Federal Reserve Bulletin, 1918-10

FEDERAL RESERVE BULLETIN ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON OCTOBER, 1918 WASHINGTON GOVERNMENT FEINTING OFFICE 1913 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BOARD. W. P. G. HARDING, Governor. EX OFFICIO MEMBERS. , Vice Governor. WILLIAM G. MCADOO, ADOLPH 0. MILLER. Secretary of the Treasury, Chairman. CHARLES S. HAMLIN. JOHN SKELTON WILLIAMS, Comptroller of the Currency, J. A. BRODERICK, Secretary. M. C. ELLIOTT, Counsel. L. G. ADELSON, 1 H. PARKER WILLIS, Assistant Secretaries. W. T. CHAPMAN, J Director, Division of Analysis and Research. W. M. IMLAY, Fiscal Agent. F.I. KENT, M. JACOBSON, Statistician. Director, Division of Foreign Exchange. n Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUBSCRIPTION PRICE OF BULLETIN. The Federa! 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 2.0 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. ±'age. Review of the month 921 Conservation of productive power and credit 931 The fourth Liberty loan ... 937 Dollar exchange 938 Meal tickets of drafted men en route to camp received for collection 938 Establishment of an acceptance corporation 939 Issuance of British treasury bills in the United States 940 Statement of Hon. R. C. Leffingwell relative to foreign-exchange situation 940 Foreign business of the National City Bank of New York 942 Text of amendments to the Federal Reserve Act 947 Circular on cattle-loan agencies issued by the War Finance Corporation 950 Election of directors of Federal Reserve Banks under the new amendments 950 New issues of Treasury certificates of indebtedness 951 Condition of the savings institutions in the United States 952 British bank amalgamations 954 Status of bank clerks under the draft law 957 The fourth Liberty bond act 961 Report of the committee of five of the American Bankers' Association on clearing and collection of checks 962 Membership of State banks and trust companies 964 State banks and trust companies admitted to the system during the month 966 Fiduciary powers granted to national banks 967 Charters issued to national banks 967 Banks granted authority to accept up to 100 per cent of capital and surplus 967 Commercial failures reported 967 Lost and recovered Liberty bonds 968 Informal rulings of the Board 971 Rulings of the Division of Foreign Exchange 973 Law Department 974 Business conditions throughout the Federal Reserve districts 979 Comparative statement of leading banks of issue, 1914 and 1918 996 Reserves, circulation, and security holdings of the Bank of England, Bank of France, and German Reiclisbank. 998 Charts showing 999 Reports of total bank transactions 1002 Index of wholesale prices 1005 Discount and interest rates 1016 Gold settlement fund 1019 Operation of the Federal Reserve clearing system 1021 Discount operations of the Federal Reserve Banks 1022 Resources and liabilities of the Federal Reserve Banks L030 Federal Reserve note account of Federal Reserve Banks and agents 1033 Member bank condition statement 1035 Earnings on investments of Federal Reserve Banks 1040 Gold and silver imports and exports 1041 Estimated stock of money in the United States 1042 Discount rates in effect 1043 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN VOL. 4 OCTOBER 1, 1918. No. 10 REVIEW OF THE MONTH. Four and one-half per cent Treasury certificates of indebtedness issued in anticipation of fourth Liberty loan—Con. Since the last number of the FEDERAL REc .. fi f f SERVE BULLETIN two issues of Aug. 6. ; Sept. 3. Sept. 17. Indebtedness8. certificates of indebtedness (the fifth and sixth of the present T B r o e s a to su n r .' y 4 4 9 , , 5 5 0 8 9 1 5 3 7 , , 4 0 2 0 4 0 i ; 5 3 4 , , 0 7 0 1 0 0 series) have been placed and the results of the N Ph e i w la Y de o l r p k h ia 2 3 07 8 , , 2 4 8 0 7 0 2 4 1 2 0 , , 0 0 6 6 1 8 .5 i ; 2 4 1 5 6 , , 7 2 7 6 8 4.5 sale announced. In each case there was an Cleveland 52,500 74,088 ! 59,321.5 Richmond 14,397 18,957 : 18,449 oversubscription. The amount of the fifth Atlanta 14,968.5 16,205.5 15,872 Chicago 87,292.5 88.279 88,878.5 offering was $500,000,000, and the oversub- St. Louis 24,066 25j 501.5 24,178.5 Minneapolis j 12,260 17,200 17,700 scription was $139,493,000. The sixth issue, Kansas Citv i 25,126 25,913 22,816 Dallas ' ! 7,5 79.5 11,295.5 11,898.5 fixed at $600,000,000, was oversubscribed by San Francisco | 37,750 49,500 46,350 $25,216,500. Experience with the successive Total ! 575,706.5 : 639,493 | 625,216.5 issues shows that the banks throughout the Payable | Dec. 5 < Jan. 2 \ Jan. 16 country are steadily adapting themselves to the requirements of the Government and are The fact that there are now outstanding endeavoring to withdraw their resources, as $4,018,751,000 of certificates of indebtedness they find it practicable, from unessential which constitute a prior claim upon the proloans, placing them at the service of the ceeds of the fourth Liberty loan shows in a Treasury. Elsewhere in this issue there are striking way the necessity for an early and genpublished figures showing the holdings of cer- eral sale of the new bond issue. Such an issue tificates of indebtedness by member banks, is provided in the fourth Liberty loan whose holdings of Liberty bonds, and loans made by terms were announced by the Secretary of the the [member banks upon certificates or bonds Treasury on September 24. The intention is to as collateral securities. These figures furnish place an issue of $6,000,000,000 of bonds, bearfresh evidence of the extent to which the ing 4£ per cent as in the last preceding issue and banks are supporting the burden of the Govsold under substantially similar terms except in ernment's financial program. In the followso far as relates to exemption from taxation—a ing [table are given combined figures showing matter more fully explained at a later point in by districts the total of the certificates offered this issue. The banks of the country have come in all six of the issues which have thus far been actively to the support of the Government placed, oversubscriptions having been received in largely making advances for the purpose in each issue. of paying for the commodities and services Four and one-half per cent Treasury certificates of indebtednessneeded in the conduct of the war. The mainissued in anticipation of fourth Liberty loan. tenance of our financial soundness now requires (In thousands of dollars.) that these obligations shall be promptly funded into long-term bonds taken and held by bona June 25. July 9. July 23. fide investors as generally as possible, in order Treasury 11,938 35,653 : 4,327 Boston ! 64,590 56,273.5 ! 48,267.5 that all parts of the country may bear their New York ! 312,844.5 273,219.5 ! 211.714 Philadelphia.. 53,000 53,100 ; 36; 872.5 share in supporting the war. Cleveland 80,000 66,550 i 55,927 Richmond 19,013 15,073.5 "j 16,886 The fourth Liberty loan campaign, which Atlanta 17,233.5 16,021.5 ! 13,168.5 Chicago 131,481.5 101,203 j 83,310.5 opened on. September 28, will St. Louis 34,654 31,260.5 25,952.5 Minneapolis... 20,000 22,100 I 16,800 contiime UP to October 19. Kansas City... 28,410.5 30,031.5 23,369 Dallas 18,481.5 14,452 10,156 While the amount of bonds San Francisco. 48,_000_ 39,000_ 38,000 now offered to the public is set at 86,000,000,000 Total.... ~839~ 646.5 753,938 584,750.5 Payable Oct. 24 Nov. 7 Nov. 21 for the current issue as a minimum, it should be 921 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

922 FEDERAL RESERVE BULLETIN. OCTOBKR 1, 1018. borne in mind that the program originally an - [power along those lines which are fundamental nounced by the Secretary of the Treasury in- jto the war must be scientifically and effectually volved the placing of at least $10,000,000,000 icarried forward according to a skillfully preadditional for the fiscal year ending June 31, arranged program. 1919. That amount would have been neces- Thus far it has been sought to effect such sary in order to obtain the entire $24,000,000,- | a readjustment of industry by " Order out of . , •, * i \ 000 called for by the program of expenditure j , „ fnoillowing txhe plan ol voluntary laid before Congress at the time when the war I rationing with such aid as could revenue bill was presented to the Ways and •!be given by financial control and curtailment Means Committee of the House of Represonta-1of banking credit. The inadequacy of voluntives recently. The deficiency appropriation j tary methods in the face of our rising national plans have now raised the required total to per- requirements has, however, necessitated rehaps $30,000,000,000. While there are some course to more direct and authoritative conestimates which indicate that the new revenue trol in order, to use the language of the War bill may yield $9,000,000,000 rather than Industries Board in its statement elsewhere $8,000,000,000 of income from taxation, the printed in full in this BULLETIN, to " bring sums expected from loans under the original order out of chaos." program thus seem to be in all probability far Such a program of control is now in process within the limits of Government requirements of development at the hands of the War Indusfor the current fiscal year, and the fourth Lib- tries Board, the various Government bodies erty loan must be regarded as only a beginning engaged in the reorganization of labor, and the in the great financial program whose success is Provost Marshal General's office, which has essential to the carrying out of our military issued instructions with reference to the appliplan. cation of the "man power bill." In order to encourage and facilitate a wider The program of the War Industries Board distribution of the fourth Liberty loan, in dis- is based upon a comprehensive tricts which feel the need of such support the Rationing m" application of the principle of dustry. Federal Reserve Board, on September 30, ap- "priority." The system of proved a new preferential rate of discount in priorities thus far announced, with reference favor of customers' notes of 16-90 days7 matur- to the apportionment of fuel, material, labor, ity, secured by fourth Liberty loan bonds, fix- and transportation among different entering the rate at 4 per cent. This rate, however, prises, constitutes an effective beginning of a was conditioned upon the extension to the cus- system for the rationing of industry. The tomers in whose favor the discount was orig- President, in his message of April 2,, 1917, it inally made of a rate not greater than the will be recalled, had forecast what is now coupon rate of 4J- per cent, so that those banks being done, saying at that time, with referwhich act as intermediaries in placing the ence to our war program: "It will involve paper with Federal Reserve Banks may enjoy the organization and mobilization of all the a margin on such paper not greater than one- material resources of the country to supply fourth of 1 per cent. the materials of war and serve the incidental It is clear that success in obtaining this needs of the Nation in the most abundant great sum of money must be conditioned upon and yet the most economical and efficient way the most careful adaptation of resources to possible." requirements. Not only must the utmost The attainment of the object now aimed at by economy be practiced by the individual, but these Government bo dies has long been regarded the reorganization of industry upon a basis as essential by the Federal Reserve Board, which which will eliminate every unessential element has from time to time announced either officially and will concentrate the Nation7 s productive or through its members the necessity of a care- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBBtt 1, 1918. FEDERAL RESERVE BULLETIN. 923 fill adaptation of business to war requirements. to have the first claim on the productive power In an address before the American Academy of the country; less essential industries will of Political and Social Science in November, be limited by what is left. The consumer will 1917, Mr. A. C. Miller, member of the Federal be practically rationed by being kept from the Reserve Board, called attention to the require- full use of his spending power, and his savings ments of the case in the following language: will therefore be made available for the purchase of Government bonds. Sound finance will require that the limits of taxation The voluntary system of rationing or conshould be extended as borrowing reaches the point of trolling credit was, moreover, lacking in uniinflation. Hardly less clear to my mind, and certainly not less cogent, is the inference that finance alone will not formity since it was based upon the assumpachieve the needed results: consumption will have to be tion that practically all individuals must rely controlled and production will have to be directed on upon the banks for accommodation. Such is some adequate basis in order that any plan of finance we not the case, inasmuch as there are many busimay adopt shall be certainly equal to the task of providing nesses of an unessential type whose receipts the Government with the vast masses of goods and services consist chiefly of cash and which accordingly it will require for the war. * * * The financial problem at best is only partly a financial or money problem— pay in cash. These enterprises are selfa problem of getting the wherewithal to buy and pay. financing and hence do not find themselves Chiefly it is a problem of getting the goods and services obliged to rely upon the banks, thus leaving to buy. * * * In sum, we must, as a nation, produce an inevitable gap in what otherwise might be more and consume less. This, in its simplest terms, must a uniform system of oversight. Within the be our national formula of finance. We must produce past year or two, moreover, the general prosmore of the things which the nation at war requires and, perity of many classes, due to the payment of in order to set free the nation's productive forces to accomplish this result, we must consume less of the things which very high wages and the consequent practice the nation in war time does not require, even though it of paying cash for goods, has resulted in enhas been our national habit in peace time to consume such abling many concerns which formerly had to things in unstinted measure. rely in part upon bank loans to finance them- So far as lay within its power the Federal selves, to do without such advances, so that it Reserve Board has attempted to pave the is probably true to-day that the number of way for adequate industrial organization by concerns which are not subject to banking urging a program which it has designated as control is very much greater than at any time conservation and curtailment of credit. The in the past. For these and other reasons any problem, however, is so broad and far-reach- effort at rationing based upon regulation of the ing in its connections that it has always been supply of credit was certain to be more or less obvious that control of credit could not alone unsuccessful, even if conscientiously and carebe relied upon to produce the necessary re- fully carried out. A much more drastic and sults. In substance, the new plan amounts to fundamental method was needed to exert the the regulation of supply of goods for the general requisite control over the direction to be taken consumption by determining conditions under by business under existing conditions. which their manufacture may proceed. This The bearing of this situation on the outlook is a much more direct and effective and power- for the Federal Reserve system is very evident. ful means of control than any that could have For some time past—indeed, since the opening been exerted through the withholding of credit of the war—the question of controlling the from unessential or unnecessary enterprises. expansion of banking credit has been of fore- Thus is (1) the production of those things most importance. The new departures in adneeded for the war to be stimulated and facil- ministration, to which reference is made, simitated, and (2) the consumption of those plify the banking aspects of this question and things which the community in war time does at length render possible the adoption of a not need for its health, efficiency, and happi- wisely conceived system or plan of control of ness to be restricted. Necessarv industries are credit expansion. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

924 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. In effect the policy of rationing industry will eral Reserve system and the strength and Controlling ex- operate to control expansion of soundness of our whole banking situation, also pansion at the credit and thus avoid what are conserves credit and thus reduces the likelihood source. usually described as the evils of of expansion of banking credit running an uninflation. As has been explained on former oc-- controlled course. casions, what is ordinarily called "inflation7' is ill though the plan of rationing both labor and an increase in|the means of exchanging goods, materials thus affords a needed whether through the use of currency or of °f contro1 of the general scope of bank credit in excess of or out of proportion business, it remains true that the to the quantity of goods thus to be passed from function of banking credit, in determining the one part of the community to another. As the direction of business within the area marked situation was stated in the FEDERAL RESERVE off for it, is still of basic importance. No BULLETIN for June last: broad and general plan of fundamental control "Whenever the volume of current pur- can be expected to operate automatically with chasing power in terms of money, whether in such immediate and complete success as to the form of actual currency or in the form of dispense entirely with the cooperation of credit, grows or is increased faster than the the auxiliary agencies afforded through the volume of available goods, the resulting situ- supervision of credit by bankers. Credit, like ation may be ascribed to the excess of cur- everything else of value, is limited in supply rency or credit, or both, above normal require- and inadequate to meet all requirements that are ments, or, more briefly, to the distension of brought to bear upon it. It must therefore be currency and credit. This alteration of the carefully protected in amount and fully safeproportion between existing goods and pur- guarded for the uses for which it is considered chasing power eventually results in increasing most important. The fact that a control of busiprices, not necessarily in the exact degree in ness has been established through another means which the volume of purchasing power has thus in no sense reduces the need for a wise use been increased, but in the degree in which it of credit from the banker's own standpoint. is actively used to effect purchases and the Steady demand on the part of the Government transfer of goods." for more and more funds to meet its require- The existence of large quantities of goods ments may be expected to continue, and the produced by industries which of necessity have use of bank funds to carry current Government to make demands upon the banks of the coun- requirements can not be kept upon a safe and try for the credit needed to maintain them im- sound basis unless it is possible to bring about plies a continuous effort to obtain from bank- a corresponding diminution of the accommoers a favorable decision on the question whether dations extended by banks in other directions. the maintenance of such businesses is or is not They can not, in a word, enlarge their supessential. This question is always difficult to port of the Government and at the same answer in any definite way, but the difficulty time go on lending as heavily as before to of giving such an answer is much increased individuals and corporations if their aggregate when the plant and goods whose future is to of loanable funds remains only the same as be settled by the banker's decision are already was previously the case. They must, therefore, in existence. The policy which is much more choose from the business offered to them likely to be effective is that of determining that which is likely to be most serviceable what goods shall and what goods shall not come in the maintenance of national requirements, into existence. This operates not only to the and which at the same time will be most end designed by the War Industries Board— likely to keep their own lending power up that of conserving men, fuel, transportation, to high level without absorbing it in the makand materials—but, as already indicated, and ing of nonliquid or long-period advances. The what is of most immediate concern to the Fed- time has, however, arrived when the banker Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1, 1018. FEDERAL RESERVE BULLETIN. 925 can consider this question of conservation ofnecessary to render possible a subscription to credit primarily from the banking standpoint the new securities by no means meets the subrather than from that of the national economic stantial requirements of the case. interest over which he has perforce been obliged While the wide distribution of Government to stand guard during the past months in which Loans on Gov- bonds obtained during the a consistent and adequate policy concerning ernment securi- course of the third Liberty loan the elimination of unnecessary business waswies' was highly satisfactory, and still awaiting development at the hands ofj while the amounts of Government obligations governmental agencies set up for the specific |actually subscribed for by the banks were compurpose of shaping the needed plan of con- |paratively small, investigation shows that in trol. ' |many cases private individuals who had sub- What has been said once more emphasizes scribed to bonds have not liquidated their obthe necessity of obtaining not ligations as promptly as is necessary but are Absorbing the j } technical but the ac- I still carrying them at banks which from time ory t le bonds. *. _ . . . i i i' to time renew the notes of their customers coltual absorption oi tne bonas j lateraled by these securities. The compilaof the fourth Liberty loan and of achieving this ! tion of data relating to the condition of savend through the self-denying process of saving, j ings banks which has been prepared by the The action taken by the War Industries Board I savings banks section of the American Bankers and by the draft authorities renders it easier to Association and is printed in this issue of the save in that the number of objects to which ex- FEDERAL RESERVE BULLETIN shows that cuspenditure can be devoted is less than before. tomers of savings banks are still in many cases Nevertheless, the essential duty of providing new in debt to these institutions in considerable wealth from which to supply the requirements amount. This is a situation which in the of the Government and thereby to enable the natural course of events would tend to bewide and genuine distribution of the now bonds come more rather than less pronounced as is greater than ever before. This necessity is more Government loans are placed on the doubly emphasized by the fact that the fourth market. In effect it implies that the banks Liberty loan and those which will necessarily are actually carrying a considerable part of the succeed it have assumed such great dimensions, bonds pending the time when the subscribers making it evident that the utmost use must be themselves pay for their securities out of saved made of the resources of the country in order income. The necessity of greater saving in to bring about a genuine sale of the new bonds. order to render possible the definite absorption More than ever before investors are called upon of the bonds by private holders has thus become not only to place their subscriptions but to incontestable, since it is only in that way that look forward to the early settlement of these new buying power can be applied in the pursubscriptions out of the proceeds of their own chase of the securities. Nor does mere converefforts, to the end that the banks may be resion of other investments into funds which are lieved of the certificates of indebtedness they used to reduce the debt of individuals to the are now carrying, and may have their funds banks contracted for the purpose of buying left free to as great an extent as practicable for j Government bonds satisfy the requirements of the continuous financing of the Government. the situation, unless accompanied by some This will be necessary so long as the war further action on the part of the buyer, since lasts, since under the present plan of financing j the securities wilich are thus disposed of are each loan is preceded by a series of certifinecessarily taken by some one who pays for cate issues designed to anticipate the actual them either out of his own income or savings placing of an issue of Liberty bonds. It j (by check on his deposit account), or else by should be evident by this time that the mere | borrowing from his banker. hasty borrowing from banks of the amount | 83463—18 2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

926 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. The war revenue bill was passed by the House existing or proposed legislation contribute in of Representatives on Septem- the same relative proportion out of surplus innue^ii?^ ^^ ber 20 and the measure now come to the needs of the Treasury as recipients goes to the Senate for action. of money incomes above the present level of It is not only by far the greatest revenue- exemption. Larger saving on the part of those raising measure in the history of the world, who are already paying taxes and purchasing intended as it is, to produce between $8,000,- bonds to the extent of their present margin, 000000 and $9,000,000,000 of income, but it together with the extension of taxation to ; must also have a profound effect upon pub- classes not now heavily burdened, and increased lic finance and the banking position of the participation in Government loans may have country. Its significance in these aspects lies to be resorted to, otherwise the inevitable rein the relationship it must bear to the question sult of the situation will be that of transferring of the distribution and absorption of the new the task of carrying the Government securities issues of bonds and certificates of indebtedness to the banks in an even larger measure than which the Treasury must place in order to ob- would otherwise be the case. tain funds for the prosecution of the war. The The legislation affecting the taxable status revenue act will render it more than ever neces- of the new bonds which has sary to bring about a definite curtailment of been ad°Pted h? Congress at unessentials both in industry and in consumpthe recommendation of the Section in order that there may be a sufficient retary of the Treasury has also an important amount of actual fluid wealth to provide for bearing on the banking outlook. This legislanational necessities. From the banking standtion, reprinted elsewhere in the present issue of point the significance of the measure is found the BULLETIN, restores the principle of exempin the effect to be exerted upon the ability of tion from taxation which was a feature of the the various institutions to pass on their securioriginal or first Liberty loan issue, but upon ties to individual buyers. If as the result of a partial and limited basis. The legislation the operation of the new taxes incomes which will give to investors in Government bonds a have already contributed what they deemed limited exemption from the surtaxes upon intheir utmost to the purchase of Government come up to a maximum of $75,000, of which bonds are less able to support the Government's $30,000 must be subscribed to the new loan. loan policy than in the past there must be re- The bonds being exempt from normal tax the sort to two kinds of remedy. More intense prospective bondholder is able to reckon upon saving must be practiced by those who are complete freedom from income taxation up to already the possessors of a savings margin which a reasonable figure. He is thus able to comthey have been devoting to the needs of the pare a yield, of 4£ per cent on Government Government; and this margin must be further bonds with a yield from other securities which enlarged in order that payment for taxation would have to be appreciably higher in order to need not infringe upon the bond purchasing afford an equality of return under the new revepower of the individual. Looking at the ques- nue legislation. As the size of the income adtion purely in its financial aspects, a second vances the inducement to purchase Government remedy for the situation could be found in the bonds in lieu of private securities is increased, beextension of taxation to those classes in the cause the surtax upon the income of the private community which have participated in the securities becomes so much greater. Inasmuch, "prosperity" resulting from the war but who however, as the smaller investors are those who have not yet been called upon to make their might conceivably obtain entire relief from contribution to the revenue needs of the Gov- taxation by putting their means into Governernment. The recipients of war wages and of ment bonds, the effect of the bond legislation war prices for natural products do not under combined with the new revenue bill is that of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1.1918. FEDEKAL RESERVE BULLETIN. 927 appealing very strongly to the small or mod- It should be noted that the figures given erate investor as compared with the person of above relate to coin and currency not held in larger resources. This is, of course, in the the Treasury or in the Federal Reserve Banks, interest of the wider distribution of the secu- these, properly speaking, constituting no part rities, since exemption from taxation ceases of the outstanding circulation in actual use as as soon as a comparatively low principal hold- currency. It should also be noted that being has been reached. From the banking tween February 1, 1917, and September 1 7 standpoint the effect of the exemption should 1918, there was a decrease in the "outstandbe that of strongly encouraging the investor to ing" volume of gold and gold certificates, become the actual owner of securities and, not offset by a substantially commensurate inonly this, but to hold them as well, since the ex- crease in the holdings of gold b^^ the Federal emption privilege is so closely hedged about by Reserve system, to the extent of about a billion restrictions that in effect make it nontra-nsfer- | dollars. There has also been a slight decrease able. This should tend to prevent the practice j in the outstanding volume of other forms of of borrowing heavily at banks for the purpose jcurrency, with the result that the net increase of carrying large amounts of bonds, and should ;in the total outstanding volume of currency similarly tend to encourage the small investor \ between the two dates has been, in round to borrow moderately and devote himself to inumbers, $736,000,000. the actual payment of his subscription with a : The fact that at the beginning of the month view to retaining the securities as a permanent ; of September there were outstanding about holding |$2,100,000,000 Federal Reserve notes (in- Apprehension having not infrequently been : creased by the end of the month to $2,300,expressed in recent months at! 000,000) has led to hasty inferences regarding Growth of Federal the rapid increase of the vol- tjhe volume and condition of the country's Reserve notes, umc of Federal Reserve notes, icurrency since the Federal Reserve note bethe following table is presented ! came the most important constituent of its to show the outstanding volume of gold coin •circulation. The truth is that, while there has and certificates, Federal Reserve notes, and jbeen a material increase in the country's total Federal Reserve bank notes, and all other •circulation, the increase is far from commenforms of currency issued in the United States, surate with the figures for the increase of for selected dates: Federal Reserve note circulation. What has been overlooked by careless observers is that Total money held outside the United States Treasury and an important change has been taking place the Federal Reserve Banks on Feb. 1, 191:7, and Sept. 1, j in the composition of our circulating medium by 1918. ': the substitution in large volume of the Federal Reserve note for the gold certificate. Feb. 1,1917. Sept. 1,1918. Moreover, to get a faithful picture of the Gold coin and gold certificates I SI, 923,388,291 8913,282,661 !situation, deduction from the total figures Federal Reserve notes and Federal I Reserve bank notes I 261,944,910 2,111,896,668 ,'should be made of the normal increase in cir- All other currency 1,731,139,217 1,627,467,179 ! culation, which would, in any case, have taken Total ] 3,916,472,418 4,652,646,508 j place. Based upon comparative figures of population this normal increase in currency Increase. Decrease. would have been about $100,000,000, so that Gold coin and gold certificates 11,010,105,630 ! the residual figure representing the growth of Federal Reserve notes and Federal Reserve bank notes $1,849,951,758 our circulation is reduced to about $636,000,000. All other currency ""iO3,"672*038 , But even from this figure deduction should be Total. 736,174,090 made if a full statement of the situation were Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

923 FEDEEAL KESEBVE BULLETIN. OCTOHKK 1, 1018. to be atlompLed, because of the increased | credit which does not correspond to immediate activity of industry, measured not simply by resources or represent a genuine demand for value of output but also by physical volume. means of exchanging goods. Allowance should also be made for the very Increased holdings of war-loan paper in conconsiderable amounts of currency which, it is Operations of necti°n with the placing of the understood, are being carried on their persons the Federal Re- two new issues of Treasury cerby prosperous wage earners who have not sorve Banks. tificates and some curtailment developed the banking habit. in the holdings of other discounts are indicated There should furthermore be deducted the by the comparative weekly figures of principal currency consisting largely of Federal Reserve earning assets of the Federal Reserve Banks notes which has been drawn from the United for the 4-weeks period, August 23 to Septem- States in substantial volume (probably in ox- ber 20. cess of 50 'millions since September, 1917) for Between these two dates the banks increased use notably in Canada, Mexico, and Cuba. their holdings of war-loan paper by 292.9 mil- Finally, the fact that the period of the year in lions, or over 3.4 per cent, while their holdings which the most rapid increase in the issue of of other discounted paper actually fell off about Federal Reserve notes has occurred synchro- 26.5 millions. All the banks show substantial nizes with tlie crop-moving season and that at | increases in their holdings of war paper. New a time when the prices of all agricultural staples I York reports the largest absolute increase under rule abnormally high, may be taken as indicat- I this head of about 120 millions, while Boston, ing that the increase in the circulation of the with an absolute increase of about 30 millions,, Federal Reserve note has been in the main in re- reports the largest relative increase of over 64 sponse to actual needs. In consequence of all of per cent. All the eastern banks, as well as which whatever inflation of prices maybe said Richmond and Chicago, show some falling off in to exist can not properly be said to have been their holdings of discounts other than war paper, induced by overissue of Federal Reserve notes. Since August 23 the proportion of war paper The really striking increase in the available i in the total discounts on hand has gone up purchasing power of the country has been fur- ! from 61.2 per cent to over 69 per cent. For nished by the deposit accounts of the banks. the Boston and Now York banks this percent- For the national banks alone this enlargement 1 age is over 80 per cent, against 55.4 and 73.3 between March 5, 1017, and. June 29, 1918, ! per cent on August 23. was about a billion dollars and is probably ! Acceptances on hand show an increase from materially greater to-day. Members of the 1 236.5 to about 250 millions, the New York Federal Reserve Board have on various occa- bank reporting under both dates about 53 per sions—most recently Governor Harding, in an cent of this class of investments. An increase address before the Ohio Bankers Association ! of 18.5 millions in United States short-term on September 5—called attention to the funda- ; obligations represents largely investments by mental truth of the situation that the expan- . the banks in 1-year 2 per cent Treasury cersion, or so-called '''inflation,7' of which coin- -, tificates to secure Federal Reserve bank note plaint is currently made, is not clue to the issue | circulation, issued by all the banks in place of of Federal Reserve notes, the notes being ' the silver dollars and certificates broken up or merely an incident or result of a process i canceled by the Treasury. United States bond begun at the individual lending banks. "In- ; holdings show a decrease of 1.6 millions, the flation," in short, occurs when loans are made 1 present holdings of 29 millions being made up upon some basis other than current produc- ; almost altogether of bonds deposited with the tion. In so far as they represent advances I United States Treasurer to secure circulation. based upon long-term investment or nonliquid I During the period under review the banks' wealth they are likely to result in inflation— ; gold reserves increased from 2,003.1 to 2,023.6 that is to say, the creation of currency or millions and their net deposits from. 1,594 to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 929 1,679.3 millions. Federal Reserve notes in But little change is noted in the aggregate actual circulation show an increase from 2,032.8 of loans secured by United States war bonds to 2,295 millions, or at the rate of over 65 mil- and certificates, the September 13 total, 473 lions per week. The ratio of cash reserves to millions, being slightly more than 3 millions aggregate net deposit and Federal Reserve note in excess of the total given four weeks earlier. liabilities declined from 56.7 to 52.9 per cent. For the banks in the central reserve cities the In the following table are shown the changes September 13 total of 252.3 shows practically between August 23 and September 20, 1918, in no change from the earlier figure. The net the total discounted and purchased bills held result of Government financing during the by each of the Federal Reserve Banks, as well four weeks under review is seen in an increase as changes between the two dates in the holdings of the aggregate of United States securities of other classes of investments: other than circulation bonds and of loans secured by United States war obligations from [000 omitted.] 2,003 to 2,130 millions. For the same period the central reserve city banks report an in- Net Federal Reserve .Hank. Aug. 23. i Sept. 20. increase. crease of this composite item from 1,062.8 to 1,130.4 millions and the Greater New York Boston : 893,854 j £113,370 819,5.16 New York : 077,685 789,365 111,680 member banks an increase from 885.2 to 946.5 Philadelphia 96,218 I 110,683 14,465 Cleveland 108,623 I 121,033 12,410 millions. Kichmond • 62,155 70,426 8,271 Atlanta 50,087 72,397 22,310 Aggregate loans and investments, exclusive Chicago : 224,343 255,720 31,377 St. Louis ; 49,022 70,047 20,425 of fixed investments, of all reporting banks de- Minneapolis 64.723 71,000 6,277 Kansas City O^OiS 71,322 8,704 clined from 13,002.7 to 12,998.4 millions, while Dallas .' 43,551 52,284 8,733 San Francisco ; <)(>,842 112,531 j 15,689 the combined share of United States war obli- Total : 1,630,821 1,910,178 ; 279,857 gations and loans secured by such obligations United States long-term seen- ' in the totals just given rose from 15.4 to 16.4 rities ' 30, C24 29,022 United States short-term sec a- • per cent. For the central reserve city banks rities 23,479 41,878 ! 18,399 Other earning assets 62 ' 84 I 22 a rise from 16.7 to 18 per cent and for the Total investments held ' 1,6S4,48(5 1,981,162 296,676 Greater New York banks a rise from 17.7 to 19.1 per cent in this ratio are shown. „ Weekly' member bank reports from leading Considerable net withdrawals of Government cities for the period August 16 deposits are shown for each week, except the B 2Sjll!SL.rf to September 13 show k mod- week of the certificate issue, the banks reporterate though steady reduction ing a total net withdrawal of Government from 554c5 to 480.2 millions in United States funds of 502.1 millions for the period under bonds, other than circulation bonds, on hand review. Central reserve city banks report a and a similar decrease In the holdings of reduction under this head of 306.2 millions and Treasury certificates up to September 6, when, the Greater New York banks a reduction of as the result of the 600-million issue of Septem- 264.2 millions. Net demand deposits of all ber 3, these holdings increased 272.4 millions reporting banks, on the other hand, show a for the week and reached a total in excess of continuous gain during the period of 351.1 1,200 millions. Since then this total declined millions, of which 173.9 millions comprises the to 1,176.7 millions. For the central reserve gain at the central reserve city banks and 165.4 cities a similar movement is noted, maximum millions—the gain at Greater New York banks. holdings of these certificates on September 6 Small gains are also shown for the total of being 672.9 millions, of which about 575 reserve balances (all carried with the Federal millions, or nearly one-half of the reported Reserve Banks) and of cash in vault. As the total, represented holdings of the member banks result largely of the heavy withdrawals of in Greater New York. Government deposits, the ratio of combined Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

930 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. reserve and cash to deposits shows a rise from weeks that have intervened since the enterprise 14.4 to 14.7 per cent for all reporting banks, was first projected there have been not a few and from 14.9 to 15.8 per cent for the banks in ' changes in the cotton situation and outlook, the central reserve cities. " Excess reserves/' \ The size of the expected crop has been mate- * in the calculation of which no account is taken ; rially reduced and the price, which had shown a of Government deposits, reached the high level j disposition to decline, has again risen. On the of 136.5 millions on August 30. Since then a j other hand, the War Industries Board has large reduction is noted, the low level of 46.1 i announced the adoption of a definite policy millions being shown on September 13. For \ probably involving the Government purchasing the central reserve cities a similar development j of cotton and possibly the fixing of basic prices is noted, the maximum of 109.3 millions being I for at least some grades of the staple. Nevershown on August 30, and the minimum of 29.4 [ theless, the new corporation has a large field millions on September 13. of activity before it. Governor Harding, in During the month ending September 10 the j his addresses before the Cotton Conference in net outward movement of gold j New York City last June, strongly indorsed the Movement of was $1,755,000, as compared j application of the acceptance plan in the cotton gold. with a net outward movement j trade, pointing out that it was practically a of 84,376,000 for the month ending August 10. j further application of the same idea that has Gold imports for the month, amounting to j already been adopted in connection with inter- Si,790,000, came largely from Mexico, Canada,j national trade in staples whose movement and Colombia, while gold exports, totaling j gives rise to prime bills which are readily mar- $3,545,000, were consigned chiefly to Mexico, j keted. It is in this and similar directions that The gain in the country's stock of gold since j the proper field for the development of the August 1, 1914, was $1,072,252,000, as may be acceptance is to be found, and not in the finanseen from the following exhibit: cing or carrying of stored products or in the collection of accounts of long or doubtful stand- [000 omitted.] j ing, some of which represent goods already F.xcess of consumed. The introduction of the acceptimports Imports. Exports. over ex- ance plan in moving the cotton crop may have ports. results of very considerable immediate im- | portance, but success in it will necessitate an Aus. 1 to Dec. 31, 1914 $23,253 8104,972 Jan.. 1 to Dec. 31, 1915 453,955 31,426 420.529 adjustment and modification of previously Jan. 1 to Dec. 31, 1916 685,745 155,793 529,952 Jan. 1 to Dec. 33, 1917 553,713 372,173 181,542 existing practices. This work can be better Jan. 1 to Sept. U), 1918 34,761 32,813 21,948 done, it seems likely, through an actual busi- Total I 1,769,427 697,175 1,072,232 ness enterprise engaged in financing the accepti Excess of exports over imports. ances growing out of cotton movement, than The formation of the Union Discount Cor- through purely general or theoretical explanaporation, whose projected plan tion or discussion. of organization is elsewhere The bill embodying amendments to the Fedpublished, is of special interest Amendments to eral Eeserve Act was signed by because of the bearing it has upon the financing the Federal Re- the President on September 26. of the cotton crop. While the enterprise is serve Act k ]j der authorized to do a general commercial discount Thig measure as een un consideration for several months past, and the business, it has been announced that one of its agreement now arrived at represents the outprincipal functions will be that of financing the come of elaborate legislative discussion. So cotton crop through the use of acceptance fully has the scope of these amendments been paper—both bankers' and trade. During the dealt with in past issues of the FEDERAL RE- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN". 931 SERVE BULLETIN that no comment upon them The Federal Advisory Council held its regular is called for further than to say that the effects quarterly session on September of the new measure will be to place national and 16 and 17>two Joint isessions State banks and trust companies more nearly being held with the Federal upon a basis of equality of opportunity and com- Eeserve Board. The existing financial situapetition than in the past, and that the Board tion was fully discussed, and the CounciFexbelieves the tendency of the legislation will conpressed itself as being in entire accord with the sequently be toward strengthening and broaddiscount policy at present pursued by the ening the Federal Eeserve system. The change Board, feeling that satisfactory progress is made by the bill in the methods of electing being made in the curtailment of nonessential directors at Federal Keserve Banks is expected and less essential credits, and that proper to bring about a more equitable and reasonable regulation of the entire credit situation can be representation for all classes of banking instiaccomplished without further advances in tutions. discount rates. With the view of easing the movement of Other topics discussed had to do with the currency from point to point gold export situation and allied problems. ren E c a y si n m g o t v h e e m c e u n r t - . fixn e rF epareWraal l r " e R s P e Q r P v TV e P .t T f V oa » r ^ a rr l n h a < s *o. Discussion also necessarily dealt to some extent proposed a plan under which with the conditions under which loans to the the Federal Eeserve Banks would absorb the Government are to be placed and the relationcost of distributing Federal Eeserve notes to ship between the banking situation and public their member banks—a charge which has herefinance. It was the feeling that present tofore been imposed upon the banks that policies should be continued and that, all applied for issues of new notes. Federal Eethings considered, as good progress as could be serve Banks are now paying the cost of transexpected is being made in the protection and portation on Federal Eeserve notes from Washconservation of banking credit. ington, and these notes are available to banks located in Federal Eeserve and Federal Eeserve Conservation of Productive Power and Credit, branch cities without charge for delivery. During the month of September several The banks have also abolished their service important steps were taken that will be a charges for collecting checks, and in many cases material factor in furthering the policy which they are paying all transportation charges in the Federal Eeserve Board has long urged— the conservation of credit and productive power connection with the exchange of currency for and their application to the maintenance of gold, as well as charges on currency forwarded necessary enterprises to the exclusion of those b}^ country banks to offset debits made against deemed less requisite. them represented by the total footings of letters containing checks for collection. It is GOVERNMENT ACTION TO INSURE CONSERVATION. thought that the extension of the privileges Believing that fundamental action designed above indicated to member banks will remove to mark out the line of distinction between essential and unessential industries is necessary the feeling that many country banks have by way of supplementing and making effective that the Federal Eeserve Act discriminates the efforts hitherto underta ken for the control of against them in favor of the banks in the larger jindustrial operations, the War Industries Board cities, and will at the same time prove an added j on September 8 made public an authoritative stimulus to the State banks to apply for mem- !list of preferred industries to serve as the basis bership. Should the plan be adopted thej for the allocation of labor, material, transportation, and fuel and as the basis for industrial Board would, of course, reserve the right to j exemption from the draft: modify or rescind it at any time upon reason-! The preference list of industries and plants, compiled able notice. by the priorities division of the War Industries Board, is Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

932 FEDERAL BESBEVE BULLETIN. OCTOliEU 1, 1918. herewith presented. This list is the master-key governing confusion. The unprecedented expansion of the Army the flow of basic industrial elements to the industries and of the Navy of the United States, the creation of the essential t© the war program. It supersedes all previous Emergency Fleet Corporation to engage in shipbuilding on f listing. an extraordinary scale, and the demands made by our It is the basis for industrial exemption from the draft, allies for munitions, material, equipment, fuel, foods and and may be regarded as the governing factor in the distri- feeds, the abrupt change from a peace to a war basis have bution of labor, capital, facilities, material, transportation, all combined to create abnormal industrial conditions in and fuel. the United States, to regulate which the law of supply and MAJOR INDUSTRIES GROUPED. demand and other economic laws applicable to normal conditions are whollj7" inadequate. . The administration of The priorities division has grouped major industries priorities is calculated to bring order out of chaos and to according to their relative importance into four great develop an evenly balanced industrial program to meet the •classes, consideration being given in this grouping to these requirements of the military program, and at the same time factors: (1) Intrinsic importance of the product for use supply the essential requirements (as distinguished from during the war and the urgency; (2) necessity for mainthe mere wants or desires) of the civilian population. Now taining or stimulating and increasing the total quantity of that it is understood that priority and preference can not be production; (3) proportion of the capacity of the industry purchased, the tendency is for prices to assume more nearor plant devoted to the production of essential products. ly the normal level. It is now the public interest rather Each industry or plant is given a class number. Chan the dollars of the purchaser that determines prece- Judge E. B. Parker, chairman of the priorities division. dence in production and delivery." states the determination of the relative importance of all Closely associated with the promulgation of this new industries and plants for both production and delivery by preference list by the War Industries Board is the great a single agency, the War Industries Board, renders it necessity for conservation in every possible way of men, possible to maintain a well-balanced program with respect material, transportation and all energies that go to placing to the several factors entering into production, which the United States with all its power and resources behind includes, among other things, plant facilities, fuel supply, its men at the front in winning the war. It is necessary or electrical energy, labor, and transportation, without all now more than ever to save to the point of sacrifice so that of which production is impossible. demand may be held to the bone, enabling supply to go as Where it is imperative not only to maintain, but to stim- far as possible. ulate and increase, production to supply abnormal de- THE PREFERENCE LIST. mands created by war requirements, a high rating is necessary even though the intrinsic importance of the product The preference list follows: may be less than that of other products placed in the lower t NOTE.—The list is complete, except for the table showclassification, due to the fact that the supply of such other ing industries grouped by classes. The list is given alphaproducts equals the demand without the stimulus of high betically with the class number opposite each group. priority. Certain plants produce commodities of more relative importance, but at the same time produce other WAR INDUSTRIES BOARD, commodities of less relative importance and under such PRIORITIES DIVISION, circumstances consideration and weight is given to the Washington, D. C, Septembers, 1918. ratio of production between the more important and less important commodities. [Circular No. 20.] NOT INTENDED AS EMBARGO. PREFERENCE LIST NO. 2, ISSUED SEPTEMBER 3S 1918. [Superseding Preference List No. 1, issued Apr. 6, 1918, and all amend- The inclusion of the industries and plants on this prefer- ments and supplements thereto.] ence list does not operate as an embargo against all others, but the effect is to defer the requirements of all other in- FOREWORD. dustries and plants until the requirements of those on the preference list shall have been satisfied. The paramount The President has placed upon the chairman oi the purpose of priorities is the selective mobilization of the War Industries Board the responsibility for determining products of the soil, the mines, and factories for direct and and administering all priorities in production and delivery. indirect war needs in such a way as will most effectually The determination of the relative importance of all incontribute toward winning the war. dustries and plants for both production and delivery by In listing industries as such or individual plants, while a single agency renders it possibly to reasonably maintain a number of factors are taken into account, the ultimate a well-balanced program with respect to the several factest is: To what extent, if at all, will according preference tors entering into production, which include (a) plant contribute directly or indirectly toward winning the war: facilities, (b) fuel supply or electric energy, or both (c) and, if at all, how urgent is the need. supply of raw materials and finished products, (d) labor, A high priority classification does not always mean that &nd (e) transportation by rail, water, pipe lines, or otherthe product of the industry of plant so classified is of greater wise. Without all of these—speaking generally—producintrinsic importance than those of industries and plants tion is-impossible. in a lower classification or not appearing at all on the prefer- In compliance with the directions oi the President that ence list, but that talcing into account the urgency of the plans be formulated whereby there may be ''common, demand and the relation of supply to demand, it is in the consistent, and concerted action" in carrying into effect public interest that the artificial stimulus of priority should I all priority policies and decisions, the chairman of the War be applied. All priority is relative and implies purpose- | Industries Board has created a priorities board, with the ful discrimination. j priorities commissioner of the War Industires Board as Continuing, Judge Parker says: I chairman, consisting of (1) the chairman of the Wai- In- ''Without a central agency to determine the relative | dustries Board, (2) the priorities commissioner, (3) a meraneeds, importance and urgency of the requirements of | ber of the I-tailroad Administration, (4.) a member of the each department of this Government, of its allies and of the United States Shipping Board Emergency Fleet Corpocivilian population, there would be hopeless conflict and ! ration, (5) a member of the War Trade Board, ((>) a member Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 933 of the Food Administration, (7) a member of the Fuel erence so long as they are rendering, and so long as it is in Administration, (8) a representative of the War Depart- the public interest that they should render, a particular ment, (9) a representative of the Navy Department, (10) service, even though, taking the country as a whole, the a member of the Allied Purchasing Commission, and (11) supply of their product is ample to meet all demands. the chairman of the War Labor Policies Board. No distinction has been made between any of the in- The decisions of the priori lies board are subject to re- dustries or plants within any one class, and no significance view only by the chairman of the War Industries Board attaches to the order in which industries and plants are and by the President. listed within any class. For the guidance of all governmental agencies and all The industries and plants grouped under Class I are others interested in (1) the production and supply of fuel only such as are of exceptional importance in connection and electric energy, (2) in the supply of labor, and (3) with the prosecution of the war. Their requirements must in the supply of transportation service by rail, water, be fully satisfied in preference to those of the three repipe lines, or otherwise, in so far as such service con- maining classes. tributes to production of finished products, the accom- Requirements of industries and plants grouped under panying designated Preference List No. 2 has been adopted Class II. Class III. and Class IV shall have precedence by the priorities board superseding Preference List No. 1 over those not appearing on the preference list. As beadopted April 6, 1918, and all amendments and supple- tween these three classes, however, there shall be no comments thereto. plete or absolute preference. The division into classes is Where advisable industries as such have been classified for the purpose of presenting a composite picture of the and listed. In numerous instances individual plants have relative importance of the industries and plants embraced been found to be entitled to preference, although the within each group. It is not intended that the requireindustries to which they belong are not, and in other ments of Class II shall be fully satisfied before supplying instances where an industry as such has been accorded a any of the requirements of Class III. or that those of Class degree of preference particular plants in such industry lit shall be fully satisfied before supplying any of those of have been placed in a higher class. This has necessitated Class IV. The classification does, however, indicate that classifying and listing not only industries as such but to the industries and plants grouped in Class II are relatively a limited extent individual plants, some of which are more important than those in Class III, and that those in accorded a higher rating than that accorded the listed Class III are relatively more important than those in Class industry to which they belong. IV. It will often happen that after satisfying the require- The Preference List is made up of industries and plants ments of Class I the remaining available supply will be which in the public interest are deemed entitled to pref- less than the aggregate requirements of the other three erential treatment. The inclusion of these industries and classes, in which event such supply will be rationed to the plants on this list does not operate as an embargo against industries and plants embraced within those classes. In all others, but the effect is to defer the requirements of determining a basis for such rationing the relative imall other industries and plants until the requirements of portance of each industry and plant, according to its class those on the Preference List shall have been satisfied. rating, must be considered. It has been found imprac- In the compilation of this list industries and plants have ticable to prescribe for rationing purposes any general and been divided according to their relative importance into uniform rule or formula, but the priorities board will from four classes, viz, Class 1, Claso II, Class III, and Claps IV. time to time, after conference, and in cooperation with In determining such relative importance consideration and each of the several governmental agencies charged with weight have been given not solely to any one, but to all the distribution thereof, determine particular principles, of the following factors: (1) The intrinsic importance of values, and methods of application which may be followed the product itself for use during the war, and the urgency, in allocating fuel, power, transportation, and labor, reas measured by time, of the demand or of the use to which spectively, to the end that proper recognition and weight it is to be put; (2) the necessity for maintaining or stimu- may as far as practicable in each case be given to the relalating and increasing the total quantity of production, tive importance of Class II. Class III, and Class IV. which in turn depends largely upon the relation of the Each plant listed as such shall, not later than the 15th supply to the demand for essential uses; (3) the proportion of each month, file with the secretary of the priorities of the capacity of the industry or plant which is devoted board, Washington, D. C, a report on P. L. Form No. 3 to the production of the essential product. (a supply of which will be furnished on application) Where it is imperative not only to maintain but to covering its activities during the preceding month. Any stimulate and increase production to satisfy abnormal plant failing to file such report will be dropped from the demands created by war requirements, a high rating is preference list. necessary, even though the intrinsic importance of the Priorities in the supply and distribution of raw materials, product may be less than of other products placed in a semifinished products, and finished products shall be govlower classification due to the fact that the supply of such erned by circular No. 4 issued by the priorities division other products equals the demand without the stimulus of the War Industries Board under date of July 1, 1918, of high priority. Where it is necessary to speed the pro- and all amendments and supplements thereto or substiduction of a particular product required at a particular tutes therefor. time to carry into effect an important program, a high The term "principally"' as used in listing industries priority is given, although changing conditions may there- shall be construed to mean plants whose output is not less after suggest and demand a reclassification. Certain plants than 75 per cent of the products mentioned. produce commodities of great relative importance, but at This preference list shall be amended or revised from time the same time produce other commodities of less relative to time by action of the priorities board to meet changing importance, and under such circumstances consideration conditions. The priorities commissioner shall, under the and weight is given to the ratio of production between the direction of and with the approval of the priorities board, more important and less important commodities. Instances certify additional classes of industries and also certify adoccasionally arise where individual plants are given pref- ditional plants whose operations as a war measure entitle 83463—18 3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

934 FEDERAL RESERVE BULLETIN. OCTOBER 1, 1918. them to preference treatment, which industries and Class. Guns (large): Plants engaged prinicpally in manufacturing same plants when so certified shall be automatically included for the United States Government and the allies I in the preference list. Hospitals. (See Public institutions and buildings.) EDWIN B. PARKER, Ice: Plants engaged principally In manufacturing same Ill Priorities Commissioner. Insecticides and "fungicides: Plants engaged principally in manufacturing same .• IV Approved. Laundries IV Machine tools: Plants engaged principally in manufacturing BERNARD M. BARUCH, same II Chairman, War Industries Board. Medicines. (See Drugs and medicines.) Mines: Coal I Mines: Producing metals and ferroalloy minerals II INDUSTRIES. Mines: Plants engaged principally in manufacturing mining tools or equipment Ill Navy. (See Army and Navy.) [Listed alphabetically.] Navy Department. (See War and Navy Departments.) Class. Newspapers and periodicals: Plants engaged principally in print- Agricultural implements. (See Farm implements.) ing newspapers or periodicals which are entered at the post Aircraft: Plants engaged principally in manufacturing aircraft or office as second-class mail matter IV aircraft supplies and equipment I Oil and gas: Plants engaged principally in producing oil or natural Ammunition: Plants engaged principally in manufacturing same gas for fuel, or for mechanical purposes, including refining or ior the United States Government and the allies I manufacturing oil for fuel, or for mechanical purposes I Army and Navy: Arsenals and navy yards 2 Oil and gas: Pipe lines and pumping stations engaged in trans- Army and Navy: Cantonments and camps I porting oil or natrual gas I Arms (small): Plants engaged principally in manufacturing same Oil and gas: Plants engaged principally in manufacturing equipfor the United States Government and the allies I ment or supplies for producing or transporting oil or natural Bags: Hemp, jute, and cotton—plants engaged principally in gas, or for refining and manufacturing oil for fuel or for mechanmanufacturing same IV ical purposes '. Ill Blast furnaces (producing pig iron) I Paper and pulp. (See Pulp and paper.) Boots and shoes: Plants engaged exclusively in manufacturing Periodicals. (See Newspapers and periodicals.) same IV Public institutions and buildmgs (maintenance and operation Brass and copper: Plants engaged principally in rolling, and draw- of) other than hospitals and sanitariums Ill ing copper" brass, and other copper alloys in the form of sheets, Public institutions and buildings (maintenance and operation rods, wire, and tubes II of) used as hospitals or sanitariums I Buildmgs. (See Public institutions and buildings.) Public utilities: Gas plants producing toluol I Chain: Plants engaged principally in manufacturing iron and steel Public utilities: Street railways, electric lighting and power comchain Ill panies, gas plants not otherwise classified, telephone and tele- Chemicals: Plants engaged principally in manufacturing chemicals graph companies, water-supply companies, and like general for the production of military and naval explosives, ammunition, utilities II and aircraft, and use in chemical warfare I Public utilities: Plants engaged principally in manufacturing Chemicals: Plants, not otherwise classified and listed, engaged equipment for railways or other public utilities II principally in manufacturing chemicals IV Pulp and paper: Plants engaged exclusively in manufacturing Coke: Plants engaged principally in producing metallurgical coke same IV and by-products, including toluol, i I Railways: Operated by United States Railroad Administration.. I Coke: Plants not otherwise classified and listed, producing same.. II Railways: Not operated by United States Railroad Administra- Copper and brass. (See Brass and copper.) tion (excluding'those operated as plant facilities) II Cotton: Plants engaged in the compression of cotton IV Railways (street). (See Public utilities.) Cotton textiles. (See Textiles.) Rope. (See Twine and rope.) Cranes: Plants engaged principally in manufacturing locomotive Rope wire. (See Wire rope.) or traveling cranes II Sanitariums. (See Public institutions and buildings.) (The term "principally" means 75 per cent of the products Ships (maintenance and operation of): Excluding pleasure craft mentioned.) not common carriers Domestic consumers: Fuel and electric energy for residential Ships: Plants engaged principally in building ships, excluding consumption, including homes, apartment houses, residential (a) pleasure craft not common carriers, (h) ships not built for the flats, restaurants, and hotels United States Government or the allies nor under license from Domestic consumers: Fuel and electric energy not otherwise United States Shipping Board I specifically listed Ill Soap: Plants engaged principally in manufacturing same IV Drugs: Medicines and medical and surgical supplies, plants en- Steel-making furnaces: Plants engaged solely in manufacturing gaged principally in manufacturing same IV ingots and steel castings by the open-hearth, Bessemer, crucible, Electrical equipment: Plants engaged prinicpally in manufac- or electric-furnace process, including blooming mills, billet turing same * Ill mills, and slabbing mills for same I Explosives: Plants engaged principally in manufacturing same Steel-plate mills I for military and naval purposes for the United States Govern- Steel-rail mills: Rolling rails, 50 or more pounds per yard II ment and the allies Steel: All plants operating steel rolling and drawing mills, exclu- Explosives: Plants not otherwise classified or listed, engaged sive of those taking higher classification Ill principally in manufacturing same Ill Surgical supplies. (See Drugs and Medicines.) Farm implements: Plants engaged principally in manufacturing Tanners: Plants engaged principally in tanning leather IV agricultural implements and farm-operating equipment IV Tanning: Plants engaged principally in manufacturing tanning Feed: Plants engaged principally in preparing or manufacturing extracts IV feed for live stock and poultry Textiles: Plants engaged principally in manufacturing cotton Ferroalloys: Plants engaged principally in producing ferrochrome, textiles, including spinning, weaving, and finishing IV ferromanganese, ferromolybdenum, ferrosilicon, ferrotungsten, Textiles: Plants engaged principally in manufacturing woolen ferrouranium, ferrovanadium, and ferrozirconium II textiles, including spinners, top makers, and weavers IV Fertilizers: Plants engaged principally in producing same IV Textiles: Plants engaged principally in manufacturing cotton or Fire brick: Plants engaged principally in manufacturing same.. IV woolen knit goods IV Foods: Plants engaged principally in producing, milling, refining, Textiles: Plants engaged principally in manufacturing textile preserving, refrigerating, wholesaling, or storing food for human machinery IV consumption embraced within the following description: All Tin plates: Plants engaged principally in manufacturing same... Ill cereals and cereal products, meats, including poultry, fish, Tobacco: Only for preserving, drying, curing, packing, and storing vegetables, fruit, sugar, sirups, glucose, butter, eggs, cheese, same—not for manufacturing and marketing IV • milk and cream, lard, lard compounds, oleomargarine and Toluol. (See Coke; also Public utilities.) other substitutes for butter or lard, vegetable oils, beans, salt, Tools: Plants engaged principally in manufacturing small or hand coffee, baking powder, soda and yeast; also ammonia for re- " tools for working wood or metal Ill frigeration Twine (binder and rope): Plants engaged principally in manufac- Foods: Plants engaged principally in producing, milling, pre- turing same IV paring, refining, preserving, refrigerating or storing food for War and Navy Departments: Construction work conducted by human consumption not otherwise specificalty listed; except- either the War Department or the Navy Department of the ing herefrom plants producing confectionery, soft drinks, and United States in embarkation ports, harbors, fortified places, chewing gum Ill flood-protection operations, docks, locks, channels, inland Food containers: Plants engaged principally in manufacturing waterways, and in the maintenance and repair of same II same '. Wire rope and rope wire: Plants engaged principally in manufac- Foundries (iron): Plants engaged principally in the manufacture turing same .*...! n of gray iron and malleable iron castings iv Woolen textiles. (See Textiles.) Fungicides. (See Insecticides and fungicides.) (The term "principally" means 75 per cent of the products Gas. (See oil and gas, also Public utilities.) mentioned.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 935 RESTRICTIONS ON SPECULATION. I am also directed by the committee to express its cordial appreciation of the spirit of cooperation which In order to insure that there be devoted has always been shown by the officers and members of the stock exchange in matters of this kind, which feeling to the operations in the security markets only is shared by the officers of the Federal Reserve Bank. the amount of credit resources absolutely Very truly, yours, necessary and to prevent the use of additional BENJ. STRONG, credit beyond the funds now so used, thereby Chairman of the Liberty Loan Subcommittee on Money. checking any tendency to expand the collateral- W. PI. G. NOBLE, Esq., loan account, there has been transmitted by President, Neiu York Stock Exchange, Mr. Benjamin Strong, chairman of the Liberty New York, N. Y. loan subcommittee on money for the New York The recommendations made by Mr. Strong district, to Mr. W. H. G. Noble, president of on behalf of the committee are, it is underthe stock exchange, a letter as follows: stood, being followed by the members of the stock exchange as requested. SEPTEMBER 5, 1918. MY DEAR SIR: As you are aware, a subcommittee of the Liberty loan committee of this district was appointed on CURTAILMENT OF LOANS. September 5, 1917, and has undertaken certain duties in connection with the New York City money market, for the purpose of securing the most complete cooperation Most of the Federal Reserve Banks have with the Government in its financial program by all the endeavored in their various appropriate ways financial interests of the city. The members of the to encourage the conservation of credit in subcommittee are the following gentlemen: Benj. Strong (chairman), James S. Alexander, George F. Baker, Walter their several districts. The methods pursued E. Frew, Gates W. McGarrah, Charles H. Sabin, Frank A. have been in the main those of obtaining gen- Vanderlip, James N. Wallace, Albert II. Wiggin. eral informal agreement among bankers as to The work of the subcommittee has met with the cordial the classes of enterprise that were to be recooperation of the important interests connected with the garded as essential and so far as practicable New York money market and there has been maintained an orderly course of affairs in which the supply of funds has encouraging the development of a systematic been ample for the essential needs. We believe this condi- plan on the part of individuals and corporation can be continued. It is obvious, however, that for tions for the support of the Government. The the present there should be devoted to the security market no additional credit beyond the funds now so used. Any Federal Reserve Bank of New York on August tendency to expand the collateral loan account should, 23 transmitted to the banks of its district and for the general good, under present conditions, be checked. to their depositors letters as follows: In order that this important situation may be handled in a way that will result in the least possible inconvenience, DEAR SIR: The Federal Reserve Board wrote you on it is desirable that we should have a complete daily view July 6 relative to the necessity of conserving credit in order of stock exchange loans. We recognize the disposition to furnish the Government the increasing volume of credit of the stock exchange to cooperate in every way toward it requires to finance the war, and the directors of this bank contributing to the orderly conduct of the money market 1 have instructed its officers to discuss the subject further and, depending upon that patriotic disposition, we now with every bank in the district. While no general rules or ask the governors of the stock exchange to collect, for the program for the conservation of credit can be laid down, confidential use of this committee, daily statements from the duty of each bank is to do its share in securing the each member of the exchange showing, in such detail as: desired results, acting reasonably and judiciously, in such may be agreed upon in conference, the amount of time ways as its own conditions make practicable and as will and call loans of each stock exchange house. spare borrowers undue embarrassment. We have no doubt This information will be for the confidential use of the that, like most bankers, you have already made some committee in whose hands has been placed the responsi- progress toward conserving credit, and our directors wish bility for maintaining an orderly money market. The to supplement the Federal Reserve Board's letter by askreports will bo asked i'or during a temporary period. At | ing you now to take up this necessary work systematically the present time it is impossible for us to say for just how j and conscientiously. long a period they will be needed. We will be obliged | Saving of credit by banks, in order to help the situation if you will ask the members of the exchange to begin| as a whole, must be the result of saving on the part of borthese reports at the earliest date practicable. I rowers. Shifting loans from one institution to another, or Lest any possible misunderstanding arise as to the object sales of collateral which merely throw the burden upon of this request, I am directed by the committee to explain other shoulders, save no credit. Credit conservation can that this is only one of the number of measures being only be accomplished by business or personal economies, undertaken by the committee with the object of exercising, and requires cooperation between banks and their borrowby mutual understanding among the institutions and firms ers, and education of borrowers by their banks. in this city, such reasonable and necessary control of the Producers, manufacturers, and merchants may do their employment of credit as will insure no interference with part and reduce their credit requirements— the financial operations of the Government in conducting By not overbuying; the war. By carrying as small stocks as practicable; Accurate information as to the amount of bank credit By postponing new construction, or expansion of their being employed for stock exchange purposes will be useful business; in attaining these objects. By effecting business economies. 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936 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Individuals may do their part by studying their personal By postponing new construction or expansion of their expenses and effecting economies which will enable them business; gradually to pay off their loans. By effecting business economies. May we suggest that you make a careful analysis of your The way for individuals to do their share and reduce loans and lines of discount in order to determine definitely their loans is to study their personal expenses and effect what credit now in use is not directly connected with economies. Government financing, or the production or distribution Borrowers whose loans are secured by Government bonds of things necessary to maintain the health and efficiency or other collateral should remember that reduction of loans of our armed forces and our civilian population. While by selling collateral is not helpful, since it usually merely the majority of bank loans will prove to be for these shifts the burden to other shoulders. purposes, most institutions also have a considerable The hanks are asked to save their credit, which means volume of loans to individuals made for other purposes, that their customers must use less of it. The saving of many of them of long standing. It is to loans of this credit is an integral part of the great saving policy which character as well as to the less necessary commercial bor- the war requires the Government to adopt, and every man, rowings, that credit conservation should first be applied. woman, and child to support to the utmost. Saving to New commercial lines or new loans to acquire or improve reduce loans is a patriotic sendee only second in imporproperty, or for nonproductive purposes, will rarely be tance to saving to buy Liberty bonds and war savings justified unless they are to aid directly in the prosecution stamps. Both help to transfer to the Government the of the war. A spirit of saving in the use of credit will ability to command the labor and materials of which naturally lead the banks themselves to exercise restraint President Wilson has said the allies are in such desperate in offering new or additional lines of credit in competing need. Both also help to accumulate for the saver a purfor business. A frank discussion of the principles and the chasing power which hs may need when the war is over. necessity of credit conservation with a borrower will The Federal Reserve Bank of New York asks the banks usually gain his cooperation, and where a borrower is in its district to send this message to their depositors, asked to reduce a loan having securities or commodities as feeling sure that it will meet with their prompt cooperacollateral, emphasis should be laid on the necessity of tion. gradual and steady reduction by personal economies rather FEDERAL RESERVE BANK OF NEW YORK. than by selling the collateral. NEW YORK, August 23, 1918. Several of our member banks, wishing to discuss the matter with their borrowers, have asked us to prepare a USE OF CREDIT FOK GOVERNMENT NEEDS. brief statement on the subject. We have prepared such a statement, which banks, if they so desire, may either use The effort to bring about a general conservaas a form letter or inclose with a letter of their own. We tion of credit by preventing its use for unesshall be glad to furnish either statement in any quantity sential purposes has been paralleled and exto any bank in the district. Copies are herewith inclosed. Will you be so good as to acknowledge this letter, advis- tended by the effort to bring about the defiing us what you are doing or are willing to do in order to nite application of credit so saved or conserved save credit and giving us your views as to the best method to the needs of the Government. Most of the of accomplishing the necessary results? We suggest that banks have already been doing their utmost one most effective step would be for all the banks in your city or county to reach an agreement for common action. to meet the requirements of the Treasury Whenever this bank can properly assist, you may count Department, but in various parts of the counupon our cooperation. try it has been sought to bring about a complete or more general cooperation. The following letter sent to banks in the State of To bank depositors: Utah by the banking commissioner of that Nothing is more vital to the winning of the war than State furnishes an example of the work that credit. The Government often has to borrow immense sums, is being done in that direction: temporarily, and the banks must stand ready at all times to lend the Government what it needs. The ability of the AUGUST 26, 1918. banks to lend is not unlimited. It is just as necessary for To the bank or trust company addressed: them to conserve their lending power as it is to conserve In anticipation of the fourth Liberty loan, the Governcoal, food, steel, and other commodities for which the war ment a short time ago made a demand upon all banks of brings abnormal demands. Those who are producing, the United States to invest 20 per cent of their total manufacturing, or distributing things needed to prosecute resources in 4} per cent United States temporary Treasury the war or maintain the health and efficiency of the civilian certificates. population, will be able to obtain the credit to which their Upon my recent visit to San Francisco, I had occasion needs and their standing entitle them; but new loans will to go over the files in the office of E. W. Wilson, director rarely be justified unless they are to aid directly in the of sales, showing what our State banks have purchased in prosecution of the war, and every bank has been asked by these certificates. To my great surprise, I discovered the Government to request all it borrowers to keep their that some of the banks have not purchased a single cerdemands for credit down to the very minimum. tificate of any offering. Others have taken a part of their Patriotic citizens, whether in business or not, will want- allotments, while some have taken their allotments of to cooperate with this necessary Government policy. every offering. A. few of our banks can not carry the The way for producers, manufacturers, and merchants entire load, but there is an equal responsibility resting to do their share and reduce their credit requirements is— upon every bank and each should do its full part. By not overbuying; Bankers, we must win this war and every bank must do By carrying as'small stocks as practicable; its full duty. Nothing short of taking your full allotment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL EESEEVE BULLETIN. 937 of these Treasury certificates at this time will accomplish The Fourth Liberty Loan. the demands and needs of our Government. Banks who have not yet purchased your allotments of The Secretary of the Treasury announced on these certificates, get busy and take up your delinquent allotments, as well as the future ones, as the calls are September 24 that the amount of the fourth made, so that when these offerings are withdrawn every Liberty loan would be $6,000,000,000; that bank in this State will be a 100 per cent purchaser of these certificates. the rate of interest would be 4i per cent, and If your institution has not the money with which to the bonds would mature on October 15, 1938, make these purchases without injury to your business, your needs can be supplied through your correspondent but would be redeemable at the pleasure of the bank, who will loan you the money on your note at 4J per United States at par and accrued interest on cent, the same rate the certificates bear, so that you are out nothing, but at the same time you are helping meet and after October 15, 1933. the needs of the Government. The campaign will open September 28 and The following resolution was unanimously passed by the Salt Lake Clearing House Association at a special close October 19, 1918, and all subscriptions meeting called July 23, 1918: must be filed on or before the latter date, ac- "Resolved, That the Salt Lake City Clearing House Association does hereby pledge and agree that each of its companied by an initial payment of 10 per members will purchase its full allotment of United States cent. Subscribers are given the privilege of Treasury 4J per cent certificates as and when they are offered; and paying in full for their subscription without "Resolved, That each bank member hereby agrees to rebate of interest at the time of application. carry its bank customers located in Utah that are nonmembers of the Federal Reserve system for their full allot- Quotas assigned to the several Federal Rement of Treasury certificates at the rate of 4£ per cent per serve districts are as follows: annum, upon the promissory note of said bank running for a period not to exceed 90 days." Similar resolutions have been passed by other clearing Per cent. | Amount. house associations in this State. You may argue that you do not want to show bills payable on your books, but in the minds of big bankers in Boston $500,000,000 the United States this dread has passed. _ Banks that New York 30.00 1,800,000,000 Philadelphia... 8.33J 500,000,000 have never shown borrowed money in their history of Cleveland , 10.00 600,000,000 banking are now showing bills payable upon their books, Richmond 4.66§ 280,000,000 and are doing their utmost to help win the war, and which Atlanta , 3.20 192,000,000 Chicago , 14. 50 870,000,000 should be the object of every banker in the United States, St. Louis 4.33J 260,000,000 both large and small. Minneapolis 3.50 210,000,000 Your banks receive from time to time circular letters, K Da a l n l s a a s s City.... 4 2 . . 1 3 0 3} 2 1 6 2 0 6 , , 0 0 0 0 0 0 , , 0 0 0 0 0 0 telegrams, etc., from E. W. Wilson, director of sales. San Francisco. 6.70 402,000,000 United States Treasury certificates of this district All these communications should be given careful considera- Total 100.00 ! 6,000,000,000 tion, with the result of prompt action. Yours, very truly, In alloting these quotas the Treasury De- (Signed) W. E. EVANS, partment has taken into account the condi- Bank Commissioner. tions existing in various parts of the country^ LIMITATION OF SECURITIES ISSUED. as well as the banking resources. The Capital Issues Committee, in a resolution adopted on September 9, directed that further issues of securities during the period Purchase of Stock of International Banking of the loan should be suspended, the resolution Corporation. in question reading as follows: Resolved, That in view of the paramount importance of The Federal Reserve Board has granted permeeting the Government's financial requirements for war mission, under section 25 of the ^Federal purposes, the Capital Issues Committee will not pass any application respecting the sale or offer for sale of shares or Reserve Act, to the National City Bank of securities during the period from September 15,1918, until New York to invest in the stock of the Interafter the close of the fourth Liberty loan campaign, except applications which the committee may regard as urgently national Banking Corporation a sum not exceednecessary. Investment houses, brokers, corporations, ing 10 per cent of its capital and surplus. The and others offering the unsold portion of security issues heretofore passed by the Capital Issues Committee are National City Bank has a capital of $25,000,000 asked to withdraw the same from public offering or solicita- and surplus of $35,000,000. The International tion during the period from October 1 to the close of the Liberty loan campaign in order to give the Government Banking Corporation is incorporated under the the right of way. This action is not intended to restrict laws of the State of Connecticut and is engaged counter sales or sales of listed securities made in ordinary course of business on stock exchanges. primarily in the business of foreign banking. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

938 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Branch of the National City Bank in Cuba. Q. M. C. Form 40. Approved by Comptroller of Treasury. 'June 15,1918. Permission has been granted by the Federal [FRONT.] Reserve Board to the National t!ity Bank of UNITED STATES WAR DEPARTMENT. New York to establish in Sagua La Grande, QUARTERMASTER CORPS. Kepublic of Cuba, a subbranch, agency, or W.'S. S. No. office of its branch, with main office in Habana. MEAL TICKET. ORIGINAL. To any Hotel, Restaurant, Dining Car, or Eating House: Dollar Exchange. Please furnish to (name of individual in charge of party) and other selected men en route to (name of camp or destination) one meal each not to exceed 60 cents per meal. This ticket not Up to the present time banks and bankers valid unless signed by representative of the Local Board. This ticket is good for days. in the following countries have been author- R. E. WOOD, Acting Quartermaster General. ized by the Federal Reserve Board to draw [Put Local Board stamp here.] By. drafts for the purpose of furnishing dollar (Representative of Local Board.) exchange: Argentina, Bolivia, Brazil, Chile, (Signature of person in charge of party to be signed in presence of Board's Colombia, Costa Rica, Ecuador, Nicaragua, representative.) I certify that - at has furnished meals to the Peru, Porto Rico, Santo Domingo, Uruguay, above on*this request, at - - cents each; total $ - Venezuela, and Trinidad. In this connection (In charge of party.) the following letter was sent out under date of I certify that - meals at - - cents, total $ , were furnished to the above party. August 20, in answer to an inquiry by a mem- (Party furnishing meals.) ber bank: Date used - This ticket is not assignable and when completely filled out should be indorsed on the back by the party furnishing the meals. It may then be Referring to your letter of August 19, you are correct in deposited for collection with any bank and will be paid by the Quartermaster General, Washington, D. C., or if preferred, the party furnishing your understanding that if the Board subsequently the meals may send this ticket direct to the Quartermaster General, increases the number of countries whose usages of trade Washington, D. C, for payment. require dollar acceptance facilities, member banks there- [BACK.] tofore given authority to accept such drafts may properly (Indorsement.) accept for those additional countries without further per- Pay to the order of - - (name of bank). mission from the Board, the Board of course reserving its (Signature of party furnishing meals.) right to revoke its approval as to any particular member bank or as to any country, it being understood that such [Indorsement by bank, stamps.] drafts comply with the provisions of the Federal Reserve (This is for use of paying quartermaster.) Act. Subvoucher No. to Voucher No. — . Abstract of disbursements at — . for , 19—.. Meal Tickets for Use by Drafted Men En Route INSTRUCTIONS. This meal ticket is issued by the United States War Department and to Camps. all hotels, restaurants, dining cars, and eating houses are enjoined to honor it. It is intended for the use of selected men traveling from the seat of their At the request of the acting Quartermaster Local Board to training camps, and when going to and from Medical Advisory Boards under orders from the Local Board. It should be pre- General of the United States Army, the Federal pared by inserting the name of the person in charge of the party and that person will sign the certificate for the meals at the bottom. The certifi- Reserve Board at its meeting on Friday, Sep- cate of the party furnishing the meals must be invariably obtained. One ticket will be prepared for each meal period (breakfast, dinner, or tember 6, 1918, voted that Federal Reserve supper) that will be necessary during the time in which the men are en route to camp or away from' their homes in attendance upon Medical Banks be instructed to request all member Advisory Boards. Only the original meal ticket will be delivo T,d to tho men going into banks to receive such meal tickets for collec- camp. The duplicate will be immediately mailed to the Quartermaster General, Washington, I). C, the triplicate remaining in the book for tion only, the tickets when so accepted to be future reference. forwarded through their respective correspond- The tickets are printed in triplicate, the ents for collection. original being in black, the duplicate in green, These tickets are issued to drafted men and and the triplicate in red. The original only is are for their use in procuring meals and lodging deposited for collection, the duplicate forwhile en route from local draft boards to camps warded by payee to the Quartermaster General, to which they are assigned, and read as follows: and the triplicate retained by payee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1, 191.8. FEDERAL RESERVE BULLETIN. 939 It is the desire of the Board that all member time not exceeding one year from date of acceptance; to banks accept these meal tickets and thus issue letters of credit authorizing the holder to draw drafts upon the corporation payable on demand or on time not render assistance to the War Department in exceeding one year from sale of letter of credit. facilitating the movement of troops. Subject to the approval of the Superintendent of Banks of the State of New York, the corporation may establish and conduct branch offices both within and outside the Establishment of an Acceptance Corporation. State of New York. The capital stock proposed will be $3,000,000, all com- Following is the prospectus and plan for the mon; divided into 30,000 shares of $100 par value each. formation of an organization committee to This stock will be offered for subscription at 110, and incorporate the Union Discount Corporation. will yield, when fully subscribed, $3,300,000. Of this sum 2 per cent, or so much of it as may be necessary, will The undertaking is the outgrowth of the probe used for preliminary expenses, to be expended under posal to finance the cotton crop by the use of the super vision of the board of directors; 8 per cent will the acceptance method which was discussed be set aside as a reserve fund; the balance, or $3,000,000, during June last and has since been under con- will be used for the purpose of creating banking credit sideration among trade authorities. The pros- for the business of the corporation. It is the purpose to distribute the capital stock as widely pectus briefly reviews the history of the enteras possible among banks, bankers, merchants, manufacprise and the reasons for believing that the use turers, and others whose business brings them into the of this method of financing is desirable and market as sellers or purchasers of acceptance paper. explains how it is intended to introduce the Plan of operation.—The primary object of the corporation new mode of dealing in acceptances: will be to buy, sell, and otherwise trade in acceptance paper arising out of transactions in cotton, cotton goods, Preamble.—On May 4, 1918, a general conference was and all other textiles. It is the purpose, however, to deal called and held under the auspices of the National Associa- in trade and bankers' acceptances covering transactions tion of Cotton Manufacturers at the Hotel Biltmore, New in all other commodities as well. York, at which were present prominent northern spinners, In general, the plan of operation of the corporation will southern shippers, bankers, and others interested in the be modeled after that so successfully followed for many cotton industry. years by the large British discount houses which have con- This conference resulted in the appointment of a com- tributed so much to the commercial supremacy of Great mittee of nine, composed of three northern spinners, three Britain and the prestige of the pound sterling. southern shippers, and three bankers, to report on better The principal office of the corporation will be located and more effective methods of financing cotton. in New York City. Agencies will be established, as On June 8,1918, at a further conference held at the Hotel occasion arises, in the large commercial and financial Biltmore for the purpose, this committee unanimously centers of the country. recommended that, in connection with present methods, Management.—The management of the corporation will bank and trade acceptances be employed, so far as prac- be placed in the hands of a board of directors, composed of ticable, by shippers and spinners in financing cotton. not less than 15 men. As a result of this report, the Union Discount Corpora- No payment against subscriptions will be called until tion is to be organized under the banking laws of the State 3,000 shares have been subscribed. There wall be no of New York for the purpose of dealing in both trade and promotion stock issued; every share of stock issued will bankers' domestic and foreign commercial acceptance represent cash at the rate of $110 per share. paper. ORGANIZATION COMMITTEE. Charter and capital.—The charter of the corporation will be sufficiently broad to cover all phases of commercial The National Association of Cotton Manufacturers now credit banking. desires to form an organization committee and from its Among other powers it will have power to discount bills members and others obtain subscriptions for the first of exchange, drafts, notes, acceptances or other choses in 3,000 shares of capital stock. These subscribers will be the action; to purchase and sell negotiable bonds or notes incorporators of the corporation. secured by deeds of trust or mortgages on real property SUBSCRIPTION AGREEMENT. wherever situated; to buy and sell notes and bills of exchange or other choses in action owned, issued, or other The undersigned, having read the foregoing prospectus choses in action; to accept drafts or bills of exchange drawn and plan for the formation of an organization committee upon it, negotiated, or guaranteed by it; to advance money to incorporate the Union Discount Corporation, and apon the security of bonds, notes, payable on demand or on proving the same, hereby agree to serve as a member of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

940 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. said committee, and to subscribe to the amount of the ruary 6, 1918, 5f per cent; February 13, 1918, capital stock of said corporation set opposite our respective o-J per cent; February 26, 1918, 6 per cent. names below, and agree to pay for the same under the The amounts issued during the different following specific conditions, namely: weeks varied, but at no time has the amount No subscriptions shall be due and payable until at least outstanding exceeded the figure of approxi- 3,000 shares of said capital stock shall have been subscribed, mately 8100,000,000, and recently the amount and the approval of the incorporation has been received outstanding has been substantially below from the Superintendent of Banks of the State of New $90,000,000. York. There has developed a substantial market for Of the amount so subscribed, 10 per cent shall be pay- the bills, and as the different series approached able when called by the chairman of the organization com- maturity they have been rediscounted at mittee, but not until at least the said 3,000 shares shall rates between 5| per cent and 4J per cent, have been subscribed. Said 10 per cent of said subscrip- depending upon the maturity. tion shall be expended under the direction of the said The issue of the bills by the British Governorganization committee. ment did not increase the outstanding debt of The balance (90 per cent) of said subscription shall be the United Kingdom of Great Britain and payable in three equal installments at 30. 60, and 90 day Ireland in this country, as the proceeds of all periods, when called by the chairman of the organization the bills were used to liquidate other obligacommittee after subscriptions shall have been obtained tions payable in this country and outstanding for the proposed 30,000 shares. at the time of issuance. British Treasury Bills. Foreign Exchange Problem. The FEDERAL RESERVE BULLETIN is able to Hon. R. C. Leffingwell, Assistant Secretary make the following statement about the issuof the Treasury, in testifying before the Comance in this country of British treasury bills, mittee on Ways and Means of the House of which have gradually become a well-known Representatives, on September 12, 1918, with feature of the short-term investment market: reference to a bill to supplement the second The first issue of these 90-day bills was dated Liberty Bond Act (printed elsewhere in this August 23, 1917. The bills were issued under issue of the BULLETIN, as enacted), made a authority of the act of Parliament of the statement concerning the foreign exchange sit- United Kingdom of Great Britain and Ireland uation, as follows: VI and VII, George V, c. 24, and the total issue authorized was $150,000,000. It was, Great Britain, France, Italy, and Canada are examples however, stated by the British financial agents of countries associated with us in tho war whoso currencies in this country at the time that the bills were in relation to the dollar suffered depreciation. Steps placed on sale that not over $ 15,000,000 bills taken to correct this depreciation have been comparatively would mature in any one calendar week. simple, consisting of the loan by the United States of dol- The first lot of $15,000,000 was offered on a lars to be emploj^ed by the borrowing country in the 5-J per cent basis and was immediately over- United States in support of its rate of exchange. Meassubscribed. Further lots of bills were put on ures to this effect have been in operation for over a year in sale each successive week at the same rate regard to Great Britain and France. Owing to various until September 18, 1917, when the basis was causes, it ha3 but recently been possible to take effective increased to 5-| per cent. The sales were dis- action in regard to Italian rates. continued during the Liberty loan campaign Assistance was extended to Canada through Great of last fall, but recommenced in November, Britain for the correction of the Canadian exchange. The and on the 20th of that month the rate was dislocation of business between Canada and the United made 6 per cent, which has been the ruling States, much of which is war business of the highest imrate since that time. The dates on which the portance, which was threatened through the fall in Canavarious discount rates on British treasury dian exchange, at one time seemed very serious. The bills were made effective are as follows: August following table shows the lowest rate, expressed in per- 23, 1917, 54 per cent; September 18, 1917, 5£ centage, at which these exchanges have sold as compared per cent; November 20, 1917, 6 per cent; Feb- with the rates at the present time: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. .FEDERAL EESERVE BULLETIN. 941 tina to stand to their credit with the Federal reserve Lowest rate of foreign bank of New York, the Argentine Government arranging currency (of the ex- Present rate. changes mentioned) for the payment in Argentina of the corresponding amount since August, 1914. of Argentine pesos at a discount of 3 per cent below the par of exchange, the discount representing the estimated Great Britain $4.50, or 7.53 per cent, §4.755, or 2.29 per cent, below par in Sep- below par. cost of the ultimate shipment of gold. tember, 1915. An arrangement similar to the Argentine arrangement France §0.1666 per franc, or SO. 1821, or 5.65 per cent, 14.72 per cent, below below par. but limited to $5,000,000, with an agreement looking to Italy $0. D 10 a 0 r 3 i n p e A r p li r r i a l, , o 1 r 9 1 3 6 4 . .37 S0.1570, or 18.65 per an extension to a total of §20,000.000 by mutual consent. per cent below par cent below par. of the two Governments, has been concluded with Bolivia. in May, 1918. Canada 23 per cent below par About If per cent be- An arrangement has just been concluded with Spain in July, 1918. low par. whereby a group of Spanish banks agree to open to a group of American banks credits amounting to 250,000.000 2. The countries in which the dollar has sold at a dis- pesetas. These credits will to a great extent be required count have been more difficult to deal with inasmuch as for Army purposes in Spain. Negotiation of this credit the power to correct the decline has not been in the hands carrying as it does information that the United States solely of the Secretary of the Treasury, and it has been Government will not be in the market as a purchaser of possible only so far as the Secretary of the Treasury has pesetas, has had a remarkably favorable effect on the rate been able to induce the countries in question or their for Spanish pesetas. banks to cooperate to that end by means of credits. The following, similar to statistical matter in the table I would like to say, in connection with that, that the under paragraph 1, shows the low price of the dollar and exchange problem is not of Treasury creation. Exchange the present market price in the country named: is a question of settling trade balances. Ordinarily balances are settled by exchange of goods. We have a bal- Country, India; par per United States dollar, 3.1 rupees; lowest rate of United States dollars of the exchange ance to settle only when our exports to a foreign country mentioned since August, 1914, 2.5 rupees per United are less than our imports from that foreign country. That States dollar September-October. 1917; United States situation has been created by the whole-hearted participa- dollar was below r>ar 19.42 per cent; present rate (Sept. 6), tion of the United States in the war, because the War 2.80 rupees per tjnited States dollar (stabilized rate on telegrapMc transfers); United. States dollar is 9.75 per Department, the War Industries Board, the Shipping cent below par. Board, and the War Trade Board said we can not ship the commoditites necessary to settle our neutral balances Below par because of the cost of the bullion plus the because we need those commodities to help Gen. Pershing, cost of shipping. as well as because of our loans to the allies. To the extent India ships vast amounts of jute and things which can we do not settle for the purchases in a foreign country in' not be gotten anywhere else, and we have little or nothing goods we have to settle for them in gold cr in credit. The to send there. Our exchange problem is the result of neutral-exchange problem existed even before the regu- our whole-hearted fighting of this war, and the Treasury lation of gold exports was determined upon, simply be- feels it has been very successful in dealing with the cause some of these countries did not want our gold. They situation. It has been the subject of careful study in the were experiencing what we had begun to experience before Treasury from the beginning. We are dealing with new we, entered the war—the evil results of a plethora of gold; conditions created by the war and must deal with them besides, exchange rates are affected by the cost oi* shipping cautiously and not allow ourselves to be hurried into gold, and that cost under war conditions is very groat; the I inconsidered action, but Secretary McAdoo and his insurance against risk is great. advisers were hard at work on the problem and feel now that very tangible results have been obtained. On the An arrangement was made in relation to Indian exchange other hand, experience in meeting the problem shows whereby unlimited credits for approved war needs of the that some further latitude will make it possible to operate United States were opened in India. At one time the more effectively in the future, and it is with that in mind condition of the exchanges between India and the United that this analysis is put before you. States had become so difficult that exchange on India was I have the figures for Argentina and Spain, showing in unprocurable. The present arrangement stabilizes the relation to the latter that the maximum discount was value of the rupee at a small premium, which premium is 35.11 per cent, and that the.discount now is 16.11 per cent, rendered necessary by the rise in the price of silver, .the which, in view of the fact that our efforts are by no means India circulating medium, consisting to a great extent of completed, is peculiarly gratifying: silver. It is highly inadvisable to permit shipments of gold to India because the precious metals that find their Argentina, par per United States dollar, 2.36 paper way to India disappear as in a morass and never reappear pesos; lowest rate of United States dollar since August, 1914, 2.1 paper pesos per United States dollar, December, in the circulation. 1917; United States dollar was below par 10.87 per cent; An arrangement was negotiated with Argentina whereby present rate (Sept. 6), 2.24 pesos per United States dollar. credits amounting to $100,000,000 were allowed by Argen- United States dollar is 4.94 per cent below par. 83463—18 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

942 FEDERAL RESERVE BULLETIN. OCTOBEK 1, 11)18. Spain, par per United States dollar, 5.18 pesetas; lowest covering India, China, Japan, the Philippines, and the rate"of United^ States dollar since August, 1914, 3.36 pesetas Malay Archipelago, also a branch in London, and a spread per United States dollar, April, 1918; United States dollar of branches and subbranches in Central America and the was below par 35.11 per cent; present rate (Sept. 6). 4.35 pesetas per United States dollar. United States dollar West Indies. The combined system has 40 banking is 16.11 per cent below par. houses abroad. The International Banking Corporation maintains a banking house at San Francisco, Cal. The 3. Arrangements with the Governments of Chile, Peru, National City Bank of New York has an office and a repreand Uruguay are at present in various stages of incomsentative in Copenhagen. pleteness. The organization of the National City Bank of New York 4. Arrangements have been made with the Government is a unique thing in international banking. There is no of Switzerland providing at the par of exchange for an other great international bank in the world with quite amount of Swiss currency sufficient for the needs up to the same unity, or homogeneity, of organization. This the present time of the American Expeditionary Forces. gives it distinct advantages in the effectiveness of its serv- Swiss exchange with the United States is at a rate where ice of banking and general commercial assistance to its the dollar is quoted at 13.72 per cent discount. This American and foreign customers. The foreign banking arrangement at the par of exchange is therefore effecting houses of the National City Bank of New York are Amerian important saving. can branch banks abroad by reason of their authorization In attempting to deal with these varied situations many under the Federal law of the United States. At the same difficulties are encountered. In almost all countries the time they are full functional local banks by reason of consent of the Government or the governmental bank is authorization under the laws of the countries where they required for transactions of such magnitude. Neutral are located. In either aspect, whether of foreign banking countries, especially whore they are in proximity to houses of the American bank or of local foreign banks con- Germany, often hesitate to undertake such transactions sidered above, they are all giving a complete service of with the Government of one of the belligerents. All banking, including the taking of deposits (both commercial kinds of objections and obstacles are met with, and it and savings in some places), extension of loans and disrequires the fullest powers to enable the Secretary to deal counts (or of permitted commercial overdrafts where that adequately with the various situations that present themcustom prevails), and these services are offered primarily selves. to the communities of local merchants, for whom they also conduct the foreign exchange transactions with every Foreign Business of the National City Bank of part of the world which the community's business call for. New York- It is necessary for the National City Bank's foreign banking houses to conduct these full functions, including In accordance with the policy already an- foreign exchange with any part of the world, and it also nounced in the issue of the BULLETIN for offers certain distinct advantages not only to the international organization of the bank but to American com- August, there is herewith presented an account merce for it to do so. of the foreign banking operations of another They are thus all complete local banks, but in another institution which has been engaged in the aspect they are to be regarded as banking houses of one development of American foreign trade—the great international bank; the personnel and the policies National City Bank of New York. As in of their organization are purposely kept homogeneous; former cases, the statement has been prepared they are not permitted to grow apart in the spirit of by the institution to which it relates. separatenoss they would necessarily feel if they were just foreign subsidiaries of some American institution. The American and foreign customers of the National City Bank PART I. of New York are thus all in one family, in a sense. The The National City Bank of New York, at this waiting, National City Bank of New York, in New York, or the has 17 foreign banking houses established under the Fed- National City Bank of New York in Buenos Aires, or the eral Reserve Law, 14 of them located in Latin America, 2 in banking house wherever located, is in reality all the one Russia, and 1 in Italy. For a full practical understanding bank. of the foreign banking extension of the bank, it is neces- . This is essentially a different system from that of the sary also to consider the branches throughout the world of typical foreign extension of European banking. The the International Banking Corporation, which the National typical British system has consisted of spreads of branch City Bank of New York controls through ownership of banks covering certain parts of the world, with a head practically all its stock and which is so closely affiliated office in London, most of the branch banks emphasizing with the National City Bank of New York as to enable exchange business. To-day the movement in England, the two organizations to work closely as parts of one bank- seen in the current amalgamations and expansion of bank ing system. The latter haB 15 branches in the Orient, capital there, is to have great "world systems" of British Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1, 1018. FEDERAL RESERVE BULLETIN. 943 Empire banks with branches all over England and spreads If official figures were available, they would show a comof branches over the rest of the world. parative standing of importance for the Habana, Mon- The National City Bank ox New York has devoted con- tevideo, and Genoa banking house of the National City siderable energy in foreign bank extension to the very Bank of New York. The most lately established foreign important work of systematizing credit information regard- banking houses have not all attained this rani:, of course. ing foreign merchants, etc., not alone as to its foreign The bank has adhered to the policy of accumulating at justomers, but including all the important firms in the its banking houses in different parts of the world sufficient countries where it has branches. In several foreign coun- stocks of commercial bills to enable it to have on hand at ties where it was not usual to obtain definite statistical all these points, at all times, ''dollar exchange" ready for tacts about a firm, such as are included in balance sheets, sale to United States exporters and importers. In this way the bank has been able to overcome the prejudice and get the bank is able to sell exchange at a much steadier rate, the information, along with other pertinent commercial from day to day, than if it had to go into the local markets data of great benefit to its customers. and bid for bills on a hand-to-mouth basis in order to meet In connection with all its own banking houses abroad, the demands of its customers. The fact that these stocks ana as far as is practicable with the International Banking are distributed at convenient points abroad gives an im- Corporation branches, the National City Bank of New portant advantage to American business and has enabled York conducts a foreign trade service for the interna- the bank to contribute with good effect to the building up tional benefit of its customers and of business in general. of ''dollar credits" in general international banking. By a special organization it has systematized the exchange and distribution of commercial information, some ARGENTINA. of it obtained as a by-product of regular banking, other The banking house of the National City Bank of New secured by special commercial representatives employed York at Buenos Aires was the first branch of a national especially for this business. This service is intended to bank opened abroad under the Federal Reserve law. It be of mutual benefit to United States and foreign custom- was established in November, 19M. Through this banking ers. The value of the service is increased by the inti- house the National City Bank of New York conducted the mate form of the international organization of the bank,! negotiations and the financing of the Argentine loan of 19.15 it consists not only of systematically handled credit and ; and subsequent international public financing that siggeneral information about firms individually, of reports nalized the expansion of United States banking into the on business conditions in general and the current situa- larger phases of its foreign activities. Through the medium tion in specific lines of trade, but also includes a large of this house, also, the Industrial Union of Argentina convolume of mail between the New York banking house ducted its notabio negotiations in .19.16 with United States and the hanking houses abroad relating to definite nego- | exporters for the settlement of a large number of claims tiation for goods and for business connections, in which due to commercial misunderstandings in the flood of early the bank acts as mutual friend and mediary only, getting war-time business between this country and Argentina. its international customers acquainted with each other, There is no phase of modern international banking which using its good offices in smoothing over misunderstandings, this banking house does not conduct as a part of its ordiundertaking no activities of buying or selling for its own nary routine. It has a large clientele of leading Argentine account. business houses as customers. The growth of its business Owing to the typical, relationships of the foreign bank- has made advisable a notable extension of the city bank ing houses of the National City Bank of New York in the system in Argentina to come in the near future. general international organization of !:he bank, it does BRAZIL. not seem necessary to describe the business of each, the capitalization devoted to it, etc. The publication of The representation of the National City Bank of New the Argentine Bank figures in the August issue of the York in Brazil consists of the large banking house in Rio de FEDERAL RESERVE BULLETIN" shows the deposits of the Janeiro and the banking houses at Sao Paulo, Santos, and Buenos Aires banking house to have been $20,420,300 Bahia, the Rio branch having a position of authority in (roughly converted from Argentine pesos) in April. At the group, but all doing the complete business, with full the first of the year the banking house at Rio de Janeiro power to negotiate and close business transactions, which stood sixth among the leading native and foreign banks is characteristic of the international organization. there, having resources of 136,860 contos, the other bank Through these banking houses the National City Bank of totals being Banco do Brazil. 556,855 contos; London and New York has assumed an important position in the local Brazilian Bank, 192,444 contos; Banco Mercantil do Rio business situation in this part of Brazil, and has estabde Janeiro, 158,627 contos; Banco Nacional Ultramarino, lished cordial relations with governmental authorities and 138,957 contos; London and River Plate Bank, 137,447 agencies. Current developments forecast an early extencontos. The banking houses at Sao Paulo, Brazil, stood sion of the Brazilian group into other important commerfifth among the institutions of Sao Paulo and Santos. cial territories of the great Republic. Subject to war- There is also a National City banking house at Santos. time governmental control, and the limitations of law, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

944 FEDEKAL RESERVE BULLETIN. OCTOBEB 1, 1918. the Brazilian banking houses of the National City Bank of extension of its facilities, working closely with the spread New York are doing a large volume of banking in all its of branches of the International Banking Corporation here, phases in commercial financing of business between the may be looked for. United States and Brazil, and of Brazil's own commerce ITALY. with all the world. The banking house of the National City Bank of New URUGUAY. York in Genoa, Italy, is an imposing structure in that The banking house at Montevideo occupies a position important center of Italian industry and commerce. of influence among the foreign institutions there, and is Its sphere of banking influence extends all through the worldng closely with the local banking system of the Lombardy region, where it. lias made important conneccountry in conducting every phase of financing which the tions with clients whose business will include activities National City Bank of New York handles. When the in Italo-American after-war commerce. Effective relaheavy balances of merchandise trade between the "River tionships with the local Italian banking system have been Plate markets and us and the nations associated with us in built up also. This banking house lias been one of the the war turned exchange rates adversely to the dollar, mediums for a large volume of exchange transactions conthis banking house and the Buenos Aires banking house ducted by the bank between Italy and America since went as far as they could safely and legitimately go as the early stages of the war. purely commercial banks, through liberal credit transactions accorded to American business, in ameliorating the SCANDINAVIA. disadvantages of the situation; and since the United The National City Bank of New York has an office at States Government, through establishment of large credits Copenhagen, where its Scandinavian representative makes on Government account in the Government institutions his headquarters. Through the medium of the strongest there, and negotiation of arrangements by which our banks of Norway, Sweden, and Denmark, with which, the Federal Reserve banks sell, exchange, and settle the bank has particularly close relationships, this office is able accounts of our importers without necessity of shipping to offer American business interests complete banking gold, the banking houses of the National City Bank of facilities connected with exchange, establishment of for- New York have continued to cooperate in a way to assist eign credits, also commercial information for purposes of in this important service to our commerce in the abnormal promotion of commerce. situation, CHILE. RUSSIA. In 1916 the banking house at Valparaiso, Chile, was A branch of the National City Bank of New York was organized and opened for business. The bank has just opened in Petrograd on January 15, 1917, and up to the opened a subordinate office in Santiago, which will later time of the Bolshevik revolution last November this probably carry on full functional banking locally, although branch was doing a large and rapidly increasing business it now does practically a full business by means of the with both Americans and Russians. A branch of the Valparaiso facilities. The Chilean representation has not bank was opened in Moscow on November 28, but due to only conducted full local and international activities, but the unsettled political situation tho opening of this latter the Valparaiso banking house did pioneer work in the branch was of a very informal character. present very important monetary development in Chile, In the latter part of December all private banks in importing gold for the purpose. Russia, including our branches, were seized by the Soviet | Government, who thereupon instituted a process of THE WEST INDIES AND CARIBBEAN. nationalizing the banks by making them branches of the Sfcat-e bank. Our branches were excepted from this Two years ago the National City Bank of New York process, but at the same time their business was greatly concluded an arrangement with the stockholders of the restricted, being put under the general banking regulations Bank of Habana by which that important bank in Cuba of the other Russian banks. was absorbed in the National City Bank of New York and became the Kabana banking house of the latter. A sub- PART II. ordinate, but completely equipped and full-functioned, banking house was a little later opened at Santiago de The International Banking Corporation is the pioneer Cuba. This year a new banking house was organized and American bank to organize and operate a system of foreign began business at San Juan, Porto Rico. For nearly a branches. For nearly 17 years it has been specializing year a banking house has been fully organized and doing in the finance of American trade with Asia, particularly the National City Bank's full banking activities at Ca- China and the Philippines. racas, Venezuela. The importance of this region of Latin The first foreign agent of the corporation was appointed America to United States business interests is fully recog- in Shanghai early in January, 1902, for the purpose of nized by the National City Bank of New York, and further assisting the United States Government in the collection Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBBB 1, 1918. FEDERAL BESERVE BULLETIN. 945 of the Chinese Boxer indemnity. Since that date various silver in cover of branch purchases of American bills of branches have been opened until now the corporation exchange, to grant credits to American and foreign firms, controls 24 branches in 10 different countries. to authorize credits at branches and generally to supervise The corporation derives its powers from a special charter the operations carried on in the various countries. The granted by the General Assembly of the State of Con- London office acts as the clearing agency for the sterling necticut , approved June 14, 1901. Its formation was the and European transactions of the branches. outcome of the widespread interest in oriental trade which was aroused by the United States obtaining control of CHINA. the Philippines. The capital at first paid in (December, The parent bank branch for North China is situated in 1901) was $500,000. This capital has subsequently been Shanghai. Under its immediate supervision are the increased until at present it is $3,250,000, with a surplus branches in Hankow, Tientsin, and Peking. The Shangof $3,250,000 and undivided profits of $2,118,000. hai office was opened for business on May ]5, 1902. The Recently, with the approval of the Federal Reserve Peking, Hankow, and Tientsin offices were opened a few Board, practically all the stock has passed to the National years later, the first with the distinct purpose of being of City Bank of New York, under the act of Congress author- assistance to the American group which had just become izing such investments by national banks. The directors interested in the Chinese reorganization or six power loan. of the corporation are now in the main officials of the Na- The corporation has subsequently acted as the financial tional City Bank. Since 1915. with the powerful support agent of the American group in China. The staff of the of the National City Bank, the business of the corporation north China branches now numbers 131. has rapidly expanded until on June 30, 1918, the total In Shanghai is centered a large part of the import and resources of the institution were in excess of §100,000,000. export trade of China. The principal exports are raw It has been demonstrated by the experience of the Inter- silk, cotton, yarn, and tea. The foreign business houses national Banking Corporation that a banking machine, which handle tthis vast trade are located not in the native however perfect, without very large resources can make city but in the foreign settlements, where they are outside little impression on a foreign trade amounting to hundreds of the jurisdiction of the Government of China. The of millions of dollars annually. At the same time large International Banking Corporation occupies a large buildbanking power not coordinated with long experience in ing in the center of the business section. Shanghai, bethe intricacies of the eastern exchanges and with a ripe cause of this grouping of foreign firms, through which the knowledge of the customs and banking practices of orien- bulk of the foreign trade of China is handled, is an intertal peoples is ineffective. The application under Gov- national port rather than a Chinese port and the business ernment sanction, therefore, of National City Bank power generally has an international aspect. There are many to the International Banking Corporation machine should important firms which have had their establishments in produce increasing benefits for American business. It China for a generation or more and these firms compete marks a long step forward in the finance of American actively for business of all kinds regardless of the country import and export trad® with China and other eastern from which the goods in question are to come or go. The countries. more important firms represent in particular a long list of The system of branches now in operation extends to the British and American concerns who are exporters of following cities: Yokohama and Kobe, the two principal manufactured articles to China. "With their large reports of Japan; Shanghai, Hankow, and Tientsin, the most sources they arrange, to purchase China products in the important ports of North China; Peking, the capital and interior from season to season and to export them to center of political activity; Hongkong, the chief port for various countries. Russian business, French business, the trade of south China, and Canton, on the Chinese British business, Chinese business, and American busimainland; Manila and Cebu, the principal cities of the ness is keenly competed for by both firms and banks re- Philippines; Singapore, the capital and trade center of the gardless of nationality. In recent years Japanese firms Straits Settlements; Batavia and Surabaya, the leading and banks have become increasingly important factors. ports of Java, in the Dutch East Indies; Calcutta and There are now 12 foreign banks, including the Inter- Bombay, the financial centers of British India, the one on national Banking Corporation, in Shanghai offering facilthe eastern and the other on the western side of the penin- ities to merchants of all countries interested either in sula; and London, England. In addition, the corporation placing their manufactured products with the Chinese or maintains two branches in Panama, one in the Republic of in the purchase of raw materials in China. Colombia, and four on the Island of Santo Domingo. An Hankow and Tientsin are much like Shanghai, except agency in San Francisco completes the chain. that they are on a somewhat smaller scale. Europeans and The business of the corporation very largely consists of Americans reside and do their business within the settlethe financing at its branches of the export and import ments. Hankow, situated 600 miles up Yangtze River, is trade centering at that given point The function of the the great interior trading post of China. It is known head office in New York is to provide financial facilities, especially as the tea center, although from it is shipped a to purchase export bills, to make shipments of gold and large amount of raw cotton, hides, wood oil, and oil seeds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

946 FEDERAL RESERVE BULLETIN. OCTOBER 1, .1918. Near Hankow are situated important iron works now con- | to the need of American trade which has arisen since the trolled by the Japanese. It is expected that some day war through the direct shipment of Java's products to this Hankow will be the railway center of China. At present country as against the former practice of consigning them it is the terminus of a line which runs to Peking and which to Holland for resale. The staffs of the two offices already also connects with the Manchurian railways and the j number 21. The Batavia manager is of Dutch nationality Trans-Siberian. Tientsin, which is only a few hours away with long experience in the east and London. The prinby rail from Peking, is much more of a business center cipal exports are petroleum, coffee, copra, sugar, tea, tin, than the capital itself. From it are shipped large quanti- j and tobacco. Imports come chiefly from Holland, alties of wool, hides and skins, bristles, straw braid, and pre- though those from America have recently shown an enserved eggs. couraging increase. A large trade is done with the Straits Hongkong is a British colony. It is situated principally Settlements and British India. on an island and its harbor is one of the finest in the world. An immense business is carried on here as in BRITISH INDIA. Shanghai. Similarly, there are important manufacturing The Indian branches of the corporation are at Calcutta industries, cotton mills, sugar refineries, cement works, and Bombay. The staffs of the two offices number 125, rope, glass, and ice factories. The trade of the port is which gives an idea of the magnitude of the business translargely in cotton goods, sugar, flour, and metals. acted and the extent of the facilities which are at the dis- Canton, the greatest city of south China, is only four or posal of American merchants interested in trade with five hours (112 miles) by train from Hongkong and is an British India. India is more than a country. It is in overnight run by boat. The net value of its trade in 1916 every sense an empire. Its problems, political, trade, was Haikwan taels 108,000,000. The business of the cor- financial, and exchange, are quite foreign to those of China poration's Canton branch largely consists of loans and ex- and other eastern countries, and banks operating there change operations against silk, tea, cotton, rattans, and require specially trained staffs. The corporation fortuother commodities. The Hongkong and Canton staff i nately has been able to be of material assistance in financing numbers 74. j the shipment to this country of large quantities of Indian PHILIPPINE ISLANDS. products essential to the prosecution of the war, chief Manila is approximately two days distant from Hong- among which have been jute, gunny bags, hides, and kong by steamer. The office of the corporation here in con- J skins. India is also a country where import cover for junction with the branch at Cebu, located on one of the j purchases of exchange against exports is not readily secured southern islands, finances not only an important import and necessitates the employment of staffs familiar not only trade from the United States in various commodities, but j with local practices but who are capable of rapidly taking also large exports of hemp, copra, sugar, tobacco, and j advantage of exchange situations arising in the Dutch cocoanut oil. For many years the corporation, with two iEast Indies, the Straits Settlements, Hongkong, Shanghai, or three other banks, acted as depositary of Philippine jand Japan. That such a large American organization Government funds. These funds are now lodged with the exists to-day and has not yet to be created through long Government bank. The Philippine staff numbers 74. painful years of experience is of great importance to American foreign-trade interests. STRAITS SETTLEMENTS. The corporation's branch in the Straits Settlements is JAPAN. located at Singapore. Its principal activities are in con- The Japan branches of the corporation are situated in nection with the purchase of exchange covering exports of Yokohama and Kobe, the former the chief port for the tin and rubber in which there is a vast trade. The im- exportation of Japan's principal product, silk, and the ports and exports of the colony in 1916 totaled 3600,000,000. latter the chi-jf port for the importation of cotton and other The currency of the colony is the Straits dollar, worth materials entering into the manufactures of the country. about 56 cents. The problem of securing exchange cover Although, the Japanese banks have offices in this country, against purchases is a difficult one. Competition between American merchants, for the most part, prefer to pass their the nine British, French, Japanese, Dutch and American business through an American organization. It is fortubanks represented in Singapore is exceptionally severe. nate, therefore, that the facilities of such a complete organ- Nearly ail the important trading firms are British. The ization are at their disposal. The staff in the two offices staff of the branch numbers 20. The manager has spent numbers 74. Relations of close friendship exist between many years in the Straits and has an experience which the corporation and the Japanese banks, whose managers should be of value to American merchants, especially are keen business men and ready to help in every way in those interested in the products of the colony. j the development of trade between our two countries. DUTCH EAST INDIES. PANAMA. The Dutch East Indies branches of the corporation at The Panama branches of the corporation are situated in Bata via and Soerabaya on the island of Java are of more the cities of Panama and Colon. They were established a recent organization. They were established in response j number of years ago for the purpose of affording banking Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 947 facilities to Americans employed in connection with the 111. R. 112*3.] construction of the canal, and now are of special utility as AN ACT To amend and reonact sections four, eleven, Fixtccn, nineteen, respects the payment of canal tolls by vessels of all nations. and twenty-two of the act approveu December twenty-third, nineteen hundred and thirteen, and known as the Federal'Reserve Act, A considerable commercial business is also done. and sections fifty-two hundred and ei£?ht and fifty-two hundred and nine, Revised Statutes. COLOMBIA. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That A branch was established in Medellin, Department of section four of the act approved December twenty-third, Antioquia, in 1916. At this branch a commercial and nineteen hundred and thirteen, known as the federal exchange business is transacted. Owing to the difficulties Reserve Act, be amended and rcenacted by striking out that part of such section which reads as follows: of transportation and communication, however, the oper- "Directors of class A and class B shall be chosen in the ations of this branch are more or less of a local character |following manner: unrelated to business in other cities of the Republic, such 4'The chairman of the board of directors of the Federal as Bogota, the capital. Reserve Bank of the district in which the bank is situated or, pending the appointment of such chairman, the organization committee shall classify the member banks of DOMINICAN REPUBLIC. the district into three general groups or divisions. Each The corporation in 1917 purchased the private banking group shall contain as nearly as may be one-third of the aggregate number of the member banks of the district, business in Santo Domingo of Mr. S. Michelena. With and shall consist, a,| nearly as may be, of banks of similar the principal office in Santo Domingo City, there are capitalization. The groups shall be designated by numbranches in the cities of San Pedro de Macoris, Puerto ber by the chairman. Plata, and Santiago. Mr. Michelena, who remains with "At a regularly called meeting of the board of directors of each member bank in the district it shall elect by ballot the corporation as one of its managers, has lived in Santo a district reserve elector and shall certify his name to the Domingo for 25 years. With his long experience as the chairman of the board of directors of the Federal Reserve leading private banker, the Santo Domingo offices of the Bank of the district. The chairman shall make lists of the corporation are enabled' to do much in connection with, district reserve electors thus named by banks in each of the aforesaid three groups and shall transmit one list to each the finance of growing Dominican crops, the chief of which elector in each group. are sugar, tobacco, and cacao. The several branches also "Each member bank shall be permitted to nominate to afford every facility in connection with the import and i the chairman one candidate for director of class A and export trade of the country. one candidate for director of Class B. The candidates so nominated shall be listed by the chairman, indicating by whom nominated, and a copy of said list shall, within GREAT BRITAIN. fifteen, days after its completion, be furnished by the chairman to each elector. The London office of the corporation was opened on "Every director shall, within fifteen days after the re- April 15, 1902. It is located at 36 Bishopsgate, E. C, ceipt of the said list, certify to the chairman his first, and forms an important part of the banking mechanism second, and other choices of a director of class A. and of the corporation. Through it pass all the sterling bills class B, respectively, upon a preferential ballot, on a purchased by the head office and various branches, and by form furnished by the chairman of the board of directors of the Federal Reserve Bank of the district. Each elector it are made all financial arrangements in connection with shall make a cross opposite the name of the first, second, their discount or collection. The London office also and other choices for a director of class A and for a director keeps in close touch with the silver markets, upon which of class B, but shall not vote more than one choice for any depend to a large extent fluctuations in the Eastern ex- one candidate," and by substituting therefor the following: "Directors of class"A and class B shall be chosen in changes. At the same time it keeps branches informed j the following manner: regarding the trend of money discounts. It is likewise a "The Federal Reserve Board shall classify the in ember source of a vast amount of credit information regarding banks of the district into three general groups or divisions, European firms engaged in foreign trade the world over. ' designating each group by nitmher. Each group shall consist as nearly as may be of banks of similar capitalization. It is at present the designated depositary of the War, ; Each member bank shall be permitted to nominate to the Navy, and State Departments of the United States Gov- \chairman of the board of directors of the Federal Reserve eminent. It is in a position to take care of the require- Bank of the district one candidate for director of class A ments of American firms having offices in or transacting and one candidate for director of class B. The candidates so nominated shall be listed by the chairman, indicating by busiri.es with the United Kingdom. whom nominated, and a copy of said list shall, within fifteen days after its completion, be furnished by the chairman to each member bank. Each member bank by a resolution of the board or by an amendment to its by-laws Amendments to the Federal Reserve Act. shall authorize its president, cashier, or some other officer to cast the vote of the member bank in the elections of The bill embodying amendments to the class A and class B directors. Federal Reserve Act was signed by the Presi- "Within fifteen days after receipt of the list of candidates the duly authorized officer of a member bank shall dent on September 26. The text of the bill certify to the chairman his first, second, and other choices follows: for director of class A and class B, respectively, upon a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

948 FEDERAL KESEEVE BULLETIN". OCTOBER 1,1918. preferential ballot upon a form furnished by the chairman "'National banks shall have power to execute such of the board of directors of the Federal Reserve Bank of the bond when so required by the laws of the State. district. Each such officer shall make a cross opposite "In any case in which "the laws of a State require that the name of the first, second, and other choices for a di- a corporation acting as trustee, executor, administrator, rector of class A and for a director of class B, but shall not or in any capacity specified in this section shall take an vote more than one choice for any one candidate. No oath or make an affidavit, the president, vice president, ofncer or director of a member bank shall be eligible to cashier, or trust officer of such national bank may take the serve as a class A director unless nominated and elected necessary oath or execute the necessary affidavit. by banks which are members of the same group as the ^ "It shall be unlawful for any national banking associamember bank of which he is an officer or director. tion to lend any officer, director, or employee any funds Any person who is an oflicer or director of more than held in trust under the powers conferred by this section. one member bank shall not be eligible for nomination as a Any officer, director, or employee making such loan, or to class A director except by banks in the same group as the whom such loan is made, may be fined not more than bank having.the largest aggregate resources of any of those §5,000, or imprisoned not more than live years, or may be of which such person is an oflicer or director. both fined and imprisoned, in the discretion of the court. SEC. 2. That section eleven (k) of the Federal Reserve "In passing upon applications for permission to exer- Act be amended and reenacted to read as follows: cise the powers enumerated in this subsection, the Federal " (k) To grant by special permit to national banks ap- Reserve Board may take into consideration the amount plying therefor, when not in contravention o| State or of capital and surplus of the applying bank, whether or local law, the right to act as trustee, executor, adminis- not such capital and surplus is sufficient under the circumtrator, registrar of stocks and bonds, guardian of estates, stances of the case, the needs of the community to be assignee, receiver, committee of estates of lunatics, or in served, and any other facts and circumstances that seem, any other fiduciary capacity in which!1 State banks, trust to it proper, and may grant or refuse the application companies, or other corporations which come into compe- accordingly: Provided, That no permit shall be issued to tition with national banks are permitted to act under the any national banking association having a capital and surlaws of the State in which the national bank is located. plus less than the capital and surplus required by State "Whenever the laws of such State authorize or permit law of a State banks, trust companies, and corporations the exercise of any or all of the foregoing powers by State exercising such powers." banks, trust companies, or other corporations which com- SEC. 3. That the ninth paragraph of section sixteen of pete with national banks, the granting to and the exercise the Federal Reserve Act, as amended by the acts approved of such powers by national banks shall not be deemed to September seventh, nineteen hundred and sixteen, and be in contravention of State or local law within the mean- June twenty-first, nineteen hundred and seventeen, be ing of this act. further amended and reenacted so as to read as follows: "National banks exercising any or ail of the powers "In. order to furnish suitable notes for circulation as enumerated in this subsection shall segregate all assets Federal reserve notes, the Comptroller of the Currency held in any fiduciary capacity from the general assets of shall, under the direction of the Secretary of the Treasury, the bank arid shall keep a separate set of books and records cause plates and dies to be engraved in the best manner to showing in proper detail all transactions engaged in under guard against counterfeits and fraudulent alterations, and authorty of this subsection. Such books and records shall shall have printed therefrom and numbered such quanbe open to inspection by the State authorities to the same tities of such notes of the denominations of $5, §10, 820. extent as the books and records of corporations organized $50, $100, S500, $1,000, $5,000, $10,000 as may be required under State law which exercise fiduciary powers, but to supply the Federal Reserve Banks. Such notes shall nothing in this act shall be construed as authorizing the be in form and tenor as directed by the Secretary of the State authorities to examine the books, records, and assets Treasury under the provisions of this act and shall bear of the national bank which are not held in trust under the distinctive numbers of the several Federal Reserve authority of this subsection. Banks through which they are issued." "No national bank shall receive in its trust department SEC. 4. That paragraphs (b) and (c) of section ninedeposits of current funds subject to check or the deposit of teen of the Federal reserve Act, as amended by the acts checks, drafts, bills of exchange., or other items for col- approved August fifteenth, nineteen hundred and fourlection or exchange purposes. Funds deposited or held teen, and June twenty-first, nineteen hundred and sevenia trust by the bank awaiting investment shall be carried teen, be further amended and reenacted to read as follows: in a separate account and shall not be used by the bank in "(b) If in a reserve city, as now or hereafter defined, the conduct of its business unless it shall first set aside in it shall hold and maintain with the Federal \ eserve Bank the trust department United States bonds or other securi- of its district an actual net balance equal to not less than ties approved by the Federal Reserve Board. ten per centum of the aggregate amount of its demand "In the event of the failure of such bank the owners of deposits and three i>er centum of its time deposits: Prothe funds held in trust for investment shall have a lien on vided, however, That if located in the outlying districts of a the bonds or other securities so set apart in addition to reserve city or in territory added to such a city by the their claim against the estate of the bank. extension of its corporate charter, it may, upon the affirma- "Whenever the laws of a State require corporations tive vote of five members of the Federal "reserve Board, acting in a fiduciary capacity to deposit securities with hold and maintain the reserve balances specified in parathe State authorities for the protection of private or court graph (a) hereof. trusts, national banks so acting shall be required to make "(c) If in a central reserve city, as now or hereafter similar deposits and securities so deposited shall be held defined, it shall hold and maintain with the Federal Kefor the protection of private or court trusts, as provided by serve Bank of its district an actual net balance equal to the State lav/. not less than thirteen per centum of the aggregate amount "National banks in such cases shall not be required to of its demand deposits and three j>er centum of its time execute the bond usually required of individuals if State deposits: Provided,, however. That if located in the outcorporations under similar circumstances are exempt from lying districts of a central reserve city or in territory this requirement. added to such city by the extension of its corporate charter, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1, 1918. FEDSKAL RESERVE BULLETIN. 949 it may, upon the affirmative vote of five members of the "Any member bank may sell securities or other prop- Federal I'eserve Board, hold and maintain the reserve erty to any of its directors, or to a firm of which any of its balances specified in paragraphs (a) or (b) thereof." directors is a member, in the regular course of business on SEC. 5. That section twenty-two of the Federal Peserve terms not more favorable to such director or firm than those act, as amended by the act of June twenty-first, nineteen offered to others, or when such sale is authorized by a hundred and seventeen, be further amended and re- majority of the board of directors of a member bank to be enacted to read as follows: evidenced by their affirmative vote or written assent: Pro- "(a) No member bank and no officer, director, or em- vided, however, That nothing in this subsection contained ployee thereof shall hereafter make any loan or grant any shall be construed as authorizing member banks to purgratuity /to any bank examiner. Any bark officer, direc- chased sell securities or other property which such banks tor, or employee violating this provision shall be deemed are not otherwise authorized by law to purchase or sell. guilty of a misdemeanor and shall be imprisoned not ex- " (e) No member bank shall pay to any director, officer, ceeding one year or fined not more than So,000, or both, attorney, or employee a greater rate of interest on the deand may be fined a further sum equal to the money so posits of such director, officer, attorney, or employee than loaned or gratuity given. that paid to other depositors on similar deposits with such "Any examiner accepting a loan or gratuity from any member bank. bank examined by him or from an officer, director, or " (f) If the directors or officers of any member bank shall employee thereof, shall be deemed guilty of a misde- knowingly violate or permit any of the agents, officers, or meanor and shall be imprisoned one year or fined not more directors of any member bank to vi olate any of the provisthan 85,000, or both, and may be fined a further sum equal ions of this section or regulations of the board made"under to the money so loaned or gratuity given., and shall forever authority thereof, every director and officer participating thereafter be disqualified from holding office as a national in or assenting to such violation shall be held liable in his bank examiner. personal and individual capacity for ail damages which "(b) No national bank examiner shall perform any the member bank, its shareholders, or any other persons other service for compensation while holding such office shall have sustained in consequence of such violation.'' for any bank or officer, director, or employee thereof. SEC. 7. That section fifty-two hundred and eight of the "No examiner, public or private, shall disclose the . Revised Statutes as amended by the act of July twelfth, names of borrowers or the collateral for loans of a member; eighteen hundred and eighty-two, and section fifty-two bank to other than the proper officers of such bank without I hundred and nine of the Revised Statutes as amended by first having obtained the express permission in writing | the acts of April sixth, eighteen hundred and sixty-nine, from the Comptroller of the Currency, or from the board of| and July eighth, eighteen hundred and seventy, be, and directors of such, bank, except when ordered to do so by a! the same are hereby, amended and reenacted to read as court of competent jurisdiction, or by direction of the|, follows: Congress of the United States, or of either House thereof,I "SEC. 5208. It shall be unlawful for any officer, director, or any committee of Congress or of either House duly| agent, or employee of any Federal Reserve Bank, or of any authorized. Any bank examiner violating the provisions | member bank as defined in the act of December twentvof this subsection shall be imprisoned not more than one | third, nineteen hundred and thirteen, known as the Fedyear or fined not more than S5,000, or both. ! eral Reserve Act, to certify any check drawn upon such "(c) Except as herein provided, any officer, director, | Federal Reserve Bank or member bank unless the person, employee, or attorney of a member bank who stipulates forj firm, or corporation drawing the check has on deposit with or receives or consents or agrees to receive any fee, commis-| such Federal Reserve Bank or member bank, at the times sion, gift, or thing of value from any person, firm, or corpo-! such check is certified, an amount of money not less than ration for procuring or endeavoring to procure for such per- the amount specified in such check. Any check so certison, firm, or corporation, or for any other person, firm, or fied by a duly authorized officer, director, agent, or emcorporation, any loan from or the purchase or discount of ployee shall be a good and valid obligation against such any paper, note, draft, check, or bill of exchange by such Federal Reserve Bank or member bank; but the act of any member bank shall bo deemed guilty of a misdemeanor officer, director, agent, or employyee of any such Federal and shall be imprisoned not more than one year or fined not Reserve Bank or member bank in violation of this section more than So,000, or both. shall, in the discretion of the Federal Reserve Board, sub- "(d) Any .member bank may contract for, or purchase ject such Federal Reserve Bank to the penalties imposed from, any of its directors or from any firm, of which any of by section eleven, subsection (h), of the Federal Reserve its directors is a member, any securities or other property, Act, and shall subject such member bank if a national bank to 1he liabilities and proceedings on the part of the when (and not otherwise) such purchase is made in the Comptroller of the Currency provided for in section fiftyregular course of business upon terms not less favorable to two hundred and thirty-lour, Revised Statutes, and shall, the bank than those offered to others, or when such purin the discretion of the Federal Reserve Board, subject chase is authorized by a majority of the board of directors any other member bank to the penalties imposed by secnot interested in the sale of such securities or property, tion nine of said Federal Reserve Act for the violation of such authority to be evidenced by the affirmative vote or any of the provisions ol said act. Any officer, director, written assent of such directors: Provided, however, That agent, or employee of any Federal Reserve Bank or memwhen any director, or firm of which any director is a member bank who shall willfully violate the provisions of this ber, acting for or on behalf of others, sells securities or other section, or who shall resort to any device, or receive any property to a member bank, the Federal Reserve Board fictitious obligation, directly or collaterally, in order to by regulation may, in any or all cases, require a full disevade the provisions thereof, or who shall certify a check closure to be made, on forms to be prescribed by it, of all before the amount thereof shall have been regularly commissions or other considerations received, and whenentered to the credit of the drawer upon the books of the ever such director or firm, acting in his or its own behalf, bank, shall be deemed guilty of a misdemeanor and shall, sells securities or other property to the bank the Federal on conviction thereof in any district court of the United Reserve Board, by regulation, may require a full dis- States, be fined not more than §5,000, or shall be imclosure of all profits realized from such sale. 83463—18- 5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

950 FEDERAL RESERVE BULLETIN. OCTOBKK 1, 1918. prisoned for not more than five years, or both, in the old of either sex. It will also make loans on corresponddiscretion of the court. ing classes of sheep and goats. "SEC. 5209. Any officer, director, agent, or employee Its object in making advances on stock cattle is to preof any Federal ReserveJBank, or of any member bank as serve breeding herds, so that an adequate supply of meat defined in the act of December twenty-third, nineteen may be assured for the future. As the breeding herds in hundred and thirteen, known as the Federal Reserve Act, greatest danger are those in the drought-stricken district who embezzles, abstracts, or willfully misapplies any of in the Southwest, it was thought that prompt and adethe moneys, funds, or credits of such Federal Reserve Bank quate relief may be given by encouraging cattlemen in or member bank, or who, without authority from the localities where conditions are good, to buy stock cattle directors of such Federal Reserve Bank or member bank, in the drought-stricken area and move them to other issues or puts in circulation any of the notes of such Fed- localities where they have adequate range, water, and eral reserve bank or member bank, or who, without such feed, and proper facilities for taking care of them. ££j authority, issues or puts forth any certificate of deposit, To aid in accomplishing this result, and to supplement draws any order or bill of exchange, makes any acceptance, the facilities of banks and cattle loan companies the War assigns any note, bond, draft, bill of exchange, mortgage, Finance Corporation has created cattle loan agencies in judgment, or decree, or who makes any false entry in any Kansas City, Mo., and Dallas, Tex., through which it book, report, or statement of such Federal Reserve Bank or will make loans, in proper cases, preferably to banks and member bank, with intent in any case to injure or defraud bankers under section 7, and in exceptional cases to cattle such Federal Reserve Bank or member bank, or any other loan companies under section 9 and direct to the owners company, body politic or corporate, or any individual per- of stock cattle. son, or to deceive any officer of such Federal Reserve Bank If a stock raiser has been unable to procure a loan from or member bank, or the Comptroller of the Currency, or his bank or cattle loan company, and can give ample any agent or examiner appointed to examine the affairs of security for the amount needed, he should apply to the such Federal Reserve Bank or member bank, or the Fed- cattle foan agency of the War Finance Corporation, either eral Reserve Board; and every receiver of a national bank- at Kansas City, Mo., or Dallas, Tex. ing association who, with like intent to defraud or injure, Applicants residing in, or whose principal place of embezzles, abstracts, purloins, or willfully misapplies any business is in the Atlanta, Dallas, or Richmond Federal of the moneys, funds, or assets of his trust, and every per- Reserve districts should make application to the cattle son who, with like intent, aids or abets any officer, director, loan agency of the War Finance Corporation at Dallas, agent, employee, or receiver in any violation of this sec- Tex. Those residing in, or whose principal place o tion shall be deemed guilty of a misdemeanor, and upon business is in Kansas City, St. Louis, San Francisco, and conviction thereof in any district court of the United Minneapolis Federal Reserve districts should make States shall be fined not more than $5,000 or shall be application to the cattle loan agency of the War Finance imprisoned for not more than five years, or both, in the Corporation at Kansas City, Mo. Those residing in, or discretion of the court. whose principal place of business is in the Chicago, Cleve- 14Any Federal Reserve Agent, or any agent or employee land, Philadelphia, New York, and Boston Federal of such Federal Reserve Agent, or of the Federal Reserve Reserve districts should apply direct to the War Finance Board, who embezzles, abstracts, or willfully misapplies Corporation, Washington, D. 0. any moneys, funds, or securities intrusted to his care, or The security offered for all cattle loans must be worth without complying with or in violation of the provisions at least 25 per cent more than the amount borrowed, and of the Federal Reserve Act, issues or puts in circulation any the borrower must agree to give additional security at Federal Reserve notes shall be guilty of a misdemeanor any time upon demand of the War Finance Corporation. and upon conviction in any district court of the United States shall be fined not more than $5,000 or imprisoned for not more than five years, or both, in the discretion of Election of Directors. the court.'* Approved September 26, 1918. In connection with the coming election of Class A and B directors of Federal Reserve Cattle Loan Agencies. Banks, the following letter was sent to Federal Reserve Agents under date of September 19: The War _Finance Corporation on September 7 issued the following circular: House bill No. 11283, generally known as the Phelan bill, has passed both Houses of INFORMATION FOR BORROWERS. Congress and now awaits the signature of the The corporation considers that the business of raising- President. Section 4 of the Federal Reserve live stock is contributory to the prosecution of the war, Act, which relates to the election of directors and, in proper cases, is willing to give financial assistance I of Class A and Class B, amended by this bill, where needed, preferably by lending to banks, trust com- I read as follows: panies, and other financial institutions which make loans on live stock. All banks have been advised by the Directors of Class A and Class B shall be chosen in the Federal Reserve Bank of their respective districts how following manner: this assistance may be obtained. The Federal Reserve Board shall classify the member As the banks, trust companies, and cattle loan companies banks of the district into three general groups or divisions, throughout the country have ample funds to loan for short designating each group by number. Each group shall periods of time on "feeder" cattle, the assistance of the consist as nearly as may be of banks of similar capitaliza- War Finance Corporation is not needed to carry this class tion. Each member bank shall be permitted to nominate of cattle, and it will consider only loans on stock cattle, to the chairman of the board of directors of the Federal meaning cows, bulls, calves, and cattle under two years Reserve Bank of the district one candidate for director of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOKEIt 1. 1918. FEDERAL RESERVE BULLETIN. 951 A and one candidate for director of Class B. The the election of directors and in the qualificacandidates so nominated shall be listed by the chairman, tion of candidates. indicating by whom nominated, and a copy of said list Each bank in your district should be reshall, within 15 days after its completion* 'be furnished by the chairman to each member bank. Each member quested either to amend its by-laws so as to bank by a resolution of the board or by an amendment to authorize one of its officers to cast the vote of its by-laws shall authorize its president, cashier, or some the bank in the election of Class A and Class B other officer to cast the vote of the member bank in the directors, or to pass a resolution to this effect, elections of Class A and. Class B directors. Within 15 days after receipt of the list of candidates and to file with you a copy of the amendment the duly authorized officer of a member bank shall certify to its by-laws or of the resolution adopted. to the chairman his first, second, and other choices for As soon as the Federal Reserve Board has director of Class A and Glass .B, respectively, upon a classified the banks in your district arrangepreferential ballot upon a form furnished by the chairman of the board of directors of the Federal Reserve Bank of ments should be made to hold an election of the district. Each such officer shall make a cross opposite directors to succeed those whose terms expirethe name of the first, second, and other choices for a direc- on December 31, 1918, tor of Class A and for a director of Class B, but shall not The Board will, therefore, be glad to have vote more than one choice for any one candidate. your suggestions as to grouping of banks in No officer or director of a member bank shall your district as early as possiblebe eligible to serve as a Class A director unless nominated and elected by banks which are members of the same group as the member Treasury Certificates of fadebtediaessbank of which he is an officer or director. Any person who is an officer or director of The following statements were issued by the more than one member bank shall not be Treasury Department under date of September eligible for nomination as a Class A director 12 and 13: except by banks in the same group as the bank SEPTEMBER 12, 1918. having the largest aggregate resources of any Secretary McAdoo to-day announced that the fifth of those of which such person is an officer or biweekly issue of United States Treasury certificates of indebtedness in anticipation of the fourth Liberty loan director. was oversubscribed §144.529.500. The Secretary "stated It will bo observed that the Federal Reserve that this is a most gratifying result, the oversubscription Board is now required to classify the member being the largest ever recorded on any issue of United banks of each district into three groups or States Treasury certificates of indebtedness. Ten of the twelve Federal Reserve districts oversubdivisions as a preliminary to the election of scribed their quotas. The total subscriptions aggregate directors. The Board will be glad to have 8644,529,500. ^ The aggregate of subscriptions for certifisuggestions from you as to the proper classifi- cates in anticipation of the fourth Liberty loan to date is cation of banks in your district. $3,404,071,000. It will also be observed that under this amendment each member* bank is required Federal Reserve Bank. Quota. 1Bsu.bscription. by resolution of its Board, or by amendment to its by-laws, to authorize its president, United States Treasury. S3,000,000 Boston 843.300,000 57,424,000 cashier, or some other officer to cast the vote New York 160,600,000 210,0G8,500 Philadelphia 35,300,000 42,061,000 of the member bank in the election of Class A Cleveland 45,300,090 74,088,000 and Class B directors instead of having a dis- Richmond 17,300,000 18,957,000 Atlanta 14,000,000 21,242,000 trict reserve elector perform this service. Chicago. 70,000,000 88,279,000 St. Louis ! 20,000,000 25,501,500 This amendment also prohibits any officer Minneapolis. 17,300,000 17,200,000 or director of a member bank from serving as a Kansas City... 20,000,000 25,913,000 Dallas 12,000,000 11,295', 500 Class A director unless nominated and elected San Francisco. 35,300,000 49,500,000 by banks which are members of the same Total 500,000, Q00 644.529,500 group as the member bank of which he is an officer or director. Any person who is an SEPTEMBER 13, 1918. officer or director of more than one member Secretary McAdoo, under the authority of the act apbank is not eligible for nomination as a Class A proved September 24, 1917, as amended by the act approved April 4, 1918, offers for subscription, at par and director except by banks in the same group accrued interest, through the Federal Reserve Banks, as the bank having the largest aggregate $600,000,000 or more Treasury certificates of indebtedness, resources of any of those of which such person Series IV-F, dated and bearing interest from September is an officer or director. The attention of the 17,1918, payable January ] 6,1919, with interest at the rate member banks in your district should be called of 4-| per cent per annum. Applications will be received at the Federal Reserve Banks. Subscription books will to this change in the method of procedure for close at the close of business September 24, 1918. 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952 FEDERAL EESEBVE BULLETIN. OCTOBER 1,1918. cates will be issued in denominations of §500, .151,000, $5,000 having been received after tabulation of the $10,000, and $100,000. Said certificates shall be exempt, answers upon which the report is based, the both as to principal and interest, from all taxation now or analysis hereinafter made is taken from 330 hereafter imposed by the United States, any State, or any of the possessions of the United States, or by any local tax- banks, or between 55 and 60 per cent of the ing authority, except (a) estate or inheritance taxes, and mutual savings banks in the United States, (6) graduated additional income taxes, commonly known with about 65 per cent of the total resources. as surtaxes, and excess profits and war profits taxes, now or The data hereinafter contained are from 169 hereafter imposed by the United States upon the income or profits of individuals, partnerships, associations, or cor- banks in New England out of 405, having 60 porations. The interest on an amount of bonds and cer- per cent of the total assets of such banks. The tificates authorized by said act approved September 24, Eastern States, 105 banks out of a total of 196, 1917, or by said act as amended by said act approved April with more than 60 per cent of the total assets. 4, 1918, or by the act approved July 9, 1918, the principal of which does not exceed in the aggregate S5,000, owned by Ohio is represented by 100 per cent of the total any individual, partnership, association, or corporation, savings bank assets. California is represented shall be exempt from the taxes provided for in clause (6) by 38 banks with about 60 per cent of total above. Upon 10 days' public notice, given in such manresources. ner as may be determined by the Secretary of the Treasury, the certificates of this series may be redeemed as a whole at Total present holdings of Liberty loan bonds. par and accrued interest on or after any date, occurring The answers permitted a calculation of the before the maturity of such certificates, set for the payment of the first installment of the subscription price of any percentage of Liberty bond holdings to total bonds offered for subscription by the United States after assets of the banks. the offering and before the maturity of such certificates. Per cent. The certificates of this series, whether or not called for re- Maine 4. 9 demption, will be accepted at par, with adjustment of ac- New Hampshire 3. 9 crued interest, if tendered on such installment date in Vermont 3. 8 payment on the subscription price then payable of any Massachusetts 3.4 such bonds subscribed for by and allotted to holders of Rhode Island 1. 4 such certificates. The certificates of this series do not bear Connecticut 4. 5 the circulation privilege and will not be accepted in payment of taxes. The right is reserved to reject any sub- New England States 3. 7 scription and to allot less than the amount of certificates applied for and to close the subscriptions at any time with- New York 3.8 out notice. Payment at par and accrued interest for cer- New Jersey 3. 4 tificates allotted must be made en and after September Delaware/. 2. 5 17, 1918, and on or before September 24, 1918. After Pennsylvania 2. 4 allotment and upon payment, Federal Reserve Banks Maryland 3. 8 will issue interim receipts pending delivery of the definitive certificates. Qualified depositaries will be permitted Eastern States 3. 7 to make payment by credit for certificates allotted to them for themselves and their customers up to an amount for Ohio, representing Middle West 1. 4 which each shall have qualified in excess of existing deposits when so notified by Federal Reserve Banks. As fis-| California 2. 9 cal agents of the United. States, Federal Reserve Banks j Partial-payment subscriptions to first, second, are authorized and requested to receive subscriptions and I and third Liberty loans, still unpaid. to make allotment in full in the order of the receipt of i This answer permitted a calculation of the applications up to amounts specified in the respective districts. percentage of Liberty-bond subscriptions on the partial-payment plan remaining unpaid to the Condition of Savings Institutions In the United total partial-payment subscriptions. States. Per cent. Maine 11. 3 The following abridged statement presents New Hampshire 51. 7 some important facts relative to the condition Vermont. " 53. 8 Massachusetts 41 of the savings banks of the country: Rhode Island 79. 4 Since the beginning of the war it has been Connecticut 17. 4 the purpose of the savings bank section, Ameri- New England States 33.47 can Bankers' Association, to make a semiannual analysis of the savings bank situation New York 22. 2 as gathered from, questionnaires submitted to New Jersey 35. 2 Delaware 2 all mutual savings banks, of which there are Pennsylvania 8. 5 622 in the country, and to representative stock Maryland 39. 8 savings banks and trust companies, the chief business of which is savings. Eastern States 23.5 Out of 650 banks communicated with 420 Ohio 13. 2 answered. On account of about 90 answers California 11.1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 953 Approximately, what was the proportion of sub- ersJ acceptances as an investment. These scribers who paid on partial-payment plan reg- objectors showed rather definitely by their ularly? ! answers that they did not appreciate the meaning of the bankers' acceptance as an Percentage totals are given as follows: investment. Many have not bought such ac- Per cent. ceptances, and express an opinion that they Maine 72.8 "believe in them heartily and as soon us pos- New Hampshire 65. 2 Vermont : 75 sible shall invest in them liberally.77 Another Massachusetts 71. 2 would invest in bankers7 acceptances, except Rhode Island 33 that Treasury certificates of indebtedness at 4J Connecticut 65. 8 per cent and tax exempt appeal to them more. Several have the opinion that the rates were New England States 70. 0 unattractive. The Maine banks are inclined New York 71. 5 to think well of the bankers' acceptance, New Jersey 65 although some were still imbued with the old Delaware /. 90 savings-bank thought that it was "foreign to Pennsylvania 40. 7 Maryland 75 the underlying principles governing the work of savings banks.77 Another New England Eastern States 68.4 banker stated that he had "no objection to the bankers7 acceptance, except that demand Ohio 82 collateral loans of Boston pay a better rate." California 82 Purchases of Treasury certificates of indebted- HOLDINGS OP IXVESTMENTS. ness. The larger part of the banks, of course, have I State Heal Perpurchased certificates of indebtedness. An in- ; Rail- and Public estate sonal Other teresting indication is found in the probability State. | road muni- utility mort- secur- securii bonds. cipal bonds. gage ity ties. of a greater subscription from the savings banks bonds. loans. loans. to the fourth Liberty loan than to any previous war loan, and in some respects greater than the Per ct. Per ct. Per ct. Perct. Per ct. Per ct. Maine j 38.2 21.3 16.8 13.2 0.8 9.7 combined subscriptions of the three previous New Hampshire | 20.4 10.4 9.3 31.2 4.0 24.7 loans. The following table evidences the activ- Vermont i 1.6 20.2 73.9 2.1 2.2 Massachusetts | 17.0 11.0 3.4 51.9 13.5 3.2 ity in this respect: Rhode Island \ Connecticut | 35.6 15.4 1.7 39.3 1.9 7.0 Now York State I 16.1 23.0 55.9 .1 4.9 New York City | 16.6 23 7 55 6 2 3.9 Pe a r t s o c s t e e a t n l s t . of B s a c n r k ib s i n s g u . b- B s a c n r s i k u b s b i n - n g o . t ! ! N D Pe e e n w la n w s J y a e r l r v e s . e a * y n ia ' 3 5 3 7 2 8 . . . f 8 3 i 2 3 1 4 4 2 . . . 8 2 6 2 7 . . . 1 2 2 4 4 1 3 2 0 . . . 6 7 5 . . . 2 1 1 4 4 3 . . . 7 6 7 Maryland 55.8 12.6 It. 5 14.8 5.3 i District of Columbia. 8.0 .2 6.8 60.5 24.5 Maine 6.6 California 2.8 13.4 2.3 57.6 4.9 19.0 New Hampshire. 5.5 Vermont 3.8 Massachusetts 3.1 Rhode Island 1.9 ANALYSIS OF PURCHASES OF LIBERTY BONDS BY Connecticut 2.5 VARIOUS BANKS. Now England States . 3.2 132 New York 2.8 In order to investigate the variation of hold- New Jersey... 9.7 ings of Liberty bonds by different groups of Delaware 4.6 Pennsylvania. 10.5 banks, the statistical data as contained in the Maryland 16.3 individual questionnaires were divided into five Eastern States. 4.7 90 main groups, as follows: Ohio 5.3 California. 11.3 1. Banks with assets in excess of 880,000,000. 2. Banks with assets from $10,000,000 to $80,000,000. 3. Banks with assets from $5,000,000 to $10,000,000. BANKERS7 ACCEPTANCES. 4. Banks with assets from $2,000,000 to $5,000,000. 5. Banks with assets below $2,000,000. Only 15 banks out of a total of 333 hold bankers' acceptances—6 in Massachusetts, 4 in Expressing the holdings of Liberty bonds in Connecticut, 3 in New York, and 2 in Califor- percentages of total assets, there is obtained nia. Only 8 banks had objections to the bank- the following table for various parts of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

954 FEDERAL RESERVE BULLETIN. OCTOKKX 1, 1018. country (class 1 refers to banks with assets in ; There seems to be a well-defined movement excess'of $80,000,000, and so on): i both in New York and Massachusetts, while I the figures from Maine and New Hampshire I show" a rather erratic movement. For New York j New Jersey, I ! there is a very marked clustering in the interval Ponnsyl- ! M N a a n o i d n w e, ch M u a s s e s t a t - s. C t o ic n u ne t. c- v w a la n a n r ia d e , , , M D an e a d l r a y - - j j j Y N o e r w k. fo C r a n l i i a - . i ! b g e r t o w u e p e n i n 2 M an a d ss a 3 c , h u w s h e i t l t e s t f h al e l s m in o st t h i e m p in o t r e t r a v n a t l H sh a i m re p . - D Co is l t u r m ic b t i o a f . I i ; between 3 and 4. On the other hand, 10.5 per i cent of the New York figures fall above a percentage holding of 6, while the corresponding Per cent Per cent Per cent. Percent. [Per cent. \ Per cent \ Class 1 2.70 2.63 I figure for Massachusetts is 3.7 per cent only. C C l l a a s s s s 3 2 5 4 . . 4 0 6 7 3 3 . . 2 5 0 1 3 4 . . 5 9 8 0 3 5 . . 9 4 0 3 4 6 . . 1 S 5 I j i 3 6 . . 0 9 5 2 i ! The Central Atlantic States (Pennsylvania, Class 4.... 3.65 3.93 3.99 4.44 5.91 | 3.30 |Maryland, New Jersey, Delaware, and the Class 5 3.35 3.52 1.89 5.93 4.83 i 4.94 I District of Columbia) show a movement similar i to New York, except for an exceptionally high From this table it appears that the average- frequency of percentage holdings above 8 per size banks with assets between $5,000,000 and cent. $10,000,000 have relatively been the heaviest Siurchasers of bonds, except in the States of fame and New Hampshire, where the largest British Bank Amalgamations. banks have led in the purchasing of bonds. Massachusetts seems as a whole to have pur- In view of the interest generally felt by chased a relatively lower share of Liberty American bankers in the development of bonds through its savings banks than the other British bank amalgamations which have been States, while New York relatively holds the in progress during the past year, the following highest position. The reports available from report of a special committee appointed by other States are too few in number to possess the British Government, which completed its any significance. work not long ago, is reprinted as a matter of While the above figures give the summary information: result by various localities and States as a j To the Lords Commissioners of Tils Majesty's Treasury: whole, still more pronounced variations are j 1. We, the undersigned committee, appointed by shown by analyzing; the returns for individual | treasury minute of the 11th March last, beg to submit banks. For instance, in the State of New York our report to your lordships. it appears that among 72 savings banks, with 2. We have held eight meetings, and have examined the following witnesses, viz: (List of witnesses omitted.) almost $1,000,000,000 in assets, the percentage We have also received a number of communications in holdings of Liberty bonds to total assets varied writing from gentlemen in various parts of the country, from 0.91 per cent to 25.46 per cent. in response to a notice which we inserted in the press A fairly good idea of the variation of the inviting representations from the public generally. Unfortunately, time did not permit of our taking oral percentage holdings to total assets may, howevidence from more than a limited number of witnesses. ever, be secured from the following frequency 3. Bank absorptions and amalgamations are, of course, distributions relating to New York, Massa- no new phenomenon in this country. About 300 instances chusetts, Maine, New Hampshire, Connecticut, have occurred in the past, more than half of which have taken place in the last 50 years. Jn one or two cases and the Central Atlantic States: arrangements made provisionally for amalgamations have been defeated by the opposition of local customers of the bank which it was proposed to absorb; but, on the whole, Perce e n rt t y ag b e o n h d o s ld t i o n g a s s se o t f s . Lib- Y N o e r w k. ch M u a s s e s t a t - s. a H n M d a a m N in p e e - w A C S t e t l a n a t n t e r t s a i . c l b p a a n th k i o n f g c p o o n l s i o c l y id a h t a io s n g r a a n d d u a a l b l s y o r b p u ti t o n s te a a n d d i , l y u n p t u il r s r u e e c d e n t tl h y e , shire. the amalgamations affected have, generally speaking, been carried through without stirring up serious opposition or arousing public interest. As a result, the number of private Per cent. \ Per cent. Per cent. Per cent. c-i 8.9 i 8.3 15.3 banks has fallen from 37 to 6 since 1891, and the number of 1-2 10.6 12.9 .7 19.6 English joint-stock banks from 108 to 34 during the same 2-3 34.7 19.6 16.3 48.0 period. 3-4. . 18.7 28.5 10.5 10.6 4-5 12.9 16.7 12.7 5.8 4. Several recent amalgamations, however, have un- 5-6 3.7 12.3 3.0 1.4 doubtedly provoked an unusual amount of interest, and 6-7 4.4 1.6 13.1 1.2 have been seriously criticized in certain quarters. This 7-8 1.2 1.0 25.8 8-9 .6 2.6 8.0 change in public opinion appears to be due mainly to 9-10 .9 .4 5.4 the fact that amalgamations have changed their type 10-11 3.0 and consist no longer in the absorption of a local bank by 11-12 .8 12 and over .2 a larger and more widely spread joint-stock bank, but in the union of two joint-stock banks, both already possessing Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 955 large funds and branches spread over a wide area. These the first bank in each case secured the following number of new places two types of amalgamation differ very materially from out of the total number taken over, viz. (a) 51 (out of 78), (&) 152 (out of 160), (c) 54 (oat of 109). In cases (a) and (c) very few of the new Places one another, and arguments used to justify the former secured were in towns of importance. The 55' overlapping places in type do not necessarily apply to the latter. case (c) include such towns as Barnsley, Barrow. Darlington,"Doneaster, Gatoshead, Grimsby, Hull, Leeds, MiddlesborbuRh, Newcastle, Portsmouth, Sheffield, West Hartlepool, and York; and in case (a) the 21 THE OLD TYPE OF AMALGAMATION—ABSORPTION OF LOCAL overlapping places included Bath, Birmingham, Bournemouth, Brad- BANKS BY A LARGER AND MORE WIDELY SPREAD JOINT ford, Brighton, Bristol, Derby, Donoaster, Exeter, Grimsby, Huddorsfield, Hull, Leeds, Lincoln, Nottingham, Plymouth, Sheffield, South- STOCK BANK. ampton, and York. it should be added that in case (c), in addition to the branches shown 5. As modern amalgamations are mainly of the new above, the Joint Stock Hank have 106 subbranches in small places type, it is unnecessary for us to elaborate the various where they lia"C no branch, and that in onlv about nine of those places arguments used in connection with amalgamations of the are the City and Midland represented. Similarly, the Union of London and Smith's had a number of subbranches in small places, at most of older type. Very briefly, what the arguments amount to which the National Provincial wore not represented. is that both the local (or more or less local) bank and the larger widely spread bank secure to their customers cer- There must come a point when the policy of substituttain advantages of a different kind, but that, like other ing one large bank for two will usually mean a, very small institutions, "each has also the defects of its qualities. extension of area, if any, and some reduction of competi- Some districts—notably Lancashire and Yorkshire—have tion. That point has already* been reached in London, clung to their local banks. But in most instances amalga- and is being approached in a few of the largest towns where mation schemes have been carried out without serious most of the important competing banks are already difficulty, and if material hardship had resulted to the established. trade generally in the districts affected, there would no It should be added that if both the amalgamating units doubt have been greater local opposition to subesquent have, before amalgamation, lent up to their full resources, absorption schemes, and new local banks would even home trade as a whole can not gain any increase in accomhave "been opened. modation as a result of the amalgamation. Except at the expense of smaller traders, large trade combines could not. obtain larger advances in all from the combined resources THE NSW TYPE OP AMALGAMATION—UNION OF ONE LARGE of the amalgamation than they obtained from the separate JOINT STOCK BANK WITH ANOTHER SIMILAR BANK. banks before. 6. As regards the new type of amalgamation, the main This is an important point. Various Government comarguments laid before us in support of the policy of amal- mittees have drawn special attention to the question of gamation are as follows: banking facilities after the war, and it is very desirable (a) The convenience and gain to trade secured by an exten- that all possible steps should be taken to adapt the banksion of bank areas.—Just as the large banks of the past ing interest to the new position which will then arise. secured certain advantages to trade by collecting deposits The point, however, with regard to the size of banks is one from parts of the country where they were not required, of degree only, and it is a question whether the continued and placing them at the disposal of other parts which practice on the part of exceptionally large firms of resortstood in need of advances, so it is claimed that*this process ing to two or more banks, instead of one, for advances can be carried still further with advantage by amalga- would not suffice to meet all their needs, and whether the mating large banks with one another. existing large banks are not in fact large enough to meet This is no doubt true, though, of course, the degree to the requirements of the immediate future, at any rate if which an extension of area is in fact secured by amalga- supplemented, as far as may be necessary, by combinamating banks differs considerably in each case. The fol- tions for special purposes on the lines of German "Konlowing table is an analysis of two recent amalgamations sortiums" or otherwise. We have received no conclusive and one proposed amalgamation in this respect: evidence on this point. But the following table shows, at any rate, that the resources of our leading banks were TABLE I.—Numbers in 1918 (in round figures). very substantial even before the recent amalgamations: TABLE II.—Paid-up capital, reserve, and deposits of the Provincial following hanks as shown in their balance sheets of Slst branches (excluding December, 1913, and Slst December, 1917. sub- London branches Foreign branches. an in d g i n o c n l l u v d- held. 31st Decem- 31st December, 1.913. ber, 1917. one branch in each place). London City and Midland £101,882,230 £230,033,434 London County and Westminister f(i) National Provincial 26 251 31 P N a a r t r io 's nal Provincial , \ 143,000,000 228,000,000 Union of London and Smith's 31 73 150 Union of London and Smith's } 118,804,590 185,223,175 (&) London County and Westminster 110 180 400 Lloyds 98,720,663 183.078,718 35 160 35 Barclays 166,940,207 135;675,971 (c) London City and Midland 107 419 850 London Joint Stock 41,678,237 62,274,280 London Joint Stock 41 109 70 1 June, 1914. NOTE.—in London an amalgamation can secure no material extension of area, and usually means a net reduction in the number of competing banks in the city, as all other important competitors are already repre- The above argument with regard to post-war trade can sented there and can not, therefore, as is sometimes the case in othor of course only be used with some caution as regards foreign districts, add a new element of competition to counterbalance the amal- trade, in view of the special dependence of English banks gamation. Should no such new element arise, there will be a similar net reduction in the number of competing banks in nearly all the most on deposits withdrawable at call or on short notice. This important towns outside London at which the second of the two banks is especially the case as regards long-term advances for was represented in cases (a) and (c) above, as the first bank in each case such trade, "to which special reference is sometimes made. was established at most of them already. As regards the provinces generally, excluding subbranches and subagencies, in the above cases The following figures, taken from the "Economist," show Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

956 FEDERAL RESERVE BULLETIN. OCTOBKIS 1, 1918. how comparatively small are the capital and reserves of for traders, and particularly for large traders, than small English joint stock banks: banks because, with their larger resources, they can safely make individual advances on a more generous TABLE III. scale. And it is argued that banks must grow now to keep pace with the growth in size of business houses generally, and to enable them to deal with the demands Paid-up of after-the-war trade both at home and abroad. capital and Deposits. Ratio. (b) Dangers of reduced competition.—Although, in the reserves. past, we believe that amalgamations have not, in most instances, led to a reduction of bank competition, yet, as Million £. Million £. Per cent. we have pointed out in paragraph 6 (a) above, in London 1890 68 3G9 18 (and possibly before long in certain large towns) amalga- 1 1 8 9 9 0 5 0 - ... - . 6 7 9 9 4 5 5 8 0 7 1 1 5 3 mations between large joint stock banks'must now usually 1905 82 G28 13 mean a net reduction in the number of competing banks. 1910 81 721 1.1 It is true that this reduction is only slight in each case, and 1 1 9 9 1 1 5 7 8 8 2 1 1,3 9 6 9 5 3 S 0 that there still remain at present a fair number of competing banks. But we have received representations from certain municipal corporations to the effect that 7. We have endeavored to review impartially the banks vary very much in their willingness to allow reasonarguments which have been put forward as justifying the able overdraft facilities to corporations, and that sufficient necessity in the public interest—quite apart from questions money, and cheap enough money, has only been obtained of profit to shareholders—of bringing about the new type hitherto by resorting to different banks; the number of of bank amalgamation. There is undoubtedly much resolutions have been forwarded to us by corporations weight in these arguments as far as they go. And even protesting against further amalgamations, and suggesting if the absolute necessity of large new amalgamations is that it is not in the national interest that large funds benot clearly proved, yet the absence of proof of the public longing to the public should be in the hands of a few necessity for business reorganizations is* not, in itself, any companies. reason for objecting to them, and it is a serious step at Strong representations have, on similar grounds, been any time to interfere with the natural developments of made to us on behalf of the stock exchange and the money trade. Before, therefore, considering any restrictive pro- market. It is claimed that the world-wide fame of the posals, we endeavored to ascertain what is the real basis London market before the war was due to the freedom with s of the fears—often vaguely felt, and vaguely expressed, which London bills could be negotiated, owing to the ease which have undoubtedly been aroused by recent amalga- with which discount houses obtained ample funds from a mation schemes. The' main grounds for objecting to wide number of banks, and that the fewer the lending further amalgamations appear to be as follows: constituents in the discount market the less flexible is (a) Writing down of bank capital.—The proportion of the market and the less fine the rates. It is added that the capital to deposits is now so small in the case of English number of members in the clearing house is already becomjoint stock banks, even excluding the temporary war ing very small, and that any further decrease in the numincrease in the amount of deposits, that any further ber of its constituent members, or any greatly preponderant shrinkage of bank capital is clearly undesirable, in the power on the part of particular members, might impair interest of depositors, if it can be avoided. Attention has confidence in its smooth working and raise apprehensions been drawn to the fact that amalgamation schemes usually in the market. Moreover, it is pointed out that a reducmean a reduction in the total paid-up capital and uncalled tion in the number of important banka must mean, and liability of the two preamalgamation units. This has has already meant, a reduction in the number of first-class frequently been the case in the past, and it has also been acceptors of bills, and that if this reduction proceeded a feature "of recent amalgamations and proposed amalga- very far it would become a question whether the Bank of mations. The amalgamation of the National Provincial England would not have to place a limit on the amount Bank of England, Ltd., with the Union of London and of acceptances which they would take from any particular Smith's Bank, Ltd., resulted in a reduction of over bank doing a large accepting business, and whether conti- £1,000,000, or 16 per cent, in the total paid-up capital, nental buyers would not limit the number of bills taken and oi over £9,000,000, or over 48 per cent, in the uncalled by them. liability of the Union shareholders. The amalgamation of (c) The danger of monopoly.—It has been represented to Parrs Bank, Ltd., with the London County and West- us that there is a real danger lest one bank, by the gradual minister Bank, Ltd., while it resulted in an addition of extension of its connections, may obtain such a position £243,000 to the total paid-up capital, brought about a that it can attract an altogether preponderant amount of reduction of nearly £1,770,000, or 17 per cent, in the banking business; or, alternatively, lest two banks may uncalled liability of Parr's shareholders. The proposed approach such a position independently, and then achieve amalgamation of the London City and Midland Bank, Ltd., it by amalgamation. with the London Joint Stock Bank, Ltd., would effect a Any approach to a banking combine or money trust, by reduction of nearly £1,000,000 in the total paid-up capital, this or any other means, would undoubtedly cause great and of over £9,000,000, or over 50 per cent, in the uncalled apprehension to all classes of the community and give rise liability of the Joint Stock Bank shareholders. In each to a demand for nationalizing the banking trade. Such a of these three cases, therefore, substantial benefits to combine would mean that the financial safety of the counshareholders are purchased at the expense of some of the try, and the interest of individual depositors and traders security of the depositors. But the reduction of capital would be placed in the hands of a few individuals, who (as opposed to the reduction of uncalled liability) resulting would naturally operate mainly in the interests of the in two of the cases appears to be only nominal, the sum shareholders. Moreover, the position of the Bank of written off, or some sum approximating to it, being added England—which would, it may be assumed, stand outside to the inner reserves, at any rate at present. of any such trust—would be seriously undermined by so (6) The argument from size.—Numerous representations overwhelming a combination, and the bank might find it have reached us to the effect that large banks are better extremely difficult to carry out its very important duties Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN*. 957 as supporter and regulator of the money market. Any- and of the Board of Trade should be obtained and that such result would, in our opinion, be a grave menace to legislation should be passed requiring the two departments the public interest. to set up a special statutory committee to advise them, the Further, it has been represented to us that the Govern- members of which should be nominated by the department of the day might not find it easy to adopt a course of ments from time to time, for such period as may seem dewhich the combine, for its own reasons, disapproved. sirable, and should consist of one commercial representa- While we believe that there is at present no idea of a tive and one financial representative, with power to apmoney trust, it appears to us not altogether impossible point an arbitrator, should they disagree. that circumstances might produce something approaching to it at a comparatively early date. Experience shows that, in order to preserve an approximate equality of resources and of competitive power, the larger English Status of Bank Clerks Under Draft Law. banks consider it necessary to meet each important amalgamation, sooner or later, by another. If, therefore, the argument from size, referred to in paragraph 6 (b) above, There is printed below correspondence relatis to prevail, it can only lead, and fairly rapidly, to the ing to ruling of the Provost Marshal General creation of a very few preponderant combinations; and if in the matter of classification and reclassificathose combinations amalgamated, or entered into a joint tion of bank clerks under the selective draft agreement as to rates and policy, etc., the money trust would immediately spring to birth. i law: 8. Siich are the main arguments laid before us against SEPTEMBER 23,1918. further amalgamations. Undoubtedly some of the dan-i DEAR SIR: For your information there is inclosed heregers feared are somewhat problematical and remote, and | with copy of letter from this office to the Provost Marshal we should very much have preferred to avoid the neces- ! General submitting certain questions and photostat copy sity for any interference by Government with the admin- I of reply received, both of which explain themselves. istration of banking. But on a careful review of all thei From inquiries received and complaints filed with this above considerations, we are forced to the conclusion that • office by several banks it appears that the interpretations the possible dangers resulting from further large amalga- | given to the rulings of the office of the Provost Marshal mations are material enough to outweigh the arguments | General by the local or district boards have not been enagainst Government interference, and that, in view of the tirely uniform and that in some instances bank employees exceptional extent to which the interests of the whole who were originally given a deferred classification on other community depend on banking arrangements, some grounds than that of their employment have had their measure of Government control is essential. Our con- deferred classification withdrawn under regulations dated clusions on this point were confirmed by the resolution May 23, 1918, and generally referred to as the "work or passed at the recent annual meeting of the Association of fight" regulations. This, although the Provost Marshal Chambers of Commerce, in which it was proposed that General under date of July 5, 1918, ruled that bank emsteps should be taken to guard against amalgamations, etc., ployees were not subject to reclassification under this shown to be injurious to commercial interests. order. We therefore recommend that legislation be passed re- The forces of the banks have already been materially quiring that the prior approval of the Government must depleted by the loss of registrants between the ages of 21 be obtained before any amalgamations are announced or and 31. Under the new selective draft law which extends carried into effect. And in order that such legislation may the age limits so as to include those from 18 to 45, inclusive, not merely have the effect of producing hidden amalga- it is of course obvious that some steps must be taken to mations instead, we recommend that all proposals for in- secure deferred classification for those employees who are terlocking directorates, or for agreements which in effect vitally necessary to the successful operations of the bankwould alter the status of a bank as regards its separate ing business. entity and control, or for purchase by one bank of the With the constantly increasing demands made upon the shares of another bank, be also submitted for the prior banks a further material depletion of their forces would approval of the Government before they are carried out. render it difficult for the banks to perform the services As general principles to be acted upon at present by the required of them by the United States in the present Government at its discretion, we would suggest that a emergency. scheme for amalgamating or absorbing a small local bank, While the Federal Reserve Board, of course, realizes or any scheme of amalgamation designed to secure im- that the officers of the Federal Reserve Banks will not deportant new facilities for the public or a really consider- sire to ask for deferred classification for employees who able and material extension of area or sphere of activity may be spared to enter the military service, it is of prime for the larger of the two banks affected, should normally importance to our Government that its fiscal operations be considered favorably, but that if an amalgamation conducted through the banks shall be maintained at the scheme involves an appreciable overlap of area without highest standard of efficiency and to this end that all securing such advantages, or would result in undue pre- necessary steps should be taken to procure a proper classidominance on the part of the larger bank, it should be fication of necessary employees in accordance with the refused. Consideration should also, in our opinion, be letter and spirit of the selective draft act and regulations given to the question of the clerical labor—usually very of the War Department. large—involved by amalgamations during the war, and to To this end it is necessary that some uniform practice the undesirability of permitting an unusual aggregation of should be adopted by the several banks in presenting deposits without'fully adequate capital and reserves. claim for deferred classification and that the regulations 9. It only remains to make a suggestion to which Gov- and rulings of the War Department which specifically ernment department or departments should be charged I affect bank employees should be called to the attention of with the responsibility of approving or disapproving amal- jall local boards. gamation schemes, etc., under our proposal above. On | The accompanying memorandum which suggests a the whole, we think that the approval both of the Treasury !method of procedure to be followed has accordingly been 83.463—18 6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

958 FEDERAL RESERVE BULLETIN. OCTOBER 1', 1918. prepared for the information of the officers of Federal In your letter to this office, dated July 5,1918, you state: Reserve Banks and member banks. "I beg to advise you that bank clerks are exempted from Respectfully, the operations of the regulations which provide for the W. P. G. HARDING, withdrawal of deferred classification and order number of Governor. registrants found to be idlers or engaged in nonproductive The CHAIRMAN FEDERAL RESERVE BANK. occupations or employments." It is assumed that this ruling will also apply to clerks and employees of the Federal Reserve Board, but this view SEPTEMBER 11, 1918. has apparently not been taken by your local board, and has Maj. Gen. E. H. CROWDER, , not been regularly applied by other local and district Provost Marshal General, boards to bank clerks and employees. In other words, it War Department, Washington, D. C. appears to tins office that some of the local boards have con- SIR: Receipt is acknowledged of your letter of Septem- fused your regulations which relate to the original classifiber 6, addressed to the Secretary of the Federal Reserve cations of registrants with your work or fight regulation, Board, and which relates to a ruling reported by the press which requires re classification of registrants in a'deferred as having been made by your office to the effect that bank class who are engaged in nonessential occupations. clerks may be given a deferred classification on the ground In order that the Board may be advised as to the proper that they are engaged in an essential occupation or em- procedure to be followed in cases which affect its employployment. ees and may advise the Federal Reserve Banks and mem- You state that your office has not ruled that employees ber banks in cases affecting officers and employees of such of banking institutions as such are entitled to deferred banks, this office will greatly appreciate a specific ruling on classification. the following cases: The Board understands that bank clerks as a class are not First. Are employees of the Federal Reserve Board by reason of their employment entitled as a matter of right excepted from the operations of the regulations which to a deferred classification, but has understood your previ- provide for the withdrawal of deferred classification and ous ruling to be that where a bank clerk has for other order number of registrants found to be idlers or engaged reasons been given a deferred classification, it is not neces- in nonproductive occupations or employment? sary for a local or district board to reclassify him under Second. Is it within the province of a local or district what is known as the work or fight order. board to reclassify a registrant engaged in an occupation or As pointed out in previous correspondence with your employment which has been excepted from the operation office, the forces of the banks have already beon materially of the work or fight regulation, where the deferred classidepleted and the officers of the banks are endeavoring to fication of such registrant is not based upon his employreplace as rapidly as possible those who have been called ment but upon other grounds? under the selective-draft law with women or with men who Third. If a local or district board reclassifies a registrant are not of draft age. It is difficult at best, however, for under the work or fight regulation on the ground that he is the banks to maintain a force sufficient to meet the de- engaged in a nonproductive occupation or employment, mands made upon them in the present circumstances and, is the finding of the board conclusive or may it be reviewed since the age limit has been extended so as to include most other than by the President? of the officers as well as the employees of the bank, the Fourth. If a local or district board reclassifies a regisproblem of maintaining the banking forces has become an trant onthe ground that he is engaged in a nonproductive even more serious one. occupation or employment and the attention of the Board While there, is no desire on the part of the Federal Re- is called to the fact that the occupation or employment serve Board, nor of the officers of the Federal Reserve engaged in is one which has been excepted by your office Banks, to ask for the exemption or deferred classification from the operations of the work or fight order, can the Board of nonessential officers or employees who may be utilized annul such reclassification? in the military service, you will, of course, understand The Board would like to issue a circular to the banks that if such officers and employees are required under the outlining procedure to be followed in cases where local work or fight order to seek other employment, it will be boards have reclassified employees under the work or fight impossible for the banks to perform the services required order in violation of your ruling of July 5, and also as to the of them by the United States. procedure to be followed in obtaining a deferred classifi- The same problem is involved in the maintenance of the cation for essential officers or employees when those who force of the Federal Reserve Board. A case has arisen are required to register on September 12 are classified. during the past week which illustrates the difficulties that It is understood, of course, that none of such registrants are being encountered. One of the messengers employed will be given a deferred classification because of their by the P edoral Reserve Board who is within the. draft age employment, even though banking is classified as an was classed in Class 4 (a) by the local board in January, essential occupation, unless the officer pr employee is one 1918, because of the fact that he had dependents and not whose services can not be dispensed with without serious because of the fact that he was employed by the Board. detriment to the work of the bank. Under the work of fight order he was recently summoned If your office has prepared any forms to be used in this before the draft board to show cause why he should not be connection or any specific regulations as to the method of reclassified, and has been advised that he must find another procedure to be followed, the Board will greatly appreciate position within 10 days or he will be subject to the draft. it if you will have it furnished with copies. It desires to The effect of this ruling appears to be that the work of cooperate with your office in every way in facilitating the the Federal Reserve Board is classified by the local or dis- proper classification of the employees of the Federal trict board as nonessential. It is, of course,., obvious that Reserve Board and the officers and employees of the if this position is to be taken by your local board, and if several banks. To this end the Board will be glad to every employee of the Federal Reserve Board who for receive any and all instructions you may desire to have other reasons has been given deferred classification, is transmitted to the banks or to have published in its required under the work or fight order to seek other em- monthly bulletin. It will also be glad to have its counsel ployment or to be subject to the draft, it will not be possible confer with a representative of your office if agreeable to for the Board to perform its functions. you, in order that the Board may obtain the information Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 959 necessary to enable it to deal with questions arising under as the "work or fight" order. This order, which was proyour regulations. mulgated on May 23, 1918, provides in part that: Respectfully, "Whenever, after July 1, 1918, any registrant in Class I, W. P. G. HARDING, Governor. II, III, or IV, wherever he may be located, is reported to or observed by any local board * * * to be an idler, or to be engaged in any occupation or employment defined and described in these regulations or any amendments CLASSIFICATION OP REGISTRANTS UNDER THE ACT OP MAY thereof as a nonproductive occupation or employnemt, 18, 1917. such local board shall, by notice as hereinafter prescribed, As originally enacted.—Under the act of May 18, 1917' notify him and set a day and hour when the registrant may entitled'"An act to authorize the President to increase appear and present such evidence, by affidavit or othertemporarily the military establishment of the United wise, bearing upon the reasons for his status, as he may States," registrants may be given a deferred classification care to submit." by reason of their employment when "engaged in indus- In answer to inquiry submitted by the Federal Reserve tries, including agriculture, found to be necessary to the Board, the Provost Marshal General, on July 5, 1918, ruled maintenance of the military establishment, or the effective that bank clerks were not subject to reclassification under operations of the military forces, or the maintenance of this order,and under date of September 16,1918,ruled that— national interests during the emergency." | "It is not within the province of a local or district board The district board has exclusive jurisdiction over cases | to withdraw deferred classification or order number on the of this sort, and local boards are not authorized to give aj ground that the registrant is engaged in a nonproductive registrant a deferred classification on the ground of his| occupation in any case which has been excepted from the employment. It is understood that the district boards | operation of the regulations authorizing such withdrawal." have ruled that banking is not an industry within the | In any case in which a bank employee has been reclassimeaning of this statute, and that bank clerks can not, I fied under the "work or fight" order, the officers of the therefore, be given a deferred classification by reason of bank should call the matter to the attention of the adjutheir employment. tant general of the State for correction. As amended by the act of August 31, 1918.—The act of August 31,1918, amends the act of May 18,1917, in several CLAIM FOR DEFERRED CLASSIFICATION OF BANK CLERKS particulars. The provision quoted above is amended so WHO REGISTERED ON SEPTEMBER 12. that registrants may now be given a deferred classification While the Provost Marshal General has ruled that under when "engaged in industries, occupations, or employ- the selective draft act as amended bank clerks may be ments, including agricultural, found to be necessary to the given a deferred classification by reason of their employmaintenance of the military establishment," etc. ment, he has repeatedly called attention to the fact that In response to an inquiry submitted by the Federal each individual case must be considered on its merits and "Reserve Board, the Provost Marshal General, under date that no employees will be entitled as a class to automaticof September 16, 1918, has ruled as follows: ally receive a deferred classification. Officers of banks de- "Under this amendment district boards may properly siring to file claims for deferred classification of necessary consider claims for deferred classification of those engaged employees, should therefore procure a copy of extract from in banking, and as with industrial claims, so with occupa- Revised Selective Service Regulations, which sets forth tional claims, each case must be considered by the district ! very clearly the procedure to be followed and character of board on its merits. It must be shown both that the enter- | proof required in each case. prise in which the registrant is engaged is necessary and I As each case must be considered OIL its own merits it is that he is necessary to the enterprise." suggested that banks seeking to obtain deferred classification for necessary employees should proceed as follows: RECLASSIPICATION OP REGISTRANTS BETWEEN THE AGES First. Prepare and submit to the district board evidence OP 21 and 31 ENGAGED IN ESSENTIAL EMPLOYMENT. showing the nature and extent of the bank's operations and character of service rendered to the Government, together It is understood that a number of bank employees whose with any information that may be necessary to satisfy the claims for deferred classification were based on the groundi board that the bank itself is "a necessary occupation," of their employment have not yet been called to the mili- within the meaning of the act of May 18,1917, as amended tary service. The question, therefore, arises whether in by the act of August 31, 1918. view of the amendment above quoted, these employees Second. A list of those employees necessary to the bank may now be given a deferred classification if it can be should be carefully prepared and arrangements should be demonstrated that they are necessary to the successful made with such employees to submit their questionnaires operation of the banks employing them. to a committee appointed by the bank before they are filed. The Provost Marshal General has been asked for a ruling Proper notation should be made by the bank on the on this question. If he rules that such cases may be re- questionnaire of claim for deferred classification, using opened by the district boards, a copy of his ruling will be Series XI, entitled, "Industrial occupation." furnished upon request for presentation to the district The Provost Marshal General has called attention to the boards, and in such cases banks should apply for a re- fact that it was necessary to print the questionnaires before classification of those employees who are necessary to the Congress amended the law, so that the necessary changes operations of the bank. fiach case will, of course, have could not be made therein. While, therefore, banking to be considered on its merits. has been held not to be an industry, claim for deferred classification is made under this general head. WITHDRAWAL OP DEFERRED CLASSIFICATION UNDER THE It is further suggested that such questionnaires should WORK OR PIGHT ORDER. be accompanied by an affidavit of an officer of the bank containing the following information as to the status of each It appears that in some instances registrants between the employee for whom a deferred classification is claimed. ages of 21 and 31 have been given a deferred classification (a) Character of service rendered; on grounds other than their employment and have subse- (6) Length of time the employee has been in the sendee quently been reclassified under what is usually referred to of the bank; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

960 FEDERAL EESEBVE BULLETIN. OCTOBER 1,1918. (c) The capacity, training, and experience of employee, Iam sending you herewith two copies of the questionnaire, and the extent and value of his services; ' the key list of occupations, an explanatory memorandum (d) The effect on the operations of the bank that might to be inserted in each questionnaire, and an extract from be expected to result from the loss of his services; the revised selective-service regulations, which states the (e) Difficulty that would be experienced in filling the amended rules with respect to classification on occupaplace of employee; tional grounds. (/) That officers of the bank have no reason to believe or As you are aware, Congress has amended the selective to suspect that the employee obtained service with the service act, so that district boards now have jurisdiction bank for the primary purpose of evading military service. to consider and grant claims for deferred classification on the ground of engagement in necessary industries, occu- APPEALS. pations, or employments, including agriculture. Under this amendment district boards may properly consider In cases where district boards decline to give a necessary claims for deferred classification by those engaged in bankemployee deferred classification the vote of the board ing; and as with industrial claims, so with occupational should be ascertained, and if one or more members voted claims, each case must be considered by the district board in favor of deferred classification the case may be appealed on its merits. It must be shown both that the enterprise to the President. Such appeal must be accompanied by in which the registrant is engaged is necessary, and that he the written and signed recommendation of one member is necessary to the enterprise. As stated in the explanaof the local board and either the Government appeal agent tory memorandum inclosed herewith, all such claims or adjutant general of the State should be made on the questionnaire, using Series XI, entitled "Industrial occupation." It was necessary to print the questionnaire before Congress amended the lw, so that the necessary changes could not be made therein. [Copy of Photostat.] This office is not fully informed .as to the status of em- WAR DEPARTMENT, ployees of the l?ederal Reserve Board, but if they are legally employees of the United States it is suggested that OFFICE OF THE PROVOST MARSHAL GENERAL, claims for their deferment might be made under the pro- Washington, September 16, 1918. visions for the deferred classification of necessary Federal employees, for which provision is made in Series VIII, Hen. WILLIAM P. G. HARDING, Part A, of the questionnaire, and in section 77 of the Governor, Federal Reserve Board, selective-service regulations. A copy of this last-men- Washington, D. C. tioned section is herewith inclosed, together with a copy DEAR SIR: I am in receipt of your letter of September 11, of telegram B-2710 of August 20, giving further instructions in which you ask for specific rulings in regard to the recent with respect to the proof required in support of such claims. amendments to the selective-service regulations which Attention is invited to the fact that claims for necessary prescribe certain occupations as nonproductive. Federal employees are within the jurisdiction of the local First. Employees of the Federal Reserve Board are not boards; whereas the district boards have exclusive original included within the operation of the regulations which jurisdiction of occupational claims. provide for the withdrawal of deferred classification and order number of registrants found to be idlers or engaged E. H. CROWDER, in nonproductive occupations or employments, unless they Provost Marshal General. are engaged in certain occupations enumerated in para- By JOSEPH FAIRBANKS, graphs (a) and (6) of section 121-K, selective-service regu- Lieutenant Colonel, Judge Advocate. lations, a copy of which is herewith inclosed. Second. It is not within the province of a local or district board to withdraw deferred classification or order number on the ground that the registrant is engaged in a nonproductive occupation in any case which has been SEPTEMBER 25, 1918. excepted from the operation of the regulations authorizing DEAR SIR: In further reference to circular letter of such withdrawal. September 23,1918, on the above subject, there is inclosed Third. The findings of a local and district board are herewith photostat copy of ruling of the Provost Marshal conclusive unless there is at least one negative vote in the General to the effect that the act of May 18, 1917, as district board and the appeal is accompanied by the amended by the act of August 31, 1918, applies without written and signed recommendation of one member of the distinction to the registrants of all registrations and that local board and either the Government appeal agent or the the district board having jurisdiction over a registrant may adjutant general of the State, in which case it may be re- up to the time of induction by the local board, reopen the viewed by the President, as provided in section 121-J. case previously determined and grant a deferred classifi- Fourth. If a local or district board reclassifies a regis- cation where the case on its merits entitles the registrant trant on the ground that he is engaged in a nonproductive to such classification. occupation or employment, and the person, as a matter of In cases where employees between the ages of 21 and 31 fact, is not engaged "in such nonproductive employment, are necessary to the successful operation of the bank, but the matter should be called to the attention of the adjutant have been placed in class 1, t£e district board should be general of the State for correction, or, if as outlined above, asked to reconsider their cases under authority of the there is a negative vote in the district board, etc., it may ruling of the Provost Marshal General and to give them a be appealed to the President. deferred classification on the grounds of their employment. Fifth. A messenger should not have his deferred classi- In all such cases it will be necessary to submit the same fication and order number withdrawn, as he is not within character of proof that is required in the case of an original the provisions of section 121-K of the selective-service classification. regulations. Respectfully, With reference to occupational claims for deferred clas- J. A. BRODERICK, Secretary. sification for employees of the Federal Reserve Board, The CHAIRMAN'FEDERAL RESERVE BANK. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL BESEBVE BULLETIN'. 961 [Copy of photostat.] est on an aggregate principal amount of such bonds exceeding one and one-half times the principal amount of bonds WAR DEPARTMENT, of the fourth Liberty loan originally subscribed for by OFFICE OF THE PROVOST MARSHAL GENERAL, such owner and still owned by him at the date of his tax Washington, September 21, 1918. return; and Hon. W. P. G. HARDING, (3) The interest on an amount of bonds, the principal of Governor, Federal Reserve Board, which does net exceed $30,000, owned by any individual, Washington, D. C. partnership, association, or corporation, issued upon con- SIR: This office is in receipt of your letter under date version of 3J per centum bonds of the first Liberty loan of September 20, making inquiry whether the act of in the exercise of any privilege arising as a consequence August 31, 1918, amending the "act of May 38, 1917, of the issue of bonds of the fourth Liberty loan, shall be will apply to bank employees between the age of 21 and 31 exempt from such taxes. who have heretofore been placed in Class I, who (a) have The exemptions provided in this section shall be in addim not been called to the military service, the finding of tion to the exemption provided in section 7 of the second the local board having been appealed from and the appeal Liberty bond act in respect to the interest on an amount being pending before the district board, or (b) whose of bonds and certificates, authorized by such act and appeal has been confirmed by the district board but who amendments thereto, the principal of which does not has not been called. exceed in the aggregate $5,000, and in addition to ail other With respect to the foregoing you are advised that the exemptions provided in the second Liberty bond act. act as amended applies without distinction to the regis- SEC. 2. That section 6 of the second Liberty bond act trants of all registrations, and that the district board hav- is hereby amended by striking out the figures "$2,000.ing jurisdiction over a registrant may, up to the time of 000,000," and inserting in lieu thereof the figures " $4,000 r actual induction by the local board, reopen a case pre- 000,000." Such section is further amended by striking viously determined, and grant deferred classification out the words "The amount of war-savings certificates sold upon a finding that the registrant is actually and com- to any one person at any one time shall not exceed $100, pletely engaged in an industry, occupation, "or employ- and it shall not be lawful for any one person at any one ment, including agriculture, that is necessary to the main- time to hold war-savings certificates to an aggregate amount tenance of the military establishment, or' the effective exceeding .$1,000." and inserting in iieu thereof the words operation of the military forces, or the maintenance of the "It shall not be lawful for any one person at any one national interest during the emergency, and that such time to hold war-savings certificates of any one series to registrant occupies such a necessary status with respect an aggregate amount exceeding $1,000." thereto that he can not be replaced without direct sub- SEC. 3. That the provisions of section 8 of the second stantial material loss and detriment to the adequate and Liberty bond act, as amended by the third Liberty bond effective operation of the same. act, shall apply to the proceeds arising from the payment of war-profits taxes as well as income and excess profits E. H. CHOWDER, taxes. Provost Marshal General. SEC. 4. That the Secretary of the Treasury may, during By ROSCOE S. CONKLING, the war and for two years after its termination, make Lieut. Colonel, J. A., arrangements in or with foreign countries to stabilize the Chief, Classification Division. foreign exchanges and to obtain foreign currencies and credits in such currencies, and he may use any such credits and foreign currencies for the purpose of stabilizing or rec- New Bond Legislation. tifying the foreign exchanges, and he may designate depositaries in foreign countries with which may be deposited as he may determine all or any part of the avails of [H. R. 12923.] any foreign credits or foreign currencies. AN ACT To supplement the second Liberty bond act, as amended, SEC. 5. That the subdivision (b) of section 5 of the and for other purposes. trading-with-the-encmy act be, and hereby is, amended Be it enacted by the Senate and House of Representatives to read as follows: of the United States of America in Congress assembled, That "(b)That the President may investigate, regulate, or until the expiration of two years after the date of the ter- prohibit, under such, rules and regulations as he may premination of the war between the United States and the scribe, by means of licenses or otherwise, any transactions Imperial German Government, as fixed by proclamation in foreign exchange and the export, hoarding, melting, or of the President— earmarkings of gold or silver coin or bullion or currency, (1) The interest on an amount of bonds of the fourth transfers of credit in any form (other than credits relating Liberty loan the principal of which does not exceed solely to transactions to be executed wholly within the $30,000, owned by any individual, partnership, associa- United States), and transfers of evidences of indebtedtion, or corporation, shall be exempt from graduated addi- ness or of the ownership of property between the United tional income taxes, commonly known as surtaxes, and States and any foreign country, whether enemy, ally of excess-profits and war-profits taxes, now or hereafter im- enemy, or otherwise, or between residents of one or more posed by the United States, upon the income or profits of foreign countries, by any person within the United States; individuals, partnerships, associations, or corporations; and, for the purpose of strengthening, sustaining, and (2) The interest received after January 1, 1918, on an broadening the market for bonds and certificates of indebtamount of bonds of the first Liberty loan converted, edness of the United States, of preventing frauds upon dated either November 15, 1917, or May 9, 1918, the sec- the holders thereof, and of protecting such holders, he ond Liberty loan, converted and unconverted, and the may investigate and regulate, by means of licenses or third Liberty loan, the principal of which does not exceed otherwise (until the expiration of two years after the date $45,000 in the aggregate, owned by any individual, part- of the termination of the present war with the Imperial nership, association, or corporation, shall be exempt from German Government, as fixed by his proclamation), any such taxes: Provided, however, That no owner of such bondstransactions in such bonds or certificates by or between shall be entitled to such exemption in respect to the inter- any person or persons: Provided, That nothing contained Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

962 FEDERAL RESERVE BULLETIN. OCTOBBJI 1, 1918. in this subdivision (b) shall be construed to confer any 28, 1917, the Committee of Five made a full and careful power to prohibit the purchase or sale for cash, or for notes survey of the operations of the Federal Reserve clearing eligible for discount at any Federal Reserve Bank, of and collection system. It found: bonds or certificates of indebtedness of the United States; 1. That section 13 of the Federal Reserve Act had been and he may require any person engaged in any transac- amended with the view of according to all banks the tion referred to in this subdivision to furnish, under oath, privilege of making reasonable charges, under regulations complete information relative thereto, including the pro- of the Federal Reserve Board, to cover service and expense duction of any books of account, contracts, letters, or incurred in collecting and remitting for checks presented other papers in connection therewith in the custody or through any Federaf Reserve Bank as agent. control of such person, either before or after such transac- 2. That the Federal Reserve Board had taken no steps tion is completed." to prepare a schedule of charges to be allowed to remitting SEC. 6. That section 5200 of the Revised Statutes, as banks as provided for by the amended law. amended, be, and hereby is, amended to read as follows: 3. That the Federal Reserve Banks, presumably under "SEC. 5200. The total liabilities to any association, of instructions from the Federal Reserve Board and by any person, or of any company, corporation, or firm for authority of sections 13 and 16 of the Federal Reserve Act, money borrowed, including in the liabilities of a company were making charges ranging from 1 to 2 cents per check or firm, the liabilities of the several members thereof, shall !against their respective members on checks deposited at no time exceed ten per centum of the amount of the with the Federal Reserve Banks for collection. capital stock of such association, actually paid in and 4. That the Federal Reserve clearing and collection unimpaired, and ten per centum of its unimpaired sur- system as being operated was unsatisfactory, failed to plus fund: Provided, hoivever, That (1) the discount of provide adequate facilities and by requiring a real service bills of exchange drawn in good faith against actually to be rendered without proper compensation therefor existing values, (2) the discount of commercial or business kept many eligible banks from joining the Federal Reserve paper actually owned by the person, company, corpora- system, thus preventing a unification of the banking tion, or firm, negotiating the same, and (3) the purchase or system. discount of any note or notes secured by not less than a _ MEETING OF COMMITTEE OF FIVE. like face amount cf bonds of the United States issued since j April twenty-fourth, nineteen hundred and seventeen, or | The committee held its initial meeting in Washington, certificates of indebtedness of the United States, shall not jJanuary 15, 1918, previous arrangements having been be considered as money borrowed within the meaning of made for a conference with the Federal Reserve Board on this section; but the total liabilities to any association, of the following day. any person or of any company, corporation, or firm, upon The committee had at its disposal the information accuany note or notes purchased or discounted by such, asso- mulated by the committee of 25 and the survey referred ciation and secured by such bonds or certificates of indebt- to above. After thorough consideration of all the facts it edness, shall not exceed (except to the extent permitted was decided to submit to the Federal Reserve Board for by rules and regulations prescribed by the Comptroller of its consideration a plan covering a sliding scale of per the Currency, with the approval of the Secretary of the item service charges, these charges to be based on the Treasury) ten per centum of such capital stock and surplus average amount of the check and arranged with due fund of such association." regard to the population of cities and towns and fluctuat- SEC. 7. That the short title of this act shall be "Sup- ing from nothing to 10 cents per S100. plement to second Liberty bond act." Approved September 24, 1918. CONFERENCE WITH THE FEDERAL RESERVE BOARD. A conference was held with the Federal Reserve Board January 16, 1918, the board being represented by its clearing committee: Messrs. F. A. Delano, Chas. S. Hamlin, W. P. G. Harding, and Adolph C. Miller. The Committee Report of "Committee of Five." of Five was represented by Messrs. Fred Collins, cashier, Milan Banking Co., Milan, Tenn.; M. J. Dowling, presi- Below are reprinted extracts from the report dent, Olivia State Bank, Olivia, Minn.; Thos. B. Me Adams, of the "Committee of Five" of the American chairman, vice president, Merchants' National Bank, Richmond, Va.; Thos. B. Paton, general counsel, Ameri- Bankers' Association which was originally apcan Bankers' Association; and Jerome Thralls, secretary, pointed to consider the question of domestic No. 5 Nassau Street, New York City. exchange under a resolution of September 29, The purpose and activities of the committee of 25 and 1917. The committee in question has sent its its successor, the Committee of Five, were carefully reviewed. All angles of the Federal Reserve clearing and report to all members of the association, accollection system were carefully considered and a general companied by a set of questions, designed to plan for per item service charges was outlined. ascertain the views of member banks which The representatives of the Federal Reserve Board stated receive them. The extracts from the report that it would be necessary for them to confer with the other members of the Board and get the opinion of the are reprinted for the purpose of giving readers Attorney General of the United States on certain phrases of the BULLETIN as complete a record as pos- of the law before they could give the committee a definite sible of the development of the situation affect- answer. They requested that the Committee of Five ing clearings and collections: name a subcommittee of two or three and have such subcommittee present to the Board, in writing, full details of Proceeding under instructions given by the American its plan covering a schedule of per item service charges; Bankers' Association in convention at Kansas City, Mo., also submit an opinion of the counsel of the American September 28, 1916, and Atlantic City, N. J., September Bankers' Association in support of thi3 plan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 963 PLAN OF PER ITEM SERVICE CHARGES SUBMITTED TO THE authorize and make it the duty of the Federal Reserve FEDERAL RESERVE BOARD. Board to determine "reasonable" charges, a fair interpretation of the word "reasonable" would justify the board WASHINGTON. D. C, March 12, 1918. in fixing the varying rates according to the size of the place, GENTLEMEN: In accordance with your request made at as a rate which would be reasonable for a city of 50,000 the conference held on January 1.6 between Messrs. Hard- would be unreasonable for one of 5,000, and vice versa. ing, Delano, Hamlin, and Miller of the Federal Reserve Four cents per item in towns or cities of 3,000 population Board, and members of the Committee of Five of the or less; American Bankers' Association, our committee respect- Three cents per item in towns or cities of from 3,000 to fully submits the following: 6,000 population; 1." The Federal Reserve collection system is inadequate, Two cents per item in cities with population of from and is satisfactory neither to the member nor nonmember 6,000 to 50,000; banks. It is fundamentally unsound, in so far as it One cent per item in cities with population above 50,000— attempts to build up a system of service without provid- provided no charge shall be allowed banks in cities in ing proper compensation for such service. It is not which are located a Federal Reserve Bank or branch comprehensive in that it provides for the collection of thereof; provided, further, that none of the above charges items on only about one-half of the banks of the country, as made shall exceed the maximum fixed by law, viz, 10 and it has failed to give member banks a proper collection cents per S100 or fraction thereof. service as an offset for the exchange lost through remitting Since the above schedule was suggested, an investigafor items at par. It is unpopular with a large majority of tion has been made as to the average amounts of items on the member and nonmember banks of the country in cities and towns of different population in the States of that its operations, in the final analysis, have resulted in Virginia, West Virginia, North Carolina, and South Caroadding to the profits of large jobbers, manufacturers, and lina handled through the Richmond Country Clearing merchants at the expense of the banks. It is hindering Association, from which we find: the development of the Federal Reserve system as a whole, Class 1. In cities under 3,000 the items are at present and the unification of the ban king interests of the country. averaging $60 or slightly over 16 items per §1,000. 2. The banks are entitled to reasonable compensation Class 2. From 3,000 to 6.000, the items are averaging for their services in collecting and remitting for items and from $80, or about 12 items to the §1,000. making provision for the payment of their checks at Class 3. From 6,000 to 25,000, the items are averaging points distant from their counters; it is impracticable for S98, or about 10 items to each SI,000. banks generally at this time to so educate their customers Class 4. Twenty-five to fifty thousand inhabitants, the as to require the drawer of the check to absorb these items average $202, or 5 items for each $1,000. charges, but, on the other hand, it is in accord with the We believe these figures may be taken as a fair basis for prevailing custom for these charges to be absorbed by items on towns and cities of similar size in the various the depositor of the out-of-town items, either through the sections of the country. While there may be some variamaintenance of compensating balances or by the payment tions from the above in various sections of the country and of a reasonable exchange or sendee charge. This principle different seasons of the year, we are convinced, from our has already been recognized by the Federal Reserve previous investigations,' that the amounts of the items Board in establishing a service charge in the various Fed- vary in approximately the above ratio, according to the eral Reserve Banks to cover the cost of handling items de- size of the places upon which they are drawn. It would posited therein, such charges being made against the de- seem, therefore, that a service charge of 6 cents for class 1/ positing banks rather than against the drawers of the and 4 cents for class 2 would provide revenue of approxichecks, or the banks upon which the items are drawn. mately one-tenth of 1 per cent for the small country banks 3. The collection system as now operated, by the Fed- or those located in cities and towns of 6,000 population and eral Reserve Banks has not resulted in a material reduc- less. In class 3 a charge of 2 cents per item would provide tion of clerical or other expenses of the depository banks; a revenue of about 30 cents per $1,000, while 1 cent per they are still being compelled to maintain outside ac- item for class 4 would equal 5 cents per $1,000. counts for the purpose of dealing their sundry items, not 6. The provision in the Federal Reserve Act, as origcollectible through the Federal'Reserve Banks, and to inally passed, that nothing therein contained should preemploy a large number of transit clerks for handling these vent a bank from charging its actual expenses incurred in items, including in several centers the maintenance of transactions of this character, is subject to a more liberal country clearing houses. interpretation than has been placed upon it by the Federal 4. A collection system to be successful, should be uni- Reserve Board. The Federal Reserve Board's ruling versal, and through cooperation between the Federal recognized but one of the many items of expense, viz, that Reserve Board and the American Bankers' Association, it of transportation charges upon currency. should be possible to make the collection system practi- 7. The amendments to the Federal Reserve Act, passed cally universal, provided a reasonable schedule of service in 1917, charge the Federal Reserve Board with the recharges is adopted by the board, these charges to be made sponsibility of fixing and allowing remitting banks reasonby the Federal Reserve Banks against the depositing j able compensation for their services and give the Federal banks and turned over to the remitting banks in accordance ! Reserve Board the right to fix and determine what reasonwith such regulations as the Federal Reserve Board may ! able charges shall be made by said remitting banks upon prescribe. all items received by them from any Federal Reserve In augurating this system, it is well to give consideration Bank where such Federal Reserve Bank is acting as an to the advisability of making the service charge allowances agent. The provision that no such charge shall be made as liberal as possible at the outset, to be subsequently against the Federal Reserve Banks refers only to checks modified as actual experience may dictate. and drafts which belong to the Federal Reserve Bank as 5. Since the amount of the average itemdrawnyari.es principal. * * * largely according to the population of the town or city in The Committee of Five is anxious to cooperate with the which the drawee bank is located, it was tentatively sug- Federal Reserve Board in working out a collection system gested at our conference that the following schedule of which will be fair to the public and just to the banks, and, service charges be adopted by the Federal Reserve Board: after consideration has been given to the various phases of In our opinion, through the provisions of the law which the situation covered by this plan, our committee would Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

964 FEDERAL EESERVE BULLETIN. OCTOBEK 1, 1918. be glad to arrange for a further conference with the board, il (b) Solely for purposes of exchange and collection from if desired, and to render every possible service in bringing member banks, other Federal Reserve Banks and the about a happy solution of the problem. United States, checks and drafts payable upon presenta- The committee feels, however, that the matter should tion and maturing notes and bills. not longer be left in abeyance and respectfully urges the "(c) From any nonmember bank or trust company deadoption at an early date of a schedule of reasonable posits of current funds in lawful money, national bank charges, as alcove outlined. notes, Federal Reserve notes, Federal Reserve Bank notes Respectfully submitted. and solely for purposes of exchange and collection checks and drafts payable upon presentation and maturing notes (Signed) THOS. B. MCADAJVIS, Chairman, and bills, provided such nonmember bank or trust com- JEROME THRALLS, Secretaey. pany maintains with the Federal Reserve Bank of its dis- In conclusion, the committee says: trict a balance sufficient to offset the items in transit held for its account by the Federal Reserve Bank. The Committee of Five is of the opinion that the law, "The Federal Reserve Board may by rule fix the charge as it now stands, definitely gives every bank and trust which may be imposed by each Federal Reserve Bank company in America the right to make a charge in any upon its depositors for the service of collection of checks, case"" not to exceed 10 cents per $100 or fraction thereof drafts and maturing notes and bills rendered by the based on the total of checks presented at any one time, Federal Reserve Bank, and shall determine and regulate to cover service and expense incurred in remitting for reasonable charges to be made by member and nonmember checks presented through the Federal Reserve Banks as depository banks for collection or payment of checks and agents; and further, prohibits the making of any charge drafts and remission therefor by exchange or otherwise on checks handled by the Federal Reserve Banks in the in no case to exceed 10 cents per $100 or fraction thereof, capacity of owners. based on the total of checks and drafts presented at any The committee further believes that the law imposes one time, no such charges to be made, however, against upon the Federal Reserve Board the duty of regulating the Federal Reserve Banks upon checks and drafts drawn such charges and that the Board has no legal authority to to the order of the Federal Reserve Banks or owned by the deny any bank the right to make a charge for such service the United States Government. and expense so long as the charge is within the limit fixed "The Federal Reserve Board shall make and promulby the law. It would seem that it is now clearly up to gate from time to time regulations governing the transfer the individual bank to determine as to whether it will of funds and charges therefor among Federal Reserve make a charge for the service and expense it incurs in Banks and their branches, and may at its discretion exercollecting and remitting for checks sent to it by the Fedcise the functions of a clearing house for such Federal eral Reserve Bank acting in the capacity of agent. If Reserve Banks or may designate a Federal Reserve Bank the Federal Reserve Bank seeks to deny such charges it to exercise such functions. may do so through proper legal stens only. The com- "The Federal Reserve Board pay also require each mittee believes the courts will sustain the right of any Federal Reserve Bank to exercise 'the functions of a bank to make a charge. Copy of the opinion of General clearing house for its member banks." Counsel Paton of the American Bankers' Association sustaining the views of the Committee of Five is given herewith. Even though sections J3 and 16 of the Federal Reserve Membership of State Banks and Trust Act as amended give the banks the right to compensation Companies. for service and expense involved in collecting and remitting for checks, both sections are ambiguous and confused On October 13, 1917, the President made and might, to the advantage of all concerned, be clarified. public a statement calling attention to "the Appended is a suggested amendment designed to clarify the language and remove anv possible doubt as to the importance of developing to the maximum our meaning of these sections, feoes the suggested amend- banking power and of providing machinery ment meet with your approval? And is it your desire adequate for meeting the very great financial that steps shall be taken to have it enacted into law—or requirements imposed upon our country by should legislative attempts be deferred as a matter of expediency until after the war? reason of the war.7' In the course of this statement the President said: SUGGESTED AMENDMENT. Amend the Federal Reserve Act by repealing the four- I believe that cooperation on the part of the banks is a teenth and fifteenth paragraphs of section 16 and by patriotic duty at this time and that membership in the amending and reenacting the first paragraph of section 13 Federal Reserve System is a distinct and significant evito read as foliows: dence of patriotism. * * * Permit me to urge that "Every Federal Reserve Bank shall receive on deposit every bank officer and bank director owes a solemn oblifrom member banks or from Federal Reserve Banks or gation to the country which I am sure they wish to disfrom the United States, current funds in lawful money and charge . I therefore wish again to impress upon them my Federal Reserve notes, and for collection and credit checks solemn conviction that they can best measure up to their and drafts drawn upon any of its depositors, and when duties and responsibilities through membership in the remitted by a Federal Reserve Bank for collection and Federal Reserve System. credit checks and drafts drawn by any depositor in any The accompanying tables show by districts other Federal Reserve Bank or member bank upon funds to the credit of said depositor in said reserve bank or to what extent eligible banks have availed member bank. themselves of the privilege of membership dur- "Every Federal Reserve Bank may receive— ing the 12 months following this appeal from "(a) On deposit from member banks and from the the President. It is interesting to note that, United States, Federal Reserve Bank notes and national while less than 9 per cent in the number have bank notes and for collection and credit checks and drafts payable upon presentation. become members of the system, the resources Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 965 of this small percentage represent more than It may also be noted that the resources 50 per cent of the total resources of banks re- of the Federal Reserve Banks and the number ported as eligible. This indicates that the of members have been increased to a greater larger institutions are alive to the necessity for extent during the last three months than durmobilizing our resources and unifying our bank- ing the preceding six months. The indicaing system in order to meet the increasing de- tions are that the next three months will likemands made upon our banking resources as a wise show a very decided increase in memberresult of the war. ship. TABLE 1.—Number and total resources of State banks and trust companies, members of Federal Reserve system, by districts. [Resources in thousands of dollars.! Dec. 31,1917. May 10,1918. June 29,1918. Sept.1,1918. Oct.1,1918. Federal Reserve district. Number. Resources. Number. Resources. Number. Resources. Number. Resources. Number. Resources. Boston 14 339,722 23 528,584 24 533,264 25 539,451 28 564 301 New York . -. 44 2,707,541 63 3,099,215 66 3,026,540 82 3,084,551 89 3,104,110 Philadelphia 8 228,440 16 244,336 16 244,034 20 367,053 22 371 455 ClovolEtnd 13 369,147 26 442,848 30 452,907 48 494,140 57 508,512 Richmond 14 43,804 20 60,405 20 60,313 26 81,695 31 91 263 Atlanta 20 150,656 30 180,700 38 177,031 42 200,461 45 201 672 Chicaco 71 792,425 114 878,542 128 944,596 206 1,212,651 237 1,237,411 St. Louis 13 209,694 23 266,436 24 273,186 36 299,537 36 299 537 16 27,527 35 46,899 40 47,127 53 60 180 59 6° 948 Kansas City 9 68,099 16 79,695 16 78,632 22 83,355 22 83*355 Dallas 11 11,133 43 26,694 58 31,271 87 47,316 91 49*189 San Francisco 17 65,697 40 84,392 53 125,923 66 139,020 68 139,499 Total . 250 5,013,885 449 5,938,746 513 5,994,824 713 6,609,410 785 6,713,252 TABLE 2.—Ratio of number and total resources of State banks and trust companies which have joined the Federal Reserve system to total State banks and trust companies reported as eligible for membership on basis of capital requirements. Dec. 31, 1917. May 10,1918. June 29,1918. Sept.1, 1918. Oct.1, 1918. Federal Reserve district. Number. Resources. Number. Resources. Number. Resources. Number. Resources. Number. Resources. 7.1 35.0 11.7 54.5 12.2 55.0 12.7 55.6 14.2 58 2 New York 12.4 62.1 17.7 71.8 18.5 69.4 23.0 70.7 25.0 71 2 Philadelphia 3.0 30.7 6.2 32.8 6.2 32.8 7.8 49.3 8.6 49 9 2.1 29.7 4.3 35.7 4.9 36.5 7.9 39.8 9.3 41 0 Richmond 2.7 9.8 3.9 13.5 3.9 13.4 5.0 18.2 6.0 20 3 Atlanta 2.6 33.8 4.0 40.5 5.0 39.7 5.6 44.9 6.0 45.2 3.4 32.7 5.4 36.3 6.1 39.0 9.8 50.0 11.3 51 1 St. Louis 1.3 28.7 2.3 36.4 2.4 37.4 3.7 41.0 3.7 41.0 Minneapolis 2.5 7.8 5.5 13.2 6.3 13.3 8.3 17.0 9.3 17.8 1.0 13.1 1.7 15.3 1.7 15.1 2.4 16.0 2.4 16 0 Dallas 2.3 5.4 9.0 12.8 12.2 15.0 18.3 22.7 19.1 23.6 San Francisco 2.3 6.5 5.4 8.4 7.1 12.5 9.0 13.8 9.2 13.8 Total 3.3 37.3 5.3 44.2 6.0 44.6 8.4 49.1 9.2 49.9 TABLE 3.—Number, capital stock, surplus, and total resources of State banks and trust companies members of Federal Reserve system on Oct. 1, 1918. [In thousands of dollars.] Per cent Estimated Estimated Estimated Federal Reserve district. Number. e o b l f a i g n t i o k b t s l a e . l Capital. o p e f e li t r g o c i t b a e l l n e o t f C s a u p r i p ta l l u a s n . d o p f e e li t r g o c i t b a e l l n e o t f T so o u ta r l c e re s. - o p e f e li t r g o i c t b a e l l n e o t f banks. banks. Boston 28 14.2 $25,850 43.8 $53,179 49.7 §1564,301 58.2 New York 89 25.0 112,364 66.1 264,477 67.0 3,104,110 71.2 Philadelphia 22 8.6 18,361 26.2 62,006 39.0 371,455 49.9 Cleveland 57 9.3 26,930 29.0 83,668 42.5 508,512 41.0 Richmond 31 6.0 8,907 17.5 15,093 19.4 91,263 20.3 Atlanta 45 6.0 15,165 27.6 25,034 22.8 201,672 45.2 Chicago 237 11.3 68,640 36.9 129,332 43.1 1,237,411 51.1, St. Louis 36 3.7 22,860 28.2 42,105 33.7 299,537 41.0 Minneapolis 59 9.3 5,582 15.1 7,400 13.5 62,948 17.8 Kansas City 22 2.4 4,675 10.9 7,686 13.0 83,355 16.0 Dallas 91 19.1 6,192 20.6 8,045 21.2 49,189 23.6 San Francisco 9.2 10,735 12.5 14,758 12.3 139,499 13.8 Total 785 9.2 326,261 34.0 712,783 40.9 6,713,252 49.9 83463—18 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

966 FEDEEAL BESEEVE BULLETIN. OCTOBER 1, 1918. State Banks and Trust Companies Admitted. Total Capital. Surplus. The following list shows the State banks and trust companies which have been admitted to District No. 7—Continued. membership in the Federal Keserve System Depositors State & Savings Bank, during the month of September. Chicago, 111 8300,000 $75,000 $3,113,359 Gandy State Bank, South Whitley, Seven hundred and eightv-nve State institu- In d "... 25.COO 10,500 322,135 tions are now members of the system, having a Farmers State Bank, Bargersville,Ind. 25,000 8,000 205,064 The Avoca State Bank, Avoca, Iowa.. 50,000 20,000 793,261 total capital of $326,360,807, total surplus of Commercial State Bank, Britt, Iowa.. 60,000 50,000 918,784 $386,534,881, and total resources of $6,727,- Citizens Savings Bank, Eldora, Iowa.. 50,000 15,000 Jefferson Savings Bank, Jefff<ferson, 0©0,709. Iowa 50,000 510,263 Farmers & Traders State Bank, Leon, Iowa. 100,000 5,000 798,920 Lowden Savings Bank, Lowden, Iowa 25,000 12,000 385,427 Malcom Savings Bank, Malcom, Iowa. 50,000 25,000 443,737 Capital. Surplus. Total Farmers State Bank of St. Olaf, St. Olaf, Iowa 25,000 194,065 Farmers Savings Bank, Barnes City, Iowa 25,000 8,000 371,588 District No. 1. The Home Trust & Savings Bank", Osajre, Iowa 50 000 25,000 487,189 Security Trust Co., Lynn, Mass $200,000 $200,000 $7,029,638 Ricoville State .Itank, Riceville. Towa. 25,000 10,000 212,202 Naumkeag Trust Co., Salem, Mass.... 250,000 150,000 4,670,740 Commercial State Savings Bank, Union Trust Co., Providence, R. I 1,000,000 500,000 13,148,870 Lakeview, Mich 25,000 1,000 180,750 Farmers & Merchants State Bank, District No. 2. Lakeview, Mich 25,000 5,000 242,133 Seacoast Trust Co., Asbury Park, N. J. 100,000 75,000 1,806,605 F S a ta r l m e e S r a s v S in ta g t s e B B a a n n k k , , I A on rm ia, a d M a i , c M h ich.. 1 2 0 5 0 , , 0 00 0 0 0 7,500 312,474 S B t a a y te o n B n a e n T k r C u h st a t C h o a . m , B , C ay h o a n th n a e m , , N N . . J Y .. . . 2 5 0 0 0 , ,0 0 0 0 0 0 1 5 5 0 0 , , 0 0 0 0 0 0 3 1 , , 9 5 1 8 6 2 , , 1 7 8 4 9 2 Fa C rm ar e so rs n C & it y M , e M rc ic h h ants State Bank, 25,000 100,000 1,450,846 Y Ba o n rk k v o il f l e M B il a lb n r k o , o N k, e M w i Y llb o r r o k o , k N , N . Y . Y .. . . . . . 50,000 40 5 0 0 , , 0 0 0 0 0 0 9,2 6 2 3 4 4 , , 8 8 9 5 6 0 El M k i R ch apids State Bank, Elk Rapids, 35,000 5,000 264,416 R Th o N N e c . k .Y Y l S a t n a d t e C o B u a n n t k y T o r f u s T t r C um o. a , n N s y b a u c r k g , , 2 1 2 0 0 5 0 0 , , ,0 0 0 0 0 0 0 0 0 2 1 5 5 , , 0 0 0 0 0 0 2,0 3 5 3 9 4 , , 2 4 9 3 0 1 C F T i o h M r m e s t i m c U S h e t l r a l c r t i i e a c l h B a S S n a a k v v , i n i M n g g s i s lf B o B r a d a n , n k M k , , i F c M h en o t u o n n t , 2 2 5 5 , , 0 0 0 0 0 0 1 1 6 5 0 , , , 0 0 0 0 0 0 0 0 0 3 3 4 2 8 6 0 1 1 , , , 8 9 7 1 4 3 1 6 4 Clemens, Mich 100,000 100,000 1,3 District No. S. Isabella County State Bank," Mount Pleasant, Mich 60,000 6,000 954,120 The Colonial Trust Co., Philadelphia, Traverse City State Bank, Traverse Pa 270,825 270,825 3,622,066 City, Mich 200,000 100,000 2,736,365 Am to e n r , i c P a a n Bank of Commerce, Scran- 290,356 33,470 780,379 Pl m ym ou o t u h t , h W i E s x change Bank, Ply- , 100,000 40,000 1,243,517 State Bank of Plymouth, Plymouth, District No. 4. 125,000 32,500 937,361 Lodi State Bank, Lodi, Ohio 40,000 60,000 596,297 S L t c a e t l e a n B a a u n C k o o u f n W ty a n S p a iV vi n n V g w s a B iV an pi k in , j S W ut i - s 50,000 544,536 Th s e u la P , e O ni h n i s o ula Banking Co., Penin- 25,000 4,000 213,010 tons Bay, Mich 25,000 10,000 310,516 The Home Banking Co., St. Marys, Ohio 100,000 20,000 District No. 9. Br n i a g t h i t , o O n h B io ank & Trust Co., Cincin- 200,000 200,000 5,756,047 Cl M ark in fi n eld State Bank, Clarkfield, 30,000 20,000 844,949 A St m b K a r t b y e i r d i B g dg e a e , n P k S a a & v i T ng ru s s & t C T o r . u , s R t i C ch o m ., o A n m d, - 1 1 5 2 0 5 , , 0 0 0 0 0 0 5 5 0 0 , , 0 0 0 0 0 0 1,5 9 4 8 9 1 , , 8 8 2 8 9 3 S F e i S r c s p u t r r i i n S ty g t a S V te t a a l t B l e e a y B n , a k M n k o i , n f N n S . o 7 p o r . n i . n a . n g . , . . N V .. . a . D lle a y k , . 3 2 0 5 , , 0 0 0 0 0 0 3 5 0 , , 0 0 0 0 0 0 5 30 2 2 0 , , 8 4 0 9 6 4 B Fe e F d a a e v l r e l a s r l , T P T r a u it s l t e C & o. , T B r e u a s v t er C , o P . a , Beaver 3 2 0 0 0 0 , , 0 0 0 0 0 0 1 2 0 5 0 , , 0 0 0 0 0 0 1 1 , , 5 2 0 2 5 3 , , 4 5 9 3 7 5 l F i i t S r t s . l t e D S a M ta k t i e ss B ou a r n i k , B G an le k n , w C o a o m d p C it C y r , o W ok i , s. 2 4 5 2 , , 0 0 0 0 0 0 300 2 2 9 82 8 , , 0 8 9 2 3 7 Woodlawn Trust Co., Woodlawn, Pa. 125,000 62,500, 1,658,252 La Crosse County Bank, West Salem, 30,000 7,500 519,334 District No. 5. District No. 10. Hamilton Bank, Hamilton, Md.... 26,070 8,035 239,399 A Ba m n e k r i o ca f n D T ar r l u in st g t C o o n . , , D C a h r a l r i l n o g t t t o e, n , N S . . C C . 5 1 2 0 5 0 , , 0 0 0 0 0 0 37 5 5 0 , , 0 0 0 0 0 0 4 1 , , 3 2 5 5 9 4 , , 1 2 3 2 8 8 Gu O a k r l a a nty State Bank, Okmulgee, 100,000 11,000 1,195,144 Carolina Savings Bank, Charleston, S.C 200,000 100,000 3,206,773 District No. 11. The Greensville Bank, Emporia, Va.. 50,000 60,000 508,861 Citizens State Bank, Richardson, Tex 25,000 3,000 176,464 District No. 6. First State Bank, Royse City, Tex. 35,000 15,000 :f 192,755 First State Bank, Leonard, Tex 50,000 5,000 308,830 Jackson Banking Co., Jackson, Ga..., 50,000 5,000 241,899 Farmers Bank, Winder, Ga 50,000 237,492 District No. 12. American Bank & Trust Co., Savannah, Ga 200,000 731,859 Farmers and Stockgrowers Bank, Sweet, Idaho ' 25,000 145,039 District No. 7. Peoples State Bank, Enumclaw. Wash 25,000 6,250 334,485 Capital State Savings Bank, Chicago, 200,000 20,000 1,139,955 Mercantile" Trust* & Savings Bank", NOTE.—Tho Clinton Jounty Bank & Trust Co., Frankfort, Ind., has Chicago, 111 250,000 50,000 3,320,190 decided not to complete its membership by making payment on account of capital stock, and it is therefore not a member of the Federal Reserve First State Bank of Wenona, Wenona, 50,000 35,000 532,417 system. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBBU 1, 1918. FEDERAL RESERVE BULLETIN. 967 Fiduciary Powers. Acceptances to 100 Per Cent. The applications of the following banks for Since the issue of the September BULLETIN permission to act under section 11 (k) of the the following banks have Been authorized to Federal Reserve Act have been approved since accept drafts and bills of exchange up to 100 the issue of the September BULLETIN: per cent of their capital and surplus: Fiaet & Security National Bank, Minneapolis, Minn. DISTRICT NO. 3. First National Bank, Nogales, Ariz. First National Bank, New York City. Trustee, executor, administrator, and registrar of stocks and bonds: Wyoming National Bank, Wilkes-Barre, Pa. Registrar of stocks and bonds: National Bank of Topton, Toptan, Pa. Commercial Failures Reported. DISTRICT No. 4. Trustee: With only 443 insolvencies reported to R. G. First National Bank, Grove City, Pa. Dun & Co. during three weeks of September, against 681 in the corresponding period of DISTRICT No. 9. 1917, statistics of commercial failures maintain their highly favorable showing. The state- Trustee, executor, administrator, and registrar of stocks ment for August, the latest month for which and bonds: First National Bank, Manistique, Mich. complete figures are available, discloses only 720 defaults for $7,984,760, as compared with 1,149 for $18,085,207 in August, 1917. Not only is the number of August failures the New National Bank Charters. smallest of the present year, but so few business reverses have not occurred in any previous The Comptroller of the Currency reports the month back to July, 1901, and the indebtedfollowing increases and reductions in the num- ness is the lightest of all other months since ber of national banks and the capital of na- September, 1906. Comparing with last year, tional banks during the period from August 24, the August returns show a smaller number of 1918, to September 27, 1918, inclusive: failures in all of the 12 Federal Reserve districts, except in the ninth district, where Banks. New charters issued to 24 the increase is trifling. Moreover, only in the With capital of $1, 535,000 ninth district are the liabilities larger than in Increase of capital approved for 16 August, 1917, and the expansion there of about With new capital of 2,109,000 $200,000 appears insignificant in comparison with the reductions in some other districts. Aggregate number of new charters and banks increasing capital 40 With aggregate of new capital authorized 3, 644,000 Failures during August. Number of banks liquidating .(other than those consolidating with other national banks) 2 Number. Liabilities. Capital of same banks 75,000 Number of banks reducing capital 1 Districts. Reduction of capital 150,000 1918 1917 1918 1917 Total number of banks going into liquidation or reducing capital (other than those First 86 124 $623,002 $1,498,956 consolidating with other national banks). 3 Second 105 184 1,588,169 6,668,474 Aggregate capital reduction 225,000 Third 34 52 560,510 636,050 The foregoing statement shows the aggregate of Fourth 73 91 1,225,745 3,122,756 Fifth 31 66 398,200 501,156 increased capital for the period of the banks Sixth 41 92 495,234 909,870 embraced in statement was £3,644,000 Seventh 135 165 1,342,282 1,577,130 Against this there was a reduction of capital Eighth 23 80 124,281 563,647 Ninth 38 36 374,466 171,142 owing to liquidation (other than for consoli- Tenth 20 58 184,171 450,646 dation with other national banks) and reduc- Eleventh... 46 56 298,340 344,273 tions of capital of 225,000 Twelfth.... 88 145 769,760 1,641,107 Total 720 1,149 7,984,760 18,085,207 Net increase 3,419,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

968 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Lost and Recovered Liberty Bonds. FIRST 3} PER CENT BONDS, DUE 1947—Continued. Following is a list of lost and stolen Liberty- Number. Amount. Number. Amount. Number. mount. bonds furnished this month to the American Bankers' Association. 151467.... $100 923953.... $100 53053.... $500 152233.... 100 923954.... 100 53054.... 500 If any of these bonds or coupons are pre- 158238.... 100 923955.... 100 53055.... 500 sented, banks should write, telephone, or tele- 1 1 6 6 7 7 3 34 4 1 0 . . . . . . . . 1 1 0 0 0 0 9 9 2 23 3 9 9 5 5 7 6 . . . . . . . . 1 1 0 0 0 0 5 5 3 3 0 0 5 5 6 7 . . . .. . . . 5 5 0 0 0 0 graph, collect, to L. W. Gammon, manager 167342.... 100 923958.... 100 53058.... 500 167343.... 100 923959.... 100 53059.... 500 protective department American Bankers' 167344.... 100 923960... 100 53060.... 500 Association, No. 5 Nassau Street, New York 1 1 6 6 7 7 3 3 4 4 5 5 . . . . . . . . 1 1 0 0 0 0 9 9 2 2 3 39 9 6 6 2 1 . . . . . . . . 1 1 0 0 0 0 5 5 3 3 0 0 6 6 1 2 . . . . . . . . 5 5 0 0 0 0 City. 167347.... 100 923963.... 100 63038..., 500 167349.... 100 923964.... 100 75783.... 500 183519.... 100 923965.... 100 78749.... 500 FIRST 3£ PER CENT BONDS, DUE 1917. 183520.... 100 923966.... 100 79697.... 500 222971... 100 923967.... 100 129063.. 500 223977... 100 945052.... 100 129064.. 500 Number Amount. Number. Amount. 1 Number. Amoim 2 2 2 2 S 89 9 7 7 9 8. . . . . . 1 1 0 0 0 0 9 95 5 8 4 2 7 9 9 2 7 . . . . . . . . 1 1 0 0 0 0 1 1 2 2 9 9 0 0 6 6 5 6 . . . . 5 5 0 0 0 0 228980... 100 958900.... 100 134655.. 229051... 100 972308.... 100 137264.. 1514 §50 853646 850 1434919... $50 229102... 100 972309.... 100 II147966.. 500 1515 50 863295... 50 145,7300... 50 239625... 100 1007817.. ioo |i147967.. 500 3314 50 864988... 50 1444429... 50i 243496... 100 1007818.. 100 I 150706.. 500 12252 50 865102... 50 1504830 50j 243497... 100 1022545.. 100 152233.. 500 12298 .. 872224... 50 1510602 50' 243498... 100 1022546.. 100 ! 182967.. 5Oo 72796 50 877858... 50 1525232 50 243499... 100 1022547.. 100 182968.. 500 79749 50 877859... 50 1525233 50 244119... 100 1022548.. 100 182969.. 500 129806... 50 892879... 50 1565639.... 50 318875... 100 1022549.. 100 182970.. 500 147033... 50 898951... 50 1565640.... 50 341447... 100 1042057.. 100 195760.. 500 1484.07... 50 906261... 50 1575326.... 50 368965... 100 1046426.. 100 281303.. 500 148408... 50 961108... 50 1576534.... 50 380057... 100 1050951.. 10.0 281304.. 500 148409... 50 967175... 50 1608676.... 50 380058... 100 1061774.. 100 890037.. 500 148410... 50 1005482.. 50 1622150.... 50 382392... 100 1092185.. ioo ;211955.. 1,000 148411... 50 1005483.. 50 1627474.... 50 382393... 100 1093672.. 100 I211956.. 1,000 167348... 50 1005484.. 50 1636042.... 5()I 382394... 100 1093673.. 100 211957.. 1,000 189843... 50 1007746.. 50 1644758...- 50i 460498... 100 1093674.. 100 211958.. 1,000 205165... 50 1007760.. 50 1644759..-. 50I 466882... 100 1124039.. 100 211959.. 1,000 205806... 50 1020175.. 50 1654266..-- 50 469261... 100 1124040.. 100 211960.. 1,000 205607... 50 1037960.. 50 1656725...- 50 491205... 100 1127863.. 100 211961.. 1,000 223012... 50 1093800.. 50 167S358... 50 530325... 100 1153123.. 100 212081.. 1,000 263835... 50 1097337.. 50 1758892.... 50 554598... 100 1159040.. 100 246519.. 1,000 263836... 50 1097359.. 50 1763264... 5(J 554599... 100 1159041.. 100 246520.. 1,000 272670... 50 1099949.. 50 1763265... 50 554600... 100 1169447.. 100 278697.. 1,000 277544... 50 1127288.. 50 1857639... 5u 554801... 100 1169448.. 100 278698.. 1,000 294064... 50 1182649.. 50 1914719... 50 554602... 100 1220321.. 100 278699.. 1,000 3230S2... 50 1194845.. 50 1916168... 50 567717... 100 1237133.. 100 307130.. 1,000 362865... 50 1219638.. 50 1916169.... 50 5S8500... 100 1240802.. 100 307131.. 1,000 368760... 50 1241623.. 50 1929145.... 50! 597182... 100 1240803.. 100 307132.. 1,000 371395... 50 1244581.. 50 2078030.... 50! 610430... 100 1240804.. 100 307133.. 1,000 379135... 50 1256008.. 50 2100662.... 50 610431... 100 1296569.. 100 310121.. 1,000 381229... 50 1256009.. 50 2181625... 50 634999. . 100 1305737.. 100 310122.. 1,000 381231.. - 50 1269636.. 50 2844811... 50 675887... 100 1378897.. 100 362255.. 1,000 381232... 50 1269637.. 50 2850688.... 50 675888... 100 1379f>98.. 100 382236.. 1,000 381233... 50 1270924.. 50 3125901... 50 675S89... 100 1379769.. 100 446311.. 1,000 381241... 50 1305737.. 50 3125902.... 50 675890... 100 1381626.. 100 634114.. 1,000 398607... 50 1325485.. 50 3125903... 50 675891... 100 1698662.. 100 634115.. 1,000 412084... 50 1353601.. 50 3889674.... 50 675907... 100 2589616.. 100 634116.. 1,000 412285 -. - 50 1360660.. 50 3865431.... 50 675908... 100 2589617.. 100 634117.. 1,000 460124:.. 50 1360601... 50 3865432... 50 675909... 100 2589618.. 100 634118.. 1,000 465493... 50 |1360662.. 50 4961859... 50 675910... 100 24801.... 500 634119.. 1,000 474746... 50 1360663.. 50 2136 100 675011... 100 24802.... 500 634120.. 1,000 478872... 50 1360664.. 50 2186 100! 695104... 100 24803.... 500 634121.. 1,000 483400... 50 1373761 50 10717 100 695996... 100 24804.... 500 634122.. 1,000 536892... 50 1385689.. 50 10718 100• 695997... 100 24805.... 500 634123.. 1,000 540836... 50 1385690.. 50 12298 100 695998... 100 24806.... 500 634124.. 1,000 562865... 50 1385691 50 28414 100: 710786... 100 24807.... 500 634125.. 1,000 569644... 50 1385692.. 50 28415 100 748389... 100 24808.... 500 634126.. 1,000 569645... 50 1385693.. 50 28416 100 748390... 100 24809.... 500 634127.. 1,000 569646... 50 11385694.. 50 91270 100• 749740... 100 24810.... 500 634128.. 1,000 627573... 50 :1385695.. 50 109664.... 100 755458... 100 24811.... 500 634129.. 1,000 634144... 50 1385696.. 50 112341.... 100 785414... 100 •24812.... 500 634130.. 1,000 652781... 50 .1385897.. 50 116029.... 100 79513;)... 100 24813.... 500 634131.. 1,000 659581... 50 i1385898.. 50 116030.... 100 832036... 100 24814.... 500 634132.. 1,000 690135... 50 i 1385699.. 50 117486.... 100 847794... 100 24815.... 500 634133.. 1,000 697272... 50 i 1385700.. 50 117487.... 100: 853433... 100 24816.... 500 639811.. 1,000 697273... 50 !1385701.. 50 117488.... 100 865511... 100 24817.... 500 639812.. 1,000 726682... 50 !1385702.. 50 117*489.... 100 100 24818.... 500 639813.. 1,000 738138... 50 !1385703.. 50 117490.... 100; 892027... 100 24819.... 500 639814. 1,000 741762... 50 |1385704.. 50 117518.... 100 8Q2042... 100 24820.... 500 639815. 1,000 741763... 50 i1385705.. 50 117519.... 100! 905958... 100 24821.... 500 639816. 1,000 768228... 50 i 1385706.. 50 140140.... 100i 918644... 100 24822.... 500 639817. 1,000 807579... 50 !1385707.. 50 140141.... 100i 923948... 100 24823.... 500 639818. 1,000 812056... 50 I1385708.. 50 140142.... 100, ! 923949... 100 35582.... 500 1,000 812057... 50 1385709.. 50 140143.... 100I ; 923950.. 100 35583.... 500 639820... 1.000 812058... 50 1404562.. 50 140144.... 100I | 923951... 100 42187.... 500 812059... 50 1410410.. 50 140833.... 100 923952.. 100 500 833422... 50 1425045.. 50 150449.... 100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

969 OCTOBER 1,1918. FEDERAL EESERVE BULLETIN. FIRST 4 PER CENT CONVERTED BONDS, DUE 1947. SECOND 4 PER CENT BONDS, DUE 1942—Continued. Number Amount. Number. Amount. Number. Amount. Number. Amount. Number. Amount. 28150. $50 1034646 §50 1027758.... 550 2061051 S50 199541....- $100 46532. 50 1142219 50 1027759.... 50 2061052 50 250378 100 57931. 50 1147418 50 1027760.... 50 2128501 50 279846.. 100 65979. 50 .1147419 50 1027761.... 50 2150140 50 358428.. 100 133460. 50j 1167375 50 1094269 50 2L95695 50 3889J3.. 100 133461, 50 |1191981 50 1109200.... 50 2205092 50 586570.. 100 145824. 50 i1191982 50 1113852.... 50 2205093 50 586571 100 171375 50 |1219638 50 1126691.... 50 2205096 50 659006 100 212066 50 127(5590 50 1126602 .. 50 2205097 50 659067 100 233460 50 I!1354376 50 1147031 50 2214922 50 760266 100 303338 50 I"1357013 50 1180512 50 2254355 50 1035539.... 100 350797 50 |1386087 50 120:5665.... 50 2301446 50 1102485 100 39499.5. 50 1386088 50 1209460.... 50 2385148 50 1183982 100 406382 50 1386089 50 1238372.... 50 2411548 50 1308321 100 418448 50 1472635 50 12-10236.... 50 2411549 50 1308334.... 100 605202 50 1508624 50 1240237.... 50 2411558 50 1361960 100 50 1611511 50 1243279 50 2411953 50 1436402 100 717285. 50 1620216.... 50 1279243 50 2411954 50 1436403 100 735974. 50 1626211 50 1284626 50 2411955 50 1548675 100 735975. 50 1841114 50 786881. 1305737 50 2440721 50 17201SI 100 768278. 50 1859417 50 801942. 1312334 50 2440722 50 1806059 100 770449. 50 1874702 50 801943. 1313270 50 2441308 50 1877624 100 795482. 50 1881134 50 801944. 1313271 50 2441309 50 1877630.... 100 822990. 50 1942306 50 1084586 1318883 50 2441548 50 2010738.... 100 876917. 50 1942307 50 1261309 1319000 50 2471808 50 2010739 100 876918. 50 1950218 50 49157.. 1325133 50 2651093 50 2282210 100 876919. 50 1939916 50 72314.. 1325134 50 2651094 50 22S2211 100 876920. 50 3482287 50 88486.. 1325135 50 2720086 50 2282212.... 100 876921. 50 3482288 50 95553.. 1325901 50 2733475 50 2589616 100 50 3482289 50 131414. 1325902 50 2814847 50 2589617 100 876923. 50 6967697 50 180105. 1325903 50 2850688 50 2589618 100 876924. 50 57931 ... 100 62244.. 1381101 50 3150387 50 261.9119. 100 50 325682 100 139196. 1381102 50 3357912 50 2643073. 100 50 139195 100 139197. 1381103 50 3357913 50 2704.446. 100 876927... 50 152252 100 139198. 1411285 50 3357914 50 2798846. 100 876928... 50 215986 100 139199. 1421007 50 3482287 50 3083S04.. 100 921025... 50 215987 100 139200. 1421130 50 3482288 50 3216177. 100 921027... 50 215988 100 139201. 1425300 50 3482280 50 3216178.. 100 962965... 50 224568 •100 139202. 1512035 50 3570042 50 3283978.. 100 967169... 50 283444 100 1512036 50 3723034 50 3500657.. 100 1012451... 50 333776 100 1541313 50 3956431 50 3500658.. 100 1563007 50 3973390 50 3500659.. 100 1577015 50 4090132 50 3500660.. 100 SECOND 4 PER CENT BONDS, DUE 1942. 1629363 50 4090133 50 3540750.. 100 1629364 50 4132527 50 3606564.. 100 II 1629365 50 4368428 50 36S8102.. 100 11332... $50 355755 $50 638855.. §50 1629366 50 4598053 50 4286951.. 100 12415... 50 370442 50 639857.. 50 1629367 50 5207184 50 4290320..'.". 100 17459... 50 382543 50 640352.. 50 1666881 50 5207982 50 4290321 100 17460... 50 i382544 50 652721.. 50 1670473 50 5256644 50 4290322 100 20712... 50 !391959 50 678280.. 50 1771975 50 5256653 50 4290323 100 24858... 50 |434160 50 716594.. 50 1771976 50 5346115 50! 10267 • 500 79787... 50 I435964 | 50 734318.. 50 1801893 50 5375344 50j 10268 500 97432... 50 435965 j 50 734319.. 50 1801894 50 5401134 501 10269 500 99126... 50 !436395 1 50 734320.. 50 1820013 50 5401135 50! 10270.. 500 99127... 50 442746 50 734321.. 50 1821915 50 5465468 50 133673 500 101894.. 50 483424 50 734322.. 50 1823789 50 5743716 50: 321196.. 500 111172.. 50 483425 50 744074.. 50 1825985 50 5743717 50 381465.. 500 116889.. 50 490902. 50 764788.. 50 1847685 50 5743718 50 381466.. !!i 500 1 1 2 2 4 5 3 5 5 7 0 1 . . . . 5 50 0 • : 4 50 9 8 4 7 4 7 7 7 3 . . 5 5 0 0 7 7 6 6 1 7 7 9 8 8 9 6 . . . . 5 5 0 0 1 1 8 8 5 5 5 5 6 6 3 3 7 8 5 5 0 0 6 5 6 74 8 3 4 7 9 1 1 9 7 5 5 0 0 3 3 8 8 1 1 4 4 6 68 7 . . . . ..; o 5 o 0 o 0 149377.. 50 525086. 50 790015.. 50 1862757 50 6799402 50 435407.. 500 157140.. 50 525769. 50 793709.. 50 1871956 50 7475844 50 435408.. I'. 500 157617.. 50 530081. 50 793710.. 50 1881927 50 7626011 50 435409 500 157625.. 50 541860. 50 793711.. 50 1912023 50 99313 100 444021 500 160400.. 50 551116. 50 798293.. 50 1913188 .50 116872 100 474766 500 162719.. 50 551812. 50 798299.. 50 1955565 50 116873 100 605919 500 1 2 2 2 2 2 9 0 1 2 5 4 8 0 1 9 0 U 5 6 1 6 1 9 7 1 0 4 6 8 9 2 0 6 0 . . . . . . . . . . . . 5 5 5 5 5 5 0 0 0 0 0 0 : j 5 5 5 5 5 5 5 5 5 5 5 5 1 1 1 1 1 1 8 8 8 8 8 8 1 1 1 1 1 1 3 4 6 7 8 5 . . 5 5 5 5 5 5 0 0 0 0 0 0 8 8 8 8 8 8 0 0 0 4 0 0 0 6 6 4 5 6 2 8 6 9 0 7 2 1 7 3 7 3 1 1 4 0 5 9 . . . . . . . . . . . . 5 5 5 5 5 5 0 0 0 0 0 0 2 2 2 1 2 2 0 0 0 9 0 0 5 5 0 6 4 5 6 5 6 8 1 5 1 5 4 8 0 5 6 6 0 9 5 1 1 6 5 6 0 0 5 5 5 5 5 5 0 0 0 0 0 0 1 1 1 1 1 1 1 9 1 1 1 1 6 9 6 6 6 6 8 5 8 8 8 8 7 4 7 7 7 7 5 0 4 7 6 8 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 i ! 9 1 1 1 0 6 3 3 8 0 0 0 4 5 4 4 3 3 0 0 6 5 3 5 3 3 4 i 1 1 , , 1 1 , , 0 0 0 0 0 0 0 0 0 0 0 0 256818.. 50 551819 50 844931.. 50 261512.. 50 551820 50 844932.. 50 261513.. 50 551821 50 844933.. 50 THIRD 4J PER CENT BONDS, DUE 1928. 261514.. 50 553889 50 844934.. 50 288030.. 50 559157 50 844935.. 50 288094.. 50 560836 50 844936.. 50 14488.... 550 633583 $50 1222427... 293538.. 50 587493 50 874496.. 50 263166... 50 656194 50 1222428... 294546.. 50 571745 50 937730.. 50 50 705913 50 1286366... 294547.. 50 578468 ! 50 937731.. 50 293982... 50 705914 50 1479123... 294548.. 50 580939 50 981.837.. 50 326240... 50 835407 50 : 1485531... 326070.. 50 600196 50 1011332. 50 456590... 50 835408 50; 1507276... 326071.. 50 620221 50 1020748. 50 456603... 50 1222424 50 1541238... 329113.. 50 620223 50 1025190. 50 456604... 50 1222425 50 1680124... 340441.. ..I 50 627038 50 1027757. 50 552005... 50 1222426 50: 1771894... Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

970 FEDERAL RESERVE BULLETIN. OCTOBEB 1, 1918. THIRD 4J PER CENT BONDS, DUE 1928—Continued. Below is a list of lost and stolen Liberty bonds, which have been recovered and re- Number. Amount. Number. Amount. Number. Amount. turned to their proper owners: FIRST 3& PER CENT BONDS DUE 1947. 1771895 $50 7822592 $50 3975532.. $100 1777759 50 8201450 50 4121174.. 100 1777760 50 8459339 50 4934226.. 100 Number. Amount. Number. Amount. Number. Amount. 1936612 50 -,8789067 50 4934227.. 100 1936613 50 9270011 50 4934228.. 100 2001037 50 i9934918 50 4934229.., 100 148407 $50 263835 $50 3865431.... $50 2255570 50 129400 100 4982708.. 100 148408 50 263836 50 10717 100 2682961 50 118315 100 4982709.. 100 ! 148409 . 50 478872 50 109664 100 2682962 50 ; 148316 . 100 5017028.. 100 I 148410 50 807579 50 151467 ... 100 2826966 50 289207 100 100 | 148411 50 1654266 50 890037 500 2826967 50 1196318 100| 6491027... 100 I. 2988021 50 1196319 100 6570831... 100 i 3073529 50 1196320 100 6570S32... 100 [FIRST 4 PER CENT BONDS CONVERTED DUE 1947. 3077085 50 1196321 100 6570834... 100 3091776 50 1196322 100 6570839... 100 876917 $50 3116809 50 1219970 100 86821 500 876918 3124928 50 1339758 100 111061.... 500 876923 3181009 50 1352460 100 142837.... 500 876924 3223613 50 1355982 100 198835.... 500 3223614 50 1413665 100 ! 198839.... 500 3382137 50 158(5009 100 198882.... 500 3251153 50 1586010 100 205118.... 500 3571458 50 1665709 100 260818.... 500 3590794 50 1665710 100 285718.... 500 4096557 50 1795514 100 336392.... 500 5167038 50 1843195 100 664421.... 500 5314393 50 1926693 100 706462.... 500 6147896 50 2006013 100 74386.. 1,000 6161331 50 2239152 100 85875.. 1,000 6198361 50 2239153 100 335256 1,000 6309358 50 2420726 100 356958 1,000 6341699 50 2527873 100 480726..., 1,000 6341700-... 50 2677878 100 480727.... 1,000 6492806.... 50 2815S37 100 946486..., 1,000 7400551.... 50 3016364. 100 919732... 1,000 7729125.... 50 3016365 100 1306178.. 1,000 ggg 876925 350 876926 876927.. 876928 ggg 921026.. .. $50 921027 50 1611511 50 1979916 50 SECOND 4 PER CENT BONDS DUE 1942. 1577015.... $50 3150387 $50 279846 $100 1629363.... • 50 3723034 50 586570 100 1629364.... 50 4132527.... 50 586571 100 1629365.... 50 6799402.... 50 1806059 100 1629366.... 50 7475844.... 50 2704446 100 1629367.... 50 99313 .... 100 474766 500 2254355.... 50 250378 100 THIRD 4i PER CENT BONDS DUE 1928. 3382137 $50 1586010 ! $100 $500 3198361 50 2239152 1 100 1586009 100 2239153 1 100 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. PEDEBAL RESERVE BULLETIN. 971 INFORMAL RULINGS OF THE BOARD. Below are reproduced letters sent out from Trade acceptance. (To an individual.) time to time over the signatures of the officers Your letter of August 27, requesting certain or members of the Federal Reserve Board information in regard to trade acceptances, has which contain information believed to be of been received. general interest to Federal Reserve Banks and The first question submitted by you reads member banks of the system: as follows: "When the trade acceptance has been accepted by the person on whom it is drawn, Eligibility of farmers' notes given for purchase of silos. does it become an order on the bank at which (To an individual.) it is payable to pay the amount involved at maturity date, or does it merely authorize the Referring to your letter of the 12th instant, bank to make payment if it so desires ?" inquiring as to the eligibility for rediscount of Section 87 of the negotiable instruments act farmers' notes given for the purchase of silos, reads as follows: I wish to advise that in the opinion of the " Where the instrument is made payable at Board silos are considered to be permanent or a bank it is equivalent to an order to the bank fixed improvements, and it would require a to pay the same for the account of the prinforced construction of the act to treat paper cipal debtor thereon." of this kind as eligible for rediscount as agri- The negotiable instruments law has been cultural paper. adopted in all of the States of the Union except SEPTEMBER 21, 1918. California, Georgia, Maine, Mississippi, and Texas, but in Illinois, Nebraska, and South Dakota this section was omitted, and in Minnesota the word "not" is interpolated, so that Eligibility of chain of banks for membership. the section reads " shall not be equivalent, (To aSFedoral Roserve agent.) etc." In Illinois it has been held that when a note is made payable at a particular bank or Receipt is acknowledged of your letter of the banker's, the bank or banker has no authority 15th, inclosing letter from the vice president of to apply the funds of the maker to pay the the Bank, in which the following quesnote at maturity without being so ordered by tion is submitted for a ruling: him verbally or by check or draft or other " Would a chain of banks having a capital of writing, although the maker may have funds say, $100,000 be eligible for membership, and there on deposit sufficient to pay it. (Wood v. this membership extend to all its branches, or Merchants Savings, etc., Co., 41 111., 247.) would it be necessary to have sufficient capital Your letter also raises the question whether to cover the membership in each town as reyou would be permitted to discount a trade quired by an individual bank?" acceptance having a definite maturity of one In reply you are advised that counsel is of year made to cover certain machines bought the opinion that if each bank composing the from you and which the purchaser found neceschain referred to is a separate corporation, it sary to carry over to the next season. You will be necessary for each to file separate appliare advised that neither notes nor acceptances cation and to have sufficient capital to entitle having maturity in excess of 90 days can be it to become a national bank in the place in discounted with Federal Reserve Banks. which its business is conducted. On the other hand, if there is one corporation, with branches SEPTEMBER 9, 1918. in other cities or towns, it will be sufficient if the capital of the parent bank is sufficient to Custody of shipping documents or warehouse receipts. entitle it to become a national bank in the place (From and to an individual.) in which its head office is located. Section 13 of the Federal Reserve act pro- AUGUST 23, 1918. vides in part that "any member bank may Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

972 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. accept drafts * * * drawn upon it * * * Revenue stamps on drafts drawn to finance sales of which grow out of transactions involving the goods to Allied Purchasing Commission. fH domestic shipment of goods, provided shipping |(To;;Federal^eserve Banks.) 1 j documents conveying or securing title are attached at the time of acceptance." The Board's attention has been called to the A depositor of this bank purchases from fact that in some districts banks are requiring time to time cotton seed at various points in revenue stamps to be affixed to drafts drawn the South and at the time of purchase orders to finance sales of goods to the Allied Purchasshipment to his mills in that section. He ing Commission, while in others this requiredesires to finance these shipments by accept- ment is not enforced by the banks. ances to be drawn on us under the above sec- It is, of course, desirable that the practice tion of the Federal Reserve act. On account should be uniform. Attention is, therefore, of the location of the mills, it is not feasible to called to the ruling of the Commissioner of send the bills of lading to New York City and Internal Revenue, published on page 614 of have them returned in time to obtain timely the July, 1918, BULLETIN, which reads •' as delivery of the goods. follows : Our client suggests that he will hand the bills of lading, on the day the draft is pre- Referring to your letter of June 5 and my acknowledgment of June 10, it seems from Mr. Curtis's letter that under sented to us for acceptance, to our correcredit agreements conforming with the regulations of the spondent in the South, who would certify to Federal Reserve Board packers may draw bills of exchange us by letter or telegram that they are holding on domestic banks against sales of goods to the Allied such bills of lading for our account. Purchasing Commission, such bills running for a period of time covering approximately the transit of the shipment This seems to comply with the spirit of the from the interior point to the seaboard, where the goods law, but we would like the ruling of the Federal are taken on board ship for the ocean voyage at the con- Reserve Board before undertaking this business. venience of the Allied Purchasing Commission. In Win. E. Peck & Co. (Inc.) v. Lowe, decided in the SEPTEMBER 7, 1918. United States Supreme Court May 20, 1918, which held that the income tax of 1913 was valid as applied to net Your letter of the 7th instant was duly re- income derived from sales in foreign commerce, the court has occasion to discuss the effect of the constitutional ceived and the question raised was referred to prohibition against taxing articles exported, and it recounsel, with whom the Board agrees in the ferred to and distinguished certain of its former decisions opinion that "it is entirely consistent with the on the subject. It concluded that when the tax is not purposes of the act and a sufficient compliance laid on the articles themselves while in course of exportation the true test of its validity is whether it so directly with its terms if shipping documents are in and closely bears on the process of exporting as to be in the possession of the bank and the bank has a substance a tax on the exportation. In the present cirlien on the property represented by such docu- cumstances it can probably fairly be said that the tax on ments at the time that such bill is accepted. the drafts, although they are to be paid before the actual ocean voyage begins, bears so directly and closely on the If placed in the possession of the bank's agent process of exporting as to be in substance a tax on it. and under the control of the bank such docu- The goods are doubtless "in course of exportation" from ments could clearly be considered as in the the time the first carrier receives them. possession of the bank. * * * There would The same principle would seem to apply as in the case of the transportation tax. In article 31 of Regulations seem to be no greater reason for requiring ship- No. 42 rules for determining when property may be ping documents or warehouse receipts to be deemed to be in the course of exportation are laid down, physically attached or fastened to the bill than and apparently the present situation is within their scope. there is for requiring other documents securing It is accordingly held that the stamp tax imposed by such bill to be attached or fastened.7' Care subdivision 6 of schedule A of Title VIII of the act of October 3, 1917, does not attach to drafts on domestic should, however, be taken that the documents banks in connection with the shipment of articles from be held for account of the accepting bank by the interior to the seaboard, where such articles have been a third party who is in no way interested in the sold to the United States agent of a foreign purchaser for export under circumstances entitling the transportation acceptance transaction. A trust receipt of the within the United States to exemption from the transparty for whom the acceptance is made would portation tax. not be looked upon with favor by the Board. SEPTEMBER 16, 1918. SEPTEMBER 19, 1917. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1, 1918. FEDERAL RESERVE BULLETIN. 973 RULINGS OF THE DIVISION OP FOREIGN EXCHANGE. Following are formal and informal rulings $5,000, customs authorities have been requested to advise made by the Federal Reserve Board, Divi- the Federal Reserve Bank of their district, in writing, the names of the beneficiaries and the banks issuing the sion of Foreign Exchange, under Executive credits. Order of January 26, 1918, and subsequent APRIL 25, 1918. to the issuance of "Instructions to Dealers77 Securities purchased in the open market. of January 26, 1918. The terms "person," In the case of securities purchased by dealers in the open "dealer/7 "correspondent,'7 "customer,77 and market in the United States since February 20, 1918, for such other terms as have a special meaning, are account of their foreign correspondents, Form F. E. 113 used in these rulings as prescribed in the need not be executed in connection therewith unless otherwise instructed, provided such foreign correspondents Executive Order above. have signed Form F. E. 114. Cotton brokers. MAY 22, 1918. Cotton brokers do not require registration certificate? Shipment of securities from the United States. unless they carry balances abroad or carry balances in Dealers shipping securities out of the country should this country for foreign correspondents. imprint their censorship stamp on the package containing Cotton brokers who may be carrying small balances on the securities when sent t by mail or express. No special their books with foreign correspondents to provide for license from a Federal Reserve Bank ia required in this slight variations in shipping and receiving weights, until connection, but proper declarations on Form F. E. 113 otherwise instructed need not take out registration cer- should be forwarded to the Division of Foreign Exchange, tificates, provided such balances are not used to check Federal Reserve Board, 15 Wall Street, New York City, with a report showing the changes in securities held. MARCH 14, 1918. j Persons not holding registration certificates who desire to send securities out of the United States, must advise Transactions in foreign exchange by banks through the Federal Reserve Bank in their district of the detail of domestic correspondents. the transaction, and must accompany such advice with Banking institutions which come under this heading will declaration on Form F. E. 113, and must obtain from the be obliged to take out class A registration certificates, but Federal Reserve Bank a license authorizing the shipment. will not be required to make reports to the Federal Re- In all cases where shipments of securities do not bear serve Board, until otherwise instructed. the imprint of the U. S. F. R. B. stamp, customs officers FEBRUARY 11, 1918. and post-office officials are instructed to require special Banks which do all of their foreign exchange business licenses from a Federal Reserve Bank. through their domestic correspondents, and do not draw MAY 25, 1918. foreign exchange against the accounts of such correspond- Foreign exchange credits. ents, are customers. Until otherwise instructed, foreign correspondents MARCH 29, 1918. which have filed declarations on Form F. E. 114, when Foreign dividend checks. drawing drafts directly upon, or making deposits directly with, a dealer in the United States, are not required to Beneficiaries of foreign dividend checks are obliged to file information otherwise required with foreign exchange execute the regular customers' statement when depositcredits. ing such checks with their banks in the United States. The order with regard to credits from foreign correspond- APRIL 2, 1918. ents is particularly aimed to cover transactions made Travelers carrying letters of credit and travelers' checks. through third parties, and does not refer at all to checks Travelers leaving the country and carrying upon their which may be drawn against deposit accounts, except porson or in their baggage travelers' checks and letters when such checks are themselves used as a means of credit of credit are not required by the customs authorities to to another foreign account. have special licenses. When such letters of credit exceed JULY 6, 1918. 83463—18 8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

974 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. LAW DEPARTMENT. The following opinions of counsel have been In the case under consideration, however, if the railroad company, as the purchaser of a authorized for publication by the Board since commodity, accepts the draft of the seller and the last edition of the BULLETIN : the seller or a third party to whom the draft is sold in good faith discounts it with a member Rediscount of draft for railroad supplies. bank, such a draft would seem to comply with Where a railroad company purchasing supplies accepts the regulations of the Board defining trade the draft of the seller and the seller or a third party to acceptances and would be eligible for rediswhom the draft is sold in good faith discounts it with a count with a Federal Reserve Bank. member bank, such draft is eligible for rediscount with a Respectfully, Federal Reserve Bank. M. C. ELLIOTT, Counsel. AUGUST 14, 1918. To Hon. W. P. G. HARDING, SIR: This office has been requested to con- Governor, Federal Reserve Board. sider the question whether a draft drawn by a railroad company for the purchase price of supplies or other material and accepted by the railroad company may be discounted as a Trade acceptances as bills of exchange drawn against trade acceptance by a member bank, and actually existing values. whether such acceptance would be eligible for A trade acceptance may or may not be classified as a rediscount with a Federal Reserve Bank. bill of exchange drawn against actually existing values. National banks are authorized under section The distinction is not important in so far as the limita- 5136, "Revised Statutes, to discount and negotions of section 5200 are concerned, since such a trade actiate "promissory notes, drafts, bills of ceptance negotiated in good faith by the bona fide owner exchange and other evidence of debt.7' would be exempt from the limitations of section 5200 as There would seem to be no question, there- "commercial or business paper actually owned by the fore, of the right of a national bank to discount person negotiating the same,'' even if it is not exempt as such an acceptance as a bill of exchange or a "bill of exchange drawn in good faith against actually evidence of debt. Whether or not such an existing values." acceptance would be eligible for rediscount Section 13 of the Federal Reserve Act, however, limits under the provisions of section 13 of the Federal the amount of paper of any one borrower rediscounted for Reserve Act would depend upon whether the any one bank to ]0 per cent of such bank's capital and proceeds of the discount were to be used for surplus; and trade acceptances axe subject to this limitaan agricultural, industrial, or commercial pur- tion, unless they can be classified as "bills of exchange pose/ This would seem to depend upon drawn against actually existing values." whether the acceptance is discounted by the Bills drawn by the seller against the purchaser and acacceptor or by the bona fide owner. If discepted before the sale or delivery of the goods should not counted by the acceptor, the railroad combe treated as bills drawn against actually existing values, pany, it would constitute a direct loan to the since such goods are not in the possession of the drawee railroad company, and the question would either in the original form or in the shape of the proceedsthen arise whether the railroad company had of their sale; except where the goods have passed out of used the proceeds for a commercial purpose, or the possession of the drawer and have been placed in storfor permanent or fixed investmentsf In a age subject to the control or order of the drawee. broad general sense the use of the proceeds to purchase supplies might be said to constitute AUGUST 21, 1918. a commercial purpose, but if this test should SIR: In the accompanying letter it is stated be adopted paper which does not conform to the that in a recent issue of the BULLETIN there apregulations of the Board might be treated as peared the following ruling: eligible. To illustrate by an extreme case, the "Only those trade acceptances which are customer of a bank might execute his note drawn at the time of, or within a reasonable using the proceeds to purchase a house and time after, the shipment or delivery of goods this purchase might be treated as a commercial sold can be treated as bills of exchange drawn transaction. It is, of course, obvious that against actually existing values." such an interpretation is not consistent with I have not been able to locate this exact the spirit and purposes of the act. language in the ruling of the Board, but in sub- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 975 stance it is in accord with an opinion approved ! The distinction is not important in so far as by the Board and published on page 195 of the | the limitations of section 5200 are concerned, March, 1917, BULLETIN. * | since such a trade acceptance negotiated in In this opinion the conclusion is reached i good faith by the bona fide owner would be that "An accepted bill of exchange unaccom- \ exempt from the limitations of section 5200 panied by shipping documents or other such ' as "commercial or business paper actually papers, may be considered as drawn against j owned by the person negotiating the same," actually existing values, if drawn against the even if it were not exempt as a "bill of exdrawee at the time of, or within a reasonable change drawn in good faith against actually time after, the shipment or delivery of the existing value.55 goods sold." ! Of course, if such an acceptance were dis- In this latter case there must be reasonable ; counted by the acceptor and not by the owner, grounds to believe that the goods are in exist- j it would be subject to the limitations of secence in the hands of the drawee either in their ! tion 5200, since in that case the loan would original form or in the shape of the proceeds of; be made to the party primarily liable on the their sale. j bill and not to the owner of the bill. It appears from the accompanying letter that The distinction in question becomes importhe significance and purpose of this ruling has tant, however, when such trade acceptances apparently been misunderstood by some of ! are offered for rediscount to a Federal Reserve those interested in the development of the trade : Bank. Section 13, Federal Eeserve Act, proacceptance and some confusion of thought seems j vides in part that— to have developed as to the distinction between j ; notes and bills bearing the signa- The aggi gate of Sl]ch a trade acceptance, withm the meaning ot j ture or indorsement of any one borrower, whether a person, in the meaning of section 5200, Revised Statshall not apply to the discount of bills of exchange drawn utes, and section 13 of the Federal Eeserve Act. in good faith against'actually existing value. this limitation, and unless a trade acceptance contains the following proviso: offered for rediscount could be classified as a But the discount of bills of exchange drawn in good "bill of exchange drawn against actually existfaith against actually existing values, and the discount of ing value" it would necessarily be subject to commercial or business paper actually owned by the this limitation. person negotiating the same, shall not be considered as money borrowed. The question has also been raised whether A trade acceptance may or may not be das- : billf drawn by the seller against the purchaser sified as a bill of exchange drawn against ac- ! ana accepted before the sale or delivery of the tually existing value. ~ i goods may be treated as bills drawn against If "it'is drawn at the time of or within a ! actually exis ting value. reasonable time after the sale and delivery of ln the opinion of tms office, such bills should the goods, when there is reason to believe not be so treated, since tne goods are not in the that the goods are in the possession of the pur- possession of the drawee, either m the original chaser, either in their original form or in the form or m tl\e shape of the proceeds of sale of shape of the proceeds of sale, it may be treated sucb goods. as a bill of exchange drawn against actually j The seller nas not in such case furnished to *ne purchaser the value out of winch the draft exiissttiinngg vvaalluuee.. p b id t t it On the other hand, if a bill is drawn for the . may be paid at maturity. purchase price of goods sold, in order to con- ifferent situation would, of course, be prevert a balance carried on open account into a sented it the goods had passed out ot the negotiable instrument, such a bin, when ac- i possession of the drawer and had been placed cepted, might comply with the Board's defini- j in storage subject to the control or order of the tion of a trade acceptance, but could not be \ drawee, treated as bill of exchange drawn against i Kespecttully, existing value, unless drawn within a reason- M. C. ELLIOTT,^Counsel. able time after the sale and delivery of the To Hon. W. P. G. HARDING, goods. Governor, Federal Reserve Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

976 FEDERAL RESERVE BULLETIN. OCTOBEB 1, 1918. Acceptance of drafts of Food Administration Grain Cor- should be placed in the custody of some perporation. son, firm, or corporation other than the borrower. This regulation has been and should The Federal Keserve Board has authority to permit be consistently enforced. If, therefore, the member banks to accept drafts of the Food Administration plan of the Food Administration Corporation Grain Corporation secured by some form of receipt or notais to be tentatively approved by the Board, it tion on the draft itself, signed by a trustee holding wareshould be made clear that the custodian house receipts covering grain stored in warehouses, identiholding the collateral can not release such fying it as a draft secured by the grain stored. collateral to the grain corporation except when SEPTEMBER 16, 1918. other satisfactory collateral is substituted, and SIR: From the accompanying letter it ap- that the food corporation can not exercise pears that the Food Administration Grain Cor- control over the grain while it is in storage. poration proposes to purchase large quantities Respectfully, of this year's crop of grain and to store a con- M. C. ELLIOTT, Counsel. siderable portion of their purchases in various To Hon. W. P. G. HARDING, grain elevators or warehouses, one of the main Governor, Federal Reserve Board. objects being to conserve from this year's crop a surplus against a possible shortage next year. The corporation desires to finance this grain in part by means of bankers' acceptances and Drafts growing out of transactions involving the imporhas asked for a ruling of the Board on the eligi- tation or exportation of goods. bility of acceptances made by banks under the Drafts drawn under an agreement whereby the drawer following conditions: agrees to manufacture and import into the United States 1. If the accepting, bank is not secured by in time to meet the maturity of such drafts certain products a warehouse receipt or other such document which shall have been sold by the shipper and are to be conveying or securing title to the grain. ready for immediate delivery and consigned to a firm of 2. If the various warehouses receipts or other bankers procuring the acceptance of such drafts for the such documents conveying or securing title to drawer are not eligible for acceptance by member banks; the grain are lodged with a custodian who holds since they do not grow out of "transactions involving the tHem as security on behalf of the various accept- importation or exportation of goods " within the meaning ing banks. of section 13 of the Federal Keserve Act. First. As this is a domestic transaction, the Board is without authority to authorize a mem- SEPTEMBER 16, 1913. ber bank to accept drafts drawn under this SIR: It appears that a certain products credit unless the bank is secured at the time of company desires to arrange through a firm of acceptance by warehouse receipt or other such private bankers, with certain member banks document conveying or securing title to the to accept drafts of the products company havgrain. There is no discretion vested in the ing 90 days maturity and to agree to three Board to waive this specific requirement of the renewals of 97 days each, thus extending the statute. credit for one year. Second. Following the precedent established The question arises whether such drafts may in the American Tobacco Co. credit, the Board be treated as "growing out of transactions might permit the warehouse receipts to be de- involving the importation or exportation of livered to a trustee or agent and to accept as a goods" within the meaning of section 13 of the similar document some form of receipt or some Federal Reserve Act. notation on the draft itself, signed by the trus- According to the papers submitted the tee, identifying it as one secured by the grain products company proposes to enter into an stored. agreement with the private bankers to pay The accompanying letter calls attention to these bankers a commission for procuring the the fact that it is contemplated, however, that acceptance of certain member banks of drafts the grain will be moved from time to time, and drawn by the products company. If this for this reason it is impracticable to identify credit can be arranged the products company collateral for the drafts. It does not appear agrees with the private bankers to obtain title from the papers submitted just what procedure to and consign to such bankers or their agents, is to be followed when this grain is moved. when manufactured and shipping facilities The Board's regulations require that the com- become available, quebracho extract and meat modities securing the drafts in such cases products in an amount of which 50 per cent Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 977 of the proceeds thereof will suffice to fully cover The Board's regulations require that the all drafts drawn and outstanding under the person for whom the draft is accepted must agreement. have "a definite bona fide contract for the The products company apparently owns shipment of the goods involved within a certain forests and pastures in South America specified and reasonable time." The present and desires these funds for the purpose of case does not meet this requirement. To cutting down trees and manufacturing the modify or relax this requirement would be to bark into quebracho extract and for the pur- establish a very dangerous precedent. It is pose of purchasing, fattening, and shipping no doubt true that the products to be imported cattle. In other words, the substance of this are very necessary and that it is desirable agreement is that if the banks will accept these from the standpoint of public interest that drafts at the instance of the private bankers some arrangement should be made to finance and that the bankers will arrange to sell such the transaction involved, but in the opinion of acceptances and turn over the proceeds to the this office the drafts in question could not products company, the products company consistently be classified as having been drawn agrees to produce or purchase and to consign in a transaction involving the importation of to such bankers "in time to meet the maturity goods within the meaning of that language as of each draft or its agreed renewals sufficient used in section 13, and in the absence of shipmerchandise to equal twice the amount of the ping documents and warehouse receipts securdraft." ing such drafts they could not be accepted as The products company further agrees that drawn in a domestic transaction. " the goods shall all have been sold by the ship- Respectfully, per at the time of arrival for immediate de- M. C. ELLIOTT, Counsel, livery." To Hon. W. P. G. HARDING, Without going into other details of the Governor, Federal Reserve Board. agreement the question is presented whether drafts drawn under these circumstances can be said to grow out of transactions involving the importation of goods. Stamp tax on trade acceptances. The following ruling has been made by the The language of the statute is broad and has Deputy Commissioner of Internal Revenue as been given a liberal construction by the Board. to who should affix the revenue stamps to trade From the facts submitted in this case I am of acceptances: the opinion, however, that the Board would not be justified in approving the acceptance by TREASURY DEPARTMENT, a member bank of the drafts in question. It Washington, September 13, 1918, is obvious that the products company desires GENTLEMEN: Answering your letter of the 27th ultimo received by reference from the Federal Reserve Board, to borrow money with which to carry on its you are advised that the drawer, as the person " who makes, operations in South America, and in considera- signs, or issues " a trade acceptance, should affix and cancel tion of a loan being made to that company it is stamps covering the tax required thereon under subdiviagreed that at some future time it will manu- sion 6, schedule A, act of October 3, 1917. There is nothing in the law, however, that would prevent facture and import into the United States the acceptor from affixing the requisite stamps to a trade quebracho extract and meat products. acceptance and agreeing with the drawer of the draft as to If the Board should rule that drafts drawn which of the parties would ultimately bear the expense. under these circumstances could be treated Respectfully, B. C. KEITH, Deputy Commissioner. as drawn "in a transaction involving the importation of goods/' it would follow that a domestic corporation engaged in business in the United States might in any case arrange Stamp tax on promissory notes. for member banks to accept its drafts upon The following ruling as to the taxability of executing an agreement that it would use the renewals of promissory notes under the act of proceeds to manufacture or purchase goods October 3, 1917, has been rendered by the intended ultimately for export. Solicitor of Internal Revenue: It is, of course, obvious that if this ruling is adopted the requirement of the statute that TREASURY DEPARTMENT, Washington, September 17, 1918. such drafts should grow out of transactions DEAR SIR: Replying to your inquiry of the 30th ultimo, involving the exportation or importation of with respect to the application of the stamp tax imposed goods would have little meaning. by the act of October 3, 1917, upon promissory notes, to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

978 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. promissory notes renewed by indorsements, there are provides for the examination of such bank and inclosed herewith two copies of T. D. 2265. This decision trust companies by the Federal authorities and was issued under the act of October 22, 1914, but the rule for the acceptance of such examinations by the laid down therein is being applied to the existing statute. Respectfully, State authorities in lieu of those required under (Signed) ARTHUR A. BALLANTINE, the State law; and authorizes the State authori- Solicitor of Internal Revenue. ties to disclose to Federal authorities information as to the condition and affairs of State (T. D. 2265.) banks and trust companies becoming members EMERGENCY REVENUE LAW.—RENEWALS OF PROMISSORY of the Federal Reserve System. NOTES. The act reads, in part, as follows: TREASURY DEPARTMENT, SECTION 1. Be it enacted by the General Assembly of OFFICE OF COMMISSIONER the State of Georgia, and it is hereby enacted by authority OF INTERNAL REVENUE, of the same, that any bank or trust company organized Washington, I). C, November 22, 1915. under the laws of this State which is or which becomes a SIR: In response to your communication of the 16th member of a Federal Reserve Bank shall keep and maininstant, you are advised that a promissory note issued tain as a lawful reserve the same reserves as are required prior to December 1, 1914, and renewed or extended after of other banks members of the Federal Reserve System, that date would be taxable under the act of October 22, and a compliance by any such bank or trust company in 1914. (See T. D. 2170.) this State with the reserve requirements of the Federal Reserve Act shall be held to be a full compliance with the With respect to what constitutes a renewal of a promisprovisions of the laws of this State on the subject of bank sory note, this office has made the following ruling: reserves, and such bank or trust company shall not be "A written agreement, either attached or unattached to required to carry reserves other than such, as are required a promissory note, or in the form of an indorsement on the note, such as * Renewed1 or * Extended' to a certain under the terms of the Federal Reserve Act. date, evidencing payment and acceptance of interest in SEC. 2. Any bank or trust company chartered under the laws of this State and doing business therein which beadvance to a time certain, subsequent to maturity, concomes a member of the Federal Reserve System shall be stitutes a renewal of the note and is subject to tax as such subject to the examinations required under the terms of under the above act." the Federal Reserve Act by the proper officers thereof, and On the other hand, part payment of a note after it has the authorities of this State having supervision over such become due, or payment of accrued interest after maturity, banks or trust companies may in their discretion accept the note being allowed to run, and the holder neither such examinations in lieu of the examinations required losing nor postponing his right of action, is merely in the under the laws of this State; provided, that the fees for nature of a forbearance, and is not taxable under said act examination of banks under this act shall be paid to the as a renewal. ^ • ,^ State bank examiner as now required by the laws of this Respectfully, DAVID A. GATES, H> State. Acting Commissioner of Internal Revenue. SEC. 3. Be it further enacted that the authorities of this State having supervision over such banks or trust companies may in their discretion furnish to the Federal Reserve Board or the Federal Reserve Bank of which any Amendments to Georgia banking laws. bank or trust company in this State may become a mem- An act of the General Assembly of Georgia, ber, or to the examiners duly appointed by the Federal Reserve Board or such Federal Reserve Bank, copies of approved August 20, 1918, provides that banks all examinations made of banks and trust companies beand trust companies chartered under the laws coming members of the Federal Reserve System, and of the State, which join the Federal Reserve may disclose to such Federal Reserve Board," or to such System, shall be subject to the reserve require- Federal Reserve Bank or such examiners, in their discrements of the Federal Reserve Act instead of tion, any information with reference to the condition or affairs of such banks or trust companies as become members the reserve requirements of the State law; of the Federal Reserve Bank in this State. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUMMARY OFJBUSINESS CONDITIONS, SEPTEMBER 23, 1918. O a District. b G u e si n n e e r s a s l . Crop condition. Industries of the district. Con an st d ru e c n t g io in n e , e b r u in il g d . i ng,! | f F o o r r e o i iV gn n t t r ra a r d J e p . ; ; Rail ro o a th d e , r p re o c s e t ip of t f s i . ce, Labor conditions. and jjJ I No. 1—Boston Good = Good Busy Very quiet except on j Increased over last! Steady at 0 per Increase.. Scarce, especially farm help. No. 2—New York. Continues very; Cereals good, ex-Intensified activity to Government construe-1 Balance of exports Very firm \ Post office returns in- Continued scarcity. active. cept corn. meet expanding Gov- tion heavy; other : over imports in- 1 crease 25.20 per cent ernment program. light. creased 22 per over 1917; railroad cent over July, ! net c arnings increase 1917. over last year. No. 3-Philadel- Good ! Good Busy Very little building... Firm Increasing Supply." of labor phia. short. i No. 4—Cleveland.. ....do Satisfactory Production at maxi- Very quiet. Very firm j Increase.. Demand exceeds supply. No. 5—Richmond.. Continues very! do. Limited only by sup- Practically confined to Restricted by Very active de- ' Railroad, imprqve- Somewhat imactive. j pliesgand labor. Government work. shipment. c m e a n n t. d ; 6 per | i v rn o e lu n m t; e la p r o g s e t . office, p m ro a v n ed d ; ; i h n ig d h e- ! wages. No. 6—Atlanta Good Fair to good Operating full capacity. Dull ; Dull Slight increase Increase.. i Unsatisfactory. i No. 7—Chicago do Good Essential industries ....do Steady. .do. busy. Scarce and restless. No. 8—St. Louis... ....do Fair Active ....do Firm... Increase in postal receipts. Good demand. No. 9—Minneapolis do Harvesting re- Very active. Slow. Very firm. Little change.. Fair to good. turns excellent. No. 10—K a n s a s do Fair Active Limited.. Firm., Improved. City. No. 11—Dallas Satisfactory... Fair, except in Active; operations lim- Inactive Fair Steady to Arm... Railroad receipts in- Unsatisfactory. western Texas. ited by shortage of la- creased: post office bor and materials. receipts increased. No. 12—San Fran- Active Good Active Increase in industrial Increasing.. Unchanged Postal receipts in- | Demand exceeds cisco. centers; elsewhere creased. j supply. inactive. CO ---i CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

980 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. GENERAL BUSINESS CONDITIONS. There is given on the preceding page a sum- standstill, with contractors and allied lines mary of business conditions in the United trying to keep their organizations together until after the war. States by Federal Reserve districts. These The money market remains on a fixed basis, reports are furnished by the Federal Reserve with a nominal rate of 6 per cent quoted for agents, who are the chairmen of the boards of practically all kinds of paper, regardless of directors for the Federal Reserve Banks of the date or name. Prime banks7 acceptances, 90 several districts. Below are the detailed re- days to run, are quoted at 4i per cent to 4^per cent, while loans on Liberty bonds are reports as of approximately September 23: being made at 4| per cent to 4| per cent. The policy of credit conservation is being followed DISTRICT NO. 1—BOSTON. everywhere. Banks are able to care for the A canvass of the important centers in Newlegitimate needs of their customers but are England during the past month confirms the restricting those engaged in less essential opinion that business as a whole is good, and industries. Rates are not a consideration in that industries engaged on war orders are as making loans and borrowers who would willbusy as labor and supplies of material will ingly pay higher than existing rates for money permit. The public generally is making prep- for less essential purposes are being curtailed arations for the fourth Liberty loan, with so that necessary industries may be given indications that the offering will meet with required accommodation. generous response. The people are thoroughl}r The weather during the month of August aroused to the needs of the country, and a was very favorable for maturing crops. Grain fixed determination to conduct affairs so each yields generally promise high averages; corn can do his individual share is everywhere has made fair improvement, while potatoes apparent. where dug are yielding we"ll . G^arden crops The period of transition from peace to war are generally good and are maturing early, work is practically over, and business is settling As the fruit orchards were damaged last into the new routine. The adjustment of labor winter, the yield of winter apples is fight but offers an interesting study. In some commu- the quality is fair. Fall apples are more nities, especially in the country, many local plentiful. people, who for one reason or another have not A recent frost did considerable damage previously been large earners, are now em- through the northern and central portions of ployed in newly established shipyards. Their the section, corn being particular!}7" affected wages are spent freely, and are a source of in Maine, New Hampshire, and Vermont. benefit to local merchants, although banks are Only light frosts occurred in the southern having loans paid which have been running for section, with no damage resulting. years. Pay rolls continue to increase, in a The boot and shoe industry is busy, with textile city one bank shows that in August, factories running as full as conditions will 1918, it required nearly twice the amount j permit. Leather prices on the whole are firm, needed in August, 1916, to pay an equal num- | Especially heavy Army and Navy contracts ber of men. This community, too, is prosper- | have been awarded and these will absorb ing through the liberal expenditures of work-! large quantities of material. Civilian trade is men. somewhat unsettled, due to the impending Sections having no war industries are feeling regulations from Washington restricting styles, the reflection of general business activities in ! Cotton mills are extremely busy, being sold other places, and this is indirectly helping!; as far ahead as the managements care to their local condition. A comparison of busi- j accept orders. Under present conditions manness in the large centers' for the past summer j ufacturers are unwilling to commit themselves period discloses the volume in dollars as well! to new contracts, not laiowing how large will sustained, although in many cases the number j be the Government requirements for the everof articles sold decreased. increasing Army or how badly they will be Labor of all kinds is scarce, this being par- affected by the loss of skilled workmen in the ticularly true of farm help. Building, except draft. What few new orders mills are acceptfor Government needs, is practically at a ing are from old customers and more a matter Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 981 of accommodation than of business. Cotton though mounting costs of production are narhas advanced materially since the present prices rowing profits, there is general prosperity. were fixed and manufacturers, even if in a Collections are reported good. position to accept new contracts, would rather Labor.—The labor problem, complicated by hold goods than sell until after the prices are the extension of the draft, gives concern to revised October 1. many interests. From manufacturing centers, Woolen and worsted mills are running at both in the northern part of the district and in capacity. Each month shows a larger per- New York City and vicinity, there is constant centage devoted to war orders until on Septem- complaint of shortage of unskilled and semiber 2, according to the National Association of skilled labor. Community boards composed Wool Manufacturers, over 57 per cent of theI of representatives of the Government, of emwoolen spindles and 62 per cent of the worsted| ployers, and of employees, respectively, are spindles were engaged on this work. Wool being organized in the districts by the United dealers are handling wool on a commission States Employment Service, and the transfer basis for the Government and no wool has yet of labor to the more essential occupations has been allotted for civilian trade. The Govern- already begun. Notwithstanding handicaps, ment has named two representatives to pur- New York State manufacturing plants show a chase wool in South America, superseding the gain of 6 per cent in the number of workers as syndicate appointed some time ago. compared with July, 1917, the metal group Boston Clearing House figures compare as| alone reporting a gain of 19 per cent. The follows: I total wages paid were 36 per cent above those of July last year. Merchandising.—Sales of clothing, at retail, ! Sept. 14,1918. Sept. 7, 1918. Sept. 15,1917. show the usual autumn revival. Sales at auction in the fur trade have been in large Loans and discounts ! 490,167,000 494,005,000 j 451,491,000 volume at extraordinarily high prices. Cham Demand deposits | 428,494,000 429,883,000 365,822,000 Time deposits i 15,682,000 15,914.000 29,929,000 stores are very prosperous. Mail-order busi- Due to banks 114,202,000 112,822', 000 ! 121,412,000 Exchanges.. 279,000,840 1244,152,983 \ 240,342,095 ness is reported heavier than last year. Ketail trade is generally active, but with scarcity of i Five days. goods in various lines apparent. Iron and steel.—Attention in the iron and Building and engineering operations in New steel industry is centered on the question of England from January 1 to September 11, prices for the fourth quarter. Users of pig 1918, amounted to $118,367,000, as compared tin have been deferring active purchases, with $147,973,000 for the corresponding period awaiting the determination of the price at of 1917. It is estimated that between one- | which tin is to be distributed under the interthird and one-fourth of this amount is due to national pooling arrangement recently an- Government building operations. nounced. The receipts of the Boston post office for Coal.—Anthracite receipts are slightly im- August 1, 1918, show an increase of $142,809.15, proved. Bituminous deliveries, though comor about 21 per cent, more than August, 1917. ing in steady volume, are inadequate to meet For the first 15 days of September, 1918, re- I demand, and concern as to winter suppfy is ceipts were about 8 per cent, or $29,791.40, j generally expressed. more than for the corresponding period of last Textiles.—Fully 50 per cent of the current year. production of cotton, wool, and knit goods is | under Government contract, and the balance, DISTRICT NO. 2—NEW YORK. consisting largely of cotton materials in process While there is great activity in most of the of manufacture, is not being released by the principal industries of this district, war work mills pending the determination of a new is more and more the dominating influence, schedule of prices to take effect October 1. with private enterprises everywhere subordi- Wool is being allocated to the mills in amounts nated to the needs of the Government. In sufficient to fill Government orders only, and mercantile channels there has been a decided there is some uncertainty as to how much raw lessening of quantity and variety of goods material will be available for civilian use. available for civilian uses, and merchants are Building.—The F. W. Dodge Co. estimates increasingly cautious. In the industrial field, that building contracts actually awarded in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

982 FEDEKAL RESERVE BULLETIN. OCTOBER 1,1918. New York and northern New Jersey for the savings banks as of July 1, 1918, show that month of August amounted to $24,734,000, their deposits were somewhat larger than on less than 3 per cent under the figure for August the corresponding date a year ago, as divia year ago. The estimate for the first eight dends credited slightly more than offset a months of 1918 is $181,322,000, as compared $72,000,000 excess of withdrawals over dewith $212,238,000 for the same period last posits during the year. year, a decrease of approximately 14 per cent. Corporate financing.—Incorporations in the Of the total, it is estimated about 130.9 per Eastern States in August decreased 69 per cent now represents Government work. cent in amount as compared with a year ago, Building permits issued in New York City and new securities offered by railroad, indusare 6 per cent under the total for August, trial, and public-utility companies amounted 1917, and the Borough of Brooklyn shows an to only $86,614,000, against $160,855,000 in increase of 17 per cent attributed primarily July of this year and §161,781,000 in August, to governmental activity. Close supervision 1917. The request of the Capital Issues Comof ordinary construction is assured by a permit mittee on September 9, that offers to the public system instituted by the War Industries be postponed until after the fourth Liberty Board on September 6. loan campaign, resulted in general absence General manufacturing,—The action of the of new security issues on the market in Sep- War Industries Board, on September 9, in tember. classifying industries as to priority in allot- Interest rates.—The volume of commercial ment of materials, has further limited the use paper outstanding continues approximately of materials and labor to war work. Several the same as during August, and the customary large automobile manufacturers have anrate remains at 6 per cent. Prevailing rates nounced their intention to discontinue profor bank acceptances were 4| per cent and for duction of pleasure cars. time paper secured by United States bonds Wholesale dealers in metal products have and certificates 4J to 5 per cent. Other time difficulty in replenishing stocks, even when paper rules at 6 per cent. Six per cent was placed on a priority list under agreement to the prevailing rate for call loans on mixed sell only to concerns engaged in war work. collateral, with the supply of funds limited. The market for drugs and chemicals is com- Securities.—Stock prices have tended slightly paratively quiet outside of Government dedownward, and bond prices have been fairly mand, with prices so firm as to be in some steady. Liberty loan issues advanced slightly, cases nominal. following the recommendation of the Secretary Agriculture.—Shipments of grain and underof the Treasury to Congress for their partial grades of dairy products, particularly eggs and exemption from income tax under certain fresh-killed poultry, have been heavy, but conditions. receipts of both butter and cheese have been lighter than in 1917. The Food Administra- DISTRICT NO. 3—PHILADELPHIA. tion order that 60 per cent of all creamery butter in storage August 1 should be reserved I General conditions throughout the district for Government use was followed by a vigor- | continue favorable, trade in most lines surous upward movement in price. passing last year's records. An excellent fall With the exception of corn, cereal crops business is expected, as the working classes throughout the State are bountiful, the yield are in receipt of good wages and there is an of wheat in some sections being estimated at inclination on the part of the public to antici- 47 bushels per acre. pate a further rise in the prices of goods. Banking conditions.—The banks of the dis- Manufacturers in all important lines are trict and the Federal Reserve Bank have dur- operating to the fullest extent permitted by ing the month shown increases in loans and the available supplies of materials and labor. investments, due partly to seasonal causes, Retailers report a steady demand for all including the movement of the heavy grain kinds of staple commodities, but they are crop from the Northwest, in part to the heavy experiencing increasing difficulty in obtaining subscriptions to certificates of indebtedness sufficient merchandise to meet the requirements in anticipation of the fourth Liberty loan, I of their customers. Retail distributors of and also to movement of funds from this women's wearing apparel are doing a large district to other districts through the gold- business, the demand for high-class goods being settlement fund. Reports of New York State ; greater than ever before. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDEBAL RESERVE BULLETIN. 983 Wholesale dry goods houses report the which are readily furnished to concerns doing receipt of large orders, but in some instances Government work. actual sales have been running behind last The chemical market has been fairly active. year owing to the physical impossibility of Dyestuffs are in excellent demand. Manugetting out orders due to the deficiency in the facturers of paint report that a satisfactory supply of labor. Collections are said to be business is being done with the various Govvery good, and the fall and winter outlook is ernment departments, and the outlook is for excellent. increasing orders from these sources. Do- The transportation situation continues to mestic consumption of painting materials conshow improvement. Total freight car move- tinues disappointing, due to the curtailment ments over the Pennsylvania Railroad, during of building operations. August, at Lewistown Junction amounted to Advices from Lancaster County indicate a 207,088 cars, compared with 210,575 in July remarkable growth in tobacco during the past (the record figure) and 173,932 during August, month, and the crop is pronounced both by 1917. Eastbound bituminous coal increased jgrowers and packers as unusually fine in 34.9 per cent, compared, with August of last jquality. Buyers, however, are holding back, year; miscellaneous westbound fell off 30 per jexpecting a break in prices-on account of the cent. I large increase in the number of pounds on It is estimated that if the coal production j hand. Labor troubles arc being somewhat can be maintained at the average level of the j relieved by the use of a new machine for last three months during the rest of the year, making cigars. requirements will have been met. Anthracite The commandeering by the Government of operators and miners are working most indus- 60 per cent of the butter in cold storage retriously to meet the emergency. This is sulted in considerable competition by dealers indicated by the statement of shipments for for supplies of butter, and prices rose rapidly. the month of August as reported to the Money rates have remained firm, being Anthracite Bureau of Information which es- quoted at 6 per cent. Banks are buying little tablished a new high record for that month, or no paper from brokers and loans are being the quantity sent to the market being 7,180,923 closely scrutinized. tons, compared with 7,084,775 in July and Discount operations at the Federal Reserve 166,927 tons in excess of the shipments for Bank during August exceeded previous rec- August, 1917. Total shipments for the first ords, total loans and discounts amounting to five months of the present coal year begin- $165,420,382, of which 67 per cent were notes ning April 1, 1918, have amounted to 34,388,986 secured by Liberty bonds or certificates of intons, compared with 33,297,109 tons for the debtedness. Acceptances purchased amounted corresponding period last year, a gain of a to $4,432,670. little over 3 per cent. DISTRICT NO. 4—CLEVELAND. Bituminous production is being maintained at a high tonnage, but is not sufficient to allow Business conditions in the Fourth Federal any margin of safety over the demands as Reserve District have undergone very little estimated by the Fuel Administration. change during the past month. There is more Production of steel during August was about or less complaint about the shortage of labor, 80 per cent of capacity, the falling off being but business generally seems to be adjusting due chiefly to the unusually hot weather. itself to new conditions and to be getting along The raw cotton market has been unsettled with facilities which at one time would have by the price-fixing plans. The demand for appeared entirely inadequate. In fact, it is cotton yarns by mills engaged on Govern- rather astonishing to note the readiness and ment work is greater than the supply. The apparent ease with which manufacturers, Government has entire control over the wool merchants, and individuals are conforming to business. Government requirements. Hosiery and underwear mills are busy. The Agriculture.—In nearly all sections of the Government needs for hosiery have been well district the crops are fairly well harvested and taken care of; mills can now work on civilian are very satisfactory. Corn has been greatly trade, but it is said that they hesitate to take benefited by the recent rains. The crop looks advance orders for this class of business, fearing very promising, and in many localities the they will be unable to obtain fuel and materials quality is much better than last year's crop, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

984 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. The oat crop proved to be particularly good. Employers are at a loss to know just what Fall plowing for wheat is now under way, and the effect of the 18-to-45 draft will be with it is believed that a very large crop will be reference to their organizations. While exempput in. tions will be asked in some cases, the general Recent rains have benefited the tobacco feeling among business men and manufacturers crop very much, and it gives promise of being is that the winning of the war is paramount one of the largest and best crops ever raised. and that nothing not directly connected there- The exceedingly cool weather has made planters with ought to impede the Government program. somewhat uneasy about an early frost, but it Women are gradually taking the places of is hoped that the crop will be housed before men in offices and banks and in factories where the frost overtakes it. the work is comparatively light. Fall grass is probably better than it has been Transportation.—There has been a decided for years, a condition which has been very improvement in transportation conditions. helpful to cattle feeders, who are shipping Congestion is very much less marked at tercattle very rapidly and obtaining high prices minals, indicating a freer movement of freight. therefor. Lake transportation- is being taxed to its Manufacturing.—--Concerns engaged in theutmost capacity to insure the delivery of as manufacture of essentials seem to find it less much material and fuel as possible before difficult to obtain a reasonable amount of raw navigation closes. materials, and their labor difficulties are not Mercantile business.—Mercantile concerns as numerous as they were a few months ago. report good business and, although they are The Government has made such demands still somewhat hampered by inability to obtain upon the steel manufacturers, as well as other goods from the mills, the condition in this producers, for war supplies, that practically respect is considerably better than it was last everything in the steel line is being devoted month. Those with good records for prompt to munitions and ships. In the Pittsburgh payment and good credit at bank seem to have district the steel mills are operating at capacity, less difficulty than heretofore in obtaining goods and during the past month they have appar- promptly. Terms are shorter and trade disently been making up a large part of the loss counts are being discontinued inmanyinstances. which naturally occurred during the extremely Retail stores say that business is good, warm weather. although there is a continued tendency on the The pottery business continues good, and part of consumers to purchase cheaper and the sand and brick business shows considerable more stable articles. activity. Collections.—Collections are good, indicating Fuel.—The demand for coal is exceptionally from a jobber's standpoint that retail merstrong. The output by many companies is chants are adjusting themselves to conditions below that of a year ago owing to the number requiring additional capital. of men who have joined the colors. Mining One large manufacturer reports payments is being pushed through southern and eastern for the current month of 104 per cent of ship- Ohio, and every effort is being made to get the ments, and out of a total of $13,000,000 colcoal to the Northwest before navigation closes lected less than $500,000 was accepted in paper. on the Great Lakes. Ohio coal roads have These figures are believed to be fairly indicabeen pushed to the limit to take care of the coal tive of the situation generally. Failures confor lake trade. While there has been some tinue to decrease and but little complaint as storing of coal by manufacturers, reports from to payments is heard. all sections indicate that unless there is a Post-office receipts in all of the nine principal speeding up of this class of business there will cities in the district show a substantial increase be a scarcity of coal in many localities. over last year's figures. Labor.—TThere has been little if any relief of Money and investments.—In anticipation of the labor shortage, but the shifting of workers the largest Liberty loan yet to be floated, the from place to place is being checked to some extent of the over-subscriptions to the later extent by the United States labor and employ- issues of Treasury certificates is believed to ment officials. have stabilized the money market. In conse- During the week of September 9 12 breweries quence little disturbance is expected when subin the Pittsburgh district closed for the dura- scriptions are paid. Money, however, contintion of the war, thus turning considerable labor ues scarce and member banks make liberal use into essential channels. of the rediscount privilege. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1018. FEDEEAL RESERVE BULLETIN. 985 Trade acceptances are growing in favor and trade, though rail deliveries continue to show have greatly facilitated the movement of staple marked improvement. commodities in the process of their distribution. Shortage of labor is reported generally Governmental requests and unusual demands throughout the district, and while by no means work together to restrain banks from loaning to satisfactory in efficiency this condition is better other than essential commercial enterprises, than it has been for several months past. and there is a hearty spirit of cooperation There has been less shifting of labor than hereexhibited by both bank and customer. tofore, attributable perhaps to the effective- Building.—Practically the only building ness of the policy inaugurated by the Governbeing done is that of dwellings for workmen and ment of discouraging labor from leaving emadditions to plants engaged on war work. ployment in one section to seek it in another. Plans for the fourth Liberty loan are com- DISTRICT NO. 5—RICHMOND. pleted. Demand for Government uses have been the DISTRICT NO. 6—ATLANTA. feature in trade activities throughout the dis- Business conditions throughout the district trict during the month, and this demand is show little change with preceding month, increasing. To shorten the period of exposure except that the shortage of experienced help for our boys at the front as much as possible in all lines is causing a slight decrease in prois the endeavor of all, and in building up at duction, with corresponding increase in costs. home our great military machine, the feeling is Vacancies in clerical lines are being filled by growing that their work should be accomplished women not heretofore engaged in the comthoroughly and without unnecessary delay. mercial world. Except for Government work and housing, Until the question of cotton price fixing is building in the district is very inactive and disposed of there will remain an element of real estate transactions at a minimum. Collec- uncertainty both with the producer and the tions are reported generally good and 1918 fail- buyer, and coming as this does at marketing ures in the fifth district for the corresponding time it is likely to further disturb prevailing months (January to September) of last year conditions. The favorable cotton - picking show a decrease of 66 per cent in number and weather has largely offset the labor shortage. 77 per cent in volume. Bank clearings show Gins are operating on full time on the days a largely increased volume for the month as allowed by the Fuel Administrator but can not compared with the corresponding month of last keep up with the ginning, as producers inyear. Postal receipts also show an increase. variably sell on a fair market sufficient bales Crops have shown improvement as harvest- to acquire some ready cash and pay for ading nears, though considerable damage has re- ditional picking. Wages for pickers run as sulted from heat, drought, and hail storms. high as $1 per 100 pounds, and planters will Cotton has perhaps suffered most, and the out- probably have to pay more before the crop is look is not as favorable as a month ago. While gathered. Second growth has started, but the conditions appear unfavorable for quantity, with the deterioration of the past 30 days under good weather conditions the crop can be prospects for a top crop are very slight. The gathered free from dirt or stain, and at the corn crop will approximate that of last year, present prevailing price almost any shortage in with sufficient peanuts and velvet beans to volume will be overcome to the producer by more than feed the hogs and cattle. The the enhanced price. Tobacco is good and the brightest feature of the situation is that prices in the Virginia markets are higher in where cotton is worst corn and velvet beans comparison than the earlier sales in the Caro- are best. There has been considerable increase linas, Virginia now averaging around 40 cents, in Irish and sweet potatoes, with an apple crop with the largest crop for years. There is a fair reported good. crop of fruits and vegetables of rather inferior The condition of the orange crop remains quality, though canning industries report thus unchanged from a month ago, but is well above far satisfactory operations. the average condition for a number of years. Wholesale trade in staple commodities is ex- Reports indicate that the citrus crop as a ceptionally good, though shorter terms are indi- whole will ripen somewhat earlier than in forcated and advance sales curtailed. The ques- mer years. tion of delivery, both by manufacturers and by Since the beginning of the war the product transportation companies, is affecting retail ! tion of the castor bean has grown to be a factor Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

986 FEDERAL RESERVE BULLETIN". OCTOBER 1,193 S. ! in north Florida farming. This year's crop is j moderate quantities and often. Overall manuripening rather slowly, though up to the present facturers are far behind on July deliveries, time one of the largest hulling plants of the owing to Government demands, and can not section has handled about 400,000 bushels, solicit new business until the mills are in posiwith an estimated value to the farmer of tion to contract for future deliveries. While $1,200,000. there is a slight pessimism among dealers in Sirup crops are below average, and it is too men's lines on account of the 18 to 45 draft, late to make a crop equal to that of last year. the general feeling is that this will not affect Sirup manufacturers report outlook for fall j the fall and winter trade. 3 and winter business as good, with high prices Post-office data furnished by 20 of the more indicated. On account of the scarcity of sugar, important offices in the district show receipts consumers are using a good deal of sirup for for August, 1918, $737,939; August, 1917, "sweetening," and the manufacturers are $458,819; an increase of $279,120. having more business at present than they can Bank deposits continue to increase, with take care of, on account of the scarcity of labor slight decrease in loans, caused largely by and inability to get box material. i curtailment of credits to what is deemed The tobacco crop of southeast Georgia is nonessentials and the result of the work of the reported good and is about harvested. Ten- Capital Issues Committee in passing on the comnessee reports an estimated tobacco crop of | patibility of certain expenditures at this time. 53,000,000 pounds, as compared with 81,000- Collections are good and with prevailing high ; 000 pounds last year. Cutting and. housing is prices prompt payment of obligations are progressing under favorable conditions. looked for. Production of wool in Tennessee shows an Some uneasiness is felt as to the effect of the increase of 10 per cent over last year. new draft law in the reduction of man power Cotton-oil mills report their line of business in lines that are considered essential to the in a rather uncertain state, due to consideration national interest at this time, but the more of price fixing of cotton seed and cottonseed conservative business element are of the production, as the deterioration in the crop opinion that the Government will work out will cut short their supply of raw material. some plan to insure the working organizations Flour mills are reported as running less than in the financial and industrial fields, especially 30 per cent of their normal capacity, indicating in those forming a part of the war work. that they are producing but a little more than one-fourth the normal quantity of mill feed of DISTRICT NO. 7—CHICAGO. previous years, which is having material effect I As Government wants expand beyond all in the cattle-raising centers. It is felt that I previous calculations, the necessity for intenthe September 1 Food Administration regula- | sive productive efforts becomes daily more aption on the 80-20 basis will relieve the situation parent. With the concentration of industries considerably and probably lead to an operation on demands of the most essential character, of 50 per cent capacity. manufacturers and dealers alike hesitate to The lumber market shows signs of improve- accept civilian orders, awaiting calls for ment, with the Government requirements still supplies from official sources. In values comthe principal item. Building lines, except for mercial business remains at a high level, yet Government operations and industrial plants, transactions are diminishing in number as are very dull. Few building permits are being greater caution and more rigid economy is issued, and probably 90 per cent of such permits being practiced by dealers as well as consumers. issued are for repair work. ! Caution and conservation seem to be the Coal production is greater compared with watchwords in all lines not catering to Governlast year, but labor conditions prevent a larger ment needs. A concrete evidence to this output. Iron and steel business continue very effect is afforded by the remarkable exhibit active, with enormous demands and good as to commercial failures reported by R. G. prices. There is a continued labor shortage, Dun & Co. This report for August for the but no complications exist, as laborers are well whole country is numerically the smallest employed at high wages and are cooperating on record with the single exception of the same with operators in a satisfactory manner. month in 1899, while the indebtedness involved Wholesalers and jobbers of dry goods and has been smaller in August of only four other notions, while reporting good fall and winter years, namely, 1905, 1900, 1899, 1898. While business, state retailers prefer to buy in i these figures are for the whole country, the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDEEAL RESERVE BULLETIN. 987 showing for the Seventh Federal Reserve Dis- output. As a result of this, civilian needs are trict is practically reflected in proportion. being steadily set aside. Jobbers are relying From manufacturer down to the retailer a on stocks on hand, awaiting further allotments strong effort is being made to get closer to a of production for civilian wants. New stocks cash basis as evidenced by the very general of woolens have practically disappeared from reports of satisfactory collections. There is a the market, and cotton goods trading is held great deal of money in circulation and the back awaiting a new price fixing period. Other common people have more money in their lines are affected by influences that tend to pockets than ever before. This situation, make all trading conservative. The situation contrary to expectations, has not resulted in seems to depend on adjustment of supply and extravagance except in a few instances, the demand, and the problem, aside from price conservation campaign seeming to have had fixing, lies in the quantity of future production the desired effect. that can be allotted for civilian requirements. There is a continued heavy demand for Retail merchants seem well prepared to supply money, with interest rates firm at 6 per cent. the demand for fall and winter merchandise, While deposits are reported off, and loans have having anticipated their requirements well increased, making for a tight money market, in advance. banks are caring for necessaiy loans com- If the good transportation facilities of the fortably, discriminating more and more against present continue throughout the winter months, borrowers for nonessen^ial purposes as much no serious shortage of bituminous coal in the as such discrimination can be practiced without- district is anticipated. Illinois and Indiana entailing hardships or embarrassment to the mines are now supplying large quantities of borrowers. coal to consumers in other localities in addition Crop conditions in this district are good. to filling the requirements of the territory Wheat has all been harvested with a satisfac- allotted to them. tory yield and. very good quality. Reports in- The induction of millions of men into military dicate an increased acreage for the coming year. service, who in normal times would have That the price has been satisfactory, is evi- married and established homes, has had a telldenced by" the extremely heavy shipments of ing effect upon the retail furniture trade. wheat recorded during the past 30 days. While Relief from this situation has been accorded the extremely hot weather in August caused the manufacturer by the placing of Governsome damage to the corn crop, reports seem to ment contracts for certain wood products, point to a reasonably satisfactory though dis- while the retailer expects a stimulus to his appointing yield. The condition of this crop business as a result of the enormous amount is good and no soft corn is anticipated. Late of money now being paid out for labor to those corn needs more growing weather and the workers who remain at home. arrival of the first killing frost remains an all- High price? prevail in the live-stock market, important factor in its development. Other the price of hogs reaching the highest level small grains have been harvested with good ever recorded in the Chicago market. In spite yields. Meadows and pastures are in better of price advances, there is a continued demand condition and the general farm outlook is for fresh meats. Good trade is reported in very optimistic. packers' by-products—hides, glue, tallow, fer- The transportation supply has been ade- tilizer, and grease. Receipts of live stock at quate. Only two of the important factors in Chicago for the four weeks ending Septemindustry have been troublesome. These are ber 14, 1918, as compared with a like period material and labor, and the scarcity of each is, in 1917: of course, attributable to our concentration on war activities. While it is expected that Year. Cattle. Calves. Hogs. Sheep. the labor problem will be intensified by the process of the new draft, it is certain that 1918 . . 300,194 35,735 349,351 514,957 strong efforts will be made to safeguard 1917 269,926 35,827 226,988 279,531 essential industries and business. Available labor, though well employed at good wages, The volume of business in wholesale grostill manifests an impatient, independent, and ceries continues good. The removal of the migratory attitude. restrictions on flour effective September 1 will The Government is dominating the dry result in a large increase in flour sales for the goods market, in some lines taking the entire balance of the year. In spite of higher prices, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

988 FEDERAL RESERVE BULLETIN. OCTOHKJl 1, 193 S. the demand for all kinds of foodstuffs, espe- of gold and silver bullion, as stores are in the cially canned goods, is very large. Confection- main well stocked with gold and silver merers, already handicapped by the sugar shortage, chandise. With many piano factories turning fear a further curtailment of their allotment. their attention to Government needs, some The retail candy trade is good but is feeling operating 100 per cent on war work, the output the effects of inability to obtain the desired of instruments will fall far short of meeting the stocks. demand. Wholesalers of hardware furnish favorable The steel business has only one customer, reports, though suffering the hardship entailed the United States, but authorities state that by increased difficulties in securing supplies, after the war prospects are excellent for a especially in the heavy hardware line. The satisfactory continuance of volume due to the volume of trade compares satisfactorily with present need for many constructional operalast year. Retailers are quite generally per- tions held up for the duration of the war. mitting their stocks to diminish in anticipation Shipbuilders, busily engaged on contracts with of coming price changes. Dullness prevails in the United States Shipping Board Emergency all agricultural implement lines, though normal Fleet Corporation, are meeting with very good sales for this season of the year are reported. success in keeping up with their schedules. Only modest future demands are expected. The demand for provisions has been season- Lumber business is much reduced in ordi- able. Government requirements, both domesnary lines, but some concerns keep employed tic and foreign, are in most cases about equal through Government work. All other lines of to the supply of the kinds of product required building material report continued dullness, by them. with the outlook for improvement very proble- Clearings in Chicago for the first 13 business matical. Paper mills are very busy and are days of September were $1,207,000,000, being weeks behind their orders. Prices are ad- $264,000,000 more than for the corresponding vancing daily. 13 business days in September, 1917. Clear- The demand for men's shoes is surprisingly ings reported by 21 cities in the district outstrong. Retailers in their anxiety to obtain side of Chicago amounted to $293,000,000 for footwear are paying the advanced prices asked the first 15 days of September, 1918, as comby the manufacturers. Labor difficulties in pared with $268,000,000 for the first 15 days the East have flooded the western nmufac- of September, 1917. Deposits in 12 central turers with orders. Business continues very reserve city member banks in Chicago were active in the textile and wearing apparel trades, $882,000,000 at the close of business Septemmany of the manufacturers being months ber 17, 1918, and loans were $630,000,000. behind their usual time for opening up their Deposits show an increase of approximately lines. With the demand for raw material $5,000,000 over last month, and loans a deexceeding the supply, with a consequent short- crease of approximately $23,000,000. age in yardage, manufacturers and the cuttingup trade are experiencing the most difficult DISTRICT NO. 8—ST. LOUIS. season in their history. General business in this district continues The refusal of the Capital Issues Committee active, with Government work as the overto permit the sale of any new bond issues until shadowing factor. Manufacturers, wholesalafter the next Liberty loan, while slowing down ers, and retailers, generally, report that the trading, has created a satisfactory situation in volume of their business is in excess of the allowing bond houses to concentrate on issues volume at this time last year, especially when they are now carrying, thereby reducing their measured in dollars. Reports indicate that loans prior to the arrival of new demands on business men are moving carefully and that banks and individuals resulting from the the public is practicing economy in buying. Liberty loan subscriptions. Manufacturers of iron and steel continue Brewers and distillers report a continued especially busy, as do also manufacturers of decline in sales, while many liquor retailers boots, shoes, clothing, etc. For several months contemplate going out of business as soon as past many of the shoe houses have had no they are able to dispose of their stocks. Busi- salesmen in the field, but they are now starting ness of the mail-order houses continues to run them out for spring business. It is reported well ahead of last year. Jewelers anticipate that some are limiting their sales, as they will no ill effects from Government administration not accept orders until they have sufficient Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL EESEEVE BULLETIN. 989 leather on hand to cover all goods sold. Whole- ! condition of oats on September 1, in the 3 salers of dry goods also report an active trade, \ States mentioned, is estimated to yield 104,but some state that they; are not taking orders j 846,000 bushels, which is 4,624,000 bushels for future delivery. It is reported that many | more than the estimate of August 1, and large merchants are buying in the smaller | 17,981,000 bushels more than the 5-year markets, due to the scarcity of merchandise average. in the larger markets and a tendency for : The cotton crop has been severely damaged in higher prices to prevail there. 1 this district and the crop is considerably be- Department stores and retail merchants also low normal. On August 25 the condition of report a good business. In response to the the cotton in Mississippi, Arkansas, Tennessee, appeal of merchants the public has already ! and Missouri was estimated by the Governbegun to do its Christmas shopping. Collec- ! ment to be 59.2 per cent, which is 25 per cent tions are reported to be good. I less than the estimate of July 25 and 16.5 per Reports from the banks in this district ; cent below the 10-year average. Both in the show an increased demand for money during picking and ginning of cotton rapid progress September. This demand has been reflected \ is being made. in the rediscounts of the Federal Reserve • Plowing for winter wheat is completed in Bank, which have steadily increased. In the most localities and sowing is well under way. larger cities the bank rate to customers is still Reports indicate that the acreage will be in 6 per cent for practically all classes of loans excess of that sown last fall. and in the country districts it is somewhat Shipments of cattle and hogs to market conhigher. Many of the banks are now discrim- tinue heavy. The report of the St. Louis inating against loans for nonessential pur- National Stock Yards for August shows a poses, in response to the request of the Federal perceptible increase in the receipts of cattle Reserve Board. Practically none of the large and hogs, in comparison with the same month city banks are in the market for commercial last year, but a slight falling off in comparison paper, though some of the banks in the coun- with July of this year. The report also shows try districts are buying. The commercial substantial increases in the shipments of live paper rate prevails at 6 per cent for all names stock, both in comparison with the previous and maturities. month and August of last year. At the writing of this report the interest of The labor situation in this district is pracbankers, business men, and others is centered tically settled, and there is a good demand for in the flotation of the fourth Liberty loan, the for both skilled and unskilled workers. Women campaign for which opens on September 28 are more and more being called upon to fill and closes October 19. Every effort is being places formerly occupied by men. made in this district to insure its success. Postal receipts during August in St. Louis, The recent rains have revived pastures and Louisville, Memphis, and Little Rock all show helped the late truck and forage crops, but substantial increases in comparison with the they came too late in many sections materially same month last year. to benefit the corn. The condition of the corn Reports for August from leading cities in in the seven States included in this district was this district show perceptible decreases in the estimated by the Government on September 1 number of building permits issued and the to be 63.7 per cent, which is 10.7 per cent be- estimated cost of construction, both in comlow the estimate of August 1 and 14.7 per parison with the previous month and the corcent below the 10-year average. The con- | responding month last year. dition of the corn in this district on September ! A branch of the Federal Reserve Bank of 1 is estimated to yield 132,389,000 bushels of St. Louis was opened in Memphis on Septemcorn, which is 20,249,000 bushels less than the ber 2. estimate of August 1, and 6,693,000 bushels DISTRICT NO. 9—MINNEAPOLIS. less than the 5-year average. The oats crop is progressing satisfactorily The money returns from the 1918 crop in and indications point to a good crop. The this district will be highly satisfactory. In condition of oats in Indiana, Illinois, and Mis- terms of bushels the crop may not attain souri was estimated by the Government on record proportions, but1 its cash equivalent will September 1 to be 90.6 per cent, which is 11.6 be considerably in excess of that of any preper cent better than the 10-year average. The vious season. Harvesting is completed except- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

990 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. ing for e, small amount of late flax and the corn usual. The financial institutions of the discrop, and thrashing is in progrv^s everywhere. trict have performed a notable service in A satisfactory feature of the ».rop year is that promptly satisfying the requirements of the thrashing returns have in many instances been country, and such delays as have occurred in more satisfactory than was anticipated, and the marketing of this year's production can this has been particularly true in western North not be charged to them. Dakota, where the crop outlook early in the With very high returns for both fine and fall was not good. coarse grains, and the record prices farmers The ninth district will contribute to the have been and are enjoying for cattle, hogs, Nation's necessities a very large crop of spring dairy products, and poultry, the flow of money wheat of good quality. A large barley crop into the hands of those engaged in agriculhas also been produced, which with the reduc- tural production is very considerable. tion in the malting demand will probably be The high prices have materially helped the used more than in previous years for feeding sections that have suffered from scant crop purposes. The oat crop is large and the flax returns, while in the remainder of the district yield is satisfactory. A considerable crop of the farmers are close to a period when they rye is likewise an important contribution to will have ready cash to liquidate their obligathe production of foodstuffs. tions. There is, therefore, reason to expect Corn in the ninth district has escaped damage a continuation of prosperous conditions that from frosts, and over the district as a whole have prevailed up to this point and to anticwas beyond the danger point before cold ipate a satisfactory volume of business at weather came on. The corn yield is extremely country points during the late fall and winter satisfactory and the quality of the crop is very months. good. The cutting of corn is in progress The conversion of industry to war producthroughout the central northern portion of the tion has been slow but very persistent. Each district, while in the southern portion the crop week is witnessing an increase in the number is safely in storage. of enterprises engaged in war work. Most of Marketing conditions show some unusual the industrial concerns in this district are features. There has been a noticeable short- small, but the point has apparently been age of help, and it has been difficult for farm- reached when the Government is able to ers to move thrashed grain to the country classify these institutions according to their elevators. There has likewise been a shortage ability to serve and apportion to them items of help at terminal points and the unloading of of manufacture suited to their respective lines. grain arriving from the country has been slow. Much progress has been made during the last The grain movement is, however, in full swing 30 days in classifying and organizing manand in spite of the difficulties of transportation, ufacturing enterprises of the district for the both by wagon and by rail, the arrivals at ter- purpose of putting the maximum production minals are satisfactory. of concerns that can assist the Government at Wheat is moving in good volume, and farm- the disposal of the Federal authorities. ers have apparently chosen to defer the ship- Substantial progress has also been made in ment of barley and oats until the wheat is out restricting the offer for sale or subscription of of the way. stocks, bonds, and other forms of securities not Farm labor has been scarce throughout the compatible with the interests of the United fall, and at high rates of pay there has been a States in war time. The erection of effective noticeable loss in efficiency. Skilled and ex- supervision and control has naturally been perienced farm help is extremely hard to slow and difficult, but it has demonstrated the obtain. fact that notwithstanding the very excellent It has cost more to move the 1918 crop than work done by the Blue Sky Commissions in the any previous crop in the history of the North- various States, there has still been floated a west. The amounts of money involved be- considerable volume of so-called investment cause of the extremely high prices are very securities which ordinarily absorb very conlarge. The slow and laborious movement of siderable amounts of money and which give the crop at terminal markets has injected an little prospect of any return to the investor element of time and added to the burden of except experience. financing. The demand on the banks has con- The banks of the district are undergoing a sequently been very active and has continued difficult period due to the gradual withdrawal farther into the crop-moving period than is of experienced help, which is being replaced Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDEEAL RESERVE BULLETIN. 991 with female employees. The loss of purely Suota will be considerably higher than any clerical labor would not have been so serious if tie district has yet been called upon to raise. it had not been accompanied by the with- The War Finance Corporation Cattle Loan drawal of a considerable number of the younger Agency established in Kansas City to serve men charged with departmental or executive Federal Reserve Districts Nos. 8, 9, 10, and 12 responsibility. This has involved the training is a subject of absorbing interest to the eattle of an unusual percentage of new and inexperi- industry at this time. While the formation enced help and consequent disadvantage to of the agency is just being completed, there is institutions that have been heavily burdened already apparent among the banks and cattle with the activities of the crop moving period loan companies an easier feeling with respect and with war work. to the fall demands which will be made upon them by breeders and raisers throughout the DISTRICT NO. 10—KANSAS CITY. section. g Generally improved conditions following a Agriculture.—Moderate to heavy rains and cessation of hot and dry weather and news of lower temperature have put the ground into successes overseas have heartened the people good condition for fall planting, and with the of this district. The outlook for agriculture is Government's guarantee of a minimum price encouraging and preparations for larger food pro- on 1919 wheat, an increased acreage is to be duction next year are in progress. An unprece- sown. The moisture came too late to dented movement of grain and live stock to materially help the corn and the yield will be the markets continues. War prices for products about 25 per cent of a normal crop. Late of farms, mines, wells and factories, and war crops are turning out well, pastures revived and wages to labor, are putting more money into much rough food for animals is assured. people's hands, enlarging their purchasing Sugar beets will show a larger tonnage per power and their ability to pay their obliga- acre than last year but with 20 per cent smaller tions. Fall trade has assumed active- propor- acreage. tions, restricted only by difficulties of mer- Eeceipts of wheat since July 1 are three chants replenishing stocks. Manufacturing is times those for the corresponding period of last more and more confined to essentials, but, year and in excess of current needs. The like|mining and oil industries, it is handicapped Food A-dministration is attempting to relieve by shortage of labor—now the greatest prob- congestion by finding storage at terminal lem—and uncertainty as to how future activity points rather than attempt to find an outlet is to be affected by the new draft. for wheat as fast as it comes from the farms. Financial.—The larger volume of business Interior millers, fearing exhaustion of home at this season is reflected in the bank clearings supply, attempted to check the outflow, but of 15 cities in the district which show a total without success. With elevators full and for August of $1,516,180,000 as compared yards congested, the railroads were forced, on with $1,051,472,000 for August of last year, September 16, to declare a temporary emthe increase being 44 per cent. bargo at Kansas City, St. Joseph, and Omaha, The seasonal demands for crop moving, to permit a cleaning out of the surplus. Praccombined with the sale of United States tically all of the wheat has been sold at guar- Treasury certificates of indebtedness antici- anteed prices. The receipts of corn are larger Batory of the fourth Liberty loan, maintained than at this time last year but the new corn le money market steady and interest rates movement is hampered by wheat congestion firm. Treasury certificates anticipatory of the at the markets, with a tendency to lower corn fourth loan have been placed in this district prices. Receipts of oats are about the same aggregating $132,760,000 and subscriptions as last year. are now being received to an issue dated Milling operations in August were main- September 17. tained at 98 per cent capacity at mills in the The district organization for the conduct of district and 33 per cent above last year's outthe fourth Liberty loan campaign is more com- put, but slowing down slightly the first half of plete than in any of the previous loans, which, September with a slackening of the demand together with the experience of the past loans, for flour. gives assurance of raising the quota for the Live stock.—Receipts of cattle at the six fourth Liberty loan, although it is certain the markets in this district in August were 21 per Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

992 FEDEKAL BESERVE BULLETIN. OCTOBER 1,1918. cent larger than for the same month in 1917, same month last year. Wyoming maintained a new record for the eighth month. Hog and a steady pace, with a tendency toward a good sheep receipts were 40 per cent larger for the increase in the year's output. month as compared with receipts for August Completed wells in August were 147 more of last year. A large proportion of the cattle for the three States than in the same month and hogs was light and unfinished. While dry of 1917, but new production fell off 22,740 barweather is conceded to have influenced larger rels daily capacity. No wells of the gusher marketing, live-stock men point to the figures class were brought in and there was a larger as indicating an increased supply of meat per cent of dry holes and gassers. At the animals and an expansion of the live-stock beginning of September wells drilling were industry. 1,849 in Oklahoma, 491 in Kansas, and 221 Cattle prices are higher than last year, in Wyoming. finished steers reaching $18.50 as top price, Building and construction.—Inspectors in the and other grades $1.50 to $4.50 higher than a principal cities of this district report little work year ago. Hogs went to 820.55 early in Sep- in progress or in early prospect, except that tember, the record price. The average weight which is clearly indispensable. Permits in for August was 4 pounds below last year's number were 12 per cent less than in August, figure. Sheep generally are in better condi- 1917, but 50 per cent less money was required tion with prices ruling higher for good lambs. for their construction. The tendency is toward Purchases by packers were 2 per cent above smaller buildings and repairs until the war is the August, 1917, record on cattle, 19 per cent ended. Municipal improvements and general above on hogs, and 64 per cent above on sheep. construction are in like manner and propor- With heavy war orders the packers are in- tion subordinated to the war. Aside from supcreasing the meat output in about the same plying Government needs there is little activproportion. ity in the lumber trade. Building hardware Mining.—Further reduction in tonnage of and other materials are restricted in supply ore produced in Colorado is reported. Gold by demands for Government use. operators say 2,000 more miners are needed to Labor.—September finds few strikes and make production normal, and they are looking wage controversies in this section, and these for additional reduction of their forces in the of a local character. But the man-power new draft. A number of mines may be forced shortage is keenly acute. Government agento close. A wage increase, effective Septem- cies are classifying labor for distribution ber 1, is also having a depressing influence on among essential industries. State labor busmall mines, the operators contending the j reaus, commercial bodies, and manufacturing margin of profit is too narrow. associations are cooperating, hoping to relieve The demand for lead increases, with the the situation. Nebraska reports calls for 6,692 premium price reaching $104.50 this month, men and 3,617 places filled, Wyoming calls for and $100 as the basis. There is less of a de- 1,945 men and 120 places filled, New Mexico mand for zinc ore, sales of zinc blende ranging about the same, with the added report that from $50 to $60. many men have left the State to work in ship- Improved transportation conditions and a yards and other industries, on account of high somewhat better labor situation at the mines wages offered. Colorado is working hard to have slightly increased the coal output, but adjust the labor-supply problem, with a show the improvement offers no assurance the sup- of success, but still needs 2,000 more miners. ply will be ample when winter's pinch comes. The Missouri-Kansas-Oklahoma lead, zinc, and Oil.—Renewed activity is seen in practi- coal fields are short of men. Oil operators cally every field in this district. Operators have appealed to the oil division for a ruling are attempting under difficulties to bring pro- on the policy to be pursued in drafting men duction up to the demand. More than 300 for these essential industries, as they are wells were shut down in mid-August because unable to figure on future production until of inability to obtain water for their operation, they know what the draft is going to do to but these conditions have been practically them. eliminated. Mercantile.—Wholesale and retail merchants The Kansas output in August was slightly report an active business this month. The below that of July, but 9 per cent better than difficulty of obtaining supplies is increasing, August of last year. Oklahoma was 10 per owing to the diverting of essentials to war cent short in production compared with the channels, but patrons are taking what they can Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL EESERVE BULLETIN. 993 get without complaining. With such condi- Rains have fallen over a large area of the tions retailers are able to clean up stocks on district and the agricultural outlook is more hand at good prices. Department stores report promising than for several weeks past. While trade surprisingly large, while in dry goods and too late to be of benefit to cotton, except in shoes it is especially good on medium lines. parts of north, northeast, and east Texas, The millinery trade is active, with liberal coun- where the crop was in condition to better withtry orders. Demand for men's clothing and stand the excessive heat and drought, the •furnishings is less this fall than the trade has moisture has put a good season in the ground, known, Being further influenced by the new revived pastures and meadows, and will permit draft, but good prices are maintained. De- of extensive fall plowing and seasonal preparamand for groceries is active and at high prices. tions for next year's crop. Collections are good and cash purchases are The cotton crop is being rapidly marketed, proportionately larger than for spme time, though in some quarters reports indicate a disenabling merchants to pay- their bills. Busi- position to hold in anticipation of higher ness failures are at a low ebb. The August prices. As previously reported, the crop "sufrecord for the Tenth Federal Reserve District fered a heavy deterioration during August. was 20 failures, with $184,171 liabilities, as While earlier estimates, which we believe concompared with 58 failures, with $450,646 lia- servative, placed the Texas yield at around bilities, in August, 1917. 3,000,000 bales, more recent advices are that the crop may not exceed 2,500,000 bales. DISTRICT NO. 11—DALLAS. The demands of our member banks are still Trade continues in good volume and the out- heavy, and although some liquidation has taken look at present is generally promising, con- place, with the marketing of cotton, it is as yet sidering the uncertain conditions which have hardly noticeable. Another 30 days, however, prevailed for some time past, and continue should bring relief to banks, and there should more apparent, as the result of the war, when be a more general liquidation. Such reports considered in connection with the severe of condition of member banks, on the call drought which has prevailed over a large part of August 31 as have been received and of the district. Notwithstanding the higher analyzed, indicate a slight decrease in loans prices of all merchandise and an unusually hot and a corresponding increase in deposits, summer, when a slump in trade is to be ex- since the June report was rendered. pected, merchants report that trade largely Clearings at the principal cities of the disexceeds last year, and returns for the season trict in August were 8278,627,473, an increase are quite satisfactory. As in other districts, of 33.1 per cent over the same month last year, however, there continues a strong tendency when $209,316,620 was reported. to curtail the purchase of luxuries and non- Currency orders for crop moving purposes essentials and restrict buying to necessities have been unusually heavy during the past only. month, and. the outstanding Federal Reserve Wholesalers and jobbers, with few excep- notes of this institution have increased some tions, report that traveling salesmen are book- $20,000,000 during that period. ing good orders, and their volume is far ahead Post-office receipts at the principal cities of of last season. Recent rains over most of the the district show an increase of 39.2 per cent agricultural belt have materially helped busi- for August over the same period a vear ago. ness and stimulated buying among the country The detailed figures are: 1917, $310,315; 1918, trade. In the west and southwest, however, $432,128; increase, $121,813. where conditions have been unfavorable on The building industry is inactive, and while account of drought, general business is rather the number of permits issued at the principal quiet and buying is restricted. Orders from cities of the district in August show an increase those sections are not as heavy as in previous of 236, a decrease of 62.6 in valuation is seasons. Collections there are also slow. reported during the same period. All building The large mail-order houses of the district operations are subordinated to the Governare transacting a good business, and an increase ment's needs, and other than construction of from 25 to 40 per cent in sales is reported necessary for actual requirements no large over last year. This increase is applicable to contracts are undertaken. all classes of merchandise rather than any The lumber trade is unsettled, due to govspecial line. ernmental restriction, and the outlook at this Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

994 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. time is not promising, although the belief is ience to both producers and banks. Wareprevalent that no undue hardships will be housing facilities are too limited to provide for imposed. The various governmental depart- the accumulating products. War industries are ments are still calling for large orders of mate- steadily expanding under increasing demands, rial, and such requests are receiving first con- although some have been handicapped by insideration by producers. There is, however, ability to obtain materials. only a limited production of logs applicable to There is a continued shortage of water for1 Government requirements, and the disposition irrigation and power in northern California. of the accumulation of stock remaining pre- Some little relief was given by rains September sents a serious problem. The car supply is 12 and 13 with unusual precipitation for that still inadequate, but it is better than usual at time of year, amounting to 3.56 inches in this season. The mills report a labor shortage, Sacramento, 2.53 inches in San Francisco, and which it is expected will be further aggravated 6.25 inches in the Santa Clara Valley. Collecby the operations of the new draft. tions are good and retail business is limited by The labor situation in the district presents no inadequate supplies. material changes since our August letter. With strong demand for loans, interest Very little shortage is apparent in skilled labor, rates remain firm at 6 per cent in industrial although the new draft will have a serious and 7 per cent in agricultural centers. Ineffect, and tend to accentuate the shortage creasing returns from crops should offset the now existing in some localities. borrowing demand in agricultural districts. Live-stock conditions are improved some- There is growing recognition among bankers of what, as the result of partial rains over the the district of the importance of discriminating range country. In New Mexico, particularly, against extensions of credit for nonessentials, more encouraging reports are received, and our but frequently the fear of losing a profitable correspondents in Albuquerque, Roswell, and account to a competitor prevents desirable rethat vicinity, advise that cattle will go into striction, which could be had if the bankers of the winter season in fair condition. Farther each city would act jointly. to the west and southwest, however, the rain Total discounts by this bank from August did not so materially relieve range conditions, 1 to September 19 increased from $86,000,000 and the situation as regards live stock is to $112,000,000. Of the latter amount discouraging. $43,000,000 were secured by Government obli- To summarize general business and banking gations, having increased from $20,000,000 on conditions in the district, it may be conserva- August 1. The district's total subscriptions to tively stated that while the effects of the war five issues of United States certificates of are everywhere felt, and adjustments are being indebtedness have aggregated $212,250,000, made accordingly, the outlook is as promising the quota being $211,900,000. as could be expected. As the cotton crop is Bank clearings for 20 principal cities of the marketed, the excellent price of the staple will district in August increased 24 per cent over put money into circulation in the more favored the corresponding month of 1917. Portland, agricultural sections and tend to largely offset Tacoma, Seattle, San Francisco, and Los the situation in the w^est and southwest, where Angeles increased 81, 70, 64, 13, and 8 per a two years' drought has all but paralyzed the cent, respectively. Building permits for 17 cattle industry and farming pursuits. We see cities amounted to $5,629,000, increasing 15 nothing alarming in the conditions obtaining, per cent over the previous month and 26 per although conditions can not become normal cent over August, 1917. The increase is until the cattle industry of the west is on its found principally in the coast industrial feet, farming again active, and the war ends. centers. The Government report of September 1 DISTRICT NO. 12—SAN FRANCISCO. gives the following estimated production of During the last month there has been great grain, hay, and potatoes for the district: activity in all essential lines of commerce and industry in this district. Harvesting of the great variety of crops of the district is well 1918 1917 along, and first returns are being received. Wheat bushels 82,369,000 70,899,000 Delayed payments for Government purchases Oats do.. 39,380,000 43,037,000 and postponed selection by the Government of Barley do.. 49,987,000 59,573,000 Com do.. 7,833,900 7,263,000 those portions of food products whieh have Potatoes do.. 34,561,000 47,158,000 been commandeered are causing inconven- Hay tons 8,936,000 11,591,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBEE 1, 1918. FEDERAL EESERVE BULLETIN. 995 Rice in California on September 1 was rated June of 250,697 barrels. Stored stocks inat 90 compared with 83.7 for the United creased from 25,424,337 barrels on July 1 to States, forecasting a yield of 6,318,000 bushels 25,632,813 barrels on August 1. Stored stocks compared with 5,600,000 bushels in 1917. on August 1, 1917, were 35,781,323 barrels. Prune growers of Oregon and California At rortland, Oreg., and Salt Lake City about have been requested by the Food Administra- 15,300,000 and 15,000,000 pounds, respectively, tion to make no shipments of any part of of the 1918 clip of wool nave been received. their crop until the Government requirements, Of these amounts only 10 per cent had been estimated at 65,000,000 pounds, have been graded and paid for on September 1, the reprovided for. The Oregon crop is estimated mainder being stored in warehouses. at about 50,000,000 pounds, the largest that During the first half of 1918 coal production State has ever produced. The California crop in Utah increased 20 per cent over the correwas estimated September 1 at 150,000,000 sponding period of 1917. The same rate of Sounds, but it is feared that the damage done production for the remainder of the year is y the unseasonable rainfall of September 12 expected. Utah consumes 41 per cent of this and 13 will decrease the California crop production, the remainder going to adjacent possibly as much as 40 per cent, so that only States. a small supply may be available for civilian In 1917 Arizona was the leading copper proconsumption. ducing State of the Union, with a production Carload shipments of fresh fruits from Cali- of 712,166,891 pounds, 38 per cent of the counfornia this season to September 17 are 17,118 try's output. This was 9,666,278 pounds less cars compared with 13,434 cars to the same than the production of 1916. With more setdate last year. tled labor conditions this year all previous The September 1 Government report gives figures will probably be exceeded with an outthe condition of cotton as 92 in California and put estimated at more than 800,000,000 pounds. 96 in Arizona compared with 55.7 for the Gold production in California in 1917 United States. A yield of 100,000 bales is ex- amounted to $20,087,504 compared with a propected in California compared with 67,000 duction of $21,410,741 in 1916. Owing to the bales last year. In Arizona a crop of about increasing cost of labor and supplies, gold 52,000 bales is predicted compared with 35,000 mining is showing a continually decreasing bales in 1917. About 80 per cent of the Ari-! profit and the 1918 output will fall materially zona crop is of the Pima variety of EgyptianI below that of 1917. long-staple cotton. Shipbuilding continues to be the most prom- On September 1 the condition of oranges, inent industry of the district. Although hamaccording to the Government estimate, was 65 | pered by a shortage of unskilled labor and slow compared with 50 in 1917 and 84 for the 10-year deliveries of materials from the East, the westaverage, and the condition of lemons was 86 ern shipyards continue to lead those of the compared with 55 in 1917 and 84 for the 10- country in speed of production. The pennants year average. awarded monthly by the Emergency Fleet During the past month the lumber producers Corporation to leading ship constructors were of the Pacific Northwest have maintained nor- won in July as follows: mal production, about 80,000,000 feet weekly. The draft is naturally disorganizing the lumbering forces, and the difficulties of lumber pro- Steel-ship Wooden-ship constructors. constructors. ducers are further increased by inability to secure needed supplies such as steel cable. First place pennant... Seattle, Wash Aberdeen, Wash. Petroleum production in California during Second place pennant. Alameda, Cal Portland, Oreg. Third place pennant.. Portland, Oreg Kearney, N. J. July was 8,737,629 barrels, an increase over Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

996 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. COMPARATIVE STATEMENT OF LEADING BANKS OF ISSUE, 1914 AND 1918, Tn continuation of similar figures printed on ments were rearranged and combined under pages 681 of the September, 1917, JBULLETIN uniform heads commonly used in American there is presented below a comparative state- bank statements. This necessarily implied ment showing the condition of the leading cen- some arbitrary grouping, especially in cases tral banks of issue in 1914 immediately pre- where the true meaning of the original items ceding the outbreak of the war and correspond- | seemed doubtful. It is believed, however, that ing dates in 1918. Figures have also been the figures in the statement are on a fairly added showing changes in the condition of the comparable basis, and show quite clearly the Federal Reserve Banks between the end of 1914 relative effect of the war upon the principal and the last Friday in July of the present year. assets and liabilities of these banks since its As in the previous number of the BULLETIN, commencement. the principal items in the foreign bank statej Comparative statement showing principal assets and liabilities of the leading central banks of issue at dates specified. [In thousands of dollars; i. o., 000 omitted.] Fede B ra a l n R k e s s . erve Bank of England. Bank of France. Bank of Italy. Re G ic e h r s m b a a n nk. Ne B th a e n r k la o n f ds. De 1 c 9 . 1 4 3 . 1, Ju 1 l 9 v 1 8 2 . 6 , ' Ju 1 l 9 y 1 4 2 . 9, Ju 1 l 9 y 1 8 3 . 1, Ju 1 l 9 y .1 3 4 0 . , Ju 1 l 9 y 1 8 2 . 5, De 1 c 9 . 1 4 3 . 1, Ju 1 n 9 e 1 8 2 . 0; Ju 1 l 9 y 1 4 3 . 1, Ju 1 l 9 y 1 8 3 . 1, Ju 1 l 9 y 1 4 2 . 5, Ju 1 l 9 y 1 8 2 . 7, ASSETS. Gold coin and bullion 241,321 1,962,572 f 799,279 655,128 J 159,161 298,261 558,653 65,140 287,479 Silver and other metallic il85,567 327,318 [-236,633 reserve 17,823 8,800 1 120,689 53,491 I 14,914 65,409 28,659 3,307 3,133 Total metallic vault reserve 259,144 1,971,372 185,567 327,318 919,968 708,619 236,633 174,075 363,670 587,312 68,477 290,612 Gold held abroad 11,628 393,162 281,643 8,195 112,919 Government securities: Bonds, consols, etc 205 40,090 f 41,019 41,067 S O h th o e rt r - t G er o m ve s r e n c m u e ri n ti t e s s e . - 16,922 |l43,343 374,969 1 963 663,920 105,865 868,999 I 7,960 440,663 5,003 5,091 curities . . . 8,755 46,329 I 38,600 3,686,300 13,102 Total 8,960 103,341 143,343 374,969 80,582 4,391,287 105,865 882,101 7,960 440,663 5,003 5,091 Notes of other banks of issue 4,624 11,277 a 5,416 29,700 2,740 745 Loans and discounts 9,909 1,507,425 23*6,222 519,6S0 471,746 420,339 180,297 835,624 495,296 3,805,299 35,430 24,447 Advances on bullion and specie, securities, merchandise, etc 146,443 172,913 29,180 113,198 48,121 1,998 24,798 45,144 Securities 734 39,468 42,595 94,392 29,465 3,612 3,600 Sundry assets 9,237 13,245 77,173 247,735 28,618 30,262 51,901 435,823 928 39.831 Total 292,608 % 618,288 559,132 1,221,967 1,695,912 6,615,698 633,690 2,220,474 1,064,081 5,301,305 138,248 408,725 LIABILITIES. Capital paid in 18,051 76,441 70,822 70,822 35,222 35,222 34,740 34,740 42,840 42,840 8,040 8,040 Surplus 1,134 16,992 16,713 8,206 8,292 13,515 18,037 17,726 22,569 2,011 2,042 G O o th v e e r r n d m ep e o n s t i t d s eposits 263,948 1,4 2 0 3 1 3 , , 1 0 0 4 7 0 2 6 6 1 4 , , 8 8 6 3 9 0 1 67 8 3 3 , , 7 9 2 0 3 0 1 7 8 3 2 , , 8 8 3 8 4 1 7 2 4 6 2 , , 7 1 1 0 0 3 1 4 1 0 8 , , 3 0 2 3 0 5 6 7 5 5 6 9 , , 5 5 5 4 9 1 \ 299,515 2,024,160 1,904 30,865 Bank notes in circulation. 10,000 1,881,919 184,566 276,760 1,2S9,885 5,625,577 417,352 1,465,731 692,442 3,023,671 124,796 365,719 Sundry liabilities 24,647 53 49 105,914 177,794 9,728 4,948 11,558 188,065 1,497 2,059 Total 292,608 3,818,288 559,132 1,221,967 1 695,912 6,615,698 633,690 2,220,474 1,064,081 5,301,305 138,248 408,725 Includes 11,737,000 of foreign bank notes. 6 Overdraft. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 997 Comparative statement showing principal assets and liabilities of the leading central banks of issue of dates specified—Continued. National Bank, K S ik w s e b d a e n n k . , No N rg o o r s w B ay a . nk, C D op e e n n m h a ag rk e . n, Bank of Spain. Swis B s a N n a k t . ional Bank of Japan. July 31, June 29, July 31,1 July 31, July 31, July 31 July 24, July 27, July 23, July 31, June 30, July 27, 1914. 1918. 1914. 1918. 1914. 1918. 1914. 1918. 1914. 1918. 1914, 1918. S G i o lv ld e r c a o n in d a o n t d h e b r u m ll e io ta n llic reserve— 24 1, , 4 7 0 4 8 6 >9,144 4,405 32,902 o24i ,4A1m0 |/| 50', 6 8 4 5 6 9 I 1 1 4 0 3 5 j0 ,7 6 9 3 8 4 1 1 3 3 0 , , 7 3 2 7 8 4 ! ! 3 3 , 4 6 , 5 7 6 53 7 1 3 0 , , 8 4 4 9 7 5 258,757 325,272 Total metallic vault reserve.. 26,154 14,405 32,902 24,410 51,505 | 248,861 544,102 | 38,409 | 84,342 258,757 325,272 Gold held abroad 4,550 Foreign credits 13,564 9,199 8,166 16,566 17,149 18,774 i Government securities: I Bonds, consols, etc 67,047 95,426 !l 17,339 10,956 Short-term securities . 17,332 125,853 2,399 3,494 V---. -- *85 Other Government securities.... "29,"i99 "i^oo'i] ' il 11,176 16,611 Total. 1 7,332 125,853 | 2,3 3,494 96,246 114,726 ! 3,829 ; 28,515 | 28,052 Notes of other banks of issue a 1,893 2,307 ! Loans and discounts , 42,303 .2,737 i 23,6 844,970 27,098 | 60,425 152,579 168,372 18,099 56,925 | 76,061 20,697 Advances on bullion, and specie, securities, merchandise, etc , 28,287 . 3,106 I 2,699 10,100 ! 130,675 Securities 1,484 !. 7,974 2,249 2,446 1,919 i 9,775 Sundry assets 813 41,133 •. 9,627 \ 13,228 5,594 7,645 ! 204,488 286,760 Total. 92,059 238,203 j 66,548 j. 861,451 i,67,247 169,310 | 577,598 '791,456 Capital paid in 11,900 13,400 7,236 i , 28,950 4,825 4,825 18,675 IS, 675 Surplus ! 2,975 3,350 2,199 ; 5,404 471 664 18,551 19,944 G O o th v e e r r n d m ep e o n s t it d s e . posits . \ j11O8> 4 . 4 A0n 29,925 19,933 5,496 22,731 / \2 a 3 0 1 , , 3 9 7 0 0 5 |-28,819 22,104 / \ 2 5 1 4 0 , , 5 9 8 1 5 3 37 1 1 8, , 0 3 6 7 9 1 Bank notes in circulation 54,367 178,895 32,859 99,744 39,525 97,908 373,557 568,267 83,176 137,759 274,854 362,616 Sundry liabilities 4,377 12,633 12,092 30,365 2,606 3,958 18 781 Total. 92,059 238,203 66,548 861,451 67,247 169,310 577,596 4791,456 1 Includes both Government and corporate securities. 2 Included foreign bank notes; also drafts and bills payable at sight. > Due from Government in current account. « Does not include 59,017,000 yen=S29,419,975 of fractional paper currency, issued by the Government and reported among the bank's liabilities: also an equal amount held by the bank for redemption of said currency and reported among the bank's assets. NOTE.—For latest statements of the Russian State Bank (Oct. 29,1917) and the Austro-Hungarian Bank (Dec. 7, 1917) see pages 244-245 of the March (1918) BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

998 FEDERAL RESERVE BULLETIN. OOTOBKB 1, 1918. Reserves, Circulation, and Security Holdings of volume of bank notes outstanding, the Bank of the Banks of England and of France; also of France having a monopoly of note issue. For the German Reichsbank. the nine months under review the note circulation of the Bank of France shows an increase In the following tables and accompanying of 6,743 million francs, or over 1.3 billion doldiagrams are shown changes in the reserves, lars (at the nominal rate of 19.3 cents per notes, circulation, and security holdings of the franc). The gold vault reserve of the bank three leading European banks since the end increased meanwhile by over 100 million francs, of November, 1917. These tables are in con-while the ratio of this reserve to notes in circutinuation of similar tables printed on pages lation declined from 14.5 to 11.5 per cent. 943-946 of the December, 1917, BULLETIN. BANK OF ENGLAND. The statement for the Russian State Bank has [In millions of pounds sterling and dollars.] been dropped for the reason that the bank has g ubiished no accounts for a date later than T si o lv ta e l r g in ol i d s s a u n e d B la a n n d k n o o f t e E s n i g n - rota! securities 'ctober 29, 1917, for which date the figures are and banking actual in banking shown in the December publication. departments. citculation. department. Date. Since November, 1917, the circulation of notes issued by the three leading institutions, Mil- Mil- Mil- Mil- Mil- | Millions of lions of lions of lions of lions of lions of especially the French and German banks, has pounds. dollars.pounds. dollars.pounds, dollars. shown a continuous increase, largely in response to the cash requirements of the Governments. 1917. Nov. 28 56.5 275.0 43.1 209.7 150.2 730.9 In Great Britain the increase in circulation is Dec. 26 58.3 283.7 45.9. 223.4 153.2 745.5 made up not merely of the additional 70.6 mil- 1918. lions of Bank of England notes, but to a much Jan. 30 58.6 285.2 45.9 223.4 147.8 719.3 Feb. 27 59.4 289.1 47.3 230.2 155.0 754.3 larger extent of new currency notes issued by Mar. 27 60.6 294.9 47.8 232.6 168.3 819.0 the Treasury principally against commercial Apr. 24 61.0 296.9 48.4 235.5 161.6 786.4 May 29 , 63.5 309.0 51.1 248.7 163.2 794.2 paper deposited by the "banks of the country. June 26 65.2 317.3 53.7 261.3 152.5 742.1 July 31 67.3 327.5 56.9 276.9 165.4 804.9 On August 28 of the present year the amount Aug. 28 69.5 338.2 57.6 280.3 158.7 772.3 of these notes outstanding was SI,303,463,000, as against $944,757,000 on November 28, 1917, BANK OF FRANCE. while the gold cover against these notes re- [In millions of francs and dollars.] mains unchanged at $138,695,000. In Ger- Notes in circula- War advances to many, besides the considerable increase in the Gold in vault. tion. Government. circulation of Reichsbank notes, there has been Date. o an f e lo v a e n n l b a a rg n e k r n re o l t a e t s i , v e t h g e a in s o i - n ca t ll h e e d c D irc a u rl l e a h ti n o s n - o M f f il r l a io n n c s s. l d io o M n ll s i a l - o rs f . o M f i f l r l a io n n c s s. M do il l l o l i a f o r n s s . o M f i f l r l a io n n c s s.l d io o M n ll i s a l - r o s f . Tcassensclieine. The amount of such notes in 1917. circulation on August 23 of the present year Nov. 29 3,296.3 636.2 22,690.9 4,379.3 12,550.0 2,422.2 Dec. 27 3,314.4 639.7 22,336.8 4,311.0 12,500.0 2,412.5 was 7,934 million marks, compared with 5,860 1918. million marks on November 30, 1917, as Jan. 31 3,325.1 641.7 23,534.3 4,542.1 12,800.0 2,170.4 Feb. 28 3,331.0 642.9 24,308.3 4,691.5 12,950.0 2,499.4 against an increase in the circulation of Reichs- Mar. 28 3,336.4 643.9 25,179.3 4,859.6 14,000.0 2,702.0 Apr. 25 3,341.8 645.0 26,395.3 5,094.3 15,650.0 3,020.5 bank notes from 10,622 million marks on No- May 30 3,346.6 645.9 28,012.2 5,406.4 17,500.0 3,377.5 vember 30 to 13,639 million marks on the last June 27 3,361.7 648.8 28,550.4 5,510.2 18,450.0 3,560.9 July 25 3,394.4 655.1 29,148.1 5,625.6 18,900.0 3,647.7 of August of the present year. As the amount Aug. 29 3,398.3 655.9 29,434.0 5,680.8 19,150.0 3,696.0 of Imperial Treasury notes in circulation re- GERMAN REICHSBANK. mained almost constant at about 345 millions [In millions of marks and dollars.] during the entire period, the increase in national Notes in circula- Discounts and paper currency between the end of November, Gold in vault. tion. advances. 1917, and the end of August of the present year Date. Millions Mil- Millions Millions Millions Milwas in excess of 5 billion marks, or about 1.2 of lions of of of of lions of billion dollars (at the nominal rate of 23.8 cents marks. dollars. marks. dollars. marks. dollars. per mark). As against this enormous increase 1917. in paper circulation the gold reserve of the Nov. 30 2,405.3 572.5 10,622.3 2,528.1 12,234.2 2,911.7 Dec. 31 2,405.6 572.5 11,467.7 2,729.3 14,596.1 3,473.9 Reichsbank shows a decline from 2,405 to 2,348 1918. million marks, the per cent gold cover of the Jan, 31 2,406.1 572.7 11,138.9 2,651.1 13,105.5 3,119.1 Feb.28 2,107.8 573.1 11,310.8 2,692.0 13,048.5 3,105.5 total circulating notes showing a decline from Mar. 30 2,408.5 573.2 11,977.8 2,850.7 16,034.3 3,816.2 Apr. 30 2,344.0 557.9 11,820.8 2,813.4 13,887.8 3,305.3 14.3 to 10.7 per cent. Mav31 2,345.7 558.3 12,002.7 2,856.6 14,544.7 3,461.7 It is only in France that the increase in paper June 29 2,346.2 558.4 12,510.4 2,977.5 16,670.9 3,967.7 Tuiy31 2,347.3 558.7 12,704.5 3,023.7 15,988.5 3,805.3 circulation is measured by the increase in the Aug. 31 2,318.1 558.8 13,639.1 3,246.1 17,674.2 4,206.5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

II po. GOLD IN VAULT, BANK NOTES IN CIRCULATION, ETC, OF THE BANK OF ENGLAND, SINCE THE OUTBREAK OF THE WAR. noo- f/00 tOOQ- WO WO 800 Vwo- 700 JKL 600- 600 il 3 sv: 500 3 400- 400 !! B 300 300- ZOO 200- Carve /.* Gold an&Silver in Issue and,.j8anJC£ng &eftardfnerUs. JYbtesiuJlctwalfa Curve 3.SecuuritCes in, JSanlCuig Befwrdm&n^. CO CO i CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

o GOLD IN VAULT, BANK NOTES IN CIRCULATION, ETC, o o OFWE BANK OFFRANCE.SINCE WE OUTBREAK OF THE WAR. 5500 £ y 5QC0 A / / 4600 / toCl/ / 4000 d/yn J 3500 r / 3500 i I 3000 30® i / 1 J B500 / 2500 r r*y^ r"""i H 1 ZOOO 2000 A II ? — tsoo r 7 /SCO V w \ fOOO \A *^* \ 1000 ^__ terra SCO SOO n J&I4- 1 . I&1J5 I I&I& \ 13 IF I I&I8 I Curve!: Gol&inYauU;. Carpe£.J^tesinCzrazl€it£ori. Curre3iJldvancestothe6overmtwrWsi^^ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6OLD IN VAULT, BANK NOTES IN CIRCULATION, ETC., OF THE OERMAN REICHSBANK, SINCE THE OUTBREAKOFTHE WAR. / 4O00 -i / 3500 i '-, 350? • 1 V ^ I 7 — )3000 s 3000 r / i / kf J Jy I \2500 w / \ )] 3500 w / \ / / \ / V if / \1 b /—-<H ZCOO \ kr r 2000 s Y 4 n / A 1500 i N M /\ 15001 ( - • M h f s -i M •y 1000 -&f "' \ \r- n 1000 J 4y 500 P3 =F SOO O I*Is ii \% it nn w SI §5 is- g H / M si IIi\ nM I' is 0 Li T" r77 Curve!: Gold, uCVcuuJU;. Cuurve£.'JVoCesin- Circulation. Cvurve3: J&ills discounted, vnd. Jreasury ^SUls and Jldvances. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1002 FEDERAL RESERVE BULLETIN. OCTOKHR 1, 3 018. REPORTS OF BANK TRANSACTIONS. accounts with the same bank does not appear in the figures of debits to bank account. On In the accompanying table are given figures the other hand, a check passing between two of debits to deposit account of clearing-house individuals carrying accounts with separate banks in about 125 cities for the weekly periods banks may pass through a number of other ending Wednesday, September 4, 11, 18, and banks in its course from the payee's bank to 25, in continuation of similar tables in the the drawer's bank, giving rise to a debit to September Federal Reserve Bulletin, giving bank account on the books of each of the banks data for three weekly periods in the month of through which it passes, until it reaches the August. The number of centers from which bank on which it is drawn. As a result, figures reports are received has been gradually in- of debits to bank account are not inclusive of all creased, and arrangements are being perfected business transactions, and on the other hand whereby data for practically all the important comprise duplications and reduplications of centers will be sent to the Federal Reserve such transactions whenever the checks in set- Board for use in its consolidated weekly tlement of such transactions pass through more statements. than one bank. Debits to bank account as an Separate figures are shown for debits to index of business transactions are thus subject individual account and for debits to banks' and to the same objections as are generally raised bankers' account. In a considerable number of against figures of clearings where used as a like cases the earlier reports published in the pre- index.- The debits to bank account have, vious issue of the "BULLETIN gave merely one however, their specific use, as they show the combined total for both items, but at the re- volume of interbank transactions as distinct quest of the Board separate figures are now from debits to individual account, which repreported by practically all centers. Debits to resent the volume of business transactions. It individual account represent the volume of follows that a cumulation of these two classes business transactions, while debits to banks' of items is not only of little value, but may be and bankers' account represent the volume of positively misleading. It is for this reason interbank transactions. The former give rise that figures for the two items have not been to and are partially represented in the latter. combined in the tables which follow. A check passing in settlement of a business Figures of reporting clearing houses by Fedtransaction between two individuals carrying eral Reserve districts are as follows: Weekly figures of clearing-house bank debits to deposit account. [In thousands of dollars; i. e., 000 omitted.] Debits to individual account. Debits to banks, and bankers' account. District. Sept. 4. Sept. 11. Sept. 18. Sept. 25. Sept. 4. Sept. 11. Sept. 18. Sept. 25. No. 1—Boston: Bangor 2,429 2,733 2,346 2,386 334 432 462 445 Boston 170,111 204,212 219,705 200,072 141,030 176,730 199,692 191,703 Fall River 5,452 7,045 6,778 7,419 238 319 443 191 Hartford 19,875 16,914 1,092 1,138 Holyoke 2,395 2,547 2,801 2,930 37 516 840 693 Lowell 3,858 4,724 5,563 4,120 154 287 261 316 New Bedford 4,477 5,005 5,837 5,674 122 224 390 135 New Haven 13,193 13,456 14,363 12,603 416 389 531 279 Portland 6,905 7,889 6,155 2,856 2,893 2,810 Providence 21,048 23,174 26,531 25,383 1,363 1,373 1,651 1,474 Springfield 6,295 7,391 7,830 7,631 112 185 153 133 Waterbury 6,947 6,809 7,726 6,485 498 319 370 356 Worcester 11,622 12,609 14,323 12,728 824 899 843 1,572 No. 2—New York: Albany 14,485 15,563 15,205 19,497 10,866 15,063 12,082 12,659 Binghamton 2,147 2,623 2,923 2,561 * Buffalo 47,253 55,276 60,532 58,231 9,709 i3,967 14,769 12,895 New York 2.997,636 3,512,698 3,014,507 3,077,011 1,267,249 1,432,572 1,511,209 1,548,827 Passaic ' 2,788 3,385 3,984 3,544 218 130 295 317 Rochester 19,835 19,992 23,706 20,894 342 495 534 555 Syracuse 10,575 7,233 13,205 8,292 800 395 No. 3—Philadelphia Altoona 1,812 3,595 2,135 2,672 Chester 4,416 4,716 5,768 5,125 7 Harrisburg 5,350 6,439 6,410 5,981 140 249 198 22 Johnstown 2,952 2,180 1,634 1,371 Lancaster 3,478 4,198 4,340 4,005 19 24 Philadelphia 260,842 259,117 282,786 277,000 258,627 307,667 288,910 291,868 Reading 4,859 4,151 5,480 6,419 1 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1003 Weekly figures of clearing-house bank debits to deposit account—Continued. [In thousands of dollars; i. c, 000 omitted.] Debits to banks' and bankers' account. District. Sept. 25. No. 3—Philadelphia—Continued. Scranton 10,945 Trenton 9,422 Wilkes-Barre 5,810 Williamsport 2,915 ! Wilmington 7,972 York 2,896 No. 4—Cleveland: Akron 14,305 Cincinnati 51,334 51,442 Columbus. 21,946 21,221 Dayton. 11,006 10,968 Erie.... 7,054 6,445 Greensburg, Pa, 2,705 2,639 Lexington, Ky, 3,302 3,357 2,535 2,630 Newcastle 1,958 2,033 1,949 2,082 l!o37 1,617 Oil City 2,132 3,385 2; 614 2,465 Spiingfield 3,136 2,623 2,643 2,181 2,693 2,187 Toledo 17,012 21,856 23,786 20,880 7,906 7,361 Wheeling 9,183 6,887 7,482 9,033 9,121 Youngstown 6,183 15,857 11,138 11,835 34 27 No. .5.—Richmond: Baltimore 68,713 76,302 73,294 I 76,175 39,807 Charlotte 5,788 8,271 Norfolk 17,145 ! 15,911 i 23,838 23,836 Raleigh 3,266 ! 3,574 j. 1,813 2,419 Richmond 19,829 24,125 21,218 I 23,112 i 48,930 66,394 65,193 70,589 No. 6.—Atlanta: Atlanta 19,172 | 22,173 23,339 I 24,575 ! 15,755 22,826 22,136 27,394 Augusta 6,625 | 9,662 9,946 j 10,728 ' 889 1,690 3,436 3,516 Birmingham 12,680 i 12,330 12,040 j 13,680 2,513 3,664 3,900 4,574 Chattanooga 7^763 ! 9,308 8,753 ! 8,720 3,004 4,552 I 4,285 4,802 Jacksonville 7,445 I 9,056 9,750 9,388 3,887 6,381 ! 5,905 5.531 Knoxville 5,513 5,955 5,657 4,918 1,042 1,601 I 1,493 1,229 Macon 5,666 ! 6,596 7,324 7,237 2,894 3,648 I 3,879 4,118 Mobile 5,594 6,021 6,193 , 6,323 662 841 i 969 966 Montgomery 3,398 4,485 5 222 ! 4,656 505 673 j 614 413 Nashville 18,094 20,047 19,242 19,891 12,251 13,852 ! 15.163 17,007 Now Orleans 48,477 53,884 52,791 54,256 31,341 i 32,006 i 40,538 40,556 Pgnsacola 1,727 ! 1,650 1,851 1,656 1,518 i 990 i 923 I 1,194 Savannah 13,099 16,580 17,602 15,664 7,307 ! 13,530 j 14,154 15,188 V Ta ic m k p sb a urg 3 1, , 2 0 6 3 6 0 3 1, , 4 2 2 5 8 3 3 1, , 5 6 6 8 6 6 3 1, , 6 4 2 8 9 5 7 S 1 o 4 I i 1 8 2 1 0 6 1, 2 4 3 9 4 5 1, 1 5 0 6 2 7 No. 7.—Chicago: Bay City. 2,251 2,233 2,390 2,383 j 371 I 516 4.42 j 420 Bioomington, 111. 2,273 2,432 2,258 1,947 i 940 j 843 1,011 730 Cedar Rapids 110,576 114,521 113,171 113,496 I Chicago... 428,084 396,781 610,176 527,579 441,922 ! 477,242 651,333 580,204 Davenport 5,306 6,002 6,200 5,972 | 2,192 ! 1,408 1.048 935 Decatur, 111 2,854 3,020 2,936 2,875 ! 709 i 855 '735 656 Des Moines i 35,595 j 148,944 143,640 i 39,717 Detroit 87,739 82,993 105,211 98,369 37,188 I 44,478 44,685 44,879 Dubuque 1,587 1,966 2,242 1,800 1,070 I 1,007 813 1,300 Flint. 1 3,580 1 5,107 13,283 4,105 47 Fort Wayne 3,657 5,663 4,312 5,408 1,241 1,817 1,504 1,250 Grand Rapids... 10,853 7,890 14,030 16,959 2,809 14,382 4,823 4,464 Indianapolis 22,457 26,754 30,759 29,184 20,500 25,874 26,372 22,982 Jackson, Mich... 12,872 1 2,633 Kalamazoo "2,532 i 3,085 2,995 2,993 376 462 421 372 Lansing 2,830 3,103 150 176 Milwaukee 30,552 ! 52,252 ""*54,"62o' 49,102 "18*756 32,564 29,337 28,541 Pooria 9,382 j 10,464 11,977 10,612 1,969 2,302 2,249 2,394 Rockford.Ill.... 3,659 I 4,654 4,448 4,370 85 62 168 126 Sioux City, Iowa 11,693 1,740 10,769 11,012 12,111 1,106 9.861 12,215 South Bend '897 I 4,429 3,004 2,838 2,314 1,932 1,970 1,759 Springfield, 111... 3,949 I 4,667 4,390 4,253 960 1,106 947 1,879 Waterloo, Iowa.. 2,392 l 2,832 2,901 3,224 819 1,309 772 947 No. 8.—St. Louis: Evansville 3,219 4,391 4,066 4,700 1,077 2,111 1,888 1,212 Little Rock 5,342 8,194 7,395 7,212 4,163 5,243 6,549 6,504 Louisville 20,720 25,250 27,091 26,120 11,320 15,600 14,787 14,986 Memphis 15,440 22,572 24,210 38,750 9,340 17,148 25,155 24,380 St. Louis 118,837 127,962 139,877 136,202 . 114,140 136,870 137,612 140,850 Springfield 1,299 I 1,185 No. 9—Minneapolis: Aberdeen 1,796 2,280 1,890 1,937 1,276 1,667 1,941 1,738 Billings 2,255 2,011 1,832 I 2,005 1,196 j 1,189 Butte 6,158 4,403 ! Duluth 14,033 30,259 52,535 63,802 I 5,518 6,600 I 3,624 Fargo 3,581 4,800 3,431 I 3,982 Grand Forks 1,468 2,079 Great Falls 3,275 3,602 6.216 I 6,837 1 Figures comprise debits to both individual as well as to banks' and bankers' account. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1004 FEDERAL BESEEVE BULLETIN. OCTOBER 1,191S. Weekly figures of clearing-house bank debits to deposit accounts—Continued. [In thousands of dollars; i. e., 000 omitted.] Debits to individual account. Debits to banks' and bankers' account. District. Sept. 4. Sept. 11. Sept. 18. Sept. 25. Sept. 4. Sept. 11. Sept. 18. Sept. 25. No. 9—Minneapolis. Helena 1,760 2,198 1,920 2,099 2,379 3,746 3,088 2,893 Minneapolis 6(5,058 107,739 113,331 53,761 80,645 93,723 99,859 St. Paul 23,086 33,357 35,696 28,180 40,597 43,385 45,691 Superior 1,401 2,238 2,235 2,145 113 91 141 193 No. 10—Kansas City: Atchison 1,216 913 1,064 321 67 59 0 545 Bartlesville.Okla.. 1,654 1,793 2,251 1,574 158 134 197 341 Colorado Springs... 1,929 2,401 2,484 2,274 642 • 559 511 452 Denver 22,255 29,216 26,395 25,303 15,015 21,414 22,749 20,278 Joplin 3,048 3,777 4,037 3,369 501 911 880 822 Kansas City, Kans. 2,283 3,356 3,032 3,719 4,806 5,440 5,763 5,754 Kansas City. Mo... 88,654 105,876 103,855 100,411 153,778 185,694 177,851 181,317 Muskogee, Okla 1,827 2,246 3,960 2,944 1,553 2,130 3,024 3,125 Oklahoma City 7,947 13,231 13,968 12,128 10,918 13,775 11,971 Omaha 62,186 74,663 i 59,811 76,350 48,948 70,254 61,410 66,772 Pueblo 2,106 2,903 2,804 2,394 559 792 754 998 St. Joseph 35,231 19,193 18,208 18,328 20,106 18,924 15,354 16,445 Topeka 3,620 4,848 4,354 4,122 1,204 2,792 1,720 1,731 Tulsa 10,937 15,067 18,168 15;626 6,847 7,930 8,222 8,081 Wichita 15,918 11,230 8,324 6,322 14,430 18,544 16,517 12,342 No. 11—Dallas: Albuquerque 981 Austin 2,464 3,252 3,786 2,742 5,510 5,929 4,793 3,119 Beaumont 3,069 3,816 3,736 4,146 362 460 458 432 Dallas 25,687 30,595 32,714 30,523 56,052 60,114 64.197 62,545 El Paso 3,720 4,393 5,216 4,878 4,650 6,083 5!945 6,210 Fort Worth 12,524 14,892 14,833 16,390 27,245 32,960 30,384 35,116 Galveston 6,669 7,919 7,869 7,252 6,136 5,578 7,219 6,982 Houston 35,547 29,614 25,775 36,715 49,232 60,188 58,131 59,911 Shreveport 4,488 6,031 5,854 5,639 2,470 3,428 4,436 4,431 Texarkana 1,231 1,289 1,849 1,228 254 354 428 512 Tuscon 1,413 1,449 Waco 4,455 5,073 3,738 4,368 3,357 3,183 No. 12—Sas Francisco: Fresno 5,614 4,802 6,262 6,262 4,577 4,137 5,762 5,362 Long Beach 1,905 1,640 2,098 2,004 49 43 40 76 Los Angeles 35,942 31,226 53,995 46,382 26,606 21,971 43,632 34,170 Oakland 9,274 10,527 8,194 12,015 1,800 2,308 2,492 3,255 Ogden 2,861 3,594 3,607 3,808 1,644 2,967 4 554 4,849 Pasadena 1,797 1,836 1,987 1,766 206 164 224 - 128 Portland 33,533 38,512 43,604 51,126 20,373 27,037 29,168 28,243 Reno 1,753 1,460 1,510 1,362 Sacramento 16,118 11,857 9,902 5,102 Salt Lake City 9,779 14,139 11,686 15,530 12,882 16,078 17,658 19,235 San Diego 4,015 4,591 5,040 4,480 281 241 193 447 San Francisco 148,046 103,734 Seattle 34,248 43,056 48,579 51,368 14,901 20,377 20,624 38,129 Spokane 6,814 9,989 9,865 9,742 7,312 9,317 10,090 10,394 Stockton 5,150 3,855 3,184 2,161 Tacoma 8,347 13,306 13,103 9,625 3,494 7,242 7,486 11,324 Yakima 1,610 2,290 1,750 1,568 100 179 145 212 Recapitulation showing figures for clearing-house centers reporting for each of the four weeks. [In thousands of dollars; i. e., 000 omitted.] Debits to individual account. Debits to banks' and bankers' account. Number of District. centers included. Sept. 4. Sept. 11. Sept. 18. Sept. 25. Sept. 4. Sept. 11. Sept. 18. Sept. 25. No. 1—Boston 11 247,827 289,705 313,803 287,431 145,128 181,673 205,636 197,302 No. 2—New York 7 3,094,719 3,616,770 3,134,062 3,190,030 1,289,184 1,462,227 1,539,284 1,575,253 No. 3—Philadelphia 12 316,512 322,028 350,000 341,162 259,088 310,306 291,030 294,066 No. 4—Cleveland 9 110,359 135,664 133,561 129,693 49,W?0 60,136 63,477 56,244 No. 5—Richmond . 2 88,542 100,427 94,512 99,287 83,472 106,320 103,304 110,396 No. 6—Atlanta 15 159,549 1S2,428 184,962 186,716 84,367 107,190 119,124 128,157 No. 7—Chicago 21 681,868 6S8,429 935,717 838,198 546,332 609,265 778,491 706,100 No. 8—St. Louis 5 183,558 1S8,369 202,639 212,984 140,040 176,972 185,991 187,932 No. 9—Minneapolis 6 108,134 163,767 199,676 219,010 88,377 132,264 148,868 153,998 No. 10—Kansas City 15 260,811 290,713 272,715 275,847 275,850 346,503 329,317 330,980 No. 11—Pallas 9 95,399 101,801 101,632 109,513 151,911 175,094 175,991 179,258 No. 12—San Francisco 13 155,739 179,508 209,770 215,676 94,225 112,061 142,068 156,824 Total 125 5,483,017 6,259,609 6,133,049 6,105,547 3.206,994 3,780,011 4,082,581 4,076,510 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1005 textiles. In some instances, the classification WHOLESALE PRICES. of commodities has been somewhat arbitrary, In accordance with the plans announced in as certain commodities are used both as prothe September FEDERAL RESERVE BULLETIN, ducers' and consumers' goods. Flour is a there are presented in the table below monthly consumers' commodity to the housewife and a index numbers of wholesale prices since Janu- producers' commodity to the baker. In such uary, 1914, using the average prices in the year cases the assignment has been made in accord- 1913 as a base. The general index number, ance with the principal use of the commodity. comprising at present 287 commodities, is that Again, it is often difficult to distinguish between of the United States Bureau of Labor Statistics, the classes of raw materials and producers' which has kindly agreed to place its compila- goods. Iron and lumber provide cases in tion of index numbers and data employed in point. The latter, while subject to some degree their construction at the disposal of the Federal of manufacture, is nevertheless believed to be Reserve Board for use each month in the most satisfactorily classed under the head of FEDERAL RESERVE BULLETIN. The technical "raw materials," and accordingly forms the method of construction employed by the forest products subgroup of the raw materials bureau has been described at some length in group. In certain cases, however, notably previous issues of the BULLETIN. with respect to certain foodstuffs such as In addition to the bureau's general index prunes, lemons, and milk, it was deemed number, separate numbers for certain particu- preferable for the present purpose to inlar classes of commodities are presented. The clude the commodity with the consumers' principle of grouping employed has been a goods group, although the manufacturing composite one. It is generally believed that process undergone may have been practically for the study of business conditions comparison negligible. of the prices of raw materials with those of Owing to the rapid change in the character manufactured products, and comparison of the of commodities on the market at the present prices of producers' goods with those of con- time, duo to conditions brought about by the sumers' goods, are of most significance. The war, the list of commodities included in both former may be termed an approach to the the general number of the Bureau of Labor problem from the supply side, the latter from and the several groups here presented is subthe demand side. In addition, the nature or ject to monthly revision. Prior to the present origin of the commodity, whether a farm, ani- year, revision of the list had been made yearly. mal, forest, or mineral product, is often taken The statistical methods employed insure coninto account. tinuity in the index number, so that figures It was deemed desirable to so classify the from month to month are entirely comparable. commodities included in the general index The list of commodities included in each of the number that the above comparison may be groups is given below. Changes in the list readily instituted. Each of the commodities will be noted from month to month and at included in the final number was assigned intervals the revised list will be published for to one of the groups, the composite of the purposes of convenient reference. The index groups thus coinciding with that forming the numbers for the latest month are provisional, basis for the general index number. The due to the fact that certain of the data are not grouping chosen comprises raw materials, in- received in time to render them available for cluding farm, animal, forest, and mineral use in the calculations. Up to the present, products; producers' goods, such as steel however, these changes have been so slight in rails, copper wire, and cotton yarn; and con- amount as to render unnecessary revision of sumers' goods, such as flour, beef, and cotton figures previously published. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1008 FEDERAL RESERVE BULLETIN. OCTOBER 1, 1918. UST OF COMMODITIES AT PRESENT INCLUDED IX EACH OF TILS GROUPS. .. RAW MATERIALS (69 articles)—Continued. A. RAW MATERIALS (69 articles). i. MINERAL PRODUCTS (23 articles)—Continued. Iron ore, Mesabi, Bessemer, 55 per cent, lower Lake ports. 1. IT AM PRODUCTS (16 articles): Barley, fair to good or standard grade matting, Chicago. Lead, pig, desilverized, New York. Corn, No. 2, contract; mixed, Chicago. Petroleum, crude, Pennsylvania, at wells. No. 3, mixed, Chicago. Pig iron, basic, f. o. b. Mahoning or Shen&ngo Valley Cotton, middling, New Orleans. furnace. upland middling, New York. Bessemer, Pittsburgh, H Fl a a y x , s e ti e m d, o N th o y . N lf o c . a 1 sh , , 2 M an i d n n 3 e w ap i o re l , i s C . hicago. | f f o o u u n n d d r r y y N N o o . . 2 2 , , n so o u rt t h h e e r r n n , , C Pi i t n t c s i b n u n r a g t h i. . Hops, prime to choice, State, New York. • Tin, pig, New York. Oats, cash, contract, Chicago. i Zinc, pig (spelter), western, New York, Rye, No. 2, cash, Chicago. ! .1.5. PRODUCERS' GOODS (77 articles): Tobacco, Burjey, good leaf, dark red, Louis\iiie. i Acetic; acid, 28 per cent. New York. Wheat, No. 1, northern spring, cash, Chicago. I Alcohol, denatured, 180 proof, New York. No. 1, northern spring, cash, Minneapolis. j grain, ISO proof, V. S. P., New York, No. 2, red winter, Chicago. wood, refined, 95 per cent, New York. No. 2, hard winter, Kansas City. Alum, himp, New York. bluestem, Portland. Ammonia, anhydrous, New York. Bar iron, best refined, Pittsburgh. 2. ANIMAL PRODUCTS (19 articles): Cattle, steers, choice to prime, heavy beeves, Chicago. I common, Pittsburgh, steers, good to choice, corn-fed, Chicago. j Borax, crystals and granulated, New York. Hides, Brazilian goatskins, New York. Brick, common, run of kiln, salmon, Chicago, calfskins, No. 1, country, 8-15 pounds, Chicago, common, red building, Cincinnati, green salted, packers', heavy native steers, Chicago. common, red domestic building, New York. green salted, packers', heavy Texas steers, Chicago. Carbonate of soda (sal soda), New York. Hogs, heavy, range fair to choice, Chicago. Caustic soda, 76 and 78 per cent, solid, New York. light, range common to good, Chicago. Cement, domestic Portland, spot, New York. Poultry, live fowls, Chicago. Copper sulphate, 95 per cent, crystals (blue vitriol), New York. live fowls, New York. Copper wire, bare, No. 8, B. & S. gauge and heavier (base size). Sheep, ewes, native, plain to fancy, Chicago. Cotton thread, 6-cord, 200 yard, J. <fc P. Coats. Cotton yarns, white, northern, mule spun, 10/1 cones, lambs, western, good to prime, Chicago, white, northern, mule spun, 22/1 cones. wethers, common to best, Chicago. Cottonseed meal, prime, New York. Silk, raw, Japan, special extra, 13/15, New York, Gasoline, motor, to garages. New York. raw, Japan, No. 1, Kansai, 13/15, Now York. Wool, Ohio, fine de laine, scoured. Glass, plate, polished, area 3 to 5 square feet, f. o. b. New York, Ohio, medium fleece, 1/4 and 3/8 grades, scoured. plate, polished, area 5 to 10 square feet, f. o. b. NQ~W York Ohio, fine clothing, scoured. window, Amerinnn, single, AA, 25 inches, 6 by 8 to 10 by Ohio, half-bred, scoured. 15, New York, 3. FOREST PRODUCTS (11 articles): window, American, single, B, 25 inches, 6 by 8 to 10 by Douglas fir, No. 1, common, surfaced one side, Washing- 15, New York. ton State. Glycerin, chemically pure, in bulk, New York. drop siding, No. 2 and bettor, Washington Jute, raw, M-double triangle, New York. State. Lath, eastern spruce, U-inoh siab, New York. Maple, hard and soft, lsts and 2ds, New York. Lead, carbonate of (whitfc lead), in oil, American, New York. Oak, white, plain mixed rock, mountain and West Vir- Lead pipe, New York. ginia stock, lsts and 2ds, Now York. Leather, chrome calf, dull or bright, range of B grades, white, quartered, New York. harness, California oak No. 1, Chicago. Pine, white, No. 2 barn, rough, New York rail. sole, hemlock No. 1, middle. white-, No. 2 uppers, rough, New York rail. solet-oak, scoured backs, heavy, Boston. yellow, flooring, long-leaf, New York. glazed kid, black, top grade, from Brazilian skins, North Carolina, surfaced, boards, Norfolk. Boston. Poplar, yollow, rough, New York. side, black chrome, Boston, Spruce, eastern, New York. tanned, B grade, Boston. •4. MINERAL PRODUCTS (23 articles): Lime, eastern, common, Now York. Coal, anthracite, broken, New York tidewater. Linen shoe thread, 10's, Barbour. anthracite, chestnut, New York tidewater. Linseed oil, raw, car lots, New York. anthracite, egg, New York tidewater. Lubricating oil, paraffin, 903 sp. gr., New York. anthracite, stove, New York tidewater. Malt, standard keg beer, New York. bituminous, run of mine (ICanawha), Cincinnati. Muriatic acid, 20 degrees, Now York. bituminous, prepared sizes, Chicago. Nails, wire, eightpenny fence and common, f. o. b. Pittsburgh, bituminous, run of mine, Chicago. Nitrate of soda (Chile saltpeter), 95 per cent, New York. bituminous, screenings, Chicago. Nitric acid, 42 degrees, Now York. bituminous, run of mine, St. Louis. Oleo oil, extra, Chicago. bituminous, prepared sizes, Pittsburgh. Opium cases. U. S. P., New York. semibituminous, Pocahontas, Norfolk. Paper, news-print, rolls, contract. semibituminous, run of mine, Cincinnati (New Pipe, cast iron, f. o. b. New York. River). Putty, common, New York. Coke, Connelisville, furnace. Rope, pure manila, first grade, base size, New York. Copper, ingot, electrolytic, New York. Rosin, common to good, New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBEB 1, 1918, FSDEEAL RESERVE BULLETIN. 1007 B. PRODUCERS' GOODS (77 articles)—Continued. , CONSUMERS' GOODS HI articles)—Continued. Rubber, Para Island fine, New York. -SP, western •ilrsvs, Boston. Shingles, cypress, best, 5 inches wide, 16 inches long. fresh firsts, Chicago. red cedar, clear, random width, 16 inches long. prime firsts, Cincinnati. Silver, bar. imo, New York. Louisiana, at the market, New Orleans. Soda ash, light, 58 per cent, New York. fresh gathered firsts, New York. Steel billets, Bessemer, Pittsburgh. western extra firsts, Philadelphia. plates, tank, •} inch thick, 6 to 100 inches wide, f. o. b. iresh extra selected pullets, San Francisco. Pittsburgh. Fish, cod, large shore (pickled, cured). rails, Bessemer, standard, Pittsburgh, herring, pickled, domestic, large, split, New York. rails, open hearth, standard. Pittsburgh, mackerel, sail;, large 3s. structural, Chicago. salmon, canned, Alaska red, New York. Sugar, 96 degrees, centrifugal, New York, Flannels, all wool, whice, Baliard Vale, Sulphuric acid, 66 degrees, New York. Flour, rye, pure, Minneapolis. Tallow, packers' prime, Chicago. wheat, new Admin, std., 95 por cent, from hard winter Tin plate, domestic, coke, 14 by 20 inches, f. o. b. Pittsburgh. wheat, Kansas City. Turpentine, southern, barrels, New York. wheat, standard war, from spring wheat, Minneapolis. Wire, barbed, galvanized, L o. b. Chicago. wheat, patents, Portland. plain, annealed, Nos. 6 to 9, f. c. b. Pittsburgh. wheat, from soft wheat, 95 per cent, St. Louis. Wood pulp, suiphits, domestic, unbleached, New York. wheat, patent, regulation, soft winter wheat, Toledo. Worsted yarns, 2-40's, hall" blood. Fruit, apples, Baldwin, fresh, Chicago. 2-50's, fine domestic. bananas, Jamaica 8s, New York. 2-32's, crossbred. currants, uncloaned, barrels, New York. Zinc, oxide of (white zinc), American, standard, Now York. lemons, California (300-360 count), Chicago. sheet, f. o. b. La Saile, 111. orange-?, navels-1 and valencias, Chicago. 0.*CONSUMERS' GOODS (141 articles): primes, California, New York. Beans, medium choice, New York. raisins, coast seeded, New York. Blankets, all-wool, 5 pounds to pair. Ginghams, Amoskeag, 27-inch. Boots and shoes, men's split seamless Creedmcro. Lancaster, staple, 261 -inch. men's vici calf, Blueher bal. Gluoose (corn eirup), 42 degrees mixing, New York. men's vici kid, Goodyear welt, Hosiery, men's half hose, combed yarn, 188 needle??, 17 ounces, men's gun metal, Blueher, Goodyear weit. fasi black, men's gun metai, button, Goodyear welt, women's combed peeler cotton hose, double sole, full women's gun metal, button, McKay sowed. fashioned, women's gun metal, button, Goodyear welt. women's single thread, 200 needles, combed yarn, women's patent leather pump, McKay sewed, double sole. misses', vici, patent tip, button, Illuminating oil, 110 degrees, for export, New* York, children's, gun metal, button, 150 degrees fire test, water white, jobbing lots, iittie boys', gun metai, Blucher. New York. youths', gun metal, Bluc-nor. Lard, prime contract, New York. Butter, creamery extra, Boston, Matches, No. 5, New York. creamery firsts, Boston, Meal, corn, Chicago. creamery seconds, Boston. corn, white table, Philadelphia. creamery extra, Chicago, Meat, bacon, shore clear sides, smoked loose, Chicago, creamery extra firsts, Chicago, bacon, rough sides, Chicago. . creamery firsts, Chicago. beef, carcass, good native steers, Chicago. whole milk, extras, Cincinnati, beef, fresh native sides, New York. centralized firsts, Cincinnati, beef, moss, New York. centralized seconds, Cincinnati. hams, smoked, loose, Chicago. creamery extra, St. Louis, lamb, dressed, round, Chicago. creamery fancy. New Orleans. mutton, dressed, New York. creamery choice, New Orleans. pork, mess, old to new, New York. creamery extra, Now York, poultry, dressed, iced, scalded fowls, Chicago. creamery firsts, New YorJr. poultry, fowls*, dressed, dry-picked, New York. creamery seconds, New York. veal, city dressed, good to prime, New York. creamery extra, Philadelphia, Milk, .fresh, Chicago. creamery extra firsts, Philadelphia. fresh, New York. creamery firsts, Philadelphia. fresh, San Francisco (vicinity). creamery extra, San Francisco. Molasses, Now Orleans open-kettle, New York. creamery prime firsts, San Francisco. Oleomargarine, Chicago. Canned goods, tomatoes, standard New Jersey No. 3. Peanuts, No. 1 grade, Norfolk. Carpets, Lowell, Axminster. Print cloths, 27-inch, 6-J by 60. Brussels, 5-frame Bigelow. Quinine, New York. Wilton, 5-frame Bigelow. Rice, Honduras, hard, clean, New Orleans. Cheese, whole milk, American twins, Chicago. Salt, American, medium, Chicago. State, fresh, whole milk, New York. Sheetings, bleached, 10-4, "Wamsutta. California Flats, fancy, San Francisco. brown, Indian Head, 36-inch, Coffee, Brazil grades, Ilio No. 7, New York. brown, 4-4 Ware Shoals, LL sheeting, 36-incb. Denims, Massachusetts, Mo. 220. Shirtings, bleached, 36-inch, Lonsdale. Drillings, brown, 30-inch, Massachusetts, T) standard. bleached, 4-4 Wamsutta, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1008 FEDERAL RESERVE BULLETIN. OCTOUEB 1, 1918. C. CONSUMERS' GOODS (141 articles)—Continued. C. CONSUMERS' GOODS (141 articles)—Continued. Soap, laundry, Philadelphia. Underwear, merino, shirts, and drawers, natural, 50 per cent laundry, 72 bars to pound, Cincinnati. wool. Spices, pepper, black, Singapore, New York. merino, union suits, natural, 33£ per cent wool. Starch, laundry, New York. Vegetables, fresh cabbage, Florida white, New York, Sugar, granulated, in barrels, Near York. onions, fresh, Chicago. Suitings, serge, 11-ounce. potatoes, white, fresh, good to choice, Chicago. Tableware and glassware: Vinegar, cider, Monarch. Plates, white granite, 7 inches. Whisky, Bourbon, barrels, -1 years in bond. Teas, white granite. Bourbon, bottled in bond. Nappies, 4-inch, common. Rye, Pennsylvania, barrels, 4 years in bond. Pitchers, ^-gallon, common. Rye, Pennsylvania, bottled in bond. Tumblers, table, common. Women's dress goods, French serge, all wool, 35-inch, Tea, Formosa fine, New York. storm serge, all wool, 50-inch, Tickings, Amosfceag, 32-inch. broadcloth. Tobacco, plug, 12 pieces to pound, New York. cotton-warpcashmere, 36-Inch Hamilton, Trouserings, ll-ll^-ounce worsted. poplar cloth, cotton warp, 36-inch. Under wear, cotton, men's shirts and drawers, Sicilian cloth, cotton warp, 50-inch. cotton, women's union suits. Movement of wholesale prices in the United States since January, 1914j by principal classes of commodities. (Average for 1913=-100.) Raw materials. All commodities Year and month. Farm Animal Forest Mineral Total raw Pr g o o d o u d c s e . rs' Co g n o s o u d m s e . rs1 S o ( f t B a u L ti r a s e t b a i o c u r s products. products, products. products. materials. index j number). 1914. Average for year.. 103 104 90 99 95 101 January 101 101 100 94 101 100 Febraarv... 101 102 100 95 100 99 March.;.... 102 102 100 94 99 99 April 103 103 100 94 97 May 105 102 99 94 98 June 106 101 98 93 100 July 102 106 98 92 103 August 109 109 101 99 106 102 September.. 104 110 100 100 108 103 October 100 105 96 95 102 99 November.. 98 103 95 92 103 98 December.. 99 99 94 92 102 97 1915. Average for year. 111 100 | 91 99 i 100 102 100 1 January 108 97 85 90 94 103 February... 116 95 87 98 95 104 100 March 114 96 88 98 95 101 99 April 120 95 87 99 96 102 99 May 119 99 89 101 97 102 100 June 108 102 91 99 97 100 99 July 112 104 92 101 98 101 101 August 111 104 91 100 98 100 100 September.. 102 104 92 98 99 99 98 October 105 105 92 99 101 102 101 November.. 104 101 96 99 108 105 102 December.. 109 97 100 100 115 107 105 1916. Average for year., 128 119 123 118 140 123 123. January 116 102 95 108 108 119 111 110 February... 115 106 96 111 108 123 111 111 March 110 114 97 114 110 130 112 114 April 114 115 97 115 111 137 114 116 May 116 118 98 114 113 141 115 118 June 112 122 97 114 112 142 117 118 July 115 122 96 112 113 111 119 119 August 130 123 95 112 117 140 124 123 September.. 138 125 95 117 121 142 130 127 October 151 122 96 133 128 148 135 133 November.. 164 127 98 153 139 155 143 143 December.. 153 131 99 174 143 164 142 146 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1009 Movement of wholesale prices in the United States since January, 1914, by principal classes of commodities—Continued. (Average for 1913-100.) Raw materials. All commodities Producers' Consumers1 (Bureau Year and month. Farm Animal Forest Mineral Total raw goods. goods. of Labor products. products. products. products. materials. index number). 1917. Average for year.. 210 169 118 179 173 187 172 175 January 161 136 99 175 147 166 147 150 February... 157 145 100 185 151 168 155 155 March 169 156 103 191 160 171 156 160 April 198 163 105 189 169 181 172 171 May 225 168 108 196 180 189 179 181 June 227 166 120 205 185 199 178 184 July 230 168 126 198 187 212 174 185 August 232 181 128 j 175 183 211 175 184 September.. 214 195 129 I 167 181 203 175 182 October 227 190 129 ! 150 178 185 181 180 November.. 238 187 129 I 157 182 181 183 182 December.. 233 178 129 158 178 180 185 181 1918. January... 240 174 130 171 183 181 192 185 February.. 242 176 131 172 184 184 193 187 March 249 178 135 172 187 187 189 187 April 243 193 137 170 190 190 193 191 May 226 201 138 173 189 192 194 191 June 232 198 138 171 189 194 197 193 July 237 209 140 180 196 196 202 198 August 246 215 143 180 200 199 205 Examination of the table discloses the inter- other hand the index number for the farm esting fact that, measured by the crude test of products subgroup shows particularly large range of price fluctuation, the group of articles increases mainly through the combined influclassed as consumers7 goods has shown greater ence of the price movement of cotton and stability of price than the group comprising wheat, tkougn other members of the group producers7 goods, and, with the exception of have played their part in an increasing measthe two earlier years, also the aggregate of ure, especially since the institution of price articles included "in the raw materials group. fixing for wheat in the fall of 1917. While care must be used in drawing conclusions The phenomenon of greater stability of from data covering such a limited period of price for the consumers7 goods group rioted time, it may be observed that this is in har- above is manifested also in another manner. mony with the generally accepted view that Changes from month to month are with few stability of price increases as a commodity exceptions gradual rather than abrupt, as is passes from the raw toward the finished state. the case with both producers' and consumers' It should be noted, however, that the • goods groups. Moreover, there is apparent a accepted doctrine is not borne out. if the price ! certain continuity of movement, especially in fluctuations of the producers7 goods group be | the latter part of the period, in contrast with compared with those of the ^raw materials j the relatively abrupt rises and declines shown group, as the former shows a somewhat greater j by the other groups. The direction in which range of price fluctuation. This inconsistency ' prices move changes much less frequently in apparently is due to special conditions brought the case of consumers7 goods, prices of the latter about by the war.. Thus the minerals sub- moving in somewhat the same manner as group, ordinarily exhibiting the greatest oscil- those of the forest products subgroup. The lation among the several subgroups of the raw phenomenon observed may, however, be due materials group, as a result of the price fixing to the fact that there is a much larger number activities of the Government has had its price of articles included in the consumers7 goods fluctuations during the present year confined group; hence any abrupt change in the indiwithin narrower limits than any of the other vidual item becomes much less pronounced three subgroups, even the group of forest when merged in the figures for the group. products, notably sluggish in its price move- Cotton obviously plays a much larger part ments. The effect of price fixing is also mani- in the farm products subgroup than do any fest in the producers' goods group. On the particular classes of cotton textiles in the con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1010 FEDERAL EESEEVE BULLETIN. OCTOBER l, 3918. sinners' goods group. This means that cer- The actual average monthly prices shown in tain commodities may at times dominate the the table have been abstracted from the records price movements of the particular groups, a of the United States Bureau of Labor Statistics. consider able change in the price of the com- The list of commodities which follows is modity serving in some instances to determine arranged in the same manner as the list of comthe direction of the price movement of the sub- modities included in the table giving the course group, even though "the prices of the remaining of general prices: members of the subgroup show some move- Corn, No. 3, mixed, Chicago. ment in the opposite direction. The decrease Cotton, middling, New Orleans. of seven points in the index number for the- Wheat, No. 1,-northern spring, cash, Minneapolis. mineral products subgroup between June and No. 2, red winter, Chicago. July, 1917, was of this character, being due Cattle, steers, good to choice, corn-fed, Chicago. Hides, green salted, packers', heavy native steers, Chicago. entirely to a decrease in the prices of the two Hogs, light, range common to good, Chicago. classes of semibituminous coal, even though V/ooi, Ohio, medium fleece, { and % grades, scoured. pig iron had shown a slight increase of price. Lumber, hemlock, Pennsylvania and West Virginia stock, base price. At first sight this may appear an anomalous New York. yellow pine, flooring, long-leaf, New York. situation. But further consideration merely Coal, anthracite, stove, New York tidewater. serves to confirm the reliability of the quota- bituminous, run of mine, Cincinnati (Pittsburgh, 1914-1918; tion. For a change of considerable magnitude Kanawha, 191.7-18). in the price of an important article is of more semibituminous, Poeahontas, Norfolk. Coke, Connellsville, furnace. significance than slight changes in the prices Copper, ingot, electrolytic, New York. of articles of less importance. This accords Lead, pig, desilverized, New York. fully with a system of weighting which Petroleum, crude, Pennsylvania, at wells. allots to commodities influence upon the index Pig iron, basic, f. o. b. Mahoning or Shenango Valley furt 'K Cotton yarns, white, northern, mule spun, 10/1 cones. number commensurate with their relative Leather, sole, hemlock. No. 1, middle. importance. Steel, billets, Bessemer, Pittsburgh. In order to give a more concrete illustration plates, tank, \ inch thick. 6 to 100 inches wide, f. o.b. Pittsburgh, rails, open hearth, standard, Pittsburgh, of actual price movements, there are also pre- Worsted yarns 2-32's crossbred stock. sented in* the accompanying tables monthly Beef, carcass, good native steers, Chicago. actual and relative figures since January, 1914, Coffee. Brazil grades, Rio No. 7, New York. Flour, wheat, Minneapolis, standard patents, 1914-1917; standard war, for certain commodities of a basic character. 1918. Index numbers have been calculated again on Hams, smoked, loose, Chicago. the basis of average prices prevailing in 1913. Illuminating oil. 150° fire test, water-white, jobbing lots, New York, Sugar, granulated, in barrels. New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER, 1,1918. .FEDERAL RESERVE BULLETIN". 1011 Average wholesale prices of commodities for each month since January, 191.4. (Average for 1913=100.) Co C r h n i , c N ag o o . . 3, Co N tt e o w n , O m rl i e d a d n li s n . g ' , "W n h o e r a th t, e rn N sp o r . i ng 1 , , W w h i e n a te t, r , N C o h . i c 2 a , g r o e . d C to a t c t h le o , i c s e te , e C rs h , i c g a o g o o d . . Hi h d e e a s v , y, pa . c n k a e t r i s v " e , Minneapolis. steers, Chicago. Year and month. Average p A b r v i u c e s e r h a e p g l e . e r R p e r l i a c t e iv . e p " A r p v i o c e u e r n a r> d g e . e r R p e r l i a c t e iv . e p ' A b r u v ic s e e h r a p e g l e . e r R p e r l i a c t e iv . e p A b r v i u c e s e r h a p e g e l. e r R p e r la ic t e iv . e p p r o ic u e n d p s e . r R p e r l i a c t e iv . e A p ' r p v i o c e e u r a n p g d e e . r R p e r l i a c t e iv . e 1914. Average for year $0.6826 Ill SO.1126 89 §1.0031 115 51.0051 102 $9.0387 106 -SO. 1963 107 January... . 5913 96 . 1296 102 . 8750 100 . 9690 98 8.7563 103 .3800 98 Fehruarv . 5988 97 . 1291 102 . S229 306 . 9602 97 8.6375 302 . 1825 March . 6245 101 .1295 J02 . 9209 106 . 9495 96 8.6550 102 .1813 99 Aoril . 6580 107 . 1314 103 . 9119 104 .9386 95 8.7125 102 . 1800 93 May . 6916 112 . 1335 105 • .9384 107 .9763 99 8. 7250 103 . 1825 99 June .7038 114 . 1378 ]09 . 9125 104 . 8918 90 8.7950 103 .1850 101 July . 7044 114 . 1331 105 . 8971 103 . 8210 83 9.2188 108 . 1938 105 August . 8035 131 1.0632 122 . 9563 97 9.5200 . 2050 111 September .7748 126 . 0838 66 1.1364 130 1.1069 112 9.7333 114 .2100 114 October . 7266 118 . 0692 54 1.1020 126 1.1086 112 9.4313 ill .2125 IIP November . 6806 111 .0742 58 I.1594 133 1.1486 116 9.4063 111 .2175 118 "December . .6340 103 . 0721 57 1.1921 136 1.2023 122 8.9125 105 . 2250 122 1915. Average for year... .7217 117 .0961 70 1.3061 150 1.3067 132 8.7015 102 .2420 132 . 7056 115 . 0783 62 1.3527 155 1.3910 141 8.5333 100 . 2300 125 "Februarv .7460 121 . 0804 63 1.5135 173 1.6091 163 8.1750 96 .2350 March . 7133 116 .0836 66 1.4724 169 1.5311 155 8.2333 97 . 2300 125 April . 7438 121 . 0'M7 75 1.5407 176 2.5936 161 8.0313 94 . 3 875 102 Hay . 7647 124 .0906 71 1.5767 181 1.5700 159 8.5900 101 . 2075 113 June... . .7355 119 . 0911 72 1.2869 147 1.2265 124 8.9563 105 . 2325 123 July .7806 127 . 0869 68 1.3901 159 1.1611 118 9.2125 108 . 2575 14C August . 7828 127 .0895 70 1.3730 157 1.0963 111 9.2300 108 .2738 149 September . 7269 118 . 1053 83 .9811 112 1.0760 109 8.9500 105 . 2650 1*4 October .6335 103 .1203 95 1.0190 117 1.1325 115 8.8750 104 .2650 144 November 6495 106 .1155 91 1.0182 117 1.1250 114 8.8450 104 . 2625 143 December . 6794 no .1185 93 1.1311 129 1.2322 125 8.4875 100 .2575 140 1916. Average for year... .8118 132 . 1410 111 1.4108 162 1.3505 137 9.5730 113 . 2618 142 January. .7356 120 .1205 95 1.2894 148 3.2896 131 8.6650 102 .2300 12c Fobru ary . 7385 120 .1142 90 1.2825 147 1.2585 128 8.4688 100 . 2375 129 Ma^ch . 7150 116 .1177 93 1.1409 131 1.1328 115 8.9688 105 . 2275 124 April . 7525 122 . 1188 94 1.2169 139 1.2153 123 9.1188 107 .2225 121 May .7293 118 . 3.257 99 1.2146 139 1.1554 117 9.4600 111 . 2475 135 June . 7341 119 .1280 101 1.1113 128 1.0413 106 10.2-625 321 . 2675 145 July .8041 131 . 1303 103 1.1703 134 1.1597 118 9.9850 117 . 2700 147 August .8505 138 . 1417 112 1.4854 170 1.4706 149 9.8500 116 . 2625 14S September .8522 138 . 1532 121 1.6080 184 1.5344 156 9.8000 115 . 2600 141 October .9463 154 .1723 136 1.7569 201 1.6809 170 9.9050 116 . 2663 145 November. . . . 9663 157 . I960 154 1.9800 221 1.8116 184 10.3500 122 .3150 Decent be? .9125 148 . 1757 138 1. 7011 202 1. 7275 175 10.2917 121 . 3350 182 1917. Average for year... 1.G200 263 .2259 178 - 2.3248 266 2.2779 231 12.8085 151 . 3273 178 Janu&rv .9753 158 . 1735 137 1.9136 219 1.9024 193 10.5300 124 .3350 182 February 1.0053 163 . 1708 334 1.8080 207 1.7969 182 11.1313 133 .3175 173- March 1.1181 182 . 1764 139 1.9844 227 1.9781 201 11.8688 140 . 3050 Aoril 1.3906 226 .1950 154 2.3814 273 2.4672 250 12.3100 145 .3050 166 May 1.6180 263 . 1999 157 2.9806 341 2.9705 301 12.4750 147 . 33 50 171 June 1.7119 278 . 2421 191 2.6935 308 2.6388 288 12.5560 148 . 3300 179 July 2.0393 331 . 2525 199 2.5815 296 2.3310 236 12.5600 148 .3300 179 Augi i st ... 1.9181 312 .2513 198 2.7875 319 2.2563 229 13.3750 155 . 3200 174 September 2.0613 335 .2160 170 2.2213 254 2.3775 221 14.9875 176 . 3300 176 October l.9620 319 . 2659 209 2.1700 248 2.1700 220 34.0750 173 . 3375 ISA November 2.1238 329 . 2804 221 2.1700 248 2.1700 220 14.3875 169 . 3525 192 December 1.5875 258 . 2894 228 2.1700 248 2.1700 220 13.2350 156 .3500 190 1918. January 1.6S50 274 .3105 244 2.1700 248 2.1700 220 13.1125 154 .3280 178 February 1.6375 266 .3097 244 2.1700 248 2.1700 220 13.0750 154 . 2925 159 March 1.5563 253 . 3291 259 2.1700 248 2.1700 220 13.2313 156 . 262? 143 April 1.5850 258 .3350 26 i 2.1700 248 2.1700 220 15.1750 178 .2719 148 Mav 3.5250 248 .2894 228 2.1700 248 2.1700 220 16.4167 193 . 3110 169 June 1.5125 246 .3066 241 2.1700 248 2.1700 220 17.1750 202 . 3300 175 July 1.5900 258 .2945 232 2.1700 248 2.2470 228 17.6250 207 . 3240 376 August 1.6225 264 . 3038 239 2.2231 255 2.2325 226 17.8250 210 .3000 163 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1012 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Average wholesale prices of commodities for each month since January, 1914—Continued. (Average for 1913=100.) Coal, anthracite, Coal, bituminous, H C og h s i , c a l g ig o h . t, g W ra o d o e l s , , O s h co io u , r e H d. N H e e w m Y lo o c r k k , . i m rif g r ,N -N e T w Pw * Y o n r r k ir . ; i ; sto t v id e e . N w e a w te r Y . ork i r C u i n n c o i f n m na i t n i. e, Year and month. | | p A ri v c e e r a p g e e r R ti e v la e - p A r v ic e e r a p g e e r R ti e v l e a- p A r v ic e e r a p g e e r R ti e v l e a- p A r v ic e e r a p g e e r R ti e v l e a- p A r v ic e e r a p g e e r R ti e v l e a- p A r v ic e e r a p g e e r R ti e v l e a- 100 price. pound. price. M feet. price. M feet. price. long ton. price. short ton. price. pounds. 1914. i Average for year... 88.3816 99 ! SO.4398 93 ! §24.3958 101 $42.7500 96 85.0607 100 1 $2.2000 100 January.. 8.3031 .4167 24.5000 j 101 44.0000 6.2000 103 2.2000 100 February„ 8.6156 102 .4028 86 24.5000 101 44.0000 5.2000 103 2.2000 100 March i 8.6600 102 .4028 86 24.5000 101 44.0000 5.1938 103 2.2000 100 April. 8.7313 103 .4167 88 24.5000 101 44.0000 4.6974 93 2.2000 100 May 8.3875 99 .4306 91 24.5000 101 43.0000 4.7715 94 2.2000 100 June 8.1975 97 .4300 91 24.5000 101 43.0000 4.8673 96 2.2000 100 July 8.7563 104 .4444 94 24.5000 101 42.0000 4.9726 98 2.2000 100 August 9.1500 108 .4583 97 24.2500 100 42.0000 5.0805 100 2.2000 100 September.. 9.0188 107 .4583 97 24.2500 100 42.0000 5.1794 102 2.2000 100 October 7.9313 94 .4583 97 24.2500 100 42.0000 5.1947 103 2.2000 100 November.. 7.4813 88 .4722 100 24.2500 100 42.0000 5.1912 103 2.2000 100 December.. 7.1313 84 .4861 103 24.2500 100 41.0000 5.1796 102 2.2000 100 1915. Average for year j 7.1870 85 .5714 121 21.5909 89 i 39.5909 5.0440 100 2.2000 100 January I 6.9875 .5143 109 24.2500 100 41.0000 5.1767 102 2.2000 100 February \ Q. 7281 .5429 115 24.2500 100 41.0000 92 5.1866 102 2.2000 100 March ' 6". "75"0"0 .5571 118 21.5000 41.0000 92 5.1816 102 2.2000 100 April 7.2813 .5571 118 21.5000 41.0000 92 4.6904 93 2.2000 100 May 7.6000 .5714 121 21.5000 40.0000 90 4.7506 94 2.2000 100 June 7.5781 .5571 118 20.5000 85 40.0000 90 4.8300 . 95 2.2000 100 July 7.5750 .5571 118 38.5000 86 j 4.9571 ! 98 2.2000 100 August 7.2650 .5714 I 121 20.5000 38.5000 86 | 5.0796 100 2.2000 100 September 7.7000 .5714 I 121 20.5000 38.5000 86 i 5.1529 102 2.2000 100 October 8.0125 .6000! 127 i20.5000 38.0000 85 : 5.1826 102 2.2000 100 November 6.6450 . . 6143 130 21.2500 38.0000 85 !i 5.1766 102 2.2000 100 December 6.2438 .6429 136 21.2500 38.0000 85 ;: 5.1710 102 2.2000 100 i 1916. Average for year... 9.4000 111 .6798 144 | 23.5417 97 39.3750 5.4540 108 2.6750 122 January I 7.1400 84 .6429 136 I 22.2500 92 39.5000 5.2639 104 2.2000 100 February j 8.1375 96 .6571 140 | 22.2500 92 40.0000 90 5.2588 104 2.2000 100 March ! 9.4688 112 .6714 143 ' 23.2500 95 40.0000 90 5.2742 104 2.2000 100 April ! 9.5438 113 . 6857 146 i 24.0000 99 40.0000 90 , 5.2876 104 2.2000 100 May j 9.7050 115 .6714 143 i 23.7500 98 ! 40.0000 90 !i 5.2740 104 2.2000 100 June | 9.3813 in .6714 143 i 23.7500 98 39.0000 87 I 5.3713 106 2.2000 100 July ! 9.7650 116 .6857 146 ;j 23.7500 98 38.0000 85 ! 5.4495 108 2.2000 100 August j 10.4063 123 . 6857 140 ij 23.7500 3S.O00O 85 j 5.5570 110 2.2000 100 September ! 10.7750 127 ! . 6857 146 ij 23.7500 38.0000 85 | 5.6625 112 2.5000 114 October | 9.6550 114 .6857 146 j1 23.7500 39.0000 87 !! 5.6744 112 3.7500 170 November I 9.4063 111 .6857 146 ! 23.7500 98 40.0000 90 il 5. (5946 113 3.7500 170 December 9.7500 115 .7286 155! 24.5000 101 41.0000 92 i 5.6801 112 4.5000 205 1917. Average for year j 15.4594 183 1.1452 | 243 27.7083 114 50.9091 114 ! 5.8724 4.5833 208 January I 10.6050 125 .8143 ! 173 24.5000 101 41.5000 5.6899 112 4.5000 205 February ! "1.2063 144 .8286 I 176 I 25.5000 105 41.5000 93 5.6826 112 5.0000 227 March L3688 170 .9286 ! 197 25.5000 105 42.0000 94 5.6744 112 5.0000 227 April •.2750 181 1.0000 i 212 25.5000 105 43.0000 96 5.1916 103 5.0000 227 May i. 5000 183 1.0714 | 227 26.0000 107 5.6826 112 6.0000 273 June i.2125 180 1.1000 ! 234 ! 26.0000 107 50.0000 112 5.7884 114 6.0000 273 July i.3750 ! 182 1.2143 258 28.0000 116 57.0000 128 5.8859 116 5.0000 227 A Se u p g t u e s m t ber 18.4250 2 2 0 1 5 8 1 1 . . 3 3 4 7 2 1 9 4 I 2 2 8 9 5 1 :. I 2 3 9 0 . . 5 5 0 0 0 0 0 0 1 1 2 2 2 6 5 5 7 7 . . 0 0 0 0 0 0 0 0 1 1 2 2 8 8 5 6 . . 9 1 7 3 9 0 7 3 1 12 1 1 8 4 3 . . 4 3 0 0 0 0 0 0 2 1 0 5 0 0 October 17.5550 208 1.3571 288 30.5000 126 57.0000 128 0.1426 121 3.3000 150 November | 17.3500 205 1.3571 288 30.5000 126 57.0000 128 6.1469 121 3.7500 170 December ! 16.7150 198 1.3571 288 j 30.5000 126 57.0000 128 6.4736 128 3.7500 170 1918. | January 16.2125 192 1.4545 309 30.5000 126 57.0000 128 6.5000 128 3.6000 164 February 16.6938 197 1.4545 309 30.5000 126 57.0000 128 6.5000 128 3.6000 164 March 17.4250 206 1.4515 309 30.5000 126 60.0000 135 6.4642 128 3.6000 164 A pril 17.5100 207 1.4545 309 ! 33.5000 138 60.0000 135 6.2606 124 3.6000 164 May 17.5000 207 1.4182 301 33.5000 138 60.0000 135 6.3000 124 3.8500 175 June 15.5250 184 1.4182 301 34.5000 142 60.0000 .135 6.3212 125 3.7500 170 July 18.0000 213 1.4365 305 j 34.5000 142 60.0000 135 6.5968 130 4.1000 186 August 19.7750 234 1.4365 305 ! 63.0000 141 6.5992 130 4.1000 186 I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL. RESERVE BULLEHH". 1013 Average wholesale prices of commodities for each month since January, 1914—Continued. (Average for 1913=100.) Coal, N P o o rf c o a l h k o . ntas, Coke, v C ill o e n . neils- el C ec o t p r p o Y e lv o r, i r i k i c n . . ' g N o e t, w L v e e a r d i , Y z e p o i d * r , ? k , N . d e e w sil- P P e c t n ro n l s e w y u e b m l l a , s n . c ia ru , d a! e : , Pig iron, basic. Year and month. Average Rela- Average Rela- Average Rela- Average Rela- Average Rela- Average Relaprice per tive price per tive price per tive price per tive price per tive price per tive ong ton. price. short ton. price. pound. price. pound. price. barrel. price. long ton. price. 1914. Average for year $3.0000 100 &.80S3 74 30.1338 85 SO.3890 88 $1.9167 78 $12.8733 88 Januarv 3.0000 100 j.9250 79 .1488 95 .0415 94 2.5000 102 12.5000 85 February. 3.0000 100 1.9250 79 .1475 94 .0415 94 2.5000 102 13.1900 90 March 3.0000 100 1.8750 77 .1438 91 . 0400 91 2.5000 102 13.0000 88 April. 3.0000 100 1.92;"0 79 . 1438 91 .03*0 86 2.5000 102 13.0000 88 May. .. 3.0000 •100 1.9250 79 . 1420 90 .0390 89 2.0100 82 13.0000 88 June 3.0000 100 1.8750 77 .1400 89 . 0390 89 1.8000 73 13.0000 88 Julv 3. 0000 100 1.8750 77 . 1340 85 .0390 89 1.7500 71 13.0000 88 August 3-0000 100 7-* .1250 70 . 0390 89 1.6500 67 13 0000 88 September 3.0000 100 1.7250 71 .1238 79 .0388 88 3.4500 59 13.0000 88 October 3-0000 100 3.6750 66 .1170 74 .0375 85 1.-1500 59 12.8100 87 November 3.0000 100 1.5500 ' 84 .. 1125 72 . 0350 80 1.4500 59 12.4800 85 3.0000 100 1.6250 37 .. 1275 SI .0380 86 1.4500 59 12.5000 85 1915. 2.8500 95 1.7854 73 ,1726 110 .0459 104 1.5292 62 13.7408 January.. 2.8500 95 1.6250 67 . 1300 83 .0380 86 1.4500 59 12.5000 85 February. 2.8500 95 1.5750 85 . 1475 94 , 031J0 86 1.5000 61 12.5000 85 March...". 2.8500 95 1-5750 65 . 1103 93 . 0390 S9 1.5000 61 12 5000 85 A-pril. 2.8500 95 1.6250 67 . 1588 101 .0420 95 1.4000 57 12.5000 85 May . 2.8500 95 l.«250 . 67 .1863 118 . 0420 95 1.3500 55 12.5000 85 June 2.8500 95 1.6250 67 119 . 0490 111 1.3500 55 32.5900 86 2 8500 I.7500 72 * 1(5? 126 .0575 131 1.3500 55 12.7400 87 August 2.8500 95 1.6750 69 116 .. 0500 114 1.3500 55 14 0600 96 Septerv-bCMr 2.8500 95 1.6750 69 .1775 113 . 0490 111 1.6000 65 14.7500 100 October.. 2.8500 95 2.0000 82 . 1800 114 • 0450 102 1.7000 G9 15 0000 102 November 2.8500 95 2.3750 S7 . 1788 114 .0-190 111 1.8000 73 15.7500 107 December..... 2.8500 95 2.3000 9-1 .1975 426 .0525 119 2.0000 17.5000 119 1916. Average for year 3.7292 124 3.2458 133 ..2754 175 .0680 155 2.4883 101 19.7600 134 Januarv.. 3.0000 100 2.8750 11? .2288 145 .0550 125 2.2500 92 17.8100 121 February 3.0000 100 2.6250 108 -.2538 161 ,0610 139 2.3500 96 17.6900 120 March 3.0000 100 3.000(1 123 . 2700 172 . 0640 145 2.4000 98 18.2000 124 \pril 3.0000 100 2.8250 116 .2688 171 182 2.6000 106 18.1300 123 May.... . 3.0000 100 2.3750 97 . 2«50 181 . 0750 170 2.6000 106 18.0000 122 June 3.0000 100 2.6250 108 .2S00 178 .0725 165 2.6000 10fi 18.0000 122 July . . . 3.0000 300 2,6250 10S . 2650 168 .0685 156 2- 6000 106 18.0000 .122 August 3.2500 108 2.6250 108 i .2600 165 . 0610 139 2.5000 102 18.0000 122 September...* 4.0000 133 2.7500 113 ! .2775 176 . 0650 148 2.3000 94 18.3100 125 October 4.5000 150 3.1250 128 i .2850 181 .0705 360 2-4000 08 19.8800 135 November.. 8.0000 200 5.7500 236 ! .2863 182 .0700 159 2.6000 100 25.1000 171 December.... 6.0000 200 5.7500 236 | .3450 219 .0730 166 2.6000 106 30.0000 204 3917. Average tor vear 5.4320 181 3.2500 338 1 .2940 187 .0912 207 3.2000 131 38.9038 265 Januarv.. 6.0000 200 7.2500 297 i .2950 188 .0750 170 2.8500 116 30.0000 204 February ... .. 6.5000 217 7.5000 307 i .3300 210 . 0850 1S3 3.0500 124 30.0000 204 March -. 6.5000 217 8.5000 3-JS1 .3625 230 .0950 216 3.0500 124 32.2500 219 April 6.5000 217 7.2500 297 ! .34.00 216 .0935 213 3.0500 124 3S.7500 264 Mav . . . .. 7.0000 233 7.00C0 2S7 i .3100 197 . 0988 225 3.1000 127 41.6000 283 June ... 7.0000 233 9.5000 389 . 3250 207 1.1500 261 3.1000 127 48.7509 oon July 5.1400 171 12.2500 502 .3175 202 1.18*0 259 3.1000 127 52.5000 357 Angus*. . .. 3.9080 130 10.0000 410 . 2900 18* 1.0880 247 3.1000 127 51.2000 348 Scptem ber 3.9080 130 13.7500 482 .2525 161 1.03*0 236 3.5000 143 42.7500 291 October 3.9080 130 6.0000 246 . 2350 149 . 0795 381 3.5000 143 33.0000 j 224 No vein ber.. 4.--1120 147 *>. 0000 216 . 2350 14:9 .0513 139 3.5000 143 33.0000 224 December 4.4120 147 6.0000 246 .2350 149 .0650 1-4,8 3. 5000 143 33.0000 224 1918. Januarv 4.4120 147 6.0000 246 .2350 149 . 06*4, 155 3.7500 153 33.0000 224 February 4.4120 147 6.0000 216 .2350 149 .0706 160 3-9375 361 33.0000 224 4.4120 147 6.0000 246 . 2350 149 .0721 4.0000 163 33.0000 224 April 4.2440 141 6.0000 246 . 2350 149 . 0698 159 4.0000 163 32.0000 218 May 4.2190 141 6.0000 246 .2350 149 .0691 157 4.0000 163 32.0000 218 June 4.2320 141 6.0000 246 .2350 149 .0728 165 4.0000 163 32.0000 218 Julv 4.6320 154 6.0000 246 .2550 162 .0802 182 4.0000 163 32.0000 218 Auihisi. 4.6320 154 6-0000 246 . 2600 165 .080S 183 4.0000 163 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1014 FEDERAL RESERVE BULLETIN. OCTOBER 1. 1018. Average wholesale prices of commodities for each month since January, 1914—Continued. (Average for 1913=100.) n C or o t t h to e 1 n r 0 n / 1 y c . a o r n n e s s , , h L em ea lo th c e k r , , N so o le . , 1. Stee P l i , t p ts la b t u e r s g , h ta . nk, Ste P a i l h t , t e s r a a b r i u l t s h r , g , o h p . en 2 W -3 o 2 r 's s , t e c d ro y ss a b rn re s d , . Year and month. Average j Rel- Average Eel- i Average Rel- Average Rel- Average Rel- Average Relprice per I ative price per ative ! price per ative price per ative price per ative price per ative pound. ! price. pound. price, j long ton. price. pound. Price. long ton. price. pound. price. i ! 1914. Average for year. SO. 1967 $0.3019 107 §20.0775 SO. 0116 $30.0000 100 $0.6400 January .2200 .3000 106 20.1300 .0120 30.0000 100 .6400 82 February.. . 2150 .3000 106 21.0000 | .0123 30.0000 100 .6400 82 March .2150 .3000 106 21.0000 .0123 30.0000 100 .6400 82 April .2200 .3050 108 20.8000 .0118 30.0000 100 I .6400 82 May .2100 .3050 108 20. 0000 .0115 30.0000 100 .6400 82 June .2100 . 3050 108 19.5000 .0113 30.0000 100 .6400 82 July . 2150 .3050 108 19.0000 .0113 30.0000 100 .6500 84 August .2000 .2950 105 20.2500 .0113 30.0000 100 .6500 84 September. .1700 21.0000 .0120 30.0000 100 .6600 85 October .1700 20.0000 .0115 30.0000 100 .6300 81 November., . 1550 19.2500 .0110 30.0000 100 .6300 81 December.. .1600 19.0000 .0105 30.0000 100 .6200 1915, Average for year. .1727 .3094 110 22.4408 87 .0127 30.0000 100 .7875 101 January .1650 19.2500 75 .0110 30.0000 100 .6200 80 February... . 1650 19.5000 76 .0110 30.0000 100 .6200 80 March .1450 19.7000 76 .0113 30.0000 100 .6200 80 April . 1650 .3050 108 20.0000 78 .0113 30.0000 100 .8200 106 May . 1650 . 2950 105 20.0000 78 .0115 30.0000 100 .8^00 106 June .1600 .2950 105 20.5000 79 .0115 30.0000 100 .8^00 106 July .1600 .3050 108 21.3800 .83 .0120 30.0000 100 .8500 119 August . 1675 .3100 110 23.1300 90 .0125 30.0000 100 .8500 119 September. .1700 .3100 110 24.1000 .0135 30.0000 100 .8500 119 October .1950 .3200 113 24.6300 .0140 30.0000 100 .8500 119 November.. .2050 .3200 113 26.5000 103 .0150 i 30.0000 100 . 8500 119 December.. .2100 95 .3250 115 30.6000 119 30.0000 100 .8800 115 1916. Average for year .2646 120 .3883 138 43.9458 170 0324 219 33.333 111 1.0500 135 January .2100 95 .3250 115 32.0000 124 0208 • 141 30.0000 100 .8800 115 February.. . 2250 102 .3250 115 33.5000 130 0225 152 30.0000 100 .8800 115 March .2200 99 .3350 I 119 42.4000 164 0255 172 30.0000 100 .9200 118 April . 2250 102 .3600 128 45.0000 174 0325 220 30.0000 100 .9500 122 May .2425 110 .3700 SI 45.0000 174 0338 228 30.0000 100 1.0000 129 June .2500 113 .3700 43.5000 169 0345 233 35.0000 117 1.1000 142 July .2525 114 .3700 41.0000 159 0345 233 35.0000 117 1.1000 142 A S N O D e u c o e p g t v c o t u e e e b s m m m e t r b b b e e e r r r . . . . . . . . . 3 3 3 2 2 3 0 8 7 5 2 0 5 7 5 5 0 0 5 0 1 1 1 1 1 2 3 1 7 5 4 6 6 4 0 . . . . . 3 3 4 5 4 7 7 9 7 0 0 0 0 0 5 0 0 0 0 0 1 1 1 1 1 3 3 3 4 7 1 1 1 4 4 4 4 5 5 4 5 7 4 2 6 . . . . . 0 5 2 0 2 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 1 1 1 2 2 7 7 2 7 0 1 4 3 9 2 0 0 0 0 0 3 3 3 4 3 4 7 2 5 5 5 5 5 0 0 2 2 2 2 2 3 3 3 5 8 3 6 6 3 7 3 3 3 3 4 5 5 5 5 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 3 1 7 7 7 3 7 1 1 1 1 1 . . . . . 1 2 1 2 2 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 5 4 4 5 5 4 2 8 4 4 202 1917. Average for year. .3971 179 .5354 190 69.8558 271 .0557 375 40.0000 133 1.5558 200 January .3400 154 .5700 203 63.0000 244 .0430 291 40.0000 133 1.2500 161 February.. . 3200 149 .5800 206 65.0000 252 .0438 296 40.0000 133 1.2500 161 March .3100 140 5950 211 66.2500 257 .0438 i 296 40.0000 133 1.2700 164 April .3000 163 .5700 202 73.7500 286 .05% i 355 40.0000 133 1.3000 167 May .3650 165 .5700 202 86.0000 333 .0575 ! 389 40.0000 133 1.4000 180 June . 3750 169 .5800 206 98. 7500 383 .0700 i 473 40.0000 133 1.5500 200 July .4500 203 .5400 191 100.0000 388 .0900 ; 608 40.0000 133 1.6000 206 August .4400 199 .5000 177 86.0000 333 .0900 608 40.0000 133 1.6500 212 September. .4200 190 .4800 170 66.2500 257 .0800 541 40.0000 133 1.7000 219 October .4200 190 .4600 163 49.3750 191 .0325 220 40.0000 133 1.8000 232 No'/ember . . 4700 212 .4800 170 47.5000 184 .0325 220 40.0000 133 1.9000 245 December.. .4950 224 .5000 177 47.5000 184 .0325 220 40.0000 133 2.0000 257 1918. January... .5363 242 .4900 174 47.5000 184 .0325 220 46.8000 156 2.0000 257 February. . 5536 250 .4900 174 47.5000 184 .0325 220 57.0000 1*90 2.0071 258 March . 5745 260 . 4550 161 47.5000 184 .0325 220 57.0000 190 2.1000 270 April .6162 278 .4550 161 47.5000 184 .0325 220 57.0000 190 2.1500 277 May .6332 286 .4900 174 47.5000 184 .0325 220 57.0000 190 2.1500 277 June .6437 291 .4900 174 47.5000 184 .0325 220 57.0000 190 2.1500 277 July .6412 290 .4900 174 47.5000 184 .0325 220 57.0000 190 2.1500 277 August 47.5000 184 .0325 220 57.0000 190 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1015 Average wholesale prices of commodities for each mo?ith since January, 1914—Continued. (Average for 1913=-100.) Flour, wheat, st B g e e o e e o rs f d , , c C a n r h a c i t a c i s a v s g e , o. Coffee, Bio No. 7. s 1 t 9 a a 1 n r 4 d d - 1 a w 9 rd 1 a 7 r, p , 1 s a 9 t t a 1 e n 8 n d , ts - Ham C s h , i c s a m g o o k . ed, Ill 1 u N 5 m 0 e ° w i n f i a r Y e ti o n t r e g k s . o t, il, S N ug e a l w a r , t e Y g d o r , a r n k u . - Minneapolis. Year and month. Average ! Rcla- Average Rela- Average Rela- Average Rela- Average j Rela- Average Relapricc per I tiye price per tive price per tive price per tive price per tye price per tive pound. : price. pound. price. barrel. price. "pound. price. gallon, price. pound. price. 1914. Average for year., $0.1364 105 SO. 0816 73 S5.0962 $0.1670 100 $0.1200 I SO. 0471 110 January .1300 100 .0913 4.5000 . 1531 92 .1200 I .0392 92 February... . 1300 100 .0950 4.5875 100 .1525 92 .1200 j .0392 92 March .1300 100 .0925 4.6250 101 .1555 94 .1200 ! .0382 89 April .1316 102 .0894 4.5500 99 .1575 : 95 .1200 i .0372 87 May . 1325 102 .0875 4.6.125 101 .1588 | 96 . 1200 . 0397 93 June .1325 102 .0913 4.4900 98 .1655 \ 100 .1200 . 0417 98 July .1350 104 . 0882 4.5938 100 .1769 I 106 .1200 .0420 98 August .1419 110 . 0750 5.5125 120 .1903 | 115 .1200 .0649 152 September. .1,438 I 111 .0763 5.9400 130 .1905 i 115 .1200 .0680 159 October .1438 ' 111 .0656 5.7563 126 .1719 i 103 . 1200 .0593 139 November.. . 1438 111 .0638 5.8813 128 .1663 ! 100 . 1200 .0493 115 December.. .1428 110 .0631 5.9500 130 .1633 ! . 1200 . 04S3 113 1915. Average for year... .1289 100 .0745 6.6630 145 .1531 | .1208 I .0556 130 January .1300 100 .0725 6.8563 150 .1538 | .1200 ! 97 1 .0488 114 February .1213 94 . 0825 7.7068 168 .1525 ! .1200 I 97 .0554 130 March .1175 91 .0775 7.4S50 163 .1425 I .1200 I 97 .0571 134 April .1175 91 .0806 7.7063 168 .1438 i .1200 97 . 0578 135 May .1213 94 .0775 7.8813 172 .1513 | . 1200 97 . 0588 138 June .1253 97 . 0700 6.5950 144 .15^5 ! .1200 97 .0558 i 138 July . 1315 102 .0738 7.0313 153 .1610 ! .1200 97 .0582 136 August .1325 102 .0738 6.3100 138 .1495 i . 1200 97 .0549 ! 129 September .1350 104 .0675 5.3313 116 .1447 i .1200 97 .0506 ! 119 October .1375 106 . 0675 5.5188 120 .1613 i .1200 97 .0197 116 November .1375 106 .0750 5.5000 120 .1625 ! .1200 97 . 0568 133 December .1375 106 .0763 6.2250 136 .1556 j . 1300 105 I .0592 139 1916. i ! Average for year... .1382] 107 .0924 7.2839 158 .1850 i 111 .1217 99 .0688 161 J A J S M A J N M D F O u u a e e p u o c e a a n n l p b t y r g c v y r e u o t i c r e u e l e a b u h m s m m r e t a y r b b r b y e e e r r . r . . . . . . . . . . . . . . . . . . . 1 1 1 1 1 1 1 1 1 1 1 1 4 3 3 3 3 3 3 4 3 3 3 3 1 7 7 7 7 7 7 1 7 7 7 7 3 5 5 5 5 5 5 5 5 5 5 5 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 6 9 6 9 6 6 6 6 6 6 6 6 . . . . . . . . . . . . 0 0 0 0 0 0 0 0 0 0 0 0 9 9 7 9 9 9 9 9 8 9 9 9 7 6 8 2 0 5 5 2 8 5 2 5 5 3 8 5 0 0 0 5 8 0 5 0 6 6 7 9 5 6 5 9 6 6 8 8 . . . . . . . . . . . . 1 8 7 1 6 6 2 2 8 8 4 4 8 8 6 9 0 0 8 1 2 4 2 4 1 1 2 0 8 5 0 3 0 5 5 0 3 3 5 0 0 8 0 8 0 0 0 0 2 1 1 1 1 1 1 1 2 1 1 3 3 2 6 3 0 4 1 2 8 4 3 5 6 6 6 2 5 4 8 4 0 . . . . . . . . . . . 1 1 1 1 1 1 2 1 1 1 1 8 8 7 0 6 9 9 8 9 5 9 3 4 6 3 7 3 8 5 0 0 0 0 1 5 9 1 5 5 8 0 0 0 ! • i ! ; i ! ! I ! 1 1 1 1 1 1 1 1 1 1 1 1 9 1 1 0 0 1 1 1 1 2 2 1 6 1 4 6 1 4 0 4 6 2 0 . . . . . . . . . . . . 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 . 2 2 2 2 3 2 2 0 0 0 0 3 0 0 0 0 0 0 C 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 9 9 9 9 9 9 9 9 9 9 0 0 7 7 7 7 7 7 7 7 7 7 5 5 0 0 0 0 0 0 0 0 0 0 0 0 7 6 7 7 7 7 6 5 7 5 7 6 3 4 3 0 5 5 0 7 3 9 0 9 6 8 7 6 9 0 0 3 5 7 8 2 1 1 1 1 1 1 1 1 1 1 1 2 6 7 7 6 7 5 6 3 7 4 6 4 5 5 2 4 6 4 6 4 2 9 2 0 1917. Average for year... . 1672 129 .0927 11.3909 249 .2520 j .1212 i 101 . 0771 181 January .1375 106 .0975 9.2105 201 .1915 ' 117 .1200 97 0662 155 February. - - .1413 109 .1000 9.0688 198 . 2113 127 . 1200 97 0086 161 March . 1490 115 . 0975 9.6313 210 .2288 138 . 1200 97 0706 165 April . 1600 124 .0950 11.6188 253 . 2450 147 . 1200 97 0815 191 May .1600 124 .1013 14.8800 325 .2655 160 .1200 97 0794 186 June .1615 125 .1038 13.8938 303 . 2594 156 .1200 97 0754 177 July . 1638 120 . 0950 12.7500 278 .2395 144 .1200 97 0745 174 August .1713 132 .0913 13.0688 285 . 2413 145 .1200 97 0818 192 September. .1900 147 . 0913 11.2625 246 . 2075 161 . 1300 105 0823 193 October . 1900 147 . 0850 10.5000 229 .2860 i 172 .1300 105 0818 192 November.. .1900 147 . 0794 10.2250 223 .2900 I 174 . 1300 105 0818 192 December.. .1870 144 .0756 10.1313 221 .3010 i 181 . 1400 114 0804 188 1918. January.., . 1750 135 . 0853 10.0850 220 .2950 I 177 .1600 130 .0744 174 February. . 1750 135 .0833 10.3000 225 .2984 I 180 . 1600 130 . 0730 171 March . 1750 135 .0891 10.0938 220 .3028 182 . 1600 130 .0730 171 April . 2050 158 . 0903 9.9850 218 .3075 185 . 1675 136 . 0730 171 May .2250 174 .0873 9.5250 208 .3025 182 . 1700 138 .0730 171 June .2338 181 .0841 9.8250 214 . 2994 180 .1700 138 .0731 171 July .2400 185 . 0855 10.7020 233 .3025 1S2 . 1.710 139 .0735 172 August... . 2420 187 .0853 10.2100 223 .3225 194 . 1750 142 . 0735 172 I Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1016 FEDEKAL RESERVE BULLETIN. OCTOBEK I, DISCOUNT AND INTEREST RATES. tions for new types of paper will be added from time to time as deemed of interest. In the following tables are presented actual Progress has been made in gathering data discount and interest rates prevailing in the concerning the rates for the several classes of various cities in which the several Federal paper prevailing in these same cities during Reserve Banks and their branches are located, the 30-day periods ending on the 15th day of during the 30-day periods ending August 15 I each month in the years 1911, 1912, and 1913, and September 14, 1918. Quotations are | Difficulty has been experienced in some cases given for prime commercial paper, both cus- | in securing satisfactory data, though in the tomers' and purchased in open market, inter- | great majority of cases data fairly comparable bank loans, bankers' acceptances, and paper | with present quotations have been furnished. secured by prime stock exchange or other cur- It is expected that in a future number of the rent collateral. Separate rates are quoted BULLETIN the material thus secured will be for paper of longer and shorter maturities in collated, thus making possible the presentation the first named and last named classes. In of current quotations as percentages of the addition, quotations are given for commodity averages of quotations for the same periods in paper secured by warehouse receipts and for each of the three earlier years. cattle loans, as reported from centers in which "Between. August and September of the such paper is current. present year there has been in general a con- For the 30-day period ending September 15, tinuance of the slight upward movement in quotations have been added of rates charged interest rates noted for the period ending on ordinary loans to customers secured by August 15. This rise is not confined to any Liberty bonds and certificates of indebtedness. one district. Thus, Boston and San Fran- Assistance to customers to enable them to pur- cisco rates among others show a distinct upchase such Government obligations is generally ward tendency. Customary rates in general, extended at lower rates, either at the rate with few exceptions, remain unchanged, moveborne by such obligations or at a rate slightly ments in rates being confined largely to frachigher. For the first time the table also tional changes in high or low quotations. Kates shows quotations in New York for demand charged on loans to individuals, secured by paper secured by prime bankers' acceptances, a Liberty bonds and certificates of indebtedness, on type of paper which has recently made its the whole are lower than on ordinary commercial appearance in the New York market. Quota- loans, or on loans secured by other collateral. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Discount and interest rates prevailing in various centers* o I DURING 30-DAY PERIOD ENDING AUG. 15,1918. Bankers' acceptances, Collateral loans—Stock exchange or Secured by- 60 to 90 days. other current. Secured by Liberty Interbank Cattle warehouse bonds and District. City. Joans. loans. receipts, certificates etc. of indebt- Indorsed. d U or n s i e n d - . Demand. 3 months. m 3 o t n o t h 6 s. edness. II. L. C. L. C. L. C. ii. L. a II. L. C. m L. a II. L. a No. 1.. Boston 4* 4* 4* 6 6 6 No. 2... New York 5 44 4i 4. 6 41 8 No. 3... Philadelphia.. 4^ 44 4'- 5 6 54 6 No.4.. Cleveland. 44 4 4 5 8 5 6 Pittsburgh 41 4-1 4-1 5 8 5 0 5 41 Cincinnati 4| 44 44 8 8 6 6 No. 5.. Richmond 8 6 6 6 Baltimore 8 6 8 6 6 8 f 8 5* 6 No. 6.. Atlanta 54 &1 64 54 5J 54 7 6 6 64 6 6 No. 7.. J N C D B a h e e i c r i w t k c m r s a o o g O i i n t o n r g v l h e il a a le n m s . . . . , . 6 5 4 8 5 j 5 6 4 6 5 4 8 | 4 4 6 6 5 4 5 . 6 6 . & 5 8 6 6 6 6 8 7 8 6 8 6 " 6 6 7 8 6 6 1 7 } " 5 6 6 ^ 6 6 8 No. 8... St. Louis 0 4f 6 6 4| 6 54 7 54 6 Louisville 6 54 54 0 54 54 I 6 6 6 No. 9... Minneapolis 7 6 64 No. 10.. Kansas City.... 8 8 6' Omaha 7 6 8 8 6 64-7 Denver 6 8 54 6 No. 11.. Dallas 6' 6 10 6 8 Ei Paso 8 8 8 10 8 8 No. 12.. San Francisco.. 54 4-| 54 6 7 5 6 Portland 41 4| Seattle a 44 44 10 10 6 6 j. Spokane 8 6 8!. Salt Lake 6 7 8 6 7j. DURING 30-DAY PERIOD ENDING SEPT. 14, 1918. I No. 1.... Boston 61 55- 6 54 54 4*:: & 41 6 8 6 8 6 5 41 44 No. 2.... New York & 6 44 6 6" 5 54 41 ii 6 4£ 64 5 6 54 6 6 4 4i-5 No. 3.... Philadelphia 6 54 6 6 5 54 44 4* ! * 6" 5 6 54 6 5 41 42 No.4.... Cleveland 6 5" 6 6 5 5 6 5 6 5" 6 6 44 .... Pittsburgh 6 5:J 6 i 8 8 6 4f 41 4§ i 4^ 6 6 6 6 6 6 6 54 4k 54 Cincinnati 6 6' 6 15 54- 6 44 41 4^ ; 4} 74 6 6 8 6 54 44 5 No 5 B Ri a c 't h im mo o n re d 6 5 5 * 4 5 6 2 !!? 1D 5 5 5 5:1 5 - 4 6 6 8 6 6 3 6 6 5 5 4 6 6 5 8 4 6 6 5 6 4 ' 4 4 J 4 5 5 4 No.6.... Atlanta 54 6 54 6" 6 6 6 |b4 8 64 7 54 6 54 6 8 54 6 7 5 54 Birmingham 6" 6 i 8 \l 6~ 6 6 0 8 6" 7 8 6 6 N Ja e c w ks o O n r v le il a l n e s 8 8 5 6 4 7 6 : 8 I? 5 6 1 5 8 4 5-4 51 54 i 1 6 6 6 6 6 6 6 54 6 8 6 7 6 8 4 6 6 6 6 6 8 5 5 5 8 4 No.7 Chicago 6" 6 54 6 3 41 41 "64 6 6 6 No.8.... DSte. trLooiutis 5 5 4 6 8 6 6 5 5 5 6 4 8 42 6 i6 4-1 6 6 6 5 5 4 1 5 5 4 4 6 8 6 41 Tionisvi-le 6 6 6 6 6 5 5" 6 5 6" 6 6 4 5 Memphis I 6 6 6 i. 8 6 6 5 6 6 6 o The 10 per cent rates represent rates charged on loans for small amounts. & Rates for demand paper secured by prime bankers7 acceptances, high 6, low 4£, customary 54. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Discount and interest rates prevailing in various centers—Continued. O DURING 30-DAY PERIOD ENDING SEPT. 14, 1918-Continued. OO Prime commercial paper Bankers' acceptances, Colatcral loans—Stock exchange or Secured by 60 to 90 days. jtlier current Secured by Liberty * District. City. Customers. Open market. Int lo er a b n a s. nk C lo a a t n tl s e . w r a e r c e e h ip o t u s s , e b c o er n t d if s ic a a n te d s etc." of indebt- 3 d 0 a t y o s . 90 m 4 o n to t h 6 s. 30 d a to y s 9 . 0 m 4 o n to t h 6 s. Indorsed. d U or n s i e n d - . J)Cin and. 3 months. n: 3 o n to th 6 s. edness. II. L. C. II L. C. II L. c. IL L. C. 77. C. 77. L. C. IT. L. C. II. L. C. II. 77. L. a ir. L. a ii. L. a IT. L. C. N N o o . . 1 9 0 . . . .. . M K D O e a m in n n a n v s h e a e a a s r p C o i li t s y 6 7 7 8 f 5 5 6 i J 6 6 f 6 t ¥ 88 6 5 6 ft 6 6 f 6 t 6 6 G 7 G f f 6 t t 6 6 f 6 t 6 2 67 G 6 ft G 6 f G t 6 6 7 7 o 0 -V S 6 6 ft 4^ 4£ 4! 7 7 8 6 8 f G t 6 G G G 3 " ,- 8 R G 6 f 0 t 6 6 G 6 7 7 8 8 6 6 6 6 6 6 ft 2 8 s 8 \ 6 6 6 6 6 8 -7 6 6 6 6 6 6 7 5 4 6 5 - i 5 - 6 6 5 6 1 No. 11 ..Dallas . 8 G ft 8 ft ft 0 f> 10 6 8 8 5 5 Ei Paso 8 61 8 8 6-V 8 7 6 8 8 8 8 8 8 8 8 8 10 8 9 8 8 8 No. 12... S P S S a p e o n a o rt t k l t F a l a e r n n a d e ncisco 8 8 s 6 5 o 6 5 " 4 f f 7 - t t 6 8 8 8 5 6 ft 6 f 7 t f f t t " 1- ' ft f t 6 t t ft1 G f < t \ 6 f f t t t f 7 6 t t 0 f f 6 t t 3-5 G o 6 .', 6 ^3 A 4 S i G A-J , i , 6 ja ^ 4 s ^ 8 ^ 8 ft 6 6 7 8 9 5 6 G 6 6 ; 8 •' •; 0 f 0 t 6 7 6 G 8 4 4 4 i 1 | 6 6 4| Sa>t Lake. . 8 6 7 8 6 7 6 6 G 6 i\ ft 7 G 0 8 6 7 8 6 7 8 6 7 6 6 6 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOHKB 1, .1918. FEDERAL RESERVE BULLETIN. 1019 GOLD SETTLEMENT FUND. balances adjusted between the Federal Reserve Banks amounted to $82,254,000, as compared Operations through, the gold settlement fund with $77,548,500 during the preceding period. for the four-week period from August 22 to Changes in the ownership of gold in the September 19 show a continued heavy movebanks* fund through transfers and settlements ment of funds away from New York through during the four-week period amounted to 2.45 the daily settlements, largely on account of per cent of the total obligations settled, as the interior banks paying for their subscrip- against 3.42 per cent for the preceding livetions to Treasury certificates of indebtedness week period. Net changes in the ownershiD in New York exchange. The New York of gold since the commencement of the opera- Federal Reserve Bank's net aggregate debits tion of the fund on May 20, 1915, to September in the daily settlements during the four-week 19, 1.918, amount to 1 per cent of the total period amounted to $270,903,000. Thore was obligations settled during that period. a return movement of funds to New York Net deposits of gold in the banks' fund from through transfers from other Federal Reserve August 22 to September 19 amounted to Banks aggregating 8197,000,000, largely on ac- 839,429,000, the Chicago, -San Francisco, New count, of fiscal operations of the Treasury of the York, and Cleveland banks being the heaviest United States. The net result is seen in. a loss depositors. Net withdrawals of gold by of gold by the Now York bank through trans- the Federal Reserve agents amounted to fers and settlements of §73,908,000. Combined $14,400,000, largely for transfer to their credit clearings and transfers through the fund for the in the gold redemption fund against Federal four-week period, amounted to $3,713,793,000, Reserve notes. The resulting gain of gold in averaging $928,448,250 per week, against a the combined funds was §25,029,000. like average of $904,651,600 for the preceding Below are given figures showing the operalive-week period and an average of $869,243,000 tions of the fund between August 23 and per week for the current year. Average weekly September 19, 1918, both inclusive: Amounts of clearings and transfers through the gold settlement fund by Federal Reserve Banlcs from Aug. ,3, 1918, to Sept. 19, 1918, both inclusive. [In thousands of dollars.] Total a B d a j l u a s n t c e e d s . Transfers. Settlements of— j Aup. 23-29 89-1,369 93,923 1 47,000 Aus. 30-Sopt. 5. 787,282 47,531 ' 79,000 Sept. (3-12 852,452 126,024 35,102 Sept. 13-3 S 959,528 61,518 59,000 Total 3,493.631 329,010 220,162 Previously reported for 1918.. 26, 380, G27 1,990,452 2.929,330 Total sinno Jan. 1,1918. 29,880,258 2,319,408 3.149,992 Total for 1917 24,319,200 2,154,721 2,830,604.5 CLEARINGS AMD TRANSFERS. Total for 1918 to date 33,030,250 Total for 1917 27,154,704.5 Total for 1916 5,533,966 Total .or 1915 1,052,649 Total clearings and transfers from May 20,1915, to Sept. 19,1918 66,771,569.5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1020 FEDEKAI, EESEJRVE BULLETIN. OCTOBER 1,1913. Changes in ownership of gold. [In thousands of dollars.] Total to Aug. 22, From Aug. 23,1918, to Sept. 19,1918, both Total changes from 1918/' inclusive. M S ay e pt 2 . 0 1 , 9, 1 9 1 1 9 5 1 , 8 . t o - Balance to Federal Reserve Bank, credit Aug. cr D ea e s - e. cr I e n a - se. de 2 p 2 p lu , o s s 1 i 9 n t 1 s e 8 t o . f S B e a 1 p l 9 a t 1 . n 8 1 c . 9 e , cre D a e s - e. cr I e n a - se. cr D e e a - se. cr I e n a - se. sold since that date. Boston 01,238 78. 67,683 10,731 50,507 New Yorlc 593,150 116, 42,716 73,903 667,053 Philadelphia. - 86,944 57, 71,539 13,701 100,645 Cleveland 135,755 42. 53,355 10,734 146,489 Richmond 18,150 20, 25,117 '(,005 23,155 Atlanta 38,291 9, 11,040 1,776 40,067 Chicago 47,987 51, 80,089 28,903 76,950 , St. Louis 53,290 21,116 4,247 49,043 Minneapolis... 4,146 20,823 12,858 8,712 Kansas City... 52,449 26, 23,748 '"2*267* 50,182 Pallas 18,617 7,622 11,721 30.338 San Francisco. 84,575 40,339 6,390 90)965 Total 597,290 597,296 465,787 4G5,787 91,148 91,148 667,053 667,053 i Debit balance. Gold settlement fund—Summary of transactions from Aug. 23, 1918, to Sept. 19, 1918, both inclusive, [In thousands of dollars.] Aggro- Aggr. Transfers. Daily settlements, Aug. 23, 1918, to Balance i gate gato do- Sept. 19,1918, both inclusive. Balance last | Gold with- posits in state- | with- drawals and fund at Federal Ileserve Bank. —"-+• ! draw- and trans- elos? of A 1 u 9 g 1 . 8 2 . 2,! als. tr a a g n e t s o n f t e s r ' s ag f f r e e o r n m s ts' Debit. Credit. de N b e it t s. d T e o b t i a ts l . c T re o d t i a t l s. cr N ed e i t ts. b S u e 1 s p 9 i t 1 n . 8 e 1 . s 9 s , fund. fund. Boston 76,493 i 1.921 1,921 2,000 17,250 284,765 276,034 8,519 67,683 "Now York 121,256 ! o)363 20,000 15,393 197,000 270,903 1,211,780 940,877 42,716 C Ph le i v la e d la e n lp d hia S 6 26 O 2 , , , 7 3 6 6 9 6 7 0 2 2,0 1 4 0 2 4 0 ! i ! 3 5 , , 0 0 8 4 4 0 9 1 3 2 1 7 2 1 , , ,1 0 5 0 4 0 0 2 1 6 5, , 0 5 8 0 " 4 4 1 8 9 1 5 7 , , 0 00 0 0 0 13,062 16 1, , 5 3 7 2 5 2 3 3 1 6 8 2 3 7 0 , , , 2 0 0 7 1 5 0 7 8 3 3 1 8 3 9 0 5 2 , , , 9 7 0 0 9 2 9 2 2 3 1 0 2 7 , , , . 0 6 r 5 3 i 6 9 80 5 2 7 5 3 1 ) . , 1 5 3 3 1 5 9 7 5 Richmond I21,886 30 ! 2,158 24,880 12,858 162 7,304 114,581 116,522 9,242 11,640 CAht liacnagtao. 76,529 .1 i 13,410 41,226 15,823 70,000 100 404,856 503,719 98,863 80,089 St. Louis 29,180 683 j 1,866 5,683 1,866 8,726 232,206 227,959 4,479 21,116 .Minneapolis 10,21.5 ! 750 3,000 750 "5,"666' 6,930 105,481 113,3$9 14,794 20,823 Kansas City 34,129 I 886 9,000 886 59,000 140,279 197,012 58,733 23,74.8 Dallas....."... 8,591 1,910 | 220 12,910 220 23,000 5,000 i 60,780 90,501 29,721 7,622 San Francisco 42,718 2,040 i 10,771 19,540 10,771 44,000 68,555 l!8,94r> 50,390 40,339 Total 569,816 6,809 | 46,238 | 176,885 j 72,856 220,162 220,162 j 329,016 3,493,631 3,493,631 329,016 465,787 Federal Reserve agents9 fund—Summary of transactions from Aug. 23, 1918, to Sept. 19, 1918, both inclusive. [In thousands of dollars.] Federal "Reserve agent at— m la B 2 e s 2 n a t , l t 1 s , a 9 t n A 1 a c 8 t u e e . s " - ;. dr w G aw i o t l h a d - ls. de G po ol s d its. fu t r d o W r t a r b a w i a t n h a n s - l k f s e . rs D t tr h b e a I r a p r n o n o o s u ! f m s ? g e i . h ' t r s s dr T w a o w it t h a a - l l s. de T p o o t s a i l ts. a S b t B u e a c 1 p s l l 9 i o a t 1 n . s 8 n e e . 1 c s 9 e o s , f B^'-ton . . .. 48,500 2,500 2 500 40,000 New York 100,000 10,COO 20,000 10,000 26.666 110,000 Philadelphia.. 92,314 1,000 3,505 11,000 4,505 11.000 99,409 90 000 20,000 20',000 110,000 36,500 7.500 7,500 44,000 Atlanta... 20,620 2,000 10,700 24.850 12, 700 24,850 32,770 154,205 3,000 2,413 41,226 5,413 41,226 190,018 St. Louis 50,131 1,500 5,000 1,500 5,000 53,631 8,300 3,000 3,000 11,300 Kansas City , 46,360 9,000 9,000 55,360 Dallas 584 1,400 11,000 1,400 11,000 10,184 San Francisco 70,201 3,000 17,500 3,000 17,500 84,701 To t al 718,315 14,400 26,618 170,076 41,018 170,076 847,373 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1018.. FEDERAL BESERVE BULLETIN. 1021 OPERATION OF THE FEDERAL RESERVE CLEARING SYSTEM, AUG. 16 TO SEPT. 15, 1918. Items drawn on It b e a R m v a e n e s s r k e a s r g v d e e i r ) n c a . i w ty F n e ( d d a e o i r n l a y l a b o R v a u e e n t s s r k e a i r d s g v e e e ) i n . c F i t e y d d i ( s d e t a r r i i a l c y l t ; Ite t a b r m g a ic e n s t ) k s .! s d ( i d n r a a i o w ly th n e a r v d o e i n r s - - Number. Amount. Number. | Amount. | Number.j Amount. Boston 6,082 817,374,473 57,839 88,811,516 • 6,207 §8,112,675 New York 10,767 79,681,300 79,297 51,598,324 ! 34,983 17,998,399 Philadelphia 10,671 21,845,793 32,781 4,375,772 j 15,328 10,70S,949 Cleveland ". 2,524 6,320,000 44,121 20,142,478 I 2,745 4,390,129 Richmond 1,773 5,507,000 35,170 11,531.291 i 5,438 6,621,784 Atlanta 1,797 1,741,593 17,931 5,210^972 i 1,667 2,738,120 Chicago 10,057 22,022,000 46,786 11,505,000 4,457 1,035,000 St. Louis 3,958 8,129,980 25,251 5,149,596 914 1,215,077 Minneapolis 2,847 7,279,516 15,473 1,698,493 892 1,798,092 Kansas City 2,362 8,488,077 41,872 11,225,146 ! 5,712 5,191,636 Dallas 1,156 1,363,432 20,439 6,323,155 1,760 1,544,586 San Francisco 1,129 2,668,463 25,019 7,803,061 452 1,410.513 Totals: Aug. 16 to Sept. 15, 1918 182,321,867 441,979 145,374,804 80,555 62,764,960 July 16 to Aug. 15, 1918 172,600,132 406,330 131,047,263 76,404 58,502.291 June 16 to July 15, 1918 192,220,658 391,261 143,751,620 74,128 72,555; 997 May 16 to June 15, 191S , 164,539,000 295,056 113,407,619 54,132 55,703,310 Apr. 16 to May 15, 1918 178,372,385 287,061 114,099,520 54,888 58,513,363 Mar. 16 to Apr. 15, 1918 159;441,188 271,506 98,201,962 53,725 53,391,691 Feb. 16 to Mar. 15, 191S 153,701,375 259,531 113,134,162 51,259 46,556,709 Jan. 16 to Feb. 15. 1918 1153,847,568 227,312 80,248,466 44,654 42,852,372 Dec. 16, 1917, to Jan. 15, 1918 il48,033,108 253,458 89,065,135 49,342 52,175,578 Nov. 16 to Dec. 15, 1917 ! 171,723,439 240,756 84,440,761 46,353 58,458.952 Oct. 16 to Nov. 15, 1917 1166,552.773 232,723 64,296,210 45.393 53.089; 827 Sept. 16 to Oct. 15, 1917 |128,271',466 212,935 47,476,204 40,216 44'. 98-1,581 Aug. 16 to Sept. 15, 1917 1100,331,694 182,191 41,323,621 32,564 40;648,168 July 16 to Aug. 15, 1917 I 98,075,919 175,625 40,353,278 31,273 37,981.022 June 16 to July 15, 1917 109,722,256 182,622 41,004,720 33,941 46,762; 698 May 16 to June 16, 1917 , 97,322,883 179,193 38,599,461 33,150 38,314,393 Apr. 16 to May 15, 1917 87,370,859 171,093 36,473,163 33;428 36,836,934 60,288,002 168,607 32,666,959 32,008 34,693.542 Total, exclusive of Ite a b ( m d o n a d t s h i l y p h a a a b v r n r e e d a n r l a n e t g d c e b h ) a .i e n b s k y i ( T U t d e r a n m e i i l a y s t e s a d u d v r e r e r a a r S g w e t ) 1 a . 1 te o s 0 f nIte T U (d m r a n e i s i l a y te s d a d u v r r a e e r w r a S g n t e a ) t . o e o n s f b N o e i f n u r m m b d a e i b s n m e - k r - s ! j b N m a o u n e f m m k n s o b b o n e e n r r trict. ! par list. Number. | Amount. Number. Amount. Number. Amount. Boston 70,128 534,298,904 9,143 85,922,140 418 ! 267 New York 125,047 149,178,023 41,776 19,436,129 703 ! 346 Philadelphia 58,780 36,930,514 6,815 1,177,042 630 ! 325 Cleveland 1,300 i 82,271,070 50,690 33,128,677 •3.877 2,466,923 798 697 Richmond 180 637,857 42;561 I 24,297,932 X640 488,891 554 356 Atlanta 2,933 623,754 24,328 10,314.439 3,324 1,189,629 4.14 317 Chicago 249 237,000 61,549 ! 34,799; 000 8,639 4,773,000 1,253 2,409 St. Louis 540 289,396 30,663 ; 14,784,049 4,650 I 1,151,354 502 1,049 Minneapolis 19,212 : 10,776,101 517 i 171,099 842 1,196 Kansas City 2.5S6 I 862,461 52,532 i 25,767,320 2,483 j 412,041 986 2,208 Dallas 881 ! 184,380 24,236 9,415,553 2,066 i 495,278 707 245 San Francisco 2,384 i 1,760,387 28,984 '• 13,642,424 2,283 ' 8,012,117 621 I 1,134 Totals: Aug. 16 to Sept. 15, 1918 11,053 i 6,866,305 588,710 i397,327,936 87,213 45,695,643 8,428 10,549 July 16 to Aug. 15, 1918... J j 13.395 • 11,254,817 546,358 I373,404,503 81,323 41,063,646 8,294 10,206 June 16 to July 15, 1918 19,212,816 538,98-1 '427,741,091 82,536 47,181,467 8,212 9.761 May 16 to Juno 15, 1918 7, G2312,355,115 407,866 346,005,044 77,750 39,054,003 8,165 9', 710 Apr. 16 to May 15. 1918 8,294 15,141,604 i399,812 :366,126,872 60,771 30,928,185 8,113 9,475 Mar. 16 to Apr. 15', 1918 7.793 8,942,976 |388,058 319,977,817 69,228 31,563,675 8,059 9,450 Feb. 16 to Mar. 15, 1918 7; 700 6,413,071 '369,898 321,805,317 58,991 25,827.757 8,013 9.425 Ja». 16 to Feb. 15, 1918 7,128 5,836,958 325,301 :282,785,364 48,224 21,316', 033 7,972 9', 319 Dec. 16, 1917, to Jan. 15, 1918 ?; 718 3,402,035. 359,067 :292,585,856 38,130 21,116,293 7,909 9,268 Nov. 16 to Dec. 15, 1917 343,787 '314,623,152 33,806 27,179,053 7,823 9,321 Oct. 16 to Nov. 15, 1917 325,690 ;283,938,810 30,426 17,496,974 7,826 9,210 Sept. 16 to Oct. 15. 1917 293.742 !220,732,251 26,797 13,518,566 7,747 9,052 Aug. 16 to Sept. 15, 1917 251,061 182,303,483 23,492 11,006,515 7,718 8,934 July 16 to Aug. 15, 1917 243,625 176,410,219 19,533 9,701,569 7,683 8,837 June 16 to July 15, 1917 255,039 197,489,674 19,100 11,637,899 7,666 8,805 May 16 to Juno 16, 1917 250,241 174,236,737 16,344 4,414,508 7,651 8,789 A Ma p r r . . 1 16 6 t 1 o 0 A M p a r y . 1 1 5 5 , , 1 1 9 9 1 1 7 7 2 2 3 3 1 8 , , 7 2 7 8 7 8 j1 1 2 6 7 0 , ,6 6 8 4 0 8 , , 9 5 5 0 6 3 1 1 5 2 , , 9 5 2 8 5 2 2 3 , , 6 5 4 9 3 7 , ,8 4 6 0 5 8 7 7 , ,6 6 3 2 4 5 8 8 , , 6 92 0 6 7 1 Items drawn on banks in other districts (columns 5 and 6), also items handled by both parent bank and branches (columns 7 and 8), represent duplications of items shown in columns 1 to 4. Such items are counted both by the Federal Reserve Bank or branch at which.; they are deposited and also by the Federal Reserve Bank or branch to which they are forwarded for ultimate collection. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1022 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. DISCOUNT OPERATIONS OF THE FEDERAL RESERVE BANKS. Discount operations of the Federal Keserve BostonJNew|York,T!leveland, and San Fran- Banks during the month of August aggregated ciscojbanks.f $3,762,359,098, compared with $3,343,456,443 fgOver 92|per cent of all the paper discounted for July and $3,161,920,534 for June. Of the during the month was 15-day paper, i. e., matotal bills discounted during the month, the turing within 15 days from date of discount share of war paper, i. e., member banks' notes with the Federal Eeserve Banks. For the New and customers' paper secured by United States York bank this percentage, because of the war obligations, was 83.1 per cent, compared large amount of member banks' notes handled, with 73.9 per cent the month before and 82.9 runs as high as 96.8 per cent. Marketing of per cent for June of the present year. About the wheat crop is apparently responsible for 61.3 per cent of the total discounts and over the large decrease in the discounts of 6-month 65 per cent of the war paper discounted during paper from $25,263,873 in July to $8,840,308 the month, as against 58 and 64 per cent the in the month under review. month before, are reported by the New York Average maturities of the paper discounted, bank. Outside of New York the largest in- except by the three Eastern and the Cleveland creases in discount operations for the month, banks, were shorter than for the month before, as compared with July, mainly under the head the decreases being especially marked in the of war paper, are shown for the Minneapolis, case of the Minneapolis, Kansas City, and Philadelphia, Atlanta, and Dallas banks. Dallas banks because of the large reduction in Owing to reclassification of the discount ma- the amounts of 6-month paper handled by terial by the Chicago bank the amount of col- these banks. For the system as a whole the lateral notes secured by eligible paper shows ade- average maturity of the paper discounted durcreasefrom $162,910,586 for July to $56,476,330 ing the month works out at 12.7 days, comfor August, the amount reported by the Chicago pared with 12.85 days in June. Average rates bank declining from $126,593,975 to $25,383,- of discount show the largest declines for the 495. Inversely, "All other discounts " reported same banks, for which the average maturities by that bank show an increase from $48,814,937 show the greatest decreases. Minneapolis, for July to $116,413,498 for August. Trade ac- Dallas, and Kansas City in the order named ceptances discounted by all the banks during show the longest average maturities of the the month totaled $13,568,349, of which $11,- paper discounted during the month, while 774,139 (as against $13,712,264 in July) repre- Dallas, Minneapolis, and San Francisco show sented transactions in the domestic trade and the highest average rates of discount charged $1,794,210 (as against $562,776 in July) trans- during the month. For the system as a whole actions in the foreign trade. Nearly 38 per the average rate works out at 4.25 as against cent of the discounted domestic trade ac- 4.37 per cent in July. ceptances are reported by the New York bank On the last Friday of the month the banks and about 18 per cent by Cleveland, Chicago held a total of $1,428,195,000 of discounted being the only other bank showing over one paper as against $1,302,151,000 on the last million of this class of paper for the month. Friday in July. Of the total discounts on hand The totals above given are exclusive of the share of war paper was 62.7 per cent, com- $6,134,247 of foreign trade acceptances and of pared with 52.2 per cent about the end of July $1,645,720 of domestic trade acceptances bought and 48.8 per cent about the end of June. At during the month in the open market by the the New York bank this share was over 74 per Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN". 1023 cent, and at the Boston and Philadelphia banks Federal Reserve Banks during the month over 71 per cent. Discounted trade accept- under review. ances on hand totaled $15,487,000, as against In the following exhibit are given the number $17,379,000 about a month before. Of the of member banks in each Federal Reserve disformer total over one million were foreign trade trict at the end of August and the number of acceptances all held by the New York bank. discounting member banks during that month: Nearly one-half of all the discounted trade ac- Number of mem- Number of memceptances are held by the New York and ber banks in dis- ber banks ac- Federal Reserve Bank. trict. commodated. Cleveland banks. Agricultural paper holdings totaled $38,293,000, as against $36,456,000 the August. I July. August. July. month before, while live-stock paper totaled Boston 417 416 215 182 $50,906,000, of which nearly one-half' is re- New York.... 703 695 335 323 Philadelphia.. 653 851 270 245 ported by the Kansas City bank. Cleveland 796 ' 787 144 166 Richmond 554 550 261 268 The month witnessed 130 new accessions to Atlanta 412 414 207 214 Chicago 1,251 1,190 562 543 membership, the total membership at the end St. Louis 503 170 139 Minneapolis... 843 395 399 of August being 8,453 banks. Over 43 per cent Kansas Citv... 989 984 290 327 Dallas 715 704 436 4.24 of this number, or 3,671 member banks, as San Francisco. 617 610 386 232 against 3,462 in July, discounted with their Total... 8,453 8,323 3,671 3,462 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1024 FEDERAL RESERVE BULLETIN". OCTOBER 1,1918. Bills discounted during the month of August, 1918, distributed, by classes. Member banks' collateral ! Customers' notes. paper secured by- Secured by Federal Reserve Bank. S b L t U o a i n t n b e d i e s t s r e c t d o y e r r- S b L t U o a i n t n b e d i e s t s r e c t d o y e r r- O se th c e u r r w ed is . e c T e r p a t d a e n c a e c s - . d A is n c o o t u h n e t r s. Total. tificates of tificates of indebtedness.indebtedness. Boston .526,591,023 $88,800,196 $918,000 $602,986 $6,828,518 $123,740,723 New York * 51,817,705 1,997,927,111 i 6,141,658 250,200,396 2,306,086,870 Philadelphia. 19,026,615 91,960,382 557,442 35,721,623 147,266,062 Cleveland.. *. 4,622,533 89,755,710 1,655,000 2,048,621 33,174,966 131,256,830 Richmond 5,008,415 151,944,645 1,925,500 772,059 9,168,682 168,819,301 Atlanta 284,729 55,559,1(J2 345,000 175,920 25,980,985 82,345,796 Chicago 6,056,940 256,902,885 25,383,495 1,073,997 116,413,498 405,830,815 St. Louis 736,719 71,292,183 50,000 742,458 19,238,289 92,059,649 Minneapolis.. 2,867,225 45,844,500 16,053,903 100,510 21,941,036 86,807,174 Kansas City.. 503,000 39,849,829 8,442,332 525,548 9,427,334 58,748,043 Dallas 1,188,771 50,661,040 1,703,100 146,213 13,881,097 67,580,221 San Francisco 1,303,396 66,924,933 2 680,937 22,908,348 91,817,614 Total... 120,007,071 3,007,422,576 56,476,3 13,568,349 564,884,772 3,762,359,098 1 Includes $1,711,375 in the foreign trade. 2 Includes $82,835 in the foreign trade. Amounts of discounted paper, including member banks' collateral notes, held by each Federal Reserve Bank, on the last Friday in August, 1918, distributed by classes. [In thousands of dollars, i. e., 000 omitted.] Member banks' collateral notes. Customers' i paper sccuredi Banks. Ag p ri a c p u e lt r u . ral Li p v a e- p s e to r. ck u b n y b it o e L n d i d b s S e t r o a t r y t " e s ; i S b e L o c i u n b r d e e s r d t o y b r " y Otherwise Trade d A is l c l o o u th n e ts r . Total. certificates of .United States secured. jindebtedness.-, certificates of I indebtedness. Boston 14 22,872 i 28,787 742 19,773 72,188 New York 587 "l 65,639 i 350,082 14,092 141,239 561,639 Philadelphia... 421 921 ! 26,096 i 39,355 735 23,742 91,270 Cleveland 84 972 j 6,173 | 37,691 1,640 3,539 39,893 89,992 Richmond 4,998 6,581 : 33,658 1,330 1,456 10,615 58,642 Atlanta 3,153 1,112 I 389 26,435 79 429 18,259 49,855 Chicago 5,629 91 ! 11,281 109,253 42,237 1,639 44,022 214,152 St. Louis 397 472 ; 1,236 . 31,4.77 1,127 17,854 Minneapolis... 4,825 10,923 i 3,766 ; 21,001 257 10,676 59,941 Kansas City... 3,453 24,764 j oil i 16,398 3,735 420 9,654 58,935 Dallas 5,985 5,198 : 950 I 23,511 6,787 42,431 San Francisco. 8,747 6,449 : 1,950 , 30,804 1,051 27,555 76,556 Total. :8,293 50,903 j 147,444 ; 748,452 ! 57,544 15,487 370,069 1,428,195 Percent 3.6 i 10.3 ! 52.4 ! 4.0 1.1 25.9 100.0 1 Includes SI, 043,450 in the foreign trade. Bills discounted by each Federal Reserve Bank during August, 1918, distributed by rates of discount; also average maturities and rates of bills discounted by each bank during the month. 4 per cent. 4£ per cent. 44 per cent. 4| per cent. Amount. ! Discount. Amount. Discount. Amount. ! Discount. Amount. Discount. | Boston $93,785,795 | $97,433 $24,759,746 8231,402 $002,987 S3,708 $4,576,062 $27,876 New York 2,231,080,672 I 1,408,203 50,790,141 475.580 1,749,258 I 13,045 22,442,240 198,932 Philadelphia I 127,631,075 192.543 16,597,956 151,573 548,606 ! 2,535 2,483,175 13,544 Cleveland ! 72,094,815 . 106,178 49,775,836 105,193 1,707,391 ! 12,369 7,078,788 55,489 Richmond 157,203,489 163,187 65,744 ; 4,250,914 11,008 Atlanta ! 73,489,437 \ 118,553 328,169 2,072 148,029 8,170,401 62,933 Chicago ! 304,449,053 j 492,855 0,492,779 48.500 76,611,246 150,927 17,406,652 132,832 St. Louis ! 77,793,852 ' 120,236 729,149 6:i3S 5,961,901 11,823 7,326,908 55,504 Minneapolis | 63,514,617 : 103,519 2,537,225 19', 592 ' 88,127 489 8,609,446 51,582 Kansas City i 41,891,783 74,605 7.815,521 13,405 466,947 3,058 Dallas 52,626,653 i 85,062 1,020,332 7,755 146,213 982 4,732,746 28,282 SanFrancisco 71,441,677 1 117,129 2,431,323 13,751 495,256 3,751 14,935,418 131,713 Total 3,168,507,546 ' 2,841,711 354,557,928 1,299,348 95,940,279 214,089 102,479,697 772,753 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1025 Bills discounted by each Federal Reserve Bank during August, 1918, distributed by rates of discount; also ave rage maturities and rates of bills discounted by each bank during the month—Continued. 5 per cent. 5\- per cent. 5J per cent. Total. Average Average Amount. " i Discount. Amount. Discount. Amount. Discount. \ Amount. Discount, i maturity ra c t e e n ( t) p . e i r ~r Boston $16,133 $239 $123,740,723 5300,658 | 25.23 4.22 New York... 24,059 164 2,300'. 080.870 2,095,924 ; 8.05 4.12 Philadelphia. 5,250 88 147,206,062 300/283 I 21.32 4.13 Cleveland. 131,256,830 279,229 j 18.03 4.25 Richmond I 7,187,024 58,989 $112,130 51,813 ;. 108,819,301 235,003 | 11.27 I 4.4b Atlanta ! 209; 760 3,316 82,345,796 187,863 I 19.35 4.24 Chicago ! $871,085 I 818,344 405.830,815 843,458 ! 17.69 4.23 St. Louis : 247,839 | 4,854 92;059,649 198.555 ; 18.26 4.25 Minneapolis i 11,122,496 118,187 935,263 17,850 86,807,174 311.; 219 ! 28.34 4.55 Kansas City I 6,856,749 I 60,200 1,717.043 i 34.091 58.748.043 185,419 ; 23.81 4.77 Dallas ! 7,250,324 79,358 1,803,953 \ 34,074 O7'.5SO;221 235,513 i 27.50 4.56 San Francisco i 220,976 2,474 | • ".....; 2,292,964LT 43,713 91; 817,614 312,531 i 27.26 ' 4.50 Total j 26,036,622 262,815 I 8,772,832 \ 0,147 j 6,004,194 | 118,852 J3.762,359,093 5,005,715 j 12.70 | 2 4. 25 1 Boston and New York calculated on a 365-day basis; ail other Federal Reserve Banks on 360-day basis. 2 Average discount rate on all paper discounted works out at 4.22 per cent if calculated on a 360-day basis, and at 4.28 per cent if calculated en a uniform 365-day basis. Acceptances bought in open market and held by all Federal Reserve Banks on dates specified, distributed by classes of accepting institutions. ];ankers' accepI:ances. Trade acceptances Date. M ba e n m k b s e . r N c o o n m t m r p u e a s m n t i b es o . r N St o a n te m b e a m n b k c s r . P b r a i n v k a s te . b F r b a o a n a r n e n c d i h k g e n s Total. b m ou o a g p r h e k n t e t i . n acc T ep o t t a a n l c , es. agencies. 1915. Feb. 22. S93,000 893,000 $93,000 Apr. 5.. 3,653,000 S7,820,000 810,000 8110,000 11,593,000 11,593,000 July 3.. 4,342,000 5,207,000 161,000 9.770.000 9,770,000 Oct. 4.. 9,000,000 4,898,000 "i32,"666 343,000 14;373; 000 14,373,000 1916. Jan. 3.. 15,494,000 7,100,000 362,000 822,000 I 23,838,000 23,838,000 Apr. 3. 21,000,000 13,572,000 473,000 3,262,000 ! 38,308,000 $722,000 ! 39,030,000 July 3. 32,989,000 18,921,000 471,000 11,830,000 64,211,000 3,422,000 i 67,633,000 Oct. 2. 37,798,000 21,782,000 712,000 9,944,000 70,236,000 2,306,000 i 72,542,000 1917. Jan.1 66,803,000 34,625,000 1,502,000 18,224,000 ! 121,154,000 4,585,000 ' 125,739,000 Apr. 2 43,979,000 20,328,000 089,000 16,830,000 I 3200,000 i 82,020,000 1,144,000 i 83,170,000 July 14-16. 108,597,000 30,390,000 3,333,000 38,082,000 I 3,805,000 ! 184,785,000 4,660,000 I 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 Dec. 31.... 227,717,000 8,163,000 3,179,000 20,137,000 ' 7,657,000 ! 266,853,000 6,383,000 i 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 I 284,737,000 Feb. 28. 252,747,000 1,048; 000 3,Son,000 28,419,000 I 7,097,000 ! 293,767,000 ! 5,456,000 i 299,223,000 Mar. 31. 275,144,000 1,360,000 1,884,000 31,779,000 ; 8,562,000 : 318,729,000! 8,015,000 j 326,744,000 Apr. 30. 248,390,000 654,000 2,907,000 25,921,000 j 10,304,000 288,176,000 9,279,000 i 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 ! 257,306,000 June 29. 173,698,000 1,992,000 '459;000 21,478,000 i 12;315,000 ! 209,942;000 7;418.000 . 217,360,000 July 31.. 154,614,000 1,129,000 7,302,000 18,082,000 ! 8,975,000 i 190,102,000 7,781;000 ! 197,883,000 Aug. 31. 188,366,000 1,717,000 8,264,000 19,167,000 ! i 8,450,000 : 225,964'000 8,806,000 ! 234,770,000 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1026 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Acceptances bought in open market and held by each Federal Reserve Bank, on August SI, 1918, distributed by classes of accepting institutions. [In thousands of dollars; i. o., 000 omitted.] Foreign Trade acceptances bought in open Feder B al a n R k e . serve M ba e n m k b s e . r c N b o e o m r n p m t a r n c u i m s e t s - . N b b e o r a n n m S k t e s a m . te - P b r a i n v k a s t . e br b a a a n n n c d k h s e , s, Total. market. a a T c n c o c e t e p a s l t . agencies. Domestic. Foreign. Total. Boston." 26,243 761 1,010 130 28,144 398 259 657 28,801 New York 90,804 426" 6,284 14,671 7,939 120,118 1,379 378 1,757 121,875 Philadelphia 8,609 752 433 9,794 9,794 Cleveland 23,746 250~ 349 1,727 161 26,233 424 53 477 26,710 Richmond 4,782 4,782 4,782 Atlanta 3,577 3,577 3,577 Chicago 15,502 1,000 18 16,520 16,520 St. Louis 1,672 23 1,695 1,695 Minneapolis 297 297 297 Kansas City 136 136 136 Dallas 554 554 554 San Francisco 12,444 47 100 1,303 220 14,114 5.915 5,915 20,029 Total 188,366 1,717 8,264 19,167. 8,450 225,964 2,201 6,605 8,806 234,770 Amounts of bills discounted and acceptances and warrants bought by each Federal Reserve Bank during August, 1918, distributed by maturities. 15-day maturities. 30-day maturities. Accept- Accept- Discounts. ances. Warrants. Total. Discounts. ances. Warrants. Total. Boston $93,918,843 §994,968 $94,913,811 $2,279,846 $2,247,528 $4,527,374 Now York 2,231,922,572 13,931,865 2,245,854,437 3,746,514 19,546,798 23,293,312 Philadelphia... 127,793,462 451,049 128,244,511 2,344,326 2,344,326 Cleveland 118,418,935 173,846 118,592,781 1,765,132 749,410 2,514,542 Richmond 156,488,559 249,600 156,738,159 1,463,946 3,393,400 4,857,346 Atlanta 73,586,243 9,400 73,595,643 1,098,471 194,528 1,292,999 Chicago 381,635,279 20,800 381,656,079 2,700,382 623,460 3,323,842 St. Louis 83,169, 738 90,000 83,259,738 1,444,047 25,000 1,469,047 Minneapolis... 17,347,038 250,300 17,597,338 11,800,199 32,000 11,832,199 Kansas City... 49,194,750 49,194,750 710,998 710,998 Dallas 52,626,654 80,000 52,706,654 1,005,277 54,214 1,059,491 San Francisco. 72,680,772 2,234,280 74,915,052 1,877,615 973,788 2,851,403 Total.... 3,458,782,845 18,486,108 3,477,268,953 32,236,753 27,840,126 60,076,879 Percent 1.5 60-day maturities. 90-day maturities. | Discounts. Accept- Warrants. Total. Discounts. A a c n c c e e p s. t- Warrants. Total. Boston j $4,920,658 733.894 $7,654,552 $22,605,243 $13,135,349 $35,740,592 New York j 8,420,032 461,019 35,881,051 61,973,093 30,922,336 92,895,429 Philadelphia I 2,529,153 555,779 3,084,932 14,593,871 2,073,342 16,667,213 Cleveland | 3,844,740 125,872 9,970,612 7,208,494 8,238,194 15,446,688 Richmond ! 3,571,279 121,274 4,692,553 7,183,387 999,000 8,182,387 Atlanta ! 3,270,484 149,880 S40,610 3,460,974 4,173,038 1,223,755 $5,075 5,401,868 Chicago i 7,681,602 843,146 9,524,748 12,941,692 21,172,628 St. Louis ; 3,122,821 170,000 3,292,821 4,075,205 635,225 4,710,430 Minneapolis j 1,032,327 1,032,327 54,764,487 140,000 54,904,487 Kansas City ! 2,589,122 ,6 2,638,737 4,545,130 10,000 4,555,130 Dallas ! 4,234,429 550,000 4,784,429 7,908,969 30,000 7,938,969 San Francisco \ 3,542,458 :, 061, 161 7,603,619 11,767,478 5,389,242 17,156,720 Total 48,759,105 44,821,640 40,610 93,621,355 213,740,087 71,027,379 5,075 284,772,541 Per cent 2.4 7.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1027 Amounts of bills discounted and acceptances and v:arrants bought by each Federal Reserve Bank during August, 1918, distributed by maturities— Continued. Over 90-day maturities. • Total. Per cent. Discounts. 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 t r s - . Total. co D u is n - ts. A a c n c c e e p s t . - r W an a t r s - . Total. Boston $16,133 $28,000 $44,133 $123,740,723 819,139,739 $142,880,462 86.6 13.4 100 New York .. 24,659 24,659 2,306,086,870 91,862,018 2,397,948,888 96.2 3.8 100 Philadelphia 5,250 5,250 147,266,062 3,080,170 150,346,232 98.0 2.0 100 Cleveland 19,529 19,529 131,256,830 15,287,322 146,544,152 89.6 10.4 100 Richmond 112,130 "*"243,6o6* 355,130 168,819,301 6,006,274 174,825,575 96.6 3.4 100 Atlanta 217,560 20,000 $4,591 242,151 82,345,796 1,597,563 $50,276 83,993,635 98.0 1.9 0.1 I0O Chicago 871,860 300,160 1,172,020 405,830,815 11,018,502 416,849,317 97.4 2.6 100 St. Louis 247,838 247,838 92,059,649 920,225 92,979,874 99.0 1.0 100 Minneapolis... 1,863,123 1,863,123 86,807,174 422,300 87,229,474 99.5 .5 100 Kansas City 1,708,043 1,708,043 58,748,043 59,615 58,807,658 99.9 .1 100 Dallas 1,804,892 1,804,892 67,580,221 714,214 fiS 294.425 99.0 1 0 100 San Francisco.. 1,949,291 30,000 1,979,291 91,817,614 12,688,471 ! 104,'506,'685 87.9 12.1 ! 100 Total 8,840,308 | 621,160 4,591 9,466,059 3,762,359,098 162,796,413 50,276 3,925,205,787 ! I Per cent 0.2 100.0 95.9 4 1 100 ! Maturities of discounts, acceptances, and municipal warrants held by each Federal Reserve Bank on Friday, Aug. 80, 1918. fin thousands of dollars; i. e., 000 omitted.] 1 to 15 days. 16to30davs. Banks. B oo il u ls n t d e i d s- . M wa u r n r i a c n ia ts p . 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! ! Ti o , t aL , Boston 32,033 5,637 37,670 7,519 3,540 11,050 New York i 459,513 17,622 477,135 19,939 40,668 60,607 Philadelphia, 53,710 2,002 55,712 3,989 1,637 5,626 Cleveland... 58,669 4.269 62,938 10,640 4,672 15,312 Richmond.. .! 42,225 1,484 43,709 2,574 1,417 3,991 Atlanta 37,401 919 38,320 2,317 731 3,048 Chicago -| 164,651 1,294 165,945 13,574 1,116 14,690 St. Louis... 38,819 113 38,932 5,280 127 5,407 Minneapolis 31,,511 31,591 3,353 85 3,438 Kansas City ! 25,646 25,646 5,073 5,073 Dallas....: i 25,363 335 25,698 1,659 54 1,713 San Francisco ! 40,224 3,994 44,218 7,931 4,205 12,136 Total j 1,009,765 | 37,749 1,047,514 83,848 58,252 142,100 Per cent I \ 63.1 8.6 31 to 60 days. 61 to 90 days. Banks. B co il u ls n t d e i d s- . 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- . j I wMaurnraicnitpsa l Total. bought. Boston 11,815 4082 j. 20,897 20, 10,487 ... 31,294 New York 28,351 798 |. 65,149 53, 26,787 ;.. 80,621 Philadelphia... 19,889 394 . 23,283 13, 2,729 :. 16,396 Cleveland 10,821 3, 22,684 9, 5,278 :., 15,098 Richmond 7,234 137 i! 8,371 6, 704 ... 7,083 Atlanta 6,589 704 41 7,334 3, 1,203 • 4,365 Chicago 13,036 7,452 20,488 19, 5,878 . 24,880 M St. i n L n o e u a i p s olis... 5 8 , , 1 5 2 6 4 2 85 4 6 0 5 8 , , 9 6 8 0 0 2 3 6 1 0 3 5 1 i. . . 1 ? 2 > ,9}6 4 66 8 Kansas City... 13,330 126 13,456 10 i. 9,864 Dallas 5,641 200 5,841 30 i. 6,409 San Francisco. 16,266 101 24,367 9,009 j 3,012 i. 12,021 Total. 146,658 79,753 I 41 226,452 167,791 I 56,849 \ 224,645 Percent 13.6 13.5 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1028 FEDERAL RESERVE BULLETIN. OCTOBER 1, 1918. Maturities of discounts, acceptances, and municipal warrants held by each Federal Reserve Bank on Friday, Aug. 30, 1918—Continued. [In thousands of dollars; i. e., 000 omitted.] Tstal. Percentages. Accept- Bills j Accept-1^0" ances dis- ancos | A1'" Total, bought. counted, bought, j ! , .; r ' a ; n(" t s | , j ..! Boston 23,745 ! 100..934 28. i xoo D S C A C M K S N P R t a h h l a i t e a . i e c n l i i l n w n a v c l l L h n a a s a n F e m o e a s d g Y l t r i a a s a e o a o n o n p l n C n s p r d o c k d h i l i t i , . s i y s a c . o i ; ! I ! ' ! 5 3 3 3 3 , , , , , 3 0 6 8 1 3 3 8 3 9 8 0 2 9 9 2 9 8 9 0 1 5 3 3 3, J , , 1 3 3 0 0 2 8 0 3 9 6 9 9 2 8 2 5 5 5 4 7 4 1 2 8 9 2 6 9 4 , . . , , , , 1 2 1 1 2 3 9 1 5 4 0 9 1 1 , , , , , , , 7 5 7 0 7 3 8 3 6 7 1 0 5 6 7 1 4 1 3 7 4 3 1 7 7 2 2 2 9 6 5 6 0 ! j ! 1 1 6 1 0 8 6 1 , 3, , , , . ; 0 2 8 ' 0 8 2 0 0 4 5 7 6 9 7 9 3 5 6 8 1 3 1 8 4 7 2 2 0 9 0 4 S4 2 1 2 7 9 . . . ! ' i 0.1 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 Total 20,133 21 20,151 1,428,195 232,603 Percent 1.2 11.0 . 100 Total investment operations of each Federal Reserve Bank during the months of August, 1918 and 1917. Bills dis- Bills bought in open market. Municipal warrants. counted for Federal Reserve Bank. member and s F er e v d e e r B al a n li k e s - . ac B ce a p n t k a e n r c s e ' s. c T e r p a t d a e n c a e c s - . Total. City. State. ot A h l e l r. Total. Boston §123,740,723 ! 818,741,399 §398,340 ! 319,139,739 New York 2,306,086,870 j 89,799,746 12,062,272 I 91,862,018 Philadelphia 147,266,062 ! 3,'080,170 3,080,170 Cleveland 131,256,830 : 14,868,573 ""V4is"749"| 15,287,322 Richmond 168,819,301 ! 6,006.274 6,006,274 Atlanta 82,345,796 i 1,597;563 1,597'563 S45,68o"| !...!.. " S4**59i' S50,276 Chicago 405,830,815 | 11,018,502 11,018,502 St. Lo'uis 92,059,649 920,225 920,225 Minneapolis 86,807,174 422,300 422,300 i Kansas City 58,748,043 59,615 59,615 i Dallas 67,580,221 I 714,214 714,214. I San Francisco 91,817,614 ! 7,787,865 ' 4,900, 606j 12,688,471 j Total, August, 1918., 3,762,359,098 j 155,016,446 7,779,967 j 162,796.413 45,685 !. 4,591 50,276 Total, August, 1917 220,939,974 j 67,510,898 4,611,904 1 72,122;802 125,938 j. 9,278 135,216 United States securities. Total investment operations. Federal Reserve Bank. United States \ 3 c £ e n p t e . r i c n c d rt e i b fi t c e a d te n s e s o s f . 1 j Total. 1918 19174 Boston §142,880,762 §34,008,633 New York... $29,285,000 29,285,000 12,427,233, 63,537,219 Philadelphia | j 150 20,000 20,150 i 150,366, 26,064,872 Cleveland '• | 25,200 20,000 45.200 146,589, 31,344,170 Richmond, 1,000 l'.OOO 174', 826, 31,303,845 Atlanta... 27,000 I 140,000 10,000 177,000 84,170; Chicago... 416,849, 26,317,759 St. Louis 92,979, 18,839,427 Minneapolis I I 92,000 82,500 174,500 87,403, 14,148,906 Kansas City ! ' 52,500 52,500 58,860, 22,323,333 Dallas .* j 369,900 750,500 I 1,120,400 69,414, 5,742,224 San Francisco 104,506, 14,514,168 Total, August, 1918 396,950 257,600 30,221,500 30,876,050 3,956,081,837 Total, August, 1917 • 1 3,825,460 ^3,825,460 297,023,452 1 Incudes $1,263,246 in foreign trade. 3 Includes 84,858,001 in foreign trade. * Includes 113,000 in foreign trade. * Exclusive of purchases of Treasury certificates of indebtedness. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER i, 1918. FEDERAL RESERVE BULLETIN. 1.029 Untied States securities held by each Federal Reserve Bank on Aug. 31, 1918, distributed by maturities. Other United States securities, including 1-year Treasury notes and United States bonds with circulation Treasury certificates of indebtedness available as security for Federal privilege. reserve bank notes under silver act of Apr. 23,1918. Federal Reserve ! ~ Banks. : 3 per cent I 3 per 3^ per 4 per 4* per U rited Total, 1-year I cent cent cent cent States cerj Tr n e o a t s e u s. r y ! ' 1 lo 9 a 6 n 1 o . l L lo i 1 b a 9 n e 4 7 r o t . f y 1 L 9 lo - i 1 a b 2 n e -1 r o 9 t - f y 17. L lo i 1 b a 9 n e 2 S r o t . ? y i i i j n id c e a b t' t j e s d o - i Boston 8750 $529,000 SI, 416,000 ! £383,900 $26,550 1,722 j |82,357,922 New York • : I il.255)400 i 1,476,000 : | 196,700 3,800 810.945,000 13,876,900 Philadelphia : 6100 i ! ' 549,200 1,181,000 ! ! 11,850 789)250 I 150 29,500 2.558,050 Cleveland ; 414,800 1,660,000 ; j 1,468.300 1 410.350 35.000 3,986,450 Richmond 915,100 237,000 1,285,000 : •12,850 37,750 j 500 225!000 2.743,200 Atlanta 240.600 21,000 ! ! 10,300 965,000 ; 40)000 273.350 I 35,300 2<\ 000 l', 611,550 Chicago 1,862)500 367,300 !Sl,7G8.000 ' 427,400 2,112,000 • S400 83,050 i 6,620,650 St. Louis : ' 100 ! '. : 1,153,300 321,000 ' 1,474,400 Minneapolis > j • 114,800 880,000 ; 500 1,045 ; 5, 000 1,021,605 Kansas Cil v i 7,155,850 22,240 ! 82-1,400 ! 838,500 1,168,000 ; I 21,900 8,100 76,000 10,114,990 Dallas....." ; 2,450,900 281,500 ! jl, 233'. 600 901,000 i ! 370,600 10,350 750,500 5,938,450 San Francisco 2,428,750 I 1,000,000 ; 1,000,000 ; | 5,200 27,150 20,000 4,481,100 Total ; 15,054,550 929,-100 | | 3,592,400 6,526,300 114,365,000 j 900 J2,539,300 1,246,000 459,4 ] 7 | 12,132,000 56,845,267 Total United States bonds with circulation privilege; 819,576,350. Other United States securities, >37,2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1080 FEDERAL RESERVE BULLETIN. OCTOBER 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 Aug. 30 to Sept. 20, 1918. RESOURCES. [In thousands of dollars; i. e., 000 omitted.] I New i 1'hila- Rich- St. Minne- Kansas San I York. Idelphia. mond. Louis. apolis. City. Dallas. Fran- i Total, cisco. ; Gold in vault and in transit: Aug. 30 3,598 289,110 268 22,823 6,179 6,782 26,577 1,416 8,226 207 6,951 11,872 j 384,009 Sept.6 2.819 287,998 279 22,866 6,161 6,829 26,761 1,200 8,222 353 6,962 12,778 j 383,228 Sept. 13 3;i63 288,712 290 25,010 6,198 6,881 26,651 1,411 8,259 207 7,043 12,389 ! 386,214 Sept, 20 3,423 272,357 186 24,898 6,294 6,712 26,345 1,223 8,177 182 7,041 10,822 i 367,660 Gold settlement fund, Federal Reserve Board: Aug. 30 76,874 73,052 53,030 68,372 29,919 19,578 89,643 30,216 12,667 30,060 8,833 28,682 i 520,926 Sept. 6 71,540 107,592 59,317 55,713 26,400 12,862 ! 64,45025,286 10,011 23,965 9,340 32,055 i 496,531 Sept. 13 77,965 43,235 62,016 69,052 27,003 13,776 63,299 21,694 22,463 20,662 4,327 39,806 ! 465,298 Sept. 20 68,050 41,391 69,605 64,220 26,392 7,783 77,541 22,430 13,115 21,932 7,257 40,281 459,997 Gold with foreign agencies: Aug. 30...:...: 408 2,011 525 204 175 816 233 233 291 204 321 5,829 Sept. 6 408 2,011 408 525 204 175 I 816 233 233 291 204 322 1 5,830 Sept. 13 408 2,011 408 525 204 175 1 816 233 233 291 204 321 ! 5,829 Sept.20 408 2,011 408 525 204 175 • 816 233 233 291 204 321 ; Gold vvith Federal Reserve agents: ! ! Aug. 30 | 59,953 297,613 112,195 135,052 39.091 21,769 ! 168,013 51,7191 2'?, 751 52,643 13,862 86,936 ! 1,061,397 Sept.6 59,705 297,165 111,795 134,576 41,439 25,480 179,225 51,720 22,737 57,643: 14,348 91,927 I 1,087,760 Sept. 13 | 59,450 297,165 110,466 ,! 134. ,306 43,439 31,173 1191,244 56,668; 25,604 57,562 i 2-1,319 91,736 i 1,123,132 Sept.20 | 59,242 286,910 111111,111111 1|114444,O02244 | 45,369 40,518 |197,659 56,668 27,516 57,562. I 24; 319 95,052 1,145,950 Gold redemption fund: 'I ' Aug. 30 ; 4,199 14,955 5,000 : 1,478 846 2,456 i 4,632 2,602 2,499 1,159 I 1,546 61 41,433 Sept. 6. 4,446 14,955 5,000 i1,560 794 3,684 ! 4,9192,592; 2,620 1,157 i 1,846 61 43,634 Sept. 13 4,599 15,000 5,000 ! 812 727 3,953 j 5,1622,588: 2,716 1,148 i 2,146 235 ! 44,086 Sept.20 4,812 15,000 5,000 !1,023 692 3,121 ! 5,356 2,579: 2,833 1,142 ! 2,146 418 i 44,122 Total goid reserves: j Aug. 30 |145,032 676,741 1170,901 J228,25O 76,239 10,760 j289,681 j 86,186 ; 46,376 84,360 I 31,396127,872 1 2,013,794 Sept.6 1138,918 i 709,721 il76,799 213,240 74,998 49,030 |276,171 81,031 j 43; 82383,409 ! 32,700137,143 I 2,016,983 Sept. 13 1145,585 | 646,123 178,180 229,705 77,571 55,958 287,172 82,594 i 59,275 79,870 I 38,039144,487 2,024,559 Sept.20.. 1135,935 617,669 186,310 234,690 | 78,951 58,309 307,717 83,133 j 51,874 81,109 I 40,967146,894 2,023,558 Legal tender notes, silver, etc.: ! Aug. 30 | 2,371 45,175 784 310 847 317 1,448 425 ! 56 251 ! 964 220 ! 53,168 Sept. 6 ! 2,074 45,705 395 864 164 1,430 798 j 74 291 j 635 214 ! 53,511 -Sept. 13 i 2,315 45,358 910 327 805 162 1,707 471 ! 75 246 I 622 175 ! 53,173 Sept. 20 ! 2,616 44,808 873 293 614 159 1,707 400 ! 54 272 ! 516 169 I 52,481 Total cash reserves: Aug. 30. 147,403 721,916 171,685 (228,560 77,086 51,077 1291,129 86,611 46,432 84,611 32,360 128,092 i 2,066,962 Sept. 3 1140,992 775555,442266 177,666 1213,635 75,862 49,194 1277,601 81,829 43,897 83,700 33,335 137,357 ! 2,070,494 Sept. 1;) Ii47 900 691,481 179,090 1230,032 78,376 56,120 i288,879 83,065 59.350 80,116 38,661 144,662 ! 2,077,732 Sept .20 !i38,551 662,477 ;187,183 |234,983 79,565 58,'468 J309* 424 j 83,'53351,928 81,381 41,483 147,063 ! 2,076,039 Bills discounted: I Secured by Government yrar obligations— Aug. 30 51,439 415,221 65,452 43,875 41,587 26,783 120,533 32,712 24,767 16,909 24,729 32,326 896,333 Sept.6-... 62,611 453,900 70,280 52,564 45,187 31,314 146,992 36,481 25,774 17,595 23,906 40,877 1,007,481 Sept. 13 651887 487,811 70,745 54,295 51,048 36,024 151,361 38,877 25,911 23,820 24,435 41,251 1,071,465 Sept.20 67,555 524,966 80,609 54; 158 47,726 39,650 1157,717 44,763 25,873 29,108 28,504 45,728 j 1,146,357 All other— Aug. 30 20,749 146,418 25,818 1 46,117 17,055 23,073 I 93,619 19,881 35,174 42,026 17,702 44,230 531,862 Sept.6 19,374 130,199 29,413 44,983 19,020 23,728 i 97,367 24,306 39,071 39,742 21,666 45,654 534,493 Sept. 13 17,617 134,034 26,583 I 40,644 17,656 25,807 j 92,500 24,942 51,457 41,243 21,924 47,375 541,782 Sept.20 16,504 132,421 21,030 j 36,775 18,100 28,125 80,792 23,455 44,985 42,078 23,085 46,439 513,789 Bills bought in open market: Aug. 30 28,746 121,875 9,762 I 26,077 4,742 3,557 15,740 1,701 336 136 619 19,312 232,603 Sept.6 29,353 120,762 8,856 I 27,653 4,649 3,436 16,549 1,619 259 136 554 19,915 233,741 Sept. 13 29,821 123,016 9,693 i 29.476 4,548 3,702 16,393 1,600 262 136 634 20,469 239,750 Sept.20 29,311 131,978 9,044 ! 30,100 4,600 4,622 17,211 1,829 142 136 695 20,364 250,032 United States Government long-term securities: Aug. 30 942 1,452 1,348 2,292 1,233 620 4,509 1,153 122 8,871 4,347 3,461 30,350 Sept. 6 742 1,450 1,347 2,292 1,233 620 4,508 1,154 116 8,868 3; 977 3,461 29,768 Sept. 13 538 1,449 1,348 2,292 1,233 621 4,50S | 1.153 116 8,867 3,977 3,461 29,563 Sept.20 538 1,448 1,348 1,791 1,233 581 4,509j 1,153 116 8,867 3,977 3,461 29,022 United States Government short-term securities: Aug.30 1,416 12,438 1,211 1,695 1,510 991 2,112 321 912 1,244 902 1,020 25,772 Sept.6.. 1,416 13,881 1,211 1,725 1,510 991 2,112 321 940 1,269 1,651 1,003 28,030 Sept. 13.. 1)416 18,330 2,410 1,725 1,510 991 2,112 321 984 1,324 1,651 1,003 33,777 Sept. 20.. I 1,416 22,279 3,220 2,760 1,510 991 4,112 1,321 1,035 1,324 902 1,008 41,878 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBEB 1, 1918. FEDERAL RESERVE BULLETIN. 1031 Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve system at close of business on Fridays Aug. 30 to Sept. 20,1918.—Continued. RESOURCES—Continued. [In thousands of dollars; i. e., 000 omitted.] Boston. Y N o ew rk - . j | d P el h p i h la ia - . C la le n v d e . - m R o ic n h d - . Atlanta Chicago Lo S u t. i s, M ap i o nn li e s - . i K Ci a t n y s . as Dallas. c F S i r s a a c n n o - . Total. All other earning assets: ! Aug. 30 i 67 67 Sept. 6 ! 67 : 75 Sept. 13 ! 70 i 11 81 Sept. 20 i 18 84 Total earning assets: i Aug. 30 103,292 697,404 103,591 120,056 66,127 55,091 236,513 55,768 61,311 69,186 48,299 100,349 1,716,987 Sept. 6 113,496 720,192 111,107 129,217 71,599 I 60,156 267,528 63,906 66,130 67,610 51,754 110,918 1,833,613 Sept. 13 115,279 764,640 110,779 128,432 75,995 67,215 1266,874 66,893 78,730 75,390 52,621 113,570 1,916,418 Sept. 20 115,324 813,092 115,251 125,584 73,169 74.035 1264,341 72,521 72,151 81,513 57,163 117.018 1,981,162 Uncollected items (deduct from | gross deposits): j Aug. 30 | 38,683 162,779 53,084 46,805 38,311 ! 26,064 | 60,247 40,328 11,650 45,441 20,071 25,192 568,655 Sept. 6 43,491 172,017 j 64,461 55,102 40,713 | 31,661 i 76,474 41,854 14,373 53,514 22,792 25,925 642,377 Sept. 13 ! 56,185 170,440 i 64,760 50,042 48,063 I 32,217 83,516 42,601 17,960 52,697 24,173 54,571 697,225 Sept. 20 ! 49,198 168,918 ! 60,977 47,845 47,142 ! 30,338 77,353 55,163 15,614 52,610 19,530 30,155 654,843 5 per cent redemption fund against Federal Reserve Bank Aug. 30 274 | 50 19 ! 200 400 137 84 1,164 Sept. 6 424 ! 50 18 i 200 400 137 84 1,313 Sept. 13 424 ' 100 18 ! 200 391 137 84 1,405 Sept. 20 924 ] 150 42 48 ! 280 10 402 138 84 2,112 All other resources: Aug. 30 1,939 I 1,558 631 1,049 764 : 1,262 624 215 ! 904 710 1,292 11,787 Sept.6 1,973 ! 1,665 597 828 757 i 1,565 561 202 918 779 1,382 12,076 Sept. 13 2,033 . 2,153 617 716 776 ' 1,279 538 213 i 912 1,074 1,851 13,013 Sept. 20 ; 2,023 i 1,452 673 895 794 1,429 542 211 | 908 1,622 1,176 12,610 Total resources: Aug. 30 290,217 1,584,312 1329,968 396,052 182,573 133,015 .589,351 183,331 119,608 1200,542 101,577 255,009 4,365,555 Sept.6 298,828 1,650,032 1354,949 398,551 189,002 141,786 j 623,368188,150 124,602 206,142 108,797 275,666 4,559,873 Sept. 13 !320,236 1,629,018 !356,882 409,153 203,150 j 156,346 ! 640,748193,097 156,253 209,506 116,666 314,738 4,705,793 Sept. 20 |303,992 1,647,434 1365,013 409,127 200,771 163,683 i 652,827211,769 139,904 211,814 119,936 295,496 4,726,766 LIABILITIES. I Capital paid in: Aug. 30 6,510 20,092 7,302 8,746 3,921 3,126 10,760 3,687 2,879 3,580 3,052 4,513 78,168 Sept. 6 6,510 20,109 7,334 8,751 3,948 3,137 10,796 3,721 2,883 3,590 3,059 4,521 78,359 Sept. 13 6,555 20,162 7,351 8,756 3,978 3,140 10,811 3,731 2,888 3,597 3,063 4,521 78,553 Sept. 20 6,557 20,173 7,351 8,768 3,9S8 3,142 10,890 3,731 2,890 3,600 3,076 4,523 78,689 Surplus: Aug. 30 75 116 40 216 38 1,134 Sept. 6 75 649 116 40 216 38 1,134 Sept. 13 75 649 116 40 216 38 1,134 Sept. 20 75 649 •I- 116 40 216 1,134 Government deposits: Aug. 30 13,070 28,582 5,227 ! 9,036 6,527 4,697 7,463 6,354 3,136 6,163 7,933 6,241 104,729 Sept. 6 25,259 31,789 16,928 j 20,979 6,138 8,011 33,839 9,158 8,946 11,890 6,281 18,104 197,325 Sept. 13 25,975 21,487 14,459 ! 19,182 9,746 6,898 26,018 9,696 35,354 7,564 8,799 j 21,555 206,733 Sept. 20 17,391 18 792 15,682 i 15,996 7,330 10,083 24,748 12,017 12,242 7,145 10,129 | 17,056 169,141 Due to members—reserve account: * Aug. 30 91,311 640,700 87,618 119,977 45,946 38,808 '200,885 52,659 35,639 ! 69,048 30,917 i 67,131 1,478,639 90,751 661,057 92,549 110,500 47,152 34,510 1194,153 50,724 36,129 I 60,632 31,659 55,286 1,465,102 Sept. 13 91,283 633,944 85,655 116,843 46,259 38,755 1197,814 53,537 39,923 | 66,851 32,282 66,442 1,469,603 Sept. 20 94,972 677,909 89,047 107,351 45,442 34,112 |201,018 54,020 41,424 i 70,865 35,502 72,866 1,524,528 Collection items: Aug. 30 , 40,148 104,636 42,738 50,271 32,290 22,035 44,244 34,321 14,497 23,964 12,617 16,124 437,885 Sept. 6 31,988 123,988 45,570 43,222 33,409 21,738 47,086 35,396 9, S97 29,538 13,624 26,124 461,640 Sept. 13 49,323 134,280 51,823 ; 42,200 41,050 21,349 | 57,433 31,428 8,832 28,731 15,434 45,869 527,752 Sept. 20 36,307 116,804 53,522 j 52,502 40,258 22,723 ! 56,475 42,797 9,587 29,188 10,818 19,284 490,265 Other deposits, including foreign government credits: Aug. 30 114,896 160 14 2,091 169 22 2,948 120,300 Sept. 6 , 116,831 184 1(58 2,5 2,724 119,960 Sept. 13 111,289 210 15 1,300 476 18 1,994 115,302 Sept. 20 , 95,974 222 30 1,456 207 26 2,258 100,173 Total gross deposits: Aug. 30 144,529 888,814 ! 135.583 1179,444 84,763 63,554 254,683 93,503 53,594 99,175 51,467 92,444 2,141,553 Sept.6 147,998 933,665 il55;047 J174,885 86,759 64,237 275,078 95,446 54,997 102,060 51,567 102,238 2,244,027 Sept. 13 166,581 901,000 :151,947 178,435 ! 97,055 67,017 282,565 95,137 84,132 103,146 50,515 135,860 2,319,390 Sept. 20 148,670 909,479 |158,251 176,071 93,030 66,948 283,697 109,071 63,279 107,698 56,449 111,464 2,284,107 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1032 FEDERAL RESERVE BULLETIN. OCTOBER 1, 1918. Resources and liabilities of each Federal Reserve Bant and of the Federal Reserve system at close of business on Fridays, Aug. 30 to Sept. 20, 1918.— Continued. LIABILITIES—Continued. [In thousands of dollars; i. e., 000 omitted.] Ncv,- Clove- j Rich- San "Boston.; York. •dciohia. land. mond. Dallas. Fran- rota!. cisco. federal Reserve iiot-cs ir, actual circulation: Aug. 30 •136,817 ! 659.766 185,243 i20f>. 501 92.316 I 65,345 314,806 ; 8-1,938 . 61,939 i 87,997 43,304 154,666 2.092.708 Sept. 6 iMi, 340 ; 678)298 1190,452 i212)398 96)678 | 73.303 328,297 ! 87)705 ! 65,410 I 90,500 50,384 105,411 2!180)679 Sept. 13 I Mi, 288 i 683,399 1195,109 ;219'. 108 LOO, 450 i 85)078 J337,548 ; 92.866 67.772 ! 92,850 53,223 170,738 2;245,429 Sept. 20 :j: 1•4"))576 ! 693,083 [196,028 |22l)084 102,003 •• 92,294 i347.805 37)294 I 72'. 267 ! 95,386: 56,398 175,813 2) 295! 031 Federal Reserve bank notes in ! circulation—net liability: ! Aug. 30 1 3,179 J 311 1.10_ 4,881 : ' ! 7,820 2,696 1.660 20,687 Sept. 6 5,892 i 547 204 1.5599 I 4,767 ' I ! 7,998 2,717 l)(>80 : 23,964 Sept. 13 272 8,364 j 831 458 1.;59 ! 5,236 i 52 ! ! 7,869 2,751 1,680 ; 27,672 Sept. 20.. 608 11)244 | 1,640 7(59 2'8«8« ' 5,685 I 320 i 39 i 8,023 2,872 16R*) 33,208 All other liabilities: Aug. 30 i 2.286 11, 812 : 1.499 2,271 1.457 ! 840 4,005 : 1,223 ! 1,1581,970 1,058 1,72(5 31,305 • Sent. 6 i 2,405 11, 419 I I:569 2,313 1)501 I 860 4,214 i 1,278 i 1)274 1)994 1,070 1,813 ; 31,710 Sept. 13 1 2,465 12,444 : 614 2,396 1,551 ! 912 4,372 ! 1,311 ' 1,4232,044 1,114 1)939 • 33,615 Scot.20 i 2,506 12,806 ! i,743 2,435 1,594 ! 971 4,531 ! 1,353 1,391 2,107 1,141 2,016 34,597 Totai liabilities: : Aug. 30 ,290,217 !l,584,312 :329, 968 I.39R, 052 182,573 1133,015 589,351 183,331 1119,608 200,542 101,577 255,009 : 4,365,555 Sept. 6 1208,82811,650!032 -.354,949 398,551 189)002 ; 141.786 623,368 1188.150 1124,602 206,142 108,797 275,666 4,559,873 Sept. 13 1320,236'1,629!018 J355,882 1409,353 203,150 il56)346 640,748 j 193) 097 156,253209,506 116,666 314,738 .4.705,783 Sept. 20 |3()3.992 !:IO9,127 200,771 1163,683 652,827 !2.1 J,769 139,904216,814 119,936 295,496 : 4) 726) yfiri Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTO.SEtt 1, 1918. FEDERAL RESERVE BULLETIK. 1033 FEDERAL RESERVE NOTES. Federal Reserve note account of each Federal Reserve Bank, at close of business on Fridays, Aug. 30 to Sept. 20, 1918. [In thousands of dollars; i. e., 000 omitted.] _Nov.- delphia. C la l n ev d e . - m R o ic n h d - . : Louis. M ap i o n l n i e s. - City." Dallas. C "F S is r a a c n n o - . i \ . Total. Fedora! Reserve notes received ; ! from agent—not: I '< Aug. 30 141,743 ! 705,941 198,283 216,232 96,889 68,245 333,188 91,451 62,677 93,823 43,626 166.840 2,218.938 Sept. 6 1145,949 ! 742,293 200,583 222,656 103,164 76,452 344,400 94,666 66,313 94,868 51,037 177', 391 2,319;772 Sept. 13 149,073 ! 747,038 207,053 228,786 104,631 87,1S4 356,419 99,990 89,460 98,359 53,917 186,940 2,388,845 Sept. 20 1149,365 i 760,576 210,938 235,104 110,499 95,509 362,834 102,985 73,552 100,955 57,121 186,756 2,440,194 Federal Reserve notes held bv ! ; bank: i I Aug. 30 ! 4,926 ! 46,175 13,040 10,641 4,573 2,900 18,382 8,533 738 5,826 322 12,174 126,230 Sept.6 4,109 i 63,995 10,131 10,258 6,486 3,149 16,103 6,961 903 4,368 653 11,977 139,093 Sept. 13 4,785! 60,634 11,944 9,678 4,181 2,106 18,871 7,124 1,688 5,509 694 16,620 143,434 Sept. 20 ! 3,789 • 67,493 14,910 14,020 8,498 3,215 15,029 5,691 1,285 5,569 723 10,943 151,163 Federal Reserve notes in actual j j circulation: i ! Aug. 30 1136,817 j 659,766 185,243 205,591 92,316 65,345 314,806 84,918 61,939 87,997 43,304 154,666 2,092,708 Sept.6 ...14.1,840 678,298 190,452 212,398 96,678 73,303 328,297 87,705 65,410 90,500 50,384 165,414 2,380.679 Sept. 13 ; 144,288 686,399 95,109 219,108 .1.00,450 85,078 337,548 92,886 67,772 92,850 53,223 170,738 2,245;429 Sept. 20 j 145,576 693,083 196,028 22!., 084 102,003 92,294 347,805 97,294 72,267 95,380 58,398 175,813 2,295,081 Gold.clcposited with or to credit I of Federal Reserve agent: i Aug. 30. '• 59,953 297,613 112,195 135,052 39,091 21,769 168,013 51,719 22,751 52.643 13,882 86,936 1,061,597 Sept.6 i 59.705 297,165 111,795 134,576 41,439 25,480 179.225 5.1,720 22,737 57; 6-13 14,348 91.9.27 1,08?; 7G0 Sept. 13 1 59,450 297,165 110.466 134.306 43,439 31,173 191,244 58,668 25,604 57,562 24,319 91', 736 1,123,132 Sept. 20 : 59,242 286,910 111,111 144,024 45,369 40,518 197,659 56', 668 27,516 j 57,562 24,319 95,052 1,145,950 Paper delivered to Federal Re- j serve agent: I • Aug. 30 ; iOO, 934 683,514 89,145 115,581 !1 62,409 46,888 229,256 48,317 54,202 59,07.1 43,050 81.447 1,613,814 Sept. 6 '111,338 704,861 98,538 124,574 j 66,014 51,333 280,908 48,385 57,434 57,473 46,126 92;950 1,719,854 Sept. 13 i 113.324 I 744,881 102,022 122,146 1 69.720 56, 090 280,254 54,853 88,867 65,199 46,993 93,411 1,797,546 Sept. 20 ill3;370 1 789,365 104,0(11! 119,385 69! 306 SI, 105 255,720 1 62,138 04,490 71,322 52,284 99,441 1,864,987 i Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1034 FEDERAL RESERVE BULLETIN. OCTOBER 1,1918. Federal Reserve note account of each Federal Reserve agent at close of business on Fridays, Aug. 30 to Sept. 20, 1918. [In thousands of dollars; i. e., 000 omitted.] ! San Boston. Y N o e r w k. i i C la le n v d e , - j I m R o ic n h d - . la A n t t - a. Lo S u t. is. ; ! M ap i o n l n i e s. - K C a i n t s y a . s Dallas. F ci r s a c n o - . Total. FEDERAL EESERVE NOTES. ' Received from Comptroller: | Aug. 30 1195,940 1,061,880 250,240 1258,740 1132,120 ! 115,860 402,420 117,880 i 84.080 121,700 71,420 180,200 2,995,480 Sept. 6 1198,140 1,078,080 251,940 |261,220 J136.920 !l20,860 414,740 122,500 : 84)080 123,700 74,340 190,760 3,057,280 Sept. 13 j205,54011,093,080 263,540 1269.840 1141,120 ! 132,460423,680 124,900 ! 90,080 125,700 82,640 200,500 3,153,080 Sept. 20 210.300 jl, 108,280 267,780 127i. 0-10 i 147,280 '148,340 138,440 127,800 j 93.080 ! 129.700 86,860 200,500 3,229,400 Returned to Comptroller: Aug. 30 37,597 243,139 45,837 I 22,568 28,331 21,865 27.892 20,629 ! 16.083 , 20,857 17,874 13,360 516,032 Sept. 6 38,391 243,587 46,237 j 23,044 28,656 ! 22.203 28,620 21,274 i 16)097 ! 21,112 17,978 13.369 520,568 Sept. 13 39,267 251,047 47,567 23.314 28,989 I 22,411 29,361 21,770 l 16,310 ! 21,321 18,153 13)560 533,070 Sept. 20 39,975 255,904 47,922 i 23,596 29,541 j 22,566 30,346 22,415 ! 16.398 i 21,425 18,294 13.744 542.126 Chargeable to Federal Reserve agent: j Aug. 30 ,158,343 821,741 204.403 1236,172 103,789 93.995 1374,528 97,251 I 67,997 • 100,843 53,546 166,840 2,479,448 Sept. 6 1159,749 834,493 205' 703 '238,176 108,264 ! 98; 657 1386,120 101,226 i 67,983 ,102,588 56,362 177,391 2,536,712 Sept. 13 166,273 842,033 215,973 '246,526 112,131 i 110.049 394,319103,130 ! 73,770 ,104,379 64,487 186,940 2,620,010 Sept. 20 170,323 852.376 219,858 1247,444 117,739 i 125)774 1108,094105,385 i 76,682 108,275 68,560 186,756 2,687,274 In hands of Federal Reserve i ! aggent: AAug. 30 16,600 115,800 6.120 19.940 6,900 25,750 41,340 5.800 ! 5,320 j 7,020 9,920 260,510 Sepp.t . 6 13,800 92,200 5,120 15,520 5,100 22,205 41,720 6)560 : 1,670 ! 7,720 5,325 216,940 SS ep tt. 13 i 17,200 95,000 8,920 17,740 j 7,500 22,865 37,900 3,140 . 4,310 ! 6,020 10,570 231,165 Sept. 20 ! 20,960 91,800 8.920 12.340 7,240 30,265 45,260 2.400 i 3,130 i 7,320 11,445 241,080 Issued to Federal Reserve i Bank, less amount returned j to Federal Reserve agent for j | redemption: : i Aug? 30 il41,743 705,941 216,232 96,889 68,245 333,188 91,451 i 62,677 93,823 43,626 166,840 2,218,938 Sept. 6 J145,949 742,293 200,583 222,650 103,164 76,452 344,400 94,666 ! 66.313 94,868 51,037 177,391 2,319,772 Sept. 13 ; 149,073 747,038 207,053 228,786 104,631 87,184 350,419 99,990 I 69)460 98,359 53,917 186,940 2,388,845 S e pt. 20 149,365. 760,576 210,938 235,104 110,499 95,509 362,834 102,985 | 73,552100,955 57.121 186,756 2,446,194 Collateral held as security for ! outstanding notes: J I Gold coin and certificates j on hand— i Aug.30 j 5.000 163,710 23,812 2,504 i 13,102 11,081 219,239 Sept. 6 ' 5', 000 163,740 2-3,813 2,504 i 13,102 11,081 219,240 Sept. 13 i 5,000 163,740 21,813 2,504 i 13,102 11,081 217,240 Sept. 20 1 5,000 163,740 21,813 2,504 | 13,102 11,081 217,240 In gold redemption fund— j Aug.30 | 7,453 13,873 9,996 11,240 1,591 1,445 . 57 2,589 1.349 2,283 2,097 7,735 | 61,708 Sept.6 ! 7,205 13,425 9,874 10.763 1,439 2,106 i 362 2,589 i 1)335 2,283 2,583 7.726 • 61.690 Sept. 13 i 8,450 13,425 10,874 12,493 1,439 1,899 i 478 3,037 i 1,202 2,202 2,754 7.535 65,788 Sept. 20 i 8.242 13,170 10,874 12,211 1,369 2,744 i2.240 3,037 1,114 2,202 3,054 10,351 70,60S Gold settlement fund, Fed- i oral Reserve Board— i Aug.30 i 47,500 120,000 102,199 100,000 37,500 17,820 167,956 j 49,130! 8,300 50,360 684 79,201 780,650 Sept. 6 i 47,500 120,000 101,921 100.000 40.000 20,870 '178,863 j 49,131 8,300 55,360 684 84,201 806,830 Sept. 13 i 46,000 120,000 99,592 100,000 42)000 26,770 190,766 53,631 i11,300 55,360 10,484 84,201 840,104 Sept. 20 ! 46,000 110,000 100,237 110,000 44,000 35,270 1195,419 53,631 13,300 55,360 10.184 84,701 858,102 Eligible paper (minimum j required) l — I Aug.30 i 81,790 40S, 328 S6,088 81,180 J 57,798 46,476 165,175 I 39,732 : 39.92641, ISO 29,764 79,904 ! 1,157,341 Sept. 6 i 86,244 445,128 88,788 ! 88,080 ; 61,72550,972 165,175 42,916 i 43,576 37,225 36,689 85,464 | 1,232,012 Sept. 13 i 89,623 449,868 96,587 94,480 ! 61,19256,011 165,175 43,322 . 43,856 40,797 29,598 95,204 ! 1,265,713 Sept. 20 ! 90.123 473,666 I "9"9 )—8-27 91080 j 05,130 54,991 :165,175 46.317 ! 46,03643,393 32,802 91,704 ] 1,300,244 i For actual amounts see item "Paper delivered to Federal Reserve agents," on p. 1033. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDEEAL BESEEVE BULLETIN. 1035 MEMBER BANK CONDITION STATEMENT. Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as ai dose of business on Fridays, from Aug. 23 to Sept. 13, 1918. I. TOTAL FOR ALL REPORTING BANKS. [In thousands of dollars; i. e., 000 omitted.] Boston.1 Y N o e r w k. P d li e i l l - apiiia. Number of reporting banks: Aug. 23 42 ! 102 50 = 85 . 77 45 ; Aug. 30 j 42 i 102 : 50 i 85 ! 77 ! 45 ; Sept. 6 1 42 i 102 i 49 i 85 i 77 | 45 : Sept. 13 ' 42 ! 102 i 51 i 85 i 77 i 45 ! United States bonds to se- j | cure circulation: i : Aug. 23 i 14,371 i 50,154 12,770 ! 42,131 '' 24,521 " 15,465 : 18,822 ! 17,070 267.879 Aug. 30 i 14,361 : 50,172 12,770 : 42,209 : 24,331 ' 15,667 \ 18,408 j 17,408 207,539 Sept. 6 1 14,352 | 50,222 11,492 ' 42,410 ! 24,251 \ 15,465 i 18,407 .' 17,414 266,599 Sept. 13 • 14,352 \ 50,503 11,492 ' 42,410 ! 24,251 . 15,465 i 18461 ! 17676 267,331 Other 'Urnted States bonds, j including Liberty bonds: Aug. 23 12,405 226,264! 29,118 ' 52,219 !30,292 • 23,051 !65,011 i 18,049 526,864 Aug. 30 12,092 234,009 | 28,277 i 47,996 2!8,301 I 22,304 !56,368 I 16.090 514,979 Sept. 6 11,802 220,250 | 28,749 ' 50,111 |27,944 i 22,548 i53,904 ! 14;740 496,028 Sept. 13 11,881 217,911 : 20,742 : 46,077 2i7,592 i 21,427 ;49,570 i 14,470 480,166 United States certificates of ! indebtedness: Aug. 23. 51,271 I 481,062 1 50,030 : 70,539 26,900 ! 27,197 j 107,769 ! 28,973 18,547 I 31,449 ! 14,512 51,055 I959,304 Aug. 30 i 49,084• ! 460.753 ! 48,457 i 70,573 27,658 i 27,222 j 106,734 I 27,666 18,412 I 30,547 I 14,428 ! 49,580 ! 931,114 S S e e p pt t . . 6 1 3 | 7 7 1 5, , 2 9 6 7 2 3 j 581, j 5 ( 9 2i 1 \.j | 6 5 1 9 , , 3 4 8 4 7 2 ! 8 8 8 7 , , 3 4 6 1 9 1 3 3 2 3 , , 5 8 8 8 4 4 ! j 3 3 4 3, , 9 0 8 5 0 1 ! j 1 13 3 2 4 , , 4 4 1 0 1 2 j ; 3 3 5 5 , . 1 1 6 1 8 7 2 2 1 1 , , 6 5 1 6 7 7 I 3 3 8 8 , , 2 6 4 5 4 6 ! j 1 1 6 6 , , 4 9 3 2 5 5 ! ! 63 6 , 2 7 , 7 2 3 631 1, , 1 2 7 0 6 3 , , 7 5 3 0 0 3 Total United States securities j i i : ; ! owned: \ : Aug. 23 1 78,047 i 757,480 j 91,918 1164,889 j 81,713 j 65,713 I191,602 i 64,092 37,287 j 61,445 ! 47,415 112,4461,754,047 Aug. 30 ! 75,537 744,934j 89,504 ,160,778 i 80,290 '• 65,1931 I81,510 ! 61",164 36,171 ! 59,813 j 47,045 111,6931,713,632 Sept.6 1101,476 874,193 1101,628 j 180,890 | 84,779 ! 72,064206,833 i 67,322 38,518 I 65,793 j 49,537 1123,0971,966,130 Sept. 13 j 98,206 850,005 97,676 !l75,898 j 85,727 i 70,872 200,442 ! 67,263 38,299 ! 65,699 J 49,650 1124,4901,924,227 Loans secured by United : m States bonds and certifl- ! cates: i Aug. 23 i 39,891 219,889 44,040 ! 3,69, 955 • ,20,745 i683 ! 61,854 i13,182 i10,389 4,326 5,325 ! 9,233 i |473,512 Aug. 30 i 40,000 204,924 245 I 35,844 I 20,632 j ,802 ; 59,017 ;13,089 !11,442 4,326 5,144 ! 8,656 i 455,031 Sept.6 i 40,029 212,860 153 i 36,601 i 19,848 i 9,067 ! 60,899 I14,778 l12,221 4,396 5,204 '" 9,018 i 470,074 Sept. 13 | 39,164 214,312 473 i 36,707 ! 19,717 I 9,182 62,748 i14,904 ;11,821 4,656 5,057 j 8,395 i £473,136 O thcr loans and investments: I Aug. 23 ;770,650 4,379,941 474 1982,160 "366,922 1288.476 !l,434,308 :383,598|267,876 i465,081 1178,273 '532,933 110,657,692 Aug. 30 1766,71714,361,771 '609, 794 ;977,656 :357,86G =289'.746 11,421.425 '378,5-12275,535 '461,626 il78,062 :537,125 '10,615,868 Sept.6 762,252 ;4,303,899 1606, 284 1974, ,465 1373,, 094 289;; 335 !l, 414', 872!372,893:280,687 '466,250 178,210 '540,763 10,563,004 Sept. 13 ",748,12114,318,438 553366 11997744,558855 ,336666,441199 ''229988,962 11,434,523'375,439'286,033 ;467,347 .180,130 ;542; 5oo -.10,601,088 Total loans and investments: i Aug. 23 1888,588 5,357,310 1743,432 11,184,004i469,380 j361,872 jl, 687,764 j460,872 1315,552:530,852 J23l,013 !ti54,612 il2,S85,251 Aug. 30 '"882,254."5,311,629 1743,543 ; 1,174,278 458,791 .362,741 11,661,952 ,452,795,323,148 !525,675 230,251 '657,474 12,784,531 Sept. 6 |903,75715,390,952 •'753,065 '1,191,956 477,721 '370,466 11,682,604 :454,993 331,426 1536,439 1232,951 :(>72,878 12,999,208 Sept. 13 885,49115,380,755 1754,685 'l,187.190!47i,863 |379,016 11,697,713 1457.606 !336,153 1537,702 1234,837 J675.440 '32,998,451 Reserve with Federal Reserve Banks: i Aug. 23 1 64,145 613,978 i 52,892 80,030 30,727 27,410 ! 138,724 35,510 i 18,107 ; 44,839 j 14,771 ; 44,610 : 1,165,743 Aug. 30 | 64,742 663,815 | 5555,,331111 ! 8866,,550000 i 3300,,227755 i 2266,,552288 j 143,442 34,598 i 17,475 ! 48,830 j 14,834 ! 45,815 ' 1,232,163 Sept.6 j 63,782 635,973 !5 599,444477 i 883,182 , 3311,003333 i 3311,777799 | 130,857 32,701 I 17,720 40,075 15,130 ! 44,393 i 1,192,072 Sept. 13 | 67,036 601,047 57,869 ! 84,334 ! 29,785 •: 25.040 j 143,144 34,746 ' 19.189 45,293 16,017 i 43,059 1.166,565 Cash in vault: j Aug. 23 j 24,376 119,679 224 29,440 ; 15,998": 13,955 53,344 11,897 :8,121 15,377 10,601 , 19,881 342,893 Aug. 30 ! 22,930 115.336 617 ,2 9,,720 : 16,651 j 13,472 68,761 11,569 ;7,674 15,567 11,303 ! 19,836 I 351,236 Sept. 6 ! 24,920 118', 048 365 i "'3 4","1"3 7' 16 610 • •-•• 1 4~,~8-86 55,650 12,989 :9,026 15,443 12,002 ! 19,730 i 352,806 Sept.13 j 21)897 122,640 638 i 28.828 17,214i 14,190 59,402 11,340 j 7.945 17,631 11,772 i 22,110 ; 354.907 Net demand deposits on j which reserve is computed: Aug. 23 644,017 4,297,813'579, 239 |720,989 J295,68S i205,328 1,036,635i271,379 137.921 389,194 i 9,110,457 Aug. 30 654,927 4,352,7511584,633 733,552 313,736 |206,894 1,052,463!267,883 138,571 1383,440 i 9.230,897 Sept.6 1659.755 4,428,862 597,785 1715; 207 '298', 445 !206j289 1,,, 032,9771263,568 [160,434 1384,509 142,762 1394,372 ! 9'. 290.965 Sept. 13 i674^935 4,470,0561611,573 1721,956 304,779 i'210,609 1,070,113 !266,922 ,179; 787 |388,244 148,070 404,488 | 9'. 451'.532 Time deposits: I Aug. 23 i 96,953 269,825 14,261 1235,258 53,389 j 90,282 359,965 ! 75,575 45,367 63,738 24.579 116,090 I 1,445,282 Aug. 30 ! 97,882 269,982 14,311 1236,001 52,144 91,444 357,189 j 76,028 I 45,403 67,279 25;615 116,742 • 1,450,020 Sept.6 ! 97,273 271,167 13,930 1236,390 52,524. 92,017 358,441 | 73,995 ! 45,439 73,846 25,324 121.027 i 1,461.373 Sept. 13 i 97,131 269,325 16.521 1236,774 52,969 91,849 368,526 i 73,744 I 45,225 62,746 25,139 122'. 187 ! 1.462; 136 Total net deposits on which I reserve is computed: i Aug. 23 i682,07214,367,670 1584,354 794,748 314,070 1232,879 1,135,958 1291,075 (175,212 1392,552 1146,012 1424,021 j 9.540,621 Aug. 30 1693,299,4,422,787 .589,768 1807,550 331,755 |234,790 1,151,183 1287,694 |174,227 1404,399 146,968 1418,463 j 9,062,883 Sept.6 ,697,917 ,499,193 •1"6'"0*2 ,7—78 1789,315 316,611 1234,357 1,132,101 1282,841 182,854 1406,663 151,070 |430,680 9,726,380 Sept. 13 713,038 :, 539,966i J617,361 i'796,193 323,075 1238,621 1,171,608 1286,041196,145 '407,068 156,331 '441,144 ! 9,886,591 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1088 FEDERAL RESERVE BULLETIN. OCTOBEK 1, 1918. Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close oj business on Fridays, from Aug. 28 to Sept. 13, 1918—Continued, 1. TOTAL FOR ALL REPORTING BANKS—Continued. [In thousands of dollars; i. c, 000 omitted.] | Boston.' York. P p d h h e i l i - l a a . - C la le n v d e . - m R o ic n h d - . la A n t t - a. Chicago. Lo S u t. is.j j M ap i o n i 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. i — - "• "" — " " •" ~ T | GGV3i".nrnorit deposits: A ug. 23 68,230 i 365, 040 45,656 61615 19,040 17,700 82,380 25,393 ! 28,825 29,222 10,525 12,153 765,773 j^ug 30 46,963 : 'J57j 32,066 39? 14.426 ]3,822 57,913 15,761 i 26.045 21,678 i653 12,139 547,910 Sept. 6 56,215 ! 285, 100 35,371 61,794 17; 155 15.894 55,025 16,801! 29,704 23,162 555 12,009 615,785 Sept. 13 39,510 j 221, 657 22,795 53, 132 10,337 10,369 37,542 14,188 j 8,970 18,276 230 29 441,035 Ratio of combined reserve i and cash to total net de- i posits— Der cent: | Aug. 23 1 14.6 A -Lm' *5o | 15 5 S'r-r>r i'; . . 14.9 i 14.7 ! I 2. MEMBER BANKS IN CENTRAL RESERVE CITIES. CENTRAL SESEJIVE CITIES. ; Number of report!r.g baiVks: i Aug. 23..: ' ' 123 Aug. 30 !. 123 Sept. 6 !. 123 Sept. 13 j. 124 United States bonds to so- j cure circulation: • Aug. 23. ! 36,260 1,132, ), 970 47,362 Aug. 30 L 36,278 1,132 10,308 47,718 Sept. 6 36,328 ,132 10,314 47,774 Sept. 13. i 36,609 1,132 10,576 48,317 Other United States bonds, | including Liberty bonds: i Aug. 23 i 203,985 28,842 11,998 244,825 Aulr. 30 1 j 212,406 23,770 10,280 246,456 Sci) t. (> ! ! 199,445 21,200 9,073 229.718 Sept. 13 1 | 197,773 20,551 8,706 227'. 030 ¥nited Slates certificates of j indebtedness: j Aug. 23 i i 456,880 56,654 21,410 531,914 Aug. 30 J i 436,929 55,463 20,642 513,034 Seat. 6 ! j 574,985 71,084 26,805 672,874 Scp t. 13 j i 553,266 70,933 26,954 651,153 Total United States securi- i j ties owned: i | Aug. 23 i 697,125 86,628 43,378 I. 827,131 Aug. 30 685,613 80,365 41,230 . 807,208 SoDt. 6 810,758 93,416 46,192 |. 950,366 Sept. 13.... . | 787,648 92,616 46,236 j. 926,500 Loans secured by United ; States bonds and cortifi- | cates: I I Aug. 23 '• ! 198,817 44,412 ! 9,761 i* 252,990 Aug. 30 ; ! 184,052 42,070 i 9,986 i 236,108 Sept. 6 1 i 193,479 43,820 I 11,827 i 249,126 Sept. 13 ! ! 195,468 44,877 j 11,915 ! 252,260 Ottior loans and irivastments: i ! Aug. 23 ! '4,035,712 875,537 1280,619 = ' 5,191,868 Aug. 30 ; i4,016,821 863,431 j275,745 i 5,155,997 Sept. 6 i 3,956,509 856,753 270,117 I i 5,033,379 Sept. 13 i ..iS, 970,040 875,626 272,583 | 5,118,249 Total loans and in vestments: i i Aug. 23 ,4,931,654 ,006,577 i 333,758 \ 6,271,989 <\.ug. 30 !4,886,486 985,866 1328,961 j 6,199,313 Sept. 6 ! :4, 960,746 : ' 993,989 ,328,136 i 6,282,871 Sept. 13. 14,953/156 i i 1,013,119 [330,734 ! 6,297,009 Reserve with Federal lie- : ' ! serve Banks: ! : i Aug. 23 ! 588,019 ! i 96,914 27,553 712,488 Aug. 30 ! i 638,007 i 99,896 27,083 764,986 Sept. 6 j 611,230 ! i 93,438 25,618 730,286 Sept. 13 I ! 572,886 • : j 100,321 700,169 Cash in vault: j ! '• ; Aug. 23 , I 106,993 ! 31,664 5,960 144,617 Aug. 30 • i 103,379 32,330 5,774 141,483 S 3 e e p p t> t t. . G fe fe i ! -1! ! 1 1 0 0 9 4 ", , 9 3 8 "6 2 "4 '; 3 3 2 5 , , 4 4 6 0 7 7 ! 6 5 , , 0 7 4 3 5 5 1 15 4 0 3 , , 5 4 6 9 6 4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBER 1,1918. FEDERAL RESERVE BULLETIN. 1037 Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close of business on Fridays, from Aug. 23 to Sept. 13,1918—Continued. 2. MEMBER BANKS IN CENTRAL RESERVE CITIES—Continued. [In thousands of dollars; i. e., 000 omitted.] I Boston. Y N o e r w k. phia. I land. m R o ic n h d - . I ! la A n t t - a. Chicago. Lo S u t. is. M ap i o n l n i e s - . ; j K C a i n ty s . as Dallas. F c S i r s a a c n n o - . Total. Net demand deposits on • ; •' ! which reserve is computed: ': ' [ Aug. 23 3,992,146 ' '•• i 698,684 198,984 889,814 Aug.30 ! 14,050,583 : " I 704,313 195,806 |. .' I ! I 4,995510,702 S S e e p pt t . . 6 1 3 i ! 4 4 , , 1 1 5 2 6 7 , , 2 04 5 4 6 : = I ! 6 7 8 1 3 4 , , 0 4 6 0 6 5 1 1 9 8 2 9 , , 4 3 2 4 8 7 j | . :.::::r:::|:::::::j:::::::r9 0 99,457 Time deposits: • : ; : I Aug. 23 : 218,515 !- : ! 133,324 53,705 !. 405,544 Aug.30 ' i 217,843 ! !..J j 129,975 i54,,0 97| 401,915 Sept. 6 ' 218,277 i :, 129,617 :5533,008822 400,976 Sept. 13 ! 216,921 " ; • : 113399,007733 | 5544,114444 j 410,138 Total not deposits on which , • i reserve is computed: ' • ! • Aug. 23 14,042,573 i 729,451 211,377 ! : ! 4,983,401 A Se u p g t . . 3 6 0 ; : ' 1 4 4 ,1 ,1 7 0 7 0 , , 4 8 1 5 6 4 I ' : ' • 7 7 3 1 4 2 ,, , 7 9 3 7 0 8 7 ,; 2 2 0 0,9 1 8 , , 5 2 9 9 7 0 ! j '• ! I : 5 5 , , 0 0 4 9 3 1 , , 4 9 5 9 1 1 Sept. 13 .14,206,315 j. 746,499 1204,923 • , ; 5,157,737 Government deposits: Aug. 23...T. 336,569 !. 51,124 j 20,531 i i : 408,224 Aug. 30 237,075 !. 37,739 i 12,°™ ' j 287,713 Sept. 6 262,608 !. _,— . 13,751 i 310,291 Sept. 13 203,208 i. 24,828 ] 11,887 ! 239,923 Ratio of combined reserve and cash to total net deposits—percent: Aug. ~~ 15.9 16.5 14.5 i 15.9 Aug. 30 | j 17.1 17.1 : 14.8 ! 17.0 Sept. 6 1 ' 16.1 16.9 14.7 ! 16.2 Sept. 13 ! ! 15,5 17.6 15.1 ! 15.8 3. MEMBER BANKS IN OTHER RESERVE CITIES. OTHER RESERVE CITIES. j I Number of reporting banks: I i Aug. 23 ! 19i 61! 45! oil 35; 446 Aug.30 1 " 191 61 451 51! 35 446 Sept. 6 | 19| 611 4455!j 52! 35 447 Sept. 13 i 19 38 61 i 39 52 i 35 449 United States bonds to secure ! circulation: | ! Aug. 23 4,287j 7,796 8,765 34,477) 14,147| 13,465 16,940i 5,330 3,440 13,772 15,476i 34,505 172,400 Aug.30 4,287 7,796 8,765 34,555' 13,957; 13,667 16,526! 5,330 3,440 13,710 15,1761 34,505 171,714 Sept. 6 4,278i 7,796 7,487 34,555! 13,9571 13,465 16,585: 5,330 3,440 13,710 15,476' 34,505 170,584 Sept. 13 1 4,278; 7,796 7,487 34,555' 13,957| 13,465 16,579; 5,330 3,440 13,930 15,476 34,480 170,773 Other "United States bonds, j ! including Liberty bonds: j Aug. 23 6,979| 7,730 23,976 45,528; 19,1361 22,319 34,592! 4,198 10,307 16,224 12,477 26,886 230,352 Aug. 30 6,669,1 7,568 23,196 41,4101 17,7531 21.735 30,985! 4,052 9,428 15,556 11,911 27,608 217,871 Sept. 6 ! 6,4561 6,812 23,797 43,785! 17,527! 21J982 31,202; 3,911 8,584 13,839 12,154 26,329 216,378 Sept. 13 6,532i 6,767| 22,523 40,275: 17,545 20,919! 27,468! 4,239 8,401 13,113 11,784 26,237 205,803 United States certificates of i indebtedness: ! Aug. 23 35,576! 10,951! 41,544. 63,994; 20,559 26,431 49,861i 5,244 11,537 31,449 12,814 51,055 361,015 Aug.30 33,759: 11.276J 40,141 64,077^ 21,041 26,44i; 49,997: 5,165 11,377 30,547 12,750 49,580 356,151 Sept. G 54,256: 12,884) 51,410 79,881, 25,058 33,130] 61,798! 6,491 12,000 38,244 14,637 62,263 452,052 Sept. 13 52,170: 12,367 49,424 78,763 26,108 33,099 59,938: 6,216 11,991 38,656 15,137 63,773 447,642 Total United States securities owned: Auer.23 46,842 26,477; 74,285 143,! 53,842 62,215 101,393: 14,772 25,284 61,445. 40,787 112,446! 763,767 Aug.30 44,715; 26,640 72,102' 140,042 52,751 61,843 97,508: 14,547 24,245 59,813 39,837 111,693 745,736 Sept. 6 64,990! 27,492 82,694; 158,221 56,542 68,577 109,585: 15; 732 24,024 65,793! 42,267 123,097' 839,014 Loan S s e pt s . e 1 cu 3 r ed by United 62,980 !: 26,930 79,434 153,593 57,610 67,483 103,985! 15,785 23,832 65,699j 42,397 124,490: 824,218 States bonds and certifi- : cates: i Aug. 23 31,901: 10,510: 42,269. 35,904! 17,453 7,620l 16,876; 2,255 9,987 4,326! 4,709 9,233 193,043 Aug. 30 32,0111 10,400: 42,492 34,7711 17,441 7,723 16,375! 2,416 11,099 4,236. 4,505 8,656j 192,125 Sept. 6 31,915: 9,031: 43,380! 35,541 i 17,002 8,998 16,490; 2,253 11,838 4,396 4,581 9,018! 194,503 Sept, 13 31,708j 8,789: 44,689 35,648 16,887 9,115 17; 304: 2,264 11,510 4,656! 4,443 8,395! 195,408 O ther loan s and investments: ; Aug. 23 546,906! 144,055: 545,585: 899,554 256,381 276,034 548,014; 81,346 204,976 465,081! 149,04 532,933; 4,649,912 Aug. 30 542,897! 144.404 540,974. 893,276 246,589 277,588 547,419 80,163 212,508 461,626; 149,115 537,125! 4,633,684 Sept. 6 536,851: 144; 128; 537,622; 889,661 262,845 277.196 547,755! 80,032; 217,449466,250; 148,584 540,7631 4,649,136 Sept. 13 533,411i 145,801; 542,237 890,646 258,672 286; 820) 548,200: 79,906! 221,156 467.347 149,350 542,555! 4,666,101 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1038 FEDERAL RESERVE BULLETIN. OCTOBER 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 Aug. 23 to Sept. 13, 1918—Continued. 3. MEMBER BANKS IN OTHER RFSERVE CITIES—Continued. [In thousands of dollars: i. e., 000 omitted.] Boston.! Y N o e r w k. P p d h h e i i l l - a a . - C la lo n v d e . - | | m R o ic n h d - . la A n t t - a. Lo S u t i . s M ap i o n l n i e s. - I K C a i n ty sa . s Dallas. F c S i r s a a c n n o - . Total. Total loans and investments: Aug. 23 625,649! 181,042 662,1391,079,457 327,676 345,869j 98,373 240,247!530,852 194,523 654,612i 5,606,722 Aug. 30 619,623! 181,444 655,5681,068,089 316,781 347,154 661,302 97,126 247,852!525,675 193,457 657,474! 5,571,545 Sept. 6 633,756: 180,651 663,6961,083,423 336,449 354,771 673,830 98,017 253,311i 536,439 195,432 672,878J 5,682,653 Sept. 13 181,520 666,3601,079,887 333,169 363,418| 97,955 256,498]537,702 196,190 675,440 5,685,727 Reserve with Federal Reserve Banks: I Aug. 23 51,046: 12,159 47,203 73,960 23,559 26,433; 41,007 6,218 14,062i 44,839 12,732 44,610 397,828 Aug. 30 51,985; 13,271 49,744 80,356 23,090 25,620; 42,770 6,164 13,258! 48,830 13,028 45,813! 413,929 Sept. 6 50,966! 11,865 54,330 76,793 23,886 30,845! 42,644 5,763 13,7311 40,075 13,028 44,393! 408,319 Sept. 13 52,008; 13,815 52,307 77,121 22,984 24,1511 42,038 6,164 14,985; 45,293 13,916 43,059! 407,841 Cash in vault: Aug. 23 15,784: 4,708 16,650 24,756 11,092 13,290! 21,230 4,715 5,106; 15,377 19,881 161,858 Aug. 30 15,175; 4,929 15,053 24,861 11,960 12,801i 36,114 4,492 4,700i 15,567 10,055 19,836 175,543 Sept. 6 16,4561 5,181 16,129 28,836 11,692 14,180! 22,824 5,061 5,967 15,443 10,736 19,730 172,235 Sept. 13 13,062; 5,240 15,853 24.072 12,012 13,369| 23,657 3,991 5,144 17,631 10,336 22,410 166,777 Net demand deposits on which reserve is computed: Aug. 23 494,895 125,848 509,116 652,053 212,611! 194,9441 329,103i 55,751 112,645 373,431 116,414| 389,194 3,566,005 Aug. 30 505,502 126,362 513,383 664,055 230.8651 196,804! 339,613 55,711 113,370 384,215 117,5391 383,4401 3,630,859 Sept. 6 507,503 124,008i 526,079 645,919 214,186! 195,590! 341,194 56,474 121,156 384,509 121,8291 394,372! 3,632,819 Sept.13 516,377 127,975j 538,764 650,754 219,434 199,541j 347,131 j 57,043 131,953|388,244 125,850! 404,488 3,707,554 Time deposits: Aug. 23 27,193 19,908i 7,759 210,511 34,992 86,657 222,278! 16,099 23,75o| 63,738 19,001i 116,090 847,976 Aug. 30 27,826 20,067| 7,769 211,127 33,664 87,841 222,838i 16,119 23,821j 67,279 20,075J 116,742 855,168 Sept. 6 27,430 21,061! 7,599 211,568 33,795 88,416 224,4221 15,085 23,752! 73,846 19,797 121,027 867,798 Sept. 13 27,414 20,283' 10,050 211,852 34,268 88,288 225,059| 13,808 23,51" 62,746 19,547 122,187 859,020 Total net deposits on which reserve is computed: Aug. 23 503,053 131,820'. 511,444 715,206 223,109! 220,941 395,787' 60,581i 119,770 392,552 122,114! 424,021 3,820,398 Aug. 30 513,850 132,382; 515,714 727,393 240,964! 223,156 406,464] 60,547, 120,516! 404,399: 123,562; 418,463 3,887,410 Sept. 6 515,732 130,326! 528,359 709,389 224,325! 222,115 408,520 60,999!128,282! 406,6631 127,768j 430,680 3,893,158 Sept.13 524,601 134,060; 541,779 714,310 229,715 226,027 414,649; 61,185| 139,008; 407,068: 131,714 441,144 3,965,260 Government deposits: Aug. 23 53,388 13,078; 40,869 59,140 14,433 17,572 30,851i 4,152! 25,364! 29/ 9,574J 12,153 309,796 Aug. 30 36,574 10,038! 28,714| 40,653 11,270 13,727 19,909, 2,457! 23,426! 21,678 12,139 227,584 Sept. 6 44,927 9,870! 32,077 59,639 13,651 15,829 20,872! 2,680; 25,790! 23,162 12,009 267,397 Sept.13 31,391 7,600l 20,545 51,264 8,472 10,244 12,538: 6,280i 18,276 4,060! 29 172,785 Ratio of combined reserve and cash to total net de- i posits—percent: Aug. 23 13.5 Aug.30 14.3 Sept. 6 14.0 Sept. 13 13.9 Sept. 20 4. MEMBER BANKS OUTSIDE RESERVE CITIES. COUNTRY BANKS. I Number of reporting banks: | Aug.23 26 13 24 32 10 165 Aug. 30 23 26 13 24 32 10 165 Sept.6 23 26 13 24 32 10 165 Sept.13 23.| 26 13 24 32 10 165 United States bonds tosecure circulation: Aug. 23 10,084 : 6,098 4,005 7,654 10,374 2,000 , 750 ! 1,770 2,929 2,453 48,117 Aug.30 10,074 ! 6,098 4,005 7,654 10,374 2,000 i 750 ; 1,770 2,929 2,453 48,107 Sapt.6 10,074 ! 6,098 4,005 7,855 10,294 2,000 ! 750 ! 1,770 ! 2,942 2,453 48,241 Sept. 13 10,074 i 6,098 4,005 7,855 10,294 2,000 ; 750 1,770 i 2,942 2,453 48,241 Other United States bonds, including Liberty bonds: Aug. 23 5,426 14,549 5,142 6,691 11,156 732 1,577 ,i ,853 2,064 2,497 51,687 Aug. 30 5,423 14,035 5,081 6,586 10,548 1,613 ,758 1,962 3,077 50,652 Sept.6 5,406 13,993 4,952 6,326 10,417 566 1,562 < ,756 1,935 3,019 49,932 Sept. 13 5,349 13,371 4,219 5,802 10,047 508 1,551 ! ,525 1,949 3,012 47,333 United States certificates of indebtedness: Aug. 23 15,695 13,231 8,486 6,545 6,341 766 1,254 2,319 7,010 1,698 ! 63,345 Aug. 30 15,325 i 12,548 8,316 6,496 6,617 781 1,274 1,859 7,035 1,678 61,929 Sept.6.. 21,006 i 15,852 9,977 8,488 7,526 921 1,520 1,872 9,617 1,798 78,577 Sept. 13. 19,803 I 15.958 10,018 8,648 7,776 1,540 1,947 9,576 1,788 77,935 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOIJEIi 1, 1918. FEDERAL KESEEVE BULLETIN. 1039 Principal resources and liabilities of member banks located in central reserve, reserve, and other selected cities, as at close of business on Fridays, from Aug. 23 to Sept. 13, 1918—Continued. 4. MEMBER BANKS OUTSIDE HESEHVE CITIES—Continued. [In thousands of dollars; i. e., 000 omitted.] Boston. la A n t t - a. Chicago. Lo S u t. i s. M ap i o n l n i e s. - K C a i n ty s . as Dallas. Total. Total United Statessecurities owned: Aug. 23 31.205 33,878 : 17,633 I 20,890 27,871 3,581 5,942 ! 12,003 ...j 0,648 163,149 Aug. 30 30,822 32,681 17,402 I 20,736 27,539 3,350 | 3,637 5,387 I 11,926 7,208 KM), 688 Sept.6 36,486 35,943 ! 18,934 | 22,66928,237 .3,487 j 3,832 5,398 : 14,494 1 7,270 176,750 Sept. 13 35,226 35,427 " 18,242 I 22,30528,117 3,841 5,24.2 ! 14,467 7,253 173,509 Loans secured by United States bonds and certificates: | Aug.23 ! 7,990 10,562 :1,771 1,051 3,292 63 j 566 1,166 | 402 616 27,479 Aug.30 1 7,989 10,472 i 1,753 1,073 3,191 79 i 572 687 i 343 639 26,798 Sept.6 ! 8,114 10,350 j1,773 1,060 2,786 69 ! 589 698 j 383 623 26,445 Sept. 13 i 7,456 10,055 1,784 1,059 2,830 67 ; 567 725 ! 311 614 25,468 Other loans and investments: : j Aug.23 ;223,744 200,174 ! 61,88982,606 110,541 12,442 : 10,757 21.633 | 62,900 29,226 815,912 Aug.30 1223,820 200,546 j 68,820 84,380 111,280 12,158 ! 10,575 22.634 63,027 28,947 ::::::::! 826,187 Sept.6 1225,401 203,262 ; 68,662 84,804 110,249 12,139 ! 10,364 22,744 63,238 29,626 830,489 Sept. 13 i214,710 200,597 68,299 83,939 107,747 12,142 10,697 22,950 64,877 30,780 816,738 Total loans and investments: I Aug. 23 !262,939 244,614 81,293 104,547 141,704 16,003 14,904 28,741 75,305 36,490 .1 1,006,540 Aug.30 1262,631 243,699 87,975 106,189 142,010 15,587 14,784 28,708 75,296 36,794 .1 1,013,673 Sept.6 |270,001 249,555 89,369 108,533 141,272 15,695 14,785 28,840 78,115 37.519 .1 1,033,684 Sept. 13 257,392 246,079 88,325 107,303 138,694 15,598 15,105 28,917 79,655 38,647 .! 1,015,715 Reserve with Federal Reserve Bank: I Aug.23 13,099 13,800 5,689 6,070 7,168 977 1,739 4,045 2,039 55,429 Aug.30... I 12,757 12,537 5,567 6,144 7,185 908 776 1,351 4,217 1,806 53,248 Sept.6 1 12,816 12,878 5,117 6,389 7,147 934 775 1,320 3,989 2,102 53,467 Sept. 13 | 15,028 14,346 5,562 7,213 6,801 895 785 1,620 4,204 2,101 58,555 Cash in vault: j Aug.23 ! 8,592 7,978 3,574 4,684 4,906 665 450 1,222 3,015 1,332 36,418 Aug.30 i 7,755 6,828 3,564 4,859 4,691 671 317 1,303 2,974 1,248 34,210 Sept.6 1 8,464 7,885 3,236 5,301 4,918 706 359 1,883 3,059 1,266 37,077 Sept. 13 8,835 8,036 3,785 4,756 5,202 821 278 1,614 2,801 1,436 37,564 Net demand deposits on ! which reserve is computed: I Aug.23 149,122 ! 179,819 70,123 68,930 83,077 ! 10,384 ! 8,848 46,178 ! ! 21,507; 654,638 Aug. 30 J149,425 ! 175,806 71,250 69,497 82,871 J1"0 ,090' | 8,537 44,462 ! I 21,032 649,336 S S~ e e p p t' t . . 1 6 "3 • ! 1 l5 5 2 8 , , 2 5 5 5 2 8 i | 1 1 7 8 7 5 , , 8 82 1 5 0 7 7 1 2 , , 7 8 0 0 6 9 6 7 9 1 , , 2 20 8 2 8 8 8 5 4 , , 3 2 4 5 5 9 1 1 0 1 , , 6 0 9 6 9 8 8 8 , , 7 5 1 7 7 7 4 4 5 7 , , 2 8 7 3 8 4 j i ! 2 2 2 , 0 2 , 2 ' 0 6 6 8 5 0 8 , ,6 8 8 8 9 9 Time deposits: Aug.23 69,760 I 31,402 6,502 24,747 18,397 3,625 4,363I 5,77: 21,617 [ 5,578 191,762 Aug.30 70,056 | 32,072 6,542 24,874 18,480 3,603 4,376 5,81 21,582 i 5,540 192,937 Sept.6 69,843 i 31,829 6,331 24,822 18,729 3,601 4,402 5,82 21,687 : 5,527 192,599 Sept. 13 69,717 32,121 6,471 24,922 18,701 3,561 4,394 21,707 i I 5,592! 192,978 Total net deposits on which reserve is computed: Aug.23 179,019 193,277 72,910 79,542 90,961 11,938 10,718 19,117 55,442 : 23,898 736,822 Aug.30 179,449 189,551 74,054 80,157 90,791 11,634 10,412 18,857 53,711 i 23,406 732,022 Sept. 6 182,185 191,451 74,419 79,926 92,286 12,242 10,603 20,245 54,572 ! i 23,302 741,231 Sept. 13 188,437 199,591 75,582 81,883 93,360 12,594 10,460 19,933 57,137 ! 24,617 763,594 Government deposits: Aug.23 14,842 15,393 4,787 2,475 4,607 128 405 710 3,461 951 47,759 Aug.30 10,389 9,939 3,352 1,739 3,156 95 265 405 2,619 654 I 32,613 S Se e p p t t . . 6 13 1 8 .1 , , 1 2 1 8 9 8 1 10 2 , , 8 6 4 2 9 2 3 2 , , 2 2 9 5 4 0 2 1 , , 1 86 5 8 5 3 1 , , 5 86 0 5 4 1 6 2 5 5 2 1 2 7 1 6 3 2 7 1 0 5 3 2 , , 9 6 1 9 4 0 !; I 1 6 7 6 0 4 • j • 3 2 8 8 , , 0 3 9 2 7 7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1040 FEDERAL BESERVE BULLETIN. OCTOBER 1,1918. EARNINGS ON INVESTMENTS OF FEDERAL RESERVE BANKS. Average amount of earningg aasssseettss hheelldd ,b byy eeaacchh F Feeddeerraal l RReesseerrvvee BBaannkk dduurriningg AAuugguusst,t , 11991188, , eeaarrnniinnggss from each class of earning assets, and annual rates of earnings on basi'sJ Oof// August, 1918, returns. Average balances for the month of the several classes of earning assets. i Bills dis- Federal Reserve Bank. | • m F c e o e m d u e n b r t e a e r l d s . R f a o e n r - d in B o i p ll e s n b m ou a g rk h e t t. un se it c e u d r it S ie ta s t . es M wa u r n r i a c n ip ts a . l Total. serve Banks. Boston §74,412,382 $22,276,263 j $2,356,195 $99,044,840 New York.... 464,390,976 116,073,366 | 8,319,634 $26,075 588,834,497 Philadelphia.. 88,101,492 11,640,219 ! 2,562,608 102,304,319 Cleveland 93,736,044 22,173,433 I 4,615,932 i 120,525,409 Kichmond 58,910,217 5,500,465 2,743,652 j 87,154,334 Atlanta 44,925,417 3,319,369 1,681,247 . 38,273 49,964,306 Chicago 217,747,554 11,770,932 6,620,650 i 236,139,136 St. Louis 52,149,004 2,148,932 1,753,110 56,051,046 Minneapolis... 58,442,000 473,000 1,575,000 : 60,490,006 Kansas Citv.. 68,016,349 133,635 10,149,224 i 78,299,208 Dallas.../.... 39,270,508 733,804 5,105,913 : 45,110,225 San Francisco. 77,599,551 20,865,105 4,682,283 j 103,792,101 Total... 1,337,701,494 217,108,523 52,165,448 ! 64,348 1,607,709,421 I Earnings from— Calculated annual rates of earnings from— Bills dis- Bills dis- Feder B a a l 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 f r l o s r m i b n o B a o u r i k p l g l e e h s n t t . se U S cu n ta r i t i t e t 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 b d r d e a r f l o s r m i b n o B a o u r i k l p g l e e s h t n t . se U S cu n ta r i t i t e t e i s d es. M wa u r n r i a c n ip ts a . l Total. Reserve Reserve Banks. Banks. Per cent. Per cent. Per cent. Per cent. Boston 8271,688 §78,768 ! 86,216 S312,380 4.30 4.16 3.11 New York 1,640,915 418,111 j 21,776 8104 2,080,906 4.16 4.24 3.08 4.71 Philadelphia.. 316,526 41,849 : 7,254 365,629 4.23 4.23 3.33 Cleveland 352,422 80,130 ! 13,264 445,816 4.43 4.25 3.38 Richmond 225,679 22,190 ! 6,330 254,199 4.51 4.74 2.71 Atlanta 163,840 11,797 i 4,473 149 180,259 4.29 4.18 3.13 "4." 59* Chicago 800,116 45,045 ; 15,620 860,781 4.33 4.51 2.78 St. Louis 193,717 8,468 ! 3,726 205,911 4.39 4.64 2.50 Minneapolis... 233,798 1,948 2,748 238,494 4.71 4.85 2.05 Kansas City... 287,940 587 | 20,662 309,149 4.98 5.17 2.39 Dallas......... 156,510 2,785 • 14,546 173,841 4.69 4.47 3.35 San Francisco. 299,973 76,602 . 10,840 387,415 4.55 4.32 2.78 Total 4,943,124 | 327.415 253 5,814,780 4.35 4.38 2.87 4.63 4.27 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBBB 1, 1918. FEDEBAL KESEBVE BULLETIN. 1041 IMPORTS AND EXPORTS. Gold imports and exports into and from the United States. (Tn thousands of dollars; i. e., 000 omitted.] Ten days Eleven days Total, Jan. 1 ending Aug. ending Aug. to Sept. 7, 20,1918. 31, 1918. eni0??918.P ' 1917. IMPORTS. Ore and base bullion 193 328 735 9,734 11 034 United States Mint or assay office bars 6 114 Bullion refined i70 187 225 38,078 381 390 United States coin 6; 774 53,186 Foreign coin 169 94,388 Total 363 515 961 54,761 540,112 EXPORTS. Domestic: O U r n e i t a e n d d S b t a a s te e s b M ul i l n io t n or assay office bars a! 2 7 1 3 1 2 0 44,6 1 6 3 8 6 Bullion refmed 30 6,846 29 205 Coin 1,035 i, 299 1,02-1 24,708 242,796 Total 1,067 1,338 1,056 32,396 316,805 Foreign: Bullion refined 31 Coin 81 3 417 5,476 Total 81 3 417 5,507 Total exports . .... 1,148 1,341 1,056 32,813 322.312 Excess of gold imports over exports since Jan. 1,1918, $21,948,000; excess of gold imports over exports since Aug. 1,1914, $1,072,252,000. Silver imports and exports into and from the United States. [In thousands of dollars; i. e., 000 omitted.] j Ten days | Eleven days j Ten (lavs j j ending i ending i ending j Total since i Aug. 20,1918.! Aug. 31,1918.! Sept. 10,1918.!Jan. 1,1918. • ' I Ore'and base bullion 1,502 | 2,357 | 2,576 ! 27,550 United States Mint or assay office bars.. 50 Bullion refined 62 I 18,823 United States coin 38 I 186 27 j 748 Foreign coin 54 ; 8 59 i 3;400 Total 1,656 ! 2,866 | 2,960 i 50,571 EXPORTS. Domestic: Ore and base bullion 12 United States Mint or assay office bais 21,702 Bullion refined 17,504 j 1,351 ! 123,425 Coin 2S j 3 I 2,588 Total. 564 I 18,127 ; 1,300 ! 147,727 Foreign: Bullion refined. 149 ! 171 3,644 Coin 92 : 187 5,016 Total. 35S | S, 660 Total exports.. 805 i 18,485 ! 156,387 Excess of silver exports over imports since Jan. 1, 1918, $105,816,000; excess of silver exports over imports since Aug. 1, 1914, .$204,G65,C<D0. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1042 FEDERAL RESERVE BULLETIN. OCTOBER 1, 1918. Estimated general stock of money, money held by the 'Treasury and by the Federal Reserve system, and all other money in the ' United States Sept. 1, 1918. G o th e f e n S m e t U r o a a n t n l e e i s s t y t . e o d i c n k G U T a H o n s r s e v i e t e l e a e d t r s d s n u i o n m S r f y t t e a t h a n h t e e s t e . s 1 H s F a e e n e l r d d v d e e b a r g y B a e l a o n R n r ts k e f . - s or u H S e t r r h t y e s a a e l y t l d a e s R U n s t o d e e n T u m s i t r e t s e F e . r i a v e d d s d e e - - c S A u a F th t r p e m a y e i d t t e o a e U a s u r n o a n d n T u l i t r t t e R p e s t a i h d e e d s e r - - e servo system. Gold coin = j S3,079,300,229 $261,241,260 81,421,604,718 8436,720,562 '.. Gold certificates I 483,171,590 476,553,099 i. Standard silver dollars j 460,253,959 34,242,617 79,480,196 • Silver certificates j 7,050,082 337,646,831 ! Subsidiary silver i 231,874,845 "l6," 592," 279' a 762,814 220,519,752 Treasury notes of 1890 ! 1,834,233 i United States notes I 346,681,016 6,286,424 * 45,174,282 295,220,310 ! Federal Reserve notes j 2,225,838,710 34,502,755 100,530,120 2,090,805,835 Federal Reserve bank notes ! 24,687,960 247,635 3,349,492 21,090,833 National bank notes | 724,318,652 22,824,090 8,728,705 692,765,857 ; Total: I Sept. 1, 1918. 7,092,955,371 369,937,060 2,070,371,803 4,652,646,508 $43.S3 Aug. 1, 1918.. 6,895,089,799 390,798,058 2,054,455,993 4,449,835,748 41.97 July 1, 191S.. 6,742,225,784 356,124,750 2,018,361,825 4,367,739,209 41.31 Juriel, 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 Apr. 1, 1918.. 6,480,181,525 339,856,674 1,873,524,132 4,266,800,719 40.47 Mar. 1, 191".. 6,351,548,056 330,927,176 1,827,126,208 4,193,494,672 39.83 Feb. 1,1918.. 6,271,603,039 332,576,125 1,834,102,608 4,104,924,306 39.04 Jan. 1, 1918.. 6,256,198,271 277,043,358 I 1,723,570,291 4,255,584,622 40.53 Dec. 1, 1917.. 6,026,127,909 248,167,148 } 1,646,773,746 4,131,187,015 39.40 Nov. 1, 1917.. 5,823,854,335 242,265,377 ; 1,546,124,691 4,035,464,267 38.54 Oct. 1, 1917.. 5,642,264,856 242,469,027 i 1,429,422,432 3,970,373,397 37.97 Sept. 1, 1917.. 5,553,661,154 239,654,267 ; 1,373,987,061 3,940,019,826 37.73 Aug. 1, 1917.. 5,513,292,894 248,268,325 ) 1,395,982,728 3,869,041,841 37.10 July 1, 1017.. 5, 480,009,884 253,671,614 ' 1,280,880,714 3,945,457,556 37.88 1 Includes reserve iunds against issues of CJnited 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. 2 Includes balances in gold settlement fund standing to the credit of the Federal Reserve Banks and agents. 3 Includes standard silver dollars. * Includes Treasury notes of 1890. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OCTOBEIt 1, 1918. FEDERAL EESEEVE BULLETIN. 1043 DISCOUNT KATES. Discount rates of each Federal Reserve Bank approved by the Federal Reserve Board up to Sept. SO, 1918. Maturities. Discounts. Trade acceptances. Secured by U. 8. certificates of indebted- Fedora! Reserve Bank. Wi d t a h y in s, 15 t A ur g a r l i c a u n l d - n b e o s n s d o s. r Liberty loan i c m n o b c l e a l l m u a n t d k b e i s r e n ' a r g l 16 d a t y o s. 60 61 d a to y s. 90 liv o p d e v a a - e p s r v t e o 9 s r . c 0 k d in W a g y s i m t .i h n e i c m n l u b 1 d e 5 .- r j ! i 16 to 90 in 1 c d l a t u o y s s i 6 v , 0 e. in 6 c 1 d l a u to y s s iv , 90 e. notes. banks' days. collateral notes. Boston 4 New York i... 4 Philadelphia.. 4 Cleveland Richmond %\ Atlanta Chicago ' i St. Louis Minneapolis. - - Kansas Cilv... Dallas.....'.... San Francisco. 1 Hate of 3 to Q per cent for 1-day discounts in connection with the loan operations of the Government. 2 Kate for trade acceptances maturing within 15 days, 4£ per cent. NOTCEE 11..——AAcceptances purchased in open market, minimum rate 4 per cent. NOTPEE 2.—Rates for commodity paper have been merged with those for comLnmercial paper of corresponding maturities, NOTHE 33 3.—.—IInn ccaassee tthhee 6600--ddaayy ttrraaddee " aacccceeppttaannccee rraattee iiss 1hiigghheerr tthhaann tthhee 1155--ddaayy discount rate, trade acceptances maturing within 15 days will be taken at the lower rate. 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 pa~per of the same class. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDEX. Page. Informal rulings of the Board: Page. Acceptance corporation, establishment of, for finan- Eligibility of farmer's notes given for purchase cing cotton 939 of silos 971 Acceptances: Eligibility of chain of banks for membership. . 971 Banks granted authority to accept up to 100 per Trade acceptances ~ 971 cent of capital and surplus 967 Custody of shipping documents or warehouse Distribution of, statement showing 1025 receipts 971 Amendments to Federal Reserve Act as passed by Revenue stamps on drafts drawn to finance sales Congress 947-950 of goods to Allied Purchasing Commission 972 Interest and discount rates prevailing in various American Bankers' Association: cities 1016-1019 Report of Committee of Five to consider check International Banking Corporation, stock of purclearing and collection charges .. 962-964 chased by National City Bank of New Yorkt... 937 Statement fey, relative to conditions of savings Law department: banks in the United States 952-954 Rediscount of draft for railroad supplies 974 Assets and liabilities of leading central banks of Trade acceptances as bills of exchange drawn issue, 1914 and 1918 996 against actually existing values 974 Bank clerks, status of, under draft law 957-961 Acceptance of drafts of Food Administration British bank amalgamations, report of special com- Grain Corporation 976 mittee on 954-957 Drafts growing out of transactions involving British treasury bills, issuance of, in the United the importation or exportation of goods. ..T 976 States : 940 Rulings of Commissioner of Internal Revenue Business conditions throughout the Federal Reserve as to stamp tax on trade acceptances and districts 979-995 promissory notes 977 Charters issued to national banks during the month. 967 Amendments to Georgia banking laws 978 Charts showing condition of Bank of England, Bank Leffingwell, Hon. R. C, statement by, before of France, and German Reichsbank 999-1001 Ways and Means Committee regarding foreign Check clearing and collection system: exchange 940-942 Operation of ". - 1021 Liberty Bond Act, fourth, text of 961 Report of committee of American Bankers' As- Liberty bonds, list of lost and recovered 988-970 sociation relating to 962-964 Liberty loan, fourth, announcement regarding 937 Commercial failures reported 967 Meal tickets for use by drafted men en route to Comparative statement of leading banks of issue, camp, member banks requested to receive for 1914 and 1918 996 collection 93s Conservation of credit: Member banks, statement showing condition of. 1035-1039 Letter of .Liberty loan subcommittee relative to Money, stock of, in the United States 1042 restrictions on speculation 935 National City Bank of New York: Letter of New York Federal Reserve Baiak rela- Branch of, established in Cuba 938 tive to curtailment of loans 935 Foreign banking operations of 942-947 Letter of Utah banking commissioner rela- Stock of International Banking Corporation tive t® 936 purchased by 937 List of preferred industries issued by War In- Resources and liabilities of Federal Reserve dustries Board in connection with 931-934 Bank 1030-1032 Countries in which banks are authorized to draw Review of the month: drafts for purpose of furnishing dollar exchange.. 938 Certificates of indebtedness 921 Cuba, branch of National City Bank of New York The fourth Liberty loan 921 established in 938 Program of rationing 922 Directors of Federal Reserve Banks, amendment to Conservation of credit 924 act relating to election of 950 Loans on Government securities 925 Discount and interest rates prevailing in various The new revenue bill 926 cities 1016-1019 New bond legislation 926 Discount operations of the Federal Reserve Growth of Federal Reserve notes 927 Banks....' 1022-1029 Operations of Federal Reserve Banks 928 Discount rates in effect 1043 Condition of member banks <r. 929 Dollar exchange, list of countries in which banks are Gold imports and exports 930 authorized to draw drafts to furnish 938 A new discount corporation 930 Earnings on investments of Federal Reserve Banks. 1040 Amendments to Federal Reserve Act 930 Federal Reserve Act, amendments to: Easing the currency movement 931 Relating to election of directors of Federal Re- Meeting of the Advisory Council 931 serve Banks 950 Rulings of the Division of Foreign Exchange 973 Text of, as passed by Congress 947-950 Savings banks in the United States, statement by Federal Reserve agent's fund, transactions through. 1020 American Bankers Association relative to condi- Federal Reserve note account of Federal Reserve tion of 952-954 Banks and agents 1033-1034 Silver, imports and exports of 1041 Fiduciary powers granted to national banks 967 State banks and trust companies: Foreign banking operations of the National City Admitted to the system during the month 966 Bank of New York 5)42-946 Statement showing number, resources, etc., of Foreign banks of issue, assets and liabilities, 1914 banks admitted to system during 1918 964 and 1918 996 Total bank transactions, reports of 1002-1004 Foreign banks, statements showing condition of Treasury certificates of indebtedness, new issues of. 951 Bank of England, Bank of France, and German Union Discount Corporation, organization of, for Reichsbank 998 financing cotton 939 Foreign exchange, statement regarding, by Hon. War Finance Corporation, circular on cattle loan R. 0. Leffingwell before Ways and Means Com- agencies issued by 950. mittee -V 940-942 War Industries Board, preference list of industries Gold, imports and exports of 1041 and plants compiled by, in connection with con- Gold settlement fund, transactions through... .1019-1020 servation program \'. 931-934 Index numbers of wholesale prices 1005-1015 Wholesale prices, index numbers of 1005-1015 O Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis