning of the- year. mitted the obligation resting upon them of Dining the first quarter of 1.917 large orders for lending their support to the establishment of a Federal Reserve notes were placed with the universal plan of cooperation inclusive of prac- Bureau, of Engraving and Printing, and the tically all of the eligible banks of the coimtiy. notes when prepared were shipped to the Suh- On April 10 the executive committee of the treasurios and. Mints throughout the country I trust company section of the American Bankso that they would be readily available in the j ers' Association, at a meeting in Now York, event of need. The declaration, of war, thereadopted the following resolution: fore, found the financial system of the United States, so far as the holding of its reserve funds Resolved, That this committee urgently recommend to are concerned, in strong position. No now the trust- companies of the United States that immediate policies or precautions wore therefore called for. stops be taken to secure amendments, where necessary, to the State laws in order that the trust- companies may be The condition of the member banks as reported. permitted to carry their gold reserves on deposit with the by the Comptroller of the Currency is strong Federal Reserve Banks in their several districts, and that generally throughout the country. For these as soon as such action can be legally taken the trust comreasons, among others, the actual announce- panies offer to deposit, these reserves with, the Federal ment of the entry of the United States into the Reserve Banks. war has produced no real disturbance on the The delay on the part of some in indicating a part of the -financial community, and none, so desire to enter the system has been in a raeasule far as can be perceived, among the. members ofI due to the belief that some changes desired by the Federal Reserve Svstom. i them in the Federal Reserve Act would uu* 335 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

336 FEDERAL RESERVE BULLETIN. MAY 1. 1917. doubtedly be made at an early date, and also in ment is to be undertaken during the present a measure to the feeling that conditions through- special session. The amendments follow the out the country were generally sound, and that same general lines as when last recommended they might, without prejudice to the welfare to Congress, but there has been added to them of the community, postpone the date when a provision designed to incorporate into law they would apply for admission. But such the essential features of the Board's already conditions are, or at least may be, fundamen- existing regulations with reference to the tally altered by war, and there has been within, membership of State banks in the Federal Rethe past month a very decided impetus among serve System. This, if adopted, will give to the stronger State banks toward obtaining prospective members substantially the same membership in the Federal Reserve System. privileges already enjoyed by member State Among those which have applied for and banks, but will furnish the greater assurance actually been granted membership during the of freedom from change that is afforded by the month are: The Peoples Bank, of St. Paul- fact that the conditions of membership have Minn.; The Cleveland Trust Co., of Cleve- been formally embodied in a Federal statute. land Ohio; The St. Louis Union Bank of St. Included among the amendments, as before, Louis, Mo.; The Farmers State Bank, of Kas- is a provision authorizing State banks and son, Minn. trust companies to maintain funds on deposit A number of other leading State institutions with Federal Reserve Banks, without becomhave informed the Board of their intention to ing full members, and to derive certain corapply for membership within a short time, responding benefits from the operation of the waiting only for the completion of certain neces- system. The Board has so often expressed its sary formalities. It would seem, therefore, that opinion with reference to the whole body of the early extension of the Federal Reserve amendments thus offered, and has so fre- System, to include a considerable proportion of quently set forth their essential features, that it is not necessary at this time to review the the largest and best-conducted State institubasic ideas presented by them, except to note tions in the country, is a foregone conclusion. that the emergency conditions of financial This result, when attained, will insure the comstrain, against which the amendments were bination of the country's resources of reserve intended to guard, are now directly facing the money under joint management and consecountry. It is not too late to adopt the remequently their use in the most economical and dies which have already been indicated as a effective way in sustaining the industrial and mode of protection against dangers arising commercial interests as well as the public from such sources. finances of the Nation during the conflict upon which it has entered. In continuation of the policy already insti- With a view to securing the enactment of Investments of tuted> investment operations legislation that would render the banks during of the Federal Reserve Banks P°ssibIe the consolidation of Apri!* during the last week of March the banking resources of the and the first three weeks in April, as gauged by country in the most effective form, the Board comparative figures of earning assets for March; has again transmitted to Congress the amend- 30 and April 20, indicate but moderate activity ments to the Federal Reserve Act which it of the banks in the discount and acceptance recommended at the regular session of last fields and practical suspension of investments winter. These amendments have already been in municipal warrants. taken up by the Banking and Currency Com- Increases are shown in the holdings of Govmittees of the two Houses, and are included ernment securities following the taking over by in the list of necessary legislation whose enact- the Federal Reserve Banks of $50,000,000 of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 337 90-day 2 per cent United States certificates of and financial machinery of the country in indebtedness about the end of March and the order to make the loan an immediate success allotment to the banks, about the same date, and to draw off the proceeds without embarof $10,877,500 of 2 per cent bonds offered for rassing commercial and industrial interests will sale by member banks through the Treasury be required. Department. The result of these operations The Secretary of the Treasury, in a public was to restore the Federal Reserve Banks to the statement April 21, described the policy to be general investment level they had reached pursued as to these funds, as follows: before the policy of reduction of outstanding j "The Secretary appreciates the desirability lines already sketched was adopted. j of avoiding any derangement of the money market, and in the financial operations in Federal Reserve Bank. Mar. 30. '• Apr. 20. inc N re e a t se. dec N re e a t se. which the Government is about to engage it will be his purpose to adjust receipts and dis- Boston $17,314,0001816,674,000 I .1640,000 bursements in such a way that as far as possible New York 19,781,0001 16,780,000 3,001,000 Philadelphia 12,204,000 11,293,000 911,000 money paid in will be promptly returned to the C R l i e c v h e m la o n n d d 1 6 0 , , 7 1 ( 3 5 0 3 , , 0 0 0 0 0 0 1 7 2 , , 3 4 7 1 8 1 , , 0 0 0 0 0 0 2 $ ,2 6 8 1 1 5 , , 0 0 0 0 0 0 ! market. The contemplated sale of Treasury C A h tl i a ca n g ta o 5 9 , , 7 4 0 6 7 9 , , 0 0 0 0 0 0 4 6 , , 6 4 9 9 0 6 , , 0 0 0 0 0 0 |2 1 , , 9 0 7 1 3 7 , , 0 0 0 0 0 0 certificates is in line with this policy. Should M St i . n L n o e u ap is olis 5 5 , , 4 1 7 2 3 8 , , 0 0 0 0 0 0 1 4 0 , , 3 1 2 0 8 0 , , 0 0 0 0 0 0 4*972,"666"j. 1,145,000 the banks during the next few weeks absorb D K a a l n la sa s s City 3 2 , , 0 8 8 6 4 3 , , 0 0 0 0 0 0 3 1 , , 2 9 5 11 6 , , 0 0 0 0 0 0 172,000 !. "952," 666 several hundred million dollars of these certifi- San Francisco 6,663,000 7,345,000 682,000 j. cates, the proceeds being paid out in the course Total bills 104,579,000 102,662,000 1,917,000 of business, the brinks will possess ready means Total municipal warrants 15,715,000 15,163,000 | 552,000 with which to meet withdrawals made later by Total United States bonds, Treasury notes, depositors in paying for bond subscriptions. and certificates of indebtedness.. 47,700,000 109,575,000 61,875,000 \. The result of this method will be a gradual Total investments anticipation of payment on account of bonds held 167,994,000 ;227,400,000 59,406,000 with a steady and continuous return to the banks of the moneys paid in." The adoption by Congress of a bill authorizing the raising of $7,000,000,- The Federal Reserve Banks as holders of the Treasury fi- 000 for the conduct of the warliquid cash resources of the Nation can, of nances. with Germany is an unprece- course, be expected to be actual subscribers to dented financial event, provid- the bonds only in a very small measure, and ing, as it does, for one of the largest, and in some it is the view of the Federal Reserve Board aspects the largest, of public-lending operations that the member banks should themselves act during modern times. In its immediate effect chiefly as distributors. the act is also of very great interest to the banks A Treasury loan of $50,000,000 in short-term of the country, and especially to the Federal Re- certificates (payable June 30) Short-term certifiserve Banks. The conditions upon which the bearing interest at the rate of cates. new bonds will be offered to the public have i 2 per cent per annum, was not been decided, the measure adopted by joffered by the Secretary of the Treasury to Congress leaving to the discretion of the Sec-Federal Reserve Banks on March 31, and retary of the Treasury the determination of was entirely taken up by the reserve banks all of the details of this matter. Whether upon the same day upon which it was offered. the new bonds be issued in larger or smaller These subscriptions were in general distributed installments, however, it is generally agreed j roughly, according to the capitalization of rethat the use of all of the available banking serve banks, and were made with a view of holding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

838 FEDERAL EESEKVE BULLETIN. MAY I, 1JM7. the funds until the maturity of this short-period ba: kh g fur:ds. The harks of the country by loan. The proceeds were in part used to meet absorbing these certificates in advance of the issue of the war loans will possess themselves the obligation of the United States for the of ready means with which to meet withdrawals purchase of the Danish West Indies and in i made by depositors for the purpose of paying part to meet the current needs of the Treasury, ! for bond subscriptions and they will thereby the loans being thus practically in anticipation i assist in. an effective manner in paving the way of the income tax, due at the close of the cur- for the successful flotation of our war ioai s.;; rent fiscal year. Subsequent to the passage Clearing-house reports received from New by both Houses of the general bond bill pro- York City indicate reductions viding for the financial conduct of the war, Changes in re- j the result of loan n reserTes as although prior to the final ratification of the serves. . work of the conference committee, another expansion and loss oi casn ocsum of $200,000,000 was offered to the banks twoen the weeks ending March. 17 and 31, when of the country at 3 per cent. At the request of reserve percentages for the 60 banks, which the Secretary of the Treasury, this loan was compose the membership of the New York offered through the Federal Reserve Banks, Clearing House Association, declined from acting as distributors, and was by them placed 23.7 to 21.5. A slight improvement in the with the member banks all over the country, reserve situation of these banks is shown for the response being prompt and satisfactory, the week ending April 7, since when, the reserve especially in Now York. Many subscriptions percentages have again moved, downward, in excess of the amount asked were received. reaching 21.9 per cent on April 21, or four It was announced that the certificates issued points above the low level touched on the last representing this loan would be acceptable in of March. Smaller declines are shown by the part payment of subscriptions to the war State Banking Department for the trust combonds, whose sale is expected to be announced panies and. State banks in Greater New York. within a comparatively short time. It is interesting to note in this connection that The Board's policy in regard, to this operation the two weeks ending March 30 and April 6 was set forth by Governor Harding in a letter witnessed heavy importations of gold into this to Federal Reserve Banks, dated April 20, in country, most of which was directed to New which he said in part: York City. ''ID view of the large issues of United States Average excess reserves of the Boston Clearbonds which will be offered in the near future ing House banks declined, from 840,293,000 for and which it is hoped will be subscribed for to the week ending March 17, to $37,940,000 for a great extent by investors, large and small, the week ending March 24, but showed increases whose funds arc now on deposit in banks, the for the following weeks. Figures for the week Board regards an investment by banks in United States Treasury certificates of indebt- ending April 21 are 847,646,000, a gain for the edness having a short maturity and which are week of over 7.3 millions. receivable in payment of subscriptions to Similar figures for the 34 national banks and United States bonds, as a highly desirable trust companies composing the Philadelphia investment for them. The Secretary of the Clearing House Association show but little Treasury has announced his intention, in the in arcial operations in. which the Government change during March, but considerable gains is about to ergage, to adjust receipts arid dis- for the first two weeks in April, the reported bursements in such a way that as far as pos- excess reserves of the clearing-house banks for sible money paid in. will be promptly returned the week ending April 14 being $37,061,000. to the market and the Federal Reserve Banks The report for the week ending April 21 indimay be counted upon by offerirg liberal terms of rediscount-ing to do their utmost in counter- cates some reduction in the reserves of the acting any effect of temporary dislocation of Philadelphia national banks, the combined excess reserves of all the clearing-house insti- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 191.7. FEDERAL RESERVE'BULLETIN. 339 tutions standing now at $31,186,000, compared past year, and the reduction of surplus stocks with $30,186,000, the average for the week to a point which leaves the country practiending March 24. cally dependent upon the current output for For the four weeks ending April 13, the total support. That this shortage will bo in some Gold imports and net inward £old movement was measure overcome or offset by organized acexports. $61,330,000, gold imports, tivities which have been undertaken with a chiefly from Canada, amount- view to maintaining supplies of grain and ing to $82,071,000 and gold exports to $20,-other agricultural products is to be hoped, 741,000. The increase in the country's stock but the facts already developed make it clear of gold through net gold imports since August 1 that no such result can be achieved without f 1914, is shown0in the following exhibit: earnest and persistent effort, while general curtailment of unnecessary consumption must Gold imports and exports of the United States from Aug. 1,occur if the supplies of food are to be made 1914, to Apr. 13, 1917. sufficient for both local and foreign necessifOOO's omitted.] ties. In short, the country is in tho unusual I position of being unprecedentedly strong in a i Excess im- I Imports. Exports.| ports over banking and financial way, and abnormally 1 I exports. active industrially, at the same time that it ! Aug. 1 to Dec. 31, 1914 823,253 8104,972 o -$81,719 faces most unusual problems in * supplying Jan. 1 to Dec. 31,1915. 451,955 31,420 420,529 Jan. 1 to Dec. 31, 1916 i 085,745 793! 529,952 itself with food and other necessary articles. Jan. 1 to Apr. 13, 1917 330,112 598! 258,514 i This is in many respects a reversal of condi- Total ! 1,491,0G5 303,789 I 1,127,276 tions that have existed in former periods of a Excess of exports over imports. stress. The upward course of prices, already The reports on general business conditions, very marked, has now become a primary symptom of the general conditions that are to be furnished to the Board by Fed- General busi- ]_ Reserve Agents in the sev- faced during the coming months. In another era iiess conditions. to column we reproduce an article from the Lonera! districts, are corroborated don Economist, which traces the experience of by other evidence from various quarters and Great Britain since the outbreak of the present show that, despite the fact that the country war in this connection, and may serve to indihas entered upon a war status, there has been cate some of the dangers which the United little or no disturbance of underlying condi- States is called upon to avoid at the present tions. The probability .that war would be time. begun had, in fact, been largely discounted in An important extension of the Federal Readvance, and not only the financial but the inserve System has been deterdustrial preparation of the country was such as " m^d upon by the Federal to render the effect of the declaration far less Reserve Bank of San Franimportant than would have been true under 1 cisco, which with the approval of the Board, ordinary conditions. With the heavy foreign • has voted to establish three branches in the demand for American goods, sustained as it is ; Pacific Northwest, one at Seattle, one at now to be by the credit of the United States, | Portland, and one at Spokane, Wash. The the condition of high prices and urgent call i branch at the last-named place will probably for practically every article that the country be the first to be opened, the others to follow is capable of manufacturing is assured. The as rapidly as possible and to be established outstanding feature of the situation is seen in ; upon the same conditions as that at Spokane. the unusual and extreme shortage of food : The Board has been advised that the State products, due to the large exportation of the 93720—17 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

340 FEDERAL RESERVE BULLETIN. MAY 1,19.17. banks in Spokane will immediately apply for The Federal Advisory Council met in Washmembership in the Federal Reserve System as a ington on April 16 and 17, havcondition precedent to the establishment of a inS advanced its meeting about branch at that point. For some time past it has a month in order to consider been evident that, owing to the great distances pending financial and banking problems. The included in the Twelfth Federal Reserve District, session was devoted largely to consideration of the creation of branches or agencies at various questions relating to Government loans, the points would probably be necessary in order to Board's proposed amendments to the Federal afford to the member banks throughout the Reserve Act, and kindred matters. Indorsedistrict immediate access to the facilities of the ment was given to the amendments to the act Federal Reserve System. This need was em- proposed by the Board with one or two minor phasized during the slight banking disturbance modifications, thus in part altering the position which occurred in Seattle some weeks ago when assumed .by the Council in December, 1916. there was an immediate call for Federal Reserve The Council assured the Board that every notes for the use of the member banks at that effort would be made to render aid in carrying point. The new branches will not only afford into effect the plans for meeting the necessities immediate access to the discount facilities of of the Government in the financing now in the system, but will also greatly tend to facili- prospect, and the general interchange of views tate the 'prompt collection of checks. This indicated that banking conditions the country whole question of branches in the Pacific over were excellent. It was stated that ven^ Northwest was carefully considered by the small withdrawals in some parts of the country Federal Reserve Bank of San Francisco late in had occurred, due to uncertainty or doubt on the March, when Mr. A. C. Miller, member of the part of foreign depositors with reference to the Federal Reserve Board, visited the bank, and safety and freedom from disturbance of their dehearings were held at which Portland, Seattle, posited funds. These fears have been in large and Spokane bankers appeared and presented measure allayed, and there have been no maniargument covering all phases of the situation. festations of general suspicion or anxiety with The details of the plan for the organization reference to the condition of affairs. The and management of the branches will be meeting was attended by all members of the worked out as soon ais possible and will then Advisory Council except the chairman, Mr. Forbe made known. Meantime the Board has gan, who was detained in the South in consebeen giving careful consideratiin to the ques- quence of illness. tion of branches in other districts where member banks have indicated a strong desire for the War Financing. extension of facilities in this way. In every War financing of record magnitude has been such case the problem to be met is whether a authorized for the United States during the full fledged branch organized under the prolatter part of April. Without a dissenting visions of the Act, involving the expense which vote in either House of Congress authority has necessarily goes with such an organization, is been given for the issue by the Secretary of the called for or whether a more simply organized Treasury of $7,000,000,000 in war bonds and agency will meet the requirements of the shorter term certificates of indebtedness. The situation. The answer to this question defigures of this initial authorization dwarf the pends in each instance upon the character and early war financing of European countries. volume of business developing at the point to Anticipating an agreement by the two be served and the support to be expected from Houses of Congress over the details of the bill the bankers of the community to be served by authorizing bonds and certificates of indebtthe branch. edness to be issued, the Secretary of the Treas- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MA* 1, 1017. FEDERAL RESERVE BULLETIN. 341 ury on April 20 announced that as soon as the bonds subsequently acquired by the Federal bill became law he would sell $200,000,000 of Reserve Banks into bonds paying a higher rate of interest. The Board no doubt will certificates of indebtedness to meet the reultimately ask for such an amendment. quirements of the Treasury and the war situa- From the best information obtainable it is tion, pending the sale of Government bonds- unlikely that Congress will at this session pass In this connection it was stated that the offer- any legislation except that coming within the ing of bonds would probably require about 60 classification of war measures. It is fully understood that unless such an amendment is days. After testing the sentiment as to the obtained Federal Reserve Banks will not be interest rate at which the certificates should be disposed to purchase 2 per cent bonds and to issued, 3 per cent was determined upon offer them for conversion into 3 per cent bonds and the amount increased to $250,000,000. and notes, and the Board would not require These certificates are payable on June 30. such purchase if the 3 per cent bonds are below par and a conversion could not be made with- Subscriptions for this $250,000,000 were obout a loss to the Federal Reserve Banks. tained in a remarkably short time through the Before determining whether an effort should agency of the 12 Federal Reserve Banks. be made at this time to obtain the desired amendment, or whether this action should be POSITION OF OUTSTANDING BONDS. deferred until Congress reconvenes in December, the Board will be glad to have the views Federal Reserve Banks are holders of a conof the governors on the following questions: siderable amount of 2 per cent United States (1) Will the probable demands for currency consols and 3 per cent 30-year bonds and 1- during the period of the war make it advisable year certificates of indebtedness. Considcra" to discourage curtailment of national-banktion was given by the Federal Reserve Board note circulation by discontinuing all conversion of 2 per cent bonds having the circulating privito the position of these bonds in view of the lege for bonds or notes without the circulating proposed new issue at an interest rate of 3J privilege ? In other words, is it probable that per cent. Upon the question whether au- Federal Reserve notes can be issued in sufficient thority for the conversion of the above-named volume to take care of current needs, or will it securities into 3| per cent bonds should be probably be necessary for Federal Reserve requested of Congress in an amendment to the Banks to use any 2 per cent bonds acquired as a basis of issue for Federal Reserve Bank war-bond legislation, the Federal Reserve notes in order to supplement circulation Board sent out the following letter: outstanding ? (2) x^ssuming that there will be no redun- Telegrams have been received from a majordancy of circulation if retirement of nationality of the governors of the Federal Reserve bank notes is not encouraged, would it not be Banks calling attention to the fact that the advisable to defer any effort to obtain an bill which recently passed the House authorizamendment to section 18, which might have ing the United States to issue and sell 3.| per a tendency to encourage the conversion of cent bonds, contains no prevision for the conbonds having the circulating privilege for bonds version of the 3 per cent bonds held.by the without this privilege ? several Federal Reserve Banks. The Board has already given consideration ; The Secretary of the Treasury has made no to this matter, realizing that the issuance of \ announcement of his position in this matter. $5,000,000,000 worth of 3J per cent bonds would naturally have a tendency to depreciate j FIRST OFFERING OF CERTIFICATES. the market value of the 3 per cent bonds held ! Below is given the announcement of the by the Federal Reserve Banks. The amount i Secretary of the Treasury, given to the press now held by such banks, namely, about 1 on April 20, stating his purpose to make the $7,000,000, is, however, relatively small and the : first offering of certificates of indebtedness Board is undecided whether it would be justified at this time in asking for an amendment 1 under the war loan act of $200,000,000: to section 18 authorizing the conversion of the| Secretary McAdoo stated to-day that as soon 3 per cent bonds now held and the 2 per cent i as the war loan bill becomes a law he intends Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

34 FEDERAL RESERVE BULLETIN. MAY 1, 1917. to sell such amounts of Treasury certificates of DUTY OF RESERVE BANKS. indebtedness as may be necessary to meet the On the day the above statement was issued requirements of the Treasury and the war situa- Governor Harding sent to Federal Reserve tion pending the sale of Government bonds. Banks the following letter: It will probably require about 60 days to make a public offering of bonds. Meanwhile Your attention is directed to a statement certificates of indebtedness maturing June 30, issued to the press this afternoon by the Secand receivable with accrued interest, in pay- retary of the Treasury. In view of the large ment of subscriptions for bonds, will be sold. issues of United State; bonds which will be The Secretary appreciates the desirability of offered in the near future and which it is hoped avoiding any derangement of the money mar- will be subscribed for to a great extent by inket, and in the financial operations in which the vestors, large and small, v/hose funds are now Government is about to engage it will be his on deposit in banks, the Board regards an purpose to adjust receipts and disbursements investment by banks in United States Treasury in such a way that as far as possible money paid certificates of indebtedness having a short in will be promptly returned to the market. maturity and which are receivable in payment The contemplated sale of Treasury certificates of subscriptions to United States bonds, as a is in line with this policy. Should the banks highly desirable investment for them. The during the next few weeks absorb several hun- Secretary of the Treasury has announced his dred million dollars of these certificates, the intention, in the financial operations in which proceeds being paid out in the course of busi- the Government is about to engage, to adjust ness, the banks will possess ready means with receipts and disbursements in such a way that which to meet withdrawals made later by de- as far as possible money paid in will be positors in paying for bond subscriptions. The promptly returned to the market and the result of this method will be a gradual antici- Federal Reserve Banks may be counted upon pation of payment on account of bonds with a by offering liberal terms of rediscounting to do steady and continuous return to the banks of their utmost in counteracting any effect of the moneys paid in. temporary dislocation of banking funds. The The Secretary sounded the market yesterday banks of the country by absorbing these certifiwith respect to temporary borrowings and met cates in advance of the issue of the war loans, with a very satisfactory response on the part of will possess themselves of ready means with important banks and bankers in financial cen- which to meet withdrawals made by depositors ters, especially in New York City. TheSecretary for the purpose of paying for bond subscripwas assured that reasonable immediate re- tions and they will thereby assist in an effective quirements could be met by a sale of certifi- manner in paving the way for the successful cates bearing as low a rate as 2\ per cent in- flotation of our war loans. terest, but that there would be no doubt about The Board does not doubt that you will the sale of the largest amount of such debt cer- impress upon the banks of your district, both tificates and that a wide market for the same national and State, the importance of this could be created if they were offered at 3 per offer, and that you will enlist their hearty cent interest. cooperation in this plan of preparing the field The Secretary feels that in order to carry out and preparing themselves. the policy above outlined, temporary borrow- This press statement wasjggued on April 21: ing ought to be done on a basis that will enable banks generally throughout the country— The Federal Reserve Board to-day telegraphed State banks and trust companies as well as all Federal Reserve Banks that payments for member banks of the Federal Reserve Sys- the new issue of certificates of indebtedness tem—to have a thoroughly liquid asset in their under the war financing act, subscriptions for vaults and at the same time to be able to avail which have been taken by Federal Reserve themselves of the opportunity of preparing for Banks, will probably be called for by the Secrethe large bond issue. Therefore, as soon as the tary of the Treasury April 25 or 26. Remitwar loan bill becomes a law, the Secretary pur- tances will be made by subscribers to theFederal poses to authorize Federal Reserve Banks to Reserve Banks of their districts and placed to receive applications for Treasury certificates of the credit of the Treasurer of the United States. indebtedness, payable June 30 next, and bearing interest at the rate of 3 per cent per annum. EXISTING INDEBTEDNESS. _ _I The first offering of such certiiLutes will proba- The Treasury Statement of March 31, 1917, bly be $200,000,000. showed the interest-bearing debt of the United Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 19.17. FEDERAL RESERVE BULLETIN. 348 States to be §1,023,357,250. This included edness. This does not include the authorizathe $50,000,000 in certificates of indebted- tion to issue bonds or notes to maintain the ness issued as of April 1, but does not include gold reserve or for the i-sue of postal savings the $200,000,000, announcement of the inten- bonds. tion to issue which was made on April 20. Below is given a table showing the authoriza- There is authority under legislation exist- tion, rate, and amounts of the bonds and cering prior to the passage of the war financing tificates of indebtedness which make up the law for the issue of $495,569,000 in bonds present interest-bearing debt of the United and $320,000,000 in certificates of indebt- States: Interest-bearing debt, payable on or after specified future dates. [Treasury statement of Mar. 31,1917.] Title of loan. Authorizing act- Rate. I ! i W ss h u e e n d. When redeemable or payable. A is m su o e u d n . t : j . M O a u r. t s 3 t 1 a , n 1 d 9 i 1 n 7 g . Consols of 1930 i Mar. 14,1900 2 per cent. 1900 . Payable after Apr. 1,1930 |i $(>4G, 250,150 ! §000,288,850 Loan of 1908-1918 June 13,1898 3 per cent. 1898 . ; / \ R Pa e y d a e b em le a A bl u e g a . f 1 te ,1 r 9 A 18 ug. 1,1908... '198,792,660 03,945,400 Loan of 1925 ' Jan. 14,1875 4 per cent. 1895-96 ; Payable after Feb. 1,1925... '162,315,400 113,489,900 Pa S n e a r m ies a 1 C 9 a 0 n 6 a l loan: June 28.1902; Dec. 21, 2 per cent. 1906 i :\ / P R a e y d a e b em le a A bl u e g a . f 1 te ,1 r 9 A 36 u g. 1,1910...\ \ \ ) 4 - ° , 4 ' (bm6i >9Qv ™ iv) ! ! 49,817,480 Series 1908 : 190 d 5 o . ' ...do 1908 ^ / P R a e y d a e b em le a N bl o e v a . f 1 te ,1 r 9 N 38 o v. 1,1918... i i \ f * on ftMfV * I uw A ' A "^ ,, ; 20,178,000 Scries 1911 i Aug. 5, 1909; Feb. 4, '3 per cent. 1911 i Payable June 1,1961 j 50,000,000 50,000,000 i. 1910; Mar. 2,1911. Conversion bonds '\ Dec. 23,1913 ...do 1916-17 Payable 30 years from date of 25,057,200 ; 25,057,200 issue. One-year Treasury notes do ...do 1916-17 I Payable 1 year from date of issue. 23,540,000 "•.23,540,000 Certificates of indebtedness : Mar. 3,1917 2 per cent. 1917 . !: ( R Pa e y d a e b em le a J b u le n e a 2 ft 9 e , r 19 1 1 7 y ear from , .50,000,000: 50,000,000 Postal savings bonds (1st to 11th : June 25,1910 2\ per cent 1911-16 |' i . I I P a d y a a t b e l e o f 2 0 is s y u e e ars from date of 9,151,800 ; 9,151,800 series). i I issue. Po s s e t r a i l e s s ) a . v ings bonds 1917-1937 (12th i : do : ; 2\ per cent! I 1 Q 91 I ' 7 ; i \ / P R a e y d a e b e l m e a J b a l n e . a 1 ft ,1 er 9 3 J 7 a . n . 1,1918.... j \ / 88ft7fi ' 7 ite of interest-bearing ; i i 11,250,027,150 1,023,357,250 1 Of this amount §21,266,300 have been, con verted into conversion bonds and 818,695,000 into one-year Treasury notes. 2 Of this original amount issued $132,449,900 have been refunded into the 2 per cent consols of 1930, and $2,390,800 have been purchased for the sinking fund and canceled, and S500 have otherwise been purchased and canceled. s Of this original amount issued 343,825,500 have been purchased for the sinking fund and canceled. * Of this original amount issued 81,886,500 have been converted into conversion bonds and $2,928,000 into one-year Treasury notes. o Of this original amount issue* §1,904,400 have been converted into conversion bonds and £1,917,000 into one-year Treasury notes. There is presented below a list of the exist- SUBSCRIPTIONS IN 1898. ing legislation, exclusive of the War Loan Act, For subscriptions to the $200,000,000 war under which the Government of the United bond issue of 1898, 31 days were allowed. In States may issue bonds and certificates. this period the Treasury Department received ! Rat< au A th m o o ri u z n e t d. Issued. subscriptions numbering 320,226 for $1,500,- 000,000. It is interesting, in view of the P. ct. S5o,ooo,ooo authorized issue of war bonds, of which it is 1. Panama ("anal bonds, act Aug. 5,1909. | 3 S295,569,000 2. Panama Canal bonds, issue for nitrate ! None. I anticipated that individuals will take a good plant, act oi" June 3, 1916 3 120,000,000 3. Panama Canal bonds, issue for nier- >. None. I part, to note the number of subscribers for chant marine, act of Aug. 5, 1909... 3 | 150,000,000 4. For extraordinary expenditures, rev- i small amounts to the loan of 1898, as shown enue act Mar. 3, 1917 (Mexican ex- ' | penditures, armor-plate plant, . by the table given below: Alaskan raihyay, purchase of Dan- • ! ish West Indies, etc.) i 3 j 100,000,000 None. 5. Expediting naval construction, act * Subscriptions: of Mar. 3. 1917 3 i 130,000.000 None. (i. Certificates of indebtedness, act of • I For less than $100. 11,483 Mar. 3,1917 '•• o ! 300,000,000 50.000,000 $100 to $180.. 14,974 7. Certificates of indebtedness, act June . 2.-, 1910. I o j 20,000,000 $200 to $280 ! 9,902 $300 to $380 : 7, 594 1 Included in 1. Legislation authorizing the issue of bonds or notes to maintain the §400 to $480 7, 698 gold reserve and parity, and lor issue <if post.;;; savings bonds, is not included in the abovn list. S500 only ' 180, 573 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

344 FEDERAL BESEKVE BULLETIN. MAY 1, 1917. Subscriptions—Continued, notes of 1864 and 1865, which were payable in $520 to $980 11,862 lawful money, contained any statement as to $1,000 to $1,980 25,152 the kind of money in which they should be $2,000 to $2,980 10, 349 paid. The bonds of 1898 are redeemable after $3,000 to $3,980 5,165 $4,000 to $4,400 5, 223 August 1, 1908, and payable August 1, 1918. $4,500 only 1,875 The first bonds payable specifically in More than $4,500 28,376 United States gold coin were the 2 per cent Total 320,226 consols of 1930, the act providing for which : was approved by the President on March 14, Individual purchases of the loan of 1898 1900. The amount of the issue was $646,250,were not confined to ai>y section of the coun- 150. Of this issue there have been converted try. The subscriptions for $500 or less numby Federal Reserve Banks $24,648,100 into 3 bered 232,224. These were accompanied by per cent 30-year conversion bonds, and $21,full payment, the total of subscriptions of $500 878,000 into 3 per cent one-year Treasury or less being $100,444,560. notes. A considerable part of these con- Every opportunity was given for subscripverted bonds and notes has been sold. The tion to this issue by individuals. Newsbonds thus converted were purchased by papers were supplied with information rela- Federal Reserve Banks either in the open martive to the bonds, and with few exceptions ket or through offerings made by member their aid was given without charge. In addibanks of the system through the Treasurer tion, circulars and forms for subscription of the United States under section 18 of the were supplied to the 22,000 money order post act. The total of 2 per cent consols thus reoffices, to express offices, and to banks. | tired is $46,526,100. Small subscribers were given the preference, and those who had asked for as much as $4,500 ! BOND HOLDING OF FEDERAL RESERVE BANKS. received only a prorated award, on a basis of i $1,300 each. The bonds were dated August 1, ! The United States bond holding of Federal 1898 ; and delivery to smaller subscribers was | Reserve Banks on March 31, 1917, was as completed about September 1. Delivery to the ! follows: larger subscribers continued for some time after that date, receipts of the proceeds for this loan j Amount of United States bonds, certificates I of indebtedness and notes without circulaextending to April 1, 1899, although the bulk of ! tion privilege: subscriptions was fully paid within the first four | 3 per cent of 1961 $900 months. Of the total amount, nearly $125,- 3 per cent conversion 3, 634, 300 000,000 was remitted by means of checks on 3 per cent 1-year notes 20,567,000 banks in all parts of the country. Of the re- 2 per cent certificates of indebtedness... l 48,000,000 mainder, paid in cash into the offices of the Total 72,202, 200 Treasury more than one-third was in tenders Amounts of United States bonds with circula- . of gold, although no preference for one kind tion privilege: of money over another was made. 2 per cent 20.049,910 The bonds bore interest at 3 per cent and 3 per cent 7,491,740 4 per cent 5,168,450 to the time of their issue the Government had never put out bonds payable by their terms, Total 32,710,100 either principal or interest, in gold coin or in Grand total 104,912, 300 silver coin. None of the civil war bonds except certificates of temporary loan and the 182,000,000 of United States certificates of indebtedness entered on books Apr. 2, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL EESERVE BULLETIN. 345 governments, the Secretary of the Treasury, WAR BOND ACT. with the approval of the President, is hereby For purposes of reference there is herewith authorized, on behalf of the United States, to reprinted the text of the act signed by the purchase, at par, from, such foreign governments then engaged in war with the enemies President on April 24, intended to provide of the United States, their obligations hereafter for an issue of bonds for the various expenses issued, bearing the same rate of interest and connected with the present state of war. containing in their essentials the same terms and conditions as those of the United States An Act To authorize an issue of bonds to meet expenditures issued under authority of this act: to enter for the national security and defense, and for the purinto such arrangements as may be necessary or pose of assisting in the prosecution of the war, to extend credit to foreign governments, and for other purposes. desirable for establishing such credits and for purchasing such obligations of foreign govern- Be it enacted by the Senate and House of Rep- ments and for the subsequent payment thereof resentatives of the United States of America in before maturity, but such arrangements shall Congress assembled, That the Secretary of theprovide that if any of the bonds of the United Treasury, with the approval of the President, States issued and used for the purchase of such is hereby authorized to borrow, from time to foreign obligations shall thereafter be contime, on the credit of the United States for the verted into other bonds of the United States purposes of this Act, and to meet expenditures bearing a higher rate of interest than three and authorized for the national security and de- one-half per centum per annum under the profense and other public purposes authorized by visions of section five of this act, then and in law not exceeding in the aggregate $5,000,- that event the obligations of such foreign gov- 000,000, exclusive of the sums authorized by ernments held by the United States shall be, section four of this Act, and to issue therefor by such foreign governments, converted in bonds of the United States. like manner and extent into obligations bear- The bonds herein authorized shall be in ing the same rate of interest as the bonds of such form and subject to such terms and con- the United States issued under the provisions ditions of issue, conversion, redemption, ma- of section five of this act. For the purposes turities, payment, and rate and time of pay- of this section there is appropriated, out of ment of interest, not exceeding three and one- any money in the Treasury not otherwise aphalf per centum per annum, as the Secretary propriated, the sum of $3,000,000,000, or so of the Treasury may prescribe. The principal much thereof as may be necessary: Provided, and interest thereof shall be payable in United That the authority granted by this section to States gold coin of the present standard of value the Secretary of the Treasury to purchase and shall be exempt, both as to principal and bonds from foreign governments, as aforesaid, interest, from all taxation, except estate or shall cease upon the termination of the war inheritance taxes, imposed by authority of the between the United States and the Imperial United States, or its possessions, or by any German Government. State or local taxing authority; but such bonds SEC. 3. That the Secretary of the Treasury, shall not bear the circulation privilege. under such terms and conditions as he may pre- The bonds herein authorized shall first be scribe, is hereby authorized to receive on or beoffered at not less than par as a popular loan, fore maturity payment for any obligations of under such regulations prescribed by the Secre- such foreign governments purchased on behalf tary of the Treasury as will give all citizens of of the United States, and to sell at not less the United States an equal opportunity to than the purchase price any of such obligations participate therein; and any portion of the and to apply the proceeds thereof, and any bonds so offered and not subscribed for may payments made by foreign governments on acbe otherwise disposed of at not less than par count of their said obligations to the redempby the Secretary of the Treasury; but no com- tion or purchase at not more than par and acmissions shall be allowed or pjaia on any bonds crued interest of any bonds of the United States issued under authority of this act. issued under authority of this act; and if such SEC. 2. That for the purpose of more effect- bonds are not available for this purpose the ually providing for the national security and Secretary of the Treasury shall redeem or purdefense and prosecuting the war by establish- chase any other outstanding interest-bearing ing credits in the United States for foreign obligations of the United States which may at Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

346 FEDERAL UJiSEBVE BULLETIN. MAY 1, 1917. such time be subject to call or which may be Secretary of the Treasmy may prescribe, be purchased at not more than par and accrued convertible into bonds bearing a higher rate interest. of interest than the rate at which the same SEC. 4. That the Secretary of the Treasury, were issued if any subsequent series of bonds in his discretion, is hereby authorized to issue shall be issued at a higher rate of interest the bonds not already issued heretofore au- ! before the termination of the war between the thorized by section thirty-nine of the act ap- I United States and the Imperial German Govproved August fifth, nineteen hundred and ernment, the date of such termination to be nine, entitled "An act to provide revenue, fixed by a proclamation of the President of the equalize duties, and encourage the industries United States. of the United States, and for other purposes77; SEC. 6. That in addition to the bonds ausection one hundred and twenty-four of the thorized b\^ sections one and four of this act, act approved June third, nineteen hundred and the Secretary of the Treasury is authorized to sixteen, entitled "An act for making further borrow from time to time, on the credit of and more effectual provision for the national the United States, for the purposes of this act defense, and for other purposes'7; section thir- and to meet public expenditures authorized by teen of the act of September seventh, nineteen law, such sum or sums as, in his judgment, hundred and sixteen, entitled "An act to es- may be necessary, and to issue therefor certablish a United States shipping board for the tificates of indebtedness at not less than par purpose of encouraging, developing, and cre- in such form and subject to such terms and ating a naval auxiliary and a naval reserve and conditions and at such rate of interest, not a merchant marine to meet the requirements exceeding three and one-half per centum per of the commerce of the United States with its annum, as he may prescribe; and each certifi- Territories and possessions and with foreign cate so issued shall be payable, with the countries, to regulate carriers by water engaged interest accrued thereon, at such time, not in the foreign and interstate commerce of the exceeding one year from the date of its issue, United States, and for other purposes77; section as the Secretary of the Treasury may prescribe. four hundred of the act approved March third, Certificates of indebtedness herein authorized nineteen hundred and seventeen, entitled "An shall not bear the circulation privilege, and the act to provide increased revenue to defray the sum of such certificates outstanding shall at expenses of the increased appropriations for no time exceed in the aggregate $2,000,000,000, the Army and Navy and the extensions of forti- and such certificates shall be exempt, both as fications, and for other purposes77; and the pub- to principal and interest, from all taxation, lic resolution approved March fourth, nineteen except estate or inheritance taxes, imposed by hundred and seventeen, entitled " Joint resolu- authority of the United States, or its possestion to expedite the delivery of materials, sions, or by smy State or local taxing authority. equipment, and munitions and to secure more SEC. 7. That the Secretary of the Treasury, expeditious construction of ships,77 in the in his discretion, is hereby authorized to demanner and under the terms and conditions posit in such banks and trust companies as he prescribed in section one of this act. may designate the proceeds or any part thereof That the Secretary of the Treasury is hereby arising from the sale of the bonds and certifiauthorized to borrow on the credit of the cates of indebtedness authorized by this act, United States from time to time, in addition or the bonds previously authorized as described to the sum authorized in section one of this in section four of this act, and such deposits act, such additional amount, not exceeding may bear such rate of interest and be subject to $63,945,460, as may be necessary to redeem such terms and conditions as the Secretary of the three per cent loan of nineteen hundred the Treasury may prescribe: Provided, That and eight to nineteen hundred and eighteen, the amount so deposited shall not in any case maturing August first, nineteen hundred and exceed the amount withdrawn from any such eighteen, and to issue therefor bonds of the bank or trust company and invested in such United States in the manner and under the bonds or certificates of indebtedness plus the terms and conditions prescribed in section one amount so invested by such bank or trust comof this act. pany, and such deposits shall be secured in the SEC. 5. That any series of bonds issued under manner required for other deposits by section authority of sections one and four of this act fifty-one hundred and fifty-three, Revised may, under such terms and conditions as the Statutes, and amendments thereto: Provided Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 347 further, That the provisions of section fifty-one eminent; reports of reserves by member banks; hundred and ninety-one of the Kevised Stat- real-estate loans; Federal Reserve Bank drafts; utes, as amended by the Federal Reserve Act Federal reserve district numbers on checks; and the amendments thereof with reference to ; establishment of collection department by Fedthe reserves required to be kept by national banking associations and other member banks eral Reserve Banks; transit time schedules and of the Federal Reserve System, shall not apply domestic exchanges; establishment of branches to deposits of public moneys by the United and agencies; problems of collection and clear- States in designated depositaries. ances; proposed amendments to Federal Re- SEC. 8. That in order to pay all necessary serve Act; abrasion of gold; direct redemption expenses, including rent, connected with any operations under this act, a sum not exceeding of unfit Federal Reserve notes; joint custody one-tenth of one per centum of the amount of of funds held by Federal Reserve agents; purbonds and one-tenth of one per centum ol the chase of acceptances; enlistment by Federal amount of certificates of indebtedness herein Reserve Bank employees in military forces of authorized is hereby appropriated, or as much the United States; surety bonds held by Fedthereof as may be necessary, out of any money in the Treasury not otherwise appropriated, to eral Reserve Banks; abstracts of clearing house be expended as the Secretary of the Treasury figures and trade acceptances. may direct: Provided, That, in addition to the The conference adjourned subject to call of reports now required by law, the Secretary of the chairman without definite time or place the Treasury shall, on the first Monday in Debeing fixed for next meeting. cember, nineteen hundred and seventeen, and annually thereafter, transmit to the Congress a detailed statement of all expenditures under this act. State Banks Admitted. The following State banks have been ad- Conference of Governors. mitted to membership in the Federal Reserve The tenth conference of the governors of the System during the month of April, 1917: Cleve- Federal Reserve Banks was held at the Shore- land Trust Co., Cleveland, Ohio; St. Louis ham Hotel, April 4 to 6, inclusive. There were Union Bank, St. Louis, Mo.; Farmers State present: Governor A. L. Aiken, of Boston, Bank, Kasson, Minn.; Peoples Bank, St. Paul, chairman; Governor Seay, of Richmond; Gov- Minn. ernor Rhoads, of Philadelphia; Governor Wold, of Minneapolis; Governor McCord, of Atlanta; Federal Reserve Drafts. Governor Van Zandt, of Dallas; Governor Fancher, of Cleveland; Governor McDougal, Forms of special drafts on Federal Reserve of Chicago; Deputy Governor Treman, of New Banks have been prepared and sent with the York; Deputy Governor Calkins, of San Fran- necessary suggestions as to their use to the 12 cisco; and Mr. J. F. Curtis, secretary. Federal Reserve Banks. Use of these drafts The Federal Reserve Banks of St. Louis and will begin on May 21. They are the result of Kansas City were the only banks not repre- careful study of the question of transfers by sented. the Board and the banks. The governors held several conferences with Drafts drawn by member banks on their own the Federal Reserve Board during the course Federal Reserve Bank immediately available of their meeting. at par at any Federal Reserve Bank but actually Among the subjects discussed were: Delays payable only at the Federal Reserve Bank on in the mails; direct interdistrict routing of which drawn are, for the present, limited to items; disposition of Government bonds; Fed- sums not exceeding $250. Transfer drafts eral Reserve Banks as fiscal agents of the Gov- | payable on advice at any Federal Reserve 93720—17 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

348 FEDERAL RESERVE BULLETIN. MAY 1, 1917. Bank specified are limited to sums in excess of The drawing bank shall be required to give $250. Advice to the drawee Federal Reserve advice by mai] to its Federal Reserve Bank of the total amount of drafts drawn each day. Bank by the member bank is required in either These drafts on a Federal Reserve Bank case. when received for immediate availability by Extracts from the instructions issued to another shall be listed in a special letter and Federal Reserve Banks under date of April 24 forwarded to the drawee Federal Reserve Bank are given below: for credit. If the total of the letter justifies there can be an advice by wire and entries made on the day FEDERAL RESERVE DRAFTS. the letter goes forward. There shall be two special forms of drafts on each Federal Reserve Bank which will be FEDERAL RESERVE TRANSFER DRAFT. available for immediate credit at other Federal Reserve Banks. The "Federal Reserve Transfer" draft shall The privilege of drawing these drafts shall be the draft drawn by a member bank upon its be extended to all member banks complying own Federal Reserve Bank and made payable with the regulations to be formulated by their on advice of the drawee at any Federal Re- Federal Reserve Banks. serve Bank specified in the draft. The drawing of these drafts shall not inter- They shall, for the present, be drawn for fere with member banks drawing the ordinary amounts in excess of $250. checks on their Federal Reserve Banks. The drawing bank shall be required to give The special drafts provided for in this circu- advice by mail to its Federal Reserve Bank of lar must be drawn on forms approved by the the numbers, amounts, and total made payable Federal Reserve Bank of which the drawing at each Federal Reserve Bank of drafts drawn bank is a member. The forms are to be simi- each day. This advice shall be under an aular to the specimens embodied herewith. thorized signature and a duplicate shall be for- Any Federal Reserve Bank may, if in the warded to the Federal Reserve Bank at which judgment of its officers it becomes necessary, the drafts are made payable, the duplicate make a reasonable charge against member advice to contain the signature in ink of offibanks drawing these drafts for the purpose of cers signing the drafts. effecting transfers of funds, such charge not to The drawee Federal Reserve Bank shall, exceed the rate for transfers prevailing at the upon receipt of advice from the drawing memtime the drafts are drawn. ber bank, telegraph the Federal Reserve Bank All of these drafts shall be immediately at which the drafts were made payable, concharged to the drawing member bank's ac- firming the advice * * *. count on receipt of advice by the drawee Federal Reserve Bank. Specimen forms of ad- Under existing regulations governing the vice are inclosed with this circular. gold settlement fund any Federal Reserve The two kinds of drafts shall be known as "Federal Reserve Exchange77 and "Federal Bank can at any time obtain a settlement on a net balance c(ue from another Federal Re- Reserve Transfer" drafts. serve Bank. This plan shall become operative on the 21st FEDERAL RESERVE EXCHANGE DRAFT. day of May, 1917. The "Federal Reserve Exchange" drafts [Inclosures.] shall be the draft drawn by a member bank FIRST NATIONAL BANK. upon its own Federal Reserve Bank and made receivable for immediate availability at par at WACO, TEX., any Federal Reserve Bank, but actually pay- To Federal Reserve Bank of Dallas. GENTLEMEN: We have this day drawn checks on Federal Reserve able only at the drawee Federal Reserve Bank. Exchange form, the total amount of which is $ They shall, for the present and until otherdollars. wise provided, be drawn for amounts not in Charge our account to cover. excess of $250. R. P. DUPEEE, Cashier. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 10.17. FEDERAL RESERVE BULLETIN. 349 FIRST NATIONAL, .RANK. ! 48-1 No WACO, TEX., ... To Federal Reserve Bank of Dallas. \i \ u ! FIRST NATIONAL BANK. WA co, TEXAS, We have this day drawn checks on Federal Reserve Transfer form as • listed below, payable on advice from you at the Federal Reserve Bank j Pay to the order of 55 of Dollars. To Federal Reserve Ban!: of Dallas 32-8 Number. f Amount. Number. Amount. Cashier. The Federal Reserve Hank of. will pay this check upon advice of drawee- | Foreign War Loans. i I The following condensed statement showing Total.... | I approximate amounts of war loans raised by I the principal belligerent countries since August Charge our account with total and arrange for payment. Respectfully, | 1, 1914, has been compiled by the division of Cashier. \ statistics of the Federal Reserve Board in an- FIRST NATIONAL BANK. I swer to inquiries on the subject: WACO, TEX., ... To Federal Reserve Bank of | United Kingdom (Mar. 31, 1917) 1 518, 805,000,000 We have this day drawn checks on Federal Reserve Transfer form as liisstteedd bbeell ow7payable by you on addvi ice ff rom tthh e Feddle raRl Reserve BBaknk ! France (F<*>- 28> 1917) 10, 500, 000, 000 of Dallas. * Germany (Dec. 31, 1916) 211,226,000,000 Russia (Dec. 31, 1916) 7,896,000,000 Number. Amount. Number. Amount. Italy (Dec. 31, 1916) 3 2, 520,000,000 Austria (Dec. 31, 1916) 4 5,880,000,000 Hungary (Dec. 31, 1916) 1, 730,000,000 Total « 53,113,000,000 1 I l Figures for the United Kingdom are apparently exclusive of $704,- | 120.000 of currency notes issued by the Government and secured to the i i extent of 19.7 per cent by gold. ; 2 Subscriptions to the sixth German war loan have recently been comi pleted. This loan is reported to have yielded over 3 billions of dollars, i Total.... i i In addition to the funded debt, the Government at the end of Februaryy i ; 1917, had outstanding over 80 million dollars of Treasury notes, about 800 i million dollars of war loan bank notes, and an unknown amount of lis ( t S ed ig ') nature in ink and title of officers signing any of the checks above I Trcasury t,ms 3 Includes 154 millions of treasury notes secured to the extent of 12.8 per cent by a metallic reserve held in the Government treasury. * A considerable proportion of the loans of the Austrian Government (Form of draft.) was obtained in the shape of temporary advances from the Austro- Hungarian Bank at nominal rates of interest. The amount thus obtained is given on page 330 of the April Federal Reserve Bulletin as 48-1 No $1,304,250,000. FIRST NATIONAL BANK. WACO, TEXAS, . 6 The total includes the advances made by the United Kingdom and France to the smaller belligerent countries allied with them. No figures Pay to the order of. are available showing the additional amounts received through domestic Dollars. loans by the Governments of the smaller countries, such as Roumania, Servia, and Belgium on the one hand and Turkey and Bulgaria on the To Federal Reserve Bank oj Dallas 82-3 other. Figures shown for Germany and Austria are apparently exclusive of the advances made to Turkey and Bulgaria, regarding which Cashier. no official information has been published. Neither do these figures Any Federal Reserve Bank will receive this check for imme- include the considerable amounts raised through loans by the British diate availability at par. dominions and colonies: e. g., Canada, Australia, New Zealand, South Africa, and British India. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

850 FEDEKAL EESEKVE BULLETIN. MAY 1, 1917. Growth of the Bank Acceptance Business. ning of March, 1917, are as follows (in thousands of dollars): In continuation of similar figures shown on page 590 of the October Bulletin, there are pre- Nov. 17,1916. Dec. 27,1916. Mar 5,1917. sented below data indicating to some extent the growth of the bank acceptance business in the All national banks 98,231 100,342 101,485 Old Colony Trust Co., Bos- United States since November, 1916. It is seen ton 2,685 6,162 5,443 Other trust companies in that while the reported acceptance liabilities Boston 0) 0) 1,063 State banks and trust comof the national banks have grown but little panies in Maryland 3,308 3,973 3,330 between November, 1916, and March, 1917, Nov. 29,1916. Dec. SO, 1916. Feb .28,1917. Trust companies in Greater those of the trust companies and State banks New York 78,631 79,400 95,480 in Greater New York have increased over 20 State banks in Greater New York 4,773 2,095 6,546 per cent during the same period. It should be Trust companies in State of New York 136 486 noted, however, in this connection that figures State banks in State of New York 22 (l) 12 of acceptance liabilities of national banks for Total. 187,786 191,972 213,845 November and December in some cases are inclusive of amounts of the reporting banks7 i No data. own acceptances held as investments by the The totals just given are exclusive of data accepting institutions, while March, 1917, fig-for the larger private banking firms and Ameriures are exclusive of such amounts. On can branches or agencies of foreign banks, March 5, the national banks in New York City which make no reports of their acceptance held over 30 million of their own acceptances, liabilities either to State or Federal authorities. while like holdings of New York City trust The Federal Reserve Banks report aggregate companies and State banks at the. end of holdings of bills accepted by private bankers as February amounted to about 8 million dollars 13.8 millions about November 20, 1916, and as The volume of outstanding acceptances re- 20.5 millions about March 5, 1917. Estimates ported by the latter is slightly larger than the of the amounts of outstanding bills accepted by volume shown for all national banks in the jprivate banking firms vary between 30 and 50 latest report of the Comptroller of the Cur- jmillions, while a recent estimate of the New rency. ; York Commercial gives the amount of bills accepted by American branches and agencies Acceptance liabilities of national banks in principal cities of j of foreign banks as about 20 million dollars. the United States at specified dates. j A certain amount should also be added for ac- [In thousands of dollars; i. e., 000's omitted.] ceptances of trust companies and State banks outside of Boston, New York and Maryland. I Nov. 17, Dec. 27, Mar. 5, ! 1916. 1916. 1917. No definite information was obtainable regarding acceptance operations of nonmember banks New York j 55,312 53,116 50,720 Boston | 15,263 18,407 21,835 other than those shown in the above table. It Philadelphia. 8,640 8,309 8,849 Baltimore 482 520 463 is probable, however, that the total acceptance New Orleans 4,101 3,411 1,962 Charleston, S. C. 1,224 1,250 1,300 liabilities of all banks and bankers in the United Chicago 1,859 2,356 1,480 Minneapolis 695 2,401 ! 4,272 States exceed at present 300 million dollars. San Francisco... 3,696 3,738 ! 2,869 Allother 6,959 6,834 ! 7,735 Total ! 98,231 100,342 101,485 German War Loans. Available data regarding acceptance liabili- In continuation of similar figures on page 14 ties of American banking institutions about the of the January, 1917, Bulletin there are shown end of the calendar year 1916 and the begin- below the classified number of subscribers and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAT 1, 1917. FEDEEAL RESERVE BULLETIN. 351 amounts subscribed to the fourth and fifth , The Board understands that it has been the German war loans issued in March and Sep- Ipractice hitherto for Federal Reserve Banks to deposit gold or lawful money with the Federal tember-October, 1916. j Reserve Agents, or to make substitutions of The total number of subscribers to the fifth other paper with him, for commercial paper loan was 27.9 per cent less than the number of iheld as security for Federal Reserve notes subscribers to the fourth loan, while the aggre- jabout 10 days in advance of maturity, in order gate of subscriptions received is practically ;that the banks may have possession of the paper for the purpose of collection. This the same. | process impairs the note issuing capacity of the A comparison of the classified subscription |banks, and as counsel is of the opinion that a data for the two loans discloses the interesting IFederal Reserve Agent may designate as his fact that any increases in the subscription \ collecting agent the Federal Reserve Bank from which he has received notes and bills as collatfigures of the fifth loan are limited entirely to j eral security for Federal Reserve notes, the the higher groups. From the table below it • Board has ruled that henceforth Federal Remay be seen that the number of large sub- serve Banks need not make substitutions of scribers to the fifth loan (i. e., with subscrip- paper or deposits of gold or lawful money with tions of 100,000 marks and over) increased 16 the Federal Reserve Agent until the actual due date of the paper originally pledged to secure per cent and the amount of large subscriptions notes. 23 per cent. On the other hand the number The Federal Reserve Agents are therefore of smaller subscribers (with subscriptions of authorized to turn over maturing notes and less than 100,000 marks) shows a decrease of bills to their respective Federal Reserve Banks 28 per cent and the aggregate of their sub- for collection upon the execution by the bank scriptions a decrease of 19.5 per cent. of a receipt reciting the fact that the notes and bills are taken for collection only, settlement to be made with the Federal Reserve Agent in Total gold or lawful money on the dates the notes and Num sc b r e ib r e o r f s . sub- cr I e n a - se a s m m cr o il i u l b i n e o d n t s s ( u i o n b f - cr I e n a - s b su il b ls s t f i a t l u l t d e u d e u a n lr l e e a s d s y o th fo er r e t l h ig e ib m le a p t a u p ri e n r g h a p s a b p e e e r n . Size of subscriptions. (+ de )o - r marks). (+ d ) e o - r Such notes or bills should be indorsed to the crease crease Federal Reserve Bank "for collection for ac- Fourth Fifth Fourth1 Fifth loan. loan. loan, j loan. count of the Federal Reserve Agent," or a rider may be attached to them showing that they 1" P.ct. . ct. are delivered to the Federal Reserve Bank for 1-200 marks 2,406,118 1,794,084 -25.4 201 154 -23.4 collection, in order that any banks used by the 200-500 marks 967,929 681,027 -29.6 407 293 -28.1 500-1,000 marks 885,491 605,494 -31.6 794 552 30.5 Federal Reserve Bank in making the collection 1,000-2,000 marks 467,724 301,869 -35.5 792 520 -33.4 may be on notice. 2,000-5,000 marks 347,725 245,873 -29.3 1,247 911 —27.0 5,000-10,000 marks.... 113,927 93,189 -18.2 907 763 -15.9 10,000-20,000 marks... 42,158 40,571 - 3.8 666 651 - 2.3 20,000-50,000 marks... 30,361 28,500 — 6.1 980 982 50,000-100,000 marks.. 9,100 9,748 + 7.1 734 810 +io."4 5 1 0 0 0 0 , , 0 0 0 0 0 0- - 5 1 0 ,0 0 0 ,0 0 0 ,0 0 0 0 m m ar a k r s k . s . 6,3 7 0 8 8 0 7 1 , ,0 8 3 7 2 0 + + 3 2 2 4 . . 4 8 1,5 0 3 4 1 1 1,7 8 1 5 0 31 + + 1 3 1 3 . . 7 1 National Banks and the War. Over 1,000,000 marks.. 574 725 +20.4 1,812 2,448 +35.1 Total. 5,279,6453,809,976-27.9 10,712 i 10,647 |- .6 National banks of the United States are taking an important part in the various activities incident to the entry of the United States into Substitution of Collateral. the war. Much literature furthering various For the assistance of Federal Reserve Agents plans has been issued by banks and by banking in making substitions of paper or deposits of associations. Most of the circulars are unusual gold or lawful money when the original pledge in their appeal and indicate an admirable patriis collectible, the Federal Reserve Board on otic spirit. As indicating the general line of April 12 sent out the following letter providing matter which is being sent out, there is refor substitution of securities: printed below a copy of a letter issued by the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

352 FEDERAL RESERVE BULLETIN. MAY .1, 11)17. Ohio Bankers7 Association on April 10 to itsI employees who go into active service; we can members: | provide for those dependent upon such employees while they are in the service, and we To the ever-present question, "What can we I can agree to continue to help if they fail to bankers do to help?" one of the officers of our come back. We can make it plain to every association attending the last meeting of our customer who comes to our desks that when council of administration offered an answer we must refuse accommodation it will be, first which seemed so much to the point that the of all, to thoste who attach more importance to council requested that it be reduced to writing their own private interests than they do to and mailed to all members. It follows: tbof'se of their country. First of all we can face the facts. Without We can preach economy in time and otit; waiting for unpleasant events to focus our at- we can practice economy of the most rigid kind tention and possibly bring us vain regrets, we both at home and in the bank; we can concan look the situation squarely in the face and stantly remind ourselves and others that wastes know it for what it is. This war is our war. of every kind increase the burdens of all; that It is not just anybody's war. It is the war of every hour of time, every stroke of labor, every every American citizen. War means sacrifice dollar of money that" can be saved helps some and hardship, and our war means our sacrifice one some way, and that extravagance, always and our hardship. From this time on there a vice, has now become almost an act of are to be but three kinds of people in this treason. country—those who bear the burdens; those Between the frenzied hysteria which, miswho would but can not; those who can but taking itself for high patriotism, spends itself would not. And of these three the last will be in vocalizing the superlatives of our language, disloyal citizens; disloyal ones of whom the and the wilful indifference which, parading in most disloyal will be those who add to the the solemn garb of 'common sense, denies the crime of evading burdens that of seeking to seriousness of our crisis, there is a sound attitake a money toll from the travail of the tude of mind which means readiness to underoccasion. stand, willingness to sacrifice, and promptness Next, we can run our banks with an eye to do. This attitude it can bo our privilege to single to safety and public service. We can take and unswervingly maintain. forget for the time that "we are in business And lastly, we can be vigilant in our watch to make money." We can remember that | for opportunities to serve in new ways. Of there is a fiscal as well as a physical firing line, ; all men we should be among the first to know and that if most of us are too old or too infirm| opportunity at sight, to seize it boldly, and to fight, substantially all of us can render im- to act upon it promptly. portant service in the civil legion. We can Then, having done all of these things, and request authority from our directors to go to having done them cheerfully and with the most the limit of safety in extending preferential cordial good will, we can remember that what credit to governments and to all others en- i we have done is as nothing compared with gaged in activities that directly affect the issue. j what those who go into active service have We can hold places open for any and all of ourI shown themselves ready to do. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1. 1917. FEDERAL RESERVE BULLETIN", 353 GOLD SETTLEMENT FUND. The figures below cover the period between the settlements of March 22 and April 19. Holdings of gold by Federal Ecserve Banks They show obligations settled amounting to and Federal Reserve Agents in the gold settle- $1,186,772,000 by means of the weekly settlement fund of the Federal Reserve Board ment, and $28,122,500 by means of transfers reached the sum of $355,040,000 on April 19. between the banks during the week. Changes This amount exceeded figures previously pub- I in ownership in the fund amounted to 4.37 per lished in the Bulletin by §30,440,000. This j cent of the total obligations settled. Chicago, maximum was accompanied by a settlement j Cleveland, Philadelphia, and Boston show the on April 19, amounting to $338,894,000. It j largest increases. was the heaviest settlement made, the largest | previous settlement having been on March 22, | Amount of clearings and transfers, Federal Reserve Banks, from Mar. 23, 1917, to Apr 19, 1917, inclusive. when the transactions liquidated amounted to [000 omitted.] $297,765,000. Payment was made to the Treasury Depart- j Total Balances j Transclearings. adjusted. | fers. ment through the gold settlement fund on \ March 31, for 2 per cent bonds purchased by j Settlement of— Mar. 29, 1917 S294,766 §13,359 86,800 member banks under section 18, amounting to Apr. 5, 1917 259,606 12,080 300 Apr. 12, 1917 293,506 23,904 1,622 $10,884,090.15. In addition there was depos- | Apr. 19, 1917 338,894 18,772 19,400.5 ited on the same date for two Federal Reserve j Total 1,186,772 68,115 28,122.5 Banks $1,732,000, covering 3 per cent 1-year Previously reported for 1917. 3,221,868 182,871 70,482 certificates of indebtedness which had been j Total since Jan. 1,1917 4,408,640 250,986 98,604.5 Total transfers Jan. 1,1917, to date . 98,604.5 sold by the banks, payment of which had to be j Total for 1916, including transfers... 5,633,966 Total for 1915, including transfers.. 1,052,649 provided for through the Treasurer of the j Total clearings and transfers United States. I May 20,1915, to Apr. 19,1917. 11,193,859.5 Changes in ownership of gold. [000 omitted.] ! J Total changes from Total to Mar. 22,1917. ! From Mar. 23, 1917, to Apr. 19,1917, inclusive.1 : May 20, 1915, to 1 | Apr. 19,1917.2 ...._ j Balance to Federal Reserve Bank of— credit, Mar. 22,1917, Balance, Decrease. Increase. plus net Apr. 19, Decrease. Increase. ! Decrease. Increase. deposits of 1917. gold since that date. Boston S34,785 813,957 $20,552 §6,595 $41,380 New York.... 3358,759 71,219 21,992 G 997 $407,986 Philadelphia.. 74,631 11,042 18,071 7,029 81,660 Cleveland 32,607 18,742 30,753 12,011 44,618 Richmond 21,785 17,203 15,325 1,878 19,907 Atlanta 21,891 3,625 5,631 2,006 23,897 Chicago 21,310 24,928 41, 752 10,824 38,134 St. Louis 5,880 2,936 5,973 3,037 8,917 Minneapolis.. 9,521 5,148 6,351 .1 1,203 10,724 Kansas City.. 52,675 22,807.5 25,258 2,450.5 55,125.5 Dallas. 31,935 7,353.5 5,345 2,008.5 |. 29,926.5 San Francisco. 51,739 8,269 10,227 1,958 53,697 Total.- 358,7f>9 358,759 207,230 207,230 53,113.5 53.113.5 407,986 407,986 Changes in ownership of gold daring period Mar. 20, 1917, to Apr. 19, 1917, equal 4.37 per cent of obligations settled. Total changes in ownership of gold since May 20,1915, equal 3.64 per cent of total obligations settled. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

854 FEDERAL RESERVE BULLETIN. MAY 1, 19.1.7. Gold settlement fund—Summary of transactions from Mar. 23, 1917. to Apr. 19, 1917, inclusive. [000 omitted.] Balance Gold. Weeklv settlem A e p n r t . s 1 f 9 r , o 1 m 9 1 M 7. ar. 23,1917. to 1 A 91 p 7 r , . b 1 a 9 l , - Federal Reserve Bank of— j I m as e t n s t t , a M te a - r. j f a u n n c d e i a n t 22,1917. d W ra i w th n - . : D it e e p d o . s- rCwreidiitt , |j T d o e t b a i l t s n et I d T ob o i t t a s l c T re o d t i a t l s . ! | T c o re ta d l i n ts o . t • I ; c b l u os si e n e o s f s. Boston ' 821,015 $7,058 ; S3,757 $103,633 i 820,552 New York i 20,241 4, 022 31,527 306,646 | 21.992 Philadelphia I 17,441 6.699 ' 1,586 177,742 18', 071 Cleveland j 26,017 7,375 : 485 80,022 30.753 Richmond 17,085 1.712 . 666 72,008 15,325 Atlanta : ! 4,431 L566 . 1,177 38,239 5,631 Chicago i 43,870 18,942 '•• 18,918 160.301 ! 41,752 St. Louis i 4.240 1,584 ; 99;903 j 5,973 Minneapolis ; 8,6 -11 3,493 3.425 23.420 ! 6,351 Kansas City •• 26,152.5 3,345 '693 69.766 I 25,258 Dallas ! 7,567.5 564 1,349 29,039 5,345 San Francisco j 14,509 6.500 i 1,833 26; 053 10,227 Total ! 211,270 62,860 5,115 ' 1,186,772 1,186,772 : 68,115 I 207,230 Federal Reserve Agents1 fund—Summary of transactions, Mar. 23, 1917, to Apr. 19, 1917, inclusive. [000 omitted.] ! Balance With- De- Balance i! t B o a c la re n d c i e t Federal Reserve Agent at— drawn.posited. Apr. 19, |; Federal Reserve Agent at— Mar. 22, 1917.. 1917. Philadelphia $15,890 ! S900 $5,600 \ $20,590 Minneapolis ! S3,130 Cleveland 4,000 5.500 i 9.500 Kansas City I 17,660 Richmond 9', 000 1,900 1,000 I SilOO Dallas I 8', 880 Atlanta.... 13,420 1,450 1,060 j 13,030 San Francisco ! 15.010 Chicago.... 20,290 17.480 j 37,770 St. Louis.. 6', 050 7S0 1.000 ! 6,270 Total j 113,330 i Operations of the Federal Reserve clearing system, Mar. 16 to Apr. 15, 1917. b I ( a t d e n r a m e k i s l s s y e r i d v n a r v e a F e w r c e a i d n t g e y e o r ) a n . l b I o t ( a e u d n r m t a e k s i s i l s s d e y i r e d n v a r F e a v d e w e i d c r s n a i e t t r g r y o i a e c n l ) t . I d b te i a s m n a tr k v s i s c e d r t i s r a n a g ( w o e d ) t n a h . i e l o y r n T T r i o e t S t e a a s m t l a u a t s ( v r e e e e d s x r r ) r c a a o l g ( w u f d e s a U ) n i . i v l n o e y i n o te f d ( o d U I n a t n e i T l m i y t r e e s a d a v d s S e u ra r t r a a e w g t r e n e o s ) f . b M a b e n e m k r 's - m w b N f e r a h o m o n i m n c k b h - s er in dis- checks trict. arc col- Num- Num- Num- Num- Num.-1 lected ber. Amount. ber. Amount. ber. Amount. ber. Amount. bcr. jAmount. at par. Boston 1,947 156,715,272 32,963 S3,556,484 2,570 $4,083,393 37,480 14,355,149 1,107 $111,600 393 248 New York 3,554 Jl8,031.017 23.844 5,178,543 15,560 8,184,337 42,958 31,393,897 5,266 1,712,348 625 424 Philadelphia 10,566 I 9,272; 452 17,526 2,141.881 6,479 7,203,515 34,571 18,617,848 673 85,343 632 242 Cleveland 960 2,035,347 14,289 5.902.736 1,083 1,095,993 16,332 9,034,076 248 23,429 753 505 Richmond 1,027 2.078,065 13,263 3,520', 200 1,539 2,513,869 15,829 8,142,134 176 20.190 519 271 Atlanta 1.021 783,322 9,806 1,691,239 1,599 1,431,303 12,426 3,905,864 175 21,937 382 397 Chicago 4,699 8.261.217 12.692 2,579,641 1,469 4.889,274 18,860 15,730,132 2.901 275, 743 1,046 1,611 St. Louis 1,486 4,281,367 8; 524 1,656,781 175 I', 545.007 10,185 7,483,155 1, 171,329 468 851 Minneapolis 2,166 3', 759,821 10,734 '815,900 573 597,932 13,473 5,203,653 2£55l 21,257 721 1,035 Kansas City 1,960 3,021,787 9,727 1.672,610 560 2,584,646 12,247 7,279,043 382 48.281 940 1,395 Dallas 1,036 1,096,666 10,481 3;158,095 322 509.154 11,839 4,763,915 12 7,980 622 339 San Francisco 740 951,609 4,758 762; 849 79 25,119 5,577 1,739,637 215 143.961 524 1,289 Total: Mar. 16 to Apr. 15,1917 31,162 60,288,002 168,607,32,666,959 32,008 34,693,542 231,777 127,648,503 12,582 2,643,408 7,625 8,607 Feb. 16 to Mar. 15,1917... 234,475 116,404,430 7,630 8,007 Jan. 16 to Feb. 15,1917.... 220,421 110,188,028 7,630 8,086 Dec. 16,1916, to Jan. 15,1917. 241,933 121.814; 589 7,622 8,130 Nov. 16 to Dec. 15,1916... 236,038 125,603,732 7,627 8,065 Oct. 16 to Nov. 15,1916... 227,489 115,061.224 • 7,623 8,059 Sept. 16 to Oct. 15,1916... 204,891 97,666,107 I 7,618 7.459 Aug. 16 to Sept. 15.1916 177,397 78,559.704 I 7,618 7,449 Julv 16 to Aug. 15,1916... 133,113 59.301,696 i 7,624 7,032 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL SESEBVE BULLETIN. 355 Experience of State Banks in Federal Reserve! [No. 1. Bankers Loan & Trust Co., Sioux City, Iowa.] System. Question 2. What advantages have you ! found from your membership in it ? We find In order to ascertain more exactly how the i that the public have confidence in the system Federal Reserve System was likely to affect | and feel that banks who are members and the interests of State banks, questions were ' under Federal supervision are being managed some time ago transmitted by a private in- ! safely. This is quite an asset to a bank and quirer, who wrote of his own motion without | especially to a new institution. ; Question. 3. What disadvantages have you knowledge of the Federal Reserve Board, to all | found from your membership in it ? There is a State banks which had been granted memberloss of interest on the balance carried with 'the ship in the Federal Reserve System, as follows: Federal Reserve Bank. The examination fees 1. What was the fundamental reason which and extra published statements; and the quesimpelled you to join the system ? tion of dividends on your stock. Question 4. Have you found your charter 2. What advantages have you found from powers in any way hampered or curtailed by your membership in it ? your membership? Our State laws permit 3. What disadvantages have you found from banking institutions to make/ loans equal to membership in it ? 20 per cent of their capital and surplus. The 4. Have you found your charter powers in Federal Reserve Banks permit but 10 per cent, which is the same as required of national banks any way hampered or curtailed by your memby Federal statute. bership ? Question 5. Have you found that member- 5. Have you found that the membership ship gives you any new powers which your gives you any new powers which your charter charter or State laws did not confer upon you or State laws did not confer upon you before? before? No; our State laws are quite liberal. Question 6. .Have you found that the regu- 6. Have you found that the regulations of lations of the Federal Reserve Board have the Federal Reserve Board have interferred interfered with your business or your methods with your business or methods of doing of doing business? No; the officers of the business ? Chicago bank are not at all dictatorial; they 7. In what way has the Federal Reserve seem anxious to cooperate in every way possible with their member banks and show a Bank collection system affected you? desire to transact their business in such a way 8. What are your general views on the adas to cause as little delay and "red tape" as visability of joining? can be reasonably expected, and frequently Replies to these questions have been ob- ask for opinions as to how the system may be tained from a majority of State member banks, changed to be more beneficial and equitable. and have been brought to the attention of the Questions 1 and 8. No. 1. What was the fundamental reason which impelled you to Federal Reserve Board. Those thus furnished, join the system? No. 8. What are your genwhether favorable or unfavorable, are here reeral views on the advisability of joining? We published in full, without exception, as afford- felt that our financial system was very weak ing the answers to questions that are frequently and faulty. That when established it was expected to be but temporary, and that our put before the Board, and which can be best great financial operations demanded a sound and most conclusively replied to on the basis and yet elastic system to meet requirements of the actual experience of banks which have during troublous times. Therefore, we felt been members of the system. that the present system should be given a fair The names of the banks sending in these trial, and in order that such a trial be had it seemed that banks should cooperate even replies are furnished only in those cases where should it mean some financial loss at first. permission was subsequently granted. Other We did not expect to find the law perfect, but banks are merely designated by number with- we had, and still have, faith that the defects out reference to any principle of classification, and weaknesses will be perfected and strengthsuch as location, capitalization, or the like. ened as they are discovered by actual testing. 93720—17 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

356 FEDERAL RESERVE BULLETIN. MAY 1, 1917. A bank can get along very nicely without being not granted by State laws, but, with the excepa member of the system during prosperous tion of the loan and reserve limits, we have not times, but should financial troubles loom up found the Federal requirements irksome. on account of labor trouble, general depression, There has been some advantage to us in war, etc., we shall feel safer for the membership using the facilities of the reserve city clearing we hold uniting us in a financial way with houses, by which we are enabled to get imme- Uncle Sam, and having this feeling we are diate use of funds that we have on deposit in willing to make the required slight sacrifice other reserve cities. during prosperous times. We have about come to the conclusion that the loss of interest on the reserve balances [No. 2. First State Bank, Dallas, Texas.] which we are compelled to carry with the Federal Reserve Bank and also the loss of interest Our fundamental reasons for joining the on the amount we have invested in the capital Federal Reserve System were because our stock of this Federal Reserve Bank are rather belief in its power to strengthen the financial high for the benefits which have accrued to us. situation all over the country, to enable us to borrow money at more reasonable rates' [No. 3. The Savings Bank of Richmond, Va.] and on shorter notice than we had been able to do with out correspondents, and for the At the time of our joining we were satisfied advertising feature which we expected to that it would not be a money-making venture accrue because of the fact that we were a State on our part, because we are not doing a combank and could also advertise that we were a mercial business, and during our experience member of the Federal Reserve System. of 28 years in business we have never redis- The advantages which we have actually counted a note. derived from this membership have been prin- 1. We look upon the Federal Reserve Syscipally in the fact that we are now enabled to tem as a financial umbrella, that in time of handle many collection points through the trouble may prove to be very useful. We also Federal Reserve System at a cost of 1J cents per believe that it is for the benefit of the entire item, whereas we formerly had to pay exchange banking interest of this country if it was on these points. brought under one government. Also, we have, to a certain extent, derived 2. None up to this time financially, but we some benefit through being able to advertise believe a large per cent of the people with that we were a member of the Federal Reserve whom we do business are not familiar with System. We have not found that there has banking matters and it is an additional inducebeen material advantage in being enabled to ment for that class of people who do business execute bills payable to the Federal Reserve with institutions who are under Government Bank and, in fact, have used this privilege supervision. very little. 3. The larger reserve required may have The principal disadvantages that we have caused us a little loss in profits. found in being members of the system have 4. None whatever. been due to the fact that we are compelled to 5. No. carry approximately $110,000 on deposit with 6. No. the Federal Reserve Bank here on which we 7. Not being a commercial bank, we are not draw no interest. Had this money been placed affected by the collecting system. with one of our reserve agents it would at least 8. I think that what I have stated in the pay us $2,200 per annum. outset covers the answer to this question. Another disadvantage has been that while under the State laws our loan limit is 25 per [No. 4. Bank of Montclair, Montclair, N. J.] cent of our capital stock, under the Federal Reserve System we are not allowed to lend 1. We believe that in union there is strength. more than 10 per cent of our capital and sur- 2. There are a number of advantages, not plus. As our capital and surplus is only the least of which is the effect upon the minds $278,000, we have at times found this limit too of our depositors; the principle one, however, small to take care of some of our larger cus- is no doubt the right of rediscount. tomers. 3. There appear as yet to be no disadvan- Our membership in the Federal Reserve tages beyond the loss of interest on balance car- Bank has given us no new powers which are ried with Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY FEDERAL RESERVE BULLETIN. 357 4. The New Jersey law did not limit amount The minds of our bank's management now of loans on collateral, whereas the Federal feel easy, as we now consider our bank to be Reserve Act limits them to 10 per cent of capi- in an independent position. Previous to memtal and fixed surplus. At first this seemed a bership, besides the carrying of a liberal cash handicap, but we now think it a good thing. reserve at all times, we depended upon banks 5. Perhaps the only addition to our powers with whom we carried balances for assistance is that of rediscounting referred to under ques- in times of business depression. Our experition 2. ence has been that such dependence is unre- 6. The regulations have not interfered with liable, for when money was tight with us our method of doing business in any way money was just as scarce, if not more so, with worth noticing, except perhaps to a slight de- them. gree in the requirements as to separation of The disadvantages that we have found from the various kinds of money. our membership in the Federal Reserve Sys- 7. The Federal Reserve Bank collection sys- tem are— tem we regard as perfectly splendid, as it re- Some additional work caused by our being duces our labor considerably and gives us required to make reports of bank's condition much quicker returns on items. both to the State Department and the Comp- 8. We believe every bank in the country troller of the Currency. We are not required should become a member and are really sur- to publish the national form of statement if prised that we delayed joining as long as we the call for a statement is made by the State Department for the same date called by the comptroller. [No. 5. German American Bank, Minneapolis, Minn.] The Minnesota banking laws permit its banks The fundamental reasons which impelled our to loan to any one individual, firm, or corporabank to join thcFederal Reserve System were— tion a sum not exceeding 15 per cent of the To provide our bank with facilities to help bank's capital and surplus, whereas the naitself in tight times and to relieve itself from tional-banking law permits loans not exceeding dependence upon other banks. 10 per cent of the same. We have not found To do our part toward establishing a bank- this to be a disadvantage, as we seldom made ing organization in the United States which loans of over 10 per cent of our capital and will, as nearly as is possible, meet the demands surplus, believing the 10 per cent rate to be the of our country in all kinds of business condi- better banking. tions. The Minnesota bank reserve requirements To gain the advantage that accrues to banks are more liberal than those of the Federal sysunder national supervision as against banks tem. This is not a disadvantage to us, because under State supervision, by reason that the we have always found it necessary to carry a public regards the national supervision and greater reserve than the minimum required by control better and stricter than, that of a State. either of the banking systems. The advantages and benefits that we have We have not found our charter powers in any found from our membership in the Federal way hampered or curtailed by our member- Reserve System are as follows: ship, as the Federal Reserve Board permits a Being a State bank, we advertised the fact State bank to retain and use the powers of our membership in the Federal System. granted to it by its State charter unless same Our membership began August 30, 1915. Our has powers which are in conflict with prudent ( bank's total deposits on that date were j banking. $2,883,000. On March 5, 1917 (called state- We have found that the regulations give us ment), our deposits were $4,142,000, a gain, rediscount privileges and currency whenever since membership, of $1,259,000. needed. By reason of our ability to secure funds by The regulations of the Federal Reserve rediscounting at the Federal Reserve Bank we Board have not interfered in such a manner as are now able to run on a much lower cash is objectionable to us, with our business, or reserve than formerly. The difference of re- our methods of doing business. We are perserve necessary is of sufficient amount that mitted to do and are doing our business in the this amount loaned more than makes up the same way and manner as before membership, loss of interest on our balance at the Federal excepting that our reserves must be kept ac- Reserve Bank. cording to the laws of the Federal system and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

358 FEDERAL RESERVE BULLETIN. MAY 1, 1917. that our limit for loans to any one person, etc., [Bank No. 6.] has been reduced from 15 per cent to 10 per cent of our capital and surplus, all of which is Our reasons for joining are, first, that our not objectionable to us, as explained under a competitor here is a national bank, and being previous answer in the foregoing. a rather small town they were using this fea- The Federal Reserve Bank collection system ture largely as an advertising scheme. has affected us in that it costs us less to collect Second, in the fall of 1914, with cotton our out-of-town items. The Minneapolis banks, main product selling at 5 and 6 cents and for previous to the time the Federal Reserve Bank quite a time not selling at all, it looked like we made collections, did not charge exchange on might need the advantages of a system that their own checks unless eastern exchange was would handle any eligible paper we might necessary or requested in payment. As the desire to discount, and our correspondents, Federal Reserve Bank now receives many of like us, could not make any promises. Again, our checks, therefore we now use less eastern we had been discounting paper at 6 per cent exchange, hence need to carry a smaller bal- (the usual charge) which after allowing the ance in our eastern connections, which lessens interest in advance really run to about 6J per our operating reserve requirements. We are cent, whereas the Federal Reserve Bank was gainers by the arrangement. taking commodity paper at 4J per cent. Our general views on the advisability of! The advantages we find as a member of the joining the Federal Reserve System are that! Federal Reserve System are that they will we believe the Federal Reserve Banking Sys- take any amount of eligible paper we might tem to be the best banking system ever care to discount at the prevailing rate, which devised by the United States or any other is at all times nearly 2 per cent under the country for the service and protection of the regular charge of the large city banks in Texas. financial and business interests of our country, We feel no uneasiness as to how the present its people, and for the protection of the member international situation might affect financial bank itself. interests. We are assured that any reason- It must be admitted that the banking situa- able accommodation will be immediately tion as it now exists in the United States granted, and conditions could possibly reach a where there are as many banking systems, you stage where the large city banks in our dismight say, as there are States—none of the trict might not feel justified in discounting the State systems equipped to assist their members paper we might offer. We look upon the sysin times of pressure, and the fact that a great tem as not only being advantageous at all part of the banks of our country both in num- times, but especially so under present prevailber and resources are State banks not members ing conditions. of the Federal system—is not the most de- The only disadvantages we find is that on sirable condition for our country to be in should the amount of Federal stock owned by our it be visited with war or business depression. bank we only receive 5 per cent per annum, We therefore believe it our duty, not only to whereas we usually get considerably more. do our part toward building up one great, That is, so far we have received this amount in strong, efficient banking system in our country, dividends. We understand that only a few of but also to provide our depositors with every the Federal Reserve Banks are paying divifacility possible to secure for their service and dends. protection, which the Federal Reserve System Our charter powers have in no way been affords. We think that membership in the hampered or curtailed. Federal system should be especially desired The new powers we receive under the Fedby every State bank that is following the best eral Reserve membership are that, before banking methods. We believe membership joining, our State banking laws required us to would be profitable to any bank. We know keep 25 per cent of our deposits in reserve, that membership is profitable to us. Even whereas State banks in Texas who are memthough membership would not cause a money bers of the Federal Reserve System are allowed profit, even if there be a moderate loss in to maintain the same reserve as do national income, the better service and protection to !banks, which is 12 per cent. depositors and the "easy feeling" of a bank's j State banks in Texas who are not members management by reason of its membership, are are required to keep at least 10 per cent of their worth a great deal. deposits in cash on hand in the bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL KESEEVE BULLETIN. 359 This is not so bad, "but quite often 25 per cent department of the system, which in our case of our deposits in cash seemed excessive, as we have been very satisfactory. It is impossible had no use of this much but could not lend it to state what effect the fact of a bank being a out. Especially is this so during the fall season member of the Federal Reserve System has on and up to May, when our deposits are high. the public mind. I do feel, however, that it During this time we could lend on 60, 90, and can not be injurious, and in a time of stress the 120 days part of the 25 per cent if we had been public naturally would be liable to select an permitted to. institution which they knew had the facilities The regulations of the Federal Reserve to rediscount. Board have not interfered with our business In reply; to your third question, wo have in any way. It is true that a ruling cut out all found no disadvantages from joining. None of exchange, but it would have affected us just our charter powers have been hampered or curthe same if we had not joined, as all collections tailed, neither have we found that our memberwould have finally come through our com- ship has given us any new powers that our petitor, and the exchange would have been lost charter or State powers did not confer on us. in this manner. We have not found that the regulations of the Another instance where we have been bene- Federal Reserve Board have interfered with fited is that a small bank down here that our methods of doing business in any way. borrows from May to September is required to In reply to your seventh question, as I stated maintain a good balance with their corre- before, the Federal Reserve collection system spondents as the borrowing power was based has saved us money, as we now receive quicker on the balance maintained with reserve banks. returns on our foreign items and we have out- In our case possibly a S5,000 loan >yould be all standing two or three million dollars less than we would need in one month, all of which was we did before this system was started, which left with the correspondent. Now, instead of amount we are able to loan at very fair rates. borrowing in large sums, we simpty fill out an Hoping this letter will encourage you to look application for rediscount for smaller amounts, fully into this subject, and that you and your thus saving the interest on larger sums that directors will certainly see the advantages of perhaps we did not use for some time. We joining it, as I agree with you the present internow discount $1,500 or $2,000 at a time as national situation warrants all institutions needed. standing behind the Federal Reserve System. So far we have had no trouble, and the only real disadvantage we have met with is the low [No. 8. Sullivan Bank & Trust Co.,Montgomery, Ala.] rate of interest received on our Federal Reserve stock and the amount of reserve we keep with We had reason to believe that the Federal the Federal Reserve Bank which does not draw Reserve System would be a great improveinterest, but this we figure is overcome by the ment on the banking system then prevailing. low rate of interest we can discount our paper! We look with favor on anything that seems to at and in the small amounts we discount at ; be in line with normal development. If this now. I system had been in operation when war broke I upon us, hundreds of millions of dollars would [No. 7. Corn Exchange Bank, New York City.] i have been saved to this section of the country. I In the minds of a great many people, State The principal reason why we joined was that I banks have not stood as well as national banks, we felt, being the largest State bank in this coun- and it was our purpose to retain our charter try, it was our duty to join with the other large privileges, and at the same time get the adbanks in trying to make the Federal Reserve vantage in the public mind of the dual super- System a success; also the fact that when we vision of the National and State governments. were considering the subject we ascertained all It has been, however, a great comfort to the objections to the system were of a picayune us to know that it was there if we wanted to nature and not of sufficient importance to use it—like we pay for the use of water in the warrant our not joining. pipe, although we may not use it. The com- You ask us what advantages have we found modity loan facilities" have been worth a great from membership in it. I can safely say that deal to the cotton country. we have enlarged our earning capacity oy our Under this head you might class the addiability to loan a larger per cent of our deposits. tional labor and the trouble of reports which We have all the advantages of the collection we have to make. Though, after all, they re- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

360 FEDERAL RESERVE BULLETIN. MAY 1, 1917. suit in better supervision and more careful rediscount with the Federal Reserve Bank than management. with a bank which had no such right, as our Under State laws, we could loan more than State banks and trust companies have not, 10 per cent of the capital and surplus, provided unless they become members. the loan was well secured and approved by a The advantage we have found from membermajority of the directors. Now we are limited ship, outside of a feeling of complete security, to 10 per cent, as the national banks arc. It is has been that our acceptance sells in the possible that our loans on real estate may be market at a better rate than the acceptances somewhat curtailed, though we have been of other State banks or trust companies, which careful to keep them on a proper basis. perhaps are in equally good standing with us The only advantage under that section we but are not members, the difference being, as recall is the privilege of having postal savings a rule, one-eighth per cent. As for its disdeposits. | advantages, I know of none whatsoever. So far, regulations have not materially in- j Since joining, we have continued to do exterfered with our methods. I actly the same business as before, the differ- It has cost us some money, as we had several | ence being that instead of keeping so much excellent collection connections which we have i cash in our own vaults, part of it is on deposit lost. with the Federal Reserve Bank. On the principle that "The Lord takes care I know of no new powers which membership of those who take care of themselves/7 we be- gives us, except the right to rediscount. In lieve that it is advisable to be a member, and I this connection I may say that immediately therefore able to take care of ourselves directly, j upon becoming a member we began to purchase and not through somebody else, especially at in the open market the acceptances of other such times as we arc passing through, although banks and sell, or rediscount them with the our other connections have always been most Federal Reserve Bank, and have continued dependable and liberal. : this practice ever since. This is the source I of some little profit to us and accustoms the [No. 9. Broadway Trust Co., New York City.] j Federal Reserve Bank to handle the paper we I give to it. None of us have forgotten the effect panicsI The Federal Reserve Board's regulations have always had, nor the upset which follows I have not hampered us in any way. As a the issuance of clearing-house certificates, | matter of fact we have found them disposed which was the only remedy we could apply | to use every possible means of making our when the banks in central reserve cities had | membership pleasant. For instance, the exexhausted the amount of credit which they | animations made of this company by the might legally expand, but, notwithstanding | Federal Reserve Bank are made at the same the effect upon the domestic exchange situa- j time as the superintendent of banks of this tion of the issuance of clearing-house certifi-| State visits us; that is, these two examinations cates, this always tended to calm the excite- | are made as one. ment among the depositors of the banks, as the j The collection system of the Federal Redepositors realized then that if the funds at j serve Bank has affected us only to the extent the command of the banks gave out, they I that we now collect through them some of the could obtain a new supply through the issu- territory formerly collected for us by local ance of the clearing-house certificates. This banks. While possibly we have lost some reis the situation which has been created by the ! ciprocal business on account of this change, I Federal Reserve Banks. If the funds of a j find the collections are made more quickly and member bank run short, for any reason what- ; handled to our entire satisfaction. soever, the member bank has the legal right to | I, of course, think all banks should join the call upon the Federal Reserve Bank to place i system. Before actually joining it ourselves, I them in funds, either credit or currency, in I called on practically every bank in New York exchange for part of their assets. j City to obtain their ideas, and also upon a The above probably answers jom question : number of banks in Philadelphia, Boston, and No. 1, as the fundamental reason in my mind ! other cities. I found a well-defined prejudice for joining. Putting myself in a depositor's in the minds of many national-bank men, as place I feel that in time of financial pressure I well as State-bank men, but the prejudice would be-more satisfied to have my money on seemed to me to be based on a dislike" of or deposit with a bank which had the right to : lack of faith in the powers that be at Wash- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY .1, 19.17. FEDERAL RESERVE BULLETIN. 361 ington, and have to admit that in many cases jour membership causes this or not, but we give I found a great lack of information concerning jit the credit for it. the terms of the act and the workings of the j 8. We _ are well pleased indeed. We see no Federal system. In any event, I have never Ireason for staying out and the soundest reasons heard from any source * anything that I can for coming in. construe as a good reason for not joining, unless it bo the loss of earnings due to the fact- [No. 12. Mercantile Trust Co., St. Louis, Mo.] that the Federal Reserve Bank pays no interest on the balances on deposit with it. 1. The fundamental reason impelling us to On this point I feel that this loss may properly join the Federal Reserve System was because be considered as the premium on safety j it gives us national supervision and the advaninsurance. j tage of discounting our paper whenever we might find it necessary. 2. The advantages thus far found from mem- [No. 10'. Commercial Trust & Savings Bank, Joliet, 111.] j bership have been practically nil, because since I Replying to your communication relative to | the organization of the Federal Reserve System benefits of the Federal Reserve System will Ithere has been such an abundance of money say, as to the fundamental reason for joining | throughout the United States, occasioned by the system, our desire to avail ourselves of the j the European war, that we have made no use prestige which attaches to national banks as jof discounting privileges offered by the Federal distinguished from State institutions. j Reserve System. We have, however, inspired We feel that we have received an indirect iconfidence in our institution by our memberbenefit. !ship. We have discovered no disadvantages from | 3. We have had no disadvantage whatever our having joined the system. from membership, beyond the fact that we have We have not found our charter powers in any not received a dividend upon the money we way hampered or curtailed by our member- have invested in the stock of the St. Louis ship. Federal'1 Reserve Bank, but that dividend is Our membership gives us the privilege of cumulative and certainly will be earned in the availing ourselves of the courtesies and accom- near future and will pay 6 per cent; so we do modations extended through the system. not find any objection to the deferred dividend. It has increased our clerical work slightly. 4. We are in no way hampered or curtailed We have not felt the need of availing our- by our membership in so far as our charter selves of the Federal Reserve Bank collection powers are concerned, except that we are system. obliged to carry the same reserve as any of There may be some localities where the sys- our nonmerabcr bank competitors and also that tem is not of much advantage, but we feel that we are restricted to loaning not more than 10 there is an indirect benefit to be derived from per cent of our capital and surplus to any one a connection of this character where the popu- borrower. I believe in a restriction, myself, lation is made up largely of foreign born. and I believe 10 per cent is enough for any corporation, firm, or individual to borrow from [No. 11. Merchants & Farmers Bank, Oheraw, S. C] one institution; so, therefore, while we are technically curtailed, we have never exercised 1. The certainty of rediscount, if needed and the privilege to loan a greater amount. when, and at reasonable rates. 5. No; membership does not give us any new 2. As mentioned in No. 1. Also we believe powers, because our power under the State the institution is placed in a higher "atmos- charter is very broad. phere" and is of practical benefit as an adver- 6. There is no rule or regulation made by the tisement. Federal Reserve Board which can in any way 3. Absolute!v none. interfere with our business or our method of 4. No. doing business. 5. No. 7. We .find their system of collecting checks 6. Certainly not adversely. saves us and our customers a great deal of 7. We have to credit their items on us at par money and will save more when the system is on receipt, but will say that since joining the better understood. system our premiums and exchange show a 8. If you are doing a business of depositing material improvement. We do not know if and discounting, if you are taking checking Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

362 FEDERAL RESERVE BULLETIN. MAY 1, 1917. accounts and loaning your money out on com- members of the Federal Reserve System at mercial paper, it is inconceivable to me why that time, we could have rediscounted our your institution and any other doing such busi- customers' commercial paper as well as our ness, does not go into the system; first, because outside commercial paper and should probit is your duty as patriotic citizens to help ably have felt much easier than we did. Of build up the Federal Reserve System; and, course we could go to our correspondents and second, in times of stress, which are bound to borrow of them, but my experience has been come, the Federal Reserve System may be the that when we need money they generally need haven of rest which you may need in later it too, and we do not like to be in the position years. of asking for a loan. By joining the Federal Reserve System the rediscount privilege be- [No. 13. Bank of Wisconsin, Madison, Wis.] comes a right which we are entitled to and a function which is welcomed by the officials in The fundamental reason which impelled us this city. In other words, when we rediscount to join the Federal Reserve System was the with them, we do not feel that we are asking a security to individual banks afforded by the favor. system. 2. We have found the following advantages The advantages we have found from our from our membership: membership in it are the right to discount (1) Rediscount privilege. paper when needed, the low rate of interest (2) Reserves: Our reserve requirements have obtained, the certainty of currency shipments been reduced from 20 to 15 per cent. when needed, and the collection system which (3) We have the right to open foreign is in process of development. branches. We have found no disadvantages what- (4) As a member bank in the Federal Resoever from our membership in it. serve System, our acceptances will sell at a We have not found our charter powers in any lower rate than they would if we were outside way hampered or curtailed by our membership. the system. We have not found that our membership 3. We have found the following disadgives us any new powers under our charter, but vantages from our membership: we believe greater strength is given us by rea- (1) We are obliged to carry a very large son of our membership in the Federal Reserve amount of good money with the Federal System. Reserve Bank upon which no interest is paid. The regulations of the Federal Reserve (2) The mount of money which we can Board have not interfered with our business or loan to any individual, firm or corporation, is 10 our methods of doing business. per cent of our capital and surplus, whereas When generally adopted, the collection under our State laws it was 20 per cent. system will be of advantage to us. (3) No director in a bank belonging to the Our general views on the advisability of system can be a director in a competing joining are that we would certainly advise you banking institution in the same city. to join, and to do so at once. (4) For the time being we will lose some mone}^ through joining the system. [No. 14. Commonwealth Trust Co., Boston, Mass.] 4. Our charter powers have been curtailed 1. The principal reason we had for joining through the reduction of the amount we can the system was the rediscount privilege. We loan to any individual, firm, or corporation. have a very large commercial business and a | Our legal limit was $300,000; now it is $150,000. great many of our customers are borrowers However, we have lost practically no business and at times the demands on us are very large. on this account, and it is sometimes a great At the beginning of the war our call loans advantage to us to be able to say that we can could not be called and our securities could not lend more than $150,000. not be sold, as the stock exchanges were closed. 5. Membership gives us the right to estab- The demands from our customers were greater lish branch offices in foreign countries, a power than ever before, and our deposits decreased which has not been conferred upon us before rapidly. The best asset we had was our out- either by our charter or by our State laws. side commercial paper which was paid at ma- 6. We have not found that the regulations turity and the proceeds used in taking care of of the Federal Reserve Board have interfered our extraordinary demand. Had we been with our business or methods of doing business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 363 Cash.—We are allowed to carry all kinds of I It is our feeling that if you have a very large cash as reserve. j commercial business and your fluctuations in Comptroller's call.—When the comptroller j deposits are large, it would be well for you to makes "a call, we make out two additional consider seriously joining the system. It may copies, one of which is sent to the Federal cost you some money to do it, out it is a great Reserve Agent here, one to the comptroller, ! source of satisfaction to us to feel that we can and one to our State banking department, j rediscount if we want to in times of trouble. Examinations.—In the matter of examina- j If, however, you are doing a strictly trust busitions, the Federal Reserve Agent here has ! ness and your loans are all upon collateral, I can made arrangements with the State banking j see no great advantage in joining, department whereby one of his men assists the State department and takes what data he [No. 15. Central State Bank, Dallas, Tex.] needs so that there is no inconvenience from In reply to your letter of the loth, beg to say this. There must, however, be two examinathat the real reason why we joined the Federal tions made during the year. Reserve Bank was that one of our competitors 7. Up to the present time we have not taken was the first State bank in the United Slates to advantage of all the Federal Reserve Bank col- join the Federal Reserve System, and they lection facilities. Prior to entering the system featured that fact in all their advertising, and we had arrangements with a number of banks the question was asked our officers often why which involved good accounts with us and we we did not also join the Federal Reserve Bank, are feeling our way along carefully because we as the other State bank in Dallas was a member do not want to lose this business. Where it is and were making capital of that fact in their distinctly profitable to us to use the Federal j advertising, so that was the main reason for Reserve collection facilities we are doing so. our joining. However, since that time we have As an illustration of this would state that yes- j rious reason to regret it. ua( no se terday we had checks on Philadelphia amount- Our bank being located in a reserve city, ing to S2,500,000, which under ordinary cir- membership with the Federal Reserve Bank cumstances it would have taken us at least two put us on a par with the national banks in days to collect and probably more. We de- j reserve cities- It has been considerable adposited these with the Federal Reserve Bank j vantage to us in pairing checks for our country and to-day they are available to us in paying j bank customers/ our clearing-house balances. In answer to your question No. 3, will say 8. We gave the matter of entering the system that the greatest disadvantage has been the very careful consideration, and it seemed to us, amount ot cash that they require us to mainin view of the very uncertain times ahead of tain with them. us, that the need of a unified banking system Answer to question No. 4, will say that we in this country is greater than ever before, as have found our powers curtailed; for instance, only through all of the commercial banking in- I the State banks""in Texas have a loan limit of stitutions entering into it can the greatest and j 25 per cent. Membership with the Federal best development of it be realized. Conse- j Reserve Bank lessens this to 10 per cent, which quently in joining the system we felt we were . I think is a good law. However, I would say doing what little we could toward bringing the j that if I contemplated a change now to the proper conditions about. j Federal Reserve System, I would nationalize Our relations with the bank have been ex- my bank instead of operating,.under both the ceedingly pleasant. There has been absolutely State bank and the Federal charters. It is no red tape to go through in connection with cheaper. rediscounts, the only thing required being that Answer to question No. 6: No. the notes shall come due within 90 days and Answer to question No. 7: It has been a represent a commercial transaction and that we benefit to us. We have saved money by their have a statement of the concern making the collection system. note in our files. My general ideas are that it is a good thing The officers of the bank in this city are trained to belong to if you are a commercial Institution! bank men and have a great deal of ability and We have found it very convenient to rediscount are more than anxious to do anything they can our notes with them when we need to. The for the various members. Too much can not rate of interest is very satisfactory, and we have be said in praise of their work. found our paper, in nearly every case, accep- 93720—17 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

364 FEDERAL RESERVE BULLETIN. MAI- 1, U)17. table to them. As I said before, however, I 2. We are confident that our membership would not join under the State charter. I has proven an advantage to us in helping create would nationalize if I were to become a member. a public opinion favorable to our institution. We have had numerous cases of new business [No. 16. First State Bank, Bonham, Tex.] which has come to us on account of our Federal Reserve membership, and definite evidence of The fundamental reason which impelled us favorable comment on all sides. While we do to join the system was the ease with which not by any means believe that our Federal Remoney might be borrowed on class of paper serve membership is directly responsible to any carried by this bank. Patriotic motive also. great extent for this increase, we do believe The advantages we have found from our that it has aided all our other efforts for new membership in the system are the ease and business and that it would have been difficult the quickness in rediscounting notes. for us to have made the progress we have with- The disadvantage we find from our memberout it. * * * ship is having to keep large reserve without 3. We have experienced no disadvantage interest. from our membership. Our charter powers have not in any way 4. Our charter powers are in no way hambeen hampered or curtailed by our memberpered or curtailed by our membership. In ship. some unimportant particulars we have to con- We find that membership gives us no new form to provisions which are somewhat differpowers which our charter 'or' State laws did ent from the provisions of the State law. The not confer upon us before. most important of these is that we are limited The regulations of the Federal Reserve in our loans to any one person or firm to 10 per Board have not interfered with, our business cent of our capital and surplus, just as national or our methods of doing business. banks are, instead of 20 per cent, which is al- The Federal .Reserve Bank collection system lowed under our State laws. In our opinion has reduced our exchange earnings to almost this change is distinctly beneficial and decidnothing. edly in the interest of safe banking. I think it doubtful whether the advantages 5. The only new power given us which we outweigh the disadvantages, In times of did not enjoy under the State laws is the right stringency our connection would, I believe, to accept drafts drawn against imports or exbe very advantageous. ports. While the State laws do not prohibit a State bank from accepting drafts of this char- [No. .17. Guardian Trust & Savings Bank, Toledo, Ohio.] acter or any others, there is no enabling statute 1. There are two fundamental reasons which and there is at least a question as to whether impelled us to join the Federal Reserve System. we would have the power, unless it were given (a) Believing that the system was basically us under the Federal Reserve statute. correct, that it would be permanent and that 6. None of the regulations of the Federal Re- Itactically all State banks would sooner or j serve Board have hampered us in any way in ater become members, we thought it wise, be- ;transaction of our business, and the attitude of ing a new institution, to join promptly, so that j the Federal Reserve Bank of Cleveland toward our business could be developed and our poli- us has always been marked with courtesy and cies established in accordance with the sys- !a desire to cooperate in every way. tem7s requirements instead of adjusting our 7. So far, the Federal Reserve collection sjsbusiness and our policy to those requirements tem has not appreciably affected us. with more or less difficulty later on. 8. We are of the opinion that the underlying (5) We believed that there was a distinct ad- | principles of the Federal Reserve statute are in vantage to us in being the first State bank in ; the main correct, and that it is of the highest this Federal Reserve district to become a mem- jimportance, on account of the necessity of conber of the system, that it could not help Icentrating the reserves of the country as a basis but give us prestige, differentiate us from all for credit and currency, that the system, with other State banks in a favorable way, add to \perhaps some modifications, become permanent. our strength and standing in the eyes of the '•To this end we believe that it is the duty of all public, and be of great value to us in many : bankers to extend their aid and cooperation, other respects. although, of course, it is equally the duty of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 365 each banker to decide how such coopera- sary, to issue currency and in other ways extion can be adjusted to meet the needs and pand credit at a time when it is needed, when interest of his own institution. otherwise it would be contracted. It seems to me that bankers all over the However, there are other advantages, among country, national as well as State, have lost them being that whereas our borrowing in New sight of the great benefits of the system through York is always based on 20 per cent balances not being able to lose sight for a moment of the! being maintained, this phase of the question is direct disadvantage to them: i. e., the loss of ! not considered by the reserve bank in extendinterest on that portion of their reserve which I ing credit. The only requirement along this they keep with the Federal "Reserve Bank. i line that is made is that a member bank is Perhaps we should have specified this as a dis- I required to keep five-twelfths of its reserve advantage resulting from our membership in I with the reserve bank at no interest. This response to your question No. 3, for, of course,! arrangement works to the member bank's we could easily estimate quite a monetary ! benefit, whereas the New York requirement loss from this source. There will be times, j operates against them, as they require the high however, when undoubtedly we can loan closer| balances to be maintained ' at a, time when to our reserve limit on account of our ability! deposits are low and the consequent demand to rediscount when the necessity arises, but I for loans arises, while with the reserve bank: probably at all times there will be a loss in this is not the carte since, when the deposits revenue which would .not occur "under the old shrink, the reserve requirement with them also s}^stem of reserves. We are convinced, how-\ decreases proportionately and that is iko time ever, that the old. national bank reserve system, ' when the loan is wanted. was unscientific and in every way improper, I The main disadvantages, if such they can for we do not believe that an. interest-bearing;• be called, are in having to maintain the same balance can ever be a real bank reserve, and ; reserve that is required of national banks. in our opinion the education of the present- ; restricting loans that are secured by real day banker to look upon an interest-bearing . estate to 25 T>er cent of the bank's capital, not balance as a reserve has done incalculable | being allowed to loan on your own stock, and. harm and we will not obtain proper coopera- 1 in having to furnish a copy of your called tion for the building up of the Federal Reserve ! statements to both the Comptroller of the System until bankers become convinced that j Currency and to the State banking departsue!: a reserve is not a proper one and recon- | ment. cile themselves to some loss of revenue in• We have lost some exchange charges, but order to obtain a real reserve. this-has been more than offset by the wider : I par list that the system gives. [Bank No. 18.] We feel that it is the duty of every bank,, especially at a time such as we are facing, to I believe that the real fundamental reason j join the system and thus strengthen it both for our decision to become a member of the | by its membership and cooperation. system was to place our borrowing and rediscotiiiting capacity on a more stable basis. We [No. 19. Bank of Eufaula, Eufaula, Ala.] had never experienced any difficulty in borrowing what we wanted in New York (except dur- In reply to the first question: In the South. ing the early fall of 1914 when the European during the summer months it is necessary for war commenced); at the same time there was us to rediscount about the same amount of always the feeling that it was optional with . aper that we have capital. We have never New York as to whether they would handle our j ad any trouble with our New York correpaper or not, and we wished to be removed spondents along this line. In fact, they have from the danger of having our credit restricted been very liberal with their rediscounts to us. at a time when it was most needed. Our under- At the same time, there were times when we standing of the Federal Reserve law is that it felt that we were not getting the rates that we is obligatory on a reserve bank to rediscount | could have gotten had wo been entirely indefor its memoers at any time desired such paper | pendent. Every courtesy in fact, was exas is eligible under their rules. In times of a tended to us by our New York connection. At financial strain this proves a bulwark for the the same time, we never knew just exactly smaller banks to lean upon, inasmuch as the what we could expect in times of panic or Federal Reserve Board has the power, if neces- distress from our connections in New York, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

366 FSDEEAL RESERVE BULLETIN, MAY 1, 1917. For this reason, we did not feel that we, our- been my idea that loans on real estate should selves, were always safe, and that we were not not be made. protecting the people that were doing business One of the greatest conveniences offered by with us as we could should we join the Federal the Federal Reserve Bank we find to be a trade Reserve System. acceptance, a copy of which we are inclosing. Answering question No. 2: Nearly 50 per Under the State laws we can lend more than 10 cent of our loans are made upon commodities. per cent of our capital and surplus to one party, The commodity rate made by the Federal Re- provided the loan is passed upon by the board serve Bank has been ruling most of the year of directors in writing. Under the Federal law around 3 per cent, and for a few months in the you can lend the full amount of your capital and summer at 3J per cent. Our rediscounts with surplus on commodities attached to trade acthe Federal Reserve Bank at this time on com- ceptances. modities amount to $200,000. Their rate of interest on commercial paper we also find to be [No. 20. Fort Scott State Bank, Fort Scott, Kans.] on an average about one-half of 1 per cent less. Answering No. 3: There has been no disad- Question 1. What was the fundamental reatage arising from our membership in the Fed- son which impelled you to join the system ? eral Reserve System. Answer. Our desire to make our bank as Answering No. 4: The only difference where safe as possible in time of financial stringency the Federal laws and the State of Alabama laws or panic, and to furnish every possible protecvary is in the reserve. Alabama requires 15 tion for our depositors. We thought that as a per cent; 6 per cent shall be carried in the vault member of the system we would have closer and 9 per cent with the reserve agents. The connection and probably receive more prompt Federal Reserve law, as you know, requires 12 and adequate assistance should it ever become per cent total, and does not stipulate any par- necessary for us to obtain funds to pay our ticular amount to be carried in the vault. depositors. No. 5: I do not think that the Federal Re- Question 2. What advantages have you serve connection gives us any new powers that found from your membership in it ? our charter under the State did not give us. Answer. We have been allowed to keep No. 6: The Federal Reserve Bank takes the postal savings deposits of about $15,000, examination of the examiners of the State of which would have been withdrawn had we not Alabama. We were examined before we were joined the system. We did not anticipate any admitted, and again about six months later, by other advantages under normal financial con- Federal Reserve examiners. Since the time, the ditions. ruling relative to the Alabama examinations Question 3. What disadvantages have you was made. found from membership in it? No. 7: The bank collection system, inau- Answer. Was very burdensome until the gurated by the Federal Reserve, has benefited order of the Federal Reserve Board and the us for this reason: Our business is largely com- Comptroller, under date of May 3, 1916, remercial, and we handle a great many out-of- lieved us from filling out all schedules in the town checks ourselves, that we were having to national-bank statement except as to the ordipay collection charges on. We are now getting nary statement of resources and liabilities. these collected practically without cost, and it In addition to this burden we have the addimore than offsets what we lose by having to re- tional expense of the printer's charges for mit at par. printing the national-bank statements. No. 8: We would not under any circum- Question 4. Have you found your charter stances try to operate a bank in this section out- powers in any way hampered or curtailed by side of the Federal Reserve association. your membership ? There is only one difference that we know of Answer. As a member bank we are now limrelative to the laws for lending as laid down by ited to loans of 10 per cent of our capital stock the Federal Reserve Board and the State of and surplus to any one individual or firm, Alabama. This affects real-estate loans. Jn- whereas, under our State law, we were allowed der the Federal law we are allowed to lend 25 to loan 15 per cent. The Federal Reserve law per cent of our capital and surplus. Under the also places a limit upon our real-estate loans, State laws there is no limit. For a bank doing but this has not affected the amount of such a commercial business, however, it has always loans as we carry. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY I, 1917. FEDEKAL RESERVE BULLETIN. 367 Question 5. Have you found that the mem- realized that our banking system was very bership gives you any new powers which your defective. charter or State laws did not confer upon you After the act was passed creating the Fedbefore ? eral Reserve System, I examined the law care- Answer. At the time we joined the Federal fully and made a trip to Kansas City and be- Reserve System our State laws required us to came acquainted with the officers of that bank carry a reserve of 25 per cent against our de- and their manner of doing business. I felt posits, but since that time our State law has that the act was a long step in the right direcbeen amended so that it now requires the same tion and judged it a public duty for those enreserve, viz, 12 per cent for us, as required gaged in the banking business to join and lend by the Federal Reserve law. their best efforts to support the system and Question 6. Have you found that the regu- also to help cure the delects, if any existed. lations of the Federal Reserve Bank have in- We joined about two years ago and have never terfered with your business or methods of regretted doing so. doing business ? Some of the advantages are: Answer. No. However, we have consid- (1) A feeling of security because you have ered it good policy to have statements made an extra place where you can place your notes by borrowers'" on blanks furnished us by the and secure accommodation. Federal Reserve Bank, which contain more in- (2) A lower rate of discount in times when formation than our ordinary requirements for we needed extra funds. such statements. We hardly consider this a (3) It is a very good advertisement in a town burden, but really prefer the Federal Reserve like ours where there are two State banks. We blanks to the ones we had used prior to our have had no trouble or red tape in getting notes joining the system. rediscounted whenever we needed extra funds. Question 7. In what way has the Federal The disadvantages are making four extra Reserve Bank collection system affected you? reports a year and giving a more detailed ac- Answer. It has reduced our income on ex- count of interest charges, etc., than the State change that we had collected on checks drawn requires. on other banks in this city about $25 per (4) To your fourth question, will say that our month. Of course this loss of income has right to make loans to one individual or firm affected nonmember banks as well as member was reduced from 20 per cent to 10 per cent of banks. our capital and surplus. We have continued Question 8. What are your general views to exercise our right under the State laws and on the advisability of joining? the Reserve System has made no objection. Answer. We believe that the reorganiza- (5) Membership gives no new powers. tion of our banking system along the present (6) Rules and regulations of the Federal Relines has resulted in satisfying the general serve Board have not interfered with our busipublic that the banking business is now on a ness or manner of doing business. sound and safe basis. This feeling of security (7) It has not materially changed our collecamong the depositors and the public in gen- tion system or affected the income from exeral makes the chance of a panic very remote. change out here. The relief from anxiety among the bankers In conclusion, will say that we are the only themselves, including nonmembers of the State bank in Nebraska that has become a system, in our opinion, more than offsets any member of the system and, while it is someburdens and disadvantages of the system. times annoying to be in a, class different from your neighbors and business associates, we have [No. 21. Bank of Lewellen, Lewellen, Nebr.] never for one moment regretted joining the Federal Reserve System, It gives me pleasure to answer your favor of the 17th instant requesting reasons why we i [Bank No. 22.] became a member of the Federal Reserve Sys- j tern. I have spent over 50 years in active | At the time the question of our joining the business, at different times interested in banks. | system arose, we figured to a certain extent During those years I have at times been a de- | that it was the patriotic duty of all of the banks positor and at other times a heavy borrower. ! to voluntarily join, and we anticipated that the In the experiences of those years, especially dur- release of a certain percentage of our reserve ing the years of 1873, 1884, 1893, and 1907, I for loaning purposes^ would offset the loss of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

368 FEDERAL RESERVE BULLETIN. MAY 1,1 Oil by to keep in Chicago, on which we receive no reserve account with the Federal Reserve Bank. interest. However, this is not serious and We also felt that this was in a way insurance we feel that in a way this is an asset to us. both for ourselves and for our depositors, guar- The Federal Reserve Board accepts the anteeing that our customers' legitimate wants examination of our State bankir.g department would always be taken care of. In addition Iand the same report made to the banking we felt that a certain volume of business idepartment of the State is also furnished to would be attracted by our membership. \ the Federal Reserve Bank and the Comptroller No particular advantages have been found j of the Currency at Washington. and we know of no additional business received. \ We have not felt that our charter powers Wo, of course, have under present conditions jare in any way curtailed by our membership. sustained a loss on account of maintaining a We have found that the required reserve is reserve without interest, Our exchange profit less for the Federal Reserve than for the State, has been very materially reduced. We have We feel that the State department lias been been put to additional expense and serious !mellowed in many of its rulings through the inconvenience on account of the voluminous jinfluence of the Federal Reserve System. We and complicated reports called for by the\ are not yet clearing checks for the Federal Comptroller. j Reserve System, but we expect to offer them Our charter powers have in no way been | this service from now on. This is another affected by our membership. j matter, we feel, that is going to be encouraged Regulations have in no way interfered with iby the Federal Reserve System and will be our business, except at the time of joining the Iuniversal within a few years. system we were called on to sell various stocks \ Our board fceis the disadvantages are very which we held and which were very profitable ; small and that the prospects of the system's Investments. growing to be a very large factor; we are per- The collection system has made no material j fectly satisfied with our membership. change in our method of handling items. We j have always maintained and still have a large j [No. 24. Central Trust Co. of Illinois, Chicago, 111. j list of direct connections in otir territory, ! At the time the Federal Reserve System was through which we prefer to handle our items. inaugurated the matter came up for discus- Personally, I think that if the matter was sion by our board of directors and we felt that, taken up at this time our company would not inasmuch as this was to be a very large factor join the system, and I think that most of our in the banking business of this country, it was, other officers feel the same way about it. in a way, a patriotic duty of State institutions to join with the national banks in making the [Bank No. 23.J system a success. In addition to this feeling, The fundamental reason for our joining the by joining the Federal Reserve System we system was the matter of postal savings. We would then be able to go directly to tne Federal have no national bank in the city and owing Reserve Banks for funds or currency in time to the large foreign population and conse- of stress, rather than be obliged to work quently large postal savings deposit, we were ,through a national bank, as was the case under unable to obtain the same without belonging j the old Aldrich law. This latter, of course, is to the Federal Reserve System. • the great benefit to be derived from member- As to the advantages from our membership, | ship in the Federal Reserve System, acting as a will say that outside of belonging to the sys- ]sort of insurance against times of financial tern, which we feel is bound to become the ! difficulty. mainstay of the financial interest of the conn- i The operation of the law does not curtail in try, we have received no large advantage, j any material respect the advantages which we At the time we considered going into toe: enjoy under our State charter. Being in a system we consulted with our State banking ; central reserve city we are obliged, of course, department and they stated to us that they j to maintain the same cash reserves that are felt that the time was not far distant when all j maintained by national banks, but this is not a banks would be under the national system, : serious disadvantage, as we naturally would and we have the same feeling. carry about the same amount of money on In regard to the disadvantages, the only .-hand in the ordinary course of business. There one is in the matter of reserve, which we had Iare few, if any, new powers granted to us under Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAT :l; HM7. FEDERAL RESERVE BULLETIN. 369 the new system, outside of the ability to dis- No. 2. It might be worth something in the count with the Federal Reserve Bank and to way of advertising. secure currency directly whenever necessity No. 3. It forces us to make two reports at might arise. every "call," one to the State and one to Up to this time the regulations of the Federal Washington, as national banks do. The Fed- Reserve Board have not in any way interfered eral Reserve Bank does not pay the usual with our business, although, of course, they 2 per cent on daily balances, as our other have the right through the Federal Reserve correspondents. Bank of Chicago to require an examination in We are required to keep live-twelfths of our the regular order of business. They now reserve with them at all times, and in case we accept the reports which we make to the fall below for one day we are subject to a slight auditor of public accounts of the State of penalty, for every offense. Illinois, and also accept the regular reports Owing to the clearing system inaugurated made by the bank examiner, who generally not long since, this is likely to occur, for everycomes in twice each. year. We make a report thing comes through the Federal Reserve direct to the Comptroller of the Currency and Bank, they charge you with the collection to the Federal Reserve Bank of Chicago at letter at the time it leaves them. In our case, such times as a call is made for a statement by it takes a letter two days to come from Dallas the national banks of the country. to llamlin and two days to go. It is possible We, of course, are members of the Federal for us to be below the required reserve five or Reserve collection system and have been using five days before we could possibly restore it. the system to a considerable extent. This has To protect ourselves against probable penalbeen, of course, somewhat experimental in ties, we are forced to keep a greater balance character and no one knows as yet just whether with the reserve bank than we would otherthe collection system will be of real advantage wise do, inasmuch as they pay no interest on to the banks under its present method of daily balances. operation. No. 4. No. Wo feel satisfied that membership in the No. 5. We are permitted to take over com- Federal Reserve System is of a real advantage mercial paper and bills of exchange, from our and believe that it is the right thing for the customers, like national banks do, that is, State institutions to join with the national there is no special limit. banks in making the Federal Reserve System Under our State charter we could only take the basic system for the country. The idea of an amount equal to 10 per cent of our capital consolidating the reserves in the Federal and surplus. Reserve Banks seems to me correct in principle No. 6. No. and for the best interests of the country. The No. 7. It has affected our revenue in way of burden of maintaining cash reserves should be exchange seriousl}r. This would be the case, borne equally by all banking institutions and however, if we did not belong to the system, each bank, therefore, should be willing to per- for everything comes through the Federal form its part of this service. Reserve Bank, at Dallas, and they would We find that there is considerable prestige send all items, on us, to the national bank, attached to membership in the Federal Reserve at this place. System, and our own customers seem to regard No. 8. Under normal conditions internaour action as an additional safeguard for their tionally I do not see much benefit to State own interests. As you perhaps know, we are banks becoming members of the Federal the only State institution in Chicago which is a System, but as you suggest, owing to the intermember of the Federal Reserve System, and national situation which has arisen and for we have in no sense regretted our membership. the purpose of consolidating the financial strength* of the country, that puts another [No. 25. First State Bank, Hamlin, Tex.] phase to the question. I have tried to give you, in my feeble way, No. 1. Under the delusion that wo would be our experience with the system. Conditions able to rediscount our bills receivable, in case and environments in your part of the country vvo had to borrow money, at a better rate than might be quite different than with us. I don't we "would )>o able to get it from our cor- feel quite equal to the occasion of passing on d this, and for that reason you will consider what Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

370 FEDERAL RESERVE BULLETIN. MAY 1, 1917. I have said as applying to our individual Atlanta without interest, whereas if we had case only. this money with our correspondents we would [Bank No. 26.] have enjoyed interest at the rate of 2 per cent per annum upon our balances. L A desire to contribute our share toward 4. Our charter powers have not been hamthe upbuilding of a better system of finance and pered or curtailed in any way by reason of our banking. membership. 2. Practically none. 5. As our charter was exceedingly broad, 3. The tying up of about 6 per cent of our I have found no new powers granted us under capital and surplus, on which we get 6 per cent the Federal Reserve System. dividends, and the tying up of the reserve re- 6. The regulations of the Federal Reserve quired, on which we get no income. Our ex- Board have not interfered with our former perience is that we derive about 1| per cent on methods of doing business. the amount really invested. 7. The par collection of checks under the 4. We have not been materially affected. Federal Reserve Act has occasioned us some 5. Nothing except the privilege of borrowing losses in that we do not now receive the revenue direct, which with us has proven of no mani- in remittance of items which we formerly refest advantage. We have been given the ceived before the system put into operation privilege of lending on commodities to all, not the parring of items. excluding our officers, and this is not regarded 8. Whatever feeling of disapproval and disexcessive lending. trust of the S3Tstem we may have had, it has 6. No. been put aside in a much larger view that the 7. This, our experience shows, is a positive Federal Reserve System has come to stay, and hardship to the banks deriving a fair return for it becomes a duty not to oppose it, but to coservices rendered, and for us member banks to operate to its improvement. This we believe tie up additional funds above the required can best be done by a full membership, and our reserves in order that we may not have to bear motives in joining were to contribute our share the interest charge of 6 per cent on all defi- to its resources and to associate ourselves with ciency in required reserve forces us to incur the other leading banks of the country in deadditional loss. veloping the system, and I therefore suggest that I believe you will find it to your interest [No. 27. American Trust & Savings Bank, Birmingham, and advantage to become a member of the Ala.] system, so that you will be in a position to render service not excelled by any other insti- Our institution applied last July, and was tution, be it a State bank or national bank. admitted as a member of the Federal Eeserve System, we retaining our State charter. [No. 28. Old Colony Trust Co., Boston, Mass.] In answer to your questions as follows: 1. Our board of directors considered the sub- 1. We joined the Federal Reserve System on ject for six months before definitely applying account of the rediscount privilege, the adverfor membership. They were of the opinion tising, and the general desire to help along a that it would be better for the general business plan which seemed essential to the safety of interests of the country for all institutions to our country's financial stability. join the system, thereby insuring the successful 2. The only advantage we have so far gained operation of the great advantages to our busi- is the fact that our acceptances sell at a better ness interests and insuring the absence in the rate than those of the other trust companies of future of financial panics. the United States who are not members. This 2. As far as I can see the only advantage we means quite a little financial advantage. We have received to-day in being a member of the also have the contingent advantage of being system is that it has been a good advertisement able to lend more freely and not pay quite so for us, and possibly has brought business to us much attention to secondary reserve, relying that would not have come to us should we have somewhat upon the ability to rediscount, of only remained as a State banking institution which we have not yet availed ourself, preferwithout the membership in the Federal system. ring to sell acceptances in the open market. 3. The only disadvantage is that we are 3. We have found absolutely no disadvanlosing interest on the necessary balances we are tage from our membership, except the slight carrying with the Federal Reserve Bank in work involved in furnishing the Comptroller of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1.1917. FEDERAL RESERVE BULLETIN. 371 the Currency with five reports annually. These [First Guaranty State Bank, Pittsburg, Tex.] reports, however, are practically duplicates of the reports furnished to our State, and in Mas- The fundamental reasons which impelled us sachusetts the Federal Reserve Board have to join the system were chat we felt that to agreed with us that our State examination will belong to the reserve system would give us be sufficient for their purposes. additional strength, and that in stringent times 4. Our charter power is curtailed by joining we would be able to rediscount our paper at a to the extent that our lending capacity was re- low rate of discount. duced from 20 per cent to 10 per cent of our We have found no advantages whatever capital and surplus. Confidentially, we wel- from membership in the system. comed this. The disadvantages we have found from our 5. Membership gives us power to invest in membership in it have been a considerable foreign securities, which is not given to our increase in clerical work and. a great deal of State banks, and it makes a much better mar- unnecessary red tape. ket for our acceptances. Our charter powers have not been hampered 6. No. by our membership. 7. We are using the Federal Reserve Bank to Our membership gave us no new powers a considerable extent for collections; but this is which our charter or State laws did not confer because the Boston Clearing House Association upon us before. In fact, it really curtailed our voluntarily turned over to the Federal Reserve powers as far as handling land paper and loan Bank its New England clearing system. limit is concerned. 8. We find many advantages from belonging, The regulations of the Federal Reserve Board including that of much greater safety, and find have not interfered with our business or no disadvantages worth mentioning. From methods of doing business. your point of view, of course, we can not advise, The Federal Reserve Bank collection system as no doubt you have many local reasons for has affected us by reducing our net profits joining or not joining. Of "course, you under- about $500 per annum. stand we have the privilege of withdrawal upon Our general views on the advisability of a year's notice, and the Federal Reserve Bank joining the system are that) while we regard is obligated to buy back our stock. the system very highly, we candidly think that a bank desiring to go into the system should [Bank No. 29.] take the whole deal and take out a charter Our reason for joining the system was for under the national banking laws. protection in case of panic. Feeling that we derived no direct benefits We have felt no advantages from our mem- from our membership in the reserve system bership, as we have had no occasion to use it, and the compliance with the regulations creatand we feel that we have lost nothing. ing quite an increase in our clerical work, we The disadvantage we have found from our withdrew from, the system on January 18, 1917. membership was the making of extra reports. The Federal Reserve System is th.3 greatest We have not found our charter powers in any piece of legislation enacted in recent years way hampered or curtailed by our member- and it is entitled to our hearty support, but ship. it is an unnecessary expense and trouble We have found that membership, according to try and belong to both systems at the to national charter, gives us new powers. same time. The regulations of the Federal Reserve Board (Citizens State Bank, Memphis, Tex.] have not interfered with our business or our methods of doing business. The advantage we have found from our Wo have not been affected in any way by membership in the Federal Reserve System the Federal Reserve Bank collection system. is our ability to use our rediscount privileges We think that the Federal Reserve Bank more fully. collection system is a safe protection and con- The disadvantage we have found from our centration of funds. membership in the Federal Reserve System We think you have the proper view of the is that the loan limit to individuals or firms whole matter in a nutshell. .is reduced. 93720—17 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

372 FEDERAL RESERVE BULLETIN. MAY A, j917. We have found that membership gives us Press Statements. no new powers which our charter or State laws did not confer upon us before. These statements to the press have been The regulations of the Federal Reserve Board issued by the Comptroller of the Currency on have not interfered with our business nor our the dates given: methods of doing business. The reports of condition of the national The Federal Reserve Bank collection system banks of the United States just compiled show has caused us loss of exchange. that, on the date of the last call, March 5, 1917, Our general views on the advisability of the reserves of these banks amounted to 2,642 joining are that if in country where rediscount million dollars, exceeding by 169 million dollars privileges were not needed freely, we would the greatest reserves ever previously held. not join. Tne excess or surplus reserve held by the We are in a country where there is great banks, beyond the amount they are required by demand and we can get better rate from Federal law to hold, amounted to 1,109 million dollars, Reserve than corresponding banks. This is being 92 million dollars more than ever before, new developing country and requires plenty the largest surplus reserve previously held havof the cheapest money obtainable*. ing been shown on November 17, "l916, and amounted at that time to 1,017 million dollars. The total resources of the national ban s March 5, 1917, amounted to 15,979. million [Bank No. 32.] dollars, and exceeding by 645 million dollars I have noted very carefully your most wel- the assets held at tfi.e time of the last call come letter of recent date, in which you ask December 27, 1916, and were 2,140 million us to furnish you with an expression as to the dollars more than the resources of the banks in reasons for joining and the advantages and March a year ago. benefits we derive from the Federal Reserve The total deposits March 5, 1917, aggregated System. 12,957 million dollars, exceeding by 469 million "The following are the answers to the ques- dbllars the greatest deposits ever previously tions in your letter: reached and were an increase of 692 million 1. We did not think that we were getting dollars over the deposits of December 27, 1916, the right kind of treatment from the large city and an increase of 2,166 million dollars over banks which have been supplying us small in- the deposits of March 7 1916. Of this 692 7 stitutions with funds, in their rate of interests million dollars increase, 271 millions were in and time. individual deposits and 421 millions in deposits 2. Since we have been admitted we have from other banks. had the finest kind of services offered us by Loans and discounts March 5, 1917, were these same city banks. 8,712 million dollars, an increase since Decem- 3. None whatever. ber 27 last of 372 millions, and were 1,222 4. Positively no. million dollars more than on March 7, 1916. 5. We are offered great advantages through The amount of loans made by national banks the Federal Reserve banks and their member March 5, 1917, directly secured by warehouse banks, by helps through hard seasons. receipts for cotton was 92 million dollars. This 6. No." compared with 44 million dollars June 30, 1916, 7. Very satisfactory. and 48 million dollars September 12,1916. The 8. Our advice would be for banks and bank- records of the comptroller's office do not show ers to join hands, as we think that there are no the total amount of loans made by national better means to success than standing to- banks on warehouse receipts for cotton for intergether and unity. We now believe this much mediate dates between September 12,1916, and of the Federal Reserve System: Banks who are March 5, 1917, and the above figures are exnot members are to banks who are members as clusive of other loans made by national banks the fiber is to the cable—one tiny fiber is very on cotton but not secured directly by warehouse weak, while when united with many others— receipts. that is, under the system of many others—-mak- Specie, specie certificates, and balance on i ag one in unity and power, one under one hand with Federal Reserve Banks March 5, Head. 1917, amounted to 1,456 million dollars, being Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1. 1917. FEDERAL RESERVE BULLETIN. 373 an increase since December 27, 1916, of 72 | The States whose country banks showed the million dollars, and an increase as compared :largest percentage of reserves were Colorado, with March 7, 1916, of 316 million dollars. ;41.01 per cent; Nebraska, 40.67 per cent; Borrowed money as represented by bills Montana, 39.35 per cent; Kansas, 39.30 per payable and rediscounts March 5, 1917, was ;cent; Iowa, 36.76 per cent; Louisiana, 36.54 only 69 million dollars, a reduction as com- ;per cent; Kentucky, 36.49 per cent; Oregon, jjared with December 27, 1916, of 20 million :35.50 per cent; and Texas, 35.49 per cent. Hollars and an increase, as compared with Among the reserve cities, those whose banks March 7, a year ago, of 7 million dollars. held the largest percentage of reserve were United States bonds owned amounted to 714 ;Galveston, 47.47 per cent; Des Moines, 34.43 million dollars March 5, 1917, a reduction as per cent; Louisville and Tacoma each, 33.51 compared with December 27 last of 2 million per cent; San Antonio, 33.15 per cent; Housdollars and a decline of 39 million dollars as ton, 31.71 per cent; Dubuque, 31.68 per cent; compared with March 7, 1916, Birmingham, 30,93 per cent; Seattle, 30.23 Bonds other than united States bonds March '! per cent: Cincinnati, 30.14 per cent; Waco, 5, 1917, amounted to 1,770 millions dollars, an i; 30.01 per cent. The reserve cities outside of increase of 44 million dollars over December 27, the central reserve cities which showed the 1916, and an increase of 305 million dollars as lowest percentage of reserves were Charleston, compared with March 7, a year ago. 17.75 per cent; Minneapolis, 18.33 per cent; The amount due from banks other than Fed-.! Richmond and Atlanta each, 19.47 per cent; era! Reserve Banks was 2,016 million dollars .; and Muskogee, 19.18 per cent. The central March 5, 1917, an increase of 172 million dollars ''.. reserve cities showed: New York, 22.03 per as compared with December 27, 1916, and an ,• cent; Chicago, 18.73 per cent; and St. Louis, increase of 221 million dollars as compared with ;; 19.72 per cent. March 7, 1916. The States whose country banks showed the APRIL 7, 1917. lowest percentage of reserves were Rhode Island, 20.57 per cent; South Carolina, 20.94 The Comptroller of the Currency gave out per cent; Massachusetts, 20.99 per cent; New to-day the following statement concerning the ; ; York, 21.01 per cent. location of the reserves and surplus reserves :; The total amount of reserve held in the vaults held by national banks March 5, 1917: I: of the national banks or with their Federal Of the 2,642 million dollars of reserves held; Reserve Banks amounted to 1,564 million dolby national banks March 5, 1917, the banks in i lars. The reserve held with approved reserve the central reserve cities held 647 million dol- : agents was 1,078 million. As the total relars, or 100 million more than the amount re- \ serve required was only 1,533 million dollars, quired by law. Other reserve cities held 750 : it is seen that the banks now hold in their own million dollars, or 290 million more than was : vaults and in the Federal Reserve Banks in the required, while country banks held 1,245 mil- ! aggregate an amount greater than the total lion, being 718 million more than necessary. ; reserves which they are required to hold, so The percentage of reserve to deposits held i that the total of 1,078 million dollars held with by central reserve city banks was 21.31, I the reserve agents, plus 31 million of the cash against the requirement of 18 per cent. Other in vaults may all be regarded as excess or surreserve cities held 24.48 per cent, against a re- plus reserve. quirement of 15 per cent, while the country Under these conditions it is evident that no banks which were only required to hold 12 per inconvenience or hardship would result if the cent, held 28.36 per centof their deposits in amendment recommended by the Federal Rereserve. serve Board and the comptroller's office look- Among the country banks the heaviest re- ing to the anticipation of the time when the serves were shown in the Western States, entire reserves must be kept in their own where the average reserve held was 35.10 per I vaults or with the reserve banks should be cent. The Southern States held 30.57 per ; passed by Congress. The law as it now stands cent, Pacific States 30.32 per cent, Middle : permits country banks until November, 1917, States 29.89 per cent, Eastern States 24.11 ! to carry a portion of their reserves with the per cent, and the New England States 22.63 i central reserve and reserve cities. per cent. : APRIL 11, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

374 FEDERAL RESERVE BULLETIN. MAY :l, 1917. New National Bank Charters. of the Comptroller of the Currency, to the credit of the Treasurer of the United States, The Comptroller of the Currency reports the the amount of the bill. following increases and reductions in the num- The Federal Reserve Board is desirous of ber of national banks and the capital of cooperating with the Comptroller in this matter, and has instructed me to advise Federal national banks during the period from March Reserve Banks that they should receive these 24, 1917, to April 20, 1917, inclusive: deposits as they are tendered, and issue one certificate of deposit, in triplicate, covering all Banks. deposits on account of examinations, made by New charters issued to 15 national banks in each district for that day, With capital of 1635, 000 the certificate to contain an itemized list of the Increase of capital approved for 17 deposits made by each national bank. One With new capital of 4, 790,000 copy of the certificate should be forwarded each day, as deposits are made, by the Federal Aggregate number of new charters and Reserve Bank to the office of the Comptroller * banks increasing capital 32 of the Currency, another to the Treasurer of With aggregate of new capital, authorized 5, 425,000 the United States, and the third to the Secretary of the Treasury. Number of banks liquidating (other than those consolidating with other national banks) 4 Capital of same banks 200,000 Commercial Failures. Number of banks reducing capital 2 Reduction of capital 175,000 Commercial failures in the United States as reported by R. G. Dun & Co. continue to make Total number of banks going into liquida- a favorable comparison with the corresponding tion or reducing capital (other than those period last year. For the three weeks of April consolidating with other national banks). the number was 760, as compared with 1,046 Aggregate capital reduction 375, 000 for the three vvreeks of April in 1916. For the The foregoing statement shows the aggregate of month of March, the latest period for which increased capital for the period of the banks complete returns are available, the number is embraced in statement was 5,425,000 1,232, compared with 1,690 in March, 1916. Against this there was a reduction of capital Owing to more numerous suspensions in March owing to liquidations (other than for consolidation with other national banks) and of exceptional magnitude, the amount of liareductions of capital of 375,000 bilities—$17,406,096— shows a moderate gain over the $16,885,295, occurring during the Net increase 5, 050,000 corresponding month in 1916. As regards In addition to the changes noted above, ono bank, with number, there is a substantial decrease as cona capital of $25,000, was placed in the hands of a receiver trasted with every year back to 1913, when during this period. there were 1,190 insolvencies, while the liabilities were smaller than in any March since National-Bank Examinations. 1910. Separating these failures into Federal The following letter, regarding payment for reserve districts shows that aside from the national-bank examinations, was sent to Fed- ninth and eleventh, where the numbers ineral Reserve Banks and agents on April 26: creased 4 and 10, respectively, there was marked The Comptroller of the Currency has in- contraction in almost every district, with structed all national-bank examiners to leave especial improvement in the first, where there with each national bank upon the completion were 60 less defaults; the second, 143; the third, of its examination, a bill covering its assess- 49; the eighth, 41; and the twelfth, 74, as comment for the examination, with instructions that the national banks deposit with the Fed- pared with the same month a year ago. On eral Reserve Bank of their district, in the name the other hand, there were five districts show- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1, 1917. FEDERAL RESERVE BULLETIN. 375 ing gains in liabilities, the first approximately living. The Swiss Bankverein, in its " Finan- $603,000; the second, $2,039,000; the fourth, cial and Commercial Review for 1916," which $451,000; the fifth, $26,000; and the seventh, is even more interesting than usual, with its sur- $752,000. The most favorable exhibit in re- vey of war conditions, gives a table setting spect to liabilities was made by the sixth dis- forth as follows the increase in the gold holdings trict, with a falling off of $877,000, though very and paper circulations of the chief warring favorable comparisons were also made by the powers between the end of June, 1914, and the third, with a decrease of $656,000; the tenth, end of December, 1916: $503,000; the eleventh, $493,000; and the twelfth, $489,000. The figures for two years are compared below: Gold. Per Month of Marcli. cent. ! Great Britain 42,719 106.6 160,036 544. G ; Number. Liabilities. ! France 40,730 25.1 425,107 175.6 Districts. ! ! I R ta u l s y sia i 1 1 8 2 4 , , 8 6 9 7 7 8 i 1 2 04 6 . . 0 3 6 9 9 0 5 , , 1 83 1 4 2 4 1 2 4 6 4 . . 0 6 '•• 1917 | 1916 1917 , 1910 i Japan 11,006 53.0 16,278 49.7 : Germany 60,716 93.0 432,404 ! 359.3 ! Austria-Hungary.. 183,119 ' 189.0 First 102 162 $1,729,943 81,126,319 Second. 175 318 5,801,781 3,762,231 Total.. 327,552 j 57.6 2,002,890 268.0 Third 54 103 398,014 ! 1,054,934 F Fi o f u th rth • 9 9 3 8 1 11 2 3 6 1,3 9 0 1 7 6 , , 3 2 9 9 0 9 : : 8 8 5 9 6 0 , , 8 3 2 9 9 9 1 Decrease. Sixth 138 167 1,315,107 2,192,100 Seventh 194 195 2,009,431 . 1.857,144 It should bo noted that the figures given for Eighth 80 121 462,190 ' 738,291 Ninth 56 52 430,678 476,213 Great Britain include the gold held and the Tenth 42 69 392,014 905,785 Eleventh 80 70 310,418 803,714 paper issued under our new system of currency Twelfth 120 194 3,732,831 2,221,336 notes. According to this table, we hold a posi- I; nited States 11,,223322 1,690 17,406,096 16,885,295 tion of eminence as having worked the printing press relatively harder than any other bellige- Fiduciary Powers. rent. We think that this comparison does us The application of the following bank for an injustice, because in our case a large part permission to act under section 11 (k) of the of the paper issued has taken the place of gold Federal Reserve Act has been approved since that was in circulation or held by the banks the issue of the April Bulletin: other than the Bank of England. In the old days most people with an income at or above DISTRICT NO. 2. a certain level carried a few sovereigns in their Registrar of stocks and bonds: pockets. Now they carry paper. So that the Atlantic National Bank, New York, N. Y. actual net increase of currency by note issue has been, we believe, relatively less in our case The Progress of Inflation.1 than this table implies. Nevertheless, when all allowance is made for this consideration, We have frequently called attention to the the fact remains that the Government has by extent of the inflation that has been produced its note issue increased considerably the amount in this country and all over the world by the of legal tender available. multiplication, during the course of the war, of But besides the note issue our banking delegal-tender paper money and banking credits, velopment gives us other means. We can also and the effect of this inflation in helping to inproduce currency, in the shape of the right to crease the rise in. prices which is adding so enordraw a check by banking book entries. The mously to the cost of the war and to the cost of Bank of England's note issue, which has only risen pan passu with its holding of gold. -i* 1 From the London Economist, Mar. 10,1917, p. 464. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

378 FEDERAL RESERVE BULLETIN. MAY .3, 1917. included in the above figures; but its banking up, and that the pound sterling should bo dedepartment has also been busy. In the same preciated when measured in the currencies of period—end June, 1914, to end December, foreign countries. As we all know, prices have 1916—we find that this department's figures risen enormously, and all the neutral exchanges have altered as follows: are strongly against us. It is surely safe to suspect that our currency policy has had July l 1914. y | something to do with both these unfavorable Capital and rest £17, 810,000 Deposits 71,622,000 results. One does not usually improve the Securities 60, 698,000 value of a thing by multiplying its volume, and Reserve 28, 748,000 when we see the value of the pound lower, | whether measured by its buying power over Dec. 27, 1916. Capital and rest 17, 863,000 commodities or by its exchange value, its Deposits 178,843,000 multiplication surely becomes questionable. Securities 163, 649,000 Mr. Robert Benson traversed this argument in Reserve... 33,079,000 the course of his interesting speech at the Mer- Here we see a round 100 millions added to chants7 Trust meeting on March 2. He the Bank of England's holding of securities thinks that "the effect upon prices of variations and a consequent increase of 100 millions in the in the supply of credit lias become more and " deposits," book entries which can either be more negligible/7 and he quoted as an answer drawn against by the Government or considered to the theory that an increase in the supply as "cash" by the other banks. of money or credit raises the price of goods, a The other British banks have also "done saying by a professor of political economy at their bit," though on a relatively modest scale. Oxford, that "goods and services are not By subscribing in the first two war loans and really exchanged for pounds sterling, but for other Government securities they have in- other goods and services/7 This is quite true creased their holding of investments by over in most cases, but money is still the measure 230 millions between the end of 1913 and the in each exchange, and a multiplication of the end of 1916, while, thanks to the flood of new measuring units has an unfortunate effect on cash created for them by the Bank of England those whose incomes for one reason or another and the Government, their cash on hand, at has not kept pace with the increase in their call, and at short notice has risen by over 130 volume. millions in the same period. On the other side It also has a most unfortunate effect on the of the account their deposits, representing finances of the Government which borrows potential currency in the hands of their cus- money and spends it at a time when it is decustomers, rose by over 330 millions. We preciated, and will pay interest on it and repay take these figures, which are partly estimated, it in time to come, when we hope that its buying from Mr. Drummond Fraser's interesting pam- power will have achieved some recovery. This phlet on "Finance after the War" (Herald and being so, we can not agree with Mr. Benson's Walker, Manchester). We shall not be sur- evident regret concerning the failure of a proprised if, when the complete figures are shown posal that the trust companies should subscribe in our Banking Number that will appear (if for 100,000,000 of war loans, borrowing we have enough paper) in May, the increase in 80,000,000 from the banks. There could have the bank deposits is shown to be even greater. been no question of their paying the banks off Here, then, is an enormous mass of new cur- out of any savings of their own; and the operrency, in the form of legal tender and banking ation would have simply resulted in a further credit, that has been created at a time when it increase in inflation. We can not find goods is most undesirable that prices should be forced and services needed for the war by manufac- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY l. 11)17. FEDERAL RESERVE BULLETIN. 377 turing credits, but only by saving, and so cause of the rise in prices ? It is also desirable going without goods and services, which are that the manufacture of credit by the Bank of thereby placed at the disposal of the Govern- England should be set in motion as little as ment. Hence it is that every one who has possible, and that its bloated holding of securiborrowed from his bank to take up war loan ties should be gradually reduced. If the war will have done his country no real good until is to be soundly financed, the Government he has saved the sum borrowed and paid off his should aim at getting money out of the pockets advance from his bank. of the citizens before it spends it, instead of But inflation is always attractive; it seems so taking the easy line of using banking credits, simple to pay for things by just manufacturing and so putting up prices against itself and more money. Hence we hear of various everybody else. schemes afloat for issues of interest-bearing These measures, if adopted, with the gradual certificates that could also be used as currency. caution that all economic changes require, We sincerely hope that such schemes will be need produce no return of stringency. In pitched straight into the wastepaper basket. fact, as we have frequently urged, such strin- What we want is not more currency, but less. gency as has been artificially created by special What we want more of is work and stuff. measures was only necessitated because no We believe that inflation has already done attempt was made to divorce the prices of much harm by raising discontent in the country home and foreign money. Since the desirabiland increasing the cost of the war, owing to ity of this change is now being much discussed, the rise in prices that it has helped to cause and it is perhaps opportune to point out that to pay that everything should be done to check it. one rate to neutrals and another to home We can not see why the issue of Treasury notes lenders, is a thing that can only be done in time should be allowed to grow without limit. It of war, when exceptional knowledge of monewas created to meet a banking emergency, and tary movements is in the hands of the Governwas to be taken out in the form of a loan by the ment, or those who represent it in the city, that banks. Now it is handed out, apparently, ad it would, if started earlier, have saved us many libitum to any bank which pays for it out of its millions a year in our after-war debt charge; balance at the Bank of England. It is time but that it would not, of course, be desirable that the system was overhauled and modified. to leave the price of home money unregulated The volume of notes outstanding has decreased and uncontrolled, or to allow its lowering to be lately, probably owing to war-loan payments, made the basis of speculation in securities. and we see no reason why it should be allowed If it gave cheaper money to the Government to swell again. It is sometimes maintained for the war, and to the exporter and the grower that higher prices demand a continuing increase in the supply of currency; but what if and producer of necessaries, it would be a the increase in the supply of currency is the highly beneficent measure. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

378 FEDERAL RESERVE BULLETIN. MAY 1, 1917. INFORMAL RULINGS OF THE BOARD. Below are reproduced letters sent out from proved for several manufacturing concerns and time to time over the signatures of the officers which may be of interest to you in adopting a form for general use in your district. or members of the Federal Reserve Board APRIL 19, 1917. which contain information believed to be of general interest to Federal Reserve Banks and [Enclosure.] member banks of the system: X. Y. Z. Co. No BlNGHAMTON, N. Y., ,191 Paper for Rediscount. [To an individual.] Your letter of April 12, addressed to the Sec- after date pay to the order of ourselves retary of the Treasury, has been referred to the Dollars in settlement of the purchase oi' Federal Reserve Board for consideration. goods as billed in our invoice No dated Section 13 of the Federal Reserve Act pro- Goods received. vides that a bill, in order to be eligible for redis- X.Y.Z.CO. By count by a Federal Reserve Bank, must have I To Cashier. a maturity at the time of discount of not more than 90 days. The Federal Reserve Board has, therefore, ruled that a demand note or bill is Acceptances. not eligible under the provisions of the act, (To a Federal Reserve Bank.) since it is not in terms payable within the pre- | Your letter of March 20, submitting an scribed 90 days, but, at the option of the inquiry of one of your member banks as to holder, may not be presented for payment until whether or not it could accept clean drafts after that time. The trade acceptance sub-1 drawn by an exporter in Chile for the purpose mitted by you would very probably be con-! of providing funds with which to purchase strued by the courts to be a demand bill, since j beans, peas, etc., from farmers in Chile, has no definite maturity is fixed. It merely states j been received and considered. that '-in the ordinary course of business pre- In reply you are advised that unless the sentment will.be made 60 days from date," Chilean exporter is under contract to ship the but the holder is not required to present it peas, beans, etc., purchased from the farmers within that time. in that country, to some other country, and the If the bill were altered so as to read "on or member bank has a guarantee to this effect, the before 60 days from date pay to the order of transaction would not seem to be one which ourselves," etc., it would come within the involves the importation or exportation^ of terms of the law and would be eligible for redisgoods. count. In such case the holder would have the The mere fact that the Chilean exporter inright to present it for payment before the expitends to sell these goods in a foreign country ration of 60 days, but could not defer presentwould not be sufficient, but there must exist ment until after that time without releasing some actual contract of sale, and it must appear the indorsers. that the drafts in question are merely drawn in There may be some doubt about the corrcetadvance of the actual shipment of goods under, ness of the statement in your form that the contract of sale. obligation of the acceptor arises out of the pur- | chase of goods if it is intended to have that MARCH 24, 1917. acceptance cover future purchases. It is not clear from your letter whether this is intended. Cattle Paper. The bill, in order to be a trade acceptance, (To a member of Congress.) must arise out of the purchase of goods, and I have your letter of the 3d instant, and unless that purchase is either consummated or would state that in two of the Federal Keserve actually contracted for at the time the bill is districts—Kansas City and Dallas—a considdrawn it is doubtful whether you can properly erable business is being done in loans to farmers say that the obligation arises out of the pur- running six months, secured by chattel mortchase of goods. gages on cattle. Under the Federal Reserve I am inclosing for your information a form of Act, a loan made by a member bank in good acceptance which the board has already ap- faith to a farmer, for the purpose of assisting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL RESERVE BULLETIN. 379 him to produce a crop, or to fatten his cattle, opinion received by me to-day from counsel, would be eligible for discount by a Federal Re- which is self-explanatory. serve Bank whether secured by a mortgage or (Inclosure.) not, but most of the farmers' notes which have In the attached letter the managing director been discounted with Federal Reserve Banks of the New Orleans branch of the Federal for member banks are secured by chattel Reserve Bank of Atlanta has asked whether mortgages. the funds of the farm loan bank about to be In Texas, Oklahoma, and Kansas this established at New Orleans will be deposited business is done on a large scale, and is thorwith the New Orleans branch of the Federal oughly understood, and 1 would suggest that Reserve Bank of Atlanta. if any banks in your district are interested in Federal Reserve Banks are not authorized extending credits of this kind, it might be well by the Federal Reserve Act to receive deposits for them to correspond with the Federal Reexcept from the United States Government and serve Bank at Kansas City, or the Federal from member banks, and I find no provision in Reserve Bank at Dallas, for information as to the farm loan act authorizing farm loan banks details. The Board is informed that many of to make deposits in Federal Reserve Banks. the member banks in the three States named The only provision on this subject appears to regard cattle paper properly secured as being be in subsection 5 of section 13 of the farm loan as desirable an investment as they can make, act. Section 13 defines the powers of Federal and the Federal Reserve Banks do not hesitate land banks, and among these is that contained to rediscount such paper freely for them. in section 5 which reads "to deposit its APRIL 4, 1917. securities and its current funds . subject to check with any member bank of the Federal Reserve System and receive interest on the Place of Payment of Acceptance. same as may be agreed.77 Under the circum- (To a Federal Reserve Bank.) stances, I am of the opinion that it would In reply to yours of April 9, I am inrequire a somewhat forced construction of the closing copy of the Federal Reserve Bulletin act to reach the conclusion that farm loan for April, 1917, on pages 289-290 of which you banks may deposit their funds with Federal will find an opinion of counsel, approved by Reserve Banks. the Board, which deals with the subject under APRIL 6, 1917. consideration. You ask whether a bank in accepting a draft Paper of Equity Exchange. of its customer may make it payable eisewnere than at its banking house. (To an individual.) Under the opinion referred to it would The letter addressed to you by Mr. , seem that the drawer of the draft might make and forwarded by you to the Federal Reserve it payable either at the bank against which it Board, has been duly considered, and I am is drawn or at some other place, and, when directed to. inform you that paper of these accepted, it would be payable according to its equity exchanges, to which the writer refers, terms, namely, either at the banking house of if first discounted by a member bank would the drawee or at the other designated place. be in form eligible for rediscount at the Federal If the terms of the original draft make it Reserve Bank, provided its maturity at the payable at the banking house of the drawee time of discount does not exceed 90 days. the drawee may nevertheless accept it payable Furthermore, if the loan were made by the elsewhere—as, for example, at a Federal Re- member bank at 6 per cent or less such paper serve Bank—provided the acceptance does not could be rediscounted with the Federal Reserve stipulate in terms that it is payable only at the Bank as commodity paper, provided that it is Federal Reserve Bank and not eisewnere. properly secured. The writer seems to be under the impression APRIL 11, 1917. that these equity exchanges can deal directly with their Federal Reserve Bank, but under the Farm Loan Bank Deposits. Federal Reserve Act their paper must first (To a Federal Reserve Bank.) have been discounted with a member bank and Referring to your letter of the 19th ultimo, the member bank alone would have the right with reference to the deposit of funds of the to rediscount this paper with the Federal New Orleans Farm Loan Bank with your Reserve Bank. institution, 1 hand you herewith copy of an MARCH 7. 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

380 FEDERAL RESERVE BULLETIN. MAI* 1, 1917. LAW DEPARTMENT. The following opinion of counsel has been Where the purchaser of goods draws upon authorized for publication by the Board since his own bank and offers a bill of lading as sethe last edition of the Bulletin: curity for the draft, he may or may not use the proceeds derived from the draft to pay for Domestic Bankers' Acceptances. the goods bought. The bank, in that case, A draft drawn by the purchaser of goods against a nacould not assume that there was any obligational bank is not eligible for acceptance by that bank under the provisions of section 13 of the Federal Reserve tion on the part of the buyer to use such funds Act merely because it is secured by a bill of lading cover- to liquidate the debt contracted in the puring the goods bought. chase of the goods. The transaction, in substance, is merely a straight loan to the drawer APRIL 21, 1917. SIB: The following case has been submitted secured by a bill of lading, and as such it to this office for an opinion: The seller ships would not seem to come within the spirit of goods which have been sold and mails the bill the provisions of section 13 authorizing naof lading to the purchaser. On arrival of the tional banks to accept drafts which grow out bill of lading the purchaser draws on his own of the domestic shipment of goods. bank, attaching the bill of lading to the draft Congress evidently intended to prevent the as security and offers it for acceptance. May possibility of abuse of the domestic acceptance the bank execute such an acceptance ? privilege by requiring not merely that the Section 13 of the Federal Reserve Act, as draft should grow out of a transaction involvamended by the Act of September 7, 1916, au- ing the domestic shipment of goods, but also thorizes any member bank to accept drafts or that the bill of lading should be attached. It bills of exchange "which grow out of transac- could not have been contemplated that this tions involving the domestic shipment of goods, privilege should be construed to permit anyprovided shipping documents conveying or se- one possessing a bill of lading to borrow on its curing title are attached at the time of accept- security regardless of the use to which the proance." ceeds of the draft might be put. Ordinarily The question presented for determination the seller in a domestic transaction draws therefore, is whether the sole fact that the bill either on the purchaser or on the purchaser's of lading is the collateral security for the draft bank. In either case the seller is assured of presented for acceptance is sufficient to make the proceeds of the draft, but it could not have the transaction comply with the requirement been intended by the Act that the purchaser y that the draft must grow out of a transaction on receipt of a bill of lading, should be able to involving a shipment of goods. use that bill as the basis of a domestic bank- It is evident that this provision of the law er's acceptance to obtain a credit for any purcontemplated some actual connection between pose he may see fit to use it, the acceptance of the draft and the transaction Respectfully, involving the sale and shipment of the goods— M. C. ELLIOTT, Counsel. that is, it was evidently intended that the draft To Hon. W. P. G. HARDING, should be drawn to finance that transaction. Governor Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917, FEDEBAI. EESERVE BULLETIN. 381 SUMMARY OF BUSINESS CONDITIONS APR. 23, 1917. District No. I- District No. 2— District No. 3— District No. 4— District No. f>- District No. 6— Boston. New York. Philadelphia. Cleveland. Richmond. Atlanta. General business Good j Active; rising Very good ; Active and pros- i Some irregularity, j Extremely good. prices creating I perous. , but holding up j increased vol- : j well. i ume. Crops: Condition Backward Fair I Much improved...] Rather backward.j Work behind. Outlook Larger areas being Hopeful Fair —! Promising ! Full planting; | Limited planting. planted. i I fruit reported j ! draiammcatfgxenrdl. Industries of the dis- ; ".Busy.. A c t i vc; com- Very busy Running to capa- Active; labor Working full; labor trict. i plaints of scar- city, with labor I demand. shortage. city and high shortage. cost of labor and materials. Construction, build- Slight; doorcase Smaller than last Decrease i Satisfactory; in- Good volume Limited. ing and engineering. from last year. year. I j creases in home | ! construction. Foreign trade Increased over Imports active; 50; Heavy decrease in Con g c s t i o n at Small. last year. per cent over : exports com- ports; but ex- February. ! pared to pre- ports in good viio us montthh. volume. Bank clearings Increase over last j Increase : Increasing Substantial in- Continue to show Increasing. year. Decrease crease. slight increase. from last month, i Money rates Strengthening | Steady Firmer; commcr- I Firm and tend- Continued de- Normal. cial paper rate i ency to increase. mand for crop increasing. } purposes. | Railroad, post office, Decreased, P. O. receipts, I Net earnings of | 'Slight increase Normal; railroad | Good, and other receipts. slight increase; i railroads de- j expenses show | R. K. receipts, < creasing; P. O. ; increase, with i marked in- , receipts increas- ! tendency to re-• |! crease. i ing. i duction of net. j I^abor conditions Fully employed... Labor scarce; ! Scarcity in many : Generally good Fully employed... Scarcity of labor. wages rising. j Sines. : Outlook For more normal Continuation of jGood ,; Satisfactory. On the whole, Decreased cotton conditions. present condi- i favorable. acreage; intions, with ris- ! creased f o o ding prices. ; s tuffs. Remarks. Business awaiting | No impediments j Some irregularity more definite in- except lack of owing to specific formation re- adequate labor conditions; gengarding war and and car short- erally satisfac- Government age. tory. needs. District No. 7— District No. 8— District No. 9— District No. 10— DistrictNo.il— ! District No. 12- Chicago. St. Louis. Minneapolis. Kansas City. Dallas. J San Francisco. General business.. Active Very active. Active ! Continues active.. Good j Active. Crops: Condition Winter wheat poor ! Improved | Generally good i Backward Outlook Other crops have Fair Good... I Oniyfair I j Fair. a favorable prospect. Industries of the dis- Volume of busi- Busy... Active. i Active and pros- Active and run- \ Active, trict. ness well main- perous. ning on full time.! tained. Construction, build- Retarded, due to Decrease in some Active. Increased volume. Building active j Slight decrease. ing and engineering. cost of construc- lines. and normal for ! tion. the season. ' Foreign trade... Limited.. Increase over a j Exports increase; year ago. imports decrease. Bank clearings. Increase over last Increase Increased. Substantial In- Show a 29 per cent Increase over last eai crease. increase. ; year. Money rates m. Commercial paper Steady ; Steady, *rtth indi- No change over 30 Steady. higher. Bank cations of days ago; easy. rates steady. strengthening. Railroad, post office, Increase over last Increase Increased Increased volume. Railroad good in- Increasing. and other receipts. year; decrease crease over 191G: from last month. post office, 15 per cent increase. Labor conditions Shortage of labor.. Fairly settled Fair to good.. Shortage apparent. Labor well em- Fairly settled; supployed; expor- ply deficient. tation of unskilled men to the North seriously felt here- Outlook.. Favorable but un- Favorable ; Very good., Satisfactory, ex- Bright Favorable. certain. cept for wheat crop. I Remarks. High prices are af- Rains are becom- Campaign for in- j Prospects for only fecting sales in ing general and creased food • —m-o-•d•-erate prosome lines, but crop prospects crops sure to be duction of food general business are much im- effective, and is stuffs this year. reports satisfac- proved. meeting an untory condition. selfish response on part of farmers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

382 FEDERAL RESERVE BULLETIN. MAY 1. 191T. GENERAL BUSINESS CONDITIONS. There is given on the preceding page a sum- factor in costs of production. That economy mary of business conditions in the United is being practiced is becoming more evident States by Federal Reserve districts. The re- each day, the increase in the cost of living, all ports are furnished by the Federal Reserve out of proportion to the average increase in Agents, who are the chairmen of the boards of wages, making such action necessary. directors for the Reserve Banks of the several There has been no sign of financial disturbdistricts. Below are the detailed reports as of ance of any kind in this district, but all the approximately April 23: banks are keeping their assets as liquid as possible as a precautionary measure and in an- DISTRICT NO. I—BOSTON. ticipation of the coming Government financing. The declaration of war and the uncertainty During the past month wool dealers in regarding the nature of the participation by Boston suspended business for about 10 days the United States and its effect on our domestic in order that the wool held by them might be life have pervaded the whole commercial and offered to the Government if needed. An financial atmosphere. While preparedness and inventory of the wool held by the trade as of safety committees have sprung up on every April 3 showed an estimated total of clean hand it seems probable that as the first shock wool of approximately 60,000,000 pounds. As of war wears off conditions will return to more the Government was unable to take advantage nearly normal. of the offer, trading was resumed and prices Meantime prices of commodities continue continued to advance, this in spite of the fact to rise and evidences of the hoarding of food that wool on hand as disclosed by the invensupplies are on every hand, many householders tory showed a considerably larger stock than stocking up with large amounts of flour, sugar, most dealers had estimated. The future course canned goods, etc. Reports in the press of a of wool prices is a matter of considerable coming food shortage have served to aggravate difference of opinion in the trade. The printhis situation. cipal arguments against extremely high prices Farmers are planting larger areas than ever are the possibility of the release of a large before, and even in the cities vacant land is amount of Australian wool by England or the being cultivated. It is yet too early to know making of an early peace. Woolen and anything definite regarding crop prospects in worsted mills continue busy, the sold-up conthis district. The steady cold of the winter, dition of the woolen mills being reflected in with no very severe temperatures, has probably the worsted situation. allowed most fruits to come through in fair The boot and shoe industry continues busy, condition. Pastures went into the winter with and some orders for Government shoes have a good growth for protection, and the late been booked. Production costs, however, are snows will probably help toward a good start. very high and a number of factories in Lynn There is a general shortage of seed which, taken have closed, stating that with the present in conjunction with the severe shortage of scarcity and high price of leather it was imfarm labor and with unsatisfactory fertilizer, possible to operate at a profit. Orders for tends to restrict the large increase in acreage men's shoes are not coming in as briskly as lastwhich the high prices of food would otherwise year, due to the fact that many retailers overcause. stocked at that time aijd that high prices are The shortage in coal and the rise in price of tending to restrict buying by the consumer. that commodity has become an important Orders for ladies7 shoes are coming in satisfac* Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 191.7. FEDERAL RESERVE BULLETIN. 383 torily. Style influences this business fco a large 048,842, as compared with $219,284,696 for the extent, and retailers only buy for their current corresponding week last year, and $277,025,268 needs, not stocking up in advance. Leather of for the week ending April 7, 1917. all kinds continues in good demand with prices Building and engineering operations in New high. Collections are reported to be good. England from January 1 to April 11, 1917, Cotton mills continue extremely busy -with amounted to $45,387,000, as compared with orders, in many cases booked through the sum- §46,892,000 for the corresponding period, of mer and in some mills even, until late iali. The 1916, the highest previous year recorded. high cost of production, especially the cost of Exports from the port of Boston for March, cotton, coal, and labor, is causing prices to 1917. amounted to $19,707,013, as compared advance, but, notwithstanding this fact, buyers with 822,390.613 for February, 1917." and are anxious to place orders. G-overnmoat $11,506,025 for March, 1916. agents are reported to be buying various cloths Imports amounted to $24,816,006, as comfor military purposes, such as low count goods pared with $21,743,471 for February, 1917, for bandages and marquisettes for mosquito and $21,451,229 for March, 1916. netting. A shortage of labor is looked for, due The receipts of the Boston post office for to war enlistments, and there is some anxiety March, 1917, show an increase of $48,431.79, oi.« the part of buyers as to the fate of their or about 6 per cent more than March, 1916. orders in case the mill machinery is Deeded for For the first 15 days of April, 1917, receipts Government work. wore about 2 per cent, or §8,581.92, less than The money market is considerably firmer for the corresponding period last year. than last month, especially for longer dates, Boston & Maine Railroad reports net operarid Boston banks are buying only a limited ating income, after taxes, for February, 1917, amount of outside paper and then only at at- as 5413,733, as compared with $1,044,122 for tractive rates. Most banks are not adverse to the corresponding month of 1916. New York, going as long of cash as possible at this time New Haven & Hartford Railroad reports net with the possibility of large demands from operating income, after taxes, for February, their customers in connection with Govern- 1917, as $1,009,015, as compared with $1,198,ment needs. Call money 3J to 4 per cent; 374 for the same month last year, time money 4J to 5 per cent for six months, 4f per cent upward for one year. Town notes, DISTRICT NO. 2—NEW YORK. 4 per cent upward for fall maturities. Bank- The outstanding developments resulting from ers' acceptances, 3 per cent upward. our entrance into the war have been the very Loans and discounts on April 14, 1917, keen interest on the part of banks and bankers, amounted to $463,184,000, as compared with particularly those in New York City, in the $465,298,000 last month, and $410,745,000 on prospective sale of Government bonds and April 15, 1916. Deposits on April 14, 1917, Treasury notes, determined efforts throughout totaled $364,406,000, as compared with $371,- the entire district to increase the food supply, 143,000 on March 17, 1917, and $340,159,000 and a speeding up of many branches of industry on April 15, 1916. The amount "Due to as a result of Government buying. In lines banks" on April 14 was $147,630,000, as com- which are not directly affected by war prepapared with 3146,369,000 on March 17. The rations conditions do not appear to have been excess reserve of these banks increased from greatly altered, although in some quarters a $40,293,000 on March 17 to 140,428,000 on feeling of conservatism is in evidence. Govern- April 14. ment purchases, which have received prece- Exchanges of the Boston Clearing House for dence over all others, have been at prices much the week ending April 14. 1917, were $227,- below those paid by other buyers, the action of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

384 FEDERAL RESERVE BULLETIN. MAY 1, 1917, copper producers in contracting to deliver cop- of 9 per cent in number of employees and 23 per below the market price having been fol- per cent in the aggregate of wages. Similar lowed by steel companies and food jobbers. comparison with March two years ago shows Banks and bankers are offering their serv- increases of 30 per cent and 62 per cent, ices without compensation in connection with respectively. subscriptions to the loan. Evidence of the Kailroad gross earnings show an increase of spirit of the New York banks and bankers was about 10 per cent over those of a year ago, but shown by tentative subscriptions of over increased expenses threaten serious impairment $100,000,000 to the first offering of Treasury of net earnings. notes due June 30. Much corporate financing Substantial improvement in manufacturing has been deferred to avoid interference with conditions in the iron and steel industry has the Government's issue. Security prices have come at an opportune time and the advent of been somewhat weakened by uncertainties as war finds the industry thoroughly prepared. to the new issues, and also by the possibility Better transportation facilities and a more that State and municipal bonds, hitherto tax normal supply of coke have resulted in a conexempt, may be subjected to Federal income siderable increase in pig-iron production. The tax. total, in March, amounted to 3,250,757 tons, Particular attention is being directed to the an increase of 605,510 tons over the previous production of an increased food supply, as the month's output. relatively small stocks of foodstuffs which are Coal production and deliveries have imreported from various sources and the unsatis- proved somewhat, but increased demands are factory condition of the winter wheat crop expected during the coming year with little make prompt and vigorous measures along this prospect of larger output. Manufacturers of line essential. In New York State plans fos- machinery report a volume of business in extered by State and city officials are going for- cess of that of a year ago and at satisfactory ward to organize corps of "farm cadets" to prices. There is an immense demand for assist in planting and to have city employees electrical machinery for industrial plants and spend their vacations doing farm work. The an unusually heavy demand for larger power development of home gardens is also receiving apparatus for the equipment of central staattention. tions furnishing electricity. The machine Prices continue to rise. Dun's index tool trade is very active. Reports indicate that number for wholesale commodity prices for business is being secured more uniformly April 1 was $190,012, which represents a from the entire country and the total is made net gain of 2 per cent over March 1 and con- up of a large number of satisfactory small trasts with $145,690 on April 1, 1916. The in- transactions with the regular consuming trade crease since the beginning of the war has been rather than special contracts as in past years. 57 per cent. The Annalist index number for In the rubber trade the demand for footwear the cost of living for the third week in April and tires has been very large and the volume was.270 as against 240 a month previous and of business in the mechanical rubber goods is 155 two years ago. from 20 per cent to 25 per cent over that of last From every side come reports of scarcity of year. labor and of increased wages. Wages paid Textile and clothing industries report busito workers in New York State industries in ness as steady and in some cases increasing March were 5 per cent greater than those paid in value of transactions. Shortage of labor in in February, the number of employees having eastern cotton mills has caused curtailment increased but 1 per cent, while as compared of production estimated at 10 per cent to 35 per with March of a year ago there was an increase cent, and cotton goods stocks in the hands of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL KESEBVE BULLETIN. 385 the mills are lower than at any time since the Foreign commerce has recovered from the beginning of the war. low point in February, the imports at New In the dry-goods trade the appeal for j York during March being $50,000,000 greater economy in dress is having an increasing in- j than those for February and almost $32,000,000 fluence on retail sales. Stocks on hand are j greater than those of a year ago, while exports low. An auction sale by a large rug and carpet ] were §34,500,000 greater than those for Februmanufacturing company in New York brought j ary. Particularly heavy increases appear in such, low bids that the company has announced | imports from countries of North and South it will reduce the output of its mills by one-half, j America. Dealings in hides are active at increasing ! The following statistics have been obtained prices. Orders from retailers for footwear are ! from reliable sources: slow, retailers reporting quiet trade due to efforts toward economy. ! The prices of stocks on the New York: Mardl»1917- C M h a a r n c g h e , s 1 f 9 r 1 o 6 m . Stock Exchange have declined during the ! Bank clearings, New York City 514,229,127,260 SI,681,252,750 month to about the level of two months ago New York Stock Exchange shares.. • 18,516,944 + 5,202,569 New York Stock Exchange bonds.. '• $73,297,000 - §3,998,000 and bond prices have fallen to the lowest point ', Pig-iron production tons.. • 3,260,757 86,934 i Unfilled orders, United States Steel since October, 1915. Bond sales from March I Corporation tons..; 11,711,644 4- 2,380,643 Building permits. New York City ; §12,353,422 - 81,302,650 25 to April 21 were $87,977,500 and stock I Postal receipts, New York City : S3,387,047 •f- $280,123 : Merchandise exports at New York : §258,020,108 +825,291,200 sales 18,736,413 shares, an increase of ! Merchandise imports at New York ! §147,901,883 +831,707,922 i New incorporations, Eastern States > 6281,000,000 +§86,250,000 $6,861,850 and 7,829,267 shares, respectively, : American railroads ana industrial ! over the same period a year ago. corporations ; $312,115,800 +337,468,000 Call and time money rates have been steady during April with a slight upward tendency. 3-PHILABELPHIA. Call rates on April 25 touched 4 per cent DISTEICT Na but closed at 24 per cent. Commercial paper T-™ ontranco of the ITnited States into the rates advanced from 4-44 on March 31 to war ]ias caused advances in prices, greater 4J-55 on Apprl il 25. demand for goods, and greater scarcity in Between March 17 and April 20 deposits of ; materials in many lines of trade. Manufactur- New York clearing house banks show increases | ing plants throughout this district are running of $7O OOO>OOO in net deposits, $110,000,000 in j as fully as the supply of labor and materials 7 loans, and a decrease of $25,000,000 in excess | will permit. The problem of deliveries in reserves, the amount of the excess on the | many cases has been very annoying because of latter date being $120,000,000. Fifteen banks the limitation of output and troublesome transwhich are members of the New York Clear- portation conditions. ing House Association and also of the Fed- The labor situation has become very acute. eral Reserve System have arranged with the It hampers not only the manufacturers, who are Federal Reserve Bank of New York to receive j under the necessity of turning out iron and or pay on their behalf the amount of their steel, ammunition, clothing, textiles, and other daily balances at the clearing house. There products in greater quantity than ever before, has been continued demand for large quantities j but it is also greatly retarding the basic inof paper currency in the district, and the Federal jdustries, such as agriculture and mining. Reserve Bank of New York increased its circu-! The condition of the winter-wheat crop, lation by $34,500,000 between March 21 and • according to local and Government reports, April 20, against which a similar amount of j is at least 15 per cent below normal. The gold has been lodged with the Federal Reserve season is late and spring plowing and planting agent. has been delayed. Farmers report less stock Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

386 FEDERAL RESERVE BULLETIN. MAY 1, 1917. on the farm than for many years, and all kinds tremely good, in some instances sales being the of feed except hay are scarce and high. largest of any March in their history, but since Reports show that there is a patriotic desire Easter, trade has fallen off very much, and on the part of the people in the agricultural there is a feeling that this is largely due to the sections to do their full duty toward producing practicing of economy on the part of the public, the maximum amount of foodstuffs and there which has been so earnestly recommended. Is evidence that they intend to make the effort, Groceries.—The wholesale grocery trade is but on account of the high price and scarcity having difficulty because of excess demand for of fertilizers, the high price of seed, and thegoods. Consumers have been anticipating scarcity and high wages of labor, it appears their needs hj making unusually large purthat the acreage planted to food crops can not chases. Wholesalers generally are adopting be materially increased. the policy of scaling orders in accordance with Some large coal companies are offering their the size of the retailer and his actual need. lands to their employees for cultivation, and There is said to be plenty of goods to go round are holding out inducements toward this end, if it were not for so much anticipation. and throughout the district generally the Metal industries,—The fundamental condiattempt is being made to have people put forth tions in these industries remain unchanged. extra efforts in planting vegetable gardens for The continued high price of coal is having a their own account. marked effect upon the cost of iron and steel Owing to enlistments, the transfer of labor production. The national situation is causing from the farming and suburban districts to many companies to refuse general orders, as the much more lucrative employment in muni- preference is being given to Government tion and other manufacturing plants, and the inquiries. action of local contractors in paying S3 and Money.—Rates for money in the active $3.25 per day for men, the farm labor shortage manufacturing districts are somewhat better; has become so acute that unless some national throughout the rest of the district the demand organized effort is made at once to provide for money is only normal. The imminent prosagricultural labor, it not only-will be impossible pect of large Government borrowings is causto increase the acreage under cultivation, but ing hesitation in the investment of funds. there is grave doubt whether or not it will be Sales of all kinds of securities have fallen off and possible to cultivate and harvest an acreage prices have declined. equal to that of last year. Canning.—Ganners have disposed of most of Financial indicators. their old pack and prices have been advancing. In one section, canners are reported as offering Apr. 20,1917. Previous Previous month. year. $13.50 a ton for tomatoes, which is $3.30 more than last year, and farmers are slow to con-Loan s—P h i ladelphia banks $550,714,000 $553,267,000 §504,361,000 tract at that price. Unless the price is higher, Deposits —Philadelphia I the acreage to be planted in tomatoes will, of Su b r a p n lu k s s reserve—Phila- ! ! 688,213,000 664,257,000 625,197,000 necessity, be much less than last year because delphia banks ! 37,061,000 29,572,000 42,740,000 Discounts and collateral ! of the shortage in farm help, since tomatoes loan s—F e d e r a 1 I Reserve Bank I 1,163,000 1,819,000 573,000 have to be picked promptly when they are Cash reserve—Federal Reserve Bank, ripe. A good crop of berries for canning is percent 73 76 90-day discount ratepromised. Federal Reserve Bank, percent 4 j Department store trade.—Department stores Commercial paper, percent 4 report that business during March was ex- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDEEAL RESERVE BULLETIN. 387 Financial indicators—Continued. to the employment of all available labor at the highest wage ever known, the large supply of March, 1917. \February, 1917.! March. 1910. money, and the consequent demand of the wage earner for better living conditions, better Bank clearings in Phila- ! delphia :31,467,017,000 1*1,251,517,000 81,013,193,000 | grades of food, and the like, causing lessened Bank clearings elsewhere ' j in district ; 97,276,000 I 83,802,000 81.550.000 ! supplies. Total clearings in i j Crops.—-The movement for increased prodistrict i 1,564,293,000 i 1,335.319,000 1.094,748,000 Exports at Philadelphia. i '38,814,000 •: 57', 685,000 ' 15,568,000 duction of foodstuffs has gathered considerable Imports at Philadelphia.; 7,488,000 : 9,042,000 Building permits in i 9,625,000 force, and, in many localities, is being organ- Philadelphia I 3,487,000 ; 4,042,000 Post-office receipts in ! 4,591,000 ized in such a way as to insure good results. Philadelphia... ! 911,000 | 764,000 j Csmmercial failures in I 849,000j Home gardening, use of vacant lots, and indistrict (per Brad- ! street's) ! 61 ! 51 101j creased efforts on the part of the farmer are \ being extensively undertaken. By reason of DISTRICT NO. 4—CLEVELAND. i the very high wages demanded by farm hands, General business in this Federal Reserve dis- | and the greatly increased cost of fertilizing trict has improved during the past month. j materials and seeds, the farmer is hesitating The transportation situation is very much to undertake more extensive cultivation, bebetter. Labor conditions in the industries are ! cause he can see that without a minimum as good as possible, in view of the inadequate| guaranteed price for his product he may face supply. The situation could scarcely be better ! a loss. It would be well promptly to give to under the circumstances. | the farmers such an assurance as would enable Bankers report a readiness to lend full sup- | them to make intelligent plans. This is not port to any Government loans, and the brokers j throughout one of the most important agriand investment houses generally promptly I cultural districts, although it has wonderful showed their willingness to assist without I possibilities in many lines. The successful charge in the flotation of securities. When the farmer who counts his costs may not enter into subscriptions are opened the community served the proposed scheme for feeding the world by this Federal Reserve Bank will respond in without some definite knowledge that he will more than its relative proportion. There are | at least be protected in his expenditures for evidences of economy indicative of the desireI excess crops. of people who otherwise would not have Industries.—In general, all of the industries thought of making permanent investments, in this district are in better condition than a looking to subscriptions to the Government month ago. The labor situation has been reloan. Were it not for the present very high lieved by better weather and voluntary adcost of foodstuffs and other articles entering vances in wages in some linos. The transporinto ordinary daily living, the popular response tation facilities for both raw materials and to the Government call would be tremendous. finished goods have greatly improved, although Figures are not available, but it is a fact still below normal and very much less than that the visible supply of foodstuffs throughout the requirements. The Government's entry this district is much below the average, and in into the industrial field for its own needs, some ordinary articles the supply is practically actual and prospective, has upset a good deal exhausted. This necessarily has tended to of domestic business, because nearly all the price advances all along the line, and to-day plants give a Government order precedence the cost of living is so great that a year ago it over all other business, and there is considerawould have been thought prohibitive. The ble evidence that quotations are withheld for whole condition, though, is attributable mainly materials which might be required by tho Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

388 FEDERAL RESERVE BULLETIN. MAY 1, 1917 United Slates. One of our loading industrial cided falling off in retail lines. This is attribpublications makes the following comment on uted to the natural "between seasons77 lull and this condition: to economies instilled by the war. Despite the great inconvenience and actual losses being Mercantile- business.—Values and volume of sustained, consumers universally are meeting the situa- the mercantile trade are steadily increasing. tion in a spirit of broad patriotism and liberality which Collections are good, The percentage of slow greatly has helped producers to make the necessary accounts in the hands of merchants is considreadjustments. erably less than the average and seems to be Iron and steel.—All furnaces, plants and facimproving. tories are working to the highest capacity Construction.-—Building in the,nine principal possible under the existing conditions as recities is now not seriously interrupted by labor gards transportation and labor. Prices of all difficulties, except in ono center, and substantial products have advanced, the advance in a increases in permits and values are reported. number of instances not being sufficient to meet The following table gives the figures: the increased cost of production. Pig iron, for instance, now at $40 a ton seems very exorbitant, but when it is considered that the cost I ! .P is e s r u m e i d t . s Valuations. c P e e n r t of making it has more than doubled over ordi- increase inor crease nary times by reason of the very material •' Mar.,: Mar.. decrease. or de- ! 1017: 1916."ivLar., 1917.1 Mar... 191H.. crease. increase in the cost of coke, raw materials, and labor, the net profits to the producer are not Akron. Ohio j 527 27")M, 756. 140 So21,713 81,231 234.4 so great as they appear. The problems of raw Cincinnati, Ohio : 1.332 1,460 ' 1,227,305 948,500 ! 278 29.4 Cleveland,' Ohio.! 1,311 1.1 Z\ 1.973.030 1,838,405 ! 134 7.3 materials for future deliveries are at presen C D o a l y u t m on b , u O s, h O i h o i . o . 2 14 9 4 3 '3 1 4 1 0 5 '5 1 7 3 1 0' , . 2 3 4 2 5 7 '8 3 0 5 8 6 , . 9 2 3 4 5 0 I ; 12 2 2 9 5 7 i 1 3 6 4 3 . . 2 4 very serious in all industrial activities. Enc.Ta 142 85 322,189 218,799 ! 103 47.2 Pittsburgh. Pa. •140 332 1.214,590 1.767.612 I 1553. 131.2 Coal and coke.—All along prices for fuel sup-Y T o o u le n d g o st , o v O iH h j i O o. h . i . oj 8 1 8 4 2 8 3 1 -1 0 0 0 1,1 3 4 2 9 3 , , 2 4 6 7 9 5 1', 1 O 7 2 6 2 .3 j 1 4 3 9 5 j I 14 1 7 26: S 1 3 2. . 4 4 plies have advanced a-nd orders for fuel are Total 14,739 1176 j 8,807,636 7,722.074 ! 945,562 1 12.2 very much greater than ea,ii be supplied by the i 1 .Decrease. mines and ovens. There does not seem to be any prospect of securing miners in sufficient I Banking and investments.—There is an underquantity to ameliorate the fuel situation current of hesitancy in bank circles caused by promptly, and the car movement is still unsat- the proposed Government loan and the lack isfactory. Operators, although they have-an of knowledge as to the methods to be pursued unexpirod agreement controlling the wage in placing the loan. This Las, of course, tended scale, have voluntarily advanced wages ma- to a hardening of loaning rates, and perhaps, terially. in some instances, a curtailment of credit Pottery, fireproofing, mid day products.—These which ordinarily might have been granted. industries seem to be working to the greatest In general, however, the banking situation is extent practicable, and unfilled orders indicate the best ever known. The local investment a prosperous condition. With an increased markets have slowed perceptibly. Prices have number of cars for shipment, the plants would been shaded, but the demand is not apparent. be capable of turning out more tonnage. This is believed to be only a waiting for infor- Garments.—Cleveland garment houses report mation concerning the Government financing. that after the biggest Easter trade ever known The table following gives the comparative in the country's history there has been a de- bank clearings in the nine principal cities: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 389 it might almost have been summarized in one Mar. 16 to Apr. 15, inclu- i sive. I Per word—unchanged. Trade is in good volume, Increase or cent decrease, i in- regardless of specific conditions and high prices: crease. 1917 1916 orders in wholesale jobbing plentiful for imme- ,1, diate shipment in all lines; provisions active; 810,619,000 06.8 Cincinnati, Ohio 173,096,359 151,217,800 21,878,559 14.4 manufactures active; building supplies in de- Cleveland, Ohio 287,688,886 175.606.352 112,0S2,534 63.8 Coluinbus, Ohio 47,215,100 42.198.100 5.017,000 11.8 mand; stocks of merchandise limited and buy- .Dayton, Ohio 16, 064", 728 12,922,950 3,141,778 24.3 Erie, Pa •• 7,179,633 5,858,499 1,321,134 22.5 ing cautious owing to high prices. Car short- Pittsburgh, Pa 321,455,910 281.90*, 355 42,517,554 35 Toledo, Ohio 46,493,420 37,988,465 8,504,955 22.3 age is still a deterrent factor, although coal Youfijrslown, Ohio 15.372.166 13,473. 413 1,898; 753 14 receipts at the ports have shown some improve- Total ' 044.075, 202 737,063,931 i 207.011,267 ; 28. C ment. Many new enterprises and improvements are under way in the district, including It would be hard to imagine a better situatwo packing concerns at one of our ports. tion in this district under all the circumstances. Charleston, W. Va.,in this district, has been There must bo hesitancy and misgivings by selected hy the Government as the location some persons. 'Until ihe prospective war taxes for a greet armor plate plant, and the very shall become known a few of ilio commercial logical reasons given for the location in this and industrial linos will be in a measure unsetdistrict are a tribute to its natural resources tled, but there is a-general and hearty support and manufacturing advantages. The fortiof the "pay as yon go7? -plan up to livable ncation of Cape Henry, controlling the enlimits, leaving for future generations only their trance to Chesapeake Bay and its tribureasonable proportion of the burden, taries, including the approach to our National DISTRICT NO. 5—-RICHMOND. Capital, is another tribute to the importance The European war in all of IIs phases, the and advantages of the tidewaters of this seceffect of which has encircled the globe, has tion. In addition to the facilities of the Newbeen since its very outbreak an. unending and port News Ship Building & Dry Dock Co. at all-absorbing subject of discussion in this dis- the mouth of the James River on Hampton trict. This discussion has, with the entry of Roads, enormous appropriations have been the United States as a participant, reached, its made for the • improvement of the Norfolk climax. Navy Yard, fitting that for the erection of the In this district we are setting our faces to largest class of battleships. The Secretary of meet with determination the burdens assumed. the Navy has just recommended an appropria- It would be presumptuous to attempt more tion of $3,000,000 for the purchase of the than to pay tribute to the statement of the site of the late Jamestown Exposition, on purposes contained, in the President's procla- Hampton Roads, for the purpose of equipping mation of April 16, which, will take rank with the property as a naval operating base, inthe great state papers of this Nation. Without cluding piers, storehouses, oil fuel storage, in the least minimizing the seriousness of the training station, recreation grounds for the step taken, this part of the country has met fleet, aviation, and other purposes. Aside the shock with a surprising equanimity and set from their importance from a military and to work to accomplish practical requirements naval standpoint, these developments indipromptly and efficiently. cate the importance of these waters in our A review of our commercial and. financial future commercial development. growth and our fabulous increase io wealth in Crop preparations are being pushed to the the last two years is unnecessary. limit, but rains have made bad roads and a late And now, what of trade for the past month? season. Fertilizer shipments indicate a 10 per If that grim cry, War! had not been heard. cent increase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

390 FEDERAL KESEEVE BULLETIN. MAY 1,1917.. A prompt and liberal response to the new ers in public schools"; "Are you a grasshop- Government loan is anticipated. Banks gen- per or the provident ant?" erally are in good condition but report a better One of our member banks has issued an demand for money, and there is a gradual in- open letter to the farmers of its neighborhood, crease of discounts for agricultural purposes. j using the following interesting figures given out The cry throughout the land is food, more | originally by the College of Agriculture of the food, cheaper food. This bank has distributed University of Kansas and quoted by Hon. over 35,000 of its food circular No. 55 and the W. P. G. Harding, governor of the Federal Redemand continues. The short supply of foods serve Board, in a statement to the press, printhas been evidenced chiefly by high prices ed in the March number of the Federal Rerather than by actual want, but the high prices serve Bulletin: have made living difficult for many, salaried In an average year, with 12-eent cotton, a $60 bale can people especially, and enforced economy which buy— is trying. 86 bushels of potatoes, at 70 cents, or Our enormous export of food products is 750 pounds lard, at 8 cents, or 13 barrels flour, at $4.50, or largely responsible for these conditions, and 375 pounds bacon, at 16 cents, or these need correcting. The new war condi- 100 bushels corn, at 60 cents, or tions which must be faced require the sale of 30 pairs shoes, at $2, or our surplus to our allies and demand that we 700 yards cotton goods, at 8J cents. shall share with them what we have not only at This year, with 20-cent cotton, a $100 bale can only buy— fair prices, but, if need be, at the cost of self- 44 bushels potatoes, at $2.25, or denial. Our own harvests are not the most 500 pounds lard, at 20 cents, or promising, and yet we must prepare to share 10 barrels of flour, at $10, or particularly our standard food crops with our 333 pounds of bacon, at 30 cents, or more needy friends. 67 bushels corn, at $1.50, or 20 pairs shoes, at $5, or The slogan of increased foodstuffs has gone 666 yards cotton goods, at 15 cents. down the line. Every local organization has These striking figures are made the basis of taken up the cry, new ones are being formed an appeal for the raising of home supplies and to spread it abroad in the land, and this syslimiting cotton to the market crop for sale. tematic effort should bring material results. Every garden patch feeds the folks at home, As a sample of the crusade for home supreduces transportation, and releases the less plies, articles with the following headlines, folperishable foods for distribution where most lowed by extensive details, appeared in one needed. Potatoes in this section will be plantday in one of our daily papers: "For better ed on a scale never before approached, and gardens"; "Want jailbirds set to planting— smaller truck on a generous scale. Idlers should be made to plant potatoes on every vacant lot"; "Conference called through DISTRICT NO. 6—ATLANTA. chamber of commerce on agricultural condi- Our Nation's entrance into the war has given tions "; "Response to appeal—Apple grower a quickening impulse to all industries conin West Virginia plants many acres in white nected with war activity and produced little navy beans in orchard"; "Farming in the or no change in other lines, the healthy condicity—How to grow your peas, beans, and tions reported for March being well maintained. beets"; "Banks join in fight to keep up food The greatest interest manifested is in insupply—Will base credits to farmers on re- creased food production. I have for the past two quirement that borrowers increase acreage in months endeavored, through interviews with food crops"; "Lectures on thrift—Home eco- the press and letters to the bankers of the disnomics committee will present series of speak- trict, to draw public attention to the necessity Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL BESEKVE BULLETIN. 391 of a larger individual productiveness. The are scarce. Negro labor continues to move press has taken the matter up vigorously, and northward, and the high prices have prevented the bankers have entered into it with more many farmers from holding back any part of spirit than exhibited in any previous move- jtheir crops for seeding purposes. Many banks ment. Some of the States have appointed in the district are furnishing seed free and offerspecial committees on food production, but still ing prizes for the best crops and withholding more effective work is being done through local credit from farmers that are not inclined to activity with the county as a unit. Boards of |grow other crops than cotton. county commissioners, commercial clubs, and • Retailers and wholesalers of merchandise are United States farm demonstrators have joined ; considerably ahead of this time last year. hands with the bankers, and raised funds by j Bank clearings show large gains. Indications public subscription to furnish seed and fertilizer ! are that the huge Government bond offer to to the farmer for additional acreage, where the public will be quickly absorbed, and will such help is needed. President Wilson's ap- give every line of business a greater stimulus peal to the farmers of the South struck a re- On telegraphic notice from Washington the sponsive chord and awakened the producer to Federal Reserve Bank of Atlanta made inthe importance of increasing the foodstuffs as quiry throughout the district as to the probable an aid to the successful conclusion of war and 3 per cent certificate subscription, and was met as a safeguard against want at home. with a response of over $7,000,000 within a The heavy rains and cold weather delayed few days. These subscriptions came from small spring work, but with the weather more prom- towns and cities as well as large centers, and ising the farmers are turning the soil and rush- many indicated a desire to pay in the total ing work wherever possible. All indications amount of subscription immediately. point to a reduction in cotton acreage, parity The Government's proposed plan for woodenon account of the spread of the boll-weevil and ship building has caused considerable optimism the patriotic feeling awakened by the Presi- among the shipbuilders. This district is rich dent's appeal. There will be a large increase in all wood suitable to shipbuilding, and Gulf in corn, sorghum, velvet beans, cowpeas, hay, ports are turning toward ways and means to peanuts, and potatoes, as these products will take advantage of the situation. bring good prices after the summer gardens Army and Navy recruiting has fallen off in have gone. There has been a great revival, espe- the district. This is probably due to the accially among the city inhabitants, of planting tion of the press of the country in carrying home gardens; and manufacturing and min- daily headlines announcing victories by the ing companies have been urged to organize allies, which is creating the impression among their forces into garden clubs, with the result young men that the war will be over in a month that more vegetables have been planted this or two. Many young men do not care to reyear than ever before. Many boys' and girls' sign positions and interrupt their usual purcanning clubs have been formed, but some fear suits when they feel that the war is about over is felt on account of lack of experience in can™ and that volunteering is unnecessary, ning vegetables and fruits. It would be advisable that the Department of Agriculture, or DISTRICT NO. 7—CHICAGO. Members of Congress, send out literature on Since our last report the international situathe subject of canning vegetables and fruits, tion has undergone a distinct change; many of which are of especial interest at this time. the uncertainties heretofore in evidence have Prices continue to go higher and the visible been cleared up, but as the step was anticipated supply of foodstuffs grows smaller each week. it caused but little disarrangement in business There is plenty of idle land, but labor and seed icircles. Financial institutions are strongly in- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

392 FEDEKAL RESERVE BULLETIN. MAY 3, 1917. trenched, as is evidenced by their reports and Agricultural implements. —Manufacturers rethe insignificant call for rediscount facilities. port a good demand, particularly for corn tools, Savings banks are experiencing a quiet business, and the volume of general machinery sold is in with new deposits approximately equal to the excess of last year. Concerns in this line are withdrawals. There is. without doubt, some finding it difficult to secure steel, and this, hoarding, but the call for funds has not been in- together with the railroad situation, will tend sistent, nor has it been limited to any particular to hamper not only the implement manufacnationality. Most of the withdrawals seem to turers, but also the farmer, who is dependent be made by the uneducated foreign element and upon these tools to properly care for the inthe funds so withdrawn are frequently returned creased acreage contemplated for the coming within a short time. The offering of $200,000,- season. 000 Treasury certificates has been well received Automobiles.—Current business is good, with by banks in this district and indicates that deliveries affected by the shipping congestion when the war loan is offered it will receive the in this line. Dealers are reported well stocked public support. The question of the distribu- with cars, and there is a feeling of uncertainty tion of $7,000,000,000 "United States Govern- as to the future, due to i-he prospective taxes ment bonds is receiving the serious considera- and the general high cost of the necessaries of tion of the banks and bond houses in this dis- life. trict. Bond houses expect to derive an ulti- Building and buUdinci materials.—Construcmate benefit from the sale of these securities, as tion is considerably held up, duo to the prothey claim that there are only about 200,000 hibitive prices of raw material, the increased bond buyers in the United States at this time, cost of fireproof and other commercial buildand the wide distribution of the Government ing being estimated at from 30 to 40 per cent. loan will create a more general interest in bonds Engineers, architects, and contractors look for- 01 all kinds, thereby widening their market ward to active work should the Government after the absorption of this loan. Concerns in require the enlargement of factories manufaccommercial and industrial lines are actively en- turing war supplies, etc. Cement companies gaged, their principal troubles coming from and brick manufacturers find a strong demand shortage of certain raw materials, the labor sup- for their products, but complain of the railroad ply decreasing, due to enlistments, and the de- service and scarcity of labor. It is estimated ficiency in railway equipment. that the Government requirements for cement The Government crop report gave evidence to construct fortifications will seriously tax of a very unsatisfactory condition throughout manufacturing establishments. the United States, and in our territory the situ- Goal.—The available supply is readily taken ation is not all that could be desired. Since at prices substantially above normal, some for the issue of the official data weather conditions immediate consumption and an additional have been favorable and the condition of the amount for storage. There is no present proscrops has shown improvement. The cold pect of lower prices, and mines are turning outweather damaged the winter wheat crop and coal as fast as cars can be secured to make necessarily decreased materially the expected shipment. acreage. Farmers are making every effort to Distilling and brewing.—Concerns in these take advantage of the high prices for grain and lines are naturally watching with the keenest the total acreage-to be planted this year will apprehension the movement toward prohibiprobably be greater than in preceding seasons. tion, and at this time the high cost of grain is The damaged winter wheat land is being tending to decrease the production of whisky. plowed over and put in corn and oats. Maltsters have plenty of orders; in fact, one Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY .7, T91.7. F.EDEKAL BESEBVE BULLETIN. 393 concern is nearly 1,000 carloads behind in use has been reduced to a minimum. Collecshipments. The industry is operating to the tions vary from fair to good. fullest capacity commensurate with the car Leather.—Trade has been quiet during the supply, but the manufactured product is piling past month, and what tended to be a weak up and has forced the closing down of some market lias been supported by the expectation plants. of large Government orders. Labor is scarce, Dry (foods.—Wholesalers are finding a gen- and collections satisfactory. erally active demand, which is carrying sales Live stock and packing.—Reports indicate that above last year, although this may be due in the supply of live stock is limited and market part to the increased values. Some of the prices have increased substantially. Cattle have purchases are probably speculative, and collec- come to market in good numbers, caused by the tions are fair. In the retail trade cold weather increased value of fodder and the high prices has held back the distribution of goods, and to be realized OR their sale. Packing concerns there has been -a spirit of conservatism evi- are busy and are finding difficulty in supplying denced on the part of the consumer and the their labor requirements. By-products are well tendency to buy freely is not so evident. j taken. Furniture:—This line has had a setback since j Lumber.—A good demand has developed for the declaration of war and orders have been cut.i lumber at entirely satisfactory prices, and down, buyers apparently holding off for the • with sufficient shipping facilities in "this line purpose of analyzing the trend of the market. I lumber dealers look forward to an active trade. Collections are fairly good. : Lumber values are advancing, collections are Grain.—During the past month the markets ! satisfactory, and the general outlook is favorfor all cereals have advanced materially, and : able. There appears to be a shortage in mafollowing the Government report showing .an.| hogany and walnut. unfavorable outlook for the winter wheat crop, j Mail orders.—Sales in this line show a the quotations for this cereal have advanced to considerable gain for the same period last year the highest prices known in years. Conserva- for the states in our district. tive grain firms are curtailing their operations Piano manufacturers.—A normal trade is as much as possible on account of the great reported, but piano supply houses find a falling risk in handling grain at the present prices. off in business. Collections are good. Railroad equipment is in short supply, but this Shipbuilding.—There is no change in this situation is easing up a trifle. industry, which continues active, with indica- Groceries.—In the city of Chicago the volume tions of a similar condition for some time to is satisfactory, but the distribution through come. other centers bears only a fair comparison to Steel.—The mills are pushed to capacity to last year if the increased value of the merchan- supply the unusual demand from foreign and dise is taken into consideration. Collections are domestic consumers, prices continue to harden, generally satisfactory, but there is evidence of and some of the concerns in our district are slow pay in certain sections. A more or less booked up for the remainder of the year and ineffectual attempt is being made to curb the in some departments into next year. The speculative tendencies of the consumers who | labor supply is short and collections satisare buying in large quantities in anticipation I factory. of further rise in prices. I Watches and jewelry.—Business during the Hardware.—-A good demand still exists in thisI past month in these lines has been of satisfacline, and it appears that tin plate is being re- tory volume, and manufacturers and retailers stricted to the caimers of perishable goods for look forward to a continuing activity during making containers. The quantity for penoral ; the spring. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

394 FEDERAL RESERVE BULLETIN. MAY 1, 1917. Wool and woolens.—The raw wool market is trict have carried on vigorous campaigns for firm, and woolen goods houses are finding it diversification of crops. Farmers in this dismore difficult to secure fabrics of good value, trict began to realize the danger in dependence even at the increased prices. Manufacturers on one crop before the war and for a year or so are operating at full volume, and retailers are many of them have been raising sufficient food covering their requirements freely. Collections prodxicts to care for their wants. Therefore, arc fair. The knit goods business is extremely on the whole, the people in this district fully active, with advancing prices. Difficulty is realize the industrial and agricultural demands experienced in keeping productions up to which will be made on this country, and there requirements, and the principal complaint has been an intelligent discussion of ways and appears to be the trouble experienced by the means to meet such demand. The present mills in supplying the demands of the tirade. supply of foodstuffs and the prospects for the Clearings in Chicago for the first 20 days of coming crops are receiving the careful con- April were $1,442,000,000, being $393,000,000 sideration of all classes of people. The press more than for the corresponding 20 days in is conducting a campaign urging a larger pro- April, 1916. Clearings reported by 23 cities in duction of food crops, and reports indicate that the district outside of Chicago amounted to this campaign will have beneficial results. The $272,000,000 for the first 15 days of April, State boards of agriculture, commercial clubs, 1917, as compared with $226,000,000 for the and other organizations throughout the disfirst 15 days of April, 1916, Deposits in the trict have undertaken the work of organizing eight Central Reserve City member banks in the food producers. Under the supervision of Chicago were $740,000,000 at the close of the Missouri State Board of Agriculture meetbusiness April 20, 1917, and loans were ings have been called in every county in $500,000,000. Deposits show an increase of Missouri and the campaign for food preparedapproximately $7,000,000 over last month, ness is well under way in this State. The tone and loans a decrease of approximately of all business seems to be one of conservatism, $10,000,000. with a strong underlying feeling of confidence. In an effort to conserve the grain supply dis- DISTRICT NO. 8—ST. LOUIS. tillers in some parts of the district have agreed The opening of war found this district well to shut down for the period of the war. prepared against any emergency; In my April Since April 1, we have received reports from 1 report I pointed out that the uncertainty as a large number of jobbers, wholesalers, and to our foreign relations had had a healthy de- manufacturers, located in all of the principal terrent effect on business activity in this dis- cities in this district. These reports covered trict. Business men throughout this district practically every line of industry. Each line have discounted the effect of our entrance into reports a heavy increase in business, unusually the European war and business in general con- heavy orders for future deliveries, and satistinues at a very high level. Banks in the dis- factory collections, with a smaller percentage trict, especially outside of the larger cities, are of past due accounts than is usual at this reported to carry reserves in excess of their period of the year. The retail lines report legal requirements, and there has therefore similar increases. Prices of general merchanbeen no change in bank rates. Money con- dise have gone up from month to month, and tinues easy. The cost of living is increasing it now appears that gains which are reported and the rate of increase seems to have gone up by amounts in dollars are caused somewhat since we entered the war. by the increase in prices rather than by the For a number of years the State bankers7 increase in quantity shipped. There is also associations in most of the States in this dis- a well defined indication that the increased Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAT 1S 1917. FEDERAL RESERVE BULLETIN. 395 costs are beginning to shut off the demand for cate that this will limit the acreage in spite of ; such merchandise as may be termed luxuries ;the tempting price of cotton. There is a rather than necessities. This applies to prac- scarcity of grain in the cotton belt and protically all lines except provisions. \ visions of every kind are climbing higher. The The prices of all steel products have gone up |old-crop movement from Memphis is still devery rapidly in the past few months. Some ;layed, principally on account of car shortage. manufacturers have been hampered by ina- iThe stock on hand on April 14, 1917, amounted bility to obtain raw material and others have j to 326,000 bales, as against 216,000 on the same been hampered by strikes and other labor date in 1916 and 168,000 in 1915. troubles. One or two cases have been re- It is reported that considerable ground has ported where manufacturers have made large been prepared for the corn planting and profits through reselling their contracts for some planting has already been done on the raw material to others not equally well supplied. southern sections of the district. Frequent Climatic conditions during the later part of rains the early part of April have retarded March and the first half of April, have been farm work. Plowing and planting have also more favorable than the}^ were the early been hampered by the scarcity and high cost of months of the year. Generally speaking, the seed and the lack of sufficient labor. The oats rainfall was deficient throughout January and crop appears to have been planted under favor- February and the ground needed moisture. able conditions. The potato acreage is larger Precipitation in the southern portions of the than usual and would be still larger were it not district was largely above the normal in March, for the almost prohibitive cost of seed. and in fact the continued rainfall has hampered The outlook for the fruit crops, except agricultural operations. The precipitation in peaches, is fair. The strawberry crop is bethe northern half of the district was approxi- ginning to bloom in the southern portions of the mately normal during the latter part of March district, but indications are that the crop is and somewhat above the normal during the material^ smaller than last year. In St. first half of this month. It is believed that Louis and other large cities provisions are genthis has improved the crop prospects. erally high, and in some cases scarce. The The Government report on the wheat crop movement of fresh provisions—cabbage, tomaissued April 7 showed that the April 1 condi- toes, asparagus, celery, strawberries, onions, tion in all of the States in this district was etc.—is later than usual. The onion movement materially below the average. The outlook from the Texas district began a few days ago for the winter wheat crop is not bright. The and is now in fair volume and some relief is crop in Missouri was badly damaged, but the anticipated. The stock of canned goods in condition is believed to be improving slowly the hands of commission merchants and wholebut steadily, particularly in the district from sale grocers is reported to be extremely low, Marion to Franklin County. The condition due in part to a shortage in the yield last year, of the wheat in Dade and Lawrence Counties, and in part to the small " carry-over " from the Mo., is reported to be very poor. previous season. Prices in many instances Reports on the new cotton crop indicate have increased in the past few months 40 to 80 that the season is two or three weeks late. The per cent. Sugar is reported to be equally cold and rainy weather in the belt has delayed scarce and the jobbing price of this staple has the planting and cultivation of the ground, so increased from 7 to 10 cents in the last few that conditions are not entirely favorable. months. Little relief in the canned goods There is a strong agitation for an increase in the situation can be looked for until the new crop production of foodstuffs, and the reports indi- comes forward in September and October. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

396 FEDERAL BESERVE BULLETIN. MAY 1, 1917. The St. Louis National Stock Yards reports with unusual promptness and with a degree of a slight decrease in the receipts of cattle, liberality that speaks well for their patriotism. sheep, and horses and mules in March, 1917, The Ninth Reserve Bank has entered into as compared with March, 1916, and an increase close cooperation with bankers, business men, in hogs during the same period. The price of and farmers in the grain-growing areas of hogs has gone up from month to month in this Minnesota, North and South Dakota, and district, on April 15 being $16.40 a hundred. Montana, and during the last half of the month Building permits for March, 1917, as com- was active in the most intensive campaign this pared with March, 1916, show an increase in district has ever seen to increase the crop Little Rock and in Memphis, and a decrease in acreage at least 10 per cent and provide for Louisville and St. Louis. Building generally record-breaking farm crops this year. Close seems to be affected by the high cost of all cooperation with the railroads was secured and materials. the bank was able to be of great service in Postal receipts for March, 1917, show satis- hurrying forward delayed seed grain and agrifactory increases in Little Rock, Louisville, cultural implements by fast freight, and to do Memphis, and St. Louis. a large amount of work to provide seed wheat of high quality to replace inferior grain. The registration of automobiles on April 1, 1917, for the States wholly or in part within Bankers everywhere have been advised that this district, show a substantial increase as no honest and reliable farmer should fail to compared to April 1, 1916, Illinois having plant because of hesitation in applying to local gained over 54,000 machines, Kentucky over banks for money, and the State banks of the 11,000 machines, Missouri over 34,000 ma- district have joined with the utmost heartiness chines, and Tennessee over 9,000 machines. with the member banks in loaning freely and The bond market is quiet. Banks and in- upon a liberal basis for the purchase of seed, dividuals generally are out of the market feed, and for the employment of farm help. pending the announcement of the Government Careful investigation fails to show a single bond issue. It is expected that the public instance where any farmer worthy of credit or subscription will be large. capable of increasing his acreage has not been Commercial paper rates have increased a able to get support from his bank, and many half of 1 per cent in the past 30 days, rates bankers have personally loaned money to the now ranging from 4J to 4f per cent, with a farmers in order to avoid showing overloans. large majority of best names offered at 4J In the grain areas of North Dakota the bankers per cent. Brokers reported a slump in business have entered into the closest relations with at the time of our entrance into the European their farmer customers and many of them have war, but the market seems to have recovered been devoting the larger part of their time to its confidence. The supply of paper is ample, personal work in securing a maximum acreage. with country banks more active in the market As a result it is probable that in North Dakota, than banks in the larger cities. Bank rates to where because of severe hail damage and a customers show little or no change. drought last year there was a strong prospect of less than the normal wheat acreage, that the DISTRICT NO. 9—MINNEAPOLIS. actual crop will be increased at least 5 per cent, There are no visible signs in the district, of and probably as much as 10 per cent. It any adverse effect of the declaration of war. appears to be a certainty that as a result of Banks, business men, and farmers alike, in the these efforts the acreage in eastern Montana, States of this district, are in excellent shape, South Dakota, and the grain sections of Minand preparing for a busy season. The banks nesota will be very largely increased, while the are meeting the spring demands of the farmers corn planting will be on a heavier scale than in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL RESERVE BULLETIN. 397 any previous year. Carefully systematized DISTRICT NO. 10—KANSAS CITY. and intensive organization is now in progress Tho tenth district is essentially a food-proto carry the supervision over the increased ducing section and, with the satisfactory proplanting campaign, down to particular town- duction and unprecedented prices that have ships and sections of land, and individual prevailed, enters the world-wide struggle with farmers living thereon. This has been ac- the knowledge that it is prepared, as never complished through a simple system of dis- before, to do whatever may be required of it, trict and county organization, with the respon- and with the assurance that the country at sibility delegated to local business men and large is well equipped to meet and conquer all bankers. eventualities. Practically all business con- Side hy side with this effort, very careful tinues to run ahead of the volume of last year, attention is being given to the live-stock situ- the only untoward features being the ination, and arrangements are being made to creasing prices of necessities; reports of a bring in breeding sows and other female stock shortage in the visible supply of foodstuffs, as fast as farmers equipped to handle it can be aggravated by serious damage to the wheat located and listed. crop; and the increasing complaint of the short- The farm labor situation is serious and will age of labor and materials for the prosecution become acute as soon as haying begins. An of all industries in the face of attractive prices. organization is being formed to cover the Tho financial interests of the district, well aware entire district and will devote itself to the of the task before them, exhibit a marked handling of this problem. degree of optimism. Banks are not curtailing Industries are active and at urban centers, loans, but, on the other hand, are in the market and over the district as a whole, the fact that for short-time liquid paper and are everywinter snows have largely been saved and that where assisting the agriculturists in the prepthe moisture has gone into the ground, has aration and care of crops, and are confident acted as a stimulus to trade and to establish that their proportion of the Nation's financial better confidence in business circles. Soil requirements can be met without a disturbing conditions are excellent, and so far as the advance in discount rates. crop outlook can be determined at this time, Agriculture.—Rising above all items of inthere is little that could be desired. terest is the united and determined effort put The demand upon commercial banks at forth for the organization and mobilization of urban centers has been active, but not greater the agricultural resources of the district, the than is usually experienced during the spring utilization of all lands not now under cultivaplanting season. Rates maintain about the tion, and the growing of maximum crops on all same levels as for some time past. Spring lands now under cultivation, to meet food reconstruction is in good volume and shows less quirements in the present crisis. Committees reduction as a result of the extremely high have been or are being organized in every State prices for material than was expected. Bank to handle every phase of the situation, and the clearings are generally increased, and railroad result will unquestionably be of the utmost and postal receipts are large. importance. The various bankers7 associa- Over the district, as a whole, the condition tions are cooperating, and the necessary finanis extremely satisfactory. Business is on a cial assistance will undoubtedly be furnished sound footing, and banks are well prepared to enlarge and intensify farming operations. for any calls that may be made upon them. The importance of this movement is readily War conditions have been analyzed in advance, apparent, for although the general drouth and business men everywhere have made suf- seems to have been thoroughly broken, the fact ficient preparation against any effects that remains that in Kansas and Nebraska, the two may be anticipated in their particular line. leading winter wheat growing States, the crop Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

398 FEDERAL RESERVE BULLETIN. MAY 1. 1017. has suffered enormous damage. Nebraska should result in the operation of the property reports a condition of 35 per cent of normal, involved upon a much more extensive scale with a decline of 50 points from the condition than ever before. The Miami field of the of December 1 last. In Kansas the condition Missouri-Kansas-Oklahoma district is expandon April 1 was 45 per cent of normal, a decline ing rapidly, this camp having become one of of 38 points since December 1. Undoubtedly the richest zinc fields in the world. much of the acreage in these States, which Oil.—The price of crude oil, contrary to the must now be abandoned, will be planted to experience of other products, has not changed, other grains and to forage crops. The supply but oil m&n are united in the belief that higher of all forage seeds is the shortest known in prices must soon arrive, as there is the greatest many years, with extremely high prices. The demand in the history of the industry and physical condition of the soil is reported as daily production is showing a decrease. The better than usual for corn planting, and, as this call to arms and response of the field workers, is a more important crop than wheat, this dis- the shortage of casing, and the scarcity of rigs trict may yet produce its full quota of the are matters of deep concern. The refining Nation's supply. situation has remained quite regular, and it is Live stock.—There was a net increase in the reported that there is probably less gasoline movement of cattle to the markets in March in storage than in the history of the midconover the same month last year, this activity tinent field at this time of the year. being really greater than anticipated in the face Lumber and construction.—Order files are reof curtailed supplies, but many continued to be ported heavy and stocks on hand are very low, prematurely marketed by reason of increasing with the market going higher ever}?- day. Car high prices and shortage of feed. The feature shortage and the broken condition of mill of the trade was the strong demand for breeding stocks continue to be deterrent features. Mancows and heifers at the highest prices ever ufacturers are much more concerned in the known. Trading in hogs was active, prices filling of orders already booked than in the exceeding all predictions. Sheep likewise addition of new business. Building and engibroke all previous price records, with the final neering operations continue active, with much value of from S3.50 to S3.75 per hundredweight work in prospect. Eleven important cities in higher than those of last year. The annual the district show an average increase in value movement of cattle from Texas and New Mex- of building permits issued for March over the ico to the long-grass districts in Kansas and same month last year of 74.5 per cent, the Oklahoma, to be fattened for the fall market, highest gain being 324 per cent and the highest is in full swing, the number probably equaling loss 10 per cent. last year. Shortage of stock water is reported Labor.—Labor is unusually well employed in some of the grazing districts, but there has at increasing wages, and there are no disturbbeen sufficient moisture to make a good start ances of importance. A scarcity is becoming of grass for grazing purposes. more and more apparent, particularly on the Mining.—Owing to the condition of the | farms and in the mines. Twenty-two of the roads incident to the usual spring break-up, the | leading coal mining companies of Colorado, tonnage of ore marketed in Colorado showed a\ affecting about 90 per cent of the coal mines slight falling off in March over previous months,I in the State, recently announced a general and the acute shortage of mine labor caused a I wage increase of approximately 10 per cent, further curtailment in production. Though I effective May 1, an action that was purely dull in other respects, March was a most event- i voluntary. ful month in the sale of Colorado mining prop-j Wholesale and retail.—The commercial situerties. Two very large deals were consum- | ation shows no radical change and general busimated, involving many millions of dollars, and | ness continues good, with collections entirely Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 399 satisfactory. There is no reckless advance and subsequent developments have not seriously buying, indicating that dealers are operating interfered withjbusiness in the district. Prior along conservative lines. Wholesale dealers to the formal [declaration of war there was an in dry goods, notions, and shoes report a satis- atmosphere of uncertainty in various industries. factory volume of business, with orders for fall Some disturbing elements were noted and an delivery in excess of a year ago and reorders undertone of caution prevailed. This condifair. Retail trade in seasonable merchandise tion, though still slightly apparent in some has increased under the influence of warmer quarters, is certainly not as pronounced as weather. Grocery and provision markets are expected. It is, of course, too early to adjust unsettled as to prices, but trade is active. ourselves to the new situation of the Nation's Flour milling has been fairly active, consider- being at war or make a forecast as to the ultiing the unsettled wheat market and the very mate effect on business. Up to the present high current prices. Buyers are slow to make writing, however, conditions following our new commitments, but mills are running about entrance into the conflict are not disturbing. three-fourths capacity. In implements, tractor Patriotism runs high in every section, as evidenced by public demonstrations on every hand, orders have fairly swamped the jobbers, and and we may be depended upon to do our full it seems apparent that the demand will exceed part in furnishing men, equipment, and foodthe available supply. Preparation is being stuffs. The country-wide campaign for an made for an immense demand for corn tools. increased food production is meeting with an Financial.—Bank deposits and post-office unselfish response throughout the district. receipts are reported in substantial increases over last year. Reserves in banks are in a Much has been written as to the absolute decidedly healthy condition, and it is gratify- necessity of an increased food production. ing to note from the statement of the Comp- Meetings are being held by civic organizations, troller of the Currency that of the four States bankers' associations, and various societies in the Union whose country banks showed the and clubs in ever}7- part of the district and every largest percentage of reserves, three of them, possible influence is being brought to bear on viz, Colorado, Nebraska, and Kansas, lie farmers and the people generally to grow an wholly within this district, holding first, second, increased supply of foodstuffs. Throughout and fourth places, respectively. Kansas State the district, organizations of fanners are being banks show deposits of double what they were effected, whose members are pledging themfive years ago at this time. Reports from selves to grow more food products, and a conbankers throughout the district are decidedly servative estimate would be that at least oneoptimistic, and this feeling is admittedly based third more land will be planted in these crops than ever before. The home-gardening propaupon confidence in the Federal reserve system ganda and the planting of vacant city lots in and its ability to meet any emergencies. The garden truck is also having results, and more average gain in clearings for 15 cities in the vegetables are being grown than in previous district for the first three months of the current years. While this movement may be thought year over the same period last year is 43.1 per to be more sentimental than practical, at the cent. There has been no change in discount same time the public has responded liberally rates, but a feeling exists that they will graduto this plan. Not the least factor in these ally strengthen. campaigns for increased food products is the cost of living. Prices of all foods are reaching DISTRICT NO. 11—DALLAS. new records from day to da}', and while it was While the crisis in our international affairs thought some time ago that the level had been was reached with the formal declaration of war reached, prices continue to rise and records are against Germany, the effect of this condition, being broken daily. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

400 FEDERAL RESERVE BULLETIN. MAY 1, 1917.. The yield of the grain crops and the large up, therefore, this district is in an excellent areas planted in foodstuffs will, of course, de- condition to contribute its full part toward the pend upon weather conditions. The grain food supplies of the Nation and for export to crop in the district at the present time is in the countries at war. various stages of development. Recent rains In north, northwest, east, and central Texas over the wheat belt have been of material the progress of the cotton crop is all that could benefit, as up to April 1 the condition of the be desired at this season. Cool nights have crop was poor. According to the Government affected the plant and held it back. In south Crop Report of April 1 there was a deteriora- and southwest Texas the weather has been too tion in Texas wheat of 11 per cent from De- dry and planting operations are backward. cember 1 to April 1, or from 86 to 75 per cent There is undoubtedly an increased acreage in of a normal. Any estimate as to the probable the staple, but it is too early to make an estiyield of the Texas crop would be purely guess- mate as to what it amounts to. work. Authorities state, however, that the There is little change of interest in the bankpresent condition is most favorable and with a ing situation. Rates are unchanged; demand good increase in acreage, particularly in north with member banks is normal for the season Texas and the Panhandle section, the Texas and deposits are heavy. When war was decrop should be around 25,000,000 bushels. clared there were some withdrawals by foreign The condition of the corn crop varies from depositors, but our information is that this 69.5 per cent in northwest Texas to 97 per activity was only temporary. Statements of cent in northeast and central Texas. The member banks disclose large reserves. Deacreage is around 92 per cent. The poor con- mand with this bank is light, indicating that dition of the crop in south and southwest Texas member banks have not as yet entered thewhere, in fact, planting has been delayed on borrowing season. Banks in the cattle-raising account of dry weather, is more than offset by sections of the West report that demand with the favorable condition of the crop in north them is considerably lighter than a year ago. and central Texas. Banks in the Panhandle, however, are having* The condition of the oat crop is around 85 rather an active demand. The bond market per cent of a normal; acreage 92 per cent. Con- is active, especially for municipals. The recent servative estimates of the yield this year of income-tax legislation has created quite a grain crops would be 20,000,000 bushels of market for this class of securities. Clearings wheat, 25,000,000 bushels of oats, 150,000,000 for March were $234,489,761 and for the same bushels of com. When it is noted that Texas period last year were $182,450,253, or an inalone consumes about 30,000,000 bushels of crease of $52,039,508, or 29 per cent. wheat, 35,000,000 bushels of oats, and from Building operations for April were not 200,000,000 to 225,000,000 bushels of corn, and affected by the war, nor the scarcity of matethe State rarely produces that amount, the rials and the high cost of labor, and, while importance of growing sufficient food for our showing a small decrease in number of permits own consumption will be seen. In addition to issued, a substantial increase in the valuation the campaigns for increased production of of such permits will be noted. The figures are: grain and other foodstuffs, much interest is March, 1917.—Number, 1,095; valuation, being taken by farmers in raising live stock $2,850,768. March, 1916.—Number, 1,185; and poultry. Our correspondents report that valuation, $1,831,360. Decrease in number, never before have farmers devoted more at- 90; increase in valuation, $1,019,408, or an intention to this matter. They are raising live crease in valuation of 55 per cent. stock not only for home consumption but will Lumber and other building materials are. have a surplus to ship to the markets. To sum quite active. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 19.17. FEDERAL RESERVE BULLETIN. 401 Wholesale trade in groceries, dry goods, ration of war has greatly stirred the whole drugs, and shoes is satisfactory and collections people. are good. There is a tendency in the grocery A few days before our declaration of war, trade to overbuying, on account of rumors of when all wore expecting it, Melba sang for the scarcity of food and continued high prices. benefit of the British allies to an audience of Wholesalers are endeavoring to discourage 12,000 in the civic auditorium at San Francisco. this tendency. The occasion was typical of the spirit of the Labor continues well employed. While en- Pacific coast in its quick response and readiness listments for service the past month have been to serve. Money was showered upon the stage, active, naturally causing a withdrawal of men the gifts of the evening aggregating $20,000. from business pursuits, the effect on labor is The twelfth district will probably play no not as yet noticeable. The principal unfavor- spectacular part in this war or in the preparaable feature in the labor situation in Texas in tion for it, but nevertheless will contribute its the emigration of workmen to northern and important share. Copper particularly from eastern points, many thousand having left in Arizona and Utah and lead from Idaho are the past six months. With the crop season pouring forth in a steadily increasing stream to nearly at hand, the shortage of laborers will meet war needs; quicksilver, tungsten, mangabe seriously felt unless this movement de- nese and other rare metals from California; creases. •. ship timbers from Oregon and Washington; Post-office receipts of the principal cities of live stock and wool from Oregon, Utah, Idaho the district show an increase for the month of and Nevada, and a vast variety of food crops March over the previous year. The figures from the entire fertile district. are: March, 1917, $396,582.94. March, 1916, Food is so easily produced in most parts of $345,801.27. Amount of increase, $50,781.67; this district, and during so large a part of the per cent increase, 15. year, that the increased cost of living bears Exports from Galveston for March were lightly here. Much sea food is available along $14,126,997, an increase of $644,824 in amount, | the 1,500 miles of Washington, Oregon and or 5 per cent, over same month of 1916. | California sea coast, and any householder hav- Cool weather during April has affected retail i ing a few square feet of ground may protect trade. Easter buying, while good, was below himself by growing his own green vegetables. normal on account of the unseasonable weather. It is stated, however, that vegetables constitute only 6 per cent of food in point of cost, DISTRICT NO. .12—SAN FRANCISCO. while meat, milk and eggs constitute 38 per During tho Civil War, with no transconti- cent. So the fact that magnificent green nental railroad and with an occasional ship, asparagus is now retailing here at 6 to 8 cents long en route, the chief means of communica- per pound is of small consequence compared tion with the eastern part of this country, it is with the fact that cattle and sheep have winsaid that the Pacific coast had little effective tered badly, that the ranges have scant grass, realization that a war was in progress. To and that hay is almost unobtainable, even at some extent the same is true now even with $30 to $40 per ton. present speedy communication. There is rela- Food reserves have been well-nigh exhausted. tively little manufacturing in the twelfth For instance, onions are being imported from Federal Reserve district, and consequently the Australia; a single shipment of beans from fever of war is little in evidence, with an excep- Japan was valued at $1,000,000. Potatoes, tion here and there, as in shipbuilding. So the the crop of which was much below normal, are course of current affairs appears to be little in meager supply, partly because of heavy shipdifferent from normal. Nevertheless the decla- ments to the East. Stocks of canned vegetable Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

402 FEDERAL RESERVE BULLETIN. MAY 1, 1917. and canned fruits are practically sold out and Heavy snows, however, while causing loss of advance sales have already been made of the live stock, assure abundance of irrigation water, principal part of the coming season's pack; with corresponding certainty of crops depend- 100,000 cases, amounting to 30 carloads, of ent upon it. canned salmon were recently sold to the Italian Oregon reports some damage to winter wheat, Government by Seattle brokers and little re- the April 1 Government estimate for Oregon mains available of last season's pack. Similar being 84 per cent (against 96 per cent for a 10reports are made regarding certain other food year average) and 70 per cent for Washington. reserves. It is however shown by the investi- In Oregon, Washington, and Idaho about gations of the United States Department o* 2,534,000 acres were planted in winter wheat, Agriculture that on April 1 the stocks of frozen' an increase of 34,000 acres over the preceding cured and pickled meats and stocks of cheese year, but 290,000 acres less than for the winter in storage in the Pacific coast States were as of 1914-15. large, and in some instances larger, than a year Conditions in California are generally quite ago. favorable from the standpoint of considerably The autumn was early and cold, and the increased acreage and good present condition spring has been cold and backward, so that of growing crops. It is anticipated that the growth is nearly a month behind the normal. barley crop may amount to 900,000 tons- This, coupled with damage done by frost here This would be an increase of 400,000 tons over and there to fruit and vegetables and thus far last year's crop. It is estimated that 100,000 (April 19) a generally deficient precipitation* acres will be planted to rice, as against 60,000 gives a less promise of abundant crops than last year. The acreage in beans and sugar could be desired at a time when every pound of beets is greatly increased, many tracts being food produced or saved from waste helps bring planted which had hitherto either been used the war to an end. for grazing or not at all. In Idaho the number of cattle, sheep, and Apricots, peaches, and almonds have sufhogs available for sale this year will probably fered some damage from frost, but the outlook be 10 per cent below normal. In Nevada, par- is generally favorable for full fruit crops. In ticularly in the northern part, losses have been Washington and Oregon the backward spring heavier than at any time since the hard winter has been favorable for the fruit in avoiding of 1889-90, and may run as high as 25 per cent. frost damage. Because of the backward spring, grass has been Mining continues extremely active, hampered very slow in starting, and in consequence of somewhat by scarcity of labor and shortage of this, there may be further losses. In Utah i cars. Petroleum production in California in there has also been considerable loss because of | March averaged 263,513 barrels daily, which excessive cold and lack of feed. In eastern and was about the same as in February and comsoutheastern Oregon feed is especially short. I pared with shipments averaging 291,072 bar- Sheep men are buying hay to feed during the | rels per day, stored stocks declining 854,333 lambing season and in some cases have shipped ! barrels to a total of 41,173,861 barrels, which it by express from the Spokane region. Much I compares with 60,820,315 barrels on May 1,1915. hay has been shipped from western Oregon to ; An 8,800-ton ship built for the Cunard Line California. One just returned from an ex- I was recently launched at Portland, the first tended tour through California reports sufficient I steel ship ever built there. The yards there feed on the ranges in this State and the cattle I are said to have a capacity of 40 ships, both in good condition. He states that the chief steel and wood. Seattle reports shipbuilding concern is not about the present feed but the I contracts now exceeding $76,000,000. One impending great shortage next fall. j shipbuilding concern in San Francisco is now Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL BESEBVE BULLETIN. 403 launching big steel steamers at the rate of one i On the other hand useful offers of patriotic every three weeks. cooperation are being made. W. H. Crocker of The "West Coast Lumbermen's Association re- ;San Francisco, as president of the Crocker Huffports that 127 mills have a balance of orders iman Land & Water Co., has offered for this year unshipped amounting to 17,475 cars. Because ; the free use of 3,000 acres of land at Merced, of car shortage 33 per cent of the mills axe not [Cal., adapted to raising corn and beans with soliciting orders in transcontinental markets. sufficient free water for making the crops. Clearings for 19 principal cities of this dis- ; Over 1,000 acres, were applied for in the first trict for the month of March, 1917, increased \ two days, chiefly in 20 acre tracts. 34 per cent over those for March, 1916, Salt \ H. G. Humphrey, as secretary of the Union Lake City leading with 59 per cent, followed by Land & Cattle Co. of Reno, Nev., has offered to Spokane with 38 per cent and San Francisco • the Government the free use of 3,000 acres or with 36 per cent. Building permits for the ; more of land, suitable for raising wheat, tosame 19 cities decreased 7 per cent for March this : gether with free use of a large amount of equipyear over the corresponding month last year, i ment and horses for farming the land, making At this time of war preparation, when there j it necessary for the Government to furnish should be supreme effort to gather effectively i only the men and the seed. the Nation's energies in men, materials, and; money, California's method of collecting tax : If such a spirit becomes general and if payments stands out in contrast, millions of j "plant the limit" is made the slogan, we shall actual gold coin being withdrawn from bank |have the surplus of food so essential for us to reserves and locked up in public treasuries. • provide for our allies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

404 FEDERAL RESERVE BULLETIN. MAYI, 1917. FOREIGN EXCHANGE RATES. part of the world and under the political and financial control of the British Government. In the tables below and accompanying The rates used for the compilation and diagrams an attempt has been made to present diagrams represent the high rates quoted durin a uniform manner the changes in exchange ing each month, all expressed in percentages rates since the outbreak of the war. The of the American equivalents of the par or mint material used for the tabulation and the values of the respective monetary units. This diagrams is made up chiefly of quotations method of presentation necessitated the republished in the December, 1916, and April, conversion of quotations of rates on Paris, 1917, Federal Eeserve Bulletins. These data Zurich, and Milan, and their restatement in have been arranged under three main heads: terms of United States money. (1) Exchange rates on markets in belligerent It is easily seen that this is the only mode of countries. presentation which permits of any fair comparisons of the upward or downward course (2) Rates on markets in neutral countries of exchanges on the various markets. Some in Europe and South America. In view of the difficulty was experienced in choosing a basic considerable fall of exchange on Rio de Janeiro quotation for the silver-standard countries. and the low level maintained for the period The basic figure chosen was the average price since September, 1915, it was found impracof silver in London for the calendar year 1913 ticable to plot the course of exchange rates on (60.458 cents per ounce, British standard, the Brazilian center as part of the second 0.925 fine). On this basis the average 1913 diagram. Iii the case of the rates on Buenos values of the Hongkong dollar and the Shang- Aires, the par value of the paper peso was hai tael were figured and these values, 47.16 taken at the officially fixed rate of 44 per cent and 65.49 cents, respectively, were used as the of the gold peso (96.5 cents gold), or 42.46 basis for calculating the percentages shown in cents. the tabulation and plotted in the diagram. To (3) Rates on markets in silver standard complete the analysis of the course of Far Eastcountries. The markets chosen were Shanghai, ern exchange since the outbreak of the war, the principal neutral financial and commercial there have been added figures and curve indimarket in the Far East, and Hongkong, the cating the course of the silver price in London most important transshipping point in that for the period under review. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. EEDEKAL EESERVE BULLETIN. 405 Movement of exchange rates {highest rates for drafts during month) on principal financial centers during period from "June, 1914, to March, 1917. 1. Rates on markets in belligerent countries. London Paris Berlin Petrograd i Milan ! Vienna (4.S665=100). (19.3=100). (95.2=100). (51.5=100). ! (19.3=100). J (20.3=100). 1914. Per cent. Per cent.] Per cent. \Par cent.' Per cent.l Percent. June 84.891 100.50 $19.42 100.62 ! S95.44 : 100.25 Sol. 56 | 100.12 • $19.37 100.36 ; $20.32, 100:10 J A S u e u l p y g t u e s m t ber ! ! 5 5 5 . . 5 . 0 5 6 0 6 25 1 1 1 0 1 1 4 4 3 . . . 2 0 0 5 2 3 2 1 1 1 9 9 . . . 7 8 6 4 0 1 1 1 1 1 0 0 2 2 1 . . . 6 5 6 4 9 1 i i 9 9 9 7 6 7 . . . 0 2 0 0 5 0 : 1 1 1 0 0 0 1 1 .. . .8 8 1 9 9 0 5 5 1 1 . .5 1 6 2 j ! 9 1 9 00 .. . 2 1 6 2 i i 2 2 1 0 9 0 . . . 0 4 4 5 1 1 1 1 9 0 0 8 5 5 . . . 7 7 7 0 5 5 ! ! 2 2 0 0 . . 3 3 7 7 ; ; 1 1 0 0 0 0. . 3 3 4 4 October 4.98 102.33 19.80 102.59 : 94.25 99.00 48.00 j 93.20 19.34 100.21 19.87 ! 97.88 November • 4.90875 100.87 19.63 101.71 88.62 93.09 48.00 ! 93.20 18.80 97.41 17.87 ! 88.03 December 4.8925 100.53 19.57 101.40 ! 92.50 : 97.16 43.00 I 83.50 19.12 99.07 18.00 88.67 1915. , ! i January ! <l85375 99.74 19.35 ! 100.26 i 88.37 !• 92.83 43.50 ' 84.47 18.78 I 97.31 17.50 86.21 February i 4.8493 99.65 19.30 I 100.00 | 87.31 ! 91.71 44.87 87.13 18.52 j 95.96 17.35 85.47 March. .*. ! 4S,125 1.9.01 '. 98.50 ! 84.25 i 88.50 4-1.50 86.41 17.70 91.71 15.87 78.18 April 4 80 18.81 l 97.46 ! 82.87 ! 87.05 44.50 86.41 17.33 89.79 15.55 76.60 May • ••!.80 98.63 18.81 . 97.46 i 83.25 : 87.45 41.75 81.07 17.38 90.05 15.70 77.3-1 Juno i 47856 98.31 18.40 ' 95.34 ! 82.87 : 87.05 39.75 77.18 16.93 87.72 15.18 74.78 July "j -17.7125 98.01 18.07 ! 93.63 ! 82.25 ; 86.40 38.00 73.79" 16.50 85.49 15.18 74.78 August I 47.625 97.86 17.71 i 91.76 i 82.50 . 86.66 37.00 71.84 16.05 83.16 15.20 74.88 September • -17.3 97.20 17.35 89.90 I 81.25 ' 88.50 35.75 69.42 16.18 83.83 15.55 76.60 October ! i.725 97.09 17.35 89.90 ! 84.25 : 88.50 35.50 68.93 16.08 83.32 15.55 76.60 November j 4.71375 96.86 17.18 '• 89.02 ! 81.87 , 86.00 33.75 65.53 15.55 80.57 14.70 72.41 December \ !.74125 97.43 17.21 : 89.17 : i I ij. (O ! 83.77 32.75 63.59 15.35 79.53 14.10 69.46 1916. January 78 98.22 17.15 ! 88.86 ; 76.75*; 80.62 30.00 58.25 : 15.27 79.12 12.92 63.65 February... 76625 97.94 17.08 : 88.50 I 77.50 • 81.41 32.37 62.85 | 14.95 77.46 15.00 73.89 March 765 97.91 17.02 88.19 ; 73.37 ; 77.07 j 32.50 63.11 i 15.38 79.69 13.00 64.04 April 765 97.91 16.86 ! 87.36 ; 76.50 : 80.36 ; 32.00 62.14 i 15.85 82.12 13.62 67.09 May 7625 97.86 16.90 ,; 87.56 i 78.12 : 82.06 i 31.62 61.40 ! 16.13 83.58 13.50 66.50 June 75875 97.79 16.95 •. 87.82 | 77.12 : 81.01 ! 30.80 59.81 I 15.75 81.61 ! 13.25 65.27 July 75875 97.79 16.93 : 87.72 ! 74.50 78.26 | 30.80 59.81 i 15.68 81.24 | 12.80 63.05 A Se u p g t u e s m t ber. 7 7 5 6 8 7 7 5 5 9 9 7 7 . . 7 9 9 7 1 17 6 . . 1 9 3 8 I i 8 8 7 8 . . 9 7 8 6 i ; 7 7 0 2 . . 9 3 4 7 7 7 4 6 . . 5 0 2 2 ! j 3 3 4 3 . . 0 7 0 5 6 6 5 6 . . 5 0 3 2 ! j 1 1 5 5 . . 5 4 6 7 8 8 0 0 . . 1 6 6 2 i ! 1 1 2 2 . . 1 5 5 0 5 6 9 1 . .5 8 8 5 October 7569 97.75 17.13 ! 88.76 ! 70.56 : 74.12 i 31.75 61.65 15.47 80.16 i 12.00 59.11 November.. 7175 96.94 17.12 : 88.70 ! 70.19 : 73.73 ! 30.75 59.71 15.04 77.93 i 11.88 58.52 December.. 7569 97.75 17.14 ! 88.81 i 75.25 79.01 ! 30.75 59.71 15.02 77.82 I 13.40 66.01 1917. January.. 4.7585 97.78 17.12 I 8S.70 j 71.44 I 75.04 | 29.90 58.06 14.52 75.23 ! 11.79 58.08 February. 4.7580 97.77 17.11 ! 88.65 ! 70.87 . 74.44 I 29.10 56.50 14.12 73.16 ! 11.10 54.68 March 4.7555 97.72 17.12 ' 88.70 | 71.50 75.11 ! 28.60 55.53 13.11 67.93 ! 11.50 56.65 2. Rates on markets in neutral countries. Amsterdam Copenhagen Zurich Madrid Buenos Aires Rio de Janeiro (40.2=100). (20.8=100). I (19.3-100). (19.3=100). (42.45=100). (32.444=100). l_ 1914. •.Per cent. .Per cent. iPer cent.. Per cent. \Per cent.'- \Percenl. June §40.31 i 100.27 820.90 ! 100.37 §19.42 ; 100.62 I. July 41. 25 ' 102.61 27.50 ! 102.61 21.51 I 111.45 ;. August 42.00 104.48 : 27.50 | 102.61 September 41.75 103.86 :. 20.00 , 103.63 October.... 42.50 105. 72 ;. 19.88 ! 103.01 November 40.87 101.67 i 25.87 i 96.53 19.42 I 100.62 D ecember ±0.62 ! 101.04 : 25.25 ' 94.22 19.29 j 99.95 1915. i j anuary 40.50 J 100.75 i 25.00 I 93.28 19.14 j 99.17 19. 24 99.69 '. February... 40.31 j 100.27 , 24.81 I 92.57 18. 89 j 97. 88 19.49 100.98 . March 40.00 \ 99.50 25.50 i 95.15 18.69 96.84 19.78 102.49 :. April 39.50 ! 98.26 ; 25.75 96. 08 18.79 ' 97.36 20.05 i 103.89 ... May 39.56 j 98.41 : 25.95 , 96. 83 18.89 ' 97. 88 19.80 ! 102.59 . June 39.94 ! 99.35 : 26.42 98. 58 19.01 • 98. 50 19.08 ' 98.86 .. July 40.06 i 99.65 ' 26.35 ; 98.32 18.69 i 96.84 19.23 ! 99. 64 :. August 40.31 i 100.27 " 25.90 96. 64 18.83 i 97. 56 19.36 ! 100.31 :. September.. 40.37 i 100.42 i 25.95 ; 96. 83 19.05 ; 98.70 19.00 ' 98.45 41.55 i 97.88 : 23. 70 73. 06 October 41.50 i 103.23 ' 26.20 97. 76 19.01 98.50 19.05 : 98. 70 : 42.00 j 98.94 ; 20.81 73. 40 November.. 42.00 I 104.48 : 28.05 i 104..66 18. &J i 97.56 19.03 • 98.60 ' 41.75 ! 98.35 23. 75 73.21 December.. 43.50 j 108.21 28.00 ': 104.48 19.08 : 18.90 ; 97.93 : 42.00 ; 98.94 : 23. 62 72.81 1916. Januar y 45.87 111.10 j 27.90 i 104.10 19.49 i 100.98 19.12 ; 99.07 • 42.12 99.22 ; 23.50 72. U February... 42.62 106.02 28.25 j 105.41 19.31 i 100.05 19.25 i 99.74 ; 44.45 101.71 i 23.25 71.67 March./.... 42.75 106.34 29.00 ". 108.21 19.19 ! 99.43 19.37 I 100.36 i 42.62 100.40 ! 23.62 72.81 April 43.25 107.59 30.20 ! 112.69 19.31 ' 100.21 19.65 i 101.81 : 42.62 100.40 I 23.00 70.90 May 41.87 104.15 30.80 ! 114.93 19.31 100.05 19.95 i 103.37 I 42.32 99.69 ! 24.50 75.52 June 41.75 103.86 30.10 , 112.31 19.12 99.07 20.70 ' 107.25 I 42.25 99.53 24.50 75.52 July 41.44 103.08 29.10 ! 108.58 18.94 98.13 20.30.1 105.18 i 42.25 99.53 24.76 76.33 August 41.44 103.08 28.70 i 107.09 18.89 97.83 20.20 i 104.66 i 41.69 98.21 24.65 75.99 September . 11.12 102.29 27.75 : 103.54 18.89 97.88 20.16 ', 104.46 1 42.39 99.86 24.29 74.88 October 41.19 102.46 27.40 ; 102.24 19.01 9S.65 20.30 ! 105.18 i 43.15 101.65 24.10 74.29 November.. 41.00 101.99 27.15 I 101.31 19.34 100.21 20.55 i 106.48 ! 43.4.0 102.24 23.96 73.86 December.. 40.87 101.67 27.80 ! 103.73 20.28 105.08 21.25 | 110.10 I 44.89 105.75 23.63 72.84 j 1917. January.. 40.81 101.52 I 27.70 103.36 20.00 | 103.63 21.25 ! 110.10 ! 44.34 104.45 ! 23.57 72.66 February. 40.75 101.37 j 27.55 ! 102.80 20.00 : 103.63 21.35 I 110.62 i 44.46 104.73 ! 23.46 72.32 March..'.. -10.50 100.75 ! 29.60 i 110.45 19.91 I 103.32 21.75 • 112.69 ' 14.03 103.72 ! 23.18 71.45 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

406 FEDERAL RESERVE BULLETIN. MAY 1,1917. Movement of exchange rates {highest rates for sight drafts during month) on 'principal financial centers during 'period from June, 1914, to March, 1917—Continued. 3. Rates on market3 in silver countries. Average price for London 1913— Hongkong Shanghai p s r i i l c v e e r o . f c . e 6 n 04 ts 5 = 8 (47.10=100). (65.49=100). 100. 1914. Percent. Percent. Percent. June S46.90 99.45 $64.00 97.72 SO.56879 94.0& Julv 46.45 9S.49 64.00 97.72 .55201 91.30* August 47.85 101.46 64.75 98.87 September. .53159 87.93 October .50555 83.62 November .49630 82.09 December. ::;....i :;. .50145 82.94 1915. i i .49678 82.17 February . ...! .50007 82.71 March .51822 85.72 \pril. 44.70 94.78 57.00 87.04 .51925 85 89 May 44.60 94.57 57.00 87.04 .51706 85.52 June 44.30 93.94 56.50 86.27 . 51035 84.41 July 43.00 91.18 56.00 85.51 . 49556 81.97 August 42.70 90.54 56.00 85.51 .49973 82.66 September 43.75 92.77 56.00 85.51 . 51761 85.61 October 43.75 92.77 55.75 85.13 .52441 86.74 November 48.25 102.31 63.00 96.20 .54986 90.95 December 47.35 100.40 63.00 96.20 .57812 95.62 1916. January .. . 47. 60 100.93 63.87 97.53 . 59099 97.75 February • 46. SO 99.24 68.75 97. M . 59133 97.81 March 49. 50 104. 90 67.50 103.07 . 60496 100.06 April 56.50 119. 80 76.00 116.05 . 67215 111. 18 May 56.25 119.27 80.12 122.34 . 77989 129.00 June 51.00 108.14 72.00 109. 94 . 88088 112. 62 July 50 00 106.02 72.12 110.12 . 65632 108.56 August 51.75 109.73 73.50 112. 23 . 69040 114.19 S O e c p to te b m er ber . . . 5 5 3 2 . .7 4 5 5 1n1i3..s3s4 7 7 5 6 . .5 5 0 0 1 1 1 1 6 5 . . 2 8 8 1 . . 7 7 0 1 9 4 4 6 2 9 1 11 1 7 8 . . 3 2 4 1 November 56.00 I 118.74 87.50 133. 61 . 74852 123. 81 December 58.00 ! 122.99 89.00; 135.90 .79815 132.02 § 1917. January 58 00 i 122. 99 89.00 ! 135.90 .80412 February 58.00 1 122.99 89.50 136. 66 .82721 113363.. 0802 March 56.50 i 119.80 86.50 132. 08 .79844 132.07 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

EXCHANGE RATES OH BEIXIGEREHT COUNTRIES. \ 1 ifjt 7(IF tl9 tic W no JIQ JT HJ m IO$ -1 ")i 10$ RAi j / i • ! : 11 ; " I /04 JO2 h \M h 4 ^^ 1\ /N\ !V A S s L0N2CW \ \ 36 \ •/ \ \ 94- «&f f G& — 1 S \ \ V Of) - \ \ \ so n N \ >— / PARIS J&9 - \ i . / \ \ ss \ V m L i- *s>r _ l\\ \ \ / &*& 1 \ s / K \ \ *^ \ \ \ 1/ \ JVJ _ \ \ /l f X— eo \ V yf/ \ \ ?& - \ Ai/ \ ?8 . \} •i V) • > \ y \ N \ 1\ \ ^?*6 BERUIH \ P4 \ «w — \ H _• \ 1i \ PO - \ i i ?0 \I I : fiff _ \ \ "1" MILAN \ T: 1 / s L €6 \ "/ N • &4. - \ V \ \ 6* 1 s \ \ 02. \\ \T \ / \ ez / N \ \ / l \ J \ \ v/ i \ / \\ 60 1 AT& _ s. se 1 1 visniiA f&* - PETRO. J3MD G4. - S2 - sa SO - 1 so IBIS IB 16 \ /BJP 93720—17. (To face page 408.) No. 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1917. FEDERAL RESERVE BULLETIN. 407 DISCOUNT OPERATIONS OF THE FEDERAL RESERVE BANKS. Discount operations of the Federal Reserve month. Nearly 60 per cent of these small Banks during March totaled $26,706,266, com- bills, largely trade acceptances, are reported pared with $22,408,604 for February, 1917, by the Philadelphia bank. and $9,387,300 for March, 1916. Over 19 About 70 per cent of all the paper, including per cent of the discounts for the month is collateral notes, discounted during March was reported by the Boston bank, about 16 per 15-day paper, i. e., paper maturing within 15 cent by the Richmond bank, and over 15 per days from the date of discount with the Federal cent by the Cleveland bank. More than one- Reserve Banks; less than 9 per cent was 30-day half of the paper discounted by the Richmond paper; over 10 per cent 60-day paper, and bank, about 75 per cent of the paper discounted about 9 per cent 90-dsbj paper. Agricultural by the Boston bank, and an even larger pro- and live-stock paper maturing after 90 days portion of the paper discounted by the Cleve- from date of rediscount with the Federal Reland bank was 15-day paper, of which in turn serve Banks (six-month paper) figures only to a large proportion were member banks' collat- the extent of $532,279, or about 2 per cent in eral notes. The total of these notes discounted the total discounts for the month. During the during March was $10,327,229, or nearly 10 per three months ending March, 1917, the amount cent less than the month before. The amount of six-month paper discounted was $1,595,415, of trade acceptances (two-name paper) dis- compared with $3,724,500 for the first quarter counted during the month was $739,346, while of 1916 and $2,677,400 for the first quarter in the total of commodity paper, largely secured by 1915. cotton, was $870,753, compared with $299,000 On the last Friday in March the banks held of trade acceptances and $1,719,000 of com- a total of $20,106,200 of discounted paper, commodity paper discounted during March, 1916. pared with $20,267,200 about the close of Discounts for the three months of the February and $21,268,400 on the correspondpresent year aggregated $67,441,156, com- ing date in 1916. Of the total held about the pared with $28,166,900 for the corresponding close of the month under review, $3,400,000 period in 1916. Nearly two-thirds of the dis- were member banks7 collateral notes, $3,482,258 counts for the first three months of the present agricultural paper, $1,893,566 live-stock paper, year is represented by 15-day paper, handled and $11,330,358 industrial and commercial largely by the eastern and the Richmond banks. paper proper. Over one-half of the agricul- The total number of bills discounted during tural paper was held by the Richmond and March, exclusive of 79 collateral notes, was Atlanta banks, while about 80 per cent of all 4,284, averaging in size over $3,800, compared the live-stock paper was held by the Dallas with about $3,000 in February. Bills of the and Kansas City banks. largest size (i. e., in denominations of over Of the 7,625 banks reported at the end of $10,000), chiefly 15-day paper, constituted 52.6 March, only 315, or slightly over 4 per cent, per cent of the rediscounted paper, as against and 522, or about 7 per cent, availed themselves 41.5 per cent the month before, while medium- of their discount privileges during the month and size bills (in denominations of over $1,000 to the three months under review. The number $5,000) constituted but 24.6 per cent of the of member banks in the three Southern Federal paper rediscounted in March, as against 31.4 Reserve Districts rediscounting during the per cent in February. Small bills (in amounts month was 162 as against 290 in March, 1916. up to $250) constituted over 20 per cent of the Boston, New York, and Philadelphia are the number, though less than 1 per cent of the only banks which report a larger number of total amount of paper rediscounted during the rediscounting members than for March, 1916. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

408 FEDERAL RESERVE BULLETIN. MAY 1, 1917. Commercial paper discounted by each Federal Reserve Bank during March, 1917, distributed by sizes. NUMBER OF PIECES AND AMOUNTS. To §100. O to v e § r 2 S 5 l 0 O . O: j O to v e $ r 5 0 $2 0 5 . 0 O to v § e 1 r ,0 $ 0 5 0 0 . 0 j | O to v e § r 2 , 3 5 1 0 ,0 0 0 . 0 O to v e § r 5 , § 0 2 0 , 0 5 . 0 0 ; ! O to v 8 er 1 0 § ,0 5 0 ,0 0 0 . 0 Over 510,000. Total. Banks. o i c P e e n r t. '&i B B B \ ft B < I Boston 2, $160 1; $147| 16. 86,321 !6i 77; §157,319, 104! §489,960; 54 §526,209! 43 $25.,465,215! 329,^3,675,263, 22.4 New York 5. 400; 211 3,665 25! 10,018 13! 11,197' 27 53,192 31 132,500; 49; 377,588, 2,187,023 228; 2,775,583! 16.9 Philadelphia 381.19,721! 107;27,712 83 30,457 68! 51,647." 96i 191,725, HOi 459,147 '" ~~" ~~" 237,000| 959i 1,404,293. 8.6 Cleveland 3' 245! 6i 8051 4, 1,418 7j 5; 475; 16)940 30' 142;800! 30! 279,300! 52 l,970,637i 140: 2,417,620, 14.8 Richmond 24' 2,303 92116,654 172: 68, i— 222; 179,660! 239! 413,365; 1391 563,625 53 450,842! 22 423,405| 963! 2,118,552 12.9 Atlanta (including New Orleans branch) 4' 354 48i 7,770' 52: 19,628) 88 78,517 1151 190,351' 781 288,499; 49 355,473' 21 334,526! 455! 1,275,1181 7.8 Chicago T 757; 67,12,191 86: 35,4701 109! 86,634 104, 169,932: 40 167,569: 13! 124, OOOi 19 578,2481 445; 1,174,801 7.3 St. Louis 2: 200! 16 3,091, 37 14,039 20; 15,709 19: 32,048. 11! 44,920! 3 19,510, 3 38,0001 111| 167,517! 1.0 Minneapolis... ^ 9^ 1,568 22' 8,500| "" 25! 33,225 9 32,969;.... j 15,000! S3i 103,0911 0.6 Kansas City 10: 1,000! 16i 2999' 24! 8,915| 48! 34,599 33; 50,720' 18 67,628' 5 44,375i 110220, 2oc9w3 1i6«0n!l 332,529; 2.0 S D a a n ll a F s rancisco. 2. 131! 4 1 8 i 8, 2 0 0 7 7 3 : 63 4 ! , 65 1 , , 1 2 4 9 4 2 ! | 93 1 ; ! 25, 5 2 0 95 8 91 7 : : 14 1 1 1 , , 5 3 6 4 0 5 : 4 6 4 16 2 4 3 , , 8 5 1 7 8 3 1 31 4 ! 22 2 3 1 , , 5 0 1 8 9 0 ' 15 ' 23 1 7 0, , 8 2 0 9 0 5 3 2 8 4 7 8 6 6 8 5, , 8 8 6 0 5 5 ] ! 0 5 . . 4 3 Total ! 440:25,277; 492 84,8S2: 588269,900 718,530,9968411,461,722. 620,2,578,0381 334 2,808,780 251 8,619,442:4,284 16,379,037! Percent ; 0.2! ...! O.5.... 1.7....! 3.2 .... 8.9....: 15.7;.... 17.2;.... 52.6; I 100.0J100.0 MMbem ber bbka'n ks'lcollateral notes 2 10,000: 10! 81,500; 6710,235,729 79! 10,327,2291 Member banks' collateral notes, trade acceptances, and commodity paper discounted during the month of March, 1917, and 1916, and the three months ending March, 1917, and 1916. Collateral Trade Com- Collateral Trade Com- Banks. notes. a a c n c c e e p s t . - m pa o p d e it r y . Total. Banks. notes. a a c n c c e e p s t . - m pa o p d e it r y . Total. !_ Boston §1,423,500 §150,730 JS1,574,23O Minneapolis §100.000 i §25,263 §125,263 New York 287,000 I 287,000 Kansas City 5,000 5,000 Philadelphia 1,605,000 29,256 |1,634,256 Dallas 165,000 84, 775 169,775 Cleveland 1,600,000 ll, 600,000 San Francisco 12,048 12,048 Richmond 2,075,000 *14i,"466' §635,740 j 2,852,206 Atlanta (including New Total March, 1917... 10,327,229 ! 739,346 ! 870,753 11,946,328 Orieans branch) 266,000 388,355 227,190 j 881,545 Total March, 1916... ! 298,733 I 1,719,000 2,017,733 Chicago 1,130,729 1,130,729 Total Jan.-Mar.,1917. 31,277,920 2,169,888 i 3,258,512 36,706,320 St. Louis 1,670,000 ""4" 276' 11,674,276 Total Jan.-Mar.,1916. 989,233 5,377,263 6,366,496 Amounts of discounted paper, including member banks' collateral notes, held by each Federal Reserve Bank on the last Friday in March, 1917, distributed by classes. Banks. A p t g a u r p r ic e a u l r. l- p L s a t i o p v c e e k r - . i C n c p d o ia a m u l p s m a e tr n r e i . d a r- l c M o n b l e o a la m t n e t k e b s s r . e a r l Total. Banks. A p t g a u r p r ic e a u l r. l- p L s a t i o p v c e e k r - . i C n c p d o ia a m u l p s m a e tr n r e i . d a r- l c M o n b l e o a la m t n e t k e b s s r . e a r l Total. Boston §3,453,240 §715,000 §4,168,240 St. Louis §120,337 §59,045 §82,593 SI, 275,000 §1,536,975 New York §56,683 §6,190 . 636,075 169,000 867,948 Minneapolis 380,096 192,977 425,707 998,780 Philadelphia 85,595 1,001,614 1,087,209 Kansas City 167,513 447,184 15,031 5,000 634,728 Cleveland 18,019 "*"8,"986" 1,023,660 500,000 1,550,665 Dallas 254,802 1,054,582 233,305 100,000 1,642,689 Richmond 778,916 2,060 2,553,644 420,000 3,754,620 San Francisco... 97,970 18,492 157,655 274,117 Atlanta 1,028,393 75,620 867,426 151,000 2,122,439 Chicago 493,934 28,430 880,408 65,000 1,467,772 Total 3,482,258 1,893,566 11,330,358 3,400,000 20,106,182 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY l, 10.17 FEDERAL RESERVE BULLETIN. 409 Commercial paper discounted during the three months ending March, 1917, by each Federal Reserve Bank, distributed by States and maturities as of date of discount. Number Maturities. Number of of banks Total Districts and States. o m f a b e t a M m n e a n k b r d s e c r h. m q a e d o c u n u c d a d r o a r i i n m t n t e e g g r - d 1 W 5 i d t a h y in s. 1 F 6 d a r t o y o m s. 30 31 F d a r t o o y m s. 60 p c c a o o p m u c e n i r m a t l e d e d i r s - . - Mar. 31. District No. 1—Boston: Connecticut 350,382 : Sill, 790 ! §241,932 Maine 66 • Massachusetts 157 21 6,356,069 1,291,688 j 1,040,994 New Hampshire 3 i 85,000 i 48,230 Rhode Island 17 1 ' i 15,000 Vermont 48 3 ! 55,349 I 12,313 I 56,660 Total. 399 31 ! 6,546,800 \ 1,415,791 | 1,402,816 District No. 2—New York: Connecticut 15 : 3 75,200 I 16,500 27,300 New Jersey 132 7 31,848 I 61,366 54,101 New York 478 • 20 4,476,128 •• 37,085 370,702 Total. 025 30 | 4,583,176 : 114,951 | 452,103 430,451 j 5,415 | 5,586,096 District No. 3—Philadelphia: Delaware 24 New Jersey 72 5 i 22,927 i 144,686 298,495 j 44,973 511,081 Pennsylvania 536 24 , 4,042,009 j 255,226 354,205 i 86,170 | 7,286 j 4,745,556 Total. 632 29 j 4,065,596 j 399,912 652,700 | 131,143 I 7,286 j 5,250,637 District No. 4—Cleveland: Kentucky 68 l !, 475 1,321 ; J j 1,796 Ohio 373 I 6,097,854 853,787 173,546 ! 59,406 | 13,545 I 7,198,138 Pennsylvania 299 5,000 I | I 5,000 West Virginia 13 j. I i ' • - Total. 753 14 ; 6,097,854 I 854,262 179,867 I 59,406 | 13,545 ! 7,204,934 District No. 5—Richmond: District of Columbia... 15 200,000 13,912 83,267 i 151,772 j | 448,951 Maryland 96 9 1,285,000 32,984 181,051 j 132)602 I ! 631,637 N So o u r t t h h C C a a r r o o l l i i n n a a 8 8 1 0 4 2 0 9 1,0 3 0 2 9 4 , , 0 2 4 6 0 8 6 51 8 5 6 , , 9 0 7 9 4 2 1 L , , * 5 33 0 W 5 , 7 , , U 9 8 V 6 4 J 8 O 6 | 1 w ,0 7 5 8 6 3 , , 2 5 6 3 7 9 I 8 1 9 , , 7 8 7 8 5 2 I ! 2 3 , , 8 4 7 9 8 2 , , 1 4 7 9 4 7 Virginia 144 16 9,981,000 66,395 94,432 I 90,695 1,565 i 10,234.087 West Virginia 102 3o ,9f\0r\0n ' 3,900 Total. 518 98 12,859,328 1,186,277 2,206,4(54 i 2,214,875 93,222 ! 18,560,166 District No. 6—Atlanta: Alabama 93 ; 329,669 37,977 192,209 | 452,135 22,605 1,034,605 Florida 55; 775,639 46,420 73,874 I 63,420 5,250 364,603 L G o e u o i r s g i i a a na 1 2 0 2 2 ! j 5 6 2 1 8 3 , , 1 3 2 5 5 0 2 4 6 0 9 , , 5 2 6 4 7 3 6 P 3 1 OO 5 5 , , , 5 5 UO 7 3 A 9 2 i ; j 3 9 3t7 0 4 0i. 8 2 f8i , , , 7 7 4 66 0 I\J00 0 \J | 3 1 5 0 , , 7 2 4 2 9 9 2,4 9 4 8 1 8 , , 0 4 4 8 9 5 Mississippi 18 s 50,000 50,000 Tennessee 92 ! 100,100 37,873 j 91,852 j 139,860 j 37,789 407,474 Total. 382 79 I 1,796,883 j 432,080 j 1.009,046 1, 111,622 j 5,256,216 District No. 7—Chicago: Illinois I... 316 270,517 725,837 l 335,395 23,804 1,446,871 Indiana 195 1,018 19,061 i 49,142 48,413 148,867 I owa 354 21,480 46,706 I 62,808 69,247 236,195 Michigan 76 3,546,160 117,934 ! 62,584 15,000 3,746,678 Wisconsin 105 5,000 i 2,100 6,443 59,278 Total 1,046 ! 59 3,839,175| 914,538| 512,027 | 209,242; 162,907 > 5,637,889 District No. 8—St. Louis: Arkansas 67 i 909,377 3,044 ! 15,392 8,107 i7,i; 953,461 Illinois 157 I 3,798 2,998 ! 25,159 15,768 5,000 : 52,723 Indiana 61 ;. Kentucky 65 !. Mississippi is ; 40,000 i 1,000 ; 8,000 i 18,100 i i 67,100 Missouri 1,125,000 ; 11,119 ', 35,366 | 96,848 i 32,685 '. 1,301,018 Tennessee SO ; 385,099 ! 150,967 j 101,706 i I ! 637,772 20 . Total. 31 I 2,461,974 j 168,378 . 187,673 i 138,823 | 55,226 • 3,012,074 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

410 FEDERAL RESERVE BULLETIN." MAY 1, 19 IT. Commercial paper discounted during the three months ending March, 1917, by each Federal Reserve Bank, distributed by States and maturities as of date of discount—Continued. Number Maturities. Number i of of i banks i Total Districts and Sta,tes. o m f a b e t a M m n e a n k b r d s e c r h. m q a e d o c u n u c d a d r o a r i i n m t n t e e g g r - d 1 W 5 i d t a h y in s , ; i 1 F 6 r t o o m 30 31 F r t o o m 60 61 F d a r t o o y m s. 90 90 A d ft a e y r s, | ! j j p c c a o o p m u c e n i r m a t d l e e i d r s - . - !Mar. 31. d District No. 9—Minneapolis: Michigan , 32 | $2,081 I $2,388 i $17,505 83,289 i. $25,263 Minnesota , 289 ! 1,014,028 ! 569,929 i 1,064,107 160,625 i $86,050 2,894,739 North Dakota 156 i 35,000 ! 14,525 | 18,061 44,490 i 24,302 136,378 South Dakota 125 I 1,998 | 26,550 20,118 i 70,625 119,291 Montana 86 ! 14,295 8,787 j 18,788 41,870 Wisconsin , 37 i 5,000 j. 1,401 6,401- Total 725 ! 44 1,056,109 j 588,840 \ 1,141,919 237,309 ! 199,765 j 3,223,942 District No. 10—Kansas City: Colorado 122 I 1,621 439 i 1,768 I Kansas 224 j 60,223 , 139,102 j 28,742 977 | 58,280 i 293,324 Missouri 54 i 606 ! 1,282 j 4,552 28,225 ! 43,073 Nebraska 192 ; 2;952 j 10,464 606 i 8,258 i 52,080 New Mexico 9 , 6 252 13,877 i 20.129 Oklahoma 303 ! 85,000 ! 20,199 ! 56,431 51,367 135,970 ' 348,967 Wyoming 36 I i_ Total 940 i 32 145,829 ! 163,535 | 101,610 105,049 | 246,378 I 762,401 District No. ll~Dallas: Arizona Louisiana 12 j T New Mexico 28 ; 43.810 92,485 | 27,517 I 137,573 i 301,385 Oklahoma 32 ! 1,373 i 3,230 ! 4,601 Texas 541 | 662,016; 71,142 433,232 | 454,250 ! 485,011 j 2,105,651 Total 619 I 56 | 662,016 j 114,952 | 527,090 | 481,767 625,814 j 2,411,6 . District No. 12—San Francisco: ! Alaska i! Arizona 6! California 263 1 13 5,445 22,129 71,014 69,057 43,895 j 211,540 Idaho 57 1 3 3,578 20,941 26,700 ] 51,219 Nevada , 10 ! Oregon 81 : 3 25,000 2,890 4,660 3,640 I 36,190 Utah 23 ! Washington 77 , ! ::::::::: i Total 518 ! 19 30,445 | 25,707 73,904. 94,658 74,235 | 298,949 i i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 3 917. FEDERAL RESERVE BULLETIN. 411 Commercial paper discounted by each Federal Reserve Bank during the three months ending March, 1917, distributed bu maturities as of dale of discount—Continued. RECAPITULA TION. ; Number Maturities. Districts and cities. i ; ; ! ! a m t b M e e a o a n m n f r d k c b s h e o . , r f i m N o q a d f u o u c u c a d m b r o r a i a b t n m t n e e e g k - r d r . s • W d it a h y in s . 15 F 3 r 0 o m d a 1 y 6 s . to F 6 ro 0 m da 3 y 1 s t . o j ; F 9 r 0 o m da 6 y 1 s . to! A d ft a e y r s 9 . 0 T p c o a m o p t u a e e l n r r i t c e e d a o d i l m s . - - Per cent. No. 1—Boston ! 31 $6,546,800 ;!51,415.791 81,402,816 3864,806 $10,230,213 15.2 No. 2—New York 625 30 4,583,176 -: 114,951 452,103 430,451 $5,415 5,586,096 8.3 No. 3—Philadelphia •: 632 29 4,065,596 | 399,912 652,700 131,143 7,286 5,256,637 7.8 No. 4—Cleveland : 753 14 6,097,854 i 854,262 179,867 59,406 13.545 7,204,934 10.7 No. 5—Richmond 518 98 12,859,328 i 1,186,277 2,206,464 2,214,875 93', 222 18,560,166 27.5 No. 6—Atlanta ! 382 79 1,796,883 ' 432,080 1,009,046 1,906,585 111,622 5,256,216 7.8 No. 7—Chicago ' 1.046 59 3,839,175 914,538 512,027 209,242 162,907 5,637,889 8.3 No. 8—St. Louis : 468 31 2,461,974 168,378 187,673 138,823 55,226 3,012,074 4.5 No. 9—Minneapolis ! 725 44 1,056,109 588,840 1,141,919 237,309 199,765 3,223,942 4.8 No. 10—Kansas City i 940 32 145,829 163,535 101,610 105,049 246,378 762,401 1.1 No. 11—Dallas j 619 56 662,016 114,952 527,090 481,767 625,814 2,411,639 3.6 No. 12—San Francisco j 518 19 30,445 25,707 73,904 94,658 74,235 298,949 .4 Total for 3 months ending March, j 1917 :. 7,625 522 44,1455,,118855 j 6,379,223 8,447,219 6,874,114 | 1,595,415 67,441,156 Per cent i 66555.5 j 99.44 12.5 10.2 i 2.4 100.0 Total for 3 months ending March, 1916 4,425,100 9,094,300 10,922,900 3,724,500 | 28,166,800 Total for 3 months ending March, 1915 8,865,400 14,306,100 10,793,900 2,677,400 I 36,642,800 Distribution, by sizes, of bills bought in open market by all Federal Reserve Banks during March, 1917, and the three months ending March, 1917 and 1916. I To f>5,000. To $10,000. To 825,000. To .¥50,000. ! To S100,000. Over §100,000. Total. ! Acceptances bought in open market* 1 a> 8 8 ! S Bankers' accept- 369 $823,228! 154 51,218,636 348 $6,756,3361 164 $r, 914,0481 8&§6,801,912 25 $4,930,660 l,146:i $27,474,8201 97.6 Trade acceptances. 20 53,278; 21 162,393 is o2o2n0, 0rw7r0v: n 02.4111 ,0A7777;:. *I 63! a 676,818| 2.4 Total, March, i 1917 1 876,506| 175 1,381,029 303 6,976,406; 171 7,185,125! 86; 6,801,912 25; 4,930,660 1,209 28,151,638 Percent. 3.11...... 4.9 ' 24.2 ...I 17.5 100.0 February, 1917 i 819 2,175,639| 777! 6,324,018 1,248 22,367,962! 40116,483,974| 180J15,273,481 491 8,012,105 3,474 70,637,179! January, 1917 j 390 1,023,210! 483 1,706,069 300 5,238,200! 152 6,898,4121] 13,891,515 11! 1,859,768 1,384| 20,617,180! Total, 3 months j I | ending March, j 1917. 4,075 355| 1,435 9,411,316 1,91134,582,574J 724 30,567,511; 314:25,966,908; 8514,802,533 6,007; 119,405,997| Total, 3 months i ending March, i 1916 .'.I 749 2,278,542| 013! 5.012,301 7G9 14,240,484: 205 8,227,999! 100 8,072,470 37| 7,105,5 2,473i 44,937.394 * Of the above amount, bankers' acceptances totaling 821,621,188 were based on imports and exports and 85,853,632 on domestic trade transactions. 2 Of the above amount, trade acceptances totaling $671,418 were drawn abroad on importers in the United States and 85,400 were based on domestic trade transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

412 FEDERAL RESERVE BULLETIN. MAYI, 3917. ACCEPTANCES. Acceptances bought in open market and held by Federal Reserve Banks as per schedules on file with the Federal Reserve Board on dates specified, distributed by classes of accepting institutions. Bankers' acceptances. Trade ac- Date. M ba e n m k b s e . r c N o b m o e n r p m t a r n e u m i s e t s - . N be b o r a n n S m k t e a s n . te - P b r a i n v k a s te . a b F n r b o a d n a r a e n c g i h k g e e n n s - Total. b c m e o p o u a t p g r a k e h n n e t c t e i . n s c T ep o t t a a n l c a e c s - . cies. 1915. Feb. 22 •193,000 893,000 893,000 Apr. 5 3,653,000 820,000 $10,000 S110,000 . 11,593,000 11,593,000 May 3 5,038,000 189,000 10,000 110,000 . 13,347,000 13,347,000 June 7 5,242,000 516,000 10,000 192,000 . 9,960,000 9,960.000 July 3 4,342,000 267,000 161,000 . 9,770,000 i 9,770,000 Aug. 2 5,350,000 407,COO ""20*666 352,000 .: 11,129,000 11,129,000 Sept. 6 6,087,000 305,000 20,000 472,000 . 12,884,000 12,884,000 Oct. 4 9,000,000 898,000 132,000 343,000 .: 14,373,000 1 14,373,000 Nov. 1 : 8,477,000 331,000 253,000 204,000 .1 13,265,000 13,265,000 Dec. 6 12,311,000 172,000 275,000 396,000 .! 18,154,000 18,154,000 1916. Jan. 3... 15,494,000 7,160,000 362,000 822,000 ! 23,838,000 23,838,000 Feb. 7.. 15; 681,000 I 7,876,000 336,000 1,456,000 ; 25,349,000 S489,000 25,838,000 Mar. 6.. 17,182,000 i 8,670,000 408,000 1,781,000 ! 28,041,000 I 462,000 28,503,000 Apr. 3.. 21,000,000 | 13,573,000 473,000 3,262,000 j 38,308,000 722,000 39,030,000 May 1.. 24,875,000 i 15,400,000 585,000 3,430,000 1 44,290,000 1,477,000 45,767,000 June 5.. 24,680,000 17,029,000 644,000 7,007,000 49,360,000 2,208,000 51,568,000 July 3.. 32,989,000 j 18,921,000 471,000 11,830,000 64,211,000 3,422,000 67,633,000 Aug. 7.. 39,695,000 ! 19,060,000 738,000 13,940,000 73,483,000 4,225,000 77,658,000 Sept. 4.. 41,413,000 20,356,000 726,000 12,491,000 ! 74,986,000 3,673,000 78,659,000 Oct. 2.. 37,798,000 21,782,000 712,000 9,944,000 , ! 70,236,000 2,306,000 72,542,000 Nov. 6.. 37,770,000 29,474,000 1,014,000 12,147,000 , I 80,405,000 2,378,000 82,78-3 000 Dec. 4.. 47,748,000 33,232,000 1,630,000 16,069,000 I 98,679,000 4,487,000 103,166,000 I 1917. Jan. 1 i 66,803,000 34,625,000 1,502,000 18,224,000 il21,154,000 4,585,000 125,739,000 Jan. 8 i 60,066,000 32,467,000 1,325,000 16,915,000 , 1110,773,000 4,249,000 115,022,000 Jan. 15 j 59,710,000 30,691,000 1,245,000 15,862,000 , 1107,508,000 4,386,000 111,894,000 Jan. 22 ! 56,334,000 26,286,000 1,146,000 14,119,000 , i 97,885,000 4,102,000 101,987,000 Jan. 29 j 52,439,000 22,744,000 1,054,000 12,949,000 89,186,000 4,041,000 93,227,000 Feb. 5 i 50,361,000 23,511,000 972,000 13,775,000 §140,000 88,759,000 4,041,000 92,800,000 Feb. 12 i 54,945,000 33,473,000 1,265,000 17,952,000 668,000 1108,303,000 4,896,000 113,199,000 Feb. 19 ! 59,165,000 35,745,000 1,268,000 21,842,000 677,000 '118,697,000 4,982,000 123,679,000 Feb. 26 ! 59,498,000 36,478,000 1,094,000 20,389,000 677,000 1118,136,000 5,068,000 123,204,000 Mar. 5 i 53,288,000 32,518,000 1,090,000 20,581,000 354,000 107,837.000 2,535,000 110,366,000 Mar. 12 i 50,130,000 28,769,000 845,000 19,503,000 296,000 99,543,000 2,359,000 101,902,000 Mar. 19 \ 46,171,000 24,175,000 735,000 17,607,000 22S, 000 88,916,000 1,908,000 90,824,000 Mar. 26 ! 43,471,000 22,525,000 645,000 17,515,000 167,000 84,323,000 1,295,000 85,618,000 Apr. 2 ! 43,979,000 20,328,000 689,000 16,830,000 200,000 82,026,000 1,144,000 83,170,000 Apr. 9 '•• 42,264,000 19,424,000 681,000 15,427,000 200,000 77,996,000 1,344,000 79,340,000 Apr. 16 ,' 38,865,000 15,708,000 638,000 14,470,000 200,000 69,881,000 1,316,000 71,197,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1017 FEDERAL RESERVE BULLETIN". 413 Amounts of paper discounted and acceptances and warrants bought by each Federal Reserve Bank during March, 1917, distributed by maturities. 15-day maturities. 30-day maturities. Federal Reserve Banks. co D u i n s- t s. I j . A a c n c c e e p s. t- r W an a t r s - . Total. oo D u i n s- t s. j j A a c n c c e e p s. t- Total. Boston S3,810,628 , I I !$3,816,628 §298,485 1.826,891 125,376 New York 2, SOL, 099 86,206 j ! 2,807,305 23.139 248,614 271,753 Philadelphia 2,667,902 ! .' 2,667,902 74' 442 987,128 061,570 Cleveland 3,416,237 ! 3,416.237 572,856 142,365 715,221 Richmond 2,136,837 136;837 430,766 2,184,237 615,003 Atlanta (including New Orleans branch) 448,953 78,015 i 526,968 108,269 541,52 i. 649,793 Chicago 1,391,246 391,246 552,993 1,363,796 916,789 St. Louis 1J670J566 ! i 1)670,566 8,061 192.109 200,170 Minneapolis 102,081 ! i 102,081 13,024 650', 000 663,024 Kansas City 60,223 ! ! 60,223 142,747 70,390 213,137 Dallas 182,88(5 i I 182,886 87,179 87,179 San Francisco 8,578 259,014 267,592 Total. 13,694,658 81,221 18,778,879 2,320,539 8,466,068 10,786,607 Percent 33.6 19.3 60-day maturities. 90-day maturities. Federal Reserve Banks. co D u i n s- ts. A a c n c c e e p s t . - r W an a t r s - . Total. co D u i n s- ts. A a c n c c e e p s t . - r W an a t r s - , I j Total. Boston I $574,161 31,179,264 753,425 3409,489 52,151, '82,560,596 New York ! 144,973 220,115 365,088 92.305 1,288, ! 1,380,781 Philadelphia ! 234,570 820,693 055,203 30J769 2,585, ! 2,616,577 Cleveland ! 9,249 156,010 165,259 16,611 694, ! 711,023 Richmond ! 830,918 634,487 465,405 760,054 835, ! 1,595', 204 Atlanta (including New Orleans branch) i 352,060 741,415 093,475 590,678 671, i 1,261,801 Chicago i 147,414 433,004 580,418 141,887 1,320, $5,125 j 1,467,147 St. Louis i 71,133 226,026 297,150 60,705 ' 183, I 244,175 Minneapolis ! 41,997 850,000 891,997 20,193 1,202, ! 1,223,154 Kansas City j 39,378 39,378 35,190 75, ! 110,190 Dallas.....' i 314,122 314,122 202,637 44, I 247,095 San Francisco ; 13,630 472,308 485,938 24,007 694, I 718,619 T ot al : 2,773,605 5,733,322 i S, 506,927 2,385,185 11,746,055 5,125 14,136,365 Per cent '. •' 15. 2 ! 25.3 Over 90-day maturities. Totals. Per cent. Federal Reserve Banks. Dis- Accept- War- Dis- i Accept- Warcounts. ances. rants. Total. counts. i ances. rants. Total. Total. Boston >5,098,763 185,157,262 S10,256,025 49. 8 50. 2 i.... 100.0 New York SI, 067 ! $1,067 3,062,583 I 1,763,414 4,825,997 83.5 36.5 ! 100.0 Philadelphia 1,610 S216,667 82,575 ! 220,852 3,009,293 I 4,610,296 82,575 7, (522,164 39. 4 60.3 i 0.3 100.0 Cleveland 2,667 44,935 1,023,323 il, 070,925 4,017,620 i 1,037,722 1,023,323 6,073,665 66.1 17.1 1 16.8 100.0 Richmond 34,977 | 34,977 4,193,552 ! 3,653,874 7, 847, 426 53.4 46.6 i 100.0 Atlanta (including New Orleans branch) 41,158 41,158 1,541,118 2,032,077 3,573,195 43.1 56.9 100. a Chicago 71,990 43,200 115,190 2,305,530 3,160,135 5,125 5,470,790 42.2 57.7 100.0 St. Louis 26,992 26,992 1,837,517 601,545 2,439,062 75.3 24.7 100.0 Minneapolis , 25,796 25,796 203,091 2,702,961 2,906,052 6.9 93.1 100.0 Kansas Citv 59,991 59,991 337,529 145,390 482,9 L9 69.8 30.2 LOO. 0 Dallas ; 244,041 ! 244,041 1,030,865 44; 458 1,075,323 95.9 4.1 100.0 San Francisco 21,990 1,817,170 (1,839,160 68,805 3.242,504 3,311,309 2.1 97.9 100.0 Total. 532,279 2,121,972 1,025,898 13,680,149 26,706,266 28.151 1,031,023 55,888.927 47.8 ; 50.3 1.9 100.0 Per cent ! 6.6 ..'.... i.00.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

414 FEDERAL RESERVE BULLETIN. 1, KM 7. Maturities of discounted bills, acceptances, and municipal warrants held by the Federal Reserve Banks on Friday. Mar. SO, 1917. [In thousands of dollars, i. e., 000's omitted.] 1 to 15 days. 31 to 60 days. 61 to 90 days. Mu- Banks. ! Bills j Ac- Bills Ac- nic- ! ; c d ou is n - t - | i e a e n p ce t- s Total. co d u is n - t- a c n e c p e t- s w ip a a r l - Total. ed. ! bought. ed. bought.rants. i j Boston ' 3,152 | 4,723 55 1,763 ! 127 1,945 New York ' 360 I 7,783 42 1,174 I4,663 5,879 Philadelphia I 787 ! 3,273 18 2,580 ! 1,267 3,865 Cleveland I 1,198 j 1,702 16 607 !1,827 2,250 Richmond j 1,429 | 2,920 334 125 ! 459 Atlanta i 645 | 1,917 431 461 894 Chicago i 934 i 2,139 120 1,151 3,254 S M t. i n L n o e u ap is o lis : ; 1,3 3 1 4 7 4 i ; 2 1 , ,2 0 6 6 0 0 1 7 5 1 3 2 1 2 5 5 8 7 1 8 5 2 2 1,0 5 1 3 1 0 Kansas City : 138 I 1,026 76 75 380 531 Dallas ".! 358 I 1,176 257 44 411 712 San Francisco ! 28 i 1,120 81 1,716 558 2,355 Total 110,690 ! 20,371 31,099 1,654 10,079 111,952 23,685 Per cent I ! 25.8 19.7 Over 90 days Total. Percentages. Banks. c B d o e i i u d l s l n . - s t- a c A n e c p c e t - - s ir£ i n M ; m i ^ c u s :i - ' - Total. Am di o s u c B o n i u t l . l n s t c e P e d e n . r t. Am Ac o b c u o e n u p t g t . a h n c t c P . e e e n s r t. Am M w ou a u n r n r t i a . c n ip c t P s a e . l e n r t. Amou T n o t t , a ^ l. j. c B d o e i i u d l s l n . - s t- b a c o A n e u c p c g e t - h - s t. r w a n M ip n i a c a u t r - s l - - . Total. Boston 4,168 20.7 13,146 15.6 298 ! 1.9 17,612 i 14.6 23.7 1.6 74.7 100.0 New York.. . 316 316 868 4.3 18,913 22.4 5,199 I 33.1 24,980 '' 20.8 3.5 75.7 20.8 100.0 Philadelphia... 3 6 1,087 5.4 11,117 13.2 1,378 ; 8.8 13,582 : 11.3 8.0 81.9 10.1 . 100.0 Cleveland 7 1,238 1,245 1,551 7.7 5,212 6.2 3,066 ! 19.5 9,829 8.2 15.8 53.0 31.2 100.0 Richmond 85 15 100 3,754 18.7 6,376 7.5 15 ! 0.1 10,145 i 8.4 37.0 62. 9 0.1 100.0 Atlanta. . . 75 75 2,123 10.6 3,584 4.2 7 i .0 5,714 i 4.7 37.2 62.7 0.1 100.0 Chicago 70 1 153 223 1,467 7.3 8,002 9.5 2,653 ! 16.9 12,122 ! 10.0 12.1 66.0 21.9 100.0 St. Louis 27 j 212 239 1,537 . 7.6 3,936 4.7 1,094 ! 7.0 6,567 !• 5.5 23.4 59.9 16.7 100.0 Minneapolis... 91 91 999 4.9 4,129 4.8 177 I 1.0 5,305 i 4.4 18.8 77.8 3.4 100.0 Kansas City... 141 51 192 635 3.2 2,228 2.6 486 3.1 3,349 ; 2.8 19.0 06. 5 14.5 100.0 Dallas 272 20 292 1,643 8.2 1,441 1.7 506 3.2 3,590 : 3.1 45.7 40.1 14.2 100.0 San Francisco. 54 203 257 274 1.4 6,389 7.6 836 5.4 7,499 6.2 3.7 85.2 11.1 100.0 Total 825 ! 2,211 3,036 20,106 100.0 84,473 100.0 15,715 100.0 120,294 : 100.0 16.7 70.2 13.1 | 100.0 Pjer cent 2.6 100 0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1,1917. FEDERAL RESERVE BULLETIN. 415 Total investment operations of each Federal Reserve Bank during the month of March, 1917 and 1916, and the three months ending March, 1917 and 1916. Bills Bills bought in open market. Municipal warrants bought. discounted Federal Reserve Banks. for m b e a m nk b s e . r Bankers' a T c r c a e d p e t- I ! Total, City. State. All other. Total. ances. Boston 85,098,763 85,157,262 ...j $5,157,262 i New York 3,062,583 1,763,414 ...I 1,763,414 I Philadelphia 3,009,293 4,610,296 4,610,296 I 32,575 $2,575 Cleveland 4,017,620 1,037,722 1,037,722 1,018,808 84,515 1,023,323 Richmond ; 4,193,552 3,653,874 3,653,874 Atlanta (including New Orleans branch) 1,541,118 2,026,077 $5,400 2,032,077 ! Chicago 2,305,530 3,160,135 3,160,135 j .| 5,125 5,125 St. Louis 1,837,517 601,545 601,545 ! Minneapolis 203,091 2,702,961 I 2,702,961 i Kansas City 337,529 145,390 ! 145,390 i Dallas 1,030,865 44,458 | 44,458 ! San Francisco 68,805 2,571,086 671,418 i 3,242,504 • Total, March, 1917 26,706,266 ! 27,474,820 676,818 i 28,151,638 i 1,021,383 9,640 1,031,023 Total, March, 1916 9,387,300 ! 22,394,100 552244,,000000 II 2222,,991188,,110000 II 1100,,440088,,000000 •"S9,"266"| 8,700 10,425,900 Total, 3 months ending March, 1917., 67,441,156 116,841,651 2,556644,334455 111199,440055,999977 ii 1144,002211,996688 2,040 ' 590,177 14,614,185 Total, 3 months ending March, 1916.. 28,166,900 43,742,400 1,195,000 ! 44,937,400 | 30,309,100 265,600 i 82,400 30,657,100 United States bonds and Treasury notes. Total investment operations. Federal Reserve Banks. 2 per cent. .; 3 per cent. 4 per cent. ! | j C o e e fi r d n t n i d f e i e c s b a s. t t - e s j | l-yearnotes. Total. M 1 a 9 r 1 c 7 h . , M 1 a 9 r 1 c 6 h . , M 1 a 9 r 1 c 7 h . , : M 19 a 1 rc 6 h . , I Per ct. ,Per ct. Boston... 81,057,750 ! $3,000,000 | ij $84,,005577,7,7500 814,313,775 ! S7,295,400 12.5 ; 14.3 New York 2,440,000 I 20,000,000 SI, 532,000 i 24,022,000 28,847,997 ' 15,267,200 25.2: 29.9 Philadelphia. j 1,098,260 i §50,000 3,500,000 ! 4,598,260 12,220,424 ! 6,542,700 10.6 ! 12.8 Cleveland j ! 3,500,000 3,500,000 9,578,665 i 2,854,100 8.4 : 5.6 Richmond ; 710,500 ! 2,000,000 2,710,500 10,557,926 \ 3,621,900 9.2 ; 7.2 Atlanta (including New Or- J i leans branch) j 120,000 I 1,500,000 350,000 j 1,970,000 5,543,195 i 3,384,800 4.8 j 6.7 Chicago i 1,461,500 j 5,000,000 6,461,500 11,932,290 i 3,153,200 10.5 ! 6.2 St. Louis ; 2,500,000 2,500,000 4,939,062 i 1,313,800 4.3 : 2.6 Minneapolis 20,010 ! $25,000 00>> 45,010 2,951,062 I 1,489,700 2.6 •. 2.9 D K Sa a a n l n l s a F a s r s a n C c i i t s y c o 1,0 5 9 6 4 2 , , 7 7 4 5 0 0 • | ' 2 2 2 , , , 5 0 5 0 0 0 0 0 0 , , , 0 0 0 0 0 0 0 0 0 I 3 2 2 , , , 5 6 5 9 6 0 4 2 0 , , , 7 7 0 4 5 0 0 0 0 4 3 5 , , , 0 8 6 7 1 3 7 1 8 , , , 6 3 0 5 0 7 9 9 3 i ! j 3 1 1 , , , 3 4 2 1 7 6 7 7 3 , , , 5 0 8 0 0 5 0 0 0 3 3 5 . . . 6 2 1 ! j 6 2 2 . . . 4 9 5 Total, March, 1917 8,565,510 : 50,000 ! 25,000 48,000,000 1,882,000 58,522,510 114,411,437 i ! i T T o o t t a a l l , , M 3 a m rc o h n , t 1 h 9 s 1 6 e nd- i 7,400,850 ! ' 766,000 | 83,000 8,249,850 i 50,981,150 j 100.0 ! 100.0 ing March, 1917 i 11,080,160 ; 111,440 i 25,250 48,000,000 2,338,000 61,554,850 Total, 3 months end- ' I ing March, 1916 i 18,576,900 ] 2,908,880 2,888,000 I 24,373,780 i Certificates of indebtedness amounting to $2,000,000 received on Apr. 2. Conversion operations of each Federal Reserve Bank for April, 1917, total conversions^ since the beginning of the present calerudar year, and the balance of allotments made by the Federal Reserve Board which may be converted in 1917. Federal Reserve Bank. 2-per cent b A on p d r s . 1 c . onverted on Co b T n a r v n e e a k r s s s u i o o r n n y A n b p o o t r n e . d s 1 s * . i ss a u n e d d t 1 o - y t e h a e r | i J c a T o n n o u v t a a e l r r y - c T o o p d n t r u v a e l e r s i r b e n s n o i g o t n n d s a A l F l m o e t d o t e e u d r n a t l b s y l j ! j C of o n 19 so 3 l 0 s . • ! j 1 P 9 a 3 n 6 o a - f 1 m 9 a 3 s 8. Total. C b o o s n i n o v d n e s r . - Tr n 1 e o - a y t s e e u a s. r r y A v p e T r r s i o l i t o c a n o l s n . - sions. ca y le e n a d r. ar B Bo o a a r r d d , " i ml9i7. ! Boston §1,057,000 ; 1^1,057,000 $529,000 8528,000 $1,057,000 ! 31,332,000 $2,389,000 $2,696,200 I $307,200 New York $325,000 2,510,500 1,255,500 1,255,000 2,510,500 1,042,000 3,552.500 6,412,900 : 2,860,400 Philadelphia l! 092,' 000 6,200 1,098,200 549,200 549,000 1,098,200 1,651,000 2,749)200 2,814,200 ! 65,000 Cleveland 60,000 763,300 823,300 412,300 ! 411,000 823,300 ; 2,403,900 3,227,200 3,227,200 ! Richmond 1,799.100 1,799,100 1,799,100 . Atlanta 10,400 !. 10.400 16*4661 ioj-ioo"; 1,325;100 1,335,500 1,335,500 ! Chicago 832,000 !. 832,000 416,000 I 416.000 832,000 j 2,890,000 3,722.000 3,722,100 ' 100 St. Louis 1,106,300 '. 1,106,300 553,300 553)000 1,106.300 ; 1,106,300 1,504,600 398,300 Minneapolis 221,600 :. 221,600 111,600 110,000 221,600 i 1,060,000 1,281,600 1,281,600 i Kansas City 1,642,900 1,642,900 1,642,900 ' Dallas "I* 1,451,200 1,451,200 1,451,200 San Francisco. 2,000,000 2,000,000 2,112,500 : 112,500 •I; Total j 6,564,800 ; 1,094,500 I 7,659,300 3,837,300 I 3.822,000 j 7,659,300 | 18,597,200 26,256,500 '130,000,000 • 3,743,500 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

416 FEDERAL RESERVE BULLETIN. MAY 1, 1917. United States bonds, notes, and certificates of indebtedness held by all Federal Reserve Banks on Mar. 31, 1917, distributed by maturities. 2 per cent i i 2 co p n 1 e 9 s r o 3 0 l c s . e n o t f I 2 P 1 a p 9 n e 3 a 6 r - m c 3 e 8 a n . s t in c c d a e e t r e b t s i t f e i o - d f - ! 3 p lo 1 e 9 a r 1 n c 8 e o . n f t )3 p 1 lo 9 e a 6 r n 1 c o . e f nt c 3 o b p n o v e n r e d r s c s e o i n o f t n 3 p n 1 e o -y r t e e c a s e , r n t i • j 4 1 p lo 9 e a r 2 n 5 c o e . f nt Total. ness. 1946-47.1 Boston S750 83,000,000 3529.000 S2,194,000 So,723,750 New York 2,188,550 3325,000 20,000,000 §50,000 1,563,000 24,123,550 Philadelphia 1,092,000 6,260 3,500,000 1,999,000 6,597,260 Cleveland 26,400 3,500,000 2,586,560 2,600 1,290,000 152,369,200 9,774.760 Richmond 915,100 "237," 666' 2,000,000 1,969,000 ! 5,121,100 Atlanta 170,000 1,500,000 1,491,000 ' 3,161,000 Chicago 1,862,500 * "367," 3*66' 5,000,000 2,581,000 S400 427, 3,226,000 1,768,000 15,232.600 St. Louis 522.900 2,500,000 1,080,000 600, 891,000 5,593; 900 Minneapolis 33,650 *""i6,"260" 1,194,180 i ""soo" 3, 1,230,000 206,250 2,684,040 Kansas City 7,105,850 22; 240 2,500,000 j 838, 1,784,000 825,000 13,075,590 Dallas. 2,450,900 281,500 2,000,000 I 1,233, 1,430,000 I 7,396,000 San Francisco 2,428,750 2,500,000 1,500,000 j 6,428,750 Total. 18,794,350 1,255,560 ! 48,000,000 i 7,491,740 I 900 3,634,300 20,567,000 5,168,450 101,912,300 Amount of United States bonds with circulation privilege: i Amount of United States bonds, certificates of indebtedness, and notes 2 per cent $20,049,910 I without circulation privilege: 3 per cent 7,491,740 | 3 per cent of 1961 S900 4 per cent 5,168,450 j 3 per cent conversion 3,634,300 3 per cent 1-year notes 20,567,000 Total 32,710,100 \ 2 per cent certificates of indebtedness 48,000,000 Total 72,202,200 1 Amounts shown for 3 per cent conversion bonds of 1946-47 are exclusive of the conversions of Apr. 1, except for the Boston and Chicago banks. 2 S2,000,000 of United States certificates of indebtedness entered on books Apr. 2, 1917. RESOURCES AND LIABILITIES. Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System, at close of business on Fridays, Mar. 30 to Apr. 20, 1917. RESOURCES. [In thousands of dollars, i. e., 000's omitted.] I JBosfcon. Y N o e r w k. I I d P e h lp i h la ia - . ; : C la lo n v d e . - j ! m R o ic n h d - . la A n t t - a. c C a h g i o - . Lo S u t. i s. I | a M po in li n s e . -K C a i n t s y a . s Dallas. F c S i r s a a c n n o - . Total. ! Gold coin and certificates in vault: Mar.30 14,541 219,109 ! 24,065 ; 17,925 5,730 6,207 31,808 13,132 11,811 7,815 7,943 14,817 374,903 Apr. 5-6 13,350 209,993 22,020 ! 17,785 5,766 6,128 31,053 12,815 12,890 7,750 15,034 362,472 Apr. 13 13,495 189,519 I 24,072 | 18,398 5,792 6,171 27,361 12,526 11,913 7,809 7,811 13,502 338,369 Apr.20 12,513 180,192 i 22,749 , 17,963 5,984 6,139 29,557 12,070 11,975 7,844 8,166 15,000 330,152 Gold settlement fund: Mar.30 20,455 16,151 ; 14,25529,915 16,093 4,019 35,129 6,797 11,005 26,512 7,111 12,619 200,061 Apr. 5-6 15,940 26,443 ! 20,520 27,657 16,248 4,345 33,457 5,046 10,376 24 902 6,405 8,786 200,125 Apr.-13 19,814 27,692 i 17,457 25,017 15,819 j 3,168 36,979 2,394 8,817 26,487 6,732 7,895 198,271 Apr.20 20,552 21,992 | 18,071 30,653 15,915 j 5,631 40,752 j5,973 6,351 25,259 5,454 10,227 206,830 Gold redemption fund: Mar.30 50 250 ' 250 31 407 | 619 200 192 155 168 77 15 2,414 Apr. 5-6 50 250 I 250 25 396 ! 655 200 168 256 165 75 15 2,505 Apr. 13 50 250 ! 250 14 377 i 652 200 130 255 167 74 15 2,434 Apr.20 50 250 I 250 845 200 118 253 163 71 24 .2,651 Legal-tender notes, silver, etc.: Mar.30 2,116 199 78 111 i 1,551 1,416 1,766 jj 586 1,100 22 9,282 Apr.5-6 271 13,220 251 88 983 927 1,620 I 398 74 1,124 65 19,110 Apr.13 503 14,947 236 94 85 ! 994 1,150 1,591 ! 298 37 1,127 74 21,136 Apr.20 18,786 334 103 112 ! 816 1,349 1,092 J 285 34 1,067 24,462 Total reserve: Mar.30 35,315 237,626 38,769 47,949 22,341 | 12,396 68,553 21,887 | 23,557 34,563 16,231 27,473 586,660 Apr.5-6 29,611 249,906 43,041 45,555 22,499 i 12,111 65,637 19,649 i 23,920 33,029 15,354 23,900 584,212 Apr.13 33,862 232,408 42,015 43,523 22,073 i 10,985 65,690 16,641 I 21,283 34,500 15,744 | 21,486 560,210 Apr.20 33,513 221,220 41,404 48,778 22,379 i .13,431 71,858 19,253 ' 18,864 33,300 14,758 i .25,337 564,095 Five per cent redemption fund against Federal reserve bank notes: Mar.30 .! 300 100 400 Apr.5-6 .; 3oo 100 400 Apr.13 .! 300 100 400 Apr.20 J 300 100 400 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1, 10:! 7 FEDERAL BESEEVE BULLETIN. 417 Resources and liabilities of each Federal Reserve Bant and of the Federal Reserve System at close of business on Fridays, Mar. SO to Apr. 20, 1917—Continued. RESOURCES—C! >nUrmod. [In thousands of dollars, i. e., 000's omitted.] I Boston.:Y N o e r w k. Id P e h lp i h la i - a .' ; C la lo n v d e . - • m R o i n c o h . - . la A n t t - a. c C a h g i o - . Lo S u t. is, I j M ap i o m l i is c . - : ; K C an it s y a . s ! ; - * r> > » n " **. i - I AS ra a n n - '• T • o n t al + . i Bills discounted--Members: I Mar. 30 ! 4,168 • 868 1,087 • 1,551 3,754 | 2,123 ' 1,467 I 1,537 ! 035 I 1,643 ! 274 : 20,106 Apr. 5-0 ' 2,002 857 1,110: l',449 3.773 i 2,158 ' 1,055 • 1,326 1.400 ! 730 i 1,668 : 340 17,928 Apr. 13 ' 2,703 " 740 1)323 2)719 ! 4)663 ! 2,296 : 1,220 i 1,666 ! 1)770 ! 672 j 1,852 ' 385 22,009 Apr. 20 ; 6,307 1,798 974 : 3,280 ; 5,756 i 2,132 : 873 : 1,405; 3,697 i 534 1 2,408 . 573 29,737 Bills bought ir. open market: Mar. 30 ; 13,146 18,913 11,117 5,212 • 6.376 ; 3,584 8,002 ! 3,936 :4,129 • 2.228 !1,441 •• 6,38984,473 Apr.5-6 ! 11,816 18,298 11,620 • 5,040 6'. 4-15 •• 3,481 7,784 : 3)928 i 3.902 2)256 ; 1,283 - 6,882 . 82,735 Apr. 13 ! 10,597 " 18,993 11,226 j 5,300 6'. 535 2,829 . 6,824 I 3,587 5)304 i 1.508 i 920 j 6,861 80,604 Apr. 20 i 10,367 14,982 10,319 ! 4)098 (J', 055 2.558 5,623 I 2)923 . 6,403 I1)377 ' 848 ! 6,772 • 72,925 United States bonds: i i Mar. 30 : 81 i 4,985 442 170 5,961 ! 2,203 1,454 !8.147 !3,403 2,429 29,275 Apr. 5-6 ' 530 1,306 549 i 6.255 1.152 675 7,007 | 2,233 :1.735 ! 8)792 i 3,906 I 2.429 36,621) Apr. 13 ; 530 1,306 549 I 5'. 8-14 l'. 152 075 7,007 j 2.233 !1,735 8.792 :3.966 i 2)429 36,218 Apr. 20 ! 530 1,306 549 I 5)814 ! I'.152 072 7)007 ' 2:233 •1,735 ; 8)792 j 3'. 906 i 2,429 3(5,215 One-year United States Treasury notes: i Mar. 30 '.. 1.606 31 1.999 ! 1,590 •1,909 j 1,491 2,844 i 891 1.230 ! 1,784 i" 1,430 >•1,500 18,425 Apr.5-6 ; 2)194 2,788 2'.5!8 ! l',224 .1)969 ! 1.491 3,218 ! 1,444 1)452 I 1.784 ! 1,430 I 1,500 23)042 Apr. 13 : 2.194 2,788 I 2)548 ' l",775 •1.909 ! 1)491 2,995 ! 1,444 1.452 I 1)784 I 1,430 i 1,500 23,370 Apr. 20 ; 2:194 2)788 ! 2,548 I 1)775 "l)9G9 • 1,491 2,985 i 1.444 1)452 i 1,784 ; 1,430 J 1,500 23,360 Un ed it n e e d s s S : t ates cert!f.cates of indobi- [ ; : I Apr!! 5-6 ; 3.000 20.000 3.500 I 3,500 2.000 I 1.500 5.000 : 2,500 : 2,000 i 2,500 ! 2.000 2,500 50.000 Apri] 13 ' JUttO 20,000 i 3,500 i 3.500 2'. 000 ! 1.500 • 5.000 1 2.500 , 2.000 i 2,500 "' 2,000 2,500 : 50,000 Apr. 20 i 3,000 20.000 ! 3.500 i 3,500 2!000 i 1^500 5,000 ; 2)500 • 2,000 ; 2,500 j 2,000 2,500 50)000 Municipal warrants: ; Mar. 30 ' 298 5,199 1,378 i 3,066 2,653 ' 1,09-1 : 177 ! m j 506 • 830 "?5,7:?5 Fede A A A ra p p o l r r r . . . i 2 i 1 5 0 c 1 - * s 6 e rvc •H)V(:s---t s c . t:: ...' ; ; : 1 1 1 7 . 7 7 8 8 8 ! ' 5 5 5 : , i : 1 5 1 7 7 4 4 4 1 1 1. ) ,5 5 5 0 0 0 - 4 1 0 I 2 2 2 , , . 9 9 9 9 9 9 0 0 0 2 2 2 , . , 2 2 2 6 6 6 7 7 7 [ " . 1 1 ] . ' , . 0 0 0 6 6 fl S 8 8 • 1 1 7 7 7 7 : 1 4 4 5 5 6 6 ! j i 5 5 5 6 6 00 0 0 ; ' '. 8 8 7 1 1 8 1 1 6 • • • 1 1 i5 5 5 5 ) . 2 1 2 1 0 6 2 7 3 Mar. 30 ; 1.754 : 10.035 753 4,559 .• ! I 1.898 • 18,999 1,227 10.212 962 1,916 : 228 ! : 1)690 ! 16,235 Apr. 13 2,103 966 5,878 • ! ; 1,497 i 22,001 Apr. 20 1,337 9,6f,9 6'. 216 ! 58 i 1 1,796 20.640 Due from other ;A>.'Jo:\i! Reserve Hanks—net: Mar. 30... J.464 2,2o)> ' 5,065 ! 1,098 • 1,457 j • 12,275 Apr. 5-0 3, II4 1.591 ' 5'.899 ! -•...' '449 ! '437 j '• j.009 '13:41.2 Apr. 13 ' 3-13 2:987 : 5:030 > 2,327 : <»•):•? i , 3:271 : 1 j 1071 Apr. 20 L.537 ..'.....' 2)619 ! '482 '< 2.019 • I l',321 : 1 2,473 UncoIIectod item.-1: : i • ! ' 1 i ' i Mar. 30 11.3.V5 17.397 : 9.882 : 9.071 (i,192 18,806 • 8,421 ! 3,518 i 8.014 4.707 i 5,630 !132,759 Apr. 5-0... 12'.2S2 . 26'. 027 19'. 850 ! 9'. 064 :It)! 131 7.427 i 24)681) ! 10,503 ! 3.370 I 9)144 : 6:386 i 7'. 549 •146,422 Apr. 13 16',4-!S • Ti. 995 22JM7 I 2:531 10'. 113 9,2m i 23.060 , 9,606 ' 4,271 : 9.308 5)421 ! 8)198 !169'. 184 A pr. 20 ' i 3-J) 140 19.969 j 9,715 8,610 i 2i:467 1 9)853 ! 4.046 ! 8)688 : 7,032 I 7,915 :1(16)960 Ail other resources: Mar. 30 70 I 150 m 1,686 : 258 ! 450 I J4fi | 297 : 1,172 ' 462 , 5,393 Apr. 5-6 615 142 I 123 84 •1,133 • 571 j 306 I 159 i 183 ; 1.227 i 32L - 4.909 Apr. 13 79 1 162 ! 203 856 i 734 i 301 i 166 ! i'.006 I 342 ; 4'. 610 Apr. 20 60 791 110 ' 148 68 1,330 ! 592 I 165 i 118 I 163 1)040 i 151 ; 4) 770 Tot»! resources: Mar. 30 67.703 •303,076 73,290 i 76,'156 44,407 29,912 118, J 68 ' 40,419 ! 36,911 57,OH ; 30,633 I 46.891 i 914,4SO Apr. 5-(> 66'. 299 335,183 83,864 ! 78,906 •18,058 31,574 125,013 i 42,957 j 3S.624 59.839 I 33,974 i 48)931 :981.131. Apr. 13 72,037 •331.506 85,774 ! 81,197 48.597 32.917 .125,705 : 41,373 ! 38)l5S 6iJ'.925 ,32,999 49,280 98:1)889 Apr. 20 80.8:14 !313'.385 80.912 i 85:042 50:102 31'. 736 126,507 ! 41)326 \ 38,487 59'. 971 I31)142 51)080 ;980, 74.1 LLABTLITISS. [In ihousancJs of dollars, 1. e., GOO's omitted.] Capital paid in: : Mar. 30 ' 5,068i 11, 5.260 i 6,089 3,428 : 2,410 ; 7.001 i 2,795 '• 2,416 '• 3.088 2,698 3,911 56,075 A pr. 5-0 j 5,059 1 11, 5)260 i 6,0S9 3,431 ; 2.418 ! 7,002 ! 2,795 : 2,419 I 3.088 i2,716 3,941 56) 100 A pr. 13 ; 5:059! 11 5,260 i 6)240 3,431 •• 2'. 418 ! 7.002 !2,945 2,419 ! 3)088 : 2,722 3,912 56,408 A pr. 20 i 5) 059i11 5,259 : 6,240 3,431 ! 2)418 j 7)002 ; 2,915 : 2,130 3,089 : 2) 723 3,933 56,411 Government deposits: i Mar. 30 .- i 1,373 1,748 i 335 1, 710 2.293 I 2,696 '. 420 1,236 1 413 ' 670 1,016 20,567 Apr. 5 -0. i 'i, 902 5,241 4,101 4.0H9 4'. 403 i 6,660 •2.055 ! 3,345 2,908 2,718 3,731 40,461 Apr. 13 ; 3,600 •4'. 819 • 4.2S8 3) 169 8'. 544 ! 5,613 ' '688; 3.31.6 3,050 •2,731 3,027 42,247 Apr.20 " 3,262 4)627 . 2)441 2,701 "3)020 • 7,828 ; 512 ; 2)329 2,567 ;2,203 3,391 41)988 .Duo to members -reserve account: : Mar. 30 52,182'254, 48,9-19 59,845 25, S(>() 18,8S9 I 96,348 ^26,620 '28,231 i 47,032 '23,075 38,408 720,411 Apr. 5-0 • 47,720;29i, 50,703 : oS, 464 25.592 18,708 ' 98,918 i2(),8S0 •29,793 I 47,220 : 24,028 i 38'.497 758,219 Apr. 13 ' ' 49,698 268, 49,877 : 60,832 26)744 19)275 100,203 .28,000 29,025 i 47,529 ••23,253 38)623 741,542 Apr. 20 ' 54) 753'267, 47,830 : 63,513 20,152 • 18.478 '• 97)255 :27,759 I28,808 i 47,471 •23,145 I 39,838 742,584 1 Di'i'eronce between net amounts due from and net amounts due to other Federal Reserve banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

418 FEDERAL RESERVE BULLETIN. MAY 1, 1917. Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at close of business on Fridays. Mar. SO to Apr. 20, 1917—Continued. LIABILITIES—Continued. [In thousands of dollars, i. e., 000's omitted.] Boston. Y N o e r w k. : P d h e il l a - - C la le n v d e . - m R o ic n h d - . ! phia. Collection items: i Mar. 30 21,215 ! 15,362 10,187 7,753 4.431 ! 12,123 Apr, 5-6 9,490 19,519 | 18,341 10,252 7,720 4,064 i 12,433 Apr.13 13,557 29,323 j 23,182 12,837 8,562 5,650 I 12,887 Apr. 20 15,037 26,728 18,988 12,848 9,940 5,180 ! 14.422 Federal Reserve notes, net: I Mar. 30 1,821 5,710 Apr. 5-6 .j 2J960 i ! 6,345 Apr.13 -I 2,075 1 6,478 Apr. 20 -! 2,881 ! | 7,878 Due to other Federal Reserve Banks, net: Mar. 30 370 I 8,791 i ! ! Apr. 5-6 i 8,697 • 1,187 ! i 891 Apr.13 ! 17,250 | 386 i | 213 Apr.'20 2,655 • | 1,190 i ; All other liabilities: Mar.30 : 112 ! 166 150 Apr.5-6 128 ! 171 172 Apr.13 123 i 166 175 Apr. 20 78 ; 122 131 Total liabilities: Mar.30 67,703 303,076 i 73,290 | 76,456 I 44,467 ! 29,912 118,168 46,891 ! 914,480 Apr. 5-6 66,299 335,183 83,864 | 78,906 I 48,068 \ 31,574 125,043 48,931 ! 981,131 Apr.13 72,037 ;331,506 85,774 i 84,197 48,597 ! 32,917 125,705 49,280 " Apr. 20 80,844 313,385 80,912 ! 85,042 50,102 31,736 126,507 FEDERAL RESERVE NOTES. Federal Reserve note account of each Federal Reserve Bank at close of business on Fridays, Mar. SO to Apr. 20, 1917. [In thousands of dollars, i. e.f 000's omitted.] Boston. la A n t t - a. c C a h g i o - . Lo s u t. is. M ap i o n l n is e . - K C a i n ty sa . s Dallas. F c S i r s a a c n n o - . Total. Federal Reserve notes received from agent, net: Mar.30 17,124 165,910 25,710 15,645 16,737 20,422 25,139 I 15,010 20,271 23,223 21,156 16,217 382,504 Apr. 5-6 17,103 176,808 27,054 17,207 16,857 19,944 27,052 ; 15,955 21.248 23,688 20,593 17,189 400,698 Apr. 13 19,076 188,239 30,367 19,182 16,812 20,047 36,681 I 15,877 22,229 24,437 20,662 18,179 431,788 Apr. 20 19,055 191,183 30,024 21,551 16,758 19,883 39,434 i 15,557 22,686 24,748 20,661 18,999 440,539 Federal Reserve notes held by bank: Mar.30 1,754 10,035 1,529 818 942 4,559 ! 850 589 401 1,741 24,799 Apr. 5-6 1,227 10,212 1,190 962 775 450 3,836 ' 1,586 888 1,253 124 1,685 24,188 Apr.13 2,103 11,557 2,075 966 687 601 6,918 I 1,224 1,051 932 374 1,491 29,979 Apr. 20 1,337 9,669 1,269 1,564 786 6,216 j 631 1,081 1,084 180 1,796 26,182 Federal Reserve notes in circulation: Mar.30 15,370 155,875 24,181 14,892 15,919 19,480 20,580 I 14,160 19,682 22,395 20,755 14,476 357,765 Apr.5-6 15,876 166,596 25,864 16,245 16,082 19,494 23,216 i 14,369 20,360 22,435 20,469 15,504 376,510 Apr.13 16,973 176,682 18,216 16,125 19,446 29,763 i 14,653 21,178 23,505 20,288 16,688 401,809 Apr.20 17,718 181,514 28,755 19,987 15,972 19,314 33,218 ! 14,926 21,605 23,664 20,481 17,203 414,357 Gold and lawful money deposited with or to credit of Federal Reserve Agent: Mar.30 17,124 165,910 22,360 15,645 10,209 17,591 25,139 | 11,663 16,971 21,818 20,019 16,219 360,668 Apr.5-6 17,103 176,808 22,904 17,207 9,737 17,513 25,132 I 13,108 19,338 22,663 19,743 17,194 378,450 Apr.13 19,076 188,239 26,217 19,182 9,647 17,416 35,641 I 13,530 20,719 23,228 19,716 18,185 410,796 Apr.20 19,055 191,183 25,874 21,551 8,094 17,312 39,434 i 13,210 20,676 23,722 19,428 18,999 418,538 Commercial paper delivered to Federal Reserve Agent: ! Mar.30 J 3,390 6,728 2,856 3,352 3,300 1.423 2,001 23,050 Apr.5-6 4,189 7,200 2,456 1.941 2,860 I 1,910 i;il4 1,894 23,554 Apr.13 4,186 7,712 2,644 1,056 2,352 !1.510 1,216 1,918 22.594 Apr.20.... 4,186 9,143 2,581 2,348 j2.010 1,040 2,518 23,826 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY 1, 1017. FEDERAL RESERVE BULLETIN. 419 Federal Reserve note account of each Federal Reserve Agent at close of business on Fridays, Mar. 30 to Apr. 20, 1917, [In thousands of dollars, i. e. 000's omitted.] ton. Y N o e r w k. P p d h h e i l i - l a a . - land. m R o ic n h d - . la A n t t - a . j ! c O a h g i o - . Lo S u t. is. M ap . o _- l . i _ s. j K C a lt n y s - as Dallas. F c S i r s a a c n n o - . TotaL FEDERAL RESERVE NOTES. ! Received from Comptroller: I Mar. 30 ; 33,880 300,560 ! 39,120 27,460 29,500 36,380 • 32,560 23,340 32,000 37,720 I 36,120 19,060 647,700 Apr. 5-6 ! 36,880 313,600 ! 39,120 27,460 !29,500 36,380 ! 34,480 23,340 32,000 37,720 i 36,520 20,060 667,060 Apr. 13 j 36,880 326,640 j 42,520 29,060 i 29,500 36,380 ! 44,120 24,140 32,000 37,720 i 36,520 21,060 696,540 Apr. 20 ! 36,880 325,640 43,440 32,200 29,500 36,380 i 48,240 24,940 34;000 37,720 36,520 22,060 708,520 Returned to Comptroller: ; Mar. 30 ' 9,156 68,970 I 7,6105,115 I 9,163 I 5,153 i 1,881 3,990 3,284 3,739 7,013 2,843 127,917 Apr. 5-6 , 9,177 69,272 ! 7,666 5,153 9,243 I 5,281 1,888 4,045 4,452 3,874 ! 7,326 2,871 130,248 Apr. 13 9,504 69,641 I 7,753 !5,278 9,488 j 5,378 1 4,123 4,721 4,265 I 7,362 2,881 132,292 Apr. 20 ; 9,525 71,497 i 8,0P6 |5,3 9,542 ! 5,542 1,906 ! 4,443 4,764 4,544 j 7,673 3,061 135,902 Chargeable to Federal Reserve i A sent: i Mar. 30 ; 24.724 231,590 31,510 j 22,345 20,337 ! 31,227 i 30,679 j 19,3502 I8,716 33,981 I 29,107 16,217 519,783 Apr. 5-6 : 27', 703 244,328 i 31,454 j 22,307 i 20,257 31,099 : 32,592 ! 19,295 ! 27,548 ! 33,846 I 29,104 17,189 536,812 Apr. 13 27,376 256,999 I 34,767 \ 23,782 20,012 ] 31,002 ! 42,221 ! 20,02177,279 33,455 ' 29,158 18,179 564,248 Apr. 20 i 27,355 255,143 : 35,344 | 26,891 19,958 • 30,838 ; 46,334 ! 20,2499,7236 33,176 I 28,847 18,999 572,618 In hands of Federal Reserve Agent: : Mar. 30 •: 7,600 65,680 i 5,800 i 6,700 3,600 10,805 i 5,540 i 4,340 8,445 10,758 j 7,951 137,219 Apr. 5-6 10,600 67,520 ! 4,400 !5,100 3,400 11,155 : 5,540 ! 3,340 6,300 10,158 8.601 136,114 Apr. 13 i 8,300 68,760 ; 4,400 \ 4,600 3,200 10,955 5,540 ! 4,1405,050 9,018 8', 496 132,459 Apr. 20 ; 8,300 63,960 I 5,320 j 5,340 3,200 10,955 : 6,900 i 4,940 6,550 8,428 I 8,186 132,079 Issued to Federal Reserve bank less amount returned to Federal Reserve Agent for redemption: Mar. 30 ; 17,124 j 165,910 I 25,710 i15,645 I 16,737 20,422 ; 25,139 ; 15,010 20,271 I 23,223 | 21,156 j 16,217 382,584 Apr. 5-6 17,103 ! 176,808 i 27,054 j17,207 ! 16,857 i 19,944 ' 27,052 '. 15,955 I21,248 I 23,688 j 20,593 j 17,189 4001698 Apr. 13 ; 19,076 ! 188,239 I 30,367 1|9,182 ! 16,812 20,047 ; 36,681 j 15,877- j22,229 ! 24,437 ! 20,662 I 18,179431,788 Apr.20 ; 19,055 1191,183 I 30,024 :21,551 I 16; 758 ' 19,883 39,434 ! 15,557 !22,686 I 24 748 I 20 681 | 18,999 440.539 Amount held by Federal Reserve • Agent: i In reduction of liability on out- : i standing notes— : Gold coin and certificates ; on hand— Mar. 30 15,910 159,404 j 3,730 9,773 2,897! ! 5,165 13,018 2,370 10,110 222,377 Apr. 5-6 i 1ie5 '9n1m0 I1'm70 «,6n0i 1 Q3 »,77Q3n0 10,273 2,896 ' i 5,665 13,018 2,370 10,110 234,573 Apr. 13 : 17,910 181,001 3,730 10,213 2,896 j i 6,165 13.918 2,370 10,110 248,313 Apr.20 1 17,910 184,181 3,730 10,913 2,897! ! 6,165 13', 918 2,370 10,110 252,194 Credit balances— In gold redemption fund- Mar. 30 1,214 6,506 1.340 ! 872 i 709 i 1.774 • 548 823 1,188 1,229 I 739 17,031 Apr. 5-6 1,193 6,207 1.484 i 934 ! 637 ' 1.647 682 -. 1,200 i;i33 1,173 714 17,697 Apr. 13 i 1,166 7.238 1:597 ! 547 i 1,550 ! 671 i 615 1,081 1,098 1,146 905 IS,583 . Apr.20 1,145 7,002 1,554 I 1,138 494 i 1,385 : 664 i 775 1,038 1,492 1,068 18,644 With Federal Reserve : Board— | Mar. 30 : 17,290 5.000 ! 9.500 ! 12,920 24,450 i 5,950 3,130 18.260 8,680 15,480 120,860 Apr. 5-6 i 17,690 6,000 ! 9,100 12,970 24,450 i 6,750 5,120 19!160 8,460 16,480 126,180 Apr. 13 1 20,890 1 8,000 9.100 I 12,970 34,970 j 6,750 5,720 19,760 8.460 17,280 ! 143,900 Apr. 20 1 20,590 9,500 7;600 : 13.030 38,770 ! 6.270 5,720 19,860 8,250 18,110 i 147.700 As security for outstanding notes— ! Commercial paper- Mar. 30 ; 3,350 6,528 i 2,831 ! 3,347 3.300 1,405 i 1,137 21,898 Apr. 5-6 1 4,150 7,120' 2,431 1,920 ! 2,847 1,910 L025 ! 850 22,253 Apr. 13 ! 4,150 7,165 ! 2,631 1,040 ! 2,347 1,510 1.209 j 946 20,998 Apr.20 : 4,150 8:664 I 2,571 1 2,347 2,010 1,026 | 1,233 22,001 Total— i Mar. 30 i 17.124 165,910 25,710 15,645 ! 16,737 20,422 25,139 15,010 20,271 23,223 '21,156 16,219 382,566 Apr. 5-8. : 17,103 176,808 27,054 Hi 207 1 16,857 19,944 27,052 15,955 21,248 23,688 20,593 17.194 400,703 Apr. 13 ! 19,076 188,239 30,367 19,182 ' 16,812 20,047 36,681 15,877 22,229 24,437 20,662 18', 185 431,794 Apr 20 i 19.055 191.183 30,024 21,551 I 16,758 19,883 39,434 15,557 22.686 24,748 20,661 18,999 440,539 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

420 FEDERAL RESERVE BULLETIN". MAY 1, 1917. Amounts of Federal Reserve notes received from and returned to olher Federal Reserve Banhsfor redemption or credit during the period Jan. 1 to Mar. 31, 1917. Boston. New York. Philadelphia. Cleveland. Richmond. Atlanta. Chicago. Re- Rc- Re- Re- Re- Re- Re- Re- Re- Re- ! Ee- i Re- Re- Received.; turned. : ceivod. i turned. | ceived. turned, ceived. turned . ceived. turned. | ceived. j turned. ceived, turned. ! 1" Boston .31,129,000: -$436,900 §89,400 S4 8,0001878,500! S6,700; S51,000; S9,500| S35,700: 814,200 Sj1j.3d,. 300i S37,500 New York $436.900 SI,102,000 ! : 857,000 1,445,000:241,095' 151,700! 1.195,510" 266,0001.069,800: 256,900 60,300! 604,000 Philadelphia... ' 48'000 89,400 1,465.000" 857,000. I 62,000; 21,195i '148,000 7.1,750; 61,000: 28,750 7,000i 44,500 Cleveland (i700 78,500, 154,700 241,400' 24,195 62, OOOi !. 16,240| 21,500; 12,000. 27,150 12,295! 145,500 Richmond 6,500 5i,ooo: 272,000.1.196,200 69, 750 148,00()| 21,5001 16,240! 107,750 290,800 3,000; 72,000 Atlanta 1-1200 35,700 257,3001'0(59,800: 28,750 61,000" 25,050' 13,500! 290,800, 101,750,. 8,350 181,000 Chicago 37!500 13,300. 604,000 ' 60,300! 44,500 7,000'-1.45,500: 12,2951 64,000'- 3,000! 159,000' 8,350 St. Louis 8'200; 14,400! 245,000 180,400! 13,500 17.0001 26,950; 7,875 30,250! 9,500 323,245 143,000 26," 300 "225 .'666 Minneapolis 4.000! 27, 4001 65,000 156,500 5,000 23',000| 14,000; 17,130 2,500! 6,50()i 4.500! 23,850 15,000j 894; 000 Kansas City 1;715 22,300 27,800. 208,900; 1,900 22,000 3", 1001 10,945 4,400: S, 750' 16', GOO' 68,950 4", 000 554,500 Dallas .' 2,795! 23,400; 119,470' 272,600! 3,450 22,000 5,740i 9,500 10,280! 8,750. 194,880: 348,350 9,785 252,000 San Francisco.. 4'.185 23,600" 76,945 554,800: 5,230 27.000 9,275 6,300| 6,745! 2,500" . 10,830 15,550 7,675 129,000 Total : 570,695!1,481,000J4,416,215 5,234,80011,142,675 1,882,000J|6J63333,:310 279,38011,819,725; 509,5001,995,3051,225,850 167,005 3,139,000 St. Louis. Minneapolis. Kansas City. Dallas. San Francisco.' Total. Re- Re- ! Re- j Re- Re- j Re- i Re- Re- Re- Re- ; Re- j Re- ,ceived.! turned, ceived. ; turned. ceived. ! turned, ceived. turned, ceived.. turned.; ceived. : turned. ! 1 Boston -'§14, S8,200 S27,400,: S3,000 S22,300: S1.715: $21,600! m, 045 S23,600 SO, 520 SI,506,200 S577,280 New York '180, 245,000 156,500! 65,000 208,900: 27! 800' 287,600! 134,470 554,800 76,945. 5,248,8051 4,377,815 Philadelphia I 17,000 j 13,500 23,000: 5,000 2222,,000000! 1,900 22,000! 4,700 27,000 5,230 1,902,000j 1.145,925 Cleveland I 9,87o! 26,950 17,130 14,000 10,945!: 3,100. 9,5001 6,240 6,300 9,275 279,880' '635,615 Richmond j 9,500 30,250 6,500 2,500 8,750; 4,400 8,750; 11,280 2,500 6,745' 516,500 1,829,415 Atlanta ! 143,000 323,250! 23,850 4.500 66,700" .16,600- 318,350 218,630 16,745 10,830 1,223,695! 2,036,560 Chicago ;225,000 26,3001 891,000 15', 000 474,500 4, OOOi 215,000 12,035 129,000 7.6751 2,992,000' 169,255 St. Louis |. 92,950; 11,000 831,600| 58,700' 670,750: 172,970 30,850 12', 730" 2,299,595 852,575 Minneapolis :. n, 000: 92,950!. 53,000 31,300' 15,500. 20,200 57,000 74', 190 246,500 1,370,020 Kansas Citv '..i 58,700! 831,600^ ""34,"366""53,' 666 101,000 246,370 11,000 OD, 215; 264,515; 2.082,530 Dallas : ;i60,970| 670, 50! 20,200! 15.500 19,360 40,175! 763,050 i;764,025 San Francisco 12,730: 30,850; 74,190. 57,000 40,175, 20,610 '. 303,1951 878.210 Total 842,575 2,299,600 1,370,020; 247,500 1,970,030 264,515 1,740,225. 850,550 878,155! 305,530.17,545,935;17,719,225 EARNINGS ON INVESTMENTS OF FEDERAL RESERVE BANKS. Average amounts of earning assets held by each Federal Reserve Bank during March, 1917, earnings from each class of earning assests, and annual rates of earnings on the basis of "March, 1917, returns. ' . Average"balances for the month of t;ie several classes of earning assets. m c B o e il m u ls n b d t e e i r d s s - , . Bi m l i l n s a o r b k p o e e u t n g . ht U b n T o i r t n e e d d a s s S u a i r n a y d i . es ! ! ' M wa u r n r i a c n ip ts a . l Total. •notes. ! Boston 270.240 777,748 81,066.000 8387.398 = 551 (} 101.386 New York : 956^514 883.711 1,205,421 5.892;354 ; "32;438.; 000 Philadelphia ; ,413,082 757', 278 2.147,;S31 l', 400,076 16,717,767 Cleveland ,815; 861 578.275 6:849,760 3. J12,424 ; 19,356,320 Richmond v : 656,100 fi-12, 895 2.410,600 i 15,000 1 7 2,924.601 A tlanta .' 052,823 448,110 l'. 625.451 10,760 = 7,137;144 Chicago ,73% 431 906'. 4=19 I 8', 901,068 • 2,692.588 : 22,236,536 St. Louis 718,645 844^ 575 3,098.900 ; lJ0o!768 ; 10.762; 888 Minneapolis • ! 511,400 823.500 2,6(55^500 : '320; 600 io!321,000 Kansas City ' 491,442 337', 388 9.901,810 488,309 11.218,949 Dallas - ,331,225 913.320 4'. 851,403 518,194 ; 6.14.142 San Francisco 237.000 913,000 3;929;000 i 898,000 11,975'. 000 Total 18,190.769 ! 99,026,249 j 49.247.244 6,339,471 .182,803,733 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MAY!., 1017. FEDERAL BESERVE BULLETIN. 421 Average amounts of earning assets held by each Federal Reserve Bank during March, 1917, earnings from each class of earning assets', and annual rates of earnings on the basis of March, 1917, returns—Continued. Earnings from— nial ed annual rales of earnings from— 1 United Hanks. c 3U o m b u 1 e e n I r m s t s e . d - d i , s- m b in o H a u r o i k l g p l e s h e t t n . T b S re a o t a a n n s t d d e u s s ry p " M r a a l u n n w t i s a c , r i - - i i j Total. m c B o e il u m l n s b t d e e i d r s s , - . m i b n H o a u o r i k l g p l e s e h n t t . b T o U r S n e t n d a a i s s t t e e u a s d r n y d p M a ra l u n n w t i s c a . i r - - Total. •notes." notes. Per cent. Per cent. Percent. 1 Percent. Percent. Boston j 87,449 S31, £4,458 S].005 $44, 3.86 ! 3.17 3.00 I 3.05 3.27 New York j 3,016 67, 2,500 33;790 8(i, 3.71 I 3.18 2.44 3.01 3.14 Philadelphia i 4,477 30,441 j 5,359 3,387 43', 3. 73 3.04 2.93 2.84 3.07 Cleveland | - 5,630 19, •64 ! 15.049 8; 450 t 3.65 3.07 2.59 3.20 2.98 Richmond i 12.097 I"',, 678 5'848 53 3. 90 3.04 2.85 4.15 3.25 Atlanta (>', 708 9,M0 I 4,08! 43 3. 85 i 3. 26 2.96 4. 75 3.36 Chicago I 5,8-1.9 21,658 ! 19,279 7,091 20. 3.97 I 2. 86 2.60 3.10 2.87 St. Louis j 2,425 1.5,696 ! 6,(543 2 855 53, 3.98 I 3.16 2.53 3.04 3.02 Minneapolis I 5,919 l'r>i 591 j 5,788 797 27, 4.61 I 3.15 2. 56 2.92 3.20 S K D a a a n l n l s a F a s r s a n C c i i t s y c o I j I 5 2 ' , . 9 1 4 1 3 0 7 6 4 1 4 6 8 , , ,8 9 7 0 8 2 4 4 0 ! j | 1 1 8 9 0 , , . 3 9 6 1 1 2 9 6 2 1 2 1 , , , 3 2 2 3 5 2 6 3 2 3 2 2 2 - 2 X . . , 4 5 4 . . . 1 5 8 0 7 8 2 2 3 . . . 9 9 1 0 7 0 2 2 2. . . 5 3 6 4 7 3 2 3 2 . . . 1 9 9 3 2 7 3 2 2. . . 6 0 8 6 0 0 28; Tots! | 62,027 259,890 107,862 j 42,282 472,061 4.14 3.19 2. 66 3.15 3.14 DISCOUNT RATES. Discount rates of each Federal Reserve Bank in effect Apr. 80, 1911 Maturities. Discount?. : Trade acceptances. Com mo d- 1 ! itv ]>aper maturincc W d c a l i y u th s d , i i n n i n g 1 - 5 16 to 60 61 to 90 ! 1 a A n t g d u r r i l c a iv u l e l- - ; To 60 : 1 61 to 90 wi d t a h y in s . 90. in ember davs, in- days, in-! stock ' davs, in-i davs, inbanks' clusive. elusive. ! paner : elusive. : elusive. collateral ! over 90 notes. | days. * Boston 31- A 4 i '. 37,! 3^ 4 New Yorlc 4 4 ! 5 ! 3^ Philadolphia - 3.', 4 4 ! 4i V, i 3 5 31 Cleveland ?>% 4 41 ! 5 V, 4" "Richmond qf 4 4 i I.', :-Ui ^1 37, A tlanta 31 4 4.', ! 5 o.T, I :U 31 Chicago 31 4 4i ! i" ! of ! v. S M t. i n L n o e u ap is olis 4" 4 4 4 4 " 1 : ! 5 1 0 T i! ?4,}", 3 4 1 Kansas Citv 4 <U 41 ! • -1" i i 4 Dallas 31 4 41 i ,- 3* i V. 31 San. Fran'1!sco •4 4 4-jl 4 V NOTE.—Rate for bankers' acceptances, 21 to 4 per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

422 FEDERAL RESERVE BULLETIN. MAY .1., 1017, GOLD IMPORTS AND EXPORTS. Gold imports and exports into and from the United States. [In thousands of dollars; i. e., 000's omitted.] Week ending— Total for Total corresince sponding M 1 a 9 r 1 . 7 2 . 3, M 1 a 9 r 1 . 7 3 . 0, A 1 p 9 r 1 . 7 6 . , A 1 p 9 r 1 . 7 1 . 3, J 1 a 9 n 1 . 7 1 . , d p 1 u e 9 r r 1 i i o n 6 d g . IMPORTS. Ore and base bullion 436 238 259 304 4,189 3,057 United States mint or assav office bars 1 7 1,021 Bullion, refined 1 652 40,332 34,307 402 218,912 8,459 8 Tnited States coin 12 1 51,019 128 Foreign coin 54 2,433 207 2,433 55,985 24,923 Total 1,142 43,015 ; 34,775 3,139 330,112 37,588 i Domestic: . EXPORTS. Ore and base bullion 20 '• 72 135 United States mint or assay office bar5* 1,726 2 j 2,283 2,677 9,926 3,331 .Bullion, refined 16 4 ! 16 43 1,273 3,523 Coin 2,992 3,707 ! 2,773 3,803 55,794 16,627 Total 4,734 3,733 ! 5,072 6,523 67,065 23,616 Foreign: Bullion, refined 31 1,438 Coin 240 137 ; 253 49 4,502 12,335 Total 240 137 : 253 49 4,533 13,773 Total exports 3,870 ; 5,325 6,572 71,598 37,389 Excess of gold imports over exports since Tan. 1, 1917, S258,514. Excess of gold imports over exports since Aug. 1, 1914, $1,127,276. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. Acceptances: Page. Page. Distribution of, by classes, maturities, etc 412 Governors of Federal Reserve Banks, conference of. 347 Growth of the acceptance business 350 Growth of the acceptance business—: 350 Branch banks in the Pacific Northwest 339 Informal rulings of the Board: Business conditions throughout the Federal Re- Form of trade acceptance 378 serve districts 381-403 Acceptances 378 Charts showing foreign exchange rates in belliger- • Cattle paper 378 ent, neutral, and silver-standard countries 406 Place of payment of acceptance 379 Clearing and collection system, operation of 354 Farm-loan bank deposits 379 Commercial failures reported 374 Paper of equity exchange 379 Discount operations of the Federal Keserve Banks. 407 Law department: Discount rates in effect 421 Domestic bankers' acceptances 380 Drafts, Federal Reserve, forms of 347-349 London Economist, reprint of article from, on "The Federal Advisory Council, meeting of 340 progress of inflation " 375-377 Federal Reserve Banks: National-bank charters granted 374 Investment operations of 420 National-bank examinations, payments for 374 Resources and liabilities of 416 Ohio Bankers' Association, circular of, on war Federal Reserve notes: service 351 Accounts of Federal Reserve Banks and agents. 418j Press statements: Amounts received from and returned to Federal Reports of condition of national banks 372 Reserve Banks for redemption 420 Reserves held by national banks 373 Substitution of collateral 351 Resources and liabilities of Federal Reserve Banks.. 416 Fiduciary powers granted to national banks 3/5 Review of the month 335-340 Foreign exchange rates in belligerent, neutral, and State banks: silver-standard countries 404-406 Admitted to system during month 347 Charts showing 406 Answers to questions as to advantages of mem- Foreign war loans 349 bership in system 355-372 German war loans 350 Treasury certificates of indebtedness 340 Gold imports and exports 422 United States bonds, issues of, for war purposes.. 340-344 Gold settlement fund, summary of transactions War-bond act, text of 345-347 under 353-354 War bonds, issues of 340-344 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis