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September 25, I9I42 BOARD OF GOVERNORS DF THE FEDERAL RESERVE SYSTEM I. Public debt (Billions of dollars) Sept. 30, 19U2 90 Deo. 31, 19142 105 Dec. 31, 19U3 155 Dec. 31, 1914 205 Form F: R. 521 BOARD OF GOVERNORS II, OF THE FEDERAL RESERVE SYSTEM Bank takings (including Federal Reserve) A Last quarter 19k2 Range ] 3 9 9 Year I9I4.3 30 20 Year I9I1I4. 30 20 A, Assuming banks take 60 per cent of increase in total debt* B# Assuming banks take I. per cent 4O of increase in total debt. Form F.' R. j?21 BDARD OF GDVERNDRS III, OF THE FEDERAL RESERVE SYSTEM Assume public debt indicated and currencygrowth of U billions a year, amount of additional reserve funds that banks will need in addition to present excess reserves (depending on range above): Range A Last quarter of 19i|2 ... 0*7 Year I9U3 Year I9I4!* Total £ 0,7 • 8,U 6.7 8«U • •.. 17.5 6,7 l|. i.l If the demands were all met by open-market purchases - the portfolio would be at the end of I I . between 11 and 13 billions and 943 at the end of I I I . between 17 l/2 and 21 944 billions • Form F. R. 521 BOARD DF GDVERNDRS IV. DF THE FEDERAL RESERVE SYSTEM In absence of open-market operations this would require reduction of required reserves to an average of: Per cent of member bank deposits (adjusted demand plus time) JL Deceiver/19U2 December I9I4.3 . . . . • December 19i|i4. 16*7 8 2#5 16.7 9 3 (Existing requirements average about 20 per cent, minimum statutory requirements about 11 per cent) Form F: R. 521 BOARD DF GOVERNORS V. DF THE FEDERAL RESERVE SYSTEM If currency drain is met by open-market operations ( i . e . if t o t a l reserves are maintained a t 12 b i l l i o n dollars) r e quired reserves iwould have to be reduced to an average of 5 A Decenber I9J42 Decenber 19^3 December I9I4U • ] B 20 15 12 20 16.7 llj. In addition t h e portfolio would be a t the end of 191*2 - 5 b i l l i o n s 19U3 - 9 billions I9JUI4. - 13 b i l l i o n s