Federal Reserve Bulletin March 1919

FEDERAL RESERVEBULLETIN

ISSUED BY THE

FEDERAL RESERVE BOARDAT WASHINGTON

MARCH, 1919

WASHINGTONGOVERNMENT PRINTING OFFICE

1919

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BOARD.

EX OFFICIO MEMBERS.

CARTER GLASS,

Secretary of the Treasury, Chairman.JOHN SKELTON WILLIAMS,

Comptroller of the Currency.

J. A. BRODERICK, Secretary.

W. T. CHAPMAN, Assistant Secretary.

W. M. IMLAY, Fiscal Agent.

M. JACOBSON, Statistician.

W. P. G. HARDING, Governor.

ALBERT STRAUSS, Vice Governor.

ADOLPH C. MILLER.

CHARLES S. HAMLIN.

GEORGE L. HARRISON, General Counsel.

H. PARKER WILLIS,

Director, Division of Analysis and Research.

F. I. KENT,Director, Division of Foreign Exchange.


SUBSCRIPTION PRICE OF BULLETIN.

The Federal Reserve Bulletin is distr i piu tet d wit ho u t chargeto member banl<s of the system and to the oiiTcerTanT^nec^rTof Federal Reserve Banks; In sending the Bulletin to others theBoard feels that a subscription should be required. It hasaccordingly fixed a subscription price of $2 per annum. Singlecopies will be sold at 20 cents. Foreign postage should be addedwhen it will be required. Remittances should be made to theFederal Reserve Board. Member banks desiring to have theBulletin supplied to their officers and directors may have it sentto not less than ten names at a subscription price of $1 per annum.

No complete sets of the Bulletin for 1915, 1916, or 1917are available.


TABLE OF CONTENTS.

Page.Review of the month 189Business conditions in February 202Special report to the Board on business readjustment in the United States 205Statement of Secretary of Treasury before Ways and Means Committee concerning the fifth Liberty loan 218Text of fifth Liberty loan act 225Amendments to the Federal Reserve Act as passed 228Study of credit barometrics, prepared by Mr. Alexander Wall 229Rules and regulations adopted by the New York Clearing House Association regarding check collections 243Formation of the Industrial Board of the Department of Commence to put into effect a program for the readjust-

ment of prices 246Report of committee appointed by the Secretary of the Treasury to investigate conditions in the gold-mining

industry 248Ruling of Commissioner of Internal Revenue relative to computation of discount and interest rates for taxation

purposes 249Instructions by Comptroller relative to method of reporting certain items on call report 249Statement of condition of national banks, issued by the Comptroller 250State banks and trust companies admitted to the system during the month 250Banks granted authority to accept up to 100 per cent of capital and surplus 251Fiduciary powers granted to national banks 251Commercial failures reported 252Charters issued to national banks during the month 252Rulings of the Federal Reserve Board 253Law department 254Bank transactions during January-February 258Index of wholesale prices 261Discount and interest rates prevailing in various cities 265Physical volume of trade 267Gold settlement fund transactions 274Bills and war paper discounted during each month in 1918 by all Federal Reserve Banks and by the Federal

Reserve Bank of New York 276Chart showing 277

Discount operations of the Federal Reserve Banks 278Resources and liabilities of the Federal Reserve Banks 282Federal Reserve note account of the Federal Reserve Banks and agents 285Member bank condition statement 287Imports and exports of gold and silver 290Estimated stock of money in the United States 291Discount rates in effect 292Operation of the Federal Reserve clearing system 293Condition of principal European banks of issue, 1913-1918 294Abstract of condition of member banks 296

IV


FEDERAL RESERVE BULLETINVOL. 5 MARCH 1, 1919. No. 3

REVIEW OF THE MONTH.

The outstanding feature of public financeduring the month of Februaryh a s b e e n t h e f u r t h e r develop-ment and announcement of the

conditions under which the fifth Liberty loan isto be offered to the public. It has been decidedto make the actual offering of the loan a littlelater than had been originally intended, openingthe campaign on April 21 and financing the Gov-ernment in the meantime by further issues ofshort-term certificates of indebtedness. Ofthese certificates two issues have been placedon the market during the month of February,being announced under dates of February 7and February 21 and for amounts of$687,381,500 and $620,578,500, respectively.The total of such certificates of indebtedness ofall issues now outstanding in anticipation ofthe proceeds of the fifth loan is thus$3,845,678,000. Assuming that the fifth loanwill amount to about $6,000,000,000, it is thusseen that practically two-thirds of the entireissue has already been drawn from the banksand applied to public purposes. Governmentexpenses have materially declined during themonth of February, the total net expendituresfor the month being only about $1,200,000,000.As an offset to this favorable showing it should,however, be remembered that the month con-tained only 28 days, so that the reduction isnot so great, relatively speaking, as it seems.Nevertheless, the turn of the tide has undoubt-edly set in, and it may be expected that fromthis time forward, in the absence of new orunusual appropriations, the monthly outgoesof the Government will be less rather thanmore. The banks, however, are already car-rying a very substantial burden of certificates

| of indebtedness, as has just been pointed out,and before the actual floating of the new loanit may be expected that the total of theiradvances will have aggregated well toward abillion dollars above the proceeds of the newloan or, what is the same thing, that outstand-ing issues of certificates will have had to bemet from the proceeds of new issues, as hasbeen the case in the past. Meanwhile, theHouse of Representatives on February 8adopted the conference report on the warrevenue bill, the Senate taking similar actionon February 12, while the measure was signedand became a law on February 24. This actis now expected to produce a revenue of atleast $6,000,000,000, of which the first pay-ment of substantial amount must be made atthe time when the returns are filed with theBureau of Internal Revenue on March 15.These tax contributions will thus be receivedin time to be of material assistance in solvingthe financial problems of the Government,since the tax receipts will probably antedateby about five to six weeks the first install-ments from subscriptions to the fifth loan.

The Secretary of the Treasury on February10 sent to the chairman oft h e H o U s e W a ^ S a n d M e a n S

Committee a notable letter inwhich he set forth plans for the financing of thefifth Government loan. With this letter wastransmitted the draft of an act designed tocarry into effect the plan of finance which Mr.Glass had thus sketched. The bill as thus pro-posed would (1) increase the authorized issue ofbonds from $20,000,000,000 to $25,000,000,000;(2) remove the limitation as to interest rate sofar as regards bonds maturing not more than

I 10 years from the date of issue; (3) authorize! the issue of not to exceed $10,000,000,000 of

189


190 FEDERAL RESERVE BULLETIN". MARCH 1,1919.

interest-bearing, noncirculating notes havingmaturities from one to five years; (4) authorizethe issue of bonds and notes payable at apremium; (5) exempt war-savings certificatesfrom income surtaxes; (6) confer authorityupon the Secretary of the Treasurj^ to deter-mine the exemptions from taxation in respectto future issues of bonds and notes and to en-large the exemptions of existing Liberty bondsin the hands of subscribers for new bonds andnotes; (7) exempt from income surtaxes andprofits taxes all issues of Liberty bonds andbonds of the War Finance Corporation heldabroad; (8) extend the period for conversion of4 per cent Liberty bonds on the lines suggestedin the Secretary of the Treasury's letter ofJanuary 15 to the chairman of the HouseWays and Means Committee; (9) create a 2\per cent cumulative sinking fund for the retire-ment of the war debt; (10) continue the exist-ing authority for the purchase of obligationsof foreign Governments after the terminationof the war in accordance with the views ex-pressed by Secretary McAdoo by letter and inhis testimony before the Ways and MeansCommittee; and (11) extend the authority ofthe War Finance Corporation so as to permitit to make loans in aid of our commerce, thussupplementing the aid which may be given bythe Treasury on direct loans to foreign Gov-ernments and in a measure relieving theTreasury of demands for such loans.

The Ways and Means Committee of theHouse of Representatives has,however, been disposed tomodify the plan proposed by

the Secretary of the Treasury by the substitu-tion of short-term notes for bonds. This alter-native plan accordingly provides for the issueof several classes or grades of short-termnotes, one bearing a lower rate of interestand entirety nontaxa,ble, another bearing ahigher rate of interest and fully taxable, withone or two intermediate grades providingfor rates of interest higher than, that fixed forthe nontaxable notes, but not as high as therate established for the taxable issue. Theseintermediate issues would be only partially

exempt from taxation. The difference be-tween the general proposal to place an issue oflong-term bonds and that which contemplatesthe sale of short-term notes of varying maturi-ties and conditions is practically one of bank-ing technique. Short-term securities are not,on the whole, as well adapted for investmentby private individuals as longer term issues,while financial custom has usually dictated theabsorption of short-term issues by investmentinstitutions. Practically, therefore, the alter-native plan just outlined would tend towardthe placing of a greater volume of the newissues definitely in the hands of the banks andof investment institutions throughout thecountry, and less in the hands of private indi-viduals. This is equivalent to saying that itmay probably be more difficult to obtain awide distribution of the fifth loan if it be offeredin the form of short-term notes than if it besold as longer term bonds. The alternativeplan would also tend to make the whole opera-tion more transitory and temporary in itsworking than would the original plan of a bondissue. I t would necessarily imply that theearly maturity of the notes must be lookedforward to and that an extensive refundingoperation must take place when such maturityarrives. On the whole, the note plan wouldtherefore operate to increase the inflationarytendency already noticeable in the presentbanking situation and would add, relativelyspeaking, to the burden carried by the banks.Should the commercial banks continue toretain the notes thus purchased, they wouldin effect be retaining upon a longer basis thanhad been expected the Government securitieswhich are now in their hands. If, for example,the present issues of Treasury certificatesshould be paid for through sales of short-term notes which were largely taken by thebanks, the transaction would amount in prac-tice to the conversion of the certificates whichmight be in the hands of the banks intoshort-term investment paper which might re-main practically where the certificates are nowheld. There would be some readjustment orredistribution of these holdings, but so far as


MARCH 1, 1919. FEDERAL RESERVE BULLETIN. 191

the banking community as a whole was con-cerned, the case would be somewhat the sameas at present. This would mean a continua-tion of the tendency to finance business to aconsiderable extent by the use of "war paper7'and would make it more difficult to transferGovernment obligations to the strong boxes ofprivate investors. Such a result is to beavoided if possible. On this point the Secre-tary of the Treasury has said: "Whether they[the new securities] be bonds or notes, it isabsolutely essential that the widest possiblemeasure of distribution be realized."

In transmitting to the House Ways andMeans Committee the bill pro-

Tile reton to • v c ,-, r • £ nnormal conditions, vidmg for the financing oi the

fifth loan, the Secretary of theTreasury gave utterance to the following note-worthy expression of opinion concerning presentconditions as to prices and the extension ofbank credit: "The necessary and desirablecontraction of our credit structure has begunand will be greatly facilitated by the enactmentof appropriate legislation to permit the liquida-tion of claims arising under informal armycontracts. Steps have been taken to breakthe deadlock which had arisen growing outof the maintenance, nominally at least, of warprices in certain basic industries. Upon theenactment of appropriate legislation to enablethe Food Administration to protect the guaran-ties given by the United States, I am hopefulthat it will prove possible to restore theoperation of the law of supply and demandwith respect to foodstuffs with, as I believe,a consequent reduction in the cost of living.A period of rising prices and of intense indus-trial activity such as we have experiencedduring the past four years is always a periodof great apparent prosperity, and a periodof falling prices and of the contraction ofcredits is always a period of depression. Theretardation of the process of readjustment byartificial means can only increase the evils in-herent in the situation. Buying will not beginand activity will not set in until the communityat large is satisfied that prices have reached

bedrock.7' Mr. Glass further expressed theopinion that a sound and conservative finan-cial policy on the part of the Governmentwould unquestionably result in "a new periodof great and growing prosperity," believingthat even before the expiration of two monthsfrom the present date the successful placing ofthe Victory Liberty loan and the consequentreadjustment of business relations to correspondto the conditions thus created might reason-ably be expected.

As has thus been pointed out by the Secre-tary of the Treasury in unmis-

The problem of takable terms, an urgent prob-readjustment. .. * , • T

iem oi busmess readjustmentis that of restoring prices to a stable basis.The era of inflated prices maintained by aidof legislation or by Government administra-tive action thus draws to a close, and the aimto be sought is not that of perpetuating warconditions but that of returning to a stablefooting upon terms and conditions that wouldbejust and fair to all concerned. There is muchagreement with the Secretary of the Treasuryin his statement that the readjustment mustbegin with a reduction in the cost of living tothe consumer, sorely tried as the latter hasbeen by the great inflation of prices and theadditions made to his living costs in manydirections. "Readjustment77 thus becomes aproblem which involves the effective transfer oflabor from war work back to peace employmentat stable and satisfactory remuneration, thecurtailment of costs of production to a pointthat will enable our manufacturers to satisfydomestic demand and compete favorably withforeigners for the export trade, and the ad-justment of values generally to one anotherupon the new basis created by normaliza-tion of prices and wages. It would be un-reasonable for any factor in production toassert that it would not bear its share in thisgeneral process of readjustment. Such read-justment is designed for the common benefitof all participants in industry and the publicat large. If it be equitably carried out, itseffects will not tend to favor any particular


192 FEDERAL RESERVE BULLETIN. MARCH 1,1919.

class or group in the community, but willoperate, while leaving all in the same relativeposition, or at all events in an admittedlyequitable relationship one to another, to in-crease the general volume of business and theregularity and smoothness with which theindustrial mechanism moves and functions.

The phase of the problem which has beenreceiving most attention during

menf °r readJust" the past month arid which hasin many ways been productive

of most difficulty, has been the determinationof the workers* share in the process. It wasunavoidable that as a result of the war verygreat changes in the character of employment,as well as in the rate of wages, should occur.I t seemed equally inevitable that in the processof transition back to a peace basis there shouldbe similar readjustment of a reverse sort. Nota few industries have necessarily suspended orcurtailed their operations, because their productis no longer wanted, or at all events is notdemanded in the same volume as formerly.The placing of labor in peace industries at re-munerative wages, opening to it channels ofoccupation and advancement as fast as it isreleased either from service in the Array orfrom the equally important industrial warwork, can not be instantly effected, but everyendeavor should nevertheless be made to carryit out as rapidly as conditions will permit.

Striking appreciation of this necessity wasexpressed by the President when immediatelyupon his return to Washington he summoneda conference of the governors of the severalStates to meet at the White House on March 3.The purpose of the conference was that of deter-mining a method of business readjustmentwhich shall be uniform and which shall enlist theunited efforts of the several States. The Presi-dent's action shows the urgency of the problemwhich the country is facing in connection withthe restoration of business to a peace basis.

One way of estimating the degree of oursuccess in readjustment is that of ascer-taining how rapidly and how successfully thisreabsorption of labor is effected. Reports

received from Federal Reserve agents and fromvarious other sources indicate that at least areasonable degree of progress m this matter isbeing attained. The problem of unemploy-ment, while undoubtedly serious for the time,does not appear to be growing in magni-tude as rapidly as some had predicted. Inthe following table derived from the recordsof the United States Employment Office isfurnished an approximate estimate of the totalamount of unemployment existing throughoutthe country at the date for which the figureswere collected:

Weekending—

1918.Dec. 7Dec. 14Dec. 21Dec. 28

1919.Jan. 4Jan. 11Jan. ISJan. 25Feb. 1Feb. 8Feb. 15Feb. 22

Num-

ing.

122122120122

121122122122122122122122

Num-ber

ingshort-age.

29302526

2722181816171818

Esti-mated

48,22647,13041,00235,542

33,39720,03318,64414,35011,3609,3138,9438,014

Num-ber

citiesshow-

ingsur-

plus.. . .

16263741

4746556169727482

Esti-mated

surplus.

22,20030,00066,35091,889

120,589175,951211,700258,332292,831323,685358,797367,130

Number cities show-ing industrial rela-tion.

Good.

91958891

8782838378757474

3 as—

Unset-tled.

8776

98

121417141517

Acute.

5477

68

128

10171816

The process of industrial readjustment hasundoubtedly been advanced

Industrial read- considerably during the monthoi February. A notable phase

of it is seen in the reduction of ocean freightrates, first put into effect by British shipownersand then extended and carried further by theUnited States Shipping Board. Tfee effect ofthis readjustment has been to reduce by fullytwo-thirds, or in some cases three-fourths, theextraordinarily high charges which had beenlevied during the war. The new ocean rateshave not been reduced to the prewar level,but they have been brought down well towardit. In line with this same tendency to re-arrangement of charges is the cutting of nota few basic prices. Thus, for example, pricesof various grades of iron and steel have reacheda distinctly lower stage during the month, pig



iron selling as low as $29.20 per ton, whilecopper, "stabilized" at 26 cents when the warwas at its height, has now receded to a price of17 cents, with sales at 16 cents or lower, whileother metals have declined in the same or agreater proportion. It is believed that thesealterations and others like them may be takenas definite indications that the work of indus-trial reorganization is under way. Furtherindication is found in the circumstance thatduring the month of February a genuineincrease in the number of new building enter-prises occurred, this increase representing asubstantial percentage of the work in progressat this time a year ago. Active buying ofsome staples for the purpose of providing thenecessary materials of manufacture has alsorecommenced, and the effect has in somedirections been to bring about an upwardtrend in prices which had previously declinedfrom the war level. Increase of strictly peaceorders is reported at many factories producingessential materials or partly manufacturedarticles. This is a necessary preliminary to therestoration of demand in the full sense of theterm at factories producing goods for immedi-ate consumption.

One danger often encountered in periodsof industrial readjustment isfound in the offer of securities,so called, representing unde-

sirable or at least inopportune investmentproposals. These naturally grow out of thefact that in time of extensive industrialreorganization there is much shifting of invest-ments, without due appreciation of the hazardsof the situation. Besides such sincere ifmistaken efforts looking to the placing of newsecurities which are honest in intent eventhough not well founded in prospect, there arefrequently to be noted many classes of issueswhose projectors have been more desirous ofmaking profits than of providing a safe security.The danger is particularly acute in a periodlike the present when many persons in the com-munity who have purchased Liberty bonds areholding them in part on the strength of bor-

106597—10 2

Safeguardingcapita!.

rowed funds and only in part on the strengthof savings. To this is added the fact thatothers who have paid fully for their investmentsfeel that now that the country's emergency isover they may reasonably be permitted to ex-change their holdings for more remunerativesecurities. Since, in many cases, Liberty bondsare held by persons who have not in the pasthad much experience in modern forms of invest-ment, the danger in the situation may becomeacute through the exchange of Governmentsecurities of undoubted value for securities ofdoubtful solidity bearing promise of large re-turns. From the broader standpoint the effectof this process of gathering Liberty bonds intothe hands of those who wish to make a profitis that of tending to throw the securities uponthe market at a time when every effort shouldbe made to bring about their absorption andretention by bona fide investors of the countryas a whole. It was to meet this situation thatthe Capital Issues Committee prepared a billwhich, with the approval of the Secretary ofthe Treasury, was recommended to Congressfor adoption.

It is now becoming more and more evident, that an important phase ofForeign trade ... J f , , r

1 ,outlook. readjustment must be sought

in connection with our foreigntrade. Opinion as to this branch of businesshas undergone some change during the pastmonth. Up to the opening of February it hadstill been hoped by many that there would be aswift revival of activity and that our manu-factured products would be exported in some-thing approaching the volume developed duringthe war. Several influences have intervenedto prevent such a development. Importantamong these is the unsatisfactory position ofthe exchanges, making it imperatively neces-sary for some foreign countries to devote theirefforts to improving the exchanges by keepingdown the amount of their current foreign in-debtedness. Moreover, it has appeared that noinconsiderable part of the foreign-trade activityof the year 1918 was directly due to the factthat the United States was financing this ex-



port movement at low rates of interest throughthe advances made by the Treasury Depart-ment to the several foreign Governments.That these will not be continued upon theirformer level is, of course, an inevitable incidentof our change from a war to a peace basis, andwith this change in Treasury policy somechange in the activity of those branches of ex-port trade which were dependent upon assist-ance of this kind is unavoidable. Finally, andperhaps more important than the other factors,is the circumstance that many of the industrialdistricts of Europe are proving far better ablethan had been expected to supply the wants ofbuyers in the countries which have sufferedmost and are already beginning to take care ofthe trade of these regions. A further fac-tor is the circumstance that no settled policyhas as yet been adopted by the Govern-ment with respect to financing purchasesin our market on long credit. The un-stable peace situation is also probably to beregarded as a factor of some consequence. Itis not strange, therefore, that our exports ofsteel and other metals and of basic materialsof many kinds have fallen short of the moreoptimistic expectations that had been enter-tained and expressed. Our export figures for1918 loom large and those for the month ofJanuary attain in the aggregate record propor-tions; but they do not consist in the expectedkinds of manufactured goods. Even with ref-erence to that portion of our export trade whichconsists of food products, it is to be noted thatthe situation has not yet reached final adjust-ment. While we have been endeavoring tomaintain the fixed price of $2.26 per bushel forwheat Argentina and Australia have been ex-porting their available surpluses of the grainat a very much lower figure, the price in Aus-tralia, as reported DV cable, being about $1.37for some large shipments, although differencesin transportation cost tend to equalize deliveryprices. This has naturally operated to curtailthe demand for our wheat abroad, and whilethat demand may be increased at a later dateafter the wheat surpluses of the other parts of

the world have been partially or wholly ex-hausted, it is still uncertain at what price ouravailable surplus Mali be disposed of. The ex-port trade in grain must, therefore, adjust itselfto a basis of tolerably close competition,which ma}" be expected to result in fixing andmaintaining a general level of prices decidedlylower than that with which we emerged fromthe war—how low can not as yet be stated. Itis because of the perception of the unlooked-fordifficulties in our export business that the Sec-retary of the Treasury in his letter to the Waysand Means Committee made recommendationthat authority be granted to the War FinanceCorporation for the making of loans "in aid ofour commerce/7 the purpose being to assist inthe continuous exportation of our availablesupply of goods. A special reason mentionedby the Secretary of the Treasury for the grantof this authority is found in the fact that theGovernment is possessed of large holdings ofproperty of various kinds in European coun-tries of which it wishes to dispose, and this maybe effected either through advances on the partof the Treasury which will result in transferringthe goods to European owners against thepledge of their Governments, or may be effectedby advances obtained from the War FinanceCorporation for the purpose of expediting themovement of the goods into private hands.

Restoration of something approximating anormal trade situation be-

°f t ween countries is indeedanin-Tf ^ade.dispensable element in the pro-

cess of world readjustment. Without suchrestoration it will prove impossible to resumefree movements of specie and to bring aboutan organization of foreign trade upon a basisthat may be regarded as enduring. In the longrun, exports and imports, including services,gold, and other items, taking one country ascompared with the remainder of the world,must tend to equalize themselves. When theydo not the "adverse" balance must be carriedas an investment or advance by the countrywhich has exported the excess of goods; inother words, must be carried on credit. During



the war there have been great changes in thedebtor and creditor relationships of mostcountries, and the United States has assumedthe position of a large creditor, notwithstand-ing that in the past it has invariably occupiedthat of a debtor. There is a limit to the extentto which it is ever economically advantageousfor one country thus to become indebted toanother, since it must annually liquidate theinterest on the advances made to it or else issuenew securities, a process which in itself speedilyreaches its limit unless the growth of indebted-ness results in a commmensurate increase inproductive and paying power. These factsunderlie the liexchange situation" to whichreference is frequently made, and do muchto explain the restricting of the movementof goods into foreign markets. Variouscountries are indebted to the United States,and while in some instances they themselveshave claims upon other countries, the claimsare not in such condition as to make eitherprincipal or interest available for liquidatingindebtedness to us, either in cash or in goods.Such a country must therefore expect to con-tinue to occupy a dual position, its status as acreditor almost necessarily signifying contin-uance in like manner as debtor. Action inattempting to restrict the movement of mer-chandise, such as was initiated by Great Britainin the adoption of a so-called restriction policy,would not perhaps have been thought necessarywere it not for the difficulties of their exchangeposition. Trade with the Central Powers hasnot yet been opened, but so soon as it is, theproblem of payment for their importations willbecome serious. Germany and Austria, it istrue, have but little foreign war indebtedness,but other nations are hardly in position toextend to them, even if disposed, verj largeadvances of credit. This condition of affairswill tend to make the scope of their foreigncommerce dependent to a considerable degreeupon the extent to which they can financethemselves through regular commercial andfinancial channels abroad. Thus, while govern-ment restrictions upon the movement andproduction of goods are in many respects being

materially modified, especially domestically, itremains true that the artificial distribution ofindebtedness due to the loans of the war periodwill render it difficult to set international tradefree of the restrictions which war has imposed.Even when such freedom has been obtainedthe dictates of prudence and self-restraint willintervene to prevent the countries which nowowe most, either to their own people or toforeigners, from buying as they otherwisewould. This is merely another way of sayingthat international, like domestic, credit is al-ready greatly overstrained, and that it will bethe part of wisdom not to subject it to furthersevere burdens until it has,had time to regainsome measure of normality.

One feature of readjustment during themonth of February has beent h e downward tendency inprices. Sauerbeck's index

number for February- shows a recession in Eng-land from the high point of 197, reached justbefore the armistice, to about 190, and suchdata as can be obtained for wages indicate atendency on the part of the remuneration oflabor to settle to lower levels, but in somecases to make its appearance in the abolitionof overtime, the shorter hours work beingpaid at the normal or standard rate in eachcase. Elsewhere labor has been disposed toaccept moderate readjustment of schedules ofpayment that were admittedly above normal.An automatic readjustment has been effectedin those cases where large corporations havebeen paying wages in part upon a profit-sharing basis or upon a basis which regulatedthe return to the laborer in accord with theamount of net earnings realized. In these in-stances the reduction of net earnings causedby heavier taxation and by lower prices arereflected in part upon the workers who carrythem in the form of loss of the higher earningswhich would have been realized had industrybeen more profitable than was actually thecase. Neither wages nor prices have as yetshown any extensive or marked recession, butsuch evidence as is available indicates a tend-ency of both in the same direction. This


196 FEDERAL RESERVE BULLETIN, MARCH 1,193 9.

tendency is also observable in foreign coun-tries, where, as in the United States, some"unrest" on the part of labor is reported inconsequence of the failure to determine thebasis on which wages and profits shall be ad-justed to the changing price level. TheBoard's reports of business conditions in vari- jous parts of the country point to the fact thatthe process of wage readjustment is provingeasier here than abroad, partly due to thestronger condition of industry and the factthat there is a much broader market for goodsin the United States than exists anywhere elseat the present time. Buying power on thepart of the mass of population is at a farhigher point in the United States than inEuropean countries. The underlying prob-lems of the situation are, however, the sameeverywhere. It is impossible to continue busi-ness indefinitely upon the lower price schedulewith expenses of production the same as thatwhich had developed out of the higher pricebasis.

Immediately before the return of the Presi-dent it was made known that,

The Industrial n a Y i n g received approval fromthe President of certain plans

which it had proposed for the readjustment ofprices, "The Industrial Board of the Depart-ment of Commerce" had been formed for thepurpose of examining into the business situationand suggesting such remedies as may be thoughtexpedient. The general conditions which haveled to the creation of this board are found inthe stagnation of business and industrial .ac-tivity and the prevalence of a very high levelof prices and living costs, while it is believedthat there exists a large but withheld buyingpower which is not being applied to the em-ployment of labor or the purchase of commodi-ties. The object of the new board is thereforethat of ascertaining what remedies for exist-ing conditions may be applied through con-sultation with leaders of industry and throughthe development of principles and methodssuited to the requirements of the case. Atsuch conferences it is intended to discuss withthese leaders of industry the general situation

Interest anddiscount rates.

in each branch of business and the develop-ment of principles which should apply to andgovern the solution of the problems as thusrecognized. It is believed that these prin-ciples and views will be readily understood bythe majority of those called into conference,and that the discussion of them will withoutmuch delay lead to general acceptance. Oneproblem to be dealt with by the board will bethat of bringing about an equitable disposal ofthe great volume of commodities now held bythe Government for later sale. Such com-modities will be placed upon the market in away that will not interfere with the orderlyproduction and marketing of goods. Thework of this industrial board will undoubtedlybe modified to some extent as necessities forthe program worked out at the conferencebetween the President and the governors ofthe States seem to require.

The month of January has witnessed no ma-terial change in the generalrates of interest and discountprevailing at Federal Reserve

Banks. The reasons for the maintenance ofstable conditions are the same as have alreadybeen set forth in former numbers of the FED-ERAL RESERVE BULLETIN and grow out of theproblems of financing the needs of the Govern-ment, which are already well known. Com-mercial rates of discount, as shown by the regu-lar reports of the Board, have been very nearlyuniform throughout the country, although thetendency has been toward rather higher ratesthan have heretofore existed. The slight up-ward movement is due to the gradual develop-ment of demand for means of financing newenterprises. There is some evidence thatliquidation is in process. This is entirely dueto natural causes and not to a change in thediscount policy of Federal Reserve BanksThere have been no noteworthy changes inFederal Reserve Bank rates. Such liquida-tion as has taken place at Federal ReserveBanks is not to be regarded as resulting fromchange in the Board's discount policy, thatpolicy being what it has been throughout therecent period of heavy Government financing.


MARCH 1, 1919. FEDEEAL RESERVE BULLETIN. 197

The heavy return movement of FederalReserve notes occurring during January andamounting in the aggregate to about $235,-000,000 has given way to a slight outflow inthe month of February, indicating the self-regulating character of Federal Reserve notecirculation in the existing circumstances. Theheavy return flow noted above is in part tobe explained by the natural liquidation whichnormally occurs at the turn of the year but inlarger measure was probably occasioned bythe return to banking channels of the con-siderable volume of notes that there is reasonto believe were hoarded during the war.

It is gratifying to observe that further prog-ress toward the development

Banking condi- * • i -i • , (1

tions abroad. of genuine banking strengthhas been made during the past

month. In the FEDERAL RESERVE BULLETINfor February reference was made to the in-creased strength of the Bank of England. Thepercentage of reserve as figured by that institu-tion, which had risen to about 20.13 per centat the close of January, had still further in-creased to 20.58 per cent on February 20. Notonly- the restriction of foreign trade, but thecontinuous effort to eliminate war paper ishaving its effect upon the credit situation inGreat Britain. Considerable reduction in theoutstanding circulation of notes probably in-dicates a condition parallel to that existing inthe United States during the period of note re-duction through which we have just been pass-ing. In France the outstanding note circulationshovrs no sign of decline, the reserve on handnow standing at 10.81 per cent, or somewhatbelow the situation at the close of 1918, when itstood at 11.29 per cent. The situation in theBank of France shows that conditions in thatcountry are more nearly static than theyare in Great Britain, the power to contractinflation and reduce loans being less positivethan is true across the channel. The foreigntrade of France has of course suffered verymuch more than has that of Great Britain, dueto the fact that some of her choicest industrial

districts were largely or wholly destroyed as aresult of war. Restoration of banking sound-ness is, however, being approached throughelimination of consumption and consequentlythrough relative cessation of purchases. Francewill approximate to her prewar conditions by aroute quite different from that of Great Brit-ain—that, namely, of domestic saving andeconomy, accompanied probably by slowerrestoration of foreign trade than will be trueof her neighbor. Of the Central Powers toolittle is as yet known to say with certainty whatdirection is being taken by banking and creditconditions. The situation in Germany andAustria will be considerably modified when theyare again placed in immediate communicationwith the outside world. Meanwhile, it may begenerally said that throughout the Europeancountries there is much evidence of concern asto the parity of inflated banking and currency,with a disposition to limit foreign trade to whatis necessary or "essential" to industry, get-back to a basis of adequate reserve relation-ships, and thus to approach the time when in-ternational trade can be entirely relieved of i£srestrictions. This is genuine progress towardtrue readjustment, even though in some casesit may seem to be of a negative character.

The following figures form the latest availabledata with reference to banking reserve andliabilities in some of the principal countries:

[In thousands of dollars.]

i Ratio of

Datehind t£n | to gold

and silveron hand.

Per cent.Bank of England | Feb. 5,1919Bank of France.. ; Feb. 6,1919German Reichs- !

bank : Dec. 31,1918A astro- Hunga- ' do

rian Bank. \

543,116 3,160,600:35.280,700!

64,59811,446,806;48;7l3,207|6.43

.0064

1 Bank of England data.2 Currency note account.8 Exclusive of war lean bank notes (Darlehenskassenscheine) in cir-

culation.* Including SI,502,954,000 of interest-bearing scrip (Kassenscheine)

issued to the Government and payable, after 3 and 6 months,presuma-bly in banknotes.


198 FEDERAL, RESERVE BULLETIN. MARCH 1,1919.

Gold situation.

The growing interest in the possibility of aninternational gold clearancefund, especially since the report

of the Federal Reserve Board for the year 1918,recalls earlier efforts in this direction made bythe International High Commission. This body,established by the Governments of AmericanRepublics, and consisting of national sections,each of nine jurists or financiers with the Min-ister of Finance as chairman, had from the out-set the task of bringing about more stable finan-cial relations between Latin America and theUnited States, especially through the establish-ment of the gold standard, or gold exchangestandard wherever not in effect. Study of thisproblem led to the conviction that two stepswould greatly facilitate the eventual extensionof substantial assistance by the United Statesto those Republics of Latin America whichwere in need of help to set their currency sys-tems on a firm basis, first, the use of an inter-national clearance fund, and, secondly, the useof a money account. The executive council ofthe commission prepared in the early summerof 1916 a draft of a convention, with a view toprovide for the inviolability of such a'fund. Thedraft and explanatory memoranda were in duecourse submitted to the Ministers of Financeand to the diplomatic officers of the Republicsparticipating in the work of the commission.After earful consideration the governments ofseven countries have expressed a willingness toconclude the convention with the UnitedStates, and the matter is the subject of seriousstudy in other countries.

Since the last issue of the BULLETIN, inwhich were published summaries of the workof other committees which had studied condi-tions in the gold-mining industry, the report ofthe committee appointed by Secretary of theTreasury McAdoo to make an investigation,with a view to definitely ascertaining the diffi-culties confronting gold production and sub-mitting suggestions of methods of relief, hasfiled a report with the Secretary of the Treasuryunder date of February 11, printed elsewherein this issue.

During the month ending February 10 thenet outward movement of gold

Gold imports w a g $2,125,000, as comparedand exports. .... . , t *

with a net outward movementof $93,000 for the month ending January 10.

Gold imports for the month amounting to$1,925,000 came largely from Canada, Mexico,and Nicaragua, while gold exports totaling$4,050,000 were consigned chiefly to Colombia,Venezuela, and Mexico.

The gain in the country's stock of gold sinceAugust 1, 1914, was $1,069,451,000 as maybeseen from the following exhibit:

[In thousands of dollars; i. e., 000 omitted.]

Imports.

Aug. 1 to Dec. 31,1914 ! 23,253Jan. 1 to Dec. 31,1915 1 451,955Jan. 1 to Dec. 31,1916 1 685,745Jan. 1 to Dec. 31,1917 ! 553,713Jan. 1 to Dec. 31,1918 i 61,950Jan. l t o F c b . 10,1919 1 2,636

Total jl,779,252

Exports.

104,97231,426

155,793372,17140,8484,591

importsover

exports.

181,719420,529529,952181,54221,10211,955

709,801 1,069,451

1 Excess of exports over imports.

Issues of two additional series of TreasuryOperations of certificates aggregating over

the Federal Re- 1,300 million dollars and theserve Banks. redemption by the Governmenton January 30 of the outstanding balance ofcertificates of the October 1, 1918, series are theprincipal Government operations affecting thecondition of the Federal Reserve Banks duringthe period between January 24 and February20. Holdings of war paper, which declinednearly 140 millions during the week endingJanuary 31, show an increase of over 245 mil-lions for the two weeks following, the total of1,603 millions held on February 14 being thelargest ever reported. Since then a decrease of6.5 millions is shown, the final figures for Febru-ary 20 indicating a net gain of less than 100 mil-lions for the four weeks under review. All thebanks, except those at St. Louis and Minne-apolis, report increases in the amounts of warpaper on hand. For the New York bank thenet increase for the period was 43.5 millions, for


MARCH 1,1919. FEDERAL. RESERVE BULLETIN, 199

the Boston bank 20.2 millions, and for theChicago bank 16.6 millions. Other discountson hand declined from 264.5 to 222 millions.As a result the share of war paper in the totaldiscounts on hand shows a rise from 85 to about88 per cent. For the eastern banks this ratiois in excess of 90 per cent.

Aggregate holdings of acceptances show afurther decline from 284.5 to 269.9 millions.Moreover, interbank sales have caused someredistribution in the holdings of this class ofpaper, with the result that both Cleveland andSan Francisco report larger amounts of ac-ceptances on hand than New York.

No appreciable change is shown in theamounts of Government securities held, byfar the larger share of these obligations repre-senting 1-year 2 per cent certificates depositedwith the Treasury to secure Federal Reservebank notes in circulation. Total earning assetsincreased 41.1 millions, and on February 21stood at 2,263.6 millions.

For the period under review the banks in-creased their gold holdings from 2,101.3 to2,125 millions and their net deposits from1,679.5 to 1,730.8 millions. There was nofurther increase in the volume of FederalReserve notes in circulation, increases incirculation during the first two weeks inFebruary being followed by a slight declinefor the last w eek under review. Aggregateliabilities of the banks on Federal Reservebank notes in circulation show a slow thoughcontinuous increase from 126.8 to 133.5 mil-lions. No material change in the banks'reserve percentage is shown, the gain inreserves proving sufficient to counterbalancethe increase in deposit liabilities. On Feb-ruary 21 this percentage stood at 52.2, asagainst 52.3 per cent on January 21.

In the following table are shown the changesbetween January 24 and February 20, 1919,in the total discounted and purchased billsheld by each of the Federal Reserve Banks,as well as changes between the two dates inthe holdings of other classes of investments:

[000 omitted.]

Federal Reserve Bank.

BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan Francisco

TotalUnited States long-term securi-

tiesUnited States short-term secur-

itiesAll other earning assets

Total investments held...

Jan.24.

S144.866803,942190,454144,552103,28989,134

204,22367,79139,76085,28451,327

121,950

2,046,572

28,571

147,3984

2,222,545

Feb. 20.

$158,022795,680191,644164,197103,04283,185

206,07171,59451,01681,17852,718

130,027

2,088,374

28,095

147,1234

2,263,596

Net in- | Net de-crease, j crease.

$13,156

1,19019,645

1,8483,803

11,256

1,3918,077

41,802

41,051

$8,262

2475,949

4,106

476

275

For the period between January 17 and Feb-ruary 14 weekly reports of

i D ^ i S t a . O f member b a n k s i n a b o u t 100selected cities, including all the

cities in which Federal Reserve Banks and theirbranches are located, indicate a reduction from825.6 to 723.7 millions in their holdings ofUnited States bonds, other than circulationbonds, and an increase from 1,467 to 1,743millions in their holdings of Treasury certifi-cates. Decreases in United States bonds onhand apparently reflect to some extent amountsplaced with subscribing customers upon receiptof partial payments. Since October 25 of thepast year when a maximum of 1,018.4 millionsof these bonds were shown among the assets ofreporting banks, the total has declined by 294.7millions. Meanwhile the amount of Treasurycertificates held by reporting banks, as theresult of the successive issues of these certifi-cates both in anticipation of the fifth warloan and tax payments, has gone up 793.6millions, indicating a net increase of directinvestments in Government war securities ofslightly less than 500 millions.

Loans secured by United States war obliga-tions show a decrease for the four weeks from1,182.7 to 1,170 millions. Since October 25,1918, but little change in this item is noted.Aggregate holdings of United States war securi-



ties and war paper on February 14 were 3,636.7millions and constituted 26 per cent of the totalloans and investments of all reporting banks,as against 25.1 per cent shown four weeks earlierand 22.3 per cent on October 25, the Fridayfollowing the closing of the fourth war loan.

On February 14 member banks in New YorkCity report 1,593.9 millions of United Stateswar securities and war paper, or 43.8 per centof the total shown for all reporting banks, asagainst 45.3 per cent shown four weeks earlier.Member banks in all the 12 Federal .Reservecities show corresponding holdings of 2,546.8millions, or about 70 per cent of the total forall reporting banks, as against 71 per centfour weeks previous.

During the period under review Governmentdeposits fluctuated between 489.4 millions onJanuary 24 and 693.7 millions the followingweek, the February 14 total of 644.5 millions be-ing 14.5 millions below the corresponding Janu-ary 17 figure. Larger concentration of these de-posits in New York City is noticed, memberbanks in that city reporting an increase from225.4 to 307.4 millions. Other demand depositsshow a continuous decline to February 7 from10,080 to 9,787 millions. At the end of the fol-lowing week the total stood at 9,911.7 millions,a decline of 168.3 millions since January 17,largely at the New York banks. Time depositsshow an increase from 1,605 to 1,624 millions.

Reserve balances with the Federal ReserveBanks at the end of the four weeks were uni-formly lower than at the beginning of theperiod. For all reporting banks a decreasefrom 1,298.9 to 1,255.4 millions is shown, whilefor the banks in the 12 Federal Reserve citiesan even larger decline from 979.4 to 929.2 mil-lions is noted. A similar decline is shown forcash in vault, the February 14 total of 361.1millions being 25.5 millions less than the totalreported at the close of the initial week.

The stated quarterly meeting of the FederalAdvisory Council occurred onFebruary 17 and 18, in Wash-ington, all members being pres-

ent. Several important topics of discussionwere presented and discussed by the council.

A general and growing appreciation of the use-fulness of the Federal Reserve sj^stem had beenfound by the members to exist in the severaldistricts, and it was reported that the systemenjoyed a high degree of confidence not onlyfor what it had already accomplished but as abasis for sound banking in time of peace.Among specific suggestions made by thecouncil were the recommendation that col-lections be made hj the most direct andexpeditious route, that member banks7 col-lateral notes be allowed to run for 90 daysinstead of for 15 days only during the furthercontinuance of Government war financing, andthat immediate credit be given in members'reserve accounts for bank acceptances paid toany Federal Reserve Bank. The council re-ported that the acceptance market is develop-ing satisfactorily notwithstanding the retarda-tion due to the short-time financing of theGovernment. In this same connection it wassuggested that section 5202 of the nationalbank act be amended so as to exclude fromits prohibitions the liability created by nationalbanks as an indorser on bills owned by thebank and rediscounted at home or abroad.General discussion of the conditions underwhich Government's obligations could bestbe marketed resulted in expressions of opinionon various topics relating to the technique ofthe issue as well as to the conditions underwhich paper secured by Government obliga-tions ma}^ be rediscounted at Federal ReserveBanks. As to this point the council said"Until the Liberty bonds already issued andthe Victory bonds to be issued are distributedamong permanent investors and paid for bythem, and until the banks are relieved of theobligation they are under to carry such largelines of them for their patriotic customers whohave gone in debt for them, the discountrates at the Federal Reserve Banks shouldcontinue to show some preference on loanscovered by Government securities/'

During the month of January several impor-tant changes in personnel have

sonneL gGS ** **' occurred in the Federal Reservesystem. In the Advisory Coun-

cil Mr. J. P. Morgan has been succeeded by Mr.


MARCH 1, 1919. FEDEKAL EESERVE BULLETIN". 201

A. B. Hepburn for the second district; Mr. J.W. Norwood has been succeeded by Mr. JosephG. Brown for the fifth district; Mr. J. R. Mitch-ell has been succeeded by Mr. C. T. Jaffray forthe ninth district; and Mr. Herbert Fleish-hacker has been succeeded by Mr. A. L. Millsfor the twelfth district. Governor Rolla Wells,of the Federal Reserve Bank of St. Louis, hasbeen succeeded by Mr. David C. Biggs. In theAtlanta district, Federal Reserve Agent M. B.Wellborn has succeeded Mr. Jos. A. McCord asgovernor of the Federal Reserve Bank of At-lanta, while Mr. McCord has become FederalReserve agent in place of Mr. Wellborn. Mr.

108597—19 3

Louis C. Adelson, formerly assistant secretaryof the Federal Reserve Board, has becomedeputy governor of the Federal Reserve Bankof Atlanta. In the New York district, Mr. R.M. Gidney, formerly assistant Federal Reserveagent, has become manager of the new branchof the Federal Reserve Bank of New York atBuffalo. Mr. George L. Harrison, formerlyassistant counsel of the Federal Reserve Board,has been appointed general counsel of theBoard in place of General Counsel MiltonC. Elliott, who has resigned to enter privatepractice. Mr. Elliott continues as consultingcounsel to the Federal Reserve Board.


202 FEDEBAL KESERVE BULLETIN. MARCH 1,1910.

BUSINESS CONDITIONS IN FEBRUARY, 1919.

While progress in the readjustment of busi-ness to peace conditions is reported by theBoard's representatives in the several districtsto have been made during the month of Feb-ruary, and while the advance in different partsof the country is reported generally gratifying,some uneasiness is expressed by the public atlarge because the progress is not more rapid.Although the readjustment process is still farfrom having reached completion, there is muchevidence that the factors which must be reck-oned with in bringing about the desiredreorganization of business and financial rela-tionships are cooperating in a fairly satis-factory way. "Although business is by nomeans on a settled basis/' reports the FirstFederal Reserve District, "confidence is ap-parently returning." In the Third District theprocess of readjustment "has made some prog-ress/' while elsewhere in spite of some difficultconditions approach to a settled status hasbeen distinctly marked. In the Seventh Dis-trict it is observed that "both labor and capi-tal are cooperating to continue the orderlyreadjustment now under way." This generalsituation establishes a favorable basis uponwhich to build the processes of modificationand alteration that are now at work in variousfields of effort.

Labor and employment conditions eversince the signing of the armistice with Ger-many have been regarded as constitutingthe fundamental problem of business read-justment and coupled with them the rein-troduction of a normal footing for prices.Reports as to labor unemployment have beennumerous in the press, but the reports ofFederal Reserve agents show that there hasprobably thus far been overanxiety and exag-geration with respect to this matter. Fromseveral of the manufacturing districts of theFederal Reserve system it is reported thatlabor conditions are far from satisfactory, andthat there is considerable unemployment; butit is also noted that the condition does not

seem to have grown worse during February.The process of absorbing unemployed labor iscertainly proceeding with some degree of suc-cess. While the existence of unemployment isadmitted by most of the Federal Reserveagents, it appears that the surplus of labor issmallest in the South and Southwest, whilein only a very few districts is it reportedthat serious labor controversies are in progress.As to wages and their readjustment to thenew conditions, the trend is by no meansuniform or decisive. In the South and South-west there are no indications of any reductionin the wage scale, while in the North and Eastemployees are demanding higher wages, not-withstanding the existence of considerableunemployment. Some revisions of wage scalesare reported from the Middle West, but thereis as yet no general revision of wages down-ward, although there are indications of atendency to let wages settle to a definite levelwhich shall without question be higher thanthat existing before the war. There has beena tendency to provide labor for a greater num-ber of persons by eliminating overtime orestablishing short time. The connection be-tween wages, prices, and costs is well recog-nized, and it is the view of manufacturers ingeneral that wages should not go down fasterthan prices. Such revisions as are occurring,therefore, are frequently parallel, wages andprices receding in like measure. The opposi-tion of labor to any reduction in wages is verygeneral and extremely positive, but in somecases it is accompanied by the modifyingstatement that cuts in wa^es must not gofurther than changes in costs of living.

The price question is inevitably of com-manding importance, not only to the employeebut also to the community as a whole. TheSecretaTy of the Treasury has called attentionin his letter to the chairman of the Ways andMeans Committee to the necessity of reducingcosts of living. Alterations have, however,proceeded only very slowly. Sauerbeck's in-



dex number for British prices shows up to Feb-ruary 15 a recession of 5-^ points from thepeak of 197, reached toward the close of the war.The general index number of the Bureau ofLabor Statistics for the period ending January31 has declined four points from the peak of206, reached during November and December,1918. The Board's analysis of the prices fur-nished by the Bureau of Labor shows that arecession of about three points has occurred inthe group of raw materials, where the indexnumber for the period ending January 31 de-clined from 198 to 195. The index numbersfor all of the subgroups included under thehead of raw materials have likewise declined.In the subgroup of mineral products thereduction has been from 182 to 177, largelydue to the decided cut in the price of copper.During the month the market for metals gen-erally has shown a sharp decline with decidedweakness at the end of the month. Lead,zinc, and copper have shown marked reces-sions, while grains, except wheat, have like-wise fallen off sharply. Prices in iron and steelare largely nominal, although tentatively quotedthe same as at the opening of the year, and thepolicy of the trade is to leave the initiative as toprice concessions to the consumer. Firm bidsfor desirable business will probably be met bymost producers.

In manufacturing, the problems of the read-justment situation are naturally more obviousthan elsewhere. One of the most difficultproblems is presented by the textile industry.In District No. 1 curtailment of woolen-millproduction is still in progress, while in DistrictNo. 3 readjustment is still proceeding andvalues are unsettled. The cotton industry iseven more directly affected. In New Englandthe cotton market is at a complete standstill,so far as the raw material is concerned, whilethe mills that are operating are running only afew days each week, and profits have been re-duced to a minimum or have disappeared. Inthe Third District demand for yarns hasreached a minimum figure and prices havedeclined sharply. Spot-cotton business is in

a complete state of stagnation, while it isestimated that the mills in both North andSouth have about a three months' supplyof raw cotton still on hand. Cancellationshave occurred in various lines, while in anumber of specialties, such as underwear,manufacturers continue to suffer from slackbusiness.

In leather and shoes, raw material is to-dayhigher than when the armistice was signed, andby some it is predicted that the price of shoeswill advance rather than decline. This has ledsome manufacturers to continue production,even though they have no orders. Leatherdealers in the Third District are reported to beoptimistic.

Iron and steel production has shown no in-crease in activity and the demand for steel isinsufficient to take the output of the mills,while equipment establishments are workingmostly on old orders. In the Pittsburgh dis-trict there has been a decrease of business, whilein Youngstown operations are about 60 per centof normal. The division of the steel industrywhich is affiliated with the railroads is practi-cally suspended. Unfilled orders of the UnitedStates Steel Corporation show a continuous de-cline from 7,379,152 tons at the close of Decem-ber to 6,684,268 tons at the close of January,the index numbers being 140 and 127, respec-tively, while pig-iron production shows a de-cline from 3,433,617 tons in December to3,302,260 tons in January, the index numbers,respectively, being 148 and 143. Steel ingotproduction has increased from 2,992,291 tonsto 3,082,427 tons, an increase of four pointsfrom 125 to 129. In view of this situation itis notable that some iron and steel men predicta period of unusual prosperity after a somewhatfurther readjustment has occurred. In coal,demand has been relatively light, due to themild winter, and consuming plants are wellequipped. This has enabled miners in somedistricts to moderate their activity, and fromOhio and Pennsylvania it is reported that someof the larger mines are operating only from oneto three days per week.


204. FEDERAL RESERVE BULLETIN. MARCH 1,1919.

In metals some drastic revisions of conditionshave occurred. Prices of lead, zinc, copper,and other nonferrous metals have fallen in anotable way, and the market has shown weak-ness. Gold mining lias improved in the Colo-rado district. Petroleum, while threatenedwith, a decline in crude, shows steady progressin the development of new wells and in the out-put. The production of copper during Januaryshows curtailment, while mining earnings werepoor and prices shrank in some cases to 16cents per pound. The large accumulation ofcopper which occurred during the latter monthsof the war has provided the larger mines withthe means of meeting the demand for manymonths to come.

Agriculturally the outlook throughout thecountry is bright. From the Southern Statescomes the report that the prospects indicate alarge cotton acreage, so much so that a deter-mined effort has been organized for the purposeof holding of? the market as much of last year'scrop as possible and for the curtailment of theplanted area by one-third. With reference towheat, the Ninth District reports that the mid-winter output has been helped by weather con-ditions, and that preparations are being madewith a view to a very large crop. The PacificCoast reports that stored stocks of grain arebeginning to move slowly, and that the generaloutlook is excellent, the soil being in good con-dition, while combined acreage of winter andspring wheat may attain record proportions.Flour milling in the Ninth District, however, issuffering from lack of orders, due in part to thefalling off in exports resulting from the shiftingof foreign demand to the Argentine and Austra-lian product. In the Tenth District there hasbeen a spurt in activity during the first sixweeks of 1919. The January production ofwheat flour for the country at large, as reportedto the United States Food Administration, was12,994,000 barrels, as compared with 11,759,000barrels in December. Cereals other than wheathave fallen in price, and in consequence somereduction in acreage may occur. Citrus fruitcrops have been damaged by unfavorable

weather in December and January, but the en-tire yield is likely to develop favorably. Com-plete returns for 1918 are now available as toprunes, raisins, and the like, the raisin crop of1918 being the largest ever recorded, with atotal value close to $19,000,000. From theSoutheast it is reported that fruit and truck cropshave been unusually remunerative, the move-ment of oranges and grapefruit being very large.

In live stock excellent crop prospects andimproved conditions are leading to large ex-pansion of business by stockmen. The TenthDistrict reports unusually heavy receiptsof cattle, fat steers ranging up to $18.40 perhundred pounds, as compared with 813.50 ayear ago. Receipts of hogs during Januaryat Kansas City were 535,000 head, or 50 percent more than in January, 1918, with, pricesat a maximum, Eeceipts at 15 principalmarkets were considerably heavier than a yearago with respect to all food animals. Thereceipts of hogs were especially large, thefigures standing at 4,603,335, as comparedwith 3,333,591 a year ago. On the other hand,figures for January for cattle and sheep showa slight falling off from the December level-

In retail trade favorable reports are general,notwithstanding disturbed conditions andreduced production in some districts. Evenfrom some of the manufacturing districts it isreported that the retail business situation isvery encouraging, with an increase in somelines of 25 per cent over 1918. In the FirstDistrict the public is purchasing freely, whilein the South and West at least fairly goodtrade is reported. In the Middle West reduc-tions of prices are noted in some quarters andbuying has not been satisfactory. Everywhereretailers themselves are purchasing from handto mouth on account of uncertain t}" of prices.This has unsettled the jobbing and wholesalingbusiness which in any case would show a normalreduction in activity at this season of theyear. There is a strong demand in manyquarters for jewelry and luxuries, includingpianos, which indicates that consumers stillhave resources for current use.


MARCH 1,1919. FEDERAL BESERVE BULLETIN. 205

Financially, conditions during the monthhave been quiet and reassuring. Interest anddiscount rates have on the whole been stable,with a tendency toward moderate decline inrates for time paper, especially paper withprime commercial names. Call money hasbeen firm, with an upward tendency reaching7 per cent on February 24. The suspension ofoperations by the money pool has had but littleif any perceptible effect upon conditions.Rates at Federal Reserve Banks have remainedpractically unchanged, with the exception ofa slight alteration at Boston. Bank opera-tions, as shown by the Board's report of bankdeposits (published in place of clearings) showa marked increase in volume, which has beenespecially pronounced in the larger centers.From the Seventh District it is reported thatbank clearings are still very large, gross bankdeposits showing decided increase. Bankingconditions in general show a condition ofgreater ease, with some accumulation of fundsat centers and a strong tendency on the partof hoarded money to return to the banks.According to some bankers' estimates, theamount of hoarded money that has been re-turned to banks since the armistice wouldaggregate $300,000,000.

Business Readjustment in the United States.

The following special reports to the FederalReserve Board have been obtained as theresult of a questionnaire sent to FederalReserve agents for the purpose of ascertainingthe extent of readjustment in the severaldistricts. The questions asked were as follows:

1. To what extent has business in the districtroad justed itself to peace conditions?

2. HOY*7 far has labor been reemploycd inpeace activities'?

3. How far have the industries of the districtreadjusted themselves to a normal basis ?

4. What changes in basic prices haveoccurred ?

5. How far has demand resumed its normalfooting ?

6. What special difficulties are being en-countered ?

7. What is the outlook for business, bothdomestic and export?

8. What is the prevailing tone of businesssentiment ?

Not all have given specific replies to the variousinquiries, but the reports so far as published aregiven as received. Lack of specific data renderedit difficult to make positive answers in all cases.

REPORTED BY DISTRICT NO. 1.

Throughout the entire district, there isevident iess apprehension regarding futureconditions. Although business is by no meanson a settled basis, confidence is apparentlyreturning, and there is more inclination toenter into future commitments.

Retailers, having been cautioned for monthsof the probable loss to those having large stockson hand during the transition, made haste in theclosing month of last year, to cancel orders, andhave since refused to commit themselves to any-thing but a da}7 to day purchase policy. Job-bers and wholesalers have followed the samecourse, with the result that manufacturers havebut few orders on their books.

In the meantime, the public has purchasedso freely that now the dealer is again cominginto the market.

The northern section of the district (Maine,New Hampshire, and Vermont), which, becauseit was devoted largely to agriculture was leastaffected by war conditions, has been littletroubled by the readjustment. Labor is beingcomparatively well employed, and business isrunning much as usual.'

The southern section, on tho other hand, ismore densely populated and given over verylargely to industrial pursuits. "During the wargreat expansion was experienced, with profitslarge and wages high. The sudden slackeningof its activities brought a drastic readjustment.The first shock of this has evidently passed, andsentiment is much more cheerful.

Labor conditions are far from satisfactoryin the manufacturing centers, and tho para-doxical condition is feeing experienced of em-ployees striking for increased wages, in aperiod of considerable unemployment. Dis-turbances have been confined largely to textilecities, Lawrence, Mass., being the storm center.

A reassuring feature is found, in the fact thatthe local labor union has refused its support,and the strike is being conducted by a radical


206 FEDERAL RESERVE BULLETIN. MAECH 1,1919.

element. It is believed that the majority ofthe employees would return to their work wereit not for fear of bodily harm from the strikers.

The general situation as regards unemploy-ment has changed but little, except that thosecenters which released many workers on wargoods, and consequently had a large surplus |of help, are being "eased" by persons leaving to jobtain employment elsewhere, or to return to itheir former homes.

Rates are lower than a month ago, although |a little strengthening is apparent from the jquotations made early in the month. The re- jstriction of business and consequent release of Iworking capital has helped subscriptions to !United States certificates of indebtedness.

Call money is quoted 5£ per cent. Timemoney is quoted 5J per cent to of per cent,with commercial paper selling as low as 5 percent. Bankers' acceptances are quoted 4 ^per cent indorsed, and 4^- per cent unindorsed.

In answer to inquiries as to the trend oftheir deposits since November 11, 1918, lettershave been received from 17 of the largest sav-ings banks located in the larger cities in thesix New England States. Without exception,these banks have had an increase in deposits.In five cases this was classed as being extraor-dinarily large; in fact, four described it asthe largest in their history. Of the other 12,6 had large and 6 had moderate increases.

In some places, especially those having aforeign population, evidences that money hasbeenlioarded are coming to light, and currencyis being deposited in the same bank wrapperas when withdrawn months ago.

The increase in deposits, however, is attrib-uted more to the high, wages being receivedand now being saved. In one manufacturingcenter, on a recent pay day, the average depositwas about 1100 as compared with $36 on acorresponding day in 1915.


Business and industry appear still to havereached only a comparatively early stage in thereadjustment to peace conditions. From prac-tically all liiiesj no matter how diverse, comesthe report that business is much curtailed.Most concerns cither continue to center effortin liquidating stocks which were on hand whenthe armistice "was signed or, where sueii liquida-tion has been practically completed, are waitingon prices and buying or producing only enoughto meet immediate requirements. Relativelyfew are purchasing or producing to anticipateeven a moderately distant future. In general,the nearer a concern is to the ultimate con-

sumer the more it has been able to achieve inthe process of liquidation and readjustment.

We have no evidence of any widespread re-duction in the hourly rate of wages in any in-dustry; in some lines there has even been anincrease since the armistice. Nevertheless, theaverage employee's weekly earnings have de-creased, due in part to the elimination of over-time. Moreover, many who had acquired a cer-tain degree of specialized skill and a proportion-ately increased earning power in industries en-gaged in war production have been thrown out ofwork by the shutting down of those industries,and, being unable to find peace-time jobs requir-ing the same type of knowledge, have been forcedto go back into the ranks of unskilled labor.

Reports indicate that the labor cost per unitmay have decreased, because of the eliminationof overtime, the weeding out of the least efficientlabor as employers find it necessary to lay offsome of their force, and the closer applicationof employees who remain and who now beginto prize their jobs more highly than they did.


During the past month the process of read-justment of industries in this district has madesome progress. There have been recessions inprices of many commodities and in anticipationof further reductions the attitude of buyershas continued to be marked by conservatism.Many producers are operating at small profitsbecause of the continuation of high manufac-turing costs and the necessity of quoting goodsat more reasonable prices. It is reported thatdealers are selling some lines of goods at lessthan the cost of production. Curtailment ofproduction has been noted and this has beenaided, in the case of many textile lines, by theunsettled labor situation.

The retail business situation continues to bevery encouraging. Compared to January therehas not been very much change, but comparedto last year the estimated increase of volumeof business runs from 18 to 25 per cent. Themild weather has resulted in a comparativelylight demand for heavyweight material. Manyof the stores are still in possession of large stocksof winter goods which they will have to carryover until next winter.-

Following is a table showing the result ofinquiries made of representative concerns in thedistrict as to industrial and business conditions.From the replies received it seems that thetransition from war work to civilian businessis proceeding satisfactorily, and inventories donot seem to be unusually large. Labor is ingreater supply in almost every line and appears


MARCH 1, 1919. FEDEBAL BESERVE BULLETIN. 207

to be less restless. The uncertainty of thefuture and the lack of satisfactory amounts oforders on hand are reflected in the small num-ber of firms reporting any anticipated construc-

tion of plants or extensive repairs. Five percent of the replying concerns consider the out-look excellent; 17 per cent, good; 20 per cent,fair; 54 per cent, uncertain; 8 per cent, poor,

Industries reporting.

A^riCv2ltui-li^)lcF-ntsAntoniol)ilos fvnc* j^fivt^

Cement, slate, and stone.Chemicals, fern 1 i z e r s,

drugs, soans, etcC o n f poison PT**7

Cotton and cotton troodsDpnartmpn*1 storp sDrv coods and fictionsI)veins?1 AYI.1* flTi'shinf

GlassGrocers and food prod-

ucts

Hai sHosiorv and. knit goods..Iron find t fslLeather, hides, and

giaxod kid . . .LinoleumLocomotives, boilers, en-

fT'PPS, CtCLumber and millwork...Machinorv, f o u n d r y

products, m a c h i n ofools etc

PaintsPaper, par,er nroduots,

and twineP G vrolA(imPotte^"Ri'bber foods

ShoesSi^vs 'acps etcTin plate and tin fans...Tobacco, cigars, etcW ire ..Waolons and worstedMiscellaneous (gummed

labels, pianos, pens)...Total

i

I3o

r

4

8/\\43•1334

1Q79

15

133

1010

2652

73Q336

103632

14

3

239

Are thequan-

tities ofmate-rials,sup-plies,and

goodsas

shownby your

lastinven-tory

largerthan

usual?

£... _.

2 -•*9

J3

313

iii

43{•x

3 • 12 9

2 i i2 ! 1

13 541

3

8 65 8

2 i 11

4

2

fi

4 5

13 19

24

i2 .•t

1 '• 9A

1 99 1

3 • a

25i

1 592

2 < 12

3 ; . . . .

114 129

Arethey

princi-pally

for warworkor ci-vilianbusi-ness?

1111

PI

,.

144

. . . I 7. 1 4

29

31

4

•.

1

121

20

4

3

334

IP79

1210

133

79

90

2

73ft3

q36

13

3

221

Havethe

pricesof yourprod-uct

beenlower

re-centlyfromthehighpricespre-vail-ing

duringthe

war?

35

61i

23293

1351

1311

23

82

179

5

3

2

d

,.

4

2

1

-.1

4

111

11

97

93

9,133i

9 46 1 49,

112

13

14S

52

1

3

93

Islabormoreabund-ant?

4334

734334333

IS7

1413

133

10

959

73

9,3

103622

13

3

225

©

1

1

11

1

1

1

1

2

19

1

5

i2

. . .

21

Islabor

1(3£ srest-less?

£

499

2

493993

33

134

67

131

n7

1591

6( j

4

11fi31224

3

147

5?

1

-f

2

3919119

1

53

85

n

42

109

11919

44

51

10

91

Summary of replies.

Isthere

ploy-ment?

4g12

59939

21

1459

1113

Q

2

83

9031

7

5

83221

11

1

186

1

91

2991

1

9

4

4

31

9,4

411

iii9

31

3

2

62

Islabormoreeffi-cient?

t31

1

311999

9

3

8715ft

51

9,5

g9

39

49

1322

2

90

i93

43991

311

10

1106

7

64

1799,

415

35fi13

12

1

142

Hastherebeenanyloweringof

wages?

1

1

2

1

1

11

1

9,

1

2

1

1

17

d

4334

6444343

2

1873

1413

19,2

99

9,4

2

3633683629

13

3

228

Areyou

payinglessfor raw

mate-rials?

&

9312

61

4

49

3

fi41

128

4

Q2

199,

43

?r9

59311

12

131

d

3

31

134

31

53132

81

46

Q9

2

g1165131

3

89

Is thesupquate?

i

5334

7444

4333

1579,

1513

8

106

R2

rt9,6331

103429,

13

3

212

d

1

41

2

i

...

3

21

1

16

Do youantici-pate

makingany

exten-sionsor re-

pairs toyourplantin thenear

futurewhichwill

neces-sitatethe

chaseof

build-ing

mate-rialsor

equip-ment?

t111

1

9

1

19,

2

19,

4

11

7

2119,

13

111

i 1

142

i4943

7494143

2

177

1411

93

98

19

59,513573621

13

2

203

Haveyou asatis-

factoryamount

oforders

onhand?

t51

1

5

3

1131

5

135

7

32

7

1

9

5414212

3

81

4

(<

o i

24 .3

2 .4 .14 .

2 .2 .

3 .

10 .61

12 .8 .

63 .

7 .7 .

193 .2 .

515 .2 .11 .6 .221 .1 .

12 .

150 jl

Outlook.

i\%^ o. . 2. . 1

L 1

. . 4

i i. . 1. . 1

[ i

. . 13

L 1. . 2. . 1

2 2

. . 1

. . 1

1 1

2 31 1

. . 3

. . 1

. . 21 1. . 1. . 1. . 1

. . 2

1 41

%

9,

. . .

2

19,9,

1

19,

3

3

16

9,1

1

1

3

21

3

. . .

48

a3

a-i9

52

21

1

9,3

2

113

12ft

43

Q3

204?

2

4

31f>12119

1

128

I

.3

1

11

14

1

1

--

19



REPORTED BY DISTRICT NO 4.

Readjustments appe&r to be progressingfairly satisfactorily. There are, however, twothings which tend to delay.

The first is the adjustment of Governmentcontracts. Many firms have been unable, asyet, to make their annual reports on account ofnot knowing in just what position they stand inregard to these contracts and, consequently, firmsinterested hesitate to make plans for the futureuntil they know, to a fair degree of certainty,what funds will be available for new projects.

Another hindrance to the resumption ofpeace time activities is the high prices. Therehave been some small recessions in prices, butthese serve to accentuate the waiting mood forthe reason that they have not been oi sufficientmagnitude to convince buyers that they havereached a level at which business will becomeactive. In fact, these slight reductions aredisturbing rather than helpful.

Unemployment of labor does not exist tosuch an extent as to elicit concern at the pres-ent time, but it is rather the fear of what willtake place if it continues and becomes general.

Overtime and bonuses are a thing of the past.Some manufacturers have discharged quite afew of the men who had been engaged on high-priced special war work, but advised them, atthe same time, that there was employment inother parts of the factory at lower wages andshorter hours. In many cases this has resultedin labor being discharged at one window andreemployed at another without causing anytrouble.

It would seem that it would be impossible tohave what is called a normal market until allcommodities are governed by the law of supplyand demand.

This district is prosperous largely as the steeland iron trade is prosperous, and so far in theseindustries the curtailment of output has notbeen such as to occasion very much concernwhen it is taken into question how largely thisindustry was given over to war work. Therehave been no drastic cuts in this line. Thereis a high output of ingots. Steel sheets are indemand for automobile makers and tin platemills are very active. Steel manufacturersmaking railway accessories report their busi-ness very dull.

It would seem that if prices could once reachsuch a level as to give confidence to buyersthe underlying basis of business is on sucha foundation that general business would beprosperous and labor fully employed.

Men of judgment and foresight generally areoptimistic as to the future, believing that whensome general line finds its bearings and com-mences activities others will soon follow.


Inquiries have been sent to all lines of busi-ness in an effort to cover the readjustment situ-ation thoroughly. The questions are statedbelow and brief summaries are given indicat-ing the tenor of different replies, together withmy own summary on each subject.

1. To what extent has business in this dis-trict readjusted itself to peace conditions ?

Answers:None.Not all.Slowly.Delayed.Very little.Twenty-five per cent.Thirty per cent.Forty per cent.Partially.Fair progress.Not yet normal but less trouble in getting goods.Being adjusted with little disturbance.Very large extent.Good.Normal.Now adiusted.0. K. "Fertilizers, interfered with by low prices of cotton.Flour and grain, uncertain on account of Food

Administration.Tobacco, remarkably well.Shoes, adjustment reasonably satisfactory.

Summary: From number and character of replies, re-adjustment is apparently proceeding with reasonablerapidity and quite as satisfactorily as could be expected.

2. How far has labor been reemployed inpeace activities ?

Answers:Many unemployed and others on short time.Very little surplus except in coal fields.Still a scarcity.Fully employed, more farm labor needed.Working full number of men.Well employed, efficiency improved.Very little unemployed.Returning men getting old positions and condi-

tions improving.All who have applied.All returning soldiers reinstated.All desiring work get it.Being absorbed in peace activities as quickly as

released.Quickly employed in peace activities and dis-

charged soldiers reinstated.Finding work.Have secured enough labor to fill up.Little or no surplus; soldiers rapidly employed.Fairly well employed; 90 per cent.More labor needed.Still scarce.


MARCH 1, 1919. FEDERAL KESERVE BULLETIN 209

Summary: Many answers coyer entire labor situationbut are given as they have an important bearing on thesubject of reemployment. Conditions are improving,reemployment seems to be proceeding satisfactorily.Coal regions only are reporting unsatisfactory conditions.

3. How far have the industries of the dis-trict readjusted themselves to a normal basis ?

Answers:Canning, prices broken and very little demand

at reduced prices.Furniture, not to any extent.Not very far, lack orders, labor unrest.Waiting.Government claims not paid, delaying return to

normal conditions.Estimates ranging from 25 to 75 per cent.Fairly well.Products declining in price, labor at unchanged

wages.Fair progress in some lines, others quite difficult.Very "rapidly..Doing nicely.Rapidly adjusting to normal.Satisfactorily.About normal.Practically normal.Apparently in normal condition.

Summary: Industrial readjustment proceeding satis-factorily, only serious complaint apparently from cottonmills, whose products have declined considerably inprice.

4. What changes in basis prices have oc-curred ?

Answers:Have declined 5 to 40 per cent, dry goods 20 to

33£ per cent.Grain, 10 to 25 per cent, except wheat.Corn decline, 25 cents per bushel.Very slight.Small.No material change.Only slight reductions.Very few changes.Some farm products show some little decline.All commodities a little lower basis.Slight decline, prices generally well maintained.Labor, very little.

Summary: Only moderate concessions in prices appar-ent, but buyers disposed to held off. anticipating furtherdeclines.

5. How far has demand resumed its normalfooting ?

Answers:Little demand for canned goods.Very little demand.Slow.Less demand for fertilizers.Demands 25 to 80 per cent or normal, building

about 50 per cent.Not yet normal.Fairly well.About normal, except building material.Normal, but orders not plentiful.Good, expecting spring trade.Shoes, behind in deliveries.

Summary: Demands would appear to.be 60 to 80 percent of normal.

106597—19 4

6. What special difficulties are being encoun-tered \

Answers:Wide, uncertain on account of Government

control.Cancellations of Government contracts.No demand for canned goods.Government cancellations, revenue legislation,

and high prices of labor.Heavy losses on goods on hand.Distrust of to-day's prices.Hesitation on account of expected decline.Waiting for lower prices.High wages of labor, taxes, and cost of materials.Public awaiting lower prices.High labor, poor railroad and steamship facilities.No reduction in overhead charges.Buyers seeking lower prices.Limited demand, buyers awaiting lower prices.Restrictions on exportations.Coal strikes and nonproduction.Cotton mills accumulating stocks.Low price of cotton.Building, difficulty in obtaining loans based on

present cost level.Summary: Waiting attitude, indisposition to make com-

mitments based on present prices.

7. What is the outlook for business, bothdomestic and export %

Answers:No export demand.Domestic poor, foreign depends on ability to ship.Grain, domestic bad, buying from hand to mouth;

export, none, prices artificial.Not encouraging.Only fair.Small volume for spring.Fair.Not encouraging now, but anticipate improve-

ment.With return of confidence, bright, both domestic

and foreign.Looks good if could only get it started.Improvement after six months.Building, anticipating improvement.Anticipate good business.Reasonably good.Good, domestic.Tobacco good; export good, if restrictions re-

moved.Very good.

Summary: General disposition not to take present diffi-culties too seriously, and improvement generally antici-pated.

8. What is the prevailing tone of businesssentiment ?

Answers:Pessimistic,Pessimistic, but our policy is "peptomistic."Depressed.Hesitating.Waiting.Not encouraging, awaiting removal of Government

restrictions.Uncertainty.Upset, difficult to say.Present gloomy; along future, optimistic.



Answe r s—continued.Pair.Hopeful, can not get worse; hope better.Cautious, conservative.Healthful, optimistic as to future.Tobacco good, others awaiting developments.Good.Good, with exception of "soreheads."Good; will soon be normal.

Summary: Making the best of present conditions andlooking for future improvement.


The transition from a war to a peace basishas up to this time caused no considerablegeneral disturbance in the Sixth Federal Re-serve District. The amount of trade has heldup fairly well, although it has not come up tothe volume expected after the signing of the jarmistice. This trade, however, has been to a jlarge extent in goods already manufactured |and in the hands of the jobbers s,nd whole- Isalers. There has been a marked slowing upin manufacturing, due to the cancellation oforders by the Government, and to the factthat orders from general trade are not forth-coming.

With the cancellation of Government orders,it is necessary for business to turn its atten-tion to general trade, and this it is doing cau-tiously. A definite and decided decline inprices all along the line is momentarily ex-pected, and manufacturers are delaying thepurchase of raw materials with this in view.Factories in some lines are operating to anextent necessary to supply immediate andcurrent demands; others have shortened theirhours, while a few have closed entirely for the jtime being. Some of the cotton mills in thedistrict are operating on full time, and whilein a few instances some employees doing nightwork have been released, revival of other linesof business has been sufficient to absorb thosewho are in need of work. The closing downof the powder plant at Nashville created abnor-mal conditions with regard to the number ofunemployed men. Many of these employees,however, were not residents of Nashville and jhave gradually drifted back to their homes. \The milling interests in that community are in !

an unsettled condition, and probably will beuntil the price of wheat is put upon a more per- imanent basis. During the past few weeks in-ventories and readjustment of stocks to meet!peace conditions have largely occupied the |time of merchants and manufacturers. Trade !.has been steady, but quiet in practically all \lines. " '

Expecting an early settling down to morenearly normal conditions, some of the largehouses are adding to their traveling forces.Automobile agencies, and many other lineswhich during the period of the war were classedas "nonessential," are again actively in thefield, reorganizing their forces, and in this waygiving employment to many of those who havebeen engaged in war work, as well as thereturning soldiers.

While it is true that some soldiers haveprobably returned to the farm, reports showthat a very small percentage of those who leftfarm work to enter the Army have returnedto the farm. It is indicated that, having be-come accustomed to crowds and being attractedby life in the Army, they are reluctant to returnt) life in the country. Many reports show thatreturning soldiers, especially colored soldiers,who have already gone to work, are not render-ing as efficient service as before they went towar.

There is a great reluctance on the part ofthose who have been engaged in war work, andreceiving higher wages than ever before, toreturn to work they were doing before the war,and to their old wages. While the cost ofliving has of course increased, this class ofworkers have been enabled to enjoy many lux-uries which they have previously not been in aposition to purchase'. In all probability wageswill not reach the level of the prewar periodfor a long time, and the general standard ofliving of these classes of workers will be higherthan before the war. On this account pricesof everyday necessities of life will remainhigher than before the beginning of the war.

Prices of meat and bread, "the two mainarticles of food, remain as high as at imy periodduring the past several months, and haveshown no indication of declining. Butter,eggs, and a few other articles have declined tosome extent, and reports indicate that lower-ing of prices of various other items of foodmay he expected.

Buying in practically all lines, not only byjobbers and retailers, but also by the ultimateconsumer, is being done in a "hand-to-mouth"manner; people are buying just what theyactually need for immediate use, and are notbuying in quantities, expecting an early lower-ing of prices. This frequent purchasing ofsmall quantities is holding the demand steadyin many lines.

The principal difficulty in this district is thelow price of cotton. Farmers are determinednot to sell cotton now in their hands for less



Hum 35 cents & pound, and coupled with thisthey have organized a powerful'movement toreduce this year's acreage planted to cotton atie.ast one-third, raising more foodstuffs andfeed, cattle, and hogs. All indications pointto a considerable reduction in cotton acreage,and the purchasing of less fertilizer.

Connected with this movement, there is afeeling of optimism and a belief that the priceof cotton will soon begin to respond; and it isfelt that as soon as cotton begins to move at asatisfactory price almost all lines of businessin these States may expect a largely increasedvolume of trade. In the meantime, however,there is a policy of "watchful waiting'' beingpursued by manufacturers, wholesalers, job-bers, and retailers.


Aside from the current rumor of a possiblegeneral building strike on April 1, there seemsto be no indications of interference by labor,through strikes, with a general business read-justment to a peace footing in this district.Both labor and capital are cooperating tocontinue the orderly readjustment now underway. Efforts are being made to give thereturning soldier employment as soon as he isreleased from military service. At the sametime care is being exercised to avert the unnec-essary throwing out of employment of thosewho were taken on during the war period, andwhere such are let out, to assist them in findingemployment in other lines now expandingtheir operations in consequence of tho with-drawal of war-production restrictions.

Careful inquiry discloses that at present thenumber of unemployed men in the SeventhFederal Reserve District is remarkably smallwhen the progress which has been made inreadjustment is considered. The country isentering the fourth month since hostilities inEurope ceased, and industry in the SeventhFederal Reserve District is able to continueoperations on a scale to maiitari labor em-ployment not far below normal at this seasonof the year. Those connected with the UnitedStates Employment Service, and the variousrelief organizations, say that the existing dis-tress in consequence of unemployment is lessthan usual at this period of tho year.

The slow recessioj'i of living costs has chockeda, tendency to force wage reductions, and thishas encouraged cooperation on the part of labororganizations in the effort to avoid strikeswherever possible.

In the Middle West the speeding up of allactivities of production for war purposes wasconfined chiefly to the normal products ofmanufacturing enterprises which could beutilized in war, rather than being directed tomaking of munitions and other strictly warmaterial. There were some very large con-tracts for munitions and other strictly warproducts made during the last six months ofactual hostilities. In many instances, how-ever, these contractors had scarcely reachedthe stage of quantity production and in somecases had not completed their plant expansionswhen the war stopped, hence the large numberof unsettled and informal claims to be passedupon b} the War Claims Board.

Sofar in Chicago and the immediate vicinitythere are reported 658 contracts on which thereare claims to be adjusted. Of this number 200are in, and approximately 75 have been passed.The amount of money represented by the facevalue of these contracts when completed isvariously estimated, but probablv approxi-mates $400,000,000 for the Ordnance Depart-ment alone, with something like $200,000,000on other classes of contracts. It does notfollow that the amount of the claims willclosely approach this total if those alreadypassed on are a fair criterion. Detroit, it isestimated, has contracts to be adjusted theface value of which aggregate upward of§100,000,000, and Indianapolis has about860,000,000. No estimate is obtainable fromMilwaukee.

Necessarily the difficult feature of this situa-tion lios in the plight of the subcontractor,the prime contractor hesitating to make pay-ment to the subcontractor until lie lias someidea of what tho Government is going to allowhim in the adjustment on his contract. Mean-while tho subcontractor, as well as the primecontractor, lias borrowed liberally at the banksto provide raw material and. to work it up.Until the Government allows those claims,the credit situation is somewhat involved.

It is expected, however, in a few days theGovernment will complete arrangements bywhich partial payment can be made by theprime contractors to subcontractors, which willrelieve the situation. While the amount is notlarge, comparatively speaking, the wide dis-tribution and the number of small concernsaffected make this an important factor becauseit restricts tho abilitv of small manufacturers

| to make definite1 peace footing.

plans for proceeding on a


212 FEDERAL RESERVE BULLETIN. MARCH 1, 1.919.

Notwithstanding this handicap the laborsituation, according to the latest statistics,shows a remarkably small number of unem-ployed. An indication of this is found in thefollowing compilation from the United StatesEmployment Service statistics from a limitednumber of representative plants:

Michigan...IndianaWisconsin..Illinois

Towns.;

5

h

| Number j N m n b e r o f Estimated, | employees.

247 I 178,806157 ; 109,013212 i 108,086558 i 295,979

surplus.

37,5008,300

12,0001940

1 This Illinois surplus represents Joliet and Rockford, the other fiveIllinois towns, including Chicago, reporting no unseasonal surpkis.

CHICAGO'S LABOS WELL EMPLOYED.

Want advertisements in the leading mediumsused by employers and those seeking employ-ment usually are a fair criterion of labor condi-tions in Chicago. It is interesting, therefore,to study some comparisons between Januaryand November. In November last there were20,625 advertisements for male and 14,506advertisements for female help in one of theleading mediums, while in January there were15,895 advertisers f or male and 18,110 for femalehelp, a decrease of 4,730 for male and an in-crease of 3,604 for female help. "Situationswanted" statistics are in agate lines, and show2,011 lines for men and 1,229 lines for womendesiring; positions in November compared with3,215 lines for men and 1,767 for women in Jan-uary, an increase of 1*204 lines on "Situationswanted" for inen and 538 lines on "Situationswanted" for women in the two months.

Uppermost in the business mind, of course,is the thought of eliminating as far as possiblethe hazard of future commitments in a periodof declining prices, but offsetting this is theexistence, especially in the Middle West, of agreatly increased buying, power, growing outof the high prices for tlie natural productsof this vast agricultural section, togetherwith the high wages received during the warperiod.

With retail stocks reported as normal orbelow, and with skilled labor at all the indus-trial centers pretty fully employed, and withlabor conciliated, apprehension of the usualdisturbing features of a general readjustmentperiod is being dispelled. Any developmentindicating that the price readjustment has

reached a point of stability, will, it is believed,turn the tide and stimulate business activityall along the line. However, that point hasnot yet been reached.

Food commodity tonnage in stock is aboutprewar normal, but dollar value is considerablylarger on account of the high prices, indicatingthat considerable readjustment remains to bedone along that line. Inability to adjust pricesgenerally is retarding the flow of merchandise.This applies with equal force to dry goods andkindred lines of Business. This hesitancyslowed down manufacturing, and while thevolume of retail business reported for Januaryand February is 30 to 45 per cent greater thanlast year and collections are good, yet manu-facturers apparently have not reached a pointwhere they feel justified in guaranteeing pricesto customers. There has been a depreciationin cotton and woolen goods during the last 60days of approximately 25 per cent. Stocks ofmerchandise are rapidly being diminished, anddepreciation in price will not seriously affectthe retailers, us stocks are comparativelysmall. Jobbers guaranteed prices for springmerchandise up to March 1, to a large extent,and purchases are being restricted to nearbymarkets. Koad sales for immediate deliveryare good.


Reports from various lines of industries indi-cate that a large percentage of employers arecooperating in furnishing employment to sol-diers and sailors who have been released.Many employers are taking them back, as wellas retaining their present force. A campaignhas been started in St. Louis with tlie slogan"Make a job for every fighter/' and this isresulting in employers giving preference to thesoldiers and sailors. Munition workers whohave been released are gradually being absorbedby other industries. However, general busi-ness has not as yet resumed such proportions asfully to absorb the present supply of labor.It is estimated that there are approximately15,000 unemployed workers in St. Louis. Inthe other centers in this district the numberseems to be very small. Those out of employ-ment seem to be mostly unskilled workmen,as there is a good demand for skilled workersin many lines. For several weeks past the St.Louis office of the United States EmploymentService has been placing an average of about800 men in jobs each week. The labor situ-


MARCH 1, 1919. FEDEEAL BESEKVE BULLETIN. 213

ation seems to be improving in this district,and with the revival of business activity it isbelieved that the surplus supply of labor will befully absorbed.

HOW FAR THE INDUSTRIES OF THE DISTRICTHAVE READJUSTED THEMSELVES.

Reports from the different industries in thisdistrict indicate that business is graduallyresuming a normal basis, but that it has notas yet been fully accomplished. Prices inmany lines have not yet declined far enoughto induce vigorous operations. However, de-clines in the prices of certain commoditieshave taken place, which has stimulated buying.In other lines merchants arc still buying onlyfor their immediate needs. With further read-justments of prices, a marked revival in busi-ness is anticipated. Iron and steel manufac-turers report that normal demands are gradu-ally filling the gap created by the cancellationof war contracts. Some report that they arenow doing practically a normal business. Thedemand for automobiles, garages, etc., is help-ing the iron and steel industry. Shoe manu-facturers are doing an active business, thoughit is not quite up to this time last year. Whole-salers and jobbers of dry goods state that theirbusiness is declining, as merchants are buyingcautious!}-, anticipating further reductions inthe prices of cotton goods. A large clothingmanufacturer states that he is drawing in hislines a little. The flour milling industry isstill considerably below normal. Business inthe electrical line is becoming more normal.Considerable improvement in the wholesalegrocery trade is apparent, as is also the casein the drug and millinery lines. Readjust-ment of the candy industry is taking placeslowly. This is also true of the lumber indus-try. One of our large manufacturers venturesthe statement that the industries in this dis-trict have readjusted themselves to the extentof about 75 per cent.

WHAT CHANGES IN BASIC PRICES HAVEOCCURRED.

Manufacturers of iron and steel products re-port that slight reductions in the basic pricesof metals have taken place, averaging about10 per cent. The price of leather remains firm.Dealers in dry goods report that there havebeen reductions in their line of from 10 to30 per cent. Electrical supply houses re-port some lowering in the prices of copper

wire and other raw materials. Wholesalegrocery houses state there has been a slightreduction in some of their articles. Drugmanufacturers report that declines have oc-curred in articles used in the manufacture ofmunitions, such as glycerin, carbolic acid, andtheir derivatives. Candy manufacturers saythat material in their line is practically as highnow as last year. Some slight reduction in theprice of paper is reported. Little change inthe price of lumber.

KOW FAR THE DEMAND HAS RESUMED ITSNORMAL FOOTING.

In the iron and steel line, leading manu-facturers estimate that the demand has re-sumed from 60 to 85 per cent of its normal

I footing. However, one large boiler manufac-| turer states: "The demand is far from its nor-mal footing. There arc many excellent in-quiries for prices, but after prices are furnishedthere is a tendency to hold back placing orders,making it difficult to obtain business/' Alarge shoe manufacturer estimates that thedemand is only about 70 per cent of normal,and another states that he expects it to benormal within 60 days. Hardware dealers re-port that their business is practically normal.A large department store also states that thedemand is normal. A large wholesaler of drygoods states that the demand for his goods hasresumed its normal footing to the extent of from60 to 70 per cent. Another dry goods housestates that the volume of business"in its com-munity is above normal or prewar average,although somewhat less than for the corres-ponding period of 1918. A large electricalmanufacturing company states that the de-mand is normal. The millinery demand has beenfavorably affected by the termination of thewar. A large wholesale drug concern statesthat its sales during January were the largestin its history. The demand for lumber is re-ported to be much below normal, and thedemand for paper is said to be about 80 per

! cent of normal.

WHAT SPECIAL DIFFICULTIES ABE BEINGENCOUNTERED.

Reports from the various lines of industriesin this district indicate that the following arethe main difficulties being encountered: (1)Tendency on the part of buyers to wait forreduced prices; (2) high cost of labor and themore or less unsettled labor conditions; (3)



marked decline in price of cotton; (4) lack ofbuilding and construction work; and (5) slowtransportation. A large Hour mill states thatpreference is given for the export of wheatinstead of flour, and this control of the exportflour trade is its special difficulty.

WHAT IS THE OUTLOOK FOR BUSINESS, BOTHDOMESTIC AND EXPORT.

Reports from practically all lines of indus-tries in this district express the belief that do-mestic business will show a healthy increasein the near future, but that its full develop-ment will be gradual. A large iron and steelmanufacturer states that domestic businesswill be good after prices have declined tonormal. A large paper company states: "Weanticipate good demand for both domestic andexport trade, because in both cases orders havebeen held up for several months, thus accu-mulating a demand." Efforts are being madein this district to develop foreign, trade, andreports indicate that the outlook is favorable.

WHAT IS THE PREVAILING TONE OF BUSINESSSENTIMENT.

The present prevailing tone of business senti-ment in this district is one of conservativeoptimism. Business men, as a rule, are lookingto the future in confidence. An iron and steelmanufacturer states that "after a general re-adjustment in price of raw materials and labor,business will be good." A boiler manufac-turer states: "The prevailing tone of businesssentiment is an element of doubt as to whatthe future holds. All manufacturers are afraidof the high cost of labor and are thereforereluctant to place an order for material, beingunable to determine whether there is going tobe an improvement or not, and are thereforeoperating conservatively." A dry goods com-pany reports: "Business sentiment in our dis-trict shows utmost confidence. Overcomingprevailing timidity only obstacle to assumptionof a good volume of business." The vicepresident of a large hardware company, who isfamiliar with trade conditions in this district,states: "Same conditions will continue for 30to 60 days."


The readjustment process is in full swingthroughout this district, with surprisingly littlevariation from ordinary and normal conditions.

The return of men in various military units andin the naval service has been slow. Many havenot yet received their discharge. The disposi-tion of employers has been to hold open theposts formerly held by men in the service, andthere has been little complaint of inability toobtain satisfactory opportunities for employ-ment. With the opening up of spring activi-ties within a very short time, the opportunity forreemploymont of these men will improve con-siderably^ and iio difficult}*- is anticipated inabsorbing them into industry and the ordinaryagricultural and business activities.

The district has been short of farm labor sincethe beginning of the war, and men fitted for thisclass of activity will be in great demand.

A powerful factor in preventing radicalchanges due to readjustment has been the factthat the district is largely agricultural and willobtain a guaranteed price on wheat and prob-ably very good prices lor their agricultural prod-ucts throughout 1919. The war has thereforebrought no curtailment in an agricultural sense,but, on the other hand, the indications all pointto a considerably increased acreage of wheat,due to the Government guaranty, and to in-creased acreages of rye and good acreages ofother grains due to a continuously active de-mand.

The chief readjustment now in progress isconfined to industrial plants that have beenlargely engaged on war orders. So far as thoseplants are concerned that were employers ofconsiderable numbers of men, they have in allcases taken steps to discount the termination ofwar contracts by providing other work to taketheir place, and while forces have been reduced,there has been no unemployment so far, andmen released from war service have found readyemployment in other lines. As an indication ofthis, there is at several points in the district atthe present time a demand for carpenters.Comparatively few men are looking for jobs.

In an industrial sense the district is in a veryhealthy condition, and there are no signs of anysharp decrease in the employment afforded bysuch concerns.

The spring outlook indicates the gradual re-sumption of building activities, which, especiallyat urban centers, have been sharply curtailed".Counties and municipalities throughout the dis-trict are planning large amounts of spring workof a public nature and will again take up numer-ous projects, involving paving, municipal con-struction, road and bridge work, drainage, etc.Readjustment conditions vrere recently given


MARCH 1, 1919. FEDERAL RESERVE BULLETIN, 215

very careful study by the mayors of the princi-pal cities and towns of Minnesota in conferencein Minneapolis, and throughout the district thedisposition is to provide for municipal commit-tees on reemployment of men in service to actin an advisory capacity with the public officialsin the handling of current problems.

The district is prosperous, and the outlook for1919 will continue to be very satisfactory, ifspring planting conditions are favorable andthe farmers enjoy a satisfactory crop year.


Transition from a war to a peace basis isunderway in the Tenth Federal Koserve Dis-trict. Generally, and in a large way, it ismaking rapid progress, although in some linesof industry the change involves intricateproblems that, in the present state of the busi-ness mind are quite difficult of solution. It isagreed that the one big problem which standsin the way of harmonious and equitable adjust-ment is how to get down from high war pricesto equitable peace prices without working un-necessary hardships or entailing undue losses.

The bank clearings of seventeen clearing-house cities of the district, considered a fairindex to the volume of business, exhibit a totalof $1,495,332,000 in January, 1919, as com-pared with $1,457,456,000 in December, 1918,and $1,389,721,000 in January, 1918, indicatinga gain of about 2.6 per cent for January, 1919,over December, and 7 per cent over Januaryof last year. While the volume of business re-flected in these figures would indicate thatbusiness is rapidly returning to normal condi-tions, an analysis of the situation disclosesthat this is largely the result of the continuedheavy movement of agricultural products andlive sotck to the markets under stimulus ofprices but little if any below the high peak ofwar prices.

Tlie mining and oil industries, the formerseriously handicapped in its efforts at readjust-ment by a slump in prices of products, contrib-uted, their share to this large volume of busi-ness. Heavy-meat packing operations and afair flour output from mills of the district alsohelped make up the total.

There are many signs to indicate a return toformer activity of those manufacturing indus-tries which were idle during the war o± else givenover to the making of war essentials, since re-strictions as to labor, fuel, and materials haveboon removed by the Government. Most ofthe present activity, however, is in filling orders

that have been on the books, many of them formonths. New orders are coming slowly, due tothe high cost of everything that enters into thecost of production. While it can be said thatthe movement of factories to peace basis is morerapid, for t'ne reason that their products aregenerally essential, it is certain that manufac-turing in this district can not reach its wontedactivity until there is a price readjustment onan equitable basis. The same condition alsoexists as to building, improvements both publicand private, road construction, railroad work,etc., all of which are retarded by high prices ofmaterials and labor. And this in the face ofthe fact that there is an increasing demand forall kinds of manufactured products, machinery,tractors, automobiles, trucks, lumber and build-ing materials of all kinds, such as would, if un-hampered, make 1919 the best year in history.

Throughout the Tenth Federal Reserve Dis-trict, however, the sentiment respecting thefuture is one of optimism. It has its foundationin the knowledge that as an agi icultural, meat-producing, mining, and oil-producing sectionthere is no limit to be placed on its resources,and that the United States will be called uponto not only supply a large portion of the foodfor Europe but to help with its products andmanufactures in the reconstruction of thebattlo-ient legions, in addition to supplying arapidly growing trade with other countries andon other continents.


The industries of the district are beingreadjusted to peace times, and the present out-look is encouraging. In some lines of tradethere is a strong tendency to defer buying andthe execution of contracts pending more set-tled market conditions. Wholesalers of everyclass of goods report that the public expect asubstantial reduction in prices, and are re-stricting their bin/ing. There seems to be noreal foundation for a considerable drop inprices. Of course, some declines are to beexpected and, in fact, are already apparent.These have occurred principally in dairyproducts and country produce. Various com-modities in the grocery line have also beenaffected, while others have shown a good ad-vance. According to our reports, the marketon foodstuffs is the only one in which theprices have been affected.

There is a feeling oi optimism as to thefuture in this district, which we mainlyattribute to very fine crop prospects. At the


216 FEDEEAL RESERVE BULLETIN. MARCH 1,1919.

present time, the outlook for a record produc-tion in small grain and foodstuffs is very en-couraging. During the past 90 days fine rainsand snows have fallen over the greater part ofthe district. This moisture has effectuallybroken the drouth of many months' duration.

The cattle industry, one of great importancein this section, is greatly improved, and welook for a further recovery as the seasonadvances.

As in other sections of the country, the laborsituation presents some problems. There isconsiderable unemployment in both skilledand unskilled lines, and we fear some disturb-ances in the way of strikes will occur. As yetno attempt has been made to reduce salaries,and until there is a decline in living costs, wedo not think any immediate attempt will bemade to cut salaries. Men discharged fromthe Army are given preference in organizations,but the end of the war found labor conditions

Sretty well adjusted, and the return of demob-ized soldiers has created quite a surplus.

This condition will be greatty improved as thespring season advances and building operationsare resumed.

At present everything points to unprece-dented activity in construction lines, as housingfacilities are badly needed, especially in thelarger cities, and with the end of the warindustries which have deferred constructionwill now get the same under way.


The principal activities of this district beingagricultural rather than industrial, readjust-ments from war to peace conditions have beenmade with slight disturbance. When the armis-tice was signed, most of the crops had beenharvested and the canning season had practi-cally ended. Contracts for many products hadbeen entered into, leaving only deliveries un-completed, most of which have now been made.Food being still essential, plans for the nextseason were entered into on practically thesame scale as those of last year, with the hopefor relief from agricultural labor shortage.

The principal war industry on the Pacificcoast was shipbuilding, and its activity is prac-tically unabated so far as steel-ship building isconcerned, except for the elimination of over-time and extra shifts and delays due to strikes.The metal trades, practically all of which wereoperating in connection with the building ofships, have likewise continued their activity.The Government has canceled contracts in this

district for 60 wooden ships of 213,000 totaltonnage, distributed as follows: Portland 29,tonnage 105,000; Seattle 2.1, tonnage 73,000;California 10, tonnage 35,000. This caused arapid decline in the industry, and if presentplans are carried out all Government work onwooden ships will be finished hj July.

Lumber production in the Pacific "Northwestwas affected by the diminished demand forshipbuilding, but has since shown improvementboth as to prices and demand, with productionconsiderably below normal. Spruce produc-tion for th"e Government air service,'with amonthly output of approximately 17,000,000feet, has been eliminated.

Petroleum was produced in California duringthe war under the supervision of the Govern-ment, but this activity has been returned to theoil companies who have been released by theGovernment from war obligations. They are,however, still operating under licenses, but pro-duction and employment are practically thesame as during the war.

The activity of the copper and mining indus-tries has been material^ reduced. The textilemanufacturers of this district did not havemany war contracts at the cessation of hostili-ties nor were they required to make any considrerable physical changes in their equipmentduring the war in order to perform the con-tracts which were awarded. Production inthese lines is practically back to normal.

The number employed in the plants buildingsteel ships has remained approximately thesame since November. A large number of per-sons who had been attracted to this industryfrom other lines of work during the war left theshipyards upon the signing of the armistice, buttheir places were almost immediately taken byworkers from the wooden-ship yards and byreturning soldiers and sailors. The presentmonth and the month of January have been thedull seasc&i in the lumber mills and loggingcamps and in the rural communities. As setout in the report of February 15, this has causedconsiderable unemployment in the PacificNorthwest and the agricultural centers, but thesurplus will be absorbed by the reopening ofthese industries within the next 30 or 60 days.In Utah about 2,500 men employed in thecopper industry have been discharged, and it isexpected that more will be released unless thecopper market improves in the near future.

Basic prices in general are assuming a slightdownward trend, although the tendency is notuniform. The most noticeable decline is seenin the case of food products but even in these


MARCH 1,1919. FEDERAL* RESERVE BULLETIN. 217

the average decrease is slight, some have esti-mated it at from 4 to 5 per cent. Seattle re-ports that prices of dairy products have re-ceded, raw milk declining from $3.70 to $3.20per hundred; condensed milk from $6.75 to $6per case; butter from 65 cents to 53 cents perpound; cream cheese from 38 cents to 27cents. On the other hand mill feed has ad-vanced from $31.50 a ton two months ago, to$45 at the present time. In Spokane millfeed has advanced about 50 per cent whileoats, hay, barley, and cereals have droppedabout 15 per cent. The prices of live stockshow a very slight increase, while packinghouse provisions have dropped from 10 to 12per cent. Beans are from 2 to 2-| cents perpound lower than during the war. Portlandreports that price recession has been notice-able since the first of the year. Variousproducts, particularly grain, have declinedonly slightly. In the month of January, foodprices in California reached their highest pointsince war was declared, following which a gen-eral downward trend was noticed. Both but-ter and egg prices have dropped to a some-what greater extent than might be consideredseasonal. On November 1 butter sold atwholesale for 60 cents per pound, on Decem-ber 28, at 67 cents and on January 25, at 45cents; it is now 55 cents. On November 9,eggs sold at wholesale for 89 cpnts per dozen,on January 15, for 66 cents, and on February19, at 38£ cents. Milk prices are stationary.Live stock prices have remained at practicallya uniform level for several months. Fancywheat hay which was quoted at $28 a ton onthe 1st of November dropped to $24 a ton onDecember 31, remaining at that level up tothe present time. Grain prices show fewfluctuations. The price of copper has fallenfrom 26 cents a few months ago to 17 centsper pound. The latest quotation on quick-silver is $90 per flask as compared with anaverage price of $117 during the year 1918.There is no change in the price of logs, butfinished lumber prices, which receded follow-ing the armistice, have now gone back to theapproximate maximum price set by the Gov-ernment during the war.

Although wholesale business is reportedgood, retailers, in anticipation of lower prices,are buying only to meet immediate needs. InCalifornia there is an increased demand forheavy agricultural implements and building

106597—19 5

hardware. The demand for lumber in thePacific Northwest from country yards is abovenormal but from the city yards, which han-dle most of the business, it is far below nor-mal. There are many inquiries from prewarmarkets for flour and lumber for export, butlack of tonnage and high rates prevent actualtransfers. Money is plentiful" and demandactive.

Unsettled labor conditions have presentedthe principal difficulty in industry for the pasttwo montlis. The strikes in Seattle, Tacoma,and the San Francisco Bay district are fullycovered in the report of February 15. Sincethat time the San Francisco Bay district ship-workers7 strike has been practically settled bythe organization of a new boilermakers7 union,5,000 of the 6,000 strikers having returned towork. The Seattle and Tacoma shipworkersare still on strike but the general labor situa-tion in those cities is much more settled.

The question of railway and ocean rates iscausing much concern to business men on thePacific coast. The lowering of ocean rateswithout a decrease in railway freight rates,which were twice increased during the war,has caused freight from the territory betweenthe Atlantic and the Mississippi to be routedto the Orient through New York rather thanthe Pacific coast ports. Importers and ex-porters express the belief that without suchbusiness it will be impossible to maintain thetrans-Pacific steamship lines.

While this is the dull season of the year inthe export and import business, much hopeis expressed for extensive foreign trade develop-ment. A number of new concerns have beenorganized for the purpose of engaging in ex-port business, and a number of eastern com-panies have sent their representatives to thePacific coast and some to the Orient for thepurpose of estimating the possibilities of for-eign trade with the idea of opening branches.Other concerns are planning to send repre-sentatives to the Orient, especially to Vladi-vostok, Shanghai, Australiasia, and the DutchEast Indies to study trade conditions.

The prevailing tone of business sentiment isone of uncertainty and apprehension as to thepossibilities of immediate business develop-ment on a peace basis, both on account ofunsettled latoi conditions and the Govern-ment's unsettled policy on the administrationof the railways.


218 FEDEEAL RESERVE BULLETIN. MARCH 1,1919.

Fifth Liberty Loan. ;

Secretary Glass, on February 13, 1919, pre- |sented to the Ways and Means Committee the jfollowing statement concerning the fifth Libertybond bill, proposed by him for financing the |fifth loan: |

In order that any of you who may not have had anopportunity to read it may be familiar with the generalconsiderations which led me to propose legislation in theform now before you as a draft of a fifth Liberty bond billI will ask you to bear with me while I read my letter ofFebruary 10 to Mr. Kitchin.

WASHINGTON, D. C,February 10, 1919.

DEAR MR. KITCHIN: NOW that the revenue bill haspassed the House I desire, in accordance with the intima-tion contained in my letter of January 15 to you and mytalk with you and Mr. Fordney, to ask the attention of theWays and Means Committee to the necessity of the im-mediate enactment of legislation amending the Libertybond acts so as to make possible the funding by a VictoryLiberty loan in the spring of the floating debt which hasbeen incurred and will be incurred up to that time. TheVictory Liberty loan could not be issued successfully, nowthat hostilities have ceased, within the limitations im-posed by existing laws.

After most careful consideration of the matter and afterreceiving and considering the views of bankers, Libertyloan workers, and others whose views are most entitled toconsideration, very reluctantly I am constrained to saythat I can not wisely determine now, in February, theterms of the bonds or other obligations which it would bewise to offer for subscription in April, when the Libertyloan campaign should probably begin. At the momentwe are in a period of readjustment. To the slackening ofindustrial and commercial activity incident to the termi-nation of active warfare has been added the usual dullnessof the winter season. The necessary and desirable con-traction of our credit structure has begun and will begreatly facilitated by the enactment of appropriate legis-lation" to permit the liquidation of claims arising underinformal Army contracts. Steps have been taken to breakthe deadlock "which had arisen growing out of the mainte-nance, nominally at least, of war prices in certain basicindustries. Upon the enactment of appropriate legisla-tion to enable the Food Administration to protect theguaranties given by the United States, I am hopeful thatit will prove possible to restore the operation of the law ofsupply and demand with respect to foodstuffs, with, as Ibelieve, a consequent reduction in the cost of living. Aperiod of rising prices and of intense industrial activitysuch as we have experienced during the past four years isalways a period of great apparent prosperity, and a periodof falling prices and of the contraction of credits is alwaysa period of depression. The retardation of the process ofreadjustment by artificial means can only increase theevils inherent in the situation. Buying will not beginand activity will not set in until the community at largeis satisfied that prices have reached bedrock. I am veryhopeful that measures now under discussion may result inthe rapid acceleration of the readjustment, and I am firmlyconvinced that if that be done America has before her anew period of great and growing prosperity. I am evensanguine enough to believe that it is within the range ofthe possible that so much may have been accomplished

on the lines above indicated before the expiration of twomonths from now that the whole situation will have beenchanged, and that we may look forward to the successfulissue of the Victory Liberty loan on terms which to-daywould seem quite impossible.

Furthermore, merely as a matter of the technique ofbond selling, it would be a fatal mistake to fix the termsof the loan so long in advance of the offering. The issuewould become stale and its attractions would have beendiscounted long before the loan campaign begins. It willbe remembered that the second Liberty bond act wasapproved as late as September 24 and the bonds wereoffered on October 1. 1917; that the third Liberty bondact was approved April 4 and the bonds offered on April 6,1918; and that the supplement to the fourth Liberty bondact was approved September 24 and the bonds offered onSeptember 28, 1918.

Therefore, and in view of the early expiration of the lifeof the present Congress and the apparent impossibility ofconvening and organizing the new Congress in time toenact further bond legislation before the Victory Libertyloan campaign begins, I reluctantly ask greater latitudein the exercise of a sound discretion as to the terms of theVictory Liberty loan than has been conferred by the Con-gress in respect to previous loans. I should be only tooglad to have the Congress share with me the responsibilityof this extraordinarily difficult determination, but, be-lieving that it would 'be a grave mistake to reach a finaldetermination at this time, I must ask authority to dealwith the matter as the situation may develop.

Holding these views, I have ventured to have preparedand I submit to you herewith, a draft of a bill to amend theLiberty bond acts and for other purposes. This bill would(1) increase the authorized issue of bonds from 820,000,000,-000 to $25,000,000,000; (2) remove the limitation as tointerest rate so far as regards bonds maturing not more than10 years from the date of issue; (3) authorize the issue ofnot to exceed §10,000,000,000 of interest-bearing, non-circulating notes having maturities from one to five years;(4) authorize the issue of bonds and notes payable at a pre-mium; (5) exempt war-savings certificates from incomesurtaxes; (6) confer authority upon the Secretary of theTreasury to determine the exemptions from taxation inrespect to future issues of bonds and notes and to enlargethe exemptions of existing Liberty bonds in the hands ofsubscribers for new bonds and notes; (7) exempt fromincome surtaxes and profits taxes all issues of Liberty bondsand bonds of the War Finance Corporation held abroad;(8) extend the period for conversion of 4 per cent Libertybonds on the lines suggested in my letter of January 15 toyou; (9) create a 2 | per cent cumulative sinking fund forthe retirement of the war debt; (10) continue the existingauthority for the purchase of obligations of foreign govern-ments after the termination of the war in accordance withthe views expressed by Secretary McAdoo by letter andin his testimony before the Ways and Means Committee;and (11) extend the authority of the War Finance Corpora-tion so as to permit it to make loans in aid of our commerce,thus supplementing the aid which may be given by theTreasury on direct loans to foreign governments and in ameasure relieving the Treasury of demands for such loans.

I am sure that your committee will wish to discuss all ofthese matters fully with me, and I shall not burden you atthis time with a fuller statement of my views concerningthem.

I am sending a copy of this letter to Senator Simmons.Very truly, yours,

(Signed) CARTER GLASS.

On the date the armistice was signed the United Stateswas in the fortunate position of having outstanding no


MARCH 1, 1919. FEDERAL EESEKVE BULLETIN. 219

short-time indebtedness, excluding war saving certificates,that was not covered and more than covered by the de-ferred installments on subscriptions for the bonds of thefourth Liberty loan. But expenditures in November,December, and January, according to the Treasury dailystatement, exclusive of transactions in the principal ofthe public debt, amounted to §5,958,576,114.24, or at therate of nearly $2,000,000,000 a month, and the amount ofTreasury certificates of indebtedness outstanding onJanuary 31 was $4,798,064,800, of which 83,225,099,500were issued in anticipation of the Victory Liberty loan.Expenditures for the first seven months of the fiscal yearending June 30, 1919, exclusive of the principal of thepublic debt amounted to $12,594,498,537.96. It is appar-ent that unless there should be a very radical reduction inexpenditures during the last five months of the currentfiscal year Secretary McAdoo's hope that the expendituresfor the whole fiscal year would be in the neighborhood ofonly $18,000,000,000 must be disappointed. I have notas yet been able to obtain revised estimates from the WarDepartment and other departments of the Government oftheir probable expenditures. The cash disbursementsduring the first ten days of the current month of Februaryhave shown a gratifying decrease, but the knowledge thatheavy payments on the settlement of informal Army con-tracts are being held in abeyance awaiting the enactmentof appropriate legislation and that protracted discussionconcerning the terms of peace will necessitate the con-tinuance of large military expenditures abroad; the con-tinuance of large expenditures by the Shipping Board;the Navy program, and the guaranties and commitmentsof the Food Administration prevent me from lookingforward to any great reduction in cash disbursements inthe early future.

With these things before us and with a floating debt ofnearly $5,000,000,000, increasing at the rate of, say,§1,400,000,000 a month, you will, I know, not be surprisedby my recommendation of an increase in the authorizedamount of bonds.

The amount of bonds authorized and unissued underexisting Liberty bond acts is slightly in excess of$5,000,000,000; the authorization under the first bond acthaving been $2,000,000,000, and under the second, third,and fourth acts §20,000,000,000, and approximately$17,000,000,000 of bonds having been issued under thefour acts. I t is needless to say that the Treasury doesnot contemplate the issue in connection with the Vic-tory Liberty loan of any such amount of bonds as $10,000,-000,000. It has, however, been the practice of theTreasury since the second Liberty loan to allot the entireamount of bonds subscribed for. In order to be in a posi-tion to do this in connection with the Victory Liberty loanif it should then be thought wise to follow that policy, it isnecessary to authorize some increase in the amount ofbonds authorized to be issued. In making the change itseemed wise to suggest an increase to a figure which, so faras at present information is available, would seem torepresent the maximum possible amount of the bondeddebt growing out of the war.

Not in addition to but as an alternative of the issue ofsuch bonds I have suggested the authorization of an issueof notes limited to 810,000,000,000, and I should like tosuggest also an increase in the maximum amount ofTreasury certificates from $8,000,000,000 to §10,000,000,000.It can not be too plainly stated that these three items of$10,000,000,000 each are not cumulative. It is contem-plated merely that authority should be given to theTreasury to finance the existing and expected indebted-ness either by the issue of Treasury certificates or by theissue of notes or by the issue of bonds, i t may be desir-able to adopt all of these methods in succession. It maybe desirable to issue Treasury certificates in the firstinstance and bonds to refund them, as has been done inthe past. It may be desirable to refund the Treasurycertificates into notes and the latter ultimately into bonds.Conditions may be such that the issue of a series of notesof a shorter maturity than is indicated in section 4 of thesecond Liberty bond act as appropriate for a bond issue,but of a longer maturity than that permitted for Treasurycertificates of indebtedness, would be desirable. Con-ditions in April might be such that it would be easy andwise to issue a short-time note bearing a relatively highrate of interest and carrying with it the privilege of con-version into bonds bearing interest at a lower rate andhaving a longer maturity. This would make necessaryauthority for the issue of both the notes and the bonds tothe full amount to be raised, but, of course, would notnecessitate the existence of both as outstanding indebted-ness at any one time. On the other hand, it might bedesirable to make an alternative offer of bonds and notes,leaving the subscriber a choice between the two. Thisalso would necessitate double authorization but only onedebt.

In respect to the notes and also in respect to bonds ofa maturity of 10 years or less, I have asked authority todetermine the interest rate as the situation may develop.I am by no means convinced that conditions will be suchin April as to necessitate an increase in the interest rateover that provided in existing law to an important extentif at all, yet if I were obliged to determine now what isthe lowest rate at which I could undertake with certaintyto finance the requirements of the Government when theissue is offered in April I should be obliged to name amaximum rate much higher than that which, if develop-ments are as favorable as I expect they will be in theinterval, will, I hope, be sufficient to float the loan. Thereis not, I venture to say, a solvent banking house in Americawhich would enter into a firm obligation to-day to pur-chase in April any important amount of securities of anycharacter at any price whatever—certainly not at a pricewhich failed to make such an allowance for contingenciesin the interval as would be regarded as prohibitive by theborrower. Yet that is exactly what the Congress wouldrequire the Secretary of the Treasury to do if it were tofix the interest rate to-day. I can not undertake theresponsibility of saying now at what rate the bonds ornotes may be sold in April, and if you were to-day to fix


220 FEDERAL RESERVE BULLETIN. MARCH 1,1919,

a maximum rate such as to be sufficient in any possiblecontingency you would by that very act tend to force theadoption of that maximum rate when the loan is offered.No Liberty loan has ever been sold at a lower rate thanthe maximum fixed by the act under which it was issued.On the other hand, in the second Liberty bond act, whichwas approved nearly a year and a half ago, you conferredupon Secretary McAdoo authority to issue Treasurycertificates of indebtedness without limit as to the rateof interest, and he and I have been able to maintain therate of 4J per cent for such certificates during a full year,including the period when our war prospects were at theirdarkest and the recent period when the cessation of hos-tilities has made the problem of selling Governmentsecurities most difficult. The floating debt, representedby Treasury certificates now outstanding and to be issuedin the interval before the Victory Liberty loan is offered,must be refunded, and bonds or notes must be sold to anamount sufficient to accomplish this purpose. To with-hold from the Secretary of the Treasury the power toissue bonds or notes bearing such rate of interest as may benecessary to make this refunding possible might result ina catastrophe. To specify in the act the maximumamount of interest at a figure sufficient to cover all con-tingencies would be costly, because the maximum wouldsurely be taken by the public as the minimum.

I have suggested that authority be conferred upon theTreasury to issue bonds or notes payable at a premium atmaturity believing that it might be found desirable to is-sue bonds following the lines of the British national warbonds which have been issued so successfully during thepast year and a half. Payment of a slight premium atmaturity would have a number of advantages over an in-crease in the nominal interest rate: (1) it would carrywith it an inducement to saving and to the retention ofthe bonds; (2) it would tend to limit depreciation in themarket; (3) it would probably have a somewhat less in-jurious effect upon the market value of existing issues ofLiberty bonds and other securities than a flat increase inthe interest rate; and (4) it would make possible moreexact computation of the effective interest rate to beborne by the bonds or notes than is possible where bondsare issued and paid at par. A fractional semiannual in-terest payment involves infinite annoyance to bondholders, banks, and the Government itself, which wouldbe to a great extent avoided by payment of a small pre-mium only once at maturity. I do not undertake to saythat it will be found wise to issue bonds or notes payableat a premium but I do say that the Treasury should beequipped with authority to do so If that be found expe-dient.

I have asked for authority to determine the exemptionsfrom taxation to be carried by the bonds, notes, and Treas-ury certificates. Such exemptions could not be greaterthan that conferred by the Congress in the first Libertybond act. It would not be less than exemption fromState and local taxes. Within these limits I believe it is

expedient that the Treasury should have authority todetermine the exemptions. As a matter of principle, Iagree entirely with Secretary McAdoo that exemptionsfrom taxation even in respect to the Government's ownbonds are undesirable. He, however, found it necessaryas a practical matter to modify those views to meet theexigencies of the situation in connection with the fourthLiberty loan. The bonds of the second Liberty loan car-ried a higher rate of interest than those of the first, thebonds of the third carried a higher rate of interest thanthose of the second, and the bonds of the fourth carriedgreater exemptions from taxation than those of the third.That something must be done to make the bonds or notesof the Victory Liberty loan more attractive than theirpredecessors is apparent. Whether the needed attractionshould be found in increased interest rate or in additionalexemptions from taxation or by a combination of bothwould be unwise to determine now. In the discussion ofthe pending revenue bill and of the supplement to thefourth Liberty bond act Secretary McAdoo called atten-tion to the relation between income taxes and the rate ofinterest on the bonds. In his letter of June 5, 1918, toMr. Kitchin concerning the revenue bill Secretary McAdoowrote as follows:

"This brings me to another consideration of greatmoment in the Government's financial plans. I hope that:it will not be necessary further to increase the interest rateon Government bonds. The number of subscribers to thethree Liberty loans aggregate 30,000,000. The people whosubscribed are impatient of those who have not. Variousplans have been urged upon me for forcing the people tobuy Liberty bonds. The man of small means who buysa $100 bond wants his neighbor to do so, too. There is" apopular demand also for high taxes upon war profits.There is also a popular demand that all the people shouldcontribute to financing the war. There should, therefore,be a substantial increase in the normal income tax rateand a higher tax should be levied upon so-called unearnedthan on earned incomes. Income derived from Libertybonds would be exempt from this taxation, and the rela-tion between income from Liberty bonds and incomefrom other securities would be readjusted without increas-ing the rate of interest on Liberty^ bonds. It would nottax the patriotic purchasers of Liberty bonds on theirholdings, but it would weigh heavily upon the shirkerswho have not bought them. It would make the returnfrom Liberty bonds compare favorably with the returnfrom other securities. It would give the Government'sbonds an essential and necessary advantage over those ofcorporate borrowers, and would very greatly decrease therelative advantage which State and "municipal bonds nowenjoy through the total exemption which they carry. Itwould produce a gradual readjustment of the situation inthe investment markets instead of an abrupt one, as wouldbe the case if the interest rate on Liberty bonds should beincreased.

"A normal tax falls upon all alike. Therefore, as Ipointed out in my statement before the Ways and MeansCommittee last summer, there is not the same objectionto the exemption from normal income taxes as there is tothe exemption from surtaxes. A substantial increase inthe normal income tax is the soundest and surest way ofstabilizing the price of Government bonds. If we haveto increase the interest rate on Government bonds, theincreased rate may continue for 10 to 30 years and some of


MARCH 1, 1919. FEDEBAX, KESEBVE BULLETIN. 221

the bonds which we have issued will go to great premiumsnot long after the war is over. If we make the bonds atthe present rate more attractive by increasing the normaltax, then the decrease in taxation which will follow theclose of the war will automatically adjust the situation.I believe that to stabilize the price of Government bondsby first increasing and subsequently reducing the normalincome taxes, from which the holders of these bonds areexempt, is sound finance and sound economics.

"There is another feature deserving of consideration.We are asking the people to finance this war. and we areoffering them an investment paying 4-1 per cent interest.The people have responded wonderfully to this appeal.In the last Liberty loan campaign 17,000.000, approxi-mately, subscribed. There is a wide-spread feeling thatmany people who are able to do so, especially those whoare making vast profits out of the war, are not doing theirpart, either in the purchase of Liberty bonds or in the pay-ment of taxes—that they are investing in corporate stocksand bonds producing high, returns instead of in the bondsof their own Government producing reasonable returns,when the first duty of patriotism and self-protection de-mands that they shall buy Government bonds for the pro-tection of the Nation in its hour of peril.

'' There is a natural feeling among the masses of the peo-plo that taxation upon incomes and upon war profits shouldbe high enough to bring the return from corporate invest-ments more nearly on a parity with the return from Gov-ernment bonds; that the Government should not be forcedto compete for credit with war industries, which are profit-ing abnormally and which, unless restrained by the exer-cise of sound and just taxation, will constantly add to thedifficulties of the people of the United States in their effortto supply the Government at reasonable interest rateswith the credit it needs to fight successfully this war forliberty."

And on September 5, 1918, Secretary McAdoo wrote toMr. Kitchin concerning the supplement to the fourthLiberty bond bill as follows:

"The delay in the enactment of the tax bill, the factthat the rates of income surtaxes, to which the interest onLiberty bonds, except the first Liberty loan, is subject,will be higher, and the rate of normal income tax on un-earned income will be lower, than I had contemplated,materially affect the prospects of the fourth Liberty loan.

-K * -X- -X- X-

"The market price of Liberty bonds, which respondedfavorably to the suggestion of an increased normal tax,from which the bonds will be exempt by their terms, wasdepressed by the newspaper reports of a greatly increasedsurtax, to which the interest on the bonds will be subject.

•x- - K -A- -:$• -x-

"Last year I had the privilege of explaining to you andyour colleagues on the Ways and Means Committee veryfully the reasons why I advocated making the incomefrom Liberty bonds subject to income surtaxes. I stillbelieve that' that course was wise and that the argumentsadvanced in favor of it were sound. It will not do, how-ever1, to press any theory, however sound, to an extremity,and it is obvious that, as a practical matter, we can notkeep the interest rate on Government bonds stationary,or substantially so, and continue indefinitely to increasethe surtaxes, to which the income from those bonds is sub-ject, without at the same time limiting the market forLiberty bonds to those who have little or no surtaxes topay.

* * # * -X

"In order to give the numerous small holders of Libertybonds the advantage of a market upon which they maysell their bonds in case of necessity, and also to attractsubscriptions from the great number of investors of amplemeans, but not of great wealth, it will be necessary imme-diately either to increase the interest rate or to neutralizethe increased surtaxes by freeing the bonds to a limitedextent from such taxes.

-s •* * # #

" I am influenced in this determination, by the fact thatit continues necessary to sell Liberty bonds in competi-tion with billions of dollars of bonds of the United States.the various States and municipalities, which are whollyexempt from surtaxes, as well as from all forms of taxation,so that the person whose income is subject to surtaxes isapt to make a comparison of the income return from theLiberty bonds which he is asked to subscribe for, notwith the income return from corporation and other se-curities such as carry no exemption from taxation, butwith the income return from wholly exempt bonds of theUnited States and the various States and municipalities.Under the existing, state of the Constitution and laws, sucha comparison can not be avoided. In these circumstanceswe must find a middle ground between the sound viewwhich would refuse all exemptions from surtaxes and thepractical necessity of taking into account the fact that suchexemptions will in any eY,ent be gained, as surtaxes aresteadily increased, by shifting funds into governmental,State, and municipal bonds, the income from which isexempt from surtaxes as well as from normal taxes.

" In granting such exemption, I think appropriate pro-vision should be made to the end that those who subscribefor bonds of the fourth Liberty loan may, to the extent ofa specified portion of their holdings, participate in theexemption in respect.to bonds of the first Liberty loanconverted, the second Liberty loan converted and uncon-verted, and the third Liberty loan."

The considerations which led Secretary McAdoo torecommend increased exemptions from taxation in Septem-ber are more potent now. The Capital Issues Committee,which had exercised a restraining influence upon theissue of State and municipal securities, has ceased tofunction and such securities are now being issued withoutrestriction. The Treasury itself has found it necessaryto resume the sale of bonds of the Federal land banksand these must continue to be issued in increasing amountscarrying as they do exemption from all taxation. Thosewho are subject to higher rates of surtaxes will escapetaxation at those rates to a very considerable degree byinvestment in the $3,000,000,000 or 810,000,000,000 ofexisting securities carrying exemption therefrom and thenew securities of the same character continually beingoffered. They will seek also for investment more specula-tive securities carrying a very high nominal income rate.Low-rate taxable bonds have no attraction for them.

The cessation of hostilities, the discontinuance of warwork and war wages have greatly decreased the invest-ment power of the millions of patriotic Americans of smallmeans who subscribed so liberally to the second, third,and fourth Liberty loans. They will, I know, subscribeand subscribe largely to the Victory Liberty loan. Butwhether it be in their power tc subscribe as largely as they



have subscribed for bonds of other loans I do not know.In any event it is essentially in their interest that anobligation be devised which will not only be attractiveto them in the first instance but which will have suchcharacteristics as will tend to insure the maintenanceof its market price after the drive is over. I can notnow determine what those characteristics should be, butI regard it as essential that I should be free to enlarge theexemptions from taxation if, when the time comes todetermine the terms of the new issue, that should seemdesirable.

I believe it essential that in connection with the issueof the Victory Liberty loan a plan should be devisedwhich will fully protect the interests of the holders ofthe existing Liberty loan bonds. As a matter of publicpolicy it would not be wise nor right to make a gift to theholders of those bonds, but I believe it will be wise andproper to confer upon those holders of the old bonds whosubscribe to the new loan additional exemptions fromtaxation under terms and conditions and within limitationsto be determined. Such a course would not only be agreat aid to the sale of the obligations of the new loan butshould be effective to improve the market price of existingissues which has suffered from heavy liquidation due, Ibelieve, in large measure, to the changed conditionsfollowing the cessation of hostilities.

I have recommended that the holders of war-savings cer-tificates be exempt from taxation to the same extent as theholders of bonds of the first Liberty loan. These certifi-cates are of short maturity. The maximum amount whichmay be held by anyone is limited to $1,000. The interestis not payable until maturity or earlier redemption and inthe hands of holders who await the date of maturity beforecollecting their certificates will in any event thereforeescape war taxation. The effort has been and is beingmade to get the widest possible distribution of these cer-tificates among the people of the United States. I believethe loss in revenue from this exemption will be negligibleand that the conferring of the exemption will make thecertificates what they ought to be, clearly the most de-sirable security issued by the Government, for I feel en-tirely confident that the Government will not, under anyconditions which can now be foreseen, ever have to issueany security" more attractive than an obligation bearinginterest at the rate of 4 per cent per annum, compoundedquarterly, and exempt from all taxation.

I have suggested that Liberty bonds and War FinanceCorporation bonds held abroad should be exempt from alltaxation. This is an enlargement of a provision alreadyadopted by the Congress in relation to such bonds payablein foreign moneys. The early cessation of hostilities putan end to efforts to sell obligations payable in foreignmoneys before any important amount had been sold. Ibelieve substantial amounts would be invested in theUnited States Government bonds of the various Libertyloans by persons in neutral countries with which the ex-changes are now adverse to the United States if such in-

vestors could be assured of exemption from taxation in theUnited States. This would supply a number of desirablemarkets for the secondary distribution of Liberty bondsand would have a beneficial effect upon those exchangeswhich are now adverse.

As to the extension of the privilege of converting the 4per cent Liberty loan bonds into 4-J per cent bonds, I ex-pressed myself fully in my letter of January 15 to Mr.Kitchin, as follows:

"WASHINGTON, D. C, January 15, 1919.DEAR MR. KITCHIN: The total amount issued of 4 per

cent bonds of the first Liberty loan converted was $588,-318,450, of which there remain outstanding as of December31, 1918, in the hands of the public, unconverted, after de-ducting bonds purchased and retired by means of the bondpurchase fund and bonds held bv the War Finance Cor-poration, $200,680,900.

The total amount issued of 4 per cent bonds of the secondLiberty loan was S3,807,882,350, of which there remainoutstanding as of December 31, 1918, in the hands of thepublic, unconverted, after deducting bonds purchased bymeans of the bond purchase fund and bonds held by theWar Finance Corporation. 8868,999,900.

Total 4 per cent Liberty bonds outstanding as of Decem-ber 31, 1918, $1,067,680,800.

Under the terms of the contract with the holders of thesebonds the conversion privilege expired on November 9,1918, six months after it arose. Every effort was made bySecretary McAdoo to give, publicity to the fact of the con-version privilege and its approaching expiration, and thatprivilege remained open for six months. My belief is thatthose who did not avail themselves of the conversion privi-lege within the period fixed by the terms of the contractwhich the Government made with, them fall among theclass of small holders who are unaccustomed to bond in-vestments and who, on account of the very wide distribu-tion of Liberty loan bonds were not reached by generalpublicity, and could not except in the case of registeredbonds, be reached by department circular. Insistenceupon the letter of the contract will result in loss to a groupof patriotic bondholders toward whom a special duty ofconsideration exists. The United States has sufferednothing by their failure to act promptly in the exerciseof the conversion right and it is my judgment that theconversion privilege should be extended. I propose tosubmit to your committee in connection with the bond billwhich it will be necessary for me to present at an earlydate for your consideration, a provision intended to extendthe conversion privilege so that the higher rate of 4J percent shall be effective from the semiannual interest pay-ment date next succeeding the date of presentation forconversion.

I am writing this letter to you now and giving it to thepress in order that the holders of these bonds may be in-formed of my views concerning the matter.

I am sending a copy of this letter to Senator Simmons.Very truly, yours,

(Signed) CARTER GLASS.Hon. CLAUDE KITCHIN,

Chairman Committee on Ways and Means,House of Representa lives.

I believe that immediate steps should be taken to setup a sinking fund for the retirement of the war debt.I have suggested the creation of a 2-J per cent cumulativesinking fund calculated to retire the whole debt, so faras I can now estimate it, within a period of some 25 years.



A cumulative sinking fund has the advantage of makingthe amount to be set aside for the service of the debtboth on account of interest and sinking fund substantiallya permanent item at a fixed figure until the debt is retired.The maturities and redemption dates for existing Libertyloan bonds have been arranged with great wisdom andthoughtfulness by Secretary McAdoo, the bonds of thesecond loan being redeemable during the period between1927 and 1942, those of the third loan being payablein 1928, those of the fourth loan being redeemable duringthe period between 1933 and 1938, and those of the firstloan being redeemable during the period between 1932and 1947. Secretary McAdoo announced before heretired, and 1 have confirmed the announcement that the"Victory Liberty loan will be of short maturities. Assum-ing that these maturities will cover the period betweenone year after the termination of the war and the year1927 it will always be in the power of the Governmentto use the sinking fund effectively for the redemptionof bonds of the Liberty loans.

I should accompany the bill with a recommendationfor the repeal of the existing paper sinking funds had notthis recommendation been repeatedly made in the annualreports of the Secretary of the Treasury without action.

1 have with me and would like to make a part of mystatement the following:

(1) Statements showing classified receipts and disburse-ments, exclusive of the principal of the public debt,by months from March 1, 1917, to January 31, 1919, aspublished in daily Treasury statements.

(2) Memorandum concerning the existing authoriza-tions for issues of liberty bonds showing the balanceof authority under existing law.

(3) Statement showing the interest-bearing debt of theUnited States as of January 31, including the issue ofTreasury certificates which opened on January 30, thefinal figures for which were not received until a weekor 10 days later.

(4) Statement of the bonds purchased by the Treasuryfor the bond purchase fund to January 31, 1919.

(5) Statement showing the final allotment of subscrip-tions to the fourth Liberty loan corrected to February 1.

(6) Copy of the British war loan act of July 30, 1918.This latter, I think, will interest you as bearing upon

the extent of the discretion which I have asked theCongress to repose in me under the unusual circumstancesnow confronting the Treasury. Following is the authorityconferred upon the British Treasury by the Parliament:

(1) Any money required for the raising of any supplygranted to His Majesty for the service of the year endingthe thirty-first day of March, nineteen hundred andnineteen, and, in addition, of a sum not exceeding twohundred and fifty million pounds, or for the raising of anysum required for cancelling securities or treasury billsunder the powers of this act, may be raised in such manneras the Treasury think fit, and for that purpose they maycreate and issue any securities by means of which any-public loan has been raised or may be raised, or such

other securities bearing such rate of interest and subjectto such conditions as to repayment, redemption, orotherwise, as they think fit.

The bill contains two provisions designed to meet asituation which is of vital importance) both to the UnitedStates and the European allies. The first of these provi-sions authorizes loans to the allied Governments to providefor purchases in the United States for export therefrom,for expenditures in the United States in connection withsuch purchases and for the payment of interest to theUnited States, subject to two limitations—one that thecredits shall cease one year after the termination of the warand the other that the total amount advanced shall belimited to the amount remaining unexpended of the sumauthorized by previous legislation to be loaned to foreigngovernments for war purposes.

The second provision authorizes the War Finance Cor-poration to make advances under proper restrictions toexporters not to exceed at any one time the sum of$1,000,000,000.

These proposals are designed to meet partially thesituation growing out of the temporary exhaustion of theEuropean allies as regards foreign commerce and financeand out of the transition of the United States from adebtor to a creditor nation which has been brought aboutby the war.

Destruction of property by the enemy, demands onthe man power and manufacturing facilities of the nationsand the limitations imposed by shipping requirementsupon the supplies of raw materials have combined toreduce the commercial production of the European alliedcountries available for export to small proportions and atthe same time the needs of the war have compelled themto make imports on a scale far transcending anythingknown before the war.

During the years 1917 and 1918 our foreign trade showeda net balance of $6,400,000,000 (or $3,200,000,000 a year)and our trade with Great Britain, France, and Italy aloneaccounted for $6,235,000,000 of this balance. In the yearimmediately preceding the opening of the European war,i. e., the year ending June 30, 1914, our total balance oftrade was $471,000,000, and our balance with the threecountries named $337,000,000. The trade figures forGreat Britain for 1918 (up to November) show that itsexports for the year were in money values smaller and inquantity far smaller than in the preceding year, and hertotal trade for the 11 months ending November showedan excess of imports of practically $3,500,000,000.

The necessity of foreign purchases before we enteredthe war has greatly impaired the resources of the Europeanallies available to meet an adverse balance of trade, so thatto-day they can not import goods they need withoutfinancial assistance. The Treasury has insisted that, asfar as possible, this finance should be secured throughprivate channels; but the United States, before the war,was an importer of capital rather than an exporter, and it



is not to be expected that our people will adjust themselvesto the changed situation so rapidly as to make it possiblefor all, or even the greater part, of the needs of thesecountries to be met privately. Investment in foreignsecurities was practically unknown in the United Statesbefore the commencement of the European war, and thehabit is one which can not be widely extended in a shortperiod of time. Some measure of governmental aidduring the transition period is therefore necessary if we areto be able to export the food supplies and other com-modities which European allies desire to secure and whichit is to our interest to sell them.

In asking the extension of the powers of the War FinanceCorporation, it has been my thought to avail of methodsapproximating as nearly as possible to commercial prac-tice, and to enable the funds to be secured without resortto the Treasury or the issue of Liberty bonds. The WarFinance Corporation will of course, if the legislation isenacted, secure funds by the issues of its bonds to thepublic which it is already authorized to make.

I do not feel, however, that this action alone will meetthe situation. Our exporters will, of course, be liable tothe War Finance Corporation for all advances made by it,and must limit their commitments, however well securedthey may be. Moreover, in some cases our Governmentwill either directly, or in effect, be the vendor. The ma-chinery of the War Finance Corporation is not applicableto such cases. It is anticipated that substantial sales ofproperty of the United States Government now in Europeto foreign governments can be effected to the mutual ad-vantage of the governments concerned. The materialsreferred to include railroad materials and equipment, portand dock equipment, and other property of the AmericanExpeditionary Forces. Again, the Government as guar-antor of the price of wheat has a direct interest in foreignsales of wheat.

The interest payments due from the several govern-ments on their obligations held by the United States nowaggregate over $200,000,000 each half year and it is prob-able that few of the governments at the present time canmeet these payments without assistance. The require-ments for reconstruction of Belgium and northern Francecan not yet be fully determined, but it is probable thatsome of them will be such as can not be met withoutGovernment loans.

For these reasons I urgently ask the authority to broadenthe purposes for which the loans to foreign governmentsmay be made. I do not ask an increased appropriation,and it would not be my purpose to avail of the authoritywhere commercial loans or the powers of the War FinanceCorporation could, in my judgment, be used to meet therequirements. I do, however, feel very strongly thatbefore the Congress adjourns powers should be given suffi-ciently broad to enable the situation to be dealt with. Weare creditors of the European allies to the extent of over$8,000,000,000, and we have a very real interest in the

early restoration of their economic life and their ability toenter upon foreign trade. These allies include the coun-tries to which for many years the greatest volume of ourexports has flowed, and if our foreign trade is to continueand to grow, our trade with these countries must continueto be a large part of the total. Business in the UnitedStates is now hesitant and unemployment is growing.Upon the maintenance of our exports depends in a largemeasure whether this situation shall Income aggravatedor relieved.

I am convinced that exports must be greatly curtailedunless the Government for the present emergency (andonly during that emergency) lends financial aid along thelines I have indicated. I Adew with the greatest concernthe task of raising the funds needed by the Governmentduring this year, but I am nevertheless willing somewhatto increase those needs for this purpose, being satisfied thatthe resultant effects will be such, that the task as a wholewill thereby be lightened.

Authorizations for issues of Liberty bonds.

The first Liberty bond act (Apr. 24, 1917)authorized new issues of bonds of notto exceed $5,000,000,000The same act authorized the issue under

the terms of such act of the unissued bondspreviously authorized, as follows:For construction of Panama Canal (act

Aug. 5, 1909), but including the un-issued Panama Canal bonds authorizedto be issued for the nitrate plant (actJune 3, 1916), and for the ShippingBoard (act Sept. 7, 1916), the amountof issued postal-savings bonds being de-ducted from, the amount authorized,approximately 225,000,000

For extraordinary expenditures (act Mar.3, 1917) 100, 000,000

For expediting naval construction (actMar. 4, 1917) 150.. 000,000

And in addition authorized an additionalamount to provide for payment of loanof 1908-1918 63, 945,460

Total authorization under first Libertvbond act ". 5,538,945,460

First Liberty loan subscriptions allotted. 2,000,000,000Balance bonds unissued under first Lib-

erty bond act 3,538, 945,460The second Liberty bond act (Sept. 24,

1917) authorized the issue of bonds (inaddition to the 12,000,000,000 issuedunder the first Liberty bond act) not toexceed in the aggregate 7,538,945,460

and provided that of such sum $3,538,-945,460 should be in lieu of unissuedbonds authorized by the first Libertybond act.

The third Liberty bond act (Apr. 4, 1918)increased the authority for the issue ofbonds to \ 12,000,000,000

and —The fourth Liberty bond act (July 9,1918)

further increased such authority to 20,000,000,000


MARCH 1, 1919. FEDERAL EESEEVE BUMJETLTST. 225

Issues of Liberty bonds under secondLiberty bond act, and under such act asamended:

Subscriptions allotted—Second Liberty

loan '. S3. 807, 891, 900Third Liber ty

loan \ 4,176, 516, 850Fourth Liberty

loan ". 6,993,073,250-§14,977, 482, 000

Balance authority under existinglaw for issues of Liberty bonds.. 5,022, 518.000

FEBRUARY 12, 1919.

Interest-bearing debt of the United States, Jan. 81,1919.

[Preliminary figures, subject to correction.]

TitJc.

RONDS.

Consols of 1930Loan of 1925Panamas of 1916-1936Panamas of 1918-1938Panamas of 1961Conversion bondsPostal-savings bondsFirst Liberty loan of 1932-1947First Libertv loan of 1932-1947, convertedFirst Liberty loan of 1932-1947, convertedSecond Liberty loan of 1927-1942Second Liberty loan of 1927-1942, convertedThird Liberty loan of 1928Fourth Liberty loan of 1933-1938

-p t 0 Amount out-1"ace* standing.

Pr.cfJ2 '42233

TREASURY CERTIFICATES.

Certificates of indebtedness:In anticipation of Victory Liberty l o a n -

Series V. A (Dec. 5, 1918-May 6, 1919)....Series V. B (Dec. 19,1918-May 20,1919)..Series V. C (Jan. 2, 1919-June 3, 1919)....Series V. D (Jan. 16, 1919-June 17, 1919).Scries V. E (Jan. 30, 1919-Jaly 1, 1919)...

In anticipation of internal-revenue t a x e s -Tax series of 1919 (Aug. 20, 1918-July 15,

1919) '. 4Series T. (Nov. 7, 1918-Mar. 15, 1919).... 4fcSeries T. 2 (Jan. 16, 1919-June '17, 1919)..! 4-i

Fittman Act : 2"Special issues , 2-4J

8599,724,0501.18,489,900

48". 954,18025,947,40050,000.00028,894', 50011,349,960

1,413,805,200198.865,200376;129,100860,365.100

2,752.153; 4004,055;687,0506,917,000,000

17,457,365,040

4-1 |

War-savings certificates (cash receipts)....

TOTAL INTEREST-BEARING DEBT.

BondsTreasury certificatesWar-savings certificates.

613,438,000572,494,000751,684.500600,1011500687,381.500

66,811,000794,172,500297;775,000.123,008,000291,198,800

4,798,064,8001,011,609,242

17,457.365,0404,798', 064,8001,01i;609,242

23,267,039,082

DIVISION OP LOANS AND CURRENCY,February 12, 1919,

Bond purchase fund.

Bonds purchased to January 31,1919: Par amount.First Liberty loan converted 4?s $656,000Second Liberty loan 4's S63,050,000Second Liberty loan converted 4Vs 132,295,000

195,345,000Third Liberty loan 4J's 115,935,500Fourth Liberty loan 4Vs. . . . 35,000,000

Total 346,936,500

108597—19 6

Fourth Liberty loan—Final allotment of subscriptions.

[Corrected to Feb. 1, 1919.]

Federal Reserve district:Boston 8632,124,850New York 2,044,931,750Philadelphia 598,763,650Cleveland 701,909,800Richmond 352,685,200Atlanta 217,885,200Chicago 969,209,000St. Louis 295,340,250Minneapolis 242,046,050Kansas'Citv 295,951,450Dallas 1 146,090,500San Francisco. 462,250,000

Treasury 1 33,885,550

Total ., 6,993,073.2501 Includes Army subscriptions; subject to change.

Victory Liberty Loan Act,

Following is the text of the Victory LibertyLoan Act which was signed by the Presidenton March 3, 1919:

[H. B. 16136.]

AN ACT To amend the Liberty Bond Acts and the War Finance Corpo-ration Act, and for other purposes,

Be it enacted by the Senate and House of Representatives ofthe United States of America in Congress assembled, Thatthe Second Liberty Bond Act is hereby amended by add-ing thereto a new section to read as follows:

"SEC. 18. (a) That in addition to the bonds and certifi-cates of indebtedness and war-savings certificates author-ized by this Act and amendments thereto, the Secretaryof the Treasury, with the approval of the President, isauthorized to borrow from time to time on the credit ofthe United States for the purposes of this Act, and to meetpublic expenditures authorized by law, not exceeding inthe aggregate §7,000,000,000, and to issue therefor notesof the United States at not less than par in such form orforms and denomination or denominations, containing suchterms and conditions, and at such rate or rates of interest,as the Secretary of the Treasury may prescribe, and eachseries of notes so issued shall be payable at such time notless than one year nor more than five years from the dateof its issue as he may prescribe, and may be redeemablebefore maturity (at the option of the United States) inwhole or in part, upon not more than one year's nor lessthan four months' notice, and under such rules and regu-lations and during such period as he may prescribe.

"(b) The notes herein authorized may be issued in anyone or more of the following series as the Secretary ofthe Treasury may prescribe in connection with the issuethereof:

"(1) Exempt, both as to principal and interest, fromall taxation (except estate or inheritance taxes) now orhereafter imposed by the United States, any State, or anyof the possessions of the United States, or by any localtaxing authority;



1' (2) Exempt, both as to principal and interest, fromall taxation now or hereafter imposed by the UnitedStates, any State, or any of the possessions of the UnitedStates, or by any local taxing authority, except (a) estateor inheritance taxes, and (b) graduated additional incometaxes, commonly known as surtaxes, and excess-profitsand war-profits taxes, now or hereafter imposed by theUnited States, upon the income or profits of individuals,partnerships, associations, or corporations;

"(3) Exempt, both as to principal and interest, as pro-vided in paragraph (2); and with an additional exemptionfrom the taxes referred to in clause (b) of such paragraph,of the interest on an amount of such notes the principal ofwhich does not exceed $30,000, owned by any individual,partnership, association, or corporation; or

" (4) Exempt, both as to principal and interest, from alltaxation now or hereafter imposed by the United States,any State, or any of the possessions of £he United States,or by any local taxing authority, except (a) estate orinheritance taxes, and (b) all income, excess-profits, andwar-profits taxes, now or hereafter imposed by the UnitedStates, upon the income or profits of individuals, partner-ships, associations, or corporations.

"(c) If the notes authorized under this section areoffered in more than one series bearing the same date ofissue, the holder of notes of any such series shall (undersuch rules and regulations as may be prescribed by theSecretary of the Treasury) have the option of having suchnotes held by him converted at par into notes of any othersuch series offered bearing the same date of issue.

"(d) None of the notes authorized by this section shallbear the circulation privilege. The principal and interestthereof shall be payable in United States gold coin of thepresent standard of value. The word 'bond' or 'bonds'where it appears in sections 8, 9, 10, 14, and 15 of this Actas amended, and sections 3702, 3703, 3704, and 3705 of theRevised Statutes, and section 5200 of the Revised Statutesas amended, but in such sections only, shall be deemed toinclude notes issued under this section."

SEC. 2. (a) That until the expiration of five years afterthe date of the termination of the war between the UnitedStates and the German Government, as fixed by procla-mation of the President, in addition to the exemptionsprovided in section 7 of the Second Liberty Bond Act inrespect to the interest on an amount of bonds and certifi-cates, authorized by such Act and amendments thereto,the principal of which does not exceed in the aggregate§5,000, and in addition to all other exemptions provided inthe Second Liberty Bond Act or the Supplemc3nt to SecondLiberty Bond Act, the interest received on and afterJanuary 1,1919, on an amount of bonds of the First LibertyLoan converted, dated November 15,1917, May 9, 1918,or October 24, 1918, the Second Liberty Loan, convertedand unconverted, the Third Liberty Loan, and the FourthLiberty Loan, the principal of which does not exceed$30,000 in the aggregate, owned by any individual, part-nership, association, or corporation, shall be exempt from

graduated additional income taxes, commonly known assurtaxes, and excess-profits and war-profits taxes, now orhereafter imposed by the United States, upon the incomeor profits of individuals, partnerships, associations, orcorporations.

(b) In addition to the exemption provided in sub-division (a), and in addition to the other exemptionstherein referred to, the interest received on and afterJanuary 1, 1919, on any amount of the bonds thereinspecified the principal of which does not exceed $20,000in the aggregate, owned by any individual, partnership,association, or corporation, shall be exempt from the taxestherein specified: Provided, That no owner of such bondsshall be entitled to such exemption in respect to theinterest on an aggregate principal amount of such bondsexceeding three times the principal amount of notes of theVictory Liberty Loan originally subscribed for by suchowner and still owned by him at the date of his tax return.

SEC. 3. That section 5 of the Second Liberty Bond Act,as amended by section 4 of the Third Liberty Bond Act,is hereby further amended by striking out the figures"$8,000,000,000" and inserting in lieu thereof the figures"$10,000,000,000."

SEC. 4. That section 3 of the Fourth Liberty Bond Actis hereby amended to read as follows:

"SEC. 3. That, notwithstanding the provisions of theSecond Liberty Bond Act or of the War Finance Corpo-ration Act or of any other Act, bonds, notes, and certificatesof indebtedness of the LTnited States and bonds of the WarFinance Corporation shall, while beneficially owned by anonresident alien individual, or a foreign corporation,partnership, or association, not engaged in business in theUnited States, be exempt both as to principal and interestfrom any and all taxation now or hereafter imposed by theUnited States, any State, or any of the possessions of theUnited States or by any local taxing authority."

SEC. 5. That the privilege of converting 4 per centumbonds of the First Liberty Loan converted and 4 percentum bonds of the Second Liberty Loan into 4J percentum bonds, which privilege arose on May 9, 1918, andexpired on November 9, 1918, may be extended by the

| Secretary of the Treasury for such period, upon such termsand conditions and subject to such rules and regulations,as he may prescribe. For the purpose of computing theamount of interest payable, bonds presented for conversionunder any such extension shall be deemed to be convertedon the dates for the payment of the semiannual interest onthe respective bonds so presented for conversion nextsucceeding the date of such presentation.

SEC. 6. (a) That there is hereby created in the Treas-ury a cumulative sinking fund for the retirement of bondsand notes issued under the First Liberty Bond Act, theSecond Liberty Bond Act, the Third Liberty Bond Act,the Fourth Liberty Bond Act, or under this Act, andoutstanding on July 1, 1920. The sinking fund and alladditions thereto are hereby appropriated for the paymentof such bonds and notes at maturity, or for the redemption



or purchase thereof before maturity by the Secretary ofthe Treasury at such prices and upon such terms and con-ditions as he shall prescribe, and shall be available until allsuch bonds and notes are retired. The average cost of thebonds and notes purchased shall not exceed par andaccrued interest. Bonds and notes purchased, redeemed,or paid out of the sinking fund shall be canceled andretired and shall not be reissued. For the iiscal yearbeginning July 1, 1920, and for each fiscal year thereafteruntil all such bonds and notes are retired there is herebyappropriated, out of any money in the Treasury not other-wise appropriated, for the purposes of such sinking fund,an amount equal to the sum of (1) 2J per centum of theaggregate amount of such bonds and notes outstandingon July 1, 1920, less an amount equal to the par amountof any obligations of foreign governments held by theUnited States on July 1, 1920, and (2) the interest whichwould have been payable during the fiscal year for whichthe appropriation is made on the bonds and notes pur-chased., redeemed, or paid out of the sinking fund duringsuch year or in previous years.

The Secretary of the Treasury shall submit to Congressat the beginning of each regular session a separate annualreport of the action taken under the authority containedin this section.

(b) Sections 3688, 3694. 3695, and 3696 of the RevisedStatutes, and so much of section 3689 of the RevisedStatutes as provides a permanent annual appropriation of1 per centum of the entire debt of the United States to beset apart as a sinking fund, are hereby repealed.

SEC. 7. (a) That until the expiration of eighteen monthsafter the termination of the war between the United Statesand the German Government, as fixed by proclamation ofthe President, the Secretary of the Treasury, with theapproval of the President, is hereby authorized on behalfof the United States to establish, in addition to the creditsauthorized by section 2 ot the Second Liberty Bond Act,as amended, credits with the United States for any foreigngovernment now eng&ged in war with the enemies of theUnited States, for the purpose only of providing for pur-chases of any property owned directly or indirectly bythe United States, not needed by the United States, orof any wheat the price of which has been or may be guar-anteed by the United States. To the extent of the creditsso established from time to time the Secretary of theTreasury is hereby authorized to make advances to orfor the account of any such foreign government and toreceive at par from such foreign government for the amountof any such advances its obligations hereafter issuedbearing such rate or rates of interest, not less than 5 percentum per annum, maturing at such date or dates, notlater than October 15,1938, and containing such terms andconditions, as the Secretary of the Treasury may from timeto time prescribe. The Secretary, with the approval ofthe President, is hereby authorized to enter into sucharrangements from time to time with any such foreigngovernment as may be necessary or desirable for estab-

lishing such credits and for the payment of such obligationsbefore maturity.

(b) The Secretary of the Treasury is hereby authorizedfrom time to time to convert any short-time obligationsof foreign governments which may be received under theauthority of this section into long-time obligations of suchforeign governments, respectively, maturing not laterthan October 15, 1938, and in such form and terms as theSecretary of the Treasury may prescribe: but the rate orrates of interest borne by any such long-time obligationsat the time of their acquisition shall not be less than therate borne by the short-time obligations so converted intosuch long-time obligations; and, under such terms andconditions as he may from time to time prescribe, toreceive payment, on or before maturity, of any obliga-tions of such foreign governments acquired on behalf ofthe United States under authority of this section, and,with the approval of the President, to sell any of suchobligations (but not at less than par with accrued interestunless otherwise hereafter provided by law), and to applythe proceeds thereof, and any payments so received fromforeign governments on account of the principal of suchobligations, to the redemption or purchase, at not morethan par and accrued interest, of any bonds of the UnitedStates issued under the authority of the First LibertyBond Act or Second Liberty Bond Act as amended andsupplemented, and if such bonds can not be so redeemedor purchased, the Secretary of the Treasury shall redeemor purchase any other outstanding interest-bearing obliga-tions of the United States which may at such time besubject to redemption or which can be purchased at notmore than par and accrued interest.

(c) For the purposes of this section there is appropriatedthe unexpended balance of the appropriations made bysection 2 of the First Liberty Bond Act and hy section 2of the Second Liberty Bond Act as amended by the ThirdLiberty Bond Act and the Fourth Liberty Bond Act,but nothing in this section shall be deemed to prohibitthe use of such unexpended balance or any part thereoffor the purposes of section 2 of the Second Liberty BondAct, as so amended, subject to the imitations thereincontained.

SEC. 8. That the obligations of foreign governmentsacquired by the Secretary of the Treasury by virtue ofthe provisions of the First Liberty Bond Act and theSecond Liberty Bond Act, and amendments and supple-ments thereto, shall mature at such dates as shall be deter-mined by the Secretary of the Treasury: Provided, Thatsuch obligations acquired by virtue of the provisions of theFirst Liberty Bond Act, or through the conversion ofshort-time obligations acquired under such act, shallmature not later than June 15, 1947, and all other suchobligations of foreign governments shall mature not laterthan October 15, 1938.

SEC. 9. That the War Finance Corporation Act is herebyamended by adding to Title 1 thereof a new section, toread as follows:


228 FEDERAL, RESERVE BULLETIN. MARCH 1.1919.

"SEC. 21. (a) That the corporation shall be empoweredand authorized, in order to promote commerce withforeign nations through the extension of credits, to makeadvances upon such terms, not inconsistent with theprovisions of this section, as it may prescribe, for periodsnot exceeding five years from the respective dates of suchadvances:

"(1) To any person, firm, corporation, or associationengaged in the business in the United States of exportingtherefrom domestic products to foreign countries, if suchperson, firm, corporation, or association is, in the opinion ofthe board of directors of the corporation, unable to obtainfunds upon reasonable terms through banking channels.Any such advance shall be made only for the purpose ofassisting in the exportation of such products, and shall belimited in amount to not more than the contract pricetherefor, including insurance and carrying or transporta-tion charges to the foreign point of destination if and to theextent that such insurance and carrying or transOortationcharges are payable in the United States by such exporterto domestic insurers and carriers. The rate of interestcharged on any such advance shall not be less than 1 percentum per annum in excess of the rate of discount forninety-day commercial paper prevailing at the time ofsuch advance at the Federal reserve bank of the district inwhich the borrower is located; and

"(2) To any bank, banker, or trust company in theUnited States which alter this section takes effect makesan advance to any such person, firm, corporation, or asso-ciation for the purpose of assisting in the exportation ofsuch products. Any such advance shall not exceed theamount remaining unpaid of the advances made by suchbank, banker, or trust company to such person, firm,corpora.tionm or association for such purpose.

"(b) The aggregate of the advances made by the corrporation under this section remaining unpaid shall neverat any time exceed the sum of §1,000,000,000.

" (c) Notwithstanding the limitation o'i section 1 theadvances provided lor by this section may bo made untilthe expiration of one year after the termination of the wa-between the United States and the German Governmentas fixed by proclamation of the President. Any suchadvances made by the corporation shall be made upon thepromisory note or notes of the borrower, with full andadequate security in each instance by indorsement, guar-anty, or otherwise. The corporation shall retain power torequire additional security at any time. The corporationin its discretion may upon like security extend the time ofpayments of any such advance through renewals, the sub-stitution of new obligations, or otherwise, but the time forthe payment of any such, advance shall not be extendedbeyond five years from the date on which it was originallymado."

SEC. 10. That section 15 of the War Finance Corpora-tion Act is hereby amended to read as follows:

"SEC. 15. That all net earnings of the corporation notrequired for its operations shall be accumulated as a reserve

; fund until suck time as the corporation liquidates under• the terms of this title. Such reserve fund shall, upon thedirection of the board of directors, with the approve] ofthe Secretary of the Treasury, be invested in bonds and

; obligations of the United States, issued or converted afterI September 24, 1917, or upon like directions and approvalj may be deposited in member banks of the Federal ReserveI System, or in any of the Federal reserve banks, or be used: from time to time, as well as any other funds of the cor-i poration, in the purchase or redemption of any bonds issuedj by the corporation. The Federal reserve banks are hereby•• authorized to act as depositaries for and as fiscal agents of• the corporation in the general performance of the powers: conferred by this title. Beginning twelve months after* the termination of the war, the date of such terminationto be fixed by a proclamation of the President of the UnitedStates, the directors of the corporation shall proceed to•liquidate its assets and to wind up it3 affairs, but the direc-tors of the corporation, in their discretion, may, from timeto time, prior to such date, sell and dispose of any securitiesor other property acquired by the corporation. Any bal-ance remaining after the payment of all its debts shall bepaid into the Treasury of the United States as miscella-neous receipts, and thereupon the corporation shall bedissolved."

SEC. 11. That the short title of this act shall be "VictoryLiberty Loan Act."

Approved March 3, 1919.

Amendments to the Federal Reserve Act.

The bill embodying amendments to theFederal Reserve Act was signed by the Presi-dent on March 3, The text of the act follows:

(S. 5236.)

AN ACT To amend sections seven, ten, and eleven of the FederalReserve Act, and section fifty-one hundred and seventy-two, Re-vised Statutes of the United States.

Be it enacted by the Senate and House of Representatives ofthe United States of Ameirca in Congress assembled, Thatthat part of the first paragraph of section seven of the Fed-eral Reserve Act which reads as follows^ "''After the afore-said dividend claims have been fully met, all the netearnings shall be paid to the United States as a franchisetax, except that one-half of such net earnings shall be paidinto a surplus fund until it shall amount to forty per centumof the paid-in capital stock of such bank," be amended toread as follows:

"After the aforesaid dividend claims have been fullymet, the net earnings shall be paid to the United Statesas a franchise tax, except that the whole of such net earn-ings, including those for the year ending December thirty-first, nineteen hundred and eighteen, shall be paid into asurplus fund until it shall amount to one hundred percentum of the subscribed capital stock of such bank, and



that thereafter ten per centum of such net earnings shallbe paid into the surplus."

SEC. 2. That that part of section ten of the Federal Re-serve Act which reads as follows: "The members of saidboard, the Secretary of the Treasury, the Assistant Secre-taries of the Treasury, and the Comptroller of the Currencyshall be ineligible during the time they are in office andfor two years thereafter to hold any office, position, oremployment in any member bank," be amended to readas follows:

"The Secretary of the Treasury and the Comptrollerof the Currency shall be ineligible during the time theyare in office and for two years thereafter to hold any office,position, or employment in any member bank. Theappointive members of the Federal Reserve Board shallbe ineligible during the time they are in office and for twoyears thereafter to hold any office, position, or employ-ment in any member bank, except that this restrictionshall not apply to a member who has served the fuJl termfor which he was appointed."

SEC. 3. That sec Jon eleven of the Federal Reserve Actas amended by the Act of September seven, nineteenhundred and sixteen, be further amended by striking outthe whole of subsection (m) and by substituting therefor asubsection to read as follows:

"(m) Upon the affirmative vote of not less than five ofits members the Federal Reserve Board shall have powerto permit Federal Reserve Banks to discount for any mem-ber bank notes, drafts, or bills of exchange bearing thesignature or indorsement of any one borrower in excess ofthe amount permitted by section nine and section thirteenof this Act, but in no case to exceed twenty per centum ofthe member bank's capital and surplus: Provided, however,That all such notes, drafts, or bills of exchange discountedfor any member bank in excess of the amount permittedunder such sections shall be secured by not less than alike face amount of bonds or notes of the United Statesissued since April twenty-four, nineteen hundred andseventeen, or certificates of indebtedness of the UnitedStates: Provided further, That the provisions of this sub-section (m) shall not be operative after December thirty-first, nineteen hundred and twenty."

SEC. 4. That section fifty-one hundred and seventy-two, Revised Statutes of the United States, be amendedto read as follows:

"SEC. 5172. That in order to furnish suitable notes forcirculation, the Comptroller of the Currency shall, underthe direction of the Secretary of the Treasury, causeplates and dies to be engraved in the best manner toguard against counterfeiting and fraudulent alterations,and shall have printed therefrom and numbered suchquantity of circulating notes in blank or bearing engravedsignatures of officers as herein provided, of the denomina-tions of $1, $2, $5, $10, $20, $50, $100, $500, and $1,000, asmay be required to supply the associations entitled toreceive the same. Such notes shall express upon theirface that they are secured by United States bonds de-

posited with the Treasurer of the United States by thewritten or engraved signatures of the Treasurer and Regis-ter, and by the imprint of the seal of the Treasury, andshall also express upon their face the promise of theassociation receiving the same to pay on demand, attestedby the written or engraved signatures of the presidentor vice president and cashier; and shall bear such devicesand such other statements and shall be in such form asthe Secretary of the Treasury shall, by regulation, direct."

Approved March 3, 1919.

Study of Credit Barometrics.

In the following pages are given the resultsof a study of "credit barometrics'7 preparedby Mr. Alexander Wall, of the National Bankof Commerce, Detroit, Mich., at the requestof the Board, under the general supervision ofthe Division of Analysis and Research of theFederal Reserve Board. This report was firstprepared for the use of the Federal ReserveBoard and of the Federal Reserve Banks, butthe general interest in credit conditions hasled to its publication in the belief that it mayattract comment and discussion relative tothe principles presented in it. The methodspursued were originated by Mr. Wall and havebeen carried out by him. along his own lines,,subject only to general criticism and suggestion.To the Federal Reserve Board, Washington, D. C:

This report on credit barometrics will consist of severalmain divisions, the first treating the theory involved; thesecond the method of compilation in the examinationjust made; the third displaying the results of the exami-nation.

THE THEORY.

The theories lying behind the credit barometric workabout to be outlined developed from a desire to establishsome sort of indicator in credit work. Common practicehas (as far as has been made public) developed only onegeneral theory, which has become accepted as more or lessstandard. This theory is known as '' the two-for-one rule"and consists of the principle that, in order to establish agood credit proportion, the subject statement must showat least two dollars of current assets for every dollar ofcurrent liability. The reason for this measure is basiclysound, because from a credit standpoint companies mustbe looked at partially, at least, as a liquidating proposi-tion in which there is bound to be a shrinkage of assets,in that some4 accounts will be slow and bad and somemerchandise out of season and antequated, whereas thecorresponding debt is not subject to shrinkage.. These



proportions have become accepted only by commonpractice, and there is a question as to whether the two-for-one or the 200 per cent ratio is right, too large, or too little.It provides a substantial margin, and has on that accountbecome rather generally acknowledged as safe. Theestablishment of an;/ such ratio is not a matter of theory,but has been a matter of experimentation.

While the establishment of such a ratio can not be amatter of pure mathematics, there is a mathematical prin-ciple which can be evoked in the experimentation so asto arrive at a fairly definite standardization. This is thelaw of averages, and it has been applied by insuranceactuaries in different kinds of insurance, so that the extentof an individual's life, the probability of lire or accident,etc., which are not mathematical problems, have beenreduced to an almost exact science. All of this has beendone by using the law of averages as a mathematicalprinciple upon which to base the experimentation. Thepresent study is based on the adaptation of the law ofaverages in the establishing of certain measures to beused with intelligence by bank-credit men, manufac-turers, and merchants in their attempts to disclose weak-nesses in the financial structure.

It can not be definitely determined what proportion ofthe final decision in any credit risk rests entirely uponan analysis of the property statement. Different bank-credit men who have been interviewed in this connectionestimate the percentage of the entire decision that restson the statement at between 40 and 60 per cent, leavingin contra (10 to 40 per cent of the final decision restingupon the so-called moral risk, the knowledge of the creditgrantor of the ability of the management to produce eco-nomically, the moral fiber of the managers, the conditionof the plant, general business conditions, localized busi-ness conditions, and other matters of this land. Even ifonly 40 per cent of the decision rests upon an analysis ofthe statement, it still behooves the credit man and thefinancial system of the country to develop this 4.0 per centto a 100 per cent efficiency within itself, if possible, andit is with this in mind primarily that the theories in thisreport are advanced. However, as the study develops itwill be seen that by comparison the barometrics compiledwill do a great deal toward uncovering sectional and typetrade conditions that may be unsound or top-heavy.

The adoption of the current ratio theory is in itself purelya qualitative proposition, in which the current assets inbulk are measured against the current liabilities in bulk.It is quite as important, however, that a qualitativeanalysis of the current assets be made, and for that reasonother ratios have been developed in this study, which itseems wise to explain, perhaps, in detail at this point.

It has become custom to insist that merchandise inven-tory, both finished product, merchandise in process, andraw material, be entered on the property statement at cost,unless market conditions are such that the market value ofthe commodities has fallen below cost, when a reductionin the valuation is called for. This is done to prevent the

inflation of the assets by the taking of profits before theyhave been actually realized, as no profit is actually sureuntil the merchandise has been sold and the actual cashor equivalent received. This is sound business sense.When we consider, however, the next economic step inmanufacture and distribution, the book account, or thebills receivable, we do not find that this cost propositionexists. We do not hear it argued that the accounts and billsreceivable should be carried on the statement at cost; andthere is a large question as to whether or not such a planwould be feasible, equitable, or even possible. We arethen confronted with the fact that, in the current assets,we have merchandise figured at cost, and receivable at'cost plus. It seems very evident that if at any time anymanufacturer or merchant billed out his entire inventory,transforming it into receivables, there would be a con-siderable increase in the total amount of the current assets,which would not make necessary any increase in the cur-rent debt, as has the cost of manufacture. It might be amere bookkeeping transaction, accomplished easily andinjecting into the current assets an amount equivalent atthe very least to the entire expected profits on the trans-action.

The effect of such a transformation would unques-tionably be to raise the current ratio. In an explanationof the result of this action, I have used the followingexample in a number of instances, and have used figureswhich, at the start, showed a 200 per cent ratio, simplybecause that has been the more generally advertised propercurrent ratio. We start with the following presumptionthat a merchant has 50 units of merchandise against whichhe owes 25 units of debt—thus establishing the 200 percent ratio. We then presume that this merchandise isturned into receivables, and that, iii so doing, the mer-chant adds 25 units for profit, etc., giving 75 units of assetsagainst 25 units of debt, producing a 300 per cent currentratio by the mere transformation from physical merchan-dise into receivables. It is not a question as to whetherthe receivables are more desirable than the merchandise,as there are arguments pro and con in this connection.It is, however, unquestionaly a fact that the transfer tendsto raise the current ratio.

Therefore it becomes interesting in the study of suc-cessive statements of any company to determine the pro-portions that have existed from year to year between thereceivables and the merchandise. If we find that thepercentage of the receivables to the merchandise is increas-ing we may be certain that $herc is a larger percentage of

| profit included in the current assets, and logically weshould expect to see an increase in the current ratio itself.If this is not the case, it makes it possible for us to inquirefrom the customer how this change or proportion has beenaffected, and why the current ratio has not risen. Thisis the first qualitative analysis of the current ratio, in thatit gives us some comparative idea as to the value of thereceivables at cost plus, as compared to the value of themerchandise at cost.



The liquidity of the receivables is a most importantqualitative consideration in studying the current ratio.It is manifestly evidenced that if we were positive thatthe receivables of subject A were collectible with greatercertainty, or more rapidly, than the receivables of sub-ject B, we ought to be content to allow A to operate witha lower current ratio because of the better quality. Thisliquidity can, in a certain measure, be determined byestablishing a ratio between the net sales for the yearand the receivables. If subject A discloses a percentageof this kind amounting to 600 per cent, we have theindication that his receivables are being collected sixtimes a year, or that the average length of sale approxi-mates 60 days. Whereas, if an analysis of the statementof subject B discloses the fact that this ratio is only400 per cent, we see that subject B is collecting hisreceivables only four times a year, or that the averagelife of the receivables is 90 days. Everything else beingequal, the receivables of subject A are more liquid, andhence of greater value.

Very much the same reasoning may be applied asbetween the sales and the merchandise, indicating theliquidity of the merchandise.

These two tests of integral parts of the current assetsare a further analysis of the current ratio from the quali-tative sense, and, if properly used, may offset a decreasein the quantitative measure of the current ratio.

While the nonliquid or fixed assets of a company undercredit analysis are often not seriously considered as ofmuch value, they may be used to good effect if a properanalysis of them is made. The net worth of a partner-ship or corporation is distributed over all the assets,divided between the current and noncurrent. It is awell-defined credit axiom that the noncurrent assetsshould be provided for by the invested funds of the ownersof the business. It has been recognized in the FederalReserve act that paper is only rediscountable when theproceeds from its issue have been used for commercialpurposes and not for plant development. If we wereto establish a ratio relationship between the net worthof any credit subject, and its plant investment, we woulddetermine what amount over and above that requiredfor plant the stockholders or owners of the business hadprovided. If the net worth of a company is 50 unitsand the plant is 25 units, the owners of the business havesupplied all of the money necessary for the plant and 25units additional active commercial working capital,which may be used to purchase raw materials, pay forthe cost of manufacture, carry their customers, etc.Therefore, whereas the noncurrent or fixed assets are notvery generally used in determining the credit risk, therelationship between the invested funds and the non-current assets discloses an interesting condition of howmuch the owners have put into the current part of thebusiness. If this ratio is studied from year to year itmakes an interesting check on net worth. A mere in-crease in net worth, as shown by comparative analysis is

interesting, of course, but the distribution of this increaseis far more interesting. If the percentage between networth and fixed assets is a falling one, it is pretty cer-tainly disclosed that the subject company is expandingits plant more rapidly than the net worth of the com-pany in proportion. It is tying up a greater fraction ofits invested funds in nonliquid assets and its capitaliza-tion is becoming more and more fixed capital. It is anindication of transformation of active into semimoribundcapital and is a very decided mark of a condition whichwhen it exists on a broad scale is conducive to tightnessof commercial credit, and this is one of the first stepstoward a condition of crisis. It is often brought aboutby an optimism due to rising prices and the hope of greatprofits through increased production. It is a check onbuilding operations that may leave the subject companyplant topheavy.

Whereas we have already considered sales in their rela-tionship to receivables, and merchandise, in order to de-termine the liquidity of certain of the current assets, wemay also use them in order to determine the activity inthe invested funds by establishing a ratio between salesand net worth. This may disclose any one of three con-ditions. First, the proportion between sales and networth may be such that it appears to be normal. Second,this ratio may show a too rapid turnover, which mayindicate undercapitalization and a feverish condition ofthe business. Third, this ratio may show a too low turn-over, indicating dry rot or nonproductivity of the investedfunds,

There is also an additional study of the statement thatis of considerable value. As we have considered the netinvestment in its comparison of the fixed assets and sales,it is also well to consider it in proportion to that part ofthe funds used in the production which have been sup-plied by outside interests. This is the commercial orfloating capital of the country, and is represented in theindividual statement by the total debt. If \ve establish,therefore, a ratio between the total debt, as disclosed uponthe property statement, and the net worth of the company,we disclose the proportion of the total capital used that isbeing supplied by creditors and by the owners of thebusiness.

The seven ratios, briefly outlined, are those which thewriter has adopted under the caption of internal analysis,in an attempt to analyze the current ratio, the capitaliza-tion plans, and the vitality of the business. Taken yearafter year in comparison they bring out interesting phasesthat there mere quantitative analysis or the current ratio,in the old comparative analysis of statements would notdisclose

The internal analysis theory, while interesting and in-structive, is only part of the business study which couldbe made, and for the making of which this report is anargument. There can be no question but that differentproportions should and do exist between the assets andliabilities of different types of business. It would hardly



be logical or fair to compare the current ratio of a hardwareconcern with the current ratio of a millinery company,although, when we admit the two for one theory this islargely what is done, with purely inspirational mentalreservations. Type is a certain factor in credit analysis,and the establishment of type is what should be attemptedupon a large scale. This would consist first of all in assem-bling the property statements of as many businesses aspossible, sorting or segregating them into types, and accu-mulating them into a typical type statement, made up ofthe totals of the different items of all of the individualstatements. The proportions that were then found toexist upon this type statement would be a decided ad-vance, if used in the measurement of the individual state-ments, over the hard-boiled two-for-one theory. Thesewould vary from year to year with changing conditionsand would create a flexible barometric measure.

However, the mere segregation into types is not by anymeans sufficient or scientific, as the different customs,economic and social requirements of different parts of thecountry would affect companies even in the same line ofbusiness. It is hardly to be supposed that a dry-goodscompany operating in New England would operate underthe same economic laws, or be able to maintain the sameproportions as one operating in California. Therefore itseems advisable in the type study to separate the typeson some sectional plan, and to establish typical figures byeconomic sections, so that within any one section any typeof business may be measured up against the typical ratiosfor that kind of business within that section.

Before leaving this section of the argument and takingup the method by which this was done, I can not but callattention to the fact that the sales of a company are a mostimportant matter in the proper analysis of the propertystatement. The scope of the present examination wouldhave been at least doubled, and probably trebled, if forevery statement examined the sales were forthcoming.The number of statements upon which the figures of thisreport are based is 981. In order to secure these 981 state-ments in which complete figures were available, it wasnecessary to examine between 2,000 and 2,500 propertystatements. I would urge upon the Federal ReserveBoard that, if possible, they develop a policy that redis-counting eligibility be dependent upon the supplying ofsales, and possibly operating memoranda, in addition tothe property statement. This in some lines of businesswould be radical, and in some lines of business not nec-essary, but by and large the principle is one that shouldunquestionably be put forth without fear or favor, andinsisted upon, excepting where good cause can be advancedwhy the information should not be forthcoming. Theprincipal argument has been that customers do not wishto disclose their sales for fear that their competitors willgain an intimate knowledge of the business to which theyare not entitled. This seems to be a very weak-kneedposition, and I would strongly urge that the Federal Re-serve Board take this particular thing under very seriousconsideration.

THE METHOD.

Through consultation and otherwise, on the basis ofestablishing sections of the country which could be con-sidered in analyzing on the type basis, a number of sec-tions were laid out, which have been used in the statis-tical work of this report. These sections were indicated onan accompanying skeleton map. They are, of course, sub-ject to adjustment, and may not meet the approval of othercredit students. They, however, follow general economiclines, and have served in this particular compilation.

The commercial paper brokers were used as the sourceof information, and almost without exception they haveforwarded to the writer complete sets of the statements oftheir commercial paper names, totaling something in theneighborhood of 2,500 names. These statements werefirst segregated according to sections, and the essentialitems of each statement transcribed to a form for ready com-pilation herewith attached.

The figures on these forms were then totaled by sections,and the following mixed type table developed, indicatingthe scope of the examination. In this table, which hasbeen labeled No. 1, the first column represents the num-ber of statements within the section that have been foundavailable for use. The second column indicates the num-ber of the section in which the name originated, and thefollowing columns indicate the amounts of the variousitems. In order to condense and simplify the work, threeciphers have been omitted, and in reading the tables thismust be remembered. (See table marked "No. 1" at-tached hereto.)

These figures were later sorted according to types of busi-ness within sections, listed in the same manner, and theresults are indicated on the tables marked " Nos. 2 to 10."both inclusive, attached hereto and made a part hereof.

The next process was to establish the seven ratios, whichhave been discussed on a national basis, taking all of thestatements as disclosed on Chart No. 1. These figures es-tablish the seven ratios for mixed figures in the nine dif-ferent sections, and also for the total mixed figures overthe country as a whole. (Chart No. 11.)

Following this Charts Nos. 12 to 20, inclusive, were per-pared, taking up several principal lines of business inwhich the statements received seem to provide enoughstatistics so that an analysis as between sections would bepossible.

Following this the ratio Charts Nos: 21 to 29, inclusive,were developed, carrying out the development of theseven-point analysis for these lines of business in thevarying sections, establishing the type sectional baro-metric figures. Charts Nos. 11 and 30 were also developedto indicate mixed type ratios and total national ratios andalso the ratios for the several types of business taken asexamples.

RESULTS.

A proper understanding of the results of this analysis is,of course, best disclosed by a careful comparison of figures,in detail. This, perhaps, would not be within the prov-


MARCH 1,1919. FEDERAL RESERVE BULLETIN. 233

ince of this report, other than to call attention to the moresalient features, because deductions from the figures willvary with the individual knowledge and inspiration of theperson making the analysis. It may be interesting how-ever, to indicate, briefly, some of the more evidentthoughts that are brought to the surface.

At the beginning of this examination, mention was madeof the current ratio theory of two for one, or 200 per cent.If we turn to Chart 11, and investigate the current ratio,it will be found that the lowest point in the mixed typesis displayed in section 1, and registers 233.43 per cent.The highest ratio is found in section 8 and registers 305.55per cent, a considerable fluctuation, and the minimumbeing substantially above 200 per cent. The proportionof the ratio of receivables to merchandise varies from thelow point in section 9 of 56.11 per cent, to the high pointin section 4 of 82.43 per cent. The worth to fixed assetsratio varies from the low point in section 3 of 165.15 percent to a high point in section 7 of 345.43 per cent. Theliquidity of the receivables ratio varies from a low pointof 515.08 per cent in section 5, to a high point of 890.14per cent in section 3. The liquidity of the merchandisevaries from a low point of 360.82 per cent in section 5 to ahigh point of 544.55 per cent in section 3. The activityof the invested funds varies from a low point of 142.52 percent in section 8 to a high point of 297.60 per cent in sec-tion 6. The ratio of debt to net worth ranges from a lowpoint of 22.16 per cent in section 8 to a high point of 52.46per cent in section 3. If we are to consider these ratiosin their relationship to types of business, we will find a,perhaps, even more interesting variation. In this particu-lar phase, I have eliminated from the consideration thetypes of business in sections where less than five state-ments have been considered. The highest current ratiofound is in the hardware type in section 6, based on 13names, and runs to 381.05 per cent. The lowest ratio inthis type is 253.97, based on 16 names in section 7. Thelowest current ratio for type by sections is 157.98 per cent,being a somewhat peculiar ratio, in that it is one takenbetween the current assets and the total liabilities, becauseof the fact that in this particular section, in this particularline of business, a large part of the debt has been fundedin several instances, but still from a liquidating standpointis still largely current. This ratio is found as a result ofJO packers' statements in section 3. The highest packers'ratio is found in section 2, being made up of only one state-ment, which shows a current ratio of 640 per cent, and isprobably not typical. The national figures, using thecurrent assets and current liabilities only for packers, is235.49 per cent, and the ratio between the current assetsand the total liabilities, thereby taking account of thebonded or deferred debt, is 160.65 per cent. A fair creditcurrent ratio is probably something in the neighborhoodof 185 per cent.

An analysis of Chart No. 30, made up of the nationalratios of various types of business, discloses the fact that

106597—19 7

type No. 7, or farm implements, registers the highest cur-rent ratio. It amounts to 355.78 per cent, based on thecomposite figures of 20 statements, representing in bulka net worth of $61,328,000 and sales of $63,074,000.Taken on the purely quantitative two-for-one theory,this would seem like a very high average. When takenhowever, from the qualitative angle, this extremely highratio does not appear so prominently supersatisfactory.While the final mixed current ratio taken from the whole981 statements is only 241.56 per cent, giving type 7an apparent margin of betterment of 114.22 points, thequalitative ratios of sales to receivables, and sales tomerchandise, do not show to as good advantage. Theseby comparison are as follows:

Current ratioSales—Receivables..Sales—Merchandise.

Mixednationalfigures.

"I

Per cent.241.56734.61473.44

i

Type 7.

Per cent.355.78329.62209.33

The greater slowness of turnover, both of receivablesand merchandise, evidences much less liquidity of re-ceivables, and slower merchandising.

The ratio of sales to worth of 102.84 per cent, as comparedto the mixed ratio of 249.34 per cent, indicates a very muchslower than the average turnover, or a more torpid invest-ment.

In contra to this type study it will be interesting toanalyze the typical indications of type 12, or the packergroup. Here we find a current ratio of 235.08 per cent,some 6 points below the mixed type. When we substitutefor this the ratio" between current assets and total debt,160.65 per cent, or an estimate true ratio of say 175-180per cent, we find the current ratio from 60 to 70 pointsbelow national mixed current ratio. Here again, however,we find the qualitative ratios supporting the lower ratio inthe same manner in which they tended to level the higherratio. The same kind of comparative summary is inter-esting.

Mixednationalfigures.

Current ratioSal os—Receivables..Sales—Merchandise.

Per cent.241.56734.61473.44

Type 12.

Per cent.160-170

1,027.30829.57

The very much faster turnover of receivables and mer-chandise indicates clearly greater liquidity in the currentassets, and hence a greater potential liquidating strengthin the current ratio, even if quantitatively lower.

The ratio of sales to worth, 483.27 per cent, as comparedto the mixed ratio of 249.34 per cent, also indicates a much



more active investment. This is somewhat offset by thefact of the higher debt ratio of 80.36 per cent, comparedto the mixed ratio of only 47.19 per cent.

This shows how the internal 7-point ratio analysis ex-pands ordinary analysis by checking and explanatorystudies. This same comparison between the ratios of anindividual statement and the type and national mixedfigures shows weaknesses of collection methods, poor orgood merchandising, etc.

The two types used in detail were selected because theyformed radical extremes, but typical variations occur inthe other types, and within any type sectional variationsof a similar nature are so very apparent that a detailedexplanation in this report is omitted other than to callattention to the charts on which they are indicated.

In order to eliminate unnecessary details and still todisclose the principle, I have compiled Chart No. 30, indi-cating a comparison between nine types of business, usingthe national ratios. These businesses are as follows:

Dry goods, wholesale 1Hardware, wholesale 2Grocers, wholesale 3Milling 4Tanners 5Drugs 6Farm implements, etc 7Furniture 8Lumber 9Packers, fruits, etc 10Department stores 11Packers : 12Boots and shoes 13Paper 14Iron and steel - ' 15Oils 16Hats, caps, men's clothing-, etc 17Seeds, etc 18Knitting mills, etc 19Building materials, etc 20Machinery 21Household supplies 22

Foodstuffs, miscellaneous 23Rubber goods 24Auto accessories, etc 25Cotton mills 26Fuel 27Woolen 28Automobiles 29Miscellaneous 30

An examination of this chart indicates that the currentratio in the packing business is lowest of that of any ofthe types. With the old-fashioned 200 per cent currentratio theory this might lead the analyst to believe thatthe packing business was weak, because of the lownessof its current ratio, although inspirational analysis hasmade indefinite allowances. If, however, we apply tothe condition the qualitative analysis, we find that thereceivables in the packing business display a very muchgreater liquidity, as does also the merchandise, the salesto receivable ratio and the sales to merchandise ratiobeing very much higher than in any of the other types ofbusiness. This substantiates the general belief that apacking company can operate safely on a very much lowercurrent ratio than can the other types of business. Wealso find that the activity of the investment in the packingbusiness is very much higher than that of other lines ofbusiness. The ratio of worth to fixed assets indicates thatthe packers rely very largely upon outside investmentfor the carrying of their current assets, because it displaysa very low ratio. This is substantiated also by the ratioof debt to net worth, and it is considerably higher than anyof the other types under discussion.

This national chart, taken as a first guide in comparisonwith an individual statement, would indicate whetheror not the figures of the individual statement were approxi-mately in line with the type of business into which theyfall. This being generally established, we may progressto the analysis of the figures by comparing them withthe section within which the type operates and get afurther viewpoint as to the nearness of the approachto the actual condition in the line of business.

CHART N O . 1.—Mixed national figures.

State-ments.

911.3816510772

1441273641

981

Section.

123456789

Currentassets.

$199,451273,596774.84566,278

167,817195,008101,25033,33068,461

1,880,036

Currentliabilities.

$85,443116,598328,28525,37461,95882,27340,11010,90826,668

777,517

Debt.

$91,177124,321419,06826,51478,42883,27640,80210,97126,786

001,343

Receiv-ables.

$75,18487,423

252,05227,22462,36470,09438,90212,41622,026

648,285

Merchan-dise.

8101,774145,813412,99733,02689,025

106,04654,11317.86039,253

1,005,907

Fixed.

8110,008155,780483,65921,07985,22896,61521,11327,67328,953

1,033,108

Worth.

S21O,651286,737798,77361,119

170,007180,47883,29549,49169,421

1,909,972

Sales.

5440,701576,535

2,218,963152,147321,225537,104244,267

70,538170,932

4,762,412



CHART NO. 2.—Section No. 1.

State-ments.

62516214111

2022420534

14

91

Type.

12345689

1011121314151719202123242S

Currentassets.

$11,215788

3,207587

22,70918,427

6403,5222.5*8

094641

51,2651,0402,4}")2,751

9536,2245,0281,567

18,42444, 776

199,451

Currentliabilities.

S-1,040352

1,578150

10,8476,749

2301,312

941220430

23,669501836

1,371353

2,7411,968

3058,123

18,115

85,4:13

Debt.

$5,067352

1,613150

10,8476,719

2301,359

941226430

24,083575908

1,423353

3,7822,267

3058.127

21,270

91,177

Receiv-ables.

85,039319

1,470122

8,3323,913

2191,6541,685

203290

23,200236601749303

3,1211,5131,0027,166

13,958

75,184

Merchan-dise.

85,674325

1,470411

12,7G013,011

3491,612

717411282

23,871714

1,7421,786

5952,3952,312

3169.216

27, 715

107,774

Fixed.

82,037193451

871,870

35,461398

2,220232559688

13,6782,1442,014

722597

6,4895,921

63511,12822,484

110,008

Worth.

38,191833

2,027524

12,55442,532

8094,3911,840

812797

41,6162,0693,6612,0391,1398,8638,0691,871

21,42544,589

210,651

Sales.

829,7491,974

10,0377.165

io, 22644,7111,4598,050

10,0002,1992,629

109,8172,5024,6284,5031,912

16,3289,7096,562

35,80085,705

410,701

CHART NO. 3.—Section No..

State-ments.

71024

732231

101

14317

1828242322

138

Type.

o356789

10111213141516171819202122232428

Currentassets.

511,6906,428

17,8589,0515,7552, 7984,4062,533

22834.515

1,12043, 7652,606

66127,12645.383i;7676,7621.7836,3334,3139,447

26,518740

273,590

Currentliabilities.

$5,4362,4107,7943,4522,1541,3602,3841,059

6912,617

17520.216

'759300

13, 74320,723

4533,293

3672,4131,8525,4767,462

431

116,598

Debt.

86,0482,791

10,7073, 7312,1541,3602,3841,059

6912, 727

17520,2412,855

30013, 74320, 770

4533,435

5872,4132,9505,4767,462

431

124,321

Receiv-ables.

55,5001,7066,8353,0281,6401,0702,3341,175

5111,980

27812,S60

880139

7,83914,759

3082,075

4062,1791,1873,4565,508

230

87,423

"Merchan-dise.

$5,4004,1559,2134,7173,4301,4531,735

802143

19,102751

24,570917507

17,05827,7921,3114,0501,2723,5391,7574,9756,727

437

145,813

Fixed.

82,0261,3729,3262,6323,8921,8866,092

948802

29,7112,1891,5037,3611,023

14,89733,830

5195,6971,1442,6526,358

13,3986,226

296

155,780

Worth.

87,6594,949

16,5687,8897,0503,3238,1202,410

96152,2862,685

24,4735,999

66228,74057,222

1,8338,3852,3396,2757,495

17,50411,304

606

286,737

Sales.

S25,26613,76059,12814,47412,2346,6185,9446,3001,038

83,7072,652 j

53,0807,1351,005

100,55278.0571 897

19,6043,422

17,59912,06233,26415,7871,950

576,535 j


236 FEDERAL RESERVE BULLETIN. MARCH I,1919.

CHART NO. 4.—Section No. S.

State-ments.

121429

1835

10612

1094744438A

261125

165

Type.

123456789

101112131416171819202122232425272829

Currentassets.

812,6808,898

24,420820

17,4431,9067,8066,585

12,3091,0451,143

397,2866,2581,900

11,5105,5785,0602,8483,330

12,9639,4585,676

155,0089,7961,8692,730

48,511

774,845

Currentliabilities.

$5,0932,253

10,03876

5,561939

2,9832,2694,432

606653

169,8902,025

6825,2902,6793,153

949765

4,7314,2113,116

71,8583,9241,0921,555

17,462

328,285

Debt.

$5,1252,603

10,09576

6,989

4,483.2,4584,607

6061,050

251,4702,137

6825,8462,6795,837

9492,0035,1114,2733,116

71,9013,9241,0921,555

17,462

419,068

Receiv-ables.

84,8313,3187,423

434,517

8061,1412,0883.199

'564280

146,2152,742

6563,1382,266

806704

1,1163,9571,5862,539

41,3082,3181,621

77912,691

252,652

Merchan-dise.

87,2095,234

15,60197

11,894970

5,0934,3647,656

373820

176,7923,243M347,2542,7143,8881,9192,0417,6887,2501,483

100,0526,300

11,216

30,711

412,997

Fixed.

$2,6233,4466,477

4547,195

5549,7585,793

14,970278

1,200157,932

8612,688

*S§5,2941,2729,8776,781

16,8968,882

142,47716,354

601731

50,950

483,659

Worth.

810,1849,578

20,6421,049

16,8571,078

12,8189,838

20,690717

1,286297,443

4,9223,788

13,2253,0244,9573,058

10,72713,94021,69811,313

211,52222,048

1,2941,432

68,885

798,773

iSales.

$23,78318,19280,0955,869

33,6974,211

11,47512,93523,148

1,7752,767

1,490,92813,4385,514

32,0098,7596,0693,7794,996

16,34718,45042,966

274,34324,1039,2625,456

72,577

2,248,963


State-ments.

6254741412261512

107

Type.

123456789

1113192022

Currentassets.

$4,28719,79120,1391,890

2032,405

7641,7151,4376,205

8155,263

846518

66,278

Currentliabilities.

81,4977,2817,574

16699

794280564664

3,074216

2,352530283

25,374

Debt.

SI,4977,3277,646

16699

996280564664

3,644216

2,602530283

26,514

Receiv-ables.

SI,9208,0779,242

62961

944361983675

1,709470

1,665314174

27,224

Merchan-dise.

$2,34010,6559,526

322128

1,368390669597

3,255324

2,648470334

33,026

Fixed.

S4722,6933,623

89515

556152324562

5,93571

4,0821,068

621

21,079

Worth.

$3,49415,53016,3872,515

1191,962

6361,5011,3398,483

6696,1701,362

952

61,119

Sales.

87,81736,30364,0498,264

4794,743

9412,6522,566

10,712914

10,6261,0051,086

152,147


State-ments.

48

15233

1137233121211

72

Type.

1235789

1213141617181920212224

Currentassets.

$9,20321,26220,63820,24131,971

1,23613,2736,0879,0824,9023,3607,712

3494,109

2695,5108,252

361

167,817

Currentliabilities.

84,2168,0748,6838,6355,858

4485,5162,9503,9302,3471,4503,562

1482,204

632,1631,445

266

61,958

Debt.

S4,4468,108

10,3198,635

11,871448

6,2202,9503,9309,2731,5264,357

1482,204

632,1631,445

302

78,428

Receiv-ables.

S4,1048,4878,8124,978

12,376376

6,5951,7543,8471,346

9222,986

971,250

751,9802,349

30

62,284

Merchan-dise.

$4,05511,80510,45514,25515,776

8185,9533,5054,4171,1582,1664,419

2372,537

1863,1163,846

321

89,025

Fixed.

$1,5515,8104,0679,302

14,910555

4,1544,0591,695

16,0792,5903,449

1402,486

7834,2968,798

504

85,228

Worth.

$6,29018,76513,95720,88031,4131,325

11,1637,1556,722

11,7074,4256,679

3384,390

9877,643

15,605563

170,007

Sales.

$13,59841,16160,14331,98322,1761,773

22,21033,86416,1269,651

24,03512,173

6346,459

4048,356

15,0001,479

321,225




State-ments.

12132725

1461

1541

10224214532

144

Type.

1234567S9

111213141617181920212223

Currentassets.

542,3648,989

24,38417,093

4352,4014,491

2628,984

15,571220

52,600576663

4,920915

1,0563,4223,998

791873

195,008

Currentliabilities.

§21,6482,359

10,2286,853

167412

1,597133

3,5515,568

11822,904

129280

2,632259355

1,4001,394

24541

82,275

Debt.

§21,6482,434

10,3486,853

167412

1,669133

3,5525,718

11823,084

129280

2,632259355

1,6851,514

24541

83,276

Receiv-ables.

$19,1372,3098,4993,786

147844

1,87699

3,5564,256

2019,374

170286

1,817274530

1,1081,274

310422

70,094

Merchan-dise.

$20,4425,944

14,4437,615

2731,4712,334

1584,5558,654

19529,979

394341

2,806538515

2,1852,432

424348

106,046

Fixed.

$9,6541,1825,079

15,67473

5352,103

723,702

22,311155

26,212310256540358182

4,1162,168

654879

96,615

Worth.

$26,5467,536

18,96825,105

3412,5034,693

2019,315

32,177257

33,322697648

3,2301,014

6835,3204,5281,1841,710

180,478

Sales.

$82,02518,29075,238

134,939371

5,2656.239

'45413,49542,201

916121,073

2,2261,6457,4023,0551,4138,0488,6881,5262,095

537,104


State-ments.

27164691114

62122122

127

Type.

I3456789

1113141516172021

Currentassets.

$31,83410,86534,4252,9061,526

806208

2,2482,0304,1022,179

3953,741

622337

1,0741,937

101,250

Currentliabilities.

$13,1184,278

15,38391822621353

998412

1,38167312891927947

273811

40,110

Debt.

$13,1284,359

15,65891822623853

998412

1,396673128

1,08027947

273936

40,802

Receiv-ables.

$12,1063,734

14,01377788329175

946938

1,286798238

1,433323136153772

38,902

Merchan-dise.

$16,3926,306

18,1341,616

454482103

1,261968

2,5941,237

1512,092

214160830

1,119

54,113

Fixed.

$7,0201,4664,3731,965

33916886

6622,6122,385

222100

1,12053713

507538

24,113

Worth.

§25,7527,642

22,8983,9011,645

739242

1,9174,2325,0911,729

3673,720

841303

1,308908

83,295

Sales.

$61,40919,85696,49525,2415,6322,156

5023,1122,1887,9233,290

6667,9492,799

6081,6102,831

244,267


State-ments.

44511713111114i

36

Type.

123469

101112131721222325

Currentassets.

$1,8494,8511,811

796512

5.315422

1,3531.776'211533

1,790905

10,780426

33,330

Currentliabilities.

$6981,899

56212673

2,116

4271,046

118152968415

2,096212

10,908

Debt.

S6981,899

56212673

2,116

4271,046

118152

1,031415

2,096212

10,971

Receiv-ables.

$7431,732

761276149

2,55012232459198

165570391

3,759182

12,416

Merchan-dise.

$1,0582,977

977305347

2,467268878

1,10880

3671,165

4645,175

224

17,860

Fixed.

$8371,741

19553833

2,295672

1,0311,272

156

1,02483

17,579217

27,673

Worth.

$1,9874,6511,4291,008

4675,4161,0431 9262,003

249381

1,801554

26,148431

49,494

Sales.

$4,0279,9494,7906,751

„ 1,122* 11,430

1,2313,1584,987

401716

1,4862,043

17,3011,168

70,538




State-ments.

577423232222

41

Type.

12340

6789

111213

Currentassets.

$7,85410,4175,5918,5334,2632,8128,8884,8461,7893,700

10,3301,638

68,461

Currentliabilities.

$3,1783,5952,2292,4141,7611,0063,8692,028

6971,5303,663

698

26,668

Debt.

$3,1783,6552,2622,4141,7871,0063,8692,023

6971,5303,663

698

26,786

Receiv-ables.

S2,9563,0062,2922,6261.368

8522,2362,317

696574

2,584519

22,026

Merchan-dise.

84,0066,8083,0672,9352,5211,8235,6812.421

9222,8145,368

987

39,253

Fixed.

85461,887

8726,1121,099

3363,1851,2853,550

8219,114

146

28,953

Worth.

$5,5258,5124,200

12,2333,5762,1068,2034,1034,6752,990

12,2121,086

69,421

Sales.

$12,65918,17517,72750,5605,8485,597 !

13,1236,9114,2649,866

22,8053,397

170,932

CHART NO. 11.—National mixed type ratios.

Sections

Number of statements

Onrrent ratioReceivable merchandiseWorth—fixed assetsSales—receivableSales—merchandiseSales—worthDebt worth

1

91

Per ct.233.4369.76

191.48586.16408.91209.2143.28

2

138

Per ct.234.6559.95

184.06659.48395.39200.7143.35

3

165

Per ct.236.0261.17

165.15890.14544.55281.5552.46

4

107

Per ct.261.2082.43

289.95558.87460.68248.9743.38

5

72

Per ct.270.8570.05

199.47515.08360.82188.9446.13

6

144

Per ct.237.0266.09

186.80766.26506.48297.6046.14

7

127

Per ct.252.4071.89

345.43627.90451.58293.2548.98

8

36

Per ct.305.5569.51

178.84568.12394.94142.5222.16

9

41

Per ct.256.8156.11

239.77776.04435.46246.2238.58

Nat.

981

Per ct.241.2464.64

184.47734.61473.44249.3447.19

CHART NO. 12.—Wholesale dry goods—Type 1.

State-ments.

67

1264

1227

45

83

Section.

1234567

9

Currentassets.

311,21511,69012,6804,2879,203

42,36431,8341,8497,854

132,976

Currentliabilities.

$4,6465,4365,0931,4974,216

21,64813,118

6983,178

59,530

Debt.

So,0676,0485,1251,4974,466

21,64813,128

6983,178

60,855

Receiv-ables.

85,0395,5004,8311,9204,104

19,13712,106

7432,956

56,236

Merchan-dise.

$5,6745,4007,2092,3404,055

20,44216,3921,0584,006

66,576

IFixed. ;

82,037 :

2,0262,623 :

472 .1,551 ;9,654 !7,020 :

837546 ,

26,766 :

Worth. !|

88,191 I7j659 I

10,184 13,494 ',6,290 j

26,546 i25,752 !

1,987 !5,525 |

95.628 !

Sales.

$29,74925,26623,7837,817

13,59882,02561,4094,027

12,659

260,333

CHART NO. 13.—Wholesale hardware—Type 2.

State-ments.

2»101425

8131647

S3

Section.

123456789

Currentassets.

S7886,4288,898

19,79121,2628,989

10,8654.851

10,417

92,289

Currentliabilities.

$3522,4102,2537,2818,0742,3594,2781,8993,595

32,501

Debt.

$3522,7912,6037,3278,1082,4344.3591,8993,655

33., 528

Receiv-ables.

S3191,7063,3188,0778,4872,3093,7341.7323; 006

32,688

Merchan-dise.

§3254,1555,234

10,65511,8055,9046,3062.9776,808

54,209

Fixed.

$1931,3723,4462,6935,8101,1821,4661,7411,887

19,790

Worth.

$8334,9499,578

15,53018,7657,5367,6124,6518,512

77.996

Sales.

81,97413,76018,19236,30341,16118,29019,8569,949

18,175

177,660



CHART NO. 14.—Wholesale grocer—Type 3.

State-ments.

5242947152746

57

205

Section.

123456789

Currentassets.

$3,20717,85824,42020,13920,63824,38434,4251,8115,591

152,473

Currentliabilities.

$1,5787,794

10,0387,5748,683

10,22815,383

5622,229

64,069

Debt.

51,64310,70710,0957,646

10,31910,348

• 15,658562

2,262

69,240

Receiv-ables.

$1,4706,8357,4239,2428,8128,499

14,013761

2,292

59,247

Merchan-dise.

$1,4709,213

15,6019,526

10,45514,44318,134

9773,067

82,886

Fixed.

$4519,3266,4773,6234,0675,0794,373

195872

34,463

Worth.

$2,02716,56820,64216,38713,95718,96822,898

1,4294,200

117,076

Sales.

$10,03759,12880,09564,03960,14375,23896,4954,790

17,727

467,692

CHART NO. 15.—Tanners—Type 5.

State-ments.

67812112

28

Section.

12345679

Currentassets.

§22,7099,051

17,443203

20,241435

1,5364,263

! 75.881i

Currentliabilities.

810,8473,4525,561

998,035

167226

1,761

30,738

Debt.

•110,8473,7216,989

998,035

167226

1,787

32,481

Receiv- j Merchan-ables. 1 dise.

$8,3323j 0284,517

614,978

147883

1,368

S12,7904.717

li;894128

14,255273454

2,521

23,314 | 47,032

Fixed.

$1,8702,6327,195

159,302

73339

1,099

22,525

Worth.

312,5547,889

16,857119

20,880341

1.64,53,576

63,861

Sales.

$45,22614,4.7433,697

47931,983

8715,6325,848

138,210

CHART NO. 16.—Drugs—Type 6.

State-ments.

23344113

21

Section.

12346789

Currentassets.

$18,4275,7551,9062,4052,401

806512

2,812

35,024

Currentliabilities.

$6,7492,154

93979441221373

1,006

12,340

Debt.

86,7492,154

93999641223873

1,006

12,567

Receiv-ables.

$3,9131,640

806944844291149852

9,439

Merchan-dise.

$13,0113,430

9701,3681,471

482347

1,823

22,902

Fixed.

$35,4613,892

55455853516833

336

41,535

Worth.

$42,5327,0501,4781,9622,503

739467

2,106

58,837

Sales.

$44,71112,2344,2114, 7435,2652,1561,1225,597

80,039

CHART NO. 17.—Farm implements—Type 7.

State-ments. Section,

13612

20

Currentassets.

$2,7987,806764

31,9714,491208

56,926

Currentliabilities.

SI,3602,983

2805,8581,597

533,869

16,000

Debt.

SI, 3604,483

28011,8711,669

533,869

23,585

Receiv-ables.

SI, 0701,141361

12,376],876

752,236

19,135

Merchan-dise.

SI,4535,093

39015,7762,334

1035,681

30,830

Fixed.

SI.8869; 758

15214,9102,103

863,185

32,080

Worth.

S3,323.12,818

' (53631,4184,cm

2428,203

61,328 63,074



CHART N O . 18.—Lumber—Type 9.

State-ments.

4362

1115472

54

^ptinn 1 Currentsection., a s s e t S f

1 ! S3,5222 1 2,5333 : 12,3094 ! 1 4375 1 13,2736 ; 8,9847 i 2,0308 i 5,3159 | 1,789

j 51,192i

Currentliabilities.

SI, 3121,0594,432

6645,5163,551

4122,116

697

19,759

n o > , t i Raceiv-D e b t ' | ables.

§1,359 51,6541,059 1,1754,607 : 3,199

684 6756,220 6,5953,552 3,556

412 9382,116 i 2,550

697 696

Merchan-dise.

SI, 612802

7,656597

5,9534 551

9682,467

922

Fixed.

52,220948

14,970562

4,1543,7022,6122,2953,550

Worth.

84,3912,410

20,6901,339

11,1639,3154,2325,4164,675

20,686 21,038 ; 25,528 j 35,013 63,631

Sales.

$8,0566,300

23,1482,566

22,21013,4952,188

11,4304,264

93,657

CHART N O . 19.—Packers—Type .

State-ments.

11

103112

19

Section.

1235689

Currentassots.

$6411,120

397,2866.087

2201,776

10,330

417,460

Currentliabilities.

$430175

169,8902,950

1181,0463,663

177,272

Debt.

§430175

251,4702,950

1181,0463,663

259,851

Receiv-ables.

3290278

146,2151 754

20591

2,584

151,732

Merchan-dise.

S282751

176,7923,505

1951,1085,268

187,901

Fixed.

$6882,189

157,9324,059

1551,2729,114

Worth.

$7972,685

297,4437,155

2572,003

12,212

175,409 j 322,552

Sales.

$2,629 !2,652 i

1,490,928 !33,864

9164,987

22,805

1,558,781

CHART N O . 20.—Boots and shoes—Type 13.

State-ments.

2014

917

10212

66

Section.

123456789

Currentassets.

851,26543,7656,258

8159,082

52,6002,179

2111,638

167,813

Currentliabilities.

$23,66920,2162,025

2163,930

22,904673118698

74,449

Debt.

$24,08320,2412,137

2163,930

23,084673118698

75,180

Receiv-ables.

$23,20012,8602,742

4703,847

19,374798

98519

63,908

Merchan-dise.

$23,87124,5703,243

3244,417

29,9791,237

80987

88,707

Fixed.

$13,6781,503

81671

1,69526,212

222156146

44,499

Worth.

$41,61624,4734,922

6696,722

33,8221,729

2491,086

115,288

Sales.

$109,81753,08013,438

91416,126

121,0733,290

4013,397

321,536

CHART N O . 21.—Dry goods—Type ./.

Sections -

Number of statements.. 6

I Per cent.Currentratio j 241.39Receivable merchan-

90.41402.11

dise.-Worth—fixedSales—receivableSales—merchandiseSales—worth

524.30.._._ . . . . . 363.19

Debt—worth = 61.86

12

Per cent. \Per cent.215.04 | 248.96

101.85 67.01378.03 ! 388.29459.38 | 492.29467.88 ! 329.90329.88 ! 233.5378.96 | 50.32

Per ct. \Per cent.288.37 j 218.28

82.05 i740.25 i407.13 I334.05

101.21405.54331.33335.33

223.72 ! 216.1842.84 I 71.00

12

Per cent.195.69

93.61274.97428.16401.25308.9936.36

27

Per cent.242.67

73.85366.83507.26374.62238.4650.97

Per cent.264.89

70.22237.39541.49380.62202.6635.12

Per cent.247.13

73.481,011.90428.24316.00229.1257.52

Nat.

Per cent.223.38

84.61357.27482.10391.03272.2363.66


MARCH 1,1919. FEDERAL BESEBYE BULLETIN. 241

CHART NO. 22.—Hardware—Type i

Sections.

Number of statements.. j 10 14

Current ratioReceivable merchan- I

dise ..I 98.15Worth—fixed..... I 431.60 \Sales—recei vable ! 618.80Sales—merchandise..... | 607.88Sales—worth.. 236,97'Debt -wor th . . . . . . . . . . . 42.25

Per cent. •Per cent. Per cent.223.22 266.72 394.94

41.06260.70806.58331.16278.0356.89

277.94548.28347.57189.9327.17

Per ct. \Per cent271.32 ! 263.83

75.80576.68449.46340.7123S.7647.15

71.89322.97484.98348.67219.3443.20

J.3 | 16

Per cent. Per cent.SSI.05 I 253.97

88.84637.55792.11207.70242.7082.29

i

59.21521.28531.76314.87259.8348.86

Per cent. Per cant.255.45 | 289.76

58.17 [ 44.15267.14 ! 457.00574.42 | 604.62334.19 ^213.9140=82 !

266.96213.524.2.93

Nat,

Per cent. j283.95 j

60.29 i394.11 !543,50 !327.73 !227.78 !42.98 .

CHART N O . 23.-— Grocers- Type $.

Sections..

Number of statements. -

Current ratio *Receivable merchan-

Worth—fixed , . .S&'os—r'scei vableSales—merchandise.....Sales—worth

1

5

Per cent,203.26

100.00499.41682.78882.78495.1681.05

2

*

Per cent.229.12

74.18177.66865.07641.77856.8764. 61

3

,.— .,

29

Per cent.243.27

47.58318.69

1,079.03413-39388.0148.90

4

47

Per ci.265.89

97.56452.58092.91672.25390.7946.65

6

25

Per eevd.237.68

84.26313.17682.51575.25430.9173.93

g

Per cent.288.42

58.84373.45885.25520.93396.65

7

46

Per cent.223.78

77.27523.62688.61532.12421.4168.38

S

5

Per ceiu.322.22

77.89782.82629.43490.29335.1939.32

9

7

Per cent.250.82

74.73481.65773.42577.89422.0753.85

Nat,

205 ;

Per cent. •'237.98 !

71.60 .839.71 ,788.06564.25399.4759.14

CHART NO. 2i.—Tan'aers—Type 5.

Current r a t io . . . , j 209.Receivable merchan-

dise 65.14Worth—fixed..... 671.33Sales—receivable | 542.79Sales—merchandise.... J 353.80Sales—worth 360.25Debt—worth 86.40

64.19299.73359.33306.84183,4747.29

37.97234.28746.00283.31199.8941.46

47.65 I

785.24 i374.21 !402.53 !43.35 !

34.92224.46642.98224.36153.1741.35

6

1

Per cent.260.47

467.12592.51319.04255,4248.07

!

i

Per cent.379.64

25.59487.90637.82

1,240.52342.37

13.37

NO. 25, -DrugH—Type 6,

• Sections.

• ' \Number of statements...

iPer cent.Current ratio I 273.03Receivable merchan-

dise 30.07Worth—5 xed 111.94Sales—recei vable :1,142.62Sales—merchandise 343.643a !PS—worth 105-12Debt—worth | 15.86

Per cent.267.17

47.811S1.14745 97356 66173 5330.55

Per cent.202.98

S3.09266.78522.45434.12284.9163.53

100597—19— -8

Per ct. \Per cent302.89

69.00352.87502.43346.71241.7450.76

Per cent.582.75

5746762335721016

378581913448

Per cent.378.40

60.37439.88740.89347.30291.7432.20

Per cent.701.36

42.941,415.15

75302323 33240.25

15.63


242 FEDERAL BESERTE BULLETIN. MABCH 1,

CHART NO, 26.—Farm implements—Type 7.

;; Sections.

! Number of statements.

Current radio.Receivable merchan-

diseWorth—fixed.. . . . . . . . . .Sales—receivableSales—merchandise.Sales—worthDebt—worth... .

Per cent. Per cent.205.73

73.64176.19618.50455.47199.1540.92

5 I 6

i

Per cent-. \ Per ct.261.68 272.85

22.40 92.56131-35 I 418.42

1,180.98 | 260.66264.57105.1284.97

241.28147.9544.02

Per cent.545.78

78.45210.88179.18140.5670.5937,79

Per cent.281.21

80.87223.15232.56267.30182.9485.56

Per cent.483.61

72.81281.89569-32487.37207.4821.90

Per cent.

1 Nat.

Per cent.329.72

39.35257.56586.86230.99150.9747.16

20

Per cent!355.78

63.50191.17329.62209.33102.84as. 45

i

CHART N O . 27.—-Lumber— Type 9.

• Sections.

j Number of statements..

Per cent.Current ratio 288,44Receivable merchan-

dise ! 102.60Worth-Fixed... ! 97.79Saics—Receivable 487.08Sales—Merchandise..... 499.75Sales—Worth,.... 184.46Debt—Worth i 30,, 94

2

3

Per cent.239.18

146.50254.21536.17785.53201.4143.94

Per cent.277.72

41.7833R.20723.60302.35111.8722.25

11

Percent Per cent216.41

113.06238.25380.14429.81191.6349.58

240.62

110.78268.92336.77373.08198.9655.71

15

Per cent.252.99

78.13251.62379.49296.52144.8738.13

Per cent.492.71

98. SO162.02233.26226.0351.7043.92

Nat.._ j _

Per cent.251.18

103.36186.43448.23463.31211.0439.06

2 ! 54

Per cent.256.67

75.58131.68612.64 ,462.4791.2017.90

Per cent.259.08

82.37181.73445.18366.87147.1832.50

CHART N O . 28.—Packer*—Type IS.

Sections.

Number of statements.

Special current ratioCurrent ratioReceivable merchan-

diseWorth—Fixed..Sales—ReceivableSales—Merchandise..Sales—Worth - . , . . .Debt—Worth...,

Per cent. Per cent.

149.06

102.83110.02906.55932.36329.8653.95

640.00

37.02122.65953.95353.1298.776.50

10

Per cent.157.98233.84

82.70188.33

1,019.68843.32501.2484.54

Percent. Per cent Per can.

206.33

50.04176.27

1,093.67766.16473.0641.22

Per cent

186.44

10.25165.80

4,580.00469.74356.4245.91

Per cent.

* 169.° 79"

53.33157.46843.82450.00248.9758.22

Per cent

Nat.

282.00

49.05133.99882.54432.89186.7429.98

IPer cent.

1(50.65235.49

80.75183.88

1,027.30829.57483.2780.55

CHART NO., 29.—Boots and shoes—Type IS*

Sections.,

Number of statements.. 20!

Current ratio •Receivable merchan-

diseWorth—FixedSales—ReceivableSales—MerchandiseSales—Worth.Dobt—Worth

Per cent.216.59

97.18 52.34204.25 1,628.27473.34 j '412.75460.04263.88 i57.!


M A R C H 1,3L019.

Types ,

Number of statements..

Current ratio . . . . .

Receivable merchan-dise

Worth—Fixed . . .Sales™ ReceivableSales—Merchandise.Sales—WorthDebt. -Worth

I

S3

Per cent.223.38

84.61357 27•162.10391.03272.2363.66

.FEDERAL EESEBVE BULLETIN

CJHARl

2

99

Per cent.283.95

00.29394.11543.50327.73227.7842.98

No. 30

3

205

Per cent.237.98

71.60339.71788.00564.25899.4759.14

.—National type ratios.

5

28

Percent.246.80

49.57283.51592.81293.86216.4250.86

6

21

Per cent.269.35

41.21141.65847.96349.4813ft.0521.35

7

20

Per cent.355.78

83. SO)91 17329.02209.33102.8488.45

9

54

Per cent.259.08

82 37381 73445.18386.87147 1832.50

12

19

Per cent.235.49"•60 65

SO 75183 88

1.027.30828.57483 27

SO. 58

13

66

Per cent225.40

72 04259 07503.12362.46278 s?965.21

?

•

243

NOTE.—These tables are of eou?3e not complete, but are indicative of what maybe accomplished by coordinatedbarometric research.

DEVELOPMENT OF THE COLLECTION SYSTEM.

The New York Clearing House Associationhas adopted a new set of rules and regulationsrelating to the method of making collections formembers of the association or for others clear-ing through such members, as well as the rateto be charged for the collections in question.Simultaneous with the transmission of theseregulations, effective March 1, the Federal'Reserve Bank of 'New York has sent out underdate of February 26 a schedule showing whenthe proceeds of acceptances will be available ifcollected through the Federal Reserve Bank ofNew York. There is herewith reprinted the cir-cular sent out by the clearing house, as follows:NEW YORK CLEARING HOUSE-—RULES AND REGULATIONS

REGARDING COLLECTIONS OUTSTDE OF THE CITY OF NEW

YORK.

CEflr'ecfcive Aug. 12,1918: amended Sept 3,1918; Feb. 10.1919, eflcctiv©Mar, 1,1919.)

Pursuant to authority conferred upon it by the consti-tution of the New York Clearing House Association, theclearing house committee oi said association establishesthe following rules and regulations regarding collectionsoutside of the City of New York (except as to items onclearing nonmembers), by members of the association, orbanks, trust companies, or others clearing through suchmembers, and the rates to be charged for such collections,and also regarding enforcement of the provisions hereof:

SECTION 1. These rules and regulations shall apply toall members of the association, and to all banks, trust com-panies, or others clearing through such members, but notto branches in foreign countries of member banks. Theparties to which the same BO apply are hereinafter describedas collecting banks,

Sec. 2. For all items deposited by or collected for theaccount, of the Governments of the United States, the

State of New York, or the City of New York, from what-ever source received (but not checks, warrants, etc., issuedby said Governments and deposited by or collected for theaccount of the bank's other customers), the charge shall bediscretionary with the collecting banks.

SEC. 3, For checks or drafts drawn on banks, bankers,and trust companies, and for all other items, the chargesshall be not less than those prescribed for the respectivepoints in the following schedule, subject to the provisionsof sections 4, ft and 6:

States.Checks or drafts drawn

on banks, bankers,and trust companies!

Alabama . . . . . . . . . . . . . . . | One-tenth of 1 per cent..

Ar izona . . . . . . . . . . . .Arkansas . . . . . . .California

San Francisco..

Colorado....Denver.

,.do...do...do.

All other Items.

Connect lentDelawareDistrict of Columbia.Florida-, . ,

Georgia... . .

Atlanta,

Idaho...Illinois.,

Chicago.Indiana. . .p .

Iowa. . . . . .Kansas -

Kansas City..Kentucky

Louisville....Louisiana,

j New Orleans?

Maine.. . . .Maryland

Baltimore..Massachusetts..

Boston.

One-twentieth of 1 perper cent.

One-tenth of 1 per ccnt..jOne-twentieth ~of 1 per

cent.Discret ionary. . . . . . . . . . .. . . . .do. . . . .doOne-eighth oi" I per cent.

One-tenth of 1 per cent..

One-fortieth of l percent.

One-tenth of 1 per cent..One-twentieth of 1 per

cent.One-fortiel h of 1 per centOne-twentieth of 1 per

cent.One-tenth of I per cent..

,do

One-tenth of Iper cent;..

Do.Do.Do.D

.Do.Do.

Do.Do.Do.

One-eighth of 1per cent,

One-tenth of Iper cent.* Do.

Do.Do.

Do..Do.

One-fortieth of 1 percentOne-tenth of 1 per cent..One-fortieth of 1 per centOne-eighth of 1 per cent.

One-twentieth of 1 percent.

Discret ionary. . . . . . . . . . .do. .do.d o . . . . . . . . . . . .

Do,DOrDo.Do.

One-eighth of Iper cento

One-tenth of Iper cent,*" Do.

Do.Do.Do,

I Discretionary*1

* See section. 6,


244 FEDERAL RESERVE BULLETIN. MARCH 1,191$.

States.! Checks or drafts drawnj on banks, bankers,i and trust companies.

Michigan..

Detroit . . . . . . .Minnesota ,

Minneapolis,,St. Paul . . . . . .

Mississippi..

Missouri . . - . , .

Kansas City..St. Louis

MontanaNebraska

Omaha.

NevadaNew Hampshire.New Jersey

HobokenJersey City....

New Mexico

One-twentieth of 1 per-cent.

Ono-fortfeth of 1 per ceniOne-tenth of 1 percent..One-fortieth of I Der cent

.do

All other items.

One-eighth of 1 per csnt.


One-fortieth of 1 per cent.do

One-tenth of 1 per cent.,.do

One-twentieth, of .1. percent. i

One-tenth of 1 per coat..1

Discretionary.do

..do.

..do.

Now York

New York City.North Carolina

North Dakota..

Ohio

Ono-eighth of 1 per cent.

Discretionary

Cincinnati.Cleveland..

Oklahoma.Oregon....

Portland.,.

.do.One-eighth of 1 per cent, j

One-tenth of 1 per cent..|

One-twentieth of 1 per. fcent.

One-fortieth of 1 per cent.do

One-tenth of I per cent...do

PennsylvaniaPhiladelphia...Pittsburgh

Rhode Island...South Carolina..

South Dakota...

Tennessee..,Texas. . . . . . .

Dallas...

UtahSalt LakeCitv.

Vermont . . . . . . .Virginia

Richmond.Washington

.Seattle

Spokane...West Virginia..WisconsinWyoming.

One-twentieth of 1 percent.

D iscretionary.do.do.

..do.One-eighth of I por cent.


. . . . .do..do.

One-twentieth of 1 percent. \

One-tenth of 1 per cent..-!One-twentieth "of 1 per i

cent. " jDiscretionary jOne-tenth of l per cent. .|Discretionary .1 jOne-tenth of 1 per cent..tOne-twentieth "of 1 per j

cent. " ».do

One-tenth of 1 per cent., ,|do \ . . . . . jdo i

One-tenth of 1per cent-

Do.Do.Do,Do.

One-eighth of iper cent.

One-tenth of 1per cent.

Do.Do.Do.Do.Do.

Do,Do.Bo.

Discretionary.Do.i

One-eighth of lper cent.

One-tenth of 1per cent.

Discretionary.One-eighth of 1

per cent.One-tenth of 1

per cent.Do.

Do.Do.Do.Do.Do.

Do.Discretionary.*One-tenth of 1

per cent.Do.

One-eighth of 1per cent.

One-tenth of iper cent.

Do.Do.Do.

Do.Do.

Do.Do.Do.Do.Do.

Do.Do.Do.Do.

* See section 6.

SEC. 4. The charge for checks and drafts drawn- on banks,bankers and trust companies located in Federal Reservecities and cities where Federal Reserve Bank branchesare at present or may hereafter be established, shall begoverned by the "Schedule showing when the proceedsof items %vill become available," as published by the Fed-eral Reserve Bank of New York from, time to time; thatis to say. for such items on said cities where immediatecredit is given and for such items which become availableone day after receipt, the charge shall be discretionary;for such items available two days after receipt, the charge

shall be one-fortieth of 1 per cent; for such items availablefour days after receipt the charge shall be one-twentiethof 1 per cent; and for such items available eight days afterreceipt, the charge shall be one-tenth of 1 per cent.

SEC. 5. In case the charge upon any item at the ratesabove specified does not equal ten (10) cents, the collectingbank shall charge not less than that sum; but all items re-ceived in any one deposit and subject to the same rate,may be added together and treated as one item for thepurpose of determining the amount of exchange to becharged.

SEC. 6. (a) On acceptances of banks, bankers, and trustcompanies taken by member or clearing nonmember in-stitutions the charge shall be governed by the "Scheduleshowing when the proceeds of bankers' acceptances willbecome available," as published hj the Federal ReserveBank of New York from time to time: that is to say, forsuch items for which credit is available at the FederalReserve Bank of New York on the day of maturity, thecharge shall be discretionary; where credit is available atsaid bank one or two days after maturity, one-fortieth of1 per cent: where credit is available at said bank three orfour days after maturity, one-twentieth of 1 per cent:where credit is available at said bank later than four daysafter maturity, one-tenth of 1 per cent.

(6) All notes or ether time obligations, not provided forin subdivision (a) of this section, purchased by memberor clearing nonmember institutions payable elsewherethan in New York City, shall be subject to a charge of notless than one-tenth of 1 per cent,, except that in the Statesof Florida, Louisiana, Mississippi, New Mexico. NorthCarolina, and South Carolina the charge shall be not lessthan one-eighth of 1 per cent: Provided, however, That fornotes or other time obligations purchased or discountedby any collecting bank, payable elsewhere than in NewYork City, but with respect to which, the maker, in-dorser, or guarantor; or any bank, banker, or trust com-pany maintaining an account with the collecting bank,gives a written agreement at the time of such purchase ordiscount that payment is to be provided in New York Cityon date of maturity in New York funds at par, the chargeshall be discretionary.

SEC. 7. The charges herein specified shall in all casesbe collected at the time of deposit or not later than the10th day of the following calendar month. No collectingbank shall, directly or indirectly, allow any abatement,rebate, or return for or on account of such charges or makein any form, whether of interest on balances or otherwise,any compensation therefor.

SEC. 8. In case any member of the association shalllearn that these rules and regulations have been violatedby any of the collecting banks, it shall immediatelyreport the facts to the chairman of the clearing-housecommittee, or, in his absence, to the manager of theassociation. Upon receiving information from any sourcethat there has been a violation of the same, said chair-man, or, in his absence, said manager,, shall call a meeting



of the committee. The committee shall investigate thefacts and determine whether a formal hearing is necessary.In case the committee so concludes, it shall instruct themanager to formulate charges and. present them to the jcommittee. A copy of these charges, together with jwritten notice of the time and place fixed for hearing jregarding the same, shall be served upon the collecting jbank charged, with such violation, which shall have the jright at the hearing to introduce such relevant evidence !and submit such, argument as it may desire. The com- jmittee shall hear whatever relevant evidence may be *offered by any person and whatever arguments may be ]submitted and shall determine whether the charges are jsustained. In case it reaches the conclusion that they \are, the committee shell call & special meeting of the jassociation and report thereto 'the facts with its con- jelusions. If the report of the committee is approved by jthe association, the collecting bank charged with, such jviolation shall pay to the association the sum of $5,000, ]and in case of a second violation o! these rules and regula-)tions, any collecting bank may also in the discretion of \the association be excluded from using its privileges jdirectly or indirectly, and, If it is a member, expelled \from the association. !

Resolved, That the foregoing rules and regulations are |hereby established and adopted, to take effect upon the 312th day of August, 1918 r j

RULINGS AND INTERPRETATIONS OF SOME OF THE ITORH- j

GOING RULES AND REGULATIONS. \

(a) All applications for rulings on regulations regarding jcollection charges must be made in writing and addressed !to the clearing-hoiise committee. All rulings will, be !pnnted and sent to members and other institutions con- \nected with, the New York Clearing House. i

(b) The clearing-house rules contemplate the charging jof collection rates on all out-of-town items, from whatever \source derived, unless otherwise provided in the rules, \This ruling is made comprehensive in order to meet !|ingenious cases for evasion. j

(c) A ruling has been asked on the following:A suggestion that drafts be deposited in other than

discretionary cities with the correspondents of a NewYork Clearing House member in such cities, to the creditof such, member, the depositor to receive credit in theNew York institution at par immediately upon notifica-tion of such, deposit, and to be allowed to draw againstsuch credits the same as against New York funds-

It is held that this and similar cases are in contraventionof clearing-house rules. If exceptions were allowed, theflood of cases would practically nullify the rules.

In the case of bought paper the broker should allow thocharge as part oi: the purchase,

(d) No exception is made to the general rules governingcollection charges for items drawn "with exchange." orbearing similar phrases, or when stamped "collectible atpar through any Federal Reserve Bank." Such items

must be charged for in accordance with the within-namedrates.

Counsel has ruled that checks stamped "payable inexchange" are not negotiable; therefore, such checksshould not be accepted for deposit.

(e) 'When items subject to collection charges are re-turned unpaid, the charge may be remitted,

{/) Stocks, bonds, and coupons and drafts with bills oflading or collateral attached are subject to the rules gov-erning collection charges,

(g) Any agreement, expressed, or implied, entered intoby a clearing-house member or by a nonmember clearingthrough a member, with any individual, firm, or corpora-tion. by the terms of which it is intended that the rateof interest agreed to be paid on deposits is to offset andcompensate for charges made on out-of-town checks, is aviolation of clearing-house rules, and if brought to theattention of the committee, will be dealt with as providedby section 8 of the clearing-house rules and regulationsrelating to the charges on out-of-town items}.

The- circular transmitted by the FederalReserve Bank of New York referred to is asfollows:

[Circular No. 147. Federal Reserve Bank oi New York. Feb. 26,3919.Schedule showing when proceeds of bankers'* acceptances will beavailable if collected through the Federal Reserve Bank of New York.]

On and after March 1, 1919, bankers' acceptances willbe received by the Federal Reserve Bank of New Yorkfor collection from its member banks and from FederalReserve Banks, but bankers' acceptances payable at NewYork Clearing Souse banks will not be .received fromclearing-house members.

By arrangements completed with all other FederalReserve Banks the proceeds of bankers' acceptances pay-able in cities where Federal Reserve Banks or theirbranches are at present or may hereafter be establishedwill be available, subject to payment, on day of maturity.

Proceeds of bankers' acceptances payable elsewherethan in Federal Reserve or Federal Reserve branch citieswill be available, subject to payment, one or more daysafter maturity, until further 'notice; in accordance withthe following schedule:

District.

1. Boston2. New York3. Philadelphia..4. Cleveland

S. Richmond,

Credit available at | Credit, for items payablematurity for items ] elsewhere in districtpayable In— ? available,

Boston, Mass .....i Ida:New Yorfc,N. Y ;

Buffalo, N*. Y. ! Do,Philadelphia, Pa ; Bo.Claveianil, Ohio........1 Do.

iy alter maturity,

Cincinnati, Ohio......Pittsburgh, Pa.Richmond, Va.

Baltimore, McL

Do.Do.

2 days after maturity forMaryland. District ofColumbia, and Virpir.ia:3 days after maturityfor West Virginia, NorthCarolina, and SoutoCarolina.

Da


24:8 FEDERAL RESERVE BULLETIN MARCH 1,1010.

District.Credit available at

maturity for itemspayable in—

Credit lor items payableelsewhere in districtavailable.

6. Allanta , Ga.

7. Chicago.,,...,

8. St. Louis—

9. Minneapolis...

10. Kansas City...

New Orleans. La. ]Jackson ville,'FU...... iBirmingham. Ala. . . . . jChicago, 111. . . . . . . . . . . . .Detroit, Mirti. . . . .St. Louis, Mo..Louisville, fCj . . . . . . . . .Mom phis, TennLittle Rock, Ark. . . . . .Msruiaapoli?, MinnSt. Paul, Minn... ,Kansas City, Mo |On>aha,Ncbr ...i

I Denver, Colo. ....•!L Dallas i Dallas. Tex

| El Paso, Tex12, Ban Francisco.! San Francisco, Cal

! Spokane, Washi Portland, Orog.i Peat tit\ Was hi1 Salt Lake Cifcv. Utah..

I day after maturity foracceptances of memberbanks only; acceptancesof Ronmembers w&encollected.

Do.Do.T>o.

I day after maturity.bo.Do.Do.."Do.Bo.Do.Do.Do.Do.Do.Do.Do.Do.Do,Do.Do.Do.

ACCEPTANCE COLLECTION SCHEDULEADOPTED BY ALL FEDERAL RESERVE BANKS.

The Federal Reserve Board has been advisedby all Federal "Reserve Banks that they are pre-pared to collect bankers' acceptances receivedfrom, or for the account of any Federal ReserveBank, and that, subject to final payment, pro-ceeds of such acceptances will be available inaccordance with the schedule printed above.The items to be collected must be received bythe collecting Federal Reserve Bank or branchin time for the presentation at maturity to theaccepting bank or the bank designated as theplace of payment.

The Industrial Board of the Department ofCommerce.1

Having received approval from the Presidentof the plans proposed to readjust prices,"The Industrial Board of the Department ofCommerce'7 has been formed, composed ofrepresentative men from industry, labor, andthe Government, who are being selectedunder the chairmanship of George N. Peek,formerly vice chairman of the War IndustriesBoard. They are to put into practical effect

' OHieial press statement,

a program for the readjustment of prices forbasic materials in such a fashion as to createa firm foundation on which the consumer canbase his future purchases, and the producercan form necessary estimates. The IndustrialBoard has the assistance of the Council ofNational Defense.

The following is a summary of the industrialsituation and an outline of the work of theboard.

GENERAL CONDITIONS.

1. There exists at the present time an abnormal situationin the industrial world. It is a condition of stagnationof business and industrial activity. Mills and factoriesare idle or are producing but a small part of what they arecapable of doing; building operations, now deferred forseveral years, are not beginning, and, in fact, resumptionis not contemplated until the confused conditions of thetransition period are clarified. Many enterprises, such asstreet-railway companies in various municipalities,laboring under restrictions of charter contracts, are con-fronted with advanced wage scales and unprecedentedprices of materials needed for repairs and necessaryextensions. Unemployment exists and this unemploy-ment is increasing at such a rate as to challenge the best•thought that can be given to the situation.

2. One of the striking features of the present situationis the high prices demanded for practically all articlesand commodities of trade and commerce. This high-pricecondition is undoubtedly the cause of most of the businessinactivity and, therefore, also is the cause of the wide-spread unemployment of labor.

3. The living costs of the present are unusually highand will continue high until there are substantial reduc-tions in the cost of the necessary staple foodstuffs.

4. A large and it is believed satisfactory latent buyingpower exists in the country—an abundance of money-but it is not being used to employ labor and to purchasegoods and materials.

5. The present conditions have come about by a series ofunusual happenings due to the war. The industries andlabor of the country were diverted into new and unnaturalchannels in order to mobilize all efforts possible in thewinning of the war.

The capacities of many factories were expanded, newones built, abandoned plants remodeled and put intoproduction, and industry was managed and operated inaccordance with war necessities.

This control and direction of effort and change of policiesresulted in the complete suspension of the ordinary opera-tion of the law of supply and demand, the demand for warcommodities, and the necessary agreements with indus-tries as to prices and terms of conversion of industry to warwork, etc., had the effect of inflating prices to an abnormalextent, so as to encourage maximum production, even by


MARCH 1,1919, FEDERAL RESEBVE BULLETIN. 247

producers operating under the greatest handicaps and at thehighest costs. Prices were advanced disproportionately,some articles showing increase in selling prices over prewarprices of 250 per cent, while others showed but approxi-mately 50 per cent. The lav/ of supply and demand isreally inoperative at the present time, for the reason thatit is found difficult, if not impossible^ for this law to resumenormal functioning on account of the fact that at the pres-ent time the price relations between the industries pro-ducing basic essentials are out of balance and not properlyadjusted to efficiently meet peace-time conditions,

8. It therefore is apparent that the trouble .resulting inthe present stagnant, unsatisfactory condition of industryis due to the continuance of the high, uneven, unstableprices of war times, which were, in many instanceu,agrectito by agencies of Government functioning for war purposesand not to any unhealthy general condition. These ab-normal prices still remain because there has been provided,up to'this time, no agency to bring about the necessaryreductions.

SOME SUGGESTIONS WBICH OUGHT TO BE OBSJSRVKD IN

SEEKING A SOLUTION OF THE PROBLEM.

1. A wise solution is equally important to the Govern-ment, to industry, and to labor, for their true interests areso indissolubly connected and united that no detrimentcan be suffered by one without a harmful effect and reac-tion upon the others.

2, The vital need of the situation is resumption of indus-trial activity to the fullest extent possible, and it should bethe aim to find the wisest and most effective way to accom-plish this.

8. It is felt that the proper basis of selling prices for thepresent will be found to be upon a scale higher than thoseof the prewar days. However, the level should be estab-lished on the lowest plane possible, having due regard forindustry, labor, and Government. The announcement ofsuch a plane of prices will immediately create confidencein the buying public.

4. It is believed that the reductions from the high pricesto the proper level, so that consumers may be justified inbuying, should be made at once by one reduction.

The effort should be to wholly eliminate the abnormal,unbalanced stimulation that business has had and theInflated prices that have resulted, and to start anew uponB, normal level, and thereafter, industry, having adoptedthat level, can safely rely upon the law of supply and de-mand to govern future values. Such a policy adopted andannounced will, it is believed, when understood hy theconsumers, induce at once sufficient buying to start fac-tories, fill empty yards and warerooms, &&d to inauguratethe interrupted building and other programs.

5. Industry and labor have a mutual interest in remedy-ing present conditions, but Industry should take the firststep by the reduction of prices of commodities and. shouldrequire of labor only reasonable aid.

PROGEDti RE—REMEDY,

1. It is h&iieved that a remedy for these conditions canbe had hy a comparatively simple program. As thePresident has approved my appointing a board whichwill make a study of the subject and take action thereonand as it will be made plain that the Department ofCommerce and its board has the support of the President,there can be no doubt that .industry generally will beglad to cooperate with the board in an endeavor to arriveat & solution of the difficulties.

2. Therefore, one of the first steps which the boardshould take would be to call Into consultation and con-ference the leaders of Industry in such numbers and bysuch groups as It may be felt is wise. Probably the firstof these conferences should be with representatives ofindustries producing basic materials, such as Iron, steel,lumber, textiles, cement, copper, brick, and other con-struction materials, and from, time to time thereaftersuch others as may be deemed proper. It Is believed,however, that industries dealing In finished productswill be able to largely (if not entirely) adjust their pricesin line with the above policy without material aid from,the committee.

3. At such conferences the general situation or condi-tions outlined above and as they may change up to thetime of the conference should be considered and carefullyunderstood, and the above mentioned principles whichought to apply and govern the solution of the problemsshould a'iso be fully understood Mid appreciated. It•is believed that these principles and views will be readilyaccepted by the great; majority of those called into con-ference and further that if any of those who come intoconference question these principles and views, a discus-sion thereof in the conference will, without any consider-able delay, lead to a unanimous acceptance thereof.

4. In addition to giving assistance to industry in reach-ing satisfactory price bases the board ought to be able togive valuable advice in regard to such questions as thedisposal of surplus war materials, it being desirable toaccomplish this in such a way as to have as little detri-mental effect as possible upon private industrial activities.

It will be the endeavor of the board to act promptlyby consulting and interchanging views with these repre-sentatives of industry In the fullest and freest mannerpossible, with a view to aiding and assisting industry ingeneral to resume activities to the fullest practicableextent. The immediate object is to bring about suchreduced prices as will bring the buying power of theGovernment Itself, including the railroads, telephones,and telegraphs, into action and make it possible for the

j Government to state that it is •willing to be a buyer forj its needs at the reduced prices. If these conferences

result in such an understanding on the part of theGovernment with respect to the Important basic indus-tries concerning proper prices and base* for prices at


248 FEDERAL RESERVE RT7LLETIK. MAECH 1,

which purchases may be made by it, and these areapproved by the board, It is believed that upon announce-ment thereof to the country in general the public willfeel justified in promptly beginning a program of extensivebuying.

Such a procedure will in substance establish Imme-diately a basis upon which to resume activities, and inthis way the law of supply and demand will be enabledto come into play, and from thattime forward it willcontrol the changes and readjustments in selling pricesof materials and the trend of prices, it is believed, willbe upward and not downward.

(Signed) WILLIAM C. REDFIELD,Secretary of Commerce.

Conditions In the Gold Mining Industry.

The following report lias been rendered tothe Secretary of the Treasury under date ofFebruary 11:

SIR: On November 2, 1918, your predecessor appointedthe undersigned a committee to investigate present con-ditions in the gold mining industry and to study theproblem carefully and thoroughly with a view to definitelyascertaining ail the difficulties confronting gold productionand submitting suggestions of sane and sound methods ofrelief.

The nature of the problem submitted to the committeewas well stated in the letter of Secretary McAdoo to Dele-gate Sulzer of Alaska, under date of June 10,1918, to whichreference has been made in almost all resolutions or dis-cussions of the subject since that time. * * *

At that time the war was at its height and there wasevery prospect of a prolonged war. Contrary to the beliefapparently entertained in many quarters, the structure ofbanking credit in any country during war time does notdepend very much, if at all, on the amount of gold thatcan be made available as a reserve for that structure.Undoubtedly the rise in prices in this country since 1914is to a great extent due to the heavy importations of goldduring 1915 and 1916, but it does not follow that the exportof a corresponding amount of gold at the present timewould operate to bring down prices. As a matter of factit is the judgment of this committee that it would not sooperate until we have reached or approached normalpeace conditions. In time of peace the gold reserve isundoubtedly an important factor in controlling the creditstructure, but in time of war that structure is determinedby other causes. This distinction is sometimes overlookedand much inaccurate thinking is due to this oversight.Under war conditions the imperative necessity of tha Gov-ernment for the production of war essentials determinesGovernment expenditure, and this expenditure can notbe modified to meet the banking needs of the country; onfr>b.e contrary, the banking policies! of the country must

conform to the fiscal policy of the Government. Underthese circumstances the only way in which the expansionof banking credits can be checked is by a reduction of civildemands to correspond with the expanding needs for Gov-ernment expenditure. The credit saved through this re-duction of civil damands becomes available to the Govern*merit through the purchase of Government securities orthrough the payment of taxes. To the extent to whichsuch saving and resulting investment does not take placeGovernment obligations must be taken by the banks,giving rise to credits to tho Government which createadditional purchasing power for the use of the Govern-

j ment. This additional purchasing power, in turn, com-j petes with the demands of private individuals, driving

up prices against the Government and against the civilconsumer and ultimately impairs the individual's pur-chasing power to an amount roughly equivalent to theimpairment that might better have been brought aboutthrough voluntary saving. The credit structure" thuserected depends inevitably upon Government needs andupon the willingness and ability of the community toimpose upon itself voluntary restraint in expenditure.In other words, the structure will be high if the communityfails to save.

The results in {saving achieved in the United States wereremarkable but no program of saving can be instantlyput in effect and the expansion of the credit structurethat took place under these circumstances was inevitableand could not have been controlled through any reductionin the gold reserve.

This being so and a long war being believed in prospect,it was important to maintain a strong gold reserve in orderthat there might be no impairment of confidence in theconvertibility of our currency and in our ability ultimatelyto settle any international indebtedness in gold.

The cessation of hostilities has radically changed thissituation, and with the change in the situation any needof particular effort to promote or stimulate our gold pro-duction which may have existed has ceased. There isnow no danger of an impairment of confidence. Thedimensions of our financial problems are becoming clearand we know that we can without permanent strain meetany financial requirement the Government will be willingto assume. Some further expansion of credit may resultfrom our expenditures for demobilization and readjust*ment but we can look forward to a comparatively earlycontraction of our credit structure with the attending cir-cumstances of a free gold market and a gold reserve thatshall once more perform its normal function of regulatingcredit conditions. That movement will, we believe, beboth preceded and accompanied by lower commodityprices.

Under these circumstances, there is in our opinion notneed for artificial stimulation of gold production. Notonly has any need therefor passed, but there have comento operation causes that will in due time restore allindustry, including the mining of gold, to a normal basis-


MARCH 1,1919. FEDEEAL EESEEVE BULLETIN. 249

Gold mining will then become again normally profitableand respond automatically to normal stimuli.

It is therefore the judgment of this committee that nosteps should be taken by the Government to stimulate orpromote the production of gold.

The representatives of the gold-mining interests veryproperly based their suggestions for relief on the publicnecessity for a larger production of gold and not on thehardships suffered by them as parties interested in anindustry in which the margin of profit had been rapidlyshrinking, and in many cases had entirely disappearedor been turned into a loss. They recognized that suchdiminishing profits and such losses were inevitable underthe shifting conditions of war, and that merely as producersthey had no better claim to relief than any other section ofthe community suffering a reduction of profits or incurringlosses under the changing incidents of war conditions.

In the course of its consideration of the subject referredto it, this committee has conferred with a committeeappointed by the American Gold Conference held at Renoin August, 1918, under the presidency of Gov. Emmet D.Boyle, of Nevada. It has had the benefit of the very com-plete survey of the conditions of the gold-mining industrycontained in the report dated October 30,1918, of the com-mittee appointed by the Secretary of the Interior to studythe gold situation, of which Hennen Jennings, Esq., waschairman; and of the report dated November 29, 1918, ofthe gold-production committee appointed by the commis-sioners of the British treasury under the chairmanship ofLord Inchcape. They have conferred with or secured theviews of Prof. Irving Fischer and other eminent econo-mists, besides which they have had referred to them aconsiderable volume of correspondence expressing widelyvarying views which had been received by the Secretaryof the Treasury and the Director of the Mint.

It is interesting to note that the British treasury com-mittee arrived at the same conclusion as that which wehave reached.

We can not refrain from expressing gratification at thesubstantial unanimity of opinion among those whose posi-tion or experience entitles their views to respectful con-sideration against suggested measures of relief that wouldhave had a tendency to undermine or upset our standardsof value.

Respectfully submitted.ALBERT STRAUSS.EDWIN F. GAY.RAYMOND T. BAKER.EMMETT I). BOYLE.POPE YEATMAN.

| reporting discount and interest on time loansfor taxation purposes:

F E B R U A R Y 11, 1919.

Receipt is acknowledged of^your lettei^of Feb rua ry 8,i 1919, i n which you s ta te :" "" '"*" •*•*—"i*" 4J

| ^' On Janua ry 1,1918. we changed our method of hand l ing| discount and interest on time loans. Up to this time alli discount and interest charged on loans had been credited1 directly to discount and interest, but at this date, theactual amount of discount and interest, which had beenso credited and was still unearned, was ascertained,credited to unearned account on our boolcs, and thereafterall discount and interest collected in advance was creditedto this account, our discount earned receiving creditfor each day's actual earnings."

You ask to be advised what course you should pursue inthe preparation of your income and war-excess profits taxreturns for the year 1918. The method of treating discountand interest on time loans adopted by you on January 1,1918, has been generally recognized as the correct methodof computing such income, and the Comptroller of theCurrency has suggested the adoption of this method by allnational banks. The amount of income from discountand interest on time loans which you should report forthe year 1918 is the amount of such income actuallyearned during that year, and as the amount of such incomefor the year 1917 and years prior thereto has been computedand reported upon a different method, amended returnsshould be filed showing the correct amount of such incomefor each year back to 1909, inclusive, or to the date of theorganization of your bank, if it was organized subsequentto^l.909.

(Signed) DANIEL C. ROPER,Commissioner.

Computation of Discount and Interest forTaxation Purposes.

The Commissioner of Internal Revenue hasauthorized the publication of the followingletter written in response to an inquiry froma national bank with reference to the method of

Method of Reporting Certain Items in Comp-troller's Call.

On November 1, 1918, the Comptroller ofj Currency sent to all national banks the follow-ing notice:

'l As it has been the custom of many nationali banks to credit discounts as collected direct toj profits and to credit profits with accruing in-I terest only after actual collection, it has been! thought proper to give the banks a reasonable| time to make the adjustments which will berequired in order to report accurately items21 and 27 (interest earned but not collected,and interest collected but not earned).

"Therefore national banks may exercisetheir discretion on this call as to includingitems 21 and 27 in this report of condition(i. e., Nov. 1, 1918). Banks will, however, berequired to report these items correctly fromJanuary 1, 1919. They have had a reasonableopportunity to adjust their books to show theseitems accurately. Notice has been printed in


250 FEDERAL RESERVE BULLETIN. MARCH1 1,1919.

each report of condition since December 31,1917, that banks should prepare for thischange."

On December 28, 1918, the Comptroller noti-fied the banks that, due to the shortage of helpoccasioned by sickness and the extra workwhich the Government loans had entailed,compliance with the above notice would not becompulsory for the present.

Condition of National Banks.The Comptroller of the Currency on Febru-

ary 10 issued the following statement relativeto the condition of national banks:

For the first time in their history the resources of ournational banks, at the last call. December 31. 1918. passedthe $20,000,000,000 marl: and amounted to 820,042.224.000.This is an increase of 8220,820,000 over the preceding callof November 1, 1918, and an advance as compared withDecember 31, 1917. of 81,968,916,000. These extraordi-nary figures tell us that the total resources of the nationalbanks of the United States have more than doubledsince January 7, 1911, when they amounted to only$9,820,483,000, the increase in eight years having been810,221,741,000.

The following figures give a comparison between thestatements of November 1, 1918. and December 31, 1918:

Deposits aggregated 815,423.081,000, an increase of1371,608,000 over the greatest deposits ever previouslyreached. Of the increase in deposits, 8101.356.000 wasrepresented by time deposits, the remainder of the increasewas in amount due to banks and bankers. Demanddeposits showed a slight reduction.

Loans and discounts December 31, 1918, amounted to89,918,294,000. a reduction as compared with November 1,1918, of 8178,646,000. The percentage of loans and dis-counts to deposits November 1. 1918, was 67.08 per cent,and on December 31, 1918, these had been reduced to64.31 per cent.

Bills payable and rediscounts on December 31, 1918,were 81,380,835,000, a reduction as compared with Novem-ber 1, 1918,' of $186,156,000.

Of the $1,380,835,000 of bills payable and rediscountsoutstanding December 31, 1918, 8817,264,000 were billspayable with the Federal Reserve Banks; 861,564,000were bills payable with other than Federal ReserveBanks, while the liability for rediscounts due FederalReserve Banks and others amounted to 8502,007,000.

United States bonds, including Liberty bonds andUnited States certificates of indebtedness, held Decem-ber 31. 1918, amounted to $2,949,878,000, a reduction sinceNovember 1. 1918. of 8206,434,000.

Other bonds, securities, etc.. on December 31. 1918,amounted to §1,683,071.000. an increase of $22,606,000.

Capital, surplus, and undivided profits of national bankson December 31, 1918, amounted to $2,293,613,000.

The circulation of national banks December 31, 1918,was §676,827,000, an increase of Si,129,000, as compared

with November 1, 1918, and an increase of $2,573,000, ascompared with the same date of previous year.

The amount of Liberty bonds of the first, second, third,and fourth loans owned by national banks on December 31,1918, was reported at 8955,935,000, or 5.62 per cent of the117,000,000,000 Liberty bonds placed.

In addition to the Liberty bonds the national banksreported holdings of United States certificates of indebted-ness on December 31, 1918, amounting to $982,125,000.

On December 31, 1918, the national banks reported thatthe amount of money loaned by them on the security ofLiberty bonds was 81,020,436,000, and the amount ofmoney loaned by them on the security of certificates ofindebtedness was §36.607,000.

The reports show that the amount of Liberty bonds of allfour issues owned by national banks in the central reservecities of New York,Chicago, and St. Louis was $172,616,000;in other reserve cities $250,707,000, and by the countrybanks §532,612,000.

Of the United States certificates of indebtedness heldby the national banks., 8358,532,000 were owned by thenational banks of the three central reserve cities;$266,419,000 by national banks in other reserve cities, andby the country banks, 8357,174,000.

Of the money loaned by the national banks on Libertybonds, the national banks of the three central reservecities were loaning $423,677,000; national banks in otherreserve cities were loaning 3345,943,000; while the countrybanks were loaning on Liberty bonds §250,816,000.

Of the 836,667,000 which was being loaned on UnitedStates certificates of indebtedness, the central reservecities were loaning §13,875,000; national banks in otherreserve cities were loaning $20,249,000; while the countrynational banks were loaning 82,543,000.

Of the §955,935,000 Liberty bonds owned by nationalbanks only 836,589,000 were the 3J per cent bonds of thefirst issue.

State Banks and Trust Companies Admitted.

The following list shows the State banks andtrust companies which have been admitted tomembership in the Federal Reserve Systemduring the month of February.

Nine hundred and seventy-three State in-stitutions are now members of the system,having a total capital of §352,817,051, totalsurplus of $403,812,242, and total resources of$7,382,801,351.

District No. 2.

The Hamilton Trust Co., Paterson, N. J..

District No. 4.

Union Banking Co., Columbiana, Ohio. . .Farmers Bank, McCutchinville, OhioCitizens Bank, Shelby, Ohio

tat

$500,000

50,30,

100,

000000000

Sur-plus.

§400,000

25,000

* "46," 666"

Totalresources.

89,408,688

605,190119,921

1,186,778



District No. 5.The Home Bank. St. Matthews, S. C

District No. 6.

Fickens County State Bank, Carroilton,Ala . . .*

District No. 7.

Ridgely-Farmers State Bank, Springfield,

Fanners State "Bank, Col'fax, indFirst Commercial Bank, Pontiac, Mich...Wayne Savings Bank, Wayne, Mich

District No. 9.

State Savings Bank, Laurium, Mich

District No. 10.

The Conqueror Trust Co., Joplin, Mo

District No. 11.

Wellington State Bank, Wellington, Tex.Guaranty State Bank & Trust Co., Gates-

ville, Tex

District No. 12.

Stockgrowers Bank & Trust Co., Poca-tollo, Idaho

Iron Commercial & Savings Bank, CedarCity Utah

Cap-ital.

$25,000

60,000

600,00025,000

200,00050,000

100,000

125,000

50,000

50,000

138,580

50,000

Sur-plus.

325,000

150,0001,000

80,00050,000

125,000

75,000

25,000

8,000

3,000

1,000

Totalresources.

$325,553

60.000

750,000234,014

3,074,264981,832

1,388,212

2,286,266

357,166

304,255

797,852

217,677

The following members of the Federal Reserve System have con-verted into national banks: Farquahar Savings Bank, College Springs,Iowa; Union Bank of Jaclcson, Mich.; Redmond Bank of Commerce,Redmond, Oreg.

Acceptances to 100 Per Cent.

Since the issue of the February BULLETIN thefollowing banks have been authorized by theFederal Reserve Board to accept drafts and billsof exchange up to 100 per cent of their capitaland surplus:

Atlantic National Bank, Jacksonville, Fla.Fletcher American National Bank, Indianapolis, Ind.International Trust Co., Boston, Mass.Commonwealth Trust Co., Boston, Mass.

Fiduciary Powers Granted to National Banks,

The applications of the following banks forpermission to act under section ll(k) of theFederal Reserve act have been approved by theFederal Reserve Board during February:

DISTRICT No. 2.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, receiver, and com-mittee of estates of lunatics:

Little Falls National Bank, Little Falls, N. Y.State National Bank, North Tonawanda, N. Y.First National Bank, Port Jervis, N. Y.Farmers & Manufacturers National Bank, Pough-

keepsie, N. Y.Farmers National Bank, Rome, N. Y.Nassau National Bank, Brooklyn, N. Y.Carthage National Bank, Carthage, N. Y.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, receiver, and com-mittee of estates of lunatics—Continued.

National Bank of Commerce, New York City.Union National Bank, Troy, N. Y.Oneida National Bank, Utica, N. Y.Ilion National Bank, Ilion. N. Y.First National Bank, Brooklyn, N. YPeoples National Bank, Hoosick Falls, N. Y.Westchester County National Bank, Peeksldll, N. Y.

Guardian of estates, assignee, receiver and committee ofestates of lunatics:

Lambertville National Bank, Lambcrtville, N. J.Trustee, executor, administrator, guardian of estates,

assignee and receiver:National Bank of Vcmon, Vemon, N. Y.

DISTRICT NO. 3.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, receiver and com-mittee of estates of lunatics:

First National Bank, Huntingdon, Pa.First National Bank, Wrightsville, Pa.National Bank of Chester County, West Chester, Pa.Philadelphia National Bank, Philadelphia, Pa.

Guardian of estates, assignee, receiver and committee ofestates of lunatics:

Wyoming National Bank, Wilkes-Barre, Pa.

DISTRICT NO. 4.

Trustee under a will, registrar of stocks and bonds, trusteeunder a mortgage securing an issue of bonds, and suchother trust capacities, if any, as the proper courts in Ohiomay authorize:

Fifth-Third National Bank, Cincinnati, Ohio.Merchants National Bank, Dayton, Ohio.Winters National Bank, Dayton, Ohio.Lebanon National Bank, Lebanon, Ohio.First National Bank, Hamilton, Ohio.Central National Bank, Marietta, Ohio.First National Bank, Bellaire, Ohio.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, receiver and com-mittee of estates of lunatics:

W'arren National Bank, Warren, Pa.

DISTRICT No. 6.

Guardian of estates and receiver:First National Bank, Tuskaloosa, Ala.First National Bank, Mobile, Ala.

Guardian of estates, assignee, receiver, and committee ofestates of lunatics:

Peoples National Bank, McMinnville, Tenn.LaGrange National Bank, LaGrange, Ga.

Trustee, executor, administrator, guardian of estates, andreceiver:

Anniston National Bank, Anniston, Ala.Guardian of estates and committee of estates of lunatics:

Fourth and First National Bank, Nashville, Tenn.

DISTRICT NO. 7.

Trustee, executor, administrator, guardian of estates,assignee, and receiver:

Old Second National Bank, Aurora, 111.Joliet National Bank, Joliet, 111.Third National Bank, Rockford, 111.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, and receiver:

First National Bank, Linn Grove, Iowa,First National Bank, Everly, Iowa.



DISTRICT NO. 8.


Hannibal National Bank, Hannibal, Mo.National Bank of Commerce, St. Louis, Mo.

Trustee, executor, administrator, guardian of estates,assignee, and receiver:

Farmers & Merchants National Bank, Nashville, 111.

DISTRICT NO. 9.


First "National Bank, Bemidji, Minn.First National Bank, Albert Lea, Minn.Fergus Falls National Bank, Fergus Falls, Minn.

DISTRICT NO. 10.


Inter-State National Bank, Kansas City, Mo.Trustee, executor, administrator, registrar of stocks and

bonds, guardian of estates, assignee, and receiver:Commonwealth National Bank, Kansas City, Mo.

Guardian of estates, assignee, receiver, and committee ofestates of lunatics:

Tootle-Lacy National Bank, St. Joseph, Mo.

DISTRICT NO. 12.

Trustee, executor, administrator, registrar of stocks andbonds, guardian of estates, assignee, receiver, andguardian of estates of lunatics:

National Bank of Commerce, Seattle, Wash.Trustee, executor, administrator, registrar of stocks and

bonds, guardian of estates, assignee, and receiver:First National Bank, Pullman, Wash.

Commercial Failures Reported.

Thus far the economic readjustments whichhave inevitably followed the war's ending havebrought no increase in the country's businessmortality. Maintaining the highly favorablefeatures which have characterized the returnsfor a long period, commercial failures in theUnited States during three weeks of February^as reported by R. G. Dun & Co., numberedonly 459, as against 752 in the same weeks of1918, when the record was also gratifying. Theexhibit for January, the latest month for whichcomplete statistics are available, discloses only673 insolvencies, with $10,736,398 of liabilities.Not only are these figures well below the 1,178defaults, involving $19,278,787 of January,1918, but the number of reverses is the smallestof any January on record, and only in Januaryof 1905, 1900, 1899, and 1898 was the indebted-ness below this year's. Comparing the Janu-ary statement by Federal Reserve districts, it

is seen that failures are fewer in number thanin January, 1918, in all of the 12 districtsexcept the eighth and eleventh, where nochange appears. In most cases the reductionsare sizable, while only in the third, fifth, andeleventh districts are increased liabilities shown.

Failures during January.

Districts.

FirstSecondThirdFourthFifthSixthSeventhEighth.. .NinthTenth .EleventhTwelfth

Total . . . .

Nur

1919

6613435583443746025264870

673

nber.

1918

16024351953959

18360416248

137

1,178

Liabilities.

1919

8850,3453,258,200

976,4641,103;950

617,155376,517988,347654,396203,589320,331695,082692,022

10,736,398

1918

81,671,6155,474,984

705,6921,292,797

496,483391 985

2,581,533981,566316,366

3,932,938455,538977,290

19,278,787

New National Bank Charters.

The Comptroller of the Currency reports thefollowing increases and reductions in the num-ber of national banks and the capital of na-tional banks during the period from February1, 1919, to February 28, 1919, inclusive:

Banks.New charters issued to 11With capital of $575,000Increase of capital approved for 37With new capital of 2.125,000Aggregate number of new charters and banks

increasing capital 48With aggregate of new capital authorized 2, 700, 000Number of banks liquidating (other than

those consolidating with other nationalbanks under the act of June 3,1864) 10

Capital of same banks... 1,450, 000Number of banks reducing capital 4Reduction of capital* 2,080,000Total number of banks going into liquidation

or reducing capital (other than those con-solidating with other national banks underthe act of June 3, 1864) 14

Aggregate capital reduction 3, 530, 000Consolidation of national banks under the

actof Nov. 7, 1918 2Capital 3, 000,000The foregoing statement shows the aggregate

of increased capital for the period of theI banks embraced in statement was 2, 700,000I Against this there was a reduction of capital| owing to liquidation (other than for'con-| solidation with other national banks under! the act of June 3, 1864) and reductions ofI capital of 3, 530, 000

| Net decrease 830,000

1 Includes two reductions of capital aggregating $2,045,000 incident toconsolidations under the act of Nov. 7,1918.


MARCH 1,1919. FEDERAL BESEEVE BUIXETIK". 253

RULINGS OF THE FEDERAL RESERVE BOARD.Below are published rulings made by the

Federal Reserve Board which are believed tobe of interest to Federal Reserve Banks andmember banks.

Bankers' acceptances against open accounts of foreignpurchasers.

National banks can not accept drafts for thepurpose of enabling domestic concerns to ex-tend credits on open account to foreign pur-chasers.

[See opinion of General Counsel in Law .Department.]

Domestic acceptances—Security and limitations.

Although section 13 of the Federal Reserveact authorizes member banks to accept draftsdrawn in domestic transactions only whensecured at the time of acceptance by attachedshipping documents or warehouse receipts orother such documents, nevertheless the securitymay properly be released after acceptance;provided, however, that in any case where thetotal amount accepted for any one customerexceeds 10 per cent of the capital and surplus ofthe accepting bank the security can not bereleased unless some other actual security

growing out of the same transaction is sub-stituted therefor. A trust receipt which per-mits the customer for whom the draft isaccepted to obtain control of the goods is notactual security for the purposes of this sectionof the law.

Although the Federal Reserve Banks legallymay rediscount any draft which section 13authorizes a member bank to accept, neverthe-less such reserve banks are not required bylaw to rediscount every such acceptancetendered to them for that purpose, whether ornot it is secured at the time it is presented forrediscount.

[See opinion of General Counsel in Law Department.]

Section 22 of the Federal Reserve Act.

The Federal Reserve Board is of the opinionthat there is nothing in the provisions of sec-tion 22 of the Federal Reserve Act, as amendedby the act of September 26, 1918, to prohibitan officer of a national bank from receiving areasonable commission for his services astrustee in a foreclosure proceeding in which hisbank is interested as a general creditor.



LAW DEPARTMENT.The following opinions of General Counsel

have been authorized for publication by theBoard since the last edition of the BULLETIN:

BANKERS' ACCEPTANCES AGAINST OPEN AC-COUNTS OF FOREIGN PURCHASERS.

An opinion has been asked on the followingstatement of facts:

"We should like to have your opinion andadvice as to a certain method of financingexport business, which has been proposed tous by one of our good customers, who are ofunquestioned standing.

"The company in question finds that com-petition, particularly with European sellers, iscompelling them to refrain from drawing drafts,either sight or time, against shipments to cer-tain big buyers abroad. These buyers insiston having goods sent to them on open account,and as the terms are frequently as long as 90days, or even 4 months, it means that for aSouth American shipment a delay of 6 or7 months can easily elapse from time of ship-ment from New York to receipt of proceedsin New York, even when the bill is paid with-out extension of original terms. To help himfinance such a class of business, he proposesthat at regular intervals (to illustrate, once aweek) he will exhibit duplicate invoices andduplicate documents, showing shipments actu-ally made during the past week, and ask usto accept his time draft on us, for 90 days, withprivilege of one or two renewals, if necessary,to aid him in carrying the load on these exportsuntil returns are received/7

The question to be determined is whetherdrafts drawn under the foregoing circumstancesmay be treated as growing out of a transactioninvolving the importation or exportation ofgoods ?

Although it is clear that there has been anexportation of goods, it does not appear thatthe drafts in question can be said to have grownout of the transaction which involved the ex-portation, within the meaning of the act.

As previously pointed out the language usedin the act is broad enough to vest in the Boarda wide discretion to determine how remotely or

how directly the drafts drawn must be con-nected with the transaction involving the ex-portation. Considering the general purposesof the act, however, it is clearly contemplatedthat these credits were to be opened for thepurpose of facilitating international commerce;that is to say, to enable the parties to thetransaction actually to export and sell thegoods. It was hardly the intention of Congressto authorize member banks to exercise thispower for the purpose of enabling domesticconcerns to extend credits on open account toforeign purchasers. In the opinion of thisoffice the approval of this credit would requirea forced construction of the provisions of sec-tion 13 of the Federal Reserve Act.

JANUARY 29, 1919.

DOMESTIC ACCEPTANCES—SECURITY AND LIMI-TATIONS,

It appears that some confusion of thoughtexists in the minds of certain officers of FederalReserve Banks and member banks as to theBoard's interpretation of those provisions ofsection 13 of the Federal Reserve Act whichrelate (1) to the power of member banks to ac-cept drafts drawn in domestic transactions;(2) to the eligibility for rediscount by FederalReserve Banks of member bank acceptances.

It is understood that the provisions in ques-tion have been interpreted by the Board invarious rulings, as follows:

POWER OF MEMBER BANKS TO ACCEPT DRAFTS DRAWN

IN DOMESTIC TRANSACTIONS.

Subject to the limitations prescribed by theAct, member banks are authorized—

(a) To accept drafts or bills of exchangewhich grow out of transactions involv-ing the domestic shipment of goods,provided shipping documents convey-ing or securing title are attached at thetime of acceptance.


MARCH 1, 1919. FEDERAL. RESERVE BULLETIN. 255

(h) To accept drafts or bills of exchangewhich are secured at ilie time of accept,ance by warehouse receipts or othersuch documents conveying or securingtitle covering readily marketable sta-ples.

All drafts accepted in domestic transactionsmust therefore be secured at the time of accept-ance either by shipping documents or warehousereceipts or other such documents, as specified inthe law. If the aggregate amount of draftsaccepted for one person, firm, or corporation jexceeds a sum equal to 10 per cent of the capitaland surplus of the accepting bank, such drafts,whether in a foreign or domestic transaction,must remain secured throughout the life of thedraft since the Act provides that—

"No member bank shall accept, whether in aforeign or domestic transaction, for any oneperson, * * * to an amount equal at anytime in the aggregate to more than 10 percentum of its paid-up and unimpaired capitalstock and surplus, unless the bank is securedeither by attached documents or by someother actual security growing out of the sametransaction as the acceptance/7

To give this language any meaning it must beassumed that the accepting bank may, if itchooses, release the security in any case inwhich the total amount accepted for any onecustomer does not exceed 10 per cent of itscapital stock and surplus. Unless this inter-pretation is placed upon the statute, the pro-vision just quoted would be meaningless in sofar as it relates to domestic transactions, sinceall drafts accepted in domestic transactionsmust be secured at the time of acceptance.

In any case, however, where the total amountaccepted for any one customer exceeds 10 percent of the capital stock and surplus of theaccepting bank the security legally can not bereleased unless some other actual security grow-ing out of the same transaction as the accept-ance is substituted therefor. This immediatelyraises the question as to whether or not theordinary trust receipt substituted for shippingdocuments, warehouse receipts, etc., constitutes

an actual security such as is required by thisprovision of the Act. In an opinion filed bythis office on October 12, 1917, and printed onpage 881 of the November, 1917, BULLETIN, itwas stated—"that a trust receipt which permits the pur-chaser of the goods to obtain control of thosegoods either for milling or other purposes isnot an actual security within the meaning ofthe Act, and that, therefore, acceptancessecured by such trust receipts come within the10 per cent limitation imposed by section 13.

"A different situation results, of course, inany case where the trust receipt is of such acharacter as not to permit the purchaser togain control of the goods as where they areheld for the account of the acceptor by someperson, warehouse, or corporation independentof the borrower/7

The view expressed in this opinion has beenfollowed by the Federal Reserve Board invarious rulings relating not only to the pur-chaser in a transaction involving a sale, butalso to any customer for whom a draft isaccepted, regardless of whether or not there isan actual sale of the goods covered by thedocuments attached to the draft.

ELIGIBILITY YOU REDISCOUNT OF MEMBER BANK ACCEPT-

ANCES.

Under the terms of section 13 any draft orbill of exchange which a member bank has thepower to accept under the provisions of thatsection is technically eligible for rediscount by aFederal Reserve Bank. This does not mean,however, that Federal Reserve Banks are re-quired by law to rediscount every suchacceptance tendered to them for that purpose.In developing a general market for acceptancesthe Federal Reserve Banks are necessarily calledupon to carry a large amount of this class ofpaper, but it is important that the FederalReserve Board and the Federal Reserve Banksshould take all necessary steps to insure con-servatism in the exercise of the acceptancepower by member banks. The policy of theBoard, therefore, as reflected in its variousrulings, has been to caution Federal ReserveBanks that in rediscounting drafts accepted in



domestic transactions they should consider andin many cases investigate the circumstancesunder which the draft was accepted in order todetermine whether or not the particulartransaction complies with the spirit as well asthe letter of the statute.

It was in view of this policy that the FederalReserve Board has consistently refrained fromencouraging Federal Reserve Banks to redis-count or purchase warehouse acceptances afterthe warehouse receipts have been released,though there is nothing in the lay/ which pro-hibits the rediscount of such acceptances. Itis recognized, however, that an unrestrictedpolicy of rediscounting or purchasing such ac-ceptances after the warehouse receipts havebeen released might very probably lead to anabuse of the domestic acceptance privilege byfacilitating the use of the warehouse receipt asa mere cloak for a straight loan in violation ofthe provisions of section 5200. It can not bestated, of course, as a hard and fast rule that theacceptance of a draft secured by a warehousereceipt was not a bona fide transaction merelyand solely because the warehouse receipt hasbeen surrendered before the acceptance is pre-sented to the Federal Reserve Bank for redis-count. It should, however, put the bank onnotice and should suggest extreme caution inorder to determine whether in fact the accep-tance complies in every way with both the let-ter and spirit of the law. When Congressgranted the power to accept drafts in domestictransactions, it clearly intended to facilitatedomestic commerce and did not contemplatethat this power should be used for the purposeof extending unreasonable lines of credit toindividual borrowers in substantial violationof the limitations of section 5200 of the Re-vised Statutes. If Congress had intended togive greater latitude to banks under its juris-diction in the matter of loans of this charactera much more direct method would have been toremove or to broaden the limitations of section5200.

The Board has recognized the fact, however,that in the ordinary course of business, ship-

ping documents securing accepted drafts mustbe released in order that the customer for whom

• the draft was accepted may procure the goods| represented by such documents. It also rec-| ognizes the fact that where such drafts are se-cured by warehouse receipts it is probable thatat some period during the life of the draft itmay be necessary for the receipt to be surren-dered to the customer for whom the draft isaccepted in order that the transaction involvedmay be consummated. In the case of shippingdocuments it is ordinarily necessary to releasethe documents at an earlier period than in thecase of warehouse receipts.

In either case, as a matter of policy the se-curity should not be surrendered by the accept-ing bank until this becomes necessary in orderfor the transaction to be consummated and evenwhen surrendered, banking prudence requiresthat the bank protect itself by procuring eithera trust receipt or a definite agreement on thepart of the customer to whom the security issurrendered that the proceeds derived from thesale of the goods represented by the shippingdocuments or warehouse receipts will be depos-ited with the accepting bank when available topay the draft at maturity and will not be usedby the customer for other purposes. It shouldbe remembered, however, as previously stated,that in any case where a trust receipt is sub-stituted the 10 per cent limit applies if the trustreceipt is such as to give control over the goodsto the borrower or the customer for whom thedraft was accepted.

FEBRUARY 28, 1919.

TAXATION OF DIVIDENDS DECLARED TOINCREASE CAPITAL.

The following letter has been received fromthe Commissioner of Internal Revenue withreference to the taxation of dividends declaredout of surplus for the purpose of increasingthe capital stock of a bank:

FEBRUARY 28, 1919.

SIR: Keceipt is acknowledged of your letter of Feb-ruary 11, 1919, requesting information so that a proper


MABCH 1,1919. FEDERAL RESERVE BULLETIN. 257

reply may be given to the following telegram received byyou from one of the Federal Reserve Banks:

" Please advise if dividend from surplus to increase thecapital stock of a bank is subject to taxation."

It is not clear what this question means. If the bankdeclares a cash dividend in pursuance of a plan by whichall or part of the stockholders are to pay back to the bankthe amount so paid, in exchange for new stock, thesedividends are taxable to the extent tJiat any other cashdividends are taxable under the act. If, on the otherhand, a stock dividend is declared, it is subject to therules laid down in the act with, reference to stockdividends.

A distribution by a corporation out of earnings or profitsaccumulated prior to March 1, 1913, or out of any assetsexcept earnings or profits accumulated since February 28,1913, is not a dividend within the meaning of the statute.A distribution by a personal service corporation out ofearnings or profits accumulated since December 31, 1917,is not a dividend. A distribution out of earnings orprofits accumulated before March 1, 1913, is free from taxas a dividend; out of assets other than earnings or profitsaccumulated since February 28, 1913, may or may not befree from tax, according as each stockholder receives moreor less than he paid for his stock or its fair market value asof March 1, 1913, and, in the case of a personal servicecorporation, out of earnings or profits accumulated sinceDecember 31, 1917, is taxed to the stockholders as thoughthey were partners.

Dividends paid in securities OP other property (otherthan its own stock), in which the earnings of a corporationhave been invested, are income to the recipients to theamount of the fair market value of such property whenreceivable by the stockholders. A dividend paid in stockof another corporation is not a stock dividend. Where acorporation declares a dividend payable in stock of anothercorporation, setting aside the stock to be so distributedand notifying the stockholders of its action, the incomearising to the recipients of such stock is its fair marketvalue at the time the dividend becomes payable. Scrip

dividends are subject to tax in the year in which thewarrants are issued.

A dividend paid in stock of the corporation is income tothe amount of the earnings of profits distributed, as shownby the transfer of surplus to capital account on the books ofthe corporation, usually equal to the par value of the stockdistributed. But stock distributions made out of surplusother than earnings or profits accumulated since February28,1913, are not dividends within the meaning of the statuteand are free from tax as dividends. Stock dividends paidfrom earnings or profits accumulated after February 28y

1913, received by a fiduciary and retained as an accretionto the estate under the terms of the will or trust, are incometo the estate.

Any stock dividend received by a taxpayer betweenJanuary 1 and November 1,1918, or declared and creditedto a stockholder during such period and received by himbefore the expiration of 30 days after the passage of thestatute, is deemed to have been paid from the most re-cently accumulated earnings or profits and shall be taxedto the recipient at the rates prescribed for the years inwhich the corporation accumulated the earnings or profitsso distributed. Thus, such a stock dividend will bedeemed to have been paid from the earnings of 1918(unless paid during the first 60 days of 1918), and therecipient, if an individual, will be liable to any surtaxat the rates for the year 1918, unless at the time such divi-dend was paid or credited the current earnings up to thattime were not sufficient to cover the distribution, in whichcase the excess over the earnings of the taxable year willbe deemed to have been paid from the most recentlyaccumulated surplus of prior years and will be taxedat the rate or rates for the year or years in which earned.A corporation declaring and paying such a stock dividendout of earnings accumulated over a period of years shouldmake a record in its books of the amount of the dividendpaid out of each year's undistributed profits and advisethe stockholders accordingly.

Respectfully,(Signed) DANIEL C. ROPER,

Commissioner.



BANK TRANSACTIONS DURING JANUARY-FEBRUARY.

Debits to individual account reported byclearing-house banks in 151 leading centers forthe four weeks ending February 19 averagedabout 9 per cent less than for the preceding fiveweeks, reflecting somewhat the slackening intrade and industry and the hand-to-mouthbuying during the more recent period. Itshould be noted, however, that bank transac-tions about the close of 1918 and during most ofJanuary were unusually heavy, averaging over9 per cent in excess of like transactions duringthe four weeks immediately preceding.

Large declines in the figures for the secondweek in February are due to the fact that owingto the observance of Lincoln's birthday as aholiday by the banks in the leading centers,the reported figures for that week cover fivedays only.

Figures of debits to bank account on thewhole follow a parallel course, all the districts,just as in the case of debits to individual ac-count, showing smaller totals than for the im-mediately preceding period.

The following circular instructions have beensent to Federal Eeserve agents and to clearing-house managers:

FOR THE GUIDANCE OF FEDERAL RESERVE AGENTS.

In reporting weekly debits to bank account. FederalEeserve Banks should include debits to members' reserveaccount and nonmembers' clearing account only. Donot include any debits on account of transactions withother Federal Reserve banks. Debits to special depositarybanks shown on the books of the Fiscal Agent Departmentshould not be included with debits to either Governmentor bank account.

FOR THE GUIDANCE OF CLEARING-HOUSE MANAGERS.

1. Reports should be confined to the banks which aremembers of the local clearing house, or which clear throughclearing-house members (so-called clearing house non-member banks). In order that we may be able to followmore intelligently changes in the weekly figures, may werequest that your telegraphic reports state in addition tototal debits also number of banks covered by the report.

2. Debits to individual account should include all debitscharged to the accounts of individuals, firms, and corpora-tions, also of the United States Government, includingdebits to war-loan deposit account. Checks and otherdebits against savings accounts and payments from trustaccounts, also certificates of deposit paid should bereported among debits to individual account.

3. Debits to bank account should include all debits toaccount of banks and bankers, exclusive of (a) debits toaccount of Federal Reserve bank, (6) debits in settlementof clearing-house balances. It is important that the reportshow aggregate debits to individual account separatelyfrom aggregate debits to bank account.



Weekly figures of clearing-house bank debits to deposit accounts.

[In thousands of dollars, i. e., 000 omitted.]

District.Debits to individual account.

Jan. 29.

No. 1—Boston:Bangor 2,131Boston 229,283Fall River 6,220Hartford 16,227Holyoke 2,663 ,Lowell 5,336 INew Bedford 5,714 jNew Haven 18,946 :

Providence 29,166Springfield 12,508Waterburv 5,891Worcester' 12,843

No. 2—New York:Albany 20,858Binghamton 2,960Buffalo 53,456New York 3,736,138Passaic i 2,917Rochester 21,618Syracuse : 12,438

No. 3—Philadelphia:Altoona.....' 2,230Chester : 5,503Harrisburg : 4,905Johnstown 2,299Lancaster : 3,564Philadelphia , 268,552Reading : 3,428Scranton .= 12,589Trenton ! 7,774Wilkes-Barre i 4,444"VVilliamsport 2,981Wilmington ! 8,920York . . . . 2,611

No. 4—Cleveland: :

Akron , 16,045Cincinnati ! 52,211Cleveland 125,878Columbus 21,525Dayton 10,545Erie i 6,524Greenshurg, Pa 3,537Lexington, Kv ...! 9,716 'Oil City ." 1,756Pittsburgh ! 175,877Springfield , 3,157Toledo | 21,351Wheeling | 10,716Youngstown i 14,287

No. 5—Richmond: \ \Baltimore "• 72,921 !Charleston i 6,690 !Charlotte : 6,300Columbia = 5,824Norfolk i 19,449Raleigh ! 5,319 !Richmond 24,196 j

No. 6—Atlanta: IAtlanta 23,548 jAugusta 6,446Birmingham 9,685Chattanooga 7,591Jacksonville 10,583Knoxvillo 4,758Macon 4,944Mobile.. 6,413Montgomery 4,145Nashville 18,964New Orleans 69,239Pensacola 2,071Savannah 12,301Tampa 4,594Vicksburg 1,874

No. 7—Chicago:Bay City 2,848Bloomington 2,227Cedar Rapids 4,440Chicago 544,374Davenport 5,931Decatur, 111 2,884DesMoines 16,020Detroit 93,136 i

3,105 !272,0627,21819,4973,168 j5,278 '6,172 !17,011 !

27,94214,4016,98114,738

14,3533,23859,034

4,302,8423,55427,32418,588

2,4715,2284,8263,1624,222

306;1293,613

11,54510,0146,3662,802

10,6733,006

17,12357,547

125,75625,22011,1766,8632,765

10,5102,432

167,1722,372

21,40610,88812,835

81,3607,704 i5,600 ]6,488

17,494 |5,570

30,846

26,0246,687

14,29110,04010,9106,1805,3606.9774; 370

19,06171,9102,154

12,4164,3272,142

2,374 I2,3405,432

623,1778,454 i3,125 I

18,233 !

107,015 •

Feb. 5. ! Feb. 11-12.

I2,245

220,0366,166

13,7442,3044,2405,573

11,06725,73612,3054,606

11,900

17,9232,193

37,7252.901,788

3,20218,6149,956

1,8023,6844,3831,8222,721

222,4933,029

10,2867,7445,2612,4156; 6412,639

16,08649,168

103,92221,81210,8775,8582,7608,9511,984

154,4062,717

21,4496,481

12,550

69,1916,3765,1119,215 i

18,970 i3,565 I

25,080 ;

27,835 j5,682 !

13,451 I7,2089,944 I5,3354,5356,501 ;3,703 I

17,190 !62,285 j1,861 j

11 7374,3461,945

2,4401,8315,050

436,1546,2022,229

15,20568,400

Debits to banks' and bankers' account.

Feb. 19.

2,730226,3395,32518,1813,0094,7996,59116,54028,36512,6047,16413,488

14,9762,96862,840

3,881,9243,24126,58112,308

2 5284 9805,9372,9164,329

302,8134,64110,79812,7966,7292,8468,9263,090

16,95550,494119,99722,24010,1036,1982,30810,8722,741

154,7532,74922,4617,5619,695

74,9826,3785,5006,85718,4985,90022,177

23,0275,70711,0049,0129,9035,7694,4956,5275,83918,85565,1982,26611,7224,7071,604

3,0762,3883,495

614,0738,4212,91718,172130,534

Jan. 29.

279177,228

4221,234698398110,506

1,643522661

1,413

12,652

li,2361,584,480

203634506

711716855

354,048

1,55030273312

47652

42,335101,3022,85051264

6,3113,211

320,3701,9857,1828,5061,047

38,4393,2858,0003,40219,3693,28380,267

26,4442,0708,1054,60410,3221,9393,221961719

13,82238,807

9939,6321,775150

4441,0978,111

554,9591,870558

36,25342,380

Feb. 5.

306190,969

4432,012892522246589

1,451698563

1,600

12,166

9,i701,704,622

465746447

317156

318,047

i,970275154384

54

11247,416102,9253,280433215

11,7022,433

316,0252,4326,4367,267945

42,3053,3527,9002,44824,4573,20074,659

25,0872,0863,5303,9018,9221,6363,029683555

13,46937,279

8748,4891,501232

564895

9,211579,6272,460525

36,10441,346

Feb. 11-12.

367178,068

5621,193499280280679

1,462621419

1,266

8,386

6,6271,328,967

204612495

252

152193

263,982

1,4108069274

42

3639,43699,0503,11040159

7,4822,661

268,3861,6887,0916,4821,095

38,3302,9136,5763,00024,2702,48177,780

28,0341,9473,6213,6549,9671,5542,825840513

13,40537,090

9208,2901,783164

330756

5,664433,2521,704455

28,08130,784

Feb. 19.

271183,991

5871,659539240287629

1,757324653

1,310

8,647

10,6571,689,166

352559592

685

18171

346,270

1,810318109240

31

10842,591116,0283,40934847

7,8512,636

325,2362,1536,5507,657629

39,9152,9148,1002,64122,7382,90068,313

21,5081,9753,9704,4317,8261,9242,519972439

12,64942,5161,0437,5861,577

87

473893

9,685629,0742,239527

37,47848,832


260 FEDERAL RESERVE BUIiLETIN. MARCH 1,1919.

Weekly figures of clearing-house bank debits to deposit accounts—Continued.


District.

No. 7—Chicago—Continued.DubuqueFlintFort WayneGrand RapidsIndianapolisKalamazooLansingMilwaukeePeoriaRockford, 111Sioux City, IowaSouth BendSpringfield, HiWaterloo, Iowa

No. 8—St. Louis:E vansvilleLittle RockLouisvilleMemphisSt. Louis

No. 9—Minneapolis:AberdeenBillingsDuluthFargoGrand ForksGreat FallsHelenaMinneapolisSt. PaulSuperiorWinona

No. 10—-Kansas City:AtchisonBartlesville, OklaColorado SpringsDenverJoplinKansas City, KansKansas City, MoMuskogee, OklaOklahoma CityOmahaPuebloSt. JosephTopekaTulsaWichita

No. 11—Dallas:AlbuquerqueAustinBeaumont •DallasEl PasoFort WorthGalvestonHoustonSan AntonioShreveportTexarkanaTucsonWaco

No. 12—San Francisco:BoiseFresno...Long BeachLos AngelesOaklandOgdenPasadenaPortlandRenoSacramentoSalt Lake City.San DiegoSan FranciscoSeattleSpokane .-StocktonTacomaYakima

Debits to individual account.

Jan. 29.

1.800^2934'56916,60226,6932,6443,12549,41110,3624,03316,765

2,8512,854

4,2527,689

41,64328,703

129,907

1,1301,04'.)

29,534L7631,0622,9252,352

64,79234,833

1,300901

8101,7331,809

27,5152,7673,065

78,4562.60412;89559,4543,199

22.0593', 71818,7907,866

1,1913,5423,680

28,9015,91917,2S16,303

24,271a f, 6175,222

9971,6783,063

2,3655,1562,32254,51210,6143,6902,744

36,5711,508

11,36613,3434,654

128,85242,2497,2384,1399,4321.523

Feb. 5.

2,3005,1635,15414,77724,6703,2503,47659,62811,6374,82214,7473,8032,6623,263

2,6057,69540,92429; 220154,953

1,2571,7G3

25,5252,5371,1973,2492,01667,77638,1961,4221,217

9392,5S52.210

31.; 7853,2433,120

85,4283,13312,93964;5644,50521,2265,63117,421

1,6863,8414,582

29,7496,65919,1466,288

25,091o 6,1073,6941,6S11,9333,055

2,4725.8452', 65262.12513', 1333,2982,767

30,0181,695

15,33614,6335,7(58

171,17143.9498.804

3; .wo9; 21.41,908

Feb. 11-12.

1,7003,9003,91914,74222,6352,2392,90450,72810.0903', 59516,6092,3322,7922,391

2,2796,83941.95925,301124,323

9921,43115,5331,7321,1872,9812,11342,99329,1061,811978

1,0022,0661,69123,1443,1453,22182,6123,29111,04945,1063,21618,5163,80318,5529,750

1,3132,7033,76924,3405,64916,3365,66718,679a 5,4273,8281,259I,8fi72,485

2,0185,1702,08346,21711.7493,5702,09726,0221,3459,28811,6734,156

115,92227,3680,15253,1748.1071,570

Feb. 19.

2,0213,7254,67113,89032,6743,3384,30748,65412,5904,97915.2733'. 1672; 9182,925

3,3007,26350,13026,161128,110

1,2842,06614,0821,5411.1803; 1262,28162,12736,7931,830950

7812,3512,11126,1382,8883,24984,1193,07412,79163,4864,12116,7295,19518,2237,055

1,3314,4704,691

7,12117,3005,42127,918o7,4964,7891,8441,5793,823

1,8455,9132,78268,82011,1413,7133.44542;4182,21811,61014,6515,571

167,05342,1998,8544,940

10,34.2

Debits to banks' and bankers' account.

Jan. 29.

1,00019

1,5994,364

22,714407147

27,6221,949

8414,679

1,6401,109

1,2466,650

38,00724,254

126,470

9741,0093,6762,0891,1494,1642,936

73,68342,682

98824

59666

57422,144

6145,151

162,8462,132

11,62260,672

83818,4681,3707,190

11,528

3,4813,093

33461,5468,384

42,2683,991

43,064

4,327387

1,5692,180

4,7113,379

6535,7152,7285,261

31922,159

1,5044,374

22,172222

97,28820,9547,0562,4607.803'439

Feb. 5.

2,00089

1,6064,067

22,120439171

28,6592,310

13514.695l',8761,7981,260

1,5486,432

41,14721,974

120,015

1,061772

3,3862,4171,2503,9852,566

68,02744,020

135755

52654

76222,650

5255,343

166,8872,383

12,11162,355

82718,3861,8497,749

13,451

4,1433,187

58369,8438,668

41,1944,214

46,548

Feb. 11-12.

4,482477

1,5492,005

6,0943,450

12340,0142.8174,021

30022,679

1,6116,021

21,064383

110,79824,3047,4712,6166,685

342

1,250' 24

1,3353,097

17,81938485

26,8291,915

11716,1101,1901,6451,019

8125,871

40,21622,300

120,866

7521,0634,2711,7841,0054,2642,394

52,42132.617

124589

49666

56316,607

4445,122

103,9182,0409,529

50,175712

17,9431,4838,253

12,347

3,7572,637

48757,6887,028

36,1784,540

37,090

5,203418

1,5601,689

4,5282,598

10130,7882,7945,311

30015,7811,2504,253

16,262382

82,70216,4686,7201,7675,808

377

Feb. 19.

1,26723

1,5933,958

25,613462195

26,0822,323

21011,1312,1782,2861,227

1,7147,020

40,21624,401.

123,731

973-901

4,4181,1851,0883,9222,959

69,24741,605

117877

4442

90119,604

5084,877

158,6791,776

11,12357,627

94913,7511,7349,106

13,057

3,4354,022

44372,8689,243

41,8393,382

50,792

3,757476

1,3172,027

3,6133,255

8946,700'2,0195,506

30626,3211,8125,712

21,936407

111,26523,7707,8023,3717,554

499

a Figures comprise debits to individual as well as to banks' and bankers' account.



Recapitulation showing figures for clearing-house centers reporting for each of the four weeks.

[In thousands of dollars i. e., 000 omitted.]

included. T a R 29<

No. 1—BostonNo. 2—New YorkNo. 3—Philadelphia...No. 4—ClevelandNo. 5—RichmondNo. 6—AtlantaNo. 7—ChicagoNo. 8—St. LouisNo. 9—Minneapolis...No. 10—Kansas City..No. 11—Dallas... .; . . .•No. 12—San Francisco

Total

Debits to individual account. Debits to banks' and bankers' account.

346,7283,850,385

329'. 800473,125140, (599187,13(3817,862212.194142,241246,740108.670342; 278

7,197,808

Feb. 5. Feb. 11-12.: Feb. 19. ; Jan. 29.

397,5714,428,931374,057474,005155,0(52202,849925,099235,39714(3,155268,551113,512404.2S8

S,126,137

319,9222,991,401274.920419;021137,508 !183,558 !675,755 !200,701 I100,857 i230,1(54 I93,322 !288.754 I

345,1154,004,83(5373,3294.39,127338,202185,635935,041214', 964127,260252,311124,771409,523

185,1141,609,711356,641496,327156,045123,5(54723,005196,627133)284305,811174,624238,609

Feb. 5.

200,2911,727,616321,114501,621158,321111,273750,081191,116128,374315,858186,893260,793

5,915,883' 7,550,204 I 4,699,362 4,853,351

Feb. 11-12. Feb. 19.

185,6961,345,291266,229434,977155,330114,607572,655190.065101.284289,698158,275198;196

4,012,303

192,2471,709,973349,103515,243147,521111,022805,571197,082127,292293,778193,601271,937

4,914,370

WHOLESALE PRICES.

In continuation of figures shown in the Feb-ruary BULLETIN there are presented belowmonthly index numbers of wholesale prices forthe period July, 1918, to January, 1919, com- jpared with like figures for January of previous |years, also for July, 1914, the month immedi-ately preceding the outbreak of the great war.The general index number is that of theUnited States Bureau of Labor Statistics. Inaddition, there are presented separate numbersfor certain particular classes of commodities inaccordance with plans announced in previousissues of the BULLETIN.

Quotations for four commodities, namely,butter (prime first, San Francisco), cannedgoods (tomatoes, standard, New Jersey) andunderwear, merino (shirts and drawers, andunion suits) have been omitted. On the otherhand, quotations for Hour (buckwheat, NewYork) arillings (brown Pepperell), sheetings,brown (4-4 Pepperell), and bleached (10-4Pepperell), suitings (Middlesex, blue, 15 ounce),and tobacco, smoking (Bull Durham), whichhad been dropped temporarily have been se-cured for the months of December and January,and the commodities were again included in thecalculation of the index number for the lattermonth. In addition to the above changes, theusual annual revision of the list of commodi-ties has been made. The quotation for flourat Minneapolis is now for standard patents,instead of for standard war, as during theyear 1918. Pure rye flour is now quoted on abarrel basis. Freight has been added in thecase of structural steel and of barbed galvan-ized wire, while discounts are now used lor bariron (best refined), shingles (red cedar), ho-

siery (women's combed peeler cotton hose),oleomargarine, shirtings (bleached, Lonsdaleand Hough Rider), and women's dress goods(French serge). The source from which thequotations for Portland cement and for limeare drawn has been changed. Index numbersfor January are provisional, due to the factthat certain data were not received in time torender them available for use in the calcula-tions.

A considerable fall in prices between Decem-ber and January is indicated in the tablewhich follows. The general index number ofthe Bureau of- Labor Statistics has decreasedfrom 208 to 202. The decrease has beengeneral, as is shown by the fact that the indexnumber for each of the 3 groups of commoditieshas fallen. The decrease has been greatestin the case of the group of producers' goods,the index number for which shows a furtherdecrease from 199 to 194. Increases occurredonly in several cases among commodities in-cluded in the group. Among these may bementioned chrome calf leather, oleo oil/ andwood alcohol. On the other hand decreasesin price were considerable in many instances,and occurred for an extended list of commodi-ties. Among these were certain metal products,

; such as bar iron, steel billets am! plates,' copx>er wire, tin plate, zinc sheets and pipe,botn lead and cast iron, cotton and worstedyarns, wood pulp, jute and rope, tallow, certainchemicals, such as soda ash, caustic soda,glycerin, paint materials—in particular linseedoil and carbonate of lead—rosin, and rubber.

The index number for the group of rawmaterials has decreased from 198 to 195. Theindex numbers for all subgroups within thisgroup have likewise fallen. Tne decrease is



least pronounced in the case of the animalproducts subgroup, the index number forwhich shows a decrease from 208 to 207.Slight increases in the prices of cattle, poultry,and sheep, also goatskins, were almost offsetby decreases in the prices of packer hides andsilk, while decreases in the price of variousgrades of wool account for the entire decreasein the number for the group. The indexnumber for the farm products sub group hasfallen from 237 to 232. While wheat haseither remained constant or, in the case ofwinter wheat, increased in price, and the priceof hops has also risen, the increases are muchmore than offset by decreases in the prices ofcorn, cotton, oats, and tobacco, as well as to alesser extent by decreases in the prices offlax and hay. The index number for theforest products subgroup has decreased from150 to 147. The decrease is due to the fallin the prices of plain and quartered white oakand poplar, which was not offset by slightincreases in the prices of Douglas fir and maple.None of the commodities included in themineral products subgroup have risen inprice, and by far the larger number remain

unchanged. The further decrease in the indexnumber of the subgroup, from 182 to 177, isdue to decreases in the prices of coke, copperingots, pig iron, pig lead, and spelter.

The index number for the group of con-sumers7 goods has fallen from 216 to 212. Thisis the first decrease in the number which hasoccurred since March, 1918. Considerable di-versity is, however, exhibited by the fluctua-tions in the prices of the commodities includedin the group. Increases in price occurred inthe cases of certain meats, in particular beef(New York quotation), lamb and mutton, andpoultry, wrapping paper, whisky, peanuts,potatoes, apples, glucose, and cotton blankets,and slight increases in certain of the quotationsfor wheat flour. These increases, however,were much more than offset by decreases in theprices of certain cotton textiles, among whichshould be mentioned underwear, ginghams,print cloths, tickings, sheetings, shirtings anddrillings, certain meats, such as bacon andhams, lard, wheat flour (Kansas Cit}^ quota-tion), corn meal, coffee, beans, lemons andoranges, illuminating oil, and the usual consid-erable seasonal decreases in butter and eggs.

Index numbers ofwholesale prices in the United States for principal classes of commodities.

[Average price for 1913=100.]

Year and month.

July, 1914January, 1915January, 1916January, 1917January, 1918July, 1918August, 1918September, 1918.October, 1918November, 1918..December, 1918..January, 1919

Farmproducts.

102108116161240237246255240234237232

Raw materials.

Animalproducts.

10697

102136174209215219209208208207

Forestproducts.

97949599

130140143143143150150147

Mineralproducts.

8885

108175171180180180181183182177

Total rawmaterials.

9896

106147183196200204198197198195

Producers'goods.

9294

119166181196199203205205199194

Consumers'goods.

103103111147192202205209210214216212

All com-modities

(Bureau ofJLabor Sta-

tistics indexnumber).

9998

110150185198202207204206206202

In order to give a more concrete illustration j for certain commodities of a basic character,of actual price movements there are also pre- j The actual average monthly prices shown insented in the following table monthly actual | the table have been abstracted from the recordsand relative figures covering the same period j of the United States Bureau of Labor Statistics.



Average monthly wholesale prices of commodities.


Year and month.

Corn. No. 3,Chicago.

| Averagej rice per

July, 1914 ; SO. 7044January, 1915 • . 7056January, 1916 ; .7356January, 1917 '. .9753January, 1918 ; 1.6850July, 1918 1.5900August, 1918 1.6225September, 1918 1.5313October, 1918 1.3270N o v e m b e r , 1918 •• 1.2675December, 1918 ! 1.4290January, 1919 1.3750

Rela-tive

price.

114115120158274258264249216206232223

Year and month.

July, 1914January, 1915...January, 1916...January, 1917...January, 1918...July, 1918August, 1918September, 1918October, 1918...November, 1918.December, 1918.January, 1919...

Year and month.

July, 1914January, 1915...January, 1916...January, 1917...January, 1918...July, 1918August, 1918September, 1918October, 1918...November, 1918.December, 1918.January, 1919...

Hogs, light,Chicago.

pounds. I

$8.7563 j6.9875 !7.1400 i10.605016.212518.000019.775020.070018.093817.706317.440017.4125

1048384125192213234237214209206206

Coal, Poeahon-tas, Norfolk.

Averageprice perlong ton.

S3.00002.85003.00006.00004.41204.6320

[. 6320 iL 6320 I1.6320 !

Rela-tive

price.

10095100200147154154154154154154154

Cotton, middling,New Orleans.

Average Rela-price per tivepound, price.

SO. 1331 !.0783 j.1205 !.1735 ;.3105 i.2945 :.3038 !.3578 :.3150 !.3007 i.2958 !.2850 j

1056295

137244232239

237233223

Wool, Ohio, £ - |grades, scoured.

Aviprice perpound.

80.4444.5143.6429.81431.45451. 43651.43651.43651.43651.43651.43651.1200

Rela-tive

price.

94109136173309305305305305305305255

Coke, Connells-ville.

Averageprice pershort ton.

SI. 87501.62502.87507.25006.00006.00006.00006.00006.00006.00006.00005.7813

Rela-tive

price.

7767118297246246246246246246246237

Wheat, No. 1, ! Wheat, No. 2,northern spring, J red winter,

Minneapolis. I Chicago.

Averageprice perbushel.

SO. 89711.35271.28941.91662.17002.17002.22312.21692.21552.22062.22052. 2225

Rela-tive

price.

Averageprice perbushel.

103155148219248248255254 !254 |254 I254 |254

SO. 82101.39101. 28961.90242.17002.24702.23252.23632. 23452.23752.30882.3788

Rela-tive

price.

83141131193220228226227227227234241

Cattle, steers,good to choice,

Chicago.

Averageprice per

100pounds.

S9.21888.53338. 665010.530013.112517.625017.825018. 410017.856318.156318.360018.4125

108100102124154207210216210213216216

Hemlock,New York.

Yellow pine,flooring,

New York.

Coal, anthracite,stove, New York

tidewater.

Averageprice perM feet.

S24.500024.250022.250024.500030.500034.5000

36.0000

Rela-tive

price.

10110092101126142

Averageprice perM feet.

149

$42.000041.000039.500041.500057.000060.000063.000063.0000

I 63.0000I 63.0000

63.000063.0000

Copper, ingot,electrolytic,New York.

Averageprice perpound.

SO. 1340.1300.2288. 2950.2350.2550.2600.2600.2600.2600.2540. 2038

Rela-tive

price.

8583145188149162165165165165161130

Rela- I Averagetive | price per

price. I long ton.

928993128135141141141141141141

84.97265.17675.2639

6.50006.59686.59926.90006.90007.80717.95007.9500

Rela-tive

price.

102104112128130130136136140143143

Lead, pig,desilverized,New York.


SO. 0390.0380.0550.0750.0684.0802. 0805.0805. 0805. 0805. 0667.0558

Rela-tive

price.

86125170155182183183183183152127

Petroleum, crude,Pennsylvania!

at wells.

Averageprice per

barrel.

SI. 75001.45002.25002.85003.75004.00004.00004.00004.00004.00004.00004.0000

Rela-tive

price.

715992116153163163163163163163163

Hides, packers',heavy native

steers, Chicago.

Average i Rela-price per j tivepound. | price.

U938 !.2300 i.2300 j.3350 i.3280 !.3240 j.3000 !.3000 i.3000 !.2900 I.2900 !.2800 i

105125125182178176163163163158158152

Coal, bituminous,run of mine,Cincinnati.

Averageprice pershort ton.

$2.20002.20002.20004.50003.60004.10004.10004.10004.10004.10004.10004.1000

Rela-tive

price.

100100100205164186186186186186186186

Pig iron, basic.

Averageprice perlong ton.

S13.000012.500017.810030.000033.000032.000032.000032.000033.000033.000033.000030.0000

Rela-tive

price.

85121204224218218218224224224204



Average monthly loholesale prices of commodities—Continued.


Year and month.

Cotton yarns,northern cones,

10/1.


July. 1914January, 1915..January, 1916.January, 1917.,January, 1918..

SO. 2150.1650.2100.3400.5363

1918.July I .6412 !August ! .6400 !September ; .6100 ;October j .6100 !

November j .5927 |December ! .5500 jJanuary, 1919 ! .5000 •

i i

Rela-tive

price.

977595154242

2G0289276276

226

Beef carcass,good native

steers, Chicago.

Year and month.

! Average'• price per; pound.

July, 1914 ! 30.1350January, 1915 1 .1300January, 1916 i . 1375January, 1917 j .1375January, 1918 \ .1750

1918. |July .2400August \ .2420September | . 2450October ; .2450November j . 2450December I - 2450January, 1919 i . 2450

Rela-tive

price.

104100106106135

185187189189189189189

Leather, sole,hemlock No. 1.

Average i Rela-price pepound,

price per I tivepound. I price.

SO. 3050 i 108

.3250 i 115

.5700 203-

.4900 174

.4900

.4900

.4900

.4900

.4900

.4900 |

.4900 j

174174174174174174174

Coffee, Rio N o . 7.


. 0882

.0725

.0763

.0975

.0855

.0853

.0959

. 1040

. 1069

.1725

.1547

Rela-tive

price.

77

7777869396155139

Steel, billets,Bessemer,

Pittsburgh.

Steel, plates,tank, Pitts-

burgh.

Averageprice per

ton.

!

S19.000019.250032.000003.000047.5000

47.500047.500047.500047.500047.500045.100043.5000

Rela- I Average j Rela-ti ! i ! ti

Rela- I Average j Rela-tive ! price per! tiverice | pound price

e p p iprice. | pound, price.

74 !75 i124 I244184 !

S0.0113.0110.0208.0430.0325

Steel, rails, openhearth.

Pittsburgh.

Averageprice periong ton.

Rela-tive

price.

Worsted yarns,2-32rs, crossbred,

Average Rela-price per tivepound, i price.

II184 I

184 !184 ;184 |184 !175 i169 !

i

.0325

.0325

.0325

.0325

.0325

.0310

.0300

76 S30.000074 ! 30.0000

141 i 30.0000291 i 40.0000220 ! 46.8000 •

57.0000 I57.0000 i57.0000 i57.0000 I57.0000 I57.0000 i57.0000 •!

i

220220220220220

Flour, wheat,standard patents,

1914-1917, 1919,standard war, 1918,

Minneapolis.

Averageprice per

barrel.

$4.59386.85636.64389.210510.0850

10.702010.210010.210010.2100 !10.2100 |10.2100 j10.2750 i

Rela-tive

price.

100150145201220

233 j223 !223223 !223 •223 i224 ;

Hams, smoked,Chicago.

100 iloo !100 i133 !156 !

190190190190190190190

Illuminating oil,150° fire test,New York.

Rela- i Averagetive | price per

price. . gallon.

SO. 1769. 1538. 1588.1945.2950

.3025

.3225

. 3281

.3361

. 3541

.3670

.3494

1069396117177

182194197202213221210

97.1200 97.1300 I 105.1200 j 97.1600 ! 130

. 1710 ]

.1750 |

.1750 I

.1750 !

.1750 i

.1750 |

.1750 i

139142142142142142142

80.6500.6200

1.2500 I2.0000 I

2.1500 I2.15002.15002.15002.15002.00001.7500

8480115161257

277277277277277257225

Sugar, granu-lated,

New York.

Average j Rela-price per i tivepound. | price.

80.0420 j 98.0488 | 114.0573 j 134.0662 i 155.0744 ! 174

.0735 ;

.0735 i

.0845

.0882

.0882

.0882 i

172172198207207207207


MABCH 1, 1919. FEDERAL RESERVE BULLETIN. 265

DISCOUNT AND INTEREST RATES.

In the following tabl&s are presented actualdiscount and interest rates prevailing in thevarious cities in which the several Federal Re-serve Banks and their branches are located dur-ing the 30-day periods ending January 15 andFebruary 15, 1919. Quotations are given forprime commercial paper, both customers' andpurchased in the open market, interbank loans,bankers' acceptances, and paper secured byprime stock exchange or other current col-lateral. Separate rates are quoted for paperof longer or shorter maturities in the first namedand last named classes. In addition quota-tions are given for commodity paper secured bywarehouse receipts and for cattle loans, as re-ported from centers in which such paper iscurrent.

Quotations are also given of rates charged onordinary loans to customers secured by Libertybonds and certificates of indebtedness. Assist-ance to customers to enable them to purchasesuch Government obligations has generally beenextended at lower rates, either at the rate borneby such obligations or at a rate slightly higher.The table also shows quotations in New Yorkfor demand paper secured by prime bankers'acceptances, a type of paper which made itsappearance in the New York market severalmonths ago. Quotations for new types ofpaper will be added from time to time asdeemed of interest.

During the period under review, the decreasewhich had been remarked for the periods end-ing December 15 and January 15 on the wholehas continued, though to a lesser extent. Incertain cases, among which may be mentioned

the three large eastern centers, Chicago, St.Louis, and Salt Lake City, the decrease occursfor the majority of the types of paper for whichquotations are given. Rates in other cases,however, have remained firm, though no in-stances of pronounced increase in rates arenoted. There has been a tendency for cus-tomary rates charged on prime commercialpaper purchased in the open market to decline,though for other types of paper such rates ingeneral, with few exceptions, remain un-changed, the movement in rates in generalbeing confined to changes in the high and lowquotations. Rates charged on prime com-mercial paper purchased in the open marketexhibit the most marked decrease. In a num-ber of centers, among which may be mentionedRichmond, Jacksonville, Louisville, and SanFrancisco, lower rates for this type of paperare shown during the period ending February15 than during the period ending January 15,while rates for customer's paper remain prac-tically unchanged. For the latter type ofpaper, however, as also for time paper securedby prime stock exchange or other currentcollateral, a slight tendency to decrease inrates may be noted. On the other hand, ratesfor bankers' acceptances in general have beenfirm, and in Philadelphia and New York (inthe latter for indorsed acceptances only) haveshown a tendency toward a slight fractionalincrease, while in Chicago and Minneapolisthere has been a tendency toward decline.Rates on paper secured by Liberty bonds andcertificates of indebtedness, which on the wholeare lower than on ordinary commercial loans,or on loans secured by other collateral, remainpractically unchanged.


Discount and interest rates prevailing in various centers.DURING 30-DAY PERIOD ENDING JAN. 15.

fcO

District.

No. 1 . .No. 2 . .No. 3 . .No. 4 . .

No. 5 . . .

No. 6....

No. 7 . .

No. 8..

No. 9 . .No. 10.

No. 11.

No. 12.

City.

BostonNow York a..Philadelphia..ClevelandP i t t sbu rgh . . .CincinnatiRichmondBaltimoreAtlantaBirmingham..Jacksonville..New Orleans.ChicagoDetroitSt. LouisLouisvilleMemphisMinneapolis..Kansas City. .OmahaDenver

; Dallasi El Pasoj San Francisco; Portland' Seattle

SpokaneSalt Lake City

Prime commercial paper.

Customers.

30 to 90days.

"HTLT'C.61 5 66 5 51-66 51 66 5 66 6 66 5J 66 6 6

5-1 67 48 6

66

8 6 764 5 | 66 51 5£-66 5 66 5£ 66 5} 66 5 66 5% 66 5 66 54 68 0 68 6 6

4 to 6months.

77. L. a54 65 5f6 5 52-6

6 56 66 6

6 5 5-i-6

Open market.

30 to 90 I 4 to 6days, j months.

77. L. C. II. L. C.61 5 54 i 61 54 526 5 51-6! 6 44 54-6

5 45 6 i 6

2 I6 5 526

5 654 654 65 6 . . .52 G j 545 6 1654 6 646 6 6

5 5L54 6 651 6 6 5152 5? 52 5£6 6 6 65 6 ! 8 56 64 ! 64 6 646 6 I5 54 6 5 54

6

5 5J 6 54 5454 6 6 6 65 6 64 51 651 54 ! 6 51 54

Interbankloans.

II. L. C.54 5 546 42 5-546 5 5454 5 56" .54 66 5 546 54 654 54 546 54 68 6 66 6 66 5

Bankers' acceptances,60 to 90 days.

Indorsed. Unindorscd.

ii. L. a

41 4ft 44ft 4ft 4-142 4! 4X

0 6 66 6 6

77. L. 0.4ft 41 4ft6 4 41-64 | 4ft 4 |

4ft 4ft 4%5 4§ 42

6 54 54-6 44 4ft 446 54 6 |6 5 6 j 6 41 65 5 5 | '6 5 6 | 5 5 5

6 5 6 I..!...!...!.64 54 67 6 6

G 6 06 6 67 6 646 6 6"4ft 4ft 4ft

? 8 ?

6 716 6 6

5-6-6 4 44-56 6 •' 4$ 4J 416 6 i 44 4£ 44

G 6 6 i7 6 7

5 5 55 41 4*6 6 6

5 41 4g4§ 4^ 4142 4g 425 5 5

Collateral loans—stock exchange orother current.

Demand. 3 months.

V

546666655655456

?655G6J

?666

a6

52-666666

3 to 6months.II. L. C.

6 6

6 6

8 7

65666

?666

f565

?6

?G56667

5=1-66666652

Cattleloans.

77. L. C.

8 6 610 6 8

'•10 8 8

Secured bywarehousereceipts,

etc.

77. L. C.

6 G

6 6 68 6 68 6 76 6 6

54 5.1- 54

Secured byLiberty

bonds andcertificatesof indebt-

edness.

77. L. C.5 414-16 4-1 4.1-56 41426 416 41 65,41416 414154 41 56 41 68 41 41-6G 6 66 4i 55 41 416 41 66 41 546 4166 41 554 5 56 41 67 5 5J-66 41 66 6" 68 7 86 41G 41 G

DURING 30-DAY PERIOD ENDING F E B . 15,1919.

No. 1. .No. 2 . .No. 3 . .No. 4 . .

No. 5 . . .

No. 6 . .

No. 7..,

No. 8. .

No. 9 . .No. 10.

No. 11.

No. 12.

BostonNew York &..Philadelphia..ClevelandPi t t sburgh . . .CincinnatiRichmondBaltimoreAtlanta ! 7Birmingham..Jacksonville..New Orleans.ChicagoDetroitSt. LouisLouisvilleMemphisMinneapolis..Kansas Ci ty . .OmahaDenverDallasEl PasoSan FranciscoPortlandSeattleSpokaneSalt Lake

5 51 j5 51-54i5 6 "\5 G r5 51 i54 65 5:152 52

5 2 651 Bh5 545 51

6 5 oh-6 5 5l6 5 546 5 66 5 516 6 G51 5 5*

5 | 52

52 6

52

6 5

G 554 5

O 0.45 546 65 516 G I51 5} j

02 1

6 G 6'54 51 5j6 G 66 51 5j6 5 "

454

854

650

5

65-5*

5;i6

86664

G 65 51-54

5 5.V5 G

54 5 5 54 5 5

H 4ft 4ft 4ft-1! 4ft

4§ 41 4ft41 44

0 54 65 5" 5

6 iG i 7 661 ! 6 54- 4ft 4ft

6 4] G41 4ft 41

6 6 66 6 6

6 4j 641 4ft 4-1

41

6

6

54

¥

4ft 4ft

6

6

6

65

6

6

41-54

5*

44

6

G

5

41

6

G

455

41

6

6

t5

54 52 65 5i I 65 54-5 6

I*668.7646666667886868

5 66 66 66 65 526 66 G6 75 65 5^51- 65" 545 66 654 65 6

54 6-751 66 66 85 65 64

8 G

5J 5,5 51-654 65 66 6G 0G (55^ 526 66 (>6 754 65 i)\6 G"5 G5 G6 654 65 054 6-751 66" 66 85 65 G46 6

6 6-76 G6 88 8

6 6 0

6 6 G8 6 67 7 764 o\ 6

6 51

5 4i 416 4 41-120 41 4-16 416 4\ 65 41- 416 4i 552 41 5G 41 68 416 6 66 4-1 56 41 56 41 66 4 1 5 |6 4156 4i 554 5 56 41 67 5 66 4* 68 6

741 414i 61

8 41 67 6 G

a Rates for demand paper secured by prime bankers' acceptances, high 6, low 4i, customary 41-5. 6 Rates for demand paper secured by prime bankers' acceptances, high 54, low 4], customary 4 A-4I-



PHYSICAL VOLUME OF TRADE. j January issue contains a description of thei methods employed in the compilation of the

In continuation of tables in the February \ data and the construction of the accompany-FEDEEAL RESERVE BULLETIN there are pre- i ing index numbers. Additional material willsented in the following tables certain data! be presented from time to time as reliablerelative to the physical volume of trade. The ! figures are obtained.

Livestock movements.

[Bureau of Markets.]

Receipts. Shipments.

Cattle andcalves, 60markets.

1GI8. i Head.January , 1,694,490

JulT : 2,110,835August i 2,009,744September : 2,799,913October : 2,832,022November i 2,f>25,381December I 2,132,491

1919. |January j 2, 111, 704

Hogs, 60markets.

Sheep, 60markets.

Head.4,341,474

3,113,2812,476,1902,386,4753,421,6414,605,1585,569,356 !

Head.1,287,695

1,585,7352,129,3253,303,855 !3.234,026 i2,535,115 i1,640,365

PTorses and:mules, 44 \markets. ;

Total, allkinds.

Cattle andcalves, 54markets.

Hogs, 54markets.

Head. \ Head. Head. I Head.157,504 7,481,163 j 555,520 ! 1,260,724

51,393 6,861,24480,122 | 6,695,381

124,201 : 8,61-1,544146,072 ! 9,633,761135,344 • 9,900,99872,471 ; 9,414,683

5,861,685 1,567,613 j 110,411 9,651,413

665,800 i850,363 !

1,219,333 •1,300,084 '\1,232,771 !

785,770 :

349,301849,618786,917896,258

1,216,8601,429,251

Sheep, 54markets.

Head.524,457

734,5391,198,6912,059,9902,069,0571,446,523

716,100 j

Horses andmules, 44markets.

761,168 1,546,875 '. 608,016

Head.151,468

45,54976,653114,023140,845131,30871,243

106,459

Total, allkinds.

Head.2,492,169

2,395,1892,975,3254,180,2634,406,2444,027,4623,002,364

3,022,518

Receipts and shipments of live stock at IS western markets.

(Chicago. Kansas City, Oklahoma City, Omaha, St. Louis, St. Joseph, St. Paul, Sioux City, Cincinnati, Cleveland, Denver, Fort Worth, Indianapolis,

Louisville, Wichita.]

[Monthly average, 1911-1913=100.]

RECEIPTS.

1918.January

JulyAugustSeptemberOctoberNovemberDecember

1919.January

Cattle and calves.

Head. | Relative. Head. Relative, i Head. Relative.

1,317,368

1,697,1931,588,5532,249,0172,267,5342,053,3591,706,945

131

168158223225204169

1,656,046 i

3,333,591

2,530,4141,970,0861,775,8422,570,5253,431,7824,197,313

161 j 4,603,335

152 '. 946,495

115 |9081

117156191

1,141,4881,424,6772,408,6092,357,5241.677,5371,114.761

209 i 1,079,377

8410417617312382

79

Horses and mules.

Head. I Relative.

87,444 | 190

36,78254,27182,65683,57464,48236,153

56,631

11818018214079

123

Total, all kinds.

Head. • Relative.

5,684,898

5,405,8775,037,5876,516,124 I7,279,1577,227,1607,055,172

7,395,419

123

117109141158156156

160

SHIPMENTS.

1918

JulyAugustSeptember

NovemberDecember

1919.January . . . . -

401,864

495,211652,440932,131994,943921,831588,425

589,362

99

122160229245227145

145

755,282

662,728599,577488,298486,460659.432787,461

988,035

156

137124101100136163

204

316,304

483,151751,886

1,426,1201,479,774

903,283445,987

357,386

63

9614926529417989

71

85,528

31,37951,92374,47384,39363,58937,072

56,282

208

7612718220615590

138

1,558,978

1,672,4692,055,8272,921,0223,045,5702,548,1351,858,945

1,991,065

109

116143197212177129

139



Grain and flour.

[U. S. Food Administration.]

GRAIN MOVEMENT.

[In thousands of bushels; i. e., 000 omitted.]

JuneJulyAugustSeptember.OctoberNovember..December..

1918.

'Wheat.

Receipts, j Shipments.

January.1919.

1918.

January.1919.

196,0(50287,652286,200241,260155,665178,916

129,998

94,823160,162150,636150,077138,438127,612

80,495

Stocks atclose ofmonth.

12,41581,422

163,027246,690286,169254,474253,767

245,683

Corn.

Receipts.

59,46648,13162,13759,43747,02459,237

98,648

Shipments.

54,79242,99946,45347.50141,88650,312

79,935


37,79431,91925,55928,52225,72721,64623,427

30,448

Oats.

90,006177,324126,138110,62086,87180,199

102,887

i Stocks atShipments.! close of

month

87,893124,597102,510107,69395,00881,220

89,613

39,09737,92386,030104,739103,94388,30083,363

85,811

Barley. Rye.

Receipts. Shipments.

14,28521,34027,002

22,697 i23,255]

7,0779,92315,29519,84321,15322,287

27,687 j 27,130


10,606 |16,984 !27,174 |37,782 I40,670 i39,991 i40,320

Receipts.

3,4748,42216,09220,66717,52115,721

40,073 I 16,686

2,0244,4497,409

15,047 j13,5528,721

10,201


2,1812,9126,12812,85417,30919,19925,779

30,031

Total grains.

Receipts.; Stocks at

Shipments.; close of: month.

363,291542,869517.569455; 873329,778357,328

375,906

342,130322,303340,161310,037290,152

287,374

171,160307,918430,587473,818423,610426,656

432,046-

WHEAT FLOUR PRODUCTION.

[In thousands of barrels; i. e.. 000 omitted.)

JuneJulyAugust. . .September

1918.

Production.

6,78010,39111,335

Stocks atmills at close

of month.

1,1091,6062,3863,064

!

1918.OctoberNovemberDecember .Janua>rv, 1919

i

j Production.

ii

! 11,752i 11,175=: 11 759

12.994i

Stocks atmills at close

of month.

3,4223,3873,2603,341

JanuaryJulyAugust..SeptemberOctoberNovemberDecember

January

1918.

1919.

California shipments of citrus

Oranges,

Carloads.

1,409914767549485

1,1253,565

3,130

and deciduous fruits.

Relative.

583731222046

146

128

Lemons.

Carloads.

237561732275639676722

531

Relative.

5913918168

158167178

131

Total citrus fruits.

Carloads.

1,6461,4751,499

8241,1241,8014,287

3,651

Relative.

585253293963

150

128

Totaldeciduous

fruits.

Carloads.

3,7589,1265,8797,143ls044

267

109


M A R C H 1 ,1919. FEDERAL RESERVE BULLETIN, 269

Sugar.[Data of International Sugar Committee for ports of Boston, New York, Philadelphia, Savannah, New Orleans, Galveston, San Francisco.l

[Tons of 2,240 pounds.]

Receipts,

1918.JulyAugustSeptemberOctoberNovember

288,449218,690176,887242,912

Meltings.

320,908263,383210.745207; 566

Raw stocksat close of

month.

135,061100,39256,97877,233

December...1918.

January.,1919.

Receipts. Meltings.

138,14192,785

243,806

172,528123,091

197,145

Raw stocksat close of

month.

50,98913,774

66,189

1918.January

JulyAugustSeptember.October

Receipts.

Tons. Rela-tive.

123,080

186,225 \159,252 !145,555

67

1018779

[Data for ports of New York, Boston, Philadelphia.]

[Weekly Statistical Sugar Trade Journal.]

[Tons of 2,240 pounds. Monthly average 1911-1913=100.]

Meltings.

Tons.

90,000

221,000175,000139,000

Rela-tive.

1209576

Raw stocks atclose of month.

Tons.

39,494

Rela-tive.

23

55,322 3239,375 2348,869 27

1918NovemberDecember.

1919.January . . .

Receipts.

Tons. Rela-tive.

151,703 I 82 156.000139,343 i 76 139!00058,751 | 32 92,000

!

172,054 ! 93 | 147,000

Meltings.

Tons. Rela-tive.

Raw stocks atclose of month.

Tons.

42,52243,11211,170

36,544 I

Rela-tive.

25257

21

1918.January


1919January

Southern pine.

No.of

mills.

188

201202196202194204

200

Produc-tion.

381,705

412,002391,648346,069321,214312,126310,068

330,137

Ship-ments.

393,997

453,786437,776350,628353,266353,810322,831

325,241

Lumber.[From reports of manufacturers' associations.]

[M feet.]

Western pine. Douglas fir.

No.of

mills.

24,46

42,4544,47

4542,4738,4627,46

21.49

Produc-tion.

64,999

147,533151,156130,029121,85090,07863,315

40,, 354

Ship-m e n t s -

ofmills,

93,386

112,915109,40280,859

127

123130108

79,701 j 11574,103 12163,823 121

68,910 I

Produc-1 Ship-tion. j ments.

336,200

269,100292,200316,000356,487259,396211,664

304,600

266,300275,000248,000324,080239,493209,999

Eastern white pine.

No.oi

miUs.

26

262626

27,211611

13

Produc-tion.

34,762

86,65895,94272,93732,78723,529

799

7,565

Ship-ments.

38,666

59,41251,32738,71126,15223,82814,176

15,172

North Carolina pine.

No.of

mills.Produc-

tion.

14,341

31,51724,11831,90827,91232,59626,728

!40 I 28,629

Ship-ments.

11.913

34,81534,37734,96336,47836,01221,570

23,869

RECEIPTS AND SHIPMENTS OF LUMBER AT CHICAGO.

[Chicago Board of Trade.]

[Monthly average 1911-1913=100.]

Receipts.

j M feet.

1918. |January | 122,976

July I 243,598August ! 208,963September | 171,515October j

Rela-tive.

Shipments.

Mfeet.

58

1159981

58,362

98,14578,70768,133

Rela-tive.

76

128103

Recepits. Shipments.

1918.NovemberDecember

1919.January

M feet.

130,503142,230163,908

134,604

Rela-tive.

626777

63

M feet.

70,59072,72360,831

47,922

Rela-tive.

929579

62


270 FEDEEAL RESERVE BULLETIN. M A R C H 1,1919.

Coal and coike.

[Bituminous coal and coke, U. S. Geological Survey; anthracite coal, Anthracite Bureau of Information,]


|j Bituminous coal, esti-j mated monthly pro-I duction.

January.1918.

42,607,206

July i 55,587,312August ! 55,732,092September i 51,757,334October I 52,885,813November 44,386,987December 40,634,525

Short tons. Relative.

1919.January 41,484,000

115

150150140143120110

112

Anthracite coal, ship-1ments over 9 roads.

Coke, estimated monthly production.

Long tons. Relative.

5,638,383

7,084,7757,180,9236,234,3956,286,3665,276,6595,736,260

5,934,241

100

12612811111294102

105

Beehive.

Short tons, Relative.

2,242,362

2,813,9102,657,0722,570,2382,611,8852,339,1972,255,296

2,401,567

108102

100

92

By-product.


1,649,819

2,300,6732,387,6752,410,7982,563,1832,523,7462,562,048

2,441,433

187

261271274291287291

277

Total.


3,892,181

5,114,5835,044,7474,981,0365,175,0684,862,9434,817,344

4,843,000

114

146144143148139138

139

Movement of crude petroleum {east of Rocky Mountains).[U. S. Geological Survey.]

[Barrels of 42 gallons each.]

Marketed.

Barrels. Relative.

Stocks atend ofmonth.

Barrels.

Marketed.

Barrels. Relative.

Stocks atend ofmonth.

Barrels.

1918.January

JulyAugustSeptemberOctober

18,800,500

21,617,46420,496,99120,384,523

160

184174173

118,836,090

110,950,501108,768,635104,746,889


1919.January

21,495,28320,783,89919,637,286

21,527,000

183177167

183

102,669,51899,419,23796,318,452

97,258,000

Total output of oil refineries in United States.[Bureau of Mines.]

J a n u a r y —February. .MarchAprilMayJuneJulyAugustSeptember.OctoberNovember.December..

1918.

Crude oil run(barrels).

Stocks at the close of month.Jan. 31 . .Feb. 28..Mar. 31..Apr. 30..May 31..June 30..July 31..Aug. 31..Sept. 30.Oct. 31. .Nov. 30..Dec. 31 . .

23,842,58723,386,67626,239,66228,201,54428,510,69828,140,47929,170,71828,534,27528,390,43129,237,76727,411,63626,958,157

12,324,19111,633,41113,122,24112,600,06211,824,63311,956,15114,026,52513,946,59514,462,10015,438.57615,222;40115,749,771

Gasoline(gallons).

Kerosene(gallons).

I242,632,044234,324,619269,627,968293,396,162319,391,202315,023,445332,022,095330,335,046314,595,959314,251,318312,388,640291.744,465

469,277,166518,794,609.526,382,386509,197,134460,637,479418,440,353349,928,604285,446,538269,772,723250,328,369270,072,011297,326,983

119,358.184121,218,320151,228,007153,703,682160,590,760151,840,252156,828,826149,678,850164,963,798164,928,640169,278,105161,742,713

436,254,045411,150,157356,530,540393,527,476343,311,945426,285,676432,807,129424,281,481436,628,907419,409,944397,804,012380,117,829

Gas and fuel(gallons).

547,866,24S510,165,397587,985,804578,255,341631,586,209628,842,033658,439,682671,113,871653,085/050661,780,441604,403,494587,873,987

547,450,775502,046,087483,447,727471,644,479515,020,224550,704,759519.012,839569,016,413583,407,769596,116,351583,777,918659,001,357

Lubricating(gallons).

56,623.42558,300; 91469,308,35171,022,20479,589,73574,420,99679,303,10772,892,87970,593,07972,244,63372,178,60264,087,842

141,907,918150,259,653146,572,398144,383,212161,009,729158,316,257136,460,207137,496,986147,425,556135,196,542132,923,478138,853)574



Iron and steel.[Pig iron production, Iron Age; steel ingot production, American Iron and Steel Institute.]

[Monthly average, 1911-1913=100; iron ore, monthly average, May-Nov., 1911-1913=100.]

January.

JulyAugust.

1918.

3,420,988 [3,389,585 i

September 3,418,270 iOctober 3,486,941 |November j 3,354,074 |December : 3,433,617 j

Pig iron production.

Gross tons. Relative.

2,411,768

January... .February.

1919.

!

302,260 !940,168 i

104

148146148151145148

143136

Steel ingot production.


2,203,845

3,113,635 j3,083,680 I3,197,658 i3,352,1963,060,1542,992,291

3,082,4272,688,011

Unfilled orders U. S.Steel Corporation atclose of month.


92

130129134140128125

129 |120 '..

9,477,853

8,883,8018,759,0428,297,9058,353,2938,124,6637,379,152

6,684,263

180

169166157158154140

127

Non/errous metals.[Tin, Department of Commerce; spelter, United States Geological Survey.]


1918.January


Imports of pig tin.

Pounds.

12,672,727

15,567,66716,317,43710,630,6669,885,984

Relative.

138

171180117109

Spelter.

Production.

Shorttons.

46,223

46,46745,81143,49245,631

Relative.

171

172170161169


58,354

42,48043,47741,31830,608


1919.January, 1919....

Imports of pig tin.

Pounds.

10,734,1795,887,063

8,461,444

Relative.

11868

93

Spelter.

Production.

Shorttons.

43,55546,903

49,215

Relative.

161174

182


31,87434,765

46,073

NOTE.—Figures of spelter production for January partly estimated.

Textiles.[Silk, Department of Commerce; cotton, Bureau of the Census; wool, Bureau of Markets; idle machinery, Jan.-Sept., 1918, inclusive, National Asso-

ciation of Wool Manufacturers.]

[Cotton, monthly average crop years 1912-1914=100; silk, monthly average 1911-1913=100.]

1918.January


1919.JanuaryFebruary

Cotton consump-tion.

Bales.

523,917

541,792534,914490,779.440,833457,376472,941

556,721

Relative.

117

12011910998102105

Cottonspindlesactiveduringmonth.

Wool con-sumption(pounds).

Percentage of idle woolen machinery on first of monthto total reported.

Looms.

Wider Underthan SO- | 50-inchinch reed j reed

space. I space.

|

33,552,732 ! 53,827,887

33,674.896 | 50,951.65133,646,811 | 51,516,45733,524,275 | 47,648.41332,760,623 ! 48,692150933,121,507 ! 38,282,72333,652,612 i 32,355,081

124 33,856,472 j 32,573,970

9.6

10.412.213.818.321.1 i22.5 i

12.1

10.214.315.124.326.824. 9

40.3 |52.3 !

Sets ofcards.

6.1

5.96.07.89.3

11.113.8

32. 6 32. 241.5 | 38.7

Spinning spindles.

Combs.!

8.1

10.5 j10.213.212.523.817.8

30.7 |39.8 j

Woolen.

6.2

36.541.1

Worsted.

14.7

6.56.68.38.8

11.916.1

13.215.320.218.830.127.4

Imports of raw silk.

Pounds. Relative.

37. 5 i48.6 |

2,470,187 |

1,997,314 !3,813,5953,973,7542,814,2702,336,3452,680,863

1,461,837 I

121

186194138114131

71

NOTE.—Figures of idle wool machinery for Nov. 1 and Dec. 1 are not entirely comparable with previous figures, due to fact that later figures arefor number of machines running on single shift, while earlier iigures count as two a machine running double time. The effect is, however, small.



Production of wood pulp and paper.

[Federal Trade Commission.]

[Net tons.)

1918.JulyAugustSeptember..OctoberNovember..

Woodpulp.

Newsprint.

262,377246,741237,624270,849 i 97; 693

103,348113,82699,52888,155

Book.

69,45876,43966,58160,74367,262

Paperboard.

177,931192,810168,384143,373152,321

Wrap-ping.

70,52671,24961,39056,90361,681

Fine.

34,60936,91037,83328,53333,429

1918.December..

1919.January

Woodpulp.

273,973

283,270

Newsprint.

107,129

116,289

Book.

64,501

73,809

Paperboard.

134,103

142,764

Wrap-ping.

51,947

52,226

Fine.

29,975

29,407

Tax-paid manufactured tobacco products in the United States (excluding Porto Rico and Philippine Islands).

[Commissioner 01 Internal Revenue.]

1918January


Cigars.

Large.

Number.532,833,941

634,609,533624,491,239585,400,449594,764,527

Small.

Number.69,439,836

79,237,84960,880,91060,556,00063,111,160

Cigarettes.

Small.

Number2,447,265,488

3,796,878,8223,442,446,2343,403,205,7363,027,300,975

Chewingand smok-

ing tobacco.

Pounds.30,109,316

36,607,57840,764,85337,893,81839,440,893


1919.January

Cigars.

Large.

Number.537,794,904527,586,098

518,706,482

Small.

Number.63,177,20059,139,250

72,458,974

Cigarettes.

Small.

Number.2,986,775,6432,788,379,210

3,079,212,253

Chewingand smofc-

iag tobacco.

Pounds.32,618,00925,276,695

29,308,616

Output of locomotives and cars.

[Locomotives, United States Railroad Administration; cars, Railway Car Manufacturers' Association.]

1918.January.

JulyAugustSeptember.October

Domesticshipped.

Locomotives.

Foreigncom-

pleted.

Output of cars.

Domes-tic.

Number. Number. Number.4,281

3,3122,4.372,6604,555

214 !267 I295 !

77|213 !313 I

Foreign.

Number.2,183

4,4104,8473,5642,681

Total.

Number.6,464

7,7227,2846,2307,236

Domesticshipped.

1918.November.December..

1919.January

Locomotives.

Number.224281

282

Foreigncom-

pleted.

Number.252177

84

Output of cars.

Domes-tic.

Number.6,7437,876

8,172

Foreign.

Number.2,3303,402

3,635

Total.

Number.9,093

11,278

11,807

Vessels built in United States, including those for foreign nations, and officially numbered by the Bureau of Navigation.


1918.January


Number.

57

193177170202

Grosstonnage.

64,795

229,931295,849308,470357,532

Relative.

268

9511,2241,2761,479


1919.JanuaryFebruary

Number.

171153

132135

Grosstonnage.

357,660283,359

264,346271,430

Relative.

1,4801,173

1,0941,203



1918.January

Tonnage of vessels cleared in the foreign trade.4 [Department of Commerce.]



Net tonnage.

American. Foreign.

801,351

2,093,3102,332,5772,009,1941,875,947

1,739,823

2,941,1712,808,4662,290,8722183383

. Per-!centagei ofAmeri-

total.

2,631,274

5,034,4815,141,0434,300,05640393302,163,383 ! 4,039,330

68

129132111104

33.9

41.645.446.746.4

Rela-ljtive. jj

Net tonnage.

"l American.j Foreign.

134

164179185184

1918.November ! 1,770,December

1919.January

1,141,3191,991,7252,053,517

1,166,391 j 1,898,123

Total.

3,762,0603,194,836

3,062,514

Rela-tive.

78

Per-centage

of "Ameri-can tototal.

47.035.7

38.1

tive.

186141

151

January.

July.August.

1918.

Net ton-miles, revenue and nonrevenue.

[United States Railroad Admluistratio n.]

ii October27,619,867,000 i! November.

II December..38,761,291,000 ]"38,469,847,000

September j 38,592". 137,000!

! January .1919.

39,548,532,00035,533,026,00033,659,507,000

30,383,169,000



GOLD SETTLEMENT FUND.

Clearing and transfer operations through thegold settlement fund for the 13 weeks endingFebruary 20, 1919, totaled $15,305,209,000,averaging SI J77,324,000 per week, as againstan average of $1,139,593,000 per week forthe immediately preceding 9 weeks. TheNew York bank reports a loss through settle-ment of 51,473,882,000 and a gain throughtransfers of $1,409,847,000. As the result ofthese operations the bank shows a decrease of$64,035,000 of gold, which was, however, morethan fully made up by deposits and transfersof gold from the Federal Reserve agent's fund,the bank's balance in the gold fund at theclose of the period showing a net gain of$15,965,000. Chicago reports a gain throughsettlements and transfers of $38,800,000, whileother important gains are shown for the At-lanta, St. Louis, and Kansas City banks.

Government loan operations, including theplacing of six issues of Treasury certificatestotaling about 3,800 millions and the transferof the larger portion of the funds raised toNew York City, account largely for the un-usually large volume of the transactions.

Net deposits of gold in the banks' fundaggregated $126,838,000, of which $111,198,000was transferred to the agents' fund, resultingin a net increase in the banks' fund of$15,640,000. During the same period theagents' fund shows a gain of $19,902,000.On February 20 the total amount standing tothe credit of the Federal 'Reserve Banks andagents was $1,347,459,000, as against$1,311,917,000 on November 21, 1918.

Below are given figures showing opera-tions of these funds for the period Novem-ber 22, 1918, to February 20, 1919, both in-clusive :

Amounts of clearings and transfers through the gold-settlement fund, by Federal Reserve Banks, from Nov. 22, 1918, to Feb.

20, 1919, both inclusive.


Settlement of—Nov. 22-29Nov. 30-Bcc. 5..Dec. 6-12Dec. 13-19Dec. 20--26Dec. 27-Jan. 2 . .Jan. 3-9Jan. 10-18Jan. 17-23Jan. 24-30

Totalclearings.

1,160,334930,853

1,044,1591,082,467944,679

1,014,8231,155,6771,020,7251,139,1841,009,724

Transfers.

144,741127,103287,468165,1S864,651

218,876192,84465,942

192,81080,909

Settlement of—Jan. 31-Feb. 6.Feb. 7-13Feb. 14-20

Total.

Total for 1919 to date.Total for 1918Total for 1917

Totalclearing3.

1,010,963788,963

1,117,683

13,420,234

7,426,62345,439,48724,319,200

Transfers.

179,52161,162

103,760

1,884,975

913,5854,812.1052,835,504

CLEARINGS AND TRANSFERS.

Total for 1919 to date 8,340,208Total for 1918 50,251,592Total for 1917 27 154,704Total for 1916 5! 533,966Total for 1915 1,052,649

Total clearings and transfers from May 20, 1915, to Feb. 20, 1919 92,333,119



Changes in oivnership of gold.[In thousands of dollars; i. e., 000 omitted.]

Total to Nov. 21, 1918. From Nov. 22, 1918, to Feb. 20, 1919,both inclusive.


Decrease. Increase.

i Balance| to credit! Nov. 21,! plus net; deposits ofI gold since1 that date.

22,851 !

27,865 ;

133,769 |

Boston iNew York 679,471Philadelphia |Cleveland jRichmond i ,Atlanta ! j 38,576 jChicago ! ! 167,464 i-" - • 53,682 !

, ! 36,383 ', ! 39,561 ;

i 26,140 '•. j 106,883 .

50,946106,582

St. Louis.Minneapolis....Kansas City...DallasSan Francisco.

55,50225,3086,762

64,7896,719

20,15222,6289,971

49,961

Total ! 679,471 j 679,471 j 458,002

BalanceFeb. 20,

1919.

41,67442,54741,19356,03619,75919,331

103,58928,65422,48836,94611,12036,665

458,002

Decrease, i Increase,

Total changes fromMay 20, 1915, to Feb.20, 1919.

Increase.

9,272 I.64,035 !.

5,549 |

2,511534

12,56938,80019,9352,336

13,296

14,3181,149

743,506

92,152 | 92,152 \ 743,506

13,579

"30," 376134,30320,74851,145

206,26473,61738,71953,87927,28993,587

743,506

Gold settlement fund—Summary of transactions from Nov. 22, 1918', to Feb. 20, 1919, both inclusive.[In thousands of dollars; i. e., COO omitted.l

Federal ReserveBank.

BostonNew YorkPhiladelphiaClevelandRichmond\tlantaChicagoSt. Louis..MinneapolisKansas ~CitvDallas..San Francisco

Total

Balancelast

state-ment

Nov. 21,1918.

34,69426,58232,72845,57913,9536,425

166,19433,35616,64424,4292,246

39,532

442,363

Goldwith-

drawals.

4

50018,000

370

"*4,"883*

468*

24,236

Golddeposits.

14,35140.0009; 380

22,9237,3668,807

24,1546,2466,7082,1993,1935,747

151,074

Aggre-gatewith-

drawalsand

trans-fers toagent'sfund.

20,00426,00047,46043,00014,01112,970

196,04037,88310,0007,000

46830,000

444,836

Aggro-gate

depositsand

trans-fers

fromagent'sfund.

36,256106,00053,41452,92325,36613,30794,63511,24613,5085,1998,193

40,429

460,476

Transfers.

Debit.

177,45445

58,000338,10045,00081,096

497,801114,270276,399115,00949,801

132,000

1,884,975

Credit.

98,5521,409,892

89,0002,687

18,00083,07561,302

6811,786

106,00014,000

1,884,975

Settlements from Nov. 22, 1918, to Feb. 20,1919, both inclusive.

Netdebits.

1,473,88228,489

55,050

1,557,421

Totaldebits.

1,179,1604,899,3321,500,753

935,185754,382438,540

1,481,056782,056204,415504,242341,119339,994

Totalcredits.

1,248,7903,425,4501,472,2641,271,132

775,833449,130

1,956,355915,580481,364693,569286;069444,698

13,420,234 |l3,420,234

Netcredits.

69,630

335,94721,45110,590

475,299133,524276,949129,327

104,704

1,557,421

Balancein fundat closeof busi-

nessFeb. 20,

1919.

41,67442,54741,19356,03619,75919,331

103,58926,65422,48836,94611.12036 665

458,002

Federal reserve agents1 fund—Summary of transactions from Nov. 22,1918, to Feb. 20,1919, both inclusive.[In thousands of dollars; i. 0., 000 omitted.]

Federal reserve agent at—

BostonNow YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City...Dallas "....San Francisco.

Balancelast

statement,Nov. 21,

1918.

52,000110,00066,963100,00058,00035,170198,38643,63141,80045,36010,684 j

108,561 I

Gold with-drawals.

10,095

i With- ! DepositsGold drawals for i through

deposits. transfers j transfersi to bank. ! from bank.

13,000

6,0008,00033,0005,2006', 000 15,000 11,000 i4,000 I

Total I 869,555 i 91,295 j

21,905 i66,000 j44,034 :30,00018,0004,50070,4815,000 !6,800 !3,000 I5,000 '34,682

20,00026,00046,96025,00014,00012,600196,04033,00010,0007,000

"36," 666'309,402 I 420,600

Total with-1drawals. 1

Totaldeposits.

32,00066,00057,03430,000 !24,000 !12,500 i

103,481 !10,200 i12,800 '8,000 !6,000 !

38,682 I

Balance atclose of

business,Feb. 20,

1919.

20,00026,00046,960 ]25,000 !14,00012,600

196,04033,00010,0007,000

""3*6," 666'400,697 420,600

40,00070,00056,88995,00048,00036,270290,94460,43139,00044,3604,684-97,879

889,457


276 FEDEEAL EESEBVE BULLETIN. MARCH 1,191JK

DISCOUNT OPERATIONS DURING EACHMONTH IN 1918.

The following table and accompanying dia-gram show the monthly changes in the volumeof bills discounted by all the Federal ReserveBanks and by the Federal Reserve Bank ofNew York. Similar data are shown for thevolume of discounted war paper. These dataare supplementary to the information presentedon page 65 of the January BULLETIN, wherefigures of weekly holdings of discounted warpaper and other bills are given.

Beginning with, the month of April, themonth preceding the flotation of the third warloan, there has been an almost continuous in-crease in total discount operations, the onlybreak occurring during the month of November.Operations for December were almost threetimes as large as in April. Of the total volumeof discounts for the year the New York bankreports 61.7 per cent, this share being as highas 73 per cent for the month of June.

About 84 per cent of the year's discountsis represented by war paper. This share on thewhole shows a perceptible increase towardthe end of the year and exceeds 90 per centfor December. About two-thirds of the totalvolume of war paper discounted during the yearis reported by the New York bank. DuringMay and June—i. e., the period immediatelypreceding and following the placing of the thirdwar loan—nearly 80 per cent of all the warpaper was discounted by that bank. Thesepercentages are considerably lower for the latermonths of the year, indicating more than pro-portionate increases in war loan financing onthe part of the other Federal Reserve Banksin connection with the fourth Liberty loan.

During the month of November the Treasurydid not issue any certificates, while a 20 percent installment on the fourth Liberty loan waspaid in during the later part of the month. Asa result, discounts of war paper and totaldiscounts for the month show a decided decline.

Total bills and war 'paper discounted during each month in1918 by all Federal Reserve Banks and by the New YorkFederal Reserve Bank.

[In thousands of dollars; i. e., 000 omicled.]

I January! FebruaryI MarchI April

i JuneJulyAugustSeptember..

| OctoberI November..| December..

I Total.

Total warpaper dis-counted.

392,031399,056307,(521

1,811,4202,517,0272,620,7372,409,4013,127,4304,079, (3715,308,7554,601,33S5,759,297

Per cent Gf

serve "Bank of ! s£n 'e r v ^ .,_TSJOM- YrwL' I i\CWJCOrKi.Oi\ov> IOIK. ! t o t a l w a r p a p C r

| discounted.I

192,373 |155,490 I167.777 i

1,367,204- i1,998,827 I2,084; 878 i1,591,817 !2,040,7452,C52.4233,493! 4S92.738,4233,761,991

4P.139. G54.575.579.479.664.5do. 565.0C5.859.505.3

33,393,784 j 22,254,444 |

•; Total bills dis~i counted.

JanuaryFebruary jMarch IApril IA'lay [Jurio !July !

. August •)j September iI October !•

November \December ,'

868,421762,440759,113

2,178,4112,993,0233,137,2263,343,4583,762,3594,085,1395,903,9635,154,5926,215,083

Total. 39,763,228

Bills discount-ed by the

Federal Re-serve Bank of

New York.

299,141207.801321)342

1,460,6812,181,1432,290,685l,P35,0422,306,0872,893,6163.713,3062,948', 291.3,018,403

24,535,538

Per cent oi"bills discount-

ed by tli oFederal Re-

serve Bank ofNew York tototal bills dis-

counted.

34.435.142.367.172.973.057.961.361. 8(32.957.263. G

61.7


:fl^w«s«f^ssasaffiBffis&s^

Gave /; W&

; SO£s &iscoaiUied BgJfli X X Jkztlo?.

MARCH APRIL MAY JUNE JULY AUG. SSPt OCT. P10V. DEC,

to

g

to


278 FEDBKAL KESERVE BULLETIN. MARCH 1,1919.

DISCOUNT OPERATIONS OF FEDERAL RESERVE BANKS.

For the month of January discount opera-tions of the Federal Reserve Banks aggre-gated $5,994,382,265, compared with therecord total of $6,215,083,531 for the imme-diately preceding month and $868,421,473for January, 1918. Of the total discountsfox the month under review the share of warpaper, i. e.; member banks' notes and cus-tomers' paper secured by United States warobligations, was 95.3 per cent compared with92.7 per cent for December, 1918, and about45 per cent a year before. About 60 percent of the total war paper discounted duringJanuary, as against 65 per cent for the monthbefore, and a slightly smaller percentage ofthe month's total discounts are reported bythe New York bank. With the exceptionof New York and Cleveland all Federal ReserveBanks show increases in discount operationsas compared with Decembei of the past year.

Discounts of member banks' notes, securedby eligible paper, totaled $20,114,004, com-pared with $51,586,141 for December, 1918,the Kansas City bank reporting over 60 percent of this class of paper. Trade accept-ances discounted during the month totaled$10,903,033, compared with 811,942,831 forthe month immediately preceding. Of thesmaller total, $1,166,725 were bills basedupon transactions in the foreign trade handledby the Boston and New York banks, while theremainder were bills based upon transactionsin the domestic trade. '.Che above totals aieexclusive of §1,939,095 of foreign trade accept-ances and $1,241,615 of domestic trade accept-ances bought during the month in open marketby the banks at Boston, New York, and Cleve-land. In addition, four banks report the dis-count of $1,577,514 of bankers' acceptances asagainst $719,812 the month, before.

About 96 per cent of the total discountsfor the month was composed of 15-day paper,i. e., bills maturing within 15 days from date

of discount with the Federal Reserve Bank.Of the remainder more than 75 per cent was90-day paper, chiefly war-loan paper dis-counted by the three eastern banks. Dis-counts of 6-month paper, i. e., agriculturaland live-stock paper maturing after 90 daysbut within 6 months from date of discountwith the Federal Reserve Banks, totaled$11,464,726, of which nearly 82 per cent washandled by the Kansas City and Dallas banks.

Of the total discounts for the month over88 per cent was discounted at the 4 per centand nearly 10 per cent at the 4J per cent rates.Accordingly, the average monthly rate of dis-count for the system works out at 4.15 percent, as against 4.18 per cent in December and4.20 per cent in November of the past year,notwithstanding an increase in the averagemonthly rates of discount shown for the NewYork and Philadelphia banks. Average ma-turities of paper discounted with the banks onthe whole were substantially longer than themonth before, with the resuJt that the calcu-lated average maturity of all the paper dis-counted shows an increase from 8.54 to 10.34days.

On the last Friday of the month the FederalReserve Banks held a total of $1,601,128,000of all classes of discounts, as against $1,702,-938,000 on the last Friday of the month before,and $627,662,000 on the corresponding date in1918. Of the total discounts held, the shareof war paper was 84.8 per cent, as against 82.2per cent the month before and about 50 percent on the corresponding date in January,1918. For the three eastern and the Clevelandbanks -this share is shown in excess of 90 percent, while lor the Kansas City and Dallasbanks the proportion was below 40 per cent.Discounted trade acceptances on hand totaled$13,924,000, compared with $15,985,000 aboutthe end of 1918. Holdings of agriculturalpaper totaled $30,921,000, compared with



$29,384,000 on the last Friday in December,while live-stock paper on hand aggregated$28,710,000, nearly all of which is reported bythe Kansas City, Dallas, and San Franciscobanks.

During the month the number of membersincreased from 8,695 to 8,713. The number ofmembers discounting during January is givenas 3,316, as against 3,288 the month before, asmay be seen from the following exhibit, showingthe number of member banks at the end of thelast two months, also the number of banksaccommodated during these two months:


BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan Francisco

Total

Number of mem-ber banks in dis-trict.

Dec. 31,1918.

424723660814565425

1,333513867994728649

8,695

Jan. 31,1919.

424724663817565425

1,338511868994733650

8,713

Number of mem-ber banks accom-modated.

Decem-ber, 1918.

196379342136238251482176161317388222

3,288

January,1919.

191395351153242245416176168334419226

3,316

Total investment operations of each Federal Reserve Bank during the months of January', 1919 and 1918.

Federal Reserve Bank. ! Bills discounted formembers.

BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City. . .DallasSan Francisco.

8370,959,3983,468,059,283

683,722,748203,974,133283,356,053169,835,236308,946,073139,201,03517,317,075

Bills bought inopen market.

162,593,664

Total, January, 1919.Total, January, 1918.

5,994,382,265868,255,150

$24,383,92075,582,937

883,39031,770,3164,083,6684,088,494

15,436,29010,199,89010,457,4846,048,0562,062,000

16,495,261

201,491,706130,619,509

Municipalwarrants.

i SI, 000

1,0001,247,082

BostonNew YorkPhiladelphia.ClevelandRichmondAtlanta .ChicagoSt. LouisMinneapolisKansas CitvDallasSan Francisco

Total, January, 1919Total, January, 1918

31 per cent.

$1,094,100

4. per cent.

$1,000,000

1,000,00013,243,538

United States securities.

: 1-year4-J per cent. ! Treasury

! notes.

j.

!i|

Sl/H) ;7,025 i7,000 i

14,175 |! 5520,000j

United Statescertificates ofindebtedness.

87,666,000716,083,000

1,860,00016,485,00015,414,0001,167,0006,457,000

500,0008,989,5002,557,500

725,00050,543,000

828.447,00051i;022,000

Total.

87,666,000716,083,000

1,860,00016,485,00015,414,0001,167,0006,457,000

500,0008,989,5002,557,650

732,02551,550,000

829,461,175525,879,638

Total investmentoperations.

January,1919."

8403,009,3184,259,725,220

686,466,138252,229,449302,853,721175,091,730330,839,363149,900,92536,764,059

104,945,37892,871,920

230,638,925

7,025,336,146

January,1918.

$34,672,991786,021,68651,165,270

133,205,719138,591,92822,549,478

218,398,03039,721,6557,747,060

44,769,90712,378,11136,779,544

1,526,001,379

1 All city warrants.



Average amount of earning assets held by each Federal Reserve Bank during January, 1919, earnings from each class of earn-ing assets and annual rates of earnings on basis of January, 1919, returns.

Average balances for the month of the several classes of earning assets.

Discountedbills.

Boston ! 8128,211,454New York i 684,720,582Philadelphia | 177,059,450Cleveland i 110,101,482Richmond.AtlantaChicagoSt. LouisMinneapolisKansas Ci ty . . .DallasSan Francisco..

Purchasedbills.

United Statessecurities.

89,084,19477,734,791

165,739,20964,624,598 I32,371,00066,559,290 |49.464,836 I88,984,131

$15,051,93383,058,8172,872,847

38,767,6876,873,218

11,429,89342,380,6757,688,127

18,851,00017,378,6282,379,419

33,999,542

S9,340,84776,287,08311,812,25515,372,4907,176,9106,988,323

23,003,6298,124,6266,728,000

14,108,6488,369,492

10,810,964

Total, January, 1919 1 1,734,655,017Total, January, 1918 | 611.235,224 |

280,731,786265,590,363

198,123,267148,256,057

Municipalwarrants.

$8,484

8,4841,283,577

Total.

5152,604,234844,066,482191,744,552164,241,659103,134,32296,161,491231,123,51380,437,35157,950,00098,046,56660,213,747133,794,637

2,213,519,5541,026,365,221

Earnings from—

! Dis-! counted! bills.

Boston I §445,833New York ! 2,362,449Philadelphia j 620,820Cleveland ! 394,917Richmond ! 326,210Atlanta I 284,938Chicago | 607,981St. Louis ! 231,759Minneapolis ; 117,566Kansas City. 271,288Dallas.....". 195,726San Francisco i 342,300

Total, January, 1919 iTotal, January, 1918 J

6,201,7872,038,285

Pur-chasedbills.

S53,087297,70410,737

140,35827 67544,529

155,06727,72566,34763,1879,023

126,257

1,021,696

UnitedStates

securities.

SI6,248144,89822,27435,05212,34412,65141,75215,10414,35725,88416,93322,758

380,255403,826

Municipalwarrants.

364,349

Total.

Calculated annual rates of earnings from—

Dis- | Pur-counted | chased

bills. I bills.

S515,2,805,

653,570,366342804,274,198,360,221,491,

I Per cent.i 4.09

4.064.124.134.334.324.324.224.284.804.664.54

7,603,774 |3,267,266 j

4.213.94

Per cent.4.154.224.404.294.484.594.314.254.144.284.474.37

4.293.64

UnitedStates

securities.

Per cent.2.052.242.222.682.252.132.142.192.512.162.382.48

Munici-pal I

warrants, i

Per cent.

2.263.27

5.06

5.063.99

Total.

Per cent.3.973.914.014.084.184.194.104.024.034.334.344.33

4.043.75

Bills discounted for member banks during the month of January, 1919, distributed by classes; also average rates and maturitiesof bills discounted by each Federal Reserve Bank.

Federal ReserveBank.

Customers' Ipaper secured I _

by Govern- \ment war ; Secured by

obligations. Governmentwar obligations.

BostonNew YorkPhiladelphia..ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City...DallasSan Francisco.

Total....

Member banks' collateralnotes.

£57,552,10565,434,14735,788,43710,787,8447,063,7805,488,1165,651,5241", 556,204

6,418315,052812,410

1,085,136

192,141,173

5302,716,8503,303.157,768617j 370,301183,103,000260,933,014135,331,886276,499.667128,158; 85016,478,14069,949,09870,948,810

148,384,462

5,518,031,646

Otherwisesecured.

Tradeacceptances.

Bankers'accept-ances.

All otherdiscounts.

1 $1,470,858 I $320,434 j §6,159,151

709,500702,800

1,095,827625,000 |43,200 j

12,317,1271,814,550 !

6,000

2 3,189,254 1,109', 279 i182,126 ''

1,128,430721,168

95,168,83530,381,8848,954,8597,928,591

987',686 j ; 27,264,948612,710 i i 25,086,345558,5736,107

830,397410,718805.006

20,114,004 10,903,033

142,950 ;

4,851

8,159,458783,210

12,927,99816,091,40711,708,209

1,577,514 250,614,895

Total.

8370,959,3983,468,059,283683,722,748203,974,133283,356,053169,835,236308,946,073139,201,03517,317,07596,339,67290,077,895162,593,664

5,994,382,265

Averagematurityin days.

17.727.209.85

13.7010.7918.0416.6913.9316.8324.2226.6216.65

10.34

Averagerate (365day basis).

Per cent.4.054.074.124.194.284.214.174.174.394.824.654,54

4.18

1 Includes $1,133,412 In the foreign trade. 2 Includes £33,313 in the foreign trade.


M A R C H 1.f 1918. FEDERAL RESERVE BULLETIN. 281

Bankers' and trade acceptances in the foreign and domestic trade and finance bills purchased during the month of January,1919; also average rates and maturities of total bills purchased by each Federal Reserve Bank.

Bankers' acceptances. Trade acceptances.


BostonNew YorkPhiladelphia..ClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas City.. -DallasSan Francisco.

In thedomestic

trade.

19,821,25,763,

44,12,966,2,391,2,851,

14,338,7,367,6,616,2,995,

35,10,488,

Total ! 95,679,683

In the for-eign trade.

r Total.In the

domestictrade.

$14,46,

18,

\:l ,2,3,

1;5

095,313065,628839,390255,206692,500236,600097,211832,206841,235052,199027,000898,055

§23,916,81571,829,037

883,39031,221,8264,083,6684.088,49415; 435,30510.199,89010,457,4846,048,0562,062,00016,386,261

100,932,543 j 196,612,226

81,045,205

196,410

In the for-eign trade.

§367,1051,493,695

78,295

Total.

S367,1052,538,900

27-1,705

Financebills.

Total billspurchased.

; Aver- Aver-i age agei matu- rate; rity in (perI days, j cent).

$100,0001,215,000

273,785

985

109,000

1,241,615 I 1.939,095 j 3,180,710 j 1,698,770

82 4,383,92075,582,937

883,39031,770,3164,083,6684,088,494

15,436,29010,199,89010,457,4846.048,0562; 062,000

16,495,261

44.8441.8539.7178.1469.7873.7071.1233.93 !63.69 !62.27 j44.74 i67.04 i

4.204.214.264.274.564.564.364.264.234.334.624.34

201,491,706 1 54.82 = 4.28

Discounted bills, including member bank's collateral notes, held by each Federal Reserve Bank on the last Friday in January,1919, distributed by classes.



BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis.. .Kansas Ci ty . . .DallasSan Francisco.

Total.Per cent

Total, January, 1918.Per cent .*

Customers'paper

secured byGovern-

ment warobligations.

87,968103,92524,39613,29611,6645,8207,8942,3623,532

3331,5044,064

266,758

16.7154,436

24.6

Member banks' col-lateral notes.

S ecured byGovern-

ment warobligations.

30,114487,317131,95674.29758,37042,548120,23142,08315,67924,57416,04547,599

1,090,813

68.1159,250

25.4

Otherwisesecured.

15

110738

1,20242522

9,9691,048

3

13,532

70,82911.3

Trade ac-ceptances.

1,9732.341'3851,9261,8821,7021,1967357

1,177

600

13,924

17,0332.7

All otherdiscounts.

15,7862 40,020

14,4786,0438,704

18,16913,975«7,804

6237,899

16,378U7,221

157,100

215,41034.3

Total.

125,856633,761171,38895,67983,07471,206153,86553,59421,73363,53650,34877;088

1,601,128

100627,662

100

1 Includes §329,337 of bankers' acceptances.2 Includes $05,555 of bankers' acceptances.

3 Includes SI, 145,544 of bankers' acceptances.* Includes §9,'lC4 of bankers' acceptances.

Acceptances purchased, and held by each Federal Reserve Bank on Jan. 31,1919, distributed by classes of accepting institutions.[In thousands of dollars, i. c , 000 omit tod.]


BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City...DallasSan Francisco.

Totals:Jan. 31,1919..Dec. 31,1918..Nov. 30,1918.Jan. 31,1918..Feb. 5,1917...

Memberbanks.

16,31354,1982,09436,7757,61410,37730,3527,51022,72313,7372,84519,699

224,237234,323310,069240,25950,361

Non-member ;

trust Icom-

panies, i

Non-member

Statebanks.

Foreign !bank-

branchesand

I agencies.

908 !

"i,"276T

4726,842

2,561

538

'662"

"97l"

2.178 i2;545 !2,028 i5,547 .

23,511 !

11,98310,44210,7033,522

972

1,998

Trade acceptances. \Total. ; — — -j Total.

Totel. !

69

324

1.498

22,16319,74027,87122,09013,775

250 I

416

5,919

I19,301 i.80,44S !2,113 !.

47,548 i7; 614 f.

10,377 I.30,421 !.8,298 i.

23,552 :.15,079 ;.2,845 I.

28,087 j .

1,005:480

2,2742096

15,119 I 275.683 !

12,994 j 280,244 J19,818 370,489 !6,947 j 278,374 !.

140 ! 88,759 :.

1,871 i 3,7392,536 I 4.3884,016 1 5; 019

4803,279

20

5,6106,9249,0356,3634,041

19,78183,7272,13348,5107,61410,37730,4218,29823,55215,0792,84528,950

281,293287,168379,524284,73702,800


282 FEDEKAL BESEKVE BULLETIN. MAECH 1,1919.

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, Jan. 31,to Feb. 14, and on Thursday, Feb. 20.

RESOURCES.


Gold coin and certificates:Jan. 31Feb. 7Feb. 14Feb. 20 ,

Gold settlement fund, FederalReserve Board:

Jan. 31Feb. 7Feb. 14Feb. 20

Gold with foreign agencies:Jan. 31 IFeb. 7Feb. 14Feb.20

Gold with Federal Reserveagents:

Jan.31Feb. 7Feb. 14Feb. 20

Gold redemption fund:Jan.31Feb. 7Feb. 14Feb.20

Total gold reserves:Jan. 31Feb. 7Feb. 14Feb.20

Legal tender notes, silver, etc.:Jan. 31Feb. 7Feb. 14Feb.20

Total cash reserves:Jan. 31

Boston.

3,6353,0153,4363,604

45,28939,79241,67341,675

40S408408408

52,22052,07951,34351,156

York.

9,81612,42413,495

110,461105,110109,284110,338

4,1545,0565,2495,650

„ 114,625Feb. 7 1110,166— -- 114,533

115,988

259,612260,597261,690260,805

20,76578,81821,30042,547

2,0112,0112,0112,011

260,979259,121258,669257,793

25,00025,00025,00025,000

568,367625,547588,670588,156

52,93051,66651,65752,307

Jan. 31. . . . . / . . ' i 19,781

Feb. 14Fob. 20

All other earning assets:Jan. 31Feb.7Feb. 14Feb.20

phia.

256194145123

47,62749,57944,81541,193

408408408

78,63275,60372,70271,497

7,9009,53214,30115,372

i134,823135,316132,371

Cleve-land.

14,20320,96621,17221,616

65,83345,59658,01355,923

524525525525

140,744132,620130,996130,482

1,5531,0492,5701,769

222,857200,756213,276

128,593 1210,315

429 ! 1,609379 ! 2,063299 i 1,351386 1,008

Feb. 14Feb.20

Bills discounted:Secured by Government

war obligations—Jan. 31 118,082 iFeb. 7 !l33,374 •Feb. 14 1146,403 iFeb.20 138,158 I

All other— iJan. 31 7,774 IFeb. 7 7,844 jFeb. 14 7,318 !Feb.20 7,831 |

Bills bought in open market: ' [

621,297 Il35,252 1224,466677,213 135,695 |20:>,819620,327 132,670 214,627640,463 128,979 |211,323

591,242 1156,352639,721 1168,186731,071 i 177,622707,364 1177,360

42,51949,22651,44946,917

15,03613,17514,29112,168

Feb. 7 15,588 jFeb. 14 11,213 IFeb.20 12,033 :

United States Government jlong-term securities: i

Jan. 31 ! 538Feb. 7 j 538Feb. 14 ! 538Feb.20 ! 538

United States Government |short-term securities: j

Jan. 31 1 9,416Feb. 7 9,416 i

10 416 !11,416 !

83,727 i 2,13364,524 | 2,15354,927 i 2,274

87,59384,32597,06095,522

8,0867,2826,7457,316

48,51063,23561,750

41,399 j 2,116 j 61,359

1,3941,3931,3931,392

1,385 1,0831,385 i 1,0841,385 | 1,0841,385 j 1,084

Rich-mond.

2,2322,2972,3112,319

16,84813,17620,08819,758

204204204204

54,10652,23150,24649,165

5.0186;6344,694

77,32872,92679,48376,140

223204231264

77,55173,13079,71476,404

70,03477,28681,01984,477

13,04012,56312,00811,480

7,6147,7147,6197,085

1,2341,2341,2341,234

155,853.1 10,800 ! 12,060 | 5,29946,503 I 10,780 ! 11,186 j 5,29948,033 : 11,280 : 11,066 i 5,29952,727 ! 11.280 . 11,340 i 5,375

At-lanta.

8,1268,1998,2528,303

11,75013,81015,94919,331

175175175175

41,18741,07141,24341,398

4,0754,2704,3784,803

65,31367,52569,99774,010

8671,059878857

66,18068,58470,87574,867

Chi-cago.

j St.i Louis.

Minne-apolis.

22,484 i 4,292 1 8,27422,655 i 4,154 ' " " "22,560 ! 4,24422,456 | 4,206

89,71683,845

120,662103,589

816816816816

304,032302,489299,327296,815

24,65031,24124,39726,340

441,678441,046467,762450,016

2,0621,7351,3961,275

443,740442,781469,158451,291

48,368 128,12551,503 128,25358,542 1131,87860,197 i.154,870

22,83819,43017,92915,008

10,3779.6198', 5507,980

528378378

6,5216,9646,9646,964

44 !4 I4 •

25,74025,74920,81217,952

30,42131,45834,70933,249

4,5104,5104,5104,510

17,61217,61216,61216,612

37,95033,62529,08226,654

233233233233

64,26768,66770,47569,442

3,1864,4243,5234,347

109,928111,103107,557104,882

2,5582,4642,3112,232

112,486113,567109,868107,114

44,44541,73743,02545,248

9,1498,4547,2798,355

8,649

8,303

27,45416,09922,589

233233233

58,17457,47555,91855,318

4,6323,6664,1084,619

98,76785,77991,14490,961

181189160173

98,94885,96891,30491,134

19,21118,11015,99917,420

2,5222,2141,9371,992

23,55228,374

15,268 26,57017,991 I 31,604

1,1531,1531,1541,153

7,0687,0687,0687,568

119119119118

9,4689,3959,3009,199

Kan-sas.

City.

203243162112

35,15923,89831,99636,946

291291291291

51,23049,74448,79747,785

3,5044,8885,7046,632

90,38779,08486,95091,766

330293277266

90,71779,35787,22792,032

24,90727,31333,00032,324

38,62940,79539,36337,990

15,07914,19712,24210,864

5,4165,4825,4165,416

Dallas.

5,8725,9115,9465,956

3,7403,9687,993

11,120

204204204204

22,20622,05820,54020,021

2,1792,3062,2081,728

34,20134,447

39,029

1,7671,8171,8221,887

35,96836,26438,71340,916

17,54920,59421,39317,653

32,79932,02432,09933,265

2,8452,9632,5951,800

3,9713,9703,9703,967

4,4004,4004,3993,900

SanFran-cisco.

9,74712,0689,55012,614

20,55516,84423,118

321

321

125,553118,008117,107107,111

1,8202,3235,8664,124

157,996149,564155,962160,835

420506340186

158,416150,070156,302161,021

51,66560,74566,04065,865

25,42524,49822,61921,722

28,95634,22837,35142,440

3.4683,4683,4683,468

22,6195,3985,3515,326

Total.

338,916348,605347,764350,417

422,686419,050437,278

5,8285,8295,829

1,253,3301,231,1661,217,363

91,346103,533111,113112,923

2,112,1062,108,1832,119,3472,125,041

67,54067,43165,97166,491

2,179,6462,175,6142,185.3182, lQi; 532

1,357,5711,451,1471,603,0521,596,458

243,557243,254233,849221,996

281,293282,702275.068269)920

28,25028,10128,095

266,532139,501141,204147,123

4444


MABCH 1, 1919. FEDERAL EESERVE BULLETIN, 283

Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve system at close of business on Fridays, Jan. 81,to Feb. 14, and on Thursday, Feb. 2G—Continued.

RESOURCES.


Boston.; NewYork.

Total earning assets:Jan. ,31 155,591Feb. 7 160,760Fob. 14 175,888Feb. 20 169,976

Bank premises:Jan. 31 ! 800Feb. 7 ! 800Feb. 14 800Feb. 20 j 800

Uncollected items and other jdeductions from gross de- !posits: ;" Jan.31 ! 51,865

Feb. 7 ! 45,680Feb. 14 1 58,671Feb. 20 i 53,617

5 per cent redemption fundagainst Federal Reserve banknotes:

Jan.31 385Feb. 7 432Feb. 14 511Feb. 20 510

All other resources: iJan. 31 ! 367Feb. 7 ! 295Feb. 14 1 333Feb. 20 1 363

Total resources: IJan. 31 !323.633Feb. 7 1324,133Feb. 14 |350,736Feb. 20 1341,254

874,735801,367880,873849,799

2,3432,3682,658

155,188141,365199,761158,814

1,8861,8461,8331,851

3,4032,8942,9482,236

1,658,8521,627,0531.714,4001,655,851

Phila-del-

phia.

!Cleve- | Rich- Iland, j mond. |

At-lanta.

Chi-cago.

! St.! Louis.

185,706 1157,332195,679 167,112206,852 177,705204,309 1176,621

500500500500

78,47469,14478,87670,851

525550575575 |

1,225 I714 ;998 i735 I

97,221 | 88,637104,096107,179109,651

88,04892,36790,531

-i

55,65549,23649,01852,342

533551534525

291 i 217290 ! 217295 ! 217296 217

59,51956,64944,083

36,87330,38531,598

47,922 30,958

206,408207,582208,521227,193

2,9362,9362,9362,936

78,03866,96772,47066.962

270244228

1,032 ! 1,3821,329 I 4001,425 i 499

401,682 1439,018 1236,244402,282 |421,047 234,835420,471 1443,309 232,014405,949 1441,504 234,889

i i

337345364350

466420707436

192,710187,999196,128197,357

70,11367,06173,79480,315

540540540541

Minne-apolis.

54,87258,21253,92560,333

37,662 j 15,87239,783 | 11,78143,328 i 16,97341,830 11,125

325952 274904 I 313872 : 282

1,065 i 4871,187 j 4101,110 i 4321,026 ! 439

733,167 1221,613722,405 1221,635755;099 1228,275750,280 ; 230,521

214304283264

132859490

170,038156,350162,579162,946

Kan- !sas i Dallas.

City.

92,89996,65598,88995,462

400400400400

49,90153,52249,97552,801

633633627

38938841S417

234.93923O',955237,536241,798

61,56463,95164,45660,585

221221221221

22,61925,30519,66618,185

313308298310

657654748717

121,342126,703124)102120,934

132,131128,335134,829138,821

49,78835,04437,04628,371

1,0261,0129-16940

6,7676,8226,8426,809

11,6319,78810,6588,480

342,117 5,075,355315,218 4,970,615329,879 5,194,528329,909 ! 5,113,192

LIABILITIES.

Capital paid In: !' Jan. 31 i 6,778 20,754

Feb. 7 ! 6,773 20,923Feb. 14 ' 6,773 20,925Feb. 20 ! 6,773 20,925

Surplus innd:Jan. 31 1,535 8,322Feb. 7 1,535 8,322Feb. 14 1,535 8,322Fob. 20 1,535 8,322

Government deposits: jJan. 31 9,481 3,482Feb. 7 16,397 20,070Feb. 14 27,920 43,132Feb. 20 24", 150 44,352

Due to members—reserve ac-count:

Jan. 31 102,814 708,910Feb. 7 95,339 859,132Fob. 14 98,880 673,336Feb. 20 96,364 635,846

Deferred availability items:Jan. 31 ". 39,176 113,710Feb. 7 37,537 114,269Feb. 14 45,084 147,206Feb. 20 40,432 I 119,811

Other deposits, including for- jeign government credits:

Jan. 31 2,635 101,550Feb. 7 1,468 99)481Feb.14 1,517 101,583Feb. 20 130 104,470

Total cross deposits:Jail. 31...". 154,106 927,652Feb. 7 150,741 892,952Feb. 14 173,401 965,257Fnb. 20 161,076 904,479

7,5707,4717,4737,566

1,3041,3041,3041,304

6.8101.4; 82018,95015,323

9,0889,0909,2049,209

1,7761,7761,7701,776

12,444 j4,586

19,15515,689

I99,120 1130,443

101,261 |122,25O98;697 j130,18893,287 1128.372

63,51254,94465,53361,019

40,70737,14235,85243.801

i850643

1,011663

170,292 184,401171,674 164,302184,191 185,446170.292 -'188,587

807324251725

4,0604,0624,0644,084

1,1561,1561,1561,156

2.9254', 5735,1216,439

54,13353:87453,25053,517

30,979 j30,595 !30,648 '31,916

55413776

239

88,59189,17989,10192,111

3,1913,1933,1963,196

775775775775

1376404

7,5995,005

48,94242,136

11,23111,29411,29511,300

3,3163,3163,3163,316

3,34410.83225)89229,607

3,8013,8013,8013,820

801801801801

7,5195,60411,10011,610

235,575 I 61,529222,596 I 60)511

;517 224,556 59,50142,859 1220,035 61,461

20,58820,10920,40724,095

4613256445

09,61582,97473,58772,004

49,600 30,25342.617 31,91557;517 35,57352.774 ! 35,251

3,498 i 6752,392 j 1,740853 218

1,130 434

292,017 99.976278,437 99)770308,818 106,392303,546 ! 108,750

2,936 ! 3,6602,940 I 3,6602,948 I2,948

3,6593,712

726 I 1,211726 i 1,211726 i 1,211726 i 1,211

7,6781,9318,023

4,9775,11510,020

9,669 I 14,411

49,868 i 72,00747,186 ! 69,0384.8,033 ! 72,09446,723 \ 70,598

10,549 | 30,6687,369 ! 32,2977,626 j 32,0267,792 ' 34,033

1.948 ! 2,495'274 I 448190 I 346125 98

70,04356,76063,872

110,14.7106,898114,486

04,309 1119,140

3,1723,1773,1043,194

592592592592

1,1996,4693,7564,284

40,26438,33538,10537,501

12.45715)81417,75215,431

1,10822673148

55,02860,84459.68657,304

4,6724,6774,6794,679

1,2241,2241,2241,224

5,4456,002

12,30225,138

89,52778,78380,99577,349

29,84314,61322,50213,902

4,2285,0936,0916,551

129,043104,491121,890122,938

80,91381,06181,21181,406

22,73822,73822,73822,738

64,92896,809192,970205)675

1,693,1321,590,4411,623,1581,563,912

472,042439,221517,726480,257

1:20,809112,551112,273114,758

2,350,9112.239,0222)446,1272,364,602

1 Overdraft.


284 FEDERAL RESERVE BULLETIN". MARCH 1,1019.

Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve system at close of business on Fridays, Jan. 31,.to Feb. 14, end on Thursday, Feb. 20—Continued.

RESOURCES.

[In thousands of dollars: i. e., 000 omitted.]

Federal Reserve notes in actualcirculation:

Jan.31Feb. 7Feb. 14Feb. 20

Federal Reserve Bank notesin circulation—net liability:

Jan. 31Feb. 7Feb. 14Feb. 20

All other liabilities:Jan. 31Feb. 7Feb. 14Feb. 20

Total liabilities:Jan. 31Feb. 7Feb. 14Feb. 20

Boston.

149,565152,4791.55,884158,190

8,2809,1369,5779,989

3,3893,4693,5663,691

323,633324,133350,736341,254

NewYork.

647,913650,046664,613666,858

36,89036,80036,52436,305

17,32118,01018,75918,962

1,658,8521,627,0531,714,4001,655,851

Phila-del-

phia.

209,921208,865214,301213,257

10,31710,53710,67010,919

2,2782,4312,5322,611

401.682402,282420,471405,949

Cleve-land.

231,153232,992233,874228,815

9,93310,05810,10210,144

2,6672,8292,9072,973

439,018421,047443,309441,504

Rich-mond.

136,070133,892130,958130,661

4,7504,8594,9655,055

1,6171,6871,7701,822

236,244234,835232,014234,889

At-lanta.

111,391113,065110,320113,009

6,4626,6786,8786,979

1,2761.314i:3721,394

192,710187,999193,128197.357

Chi-cago.

405,026407,665409,884410,057

17,29917,26517,28117,432

4,2784,4284,5054,629

733,167722,405755,099750,280

St.Louis.

109,367109,442109,282108,979

6,3636,4836,6066,720

1,3051,3381,3931,445

221,613221,635228,275230,521

Minne-apolis.

90,52889,98689,05188,812

4,7464,8304,8724,985

1,0591,1081,1101,168

170,038156,350162,579162,946

Kan-sas.

City.

105.593104,569103,457102,908

12,26012,45212,51612.585

2,0682,1652,1972,242

234,939230.955237,536241,798

Dallas.

55,37654,83253,23952,309

5,8885,9276,0076.051

1,2861,3311,38-41,424

121,342126,703124,102129,934

SanFran-cisco.

198,826196,332193,515192,393

6,2776,2906,2936,301

2,0752,2042,2782,374

342,117315,218329,879329,909

Total.

2,450,7292,454,1652,468,3882,466,248

120.445131,315132.291133,465

40,olS42,32443,77344,733

5,075,3554,970,6155,194,5285,113,192

Maturities of bilU discounted and bought, United States Government short-term, securities, and municipal warrants.

[In thousands of dollars, i. c , 000 omitted.]

Biils discounted:Jan. 31Feb. 7Feb. 14Feb. 20

Bills bought:Jan. 31Feb.7Feb. 14Feb. 20

United States short-term securities:Jan. 31Feb.7 ,Feb. 14Feb. 20

Municipal warrants:Jan. 31Feb.7Feb. 14Feb. 20

With in 15

1,219,0011,302,9531,450,4761,451,139 |

61,546 I76,04882,68981,985

132.8456; 339 '7 869

12,563

16 to 30days.

77,37372,95157,68356,820

74,98465,08363 84.866,051

370

724130

31 to 60days.

95,11288,87387,08795,961

103,623103,872 !

103,96798,850

631967130 !

61 to 90days.

184,717 ••204,S53 "218,152191,538 ;

41,140 .37,699 .24,56423,034

157.169

'217350

Over 90days.

24.92524', 77123,50322,996

132,671125,026132,264134,080

3

Total.

1,601,1,694,1,836.IJ8I8,

281,2821275,269;

266,

128401901454

2&370206g920

532139,501141, 204147,123

4444


MABCH 1,1919. FEDERAL, RESERVE 285

FEDERAL RESERVE NOTES.

Federal Reserve note account of each Federal Reserve Bank at close of business on Fridays, Jan. SI to Feb. 14, and on Thursday,Feb. 20, 1919.

[In thousands of dollars, i. e.,000 omitted.]

!

Boston.

Federal Reserve notes received .from agent—;iet: ;

Jan 31 162,564Feb. 7 159,887Feb. 14 160,110Fob. 20 1161,423

Federal Reserve notes held by ,bank:

Jim. 31 ! 12,999Feb. 7 : 7,408V b 1 4 : 4228Vnb. 14Feb. 20

Fodersl Reserve not<;sin wVat\\circulation:

Jan. 31Tei>. 7Feb. 14Feb. 20

Gold deposited -:;iih or to creditof Federal R o w . ;> ago; it:

Jar.'., 3i -i-'eb. 7Fob. 14Feb. 20

Paper delivered ;:o Federal Re-serve agent:

Jan. 31Feb. 7:-'eb. 1-1Feb. 20

4,2283,233

149,565152,479155,884158; 190

52,22052;07951,34351,156

145,637156.806164,934158,022

York.j Phila-j dci- Cleve-

land.Rich-

mond.At-

lanta.Chi-cago.

767,671 1217,669 1254,562 1141,466767,972 1218,541 1251,853 1140,278779,760 !222,085 ; 250', 494 \.134; 575767,024 225,424 -247,030 i 135,814

119,758117,925115,147100,166

647.913650;046664,613665,858

260,979259, .12125S,669257,793

717,489753,471837,447795,680

114,958 i444,167116,351 1442,624114,774 ;439,462116,589 1436.950

7,748 i 23,409 5,396 3,567 I 39,1419,676 i 18,861 6,386 3,286 ! 34,9597,784 • 16,620 i 3,617 I 4,454 29,57812,167 ; 18,215 ! 5,153 1 3,580 26,893

209,921208,865214,301213,257

78,63275,60372,70271,497

143,199154,433151,538157.072

231,153 136,070 1111,391232,992 i 133,892 1113,065233,874 i 130,558 110,320228,815 1130,661 113.009

405,026 1109,367

140,744 j 54,106132,620 ! 52,231130,996 ! 50,246130,482 i 49,165

138,602 ! 87,500149,041 j 95; 023

41,18741,07141,24341,398

76,85777,007

164,772 ! 98^455 76,396163.409 i 100,892 | 78,049

St. 1 Minne-Louis. apolis.

121,411121,146120,59412i; 121

91,83091,48190,32490,024

12,044 j 1,30211,704; 1,49511,312 1 1,27312,142 j 1,212

Kansas.City. I Dallas.

112,897111,411110,064

56,94855,58254,629

109,551 ! 53,050

7,3046,8426,5976,643

407,665409,884410,057

304.032302', 489299,327296,815

109,442109,282108,979

64,26768,66770,47569,442

90,528 1105,53389,986 j104,56989,051 ! 103; 46788,812 1102,908

58,17457,47555,91855318

51,23049,74448,797477S555,318 47,7S5

184,286185,460187,399 i206,071

59,921 |

65^572 |68,467 i

43,509 78,61546,636 82,30543,984 i 84,60549,824 81,178

1,572750

1,390741

55,37654,83253,23952,309

22,20622,05820,54020,021

53,1935o,uSl56,08752,718

217,277214,733213,831213,835

18,45118,40120,31621. 442 ;

SanFran-cisco.

Total.

2,703,4202,691,8592,690,7022,677,835

252,691237,694222,31421i; 587

198,826 ! 2,450,720196,332 i 2.454,160193,51£ i 2'. 40-8,388192,393 j 2; 466.248

12c,5C3 i 1,253,330118,008 ! 1,231,166117,107 ! 1.217,363107,111 i 1,197.983

94,677 1,823,485105.448 1,920,051106,317 2,037,506112,624 i 2,022,006


286 FEDERAL, RESERVE BULLETIN. MARCH 1,1919,

Federal Reserve note account of each Federal Reserve agent at close of business on Fridays, Jan. 31 to Feb. H and onThursday, Feb. 20, 1919.

[In thousands of dollars; I. e., 000 omitted.]

Boston.

Received from Comptroller:Jan. 31 253,120Feb. 7 253,600Feb. 14 254,560Feb. 20 250,560

Returned to Comptroller:Jan. 31 64,056Feb. 7 07,333Feb. 14 70,070Feb. 20 71,257

Chargeable to Federal Reserveagent:

Jan. 31 188,464Feb. 7 186,267Feb. 14 184,490Feb. 20 185,303

In hands of Federal Reserveagent:

Jan. 31 25,900Feb. 7 26,380Feb. 14 24,380Feb. 20 23,880

Issued to Federal ReserveBank, less amount returnedto Federal Reserve agent forredemption:

Jan. 31 162,564Feb. 7 159,887Feb. 14 160,110Feb. 20 161,423

Collateral held as security foroutstanding notes:

Gold coin and certificateson h a n d -

Jan. 31Feb. 7 iFeb. 14 iFeb. 20

Gold redemption f u n d -Jan. 31 9,220Feb. 7 9,079Feb. 14 9,343Feb. 20 11,156

Gold settlement fund, Fed-eral Reserve Board -

Jan. 31 43,000Feb. 7 43,000Feb. 14 42,000Feb. 20 40,000

Eligible paper, minimumrequired!—

Jan. 31 110,344Feb. 7 107,808Feb. 14 108,767Feb. 20 110,267

NewYork.

Phila- | Cleve-dolphia.j land.

1,305,4801,313,4801,326,6801,326,680

374,309383,508388,920407,656

931,171929,972937,760919,024

163,500162,000158,000152,000

767,671767,972779,760767,024

178,740173,740173,740173,740

12,23915,38114,92914,053

70,00070,00070,00070,000

506,692508,851521.091509,231

330,420330,420330,420330,420

77,36180,38985,290

253,059250,031245,130243,924

35,39031,49023,04518,500

217,669218,541222,085225,424

12,08212,71415,81314,608

66,55062,88956,88956,889

139,037142,938149,383153,927

325,840327,840327,840327,840

42,71345,45747,08150,595

283,127282,383280,759277,245

28,56530,53030,26530,215

254,562251,853250,494247,030

31,65023,27023,27023,270

14,09414,35012,72612,212

95,00095,00095,00095,000

113,818119,233119,498116,548

Rich-mond.

200,580201,780202,820204,820

40,87943,26745,84046,601

159,701158,513156,980158,219

18,23518,23522,40522,405

141,466140,278134,575135,814

2,1062,2312,2461,165

52,00050,00048,00048,000

87,36088,04784,32986,649

At-lanta.

199,600200,560200,560204,560

29,89731,01431,84132,686

169,703169,546168,719171,874

54,74553,19553,94555,285

114,958116,351114,774116,589

2,5042,5042,5042,504

2,4132,2972,469

Chi-cago.

553,600559,440559,440559,440

60,99368,53671,69874,210

492,607490,904487,742485,230

48,44048,28048,28048,280

444,167442,624439,462436,950

St.Louis.

163,7801163,900{164,540! 166,700

' 33,55-135,33936,53137,564

130,226128,561128,009129,136

8,8157,4157,4158,015

122,411121,146120,594121,121

5,0875,5446,382

2,624 j 5,871

36,2703(>, 27030,270

298,945296,945292,945

36,270 |290,944

73,77175,28073,53175,191

140,135140,135140,135140,135

3,3362,7362,5443,011

60,93165,93167,93166,431

57,14452,47950,11951,679

Minne- Kansasapolis. I City.

124,480124,480124,480124,480

21,20021,89922,45623,056

103,280102,581102,024101,424

11,45011,10011,70011,400

91,83091,48190,32490,024

13,05213,05213,05213,052

2,1222,4231,8663,266

43,00042,00041,00039,000

33,65634,00634,40634,706

157,700157,700157,700158,700

31,18332,66933,61634,629

126,517125,031124,084124,071

13,62013,62014,02014,520

112,897111,411110,064109,551

2,8703,3842,4373,425

48,36046,36046,36044,360

61,66761,66761,26761,766

Dallas.

101,960101,900101,960101,960

23,29723,80324,22124,740

78,66378,15777,73977,220

21,71522,57523,11024,170

56,94855,58254,62953,050

12,58112,58112,58112,581

2,9413,2932,7752,756

6,6846,1845,1844,684

34,74233,52434,08933,029

250,520250,520250,520251,520

24,24324,78725,689

SanFran-cisco.

226,277225,733224,831224,835

9,00011,00011,00011,000

217,277214,733213,831213,835

2,000

11,63211,13010,2289,232

111,921106,878106,87997,879

91,72496,72596,724106,724

Total.

3.967,0803;985,6804,001,5204,013,680

824,285858,001883,253916,175

3,142,7953,127,6793,118,2673,097,505

435,820427,565419,670

2.703,4202,691,8592,690,7022,677,835

240,527225,147225,147225,147

80,14284.56283", 76883,379

932,661921,457908,458889,457

1,450,0901,460,6931,473,3391,497,852

1 For actual amount see "Paper delivered to Federal Reserve agent," on page 285.


MAIICH 1, 1919. FEDERAL KESEKVE BULLETIN. 287

MEMBER BANK CONDITION STATEMENT.

Principal resources and liabilities of member banks in leading cities, including member banks located in Federal Reserve Bankcities and in Federal Reserve Branch cities as at close of business on Fridays from Jan. 24 to Feb. 14, 1919.

1. TOTAL FOR ALL REPORTING BANKS.


Boston .i New-York.

Number of reDorting banks:Jan. 24Jan. 31Feb. 7Feb. 14

United States bonds to se-cure circulation:

Jan. 24Jan. 31Feb. 7Feb. 14

Other United States bondsincluding Liberty bonds:


United States certificates ofindebtedness:


Total United States secur-ities owned:


Loans secured by UnitedStates bonds and certifi-cates:


Other loans and invest-ments:


Total loans and invest-ments:

Jan. 24Jan. 31Feb.7Feb. 14

Reserve with Federal Re-servo Bank:


Oash in vault:Jan. 24Jan. 31Feb.7Feb. 14...

Net demand deposits onwhieh reserve is com-puted:


Time deposits:Jan. 24Jan. 31Feb.7Feb. 14

Government deposits:Jan. 24Jan. 31Feb.7Feb. 14

14,35214,40214,40214,402

23,35523,70122,17922,234

95,524102,35390,290106,787

133,231140.456126,871143,423

84,70483,13784,72385,109

761,795758,122756,195753,434

979,730981,715907,789981,966

80,88477,41267,24771,659

22,94621,26822,72022,849

736,627708,411685,120701,918

106,139106,333108,733108,729

40,40455,38948,26149,334

106106106106

46,05146,10146,20146,201

301,343292,176290,218288,174

719,832727,789688,070820,317

1,070,2261,066,0661,024,4891,154,692

656,169641,654653,367624,873

3,970,7743,991,8123,944,6153,962,778

5,697,1695,699,5325,622,4715,742,313

647,056665,999618,148629,340

129,266116,842118,817122,083

4,649,2084,607,7314,485,6334,519,933

252,089259,377250,937258,187

241,668307,800305,566351,948

Phil-adel-phia.

11,49711,49711,49711,497

43,42644,72142,55744,904

85,29797,01794,054113,187

140.220153,235148.708

146,053147,639145,727147,033

627,326022,87260<>,52(>G20,808

913,599923,74(5900,901937,429

59,-82364,77163,93362,239

19,19519,01218,00419,650

628,969632,839037,511631,872

19,17020,08020,40821,310

30,85955,08838,35243,513

Cleve-land-

41,05541,20741,35541,355

Rich-mond.

82

24,99024,94924,94924,949

85,545 ! 55,95180,816 | 60,19277, 238 ! 59,19576,762 ! 56,739

110,598117,388120,260148,712

44,58545,57148,19753,230

237,198 1125,526239,411 |13O,712238,853 132,341266,829 134,918

92,61994;49195,20594,880

38,14140,26239,38539,455

950,030 363,23396(5,860 359,183901,214 367,549909,792 i370,201

1,235,853 1520,9001,300,762 1530.1571,295,272 1539,275Ly 331,501 544,634

93,27091,31983,88291,572

35,37735,25534,22033,487

34,62035,41034,73230,010

18,95517,67518,54717,226

782,470 323,045784,828 1324,7787*3,013 328,222802,527 324,189

278,231280,150281,848283,294

04,11007,19165,56768,900

57,209 11,27634,115 23,85047,623 I 14.42054,382 I 14; 483

At-lanta.

15,26515,26515,26515,265

42,81140,88736,95435,292

47,11745,11146,50355,122

105,193101,26398, 722

105,679

19,67418,26418,08218,205

314,012311,408301,478295,561

438,909430,995418,282419,445

28,21532,65328,09130,980

10, US14,93214,49214,509

246,855242,024243,505244,791

99,890100,778102,327101,440

11,08217,64711,04415,018

Chicago.

101101101101

19,85519,85719,85519,855

104,43990,97082,09473,009

162,590183,478180,166212,577

294,311282,115305,441

78,98670,17386,78385,326

1,303,3981,357,6291,334,4041,372,905

1,729,2741,722,1131,703,3021,703,732

157,020157,359157,321159,283

04,30064,58662,0G865,584

1,160,5371,108,5711,140,7891,189,781

402,870405,038408,903410,243

57,79809,09872,20259,837

95,796 ! 45,50892,550 :i 48,31390,725 I 47,377

100,565 52,104

St. Minn-Louis, eapolis.

3 8 |

17,15517,15416,90816,907

6,4196,4696,4696,466

39,456 12,38231,780 13,32130,242 ! 12,50131,082 12,064

39,18543,62243,57552,576

26,70728,52328,40733,574

24,1.9124,07924,21724; 417

372,555379,280368,379380,020

492,542495,915483,321505,002

39,39540,40(541,75539,811

12,59111,02710,80011,032

296,360300,020300.170303,131

90.92092;07992,05292,014

17,10020,30019,06320,441

10,11225,27810,49010,337

225,099220,124230,599219,552

280,719293,715238,406281,993

22,85522,31921,70322,470

9,3958,5968,(1018,704

211,522223,913214,015210,747

50,34355,67050,87851,203

11.397GJ695

10,254

KansasCity.

13,71213,71213,77913,780

30,86329,08927,86520,765

30,83431,56631,34238,650

75,40974,90772,98679.195

11,27911,38311,00411,009

438,484430,441441,324435,609

525,172522,791525,314525,813

40,27746,72840,20243,034

16,31816,03115,ISO15,501

17,92917,92918,02917,929

21,39321,44321,19120,600

15,90815,83015,66216,947

55,23055, 20254,88255,476

7,8208,0548,6808,661

175,430174,315171.141170,119

238,480237,571234,703234,256

17,17018,61018,12717,995

9,3138,9439,3529,058

386,893 i152,170387,091 ! 153,844380,415 152,509391,S34 157,960

65,72360,20307,11765,051

27,49825,80528,20928,301

10,044 4,44819,930 I 4,20511,899 i 2,98715,700 I 2,603

SanFran-cisco.

34,50534,50534,50534,505

36,03540,02536,874

79,03676,52876,82991,314

149.576151,058148,208161,907

19,60318,83120,69020,7.26

523,977522,014522,587522,039

693,156092,503091,485704,072

49,02654,40549,41550,989

21,17619,78319,76421,395

421,135417,149423,915433,184

130,596131,745132,813134,990

308,2022,597

423

Total.

772772771771

262,785263,047263,214263,111

799,999769,727739,108723,713

1,457,2191,514,7761,463,9551,742,993

2,520,0032,547,5502,466,2772,729,817

1,189,3511,183,2451,198,3531,170,031

10,092,14910,100,72010,000,01110,072,938

13,801,50313,831,51513,670,01113,972.786

1,275,6231,307,4541,225,2191,255,438

368,298353,950353,177361,138

9,995,7919,952,4089,780,9079,911,607

1,587,5971,611.7211,616', 4521,624,454

489,447693,681581,909014,536


288 .FEDERAL RESERVE BULLETIN. MARCH 1,1919.

Principal resources and liabilities of member banks in leading cities, including member banks located in Federal Reserve Banhcities and in Federal Re-nerve Branch cities as at close of business on Fridays from Jan. 24 to Feb. 14,1919—Continued.

2. MEMBER BANKS IN FEDERAL RESERVE BANK CITIES.

[In thousands of dollars; i. e. 000 omitted.]

Bo ton,! NewYork.

Phil-adel-phia.

Number of reporting banks:.Tan. 21Jan. 3iFeb. 7Feb. 14

United States bonds to se-cure circulation:

Jan. 24Jan. 31 ...Feb. 7Feb. 14

Other United States bonds,including Liberty bonds:

Jan. 24Jan. 31Feb.?Feb. 1-1

United States certificates ofindebtedness:


Total United States securi-ties owned:


Loans secured by UnitedStates bonds and certifi-cates:

Jan. 24Jan.31Feb.7Feb. 14

Other ioans and invest-ments:

Jan. 24Jan.31Feb. 7Feb. 14

Total loans and invest-ments:


Reserve with Federal Re-serve Bank:


Cash in vault:Jan. 24Jan. 31Feb. 4Feb. 14

Net demand deposits onwhich reserve * is com- \nnted: !* Jan. 24 565,406

Jan. 31 i 545,425Feb. 7 1522,182Feb. 14 1536,674

Time deposits: IJan. "24 ! 32,016

31,64433,288

4,2284,2784,2784,278

13,41013,58712,30312,190

69,66574,53662,42373,220

87,30302,40179,004

67,093(55,19567,47867,691

535,457533,124531,162526,882

689,853690,720677,644684,281

66,34762,67853,49157,353

13.75112,73913,98814,166

Jan. 31Feb. 7 .Feb. 14 | 33,311

Government deposits: 'Jan. 24.Jan. 31.Feb. 7...Feb. 14..

31,61543,50037,990

£5 !Go !65 !65

i

35,783 !35,88335,983 135,983 I

250,357245,572246,554216,282

7,4877,4877,4877,487

34,51534,88732,99535,586

Cleve-land.

! Rich-i mond. !

At-lanta.

677,237 74,051680,490 86,126642,664 | 8-4,030765,179 100,699

969,377961,945925,201

1,047,444

611,077595,076610,341582,392

3,567,5453,603,2313,570,0793,577,771

5.147,9995; 160,2525,105,6215,207,607

612,674627,034583,670596,269

107,571103,140104,418107,228

4,272,1584,233,7754,119,8324,145,539

116,053128,500124,512143,772

138,739140,289140,679141,840

552,675548,855531,609545,067

807,467817,644796,800830,679

53,76658,50557,68358,033

15,30115,09114,74416,059

549,496552,832557' 356551,594

195,877 11,978202,723 12,394200,087 12,840200,855 13,429

225,360344,081287,546

28,12350,59335,808

307,386 ! 40,251

Chicago. St. ! Minn- .. KansasLouis.! eapolis.j City.

!11 !II I

4,4714,4714,4714,471

2,7732,7322,7322,732

17,944 • 8,59117,430 1 10,00915,423 9,91414,209 9,526

22,30025,15725,41832,344

44,71547,05845,31251,024

25,61027,80929,03828.725

265,320268,478270,710273,682

7,0996,7957,7778,426

18,46319,53620,42320,684

3,8003,800 j3,800 |3,800 !

5,6565,1614,7544.042

8,0847,4747,2718,436

17,54016,43515,82516,278

14,551 4,19015,620 3,94415,314 4,30714,954 I 4,320

444444 :44

1,119 i1,119 :1,119 I1,119 i

46,06735,40431,51626,558

87,340107,956105,493119,871

135,126144,479138,123147,54S

56,45546,80663,78462,180

73,15370,29670,40974,418

57,47859,86758,43851,326

843,771843,486812,181847,7S6

335,645 |l06,167 | 79,208 [l, 035,352105,452 j 80,246 !1,034,771343,345

345,060353,431

106,146

22,642 6,10322.850 6,73317; 013 ! 6,45621,422 I 6,472

8,219 ;7,4057,5067,662

177,916174,444176,951181,094

122,193122,665123,455123,742

14,30S9,67113,67617,002

1,8851,4851,6761,625

57,92061,80659,91958,245

6,3798,5757,6748,710

78,570 1,014,073110,056 71,924 1,057,514

4,0246,7435,4135,680

2,6932,7212,4792,397

44,07842,49442,36243,509

17,932 I19,060 I19,239 '19,394

1,912 2,6235,081 I 3,6152,548 j 2,0192,317 j 2,495

107,621109,743109,336109,207

39,60938,70637,93939,227

783,471788,192776,641799,410

153,72G155,219156,239157,450

39,93151,37153,84039,054

15 ! 8 ;15 ! 8 !15 i 8;is 1 8 :

10,555 i 2,34010,555 j 2,39010,553 i 2,39010,552 2,387

26,894 2,47519,992 2,35918,107 I 1,95018,946 ! 1,763

28,55730,99529,74536,528

66,00661,54258,40566,026

18,34818,30218,048

10,63711,90012,33614,265

15,45216,64916,67618,405

5,6705,5405,576

18,376 J 5,512

251,216 ! 96,021258,562 i 95,383256,858 1103,914258,434 ! 94,802

335,570 1117,143338,406 1117,572333,311 !128,166342,836 ; 118,719

28,291 I 10,86530,597 I 10,62329,415 i 9,92328,131 ! 10,605

7,224 j 2,9406,133 ! 2,4456,376 ! 2,3776,198 2,716

200,004206,260204,298204,154

62,96762,88862,38863,122

92,59689,48397,34290,310

17,31917,38817,28617,466

13,211 2,40519,811 3,89413,827 i 2,90518,984 ! 4,369

4,5984,5984,5904,591

8,0457,1636,882

6.5527; 1806,7729,974

20,04919,82318,52521,447

1,8632,0502.1322,381

151,369154,389153,990153,041

173,281176,262174,647176,869

15,77911,80013,27015,080

5,0644,5144,1794,596

136,803134,000136,911137,905

8,3878,4588,4307,481

4,6339,7775,6748,093

Dallas.

4,0604,0604,0604,060

4,6074,8294,5724,408

7,2217,6537,6618,378

15,94816,54216,29316,846

2,6042,9433,3062,712

39,71441,05039,77639,962

58,26660,53559,475 -..,59,520 278,

4,1085,0014,0884,587

1,3181,5341,6901,621

39,34741,26042,12442,754

3,1283,0973,1383,101

2,4062,4451,4671,528

SanFran-cisco.

Total.

18,400 i18,400 I18,400 i18,400 i

13,73415,20314,47414,109

30,57827,48927,50633,661

62,71261,09260,38066,170

9,0017,96210,20510,212

202,098205,046203,655202,252

273,811274,100274,240""{ 634

18,43725,10218,49118,396

5,7095,2615,7055,485

171,763169,431172,687172,579

10,08210,33210,87510,535

4,8801,407423

254255255255

99,61499,77399,863

439,809412,478399,725394,491

1,029,3211,073,7511,019,0961,210,981

1,568,7441,586,0021,518,6841,705,332

955,201931,536970,188941,295

6,635,8176,681,7676,602,7816,645,423

9,159,7629,199,3059,091,6539,292,050

950,657977,409908,249929,235

211,284201,174203,077208,980

7,090,9587,039,4026,908,6056,963,767

641,984654,443654,939658,596

366,557548,719458,707478,430


MARCH 1, 1910. FEDERAL RESERVE BULLETIN". 289

Principal resources and liabilities of member banks in leading cities, including member banks located in Federal Reserve Bankcities and in Federal Reserve branch cities as at close of business on Fridays from Jan. 24 to Feb. 14, 1919—Continued.

3. MEMBER BANKS IN FEDERAL RESERVE BRANCH CITIES,

fin thousands of dollars; i. e., 000 omitted.]

.Cleveland! Richmond Atlanta! District.*! District.2 District.*

Number of reporting banks: iJan. 24 'Jan.31Feb. 7 ;Feb. 14 |

United States bonds to secure circulation: !Jan. 24Jan. 31 !Feb. 7 iFeb. 14 ,

Other United States bonds, including Liberty !bonds: !

Jan. 24 1Jan. 31 1Feb.7Feb. 14 1

United States certificates of indebtedness:Jan. 24Jan. 31Feb. 7Feb. 14.

Total United States securities owned:Jan. 24Jan. 31Feb.7Feb. 14

Loans secured by United States bonds and certifi-cates:


Other loans and investments:Jan. 24Jan. 31Feb. 7Feb. 14

Total loans and investments:Jan. 24Jan. 31Feb. 7Feb. 14

Reserve with Federal Reserve bank:Jan. 24Jan.31Feb. 7Feb. 14

Cash in vault:Jan. 24Jan. 31Feb. 7Feb. 14

Net demand deposits on which reserve is computed:Jan. 24 "Jan. 31Feb. 7Feb. 11

Time deposits:Jan/24Jan. 31Feb. 7Feb. 14

Government deposits:Jan. 243an.31Feb. 7.Feb. 14

23,31623,31623,61623,610

51,34747,03247,02948,706

67,87971,24573,68191,212

142,542141,593144,326163,534

56,99356,73956,07155,964

512,240515,900508,494511,689

711,775 j714,232 I708,891731,187

55,478 !52,473 I51,19954,458 |

16,451 !15,583Hi, 01715,831

454,172458,982451,08340(5,148

88,06288,91889,37789,786

37,232 !20,708 •27,999 .31,070 :

Chicago 1st. Louis ; KJS!?S

District.* \ District.*! Districtc

! ! _ i

181818 |18 j

4,9914,9914.9914,991

8,1509,2979,0998,253

18,14219,07719,93921,881

31,28333,36534,02935,125

11,18811,98211,94611,936

97,09595,269106,682107,798

139,566 |140,616 I152,657154,859

12,78712,362 I13,226 i12,468 |

0,511 '6,692 j5,770 I5,671 I

103,806 !109,014 !112,382 '112,453 ;

13,966 j13,56613,207 •'13,331 '

4,578 !9,718 j6,622 I0.548 i

21212121

5,0855,0855,0855,085

18,13416,75915,71615,266 |

27,21026,52226,97631,922

50,42948,36647,77752,273

10,6739,4649,3069,198

169,491164,824164,037164,229 i

230,593 I222,654 I221,120 !225,700 !

17,164 |18,603 •16,42217,985

8,4797,836v.397 !7", 090 i

146.215143) 500142,724142,181

49,41549,30149,18049; 547

6,35510,0976,796 !9,513 I

12121212

19191717

1,8051,8051,8051,805

24,94822,99620.03919', 843

40,06240,22439,30549,325

66,81565.0256li 14970,973

9,0259,8979,6709,799

249,999248,459247)676247, 765

325,839323,381318,495328,537

22,82421,41821,38922,010

10,919 I11,301 i10,801 !12,375 |

157.543 I158)259 !

151,815161,620

158,284159,433160,799161,445 !

7,914 I9,551 !7.844 I11)833 I

5,250 I 4,4875.249 i 4,4875)005 I 4,4875,005 i 4,487

10,94810,30310.75210)235

9,31811,09912,22914,775

25,51626,651

30,015

.4,4344,4924,8894,725

106,228105,42798,368105,430

136,178136,570129,241140,170

10,0909,23811,07810,516

4,1553,7974,114

80,40787,11085,53388,754

21,23221.453 I23,42621,993

3,6046,0475,402

8,9259,6059,6798,628

13,03413,05313,11815,341

26,44627,14527,28428)456

6,6946,0390,3815,830

149,527150,151148,080148,240

182,667183,935181,745182,538

15,96015,11413,59913,549

5,3405,5445,4055,543

124,140122,893120,541122,774

DallasDistrict.7

1,2551,2551,2551,255

2,4192,1482,0992,108

1,4291,5391,5511,544

5,1034,9424,9054,907

367360367375

14,15013,71814,09313,908

19,62019,02019,36519,190

ban JTan-icisco j Total.

District.* j

28272728

8,4858,485

8,485

14,34115,83714,63014,710

36,64337,76337,55343,385

62,08560,66806,580

6,402

5,9595)883

211,410205,755207, S35210,225

277,281273,749274,462

160159157158

54,67454,67354,72954,729

139,212133,977129,043127,749

213,717220,522224,352269,385

407,603409,172408,124451,863

105,776105,482104,589103,716

1,510,1401,499,5031,493,2031,509,290

2,023,5192,014,1572,005,9762,064,869

156,338149,509149,180154,643

60,15059,13856,46259,217

1,242,0461,242,3501,233,8771,207,080

461,065461,497468,433471,220

62,83361,13659,50070,246

1 Pittsburgh and Cincinnati.2 Baltimore.3 New Orleans, Jacksonville, and Birmingham.' Detroit.

5 Louisville, Memphis, and Little Rock.6 Omaha and Denver.7 El Paso.8 Spokane, Portland, Seattle, and Salt Lake City.


290 FEDEEAL EESEEVE BULLETIN'. MARCH 1,1919.

IMPORTS AND EXPORTS OF GOLD AND SILVER.

Gold imports and exports into and from the United States.

[In thousands of dollars; i. e., 000 omitted.)

IMPORTS.

Ore and base bullionUnited States mint or assay office barsBullion refinedUnited States coinForeign coin

Total :

EXPORTS.Domestic:

Ore and base bullion . . .United States mint or assay office barsBullion, refinedCoin

Total

Foreign:Bullion refinedCoin.. .

Total

Total exports . . . . . . .

Ten daysending

Jan. 20, 1919.

341

1738

522

135

306

441

19

19

460

Eleven daysending

Jan. 31,1919.

843

37

880

2,395

2,395

2,395

Ten daysending

Feb. 10,1919.

261

262

523

1

i1,193

1,195

1,195

Total sinceJan. 1,1919.

2,006

6228

2,636

1351

4,435

4,572

19

19

4,591

Total, Jan. 1,1918, to Feb.

8,1918.

1,025

1,4412,100

4,581

11

124,216

4,239

172

172

4,411

Excess of gold exports over imports since Jan. 1,1919, §1,955,000.Excess of gold imports over exports since Aug. 1,1914, $1,069,451,000.

Silver imports and exports into and from the United States.


IMPORTS.

Ore and base bullionUnited States mint or assay office barsBullion, refined . . . . . . . .United States coinForeign coin

Total

EXPORTS.Domestic:

Ore and base bullionUnited States min t or assav office bars . . . .Bullion, refinedCoin . . . . .

Total

Foreign:Bullion, refinedCoin.

Total

Tota^ exports ,

Ten daysending

Jan. 20,1919.

589

431596

743-

4,7142,135

6

6,855

9222

114

6,969

Eleven daysending

Jan. 31,1919.

2,255

24925

188

2,717—

6,0204,121

72

10,213

29260

289

10,502

Total Jan. 1to

Jan. 31,1919.

4,389

68403

5,576

10,7348,079

78

18,891

182542

724

19,615

Total Jan. 1to

Jan. 31,1918.

2,489

3,17093

245

5,997

15,972

44

6,017

223387

610

6,627

Ten daysending

Feb. 10,1919.

1,854

25422

454

2,584

9,2i888320

10,121

114

114

10,235

Total sinceJan. 1,1919.

6,243

97090

857

8,160

19,9528,962

98

29,012

182656

838

29,850

Excess of silver exports over imports since Jan. 1, 1919, 321,690,000.Excess of silver exports over imports since Aug. 1,1914, §301,450,000


MARCH 1, 1919. FEDEBAL RESERVE BULLETIN". 291

Estimated general stock of money, money held by Treasury and by the Federal Reserve System, and all other money in the UnitedStates Feb. 1, 1919.

Gold coin 2Gold certificatesStandard silver dollarsSilver certificatesSubsidiary silverTreasury notes of 1890United States notesFederal Reserve notesFederal Reserve bank notes.National-bank notesTotal:

Feb. 1,1919Jan. 1,1919Dec. 1,1918Nov. 1,1918Oct. 1,1918Sept. 1,1918Aug. 1,1918July 1,1918Jan. 1,1918Apr. 1,1917

General stockof money in theUnited States.

§3,085,459,209

373,685,930

242,203,752

346,681,0162,703,420,225

138,250,180721,928,498

7,611,628,8107,780,793,6067,609,576,5807,590,173,1717,391,008,2777,092,955,3716,895,089,7996,742,225,7846,256,198,2715,312,109,272

Held in theUnited States

Treasury asassets of the

Government.1

$330,089,676

8,258,055

11,515,17537,115,2872,857,36648,761,064

489,831,726454,948,160416,383,232399,321,725380,246,203369,937,060390,798,058356,124,750277,043,358258,198,442

Held by or forFederal Reserve

Banks and

81,475,074,167459,714,110

9,287,1202,726,187

55,525,750222,948,540

7,703,57919,778,107

2,252,757,5602,220,705,7672,123,208,4872,125,198,8012,084,774,8972,070,371,8032,054,455,9932,018,361,8251,723,570,291

952,934,705

Held outside theUnited StatesTreasury and

Federal Reserve

Amount percapita outside

I the Unitedi States Treasury! and the Fed-! eral ReserveI System.

$418,094,011 !402,487,245 I87,479,957 i223,898,835231,219,510

1,784,915279,640,091

2,443,356,398127,689,235653,389,327

4,869,039,5245', 105,139,679 !5,129,984,861 I5,065,652,645 j4,925,987,177 j4,652,646,508 |4,449,835,748 i4,3(57,739,209 !4,255,584,622 |4,100,976,125 j

§45.5647.8348.1347.5946.3443.8341.9741.3140.5339.54

1 Includes reserve funds against issues of United States notes and Treasury notes of 1890 and redemption funds held against issues of national-iibank 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.


292 FEDERAL EESEBVE BULLETIN. MARCH 1,1919.

DISCOUNT RATES.

Discount rates of each Federal Reserve Bank approved by the Federal Reserve Board up to Jan. 31, 1918.


33ostonNew York1

Philadelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City...DallasSan Francisco.

Maturities.

Discounts.

Within 15days,

includingmemberbanks'

collateralnotes.

16 to 60days.

61 to 90days.

Agricul-tural andlive-stock

paperover 90days.

I

iti4j42o555

Secured by U. S. cer-tificates of indebted-ness or Liberty loanbonds.

Within 15days, in-cludingmemberbanks'

collateralnotes.

Trade acceptances.

ltoGOdays,

inclusive.

61 to 90days.

inclusive.

1 Rates for discounted bankers, acceptances maturing within 15 days, 4 per cent; within 16 to 60 days, 41 per cent; and within 61 to 90 days,•if, per cent.

2 Rate of 4 per cent on paper secured by fourth Liberty loan bonds where paper rodiscounted has been taken by discounting member banksat rate not exceeding interest rate on bonds.

NOTE 1.—Acceptances purchased in open market, minimum rate 4 per cent.NOTE 2.—In case the GO-day trade acceptance rate is higher than the 15-day discount rate, trade acceptances maturing within 15 days will be

taken at the lower rate.NOTE 3.—Whenever application is made by member banks for renewal of 15-day paper, the Federal Reserve Banks may charge a rate not

exceeding that for 90-day paper of the same class.



OPERATION OF THE FEDERAL RESERVE CLEARING SYSTEM, JAN. 16. 1919, TOFEB. 15, 1919.

BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan FranciscoTotals:

Jan. 16 to Feb. 15,1919Dec. 16,1918, to Jan. 15,1919.Nov. 16 to Dec. 15,1918Jan. 16 to Feb. 15,1918

Items drawn on banks inFederal Reserve city(daily average).

Items drawn on banks indistrict outside Federal

I Reserve citv (daily aver-! age).

Total items drawn onbanks in own FederalReserve district (dailyaverage).

Number.

13,928 ;15,63721,0515,215 i2,183 !2,371 I

14,674 I4,938 i3,564 i4,4221,412 :1,549

90,944 !95,62285,174 ,46,207 i

Amount'.

§20,807,36477,738,63626,519,902 I6,792,011 !

7,688,6192;385,80825,333,000 !7,935,372 j8,631,890 i9,464,557 !2,153,9563,484,309

198,935,424221,889,946219,162,199 !153,847,568 !

Number.

76,359145,21539,33157,83542; 61723,64153,41530,99020 71854,76724,07230,991

599,951635,080590,685227,312

Amount. Number.

810,149,52950,513,399 i5,235,218 ;

23,327,07713,168.9296,824;4249,877,000 ;7,374,527 i1,855,43813,038,5197,073,3897,923,310 :

156,360,759 :165,386,737 !167,471,89380,248,466 ;

90,287160,85260,38263,05044:80026;01268,08935,92824,28259,18925.48432;540

890,895730,702675,859273,519

Amount.

830,956,893128,252,03531,755,12030,119,08820,857,5489,210,232

35,210,00015,309,89910,487,32822,503,0769,227,345

11,407,619355,296,183387,276.683386,634,092234,096,034

BostonNow YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallas ISan FranciscoTotals:

Jan. 16 to Feb. 15,1919......Dec. 16,1918, to Jan. 15,1919Nov. 16 to Dec. 15.1918Jan. 16 to Feb. 15,1918

Itemsdrawn on banks \

Number. Amount. j Number. Amount.

9,06631,11721,1303,2825,0312,5545,506

7541,1695,9733,655

735

S9,97299,82888,32644,654

510,092,95214,818,5658,960,9435,294,2986,112,7193,246,3701,267.000663,044

1,469,1093,913,4871,666,048926,995

58,431,53064,079,66066,301,70142.852,372

2,010206

3,629341858

2,800977

1,986

12,80713,66213,3947,128

I tems drawn on Treas- |urer of United States \(daily average). | °\

; member_ _ i banks in

" " d i s t r i c t .^Number. Amount, j

$2,738,894639,102

1,852,349298,000537.625

2,314,470200,118

2,455,842

11,036,4001O,OSO,44O10.704,9005:836,958

8,81653,6147,8346,7023,348 i5,242

15;2579,7591,0556.7033;284 :4,437 I

126,051 i77,282 !135,173 !

48.224 ,

33,706,628 :25,202,729 •4,244,132 !2,588,546 j

487,030 I2,081'. 600 :5,233,0003,017,237210,129 ;754', 704 I537,511

15,157,756 I

63,221,002 :37,753,800 .60,766.938 ••21.316,033 I

424722636819068426

1,338511871994735653

8,7178,691S,6437,972

Numberof non-

memberbanks onpar list.

*244321345755312227

2,5001,2331,2072,190

2491,039

10,62210,34210,281

Numberof non-

memberbanks indistrict.

244321425

1,1321,5071,5744,1602,5722,8383,1901,1841,201

20,348

9,319 j.


294 FEDERAL RESERVE BULLETIN. MARCH 1,1919=

CONDITION OF PRINCIPAL EUROPEAN BANKS OF ISSUE, 1913-1918,

Bank of England.

(Combined data for issue and banking departments.)

(From the London Economist.)

[In thousands of dollars; i. e., 000 omitted.}

| Bee. 31,1913.

ASSETS.

Gold and silver 170,245Government securities: |

Held by issue department j 89,787Held by banking department j 64,233

Other securities | 253,729

Total | 577,994

LIABILITIES.

Proprietors' capital 70,822Rest (surplus) 15,827Public deposits 49,913Other deposits 297,280Seven-day and other bills 66Notes in circulation j 144,086

Total ! 577.994

Dec. 30,1914.

338,191

89,78772,061516,998

1,017,037

70,82215,978131,067623,182

116175,872

1,017,037

Dec. 29, 1915.

250,510

89,787159,816545,416

1,045,529

70,82216,118241,755544,914

87171,833

1,045,529

Dec. 27, 1916.

264,275

89,787278,304518,094

1,150,460

70,82216,111

253 624616,715

107193,081

1,150,460

Dec. 26, 1917.

53,605283,732497,958

1,119,194

70,82216,065204,439604,232

50223,586

1,119,194

Dec. 25,1918.

384,994

53,604346 037484,582

1,269,217

70,82215,850115,059725,289

48342,149

1,269,217

Bank of France.

(From weekly statements of the Bank of France J


Gold in vaultOther metallic reserve

Total vault reserveGold held abroadForeign creditsGovernment securities:

Bonds, consols, and advances to the Government-Permanent investmentsAdvances to she Government; since outbreak of war.Treasury bills discounted (advances to foreign

Governments)Other Government securities

Loans and discountsBills matured and extendedAdvances on bullion, specie, securities, etcBank premisesSundry assets

Total.

LIABILITIES.

CapitalSurplus, including special reserves...Dividends unpaidGovernment depositsOther depositsBank notes in circulationSundry liabilities

Total.

Dec. 26,1913.

678,856123,532

802,388

57,900

294,607

"149," 074'

'"93^064"

1,397,033

35,2238,206

30977,848

111,0381,102,715

61,694

1,397,033

Dec. 10,1914.1

799,35967,750

807,109

694,800

Dec. 30,1915.

967,95067,953

-!41,165

702,040 I2150,686 j

1,035,903

"*."263," 962

57,900965,000

121,59021,88282.859354,002222,320

79,806

3,145,224

Dec. 28,1916. Dee. 27,1917. Dec. 26,1918.

652,88556,910

709,795326,766159,380

57,9001,428,200

347,40021,742119,599258,395254,326

105,919

639,68247,798

687,480393.102150;231

57,9002,412,500

621,46021.805

176; 009221,395236,386

130,0-16

! I"

35,223 ;

34,075 !515,087 i

1,927,306 j

35,2238,2924,211

33,562407,970

2,568,801S7,165

3,145,224

3,789,422

35,223 i8,292 !4,8532,897

3,219,01282,922

3,7S9,422

5,108,374

35,2238,2924,985

48,609562,352

4,311,002137,911

5,108,374

664,00961,441

725,450393,162450,939

57,9003,309,950

680,51821,757

401,614

"234,"6338,960

299.202

6,534,085

35,2238,292

<>7321,555

456,6765,838,172

223,194

6,584,085

1 No data available as at end of 1914. Incomplete data for Dec. 10,1914, taken from the annual report of the bank for 1914.2 Advances.on securities onlv.



German Eeichsbanh.

(From the Deutscher Reiclisanzeiger).

[In thousands of dollars; i. e., 000 omitted].

Gold

Other metallic reserve.Total metallic reserve

Imperial Treasury and Loan Bank certificates.Notes of other banksBills, checks, and discounted Treasury bills....Advances on collateralSecuritiesSundry assets

Total.

LIABILITIES

Capital paid inSurplusNotes in circulationOther liabilities payable on demand.Sundry liabilities

Total.

Dec. 31,1913.

278,45365,886

344,33910,9963,038

354,79822,48596,01253,582

885,250

42,84016,671

617,240188,76319,736

885,250

Dec. 31,1914. Dec. 31,1915.

8,774

506,863208,250

1,264936,903

5,4438,086

51,173

Dec. 30,1916. | Dec. 31,1917.

581,954 j7,633

589,587306,512

7451,381,189

3,07912,22764,791

599,873 .3,884 ".

572,76843,161

1,717,982

42,840 i17,726 i

1,200,924 !418,144 !38,348 i

2,358,130

42,84019,171

1,646,405561,445

1,717,9 2,358,130

603,757 i100,457 :

332 !2,287,124 !

2,322 ,19,932 j

186,622 :

615,929312,920

1603,473,873

1,21721,220

497,752

42,84020,342 :

1,917,007:1,086,281 '

134,070 :

4,923,071

42,84021,453

2,729,3241,915,993

213,461

3,200,546 ! 4,923,071

Dec. 31,1918.

538,8084,764

543,572:1,254,599

7156,530,491

1,42937,159

569,060

8,937,025=

42,876-22,629

5,285,1823,291,924

294,414

8,937,025

Austro-Hunganan Bank.


! Dec. 31,: 1913.

Gold coins and gold in bars.Bills and foreign notesSilver and fractional coins..

Total.

251,42112,15652,989

316,566

Notes of the war loan banksDiscounted bills, warrants, etc 187,607Advances on securities ; 62.931Loans to Austrian Government -.Loans to Hungarian GovernmentOld Austrian debt j 12,156Treasury cer tincates:£5 Austrian Government..

Hungarian GovernmentSecurities ! 3,467Mortgages I 60,757Other assets I 27,823

Total 671,307

LIAIJIIJTIES.Capital stock ! 42,546Surplus j 6,515Notes in circulation i 505,212Scrip payable in 3 and 6 months (Kassenscheine) |Deposits in giro account and other demand liabilities | 34.119Mortgage bonds i 59* 106Other liabilities ! 23,809

Dec. 31,1914.

, 213,757••"• 2 , 8 5 4

T | 25,454

242,065

y 415,999887,769

12,156

9,89360;53726.343

1/463, 770

42,5467.020

0i0;694

Dec. 31.1915.

138,75812,15613,387

164,301• =

24,567603,091667,18879,24847,43312,156

10,12460.14442', 880

1,711,132

Dec. 31,1916.

58,7591,14311,851

71,753

24,189578,771694,552745,216328,50212,156

10,33160,58758,598

2,584,655

42,546 42,5467, 696 8,291

1.451,093 i 2,206,033

289,12658,495

55,27157.90596,621

Total I 671,307 j 1,463,770 j 1.711,132

Dec. 31,1917.

53,71712,15611,443

77,316

21,722571,746694,738

1,932,804842,41112,156

10,3f>659,110

205,948

4,428.307

42,5468, 54.8

3,735.882

88.10358, 121183,561

2,584,655 j 4,428,307

396. 76255; S6fi188,603

Dec. 31,1918.

53,0744,82611,524:

69,424

, 8584,13S

1,691,5124,464,0881,830,694

12,156

955,879547,075.2,53357,410253,474

10,558,856

42,5468,509

7,210,2531,502:9541,446', 806

54,512293,276

10,558,856



ABSTRACT OF CONDITION OF MEMBER BANKS.

Abstract of reports of condition of member State banks and trust companies in each Federal Reserve district on Dec. 31,1918.

[In thousands of dollars, i. e., 000 omittcd.j

BESOUECES.

Loans and discountsOverdraftsCustomers' liability under letters of creditCustomers' liability account of acceptancesLiberty bondsOther United States bonds (exclusive of United States bonds

borrowed)United States certificates of indebtednessWar savings and thrift stamps actually owned !Stock of Federal Reserve Bank jOther bonds, stocks, etc. (exclusive of securities borrowed). .|Banking house iOther real estate owned iFurniture and fixtures |"Due from banks and bankers IExchanges for clearing house, also checks on banks in same

place..Outside checks and other cash itemsGold coin and certificates !All other cash in vault !Lawful reserve with Federal Reserve I*auk |Items with Federal Reserve Bank in process of collection |Interest earned but not collected '. |Other assets j

Total I

LIABILITIES.

Capital stock paid inSurplus fund —Undivided profits, less expenses and taxes oaidInterest and discount collected but not earnedAmount reserved for taxes accruedAmount reserved for interest accrued ,Due to Federal Reserve BankDue to banks and bankersDemand depositsTime depositsUnited States depositsBills oayable with Federal Reserve BankBills payable other than with Federal Reserve BankCash letters of credit and travelers' checks outstandingAcceptances '.Other liabilities

Total.

Liability for rediscounts, including those with Federal Re-serve Bank

District DistrictNo. 1 (31 No. 2 (101banks). I banks).

325,927288

313,26813, J.72

7235,299

1221,694

85,5018,528

241390 |

32,111 j

17,085 I2,316 !

1,84914,76834,4507,038527

4,987

599,596

1,581,254650

3,714115,182177,024

455123,837

2438,237

494,68241,4636,319673

251,613

231,60212,75311,98543,258270,61228,18913,43971,429

3,488,611

DistrictNo. 3 (29banks).

133,162102

72216,862

512,882

281,99596,3466,9462,805340

14,670

3,975456373

5,768 !16,424 !3,320 '


7366,491

285,77615695

6,46427,525

91525,897

1512,708

145,43713,2404,332920

33,686

7,3531,019404

11,34724,2413,124805

1,693

324,408 j 597,288

27,075 |30,581 |7,856 j1,152 •1,648 [

1,476275

18,091385,16485,0268,66711,607

94365

14,1955,175

599,596

19,122

118,371 ;159,121 !37,277 •4,676 i6,599 i5,014 (655 '

392,7512,129,633216,82297,159168,0584,8137,006

120,00320,593 :

21,302 I45,286

125,163

31.64559j 21210,346

378950362

113,255199,604234,3208,15828,, 087

63089

6,1834,068

597,288

3,823


63,806

1,0266,399

4,61833

47111,1741,754758188

887306119

3,0454,70938610

592

110,430

9,3816,6212,045181551494

7,12549,20326,1821,9435,0911,130

1,001319

110,430

1,472


119,44955642 i

7,88314,887

712,407

90791

17,3796,6292,218534

3,108486

6,91213,6312,268255

2,191

249,532

15,84010,5842,02032726822219

30,347115,23543,3295,03015,746

931421

7,9951,218

249,532

19,785


709,835362

7,7*513,70874,527

1,58274,313

6734,090

181,59315,0561,9062,20693,387

29,70111,0213,121

33.84275; 1887,608928

21,335

1,363,695

72,62066,20715,834

6644,071830122

74,674497,032536,78625,63540,5S52,2267,71515,1423,552

1,363,695

20,612



A bstract of reports of condition of member State banks and trust companies in each Federal Reserve district on Dec. 31,.1918—Continued.

[In thousands of doilais, i. e. GOO omitted.]

District j .uistrictNo. 8(44 I No. 9 (70banks). ! banks).

RESOURCES. |

Loans and discounts !Overdrafts \Customers' liability under letters of credit |Customers' liability account of acceptances iLiberty bonds iOther United States bonds (exclusive of United States bonds borrowed). |United States certificates of indebtedness iWar savings and thrift stamps actually owned jStock of Federal Reserve Bank ' iOther bonds, stocks, etc. (exclusive of securities borrowed)Banking houseOther real estate ownedFurniture and fixturesDue from banks and bankersExchanges for clearing house, also checks on banks in same placeOutside checks and other cash itemsGold coin and certificatesAll other cash in vaultLawful reserve with Federal Reserve BankItems with Federal Reserve Bank in process of collectionInterest earned but not collected .*Other assets

Total.

LIAE1TLITIES.

Capital stock paid inSurplus fundUndivided profit?, less expenses and taxes paidInterest and discount collected but not earnedAmount reserved for taxes accruedAmount reserved for interest accruedDue i o Federal Reserve BankDue to banks and bankersDemand depositsTime depositsUnited Stales depositsBill? payable with Federal Reserve BankBills payable other than with Federal Reserve Bank. . .Cash letters of credit and travelers' checks outstanding -AcceptancesOther liabilities

182,074417510

8,64227,635

1415,772

1001,318

34,5485,680

838703

27,7825,8011,7951,0145,523

15,7616,366

1475,243

347,683

Total

Liability for rediscounts, including those with Federal Reserve Bank. . .j

20,1455,311

264277344

36,757131,53575,5755,312

33,2081,208

5118,6424,769

347,683

50,75897

132,475

1993,940

43244

4,488873218290

11,185783344151

1,7013,673

17187

128

81,861

1,9701,218

757872

13,14827,43229,659

820701374

District i District ! DistrictNo. 10 (27 . No. 11 (97 j No. 12 (86

; banks). ! banks).

TotalUnited

, States1(930 banks).

51,285108

7410

3,627170

2,44544

25410,755

920126135

15,3731,4811,034180

1,7614,9441,523

36,585207

214 i

237 i3,567 !411 i

1,237 I74262 j716

1,196 !450 i428 !

6,224578371112

1,822 •2,731 !364 i14 |670 j

90,767297494

1,1587,345

539,330113481

14,9782,7651,835596

16,4672,093872635

3,8478,2171,141222253

96,796

5,2653,22466919598136

13!12 !

17,24646,02620,020

9631,8196444

41077

58,254 I 163,959

6,8232,26046513672429

3,38833,9936,006377

2,1002,530

181

81,861 ! 96,796 58,254

10,726 407 | 416 2,423

11,6744,4692,1811421871314

14,230 j63,62458,5481,7103,6101,643524

1,157125

163,959

3,630,6783,38112,959168.713375,0453,883

321,9771,714

22,5451,097,597105,05022,0467,401

543,316307,91835,39520,428133,592474,57961,49817,170115,226

7,482,113

350,110409,68093,3158,11115,0079,1561,109

628,1393,851,9701,361,020160,464342,00918,96316,335175,52341,202

7,482,113

2,151 228,044


298 FEDERAL RESERVE BULLETIN. MARCH 1, 1919.

Abstract of reports of condition of member State banks and trust companies of the Federal Reserve System on Dec. 31,1918,arranged by classes.


RESOURCES.

Loans and discountsOverdraftsCustomers' liability under letters of creditCustomers' liability account of acceptancesLiberty bondsOther United States bonds (exclusive of United States bonds borrowed).United States certificates of indebtednessWar savings and thrift stamps actually ownedStock of Federal .Reserve BankOther bonds, stocks, etc. (exclusive of securities borrowed)Banking houseOther real estate ownedFurniture and fixturesDue from banks and bankers..Exchanges for clearing house, also chocks on banks in same place..Outside checks and other cash itemsGold coin and certificates..All other cash in vaultLawful reserve with Federal Reserve BankItems with Federal Reserve Bank in process of collection.Interest earned but not collected 'Other assets

Total.,

LIABILITIES.Capital stock' paid inSurplus fundUndivided profits less expenses and taxes paidInterest and discount collected but not earnedAmount reserved for taxes accruedAmount, reserved for interest accruedDuo to Federal Reserve BankDue to banks and bankersDemand depositsTime depositsUnited States deposits ,Bills payable with Federal Reserve BankBills payable other than with Federal Reserve Bank...Cash letters of credit and travelers' checks outstanding.AcceptancesOther liabilities

i

Central re-i Other re- j (i.nnn+nserve city i serve city j ^r'zr*,JUbanks (54 | banks (140 | b a n k ? <?banks). I banks).

1,813,458713

11,826134,327178,698 i

127130,169

10710,120498,39539,958 j5.545 1719 I

284,833 i251,544 !16,934 !13,893 I47,741 i

304,440 I33,570 |12,069 !72,863 j

1,031,5021,3511,120

31,64197,2641,327

116,598423

7,828352,85140,52211,6712,597

146,22545,01012,6363,03243;256108,82420,6713,04936,612

785,7181,319

132,74599,0832,42975,2101,1844,597

246,35124,5704,8304,085

112,25811,3645,8253,50342,59561,31.57,2572,0525,751

3,862,049 i

140,791199,12240,2124,7899,9345,174393

438,336!, 260,166313,322102,312172,422

2,116,010 I 1,504,054

15,118 I140,71119,247

Total I 3,862,049

Liability for rediscounts, including those with Federal Reserve BankRatio of reserve with Federal Reserve Bank to not deposit liability (per cent)

138,98213.1

111,722151,35929,5492,3523,7661,986

95130,841934,269549,52134,978

108,4426,6851,208

32,29016,947

97,59759,19923,554

9701,3071,996

62158,962

657,535498,17723,17461,14512,278

92,5225; 008

2,116,010 1,504,054

59,802 I10.0

29,2607.0

TotalUnited

banks),Dec. 31,

1918.

3,630,6783,383

12,959168,713375,045

3,883321,977

1,71422,545

1,097,597105,05022.0467; 401

543,316307,91835,39520,428

133,592474,57961,49817,170

115.226

7,482,113

350,110409,68093,3158,111

15,0079,1561,109

628,1393,851,9701,361,020

160,464342,00918,96316,335

175,52341,202

7,482,113

228,04411.0

TotalUnited

States (847banks),Nov. 1,

1918.

3,664,0493,357

31,798168,937

1 386,049266,899

1,91122,317

1.067,650100,78822,1497,097

504,539191,62030,42621,901

106,138420,44346,32612,792

7,144,076

335,196394,106104,480

6,52412,77916,045

806544,387

3,379,0731,278,948

572,618222,82423,95618,969

189,10444,261


MARCH 1, 1919. FEDERAL, RESERVE BULLETIN. 299

Abstract of reports of condition of all member banks of the Federal Reserve system on Dec. 81, 1918, arranged by classes(including 7,762 national banks and 980 Stale banks and trust companies).


RESOURCES.Loans and discountsOverdraftsCustomers' liability under letters of creditCustomers' liability account of acceptancesLiberty bonds...."United States securities (exclusive of United States securities borrowed)War savings and thrift stamps actually owned IStock of Federal Reserve Bank iOther bonds, stocks, etc. (exclusive of securities borrowed)Banking houseOther real estate ownedFurniture and fixturesDue from banks and bankers.Exchanges for clearing house, also checks on banks in same place..Outside checks and other cash itemsCash in vault.Lawful reserve with Federal Reserve BankItems with Federal Reserve Bank in process of collection..Due from United States TreasurerInterest earned but not; collectedOther assets

Total.

LIABILITIES.Capital stock r)aid inSurplus fund/.Undivided profits, less expenses and taxes paidInterest and discount collected but not earnedAmount reserved for taxes accruedAmount reserved for interest accruedDue to Federal Reserve BankDue to banks and bankersDemand depositsTime deposits .United States depositsBills payable with Federal Reserve BankBills payable other than with Federal Reserve Bank. . .Cash letters of credit and travelers checks outstanding..AcceptancesNational-bank notes outstandingOther liabilities ,

Total.

Liabilities for rediscounts, including those with Federal Reserve BankRatio of reserve with Federal Reserve Bank to net deposit liability (per cent)

Centralreserve

city banks(101 banks).

4,595,2321,740

14,147290,593418,069476,580

24121,814

•805,17579,2737,5181.321

488', 086880,00335,897

173,654775,958128,324

5,60220,93488,918

19,059

327,541405,692125,15520,69431,4387,2331,240

,858,018,041,602423,642192,848456.831

'53024,971

303,12248.84239; 360

!

Other jreserve {

city banks !

(506 banks).!

Countrybanks"(8,085

banks).

TotaliJnitedStates

4,099,0683,426 !

11,360 :

150,586446,941519,620

1,51924,862

761,364 1133,609 i25,022 i7,976

780,612252,57437,595

199,033 !452,116186,986 !15,362 j10,62639,345 I

4,851,68011.183

' G5619,036

723,415879,580

6,44933,969-

1,248,618173,97834,51832,604 1

925,09461,54533,184 j

302,493426,66832,57224,60520,4207,532

banks),Dec. 31.

1918. '

13.545,96916,34926.163

460,2151,588,4251,875,780

8,20980,645

2.815,157'386,860

87,05841,901

2,193,7721,194,122

106,676675,180

1,654,742347,88245,56951,980

135,795

TotalUnitedStates(8,596

banks),Nov. l,

1918.'

13,758,06120,16344,361488,530

3,579,260

12,08079,744

2,760,037382,70768,89441,733

2,035,664793,70394,424571,090

1,519,651306,75139,16025,76991,177

8,159,602 9,849,779 27,318,440

433,920400,697111,93319,56015,0354,7252,434

1,506,2963,670,680979,148159,888417,95819,21612,176157,192173,485 I75,259

697.634448; 146194,69416,733 !8,632 '9,1516.346

429,7414,597.0212,43i; 530118,896284,48460.781

'87420,310453,98472;822

1,459,0951,254,535431,78256,98753,10521,10910,020

3,794,05513,309,3033,834j320471,632

1,159,27380,527 I38,021480,624676,311187,741 j

26,712,959

1,442,2061,223,342'482,21734,38744,30330,39010,882

3.435,05312.016,3103)650,9431,707,6271,081,956102,66142,608521,823675,16521i;086

9,309,059 I 9,849,779 j 27,318,440 I 26,712,959

237,437 j13.5

280,907 I

io.3 I211,707 i 730,051 i

10.4 !847,938

10.4


300 FEDERAL RESERVE BULLETIN. MARCH 1,1.919.

Abstract of reports of condition of all member banks in each Federal Reserve district on Dec. 31,1918 {including 7,762 nationalbanks and 930 State banks and trust companies).


RESOURCES.

"Loans and discount? ,OverdraftsCustomers' liability under letters oi" creditCustomers' liability account of acceptancesI liberty bondsOther 'United States securities (exclusive of United States

securities borrowed)War savings arid thrift stamps actually ownedStock of Federal Reserve BankOther bonds, stocks, etc. (exclusive of securities borrowed)..Banking houseOther real estate ownedFurniture and fixturesDue from banks and bankersExchanges for clearing house, also checks on banks in same

placeOutside checks and other cash itemsCash in vaultLawful reserve with Federal Reserve BankItems with Federal Reserve Bank in process of collectionDue from United States TreasurerInterest earned but not collectedOther assets


1,022,01368248

56,47676,377

134,715392

6,692222,16029,3841,3281,778

126,754

DistrictNo. 2 (723

banks).

57,0708,671 |

52,179 j101,612 i26,267 i3,114 j2,566 I6,736 i

4,315,7691,7755,940

236,349512,038

522,550717

20,807999,02684,61910,6103,512

403,009

825,77034,079

169,508708,515109,058

6,94024,19686,102

Total 1,937,914

LIABILITIES.

Capital stock paid inSurplus fundUndivided profits, less expenses and tax* tInterest and discount collected but not earnedAmount reserved for taxes accruedAmount reserved for interest accruedDue to Federal Reserve BankDue to banks and bankersDemand depositsTime depositsUnited States depositsBills payable with Federal Reserve BankBills payable other than with Federal Reserve BankCash letters of credit and travelers' checks outstandingAcceptancesNational bank notes outstandingOther liabilities

Total.

120,332105,17343,0715,3973,6442,302

625139,383

1,092,569216,078

52,1443,147280

61,51150,6549,276

1,937,914

Liabilities for rediscounts, including those with Federal Re- ;serve Bank i 148,241

9,080,889

315,770379,565136,71617 70623,3447,8364,586

1,482,3915,045,425

562,115191,206501,142

8,46716,195

246,81287,92053,693

9,080,889

236,111

DistrictNo. 3 (661

banks).


860,729304300

19,305172,712

108,158432

7,463371,64931,1766,2443,126

114,334

51,3774,31454,35897,86736,5874,4442,8776,811

1,954,567

98,028151,31236,3893,8282,6711,323161

186,811901,715285,17125,644162,1163 458340

20,83254,38620,382

1,954,567

30,290

1,165,551946

1,61221,161165,816

173,775968

9,073395,76253,60210,6143,827

203,704

36,5434)20376,142126,32840,7527,3874,4172,059

2,504,242


626,7411,213

1113,31597,137

98,977550

4,05784,15524,4753,0072,694

101,840

21,4464,89839,80756,68723,0243,3621,0231,021

1,209,440


478,1501,729519

14,97872,058

98,673'4583,187

46,69819,5705,3812,782

111,923

16,3907,28130,76546,87910,6412,169851

2,465

DistrictNo. 7(1,334

banks).

1,993,1971 9908,10048,357205,508

268,9251,73411,194351,52149,8617,1816,564

364,812

87,11917,665111,320224,87834,0335,4425,51522,965

973,547 I 3,827,881

155,246150,421

4,1833,4781,584457

258,9221,090,512552,99732,32678,2023,6481,70220,99889,74112,236

2,504,242

39,507

82,28655,38216.3193', 716 j1,147 !1,4772 556

136,133535,182216,75619,52859,4266,328

2113,91551,6237,645

1,209,440

33,231

65,676 i41,643 I11,904 j1,913 i824 !631 i294 !

107.867 I446;023152,915 !22,941 !54,624 !5,266 j540 !

15,213 !40,144 I5,129 I

221,753158,72452,3237,55510,2262,276468

553,0271,560,066920,70160,86089,5267,0008,94950,61978,84844,960

973,547 I 3,827,881

41,622 ! 64,091



Abstract of reports of condition of all member banks in each Federal Reserve district on Dec. $1,1918 {including 7,762 nationalbanks and 930 State banks and trust companies)—Continued.

[Ih thousands of dollars, i. e., 000 omitted.)

RESOURCES.

Loans and discountsOverdraftsCustomers' liability under letters of credit ,Customers' liability account of acceptancesLiberty bondsOther United States securities (exclusive of United States securities

borrowed)War savings and thrift stamps actually ownedStock of Federal Reserve BankOther bonds, stocks, etc. (exclusive of securities borrowed)Banking houseOther real estate ownedFurniture and fixturesDue from banks and bankersExchanges for clearing house, also checks on banks in same place iOutside checks and other cash items !

Cash in vault[.awful reserve with Federal Reserve BankItems with Federal Reserve Bank in process of collectionDue from United States TreasurerInterest earned but not collectedOther assets

Total

LIABILITIES.

Capital stock paid inSurplus fundUndivided profits, less expenses and taxes paidInterest and discount collected but not earnedAmount reserved for taxes accruedAmount reserved for interest accruedDue to Federal Reserve BankDue to banks and^bankersDemand depositsTime depositsUnited States depositsBills payable with Federal Reserve BankBills payable other than with Federal Reserve BankCash letters of credit and travelers' checks outstandingAcceptancesNational Bank notes outstandingOther liabilities

Total

Liabilities for rediscounts, including those with Federal Reserve Bank


558,238985

1,17121,82177,168

77,413607

3,79982,87319,044

2,364123,36418,8813,405

27,43653,65025,1872,0631,3615,605

1,109,117

District I District District ! DistrictNo. 9 (867 ! No. 10 (994 No. 11 (727 j No. 12 (644banks), j banks). I banks). banks).

— 1 _

564,1291,3221,0605,638

31,760 j

81,565504

2,93053,59815,6583,8542,943

160,24615,3144,624

23,41749,7413,2351,8403,030244

1,026,652

80,552 j46,857 i17,773 12,479 |1,184 !670 !3 !

185,779 i464,067162,22715,85550,5163,9691,188

22,00841,14012,850

1,109,117

23,398

65,06033,36316,4552,4682,1271,092

74175,062396,785277,46013,0613,8202,1121,0675,88729,4971,262

1,026,652

4,116

751,9522,214360

1,92963,295

87,567580

3,66073,69417,6973.6803,351

208,30224,6155,528

32,41670,08017,7522,3722,195343

I

1,

42,83816,6034,1701,472784620

646,691179,81323,55027,1479,162413

1,97546,6775,035

438,9101,719

94,37345,707

3,15414,49516,7454,4693,41477,9818,7296,056

20,95436 21712,4122,3901,0191 002

766,766

68,67337,98513,2342,1131,455289102

80,207396,37754,29810,55130,10020,185

614,22644,2032,707

1,373,582 i 766,766

32,538 41,618

769,6811,4707,03316,51368,849

157,073645

4,829119,52625,0298,0085,546

197,50330,8685,952

36,87882,2888,9344,0462,930442

1,553,843

105,48351,27223,4061,4591,53384574

202,077733,891253,78923,78250,5107,7857,26516,62861,47812,566

1,553,843

35,288

TotalUnitedStates

banks).

13,545,96016,34926,163

460,2151,588,425

1,875,7808,20980,645

2,815,157386,88067,05841,901

2,193,7721,194,122106,676675,180

1,654,742347,88245,56951,980135,795

27,318,440

1,459,0951,254,535431,78256,98753,10521,10910,020

3,794,05513,309,3033,834,320471,632

1,159,27380,52738,021480,624676,311187,741

27,318,440

730,051


INDEX.

Page.Acceptances:

Banks granted authority to accept up to 100per cent of capital and surplus 251

Schedule showing when proceeds of bankers'acceptances will be available if collectedthrough Federal Reserve Bank of New York. 245

Uniform acceptance collection scheduleadopted by all Federal Reserve Banks 246

Adelson, Louis C., appointed deputy governor ofFederal Reserve Bank of Atlanta 201

Amendments to Federal Reserve Act, as signedby President on March 3 228

Austro-Hungarian bank, statement showing con-dition of .. 197,295

Balance of trade, restoration of 194Bank of England, statement showing condition

of 197,294Bank of France, statement showing condition of. 197,294Bank transactions during February 258-260Biggs, David C, appointed governor of Federal

Reserve Bank of St. Louis 201Bills discounted during each month in 1918 by all

Federal Reserve Banks and by the Federal Re-serve Bank of New York . 276

Chart showing 277Business conditions:

Special report by Federal Reserve agents onbusiness readjustment in the UnitedStates : 205-217

Summary of reports by Federal Reserveagents 202-205

Certificates of indebtedness, issuance of, duringFebruary 189

Chart showing bills discounted during each monthin 1918 by all Federal Reserve Banks and bythe Federal Reserve Bank of New York 277

Charters issued to national banks during themonth 252

Check clearing and collection:Operation of system during the month 293Regulations adopted by New York Clearing

House Association regarding collections out-side of New York City, and rates to becharged 243-246

Uniform acceptance collection scheduleadopted by all Federal reserve banks: 246

Clearing-house bank debits to deposit accounts,weekly figures of 258-260

Commissioner of Internal Revenue, rulings of:Computation of discount and interest for taxa-

tion purposes 249Dividends declared for purpose of increasing

capital stock of a bank 256Comptroller of the Currency:

Instructions to national banks relative to report-ing "interest earned but not collected" and"interest collected but not earned" on callreport 249

Statement of, relative to condition of nationalbanks as at date of last call, December 31,1918 250

Page.Credit barometrics, report on, by Alexander Wall.229-243Department of Commerce, Industrial Board of,

formed to put into effect a plan for the readjust-ment of prices 196, 246

Discount and interest:Computation of, for taxation purposes 249Rates prevailing in various centers 265, 266

Discount operations of the Federal reserve banksduring January 276-281

Discount operations of the Federal reserve banksduring each month in 1918 276

Discount rates in effect 292Elliott, M. C., resignation of. as general counsel of

the Federal Reserve Board 201Failures, commercial, reported 252Federal Advisory Council:

Changes in personnel 200Meeting of 200

Federal Reserve Act, amendments to, text of, assigned by the President March 3 228

Federal Reserve agent and governor of AtlantaFederal Reserve Bank, change in 201

Federal Reserve agents' fund, summary of transac-tions for three months ending February 20 275

Federal Reserve Banks:Discount operations of, during February. 198,276-281Discount operations of, during each month in

1918 276Resources and liabilities of 282-284

Federal Reserve note account of Federal ReserveBanks and agents 285

Fiduciary powers granted to national banks 251,252Foreign banks of issue, statement showing condition

of 197,294Foreign trade outlook 193German Reichsbank, statement showing condition

of 197,295Gidney, R. M., appointed manager of Federal Re-

serve branch bank at Buffalo 201Gold:

Imports and exports of.. .• 198,290International gold clearance fund, efforts of

International High Commission regardingestablishment of 198

Report of committee to Secretary of Treasuryrelative to conditions in the gold-mining in-dustry 248

Gold settlement fund transactions, three monthsending February 20 274-275

Governors of Federal Reserve Banks of St. Louisand Atlanta appointed 201

Harrison, George L., appointed general counsel ofFederal Reserve Board 201

Index of wholesale prices 261-264Industrial Board of Department of Commerce formed

to put into effect a plan for the readjustment ofprices 196,246

Industrial readjustment during February 192International High Commission, efforts of, regarding

establishment of international gold clearancefund 198


II INDEX.

Interest and discount: Page.Computation of, for taxation purposes 249Rates prevailing in various centers 265-266Stable condition in rates 196

Labor:Readjustment of 192Unemi)loyment, estimate of amount of, through-

out the United States .".. 192Law department:

Bankers' acceptances against open accounts offoreign purchasers . 254

Domestic acceptances—security and limita-tions 254

Taxation of dividends declared to increasecapital—ruling of Commissioner of InternalRevenue 256

Liberty loan, fifth:Conditions under which loan is to be offered to

the public # 189Plan of financing, as submitted by Secretary of

the Treasury..'. 189Plan of financing as proposed by Ways and

Means Committee 190Statement of Secretary of Treasury before Ways

and Means Committee relative to 218-225Liberty Loan Act, Victory, text of 225Member banks:

Abstract of report of condition of State bankmembers 296-301

Statement showing condition of 199,287-289Money, stock of, in the United States 292National banks:

Charters issued to, during the month 252Fiduciary powers granted to 251, 252Instructions by Comptroller to, relative to re-

porting "interest earned but not collected"and "interest collected but not earned" oncall report .\ 249

Statement of condition of, as at last call ofComptroller, Dec. 31, 1918. 250

New York Clearing House Association, regulationsadopted by, regarding collections outside of NewYork City^ and rates to be charged. 243-246

Physical volume of trade 267-273Prices:

Downward tendency in February 195Index of wholesale /. 261-264

Prices—Continued. Page-Industrial Board of Department of Commerce to

formulate plan for the readjustment of.. . . 196,246Restoring of, to a stable basis 191

Resources and liabilities of the Federal ReserveBanks 282-284

Review of the month:Public financing in February 189The fifth Liberty loan 1 189The problem of business readjustment 191Labor readjustment 192Industrial readjustment 192Foreign trade outlook 193Restoration of balance of trade 194Price tendencies 195Industrial Board of the Department of Com-

merce 196Interest and discount rates 196Banking conditions abroad 197International High Commission's work in con-

nection with an international gold-clearancefund 198

Gold imports and exports 198Operations of the Federal Reserve banks 198Condition of member banks 199Meeting of the Federal Advisory Council 200Changes in personnel, Federal Reserve System. 200

Rulings of the Federal Reserve Board:Bankers' acceptances against open accounts of

foreign purchasers 253Domestic acceptances—Security and limita-

tions 253Section 22 of the Federal Reserve act 253

Secretary of Treasury, statement of, before Waysand Means Committee relative to the fifth Libertyloan 218-225

Silver, imports and exports of 290State banks and trust companies:

Admitted to system during the month 250Report of condition of 296-301

Tax rilling of Commissioner of Internal Revenuerelative to computation of discount and interest fortaxation purposes 249

Trade, physical volume of 267-273Wall, Alexander, report on credit baromotrics by. 229-243War Finance Corporation act, amendments to, as

passed by Congress 228Wholesale prices, index numbers of 261-264


Federal Reserve Bulletin March 1919

Documents

Transcript of Federal Reserve Bulletin March 1919