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ATLANTA AS THE Southeastern Center OF Commerce and Finance Briefs and Statistics presented to The National Organization Committee, Showing that Atknta is the natural site for a REGIONAL BANK ATLANTA CHAMBER OF COMMERCE 1914 ATLANTA AS THE Southeastern Center OF Commerce and Finance Briefs and Statistics presented to The National Organization Committee, Showing that Atlanta is the natural site for a REGIONAL BANK ATLANTA CHAMBER OF COMMERCE 1914 n, TIME FROM ATLANTA TO IMPORTANT CENTERS JQVTtf DAKOTA I MWA/£JOTA COMMERCIAL MAP OF THE SOUTHEASTERN REGION 5HOW1NG ATLAMT^d TRADE mEACH 5TATE NORTH CAROLINA CAROLINA t Q ©JACKSON MAP OF SOUTHEASTERN COTTON REGION GEOGRAPHICAL CENTER CENTER OF COTTON PRODUCTION For eword I N selecting Atlanta as a site for a Regional Bank to serve the Southeastern States, the National Government has recognized this city as the financial and commercial center of this section. The facts which led the National Organization Committee to select Atlanta are presented in the briefs which follow. These facts give some idea of the resources, development and progress of the Southeastern States and Atlanta's commerce in that region. They also show Atlanta's pre-eminence as a financial center. An interesting fact is that while the resources of this region are among the richest and most varied on the face of the earth and their product has more than doubled in ten years, the active capital available through the banks to handle these products and do the business of their teeming industries has trebled in volume while the products of industry doubled. Thus, the Southeastern district, already largely sufficient unto itself in finance as well as in industry, is rapidly becoming more so and its financial strength is increasing by leaps and bounds. The researches of the Atlanta Chamber of Commerce in preparing its brief for Atlanta show, by careful compilation, that more than half the merchants in the Southeastern States have bought goods in this market during the past five years. N o similar showing has been made m behalf of any other city. Facts like these are so valuable and significant that the Executive Committee of the Chamber of Commerce has provided for their publication. p age Five Foreword (Continued) The presentation of Atlanta's case was entrusted to a joint Committee from the Atlanta Chamber of Commerce and the Atlanta Clearing House Association, composed of the following gentlemen: J. K. On\ Chairman. W. J. Blalock, Jos. A. McCord, J. K. Ottley, J. W. Grant, A. P. Coles, R. F. Maddox, W. G. Cooper, Secretary. The movement to secure a Regional Bank for Atlanta was started in the Summer of 1913 by Mr. Wilmer L. Moore, then President of the Atlanta Chamber of Commerce, at whose instance the joint Committee was appointed. The work was completed during the administration of Mr. Mell R. Wilkinson in the Spring of 1914. For the success of their efforts the Committee, the community and the people of this section are largely indebted to Senator Hoke Smith, whose powerful influence was effectively exerted in behalf of Atlanta and the Southeastern Region. Page Six Introductory By / . A'. Orr, Chairman Joint Committee from the Chamber of Commerce and the Clearing House. O UR Committee desires to offer as part of our case all of the splendid testimony you have heard on yesterday concerning the resources, promise and possibilities of "these Southeastern States, which for the sake of brevity, we will hereafter refer to as T H E REGION. ' As you will sec by this blue print, it is composed of Tennessee, North and* South Carolina, Georgia, Alabama, Florida and Mississippi. We might speak of it as the heart of the Old South, once a dream of Empire, happily for our country and ourselves, a dream not written in the book of destiny. Out of the ashes of the past has come indeed a land of promise, its farmers growing richer every year. Its industrial independence well on the way. Its finance long in darkness, but now groping towards the dawn of a new day. We believe that day will be hastened by the new currency laws and greatly facilitated by the placing of one of the Regional Banks in some convenient center of this section. Let's start with agriculture. If it is true that the average rate of interest on farm loans made to the big insurance companies in the States of Illinois and Iowa is five per cent, and the same class of loans for the States in ?ur Region is six, this important industry has been carryln g a handicap of twenty per cent on its interest account. Listen to this juicy Bill of Fare, a monthly tonic to Ol *r financial intake. In January we have the citrus fruits of Florida; in February vegetables of South Georgia and Florida; Page Seven strawberries of March and April; June, peaches; July, watermelons; corn by the million bushels in August; September and October, cotton; November and December, more cotton. This takes no account of the minerals our friends from Alabama get out of the bowels of the earth. We hope to prove by competent witnesses that this Region in and of itself needs a Reserve Bank. We agree most heartily with a statement made, I think at St. Louis, that a Region should not of necessity be defined by the banking business heretofore done in that section by any center, but rather by the convenience and course of its commerce. The Region We expect to make our case upon the soundness of this principle. FIRST—As to the merits of the Region itself. It is one-half of the cotton belt. In population it is one-seventh of the United States. Its farm products equal one-ninth. Taken together on the average, one-eighth, so if only eight districts are named, our Region is qualified. The last census shows its manufactures are valued at 1,012 millions. Its crops 959 millions. Total of practically two billions. During these ten years it showed a gain of ioo per cent. We are not building for a day. A section showing this activity has possibilities beyond even a Georgian's imagination. While we are a large part of the cotton belt, we are by no means a one crop region. The next witness will show you we have a variety of products bringing in money every month in the year. We have every confidence that you will be able with the assistance of our witnesses to select some conveniently located central city that will be best able to serve this section as a whole. Page Eight Atlanta the Central City Lest they may overlook it, may I suggest one that within the Biblical term of the Span of one man's life, has grown from a modest hamlet to the metropolitan City that greets you today. Why is Atlanta? has never been answered. The Railroads first discovered it a good place to get across this peculiar angle of the Piedmont Escarpment. Then it became a trading center, later a good distributing point. This attracted factories, then Manufacturers' Agents. These made possible our great office buildings, one of which has come to be a part of our annual product. What is Atlanta's relation to the Region? "A City shall be known by its Commerce." Our next witness will tell you that about 90,000 merchants of these seven States are registered as customers of Atlanta, half of them in Georgia, 13,000 in Alabama, 10,000 in South Carolina, 6,800 in North Carolina, the remaining 15,000 in the other three States. Another witness will show we sell them 145 millions a year, and our manufacturers' agents sell 167 millions, making a total of Atlanta's trade in this territory 312 millions a year. Surely then a Reserve Bank here or hereabouts would do no violence to the convenience and customary course of trade. If 6,000 merchants of North Carolina and 10,000 in South Carolina are willing to trade with us, we hardly think they will refuse money from their local banks, because it happens to come through the Reserve Bank, if it should be located at Atlanta. We will offer the testimony of eight witnesses each more or less an expert in his line. The first of these is Mr. Wilmer L. Moore. Page Nine Atlanta The Site For A Regional Bank Statement on behalf of the Atlanta Chamber of Commerce prepared by Walter G. Cooper, Secretary. Summary of Atlanta's Case E present as one of the Regional Bank Districts, seven Southeastern States: The Carolinas, Georgia, Florida, Alabama, Mississippi and Tennessee. It is a harmonious, well balanced economic unit, with varied industries and a succession of crops and market periods following each other the year round. Its farm and factory products are about equal. The size and shape of the territory is such that its extremes may be reached in 12 to 15 hours from Atlanta, the geographic and commercial center. The average time of mail from Atlanta to a central point in each State is 8 hours and 47 minutes; from Richmond 18 hours and 38 minutes. The average distance from Atlanta of 210 railway common points in the seven States is 277 miles. These are all the competitive points in this territory. The capital and surplus of National Banks in this Region is 93 millions, giving a capital of $5,589,000 for a Regional Bank. The deposits are 262 millions, giving deposits of 13 millions for the bank. Half the State Banks would raise these figures to nine millions capital and twenty-two millions of deposits. The combined capital, surplus and deposits of State and National Banks is 850 millions. W Page Ten The Real Basis of Banking The real basis upon which the banking system must depend is the resources and productive power of the territory. That is the only sure reliance for the payment of commercial paper and the final redemption of your note issues. For that purpose this Region offers more than two billions of farm and factory products. Back of this are resources so vast and so varied that a Chinese wall round this territory would leave a selfsustaining nation complete in all the economic elements of civilization. These resources are being developed with such rapidity that the value of their products has doubled in ten years. The Region had a population in 1910 of 13J4 millions, but as only 28 per cent of the land is improved it is clear that several times that number could live in comfort in these States. The same area in Europe sustains n o millions. As for the center we suggest Atlanta because it has a great commerce highly developed in this region, it is the most convenient and accessible point and it has a far better business equipment than any other City in the territory. More than half the merchants listed by Commercial Agencies for this region buy goods in Atlanta. Our manufacturers', jobbers' and manufacturers' agents doing business here, sell 360 millions a year in the District. The Currents of Trade There can be no doubt about the currents of trade in the Southeastern Territory. They flow into and out of Atlanta and there is no other City in the Region that even approximates its volume of business. This is shown clearly by the bank clearings, which far exceed those of any other City in this Region. It is upon commerce and industry that the banking business of a country rests and the banking business should follow the course of commerce. In proportion as it departs from the channels of trade and seeks other channels and other centers, it is an artificial and unscientific system that causes hardship and unnecessary expense. To illustrate, the express rates on currency into this territory are Page Eleven 50 per cent higher from Richmond than from Atlanta. The time of mails more than double. As your note issues are based upon the commercial paper arising from the needs of trade and industry and these are automatically adjusted to the productive power, which is also the purchasing power of the Region, your banking system should be closely adjusted to the same things and as closely as possible in touch with all parts of the producing region. This is the main object of the new law. Emancipate Productive Power It has been a general complaint that the producing sections were too much under the domination of the lending sections and to meet this objection and emancipate the productive power of the country you have devised a system whereby the producing sections can secure money, on the basis of their products and trade represented by com* mercial paper. The expansion and contraction of currency in proportion to the volume of actual production and distribution is the ideal process for maintaining a wholesome condition of trade and industry. If a producing region has currency issued on the basis of its products, it will not long be a borrowing section. Its resources will develop and accumulate capital rapidly and this is what the Southeast has been doing with great rapidity. Its products have doubled in ten years and Atlanta's banking business has increased five-fold in the same period. Our Richmond friends have tried hard to draw the Southeastern States away from Atlanta on the plea that Richmond is a lending City with more idle money than Atlanta and as a consequence a few millions more of deposits in her Banks. It is because we have a greater commerce, demanding the constant use of our available capital that we have less idle money in Bank. Atlanta's Money Active Atlanta's money is active money, far more active than thai of Richmond and New Orleans. This is shown by the fact that Atlanta's bank clearings for 1913 were more than twenty times the deposits of her banks at the October Page Twelve call, whereas those of Richmond were only nine times, and those of New Orleans only thirteen times the amount of the deposits. This is tantamount to saying that the efficiency of money in Atlanta is 50 per cent more than that of New Orleans and more than double that of Richmond. Atlanta is the Southern insurance center, the live stock center, fertilizer centei, automobile center, the center for this territory of railways, telegraphs, telephones, express, and many other agencies that go to complete the complicated machinery of civilization. These things come here because Atlanta is the geographical, commercial and financial centei of the Southeast. They come here after the most careful investigation of the relative advantages of this and other centers. This is especially true of Manufacturers' Agents. They represent every important industry in the United States. A Great Business Center This business, amounting to more than 160 millions, is done here by concerns owned by non-residents, who have no sentimental interest in Atlanta. It is the cold calculation of self-interest that located their agencies here. The same economic law that brought them to Atlanta keeps them here and constantly adds to their number. There is no such group elsewhere in this Region. Cast your eye upon our warehouses and our office buildMgs and you can see it without computation. . Our local manufacturers, listed by the census as 548 m the county and making a great variety of articles, did ? business of 43 millions four years ago and were increasing then at the rate of 6 per cent a year*. They must now be turning out over 50 millions of products. ° u r postal receipts and parcels by post very much exceed those of any other City in the South, not excepting Louisville and New Orleans. The railways made their headquarters here for the territory between the Ohio, Potomac and Mississippi ^vers. These railroads are not owned or controlled in Atlanta. They put their headquarters here for the simple re ason that Atlanta is the center of their business, and P Thirteen when you come to think of it, their business is everybody's business. Railroads, Telegraphs and Telephones The same thing is true of telegraphs, telephones and express business. The relation of this territory and its center to others is shown by the fact that if you draw circles of 300 miles radius around New York, Chicago, St. Louis, Washington and Atlanta, you cover practically all the territory East of the Mississippi River and several States West of it. Within ten to fifteen hours all that territory can be reached from these cities. Thus Atlanta takes its place with other recognized centers in a complete system of Reserve Banks completely covering the territory East of the Mississippi River. Our bankers will discuss the relations of the banking business to the cotton crop of this region and the relation of cotton and other products originating in this region to foreign exchange. These are subjects of tremendous importance, for, as cotton is largely bought with currency in the primary markets, your Bank should be so located as to supply that currency quickly from the nearest center, which, for the Eastern half of the cotton region, is Atlanta. The value of cotton exported is about $600,000,000 and as cotton is the basis of more foreign exchange than any other single product of this country and does more to maintain the favorable trade balance than any other item, it is important to do that business with the utmost dispatch and with the least expenditure of money. Our bankers will show what a heavy economic loss to the country is entailed by the present indirect methods which have been fastened on us by obsolete custom. This burden your new system is well calculated to remove. The Southeastern Region Its Productive Power and Rapid Development The Southeastern District grows more than half the cotton crop. In 1913 its product was yy2 million bales, valued by the Agricultural Department at 457 millions, and a little more than half this cotton went to market Page Fourteen through the Ports of this Region, mostly through Savannah, Brunswick, Charleston and Wilmington. The local cotton markets of this region can be reached from the center in nearly every case within 15 hours. The average time is gl/2 hours to 23 principal points. There are 210 railway common points and the average distance from Atlanta is 277 miles. Cotton is by no means the only crop. It is less than half the farm product and corn alone brought 302 million dollars in 1913, according to the Agricultural Department. Resources The productive power of this region, measured by the value of its output, more than doubled in ten years between the census of 1900 and 1910. Its resources are indicated by these figures taken from the census and government reports, excepting State Bank returns, which were furnished by State Officers: AREA—332,149 square miles. One-ninth of the United States. POPULATION—13,203,423. One-seventh of the United States. FARM PRODUCTS—$1,114,200,734. One-seventh of the Cnited States. FACTORY PRODUCTS—$ 1,012,379,000. One-twentieth of the United States. Cotton Crop, 1913—Bales, 7,518,000—Value $457,834,ooo Corn Crop, 1913—Bushels, 353,977,000—Value... 302,318,000 Hay, Oats, Wheat and Potatoes, 1913—Value 99,399,ooo Total Six Crops $S59,55i,ooo To these must be added animal, dairy and poultry products, small crops, fruits and vegetables, which are not reported for 1913, but will turn out about $300,000,000. Banking Power The banking power of this territory is furnished by 3,103 banks, 522 National and 2,583 State, with capital, surplus and deposits as follows: BANKING P*OWER OF THE SOUTHEASTERN DISTRICT Capital and Number Surplus Deposits Total National Banks 522 $94,7*1,553 $2*4,138,6*9 $358,900,182 State Banks 2583 131,305,557 3^,819,564 494**35,12' ^5 p ags Fifteen $226,067,110 $626,058,193 $853,O35,3<>3 NATIONAL BANKS IN PROPOSED SOUTHEASTERN DISTRICT OCTOBER ji, 1913 North Carolina South Carolina Georgia Florida Alabama Tennessee Mississippi Number Capital Surplus Deposit** 72 $8,460,000 $2,359,525 $35*619.75' 48 6,365,000 2,151,400 21,724,859 117 15,168,500 9,333,000 52,295,249 53 7,505,000 3,087,677 33,104,644 90 10,180,293 5*851,293 43,555,062 109 13,217,500 5,552,655 62,895,220 33 3,385,000 1,644,653 14,643,356 522 $64,281,290 $30,480,263 $264,138,629 30,480,263 $94,76x,553 STATE BANKS—OCTOBER 21, 1913 Number Capital Surplus Deposits North Carolina ..412 $11,018,271.87 $3,016,348.93 $65,337,481.97 South Carolina ..322 12,778,000.00 4,621,000.00 51,000,000.00 •Georgia 697 28,859,513-67 16,514,360.65 91,441,535.27 Florida 189 6,427,220.00 3,061,665.60 27,542,385.97 Alabama 258 12,800,000.00 6,800,000.00 52,500,000.00 Mississippi 295 10,341,696.55 2,356,812.52 38,860,727.59 Tennev.ee 410 9t380.258.79 3,294,409.88 36,i37,434-i6 2583 $91,640,960.00 $39,664,597.00 $362,819,564.00 39*664,597.00 $3,3 •June 4, 1913. This information is compiled from returns for October 21st, 1913, with the exception of State Banks in Tennessee and Mississippi, whose returns date June 4th, 1913. Productive Power Doubledgin Ten Years The rate of progress in this Region is indicated by these figures from the census and United States Agricultural Department: INCREASE OF POPULATION United States Census North Carolina South Carolina Georgia *'1orLlda Alabama Mississippi Tennessee TotaI :*.... -. 1910 2,206,287 1,515,400 2,609,121 752,6i9 2,138,093 i,797,"4 2,184,789 ^3,203,423 1900 1,983,810 1,340,316 2,216,331 528,542 1,828,697 1,551,270 2,020,616 ",469,582 Page Sixt^n INCREASE OF MANUFACTURES United States Cen&us North Carolina South C arohna Ui6t6tf£oo 113,236,000 iZW* 202,863,000 Alabama MiSM^ippt 1 ennes-ce 145,962,000 Sof555,ooo 180,217,000 53,336,ooo 94,532,000 34,184,000 72,110,000 33,7*S,ooo 92,749,000 $1,012,379,000 $465,903,000 INCREASE OF CROPS United States Censu* 1909 $142,890,192 141,983,354 226,595,436 36,141,894 141,287,347 147,315,621 120,706,2x1 1899 $68,624,912 58,890,413 86,345,343 $959,920,055 North Carolina South Carolina k*°njia *[, ? l l a Alabama Mississippi Tennessee $456,178,986 88 73,190,720 84,883,776 70,745,242 These figures do not include animal industries or dairy and poultry products. Rapid Progress of Farming Within four years there has been tremendous progress by the farmers of this Region. The corn crop increased over 50 per cent and these States produced in 1913 oneseventh of the total crop, against one-eleventh in 1909. In those four years the average yield of corn per acre rose from 14.3 to 184 bushels. The increase by States and for seven States is here given : INCREASE OF THE CORN CROP United States Census and Department of Agriculture £orth Carolina South Carolina Gcorgia Florida Alabama Mississippi Tennessee Product in 1909 . . 34,063,531 . . 20,871,946 39,374,569 7,023,767 30695,737 28,628,667 67,682,489 Bushels 1913 55,282,000 38,512,000 63,023,000 10,125,000 55,360,000 63,000,000 63,00, 686 68,675,000 Crops of 7 States. .228,140,706 353,977»ooo Per acre 14.3 bu. Per acre 184 bu. r. o U * S. Crop 2,552,189,630 2,446,988,000 :*»age Seventeen Value of the Crop 1909 19x3 $48,648,000 '$31,286,102 20,682,632 37,357,000 57,531,000 37,o79,98i 5,709,009 8,302,000 28,677,032 49,270,000 48, s 10,000 26,030,376 52,880,000 45,3i9,O93 $195,284,225 $302,498,000 $1,438,553,919 $1,692,092,000 Sequence of Crops The fact that the use of money is distributed through the year by the maturing at different seasons of a series of crops is shown by these figures: (Prom the Census of 19x0 and Department of Agriculture Bulletin for 19x3 crop*) Citrus Crops of Florida, varying with season, 6 to 12 millions Vegetables, 7 States $40,360,578 Small Fruit*, 7 States'. 5,^76,637 Oats, 7 States 25,356,000 Wheat, 7 States 19,492,000 Potacoes, 7 States xo,oo3,ooo Orchard Fruits, 7 States x 3,970,501 Hay, 7 States 44,548,000 Corn, 7 States 302,3x8,000 Cotton, 7 States 457,834,000 To these are to be added the animal, dairy and poultry products, and small crops aggregating about $300,000,000. Economic * Gravity Forcing Men and Capital Southeastward The foregoing facts indicate the present status and past growth of the Southeastern District. As to the future, there is an economic gravity forcing men and money into this region from the territory North, East and West of it. The return to the farmer for his investment and labor are greater in the South Atlantic States than in any other part of the country. PROPORTION OF VALUE TO RETURNS New England Middle Atlantic E. North Central W. North Central South Atlantic E. South Central W. South Central Mountain Pacific Farm Value Average Crop Per Acre Value per Acre $43-99 $24.56 68.52 20.74 85.81 17.53 58.18 12.24 28.44 22.23 26.78 22.69 29.52 54.17 19.77 15-28 17.20 20.07 Per Cent. 56 3°*5 20.6 «•« 80 73 66.4 60 37 These facts show that the Southeast is pre-eminently the land of opportunity. Page Eighteen Eminent Authorities on the Southeast Concerning this and other resources, Dr. A. M. Soule, President of the Georgia State College of Agriculture, says: "This territory produces practically every crop useful for the nutrition and development of man in his highest perfection. Here indeed may the land owner sit under his own vine and fig bush and eat the luscious orange of the tropics surrounded by every comfort which a temperate clime affords. "There is resident in the heart of the hills the raw materials out of which great industries are developed, and thus agricultural and manufacturing enterprises can be carried on most economically and successfully, the one sustaining and fostering the other to the best possible advantage. Cheap power is to be derived from a thousand streams in their downward course to the sea. "In no other section of equal territorial area within the United States or any other part of the world, so far as is now known, can such a variety of useful crops and animals be produced with greater economy and under more favorable soil, climatic and economic conditions. The civilization of the Southeastern States is bound to exert a dominating influence on the history of the nation and of the world at large." Of the same region, Dr. W. S. McCallie, State Geologist of Georgia, says: "Within these States are to be found every variety of climate and soils met within the temperate zone, and a variety of mineral wealth nowhere to be surpassed in this country. It might be truly said of this Region that if surrounded by an impassible wall its people would find every condition at hand to enable them to live and prosper without any outside aid, whatsoever." Prof. N. S. Shalcr, in his famous book, "Nature and Jfan in America," has given this Southeastern Region the first rank in his summary of the elements which constitute f he physical basis of civilization on this continent. The same testimony has been given by other authorities of international reputation. Pa 8e Nineteen The area of these seven Southeastern States is approximately the same as that of Germany and the British Isles, which support n o millions of people, whose condition and vigor are the best in Europe. You are, therefore, dealing, not with the present status merely, but with a country whose resources will make it in a few decades one of the most populous and productive Regions on the face of the earth. Atlanta's Commerce in the Southeastern Region More Than Half the Merchants Trade Here. The extent of Atlanta's commerce in the seven States composing the Southeastern District is indicated by the fact that 88,742 merchants doing business in these States have bought goods in Atlanta during the past five years from a minority of our wholesale dealers. This fact is shown by the card index of the Atlanta Credit Men's Association, composed of merchants and manufacturers who have combined their information for mutual benefit. The ledgers of these firms and companies contain the names of 92,140 merchants, of whom 88,742 are located in the Southeastern District, distributed as follows; Georgia 43,300 Florida 6,853 l Alabama 3^(>7 Mississippi 5,614 Tennessee 2,623 South Carolina 10,380 North Carolina 6,805 88,742 This is certified to by the American Audit Company, who counted the cards in the Credit Men's index. This list contains an accumulation of four years, and in order to fully cover the business mortality of that period, we write off twenty per cent. As the number of failures reported by the Commercial Agencies for this territory during the past four years is less than four per cent, it will be seen that twenty per cent is a liberal allowance for the total of failures, retirements from business, changes of firm names, liquidated firms, etc. After taking off this allowance, we get the net list of Page Twenty merchants buying goods, and this we compare with the total^ number of merchants listed by Bradstreet's and Dun's Agencies at the latest report, placing the two side by side in parallel columns as follows: Merchants Buying Goods in Atlanta Merchants On Ledgers LiMed by R. G. Dun's 170 Firms Less Iiract>treet*$ Li*t of Atlanta 20 per cent Alabama 20,336 20,253 13,167 10,534 S,' e o r P l a 33.295 29,184 43,300 34,640 12 6 J | ? n . d a . ". » ^ «*,745 6,853 4,483 MisMVsippi . . . . 18,238 15,916 5,614 4,492 Tennessee 25,295 23,432 2,623 2,109 oouth Carolina.. 14,349 13,577 10,380 8,304 North Carolina. 23,604 23,817 6,805 5,444 147,727 138,924 88,742 70,006 Thus it appears that about half the merchants in the Southeastern District are customers of one-fifth of Atlanta's merchants, manufacturers and agents. Many more than this number could be shown if we had returns from all the merchants and manufacturers of Atlanta. Only 170 of these firms are represented in the card index of the Credit Men's Association, whereas there are 914 merchants, manufacturers and Manufacturers' Agents doing a wholesale business here. It will appear from this list that Atlanta sells in Georgia a few more merchants than the number in Bradstreet's hst. This need not cause surprise because neither Commercial Agency has an absolutely complete list. For example, R. G. Dun & Company report for Georgia 29,184 against 33,295 reported by Bradstreet's Agency, and a still larger number appear on the ledgers of Atlanta firms. The books of Atlanta wholesale dealers and manufacturers contain the names of many commissaries and contractors who do not appear in the lists of the commercial agencies. Volume of Atlanta's Trade in the Southeast In order to arrive at the volume of Atlanta's trade in the seven States of the Southeastern Region, letters were sent to merchants and manufacturers doing a wholesale business and to Manufacturers' Agents selling goods from Atlanta for non-resident manufacturers who were asked *Or the amount of business done by each concern in each ktt Pa ge Twenty-one Returns were received from a minority of those doing business in Atlanta and this is not surprising when it is remembered that the information sought is one of the secrets of business which men guard with the utmost care. There are in Atlanta 429 merchants and manufacturers doing a wholesale business here, and of these we have returns from 219, or 51 per cent. There are also in Atlanta 485 Manufacturers' Agents selling from here for non-resident concerns and we have returns from 150 or 31 per cent. These returns total $74,388,617 of sales by merchants and manufacturers and $51,784,151 by Manufacturers' Agents. Distribution by States The business of these concerns in the District is distributed as follows: Merchants and Manufacturers Georgia $44,502,336 Alabama 8,353,562 Florida 3,536,070 South Carolina. 4,218,523 North Carolina 2,583,5" Tennessee 3,068,805 Mississippi . . . 1,765,282 Undistributed . 6,378,528 Total 7 States.$74,388,617 Manufacturers* Agents $18,882,677 6,337,641 5,600,187 4,971,108 3,181,733 4,446,973 2,062,589 6,301,243 Total $63,385,013 14,673*203 <M3M57 9,189,631 5,765,244 7»5*S»778 3,827,871 12,679,771 $51,784,151 $126,172,768 The Business Indicated At the same average volume of business reported by these concerns, all those doing a wholesale business in the City would show the following total: Manufacturers and Jobbers. .$145,860,000 Manufacturers' Agents 167,045,600 $312,905,600 Distribution of Total by States This total, distributed among the States in the proportion of the sales actually returned, would give these totals for each State: Georgia Alabama Florida . . . . South Carolina North Carolina Tennessee Mississippi Undistributed indicated Total for 914 Concerns $158,000,000 36,000,000 23,000,000 23,000,000 14,000,000 19,000,000 9,000,000 31,000,000 $313,000,000 Page Twenty-tw0 Summary Summarizing these items of trade other than retail we find the figures to be as follows: Merchants and Manufacturers Manufacturers' Agent* Cotton Seed Products Fertilizers Not Included Above Horses, Mutes, Cattle and Hops Insurance Premium* $145,860,000 167,045,600 11,027,168 5,000,000 16,000,000 20,000,000 $364,932,768 As the total is less than half Atlanta's Bank Clearings, it is clear that the estimate is not exaggerated. Even the Bank Clearings of $725,000,000 do not measure the volume of business. They are only about onethird, for the total business done by the seven Clearing House Banks was $2,025,611,801.69" Railroads, Telegraphs and Telephones In addition to this is the vast volume of business transacted by Railroad Companies, Telegraph and Telephone Companies, Insurance and Express Companies, newspapers and publications. The combined circulation of Atlanta newspapers in the Southeast is about equal to the population of Atlanta. This mighty engine of development has no equal in the South. It is impossible to say what is the volume of railroad business done in Atlanta, for there are no separate statistics available, but the Georgia Railroad Commission reports the total amount of railroad earnings for this State as $5J>559,583.06 for the year ending June 30th, 1913: Telegraph and Expres* Companies Compress Companies Street Railway, Power and Light Companies Telephone Companies $i,9l6>7°5-°8 1,222,581.64 9»998>49°-37 3,164,212.74 The total earnings of all public utility corporations in Georgia during the fiscal year ending in 1912, as reported t0 the Railroad Commission, was $67,198,472- A l a r S e Part of this passed through the banks of Atlanta. Volume of Railroad Business Atlanta is the headquarters of the Southeastern / ight Association and the Southeastern Passenger Association, whose territory includes the States South of the °hio and Potomac East of the Mississippi. This inF e Pa 8« Twcnty-three eludes nearly all of groups 4 and 5 of the Interstate Commerce Commission, excepting West Virginia. For those groups the United States Bureau of Railway Economics gives the following figures: Group No. 4 West Virginia, Virginia, North Carolina, South Carolina, Group No. 5 Kentucky Tenne^ee Georgia Alabama Mississippi Florida MILEAGE OPERATED ALL TRACKS—55,425 miles. POPULATION—18,817,072. AREA—439,395 square miles. FREIGHT REVENUES—$ 166,352,819.00 NUMBER REVENUE PASSENGERS CARRIED—83,490,783. PASSENGER REVENUE—$72,459,675.00 Growth of Banking BANK CLEARINGS OF SOUTHERN CITIES (Financial Chronicle) New Orleans Atlanta Louisville Galveston Memphis Richmond Fort Worth Nashville Houston Savannah Norfolk Macon Jacksonville Birmingham Austin Chattanooga Charleston 1913 $930,683,873 725,604,193 715,731,886 519,101,000 421,987,372 419,121,313 418,619,830 366,657,389 357,821,194 280,538,332 214,966,911 190)313,093 174,97**596 173.857,773 131,608,482 128,745,099 101,660,117 Columbia 57,3*3,538 BANK CLEARINGS OF 20 YEARS (Furnished by Darwin G. Jones, Manager of The Atlanta Clearing Hou«e) 1893 $60,753,911.13 1894 56,589,228.04 ^95 65,318,254.71 1896 69,026,033.17 '897 72,005,161.52 1898 „ 71,964,809.03 8 •• 83,058,397-" 9,375,5 J 9Oi 1x1,755,849.98 X O2 9 131,200,457.25 *9O3 i44,992,O37-59 1934 158,022,303.15 1905 185,625,644.98 6 235,997,896.02 Page Twenty-fot»r *9<>7 1908 1909 1910 1911 1912 1913 254.965.803.94 230,067,592.55 406,049,538.55 574,164,916.77 653.I3O.42O-35 691,941,254.20 725,604,192.65 ATLANTA LEADS IX 1914 COMPARATIVE CLEARINGS FOR THE MONTH OF JANUARY, 1914 (Furnished by J. E. C. Pedder, Division Superintendent, Bradstreet's Agency) New Orleans 19*4 $in,974»545 New Orleans, 1913 103,412,499 Richmond, 1913 Richmond, 1914 $8,562,046 $39,524,158 38,735,909 Atlanta, 1914 Atlanta, 1913 $789,068 $78,93*.O54 68,563,168 $9,368,886 R A N K C L E A R I N G S FOR FIRST W E E K IN FEBRUARY, 1014 New Orleans Increase, 11.7% Atlanta Increase 23.2% Richmond Decrease .1 % Atlanta's Growth Atlanta's rapid growth is indicated by the following facts: . Atlanta's population increased from 89,832 to 154,839 m ten years, and is now (February, 1914) 190,000. Its bank clearings grew from $60,753,911 in 1893 to $725,604,192.65 in 1913. These are by far the largest in the territory, as shown by the following statistics for 1913 furnished by the New York Financial Chronicle: In the percentage of increase for the first week in February, Atlanta leads forty principal Cities in the United States with 23.2% increase. RATIO OF CLEARINGS TO DEPOSITS Clearings Clearings Deposits to Year 19*3 #v Oct. 21,1913 Atlanta 35.90 Birmingham 25.05 Macon 7.98 Savannah 22.11 Louisville 5*45 New Orleans . . . . 7518 Chattanooga 17.58 Knoxville "49 Nashville 24.12 Houston 38.51 Richmond 48.12 Charleston 19.82 Columbia not given. Montgomery not given. Twenty.five (000 Omitted) 75 6 i73» 8 57 9»33 280,538 I 7 5»73 X 980,685 125,745 87,812 366,657 357.821 4*9>X2X 101,660 Deposits 20.2 Times 6.9 23.8 12.7 13.9 X 37.1 7.6 152 9-3 8.7 Atlanta Leads in Post Office Receipts In Post Office receipts and outgoing packages by Parcels Rost, Atlanta exceeds any other City in the South, as will be seen by these figures: Atlanta New Orleans Louisville Richmond Memphis Nashville Birmingham Jacksonville Oklahoma City Total Receipts $1,328,011.24 1,182,761.72 1,163,598.18 828,81049 747,936-72 653,202.36 485,80148 5x1,186.68 377,007.68 Parcels Handled Out Going In Coming 77,693 32,605 47,163 33,838 43,014 27,048 37,154 20,627 25,631 13,694 20,179 15,281 37,237 65,072 9,681 9,750 13,083 9,3"> Page Twenty-si* Summary for Six States Supplementary Brief by Atlanta Chamber of Commerce S O U T H C A R O L I N A , Georgia, Florida, Alabama, Mississippi and Eastern and Middle Tennessee will furnish territory contributing, from the National Banks alone, more than sufficient capital to locate a Reserve Bank within this region. The States of this Region have, in their National Banks alone, the following capital, surplus and deposits: NATIONAL BANKS OF SIX SOUTHEASTERN STATES (Report for January 13, 1914) Capital Deposits of Indi- Subscription to and Surplus viduals and Banks Capital Stock Vf/B" $24,615,910 $63,893,15971 $1,476,954 Alabama 16,363,095 49,825,698.61 981,785 Tennessee (2/3) .12,893,709 53,429,342.31 773,622 Florida 9,9*o,977 40,645,806.39 594,658 South Carolina.. 8,734,750 29,593,800.07 524,085 Mississippi 5,165,204 i7,945,S93io 309,912 77,683,645 255,333,400.19 4,661,016 Georgia has largely more National Banking Capital than any other State in this Region and will, therefore, contribute more largely to the stock of the Reserve Bank. The exact amount is shown by the last column in the above table. The Cities of this territory have the following capital, surplus and deposits in their National Banks: RANK OF CITIES IN THE SOUTHEAST (National Banks Reporting January 13, 1914) Subscription to Capital Individual Capital Stock of and Surplus Deposits Regional Bank Atlanta $8,600,000 $24,531,575 $516,000 Louisville 8,280,000 20,740,875 496,800 New Orleans 6,730,000 19,406,054 403,800 Birmingham 3,300,000 9,934,98o 198,000 Chattanooga 2,975,000 10,173,426 178,500 Knoxvillc 2,490,000 8,668,792 i49,4oo Memphis 2,140,000 7,417,434 128,400 Savannah 1,600,000 1,369,221 96,000 Columhus 445,000 1,108,367 26,700 p *ge Twenty-seven Rapid Increase of Banking Power The Banking Power of these six States is now half the annual value of all their products. Value annual production farm and factory, i,4° 2 millions. Bank capital, surplus and deposits of State and National Banks, 731 millions. While the products have doubled in ten years the Banking Power has trebled: INCREASE OF BANKING POWER IN THE SOUTHEAST NATIONAL BANKS (From Comptroller's Report) National Banks only 1902 1912 1914 Georgia 6,854,000 $23,391,000 $24,615,910 South Carolina . . 2,731,000 7,903,000 8,734,750 Florida 2,302,000 10,176,000 9.9*0,977 Alabama 4,995,000 15,254,000 16,363,095 Mississippi 2,079,000 4,830,000 5,165,2.54 Tennes&ee ( 2 / 3 ) . . 5,990,000 11,809,332 12,893,709 24,951,000 $73,363,332 $77,683,645 Thus the Banking Power, already near equal in ratio to that of the United States, is increasing fifty per cent faster than the products. Banking Power Half the Annual Product Georgia is the largest State of the Union East of the Mississippi Riven When you combine agriculture, manufactures and commerce, Georgia far exceeds any State in the Southeastern Region and Atlanta not only leads the entire Southeastern Region, from Virginia to Texas in its contribution to the stock of the Reserve Bank, but under the terms of the Bill as to "convenience and ordinary course of business" its status entitles it to the Reserve Bank. As to convenience, 152 Passenger Trains come into or go out of Atlanta every day. Between the close of Banks one day and their opening on the next you can reach by train any part of the District. Atlanta is literally the gateway of the entire Southeast, even though you include Louisiana and North Carolina in that Region. Practically all the travel from Louisiana to New York goes through Atlanta. Page Twenty-eight Atlanta's Business in the Region Atlanta is the great market of the Southeastern Region and its commerce of 34c millions in the Southeastern States is not equaled or approached by any other City. Atlanta is headquarters for the insurance business of the entire South, being the fourth largest insurance center in the United States. Atlanta does one-fifth of the insurance business of the entire South and one-third of that in the Southeastern District. Atlanta is headquarters for Railroads, Telephone and Telegraph Companies and express business for the South. Atlanta is headquarters for the Southeastern Passenger Association, which extends from the Potomac and Ohio Rivers to the Mississippi. Atlanta is headquarters for the Southeastern Freight Association and the Southern Weighing and Inspection Bureau, covering the same territory. Atlanta is headquarters for the agents of all important manufacturers in the United States doing business in the South. Atlanta has been selected by the Federal Government as the center of the Southeast for its most important operations, including the Railway Mail Service, Military headquarters, the new Bureau of Commerce, being one °f the four branches of that Department for the United States, and the site also for the Federal Prison for the entire South. As further illustration of its convenience and advantage as a business center, Atlanta was selected by the Ford Automobile Manufacturing Company as a site for the on ly branch of that establishment in the South. Atlanta's pre-eminence for business in the SoutheastCr n States is further shown by the Post Office Receipts and parcels sent out by Post, exceeding those of any other CJ ty in the South. Growth of the Region and the City The growth of this entire Southeastern Region has ^cn phenomenal. Its development is more rapid than ftat of any other section of the United States, unless it be re *as and" Oklahoma, or a portion of the Pacific Coast. b Pa i c Twenty.ninc Georgia has made more progress in the last ten years than any State in the Southeast when you consider the combined growth of agriculture, manufactures and commerce. Atlanta's commerce in this Region exceeds that of any other City. So.-Eastern Banks Lend More Than They Borrow Borrowing by Banks in this Region from Banks in New York and other Cities during the crop season is largely offset by the balances which Southeastern Banks carry in New "fork and other Cities as Reserves and for exchange purposes. During most of the year other Regions are debtors to this Region when deposits are taken into consideration, and if interest were charged both ways at the same rate there would be a large balance of interest in favor of the Southeastern Banks. Borrowing From Outside Territory The National Banks in this Region lend to other banks in the Region far more money than they borrow from Banks outside the Region. This is shown by the following facts: ist. The larger banks lend to the small banks, and these again lend to still smaller banks, so that much of the amount borrowed during the cotton moving period by banks in Georgia is really triplicated so far as it indicates borrowing from outside the section. 2nd. The deposits outside the section by our existing Reserve System and the additional deposits carried in the large Cities for exchange purposes will average two-thirds as much as the actual money borrowed from those outside Cities during the cotton moving season and sent into this section 3rd. This money is not borrowed for the ordinary course of commerce, but to move the cotton crop and under the present system it requires several times longer to clear it than it would with a Reserve Bank located in this section. A large part of the cotton bought is exported and with a Re* Page Thirty serve Bank conveniently located in this cotton section, handling foreign exchange, the time would be so greatly reduced for the clearings that the actual money required would be much less and the convenience to the section much greater by locating a Reserve Bank near its center, in the largest cotton producing State East of the Mississippi River. Georgia comes next to Texas as a cotton producing State and the Region outlined produces about one-half the entire crop. Other States and Cities Favor Atlanta A large part of Florida, including eight of twelve Banks in Jacksonville, favor Atlanta. The Governor and his Cabinet indorsed Atlanta. Savannah asked that the Reserve Bank be located in Georgia, whether in Atlanta or Savannah. Mobile, after New Orleans, has asked to come to Atlanta. Montgomery, after herself, asked to come to Atlanta. Chattanooga, after herself, asked to come to Atlanta. The Knoxville Board of Commerce indorsed Atlanta as first choice. The President of the Mississippi Bankers' Association gave his evidence first for New Orleans and second for Atlanta. In the hearings throughout the United States Atlanta was named all over the country as a place at which a Reserve Bank should be located/and the thought of the enfire country indicates the necessity for a Reserve District J n the Southeastern section with Atlanta as its center and Sl *e for the Reserve Bank. Conclusion We present the largest State East of the Mississippi River, the largest City in the Southeast and the State and City which will put more money under the Law in the Reserve Bank than any others in this Region. In support of these statements, we ask reference to the Briefs filed by the Atlanta Committee, which support every claim we made and many more excellent claims not Mentioned in this brief statement. P *8« Thirty-one The Trend of Banking By J. K. Ottley, Vice-President Fourth National Bank and President Clearing House Section American Bankers Association. r p H E President of Princeton University (now PresiI dent of the United States) in an address before the American Bankers' Association at Denver in 1908 laid down the principle that all of the people of this country are entitled to equal banking facilities. The present Currency Law, with its provision for the establishment of Federal Reserve Banks, is the realization of what then seemed but an idle dream. The law undoubtedly contemplates giving to the people of ALL SECTIONS of the United States the largest possible benefits derivable from the operation of such Banks. This involves a distinctively territorial distribution of the centers; or, in other words, it necessitates such a division of the country into REGIONS, as will give each region an individual significance from a geographical standpoint. The indicated Region is then to be served by a RESERVE BANK located within its confines at such a point as will be proven both geographically central and commercially adequate. Let us consider, first, the division into REGIONS: I submit the proposition that a "Region," in order to secure the maximum advantage of the new system, should be territorially compact. If within such a region the natural resources are such as to make possible a diversity of activities—commercial, agricultural, mining and manufacturing—so much the better. Page Thirty-two GEOGRAPHICALLY, it appears logical that there should be created a SOUTH EASTERN REGIOX, to embrace, say, the seven States of North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi and Tennessee. It meets the desired requirements in point of geographical compactness and physical outline. It certainly is such an area as I have described in regard to its sources of wealth. It is an ideal illustration of a territory in which agricultural, mining, manufacturing and commercial interests flourish. Division of Territory May I call your attention to the fact that if only those Cities recognized under the old system as money centers be selected as Regional Bank Cities, the territorial division of the country unquestionably contemplated by the Law cannot be achieved? Would the spirit of the Act be realized by dividing the country into wedge-shaped slices running VERY THIX at the center? Would it not unquestionably further the intent of the Law to divide the country into solid, compact areas, each of these to be served by a Federal Reserve Bank? If so (and I assume that the logic of the claim is readily apparent) the creation of the SOUTHEASTERN REGION, composed of the seven States named, is a foregone conclusion. ATLANTA IS THE GEOGRAPHICAL CENTER of this Southeastern Region—a fact of which you have ocular demonstration. ATLANTA IS THE COMMERCIAL CENTER of the Southeastern Region—a statement I believe you will consider incontestable after hearing the evidence presented. A moment since I spoke of the resources of this Region. Commerce is inclined to follow natural laws. Banking follows Commerce. The barometer of banking is Clearings and it is with Atlanta's Bank Clearings I wish to engage your interested attention. The Bank Clearings of Atlanta for 1913 were $725,604,193, remarkable indeed for a City whose population, by the United States Census of 1910, was 154,893- T h e W Clearings are twelve times as large as those of 1893. Pa «e Thirty-three The following table shows the Clearings of leading Southern Cities, including Cities located in seven of the States mentioned as the SOUTHEASTERN REGION: BANK CLEARINGS OF THREE DECADES From Records of Commercial and Financial Chronicle % of Inc 1893 Atlanta . . . Galveston 145,404,778 Memphis . 84,962,497 Richmond 114,957,2x7 Fort Worth 28,7x4,3x0 Nashville Houston . . 134,774,530 95,639,437 Savannah Norfolk . . . 49,091,728 Macon . . . . Jacksonville. Birmingham 17)907,337 Chattanooga 16,003,120 Charleston . 1896 Knoxville . 21,500,000 Columbia . . 1903 144,992,037 220,266,000 214,009,558 208,177,595 124,589,656 348,464,433 195,926,562 40,782,000 26,112,7x7 63,146,885 37,102,107 58,500,000 1913 1903-191? 598,688,766* 3x2 5X9,xox,ooo 421,987,372 4x9,121,3x3 4x8,619,813 366,657,389 357,821,194 2x4,966,911 190,313,093 174,971,596 173,857,773 131,608,482 128,745,099 101,660,117 13S 07 xox 396 194 27 43 152 366 57O 175 247 87,800,000 *In the clearings of Atlanta for 1913 the mm of $126,915,426 has been deducted, representing country checks collected through Clearing House in order to make correct comparison. Volume of business done during the year 1913 by seven Clearing House Banks $2,025,611,801.69 Volume of business done during year 1909 by six Clearing House Banks 1,378,985,864.25 Increase in five years $646,625,937.44 Bradstreet reported Clearings, 1912-1913, decrease, N e w Orleans, 7.3%; Richmond, 24%; increase, Atlanta, 4.8%. Deposits Oct. 21,1913 (000 omitted) Atlanta $35,900 Birmingham 25,050 Savannah 22,110 Louisville 51,450 New Orleans . . . . 75,180 Chattanooga 17,580 Knoxville 11,490 Nashville 24,120 Houston 38,5x0 Richmond 48,120 Charleston 19,820 Clearings Year 19x3 (000 omitted) 725,604 173,857 280,538 715,731 980,683 "5,745 87,8x2 366,657 357,821 419,12* 101,660 Clearings to Deposits 20.2 Times 6.9 " X2.7 13.9 13. 7.t 7.6 15.2 " « " 9-3 8.7 5.1 " " Page Thirty^* PERCENTAGE OF RESERVES CARRIED BY NATIONAL BANKS OF ATLANTA IN THE FOLLOWING CITIES Per cent New York 56.1483 Boston 3.3983 Philadelphia . . . 4 1O.62 Chicago 7.79l Cincinnati 3.845 New Orleans 1.7666 Baltimore 6.3 Louisville 716 St. Louis 4.173 Pittshurg 1.3x6 Albany 95 Cleveland '. 366 Detroit 166 Indianapolis 216 Kansas City 6 v Washington ." 1.623 99.9952 FIGURES FOR ONE ATLANTA BANK, WHICH WILL BE TYPICAL OF BANK IN THE SOUTHEASTERN REGION Average 1913 Dailv Average Bills Payable $232,670.00 Due from Reserve Agents 459,320.00 Due from Eastern and Western Bank* 58,290.00 (Other than Reserve) Due from Other Banks 3S*>9$o-oo (Including Atlanta Clearing House) COMPARATIVE CLEAPINGS FOR MONTH OF JANUARY (Furnished by J. E. C. Pcdder, Division Superintendent, Bradstreet's Agency) New Orleans, 1914 $i»,974,545 New Orleans, 1913 103,412,499 (Jain Richmond, 1913 Richmond, 1914 $8,562,046 $39,524,158 3*>735,°9O Los5 Atlanta, 1914 Atlanta, i 9 I 3 $789,068 $7»,93i,°54 69,5*3,i*8 Gain $9,368,886 BANK CLEARINGS FOR FIRST WEEK IN FEBRUARY, 1914 New Orleans Increase 11.7% Atlanta Increase 23.2% Richmond Decrease .1% . In percentages of increase for first week in February, Atlanta leads forty pnncl Pal Cities in the United States with 23.27c increase. Clearing for Other Towns The commerce of Atlanta was of sufficient magnitude, 1 her mail facilities of such convenience, as to warrant -ur Clearing House in 1909 in adopting the plan o f ^ a r ln g direct the States of Georgia, Alabama and Florida, three of the States suggested as properly belonging ta this Region, which means that Atlanta deals direct with banks. Thirty-five Atlanta was the second City in this country to adopt the system of clearing country checks direct and today, with the exception of Boston, Atlanta has the most complete system of its kind. This organization and trained force would be at the disposal of a Federal Bank when needed to carry out this feature as contemplated in the Law. Business transacted with Augusta, Macon, Savannah, Birmingham, Montgomery and Anniston is handled in the usual way—on the reciprocal basis. All other cash items on towns in the three States are cleared direct, the 'amount being in 1913, $126,915,426.34. Deducting this amount leaves the sum of $598,688,766.31, a greater volume than that listed in any other Southeastern City. This sum is practically equal to the total Clearings of Columbia, Charleston, Chattanooga, Birmingham and Jacksonville; also practically equal to the combined Clearings of Nashville and Savannah. Atlanta's suitability as a Clearing center is forcibly illustrated by the fact that two of the greatest public utility corporations operating in the South thus employ it: The Western Union clears through its Fiscal Agent in this City 4854 points in the States of Alabama, Florida, Georgia, North Carolina, South Carolina, Mississippi and Tennessee (the seven States suggested as a Southeastern Region) and, in addition, Kentucky and Virginia. Incident to their method of remittance, only a small portion of this business passes through our clearings. The Southern Bell Telephone and Telegraph Company clears 266 points in Alabama, Florida, Georgia, North Carolina and South Carolina, (five of the seven States of the Southeastern Region.) I submit, gentlemen, that this use of Atlanta as Clearing headquarters by two such astute and well organized corporations, is tangible evidence of her accessibility and the convenience of her facilities. It is pointed out by some Cities remote from the center of the Region desired that they lend some money in portions of this Region. Such sums as they do lend, bowever, are trifling compared to maximum borrowings for crop moving. Page Thirty-six Clearings Show Commerce The Banks of Atlanta have used their finances to promote commerce and commerce has produced our clearings. We have also extended liberal accommodations to the Banks throughout Georgia. Under the old Law we have not striven to compete with reserve Cities outside of the State. A Southeastern Region, under the new Law, would put us, for the first time, in a position so to compete. New York is the real money market for this Southeastern Region and only a RESERVE BANK can replace this long powerful money center. The moving of our cotton and other great Southern crops requires at certain seasons a large amount of ready cash and the Southeast is thus a heavy borrower—another strong reason for the establishment" in this great active Region of a Reserve Bank which shall meet this need with benefit both to the borrower and to the Reserve Bank. In this connection I may say that under the old system it has been necessary to create borrowing capacity with the recognized money centers, and in order to do so heavy reserves have had to be lodged in banks in the North and East. A Southeastern Region would eliminate this necessity, because our reserves and credit security would be on the ground, so to speak. No City in the United States has proven a stronger advocate of National Banks than Atlanta. With one exception, all the members of her Clearing House are National Banks. That they are in sympathy with the new Law is indicated by the fact that Atlanta signified, through her Clearing House, her endorsement of the plan before the Bill had actually been passed. She was the first City in the United States to take this action. The Clearing House Banks are all strong and successful institutions and in a position to command an increase of capital to any reasonable amount that might be desired. From all that has been said it will be easy, gentlemen, f or you to gather that a SOUTHEASTERN REGION with a RESERVE BANK in ATLANTA is, in our minds, an important feature of the new banking system—a system whose fundamental idea is that all the people of the entire country shall be afforded equal banking facilities. Pa ge Thirty-seven Banking in the Southeast By Robert F. M add ox. Vice-President American National Hank. The attention of the Committee is called to the following statistics: NATIONAL BANKS IN PROPOSED SOUTHEASTERN DISTRICT OCTOBER 31, 1913 Number Capital Surplus Deposit* North Carolina 72 $8,460,000 $2,859,525 $3$, 6| 9.75* South Carolina 48 6,365,000 2,151,400 21,724,859 Georgia 117 15,168,500 9,333,ooo 52,295,249 Florida 53 7,505,000 3,087,677 33»IO4»644 Alabama 90 10,180,290 5,851,293 43«555i°62 Mississippi 33 3,385,000 1,644,653 M»643f856 Tennessee 109 13,217,500 5,552,655 62,895,220 552 $64,281,290 $30,480,263 $264,138,629 30,480,263 STATE BANKS, OCTOBER 21, 1913 Number Capital Surplus Deposits North Carolina ..412 $11,018,271.87 $3,016,348.93 $65,337,4«I-97 South Carolina ..322 12,778,000.00 4,621,000.00 51,000,000.00 Georgia 697 28,895,513.67 16,514,360.65 9M4«-535-27 Florida 189 6,427,220.00 3,061,665.60 27,542,3*5-97 Alabama 258 12,800,000.00 6,800,000.00 52,500,000.00 Mississippi 10,341,695.55 2,356,812.52 38,860,727*59 295 Tennessee 410 9,380,258.79 3,294,409.88 36,137-434^6 2583 $91,640,960.00 $39,664,597.00 $362,819,564°° 39,664,597.00 $'3»,3°$,557-°° T June 4, 1913. BANKING POWER OF THE SOUTHEASTERN DISTRICT Capital and „ . , „ Number Surplus Deposits Total National Banks . . . . 522 $94,76i,553 $264,138,629 $358»9°°'182 State Banks 2583 I3M°5,557 362,819,564 494,*3<«121 3*05 $226,067,110 $626,958,193 $853,035,303 Our territory, as shown by the map, has located withjn its boundaries 522 National Banks and 2,583 State Banks and Trust Companies, making a total of 3,105. Fag« Thirty-**1* These institutions have a combined capital and surplus of $226,067,110, with combined deposits of $626,958,193. The National Banks have a capital and surplus of $94761,583 and individual deposits of $264,138,629. The State Banks and Trust Companies have capital and surplus of $131,305,557, and deposits of $362,819,000. Should only the National Banks become members, they would furnish the Federal Reserve Bank, on a six per cent subscription basis, a capital of $5,685,000, and estimated deposits of $13,250,000. Should the State Banks and Trust Companies become members, they would furnish additional capital, $7,878,000, making the total maximum available, $13,563,000, and the additional deposits of $18,100,000, making the total available deposits, exclusive of such funds, as the Government might place with it, $31,350,000. Should all the National Banks go in the new system and half the State Banks, the capital of the Reserve Bank for this district would be $9,625,000, and the estimated deposits would be $22,300,000. From the above figures, we believe that the Banks in the States mentioned would unquestionably provide the capital required under the Federal Reserve Act for a Reserve Bank to be located in this territory. The National Banks have with practical unanimity signified their desire to enter the new system, and while the State Banks seem to be "watchfully waiting," we believe a large number will soon realize the benefits to be derived and take advantage of the opportunity to become members. An Accessible Market The real object of locating the Regional Reserve Banks is to establish a more accessible market where Banks may be able to re-discount their bills and to meet quickly the demand for emergency currency during the seasonable period of the year, without the doubt of its availability which has existed in the past It seems to be generally agreed that it will be desirable to have the new banking centers at points that wilt be not more than a night's travel from the outlying points where business is being done by member Banks. In the East, where communication is easy, population dense, and p age Thirty-nine the districts necessarily smaller, the case is comparatively simple, and we recognize the difficulties your committee will probably have in dividing the country into eight or more districts, each of which will be commercially strong, banking intercourse easy, demand for loans diversified, and the section segregated to the satisfaction of its people. We believe that a Region consisting of at least a portion of the States we mention would come as near filling the object of the bill, considering all its phases, as any other district which may be designated in the United States. Readjustment of Methods We believe that the Organization Committee will be more inclined to look to the possibility of a readjustment and improvement of banking facilities under the new system rather than be guided by the forced trend of banking under the old system. In normal years, even under the old currency bill, there was a sufficient amount of currency to conduct the commerce of our country; and even at present there is no particular demand for additional currency. It is therefore apparent that under the operation of the new currency bill, there will really be but little need for additional currency, as under the power of the Federal Reserve Board, the surplus funds of the several Regional Banks may be diverted and used where most needed. While the Region we have outlined has many diversified lines of business, we recognize that for a few months in the year it may be regarded as a borrowing district. This we do not believe is a reflection upon its establishment, but rather an argument in its favor. If, under the old system, the loanable funds of certain Regions were forced by lack of demand in those regions to move the other regions in order to find employment, it is not unreasonable to suppose that the deposits in the Federal Reserve Banks to be located in those Regions will be forced to find borrowers in other Regions. It would be almost impossible to so divide our great country into eight or twelve regions where the supply oi money would at all times equal the demand for loans. This was recognized by Congress when it gave the Reserve Banks the right of open market operations, and gave Page Forty to the Federal Reserve Board the right to use the surplus iunds of one district to meet the unsupplied demand in another district. The total loans and discounts of the National Banks, as shown by the report to the Comptroller on October 21, I I 9 3> was $6,260,877,000. Of this amount only $16,5*6,347 w a s rediscounts for National Banks; and only $83,943,695 was bills payable of National Banks—making a total of $100,450,042, or less than 1 6/10% of the total loans of National Banks. At the same time the United States had on deposit in National Banks, including postal savings deposits and deposits of disbursing officers, $111,059,215. In other words, the United States had on deposit in the National Banks $11,000,000 more than the entire amount the National Banks had found it necessary to borrow. If the Federal Reserve Banks had been in operation at this time, presuming they would have had a capital of $100,000,000 and deposits of $500,000,000 made up exclusively from the National Banks, they would have had, after deducting the gold reserve required against deposits, a loanable fund of $425,000,000 or more than four times the amount required to supply the necessary loans to the National Banks, leaving $325,000,000 for open market operations: The total amount of bills payable and rediscounts of the National Banks in the States suggested as a district for the Southeast on October 21, 1913 (which is about the maximum for the year) was $23,801,000. Judging by the past, it is reasonable to presume that for about half of the year the banks of this section will not find it necessary to call heavily upon the Regional Bank for re-discounts, but for the other half, may find it convenient to use the discount privilege freely, and even beyond the available deposits of the Regional Bank. Government deposits could then be transferred to this Region, as was recently so wisely done, or the Federal Reserve Board might find it advisable to have the surplus funds of another Region meet the demands here; and lastly, the new currency could be issued, which automatically retires when the demand for it ceased. ra «e Forty-one No Idle Money We admit that this section has but little idle money. Since the war, the reconstruction of the South has required all our energy and all our capital. The rapid development of our farms, our factories, our mines, our Cities and our commerce has called for even more capital than our Banks could supply; and unlike some of our richer or more finished sections, our Banks have not been forced to go into other sections for desirable loans. Figures and facts have been shown, and, will be presented later, illustrating the wonderful growth of the South, its diversified industries, and what the "Atlanta Spirit" has done for the Gate City of the South; also the accessibility of Atlanta from all points in the Region suggested. The geographical location and railroad facilities of this City have been the means of our merchants developing a remarkable trade with surrounding States, which is but a forerunner of the convenience and benefit a Reserve Bank in Atlanta would be to the Banks of this Region. We do not believe that it will be the wisdom of your honorable Committee to consider where the Banks of this Region have borrowed in the past of so much importance as from what convenient center these Banks may be supplied in the future. Under the old regime, the Banks of the nation were dependent upon a single and uncertain money center, and the nation was a slave to the system. When President Wilson signed the new Currency Bill the shackles which had bound the banking business in narrow limitations fell asunder, and the people received it as the Emancipation Proclamation of a New Freedom from currency panics. The Southeastern States we have suggested as a Region under the new system are throbbing with new life Its people, while true to the traditions of its past, are justly proud of the prosperity of its present. They are loyal to the Nation and dauntless in their democracy. No other section of the country has risen above such adversities to such commercial importance. In the veins of its Page Forty-two men and women there flows the purest Anglo-Saxon blood to be found in any part of this Republic. For what we have accomplished in the past, we ask your help in the future. Georgia has more National banking capital than any State in the Region suggested; and Atlanta has more National banking capital than any City in the States included. If Atlanta and this Region is given a Federal Reserve Bank, we can face the future with renewed strength and approach with confidence the continued development of our section to the credit of the New South and to the glory of the Nation. Forty-three Financing The Crops By Joseph A. McCord, Vice-President Third Xational Bank and Member Currency Commission American Bankers Association. Cotton / ^ O T T O N is the greatest producer of value of any C commodity in the Southern States. Fifty-three per Vh-/ cent is grown East of the Mississippi River. Department of Commerce, Bureau of Census of the United States, shows Ginners' Reports of 1913 crop up to January 16th, 1914, East of the Mississippi River to be 7,544,927 bales. Valued at $65.00 per bale, and seed at $10.00 per bale, it gives a money value of $565,869,525, or one-sixth (1/6) of all the money in the United States. Georgia is the centre of this territory, producing of the above amount, 2,316,388 bales, or 30.79K A. T H E ROCK, 64 miles Southeast of Atlanta, in Upson County, near the corner of Upson, Pike and Monroe Counties, Georgia, being the numerical center of the crop of Cotton for 1913, East of the Mississippi River. Moreland, 45 miles West of Atlanta being the geographical center of the cotton producing territory. Atlanta is the central City of this Cotton Belt, taken from a numerical, as well as a geographical point of view. Cotton is purchased in small towns and money payments are necessarily made at these towns. Buyers classify, mark for export, and ship from interior towns and Cities, to ship side at ports, hence the banking facilities should be nearer the centre to benefit the greatest number of people. B. There are 27 compress points in Georgia, where cotton is concentrated and export bills are issued; V 126,803 bales compressed. Other States have similar concentrating points, but as all of these will equalize, Georgia is taken because it is the centre of a pivotal State. Page Forty-fo*r Central Location Important To locate a Reserve Bank at a Port would not serve the interior as well as if located nearer the producers; to locate at any extreme would not serve the whole section. Currency can be shipped to any town or City on any main line of Railroad in the seven Southeastern States from Atlanta, Georgia, after five o'clock in the afternoon of one day, and delivered by not later than ten o'clock next morning to the farthest point in these States. This cannot be done from any of the competitive Cities. As evidence as to the value of Cotton to a local community, up to January 16th, two Counties in Georgia produced more than 50,000 bales; Laurens leading with 52,551 bales, and Burke following with 52,397 bales. The cotton crop in Laurens in a single year is worth more than all the farm land and other real estate of the County. While in Burke County the value of this year's Cotton crop almost exactly equals the total wealth of all sorts accumulated upon the tax digest during the whole history of the County. While it is true this vast amount of wealth came into this locality, it is also true that nearly all of it went out for the purchase of fertilizers, supplies, food and clothing for the producers of this enormous wealth; hence the necessity of financing a community thus situated. * It requires more actual money to produce the cotton crop than any of the leading crops of the United States, because of the necessity of the hand cultivation and gathering, and the tenancy system. Farmers, merchants and manufacturers require an extension of credit to produce it. These credits can best be served and investigated from some central point than from any border point of the territory. The exportation of Cotton to my knowledge has restored normal conditions in two money panics, namely ^ 3 and 1907. The values already stated, are for the crude product, we must not lose sight of the fact that a constantly increasing proportion of this product is being manufactured into yarn, cloth and other needs of trade and commerce within the territory suggested by us, for this banking district. The State of North Carolina manufactures **ee Forty-five into these products more bales of cotton than grows on her soil. Georgia manufactures into yarn and cloth onethird of her entire crop. Financing Factories The States named in this territory, for which we ask a Regional Bank, manufacture the following numbers of bales by States namely: North Carolina South Carolina Georgia Alabama Mississippi (estimated) Tennessee Total «7&>359 775.»5' 648,13* 299,924 100,000 81,790 2,782,055 When thus manufactured, it is estimated to be worth 25c per pound, equivalent of $125.00 per bale, or giving a total worth of $347,756,875. The financing of these mills takes an enormous amount of credit; the Banks located in this territory have done a great deal of this; Banks under State Charters handling vast amounts of it The necessity of money and credits to finance the crops of this territory can best be illustrated by dividing the year on September 1st, when the movement of the main crop (that is Cotton) commences. The first demand the City Banks have is from interior Banks for currency to start the movement of the crops, that is in the purchase of advance bales, with which to get money to pay the laborer for gathering of the crop, and of the cotton seed mill industries for money to buy the first cotton seed, the value of which product is used in paying for picking of the cotton; both of these come on the City Banks about September 1st, and continue until the first of December, at which time there is a lull, and then again starts up about December 15th, running through to January 1st. The next demand we have for money is from the Cotton Mills and the Cotton Manufacturers, who begin to make their loans about the middle of October, continuing to the first of January; they want these loans until April, May and June. Oil Mills and Fertilizers When we have supplied the country Banks and the Oil Mills, then comes the demand from the Fertilizer Page Forty-"* Manufacturers, starting in say about the ist of December, continuing to the first o f February; their request is for accommodation until June and July; we have thus served these immediate interests. Then, as they begin to return to us advances made to them, commencing with the Country Banks paying back their loans in October and November; the Oil Mills and Cotton Manufacturers from the middle of January to May and June, gives us money and credits to re-invest for the benefit of the Wholesale Trade, which starts in February, continuing on through the Summer until late in the Fall. Our greatest borrowing period is possibly in the early Spring before we get the returns from the Cotton Oil and Cotton -Mills and Fertilizer factories when we are called upon to finance this other line of trade. Then again before the Wholesale Merchants and country Banks can replace us with funds loaned to them, comes the demand already referred to for the movement of crops; therefore our other borrowing season is largely from August until November. The crops of the Southeastern territory covered by the States asked for this Regional Bank, shows an annual production in dollars of 1,114 millions; manufactured products of all kinds in this same territory for the same period amounts to 1,012 millions. These figures show amount of crops and manufactures for the year 1909, and have doubled in ten years, It will, therefore, be seen that money and credits in this Southeastern territory is very evenly balanced between the crop movement and that of the manufacturers. It is also shown that this money is kept in constant use during the entire period of the year. The admitting of State Banks to the Reserve Banks, and the liberalizing of the National Bank Act by Section *3, of the Federal Reserve Act, will materially aid in the financing of these various products. From the preponderance of evidence given above and furnished by'the other speakers, it is shown that a Reserve Bank of sufficient capital would result from your selection of Atlanta, and we believe that a great number of our larger State Banks will enter the system as soon as the rules are published, and the location named. Forty-seven Foreign Exchange By A. P. Coles, Vice-President Central Bank & Trust Corporation. N recent years quite a number of Banks located in Cities and towns in the Cotton Belt have added to their regular banking business a Foreign Exchange Department for the purpose of purchasing 60 and 90-day bills of exchange drawn with documents attached against shipment of Cotton and other products. These bills are drawn on foreign Banks and bankers for acceptance, but only purchased by the Banks on commission, or brokerage, for account of Banks and foreign exchange buyers in New YoTk. Atlanta is the only City between Baltimore and New Orleans that purchases these bills and deals direct with European financial centers in international banking. That is to say, Atlanta has accounts abroad and daily transactions with Banks in London, Liverpool, Paris, Bremen and Berlin. This business has developed by reason of the large volume of bills of exchange drawn against exports that originate in this territory, and the bills are offered for sale here for the reason that Atlanta affords quick reimbursement in currency at the time of the heavy movement of the cotton crop when need for cash is imperative. During the year 1913 the total amount of foreign exchange bought and paid for in Atlanta and remitted direct to Europe for account and credit of Atlanta was $i9r 444,145.18. Against these credits abroad the Atlanta Bank reimburses itself in the regular course of business by the sale of Bankers' Checks and Cable Transfers wherever the demand for foreign credits is the greatest. In addition to this means of reimbursement, during the year 19*3 the Banks here disposed of credits abroad to the extent of four and a half million dollars: I Page Forty-«te ht By open letters of credit furnished importers. SECOND: By Bankers' Acceptances arranged abroad against delivery of shipping documents for imported goods. THIRD: By sale of checks or cable transfers in pay ment of importers' bills due abroad. FOURTH: By credits in Atlanta opened by foreign Banks for their customers who export goods through their representatives or agents. FIRST: Imports of Fertilizers JUST AT THIS TIME credits in Berlin have been arranged to take care of twenty-six vessels already cleared for the following ports: Charleston 5 Savannah 9 Pensacola 2 Mobile 2 New Orleans 3 Norfolk 1 Wilmington 2 Brunswick 1 Jacksonville 1 26 THE AMOUNT INVOLVED in the transportation of fertilizer material on these twenty-six vessels amounts to One and a Half Million Dollars. ANY EXPORTER in this territory can get reimbursement in cash for his foreign exchange sold in Atlanta within thirty hours from the time he mails his bills. Whereas, sales made in New York cannot bring returns in less than five days. Therefore, the natural market for foreign exchange should be near the point of origin, as quick returns in cash for bills of exchange facilitates the business °f the community, eliminates time and interest for the seller, and is the essence of financial economy. A foreign exchange market created, for original bills, far removed from the source is artificial, and has only been maintained and controlled through the power of concentrated capital. p age Forty-nine SECTION 14 of the Federal Reserve Act relative to open market operations will be of immense advantage to all this section if the Reserve Bank is conveniently located, for the reasons as stated above; and the volume of business in foreign exchange that a Reserve Bank can do in this district is practically unlimited, when it is considered that there was exported from this district out of the cotton crop for the year 1912-1913, 1,935,000 bales of cotton (Shepperson's Cotton Facts), against which foreign bills of exchange were drawn to the amount of $135,000,000.00. The amount of other products will bring these figures well above $150,000,000. DURIXG THE PAST season, that is to say, from September 1st, 1913, to date, foreign bills of exchange have been sold in Atlanta originating in Georgia, Alabama, South Carolina, Tennessee and Mississippi; and the volume of this business done in Atlanta was limited, not by price, but by lack of sufficient capital, which will be entirely overcome if a Federal Reserve Bank is established here. T H E NET PROFIT resulting from foreign exchange transactions originating in this territory, and handled direct from Atlanta, averages $1.20 per thousand, as against the average normal profit resulting in foreign exchange transactions in New York of 35 cents per thousand; the difference being exactly the average cost of transportation on currency from N e w York to this district. Export cotton is covered by marine insurance policies covering the risk at and from the point of purchase in the interior through the port to the port of destination. This form of insurance has been recently perfected by Marine Insurance Companies on account of the demand for insurance covering shipment on through bills-lading. Therefore, all marine insurance is ngw perfected in the interior and not at the ports, as formerly. There is a difference of cost to the exporter of 65 cents per thousand in favor of insurance on through shipments from the interior as against local insurance to the port and marine insurance from the port to the port of destination. A FEDERAL RESERVE B A N K located here would find this particular branch of its business very profitable, bringing in a better net result than that derived from the dis- Page Fifty counting of commercial paper at a rate of interest lower than 4%. DURING THE CROP moving period when naturally there will be a heavy demand upon the Reserve Bank for its circulating notes, against which they are required under the law to carry a 40% gold reserve, their purchase of foreign exchange will be particularly desirable for the reason that it will give the Reserve Bank the power to draw gold from abroad for their increased reserve requirements without depleting or shifting the gold supply of this country. A FEDERAL RESERVE BANK located in the center of the Atlantic and Gulf States cotton district handling foreign exchange originating in this district would naturally command the respect and consideration of all foreign bankers, more on account of the volume of business it could offer European bankers than the amount of capital employed in its operation. Fifty-one Cotton Seed Products and Commercial Fertilizers By Mell R. Wilkinson, President Atlanta Chamber of Commerce and President Ashcraft-JVilkinson Co. n p H E cotton seed industry is only about thirty-fivt I years old and the first mention of it in the census A is for the year 1886, when it cut a very small figure. The crush of seed at different periods is given as follows : TONS OF SEED CRUSHED i899 190+ 1909 19" 2,479,386 3.308,930 3.798.549 4.92I.O73 The increase in the value of products was much more rapid, owing to the improvement in the process of manufacture and the advance in the market price of the seed and products: '899 1904 $58,726.63* 96,407,621 147,867,894 As the seed averages about half a ton to the bale or cotton, the crush of 4,921,072 tons in 1911 represented the seed from $9,842,144 bales. As the cotton crop was 16,250,000 bales, it is clear that 60 per cent of the seed grown that year was manufactured. The proportion varies with the season and the conditions and price of seed. In 1909 the mills crushed 71 per cent of the crop. Cotton Seed Products of This Region The census abstract does not give the product of this industry by States, but the cotton bulletin shows that 56 Page Fifty-two per cent of the crop is grown in the seven States of the Southeastern Region. Applying that ratio we get these figures: Value of Cotton Seed Products 1909 Millions Cotton States 148 Southeastern Region . . . 83 The census bulletin for Georgia gives the product of this one State as $23,000,000. This product is clear gain to these States, for it is so much added to the crop for seed which were worth less as fertilizer under the old method than they are after being fed to animals. The value of the meal is realized when it is fed to animals and the fertilizer value of the manure is fully as great as that of the meal before it was fed. This product is gradually linking a cattle industry to the cotton crop and is thus incidentally aiding to diversify farming and enrich the soil. Cotton Oil Manufacturers have learned this secret and frequently combine cattle feeding with seed crushing. Our returns from local manufacturers to the Chamber of Commerce show a total of $13,607,000 for this County during the last fiscal year of the companies reporting. The American Audit Company certifies $11,607,000 and one return from a large corporation, received after the compilation, adds $2,000,000. An important fact in connection with this industry is that the oil, its chief product, is largely exported and becomes the basis of an immense amount of foreign ex change. Commercial Fertilizers Georgia is the largest consumer of fertilizers among the States of the Union and the Southeastern Region takes more than half of the annual consumption of the United States. Of 114 millions reported by the census bulletin on Agriculture as the amount spent by farmers of the United States for the purchase of fertilizer during the year 1909, Filty-three the seven States of the Southeastern Region spent 59 millions, distributed as follows: North Carolina South Carolina Georgia Florida Tennessee Alabama Mississippi $12,262,533 15,162,017 16,860,149 3*609,853 1,216,296 7.630.952 2,703,271 Closely connected with the fertilizer industry is that of cotton seed products. They are so related that most concerns combine the two industries, because the same capital which is used in the cotton seed industry during the months of October, November and December is released to serve the fertilizer industry during the months of January, February, March and April. It is an interesting and important fact that the use of capital in these industries begins at a time when the great pressure of cotton upon the financial institutions of the country has begun to pass off. This is well illustrated by the fact that the banks of Atlanta, which now serve the fertilizer companies, would find it difficult to do so if the demand came before the end of the cotton season. When it is remembered that the two industries have total products amounting in round numbers to 140 millions, or nearly one-third of the cotton crop of this Region, the sequence of time in this demand for capital is manifest. Money which has been financing the cotton movement will be released in time to handle the cotton seed oil products and fertilizers in their season. International Character of the Trade One firm in Atlanta imports fertilizer material and at this time has vessels unloading at Norfolk, Wilmington, Charleston, Savannah, Jacksonville, Pensacola, Mobile and New Orleans. All this material is distributed and shipped from the Ports and the bills of lading with drafts attached are deposited in the Atlanta Banks for collection. This company used 36 vessels. By the close of the season the number of vessels had increased to more than fifty* in the business this year, 11 of which arrived in January? Page Fifty-*01* 25 to arrive in February. The volume of business done by this firm and one other in Atlanta amounts to $5,000,000 annually, through Atlanta Banks, although little of the material is brought to Atlanta. Atlanta's Fertilizer Trade The Atlanta Chamber of Commerce has returns from the following Fertilizer Companies doing business here: Armour Fertilizer Works Porter Fertilizer Works Chickamauga Fertilizer Works Swift Fertilizer Works International Agricultural Corporation Ashcraft-Wilkinson Company A. A. Smith Fertilizer Company Empire Cotton Oil Company. These firms report a business for 1913 aggregating $14,867,910. With $13,027,168 for Cotton Seed Products, the combined business of the two industries is $27,859,078. Fifty-fiyc Manufacturers' Agents By R. S. Wessels, Manager Pittsburgh Plate Glass Co. * T * H E R E are 485 Resident Manufacturers' Agents or I Representatives in Atlanta. Our reports from 150 "*• of these show the following volume of business handled in the year 1913 for the States indicated: North Carolina South Carolina Georgia Florida Alabama Mississippi Tennessee Undivided Total $3,181,733.00 4,971,108.00 18,882,677.00 5,600,187.00 6,337,641.00 2,062,589.02 4,446,973.00 6,301,243.00 $51,784,151.00 It is fair to assume that those who have not reported their volume of business have secured their proportion of orders and on the above basis the figures would approximate for the whole list a grand total of $167,000,000.00. Atlanta is generally selected by the most prominent manufacturers throughout the country as the best point from which to conduct or handle business in this section and hence they place their Representatives or Agents here. There has been an enormous increase yearly in the addition of Manufacturers' Agents. Strong evidence of this exists in the fact that for a City the size of Atlanta there is an unusually large number of fine office buildings. There is now in course of construction and nearing completion one of the largest and finest office buildings in the entire South and plans have been drawn and accepted for several more. Our experience shows that in many cases after the Manufacturers' Agent has operated here for a time eithei a stock or factory branch is installed by his principal. It is a fact that there are many articles of general use carried in Atlanta which are not distributed from any other City in the Southeast. Notably among these are Page Fifty*** certain brands of well-known cereals, one firm alone traveling twenty-four salesmen whose orders are sent to Atlanta and shipped and billed from here. Also certain makes of adding machines, gentlemen's linen collars; also polished plate glass and mirrors, dental supplies and large stocks of various repair and fill-in equipment of one oi the largest cotton machinery manufacturers in the United States. Also large stocks of two of the most prominent electrical companies in this country, whose annual business in this section runs into the millions. Atlanta is also headquarters for the larger passenger and freight elevator companies whose business for this Region is very extensive. Fifteen of the largest millinery houses in the United States send their representatives here twice yearly with samples, and the buyers of this Region come here for their purchases in this line. Traveling Agents all over the United States who cover this section quite generally speak in glowing terms of the business here and splendid hotel facilities for their accommodation. Page Fifty-seven Agricultural Implements in the Southeast By Clyde L. King, President Atlanta Agricultural Works. F ROM the view point of a manufacturer of Agricultural Implements and being closely in touch with the development of the farming interests of the Southern States, Atlanta appeals very strongly to me as the best and most logical location for any enterprise looking to the general upbuilding of this section. The central location and already progressive spirit and beneficial influences so unselfishly thrown out by Atlanta bankers and business men over the entire Southern States marks her in a class by hci; self in the Southeastern States as an upbuilder of home and Southern industrial enterprises, and places her advantages more at the command of all the surrounding territory than any other Southern City. There are now manufactured at or sold from Atlanta annually more than eight million, four hundred ana eighty-five thousand dollars worth of farming implements to approximately thirty thousand substantial buyers in seven Southern States embraced in this Region and divided as follows: Annual Annual Annual Annual Annual Annual Annual sales sales sales sales sales sales sales to to to to to to to 14645 5200 3050 1750 1400 2200 uoo buyers buyers buyers buyers buyers buyers buyers in in in in in in in Georgia Alabama S. Carolina X. Carolina Tennessee Mississippi Florida $3,500,000 1,140,000 1,050,000 950,000 720,000 600,000 525,000 Adding to this the sales made over this Region by the General Southern Agents of Eastern and Western manufacturers whose offices are located here on account of At lanta's accessability to the whole Region, the total amount of annual sales will easily reach more than ten million dollars. Page Fifty-«iRht And yet, there are within reach of Atlanta thousands of acres of undeveloped farming lands awaiting assistance for development and notwithstanding Atlanta's present resources and her progressive influence and readiness to lend assistance, they are quite inadequate to meet the demands upon her. These undeveloped farming lands are located through out the entire Southern States from the northern boundary line of North Carolina to the Eastern boundary line of Mississippi and to the Gulf of Mexico and yet they arc within easy reach of Atlanta with her eight systems of railway operating over fourteen different lines, crossing each other and connecting with other lines throughout the South until the lines radiating out of Atlanta cover the Southern States as a piece of poultry netting, and there is hardly a town of any size in the South but is reached by one or more of these lines of railway radiating out of Atlanta, or are in close proximity to them. Over these fourteen lines of railway there are daily running out of Atlanta seventy-five passenger trains operated by these eight systems of railway, averaging a train leaving Atlanta every twenty minutes during every day and night of the year. The same number of passenger trains run into Atlanta daily, enabling the residents of any section of the Southern States to easily reach Atlanta at almost any minute of the day or night; losing very little time from home, as the fartherest points within this territory means only about a ten-hour journey. With seventy odd regularly scheduled freight trains leaving Atlanta daily (not taking into consideration the numerous extra trains operated during the busy seasons) and each road loading daily from Atlanta package cars to almost every point from the Potomac to the Gulf, Atlanta enjoys the most advantageous facilities for reaching any point in the Southern States with solid cars or less than car load shipments in almost express time. Any enterprise looking to the development of the farming interests of any section is but laying an indestructible foundation for the upbuilding of that section and the establishment of any such enterprise at such a point, central of location, easily accessible and with the unselfish determination to utilize its facilities in the best manner for the greatest good to the largest number, is aiding materially Page Fifty-nine in meeting the demand which is steadily growing throughout the Southern States. The cry of the Southern farming interests for higher development is growing louder and louder every year; the efforts of the Southern manufacturers of farming implements and kindred lines is growing greater and greater every year, but both the farming interests and the manufacturers of improved farm machinery need more encouragement in the general development of their interests, and such encouragement and assistance distributed from the central location which Atlanta only affords in this region, on account of her superior facilities for quickly reaching every section of the Southern States, will greatly further the accomplishment of this development. In other words, gentlemen, it is my honest belief that the builders of farm tools and agricultural machinery in the South, cannot build up their businesses and serve the greatly increasing demand for good goods and good service, unless your Honorable Committee assist our now broad gauged bankers in their efforts to help us, by the establishment of a Regional Bank in the City of Atlanta. Page Si»ty Manufacturers in the Southeast ^ census figures show the growth of manufacturing in the Southeast: 1909 $216,656,000 113,236,000 202,863,000 72,890,000 145,962,000 80,555,000 180,217,000 1899 $85,274,000 53,336,000 94,532,000 34,184,000 72,110,000 33,718,000 92,749,000 $1,012,379,000 North Carolina South Carolina Georgia Florida Alabama Mississippi Tennesj.ee $465,903,000 The strength of Atlanta's manufacturing interest is in its diversity. It has been impossible to obtain complete lists of all the articles made in Atlanta, but as there are 548 manufacturing establishments, a large proportion making several articles, it is readily seen there must be more than 1,000 different articles made here. It has been the tendency of large plants to locate outside the City Limits in order to escape taxation, and a large proportion of increase within the last decade does not appear in the Census report on Atlanta's industries for the reason stated. The County outside the City shows a product of $9,939,883 for the year 1909. The liberal policy of the banks to manufacturers has had a great deal to do with the strength and development of this industry. The City takes a pride in her industries and the municipality has encouraged a low assessment for manufacturing plants in order to minimize their burden. The great variety of natural resources set forth in the brief of the Atlanta Chamber of Commerce shows the foundation for the varied manufacturing industries of the Southeastern Region. The variety of industries which constitutes Atlanta's chief strength in manufacturing is also true to a very large extent of the Southeastern Region as a whole. p age Sixty-one Atlanta's Increase The increase of manufacturing at Atlanta is shown by the following figures for the industries within the corporate limits of the City and excluding about $10,000,000 of products made in the County outside the City: VALUE OF PRODUCTS 1899 1904 1909 $14,419,000 25,746,000 33,038,000 As new industries tend to locate outside of the City limits it is necessary to take the County as the unit. The census shows the manufacturing business for the Countv to have been as follows: Capital Product Number Establishments Wage earners Wagf 8 Total persons engaged Wages and Salaries 1S99 $19,188,286 20,049,206 441 10,803 3»494»947 12,145 4,464,773 1909 $44,094,782 42,977,883 548 1 5,877 10,203,517 i9»<>9$ 13,460,801 Fagc Sixty-two Fire Insurance By Milton Dargan, Manager Southern Department Royal Insurance Co., Ltd., of Liverpool. A TLANTA is the only City in the Southeast, and with the one possible exception of Dallas, Texas, in the entire South that has been selected by the Fire Insurance Companies as the center from which their business is controlled. No other City in the South has more than one or two controlling offices, and these are for a limited territory only—a few small General Agencies handling the State in which they are located, or perhaps one or two additional States—whereas in Atlanta are located fifteen General Offices, representing thirty-seven Companies; the number of agencies reporting, and the premiums and losses reported to them being as follows for the year 1913, viz: State Alabama Arkansas Florida Georgia Kentucky Louisiana Mississippi North Carolina Oklahoma South Carolina Tennessee Texas Virginia West Virginia California Missouri Number of Agencies 967 223 766 2777 241 543 698 854 157 730 222 799 552 35 9564 Premiums $1,170,837 288,584 738,653 2,473,389 285,904 873,441 896,228 59M94 172,991 625,628 4*3,57* 1,205,759 567,55* 40,702 15,432 U,622 Losses $593»?63 436,447 328,473 1,243,035 120,720 311,726 445,498 *98,347 32 7*5 457,349 182,475 5<>5,9O9 3Oi,777 i7»9*S $10,401,593 $5,179,636 3,387 NOTE: There is more than one Agency in each town The number of towns reporting to Atlanta is about 3,000. All these premiums are remitted to Atlanta, and losses are paid from Atlanta. Atlanta Banks must handle all these transactions. In order to avoid exchange charges, these losses arc now paid largely by New York drafts, thus necessitating Page Sixty-three the maintenance of bank accounts in New York as well as in Atlanta. But if Atlanta be given a Regional Bank, it would doubtless become a par point, and all these losses would be paid through Atlanta. Outside of Atlanta, in the State of Georgia, there are Local Companies and General Agencies at the following points: Athens, Augusta, Columbus, Savannah, Macon. The number of Agencies reporting, and the premiums and losses reported to these points are as follows: State Alabama Arkansas Florida Georgia Kentucky Louisiana Mississippi North Carolina Oklahoma South Carolina Tennessee Texas Virginia Undivided Business Number of Agencies 164 Premiums $112,935 Losses $91,842 150 527 83,133 853,707 37,885 342.203 41 126 166 48,859 77,804 73,526 14,620 42,750 39,653 132 1 49,692 1,742 41,968 5 78 399 111,476 2x1,9x1 72,523 192,3*3 1784 $1,624,785 $875,762 In addition to the above figures, Atlanta local premiums for Companies who have no General Offices in Georgia amount to $739,697. These figures are to be added to those above given as reported to Atlanta, and to other points in Georgia, the total being $12,766,075. It may be desirable to give separately the figures for the Southeastern District suggested, viz: North Carolina, South Carolina, Tennessee, Georgia, Florida, Alabama, Mississippi, reported to Atlanta and the other points in Georgia named, and also the figures from the States not included in the Southeastern District. These are as follows: TOTAL SOUTHEASTERN DISTRICT Number of Agencies Premiums Losses ^ u3i $1,283,772 $685,705 9x6 821.786 366,358 ? : 3304 3,327,096 1,585.238 sssippi g24 974>O32 48g,24s North Carolina 1020 671,820 238,000 South Carolina 862 675,320 499,317 Tennessee 223 M«J,3i3 182,480 Statc 8280 $8,169,139 $4,045*346 Page Sixty-four TERRITORY OUTSIDE SOUTHEASTERN DISTRICT State Arkansas iventucky Louisiana Oklahoma 7* c x a s Virginia West Virginia Missouri California , Undivided business Number of Agencies 223 241 584 157 799 630 35 Losses $43*,447 120,720 326,346 32,7x5 505,909 374.3OO *7,9i5 3,387 399 Premiums $288,584 285,904 922,300 172*991 1,205,759 679,034 40,702 34,622 15,432 211,911 3068 $3,857,239 $2,010,052 192,313 In considering the transactions handled through Georgia banks, both premiums collected and losses paid should be taken into account. The total of these items for Atlanta is $16,320,926 and for the other points in Georgia, named above, $2,500,547. NOTE: A grand total of 11,348 Agencies in 3,000 towns reporting $18,821,473 in transactions. The custom of all Fire Insurance Companies who operate by Departments, instead of direct from head offices, is to divide the United States into four main districts, viz: the Eastern, Western, Pacific Coast and Southern. Headquarters for these districts are located, respectively at New York (or Hartford), Chicago, San Francisco and Atlanta. Atlanta is, therefore, fourth in importance as a Fire Insurance center in the United States. This does not mean that the local premiums are fourth in volume, but that premiums reported from territory over which Atlanta General Offices have jurisdiction place it in that position—and this is the important feature from the banking standpoint. Naturally, the headquarters of all subsidiary organizations follow this arrangement. The Southeastern Underwriters Association, handling all questions of rates and practices, from Virginia to Louisiana, inclusive: the Southern Adjustment Bureau, having charge of the adjustment of losses South of the Ohio and Potomac and East of the Mississippi; the Underwriters Salvage Company, handling all salvages from Virginia to Texas and Oklahoma inclusive; the Cotton Insurance Association, receiving a million and a quarter in premiums on cotton exclusively, covering transit risk for railways and owners and inland marine risks—are all located here. Page Sixty-five The figures for the Cotton Insurance Association have been included in the tables previously given. Eliminating the Companies who have no Departments, their business being reported direct to Head Offices, nearly all of which are located in Eastern Cities, and who, therefore, have no special interest in any bank except in the East, it can be seen that the others handle the great bulk of their Southern business through Atlanta Banks. From a Fire Insurance standpoint, therefore, the establishment of a Regional Bank at any point other than Atlanta would be a positive inconvenience in so far as the Southeast is concerned. Dallas, Texas, occupies a somewhat similar position in the Southwest to that of Atlanta in the Southeast, but its jurisdiction does not extend East of Louisiana, whereas Atlanta, for many Companies, handles Texas, Arkansas, Oklahoma, Kentucky and Tennessee in addition to the Southeastern territory. . Supplement to Brief on Fire Insurance By Milton Dargan. Having heard the questions propounded to several of the witnesses at the hearing on Friday, in an endeavor, apparently, to ascertain the proportion which the business transacted through Atlanta bears to the total business of certain States, I think it well to give the entire premiums of each of the States in the South, and the amounts reported to Atlanta, and the percentage which Atlanta business bears to the whole, and that tabulation is shown below : TERRITORY OF SOUTHEASTERN DISTRICT « Mate ^. I a ° a 1 m a d ™>" ? &orF* : Mississippi : North Carohna South Carohna 1ennc *« Total Premiums $3,399,876 2,869,714 5,469,336 2,776,784 3,175,274 2,269,485 • 4,337,516 Reported to Atlanta $1,170,837 738 653 2473 389 896228 598 294 625,628 413.57* $24,297,985 $6,916,600 Ratio 344% 257% 45.2% ill* 18.8% 27.6% 9.5% 28.5% Page Sixty-six TERRITORY OUTSIDE SOUTHEASTERN DISTRICT State Arkansas Kentucky Louisiana Oklahoma Texas Virginia Grand Total Total Premium's $2,638,508 4,996,190 4,322,272 3,488,213 9,622,827 4,133.75* $29,201,766 $53,499,75* Reported to Atlanta $288,584 285,904 873,441 172,991 1,205,759 567.55$ Ratio 10.9% $.7% 20.2% 5.0% 12.5% *3-7% $3,394»237 $*°,3io»837 ix.6% 19-3% The premiums for 1913 were secured direct from the Companies operating through their headquarters in Atlanta. Premiums for all the Companies operating in the various States are not yet public, and therefore, not available for 1913, but I have used the official 1912 figures for the total business in each State, and as the volume of premiums for 1913 is practically the same as that of 1912, there *vould perhaps in no State be a variation of onetenth of 1% in the accuracy of these figures. Page Sixty-seven Life Insurance By Robert J. Guinn, General Agent Xe*v England Mutual Life Insurance Co. extent of investments made by the people of any I section in strictly conservative securities may be •^ safely accepted as a true indication not only of the development, progress and prosperity of the people; but it is as well an almost certain index to the magnitude of the financial transactions, requiring adequate banking facilities, in all the other varied lines of industry and commerce in that section. Throughout this nation legal reserve life insurance is more generally bought by the whole people than any other conservative asset and thus becomes a true criterion of general business activities and conditions. Hence the figures covering the transactions in this department of our national life reflect with almost unvarying accuracy the relative volume of business in all the other departments of trade. This test is sound whether supplied to a municipality, a State or a larger subdivision of our country. It is a significant fact worthy of consideration in the matter now engaging your attention, that the legal reserve life insurance companies, supervised and directed as they are by men of profound ability and business foresight, first plant their agencies in those States and sections (laws and health conditions being equal) where there are the surest indications of commercial progress and prosperity. Assuming the truth of the foregoing premises, the figures that follow may prove of value to the Board in wisely determining where best to locate a Regional Bank in the Southeastern States so that the largest possible benefits may be most conveniently rendered to the people to be served. Page Sixty-eight There are a total of eighty-five different legal reserve life insurance companies doing business in the States of Georgia, Alabama, Florida, Mississippi, North Carolina, South Carolina and Tennessee. Of these, sixty operate in Georgia, forty-eight in Alabama, forty-four in North Carolina, forty-two in Tennessee, forty in South Carolina, thirty-eight in Mississippi and twenty-seven in Florida.. On January ist, 1913, these companies had in the States named an aggregate insurance in force of $1,329,812,033 on which $38,205,742 in premiums had been paid for the current year. This insurance by States was distributed as follows: 1. 2. ?. 4. 5. 6. 7. State Georgia Tennessee Alabama North Carolina South Carolina Mississippi Florida Insurance in Force $376,038,397 204,423,455 190,438,143 170,972,820 164,181,206 132,382,552 9*,375»46o Premiums $10,512,946 6,553,535 3,547,662 5,172,384 5,283,366 4,199,192 2,936,657 The State of Georgia which leads in volume in this group of States, is the tenth State in the Union in volume of legal reserve life insurance carried by its citizens, and is the ranking State in this department of business South of the Ohio River, surpassing Texas on the West by $115,000,000 in volume and $2,800,000 in premiums; and Virginia on the East by $160,000,000 in volume and $3,700,000 in premiums paid. Practically every company that operates in Georgia has its principal office in the City of Atlanta, and more than 90% of the premiums paid are cleared through the Atlanta Banks. These facts clearly point to Atlanta as the commercial and financial center of any grouping that may be made of the Southeastern States. Page Sixty-nine Live Stock Trade By Jacob W. Patterson of the Patterson Commission Co. horse and mule trade has increased more than I 100% in the past ten years, notwithstanding the in•*• creasing use of automobile trucks and motorcycles. The cattle and hog trade has increased more than 100% in the last three years. The increase is largely due to the erection of a new Packing House and a new abbatoir; both of which have proven very profitable ventures. The St. Louis Live Stock Reporter, under the head of Southern cattle, quotes prices and numbers shipped to that market right from our own territory that will astonish those who do not make a business of live stock. Why does this stock go to St. Louis to be marketed? Why not market it and slaughter it at home where it is needed for our own consumption? A few years ago the answer would have been: ist. Afraid of the big packers. 2nd. A lack of capital. The first reason does not exist any longer. The second in my opinion is the real reason. When we can sell our cattle at home for the prices they bring in Western Markets, and thus save freight, the additional profit saved to the producers will encourage the cattle industry at home and many thousands of acres of unused lands will be used profitably for the raising of cattle. We believe that it has been clearly demonstrated that cattle can be produced as cheaply in our territory as any other section of the UNITED STATES. We saw train loads of cattle shipped out of our territory to OKLAHOMA and other Western States the past season. Give us capital to develop the Live Stock and Packing Industry and we will keep these cattle at home where they are needed for consumption. Page Seventy The magnitude of Atlanta's business in horses, mules, cattle and swine with the Southeastern States is indicated by the returns of the following dealers to the Atlanta Chamber of Commerce: Jacob W. Patterson Commission Co. White Provision Company Maxwell-Crouch Mule Company of Georgia Turner Bros. Jones and Oglesby Harper & Weathers Ragsdale Mule and Horse Company Weil Bros. A. L. Suttles and Company Al Carlisle E. L*. Tatum T. L. Smith National Stock Yards Commission Co. L. P. Jernigan F. S. Hall Byron Bettis Herren Sc Haley Coggins and Brother R. Warfield and Company Harper Bros. F. M. Stewart. The total volume of business which these Atlanta firms did with the Southeastern States during the year 1913 amounted to $16,435,355.17. This does not include local Slaughter Houses. Page Seventy-one ATLANTA'S RAILROAD SERVICE. The extent of traffic moving through, from and to Atlanta is nhown by the following statement from official sources: Passenger Trains Inbound Daily Outbound Daily Total A. k W. Pt 7 7 *4 6 A. B. k A 3 3 26 C. of Ga 13 '3 6o Sou. Rwy 30 30 W. k A. 6 6 12 Ga. R. R 6 12 6 S. A. L 7 7 '4 8 L. k N 4 4 X 2 76 76 5 Total Sleepers Inbound and Outbound Daily 228 FREIGHT TRAINS INTO AND OUT OF ATLANTA IN JANUARY, 1914Inbound Outbound Through Local Through Local Ga. R. R 167 54 17* 54 A. & W. Pt 57 54 57 54 L. k N 230 27 196 27 C. of Ga 120 26 136 26 S. A. L 228 85 220 85 W. & A 331 26 324 *6 Sou. Rwy 548 162 582 162 2 A. B. k A 54 25 57 5 Total 1,735 Grand Total for January, 1914 Cars Loaded Cars Empty 459 i»743 FREIGHT CARS MOVED IN JANUARY. Inbound Outbound 45,346 26,177 21,742 22,793 Total Cars 67,088 48,970 459 4t396 Total *I4»»7O3 *S. A. L. cars only given in total. Cars S. A. L W. k A A. B. k A Georgia ) L. k N. and > A.&W.P. ) C of Ga Sou. Rwy. PACKAGE CARS FROM ATLANTA DAILY. Atlanta Proper Through Cars 18 n 29 23 i4 ,3 52 26 96 u 35 26 95 Total Car* 27 52 27 87 52 191 TotaI 235 201 436 COTTON MOVEMENT OF ATLANTA. From September 1st, 1913, to January 31st, 1914, inclusive. Stock on Hand September 1st \ 166 bale* Received by rail \......... ' 249,338 " Taken by Local Spinners Shi ments " 16,942 Page Seventy-two