Federal Reserve Bulletin, 1918-08

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

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

SUBSCRIPTION PRICE OF BULLETIN. The Federal Reserve Bulletin is distributed without charge to member banks of the system and to the officers and directors of Federal Reserve Banks. In sending the Bulletin to others the Board feels that a subscription should be required. It has accordingly fixed a subscription price of $2 per annum. Single copies will be sold at 20 cents. Foreign postage should be added when it will be required. Remittances should be made to the Federal Reserve Board. Member banks desiring to have the Bulletin supplied to their officers and directors may have it sent to not less than ten names at a subscription price of $1 per annum. No complete sets of the Bulletin for 1915 or 1916 are available. Bound copies of the Bulletin for 1917 may be had at $5 per copy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TABLE OF CONTENTS. 1'age. Curtailment of nonessential credits 685 Review of the month (igg Indexes 01 business conditions 097 Third issue of Treasury certificates (>99 Earnings and expenses of Federal Reserve Banks 700 Report of Capital Issues Committee 704 Council of State bankers' associations 708 Federal Trade Commission studies financing oi grain 711 Acceptances in cotton financing 71.3 Amendments to the Federal Reserve Act as passed by the Senate and House 714 Relation of farm credit to short-time bank credit for farmers 718 Text of amendment to Federal Reserve Act creating a foreign exchange bank 722 Testimony of Governor Harding before Committee on Banking and Currency regarding foreign exchange bank.. 724 Philippine National Bank Act 728 State banks and trust companies admitted to Federal Reserve system during July 734 Foreign branches of national banks authorized 735 Liberty bonds lost or stolen 740 Charters issued to national banks during the month 740 Commercial failures reported 741 Resolutions adopted by the Federal Reserve Bank of New York regarding conservation oi' credit 741 Fiduciary powers granted to national banks 742 Banks granted authority to accept up to 100 per cent of capital and surplus 742 I nfonnal rulings of the Federal Reserve Board 743 Law department 745 Business conditions throughout the Federal Reserve districts 747 Course of leading asset and liability items of the Federal Reserve Banks in 1918. 708 Charts showing 770 Gold settlement fund transactions 772 Operation or the check clearing and collection system 774 Discount operations of the Federal Reserve Banks 775 Resources and liabilities of the Federal Reserve Banks 782 Federal Reserve note accounts of Federal Reserve Banks and agents 785 Member bank condition statement 788 Earnings on investments of Federal Reserve Banks 793 Gold imports and exports 794 Discount rates in effect 794 Estimated stock of money in the United States 795 A Detract of condition of member banks on May 10, 1918 79(5 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN VOL. 4 AUGUST l, 1918. No. 8 CURTAILMENT OF NONESSENTIAL CREDITS. Governor Harding on July 8 transmitted to about the results desired. It would seem that all Federal Reserve Banks the following letter: those industries and enterprises obviously catering to extravagances and luxuries should DEAR SIR: There is being sent to your bank he considered first. Upon investigation it may under separate cover from the office of the develop that industries of this kind need not secretary of the Board, a supply of circulars to be closed down, nor their labor thrown out of be addressed to all the national banks, state employment, but that they can be gradually banks, and trust companies of your district diverted to essential lines of production and which are being asked to subscribe to Treasury distribution. The War Industries Board and certificates of indebtedness. the Capital Issues Committee are moving This communication from the Board to the successfully and energetically along these lines, banks draws their attention to the importance and with the better knowledge of the general at the present time of a judicious curtailment principles involved it ought not to be difficult of credit granted for so-called nonossential now to secure the effective cooperation of transactions; and it urges the banks to do their banks throughout the country in dealing with utmost in cooperating in a policy looking to the individual credits. gradual but general curtailment of such credits. It may be well to point out that in the inter- As you may recall, the Board printed in the est of successful Government financing, it FEDERAL RESERVE BULLETIN for April last a statement defining its views on this subject. would be much better to hold credit within This statement has no doubt had some educa- reasonable bounds by intelligent cooperation, tional value, but it is evident that effective rather than to attempt to force contraction by steps in the direction of curtailing unnecessary establishing high discount rates. credits have been taken by only a compara- The general letter referred to by Governor tively small number of banks. The situation Harding was as follows: as regards credits, however, is now better under- DEAR SIR: In the BULLETIN for April, 1918, stood, and it is believed that if the Federal the Federal Reserve Board published a state- Reserve Banks will follow up the Board's ment setting forth the reasons why, in its opinappeal with energy and tact, good results may ion, a gradual but consistent curtailment of be achieved at this time. nonessential credits is necessary, and urging The recommendations made in the April the banks and trust companies of the country statement are renewed, and it is suggested that to do whatever they could in the exercise of a the Federal Reserve Banks organize, each in its reasonable discretion to restrict credits which own district, local groups comprising the lead- are clearly not needed for the prosecution of ing bankers and business men, and discuss the war or for the health and necessary comfort with them the ways and means of bringing of the people. 685 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

686 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. On June 12 the Secretary of the Treasury ad- greater service to the country in this connecdressed a letter to all banks and trust companies tion, not merely by subscribing their allotments announcing his financial program for the ensu- and by using the rediscounting facilities of the ing six months, which involves the sale to and Federal Reserve Banks in making payments, through banks of approximately $6,000,000,000 but by providing the necessary funds for meetof Treasuiy certificates of indebtedness in in- ing payments for certificates of indebtedness stallments of not less than $750,000,000 every purchased, by employing for this purpose the two weeks between June 25 and the 1st of accretion of new deposits, and by utilizing the November. In this letter each bank and trust funds that may be made available by a judicompany was requested to invest in these cer- cious curtailment of credits asked for nonessentificates an amount equal to approximately 2£ tial purposes. per cent of its gross resources, or a total of 5 In order to prosecute the war successfully per cent for each month. Announcement was the Government is compelled to issue obligamade at the same time that there was in con- tions to provide for its large expenditures, which templation an issue of $2,000,000,000 of cer- involve waste and destruction rather than a tificates of appropriate maturities in anticipa- permanent addition to the national wealth. tion of income and excess-profits taxes, for sale This process in itself tends to inflation, and more particularly to taxpayers, and that the contributes to a rapid increase in the price of amount of the regular semimonthly sales of necessities. Abnormal demands by the Govcertificates of indebtedness would bo reduced ernment, unavoidable and necessary in the in proportion to the extent to which these tax present circumstances, must be counteracted certificates are taken by the public. by greater economy on the part of the civilian The banking institutions have responded population, which must decrease, by combined most generously to the appeal of the Secretary effort, the normal waste incident to domestic of the Treasury. Throughout the country they life and business pursuits. There is not an have pledged themselves without hesitation to unlimited supply of credit, or of goods, or of subscribe to their allotment, and the result of man power. Wherever possible all such rethe initial offering, which has just been closed— sources should be conserved and set aside for a subscription of $838,000,000 in response to a the use of the Government. Credit extended request for not less than $750,000,000—is evi- for nonessential purposes involves the use of dence of the splendid patriotism of those who labor, of transportation, of material, and redirect our national and State banking institu- serves which ought to be kept free for the use tions. The Board hopes that succeeding issues of the Government. Unrestricted credit inwill be subscribed as readily and in the same volves unnecessary competition with the Govpatriotic spirit. ernment and needlessly advances prices, besides The Federal Reserve Banks will be prepared impeding and delaying Governmental operato place their facilities—directly or indirectly— tions. at the disposal of such subscribing banks as may "Business as usual" and "life as usual" are legitimately need assistance in taking their impossible at a time when the supreme business allotments. The Board, however, feels in duty of the country is war, and can not be approxibound to reiterate that the banks can render a mated without interfering with the work of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL EESEBVB BULLETIN. 687 the Government and inflicting serious harm national resources during the period of the war, upon the Nation as a whole. The staying power in aiding its successful prosecution, and in of the country in this emergency depends upon maintaining the economic strength of the the extent of its resources in men, goods, and country for the time of rapidly changing congold. An unnecessary use of credit, a needless ditions which will come when the war has been recourse to the discounting facilities of the won and the millions of men in our armies are Federal Reserve Banks, weakens proportion- returning to the employments of peace. ately the gold reserve of the United States— Thus, by giving your cooperation now in the the financial backbone of the entire allied effort to conserve national resources by the group. Whoever wastes the raw material exercise of discriminating judgment in granting and manufactured products of the country credits, you will also do your part in averting adds to our financial burden by increasing the the danger of unemployment which is apt to amount the United States must impart from follow a treaty of peace. The Board appreother countries and by decreasing, at the same ciates the difficulty of laying down a general time, the volume of goods that should be avail- rule for defining essentials or the degree in able for export purposes—the best means of which any enterprise is essential, and requests paying for the goods acquired from abroad. that its remarks on this subject in the April Conservation of our commodities and of our issue of the BULLETIN be read again. The gold—preservation of our economic strength— Board can not suggest specific ways in which is of the greatest importance in making provi- credit should be conserved or unnecessary exsion for the period of readjustment which will pefiditures curtailed, as each banker must follow the reestablishment of peace. The determine this for himself after conferring with country having the largest supply of goods and the business men of his community and after gold available at the end of the war will find a careful study of his local situation. Reasonitself in the best strategic position for con- able discretion should be exercised, and trolling the markets of the world. The Board drastic steps calculated to bring about hardwishes to point out also that by refraining ships or embarrassments or work injustice from buying luxuries and by restricting the should be avoided, but the banks should divert the use of their credit more and more use of necessities to the actual requirements of into productive fields, where its employment health and reasonable comfort we can create will result in augmenting the national rea reserve purchasing power which will be of sources. the greatest value to our industries in bridging over the period of reaction and reconstruction Respectfully, yours, which must follow when war enterprises are W. P. G. HARDING, transformed into those of peace. An intelli- Governor. gent and prudent use of credit, therefore, will To the President of the Bank or Trust be an important factor in strengthening the Company addressed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

688 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. REVIEW OF THE MONTH. The number of subscribing banks in the second issue has again increased from 13,309 The second offering of $750,000,000 of Treasto 14,779, but the number of banks refraining ury certificates of indebtedness, Government from doing their duty in this respect is still dated July 9, subscriptions financing. unduly large, and the Board sincerely hopes for which closed on July 16, that the list of "slackers" will continue to dewas oversubscribed to the extent of about crease rapidly. $10,000,000. In the FEDERAL RESERVE BUL- In order that the initial success of the plan LETIN for July attention was called to the sucof financing may be continued cess of the first issue. The second issue has Conservation of to the end, it will be necessary been widely and successfully absorbed. resources. that the utmost care be taken The allotments made for the second issue with a view to the conservation of the financial show that the Federal Reserve districts of New and credit resources of the country. Much has York, Philadelphia, St. Louis, and Kansas been said during the past year of the necessity City exceeded their dividend quota, the comfor a conservative and cautious loan policy on plete list of subscriptions being as follows: the part of the banks. The time has come when the application of such a policy in prac- Federal Reserve Bank. Quota. Allotment. tice has become imperative. With a view to United States Treasury $41,163,000 impressing the necessity of such action upon Boston $65,000,000 5-S, 273,500 New York 254,000,000 273,219,510 the managers of the various institutions of the Philadelphia 53,000,000 53,100.000 Cleveland 68,000,000 66,550;000 country, the Federal Reserve Board on July 6 Richmond 2f>,000,000 15,073,500 Atlanta 22,000,000 16,021,500 sent to each Federal Reserve Bank for distribu- Chicago 105,000,000 101,203,000 St Louis ! 30,000,000 31,200,500 tion to all institutions within its district a Minneapolis I 26,000,000 22,100,000 Kansas City 30,000,000 30,031,500 general letter relating to the curtailment of S D a a n ll a F s r ancis 1 c o I 1 5 1 3 8 , , 0 0 0 0 0 0 , , 0 0 0 0 0 0 3 1 9 4 , , 0 4 0 5 0 2, , 0 0 0 0 0 0 unessential credit. This letter is reproduced Total 750,000,000 759,438,000 in the present issue of the BULLETIN. In the letter the Board called especial attention to the In consequence of the oversubscription of fact that it would be necessary to distinguish the first two issues of Treasury certificates in clearly between loans for the support of essenanticipation of the fourth Liberty loan and the tial businesses and those which are clearly not increased returns from war savings certificates needed for the prosecution of the war or for the and from income and excess profit taxes, the health and necessary comfort of the people. Secretary of the Treasury found it possible to With this end in view it urged " a gradual and reduce the minimum amount of the third bi- consistent curtailment of nonossential credit,'' weekly offering of Treasury certificates to and the use of self-restraint by consumers in $500,000,000, as follows: the use of their purchasing power, saying: "Conservation of our commodities and of Federal 'Reserve Bank. Quota. ! Subscription. our gold—preservation of our economic strength—is of the greatest importance in U Bo n s i t t o ed n States Treasury.. 843,300,000 4 $ 8 4 , , 2 3 0 2 7 7 , , 5 0 0 0 0 0 making provision for the period of readjust- N Ph e i w la d Y e o lp rk hia 1 3 6 5 9 , , 3 6 0 0 0 0 , , 0 0 0 0 0 0 2 3 1 6 1 , , 8 7 7 1 2 4 , , 5 0 0 0 0 0 ment which will follow the reestablishment of C R l i e c v h e m la o n n d d 4 1 5 7 , , 3 3 0 0 0 0 , , 0 0 0 0 0 0 5 1 5 6 , , 9 8 2 8 7 6 , , 0 0 0 0 0 0 peace. The country having the largest supply C A h tl ic a a n g ta o 7 1 0 4 , , 0 6 0 0 0 0 , , 0 0 0 0 0 0 8 1 3 3 , , 3 1 1 6 0 8 ! ,5 50 0 0 0 of goods and gold available at the end of the M St i . n L n o ea u p is olis 2 1 0 7 , , 0 3 0 0 0 0 , , 0 0 0 0 0 0 2 1 5 6 , , 9 8 5 0 2 0 , , 5 0 0 0 0 0 war will find itself in the best strategic position D K a a l n la sa s s Cit 1 y 2 1 0 2 , , 0 0 0 0 0 0 , , 0 0 0 0 0 0 2 1 3 0 , , 3 1 6 5 9 6 , , 0 0 0 0 0 0 for controlling the markets of the world. The San Francisco 35,300,000 38,000,000 Board wishes to point out, also, that by refrain- Total.. 500,000,000 584,750,500 ing from buying luxuries, and by restricting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 689 the use of necessities to the actual requirements standpoints, taking into account also the of health and reasonable comfort, we can create question how far labor now employed in exista reserve purchasing power which will be of the ing industries can be advantageously diverted greatest value to our industries in bridging- without hardship to those whose products are over the period of reaction and reconstruction necessary for the successful conduct of the war. which must follow when war enterprises are Consumers can assist in this process of credit transformed into those of peace. An intelli- curtailment and shifting by exercising a gent and prudent use of credit, therefore, will greater degree of economy and self-control in be an important factor in strengthening the their purchases and by confining themselves national resources during the period of the war, to those objects of expenditure which involve in aiding its successful prosecution, and in the use of their funds for purposes necessary maintaining the economic strength of the to the maintenance of the efficiency and comcountry for the time of rapidly changing condi- fort of the individual, abandoning those which tions which will come when the war has been are unnecessary and which can safely and won and the millions of men in our armies are wisely be deferred to the future. The problem returning to the employments of peace.'7 can be effectually solved only by the general Many inquiries have been received by the and well considered cooperation of all elements Board with respect to the defi- in the community. There is printed elsewhere (( "Essential"and nition of the terms "essential" in the present issue a resolution on this subnonessentiai. , . ject adopted by the Federal Reserve Bank of and " nonessentiai. Such in- New York. quiries can be specifically answered in but few This whole question was carefully discussed cases. The question must be determined in with governors and representaeach case by local bankers after conferring with the business men of their communities tives of Federal Reserve Banks and after a careful study of existing conditions. at a conference held in Wash- "Reasonable discretion should be exercised and ington July 1 and 2 and has since been the subdrastic steps calculated to bring about hard- ject of further study and investigation. It ship or embarrassment or to work injustice was the opinion of the governors of the banks should be avoided. The banks should en- that the time had come for concerted action deavor to divert the use of their credit more in the direction of conservation of credit. and more into productive fields where its em- General conditions throughout the country ployment will result in augmenting the na- were reported as extremely satisfactory, the crop tional resources. The work of the Capital prospect being excellent, wages high, and Issues Committee during the past few months banking conditions good. It was not, therehas furnished general principles governing the fore, with a view to meeting any danger in the application of the idea of conservation in existing situation, but rather for the purpose the investment field, and the extension of of conserving our economic strength and prothese principles to banking credit will be a moting the general financial preparedness of matter of local judgment and discrimination. the country that the Board's letter was issued. Some light upon the matter will be obtained Rates of interest at Federal Reserve Banks are from the action of the various boards and very moderate, and the banks are prepared to bureaus of the Government in regulating the place their facilities, directly or indirectly, at importation and distribution of material and Ithe disposal of all subscribing institutions that commodities and in controlling the division of may legitimately need assistance in taking the available supply between consumers. In |their allotments of Treasury certificates. Comeach locality it will be necessary to make a mercial rates of interest, although higher than careful study of the situation from all these in the past, are not abnormal, and it was the 72715—18 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

690 FEDERAL RESERVE BULLETIN. AUGUST l, 1918. general opinion both of the governors and of bona fide acceptances growing out of actual the Board that no marked advance in redis- commercial transactions is to be urged, therecount rates was called for at this time. While fore, more strongly than ever. In this connecsuch an advance would be warranted in view tion a letter recently written by the Board to of the growth of the necessary demands of one of the Federal Reserve Banks calls attention Government financing, as already set forth, it to the desirability of developing acceptance was believed that the conservation of credit practice in the United States along certain lines would, for the present at least, be more effec- well recognized in Great Britain. English practively and thoroughly secured by the adoption tice favors the free indorsement of acceptances, of a general plan of cooperation rather than by and some progress in this direction is already the application of uniform advances in rates of being made in the United States, as shown by interest. The results which have been realized the fact that in New York, out of about $120,in the conservation of food through voluntary 000,000 of acceptances reported by the New public action rather than through the adop- York Federal Reserve Bank in its last statetion of any strict plan of rationing furnishes a ment, only some $3,000,000 were unindorsed. precedent for the successful adoption of a simi- In order to further the easy financing both lar plan in the economy and conservation of of the Government and of banking credit. It appeared that in some dis- Interest rates. essential industries, and in order tricts the large production of agricultural sta- to avoid the necessity of advancing rates of ples and of necessary manufactured goods interest for financing them, it is requisite that would make, during the coming months, a every effort be made to check tendencies severe draft upon the credit resources of those toward an upward movement in interest rates. districts, and while other Federal Reserve One important factor in this situation will Banks, as usual, stand ready to assist in these be the avoidance of increase in the interest necessary protective operations through the allowed on deposits—both those of individuals machinery of interbank rediscounts, it was with banks and those of banks with other recognized that in every district the attempt banks. The Board has for some time past should be made so far as possible to meet nec- endeavored to obtain a general agreement essary loan requirements through the curtail- among the banks of the financial centers which ment of those which are less essential or can be would check the practice of competing for entirely dispensed with. deposits by raising rates thereon. During the The usual seasonal demands for accommo- past month the banks of Chicago have adopted dation in the agricultural dis- the same scale of payment for bank deposits cta of the West' combined which had been previously accepted in New with the continuous require- York, as announced in the FEDERAL RESERVE ments of Government financing, have necessi- BULLETIN of April. In order to equalize tated further use of inter-reserve bank redis- conditions, the Federal Reserve Bank of counts during the month of July. In a few Chicago placed its 90-day rate upon the cases reserves have thereby been equalized, same footing as that of the New York bank, partly through the transfer of the proceeds while the local member banks undertook to of indorsed acceptances from one Federal regulate their rates to depositors upon a scale Reserve Bank to another. The situation fixed with reference to this rate charged by the emphasizes the desirability of the posses- Federal Reserve Bank—the policy previously sion of substantial quantities of the most agreed upon in New York. Negotiations lookliquid commercial paper, and of the adoption ing to the same end have been in progress at of every means for the promotion of liquidity other points. The adoption of the plan should and availability of resources. The extension be made as general as possible in order that of the practice of making and investing in such relations between the banks and their Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 691 customers may be^standardized. There should demand. The English have had this systemabe no effort on the part of any one place or tized for many years. Drafts are drawn at 60 days', 3 months', or 4 months' time and are section of the country to bring about artificial accepted by a prime banker. If a southern diversion of funds from any other. Intelligent bank wishes to buy the drafts, it can do so; but, cooperation in this matter is a dictate of self- as a rule, they are sold through exchange protection for the banks, and at the same time brokers in New York, a draft with invoice and a duty toward the country. a bill of lading attached being drawn against them, upon payment of which the foreign bills Conferences of bankers, cotton spinners, and are delivered. I see no reason why brokers cotton growers were held in selling commercial paper and foreign bills can Cotton financ-New Orleans on July 5 and in not also sell domestic bankers' acceptances, so ing. Washington on July 15 and 16, that if a southern bank which wishes cash has and various representatives of the several inter- a 90-day draft against a lot of cotton accepted by a bank in the East it can arrange with the ests affected consulted informally with the Fedbroker to buy that draft and draw on the eral Reserve Board. The subjects discussed broker with the documents attached, the same related chiefly to the financing of cotton for the as is done with the foreign draft. season of 1918 and to measures of a like kind In consequence of difficult conditions in to be applied to the crop of 1919. In the BUL- Montana and parts of North LETIN for July reference was made to the plan finance Dakota, Kansas, and Texas, to apply the acceptance system in the financwhich have been creating a ing of the cotton crop, and portions of an serious situation for farmers there, involving address made by Governor Harding before a probable abandonment of farms and sacrifice of conference held in New York during June were live stock, the War Finance Corporation has printed. The JuVy conferences have related determined to make loans to national and State not merely to technical questions of financing, banks on farmers' paper. This plan will enable but also to a variety of topics indirectly all national and State banks to assist deserving influencing the method to be employed in farmers with full knowledge of the fact that the carrying the crop. In this connection the resultant paper can and will be taken by the suggestions made by Governor Harding in his War Finance Corporation. Pursuant to this address at New York, and by the Board itself determination, the board of directors of the corin past years, have been repeated. The Board poration on July 22 and 23 announced that it then laid stress upon the necessity of careful had telegraphed the Federal Reserve Banks of warehousing and upon the desirability of grad- Dallas, Kansas City, Minneapolis, Richmond, ual marketing in order to spread the operation Atlanta, St. Louis, and San Francisco, requestof financing over a considerable period. Since ing them to notify the banks and trust comthe discussion of the cotton question two years panies in their respective districts, nonmembers ago the only change that has occurred in the as well as members of the Federal Reserve sys- Board's regulations has been the suspension of tem, of their willingness to make advances the so-called commodity rate applying to all under section VII of the War Finance Corporapaper protected by warehoused staples, that tion Act to banks and trust companies which rate having been merged with the regular had made loans to farmers and cattlemen. commercial rate. The essence of Governor Federal Reserve Banks in their capacity of Ilarding's suggestions with respect to the use fiscal agents of the corporation will furnish of the acceptance plan was expressed in his full particulars regarding the loans. statement in New York that— Under the terms of the War Finance Corporation Act these advances are limited to 75 as far as foreign shipments are concerned, we are accustomed to long drafts, for no one per cent of the amount of the loans made by draws a draft on a ManchesterjTmill payable on the borrowing institution, or to 100 per cent in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

692 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. case the borrowing institution itself furnishes was 58.4 per cent, this proportion has gone additional collateral to the extent of 33 per down to about 50 per cent. All Federal Recent of the advance. Such advances will be serve Banks, except Richmond and Chicago, made by the War Finance Corporation upon share in this decrease. For the New York written application through the several Federal bank alone a decrease of this proportion from Reserve Banks, acting as its fiscal agents. about 80 to 64 per cent is noted. They will be granted only after consideration Acceptances on hand decreased from 232.5 to of the recommendations of the banks and upon 206 millions, net liquidation of this class of the promissory note of the borrowing institu- paper at the New York and Philadelphia banks tion secured by the obligations of the farmers amounting to a slightly larger total. United and cattlemen to whom loans have been made States short-term obligations, owing partly to by the institutions, together with BUY security the repurchase by banks and the redemption taken for such obligations. by the Government of Treasury certificates, Increased discount operations of the Federal fell off from 35.9 to 16.4 millions. No appre- Operations of Reserve Banks, largely in con- ciable changes in other earning assets, includt2ie Federal Re- noction with the two issues of ing United States bonds, are shown. serve Banks, Treasury certificates, effected During the period under review the banks' between June 25 and July 18. and moderate gold reserves increased steadily from 1,924.4 liquidation of acceptances are the most note- to 1,975.4 millions, while their net deposits worthy features of more recent development at went up from 1,445.4 to 1,566.7 millions. the Federal Reserve Banks. Federal Reserve notes in actual circulation The upward development started in July, show a growth of over 150 millions, from 1,678 figures for the last Friday in June indicating to 1,829 millions. The ratio of cash reserves to reductions of almost 110 millions in war-loan aggregate net deposit and Federal Reserve note paper, i. e., member banks' notes secured by liabilities declined from 83,4 to 59.8 per cent. United States war obligations and customers' In the following table are shown the changes paper similarly secured, and of over 62 millions between June 21 and July 19, 1918, in the in total discounts held. Since then total dis- total discounted and purchased bills held by counts increased by 334.2 millions and those of each of the Federal Reserve Banks, also war loan paper alone by 166.9 millions. De- changes between the two dates in the holdings velopments at the New York bank follow a of other classes of investments. similar course, total discounts on hand showing [:In thousands of dollars; i. c, 000's omitted.] an increase during the iirst three weeks in July of about 150 millions, and those of war loan Federal Reserve Bank. June 21. July 19. N cr e e t a s in e. - N cr e e t a d se e . paper alone an increase of 98.2 millions, Boston 66.180 110,856 44,676 though the bank's July 19 holdings of dis- New York 506,761 513,731 6,970 Philadelphia 74,959 84,066 9,107 counted bills, and in like manner its holdings Cleveland 66,804 306,070 39,266 Richmond 56,643 60,982 4,339 of war loan paper, were smaller than a week Atlanta 30,519 37,391 6,872 Chicago 134,597 209.829 75,232 earlier. The banks at Boston, Chicago, and St. Louis 50,132 59!643 9.511 Minneapolis | 35,116 51,809 16;693 Minneapolis report a continuous upward move- Kansas Oil; v 56,862 68,989 12,127 Dallas ". 29.922 33,402 3,480 ment of total discounts on hand for the entire San Francisco 55', 247 72,510 17,263 period under review, while all the banks, ex- Total 1.1, 103, 742 1,409,278 245,536 United States long-term j cept those at Kansas City and Dallas, report securities ." j 40,877 40,259 018 United States short-term j substantial increases in their holdings of war- securities ! 35,883 16,358 19,525 Other earning assets ! 100 loan paper. Since June 21, when the share of war-loan paper in the total discounts on hand Total investments held. j 1,240,602 1,465,993 225,391 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 693 Substantial reductions in the holdings of Loans and investments of all reporting banks, Government securities, chiefly exclusive of fixed investments, such as bank meCmbedritbanks?f Treasury certificates, also de-premises and other real estate, furniture, and creases in demand deposits and fixtures, also Federal Reserve Bank stock, inreserves of member banks in the leading cities, creased from 12,506.2 millions to 12,555.7 milcontinued during the latter part of June and lions, while the combined share of United the first week in July. An upward movement States war obligations and of loans secured by along these lines set in during the second week, such obligations in the totals just given deapparently the result of the placing about the clined from 16.4 to 14.2 per cent. For the end of June of the new issue of $750,000,000 central reserve city banks this percentage shows Treasury certificates. a decline from 20.6 to 16.3 per cent and for the Treasury certificates held by all reporting Greater New York member banks a decline member banks decreased from 945.2 to 615.1 from 23.1 to 17 per cent. millions between June 14 and July 7 and in- Government deposits of all reporting banks creased to 735.5 on July 12. Holdings of increased from 868.3 on June 14 to 1,212 United States bonds, other than circulation millions on June 28. Since then a decline to bonds, show a small though a practically con- 815.8 millions on July 12 is noted. For the tinuous decline from 586.7 to 557.7 millions on banks in the central reserve cities a correspond- July 12. A corresponding decrease from 518.4 ing increase from 449.8 to 692.6 millions during to 485.0 millions is noted in total loans secured the latter part of June is shown, followed by a by Government war obligations. decline to 508.1 millions during the first two Corresponding figures for member banks in weeks in July. Total time deposits increased central reserve cities indicate a relatively much from 1,323.4 to 1,410, while total net demand larger decrease in the holdings of Treasury deposits show a decline from. 9,247 to 8,801.5 certificates from 707.1 to 364.1 millions be- millions between June 14 and July 5 and a gain tween June 14 and July 5 and a subsequent in- to 9,029.9 millions for the following week. At crease to 443.4 millions on July 12, also small the central reserve city banks a similar decline decreases from 310.3 to 296.1 millions in from 5,071.1 to 4,743.5 and a subsequent gain United States bonds, other than circulation to 4,896.1 millions are noted. bonds, and from 284 to 274 millions in loans Reserves of all reporting banks show some secured by United States war obligations. A fluctuation from week to week and on Jui}^ 12 similar development is indicated for the mem- stood at 1,142.6 millions, compared with ber banks in Greater New York, which report 1,226.3 millions a month before. a continuous reduction in the holdings of During the four weeks under review the ratio certificates from 670.9 to 310.1 millions on of combined reserve and cash to totalnet, includ- July 5 and a moderate gain on the following ing Government deposits, declined from 15 to Friday. 14.7 per cent for all reporting banks and from Aggregate holdings of United States securi- 16 to 15,7 per cent for the banks in the central ties, exclusive of circulation bonds, and of reserve cities. Figures of excess reserves, in loans supported by United States war obliga- the calculation of which no account is taken of tions decreased during the four weeks from Government deposits, show considerable fluctu- 2,050.3 to 1,778.2 millions, or 13.3 per cent. ations from week to week, reaching a maximum During the same period the central reserve of 198.1 millions on June 28 and standing at city banks show a reduction of these items 68.4 millions on July 12, compared with 129.2 from 1,301.4 to 1,013.5 millions, or of 22.1 per millions on June 14. Changes in the excess cent, and the Greater New York member reserves of the central reserve city banks follow banks a decrease from 1,165.2 to 834.6 millions, practically the same course, the June 28 figure or of 28.4 per cent. of 183.3 millions marking the high point, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

694 FEDERAL RESEEVE BULLETIN. AUGUST 1, 1918, though the decrease since June 14 is consider- Ever since the establishment of Federal Reably smaller for these banks than for the banks serve Banks the Board has en- Concentration in the other reserve cities, for which a fall in deavored by every legitimate of gold. excess reserves from 49.7 to 8.3 is noted. means to increase the aggregate The operations of the Board's gold export gold holdings of the banks. Since the entry of committee during the month the United States into the war the necessity of Movement of gold, ending July 20 have resulted such effort has been greatly emphasized/ while in the issuance of licenses per- the inclination of the public and of the banks mitting the shipment of $3,696,389 gold. Of to cooperate in it has been marked. Very large this sum, the bulk has gone to Mexico. In quantities of gold and gold certificates have general, applications from most quarters for been withdrawn from circulation and transthe shipment of gold have been lighter during ferred to the vaults of Federal Reserve the past month than for some time previously, Banks; but there still remain in circulation largely owing to better understanding of the and bank vaults considerable quantities both conditions under which licenses are issued. in gold certificates and coin that can and Since the development of the system of control should be deposited, their place being taken of Italian exchange, lira quotations have de- so far as necessary by paper currency. Of cidedly improved. A financial commission has late the Board has received questions from gone abroad on behalf of the United States and various quarters respecting the reasons of will devote especial attention to the study of theory supporting the course which it has the exchange problem. urged with respect to gold. The situation in From June 15 to July 10, inclusive, the net this 'regard is perfectly plain. In proportion inward movement of gold was §12,281,000, as the gold holdings of the Federal Reserve compared with $19,410,000 for the preceding Banks are increased, the ability of such banks four weeks. Gold imports for the period under to extend accommodation to other banks or to review, amounting to $14,631,000, came issue notes is enlarged. Taking 40 per cent in largely from Canada and Mexico, while gold gold as normally required as a minimum behind exports totaling $2,350,000 were consigned every note that is issued, it is clear that in chiefly to Mexico, Canada, and the Dutch order to lend $100 in Federal Reserve notes a East Indies. These considerable imports rep- Federal Reserve Bank must have on hand in its resent withdrawals of gold held by the Federal vaults or with a Federal Reserve agent $40 in Reserve Banks with their foreign agencies, gold. In proportion as its reserve holding is these holdings showing a reduction since the curtailed, its lending power is correspondingly beginning of June from $52,500,000 to about reduced. Some question has also been raised $15,500,000 on July 12. with reference to the practice of hoarding gold. The gain in the country's stock of gold since Every dollar of gold that is hoarded is with- August 1, 1914, was $1,078,383,000, as may drawn not only from reserve use but also from be seen from the following exhibit: circulation. It is a net loss of that amount of [.000 omitted.] metal to the community. The effect of its concealment is therefore to remove the possi- Excess of bility of providing the strongest possible gold imports Imports. o v'er cover for our growing volume of bank notes and exports. deposits. The desirable condition under exist- Aug. 1 to Doc. 31, 1914 $23,253 §104,072 i 8*1,719 ing circumstances is to have every dollar of Jan. 1 to Dec. 31,191f> 451,955 31,426 420,529 Jan. 1 to Dec. 31,1010 685,745 155,793 529,952 gold in the Federal Reserve Banks, while Jan. 1 to Dec. 31,1017 553,713 372,171 181,542 Jan. 1 to July 10,1918 50,449 22,370 28,079 the circulating medium consists of currency Total. 1,7C5,115 686,732 1,078,383 based on gold. Money of every kind, whether gold or silver, should be deposited in bank i Excess of exports over imports. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 695 and used but not hoarded. Surrender of gold Applications for the establishment of several coin and gold certificates and abstention from additional foreign branches by hoarding means an increase in the volume of Preparation for A . , \i i_ -L foreign trade American banks have been bank credit available for the community and granted by the Board and the increased ability to finance its war and other total list of such branches now in existence requirements. is given elsewhere in the present issue, with By-laws for the new branches of the Atlanta eertain additional data concerning the devel- Federal Reserve Bank at Birment of foreign banking. In three ways mingham and Jacksonville have American banks are beginning to lay the founbeen approved by the Board dations of the system which will furnish a basis and the date of opening for the two new for the expansion and financing of our foreign institutions was set at August 1 and August 5, trade after the close of the war. One of these respectively. No further action has been is the direct establishment of branches as just taken with reference to any other pending indicated. In addition there is an evident application, but the Board is awaiting the outdisposition on the part of the banking comcome of investigations and inquiries which it munity to undertake the organization of forhas set on foot and whose results can not be eign banking corporations. One or two promimmediately secured. The number of branches ising additions to the existing list of such corof the Federal Reserve Banks in operation is porations have either been established or are now 15, and tliese branches differ sufficiently now in prospect, contemplating as their field in their local problems and conditions to permit of operation China and Italy, respectively. of very valuable conclusions, based upon actual experience, within the next few months. The The third line of progress is found in the adopobtaining of these conclusions, in consequence tion of plans for the creation of discount comofJclose and careful study of the situation at panies dealing in paper growing largely out of each of the branches, will undoubtedly throw foreign business. These latter enterprises are much light upon the lines along which the in a measure analogous to the discount houses branch system must be evolved in the future. well known in London. Progress in these direc- Experience thus far has shown that a reason- tions during the last year has been continuous, ably well equipped branch is likely to cost at and the outlook is now more promising than it the outset from $40,000 to $50,000 per annum has been for some time past. Further develif established on the present basis. The addi- opment along these lines is most desirable tion of that amount to the actual cost of the with a view to furnishing additional accommooperation of a Federal Reserve Bank is suffi- dation and enlarging existing exchange arrangecient to warrant very careful consideration ments for American business men engaged in and inquiry as to the necessity of any given trade with other countries. In spite of the obbrancKbefore actually taking steps to create it. stacles afforded by the war and the interrup- Apart from the nomination of the officers tions to trade which inevitably grow out of it, and directors of the new branches the only the conditions under which such banks can change since the opening of July in the direc- successfully be established are to-day much torate of the banks has occurred in Boston. more favorable for making a beginning than At an election held on June 29, the results of they are likely to be after the close of the war which have since been made known, Mr. It is in the interest of the country that Ameri- Philipp. Allen was chosen a Class B Director can institutions continue as rapidly as possible of the^Federal Reserve Bank of Boston. Mr. with the mapping out of the field and the doing Allen's election fills the vacancy caused by the of foundation work necessary to insure the resignation of Mr. Charles B. Morss, who some United States its due share in the development time ago was elected governor of the bank. of the world's business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

696 FEDERAL RESERVE BULLETIN. AUGUST T, 1918. The Board hopes that Congress will soon The Phclan bill (H. R. 11283), which is be able to act upon its recommendation fre- reprinted in this issue in the form in which it quently made that provision be made for the passed the House, embraces all of the recom- Federal incorporation of banks which desire to mendations made by the Board, except that undertake foreign operations. it does not include any provision for the Fed- Comparative figures for the development of eral incorporation of banks organized to do a the Federal Reserve system in foreign business, or for enabling national banks Growth in num- membership during the past in certain cases to establish branches within ber of State bank , £ -p • • 1 the corporate limits of the cities or towns in members. half-year show a gratifying inwhich they are located, where the State laws crease in the nonnational bank do not prohibit the establishment of branches membership of the system in practically every by State banks or trust companies. district. The figures are published in full elsewhere in the present issue. They permit, Section 2 of the Phelan bill, which proposes however, the following comparisons: to amend and re-enact section Ilk of the Federal Reserve Act, was not recommended by Members Members the Board in its last annual report, but this District. Jan. 1. July 31. section is not, in the opinion of the Board, de- No. I—Boston 13 i 24 serving of the criticism to which it has been N N o o . . 3 2— — N Ph ew il a Y de o l r p k hia... 7 1 4 8 subjected. Wherever nn&neial institutions of N N o o . . 4 5 — — C R l i e c v h e m la o n n d d 2 4 3 0 one class, such as trust companies, are author- N N o o . . 6 7— — C A h tl ic a a n g ta o 1 4 4 1 4 ized to transact a general banking business, it N N o o . . 9 8— — S M t. i n L n o e u a i p s olis... 2 4 9 4 does not appear inequitable that other banks N N o o . . 1 II 0 — — D K a a l n la s s as City... 2 7 2 1 thus brought into competition, should be No. 12—San Francisco. 59 allowed the exercise of reasonable trust powers. Total. 250 ! 589 The Board has not under contemplation at this time an}r further recommendations for A comparison based upon capital stock is amendments to the act. not, in this case, as enlightening as compara- Elsewhere in this issue of the BULLETIN there tive figures for number of banks entering the is printed a formal report of the system, due to the fact that it is now the Work of Capital ^ .. -, r ^ >tl P institutions of small or medium size which Issues Committee. CaPlt;al Issues Committee of are to a large extent applying for membership. the Federal Reserve Board to Not only the growth itself but its wide dif- the Board itself. It will, of course, be underfusion throughout the United States and the stood that the Capital Issues Committee here large proportion which it bears to the mem- referred to is the old or original committee bership as reported on January 1 are encour- created by the Board soon after the opening of the year 1918, and which was superseded by aging factors. the present Capital Issues Committee created In view of some misunderstanding which by Congress and consisting of three members seems to have arisen as to the Amendments to of the Board sitting with four other memattitude of the Board regardact. bers. The report of the committee brings to a ing amendments to the Federal definite close this first step in the history of the Reserve Act, it is proper to say that the Board undertaking. Some time ago, when the memhas not during the present session of Congress bers of the original committee went out of recommended any changes in the Federal office, upon the appointment of their succes- Reserve Act, except those enumerated on sors under the new act, the Board placed on pages 31, 32, and 33 of its annual report to record sundry resolutions which it is deemed Congress for the year 1917. proper now to reproduce as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN, 697 Whereas Messrs. Allen B. Forbes, Frederic H. Goff, and reporting service, as the desired information Henry C. Flower have served as members of the advisory may be drawn largely from standard trade committee of the Capital Issues Committee of the Federal publications. Reserve Board; and Whereas Mr. Bradley W. Palmer has served as counsel (2) In the case of the banking and interest to said committee; and rate index, however, it is possible through the Whereas Mr. Stephen L. Selden has served as executive mechanism of Federal Reserve Banks to work secretary and Mr. James Q. Newton as assistant executive out a systematic plan for the collection of the secretary; and desired information. The data will be ob- Whereas they have all given their services in a voluntary tained by the Federal Reserve Banks largely capacity: Be it Resolved, That the Federal Reserve Board expresses to from the member banks. all of them its sincere gratitude for the excellent services It is expected in successive numbers of the rendered by them. They accepted the difficult task in an FEDERAL RESERVE BULLETIN to present severunselfish spiiit of patriotism, and the singleness of purpose ally the plans for developing the various indexes and high efficiency with which they accomplished their work has been a credit to the Board and of genuine benefit as fast as they are matured. to the country. INDEX NUMBERS OF WHOLESALE PRICES. Mr. F. A. Delano, whose retirement as a member of the Federal Reserve Attention has been directed toward the Departure of , ... , , ,, o several phases presented by wholesale price F 4 Delano -Hoard was permitted by the index numbers, and certain broad guiding President in order that he principles, which it is believed to be desirable might undertake military engineering duties to observe in their construction, have been in France, finally terminated his duties with outlined as a result of this survey. Progress the Board on July 22 and has been transferred has been made in the actual construction of to foreign service as a Major of Engineers. In an index number along these lines. the BULLETIN for July record has been made It is believed desirable for the purpose in of the Board's resolutions adopted upon first hand, to show the ebb and flow of business as learning of Mr. Delano's resignation, and it reflected by the course of wholesale prices, that remains only to be added that the loss due to the number of commodities included should be his withdrawal, now that it has become a fact, somewhat more restricted than is the case in is even more keenly appreciated as a void that certain of the existing series, and from 50 to it will be hard to fill. 60 was fixed as a first approximation. The commodities selected comprise, of course, raw materials, to which series designed to serve as business barometers are often confined. Such Indexes of Business Conditions. limitation is usually based on the ground that During the month of July work toward the these commodities are more sensitive in their development of the Federal Reserve Board's price fluctuations and hence more accurately system of business indexes has been devoted to reflect changes in business conditions. Manuthe gathering and collection of general material factured goods have, however, also been inand to the preparatory work incident to the cluded, as it is believed that the omission of installation of two of the indexes previously the latter would result in giving merely a decided upon. These are the wholesale price partial view of the field. Furthermore, the index and the interest rate index. The two price fluctuations of the two groups are disindexes were selected for the following reasons: similar in important particulars. Separate (1) The data required for the wholesale index numbers for the several distinct groups price index numbers are readily available. It of commodities may also be presented. The is not necessary to install an elaborate private commodities included have been selected from 72715—18 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

698 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. among the articles playing the more important general form in which the number would be part in the national economy, and quotations presented, namely, that complete recomputahave been used for the more important markets tion is necessary if it be desired to shift the for these articles. The data may be taken base, is minimized. principally from standard trade journals, sup- Thorough tests of any newly devised index plemented by private sources when deemed number are, of course, necessary before publinecessary or expedient. cation. This requires the institution of a care- The problem of weighting, which had next to ful comparison, mainly with existing index be considered, presented certain difficulties. numbers, as regards the direction and degree After careful consideration, it was decided that of price changes. Only in this manner is it no formal system of weights should be em- possible to secure an index number which will ployed. As is well known, the deficiency of stand critical test from the scientific point of existing data bearing upon the relative impor- view. tance of the several commodities necessitates The plan thus outlined, calling as it does for recourse to more or less arbitrary methods, if the construction of a new index number, and formal weighting be attempted. The same re- indicating the lines along which tins developsult may be approximated through the careful ment should proceed, is to be regarded as proselection of commodities, the endeavor being visional. Negotiations are pending with the made to secure a well-balanced list which does Bureau of Labor Statistics whereby the regunot give disproportionate representation to any lar wholesale price index number of the bureau one class. In so doing it has been found ad- may be made available each month for publivisable in some instances to merge the quota- cation in the FEDERAL RESERVE BULLETIN. tions of several related articles into one series This very comprehensive index number Jias( before employing them directly in the index. been subject to considerable delay in publica-S Textiles may be mentioned as a case in point. tiori lit the past, but monthly preparation of it! By the use of this method, several of the more has recently begun, and the Board may find important groups of commodities may be the use of this comprehensive index advisable^ included without assigning to them undue importance in the general index, and at the BANKING AND INTEREST INDEX. same time the data employed will be more After consulting with various bankers and representative than if the quotation for one banking experts it was determined to ask for article alone were used. specified classes of information with reference It will be noted that the procedure outlined to interest rates and also to request the banks above determines in large measure the form of to collect earlier data for three selected years, presentation of the final results. Relative such data to serve as a basis with which to figures must t e computed for each of the several compare the later quotations transmitted to eommoditijes, and these averaged to secure the the Board from month to month. While it index number. This involves the selection of will probably be true that in a number of cases a base period, which should be taken to include the task of obtaining reliable data for the years the years immediately preceding the opening before the organization of the Federal Reserve of the present war in 1914. A direct compari- system will not be easy, it is believed that son of the present price level with that existing enough can be had to afford a reasonably in these years would thus be afforded, and the accurate figure from which to reckon the changes due to war conditions would be variations that have been exhibited by the brought into relief. As a comparison of this changes in interest rates since the organkind is believed to be of most importance, the ization of the Federal Reserve system. After objection raised in recent years against the the information has been completely furnished Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 699 by all of the Federal Reserve Banks, in so far (6) Prevailing rate of interest for time paper secured as they are able to obtain it, and has been by collateral mentioned in 5: (a) Running 3 months. tabulated, it will be possible to reach a final (6) Running 3 to 6 months. conclusion as to the extent to which really In addition to the foregoing it is desired that you obtain comparable statistics can be obtained for all and transmit these same data for the years 1911, 1912, and Federal Reserve districts in each of the classes 1913, quotations, likewise, to be for the months ending the of paper selected as a basis for study. Modifi- 15th throughout the period covered. In case the class of paper generally handled by banks in your district is cations may be made in the scope of the inquiry different from those enumerated, please so state and wherever such change is necessary, in order to give quotations for the class of paper typical of your disinsure uniformity and comparability. trict. It is suggested that the larger member banks in The following letter, which was sent out to all your district that have been active discounters or pur- Federal Reserve Banks, will serve to show the chasers in the past of the various classes of paper above described may be able to furnish the desired information scope of the preliminary investigation into from their own records. This will insure uniform treatinterest and discount rates: ment and continuity of the data; moreover, these data JULY 17, 1918. will represent actual transactions and not merely nominal DEAR SIR: Inclosed herewith I am handing you a copy quotations, such as are likely to be furnished by bill of the FEDERAL RESERVE BULLETIN for July, which has brokers and commercial paper houses. just been issued. On pages 597-600 you will find a state- Kindly advise the Board at your early convenience by ment of a new service which the Board is planning and telegraph furnishing these data for the month ending July which is designed to furnish information with respect to 15, 1918, for your city and advise how soon you will be business conditions. A reading of this statement will able to transmit the figures for past years; also whether afford a fairly comprehensive idea of what is intended. they can be obtained in the same way at the places in The complete development of the plan will require several which your branches, if any, are located. months; but it is desired to begin the publication of the different factors in the proposed series of business indices as soon as possible and without waiting for the completion Third Issue of Treasury Certificates. of the whole series. The data relating to ,-anfcing—and to discount and interest rates particularly—are those which The following statement was issued by the should receive first attention, and it is therefore requested Treasury on July 20: that you consider carefully subsection (d) in the state- In consequence of the over-subscription of ment to which reference has already been made. The the first two issues of Treasury certificates in Board desires that you will obtain and transmit on the anticipation of the fourth Liberty loan and the 15th of each month, or where the 15th falls on a Sunday increased returns from war savings certifior a holiday, on the next business day thereafter, data cates and from income and excess profit taxes, regarding high ana low rates, also rates at which the bulk the Secretary of the Treasury finds it possible of the several classes of paper shown below was discounted to reduce the minimum amount of the third or purchased during the preceding 30-day period: biweekly offering of Treasury certificates to (1) Prevailing rate of discount charged by banks to $500,000,000. This, however, is only a minicustomers for prime commercial paper such as is mum amount and those institutions which now eligible under the Federal Reserve Act: have made arrangements to subscribe their (a) Running 30, 60, 90 days. share on the basis of an offering of $750,000,000 (6) Running 4 to 6 months. will be free to do so. (2) Prevailing rates for prime commercial paper pur- The Secretary of the Treasury, under the chased in open market: authority of the act approved September 24, (a) Running 30, 60, 90 days. 1917, as amended by the act approved April 4, (b) Running 4 to 6 months. 1918, offers for subscription, at par and (3) Prevailing rates charged on interbank loans (bills accrued interest, through the Federal Eeserve payable). Banks, $500,000,000 or more Treasury cer- (4) Prevailing rates of interest f a bankers' acceptances tificates of indebtedness, series IV C, dated and of 60 to 90 days' maturities, both indorsed and bearing interest from July 23, 1918, payable unindorsed. November 21, 1918, with"interest at the rate (5) Prevailing rate of interest for demand papei seof 4^ per cent per annum. Applications will cured b> prime stock exchange collateral of be received at the Federal Reserve Banks. other current collateral. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

700 FEDERAL BESEBVE BULLETIN. AUGUST J, 1918, Subscription books will close at the close of in excess of existing deposits when so notified business July 30, 1918. by Federal Reserve Banks. As fiscal agents of Certificates will be issued in denominations the United States Federal Reserve Banks are of $500, $1,000, $5,000, $10,000, and $100,000. authorized and requested to receive subscrip- Said certificates shall be exempt, both as to tions and to make allotment in full in the order principal and interest, from all taxation now of the receipt of applications up to amounts or hereafter imposed by the United States, any specified in their respective districts. State, or any of the possessions of the United States, or by any local taxing authority, except (a) estate or inheritance taxes, and EARNINGS AND EXPENSES OF THE FED- (ft) graduated additional income taxes, commonly known as surtaxes, and excess profits ERAL RESERVE BANKS. and war profits taxes, now or hereafter imposed by the United States, upon the income or profits Total earnings of the Federal Reserve Banks of individuals, partnerships, associations, or for the six months ending June 30, 1918, were corporations. $24,850,190, compared with $4,141,528 for the The interest on an amount of bonds and corresponding period in 1917, while total curcertificates authorized by said act approved rent expenses for the same period were September 24, or by said act as amended by $4,152,028, compared with $1,378,883 in 1917. said act approved April 4, 1918, the principal of which does not exceed in the aggregate Current expenses for the first half of the 15,000, owned by any individual, partnership, present year are made up of $3,114,149 of association, or corporation, shall be exempt expenses of operation proper: $631,380, the from the taxes provided for in clause (6) above. cost of Federal Reserve notes and bank notes, Upon 10 days7 public notice, given in such including express age, insurance, and other manner as may be determined by the Secretary of the Treasury, the certificates of this series expenses incident to the issue, exchange, and may be redeemed as a whole at par and accrued redemption of notes; $356,344 of depreciation interest on or after any date, occurring before charges on bank premises, furniture, and equipthe maturity of such certificates, set for the ment; also, $50,155, the cost of alteration and payment of the first installment of the subremodeling of bank premises in use. The scription price of any bonds offered for subscription by the United States after the offering total shown is exclusive of disbursements of and before the maturity of such certificates. the fiscal agent departments. These disburse- The certificates of this series, whether or not ments are treated separately, being reimbursable called for redemption, will be accepted at par, by the United States Treasury Department. with adjustment of accrued interest, if tendered on such installment date in payment on the Net earnings of the banks, i. e., the excess subscription price then payable of any such of earnings over current expenses, aggregated bonds subscribed for by and allotted to holders $20,698,162, or at a yearly rate of 55.9 per of such certificates. cent on an average paid-in capital of The certificates of this series do not bear the $74,095,000, compared with 9.8 per cent for circulation privilege and will not be accepted in payment of taxes. The right is reserved to the first six months of 1917. New York reject any subscription and to allot less than reports net earnings at the yearly rate of 96.9 the amount of certificates applied for and to per cent, and Kansas City at the rate of 60.1 close the subscriptions at any time without per cent; net earnings of five banks were at notice. Payment at par and accrued interest rates between 40 and 50 per cent, while net for certificates allotted must be made on and earnings of three other banks were in excess after Juty 23, 1918, and on or before July 30, 1918. After allotment and upon payment Fed- of 30 though less thjtm 40 per cent per annum, eral Reserve Banks will issue interim receipts All of the banks paid their 6 per cent divipending delivery of the definitive certificates. dends to the end of June, the Philadelphia, (Qualified depositaries will be permitted to make Cleveland, Kansas City, and Dallas banks payment by credit for certificates allotted to paying cumulative dividends for the 12 months them for themselves and their customers up to an amount for which each shall have qualified ending June, the St. Louis and San Francisco Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, li>18. f-F:DEHAL RESERVE BULLKTIK. 01 banks cumulative divideiKls for the 18-month Reserve Banks, earnings from the sale of forperiod ending June, and the remaining six eign exchange, and other smaller miscellaneous banks the regular dividend for the six months profits. of the present year. Of the total expenses of operation for the Of the total earnings for the six months of 6-month period. 37.6 per cent, as against 24.1 the present year 59.2 per cent, compared with per cent during the corresponding period in 20.3 per cent in 1917, wasfrom bills discounted 1917, went as salaries to the clerical staff and for member banks, the large increase in the per- 13.5 per cent, as against 28.2 per cent in 1917, centage Fefleeting"mainlyr"tiic additional earn- as compensation to bank officers. Amounts ings of the banks from the discount of war paper, collected from the Federal Reserve Banks for i. e., member banks' notes, also customers' the support of the Federal Reserve Board paper supported by United States war obliga- totaled 8185,116. as against 8111,395 in 1917, tions. Earnings from bills bought in the open constituting 5.9 per cent of the total operating market constituted 22.6 per cent, compared expenses of the Federal Reserve Banks, as with 40.9 per cent in 1917, and earnings from against 11.2 per cent for the first six months in United States securities were 9.9 per cent as 1917. Other important items of expense, in against 24.3 per cent in 1917, notwithstanding the order of volume, were postage, printing and the [increase in these earnings from about 1 stationery, rent, and expressagc. million to nearly 2J millions during the present Current expenses shown are exclusive of year. Earnings from these three classes of 86,425,102 disbursed during the six months by investments account for 91.7 per cent of the the banks7 fiscal agent departments. These total earnings. About $432,000, or 1.8 per cent amounts are reimbursable by the Treasury of the total earnings, is represented by earnings Department and are therefore treated sepafrom bank transfers, and about §415,000 by net rately from the banks' current expenses proper*. service charges received in connection with the Additional net investment in bank premises clearing and collection of checks, which charges during the same period amounted to $1,194,263, were discontinued on June 15. The remain- the Boston, Philadelphia, Richmond, Atlanta, der of the earnings—about 4.8 per cent—is Dallas, and San Francisco banks reporting a made up of penalties and interest charges on total investment on July 1, 1918, of $1,901,874 deficient reserves, commissions received on in banking houses of their own or ground on bills and securities purchased for other Federal which to build such houses. Earnings and current expenses of each Federal Reserve Bank and of the system., as a whole for the 6 months ending June 29, 1918. EARNINGS. ! Boston. Y N o e r w k'. Ph p i h la ia d . el- C la le n v d e . - m R o ic n h d - . A t tl a a , n- Chicago. Lo S u t. is. M ap i o n l n is e . - K C a i n t s v a . s i Dallas.! i F S ra a n n - !| Total. ! i cisco. Bills discounted l$l, 054,210 S5,890,392 §702,451 •1949,550 «l. 059 S350,248 SI, £00,809 $722,037 $371,844 S884.005iS4l3.0fiB 8750,813;S14,723,0fe7 Acceptances bought. -' 324,739 2,827,229 394,585 334,77" 148^465 133,754 534,352 148,6771 105,19! 76,789! 132; 551 463,110' 5,624,219 United States securi- i ties | 43,837 1,051,730 155.862 464,755 40,393 75,692 ,7121 4422,.73o| 86.254j 182.766: 89,682! 59,619! 2,455,035 Municipal warrants..: 2,367 ' 49 2,026 '6021. i ' 61 i 7,995 : 1133,.110055 Profits realized on j United Slates se- '• curitics i 25,088 (5,789 32.477 Transfers—Net earn- ! ings ! 17.887 17,645 150,574 j 23.3I6J 87,088; 02,358; 46,3221 45,916j 431,706 Deficient reserve pen-; allies (including in- i Ne tc t re s s e t r ) v ice charg .. e . s . .| ! 7,315 6,500 13,146 26,004 49,080; 14,870 29,415 J | 22,806; 7,40S| 31,565; ! 32,C94| 254,302 recci ved ; 59,094 so, io: 47,714 41,030 49,214] 21,753 23,405! 22.812! 27.7I01 2^.323; 20,032! 415,432 Commissions received; 12,5SS ...'....' 35,0951 >7,683 Bundr v profits I "198,7)79 435,702 "3«,*284 '" 1*2," 150 17,028' 10.603 83, w 7;t>05! 2,050; 853,145 Totai earnings.; 1,688,47410,282,675 1,352,0911,872,447 1,126,419; 089,380 2,784,126 <)9S,,->S5| 05*>, r : 015; 745,24-J;l, 409,329J24,850,190 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

702 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. Earnings and current expenses of each Federal Reserve Bank and of the si/rre.n as a whok for the 6 months ending June 29, 1918—Continued. CURRENT EXPKXSSS. Boston. Y N o e r w k . I Ph p i h la ia a . el- C la lo n v d e . - m R o ic n h d - . Al l l a a . n- | x ,-,Ma*- Qa™go . Lo S u t i . S i : M apo in li n 3> e - K C a it n V s i as Dallas. F c S i r s a a c n n o - . Total. i Ex no rises oi" operation: Assessments ac- \our.t; expenses Federal Reserve Board $13,182 §50,449 §16,583 $21,671 $6,582 $7,741 $24,548 $9,381 I $7,079 $9,169 $7,546 $11,185 $185,116 Federal Adviso- I ry Council (fees and traveling \ expenses) j 285 1,060 253 456 150 205 315 352 150 210 1,498 3,043 7,977 Governor's con- j ferences (i n - \ eluding travel- | ing expenses)...! 70 145 160 70 122 ! 194 127 107 354 1,349 Federal Reserve i Agents' conferences (including traveling expenses) | 37 84 67 162 128 142 160 ! 144 ! 180 155 172 ; 601 2,032 Salaries— ; Bank officers. 33,950 | 90,788 38,375 23,833 25,935 47,196 33,925 24,477 31,395 42,426 419,186 Clerical staff.. 96,862 I 309,628 136,875 102,415 54,992 36,803 126,389 62,687 41,816 56,521 48,386 97;764 1,171,138 Special officers and ! watchmen . \ 3,394 I 10,528 5,858 2,076 1,750 10,554 2,340 2,177 1,586 765 41,028 Allother ! 3,679 1,962 618 3,907 1,230 365 2,291 232 14,323 Directors'fees—; 2,010 9,405 2,220 1,700 1,465 2,230 3,065 1,602 30,862 Per diem al- j 1,010 3,735 730 lowance — 540 60 490 320 220 800 420 1,036 7,839 Tr aveling 1,248 1,865 489 expenses... 447 530 707 697 478 1,075 648 10,431 Officers' and 1,380 3,285 795 clerks' traveling expenses... 1,341 2,930 5,293 1,742 1,005 3,107 829 2,420 5,547 26,906 Legal fees 1,200 570 1,122 525 1,750 750 300 1,215 1,423 8,855 Rent 16,107 "57," 429' 4,342 15,419 2,270 8,687 21,014 9,634 5,133 9,205 336 13,205 162,781 Taxes and fire insurance 2,083 474 43 450 23 32 U9 122 3,228 Telephone 2,572 | 5,691 2,957 2,844 895 274 2,597 874 1,223 1,128 661 1,971 23,687 Telegraph 621 j 1,573 632 1,292 1,013 765 2,965 903 1,236 1,116 1,199 3,607 16,922 22,417 j 37,196 15,707 24,561 19,488 11,873 22,273 14,543 14,874 23,234 9,928 19,765 235,859 Expressage 10,065 12,037 10,766 2,445 1,984 1,950 5,563 4,585 8,951 151 11,942 23,744 Insurance and premiums on fidelity bonds... 5,688 7,392 I 3,934 7,318 512 1,689 3,474 2,735 2,779 4,799 130 11,150 51,420 Light, heat and j power ! 2,277 5,387 I 963 967 2,101 124 2,037 965 1,157 696 16,674 Printing and stationery 13,434 41,441 j 10,552 23,798 15,875 4,063 23,106 6,693 8,761 9,457 5,278 20,257 182,715 Repairs and alterations 774 5,962 \ 221 6,270 4,180 46 3,729 2,481 I 531 851 1,120 8,886 35,051 All other expenses n. s 21,528 110,957 ! 23,005 17,961 6,430 8,312 103,990 6,757 I 7,698 28,801 8,672 20,476 364,587 Total expenses j of operation.. 248,743 i 762,527 231,360 284,300 150,020 1116,215 412,052 165,217 129,632 189,872 134,354 289,857 3,114,149 Note issues: I Cost of Federal Reserve cur- i rency (including expressage, i insurance, etc.) 92,648 1 124,530 38,707 81,897 27,790 9,233 86,504 19,357 11,429 45,563 588,291 Miscellaneous charges account note issues (including taxes on Federal Reserve bank note circulation) 2,517 2,626 518 5,343 1,715 1,588 22,562 6,220 i 43,089 Depreciation charges: I Furniture and equipment 14,245 |. 159,221 48,766 5,954 3,423 5,741 5,953 273,739 Bank premises... 82,605 28,272 j 2,164 82,605 Remodeling bank building 50,155 ;. .1. 50,155 Total current I i 405,791 ; 887,057 561,893 417,480 | 208,708 j 128,130 503,899 192,243 146,072 263,738 140,940 296,077 ! 4,152,028 i Credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN, 703 Earnings and current expenses of each Federal Reserve Bank and of the system as a whole for the 6 months ending June 29, 1918—Continued. CURRENT EXPENSES—Continued. San Boston. Y N o e r w k. Ph p i h la i d a. el- C la le n v d e . - m R o ic n h d - . At t l a a . n- Chicago. Lo S u t. is. M ap i o n l n is e . - City. Dallas. F ci r s a c n o. - Total. Earnings in excess of current expenses... $790,198 $1,454,967 $917,711$511,250 $2,280,227$801,342 $510,333 $1,036,277 $604,304 $1,113,252 $20,698,162 Per cent of net earnings to calculated average paid-in capital (annual rate) 41.0 96.9 23.1 34.7 48.7 34.7 48.1 45.5 37.4 60.1 42.1 51.9 55.9 Dividends declared payable as of June 29 , 187,517' 586,271 367,157 452,561 112,973 88,084 284,002 293,294 81,529 201,795 169,065 362,198 3,186,446 Fiscal agent department disbursements of each Federal Reserve Bank, and amounts reimbursed for 6 months ending June 30, also balances reimbursable by the United States Treasury on July 1, 1918. Boston. Y N o e r w k. d P el h p i h la ia - . C la le n v d e . - m R o ic n h d - . A t tl a a . n- 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. Balance reimbursable Jan. 1,1918 $143,211 $360,350 $100,033 §139,248 $43,221 S45,694 $287,428 $124,849$54,127 $86,450 $65,005 $247,604 $1,697,220 Disbursements, Jan. 1 to June 30 495,413 1,717,350 405,015 524,310 193,624 299,882 1,068,361 448,501 182,626 300,137 237,925 551,958 6,425,102 Total 638,624 2,077,700 505,048 663,558 236,845 345,576 1,355,789 573,350 236,753 386,587 302,930 799,562 8,122,322 Amounts reimbursed by United States Treasury, Jan. 1 to June 30 209,441 658,827 96,353 133,640 72,476 19,197 400,809 171,076 100,361 116,290 33,651 182,885 2,195,006 Balance reimbursable July 1,1918 429,183 1,418,873 408,695 529,918 164,369 326,379 954,980 402,274 136,392 270,297 269,279 616,677 5,927,316 Cost of furniture and equipment, including vaults; iilso of bank premises. Boston. Y N o e r w k. Ph p i h la ia d . el- 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 ty sa . s Dallas. c F S i r s a a c n n o - . Total. Balance as reported Jan. 1,1918 §25 581 §9,065 §44,499 §29,501 §13,750 §11,000 §133,396 Additional purchases during 6 months ending June 29,1918 814,245 133,640 $48,766 28,272 §2,164 22,965 3,423 5,741 5,953 §12,182 277,351 Total 14,245 159,221 48,766 37,337 2,164 67,464 32,924 19,491 16,953 12,182 410,747 Depreciation charged during 6 months ending June 29,1918. 14,245 159,221 48,766 28,272 2,164 5,954 3,423 5,741 5,953 273,739 Amount recovered account previous expenditure for vault equipment,.. 2,500 2,500 Balance July 1, 1918 9 065 61,510 29,501 11,250 11,000 12,182 134,508 Bank premises July 1. 1918: . 250,000 600,000 312,979 206,966 136,736 395,193 1,901,874 Cost of Federal Reserve currency. Balance as reported Jan. 1,1918 $512 $588 $16,167 $12,915 $10,161 $40,343 Additional cost during 6 months ending June 29,1918... $92,648 $124,530 88,195 $81,897 $27,790 51,274 $170,324 43,146 32,580 $45,563 23,221 $83,569 864,737 Total 92,648 124,530 88,707 81,897 27,790 51,862 170,324 59,313 45,495 45,563 33,382 83,569 905,080 Cost of Federal Reserve currency charged to current expenses during 6 months ending June 29,1918 92,648 124,530 88,707 81,897 27,790 9,233 86,504 19,357 11,429 45,563 633 588,291 Balance July 1, 1918 42,629 83,820 39,956 34,066 32,749 83,569 316,789 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

704" FEDERAL- BESEKVE BULLETIN. AUGUST 1, 1918. Earnings and current expenses, by months, from January to June, 191.8. of each Federal Reserve Bank and for ike svstan as a whole. EARNINGS. San Boston. Y N o e r w k. Ph p i h la ia d . el- C la le n v d e . - m R o ic n h d - . la A n t t - a. Chicago. M ap i o fi l n is e . - 1 ! K C a i n ty s . as Dallas. F ci r s a c n o - . Total. " "I January 3229,863 |$1,33S,457 $191,710 8323,991 $161,076 $88,287 $435,984 1-3157,599$S7,962 i$184,296 S109,953$177,636 S3,480,814 February 320,215 1,324,642 175,229 26S,970 141,842 80,665 380,723 ! 126,773 82,443 ! 143,098 92,314 219,174 3,356,088 March..!! 276.920 ! 1,866,517 209,376 281,121 152,822 98,726 366,369 133,235 79,780 , 148,032 107,067 255,202 3.975.167 At>ril 274,298 ! 1,838,393 339,897 195,000 120,035 510,314 1189,521 109; 530 I 245,115 135,677 233,689 4,418.367 May 263,715 11,949; 913 256,525 330,207 226,812 123,881 544,357 1180,044 138,007 i 287,308 153,537 258,778 4,713,084 JUEO 323,463 |l,964,753 292,353 328,261 248,S67 127,786 546,379 1206,413 158,683 292,166 146,696 264,850 4,900,070 Total 1,688,474 10,282,675 1,352,091 1,872,447 1,126,419639,380 2,784,126 993,585 656,405 1,300,015 1745,244 1,409.329 |24,350,190 CURRENT EXPENSES. Janaarv ! 133,030 $161,060! $30,962 §63,628 $21,523 817,832 $51,281 :$28,236 i$21,829 I 841,816'819,517 $37,456 j $528,170 February 38,017 154,282i 41,460 59,966 28,292 ! 16,821 54,167 . 28,301 i 19,596 j 40,698 20,034 37.282 I 538,916 M-" arc"h ." 47,763 130,070I 42,992 66,183 40,671 i 19,869 65,471 | 33,221 ! 22,814 ! 45; 941 22,725 46,458 590,178 April 39,754 141,295• 38,567 77,965 40,006 ! 19,546 123,181 j 30,416 i 26,031 \ 37,401 23,532 47,620 615.314 May 41,376 139,873i 58,766 72,779 36,609 ! 18,177 89,769 ! 34,279 I 25,667 ! 50,775 23,333 65,987 057)300 June i 205,851 154,47711349,146 76,959 41,607 135,885 120,030 I 37,790 30,135 i 47,107 31)799 61,274 i,192.060 Total I 405,791 887,057 561,893 417,480 208,708 128,130 • 503,899 j192,243 146,072 | 263,738 140,940 \ 296,077 4,152,028 ' Increases shown for some of the banks for the month of June are due to special charges against current expense at closing of books on June 30, account cost of unissued Federal Reserve currency, depreciation of furniture and equipment, and bank premises; also in the case of the Boston ban\, remodeling banking quarters. Report of the Capital Issues Committee. At its meeting on January 14, 1918, the Board passed a resolution accepting this charge and appointed the under- The following report of the Capital Issues signed a committee and authorizing them to engage the Committee of the Federal Eeserve Board, dated necessary staff and to appoint an expert advisory committee to assist it in investigating and passing upon all July 17, 1918, has been presented to the Board: cases that might come before the committee, subject to To the FEDERAL RESERVE BOARD, the approval of the Board. Washington. The advisory committee appointed consisted of the SIRS: The undersigned, appointed by the Board, mem- following: Allen B. Forbes, chairman, senior partner of bers of its "Capital Issues Committee," beg to report as Harris, Forbes & Co., New York; Frederic H. Goff, presifollows: dent Cleveland Trust Co., Cleveland, Ohio; Henry 0. In his annual report to Congress, dated December 3, Flower, president Fidelity Trust Co., Kansas City, Mo.; 1917, the Secretary of the Treasury referred to the impor- Stephen L. Selden, executive secretary; James Q. Newtance at this time of avoiding unnecessary capital expend- ton, assistant executive secretary; Bradley W. Palmer, itures in both public and private enterprises. While no counsel; all of whom, in a spirit of patriotism, agreed to specific authority was conferred upon the Secretary to serve without compensation. W. T. Chapman was approve or disapprove new undertakings, a number of cor- appointed secretary of the Board's committee, to serve poration executives, bankers, and municipal officials, without compensation. inspired by the wish not to do anything which might in The advisory committee thereupon was authorized to any way retard the nation's efforts in the prosecution of engage offices in the National Metropolitan Bank Buildthe war, submitted to the Secretary plans for new enter- ing, Washington, where it proceeded to organize a staff prises and the Secretary invited persons intending to offer of paid employees. securities for sale or subscription to first submit them to Under date of January 24 the committee addressed a him so that he might express his opinion as to the com- letter to all Federal Reserve agents, inclosing draft of letpatibility of such issues with the public interest. The ter which would be sent to them upon organization of the number submitted grew so rapidly that, in a letter dated Advisory Committee. These letters, which announced January 11, 1918, Secretary McAdoo invited the Federal the policies adopted by the committee up to that time, Reserve Board "as another patriotic service to assume the instructed the agents, in consultation with the governors responsibility of passing upon such proposals as may be of their respective Federal Reserve Banks, to work out submitted to them in respect to capital expenditures or lists of names of persons suitable for the purpose of serving issues of new securities," and made public a statement to on an auxiliary committee of five (including the agent this effect, adding that "this is not alone a question of and the governor) to investigate such cases as might be capital, but of material and labor." referred to it from Washington, and to make recommend a- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AfGLST 1, 1918. FEDERAL RESERVE BULLETIN". 705 tions thereon; also lists of names of persons suitable for DISTRICT N"O. 8—ST. LOUIS. the purpose of serving as additional or substitute members Permanent committee.—W. McO. Martin, chairman; Rolia Wells, vice of the auxiliary committee in each district, such auxiliary chairman; F. O. Watts, W. K. Bixbee, W. R. Compton. Auxiliary committee.—N. A. McMillan, Fcstns, J. Wade, J. A. Omberg, committees to be composed of bankers, manufacturers, and S. T. Ballard, Emby L. Swearingon, Breckinridge' Jones, Wrilliam E. men of technical training commanding such skill and ex- Guy, W. L. Hemingway, Walker Hill, Benj. Gratz, M. S. Sonntag. perience as to qualify them in advising the Capital Issues DISTRICT NO. 9—MINNEAPOLIS. Committee at Washington with respect to applications Permanent committee.—John H. Rich, chairman; Theodore Wold, vice originating in their particular localities. The cases to be chairman; William A. Purst, Georgo I). Pay ton, J. L. Record. dealt with were expected to cover particularly State and Auxiliary committee.—George W. Burton, Sam Stephenson, John R. municipal issues and financing involving manufacturing Mitchell, C. B. Little, A. M. Marshall, Walter Butler, James MacNaughtoia, Tsaac Lincoln, F. A. ChamVerhin. or public utilities. From the names submitted the Capital Issues Committee appointed the following com- DISTRICT NO. 10—KANSAS CITY. mittees: Permanent committee—A so, E. Ramsav, chairman: J. Z. Miller, jr., DISTRICT NO. 1—BOSTON. vice chairman; Peter W. Goebel, II. P. Wright, F. P. Neal. Auxiliary committee.—O. C. Snyder, George S. Hovey, J. G. Schneider, Permanent committee—F. H. Curtiss, chairman; C. A. Morss, vice C. L. Davidson, J. R. Burrow, Luther Drake, R. C. Peters, A. IT. Marine, chairman; Robert Winsor, John E. Oldham, Francis R. Hart. John Evans, P. N. Fink, C. F. Colcord. Auxiliary committee.—Charles Francis Adams, Henry B. Day, Allen Curtis, Allan Forbes, Philip Cabot, James F. Jackson, Henry G. Bradley. DISTRICT NO. II—DALLAS. DISTRICT NO. 2—NEW YORK. Permanent committee.—-W. F. Ramsey, chairman; R. L. Van Zandt, vice chairman; Edward Gray, Howell E. Smith, W. C. Stripling. Permanent committee.—-Pierre Jay, chairman; "Benj. Strong, vice chair- Auxiliary committee.—Lewis Hancock, E. Rotan, P. E. Waggoner, E. man; Frederick Strauss, C. A. Stone, John R. Morron. R. T. Swaine, O. Tenison, John Sealy, W. R. Grim, J. 0. Terrell, R. D. Wilbor, John secretary. W. Poe, L. C. Schattuck. Auxiliary committee.—Thomas W. Laraont, George IS. Cortelyou, Harry Bronn or, Walter I*. Cooke, Charles V. Ritch, S. R. Bertron,Henry DISTRICT NO. 12—SAN FRANCISCO. R. Towne, Mortimer L. Sehiff, George Hardy, W. P. Graham, E. II. Permanent committee.—John Perrin, chairman; James K. Lynch, Outerbridge, Arthur Sinclair, jr., Edwin G. Merrill, Ohas. H. Sabin, vice chairman: I. W. Hellman, George K. Weeks, J. F. Sartori. A. H. "VViggin, Newcomb Oarlton, Wm. L. Saunders, Alvin W. Krech. Auxiliary committee—-M. F. Bakus, D. W. Twohy, II. J. McCiung, A. L. Mills, F. F. Johnson, Geo. A. ^atchelder, Ralph S. Stacy, L. H. DISTRICT NO. 3— PIIILADEF PHIA. Fnrnsworth. Permanent committee—R. L. Austin, chairman: C. J. Rhoads, vice All of the3e local committee members undertook to serve chairman; John Gribbel, A. A. Jackson, Clarence W. Clark. without compensation. Where requested, authority was Auxiliary committee.—John Newbold, L. Scott Townsend, John Brooks, George H. Frazier, Louis C. Lillie.. Thomas S. Gates, Tierdinand W. given local committees, however, to engage the services of Roebling, jr., H. B. Schooley, Howard S. Graham, Charles W. Welch, paid secretaries. E. P. Passmore, Benj. E. Mann, G. W. Reilly, C. C. Harrison, jr. In its letter of January 24 the committee stated that it was planned to operate on the same basis as that adopted DISTRICT NO. 4—CLEVELAND. by the English Capital Issues Committee; i. e., through Permanent committee.—-P. C. Wills, chairman: E. R. Faneher, vice voluntary cooperation of those having to do with the issue chairman; H. C. McEldowney, J. Arthur House, A. E. Adams. of securities, and stated that, at the outset, it would con- Auxiliary committee.—C. E. Sullivan, F. R. Huntington, C. N. Manning, Chas. W. Dupuis, E. H. Cady, C. B. Wright, Baird Mitchell, Wm. sider industrial and public utility issues of §5500,000 and M. Bell. over and municipal issues of $250,000 and over, adding DISTRICT NO. 5—RICHMOND. that the expression of this policy did not mean that the Permanent committee.—Caldwell Hardy, chairman; George J. Seay, committee did not earnestly invite the cooperation of all vice chairman; Frederic W. Scott, John M. Miller, Herbert W. Jackson. in reducing and eliminating issues of even smaller amounts Auxiliary committee.—Waldo Newcomer, F. H. Fries, John L. Dickinincompatible with the national interest. The committee son, B. H. Griswold, jr., S. T. Morgan, Geo. A. Holderness, John Joy Edson, Coleman Wortham, R. G. Rhett, John A. Law, E. E. Thompson. stated, however, that it hoped in due course to deal also with transactions of lesser scope. On February 22 the DISTRICT NO. '6—ATLANTA. limit on municipal issues was reduced from $250,000 to Permanent committee.—"til. B. Welborn, chairman; J. A. McCord, vice $100,000, it being found that in a great many districts the chairman; W. H. ICettig, Hollins Randolph, J. E. Zunts. majority of the municipal issues (and particularly those Auxiliary committee.—James E. Caldwoll, Edward W. Lane, W. H. that might well be postponed) were of amounts smaller Hassinger, Roby Robinson, F. E. Gunter, A. M. Baldwin, Otto M. than $250,000. On April 23 the minimum on industrial Marks. and public utility securities was reduced from $500,000 DISTRICT NO. 7—CHIC VGO, and over to $100,000 and over, in conformity with the Permanent committee.—W. A. Heath, chairman; J. B. McPougal, vice language of the then pending War Finance Corporation chairman; E. P. Hulhert, Rufus C. Pawes, Joy Morton. Wm. F. Mc- Lallen, secretary. Act. Auxiliary committee.—George Reynolds, Emory Clark, Oli%Ter C. Ful- The committee stated also, in its letter of January 24, ler, S. A. Fletcher, B. A. Eckert, Simon Casady, Louis E. Ferguson, that, in passing upon applications it would be guided by Caauncey Keep, E. J. Buflington, John J. Mitchell, B. E. Sunney, Lyman A. Walton. the following considerations only, viz: (1) Whether the 72715—18 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

706 FEDERAL RESERVE BULLETIN. AUGUST T, 1918. offer is timely with respect to the financial operations to be policy that, in passing upon issues for road construction or undertaken by the Government from time to time; and (2) for irrigation or drainage projects covering lands not therewhether the objects for which the funds are to be raised tofore under cultivation, favorable consideration should by the offer of securities are compatible with the public be given only to those of great economic or military iminterest; and added that it did not expect to pass upon portance and from which definite results were to be secured the issue of obligations having to run less than one year. in time to be of assistance in meeting the present emer- From time to time the committee addressed to the chair- gency. (In dealing with these cases, the committee acted men of all subcommittees letters expressing the policies in close touch with Mr. Logan Waller Page, of the Federal adopted by it. The main principles laid down were as Bureau of Public Roads, and Maj. Gen. Goethals, and the follows: committee desires to express its sincere appreciation of the The committee and the subcommittees were to be prompt, efficient, and courteous cooperation rendered to it guided in their deliberations by the thought that only by by these able gentlemen.) In this connection, the comsubordinating local and personal interests to the public mittee was represented at a conference held in Washington welfare and by the enforcement of the most rigid economy at which were present Mr. Page and members of the execuin matters of personal expenditure could the United tive committee of the American Association of State High- States hope to bear its part of the financial burden of the way officials, an official body whose membership is comwar and to release sufficient labor and materials for war posed of 48 State highway departments. A quick and purposes without depletion of our own resources. From loyal appreciation of the Nation's needs and of the necesthis point of view favorable action should be taken only sity for subordinating local benefits to national needs was where State, county, municipal, corporate, or individual shown by the representatives of the several States. financing involved projects which would contribute to the On February 8 the committee gave public hearing to successful prosecution of the war or which were essential representatives of the national organizations of the public to the public health and welfare. utilities companies of the country. These organizations The committee would consider favorably applications pledged their hearty support and cooperation with the submitted to it involving the refunding of maturing obli- work of the committee and assured it that, during the gations. period of the war, capital expenditures by them would be The committee would consider favorably applications limited strictly to the most imperative needs. This hearsubmitted to it involving the funding of capital expendi ing was followed by a conference on February 28 with the tures incurred prior to February 1, 1918; provided, how- war committee, representing the public service commisever, that the committee might deviate from this policy if sions of the several States. The purposes of the comavailable cash assets reasonably might be used for the pay- mittee were outlined to the commissioners, who stated ment of such debts in whole or in part or excessive cash that they had already accomplished a great deal along the distributions to shareholders were contemplated, or in same lines and expressed the heartiest desire to cooperate cases where the requirements of the corporation could be in every way possible to subserve the national interests met in some other manner without risk or hardship. The during the period of the war. committee stated that funding of banking indebtedness in- On February 28 a conference was held by the committee curred after February 1, 1918, for incompatible purposes and its advisory committee with the chairmen of the would not be permitted. The committee was particular various subcommittees. At this conference the local repto point out that what must be avoided was that those in- resentatives were carefully instructed as to the aims and tending to apply for permission to issue securities first objects of the committee and their questions fully anrunning into debt, conceivably for purposes not compatible swered. In opening the conference the chairman read with the public interest, and then asking for permission the following resolution adopted by the committee: to fund the banking indebtedness already incurred. This committee will not express an opinion, either of The committee adopted as a general basis for its conclu- approval or disapproval, in matters of new capital issues sions the policy that the sale of only such new securities below the minimum heretofore fixed, but will advise the ought to be considered favorably as would finance projects local subcommittees to discourage nonessential undertakings, irrespective of the amount, wherever practicable. likely to bring results within a year, stating that exceptions would be granted in cases where Government departments On March 19 a conference was held with Commissioner advised that, as a matter of military or economic protec- of Education Claxton and Lieut. Col. L. P. Avers, a memtion, work ought to be undertaken extending over a year, ber of the General Education Board, now acting as statistior where so much money had already been invested that cian for the General Staff of the United States Army, for the amount necessary to complete might be considered as the purpose of coordinating the policies of the committee irrelevant as compared with that already hazarded in the with those of the educational authorities, with a view to undertaking. developing a practical and at the same time scientific With respect to the question of road building and new method of dealing with applications involving the quesdevelopment of arable lands, so far as they were to be tion of the building of new schools and the possibility of financed by new bond issues, the committee adopted as its using temporary structures available or to be constructed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1.1918. FEDERAL RESERVE BULLETIN. 707 The result of this conference was an arrangement whereby when it was satisfactorily established that they were of Dr. J. A. €. Chandler, superintendent of schools of Rich- military importance, leading to camps, docks, or shipmond, Va., spent half of each week in Washington for the building plants or establishments producing materials purpose of advising the committee with respect to such necessary for the prosecution of the war, or whenever they issues. Dr. Chandler, whose work in this connection was were shown to be important from an agricultural standunder the supervision of Commissioner Claxton, had the point in order to open up agricultural districts or to make advice of Dr. George D. Strayer, of the faculty of Columbia their products available for ready distribution. In the University, New York, now serving on the War Savings case of hospitals the committee sought the advice of the Committee at Y/ashington, as well as that of Col. Ayers. Surgeon General as to whether or not new buildings were The Liberty loan campaign approaching, on April 4 the absolutely required and, if so, whether or not temporary committee adopted the following resolution: buildings could be used instead of permanent ones, as temporary buildings absorb less material, less labor, less Voted to recommend the postponement wherever possi m ble of the issue or public offering of securities of every transportation, and less money. Monumental buildings kind during the pending campaign for the Liberty loan, and parks or bridges merely involving greater comfort or this recommendation not applying to cases where securi- luxury were disapproved. In many instances the conties must be sold or offered to provide for maturities. In trollers of certain States and cities consulted with either case of issues already passed upon by the Capital Issues Committee but not as yet made or offered for sale, it is the central committee or the subcommittees of their hoped that such issues, wherever practicable, may also districts, discussing their budgets item by item, and be postponed and that the subcommittees will use their almost invariably these conferences resulted in the elimiinfluence to that end. nation of unnecessary expenditures and a substantial In a statement to the press on April 8, the committee reduction in the estimated appropriations. announced that, as the process of making capital available The committee applied the same broad principle of to the Government necessarily involved the creation of a compatibility to applications for the issue of securities to surplus of labor which, in turn, caused a period of unem- finance industrial and public utility enterprises. ployment during which labor disengaged from nonessential The committee adopted the following procedure with industry might be diverted to essential industry, the comrespect to the treatment of applications: Applicants were mittee had conferred with Mr. John B. Densmore, director instructed to make applications in duplicate, forwarding of the United States Employment Service, and Mr. Frank original direct to the committee at Washington and filing Morrison, secretary of the American Federation of Labor, duplicate with the subcommittee, as set forth in printed the result of this conference being the adoption of a plan instructions to applicants. When applications were reunder which the committee, before acting upon any appliceived or any other case presented for consideration or cation whose approval or disapproval would affect seriously action, the matter was referred in the first instance to the labor conditions, would seek the advice of the United advisory committee at Washington, which made the proper States Employment Service, whose successful efforts to preliminary investigation, in such manner as it deemed secure a scientific distribution of labor fitted to prevailing necessary, and presented its report and recommendation conditions were heartily supported by the American to the Board's committee at a joint meeting of the two Federation of Labor. committees. The Board's committee then voted as to the In dealing with States, municipalities, or counties, the action to be taken or required such further facts and in- Capital Issues Committee considered mainly expenditures formation, or further investigation, as appeared desirable. for the following purposes: Hospitals, schools, sewers, The decision in each case was made by the Board's comfiltration plants, municipal buildings, electric-lighjt plants, mittee, and a formal letter announcing such decision was roads, parks, and bridges. Wlien considering applica- signed by the chairman, or acting chairman, of the Board's tions of this character, the committee made it a rule to committee. The following were adopted as the formal seek advice from the Federal departments, boards, and letters to be written after consideration of applications: commissions having particular knowledge in the premises, for the purpose of determining whether or not the expendi- (Approval.) No. . (Date.) ture involved was essential for the successful prosecution Referring to the issue of - - by the of the war or for the health and necessary comfort of the After inquiry into the purpose of the issue above described, we are of people. Except when acting upon securities issued for opinion that the sale thereof is not incompatible with the interest of the the purpose of providing funds for the renewal of maturing United States. This finding constitutes no approval of such issue as regards its merits, obligations, only those cases that were found to be comsecurity, or legality in any respect. patible with the public interest, as above defined, received In any public offer of the said issues for investment by advertisement the approval of the committee. In reaching its conclusions or circular, and whenever reference is made to this opinion, it is requested it observed the broad principle that the use of capital, that the statement quoted below shall be incorporated in full. material, or labor could be justified only where results Yours, faithfully, CAPITAL ISSUES COMMITTEE OF THE could be expected within a very reasonable time. Thus, FEDERAL RESERVE BOARD, applications for roads were acted upon favorably only 13 v } Chair wan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

708 FEDERAL RESERVE BULLETIN, 1918. Passed as not incompatible with the interest of the United States, but In addition to this tangible result, it is safe to assume without approval of the merits, security, or legality. Opinion No. that the committee's very existence and the campaign of (Signed) Capital Issues Committee of the Federal Reserve Board. (If this issue is advertised, a copy of the advertisement should be sent education inaugurated by it have resulted in discouraging to the committee for its information.) at the source commitments for capital expenditures, (Disapproval.) thereby conserving material, labor, and credit for essential No. . (Date.) industries and the use of the Government. In spreading Referring to the issue of by the . We have had an investigation made of your proposal and have reached its gospel the committee was helped greatly by the willing the conclusion that the national interest will, in our judgment, best be cooperation of the public press. At the close of each week served if your operations were postponed until after the war. a statement was made public of the work accomplished The committee has asked me to express to you its sincere appreciation of the spirit in which you have submitted the matter for its opinion, and during the week, together with such additional facts and regret that, in view of the paramount necessity of conserving all financial comment as the committee felt would be helpful. A resources, as well as labor and materials, during the period of the war, its volume of these press statements is submitted herewith. finding could not be different. Yours, faithfully, Exhibit II, submitted herewith, is a volume containing CAPITAL ISSUES COMMITTEE OF THE the general letters and telegrams sent to subcommittees. FEDERAL RESERVE BOA.HI>, These communications contain the statements of policy By , Chairman. to be pursued and the general orders of the committee. The advisory committee held separate meetings, voting In asking to be discharged, the committee desires to thereat upon the recommendations to be made by it to the Board's committee. Minutes were kept of such meetings express its warm appreciation of the loyal support received and formed the basis of presentation and action at the joint from the American Bankers' Association; the Investment meetings of the two committees. Bankers' Association; the New York, Philadelphia, and Minutes of the joint meetings were kept by the secre- Chicago Stock Exchanges; the Boston Chamber of Comtary of the Board's committee, and. when approved by merce; and many other organizations which adopted resothat committee, they wen? submitted for the approval lutions in support of the committee's work and whose of the Federal Reserve Board. members pledged themselves not to deal in securities The rule was adopted for all committees that no member issued without the approval of the committee. The comshould take part in or vote upon any matter in which, mittee in order to succeed had to rely entirely upon voldirectly or indirectly, such member might personally be untary cooperation, and without this unreserved support interested, and that whenever any member felt that, for it could not have achieved adequate results. the above reason, he should not serve in dealing with a The committee's sincere appreciation is due to the particular case, he should so state and give opportunity advisory committee. The impartiality, patience, tact, for the appointment of a substitute to act in his stead. In and skill with which they availed themselves of this diffithe case of members of the advisory committee, a member cult task gained for them the confidence and good will of the Federal Reserve Board's committee was authorized even of those whose applications had to be refused. to act as such substitute; in the case of members of the The committee's thanks are due to the members of the Board's committee, another member of the Board was authorized to act as such substitute. local committee, and particularly to those who worked Forty-six meetings of the committee were held, at which upon the permanent committees of the several districts. some 361 applications, aggregating §478,458,386.10, were Their zest and devotion were of invaluable service to the disposed of, classified as follows: committee. A statement (marked "Exhibit IV") is attached, show- ! Municipal. u P t u il b i l t i v c . i Industrial. Total. ing the cost of the work done by the committee. Respectfully submitted. PAUL M. WARBURG, Amount considered.. $86,878,512 5172,069,605, $219,510,269 $478,458,386 Amoun t disapproved 19,791.665 6,000.000" 39,900,000000!! 65,691,665 C. S. HAMLIN, Aggregate ap- F. A. DELANO, proved 67,086.84: 166,069.605! 179,610,269! 412,766,721 Committee. Less " refunding " 21.392; 312 125,860.; 2841 111,411,900258,664,496 Aggregate now issues 45,694,534; 40,309,3211 68.198,369 154,102,224 Council of State Banking Associations. New issues last year, same period 108,952,865! 107,504.07o| 287,754,684 504,211,624 Analysis of newissues There was held in St. Louis, Mo., on July 15, approved: Amount original 1918, a meeting of representatives of State applications 65. -180,199! 46,209,321! 108,098,369219,793,889 A mo un t ap- : i banking associations, at which the following proved 45,694.534 40.209,32l| 68,198,369 154,102,224 resolutions were adopted: Curtailment effected 19, 79 L 665; 6,000,000 33,900,000 65,691,665 Analysis of applica- Whereas the extraordinary conditions through which tions informally the world is now passing has developed new problems and discouraged: Number 8! 17 greater responsibilities which must be met and solved by Amount 38,915,000. $7,360,000 $3,590,000 819,865,000 the bankers of the United States, and fully realizing that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, EEDEEAL RESERVE BULLETIN. 709 the welfare of the Nation can best be served by the fullest Whereas, in view of the fact that the American Bankers extension of both the National and State banks systems, Association has a membership of over 18,000, which is neither system conflicting with the other, but each coop- composed of 6,141 national banks, 8,251 State banks, erating with and assisting the other in financing the war, 1,605 trust companies, 1,461 savings banks, to say nothing in developing our natural resources, and in extending our of the private banks of which number the information is commerce; therefore be it not at hand, making over 11,000, or over 65 per cent of its Resolved by the representatives of State banks, trust membership which are not national banks; and companies, and private banks in association assembled in Whereas it has a savings bank section, a trust company the city of St. Louis, Mo., on July 15. .I9i8, as follows: section, a state bank section, a national bank section, and (1) That we approve the call for this meeting, which was a State secretaries' section; and made by the supervisors of State banks and trust com- Whereas through its educational department, its propanies. tective department, its legislative committees, and other (2) That we recommend that State banks, trust com- subordinate organizations, it is able to. and does fairly panies, private banks, and savings banks, located in the represent the banking interests of the United States, thereseveral States, form a State organization for the purpose of fore, it can be and is an agency through which every bank conserving and protecting those local privileges and in- may have full and free expression and outlet for its activiterests which have been developed and become inherent ties; and in State financial institutions; and for the further purpose Whereas it is the imperative duty and first obligation of securing such legislation as may be necessary to perfect of every financial institution to do its full part for the the State banking systems. Government at all times, particularly during the war, in (3) We recommend that such State bank sections of assisting the Government in all financial matters; and organizations cooperate with existing State bank organiza- Whereas this can be accomplished much better through tions in so far as their interests do not conflict. an organization representing all financial institutions of (4) It is not the purpose of this association to oppose or the country, regardless whether they be national banks or in any way antagonize the Federal Reserve system as at otherwise: Therefore be it present constituted, but it is our desire to aid and assist Resolved, That a new organization would lessen the the Federal lleserve Board in every way possible for the efficiency of the banks of the country as a whole and that promotion of safe and sound banking. a new association is unnecessary and unwise at this time. (5) That this council cooperate with the American As a result of the meeting there was created a Bankers' Association and the bankers' associations of the United States Council of State Banking Assoseveral States in all matters affecting banking interests, ciations with the following officers: and it is not our purpose to withdraw in any way support from either of said associations. W. H. Booth, president, Los Angeles, Gal. (6) That we renew and redeclare our allegiance to Wm. Macferran, vice president, Topeka, Kans. Woodrow Wilson, the Commander in Chief of our Army Geo. W. Rogers, vice president, Little Rock, Ark. and Navy. We pledge "all that we are and all that we F. H. Sisson, secretary, New York. have" to a victorious termination of the great conflict Wm. B. Boulton, treasurer, Morristown, N. J. between medieval autocracy and the free people of the world. In our organized capacity we stand ready to EXECUTIVE COMMITTEE. respond in the future as State banks have responded in First district.—Albert O. Brown, Manchester, N. H. the past to every call made by our Government for either Second district.—Charles H. Sabin, president Guaranty moral support or financial aid. Trust Co., of New York. (7) That the secretary of this association be, and he is, Third district.—George II. Earle, jr., president Finance directed to forward a copy of these resolutions to the Co. of Philadelphia, Pa. President of the United States and to the Secretary of the Fourth district.—Malcolm McGiffin, president Fidelity Treasury; also a copy to the president of the American Title & Trust Co., Pittsburgh, Pa, Bankers' Association and to the president of the several Fifth district.—Emory L. Coblentz, president Central State banking associations and to the chairmen of the Trust Co., Frederick, Md. Federal Reserve Board. Sixth district.—Forrect Lake, president Seminole County The following resolution was presented and Bank, Sanford, Fla. voted down, eight States voting in favor of it, Seventh district.—II. A. Moehlenpah, Clinton, Wis. Eighth district.—Chas. C. McCain, vice president and secincluding Ohio. Illinois, Michigan, Wisconsin, retary Bankers Trust Co., Little Rock, Ark. Missouri, Texas, and Tennessee. Twenty- Ninth district.—George G. Johnson, vice president First two States voted in oppositior t o it. &§| & Peoples State Bank, Thief River Falls, Minn. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

710 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. Tenth district.—Ohas. L. Engle, president Commercial ARTICLE IV. Bank, El Reno, Okla. SECTION 1. All powers necessary for the government of Eleventh district.—Travis Oliver, vice president Central the council shall be vested in an executive committee, Savings Bank & Trust Co., Monroe, La. which shall be composed of 12 members, elected from rep- Twelfth district.—John S. Drum, president Savings Union resentatives from each Federal Reserve district. Each Bank & Trust Co., San Francisco, Cal. representative shall be elected by the representatives from Articles of association of the council were the associations located in his Federal Reserve district. adopted as follows: SEC. 2. The executive committee shall have general charge of the business of the council and the disbursement of its funds. It shall arrange for the meetings of the coun- ARTICLES OP ASSOCIATION OF THE UNITED STATES COUNCIL cil, select subjects for discussion, and at each annual meet- OF STATE BANKING ASSOCIATIONS. ing shall render a report covering its official acts, and sub- ARTICLE I. mit such business as may require attention. The executive committee may employ an executive SECTION I. This organization shall be called the United secretary and such other assistants as they deem necessary. States Council of State Banking Associations. Any seven members of the executive committee shall SEC. 2. The objects of this organization shall be to pro- constitute a quorum for the transaction of business. The mote the general efficiency and welfare of the American executive committee shall have the power to fill, for the banking system, to obtain cooperation between States unexpired term, any vacancy which may occur either in and with the National Government in securing sound, uni- their own body or in the board of officers. form, and constructive legislation, both State and National, SEC. 3. Each member of the executive committee shall and to bring about a general strengthening of the banking, serve for the term for which he shall have been elected and financial, and general economic condition of the Nation. until the election of his successor. Four members of the first executive committee shall be ARTICLE II. elected to hold office for one year, four for two years, and four for three years. At the expiration of the first year SECTION 1. Any association of State banking institutions and each year thereafter four members shall be elected shall be entitled to membership in this council on applica- and shall serve for three years. tion of the Secretary and approval by the executive com- After each annual election the executive committee mittee . shall meet for the purpose of election of officers and the SEC. 2. For each class of State banking institutions reptransaction of other business, at such time and place as resented each State may be represented by one delegate, they may appoint or as may be fixed by the members of not exceeding three in all. the council. SEC. 3. In any State where no organization of State bank- SEC. 4. The executive committee shall meet in session ing institutions exist a section of a State banking associafor organization and other duties within 24 hours after the tion representing State institutions only may be entitled final adjournment of the annual meeting. to membership in this council on the same basis as outlined SEC. 5. Other meetings of the executive committee shall in section 2. be held on the request of three of its members or by direc- SEC. 4. Every member of this council shall be entitled tion of the president. to be represented at each of its meetings by one to three Notice of the time and place of each meeting and of the delegates or alternates who shall vote in person, not by business to be transacted thereat shall be given t« the proxy. members of the executive committee by delivering or SEC. 5. Voting at any meeting of the council shall be mailing a copy of such notice to all the members at least viva voce, unless a majority of the members represented at two weeks prior to the meeting. such meeting shall by vote otherwise direct, in which SEC. 6. Provision shall be made from the funds of the event it shall be by ballot, each member present being council to meet the necessary expenses of the members entitled to but one vote. of the executive committee in attending meetings. SEC. 7. The executive committee shall have authority ARTICLE III. to create a bureau of State and Federal legislation and to SECTION 1. The officers of ibis council shall consist of a appoint the members thereof, and shall likewise have president, one or more vice presidents, a secretary and a authority to terminate the existence of such bureau and treasurer, all of whom shall be elected by ballot by the to remove any member thereof. Such bureau shall conmembers of the council at an annual or special meeting, | pist of smch number of members as may seem to them and shall hold office for one year and until their successors ! proper, and the general council shall be one of said membe chosen. All officers must be chasen from members of bers. The members of the bureau shall receive such State banking associations represented in this council. compensation as may be fixed by the executive committee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL EESERVE BULLETIN. 711 The bureau shall be empowered to provide suitable treasurer. The basis of this assessment shall be the quarters for itself at such place or places as may be needed relative banking resources of the State institutions repreand to employ all necessary assistants and too fix their sented by the member associations. compensation, and do all things required to carry out the The fiscal year of the council shall end June 30 of each purpose of its existence, subject at all times to the Sirec- year. tion and approval of the executive committee. All such It shall be the duties of the executive committee to expenses so incurred shall be borne by the association. prepare a budget of estimated expenses for the succeeding The bureau shall perform such duties and render such year to be submitted at each annual meeting of the council, services as the executive committee or the association together with the basis of assessment to provide funds may from time to time direct. therefor. ARTICLE VIII. ARTICLE V. At each annual meeting of the council a nominating SECTION 1. The president shall preside at all meetings of committee of 12 members, including 1 from each Federal the council and of the executive committee and appoint all Reserve district, shall be elected by the delegates. This committees, with the approval of the executive committee, committee shall report at the next annual meeting of the and have general charge of the interests of the council and council a list of nominations for the officers of the council, ex officio be a member of all committees. and expiring memberships of the executive committee. In case of the absence or disability of the president, all his powers and duties may be discharged by a vice ARTICLE IX. president. In case of the absence or disability of the president, These articles of association may be amended by the and all vice presidents, the executive committee may affirmative vote of two-thirds of the delegates present designate one of its own number to act as president pro at any annual or special meeting. tempore. SEC. 2. The secretary shall have charge of the records and correspondence of the executive committee and Financing of Grain.1 council and discharge such other duties as may be assigned topiim by the executive committee. Some months ago, acting under the direction SEC. 3. The treasurer shall receive and disburse all of the President, the Federal Trade Commismoneys under the direction of the executive committee, sion, in connection with the Department of and shall prepare and submit a statement of the financial condition of the council at such times and in such manner Agriculture, began a general food investigaas the executive committee may require. No payments tion. This work was ultimately subdivided shall be made by the treasurer without the written ap- into several investigations, one of which was proval of the president, a vice president, or secretary. grain exchanges and marketing, In the early ARTICLE VI. stages of this last investigation it appeared that there existed considerable differences as SECTION 1. The annual meetings of the council shall be held at such times and places as may be designated by the between different sections of the country in the executive committee. methods of financing the grain trade, and it Special meetings of the council may be called at such therefore became necessary to attempt some times and places as the executive committee may direct. study of these differences as well as to ascertain Notice of the time and place of each special meeting, the scope, character, and methods of financing and of the business to be transacted thereat, shall be given to the members of the council by delivering or mailing'a the grain crop. The work which is being and copy of such notice to all the members at least two weeks has been done along this line may roughly be prior to the meeting. subdivided into two parts: (1) Interviewing, At least one month's notice of regular meetings shall be and (2) statistical information. given to all the menfbers of the council. (1) In the first place, the field men on the ARTICLE VII. exchange and marketing investigation were SECTION 1. The expenses of the council shall be pro- given specific instructions to obtain in their vided for by annual dues imposed upon each member of interviewing work all possible general informathe council. tion in regard to grain crop financing. Infor- SEC. 2. The annual dues of the council as fixed by the executive committee shall be payable upon call from the i Furnished by the Federal Tr ade Commission. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

712 FEDERAL RESERVE BULLETIN. AUGUST 1, mation of this character, however, is necessa- houses. This schedule either has gone out, or rily very general, and it was considered neces- will go out, to the great bulk of the banks and sary to supplement this by obtaining detailed banking houses in each terminal market menstatistical information with reference to this tioned above which are engaged in financing the subject. grain trade. It requests the return by months (2) The statistical returns requested by the for the years 1913-1917 of loans made by each commission may roughly be divided into three bank or banking house to the grain trade: sections: (a) Based on bills of lading; (A) Information from country eleva- (&) Based on warehouse receipts; tors. (c) Based on other collateral; (5) Information from terminal market (d) Unsecured, and concerns engaged in the grain (e) Total. trade. With these there are combined a set of ques- (0) Information from banks. tions which with some changes, applicable to (A) The commission has already sent out to particular markets, are as follows: country elevators seA^erai thousand schedules, (1) Number of regular grain firm custoand several thousand more will shortly be sent mers at close of each year 1913out. These schedules ask for the amounts 1917. owed at the end of each quarter for the crop (2) Number of customers that were years 1913-14 and 1916-17, together with granted unsecured loans in each the maximum and minimum outstanding year 1913-1917. during each year and the sources of such (3) Number of local grain concerns reborrowed funds. In addition, the country ele- ceiving loans who are not regular vators are requested to specify the maximum depositors together with the charamounts owed on open accounts to farmers for acter of the loans. grain delivered during each crop year 1913- (4) Minimum ratio of average deposit 1917. balance to loans required by bank (B) Schedules have either been, or shortly and whether this applies both to will be, sent out by the investigation to all collateral and unsecured loans. concerns engaged in the grain business in the (5) Maximum single secured and unsefollowing cities: Chicago, Minneapolis, Duluth, cured loans in each of the last Milwaukee, Kansas City, Omaha, St. Louis, five years. Peoria, Indianapolis, Cincinnati, Louisville, (6) Does the bank buy grain paper New York, Buffalo, and Philadelphia. through brokers together with the These schedules vary considerably in general amount bought in each of the last content, depending upon the size of the mar- five years ? ket. Similarly the questions asked with refer- (7) Does the bank have a regular scale ence to the financing of grain show considerable of collection charges on bill of variations. The minimum, however, which is lading drafts applying to all grain required from each concern in any of the mar- customers together with the scale kets is the maximum amount of money bor- of charges ? rowed in each year from 1913-1917 together (8) Does the bank accept warehouse rewith the names of the principal lenders of such ceipts as collateral for all grain funds. customers, and if so, to what (C) Necessarily the most important infor- amount of their face value? mation for the study of grain financing is con- When the full returns to the bank schedule tained in the schedule for banks and banking and the questions on financing contained in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 713 the other schedules mentioned have been re- mendations at that time. A committee of ceived by the commission, they will be com- nine—composed of three cotton shippers, bined and consolidated and analyzed in the three manufacturers, and three bankers—was, light of the general information gathered by however, appointed to consider the problem the field force with reference to financing. carefully and report at a later meeting. This Although it may be necessary, as a result of committee consisted of the following: this analysis, to seek for some further explana- Cotton manufacturers—Randall N. Durfee, tion of certain phenomena either from the Fall River, Mass.; Charles B. Luther, Fall banks or concerns engaged in the grain trade, River, Mass.; Charles T. Plunkett, Adams, since it is impossible to forecast, or determine, Mass. in advance what the figures requested will Shippers—Bernie L. Anderson, Fort Worth, show, it is believed that the schedule returns Tex.; Joseph Newburger, Memphis, Term.; combined with the information obtained by Charles L. Tarver, Dallas, Tex. the field force will permit a comprehensive Bankers—Hon. Theodore E. Burton, New discussion of grain financing without request- York; J. E. Bouden, New York; E. L. Rice, ing further information. Practically all the Memphis, Tenn. banks and the banking houses have shown a After thorough study and many conferences most cooperative spirit and have greatly fa- with the interests which they represented, the cilitated the investigation by promptly sending committee held a meeting at New York on in returns, as requested. It is hoped that the June 8, at which Governor Harding was also results of this study will be of value not only present. In the discussion of the various to the grain trade but also to the banks financ- phases of the question, the chief difficulty ing such trade. which developed was due to the fear of Southern interests that banks in that section would be unable, after financing the crop until the Acceptances in Cotton Financing.1 harvest, to carry it on acceptances. It was pointed out, however, that there is a constant The use of both bank and trade acceptances demand for this class of paper and that a quanpromises to be an important factor in financing tity of it in the portfolio of a bank would the 1918 cotton crop. This is due largely to strengthen rather than weaken the instituthe efforts of The National Association of Cottion's financial position. The meeting realized ton Manufacturers, under whose auspices a that it would be impossible to make any hard conference of cotton manufacturers, shippers, and fast rule governing the financing of cotand bankers was held at New York on May 3. ton, but it was felt that acceptances should be The Federal Reserve Board was represented used whenever practicable, in order that the at this meeting by Governor Harding, who, in credit transactions involved could be as the principal address, highly recommended the widely and as easily distributed as possible. use of acceptances as a means of easing the With this feeling the following resolution was strain put upon the bankers of the country passed: during the crop-moving period. At the meeting, which was largely attended, the use of Resolved, That this committee recommends that, in acceptances in its relations to each factor in- connection with present methods, bank and trade accepterested in raw cotton marketing was fully dis- tances be employed, so far as practicable, by shippers and spinners in financing this season's cotton crop. cussed, but because of the importance of the problem and the many points involved, it was In connection with this movement for the thought unwise to make any definite recom- increased use of acceptances, the recent proposal of the National Association of Cotton 1 Furnished by Mr. Rufus R,. Wilson, secretary National Association Manufacturers that a chain of cotton wareof Cotton Manufacturers. 72715—18 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

714 FEDEEAL BESEBVE BULLETIN. AUGUST 3, 1918. houses, to be established at both northern [Sixty-fifth Congress, second session. H. R. 21283. in tli(> House of Representatives. July 3, 1915?. Ordered io be printed with the and southern points, and conducted under the amend in cuts of the Senate numbered.] direct supervision of the Secretary of Agricul- AN ACT To amend and reenact sections four, eleven, sixteen, nineture, is of particular interest. Such warehouses teen, and twenty-two of the Act approved December twenty-third, would not only greatly ease the strain nineteen hundred and thirteen, and known as the Federal reserve Act, and sections fifty-two hundred and eight and fifty-two hundred usually put on transportation facilities dur- and nine, Revised Statutes. ing the period of winter congestion, but Be it enacted by the Senate and House of Representawould issue receipts guaranteeing weights, tives of the United Stales of America in Congress assembled, and grades, which would furnish the very best (i) ¥feftt—seetiea four of-^fek-e-Aefe-a^^evod Do collateral to aid in the financing of the crop. ^•-a-H4-4Mi:tee±i7-feftews- , bo- Such receipts, if attached to trade accep- ^ tances, would immediately put them into the highest class of commercial paper regardless of s -ef -Gksa-A the financial standing of the drawers and acceptors. This would not only remove the main difficulty raised at the New York meeting, but would tend to stabilize the price of e4asst^ cotton, an end which is very desirable from all district • standpoints. shall coBrfcaaa-as-seaEly The importance of this movement can be hardly overestimated. In 1916 the cotton 7 crop was worth over a billion and a quarter dollars—with the exception of corn, our most -of valuable crop. The 1917 crop was worth nearer two billion dollars. That portion of the crop consumed in this country has been sold for cash to the spinners, who have had to finance their purchases by the use of ordinary «ttps-ftHt€-flfesktt-4HffiEBftit-eiae-4iet-4e commercial paper. Whatever proportion of ea-ek-ele-etor in-ea the huge amount involved can be put into ac- nom ceptances will be a distinct aid to our credit system, and should be encouraged by the by banking interests of the country. by the Amendments to the Federal Reserve Act. In order to furnish an accurate reply to many questions as to the present status of legislation designed for the amendment of the Federal f^^ "Reserve Act, there is presented herewith the ^ bill now pending in conference committee both as passed by the House and by the Senate. The lines crossed out represent the bill as passed by the House and amended by the Senate. The House rejected the Senate amendments, and the bill is now in conference. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 715 ^ieG to tli-e-eame 4i^ ^^ ^ ^ ^ ee€^4^ of tlic Damo gre^—a3 the rer tho protce{aea-8f private or ^ the-bank Iia¥i-Hg44i4€ a¥gesi3-aggfg€ a:te-^S€ 8-H:jee€a of any H-5-H3kal3T^ or mafee an-afMa^k, thG-pgecddcnt, Yi k national bank 8fB^ € ouch Stat-o •au:fe8rig€ or ¥e^;^a¥s,' or may-be ^ w^ U •r-^faat-e3?-3?ei;isee-4fi.e--a^p3ieatien ba.Ekiiig^B6©eia^4oR-ka¥^g^"e«f/i^i-a3^-s^^ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

716 FEDERAL RESERVE BULLETIN. AUGUST 1, J918. by Stato guilty oJ-aHffi-iedornoaiior aftd-ekall be imprioonod not ox -kanko, truot companioa, • and cxcrcioing oueli powers." and may be equal to the money oo £2J Seer-Sr That the ninth paragraph of section sixteen Ioanc4-o¥-gratuity-gi von. of the Federal reserve Act, as amended by the Acts ap- Any examiner accepting a loan or gratuity from any proved September seventh, nineteen hundred and six- bank examined by him or from aa-ofneor, director, or emteen, and June twenty-first, nineteen hundred and seventeen, be further amended and reenacted so as to read as yoa? or fiae4-aet-inoro thai* follows: "In order to furnish suitable notes for circulation as Federal reserve notes, the Comptroller of the Currency shall, under the direction of the Secretary of the Treasury, cause plates and dies to be engraved in the best manner to guard against counterfeits and fraudulent alterations, and shall have printed therefrom and numbered such quantities of such notes of the denominations of S5, $10, $20, $50, |100, $500, $1,000, §5,000, $10,000 as may be required to supply the Federal reserve banks. Such notes shall be in form and tenor as directed by the Secretary of the Treasury under the provisions of this Act the Compfayelleg-ej-tbe—GKffroncy7-ejpand shall bear the distinctive numbers of the several diroctora Federal reserve banks through which they are issued." (3)SEC. 1. ¥hafr paragraph3 (b) aad-(e)-9f-section nine . »ea-ef tho Federal rcaorvo Act, aa amoaded by tho Ada any approved August fifteenth, ninotoon Iraadrod and four Any baak examiner vietemg the pfoviaiona of-^ie ninotooa hun.4fet€-aB-d ouboootion ahall-be impriaonodr-aet more then one ycar-ef frcon, in a rooorvo city, as now og-kereaftcr defined? "(c) Excep-fe-ae horoia provided, any-oificcr. diroetoiv it ahalr-hold and maintain with the Federal rooorvo bank employee, or attoraeyef* ita district an actual net balance equal to not IOBB than ten por centum of tho aggregate amount of ita domand miaaion, gif%-03e-fehmg-el-¥altte-4f€) y pcroon^nrm, or dopoaita aad throe por centum of ito timo dopoaita: Pro corporation, for procuring or endeavoring to procure for mded, however, That if located in tho outlying diatricta ofaueh pcraon, firm, or corporation, or for any other pcrooBy a roaorvo city or in territory added to auch a city by the firm, orcoirffofa&on, aay4eaa4geaT-or-tho extonaion of ita corporate charter, it may, upon the affirm unt of anyy ppapp,e r, aeteyydraft, elteek., or bill of oxehanggo ativo voto-ef-&¥e membora oMke-Fodcral Rcoorvc Board? by aauueehh mmeemmbbeerr bbaannkk sshhaall be deemed g g uuy iillttyy ooff aa mmiissddee-hold and maintain the rcaorvo balances apecined in para meanor and ahall be impriaoncd not more than one or fined not gf a-pfce(a)-h or oof. '' (d) Any member bank may-contraet for If in a central rcocrvo city, aa new or horoaftog-defrom, any of ita dircctorB-eg-&om any firm of it ohall hold and maintain bank of ita dioteict an actual not balance equal to net-less gfes-djgectoro ia a bor^-anyy accuritica or other p p y^ than thirteen per centum of tho aggregate amount of ita when (and not othorwiao)-auch p=arehaoc io made in the regulaf-eouroc of buaincaa upon, tcrma not leno favorable to demand otopoaita and throe per centum-of ito time depoaita: the bank than thooo offc3?ed to othcro, or vrhen sttea-pm^ Provided, however, That if looatoA-in thc-outlying diatricta chaao ia authoriacd by-a majority of the bea^d of director ef-a central rcaor^e city or in-toritery-added^e such-ej&y not intorootod i e aale of Buea-eeouritioo or by the oxtonoion of ita cooperate charter, it may, upon the p py tho e evidenced affirmative vote of five mombera of the Federal Roaorvo aueh authorityy to be evidenced byy tho affirmativc-^o-te-e? Beard, holeVaad maintain the rcaorvc balancca apecified written aaaont of 3uch dircefeefa: Provided, however, hen any thereof/' y ^y SEO. 5. That ooetion twenty two of the Federal Rooorvo b p c roo r, pp a ee c rrtt t y in g to for or on b e e r h a b l a f n o k f , o t t h h e o ra F , e a d o e ll r s a -D l C R C o u a r o it r ic v a o or other Aoty aa amended-ky the Act-ef June twenty firat, nineteen by regulation may, in any or all-caseey-rcquiro a full-di hundred and oovontoon, be further amended and r con acted cloo33uurroo ttoo bboo mmaadedre-ea-feifflfWHfco be to read aa fellows "(a) No member bank and dirccto evor auch dircctof-er firm, aefemg-m-his-er-ite-o ployoo-thoroof-gkall-horcaftor make any loan-er grant any sella socuritica or other property to tho bank tho Federal gratuity te-any bank examiner. Aay-kaak-officcr-, dircc- Rooorvo Board,' by regulation, may geqairo a tei?7-er employee violating thie-^reviaion oltaM be deemed eloouro of aHr^pefit roalizod-from ouoh sale-r Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 3,1918. FEDERAL RESERVE BULLETIN. 717 "Any member bank may scH-Beemtica og-othor Statutes, and shall, in the discretion of the Federal Rety to aay of its directors, eg-to-a-fern of whieh any of ita serve Board, subject any other member bank to the penddrcctor-e-io a, member, in the roo of bttsmooB o alties imposed by section nine of said Federal reserve Act terina not more-Eft-vorablo to such director or- firm than these for the violation of any of the provisions of said Act. Any effcrod to e&tegSj-eg- when ouch sale is authorized by a officer, director, agent, or employee of any Federal reserve majority oi thc4>eaf4-ef-direetoe-ef-a^)enibe¥4»ftftk to be bank or member bank who shall willfully violate the providonoed: by their affirmative vete— assoafe visions of this section, or who shall resort to any device, •P-rovidhd^-kowcvcr, That nothing in this subsection con-or receive any fictitious obligation, directly or collaterally, fined shall be coaotrucd as authogHHRg member banko to in order to evade the provisions thereof, or who shall certify ettabfeies or othor-ffrepcrty which 3uek a check before the amount thereof shall have been regubanko arc Rot otherwise-authorized by law to purchase larly entered to the credit of the drawer upon the books of the bank, shall be deemed guilty of a misdemeanor and No member bank shall-pay to anL;V director, officer, shall, on conviction thereof in any district court of the attorney, or-employee-a-grcatcr rate-eJ-E on thc-de United States, be fined not more than $5,000, or shall be popssiittss o0f1 ssuueefftt--efeBereeteotor,r , oofffficiceerr, , aattttoorrnneeyy, , oorr eemmpploloyyeeee tthnaann imprisoned for not more than five years, or both, in the frat paid-to othcr-c4epositora on similar deposits with such discretion of the court. tembor bank. "SEC. 5209. Any officer, director, agent, or employee of 10 diroctora or officers oi' any member bank shall any Federal Reserve Bank, or of anyinember bank as defined knowingly violate or permit may of the agents, officers, in the Act of Tecember twenty-third, nineteen hundred er divectoi-G of any member-bank to violate any of the pre and thirteen, known as the Federal Reserve Act, who emvioiono oi' this soetion or regulations of the board made bezzles, abstracts, or willfully misapplies any of the monundor author&y-feheroof, every dircetor and-officcr partici eys, funds, or credits of such Federal reserve bank or y or aBBontHtg^e-Buch-^elatieBr-shaH-be-faeld: liable member bank, or who, without authority from the direcin hia for all damages tors of such Federal reserve bank or member bank, issues which the member bank, its shareholders, or any other or puts in circulation any of the notes of such Federal repegsefts—ftkftll—-httvc sustained in consequence of such serve bank or member bank, or who, without such authority, issues or puts forth any certificate of deposit, draws SEC.[4J?- 2. That section fifty-two hundred and eight any order or bill of exchange, makes any acceptance, of the .Revised Statutes as amended by the Act of July assigns any note, bond, draft, bill of exchange, mortgage, twelfth; eighteen hundred and eighty-two, and section judgment, or decree, or who makes any false entry in any fifty-two hundred and nine of the lie vised Statutes as book, report, or statement of such Federal reserve bank or amended by the Acts of April sixth, eighteen hundred member bank, with intent in any case to injure or defraud, and sixty-nine, and July eighth, eighteen hundred and such Federal reserve bank or member bank, or any other seventy, be, and the same are hereby, amended [5J a-ad company, body politic or corporate, or any individual a€re4 to read as follows: person, or to deceive any officer of such Federal reserve "SEC. 5208. It shall bo unlawful for any officer, di- bank or member bank, or the Comptroller of the Currency, rector, agent, or employee of any Federal reserve bank, or any agent or examiner appointed to examine the affairs or of any member bank as defined in the Act of December of such Federal reserve bank or member bank, or the Fedtwenty-third, nineteen hundred and thirteen, known as oral Reserve Board; and every receiver of a national bankthe Federal reserve Act. to certify any check drawn upon ing association who, with like intent to defraud or injure, such Federal reserve bank or member bank unless the embezzles, abstracts, purloins, or willfully misapplies any person, firm, or corporation drawing the check has on of the moneys, funds, or assets of his trust, and every perdeposit with such Federal reserve bank or member bank, son who, with like intent, aids or abets any officer, direcat the times such check is certified, an amount of money tor, agent, employee, or receiver in any violation of this not, less than the amount specified in such check. Any section shall be deemed guilty of a misdemeanor, and check so.certified by a duly authorized officer, director, upon conviction thereof in any district court of the United agent, or employee shall be a good and valid obligation States shall be fined not more than $5,000 or shall be imagainst such Federal reserve bank or member bank; but prisoned for not more than five years, or both, in the disthe act of any officer, director, agent, or employee of any cretion of the court. such Federal reserve bank or member bank in violation "Any Federal reserve agent, or any agent or employee of this section shall, in the discretion of the Federal Re- of such Federal reserve agent, or of the Federal Reserve serve Board, subject such Federal reserve bank to the Board, who embezzles, abstracts, or willfully misapplies penalties imposed by section eleven, subsection (h). of any moneys, funds, or securities intrusted to his care, or the Federal reserve Act, and shall subject such member without complying with or in violation of the provisions bank if a national bank to the liabilities and proceedings of the Federal reserve Act, issues or puts in circulation any on the part of the Comptroller of the Currency provided .Federal reserve notes shall be guilty of a misdemeanor and for in section fifty-two hundred and thirty-four, Revised J upon conviction in any district court of the United States Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

718 .FEDERAL BESEBVE BULLETIN. AUGUST 1,1018. shall be lined not more tli.au §5,000 or imprisoned for not The relation between the bank and the more than five years, or both, in the discretion of the farmer should be such as to insure that the court." system of farming promoted by the loan shall Amend the title so as to read as follows: "An Act to be as safe and as certain of profitable results amend the ninth paragraph of section sixteen of the Federal reserve Act, as amended by the Acts approved Sep- as human foresight can make it. It is highly tember seventh, nineteen hundred and sixteen, and June important therefore that the farmer and the twenty-first, nineteen hundred and seventeen, and to bank be guided in their agreement by fundaamend sections fifty-two hundred and eight and fifty-two mental principles of safe and profitable farming. hundred and nine, Revised Statutes." The system of farming promoted is an exceed- Passed the House of llepresentatives April 24. 1918. ingly important feature of the loan contract. Passed the Senate with amendments July 2, 1918. A safe cropping system is necessary for the farmer in order that he may remove as far as The Relation of Farm Credit Statement to Short Time Bank Credit for Farmers.1 circumstances permit the danger of foreclosure and loss of any capital and equipment The credit needs of agriculture have too he already possesses, and also that he may frequently been neglected by the banks in the avoid the lesser evil of unnecessary extensions past. As a class, however, banks have recently of the loan. Such foreclosures, as well as begun to take a more general interest in the extensions on a depreciated security, are unfarmer. The banker has every reason, even satisfactory to the banker and tend, to narrow from a selfish standpoint, to be interested in the his business field instead of extending it. agricultural prosperity of the country. Agri- The principal functions of banks, as inculture is the basic industry which furnishes us stitutions regulated and controlled by law, food and clothes. And only when agriculture are the safekeeping of the public's money and prospers can other industries and commercial the furnishing of credit to the public on proper activities, including banking, be said to be on a security. Since it is the public's money which permanently sound basis. is loaned, neither party to the loan contract Failure on the part of the bankers in many has a moral right to incur needless risk of loss communities to realize their true relation to even if he himself were willing to take chances the farmer is doubtless in part to blame for the of foreclosure or of forced extensions of the fact that the merchant, rather than the banker, loan. has been depended upon to a large extent to Two important factors that affect the safety furnish the necessary credit to the farmer. and profitableness of farming are the weather This method of obtaining credit has proved and the market, and neither the farmer nor wasteful and unsatisfactory to all parties conthe banker has an appreciable control over cerned. The banker has lost business that them. Farming is the annual investment of rightly belongs to him. The merchant, whose operating capital in a given place. Since the regular business is that of dealing in merchancapital of the individual farmer can not be dise and not in credit, has frequently lost divided as to place or location, it must be so heavily through bad debts, and the credit divided as to crops to be produced that the secured has been unduly expensive to the chances of serious loss by reasons of weather farmer. conditions, the market's conditions, or other Bank credit is usuall}7- cheaper than merchant influences will be reduced to a minimum. credit. Supplies can ordinarily be bought at a The farm itself furnishes a cash market lower cost for cash obtained from banks than without transportation charges for sufficient on time from merchants. The banks rather food and feed for the family and the stock on than the stores are the proper places to obtain the farm, and for this reason such crops are a credit. safe and, as a rule, a profitable investment for a reasonable part of the operating capital on i Supplied by the Department of Agriculture. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 719 the farm. When the farmer supplies his own ciations, as well as several of the Federal food and feed he is prepared to protect his Reserve Banks, are already doing something market crops against a temporarily unfavor- in this direction. The Federal Eeserve Bank able market or to get assistance from his bank at Dallas, Tex adopted such a credit statev in doing so. ment three years ago and is encouraging its It may be considered a safe general rule use by member banks with most satisfactory that not over 50 per cent of the cultivated results to the farmer as well as to the banks. farm land or of the operating capital should be A merchant's credit statement has been put into a single crop. The other part, as in- found to be essential in safeguarding commerdicated above should be put into crops not cial loans and a farm credit statement outlining ; subject to the same hazards as the main crop the system of farming to be pursued as well and should make ample provision for food and as the resources and liabilities of the applicant feed. This general rule is an important guide for a lean, is believed to be of equal importance to the farmer in preparing his application to in promoting the safety of short-time farm the bank for credit, as well as a guide to the loans. The farmer whose credit statement banker in passing upon the safety and profit- shows that he is planting or has planted a ableness of the farmer's cropping system, and sufficient acreage in crops for food and feed hence of his potential ability to repay the loan. and the remainder of his cultivated area in The short-time rural credit societies and market crops is following a system of farming organizations of Europe have been of great that furnishes a safe basis for credit. value to the European farmer because of the The local banker is generally recognized by work of competent and experienced members the people of his community as occupying a of loan committees in passing on applications position of influence and dignity and he should for loans. These committees scrutinize care- be both willing and able to render constructive fully the applicant's system of crops and banking service to his farmer patrons which methods of farming and insist upon their being will promote safer and more profitable farming. safe as well as profitable. Any features in the Such service will increase the banker's defarmer's cropping system that are defective posits as well as his loans by directly promoting are changed before a loan is made. The agricultural prosperity and incidentally comiVmerican banker should perform a like helpful mercial prosperity. service in relation to short-time loans, thus The credit statement now in use by the making these loans more safe and more surely Federal Reserve Bank at Dallas, Tex., with a profitable, both to himself and to the farmer. slight addition to the note at the bottom of In order to bring about such helpful relations the second page, is attached. It is believed between the banker and the farmer it seems that this credit statement may furnish helpful highly desirable that all banks should use a suggestions to other banking institutions that credit statement embodying an agreement as have not adopted a statement. Special attento the system of farming to be pursued by the tion is called to the part of the statement proborrower. A few of the State Bankers' Asso- viding for "Crops and stocks to be produced.77 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

720 FEDERAL RESERVE BULLETIN". AUGUST 1, .1018. FINANCIAL STATEMENT- FARMER. [IMPORTANT.-—Please fill all blanks, writing "no" or "none " where necessary to complete information.] Name To the B ank Address For the purpose of obtaining a line of credit with you not to exceed S , I tender the following statement of my farming business as of , 191.., and agree to notify you promptly of any change affecting my ability to pay. Property o ned by undersigned. Debts due by undersigned. Cash (on hand and in banks) 8. Notes secured by chattel mortgages (list below). Notes due me (amount collectible) Payable to above bank: Accounts due me (amount collectible) Due Secured by , Farm products; grain, cotton, etc., at market value (list on other side) '. (Describe security) Live stock—market value (list on other side) Payable to Machinery and tools (list on other side) Due Secured by Farm lands (describe on other side) (Describe security) Other lands (describe on other side) Payable to Improvements on farm (describe on other side). Due Secured by City real estate (describe on other side) Other assets (describe fully) (Describe security) Notes due to above bank—unsecured... Other notes due by me Accounts due by me j Mortgages or liens on real estate owned (describe in space | provided on other side) .! I 0ther debts (describe fully) | Net worth.. Total. ; Total. Amount of the assets listed above which are exempt by law $ Amount for which I am liable for partnership obligations Amount of the assets listed above which are pledged to secure my debts Amount for which I am liable on notes and accounts, not included in above statement, which have been transferred to banks or others Amount of liability incurred by indorsement or guaranty to accommodate others Amount of Liability on bonds, leases, or other unfinished contracts Amount of insurance carried on farm products $ ; on machinery, etc., $ ; on improvements S ; on other asseira $ ; and on my life $ in favor of Number of years in present business Number of years at present location I solemnly declare and certify that the above statement, and schedules on opposite side, are a true and correct account of the condition of my business on the day above stated. Witness my hand, this day of , 191 WITNESS: (Signature). NOTE.—If you have ever failed in business, attach a complete explanation and state basis of settlement with creditors. (Fill blanks on other side) Form C-4. Federal Reserve Bank of Dallas. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

n:\-a-v 1, 10SS. FEDERAL RESERVE BULLETIN. 721 List of real estate and improvements owned, with incumbrances thereon. [Listed in totals on other side.] Valuation. Mortgages or liens. Acreage or Description of Title to property dimensions. Location. improvements. in v.-hoso name. Actual. I When due. Amount. LIVE STOCK. '[Listed in total on other side.] Horses, i Mules. Cattle. Hogs. Poultry. ; Sheep. Goats. | Total value. i ! I i • i I Vaiue S i<5 .. . $ :§ s Is $ i T i 1 MACHINERY AND TOOLS. [Listed in total on other side.] Wagons. | Cultivators. ! Movers, i Threshers. ! Engines, j Binders, j Other tools. ! Total cost. Number. Cost , Less depreciation 8. Actual value S. FARM PRODUCTS. [Listed in total on other side.] Corn $ Oats $ "Wheat $ Hay or forage $ Fruit (dried or canned) 3.. Cotton $ Wool $ Potatoes $ Meat $ Other products % Total 9. AVERAGE EXPENSE AND YIELD. Cotton. Corn. Wheat. Oats. ! Other Average yearly expense per acre for plowing, planting, and working crop prior to gathering '. „ Avorage yearly expense por acre for harvesting S $ !3 S S Average yield per acre Bales. Bushels. : Bushels. Bushels. Tons. STATEMENT OF FARMING OPERATIONS, OR CROPPING SYSTEM. Farm is located vrhere. Number of acres in farm Number of acres to be cultivated. Number of people living on farm Farm is o • ;'ned by I am to pay as rent 72715—18 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

722 FEDERAL RESERVE BULLETIN. AUGUST 1,191S. Crops and slock io be produced. Acres in corn (legumes interplanted) Acres in peas or beans Acres in vegetable garden Acres in oats (legumes following) Acres in forage crop and kind Acres in other crops and kind Acres in wheat (legumes following) Acres in hav crop and kind Acres in pasture Acres in cotton Acres in potatoes Acres in bearing fruit Acres in grain sorghums Acres in rye Total acres Number beef animals to be marketed Quantity fresh fruit for marketing Quantity fruit and vegetables to be canned Number hogs to be fattened Quantity dried fruit for marketing Loads manure to be used on crop Number sheep or goats to be marketed Quantity poultry and eggs to be produced Tons commercial fertilizer to be used , Pounds wool to be produced Number of cows in milk NOTE.—The character of the cropping system of a farm business has a credit value of the highest importance to both the farmer and the iender, and as farming is the annual investing of capital and labor at one place, safety requires, as in other investments, that all the capital and labor be not invested in one thing, or in the production of one crop. In order that farming operations may be conducted on a safe and profitable basis every year, every farmer should raise enough poultry, hogs, milk cows, vegetables and fruit to supply the family with most of their necessary food and a sufficient number of acres should be planted in feed crops to feed the stock on the farm or to feed stock for the market, if desired; and the balance of the cultivated land in other crops for market; b*u t' n-o t• m o-re- th•a'n- -5 0 per ce-n•t o"f -th e cu-l•ti va•t e"d lan-d s-h ou"l•d be -p lan•t ed in one crop.Such a plan should enable the farmer to pay his debts promptly every year and result in greater prosperity for him. A FOREIGN EXCHANGE BANK. "The capital stock of the foreign bank shall pay five per centum annual dividends if earned and shall not be tax- The following bill (S. 3928) is now before able by any State or municipality or by the United States. the Committee on Banking and Currency of The five per centum dividend if not earned in any one the Senate, which has held hearings regard- year shall be cumulative. Any surplus shall be distributed as follows: One-half to surplus and one-half to the ing it: United States, until fifty per centum surplus on the then outstanding capital shall have been accumulated, and A BILL To amend the act approved December twenty-third, nineteen hundred and thirteen, known as the Federal Reserve Act, as amended thereafter such surplus dividends shall be paid into the by the acts of August fourth, nineteen hundred and fourteen, August Treasury of the United States. fifteenth, nineteen hundred and fourteen, March third, nineteen hun- "The Federal Reserve Board shall prepare an organizadred and fifteen, September seventh, nineteen hundred and sixteen, and Juno twenty-first, nineteen hundred and seventeen. tion certificate and file the same with the Comptroller of the Currency. Be it enacted by the Senate and House of Representatives "Upon the filing of such certificate with the Comptroller of the United States of America in Congress assembled, of the Currency as aforesaid, the said foreign bank shall That section fourteen of the act known as the Federal become a body corporate, and as such shall have the Reserve Act be, and is hereby, amended as follows: power— Strike out all in paragraph (e) of section fourteen and "First. To adopt and use a corporate seal. insert in lieu thereof: "Second. To have succession for a period of twenty "(e) To establish accounts with other Federal Reserve years from, its organization unless it is sooner dissolved by Banks and with the Federal Reserve foreign bank." an act of Congress. After section twenty-five insert a new section, as follows: "Third. To make contracts. "SEC. 25a. There is hereby created a Federal Reserve "Fourth. To sue and be sued, complain and defend, in foreign bank of the United States, to be under the super- any court of law or equity. vision of the Federal Reserve Board, and to be located in "Fifth. To appoint by its board of directors such'officers the city of New York, State of New York. and employees as are not otherwise provided for in this "The Federal Reserve foreign bank of the United act, to define their duties, require bonds of them and fix States, hereinafter referred to as the foreign bank, shall the penalty thereof, and to dismiss at pleasure such officers have an authorized capital of $100,000,000, and shall begin or employees. business with a paid-up capital stock of 320,000,000. The "Sixth. To prescribe by its board of directors, by-laws, stock of such bank shall be offered at par to the banks of not inconsistent with law, regulating the manner in which the United States and to the public by the Secreatry of the its general business may be conducted, and the privileges Treasury, any stock not subscribed for to be taken by the granted to it by law may be exercised and enjoyed. Treasury of the United States subject to sale at the option "Seventh. To exercise by its board of directors, or duly of the Secretary of the Treasury. authorized officers or agents, all powers specifically granted Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 723 by the provisions of this act and such incidental powers as right to determine or define the character of the paper thus shall be necessary to carry on the business of banking eligible for discount within the meaning of this aet. within the limitations prescribed by this act. "The aggregate of such notes, drafts, and bills, bearing "The foreign bank shall be conducted under the super- the signature or indorsement of any one borrower, whether vision and control of a board'of directors, consisting of nine a person, company, firm, or corporation, rediscounted for members appointed by the President upon the advice and any one bank, shall at no time exceed five per cent of the consent of the Senate. net unimpaired capital and surplus of said foreign bank, ''One of the directors appointed by the President shall but this restriction shall not apply to the discounting of be known as the governor, one as vice governor, and one bills of exchange drawn in good faith against actual existing as the Federal Reserve agent. The directors shall name values. The foreign bank may discount acceptances of a committee oi five as an executive board to actually man- the kinds permitted under the authority of this act. age the affairs of the bank. The members of the board "The foreign bank shall not at any time be indebted or shall be citizens of the United States over thirty-five years in any way liable to an amount exceeding the amount of of age and be men of tested mercantile experience and be its capital stock at such time actually paid in and remainfairly representative of the various parts of the United ing undiminished by losses or otherwise, except on account States. of demands of the following nature: "The directors shall be designated by the President "First. Notes of circulation. to serve for from one to nine years, respectively, and there- "Second. Moneys deposited with or collected by the after each member so appointed shall serve for a term of foreign bank. nine years, unless sooner removed for cause by the Presi- "Third. Bills of exchange or drafts drawn against dent. money actually on deposit to the credit of the foreign bank "After the first year the directors shall annually elect or due thereto. the governor and vice governor from among the directors "Fourth. Liabilities to the stockholders of the foreign appointed by the President of the United States. bank for dividends and reserve profits. "The salaries of the directors and officers shall be fixed "Fifth. Inabilities incurred under the provisions of the by the Federal Reserve Board and be paid from the earn- Federal Reserve Act. The discounting and rediscounting ings of the foreign bank: Provided, That the governor of and the purchase or sale by the foreign bank of any bills the foreign bank shall receive $25,000, the vice governor receivable and of domestic and foreign bills of exchange $15,000, and the reserve agent 810,000. and of acceptances shall be subject to such limitations, "The directors of the foreign bank shall receive in restrictions, and regulations as may be imposed by the addition to their salary a reasonable allowance for neces- Federal Reserve Board. sary expenses in attending meetings of the Board. '' The foreign bank shall have power— "The board of directors shall perform the duties usually "(a) To deal in gold and silver coin and bullion at appertaining to the office of directors of banking associa- home or abroad, to make loans thereon, exchange Federal tions and perform all such duties as are prescribed by law. Reserve notes for gold, gold coin, or gold certificates, and to "Said board shall administer the affairs of the foreign contract, for loans of gold coin or bullion, giving therefor bank fairly and impartially and without discrimination, when necessary, acceptable security, including the hypoand shall, subject to the provisions of law and the orders thecation of United States bonds or other securities which oi the Federal Reserve Board, extend to Federal Reserve Federal Reserve Banks are authorized to hold; Banks and to member banks, and to all other banks and "(b) To "buy and sell, at home or abroad, bonds and bankers throughout tho country, and to foreign banks and i notes of the United States, bonds and notes of foreign bankers such accommodations as may be safely and reason- Governments, and bills, notes, revenue bonds, and warably made in relation to foreign banking business. | rants, with a maturity from date of purchase of not exceed- ".The powers of the foreign bank shall be as follows: ing six months, issued in anticipation of the collection "To receive deposits from American and foreign banks of taxes or in anticipation of the receipt of assured revenues and bankers, from the United States or foreign Govern- by any State, county, district, political subdivision, or ments, in current funds in lawful money, national-bank municipality in the continental United States, including notes, Federal Reserve notes or checks and drafts, payable irrigation, drainage, and reclamation districts, such purupon presentation, and also for the collection of maturing chases to be made in accordance with rules and regulanotes and bills. tions prescribed by the-Federal Reserve Board; "The foreign bank may discount notes, drafts, and bills " (c) To purchase and to sell, with or without its indorseof exchange arising out of actual commercial transactions; ment, bills of exchange arising out of commercial transacthat is, notes, drafts, and bills of exchange issued or drawn tions as hereinbefore defined; for agricultural, industrial, or commercial purposes, or the "(d) To establish from time to time, subject to review proceeds of which have been used or which are to be used and determinations of the Federal Reserve Board, rates of for such purposes, the Federal Reserve Board to have the discount and exchange and commissions for the opening Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

724 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. of credits at home or abroad, to be charged by the foreign We have recognized the difficulties in the way of having bank for each class of paper which shall be fixed with a Federal Reserve Banks take any definite steps to relieve view to accommodating commerce and business. the situation; and with a view of pointing out some of "(e) To issue bank notes and receive Federal Reserve these difficulties, so in order that you may determine notes upon like terms and conditions as now provided for whether those same difficulties would apply to this protho Federal Reserve Banks. posed foreign-exchange bank, I would like to refer to a "(f) To open credits at home and abroad for account letter which I wrote some time ago to Secretary McAdoo of domestic and foreign banks or bankers, to facilitate ex- explaining some of the problems as we had seen them in ports and imports to and from the United States, and ex- the Federal Reserve Board. ports and imports to and from one foreign country to In that letter I stated to him that we had been unable another foreign country. to see that any advantage would be gained by having the "(g) Upon the direction and under rules and regula- Federal Reserve Banks engage in foreign-exchange operations prescribed by the Federal Reserve Board to establish tions or establish active agencies abroad for that purpose. branches and agencies in foreign countries for the purpose Senator WEEKS. Was that the unanimous opinion of the of facilitating commerce with the United States. board? "(h) No bank, banker, corporation, or individual, Gov. HARDING. AS far as I know, it is. There has been other than tho foreign bank, shall sell dollar balances at less no exception taken to the statement. We have discussed than gold par except as payment for merchandise imported it informally, and members of the board have known of into the United States without the express authority of the this letter, and I never have heard of any objection being Federal Reserve Board." raised to its contents. Either goods or gold must be sent to foreign countries TESTIMONY OF GOVERNOR HARDING. to create balances, and failing in that the only other means Much testimony has been taken by the of rectifying exchange is to secure credits in foreign countries. The Federal Reserve Board has no voice in con- House and Senate committees/ Governor trolling the direction of goods to or from foreign countries. Harding on June 27 appeared before the It can not afford to let our stock of gold be dissipated in Senate Committee on Banking and Currency order to pay debit balances of allied nations, all of which and testified as follows: are averse to permitting the exportation of gold, nor does it appear that the Federal Reserve Board is charged with Gov. HARDING. I am satisfied, Mr. Chairman, that the the function of negotiating for loans in foreign countries. Federal Reserve Board is very much interested in any- "That power is vested exclusively in the President, acting thing that will correct the present inequalities in exchange through the Secretary of the Treasury," in foreign rates abroad. The question is one which the members of countries. the board have carefully considered and devoted much I believe that in your bill there is some provision for the thought to ever since the summer of 1915, when sterling proposed foreign-exchange bank to negotiate loans in forrates began to drop here so violently, and we have given eign countries. as much time as we could to the subject. 1 would like to state right here, however, that the War The Federal Reserve Act authorizes the Federal Reserve Finance Corporation is empowered to issue bonds payable Banks to buy and sell foreign bills of exchange and to in foreign currencies, and the directors of the corporation establish agencies abroad, and under the provisions of have already given the subject some consideration and are that act the Federal Reserve Board has authorized agenawaiting the return of the Secretary of the Treasury in cies. Announcements have been made of this already order to consult with him, because such negotiations must, when the transactions were had. We have authorized under the act, receive his sanction. the Federal Reserve Banks—the Federal Reserve Bank of New York in particular—to establish an agency with Negotiations for foreign credits—I presume there is*no the Bank of England, with the Bank of France, and the impropriety in stating this—have been carried on con- Bank of Italy. The Federal Reserve Banks, though, as stantly by the Treasury Department for months past, in a rule, have not dealt directly in foreign exchange. There some cases with satisfactory results and in others, unforare several difficulties in the way, and there seemed to be tunately, without success. And many of these negotiano good purpose to be subserved to have them deal in tions are still pending. exchange. The difficulty recently in ou r transactions with Senator WEEKS. YOU mean to say that loans have been many neutral countries has been a scarcity of bills. The made on the other side? mere fact that the Federal Reserve Banks should go into Gov. HARDING. Not in European countries. The Treasthe market and compete with other dealers for this lim- ury negotiations to which I refer were principally with ited supply of bills would not add anything to the volume South American countries. of the bills, and might have a tendency to further advance The CHAIRMAN. YOU concluded negotiations of thatthe price of these foreign bills. kind with India? Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ArcrsT 1, 1918. FEDERAL RESERVE BULLETIN. 725 Gov. HARDING. I also refer to India; India and the Gov. HARDING. Well, it might, provided we were able Argentine are conspicuous examples of successful nego- to cover that credit in a satisfactory way, but there is tiations. where the problem arises, How are we going to cover that It is evident that unless neutral countries with which credit? negotiations are carried on are favorably inclined and will- Senator WEEKS. Well, Governor, do you think it is ing to cooperate loans from them can not be secured. practicable to disassociate our traneactione from those of The suggestion lias been made that it might be possible the allies in matters of this kind? to force an understanding by withholding our imports or Gov. HARDING. I am not prepared to discuss that; that by other drastic measures, but it is not for the board to say is a very broad question, involving the Treasury and the to what extent such methods would be effective in dealing State Departments, and I would rather not discuss it. with a delicate situation of this kind. We should remem- Under the proclamation of the President this whole matter ber, however, that a loan of an amount covering our own of foreign exchange is put into the hands of the Secretary debit balance when concluded would not bring dollar of the Treasury. exchange, as far as the general public is concerned, back to If these nations associated with us are unable to arrange par in foreign countries, unless the nations associated with for loans to cover their own debit balances, the natural us we're able at the same time to arrange for loans to cover consequence would be that allied exchanges would remain their own debit balances. at a discount and the dollar would be quoted at substan- This relates to the present situation, where we are linked tially the same level, the result between them being estabup with other countries in our trade balances, and where lished by the price of allied exchanges in New York. it all goes in a common pool. It has been suggested that the situation could be rec- The CHAIRMAN. However, Governor, if credits were tified by forbidding American banks to buy sterling balplaced with such a country so as to furnish us with the ances in neutral countries. But can this Nation afford any currency of that country sufficient to pay for our own pur- such remedy, as long as we do not and can not control forchases and such credits were used to pay for our own pur- eign exchange dealings in foreign countries? chases, the loss of dollar exchange arising through that This would not seem to prevent a firm in Spain, for country would fall not upon the United States but upon instance, instead of cabling t© a New York bank to sell those who employed those dollars there; is not that true? and draw £25,000 on London, from instructing a London Gov. HARDING . I shall discuss this question a little later bank to remit §125,000 to New York, in which case the on. However, that may be true, Senator, if we dissociated Spanish banker would buy the dollars in London instead ourselves entirely from, allied countries. of selling sterling in New York. The only difference The CHAIRMAN. We would pro tanto dissociate our is that in this case the exchange transaction would be made transactions in those particular negotiations? in London, and that instead of making New York the bank- Gov. HARDING. Unless some of the neutral countries ing center, as we have tried to do, the exchange transacshould sell their franc or sterling exchanges in our markets. tions would continue to be centered in London. This The CHAIRMAN. That would, as you say, leave the dollar objection would apply also to another plan proposed, of to be depreciated, but it would be a dollar depreciated forcing American exporters to sell their goods in the curwhich had been loaned to our allies and which would not rency of the foreign country, e. g., it has been suggested affect our interests directly in an adverse way, because if that should we sell $90,000,000 worth of goods to Spain in we obtained by credit a sufficient number of pesetas in pesetas that we would thus secure an ample supply of Spain, for instance, to pay for Pershing's purchases, pesetas with which to pay for the $30,000,000 of goods we Pershing would have the pesetas in Spain at par, if we got are buying in Spain. This would result, however, in the loan in Spain on that basis. That is true, is it not? discontinuing the use of the dollar as a means of exchange Gov. HARDING. If the proceeds of the loan should be in world markets, and we would be creating in its place a applied exclusively to Army purchases, this would be true peseta exchange market in Madrid and Barcelona. until the credit was exhausted, but the loan would have to We should consider, also, that if the plan should he be paid back, Senator. adopted of carrying on our entire Spanish trade in terms The CHAIRMAN. That is another story, about being paid of pesetas, imports and exports alike, we might thereby back. arbitrarily fix a lower rate of pesetas conceivably at par, Gov. HARDING. The liquidation of the credit is one of to the advantage of the importer and, as claimed by some, of the problems to be considered. to the disadvantage of the exporter. The fact would The CHAIRMAN. That is not the question I was asking remain, however, that if Spain in her relations to all other you. The question I asked you was that if we obtained countries, particularly to allied nations, continued to be a pesetas in Spain by a loan witk which to pay, for Persh- creditor nation and should be unwilling to make loans to ing's purchases in Spain, that would save us the great the value of goods bought by these countries in excess of loss of 40 per cent in Spanish exchange, would it not, as to her own purchases, allied exchanges would remain at a purchases? discount in Spain, and, owing to the relationship of these Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

726 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. exchanges to the New York exchanges, as already out- discount results in a decrease in the amount realized here lined, dollar exchange would continue at a discount in in Peruvian currency on the transaction. Importers, con- Spain. We would thus have two quotations, one perhaps verting Peruvian currency into foreign drafts for the purat par for our importers, but an actual market quotation chase of their merchandise, are the only ones profiting by at a discount for everyone else. the situation. Now, in my opinion, there are the underlying facts of "As the only means of overcoming the difficulty and the situation, a situation which is an extremely compli- affording a substitute for the gold, importation of which cated and perplexing one, and which the Treasury De- had been embargoed, it was urged that firms and individpartment as well as those who have been called in from uals operating in Peru be allowed to deposit gold in the time to time to give advice have tried their best to solve. Federal reserve bank in New York and the Peruvian Gov- We are all, I think, entirely agreed that in the interest of ernment issue gold certificates as currency, guaranteed by the allied group as a whole it is desirable, as a matter of the metal held in New York. It is this scheme which the prestige and for the sake of economic stability as well as Government has now incorporated in the gold-certificate the general advantage, that wherever and whenever law brought before the Peruvian Congress." possible there should be established the parity of allied It is evident, therefore, that where a country produces interests. Where you find, however, that the reestablish- more of a given commodity than it can consume at home, ment of these exchanges involves too heavy a sacrifice, or or where the article is perishable or is one which must be where it may prove impossible to conclude successfully sent to foreign countries in order to pay for necessary imloans in neutral countries on reasonable terms, we should portations, it is a serious detriment to the exporting counbe careful not to exaggerate the disadvantages accruing try—a neutral—to have the exchanges of the purchasing from the low level of allied exchanges in neutral countries, CQuntries rule at an abnormal rate. There being no nor should we imagine that appreciation in exchange will ready buyers for these exchanges, the result is a loss to work exclusively to our disadvantage and to the advantage the exporting country, unless it can control the market of the neutrals. value of the commodities and add to their price what is As an illustration, there may be cited abstracts of three lost in exchange. It is difficult to establish a definite rule reports from South American neutrals (reading): as to the effect of fluctuations in foreign exchange, because Abstract from a report of a Buenos Aires bank: so much depends upon simultaneous variations in the "Movement in favor of the country of all foreign ex- market price of the commodities which produce these changes (except those of the neutral countries) which exchanges. with a further advance of freight rates and scarcity of And, then, in these war times, with so many artificial tonnage increases the difficulties of our export trade and restrictions thrown around trade, there are some surprisreduces the f. o. b. prices of cattle and cereals." ing anomalies. Abstract from report from Venezuela: As an example, I was very much surprised yesterday by "The bank representatives here do not appear to be a statement which was made to me by some gentlemen who unduly anxious over the situation, and point out that had just returned from Paris, that one could purchase a whereas the purchasing power of the dollar has never been greater number of francs in Paris by using American paper so low in Venezuela before, the loss falls ultimately on the currency than he could by using American gold—that our producer in this country, who in practically every case paper currency is worth more in Paris than our gold is a Venezuelan. In this connection it may be of interest is. Upon asking the reason it developed that it is probably to point out that the legation, in selling its draft on the because the French Government is requiring all gold to ecretary of state for contingent expenses, at the present be turned over to it in exchange for French paper curtime loses about 20 per cent on the transaction.1' rency. But it is interesting to know that in Paris to-day In discussing the legislation proposed to Peru, providing you can buy more francs with American currency than for the issue of gold certificates up to a maximum of you can with American gold. 4,000,000 libra, secured in part by deposits in the Federal Senator POMERENE. What is the difference? Reserve Bank of New York, a Peruvian paper says this: Gov. HARDING. I understand about 20 or 25 points. "With an enormous trade balance in favor of this Repub- Senator WEEKS. What would that mean on a dollar? lic and the impossibility of importing gold to offset this Gov. HARDING. For instance, if one is able to buy balance, the market threatened to be still further over- francs at 5.70, say, for currency, he could get only 5.50 burdened with drafts on New York and London, with the francs for gold. There is quite an appreciable difference. dollar and pound sterling at a still greater discount on the Now, if exchange on a foreign country should advance Peruvian market. Contrary to popular belief, the dis- 40 per cent, it does not follow that the producer receives count of the dollar and pound sterling in Peru is highly thereby 40 per cent more for his goods, because the price unfavorable to Peruvian producers and shippers. Paid would depend upon the adjustment of these prices in in New York and London drafts for their products at the other countries and upon the relative importance of the quotations determined by these two markets and liqui- purchasing power in this country of that foreign country dating these drafts in Lima, every point increase in the in the world market. Generally speaking, I am of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDEBAL EESEEVE BULLETIN. 727 opinion, making due allowance for exceptions to the rule, the extent of $60,000,000, if we do not give Spain a credit that high rates of exchange on a given country tend to for this amount, how can the Spaniard draw on us in small exportations to it by*other countries and to reduced dollars; how can he force our dollars to a heavy discount importations from it by other nations. This would be the when he has none of our dollars but owes us so large a case even if Spain, for example, should buy goods in the sum in dollars? I can not see that he is selling our United States in dollars and not in its own currency. dollars. He is depreciating a sterling and franc. He has The fact that our dollars can be bought at a low price large balances due him in London and Paris, resulting enables Spain to buy just so many more dollars, and from sales of goods to Great Britain and France. He has therefore to pay for a correspondingly large amount of acquired these balances from the Englishman and the our commodities. Thus the tendency would be to in- Frenchman at a heavy discount, and he sells them to us crease the demand and prices paid for our goods and to in exchange for the commodities which we have sold him. stimulate our productions. We buy them at the comparatively moderate discount, about 2 per cent, at which sterling exchanges and of I do not see how the argument can be sustained that about 10 per cent at which francs have been staboth importers and exporters are unfavorably affected by bilized, and to the extent that we assist in stabiliz- \ow rates for dollar exchange in neutral countries. Suping these exchanges by these purchases we actually pose that our entire trade with Spain should be carried try for account of our allies against their obligation to on in pesetas and the dollar exchange is selling in Madrid repay us after a number of years at par plus interest. I at a discount of 30 per cent. Assuming that our balances think, therefore, that it is not the American dollar which with Spain amount to $60,000,000 in our favor, we would has been sacrificed, but that it is really the pound have a credit balance there of 345,000,000 pesetas instead sterling and the franc which have suffered. of 255,000,000. If, on the contrary, our export trade is figured in dollars, our exporters certainly would not suffer We should also take into account the fact that a very by the discount of the dollar in Spain. Clearly it is substantial portion of our Spanish credits has been disimmaterial to the producer of cotton, for example, whether posed of by our own sales of pesetas at the present high the purchaser is Spanish or American, provided the price premium to South American countries, thus reducing paid in dollars is the same. our adverse balances with them, so that to this extent The fact, however, that Spanish buyers are able to pur- we have enjoyed the full benefit of the high price which pesetas command at present. chase more cotton because they can buy dollars at a low Wherever the import trade of the United States is larger rate of exchange operates to the advantage of the A.merican than the export trade, as is the case with most of the seller of cotton because it creates a better demand for his South American countries, the high rates which now goods. The price of cotton in Spain must, of course, equal prevail in New York on these neutral exchanges, or the approximately the American price, plus costs of transdiscount of the dollar in these countries, results in our portation, insurance, loss of interest, and commissions, disadvantage. But with respect to some other countries, multiplied by the rate of exchange. These factors comthe high rate of exchange may be a source of profit to bined establish the price at which cotton may be delivered the United States, because as far as our own trade is conin Barcelona and open competition restricts the margin of cerned we are their creditors. But, taking the allied profits. In times of peace this margin is small, but in time group as a whole, and considering ourselves as a partner of war it is no doubt larger; but the margin is no greater for of the countries in the group, we are debtors to European the cotton dealer and the banker, whether exchange sells neutrals as well as to the South American neutrals, and at a discount, at par, or at a premium. The speculator in it is from this point of view that we should endeavor cotton or in pesetas may gain or lose by investing in cotton to reestablish allied exchanges in neutral countries, both or pesetas, or by selling them short. But the legitimate from the standpoint of prestige and for economic reasons. profits of the dealers are regulated by competition and are not increased or diminished by the fluctuations of ex- It will be interesting to consider the effect of discount in allied exchanges in neutral countries upon these In the case of cotton going to Spain, I do not countries themselves. Argentina must export her wheat think it can be established that the 30 per cent premium and her meats, Chile is dependent upon the sale of her on peseta exchange wall go to the American cotton dealer nitrates, Peru of her copper, Venezuela of her asphalt, or to the banker, nor would it be reasonable to assume that etc. It seems, therefore, that it is important for these the American trader would be willing to sell his cotton to countries to find ways of financing their sales to us. If Spain in dollars if the price of pesetas were materially there are no purchasers at reasonable rates of selling higher. It seems, therefore, that the difference at any francs or dollars in these neutral countries, I think, time between the dollar price and the peseta price is untherefore, their exportations are likely to be affected; it likely to be appreciable. It may be urged, however, that would seem to be to their advantage to make us loans or we are sacrificing our American dollars at a discount of 30 to establish some agency through which their Governper cent to the advantage of the Spaniard. But, as a ments might take over the balances which have been matter of fact, when the trade balance is in our favor to accumulated in allied countries through the sale of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

728 FEDERAL RESERVE BULLETIN. AUGUST 3, 1918. goods. I do not believe that the prestige of the United "Shares of stock subscribed from the passage of this act States in the finances of the world has been affected by until January thirty-first, nineteen hundred and seventhis war-time dislocation of normal exchanges, for it is teen, shall be paid as follows: well known that the temporary discount on dollar ex- "Sixty per cent of the value at the time of the subchange in neutral countries is clue mainly to the efforts scription; which we have made and are making to sustain the credit "Ten per cent on or before January thirty-first, nineteen of our allies, whose interest might be injured by our advo- hundred and eighteen; cating or contemplating a policy of withdrawing assist- "Ten per cent on or before January thirty-first, nineteen ance because of any temporary loss or inconvenience we hundred and nineteen; may sustain by standing by them. "Ten per cent on or before January thirty-first, nineteen I trust that I may have the opportunity at some con hundred and twenty; and the remaining venient time of discussing the framework of the bill. "Ten per cent on or before January thirty-first, nineteen hundred and twenty-one. "Shares subscribed after January thirty-first, nineteen Philippine National Bank Act. hundred and seventeen shall be paid in the form and manner prescribed by the board of directors of the bank. The act creating the Philippine National "SEC. 4. The Government of the Philippine Islands not Bank, originally passed by the third Philippine later than January thirty-first, nineteen hundred and Legislature on February 4, 1916, has been seventeen, shall purchase one hundred and one thousand amended and reenacted. Below is the text of shares, at par, of the said National Ban.]:;, the payment for said, shares of the Government to be made as hereinafter the act as now in effect: provided. Ninety-nine thousand shares of said capital [Fourth Philippine Legislature, second session. S. No. 154.] stock may be offered to the provincial and municipal governments or to the public at a price not below par which [No. 2747.J the board of directors of the bank shall from time to time AN ACT To amend in certain particulars act numbered twenty-six hundred and twelve, entitled "An act creating the Philippine National determine. Bank." "The voting power of all the stock of the National Bank Be it enacted by the Senate and House of Representativesowned and controlled by the Government of the Philipof the Philippines in Legislature assembled and by the au- pine Islands shall be vested exclusively in a committee thority of the same: consisting of the Governor General, the president of the SECTION 1. In order to explain certain provisions, in- senate, and the speaker of the house of representatives. crease the stability of the institution, and extend its "SEC. 5. There are hereby appointed, out of any funds powers, act numbered twenty-six hundred and twelve, in the insular treasury not otherwise appropriated, such entitled "An act creating the Philippine National Bank," sums as may be necessary for the payment of the shares to is hereby amended in certain particulars, so that hereafter be purchased by the Government of the Philippine Isthe said act shall read as follows: lands: Provided, That the capital and surplus of the Agri- '' SECTION 1. There is hereby created a bank to be known cultural Bank of the Philippine Islands shall be applied as the Philippine National Bank, the short title of which primarily to said payment: And provided, further, That shall be the National Bank. Its principal domicile and no sum shall be set up on the books of the auditor until place of business shall be in the city of Manila. it shall be necessary to make the payment or payments "SEC. 2. The said National Bank, upon its organization, authorized by this act. shall be a body corporate and shall have power: "SEC. 6. All the assets and liabilities of the Government "(o) To prescribe its by-laws; Agricultural Bank of the Philippine Islands, created under "(6) To adopt and use a seal; act numbered eighteen hundred and sixty-five, as amend- "(c) To make contracts; ed, shall be transferred to the National Bank: Provided, "(d) To sue and be sued; That the transfer of the assets of the Agricultural Bank "(e) To exercise the powers granted in this act and such represented by the capital and the net profits thereof incidental powers as may be necessary to carry out the shall be made as part payment of the ©ne hundred and business of banking within the limitations prescribed by one thousand shares subscribed by the Government of this act; and the Philippine Islands. This transfer shall be under- "(/) To exercise, further, the general powers mentioned stood as taking place upon the inauguration of the Nain the Corporation Law in so far as they are not inconsist- tional Bank in conformity with the provisions of section ent or incompatible with the provisions of this act. nine of this act, after which the National Bank shall be "SEC. 3. The capital of the National Bank shall be subrogated to all the rights, actions, and obligations of twenty million pesos, Philippine currency, divided into the Agricultural Bank, and the Agricultural Bank shall thereafter be deemed abolished. two hundred thousand shares of the value at par, of one "SEC. 7. Any loan or credit account transferred to the hundred pesos, Philippine currency, each. National Bank by the Agricultural Bank which, in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. FEDERAL RESERVE BULLETIN. 729 judgment of the board of directors of the National Bank, violation of this clause shall be sufficient cause for the reis round upon demand after its maturity to be uncol- scission of the contract and the foreclosure of the mortgage. lectible, shall be both as to principal and as to interest ''SEC. 11. Said National Bank is hereby authorized: due thereon redeemed by the Government and become "(A) To purchase or discount promissory notes, drafts the property thereof: Provided, That by agreement be- and bills of exchange issued or drawn for agricultural, tween the insular treasurer and the National Bank, the industrial or commercial purposes, or the proceeds of which said National Bank may renew any such credits for a have been used or are to be used for such purposes. period not exceeding five years without losing the benefit 11 (B) To make loans on, or to discount notes secured by, of the above guaranty. There are hereby appropriated, harvested and stored crops: Provided, That no loan on the out of any funds in the insular treasury not otherwise security of such harvested and stored crops shall exceed appropriated, such sums as may be necessary from time seventy per centum, of the market value thereof on the date to time to make such payments. of the loan: Provided, further, That the crops so mortgaged "SEC. 8. At no time shall shares be sold to the public shall be insured by the mortgagor for the benefit of the if, as a result thereof, the part f the capital stock held National Bank for their entire market value: And provided by private investors will equal or exceed the part owned finally, That if, owing to any circumstance whatever, the by the Government of the Philippine Islands. value of the crops given as security shall diminish, the "SEC. 9. The National Bank shall be inaugurated within mortgagor shall obligate himself to furnish additional seone hundred and eighty days from and after the passage curity or refund such part of the loan as the bank may deem of this Act, and the Governor-General shall fix such inau- necessary. Such loans shall be granted for a period of guration by proclamation upon the certificate of the Insular three months, subject to three months' extension, in tlie Auditor and the president of the bank that said institution discretion of the bank. is ready to begin operations. *'(C) To make loans to agriculturists in installments, on "SEC. 10. Said National Bank is hereby authorized to standing crops of the natural products of the Philippine loan not to exceed fifty per cent of its capital and surplus Islands, such as rice, hemp, copra, sugar, tobacco, corn, and all amounts realized from the sale of real estate bonds, maguey, etc., not in excess of three-fifths of the estimated as provided in sections twelve and thirteen herein, on value of such crops: Provided, hmcever, That before grantnotes secured by real estate mortgages. Payment of such ing such loans, the National Bank may require additional notes shall be secured by first mortgages on farm lands in security in the nature of mortgages on real estate duly the Philippine Islands, and in no case shall such loans registered in the name of the debtor or chattel mortgages, exceed sixty per cent of the actual value of said land, including those upon live stock, machinery, and agriculincluding the value of the permanent improvements tural implements, or personal bonds with sufficient surety thereon, such as buildings and machinery if the same or sureties, satisfactory to the bank. form an integral part of the agricultural development: "(D) To make loans to the several provincial and mu- Provided, however, That whenever the bank may deem it nicipal governments and to any other branch or subdivision advisable, the mortgages shall contain a clause obliging of the Government of the Philippine Islands on promissory the mortgagor to insure to their full value in the name of notes guaranteed by the central government, as shown by the National Bank such buildings and improvements. the endorsement thereon of the secretary of finance, ap- The due date of said mortgages shall not be less than one proved by the Governor General of the Philippine Islands, year from the date thereof, nor more than thirty years. or to purchase bonds lawfully issued by such provincial and The said mortgages may, by their terms, be made pay- municipal governments and any other branch or subdiviable at one time or in installments: Provided, That when the sion of the Government of the Philippine Islands. due date of the mortgage is five years or more after the date " (E) Generally, to make advances or discount paper for of its execution, the principal and interest of the loan agricultural, manufacturing, industrial, or commercial purshall be made payable by its terms in equal installments poses: Provided, That loans, discounts, or advances made of not more than one year each. Loans made by the under this section shall have maturities not exceeding one National Bank on real estate security shall bo made for year, renewable from year to year, in the discretion of the. the purpose of promoting agriculture. Applications for bank. such loans shall be in writing and under oath, and shall "SEC. 12. The National Bank is hereby authorized to contain, among other things. issue real estate bonds in any sum not to exceed ninety "(«) A detailed description of the real estate; per cent of the amount of real estate loans held by said " (b) An appraisal thereof at its reasonable market value; bank, under section ten herein. Said bonds shall be en- "(c) A full statement of the purposes for which the loan graved. Said bonds shall be signed by the president of is desired. the bank, authenticated by the insular auditor and shall "It shall be unlawful to use the proceeds of said loan, bind the bank to pay the bearer thereof on the date therein or any part thereof, for any purpose or purposes except named the principal sum mentioned in said bond with inthe purpose or purposes set out in said application. Any terest payable semiannually at such rate as the board of 72715°—18 7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

730 FEDERAL RESERVE BULLETIN. AUGUST I, 1918. directors may fix. Said bond shall be payable, both prin- designate: Provided, however. That such of the bonds so cipal and interest, in gold coin of the United States: Pro- chosen by lot for redemption as have not been outstanding vided, however, That bonds held by persons or corporationsfor at least three-fourths of the period for which issued resident in the Philippine Islands shall be payable in law- shall be retired with a premium of five per centum of the ful money of the Philippine Islands, or in gold coin of the par value thereof. The bonds so chosen for redemption United States at the option of the said bank. The amount shall cease to bear interest beginning witih the date set of said real estate bonds outstanding as herein provided, for their withdrawal, and the aforesaid selection by lot falling due on any given date or prior to such given date shall take place at least one hundred days before the date shall never at any time exceed the real estate notes as of the withdrawal: And provided, That the serial numbers described in section ten herein held by the said bank, of the bonds so selected shall be published for a period of which fall due on the said given date or prior thereto. not less than three months in two daily newspapers of "Said real estate bonds shall be received by the insur- general circulation in the Philippine Islands, and by notifiance commissioner under section one hundred and seventy- cation of the Bureau of Insular Affairs at least three months eight of act numbered twenty-four hundred and twenty- before said redemption. seven. Said bonds shall also be receivable by way of "SEC. 14. The board of directors may, at the request of security in all customs and internal revenue transactions the holder, authorize the payment of the interest on any where security is required, and in any and all cases where bond at the branches or agencies of the bank in the municiby statute security may be required in dealings with the palities of the Philippine Islands or in the United States. Government. Said bonds shall be exempt from any and "SEC. 15. Said National Bank is hereby authorized to all taxes levied or assessed by the Government of the issue circulating notes. Said notes shall never be issued Philippine Islands, or any department, division, or sub- in any amount exceeding the paid-up capital stock and surdivision thereof. plus of said bank plus the amount of gold coin of the "Said real estate securities against which bonds are United States held in the bank's own vaults or to its order issued as provided heroin shall be deposited with the treas- in the treasury of the Philippine Islands or of the United urer of the Philippine Islands, and each of said bonds when States or in solvent National Banks of the United States or issued shall bear on its face a certificate of the insular in any Federal Reserve Bank. treasurer in words and figures as follows: "The securities described in section eleven, subsection " ' I hereby certify that there are on deposit in the treas- (A), of this act. and the proceeds thereof shall be held ury of the Philippine Islands first mortgage real estate inviolable for the payment and redemption of said circulatfarm securities in the sum of one hundred eleven and one- ing notes. Said circulating notes shall be engraved and ninth per cent (lllJ-%) covering farm land of an appraised shall be payable on demand to the bearer in lawful money value of one hundred eighty-five and five twenty-sevenths of the Philippine Islands. There shall at all times be held per cent (185^%) of the face value of this bond; which by said National Bank a sum not less than thirty-three and said real estate farm securities or other first mortgage one-third per cent of the total amount of said circulating real estate farm securities of equal value or the proceeds notes issued and outstanding and not covered by gold coin thereof are to be held by me as security, additional to the of the United States as herein provided for in lawful money promise of the Philippine National Bank for the prompt of the Philippine Islands. payment of this bond, principal and interest. "Said sum. shall be available only for the purpose of redeeming the circulating notes herein provided for. "It is hereby further provided that in addition to the " l Treasurer of the Philippine Islands.1 circulating notes above provided for, said National Bank "Changes in this act or in the laws of the Philippine shall have authority to issue its circulating notes against Islands which may hereafter be made shall not in any man- gold coin of the United States to the full value thereof: ner affect the real estate bonds issued hereunder which may Provided, however, That such gold coin against which cirbe outstanding at the time of such change or changes, nor culating notes have been issued shall be held by said bank shall any such change or changes affect the rights of any and used for no other purpose except the redemption of holder or holders thereof. said circulating notes. The said bank, however, shall have "The principal and interest of said real estate bonds shall the privilege of redeeming said circulating notes in any be payable in Manila or New York, at the option of the lawful money of the Philippine Islands. Such circulating holder thereof except as hereinafter provided. notes shall be exempt from any and all taxes levied or " SEC. 13. Said bonds shall be issued in such amounts and assessed by the Philippine Government, or any departform, at such times, and for such periods as may be ex- ment, division, or subdivision thereof. pressly provided by resolution of the board of directors "The said circulating notes shall be receivable by the of the Philippine National Bank. Said bonds shall be Philippine Government in payment of all taxes, dues or redeemable at par on or before the date of their maturity other claims due or owing to said Government, and shall and shall contain a provision to the effect that they are be redeemed by the bank on demand, in lawful money of subject to redemption by lot at such date as the bank may the Philippine Islands, at the central office in Manila. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 731 "SEC. 16. The Philippine National Bank is hereby au- with the approval of the board of directors: Provided, thorized to receive deposits of funds of the Insular Govern- further, That whenever the president or vice-president, by ment, the Provinces, municipalities, Postal Savings Bank, order of the board of directors, shall temporarily or perassociations, corporations, and private persons, and it is manently perform duties incumbent upon other officers or hereby made obligatory for the aforesaid Insular, provin" employees, they may be granted compensation additional cial, and municipal governments to make their deposits to the salary fixed by this act for the president and vicein the National Bank. The interest paid by said bank on president; but the resolution of said board shall not take deposits so made shall not exceed four per centum per effect until the written approval of the Governor General annum: Provided, however, That whatever in the judgmentand of the presiding officers of both houses of the Philipof the secretary of finance, it is in the public interest to pine Legislature has been secured. The orders of the make deposits from public funds in other banks or in- said board of directors in this respect may be modified or stitutions legally authorized to receive such deposits he is repealed at any time, provided they are approved in each hereby authorized to cause the same to be done under such, case by the Governor General and the presiding officers of terms and conditions as he may deem proper. both houses of the legislature. "SEC. 17. The affairs and business of the National Bank "SEC. 20. The president of the National Bank shall, shall be managed by a board of directors consisting of the before assuming charge of the government thereof, furnish president of the bank, who shall be chief executive thereof bond in a sum of not less than two hundred and fifty thouarid chairman of the board at the same time, one vice- sand pesos, and the vice-president shall furnish bond in president, who shall assist the president and act in his stead the sum of one hundred thousand pesos for the faithful in case of absence or incapacity, and five members elected performance of their duties. as hereinafter provided. "SEC. 21. All the other officers and employees of said "The president of the bank shall have power to make National Bank or any branch thereof, shall, if and as reloans on commerical paper for periods of time not to exceed quired by the board of directors of said bank, before enfour months and in sums not exceeding fifty thousand tering upon the performance of their duties* furnish a pesos in any one case, but he is required to submit a rer fidelity bond for the benefit of said National Bank, in the port on each' such loan to the board of directors at its form and amount prescribed by the board of directors of next succeeding session. It shall also be his duty— the National Bank. For this purpose, and for this purpose " (a) To make, with the advice and consent of the board alone, all officers and employees of the National Bank of of directors, all contracts on behalf of the said bank and whom a bond is required shall be deemed public officers to enter into all necessary obligations by this act required and employees, respectively, and the provisions of act or permitted; numbered twenty-four hundred and thirty-six, of the Phil- " (h) To report weekly to the board of directors the main ippine Legislature, creating the fidelity fund, are hereby facts concerning the operations of the bank during the made applicable to all said officers and employees. preceding week and to suggest changes in rates of, discount, ' •' SEC. 22. The attorney general of the Philippine Islands exchange, or of policy which may to him seem best; shall be attorney for said National Bank and may, when- "(e) To furnish, upon request of the secretary of ever he may deem it proper, in specific cases delegate his finance or of the Governor General of the Philippine Islands, duties, to the fiscal of the city of Manila or any provincial any information in his possession regarding the operations fiscal, as the case may be: Provided, however, That the of said bank. board of directors of said bank shall have power to employ "SEC. 18. The president and vice-president shall be ap- such additional attorneys as may be necessary. pointed by the Governor General, by and with the consent "SEC. 23. The insular auditor shall be ex officio auditor of the Philippine Senate, and may be removed for cause of the National Bank and it shall be his duty to make an by said Governor General, by and with the same consent. examination of the books of the bank and report thereon at The five remaining members shall be elected and may be least once each year to the Governor General of the Philremoved in accordance with the provisions of act num- ippine Islands, through the secretary of finance, and to bered fourteen hundred and fifty-nine, the Corporation the board of directors of said bank. The cost of such Law. The president may, with the authorization of the examination and report shall be reimbursed by said bank, board of directors, delegate from time to time any of his "SEC. 24. The National Bank shall be subject to inspecduties or functions to any officer of the bank. tion by the insular treasurer with regard to its solvency "SEC. 19. All the other officers and employees of said in the manner provided by law. National Bank shall be appointed and removed by the pres- "SEC. 25. The secretary of finance, the insular treasident thereof: Provided, however, That for the appointmenturer, and the insular auditor are hereby prohibited from and removal of those receiving more than two thousand owning stock in the National Bank, or from becoming pesos per annum, the approval of the board of directors indebted to said National Bank, directly or indirectly, in shall be required. The officers and employees of saia bank any sum. shall not be subject to the civil service law, and their "SEC. 26. The insular treasurer and auditor, or other duties and compensations shall be fixed by the president, officers designated by law to inspect or investigate the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

732 FEDERAL RESERVE BULLETIN". AUGUST 1, 1918. condition of said National Bank, shall not reveal to any located, and if and when permitted by law of the United person other than the Governor General, the secretary of States, to conduct a deposit and discount business with the finance, and the board of directors the details of the in- said Federal Reserve Bank to the extent that conditions spection or investigation, nor shall they give any informa- may require, under the instructions of the board of direction relative to the funds in its custody, its current accounts tors of the said National Bank. or deposits belonging to private individuals, corporations, "SEC. 31. The National Bank may establish branch or any other entity, except by order of a court of com- banks in the provincial capitals and in those municipalities petent jurisdiction. in which, in the judgment of the board of directors, the in- "SEC. 27. The president of the National Bank shall be dustrial, commercial, or agricultural movement may reappointed for a term of six years, and shall receive an quire it. The agents and other officers and employees of annual salary of twenty-four thousand pesos. The vice- said branch banks shall be appointed and may be removed president shall hold office for a like term as the president in accordance with the provisions of section nineteen of and shall receive a salary of twelve thousand pesos: Pro- this act, and shall furnish bond in a sum to be fixed in each vided, however, That the vice-president shall receive the case by the board of directors. same salary as the president when acting in the stead of "With the authorization of the Secretary of the Interior the latter. The other five members of the board of di- first had, the board of directors may appoint as agents, rectors shall hold office for one year and receive per diems cashiers, or tellers of said banks the provincial or municof twenty pesos for each meeting actually attended by ipal treasurers, who shall in this case furnish such bond them. and receive such additional compensation as the bank may "SEC. 28. The stockholders shall meet on the first Tues- determine, and shall be removable from office, not only as day after the first Monday in March of each year to elect such agents, cashiers, or tellers, but, also as such provincial fhe five directors or members of the board of directors or municipal treasurers, by the Governor General, for viotor the current year, each stockholder or his authorized lation of the provisions of this act or of the by-laws of the proxy being entitled to as many votes as there were shares bank or any instructions received by them from said bank. registered in his name on January thirty-first immediately "SEC. 32. The branch banks of the National Bank are preceding and owned by him on the date of election. authorized to exercise the powers conferred upon them by "SEC. 29. The board of directors created by section the board of directors of the bank. seventeen of this act shall have general supervision, man- "SEC. 33. The branch banks shall make detailed daily agement^ and control of the affairs of said bank and shall reports of their transactions to the central office of the from time to time fix the rate of interest, discount or ex- National Bank at Manila, and shall submit to a periodical change to be charged by said bank and make public an- examination by an examiner to be designated by the board nouncement of the same at the head office. The board of of directors of the National Bank., directors may also fix different rates of interest on loans in "SEC. 34. Nothing contained in this act shall be conaccordance with the different classes of securities herein strued to prevent the National Bark from taking over and . specified: Provided., That the said National Bank shall re-extending upon terms and conditions which to the board quire definite security in written form to protect each and of directors shall seem just for a period of not exceeding every loan, discount, or other advance of funds made by it. five years the loans already made and outstanding at the The board of directors shall make and publish seraiannually time of the passage of this act by private banks with Gova general balance of the business of said bank. ernment funds deposited in said banks, but in no event "SEC. 30. The said National Bank, by this act created, shall the amount of said loans thus taken over by the may establish branches or agencies in the United States National Bank exceed one million five hundred thousand of America and in other countries at such points as may pesos, and no part of such loans so taken over shall be conbe determined upon by the board of directors of the said sidered as subject to any restrictions elsewhere provided National Bank. It shall be the function of each of the in this act as to the amount of its capital which may be said agencies— used by said bank for any specific purpose, and in this "(a) To receive, transmit, and disburse any funds of case it shall be the duty of the insular treasurer to keep the Philippine Government payable in the United States. on deposit in the National Bank a sum equivalent to the "(6) To receive, transmit, and disburse any funds of the total amount of said loans for a period of time not exceed- United States Government which may be placed on deposit ing five years. with, or entrusted to it. "SEC. 35. The National Bank shall not, directly or in- "(c) To receive, transmit, and disburse any funds of directly, grant loans to any of the members of the board individuals, firms, companies, or corporations engaged in of directors of the bank nor to agents of the branch banks business with the Philippine Islands, or having interests "SEC. 36. The National Bank is hereby authorized to therein. purchase and own such real estate as may be necessary "(c?) To engage in business to the extent permitted by for the purpose of carrying on its business. It is also law of the United States with the Federal Reserve Bank authorized to hold such real estate as it may find necessary of the district in which said branches or agencies may be to acquire in the collection of debts due to the said bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1, 1918. EEDEEAL BESEBVE BULLETIN. 783 or to its branches; but real estate acquired in the collection to be circulated, forged notes and bonds in imitation of of debts shall be sold by the said bank within five years those of the National Bank. after the date of its acquisition, "SEC. 42. No fee or charge of any kind by way of com- "SEC. 37. The bank is hereby authorized to erect bonded mission shall be exacted, demanded or paid, for obtaining warehouses for depositing- therein the goods given to it loans, and any officer, employee, or agent of the bank exactin pledge, in any provincial capital or any municipality ing, demanding, or receiving any fee for service in obtaining where the commercial movement or industrial or agricul- a loan or for use of his influence to obtain a loan shall be tural importance of the place may require it. punished as hereafter established for violation of this act. "SEC. 38. The mortgagor shall have the right, within one ''SEC. 43. After deduction of the administration exyear after the sale of real estate as a result of the fore- penses, the net profits or gains resulting from the operations of said National Bank shall be apportioned semiannually as closure of a mortgage, to redeem the property by paying follows: the amount fixed by the court in the order of execution, with interest thereon at the rate specified in the mortgage, "For the creation and maintenance of a reserve, a sum and all the costs and other judicial expenses incurred by equal to fifty per centum of the net profits. The remainthe bank by reason of the execution and sale and for the ing fifty per centum shall be distributed among the stockcustody of said property. holders in the form of dividends: Provided, however, That the dividends so to be distributed shall not exceed in any :: SEC. 39. If, from any cause whatsoever, any of the secucalendar year twelve per centum of the paid-up capital: rities specified for the loans provided for in this act or And provided, further, That in case there is a surplus after accepted by said bank as security for loans or discount the necessary provision has been made for the reserve and decline or depreciate in market value in part or as a whole, dividend above mentioned, such surplus shall bo transor on nonperforiL.ian.co of any promise made to secure the ferred to the account of undivided profits. loan or discount, or upon nonpayment of any liability "SEC. 44. All profits assigned as dividends to the shares under a loan or discount, or upon bills of exchange, notes, of the Government shall be paid into the insular treasury, and checks, the said bank may demand additional securifor the general funds thereof. ties or may forthwith declare any such obligation due and " SEC. 45. The legal existence of the Philippine National payable and upon twenty-four hours notice, if practicable, Bank created by this act shall be for a period of fifty or without such notice, if otherwise demand, soil, assign, years, counting from the day on which it began officially transfer, and deliver the whole of said securities or any its operations. This period may be extended for fifty part thereof, or any substitutes therefor, or any additions years more by an act of the Philippine Legislature. thereto, or any other securities or property given unto or left in the possession of, or thereafter given unto or loft in "SEC. 46. All banks not organized and transacting busithe possession of the said bank for safekeeping or otherwise, ness under a charter granted by the Philippine Legislature at any brokers' board or at public or private sale, at the expressly exempting them from the restrictions and penalties of this section, and all persons or corporations doing option of said bank, without either demand, advertisethe business of bankers, brokers, or savings institutions, ment, or notice of any kind, and at such sale, if public, the are prohibited from using the word "national" as a portion said bank may itself purchase the whole or any part of the of tho name or title of such bank, corporation, firm or property sold, free from any right of redemption on the partnership; and any violation of this prohibition compart of the mortgagor or pledgor. In case of sale for any mitted after ninety days subsequent to the date of enactcause, after deducting all costs or expenses of any kind ment of this act shall subject the party chargeable therefor collection, sale or delivery, the said bank may apply with to a penalty of not less than one hundred pesos for the residue of the proceeds of tho sale so made, to pay one each day during which it is committed or repeated. or more or any or ail of the said liabilities to the said bank, "SEC. 47. The board of directors of the National Bank as its President shall deem proper, whether then due or is hereby authorized to adopt the necessary regulations for not due, making proper rebate for interest on liabilities its operation, in conformity with this act and the cornot then due, returning the overplus, if any, to the mortporation law. gagor or pledgor who shall remain liable to and pay to said "SEC. 48. All acts or parts of acts inconsistent or in- Bank for any deficiency arising upon such sale or sales. compatible with the provisions of this act are hereby "SEC. 40. If the proceeds of the sale of securities held repealed. as collateral for loans by said bank do not cover the full "SEC. 49. Any person who shall violate any of the proamount of the loan, together with interest and other charges visions of this act shall be punished by a fine not to exceed thereon, the bank may proceed against the debtor for the ten thousand pesos, or by imprisonment not to exceed five difference, but any amount exceeding the full indebtedyears, or by both such fine and imprisonment. ness to the bank shall be paid to the debtor. "SEC. 50. The Philippine National Bank shall at all ';SEC. 41. The provisions of act numbered seventeen times keep on hand in its vaults or with the treasury of hundred and fifty-four and its amendments are hereby the Philippine islands a sum in lawful money either of made applicable to violations of the law consisting in the the Philippine Islands or of the United States which shall making, or causing to be made, and circulating, or causing be computed as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

734 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. "Thirty-three and one-third per cent of the circulating a total capital of $294,308,400, total surplus of notes outstanding not covered by gold coin as provided in $355,195,859, and total resources of $6,209,section eighteen of act numbered twenty-six hundred and 063,819. twelve, as amended by this act. "Twenty-five per cent of the demand deposits outstanding and credited on its books, except such funds as are on Capital. Surplus. Total deposit with solvent banks in the United States and collateraled by securities approved by the insular treasurer, or in solvent banks approved by the insular treasurer; Bank of Jonesboro, Jonesboro, Ark... $150,000 $150,000 $2,067,857 Bankers Trust Co., Little Rock, Ark.. 250,000 5,403 2,244,217 ten per cent of the certificates of fixed deposit maturing Southern Trust Co., Little Rock, Ark. 500,000 100,000 3,417,445 The Denver Stock Yards Bank, Denwithin one year from the date upon which the computation ver, Colo , 250,000 2,068,037 is made, or sixty-six and two-thirds per cent of those ma- The Citizens Bank, Metter, Ga 30,000 239,328 Pittard Banking Co., Winterville, Ga. 25,000 5,000 118,032 turing within thirty days from such date: Provided, That The Meridian State Bank, Meridian, if the Philippine National Bank shall have funds subject Idaho 25,000 25,000 Bank of Murtaugh, Murtaugh, Idaho. 25,000 27,500 to check with national banks or Federal Reserve Banks of 30,000 8,000 Pierce Trust & Savings Bank, Sycathe United States, such funds may be considered as con- more, 111 100,000 50,000 806,187 stituting a part of the twenty-five per cent and ten per Gillespie Trust & Savings Bank, Gillespie, 111 50,000 15,000 536,859 cent specified in this section up to a sum to be fixed from Des Plaincs State Bank, Des Plaines, 50,000 33,000 623,479 time to time by the secretary of finance, with the ap- Farmers State Bank, Eureka, 111 100,000 614:458 proval of the Governor General. Marshall State Bank, Marshall, 111 60,000 260,411 Stcuben County State Bank, Angola, "SEC. 51. The Philippine National Bank is hereby au- Ind 40,000 9,341 199,179 Hilisboro State Bank, Hillsboro, Ind.. 25,000 6,000 181,161 thorized to guarantee, both as to principal and interest, or Citizens State Bank, Jamestown, Ind. 30,000 7,500 358,449 Sparta State Bank, Cromwell, Ind 27,500 120,522 either, bonds issued by duly incorporated companies for Peru Trust Co., Peru, Ind 100,000 ""25," 655" 1,107,371 the erection of and addition or additions to industrial Fairbank State Bank, Fairbank Iowa. 26,000 14,000 418,350 Farmers State Bank, Elberon, Iowa... 40,000 20,000 566,650 plants or manufactories principally used for the manufac- Mount Ayr State Bank, Mount Ayr, | ture and preparation of the products of the Philippine Iowa 100,000 15,000 682,024 Bank of Green, Green, Kans 40,000 15,400 351,825 Islands: Provided, hovjever. That such guarantee shall onlyCommercial Trust & Savings Bank, New Orleans, La 1,250,000 800,000 18,816,787 be lawful when approved by a committee composed of the Liberty Bank of Baltimore County, Governor General of the Philippine Islands and the pre- Gwynn Onk Junction, Md I.. 25,000 5,000 245,108 Gwinn State Savings Bank, Gwinn, siding officers of the two houses of the Philippine Legis- Mich 25,000 15,000 358,653 The Lake City Rank of Minnesota, lature. Lake City, Minn 50,000 50,000 607,421 "Subject to the same approval, the National Bank is Deposit Bank of Winona, Winona, Minn 400,000 100,000 3.210,226 hereby authorized to purchase bonds issued by an;/ duly Denton State Bank, Denton, Mont... 25,000 3,500 '215,491 incorporated company engaged in the manufacture or Em to p w ir n e , M B o a n n t k & Trust Co., Lewis- 100,000 1,500 816,016 preparation of products of the Philippine Islands. Such Chappeii State Bank, Chappell, Nebr. 25,000 2o,000 I 592,904 Farmers State Bank, St. Edward. I bonds shall be secured by a first mortgage or deed of trust Nebr I. 25,000 279,979 on the property of the company. The face value of the Cranford Trust Co., Cranford, N. J.... 100,000 ""$6," 666"! 1,559,131 Princeton Bank & Trust Co., Princebonds issued and secured by such mortgage or deed of ton, N. J 100,000 i 1,816,919 Security State Bank, Portales, i trust shall not exceed sixty per cent (60%) of the fair value N.Mex .J 25,000 150,000 I 189,014 of the property securing the bonds. The property serving Co Y m o m rk er , c N ia . l Y Exchange Bank, New 200,000 4,000 7,526,173 as security for the bonds shall consist of land, buildings, New Netherland Bank of New York, N. Y 200,000 700,000 5,305,247 machinery, and equipment of such company in the Phil- Bank of Suffolk County, Stony Brook, ippine Islands." N. Y 25,000 200,000 417,365 County Trust Co., White Plains, N. Y. j 100,000 15,000 2,561,627 SEC. 2, This act shall take effect on its approval. Mutual Trust Co. oi" Westches'tor j 50,000 Approved, February 20, 1918. Ci C tiz o e u n n s t y "B , a P n o k r , t C C u h y e a s h te o r g , a N F . a Y l ls, Ohio. i I 30 5 0 0, , 0 0 0 0 0 0 6 2 0 , , 0 0 0 00 0 2, 3 0 4 5 7 2 , , 2 0 3 5 5 7 Cuyahoga Falls Savings Bank Co., i Cuyahoga Falls, Ohio j 100,000 30,150 1,137,318 West Lafayette Bank Co., West Lafayette, Ohio : 100,000 50,000 1,026,750 Peoples Savings & Trust Co., Akron, i State Banks and Trast Companies Admitted. 200,000 100,000 4,408,608 Dime Savings Bank Co., Canton, Ohio i 200,000 12D,000 3,536,041 The following list shows the State banks and The Citizens State Bank Co., West ! Milton, Ohio I 30,000 5,000 296,879 trust companies which have been admitted to Geneva Savings Bank Co., Geneva, Ohio :J 180,000 65,000 965,140 membership in the Federal Reserve system Scandinavian American Bank, As- j toria, Oreg i 100,000 10,000 1,194,894 during the month of July. Bank of Commerce, Philadelphia, Pa. 300,000 140,000 2,115,265 Commercial Trust & Savings Bank, Five hundred and eighty-nine State institu- Memphis, Tenn : 350.000 100,000 5,782,735 Trent State Bank, Goldthwaite, Tex.; 50,000 25,000 407,937 tions are now members of the system, having First State Bank, Killeen, Tex ! 25,000 7,000 177,350 First State Bank, Stamford, Tex i 55,000 13,000 345,045 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 735 Foreign Branches of American Banks. Capital. Surplus. I Total i The Board has recently authorized the establishment of additional foreign branches and Citizens Stato Bank, Sheboygan, Wis. $200,000 8125,000 $2,069,000 First State Bank, Graford, Tex 25,000 7,000 129,159 subbranches of American banks. Following The First State Bank, Ladonia, Tex.. 25,000 12,500 279,427 Bio Grande Valley Bank & Trust Co., is a list of those authorized to date: El Paso, Tex 500,000 90,000 3,679,306 El Paso Bank & Trust Co., El Paso, National City Bank, New York City: Date authorized. Tex 200,000 1,645,757 Citizens State Bank, Commerce, Tex. 25,000 2,500 169,311 Branch at Buenos Aires, Argentina. . .Sept. 2,1914 Brownfield State Bank, BrownfieM, Subbranch at Montevideo. Uru- Tex 25,000 12,500 258,269 First State Bank, Wylie, Tex 30,000 12,500 273.672 guay x Apr. 16,1915 The Deseret Savings Bank, Salt Lako Branch at Rio de Janeiro, Brazil Sept. 2,1914 City, Utah 500,000 | 300,000 4,457,619 Utah Savings & Trust Co., Salt Lake Subbranches at Santos, Sao Paulo, Fr C an it k y l . i n U t B ah ank, Franklin, W. \ra 3 4 0 0 0 , , 0 0 0 0 0 0 I | 2 5 0, , 0 5 0 0 0 0 1, 2 9 4 8 2 2 , , 4 5 1 4 4 1 Pernambuco, Para, and Bahia, Second Ward Savings Bank, Milwau-* Brazil Dec. 23,1914 kee, Wis : 1,000,000 ! 600,000 23,994,518 Bank of Oakfteld, Oakfield, Wis 25,000 | 10,000 292,207 Branch at Ilabana, Cuba Mar. 17,1915. Subbranches at Santiago, Matanzas, Cienfuegos, Guantanamo, Following is a comparative statement show- Camaguey. Cardenas, Manzaing the number, capital, surplus, and total nillo, Cuba; Kingston, Jamaica; and Santo Domingo, Santo Doresources of State institutions which have mingo '... .Mar. 17,1915 joined the Federal Reserve system, as of Branch at Valparaiso, Chile Oct. 18,1915 January 1, 1918, and July 15, 1918: Subbranches at Antofagasta and Santiago, (.bile '. Oct. 18,1915 Branch at Genoa, Italy May 25,1916 State bant members of the Federal Reserve system up to Subbranches at Turin, Milan, January 1 } 1918. Venice. Florence, Rome, Naples, and Palermo, Italy May 25,1916 Branch at Petrograd, Russia July 5 1916 • Num- i Total ? "District. i befof I Capital. Surplus. resources. Subbranches at Moscow, Odessa, ; banks. ! Warsaw, Riga. Baku, Astrakhan, Vladivostok. Sevastopol. Hel- No. 1—Boston ! 13 '516,100,000 SI6,175,000 8348.578, (»52 singfors, and Vilna, Russia July 5,1916 No. 2—M ew York I 46 91,214,100 130,352,516 ;2,574; 779,252 No. 3—Philadelphia....! 7 . 8,050,000 19,660,000 ! 179,905,045 Branch at Lima, Peru July 31,1917 N N o o , . 4 5 — — C R l i e c v h e m lan o d n d ; 1 1 4 5 ! i 1 5 4 . , 0 1 4 5 0 0 , , 7 0 0 0 0 0. 4 3 5 , , 0 1 6 0 7 9 , , 9 5 0 0 0 0 3 4 4 3 6 : , 6 4 2 7 0 5 , , 9 69 6 7 0 Subbranches at Payta. Callao, and No. 6—Atlanta I 20 ; 9,860,000: 7,175,750 115,338,127 Mollendo, Peru July 31,1917 No. 7—Chicago ! 72 43,295,000 : 35,026.130 777,803,799 No. 8—St. Louis • 15.625,000 j 16.510)750 204,210,354 i Branch at Caracas, Venezuela July 31,1917 No. 9—Minncapolis I 16 i 227,700000,00000j '741,500 26,371,671 ! Subbranches at La Guayra, Porto No. 10—Kansas "City I 99 ii 33,000055.000000•' 2,308,000 65,522.041 : No. 11—Dallas....: 11 i 935', 000i 168,650 9,954:435 i Cabcilo. and Maracaybo July 31,1917 No. 12—San FraDoiseo..' 14 ! 2.820,000 1.538,250 53.641'. 094 Branch at; San Juan. P. R Feb. 13,1918 Total. 250 |212,854,800 232,888,946 |4",744.201,127 Subbranches at Avccibo, Mayaguez, and Ponce Feb. 13,1918 Commercial National Bank. Washington, State bank 'members of the Federal Reserve system up to B.C.: and including July 15, 1918. Branch at Panama City, Panama2 Jan. 12,3915 Branch at Cristobal, Gaual Zone2 Nov. 30,1914 First National Bank. Boston, Mass.: District. b N b a a u n r m k o s - f , ! j ] Capital, Surplus. Total Ame B ri r c a a n n c h F a o t r e B ig u n en o B s a A n i k r i e n s g . A C rg o e r n p t o i r n a a t ion, Jan. 29,1917 New York: No. 1—Boston 24 |*24,000,000 526,277,000 $517,051.789 Branch at Port au Prince. Kaiti Jan. 7,1918 No.a-Ncw York 70 :108,685,100 149,570,016 •:3,092) 653) 894 Branch at ilabana, Cuba Feb. 25,1918 No. 3—Philadelphia 16 I 14,900,000: 37)551,944 251,690,036 No. 4—Cleveland 35 i 23,435,000 54,874,500 503,660,933 Branches at Cristobal and Panama No. 5—Richmond 23 ! 7,585,700 5.088,400 77,584,641 City Apr. 2,1918 No. 6—Atlanta...: 40 1-1,720.000I 9)549,010 211,493,568 No. 7—Chicago 131 51,786i 000 41,503,000 032,030,958 Branch at Eio de Janeiro, Brazil July 23, 1918 No. 8—St. Louis 24 19.9S5.000 i 18,068,750 254,706', 614 Branch at Cap-Haitien, Haiti July 23, 1918 No. 9—ILinncaDolis 41 3i955,000 1". 333,000 50,877,299 No. 10—Kansas City 21 •i; 575,000'• 2,988,700 88', 909,221 Branch at Saint-Marc. Haiti July 23, 1918 N No o . . 1 12 1 — — S D a a n ll as F ranc . i ' sco.. 5 G 7 2 1 3 0 , , 8 1 2 20 3 , , 0 0 0 0 0 0' . 3 1 , , 7 0 3 4 6 8 , , 6 7 2 5 5 0 1 3 3- 7 1 , , 6 3 7 9 5 6 , ) 9 6 6 0 3 6 Branch at Oali, Colombia July 23, 1918 Total ! 544 J287.509.800 351.589,695 16,153.637,625 I ; Made an independent branch Dec. 8,1917. i j i I * Transferred to the American Foreign Banking Corporation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

736 EEDEEAL RESESVE BULLETIN. AUGUST 1,1918, The Mercantile Bank of the Americas has New York.—Chase National Bank. branches and affiliated banks as follows: Philadelphia, Pa.—Philadelphia National Bank. Pittsburgh, Pa.—The Bank of Pittsburgh, N. B. A. France—Mercantile Bank of the Americas (Inc.), 11 bis Portland, Oreg.—United States National Bank. Boulevard JEaussmann, Paris. Providence,, II. I.—Industrial Trust Co. Spain—Mercantile Bank of the Americas (Inc.), Ganuda Richmond, Va.—Merchants National Bank. 2, Barcelona. St. Paul, Minn.—Merchants National Bank. Peru—Banco Mercantil Americano del Peru, Lima, St. Louis, Mo.—National Bank of Commerce. Arequipa, Chiclayo, Oallao. San Francisco, Cal.—Anglo and London-Paris National Ecuador—Mercantile Oversea Corporation, Guayaquil. Bank. Nicaragua—National Bank of Nicaragua (Inc.), Mana- Springfield, Mass.—Springfield National Bank. gua, Bluefields. Leon, Granada. Tacoma, Wash.—National Bank of Tacoma. Venezuela—Banco Mercantil Americano de Caracas, Toledo, Ohio.—The National Bank of Commerce. Caracas, La Guayra; Mercantile Oversea Corporation, Utica, N. Y.—First National Bank. Maracaibo. Washington, D. C.—The Commercial National Bank. Brazil—American Mercantile Bank of Brazil, Para. Per- Worcester, Mass.—Merchants National Bank. nambuco. Colombia—Banco Mercantil Americano de Colombia, There is printed herewith the substance of a Bogota, Barranquilla, Cartagena, Mcdellin. Mercantile report furnished by the Mercantile Bank of the Oversea Corporation, Bogota, Barranquilla,- Cartagena, Americas concerning the operation of its for- Medellin, Girardot, Honda. eign branches. New Orleans, La.—Mercantile Oversea Corporation. Agencies in Bolivia, Costa Rica, Guatemala, Honduras. The Board prints this report in order to give the banks of the United States an opportunity Banks operating in the foreign trade under to familiarize themselves with what is being regulations of the Federal Reserve Board are done in foreign fields. The Board plans to as follows: Mercantile Bank of the Americas, invite the other banks operating in foreign New York City; American & Foreign Banking countries to -make similar reports and will Corporation, New York City; First National publish them from time to time. Corporation of Boston, Boston, Mass. The following is a list of banks which are The bank was started in 1915 with a small capital stock stockholders of the American Foreign Banking subscribed by Messrs. Brown Bros. & Co. and Messrs. Corporation and which have been granted by J. & W. Seligman & Co. The intention was to form a Pan-American bank, the gentlemen starting the bank the Federal Reserve Board authority to take being deeply interested in conferences that had taken such stock: place in Washington, and the general discussion that had Baltimore, Md.—Merchants-Mechanics Fir?;-; National been spread through the country concerning the need for Bank. foreign trade banks by the United States of America. Boston, Mass.—Merchants National Bank. Shortly afterward the following banks were added to the Buffalo, N. Y.—Manufacturers & Traders National Bank.j group at various times: The Guaranty Trust Co. of New Chicago, Hi.—Corn Exchange National Bank. • York: The National Shawmut Bank of Boston; The Anglo- Cincinnati, Ohio.—Fifth-Third National Bank. | London Paris National Bank of San Francisco; The Hi- Cleveland Ohio.—First National Bank. bernia Bank & Trust Co. of New Orleans, Dallas, Tex.—Security National Bank. The first foreign bank to be placed under the control of Denver, Colo.—Denver National Bank. the Mercantile Bank of the Americas was the National Detroit, Mich.—Peoples State Bank. Bank of Nicaragua. This bank had been formed in Grand Rapids, Mich.—Grand Rapids National City order that the currency situation in Nicaragua might be Bank. revised in accordance with the wish of tho United States Indianapolis, Ind,—Indiana National Bank. Government's State Department that some method be Los Angeles, Cal.—Merchants National Bank. devised whereby the currency of Nicaragua would no Louisville, Ky.—American-Southern National Bank. longer experience the vicissitudes it had heretofore expe- Milwaukee, Wis.—First National Bank. rienced. After consideraole labor the old currency was Minneapolis, Minn.—First and Security National Bank. finally taken up, a good part of it being burned, and the Minneapolis, Minn.—Northwestern National Bank. balance of it at the time of conversion being taken over Mobile, Ala.—The Peoples Bank. at the rate of 12J- to 1; namely, 8 cents in the new cordoba Newark, N. J.—National Newark & Essex Banking Co. ! currency for each peso of the old currency. The unit of Now Orleans, La.—Canal Bank & Trust Co. • value was the cordoba, value the same as the United Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL 'RESERVE BULLETIN". 737 States dollar. With the exception of a very short time, VENEZUELA. when the war between England and Germany commenced, The American Mercantile Bank of Caracas was opened this currency has been maintained at about parity, being about nine months ago in the city of Caracas. A branch the only currency in South and Central America which has been opened at La Guayra in order to facilitate the enjoys that distinction. At the present time the range movement of goods through the customhouse. A great of rates has been about 99 to 102. The National Bank of many merchants in America seem to think that if they Nicaragua is a Connecticut corporation, and its capital is send a sight draft with documents attached, the merchant §300,000, 51 per cent of its stock being owned by the in Venezuela (and for that matter in every country) Mercantile Bank of the Americas and 49 per cent by the can not obtain the goods unless he first takes up the draft Government of Nicaragua. Its board of directors consists and receives the documents. This is not so, and to the of representatives of the Mercantile Bank of the Americas, end that American merchants might be protected, arrangethe Government of Nicaragua, and the State Department ments have been made and announcements sent throughof the United States. out the country informing banks that the service of this The branches of the National Bank of Nicaragua are American Bank in Venezuela is at their disposal for the opened in Managua, Bluefields, Leon, and Granada. consignment of goods direct to the bank at the port of Bluefields is on the Atlantic coast, and strenuous efforts entry, La Guayra, provided that the sight draft with bills are being made by the bank to develop this part of Nicaof lading is forwarded through the bank for collection. ragua, which is mostly settled by Americans. To that end To large banks no charge is made for this service, on conclose connections are maintained between the Mercantile dition, of course, that they protect the bank in case the Oversea Corporation in New Orleans and its affiliated ingoods are not taken up by the purchaser. This facility stitutions and the National Bank of Nicaragua in Bluewould seem to remove one of the obstacles in the way of fields, New Orleans being the port through which most of development of trade, and, by the way, is only one of the trade must be cleared. The National Bank of Nicamany innovations that have been possible under this ragua is the only American Bank in Nicaragua. merchant banking system, which the Mercantile Bank of the Americas has installed in various parts of South PERU. America. This is a Connecticut corporation, and all the The American Mercantile IBank of Peru was established stock is owned by the Mercantile Bank of the Americas. about a year and a hall' ago at Lima. Since then branches have been opened at Arequipa, Chiclayo, and Gallao. It maintains an aggressive foreign trade department, em- The American Mercantile Bank of Brazil, with offices at ploying commercial men, and has become known as the Para and Pernambuco, was opened about six months ago. most active dealer in exchange, both sterling and dollars, This bank is not yet fairly under way, and the restrictions in Peru. on trade in rubber and other commodities by our Govern- The management of this organization consists of a board ment has resulted in this bank developing rather more of directors, whose formal meetings are held in New York, slowly than some of the others. In addition to that, it is and the executive committee of the board which meets in even more difficult to get banking men who understand Lima, Peru. This executive committee consists of three Portuguese than it is to obtain those who speak Spanish. prominent Peruvian gentlemen, and the use of their The capital of this bank is $500,000, all of which is owned names in that country in connection with our American by the Mercantile Bank of the Americas. This bank is institution there, has, no doubt, been extremely useful also a Connecticut corporation. to the bank, giving it a standing that it would not have otherwise secured so quickly. Exchange in Peru now COLOMBIA. shows New York funds selling at the rate of about 5.80 The American Mercantile Bank of Colombia has been against a parity of 4.86. The capital of the bank is, how- established within the last few months at Bogota, Barever, carried down on the books of the bank at about 4.80, ranquilla, Cartagena, and Medellin, and is the only bank, which is probably the worst that exchange would go in native or otherwise, with a system covering practically case of a reverse position alter the war. In view of the the whole country. The capital allocated to this bank is exchange situation and the possibility of there being a $500,000. This is a Connecticut corporation, and all of its scarcity of currency (which has now materialized) the stock is owned by the Mercantile Bank of the Americas. bank has kept a great deal of its deposits in foreign cur- Through the cooperation of the Federal Reserve Board rencies, and thus is in an extremely favorable position as and the Treasury Department, as our first important work compared to the other banks there, which have deposits we were able to protect New York exchange and bring in local currency almost exclusively, and whose position it from about 76 back to 96, merely by shipping gold to at this time is a rather difficult one, because of the fact that country. It has not been necessary for us to put it that the country has been drained o/ its gold, and currency into circulation in order to obtain the results reported. is extremely scarce. The capital of this bank is $500,000, The favorable sentiment created by our entrance, and all owned at present by the Mercantile Bank of the Amer- the measures taken by us to adjust the situation, have icas. evidently met with the approval of the people of Colombia. 72715—18 8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

738 FEDERAL KESERVE BULLETIN. AUGUST 1, 1918. A special session of Congress has been called, and is now branch to do much business. It is merely laying in session, considering proposals we have made for an the lines for service after the war to our Central, emergency currency there, in order to adjust the exchange South, and North American institutions. A branch of situation. We think that with very little help on the the Mercantile Bank of the Americas was opened about part of our Federal 'Reserve Board and the Treasury 'De- six months ago in Barcelona, and is the only American partment we shall be able to prevent New York exchange bank established in Spain. Because of the fact that from going against us as badly as it has in other countries dollars were at such a heavy discount in Spain, it was similarly situated. quite impossible for us to place the necessary amount of The Mercantile Oversea Corporation is a subsidiary of capital in Spain, at the disposal of the bank, with the the Mercantile Bank of the Americas, all of the stock result that an extremely difficult position arose. The being owned by them. It has full powers to trade and services of this branch have been offered to the Treasury to do any business that a merchant banker would do in Department, and it is hoped that they will appoint it- Central or South American countries. It is used to match depository and fiscal agent for the United States Governthe facilities possessed by the German and English bank- ment in Spain. This branch lias done some business ing and trade in these countries, and can deal for its own with the South American bank established in Venezuela account as a trading company whenever necessary. It whenever there was a possibility of shipment of mercan also put in cleaning plants for coffee, and similar chandise to Spain from that country. Absolute control machinery that may be necessary in order to secure a was thus provided in a small way of a supply of hold on the movement of trade for the United States of pesetas for use in this market. The services of this bank America, and for the American banks for foreign trade have been placed freely at the disposal of the Treasury established in the respective countries. In view of the Department, and the owners of the bank would not look difficulties of transportation and the fact that the great upon its services to the United States Government solely product of the country, coffee, was produced by small from the viewpoint of profits. farmers, it was necessary that some such organization The capital and paid-in surplus of the bank are should be installed in Colombia, and a couple of years $3,125,000, and the undivided profits approximately ago the Mercantile Oversea Corporation established 8300,000. The board of directors of this bank feel, reasonagencies in various parts of the country, before the estab- ably well satisfied with the progress that has been made lishment of the American Mercantile Bank of Colombia, in the extremely difficult situation, both as to men and with its offices at Bogota, Barranquilla, Cartagena, Medel- trade, that has existed. They have, however, bad in lin, Giradot, and Honda. Whore the bank is not estab- mind the development of this organization wherever there lished this corporation acts as its agent. It has also been were sources of raw materials to be had in South and Cenestablished in the town of Maracaibo, Venezuela. Prac- tral America for the use of our country after the war. tically a state of barter exists there, and the trade is Under their intensive system of going right back to the entirely in the hands of the Germans. There is not much planter himself and lending him money through a local to be looked for in the way of a bank in Maracaibo at the bank established in his own country, with a local statepresent time, and the Mercantile Oversea Corporation will ment published in his country, and with the cooperation therefore continue to try to work up a business until such of native directors, they feel that in spite of the numtime as it is possible to open a branch of the Caracas erous difficulties in attempting to establish a foreign-trade bank in that city. An office of the Mercantile Oversea bank for America in these days, the work done will prove Corporation has also been opened in Now Orleans, so that extremely useful to our country after the war. They also the orders received from people to whom we lend money hope that it will eventually turn out to be profitable. in the various countries adjacent to New Orleans may be The theory under which we work is that we shall obtain sent for execution to them. possession of the product for export at the earliest possible Agencies of the Mercantile Bank have been established moment—in fact, as soon as it is ready at the plantation— in Bolivia, where for the time being our own representa- and carry it from that point in our own possession until tive is located in La Paz; in Costa Rica, and in Guatemala such time as it is disposed of by the broker in Xew York and Honduras. or otherwise. The same is true of exports from the United It has been the policy of the Mercantile Bank of the States, when the goods are consigned to the bank. Americas to establish separate banks in each South or As soon as our manufacturers wake up to the need for " Central American country in which it operates. These foreign trade we are confident that this bank and its affilbanks are treated as if they were branches in respect to iated institutions will be in a position to put the American credit granted, but otherwise are quite separate and dis- exporter into closer touch with the actual buyer of the tinct corporations. In Europe, however, there is no goods in South or Central America than can be secured necessity for the establishment of separate organizations, through any other system. To that end we are building and a branch of the Mercantile Bank of the Americas was up our organization in foreign countries and not developopened about a year and a half ago in Paris. .Because of ing extensively in this country. We are preparing our war conditions and restrictions placed upon operations by lines abroad so that when American export manufacturers the French Government, it has not been possible for this are ready to sell their goods in foreign countries we shall Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 739 be in the strongest position to see that they are placed in German banks, the Banco Aloman Transtouch with the right people. Our banks in no case have atlantico with $21,000,000 and the Banco shipments of merchandise made for their own account, Germanico do la America del Sur with but they do every thing short of that in order to bring 811,000,000. The fourth group contains the buyer and seller together, relying upon their commissions to reimburse them. French banks, the Banco Frances del Rio de la In the i\e"\v York office there is a staff of about 150, and Plata with $14,000,000 and the Banco Frances T suppose that if those employed in the foreign field are e Italiano with $7,000,000. The fifth group added the total number of people engaged in this entercontains the Dutch bank, Banco Holand.es de prise would be in the neighborhood of 500. Compared to la America del Sur, with $18,000,000. a local bank or a bank doing the ordinary foreign exchange business, £1\Q overhead charges in connection with such an When it is recalled that the British banks enterprise as this are appalling. The only way in which have been in the South American field for this situation can be met is by incorporating in the one generations while the German banks have been institution all the elements that can be found in the there for approximately a generation, that the German system, which carries the goods from producer to branch of the First National Bank of Boston the source cf distribution, and receives the commissions, or a part of them, that are ordinarily paid for similar has been established only a .year, and that the services rendered by various parties under the old Ameri- branch of the National City Bank has existed can system. It is also a fact that under the old system only since the beginning of the war, there is German houses in New York-were established in order every reason to look with confidence upon the that their chain might be completed, and the sales comdevelopment of American banking in Argenmission for goods and services rendered, outside of mere financial charges, were sufficient when put together to tina. make it worth while for them to make loans, and thus Condition of principal Argentine banks, April, 1918. control business in South and Central American countries. We have already found it possible to call attention of [Argentine gold dollars.] borrowers in South and Central America to the fact that Actual naturally we would prefer that purchases be made in capital or p A l m ac e e r i i c n a , th if e i a r ll h a th n i d n s g . s are equal, with the funds that we Deposits. a c L n o d o u a n d n t i s s s . - C h a a sh n d o . n t s h p t a o o t n c t d h o i e r n r g e- Argentine Republic. There is printed below, as likely to be of interest, a list of the principal Argentine banks, Banco Alcman Transatlantico S20,776,739 812,228,092$11,387,492 63,050,000 stating their deposits as of April 30, 1918. This Anglo-South American Bank 24,723,050: 25,018.923 10,887,426 4,988,999 list shows that by far the largest deposits are British Bank of South j held by the local Argentine banks and by those America 29,951,216; 17.000,583 15,618,099 4,536,000 Banco Espanol del Rio which appeal directly to the Spanish-speaking do la Plata 103,612,2561103,442,410 24,573,832 43,253,029 Banco Francos c Italpopulation, and to the Italians, who form a iano 0,874,757! 11,066,595 6,095,629 13,998,940 Banco Germanico do la very largo percentage of the Argentine popula- America del Sur 11,233,189 7,571,224 4,038,420 1,729,000 Banco Rolando's do la tion. It is significant, however, that of the America del Sur 17,547,419 24,279,726 3,821,017 3,895,833 Banco Italia y Rio de la British, French, Dutch, American, and German Plata 51,929,963! 56,707,252 13,967,816 10,000,000 Banco Italo-Bclga 12,315, 7,465,587 3,102,633 1,000,000 groups of banks, the Americans now rank Banco do la Naeion 453,152,109;223,081,855 166,677,495 London and Brazilian 56,796,253 second in their holdings of deposits. The first Bank 10,230,456 5,992,402 4,534,068 2,126,190 London and River group consists of the British .banks, including Plate Bank 79,669,941 31,143,720 47,510,925 4,250,000 Banco Nuevo Italiano.. 25,687,986 21,005,230 7,843,007 2,200,000 the Anglo-South American, with $25,000,000, Banco Popular Argentine , 11,472,218 14,863,159 4,195,428 4,620,492 the British Bank of South America with Banco de la Provincia | do Buenos Aires | 106,585,847; 88,677,237 42,740,757 27,480,890 $30,000,000, the London & Brazilian Bank National City Bauk (B. | with $10,000,000, and the London & River A. Branch) 2l,161,946| 12,328,3 6,894,759 1,036,399 First National Bank, j Plate Bank with $80,000,000. The second B o s t o n (B. A. Branch) , 15,028,017 j 11,121,400 3,032,787 1,036,400 group contains the National City Bank with Frances del Rio de la Plata 14,059,6211 9,867,208: 5,820,260 2,500,000 $21,000,000 and the First National with Total of principal j I ! ! SJ.5,000,000.1 The third group contains the banks 1. 010,007,440 083,460,989:383.972,3921190,104.425 Total of all banks \\, Total of all banks for j 042,536,127j710,309,595391; 796,852J201,094; 059 1 The statement of Ma7 31, just at hand, shows $22,442,325 for the March, 1918 ! 973,001,766>06,557,058384,197,181^00,180,129 National City Bank and §17,691,651 for the First National Bank. i i I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

740 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. Lost Liberty Bonds. THIRD 4J PER CENT BONDS, DUE 1928-Continued. Following is a list of lost and stolen Liberty Number. Amount. Number. Amount. bonds furnished this month to the American 1701400 i 350 1616168 S100 1616229 $100 Bankers' Association: 1701107 j 50 1616167 100 1616230 100 1701108 ! 50 1616168 100 1610231 100 170M09 i 50 1616169 100 1616232 100 FIRST Si PER CENT BONDS, DUE 1947. 1701410 ! 50 1616170 100 1610233 100 1701411. 50 1616171 100 1616234 100 1701.412 50 1616172 100 1616235 i 100 Number. Amount. Number. Amount. Number. Amount. 1701413 50 1616173 100 1016236 I 100 1701414 50 1616174 100 1610237 S 100 1701415 50 1616175 100 1616238 I 100 1701416 50 1616176 100 1010239 100 381229 ... . S50 381233.. . . $50 1194845 S50 1701417 50 1616177 100 1616240 i 100 381231 50 381241 50 1701418 50 1616178 100 1016241 ! 100 381232.. 50 785241 . 50 1701419 j 50 1616179 100 101.6242 100 1701120 50 1616180 100 1610243 i 100 1701421 | 50 1616181 100 1016244 ! 100 1701422 I 50 1616182 100 1610245 I 100 FIRST 4 PER CENT CONVERTED BONDS, DUE 1947. 1701423 i 50 1616183 100 1616246 i 100 1701424 I 50 1616184 100 1616247 I 100 1701425 ! 50 1616185 100 1616248 ! 100 1701426 i 50 1616186 100 1616249 i 100 1701427 j 50 1616187 100 1610250 i 100 1701428 | 50 1616188 100 1610251 ! 100 1*01429 ! 50 1616189 100 1616252 ! 100 1701430 i 50 1616190 100 1616253 ! 100 SECOND 4 PER CENT BONDS, DUE 1912. 1701431 ' 50 1616191 100 1616254 ' 100 1701432 50 1616192 100 1616255 100 1701433 50 1616193 100 1616256 100 4 7 2 1 1 2 2 6 4 5 5 6 1 1 6 6 6 1 8 2 7 3 4 2 1 7 9 2 9 7 9 6 4 5 9 7 . . . . . . . . . .. .. . . . . . . . . . . . . . J " i j ! ! 1 IO 3 i 1 o $ 0 O 0 5 5 o 0 0 0 0 i 3 2 2 2 2 1 6 4 6 6 7 8 1 9 1 1 9 9 2 4 5 2 2 8 7 3 9 S 7 4 8 5 7 9 6 0 5 4 . . . . . . . . . . . . . . . .. . . . . . . . ; : ! ' i $ 1 1 1 1 i 1 o 0 0 0 0 0 0 0 o 0 0 0 i 3 3 3 3 4 4 4 4 9 9 9 9 4 4 4 4 3 3 3 3 7 7 7 7 f 9 7 5 t ! i ; j i §1 1 1 1 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 4 4 4 4 4 4 4 4 3 3 3 1 3 3 4 3 6 4 9 1 5 7 0 8 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 6 6 6 6 6 6 6 6 1 1 1 1 1 1 1 1 6 6 6 6 6 6 6 6 1 1 1 1 1 2 2 1 9 9 9 9 9 0 0 9 4 5 7 6 9 0 1 8 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 6 6 6 6 6 0 6 6 1 1 1 1 1 1 1 1 6 0 0 6 6 0 6 6 2 2 2 2 2 2 2 2 5 0 5 6 0 6 0 6 7 9 8 0 1 3 2 4 i i 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 8 8 7 7 7 7 7 7 7 7 3 3 0 0 0 0 0 0 0 0 5 5 1 1 1 1 1 1 1 1 4 4 2 2 2 2 2 2 2 2 0 0 6 6 6 6 6 7 6 7 7 8 6 5 4 8 9 1 7 0 THIRD $ 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 4} PER 1 1 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 7 7 C 0 0 0 0 0 0 0 0 0 0 1 E 1 1 1 1 1 1 1 1 1 . 3 3 3 3 3 3 3 3 3 N 3 1 1 1 1 1 1 1 1 1 1 3 1 0 2 7 9 5 4 8 T 0 BOND 5 5 5 5 5 5 5 5 5 5 5 S 0 0 0 0 0 0 0 0 0 0 , DUE 1 1 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 7 7 1 0 0 0 0 0 0 0 0 0 0 9 1 1 1 1 1 1 1 1 1 1 2 3 3 3 3 3 3 3 3 3 3 8 6 6 6 6 6 0 6 5 5 0 3 6 1 7 5 2 4 9 8 0 . $ 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 1 1 6 1 1 1 1 1 1 1 1 1 1 1 2 6 6 6 6 1 7 6 7 6 7 7 9 9 7 3 8 1 1 1 4 0 1 0 0 0 3 1 3 0 6 6 6 9 6 1 7 1 6 1 6 1 6 6 1 1 1 1 1 2 4 4 1 4 8 6 4 1 6 4 5 5 5 4 4 5 0 4 1 4 9 4 4 1 4 3 1 2 3 6 0 7 4 3 9 6 5 8 2 2 1 1 1 1 1 1 1 5 5 5 5 5 5 0 0 0 5 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 I j ; I I 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 1 0 1 1 0 1 0 0 0 0 1 1 1 0 0 4 3 3 6 5 5 6 4 7 9 1 2 0 2 8 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 6 0 0 0 0 6 0 0 6 6 0 0 6 6 6 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 6 0 0 6 0 6 0 0 6 6 6 6 0 6 6 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 6 7 6 0 7 0 7 7 7 7 7 7 6 7 7 6 1 7 5 3 9 9 5 4 7 0 0 8 2 8 { : i - 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 170L272 50 1701320 50 1701368 50 1616154 100 1616217 100 1610280 100 1701273 50 1701321 50 1701369 50 1616155 100 1616218 100 1010281 100 1701274 50 1701322 50 1701370 50 1616150 100 1616219 100 1843495 100 1701275 50 1701323 50 1701371 50 1616157 100 1616220 100 128676 500 1701276 50 1701324 50 1701372 50 1610158 100 1616221 100 128677 500 1701277 50 1701325 50 1701373 50 1616159 ! 100 / 1616222 100 128078 500 1701278 50 1703326 50 1701374 50 1616160 100 !! 1616223 100 128079 500 1701279 50 1701327 50 1701375 ! 50 1616101 lco ;, 1616224 100 37465 1,000 1701280 50 1701328 50 1701376 i 50 1616162 ioo ;; 1010225 100 37460 1,000 1701281 50 1701329 50 1701377 50 1616163 ioo i! 1616226 100 37467 1,000 1 1 1 7 7 7 0 0 0 1 1 1 2 2 2 8 8 8 3 4 2 5 5 5 0 0 0 1 1 17 7 7 0 0 0 1 1 1 3 3 3 3 3 3 1 2 0 . 5 5 5 0 0 0 1 1 1 7 7 7 0 0 0 1 1 1 3 3 3 7 7 8 9 8 0 5 5 5 0 0 0 1 1 6 6 1 1 6 6 1 1 6 6 5 4 1 1 0 0 0 0 j; I 1 1 6 6 1 16 6 2 2 2 2 7 8 1 1 0 0 0 0 1701285 50 1701333 50 17O1'581 50 1701286 50 1701334 50 1701382 j 50 1701287 50 1701335 50 1701383 | 50 If any of these bonds or coupons are pre- 1 1 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 7 7 0 0 8 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 9 9 9 9 9 8 9 9 8 9 1 3 7 0 5 9 2 4 8 0 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 7 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 3 3 3 3 3 3 3 3 3 4 4 3 3 3 3 4 4 1 1 3 6 7 8 9 2 4 0 ! , 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 7 7 7 7 7 7 7 7 7 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 . 3 3 3 3 3 3 3 3 3 8 9 8 8 8 8 9 8 9 6 1 9 7 5 8 0 4 2 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 g s t a e e t r c i n a o t p t i n e v h d , e , , N c D b o o a e l . l n p e 5 k c a t s N r , t m a t s o s h e s o L n a u u t . l d W A S m w t . r G e r e i e r a t i t m e c , , a m N n te o e l B n e w a , p n M h Y k o a o e n n r r e s k a , 7 g o C e A r r i s t P s t y e o r . l c o e i - - - 1701298 50 1701345 ! 50 1701393 50 1701299 50 17013415 ! 50 1701394 50 1701300 50 1701347 I 50 1701395 50 1701301 50 1701348 50 1701396 50 1701302 50 1701349 ! 50 1701397 50 New National Bank Charters. 1701303 50 |, 1701350 j 50 1701398 50 1701304 50 !l 1701351 I 50 1701399 50 1701305 50 |j 1701352 | 50 1701400 50 The Comptroller of the Currency reports the 170130C) 50 j 1*01353 j 50 1701401 50 1701307 50 1701354 50 1701402 50 following increases and reductions in the num- 1701308 50 1701355 50 1701403 50 1701309 50 1701356 50 1701404 50 ber of national banks and the capital of na- 1701357 1701405 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A17GUSX 1, 19.18. FEDSEAL RESERVE BULLETIN. 741 tional banks during the period from June 29, j Failures durino June. 1.918, to July 28, 1918. inclusive-— | Banks. j Number. Liabilities. New charters issued to 15 ! District. With capital of .. „ $965, 000 ' 1918 1917 ' 1918 1917 Increase of capital approved for 14 With sew capital of.-'- 1,260,GOO First 100 SI.584,608 ,991,194 Se?cnd 1-51 225 3,100,479 :, 822,125 Third <J3 49 . 707,654 531,037 Aggregate number of new charters and Fourth , 60 115 i 508,915 1,004,632 Fifth 43 82 i 619,73i 702,489 banks increasing capital.... 29 Sixth 35 88 :! 1.185,459 738,188 With aggregate of new capital authorized 2,225,000 S W ev t enth 12 4 9 0 14 7 1 7 [! ii ' 8 3 0 0 8 3 , , 1 2 7 0 G 2 !, 072,810 Number of banks liquidating (other than Niotii 38 45 !! 354.3GS 26^ 957 Tenth 30 48 II 147.397 551,495 those consolidating with other national Kioventh 33 66 •I 470.752 376,200 banks) , 0 Twoifth 102 151 ; 675,900 Number of banks reducing capital 0 Total. 804 1,186 ! 10,603,741 18,055,153 Total number of banks going into liquidation or reducing capital (other than those Conservation of Credit, co nsolidating with other national banks). 0 The foregoing statement shows the aggregate of The board of directors of the Federal Reincreased capital for the period oi the banks serve Bank of New York has adopted the embraced In statement was 2,225,000 Against this there was a reduction of capital following resolutions regarding the conservaowing to liquidation (other than for consoli- tion of credit: dation with other national banks) and reduc- It is clear that the increasing volume of Government tions of capital of 0 financing makes necessary a far more united and con- Net increase 2,225,000 sistent effort on the part of the bankers of the country to conserve and save credit than has heretofore been undertaken, The Federal Reserve Board, accordingly, on Commercial Failures p July 6, addressed a letter to all banks and trust companies requesting them to exercise "a reasonable dis- That the country's business mortality con- cretion to restrict credits -which are clearly not needed tinues to make a remarkably good showing is for the prosecution of the war nor for the health and demonstrated by the fact that only 578 com- necessary comfort of the people," and at the same time asked the Federal Reserve Banks in every practicable mercial failures were reported to R. G. Dun & way to bring about a better understanding of the necessity Co. during three weeks of July, against 779 in for the conservation oi credit: Therefore be it the same period of 1917, when the insolvencies Resolved, That the directors of the Federal Reserve were relatively moderate. The statement for \ Bark of New York, in full sympathy with the views of June, the latest month for which complete sta- j the Board, hereby direct the officers of the bank, in such tistics are available, discloses but 804 defaults ' ways as may be appropriate, to express to the banking institutions of this district the importance and necessity for 810,606,741, as compared with 1,186 in of conserving credit— June last year for $18,055,153. The present By endeavoring to secure such gradual reduction as figures make the best numerical exhibit, in fact, may be practicable of loans now carried for nonproductive of any month back to July, 1907, while the in- or nondistributive purposes; debtedness is the smallest in all months since By gradually reducing the amount of credit granted for purposes not clearly necessary for the prosecution of the May, 1910 Comparing with June, 1917, fails war or the health and necessary comfort of the peoures are fewer in number in all of the 12 Federal ple; and Reserve districts, except the first, where the By educating borrowers of all classes to keep their increase is trifling, and while the liabilities are demands for credit down to the very minimum. larger in the third, sixth, eighth, ninth, and Such a concerted compaign of action and education by the banking institutions of this district will surely lead eleventh districts, the expansion is not espeto a spirit of economy in credit transactions, as well as cially marked in any instance. On the other to an actual saving of credit comparable to the saving hand, the reductions are striking in several already effected in food and other commodities, and will cases, enable the Government to command the credit thus saved 7.2715-18 9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

742 FEDEBAL BESEBYE BULLETIN. AUGUST 1,1918. and use it directly and with full force for the winning DISTRICT No, 6, of the war. Trustee, executor, administrator and registrar of stocks and It is of the highest importance, however, that nothing bonds: should be done to cause undue embarrassment to bor- First National Bank, Tampa, Fla. rowers or affect necessary credits. .DISTRICT No. 7. Trustee, executor, administrator and registrar of stocks and Fiduciary Powers. bonds: First National Bank, Winamac, Ind. The applications of the following banks for permission to act under section ll(k) of the DISTRICT NO. 8. Federal Reserve Act have been approved since Trustee, executor, administrator and registrar of stocks and the issue of the July BULLETIN ; bonds: First National Bank, Mount Sterling, III. DISTRICT NO. 1. Trustee, executor, and administrator; Peoples National Bank, Barre, Vt. Acceptances to 100 Per Cent. DISTRICT NO. 2, Since the issue of the July BULLETIN the Registrar of stocks and bonds: following banks have been authorized to accept First National Bank of the City of New York. drafts and bills of exchange up to 100 per cent First National Bank, Paterson, N. J. of their capital and surplus: DISTRICT NO. 5. First National Bank, Seattle, Wash. Trustee, executor, and administrator: First National Bank, Philadelphia, Pa. First National Bank, Chatham, Va. Fort Worth National Bank, Fort Worth, Tex. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,19.18. FEDEBAL EESEEVE BULLETIN. 743 INFORMAL RULINGS OF THE BOARD. Below are reproduced letters sent out from member bank are used to carry or trade in time to time over the signatures of the officers obligations of the United States, such note complies with the requirements of the statute or members of the Federal Reserve Board to the same extent as the note of any other which contain information believed to be of person, firm, or corporation executed for a general interest to Federal Reserve Banks and similar purpose. On" the other hand, if the member banks of the system: proceeds of a note of a nonmember bank are not used to carry, or trade in, obligations of Eligibility of Note of Nonmember Bank Used in Trading the United States, but are used by the bank in In Government Obligations. the conduct of its ordinary business, the note (To an individual.) is not eligible for rediscount even though indorsed by a member bank. The Board has, in connection with its coun- The question raised in the present case is sel, given careful consideration to your letter whether" or not a note of a member bank, the of the 6th instant and to the question raised proceeds of which have been used or are to be therein. You wish to know "why there should used to carry, or trade in, United States oblibe a discrimination against the member banks gations, is eligible for rediscount when acquired in the case of notes secured by liberty bonds ? and indorsed by another member bank. With our indorsement, we can discount a 90- In the opinion of counsel, with which the day note secured by Liberty bonds given by a Board concurs, if the proceeds have been used, nonmember bank, while no paper secured in or are to be used in this way, the principle inthat way given by a member bank can be disvolved is the same, whether the note is execounted if drawn for longer than 15 days, cuted by a member or by a nonmember bank, Some explanation of that apparent discriminaand where such a note has been acquired in tion we shall appreciate. May we ask if you good faith by a member bank, it should be consider a. 90-day bank note, secured, by Liberty eligible for rediscount with the indorsement of bonds and taken in the ordinary course of the member bank. business, as ineligible later when offered for discount by this bank and indorsed by them?" JULY 18, 1918. Section "13 of the Federal Reserve Act, in substance, provides that notes, drafts, or bills of exchange having a maturity not to exceed Rediscount of Notes Used for Draining and Tilling Farm 90 days, are eligible for rediscount with a Fed- Land. eral Reserve Bank by a member bank, if the (To a Federal Reserve Bank,) proceeds of such notes, drafts, or bills of ex- Your letter of June 21 has had the attention change have been used or are to be used for a of the Board, commercial, agricultural, or industrial purpose, You ask whether farmers' notes given for the or for carrying or trading in bonds and notes purpose of draining and tilling their farms is of the Government of the" United States. eligible for rediscount by a Federal Reserve The proceeds of a note executed by a non- Bank as agricultural paper. niember bank could not be said to have been The Board is of the opinion that such notes, used or to be intended for use for a commercial. the proceeds of which are used for tilling farms, agricultural, or industrial purpose, since the should clearly be classified as agricultural paper business of the bank does not come within any and that this is true ordinarily of notes the of these classifications. proceeds of which are used for draining the Where, however, the bank is authorized un- farm. It is conceivable, however, that cases der its charter to carry, or trade in, bonds or may arise in the reclamation of swamp lands notes of the United States, and. its note exe- where such lands could not be treated as farm cuted for this purpose is acquired by a member land until expensive drainage systems have bank, the Board has heretofore ruled that such been installed. In such case there is doubt of note would be eligible for rediscount with a the eligibility of the notes, the proceeds of Federal Reserve Bank when indorsed, by the which are used for this purpose. Where, howmember bank. In other words, the Board has ever, the land drained is already in use as farm held that where the proceeds of a note of a non- land, the draining may be treated as incidental Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

744 FEDERAL RESERVE BULLETIN. AUGUST 1,1913. to the cultivation of the land, and notes given tures, being those of the acceptor, the drawer, for such purpose may be rediscounted as agri- and the indorser. cultural paper, JULY 12, 1913. JULY io, 1918, Authority to Act as Guardian. Indorsement of Acceptances. (To a Federal Reserve Bank.) (To a Federal Reserve Bank.) Receipt is acknowledged of yours of July 11 I have your letter of July 3, in which you inclosing copy of a letter from the Nainquire whether all acceptances should be intional Bank of asking whether that bank dorsed in order to insure that the instrument is authorized to act as guardian of estates under "bears evidence of title." authority of permit granted it by the Federal Acceptances must bear the signature in Reserve Board. blank or to order of the last party to whom the In reply you are advised that the Board is acceptances has been indorsed, but if the acwithout" authority to grant to national banks ceptance is indorsed in blank it can. of course, any fiduciary powers except those enumerated change ownership from one holder to another in "section 11 (k) of the Federal Reserve Act, without being indorsed by each subsequent viz, the power to act as trustee, executor, adholder, and the title would pass all the same. ministrator, and registrar of stocks and bonds. As a matter of better protection, purchasers There is an amendment pending before Conof acceptances generally* have the acceptance gress extending the authority of the Board so indorsed to their order, thus insuring'themas to include guardian of estates and other selves against their being collected or disposed fiduciary powers, but this amendment has not of by others than the legitimate owner. In yet become law. that case, of course, the holder has to indorse the bill. Where the purchaser is not quite JULY 16, 1918. certain as to the genuine character of the signatures on the bill, he would, of course, be well Basis for Figuring Interest for Discount Transactions, advised to insist upon indorsement by the seller. (To Federal Reserve Banks.) In England the habit is general to indorse It is desirable to maintain uniformity in acceptances freely, and, as you know, I am figuring interest in rediscount transactions bevery much in favor of establishing a similar tween Federal Reserve Banks, and as it has practice here. As a matter of fact, in Now proved most convenient in the purchase of York we have progressed so far that out of acceptances to use interest tables based on 360 about 8120,000,000 of acceptances held by the days to the year, the Board has decided that New York Federal Reserve Bank, only about these tables should be used in all rediscount $3,000,000 were unindorsed according to its last transactions between Federal Reserve Banks, statement. and has therefore revoked its previous ruling I hope we may soon reach the point when that the basis of 365 days to the year should Federal Reserve Banks can make a definite be applied, as announced in its circular letter rule not to buy bankers7 acceptances except dated January 31, 1918. such as bear at least three responsible signa- JULY 9, 1918. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUOKST 1, 1918. FEEEKAL EESEEVE BULLETIN. 745 LAW DEPARTMENT. The following opinions of counsel have been maturity, is a valid negotiable instrument, a bill drawn authorized for publication by the Board since for a fixed sum "with collection charges" is not a negotiable instrument unless it is so drawn as to show that no the last edition of the Bulletin: collection charges are to be included unless the bill is Indorsement "Without Recourse." dishonored at maturity. JULY 10, 1918. If a note is otherwise eligible for rediscount, the fact SIR: The accompanying letter raises the that it Ix-i&rs a "without recourse" indorsement of a nonquestion whether a draft or acceptance made incmbor bank vrill not affect its eligibility. payable with attorneys7 fees or with collection JULY 3, 1918. charges, could be treated as a negotiable SIR: The accompanying letter from the instrument. chairman of the board of a Federal Reserve Reference is made to an opinion published Bank asks "Should the Federal Reserve Bank accept for rediscount notes from its members on page 880 of the November, 1917, BULLETIN, to the effect that a bill payable with collection which bear 'without recourse' indorsement of charges is not a negotiable instrument, and nonmember banks V attention is called to the fact that this opinion In the opinion of this office if the notes are is apparently at variance with an opinion pubotherwise eligible the fact that they bear lished on page 226 of the May, 1916, BUL- ''without recourse'5 indorsement of a nonmern- LETIN, in which the conclusion was reached ber bank would not affect their eligibility. that a provision contained in a bill to pay the Under the Negotiable Instruments Law a costs of collection and attorneys7 fees does not qualified indorsement constitutes the indorsor invalidate the instrument. a mere assignor of the title to the instrument. In the case considered in the earlier opinion, It may be made by adding to the indorser's signature the words ''without recourse77 or any the provision to pay the costs of collection and attorneys7 fees obviously related to costs inwords of a similar import. Such an indorsecurred in collecting the bill, provided it was ment does not impair the negotiable character dishonored at maturity. In other words, the of the instrument. sum to be paid at maturity was a sum certain The Federal Reserve Bank would accordand the drawee ^could obtain a full discharge ingly acquire a good title to the instrument by paying this amount. In the latter case, when rodiscountod by a member bank whether the bill was drawn for a fixed sum with collecor not it bore the indorsement ''without retion charges. That is to say, the amount to be course'7 of a nonmember bank. paid at maturity was not a sum certain, but If, therefore, the note would be eligible was the sum named in the bill, plus whatever without the indorsement of the nonmember the collection charges might amount to. bank it would be eligible with an indorsement In the opinion of this office, therefore, the '{without recourse.77 form to be adopted should not contain the .Respectfully, language "with collection charges,77 unless M. C. ELLIOTT, Counsel the bill is so drawn as to show that no collec- ToHox. W. P. G. HAIIDIXG, tion charges are to be included, unless the bill Governor, Federal Reserve Board. is dishonored at maturity. Respectfully, Bills Payable with Attorney's Fees cr Collection Charge0. M. C. ELLIOTT, Counsel. While a bill containing a provision for payment of the To Hon. W. P. G. HARDING, costs of collection and attorney's fees, if it is dishonored at Governor, Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUMMARY OF BUSINESS CONDITIONS, JULY 23, 1918. District. b G us e i n n e e r s a s l . Crop condition. Industri t e ri s c o t. f thedis- | | Con a s n t d ru e c n ti g o i n n , e b er u i i n ld g. ing, Foieign trade. Money rates. conditions. No. 1—Boston I Active Good Busy i Small Improved. Increased Mixed ! Unsatisfactory. No. 2—New York..! Activity limited Fairly good. Intensively active Heavy decreases, ex- During fiscal year | Firm: ruling rate Post office. June re- : "Work or fight'7 j only by short- on war work. cept on Govern- ending Juno 30 (> per cent. turns increase over • order and Fed- I ace of raw ma- ment work. i in p o r.t s d e- ! 1917; telegraph, = eral control of terials. creased 7 per j quarterly ' returns employment of cent, exports 14 . j increase over 1917. unskilled workper cent. j ers somewhat relieves shortage. No. 3—Philadelphia! Very good Very good Very busy j Building at lowest Shipment of war i Continue firm j Increasing Shortage in all j mark for a decade. supplies c on- i j lines. I tin.!!os heavy. j j i i j No. 4—Cleveland...: Satisfactory j Good Active Inactive. ! Very firm j Increase •vScarce: somewhat unsettled. No. 5—Richmond.. Active and prof- ] Unusually favor- .Running to capac- Private building neg- Restricted by hick j Firm; 6 percent...: Railroad. irregular; Some s::ight imitable. • able. ity: limited only ligible; Government of freight room. I post office, volume provement reby labor and sup- housing active. Tarce; reflects in- ported. pftes. s ! creased rates. i No. 6—Atlanta ! E xcoUcnt Good Verv active Light, except Govern- Very light i Slight increase j Slight increase Verv unsatisfacment work. tory. W cj No. 7—Chicago | do | Very good Generally at capac- Stagnant I Firm j Post-office receipts in- Insufficient s u p - I ity. crease. ply- No. 8—S t. Louis... G ood ! Fa vorabl e Active Quiet. .do. Decrease in post office More settled. receipts. No. 9—Minneapolis. do : Good. : do Fair ! do No change. Good. No. 10—K a n s a s do ! do ! do Generally restricted I' r a f t i n a 11 y Scarcity more pro- City. to essentials. i unchanged. nounced. No. 11—Dallas Satisfactory. : Fair do Below normal Good Unchanged; Railroad., i n c r e a s o; Unsatisfactory on o o n s i ci ering | steady to firm. post office, 52.7 per account of shortsummer sea- j cent increase. age. sou. No. 12-—San Fran- Active Good ."... Very ac ti vo. Decreased 29 per cent Large vo! i i.mo Firm Increasing ' Settled. cisco. from last month, I but 16 per cent greater than Juno, 1917. CD GO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDEBAL BJBSERVE BULLETIN. 747 GENERAL BUSINESS CONDITIONS. There is given on the preceding page a sum- Cotton mills are sold well ahead and are mary of business conditions in the United running at as near capacity as labor conditions States by Federal Reserve districts. These will permit. Pending price fixing is holding reports are furnished by the Federal Reserve the market steady and quiet, with both buyers agents, who are the chairmen of the boards of and sellers awaiting further developments directors for the Federal Reserve Banks of the before entering into new commitments. Efforts several districts. Below are the detailed re- are being made to restrain workers from taking ports as of approximately July 28: too many vacations, thus slowing up production. The question of financing and handling DISTRICT NO. 1—BOSTON. the new cotton crop is coming to the front, and The scale of wages paid to skilled labor has it is hoped that some plan may be evolved increased rapidly during the past year, being wherein7 the crop can be moved over an exaccompanied by advances in the cost of tended period, rather than rushed to market at the opening of the cotton year. living and causing a considerable revision of our social standards. This has brought for- The National Association of Wool Manuward, as purchasers of luxuries and high- facturers reports both worsted and woolen priced goods," artisans who heretofore have mills running full time, with over 50 per cent been comparatively poor, and restricted the of their capacity engaged on war orders. manner of living of salaried workers and per- While manufacturers are .making such fabrics sons with a fixed income whoso increased as they can from the raw material on hand, expenses, due to high prices, have been out of there is no sign of any considerable amount of all proportion to the increase in their income. wool becoming available for civilian purposes The readjustment of these conditions after the in the near future. Taking into consideration war and the return of properties now under the substitutes that are being used and the Government control promises to furnish an reworked wool, it is not likely that the supply interesting chapter in the history of the of goods for civilian use will be much less than Nation. the minimum requirements and there are indications that dealers are fairly well supplied with The general labor situation is unfavorable, both woolen and worsted goods. There is no and even where operatives are employed on trading in raw wool, the Government's control Government orders increased demands and becoming even more firm. The latest evidence strikes are prevalent. of this condition is the announcement that In this district, barley, rye, and buckwheat after July 28 no licenses for the importation show big acreage increases and are growing of wool from Argentina, Uruguay, or South well. June frosts hurt corn, leaving it on an Africa will be issued for the remainder of the average between 75 per cent and 82 per cent year except to the Quartermaster General of of normal. The growing condition of wheat the United States Army and that those outand oats is excellent. The hay crop is about standing will be revoked. 82 per cent of normal and pasturage is about The leather market is quiet, awaiting the 11 per cent below normal. The weather has final decision as to the price of hides for the been unfavorable for harvesting hay, which three months period from August 1. Labor is an important crop in this district, and troubles are seriously interfering with the protherefore the yield may be materially less than duction of shoes in all the principal New Enganticipated. Gardens, except where damaged land centers, naturally causing an unsettled by frost, are growing well, as is the tobacco feeling in the trade. The shoe industry on the crop. New England fruit crops are very light. whole is quiet. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

748 FEDERAL RESERVE BULLETIN. AUGUST I, 1918. The money market is firm, with banks re- posits on July 20, 1918, totaled $14,949,000, stricting loans to their own customers and even as compared with $15,475,000 on June 22, then discriminating wherever possible against 1918, and $36,204,000 on July 21, 1917. those borrowing for less essential purposes. The amount "Due to banks" on July 20 Business men and the public generally are co- 1918, was $123,353,000, as compared with operating fully in avoiding competition with $125,823,000 on June 22, 1918. the Government for loans. DISTRICT NO. 2—NEW YORE. The Federal Reserve Bank of Boston has been called upon for rediscounts to a consider- The growing accomplishments of industry in able extent, its loans at present (July 22) being meeting war needs are daily becoming more $116,000,000, as compared with $68,000,000 on definite and apparent. Production for civilian the same date last month. Call and time money purposes, on the other hand, is necessarily are on a flat 6 per cent basis, with practically somewhat restricted in proportion to the reno exceptions. The commercial paper market duction of reserve stocks of raw materials. is quiet, with the same rate prevailing. The Government, with the cooperation of the industries concerned, is extending its super- The exchanges of the Boston Clearing House vision over available current supplies with a for the week ending July 20, 1918, were view to their equitable distribution. Retail $336,790,952, as compared with $268,002,273 trade shows in some measure the season's for the corresponding week last year and normal dullness. $330,430,117 for the week ending July 13, 1918. Shipbuilding continues to make substantial Building and engineering operations in New progress. In this district 9 shipyards are England from January 1 to July 17, 1918, practically complete and 8 others more than amounted to $77,902,000, as compared with half completed, including 60 shipways for $111,064,000 for the corresponding period of steel and 33 for wooden ships. Present con- 1917. tracts are for 284 ships of total dead weight The receipts of the Boston post office for tonnage of 1,593,020 tons, of which 49 (tonnage June, 1918, show an increase of $93,001.74, or 171,500) are to be of wood and the rest of about 13 per cent more than June, 1917. For steel. On July 4 four steel and five wooden the first 15 days of July, 1918, receipts were ships were launched. about 31 per cent, or $96,273.02, more than Other construction work to meet Governfor the corresponding period of last year. ment need is heavy. The total value of The Boston & Maine Railroad reports not building permits, however, in the larger cities operating income, after deduction of taxes, for of the district (except Jersey City) has de- May, 1918, of $589,360, as compared with creased from the corresponding month last $818,820 for the corresponding month of 1917. year, the decline in greater New York being For May, 1918, the New York, New Haven 57 per cent for the month, and the change & Hartford Railroad reports operating income, for the six months nearly the same, as compared after deduction of taxes, of $1,600,384, com- with 1917 figures. A large part of such pared with $2,069,803 for May, 1917. general building activity as there is consists of Loans and discounts of the Boston Clearing alterations and repairs. House banks on July 20, 1918, amounted to Deliveries of iron and steel for war purposes $481,565,000, as compared with $503,058,000 are being made satisfactorily under the priorilast month and $471,388,000 on July 21, 1917. ties certificate arrangement, with the prices Demand deposits on July 20, 1918, amount- of the second quarter of the current 3^ear coned to $424,263,000, as compared with tinued for the third quarter. Conferences $460,834,000 on June 22, 1918, and have been held between the Government and $369,589,000 on July 21, 1917. Time de- iron and steel makers with a view to regulation Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL BESERVE BULLETIN. 749 of the distribution of steel rails, wire rope, that accumulated stocks of raw materials steel and malleable castings, and miscellaneous which have up till now enabled production to steel products, which, unlike steel plates and be maintained, are being exhausted, and reshell steel, will probably be available to some plenishment is interfered with by restrictions extent to private consumers. on imports, shortage of labor and transpor- The fuel situation continues to occasion con- tation, and by Governmental requisitioning of cern, as unfilled orders are considerably in ex- products essential to the war. The volume of cess of stocks in sight. Reports of the Regional ordinary trade, however, partly because of Director of Railroads indicate a material de- rising prices, compares very favorably with cline in the imnmer of cars loaded in the four the volume in the first six months of 1917. weeks following June 15 as compared with the A large part of the output of the underwear loadings in the four weeks preceding that date, and hosiery mills is being taken by the Govthough the number of cars dumped at "New ernment, and the woolen goods which are being York piers. 28,648 cars of anthracite and 27,369 manufactured are almost entirely for Governof bituminous coal, shows a moderate increase ment purposes. An agreement of producers over the earlier four-week period when 26,307 with the War Industries Board to sell cotton and 26,233 cars of anthracite and bituminous, linters only to the Government has resulted respectively, were dumped. in decreased yardage of cotton goods /for The hydroelectric power generated at Niagara civilian trade, and because of extremely high Fails is being distributed under Federal direc- prices for lower grades of cotton cloth there tion, 85 per cent of the output of the two were very few transactions for some time prelargest companies having been requisitioned ceding the expected Government fixing of for plants producing war essentials, and 54 prices for these goods, which finally occurred per cent of the output of all the companies on July 8. The rates then announced were being utilized for war purposes. Considera- from 20 per cent to BO per cent lower than the tion is being given by representatives of the highest current values for sheets, print cloths, Government and of the petroleum industry to and duck. The fixing of yarn prices is also the elimination of competitive premium pay- expected, with probable stabilizing effect on ments for preferential delivery of crude oil prices of raw cotton. and to keeping distribution of the available Fur pelts continue to sell freely at advanced supply in the present channels. Production prices, the Government having come into the is far short of the capacity of the refineries, and market as a buyer of skins for use in aeroplane shortages of gasoline, kerosene, and fuel oil equipment. Buyers for western retail estabduring the next six months seem likely though lishments have begun to arrive in New York more new crude oil wells with larger capacity City in considerable numbers, preparing for were brought into play during June than in the autumn trade. Summer business in the any previous month except June, 1916. dry goods and clothing lines has been rather Other basic material industries have been the dull because of continued cool weather. subject of Governmental action designed to In order to control sugar distribution, it is increase production, copper prices having been understood that a Government corporation advanced from 234 to 26 cents per pound, and known as the Sugar Equalization Board is to cement plants, the output of which in the be organized under New Jersey charter. New eastern territory has been below normal, York consumers were allotted 75,000,000 having been given a degree of preferential pounds of sugar for July under a certificate treatment in fuel distribution. system in effect July 1, giving the less essential Manufacturers of rubber and leather goods, consumers only from 50 per cent to 70 per paints and varnishes, drugs and chemicals, cent of their normal consumption, this curetc, appear to be in a similar position in tailment having been necessary because of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

750 FEDERAL RESERVE BULLETIN. AUGUST 1.1918. limited amount available for consumption in mally crowded at this time of year are not half the United States during the next six months. filled, and the stores have felt the effects of Farming conditions warrant the expectation war-time econom ies. While it is anticipated of large crops, though unusually cool weather that the red uction in the one-day excursion at this time of the year has retarded the rates will result in more visitors at the shore growth of grain and small vegetables in some resorts, there seems to be little inclination sections, and has also been detrimental to theamong the majority of the people to go away fruit crops. for any extended time. Many, who formerly Corporate securities issued in June amounted went to the seashore or mountain resorts for to $253,786,800, compared with only the better part of the summer, are remaining $59,637,400 in 1917, and were the largest for in or about town. any June except 1912, This was due princi- The shipyards and war industries in the vipally to a few very large issues, and between cinity of Philadelphia are absorbing workmen 30 per cent and 35 per cent of the total was from all points. This condition has created a for refunding maturing obligations. Similar severe shortage of rentable property and many figures for the first six months of this year families are. having difficulty in finding suitable show a 27 per cent decrease from those in 1917. housing. Real estate agents, who usually had The estimated total dividend and interest dis- large numbers of houses for rent, now advertise bursements for July increased 2 per cent over that, owing to the unprecedented demand for 1917, but dividend payments decreased 18 houses, their rent lists are exhausted. This per cent and the net increase was due tostringenc}^ is not being relieved materially by heavy increase in payments of interest by the new home construction, as building is still quiet. Federal and city governments. Money rates Difficult}' in obtaining financial accommodahave been very firm, ruling at 6 per cent for tion and high costs and scarcity of materials call money, time loans on stock exchange col- and labor continue to operate as restrictive faclateral and commercial paper. tors in the building industry, which generally is at the lowest mark for a decade. DISTRICT NO. 3—PHILADELPHIA. The freight-car movement over the Pennsyl- Notwithstanding the shortage of supplies afvania Railroad at Lewistown Junction is of fecting practically all lines, marked activity in record-breaking proportions, the figures for general business continues. This is natural, in June being as follows: view of the wage advances and the consequent increase in the spending power of the Nation. : Loaded. Empty. I Total. Owing to unusual conditions arising from the rigid prosecution of war policies, there have Eastbound 92,174 2,435 I 93,609 been some lines, of course, which have been Westbound ; 19,018 90,997 ! 110,015 unfavorably affected. In the case of most Total I 111, 102 92,432 ! 203,624 kinds of merchandise demand is in excess of supply. Midsummer influences are not very Eastbound bituminous coal shows an innoticeable. crease of 27.2 per cent over the month of June, Retail distribution, including men's and 1917, while westbound miscellaneous fell off women's wearing apparel, has recovered from 27.6 per cent. Total car movement increased the setback due to unseasonably cool weather, 4.5 per cent. but there are many indications on the part of The iron and steel market continues.to be the public to limit buying to staples and actual dominated by Government orders. The indusnecessaries. try, helped by cool weather, continues to make Business at the south Jersey seashore resorts an unexpectedly good response to the call, for has been very quiet. Hotels which are nor- more steel, and is now operating almost to full Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,191S. FEDEEAL RESERVE BULLETIN. 751 capacity, even the smallest factories being able ation of all grades is proceeding at a rapid to obtain all the orders they can handle. Pro- pace. Inquiry for yarns in anticipation of a duction of plates and shapes has been excep- revival of the civilian knitting activities in the tional during the past few months. The Ameri- fall has disclosed a pronounced scarcity of these can International Shipbuilding Corporation, materials, with prices strong. There is an inwhich complained not long ago that its work at creasing shortage of woolen goods, and the Hog Island was being seriously retarded by trade in this line, as in cottons, reflects the inlack of steel, has announced that steel is arriv- fluence of impending price regulation, although ing in ample quantities. The general testimony conditions have steadied somewhat, owing to of iron and steel producers is that the system official assurances that enough wool is in sight of control of deliveries, as inaugurated some- to provide for all military and civilian needs. time ago, is working quite well, and many con- Prospects of early sown crops have faded cerns in this district have not yet materially somewhat, owing to the prolonged diy weather, changed their method of handling orders as a but the shading of estimates thus rendered is result of the July 3 statement of the War In- not material. The berry crop is very short and dustries Board, which granted to the producers in some places is not more than 25 per cent of the right to accept certain orders without normal. Prices are high. The potato crop has priority certificates. been hurt, but tomatoes, which are helped by The production of anthracite coal is not up a reasonable amount of dry weather, are reto the maximum owing to the depletion of ported as very good. The acreage is large. labor through the operation of the selective Hay and rye are being harvested and crops are service law and the inducement offered in the heavy. The labor supply has been short all form of higher wages by other industries. One year, but the work seems to have been done, authority reports that the anthracite fields most of the large farms being equipped with alone are short approximately 33,000 men who the latest labor-saving machinery. have been drafted or drawn away by war in- Much surprise has been expressed that dustries. This great shortage of labor is com- Lancaster County's new tobacco crop has pelling the operators largely to suspend normal shown such good growth in spite of unfavornew development work in order to free miners able weather conditions, being fully two weeks for the work of producing coal for the market. ahead of the crops of the past few years. The Dealers in many localities are far behind in de- fields planted in May, which far exceeded the livering even two-thirds of their customers7 re- number planted in that month for many years, quirements for the year. The shipments for arc developing more rapidly than the fields of June, as reported to the Anthracite Bureau of the June planting, an incident that many Information, amounted to 6,867,669 long tons, older planters had believed could not be poscompared with 7,049,037 tons in June, 1917. sible. The factories are operating at capacity. There has been a marked improvement in The demand for all forms of tobacco is showthe car supply in the bituminous fields. Pro- ing so steady an increase that in numerous duction for the week ending June 29 amounted instances night shifts are necessary. Heavy to 12,340,000 tons, the highest in the history movement of our troops overseas has increased of the industry. the demand, particularly for cigarettes. The uncertainties of price-fixing negotiations The money market has remained firm., at have caused some withholding of purchases in 6 per cent, during the past month. The cotton goods. The demand far exceeds the market has been freed from much unnecessary supply. financing by the Capital Issues Committee Fleece wools are leaving the hands of the and the banks have responded to the war needs growers in much larger volume, and the valu- of the Government by curtailing their credits Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

752 FEDERAL BESERVE BULLETIN. AUGUST 1,1918, to nonessential industries. Business on the and a shortage still exists. Sheet mills now local stock exchange has been dull, although have orders for months ahead. Tin-plate there is a continued absorption h^y investors mills are very busy and believed to be operof high-grade railroad securities. ating at almost full capacity. Blast furnaces Bills discounted for member banks by the continue to maintain their production. The Federal Reserve Bank during June amounted usual midsummer dullness has not yet affected to $92,825,910, a record figure; bills redis- the iron and steel trades to any appreciable counted for other Federal Reserve Banks extent. amounted to $2,238,350; acceptances par- Window glass and brick manufacturers rechased, $4,882,526; total discounts and open- port little change from previous months. Due market purchases. $104,289,787, compared to priority orders, embargoes, etc., the output with $85,531,840 the preceding month. Of of these lines is very much decreased and some the bills discounted for members, $64,877,529 trouble is experienced in keeping organizations were secured by United States bonds or certi- intact for work when it is possible and perficates of indebtedness. The average daily mitted. However, little complaint is made amount of Earning assets held by the bank and a disposition is shown to make the best of during June was $77,315,535, and the average the situation. Taking into account the adverse annual rate of return was 4.2 per cent. conditions which affect these industries, their, Total discount and investment operations business is fairly satisfactory. during the first half of the year amounted to Potteries are busy and conditions surround- $402,780,168, compared with $107,753,637 for ing this industry show betterment, There is a the same period last year and $329,743,478 for steady and well developed demand for pottery the entire 12 months of 1917. Gross earnings products which exceeds production. The diffifrom such operations amounted to $1,252,946 culty in getting shipments of raw materials for the first six months of 1918, compared with which existed some months ago has now been 1316,042 for the corresponding period last removed, and materials are now readily reyear, and $987,057 for the entire year 1917. ceived in quantities and at times equal to the needs. Clay products for building purposes . DISTRICT .NO. 4—CLEVELAND. and sewer pipe are curtailed and business in Throughout this district a gradual change is these lines suffers through discrimination and noted in the manner of conducting business. lack of activity in the lines of trade to which New criteria have been set up and precedents they cater. are disregarded. Fuel.—The larger operators report that this Manufacturing.—Steel and iron production lino is in much the same unsatisfactory state in still continues at high pressure. Mills are which it has been for the past year; that they readily adapting themselves to Government are unable to produce normal tonnage by reason regulations, and, while the scope of activity of inadequate transportation facilities and unamong the larger manufacturers has been satisfactory labor conditions. However, after considerably narrowed, yet the demand is giving preference to Government and priority •undiminished. So far this summer the cool orders, regular customers are fairly well taken weather has been favorable to the mainte- care of. In the outlying districts there have nance of the volume of output. This is par- been larger expenditures for the development ticularly true in steel mills, where the exces- of the industry than ever before in its history sively hot weather tends to decrease produc- and production in these places has been greatly tion. The Government is using the greater increased. The demand is very strong and the part of the output of steel bars, but the docks at the head of the lakes show but little demands of implement makers are also taken accumulation. In a few quarters in the care of. The market for pig iron is narrow smaller manufacturing centers a fair stock is Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 758 reported. Apparently preseason plans are in trying to organize this field. It is believed going forward as arranged, but the fuel situa- that except in the case of coal the output of the tion still gives concern and demands conserva- larger and more important industries has not tion in order that the current needs may be been seriously affected by shortage. The crops met. are being harvested and soon all fear of danger Agriculture.—At this writing the wheat crop from labor shortage in that quarter will be for the year has been harvested over the greater allayed. part of the district, and in a great many locali- Collections.—Contrary to expectations, in ties the yield is reported to be the best in years. view of the heavy Government demands in the In two instances large fields are said to have past month, collections are generally reported averaged 37 i bushels and 41 bushels per acre, good. In only an occasional instance is found respectively. In one quarter grain is reported cause for complaint due to local conditions. light in weight, reducing the returns per acre. On account of the higher prices much more It is believed that there are very few places in money is needed to carry on business, and this which the yield will not be well up to the aver- of itself is thought to tend to restrict credit to age. The harvesting of oats is now progressing the financially responsible. rapidly, and it is expected that this grain will Transportation.—Complaint of shortage of also yield a bumper crop. Weather unusually cars and lack of transportation in the larger cool for the time of year and the pretty" general centers of mining and manufacture continues lack of rain in the district have to some extent to be registered, while in many others the damaged the prospects for the corn crop. It service is giving satisfaction. Generally it is is said that, with good rains and seasonable believed that there has been quite an improveweather, it is not yet too late for this crop to ment, and, while delays and shortages are still recover. Generally throughout the district reported, the car supply appears to be fairly early potatoes have suffered from lack of sufficient for needs, and deliveries are more moisture, and the yield is not nearly what it prompt than in the past months. should be. It is expected that the late pota- Merca/nMe lines.—Jobbers and wholesalers in toes will do much better. Vegetable crops all lines report a good demand and sales in and fruit conditions are generally satisfactory, good volume at profitable figures. Price fixing but if this condition is to continue it will require on cotton goods is said to have caused some rain followed by warmer weather. The acreage friction, but it is believed this action will have in burley tobacco is much better than usual, its intended effect and stabilize prices. Some and timely rains have put it in such condition difficulty is reported in contracting for next that a good crop is almost assured. Indica- spring's goods. In the retail lines merchants tions are that prices will be high, even though report good business, especially in manufacturthe yield is greater than heretofore. The ing centers where high wages are paid, but harvesting of the hay crop is almost completed even in these places a tendency to economize and is large. The yields of clover and alfalfa more than usual is shown, and in a few localiwere especially heavy this year. ties there is said to be a slight falling off in Labor.—Throughout the district there is business not altogether due to the season. considerable difficulty in securing a supply of Money and investments.—The past month has labor. This is especially true in the large been noteworthy in that payments on submanufacturing and coal mining centers. It is scriptions to the third Liberty loan have been generally described as of poor and uncertain made and taxes paid in amounts that call quality. In the Kentucky coal fields labor is attention to a financial system that can finance reported in sufficient quantities and unusually such payments without the least disarrangecontented and satisfied. Some apprehension ment of business. The demand for money is is felt on account of the action of union men very strong and bankers are showing more Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

754 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. firmness in discriminating between classes of North Carolina and Virginia, with good crops, paper which are offered, the governing factor will follow promptly in turn, and in a few being the purpose for which the proceeds are weeks returns will be flowing into the banks. to be used. The banks in the larger centers Railroad facilities are reported as improving, are, with commendable spirit, cooperating with with assurance of continued progress in this the smaller banks in canning districts in ex- direction. Labor continues a problem, but tending credit to such canning companies as conditions are no worse; some slight improveare able to show a satisfactory financial condi- ment is noted; women and boys are being requition. Contrary to expectations the invest- sitioned and every effort is being made to proment market is thought to have held its own mote efficiency. in comparison with previous months. Reports of manufacturers, dealers, and Building.—Generally there is very little tradesmen continue favorable, even optimistic, activity in the line and, except in localities and industrial activity is limited only by labor where Government work has necessitated the and supplies. Details would be but a reiterabuilding of additional homes to take care of tion of what has been reported for weeks past. the housing needs of employees, a decline is Conditions are summed up tersely by one corshown. Speculative building has been cut to respondent who says, "This is no dull summer the minimum. In numerous instances acute for anybody/' scarcity of housing facilities is reported, but Banking conditions are sound and profitable. this condition is believed not to exist to such Loans have reached the largest volume ever a degree as to seriously interfere with produc- attained, but agriculture, which is the paration. mount factor in the district, requires long credit for nature to do its work, and with high DISTRICT NO. 5—RICHMOND. values this condition is a natural and unavoid- Payments on Liberty loan subscriptions are able sequence. Production and marketing will being financed and made without a ripple, and restore the equilibrium. though the district is reaching the peak of its DISTRICT NO. 6—ATLANTA. credit load for its crop period, the Government certificates of indebtedness have been sub- For the past 30 days there has been a great scribed for with liberality by many of our scarcity of moisture throughout the district, banks. Few of them are able to make sub- and a careful examination and analysis of scriptions without rediscounting with the reports received indicate that while cotton Federal Reserve Bank, but this has not de- and corn have withstood the drought fairly terred those who appreciate their duty from well, unless general rains prevail in a short lending their credit by subscribing and then time both crops will be considerably damaged. rediscounting. The nights have been cool and the days warm Crops as a whole are the best in years, due and windy, making most unfavorable cotton allowance being made for deterioration in some weather. In general the cotton crop is in a of them and some spotted conditions. Food healthy condition, the bolls appear to be deproduction has increased to a marked degree veloping normally, and the plants though and the district has purchased less food from small are fruiting well. The boll weevil, reoutside than ever before. ported in many sections early in the season, Tobacco promises another good yield, high does not seem to have done any material prices seem assured, and the monetary return, damage, due to the hot dn^ weather. Barring as was the case last year, will run into millions. probable damage from these pests the cotton The South Carolina markets have opened at crop will be the largest in several years. an average of 30 cents a pound, and the crop of Corn has suffered in many sections. Howthat State is estimated at 75,000,000 pounds. ever, a considerable part of the crop was not Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL EESEEVE BULLETIN". 755 put in until April and May, and these plantings lack of transportation facilities, uncertainty are still in condition to give good yields. For of labor, and high cost of materials. the State of Mississippi the condition on July 1 The shortage of farm labor has been growing averaged 86 per cent of normal, indicating a instead of diminishing, but the farmers have production of 77,572,000 bushels, compared made supreme effort to meet the demand for with 84,050,000 for 1917 and a five-year increased production. The cultivation of inaverage of 58,633,000. Tennessee showed 90 creased acreage is being accomplished by per cent condition c ompared with 89 per cent longer hours, intensive farming, less holidays, last year, and average condition of 87 per cent, less interest in the usual summer political or 99,297,000 bushels, compared with activities, and a return to the fields by farmers 111,150,000 in 1917, the acreage being slightly who had heretofore given up active service reduced. Florida shows about 10 per cent in the fields. The shortage will no doubt be increase over last year, with indicated pro- more seriously felt at harvest time. duction of 15,536,000, compared with Receipts of turpentine at Savannah, Pensa- 13,875,000 in 1917. In Alabama the esti- cola, and Jacksonville from April 1 to July 1 mated acreage planted to corn is 4,680,000 were 54 per cent short, compared with the same compared with 4,825,000 last year and an period last year, while receipts of rosin showed average condition of 88 per cent as compared a shortage of 45 per cent for the same time. with 78 per cent in 1917. Georgia upland corn This shortage resulted in a sharp advance in has suffered considerably, but lowland crops the prices of both, rosin and turpentine. There are good to excellent and are earing well. The is a shortage of labor, high wages are decrop has been laid by except in the north. manded, and the cost of production is greatly Louisiana corn has deteriorated decidedly as a increased. Practically no new naval stores result of the drought, some sections reporting were opened this season, and a shortage of 40 the entire crop as being lost. per cent in production is looked for. The tobacco crop of Florida shows an increase Recent advance in the prices granted" by the of about 50 per cent in acreage and is in un- Government to the manufacturers of lumber usually fine condition, indicating a yield of put them in a position whereby they should get approximately 5,000,000 pounds. In Tennes- reasonable prices for their stumpage and be see tobacco is late and growing slowly, but is able to make a profit. Until the advance of generally healthy. June 15 the lumber manufacturers were ex- Fruits are in good condition, truck crops and periencing considerable difficulty, because the vegetables fair, white potatoes good, and sweet price of Government material had been made potatoes doing well. The peanut crop looks about eight months prior, whereas prices of fine, and sugar-cane crops of Louisiana and labor and materials had been steadily ad- Florida are good to excellent. All crops are vancing since that time. The cut is not over badly in need of soaking rains. 75 per cent of the cut in normal times, due, Winter wheat is mostly thrashed, with primarily, to the scarcity of labor. average results. It is about time for pitching There was some falling off in bank deposits the fall crops, but owing to continued scarcity owing to the unusual demand of customers to of labor these are not expected to be normal. meet assessments growing out of the new The crop of citrus fruits last year amounted revenue'laws of the Government. The falling to 13,000 carloads, or about 5,000,000 boxes off was only temporary and deposits are showof oranges and grapefruit. It is estimated ing steady increase. Demands for money are there will be an i ncrease of about 50 per cent steady and rates are slightly increased, tending this y ear. Notwithstanding the increase, it is thereby to decrease demands for funds for expected higher prices will prevail, owing to "honessentials." Banks are endeavoring to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

756 FEDERAL RESERVE BULLETIN. AUGUST i, 1918. aid the Government in the curtailment of non- 88, to a condition estimated at 55 and 74. essentials, and in this work the Capital Issues Wheat forecast for the entire five States in this Committee for the district is meeting with district is 137,000,000 bushels. success in discouraging expenditures. Bank Corn looks good in all States and is said to clearings show satisfactory increase and are require only warm weather. Heavy rains and still above normal at this season of the year, the accompanying winds boat down oats in and banks are in a healthy condition. many localities, but in general yield is promis- Trade conditions throughout the district are ing. Barley, hay, and rye are in excellent excellent, and the demand in most lines con- shape. tinues to exceed the supply. Collections are Interesting figures have come to hand from reported good, and merchants express the the report of the dairy and food commissioner opinion that ultimately it may result in doing of the State of Wisconsin for 1917. It is business on a more strictly cash basis. shown that the value of dairy products for this All industrial fields report great activity, State increased about $80,000,000 between especially in the Birmingham coal and iron 1915 and 1917 and that during 1917 the value district and in cities where shipbuilding is under of dairy products reached the total of $190,way, as well as in towns and cities containing 235,817.72. It is said Wisconsin manufactures Army camps. Work is rapidly progressing at one-sixth of the butter and one-half of the the new Government nitrate works at Sheffield, cheese produced in the United States. Ala., and the Government powder plant at Live stock is extremely high priced and Nashville is expected to be in operation about meats are correspondingly high. There is a August 15. Approximately 30,000 men are j heavy domestic demand, but export requireemployed at this plant. j ments are known to be satisfied for some time The people are thoroughly awake to the seri- to come, as there are heavy accumulations ousness of the war and are practicing more abroad. Brisk .trade is reported in packers' economies. Though there is but little idleness by-products, hides, glue, fertilizer, tallow, and in the district, the labor shortage grows more grease. Receipts of live stock at Chicago for serious. the four weeks ending July 20 as compared to a like period in 1917: DISTRICT NO. 7—CHICAGO. One of the most encouraging features of the Cattle. ' Calves. ! Hogs. Shecpi situation in this district is the practical assurance of a bumper crop of wheat. Corn, oats, 1918 i 240,560 ; 40,675 | 546,722 1917 i 188,328 ! 42,016 ! 471,775 j 226,976 rye, and barley, fruit, and vegetables are in good condition generally. Weather has been The money market is firm. Contributingunusually clement, with certain exceptions, factors are the strong demand for money from where frost, drought, excess rain, or storms industrial enterprises and the absorption of caused local damage. Wheat harvest is pro- available resources by purchase of Government gressing. Illinois and Indiana are apparently obligations. The rate is hard at 6 per cent in the lead with a forecasted crop of better with an upward tendency. Very little comthan 100,000,000 bushels between them. The mercial paper is being sold in Chicago, only condition on June 1 of Indiana and Illinois one large bank having made purchases in any wheat was 97 and 95, respectively, a remarkable volume. In the country the situation is betterment of the 10-year average. Iowa held practically the same and bankers do not expect about even with condition at 85 against a 10- to be in funds until the fall and winter. ycar average of 84. Michigan and Wisconsin, The effect of price fixation on the leather both visited by killing frosts, show a falling off industry and dry goods business as told by from the 10-year average, respectively, 81 and correspondents is conducive to a healthy and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 757 stable condition and is generally welcome. the cities report brisk trade, and country Thus far the price-fixing committee has ad- dealers look for a large business in the fall on justed only the price of harness leather, with account of crop prospects. Stocks in hands of the promise of a decision on sole leather in retailers are said to be ver}" large, dry goods, the near future. Uppers will no doubt soon grocery, hardware, furniture, musical supplies, come under consideration with a view to re- and jewelry stores having bought heavily vision. The hesitation observed in commit- against a rise. Wholesalers in the abovements for futures in cotton goods has prac- mentioned lines report that sales are ever on tically vanished with the establishment of the increase and that in general there has been prices 20 to 30 per cent below current quota- an increase both in value as well as in units tions on sheetings, print cloth, and cotton involved. It is said that certain hardware duck as bases for proportionate reductions in and dry goods lines are broken and will not other cotton textiles. be replaced. A noteworthy tendency to elimi- Control of the distribution of wool, steel, and nate nonessentials from stocks is observed by iron and the restriction on the use of sugar wholesalers in their dealings with their retail and fuel by certain industries and for certain customers. Buying power is probably greater purposes has in the main resulted in the ina- than it has ever been. bility of the firms employing these materials Most of the large automobile manufacturers to take care of civilian demand. Manufac- are engaged with trucks, tractor parts, mine turers of clothing, sweaters, woolen socks, and anchors, Liberty motors, and airplane bodies gloves anticipate a great scarcity in the months and will not suffer from limitation of the to come and clothiers state that an increasing passenger-car output. Some furniture manupercentage of cotton must be used in wearing facturers have contracted to work on airplane apparel. The diversion to Government uses construction. Packers arc working to caof iron and steel increases the difficulty with pacity to fill United States and allied Governwhich hardware and piano manufacturers, con- ment and civilian demands. Tanners are struction companies, and automobile manufac- working on large Government orders and are turers obtain raw material. Passenger-car compelled to turn away orders daily. Steel makers will be allotted only 25 per cent of companies have only the United States as a normal needs and the War Industries Board customer. estimates this will enable them to build 500,000 Building and construction have shown no cars in the coining year. Brewers and malt- gains which would justify hope for a satissters can obtain only 50 per cent of their cus- factory future. Building permits and values tomary fuel supplies, which will cut production involved in 15 cities for the month of June show to about that percentage. Confectioners re- a considerable reduction over June, 1917, and port a cut in sugar quota from 80 per cent to a slight reduction as compared with May, 1918. 50 per cent, and in order to maintain volume June, 1918, permits total 2,488, valued at of output arc turning to products requiring a $9,307,535 against a year ago, when these figminimum of sugar. ures stood, respectively, at 3,230 and $10,967,- Trade and manufacturing have never been 423. better. Most manufacturing plants are work- Due to the condition of building and coning full time and could turn out more work if struction, recited above, the lumber business material and labor were available. Transpor- is still in unhealthy shape, there being no contation facilities are ample and there is con- sistent, dependable demand. There is some siderable evidence of heavy shipments of goods call for boxing and crating. being made now to avoid the congestion of the Labor is extremly scarce and migratory, berails when crops begin to move. Retailers in ing attracted to localities where wages are Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

758 FEDEEAL RESERVE BULLETIN. AUGUST 1,1918. highest. Competition for labor has pushed The condition of the cotton in Arkansas, wages to unreasonable heights. The situation Mississippi, Missouri, and Tennessee was estiis constantly aggravated by the induction of mated by the Government on June 25 to be young men into the service. 92 per cent, which is 10.8 per cent better than Authorities differ regarding the prospects for the 10-year average and 7 per cent better than coal supply next winter. It has been said that the May 25 estimate. Boll weevil complaints coal users have in many cases supplied im- are less frequent, and on the whole the crop is mediately current needs and are laying in re- making good progress. serve stock. In other quarters there are mis- The weather during the past month has been apprehensions regarding a shortage for the ideal for harvesting and thrashing, and reports coming winter. We hear that civilians will be indicate that good results have been obtained. put on coal rations, limiting its use as fuel to an The yield and quality of winter wheat generally amount sufficient to heat houses to 68°. are said to be excellent. It is reported to be Clearings in Chicago for the first 18 business coming to market in large volume. The hardays of July were $1,582,000,000, being $42,vesting has cleared much land, and already 000,000 more than for the corresponding 18 many farmers are plowing for the next winterbusiness days in July, 1917. Clearings rewheat crop. This work is being materially ported by 21 cities in the district outside of helped by the increased use of tractors. Chicago amounted to $341,000,000 for the first There has been little change in the general 15 days of July, 1918, as compared with $268,business conditions in this district during the 000,000 for the first 15 days of July, 1917. past month. Industries generally continue Deposits in 12 central reserve city member active, especially those contributing articles banks in Chicago were $829,000,000 at the necessary for the prosecution of the war. Iron close of business July 20, 1918, and loans were and steel manufacturers are working to capacity, $634,000,000. Deposits show a decrease of as are also manufacturers of boots and shoes. approximately $41,000,000 over last month Difficulties in obtaining supplies for civilian and loans an increase of approximately $27,use are increasing, and this is having a deterrent 000,000. effect on "noncssential" industries. Some DISTRICT NO. 8—ST. LOUIS. lines are also being affected by the fact that Until the latter part of July the growing many new undertakings, such as road buildcrops in this district were suffering from lack ing, street paving, construction work, building, of sufficient rainfall. This condition was etc., are being postponed until after the war. greatly relieved toward the end of the month Department stores and retail merchants by general rains throughout the district, which generally report a good business and say that materially benefited the corn, cotton, and collections are good. The reports indicate that other crops. retailers are buying cautiously and only for The condition of the corn in the States in- their needs. cluded in this district was estimated by the Labor is well employed in this district, and Government on July 1 to be 86.3 per cent, there is a good demand for both skilled and which is 1.6 per cent better than the 10-year unskilled workmen. With the aid of Federal average. It was estimated that the acreage mediation, practically all strikes have been planted in the States in this district would settled, and there is very little labor unsettleyield 1,145,959,000 bushels, which is somewhat ment in this district. below last year but more than the 5-year aver- On July 11 anouncement was made that a age. As a rule, the fields are well worked, and Government barge line would be established if there is proper precipitation there will doubt- on the lower Mississippi River. The Governless be a large corn crop in this district. ment had previously arranged to provide barges Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN". 759 for the upper Mississippi, so that the use of the The eastern half of North Dakota, and the Mississippi River from St. Paul to New Orleans greater part of South Dakota, the State of for the carrying of freight is now assured. This Minnesota, and all of Wisconsin, show an is expected greatly to relieve the transporta- extremely good crop outlook. During the tion situation in this district, and thereby mate- middle of the month this area was threatened rially to benefit business. with damage from dry weather, and in central The demand for money continues good Minnesota there were spots here and there in this district, and the bank rate to customers where the wheat was beginning to give indicaremains unchanged at 6 per cent in the large tions of approaching a stage that would have centers and slightly higher in the outlying brought serious injury. Opportune rains exdistricts. However, as a rule, the banks are tended over all of this area, and the greater liberally subscribing to the Government short- part of it received a drenching downpour, which term certificates and also taking care of their has given sufficient moisture to mature the crop, which practically guarantees, particularly in commercial requirements. When necessary, eastern North Dakota, Minnesota, and eastern they are rediscounting with the Federal Reserve South Dakota, very heavy yields of all grains. Bank. The commercial paper market is still below Wheat in this particular area is uncommonly normal, but a slightly increased demand from good, and the fields show an unusual evenness some of the country districts has recently of stand and plant development. Minnesota's been noted. Practically none of the banks in wheat crop is likely to be larger than the State the large cities are in the market for commercial has ever before produced, and there will be a paper. The rate prevails at 6 per cent for all large production of barley, rye, oats, and flax, names and maturities. although barley and oats do not run quite as evenly and do not show quite the same uni- DISTRICT NO. 9—MINNEAPOLIS. form good quality as wheat. The cutting of General rains did not come early enough to rye is general in the eastern part of the district, prevent severe injury to the small grain crop and the barley harvest has begun. The hay throughout the northern section of Montana crop, which is a very important item, is generand in parts of western North Dakota. In ally good throughout the eastern half of the central and southern Montana the outlook is district, although there are some localities still good, although in the central portion of where forage crops are short. the State conditions are more or less spotted. Money and banking conditions are prac- The loss in the northern counties, which are tically unchanged, and business conditions in chiefly given over to grain raising, is very un- general show comparatively little change. The fortunate, but will not necessarily prevent a process of restricting unnecessary credits is satisfactory total production in that State, making good headway without interference due to the fact that where , there is a crop the with necessary business activities, and progress of the campaign to encourage economy in yields will be large, and due also to the fact public and private expenditures is encouraging. that in the favored section the acreage is heavy. Municipalities and counties in particular have The same spotted condition applies pracshown a praiseworthy spirit, and an immense tically to all of the western half of North amount of construction and other public work Dakota. Many fields, particularly those that has been deferred until the close of the war. have been carefully cultivated, will obtain very While the crop losses in the western half of good yields of all small grains, but in various the district are unfortunate, there is strong districts where the rainfall was insufficient, or promise of a satisfactory harvest for the district where rains did not come at the right time, as a whole, and of prosperous conditions during the yields will be very small. the fall and winter. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

760 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. DISTRICT NO. 10—KANSAS CITY. Owing to the prolonged drought the oats crop Agriculture.—The wheat harvest opened in in Kansas and Nebraska has deteriorated conthe Southwest under ideal weather conditions. siderably during the past month, indicating a The continued heat wave caused a spontaneous much decreased yield. The remaining States and unusually early ripening throughout most in the district, however, report prospects genof the district, and although the damage re- erally good. ported in some parts has been balanced to a June weather conditions were very favorable certain extent by increased yields in more for corn, and through careful cultivation the favored localities, the aggregate returns are crop is now generally in a fine condition, well less than previously estimated. Though the fortified against a moderate siege of drought. harvest was early, arrivals of new wheat at Thus far little serious damage has been remilling centers were about one week later than ported. Rain is needed throughout the dislast year, due to the suspension of activities trict, and July precipitation will decide the before July, awaiting new wheat regulations. crop yield. Indications at this time point to The supply of wheat at the four principal record crops in the principal corn-growing markets in this district decreased two-thirds regions. Receipts of corn for the month on during June, accompanied by a reduction of the local market reached the highest point one-third in flour production at the mills. The since 1914, an increase of 58 per cent over the weekly flour output decreased steadily, the same month last year, while shipments intotal for the month being 40 per cent under creased 38 per cent. that of the corresponding period a year ago, Live stock.—The cattle producers in the the mills averaging but 14 per cent of capacity southwest territory responded liberally to the as compared with 37 per cent last year. calls of the Government for increased produc- The milling industry has been decidedly quiet tion, as reflected by the record-breaking rein June, for the customary heavy bookings at ceipts of cattle and hogs at the five principal this time in advance of a large prospective crop markets of the West for the first six months of were prohibited by the order of the Food Ad- this year. Sheep receipts do not show a ministration restricting sales for shipment be- corresponding increase, but a notable improveyond July 1. Domestic demand for both old ment is expected shortly. and new wheat flour was strong, but scarcity For the past month the movement of live prevented domestic business. Receipts and stock to the principal yards has apparently shipments of wheat on the local market were, been up to current requirements, though cattle respectively, but one-tenth and one one- receipts decreased 8 per cent under those of hundredth of those for June, 1917. June last year and dropped slightly under those The almost complete exhaustion of supplies of the preceding month. Hogs increased 11 and the resumption of competitive activities per cent in numbers at the markets during resulted in a heavy demand for first wheat. June when compared with 1917, but decreased Large premiums were paid over the Govern- about one-tenth under last month's figures. ment guaranteed prices, permitting only the They averaged 5 pounds heavier than a year most efficient mills to make a profit, and it is ago. Twice the number of hogs were sent to reported some Hour was actually marketed at market by means other than the railroads this a loss. These premiums are not expected to June than the same month last year. Most of continue long but will probably last until a this increase is probably due to improved motor large stock of grain is accumulated. The huge transportation facilities. Sheep receipts were crop and looked-for reduction in wheat substi- practically the same this month as last and tutes predict a large and continued milling de- registered an increase of 29 per cent over the mand for the near future. corresponding month a year ago. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 761 The conditions and outlook for live stock The month of June showed some improvecontinue satisfactory. Although Kansas and ment in the Missouri-Kansas-Oklahoma ore Oklahoma fields are in need of rain, ranges in market. Average prices of zinc for all grades general are good and are reported to be carry- advanced over those of the previous month, ing a more than normal number of beef cattle. while lead prices averaged 9 per cent higher The exceptional prices paid for beeves induced than in May. Improved conditions in the a movement of grass-fed cattle to the markets lead market resulted in an increased producearlier than usual and the average weight of tion for the first six months of this year of offerings was under that of previous years. As about 3,000 tons, and producers anticipate a further improvement the remaining half year a result of the favorable grazing conditions; if present prices are continued. however, it is to bo expected that heavier cattle will later be offered. Stocks of hogs on the Production of zinc in 1916 and 1917 increased farms are reported to be slightly over normal more than the demand for ore, and a slump in Prices of cattle and hogs ruled very high prices ensued. It is now believed that the during the month, while sheep quotations zinc industry is at the lowest point in the declined. Sheep prospects are good and stock- cycle, needing only a stimulant to start an yards expect a record run within a few days. upward swing. Surplus stocks are double Shearing is generally completed throughout those of Juno last year and increased 1,000 tons over May. As a consequence, mine Colorado and Wyoming, where the wool is owners have cooperated of late in curtailing said to be of good quality. production, with the object of reducing the Mining.—The coal situation is becoming surplus ore and accelerating the advance in more critical and the solace of an optimistic prices recently initiated. future is lacking. Colorado, in response to the request for an increased coal output over Oil.—It is exceedingly gratifying that the 1917 of 1,500,000 tons, has produced a surplus growing demand for oil and oil products is of but 40,000 tons for the first six months. being answered by a substantial increase in The Missouri Valley States, comprising the supply from the fields. Eecent operations offer good grounds for the belief that with seventeenth fuel zone, report a deficit at the economy the needs of war as well as various end of June of 50 per cent of the amount stated other needs will be fully met. by the authorities as absolutely necessary to In the half year just closed there were meet requirements of last year's magnitude. almost 50 per cent more completions in the The necessity is obvious of lessening consump- Oklahoma oil fields than in the same period tion to the utmost and of avoiding all unnecesa year ago, yielding an additional producsary waste. tion of about 25 per cent. The fields have As predicted, the mining industry of Colorado been extended considerably over the limit failed to revive in June, so the usual activity of 1917 and some of the pools of that period did not prevail. The recent readjustment of have been since further developed. The Kanprices of lead, zinc, and copper stimulated sas fields are now producing more oil than ever production, however, with the result that the before and both completions and new producoutput is greater than before. Production tion were about double that of the first six of the more common metals is expected to be months of 1917. Wildcat operations were maintained at about 75 or SO per cent of normore general, and twice the number of dry wells mal. were reported over last year. The marked decrease in gold mining as Field operations in the Mid-Continent region shown by figures of the first half year has for June were far above the monthly average caused much notice of late. The lowered for the past two years. Completions set a purchasing power of gold has permitted only new high record, but new production did not the richest mines to continue operation. quite come up to the mark. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

762 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. Wyoming had a record increase in produc- increased buying by retailers is expected. tion of almost §0 per cent over May, and the Difficulty in securing desired materials conend of June saw more wells drilling than at tinues to be prevalent. Demand is reported any time in the history of the State. June to be good and above parity with production. completions numbered one less than for May, The volume of construction for June in the but only four dry wells were reported against principal cities of this district decreased oneten for the preceding period- fifth under June last year, and while the esti- Kansas had 44 more completions in June mated cost of such construction was practhan in May and an increase of one-eighth in tically the same the tremendous rise in buildnew production. Total production increased ing costs must be kept in mind in making 35 per cent over June, 1917, and 9 per cent comparisons. The outlook for building trades over last May. Oklahoma was not so fortu- is not changed and the ratio of decreased nate, however, and although there were about domestic business following augmented war 200 more completions than in the preceding demands is expected to be continued for some month, new production for the six months time. ending June decreased about 6,000 barrels, Labor.—As the war progresses, the shortage or 14 per cent, as compared with the output of labor is being felt more strongly in the west for the six months previous. Also the total and southwest. Successive drafts, in which production decreased 12 per cent under that are, of course, included many skilled workmen, of June a year ago and 6 per cent under that leave vacant places that are becoming inof May, 1918. creasingly difficult to fill. Due in great meas- Lumber and construction.—Building opera- ure to the work of the Government agencies tions are characterized by the absence of and the cooperation of the public, the despeculative enterprises. Present construction mands of the harvest have thus far been sucis only that which is identified with the progress cessfully met and the few shortages reported and successful outcome of the war. Com- were quickly remedied. The top wages which mercial building is generally restricted to have been paid everywhere attracted mobile absolute necessities. The domestic work is labor from the oil fields and the mines. This largely that of remodeling and enlarging, exodus of men in addition to the preexisting although there is considerable school and conditions occasioned much difficulty in atresidence building. It is problematical whether tempting to maintain a constant production the seasonal demand for construction in the and a number of properties were forced to rural districts will come up to anticipations, close down on this account. The oil districts for although the harvest will be satisfactory, lack trained men experienced in drilling operafarmers are going to make all available use of tions, while the mines are in special need of their land for next year; and this work, along shovelers. with the great scarcity of artisans, may prevent Labor troubles have increased slightly in many contemplated improvements. number but not in severity, as the score of Brick production is being maintained at the strikes reported during the past month were maximum allowed, by the administration of 50 all settled peaceably. The strikes were genper cent of the 1917 output. The market is erally small, of local effect, and were evenly steady with an upward tendency. Govern- distributed throughout the district. ment construction in this district approximat- Mercantile.—During the first half of this ing several million dollars cost is under way year there were 398 business failures against and will require a large amount of material. 462 for the same period in 1917, while the Domestic lumber activities have been affected liabilities involved were about $200,000 less pending the Government price regulation, but than a year ago. Purchase and payment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,191S. FEDERAL RESERVE BULLETIN. 763 activities remained stationary with May this for the first issue to 1,827 for the second. year and increased slightly over the monthly The quota for the next loan having been reaverage for the last 30 months. Indebtedness duced one-third, every indication points to a declined from that of last May, June, 1917, large surplus subscription over the required and the 30-month average, due in great amount. measure to the condition of the crops and the The demand for money has been firm with stability of the market. Collections are fair rates practically unchanged. Through the throughout. Capital Issues Committee the issue of securities Business in general is reported to be above for unessential purposes is being materially normal, exceeding that of a year ago. Retail restricted and the committee is receiving the trade is good in all sections and prices are hearty cooperation of the public in its enalmost continually advancing. Handicapped deavors. by inability to secure merchandise in satisfactory amounts from the factories, retailers DISTRICT NO. 11—DALLAS. are conserving their surplus stocks, and it is A month ago mention was made of the exprobable, because of the rising market and cellent crop prospects which obtained practhe outlook for next year, that clearance sales tically throughout this district, except those and price cutting will not be as general as in sections of the west and southwest where the former seasons. There is evidence that a large dry weather had done much damage. The per cent of the dealers are buying earlier than present crop outlook is less favorable, however, customar}' in anticipation of a further rise in than 30 days ago, as very little rain has fallen prices and with the purpose of securing stocks during July. As the interests of the district while the opportunity offers. Interstore trad- are so largely agricultural, any change in crop ing, it is reported, has suddenly assumed prospects is at once noticeable. We believe unusual proportions owing to the scarcity of that the present excellent condition of crops supplies and a desire among merchants to in north, northeast, east, and central Texas more evenly distribute stocks of different lines. will largely, if not entirely, offset the poor Manufacturing continues active with most yields in less favored communities. Outside factories running to capacity when not ham- of the changes in farming conditions, the genpered by labor shortage. Trade in shoes and eral situation is the same as quoted in our jewelry is very good, while that in drugs and July letter. The readjustments in all lines groceries is fair to good. Hardware conditions of business are going steadily on and becoming are somewhat unsettled due to scarcity of more noticeable every day. The volume of supplies. Implement dealers in most of the trade at the present time is less than during distributing districts report exceptional sales the same period a year ago; that is, as to numof farm machinery. ber of orders. The higher cost of merchandise, however, has more than offset this decrease. Financial.—Bank clearings in the 14 prin- The large Government contracts placed in this cipal cities in this district increased about 20 district have also been the means of stimulatper cent in June over the same month a year ago, while a comparison of the six months' ing business. period this year and last shows an increase of At the risk of repetition, it may be stated 32 per cent. Latest returns have brought that conservatism and economies arc being forth the fact that the tenth district has over- more widely practiced in this district than at subscribed by $31,500 its tentative quota of any previous time. The many calls for $30,000,000 for the second issue of Treasury financial assistance in the Government's war certificates of indebtedness. The number of plans and the commitments which are necesindividual subscribers has risen from 1,198 sary to enterprises essential to the success of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

764 FEDERAL KESERVE BULLETIN. AUGUST 1,1918. the war have made for a restriction in the pur- The Elberta peach crop, which is one of the chase of luxuries and high-priced articles. most important in east Texas, has been moving Apart from the general derangement of con- during July. The crop has sold at $1.50 to ditions, as a result of the war, the unfavor- $2 per bushel, the peaches were of excellent able situation prevailing in west Texas on quality, and the growers have had a satisfacaccount of the drought and other factors, condi- tory season. tions existing in this district are quite satis- Scattered rains have fallen over portions of factory. the range country during July; they have not Wholesale trade in all lines, as reported by been sufficient, however, to help conditions to our correspondents, is excellent; in hardware, any extent, and live stock interests continue drugs, and groceries the volume is especially to suffer from the drouth. Our correspondents heavy. Retail trade in seasonable lines and in New Mexico and west Texas report that conlight summer apparel is also good. The usual ditions are extremely unfavorable, and heavy midsummer clearance sales are being put on losses have resulted. This condition has and have served to make retail lines active. caused a general depression in business in that Collections are good. section. A good deal of stock has already Manufacturing plants are operating on full been moved out of Roswell County, and more time. The uncertain delivery of raw material are going daily. Losses in Lea, Chaves, and on account of transportation difficulties and Eddy counties have been the largest in the the scarcity of labor have largely affected the history of that section. These losses have reoperations of the factories in this district. In sulted in dull business, and collections are poor many cases the output of plants is reduced as a result. Another problem which confronts from 25 per cent to 50 per cent, on account of the cattle men is that of placing their live stock inability to obtain adequate supplies. paper. The area planted in cotton in this district is The large commission firms in the packing so extensive that the condition of the crop de- centers, Chicago, Kansas City, St. Louis, and pends on the planting season. In north, east, Fort Worth, where a largo per cent of this cattle south, and central Texas the condition of the paper is carried, are not in the market for crop at the present time is good to excellent. loans at this time. This has forced the banks in In central and west Texas and the Panhandle the cattle country to largely share this burden. sections the crop is only fair. As the plant can There is but little trading in live stock at the bear hot, dry weather it has not been seriously present time. affected by the recent excessive heat. The The financial situation is still very active; corn crop is, for the most part, in good condithere is no decrease in the demand for funds. tion, but is beginning to need rain badly, and While all legitimate credit is being cared for, in some sections is seriously hurt. Other feed and our member banks are extending all crops, such as peanuts, cane, sorghum, maize, needed assistance to their customers, they are, and broom corn, are generally in satisfactory nevertheless, conservative in granting credits, condition. and are closely scrutinizing the same. The de- The thrashing season is now under way and mand with this bank continues heavy, and the small grain crop is turning out generally within the past 30 days our bills discounted satisfactory, except in northwestern Texas, show an increase of some $4,000,000. where the crop is practically a failure. The Within another 30 days the cotton crop will yield in north, northeast, and central Texas will begin to move in this district, and the problem be from 15 to 30 bushels per acre for wheat, and of handling it is quite serious. Recent meet- 30 to 40 bushels per acre for oats. In those ings of bankers and cotton planters of this dissections the crop could hardly be better. trict have been held, and it is hoped some Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 765 effective moans may be had for financing and for export into Mexico. During the past moving the crop. The bankers of this district month the export and import business between have endeavored to do their part in subscribing the United States and Mexico has been unusufor Treasury certificates. Conditions in the ally heavy. West, however, are such that the institutions DISTRICT NO. 12—SAN FRANCISCO. there find it difficult to purchase their quota. Recent weather conditions, combined with Interest rates are steady to firm. Bank unusually heavy damage by insects, have been clearings in the principal cities of the district unfavorable to the proper development of the for Juno show an increase of 8 per cent over the grain crops. The Government report of July 1 same period last year. The figures were as gives the following estimate of grain producfollows: tion for the district: .1917 $204, 784, 925 1918 220, 942,487 1918 1917 Increase (8 per cent) 16,157, 562 Bushels. Bushels. Wheat. 90.778,000 70,899,000 Building permits issued at the principal Barley. 51,440,000 57.664,000 Oats... 42,977,000 43,037,000 cities of the district in June show an increase in Rye... 971,000 580,000 Corn. 7,491,000 7,283,000 number of 228, and an increase in valuation of Kay I 11,428,000 13,604,000 $267,387, or 22 per cent. The lumber market has been more or less de- This estimate averages about 10 per cent moralized, due to the agitation of Government less than a month ago. price fixing. With the question settled, how- A greatly reduced acreage of potatoes and ever, and prices fixed, both on Government sugar beets is shown, the farmers having purchases and outside trade, the lumber busi- planted other crops which promised larger ness is going forward well. The mills report financial returns. The estimated production the car supply ample, but as the crop begins to of potatoes is 32,147,000 bushels, compared move a considerable shortage will unquestion- with 47,156,000 bushels in 1917. ably be felt. Lumber manufacturers are run- Deciduous fruits are in good condition, but ning on full time, but, due to the scarcity of the total production will probably be somelabor and the inefficiency of the help secured, what less than last year, although carload production is not more than 80 per cent of shipments from California this season to July normal. The price fixed by the Government, 13 have been 2,152 cars, compared with 2,112 while somewhat lower than manufacturers cars in 1917. It is estimated that the applo thought it should be. is, nevertheless, yielding crop of the Pacific Northwest will be less than fair profits on the present basis of cost. The 20,000 cars, about 10 per cent below the 1917 cost of production, however, is going up so yield. rapidly that the time is not far distant when Prices of all farm products are in excess of the production cost and selling price will not be those of last year. Although the costs of far apart. production, especially labor, have increased, Post-office receipts in the principal cities of the farmers are insured a good profit, and the the district show an increase of 52.7 per cent restriction of the middlemen's profits assures over the same period last year. San Antonio equitable prices to consumers. No crop losses shows an increase of over 100 per cent, while have been reported on account of labor short- Waco shows an increase of 98 per cent. age. Business at border points is increasing since Preliminary estimates indicate an area of the Government has been more lenient in 597,000 acres planted to beans in California, issuing licenses on certain classes of foodstuffs compared with 558,000 acres in 1917. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

766 EEDEBAL KESEBVE BULLETIN. AUGUST 1,1918. output in 1917 was 4,980,000 ono-hundred- freighter by a San Francisco yard in 45 days pound bags, from the date of keel laying. The area planted to rice in California this Fir lumber mills of Oregon and Washington year is 108,000 acres, an increase over 1917 of have pledged themselves to supply to the Gov- 28,000 acres, indicating a production of ap- ernment each month not less than 600 cars of proximately 6,318,000 bushels. airplane fir. Additional orders for 60,000,000 Orange and lemon groves are in good con- feet of lumber for eastern cantonments have dition, and while it is somewhat early to obtain been placed, and it is said that orders fo r an accurate forecast, all indications are for a 110,000,000 feet for refrigerator cars, ship connormal yield next season. Total shipments struction, and Navy needs will be placed this season to July 1 have been 11,694 cars of shortly. The prices fixed by the Government oranges and 4,038 cars of lemons, compared are reported to be satisfactory. Lumber prowith shipments of 31,997 cars of oranges and duction was normal during June, but since 6,069 cars of lemons to the same date last year. June 25, when higher freight rates became The shipments after July 1 will consist entirely effective, there has been a decrease in producof valencias and are estimated at 2,500 cars tion, orders, and shipments. Washington procompared with about 10,000 cars moving after duced 12.7 per cent of all the lumber cut in the July 1, 1917. Prices have nearly doubled United States in 1917, with a total cut of since last year. 4,570,000 feet, thereby leading all the lumber The cotton acreage in Arizona and Cali- producing States. Destructive forest fires have fornia has materially increased this year. In been reported from many points in Washington, Arizona 92,000 acres were planted, compared Oregon, and California during the past month, with 46,000 acres in 1917, and in California and, owing to the extremely dry condition of 194,000 acres, compared with 117,000 acres in the forests, they are being controlled with 1917. The condition of the crop on July 1 great difficulty. forecasted a yield of 200 pounds to the acre, June bank clearings for the nine reserve and sales have been reported at prices ranging cities of the district, although slightly less than from 30 to 72 cents per pound, according to the the previous month, increased 25.3 per cent quality. over the corresponding month of .1917. Build- A recent estimate of this year's probable ing permits for the same cities increased 16.5 salmon pack is 8,500,000 cases. In 1917 per cent over June, 1917. the production was 10,124,858 cases, and the Although labor is scarce and the farmers are average for the last eight years is 7,032,082 having some difficulty in harvesting their crops, cases. conditions are fairly settled. The "win-the- Most of the shipyards of the district have war" spirit seems to permeate the workers in contracted for their entire output for the next the essential industires generally, and in sev- 12 months, and many yards for a much longer eral coast cities the shipyard and metal trades period. It is estimated that the value of the workers, who were awarded Saturday half production of all the yards building steel and holidays during the summer months by the wooden ships on this coast is over $500,000,000 Wage Adjustment Board, have offered to per year. Of 55 constructors of steel ships forego their half holidays and work, without and 78 constructors of wooden ships rated for requiring extra pay for the overtime. efficiency for the month of May by the Emer- The general credit situation is described as gency Fleet Corporation, the five highest rated stable when banks maintain cash payments steel and eight highest rated wooden ship against depositors checks; when farmers, merconstructors are in this district. The most chants, manufacturers, and others engaged in - notable construction record yet made any- production and distribution are able to obtain where was the launching of a 12,000-ton steel their customary loans for reasonable and legiti- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918, EEDKEAL EESEBVE BULLETIN. 767 mate requirements, and when banks are able business, including all banks, whether member to sell or rediscount a portion of their loans if or nonmembor. they become overloancd. The interruption of Gold in possession of a member bank or an any of these processes prevents the rhythmical individual serves no necessary purpose which flow of commerce and industry. Labor meets other forms of money would not serve, but in unemployment; trade is thrown into confusion, the possession of a Federal "Reserve Bank gives and panic may result. Such a condition is the financial protection to the country as surely opposite of stability. as an army gives physical protection. To draw Stability, is now dependent upon the con- soldiers from the army or keep them from the tinuing ability of Federal Reserve Banks to army to perform services which others could make advances to other banks which may be in perform would weaken our physical defense and need, and the strength of Federal Reserve invite disaster. Likewise, to hold gold out of the Banks to do this is measured by the proportion reserve of Federal Reserve Banks weakens our of their gold reserve to their liabilities. financial defense and invites financial disaster. When a member bank rediscounts a note Banks of this district, for their own protecwith a Federal Reserve Bank, the latter con- tion and that of all business, have patriotically currently incurs a liability for the amount of cooperated to build up the Federal Reserve the proceeds. Such liability usually takes one Bank;s gold reserve, making more than 2,000 of two forms—either a credit in the account of gold shipments during the three months ending the rediscouniing bank on the books of the with June, and increasing the total gold held Federal Reserve Bank or a payment to the from $99,815,000 on March 29 to $130,963,000 member bank of Federal Reserve notes. on June 28. Either form is a promise of the Federal Reserve Shipments have been received as follows: Bank to pay money—the one a promise to pay against the presentation of checks; the other, Gold Gold held engraved promises, in currency denominations, received. Mar. 4,1918. to redeem in money when presented. Against National banks ! 816,880,230 $14,944,270 both forms of liability the Federal Reserve State banks 8,799,915 38,124,165 California public treasurers, 2,846,900 Bank carries a gold reserve in order to assure Total '• 28,527,045 ! 53,068,435 its ability to make good its promises to pay money. The strength of this gold reserve is The increasing demand upon the Federal what measures the ability of Federal Reserve Reserve Bank is shown by the fact that, al- Banks to extend accommodations to other though the amount of the gold reserve has banks when they need it. If needed accom- increased over $31,000,000, the proportion of modation were not extended, confusion and gold to liabilities has decreased approximately panic would result which would involve all 1 per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

768 FEDERAL RESERVE BULLETIN. AUGUST 1,1918,. COURSE OF LEADING ASSET AND LIABILITY ITEMS OF THE FEDERAL RESERVE BANKS IN 1918. In the following tables are shown for each at present about 50 per cent, the largest pro- Friday of the current year the amounts of war- portion, viz, 71.2 per cent, being shown on loan paper held by the Federal Reserve Banks April 26, just before the close of th6 third Liband percentages of these amounts to the total erty loan, and the lowest proportion at the weekly holdings of discounted paper; also beginning of the year, when, however, part of holdings of bills purchased in the open market, the advances on United States war securities, and of all other earning assets, nearly all United made in the shape of short-term investments States securities, including bonds, one-year in such securities was included with other earn- Treasury notes, and Treasury certificates. By ing assets. Other fluctuations in the volume far the larger share of the war-loan paper held of the latter item are traceable largely to shortby the Federal Reserve Banks is made up of time advances of the New York bank to the member banks' notes, secured by Liberty bonds Government, for which corresponding amounts and Treasury certificates. of Treasury certificates were taken. During the early part of the year, i. e., prior In another table and diagram are shown the to the enactment of the War Finance Corpora- course of the leading liability items, i. e., detion bill on April 5, when notes secured by posits and Federal Reserve notes in circula- United States war obligations were exempted tion and changes in the reserve position of the from the stamp tax, the Federal Reserve Banks banks. For this purpose weekly figures of the reported among their United States security aggregate cash reserves and of the ratios of the holdings considerable amounts of Liberty bonds latter to the aggregate net deposit and Fcde: al 4 and certificates purchased for terms not ex- Reserve note liabilities were added. In this ceeding 15 days under so-called "repurchase table the largest increase during the year, viz, agreements." The effect of the tax exemp- 577.8 millions, is shown for Federal Reserve tion for war-loan paper is seen in the large notes in circulation, as against gains of about increases on April 12 and 19 of the item "Col- 120 millions in net deposits and of slightly loss, lateral notes secured by United States war than 300 millions in reserves, largely gold. obligations" and the corresponding decreases As a result of this development the reserve on the same dates of "All other earning assets." percentage of the banks shows a decline since Of the total discounts held by the Federal the beginning of the year from 64.2 to 59.8 Reserve Banks the share of war-loan paper is per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 769 Movement of earning assets, deposits, and reserves of the Federal Reserve Banks since Jan, 4, 1918. 1. EARNING ASSETS. [In thousands of dollars; i. e., 000 omitted.] (1) (2) I (3=14-2) | (4) (5) (6) (7) |(8-4+6+7) r Member j banks' ! Other collateral I paper se- 1 o n C u S o r t n t c a e i d t s t e e s b s d e y -1 ( I w c U S u ar r t n a e i o t d t e b e s b d li y -: c b o i T l u l o s n t t d a e l i d s . - o P f e r 3 c t e o n 4 t . ; I , j b m i o B n a u i o r l g l k p h s e e t t n . . e • a v a i s l r s n o e i t t n h s g , e r j j j e a T a s o r s n t e i a ts n l . g war obli- gations. :gations. gations. ! T 1918 Jan. 4 140,711 145,208 ! 285,919 (525,813 45. 7 271,338 148,392 1,045,543 Jan. 11 138,001 139,013 I 277,014 570,605 48.5 258,710 191,796 i 1,021,171 Jan.18.... 152,688 147,580 I 300,268 I 603,488 49.8 257.804 i 172,445 i 1,033,737 Jan. 25.... 159,300 153,220 : 312,520! 027,662 49.8 273,912 I 128,096 I 1,029,670 Feb.l 154,259 151,405 I 305,CC4 ! 006,778 50.4 -289.805 I 136,437l 1,033,020 Feb.8 121,206 148,036 ! 269,302 I 525,121 51.3 I 280,705 i230,305 1,036,131 Feb. 15.... 133,971 111,723 245,694 I 501,916 50.0 ! 287,263 ; 162,810 951,989 Feb. 21.... 122,244 141,661 263,905 509,534 51.8 j 296,170 I226,093 1,031,797 Mar.l 96,957 152,239 ! 249,196 : 502,525 49.6 i 299,213 ! 238,867 , 1,040,605 M M a a r r . . 1 8 5 1 1 0 0 7 7 , , 8 4 7 1 9 1 1 1 5 5 6 0 , ,2 6 1 2 0 2 : 2 2 5 6 7 4, , 5 6 0 2 1 1 i 5 5 2 1 0 7 , , 3 4 4 8 0 4 i 5 4 0 4. .8 6 • ; 3 3 2 1 3 7 , , 2 95 4 2 8 2 2 6 5 6 9 , , 4 0 0 4 3 0 ! i 1 1 , , 0 1 9 0 7 7 , , 3 1 3 3 2 5 Mar. 22.... 125,698 157,264 • 282,962 543,119 i 52.1 328,880 291,315 i 1,163,314 Mar. 28-29. 134,176 167,275 • 301,451 I 583,228 • 51.7 : 304,005 314,292 ! 1,201,585 Apr. 5 136,597 167,478 304,075 : 573,883 ! 53.0 326,503 324,025 " 1/224,411 Apr. 12.... 302,187 163,438 465,625 ! 712,807 : 65.3 : 318,857 ' 200,151 ' 1,231,815 Apr. 19.... 410,536 154,188 564,724 808,045 • 69.9 j 308,277 ' 90,263 i 1,212,585 Apr. 26.... 494,G81 147,748 642,429 i 901,743 ! 71.2 302,844 . 81,575 ! 1,286,162 May 3 468,882 137,748 606,630 ; 873,442 , 69.5 • 297,029 : 80,098 i 1,250,569 J J J J J J J M M M M u u u u u u u a a a a l l n n n n l y y y y y y y e e e e S 1 1 2 2 2 1 1 1 7 3 1 8 4 9 2 4 7 0 1 . . . . . . . . . . . . . . . . . . . . . . . . I 4 4 4 4 4 4 4 4 5 5 3 6 4 9 6 1 1 2 5 3 1 0 1 9 2 6 8 6 6 0 1 1 9 , , , , , , , , , , , 8 7 5 1 8 3 3 1 6 2 4 2 7 9 4 6 6 6 5 6 2 2 2 0 9 9 9 1 6 8 0 3 1 1 1 1 1 1 1 1 1 1 1 1 2 4 0 0 1 4 2 4 5 1 1 2 4 7 7 1 7 5 6 1 8 5 , , , , , , , , , , , 7 9 8 7 1 0 9 1 6 0 3 7 0 0 7 3 8 9 7 3 3 6 7 0 2 2 0 6 4 5 3 5 5 5 5 6 ( 0 4 5 ( 6 6 5 0 5 5 2 6 3 2 6 1 5 4 1 0 0 6 2 4 7 3 3 4 2 ' 6 0 , , , , , , , , . . , 1 5 9 8 1 0 4 3 5 4 4 0 0 6 9 9 2 9 2 9 9 0 9 3 3 3 3 5 6 4 9 9 3 1 1 i : 1 i ! . ! 1 , , , , 1 0 0 9 2 9 9 8 8 9 8 5 1 7 2 0 3 3 4 6 8 9 6 9 6 3 3 9 1 2 9 7 4 , , , , , , , , , , , 0 8 7 3 2 0 2 2 1 3 4 3 8 8 4 9 4 7 6 7 5 9 1 2 2 6 9 1 0 5 5 7 2 i I j ; ' | i i • 6 6 5 6 6 6 6 5 5 5 5 2 0 2 2 5 5 3 2 0 4 8 . . . . . . . . . . . 3 5 3 0 7 0 2 7 0 4 4 : : • i ! : - 2 2 2 2 2 2 2 2 2 2 2 3 8 5 4 1 1 0 7 7 4 1 2 i 6 2 8 8 1 5 9 8 6 ' > , , , , , , , , , , 7 2 3 9 8 4 9 9 5 S 0 4 2 8 7 2 6 4 3 4 4 3 7 1 6 3 3 4 7 2 2 8 6 2 i ! ; ! ! : j j i 2 1 1 1 1 5 5 7 9 7 4 7 7 6 4 . 6 9 7 5 2 7 4 6 0 8 5 ; , , , , , , , , , , 7 7 0 4 6 8 2 8 1 7 5 1 7 5 8 9 6 6 2 6 2 7 5 9 6 9 4 0 0 5 8 2 6 ! ! ! ! : j i I I • i . 1 1 1 1 1 1 1 1 1 1 1 , , , , , , , , , , , 4 4 2 3 3 2 3 3 2 3 3 5 ( 7 0 7 3 4 4 3 4 3 5 0 7 1 3 3 0 8 5 7 0 5 ,< , , , , , , , , , , 2 3 4 7 6 8 1 7 8 9 6 1 9 1 9 5 0 1 2 1 9 1 4 0 0 9 4 2 2 7 3 3 4 2, DEPOSITS, NOTES, ANT) RESERVES. (J) (2) (3) (4=2+3) (5) Aggregate d G e m o p v o e e n s r i t n ts - . dep N o e s t its. ci n R F r a c o e e c u t d s e t l e u e a s r r a t v a m i l o e l n. n F s e e e t r d v d a e o n e ra p d n l o o R s t i e e t - res C e a rv s e h s. p R e e a r s g c e e e r . n v t e liabilities. Jan. i $131,006 $1,146,228 SI,251,205 82,697,433 SI, 733,030 64.2 Jan. ii 60,523 1,452,512 1,244,280 2,696,792 1,748,031 64.8 Jan. 18 239,829 1,490,373 1,238,797 2,729,170 1,784,307 65.2 Jan. 25 135,691 1,492,878 1,234,934 2,727,812 1,782,759 65.4 Feb.1 132,790 1,488,036 1,236,101 2.724,137 1.775,457 65.2 F F e e b b . . 8 15.... 5 8 0 7 , , 4 5 8 4 8 3 1 i; , 4 5 0 0 3 2 , , 6 8 3 5 4 3 1 1 , , 2 2 6 8 1 1 , , 2 0 1 4 9 5 2 2 ; , 7 6 6 8 4 4 . 1 0 6 7 7 2 9 l 1 ' , f « 8 1 1 H, 3 7 , 3 0 6 94 i 6 \ 7 5 . . 7 6 Feb. 21.... 06 165 1,462', 627 1,314,581 2,777,208 1,832,524 66.0 Mar. 1 150,781 1,4391887 1,351,091 2,790,978 1,837,773 65.8 Mar. 8 56,208 1,472.439 1,383,990 2,8,56,429 1,847,883 64.7 Mar. 15.... 72,023 1,464' 5i9 1,406,228 2,870,747 1,852,193 f.4.5 Mar. 22.... 91,505 1,505,774 1,429,509 2,935,283 1,862,372 63.4 Mar. 28-29. 104,086 1,535,367 1,452,838 2,988,205 1,874,063 62.7 Apr. 5 104,818 1,5291364 1,479,920 3.009,284 1,877,433 62.4 Apr. 12.... 100,523 1,533,827 1,499.377 3;033,204 1,894,995 62.5 Apr. 19 75,499 1,502,246 1,415',2S7 2,917;533 1,898,307 62.9 Apr. 26.... 130,668 1,555,303 1,526,232 3,081,535 1,890,915 61.3 May 3 73,888 1,520,957 1,556.660 3,077,617 1,919,983 62.4 May 10.-.. 138,529 1.651,32-1 J,5691618 3,220,942 1,942,500 60.3 J J J J J J J M M M u u u u u u u a l n a n a l n n l y y y y y y o e e e S 1 1 2 2 2 1 7 1 3 2 1 8 9 4 4 7 1 - . . . . . - . . . . . . . . . . . . . 1 1 1 1 j 1 1 1 . 8 4 2 0 2 5 5 4 6 7 4 8 6 8 5 2 9 4 9 0 , , , , , , , , , 1 5 7 5 8 3 8 3 4 3 . 3 5 3 7 2 5 9 5 9 9 2 3 5 6 8 7 0 3 1 8 1 1 l 1 1 1 1 1 i 1 , l 5 , , , , , , , , 5 4 5 5 5 5 4 5 5 K ( 4 2 7 S 5 7 5 2 5 ' 5 9 ) 6 7 3 3 8 6 4 ,G , . , , ' , , , , 9 4 8 3 6 6 7 6 4 0 0 2 1 6 1 6 8 7 5 S 3 7 9 4 8 0 4 1 3 1 1 1 1 J 1 i 1 1 3 ; , , , , , , . , , 7 6 6 7 6 8 5 5 6 S 2 0 3 9 1 5 6 7 7 2 2 0 3 9 1 1 9 7 8 9 , , , , , . ; ; 0 , 2 4 9 5 5 5 6 4 9 1 1 2 6 7 6 0 2 4 5 * 5 5 8 9 9 0 1 5 1 3 3 3 3 3 3 3 3 3 3 , , , , . , , , , , 2 2 3 1 2 1 3 2 1 0 ( 5 0 ^ 1 6 4 2 3 9 5 2 5 7 5 7 0 3 6 3 5 , , , , , , , , , , 0 5 7 9 2 0 3 2 8 4 : 7 7 4 2 8 3 5 9 9 5 6 1 3 5 9 9 4 8 6 4 2 2 2 2 2 1 1 1 1 1 , , , , , , , , , , 0 0 0 0 0 9 9 9 9 9 0 0 3 1 1 8 7 7 5 5 5 6 1 5 5 7 1 5 6 2 , , , , , , , , , , 2 1 1 0 9 7 7 1 0 7 6 6 9 9 8 0 2 5 1 1 3 3 9 5 4 9 4 6 2 1 0 6 6 6 6 5 6 6 5 5 1 1 3 1 2 1 2 3 9 9 . . . . . . . . . . 7 9 4 0 7 5 4 9 1 8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

770 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. MOVEMENT OF-E4RN!Pt0A88cT6 OFTttEFR.BANKS, SiNCH JAN/h 1918 secured by OlS. Jf&rVblufczbions.. CurveZ:AllJhpxr'secured,by U.S. TV&r Orations. Curve 3: JdtalJBitls discoaMed. Cijurve 4J3cal3iUs discounted, i and boaghc ui aft&n, mcwlceb* Curve 5; Jotal Sarnuiq Assets, including Government; Securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 771 or me sines FR. BANKS, JANA.ISIS. Carre /./ Goverrim&tt ^Deposits. Carrel.* i s CasfcSleserves. Ckrr&S* Ma£w of GsisKftaserves Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

772 FEDERAL RESERVE BULLETIN. AUGUST 1,1918= GOLD SETTLEMENT FUND. Operations through the gold settlement fund cent in the change in ownership of gold is due for the four-week period from June 20 to chiefly to the concentration of gold at the New July 18 were heavier than for any correspond- York bank resulting from transfers from other ing period since the commencement of the Federal Reserve Banks for the account of the operation of the fund, due largely to the tem- Government. porary concentration of funds at New York The New York Federal Reserve Bank's following the issuance of a large volume of credit in the gold settlement fund increased Treasury certificates of indebtedness and pay- $120,628,000 through transfers and settlements ment of the 35 per cent installment on the third during the four-week period under review, liberty loan. Combined clearings and trans- thereby causing a large reduction in the total fers amounted to $4,233,991,000, averaging change in the ownership of gold since the $1,058,497,750 per week, against a like average commencement of the operation of the fund, of $918,050,800 for the preceding period, an May 20, 1915. Net changes in the ownership increase of 15.3 per cent in the total average of gold in the fund from that date to July 18, weekly clearings. 1918, amount to 0.77 per cent of the total The daily settlement between the Federal obligations settled. For the four weeks ending Reserve Banks through the gold settlement July 18, New York, Philadelphia, and Clevefund which was inaugurated on July 1 has land show the largest gains through the snifting practically eliminated all telegraphic transfers of credits in the fund, while Chicago, Boston, between banks except those made for Govern- Kansas City, and San Francisco show the ment account. Amounts formerly carried on largest decreases. the books of the banks as "Due from77 or Total deposits of gold in the banks7 fund, "Due to77 other Federal Reserve Banks are principally at San Francisco, New York, Philanow settled through the gold fund daily in- delphia, and Chicago, aggregated $75,606,300, stead of weekly, thus resulting in less fluctua- against gold withdrawals of $9,814,200, retion in the reserve position of each bank and sulting in net gold deposits of $65,792,100. undoubtedly reducing the amount of redis- Net gold withdrawals in the agents7 fund count operations between banks which would amounted to $6,500,000, giving an aggregate have been necessary had the former plan of net gain in the combined funds during the weekly settlements been continued. four-week period of $59,292,100. The com- Changes in the ownership of gold in the bined banks7 and agents7 balances in the fund banks7 fund through transfers and settlements have increased over 52 per cent since Janduring the four-week period amounted to 3.59 uary 1, 1918. per cent of the total obligations settled, as Below are given figures showing changes in against 1.46 per cent during the preceding five- the fund between June 21 and July 18, both week period. The large increase of 2.13 per inclusive. Amounts of clearings and transfers through the gold settlement fund by Federal Reserve Banks from June 21, 1918, to July 18, 1918, both inclusive. |In thousands of dollars.] Total Balances Clearings and clearings. adjusted. Transfers. transfers. Settlements of— Total for 1918 to date. 24,793,199 June 27 60,033 114,400 Total for 1917 27,154,704.5 July 1-5 1,090,900 50,431 251,679 Total for 1916 5.533,966 July 6-11 743,803 78,473 25,000 Total for 1915 , I', 052,649 July 12-18.... 995,740 67,600 114,000 Total, clearings and transfers from May 20.1915, to July Total 3,728,912 262,537 505,079 18,1918 ...: 58,534,518.5 Previously reported for 1918. 18,402,513 1,340,171 2,156,695 Total since Jan. 1* 1918.. 22,131,425 1,602,708 2,661,774 Total for 1917 24,319,200 2,154,721 2,835,504.5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. Changes in ownership of gold. [In thousands of dollars.] Total to June 20, Prom 21 !918 to Ju.y 18, 118, 1918. ootn inclusive. July 18, Balance to credit Federal Reserve Bank. June 20, 1918, Balance Decrease. Increase. plus net July 18, Decrease. Increase. Decrease. Increase. deposits 1918. of gold since j that date. I Boston 57,465 ! 67,375 37,314 30,061 27,404 New York 574,289 .1118,117 238,745 120,628 453,661 Philadelphia.. 66,506 34,870.2 49,900 15,029.8 , 81,535.8 Cleveland 99,988 ! 17,403.6 30,620 13.216.4 i 113,204.4 Richmond 8,776 i 21,272.6 14,832 6,440.6 2,335.4 Atlanta 48,385 ! 24,149 17,444 6,705 41,680 Chicago 79,864 112,833.1 47,439 65,394.1 14,469.9 St. Louis 33,301 i 29,605.3 21,279 8,416.3 24,884.7 Minneapolis... 16,225 29,084.8 1133^112244 | 1559,966008.8 264.2 Kansas City... 45,382.5 41,434 37,383.5 Dallas .".... 20,084.5 10,799.4 14,186 ; 3,386.6 23,471.1 San Francisco. 98,312 ! 37,409 26,125 ! 11,284 87.028 Total 574,2S9 ,574,289 .[544,443 544,443 1152,260.8 152,260.8 453,661 453,061 Gold settlement fund—Summary of transactions from June 21, 1918 to July 18, 1918, both inclusive. [In thousands of dollars.] Federal Reserve Bank. j ! 2 B s 0 m J t a , l u 1 a a l e n 9 a t s n e n 1 t e t - 8 c . e d w G r i a o t w l h d - - p G o d s o e i l - t d s. J I A a f t w e r g g a g a r i e a n s g t n n t d h r e t s t e - o - ' - s t a r A f a g f u a g r n e o n n g s n m d d f r t e e . 's r - s Deb T i r t a . ns | f C er r s e . dit. W de N i a e n b n e e c i d k t t l s u l d , y s a i s v i e l d e y T t e . t l s o b e e t i m a t t t s l l e , e n m t c e r T o n e f o t d s t J i a t J u s l u n , l e y c 2 1 r 7 N e t , o 1 d e 9 i 1 t t 1 8 s 8 , . 1 ; i ! o i B a 1 „ n 8 f t n J a b , c u 1 e f l , u u l a 9 s l o y s n n 1 s s i 8 , c d e - e . ! fund. i Boston 65,375 2,000 2,000 6,5001 24,719 347,169. 323,608 1,187! 37,314 N Ph e i w la d Y e o lp rk hia 1 3 3 1 3 , , 5 1 4 2 4 7 2,5 5 0 0 0 0 2 1 2 0 , , 4 5 9 9 0 5 3 1 7 1 , , 5 5 0 0 0 0 i j2 1 2 4 , , 4 8 9 2 0 6.2 1 1 3 6 3 , , 3 6 5 6 4 0 ! ! 343,665; 124,6 3 8 2 3 7 1,2 3 5 72 8 , , 4 0 1 6 8 9 i 1 4 1 0 6 3 8 , , 8 6 0 9 2 2 3 3l 5 ) , 7 3 1 0 1 6 ? i 2 4 3 9 8 , , 9 7 0 4 0 5 Cleveland 26,215.9 3,014 4,201.7 13,140 I 4,201.7 15,700; 26,677 329,258! 358,174! 55,593! 30,620 Richmond 22,465.6 553 360 1,553 | 360 33,000 15,000; 4,349 175,177! 186,736: 15,908| 14,832 Atlanta 24,814 100 1,735 16,900 | 16,235 10,523 100,2121 93,507; 3,818: 17,444 Chicago 7744,,33199..11 1,,00000 5,',611 45,500 I 84,014 159,200 96,000 19,252; 526,853! 524,437| 16,836^ 47,439 SStt.. LLoouuiiss . 22,476 j 11,222288.22 ; 115577 8,128.2| 15,347.5 20,220 20,440! 35,805! 241,8711 233,235i 27,169: 21.279 Minneapolis | 15,012.8! I 4,072 14,072 20,000 2,707! 99,347! 103,608! 6,968 13,124 Kansas City I 39,997.6! 80 j 1,516.4 1,516.4 36,445 2,754! '422: 124,228! 149,920; 26,114! 33,435 Dallas .* I 10,960.21 839 | 678.2 678.2 3,000 5,0001 2.041! 57,24G| 58,633; 3,428) 14,186 San Francisco ! 21,719 j j22,190 13,000 61,000 22,220, li; 003! 97,064! 124,560. 38,499! 26,125 Total |488,026.2; 9,814.2:75,606.3 148,014.2J204,431 505,079 505,0791 262,5373,728,9123,728,912; 262,5371 544,443 Federal Reserve agents fund—Summary of transactions from June 21, 1918, to July 18, 1918, both inclusive. [In thousands of dollars.] Federal Reserve agent at— J B u m s a 1 l t n 9 l a a e a e 1 s t n n 8 e t 2 t c . - , 0 e , dr w G aw i o t l h a d - ls. de G po ol s d its. t t d r o W a r a n b fo w i s a t f r n h a e k l - r s s . t D t r h a b f e r n r a o p o s n o u m f k e s g . i r h t s s dr T w a o w it t h a a - l ls. de T p o o t s a i l ts. J B a o u t f a 1 n l 9 l c y b e a 1 l u s o n 8 1 s s s . c 8 i e e , - Boston 49,500 •49,500 New York 65,000 35,000 35,000 100,000 Philadelphia 86,730.2 ; 1,500 4,231.2 i 11,000 5,731.2 11,000 91,999 Cleveland 85,000 : 10,000 10,000 95,000 Richmond 31,500 1,000 1,000 32,500 Atlanta 25,520 1,000 j 14,500 : 16,800 15,500 16,800 26,820 Chicago 174,121 1,000 ! 78,4-03 ".•44,500 79,403 44,500 139:218 St. Louis i 37,921.5 ;. 15,190.5! 6,900 15,190.5 6,900 29,631 Minneapolis ! 19,500 10,008 . 10,000 9,500 Kansas Cilv I 31.360 |. 31,360 Dallas ! 584 584 San Francisco | 74,631 3,000 i 6,500 13,000 i 9,500 13,000 78.131 Total ;681,367.7 , 6,500 j ..i]28,824.7 ! 138,200 il35,324.7 , 138,200 684.243 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

774 FBDSEAL RESERVE BULLETIN. AUGUST 1,1918. OPERATION OF THE FEDERAL RESERVE CLEARING SYSTEM, JUNE 16 TO JULY 15, 1918. b I ( t a d e R n a m k i e l s s s y e i d r a n v v r a e F e w r e c a d i n g t e y e o r ) a n . l I b I ( o t d a u e K n a t m s c i k l i s s s y d c i e d r a n v r v F e a d e e w i r c d s a n i t e g t r y r o e i a c ) n l - t I d b te i a s m n a tr k v s i s e c d r t i a s r n a g ( w e o d ) t a n . h i e l o y r n j ; j ( b I d a t y a n e i m d l b y o s b t a r h h v a a n e b n r c a d a h n g l e e k e s d s ). T ( o o U d o n f a n t i a i T i t l t e l y r e m ( e d a e a s v x s S e c d u t r l r r a u a e a t g s e r w i e s o v n ) ) f e . I ( t d U e a T m n i r l i e s y te a d a d s r v u a S e r w e r t a r a n g t o e o e f s ) n . m N be b u e r e m m r o - - f N m b n b e u o e e r m n m r - o - - f banksbanks 1 in dis- on Num- trict. par Amount. Amount. , Amount. Amount. ber. Amount. ^1 Amount. list. Boston 403)324,406.756 49,3561S8,a»3,Odi 5,486!S8,564,241 61,245 §41,,8 69.,,3_3 4 317 S3,967,235 416 249 New York : 401: 76.185;543 71,187 46,967,994 31,893:17,339,852 122,481 140,493,389 41) 13117,282,766 357 Philadelphia 747! 22;744,165| 30,792 551,616-15,73712,155,2521 56,27639,451,033 3,826,020 630! 324 Cleveland 167! 8,044,0161 42,460 26,903,410! 2,406; 4,857,461!1,693 511,919,770 49,726 51,724,657 2,552,976 782; 690 Richmond 778! 5 317,51{2: 31,118J10,135,479: 4,81516,663,783 366! 1,128,404: 38,077!33,245,178 459,732 5461 345 Atlanta 719; 1,964,810! 17,654! 4,179,958; 2,425,! 3,252,062 440 272,499| 22,2381 9,669,329 2,535 2,465,257 319 Chicago 979! 25121,000 37,050J11 169,000! 3,986 917,000 456; 1,454,000! 51,47138,661,000 9,932 4,,04,70,0000 1,174; 2,296 St. Louis 8 211,951! 20,438! 5,219,395; 510 1,231,670 419 550,212: 24,35315,213,228 4, 889944,330099 489' 1,014 Minneapolis 903,658; 15,173 1,687,357! 899i 1,206,556 __ I8,71o! 9,797,571 152,832 823! 1,208 Kansas City 353,929! 35,092 11,019,158^ 4,183; 4,458,753|2,163! 2,057,296 44,135125,889,136 1 365,300 9731 1,573 Dallas.....". 126,604! 17,857 4,794,219! 1,3481 860,3S3!1,326! 161,354 22,118! 7,942,560 22!, 388,072 686; 281 San Francisco 840,714,! 23,0S7 8,225.697! 440, 1,048,984 3,180; 1,669,281: 28,149 13,784,676 3,605:10,779', 968 6061 1,105 Totals: June 16 to July 15, 1918. 5491192,220,658391,, 264 143,751,620i74,128:72,555,9979,757! 19,212,816 538,984 427,741,09182,536 47,181,467 8,212; 9,761 Mav 16 to June 15, 1918. 0551164,539,000:295,, 056113,407,619:54,132:55,703,310 7,623; 12,355,115 407,866 346,005,044 77,750 39,054,003 8,18S! 9,710 Apr. 16 to May 15, 1918- 49,569:178,372,385 287,; 06lill4,O99,520:54, SSS'oS, 513,363 8,113! 9,475 Mar. 16 to Apr. 15, 1918.55,03l|l59,44l,1.88i271,, 506198.201,96253.725 53,391,691 8,059j 9,450 J F a e n b . . 1 1 6 6 t t o o F M o a b r . . 1 1 5 5 , , 1 1 9 9 1 1 8 8 .1 . 5 4 1 6 , ,2 40 0 8 7 1 !l 1 5 5 3 3 ,S ,7 4 0 7 1 , , 5 3 6 7 8 5 - :2 2 5 2 9 7 ! ; , , 5 3 3 1 1 2 | 1 8 1 0 3 . , 2 1 4 3 8 4 , , 4 1 6 6 6 2 j | 4 5 4 l', , 65 2 4 5 9: 4 4 2 8 , , 8 5 5 5 2 6 , , 3 7 7 0 2 9 | 7 7, , 1 7 2 0 8 0 j ! 6 5 , , 4 1 S 3 3 , 6 0 , 7 9 1 5 : 8 3 ; 6 3 9 2 , 5 8 , 9 3 8 0 ; 1 3 | 2 2 1 S , 2 8 , 0 7 5 8 ;3 5 1 ,3 7 6 ! 4 5 | 8 4 , 8 9 , 9 2 1 2 4 2 i2 5 1 ,8 ,3 2 1 7 6 , , 7 0 5 3 7 3 8 7 , . 0 9 1 72 3 ! 9 9 ,3 ,4 1 2 9 5 Dec. 16,1917, to Jan. 15, 1918 48549,143.033.108;253,458 89,065,135149,342'52,175,578 718 3,402,035^359,067!292,585,856;38,130 21,116,293| 7,909 9,268 Nov. 16 to Dec. 15, 1917.1476;78; 17i; 723;439i240l756"84,4-40,761 i 46,353.58,458,952 343,787j314,623,152j33,806127,179,053! 7,823 9,321 Oct. 16 to Nov. 15, 1917-147,574! 166,552,773 232:723:61,296,21045,393!53,089,827 325,6901283,938,810:30,426117,496,974! 7,826 9,210 Sept. 16 to Oct. 15,1917.140,591112S, 271,466212!935J47,476,204! 40.216.44,984,581 293,742|220,732,251i!26,797!l3,518,566 7,747 9,052 Aug. 16 to Sept. 15,1917.136,306! 100; 331,6941182;1914.1,323,62132',564:40,648,168 .251,061jl82,303,483!23,49211,006,515 7,718 8,934 July 16 to Aug. 15, 1917.138,727! 98,075.9191"" 625*40,353.278131,273:37,981,022 1243,625 176,410,219! 19,533 9,701,569 7,683 8,837 June 16 to July 15, 1917.:38.476.109,722'.256182,G224i;;00 \, 720.33,941!46,762,698 1255,039 197,489,674,19,10011.637,899 7,666 8,805 M Ap a r y . 1 1 6 6 t t o o J M un a e y 1 1 6 5 , , 1 1 91 9 7 1 . 7 1 - 3 £ 7 3 , , 8 7 9 6 8 7 ] ! 8 9 7 7 , , 3 3 7 2 0 2 . ; 8 8 5 S 9 3 : . 1 1 7 79 1 , ;0 1 9 9 3 3 3 |3 6 8 ', .5 47 9 3 9 , , 1 4 6 6 3 1 !3 3 3 3 ; , 4 1 2 5 8 0 ^ :3 3 8 6 , , 3 83 1 6 4 , , 9 3 3 9 4 3 .! J2 ''22 3 55 8 00 ; , . 2 22 8 44 8 11 1 11, 6 77 0 44 , ,2 6 23, S 3 ,66 0 1,70 . 7 9 ,373 5 757 6 !/! i J 1 11J6 5 .60 , ,,3 "' 4 4 4 3 4' , ,4 5 41 9 14 7 4 , 5, 8 50 6 08 5 8 7 7, , 6 6 3 5 4 1 8 8, , 9 7 2 8 6 9 Mav. 16 to Apr. 15, 1917.31.162! 60.288;00216S,607'32.666,959 32,00Si34,693,542 .;231,777 127,648^0312,582 2,643,408 7,625 8,607 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 775 DISCOUNT OPERATIONS OF THE FEDERAL RESERVE BANKS. Discount operations of the Federal Reserve notes discounted, this share is nearly 98 per Banks for the month of June totaled $3,161,- cent. Of the $21,701,638 of 6-month paper 920,534, compared with $3,002,889,591 for May discounted during the month, Kansas City is and $750,270,739 for June, 1917, the month credited with 33 per cent, Minneapolis with marking the consummation of the first Liberty about 18 per cent, and Dallas with ovei 14 loan. Of the total bills discounted during the per cent. month, war paper—i. e., member banks7 notes, Average maturities of the paper discounted also customers7 paper supported by United during the month by all banks except Cleve- States war securities—constituted 82.9 per cent, land, Atlanta, and St. Louis were lower than compared with 84.8 per cent the month before the month before, the New York bank7s low and 83.2 per cent in April of the present year. average of 4.93 days apparently affecting to a Over 70 per cent of the total paper and nearly large extent the general average. Average 80 per cent of all the war paper discounted by rates for a majority of the banks, work the 12 banks during June are reported by the out at a higher level that the month be- New York bank. fore, the average June rate for all banks Discounts of member banks7 notes secured by being 4.42 per cent compared with 4.35 per eligible paper totaled $85,607,976, the Federal cent in May. For the New York bank the Reserve Banks at Chicago and Kansas City ac- average rate works out at 4.14 per cent as counting for $74,925,615, or 87.5 per cent of against 4.09 per cent in May, notwithstanding the total. Trade acceptances discounted dur- the shorter average maturity of all the paper ing the month by all the banks, except Minne- discounted, because of the larger amount of apolis, totaled $15,636,952, of which $3,701,509 90-day paper discounted during the later covered transactions in the foreign trade (all month. Kansas City and Minneapolis, because discounted fey the New York bank) and $11,- of the relatively large amounts of 6-month 935,443 transactions in the domestic trade. paper handled, report the highest average Over 23 per cent of the domestic trade accept- rates and longest average maturities. ances are reported by the Cleveland bank and On the last Friday of the month the banks about 17 per cent by the New York bank, while held a total of 869.2 millions of discounted Richmond, St. Louis, Chicago, Kansas City, paper, as against an aggregate of 896.4 millions and Boston each show over one million of this held on the last Friday in May and of 197.2 class of discounts. The totals just given are millions on the corresponding date in 1917. exclusive of $4,624,558 of foreign trade accept- Of the total discounts on hand the share of war ances purchased during the month in the open paper was 48.8 per cent, as against 62.8 per market. Other discounts, largely unsecured cent about the end of May and 70.9 per cent customers7 paper, also bills supported by other about the end of April. At the New York than Government war securities, totaled $439,- bank this share is nearly 64 per cent, and at the 252,253, compared with $399,091,341 for the Boston and Philadelphia banks as high as 70 month before and $322,585,211 for April of the per cent. Discounted trade acceptances held current year. by the Federal Reserve Banks about the close Fifteen-day paper, i. e., paper maturing of June totaled 16.5 millions, of which 1.5 within 15 days from date of discount with the millions represents the holdings of discounted Federal Reserve Banks, totaled $2,921,792,659, foreign-trade acceptances. Cleveland leads in or 92.4 per cent of the total paper discounted the amount of domestic trade acceptances during the month. For the New York bank, held, followed by St. Louis and New York. because of the larger proportion of collateral' Holdings of agricultural paper of all maturities Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

776 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. totaled 26.1 millions, or slightly over 3 per and the number of discounting members for cent of the total discounted paper held, while the month. live stock paper totaled 51.4 millions, of which over 52 per cent is reported by the Kansas Number of Number of City hank. member banks dis- Federal Reserve district. banks counting During the month, mainly as the result of on Juno 30. during June. further accession to membership of State banks and trust companies, the number of Boston 415 161 New York 688 328 member banks increased from 8,168 to 8,218. Philadelphia... 643 217 Cleveland 776 143 The total number of member banks accom- Richmond 543 255 Atlanta 416 218 modated during the month was 3,021, or about Chicago 1,167 421 St. Louis 488 l°A 37 per cent of the total membership at the Minneapolis... 821 3C4 Kansas'City... 975 307 close of the month. In the following exhibit Dallas "... 682 S27 San Francisco. 604 206 are given the nmmber of member banks in each Total... 8,218 3,021 Federal .Reserve district at the end of June Bills discounted by each Federal Reserve Bank during the month of June, 1918, distributed by classes. Member banks' collateral , Customers' notes. ; paper se- • cured by Secured by Federal Reserve Bank. • i U n b i o l t i e n b d d e s r S t o y t r atesUn b i l t o i e b n d e d r s S t y o ta r tes Otherwise acc T ep ra ta d n e ces. d A is l c l o o u th n e ts r . Total. ! certificates certificates secured. | ofindebtedof indebted- •i ness. Boston 859,635 $32,528,996 .11,515,211 11,034,742 $12,600,410 854,538,994 New York 19477,160 2,065,401,011 15.705,397 200,101,337 2,290,684,905 Philadelphia... 11.433,381 55,564,390 '451,466 27,311,419 94,760,656 Cleveland %023,126 35,938,230 ! 2,756,075 25,492,783 66,210,214 Richmond 324,045 101,978,577 I 1,475,750 1,285,817 19,458,289 127,522,478 Atlanta 21,447 29,029,252 I 2,260,000 419,352 19,620,158 51,350,209 Chicago 201,367 87,900,794 | 60,742.410 1,142,274 38,168,636 189,455,481 St. Louis 303,151 56,021,750 95;000 1,151,773 36,052,902 94,624,576 Minneapolis... 241,195 18.074,920 4,329,000 19,053,201 41,698,316 Kansas City... 394,283 31,995,278 14,183,205 1,082,090 15,786,777 63,441,633 Dallas 108,613 34,618,750 680,000 i 157,266 8,509,336 44,073,965 San Francisco. 392,640 25,591,362 327,400 ! 450,700 16,797,005 43,559,107 Total 1 46,780,043 2,574,643,310 85,607,976 ! 15,636,952 439,252,253 3,161,920,534 ] Includes §3,701,509 in the foreign trade. Amounts of discounted paper, including member banks' collateral notes, held by each Federal Reserve Bank on the last Friday in June, 1918, distributed by classes. [In thousands of dollars; i. e., 000 omitted.] Member banks' collateral ! Customers notes. I paper socured Banks. Ag p ri a c p u e lt r u . ral 1 i Li p v a e p -s e t r o . ck ! ; U b n b y it o e L n d d i b s S e t o r a r t t y es Se L c i u b r e e r d t y by Otherwise acc T ep ra ta d n e ces. d A is ll c o o u th n e ts r . Total. , certificates of United States secured. indebtedness. I certificates of j indebtedness. Boston 25,848 10,265 1,462 13,590 51,173 New York 54.106 I 110,999 364 1 3,763 90,033 259,265 Philadelphia.. 175 !. 19; 731 ! 22,872 1,330 888 15,221 60,217 Cleveland 221 ! 2,457 j 7,128 ! 12,565 376 3,027 30,404 56,178 Richmond 3,450; ' «; 4:977 I 25,808 2,450 3,401 15,810 53,904 C A h tl ic a a n g ta o 1 5 , , 2 1 3 5 1 9 ' ' . -, 708 ! ' 26; 4 1 0 2 , , 4 03 4 2 8 35,9 8 4 9 0 9 7 92 4 4 6 1 43 2 , , 5 6 2 0 9 3 1 2 2 8 6 , , 2 0 4 0 5 0 St. Louis 257 1 2,782 ! 922 ; 28,548 1,079 2.. 658 27,995 64,241 Minneapolis... 3,083 i 6,678 : 547 j 10,700 5,245 '298 i 17,999 44,550 Kansas City.. - 2,437 ! 27,011 i i88 ! 11,979 7,914 578 i 6,289 56,396 Dallas .*— 5,215 i 5;519 j. 12,128 478 3,826 27,166 San Francisco. 4,882 ! t[192 l 599 i 11.940 258 764 17,205 41,840 Total. 26,118 ' 124.072 : 310,281 56,333 ' :6.509 294,504 869,175 Per cent 3.0 i 1Z.1 ! 35.7 6.5 : 1.9 33.9 300 ?],525,393 in the foreign trade. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST l, 1918. FEDERAL RESERVE BULLETIN", 777 Bills discounted by each Federal Reserve Bank during June, 1918, distributed by rates of discount; also average maturity and rate of bills discounted by each bank during the month. 4 per cent. 4\ per cent. 4& per cent. 4: 4 ! per cent. Federal Reserve Bailie. i Amount. ! Discount. I Amount. ! Discount. ', Amount. Discount. I Amount. Discount. Boston ! 138,014,113 $43,746 $6,426,975 i S4S,689 ! 3828,623 $5,013 ! 89,260,692 i §63,229 New York !2,210,993,783 , 920,285 18,042,852 : 143,289 ' 1.099.413 9,192; 29,918,957 ! 200, 755 Philadelphia 78,107,604 105,762 11,588,001 70.400 ; ' 197; 871 1.611 I 4,877,585 j 32, Ii;> Cleveland 31,092,657 j 37,145 11,513,•107 29', Oil '• 1,906,855 12:586 I 21,690,369 149,763 Richmond ! i 105,292,522 100,622 : ' 145,889 225 I 6,110,624 17,300 Atlanta 43,676.218 65,030 I 20,297 163 514,093 3,298 I 6,546,653 48,310 Chicago 158.426', 942 ! 239,711 : 1,059,707 ! 7.221 932,907 8,163 ! 17,580,512 100; 773 St. Louis ' 73j 464; 459 111,342 ; 1,303,151 | 1(>; 946 1,099,442 7,998 16,697,606 112,728 Minneapolis ! 2 J, 933,147 38,389 I 191,193 j i;223 32,127 156 8,478,587 42,472 Kansas City 100,000 151 ! 31,344,061 51,554 : 16.007,415 29,879 i 764,215 3,826 Dallas 35,366,904 51,799 i 79,791 614 ' 157,266 858 i 2,669,629 14,244 San Francisco I 32,222,030 49,359 i 301,613 2,882 i 441,223 3,360 ; 8,311,760 73,921 Total % 750,397,857 1,063,319 I 187,749,090 400,014 : 23,303,124 82,339 I 132,907,219 865,435 5 per cent. o\ per cent. 5\ per cont. Total. ! Average Average Federal Reserve Bank. maturity, rate (per A mo Lint. Discount. Amount. I Discount. Amount. Discount. Amount. Discount in days". cent).' •-I- Boston IS, 591 $110 §54,538,994 S100,787 24.53 4.39 New York ; 29; 900 1,203 2,290,084,905 1,280,785 4.93 4.14 Philadelphia 9.595 187 94,760,656 210,073 19.06 4.19 Cleveland : 86,866 i Sill 66,210,214 228,610 27.31 4.55 Richmond 15,231,633 122,038 738,810 . 13,808 127,522,478 253,993 15.36 4.67 Atlanta 580,948 10,559 51,350,209 127,960 20. 65 4.34 Chicago 9,585.285 100.861 SI, 870,008 $37,779 189,455,481 500,508 21. 45 4.43 St. Louis i '..... 2,059,858 42,513 94,624,576 285,527 24.22 4.49 Minneapolis | i, 191,806 15,606 3,871,390 85,791 41,698,316 213,697 37. 64 4.90 Kansas City '• 8,089,600 71,921 7.136,282 150.532 03,441,633 307,863 34. 43 5.07 Dallas j 2,791,030 31,376 3,009,345 61,284 44,073,965 160,175 27.98 4.68 San Francisco • 2,282,481 44,314 43,559,107 173,836 30.90 4.65 Total 32,437,848 318,060 11,844,081 147,124 17,220,085 i 300,929 3,101,920,534 3,903,820 10.09 2 4. 42 1 Boston and New York calculated on 365-day basis; all other Federal Reserve Banks on 300-day basis. 2 Average discount rate on all paper discounted works out at 4.40 per cent if calculated on a uniform 360-day basis, and at 4.40 if calculated oa a uniform 365-day basis. Rediscounts and sales of bankers' acceptances between Federal Reserve Banks, from Jan. 1, 1918, to June 29, 1918. [In thousands of dollars; i. e., 000 omitted.] ]Rediscounted with or sold to Federal Reserve Bank of— Rediscounted or sold by Federal Reserve Bank of— Boston. d P el h p i h la i - a. C la le n v d e . - Atlanta. Chicago. St. Louis. M ap i o n l n is e . - K C a i n t s y a . s Dallas. Sa c n i s F co ra . n- Total. Boston: 3,760 3,760 March 2,530 5,054 2,555 5 037 15,176 New York: i 4,800 1,908 6,708 Febrii&rv 2,494 j 3,442 1,628 7,564 March 5,029 7,095 2,514 24,317 2,526 7,535 7.511 56,527 May - - 5,017 5,017 Richmond: Febniarv 5,017 1,994 1,480 1,468 9,959 Vpril 3,999 3,007 1 993 8,999 May 1.100 991 i,6io 931 978 5,010 Tune 635 653 1,770 823 3,881 Dallas: Mav 1,995 1,000 2,995 Total 1,735 20,214 22,440 2,514 31,072 2,526 14,563 14,016 8,242 8,274 125,5% Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

778 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. Rediscounts of customers' paper between Federal Reserve Banks, from Jan. 1, 1918, to June 29, 1918. [In thousands of dollars; i. e., 000 omitted.] Rediscounted with the Federal Reserve Bank of— Kodiscounted by Federal Reserve Bank oi— Phila- San Fran- ; Boston. delphia. Cleveland. Chicago. cisco. I Total. Richmond: May 1,829 2,038 1,948 2,023 June 1,862 1,935 3,925 3,440 11,162 Kansas City: June 4,168 4,362 8,530 Dallas: June.. 5,003 5,003 Total. 3,691 3,973 15,044 9,825 2,028 | 34,561 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 Date. Member N c o o n m tmr p ue a sm n t i b es e . r S N t o a n te m b e a m n b k e s r . P b r a i n v k a s te . j i • b F r b o a a a n r n e n c d i k h g e n s Total. a b c m c o e u o a p g p r t e k h a n e t n t c i . n es acce T p o ta ta n l ces. 1915. Feb. 22. $93,000 893,000 S93,000 Apr. 5.. 3,653,000 $7,820,000 810,000 .§110,000 j. 11,593,000 11,593,000 y 4 9 , , 3 0 4 00 2 , , 0 0 0 0 0 0 4 5 , , 8 2 9 6 8 7 , , 0 0 0 0 0 0 3 1 4 6 3 1 , , 0 0 0 0 0 0 I !. 1 9 4 , , 7 3 7 7 0 3 , , 0 0 0 0 0 0 1 9 4 , , 7 3 7 7 0 3 , , 0 0 0 0 0 0 Oct. 4. 1916. Jan. 3.. 15,494,000 7,160,000 362,000 822,000 i 23,838,000 23,838,000 Apr. 3. 21,000,000 13,572,000 473,000 3,262,000 38,308,000 S722,000 39,030,000 July3. 32,989,000 18,921,000 471,000 11,830,000 64,211,000 3,422,000 67,633,000 Oct. 2.. 37,798,000 : 21,782,000 712,000 9,944,000 70,236,000 2,306,000 72,542,000 1917. Jan.1 66,803,000 i 34,625,000 1,502,000 18,224,000 121,154,000 4,585,000 125,739,000 Apr. 2 43,979,000 : 20,328,000 689,000 16,830,000 3200,000 82.026,000 1,144,000 83,170,000 July 14-16.. 108,597,000 I 30,390,000 3,333,000 38,082,000 3,805,000 184,785,000 4,660,000 189,445,000 Sept. 29.... 131,997,000 14,987,000 2,193,000 21,708,000 2,286,000 173,171,000 6,942,000 180,113,000 Dee. 31 227,717,000 8,163,000 3,179,000 20,137,000 7,657,000 266.853,000 6,383,000 273,236,000 1918. Jan. 31 240,259,000 5,547,000 3,522,000 22,099,000 6,947,000 278,374,000 6,363,000 ! 284,737,000 Feb. 28 | 252,747,000 1,648,000 3,856,000 28,419,000 7,097,000 293,767,000 5,456,000 j 299,223,000 Mar. 31 i 275,144,000 1,360,000 1,884,000 31,779,000 8,562,000 318,729,000 8,015,000 i 326^ 744,000 Apr. 30 j 248,390,000 654,000 2,907,000 25,921,000 10,304,000 288,176,000 9,279,000 1 297,455,000 May 31 ! 207,917,000 1,330,000 5,168,000 26,217,000 8,398,000 249,030,000 8,276,000 I 257,306,000 June 29 1 173,698,000 1,992,000 459,000 21,478,000 12,315,000 209,942,000 7,418,000 ! 217,360,000 Acceptances bought in open market and held by each Federal Reserve Bank on June 29, 1918, distributed by classes of accepting institutions. fin thousands of dollars; i. e., 000 omitted.] Foreign Trade acceptances bought in Federal Reserve Bank. banks. P b r a i n v k a s te . br b a a a n n n c d k h s e , s,! Total. open market. a a T c n c o c e t e p a s l t . agencies. • Domestic.! Foreign. . Total. T Boston ! 19,809 ' 46 i 976 298 21,129 509 509 ! 21,638 New York ! 83,964 i 1,205 | 313 17,34S 11,215 114,046 1,766! 1,766! 115.812 Philadelphia ! 16,172 i 225 i 1,285 400 18,082 22 j 22 i 18;104 Cleveland | 12,— ! 855 140 13,980 27 ! 27 : 14.007 Richmond | 2,... £986 Atlanta i 4.031 4,031 4', 031 Chicago : 17,153 252 17,405 17,405 St. Louis. 23 3,118 3,118 Minneapolis 795 ! 795 795 KansasCity i 250 j 250 250 Dallas I 1,650 i 1,650 1,650 SanFrancisco 10,904 | 264 ' 50 ", 990 262 12,470 I 5,094 ; 5,094 17,564 Total j 173,698 ! 1,9 459 j 21,478 12,315 209,942 7,418 I 7,418 ! 217,360 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 779 Amounts of hills discounted and acceptances and warrants bought by each Federal Reserve Bank during June, 1918, distributed by maturities. 15-day maturities. 30-day maturities. Discounts. Acceptances. Warrants. Total. | Discounts. Acceptances.; Warrants. | Total. Boston 338,075,028 $595, S38,670,722 ! §2,322,329 $1,621,524 83,943,853 New York 2,239,798,723 1,062, 2,240,860,832 i 6,347,105 12,697,533 19,044,638 Philadelphia... 79,547,681 586, 80,133,998 ! 1,276,354 620,900 1,897,254 Cleveland 41,075,459 177, 41,253,438 4,438,622 865,118 5,303,740 Richmond 107,272,423 95, 107,367,423 3,265,143 1,190,710 4,455,853 Atlanta 43,687,270 60, 43 747270 1,337,881 375,149 •55,073 ! 1,718,103 Chicago 158,423,142 162,023,142 2,897,249 825,400 3,722,649 St. Louis 74,186,266 74,186,256 3,135,313 165,466 3,300,809 MinneapoJis... 24,933,147 24,933.147 2,872,739 2,872,739 Kansas City... 47,051,281 47,051,281 1,105,346 1,105,346 Dallas 35,376,905 100,000 35,476,905 845,857 350,000 I. 1,195,857 San Francisco. 32,365,344 2,067, 34,432,580 i 779,863 804,819 !. 1,584,682 Total.... .J2,921,792,659 8,344,335 .2,930,136,994 i 30,623,831 19,516,619 | 5,073 i 50,145,523 Percent. .: 90.0 . 1.5 i . : I 60-day maturities. 90-day maturities. j Discounts. I Acceptances. Warrants, Total. Discounts. I Acceptances. Warrants. Total. Boston $6,009,979 | §2,363,866 38,373,845 ! S8,123,067 84,652,482 $12,775,559 New York 19,365,652 | 9,540,708 28,906.360 : 25,143,525 16,267,212 41,410,737 Philadelphia- 1,282,268 9,891,194 i 5,318,101 5,164,110 10,482,211 Cleveland 12,111,563 2,548,334 14,659.897 i 8,577,705 4,033,779 12,611,484 Richmond 6,716,463 1,878,039 8,594;502 9,524,639 1,609,500 11,134,139 Atlanta 2,768,904 987,661 $4,500 3,761,065 2,964,580 1,196,129 4,1$, 709 Chicago 14,915,993 2,653,954 17,569,,947 i 11,347,962 ; 3,568,806 14,916,858 St. Louis. 8,487,866 9,024;605 6,755,253 58,350 6,813,603 " ""1.830 5,763;930 4,253,107 130,000 4,383,107 Kansas City... 3,691)840 3,691 840; 4,442,019 ; 4,442,019 S D a a n ll a F s rancisco. 1 1 , , 6 9 4 2 2 4 , , 2 3 6 1 4 5 1,2 9 0 3 4 0 , , 0 0 2 0 5 0 2 2 , , 8 8 5 4 4 6 ' ; ;315 : 6 2 , , 4 8 9 4 4 9, , 9 8 2 3 2 1 i 4,410,139 I 1 2 0 , , 8 9 4 0 9 4 , , 9 9 2 7 2 0 Total. 92,007,695 j 23,925,594 4,500 115,937,789 ! 95,794,711 ! 41,090,607 136,885,318 Percent 3.6 l 4.2 Over 90-day maturities. Total. Per cent. co D u i n s- ts. A a c n c c e e p s t . - r W an a t r s . . Total. Discounts. A a c n c c e e p s t . - r W an a ts r , - j I Tlonttaqll< j I c D ou is n - ts, Accept- r W an a t r s - . Total. J i Boston 88,591 §163,213 ! .! §171,804 $54,538,994 j$9,396,789 863,935,783 | 85.3 14.7 100 New York 29,900 29,900 2,290,684,905 139,567,562 2,330,252,467 | 98.3 1.7 100 Philadelphia... 9,594 •*i2O,"666"i .; 129,594 94,760,656 ! 7,773,595 102,534,251 ! 92.4 7.6 100 Cleveland 6,865 6,865 66,210,214 ! 7,625,210 73,835,424 : 89.7 10.3 100 Richmond 743,810 ..: 743,810 127,522,478 ; 4,773,249 132,295,727 ! 96.4 3.6 100 Atlanta 591,574 145,000 .: 736,574 51,350,209 i 2,763,939 S9,573 54,123,721 ! 94.9 5.1 100 Chicago 1,871,135 100,000 . 1,971,135 189,455,481 10,748,250 200,203,731 I 94.6 5.4 100 St. Louis 2,059,858 . 2,059,858 94,624,576 760,555 95,385,131 99.2 .8 100 Minneapolis... 3,875,393 . 3,875,393 41,698,316 130,000 41,828,316 99.7 .3 100 Kansas City.. . 7,151,147 . 7,151,147 63,441,633 63,441,633 i 100.0 100 Dallas 3,076,966 . 3,076,966 44,073,965 1,380,000 45,453,965 ; 97.0 3.0 100 San Francisco. 2,276,805 55,500 ! . 2,332,305 43,555599,110077 ; 885,544117,71199 52,100,826 | 83.6 16.4 100 Per ce T nt otal. 21,701,638 583,713 !-' 2 i 2, 28 0 5, . 35 7 1 3,161,920,534 9,573 13,255,390,975 : 97.1 2.9 100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

780 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. Maturities of discounts, acceptances, and municipal warrants held by each Federal Reserve Bank on Friday, June 28, 1918. [In thousands of dollars; i. e., 000 omitted.] 1 to 15 days. 16 to 30 days. Banks. Acceptc B o i u ll n s t d ed is . - b a o n u c g e h s t. 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 . - M wa u r n r i a c n ip ts a . l Total. Boston : 14,517 1,872 16,389 ; 5,241 6,013 11,254 New York 176,584 19,739 196,323 : 16,568 38,552 55,120 Philadelphia 36,330 4,229 40,559 • 2,324 4,727 7,051 Cleveland - 24,181 3,874 28,055 8,386 3,223 11,609 Richmond. 33,919 ! 902 34,821 7,113 1,639 8,752 Atlanta 20,044 | 890 20,940 ! 2,162 649 2,816 Chicago : 81,947 • 2,523 84,470 : 12,110 5,287 17,397 St. Louis 41,262 332 41,594 5,213 1,021 6,234 Minneapolis 21,046 I 21,046 3,953 485 4,438 Kansas City • 24,670 | 250 i 24,920 1,578 1,578 Dallas 14,450 ! 370 : 14,820 1,044 300 1,344 San Francisco 20,248 4,695 24,943 i 5,168 3,815 8,983 Total 509,198 j 39,670 548,880 70,860 65,711 136,576 Per cent ! 50.5 12.6 31 to 80 days. 61 to 90 days. Banks. B co il u l n s t d e i d s . - b A a o c n u c c g e e h p s t t - . 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 . - b A a o c n u c c g e e h p s t t . - M wa u r n r i a c n ip ts a . l Total. Boston 26,320 9,431 35,751 4,978 4,322 9,300 Ne-.v York 51,836 47,679 99,515 14,275 9,843 24,118 Philadelphia... 18,350 6,573 24,923 3,193 2,575 5,768 Cleveland 15,482 3,481 18,963 8,090 3,402 11,492 Richmond 7,590 292 7,882 3,531 113 3,644 Atlanta 3,312 1,478 4,790 1,687 1,114 2,801 Chicago 13,548 6,662 20,210 14,737 3,942 18,679 St. Louis...... 11,714 1,717 13,431 4,307 51 4,358 Minneapolis... 7,618 180 7,798 4,068 130 4,198 Kansas City... 5,880 5,880 7,370 7,370 Dallas 2,865 980 3,845 2,803 2,803 San Francisco. 7,294 5,6 12,902 4,970 1,887 6,857 Total. 171,809 84,081 !. 255,890 74,009 27,379 101,388 Per cent 23.6 9.3 Over 90 days. Total. Banks. co B u di i n s l t l - s ed. A a c n c e e e p s t - I j rant. Total. co B u di i n s ll t - s ed. 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. co B u di i n s l t - l e s d. b A a o c n u c c g e e h p s t t - . M r w i a p u a n n a r t i l - s c . - Total. Boston 117 117 51,173 21,638 72,811 70.3 29.7 100 New York 2 2 259,265 115,813 375,078 69.1 30.9 100 Philadelphia 20 20 60,217 18,104 78,321 76.9 23.1 100 Cleveland 39 39 56,178 13,980 70,158 80.1 19.9 100 Richmond 1,751 1,751 53,904 2,946 56,850 94.8 5.2 100 Atlanta 1,040 1,040 28,245 4,131 32,387 87.2 12.8 100 •Chicago 3,658 3,658 126,000 18,414 144,414 87.2 12.8 100 St. Louis j 1,745 1,745 64,241 3,121 67,362 95.4 4.6 100 Minneapolis 7,865 7,865 44,550 795 45,345 98.2 1.8 100 Kansas City 16,898 16,898 56,396 250 56,646 99.6 0.4 100 Dallas.: 6,004 6,004 27,166 1,650 28,816 94.3 5.7 100 San Francisco 4,160 4,160 41,840 16,006 57,846 72.3 27.7 100 Total | 43,299 43,299 >9,175 216,848 1,086,034 Per cent I 40 80.0 20.0 100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KT 1,11)18. FEDEBAL BESEE.VE BULLETIN. 781 Total investment operations of each Federal Reserve Batik during the months of June, 191S and 1917 Bills dis- Bills bought in open market. Municipal warrants. counted for Federal Reserve? Bank. members and s F e e rv d e e r B al a n R k e s - . B c a e n p k ta e n rs c ' e a s c . - c T e r p a t d an e c a e c s - . \ j Total. City. I State. ot A he ll rs. Total. Boston S54,538, 994 §9,138,119 ! §258,670 i §9,396,789 j New York : 2,290,684,905 38,990,387 j 577,175 | 39,567,562 " Philadelphia ! ' 94,760,656; 7,773,595 7,773,595 Cleveland • 66,210,214 I 7,587,466 27,744 ! 7) 625,210 : Richmond 127,522,478 | 4.773,240 4,773,249 : Atlanta • 51.350,209 ! 2:763,939 i ' 2,763,939 ! So, 073 : $4,500 SO,573 Chicago ! 1891455,481 I 10.748,250 I : 10,748,250 • St. Louis i 94,624,576 i '760,555 j • 760*. 555 i Minneapolis | 41,698,316 ! 130.000 ! 130)000 Kansas Citv I 63,441,633 ; • Dallas.....' 44,073,965 ! 1.380,000 i 1,380,000 San Francisco 43,559,107 i 4.780,750 | 3,760,969 ! 8.541.719 ; Total, June, 1918 3,161,920.534 88.836,310 ; 4,624,558 I 93,460,868 j 5,073; | 4,500 ! 9,573 Total, June, 1917 ; 750,269,838 132:481,554 ; 2,748,143 | 135,229,697 |. 4,925 ! 4,925 Total investment opera- United States securities. tions. Federal Reserve Banks. j United i 2 per cent. 3 c e p n e t r . H c en pe t. r 4 c e p n e t r . 4 c .1 e n p t e . r nnipcs I tificatesof Total. | June, 1918. | June, 1917.1 notes- ^indebtedness Boston : j§2,623,85C I SI00 ; :. 623,950 ! 666,559,733 j 854,762,507 New York i I 3,274,000 186,717,000 !- 5389,799,000 790,000 12,730,042,467 j 639,974,965 Philadelphia §400,000 '. ! !. 3,943,000 343;000 i 106,877,251 ! 46,166,378 Cleveland I 5,000 I i ; 1.032,000 037)000 j 74,872,424 14,28(5,956 Richmond I 132) 295,727 34,386,530 Atlanta 55,000 ! 55,000 | 54,179,327 4,300,048 Chicago ; 40,000 | 40,000 200,243,731 45,394,072 St. Louis i j ! 95,385.131 5,543,937 Minneapolis : • j 15,000 : ! 20,043.000 20,058,000 61,886)316 10,497,832 KansasCity ! 4,550 . 8.100 • \ 50',000 62,650 63,504.283 19,706)619 Dallas " ' ' 42,499)760 3,773,121 e?an Francisco : ' j } 50 838,500 838,650 52,939.476 11,709.395 Total, June, 1918 405.000 : 2,628,40G I 3.297.350 ! 6,717,000 | 415,800,500 1428.848.250 3,684,239,225 Total, June, 1917 j '.....j 1,232)900 | ' 9)000 i $756,000 I | i])997,'900 887,502,360 3 Exdxis-ve of purchases of Treasury certificates of indebtedness. United States securities held by each Federal Reserve Bank on June 29, 1918, distributed, by maturities. Other United States securities, including^ 1-year Treasury notes and United States p b ri o v n il d e s g w e. ith circulation r T e r s e e a r s v u e r y b a c n e k rt i n fi o c t a e t s e s u n o d f e in r d s e il b v t e e r d n ac e t s s o a f v A ai p la r. b l 2 e 3 a , s 1 s 9 e 1 c 8 u . rity for Federal Feder B a a l n R k e . serve 2 c p on e s r o o l e s n o t f l ! jgj* 3 l p o e a r n c o e f n t* | p lo e a r n c o c f j sion lo 3 c a e p n n e t o r f | ; i c e e r 3 n t ^ y t p L l e o i r a b n - j | I 4 L l p o i e a b r n e c r o e t f y nt L 4 i c 1 b e e p n r t e ty r ; | t S if t U i a c t n a e i t s t e e s c d c o r f - i Total. 1930. l 1 1 9 9 3 3 6 8 - . 1918. 1925. b 1 o 9 n 4 d 6 s -4 o 7 f . 1961. ! of"1947. 1942-1947 lo 1 a 9 n 2 8 o . f ' I ' ind n e e b ss t . cd- Boston $750 | i | $529,000 $1,416,000 ; 182,683,859 S20,550 84,656,150 New York 50 ' §50,000 j 11,255,400 2.226,000 ' 206,850 10,650 $190,769,000 194,517,950 Philadelphia I 8100 400.000 1 549,200 1)537,000 11,850 786,250 ; 106,000 3.390,400 Cleveland i : 658)660 81,978,200 | 414,800 2,660,000 1.966,650 374.550 811,150 i 209,000 10)333,010 Richmond ! 915,100 237,000 1,513,000 ' 42,850 37) 750 2,745,700 Atlanta 240,600 ; 21,000 '.'.'.'.'.'.'.'.'.'.!!"".!".!!!""io,"366" 1,141,000 ! 13,350 440,400 4,650 j 30,500 1,901,800 Chicago 1,862,500 .367,300 581,000 1.768,000 j 427)400 2,962,000 i 83,050 10,051)650 St. Louis 100 ! 080,000 .'. jl,153,300 511,000 j 2,744,400 Minneapolis 4,300 ! 16,260 199,180 : ! 114,800 880,000 ! 500 50 2,710 : 2,428,500 4,646,300 Kansas City j7,155,850 22.240 i 825,000 i 838,500 1,374,000 I 27,150 8,100 I 367,500 10,618,340 Dallas \2,450,900 28l) 500 ! 11,233,600 1,430,000 ! 700 2,200 11,950 : 34,500 5,445,350 San Francisco 2,428,750 : 1,500,000 ! 21,450 10,950 32,500 3,993)650 Total. 15,058,900 !945,400 17,968.840 J4,571,200 6,520,300 jl9,150,000 j 900 4,974,750 ll, 780,450 30,460 i 194,037.500 255,044,700 i I : ' ' Total Unite;! States bonds with circulation prWitags, ?2?,!>i4,340. Othor United Slates securities, 8226,500,360. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

782 FEDERAL RESERVE BULLETIN. AUGUST 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, June 28 to July 19, 1918. RESOURCES. [In thousands of dollars; i. e., 000 omitted.] I 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 - . Atlanta. 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 i r s a a c n n o - . Total. Gold coin and certificates in vault: June 28 300,170 158 22,782 6,490 6,765 27,489 1,742 8,463 70 6,007 419,907 July 5 3,619 302,005 67 31,002 6,430 6,799 26,929 1,591 8,581 258 6,084 28,562 421,927 July 12 8,077 ! 303,998 94 34,644 6,384 6,810 26,940 1,799 375 6,124 19,190 422,738 July 19 8,596 j 305,419 589 39,186 6,440 6,793 1,781 8,536 i 272 6,174 17,537 Gold settlement fund, Federal Reserve Board: i June 28 61,062 222,645 46,892 46,549 16,382 19,207 7,969 | 22,452 ! 8,125 27,486 8,730 3,926 I 491,425 July 5 61,019 204,277 47,019 45,145 14,077 17,042 65,889 ! 23,314 \ 5,418 26,642 10,996 3,465 | 524,303 July 12 73,365 119,091 54,590 64,566 20,504 20,768 59,932 ! 25,260 |14,609 33,600 12,783 25,157 ; 524,225 July 19 41,480 234,747 51,029 35,965 16,614 11,188 54,923 25,910 I15,311 28,756 12,435 j 27,796 556,154 Gold with foreign i agencies: June 28 1,132 5,579 1,132 1,455 570 485 2.263 ! 647 647 910 566 16,275 July 5 1,132 5,579 1,132 1,455 566 485 2.264 ! 647 647 910 566 16,272 July 12 1,085 5,346 1,085 1,395 542 465 620 620 542 852 15,529 July 19 1,084 5,347 1,085 1,395 542 465 2,169 620 620 775 542 852 15,496 Gold with Federal Reserve agents: June 28 62,348 265,795 93,053 116,916 32,287 33,202 182,279 39,004 26,012 33,679 14,045 89,250 i 987,870 July 5 62,053 280,678 95,637 119,584 33,250 29,464 154,045 26,124 25,852 33,651 87,692 ; 962,075 July 12 56,964 280,282 99,155 115,611 33,115 30,250 152,540 31,599 23,852 33,651 92,093 i 963,147 July 19 56,651 280,282 100,778 106,672 33,115 30,872 139,597 31,553 23,718 33,588 14^010 89,454 940,290 Gold redemption fund: June 28 2,453 15,000 3,500 1,091 2,597 2,932 1,654 1,644 1,252 216 33,544 July 5 2,726 15,000 3,500 1,350 195 2,718 3,064 1,946 1,723 1,036 1,251 24 34,533 July 12 2,799 15,000 3,500 823 138 2,944 3,177 1,946 1,799 1,036 1,251 34,413 July 19 3,035 14,754 3,500 975 444 2,121 3,409 2,226 1,900 1,040 1,251 •! 34,655 Total gold reserves: June 28 130,084 144,735 188,793 55,965 62,256 222,932 65,499 44,891 63,114 30,600 130,963 I 1,949,021 July 5 130,549 807,539 147,355 198,536 54,518 56,508 252,191 53,622 42,221 62,497 32,942 120,632 ; 1,959,110 July 12 142,290 723,717 158,424 217,039 60,683 61,237 244,758 61,224 49,183 69,470 34,735 137,292 i 1,960,052 July 19 110,846 840,549 156,981 184,193 57,155 51,439 227,628 62,090 50,085 64,431 34,412 135,639 i 1,975,448 Legaltender notes, I silver, etc.: June 28 2,828 43,934 ! 552 352 746 4,433 ! 1,011 86 1,996 409 57,178 July 5 2,687 44,142 I 534 358 401 596 4,081 \ 779 89 247 1,816 323 ! 56,053 July 12 3,152 44,696; 386 389 404 590 2,829 : 1,039 107 . 357 1,685 298 : 55,932 July 19 2,953 44,420 695 373 610 588 2,618 897 220 308 1,754 211 , 55,647 Total cash reserves: Juno 28 132,912 853,123 145,287 189,145 56,463 63,002 227,365 66,510 44,977 63,447 32,596 131,372 I2,006,199 July 5 133,236 851,681 147,889 198,894 54,919 57,104 256,272 54,401 42,310 62,744 34,758 120,955 2,015,163 July 12 145,442 768,413 158,810 217,428 61,087 61,827 247,587 62,263 49,290 69,827 36,420 137,590 2,015,984 July 19 113,799 157,676 184,566 57,765 52,027 230,246 50,305 64,739 36,166 135,850 2 031,095 Bills discounted for members and Federal Reserve Banks: June 28 51,173 259,265 60,217 56,178 53,904 28,245 126,000 64,241 44,550 56,396 27,166 41,840 869.175 July 5 72,507 362 022 71,246 72,560 58,477 32,499 152,814 64,482 50,980 60,747 27,958 50,490 1,076,782 July 12 85,324 413,001 67,184 88,654 58,116 31,353 169,439 53,527 52,567 28,761 49,103 1,159,882 July 19 86,173 409,170 71,909 90,514 57,761 33,749 191,461 57.150 51,399 68,860 31,852 53,348 1,203,346 Bills bought in i open market: June 28 21,638 115,813 18,104 13,980 2,946 4,131 18,414 3,11 795 250 1,650 16,006 216,843 July 5 22,241 112,416 16,756 12,806 3,618 3,931 18,831 2,948 825 3 1,630 15,942 211,947 July 12 26,267 113 256 12,931 3,777 4,020 19,251 2,962 825 70 1,380 17,692 218,464 July 19 24,683 104,561 12,157 15,556 3 221 3,642 18,368 2,493 410 129 1,550 19,162 205,932 Jnited States Government long-term securities: June 28 616 1,51. 1,747 7,404 1,233 730 7,090 2,233 1,338 8,877 3,981 3,461 40,22/ July 5 3,240 1,515 1,747 7,304 1,233 730 7,090 2,233 1 338 8,877 3,981 3,461 42,749 July 12 940 1,510 1,748 7m 1,233 | 730 7,090 2,233 1,317 8 877 3,979 3,462 40,273 July 19 1,129 1,559 1,747 1 233 ! 730 7,090 2 234 1,317 8,877 3,979 3,461 40,259 United States Government short-term se- I curities: fe June 28 1,416 197,995 1,643 2,929 '• 1,513 ! 1,171 2,960 511 3,959 1,742 1,465 1,533 218,839 July 5 1,416 2,670 1,287 2,029 I 1,285 996 2,112 321 1,229 1,536 936 1,533 17,350 July 12 1,416 18,244 1,184 1,900 ! 1,510 ! 975 2,112 321 1,113 1,217 901 1,030 31,923 July 19 1,416 3,178 1,182 1,660 | 1,510 i 985 2,112 1,218 901 1,004 16,358 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 783 Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve system at dose of business on Fridays, June 28 to July 19, 1918—Continued. RE S OURCE S—Continued. [In thousands of dollars; i. e., 000 omitted.] Boston. Y N o o 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 - . Atlanta. 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 S ra an n- Totai. ClSCO. All other earning assets: June 28 11 4 8 9.2 July 5 .... 10 4 12 : 26 J J u u l l y y 1 1 2 9 5 o 1 i ; ! ! 15 : ....... 3 1 2 6 . ... Q 7 « 2 Total" earning assets: June 28 74,843 574,590 81,711 80,491 59,596 34,288 154,466 70,106 50,646 67,265 34,270 62,840 p, 345,112 July 5 99,404 478,623 91,036 94,699 64,613 38,166 180,847 69,984 54,376 71,163 34,517 71,426 0,348,854 July 12 113,947 546,062 86,149 110,639 64,636 37,083 197,892 59,043 55,822 73,017 35,037 71,287 "1,450 614 July 19 113,401 518,519 86,995 114,633 63,725 39,101 219,031 62,198 54,017 79,084 38,314 76,975 1,465,993 Due from oilier Federal Reserve Banks, net: June 28 14,334 6,166 4,415 1 136 340 2,513 2,860 110,632 July 5 July 12 July 19 Uncollected items: June 28 27,634 103,687 | 44,808 47,121 36,355 32,081 107,169 34,013 8,000 40,993 23,873 24,985 530,719 July 5 July 12 July 19 Total deductions from gross deposits: June 28 27,634 118,021 50,974 51,536 36,355 32,081 108,305 34,013 8,340 43,506 23,873 27,845 520,087 July 5 46,278 175,098 80,021 59,397 46,101 29,519 96,783 27,153 14,481 42,988 19,293 32,145 669,257 July 12. 42,184 169,308 62,854 46,674 39,598 31,963 91,578 34,456 13,697 51,511 16,043 40,544 640,410 July 19 45,545 144,889 71,137 64,436 47,147 32,676 98,505 37,112 15,687 53,167 15,202 33,085 658,588 5 per cent redemption fund against Federal Reserve bank notes: June 28 14 100 400 137 84 735 July 5 i 14 100 390 137 84 725 July 12 I i 14 100 400 137 84 735 July 19 i 14 100 416 137 84 751 All other resources: June 28 July 5 1,108 1,460 1,418 674 639 591 1,136 711 213 344 535 1,334 10,163 July 12 1,173 1,590 1,113 600 806 600 1,155 553 249 344 478 1,318 9,979 Julv 19 772 1,668 1,212 574 929 629 1,167 526 245 413 516 1,244 9,695 Total resources: June 28 235,389 1,545,734 277,972 321,172 1S2,414 129,385 490,236 170,629 103,963 174,618 90,876 222,141 3,872,133 July 5 280,026 1,506,862 320,364 353,664 166,272 125,394 535,138 152,249 111,380 177,629 89,240 225,944 4,044,162 July 12 302,746 1,485,373 308,926 375,341 166,127 131,487 538,312 156,315 119,058 195,099 88,115 250,823 4,117 722 July 19 273,517 1,550,045 317,020 364,209 169,366 124,447 549,049 162,823 120,254 197,819 90,335 247,238 4,166,122 LIABILITIES. Capital paid in: J J u u n ly e 2 5 8 6 6 , , 4 4 7 7 4 4 1 1 9 9 , , 8 9 4 5 6 4 6 6 , , 9 9 3 3 9 9 8 8 , , 5 5 6 8 1 5 3,824 3 3 , ,0 0 5 4 3 5 9 9 ' . , 7 8 8 9 34 3 3 , , 6 6 0 0 7 7 2 2, , 8 8 1 0 8 2 3 3 , , 5 5 3 3 2 2 2 2 , , 9 9 9 9 1 2 4 4 , , 4 4 4 7 8 7 7 7 5 6 , ,1 8 6 5 3 8 July 12 6,474 19,954 6,039 8,595 3,115 9,886 3,608 2,829 3,540 2,997 4 489 70,324 Julv 19 6,474 19,967 6,939 8,604 3,115 9,919 3 604 2,830 3,541 2,998 4,493 7(5,383 Surplus: June 28 75 049 116 40 216 38 1,134 Julv 5 75 649 116 40 216 38 1,134 Julv 12 75 649 116 40 216 38 1,134 July 19 75 649 116 216 1,134 Government deposits: June 2S 3,832 21,736 1,392 10,278 6,349 7,094 6,249 5,089 2,416 4,006 6,201 9,893 84,535 July 5 14,979 15,042 10,773 17,684 10,131 9,253 15,512 9,917 7,185 6,118 4,359 7,445 128,398 Julv 12 16*100 7,508 2,261 30,051 8,919 12,682 30,743 13,774 12,412 17,047 2,764 15,066 169,393 July 19 15,532 31,339 4,886 16,921 10,861 3,200 20,321 1,578 10,295 6,561 14,447 144,828 Due to membersreserve account: June 28 82,724 767,013 86,805 110,886 41,868 35,772 177,921 48,180 36,998 65,723 36,214 67,483 1,557,587 July 5 86 811 610,251 85,422 103,428 40,642 37,717 173,096 42,838 35,980 55,477 35,760 62,275 1,369 697 July 12 87,860 651,547 93,630 100,198 42,849 35,408 178,775 47,698 37,167 62,484 35,250 66,480 1,439,346 July 19 93,439 (J61J336 100,609 110,019 43,795 40,082 184,316 44,686 37 568 65,773 33,641 72,783 1,488 047 i Difference between net amounts due from and net amounts due to other Federal Reserve Banks==net amount due to other Federal Reerve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

784 EESEKVE BULLETIN. AUGUST 1, 1918. Resources and liabi of each Federal Reserve Bank and of the Federal Reserve system ai close of business on Fridays, June 28 to July 19, 1918—Continued. LIABILITIES—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 - . Atlanta. Chicago. Lo S u t. is. apSis. K C a i n ty sa . s Dallas. F c S i r s a a c n n o - . Tola?. Collection items: June 28 20,411 53,191 27.200 22.049 25,239 35,778 23.630 5.. S57 17,870 7.87S 11,924 286,302 Jnlv 5 51,733 150,802 (K 732 of)! 669 S3!848 17,832 (55,056 27!282 8! 0.16 20,992 12'. 020 15,699 527,580 J Jn u l i v V l 1 2 9 3 « 4 9 , , 7 3 7 0 3 7 1 9 1 8 5 , , 0 3 7 6 7 9 4ft!192 M 58 . : 1 0 8 4 3 3 3 3 3 2 , , 0 2 8 0 - 8 5 2 2 2 0 , , 8 9 2 0 0 1 4 5 3 8 , , 5 3 5 3 0 8 2 So 2 , ! 0 1 0 7 7 2 _8;2S2 3 2 0 5 . , 4 7 8 4 0 5 13^070 2 1C 7 , , 4 2 4 1 8 8 4 4 7 8 7 0 . ! 5 3 2 4 6 1 Due to other Federal Reserve P-QnlvS, net: 9 0-1** ?. 254 1 Q47 23 FM) 4 617 Julv 5 Julv 12 : ! . Julv IP.- . : ! , j . . - ! Other deposits, including foreign : government i credits: I June 98 ! 114 025 12 -i 351 121,482 J \\\\i 5 .. . . 110' 717 ! "TO. Irl! A~'* 13 '1 8-11 •Tub- 12 . 102' 14* 33.1 8 ii 9.'AXF> 143 23 2,637 107!S09 Tota J l n lv g r 1 o 9 s s . de- •'•• -i r. 0 23'"* 22 3,690 1,2'. 052 posits: June 28 116,015 955,965 123,466 148.620 73,520 70,064 224,299 100.651 45.312 87,599 54,910 91,878 2,049,906 July 5 153,523 886,812 158,926 176!900 84,621 64,809 257,266 SO', 098 5i;230 88,587 52,152 88,260 2,143,184 Julv 12 173.333 859,280 145,677 194;763 84,862 70.916 255,553 83,793 57,883 105.276 51,107 111,631 2,194,074 July 19 143;744 913,650 151.687 385,293 86.864 61; 189 20o! 108 88,870 5«, 707 106! 548 53,470 107,138 2,225,268 Federal Reserve notes in actual circulation: June 28 112,533 562,848 147,430 162,918 74,525 56,139 252,639 65,662 55,213 74,396 32,626 125,287 1,722,216 July 5 118,328 591,791 155,360 166'.-778 76,478 56,826 263,271 67,617 56!478 75,871 33,328 131,443 July 12 121,153 598,007 155.357 170!477 76,128 56,709 267,879 67,932 57; 430 76,553 33,190 132,610 1*813!425 July 19 121,466 607,890 157'. 34C 368,737 77.316 56,366 268,790 69,314 57.749 77,938 32;984 133,175 1,829^045 Federal Reserve bank notes in circulation—net liability: June 28 50 2 000 8,000 340 10.390 July 5 ! 95 2,000 8.000 540 j 10.635 July 12 j 110 2,000 8*665 690 10.800 July 19 110 2,000 ! s.ooo 890 i 11.000 All other liabilities: June 28 292 6,426 137 1,073 429 47 1,293 706 598 1,091 349 188 12,629 July5 1,626 7,656 1,139 3,401 1,159 571 2,551 927 816 1,639 768 1,224 21.477 Julv 12 1,711 7,483 953 1,506 1,123 597 2,778 982 878 1,730 821 1,403 21,965 July 19 1,758 7,889 1,054 3.59f 1,171 627 3,016 1,035 930 883 1,542 23,262 Total liabilities: June 28 235,389 1,545,734 277,972 321,172 152,414 129,385 490,236 170,629 103,963 174,618 90,876 222,141 3,872.133 July 5 280,026 1,506,862 320,364 353,664 166,272 125,394 535,138 152,249 111,380 177,629 89,240 225,944 4,044; 162 July 12 302,746 1,485,373 308.926 375,341 166,127 131,487 538,312 156,315 119,058 195.099 88.115 250,823 4,117.722 Julv 19 273,517 1,550.045 317! 020 364.206 169.366 124.447 549,049 162.823 120,254 397; 819 90;335 247,238 4,166', 122 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

785 AUGUST 3,1018. FEDERAL RESERVE BULLETIN. FEDERAL RESERVE NOTES, Federal Reserve note account of each Federal Reserve Bank at close of business on Fndays, June 28, to July 19, 1918. [In thousands of dollars, i. a., 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 - . Atlanta. Chicago, jst. Louis,; *§•»« Daila, F S r a a n n- Total. cisco. i Federal Reserve notes received ! from agent—net: ! i June 28 118,673 • 612,286 159,813 169,896 80,392 58,033 278,454 71,128 !56,458 79,575 I 33,863 134,454 1,848,823 July 5 121,993 i 636,367 168,197 179,064 81,434 58,745 285,220 73,085 i 57,598 81,837 34,016 139,596 1,917,152 July 12 124,404 ! 659,847 168,715 181,791 81,630 58,831 296,715 72,505 !58,789 82,359 33,957 144,177 1,963,729 July 19 126,951 : 665,099 170,345 ! 184,852 82,832 58,203 298,771 73,353 |59,264 84,057 33,795 145,638 1,982,603 Federal Reserve notes held by bank: June 28 4,140 49,438 12,183 6,978 5,867 1,894 23,815 5,464 i 1,245 5,179 1,237 ! 9,167 126,607 July 5 3,665 ! 44,576 14,837 12,286 4,956 1.919 21,949 5,468 i 1,120 5,966 688 ! 8,153 125,583 July 12 3,251 : 81,840 13,358 11,314 5,502 2,122 28,836 4,573 I 1,368 5,806 767 i 11,567 150,304 July 19 5,125 57,209 13,005 16,135 5,316 1,837 29,981 4,042 ! 1,515 6,119 811 12,463 153,558 Federal Reserve notes in actual circulation: June 28 112,533 562,848 147,430 j 162,918 74,525 56,139 252,639 85,662 55,213 74,398 32,628 125,287 1,722,218 Julv 5 118,328 591,791 153,360 j 186,778 76,478 56,826 263,271 67,617 56,478 75,871 33,328 131,443 1,791,569 July 12 121,153 : 598,007 155,357 j 170,477 78,128 56,709 287,879 67,932 57,430 76,553 33,190 i 132,610 1,813,425 July 19 121,466 607,890 157,340 | 188,717 77,318 56,366 268,790 69,314 57,749 77,938 32,984 | 133,175 1,829,045 Gold deposited with or to credit of Federal Re- ! | serve as;ent: Juno 28 62,348 265,795 93,053 | 116,916 32,287 33,202 182,279 39,004 ;26,012 | 33,679 14,045 j 89,250 987,870 July 5 62,053 280,678 95,637 ! 119.584 33,250 29,464 154,045 26.124 25,852 j 33,651 14,045 !87,692 962,075 Julv 12 58,964 : 280,282 99,155 i 115,811 33,115 30,250 152,540 31', 599 .23,852 ; 33,651 14,035 ;92,093 963.147 July 19 56,651 280.282 100.778 ! 106,672 33,115 30.872 139,597 31. 553 '23.718 ! 33,588 14,010 I 89,454 940,290 Paper delivered to Federal Reserve ascent: June 28 72,811 ; 375,078 72,474 i 70,158 56,185 25, oZ5 134,511 54;570 39,342 | 51,569 28,816 50,583 1,031,612 July 5 94,748 474,438 77.950 ! 85,130 61,170 30,067 162,016 50,539 46,837 ! 54,650 29,588 57,850 1,224,983 July 12 111,591 526,257 71,354 ! 96,705 81,489 29^ 747 179,265 44,462 46,837 i 57,084 30,141 58,109 1,313,041 July 19 110,856 5-3,730 74;509 I 103,495 60,226 29.642 202,533 49.495 47,756 i 88,9S9 33,402 62,093 1,356,726 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

786 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. Federal Reserve note account of each Federal Reserve agent at close of business on Fridays, June 28 to July 19, 1918. [In thousands of dollars; i. e., 000 omitted.] i Boston. Y N o e r w k . I d P e h lp il h a i - a. C la le n v d e . - m R o ic n h d - . Atlanta. Chicago. St. Louis. M ap i o n l n i e s. - K C a i n ty sa . s Dallas. : F c S i r s a a c n n o - . • Total. 1 i | FEDERAL RESERVE NOTES. Received from Comptroller: June 28 160,640 i 937,080 208,240 209,600 111,920 78,740 341,720 93,200 75,980 104,700 68,500 145,500 2,535,820 July 5 ; .. 163,040 956,480 218,240 209,800 112,220 96,740 353,520 94,200 75,980 107,700 68,500 150,700 2,607,120 July 12 174,840 994,480 229,520 220,300 113,120 96,740 354,240 98,800 77,982 107,700 68,500 155,380 2 691,600 July 19 : 184,640 1,007,080 230,240 222,700 114,720 96,740 370,580 102,800 77,980 109,700 68,500 150,980 2^ 742,660 TX>V At? 4lr* I1X1 1i* 1it1 taj \/1I Li~'U r% Comptroller: June 28 32,667 214,794 35,587 17,704 23,823 18,682 20,806 16,174 14,267 18,105 16,117 ! 11, 046 439,802 July 5 ...... 33,347 214,913 37,003 18,036 24,301 18,920 21,200 16,955 14,427 18,543 16,389 11, 104 445 138 July 12 33,436 215,633 38,485 18,509 24,945 19,134 21.745 17,495 14,627 18,721 16,568 11, 203 450,501 July 19 34,249 220,581 38,855 18,948 25,183 19,762 22,469 18,124 14,761 19,023 16,830 11, 342 460,127 Chargeable to Federal Reserve agent: June 28 127,973 722,286 172,653 191,896 88,097 60,058 320,914 77,026 61,713 86,595 52,353 134,454 2,096,018 Julv 5 129,693 741,567 181,237 191.764 87,919 77,820 332,320 77,245 61,553 89,157 52,111 139 596 2 161 982 July 12 141 404 778,847 191,035 201,791 88,175 77,606 332,495 81,305 63,353 88 979 51,932 144 177 2 241 099 Julv 19 150,391 786,499 191,385 203,752 89,537 76,978 348,111 84,676 63,219 90,677 51,670 145,638 2,282,533 In hands of Federal Reserve agent: June 28 : 11,300 110,000 13,040 22,000 7,705 2,025 44,460 5,900 5,255 7,020 18,490 247,195 Julv 5 7,700 105,200 13,040 12,700 6,485 19,075 47,100 4,160 3,955 7,320 18,095 244,830 July 12 17,000 119,000 22,320 20,000 6,545 18,775 35,780 8,800 4,555 6,620 17,975 ::::::::' 277,370 Julv 19 23,800 121,400 21,040 18,900 6,905 18,775 49,340 11,320 3,955 6,620 17,875 299,930 Issued to Federal Reserve Bank, less amount returned to Federal Reserve agent for redemption: June 28 116,673 612,286 159,613 169,896 80,392 58,033 276,454 71,126 56,458 79,575 33,863 134,454 1,848,823 Julv 5 121,993 636,367 168,197 179,064 81,434 58,745 285,220 73,085 57,598 81,837 34,016 139,596 1 917,152 July 12 124 404 659,847 168,715 181,791 81,630 58,831 296 715 72 505 58,798 82 359 33 957 144 177 1 963 729 July 19 126 591 665,099 170,345 184,852 82,632 58,203 298,771 73,356 59,264 84' 057 33,795 145'638 1 982 603 Collateral held as security for outstanding notes: Gold coin and e e r iiflcaies on hand— June2S.... 7,000 166,740 23,018 2,504 13,102 11,581 223,945 July 5 6,000 166,740 15,017 2,504 .... 13,102 11,581 214,944 Julv 12.... 1,000 163,740 11,518 2,503 13.102 11,581 203,444 Julv 19 163 740 7 017 2,504 13 102 11,581 197,444 In gold red e m p t i o n fund- June 2S 5,848 14,055 7,946 8,898 787 2,628 530 1,984 1,410 2,319 1,880 7,119 404,55 Julv 5 6,553 13,938 8,906 9,507 750 2,390 323 1,964 1,250 2,291 1,880 7,061 56,873 July 12.... 6,464 16,542 S,90o 9,093 615 2,177 240 1,968 1,250 2,291 1,870 6,962 58,378 July 19....! 7,151 16,542 8,779 9,655 615 1,548 378 1,922 1,116 2,228 1,845 8,823 60,602 ment fund. Federal Reserve Board: June 28 49,500 85,000 85,107 85,000 31,500 28,070 181,749 37,020 ! 11,500 31,360 584 82,131 708,521 July 5 49,500 100,000 86,731 95,000 32,500 24,570 153,722 24,160 11,500 31,360 584 80,631 690,258 July 12....1 49.500 100,000 90,249 95,000 32,500 25,570 152,300 29,631 9,500 31,360 584 85,131 701,325 July 19.... 49', 500 100,000| 91,999 90,000 ! 32.500 26,820 139,219 29,631 9,500 31,360 584 80,631 681,744 Eligible paper (minimum required).1 ! June 28.... 54,325 346,491 66,560 ! 52,980 48,105 24,831 94,175 32,122 30,446 ' 45,896 19,818 45,204 860,953 Julv 5 ! 59,910 355,689 72,560 ! 59,480 48,184 29,281 131.175 46,961 : 31,746: 48.186! 19,971 51,904 955,077 Julv 12....! 67,440 379,565 , 69,560j 66, ISO 48,515 28,581 144;175 40,906 j 34,946 i 48,708! 19,922 52,084 1,000,582 July 19.... 69.940 384,817 69,567 ! 78.180! 39.517 27.331 159,174 41,803 ! 35,546 50, '169 19,785 56,184 1,042,313 1 For actual amounts see item "Paper delivered to Federal Reserve agents" on p. 78"). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 787 Amounts of Federal Reserve notes received from and returned to other Federal Reserve Banks for redemption or credit during the period Jan. 1 to June SO, 1918. Boston. New York. Philadelphia. Cleveland. Received. Returned. Received, i Returned. Received. Returned. , Received. Returned. Boston §9,610,100 i S6,278,750 §820,000 $710,400 ; 8563,600 1125,600 New York , 86,318,400 88,728,100 12,120,890 16,513,750 !; 5,741,450 3,606,400 Philadelphia.. 818,000 730,300 18,501,000 i 10,571,750 2,405,000 1,498,750 Cleveland 115,870 573,240 3,749,900 ! 5,690,850 1,694,750 2,244,000 ;. Richmond . 272,750 442,000 3,540,650 6,941,450 1,515,250 1,522,250 ! 1,718,600 435,450 Atlanta 275,300 188,200 3,382,300 5,018,700 477,780 466,100 i 1,164,550 92,500 Chicago 478,000 697,210 5,351,000 5,542.700 906,000 1,028,000 I 2,336,000 1,036,300 St. Louis 180,815 128,900 1,793,595 1,246,600 294,720 226,500 ; 122,050 Minneapolis... 20,500 139,000 237,500 1,221,850 71.500 177,000 ! 60,500 121,550 Kansas City... 29,000 178,100 332,950 1,404,300 79', 150 207,250 : 92,350 115,600 Dallas 295,250 71,000 1,644,700 990033,,2200 263,900 123,650 I 787,900 56,500 San Francisco. 93,095 145, 700 584,895 2,8377,,3300 132,640 195,260 i 180,900 50,500 Total. 12,021,750 48,728,590 | 47,657,450 18,376,580 23,414.160 1 15,933,030 7,261,200 ) Richmond. Atlanta. Chicago. St. Louis. Received. | Returned. ; Received. I Returned. \ Received. ' Returned. I Received, j Returned. $442,000 S287,750 S183,200 $280,500 §697,200 I 8478,000 i 8125,100 8197,085 New Yorfc 6,929,300 4,511,100 4,964,050 3,412,200 5,698,050 ! 4,968,000 ! 1,228,350 I 1,796,030 Philadelphia.., 1,484,000 1,770,000 ; 458,000 466,800 1,204,000 i 710,000 j 215,000 306,420 Cleveland 397,950 1,729,600 ! 87,000 1,164,550 1,049,300 2,363,000 114,550 908,330 Richmond 658,750 1,486,950 1,167,350 434,000 91,000 310,590 Atlanta 1,486,950 666,000 1.248,850 864,000 1,161,300 1.849,240 Chicago 447,000 1,158,100 856,000 1,248,850 2,134,000 I 5;259,030 St. Louis 311,590 143,000 1,868,225 1,166,800 5,259.030 2,250,000 Minneapolis... 18,000 216,250 i 23,500 275,600 717; 500 3,613,000 67,500 532,495 Kansas City... 127,100 331,250 ! 93,800 581,850 421,700 3,632,000 412,150 2,930,525 Dallas .* 168,450 49,250 933,150 1,178,800 896,450 865,000 735,200 2,056,785 San Francisco. 237,160 48,250 86,205 129,850 1,031,350 1,747,100 120,410 326,500 Total. 12,049,500 10,910,550 10,211,880 11,392,750 j 19,390,780 21,924,100 1 6,404,560 16,473,030 ! Minneapolis. Kansas City. Dallas. San Francisco. Total. Received. I Returned.Received.! Returned. Received. | Returned.: Received.; Returned. Received. I Returned. Boston .! $139,000 i $20,500 $296,400 $37,815 $68,500 ; §320,650 $140,400 375,8601813,085,500 $8,812,910 New York .! 1,208,850 i 211,500 2,327,850 466,950 908,050 I1,395,900 2,794,150 688,150I 50,239,390 46,298,080 Philadelphia... .| 219,000 i 28,500 382,000 45,500 123,000 i 264,550 218,000 85,425 26,027,000 16,477,995 Cleveland .i 121,550 ! 60,500 177,840 101,500 47,000 i 800,400 73,500 156,210I 7,629,210 15,792,180 Richmond .! 233,250 j 18,000 348,990 49,090 50,000 i 168,450 27,750 229,785i 9,624,340 12,038,015 Atlanta .! 275,600 23,500 773,050 148,750 1,178,800 933,150 159,300 75,640; 11.583,780 10,325,780 Chicago .1 3,575,000 717,500 6,318,500 I 567,250 867,000 89G, 450 1,801,100 625,685I 25,069,600 18,777,075 St. Louis .| 532,495 63,500 5,228,525 j 646,050 2,056,785 735,200 314,950 100,295! 18,722,910 6,828,895 Minneapolis... 446,500 ! 332,050 41,000 142,150 398,000 286,835! 2,102,000 7,057,780 ICansas'City... 198,650 233,500 414,300 1,229,900 123,600 781,690 2,324,750 11,624,965 Dallas ." 142,150 41,000 1,924,220 i 725,250 227,950 196,035 8,019,320 6,266,470 San Francisco. 546,920 386,000 1,261,850 ; 179,700 217,245 235,450 4,492,670 6,281,610 Total j 7,192,465 1,804,000 19,485, 725 ; 3,299,905 5,971,680 7,122,250 j 6,278,700 3,301,610 !ITS, 920,470 i 166,581,755 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

788 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. MEMBER BANK CONDITION STATEMENT. Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close of s h business on Fridays from June 21 to July 12, 1918. 1. TOTAL FOR ALL REPORTING BANKS, 1 In thousands of dollars; i. e., 000 omitted.] I Boston. ! Y N o e r w k . ! j d P e h lp il h a i - a. C la le n v d e . - mond". ! Atlanta-! Chicago, 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. Number of report- j in^ banks: | June 21 i 72 36 ! 32 ' 703 Juno 28 ; 72 , 37 ! 32 ; 705 July 5 ; 101 j 71 ! 32 : 711 July 12 j 101 | 73 38 I 95 32 ; 49 712 United S t a. t e s : bonls to socare . circulation: I ! 11,621 51,729 12,970 43,528 24,389 ! 13,555 ; 19,256 17,867 ! 6,432 14,023 17,539 34,480 227,389 June 28 , 14,621 51,307 12,970 43,531 24,415 I 14,690 ! 18,758 17,417 i 8,419 14,023 17,376 35,355 270,380 July 5 i 14,621 52.080 12,970 43,542 24.733 I 14,690 ! 18,778 17,382 ! 6,419 14,086 17,579 36,126 273,004 July 12 ; 14,621 51; 981 12,970 43,531 24', 992 j 14,290 ! IS,776 17,417 | 6,319 14,023 17,629 35,714 272,283 O t h e'r United . States bonds, in- \ eluding Liberty bonds:' June 21 14,644 272,858 23,675 60,101 27,013 21,247 82,408 24,417 10,398 17,800 16,008 23.600 594,1i) June 28 13,515 268,435 23,026 60,741 26,049 21,602 80,577 22,897 ! 10,015 17,234 15,875 23.945 583,911 JulyS 12,883 257,484 22,502 58,088 25,617 21,372 77,351 23,577 9.769 17,509 15,859 22,065 564,056 July 12 13,026 260,420 21,803 54,541 25,678 20,268 75,867 21,959 9; 551 16,484 15,516 22,581 557,694 United States certificates of indebted ness: June 21 21,294 524,162 28,161 25,112 i 9,279j; 11,776 26,412 16,079 ! 9,16612,717 12,107 24,774 721,039 June 28 30,897 339,075 30,431 32,371 ! 10,982 ! 16,470 61.034 26,741 i 15.238 18,301 11,345 28,983 621,868 JulyS 28,439 I 325,327 30,817 31,160 ! 14.393 17,282 82,495 25,885 ! 15; 889 19,556 12,141 31,743 615,127 July 12 37,577 392,245 32,859 47,078 i 16', 158 17,711 82,929 26.861 j 18,036 21,897 11,169 31,014 735,534 Total" United , States securities j owned: ! June 21. ' 50,559 848,749 64,806 128,741 j 60,681 46,578 .128,076 58,363 j 25,996 44,540 45,654 82,854 ; 1,585,597 June 28 j 59,033 658,817 66,427 136,643 1 61,446 52,262 I 160,367 67,055 I 31,672 49,558 44,596 88,283 ' 1,446,159 JulyS i 55,943 634,871 66,289 132,790 64,743 53,344 i 158,622 86,844 j 32,077 51,151 45,579 89,934 ! 1,452,187 July 12 65,224 704,646 67,632 145,150 1 06,828 I 52,269 }177,572 66,237 33,908 52,404 44,314 89,309 1,565,491 Loans secured by United States j bonds and certificates: ! June 21 54,875 274,128 38,793 44,390 17,473 5,989 38,631 14,733 4,801 4,581 5,959 7,565 511,918 June 28 52,273 266,622 38,543 35,180 17,460 6,430 44,774 14,881 4,955 4,609 5,586 7,517 498,830 JulyS 52,346 250,141 39,383 32,332 17,281 6,783 48,036 14,958 5,135 4,625 5,562 7,483 484,337 July 12 48,219 247,025 38,936 31,025 17,772 6,289 53,552 14,731 4,962 4,744 5,948 8,827 185,030 Other loans an I investments: June 21 789,694 4,203,253 639,317 959,756 352,873 247,965 1,380,273 381,885 252,624 461,037 168,271 520,777 10,357,628 June 28 793,910 4,372,618 630,130 969,950 353,833 251,360 1,378,097 379,070 255,025 463,584 164,528 527,851 10,539,986 JulyS 784,842 4,418,765 819,972 974,493 349,894 263,380 1,397,018 379,552 255,258 467,593 162,570 525,991 10,599,330 July 12 772,198 4,397,422 600,349 972,861 341,363 252,825 1,385,545 377,694 252,761 466,945 165,063 521,333 10,506,359 Total loans and ! investments: June 21 895,128 5,326,130 742,916 ll, 132,887 431,030 300,432 1,546,980 454,981 283,421 510,158 219,884 611,196 12,455,143 June 28 905,216 5,298,087 735,100 1,141,773 432,739 310,052 1,584,238 461,006 291,652 517,751 214,710 623,651 12,515,975 JulyS 893,131 5,301,077 725,644 1,139,615 431,918 323,507 1,603,676 461,346 292,470 523,369 213,711 623,388 12,535,852 July 12 885,641 5,349,093 706,917 1,152,036 425,963 311,383 1,816,869 458,662 291,629 524,093 215,325 619,469 12,556,680 Reserve with Federal Reserve Banks: Juno 21 i 63,537 | 603,507 57,659 84,297 26,. 232 22,936 i 137,446 ! 30,818 17,489 41,887 16,766 46,794 1,149,368 June 28 ! 57,382 ! 734,284 53,300 78,041 !26,082 21,805 I 133,454 ; 32,662 17,701 38,995 15,926 44,632 1,254,060 July 5 ! 61,931 j 572,881 46,863 81.117 !25,561 23,947 131,216 ! 30,501 17,590 34,777 14,794 43,180 1,084,358 July 12 | 82,258 I 614,333 53,131 ; 77,035 ; 27,448 23,611 j 133,205 : 31,842 j 17,745 40,726 14,574 46,660 1,142,588 Cash in vault: i June21 ! 26,291 122,982 20,174 • 34,549 !15,459 12,242 I 58,011 ! 13,706 ! 8,043 34,787 j 10,550 19,847 377,041 June 28 \ 24,051 123,067 19,841 ! 29,835 |15,430 13,193 ! 80,086 I 13,040 7,745 15,537! 10,982 19,449 352,256 JulyS i 24,291 122,373 20,284 I 32,591 i 16,510 14,640 i 58,8L3 13,945 ! 8,306 15,481 11,614 19,855 358,703 July 12 ! 27,790 129,853 20,149 •• 32,793 16,820 13,873 81,209 I 11,291 7,899 16,355 11,284 22,085 371,401 Net demand deposits on which reserve is computed: June 21 647,820 4,324,393 557,695 ! 706,130 ! 259,473 170,395 1,010,485 j 257,482 169,011 353,731 145,561 365,852 8,968,028 June 28 637,994 4,301,438 564,865 , 874,020 ! 253,320 173,934 995,251 ! 242,640 167,209 350,601 138,251 378,507 9,117,565 July 5 650,478 ,4 ,1,9 8,,962 567,514 ' 686,526 ! 254,751 174,124 990,720 i 250,232 168,994 348,633 135,928 374,662 8,801,522 July 12 662,208 '4,337,625 568,486 i 704,049 ! 262,868 183,201 1,009,771 I 250,718 165,884 358,409 137,065 399,652 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 789 Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close of business on Fridays from June 21 to July 12, 1918—Continued. 1. TOTAL FOR ALL REPORTING BANKS—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 . - IAtlanta. Chicago. Lo S u t. is. M ap i o n l n is e . - I i K C a i n ty sa . s Pallas. I I F S r a a n n- Total. ! Cisco. Time deposits: " " " June 21 93,963 262,617 13,820 228,439 44,957 i 93,921 ! 345,911 j 74,465 i 45,512 I 60,799 23,625 111,422 ! 1,379,481 June 28 93,920 266,442 14,427 226,614 43,915 ! 77,138 ! 355,666 83,019 | 45,(543 I 62,447 22,764 112,502 i 1,404,497 July 5 96,630 264,656 14,337 n22o?7 ,A4C9\2n 1 A42rt, o8n0"7? iI 0802 ,o3n9/.3; i! o3n51 ,-77i0\C9t 74,581 ! 44,882 i 64,254 25,699 112,604 1,402,047 July 12 97,992 266,144 15,765 229,547 45,810 i 77,277 ! 358,275 74 497 i 44,650 ! 61,820 25,901 112,337 1,410,015 Total net deposits on which reserve is computed: June 21 684,814 4,391,452 562", 593 776,829 .' 274,801193,919 11,105,7r8800 276,878 ; 185,445 I 371,971 : 153.259 399,278 9,377,019 June 28 674,965 |4,370,257 569,948 744,190 ! 268,329 j198,841 1,092,7799(16 264,010 I 183,6S2 i 369,335 145;699 412.25S I 9,294,310 July 5 688,271 4.267,341 ; 572,607 756,986 I 269,365 i 200,398 ;087,164 269,669 184,209 i 367,909 144,410 ! 408,443 ! 9,216,772 July 12 700,457 4', 406,366 ! 574,031 775,953 : 278,670 \ 208,139 1,108,189 270,126 182,032 | 376,955 145,616 • 487^79r> ! 9,464,330 Government do- j posits: ; June 21 i 119,415 373,310 ! 77,920 87,567 22.614 i 3,828 93.460 : 37.791 I24,294 26,599 6,732 13,495 i 887,031 June 28 |129;787 592,608 j 76,313 120,795 ! 17,722 :28,657 149', 288 134;121 | 22,130 34.898 4,922 751 i 1,211,992 J J u u l l y y 5 1 2 ! ! 8 6 8 1 , , 6 04 0 4 2 4 44 4 4 5 , , 3 1 6 6 0 7 i ! 5 4 8 5 , , 0 3 4 8 4 8 6 8 8 6 , , 2 6 3 1 7 1 ! I 1 1 2 5 , , 9 2 7 7 9 0 2 1 0 6 , . 9 2 4 3 6 2 1 9 1 1 9 , , 6 7 5 6 0 8 | 1 2 2 7 9 , , 5 0 2 9 3 7 1 : 1 i7 8 , ,2 0 0 7 0 5 2 2 6 1 ; , 3 7 9 70 5 ; 9 6 i . 8 8 0 8 0 9 5 3 5 0 2 6 I ! 9 8 1 1 6 5, , 8 6 7 3 9 2 i 2. MEMBER BANKS IN CENTRAL RESERVE CITIES. CENTRAL RESERVE | CITIES. ! ! N umber of re port- j ing banks: ! ! June 21 j. 66 : 40 I ill: 120 June 28 ;. 66 40 : 120 Julyo !- 68 40 : 122 July 12 ;. 68 40 • 14 i. 122 United" States j 14 !. bonds to secure j cir J c u u n l e a t 2 io 1 n . : . ! 37,403 1,409 ; 10,392 : ! \ j 49,324 Jime2S 37,463 11 ,4A6t 9If I! 1 101,A3 '9i2nn ' : ! 4i9n. 3n24ni July 5 37,736 1,469 I 10.392 49,597 July 12 37.638 1,169 I 10,392 ;. :i49,499 Other U n i t c d States bonds, including Liberty bonds: June 21 245,259 51,503 .16;883 ! ! i 313,645 June 28 241,696 49.780 • 16,477 i : = : ; 307,903 July 5 229,923 481319 :16,380 ; 291,622 July 12 234,243 46'. 232 :15,575 : i 296,050 United. States certificates of indebtedness: June 21 515,351 9,938 13,911 i ! I 539,200 June 28 324,436 32,885 22,391 ! i i 379,712 JulyS 310,075 32,705 21,323 ! ! j 301,103 July 12 377,208 45,390 20,790 ! • ! I 443,388 Tot al United States securities owned: June 21 798,073 62,910 41,186 ; : : ; 902,169 June 28 603,595 84,084 49,260 •• ; I 736,939 July 5 1 577,734 82,493 •18,095 ; I 708,322 July 12 ! 649,089 93.091 46,757 ; : I ! 788,937 Loans secured by 1 United States j bonds and cer- j tifieatcs: i June 21 246,780 25.082 12,150 : i j 284,012 June 28 241,434 31', 835 11,989 i ! ! 285 258 July 5 225,637 33;388 11,988 I : ! ! 271,013 July 12 i 223.181 38,909 11.949 j '• : : 274,039 Other loans and • investments: : June 21 13.862,659 839,783 I 276,211 ! i i 4.978 053 June 28 4; 029,203 837,310 i 274,415 ! I ; ! • o, 14(K958 July 5 : 4,069,496 858,457 I 274,263 ; : : : 5'.202 216 July 12 i 4,041,478 845.896 ! 274,445 ! i 5'161 819 Total loans and I investments: • June 21 ! 14.907,512 927,775 ! 329,547 ! > : 6,164,834 June 28 ! 14,874,232 953^259 ! 335,664 : • '• i 0,163,155 July 5 ! 14', 872,807 974,338 i 334,346 \ i i.. . ! 6 181 551 July 12 : 14,913.748 977,896 I 333; 151 I ! 1 0,224,795 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

790 FEDERAL RESERVE BULLETIN. AUGUST 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 from June 21 to July 12, 1918—Continued. 2. MEMBER BANKS IN CENTRAL RESERVE CITIES—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 - . Atlanta. 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 S ra a n n - Total. cisco. CENTRAL RESERVE CITIES—continued. Reserve with Federal Reserve Banks: 575,512 97,380 23,157 696,049 E^Unnp 2<S 709,143 • 93,315 24,675 827,133 547,212 i 93,115 22,382 662,709 *" Julv 12 590,612 ! 92,858 24,868 708,338 Cash in"vault: 107 238 34.613 7,301 149,152 TrniP 28 105,895 35; 096 7,080 1 148,071 July 5 108,447 34,690 7,164 i 150,301 Julv I9 114,798 i 35,764 5,170 155,732 Net demand deposits on which reserve is computed: June 21 4,025,807 691,773 184,724 4,902,304 Tnnp 28 • 4,006,659 676,344 172,495 4,855,498 JulyS 3,898,195 667,506 177,808 4,743,509 July 12 4,038,568 676,076 181,472 4,896,116 Time deposits: Tnnp 21 217,859 130,208 53,415 401,482 Trmp 28 ' 217,466 140,038 62,040 419,544 Julv 5 216 069 138,828 53,194 408,091 July 12 216,711 138,820 53,181 408,712 Total net deposits on which reserve is computed: 4 076 082 721,821 197,051 4,994,954 4,056.843 708,660 186,812 4,952,315 Tiilv *S 3,948,057 699,543 190,084 4,837,684 July 12 :::::::: 4, OSS,578 708,111 193,745 4,990,434 Government deposits: Trnip 21 347.590 58,048 31,687 437,325 r«2. 854 1 113,034 26.743 692,631 Tnlv ri 413 9S9 ! 88,308 ! 21'804 524,101 TnlV 12 419;927 65,015 23,119 508,061 3. MEMBER BANKS IN OTHER RESERVE CITIES. OTHER RESERVE CITIES. Number of reporting banks: June 21 36 29 33 48 424 June 28 33 49 425 JulyS 34 49 428 July 12 34 49 427 United States bonds to securo circulation: June 21 4,498 7,796 8,965 35,810 13,994 11,105 17,037 5,780 3,440 14,023 15,086 34,480 172,020 June 28 4,498 7,796 8,965 35,816 13,994 11,360 i 16,537 5,330 3,440 14,023 14,923 35,355 172,037 JulyS 4,498 7,796 ; 8,965 35,827 14,230 12,360 16,557 5,330 3,440 14,086 15,126 36,126 174,341 July 12 4,498 7,796 8.965 35,816 14,378 11,360 16,557 5,330 3,440 14,023 15,176 35,714 173,053 Other United States bonds, including Liberty bonds: June 21 8,784 12,991 19,399 55,806 16,991 19,029 i 29,289 5,196 7,986 17,800 13,674 23,600 230,545 June 28 8,045 12,410 18,560 56,444 15,984 18,962 I 29,246 4,743 7,588 17,234 13,566 23,945 226,727 JulyS 7,483 12,007 18,178 54,009 15,703 19,258 27,482 4,561 7.507 17,509 13,780 22,065 219,542 July 12 7,674 12,021 17,562 49,916 16,071 17,765 I 28,074 3.999 7; 394 16,484 13,466 22,581 213,007 United States certificates of indebtedness: Juno 21 16,643 4,241 24,931 22,827 ; 8,069 10,323 16,45-1 1,658 7,847 j 12,717 11,088 24,774 161,572 June 28 23,870 6,848 26,138 29,451 •" 9,11813,932 27,704 3,054 11,410 ! 18,301 10,118 28,983 208.927 JulyS 20,591 6,533 26,014 28; 328 : 11,880 15,482 29,344 3,166 12,021 i 19,556 10,802 31,743 215;460 July 12 27.265 7,047 27,107 42,549 ! 13,328 lo.123 36,787 4; 220 13,079 i 21,897 10,150 31,014 249,566 Total United States securities owned: June 21 29,925 25,028 53,295 114,449 39,054 40,457 62,780 12,634 19,273 44,540 39,848 82,854 564,137 Juno 28 36,413 27,054 53,663 121,711 39,096 44,254 73'. 487 13,127 22,438 49,558 38,607 88,283 607;691 JulyS 22,572 26,336 53,157 118,164 41.813 47,100 ! 73,383 13,057 22,968 I 51,151 39,708 89,934 609,343 July 12 39,437 2ii,S64 53,634 128,281 43;777 44; 248 J.81,418 13,549 23,913 I 52,404 38,792 89,309 635,626 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 791 Prineipal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close of business on Fridays from June 21 to July 12, 1918—Continued. 3. MEMBER BANKS IN OTHER RESERVE CITIES—Continued. [In thousands of dollars; i. c, 000 omitted.] San 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 - . Atlanta. Chicago. Lo S u t. is. M ap i o n l n is e . - K C a i n ty sa . s Dallas. F ci r s a c n o - . Total, OTHER RESERVE CITIES—continued. Loans secured by United States bonds and certificates: June 21 44,988 14,090 36,780 43,459 14,568 5,608 12,885 2,091 4,623 4,581 5,660 7,565 196,898 June 28 43,198 13,602 36,459 34,255 14,974 5,737 12,289 2,105 4,729 4,609 5,270 7,517 184,744 July 5 43,674 12,522 37,440 31,510 14,982 6,258 13,992 2,355 4,916 4,625 5,274 7,463 185,811 July 12 39,546 11,625 36,906 33,209 15,128 5,579 14,011 2,264 4,777 4,744 5,658 8,827 182,274 Other loans and investments: June 21 561,091 144,137 569,831 886,201 249,410 222,141 529,143 83,779 190,085 461,037 142,403 520,777 4,559,835 June 28 565,259 146,069 560,783 906,252 249,115 218,965 529,238 82,464 189,366 463,584 138,820 527,851 4,577,756 Jn'y 5 557 627 144,622 550,983 900,209 246,078 237,025 527,324 83,569 190,113 467,593 137,044 525,991 4,568,178 JuJvl2 546,128 144,103 531,531 890,034 244,068 218,589 528,441 81,885 189,128 466,945 139,258 521,333 4,501,443 Total loans and inv J e li s n t e m 2 e 1 nts: 636,004 183,255 659,706 1,044,109 303,032 268,206 604,808 98,504 213,981 510,158 187,911 611,196 5,320,870 June 28 644,870 186,725 650,905 1,062,218 303.185 268,956 616,014 97,696 216,533 517,751 182,697 623,651 5,371,201 July 5 633,873 183,480 641,580 1,019,883 3021873 290,383 614,699 98,981 217,997 523,369 182,026 623,388 5,362,532 July 12 625.Ill 182,592 622,071 1,051,524 302,973 268,416 623,870 97,698 217,818 524,093 183,708 619,469 5,319,343 Reserve with Federal Reserve Banks: June 21 50,006 14,537 52,237 78,846 20,372 21,468 39,285 6,412 13,347 41,887 14,937 46,794 400,128 June 28 44,129 13,844 47,948 72.801 20,134 19,991 39,341 6,792 13,791 38,995 14,036 44,632 376,434 July 5 48,576 13,175 42,131 75,506 20,059 22,415 37,320 6,801 13,548 34,777 13,144 43,180 370,632 July 12 49,172 11,703 48,016 71,198 21,193 21,513 39,557 5,814 13,851 40,726 12,683 46,660 382,086 Cash in vault: June 21 17,642 5,193 16,414 30,143 11,224 11,005 22,964 5,013 4,781 34,787 9,766 19,847 188,779 June 28 16,261 5,282 16,604 26,080 11,026 11,573 24,585 4,742 4,709 15,537 9,768 19,449 165,616 July 5 16,226 5,116 16,749 27,943 12,357 13,581 23,652 5,435 4,930 15,481 10,201 19,855 171,526 Ju.lv 12 18,859 5,816 16,395 28,316 12,347 12,143 25,055 4,617 5,012 16,355 10,054 22,085 177,054 Net demand deposits on which reserve is computed: June 21 498,281 124,834 490,681 545,264 189,037 154,257 309,937 57,499 123,532 353,731 126,152 365,852 3,439,057 June 28 486,408 125,505 495,869 610,751 184,256 154,389 310,320 55,320 122,074 350,601 118,369 378,507 3,392,369 July 5 494,597 123,572 498,326 622,733 184,061 158,340 314,546 57,445 122,909 348,633 116,429 374,662 3,416,253 July 12 504,407 123,950 499,867 636,307 189,992 159,807 325,129 56,190 120,279 358,409 117,996 389,652 3,481,985 Time deposits: June 21 25,485 18,653 7,972 211,581 30,642 63,442 211,536 15,192 23,985 60,799 18,871 111,422 799,580 June 28 25,519 18,316 8,557 209,601 29,643 63,400 211,421 15,071 24,025 62,447 17,951 112,502 798,453 Julv 5 28,140 17.931 8,180 210,288 29,027 70,304 208,649 15,590 23,481 64,254 19,694 112,604 80S,142 July 12 29,152 19,091 9,418 205,909 29,799 63,627 215,201 15,560 23,237 61,820 19,830 112,337 804,981 Total net deposits on which reserve is computed: June 21 505,927 130.430 493,073 708,738 198,230 173,290 373,398 62,057 130,728 371,971 131,813 399,278 3,678,933 June 28 494,064 131J000 498,436 673,631 193,149 173,409 373,746 59,841 129,282 369,335 123,754 412,258 3,631,905 July 5... 503,039 128,951 500,780 685,820 192,769 179,431 377,140 62,122 129,953 367,909 122,337 408,443 3,658,694 July 12 513,153 129,677 502,692 698,080 198,932 178,895 389,689 60,85S 127,250 376,955 123,945 437,796 3,737,922 Government doposits: June 21 96,898 8,5S8 70,382 86,411 16,133 2,666 35,335 5,046 21,843 26,599 6,488 13,495 389,884 June 28 109,279 16,320 69,760 119,546 12,173 26,554 36,200 5,933 18,416 34,898 4,597 751 454,427 July 5 73,432 12,423 52,434 85,468 11,106 18,804 31,123 4,575 14,620 26,395 9,195 306 339, S81 July 12 48,465 8,990 41,603 66,476 10,735 14,726 26,387 4,442 12,620 21,776 6,341 552 263,113 4. MEMBER. BANKS OUTSIDE RESERVE CITIES. COUNTRY BANKS. j ! Number of report- | ; . ing banks: j j June 21 i 23 i 25 5 6 8 159 June 28 ; 23 ! 25 5 6 8 160 July5 • 23! 26 5 6 8 161 July 12 23 i 26 31 5 6 8 163 United States bonds to secure circulation: June 21 ! 10,123; 6,470 4,005 7,712 10,395 2,450 750 1,695 2,992 2,453 49,045 i Juno28 10,123 i 6,048 4,005 7,715 10,421 2,830 750 1,695 2,979 2,453 49,019 July 5 10,123 1 6,548 4,005 7,715 10,503 2,330 750 1,660 2,979 2,453 49,066 July 12 10,123 ! 6,547 4,005 7,715 10,614 2,930 750 1,695 2,879 2,453 49,711 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

792 FEDERAL RESERVE BULLETIN. AUGUST 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 from June 21 to July 12, 1918—Continued. 4. MEMBER BANKS OUTSIDE RESERVE CITIES—Continued. [In thousands of dollars: i. e., 000 omitted.] I I S. Atlanta.) Chicago. Minne- | Kansas Dallas. F S ra an n- To'.al. apolis. j City. cisco. COUNTRY BANKS— j continued. Other United States bonds, including Liberty bonds: June 21 5,860 14.608 4,276 4.295 j 10,022 2.218 ! 1,616 ! 2,338 ! 2,412 2,334 40.979 June 28 5,470 i 14J329 ! 4,466 4,2\>7 • 10,065 2.640 : 1,601 1,677 i 2,427 2,309 49; 281 July 5 5,400 15,534 ! 4.324 4,079 i 9.91-1 2:114 ! 1,550 j 2,636 -1 2,262 2,079 49,892 July 12 5,352 14,156 4,241 4,625 i 9,607 2.503 : 1,561 2; 385 •• 2,157 2,050 48,637 United States certificates of indebtedness: June 21 4,651 4,570 ! 3,230 2,285 ' 1,210 1,453 • 20 • 510 • 1,319 1,019 j. 20,267 June 28 7,027 7,791 . 4,293 2,920 i 1,864 2,538 . 445 . 1,296 : 3',828 1,227 !. 33,229 July 5 7,848 8,719 i 4, 803 2,832 ; 2,513 l)800 ! 446 ! 1,396 i 3,80S 1,339 j. 35, 564 July 12 10.3.12 7,990 . 5. 752 4,529 ! 2,830 2}588 : 752 " 1,851 ; 4,957 1,019 i. 42,580 Total United States securities owned: June 21 20,634 . 25,648 : 11.511 14,292 21,627 8,121 i 2,386 • 4,543 : 6,723 5,80fi 119,291 June 28 22,620 ! 28,168 I 1.2,764 14,932 22, Sc,0 8,008 2,796 4,068 ' 234 5,989 j 131,529 Julyo 23,371 : 30.801 : 13,132 14,626 22,930 244 : 2,746 i 5,692: Q,109 5,871 : 134,522 July 12 25,787 ; 28; 693 I 13,998 \ 16.809 23,051 j s!021 , 3063 5,931 ' 993 5.522 ! 140,928 Loans secured by United States bonds and certificates: June 21 9,887 13,258 i 2,013 : 931 : 2,905 ! 381 ! 664 . 492 • 178 299 ! 31,008 June 28 9,075 11,586 . 2,084 | 925 : 2,486 ." 693 , 650 : 787 226 316 i 28,828 July 5 8,072 . 12,282 ! 1,*M3 ' 822 2,299 i 525 j 656 : 607 2l\i 28'. 313 July 12 8,673 : 12,219 2;030 ! 816 ! 2.644 7.10 632 : 518 185 200 : 28.717 Other loans and investments: ! June 21 228,603 . 196,457 i 69,686 73,555 103,466 i 25,724 11,347 21,895 ' 62.539 25,868 i 819,140 June 28 228,651 . 1157,376 : 69.347 63,698 i 104,718 : 32,395 11,519 j 22,191 , 65,059 25,708 821,262 Julys 227,217 i204,647 , 68'. 989 74; 284 '• 103', 81C) i 26,355 11,237 21,720 ; 65,1-15 25.526 ; 828.936 July 12 226,070 : 211,841 68,818 82,827 ! 97,295 : 34,236 11.208 21,304 . 03; (533 25,805 j 843)097 Total "loans and investments: June 21 259,124 : 235.363 i 83,210 ! 88,778 i 127,998 I 32,226 14,397 : 26,930 : 69,440 31,973 969,439 June 28 260^346 = 237,130 : 84.195 ! 79,555 i 129,554 : 41,096 14,965 27.646 75.119 . 32.013 : 981,619 July 5 259;25S ! 247,730 ! 84,054 i 89,732 ! 125), 045 ! 33.124 14.R39 28)019 ; 74', -473 31.; 685 i 991,769 July 12 2(50.530 . 252,753 : 84,816 ! 100'. 512 j 122.990 ! 12'. 907 li:903 ! 27,813 73; 811 31,617 i 1,012,742 Reservev-ith Federal Reserve Bank: June 21 13,531 . 13,458 5,422 j 5,451 ! 5, S60 ; 1,468 781 • 1,249 4,142 1,829 ;. 53.191 June 28 13,253 j 11,297 i 5,352 5,240 I 5,948 | 1,614 1 798 : 1,195 , 3,910 1.890 |. 50,' 497 .Inly 5 13.355 ; 12,494 : 4,732 I 5,611 ! 5,502 ! 1,532 l 781 i 1,318 ! 4,042 j 1,650 |. 51,017 July 12 13^080 : 12,018 ! 5,115 j 5,837 ; 6,255 j 2,098 790 • 1,160 3,894 1.891 j. 52,144 Cash in vault: i June 21 8,649 10,551 3,760 4,406 4,235 1,237 '= 434 ! 1,302 3,262 1,184 ! 39,110 June 28 7, 790 j 11,890 3,237 3,755 4,404 1,620 405 : 1,2! 8 3.036 1,214 38,569 July 5 8,065 ! 8,810 ; 3,535 4,648 4,153 1,059 471 1,346 3,'YIQ 1,413 36,876 July 12 8,931 ! 9,239 3,754 4,477 4,473 1,730 390 1,504 i 2)S87 1,230 38,615 Net demand deposits on which reserve is computed: June21 ! 149,539 173, 52 014 I 806 i 70,436 j 16,138 8,775 15,259 '•4o, 479 19,409 626,667 J J u u n ly e 5 28 I 1 1 5 5 5 1 , , 8 5 7 8 9 6 1 1 6 7 9 7 ; , 2 1 7 9 4 5 • I 188 I 269 i 7 6 0 9 , , 6 0 9 6 0 4 ! 1 1 9 5 , , 5 7 1 8 5 4 8 8 , , 5 6 8 6 7 8 1 1 4 4, , 9 8 7 2 9 5 •.4 4 5 5 , , 1 0 3 8 5 5 - I , 1 1 9 9, , 4 8 9 8 9 2 I 6 6 3 4 0 0 , , 1 7 G 60 2 July 12 157,801 175,107 i 619 j 72,876 ! 23,394 8,566 13,056 . 45,605 19,069 651,835 Time deposits: i .7 line 21 I 68,478 . 26,105 s-is! 14,315 10,479 4,167 5,858 ! 21,557 : 4,754 i 178,419 June 28 I 68,401 i 30;660 . 14,272 13,738 4,207 5,908 i 21,618 i 4,813 186,500 July 5 j 68,490 j 30,656 I 870; 13,780 12,092 4,235 5,797 j 21,401 ! 0,005 185,814 July 12 I 68,8-10 ; 30,342 : 157 16.011 13,650 4,254 5,756 ! 21,4-13 : 6,071 196,322 Total net deposits i ; 347 ! on which reserve is computed: June 21 ; 178,887 i 184,940 69,520 68,091 ! 76,571 i 20,629 10,561 • 17,770 I 54,717 : 21,446 i 703,132 June 28 ! 180,901 ! 182,414 ! 71,512 70,5M) 75, ISO 25,432 10,390 i 17,357 j 54,400 ; 21,9-15 : 710,090 July 5 | 185,232 i 190,333 • 71,827 71,166 ! 76,596 20,967 10,481 i 17,463 ! 54,256 22,073 i 720.394 July 12 1 187,304 ! 188,111 i 71,339 77,873 I 79,738 29,244 10,389 : 15,523 j 54,782 21,671 : 735,974 Government deposits: June 21 22,517 ! 17,132 7,538 j 1,156 ! 6,481 i 1,162 ! 83 ! 1,0,18 i 2,451 I 214 o9,822 June 28 20,508 ! 23,434 ! 6,553 ! 1,249 i 5,549 i 2,103 j 54 ; 1,445 i 3,714 ! 325 64,934 July 5 15,170 i 18,755 i 5.610 ! 1,143 i 4,164; 2,142 337 i 1,144 \ 3.580 605 52,650 July 12 12,579 . 15,443 ; 3)785 1/761 ! 2,244 i 1,506 1 248 ! 1,536 i 5^55 . 548 44,705 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 793 EARNINGS ON INVESTMENTS OF FEDERAL RESERVE BANKS. Average amount of earning assets held by each Federal Reserve Bank during June, 1918, earnings from each class of earning assets, and annual rates of earnings on basis of June, 1918, returns. Average balances for the month of the several classes of earning assets. Federal Reserve Bank. co B u i n ll t s e d d is fo - r | 1 Bills bought United Municipal m F e e m de b r e a r l s R a e n - d | | i m n a o r p k e e n t, sec S u ta ri t t e i s es. warrants. Total. serve Banks. Boston S46,791,731 $21,406.303 32,194,715 870,392,749 New York. 395,550,465 !12o!629j' 642 30,196,127 551,376. 234 C Ph le i v la el d a e n l d phia... 5 5 1 1 , , 9 7 0 6 2 0 , , 3 6 4 2 8 4 ! I 2 1 0 2 i , 6 24 8 9 0 . , 5 3 7 3 1 8 it:0 7 5 3 6 2 ; . 6 8 0 5 0 0 8 7 0 7 , , 0 3 6 1 6 5, . 5 7 3 9 6 5 C S M R A K S D a h t i t a a i . n c l i n l n c a h l L n s a a F n m e o a s g t r s a u a o a o p i n C n s o c d i l i t i s y v s c . o ::::::::::::::::l 1 3 4 5 3 2 3 5 0 9 0 9 8 8 3 1 0 . , . , , , , , 5 7 0 2 1 7 7 1 5 0 7 3 1 8 0 ( 7 5 0 3 9 3 6 3 ' 0 . . , , , , , , 9 4 0 0 2 3 2 5 1 0 3 6 8 1 0 9 3 1 4 7 2 0 0 2 I . ! i ' ! I k 4, 4 4 2 0 7 1 1 1 2 7 4 8 9 7 5 9 2 0 7 0 3 8 7 1 : , , , , , . i 1 2 1 0 6 3 8 6 7 0 9 0 3 2 3 2 6 7 9 0 3 0 2 9 1 12 0 2 2 3 5 1 ; , , , . , 9 0 5 4 7 7 7 2 4 3 7 6 8 4 2 5 0 3 5 3 2 4 1 3 , , , , ' , . , 7 8 5 6 4 0 4 7 8 4 1 4 0 0 1 0 3 6 7 5 0 0 7 0 2 3 1 4 2 0 , , 7 9 3 0 0 3 1 3 3 8 5 7 5 6 3 7 5 4 8 7 2 3 4 ' ' , , , , . , . 6 8 3 6 9 8 7 6 9 7 5 7 7 0 6 0 0 4 6 4 8 6 3 2 , , , , , , , , 0 2 2 7 6 6 8 2 0 9 9 2 9 0 9 8 0 5 3 9 1 9 6 3 Total 938^441,967 : 238,506,910 97,695,600 253,633 ! 1.274,898,110 Earnings from— Calculated annual rates of earnings from— Bills dis- Bills dis- I I Feder B al a n R k e . serve co m F u e e n a m d t n e e b d d r e a r f l s or m i b n o B a u o r il k g p l e s h en t t . se U c S u n ta r i i t t t e e i s d es. M wa u r n r i a c n ip ts a . l ; Total. c m o F u e e n a m d n te e d b d r e a r l l s or m i b n o B a u o r i k l g p l e h e s t n t . se U c S u n ta r i i t t t e e i s d es. M wa u r n r i a c n ip ts a . l Total. Reserve Reserve Banks. Banks. I Per cent. Per cent, j Per cent. Per cent. Per cent. Boston 31 63.108 ! S77. 225 I So,802 $246, 4.24 4.39 ! 3.21 3.95 New York 1,338; 432 i 434.702 ! 68,864 1,84L 4.11 4.20 : 2.77 4.06 Philadelphia ' 1S2,914 I 70; 973 13.377 267, 4.28 4.17 3.43 4.20 Cleveland ISO, 185 ! 42. 620 • 52! 347 281, 4.38 4.23 3.96 4.27 Richmond 192,976 | 17,420 : 7,433 217, 4.56 5.02 3.28 4.59 Atlanta 13,921 4. S43 $159 115, 4.31 4. IS 3.14 4.90 4.20 Chicago 368 JM4 81,744 24,063 473. 4.40 4.30 2.90 4.2S •St. Louis ICJS'.So-i 17.278 • 5,856 191, 4.26 4.40 2.59 4.19 Minneapolis 129; 007 5:293 ; 8,896 143; 4.66 4.45 2.91 4.48 .Kansas "City 235,913 r,(H)7! 25,68-1 263. 4.81 4.16 2.49 4.41 Dallas. 112.522 4,067 ' 11,355 709 128, 4.45 4.27 2.52 4.05 4.16 San Francisco. 153!553 6:>. 938 12.036 232, 4.72 4.24 2. 73 4.42 Total I 3,328,048 i 833,788 240,556 4,403.260 I 4.31 4.25 3.00 4.19 4.20 I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

794 FEDEKAL RESERVE BULLETIN. AUGUST 1,1918. GOLD IMPORTS AND EXPORTS. Gold imports and exports into and from the United States. [In thousands of dollars; i. e., 000 omitted.] Week Nine days i Ten days e J n un d e i n 2 g 1, - e J n u d n i e n g 3 — 0, ! ! e J n ul d y i n 10 g , - To J t 1 a a 9 n l 1 . 8 s 1 . in , ce J J a u T 1 n l 9 o y . 1 t 7 1 1 a . l 3 to , 1918. 1918. I 1918, Ore andgbase bullion ,. 224 324 226 6,409 8,139 United States Mint or assay office bars 33 Bullion refined 140 "152" 37,125 363,204 United*States coin 144 6,773 52,886 Foreign coin 142 94,307 Total. 13,605 j 418 | 50,449 i 518,569 EXPORTS. Domestic: Ore and base bullion 2 ! 56I 109 United States Mint or assay office bars 30 i 29 450! 25,102 Bullion refined 1 3 3,392 ! 14,914 Coin 464 729 18,140 I 174,917 Total. 215,042 Foreign: Bullion refined.. Coin Total Total exports. 220,361 Excess of gold imports over exports since Jan. 1,1918, $28,079; excess of gold imports over exports since Aug. 1,1914, 81,078,383. DISCOUNT RATES. Discount rates of each Federal Reserve Bank approved by the Federal Reserve Board up to July 81, 1918. Maturities. Discounts. Trade acceptances. Secured by f. S. certificates of indebtedness or Liberty loan Federal Reserve Bank. Within 15 Agricul- bonds. days, tural and i m n b c e a l m n u k d b s i e n 7 r g 1 d 6 a t y o s . 60 61 to 90 li o v p v e a - e p s r t e o 9 r c 0 k d W ay i s t h in in c lu 1 d 5 - in 1 c d l t a u o y s s i 6 v , 0 e. in 6 c 1 d l a u t y o s s iv 9 , 0 e. collateral days. ing member 16 to 90 notes. banks' days. collateral notes. Boston 4-1- New York i... 4 Philadelphia.. Cleveland Richmond Atlanta Chicago St. Louis Minneapolis... Kansas City... % Dallas San Francisco. i Rate of 3 to 4£ per cent for 1-day discounts ia connection with the loan operations of the Government. NOTE 1.—Acceptauces purchased in open market, minimum rate 4 per cent. NOTE 2 —Rates for commodity paper have been merged with those for commercial paper of corresponding maturities. NOTE 3.—In case the 60-day trade acceptance rate is higher than the 15-day discount rate, trade acceptances maturing within 15 days wiM be NOTE 4.—Whenever application is made by member banks for renewal of 15-day paper, the Federal Reserve Banks may charge a rate not exceeding that for 90-day paper of the same class. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 795 Estimated general stock of money, money held by the Treasury and by Federal Reserve system, and all other money in tht United States. July 1,1918. General stock U H n e it l e d d i n S t t a h t e es H F e e ld d e b r y a l o R r e fo - r H th e e ld U o n u i t t s e id d e c A ap m it o a u o n u t t p si e d r e o U f n m i o te n d e y S i t n a t t e h s e . G a T o s v r s e e e a t r s s n u o m r f y e t n h a t s e .! s a e n r d v e a g B e a n n t k s. s an R s d y e F s s t e e e d r m v e e . ral a e n ra d l t R he e s F er e v d e system. Gold coin2 $3,076,482,515 $245,602,753 §1,335,977,274 $458,392,424 !. Gold*certificates 503,490,770 533,019,294 i. Standard silver dollars 499,684,959 """38," 685," 508* 3 810,389 76,531,156! . Silver certificates 8,594,414 373,212,362 i. Subsidiary silver i 232,147, 14,940,804 217,206,560 I. Treasury notes of 1890 1,851,130! . United States notes 346,681,016 6,744,783 M7,972,800 I 291,963,433 Federal Reserve notes 1,847,580,445 29,982,400 106,089,275 ! 1,711,508,770 i. Federal Reserve bank notes 15,444,000 100,025 4,278,900 I 11,065,075 j. National-bank notes 724,205,485 20,068,477 11,148,003 ! 692,989,005 :. Total: July 1,1918 6,742,225,784 356,124,750 2,018,361,825 4,367,739,209 ! $41.31 June 1,1918 6,615,007,782 348,322,704 1,983,796,097 4,282,888,981 ! 40.51 May 1,1918 6,540,954,630 321,192,308 1,909,594,674 4,310,167,648 : 40.82 Aprll,H918 6,480,181,525 339,856,674 1,873,524,132 4,266,800,719 i 40.47 March,! 1918 6,351,548,056 330,927,176 1,827,126,208 4,193,494,672 i Februarys 1918 6,271,603,039 332,576,125 1,834,102,608 ! 4,104,924,306 : 39.04 January,! 1918 6,256,198,271 277,043,358 1,723,570,291 ! 4,255,584,622 : 40.53 December,! 1917 6,026,127,909 248,167,148 i,646,773,746 4,131,187,015 • 39.40 November,i 1917 5,823,854,335 242,265,377 ,546,124,691 4,035,464,267 i 38.54 October,! 1917 5,042,264,856 242,469,027 ,429,422,432 3,970,373,397 i 37.97 September,! 1917 5,553,661,151 239,654,267 373,987,061 3,940,019,826 ! 37.73 August,! 1917 5,513,292,894 248,268,325 ,395,982,728 3,869,041,841 37.10 July,i 1917. 5,480,009,884 253,671,614 ,280,880,714 3,945,457^556 i 37.88 i Includes reserve funds against issues of United States notes and Treasury notes of 1890 and redemption funds held against issues of national bank notes. Federal Reserve notes and Federal Reserve bank notes. 3 Includes balances in gold settlement fund standing to the credit of the Federal Reserve Banks and agents. 3 Includes subsidiary silver. 4 Includes Treasury notes of 1890. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

796 FEDERAL RESERVE BULLETIN. AUGUST 1,1918. ABSTRACT OF CONDITION OF MEMBER BANKS. Abstract of reports of condition of member State banks and trust companies in each Federal Reserve district on May 10, 1918. [In thousands of dollars; i. e., GOO omitted.) j Dis- Bis- ; Dis- Dis- Dis- • Dis- Dis- Dis- Dis- Dis- Dis- Dis- : Total • trict trict : trict trict trict : trict trict i trict trict trict trict trict i United ! No.l No. 2 ] No. 3 No. 4 No. 5 j No. 6 No. 7 ! No. 8 No. 9 No. 10 No. 11 No. 12 States ! (23 (63 , (16 (26 (20 i (30 (114 ! (23 (35 (16 (43 (40 (449 ' banks). banks), .banks). banks). banks).! banks). banks).; banks).j banks).banks.)banks),. banks), banks). T"— i- RESOURCES. j Loans and discounts 1306,249 il,414,329 i 91,782 [198,367 32,238 ! 93,846 |466,598 1142,705 I 30,53544,058 17,044 47,172 2,884,923 Overdrafts | 230 1,328 j 317 75 i 264 | 208 I 40 I 53 30 44 136 i 2,811 Customers7 liability account ofacceptances and under letters- | 86 • i of credit • 16,741 632 ! 2,168 ; 12,234 j 9,764 100 1,152 155,390 United States securities (exclu- j sive of United States securi- j 109,067 j 1,422 j 2,110 ties borrowed). ! 21,102 4,074 17,238 | 69,064 | 29,150 | 5,331 2,255 8,077 618,639 "War savings and thrift stamps actually owned j 59 411,170382 ; 13,2884 9i j 337,2831 24 146 437 14 27 31 33 ! Stock of Federal Reserve Bank. | 1,493 7,547 :1,574 ! 2,273 318 612 2,659 1,067 145 210 109 257 j 18,264 Other bonds, stocks, etc. (ex- i elusive of securities borrowed).; 75,688 442,360 ! 90,552.134,292 9,578 14,4171138,331 33,124 3,191 10,918 442 7,930 960,823 Banking house • 7,147 38,588 i 5,268 10,256 1,208 5,604 9,935 3,165 548 820 420 1,746 84,705 Other real estate owned : 116 5,166 i 1,579 3,947 564 2,489 1,035 644 141 129 96 1,109 17,015 Furniture and fixtures 203 354 i 264 554 88 287 1,307 574 190 j 78 219 254 4,372 Due from banks and bankers...: 38,002 161,292 , 13,200 23,950 5,940 23,330 61,254 18,703 5,068 j 10,345 2,965 8,233 372,282 Exchanges for clearinghouse, j also checks on banks in same | place ! 5,624 123,167 1,923 2,349 279 ; 4,938 I 12,969 3,715 401 437 152 156, 761 Outside checks and other cas h"j items ; 1,947 7,014 i 142 284 123 I 821 5,375 258 576 168 242 17,888 Cash in vault ; 13,797 45,495 ,4,637 6,384 1,543 I 4,705 24,662 4,711 1,221 1,652 831 2,586 112,224 Lawful reserve with Federal I Reserve Bank ! 34,075 276,967 15,106 19,786 2,673 | 8,059 49,658! 13,842 2,062 4,553 1,538 432,401 Items with Federal Reserve i Bank in process of collection. | 3,523 9,965 1,081 533 335 797 4,600 3,442 71 314 171 435 ! 25,267 Due from United States Treas- j urer ! 257 105 12 11 227 7 803 Interest earned but not col- : lected 795 I 10,187 612 203 4 101 80 57 33 1 7 46 i 12,126 Other assets I 1,536 j 34,444 3,485 727 18,200 260 109 202 95 ! 61,067 Total 528,584 |3,099,215 244,336 '442,848 60,405 180,700 878,542 1266,436 46,899 79,695 26,694 84,392 i 5,938,746 LIABILITIES. ! j I Capital stock paid in ! 23,800 107,319 14,900 21,860 6,296 | 12,010 48,880I 18,885 3,740 4,150 2,918 6,120 270,878 Surplus fund ; 25,977 144,159 37,554 54,063 4,437 i 8,478 40,966! 17,389 1,263 2,974 852 ! 2,492 340,604 Undivided profits, less expenses; and taxes paid | 7,077 31,681 4,946 ! 7,717 1,494 I 2,11612,884 4,431 | 629 507 1,271 75,641 Interest and discount collected, j but not earned : 593 4,399 10 312 43 | 123 136 ! 55 150 7 37 5,923 Amount reserved for taxes ac- j crued 1,164 5,412 393 678 76 ! 302 1,349 60 50 17 100 9,924 Amount reserved for interest , 323 ; accrued i 849 12,983 511 448 1,499 52 206 27 200 17,558 Due to Federal Reserve Bank...j 294 i 55 55 Due to banks and bankers ; 23,118 278,892 9,078 13,697 2,305 24,626 61,404 22,815 I 8,438 12,362 1,709 7,235 465,679 Demand deposits |300.831 1,771,822 136,250 134,854 28,267 71,638 316,628 100,906 i13,607 36,804 14,624 32,862 2,959,096 Time deposits ! 83^77 213,447I 18.071 173,205 13,555 36,814 335,820 60,721 ;16,841 18,898 3; 646 I 30,263 1,004,658 United States deposits I 41.525 245,278118,648 23,723 1,012 12,849 32,437 18,668 !1,516 2,713 I 1,748 i 1,926 402,043 Bills payable with Federal Re- j serve Bank i 500 140,177 172,079 Bills payable other than with j Federal Reserve Bank 225 2,265 11,232 Acceptances, letters of credit. ; and travelers' checks out- I standing i 17,384 Other liabilities : 2,161 Total ; 528,584 Liability for rediscounts, including those with Federal Reserve Bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 797 Abstract of reports of condition of member State banks and trust companies of the Federal Reserve system on May 10, 1918, arranged by classes. [In thousands of dollars; i. e., COO omitted.] Total Total : Central re- Other re- United '. serve city serve city States i banks i banks (250 banks), i (55 banks). (87 banks). Dec. 31, 1918. 1917. RESOURCES. Loans and discounts 1,655,955 827,303 401,665 2,884,923 2,418,063 Overdrafts 1,338 909 504 2,811 1,202 Customers' liability account of acceptances and under letters of credit 128,033 25,454 1,303 I 155,390 140,847 United States securities (exclusive of United States securities borrowed). 446,117 109,901 | 02,021 j 018,039 234,592 War-savings and thrift stamps actually owned 518 192 j 275 985 Stock of Federal Reserve Bank 9,280 0,409 i 2,5L5 18,264 14,810 Other bonds, stocks, etc. (exclusive of securities borrowed) 4f>2',980 319,585 ! 178,258 900,823 871,506 Banking house 38; 090 32,881 13,734 84,705 66,713 Other real estate owned 4,995 •9,748 2,272 17,015 13,486 Furniture and fixtures 738 : i;8.i8 1,810 4,372 2,912 Due from banks and bankers.. 189,304 i 124,324 58,054 372,282 324,569 Exchanges for clearing house, also checks on banks in same place. 133,083 i 20.001 3,017 150,701 241,963 Outside checks and other cash items 9,3.84 ! 5,017 3,487 17,888 22,721 Cash in vault. 55,500 ! 34,673 21,985 112,224 97,000 Lawful reserve with Federal Reserve Bank 307,982 : 90.095 34,324 432,401 1387,438 Items with Federal Reserve Bank in process of collection. 15,047 I 7,047 2,573 25,267 Due from United States Treasurer 240 | 351 212 803 1,071 Interest earned but not collected 9,43G I 949 1,741 12,120 Other assets 32,734 | 24,508 3,825 61,067 j '174,'332 Total. 3,502,020 1,641,285 794,841 j 5,938,746 I 5,013,885 LIABILITIES. Capital stock paid in 134,013 86,125 50, 740 270.878 219,294 Surplus fund 175,765 130,001 34,838 340', 604 301,471 Undivided profits, less expenses and taxes paid 36,454 24,555 14,632 75;641 48,483 Interest and discount collected but not earned 4,363 1.249 311 5,923 Amount reserved for taxes accrued 6,351 2,638 935 9,924 6,113 Amount reserved for interest accrued 12,842 2, 706 2,010 17,558 7,551 Due to Federal Reserve Bank 55 55 10 Due to banks and bankers 329,49G 109, 706 26.477 465,679 449,015 Demand deposits [, 934,702 689,961 334;433 2,959,096 2,746,899 Time deposits 292,259 441,361 271,038 1,004,658 858,460 United States deposits 274,160 91,977 35,906 402,043 135,014 Bills payable with Federal Reserve Bank 141,047 22,018 9,014 172,079 30,349 Bills payable other than with Federal Reserve Bank 5,952 5.280 11,232 18,375 Acceptances, letters of credit, and travelers' checks outstanding. 131,265 26.432 i;302 158,999 136,074 Other liabilities 29,903 6,604 7,870 44,377 56, 777 Total. 3,502,620 1,641,285 j 794,841 5,938,746 5,013,885 Liability for rediscounts, including those with Federal Reserve Bank 62,286 28,883 I 16.308 107.477 96,501 ziatio of reserve with Federal Reserve Banks to net deposit liability (per cent) 15.4 11.0 i '7.6 13.2 12.5 1 Includes items with Federal Reserve Bank in process of collection. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

798 FEDERAL BESERVE BULLETIN. AUGUST 1,1918. Abstract of reports of condition of all member banks in each Federal Reserve district on May 10,1918 {including 7,683 national banks and 449 State banks and trust companies). [In thousands of dollars, i. e., 000 omitted.] d N is o t . r i 1 ct D N is o t . ri 2 ct D N is o t . ri 3 ct D N is o t . ri 4 ct D N is o t . ri 5 ct D N is o t . ri 6 ct D N is o t . ri 7 ct D N i o s . tr i 8 ct D N is o t . ri 9 ct D N i o s . t r 1 ic 0 t D N is o. t ri 1 c 1 t D N i o s . tr 1 i 2 ct U T n o i t t a e l d ba ( n 41 k 4 s). ba ( n 68 k 4 s). ba ( n 6 k 45 s). ba ( n 7 k 72 s). (540 ba ( n 39 k 9 s). b ( a 1 n ,1 k 5 s 8 ). ba ( n 4 k 8 s 6 ). (814 ba ( n 9 k 71 s). ba ( n 66 k 6 s). ba ( n 5 k 83 s). S (8 t , a 1 t 3 e 2 s banks). RESOURCES. Loans and discounts ,000,482 3,796,796 743,5041,053,385 543,210 428,4491,738,904 507,449 10,811 731,567 399,897 667,64512,142,099 Overdrafts 593 2,031 617 855 866 940 2,605 621 984 1,202 14,465 Customers liability account of acceptances and under letters of credit 63,358 219,060 18,881 15,446 14,706 7,635 38,359 14,451 3,958 4,507 18,050 419,815 United States securities (exclusive of United States securities borrowed) 143,9151,329,761 203,756 265,532 136,035 127,979 318,927 137,197 86,615 149,470J 122,603 175,142 3,196,932 War-savings and thrift stamps actually owned. 277 501 436 747 350 391 718 932 324 75l| 643 353 6,423 Stock of Federal Reserve Bank 6,444 19,717 8,508 2,992 9,685 3,504 2,769 3,471 2,932 4,307 75,020 Other bonds, stocks, etc. (exclusive of securities borrowed).--; 219,756 967,704 371,900 397,208 84,162 46,605 302,517 82,614 53,511 :73,218| 12,286 116,901 2,728,382 Banking house 27,803 81,616 29,428 50,553 23,045 18,251 44,511 16,278 15,014 17,148! 15,374 22,907 361,928 Other real estate owned.. 1,090 10,750 5,095 9,481 2,808 5,765 6,194 2,648 3,804 4,139] 3,665 7,194 62,633 Furniture and fixtures... 1,535 3,042 3,051 3,463 2,509 2,531 5,519 2,2061 2,670 a 3,000 5,138 Due from banks and 'I Ex b c a h n a k n e g r e s s for clearing 132,652 332,426 109,359 175,594 81,982 97,317 298,942 101,909 V96,519 197,965 51 83,445 161,598 1,869,708 house, also checks on Ou b t a s n id k e s c in h e s c a k m s e a n p d la o c t e h . e . r .. 26,481 415,384 30,475 18,527 11,495 12,435 58,! 12,096 7,952 18,054| |J 5,450 18,326 635,634 cash items 4,810 18,639 2,588 3,486 2,237 3,886i 9,296 2,224 J 31,,079 4,157 ! 4,433 3,223 62,058 Cash in vault 46,089 151,960 42,250 ,24,451; 94,823 23,864""2"2,043 30,814 18,944 33,791 574,599 Lawful reserve with Federal Reserve Bank 95,349 97,817 114,087 46,044 40,250- 185,885 48,631 42,278 38,430 70,422 1, Items with Federal Re- j serve Bank in process ! of collection 13,924 46,77i; 26,764 20,858 15,312 8,226; 25,628 16,566 2,164 9,957| 6,378 5,170 197,718 Due from United States In T te r r e e a s s t u r e e a r rned but not 5,993 3,387 5,676 2,680 2,087| 5,579 2,306 1,' 2,756| 2,250 , 3'154 40,803 collected 1,115 16,991 1,050 1,772 365 200; 1,312 246 855 56o! 358 1 844 25,668 Other assets 2,480 48,729 3,874 855 1,116 22,331 323 207 163] 1,223 241 82,591 Total. 1,791,439 8,156,147 1,698,300 2,206,9411,000,140 831,506 3,170,694 877,285 1,319,509 726,8311,315,608 24,070,465 LIABILITIES. Capital stock paid in 116,756 303,186 91,524 144,274 77,356 61,628 197,237 74,748 61,646 77,462 63,917 97,326 1,367, §60 Surplus fund 98,753 351,720 139,816 139,958 • 50,672 38,408 127,061 43,168 32,053 40,053 34,860 46,799 1,143,321 Undivided profits, less expenses and taxes paid 45,458 133,202 33,419 44,453 19,033 14,191 51,532 16,928 12,773 20,214 17,552 22,700 431,455 Interest and discount collected but not earned... 1,317 14,435 1,395 2,798 1,700 796 4,716 948 1,274 1,971 1,110 737 33,197 Amount reserved for taxes accrued 3,608 13,421 1,221 1,955 657 678 4,242 953 1,116 1,504 1,000 31,042 Amount reserved for interest accrued 1,268 16,916 1,650 2,161 1,557 770 3,024 664 1,391 240 1,189 31,724 Due to Federal Reserve Bank 222 1,743 236 72 1,438 313 349 4 110 160 4,746 Due to banks and bankers 132,250 1,334,680 178,612 231,464 107,914 94,739 500,990 156,347 109,636 271,738 71,714 158,417 3,348,501 Demand deposits , 903,050 4,103,965 784,823 912,647 408,843 361,454 1,274,354385 861 325,510 607,032 162,777 620,294 11,050,610 Time deposits 207,806 537,066 256,198 472,920 185,603 141,605 705,658 144,647 250,862 176,298 54,690 213,475 3,346,828 United States deposits... 146,835 655,914 102,848 114,005 41,261 47,934 115,958 67,280 36,837 43,129 43,481 43,792 1,459; 274 Bills payable with Fed- Bi e ll r s a l p R ay es a e b r l v e e o B th a e n r k than 6,591 297,817 16,750 17,471 23,841 14,955 36,984 19,049 6,665 22,209 14,262 10,609 487,203 with Federal Reserve Ac B c a e n p k tances, letters of 4,116 10,259 2,873 ; 6,687 9,765 2,930 6,190 2,533 3,870 5,217 10,436 6,16*5 71,071 credit, and traveler's Na ch ti e o c n k a s l - o b u a t n s k ta n n d o i t n es g out-! 67,701 234,064 20,585 | 15,632 I 14,761 | 7,687 37,808 14,463 3,985 1,453 4,791 18,826 441,756 standing 50,374 88,969 55,605 I 90,876 51,699 j 39,969 79,525 41,526 28,910 46,738 43,896 i 61,844 679,931 Other liabilities 5,336 58,790 10,745 | 9;568 4,040 i 3,449 25,066 6,950 753 2,306 | 12,245 142,746 Total. 1,791,439 8,156,147 2,206,9411,000,140 |831,5063,170,694976,065 877,285 1,819,509 726,831 11,315,60824,070,465 Liability for rediscounts, including those with Federal Reserve Bank, 73,698 205,660 31,760 39,328 32,284 I 13,773 58,081 24,981 15,408 34,130 16,803 | 30,779 576,685 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1,1918. FEDERAL RESERVE BULLETIN. 799 Abstract of reports of condition of all member banks of the Federal Reserve system on May 10, 1918, arranged by classes {including 7,683 national banks and 449 State banks and trust companies). [In thousands of dollars, i. e., 000 omitted.] Total Uni- Total Uni- Central Other Country ted States ted States reserve reserve banks (8,132 (7,907 city banks city banks (7,558 banks), banks), (133 banks).(441 banks). .banks). May 10, Dec. 31, 1918. 1917. RESOURCES. Loans and discounts 4,112,233 3,678,491 4,351,375 12,142,099 11,806,512 Overdrafts 1,839 2;874 I 9,752 14,465 16,268 Customers' liability account of acceptances and under letters of credit 263,211 139,352 17,252 419,815 377,356 United States securities (exclusive of United States securities borrowed). 1,265,449 727,717 i 1,203,766 I 3,196,932 1,858,093 War savings and thrift stamps actually owned 800 1,092 ! 4,531 ; 6,423 Stock of Federal Reserve Bank 20,798 22,899 i 31,323 I 75,020 70,743 Other bonds, stocks, etc. (exclusive of securities borrowed) 787,226 757,327 !1,183,829 ! 2,728,382 2,783,621 Banking house 78,871 122,919 160,138 : 361,028 340,322 Other real estate owned 8,720 21,506 ' 32,407 ! 62,033 59,531 Furniture and fixtures 1,496 6,770 29,427 37,693 35,191 Due from banks and bankers 415,280 740,122 i 714,306 1,869,708 2,128,556 Exchanges for clearing house, also checks on banks in same place 460,801 142,110 ! 32,723 635,634 969,489 Outside checks and other cash items 19,278 20,531 : 22,249 : 62,058 82,296 Cash in vault 166,619 163,847 : 244,133 : 574,599 627,590 Lawful reserve with Federal Reserve Bank 752,363 416,209 . 367,724 i 1,536,296 11,656,300 Items with Federal Reserve Bank in process of collection 70,747 109,286 i 17,685 197, 718 Due from United States Treasurer 4,902 12,379 23,522 40,808 Interest earned but not collected 15,938 3,760 • 5,970 25,668 Other assets 50,843 25,835 ; 5,913 82,591 222,479 Total. 8,497,414 ' 7,115,026 8,458,025 24,070,465 23,078,045 LIABILITIES. Capital stock paid in 323,863 399,227 643,970 1,367,060 1,311,150 Surplus fund 368,772 366,665 407,884 1,143,321 1,085,110 Undivided profits, less expenses and taxes paid 125,451 110.807 195,197 431,455 371,533 Interost and discount collected but not earned 17,450 10,364 5,383 33,197 Amount reserved for taxes accrued 15,946 10,162 4,934 31,042 21,834 Amount reserved for interest accrued 15,477 6,863 9,384 31,724 17,431 Due to Federal Reserve Bank 1,166 1,450 2,130 4,746 3,190 Due to banks and bankers 1,691,125 1,306,841 350,535 3,348,501 3,639,507 Demand deposits 4,162,458 3,073,884 3,814,268 11,050,610 11,179,676 Time deposits 425,903 832,295 2,088,630 3,346,828 3,156,241 United States deposits 677,327 505,858 276,089 1,459,274 649,413 Bills payable with Federal Reserve Bank 294,698 113,558 78,947 487,203 229,598 Bills payable other than with Federal Reserve Bank 474 17,616 52,981 71,071 85,258 Acceptances, letters of credit, and travelers' checks outstanding. 277,193 146,665 17,898 441,756 390,900 National bank notes outstanding 51,140 177,692 451,099 679,931 673,728 Other liabilities 48,971 35,079 58,696 142,746 2 263,476 Total 8,497,414 • 7,115,026 8,458,025 I 24,070,465 23,078,045 Liability for rediscounts, including those with Federal Reserve Bank I 205,448 j 229,295 141,942 I 576,685 571,917 Ratio of reserve with Federal Reserve Bank to net deposit liability (per cent) 14.9 : 11.1 7.7 I 11.3 11.4 1 Includes items with Federal Reserve Banks in process of collection. 2 Includes §132,633 United States and other securities borrowed. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

800 FEDERAL RESERVE BULLETIN. AUGUST 1, 1918. Classification of loans and discounts of 449 State banks and trust companies, members of Federal Reserve system., as shown by their condition reports for May 10,1918. [In thousands of dollars; i. e., 000 omitted.] District District'' District District District District District: District! District District District1 District, Total No. 1 '' No. 2 ! No. 3 No. 4 No. 5 N"o . ( N~o . 7 No. 8 No. 9 No. 10 l No. 11 I No. 12 U. S. (23 : (03 ! (16 (2(5 ; (20 (30 (114 (23 (35 (10 (43 (40 (449 banks), j banks), jbanks). ibarcks). 'banks). banks).jbanks). jbanks). banks). banks), [banks), banks). banks). ! i I On demand not secured by collateral 21,366j 38,287 6,205-' 6,293; 1,204 3,950; 11,179; 10,271 1,258 2,757! 557; 4,031 107,358 On demand, secured by Liberty bonds and'United States Treas- On u r d y e m ce a rt n i d fi c s a e t c e u s r e o d f i b n y d o e t b h t e e r d n co e l s s. 2,7751 14,735 672. 1.147; 298 3131 4,488- 2;093| 33 103: 22! 333 27,012 lateral 711-; 408,760 56,436' 48.564: 7,343 25,979; 59,797! 32,751 1,483 3.216" 1,102! 2,518 698,666 On time,not secured by collateral. 6431 458,950 8,898 52] 213. 13,741 31,983! 182,059| 48,935 12,010 LV.979 5,259; 12,957 982.627 On time, secured by Liberty bonds and "United States Treasury certificates of indebtedness. ,4851 62,544 1,943; 6,751; 876 3,596! 14,078; 2,598 516 425 275| 335 104,420 On time, secured by other collateral ". ,567j 301,651 14,881 j 38041- 6,162 20,250; 101,824' 27,76 7,806 15,546; 6,492^ 4,074 591,057 Secured by real estate mortgages or other real estate liens or deeds ,621! 38,261 2,866! 44,851 j 3,607! 7,653! 93,497^ 18,040! 6,448 6,963; 1,981; 4,677! 255,465 Acceptances of other banks discounted ,718! 42,174| 101! 447;. 347- 223311 105! ; ! 6.' 7; 53,136 Acceptances of this bank purchased or discounted.. ". 20,474' 160; 95; 1,054; 272 : • ! 24,781 Loans bv foreign offices unclassi- i : ! : i fied * 34,186 34,186 Totals shown by reports ! 309,064;l, 420.028 92,002J 198,'467 33,326! 95,619: 468,207 142,826! 29,554; 44,989; 15,694; 28,932; 2,878,708 Net adjustments due to inclusion ' of rediscounts in loan classification by some banks and account failure by others to show anv loan classification: Net deduction 2,815! 5,6 220 100 1,088: 1,773! 1,609 121 . 931;. Net addition , 981: 1 1,350" l 18,210| 6,215 Total loans and discounts..; 306,2491,414,329 91,782! 198,3671 32,238; 93,8461466,598 142,705 30,535; 44,05S: 17,044; 47,172;2,884,923 1 Large adjustment necessary on account of failure of two banks with loans aggregating $18,079,000 to give loan classification. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. Page. Page. Abstract of reports of condition of member banks.. 796-800 Foreign exchange bank: Acceptances: Amendment to act creating 722-724 Banks granted authority to accept up to 100 per Testimony of Governor Harding regarding, cent of capital and surplus 742 before Banking and Currency Committee. 724-728 Gold imports and exports 794 Distribution of, statement showing 778 | Gold settlement fund, transactions through 772-773 USG of, in cotton financing 713-714 Grain financing, investigation of, by Federal Trade Amendments to Federal Reserve Act: Commission : 711-713 As ponding in conference committee of House Indexes of business conditions 697-699 and Senate 714-718 | | Informal rulings of the Board: Creating a foreign exchange bank 722-724 I Eligibility of note of nonmember bank used in Business conditions: trading in Government obligations 743 Indexes of 697-699 Rediscount of notes used for draining and tilling Reports on, by Federal Reserve agents 746-765 farm land 743 Capital Issues Committee, report of, to Federal Indorsement of acceptances 744 Reserve Board 704-708 Authority to act as guardian 744 Charters issued to national banks during the month. 740 Basis for figuring interest for direct transactions- 744 Charts: Law department: Movement of deposits and reserves of Federal Indorsement "without recourse'? 745 Reserve Banks since January 4, 1918 770 Bills payable with attorney's fees or collection Movement of earning assets of Federal Reserve charges 745 Banks since January 4, 1918 771 Liberty bonds, list of, lost or stolen 739 Check clearing and collection system, operation of.. 774 ! Member banks: Commercial failures reported 741 Abstract of reports oi condition of 796-800 Cotton financing, use of acceptances in 713 Statement showing condition of 788-792 Credits, cur! ailment of nonessential 685-687 Money, stock of, in the United States 795 Resolutions of Federal Reserve-Bank of New National Association of Cotton Manufacturers, committee of, appointed to consider use of acceptances York regarding 741 | in cotton financing .. 713-714 Department of Agriculture, article furnished by, on 9 ; National banks: relation of farm credit statement to short-time ; Charters issued to, during the month 740 credit for farmers 718-722 | Fiduciary powers granted to, during the month. 742 Discount operations of the Federal Reserve Banks. 775-781 | Philippine National Bank Act, text of. 728-734 Discount rates in effect 794 Resources and liabilities of Federal Reserve Earning a-^ets, deposits, and reserves of Federal Banks 782-784 Reserve Banks, movement of 768-771 Review of the month: Earnings and expenses of Federal Re&erve Banks for Treasury certificates of indebtedness 688 6-month period 700-704 Conservation of resources 688 Earnings on investments of Federal Reserve Banks. 793 Conference with governors 689 Farmer, relation of farm credit statement to short- Rediscounts and acceptances 690 term bank credit for 718-722 Interest rates 690 Federal Reserve Act: Cotton financing < - - 691 Amendment to, creating a foreign exchange War finance loans to fanners 691 bank 722-724 Operations of the Federal Reserve Banks 092 Text of amendments as pending in conference Condition of member banks ." 693 committee of Rouse and Senate 714-718 Gold exports and foreign exchange 694 Federal Reserve agents' fund, transactions through. 773 Concentration of gold 694 Federal Reserve Banks: Progress with branches 695 Foreign branches 695 Earnings and expenses of, for 6-month period. 703-704 Growth in number of State bank members 696 Earnings on investments of, for month 793 Amendments to the Act 696 Resources and liabilities of 782-784 Work of the Capital Issues Committee 696 Federal Reserve note account of Federal Reserve Departure of Mr. F. A. Delano 097 Banks and agents 785-786 State banking associations, council of 708-711 Federal Reserve notes, interdistrict movement of.. 787 State banks and trust companies: Federal Trade Commission, investigation by, re- Comparative membership statement, January lating to financing of grain 711-713 and July, 1918 *. 735 Fiduciary powers granted to national banks. 742 List of, admitted to system during the month. 734 Foreign branches of American banks 735-739 Treasury certificates, issue of 699 i o Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis