Federal Reserve Bulletin, 1918-01

FEDERAL RESERVE BULLETIN ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON JANUARY, 1918 WASHINGTON GOVERNMENT POINTING OEJB1CE 1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BOARD. EX OFFICIO MEMBERS. W. P. G. HARDING, Governor. PAUL M. WARBURG, Vice Governor. WILLIAM G. MCADOO, FREDERIC A. DELANO. Secretary of the Treasury, ADOLPH 0. MILLER. Chairman. CHARLES S. HAMLIN. JOHN SKELTON WILLIAMS, Comptroller of the Currency. H. PARKER WILLIS, Secretary. SHERMAN ALLEN, Assistant Secretary and Fiscal Agent. M. C. ELLIOTT, Counsel. 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 ten 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. n Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SECOND EDITION OF THE INDEX DIGEST. The Federal Reserve Board has had prepared a second edition of the Index Digest of the Federal Reserve Act, by Hon. Charles S. Hamlin, member of the Federal Reserve Board, the first edition of which was published in 1915. While the edition is primarily for the use of the Board, enough copies will be printed to supply the demand of banks and others who [may desire to purchase them. Those who desire copies (bound in paper) should at once remit $1 or (bound in cloth) $1.25 to the Federal Reserve Bank of the district in which the subscriber is resident. Copies of the edition, when published, will be transmitted to the respective Federal Reserve Banks for distribution. in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TABLE OF CONTENTS. Page. Review of the month 1 Acceptance liabilities of American banking institutions 11 Tax on parcel-post packages 12 Opinion of Attorney General on power of Federal Reserve Board to grant fiduciary powers to national banks 12 Statement of Secretary of the Treasury regarding charges for cashing Liberty bond coupons 13 Banks granted authority to accept up to 100 per cent of capital and surplus 13 Election of directors of Federal Reserve Banks 13 New national-bank charters issued 15 Fiduciary powers granted to national banks 15 Commercial failures reported 16 State banks and trust companies admitted to system during month 16 Resources of national banks as shown by comptroller's call 17 Paper currency outstanding 18 Extracts from annual report of the Secretary of the Treasury ; 18 Assessment for expenses of the Federal Reserve Board 24 Gold settlement fund 26 Operation of the Federal Reserve clearing system 27 Changes in principal assets and liabilities of the New York clearing house banks since April, 1917 28 Chart showing 28 Informal rulings of the Federal Reserve Board 30 Law department 32 Business conditions throughout the Federal Reserve districts 36 Discount operations of the Federal Reserve Banks 52 Resources and liabilities of the Federal Reserve Banks 58 Federal Reserve note account of Federal Reserve Banks and agents 60 Member-bank condition statement 61 Earnings on investments of Federal Reserve Banks 65 Gold imports and exports 66 Discount rates in effect 66 Foreign exchange rates 67 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN VOL. 4 JANUARY 1, 1918. No. 1 REVIEW OF THE MONTH. there are other services of equal, if not of greater, consequence in the successful financing of the The year 1917 will stand in financial history war in which the help of the banks of the as the beginning of a new and The close of a , ,, to ? , , . , . country will be needed. In extending a word remarkable year. wholl7 unprecedented period in of greeting to its member banks with the open- American public finance and ing of the new year and as we approach the banking, due to the entrance of the United threshold of our second year in the war, the States into the European war, and the far Board feels it proper to point out certain funreaching economic changes resulting therefrom. damental methods in which it believes the banks For the Federal Reserve system it will like- can help in placing the financing of the war wise mark an epoch due to the assumption of upon a foundation of unshakeable strength. new duties and relationships which have greatly War financing in the last analysis means enlarged its duties and responsibilities. putting the Government in possession of goods In reviewing the year just closed, the country and services. Financing by loans means the can not but regard with profound satisfac- sale to the Government of goods on credit. tion the part played by its banking system To win the war our Government and the under the leadership and with the support of Governments with which we are associated the Federal Reserve Banks. The way in must have goods and services. It is of as which the Federal Reserve System has with- much importance, therefore, that the Governstood every test to which it has been subjected ment should be helped to obtain the goods it shows the wisdom with which it was conceived, requires as it is that it should be helped to and that in it the country now possesses a procure the credit it requires with which to pay financial foundation of unrivalled solidity. for goods. In neither respect are the American Financing of the war has, however, placed people as yet cooperating to a sufficient degree, unexpected and heavy burdens not only upon primarily because they have not yet been the Federal Reserve Banks but on the banks adequately impressed with the paramountof the country generally. The zeal and effi- importance of their cooperation. They have ciency with which they have responded to the not yet been made thoroughly to realize the call made upon them is evidenced by the results fact that the success or failure of the war—in which have been achieved in a year which will brief, the fate of the country—lies in their forever be a memorable one. Under the leader- hands. In the great work of educating the ship of the Secretary of the Treasury the banks people of the country to an appreciation of have done their duty admirably in placing both their part in the effective conduct of the war the short and long term securities of the Govern- the banks of the country have an opportunity ment. As long as the war lasts their services in to make themselves leaders. In the communithese directions will doubtless have to be relied ties they serve they should endeavor to make upon in the future as much as in the past. But it clear that the amount of goods.that can be l Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN. JANUARY 1, 1918. produced, even in a country as large and as every dangerous tendency in the banking rich as ours, is limited; that saving, there- situation under control and particularly to refore, is necessary and that by saving goods the tard the too rapid expansion of banking credit, people are serving their country in four ways: as far as this can be done without jeopardizing (1) They enable our own Government and the main business of the country at this time— our allied Governments to obtain the goods the winning of the war. required with the requisite speed. As every- Events are, however, every day making it body knows, time is a most important factor at clearer that the conservation of our financial this juncture. Coal, copper, steel, and food- strength is not "of itself sufficient to insure the stuffs are cases in point. successful financing of the war. The financing (2) By saving goods not required by the of the war is only in part a money problem; Government they release corresponding quan- in very large part it is an economic problem—a tities for export to other countries, in ex- problem of conserving the economic as well as change for which needed supplies may be the financial strength of the Nation and developsecured. To illustrate: If everybody in the ing our resources and productive power to the United States would cut down consumption point where they will be equal to sustain the of cotton and woolen goods, even to a slight great military operations which are in prospect amount, goods to the value of millions of dol- and all that is incident to them. lars would be available for export and could be '• Nobody should, therefore, consume goods exmade the basis of exchange to pay for much- cept to the extent that their consumption is needed supplies of copper and nitrates for our- .necessary to maintain health, and vigor. selves and beef and wheat for the use of our Nobody should draw upon the credit reallies obtained in South America. sources of the country except to finance trans- (3) By consuming goods in smaller amounts actions which are essential for a nation at war. not only arc goods saved but money is saved, Credit should be saved as much as goods. and the people thus put in a position to absorb Conservation of credit as regards nonessential and pay for the war loans of the Government enterprises is necessary in order to provide, out of savings. without undue expansion, the credit required (4) By diminishing the consumption of by the Government and by business essential goods and by paying for Government bonds to the success of the war and the well-being out of savings instead of from funds borrowed of the country. from the banks both the rapid rise of prices * The Board most earnestly invites serious of goods is retarded as well as banking infla- consideration of these and kindred steps in the tion, which accelerates the rise of prices. development of a program of national economy It can not have escaped the attention of the and bespeaks the cooperation of all the banks banks that, since the beginning of the war, de- of the country in behalf of their adoption in posits have increased at a rapid rate and that their several communities. The banks are loans, discounts, and investments have grown urged to teach in their districts the meaning at an even more rapid rate. It is true that the and necessity of saving and its relation to the Federal Reserve's holdings of gold have also successful financing of the war; to tell the city increased to a point where they are larger merchant and the country storekeeper that this than those of any other country, but the per- is not the time to buy and stock up, especially centage of the gold reserves against deposits with luxuries. Let the people everywhere be and notes has decreased. This is a familiar encouraged to consume fewer things and let phenomenon in time of war and to a certain those be the simple and substantial things that extent perhaps unavoidable, but it must are necessary to health and strength. Let the nevertheless be our constant concern to keep public realize that it is more respectable in such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESEKVE BULLETIN. war times as confront us to be seen in old clothes will depend largely upon the strength and than in new ones.f? Let the banks tell the people staying power of the Federal Reserve Banks," of their communities and their authorities, the a nd urged the importance of developing to the mayors and governors, that this is not the time | m aximum degree our banking power, and of for cities to be spending money on public | providing financial machinery adequate for the works; rather should they be considering the j very great financial requirements imposed upon suspension [of existing work with the view ofj our country by reason of the war. He pointed releasing men and material for the use of the| out that all banks should cooperate in strength- Government and so as not to compete with | ening the reserves of the Federal Reserve Systhe Government for the savings of the people, tem, thereby enlarging the Nation's banking thereby weakening the ability of the Govern- power. The reserve requirements in a few ment to place its loans. States practically prohibit the cooperation of ' There is neither an unlimited supply of men State banks and trust companies with the or of goods or of credit. This is therefore the Federal Reserve System, and make it impossitime for both large and small enterprises, not ble for them to exchange their Federal Reserve engaged in the production or handling of es- notes for gold, and the Board would urge State sentials, to reduce inventories and thereby free banking institutions in these States to endeavor goods and productive power and banking credit to o btain such legislative action as will enable for essential uses. them to discharge what the President has Gigantic operations of the Government will termed a "solemn obligation/' In those States cause a further growth of bank deposits and where the legislatures do not meet for a year loans. Our credit structure should therefore or more, the banks might well petition their be strengthened as far as possible, and to this governors to call a special session of the legisend the banks should bend their efforts toward lature. No State can afford not to do its full three things: duty at this time in helping the national cause. (1) Absorption of Government loans by The Board therefore ventures to call upon savings; the banks, member and nonmember, each in (2) Conservation of credit for public and its community, to join in promoting and carryother essential uses with curtailment to non- ing on a campaign of education along the lines essential enterprises; and which have been indicated, confident that it (3). Increase of the gold holdings of the Fed- may count upon their willing and effective eral Reserve Banks so as to maintain an ade- cooperation. , quate basis for our growing credit structure. The outstanding feature of the year has been The latter result can be achieved if the banks the financing of the Treasury and the public, like those of England and Growth of system. s of Departmeat with its issue France—and Germ any as well—unite in a de- nearly $6,000,000,000 in bonds and in shorttermined effort to concentrate gold and gold term certificates issued in anticipation of the certificates with the Federal Reserve Banks, sale of these bonds. The Federal Reserve using Federal Keserve notes instead for general Banks, whose fiscal functions had previously circulation. formed only a minor element in their duties, Yv"e must look to the future, and prepare have found one of their chief responsibilities unceasingly for further demands which may be in the management of Government deposits made upon us. The President of the United and in placing United States securities. By States, in a statement issued on October 13, the act of June 21, 1917, Congress changed called attention to the fact that "the extent the relation of the Federal Reserve system to which our country can withstand the finan- to the member banks, and altered in an imcial strains for which!we|must be prepared, portant degree the status of the Federal Re* Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDEBAL BESERVE BULLETIN. JANUARY 1, 1918. serve note. These changes have given to the same as those governing the first sale of these Federal Reserve Banks a broader scope and certificates which occurred during the latter larger capacity to accommodate the Govern- part of November. The issue accordingly ment and the member banks dependent upon bears interest at the rate of 4 per cent, and the them. Important accessions to the member- purchase price is payable between January 2 ship of the system, bringing within its scope and January 15, the certificates themselves approximately 75 per cent of the liquid bank _ maturing on June 25, 1918. It is expected to ing resources of the Nation, have been the leave the offer open for some time in order to result of a general feeling of need for unity of enable the Federal Reserve Banks widely and action, as well as of recognition of the more properly to distribute these securities. liberal conditions of membership offered by the The Board has pointed out to Reserve Banks amendatory act in question. Thus has been that to attain the results contemplated in this brought to a successful conclusion the plan of instance, special efforts must be made to reach uniting into a compact organization the banks the taxpayer, both large and small, who wishes of the whole country. In consequence of its to anticipate or spread paymei^ts due in June. largely increased activity in dealing both with The certificates can not be used in payment of the Government and its member banks, the future Liberty Loan installments, and they are Federal Reserve System shows a marked not designed ultimately as an investment for growth in its earnings. Its holdings of gold banks. While the Treasury seeks through have greatly increased, reaching a maximum these issues to raise money and welcomes subof $1,671,133,000 on December 28, wh ile scriptions from other than taxpayers, the ultiits liabilities have grown more than propor- mate object of the issue is to relieve the contionately, leaving the reserve percentage at gestion of the money market which would ensue the close of the year at 63.6 per cent against if approximately two billions of tax payments notes and deposits. As compared with De- were made by the tax payers in June. Thebanks cember 29,1916, the gold reserves on December have been advised that it is of great importance, 28, 1917, have increased by the sum of 93 4.9 therefore, that the largest possible number of millions and the free gold—over and above the taxpayers be reached and encouraged to purtotal required reserves—has increased 300 mil- chase the certificates maturing June 25, and lions. The problems which must be faced b y that a vigorous effort be made not only to place the system in common with the whole banking I these certificates in the first instance as far as and financial community of the Nation during ) possible among taxpayers, but to the extent the year 1918 are many and serious, but the | that they and the similar certificates dated Nosystem has shown itself esqual to its respon- i vember 30 are in the first instance subscribed for sibilities, and has furnished a means of bring- | by banks and other than taxpayers, to continue ing about a coordiantion and unity in American \ the process of education with a view to obtainbanking heretofore unknown. I ing a large secondary distribution among tax- A second issue of Treasury certificates of | payers. indebtedness, intended prima- | It has been further suggested to Federal j Reserve Banks that, with the foregoing purpayers, was announced by the | poses in mind, they should consider the advisa- Secretary of the Treasury on December 15, the | bility of creating a small special organization conditions of issue being substantially the I whose efforts should be devoted entirely or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL KE3EEVE BULLETIN, primarily to the work of distributing these particular certificates. The success of the first sale has already been described in the December issue of the Bulletin, the first block of certifi- 11 cates providing for some $691,622,000. During the month $1,197,013,000 of certificates of in- District No. I—Boston: debtedness were paid off and the second install- Class A—T. P. Beai, Boston, Mass 74 Class B—Chas. A. Morss, Boston, Mass 73 ment on account of the second Liberty loan, District No. 2-New York: Class A—Robert H. Treman, Ithaca, N. Y... 79 due on December 15, was paid at the Federal Class B-Wm. B. Thompson, Yonkers, N. Y. District No. 3-Philadelphia: Reserve Banks, $597,614,026 being received on Class A—Jos. Wayne, jr., Philadelphia, Pa.... 142 Class B-Edwin S. Stuart, Philadelphia, Pa.. 70 that account, All Government deposits made District No. 4—Cleveland: Class A—Robt. Wardrop, Pittsburgh, Pa 184 against "payments by credit" by subscribing Class B—Thos. A. Combs, Lexington, Ky 173 District No. 5—Richmond: banks on account of Liberty loan subscriptions Class A—Edwin Mann, Bluefield, W. Va 60 Class B—D. R. Coker, Hartsville, S. C 100 were called and paid during the month. District No. 6-Atlanta: Class A—P. R. Kittles, Sylvania, Ga 42 The annual election of directors whose terms Class B—Edgar B. Stern, New Orleans, La District No. 7—Chicago: expire on December 31. 1917, Class A—E. L. Johnson, Waterloo, Iowa... 73 Election of di- has been held by the various Dist C ri l c a t s s N B o — . 8 M — . S B t. . L H o u u t i c s h : ison, Ottumwa, Iowa 85 rectors. Class A-Walker Hill, St. Louis, Mo 68 Federal Reserve Banks, while Class B—Le Roy Percy, Greenville, Miss... District No. 9—Minneapolis: the Board has selected Class C directors in those Class A—L. B. Hanna, Fargo, N. Dak 52 Class B—Norman B. Holter, Helena, Mont cases where the terms of the present incumbents District No. 10—Kansas City: Class A—C. E. Burnham, Norfolk, Nebr.. 322 64 expire with the close of the year. Very few Class B—H. W. Gibson, Muskogee, O kla.., 3 i 322 64 District No. 11-Dallas: changes have taken place except in cases where Class A—E. K. Smith, Shreveport, La 27 Class B~J. J. Culbertson, Paris, Tex 15 change of occupation, or other similar conditions, District No. 12—San Francisco: Class A—J. E. Fishburn, Los Angeles, Cal have rendered existing holders of directorships Class B—A. B. C. Dohrmann, San Francisco, Cal SO ineligible for continuance. The only change among Federal Reserve Agents is at the Federal Earnings of Federal Reserve Banks have Reserve Bank of Kansas City, where Mr. Asa been heavy in 1917. At the E. Ramsay has succeeded Mr. Charles M. Saw- Earnings and end of the year 1916 the twelve dividends. yer. In San Francisco Mr. James K. Lynch, Federal Reserve Banks together formerly a director, has become governor of showed aggregate arrears in dividends of about the Federal Reserve Bank of San Francisco, $3,649,000 on an estimated total average and Mr. Charles A. Morss has succeeded Mr. capital of $54,462,000, or about thirteen Alfred L. Aiken as governor of the Federal months' arrears for the twelve banks. At the Reserve Bank of Boston. One or two vacan- end of this year back dividends amounted to cies still remain to be filled. In general, the only $805,000 on an estimated total average striking feature of the outcome in the selection capital of $62,002,000, or about two and oneof directors of Classes A and B (chosen by the half months' arrears for the twelve banks. member banks) has been the failure of the Dividends have been declared by all Federal members to participate as actively as might Reserve Banks. Eight banks have paid their reasonably have been expected in the process dividends to the end of the year 1917. The of choosing directors. The following table four remaining banks have paid all dividends shows the names of the directors elected by the to June 30, 1917, so that arrears still to be paid banks, the number of banks authorized to cast under the cumulative requirements of the law ballots, and the number of banks actually are now quite small. The dividends thus auvoting: thorized at the several banks, and the dates to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN. JANUARY 1,1918. which in each case dividends have been paid, shall be paid into a surplus fund until it shall are stated in the following table: amount to 40 per centum of the paid-in capital stock of each bank.7' In the event of the Total liquidation of a Federal Reserve Bank, the amount Bank. From— To- Rate. of divi- surplus thus accumulated becomes the property dends. of the United States, subject, of course, to such Per cent. losses or deficiencies as may occur during the Boston Jan. 1,1916 Dee. 31,1917 6 8597,829 New York Jan. 1,1916 Dec. 31,1917 6 1,466,720 operation of the banks and which in ordinary Philadelphia Jan. 1,1916 June 30,1917 6 466,768 Cleveland Jan. 1,1916 June 30,1917 6 539,805 corporation accounting would be a charge Richmond July 1,1917 Dec. 31,1917 6 105,254 Atlanta Jan. 1,1917 Dec. 31,1917 6 145,465 against an undivided profit and loss account. Chicago Julv 1,1916 Dec. 31,1917 6 1660,000 St. Louis Jan. 1,1916 Dec. 31,1916 6 H67,000 Theoretically, therefore, the $1,000,000 paid Minneapolis July 1,1916 Dec. 31,1917 6 1220,000 Kansas City July 1,1916 June 30,1917 6 183,513 into the Treasury by the Federal Reserve Dallas Nov. 1,1916 June 30,1917 6 U10,000 San Francisco Oct. 1,1915 Dec. 31,1916 6 1295,000 Board is only one-half of the actual earnings derived by the Government, since it retains i Estimate. a contingent claim upon the assets of Federal There never was any reason to doubt that, Reserve Banks to an equal amount. The in due time, with even a normal volume of ; sum actually paid in, may, under provision business, it would be possible for the banks, of law, be used to supplement the gold reif wisely and economically managed, to pay serves held against outstanding United States their dividends in full and earn in addition a notes, or may be applied to the reduction considerable surplus. The first two and a of the outstanding bonded indebtedness of half years of the system's life were exceptional, the Government at the discretion of the because of the abundance of the member Secretary of the Treasury. While the success banks' lending power due to the change in or failure of the Federal Reserve Banks or the reserve requirements and to the great increase value of their services must never be judged of gold in the country resulting from our heavy by their earnings, it is gratifying to state that favorable balance of trade. It may reasonably at this time they are adding to the national be expected that from this time on the facilities strength not merely through service and the of the reserve banks will normally be called upon more extensively, even without the conservation of banking resources, but through added stimulus produced by the present great these direct contributions from earnings. volume of operations on Government account. With the arrears of the cumulative dividends practically disposed of, another year of activity Judged from the point of view of earning equal to the last may be expected to provide capacity, one of the most satisfactory aspects a corresponding increase in the volume of of the operations of the Federal surplus earnings. It should be borne in mind Reserve Banks durinS the Past that the amount now paid to the United States year is the fact that the Federal has been arrived at after making all allowances Reserve Board was able on their behalf to from the earnings of Federal Reserve Banks pay into the Treasury in round figures $1,000,000 of surplus earnings. This has been from the beginning for operating expenses, done under the provisions of section 7 of the depreciation, and other proper allowances. Federal Reserve Act, which specifies that The Federal Reserve Act differs from the after the cumulative dividend claims have charters of most foreign central banking inbeen fully met, "all the net earnings shall stitutions in that it names no specific annual be paid to the United States as a franchise franchise tax, but provides first for the paytax, except that one-half of such earnings ment of dividends to the stockholding banks Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUAEY 1,1918. FEDERAL RESERVE BULLETIN. at a moderate rate of return, leaving the excess Minor changes in the schedule of discount of earnings, whatever it may be, for the Gov- rates, published in the last isernment. Reriassiflca- sue of the Bulletin, have been tion of discount -, -, ,, , •, « -^ On December 21 the Federal Reserve Bank „„. made during the month ot De- . of New York adopted a general , langes in i j its discount rates of cember. These in practically ncrease n discount rates. all cases have been for the purpose of standabout one-half of 1 per cent, ardizing and harmonizing the rates now prevathereby bringing its schedule into line with lent at the various banks. The revised schedthose of other Federal Reserve Banks as an- ules are published on page 66 of this issue. As nounced in the Bulletin for November. It there set forth the comparative schedule shows was held desirable to delay this action until greater uniformity in the rates established by after December 15 owing to the heavy pay- the 11 banks which have acted than has exments on Liberty Loan account to be made isted heretofore. It has been the desire of the during the first halt of December, the with- Board to simplify the rate schedule and the drawal by the Treasury of the large amounts means of acting upon changes in rates. There on deposit against payments on credit on are now only two schedules for 15-day paper, Liberty Loan bonds, the vast shifting of funds one for commercial paper and collateral notes in connection with the payment of maturing secured by commercial paper (including comcertificates of indebtedness, all of which were modity paper and trade acceptances) and the expected to cause increasing demand for ac- other for collateral notes and customers7 paper commodation at metropolitan banks. This secured by Government securities. Heretofore moderate increase in rates was not expected there were four rates, as some banks charged to have a far-reaching direct effect upon the a different rate for a note secured by commercommercial rate of interest in the community, cial paper than for 15-day commercial paper but serves a valuable purpose as an indica- discounted, and some had a rate one-half per tion of policy, besides occupying a place of cent higher for member banks' customers7 notes significance in connection with the handling of secured by Government securities than for a accommodations based on Government obligacollateral note secured in the same way. Some tions. The process of completing the Decembanks had a special quotation for the 15-day ber payments on the second Liberty Loan has trade acceptance. imposed heavy responsibilities upon the banks The 15-day rate for commodity paper reof the eastern seaboard particularly, and it has mains merged with the 15-day rate for combeen a satisfaction to know that the Federal mercial paper, even though a special rate for Reserve System has again proved its worth by longer time commodity paper may later be esaffording machinery through which the Federal tablished. Fifteen-day trade acceptances will Reserve Board has been able to equalize bankbe taken under whichever classification may be ing resources. This end has been accomplished the lower. If one of the banks has a trade in part through the redistribution of acceptanacceptance rate of 3-J per cent for 1 to 60 days, ces among the several banks, and through the and a 15-day commercial paper rate of 4 per undertaking of inter-reserve bank rediscounts, cent, 15-day trade acceptances will accordingly as authorized by section 10 of the act. The be taken by that bank at 3| per cent. If, at result has been to maintain an even and steady another bank, the rate be 3 J per cent for trade apportionment of reserve funds throughout the acceptances from 1 to 60 days and 3 per cent country and to avoid, as in the past, any relafor 15-day commercial paper, the trade accepttive shortage of accommodation or any disturbance would in that case be taken at the comance of the financial market due to public mercial paper rate of 3 per cent. The Board financing. holds the view that when commercial paper or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN. JANUARY 1, 1913. trade acceptances have run down to 15 days, to aggregate cash in vault plus amounts due the difference in classification is not of sufficient from legal depositaries, including Federal importance to warrant a special quotation. Reserve Banks, which had risen from 19.4 Between November 23 and December 21 the per cent to about 20 per cent for the first 59 New York Clearing House three weeks in December, declined to 18.8 per General Reserve banks reported a reduction of cent for the week ending December 21, this position. $481,752,000 in average weekly decline apparently reflecting the large withloans and investments as against a gain of drawal of Government deposits preceding the $88,072,000 in average demand deposits and redemption of over 500 millions of certificates practically no change in average legal re- of indebtedness presented on December 15 at serves. Their average Government deposits the New York bank. For those clearing-house fluctuated between $871,102,000 for the week banks which are members of the Federal Reserve ending November 23 and $966,010,000 for the System a similar course is shown, their reserve week ending December 7. Large withdrawals percentage, figured on the basis of average weekduring the subsequent two weeks reduced the ly balances due from the Federal Reserve Bank average aggregate Government balances with only (exclusive of vault cash), rising from 16 these banks to $427,347,000 for the week end- per cent for the week ending November 23 to ing December 22. The average excess of loans 16.8 per cent for the week ending December 7, and investments over total, including Govern- but declining to 15.6 per cent for the week folment deposits, which stood at $396,274,000 for lowing. Figured on the same basis the actual the week ending November 23, has gone down reserve percentage of the 54 member banks in to $233,709,000 for the corresponding week in New York City reporting to the Board shows December, indicating substantial liquidation an increase from 15.5 for December 7 to 17 on of investments, largely Government securities. December 14 and a decline to 15.5 on Decem- Considerable decreases in the loan and invest- ber 21. ment account are shown for the week ending For the trust companies in Greater New December 14 and more particularly for the sub- York reserve percentages as figured by the sequent weeks following the redemption by the State Banking Department stood at 23 per cent Government on December 6, 11, and 15 of for the week ending December 7 as against outstanding certificates of indebtedness of the 21.8 per cent for the initial week in November. September 17, September 26, and October 24 Since then the percentage declined to 22.8 for issues. On December 15 payment of the the week ending December 14 and to 20.8 for second installment on the second Liberty Loan the week ending December 21, figures for the was due, while on the same date the Govern- latter week indicating decreases since December ment made the first interest payment on the 7 of $234,981,000 in combined loans and investfirst Liberty Loan. ments and of $237,262,000 in aggregate de- As the result of these operations combined posits. average figures of vault cash and legal bank According to the weekly statements of the reserves of all the 59 clearing-house banks, Boston Clearing House average loans and inwhich between November 23 and December vestments of its 11 member banks show a con- 14 had increased by $48,881,000, show a de- tinuous reduction from $520,693,000 for the cline for the following week of $53,718,000 week ending November 24 to $488,988,000 for while average demand deposits for the week the week ending December 22, while average ending December 21 fell below the average deposits (including Government deposits, but shown for the initial week in November. The excluding bank deposits) declined during the reserve percentage for all clearing-house banks, same period from $456,261,000 to $387,218,000. representing the ratio of net demand deposits The ratio of average deposits, as above shown, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1, 1918. FEDERAL RESERVE BULLETIN. to item "Cash in bank and in Federal Keserve when a record total of?$756,398,000 is shown, Bank'7 shows an increase from 12.9 for the has been only $62,948,000, or considerably less week ending November 24 to 14.4 for the week than the decrease shown in the holdings of ending December 22. collateral notes. Acceptances are likewise Similar reductions in aggregate loans and held in larger volume than at the end of the investments from $617,952,000 for the week previous month, the total amount given for ending November 24 to $577,825,000 for the December 21, $277,943,000, being the largest week ending December 22, are indicated for on record arid comprising in all probability the 34 members of the Philadelphia Clearing the greater part of bank and foreign trade ac- House. Government deposits show an even ceptances outstanding. A relatively large inlarger decline from $77,903,000 to $22,289,000 crease is noted in the holdings of customers' for the same weeks. For the members of the paper secured by war loan securities, the total Federal Keserve System the reserve percentage, shown for December 21 being $142,602,000, as representing the ratio of reserve with Federal against $93,657,000 at the end of November. Reserve Bank to net demand deposits shows a Favorable discount rates, taken, in conjuncdecline from 12.3 per cent for the week ending tion with a "buy-and-borrow" campaign, November 26 to 11.2 per cent for the week end- which was widely fostered in all districts, ing December 22. was largely responsible for this growth, the Liquidation on a large scale of member whole movement, moreover, being assisted by Condition of Fed- banks' collateral notes, cs- the certain knowledge that any district could eral Reserve pecially notes secured by Lib- count upon temporary accommodation of the ancs. ^y | j j tificates of reserves of other districts through the provi- )on(s an( cer indebtedness, is the outstanding feature of sions of the Federal Reserve Act which under recent developments in the field of Federal the direction of the Board permits one Federal Reserve banking. During the first half of Reserve Bank to rediscount for another. December the Government redeemed large The exercise of this function enabled the Board amounts of outstanding certificates of indebted- to equalize the holdings between Federal ness issued in anticipation of payments due on Reserve Banks. During the last month the Liberty Loan subscriptions and used as prin- Board in the exercise of its power was able cipal collateral for member banks7 notes. speedily and effectively to equalize reserves Between November 30 and December 21 the among Federal Reserve Banks, thus proving holdings by the Federal Reserve Banks of notes the wisdom and utility of one of the basic protected by war loan securities decreased principles of the Federal Reserve Act. from $405,608,000 to $146,819,000, this reduc- Investments of the Federal Reserve Banks tion being due in a large measure to the redemp- in United States bonds decreased from tion of the securities underlying the discounted $53,962,000 to $50,458,000, as the result of liquipaper. Another factor which accounts prob- dation of Liberty bonds held by certain banks ably for some reduction in the amounts of col- pending final adjustment of their Liberty loan lateral notes held by the reserve banks is the accounts. No material change is shown in the provision in the war revenue act of October total of short-term United States securities on 3, effective December 1, which imposes a tax hand, the reserve banks' purchases of certifiof 2 cents per 100 dollars or any fractional part cates of indebtedness being on the whole modthereof on promissory notes (held to include erate in volume, of a temporary character and collateral notes tendered for discount by mem- for the exclusive purpose of accommodating ber banks to their Federal Reserve Banks). member banks. Other classes of discounts show substantial During the period under review the banks7 increases with the result that the decrease in gold reserves increased from $1,604,704,000 to total discounts on hand since November 23, $1,645,543,000, while the ratio of their total Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

10 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. reserves to combined deposit and note liabili- For the four weeks ending December 14 the ties decreased from 64,7 to 62.9 per cent. net outward movement of gold Gold imports In the following table are shown the changes | totaled $3,426,000, compared and exports, between November 23 and December 21 in the j with $4,101,000 for the five totals of discounted and purchased bills held jweeks immediately preceding. Since April 6 by each of the Federal Eeserve Banks, also Iof the present year the net outward gold changes in the aggregates of other classes of!movement totaled $78,041,000, or at a weekly earning assets: rate of $2,168,000, as against a weekly average [000 omitted.] of about $856,000 for the four weeks ending December 14. Gold imports for these four Federal Reserve Bank. Nov. 23. Dec. 21. inc N re e a t se. dec N re e a t se. weeks, totaling $2,702,000, are credited largely to Mexico, Canada, South America, and the Boston 867,808 $70,158 $2,350 Dutch East Indies, while gold exports, totaling New York 401,451 397,450 $4,001 Philadelphia 48,518 65,331 16,813 $6,128,000, were consigned largely to Chile and Cleveland 61,231 77,921 16,690 Richmor1^ . . 29,560 44,644 15,084 Mexico. Since January 1 of the present year Atlanta 17,380 23,765 6,385 Chicago... 103,754 116,194 12,440 the country's stock of gold increased through St. Louis 25,120 47,897 22,777 MiTunp-apolis 19,306 23,050 3,744 net imports by $183,906,000, while the gain Kansas City 37,658 35,356 2,302 Dallas . 19,193 25,157 5,964 since August 1,1914, is given as $1,052,668,000, Pan Francisco -, ! 34,928 44,529 9,601 as shown in the following exhibit: Total bills 865,907 971,452 105,545 Total United States securities. 111,812 108,568 3,244 [000's omitted.] Total municipal warrants 1,422 1,102 320 Total investments held. 979,141 1,081,122 101,981 Excess of im- Imports. Exports. ports over Further progress has been made during the exports. past month in the development New branches of the Board's policy with re- Aug. 1 to Dec. 31,1914. $23,253 $104,972 i $81,719 and offices. Jan. 1 to Dec. 31,1915.. 451,955 31,426 420,529 spect to the establishment of Jan. 1 to Dec. 31,1916.. 685,745 155,793 529,952 Jan. 1 to Dec. 14,1917.. 552,417 368,511 183,906 branches. Shortly after the opening of the Total.. 1,713,370 660,702 1,052,668 new year there will have been established branches of Federal Reserve Banks at New i Excess of exports over imports. Orleans, Seattle, Portland, Spokane, Louis- A further change in methods of administering ville, Cincinnati, Pittsburgh, Detroit, and Bal- the present regulations as to the shipment of timore. Of these, all except the three last precious metals has occurred during the month. named are already in operation. Further Control of all applications for the exportation modifications of a minor character have been of manufactures of gold or silver when the made in the standard draft of by-laws suggested metal value of the article shipped is distinctly for use at branches, these changes being in- small as compared with the cost of labor or of ; tended to adapt the by-laws more closely to other material employed in its production has ; local conditions. The general fact, already been transferred to the War Trade Board, the I noted in former issues of the Bulletin, remains— Federal Eeserve Board confining its attention namely, the recognition of two distinct types to applications for shipment of coin, or fine of branches, the one possessing an assigned bullion. The reexportation of gold imported territory and segregated capital, the other and into the United States with the expectation of later type, providing for a clientele consisting reshipment is being in general forbidden, of banks which have voluntarily chosen to except in those cases where the gold is returned transact their business with the branch rather to the country from which it came. This than with the parent office. permits gold to continue to leave the United Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

•lANUAHY 1, 1918. FEDERAL BESERVE BULLETIN. 11 States for countries which have shipped it on behalf of an "enemy" or "ally of enemy," here for refining with the understanding that or drawn by or to the order of such a person, the refined proceeds of such shipment will or on which such person appears as indorser, come back to them. It, however, cuts off unless a license is first obtained from the Bureau dealings in gold which have in the past been of Enemy Trade. The War Trade Board has undertaken to some extent for the purpose of authorized the payment of travelers7 checks, reexporting coin at a profit to other countries. not exceeding $100 in amount, on which there The movement of silver out of the country appears the indorsement of a person who is has been heavy, indications being that in a an "enemy" or "ally of enemy," or acting variety of cases it has been substituted for for or on behalf of an "enemy" or "ally of gold in the liquidation of international balances. enemy," without obtaining a license therefor. No system for the definite regulation of The Board notified Federal Reserve Banks foreign exchange has been ap- of the action thus taken and requested thorn to Foreign ex- ii dmi the month of notify member banks accordingly. change regula- p£ ed ng & . tions. December, pending the issuance of an Executive order designed Acceptance Liabilities of American Banking to carry into effect the executive powers Institutions. granted by Congress for that purpose. In view of the numerous problems now coming before In continuation of similar figures shown on the Board with reference to foreign exchange page 664 of the September, 1917, Bulletin and the probability of an enlargement of its there are presented below summary data of acceptance liabilities of national banks responsibilities in this regard, the Board has in principal cities, supplemented by like appointed Mr. F. I. Kent as foreign exchange data for State banks and trust companies in adviser, Mr. Kent being for this purpose granted New York, Boston, Baltimore, and St. Louis. leave of absence by the Bankers Trust Co. of Between June and September there was ap- New York, of which he is a vice president. parently a slight decrease in the amounts of It was announced on December 14 that the War acceptances outstanding, the New York banks Trade Board had authorized the payment of and trust companies, particularly, reporting drafts accepted on or before December 14, decreases in their acceptance liabilities for the 1917, drawn on funds to the credit of a person latter date. November figures for the New who is an "enemy" or "ally of enemy," or York banks and trust companies show but acting for or on behalf of an "enemy" or little change from figures for the earlier dates. "ally of enemy," or on which such a person appears as drawer or indorser, when such Between September 9 and November 23, the Fridays nearest the dates of the Comptroller's drafts are presented for payment in the United calls, the Federal Reserve Banks increased States, provided that when such drafts are their holdings of acceptances from $173,199,000 collected for or on behalf of any person who to $209,905,000. Further increases are shown is an "enemy" or "ally of enemy" or person for the more recent dates, the holdings on acting for or on behalf of an "enemy" or December 21 being $277,943,000. It is "ally of enemy," the proceeds of collection be evident, therefore, that increasing amounts of at once reported by the person making such acceptances have been finding their way into collection to and be held subject to the disthe portfolios of the Federal Reserve Banks position of the Alien Property Custodian. No in addition to the substantial amounts of acdrafts can be accepted, or transferred or ceptances purchased or discounted by acceptdealt in before acceptance, which are drawn ing institutions and reported with their other on funds to the credit of any person who is an loans and discounts. "enemy" or "ally of enemy," or acting for or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 FEBEBAL EESERVE BULLETIN. JANUARY 1,1918. Acceptance liabilities of American hanking institutions. and on January 4 paid into the Treasury of the United States as a franchise tax the sum [In thousands of dollars; i. e., 000 omitted.] of $1,134,234.48, the amounts being paid by June 20, Sept., Nov., the banks as follows: Boston, $75,100; New 1917. 1917. 1917. York, $649,363.57; Chicago, $215,799.18; At- AH national banks 144,414 l t138,231 lanta, $40,000; Richmond, $116,471.73; Min- Trust companies in State of New York: Greater New York 94,485 3 90,452 4 97,188| neapolis, $37,500. These banks have also Outside Greater New York 3 973 «1,080 established on their books a surplus fund in State banks in State of New York: Greater New York 5,957 3 7,025 4 5,767 amounts equal to the sums paid the Govern- Outside Greater New York 3 331 U6 Trust companies and State banks: ment. In Boston 16,979 6 17,544 16,370 In St. Louis 60 6 916 7 1,867 In Baltimore , 1,765 1285 2 70 Total., 255,757 Fiduciary Powers for National Banks. 1 Sept. 11. 3 Sept. 8. 6 Sept. 6. ? Nov. 29. The following opinion, rendered by the 2 Nov. 20. 4 Nov. 14. «Sept. 21. Attorney General of the United States, passes Acceptance liabilities of national banks in principal cities upon the power of the Federal Reserve Board of the United States on specified dates. to grant to national banks the power to exer- [In thousands of dollars; i. e. 000 omitted. ] cise fiduciary powers: NOVEMBER 26, 1917. June 20, Bpt. 11, Nov. 20, 1917. 1917. 1917. SIR: I have your letter dated November 16, 1917, with reference to the authority of the New York 79,473 72,717 Federal Reserve Board to grant to national Boston 30,681 31,873 Philadelphia... 8,513 9,649 7,462 banks located in New York the power to act Cleveland 1,494 535 as trustee, executor, and administrator. I am Cincinnati 1,578 751 Baltimore 1,966 568 of opinion that the Reserve Board has no such New Orleans... 1,394 465 Charleston, S. C 660 137 authority under existing laws. Chicago 3,357 5,554 Section 11 (k) of the Federal Reserve Act Minneapolis 1,468 991 San Francisco.. 5,646 5,008 of December 23, 1913, c. 6, empowers the Another 8,184 Reserve Board— Total 144,414 138,231 SEC. 11 (k). To grant by special permit to national banks applying therefor, when not in contravention of State or local law, the right to act as trustee, executor, adminis- Excess Profits Paid Into Treasury. trator, or registrar of stocks and bonds under such rules and regulations as the said Board may prescribe. (38 Stat. The law requires that the Federal Reserve 251, 262.) Banks, after paying all necessary expenses, The congressional enactment therefore authorizes the special permit only "when not together with 6 per cent cumulative dividends in contravention of State or local laws." to their stockholders, shall carry one-half of The act of April 16, 1914, Article V, secexcess profits remaining to their surplus -fund tion 223, Laws of New York, 1914, c. 369, until the surplus amounts to 40 per cent of the p. 1371, provides: capital, and shall pay the other half of excess No corporation other than a trust company organized under the laws of this State shall have or exercise in this profits to the United States Government as a State the power to receive deposits of money, securities, franchise tax, the entire excess profits to be or other personal property from any person or corporation paid to the Government after the surplus of a in trust, or have or exercise in this State any of the powers specified in subdivisions one, four, five, six, seven, and Federal Reserve Bank reaches 40 per cent of eight of section one hundred eighty-five of this article, nor its capital. The Federal Reserve Banks of have or maintain an office in this State for the transaction of, or transact, directly or indirectly, any such or similar Boston, New York, Chicago, Atlanta, Rich- business, except that a Federal reserve bank may exercise mond, and Minneapolis have paid their divi- the powers conferred by subdivision one of such section if authorized so to do by the laws of the United States dends to stockholders to December 31, 1917, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL BESEEVE BULLETIN. 13 Subdivisions 1, 4, 5, 6, 7, and 8 of section 185 Liberty bond coupons. Though I realize that of Article V referred to confer authority upon the service rendered by banks and trust comtrust companies to act as registrar of stocks and panies in cashing coupons is a substantial one, bonds, as executor and administrator, and as I desire to point out that the coupons are paytrustee in various capacities. able at any Federal Keserve Bank or Sub- The laws of New York empower only trust treasury as well as at the Treasury Department companies organized under the laws of that in Washington, and that any national bank State to act as trustee, executor, and ad- which is a general depositary of Government ministrator. This is not a case where the local funds is required to cash the coupons without law simply authorizes State banks to assume charge. I am confident, also, that no bank or trust company functions. Fellows v. First trust company which is a depositary of the National Bank (192 Mich., 640). Corpora- proceeds of Liberty bonds or Treasury certifitions other than those organized in New York cates of indebtedness will make a charge for are expressly prohibited from exercising such collecting the coupons and paying the cash to powers. Since the national banks in question the holder, and it is my earnest hope that even are not organized under the laws of New York, those banks and trust companies which have a special permit to act as trustee would be not become such depositaries will perform this plainly in contravention of the State law. service without charge as a patriotic duty." I find nothing in the opinion of Mr. Chief Justice White in First National Bank v. Fellows (244 U. S. 416), which would justify, Acceptances to 100 Per Cent. in the present matter, a different construction of the unambiguous provisions of the con- Since the issue of the December Bulletin the trolling statutes. The language of the present following banks have been authorized to accept Chief Justice demonstrates the power of the drafts and bills of exchange up to 100 per cent national legislature to confer authority upon of their capital and surplus: national banks to act as trustee, executor, and administrator, where such powers are National Union Bank, Boston, Mass. exercised by State trust companies, even Columbia Trust Co., New York, N. Y. though the State law discriminates against Union Trust Co., Pittsburgh, Pa. the national agencies in this regard. The First National Bank, Richmond, Va. power of Congress to determine how far First National Bank, Hutchinson, Kans. national banks may be subject to State control Fourth National Bank, Macon. Ga. is settled, and State regulations which conflict Cleveland Trust Co., Cleveland, Ohio. with the congressional enactments are invalid. Mercantile Bank of the Americas, New York, N. Y. (Davis v. Elmira Bank, 161 U. S. 275; Easton Continental & Commercial National Bank, Chicago, 111. v. Iowa, 188 U. S. 220; Van Reed v. National Bank, 198 U. S. 554.) But in this case Congress has not exerted its power. By sec- Directors of Federal Reserve Banks. tion 11 (k) it has explicitly constituted the local statutory provisions as the criterion of The Federal Reserve Board has appointed the corporate capacity of national banks. The the following Class C directors, Federal Reserve New York statute, therefore, can not fairly Agents, and deputy chairmen of Federal Rebe said to deny to national banks operating serve Banks to fill vacancies where terms exin New York a power Congress intended they pire on December 31, 1917. Terms of directors should have. are for three years. Terms of Federal Reserve Very respectfully, Agents and deputy chairmen are for one year. T. W. GREGORY, Attorney General. The PRESIDENT. CLASS C DIRECTORS. District No. 1, Boston—Frederic H. Curtiss. District No. 2, New York—W. L. Saundera. Cashing Bond Coupons. District No. 3, Philadelphia—Richard L.Austin; Charles C. Harrison (1-year term). Secretary McAdoo on December 20 author- District No. 4, Cleveland—D. C. Wills. ized the following statement: District No. 5, Richmond—Caldwell Hardy. ''I am informed that a few banks and trust District No. 6, Atlanta—M. B. Wellborn. companies are making a charge for cashing the District No. 7, Chicago—James Simpson. 81939—18 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. District No. 8, St. Louis—John W. Boehne. District No. 2—New York: District No. 9, Minneapolis—John H. Rich. Class A—Robert H. Treman, Ithaca, N. Y. District No. 10, Kansas City—Asa E. Ramsay. Class B—Wm. B. Thompson, Yonkers, N. Y. District No. 11, Dallas—W. F. Ramsey. District No. 3—Philadelphia: District No. 12, San Francisco—John Perrin. Class A—Joseph Wayne, jr., Philadelphia, Pa. Class B—Edwin S. Stuart, Philadelphia, Pa. FEDERAL RESERVE AGENTS AND DEPUTY CHAIRMEN. District No. 4—Cleveland: District No. 1, Boston: Class A—Eobert Wardrop, Pittsburgh, Pa. Chairman and Federal Reserve Agent—Frederic H. Class B—Thos. A. Combs, Lexington, Ky. Curtiss. District No. 5—Richmond: Deputy chairman—Allen Hollis. Class A—Edwin Mann, Bluefield, W. Va. District No. 2, New York: Class B—D. K. Coker, Hartsville, S. C. Chairman and Federal Reserve Agent—Pierre Jay. District No. 6—Atlanta: Deputy chairman—George F. Peabody. Class A—P. R. Kittles, Sylvania, Ga. District No. 3, Philadelphia: Class B—Edgar B. Stern, New Orleans, La. Chairman and Federal Reserve Agent—Richard L. District No. 7—Chicago: Austin. Class A—E. L. Johnson, Waterloo, Iowa. Deputy chairman—H. B. Thompson. Class B—M. B. Hutchison, Ottumwa, Iowa. District No. 4, Cleveland: District No. 8—St. Louis: Chairman and Federal Reserve Agent—D. C. Wills. Class A—Walker Hill, St. Louis, Mo. Deputy chairman—Lyman H. Tread way. Class B—LeRoy Percy, Greenville, Miss. District No. 5, Richmond: District No. 9—Minneapolis: Chairman and Federal Reserve Agent—Caldwell Class A—L. B. Hanna, Fargo, N. Dak. Hardy. Class B—Norman B. Holter, Helena, Mont. Deputy chairman—James A. Moncure. District No. 10—Kansas City: District No. 6, Atlanta: Class A—C. E. Burnham, Norfolk, Nebr. Chairman and Federal Reserve Agent—M. B. Wellborn" Class B—H. W. Gibson, Muskogee, Okla. Deputy chairman—Edward T. Brown. District No. 11—Dallas: District No. 7, Chicago: Class A—E. K. Smith, Shreveport, La. Chairman and Federal Reserve Agent—Wm. A. Heath. Class B—J. J. Culbertson, Paris, Tex. Deputy chairman—James Simpson. District No. 12—San Francisco: District No. 8, St. Louis: Class A—J. E. Fishburn, Los Angeles, Cal. Chairman and Federal Reserve Agent—Wm. McC. Class B—A. B. C. Dohrmann, San Francisco, Cal. Martin. Deputy chairman—John W. Boehne. District No. 9, Minneapolis: Directors of Branch Banks. Chairman and Federal Reserve Agent—John H. Rich. Deputy chairman—Wm. H. Lightner. Directors of branch banks have been named, District No. 10, Kansas City: as follows: Chairman and Federal Reserve Agent—Asa E. Ramsay. CINCINNATI BRANCH. Deputy chairman—F. W. Fleming. (Federal Reserve IBank of Cleveland.) District No. 11, Dallas: Manager: L. W. Manning. Chairman and Federal Reserve Agent—W. F. Ramsey. Directors: W. S. Eowe, L. W. Manning, W. 0. Proctor. Deputy chairman—W. B. Newsome. Judson Harmon, Chas. A. Hinsch, Cincinnati, Ohio. District No. 12, San Francisco: Chairman and Federal Reserve Agent—John Perrin. DENVER BRANCH. Deputy chairman—Walton N. Moore. (Federal Reserve Bank' of Kansas City.) Manager: C. A. Burkhardt. Directors: C. C. Parks, A. C. Foster, 0. A. Burkhardt, Class A asid B Directors Elected. John Evans, Denver; Alva Adams, Pueblo, Colo. The following Class A and B directors have LOUISVILLE BRANCH. been elected by the Federal Keserve Banks for Federal Reserve Bank of St. Louis.) the 3-year term beginning January 1, 1918: Manager: W. P. Kincheloe. District No. 1—Boston Directors: George W. Norton, W. P. Kincheloe, F. M. Class A—T. P. Beal, Boston, Mass. Sackett, Louisville; W. C. Montgomery, Elizabethtown, Class B—Chas. A. Morss, Boston, Mass. Ky.; Chas. E. Hoge, Frankfort, Ky. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 15 NEW ORLEANS BRANCH. national banks during the period from Decem- (Federal Reserve Bank of Atlanta.) ber 1, 1917, to December 28, 1917, inclusive: Manager: Marcus Walker. Banks. Directors: J. E. Bouden, jr., Marcus Walker, Edgar B. New charters issued to 18 Stern, Jas. E. Zunts, New Orleans; Frank Roberts, With capital of $735,000 Lake Charles, La.; H. B. Lightcap, Jackson, Miss.; A. P. Increase of capital approved for 5 Bush, Mobile, Ala. With new capital of 200,000 OMAHA BRANCH. Aggregate number of new charters and (Federal Reserve Bank of Kansas City.) banks increasing capital 23 Manager: W. B. Hughes. With aggregate of new capital authorized 935,000 Directors: Luther Drake, J. 0. McNish, W. B. Hughes, Number of banks liquidating (other than Omaha, Nebr.; P. L. Hall, Lincoln, Nebr.; E. O. Marthose consolidating with other national nell, Nebraska City, Nebr. banks) 4 PITTSBURGH BRANCH. Capital of same banks 150,000 (Federal Reserve Bank of Cleveland.) Number of banks reducing capital 1 Manager: George DeCamp. Reduction of capital 50,000 Directors: R. B. Mellon, Chas. W. Brown, James D. Cal- Total number of banks going into liquidalery, T. H. Given, George DeCamp, Pittsburgh, Pa. tion or reducing capital (other than those consolidating with other national banks). 5 PORTLAND BRANCH. Aggregate capital reduction 200,000 (Federal Reserve Bank of San Francisco.) Manager: W. N. Ambrose, acting. The foregoing statement shows the aggregate of Directors: A. L. Mills, J. 0. Ainsworth, W. N. Ambrose. increased capital for the period of the banks embraced in statement was 935,000 Nathan Strauss, Thomas C. Burke, Portland, Oreg. Against this there was a reduction of capital SEATTLE BRANCH. owing to liquidations (other than for con- (Federal Reserve Bank of San Francisco.) solidation with other national banks) and Manager: C. J. Shepherd. reductions of capital of 200,000 Directors: M. F. Backus, N. H. Latimer, 0. J. Shepherd, Net increase 735,000 Chas. H. Clarke, Chas. E. Peabody, Seattle, Wash. SPOKANE BRANCH. Fiduciary Powers. (Federal Reserve Bank of San Francisco.) Manager: Chas. A. McLean. The applications of the following banks for Directors: E. T. Coman, D. W. Twohy, Chas. A. McLean, permission to act under section Ilk: of the Peter McGregor, G. I. Toevs, Spokane, Wash. Federal Reserve Act have been approved since the issue ot the November BULLETIN: Bonds to Protect Notes. %?$?• DISTRICT No. 1. The Comptroller of the Currency reports as i^^;^;;^:;: ' Trustee, executor, administrator, and registrar of stocks of December 12 that United States Government ^ and bonds: bonds held on November 30 last, as security for Hi Merchants National Bank, Leominster, Mass. circulating notes of national banks, amounted •3'SS? •}• DISTRICT NO. 4. to $681,565,810, having shown an increase Trustee and registrar of stocks and bonds: since March 31 of more than $17,000,000, or an Painesville National Bank, Painesville, Ohio. average increase of more than $2,000,000 per II IHiBI ii DISTRICT NO. 5. month during this period. Trustee, executor, administrator, and registrar of stocks and bonds: First National Bank, Hyattsville, Md. New National Bank Charters. DISTRICT NO. 7. The Comptroller of the Currency reports the Trustee, executor, administrator, and registrar of stocks following increases and reductions in the numand bonds: ber of national banks and the capital of First National Bank, Flint, Mich. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

16 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. DISTRICT NO. 10. State Banks and Trust Companies Admitted. Trustee, executor, administrator, and registrar of 3tocks The following list shows the State banks and bonds: and trust companies which have been admitted Farmers National Bank, Oklahoma City, Okla. to membership in the Federal Reserve System during the month of December: DISTRICT NO. 11. Trustee, executor, administrator, and registrar of stocks Capital. | Surplus. res T o o u t r a c l es. _.- .-. j and bonds: Bank of Kimberly, Kimberly, Idaho $35,000 $10,250 Royall National Bank, Palestine, Tex. Metropolitan Trust Co.,Boston, Mass. 300,000 300,000 5,787,080 The Plainfield Trust Co., Plainfield, N.J 300,000 200,000 8,749,434 The Bank of Genesee, Batavia, N. Y.. 100,000 100,000 1,151,907 American State Bank, Athens, Ga... 100,000 20,000 538,635 Commercial Failures Reported. Bank of Rosalia, Rosalia, Wash 25,000 5,000 308,777 Conrad Trust & Savings Bank, Helena, Mont 200,000 | 80,000 3,042,678 Continued reduction in the country's com- Commercial Trust Co., Philadelphia, Pa 1,000,000! 1,750,000 24,796,108 mercial mortality in comparison with recent Camden Safe Deposit & Trust Co., Camden, N. J 500,000 800,000 10,352,726 preceding years is disclosed by the failure re- Bloomfield Trust Co., Bloomfield, 200,000 100,000 3,213,787 turns, and commercial defaults for three weeks Morrill & Janes Bank, Hiawatha, Kans 100,000 50,000 1,143,410 of December, as reported to R. G. Dun & Co., German American Bank, New York City. 750,000 250,000 8,404,825 number 707, against 873 in the same period of Union Trust & Savings Bank, Flint, Mich 100,000 135,000 3,848,355 1916. The statement for November—the latest Citizens Bank & Trust Co., Tampa, Fla 250,000 580,000 3,550,995 month for which complete statistics are avail- Charles River Trust Co., Cambridge, Mass 200,000 200,000 2,893,283 able—shows fewer insolvencies than in any Butler Banking Co., Hood River, 100,000 ! 20,000 909,708 November since 1909, the number being only Nile?City Bank," NilesVMich.* [.' .*.".'; „"100,000 ; 20,000 699,175 Trust Company of Georgia, Atlanta, 981, and the liabilities of $13,635,605 are the Ga 1,000,000 ! 1,000,000 3,893,161 St. Anthony Falls Bank, Minneapsmallest for that month back to 1910. Com- polis Minn 300,000 60,000 3,763,062 Joliet Trust & Savings Bank, Joliet, paring with 1916, the November failures were 100,000 25,000 766,311 Highland Park State Bank, High-" less numerous in all of the twelve Federal land Park, Mich 1,000,000 400,000 20,976,678 Reserve districts, except the eighth, ninth, and First State Bank of Detroit, Detroit, Mich 500,000 150,000 8,275,489 eleventh, and the decreases were especially Rochester Savings Bank, Rochester, Mich 50,000 i 10,000 556,346 marked in the fifth and sixth districts. In Romeo Savings Bank, Romeo, Mich.. 50,000 30,000 1,081,181 Rahway Trust Co., Rah way, N. J 100,000 25,000 398,277 respect to the liabilities, the totals were larger Pittsburgh Trust Co, Pittsburgh, Pa. 2,000,000 1,000,000 21,067,764 Harris Trust & Savings Bank, Chithan last year in the third, sixth, eighth, and cago, 111 2,000,000 2,000,000 33,570,255 The Dime Savings Bank, Detroit, eleventh districts, but smaller in all other Mich 1,000,000 1,000,000 32,769,194 Peninsular State Bank, Detroit, instances, the falling off in the second district Mich .. 2,500,000 | 1,000,000 27,270,333 Citizens Savings Bank, Gilman, being about $1,500,000. Iowa 25,000 I 11,000 383,801 Union State Savings Bank & Trust Co., Kewanee, 111 100,000 I 25,000 1,170,562 Detroit Savings Bank, Detroit, Failures during November. Mich ? 750,000 I 750,000 19,524,470 United States Trust Co., New York, N. Y 2,000,000 12,000,000 77,455,087 Effingham State Bank, Efflngham, Number. Liabilities. 50,000 10,000 721,719 First Standard Bank *& "Trust Co.",* District. Maysville, Ky 175,000 60,000 1,418,794 1916 1917 1916 1917 H. C. McLachlen & Co. State Bank, Petersburg, Mich 25,000 5,000 362,541 State Savings Loan & Trust Co., First 145 131 $1,772,161 §1,350,120 St Q at u e inc B y a , n 1 k 1 1 of Wilbur, Wilbur, 1,000,000 8,092,397 S T e h c i o r n d d .. 22 8 5 1 19 5 8 8 5,1 8 1 2 2 8 , , 9 8 2 8 0 3 3 1 , ,8 6 6 7 0 3 , , 0 1 2 6 8 6 Gr W an a d s h Haven State Bank, Grand .'. 50,000 5,000 919,175 F F i o f u th rth 7 7 9 9 3 6 1 0 5 6 5 8 9 7 , , 2 1 5 0 6 0 3 4 1 6 2 5 , , 2 6 5 0 9 7 Fi H rs a t ve S n a , v M in i g c s h Bank, Sutherland, , 75,000 50,000 1,662,949 S Se ix ve th n . t . h 1 is 1 p 9 13 4 7 8 1 1 , , 0 9 7 8 2 9 , , 4 5 0 1 4 0 1 1 , , 5 8 2 8 9 2 , , 6 0 2 4 7 5 Bo Io ie w s a State Savings Bank, Hudson, 50,000 320,201 E N Te i i g n n h t t h h th 4 5 4 3 8 6 3 6 4 9 2 7 3 3 3 2 3 2 4 0 5 , , , 2 7 7 3 9 9 2 4 5 1,0 2 2 6 0 5 7 1 3 , , , 4 2 8 0 3 5 3 5 3 P S e e M c n u d ic r e i h r t y S ta T te ru B st a nk & , P S e a n v d i e n r g , s N e B b a r nk, 5 7 0 5 , , 0 00 0 0 0 2 3 5, , 0 0 0 0 0 0 7 4 3 0 4 3, , 0 2 3 9 6 5 E Tw le e v l e ft n h th 18 4 1 5 11 5 3 7 3 7 4 5 5 5 , , 7 8 5 2 7 9 4 6 2 1 1 8 , , 9 3 3 2 6 6 M C ad e i d s a o r n F C al o ls u , n I t o y w T a rust & Deposit 50,000 5,000 254,487 Total 1,251 981 14,104,621 13,635,605 Ea C t o o ., n O C n o e u i n d t a y , N Sa . v Y ings Bank, Char- 164,100 94,870 2,224,326 lotte, Mich 100,000 20,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUAKT 1,1918. FEDERAL RESERVE BULLETIN. 17 act for those agencies or departments of the Capital. Surplu res T o o u t r a c l es. Government; including the Federal Reserve Banks, mailing such packages, where postage Central Savings Bank, Detroit, Mich ? $500,000 $100,000 311,962,743 is to be paid thereon, Suburban Trust & Savings Bank, Oak Park, 111 100,000 10,000 379,251 Maryland Trust Co., Baltimore, Md. 1,000,000 8,974,128 Rome Trust Co., Rome, N. Y 300,000 60,000 3,627,406 Chemung Canal Trust Co., Slraira, 600,000 400,000 7,301,858 Resources of National Banks. Metropolitan Bank, Seattle, Wash... 200,000 100,000 3,559,260 American State Bank, Detroit, Mich. 500,000 185,130 7,243,617 Volusia County Bank, Deland, Fla.. 100,000 100,000 i; 217,318 The Comptroller of the Currency on Decem- Discount and Deposit State Bank, Kentland, Ind 70,000 35,000 549.592 ber 20 issued a statement as to resources of Newark Trust Co.. Newark, Ohio.... 200,000 125,000 2,655;417 City Bank, Syracuse, N. Y 500,000 148,000 7,442,110 national banks in reserve and central reserve Citizens Bank, West Point, Ga Wilmington Trust Co., Wilmington, 50,000 172,477 cities, as follows: Del... 500,000 Oceana County Savings Bank, Hart, 1,000,000 13,141,081 Mich 13,000 Statements just compiled show that the re- Commercial & Savings Bank, St. 40,000 427,901 sources of the national banks in the reserve and Clair,Mich 50,000 10,000 746,874 T O r l u d s S t t C at o e m B p a a n n k y , F of re F m u o l n to t, n M C ic o h unty, 50,000 25,000 875,831( central reserve cities of the United States at Gloversville, N. Y 200,000 100,000 527,339 the time of the last call, November 20, 1917, American Exchange Bank, amounted to 10,505 million dollars, exceeding by Milwaukee, Wis 250,000 50,000 4,721,622 The Northwestern State Bank, 1,408 million dollars the greatest resources ever Pe B n e n l s l y in l g v h an am ia , C W o a . s fo h r Insurances on 100,000 45,000 1,474,055 previously shown, and were greater than those Lives and Granting Annuities, of November 17, 1916, by 1,885 million dollars. Philadelphia, Pa 2,000,000 5,000,000 43,602,088 Kirchman State Bank, Cicero, 111... 100,000 25,000 613,746 The total deposits of the national banks in Interstate Trust & Banking Co., reserve and central reserve cities amounted on New Orleans, La 750,000 500,000 9,171,943 Lansing State Savings Bank, November 20, 1917, to 8,593 million dollars, an Lansing, Mich 150,000 | 100,000 2,632,821 Farmers State Bank, Reardan, Wash. 25,000 ! 7,500 639,855 increase over the call of September 11, 1917, of Farmers State Bank, Vail, Iowa 50,000 ; 8,000 264,040 1,087 million dollars, and an increase over May, Gladstone State Savings Bank, Gladstone, Mich 50,000 15,000 571,986 1917, the greatest heretofore reported, of 1,023 Martinsville State Bank, Martinsville.Ill 50,000 17,000 million dollars. The increase over November First State Bank, La Crosse, Wash.. 60,000 8,000 715,454 17, 1916, was 1,336 million dollars. Steubenville Bank & Trust Co., Steubenville, Ohio 125,000 50,000 1,713,784 The compilation of the country bank reports Brighton State Bank, Brighton, Iowa 50,000 10,000 672,810 has not yet been finished, but of the six States whose reports have been completed, all but one Total 28,919,100 J32,050,750 488,728,420 show materially increased deposits, including Louisiana with an increase of 15 millions, ana Two hundred and fifty Sta.te institutions North Carolina with an increase of 22 million are now members of the system, having a dollars. total capital of $229,039,800, total surplus of Loans and discounts in reserve and central $296,165,730, and total resources of $4,999,- reserve cities November 20, 1917, were 5,356 427,655. million dollars, an increase as compared with September 11, 1917, of 266 million dollars, and an increase over November 17, 1916, of 655 Tax on Parcel Post Packages. million dollars. On November 20, 1917, loans and discounts The Commissioner of Internal Revenue has in reserve and central reserve cities amounted advised the Federal Reserve Board that Fedto 51 per cent of total resources, as compared eral Reserve Banks are subject to the war with a ratio of loans and discounts to resources stamp tax imposed bv subdivision 14 of of 58 per cent on November 17, 1916. Schedule A, act of October 3, 1917, upon The increases in deposits and loans are ! largely due to transactions relating to the parcel post packages, and states that this tax / | Second Liberty Loan. applies to all packages on which postage rei The increase in deposits in the three central quired to be paid amounts to 25 cents or more. reserve cities of New York, Chicago, and St. The commissioner advises that postal authori- | Louis, as compared with September 11, 1917, ties are prohibited from transporting such was 640 million dollars, of which increase 577 • millions was in New York City. packages until a stamp or stamps representing Forty-three out of 54 reserve cities show an the tax due shall have been affixed thereto, I increase in deposits, and only 11 cities show a and that there is no exemption provided by the 1 reduction. The total increase in deposits in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 FEDERAL RESERVE BULLETIN. JANUARY 1, 1918. the 43 other reserve cities which showed in- Report of the Secretary of the Treasury. creases amounted to 477 million dollars. The Secretary of the Treasury, in his annual The reserve cities reporting an increase in report on the finances, sent to the Speaker of deposits of 10 million dollars or more were, in round figures: Boston, 94 millions; Philadel- the House of Representatives on December 3, phia 77, Pittsburgh 37, Dallas 26, San Fran- 1917, says in part: cisco 25, Richmond 17, Atlanta and Fort Worth America's entry into the European war, 14 each, Washington and Kansas City, Mo., April 6, 1917, brought the country face to 13 each, Houston and Minneapolis 12 each, face with unparalleled and unusual financial Oklahoma City 11, and New Orleans 10 million problems, both in their variety and magnitude. dollars. To these were added the inevitable accompani- Of the 11 cities showing a reduction in dement of many other problems arising out of posits the only cities in which the reduction essential economic readjustments necessitated amounted to as much as two million dollars, by the war and the transformation of an unwere: Indianapolis 9 millions, Des Moines 5, armed and peaceful Nation into a formidable Cedar Rapids and Omaha 4 each, Cleveland 3, armed combatant. Many of the familiar and Sioux City 2 millions dollars. phenomena, inseparable from such a transformation, have appeared and will continue to Paper Currency Outstanding. appear until these readjustments have been The paper currency of each denomination completed. They have caused unavoidable outstanding on November 30, 1917, was as fol- losses and hardships. Such things can no lows: more be avoided in time of war than sacrifices of blood if the rights of the Nation are to be United Treasury Federal Federal vindicated and made safe for the future and a Denominations. S no ta te te s s . notes of R n e o s t e e r s v . e b R an e k se n r o v t e es just peace is to be secured for the world. We must face these trials with philosophy, resolu- O Tw ne o d d o o l l l l a a r rs $1 1 9 8 , , 1 2 4 0 9 1 , , 3 2 1 2 3 0 $ 2 3 0 3 8 6 , , 7 2 6 3 7 8 tion, and calmness. We must see in them not Five dollars 221,174.130 8192,965,980 $3,817,425 alone the inspiration but the call to supreme Ten dollars 60,567,426 506,920 389,108,580 5,040,000 Twenty dollars 12,255,052 226,630 384,714,350 3,985,940 effort. Fifty dollars 1,300,775 9,350 72,120,400 One'hundred dollars... 2,133,600 92,100 87,435,300 When these readjustments have been com- O Fi n v e e t h h u o n u d sa re n d d d d o o l l l l a a r r s s . . . . 11 ' , , 2 66 2 6 3 , , 5 0 0 0 0 0 69,000 pleted, it will be found that all the brains and Five thousand dollars. energy of the Nation which have been released Ten thousand dollars.. 10,000 Fractional parts from occupations nonessential to the war will Total 347,681,0161,916,000 1,126,344,610 12,843,365 be required in enterprises and activities which Deduct: are essential to the war, and that the welfare Unknown, destroyed 1,000,000 Held in Treasury... 6,828,891 3,941 17,560,005 and prosperity of the country as a whole will Held by Federal Renot be impaired. 64,480,424 Redeemed but not " Business as usual'' can not, of course, be assorted by denominations adopted as the guiding principle in time of Net. 339,852,125 1,912,059 1,044,304,181 12,758,885 war. It is a wholly wrong theory and should find no advocacy or acceptance by the sensible Denominat i ons. N n a b o t a i t n o e k n s. al cert G if o ic ld ates, c S c e a i r l t t v e if e s i r . - Total., m an u d s t p b a e t r re io a t d ic ju s p te e d o p t l o e th o e f w A a m r-m er a ic k a i . n g B fu u n s c i t n i e o s n s One dollar $342,072 $230,317,999 8250,165,622 of the Nation. Two dollars 163,392 4,078 78,947,457 What is of superlative importance in the Five dollars 112,749,590 156; 339, 772 687,513,892 Ten dollars 297,431,410 $404,344,090 12,105,8411,,169,104,267 readjustment that must take place is that our F T O i w n ft e e y n h d t u y o n l d d la o re r l s l d a r d s ollars... 2 3 2 4 4 9 2 , , , 9 9 1 7 5 3 5 5 8 , , , 5 8 1 0 6 0 0 0 0 3"1 7 2 9 , 5 3 4 2 3 9 3 5 " 3 i , , 4 9 7 " - 0 5" 2" " 0 5 4' "' 1 8 6 , , 4 7 2 6 4 8 3 6 0 , , , 7 3 7 2 8 1 0 0 0 2 9 1 3 7 9 4 2 1 , , , 2 5 3 9 5 4 0 2 3 , , , 6 2 9 3 2 9 6 0 0 p o e f o e p c l o e no sh m a i l z l in b g e i i n m t p h r e e s c se o d n su w m it p h t io th n e o n f ec a e rt s i s c i l t e y s Five hundred dollars.. 88,000 109,030, 000 15,500 30,800,000 One thousand dollars.. 21,000 939,500 16,000 147,268,500 of clothing, food and fuel, and of every other T Fi e v n e t t h h o o u u s s a a n n d d d d o o l l l l a a r r s s . . . 6 9 3 7 0 0 , , 0 0 0 0 0 0 8 1 2 4 0 2 , , 9 6 8 3 0 0 , , 0 0 0 0 0 0 thing which constitutes a drain upon the avail- Fractional parts 56,936 56,936 able supplies, materials, and resources of the Total 717,921,860 2,034,266,669 484,680,000 4,725,653,520 country. Everything wasted now is nothing Deduct: TJnknown,de stroyed 1,000,000 short of criminal. So far as I have been able Held in Treasury 14,374,836 640,454,700 10,212,595 689,521,448 to observe, the American people are not suf- Held by Federal Re- Re s d e e rv em e a e g d e n b ts ut not 238,899,980 303,380,404 f a i n c d ie n o t f l y s a a v r i o n u g s e i d n t t o h is th r e e a n l e ly ce s s s e i r t i y o u o s f ti e m co e n , o n m o y t assorted by denominations 869,795 only in the life of America but of the nations 869,795 Net. 702,677,229 1,154,911,989 474,467,405 3,730,881,873 of the world. Up to the present there has been Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 19 a relatively small denial of pleasures, comforts, vantageous to the investor and to encourage and conveniences on the part of the average everyone to save his money and lend it to the citizen. He is drawing upon the general store Government. of supplies in the country with almost the same The plan offers the most direct incentive to freedom as before America came into the war. economize and save ever offered to the people This can not continue without serious hurt of the country. When the Government makes to the Nation and to the world. The great it possible for everyone to know that by saving financial operations of the Government can 25 cents, which otherwise would have been not be carried forward successfully unless the wasted, he can invest that 25 cents in a Governpeople of the United States economize in ment obligation, it is a definite objective to every possible direction, save their money which each one's economy may be directed. and lend it to the Government. By saving In other words, it is possible to transmute one's money they give up some of their needless economies into a specific obligation of the Govpleasures; they reduce their demand upon the ernment, and each one who saves is able to general supply of food, clothing, and other know that his economy is producing a concrete materials in the country, releasing thereby result advantageous to himself, of benefit to his that much more for the use of our own armies Government, and a direct contribution to the and the armies and civilian populations of winning of the war. the nations which are fighting the common I look upon the war-saving campaign which danger with us. They are at the same time the department has now inaugurated as promisincreasing their own material prosperity by ing the most wholesome benefits to the American their savings, and they are directly helping people, and producing fundamental conditions their Government by lending it the money that will be of immense help in financing, as with which it can buy the necessary supplies well as in successfully prosecuting, the war. and command the necessary services to make Interlocked with the question of " small savour fighting forces stronger and more effective ings" which can be invested in war-savings in the field; and this means an earlier victory stamps at interest is the question of " large for American arms. savings" which can be invested in Liberty The great difficulty is to impress this lesson bonds at interest. The men and women of of economy upon the American people. It large and moderate means owe a greater duty, will require widespread propaganda and con- because they have a larger margin of income, stant effort. With this in view, it was my to cut off self-indulgences, to deny themselves privilege to suggest to the Congress the raising useless and needless luxuries, to make sacrifices of $2,000,000,000 by the sale of war-savings of comforts, pleasures, and conveniences that stamps and thrift stamps, so that the American will effect genuine economies and set an exampeople would have the opportunity, as well as ple to the Nation. Every dollar saved reprethe direct encouragement, to economize and sents actual supplies saved and made available save money by putting within their reach the for heroic soldiers and suffering civilians in opportunity of lending their savings, in such Europe and America. small amounts even as 25 cents, to their own It is easy to visualize the course of a dollar Government. saved from waste and invested in Government We have therefore organized a war-savings bonds: First, it goes to the Government as a campaign upon a wide scale and shall bring to loan for the war; second, it is expended by the the attention of every man, woman, and child Government for food, clothing, and ammuniin the country the privilege now offered to tion which go directly to a gallant soldier or them of serving themselves and serving their sailor, whose fighting strength is kept up by country by depositing their savings with the the food, whose body* is kept warm by the Government of the United States upon the clothing, and whose enemy is hit by the ammusafest security in the world. The Government nition. It has not been expended in the purwill accept these savings and issue its direct chase of needless food and clothing for the man obligations for them in the form of war-savings at home, and is therefore released for the use stamps and thrift stamps. of the soldier; it is saved wealth to the man at These stamps are not issued by the Govern- home and can be loaned to his Government at ment as an investment for the rich. They are interest, with resulting benefit to himself and intended for people of small means primarily. to his Government. They are intended to bring within the reach of The man who subscribes for a Government everyone in the United States the opportunity bond, and is advertised as a patriot for doing of investing in the obligations of the United so, is not a patriot if he immediately sells that States Government upon terms unusually ad- bond on the market when he does not impera- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

20 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. lively need the money. It is not mere sub- Government bonds, the greater the cost to scription to a bond that helps the Government; the American people of carrying on the war it is the actual purchase oi the bond and the and the greater will be the depreciation in keeping of the bond that really helps. The peo- all other forms of investment securities. We fle must save and invest in Government bonds, can not regard without concern serious declines t is by actually lending money to the Gov- in the general value of fixed investments. It ernment and not by merely promising it and should be the earnest endeavor of everyone to shifting the load to some one else that the citi- prevent this, and I earnestly hope that the zen really helps in this great time. If loans processes of education and of unselfish conare made to the Government and bonds are sideration of the problem from the standpoint taken therefor, the lender is supposed to deny of the general interest will provide the neceshimself something which releases, in turn, a sary remedy. demand on the vital supplies or stores of the The Government must, if necessary, absorb country and puts the Government in position the supply of new capital available for investto buy the supplies thus released and to furnish ment in the United States during the period them to our armies and navies. But if the of the war. This, in turn, makes it essential lender immediately sells his bonds, relieves that unnecessary capital expenditures should himself of the obligation to save vital supplies, be avoided in public and private enterprises. and goes on wasting them, he does his country Some form of regulation of new capital exa grievous injury and hurts himself as well. penditures should be provided. The subject I want to make it clear that there is no desire is having deep study, and I hope to be able to on the part of the Government to prevent or to submit some suggestions during the session of interfere with freedom of legitimate trading in the Congress whicn will be of a constructive, as Government bonds—that is, trading in good well as of a regulatory, nature. It may also faith. become necessary to concert some constructive We must realize that the Government's measures through which essential credits may credit is vital to the success of the war; that it be provided for those industries and enterprises underlies every activity. It is a sacred duty in the country essential to the efficient and of every citizen, and it should be regarded as a successful conduct of the war. The subject glorious privilege by every patriot to uphold requires the best thought and study. It is the Government's credit with the same kind of receiving the most earnest consideration. self-sacrifice and nobility of soul that our gal- The courage and resources of the Nation are lant sons exhibit when they die for us on the so abundant that America's success in the war battle fields of Europe. It is as imperative to is beyond question if they are properly organsustain the Government's credit as it is to sus- ized and intelligently used. The economic tain our armies, because our armies can not be and financial condition of the country was never sustained unless the Government's credit is so strong and America's spirit was never more always above reproach. aroused to the importance and necessity of I have indulged the hope that additional going forward, resolutely and regardless of bonds could be sold on sucn reasonable terms sacrifices, to the accomplishment of the great that the remainder of the funds required to task to which God has called us. meet the estimated expenditures for the fiscal ^* ^1* *J* *5* *|* year 1918 might be raised by that means and LOANS TO FOREIGN GOVERNMENTS. thus escape additional revenue legislation at this session ol the Congress. It is my earnest con- By the acts of Congress of April 24, 1917, viction that the general economy of the coun- and September 24, 1917, authority was vested try should be permitted to readjust itself to the in the Secretary of the Treasury, on behalf of new revenue laws before consideration should the United States, with the approval of the be given to the imposition of additional tax President, to establish credits in favor of for- * burdens. If a situation should develop where eign Governments engaged in war with the the Government could not sell convertible and enemies of the United States, and, to the expartly tax-exempt bonds upon a 4 per cent tent of the credits so established, from time to basis, it would, I believe, become necessary to time, to purchase at par from such foreign seriously consider further revenue legislation. Governments, respectively, their several obli- In my judgment an increase in the rate of gations, such obligations under the authority interest on such bonds would be extremely of the act of April 24 to bear the same rate of unwise and hurtful. The higher the rate on interest and to contain in their essentials the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1, 1918. FEDERAL RESERVE BULLETIN. 21 same terms and conditions as those of the the war. After obtaining all light possible as United States issued under authority of the to the reasons for such necessities, if it was act, and under the terms of the act of Septem- determined that a loan should be made it was ber 24, to bear such rate or rates of interest, then submitted to the President, and, if he apnot less than the bonds of the United States, proved, a credit of the sum indicated was esto mature at such date or dates, not later than tablished and drawn against from time to time the bonds of the United States then last issued as the cash was needed to meet those requireunder authority of either act, and to contain ments. such terms and conditions as might from time The obligations which have been purchased to time be determined by the Secretary of the under the terms of the acts referred to are in Treasury. the form of short-term or demand certificates A total appropriation of $7,000,000,000 was of indebtedness signed by the duly authorized provided for these purposes, $3,000,000,000 by representatives of the respective Uovernments the earlier act and $4,000,000,000 by the later. receiving advances of funas. These obligations Under these authorizations credits have been under their terms shortly will be converted, at established in favor of the Governments of par, with an adjustment of accrued interest, Great Britain, France, Italy, Russia, Belgium, into an equal par amount of gold bonds of the and Serbia, and advances have been made to Governments concerned. Interest on these dethose Governments as indicated in the follow- mand obligations was first placed at 3 per cent ing tabulation, which includes all such credits per annum, and shortly thereafter increased to and advances up to November 1, 1917: Si per cent per annum, these rates being established to conform to the rates paid by the Government of the United States on its short-term Loans and Balances under certificates of indebtedness issued under au- Country. credits agreed Loans made. established upon. credits. thority of the act of April 24, 1917, in anticipation of receipts from the sale of the bonds of Great Britain $1,425,000,000 81,425,000,000 the first Liberty loan. Subsequently, and France 820,000,000 820,000,000 coincident with the sale of these bonds, the Italy 500,000,000 255,000,000 $245,000,000 Russia* 325,000,000 159,700,000 165,300,000 rate was raised to 3-£ per cent per annum, thus Belgium 58,400,000- 54,500,000 3,900,000 Serbia 3,000,000 3,900,000 conforming with the rate carried by the bonds. For obligations purchased since the approval Total 3,131,400,000 2,717,200,000 414,200,000 of the act of September 24,1917, the rate was i Of the credits and loans in favor of the Russian Government, $5,000,000 placed at 4J per cent per annum. represents a loan to the Roumanian Government, the advance being made in this manner through the Russian Government in the absence of By the terms of this act the normal rate of a Roumanian representative in the United States who could negotiate a interest to be borne by the obligations of the direct loan to his Government. United States issued thereunder could not ex- The established credits indicated in the above ceed 4 per cent per annum. At the same time table cover the period from the date of the it rendered the bonds thus issuable exempt passage of the earlier act, April 24, 1917, up from certain classifications of taxes, thereby to November 1, 1917, or a little more than six substantially increasing the cost to the Governmonths. On the basis of the requests being ment of the money received from the sale of made on the Treasury it was estimated that its obligations by diminishing the amount credits aggregating approximately $500,000,000 which it might in turn take from its citizens per month would be required to meet the urgent in taxes. The rate of interest to be charged war needs of the foreign Governments receiving on the loans to foreign Governments under the advances from the United States. With a bal- terms of the act was not definitely fixed, but ance of about $4,000,000,000 remaining avail- was left in the discretion of the Secretary, able for the period beginning November 1, though a minimum was fixed. In the exercise 1917, and with these credits averaging about of that discretion it was determined to fix the $500,000,000 monthly, it is anticipated that rate at 4£ per cent per annum, the additional the appropriation will be ample to meet the one-quarter per cent being added to compenrequirements to the close of the fiscal year. sate in part at least the loss to the Govern- In negotiating these loans the judgment of ment due to the tax-exemption features on its the Secretary has been determined very largely own obligations above referred to and the cost by what was represented to him as the actual incurred by the United States of issuing its necessities for the purchase of supplies and ma- own bonds. This rate in turn will be further terials and other requirements in carrying on increased in case there should be higher rates 31939—18 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

22 FEDERAL BESERVE BULLETH9". JANUAEY 1,1918. of interest paid by the United States during war, authority was given to deposit with incorthe continuance of the war for the moneys porated banks and trust companies subscribing that it may invest in the purchase of foreign to the various issues of bonds and certificates obligations. the proceeds arising from their subscription payments thereto. THE STOCK OF GOLD. While such deposits were necessarily of a temporary character, they nevertheless served The gold monetary stock (coin and bullion to prevent any unusual disturbance of the used as money) in the United States on Nomoney market or business conditions throughvember 1, 1917, is estimated at $3,041,500,000. out the country. The increase in the past 10 months has been In connection with the issues of certificates $174,500,000; in the past three years $1,236,of indebtedness prior to the first Liberty loan, 500,000; while in the past five years it has been 134 national and 100 State banks and trust $1,161,333,000. In five years the portion of companies in six Federal reserve districts made the world's gold monetary stock held by the application and were accordingly designated as United States has increased from approxidepositaries for these funds. mately one-fifth to more than one-third. Subsequently, 1,251 national and 780 State banks and trust companies in the 12 Federal CONVERSION OF 3J PER CENT BONDS OF THE reserve districts made application and were FIRST LIBERTY LOAN. designated as depositaries of public moneys to In consequence of the issue of the second enable them to make payment by credit for Liberty loan at 4 per cent the right to convert bonds of the first Liberty loan and to receive the 3J per cent bonds of the first Liberty loan cash deposits of funds realized from the sale of into 4 per cent bonds arose on November 15, said bonds. A total of $860,117,491.91 of the date borne by the bonds of the second Liberty loan funds was deposited with these Liberty loan. At the time of this writing it banks, every dollar of which has since been is not known whether the conversion privilege gradually withdrawn through the Federal rewill be exercised in large measure or not. As serve banks and credited in the Treasurer's conversion operations must be handled coin- general account. cident with the issue of the bonds of the second Prior to the second Liberty loan, the number Liberty loan, and just before the first interest of special depositaries was further increased by payment date for the bonds of the first Liberty 83 national and 72 State banks and trust comloan, the facilities of the Treasury Department panies which subscribed for certificates of and of the Federal reserve banks will be strained August 9. to the utmost to care for the situation, par- The above deposits were made under Departticularly if any great number of holders of the ment Circular No. 81. bonds of the first issue immediately present All designations made subsequent to August their bonds for conversion. To care lor the 9 and prior to October 6 covered deposits to be situation, in a measure, coupon interest pay- made on account of the sale of both certificates ments on bonds converted will be made through of indebtedness and Liberty loan bonds, and adjustment coupons attached to the 4 per cent were made under Department Circular No. 81. bonds issued upon conversion. These special Designations made after October 6 likewise covcoupons will care for interest at 3J per cent ered the issue of both certificates and bonds, from June 15 to November 15 and at 4 per and were made under the provisions of Departcent from November 15 to December 15, or ment Circular No. 92. at 3J per cent from June 15 to December 15. At the close of business on November 13, The conversion provisions are covered in 1917, the Secretary had designated 1,903 na- Treasury Department Circular No. 93. tional and 1,343 State banks and trust companies with authority to receive deposits on DEPOSITS OF PUBLIC FUNDS. account of their subscriptions to any one or all of the various issues of bonds and certificates Under the provisions of the acts approved of indebtedness without the necessity of mak- April 24 and September 24, 1917, authorizing ing application and being designated each time the issuance of certificates of indebtedness and they subscribe to certificates and bonds and bonds to meet expenditures incident to the desire to pay for them by credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDEEAL RESERVE BULLETIN. 23 Summarizing the foregoing by Federal re- tion to the exportation of coin, bullion, and serve districts: currency be administered by and under the authority of the Secretary of the Treasury, and Number of national banks and State banks and trust com- upon the recommendation of the Secretary of panies in each Federal reserve district designated as special the Treasury prescribed regulations providing I that application for permission to export coin, | bullion, or currency must be filed with a Number of Total imm-| Federal reserve bank, which would transmit Tifltinnni ! State banks berofde- District. bpniSr i and trust ! positaries the application to the Federal Reserve Board. oanics. companies.; created. The board, subject to the approval of the Secretary of the Treasury, was authorized to B N o e s w to Y n ork 2 1 8 7 0 3 ! : 2 9 1 2 0 ; ! 2 4 6 9 5 0 permit or refuse the exportation. Philadelphia.. 206 ! 115 ! 321 In pursuance of the Executive order the Cleveland 205 ! 120 325 Richmond 204 ' 180 j 384 Federal Reserve Board, with the approval of A Ch tl i a ca n g ta o 2 1 5 2 0 5 ; ! 2 8 26 7 I ! 2 47 1 6 2 the Secretary of the Treasury, issued regula- St. Louis 119 i 97 : 216 tions governing the administrative procedure Minneapolis... 172 ! 186 i 358 Kansas City.. 162 i 73 | 235 with regard to the exportation of coin, bullion, Dallas 137 : 41 ! 178 and currency. San Francisco 195 163 ! 358 At the time of issue of the above procla- Total... 2,228 1,590 3,818 mation the United States was practically the only large country freely parting with the pre- Interest at the rate of 2 per cent per annum cious metals, and as a result there was a tendis charged for these deposits, and at the close ency to transfer to New York by means of exof business October 31, 1917, the Federal change operations balances due by foreign reserve banks had reported that there had countries and to export gold from the United been collected through them $1,443,956.42. States in payment of such balances. In these The following table shows the amounts of circumstances it became necessary for the prointerest collected upon all public deposits tection of the gold reserve of the United States during each of the past five fiscal years: to place restrictions on the export of gold. In the exercise of these powers no obstacle Year ending June 30— 1913 |122,218. 89 has been placed in the way of the free exporta- 1914 1,409,426.07 tion of silver bullion or silver coin of foreign 1915 1,222, 706. 93 mintage, nor upon the export of United States 1916 791,671. 45 notes, national-bank notes, or Federal reserve 1917 1,061, 992. 07 notes, nor upon Canadian silver coin or currency; but the exportation of gold has not been EXPORTS OF COIN, BULLION, AND CURRENCY AND permitted except in those cases in which un- TRADING WITH THE ENEMY. usual circumstances have seemed to justify the The act of June 15, 1917, vested in the issue of licenses for its export. The depart- President the power to prohibit by proclama- ment has not, however, rested content with a tion the export from this country of any negative policy of prohibition, but has initiated article mentioned in such proclamation except a series of negotiations having for their purat such time and under such regulations as pose the substitution of arrangements which, the President might prescribe. Accordingly while avoiding the necessity for large exports the President on September 7, 1917, issued a of gold, would yet stabilize the exchanges beproclamation to the effect that— tween the United States and neutral counexcept at such time or times, and under such regulations tries. Progress in these negotiations has been and orders, and subject to such limitations and exceptions made in various directions, although none of as the President shall prescribe, until otherwise ordered the negotiations has yet been carried to a final by the President or by Congress, the following articles, conclusion. By stabilizing the exchanges benamely: Coin, bullion, and currency shall not, on and tween the United States and any neutral counafter the 10th. day of September, in the year one thousand nine hundred and seventeen, be exported from or shipped try it will be possible to maintain with such from or taken out of the United States or its Territorial country a course of trade much more nearly possessions * * *. normal than if exchange rates continued sub- By Executive order of the same date the ject to violent and erratic fluctuations. It is President directed that the regulations, orders, a pleasure to record that neutral countries limitations, and exceptions prescribed in rela- have entered on these negotiations in a cordial Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

24 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. spirit of cooperation, and it is hoped that Whereas it appears from estimates subarrangements may shortly be concluded with mitted and considered that it is necessary that various countries. a fund equal to one hundred and thirty-five Under the act approved October 6, 1917, thousandths of 1 per cent (0.00135) of the commonly known as the trading-with-the- capital stock of the Federal Reserve Banks be enemy act, wide powers were vested in the created for the purposes hereinbefore de- President, which, under Executive order of scribed, exclusive of the cost of engraving and October 12, 1917, the President allocated to printing of Federal Reserve notes: Jfow, therevarious departments of the Government. fore, Be it resolved. That pursuant to the authority vested in it by law, the Federal Reserve Board hereby levies an assessment upon the several Assessment by Federal Reserve Board. Federal Reserve Banks of an amount equal to one hundred and thirty-five thousandths of Acting under the provisions of the Federal 1 per cent (0.00135) of the total capital stock Reserve Act, the Federal Reserve Board on of such banks, and the fiscal agent of the Board December 12 voted an assessment of 0.00135 is hereby authorized to collect from said banks upon the capitalization of Federal Reserve such assessment and execute, in the name of Banks to cover the estimated general expenses this Board, a receipt for payment made. Such assessment will be collected in two installments of the Board from January 1 to June 30,1918. of one-half each; the first installment to be The assessment is based upon a capital of paid on January 1, 1918, and the second half $138,096,000, as of December 7, 1917. The on March 1, 1918. rate of assessment will yield $186,430. The Estimate for January, 1918, assessment. resolution of the Board, with the figures on which the assessment is based and a detailed Average monthly encumbrance for period July 1, 1917, to Dec. 31, 1917 $21,870.42 statement of expenditures and commitments as Estimated monthly requirements, January a basis of estimate, are given below. This to June, 1918, inclusive $30,811. 24 assessment is slightly larger than that made Estimated monthly increase $8,940. 82 for the previous six-month period. This is Estimated requirements, January to June, due to the enlargement of the activities of the 1918, inclusive $184,867.44 Federal Reserve Board and the increased work Estimated unencumbered balance Jan. 1, 1918 0.00 which it has been and will be called upon to Total capitalization of Federal Reserve Banks perform. Dec. 7, 1917 $138,096,000 Rate of assessment to produce $184,867 0.0013387 Whereas under section 10 of the act ap- Rate of assessment to produce $186,430 00135 proved December 23, 1913, and known as the Rate of assessment to produce $193,334 0014 Federal Reserve Act, the Federal Reserve Rate of assessment to produce $207,144 0015 Board is empowered to levy semiannually upon In view of all conditions I have the honor to recommend the Federal Reserve Banks in proportion to that an assessment of one hundred and thirty-five thousands of 1 per cent be levied. their capital stock and surplus an assessment SHERMAN ALLEN, sufficient to pa^r its estimated expenses, in- Fiscal Agent. cluding the salaries of its members, assistants, Approved for 0.00135. attorneys, experts, and employees tor the half F. A. DELANO, year succeeding the levying of such assessment, 0. S. HAMLIN, A. C. MILLER, together with any deficit carried forward from Committee on Organization, the preceding half year; and Expenditures, and Staff. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUABY 1,1918. FEDERAL RESEEVE BULLETIN. 25 Detailed statement of expenditures and commitments as a basis of estimate. Estimated J N u o 1 l 9 y v 1 . 7 1 . 3 t 0 o , E D st e i c m em at b e e f r o . r T m ot o a n l t f h o s r . 6 av m M er o a o n g n t e t h h f s l o . y r 6 q m u J o i a r n n e . t m h 1 l e y t n o r t e s - , June 30,1918. Personal services: Board and its clerks , $37,040.56 $7,458.33 $44,498.89 $7,416.48 $7,458.33 Secretary's office 11,885.00 2,430.82 14,315.82 2,385,97 2,430.82 Counsel's office 9,013.33 1,846.66 12,764.84 1,810.00 1 846.66 Division of audit and examination. 10,149.83 2,614.96 12,764.84 2,127.47 2,614.96 Division of reports and statistics.... 7,083.34 1,447.66 8,531.00 1,421.83 1,447.66 Division of issue 4,203.99 1,041.64 5,245.63 874.27 1,041.64 Messengers 2,485.83 493.33 2,979.16 496.53 493.33 Charwomen 327.05 66.00 393.05 65.51 66.00 Contingent 2,609.91 Total 82,188.98 17,399.40 99,588.38 16,59a 06 20,009.31 Nonpersonal services: Transportation and subsistence- Board and its clerks 774.37 100.00 874.37 145.73 200.00 Secretary's office , 18.00 18.00 3.00 20.00 Division of audit and examination. 3,802.03 "700." 66' 4,502.03 750,34 1,000.00 Division of reports and statistics.... 40.05 40.05 6.68 10.00 Counsel's office , 22.90 22.90 3.82 10.00 Messengers 10.00 5.00 .15 2.50 3.00 Communication service: Telephone 870.98 180.00 1,050.98 175.16 250.00 Telegraph 3,227.70 800.00 4,027.70 671.28 1,000.00 Postage 20.00 20.00 3.33 5.00 Printing, binding, etc 10,938.46 1,500.00 12,438.46 2,073.08 2,000.00 Contract repairs 35.09 35.09 5.85 20.00 Electricity (light and power) , 150.00 30.00 180.00 30.00 30.00 Steam (heat) 30.00 15.00 45.00 7.50 15.00 Other (nonpersonal) 873.23 50.00 923.23 153.87 50.00 Supplies: Stationery 646.69 150.00 132.*78 150.00 Periodicals 150.80 150.80 25.13 25.00 Other 260.09 50.00 310.09 51.68 100.00 Equipment: Furniture and office supplies 3,540.74 300.00 3,840.74 640.12 500.00 Books 142.40 142.40 23.73 25.00 Gold settlement fund 805.91 150.00 955.91 159.32 200.00 Rent 555.79 188.93 744.72 124.12 188.93 Contingencies 500.00 500.00 83.33 5,000.00 Total 26,895.23 4,738.93 31,634.16 5,212.36 10,801.93 Grand total. 109,084.21 22,138.33 131,222.54 21,870.42 30,811.24 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

26 FEDERAL RESERVE BULLETIN. JANUABY 1,1918. GOLD SETTLEMENT FUND. gains of gold in the fund largely at the expense of the Philadelphia, Richmond, and St. Louis Shifting of funds and credits through the banks. Balances in the fund, including gold settlement fund from the interior to New amounts standing to the credit of Federal York in connection with the second Liberty Reserve Agents, show an increase for the 4 Loan and other fiscal operations of the Govweeks of $61,735,490 and stand now at ernment account largely for the heavy volume $799,347,600, compared with $272,320,000 at of clearings effected through the fund during the beginning of the year. the 4 weeks ending December 20, 1917. For Below are given figures showing changes in the latter week, which witnessed payment of the fund between November 22 and December the second installment on the second Liberty 20, inclusive: Loan, combined clearings and transfers totaled $1,063,988,000, which is only slightly below Amounts of clearings and transfers. Federal Reserve Banks, the record total of $1,092,920,000 shown for from Nov. SO to Dec. 20, 1917, inclusive. the week ending November 22, following the payment of the first installment of that loan. [In thousands of dollars.] Combined clearings and transfers for the 4- Total Balances week period totaled $3,619,667,000, averaging clearings. adjusted. Transfers. $904,916,750 per week compared with a like Settlement of— average of $870,525,800 for the preceding 5 Nov.30,1917 694,329 51,329 62,500 Dee. 6,1917 711,686 59,729 135,000 weeks. Changes in the ownership of gold in Dee. 13,1917 823,664 34,885 128,500 Dec. 20,1917 947,889 74,731 116,099 the fund amounted to 2.27 per cent of the Total 3,177,568 220,674 442,099 obligations settled, as against 1.77 per cent for Previously reported for 1917 20,414,495 1,886,082 2,249,505.5 the 5 weeks ending November 22 and 1.74 Total since Jan. 1,1917 23,592,063 2,106,756 2,691,604.5 Total transfers Jan. 1,1917, to date. 2,691,604.5 per cent for the period from May 20, 1915, to Total for 1916, including transfers.. 5,633,966 Total for 1915, including transfers.. 1,052,649 December 20, 1917. Total clearings and transfers, As the result of the shifting of funds Chicago, May 20, 1915, to Dec. 20, 1917 32,970,282.5 New York, and Kansas City show considerable Changes in ownership of gold. [In thousands of dollars.] Total changes from May Total to Nov. 22,1917. From Nov. 22 to Dec. 20,1917, inclusive. 20, 1915, to Dec. 20, 1917. Balance to Federal lleserve Bank oi- credit Nov. 22,1917, Balance Decrease. Increase. plus net de- Dec. 20, Decrease. Increase. Decrease. Increase. posits of 1917. gold since that date Boston §18,444 89,915 S14,101 84,186 322,630 New York S600,116 121,101 6,002 27,103 3573,013 Philadelphia.. 74,048 36,956 12,837 824,119 Cleveland 102,669 63,737 60,930 2,807 Richmond 42,296 48,622.2 23,407.2 25,215 17,081 Atlanta 52,024 7,545 9,970 2,425 54,449 Chicago 50,499 41,232.2 79,280.2 38,048 88,547 St. Louis 35,039 32,370 10,842 21,528 13,511 Minneapolis... 19,007 15,177.5 10,328.5 4,849 14,158 Kansas City... 51,247.5 26,668.7 36,971.7 10,303 61,550.5 Dallas 50,847.5 21,162 17,590 3,572 47,275.5 San Francisco. 103,995 19,239 19,264 25* 104,020 Total- 600,116 600,116 301,523.6 301,523.6 82,090 82,090 573,013 573,013 i Debit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUABT 1,1918. FEDERAL RESERVE BULLETIN. 27 Gold settlement fund—Summary of transactions from Nov. 22 to Dec, 20, 1917, inclusive. [In thousands of dollars.] Balance Gold. Transfers. Weekly statemen 1 t 9 s 1 , 7 N . ov. 22 to Dec. 20, 1 D 91 e 7 c , . b 2 a 0 l , last state- ance in Federal Keserve Bank of— ment, fund after No 19 v 1 . 7 . 22, d W ra i w th n - . Deposited. Debit. Credit, de N b e i t ts. d T e o b t i a ts l . c T re o dd t ii a tt l s, cr N ed e i t ts, b c u l s o i s n e e o s f s. Boston $16 SI 59,900 851,000 $57,000 820,983 $266,139 §264,325 819,169 814,101 New York 28,507 105,000 55,392 95,000 265,000 142,897 1,094,969 952,072 6,002 Philadelphia., 33,511 69,570 73,015 45,000 1,000 9,590 317,400 337,281 29,471 12,837 Cleveland 58,485.6 2,126.6 7,378 48,000 265,322 310,515 45,193 60,930 Richmond.... 44,371.5 1.3 4,252 55,000 123,957 153,742 29,785 23,407.2 Atlanta 13,545 9,900 3,900 7,000 3,207 100,837 109,762 12,632 9,970 Chicago 74,938.7 60,531.5 26,825 30,099 38,000 392,739 422,886 30,147 79,280.2 St. Louis 26,140 7,700 13,930 20,000 9,638 197,620 196,092 8,110 10,842 Minneapolis.. 15,894 7,000 6,283.5 10,000 10,000 14,498 117,471 112,622 9,649 10,328.5 Kansas City.. 30,217.3 12,006 8,457.4 22,000 112,691 144,994 32,303 36,971.7 Dallas 19,204 3,042 5,000 14,000 10,000 3,787 85,332 85,760 4,215 17,590 San Francisco 31,069 20,640 8,810 45,000 61,099 16,074 103,591 87,517 19,264 Total... 375,899.1 297,518.4 223,142.9 442,099 442,099 220,674 3,177,568 3,177,568 220,674 301,523.6 Federal reserve agent's fund—Summary of transactions from Nov. 22 to Dec. 20,1917. [In thousands of dollars,] Balance ! Balance Federal Reserve Agent at— s N ta o t l e a v m s . t 2 e 2 n , t d w r G a i o w t l h d n - . dep G o o s l i d ted B D a e 1 c l 9 . a 1 7 n 2 . c 0 e , , Federal Reserve Agent at— s N ta o t l e a v m s . t e 22 n , t d w G ra i o w t l h d n - . dep G o o s l i d ted B D a 1 e l 9 c a 1 . 7 n . c 2 e 0 , , 1917. 1917. Boston $2,000 52,000 ' St. Louis 833,805 §13,900 §7,500 $27,405 New York 825,000 §100,000 75,000 Minneapolis 14,500 5,000 7,000 16,500 Philadelphia .. 54,624 68,215 69,020 55,429 Kansas City... 28,360 500 12,000 39,860 Cleveland 30,000 30,000 Dallas 10,874 5,200 2,800 8,474 Richmond. 31,500 1,500 30,000 I San Francisco.... 30,501 9,200 20,320 41,621 Atlanta 38,070 4,500 9,400 42,970 Chicago.. 87,479 19,444 60,530 128,565 Total... 361,713 152,459 288,570 497,824 OPERATION OF THE FEDERAL RESERVE CLEARING SYSTEM, NOV. 16 TO DEC. 15,1917. R b e I a t s e e n m r k v s a s e v i d n e c r r i a a t F y w g e e n d ( ) e d . o r a n a i l ly b s c i a i d t n I y e t k e F ( s m d e i a d n s i e l d d y r r a i s a l a t w v r R i e n c e r t a s o e g n o r e u v ) t e . - . I b d t a e is n m a t k r v s s i e c d r t i s r a n a g w ( e o d ) n t . a h i o e ly n r i u te r T m e ( o r d s t o a a d f l i l r U y ( a e n w x a i n v c te l e u o d r s n a i S g v T t e e a r ) t e . o e a f s s ) - Tre It a S e s t m u a a r v t s e e e r d s r r a o a g ( f w d e a ) U n . i l n y o i n ted m N be u e r m m o - - f N m b n e u o e r m m n - o - - f ber ber banks banks N b u e m r. - Amount. N b u e m r. - Amount. N be u r m . - Amount. N b u e m r. - Amount. N b u e m r. - Amount. i t n r ic di t s . - on li s p t. ar Boston 2,869 $15,856,369 36,658 $4,886,680 3,840 $6,643,603 43,367 827,386,652 3,012 82,226,271 242 New York 5,266 75,656,535 40,519 30,692,125 22,664 13,479,967 68,449 119,828,627 16,506 7,259,097 651 343 Philadelphia 15,489 17,713,945 19,916 3,136,378 10,140 11,991,578 45,545 32,841,901 2,316 1,826,072 628 310 Cleveland 1,599 3,500,772 20,049 10,675,135 1,609 2,990,266 23,257 17,166,173 785 288,232 763 565 Richmond 1,276 4,792,088 20,562 6,420,140 2,095 5,519,584 23,933 16,731,812 390 184,456 529 266 Atlanta 1,430 2,535,167 12,269 2,975,150 1,409 2,851,859 15,108 8,362,176 688 810,919 391 326 Chicago 7,128 19,607,000 18,020 4,196,000 1,738 728,000 26,886 24,531,000 3,029 1,475,000 1,084 2,331 St. Louis 2,557 9,219,408 12,504 3,170,070 204 2,057,179 15,325 14,452,657 4,490 1,408,199 479 997 Minneapolis 2,614 6,832,748 13,242 1,339,248 906 1,868,518 16,762 10,040,514 84,065 773 1,033 Kansas City 2,245 8,295,012 17,334 7,920,237 778 8,425,755 20,357 24,041,003 3,307,000 1,527 Dallas 1,403 2,237,551 13,812 6,361,821 566 1,389,507 15,781 9,988,879 315 166,674 211 San Francisco 3,802 5,476,844 15,811 2,661,777 404 513,136 20,017 8,651,757 1,382 8,023,068 534 1,170 Totals: Nov. 16 to Dec. 15 47,678 171,723,439 240,756 84,440,761 46,353 58,458,952 334,787 314,623,152 33,806 27,179,053 7,823 9,321 Oct. 16 to Nov. 15. 47,574 166,552,773 232,723 64,296,210 45,393 53,089,827 283,938,810 30,426 17,496,974 7,826 9,210 Sept.16toOct.15. 40,591 128,271,466 212,935 47,476,204 40,216 44,984,581 293,742 220,732,251 26,797 13,518,566 7,747 9,052 Aug. 16 to Sept. 15 36,306 100,331,694 182,191 41,323,621 32,564 40,648,168 251,061 182,303,483 23,492 11,006,515 7,718 8,934 July 16 to Aug. 15. 36,727 98,075,919 175,625 40,353,278 31,273 37,981,022 243,625 176,410,219 19,533 9,701,569 7,683 8,837 June 16 to July 15, 38,476 109,722,256 182,622 41,004,720 33,941 46,762,698 255,039 197,489,674 19,100 11,637,899 7,666 8,805 May 16 to June 15. 37,898 97,322,883 179,193 38,599,461 33,150 38,314,393 250,241 174,236,737 16,344 4,414,508 7,651 8,789 Apr. 16 to May 15. 33,767 87,370,859 171,093 36,473,163 33,428 36,836,934 160,680,956 15,925 3,597,865 7,634 8,926 Mar. 16 to Apr. 15. 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 8,607 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

28 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. CHANGES IN PRINCIPAL ASSETS AND LIABILITIES OF THE NEW YORK CLEARING HOUSE BANKS SINCE APRIL, 1917. Between the weeks ending April 7 and De- (for the week ending December 22) being cember 15 of the present year average weekly- 538.7 millions below the maximum of 966 loans and investments of the 59 banks, mem- millions shown for the first week in December. bers of the New York Clearing House Associa- Curve 1 in the first and third diagrams, intion, increased by about 1 billion dollars from dicating the movement of average loans and 3,639.2 millions to 4,638.5 millions, as shown investments, is seen to cross beyond curve 3 in the tables below and accompanying dia- (indicating the movement of average deposits grams. During the same period average net including deposits on Government account) demand and time deposits as shown in the body during the latter part of June following the of the weekly clearing-house statement show a consummation of the first war loan, falling, decrease from 3,913.5 to 3,768.8 millions. however, below the latter at the beginning of These deposits are, however, exclusive of July and moving on a lower level during the Government war-loan deposits, and in com- subsequent months. Since October 20, i. e., paring the movement of the items the increas- the time of the consummation of the second ing volume of these Government deposits Liberty Loan, the loan and investment curve should be considered. These deposits first has been running continuously above the averassumed importance during May, reached a age deposit curve, though for the more recent total in excess of 300 millions after the com- weeks the excess of loans and investments pletion of the first Liberty Loan, and fluctuated over total deposits has shown decreasing between 150 to 200 millions during the sum- amounts. mer until the latter part of September. Separate figures and diagrams are given for Further Government financing in connection clearing-house banks which are members of the with the second Liberty Loan apparently Federal Reserve system and for those which accounts for the more recent increases, the at the various dates were outside the system. high level of 966 millions for the week end- A glance at the second diagram indicates ing December 8 following the issue of the somewhat the intensity of the movement latest series of 691.6 millions of certi- into the system on the part of the larger trust ficates of indebtedness. Considerable net companies and State banks in Greater New withdrawals of Government deposits are noted York. This movement may be said to have for the subsequent two weeks, the latest figure fairly started only on October 6, when the Guaranty Trust Co. joined the system. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1, 1918. .FEDERAL RESERVE BULLETIN. 29 Average loans and investments, deposits, cash in vault, and excess reserves of the members of the New York Clearing House Association since week ending Apr. 7, 1917. Loans, discounts, investments, etc. Net demand deposits and time deposits. Special Government deposits. 1 2 3 " 5 ~8 Week ending— Non members Members of Non mem bars Members of of J 'R 10 e s K er e v rt e praJ Total. the R e F s e e d rv e e ral of i. i l . i ' o e s F e e n d e eral Total. the K e F s e c d rv e e ral Total. System. System, System, I System. Apr. 7., S2,298,297,000 S3,340.,907,000 "3,639,204,000 539,773,0C0 131,373.683,000 S3.913,456.000 14... 2.321.0X2,000 ls.;w 009.000 3,674,091.000 542,395.000 1,393.596,000 3,935,,991,000 21.. 2,30!;9-15,000 1,371.581,000 3.673,526,000 492,302', 000 1,413,840,000 3,900.142,000 28.. 2,287,948,000 1.39-),979,000 3,078,927,000 479,105; 000 1,439,417,000 3,918;,522,000 May II,. 2,251,600,000 1,373,292'. 000 3,f»2-l,9S2.000 401,217,000 1,405,501,000 3,806,718,GOO ?9,075,000 89,075,000 ' 12.. 2,243.428,000 1,338,,739,0f,0 3,5S2,167;000 375,021,000 1.374,486,000 3,749,507.00(5 39,622,000I 33,622,000 39... 2.2.S0,311,000 1,341.,0X7.000 3,621.398"TOO 396,645.000 I', 379.058,000 3,776.303', 000 63,785.000!S2o,882,000 89,667,000 26.. 2,313.391.000 1,35<5,62*', 000 3.670,019,0(10 435.911,000 1.397;635.000 i 3,833,546,000 49,598,000 16,923,000 66,521,000 June 2.. 2.354.553,000 1,364,093,000 3l718,616,000 434,062,000 i;374,936,000 i 3.809,598,000 91,792,000! 23,679,000 115,471,000 2,402,401,000 1,344.958.000 3,747,359,000 ! 2)448,618.000 1,345,367,000 3,793,985,000 73,909,000! 20,162,000 04,071,000 i(C 2,451,509,000 1,349.703,000 3.801,272',000 i 2,411,191,000 1,331,743,000 3,745,934.000 109.401,000! 31,787,000 141,188,000 23.. 2.4SR,510,000 1,325.095,000 3,813,611,000 j 2,3lK,306,000 3,288,508,000 3,606,814',000 99;383.0001 33.149.000 131,532,000 30.. 2,471.511,000 1,353,,558,000 3.825,069,000 ! 2,302.855,000 1,305,0(53,000 3. (507,918,000 151,284.000 60.160,000 211,444,000 July 7.. 2,482;878,000 1,370.137.000 3.853,015,000 381,602.000 1,294,725,000 3,670 327,000 207,320', 000 95', 476,000 302,796,000 14.. 2,502,142,000 1,366;252,GOO 3,868,394,000 499,562,000 1,320,183,000 3,819,745,000 127,719.000 621412,000 190,131,000 21.. 2.437,579,000 1.369,685,000 3,807,264.000 375,060,000 1,333.204,000 3.708,204,000 100,028', 000 SO', 308; 000 150,396,000 28.. 2,4.17,083,000 1',35-i,597,000 3,771,680!000 430,651,000 1,331,343,000 3.767,994,000 100,863,000 48,279.000 149,142,000 Vug. 4.. 2.388,951,000 1,363..794,000 3,752,745,000 400', 303,000 1,333,0-12,000 3,793,405,000 100.960,000 48,853,000 149,616,000 11.. I 2,441,607,000 ,322,000 3,795,9S9l000 i 2,480,450,000 1.324,202.000 3,801 652,000 103.258,000 41.448,000 '144,706,000 18.. I 2,507,685,000 T.343,252,000 3,850.917,000 I 2,425,802,000 ll299.201,000 3,725,003,000 155,996,000 49,226,000 205,222,000 25 1 .. .! i 2 2 , , 4 5 7 11 8 , ,4 4 2 8 7 5 , . 0 0 0 0 0 0 1 1, , 3 3 3 3 7 /, . * 9 J 2 2 2 3 . ) 0 0 0 0 0 0 3 3 S , 8 81 4 6 9 ; .40 3 S 49 . , 0 0 0 0 0 0 i ; 2 ", , 4 4 2 6 3' 0 , , 1 6 I 8 0 4 ! . 0 0 0 0 0 0 3 L . 3 3 0 0 5 (5 ; , 6 4 0 0 7 8 , , 0 0 0 0 0 0 3 % , 7 7 2 (K 9 i , l ,2 5 9 1 1 8 , ,0 0 0 0 0 0 1 1! 3 i 1. . 4 7 1 6 2 3 , , 0 0 0 0 0 0 3 3 3 8 . , 7 6 8 4 4 2 . , 0 0 0 0 0 0 1 1 5 7 1 0 . , 5 0 4 8 7 4 , , 0 0 0 0 0 0 ! 2,529.532;000 1,321,121), 000 3.850) 052,000 I 2,422,972,000 5,290,021,000 3,712.993,000 130;041,000 3i; 477', 000 1 fill 518,000 15.. ! 2.4«fi,991,000 1,321,,2Sa, 000 3,808.270.000 ! 2.412,552.000 1,305,582.000 3.718;134,000 ; 125,052,000 28,503,000 153,555,000 22.. j 2,545.370,000 1.329,,5P9,000 3i 874,965;000 i 2,415,524,000 1,278.224,000 3. 093,718,000 i 209.901,000 52", 196,000 262.097,000 29.. ' 2,577.468,000 1,318,412,000 l\ 895,880.000 j 2,454,225,000 1', 277.731,000 3', 731,956,000 ' 185,251.000 39,234,000 224,485,000 Oi:t. 6.. i 2,(535,421,000 1.326,000.000 3,961,424.000 I 2,471,760.000 1', 288.460. COO 3,7(53,,220,000 193,903,000 41,855,000 235,819,000 13.. i 3.077,813,000 ' 911,802', 000 I3,989,615',000 | 2,914,308,000 '889.51.5. GOO 3,803,,853,000 185,(571,000 14,791,000 200,465,000 20.. ! 3,150,210,000 921, 184,000 4,071,430.000 i 2,970.1195,000 897;304; 000 3,873,,599,000 174,030,000 17,959,000 191,989,000 27 3 . . . . i ! 3 4 v , 5 0 0 4 1 0 , .3 1 7 4 2 3 , , 0 0 0 0 0 0 672. 8 0 8 1 3 3 . , 0 0 0 0 0 0 4 4 , , 1 5 7 1 4 0 , , 0 3 2 8 (5 5 ) , 0 0 0 0 0 0 i ! 3 3 , , 3 3 5 5 0 L ) , 9 7 X 2 9 0 , , 0 0 00 00 4 64 4 8 3 , , 0 1 9 1 0 1 ', , 0 0 0 0 0 0 3 3, , 7 7 9 9 1 9 , .,0 8 7 3 9 1 . , 0 0 0 0 0 0 3 5 0 3 1 9 , , 6 2 3 6 1 0 , , 0 0 0 0 0 0 1 1 4 9 ' , , 2 8 2 8 2 8 , , 0 0 0 0 0 0 3 5 1 5 6 8 . , 5 4 2 8 2 2 , , 0 0 0 0 0 0 30.. ; 4,117,312.000 744.000 1.556,056,00!) ! 3,399.000,000 414,934.'. 000 3,813,,934,000 5l»3,Otf4,G0O 19,499,000 583.163.000 17.. i 4,321,698;000 300..013.0C0 4,622.3J1.000 I 3,549,524.000 271.885; 000 3,824.,409.000 (331,390,000 16,276.000 647,666,000 24.. ! 4)4S0,910,000 200! 05 5.000 4,691,58-1,000 i 3,461,335,000 275,506,000 3.(53(5,,901; 000 859,883,000 11,219,000 871,102,000 Dec. 1.. ! 4.444;031,000 192!, 483'. 000 4,030,514,ooo | 3;508,705,000 166,800,000 3,675,,505.000 .751,706,000 10,443,000 762,149,000 8.. ! 4,(579,753,000 189'. 6!0;000 4,869:353,000 1 3;570,914,000 165,017,000 3,735,,931; 000 957,765,000 8,245,000 966,010,000 15.. i 4,456,785,000 181',,759,000 4,638', 544,000 ! 3,608,433,000 160,3:2,000 3.768.,775,000 746,715,000 4,622,000 751,367,000 22.. ! 3>2477,000 180,,809,000 4.173,340,000 I 3,539,325,000 160,959,000 3,700),, 284,000 424,120,000 3,221,000 427,347,000 Cash in vault. Reserve in depositaries. Excess reserves. 10 12 13 Weekending— Members of Non members I tho Federal of the I Cue from the Reserve Federal Total. I Federal lie- System, Reserve ! servo Banks. SyFtcin. Apr. 7. 5339,961,0GO 8498.884,000 §233,558,000 558,990,000 8292,548,000 5324,000,610 §24,532,130 §148,532,740 14. 326,965,000 *3 S! 371)1000 496)34-1,000 227,962,000 (51,342,000 j289,304,000 105,278,420 33;977,280 139,255.700 21 303', 175, ()00 168.3-12,000 471,517.000 220,913,000 61,931.000 '282,844,000 83,899,070 30,882,950 114,7821020 28. 278,972,000 171)182,000 450.154; 000 218.928,000 63,007)000 311,935,000 90,181,5(50 31,742,790 123,924;850 M:iy 5. 2071 iOO, 000 155.297,000 4221(597,000 2171128,000 61,320,000 278,418,000 60,884.130 18,718,130 79,602,260 12. 270; 253,00') 362) 540,000 43:?; 793,000 244) 07H, 000 60,352,000 304,428.000 95,319) (580 28,6(54,110 123,983,790 19. 286,145,000 179.5261000 4(55,67 i, 000 237,512,000 (50,2(54,000 ]207,776l000 100,837,300 45,790,950 346,623,340 28.. 261)861,000 182.771)000 447,(^2.000 252,86-1,000 61, Cl 7,000 I 3n,4si;or.o 87,825.810 46.050,170 133,S75.980 S f O D a e e c c t l p . , y t. 2 2 2 1 2 2 3 2 1 1 2 2 I 1 1 1 2 1 1 7 S 0 0 7 2 9 3 8 4 5 1 2 5 4 6 1 9 0 1 2 3 1 7 4 6 . . . . . . . . . . , . . . , . . . . . . . 1 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 ( 1 9 9 9 9 9 9 8 8 8 8 9 4 8 7 8 8 1 0 0 1 1 0 7 0 1 1 1 2 K 3 > 2 7 7 2 9 5 1 0 7 4 0 3 7 5 6 5 3 1 2 2 0 8 6 1 0 0 0 7 ; ; , , . , , , . , , , , , , , , , ; , , . , , , , , , , , 0 4 6 7 6 2 1 3 0 9 2 8 1 9 9 7 2 7 5 5 8 6 5 9 0 2 4 0 8 8 3 5 4 1 1 1 1 1 3 6 3 3 9 1 8 5 9 9 4 8 7 7 9 3 3 0 8 2 1 1 ( 2 5 6 2 5 9 4 5 4 8 2 8 0 0 5 8 2 3 4 4 8 6 9 3 7 0 1 7 4 5 ; , , , , , , , , . , , , , i , , , , , , , , . , , , , , . 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 K 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 10 5 3 6 6 5 3 9 8 2 2 2 1 2 1 2 2 4 1 4 3 4 3 5 3 0 3 3 0 5 0 ! 6 7 4 2 5 2 2 8 9 0 0 9 ( 5 , 1 9 . 9 5 , 2 6 0 5 9 5 1 4 3 8 5 , 1 , ) , , , , , , , , , , , . , , , , , , , , , ( 1 8 6 , 4 2 9 0 0 5 1 0 2 , 9 4 8 7 7 0 7 8 7 3 4 1 5 ( 5 9 4 2 3 5 5 1 0 1 8 4 2 9 4 9 1 9 8 8 9 8 6 1 1 3 6 6 1 4 3 1 5 1 ( 5 ( ( ( 2 4 5 9 0 7 1 5 7 ( 9 0 5 3 8 2 4 2 2 9 8 7 2 7 3 5 1 5 1 5 3 0 , ; , , , , , , , , , , , , , , , , , , , , , , , , , , , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 . 0 0 0 0 0 0 0 0 ( 0 0 .5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I i 4 3 3 3 2 2 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 3 1 2 4 0 1 3 0 6 3 5 7 2 5 1 0 3 8 2 4 3 8 3 6 3 2 7 0 8 1 3 7 2 ( 6 9 3 2 0 0 9 0 0 8 ; 9 1 4 0 2 4 8 5 4 3 0 9 6 3 0 9 0 1 5 . , , ) , , , , , , , ) . , , , , , , , , , , , , , , , 4 ( , 8 1 2 8 0 0 5 4 3 8 5 7 2 7 4 1 7 7 6 8 0 9 0 1 8 4 2 2 5 ( 9 3 3 4 0 8 7 7 3 0 5 7 7 7 8 7 0 8 7 4 5 8 7 5 2 1 6 2 5 8 1 1 7 6 8 0 1 3 7 2 4 4 9 9 7 1 2 1 1 5 2 6 1 5 9 6 1 1 0 9 , , , , , , , , , , , ) , , , , , , , , , , , , , , , , . , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 3 2 2 3 4 4 4 3 3 3 3 3 2 4 3 3 4 5 4 3 4 4 4 5 5 5 5 5 5 ( 3 6 5 2 5 1 4 3 1 1 0 7 4 8 0 2 5 7 0 5 5 1 8 7 1 7 6 2 ~ 5 ? 3 2 5 . 1 9 3 7 5 9 0 2 0 9 3 6 5 4 1 1 7 1 9 0 6 9 5 8 2 f , , , , , , , , , , , , , , , , , , , . , , , , , , , , , t 5 7 2 1 9 0 7 8 8 2 9 8 4 1 3 ( 7 0 7 2 9 4 1 9 4 0 8 0 , ? 9 3 5 0 0 9 3 4 4 6 2 9 7 1 4 9 4 1 7 9 9 0 1 0 4 6 5 9 f 9 3 8 2 2 2 0 4 8 1 7 9 5 9 4 4 7 7 2 2 3 6 3 0 5 9 7 9 9 > 7 8 ; , . , , , , , , , , , , 8 , , , , , . , , , , , , , , , , 0 0 0 0 0 0 0 0 0 0 0 0 7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I I I ' i j 1 6 5 5 ( 6 5 5 6 6 5 7 6 6 8 9 8 7 9 7 5 3 7 3 1 1 1 5 ( ( ( 5 ( 0 8 7 5 8 0 2 8 0 7 6 8 1 1 2 1 9 8 6 1 9 2 6 0 , 5 5 5 3 5 , , , , , , , , , , , , , , , , , , , , , , , , , , , , , 1 2 3 8 9 7 2 2 9 0 3 8 7 4 9 5 8 2 3 7 7 0 3 8 1 ( 0 9 4 3 ( 5 5 7 2 3 3 8 4 7 3 3 S 0 2 0 3 7 7 7 0 5 2 8 3 2 4 9 1 5 5 1 8 5 ( 0 1 2 ( 0 6 3 7 5 8 3 7 7 0 2 5 7 9 7 3 3 8 1 4 4 5 5 4 5 , , , , , , , , , , , . ) , , , , , , , , , , , , , , , , , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I ! ! . ! i ' ! i ! ! ! " 3 2 3 4 2 3 4 4 5 4 4 4 5 4 4 4 4 5 5 4 4 5 5 5 5 4 5 5 5 5 7 0 8 2 3 ( 9 7 9 1 2 7 ( 9 2 2 3 4 ( 2 3 0 7 0 3 8 9 3 3 7 ' 1 i 5 6 5 9 2 2 7 5 1 8 3 4 1 4 5 9 2 9 4 4 0 7 3 3 2 0 1 7 , 5 0 3 1 , , , , , , , , , , , , , , , , , , , , , , , , . , , , , 3 4 8 0 5 9 8 7 2 7 5 9 9 8 3 8 0 2 2 9 3 7 9 0 5 1 8 8 1 9 4 5 0 7 ^ 8 3 1 5 7 1 2 4 5 5 6 4 1 3 1 9 9 8 9 6 1 0 3 5 7 7 3 5 7 3 5 0 4 7 3 3 2 3 7 ( 2 2 5 4 9 0 0 5 5 4 2 5 2 4 3 5 , , , , , , , , , , , , , , , , , , , , , , , , . , , , , , 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 1 1 1 1 1 1 8 3 4 3 5 9 5 1 6 1 5 5 4 5 0 6 8 5 4 7 6 8 5 9 7 7 8 1 2 2 3 5 ( 1 3 1 6 2 2 2 7 8 3 4 3 2 7 8 2 0 1 6 8 0 8 9 7 1 5 3 ; , , , 5 , . , , , . , , , , . ) , , , , , , , , , , , , , 7 3 , 2 9 9 9 ( 3 ( 0 5 8 1 9 8 5 4 4 6 2 1 9 4 8 4 0 2 0 1 5 0 0 ( 0 5 5 5 3 8 6 2 2 7 3 9 1 5 8 5 4 8 0 2 3 6 9 4 8 5 ( 4 0 5 7 9 9 0 2 5 1 2 4 9 4 9 1 9 0 9 7 5 6 9 0 8 4 9 4 3 5 , 6 4 , 5 4 , , . , , , , ; , , , , , , , , , , , . , , , , 8 , , , , 3 9 3 1 4 8 1 4 7 9 2 4 8 8 8 3 7 7 8 , 4 9 7 8 1 0 3 5 ( 4 0 1 4 3 1 0 8 7 1 4 0 4 4 5 3 3 3 8 0 0 0 8 0 5 5 6 8 1 5 3 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 1 2 2 1 1 3 1 1 1 1 1 1 1 1 1 8 2 8 3 2 2 9 4 8 5 4 3 7 0 7 8 5 8 3 9 6 1 3 0 6 2 1 1 1 1 , . , , ) , , , , , , , , , , , , , , , , , , , , , , , , , 5 7 3 2 8 9 4 7 7 0 8 0 2 2 5 7 4 3 ( 9 2 2 2 7 9 1 3 5 0 6 ( 8 . 7 6 5 3 9 2 9 1 5 9 3 5 5 1 1 0 7 1 4 8 2 8 0 2 2 9 8 5 ( ^ 2 6 5 1 8 7 7 1 5 0 2 7 6 9 7 7 5 5 8 9 9 1 9 7 7 3 2 S 4 5 , 1 , , , , , , , , , , , , , , , , , , , , , , , , , , , , ( , 9 2 2 6 7 4 8 3 0 1 5 6 1 1 7 2 7 3 8 8 5 9 0 1 9 5 0 7 3 2 1 2 5 1 5 5 6 1 3 4 9 0 8 4 7 1 5 6 3 5 0 5 5 5 8 1 4 8 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 " k I ' 2 1 1 1 1 1 1 1 1 1 G 5 3 7 6 6 4 6 3 2 7 5 7 8 6 0 5 8 9 9 6 6 8 2 2 8 1 9 8 O 3 ( 2 0 1 5 5 1 8 2 2 6 6 0 6 5 5 6 8 ' 2 4 7 4 ( 2 3 3 . 8 4 ) 5 , , , , , , , , , , , , , , , . ) , 5 , , . , . , , , , 0 S 1 0 ( 3 1 1 , 0 0 5 2 8 0 1 7 3 0 0 9 9 1 4 4 9 0 8 5 7 3 3 5 1 0 9 1 5 9 3 8 9 3 5 9 4 5 6 2 0 4 1 4 1 0 7 3 0 7 0 ( 8 0 8 2 7 0 3 2 1 8 0 7 2 6 1 5 4 5 1 9 2 1 5 6 6 5 2 8 7 5 1 0 . , , , , , , , . , , , ) , , , , , , , , ) , , , , , , , . 8 0 3 8 5 0 6 3 5 0 5 0 3 4 0 0 0 1 8 2 0 9 3 7 1 2 6 2 9 ( 8 1 8 8 7 8 6 4 5 8 1 3 3 4 2 3 1 9 5 0 9 5 4 3 6 4 8 2 9 5 2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 81939—18- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

80 Xi'EDEKAL BESEBV.K BULLETIN. AHS 1,191.8. INFORMAL RULINGS OF THE BOARD. Below are reproduced letters sent out from commodity paper for rediscount so that staple time to time over the signatures of the officers perishable food products, such as butter, cheese, eggs, poultry, frozen fish, etc., carried for seaor members of the Federal Reserve Board sonal periods in cold storage under negotiable which contain information believed to be of warehouse receipts, may be made eligible. general interest to Federal Reserve Banks and I beg to say that papers of this kind would be member banks of the system: I eligible if offered with the indorsement of a j member bank at the usual rate for 90-day com- Trade Acceptances, | mercial paper. The so-called commodity rate I have received your letter of December 13, 1 was established some time agp in order to give inclosing a copy of a letter from a member of a preferential rate particularly to farmers durthe Trade Acceptance Council. ing the crop moving-season In view of the The Federal Reserve Board has ruled on fact, however, that the present time and presseveral occasions that a bill of exchange ent circumstances do not warrant any particudrawn by the seller of goods and accepted by lar preference of this sort, the commodity rate the purchaser of those goods is a trade accept- has been abolished for the time being and has ance, regardless of whether or not the purchaser been merged with the general commercial rate. intends to resell the goods or to use them for I ought to add also that this commodity rate his own purpose, and that, therefore, a retail was granted only in such, cases where the bordealer may finance the sale of his goods to a rower gave an undertaking that he had adretail customer by means of the trade accept- vanced the money to the farmer at a rate not ance. exceeding 8 per cent. The Board believes, therefore, that a bill DECEMBER 15, 1917. drawn by a retail dealer on his retail customer to finance the sale of goods to that customer is a trade acceptance within the meaning of the Loans on City Real Estate. Board's regulations, even though it is drawn after the purchaser has failed to remit promptly The Federal Reserve Board has considered on an open account. the questions presented in your letter with reference to the right of national banks not The Board is also of the opinion, however, located in central reserve cities to make loans that to attempt to use the trade acceptance on city real estate. in this manner as a means of liquidating an The Board has heretofore ruled that the otherwise slow account would involve considprovisions of section 24 of the Federal Reserve erable danger to the primary purposes of the Act authorize a national bank to purchase or trade-acceptance movement, and would subdiscount a mortgage on city real estate, proordinate the trade acceptance to the open vided its maturity is not more than one year. account by suggesting it as a last resort for The Board has also ruled that a national bank bad debts. While, therefore, trade acceptmay discount a note payable within a year ances of this character should probably be secured by a mortgage or mortgages with a considered eligible as a matter of law, neverthematurity greater than a year. (See ruling of less member banks and Federal Reserve Banks the Board" printed on page 602 of the Novemshould be encouraged, to discriminate against ber, 1916, Federal Reserve Bulletin,) them as far as possible for the reason just With reference to the last question which stated. you present, namely, whether a national bank DECEMBER 24, 1917. may invest in mortgage certificates issued by a trust company as the direct obligation of that company and secured by mortgages, I wish to say that if the security for the trust com- Perishable Food Products. pany certificate is another note which in turn I have your letter of December 12, and the is secured by real estate, then, under the deinquiry made therein whether it is possible cisions of the Supreme Court, the loan is to amend our regulations on the eligibility of authorized by law, on the ground that it is a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1918. .FEDERAL EESEKVE BULLETIN. 31 loan on personal security, and not a loan upon the member bank accepting a bill and by the the security of real estate, so that the question Federal Reserve Bank to which it is offered, for of whether or not a national bank may invest discount. in such mortgage certificates does not involve | If the borrower exercises such control over a construction of section 24 of the Federal| the corporation issuing the warehouse receipt Reserve Act, which authorizes loans upon real ! as to give him control over the goods in storage. estate. Of course, transactions should be| the purpose of requiring a receipt of the indemade in good faith and not merely for the pur- pendent warehouseman would be defeated. {)ose of technically evading prohibition of the| The corporation issuing such receipt must be aw. If, however, the mortgage certificate is | organized in good faith, as an independent corsecured directly by a mortgage or deed of poration, and its affairs must be administered trust on realty, than the provisions of section by duly authorized officers and agents inde- 24 would have to be complied with. | pendent of the borrower in order to comply ! with, the rulings of the Board referred to. DECEMBER 18, 1917, ! NOVEMBER 30, 1917. Warehouse Receipts. j Revenue Stamps on Time Drafts. (To a Federal Reserve Uanlc.) (To a Federal Reserve Batik.) Receipt is acknowledged of your letter of the 23d instant, inclosing copy of a letter from the Receipt is acknowledged of your letter of the 1st instant, and in reply I would say that the president of the National Bank of Commissioner of Internal Revenue has ruled . In his letter to you the president of that a draft payable on arrival, or a draft paythis bank says: able on demand after arrival of goods is, in. "With a view to obtaining bank acceptances, effect, a time draft and must therefore have some of our mills are taking out registration for revenue stamps affixed. Your attention is their storehouses in their own name, and some called to the fact that a draft drawn payable on others are organizing their clerks and bookarrival of goods is open to serious doubt as to keepers as separate corporations to register. its negotiability, It seems preferable, there- This last is a mere subterfuge, and yet the fore, that banks should have their customers claim is made that warehouse receipts of the drew such drafts simply as demand drafts latter are more favorably considered than the which are not subject to a stamp tax. There first." does not seem to be anything to prevent a bank You ask to be o,dvised as to the attitude of from giving in its letter of transmittal such inthe Board in this matter. While the Board structions as it may see fit as to the presentadesires to encourage in every way the creation | tion or holding of the draft, of a proper discount market for acceptances and the use of this form of negotiable instru- DECEMBER 4, 1917. ment, it desires the banks to carefully observe the spirit as well as the letter of the law in developing this market. The Board has hereto- I Election of Branch Bsiik Directors. fore ruled that warehouse receipts offered as I (To a Federal Reserve Agent.) security for bills accepted by member banks under authority of section 13 of the Federal! The Board has ruled that directors of the Reserve Act must be issued by warehouses I branches of Federal Reserve Banks should be which are independent of the borrower. It i elected annually, and you are requested, thererecognizes the separate entity of a corporation I fore, to bring this to the attention of your diissuing the receipt when, such corporation is rectors at the next meeting in. order that they not itself the borrower. Where a corporation i may reelect those branch l>ank directors which is formed, however, as a subterfuge for the pur- i are chosen by your bank or make such changes pose of evading the spirit of the Board's ruling, as may be deemed proper. this fact should be taken into consideration txv DECEMBER 18, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

82 FEDEBAL RESERVE BULLETIN. JANUARY 1, 1918. LAW DEPARTMENT. The following opinions of counsel have been Under section 3477, Revised Statutes, these authorized for publication by the Board since vouchers, which represent claims against the the last edition of the Bulletin: Government, are not assignable. After the delivery of the goods to the Government, there- Drafts drawn to finance sales to the "United States Govfore, the holder of the obligation of the seller ernment. would have recourse only against the seller on Drafts drawn in connection with sales to the United the note or bill executed by him. This being States Government of lumber or other material can not be true, such paper would not comply with the treated as bills of exchange drawn against actually existing value and are subject to the limitations of section 5200, requirements of commodity paper and would Revised Statutes, when discounted by national banks. not be entitled to the rate of discount pre- Such drafts do not conform to the requirements of com- scribed for such paper. modity paper as defined by the Federal Reserve Board and Inasmuch as the claim of the Government is should not be discounted at the rate prescribed for such not assignable and a note or bill executed by paper. NOVEMBER 30, 1917. the seller will, therefore, embody the obligation SIB: The accompanying letter transmits for of the seller only, such notes or bills could not your consideration an inquiry received from be treated as commercial or business paper one of the member banks of the Fifth District actually owned by the person negotiating the to the following effect: same or as bills of exchange drawn against "A certain company is selling the Govern- actually existing value. They would, therement a large amount of supplies. Could we fore, be subject to the limit of 10 per cent preloan them on these sales under the head of scribed by section 5200, Revised Statutes. commodity paper, and would this be subject to The letter suggests that the matter be taken the 10 per cent limit?" up with the Treasury Department for the pur- The opinion of this office has been asked on pose of determining whether in such cases a the questions raised. warrant or other obligation may not be issued Commodity paper is defined in Regulation A, by the Government which would aid those who series of 1917, as "A note, draft, bill of ex- are furnishing supplies to finance themselves change, or trade acceptance accompanied and through their own banking institutions. secured by shipping documents or by a ware- In reply to this suggestion attention is called house, terminal, or other similar receipt cover- to circular letters of the Board sent to Federal ing approved and readily marketable, nonper- Reserve Banks and to Federal Reserve Agents, ishable staples properly insured.'' respectively, under dates of March 21 and While the attached letter is not specific on March 31, 1917. These letters, which appear the subject, it is unlikely that the sales of the on page 288 of the April, 1917, Bulletin, will Government are made or can be made in a make clear the difficulty in carrying out the manner which will enable the seller to offer suggestion made. paper representing the purchase price of such Unless section 3477, Revised Statutes, is sales in a form which will comply with the repealed or amended the War Department can requirements of commodity paper. not issue a negotiable voucher for claims As understood by this office, the custom in against it. such case is for the Government to require Respectfully, delivery of the goods and to subsequently issue M. C. ELLIOTT, Counsel. a voucher in favor of the seller for the amount To Hon. W. P. G. HARDING, due. Governor Federal Reserve Board, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1. 1918. FEDERAL RESERVE BTTLLETIK. Sales corporations. funds should not be treated as a trade accept- A draft drawn by a lumber corporation upon a sales cor- ance within the meaning of the Board's reguporation which it and a number of other lumber concerns lation which defines such acceptance as "a have organized will, when accepted, become a trade bill of exchange drawn by the seller or the puracceptance, even though the selling corporation is a stockchaser of goods sold and accepted by such holder of the sales corporation, provided the latter is organized in good faith and not merely to act as an agent purchaser/5 for the purpose of evading the law. Respectfully, M. C. ELLIOTT, DECEMBER 12, 1917. Counsel. SIR: The accompanying letter presents the To W. P. G. HARDING, following situation for the consideration of the Governor Federal 'Reserve Board. Board: I A sales corporation has been organized in Farm loan bonds. New York by eight large southern lumber con- Farm loan bonds are issued by Federal farm land bank; cerns. These concerns, which are stockholders incorporated under Federal lav/, and are not obligations of the United States, so that they are not eligible as colin the sales corporation; sell their lumber lateral for promissory notes of member banks. through the sales corporation on a 5 per cent commission basis. The lumber corporations NOVEMBER 26, 1917. draw drafts or bills of exchange against the SIR: In the accompanying letter the Board sales corporation, which accepts these drafts is asked whether or not in its opinion bonds and offers them, for rediscount as trade accept- issued by a Federal land bank are eligible as ances. The writer states that the business is collateral for a member bank's 15-day note. conducted on a legitimate basis and that if the Section 13 of the Federal Reserve Act proacceptances are not issued by way of credit in vides in part that— excess of consignments they could be said to be j Any Federal reserve bank may make adissued against actual existing values,. He is vances to its member banks on their promisdoubtful, however, about this paper coming sory notes for a period not exceeding fifteen strictly within the classification of trade accept- days * * * provided such promissory notes are secured by such notes, drafts, bills of exances and asks for a ruling of the Board on the change, or bankers' acceptances as are eligible subject. for rediscount or for purchase by Federal Re- If the sales corporation purchased outright serve Banks under the provisions of this act, lumber from the lumber corporations and ex- or by the deposit or pledge of bonds or notes of the United States. ecuted its acceptance or drafts in payment. these drafts might be treated as trade accept- Inasmuch as farm loan bonds are not bonds ances, although the selling corporation is a of the United States, but are issued by farm stockholder of the sales corporation, provided, land banks incorporated under Federal law, it of course, that the sales corporation is organized is clear that they do not come within the classiin good faith and not merely for the purpose of fication of securities acceptable as collateral for evading the law. If, however, the sales cor- promissory notes of member banks. poration is merely the agent of the lumber cor- Respectfully, poration and lumber is not actually sold to that M. C. ELLIOTT, Counsel corporation, the draft of the lumber company j To Hon. W. P. G. HARDING, against its agent for the purpose of procuring! Governor Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

84 FEDERAL RESERVE BULLETIN. JANUARY 1.1918. Section 5200. j In the opinion of this office these notes If Bank A, which has discounted a note for one of its jshould be treated as if they had been discustomers, later sells that note without recourse to Bank j counted in the first instance by Bank B, and B, such note becomes subject to the limitations imposed j should be held subject to the limitations of by section 5200 so far as Bank B is concerned. ; section 5200. They do not constitute a loan DECEMBER 12, 1917. •! by rediscount to Bank A, but by becoming the SIR: The accompanying file has been re-j purchaser of these notes Bank B is merely subferred to this office for a consideration of the | stituted for Bank A, and, in effect, has made a legal question raised. Briefly stated, the case ! loan to the customer of Bank A. presented appears to be as follows: i Any other ruling by your office would make Bank A having discounted certain notes for \ it possible for any national bank to violate the its customer subsequently sells these notes with- j provisions of section 5200 merely by acquiring out recourse or without its indorsement to j customers' notes through another banking in- Bank B. Query: Are such notes in the hands stitution. of Bank B subject to the limitations imposed Respectfully, by section 5200? That is to say, may Bank B M. C. ELLIOTT, Counsel. purchase such notes in an amount equal to more than 10 per cent of its unimpaired capi- To Hon. JOHN SKELTON WILLIAMS, Comptroller of the Currency. tal and surplus ? Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

.rANTJAEY 1, 1918. FEDERAL RESERVE BULLETIN. SUMMARY OF BUSINESS CONDITIONS DECEMBER 23, 1917. District No. 1- District No. 2-- District No. 3~ District No. 4-~ District No. 5— District No. 6— Boston. New York. Philadeiphia. Cleveland. Richmond. Atlanta. General business G ood on war orders; Generally active; I Good., Fairly satisfactory. Restricted only j Good. retarding on do- some lines very > I by supplies; re- ' mestic business. quiet. ' ! I tail trade brisk. | Crops: Condition., Fair Good ! Outlook... Moderately favor- do do Favorable. able. Industries of the dis- For the most part Generally active, War industr I e s Restricted output. Running full on ! D trict, i busy. with some excep- very busy; busi- sat is factory ! tions. n li e n s e s s fa i i n li ng o t o h f e f. r basis. ; Construction, build- Nearly up to last j Dull Big decrease from Rapidly declining Private building j Poor, ing, and engineer- year, but because ! last year in Phil- in volume. limited; large ! ing, of war orders. i adelphia; some volume Govern- . increase in other rnent work. ! parts of district. Foreign trade.. Practically un- Decrease com- Limited by restric-i changed. I pared with last tions and scar- ! j month. city of freight ! room. ! Bank clearings j Increase.. Decrease. ,i Very large, but Increase*. Increase I Increase. i slightly less than ] record figures i made in October. Money rates j Increasing.. Steady, at firm j Firm, with tend- Increasingly firm. Hardening: 6 per Steady. i rates. i ency to increase. cent current rate. Railroad, post-office, Decrease, except Heavy .: Increase Increase Railroad, irrogu- j and other receipts. post office. lar; post, office, I volume largo. Labor conditions Unsatisfactory Labor scarce Labor scarce and More settled.. Scarce and wages Fair. inefficient. ! high. " ! Outlook For expansion of Further a d j u s t- Unsettled i Unsettled Some uncertainty, | Good. industries engag- ments to war con- but generally j ed in war work. ditions expected. satisfactory. : Remarks. Coal shortage a Practically all bus- Inability of rail- Bank deposits j cause for grave iness dependent roads to take high; strong de- j concern. on war condi- care of traffic is maud at full j tions; solution greatest draw- rates. j of transporta- back in business tion eiuestion situation. would solve many difficulties.. District No. 7™ District No. 8-- District No. 9— District No. 10— District No. 11— District No. 12— Chicago. St. Louis. Minneapolis. Kansas City. Dallas. San Francisco. General business Generally good | Good Good Good Good Large volume. Crops: Condition :. Good except corn. Fair... Outlook Good.... do. Good | Lack ot-precipita* ! tioii. . rndostries of the dis- Very active with Very busy .j Active.. ..j Good Active ! Active and us trict. few exceptions. | I parading. Construction, build- Very dull J Quiet .i Fair to good . J Improving. Building opera- j Tending to doing, and engineer- tions dull; Gov- j crease. ing. crnraont orders i predominate. ! Foreign trade i Decrease I | In p d e o r l c la e r n s t a in b c o r u ea t s 2 e 0 . Bank clearings De m cr o e n a t s h e a f n ro d m a b l o a u s t t Increase Little change Good increase Increase I | Ab in o c u r t e a 3 s 0 e . per cent equal to same period last year. Money rates Firm Very firm.. Steady to firm. Steady j Firmer. Railroad, post office, Increase. Post-office receipts No change. Increase Increasing. fuid other receipts. increased. Labor conditions" Easy at this time.. Scarce and wages Fair Settled. Some unsettle- |More settled. high. " i ment. ! Outlook Good; scarcity of Good I Good Very good | Good i For great activity. materials, etc., i only unfavorable feature. Hetr) arks. Fuel and transpor- i Drought still seri- The definite tendtation conditions \ ously felt and ency is to inunsatisfactory. '• those portions crease in indusof district report tries contributunsatisfactory ing to war and conditions, decrease in oththough good, ers. business in more favored sections tends to offset. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

86 FEDEKAL KESEftVE BULLETIN. JANUAKY 1, 1918. GENERAL BUSINESS CONDITIONS. There is given on the preceding page a sum- tinue busy, with attention turned almost enmary of business conditions in the United tirely to the needs of the Government. The States by Federal Reserve districts. These re- wool trade is hesitant, awaiting the outcome of ports are furnished by the Federal Reserve the new requirement necessitating the offering Agents, who are the chairmen of the boards of to the Government of all wool imported if directors for the Federal Reserve Banks of the purchased after December 15 at July 30 prices several districts. Below are the detailed re- less 5 per cent. There is a great difference of ports as of approximately December 23: opinion among the trade as to the effect on prices of this regulation. DISTRICT NO. 1—BOSTON. Cotton-cloth prices remain very firm, owing So many conflicting factors arising from the to increased production costs and the high war are entering into the business situation price for the staple. Business is mixed, with that it can not be said that the trend of business some mills reporting good inquiries and some a is in any definite direction. In fact, there are ! much smaller volume. now two distinct lines of endeavor apparent, ! Plain goods are much more active than one devoted to the requirements of the war I fancies, and there are some inquiries for conand the other continuing on domestic trade. j tracts for January delivery. It is thought The former is becoming increasingly active, j from this that the market is low on goods. with demand pressing, while the latter is being | The print-cloth market is very strong, with slowly retarded- I prices advancing. The additional capital re- The coal situation is very acute, and unless ! quired to conduct business on the present high relief is found many manufacturers will be | plane is a serious problem, especially to the obliged to close. Public-utility corporations \ small manufacturer. are reducing their service, and even house- I The money market has been exceedingly holders are restricting their use of coal in this | firm during December, Payments on account emergency. Economy is becoming more gen- ; of Liberty Loan subscriptions and withdrawal eral, especially among those who have always of Government funds on deposit with qualified been accustomed to luxuries and who are now banks, together with great activity in local affected by continual demands for contribu- industries in connection with Government tions in connection with the war. : orders, has brought about a condition where In addition, the stock and bond markets are banks have been able to meet only the neceslow, and even when their losses are only on sary demands of their customers. Banks have their books the effect is to cause a restriction of availed themselves to a considerable extent of expenditures. On the other hand, many peo- ! the facilities of the Federal Reserve Bank to ple are making more money than ever before, ; care not only for commercial demands but also especially the laboring class. It is this class ! for demands arising out of subscriptions to that is doing the buying. Retail Christmas j Liberty Loan bonds. On call, money to trade is spotty and not up to last year, with brokers is firm at 6 per cent; commercial paper ; fewer luxuries being purchased and business ranges from 5| per cent to 6 per cent with year turning to useful presents. money 6 per cent. The boot and shoe industry shows no The exchanges of the Boston Clearing House change, with business of manufacturers, out- for the week ending December 15, 1917, were side of Government orders, quiet. Retail busi-; $298,274,211, compared with $280,152,120 for ness is better, but this is attributed to Christ- the corresponding week last year and $287,400,mas buying. Woolen and worsted mills con- 525 for the week ending December 8, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 37 Building and engineering operations in New change their product to adjust themselves to England from January 1 to December 12, 1917, the war situation, a noteworthy instance being amounted to $195,943,000, as compared with found in the automobile industry where com- $201,259,000 for the corresponding period of panies making both pleasure cars and trucks 1916, the highest previous year recorded. have concentrated their efforts on trucks and The receipts of the Boston post office for are running to fullest capacity, with orders November, 1917, show an increase of $119,- booked far ahead, so that their output is in 021.35, or about 26 per cent more than No- excess of the prewar production. Other vember, 1916. For the first 15 days of De- manufacturers, whose products are of a charcember, 1917, receipts^were about 4 per cent, acter likely to be considered nonessential are or $21,702.17, more than for the corresponding considering ways and means of changing their period of last year. output to war supplies or goods of an essential Boston & Maine Railroad reports net oper- character. ating income, after taxes, for October, 1917, as A tendency to economy is now distinctly $1,185,265, as compared with $1,385,762 for manifest. Business in several lines which have the corresponding month of 1916. New York, been active during the fall is now reported as New Haven & Hartford Railroad reports slightly depressed, particularly in such lines as operating income, after taxes, for October, jewelry, cut-glass ware, clothing, dry goods, 1917, as $1,874,774, as compared with $2,061,- etc. A quiet period is reported in the theater 176 for the same month last year. business, ascribed to the public's realization of Loans and discounts of the Boston Clearing- the necessity for conservation of resources and House banks on December 15, 1917, amounted energy. A natural reaction has been the to $485,833,000, as compared with $501,874,000 neglect of the theater. last month and $440,560,000 on December 16, The effects of the economy movement, how- 1916. Demand deposits on December 15, ever, are not uniform among the lines that at 1917, amounted to $411,627,000, as compared first thought would appear to be luxuries. with $448,815,000 on November 17, 1917, and Dealers in confectionery, for example, report $366,561,000 on December 16, 1916. Time excellent business up to date. Dealers in deposits on December 15, 1917, totaled $23,- groceries, wines, liquors, etc., report excellent 743,000, as compared with $25,560,000 on business. Lack of sugar alone has prevented November 15, 1917, and $30,210,000 on De- heavy increases in sales of candy. Sales of cember 16, 1916. The amount "Due to wines and liquors to dealers have shown banks" on December 15, 1917, was $121,753,- abnormal increase, ascribed to their desire to 000, as compared with $153,431,000 on No- protect themselves prior to the imposition of vember 17, 1917. war taxes and to higher prices caused by discontinuance of distilling and import of highly DISTRICT NO. 2—NEW YORK. Business developments during the past alcoholic liquors. Chain stores report steady month have been along the line of further cur- increases in business during the year, despite tailment of industries regarded as nonessential, increased costs of merchandise and shortage with continuation and increase of intense ac- of labor. tivity in the essential lines. Activity in lines Sales of men's and women's clothing have doing war work has led to the ready absorption fallen off distinctly and the number of pairs of of labor released in lines which show decreasing shoes being sold is estimated at 20 per cent to output and the general level of business 25 per cent less than a year ago, though the activity can hardly be said to have changed as money volume of sales holds up. it has for months past been at full capacity. In the dry goods line, lessened activity is In many cases factories have been able to reported, particularly in silks and woolens Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

38 FEDEEAL EESEEVE BULLETIN". JANUABY 1,1918. though sales of cotton goods continue strong, owing to labor shortage and inadequate car with large orders for export. Silk has not supply are unable to ship anything like their advanced in price to the same relative extent full capacity. A shortage of pig iron during as cotton and wool and is being bought as a the next year appears imminent. substitute, but, in spite of this and the larger The demand for machine tools is in excess volume of transactions in the volume of sales of manufacturers' capacity to produce, and in dollars than ever before, the yardage sales regular commercial work has been almost are smaller than last year. Silk production entirely put aside in favor of Government now appears to be in excess of consumption orders. and the price has dropped. There is a feeling The course of the stock market has been of depression in this line here, though sales are downward and stock and bond prices are at reported better in the West, Middle West, and unprecedently low levels. South. Money market conditions during the last The drug and chemical lines continue unset- part of November and the first three weeks tled, with high prices and retarded consump- of December have been stable, with commertion, though the volume of business expressed cial paper selling at 5£ per cent to 5f per cent. in money is maintained at high levels. Ina- Call money rates which were quite easy from bility to receive and deliver goods is particu- November 23 to 28 advanced on November larly troublesome in this line. 30 to 6 per cent and, except for a few days in Narrowing profits are reported in the paper early December, have since been steady at manufacturing industry, increases in the selling that rate. Rates for time money on stock prices of paper having been more than offset exchange collateral have ranged from 5J per by increases in wages and other costs of pro- cent to 6J per cent with little money offered. duction. Difficulty is being experienced, also, in obtaining and transporting pulp wood. DISTRICT NO. 3—PHILADELPHIA. A reflection of the lack of activity in build- Industries of this district engaged in proing is found in the reports of lumber dealers ducing supplies for war purposes have been who state that an increasing proportion of running at as near capacity as possible. Other their output is being devoted to supplying the industries, however, have felt to a consider- Government or manufacturers having Govern- able extent the circumstances which are cutment work with lumber and box shooks. ting down their output; the demand for their In the metals trade, activity centers on product has decreased, and they have been Government work. The demand for lead and unable to meet the wages which the munitions zinc appears to have fallen below the supply factories offer, so their position is far from and business is quiet in these lines. Steel satisfactory. stocks during the past few weeks have shown Reports that we have received indicate that an increase, ascribed to ocean and railroad Christmas trade is rather disappointing and embargoes, which have permitted the com- not up to normal. The impression is conpletion of domestic business instead of sup- veyed that shoppers have been influenced by plying export tonnage. By far the greater the economy and conservation campaigns. portion of the business received by the steel Furthermore, many merchants are not carrytrade is due to the activities of this Govern- ing as large stocks as has been their custom ment and the allies. Though production of heretofore, owing to their unwillingness to put pig iron is being pushed to capacity, serious in many goods at prevailing high prices and handicaps are encountered through the dif- because of their inability, in many instances, ficulties of transporting raw materials, par- to secure goods from the manufacturers. ticularly coke, while the coke manufacturers, Many people are not buying Christmas gifts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

39 JANUABY 1, 1918. FEDERAL RESERVE BULLETIN. The coal situation is now receiving nation- Financial indicators. wide attention. Coal is being mined in greater Per cent inquantity than ever before, notwithstanding crease or decrease comthe shortage of labor, but shipments are cur- December 17, pared with— 1917. tailed by the inability to obtain transporta- v P io re u - s Last tion facilities. The situation has been con- month. year. siderably aggravated by the appearance of Philadelphia banks: Loans $588,129,000 - 4 + 8 early cold weather. Some manufacturing Deposits 640,987,000 - 5 + 2 Federal Reserve Bank: plants have been forced to operate on a margin Discounts and collateral loans 34,819,052 + 116 +463 of one or two days7 supply of coal. Retail 9 C 0 a - s d h a y re d se is r c v o e u , n p t e r r a c t e e n , t per cent 49 - 1 2 4 6 - 14 9 Commercial paper, per cent 14* dealers are selling a limited amount to each individual. November, Pre- Last 1917. vious year. month Advices concerning the movement of freight by the railroads are conflicting, but the ma- Bank clearings: In Philadelphia $1,532,681,531 - 2 +20 jority of the reports indicate that there has Elsewhere in district.. 99,531,560 +11 been no material improvement and the situ- Total,, 1,632,213,091 - 3 +20 ation is still bad. Port of Philadelphia: E xports 32,309,000 -49 -22 Building operations have practically ceased, Imports _. 4,106,000 - 8 -31 Building permits in Philadelphia 1,712,520 -15 -62 except where absolutely necessar}^ There is Post-office receipts in Philadelphia 1,077,115 +11 +30 Commercial failures in district (per a decided scarcity of houses for working people. Bradstreet's) , 165 It will not pay builders to erect houses for i Actual. renting at the prevailing prices of materials DISTRICT NO. 4—CLEVELAND. and the uncertain conditions of labor, particu- This is a period of readjustment and curtaillarly if it is felt that it is only a matter of time ment. Manufacturers are remodeling their before there will be a material decline in rentals. plants to make the essentials and are elim- At the present time the building material inating the nonessentials. Merchants report industries are considerably depressed. many customers buying those articles which The farmers are most seriously handicapped are necessary to the support of life and leavby the scarcity of labor, and no remedy is in ing on the counters the unnecessary. The key sight. Owing to this difficulty the acreage of words are "essential" and "necessary." Along winter wheat is not expected to be as great these lines business is readjusting itself. as was hoped. Business, except on Government contracts The prevailing prosperity of labor would and strictly necessary lines, is not good. The make it seem that calls on charity organiza- manufacturing industries, such as glass, pottions would be very few this winter, but the tery, steel, etc., for domestic use, wait on transgreater cost of food has resulted in the demand portation and labor, the controlling factors of for charitable help being as large as last year. the situation. Until these two elements are The total of the Christmas savings fum able to do their part, no decided betterment carried by the banks in this district is upward can be expected. of $10,000,000, which is about $500,000 ahead Agriculture.—Winter wheat is reported doing of last year. The number of depositors is well. The heavy snows in most localities have approximately 350,000. protected it from the severe weather. The Payments on account of Liberty loan sub- unmatured corn is being fed to cattle and hogs. scriptions have caused a shrinkage in loan- In many cases the farmers are purchasing from able funds, and money rates have been firm the stockyards underweight and undeveloped as a result. Call money advanced to 6 per animals and fattening them with the unmarcent and the rates for commercial paper to ketable corn. By this means a profit is made 5f per cent. and the meat supply of the country increased. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 FEDERAL BESEEVE BULLETIN. JANUARY 1,1918. The cold weather has retarded the market- Labor.—Generally both skilled and common ing of the tobacco crop, and it is not as yet well labor continue scarce and exacting. In one under way. However, it is selling at the high- quarter there was reported unemployed labor est price in its history, and should soon relieve occasioned by the shutting down of a large any money stringency in the tobacco districts. plant engaged in the manufacture of non- Manufacturing.—The output in many lines essentials. This, however, is the exception, is being curtailed by the transition from regu- and in this instance employment was soon given lar activities to the making of strictly war in the same plant, it having been remodeled to goods, by the increasing strictness of Govern- accept Government contracts. mental requirements whereby nonessentials are Women continue to take places in the labor sidetracked, and by the shortage of coal, coke, world formerly occupied exclusively by men. labor, and transportation. They are said to do the work satisfactorily. The rumor of lower prices for the beginning Employers and employees are gradually adof the year in the steel business has unsettled justing themselves to the changed conditions, the market and confined buying largely for the and, as a whole, there is believed to be a slight account of the Government. Orders on hand improvement. are in fair volume, and Government orders are Building operations.—The severe cold increasing. weather has interfered with building opera- The clay industry is very quiet, and ship- tions. The demand for dwellings is still strong, ments are about one-third the volume of last but the cost of materials deters contractors year. from attempting new projects, and conse- The coal trade is badly handicapped by lack quently the line, with few exceptions, shows a of cars. In some quarters mines have been steady decline in volume. compelled to close down on this account. Money and investments.—The money market Mercantile lines.—Jobbers for the most part is firm. Legitimate business is experiencing are experiencing the usual holiday slackening little difficulty in securing funds for financing in trade, and orders are of the "fill-in" variety. its normal needs. Banks, however, report that In the retail trade Christmas shopping holds money for speculative purposes and those not the way and promises to exceed last year's in harmony with the spirit of the times is not business in money value. In many quarters advanced. It is probable that the demand for it is reported that purchases are confined largely money reached its peak the week of Decemto those articles which are useful and neces- ber 15. sary rather than to decorative novelties and Investment markets are lethargic and conthe unnecessary. tinue to give the right of way to Government Collections.—Collections are reported promptfinance. and satisfactory, probably partly due to scar- The rediscount demands with the Federal city of goods, prompt payment being a requi- Reserve Bank of Cleveland from member banks site for securing future consignments. are very heavy, as the appended comparative Increases in wages and unusually large pay table will show. rolls at this season of the year should continue Rediscounts during second Liberty loan, 1917: Nov. 15 $18, 938, 681. 00 to keep collections at normal. Dec. 1 31,880,178. 38 Transportation.—In some localities the car pec. 15 49,117,574.12 shortage is very serious, compelling the closing Rediscounts during same period last year, 1916: of mines and factories and causing hardships Nov. 15 $289,656. 06 and discomforts in many places from lack of Dec. 1 245,805.71 Dec. 15 1,477,077.53 fuel and necessary foodstuffs. Rediscounts during first Liberty loan, 1917: Railroad officials are hopeful concerning the June 15 $3,524,117.20 situation and believe that traffic conditions will July 2 9,098,426.51 be ameliorated. July 16 7,423,364.84 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL BESEEVE BULLETIN. 41 DISTRICT NO. 5—RICHMOND. cent, and deposits in banks are high. The em- There is little change in local conditions and bargoes on freights, however, particularly at activities in the district during the past month. the ports where cotton shipments are largely Reports indicate irregular and in some cases handled, are creating a large demand on the adverse conditions as heretofore, mixed with banks for financing. Shipments are delayed in singularly general prosperity. The people in coming in and have to be financed until arrival, general appear to be well supplied with and are slow in going out, resulting in delay in money and retailers particularly have had a realizing on them. These conditions, coupled demand for goods in excess of available sup- with Government financing, referred to above, plies. Food products in some lines are only have resulted in hardening rates and the active in limited supply, but there has been no real employment of banking resources, suppledeprivation, and the current discussions on the mented by borrowing to a very considerable subject have bordered on exaggeration, to say extent from the Federal Eeserve Bank. Loans the least. and discounts in the bank have reached the Agricultural activities are naturally at a highest figure ever attained. standstill at this season, and unprecedentedly Supplementing the appeal of the President severe weather, even for this time of the year, to State banks and trust companies to become a heavy fall of snow being one of the accom- members of the Federal Reserve System, all panying features, has brought serious discom- banks in the district have had the matter urged fort and has interfered considerably with trans- upon their attention. This is being followed portation and general activities. by personal correspondence direct from the National financing has been the most impor- bank, and from a committee of the American tant factor dealt with during the month, both Bankers' Association and the State Council for in discussion and in its practical bearing on the National Defense. This has aroused some infinances of the district. The unavoidable delay terest among nonmember banks, several of the in the delivery of the definitive Government largest banks and trust companies in the disbonds, due to the unprecedented task involved trict have joined the system, and other appliin the printing and physical preparation of cations are anticipated. We quote the followthem, has apparently increased to a consider- ing from a circular recently issued by the comable extent the borrowing necessary in the missioner of banking in one of the States of financing of them. It has apparently delayed our district: and interfered with the distribution and final liAs I view it, the matter is both a patriotic absorption of them, but subscribers should ap- duty and an economic expediency. Aside from preciate the difficulties attending such enor- the great need at this time for an efficient mous and unexpected financing, and regard any mobilization of the banking resources to fortify our Nation in meeting extraordinary war conlittle inconvenience they may have suffered, ditions, in my opinion, membership^ going to and which has been absolutely unavoidable, as prove very helpful in solving future problems a part of the self-sacrifice all are called on to and meeting contingencies that are sure to make. arise during the readjustment period after the war. Just now our Nation and the Federal The industries of the district are actively em- Reserve System need the support of the banks; ployed, production only limited bj scarcity of later the banks are going to need the support supplies and labor. There is a general tend- of the system, and now is the time to make ency to economy and thrift, although the view the alliance.77 is expressed in some quarters that high wages have had a tendency to increase food consump- DISTRICT NO. 6—ATLANTA. tion among wage earners. There has been no unusual developments Collections are reported good; clearings con- i in the general business situation of this district tinue to indicate an increase of about 27 per I during the month of December. Reports from Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

42 FEDERAL BESERVE BULLETIN. JANUARY 1,1918. all over the district indicate a heavy Christmas operating companies recently announced additrade, and the district enters the new year tional expenditures [of $11,000,000 for their under the most prosperous conditions and with shipbuilding project near Mobile. the brightest prospects. The labor situation, while somewhat acute in The closing of the second Liberty Loan and certain parts of the district, has improved in the payments of installments appear to show the coal mining district. Quite a number of but little disturbance in financial circles. the negro miners have returned from the north- Large expenditures of the Government for ern fields. materials and provisions incident to supplying Generally speaking, the industrial expansion the many Army camps in this section largely is limited only by productive capacity and offset the withdrawal of funds on account of transportation facilities. Liberty bond sales. The exceptional cold wave during the latter DISTRICT NO. 7—CHICAGO. part of the month interfered considerably with Business in practically all lines is moving at general business, and especially with transpor- a rapid pace and the principal factor is the tation, and general products and fruits have scarcity of the essentials of labor, transportareached higher price levels. The weather, tion, fuel, and materials. A few industries, however, has proved very favorable for the however, through the lack of fuel and material, killing and packing of meats for winter use, have been compelled to cut down their workand the farmer is better prepared in this respect ing force. There is little effort for new busithan in former years. The sugar refineries at ness, as concerns are working at capacity to Savannah, which have been closed on account turn out that which comes to them unsought. of the inability to procure the raw supplies, are Holiday trade will probably [be less than expected to resume operations after January 1, usual. when the new crop of sugar from Cuba will The investment market has been narrowed begin to come in. The citrus crop will be to such an extent that adjustments looking to short, being estimated at 3,500,000. The reduction of forces are taking place. Investfreeze last spring reduced the crop of celery in ment activities are practically confined to Florida from 25 to 30 per cent, cutting down short term corporate notes and municipals. the average yield to 500 crates per acre. This It is reported that the large November and year the acreage is somewhat below that of December maturities in investors7 hands have last year, but with an ordinary year the yield been satisfactorily met. The corn crop is in will be greater. itself a great disappointment, though there is The one item of special interest in the indus- some solace in the fact that this condition has trial activities is the growing shortage of coal. augumented, to a considerable degree, the At several of the largest centers a number of the feeding of live stock. Heavy snow has been schools have been forced to close, and we have decidedly favorable to winter wheat and rye. reports of one or two large plants being shut Cold weather has, if anything, operated to the down on account of lack of fuel. Miners and improvement of the corn situation. Large operators in the Tennessee field and also in the acreage of winter wheat is reported. The bean Alabama field recently held conferences and |and potato crop is not being freely marketed appear to have made general headway toward Iowing to transportation difficulties. a satisfactory agreement, and some relief from j Money rates are expected to remain hard the shortage of coal is promised. Iindefinitely, due to Government financing, The proposed establishment of Government!immense business activity, and soft corn situanitrate plants and powder mills at Mussel tion which brings the farmers to the banks as Shoals, in northern Alabama, has created un- borrowers at a time when they are usually in usual activity in that section. One of the large funds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 43 Scarcity of labor and materials is a matter of maintain this grain at high levels. A fairly serious consideration to agricultural imple- good export business prevails. ment manufacturers; otherwise, a good spring Wholesale grocers find a ready sale for their business is anticipated and collections are products with the scarcity of material a factor. good. Canners face high prices for sweet corn, Automobile concerns are seeking to divert tomatoes, beans, and the like. Volume is their facilities into other channels, such as the about normal and collections very satisfactory. manufacture of aeroplane engines and bodies, Hardware concerns report a satisfactory trucks, and ordnance parts, which will secure volume of business for this time of year. Purfor them Government contracts. Pleasure chase of necessities and Christmas goods form automobile business will be greatly restricted. the bulk of trade in this line. Conditions are Collections have tightened somewhat. normal. Collections are unusually good. Building is practically at a standstill, due to The month of November saw a falling off in the season and to scarcity of materials and the the jewelry business, though the period from car shortage. Collections are good generally, the first of 1917 showed a fair increase over the though some complaint is heard with regard corresponding period in 1916. Business conto country collections. tinues to decline for the first two weeks of Coal miners are unable to satisfy demand, December, 1917. A dull holiday season is the extremely cold weather depreciating the anticipated. Collections are good. efforts made to fill the already pressing re- The leather industry reports extreme quiet quirements of manufacturers. Car shortage in civilian business. Government orders are is also an unfavorable element. keeping some houses at capacity, while those Export demand would afford a broad market without Government contracts are slowing for distillers' products were it not for the diffi- down with little promise for the future. Heavy culty with shipping restrictions and scarcity of hides for Government work are in strong deocean bottoms. Domestic business is quiet mand. Collections vary from good to exceland no activity is anticipated for the duration lent. of the war. The live-stock situation continues to be It is suggested that hoarding of stock is affected by soft corn. As reported last month, responsible for some of the advanced prices at this has resulted in an unprecedented demand which dry goods are being sold. Wholesalers fo;r feeding cattle and banks serving agriculreport a considerable volume of speculative tural communities are experiencing a brisk buying. A satisfactory volume of retail busi- demand for funds. Receipts of animals at ness has resulted from the seasonable weather yards are somewhat lighter, the quality apof the past few weeks. Collections are better parently good. It is said that meatless days than normal. are affecting domestic demand, though, of Furniture houses are reasonably well occu- course, foreign demand is very active. One pied with new business; factories are retaining authority questions the food value of soft corn most of their employees, though orders are and suggests that this may tend to bring inrather light. Collections are good. ferior products to market. An agreement Considering the large crops of wheat, corn, recently reached between the Food Adminisand oats, prices have ruled high. Corn of tration and the railroads as to hauling of good quality brings a high price, though there live stock from prescribed zones will regulate has naturally been some decline in the lower the volume of receipts. Prices trend downgrade, which was forced to the markets on ward. Collections are good. account of its poor quality. Speculation is I In the lumber business the car shortage is blamed for small receipts of oats, though acute, but it will work no particular hardship transportation deficiency likewise operates to at this time, which is usually slow. Building Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

44 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. operations are practically at a standstill. DISTRICT NO. 8—ST. LOUIS. Collections are fair. Business activity in this district has contin- Mail-order houses report business at about ued unabated during the closing month of the the same volume as last year. year. Holiday shopping had a stimulating Piano manufacturers are experiencing the effect on retail trade, and department stores customary holiday demand with little hope of and merchants handling holiday goods report filling all orders due to subordination of their that a large volume of business was transacted. transportation requirements to those of the Some state that the volume was greater than Government. Collections are very good, with that of 1916. This, however, would seem a scarcity of skilled labor. There is a dispo- to mean that, measured in dollars, the volume sition to be noncommittal as to prices and was larger, but the number of transactions deliveries for 1918. was doubtless less than last year. An interest- Shipbuilders are still employed to capacity ing feature of this year's holiday purchasing and labor is scarce. was the fact that the public bought more The steel industry is working at capacity to useful articles. fill war orders. Constructional steel is not in Manufacturing industries in this district congreat demand. Production of pig iron is not tinue active, Government orders being an imkeeping pace with orders and there is some con- portant factor. Clothing manufacturers are cern among consumers. Lack of transporta- working overtime, and manufacturers of shoes tion is seriously affecting production. It is are also busy. Manufacturers of munitions, noteworthy that the month of November saw machinery, tools, implements, and allied lines, the smallest decrease in United States steel are working to capacity, and the drug and unfilled tonnage (8,897,106) since the decrease chemical lines are also extremely active. began in May, 1907, from the high point That there is a feeling of confidence in this (12,183,083) in April, 1917. It is believed district is evidenced by the fact that both that steel buyers have given lip hope of lower manufacturers and distributors are buying prices or greater ability to fill orders. freely and some new enterprises are being Wool purchases are being made for immediate launched. Business men are becoming reconrequirements. Still, prices remain firm, as ciled to the taxes and restrictions imposed by imports are curtailed, owing to the unwilling- the Government and are settling down in a ness of the importers to comply with require- grim determination to bring the war to a sucments of the Trade Council in securing import cessful conclusion. licenses. This will cause encroachment on Prices on commodities continue high, but present stocks. have not yet reached a point where the demand Clearings in Chicago for the first 19 days is curtailed. The supply to consumers of of December were $1,338,000,000, being certain commodities is being limited to so $1,000,000 less than for the corresponding 19 much per family within a specified time. days in December, 1916. Clearings reported Snowfalls throughout the district during by 23 cities in the district outside of Chicago December furnished the much-needed moisture amounted to $303,000,000 for the first 15 days for the winter wheat, and this should help it of December, 1917, as compared with materially. Government reports issued during $304,000,000 for the first 15 days of December, December indicate that approximately 42,170,- 1916. Deposits in the twelve Central Reserve 000 acres in the United States were sown in City member banks in Chicago were winter wheat this fall. The condition of the $845,000,000 at the close of business December winter wheat on December 1 was reported 19, 1917, and loans were $606,000,000. Deto be 79.3, as compared with a 10-year average posits show an increase of approximately condition on the same datp of 89.3. It is fore- $8,000,000 over last month and loans an incasted that the present acreage of winter wheat crease of approximately $12,000,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDEEAL EESERVE BULLETIN. 45 will yield 540,000,000 bushels. This is some- There has been a good demand for money, what below the mark set by the Government, especially in the large centers. This has been and already steps are being taken to insure a due to the general business activity and also large increase in the acreage of wheat to be to the fact that the increased cost of materials planted next spring. and higher wages require considerably more The total production of cotton in the States money to conduct business enterprises than within this district during 1917 was estimated formerly. The bank rate to customers conby the Department of Agriculture on Decem- tinues at from 5J to 6 per cent, with the rate ber 1 to be 2,247,000 bales, as compared with in the outlying districts somewhat higher. 2,270,948 bales in 1916, and 2,507,723 bales As a rule, the large city banks have not been for the last five-year average. In Arkansas in the market for commercial paper. There and Tennessee the crop this year was con- has been a fair demand, however, from country siderably less than last year. banks in certain localities for commercial paper. The shortage of cars continues to be a The rate has ranged from 5f to 6 per cent, the serious handicap to business. Largely on this former applying mainly to short maturities account, in some localities it has been impossi- and the latter to maturities of from four to ble to get enough coal to meet the demand, six months. and it has been necessary for some shops in this On December 3, 1917, the Louisville branch district to shut down on account of lack of coal. of the Federal Reserve Bank of St. Louis was During the past month, there has been a opened. decided decrease in the receipts of all live stock in the St. Louis market, except horses and DISTRICT NO. 9—MINNEAPOLIS. mules, which show quite an increase over the Threats of serious labor troubles in St. previous month. However, there have been Paul and Minneapolis, growing out of friction increases over the previous month in the sales between the operating company and streetof live stock, with the exception of hogs, the railway employees, promised during the early sales of which show a decrease. part of the month to involve numerous labor The postal receipts for November in St. unions in a sympathetic strike. The action Louis, Louisville, Memphis, and Little Rock of the State Public Safety Commission in all show substantial increases over the corre- Minnesota brought about an adjustment of sponding month last year. the situation, and the danger of serious inter- Reports from the leading cities in this ference with business and industrial activities district indicate that during the month of was averted. November there has been a decrease in both Labor conditions elsewhere have been satisthe number of building permits issued and the factory, and with all industrial concerns runestimated cost of construction in comparison ning to capacity and large orders ahead, labor with the corresponding month last year. is fully employed at good rates of pay. During December the outstanding financial Banking conditions show little change. features in this district have been the with- The demand continues good, with rates very drawal by the Government of over $60,000,000 firm. Retail trade has been satisfactory, exof the funds on deposit in the banks in this cept that at the larger centers holiday buying territory, and the second payment on the has not been quite as brisk as a year ago. Liberty Loan bonds, amounting to approxi- A serious situation developed during the mately $17,000,000. These were effected with month through investigation of agricultural no disturbance to business, due to the Federal experts, who have been unable to find any Reserve Bank. Such member banks as found considerable amount of seed corn for next it necessary rediscounted paper with it. year's planting. Exceptionally early frosts Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

46 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. prevented the greater part of the corn in the at practically full capacity for the first time Ninth Federal Reserve District from maturing, in some months, with an increased output of and most of it was caught in October by severe 5 per cent over the same month a year ago freezing weather, followed in November by and some wheat accumulation in the smaller warm, foggy days, the combined effect of mills. Millers are complying with the reguwhich was to produce mold and destroy the lations of the authorities in the finest spirit seed value of a large amotfnt of corn that other- of cooperation, but are finding it difficult to wise might have been saved. North Dakota set flour prices within the rules, as a slight is practically without seed. It is estimated fluctuation in wheat receipts produces flucthat less than 20 per cent of the corn crop in tuation in cost. The steady decrease in stocks Minnesota will germinate, while only about 4 of wheat and corn in the elevators during the per cent is what would be called good seed past months has been checked, wheat stocks corn in an ordinary year. In view of the increasing 62 per cent during the month and seriousness of the situation, the cooperation of corn supplies doubling those of October. all the banks in all parts of the district was The car shortage slightly affected the corn invited, and during the month seed-corn warn- movement for November, which was, however, ings were sent out to many thousands of about normal, while an urgent demand kept farmers cautioning them to go over any corn the prices higher than ever before. With hay on hand and immediately select, dry, and test selling at more than double the price a year the seed ears in order to provide their own sup- ago, there was a larger movement on the local plies for spring. market than for any previous month this year. Efforts were also put in motion to ascertain The hay crop of Nebraska is now estimated what amounts of surplus seed individual farm- at about 28 per cent less than last year. ers may have and arrange for its purchase and Owing to a continued general drought and a shipment to points where there is no seed to shortage of labor, Kansas farmers failed to be had. It is very possible that even with the reach the wheat acreage goal of 10 millions most active cooperation of banks, business set by the national food administration. The men, and farmers that it will be impossible to total wheat acreage of that State is nine and a secure and distribute enough seed to prevent half millions, or 1 per cent less than for iast a sharp reduction in the corn acreage planted year. The general condition of winter wheat in 1918. Attention is also being given to the in Kansas is 70 per cent, in Oklahoma 51 per seed problem as it affects small grains and to cent, and in Nebraska about 80 per cent. A the conditions in parts of North Dakota and strenuous effort has been started in Nebraska Montana, where because of the crop failure this to secure a large acreage of spring wheat to year farmers are very short of feed and forage., offset the winter shortage. As a consequence of the feed situation a con- The value of Colorado crops for this year is siderable amount of stock has been shipped said to be a half greater than for any other out of both North Dakota and Montana, in- previous year, and the cultivated acreage about cluding many breeding animals that farmers 15 per cent greater. The bean crop in that have not found it possible to carry over the State has been greatly increased till it will winter. be nearly a sixth of that for the entire countrylast year. Notwithstanding some damage by DISTRICT NO. 10—KANSAS CITY. frost, the potato crop of that State shows a Agriculture.—The wheat movement in No- third increase over 1916. vember was less than one-half as large as a Live stock.—The demand for hogs has been year ago and less than one-third that of two strong, with prices maintaining a high level, years ago. Under the supervision of the food prices declining during early December from administration, mills have been able to operate the former high figure. Those offered have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL BESEBVE BULLETIN. 47 been of the highest grade marketed this season, than last year and were increasing at the beaveraging 18 per cent heavier than for last year. ginning of December. Receipts for November declined 40 per cent Colorado has this year increased her coal from a year ago, owing to the shortage of last output a fourth and reports that their diffiyear's corn crop and the lack of late summer culty is not lack of fuel but lack of cars to feed. move it. The possibility that alien enemies The prices for cattle broke from $1 to $3, but may be excluded from the vicinity of the rallied 50 cents by the end of November. The mines caused some apprehension in the minbig range movement of cattle is almost over ing districts, where most of the workers are for the year. It continued this season logger Austrians who have not yet become fully natthan usual because of the drought conditions uralized and are unable to secure final naturaliin the Southwest, causing a scarcity of pastur- zation papers on account of the condition of age in the wheat fields and in the grass regions war. of southwest Texas. The large war contracts According to the reported statement of a for meat resulted in a demand for the common scientist in a Kansas State institution, there class of cattle, but the demand for higher grades is enough sulphur now going to waste at the used in local trade was light. zinc smelters of this district to supply all the An increase in sheep receipts was registered, needs of the country for sulphur and sulphuric due to the late movement of feeding lambs acid and in form to be obtained at a profit by through the market. Prices were much higher. commonly used methods. The movement of both cattle and hogs from Oil.—The most important feature of the oil the markets for feeding on the farms has been situation in this district has been the gradual strong all year. The soft condition of the corn decline of stocks and a lessened development in became apparent in October. This greatly the Mid-Continent field for November. As stimulated winter feeding, so that during No- there has been less difficulty in getting supplies vember shipments to the farms increased over and labor than formerly and the weather aver- November last year nearly a half for cattle and aged no dryer, the only reason that has been six times for hogs. For the first 11 months of given for the checking is a psychological one. the year compared with the same period a year The total number of wells brought in in the ago the stocker movement increased a fifth for United States for November fell off a seventh cattle and one and one-half times for hogs. and production from them was more than a The former prediction of a more plentiful meat third less than for October. The same proporsupply for next year seems now to be even tions hold for the Mid-Continent field, although more justified than when it was made. Kansas doubled her production of a year Mining.—The Missouri - Kansas - Oklahoma ago. lead and zinc district this year produced nearly Operations continue active in Wyoming and a third more zinc and a fourth more lead than Colorado. In the first-mentioned State 30 last year. The zinc market has been unsettled wells were completed in November. The profor some time, averaging far below the figures duction of these new wells would equal nearly for a year ago. During the one month of No- half the entire production of the State last year. vember there was a decline of 11 per cent. Operators are expecting to continue the work Smelters have been advancing money on ship- of drilling through the winter. ments and storing the ore, but are no longer In Colorado a survey of the shale-oil reable to do so. This condition, coupled with sources has been arranged for under State suthe falling market, has resulted in the closing pervision. A Government official has been of many mines in Kansas and Oklahoma. The quoted as estimating the total possibilities at prices for lead have averaged a fourth more 20,000,000,000 barrels, from which 2,000,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

48 FEDERAL BESEBVE BULLETIN. JANUARY 1,1918. barrels of gasoline could be obtained, together ment of the coal mine troubles, and so far as with vast quantities of ammonium sulphate for reported none are contemplated. fertilizer. A new and shorter process has been Mercantile.—Trade continues very active in patented for extracting the oil from shale, and nearly every line and collections are good. pioneer development along this line is now The cold weather has stimulated heavy buying going on. in winter clothing of all kinds, and the holiday Casinghead, a gas that escapes from the trade has been very heavy. In this connecmouths of oil wells, is now being utilized in tion there has been especial development in making gasoline in Oklahoma, and its value is the sales of all forms of goods and articles for proving greater even than was first estimated personal use in the Army. when its conservation was first undertaken by Sugar is scarce. Lumber sales are increasthe State. ing. Hats, shoes, clothing, groceries, and^ pro- Lumber and construction.—The lumber trade visions are moving rapidly, and in many cases is beginning to recover from the depression of the difficulty is not in selling but is in getting the past few months. Building in the cities the goods. Distributing houses find it diffishows an increase over a year ago, but is con- cult to keep up with the demand of the country fined to the construction that must be done for dealers, in all forms of farm machinery and business purposes. gasoline-power machines. The slowing up of Mill stocks are badly broken on account of sales of pleasure automobiles continues, as supplying unusual Government needs, and does the increased sales of trucks, tractors, shipments are made with increasing difficulty tires, and accessories. in securing cars. Many country dealers al- Failures have been few and confined to busilowed their stocks to become low during the nesses whose capital was too small to properly fall when demand was so light. They are now handle purchases and credits at the present ordering to supply the building that farmers high prices. They are nearly a half less than are doing and are finding it difficult to get for a year ago, as compared with a reduction of their orders filled and shipped. Local dealers a tenth for the entire country. The liabilities are optimistic notwithstanding the fact that of those concerns failing averages about $6,000. they expect the transportation troubles to be- Financial.—The continued business activity come more acute and not to be relieved till is shown in bank clearings during November, next spring or summer. two-thirds greater than for the month last year Labor.—The demand for laborers of all and more than twice as great as two years ago. classes continues strong. The condition of Money rates have not changed and the demand soft corn has checked the demand on the farms remains about the same, being perhaps slightly and the increased use of gasoline for power less than for the previous month. purposes has assisted, but the great demand caused by the withdrawal of young men for DISTRICT NO. 11—DALLAS. the Army has not been entirely satisfied. Ne- Extremely cold weather has prevailed during braska reports indicate that the State council December, and has been especially beneficial to of defense, acting with national authorities, wholesale and retail trade. Dealers in the handled the farm labor problem in a most satis- larger cities who handle such lines report that factory manner. they have enjoyed a good volume of business While the economic questions that have during the month, and sales are ahead of last brought about strikes have not, of course, been year. Manufacturers are active, with collecdisposed of, for the time being, the strike situ- tions good. Mail-order houses are enjoying a ation is very satisfactory. No disturbance of large business. Manufacturers of saddles and any importance has occurred since the settle- harness are exceptionally active, and dealers in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUABY 1, 1918. FEDERAL RESERVE BULLETIN. 49 hardware, paints, and similar lines report in- tion via the southern Gulf ports to a marked creased sales. extent, and exports from Galveston conse- As the crops of the past season have all been quently showja decrease. Texas City, also one marketed, there is little of interest to report of of the largest ports in the district, has suffered agricultural conditions. The heavy freeze the greatly. Reports received indicate that on acearly part of the month killed insects, and the count of the congestion at the northern ports scattered rains have put the ground in gener- there will be a diversion of shipments to the ally good condition for preparations for next South at an early date, when it is expected year's crops. Reports indicate that farmers exports from Galveston, Texas City, and are preparing their land for 1918, and the acre- other ports in the' district will materially age will be materially increased. More rain is increase. badly needed in some sections before the ground The banking situation is satisfactory. An can be sufficiently worked. analysis of the reports received from member While there will probably be a curtailment in banks, on the Comptroller's call of November the purchase of luxuries and nonessential arti- 20, discloses heavy deposits, especially in more cles, which is a condition quite desirable, re- favored agricultural sections, and a generally ports indicate that the volume of holiday trade sound condition. Banks in the sections menwill be heavy, and probably equal that of 1916, tioned are carrying heavier deposits than at the when merchants in the larger cities of this dis- same period of 1916, when all previous records trict had an unprecedented business. were broken. The demand for money con- While building operations continue dull, and tinues good. Some banks are purchasing reports from the larger cities state that the prime commercial paper as an employment of number and value of permits issued during their surplus funds. There has been no notice- November were small, manufacturers of brick able increase in interest rates, and they remain and other building materials report that the car easy. The campaign for the purchase of Warsituation has improved, and their November Savings Certificates is now on, and is meeting business was better than in recent months, with with good results. collections good. Demand for lumber from the Clearings at the larger cities during Noveminterior trade is more than sufficient to employ ber, reflecting the heavy fall and winter busiwhatever cars are available, and while the vol- ness, were $351,898,194, an increase of 36 per ume of shipments is not up to normal, prices are cent over November, 1916. satisfactory, and collections in the trade are Post office receipts at the principal cities for good. The production is probably not more November show an increase of 51 per cent. than 85 per cent of normal, due to various con- The increased postage rate, of course, accounts ditions and a shortage of labor. All of the for a substantial portion of the increase, as well mills in the "long leaf'7 territory are busily en- as the seasonal business in parcel-post shipgaged in the production of lumber for ship- ments. building from such portion of their timber as is There has been little change in the cattle inadapted to this purpose. At Orange, Tex., dustry. There were few losses from the exwhich is in the center of the lumber region of tremely cold weather of the month, but range southeast Texas, some 40 Government vessels conditions have not improved. Ranchmen are are now under^construction, furnishing employ- burning cactus in some sections to keep their ment for 4,000 men, with a weekly pay roll of herds alive. The outlook is not good. $50,000. This activity has made business good Labor conditions have not changed within in all lines. the month. There is a general shortage of The concentration of shipping at the North men, and notwithstanding attractive wages Atlantic ports has reduced water transporta- the situation shows no improvement. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 FEDERAL RESERVE BULLETIN'. JANUARY 1,1918. DISTRICT NO. 12—SAN FRANCISCO. live stock in the Northwest. In Oregon, Wash- Lack of precipitation has been an unfavor- ington, and Idaho the holdings of hogs are at able agricultural factor throughout this dis- present 2,550,000 plead, compared with trict during the fall. In Washington fall 3,920,000 head at the same time a year ago; of plowing was restricted by dry weather, and cattle 915,000 head, compared with 1,790,000 wheat, which was planted in the dust, did not head a year ago; and 380,000 dairy cows, germinate effectively. Rains in the first part compared with 510,000 in 1916. Holdings of of December in the Walla Walla (Wash.) dis- sheep and lambs alone show an increase, being trict and snow in the region of Spokane 4,340,000 head compared with 4,260,000 head (Wash.) have tardily bettered the prospects a year ago. The campaign for more sheep for winter wheat. In California the precipita- and more wool has been influential for an intion for the season beginning October 1 has not crease, but extraordinary prices have likewise been 10 per cent of normal. It is, of course, been a potent influence. not a definite indication that there will not be Labor conditions, which have been very unabundant moisture later, so as to assure the settled during the year, appear to have reached crops for 1918, but the continued dry weather a state of greater stability. There have been occasions concern. strikes in copper mines of Arizona, in lumber The Pacific Coast potato crop is reported as mills of the Northwest, in shipyards and 48,105,000 bushels, an increase over last year allied metal trades, not only in San Francisco, of 3,105,000 bushels, an increase of 7 per cent but also in Portland and Seattle. There has The acreage however increased from 216,000 to been a telephone strike at Seattle and a bitter 328, 000 or 52 per cent. The barley crop in and violent street car strike in San Francisco. California aggregated 40,000,000 bushels, which The intervention of the Federal Wage Adjustwas an increase of 17,000,000 bushels over 1916. ment Board, Secretary of Labor Wilson coming There has been a general effort to increase himself to the Pacific Coast, was effective in acreage and this has been the cause of an reaching settlements in several cases. The increase in some products. The season, how- intervention ordinarily resulted in prevailing ever, which has just closed has not been gen- upon employers to concede the demands, in erally favorable for agricultural products in large part, of the striking workmen, but at all this district. It is in spite of this that the events a basis was usually reached under summary of totals shows that the aggregate which the processes of production were retonnage was exceptional. sumed. The supply of farm laborers, which has been In southern California canning tuna fish has inadequate during the past year, and which become an important industry, large contracts has been diminished by the draft, promises to having been made with the Government for be materially short of the needs during the Army needs. The salmon pack of the Northcoming year. The suggestion is being made west, however, is the great fish industry. The with increasing frequency that a large number, value of the 1917 salmon pack in Alaska alone perhaps 200,000, of Chinese farmers be brought is placed at $30,000,000, comparing with to this country, under bond for their return, to $21,000,000 in 1916. raise crops during the war. Cuba has pur- Shipbuilding has advanced with huge strides. sued this course to secure labor for handling the Both steel and wooden ships are under concrop of sugar cane. Apparently no objection struction in large numbers at Seattle and is made to the proposal except by labor unions. Portland, while San Francisco is doubling and Curtailment of available range for feeding, quadrupling her facilities for building chiefly the high price of feed, and inability to secure steel ships, and Los Angeles is also engaged in labor have resulted in the marketing of much important construction. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 51 The construction of buildings is decreasing, After setting apart the gold and gold certifireports from the principal cities of this district cates legally required as vault reserves, Calishowing a decrease of 17 per cent during the fornia State banks and trust companies have past five months. now such vault cash that they could exchange Imports and exports, measured in dollars, approximately $20,000,000 gold and gold cerare at record figures in spite of deficient ton- tificates for Federal Reserve notes. As the nage. Seattle leads San Francisco in foreign Federal Reserve Bank would pay transportatrade, the estimated figures for 1917 being, tion charges both ways, this could be done not respectively, $410,000,000 and $320,000,- only without expense to them but also without 000. impairing their reserve position. Such an ad- Petroleum production in California during dition of $20,000,000 gold to the reserves of November was 8,112,170 barrels, while ship- theFederalReserveBankwouldadd$30,000,000 ments were 9,303,660 barrels. This excess of to its lending power if proceeds were paid in consumption reduced stored stocks by 1,191,- Federal Reserve notes. The opportunity for 490 barrels to 32,603,625. On December 31, patriotic service in thus strengthening the 1915, stored stocks were 57,147,051 bar- Federal Reserve system to meet the Nation's rels. financial strain is open to every California State Bank deposits and bank clearings continue bank whether small or large and whether to expand. Lending rates of member banks member or nonmember. have tended to greater firmness and there has At the end of the year 1917, Federal Reserve been considerable rediscounting with Federal Bank of San Francisco paid a semiannual Reserve Bank, but all legitimate requirements dividend amounting to approximately $298,000, of borrowers are being readily met. The in- covering accrued dividends upon its outstandfluence of Federal Reserve Bank in imparting ing stock at the rate of 6 per cent per annum financial stability and confidence is very from October 1, 1915, to December 31, 1916. marked. This influence is being steadily en- The semiannual dividend paid June 30, 1917, hanced as the exchange is made of Federal amounted to approximately $108,000, making Reserve notes for gold, the banks' reserve a total paid during the year of approximately thereby being continually expanded. The $406,000. The dividend requirements at 6 issue of Federal Reserve notes is frequently per cent per annum are about $240,000 per referred to as being an addition to the money annum. in circulation and evidencing a corresponding It would be of great value to any member inflation. The fact, however, is that for the or nonmember bank, whether small or large, most part gold has been drawn into the reserve if, as a means of gaining information concernof the Federal Reserve Bank pari passu with ing the methods of the Federal Reserve Bank, the issue of Federal Reserve notes. Everyone it would arrange to have a skilled employee of who uses a Federal Reserve note instead of the grade of assistant cashier or chief clerk gold really places the gold in the reserve of the enter for a few months the employ of the Fed- Federal Reserve Bank and thereby performs eral Reserve Bank. Positions are available a patriotic service in adding to the financial for a few such men either immediately or after fortification of the country. A study of the a little notice. A bank having on its staff weekly published statement of Federal Reserve one who had had such experience could not Bank will show not only the large issue of fail to derive important benefit through the Federal Reserve notes, but also the great knowledge gained of how best to avail of the increase thereby in the gold reserve. advantages of the Federal Reserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 FEDERAL BESEBVE BULLETIN, JANUABY 1,1918. DISCOUNT OPERATIONS OF THE FEDERAL RESERVE BANKS. During the month of November discount On the last Friday in November the Federal operations of the Federal Reserve Banks Reserve Banks held a total of $756,398,000 of totaled $3,206,486,771, or nearly 20 per cent discounted bills, as against $397,094,000 at the in excess of the previous record total for end of October. Paper directly traceable to October of the current year. Over 80 per war loan financing, i. e., member banks' colcent of the paper offered for rediscount was lateral notes and customers' paper secured by in the shape of member banks' collateral notes Liberty bonds and certificates, aggregated secured by Liberty bonds and certificates of nearly 500 millions and constituted about twoindebtedness, the New York bank alone re- thirds of the total discounts held by the banks porting $2,398,184,883 of this class of paper for about the close of the month, the remainder the month. Collateral notes, otherwise se- comprising $120,813,000 of member banks colcured, constituted about 13 per cent of the lateral notes, secured by commercial paper, total discounts for the month, while over 6 per $121,678,000 of customers' (secured and unse-, cent is represented by customers' paper, in- cured) paper, $8,731,000 of agricultural, and cluding paper secured by Government bonds $6,261,000 of live stock paper. About 72 per and certificates. cent of the agricultural paper was held by the Total discounts for the month include in Chicago and Minneapolis banks, while an equal addition $6,959,770 of trade acceptances both percentage of the live stock paper is credited to in the foreign and domestic trades, compared the Kansas City and Dallas banks. with $4,442,261 for October, and an average During the month the number of member of about $1,516,850 for the first ten months of banks increased from 7,783 to 7,846, largely as the present year; also $2,577,256 of commodity the result of admission to membership of State paper, compared with $1,659,491 for October banks and trust companies. The number of and an average of $867,927 for the ten months members accommodated during the month ending October of the present year. through the discount of paper is given as Discounts for the 11 months of the present 2,102, or nearly double the number shown for year aggregated $8,076,570,193, of which October. The total number of member $7,356,434,988, or over 90 per cent were collat- banks in each Federal Reserve district on eral notes, $22,128,269 trade acceptances, November 30, and the number of members $11,256,523 commodity paper, and $686,- discounting during the month of November, 750,413 customers' notes, including bills were as follows: secured by Government bonds and certificates. As compared with corresponding 1916 figures,j Number Number discounts of trade acceptances with the Reserve • Federal Reserve district. mem of ber a o c f c o b m a m nk o s banks increased nearly five-fold, while dis- banks. dated. counts of commodity paper declined about 30 Boston 401 229 per cent. New York 659 175 Philadelphia 634 116 Owing to the large preponderance of collat- Cleveland 762 102 Richmond . . . 529 102 eral notes, about 94 per cent of the total dis- Atlanta 388 133 counts of the month is reported as 15-day Chicago 1,082 843 St. Louis 476 78 paper (i. e., maturing within 15 days from date 779 108 Kansas City .. 960 115 of discount with the Federal Reserve Bank), Dallas 633 61 San Francisco 543 40 this proportion being as high as 99 per cent in Total 7,846 2,102 the case of the New York bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 53 Bills discounted during the month of November, 1917 and 1916, and the 11 months ending November, 1917 and 1916, distributed by classes. I Member banks' collateral notes, i Federal Reserve Bank. Li S b e e c r u ty re d b o b n y ds Otherwise acc T ep r t a a d n e ces. Co p m a m pe o r d . ity d A is ll c o o u th n e t r s , . Total. or U. S. certificates of secured. indebtedness. Boston $4,916,958 $15,535,000 S436,894 839,648,948 §60,537,800 New York , 2,398,184,883 213,905,000 1,102,357 50,475,052 2,663,667,292 Philadelphia 9,209,425 7,755,505 100,139 S29,000 14,384,533 31,478,602 Cleveland 13,074,250 14,362,000 819,959 131,360 19,195,135 £47,582,704 Richmond 15,280,366 35,195,902 544,291 134,125 5,124,606 i 56,279,290 Atlanta 5,289,550 12,298,500 1,350,141 1,354,252 2,756,926 £23,049,369 Chicago 78,537,698 45,798,250 12,788 38,550,614 162,899,350 St. Louis 12,971,600 10.9-48,000 651,754 310,689 7,431,652 32,313,695 Minneapolis 12,630,000 2)098,215 35,679 25,400 4,089,909 18,879,203 Kansas City 23,113,500 40,273,404 378,141 6,234,004 69,999,049 Dallas 5,384,000 5,281,281 37,528 23,921 2,108,966 12,835,696 San Francisco 7,059,500 9,004,800 1,490,099 568,509 8,841,813 26,964,721 Total, November, 1917 2,585,651,730 412,455,857 6,959,770 2,577,256 198,842,158 3,206,486,771 Total, November, 1916 5,587,895 853,300 1,047,000 10,415,905 £17,904,100 Total, January-November, 1917. 7,356,434,988 22,128,269 11,256,523 686,750,413 8,076,570,193 Total, January-November, 1916. 9,075,047 4.109,300 15,996,500 114,973,653 144,154,500 Amounts of discounted paper, including member banks' collateral notes, held by each Federal Reserve Bank on the last Friday in November, 1917, distributed by classes. [In thousands of dollars; i. e., 000 omitted.] Commercial and indus-1 Member banks' coltrial paper. | lateral notes. Banks. A p t g a u r p r ic e a u l r. l- Li p v a e- p s e to r. ck S ^ e L. s L c i ' u ib c b r e e e c r d rtt ? yy b * y! ! I ; Otherwise ! Se L * L c ° u ii f bb r * e ee < d rr tt * b yy y Otherwise d A is l c l o o u th n e ts r . Total. secured. tificates of ! tificates of indebted- j indebtedness. i ness. _L Boston 31,408 10,013 ! 2, 4,475 48,072 New York 36 34,467 20,887 i 345, 51,407 1,033 | 453,662 Philadelphia 84 •i 12,219 3,463 i 3,577 24,003 Cleveland 33 28 7,650 4,586 | 7,052 "7." 786" 32,612 Eichmond 544 1 1,544 4 770 I 2 5,593 1,820 16,735 Atlanta 400 217 10 4,860 I 2, 5,768 178 14,351 Chicago 5,025 157 5,275 33,92-i i 24, 18,716 88,029 St. Louis 97 115 172 9,010 ! 4, 3,670 172 17,838 Minneapolis 1,263 797 169 3,852 2,515 518 9,114 Kansas City 484 2,939 219 3,900 i 5,758 j 13,823 27,103 Dallas 296 1,544 1,811 ! 1550 | 1,078 6,279 San Francisco 483 463 175 i 9,519 ! 724 ! 5,136 100 i 18,600 Total 8,731 120,813 I 11,083 756,398 Per cent 1.2 16.0 1.5 100.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. Acceptances bought in open market and held by Federal Reserve Banks as per schedules on file with the Federal Reserve Board, or as reported by the Federal Reserve Banks on dates specified, distributed by classes of accepting institutions. Bankers' acceptances. Trade ac- Foreign Total ac- Date. M ba em nk b s e . r N co o m n t m r p u a e s n m t ie b s e . r N be o b r n a n m S k t e a s m . te - P b r a i n v k a s te . a b n r b d a a n a n c g k h e e n s - Total. b m ou o a g p r e h k n t e i t n . ceptances. 1915. Feb. 22.. 893,000 ! §93,000 $93,000 Apr. 5... 3,653,000 $7,820,000 ,$10,000 .§110,000 11,593,000 11,593,000 May 3.., 5,038,000 8,189,000 10,000 110,000 13,347,000 13,347,000 June 7... 5) 242,000 4,516,000 10,000 192,000 9,960,000 9,960,000 July3... 4,342,000 5,267,000 161,000 9,770,000 9,770,000 Aug. 2... 5,350,000 5,407,000 20,000 352,000 11,129,000 11,129,000 Sept. 6.. 6,087,000 6,305,000 20,000 472,000 12,884,000 12,884,000 Oct. 4... 9,000,000 4,898,000 132,000 343,000 14,373,000 14,373,000 Nov. 1... 8,477,000 4,331,000 253,000 204,000 13,265,000 13,265,000 Dec. 6... 12,311,000 5,172,000 275,000 396,000 18,154,000 18,154,000 i 1916. ! Jan. 3 15,494,000 7,160,000 362,000 822,000 23,838,000 23,838,000 Feb. 7 15,681,000 7,876,000 336,000 1,456,000 25,349,000 8489,000 25,838,000 Mar. 6 17,182,000 8,670,000 408,000 1,781,000 28,041,000 462,000 28,503,000 Apr. 3 1 21,000,000 13,573,000 473,000 3,262,000 38,308,000 722,000 39,030,000 Mayl ! 24,875,000 15,400,000 585,000 3,430,000 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 18,921,000 471,000 11,830,000 64,211,000 3,422,000 67,633,000 Aug. 7. . 39.,6 95.,000 19,060,000 738,000 13,940,000 73,433,000 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 1 37,770,000 29,474,000 1,014,000 12,147,000 80,405,000 2,378,000 82,783,0o0 Dec. 4 | 47,748,000 33,232,000 1,630,000 16,069,000 98,679,000 4,487,000 103,166,000 1917. j Jan. 1 ! 66,803,000 34,625,000 1,502,000 18,224,000 121,154,000 4,585,000 125,739,000 Feb. 5 ' 50,361,000 23,511,000 972,000 13,775,000 $140,000 88,759,000 4,041,000 92,800,000 Mar. 5 ; 53,288,000 32,518,000 1,090,000 20,581,000 354,000 107,837,000 2,535,000 110,366,000 Apr. 2 1 43,979,000 20,328,000 689,000 16,830,000 200,000 82,026,000 1,144,000 83,170,000 May 7 ! 49,192,000 19,650,000 236,000 19,177,000 94,000 88,349,000 1,679,000 90,028, GOO June 4 | 69,262,000 27,611,000 584,000 21,077,000 239,000 118,773,000 3,022,000 121,795,000 July 14-16 1 108,597,000 30,390,000 3,333,000 38,082,000 3,805,000 184,785,000 4,660,000 189,445,000 July 31 ! 112,433,000 43,107,000 2,564,000 20,782,000 1,087,000 179,973,000 4,242,000 184,215,000 Aug. 31 ! 94,597,000 33,273,000 2,312,000 18,086,000 1,369,000 149,637,000 4,952,000 154,589,000 Sept. 29 j 131,997,000 14,987,000 2,193,000 21,708,000 2,286,000 173,171,000 6,942,000 180,113,000 Oct. 31 1 150,301,000 3,147,000 1,307,000 21,083,000 2,153,000 177,991,000 6,224,000 184,216,000 Nov. 30 1 171,723,000 5.338,000 753,000 18,201,000 3,163,000 199,178,000 6,275,000 205,453,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL BESEBVE BULLETIN. 55 Amounts of bills discounted and acceptances and warrants bought by each Federal Reserve Bank during November, 1917, distributed by maturities. 15-day maturities. 30-day maturities. Banks. " ~ " | I Accept- Discounts. ances. Warrants. Total. Discounts.! Warrants. Total. Boston 814,243,721 490 ! ! $14,369,211 $9,918,861 8727,951 $10,646,812 New York 2,623,764,467 611,575 ! i 2,624,376,042 1,245,417 3,787,828 5,033.245 C Ph le i v la e d la e n lp d hia 2 1 8 7 , , 1 4 8 6 0 2 , , 6 0 2 7 2 2 3 5 9 8 7 2 , , 4 — 3 9 ; 2 1 8 7 , , 7 8 6 5 3 9 , , 0 5 0 1 3 1 5,1 7 7 0 4 8 , , 1 9 6 8 9 7 ! 2 3, , 7 6 6 6 4 6 , , 1 3 4 0 8 8 3 8 } ,9 3 3 7 8 5 , ! 3 2 1 9 7 5 Richmond 50,924,399 557, , ! 51,481,399 663,990 ! 3,108,928 3,772,918 Atlanta 18,868,473 1,509, , I 20,377,648 1,328,520 i 1,088,826 2,417,346 Chicago 127,880,288 , ! 127,880,288 5,105,413 5,105,413 St. Louis 25,530,285 25,530,285 I 1| 423', 566 j 1,165,039 I. 2,588,605 Minneapolis 14,904,674 302,502 j 15,207,176 I 520,369 ; 3,019,821 . 3,540,190 Kansas City 63,996,325 195,222 ! 64,191,547 i M9n6 0,0™06a !! 840,288 !. 1,800,294 Dallas 10,981,317 10,981,317 : 387,235 ' 2,908,200 !. 3,295,435 San Francisco 18,261,156 1,057,341 19,318,497 ; 2,073,355 ! 4,670,733 j. 6,744,088 Total. 3,014,997,799 5,338,125 ! j 3,020,335,924 i 29,509,888 ! 27,748,070 57,257,958 Percent 88.9 ! •| 60-day maturities. 90-day maturities. Banks. Discounts. Acceptances. Warrants. Total. Discounts. Acceptances. Warrants. Total, Boston $4,086,615 S3,604, 57,690,735 832,169,170 $7,184, 839,353,942 New York 6,708,561 16,355, 23,064,430 31,948,847 40,640, 72,589,452 Philadelphia. 1,575,537 7 458 §33,500 9,067,163 11,731,106 8,844, 20,575,808 Cleveland 6,346,481 9,619, 15,965,543 7,857,827 8,894, 16,752,424 Richmond... 1,526,664 3,640, 5,167,277 3,163,887 3,069, 6,233,139 Atlanta 1,886,530 821, 2,550 2,710,593 951,589 1,215, 2,174,181 Chicago 14,101,738 14,101,738 12,267,641 983, 13,250,906 St. Louis 3,090,450 "2*561" 5,591,505 2,239,404 3,873, 6,112,814 M. K M a iinn n nn s ee a aa s p p C ool i il t si y s* ! 1 A1 , ,, 7 6U G 8O 9 3O , ,, 5 8Q 1 5U 4 1A 3 2 , , 4 6 2 7 2 1 , , 4 5 , , 4 1 4 0 0 6 , , 8 0 4 8 1 5 2 1 , , 0 2 7 1 1 3 , , 5 6 4 2 4 9 3 1 , , 3 3 3 1 2 2 , , 3 4 , , 3 5 8 4 3 6 ^ ,2 9 7 7 1 4 Dallas I 790,518 5,796, 6,586,897 383,571 5,364, 5,748,005 San Francisco i 3,803,274 9,143, 12,946,323 2,655,771 7,540, 10,196,391 Total 47,369,733 65,033,347 36,050 112,439,130 108,653,986 1 92,255,832 200,917,307 Per cent 3.3 ! 5.9 Over 90-day maturities. Total. Per cent. Banks. Discounts. A a c ri c c e e p s t . - 1 j r W an a t r s - . Total. Discounts. A a c n c c e e p s t . - r W an ar t - s. Total. co D u is n - ts, A an cc c e e p s t . - I I r W an a t r s - . Total. Boston §119,433 $194,015'; 3313,448 $60,537,800 $11,836,348 $72,374,148 16.4 100.0 New York 2,663,667,292 61,395,877 I 2,725,063,169 97.7 ! 2.3 100.0 C P l h e i v la e d la e n l d phia 23,6 9 0 0 5 0 1 13 1 7 3 , , 4 0 8 5 8 1 ! ! ! 1 1 1 6 3 1, , 0 9 9 5 3 1 3 O4J7 1 L,, ,4 15U 7 8J,2 8 , , \ 6 7)\ 0 0J* 2 4 jX 1 V,2 9 2 , ', 4 I 9 7 I 9W 9 ,7 ,6 \,}£ 2 6J\7 6 J6 §33,500i 7 5 0 0 , , 5 9 8 9 0 1 , , 3 7 8 2 0 8 6 6 1 7 . . 7 4 I i 3 32 8 . . 6 2 0.1 1 1 0 0 0 0 . . 0 0 Richmond 350 90,146 9"0", 4'9"6" 56,279,290 i 10,465,939 I 66,745,229 84.3 ! 15.7 100.0 Atlanta 14,257 11,000 $120,534 145,791 2""3 ,049,369 ' 4,645,617 I 130,573! 27,825,559 82.8 i 16.7 .5 100.0 Chicago 3,544,270 62,849 i 3,,6 07,,119 ! 162', 899; 350 1,046,114 , i 163,945,464 99.4 i 100.0 St. Louis 29,990 238,333 i ! n2e6°8 ,o32o3o . 32,313,695 7,777,837 ! ' 40,091,532 80.6 i 19.4 i 100.0 Minneapolis 556,680 • ! 556,680 i 18,879,203 10,077,199 '; ! 28,991,536 65.2 I 34.8 ! 100.0 Kansas City ! 1,201^ 660 j j 1,201,660 :69,999,049 5,019,267 ! ' 75,018,316 93.3 i 6.7 ! 100.0 Dallas.....' I 293,055 : : 293,055 ! 12,835,696 14,069,013 i i 26,904,709 47.7 I 52.3 100.0 San Francisco I 171,165 ! i 171,165 ; 26', 964^721 22,411,743 •• j 49,376,464 54.6 : 45.4 100.0 Total I 5,955,385 846,882 ! 120,534 ! 6,922,781 3,206,486,771 191,222,256 164,0733,397,873,100 94.4 100.0 'or cent ! ! 100.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 FEDERAL RESERVE BULLETIN. JANUARY 1, 1918. Maturities of discounts, acceptances, and municipal warrants held by each Federal Reserve Bank on Friday, Nov. SO, 19.17, [In thousands of dollars; i. e., 000 omitted.] 1 to 15 days. 16 to 30 days. Banks. B co il u ls n t d e i d s . - Ac b c o e u p g ta h n t c . es M wa u r n r i a c n ip ts a . l Total. B co il u l n s t d e i d s- . Ac b c o e u p g ta h n t c . es M wa u r n r i a c n ip ts a . l Total. Boston 5,289 6,252 11,541 7,727 6,401 14,128 New York 406,683 3,141 505 410,329 6,434 3,139 9,573 Philadelphia... 9,449 5,089 14,538 523 5,768 6,291 Cleveland 17,075 7,370 3 24,448 2,964 5.902 2 8,868 Richmond 10,106 2,895 13,001 1,574 4,011 5,585 Atlanta 10,691 1,026 9 11,726 1,099 1,617 i3 2,729 Chicago 33,246 1.056 34,302 26,554 800 27,354 St. Louis... 10,688 1,472 12,160 2,390 2,067 4,457 Minneapolis 4,660 2,138 6,798 1,495 1,725 3,220 Kansas City.. 20,875 1, 722 22,597 1,138 866 2,004 Dp Has 3,658 2,013 5,671 938 2,695 3,633 San Francisco 10,460 4,192 14,652 2,156 2,347 4,503 Total 542,880 38,366 517 581,763 54,992 37,338 15 92,345 Percent 60.4 9.6 31 to 60 days. 61 to 90 days. Banks. B co il u l n s t d e i d s . - Ac b c o e u p g ta h n t c . es M wa u r n r i a c n ip ts a . l Total. c B o il u l n s t d e i d s . - Ac b c o e u p g ta h n t c . es M wa u r n r i a c n ip ts a . l Total. Boston 5,444 5,514 10,958 29,612 4,871 34,483 New York 11,473 20,612 32,085 29.072 29,298 sii 58,881 Philadelphia... 3,705 9,330 44 13,079 10,326 3,355 13,681 Cleveland 5,802 12,605 7 18,414 6,769 1,537 8,306 Richmond 2,503 4,592 7,095 2,537 1,842 4,379 Atlanta... . 1,696 1,322 3 3,021 820 924 141 1,885 Chicago .. 15,133 3,321 18,454 9,341 907 10,248 St Louis 3,362 2,744 6,106 1,351 1,977 3,328 Minneapolis... 1,414 3,617 25 5,056 904 107 1,011 Kansas City 2,863 1,414 4,277 1,194 7 1,201 Dallas.. 812 8.388 46 9,246 360 1,580 1.940 San Francisco 4,327 | 8,425 12,752 1,458 1,461 2,919 Total. 58,534 81.884 125 140,543 93,744 47,866 652 142,262 Per cent 14.6 14.8 Over 90 days. Total. Percentages. Banks. B co il u ls n t d e i d s- . b A a o c n u c c g e e p h s t t - . M w u ar n r i a c n ip t a s. l Total. B co il u ls n t d e i d s . - b A a o n c u c e g e p h s t t - . M w u ar n r i a c n ip t a s. l Total. co B d u i i n s l t l - e s d b A a o c n u c c g e e p h s t t - . M r w a p u n a a n t r l i s - c . i- Total. Boston 48,072 23,038 71.110 67.6 32.4 100. G New York. 453,662 56,190 1,016 510,868 88.8 11.0 6.2 100.0 Philadelphia .. ! 24,003 23,542 44 47.589 50.4 49.5 0.1 100.0 Cleveland 2 i 2 32,612 27,414 12 60. 038 54.3 45.7 100.0 Richmond. . 15 15 16,735 13,340 i 30,075 55.6 44.4 100.0 Atlanta 45 i20 165 14,351 4,889 286 i 19.526 73.5 25.0 1.5 100.0 Chicago ... 3, 755 3, 755 88.029 6,084 94,113 93.5 6.5 100.0 St Louis 47 47 17,838 8,260 I 2'6.098 68.4 31.6 100.0 Minneapolis .. 641 641 9.114 7,587 25 16.726 54.5 45.4 0.1 100.0 1,033 1,033 27,103 4,009 ! 31,112 87.1 12.9 100. C Dallas 511 511 6,279 14,676 46 21.001 29.9 69.9 6.2 100.0 San Francisco 199 199 18,600 16,425 35,025 53.1 46,9 100.0 Total 6,248 320 6.368 756,398 205,454 •1,429 963,281 78.5 21.3 0.2 100.0 Percent 0.6 100.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 57 Total investment operations, exclusive of purchases of United Stales certificates of indebtedness, of each Federal Reserve Bank during the months of November, 1917 and 1916, and the eleven months ending Nov. SO, 1917 and 1916. Bills bought in open market. Municipal warrants. Bills discounted for Federal reserve bants. m F. e m R. b e B r a s n a k n s d . ac B c a e n p k ta e n r c s e ' s. Trade Total. City. State. ot A h l e l r. Total. Boston.... j 860,537,800 §11,336,466 $11,836,348 New York ! 2,663,667,292 60,324,276 1,071,601 61,395,877 Philadelphia ! 31,478,602 18,786,857 692.769 19,479,626 $33,500 833,500 Cleveland i 47,582,704 22,913,336 84) 340 22,997,676 Richmond. - - ! 56,279,290 10,465,939 | 10,465,939 Atlanta 23,049,369 4,645,617 i , 4,,6 45,; 617 '"*"5,"550' '"i30,"573 Chicago i 162,899,350 1,046,114 : | 1,046,114 St. Louis '' 32,313,695 7,777,837 : | 7,777,837 Minneapolis 18,879,203 9,921 i 107,278 10,077,199 Kansas City 89,999,049 5!019,267 ' 5,019,267 Dallas I 12,835,696 14,069,013 : 14,069,013 San Francisco 26,964,721 20,521,156 i 1,890,587 22,411,743 Total, November, 1917 ; 3,206,486,771 186,875,799 ; 4,3-16,457 191,222,256 125,023 39,050 164,073 Total, November, 1916 ; 17,904,100 45,928,700 2,618,400 37,043,700 i 427,600 93,800 7,565,100 Total, 11 months ending November, i 48,547,100 1917 • 8,076,570,193 777,363,414 ! 27,323.138 15,645,355 I 260,115 i 720,548 16,626,018 Total, 11 months ending November, | 901,686,552 1916 1 144,154,500 304,916,700 | 14,407,800 82,277,200 4,084,500 j 920,300 87,282,000 319,223,500 United States bonds and Treasury notes. Total investment operations. Federal Reserve Banks. 2 per cent. 3 per cent. 1 i 1 3 »} p " er cent. 1 ' 4 per cent, i ' Tr 1 n e - o a y t s e e u a s. r r y I • i Total. Nov 1 e 9 m 17 b . e r, ! I No 1 v 9 e 1 m 6 b . er, No 1 b 9 v e 1 r e 7 , m . - N 1 o b 9 e v 1 r e 6 , m . - Per cU Per ct. Boston I j ! 872,374,148 S16,026,800 2.1 20.1 New York So, 350 S325,000 I '. S330,350 i 2,725,393,519 24,729,000 80.2 31.0 Philadelphia... 50,991,728 9,462,600 1.5 11.9 Cleveland 82,000 250,000 ! 504,000 I , 756,000 ! 71,336,380 5,421,700 2.1 6.8 Richmond 152,050 152,050 j 66,897,279 2,106,900 2.0 2.7 Atlanta 50 I 9,050 1 9,100 ! 27,834,659 3,389,800 0.8 4.3 Chicago 163,945,464 5,852,400 4.8 7.3 St. Louis 40,091,532 3,214,600 1.2 4.0 Minneapolis... 27,950 27,950 j 28,984,352 2,013,400 0.9 2.5 Kansas Citv... 75,018,316 1,026,800 2.2 1.3 Dallas ..... 26,904,709 2,197,900 0.8 2.8 San Francisco - 500 j. 500 I 49,376,964 4,202,700 1.4 5.3 Total, November, 1917 2,000 255,900 ! 1,018,050 1,275,950 i 3,399,149,050 100.0 Total, November, 1916 85,397,100 231,000 , | 200 Total, 11 months end- 5,628,300 ; | 79,644,600 j 100.0 ing November, 1917. 13,997,200 188,540 44,581,610 | 1,081,950 Total, 11 months end- 66,908,300 i 9,064,791,063 i ! \ ing November, 1916. 42,878,350 3,878,880 j 4,153,200 51,210,430 j 601,870,430 j \ United States securities held by each Federal Reserve Bank on Nov. SO, 1917, distributed by maturities. United States bonds with circulation privi- United States securities without circulation privilege. Feder B al a n R k e . serve 2 c o p n 1 e s 9 r 3 o 0 l c . s e o n f t 2 P o p a f 1 n e 9 r a 3 1 8 m 9 c . 3 e a 6 n s - t 3 l p o 1 e 9 a r 1 n 8 c . o e f nt o o ° 1 e ^ n 9 r 0 ^ r t , 5 c . n en ? t ! 3 c b o i P 9 o n 4 e v n r 6 _ e d c r s 4 e s n 7 i o t o , f n I ! ! 3 i ! P T e n 1 r r o - e c y t a e e e s n s a u t . r ry lo 3 1 c a 9 e p 6 n n 1 e o t . r f 34 L l o p i 1 b a e 9 n e r 4 r 7 o c t . y f ent L o 4 f i l c b o e p a e n 1 e n r 9 t r t 4 y 2. S t i i n f t U a i d n c t n e a e e b i t s s t e t s e e s c . d d e o r - f - Totai. Boston 8750 8529.000 82,194,000 i 880,000 8262,000 83,065,750 New York 50 $50,000 1,255,500 4,493,000 630,100 8347,950 4,655,000 11,431,600 Philadelphia 8100 I 549,200 2,548,000 1,100 205,000 3,303,400 Cleveland 6,400 467,200 2,653,666 $2,378,200 ! 414,800 3,221,000 2,026,100 348,300 3,414,500 14,930,160 Richmond 915,100 237,000 - —ooo 42,900 81,550 395,000 3,640,550 Atlanta 640,600 21,000 10,300 1,491,000 215,950 9,300 1,920,000 4,308,150 Chicago 1,862,500 367,300 2,581,000 1,768,000 427,400 3,368,000 8400 7,000,000 809,000 18,183,600 St. Louis 100 1,080,000 1,153,300 1,444,000 249,000 3,926,400 Minneapolis 323,050 16,260 1,199,180 "206," 250' 114,800 1,340,000 ""066" 27,950 473,500 3,701,490 Kansas City 7,155,850 22,240 825,000 838,500 1,784,000 7,500 438,000 11,071,090 Dallas 2,450,900 281,500 1,233,600 1,430,000 2,400 3,400 1,823,000 7,224,800 San Francisco 2,428,750 1,500,000 11,250 365,000 4,305,000 Total., 15,784,050 1,412,600 7,563,840 5,177,450 j 6,526,400 j 26,782,000 900 10,017,300 818,450 15,009,000 89,091,990 Total United States bonds with circulation privilege, 829,937,940. Total United States securities without circulation privilege, 859,154,050. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. RESOURCES AND LIABILITIES OF FEDERAL RESERVE BANKS- Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at close of business on Fridays, Nov. 80 to Dec. 21 1917. y RESOURCES. [In thousands of dollars; i. e.f 000 omitted.l New Phila- Cleve- Rich- At- Chi- St. Minne- San Boston. York. delphia. land. mond. lanta. cago. Louis. apolis. City. Dallas. F ci r s a c n o - . Total. Gold coin and certificates in vault: Nov.30 32,506 312,190 17,815 24,735 6,163 5,820 33,197 5,407 14,064 3,136 12,617 32,237 499,887 Dec. 7 30,228 317,141 17,461 24,685 6,250 5,725 32,526 5,446 14,400 1,587 12,687 32,520 500,656 Dee.14 , 26,345 322,880 16,740 24,446 6.165 5,603 32,602 5,464 14,751 1,789 12,781 33,274 502,840 Dec. 21 24,266 338,355 18,427 30,200 6,210 5,667 5,507 14,796 1,550 12,535 34,311 524,350 Gold settlement fund—Federal Reserve Board: Nov.30 825 40,660 23,091 60,833 42,495 11,238 65,198 22,975 21,043 43,658 27,974 35,246 Dec. 7..... 1,033 76,795 24,456 36,085 40,200 11,046 66,417 20,773 12,882 36,066 25,611 25,414 376,778 Dec. 14... 15,106 113,858 27,176 38,749 19,340 8,644 73,404 12,680 12,192 32,093 19,436 21,132 393,810 Dec. 21 4,101 23,002 24,867 50,950 18,526 13,470 68,314 10,842 10,329 37,349 22,590 20,264 304,604 Gold with foreign agencies: Nov.30 3,675 18,112 3,675 4,725 1,837 1,575 7,350 2,100 2,100 2,625 1,838 2,888 52,500 Dec. 7 3,675 18,112 3,675 4,725 1,837 1,575 7,350 2,100 2,100 2,625 1,838 2,888 52,500 Dec. 14 3,675 18,112 3,675 ! 4,725 1,837 1,575 7,350 2,100 2,100 2,625 1,838 2,888 52,500 Dec. 21 , 3,675 18,112 3,675 4,725 1,837 1,575 7,350 2,100 2,100 2,625 1,838 2,888 52,500 Gold with Federal Reserve Agents: i Nov.30 29,921 171,097 52,025 51,995 31,867 42,341 104,783 45,831 34,197 30,146 29,023 661,824 Dec.7 26,290 170,875 56,804 53,899 31,816 44,554 45,818 35,156 41,123 30,092 40,814 683,939 Dec. 14 , 31,657 167,489 57,060 53,816 31,695 49,391 112,074 40,403 30,981 42,091 25,075 41,646 683,378 Dec. 21 35,600 230,777 53,078 54,677 31,652 45,801 120,961 32,381 42,052 25,062 43,130 746,107 Gold redemption fund: Nov.30 1,000 5,000 1,500 13 574 618 480 750 719 514 1,054 12,278 Dec.7 1,000 10,000 1,500 91 551 676 535 745 732 513 1,083 59 17,485 Dec. 14 993 10,000 1,500 64 509 808 562 741 871 513 1,092 57 17,710 Dec. 21 1,000 10,000 1,500 18 846 585 873 509 1,205 17 17,982 Legal-tender notes, silver, etc.: Nov.30 5,623 42,931 940 641 165 849 1,521 60 641 243 54,486 Dec.7 4,797 42,154 793 564 161 588 1,013 549 54 665 303 51,949 Dec. 14 4,800 41,340 475 548 182 426 775 412 42 616 194 50,146 Dec. 21 4,492 40,184 371 205 155 454 456 390 51 566 394 48,127 Total reserves: Nov.30 73,550 589,990 99,046 142,942 83,101 62,441212,529 77,632 72,426 80,139 73,147109,2681,676,211 Dec.7 67,023 635,077 104,689120,049 80,815 64,164214,539 75,431 65,578 81,968 71,976 101,9981,683,307 Dec.14 82,576 673,679 106,626 122.348 59,728 66,447226,767 61,800 61,231 79,153 60,838 99,191 1,700,384 Dec. 21 73,134 660,430 101,918140,775 58,876 67,813230,192 52,172 59,424 84,136 63,796 101,0041,693,670 Bills discounted for Members and Federal Reserve Banks: Nov.30 48,072 24,003 32,612 16,735 14,351 17,838 9,114 27,103 6,279 18,600 756,398 Dec.7 83,383 350,518 23,886 33,905 18,475 15,275 81,976 20,152 8,538 25,384 20,472 686,902 Dec.14 80,426 342,950 28,191 44,746 22,631 14,791 78,176 30,291 12,036 29,138 9,390 20,665 713,431 Dec. 21 65,417 258,796 44,272 50,716 30,921 16,469 107,167 40,316 13,645 33,626 9,297 22,867 Bills bought in open market: Nov.30 23,038 56,190 23,542 27,414 13,340 4,889 6,084 8,260 7,587 4,009 14,676 16,425 205,454 Dec.7 10,093 61,658 22,467 23,153 13,397 7,203 5,331 7,700 6,748 3,146 15,887 13,899 190,682 Dec. 14 4,927 115,396 21,846 26,090 13,774 7,308 5,462 8,169 10,425 2,287 15,587 23,157 254,428 Dec. 21 4,741 138,654 21,059 27,205 13,723 7,296 9,027 7,581 9,405 1,730 15,860 21,662 277,943 United States Government longterm securities: Nov.30 609 2,287 550 1,277 14,007 2,233 1,888 8,849 3,972 2,440 47,304 Dec.7 610 2,159 1,049 8,295 1,299 2,097 14,007 2,233 1,888 8,849 4,272 2,440 49,198 Dec. 14 610 2,119 5,440 8,270 1,292 2,339 14,007 2,233 1,888 8,849 4,272 2,455 53,774 Dec. 21 610 2,095 6,894 8,268 1,221 7,007 2,233 1,888 8,849 4,021 2,455 50,438 United States Government short-term securities: Nov.30 2,456 9,148 2,753 6,636 2,364 3,411 4,177 1,693 1,814 2,222 3,253 1,865 41,792 Dec.7 2,456 14,196 4,464 7,014 3,169 3,391 3,603 1,444 1,414 3,534 3,475 2,264 50,424 Dec.14 2,194 20,510 4,706 3,049 2,922 3,428 1,444 1,341 1,784 2,070 1,910 48,046 Dec. 21 2,294 4,640 2,648 34,221 1,969 1,491 1,444 1,341 1,784 1,430 1,500 58,130 Municipal warrants: Nov.30 1,016 44 12 25 46 1,429 Dec.7 511 44 12 276 25 46 914 Dec. 14 511 44 359 25 46 994 Dec. 21 511 44 363 25 150 1,102 Due from other Federal Reserve Banks—net: Nov. 30 12,999 4,521 8,228 1,126 1,112 D D e ec c . . 1 7 4 5,192 1 1 1 , , 7 7 2 4 9 3 1 5 0 , , 7 28 0 6 9 2 6 , ,2 2 2 6 4 5 4 7 , , 9 5 6 5 9 1 1,237 1 6 3 , , 6 6 4 28 7 1 4 1 , , 0 1 8 0 6 4 9 4, , 2 4 6 2 7 1 "i,*5oi 7 1, , 9 6 1 4 2 0 1 1 3 2 1 6 , , 4 3 9 3 4 2 Dec. 21 4,909 2,302 1,827 4,664 7,206 12,175 7,100 2,247 18,139 141,375 Uncollected items: Nov.30 25,981 95,834 i 51,043 24,622 23,586 21,984 41,521 16,979 12,728 21,779 14,769 22,334 373,160 Dec.7 16,795 67,658 ! 34,069 17,829 21,555 25,265 43,705 18,670 12,724 22,726 15,719 13,857 310,572 Dec.14 24,233 78,997 I 39,772 19,216 15,442 23,880 39,836 18,545 10,832 25,302 12,762 10,839 319,656 Dec. 21 19,655 75,882 I 32,765 22,549 16,521 19,612 50,271 18,403 11,579 26,535 13,318 16,484 323)574 i Difference 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

JANUARY 1,1918. FEDERAL RESERVE BULLETIN. 59 Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at the close of "business on Fridays, Nov. 30 to Dec. 21, 1917—Continued. RESOURCES—Continued. [In thousands of dollars; i. e., 000 omitted.] Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e , - m R o ic n h d - . 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 i e s. - K C a i n t s y a . s Dallas. c F S i r s a a c n n o - . Total. 5'; per cent redemption fund against Federal Reserve Bank notes: Nov.30 400 137 537 Dec.7 400 137 537 Dec. 14 400 137 537 Dec. 21 400 137 537 All other resources: Nov.30 25 204 113 1,009 175 65 2,499 Dec.7 155 378 945 681 695 114 2,968 Dec. 14 35 396 34 639 551 1,155 2,810 Dec. 21 172 364 517 580 1,045 2,678 Total resources: Nov.30 173,706 1,208,127 |203,075 242,533 |14O,428 1110,149 379,459 130,165 106,490 152,729 117,580 172,109 3,104,784 Dec.7 180,360 1,131,777 ^202,411 a 2 r 1 xa 5 . ,9 t» 6 t»t 6 > | j 1 J- 4 ^t 1 v/ , , 1 i 3 *o 0 !• 1 »• 1 •» 2 •" 3 , , • 0 " 1 » 8 " 3 I 6 u. 3 i , t 1 »j 6 7 1 140,203 108,700 !l55,428 1117,145 162,684 3,001,836 Dec. 14 194,966 1,239,354 |206,336 235,671 :122,175 |125,996 3"6 8,947"1129,768 102,415 1151,180 107,758 160,129 3,125,554 Dec. 21 170,760 1,141,008 1211,902 285,570 !l28,067 1125,511 407,032 134,841 104,987 1159,307 ^109,054 184,1113,142,956 LIABILITIES. | Capital paid in: Nov.30 5,744 18,059 5,613 /, 500 3,613 2,723 8,646 3.441 2,589 3,379 2,791 I 4,036 68,500 Dec.7 18,143 5,850 7,929 3,650 2,735 8,681 3.442 2; 591 I 3,393 2,796 4,076 69,048 Dec. 14 5,804 18,173 5,850 8,019 3,653 2,819 3,443 2,605 '' 2,796 4,086 69,440 Dec. 21 5,804 18,207 5,889 ; 8,0193,664 2,811 9,032 3,474 2,615 3,396 2,795 i 4,146 69,852 Government deposits: Nov.30 11,720 10,209 22,282 14,289 4,680 39,300 12,635 11,681 11,834 13,438 42,928 Dec.7 9,415 21,057 5,514 23,102 13,462 12,685 17,074 13,597 8,689 13,778 21,747 Dec. 14 4,619 66,299 2,434 6,769 4,850 13,416 2,146 3,076 6,723 5,397 2,692 10,864 129,285 Dec. 21 23,760 8,440 60,465 10,219 8,043 28,549 8,307 8,501 12,631 5,330 39,487 221,761 Due to members—reserve account: Nov.30 67,347 746,163 72,562 46,532 34,472 160,477 46,789 40,404 68,876 45,492 1,489,370 Dec.7 76,614 656,353 78,297 104,682 43,926 34,953 165,873 50.231 41,026 73,123 44,938 67,158 1,437,174 Dec. 14 80,684 730,965 77,598 116,466 44,604 38,526 175,977 51,817 41,015 72,870 47,601 70,907 1,549,030 Dec. 21 70,272 77,062 99,007 41,834 37,069 162,297 49,463 39,77i! 69,208 45,058 64,747 1,389,434 Collection items: Nov.30 19,087 16,161 15,057 10,401 23,776 13,044 4,066 13,634 9,522 231,776 Dec.7 13,895 40,058 26,832 14,438 14,594 10,893 20,937 13,752 4,289 13,111 6,531 10,531 189,861 Dec. 14 17,818 43,281 33,038 15,522 11,789 8,223 22,333 13,276 4,168 10,109 6,519 10,691 196,767 Dec. 21 14,612 47,660 27,348 17,368 13,397 12,019 26,667 13,981 4,917 11,528 6,977 9,345 205,819 Due to other Federal Reserve Banks—net: Nov.30 7,726 1,240 20,609 7,364 1,918 17,091 Dec.7 9,875 28,479 609 1,184 Dec. 14 19,141 Dec. 21 13,865 4,215 "1*114 Other deposits, including foreign Government credits: Nov.30 11,309 102 4,697 190 3,055 19,473 Doc. 7 8,770 3,480 115 2,997 15,586 Dec. 14 7,971 227 2,711 221 3,041 14,282 Dec. 21 9,021 181 2,372 84 2,468 14,258 Federal Reserve notes in actual circulation: Nov.30 61,443 342,336 I 77,635 76,910 53,573 57,802 142,563 54,066 45,785 46,693 47,697 50,480 1,050,983 Dec.7 63,876 358,004 82,403 83,043 55,858 60,896 150,824 55,589 47,152 48,799 47,918 I 56,1751,110,537 Dec. 14 66,038 369,667 86,830 88,208 57,279 62,938 156,987 57,935 47,871 51,040 48,150 60,442 1,153,385 Dec. 21 70,976 381,544 58,953 65,486 173,806 59,532 49,161 54,119 47,780 I 63,4831,227.642 Federal Reserve Bank notes in circulation—net liability: Nov.30 8,000 8,000 Dec.7 8,000 8,000 Dec. 14 8,000 8,000 Dec. 21 8,000 8,000 All other liabilities: Nov.30 656 588 435 311 2,629 Dec.7 923 913 581 72 311 3,062 Dec. 14 862 2,998 460 361 5,365 Dec. 21 1,067 3,306 620 :. 631 94 397 75 6,190 Total liabilities: Nov.30 173,706 1,208,127 203,075 242,533 140,428 110,149 379,459 130,165 106,490 152,729 117,580 172,109 3,104,784 Dec.7 180,360 1,131,777 202,411 215,966 141,130 123,018 363,161 140,203 108,700 155,428 117,145 162,684 3,001,836 Dec. 14 194,966 1,239,354 i206,336 J235,671 122,175 125,996 368,947 129,768 102,415 151,180 107,758 160,129 3,125,554 Dec. 21 170,760 1,141,008 |211,902 285,570 128,067 125,511 407,032 134.841 104,987 159,307 109,054 1184, 1113,142,956 I 1 Difference between net amounts due to and net amounts due from other Federal Reserve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

60 FEDERAL RESERVE BULLETIN. JANUARY 1, 1918, FEDERAL RESERVE NOTES. Federal Reserve note account of each Federal Reserve Bank at close of business on Fridays, Nov. 30 to Dec. 21, 1917. [In thousands of dollars; i. e., 000 omitted.J Boston. New d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . la A n t t - a. 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 I from agent—net: Nov.30 63,641 376,917 81,355 80,495 • 55,485 59,157 147,358 58,828 ! 47,193 49,475 48,039 58,402 1,126,345 Dec.7 j 65,610 395,515 87,134 87,199 I 57,728 62,820 157,673 58,815 i 48,152 53,277 48,126 62,618 1,184,667 Dec. 14 j 67,877 411,329 93,390 91,116 ! 58,637 64,657 161,,2_5 9. 59,940 : 48,97755,398 48,677 67,750 1,229,007 Dec.21 .' 179,371 i 61,258 | 50,032 57,428 48,226 70,234 1,2 Federal Reserve notes held by \ ; bank: J ! ! j , -tE.Nov.30 2,198 34,581 3,720 ! 3,585 I 1,912 1,355 2,782 342 7,922 69,362 • Dec.7 1,734 37,511 4,731 i 4,156 1,870 | 1,924 . 64,,874995 i 4,762 ! 1,408 4,478 208 6,443 74,130 Dec.14 * """ 41,662 6,560 i 2,908 i 1,358 j 1,719 * 4,272' 3,226 : 1,000 4,358 527 7,308 75,622 ?*.: Dec.21 5,565 2,005 ! 1,106 3,309 446 6,391 67,427 Federal Reserve notes in actual 1,726 i 871 circulation: I Nov.30 ! 61,443 342, 77,635 ! 76,910 j 53,573 57,802 142,563 54,066 45,785 46,693 47,697 50,480 j 1,056,983 Dec. 7 03,870 358, 82,403 ;' 83,043 I 55,85800,896 150,824 55,589 47,152 48,799 47,918 56,175 1,110,537 Dec.14 66,038 86,830 ! 88,208 ! 57,27962,938 156,987 57,935 47,871 51,040 48,150 60,442 Dec.21 |. 173,806 59,532 49,161 54,119 47 780 63,843 I 1, Gold deposited with or to credit i ; :" : . of N F o e v d . e 3 r 0 a l Reserve Agent: ! 29,921 171, 52,025 i 51,995 31.867 ! 42,341104,783 45,831 34,197 30,146 29,023 38,598 : 661,824 I" Dec.7 26,290 170,875 566,,880044 !! 53,,88999 9j 3,18,81166 • 44i 106,698 45,818 35,156 41,123 30,092 40,814 683,939 " $T>ec.l4 31,657 167489 ! 57,060 I 53,816 i 31,69549*, 391 112,074 40,403 30,981 42,091 25,075 41,646 683,378 f%; Dec.21 35,600 230 770 ; 53,078 I 54,677 ! 31,65245,801 120,961 32,581 30,936 42,052 25,062 43,130 746,307 Paper delivered to Federal Re- ! serve Agent: Nov.30 33,758 207,362 ' 29,359 ! 29,558 : 30,14176,875 43,186 13,012 13,392 19,777 20,000 34,506 490,932 Dec.7 39,359 239,601 I 30,356 ! 33,348 , 32,07618,852 51,620 14,203 13,544 12,534 20,825 30,155 536,473 Dec.14 36,369 276,858 j 38,192 | 37,419 ! 36,49216,218 49,843 21,464 21,046 13,442 24,977 30,647 602,967 Dec.21 1 37,376 201,458 I 46,451 | 48,363 | 44,87321,753 59,114 38,792 21,425 16,398 25,157 40,914 602,074 Federal Reserve note account of each Federal Reserve Agent at close of business on Fridays, Nov. SO to Dec. 81,1917. [In thousands of dollars; i. e., 000 omitted.] San Boston. Y N o e r w k. d P e h lp i h la i - a. C la le n v d e . - m R o ic n h d - . la A n t t - a. Chicago. Lo S u t. i s. I i M ap i o n l n is e . - City. Dallas. Fran- Total. FEDERAL RESERVE NOTES. Received from Comptroller: Nov.30 91,480 605,480 111,480 102,880 73,300 80,340 191,720 69,700 i 61,480 70,740 67,540 64,200 1,590,340 Dec.7 95,120 623,680 113,980 103,680 74,820 I 86,020 202,280 70,820 I 61,480 72,740 67,540 68,440 1,640,600 Dec.14 646,680 117,420 112,720 74,820 87,020 209,260 70,820 63,480 74,740 67,540 73,640 1,693,320 Dec.21 97,680 659,880 124,600 117,720 78,100 222,220 72,580 ! 65,480 76,740 68,500 76,240 1,747,760 Returned to Comptroller: Nov. 30 17,259 115,143 16,045 8,445 14,815 10,243 6,062 7,962 9,197 11,365 11,851 5,798 234,185 Dec.7 17,810 115,365 16,906 8,541 14,972 10,330 6,147 7,975 9,238 11,563 11,964 5,822 Dec. 14 18,543 118,751 17,050 8,664 15,223 10,493 6,501 8,390 9,663 11,742 12,043 5,890 242,953 Dec.21 18,600 118,963 17,932 8,803 15,370 10,582 8,412 9,708 11,812 12,194 606 239,571 Chargeable to Federal Reserve Agent: Nov.30 74,221 490,337 95,435 94,435 70,097 185,658 61,738 52,283 59,375 55,689 58,402 1,356,155 Dec.7 77,310 508,315 97,074 95,139 59,848 75,690 196,133 62,845 52,242 61,177 55,576 I 62,618 1,403,967 Dec.14 77,137 527,929 100,370 104,056 59,597 76,527 202,759 53,817 62,998 55,497 i 67,750 1,450,867 Dec.21 79,080 I 540,917 106,668 108,917 62,730 77,438 215,631 64,168 55,772 64,928 56,306 II 75,634 1,508,189 In hands of Federal Reserve Agent: Nov.30 10,580 113,420 14,080 13,940 3,000 10,940 38,300 2,910 5,090 9,900 7,650 ! 229,810 Dec.7 11,700 112,800 9,940 7,940 2,120 12,870 38,460 4,030 4,090 7,900 7,450 i 219,300 Dec. 14 9,260 116,600 6,980 12,940 960 11,870 41,500 2,490 4,840 7,600 6,820 i 221,860 Dec.21 6,260 111,600 10,660 5,940 2,800 9,970 36,260 2,910 5,740 7,500 213,120 Issued to Federal Reserve 8,080 5,400 Bank, less amount returned to Federal Reserve Agent for redemption: Nov.30 63,641 376,917 81,355 80,495 55,485 ! 59,157 i 147,358 47,193 49,475 I 48,039 58,402 1,126,345 Dec.7 65,610 395,515 87,134 87,199 57,728 ! 62,820 ! 157,67358,815 48,152 53,277 i 48,126 62,618 1,184,667 Dec.14 67,877 411,329 93,390 91,116 58,637 ! 64,657 ! 161,25959,940 48,977 55,398 48,677 67,750 1,229,007 Dec.21 72,820 429,317 96,008 102,977 59,930 i 67,468 j 179,371 61,258 50,032 57,428 48.226 70 234 1,295,06 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDBKAL RESERVE BULLETIN. 61 Federal Reserve note account of each Federal Reserve Agent at close of business on Fridays, Nov, SO to Dec, 31,1917—Con. [In thousands of dollars; i. e., 000 omitted.] Boston. Y N o e r w k. d P el h p i h la i - a. C la le n v d e . - m R o ic n h d - . la A n t t - a. Chicago. Lo S u t. is. M ap i o n l n is e . - K C a i n t s y a . s Dallas. c F S i r s a a c n n o - . Total. FEDERAL RESERVE NOTES— continued. Collateral held as security for outstanding notes: Gold coin and certificates on hand—- ! Nov.30 24,410 162,820 4,220 18,237 1 3,603 2,513 13,102 !. ....! 14,080 242,985 Dec. 7 20,810 4,220 19,202 ! j 3,604 2,513 13,102 j. .... 14,080 240,351 Dec. 14 26,209 156,920 4,220 19,186 i I 3,603 2,513 13,102 I. ...J 14,080 239,833 Dec. 21 30,210 145,420 4,220 14,154 : 2,513 13,102 '. ....I 14,080 | 227,302 In gold redemption fund— Nov.30 3,511 8,277 4,001 3,758 367 3,068 152 I 2,013 1,595 j 1,786 2,717 33,714 Dec. 7 3,480 8,055 4,730 4,697 j 316 2,980 67 ! 2,500 1,554 ! 2,263 2.438 2,693 35,773 Dec. 14 3,448 10,569 4,586 4,630 ! 1,695 2,818 484 ! 2,485 1,379 , 2,231 2; 521 2,625 39,471 Dec. 21 10,537 5,029 5,523 1,652 2,728 396 j 2,463 1,334 j 2,192 3,709 41,281 Gold settlement fund, Federal Reserve Board— Nov.30 , 2,000 43,804 30,000 31,500 35,670 104,631 j 41,305 19,500 28,360 12,474 385,125 Dec. 7 2,000 47,854 30,000 31,500 37,970 106,631 I 40,805 20,500 38,860 13,574 38,121 407,815 Dec. 14 2,000 48,254 30,000 30,000 42,970 111,590 i 35,405 16,500 | 39,860 8,474 39,021 404,074 Dec. 21 2,000 75,000 43,829 35,000 30,000 39,470 120,565 27,405 16,500 39,860 8,474 39,421 477,524 Eligible paper, required minimum *— Nov.30 33,720 205,820 29,330 28,500 23,618 16,816 42,575 I 12,997 12,996 19,329 19,016 19,804 464,521 Dec. 7 39,320 224,610 30,330 33,300 25,912 18,266 50,975 I 12,997 12,996 12,154 18,034 21,804 500,728 Doc. 14 36,220 243,840 36,330 37,300 26,942 15,266 49,185 19,537 17,996 13,307 23,602 26,104 545,629 Dec. 21 37,220 198,540 42,930 48,300 28,278 21,667 58,410 28,877 19,096 15,376 23,164 27,104 548,962 Total— Nov.30 63,641 376,917 81,355 80,495 55,485 59,157 147,358 47,193 49,475 48,039 58,402 i1,126,345 Dec. 7 65,610 395,515 87,134 87,199 57,728 62,820 157,673 58,815 48,152 53,277 48,126 62,618 i1,184,667 Dec. 14 67,877 411,329 91,116 58,637 64,657 161,259 59,940 48,977 55,398 48,677 67,750 I1,229,007 Dec. 21 72,820 429,317 96,008 102,977i 59,930 179,371 81,258 50,032 57,428 70,234 i1,295,069 1 For actual amounts see item "Paper delivered to Federal Reserve Agent,"..on p. 60. Member Bank Condition Statement, Federal Reserve Banks at the close of business I Friday of each week, beginning December 7, Under date of November 19, 1917, the fol-! and that a summary be made by each Federal lowing letter was sent out to all Federal Re- Reserve Bank and telegraphed to the Federal serve Banks: Reserve Board not later "than the following Thursday, for publication when the Board's In view of the extensive fiscal operations \ weekly statement is issued on Saturday. which will be undertaken by the Government I As the leading State banks and trust comduring the period of the war, it seems most ! panies are now members of the system, it will desirable that those in charge of these opera- I be possible for the first time regularly to pubtions and the member banks themselves should i lish statistics which will include figures from be able to have a clear view at all times of the ; both the national banks and the State banking financial situation. To this end the Federal ! institutions. The necessary forms are trans- Reserve Board has decided that the member . mitted herewith and you are requested to inbanks in 82 of the most important cities should ' struct the member banks of those cities on the be requested to transmit once a week "to their I list which are in your district. If you desire to respective Federal Reserve Banks, a condensed ; have any additional cities in your district added statement showing the principal items, such as to the list, please notify the Board promptly. deposits, loans, investments, cash, Govern- Your usual cordial and effective cooperation ment obligations owned, and loans on such will be appreciated by the Board. securities. The preparation of these state- ; ments will involve but little labor and when I Three of the Federal Reserve Banks, in retabulated they will reflect quite accurately the | sponse to this letter, requested permission to changing conditions in money and credit. The ! add cities in their district to the list prepared information given will be most valuable to the business community and to the banks. It is I by the Board, and thair requests were granted intended that the figures be reported to the j This resulted in increasing the list to 96 cities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

62 FEDERAL RESERVE BULLETIN. JANUABY 1,1918. Almost all of the banks in these cities have RESERVE CITIES. OTHER LARGE CITIES, furnished the requested data and it is hoped Chicago, 111. Grand Rapids, Mich. that the few banks which have not as yet done Detroit, Mich. Peoria, 111. so will join the list of reporting banks in the Milwaukee, Wis. Joliet, 111. near future, thus making the weekly figures Indianapolis, Ind. Des Moines, Iowa. complete and comparable. Below is given a Sioux City, Iowa. list of the 96 cities selected, including, beside Cedar Rapids, Iowa. the 57 reserve cities, 39 other cities. Dubuque, Iowa. RESERVE CITIES. OTHER LARGE CITIES. St. Louis, Mo. Memphis, Tenn. Louisville, Ky. Evansviile, Ind. Boston, Mass. Hartford, Conn. Little Rock, Ark. Providence, R. I. I New Haven, Conn. Minneapolis, Minn. Duluth, Minn. Springfield, Mass. St. Paul, Minn. Kansas City, Mo. New York, N. Y. Buffalo, N. Y. Omaha, Nebr. Brooklyn, N. Y. Newark, N. J. Denver, Colo. Albany, N. Y. Rochester, N. Y. St. Joseph, Mo. Syracuse, N. Y. I Lincoln, Nebr. Jersey City, N. J. Kansas City, Kans. Bridgeport, Conn. Topeka, Kans. Philadelphia, Pa. Scran ton, Pa. Wichita, Kans. Camden, N. J. Pueblo, Colo. Wilmington, Del. Muskogee, Okla. Oklahoma City, Okla. Cleveland, Ohio. Toledo, Ohio. Tulsa, Okla. Pittsburgh, Pa. Erie, Pa. Cincinnati, Ohio. Canton, Ohio. Dallas, Tex. El Paso, Tex. Columbus, Ohio. Youngstown, Ohio. Houston, Tex. Shreveport, La. Dayton, Ohio. Fort Worth, Tex. San Antonio, Tex, Richmond, Va. Charleston, W. Va. Waco, Tex. Baltimore, Md. Huntington, W. Ya. Galveston, Tex. Washington, D. C. Norfolk, Va. Charleston, S. 0. Lynchburg, Va. San Francisco, Cal. Oakland, Cal. Roanbke, Va. Los Angeles, Cal. Charlotte, N. C. Portland, Oreg. Raleigh, N. C. Seattle, Wash. Wilmington, N. C. Spokane, Wash. Columbia, S. C. Tacoma, Wash. Salt Lake City, Utah. Atlanta, Ga. Jacksonville, Fla. Ogden, Utah. New Orleans, La. Knoxville, Tenn. Nashville, Tenn. Chattanooga, Tenn. Birmingham, Ala. Savannah, Ga. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDEKAL KESERVE BULLETIN. 63 Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities as at close of business on Fridays, Dec. 7 and 14, 1917. [In thousands of dollars; i. e.f 000 omitted.} 1. TOTAL FOR ALL REPORTING BANKS. Boston.Ncw York.! ; ; P P d h h e i i l l - a a . - C la le n v d e . - | i m E e ie n h d - . la A n t t - a. °- | Lo S u t. is. ! apolis. i ! ' K CC a ii n ty s . as Dallas. F c S i r s a a c n n o - . 1 j | Total. 1 | Number of banks reporting: Doc. 7 .*. 36 94 73 ! 67 28 I 79 ! 65 31 42 1 607 Dec. 14 36 94 ! 71 • 67 35 I 83 ! 64 36 42 | 620 U.!S. securities owned: ' Deo. 7 1555,258 31.179.896 1'346,861 18142.224 1839,581 : $29,774 i 591,076 [S40,415 $14,521 !S30,8321330.465••$62,242 81,763,125 $*" Dec. 14 i 51,522 1,009,659i 65,204 ! 163,995 I 39,115 j 35,825 | 76,479 : 35,833 I 11,485 I 28,378! 27.822 1,602,125 Loans secured by XJ. S. J i i ; bonds and certificates: I ; ! Dec. 7 j 41,753 230,028 I 22.936 j 17,743 i 9.280 2,072 I 28.916 ; 9.122 1,005 3,178 ! 2,087 5,° 87.! 373,517 Dec. 14 i 42,880 224,335 i 23,754 I 20,750 i 10,457 4,316 | 3«.;503 | 8;530 1,082 1,655 ! 2,613 5, 80 j 376,955 All other loans and investments: Dec. 7 654,724 4.168.. 407",540,629 795,861 1328.213 1186,979 !l,228,727 J354,960 216,889 428,064 176,431 1462,371 i 9,542,255 Dec. 14 ._.... 644.397 4,086,521 277 415 1318,225 J264;893 |1, 239,978 1356,824 214; 185 421,633 ; 179,608:466,364 i 9,618,320 Reserve with Federal Reserve banks: Dec. 7 54,741 626,724 i 54.533 i 883 | 28.800 16,015 i126.161 ! 35,249 18,094 42, 868 I17,969 41,728 ! 1,137,765 Dec. 14.. 55,086 714,222 120 ; 548 ! 29; 173 | 26,036 1j33,026 i 35,952 17,882 42,684 j19,143 46,380 j 1,266,239 Cash in vault: ! I Dec. 7 1 28,083 131, 7,06 ! 22.655 i 379.36 ! 19.292 I 10.676 I 58.570 ! 12,269 13,094 17,599 10,501 22,797 j 388,228 Dec. 14 •• 22,054 128,103 i 22,251 j 402,95 ; 17,531 | 14,119 : 59; 949 ! 13,243 10,226 18,116 12;i 461 23,008 381,356 Net demand deposits on j which reserve is com- : puted: : Doc. 7 532,269 4,107,195 |499,096 , 598.570 263.696 130.284 : 913.088 126-4.915 ;163,018381,060 166,873,370,903 8,390,965 Dec. 11 !550;236 4.178.671 |502,511 ! 656,399 1261.204 J203.983 ! 689,398 j267,693 164,266381,150 184,847;374,257 8,714,615 Time deposits: • Dec. 7 i 79.077 325,832 18,986 ! 179,254 1 54,678 ! 56,421 274.350 ; 86,600 ;; 37,100 41,157 19,300 ! 87,151 1.259.906 Dec. 14 1 77;229 307,234 18,633 I 204.678 i 46,143 j 64,408 280,140 ! 85; 222 ; 37,71648,183 20,437 ! 90,190 1,2S0',215 2. MEMBER BANKS IN CENTRAL RESERVE CITIES. CENTRAL RESERVE CITIES. Number of banks rcnorting: Dec. 7 " 51 ! ; 38 15 105 "Dee. I*... 54 i ; 36 15 105 U. S. securities ownod: ; Dec. 7 $1,120,417 . 1 ..: 833.124 $26.834 SI. 200.375 Dec. 14... i 955,471 ! • 41.791 22.425 1,019,687 Loans secured by U. S. i I | bonds and certificates: Dee. 7 201,829 i 1 18.881 7. 834 228,544 Dec. 14... 199,289 i 19.612 Q, 950 225'. 351 All other loans and invest- j j ments: Dec. 7 3. 750.170 ! i ! 1 813,388 252,325 4.815,883 Deo. 14 3-721,542 ! ! ! ! 811,728 255,919 ........ 4,789,219 Reserve with federal Re- i serve bank: Dec. 7 590.525 I .I ! I 91,110 28,117 712,752 3)eo.l4... 676,663 j ! '• 96.974 28,527 802,164 Cash in vault: Dec. 7... 116,015 1 . i j ! 39,^33 6.815 162,263 Doc. 14 110,685 j I j 39,070 7.459 157; 214 Net demand deposits on : ! j which reserve is computed: D De e c c . 7 14... 3 3, . 7 7 3 9 0 6 9 ,1 7 9 3 7 ; "• ; : 666918,.920758 1 18 8 8 7 . , 3 5 2 9 4 8 i 4 4 , , 5 6 8 8 0 2 , , 4 7 7 9 4 9 Time deposits: Dec. 7 287.854 • ! ; 12O.nSfl : 7fi.5«8 j 493,987 Dec. 14 | 269,947 , ! 130,125 ! 66,139 466,211 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

64 FEDERAL RESERVE BULLETIN. JANUARY 1,1918. Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities as at close of business on Fridays, Dec. 7 and 14, 1917—Continued. [In thousands of dollars; i. e., 000 omitted.] 3. MEMBER BANKS IN RESERVE CITIES. Boston.New York. P p d h h e i i l- l a a . - C la le n v d e . - m R o ic n h d - . la A n t t - a. Chicago. Lo S u t. is. M ap i o n l n is e . - ! K C a i n t s y a . s Dallas. F c S r is a a c n n o - . Total. OTHER RESERVE CITIES. Number of banks reporting: Dec. 7 14 16 40 357 Dec. 14 14 16 33 49 34 29 40 U. S. securities owned: Dec. 7 $41,894 $41,902 540,561 $126,265 825,169 jS23,761 $27,233 ! 87,039 $12,099 826,225 $59,853 $462,833 Dec. 14 38,063 37,892 58,788 151,311 25,430 I 29,234 24,113 i 6,613 9,386 28,378 24,152 54,710 488,070 Loans secured by United States bonds and certificates: Dec. 7 34,238 12,764 22,465 i 16,284 7,820 1,999 7,913 1,019 916 i 3,178 2,024 4,984 115,604 Dec. 14 35,592 15,592 23,270 ; 19,116 8,799 4,158 9,340 1,017 965 ! 1,655 2,553 4,651 126,708 All other loans and investments: ! Dec. 7 480,168 264,185 486,479 ! 683,441241,229 155,475 354,770 49,800 182,307 1428,064 146,528 448,253 3,920,699 Rese D rv ec e . w 14 ith Federal Re- 471,017 231,247 459,920 828,707 243,871 228,058 366,555 51,781 180,195 421,633 151,460 453,316 4,087,760 serve Bank: Dec. 7 43,999 25,318 50,876 i 67,955 23,067 13,780 I 28,795 3,878 15,972 42,868 15,510 40,773 372,791 Dec. 14 44,355 24,088 50,915 I 84,433 24,134 23,573 32,710 4,077 15,625 42,684 16,967 45,385 408,946 Cash in vault: Dec. 7 20,878 10,130 20,046 I 32,886 15,115 16,440 2,619 10,778 17,599 8,697 22,176 186,644 Dec. 14 15,164 10,011 19,908 I 35,175 13,763 12,219 | 18,395 2,769 8,413 18,116 10,690 22,321 186,944 Net demand deposits on which reserve is computed: Dec. 7 413,763 451.475 I 519,549 197,114 108,892 ! 223,113 37,762 138,074 1381.060 142,080 357,559 3,204,077 Dec. 14 433,611 235,528 453,906 i 594,631 199,905 178,365 | 256,712 40,182 139,340 1381,150 160,928 361,060 3,435,318 Time deposits: Dec. 7 29,271 22,315 13,893 : 152,274 41,115 44,966 116,234 8,947 25,593 I 41,157 13,180 86,617 595,562 Dec. 14 27,979 22,102 13,532 ; 182,100 33,882 52,078 121,470 8,832 25,607 | 48,183 16,122 641,548 4. REPORTING BANKS OUTSIDE RESERVE CITIES. COUNTRY BANKS. Number of banks reporting: Dec. 7 24 25 13 4 2 2 145 Dec. 14 22 24 25 13 4 7 2 147 U. S. securities owned: Dec. 7 813,364 317,577 $6,300 $15,959 $14,392 86,013 $10,719 $6,542 82,422 $4,240 $2,389 $99,917 Dec. 14 13,459 16,296 6,416 12,684 13,685 6,591 10,575 6,795 2,099 3,670 2,098 94,368 Loans secured by United States bonds and certificates: Dec.7 7,515 15,435 471 1,459 1,460 73 2,152 269 63 Dec.14 7,"~ 9,454 484 1,634 1,658 158 2,551 563 117 429 24,396 All other loans and investments: Dec. 7 174,556 154,052 I 54,150112,420 86,9S4 31,504 60,569 : 52,835 34,582 -I 29,903 i 14.118 805,673 Dec.14 173,380 133,732 39,357 97,708 74,354 61,695 ; 49,094 33,990 .j 28,148 j 13;048 741,341 Reserve with Federal Reserve i Bank: J Dec.7 1 10,742 10,881 ! 3,657 6,928 5,733 2,235 3,256 j 3,254 2,122 2,459 ! 955 52,222 Dec.14 10,731 13,478 4,205 7,115 j 5,039 2,463 3,342 , 3,348 2,257 2,176 ! 975 55,129 Cash in vault: Dec.7 7,205 8,611 : 2,609 5,050 4,177 1,396 2,697 i 2,835 ! 2,316 !. 1,804 : 621 39,321 Dec.14 6,890 7,407 ! 2,343 5,120 3,768 1,900 2,484 | 3,015 | 1,813 |. 1,771 j 687 37,198 Net demand deposits on which reserve is computed: Dec.7 ...118,506 142,588 ; 47,621 i 79,021 i 66,582 ! 21,392 28,070 • 39,555 24,942 24,793 i 13,344 606,414 Dec.14 116,625 146,946 ! 48,605 61,768 | 61,299 i 25,618 34,408 | 39,187 24,926 23,919 \ 13,197 Time deposits: Dec.7 49,806 15,663 5,093 26,980 i 13,563 : 11,455 28,581 10,055 ! 11,507 6,120 ! 534 170,357 Dec.14 49,250 15,185 5,101 j 22,578 i 12,261 ; 12,330 28,547 10,251 | 12,109 4,315 I 529 172,456 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUARY 1,1918. FEDERAL RESERVE BULLETIN". 65 EARNINGS ON INVESTMENTS OF FEDERAL RESERVE BANES. Average amounts of earning assets held by each Federal Reserve Banh during November, 1917, earnings from each class of earning assets, and annual rates of earnings on the basis of November, 1917, returns. i I Average balances for the month of the several classes of earning assets. Banks. United States ' Municipal securities. ] warrants. Total. F. R. Banks. ket. Boston $24,939,976 §26,354,677 $3,191,750 j $54,486,403 New York 309,990,240 48,661,057 33,075,779 j $1,016,525 392,743,601 Philadelphia.. 15,758,446 23,909,654 3,495,700 : 25,634 : 43,187,434 Cleveland 21,199,920 31,789,651 12,008,676 i 12,159 65,010,406 Richmond 13,050,494 10,667,544 3,619,084 : 27,337,122 Atlanta 12,594,541 4,476,948 8,510,148 : 197,813 25,779,450 Chicago 79,690,446 6,156,392 23,071,967 : 108,918,805 St. Louis 19,177,484 5,944,533 3,956,400 29,078,417 Minneapolis 12,697,200 8,740,600 3,&51,100 25,400 25,314,300 Kansas City... 32,981,954 4,861,153 11,063.890 48,906,997 Dallas 9,346,503 10,263,862 6,769', 067 46,265 '• 26,425,697 San Francisco. 16,927,037 13,809,363 5,326,983 36,063,383 Total., 508,352,241 j 195,635,434 117,940,544 1,323,796 j 883,252,015 Earnings from— Calculated annual rates of earnings from— Banks. a m B c B n o i e l u d a m ls n n F b t k . d e e R s d i r . s s . , - m i b n o B a u o r i k l p g l e e s h n t t . j I j i I U s S e t n t i c a e i u t t s r e e . i s d - M r w a u p n a n a t r i l s - c . i- Total. m a B c B n o e i d l u a m l n n s F b . t k d e e s R i d r . s s , . - m i b n o B a u o r i k l p g l e s e h n t t . U s S e t n t i c a e i u t t s e e r . i s d - M r w a u p n n a a t i l r c s - . i- Total. Per cent. Per cent. Per cent. Per cent.! Per cent. Boston I $75,287 879,043 | §5,876 $160,206 3.67 3.65 3.03 : 3.45 New York j 798,928 147,822 j 76,729 S3,030 1,026,509 3.03 3.57 2.48 3.50i 3.05 Philadelphia \ 47,258 65,373 | 8,696 85 121,412 3.64 3.32 3.02 4.05 ! 3.42 Cleveland i 67,361 88,620 I 29,307 44 185,332 3.87 3.39 2.97 4.44 I 3.47 Richmond | 40,897 30,454 i 8,191 79,542 3.81 3.47 2.75 i 3.54 Atlanta i 38,991 13,028 i 24,436 599 77,054 3.77 3.54 3.49 3.68 i 3.64 Chicago ! 236,986 17,393 i 60,401 314,780 3.36 3.54 3.82 i 3.46 St. Louis. ; 57,980 15,949 j 8,906 82,835 3.68 3.26 2.74 3.47 Minneapolis : 40,070 23,757 I 8,750 100 72,677 3.84 3.31 2.77 4.77, 3.49 Kansas City j 108,324 12,925 • 21,286 142,535 3.98 3.24 2.34 3.55 Dallas i 30,222 ; 30,539 ! 15,089 154 76,004 3.88 3.57 2.67 4.00 i 3.45 San Francisco ' 55,174 , 42,856 i 11,324 109,354 3.78 2.58 3.68 Total 1,597,478 j 567,759 \ 278,991 4,012 2,448,240 3.42 3.53 2.86 3.69 ! 3.37 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

66 FEDERAL RESERVE BULLETIN. JANUARY 1, 1918. GOLD IMPORTS AND EXPORTS. Gold imports and exports into and from the United States. Iln thousands of dollars; i. e., 000 omitted.] Week ending— Total cor- Total since respond- Nov. 23, Nov. 30, Dec. 7, Dec. 14, Jan. 1,1917.in d g u p r e in ri g od 1917. 1917. 1917. 1917. 1916. IMPORTS. Ore and base bullion ..... ... 355 295 397 196 15,231 12,509 United States mint or assav office bars 114 4,460 Bullion refined . . . 391 119 306 421 392,283 438,512 United States coin 9 125 80 1 53,907 3,122 Foreign coin 7 90,882 149,661 Total .' 755 539 790 618 552,417 608,264 EXPORTS. Domestic: 25 15 250 271 United States mint or assay office bars 46,594 16,768 Bullion refined 3,157 716 3 11 42,787 7,631 Coin 316 898 522 321 271,629 103,803 Total 3,473 1,639 540 332 361,260 128,473 Foreign: Bullion refined . . . . . 31 1,458 Coin 110 is 19 7,220 19,876 Total 110 15 19 7,251 21,334 Total exports 3,583 1,639 555 35l~ 368,511 149,807 Excess of gold imports over exports since Jan. 1,1917, 8183,906; excess of gold imports over exports since Aug. 1,1914, §1,052,668. DISCOUNT RATES. Discount rates of each Federal Reserve Bank approved by the Federal Reserve Board up to Dec. SI, 1917. Maturities. Discounts. Trade acceptances. Secured by U. S. certificates of indebtedness or Liberty Loan Federal Reserve Bank. Within 15 I Agricul- bonds. days, 1 tural and in m b c e a l m u n d k b i s e n ' r g 1 d 6 a t y o s . 60 6 d 1 a t y o s . 90 | | li o v p v e a e - p s r t e 9 o r 0 ck W da i y th s i , n i n 1 - 5 in I c d t l a o u y s 6 s i 0 v , e. in 6 c d 1 l a u t y s o s i v , 9 e 0 . co n l o la t t e e s r . al days. m c b l e u a m d n i k b n s e g ' r 1 d 6 a t y o s . 90 collateral notes. Boston 5 New York1 Philadelphia... 31 Cleveland Richmond Atlanta 44 ! Chicago 3! St. Louis Minneapolis... Kansas City... Dallas San Francisco. *Rate of 3 to 4£ per cent for 1-day discounts in connection with the loan operations of the Government. Note 1.—Rate for acceptances purchased in open market, 3 to 4£ per cent, except for Boston, Chicago, and Minneapolis, whose rates range from 3 to 5 per cent. Note 2.—In case the 60-day trade acceptance rate is higher than the 15-day discount rate trade acceptances maturing within 15 days will be taken at the lower rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

JANUABY 1,1918. FEDEBAL RESERVE BULLETIN. 67 FOREIGN EXCHANGE RATES. Monthly ranges of exchange rates on leading foreign money centers, quoted in New York City during the 6 months ending December, 1917. Iln continuation of figures published in the July, 1917, Bulletin.] July. August. September. October. November. December. Low. High. Low. High. Low. High. Low. High. Low. High. Low. High. i London: 80-day bankers* bills.. .dolls. for £1.. 4.715 4.7175! 4.715 4.7175 4.7125 4.7175 4.71125 4.7125 4.7125 4.7125 4.7125 4.7125 Sight drafts . do 4.75375 4.7565! 4.755K 4.7555 4.7530 4.7555 4.7515 4.7530 4.75125 4.7520 4.7515 4.7RQR Paris francs for 100 dolls 579.25 573 578.50 576.375 579.875 576.875 579.50 571 576.625 573.50 574 '573 Berlin dolls, for 400 marks Petrograd dolls, for 100 rubles.. 21.10 23.90 17.75 21.65 14.50 18 13.50 15.75 12 13.50 12.75 13.50 Vienna dolls, for 100 kronen.. Milan lire for 100 dolls 726 718 75i 723.50 78i 752.50 799 772 898 794 846 799 Amsterdam dolls, for 100 florins.. 41.125 41.4667 41.50 42.375 41.875 42.125 42.125 45.75 43 45.25 43.50 44.50 Stockholm dolls, for 100 kroner.. 30.30 33.10 32.75 33.85 33.45 34.40 34.90 42 36.34 45.50 33 37.25 Copenhagen dolls, for 100 kroner.. 28.95 29.50 29.75 30.40 30.20 31.15 31.125 35.75 32.50 38.75 31.50 33.75 Zurich francs for 100 dolls 480 452 437 438 481 450 471- 440 450 434 437.50 427 Buenos Aires, .dolls, for 100 paper pesos.. 43.19 43.97 42.91 43.25 42.76 43.23 42.85 44.21 44.66 47.01 45.59 47.65 Rio de Janeiro. dolls.f or 100 paper milreis.. 24.68 26.82 24.78 25.64 24.71 25.22 25.15 25.64 25.22 26.25 25.90 26.90 Valparaiso* dolls. for 100 pesos.. 24.35 24.60 24.65 24.78 26.78 30.02 26.78 29.93 25.28 28.63 28.03 28.27 Yokohama dolls, for 100 yen.. 51 51.25 50.875 51 50.90 51.375 50.50 52 51.25 52.125 50.65 51.80 Hongkong dolls, for $100 Mex.. 60.50 64.75 63.50 76.25 73 82 62.50 80 69.50 80 71 74.50 Shanghai....dolls, for 100 Shangh. taels.. 91.50 95.875 93.50 117 106 120 91.50 106 89 105 101 110 London prices of silver at nominal rate of $4.8665 per £ sterling. Month. Low. High. I Average. Month. Low. High. Average. I 1917. 1917. January 78.916 82.067 80.412 | August 87.959 100.837 94.409 February 81.793 84.260 82.721 September. 100.837 120.566 111.965 March 78.231 81.793 79.844 October 91.795 105.770 97.170 April 80.149 83.163 81.102 November.. 93.713 99.467 95.557 May 82.752 83.574 83.163 December.. 92.617 95.357 94.329 June 83.300 87.411 85.712 July 86.589 90.425 87.913 Year 1917 1 78.231 120.566 89.525 i Chilean rates on New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. Page. Acceptances: Federal Reserve note account of Federal Reserve Acceptance liabilities of American banking Banks and agents 60 institutions 11 Fiduciary powers: Banks granted authority to accept up to 100 List of banks granted, during month 15 per cent of capital and surplus 13 Opinion of Attorney General on power of Board Distribution of 54 to grant, in New York 12 Assets and liabilities of New York clearing-house Foreign exchange rates 67 banks 28 Foreign exchange regulations 11 Attorney General, opinion by, on power of Federal Gold imports and exports 66 Reserve Board to grant fiduciary powers to na- Gold settlement fund, transactions under 26 tional banks in New York 12 Informal rulings of the Board: Branch banks: Trade acceptances 30 Directors of, appointed 14 Eligibility of perishable food products 30 New branches and offices 10 Loans on city real estate 30 Business conditions throughout the Federal Reserve Warehouse receipts 31 districts 35-51 Revenue stamps on time drafts 31 Chart showing principal assets and liabilities of Election of branch directors 31 New York clearing-house banks 28 Kent, F. I., designated as foreign exchange adviser. 11 Charters issued to national banks during month 15 Law department: Commercial failures reported 16 Drafts drawn to finance sales to U. S. Govern- Commissioner of Internal Revenue, ruling of, re- ment 32 garding tax on parcel-post packages sent out by Sales corporations 33 Federal Reserve Banks 12 Farm loan bonds 33 Directors of Federal Reserve Banks, election of.. 5,13-14 Section 5200 34 Classes A and B 14 Liberty bond coupons, statement of Secretary of Class C 13 the Treasury regarding charges for cashing 13 Branch bank directors 14 Member banks, statement showing condition of, in Discount operations of Federal Reserve Banks 52-57 83 cities 61-64 Discount rates 7, 66 National banks: Dividends declared by Federal Reserve Banks 5 Charters granted to, during month 15 Earnings of Federal Reserve Banks 5 Fiduciary powers granted to 15 Surplus earnings turned into Treasury 6 Resources of, as shown by Comptroller's call... 17 Earnings on investments of Federal Reserve Banks Paper currency outstanding 18 during the month 65 Resources and liabilities of Federal Reserve Banks. 58 Expenses of the Federal Reserve Board, assessment Secretary of the Treasury, annual report of, extracts for 24 from 18-24 Federal Reserve Agents' fund, transactions under. . 27 State banks admitted to system during the month.. 16 Federal Reserve Banks: Tax on parcel-post packages, Federal Reserve Banks Earnings on investments of 65 subject to 12 Resources and liabilities of 58 Treasury certificates of indebtedness, issue of 4 Federal Reserve Board, assessment for expenses of. 24 United States bonds, amount held as security for Federal Reserve clearing system, operation of 27 circulating notes of national banks 15 o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis