Full text of Federal Reserve Bulletin : September 1917

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FEDERAL RESERVE
BULLETIN




ISSUED BY THE

FEDERAL RESERVE BOARD
AT WASHINGTON

SEPTEMBER, 1917

WASHINGTON
GOVERNMENT PRINTING OFFICE
1917

FEDERAL RESERVE BOARD.
EX OFFICIO MEMBERS.
WILLIAM G. MCADOO,

Secretary of the Treasury,
Chairman.
JOHN SKELTON WILLIAMS,




Comptroller of the Currency.

W. P. G. HARDING, Governor,
PAUL M. WARBURG, Vice Governor.
FREDERIC A. DELANO.
ADOLPH C. MILLER.
CHARLES S. HAMLIN.
II. PARKER WILLIS Secretary.

SHERMAN ALLEN, Assistant Secretary and Fiscal
Agent.
M. C. ELLIOTT, Counsel.




SUBSCRIPTION PRICE OF BULLETIN.
The Federal Reserve Bulletin is distributed without charge
to member banks of the system and to the officers and directors
of Federal Reserve Banks. In sending the Bulletin to others the
Board feels that a subscription should be required. It has
accordingly fixed a subscription price of $2 per annum. Single
copies will be sold at 20 cents. Foreign postage should be added
when it will be required. Remittances should be made to the
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Bulletin supplied to their officers and directors may have it sent
to not less than 10 names at a subscription price of $1 per annum.
No complete sets of the Bulletin for 1915 are available.
Bound copies of the Bulletin for 1916 may be had at $5 per copy.
in

TABLE OF CONTENTS.
Review of the month
Acceptance of drafts and bills up to 100 per cent
:
Loans to cattle raisers
Governor and vice governor of Federal Reserve Board redesignated for ensuing year
State banks admitted during the month
Cooperation of State banks in New York with respect to control of gold
Development of the collection system
,
New issues of Treasury certificates of indebtedness
Growth of the acceptance business
Condition of national banks as shown on June 20
Act permitting State institutions of Pennsylvania to become members of the system
National-bank notes and Federal Reserve notes issued, redeemed, etc., during the year
Why a southern State institution has entered the Federal Reserve System
Description and population of Federal Reserve districts
Export licenses in the foreign trade
Commercial failures reported during the month
Fiduciary powers granted to national banks
New national bank charters granted
Gold settlement fund
Operation of the check clearing and collection system
Comparative statement of leading banks of issue
Course of dollar and sterling exchange
Charts showing
Informal rulings of the Federal Reserve Board
Law department
Business conditions throughout the Federal Reserve districts
Discount operations of the Federal Reserve Banks
Acceptances
Resources and liabilities of Federal Reserve Banks
Federal Reserve note accounts of Federal Reserve Banks and Agents
Earnings on.investments of Federal Reserve Banks
Gold imports and exports
Discount rates in effect




IV

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FEDERAL RESERVE BULLETIN
VOL.

3

SEPTEMBER 1, 1917.
REVIEW OF THE MONTH.

Completion of arrangements for final payments on the first Liberty Loan and resumption of sale by the Treasury of United States
certificates in anticipation of the next Government loan, have been the chief features
of the banking situation during the month of
August. Adjustments necessitated by reserve
transfers from member banks to Federal lieserve Banks, with the consequent shifting of
funds, have been completed. The banks of the
country are now, therefore, definitely upon the
new reserve basis established by the act of
June 21, 1917. Federal Reserve Banks have
continued the policy of maintaining their resources in as strong and liquid a condition as
possible, showing on August 24 a percentage of
reserve against deposits of 80.6 per cent, and
against notes of 86.5 per cent. There has been
a continuance of the movement of State banks
into the Federal Reserve System, while by
opening clearing accounts with the Federal
Reserve Banks and sending in gold and gold
certificates nonmember banks in various parts
of the country have been cooperating actively
with Federal Reserve Banks in consolidating
the gold resources of the country. Due to these
and other contributing factors, the Federal Reserve System finds itself at the opening of the
autumn in an unprecedentedly strong position,
its total holdings of cash on August 24 being
$1,424,769,000.
Government borrowing and Government
financial operations in general continue, as
during the past three months, to be the controlling factors in the banking situation, furnishing, as they do, the most extensive and
important range of transactions in which the
financial community is at present engaged.




No. 9

Practically every banking development is,
therefore, directly affected by, and conditioned upon, the progress of public finance.
There has been a material increase in the
estimate of Government reveG o v e r nment
•
, £ ,-,
revenue and loans. n u e requirements for the coming year, a fact which has a
direct and important bearing upon the probable operations of the banks in connection with
prospective security issues. The time and conditions of the next issue of bonds have not yet
been announced, but a continuation of the
method of borrowing pursued during the past
spring has been undertaken through the issue
of certificates of indebtedness, payable during
November next, whose proceeds are to be retained on deposit for a short time with the
subscribing banks under specified conditions,
and eventually may be tendered in payment
upon allotment of the Government bonds of
the next issue. It will be recalled that during
May and June there were thus issued in all
$600,000,000 in certificates, nearly all of which
were turned in as payment of the installments
due on subscriptions to the Liberty Loan.
The Treasury Department on August 1
offered to banks a new issue of $300,000,000 of
Treasury certificates of indebtedness bearing
3 \ per cent interest. A like issue, amounting
to $250,000,000, was offered on August 20,
making a total of $550,000,000 for the month.
As in the case of the certificate issues which
preceded the Liberty Loan of last June, these
offerings were absorbed by the banks of the
country and the proceeds of the sales have been
paid into the Federal Reserve Banks without
perceptible effect upon market conditions. In
this case, as in that of the first Liberty Loan, the
sale of certificates at stated intervals enables
the Treasury Department to bring about a
651

652

FEDERAL RESERVE BULLETIN.

wide distribution of the certificates and to draw
gradually upon the resources of the country as
they become available. The purchase of the
certificates, payable as they are at Federal Reserve Banks, moreover, provides the purchasing
institutions with exchange sufficient to cover
remittances for subscriptions which may later
be made by their clients to Liberty Loan bonds.
As in the past, provision is made for maintaining the distribution of the country's cash by
retaining the proceeds of the subscriptions to
the certificates in the hands of subscribing
banks up to the moment when it becomes necessary actually to transfer them to the Government for its use. The prompt disbursement of
the funds so withdrawn by the Government,
or their immediate redeposit with other banks
for account of allied governments, guards
against any disturbance that might otherwise
be produced by the shifting of these large
amounts.
The Secretary of the Treasury has prescribed
the method of subscription to
Method of is- t j i e n e w cer tificates in two ansue.
nouncements given to the public on July 31 and August 19, respectively.
In the announcement of August 19 he says that
the proceeds of these certificates will be deposited with incorporated banks and trust
companies as nearly as may be in proportion
to the subscriptions for certificates of indebtedness of this issue made by and through them,
respectively, provided that such subscribing
banks and trust companies make application
for such deposits and qualify therefor, all substantially in accordance with the procedure laid
down in connection with the deposit of the proceeds of Liberty bonds, and upon the same
terms and conditions. The banks have, however, been informed that the certificates themselves or interim certificates will be acceptable
as collateral for any part or all of such deposits.
Banks and trust companies making subscriptions for their own account or for account of
customers who are willing to authorize them to
rehypothecate their certificates will probably




SEPTEMBER 1,

1917.

use the certificates as sole collateral for deposits.
Such deposits will be left as long as the requirements of the Government permit, and whenever practicable five days7 notice will be given
before withdrawal. It is expected that certificates of indebtedness will be issued from
time to time somewhat in advance of the immediate requirements of the United States.
The success attained in connection with the
former offerings of certificates has been repeated with the two August issues, the first
having been oversubscribed $61,525,000, while
the second was oversubscribed to the extent of
$58,000,000. No new policy has been adopted
by the Federal Reserve Board with respect to
the accommodation of member and nonmember banks which participate in the certificate
operations, the rates established by the Federal
Reserve Banks during the first Liberty Loan
being still in effect, while the Board, as was announced in the August Bulletin, has extended
the ruling with respect to the rediscounting of
notes made by nonmember banks. The machinery for facilitating the sale, distribution,
and carrying of the new issue, therefore, continues practically in effect upon the same basis
as during the original loan operations.
In addition to the advances made by the
United States Government to
f o S financing/ a l l i e d n a t i o n s > t h e r e h a s b e e n a
resumption of direct appeals to
our investment market by the foreign allied
countries. The Government of Canada, in a
statement republished in the Bulletin for
August, has already announced, with the approval of the Treasury Department, the issue
of a short-term credit of $100,000,000, and on
August 22 the firm of J. P. Morgan & Co., on
behalf of the British Government, made known
their intention of converting $150,000,000 of
maturing British obligations into short-time
British treasury bills. There has been some
misunderstanding with reference to the nature
of this operation and the relation of the Federal
Reserve Board to it. In a statement issued on
August 23, the Secretary of the Treasury states

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

the facts in the case, and the position of the
Board with reference to the matter, as follows:
"Certain American banks and bankers have
held for some time obligations of the British
Government. The Treasury Department was
asked a short time ago whether or not there
would be objection on the part of the Treasury
to the conversion of $150,000,000 of these obligations into short-time British treasury bills.
I stated that I saw no objection to such conversion from the standpoint of our own Government's financing.
"I regret that the impression is created in
certain publications that this is a reversal of
the position taken by the Federal .Reserve
Board in respect to British treasury bills in
November last. It is neither a reversal of that
position, nor is it inconsistent therewith. It
is merely a conversion of a part of existing
obligations into another form. The conditions
now existing are quite different from those
which prevailed in November last. The present transaction creates no new obligations in
our markets and is designed merely to facilitate
the payment of those already existing.
"1 may also state that the views and attitude
of the Federal Reserve Board are in complete
harmony with the action of the Treasury
Department and that it gave me pleasure,
while the matter was under consideration, to
discuss it with members of the Board."
Clearing House reports received from principal
eastern cities for the five weeks
f endin
S A u § u s t 18 i n d i c a t e t0
some extent the effect of the
Government's loan operations on the position
of the banks. These operations have caused
withdrawals on a large scale from New York
in favor of banks in the interior. Such withdrawals are followed by transfers back to
New York on Government account of funds
subscribed by these banks. Advances are then
made on Treasury account to the New York
representatives of the foreign allied Governments, and the latter thereupon deposit the
larger part of these advances with the New
York banks, where they again alter the reserve
position. These movements of funds from
and to New York materially affect the holdings
of the New York banks from week to week.
In the same manner funds paid on account of
Government loans by the local banks are




653

largely redeposited with qualifying member
and nonmember banks, thus for the time beingraising the reserve percentages of these banks,
either through increase of cash or through
credits with the Federal Reserve Bank where
they count as reserve of the depositing members, since depositing banks are not required
to keep reserve against these Government
deposits. The New York banks have thus
shown relatively small losses in reserve during
the past five weeks.
The statement of condition of national
banks issued by the Comptroller of the Currency on August 1, and representing the
position of the banks as of June 20, a summary of which is published elsewhere in this
issue, is the last statement under the old requirements, the legislation of June 21 having
superseded them. According to the Comptroller's statement, the total reserve holdings
of all kinds reported by member banks were
$2,406,357,000, including in this figure, however, $669,898,000 balances with approved reserve agents, of which only $181,234,000 could,
under the provisions of the old law, be counted
as reserve. Omitting from consideration the
balances with reserve agents, the excess cash
reserves aggregated only $189,523,000. Under
the new system after the transfer of reserves
these bank balances will no longer figure as
reserves. The amount carried in Federal
Reserve Banks (included in the foregoing
statement of total reserve) was $862,170,000.
Between June 22 and August 17 the member
banks' reserve balances with the Federal
Reserve Banks increased from $806,209,000
to $1,130,817,000, largely through transfers
of reserves. There has thus been an increase
in the balances carried by member banks with
Federal Reserve Banks between June 22 and
August 17 of $268,647,000, which represents
practically the net result of the operation.
There is no way by which either member
banks' demand deposits or their present cash
holdings can be more than estimated. For
those New York member banks which are also
members of the Clearing House Association,
average net demand deposits increased from

654

FEDEKAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

$2,262,969,000 for the week ending June 22,
Average excess reserves of the Boston
to $2,345,180,000 for the week ending August Clearing House banks, as measured by the
17. Their average cash holdings show the ratio of cash in vault and reserve balances
with the Federal Reserve Banks to net deposits,
following changes:
rose from $16,684,000 on July 21 (as against
$47,646,000 reported 3 months previous, when
Week endingbalances with approved reserve agents counted
Aug. 17.
June 22.
as reserve) to $17,291,000 on July 28, but
reached the low level of $14,896,000 on August
8118,615,000 $41,724,000
Gold
26,240,000 16,516,000 4, when the New York banks reported the
Legal tenders
32,134,000 25,331,000
Silver
For the week ending August 18
7,543,000 largest gain.
8,117,000
Bank notes and Federal Reserve notes
185,106,000 91,114,000 these reserve stood at $16,720,000, or slightly
above the level shown for the initial week.
Percentages, representing the ratio of net For the Philadelphia Clearing House banks
demand deposits, compared and trust companies a practically continuous
^Reserve situa- ^ ^ v a u l t ( ^ 1 ^ amounts due decline of excess reserves from $29,635,000 for
from Federal Reserve Banks, the week ending July 21 to $23,272,000 for the
and nonmember banks' balances with legal week ending August 18 is noted. As in the
depositaries, show a fluctuation of nearly 2 case of the Boston banks, excess reserves of the
per cent, falling from 20.7 per cent on July Philadelphia banks are obtained by deducting
21 to 18.7 per cent on August 18, with a maxi- required reserves against net deposits from
mum of 21.2 per cent on August 4. These balances with the Federal Reserve Banks comchanges follow heavy transfers of funds on bined with vault cash.
Government account from the interior to New
Notwithstanding large payments due from
York and the payment to the allied Governthe banks on August 15 on acc o u n t of t h e Libert
ments of large amounts which were immediy Loan-the
ately redeposited with New York Clearing
liquidation of Federal Reserve
House banks.
Bank investments, mainly of bills, noted last
Excess reserves of these banks (without month, continued unchecked, the total earning
counting the cash in the vaults of member assets on August 24 being 72 millions less than
banks) rose from $144,046,000 on July 21 to on July 20. Liquidation was most pronounced
$168,736,000 on August 4, and stood at at the New York and Chicago banks,
$76,456,000 on August 18. Computations of these two banks reporting net liquidation of
the New York State Banking Department bills in excess of 86.5 millions for the five weeks
made upon a somewhat different basis, show under review. At other cities, viz, Philadeleven smaller changes in the reserve condition phia, Cleveland, and Minneapolis, the strain
of the banks in Greater New York under its occasioned by the required payments on acjurisdiction. The State banks7 percentages count of the Liberty Loan produced substantial
varied between 25.6 per cent for the week end- increases in discount activities, resulting in
ing July 21 and 26.5 per cent for the week im- larger bill holdings on August 24 than on July
mediately following, and 23.7 per cent for the 20. The greatest decrease took place in the
week ending August 18. The reserve percent- holdings of collateral notes, the August figures,
age for the trust companies in Greater New $36,511,000, being $42,284,000 less than for
York rose from 21.1 per cent for the week end- July. Collateral notes secured by Liberty
ing July 21 to 24.4 per cent for the week fol- bonds or United States certificates of indebtedlowing and then gradually declined to 23.2 per ness show a decrease from $25,359,000 to
cent for the week ending August 18.
$8,362,000. Acceptances on hand decreased




from nearly 200 millions to about 150 millions
on August 10, since when a small increase to
159.6 millions has taken place. It should be
noted, however, that following the general
strengthening of commercial paper rates in the
New York market the local Federal Reserve
Bank on August 17 raised its acceptance rate
from 3 to 3J per cent. There has been no appreciable change in the aggregate holdings of
United States securities, the Federal Reserve
Banks having increased their bond holdings by
a small amount of Liberty bonds held temporarily pending allotment to ultimate purchasers
and, on the other hand, having disposed of
nearly all United States certificates of indebtedness acquired from time to time. None of
the banks report any important purchases of
municipal warrants, while liquidation continues, as the securities held fall due.
In the following table are shown the changes
between July 20 and August 24 in the amounts
of bills held by each of the Federal Reserve
Banks, also changes in the total amounts of
other classes of investments:
[In thousands of dollars; i. o., 000 omitted.]
Federal Reserve Bank.
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis.
Minneapolis
Kansas City
Dallas
San Francisco

July 20.
i $34,926
I 133,554
! 24,642
! 17,686
| 18,663
!
6,559
| 50,535
j
j
!
!

Total bills
Total U. S. securities
Total municipal warrants
Total investments held

Aug. 24. j

Net decrease.
$423
68,329

10,648
24,061
7,925
14,899
359, 111

! 75,315
j
2,186
i 436,612

For the past 5 weeks net exports of gold,
Gold shipments m a i n l y t o t h e Far East and to
and foreign ex- Spain, have continued on a
change.
large scale. These exports
were especially heavy during the weeks endingJuly 27 and August 3, when gold exports exceeded imports by $20,046,000 and $17,558,000,
respectively. The net outward movement of
7830—17




655

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

2

gold during the period was $55,012,000, gold
imports amounting to $18,248,000 and gold
exports to $73,260,000.
The net increase in the country's stock of
gold through net imports since August, 1914,
appears from the following exhibit:
Gold imports and exports into and from, the United States
from Aug. 1, 1914, to Aug. 17, 1917.
[000 omitted.]
Excess of
imports
over
exports.

j Imports.

Aug. 1 to Dec. 31,1914
Jan. 1 to Deo. 31,1915
.Tan. 1 to Dec. 31,1916
Jan. 1 to Aug. 17,1917
Total

i
i

:

!
!

S23,253
451,955
685,745
536,817

$104,972
31,426
155.793
293; 621

1381,719
420,529
529,952
243,196

1,697,770

585,812

1,111,958

1 Excess of exports over imports.

Continued reports to the effect that large
gold shipments were being effected led the
Board, on August 13, to address to all Federal
Reserve Banks a letter calling their attention
to the question of shipments of gold and of
remittances to foreign countries. Special attention was called to a letter received from the
Secretary of the Treasury, in which it wTas
stated that—
" I t seems important that close attention be
given to shipments of gold and to remittances
to foreign countries, and I am therefore requesting that the Federal Reserve Board communicate with the Federal Reserve Banks
urging that they keep in touch as closely as
possible with transactions of this character
and report them to the Board for my information as well as for the use of the Board."
It will be remembered that the Board, as
early as May 10, sent out to all Federal Reserve Banks a letter calling their attention to
the desire of the State Department that bankers
throughout the country be warned that they
should scrutinize most carefulfy every application made to them involving the transfer of
funds to neutral European countries wThich
seemed intended to give aid to the enemies of
this country, either directly or indirectly. Cir-

656

FEDERAL RESERVE BULLETIN.

culars have been sent by Federal Reserve Banks
to members again calling their attention to the
warning of M"ay 10, now emphasized by the
Board's letter of August 13. In transmitting
the communication of May 10, the Board
originally suggested that each banker doing
business in this country should scrutinize with
particular care such accounts as might be
held by his bank for any resident alien enemy,
and in the event any suspicious transactions
occurred in connection with such accounts,
that they be reported immediately to the
Board for transmission to the proper department.
The transactions which are interesting to
the State Department, it was then noted, may
be divided into three classes:
1. Foreign exchange transactions between
banks in this country and banks in neutral
countries in Europe.
2. Ordinary banking transactions such as
the obtaining of credits by alien enemies resident in the United States.
3. Banking transactions between this country and Mexico, or Central American and
South American countries.
The State Department is especially interested in preventing all transfers of monejr by
cable, by draft, or by shipments of currency
or otherwise to neutral countries in Europe
for the account of alien enemies.
A circular letter printed in this issue of the
Bulletin was transmitted by
Collection of
the Board, under date of Au"time items."
gust 11, to all Federal Reserve
Banks. In this the banks were requested to
establish general collection departments for
maturing notes and bills. This does not represent a new departure. As early as October,
1915, in a letter sent to all Federal Reserve
Agents, the Board ruled that Federal Reserve
Banks might and should collect maturing
notes and drafts, as well as coupons, on behalf
of their member banks, making such collections either from member or from nonmember
banks, as circumstances might require. The
matter has never heretofore become urgent,
due to the fact that during the life of the old




SEPTEMBER 1,1917.

reserve requirements city banks, acting as
11
reserve agents," performed these functions on
behalf of their correspondents in other places.
The period when no deposits except those in
reserve banks continue to be counted as reserves having arrived, it has been recognized
that there may be some hardship to the banks
of the country should they be required for
collection purposes to maintain balances with
city banks which have heretofore held their
reserves, in addition to the deposits required
by law to be carried in the reserve banks. The
occasion for establishing departments designed
for the collection of maturing notes and bills
is thus immediate, and the Board's letter
already referred to was intended as a recognition of this necessity on the part of member
banks generally. The present plan contemplates that every Federal Reserve Bank give
notice that it will undertake the collection of
maturing notes and bills which are payable
at any town or city where the Federal Reserve
Bank has satisfactory arrangements for collecting checks through banks, and that a
similar notice be sent to every other Federal
Reserve Bank that such collection will be made
for other Federal Reserve Banks on satisfactory
banking points in its own district. The banks
are to let it be known that these collections
will be made subject to the usual limitations
as to liability, the actual cost of collection to
be deducted when the proceeds are accounted
for, while for their protection they may exact
a moderate service charge. By recognizing in
its letter of August 11 the full authority of the
member banks to continue to ask reasonable
fees for the collection of maturing paper, the
Board merely places the facilities of the system
at the service of members in the further
development of a legitimate source of revenue.
The interpretation of the recent legislation of
Congress as applied to the colCheck collection ^ ,.
- , ,
, , „,
charges
lection oi checks and dralts
has evidently raised some difference of opinion among bankers and business
men, and the Board has frequently been asked
for an expression of its views on the subject.
This is contained in the letter of August 11,

SEPTEMBEB 1, 19.17.

FEDEKAL BESEKVE BULLETIN.

657

elsewhere published in this issue, and also in a
As noted in the last issue of the Bulletin, the
letter addressed to a Federal Reserve Bank
Board has been making a
under date of August 17, in which Gov. Hard- Trade acceptance general inquiry into the use of
ing expresses the following opinion:
inquiry.
acceptances by business houses
throughout the country. The
" 1 feel safe in saying that the construction of
the law as amended, and of the letter of August results now available show that the introduction of the trade acceptance is proceeding
11, may bo expressed briefly as follows:
" (1) Member banks must remit to Federal slowly. Under existing commercial practice
Reserve Banks at par for checks and drafts most trades have become habituated to the use
drawn on them.
of the so-called cash discount system. In ac" (2) Member banks may make a reasonable
charge against other banks and against their cordance with that system, buyers very gendepositors for any checks and drafts on banks erally draw upon a previously accumulated
received on deposit, the reasonableness of the bank balance or else furnish themselves with
charge to be determined by the Federal Re- the necessary funds by giving their local bankers
serve Board, and in no event to exceed one- their own notes, either with or without coltenth of 1 per cent.
" (3) There is a distinction between promis- lateral. Immediate payment made by the use
sory notes, bills of exchange, and drafts drawn of such funds is rewarded by the allowance of a
on individuals, firms, and corporations other substantial discount for this " cash" remittance.
than banks, and checks and drafts drawn on The "cash" has, however, as just noted, been
banks; and counsel advises the Board that the provided in many instances by local borrowing.
act does not appear to place any limitations With few exceptions the business houses of the
upon a charge that banks may impose for the
collection and remittances of promissory notes, country show themselves inclined to maintain
bills of exchange, and drafts drawn on indi- this system, sometimes adopting in conjuncviduals, firms, and corporations other than tion with it the plan of requiring acceptances
banks.;J
from those buyers who are not able, or for some
reason
do not choose, to take advantage of the
The application of this principle would mean
cash
discount,
liquidating their indebtedness
that reasonable charges up to, but not exceedat
maturity
without
discount. Trade accepting, one-tenth of 1 per cent might legally be
ances
are
thus,
in
many
cases, assuming a posimade by member banks for the collection by
tion
as
representatives
of
obligations incurred
them of checks drawn upon other banks.
by
concerns
which
find
it
easier or preferable
Member banks, however, can not exact from
to
be
carried
during
the
necessary
credit period
Federal Reserve Banks a charge for remitting
by
their
mercantile
creditors
rather
than by
for checks drawn upon themselves or sent to
banks.
The
problem
of
improving
the.comthem for collection by a Federal Reserve
Bank. In the past competition has tended in mercial paper of the country can not be solved
many places to prevent local institutions from in this way, but requires the adoption of
making such charges against their customers methods which will result in the substitution
except where agreements jointly entered into of discountable two-name paper for the main
and enforced were applied for the purpose of body of the "straight notes" which now repreprotecting or maintaining a charge upon sent the bulk of the commercial obligations of
certain classes of checks. The Federal Re- the Nation.
The problem must be solved by the business
serve Board has not yet formulated regulations
man rather than the banker.
to determine the charges which banks may
Solution of ac, •
• ,i ,
i
make against their customers, believing that ceptance problem. T^7 rhi a t 1S r e ( l m r e d3 is that each
action on the subject should be deferred til]
trade find a solution which will
there was a more general adherence to the be suited to its own requirements. It appears
principles of par remittance by nonmember as to the Board that between the cash-discount
well as member banks.
and the open-account sale there should be




658

FEDERAL RESERVE BULLETIN.

room for a special discount for sales against
trade acceptances and that this discount
should approach very nearly the discount
granted for cash sales. If business men will
attack the problem from this angle and the banks
will lend their aid by granting preferential
rates for trade acceptances the problem can
be worked out. A solution will be a gain for
the United States inasmuch as it will contribute to the healthy development and greater
strength of our banking structure. Acceptances, in order to fulfill their most important
mission, must be representative of the best
of mercantile credit; otherwise they will necessarily come to occupy- a secondary position as
the embodiment of the less fluid elements of
the country's business. There appears to be
a mistaken supposition in some quarters that
the mere conversion of the "open account"
into a trade acceptance renders the underlying
credit better than, or preferable to, the unsecured account. The Board has never contended that the use of the trade acceptance,
as such, could alter the character of the credit
underlying it, but only that the acceptance
method, involving as it did, the creation of
paper protected by two names, rendered the
paper more secure and more readily salable
than it otherwise would be. The essential
question is, however, in all cases the character
of the underlying credit itself, a question which
the local banker is in the best position to answer.
Acceptance of Drafts and Bills.
Inquiries and applications with respect to the
power to accept drafts and bills of exchange,
presented to Federal Reserve Board, have
raised the question whether the institutions
which had been authorized to accept up to 100
per cent prior to the passage of the act of September 7, 1916, from which provision for this
acceptance power was inadvertently omitted,
would be required to make application over
again under the amendments to the Federal
Reserve Act adopted June 21, 1917.




SEPTEMBER 1,1917.

It would appear that there is no doubt of the
authority of the banks which in the past have
been granted acceptance powers to continue
to exercise such powers without reapplication
involving action of the Board therein. In
order to make the situation certain, however,
the Board at a meeting held August 9, 1917,
adopted the following general resolution:
Be it resolved, That any member bank which
has heretofore applied for and received permission of the Federal Reserve Board to accept
drafts and bills of exchange in an amount not
to exceed 100 per cent of its capital and surplus, be, and it is hereby authorized and empowered under the authority of the act of June
21, 1917, to accept up to 100 per cent drafts
or bills of exchange drawn upon it having not
more than six months' sight to run, exclusive
of days of grace, which grow out of transactions involving the importation or exportation
of goods or which grow out of transactions
involving the domestic shipment of goods, provided shipping documents conveying or securing title are attached at the time of acceptance;
or which are secured at the time of acceptance
by a warehouse receipt or other such document
conveying or securing title covering readily
marketable staples.
The authority herein granted shall be effective from this date, subject, however, to
revocation by the Board at any time, upon 90
days' notice, as to any or all of the banks
which are subject to the provisions of this
resolution.
Resolved further, That a copy of this resolution be sent to each bank which has heretofore been granted permission by the Board to
accept such drafts and bills of exchange to an
amount not to exceed 100 per cent of its capital
and surplus.
Applications for power to accept drafts drawn
by banks and bankers in South American countries have been received from several institutions, and the Board has voted to permit drafts
drawn upon member banks by banks or bankers
in any Central or South American country for
the purposes specified in the Federal Reserve
Act, to be accepted by such member banks,
upon application to and approval by the Board.
Since the passage of the act amending the
Federal Reserve Act in June, the following

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN".

banks have been authorized to accept drafts
or bills of exchange up to 100 per cent of their
capital and surplus.
Blackstone Canal National Bank, Providence, R. I.
National Park Bank, New York City.
Citizens National Bank, New York City.
Girard National Bank, Philadelphia, Pa.
Union National Bank, Cleveland, Ohio.
Fifth-Third National Bank, Cincinnati, Ohio.
Farmers & Merchants National Bank, Baltimore, Md.
Murchison National Bank, Wilmington, N. C.
First National Bank, Danville, Va.
Norfolk National Bank, Norfolk, Va.
American National Bank, Richmond, Va.
National Bank of Savannah, Ga.
New Orleans National Bank, New Orleans, La.
First National Bank, Canton, Miss.
Tenison National Bank, Dallas, Tex.
First National Bank, Portland, Oreg.
Northwestern National Bank, Portland, Oreg.

659

Officers of the Federal Reserve Board.

The following press statement was issued by
the Board on August 10, 1917:
The President has redesignated W. P. G«
Harding as governor and Paul M. Warburg as
vice governor of the Federal Reserve Board for
the ensuing year.

State Banks Admitted.
The following State institutions have been
admitted to the Federal Reserve System during
the month of August: Norwood Trust Co., of
Norwood, Mass.; Iowa Loan & Trust Co., of
Des Moines, Iowa; State Bank of Chicago,
Chicago, 111.; Hibernia Bank & Trust Co., of
New Orleans, La.; Ottumwa Savings Bank
of Ottumwa, Iowa; State Bank of Evanston,
| 111.; Central State Bank, of Jackson, Mich.;
| Peoples Bank of Harrisonburg, Va.; Foreman
Loans to Cattle Raisers.
Bros. Banking Co. of Chicago, 111.; Fairview
The following letter was sent by the Board to State Bank of Fairview, Kans.; Peoples Bank
all Federal Reserve Banks under date of August I & Trust Company of Chase City, Va.; MerI chants Bank of Winona, Minn.; American
22:
! Trust Company of Boston, Mass.; Yellowstone
The Board has received a letter from the
Food Administrator, Mr. Hoover, stating that Valley Bank & Trust Company of Sidney,
he is just beginning a campaign to secure a Mont.; Peoples State Bank of Detroit, Mich.
larger amount of cattle feeding in this country, Seventy-seven State institutions are now memand that his investigation shows that the in- bers of the system, having a total capital of
terest charge represents between 35 and 40 per $59,465,700, total surplus of $60,525,965, and
cent of the total costs of this industry. The
legal rate of interest in many of the cattle- total resources of $1,173,795,038.
raising States is 8 per cent or more, and the
Food Administrator suggests that if banks
Cooperation of State Banks in New York.
would make loans to the cattle people at a rate
of interest not exceeding 7 per cent (which he
The following letter, sent out on August 10
thinks they can afford to do in view
of
the
5
per
by
the Federal Reserve Bank of New York,
cent rediscount rate on six months7 paper based states the situation with respect to banking
on live stock, available at most of the Federal cooperation in the control of gold:
Reserve Banks), a stimulus would be given to
DEAR SIR: The recent amendment to the
the cattle raising industry, which all will agree
is greatly needed at this time. The Board ap- Federal Reserve Act, reducing the reserve repreciates, of course, the limitations upon its quirements for member banks quite materially,
powers in this respect, and does not wish to put provides that they must carry all of the reany pressure upon the banks to induce them to quired reserve in the Federal Reserve Bank.
charge less than legal rates, but it is informing This leaves these banks free to carry as vaultyou of the suggestion made by Mr. Hoover in money any kind of United States coin or curorder that, should you deem it expedient, you rency, including Federal Reserve notes.
may point out to your member banks this opThe banking law of New York State has
portunity of rendering very effective help in the also recently been amended, permitting State
present food crisis.
banks and trust companies to count Federal




660

FEDERAL RESERVE BULLETIN.

Reserve notes as part of their vault reserves.
The banking laws of New Jersey and .Connecticut also permit Federal Reserve notes to be
counted as part of the vault reserve which
their State banks and trust companies are required to carry.
The way is now clear for mutual cooperation,
in the national interest, between the Federal
Reserve Bank of New York and the banking
institutions, both member and nonmember,
in its district, in respect to diverting to the
Federal Reserve Bank some of the gold and
gold certificates which are in general circulation among the people and lying idle in commercial tills and elsewhere, thus increasing its
strength and thereby the strength of every
banking institution in the district. It is estimated that there is over $500,000,000^ of gold
and gold certificates in general circulation, outside of the banks and the United States Treasury, and it is generally recognized that for this
class of circulation Federal Reserve notes (which
are redeemable in gold at the Treasury of the
United States) would serve equally well.
The Federal Reserve System was suddenly
called on during June to supply the large temporary expansion of credit required by member
and other banks in effecting the payments for
the first Liberty Loan, and it will doubtless
be similarly called upon, and probably to a
greater extent, in the forthcoming issue and in
other large financial operations incidental to
our participation in the war. The recent
expansion and subsequent contraction of
credit may be illustrated by the loans and discounts of the Federal Reserve Bank of New
York, which were $37,000,000 on June 1, 1917,
$252,000,000 on June 19, and $73,000,000 on
August 8. It is of importance to every bank
in the country that the gold suppfy—that is,
the credit power—of the Federal Reserve System should be strengthened by gradually replacing with Federal Reserve notes a considerable part of the gold now in general circulation outside of the banks, and that the
system should thus attain its maximum,
strength for the period of war financing upon
which we have entered.
Will you not, therefore, cooperate in this
movement by sorting out of your incoming cash
the gold certificates, not paying out an}^ such
certificates over your counter unless especially
requested, but instead, forwarding to this bank
all you may accumulate in excess of those you
think it advisable to carry as part of your vault
money? We will pay transportation charges




SEPTEMBER 1,1917.

on such gold certificates, whether fit or unfit
for circulation, and either (a) furnish you instead, free of expense, Federal Reserve notes
of such denominations as you may desire, or
(&) place the amount to your credit in this bank
or in any designated bank in New" York City.
A considerable number of member and other
banks have been cooperating with us along
the lines above suggested during the past year,
even though their reserve requirements were
such that Federal Reserve notes could not be
carried as part of their vault reserve. Now
that the conditions in this respect are so uniformly satisfaction, we trust that all of the
banks in this district will be willing to assist.
It will necessitate some little labor on your
part, but no added expense.
Will you please let us know whether we
may count on your cooperation in the manner
suggested ?
Very truly, yours,
R. H. TREMAN, Deputy Governor.

Development of the Collection System.

Questions raised by Federal Reserve Banks
and by member banks in connection with the
situation produced by the final transfer of
reserves have led the Federal Reserve Board to
give further attention to the development of
the existing system of collection and to take
action accordingly. Three steps have been
announced during the past month.
The first of these steps is the further expansion and improvement of the system already
in force for the collection of checks. On July
25 a letter, reading in part as follows, was
transmitted to ajl Federal Reserve Banks:
(1) For the time being, any Federal Reserve
Bank may, at its discretion, extend to each
member and clearing bank an exemption from
service charges upon a maximum of 250 checks
per month. The Board believes that this
exemption will encourage direct dealings on
the part of the smaller banks with their Federal
Reserve Bank.
(2) In cases where checks are not sent to
the Federal Reserve Banks but are sent direct
from one member bank to another for credit
of the sending bank on the books of the Federal
Reserve Bank, these transactions should be

SEPTEMBEK 1,

1017.

FEDERAL BESEBVE BULLETIN.

mutually agreeable to the banks concerned;
for the Board can not prevent the receiving
bank from making a reasonable charge (as
between banks) for the transfer as provided in
section 13 as amended. An opportunity is
afforded all member banks to clear their checks
at par by sending them to the Federal Reserve
Bank, if, for the purpose of saving time, or
for any other reason, a bank desires to send its
checks direct, it should make its own arrangements.
(3) As the Federal Reserve Act as amended
provides that no form of money in the vaults
of member banks can be counted as reserve, it
may be expected that their stock of gold and
lawful money will be diminished, and that
there will be a corresponding increase in their
stock of national bank notes and Federal Reserve notes. Therefore, pending the further
development of the clearing system, Federal
Reserve Banks should receive from banks which
are obliged to make shipments of cash to keep
their balances good, any form of United States
currency fit for circulation on the same terms
which have been heretofore extended to shipments of gold certificates and legal tenders.
In connection with the collection of maturing
notes and bills, to which reference was made in
the letter of July 19, the Board wishes to point
out that—
(4) Section 13 as amended permits a Federal
Reserve Bank to receive from member banks
for collection maturing notes and bills; and,
for purposes of exchange or of collection, from
other Federal Reserve Banks maturing notes
and bills, payable in its district; or, solely for
purposes of exchange or collection, from any
nonmember bank, maturing notes and bills.
Each Federal Reserve Bank, therefore, should
give notice that it will undertake the collection of maturing notes and bills which are
payable at any town or city where the Federal
Reserve Bank has satisfactory arrangements for
collecting checks through banks, and a similar
notice should be sent to every other Federal
Reserve Bank that such collection will be made
for other Federal Reserve Banks on satisfactory banking points in its own district.
The banks should announce that these collections will be made subject to the usual limitations as to liability, the actual cost of collection
to be deducted when the proceeds are accounted for, and for their protection may
exact a service charge of say 25 cents for each
unpaid item.




661

MATUHING NOTES AND BILLS.

It will be noted that in the latter part of the
foregoing communication the suggestion was
made that the collection not only of checks but
also of maturing notes and bills be undertaken.
Further elaboration of this recommendation
was subsequently undertaken in a letter dated
August 11, and transmitted to all Federal
Reserve Banks, in part as follows:
The Board deems it advisable that there
should be a thorough understanding on the
part of the Federal Reserve Banks and of the
member banks of its attitude in relation to the
collection of "maturing notes and bills," and
wishes to invite your attention to the distinction between the par clearing and collection
of checks and drafts drawn on member banks
and the collection of notes and drafts made by
or drawn upon individuals, firms, or corporations other than banks.
Section 13 of the Federal Reserve Act, as
amended by the act approved June 21, 1917,
says in part—
"Provided further, That nothing in this or
any other section of this act shall be construed
as prohibiting a member or nonmember bank
from making reasonable charges, to be determined and regulated by the Federal Reserve
Board, but in no case to exceed 10 cents per
$100 or fraction thereof, based on the total of
checks and drafts presented at any one time,
for collection or payment of checks and drafts
and remission therefor by exchange or otherwise; but no such charges shall be made against
the Federal Reserve Banks."
The question has been raised whether this
provision of the law would prohibit a member
bank from charging a Federal Reserve Bank
for collecting and remitting for a note or bill
of exchange forwarded to it by a Federal Reserve Bank for that purpose. In other words,
does this provision of the law apply to promissory notes and bills of exchange as well as to
checks and drafts on member banks? The
Federal Reserve Act in several sections clearly
distinguishes between "checks and drafts" on
the one hand and "notes and bills" on the
other. For instance, the first paragraph of
section 13 authorizes Federal Reserve Banks to
receive from member banks deposits of " checks
and drafts," without limiting the purpose for

662

FEDERAL RESERVE BULLETIN.

which the deposit must be made. The same
paragraph authorizes a Federal Reserve Bank
to receive "maturing notes and bills," but "for
collection" only. So, also, section 16 of the
act requires a Federal Reserve Bank to receive deposits of "checks and drafts drawn
upon any of its depositors" (i. e., upon member
banks and upon banks carrying balances with
Federal Reserve Banks), but nowhere is there
any requirement that "maturing notes and
bills" must be received at par, and it is obvious
that such items were eliminated for the reason
that no bank can properly be forced to credit
at par an unmatured or uncollected note or
bill. Not being in the nature of a cash item,
such an instrument is necessarily subject to a
discount. In other words, Congress in this
section distinguishes between the ordinary
check and bank draft, and the note and bill of
exchange.
With these lights before us, a proper construction of the so-called "Hardwick amendment" to section 13 which, in terms, provides
that "nothing in the act shall be construed as
prohibiting a member or nonmember bank
from making charges * * * for collection
or payment of checks and drafts and remission
therefor by exchange or otherwise, but no
such charges shall be made against the Federal
Reserve Banks" must necessarily draw a distinction between checks and drafts (on banks)
and promissory notes and bills of exchange.
Both the wording of this amendment and the
purpose for which it was enacted necessarily lead
to the conclusion that it was not intended to
prohibit a member bank from charging a
Federal Reserve Bank for services rendered in
collecting bills and notes which the Federal
Reserve Bank sends to it for that purpose.
The phrase, "but no such charges shall be
made against the Federal Reserve Banks" is
construed by the Board as being intended
solely for the purpose of preserving the check
clearing and collection system inaugurated by
the various Federal Reserve Banks; and there
was no intention, either express or implied, to
prohibit member banks or nonmember banks
from making reasonable charges against Federal Reserve Banks for services rendered in
collecting maturing notes and bills.
The Board holds, therefore, that charges for
transactions of this kind may be made now
with the same propriety as before the passage
of the act of June 21, 1917. Such charges
would seem to be permissible upon the hypothesis that notes and bills thus sent to a member




SEPTEMBER 1,1917.

bank by the Federal Reserve Bank for collection, are not drawn on the member bank, but
upon some third party; and it would be unreasonable and unfair to permit a Federal
Reserve Bank to select any particular member
or nonmember bank to act as its intermediary
or agent for the purpose of collecting and
remitting free of charge all of the notes and
bills held by it for collection and payable in any
particular city or locality. Such service must
be performed by the member or nonmember 4
bank only as a matter of contract, and not
because of any legal or moral obligation upon
such bank to make collections gratis for the
Federal Reserve Bank or for the banks for
whom it acts as agent.
In the case of "checks and drafts drawn
upon any of its depositors" (i. e., banks),
however, the law provides that no charge for
the service of collection, and payment and
remission by exchange or otherwise, should be
assessed against Federal Reserve Banks. The
Board holds that the reason for this is that
the Federal Reserve Banks arc affording all
member banks certain reciprocal advantages in
the collection and clearance of checks, and
because the Federal Reserve Banks are obligated to receive checks at par they may
properly expect remission therefor on the same
basis. In other words, the prohibition in the
Hardwick amendment relating to the charges
on the collection of checks and drafts on
banks for Federal Reserve Banks, is merely an
equalizing element in perfecting the check
collection system, which must afford reciprocal
privileges and advantages with the least possible expense to all concerned.
The paragraph of section 16 which immediately follows the one which requires Federal
Reserve Banks to receive on deposit checks at
par, authorities the Federal Reserve Board at
its discretion to exercise the functions of a
clearing house for Federal Reserve Banks, or
to designate a Federal Reserve Bank to exercise such functions, and to require each Federal
Reserve Bank to exercise the functions of a
clearing house for its member banks. In
clearing house cities checks on member banks
properly go to the clearing house, but promissory notes and drafts or bills of exchange
payable by third parties, are not sent to the
clearing house but are collected independently
by the holding bank.
For these reasons the Federal Reserve Board
is of the opinion that not only is it clear that
the Hardwick amendment does not apply to

SEPTEMBER 1,

the right of a member bank to charge the
Federal Reserve Bank for the service of collecting notes and bills of exchange, but also
that there is no sound reason or policy which
would require that the Federal Reserve Banks
should be immune from such a charge. While
the Board must insist upon a strict compliance
by the member banks with the law requiring
par collection of checks for Federal Reserve
Banks, it has no desire to deprive any bank of
any compensation allowed by the law and to
which the bank may be reasonably entitled.
Because of competition, banks are performing
many services free of charge which involve
them in expense and for which they are justly
entitled to remuneration.
In the opinion of the Board it should be the
aim of the Federal Reserve Banks in developing plans for
the collection of " maturing notes
and bills/ 7 to offer efficient service, but they
should be compensated and protected against
any abuse or expense in performing this service, and this principle applies, of course, to
member banks.
INTERPRETATION OF EXCHANGE AMENDMENT.

The third step in the Board's work on the
exchange situation during the month was also
taken in the letter of August 11, already
largely quoted above. The last paragraph
of that letter contained a ruling with respect
to the effect of the exchange amendment to
the act of June 21 in the following language:
It seems that some apprehension exists on
the part of many member banks that the
clearing of checks at par is but a prelude to
a requirement that they make no charge for
checks and drafts received by them for deposit
and credit, or for collection and remittance
from others than a Federal Reserve Bank. It
appears, however, that the provisions of the
so-called Hardwick amendment clearly preserve the right of any member bank to make
a reasonable charge against depositors or
banks other than Federal Reserve "Banks, not
to exceed one-tenth of 1 per cent, for such
services, the amount of such charge to be
determined and regulated by the Federal
Reserve Board.
New Issues of Treasury Certificates.
During the past month two issues of Government certificates of indebtedness bearing
3J per cent interest have been placed upon the
7830—17




663

FEDERAL RESERVE BULLETIN.

1917.

3

market by the Secretary of the Treasury. The
first issue, amounting to $300,000,000, was
offered to the banks on July 31, while the
second, amounting to $250,000,000, was offered
on August 20. The conditions and circumstances surrounding these issues have been
explained in statements made public by the
Secretary of the Treasury on July 31 and
August 19, as follows:
JULY 31,

1917.

Secretary McAdoo has decided to resume
offerings of United States Treasury certificates
of indebtedness in order to provide funds to
meet the requirements of tne United States
for its own expenditures and for its advances
to foreign Governments at war with the German
Government.
The Secretary now offers for subscription at
par (through the Federal Reserve Banks)
$300,000,000 Treasury certificates of indebtedness, payable November 15, 1917, with interest
at the rate of 3 | per cent per annum from August 9, 1917. Subscriptions will be received
at Federal Reserve Banks until 3 p. m., August
7, their local time. Payment for certificates
allotted must be made on August 9 to that
Federal Reserve Bank through which subscription may have been made. The right is reserved
to reject any subscription and to allot less than
the amount'of certificates applied for. Interim
certificates may be delivered in the first instance, which will be exchangeable for the
definitive certificates of indebtedness when
prepared. Certificates will be in denominations of $1,000, $5;000, §10,000, and $100,000.
The act of Congress approved April 24, 1917,
provides that these certificates shall be exempt,
both as to principal and interest, from all
taxation, except estate or inheritance taxes,
imposed by authority of the United States
or its possessions, or by any State or local
taxing authority. Upon 10 days' notice, given
in such manner as may be determined by
the Secretary of the Treasury, the series
of $300,000,000 certificates now offered may
be redeemed as a whole, at par and accrued interest, on or after the date set for
the payment of the first installment, payable
after allotment, of the subscription price of
any bonds offered for subscription by the
United States hereafter and before the maturity of the certificates. The certificates of
this series, whether or not called for redemption, will be accepted at par, with an adjustment of accrued interest, if tendered on said

664

FEDERAL RESERVE BULLETIN".

installment date as payment on the purchase
price of any such bonds issued and allotted
hereafter and before the maturity of the certificates.
AUGUST 19,

1917.

Secretary McAdoo offers for subscription at
par (through the Federal Reserve Banks)
$250,000,000 of Treasury certificates of indebtedness payable on November 30, 1917,
with interest at the rate of 3|- per cent per
annum from August 28, 1917. Subscriptions
will be received at the Federal Reserve Banks
until 12 o'clock noon, August 25, 1917, their
local time.
Payment for certificates allotted must be
made on August 28, 1917, to that Federal
Reserve Bank through which subscription may
have been made. The right is reserved to reject any subscription and to allot less than the
amount of certificates applied for. Interim
certificates ma}^ be delivered in the first instance, which will be exchangeable for the
definitive certificates of indebtedness when prepared. Certificates will be in denominations
of $1,000, $5,000, $10,000, and $100,000.
The act of Congress approved April 24, 1917,
provides that these certificates shall be exempt,
both as to principal and interest, from all taxation, except estate or inheritance taxes, imposed by authority of the United States, or its
possessions, or by any State or local taxing
authority.
Upon 10 day's7 notice given in such manner
as may be determined by the Secretary of the
Treasury, the series of $250,000,000 certificates
now offered may be redeemed as a whole, at
par and accrued interest, on or after the date
set for the payment of the first installment,
payable after allotment, of the subscription
price of any bonds offered for subscription by
the United States hereafter and before the
maturity of the certificates. The certificates of
this series, whether or not called for redemption, will be accepted at par, with an adjustment of accrued interest, if tendered on said
installment date as payment on the purchase
price of any such bonds issued and allotted
hereafter and before the maturity of the
certificates.
In connection with the foregoing offering of
the second issue of certificates of indebtedness
of the United States preparatory to the second
issue of the Liberty Loan, the Secretary of the
Treasury announces that the proceeds of these
certificates mil be deposited with incorporated
banks and trust companies as nearly asmaybe




SEPTEMBER 1,1917.

in proportion to the subscriptions for certificates of indebtedness of this issue made by
and through them respectively, provided, that
such subscribing banks and trust companies
make application for such deposits and qualify
therefor, all substantially in accordance with
the procedure laid down in connection with
the deposit of the proceeds of Liberty Bonds,
and upon the same terms and conditions.
Such deposits will be left as long as the requirements of the Government7 permit, and whenever practicable five days notice will be given
before withdrawal. It is expected that certificates of indebtedness will be issued from
time to time somewhat in advance of the immediate requirements of the United States.
The pnmar}^ object of this is to avoid the
financial stress which would result from the
concentration of the payments for a great bond
issue upon a single day (which can not be
avoided wholly by provision for payment by
installments as a great proportion of subscribers prefer to make payment in full on one
day as a matter of convenience). Those who
acquire certificates of indebtedness, in advance
of the bond issue, gradually, without disturbing the money position, purchase exchange
payable where the bond subscriptions must be
paid (that is, at the Federal Reserve Banks),
in advance of the date when the payment is
to be made, and meanwhile secure a substantial
return upon their money.

Growth of the Acceptance Business.

Data presented below indicate to some extent the increase in the volume of acceptances
outstanding since the publication of similar
figures in the May, 1917, Bulletin. During
the period between March 5 and June 20, 1917,
the liabilities of national banks on account of
acceptances increased from $101,485,000 to
$144,414,000, or $42,929,000, the greater portion of the increase, or $33,865,000, occurring
between May 1 and June 20.
Acceptance liabilities shown for the national
banks of Chicago increased about 127 per cent
between March 5 and June 20, and those of
San Francisco about 97 per cent, while the
national banks in Greater New York and
Boston report increases of about 57 and 40 per
cent, respectively. Both Cleveland and Cin-

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

665

cinnati report acceptances in some volume for | agencies of foreign banks for which no data are
the first time on June 20. The net increase for available, these institutions making no public
all national banks during the period under con- reports of their condition.
Bankeers' acceptances held by the Federal
sideration was over 42 per cent.
During the same period the acceptance Reserve Banks on March 5, as shown by data
liabilities of trust companies in Greater New compiled from reports received by the Federal
York show a decrease of $7,755,000, and are Reserve Board, aggregated nearly 108 millions,
given as $94,485,000 on June 20. On the of which 20.6 millions represented acceptance
other hand, the trust companies of Boston liabilities of private banking institutions. On
show an increase from $6,506,000 on March 5 June 25 the holdings of the Federal Reserve
to $16,979,000 on June 20, or nearly 10.5 Banks had increased to over 196 millions, 31.2
millions of which represented acceptances of
million dollars.
private banks and 3.2 millions acceptances of
Acceptance liabilities of national banks in principal cities of
American branches and agencies of foreign
the United States on specified dates.
banks.
[In thousands of dollars; i. e., 000 omitted.]
No definite data are obtainable regarding the
volume of nonmember bank acceptances outMar. 5,
May 1, June 20,
1917.
1917.
1917.
standing other than those shown in the above
table, and the figures giving the distribution
New York
50,720
56,808
79,473
Boston
21,835
30,681 of the acceptance holdings of the Federal Re23,439
Philadelphia
8,513
8,849
6,154
Cleveland
1,494 serve Banks distributed by accepting institu70
270
Cincinnati
1,578
22
23
Baltimore
1,966 tions, as published on page 718.
463
2,755
1,394
New Orleans
1,962
1,239
660
Charleston, S. C.
1,300
1,093
The total amount of acceptance liabilities
3,357
Chicago
967
1,480
1,468 given in the above table, plus the amount of
Minneapolis
6,072
4,272
5,646
3,861
San Francisco
2,869
8,184 acceptances of private banks and American
7,868
Allother
7,643
Total
101,485 110,549
144,414 branches and agencies of foreign banks held by
the Federal Reserve Banks on June 20, aggreAvailable data regarding acceptance liabili- gate about $294,000,000. It is, therefore,
ties of American banking institutions on dates probable that the total acceptance liabilities
of the last three calls for condition statements of all banking institutions in the United
made by the Comptroller of the Currency are States, on June 20, 1917, were not less than
$350,000,000.
as follows:
[In thousands of dollars; i. e., 000 omitted.]

Condition of National Banks.
Mar. 5,
1917.

May 1,
1917.

June 20,
1917.

The 'condition of national banks on June 20,
1917,
the last report which will be made by
110,549
Feb. 28,
national banks under the old reserve require1917.
Trust companies in Greater New York.. 102,240
94,485 ments, was announced by the Comptroller of
(*)
State banks in Greater New York
6,546
5,957
<l)
Trust companies in Boston
6,506 2 10,823
16,979 the Currency on August 1, as follows:
Mar. 5,
1917.
Resources aggregated $16,151,000,000, which
State banks and trust companies in
3,330
1,765 is §6,637,000 ahead of the resources of May 1,
Baltimore
1,825
Total
220,107
263,600 1917, the greatest ever reported up to that
time. The increase in total resources as com2 Old Colony Trust Co. figures only.
i No data available.
pared with June 30, 1916, was $2,224,000,000.
Total deposits June 20, 1917, were 12,769
It will be noted that the above figures do millions, a reduction of 306 millions as comnot include any acceptances of the large private pared with May 1, 1917, but an increase of
banking institutions or American branches and 1,913 millions as compared with June 30, 1916.
All national banks .




101,485

144,414

666

FEDEEAL RESERVE BULLETIN.

Loans and discounts were $8,818,000,000
an increase over May 1 of 66 millions and an
increase over June 30, 1916, of $1,139,000,000.
United States bonds were reported at
905 millions, an increase since May 1, 1917, of
137 millions, and an increase since June 30,
1916, of 174 millions. The national banks also
report an additional amount of $171,000,000
paid on account of subscriptions to Liberty
bonds.
Specie and legal tenders on hand plus balance in Federal Reserve Banks amounted to
$1,482,000,000, a decrease as compared with
May 1, 1917, of 43 millions, but an increase
since June 30, 1916, of $248,000,000.
Bonds and securities other than Government's were reported at 1,843 millions, a reduction as compared with May 1, 1917, of 14
millions, and an increase since June 30, 1916,
of $315,000,000.
Amount due from banks other than Federal
Reserve Banks was 1,637 millions, a decrease
as compared with May 1, 1917, of 201 millions,
and an increase of 99 millions as compared
with June 30, 1916.
Amount due to banks and bankers was
$3,025,000,000, a reduction of 353 millions
since May 1, 1917, but an increase of 312
millions since June 30, 1916.
Bills payable and rediscounts were $371,000,000, an increase as compared with May 1,
1917, of $278,000,000, and an increase as
compared with June 30, 1916, of $303,000,000.
This increase was due to the temporary financing incident to the negotiation of the Liberty
bond issue.
The call of June 20, 1917, was the last which
will be made under the old reserve requirements. The new law recently passed requires
all national-bank reserves to be carried with
the twelve Federal Reserve banks.
The total reserve held June 20, 1917, was
$2,310,000,000, a reduction as compared with
May 1, 1917, of $163,000,000, and an increase i
as compared with June 30, 1916, of $234,000,000. The percentage of total reserve to
deposits June 30, 1917, was 22.91 as compared
with 24.05 per cent May 1, 1917, and with
23.86 per cent June 30, 1916.
The surplus reserve ^ver and above the
amount required on June 20, 1917, was
$842,000,000, a reduction as compared with
May 1, 1917, of $132,000,000, and an increase
as compared with June 30,1916, of $41,000,000.
The total reserve carried in vaults and with
Federal Reserve banks June 20, 1917, was




SEPTEMBER 1,1917.

$1,482,000,000, which was $14,000,000 in
excess of the total amount of reserve required,
therefore the banks on the date mentioned
held in their vaults and with Federal Reserve
banks $14,000,000 more than the amount required in addition to the $828,000,000 reserve
carried with the Reserve Agents.
On June 20, 1917, the central reserve cities
held 19.70 per cent of reserve against a required reserve of 18 per cent. Other reserve
cities held 22.45 per cent against a requirement
of 15 per cent, while the country banks, which
were only required to carry 12 per cent, held on
June 20, 1917, a reserve of 25.33 per cent of
their net deposits.
Permissive Membership in Pennsylvania.
The Legislature of Pennsylvania has passed
the following act permitting State institutions
to become members of the Federal Reserve
System:
An act authorizing any bank or trust company incorporated under the laws of this Commonwealth to become a member of a Federal Reserve Bank, and in such
event to be subject to all the provisions of the act of
Congress known as the Federal Reserve Act; allowing
any such bank or trust company to comply with the
reserve requirements of such act in lieu of those established by the laws of this Commonwealth; and permitting
the commissioner of banking to accept the examinations
and audits made pursuant to such act in lieu of those
required by the laws of this Commonwealth.
SECTION 1. Be it enacted by the Senate and
House of Representatives of the Commonwealth
of Pennsylvania in General Assembly met, and
it is hereby enacted by the authority of the same,
That any bank or trust company incorporated under the laws of this Commonwealth
shall have the power to subscribe to the capital
stock and become a member of a Federal
Reserve Bank created and organized under an
act of the Congress of the United States approved tho twenty-third day of December,
anno Domini one thousand nine hundred and
thirteen; and known as the Federal Reserve
Act,
SEC. 2. Any bank or trust company, incorporated under the laws of this Commonwealth,
which shall become a member of a Federal
Reserve Bank, shall be subject to all the provisions of the Federal Reserve Act and its
amendments, and to the regulations of the
Federal Reserve Board applicable to such
bank or trust company, and shall have all the

SEPTEMBER 1, 1917.

powers and assume all the liabilities conferred
and imposed by said act.
SEC. 3. Any such bank or trust company
shall comply with the reserve requirements of
the Federal Reserve Act and its amendments,
and the compliance of such bank or trust
company therewith shall be in lieu of, and shall
relieve such bank or trust company from,
compliance with the provisions of the laws
of this Commonwealth relating to the maintenance of reserves.
SEC. 4. Any such bank or trust company
shall be subject to the examinations required
under the terms of the Federal Reserve Act,
and the commissioner of banking may, in his
discretion, accept such examinations in lieu
of the examinations required under the laws
of this Commonwealth.
SEC. 5. All acts and parts of acts inconsistent herewith are hereby repealed.
Approved, July 17, 1917.
Notes Issued During 1917.
The Comptroller of the Currency on August
9 made the following statement as to the national-bank notes and Federal Reserve notes
issued and redeemed through his office during
the fiscal year ending June 30, 1917, and also
showing the amount of notes of each class in the
Treasury vaults June 30, 1917, and the amount
of notes outstanding in the hands of the public
on the same date:
Total amount of national-bank notes and
Federal Reserve notes issued through the
Office of the Comptroller of the Currency
during the fiscal year ending June 30,
1917
§958,441,130
Amount redeemed and destroyed through
Office of Comptroller of the Currency
during same period
459, 576, 390
Total amount of notes outstanding June 30,
1917
1, 262, 827, 970
Total amount new notes in vaults June 30,
1917
1048,170,460

The large increase (§371,239,510) in the
amount of Federal Reserve notes outstanding
is due mainly to the issuance of Federal Reserve notes against the deposit of gold or gold
certificates with the Federal Reserve agents,




667

FEDERAL RESERVE BULLETIN.

amount so held June 30, 1917, being approximately $400,000,000.
The figures as to the engraving, issue, and
redemption and amount outstanding of national-bank notes and Federal Reserve notes
separately for the year ending June 30, 1917,
are as follows:

New notes printed and delivered by the
Bureau of Engraving and Printing from
June 30,1916. to June 30,1917
Notes issued by Comptroller's Office 3une
30,1916, to June 30,1917
Notes redeemed and destroyed through
Comptroller's Office from June 30, 1916,
to June 30,1917
Excess of notes redeemed and destroyed
June 30, 1916, to June 30, 1917, over
amount issued during same period
I
Excess of notes issued, June 30, 1916, to
June 30,1917, over amount redeemed and i
destroyed, same period
I
Total amount of new notes in vault June 30,
1917
Eeduction during the year in nationalbank notes in vault of
Increase during the same period in Federal
Reserve notes in vault of
Total amount of notes outstanding Juno 30,
1917
Reduction during the year in national-bank
notes outstanding of
Increase during the same period in Federal
Reserve notes outstanding, of

Nationalbank notes.

Federal Reserve notes.

$289,562,470

$968,820,000

328,961,130

629,480,000

357,359,750

102,216,640

28,398,620
527,263,360
383,430,460

661,740,000

52,118,430
192,260,000
715,420,010

547,407,960

28,754,650
371,239,510

Why a Southern State Institution Has Entered
the Federal Reserve System.
The Hibernia Bank & Trust Co., the largest
State bank and trust company in the South,
has been admitted to membership in the
Federal Reserve System. In this connection,
President John J. Gannon issued the following
statement explaining the reasons why the
bank has entered the system:
"When the Federal Reserve Act first became effective three years ago we seriously considered the advisability of joining the system
but at that time conditions were such that
membership in the system would have interfered to some extent with the privileges which
we enjoy as a State bank and trust company,
and we, therefore, postponed action until a
later date.
"In view of the fact that recent amendments to the Federal Reserve Act eliminated
all of these obstacles, our board of directors
again considered the question last month with
the result that we filed our application for
membership several weeks ago.

668

FEDERAL RESERVE BULLETIN.

"The Federal Reserve Board promptly sent
its representatives to have the customary examination made, and upon their favorable report, which was filed this week, we were notified by wire to-day that we had been admitted
to full membership in the Federal Reserve
System.
"Our primary motive in applying for membership in the s}rstem at this time is our sense
of duty to our country, because we believe
that under the existing extraordinary conditions it is very important that we should have
a strong and unified banking system.
"The Federal Reserve System has already
demonstrated its great value to our Nation
during the short time of its existence, but in
our opinion the cooperation of the larger State
banks in the reserve and central reserve cities
will be necessary if the system is to become
the bulwark of financial strength which it
should be and which we will need to keep
business on an even keel, especially for the
duration of the war and the period of readjustment which will follow.
"We have felt, therefore, that by joining
the system now we are in a measure enlisting
our resources in the Nation's cause, and are
thus contributing our share to the strength and
stability of the financial condition of the
country.
"Another consideration which prompted us
to take this step at this time is the fact that
under the amended law we will not only retain
all of our charter rights as a State bank and
trust company granted under the laws of the
State of Louisiana, but, in addition we will
now enjoy all of the privileges and facilities
which membership in the Federal Reserve
System affords.
"Among the most important of these added
privileges and facilities is the right to rediscount and the consequent ability to obtain
whatever amount of currency may be needed
at any time. Of course this access to the resources of the Federal Reserve System is not
very important under ordinary conditions, but
it becomes of inestimable value to even the
strongest bank in times of financial stress.
"Moreover, New Orleans is rapidly becoming a commercial and financial center of the
first magnitude, and we believe that as members of the Federal Reserve System we will be




SEPTEMBER 1,1917.

in a better position to give every possible assistance in the development of the commercial
possibilities of this section."
Description of Federal Reserve Districts.

Below are furnished descriptions of the 12
Federal Reserve districts, accompanied by estimates of the population of each district, recently prepared by the Bureau of the Census
for use of investigators at work on the Liberty
Loan. No detailed description of Federal Reserve districts has been issued since the Organization Committee completed its work about
three and one-half years ago.
DISTRICT NO. 1—BOSTON (6,963,987).
CONNECTICUT (except Fairfield County) (975,434).
MAINE (777,340).
MASSACHUSETTS (3,775,973).
NEW HAMPSHIRE (444,429).
RHODE ISLAND (625,865).
VERMONT (364,946).

DISTRICT NO. 2—NEW YORK (13,111,816).
CONNECTICUT (county of Fairfield) (289,939).
NEW JERSEY (counties of Monmouth, Middlesex, Hunter-

don, Somerset, Union, Essex, Passaic, Hudson, Bergen,
Morris, Sussex, and Warren) (2,361,695).
NEW YORK (10,460,182).

DISTRICT NO. 3—PHILADELPHIA (6,632,611).
DELAWARE (215,160).

NEW JERSEY (except counties enumerated under District

No. 2) (652,499).
PENNSYLVANIA (eastern part) (5,764,952). Counties:
Adams.
Bedford.
Berks.
Blair.
Bradford.
Bucks.
Cambria.
Cameron.
Carbon.
Center.
Chester.
Clearfield.
Clinton.
Columbia.
Cumberland.
Dauphin.

Delaware.
Elk.
Franklin.
Fulton.
Huntingdon.
Juniata.
Lackawanna.
Lancaster.
Lebanon.
Lehigh.
Luzerne.
Ly coming.
McKean.
Mifflin.
Monroe.
Montgomery.

Montour.
Northampton.
Northumberland
Perry.
Philadelphia.
Pike.
Potter.
Schuylkill.
Snyder.
Sullivan.
Susquehanna.
Tioga.
Union.
Wayne.
Wyoming.
York.

DISTRICT NO. 4—CLEVELAND (9,314,762).
KENTUCKY (eastern part) (1,039,880).

Counties:

Bath.
Bell.
Boone.
Bourbon.
Boyd.
Bracken.
Breathitt.
Campbell.
Carter.
Clark.
Clay.
Elliott.
Estill.
Fayette.
Fleming.
Floyd.
Garrard.
Grant.
Greenup.

Mason.
Menifeo.
Montgomery
Morgan.
Nicholas.
Owsley.
Pendleton.
Perry.
Pike.
Powell.
Pulaski.
Robertson.
Itockcastle.
Rowan.
Scott.
Whitley.
Wolfe.
Woodford.

Harlan.
Harrison.
Jackson.
Jessamine.
Johnson.
Kenton.
Knott.
Knox.
Laurel.
Lawrence.
Lee.
Leslie.
Letcher.
Lewis.
Lincoln.
McCreary.
Madison.
Magoflin.
Martin.

OHIO (5,212,085).

PENNSYLVANIA (western part) (2,895,090). Counties:
Alleghany.
Armstrong.
Beaver.
Butler.
Clarion.
Crawford.
Erie.

Fayette.
Forest.
Greene.
Indiana.
Jefferson.
Lawrence.
Mercer.

Somerset.
Venango.
Warren.
Washington.
Westmoreland.

WEST VIRGINIA (northern part) (167,707). Counties:
Brooke.
Hancock.

Marshall.
Ohio.

Tyler.
Wetzel.

DISTRICT NO. 5—RICHMOND (9,278*461).
DISTRICT OF COLUMBIA (369,282).
MARYLAND (1,373,673).
NORTH CAROLINA (2,434,381).
SOUTH CAROLINA (1,643,205).
VIRGINIA (2,213,025).

WEST VIRGINIA (all counties except Brooke, Hancock,
Marshall, Ohio, Tyler, and Wetzel) (1,244,895).
DISTRICT NO. 6—ATLANTA (10,055,640).
ALABAMA (2,363,939).
FLORIDA (916,185).
GEORGIA (2,895,841).

LOUISIANA (southern part) (1,260,490). Parishes:
Acadia.
Allen.
Ascension.
Assumption.
Avoyelles.
Calcasieu.
Cameron.
East Baton Rouge.
East Feliciana.
Evangeline.
Iberville.
Iberia.
Jefferson.




669

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917.

Jefferson Davis.
Lafayette.
Lafourche.
Livingston.
Orleans.
Plaquemines.
Pointe Coupee.
Rapides.
St. Bernard.
St. Charles.
St. Helena.
St. James.

St. John the Baptist.
St. Landry.
St. Martin.
St. Mary.
St. Tammany.
Tangipahoa.
Terrebonne.
Vermilion.
Vernon.
Washington.
West Baton Rouge.
West Feliciana.

MISSISSIPPI
Adams.
Amite.
Claiborne.
Clarke.
Copiah.
Covington.
Forrest.
Franklin.
George.
Greene.
Hancock.
Harrison.
Hinds.
Issaquena.
TENNESSEE
Anderson.
Bedford.
Bledsoe.
Blount.
Bradley.
Campbell.
Cannon.
Carter.
Cheatham.
Claiborne.
Clay.
Cocke.
Coffee.
Cumberland.
Davidson.
Dekalb.
Dickson.
Fen tress.
Franklin.
Giles.
Grainger.
Greene.
Grundy.
Hamblen.
Hamilton.

(southern part) (996,935). Counties:
Jackson.
Jasper.
Jefferson.
Jefferson Davis.
Jones.
Kemper.
Lamar.
Lauderdale.
Lawrence.
Leake.
Lincoln.
Madison.
Marion.
Neshoba.

Newtoa.
Pearl River.
Perry.
Pike.
Rankin.
Scott.
Sharkey.
Simpson.
Smith.
Walthall.
Warren.
Wayne.
Wilkinson.
Yazoo.

(eastern part) (1,622,250). Counties:
Hancock.
Hawkins.
Hickman.
Houston.
Humphreys.
Jackson.
James.
Jefferson.
Johnson.
Knox.
Lawrence.
Lewis.
Lincoln.
Loudon.
McMinn.
Macon.
Marion.
Marshall.
Maury.
Meigs.
Monroe.
Montgomery.
Moore.
Morgan.
Overton.

Perry.
Pickett.
Polk.
Putnam.
Rhea.
Roane.
Robertson.
Rutherford.
Scott.
Sequatchie.
Sevier.
Smith.
Stewart.
Sullivan.
Sumner.
Trousdale.
Unicoi.
Union.
Van Buren.
Warren.
Washington
Wayne.
White.
Williamson.
Wilson.

DISTRICT NO. 7—CHICAGO (14,154,175).
ILLINOIS (northern part) (4,977,386). Counties:
Boone.
Bureau.
Carroll.
Cass.
Champaign.
Christian.
Clark.
Coles.
Cook.
Cumberland.
Dekalb.
Dowitt.
Douglas.
Dupage.
Edgar.
Ford.
Fulton.
Grundy.
Hancock.
Henderson.

Henry.
Iroquois.
Jo Daviess.
Kane.
Kankakee.
Kendall.
Knox.
Lake.
La Salle.
Lee.
Livingston.
Logan.
McDonough.
McHenry.
McLean.
Macon.
Marshall.
Mason.
Menard.

Mercer.
Moultrie.
Ogle.
Peoria.
Piatt.
Putnam.
Rock Island
Sangamon.
Schuyler.
Shelby.
Stark.
Stephenson.
Tazewell.
Vermilion.
Warren.
Whiteside.
Will.
Winnebago.
Woodford.

670

FEDERAL RESERVE BULLETIN.

INDIANA (northern part) (2,227,340).
Adams.
xillen.
Bartholomew.
Benton.
Blackford.
Boone.
Brown.
Carroll.
Cass.
Clay.
Clinton.
Dearborn.
Decatur.
Dekalb.
Delaware.
Elkhart.
Fayette.
Fountain.
Franklin.
Fulton.
Grant.
Hamilton.
Hancock.

Hendricks.
Henry.
Howard.
Huntington.
Jasper.
Jay.
Jennings.
Johnson.
Kosciusko.
Lagrange.
Lake.
Laporte.
Madison.
Marion.
Marshall.
Miami.
Monroe.
Montgomery.
Morgan.
Newton.
Noble.
Ohio.
Owen.

Counties:
Parke.
Porter.
Pulaski.
Putnam.
Randolph.
Ripley.
Rush.
St. Joseph.
Shelby.
Starke.
Steuben.
Tippecanoe.
Tipton.
Union.
Vermilion.
Vigo.
Wabash.
Warren.
Wayne.
Wells.
White.
Whitley.

IOWA (2,224,771).
MICHIGAN (southern part) (2,721,733) .
Alcona.
Allegan.
Alpena.
Antrim.
Arenac.
Barry.
Bay.
Benzie.
Berrien.
Branch.
Calhoun.
Cass.
Charlevoix,
Cheboygan.
Claire.
Clinton.
Crawford.
Eaton.
Emmet.
Genesee.
Gladwin.
Grand Traverse.
Gratiot.

Hillsdale.
Huron.
Ingham.
Ionia.
Iosco.
Isabella.
Jackson.
Kalamazoo.
Kalkaska.
Kent.
Lake.
Lapeer.
Leelanau.
Lenawee.
Livingston.
Macomb.
Manistee.
Mason.
Mecosta.
Midland.
Missaukee.
Monroe.
Montcalm.

Counties:
Montmorency.
Muskegon.
Newaygo.
Oakland.
Oceana.
Ogenaw.
Osceola.
Oscoda.
Otsego.
Ottawa.
Presque Isle.
Roscommon.
Saginaw.
St. Clair.
St. Joseph.
Sanilac.
Shiawasee.
Tuscola.
Van Buren.
Washtenaw.
Wayne.
Wexford.

WISCONSIN (southern part) (2,002,945).
Adams.
Brown.
Calumet.
Clark.
Columbia.
Crawford.
Dane.
Dodge.
Door.
Fond du Lac.
Grant.
Green.
Green Lake.
Iowa.
Jackson.




Jefferson.
Juneau.
Kenosha.
Kewaunee.
Lafayette.
Langlade.
Manitowoc.
Marathon.
Marinette.
Marquette.
Milwaukee.
Monroe.
Oconto.
Outagamie.
Ozaukee.

Counties:

Portage.
Racine.
Richland.
Rock.
Sauk.
Shawano.
Sheboygan.
Vernon.
Walworth.
Washington.
Waukesha.
Waupaca.
Waushara.
Winnebago.
Wood.

SEPTEMBER 1,1917.

DISTRICT NO. 8—ST. LOUIS (9,291,698).
ARKANSAS (1,766,343).

Counties:

ILLINOIS (southern part) (1,257,609).
Hardin.
Jackson.
Jasper.
Jefferson.
Jersey.
Johnson.
Lawrence.
Macoupin.
Madison.
Marion.
Massac,
Monroe.
Montgomery.
Morgan.
Perry.

Pike.
Pope.
Pulaski.
•Randolph.
Richland.
St. Clair.
Saline.
Scott.
Union.
Wabash.
Washington.
Wayne.
White.
Williamson.

Adams.
Alexander.
Bond.
Brown.
Calhoun.
Clay.
Clinton.
Crawford.
Edwards.
Eflingham.
Fayette.
Franklin.
Gallatin.
Greene.
Hamilton.

INDIANA (southern part) (608,152).
Jackson.
Clark.
Jefferson.
Crawford.
Knox.
Daviess.
Lawrence.
DuboisMartin.
Floyd.
Orange.
Gibson.
Perry.
Greene.
Pike.
Harrison.

Counties:

KENTUCKY (western part) (1,354,213)
Gallatin.
Adair.
Graves.
Allen.
Anderson.
Grayson.
Ballard.
Greene.
Hancock.
Barren.
Hardin.
Boyle.
Hart.
Breckenridge.
Henderson.
Bullitt.
Henry.
Butler.
Hickman.
Caldwell.
Hopkins.
Calloway.
Jefferson.
Carlisle.
Larue.
Carroll.
Livingston.
Casey.
Logan.
Christian.
Lyon.
Clinton.
McCracken.
Crittenden.
McLean.
Cumberland.
Marion.
Daviess.
Marshall.
Edmonson.
Franklin.
Meade.
Fulton.
Mercer.
MISSISSIPPI (northern part) (979,635).
Alcorn.
Itawamba.
Attala.
Lafayette.
Benton.
Lee.
Bolivar.
Leflore.
Calhoun.
Lowndes.
Carroll.
Marshall.
Chickasaw.
Monroe.
Choctaw.
Montgomery.
Clay.
Noxubee.
Ooahoma.
Oktibbeha.
De Soto.
Panola.
Grenada.
Pontotoc.
Holmes.
Prentiss.

Posey.
Scott.
Sullivan.
Spencer.
Switzerland.
Vanderburg.
Warrick.
Washington.

Counties:
Metcalfe.
Monroe.
Muhlenberg.
Nelson.
Ohio.
Oldham.
Owen.
Russell.
Shelby.
Simpson.
Spencer.
Taylor.
Todd.
Trigg.
Trimble.
Union.
Warren.
Washington.
Wayne.
Webster.

Counties:
Quitman.
Sunflower.
Tallahatchie.
Tato.
Tippah.
Tishomingo.
Tunica.
Union.
Washington.
Webster.
Winston.
Yalobusha.

SEPTEMBER 1,1917.

MISSOURI (eastern part) (2,643,367). Counties: All except those included in District No. 10.
TENNESSEE (western part) (682,379). Counties:
Bcnton.
Carroll.
Chester.
Crockett.
Decatur.
Dyer.
Fayette.

Gibson.
Hardeman.
Hardin.
Hay wood.
Henderson.
Henry.
Lake.

Lauderdale.
McNairy.
Madison.
Obion.
Shelby.
Tipton.
Wcakley.

DISTRICT NO. 9—MINNEAPOLIS (5,164,426).
MICHIGAN (northern part) (372,533). Counties:
Alger.
Baraga.
Chippewa.
Delta.
Dickinson.

Gogebic.
Houghton.
Iron.
Keweenaw.
Luce.

Mackinac.
Marquette.
Menominee.
Ontonagon.
Schoolcraft.

MINNESOTA (2,312,445).
MONTANA (472,935).
NORTH DAKOTA (765.319).
SOUTH DAKOTA (716,972).
Florence.
Forest.
Iron.
La Crosse.
Lincoln.
Oneida.
Pepin.
Pierce.
Polk.

Price.
Rusk.
St. Croix.
Sawyer.
Taylor.
Trempcaleau
Vilas.
Washburn.

COLORADO (988,320).
KANSAS (1,851,870).

MISSOURI (western part) (786,228). Counties:
Clinton.
Dekalb.
Gentry.
Holt.
Jackson.
Jasper.

McDonald.
Newton.
Nodaway.
Flatto.
Vernon.
Worth.

NEW MEXICO (northern part) (196,440). Counties:
Sandoval.
San Juan.
San Miguel.
Santa Fe.

Taos.
Union.

OKLAHOMA (all except southeastern part) (2,112,489).
Counties:
Adair.
Alfalfa.
Beaver.
Blaine.
Beckham.
Caddo.

7830—17




Canadian.
Carter.
Comanche.
Cotton.
Custer.
Cherokee.

4

Payne.
Pottawatomie
Pittsburg.
Pontotoc.
Rogers.
Roger Mills.
Seminole.
Sequoyah.
Stephens.
Texas.
Tulsa.
Tillman.
Washita.
Wagoner.
Washington.
Woods.
Woodward.

WYOMING (184,970).

DISTRICT NO. 11—DALLAS (5,637,290).
Graham.
Santa Cruz.

Greenlee.

LOUISIANA (northern part) (596,464). Parishes:
Bienville.
Bossier.
Beauregard.
Caddo.
Caldwell.
Catahoula.
Claiborne.
Concordia.
De Sota.

East Carroll.
Franklin.
Grant.
Jackson.
La Salle.
Lincoln.
Madison.
Morehouse.
Natchitoches.

Ouachita.
Red River.
Richland.
Sabine.
Tensas.
Union.
Webster.
West Carroll.
Winn.

NEW MEXICO (southern part) (227,209). Counties:
Bernalillo.
Chaves.
Curry.
Dona Ana.
Eddy.
Grant.

Guadalupe.
Lincoln.
Luna.
Otero.
Quay.
Roosevelt.

Sierra.
Soeorro.
Torrance.
Valencia.

OKLAHOMA (southeastern part) (177,366). Counties:
Atotea.
Bryan.
Choctaw.

Coal.
Johnston.
McCurtain.

Marshall.
Pushmataha.

TEXAS (4,515,423).

NEBRASKA (1,284,126).
Colfax.
McKinley.
Mora.
Rio Arriba.

Lincoln.
Logan.
Love.
McClain.
Mclntosh.
Major.
Mayes.
Muskogee.
Murray.
Noble.
Nowata.
Okfuskee.
Oklahoma.
Okmulgee.
Osage.
Ottawa.
Pawnee.

ARIZONA (southeastern part) (120,828). Counties:

DISTRICT NO. 10—KANSAS CITY (7,404,443).

Andrew.
Atchison.
Barton.
Bates.
Buchanan.
Cass.
Clay.

Ellis.
Garfield.
Garvin.
Grant.
Grady.
Greer.
Harper.
Harmon.
Baskell.
Hughes.
Jackson.
Jefferson.
Kay.
Kingfisher.
Kiowa.
Latimer.
Le Flore.

Cochise.
Pima.

WISCONSIN (northern part) (524,222). Counties:
Ashland.
Barron.
Bayfield.
Buffalo.
Burnett.
Chippewa.
Douglas.
Dunn.
Eau Claire.

671

FEDEEAL EESERVE BULLETIN.

Cimarron.
Cleveland.
Craig.
Creek.
Delaware.
Dewey.

DISTRICT NO. 12—SAN FRANCISCO (6,631,164).
ARIZONA (northwestern part) (142,960). Counties:
Apache.
Coconino.
Gila.

Maricopa.
Mohave.
Navajo.

CALIFORNIA (3,029,032).
IDAHO (445,176).
NEVADA (110,738).
OREGON (861,992).
UTAH (443,866).
WASHINGTON (1,597,400).

Pinal.
Yavapai.
Yuma.

672

FEDERAL EESERVE BULLETIN.

SEPTEMBER 1,1917.

parture of such vessel from the port, and it shall thereupon
be unlawful for such vessel to depart. Whoever, in violaFurther revision of the export license list tion of any of the provisions of this section, shall take, or
and development of the forms used in con- attempt to take, or authorize the taking of any such vessel
nection with the granting of such licenses has out of port or from the jurisdiction of the United States
shall be fined not more than §10,000 or imprisoned for not
occurred during the past month. Because of more than two years, or both; and, in addition, such vessel,
its importance to bankers engaged in foreign her tackle, apparel, furniture, equipment, and her foroperations and desirous of ascertaining that bidden cargo shall be forfeited to the United States.
Now, therefore, I, Woodrow Wilson, President of the
each set of documents presented to them is
complete, details concerning the changes in United States of America, do hereby proclaim to all whom
concern that the public safety requires that, except
the license system during the month of August itat may
such time or times, and under such regulations and
are herewith presented.
orders, and subject to such limitations and exemptions
The President, on August 28, issued the as the President shall prescribe, until otherwise ordered
following proclamation, further explaining the by the President or by Congress, the following articles,
namely: All kinds of arms, guns, ammunition and exploconditions of the present export embargo:
sives, machines for their manufacture or repair, component
BY THE PRESIDENT OF THE UNITED STATES OF AMHRICA. parts thereof, materials or ingredients used in their manufacture, and all articles necessary or convenient for their
A PROCLAMATION.
use; all contrivances for or means of transportation in land
Whereas Congress has enacted and the President has, or in the water or air, machines used in their manufacture
on the 15th day of June, 1917, approved a law, which con- or repair, component parts thereof, materials or ingredients used in their manufacture, and all instruments,
tains the following provisions:
" Whenever during the present war the President shall articles and animals necessary or convenient for their
find that the public safety shall so require, and shall make use, all means of communication, tools, implements,
proclamation thereof, it shall be unlawful to export from instruments, equipment, maps, pictures, papers and other
or ship from or take out of the United States to any country articles, machines and documents necessary or convenient
named in such proclamation any article or articles men- for carrying on hostile operations, coin, bullion, currency,
tioned in such proclamation, except at such time or times, evidences of debt, and metal, materials, dies, plates,
and under such regulations and orders, and subject to such machinery and other articles necessary or convenient
limitations and exceptions as the President shall prescribe, for their manufacture; all kinds of fuel, food, foodstuffs,
until otherwise ordered by the President or by the Con- feed, forage and clothing, and all articles and materials
gress: Provided, however, That no preference shall be given used in their manufacture; all chemicals, drugs, dyestuffs,
and tanning materials, cotton, wool, silk, flax, hemp, jute,
to the ports of one State over those of another.
"Any person who shall export, ship, or take out, or sisal, and other fibers and manufactures thereof; all earths,
deliver or attempt to deliver for export, shipment, or taking clay, glass, sand and their products, hides, skins and
out, any article in violation of this title, or of any regula- manufactures thereof, nonedible animal and vegetable
tion or order made hereunder. shall be fined not more than products, machinery, tools and apparatus, medical,
$10,000, or, if a natural person, imprisoned for not more surgical, laboratory, and sanitary supplies and equipment;
than two years, or both; and any article so delivered or all metals, minerals, mineral oils, ores, and all derivatives
exported, shipped, or taken out, or so attempted to be de- and manufactures thereof: paper pulp, books, printed
livered or exported, shipped, or taken out, shall be seized matter, rubber, gums, rosins, tars and waxes, their prodand forfeited to the United States; and any officer, director, ucts, derivatives and substitutes, and all articles containor agent of a corporation who participates in any such viola- ing them; wood and wood manufactures; coffee, cocoa,
tion shall be liable to like fine or imprisonment, or both. tea, and spices; wines, spirits, mineral waters and bev"Whenever there is reasonable cause to believe that erages, shall not, on and after the 30th day of August,
any vessel, domestic or foreign, is about to carry out of in the year 1917, be exported from or shipped from or
the United States any article or articles in violation of the taken out of the United States or its territorial possessions
provisions of this title, the collector of customs for the to Albania, Austria-Hungary, that portion of Belgium occudistrict in which such vessel is located is hereby authorized pied by the military forces of Germany, Bulgaria, Denmark,
and empowered, subject to review by the Secretary of her colonies, possessions or protectorates; Germany, her
Commerce, to refuse clearance to any such vessel, domestic colonies, possessions, or protectorates: Greece, Leichtenor foreign, for which clearance is required by law, and by stein, Luxemburg, the kingdom of the Netherlands,
formal notice served upon the owners, master, or person or Norway, Spain, her colonies, possessions, or protectorates;
persons in command or charge of any domestic vessel for Sweden, Switzerland, or Turkey (excluding any portion
which clearance is not required by law, to forbid the de- of the foregoing occupied by the military forces of the




Export License System.

SEPTEMBER 1,1917.

United States or the nations associated with the United
States in the war), or any territory occupied by the military
forces of Germany or her allies; and
I do hereby further proclaim to all whom it may concern
that the public safety requires that, except at such time
or times, and under such regulations and orders, and
subject to such limitations and exceptions as the President shall prescribe, until otherwise ordered by the
President or by Congress, the following articles, namely,
coal, coke, fuel oils, lubricating oils, hand-lantern oil,
naphtha, benzine, red oil, kerosene, and gasoline, all
bunkers, food grains, flour and meal therefrom, corn
fiour, barley, rice flour, rice, oatmeal and rolled oats,
fodder and feeds, oil-cake, oil-meal cake, malt, and peanuts; all meats and fats, poultry, cottonseed oil, corn oil,
copra, desiccated cocoanuts, butter, fresh, dried, and
canned fish; edible or inedible grease of animal or vegetable origin; linseed oil, lard, tinned milk, peanut oil and
butter, grapeseed oil, tallow, tallow candles, and stearic
acid; sugar, glucose, sirup, and molasses; pig iron, ferrosilicon and spiegeleisen; steel ingots, billets, blooms, slabs,
and sheet bars; iron and steel plates, including ship, boiler,
tank, and all other iron and steel plates one-eighth of
an inch thick and heavier, and wider than 6 inches;
iron and steel structural shapes, including beams, channels, angles, tees, and zees of all sizes; fabricated structural iron and steel, including beams, channels, angles,
tees, zees, and plates, fabricated and shipped knocked
down; scrap iron and scrap steel, ferromanganese; tool
steel, high-speed steel and alloy steels and machine
tools; steel-hardening materials; fertilizers, including
cattle and sheep manure, nitrate of soda, poudrette,
potato manure, potassium salts, land plaster, potash,
cyanamide, phosphoric acid, phosphate rock, superphosphate, chlorate of potash, bone meal, bone flour,
ground bone, dried blood, ammonia and ammonia salts,
acid phosphates, guano, humus, hardwood ashes, soo-fe,
anhydrous ammonia; aeronautical machines and instruments, their parts and accessories thereof; arms and
ammunition, all explosives, nitrate of potash, rosin,
saltpeter, turpentine, ether, alcohol, sulphur, sulphuric
acid and its salts, acetone, nitric acid and its salts, benzol
and its derivatives, phenol ''carbolic acid" and its derivatives, toluol and its derivatives, mercury and its salts,
glycerin, potash and its salts, all cyanides and films;
carrier and other pigeons, antiaircraft instruments, apparatus, accessories, all radio and wireless apparatus and
its accessories, optical glass, optical instruments and
reflectors, cotton and cotton linters, wool, wool rags,
wool and khaki clippings, and wool products; flax, sisal,
jute, hemp, and all manufactures thereof; hides, skins,
leather, leather belting, sole and upper leather, leather
boots and shoes, harness and saddles and leather clothing;
soap and soap powders, all engines and motors operated
by steam, gas, and electricity, or other motive power,
and their accessories; metal and wood working machinery, oil-well casing, oil-well drilling implements and




673

FEDERAL RESERVE BULLETIN.

machinery and the accessories thereof; steam boilers,
turbines, condensers, pumps and accessories thereof; all
electrical equipment, crucibles, emery, emery wheels,
carborundum and all artificial abrasives, copper, including copper ingots, bars, rods, plates, sheets, tubes, wire
and scrap thereof; lead and white lead, tin, tin plate,
tin cans, and all articles containing tin, nickel, aluminum,
zinc, plumbago, and platinum; news paper, print paper,
wood pulp and cellulose; ash, spruce, walnut, mahogany,
oak, and birch woods, and industrial diamonds—shall not,
on and after the 30th day of August, in the year 1917,
be exported from, shipped from, or taken out of the
United States or its territorial possessions to Abyssinia,
Afghanistan, Argentina, that portion of Belgium not
occupied by the military forces of Germany or the colonies, possessions, or protectorates of Belgium, Bolivia,
Brazil, China, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Egypt, France, her colonies,
possessions, or protectorates; Guatemala, Haiti, Honduras, Italy, her colonies, possessions, or protectorates;
Great Britain, her colonies, possessions, or protectorates;
Japan, Liberia, Mexico, Monaco, Montenegro, Morocco,
Nepal, Nicaragua, the colonies, possessions, or protectorates of the Netherlands; Oman, Panama, Paraguay.
Persia, Peru, Portugal, her colonies, possessions, or protectorates; Roumania, Russia, Salvador, San Marino,
Serbia, Siam, Uruguay, Venezuela (excluding any portion of the foregoing occupied by the military forces of
Germany or her allies), or any territory occupied by the
military forces of the United States or by the natiens
associated with the United States in the war.
The regulations, orders, limitations, and exceptions
prescribed will be administered by and under the authority of the exports administrative board, from whom
licenses in conformity with said regulations, orders,
limitations, and exceptions will issue.
In witness whereof I have hereunto set my hand and
caused the seal of the United States of America to be
affixed.
Done at the city of Washington this 27th day of August,
in the year of our Lord 1917 and of the independence of
the United States of America the one hundred and fortysecond.
WOODROW WILSON.

By the President:
ROBERT LANSING, Secretary of State.

The following statement is reprinted from
| Commerce Reports for August 6:
I Export license is required at present for any article
| on the following list, which supersedes the list published
in Commerce Reports for July 23:
Coal.
! Coke.
Fuel oils, including lubricating oil; benzol; handlantern oil; toluol; naphtha; benzene; red oil.
Kerosene and gasoline, including bunkers.

674

FEDERAL RESERVE BULLETIN".

Food grains, flour and meal therefrom, including corn
flour, barley, rice flour, rice, oatmeal, and rolled oats.
Fodder and feeds, including oil cakes and oil-cake meal;
malt; peanuts.
Meats and fats, including poultry; cottonseed oil; corn
oil; copra; coconuts, desiccated; butter; fish, dried,
canned, or fresh; grease, inedible or edible, of animal
or vegetable origin; linseed oil; lard; meats, all varieties;
tinned milk; peanut oil and butter; rapeseed oil; tallow;
tallow candles; stearic acid.
Pig iron.
Steel billets, including steel sheet bars; steel blooms;
steel slabs.
Ship plates and structural shapes, including iron plates;
I beams; mild steel plates; rolled steel plates: steel
channels; steel angles; mild steel plates, ordinary tank
quality; steel beams; steel plates, one-eighth inch thick
or heavier; steel sheets, one-eighth inch thick or heavier,
are classified as steel plates; steel tees and zees; structural
steel shapes; boiler plates; tank plates; steel doors; steel
car frames; steel towers.
Scrap iron and scrap steel.
Ferromanganese.
Fertilizers, including cattle manure, shredded; nitrate
of soda; poudrette; potato manure; potassium salts; land
plaster; potash; cyanamide; phosphoric acid; phosphate
rock; superphosphate; chlorate potash; bone meal; bone
flour; ground bone; dried blood; ammonia and ammonia
salts; acid phosphates; guano; humus; hardwood ashes;
soot; sheep manure, pulverized; anhydrous ammonia.
Arms, ammunition, and explosives, including nitrate of
potash; rosin; saltpeter; turpentine; ether; alcohol;
sulphur; sulphuric acid and its salts; acetone; nitric
acid and its salts; derivatives of benzol; phenol (carbolic
acid) and its derivatives; derivatives of toluol; mercury
and its salts; ammonia and its salts; glycerine; potash
and its salts; all cyanides.

As already stated, changes in the license
forms have also occurred, the principal forms
now in use being the following:
APPLICATION FOR EXPORT LICENSE.
This form is to be used only for proposed shipments to countries associated with the United States in the war, or to the eolonies, possessions,
and protectorates of those countries, and only when such shipments
will not be licensed unless the goods are destined for war purposes or
will directly contribute thereto.
Application No
Disposition
Date
Drawn by
Checked by
,
License No
Expiration date
(Space above this line for official use only.)




SEPTEMBER 1,1917.

Instructions on page 4 should be carefully read before this application
is filled in. Answers must be written legibly, or typewritten, if possible.
Applicant's Reference No
Date
,191 .
DIVISION OF EXPORT LICENSES,

1435 KStreet NW., Washington, D. C.
hereby apply for license to export
(Quantity.)
of
(Goods.)
..Valued at 5.
(Consignee.)
Goods will be ready for shipment
(Signed)
By
Applicant's address

(Address.)
,191

License to be sent to.
Address
PLEASE EEAD CAREFULLY BEFORE FILLING IN APPLICATION. THIS WILL
AVOID DELAY.

(a) This form must be filled in in duplicate, and both copies signed by
the foreign purchaser or by his duly authorized representative in the
United States. Both copies must then be given to a representative of
the Government of destination who has been authorized to indorse
orTthis fourth page, applications for goods destined for war purposes
or directly contributing thereto. One copy bearing this indorsement
will be returned to the applicant or such representative as he may designate, and this copy must be filed immediately at Division of Export
Licenses, 1435 K Street NW., Washington, D. C.
(&) A separate application must be made for each country of destination.
(c) A separate application must be made for each class of goods and for
each consignment. If only a portion of the goods covered by a specific
license is exported, and the applicant desires to export the balance,
another application should be made on application Form D entitled
" Application for Supplementary Export License."
(d) The statement in regard to the quantity should be made in definite
units of net weight or measure, such as tons (of 2,240 pounds each),
pounds, bushels, gallons, etc., and not in such terms as boxes, cases,
sacks, etc.
(e) To avoid delays applicants are requested, in ease of further communication, to refer to their own reference number and date, as well as
to the reference number of the Division of Export Licenses if known,
and to refer to each application in a separate letter.
(f) If the space allowed on page 1 is not sufficient adequately to describe
the goods, a more complete description may be given in an accompanying letter. All documents which an applicant may wish to submit in
connection with the application must accompany the application in the
first instance.
AFFIDAVIT BY APPLICANT.

I hereby declare that I have been duly authorized to make this application in behalf of the foreign purchaser, and that I have full knowledge
that the statements made in this application are true and correct, and I
further declare materials, articles, or parts thereof mentioned herein
are destined for actual war purposes or will directly contribute thereto.
(Signed)
Address.
RECOMMENDATIONS OF REPRESENTATIVE OF THE GOVERNMENT OF DESTINATION.

(Signed)

SEPTEMBER 1,

Accompanying this form are the following
questions:

of

1. State name and address of person or firm by whom the material or
stores will be used, and whether engaged on Government work, and
if so, of what land and to what extent.
2. Is the material indispensable for efficient maintenance or repair
work?
3. State the nature and extent of the plant to be maintained, repaired,
or manufactured and the evidence of urgency.
4. State the specific purpose for which the material, etc., is required.
5. Why is it impossible to obtain the supply required, either in the
country of destination or elsewhere than the United States, or to substitute some other material for that now asked for?
6. How long will the supply now asked for last?
7. What is your normal consumption for the period mentioned in
your reply to No. 6?
8. What stocks, if any, do you now hold of the goods asked for? In
the case of machinery or plant what spares have you in hand at present?
Name all firms in the United States or elsewhere from whom you have
obtained the material, articles, or parts thereof in the past.
9. Have you any stores or material of the description referred to in
this application now under indent order or supply from the United
States, or elsewhere; if so, what is the quantity? When and with what
firm or firms was the order placed?
10. Give the name and address of United States manufacturer of the
goods referred to in this application.
NOTE.—Questions 1,3, 7, and 9 need not be answered if the buyer is a
foreign Government.

to

The following form is to be used for shipments to allied countries:
DEPARTMENT OF COMMERCE,
BUREAU or FOREIGN AND DOMESTIC COMMERCE,
DIVISION OF EXPORT LICENSES.

Application Form A-2,
This form to be used only for proposed shipments to countries associated
with the United States in the war, or to the colonies, possessions, or pro
tectoratcs of such countries.
App. No
Disposition
Date
Drawn by
Checked by
License No
Expiration date

*.

(Space above this line for official use only.)
Instructions on the back of this sheet should be carefully read before
this application is filled in. Answers must be written legibty, or type
written, if possible.
APPLICATION FOR ORDINARY EXPORT LICENSE.
Applicant's Reference No

Date

, 191

DIVISION OF EXPORT LICENSES,

1435 KStreet NW., Washington, D. C.
hereby apply for license to export




675

FEDERAL RESERVE BULLETIN".

1917.

(Quantity.)

(Goods.)
Valued at S....
(Consignee.)
(Address.)
Goods will be ready for shipment
,191
If the goods are to be re-exported by consignee, state to what country.
(Signed)
By
Applicant's address
License to be sent to
Address
PLEASE READ CAREFULLY BEFORE FILLING IN APPLICATION.
AVOID DELAY.

THIS WILL

(a) A separate application must be made for each country of destination.
(5) A separate application must be made for each class of goods and for
each consignment. If only a portion of the goods covered by a specific
license is exported and the applicant desires to export the balance,
another application should be made on application Form D, entitled
"Application for Supplementary Export License."
(c) To avoid delays, applicants are requested, in case of further communication, to refer to their own reference number and date as well as to
the Division of Export Licenses reference number, if known, and to refer
to each application in a separate letter.
(d) Responsibility of exporter.—YailwQ on the part of the applicant to
take reasonable precaution as to the distribution of goods; or the granting
of an export license based upon the statements contained in this application, will not relieve the consignor from any responsibility to which he
may be liable for affording aid and comfort to the enemy.
(e) Applicants are advised, if possible, to send in their applications at
least two weeks in advance of the proposed date of ocean shipment, or as
much earlier as possible. Export licenses, however, will not be issued
more than 60 days before the proposed date of ocean shipment. Ocean
bills of lading must bear date earlier than the expiration date shown on
the license. If a license expires before a shipment is made and a renewal
is desired, the original and duplicate copy of the original license must be
returned with an Application Form E, entitled "Application for Renewal of Export License." Original and/or renewal applications will
be considered in the order received.
(/) When filled in and signed send this application to the Bureau of
Foreign and Domestic Commerce, Division of Export Licenses, 1435 K
Street NW., Washington, I). C , or to any branch of that bureau.
(Q) Copies of ail application and instruction forms may be secured at
any of the following district offices of the Bureau of Foreign and Domestic
Commerce, Department of Commerce, or from the Division of Export
Licenses of that bureau, 1435 K Street NW., Washington, D. C:
New York, Bureau of Foreign and Domestic Commerce, 409 Customhouse.
Boston, Bureau of Foreign and Domestic Commerce, 1801 Customhouse.
Chicago, Bureau of Foreign and Domestic Commerce, 504 Federal
Building.
St. Louis, Bureau of Foreign and Domestic Commerce, 402 Third
National Bank Building.
New Orleans, Bureau of Foreign and Domestic Commerce, 1020 Hibernia Bank Building.
San Francisco, Bureau of Foreign and Domestic Commerce, 307 Customhouse.
Seattle, Bureau of Foreign and Domestic Commerce, 848 Henry
Building.

676

FEDERAL RESERVE BULLETIN".

In the case of shipments to other countries
the following form has been adopted:

Net.

Gross.

SEPTEMBER 1,1917.

Measure.

Full description
of goods.

Total approximate
value f. o. b. port
of shipment.

DEPARTMENT OF COMMERCE,
BUREAU OF FOREIGN AND DOMESTIC COMMERCE.

Application Form 9.
This form is to be used only for proposed shipments to countries not
associated with the United States in the war, or to the colonies, possessions, and protectorates of those countries.
This form is not to be used for applications to ship coal, fuel oil, or
bunkers.
Application No
Disposition
a

Date
Drawn by
Checked by
License No
Expiration date
(Space above this line for official use only.)
Instructions on page 4 should be carefully read before this application
is filled in. Answers must be written legibly or typewritten if possible.
APPLICATION FOR ORDINARY EXPORT LICENSE.
Covering

to
(Brief description of goods.)

Applicant's reference No

(Place and country of ultimate
destination.)
Date

DIVISION OF EXPORT LICENSES, BUREAU OF FOREIGN AND DOMESTIC
COMMERCE,

Washington, D. C.
hereby apply for a license to export the merchandise named
below to the consignee, purchaser, and country named below, in accordance with the provisions of Title VII of an act of Congress approved
June 15, 1917, entitled "An act to punish acts of interference with the
foreign relations," etc., having satisfied
that said
merchandise will not reach the enemy, directly or indirectly, and that
neither the consignee nor purchaser are dealing with, or engaged in
activities on behalf of, the enemy
desirous in
order to expedite an answer to this application that if necessary an
investigation be made by cable, the cost of which
prepared
to bear.
(Signed)
Address
By
Name
Address
Nationality
Year established..
Nature of business
Name
Address
2. Consignee.
Nationality
Year established.
Nature of business
Name
3. Purchaser abroad, Address
Year established.
if not consignee. Nationality
Nature of business.
4. Name and address to which t
license should be sent.
\
5. Name of line and/or/ vessel by which/
shipment will go forward.
I
6. Approximate date of intended ocean shipment
7. Port of intended shipment from this country
8. Prospective port of entry abroad
9. If goods are to be reexported, state to what country..
10. Quantity in tons:

1. Consignor.




(Totals.).. .
11. Purpose for which goods are to be used
12. Name of manufacturers of the goods
Point of origin
13. Ifshipped,dateofR. R.B/L
If arrived at seaboard, date of arrival
14. If not shipped from factory, are goods ready for shipment?
Or when will goods be ready?
15. Have you a firm order for the goods?
Date of order
16. Were you engaged in exporting goods of this kind to the proposed
country of destination previous to August, 1914?
17. State the period during which you have maintained regular business
relations with these purchasers
18. Is the present order from them a normal one as compared with their
orders previous to August, 1914?
19. If a guarantee has been issued in accordance with requirements
referred to in paragraph (c) of page 4, give name
,
address
, and reference
number of guarantor
20. What proofs have you that the goods are for consumption by neutrals or by allies of the United States?
hereby declare that to the best of
knowledge and
belief the foregoing particulars are correctly stated and
undertake that if this license is granted it shall be used solely for the export
of goods which are
own property, or the property of a person,
firm, or company for whom
act in this transaction as the sole
responsible representative.
(Signed)
.•
By
Status of signatory
PLEASE READ CAREFULLY BEFORE FILLING IN APPLICATION.
AVOID DELAY.

THIS WILL

(a) This form must be filled in by the individual, copartnership, or
corporation (herein called the applicant) making the sale to the foreign purchaser.
(6) The applicant must appear as the consignor on the ocean bill of
lading.
(c) When filling in applications for proposed shipments to certain
specified countries applicants must comply with the special instructions
relative to those countries which are given in the following forms
issued by the Division of Export Licenses of the Bureau of Foreign
and Domestic Commerce, and obtainable at the several places listed
under paragraph (o):
Sweden, "Instruction Form Al."
Norway, '• Instruction Form A2."
Denmark, "Instruction Form A3."
Holland, "Instruction Form A4. "
Switzerland, "Instruction Form A5."
Greece, " Instruction Form A6."
Salonika, "Instructioa Form A7."

(d) A separate application must be made for each country of destination.
(c) A separate application must be made for each class of goods and
for each consignment. If only a portion of the goods covered by a
specific license is exported, and the applicant desires to export the
balance, another application should be made on Application Form D,
entitled "Application for Supplementary Export License."
(/) To avoid delays, applicants are requested, in case of further communication, to refer to their own reference number and date as well
as to the Bureau of Foreign and Domestic Commerce reference number,
if known, and to refer to each application in a separate letter.
(g) All the essential information as to the goods, and the consignee
and purchaser to which the application relates, must be given on the
form itself, and not on an accompanying letter. Any special reasons in
support of an application other than those suggested in the form may be
given in a letter accompanying the form. All documents which an
applicant may wish to submit in connection with an application must
accompany the application in the first instance. The submitting of
such documents, however, does not in any way relieve the applicant of
his obligations as stated in the form.
(h) Application for license to ship coal and/or fuel oil, and bunkers,
must be made on Application Forms C and B, respectively.
(i) Complete description of goods, page 2:
1. Not more than one item should appear on each line.
2. Where number of items exceeds eight (8) or space provided is insufficient for adequate description of goods, a list of same may be attached
giving the particulars in exactly the same form as provided in the application blank.
3. Net and gross weights must be given in tons of 2,240 pounds or
fractions thereof. Measurement must be in tons of 40 cubic feet or fractions thereof. Measurement need not be given in the case of goods which
arc, by custom, shipped on a weight basis. If unable, on account of
the nature of the commodity to express quantity in tons, give quantity
in customary units. Description of goods must include number of packages and contents of each. Values must be in dollars.
4. In the case of compound articles the exact composition and proportion of the components must be stated. For example, under question
10 might be written (quantity in tons):

Net.

Gross.

Meas.

10

11

8.5

10

11

8.5

Total approxvalue
Full description of goods. imate
f. o. b. port
of dispatch.
80 boxes white metal
containing 61 per cent
copper, 20 per cent
nickel, 19 per cent zinc.
Total

$15,000
15,000

The above information will be held as confidential.
(j) Responsibility of exporter.—Failure to take reasonable precautions
as to the distribution of goods and the granting of an export license
based upon the statements contained in this application will not relieve
the consignor from any responsibility to which he may be liable for
affording aid or comfort to the enemy.
(fc) Applications must be signed by the individual applicant, or in
case of a copartnership, by a member thereof, or in case of a corporation
by an officer who is authorized to sign on behalf of the corporation.
(J) When filled in and signed, send this application to the Bureau of
Foreign and Domestic Commerce, Division of Export Licenses, 1435 K
Street NW., Washington, D. C, or to any branch of that bureau.
(w) Applicants are advised, if possible, to send in their applications
at least two weeks in advance of the proposed date of ocean shipment,
or as much earlier as possible. Export licenses, however, will not be
issued more than 60 days before the proposed date of ocean shipment.
Ocean bills of lading must bear date earlier than the expiration date
shown on the license. If a license expires before a shipment is made
and a renewal is desired, the original and duplicate copy of the original
license must be returned with an Application Form E, entitled "Application for Renewal of Export License." Original and/or renewal applications will be considered in the order received.
(«) Appeals from the decisions in regard to applications will not be
considered unless some new facts or considerations are adduced.




677

FEDEKAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

(o) Copies of all application and instruction forms may be secured at
any of the following district or cooperative o-fices of the Bureau of Foreign
and Domestic Commerce, Department of Commerce, or from the Division of Export Licenses of that bureau in Washington, D. C:
Now York, Bureau of Foreign and Domestic Commerce. 409 Customhouse.
Boston, Bureau of Foreign and Domestic Commerce, 1801 Customhouse.
Chicago, Bureau of Foreign and Domestic Commerce, 504 Federal
Building.
St. Louis, Bureau of Foreign and Domestic Commerce, 402 Third
National Bank Building.
New Orleans, Bureau of Foreign and Domestic Commerce, 1020 Hibernia Bank Building.
San Francisco, Bureau of Foreign and Domestic Commerce, 307 Customhouse.
Seattle, Bureau of Foreign and Domestic Commerce, 848 Henry
Building.

Commercial Failures Reported.

Notwithstanding the uncertainties arising
from war conditions and the slowing down of
business in some directions, the country's commercial mortality discloses continued reduction in comparison writh recent years, 777 commercial failures being reported to R. G. Dun &
Co. for three weeks of August, against 901 in
the same period of 1916. The statement for
July—the latest month for which complete
figures are available—show^s 1,137 defaults for
§17,240,424, as compared with 1,207 for
$11,647,499 in July last year, the increase in
amount being due to several insolvencies of
unusual size. Numerically, decreases appear
in 8 of the 12 Federal Reserve districts, namely,
the first, fourth, sixth, seventh, eighth, ninth,
tenth, and twelfth, the sixth district making the
best exhibit, with a falling off of over 30 per
cent. On the other hand, the liabilities were
larger than in July, 1916, in the second, third,
sixth, seventh, eighth, tenth, and twelfth districts, and notably so in the latter instance.
Failures during July.
Number
Districts.

First
Second....
Third
Fourth...
Fifth
Sixth
Seventh...
Eighth....
Ninth
Tenth
Eleventh.
Twelfth...
Total

1917

Liabilities.

1916

108
224
54
95
71
83
154
67
29
50
61
141

128
208
47
113
56
123
176
70
30
59
50
147

1,137
1,137

1 207

1917

1916

§1,061,620 SI 309,433
3,752,280
2 617,469
658,693
441,739
1,255,521 1 318,999
542,271
595,200
1,602,345 1 246,565
2,878,775
1 479,201
475,182
454,750
165,877
477,600
509,239
339,136
292,589
463,508
4,046,032
903,900
17,240,424

647,499

678

FEDERAL RESERVE BULLETIN.

Fiduciary Powers.
The applications of the following banks for
permission to act under section Ilk of the
Federal Reserve Act have been approved since
the issue of the August Bulletin:
DISTRICT NO. 1.

Trustee, executor, administrator, and registrar of stock
and bonds:
Manufacturers National Bank, Lynn, Mass.
Trustee, executor, and administrator:
Edgartown National Bank, Edgartown, Mass.
DISTRICT No. 3.

Trustee, executor, administrator, and registrar of stocks
and bonds:
Myerstown National Bank, Myerstown, Pa.
DISTRICT No.

4.

Trustee:
German National Bank of Allegheny, Pittsburgh, Pa.
Registrar of stocks and bonds:
First National Bank, Canton, Ohio.
DISTRICT No.

7.

Trustee, executor, administrator, and registrar of stocks
and bonds:
Capital National Bank, Lansing, Mich.
Trustee, executor, and administrator:
Farmers & Merchants National Bank, Benton Harbor,
Mich.

SEPTEMBER 1,1917.

national banks during the period from July
28, 1917, to August 24, 1917, inclusive:
Banks.

New charters issued to
With capital of
Increase of capital approved for
With new capital of

19
$930,000
10
2,625,000

Aggregate number of new charters and
banks increasing capital
29
With aggregate of new capital authorized
3,555,000
Number of banks liquidating (other than
those consolidating with other national
banks)
1
Capital of same banks
Number of banks reducing capital
0
Reduction of capital
Total number of banks going into liquidation or reducing capital (other than those
consolidating with other national banks).. 1
Aggregate capital reduction

100,000
0

100,000

The foregoing statement shows the aggregate of
increased capital for the period of the banks
embraced in statement was
3,555,000
Against this there was a reduction of capital
owing to liquidations (other than for consolidation with other national banks) and
reductions of capital of
100,000
Net increase

3,455,000

DISTRICT NO. 10.

Trustee, executor, administrator, and registrar of stocks
and bonds:
First National Bank, Buffalo, Wyo.
Trustee, executor, and administrator:
First National Bank, Luray, Kans.
DISTRICT NO. 11.

Trustee, executor, administrator, and registrar of stocks
and bonds:
Tenison National Bank, Dallas, Texas.

New National Bank Charters.
The Comptroller of the Currency reports the
following increases and reductions in the number of national banks and the capital of




GOLD SETTLEMENT FUND.
Since the publication of the statement in the
August Bulletin showing the clearings and
transfers of the Federal Reserve Banks through
the gold settlement fund, the aggregate balances in the fund of both the banks and agents
have increased $11,895,100, as compared with
a total increase since the beginning of the present calendar year of $318,774,350. The heavy
transfers shown for the week ending August 2
are due to the concentration of Government
funds in the New York bank, mainly for the

SEPTEMBER 1,

679

FEDERAL RESERVE BULLETIN.

1917.

of clearings and transfers, Federal Reserve Banks,
purpose of making advances to the representa- Amount from
July 20 to Aug. 23, 1917, inclusive.
tives of the allied Governments.
[000 omitted.]
Withdrawals of funds from New York correspondents by banks in the interior, in order
Total
Balances
Transfersclearings.
adjusted.
to make payment on August 9 to their respective Federal Reserve Banks on account Settlement of—
July 26,1917
§667,661
852,176
$55,000
of subscriptions to the $300,000,000 issue of
Aug. 2,1917
545,256
52,454
144,000
Aug. 9,1917
428,681
87,566
21,500
United States certificates of indebtedness, is
Aug. 16, 1917
501,123
48,051
39,500
Aug. 23,1917
453,484
31,6S1
23,900
partly responsible for the large debit balance of
Total... .
2,596,205
271,928
283,900
$87,566,000 shown for the New York bank in Previously
reported for 1917
10,007,413
860,587
995,044.5
the settlement of August 9.
Total
since
Jan.
1,1917...
12,603,618
1,132,515
1,278,944.5
transfers Jan. 1,1917, to
BelowT are given figures showing changes in Total
date
1,278,944.5
for 1916, including transthe fund from July 20 to August 23, 1917, in- Total
fers
5,633,966
for 1915, including transclusive. Changes in the ownership of gold in Total
fers
1,052,649
the fund amounted to only 1.76 per cent of the Total clearings and transfers
May 20,1915, to Aug. 23,1917. 20,569,177.5
obligations settled.
Changes in ownership of gold.
|000 omitted.]
Total to July 19,1917.

Federal Reserve Bank of—
Decrease.

Boston..
New Y o r k . . . .
Philadelphia...
Cleveland
Richmond
Atlanta..
Chicago..
St. Louis.
Minneapolis...
Kansas City...
Dallas...
San Francisco.

8493,938

493,938

Total.
id
2 TO

Increase.

§46,993
83,211
80,688
18,108
23,326
53,290
12,218
14,000
48,143.5
30,821.5
83,099
493,938

From July 19 to Aug. 23,1917, inclusive, i
Balance to
credit July
19,1917,
plus net
deposits of
gold since
that date.

Balance,
Aug. 23,
1917.

821,165
$17,553
80,540
117,840
34,483
26,867
54,140.6
54,346.6
24,151.1
31,163.1
5,955
3,523
74,324
47,(566
25,214
25,678
12,597
7 871
36,382.65 38,259.65
12,732
7.135
17,469
2li251
399,153.35

399,153.35

Decrease.

Total changes
from May 20,1915,
to Aug. 23,1917.a

Increase.

Decrease.

§37,300

$456,638

§3,612
7,616
2,432
26,658

206
7,012
464

4,726
"1,*877

"o,"597"
50,641

50,641

456,038

Increase.

$43,381
75,595
80,874
25,180
20,894
26,632
12,682
9,274
50,020.5
25,224.5
86,881
456,638.0

£es in ownership of gold during period July 19 to August 23, 1917, equal 1.76 per cent of obligations settled,
changes in ownership of gold since May 20,1915, equal 2.22 per cent of obligations settled.

Gold-settlement fund—Summary of transactions from July 20 to Aug. 23, 1917, inclusive.
[000 omitted.J
Balance
last
Federal reserve bank

of—

statement,

Gold.

July 19,
1917.
Boston....
New York
Philadelphia

fH'ina
l}<?,790
15,972

St. Louis
10,260
19,859

Dallas
San Francisco
Total

7830—17




;396,469.25 !

5

Transfers.

Weekly settlements from July 20 to Aug. 23,
1917.

f"—
Withdrawn.

Deposited.

$10,000
§38,000 2,750
2,250 20,761
10,450 6,982
9,000 8,052.1
2,460 1,725
16,520 24,758
1,820 1,450
2,000 5,350
3,274
3,358
110
2,500
85,886

88,570.1

Debit.

Credit.

Net
debits.

$36, 000
32, 900 :: §245,500 $193,100
43 000
4,751
55, 5 0 0 '••
:
'30, 000
18,000
22,772
1,900 !
6,063
12,855
49,500 ;
12,539
5,000
2,
500
5,253
15,
139
3,719
8,
12,
10,737
13,000
283,900

'283,900

2 7.1,9

Total
debits.
8194,806
936,195
278,639
190,695 I
125,838
59,184
361,360
158,752
48,254
93,949
42,109
106,424
2,596,205

Total
credits.
8227,194
760,895
314,023
246,401
144,850
54,852
384,202
154,216
45,028
110,826
44,512
109,206
2,596,205

Net

832,388
17,800
40,135
55,706
41,784
1,731
35,697
8,003
2,027
17,016
6,122
13,519

Aug. 23,
1917,
balance
in fund
after
close of
business.
$17,553
117,840
26,867
54,346.6
31,163.1
3,523
25,678
7,871
38,259.65
7,135
21,251

271,928 1399,153.35

680

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917,

Federal Reserve Agents' Fund—Summary of transactions from July 20 to Aug. 23, 1917.
[000 omitted.]
!

Balance
last state- Gold
ment,
withFederal Reserve Agent at— Julv
19, drawn.
1917.
Boston
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis

$2,000 !
26,940 i
20,000 !
7,000
13,580
56,210
10,840

Gold
deposited.

§1,361
500
1,000
672
700

SI,000
2,460
11,520
1,620

Balance !
Aug. 23,; Federal Reserve Agent at—
1917.
j

$2,000
25,579 ;
20,000 !
7,500 |

Minneapolis
Kansas City....
Dallas
San Francisco..
Total

Balance
last state- Gold
ment,
withJuly 19, drawn.
1917.

Gold
Balance
depos- Aug. 23,
ited. j 1917.

S6,250
11,060
3,060
25.160

$2,000

| 182,730

10,389

3,456
700

S500 i
2,500 |

S4,250
11,060
704
26,990

19,600 ! 191,941

ll',760 |
I

Operations of the Federal Reserve Clearing System, July 16 to Aug. 15, 1917.
Items drawn on banks Items drawn on banks
drawn on banks
in Federal Reserve
in district outside Items
in other districts
city (daily averFederal
Reserve
(daily
average).
city (daily average).
Number. | Amount.
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Totals:
July 16 to Aug. 15,1917
June 16 to July 15,1917
May 16 to June 15,1917
Apr. 16 to May 15,1917
Mar. 16 to Apr. 15,1917
Feb. 16 to Mar. 15,1917
Jan. 16 to Feb. 15,1937
Dec. 16,1916, to Jan. 15, 1917.
Nov. 16 to Dec. 15, 1916
Oct. 16 to Nov. 15,' 1916
Sept. 16 to Oct. 15,1916..
Aug. 16 to Sept. 15, 1916.
July 15 to Aug. 15,1916..

Boston
'.
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Totals:
July 16 to Aug. 15,1917
June 16 to July 15,1917
May 16 to June 15,1917
Apr. 16 to May 15,1917
Mar. 16 to Apr. 15,1917
Feb. 16 to Mar. 15,1917
Jan. 16 to Feb. 15,1917
Dec. 16,1916, to Jan. 15,1917.
Nov. 16 te Dec. 15t 1916
Oct. 16 to Nov. 15,1916
Sept. 16 to Oct. 15,1916
Aug. 16 to Sept. 15,1916
July 15 to Aug. 15,1916




2,228
4,646
12,629
1,165
1,031
1,094
6,580
1,636
2,073
1,836
883

Number.

Amount.

Number.

Amount.

9,639
8,950
8,896
5,465

§4,056,756
7,290,652
2,527,832
8,745,096
4,407,479
1,577,915
2,997,940
1,641,198
846,403
1,937,383
2,889,799
1,434,825

2,787
13,703
7,839
883
1,552
1,290
1,287
220
641
570
322
179

65,383,530
9,381,085
8,348,116
2,430,252
3,232,975
1,333,887
712,999
2,314,050
645,467
3,274,671
600,442
323,548

175,625
182,622
179,193
171,093
168,607

40,353,278
41,004,720
38,599,461
36,473,163
32,666,959

31,273
33,941
33,150
33,428
32,008

37,981,022
46,762,698
38.314,393
36,836,934
34,693,542

39,926,486
38,452,543
12,202,102
3,448,020
2,530,303
956,009
14,709,032
4,820,182
3,923,480
3,839,332
1,106,769
2,161,661

34,107
32,199
19,081
15,155
12,833
8,460
12,771

36,727 98,075,919
38,476 109,722,256
37,898 97,322,883
33,767 87,370,859
31,162 60,288,002

Total (exclusive of
items drawn on
Treasurer of United
States) (daily average).

Items drawn on
T r e a s u r e r of Number Number
U n i t e d States of mem- of nonmember
ber
(daily average).

Number.

Number. Amount.

Amount.

banks in banks on
district. par list.

39,122
50,548
39,549
17,203
15,416
10,844
20,638
9,925
12,353
11,356
10,101

6,570

§19,366,772
55,124,280
23,078,050
14,623,368
10,170,757
3,867,811
18,419,971
8,775,430
5,415,350
9,051,386
4,597,010
3,920,034

1,438
9,697
1,359
220
230
521
2,454
2,218
158
985
17
236

243,625
255,039
250,241
238,288
231,777
234,475
220,421
241,933
236,038
227,489
204,891
177,397
133,113

176,410,219
197,489,674
174,236,737
160,680,956
127,648,503
116,404,430
110,188,028
121,814,589
125,603,732
115,061,224
97,666,107
78,559,704
59,301,696

19,533
19,100
16,344
15,925
12,582

§928,801
2,950,631
1,589,792
61,384
60,071
223,446
590,039 ]
422,022 !|
47,089
601,000 i
4,297
2,222,997
9,701,569
11,637,899
4,414,508
3,597,865
2,643,408

394
629
632
753
519
380
1,051
471
742
948
630
534

248
342
251
542
269
352
1,943
968
1,012
1,518
217
1,175

7,683
7,666
7,651
7,634
7,625
7,630
7,630
7,622
7,627
7,623
7,618
7,618
7,624

8,837
8,805
8,789
8,926
8,607
8,007
8,086
8,130
8,065
8,059
7,459
7,449
7,032

681

FEDERAL RESERVE BULLETIN.

SEPTBMBEK 1, 1917.

COMPARATIVE STATEMENT OF LEADING chiefly those immediately preceding the outBANKS OF ISSUE, 1914 AND 1917.
break of the war, while for 1917 the dates of

In continuation of similar figures printed on
page 658 of the November, 1916, Bulletin there
are presented below comparative statements
showing the condition of the Federal Reserve
Banks treated as a whole, and of the leading
central banks of issue in 1914 and 1917. For
the earlier year the report dates chosen are

the latest reports on hand were taken.
No changes were made in the methods of presentation. It is thus possible to make fair comparisons between the 1914, 1916, and 1917 figures and to trace the effect of the war on the
condition of the central banks in both the
belligerent and neutral countries.

Comparative statement shovjing principal assets and liabilities of the leading central banks of issue, at dates specified.
[In thousands of dollars; i. e., 000 omitted.]
Federal Reserve Banks.
Dec. 31,
1914.

July 27,
1917.

Bank of England.
July 29,
1914.

Russian State Bank.

B a n k of France.

Julv 25,
1917.

J u l y 30,
1914.

July 16/29, June 16/29,
1917.
1914.

J u l y 12,
1917.

ASSETS.

Gold eoin and bullion
Silver and other metallic reserve
Total metallic vault reserve
Gold held abroad
Foreign credits...
Government securities:
Bonds, consols, e t c . . . . .
Short-term securities
Other Government securities

241,321
17,823

1,309,763 }
14,397

185,567

258,550 /\

799,279
120,689

259,144

1,324,160

185,567

258,550

919,968

52,500
205
8,755

Total
Notes of other banks of issue
Loans and discounts
Advances on bullion and specie, securities,
Securities
Sundry assets
Total

41,135
35,818 1
37,392

8,960

114,345

4,624
9,909

13,403
305,131

734
9,237

1,469
210,229

292,608

2,021,237

628,916
50,616

825,884
37,487

762,676
66,453

679,532

863,371

829,129

72,471

1,091,601

392,712
142,938

|

41,019
963
38,600

40,944
515,311
2,103,700

83,860
5,249,565

80,582

2,659,955

5,333,426

471,746

331,220

220,932

256,525

146,443

223,602

77,173

169,246

179,273
53,075
109,931

691,393
133,334
292,810

1,124,510

1,695,912

4,539,205

1,499,053

8,628,217

70,822

35,222

35,222
q 909

143,343

324,000

143,343

324,000

f
\
1

!
23*6,222

559,132

541,960

LIABILITIES.

Capital paid in
Government deposits.
Other deposits..
Bank notes in circulation
Sundry liabilities

. . ...

Total

18,051

57,825

70,822

28,325

28,325

Ifl QQ9

1(3 1 If"

263,948
10,000

H3,032
1,281,818
536,474
2,088

61,869
264,830
184,566
53

226,850
617,267
193,377

78

73*, 834
182,881
1,289,885
105,914

13,518
477,954
3,896,923
107,296

264,937
327,585
841,174
37,032

114,825
1,445,527
6,484,876
554,664

292,608

2,021,237

559,132

1,124,510

1,695,912

4,539,205

1,499,053

8,628,217

Bank of Italy.
Dec. 31,
1914.

June 20,
191.7.

German Reichsbank.
July 31,
1914.

J u n e 15,
1917.

B a n k of Netherlands.
J u l y 25,
1914.

July 21,
1917.

Riksbank , Sweden.
July 31,
1914.

June 30,
1917.

ASSETS.

Gold coin and bullion . . . .
Silver and other metallic reserve
Total metallic vault reserve
Gold held abroad
Foreign credits
Government securities:
Bonds, consols, etc
Short-term securities
Other Government securities
Total




}

236,633 /\

161,059
12,752

298,261
65,409

602,938
11,859

65,140
3,307

249,726
2,943

24,746
1,408

54,324
908

236,633

173,811

363,670

614,797

68,477

252,669

26,154

55,232

8,195

89,766

13,564

5,879

105,865 1

464,926

7,960

125,533

5,003

3,674

o7,332

24,429

6 464,926

7,960

125,533

5,003

3,674

a 7,332

24,429

105,865

a Includes both Government and corporate securities.

& Including S4,003,000 of foreign treasury bills.

682

SEPTEMBEK 1,1917.

FEDERAL RESERVE BULLETIN.

Comparative statement showing principal assets and liabilities of the leading central banks of issue, at dates specified—Con.
[In thousands of dollars; i. e., 000 omitted.]
German Reichsbank.

Bank of Italy.
Dec. 31,
1914.

June 20,
1917.

July 31,
1914.

June 15,
1917.

Bank of Netherlands.

Riksbank, Sweden.

July 25,
1914.

July 31,
1914.

July 21,
1917.

July 30,
1917.

ASSETS—continued.

Notes of other banks of issue
Loans and discounts
Advances on bullion and specie, securities,
merchandise, etc
Securities
Sundry assets
Total

:

a 5,416 j
180,297 j
29,180
39,486
28,618 i

6 10,658
693,803
72,044
42,504
42,393

2,740
495,296

1,229
2,254,860

48,121
94,392
51,901

2,427
23,783
256,599

633,690 j 1,589,905

1,064,081

LIABILITIES.

Capital paid in
Surplus
Government deposits
Other deposits
Bank notes in circulation
Sundry liabilities
Total

34,740
13,515
40,320
118,035
417,352
9,728

I

Gold held abroad
Foreign credits
Government securities:
Bonds, consols, etc
Short-term securities
Other Government securities.
Total.

c 1,893
42,303

56,141

24,798

3,612
928

30,978
3,664
24,974

813

11*027
1,525
25,080

138,248

339,140

92,059

179,313

8,040
2,011

8,040
2,104

13,400
4,539
31,111
124,894
5,369
179,313

42,840
17,726
299,515
692,442
11,558

42,840
21,453
1,146,278
1,957,318
111,339

1,904
124,796
1,497 |

21,186
305,531
2,279

11,900
2,975
18,440
54,367
4,377

633,690 ! 1,589,905

1,064,081

3,279,228

138,248 i

339,140

92,059

Bank of Spain.

Swiss National
Bank.

Bank of Japan.

July 31,
1914.

July 23,
1917.

July 31,
1914.

June 30,
1917.

July 24,
1914.

June 23,
1917.

July 23,
1914.

14,405

34,815

24,410

53,356

105,798
143,063

297,644
146,101

34,753
3,656

65,712
10,053

110,189

258,757

24,410

53,356

248,861

443,745

38,409

75,765

110,521

258,757

67,047

66,476

29,199

*48,"250'

1,120

"i6*956"

96,246

114,726

1,120

36,120

28,515

152,579

80,033

18,099

38,811

39,242

76,061

69,120
2,249
9,365

2,699
2,446
5,594

3,032
1,490
11,530

16,647
26,664

J 736,752

67,247

131,748

299,052

9,775
204,488
577,596

28,950
5,018
153', 432
474,304
31,145

4,825
471
28,819
83,176
2,606

4,825
568
19,854
104,250
2,246

18,675
14,290
69,230
5,714
180,411
10,732

18,675
18,551
254,585
10,913
274,854
18

736,752

67,247

131,748

299,052

577,596

14,405
8,166
2,399

d22,994

11,996

c3,431

2,399

Notes of other banks of issue
Loans and discounts
Advances on bullion and specie, securities, merchandise, etc
Securities
Sundry assets

23,181

46,320
14,752
43,238
558,902
816,096
110,597

Bank, CoNorges Bank, Nor- National
penhagen, Denway.
mark.

Gold coin and bullion
Silver and other metallic reserve..
Total metallic vault reserve

35,430

23,690

73,917

2,307
27,098
3,106
9,627

Total

41,278

June 30, June 30,
1914.
1917.

17,513

11,456

66,548

July 7,
19l7.

69,858
25,164

17,339

LIABILITIES.

Capital paid in
Surplus
Government deposits
Other deposits
Bank notes in circulation.
Sundry liabilities
Total.

3,859
32,859

38,548
78,594

199
5,496
39,525
12,092

19,442
82,239

66,548

a Includes $1,737,000 of foreign bank notes.
h Including 81,130,000 of foreign bank notes,
c Included foreign bank notes, also drafts and bills payable at sight.




373,557

d Including foreign bills.
e Including foreign government securities.

SEPTEMBER 1, 1917.

683

FEDERAL RESERVE BULLETIN.

COURSE OF DOLLAR AND STERLING EXCHANGE SINCE 1914.
As pointed out on page 582 of the August
Federal Reserve Bulletin, the American dollar,
as well as the pound sterling, is at a discount in
all neutral European countries. This condition is not, however, of recent origin. As may
be seen from subjoined tables and attached
diagrams, the downward course of dollar and
sterling exchange began not long after the outbreak of the war, though owing to the closing
of the London and New York Stock Exchanges
quotations of exchange during the first year of
the war were irregular at best, and in some
cases entirely lacking. This is true of New
York exchange on the Scandinavian, Swiss, and
Spanish markets.
In order to eliminate the differences in distance and time required for remittance, the

rates chosen were those for cable transfers.
Index numbers with mint or par rates as their
bases were figured and plotted so as to present
the movement of rates along uniform and comparable lines. The percentages above and below 100 measure the degree of appreciation or
depreciation of the dollar or pound sterling
in terms of the respective foreign currencies.
A comparison of dollar and sterling rates
brings out the fact mentioned in the earlier
Bulletin, that, particularly since measures
have been taken to stabilize sterling exchange
on New York at about the present rates, New
York and London rates of exchange on neutral
places practically run a parallel course, dollar
exchange rates in nearly all cases showing less
depreciation than the corresponding London
rates.

Comparative rates for cable transfers to principal neutral places in Europe based upon quotations in New York and London
since July, 1914, as reported by the National City Bank of New York City and the London Economist.
Christiania.

Amsterdam.
New York, par
2.488.

Rate.

Per
cent.

2.410
2.454
2.439
2.447
2.454
2.454
2.454
2.454
2.462
2.462

96.87
98.63
98.03
98.35
98.63
98.63
98.63
98.63
98.95
98.95

1914.
Oct 20 Oct. 27
Nov. 10
Nov. 17
Nov 24
Dec. 1
Dec 8
Doc. 15
Dec 22 .
Dec. 29

..
1915.

Jan 12
Jan. 19
Jan. 26
Feb 2
Feb. 9
Feb. 16
Feb. 23
Mar. 2 . .
Mar. 9
Mar. 16
Mar. 23.
Mar. 30
Apr. 6
Apr. 13
Apr. 20
Apr. 27
May 4
May 11
May 18
Mav25
Jure 1
June 8

.

.
. .




.

2.469
2.484
2.488
2.481
2.481
2.477
2.500
2.496
2.500
2.500
2.508
2.524 •
2.520
2.528
2.528
2.508
2.535
2.528
2.531
2.528
2.528
2.528
2.500

London, par
12.107.
Rate.

Per
cent.

12.04
11.99
12.01
12.00
12.02

99.45
99.00
99.20
99.12
99.28

99.24 12.005
99.84 12.045
100.00 12.06
99.72 12.057
99.72 12.05
99.56 11.99
100. 48 12.03
100.32 12.015
100.48 12.055
100.48 12.07
100.80 12.095
101.45 12.14
101.29 12.15
101.61 i
101.61 12-21
100. 80 12.18
101.89 12.175
101.61 12.14
101.73 !i 12.14
101.61 12.115
101.61 12.12
101.61 12.02
100.48 12.00

London, par
18.159.

New York, par
3.731.

Rate.

Stockholm.

Per
cent.

Rate.

Per
cent.

! 19.30
19.37
I 19.37
19.4.0
19.35

iO6.28
106.67
108.67
106.83
106.56

1

99.16
99.49
99.62
99.59
99.53
99.00
99.37
99.24
99.57
99.70
99.90
100.28
100.36

19.38
106.72
106.67
19.37
19.45
107.11
i 19.45 107.11
• 19.47 107.22
19.fiO
107.93
19.65
108. 21
19.68 1 108.38
19.75
10S.7fi
19.80
109.04
107.93
19.60
19.48
107.27
104.H3
19.00

100.85
100.61
100.56
100.28
100.28
100.07
100.11
99.28
99.12

18.70
19.00
'; IS. 70
18.60
18.55
18.525
18.45
18.30
18.20

102.98
104.63
102.98
102.43
102.15
102.02
101.60
100.78
100. 23

New York, par
3.731.
Per
cent.

Rate.

. ..

..

London, par
18.159.
Rate.

Per
cent.

19.30
19.37
19.37
19.40
19.35

106.28
106 67
106.67
106.83
106.56

19.38
106.72
19.37
106.67
19.45
107.11
19.45
107.11
1fi7 9.9,
19.47
19.60 ' 107.93
19.65 i 108.21
108.38
19.68
19.75
108.76
109.04
.19.80
19.60
107.93
19.48
107.27
19.00
104.63
18.70 !
19.00
18.70 i
. : 18.60 1
: 18.55 i
18.525 i
. i 18.45
! is. ?,n
18.20

102.08
104.63
102.08
102.43
102.15
102.02
101.60
inn.78
100.23

684

FEDERAL RESERVE BULLETIN".

SEPTEMBER 1,1917.

Comparative rates for cable transfers to principal neutral places in Europe based upon quotations in New York and London
since July, 1914, as reported by the National City Bank of New York City and the London Economist—Continued.
Christiania.

Amsterdam.
New York, par
2.488.
Rate.

Juno 15..
June 22..
June 29..
July 6 . . .
July 13..
July 20..
July 27..
Aug. 3 . . .
Aug. 10..
Aug. 17..
Aug. 24..
Aug. 31..
Sept. 7...
Sept. 14..
Sept. 21..
Sept. 28..
Oct. 5 . . .
Oct. 12..
Oct. 19..
Oct. 26..
Nov. 2...
Nov. 9...
Nov. 16..
Nov. 23..
Nov. 30..
Dec. 7 . . .
Dec. 14..
Dec. 2 1 . .
Dec.28..
Jan. 4 . . .
Jan. 1 1 . .
Jan.18..
Jan.25..
Feb. 1 . . .
Feb. 8 . . .
Feb. 15..
Feb. 22..
Feb. 29..
Mar. 7 . . .
Mar. 14..
Mar. 2 1 . .
Mar. 28..
Apr. 4 . . .
Apr. 11..
Apr. 18..
Apr. 25..
May2...
May 9 . . .
May 16..
May 2 3 . .
May 30..
June 6...
June 13..
June 29..
June 27..
July4...
July 1 1 . .
July 18..
July 2 5 . .
Aug. 1...
Aug. 8...
Aug. 15..
Aug. 22..
Aug. 29..
Sept. 5 . .
Sept. 12.
Sept. 26.
Oct. 3 . . .
Oct. 10..
Oct. 1 7 . .
Oct. 2 4 . .
Oct. 3 1 . .




1915.

2.504
2.500
2.500
2.500
2.492
2.492

2.481
2.484
2.469
2.504
2.484
2.508
2.477
2.48
2.469
2.46
2.454
2.424
2.432
2.41
2.374
2.388
2.38
2.38
2.38
2.339
2.312
2.299
1916.

Per
cent.
100.64
100.48
100.48
100.48
100.16
100.16
99.72
99.84
99.24
100.64
99.84
100.80
99.56
99.24

98.63
97.43
97.75
96.87
95.42
95.98
95.66
95.66
94.01
92.93
92.40

2.273
2.228
2.247
2.286
2.36
2.374

91.36
89.55
90.31
91.88
94.86
$5.42
94.86

2.339
2.353
2.36
2.3153
2.342
2.333
2.339
2.353
2.364
2.384
2.432
2.406
2.399

94.01
94.57
94.86
94.57
94.13
93.77
94.01
94.57
95.02
95.82
97.75
96.70
96.42

2.402
2.388
2.403
2.406

96.54
95.98
96.58
96.70

2.406
2.406
2.406
2.406
2,413
2.417
2.395
2.421
2.439
2.45
2.443
2.447
2.447
2.443
2.439
2.432
2.439

96.70
96.70
96.70
96.70
96.99
97.15
96.26
97.31
98.03
98.48
98.20
98.36
98.20
97.75
98.03

London, par
12.107.

New York, par
3.731.

Rate.

Per
cent.

11.97
11.93
11.94
11.96
11.94
11.84
11.87

98.87
98.54
98.62
98.79

11.75

97.05

11.65

96.23

3.846

11.57
11.55
11.58
11.60
11.57
11.45
11.46
11.28
11.17
11.08
11.24
11.22
11.27
11.20
11.00
10.96
10.88

95.57
95.40
95.65
95.82
95.57
94.58
94.66
93.17
92.26
91.52
92.84
92.68
93.09
92.51

3.876
3.876
3.828
3.86
3.809

10.63
10.61
10.68
10.91
11.27
11.32
11.31
11.20
11.25
11.30
11.31
11.28
11.20
11.15
11.25
11.32

87.80
87.64
88.22
90.12
93.09
93.50
93.42
92.51
92.92
93.34
93.42
93.17
92.51
92.10
92.92
93.50

11.60
11.52
11.52
11.50
11.47
11.41
11.49
11.52
11.50
11.51
11.495
11.54
11.54
11.53
11.55
11.56
11.77
11.70
11.70
11.69
11.685
11.67
11.68
11.63
11.61
11.63

95.82
95.15
95.15
94.99
94.74
94.25
94.91
95.15
94.99
95.07
94.95
95.32
95.32
95.24
95.40
95.48
97.22
96.64
96.64
96.56
96.51
96.39
96.48
96.06
95.90
96.06

Rate.

Per
cent.

97.80
98.05

90.53
89.87

103.08
104.50
103.89
103.89
102.60
103.46
102.09

Stockholm.

London, par

Rate.

Per
cent.

18.15
18.20
18.30
18.275
18.55
18.75
18.55

99.95
100.23
100.78
100.64
102.15
103.26
102.15

18.40

101.33

18.20

100.23

18.25
18.20
18.20
18.25
18.20
18.10
18.05
17.95
17.70
17.50
17.60

100.50
100.23
100.23
100.50
100.23
99.68
99.40
98.85
97.47
96.37
96.92

New York, par
3.731.

3.846
3.899
3.876
3.876

3.77
3.766
3.738
3.636
3.478
3.51
3.67
3.704
3.54
3.556
3.571
3.604
3.636
3.643
3.578
3.525

95.31
95.71
96.60
97.45
97.64
95.90
94.48

3.556
3.556
3.596
3.604
3.63
3.566
3.525

3.552
3.534
3.501
3.454
3.464
3.419
3.328
3.376
3.339
3.279
3.239
3.213
3.284

95.20
94.72
93.84
92.57
92.84
91.64
89.20
90.49
89.49
87.89
86.81
86.12
88.02

3.54
3.521
3.478
3.434
3.448
3.407
3.32
3.367
3.328
3.266
3.23
3.188

3.306
3.333.
3.39
3.396

88.61
89.33
90.87
91.02

3.527
3.534
3.466
3.47
3.472
3.472
3.61

94.53
94.72
92.90
93.01
93.06
93.06
96.76
93.73
94.05
94.37
96.22
96.22
96.22
96.06
96.22
96.22
96.22

3.497

3.509
3.521
3.59
3.59
3.59

3.584
3.59

3.59
3.59

103.08
104.50
103.89
103.89
102.60
103.46
102.69

3.809

102.60
102.60
101.05
100.94
100.19
97.45
93.22
94.08
98.37
99.28
94.89

3.828

Per
cent.

Rate.

102.60
102.60
101.05
100.94
100.19
97.45
93.22 ,
94.08 !
98.37 •:
99. 28
94.89

3.828
3.77
3.766
3.738
3.478
3.51
3.67
3.704
3.54

15.85 ! 87.28

92.79
91.69
92.79
91.41
16.65 I 91.69
16.85 : •
16.65 !
16.85
16.60 i

3.293
3.339
3.384
3.378
3.521
3.534
3.466
3.47
3.472
3.46
3.597
3.472
3.497
3.472
3.509
3.497

3.521
3.496

3.515
3.509
3.50

London, par
18.159.

Rate.

Per
cent.

18.15
18.20
18.30
18.275
18.55
18.75
18.55

99.95
100.23
100.78
100.64
102.15
103.26
102.15

18.40

101.33

18.20

"i66."23

18.25
18.20
18.20
18.25
18.20
18.10
18.05
17.95
17.70
17.50
17.60

100.50
100.23
100.23
100.60
100.23
99.68
99.40
98.85
97.47
96.37
96.92

95.31
95.31
96.38
96.60
97.29 jI
95.58

94.48
94.89
94.37

93.22
92.04
92.41 !
91.32 I
88.99 i
90.24 i

89.20
87.54
86.57
85.45
87.54
|
I
I
i

88.26 i 15.85
89.49 !
90.70 i
90.54
94.37 i.
94.72 j
92.90 ;
93.01 i
93.06 :
92.74 I
96.41 : .
93.06 .
93.73 i.
93.06 !i.
94.05 .
93.73 •".
94.37 .
93.70 !.
94.21 !.
94.05 i.
93.81 !.

16.85
16.65
16.85
16.60
16.65

87.28

92.79
91.69
92.79
91.41
91.69

686

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917.

Comparative rates for cable transfers to principal neutral places in Europe based upon quotations in New York and London
since July, 1914, as reported by the National City Bank of New York City and the London Economist—Continued.
Christiania.

Amsterdam.
New York, par
2.488.
Rate.

Nov. 7
Nov. 14
Nov. 21 .
Nov. 28
Dec. 5
Dec 12
Dec. 19 .
Dec. 2 6 . . .

Per
cent.

1916.
2.443
2.443
2.45
2.447
2.447
2.443
2.447

98.20
98.20
98.48
98.36
98.36
98.20
98.36

2.447
2.443
2.447
2.447
2.45
2.454
2.454
2.465
2.473
2.473
2.481
2.477
2.469
2.462
2.454
2.424
2.439
2.435
2.439
2.435
2.417
2.424
2.421
2.417
2.424
2.402
2 424
2.417
2.421
2.417

98.36
98.20
98.36
98.36
98.48
98.64
98.64
99.08
99.40
99.40
99.72
99.56
99.24
98.96
98.64
97.43
98.03
97.87
98.03
97.87
97.15
97 43
97.31
97.15
97.43
96.54
97.43
97.15
97.31
97.15

London, par
12.M7.
Rate.

Per
cent.

New York, par
3.731.
Rate.

Per
cent.

Stockholm.

London, par
18.159.
Rate.

Per
cent.




. . . .

•«
K a tt e

I
i Per
- i cent.

London, yar
18.159.
Rate.

Per
cent.

I
11.65
11.65
11.68
11.70
11.69
11.67
11.69

96.23
96.23
96.48
96.64
96.56
96.39
96.56

11.70
11.70
11.70
11.71
11.70
11.73
11.77

96,64
96.64
96.64
96.72
96.64
96.89

|
3.60
3.61
3.617
3.59
3.534
3. 559
3.578

96.49
96.76
96.94
96.22
94.72
95.39
95.90

3.51
3.527
3.527
3.49
3.396
3.413
3.384

94.08
94.53
94.23
93.54
91.02
91.48
90.70

3.559
3.5»9
3.571
3.559
3.565
S.565
3.571
3.559
3.559
3.534
3.497
3.436
3.378
3.378
3.344
3.356
3.419
3.413
3.401
3.407
3.384
3.401
3.39
3.401
3.401
3.39
3.39
3.279
3.373
3.350

95.39
95.39
95.71
95.39
95.55
95.55
95.71
95.39
95.39
94.72
93.73
92.09
90.54
90.54
89.63
89.95
91.64
91.48
91.16
91.32
90.70
91.16
90.87
91.16
91.16
90.87
90.87
87.89
90.40
89.79

3.373
3.373
3.395
3.384
3.378
3.373
3.384
3.378
3.373
3.373
3.378
3.367
3.356
3.311
3.322
3.279
3.378
3.344
3.333
3.333
3.333
3.322
3.317
3.317
3.311
3.289
3.268
3.175
3.195
3.14

90.40
90.40
90.99
90.70
90.54
90.40
90.70
90.54
90.40
90.40
90.54
90.24
89.95
88.74
89.04
87.89
90.54
89.63
89.33
89.33
89.33
89.04
88.90
88.90
88.74
88.15
87.59
85.10
85.63
84.16

1917.
Jan. 2
Jan. 9
Jan. 16.
Jan. 23
Jan. 30. .
Feb 6
Feb. 13
Feb. 29.
Feb. 27
Mar. 6 .
Mar. 13
Mar. 20
Mar. 27
Apr. 3
Apr. 10. . . .
Apr. 17
xVpr. 24. . . .
May 1
May 8
May 15
May 22
May 29
June 5
June 12
June 19.
June 26
July 3 . .
JulvlO
July 17 .
July24... .

New York, par
3.731.

11.82
11.82
11.85
11.82
11.79
11.76
11.75
11.62
11.68
11.64
11.65
11.54

Q7.22
i 07. fiS

97.63
97.88
97.63
97.38
97.14
97.05
O S . QR

i flfi. 48

96.15
96.23
95.32

11.54
11.54
11.56
11.54

95.32

11.55
11.55

95.40
95.40
95.32

11.54

95.32
95.48
95.32

16.24

89.43

16.24
16.25
16.25
16.23

89.43
89.49
89.49
89.38

16.05 • 88.39
16.15
88.94
16.03 88.28

15.83

87.17

15.88
15.87
15.77
15.67

87.45
87.38
86.84
86.29

15.20
15.30
14.95

83.71
84.26
82.33

686

FEDERAL RESERVE BULLETIN.

SEPTBMBEK 1,1917.

Comparative rates for cable transfers to principal neutral places in Europe based upon quotations in New York and London
since July, 1914, as reported by the National City Bank of New York City and the London Economist—Continued.
Copenhagen.

Zurich.

!

Madrid.

i
New York, par
3.731.
Per
cent.

Rate.

25.55
25.55
25.52
25.50
25.55

101.29
101.29
101.17
101.09
101.29

19.38
19.37
19.45
19.45
19.47
19.60
19.65
19.68
19.75
19.80
19.60
19.48
19.00
18.70
19.00
18.70
18.60
18 55
18.525
18.45
18.30
18.20
18.15
18.20
18.30
18.275
18.55
18.75
18.55
18.40
18.20

106.72
106.67
107.11
107.11
107.22
107.93
108.21
108.38
108.76
109.04
107.93
107.27
104.63
102.98
104.63
102.98
102.43
102.15
102.02
101.60
100.78
100.23
99.95
100.23
100.78
100.64
102.15
103.26
102.15
101.33
100.23

25.55
25.55 •
25.65
25.70
25.70
25.85
26.30
26.50
26.40
26.10
26.10
26.90
25.90
25.80
25.70
25.60
25.55
25.50
25.45
25.425
25.325
25.275
25.35
25.625
26.00
25.90
25.80
25.55
25.70
25.50
25.15

101.29
101.29
101.68
101.88
101.88
102.48
104.27
105.06
104.66
103.47
103.47
106.64
102.68
102.28
101.88
101.49
101.29
101.09
100.89
100.79
100.40
100.20
100.50
101.59
103.07
102.68
102.28
101.29
101.88
101 09
99 70

18.25
18.20
18.20
18.25
18.20
18 10
102.60 18 05
102.60 17.95
102.12 17.70
101.32 17.50
100 67 17 60
97.45
94.89
94.08
99.71
100.19
95.71

100.50
100. 23
100.23
100.50
100.23
99.68
99.40
98. 85
97.47
96.37
96.92

25.20
24.90
25.00
25.00
25.00
25.00
24.97
24.95
24.85
24.77
25.15
25.15
25.30
25.25
25.10
24.95
24.95

99.90
98.71
99.11
99.11
99.11
99.11
98.99
98.91
98.51
98.20
99.70
99.70
100.30
100.10
99.50
98.91
98.91

Jan. 4
Jan. 11
Jan. 18
Jan. 25
Feb.l
Feb. 8 . . . :
Feb.15
Feb. 22
Feb. 29
Mar. 7
Mar. 14
Mar.21
Mar. 28
Apr. 4
Apr. 11
Apr. IS

34.90
24.70
24.65
24.70
24.85
24.90
25.00
25 03
25.05
25.05
25.05
25.00
24 94

98.71
97.92
97.72
97.92
98.51
98.71
99.11
99 23
99.31
99.31
99.31
99.11
98 87
98.71
98.12
98.39




(

.

. . .

3.846
3.899
3.876
3.876
3.828
3.86
3.809
3.828
3.828
3.81
3.78
3.756
3.636
3.54
3.51
3.72
3.738
3.571

19.30
19.37
19.37
19.40
19.35

Per
cent.

106.28
106.67
1Q6.67
106.83
106.56

1915.
....

Per
cent.

London, par
25.225.
Per
cent.

1914.

.

Rate.

New York, par
5.18.

Rate.

Dec. 1
Dec. 8
Dec. 15 .
Dec. 22. .
Dec. 29
Jan. 5
Jan.12 .
Jan. 19
Jan. 26
Feb.2
Feb. 9
Feb.16.
Feb.23
Mar.2..
Mar.9
Mar. 16
Mar.23
Mar. 30
Apr.13
Apr. 20
Apr. 27
May 4
Mayll
May 18
May 25
June 1
June 8
June 15
June 22
June 29
July 6
Julyl3
July 20
July27....
Aug. 10
Aug. 24. .
Aug. 31
Sept. 7
Sept. 14
Sept. 21
Sept. 28
Oct. 5
Oct. 12
Oct. 19
Oct. 26
Nov. 2..
Nov. 9
Nov. 16
Nov. 23
Nov. 30
Dec.7
Dec. 14
Dec.21
Dec. 28

London, par
18.159.

103.08
104.50
103.89
103.89
102.60
103.46
102.09

Rate.

5.34
5.42
5.33
5.29
5.28
5.27
5.26

103.09
104.64
102.90
102.12
101.93
101.74
101.55

5.29
5.35
5.32
5.31
5.335
5.32
5.32
5.31
5.31
5.26
5.25

102.12
103.29
102.71
102.51
102.99
102. 71
102.71
102.51
102.51
101.55
101.36

New York, par
5.18.
Rate.

Per
cent.

London, par
25.225.
Rate.

Per
cent.

25.90
26.00
26.00
25.85
25.20

102.68
103.08
103.08
102.48
99.90

5.263
5.33
5.29
5.23
5.23
5.263
5.23
5.23
5.23
5.23
5.23

25.45
25.25
25.45
25.23
25.225
25.15
25.00
24.90
24.75
24.30
24.50
24.40
24.20
24.05
24.25
24.25
24.60
24.80
24.95
25.20
25.10
25.20
25.30
25.55
25.80
25.95
25.25
25.15
25.15
24.90
101.60 24.90
102.41
102.41 24.95
101.60 24.90
100.29 24.80
100.97 24.85
100.29 24.80
24.93
101.60 24.90
102.90 24.87
102.12 24.95
100.97 25.00
100.97 25.15
101.60 25.22
100.97 25.15
100.97 25.18
100.97 25.10
100.97 25.16
100.97 25.10

5.263
5.236
5.195
5.249
5.249
5.249
5.249

101.60
101.08
100.29
101.33
101.33
101.33
101.33

5.163
5.23
5.195
5.195
5.195
5.128
5.096
5.128

99.67
100.97
100.29
100.29
100.29
99.00
98.38
99.00

5 263
5.305
5.305
5.263
5.195
5.23
5.195

100.89
100.10
100.89
100.02
100.00
99.70
99.11
98.71
98.12
96.33
97.13
96.73
95.94
95.34
96.13
96.13
97.52
98.31
98.91
99.90
99.50
99.90
100.30
101.29
102.28
102.88
100.10
99.70
99.70
98.71
98.71
98.91
98.71
98.31
98.51
98.31
98.83
98.71
98.59
98.91
99.11
99.70
99.98
99.70
99.82
99.50
99.74
99.50

1916.
3.571
3.588
3.62
3.663
3.663
3.61
3.54

95.71
96.17
97 03
98 18
98 18
96.76
94.89

5.20
5.12
5.15
5.155
5.175
5.20
5.225

100.39
98.84
99.42
99.52
99.90
100.39
100.87

3.552
3.559
3.525
3.464
3.478
3.434
3.339
3.384

95.20
95.39
94.48
92.84
93.22
92.04
89.49
90.70

5.23
5.233
5.22
5.215
5.21
5.203
5.18
5.175

100.97
101.02
100.78
100.68
100.58
100 44 94 on
100.00 | 24.75
99.90 i 24.82

25.03
25.10
25.08
25.12
25.12
25.14
25.12
25.11
25.11
25.08
24.95
25.00
24.80
24.82
24.70
24.60

99.23
99.50
99.43
99.58
99.58
99.66
99.58
99.54
99.54
99.43
98.91
99.11
98.31
98.39
97.92
97.52

687

FEDERAL RESERVE BULLETIN.

SEPT13J.T13EH 1, 1 9 1 7 .

Comparative ratesfor cable transfers to principal neutral places in Europe based upon quotations in New York and London
since July, 1914, as reported by the National City Bank of Neiv York City and the London Economist—Continued.
Zurich.

Copenhagen.
Now Yorlc, par
3.731.

1916.
Anr. 25

\?ay 2

A 5" a y 9
V o y 16
M a y 23
M a v 30

June 6
June 13
Juno 20
June 27

Ji>]y &
July 11
Jtilv 18
July 25
Ancr i

Aug.r 8
Aus . 35
Aug 22
4ug ?0
Sept 5
Popt. 12
Pent. 19
Sept 26
Oct 3
Oct 10
Oot 17
Oct. 24
Oct. 31
N(n~ 7
Nov. 14
Nov 21
Nov. 28
Dec 5
P e c 12
Dec. 19
Dec 26

. . .
1917.

JilTl 2

. . . . .

JaTi 9

Jaii 16

Jan. 23
Tan 30
•Feb.
f?t*Y>
Feb.
Pel)

0
1 3
20
27

. . .
.

. . .

TyfaT" 1 3

Var 20
Af>*r 2 7

\pr ^

X n r 10
•Vpr 1 7l

....

\pr 2
Mayl
MPV 815
May

•\Tov 22

May 29
JUPO 5

Juno 12
June 19
June 26
Tvlv 3
Tulv 10
Tu^y 17
July 24

-

7830—17-




Rate.

Per
cent.

3.348
3 306
3.266
3 239
3.293

89.73
88 6'
87.54
86.81
88.26

3.32
3 356
3.401
3.413

88.99
89.95
91.16
91.48

3.54
3.534
3.478
3 497
3.4S-1
3.472
3 6?3
3 636
3 656
3.623
3.636
3.656
3.636
3.636
3.663
3.683
3.676

94.89
91. 72
93.22
93. 73
93.38
93.06
97 H
97 ^5
97 99
97 11
97.45
97.99
9? 45
97 45
98.18
98.18
98.53

3.69
3.69
3.697
3.676
3.656
3.69
3.683
3.663
3.643
3.643
3.617
3 636
3.63
3.843
3.043
3.63
3.597
3.509
3.442
3.44S
3.448
3.468
3.484
3 509
3.516
3 534
3. 521.
? 472
3.484
3.478
3.466
3.448
3.419
3.431
3.401
3 419
3.401

London, par
18.159.
Roto.

For
cent.

New York, par
5.18. "
Rate.

Per
cent.

5.175
99.90
5 18 100 00
5.195 100.29
5 197 100.33
5.235 101.06
15.85

87.28

16.85
16.65
16.85
16.60
16.65

92.79
91.69
92.79
91.41
91.69

5.24
101.16
5 235 101.06
5.253 101.41
5.271 101.76
5.283
5.23
5.275
5.29
5.285
5.287
5 285
5 285
5 287
5.315
5.325
5.31
5.311
5.29
5.277
5.255
5.245

101.99
102.12
101.83
102.12
102.03
102.07
102 03
102 03
102 07
102 61
102.80
102.51
102 53
102.12
101.87
101.45
101.25

98.90
98.90
99.09
98 53
97.99
98.90
98 71

5.213
5.16
5.16
5.165
4.99
5.01
5.03

100.64
99.62
99.62
99.71
95.34
90.73
97.11

98.18
97.64
97.64
96.94
97 45
97.29
97.64
97.64
97.29
98 41
94.05
92 25
92.41
92.41
92.90
93.38
94 05
95.04
94 72
94.37
16.57 91.25
03 06
93.38
93.22 "16." 60 " 91.4i"
92.90
16.50 90.86
92.41
16.45 90.59
16.45 90.59
91.64
91.96
89.76
16.30
91.16
91.64
16.43 90.48
91.16 16.27 89.60

5.06
4.99
5.02
5.01
5.005
4.99
4.99
5.005
5.005
5.017
5.027
5.027
5.03
5.033
5.0S
5.075
5.13
5.14
5.16
5.11
5.11
5.06
5.04
4.99
4.92
4.83
4.75
4.65
4.61
4.63

97.69
96.34
96.92
96.73
96.62
96.34
96.34
98.62
96.62
66.85
97.05
97.05
97.11
97.16
98.07
97.97
99.04
99.23
99.62
98.65
9S. 65
97.69
97.30
96.33
94.99
93.25
91.70
89.77
89.00
89.39

Madrid.

London, par
25.225.
"Rate,

Per
cent.

24.85
24.90
25.05
24.95
25.03
25.03
25.10
25.20
25.25
25.25
25.30
25.25
25.25
25.26
25.28
25 28
25 27
25 37
25.50
25.45
25.38
25.35
25.20
25.20
25.13
25.00
24.97
24.90
24.70
24.63
24.50
23.65
24.00

98.51
98.71
99.31
98.91
99.23
99.23
99.50
99.90
100 10
100.10
100.30
100.10
100.10
100.1.4
100.22
100 22
100 18
100 57
101.09
100.89
100.61
100.50
99.90
99.90
99.62
99.11
98.99
98.71
97.92
97.64
97.13
93.76
95.14

24.05
24.03
23.92
23.93
23.87
23.90
23.95
23.93
24.13
24.05
24.02
24.04
24.10
24.15
24.30
24.48
24.50
24.60
24.18

95.34
95.26
94.83
94.87
94.63
94.75
94.95
94.87
95.66
95.34
95.22
95.30
95.54
95.74
96.33
97.05
97.13
97.52
95.88

24.05
23.75
23.55
23.30

95.34
94.15
93.36
92.37

22.40
22.30
22. Q0

88.80
88.40
87.22

Now York, par
5.18.
Rate.

Per
cent.

5.063
5 038
5.038
5.076
5.025

97.74
97 26
97.26
97.99
97.01

4.878
4.958
4.938
4.926

94.17
95.71
95.33
95.10

4.95
4,938
4.926
4.938
4.95
4.938
4 938
4 938
4.938
4.946
4.955
4.963
4.963
4.958
4.953
4.931
4.914

95.56
95.33
95.10
95.33
95.56
95.33
95 33
95.33
85.33
95.48
95.66
95.81
95.81
95.71
95.62
95.19
94.86

4.90
4.87
4.843
4.706
4.673
4.717
4.706

94.60
94.02
93.50
90.85
90.21
91.06
90.85

4.739
4.684
4.706
4.684
4.673
4.673
4.700
4.701
4.728
4.695
4.695
4.684
4.662
4.558
4.619
4.619
4.587
4.556
4.545
4.535
4.494
4.415
4.367
4.237
4.255
4.211
4.255
4.31
4.338
4.367

91.49
90.42
90.85
90.42
90.21
90.21
90.85
90.75
91.27
90.64
90.64
90.42
90.00
87.95
89.17
89.17
88.55
87.95
87.74
87.55
86.76
85.23
84.31
81.80
82.14
81.29
82.14
83.21
83.75
84.31

London, par
25.225.
Rule.

Por
cent;.

24.18
24.22
24.00
24.00
23.50
23.72
23.35
23.55
23.45
23.50
23.60
23.55
23.73
23.65
23.75
23 65
23 68
23.68
23.76
23.75
23.83
23.75
23.72
23.65
23.48
23.50
23.35
23.37
23.28
23.10
22.12
22.30
22.80

95.86
96.02
95.14
95.14
93.16
94.03
92.57
93.36
92.96
93.16
93.56
93.38
94.07
93.76
94.15
93 76
93.88
93.88
94.19
94.15
94.47
94.15
94.03
93.76
93.08
93.16
92.57
92.65
92.29
91.58
87.69
88.40
90.39

22.40
22.40
22.40
22.43
22.45
22.63
22.48
22.58
22.60
22.50
22.42

88.80
88.80
88.80
88.92
89.00
89.71
89.12
89.52
89.60
89.20
88.88

22.15
22.20
22.23
21.83
21.75
21.63
21.56

87.81
88.00
88.12
86. 54
86.22
85. 75
85.47

21.00
83.25
20.25
80.28
20.47 ! 81.15
20.20 : 80.08
20.50
20.75
20.80

81.27
82.20
82.46

688




FEDERAL RESERVE BULLETIN.

COURSE OF DOLLAR EXCHANGE
(CABLE TRANSFERS)
ON PRI NCI PAL EUROPEAN NEUTRAL PLACES
19/4 - 1917

R

1, 1917.

SEPTEMBER 1,1917.




FEDERAL BESEBVE BULLETIN.

COURSE OF STERLING EXCHANGE
(CABLE TRANSFERS )
ON PRINCIPAL EUROPEAN NEUTRAL PLACES
- /B1F

689

690

FEDERAL BESEEVE BULLETIN'.

INFOK

1917.

RULINGS OF THE BOARD.

Below are reproduced letters sent out from
time to time over the signatures of the officers
or members of the Federal Reserve Board
which contain information believed to be of
general interest to Federal Reserve Banks and
member banks of the system:
Bankers' Acceptances Drawn Against Shipment of Goods
from a Corporation to its Agent.
(To an individual.)

SEPTEMBEU 1,

The maturity of the draft need not necessarily
approximate the length of time involved in
the shipment in such a case, though it must be
limited to a maximum of six months, exclusive
of days of grace.
AUGUST 24,

1917.

Conversion* of a State Bank into a National Bank.
(To a Federal Reserve Bank.)

Receipt is acknowledged of your letter of
July 30, relating to the conversion into a
national bank of the
State Bank of
. It has frequently been held by the
courts that a State bank"which is converted
into a national bank "does not destroy its
identity or its corporate existence." The conversion results "in a continuation of the same
body, of the same directors and stockholders,
the same property, assets, and banking business under a changed jurisdiction." (See
Metropolitan National Bank v. Claggett, 141
U. S., 520.)
In view of the fact, therefore, that the conversion of a State bank into a national bank
does not destroy the corporate identity of the
bank it 'would hardly seem necessary for the
State bank to file an application for the surrender of its stock or for the national bank to
file an application for new stock. Under the
circumstances it would seem that the only
action necessary would be the proper changes
in the name of the member bank on the books
of your bank and if necessary the issue of new
certificates of stock with the new name to be
substituted for the old certificates. This,
however, should not be done until you have
received proper evidence that the conversion
has actually been accomplished and that the
Comptroller of the Currency has issued the
certificates called for in section. 8 of the Federal Reserve Act.
AUGUST 2, 1917..

Your letter of August 7 relating to the right
of a member bank to accept a draft drawn
against the shipment of goods by a corporation to its agent or branch, was duly received
and referred to our counsel for consideration.
In reply you are advised that, in the opinion
of the Board and its counsel, a member bank
may property accept a draft drawn against
the shipment of goods from a corporation to
its agent or branch even though no sale of the
goods is involved in the transaction.
The Federal Reserve Act authorizes any
member bank to accept drafts or bills of exchange which grow out of transactions involving the domestic shipment of goods, provided
that shipping documents conveying or securing title are attached at the time of acceptance
ana provided further that such drafts or bills
of exchange have a maturity of not more than
six months' sight to run, exclusive of days of
grace. It is the opinion of the Board, however,
that although the Act fixes a maximum maturity of six months, nevertheless, in any
case where a draft is drawn against the shipment of goods, in a transaction which does not
involve the sale of those goods, the maturity
of the draft should approximate the duration
of their transit. In such a case the law contemplates that the acceptance of the draft
should be for the purpose of financing the shipment and that it should not be the means of
furnishing a credit for any other purpose.
A slightly different situation arises, however,
in the case where a draft is drawn against the Paper Secured by Chattel Mortgage.
shipment of goods in a transaction involving
(To an individual.)
the sale of those goods, because in that case
the draft may properly be drawn and acYour letter of July 26 is received.
cepted for the purpose of financing not merely
The exact nature of the transaction to which
the shipment but also the sale of the goods. you refer is not entirely clear to me. It ap-




pears, however, that you contemplate drawing
your draft on a member bank, such draft
to be accepted by the member bank and to
be secured by collateral notes which arc, in
turn, secured by chattel mortgages on cattle.
Assuming that to be a correct statement of
the facts, the chief difficulty lies in the fact
that no national bank is authorized to accept
a draft of that character; and whether a State
bank which is a member bank would be permitted to accept such drafts depends solely
upon the laws of the State in which the bank
is incorporated.
There is no doubt, however, that any member
bank could discount your promissory note
which is secured by collateral notes, in turn
secured by chattel mortgages on cattle. Such
a note, however, would not be eligible for rediscount by a Federal Reserve Bank because of
the fact that it is not drawn for an agricultural,
industrial, or commercial purpose, within the
meaning of section 13 of the Federal Reserve
Act.
If the original note is issued for an agricultural, commercial, or industrial purpose, and if
it is discounted by a member bank with or
without your indorsement, such member bank
might properly rediscount it with a Federal
Reserve Bank, but your own note, even though
secured by the original note, is not eligible for
rediscount under any circumstances, because in
itself it is not issued for an agricultural, commercial, or industrial purpose.
AUGUST 1,

691

FEDEEAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

1917.

Loans on Real Estate.
(To a national bank.)

In reply to yours of July 11, you are advised
that in the opinion of the Federal Reserve
Board national banks are subject to the limitations imposed by section 24 of the Federal
Reserve Act, and can not make loans on real
estate except under authority of this act,
which limits the amount to an aggregate sum
equal to 25 per cent of its capital and surplus
or to one-third of its time deposits. If onethird of its time deposits exceed 25 per cent
of the capital and surplus, banks are given the
benefit of this alternative maximum.
JULY 26,

1917.

Custody of Gold, Lawful Moneys, and Federal Reserve
Notes.
(To Federal Reserve agents and banks.)

The Federal Reserve Board transmits herewith a ruling covering the joint custody and
control of gold, lawful money, and Federal
Reserve notes held by Federal Reserve Agents,
as provided in the act approved June 21, 1917.
(Inclosure.)

These funds should be kept in safes, preferably with two locks, each with a different combination, one in the control of the Federal
Reserve Agent and his representative and the
other in the control of the officers of the bank.
As the Federal Reserve Bank is jointly liable
for the safe-keeping of funds, a joint record
should be kept of all transactions.
Custody of paver pledged as collateral secur-

Purchasing Bank's Own Acceptances.
(To a Federal Reserve Bank.)

Your letter of July 23 has been received and
considered. In reply you are advised that
while the Board has ruled, as stated, that when
a bank buys its own acceptances they are to be
regarded as loans subject to the limitations of
section 5200, the right of the bank to resell or
reissue the acceptances is, in the opinion of
counsel, fully recognized by the authorities,
and where this is done thay may be treated as
acceptances outstanding and not as loans.
This would be applicable to cases where the
acceptances are sold to or rediscounted with a
Federal Reserve Bank as well as to those cases
where such acceptances are sold in the open
market.
AUGUST 1,




1917.

ity.—While the law does not require the joint
custody of the commercial paper and other
eligible securities pledged as collateral for Federal Reserve notes, it is desirable that such
collateral also be held in this manner. In this
case there would be no objection to having the
Federal Reserve Agent designate a senior employee in the discount or credit department as
his representative, and to the bank's appointing
a similar representative to act as joint custodians
of paper pledged.
Audit.—Whenever possible, it would be well
to have the auditor of the bank maintain a
continuous audit of the gold, lawful money, and
Federal Reserve notes held in joint custody.
At least once in each two months a complete
examination should be made of the accounts of
the Federal Reserve Agent and a copy of the
report sent to the Federal Reserve Board.

692

FEDERAL RESEKVE BULLETIN.

SEPTEMBER 1,1917.

LAW DEPARTMENT.
Demand deposits may include (a) individual
The following opinions of counsel have been
deposits;
(6) Government deposits; (c) bank
authorized for publication by the Board since
deposits.
the last edition of the Bulletin:
(a) No provision of the act can be construed
Deductions in Determining Reserves.
as
authorizing any deduction from individual
Member banks, in determining the amount against
deposits
or time deposits. The depositor may
which reserves must be carried, may deduct all Government deposits, except postal savings deposits, from the be indebted to the bank for money borrowed
amount of gross demand deposits, and may deduct from but no offset is allowed on account of such
the amount of balances due to other banks the amount of
indebtedness.
balances due from other banks, and may include in the
(b) Government deposits (except postal savamount due from banks checks drawn on banks located in
the same place and exchanges for clearing houses. The ings deposits which are time deposits) are exlaw, however, does not permit member banks to deduct empt from all reserve requirements under
checks on other banks located in the same place or ex- authority of the act of April 24, 1917, and the
changes for clearing houses from gross demand deposits,
total amount of such deposits may be denor does it permit cash on hand to be deducted from gross
ducted from demand deposits in computing
demand deposits.
reserve.
J U L Y 19,
1917.
(c) In the case of bank deposits, the Act proSIRS: AS joint counsel for the Federal Reserve Board and the Comptroller of the Cur- vides—
rency, this office has been requested to file
In estimating the balances required by this
an opinion on the subject of what, if any? act, the net difference of amounts due to and
deductions may be made from the liabilities of from other banks shall be taken as the basis
member banks in determining the amount for ascertaining the deposits against which required balances with Federal Reserve Banks
against which reserve must be carried.
shall be determined.
Section 19 of the Federal Reserve Act, as
This language has heretofore been construed
amended by the acts approved August 15,
1914, and June 21, 1917, definitely fixes the as authorizing member banks to deduct the
amount and character of reserve to be main- aggregate amount due from other banks from
tained. Each member bank is required to the aggregate amount due to other banks, and
maintain with the Federal Reserve Bank of to carry reserve only against the net balance
its district an actual net balance equal to not due to other banks. The circumstances under
less than a fixed per cent of the aggregate of which this provision was incorporated in the
its demand deposits and a fixed per cent of act, which will be later referred to, clearly indiits time deposits. The amount fixed varies cate that this construction is consistent with
according to whether the banks are located in the intent of Congress. In determining the
reserve, central reserve, or nonreserve cities, amount due from other banks, it has been cusbut with the exception of the variations in the tomary, for years past, to permit national
amount the requirements are identical in each banks to treat the total amount of items placed
case.
in the mail and charged to the account of a
Demand deposits are expressly defined as all correspondent as part of the balance due from
deposits payable within 30 days.
stich correspondent. In conformity with this
Time deposits, under the terms of the act, custom member banks are still permitted to
comprise all deposits payable after 30 days, all treat out-of-town items in this way.
savings accounts and certificates of deposit
In order that items payable in the same city
which are subject to not less than 30 days7 in which the member bank is located may be
notice before payment, and all postal savings placed on a parity with items payable elsedeposits.
where, member banks are likewise permitted




SEPTEMBER 1,

1917.

FEDERAL RESERVE BULLETIN.

693

to treat checks on other banks in the same place passage of the Federal Reserve Act were
and exchanges for clearing houses as balances justified, it seems clear that since Congress has
due from other banks, and to deduct the aggre- specifically defined deposits against which
gate of such items from the aggregate balance reserve must be carried, and has specifically
due to other banks. This ruling of the depart- authorized certain deductions to be made,
ment seems also to be consistent with the pur- there is no present justification for reading into
poses of the Act as indicated by the history of the Act any intention on the part of Congress
to allow other deductions not specifically
this legislation.
mentioned.
Prior to the Act of May 30, 1908, generally
Notwithstanding the liberal interpretation
known as the Aldrich-Vreeland Act, no deducthat
has been placed upon the Act in defining
tions were allowed by statute. In order, howbalances
due from other banks, it has been
ever, to afford some relief from the rigid reclaimed
that
the amount against which reserve
serve requirements which at that time necesmust
be
carried
should be still further reduced
sitated the maintenance of a much higher re(a)
by
permitting
checks on other banks in
serve than is required at present, the departthe
same
place
and
exchanges for clearing
ment permitted national banks to deduct from
houses
to
be
deducted
from gross demand
liabilities against which reserve must be cardeposits
rather
than
from
balances due to
ried (a) Government deposits, (6) balances due
other
banks;
(6)
by
permitting
cash on hand
from other banks (including checks on other
to
be
deducted
from
gross
demand
deposits.
banks in the same place and exchange for clearing houses), (c) national-bank notes.
The argument advanced in favor of the
It is not entirely clear under what authority allowance of these deductions should, in the
these deductions were allowed. National opinion of this office, have been addressed to
banks, however, were required at that time to Congress rather than to the Federal Reserve
maintain a certain reserve against "deposits." Board or the Comptroller of the Currency. As
The act was not specific as to what should be above stated, neither the Federal Reserve
treated as deposits and so this language was Board nor the Comptroller are vested with any
probably construed to mean deposits which discretion to permit deductions not specifically
were not offset by assets which could be used authorized by the Act and could not, in the
for the immediate discharge of such liabilities. opinion of this office, justify a ruling that banks
The Aldrich-Vreeland Act ratified in effect might deduct cash or other items from their
the ruling of the department in so far as it gross demand deposits in computing their
related to Government deposits. The act ex- reserve.
Respectfully,
pired by limitation on June 30, 1916, but the
M. C. ELLIOTT, Counsel.
act of April 24, 1917, above referred to, reTo the FEDERAL RESERVE BOARD AND THE
enacted the provisions exempting Government
deposits from reserve requirements. The Fed- COMPTROLLER OF THE CURRENCY.
eral Reserve Act specifically authorizes the
deduction of balances due from other banks, Private Bankers as Members.
but this office is advised of no other provision The Federal Reserve Act does not permit a private
banker to become a member bank, nor does it permit
of law authorizing any deduction from the Federal Reserve Banks to extend clearing privileges to
amount against which reserve must be carried such a banker.
JULY 30,
1917.
by member banks and no discretion is vested
SIR: The accompanying letter from a certain
either in the Federal Reserve Board or the
Comptroller of the Currency to permit such firm of private bankers raises two questions:
First. Whether a private banker may bedeductions.
Without passing upon the question whether | come a member of the Federal Keserve
or not the deductions allowed prior to the ' System.




694

FEDERAL RESERVE BULLETIN.

Second. Whether a Federal Eeserve Bank
under authority of section 13 of the Federal
Eeserve Act, as amended, may receive deposits and extend the clearing privileges to a
private banker.
Under the terms of the Federal Reserve
Act no banks are eligible to membership
except national banks and those " incorporated by special law of any State or organized
under the general laws of any State or of the
United States."
In the opinion of this office private bankers
do not come within this classification. Congress manifestly intended to admit to membership only incorporated banks. The language " organized under the general laws of
any State77 is ordinarily used to refer to
corporations which have obtained charters,
under the general laws of the State as distinguished from those which have been chartered by special acts of the legislature. In
this view, assuming that the firm under consideration was not incorporated either under
State or Federal law, it would not be eligible
for membership in the Federal Reserve System.
In answer to the second inquiry, section 13
provides that—
Any Federal Reserve Bank * * * solely for
the purposes of exchange or of collection may
receive from any nonmember bank or trust
company deposits of current funds * * * and
drafts payable upon presentation; or maturing
notes and bills: Provided, such nonmember
bank or trust company maintains with the
Federal Reserve Bank of its district a balance
sufficient to offset the items in transit held for
its account by the Federal Reserve Bank.
The first section of the act provides that—
Wherever the word "bank" is used in this
act, the word shall be held to include State
bank, banking association, and trust company,
except where national banks or Federal
Reserve Banks are specifically referred to.
The terms " State bank, banking association,
and trust company" are not ordinarily used
to indicate private bankers. In those acts in
which Congress has undertaken to deal with
private bankers as a class, such bankers
have been expressly referred to in the act.




SEPTEMBER 1,

1917.

In the opinion of this office, therefore, it
would require a forced construction of the
language used to reach the conclusion that
Congress intended the word " b a n k " as used
in section 13 to include private bankers and
in this view Federal Reserve Banks are without authority to extend the clearing privileges
to such bankers.
Respectfully,
M. C. ELLIOTT,

Counsel.
To HON. W. P. G. HAEDING,

Governor Federal Reserve Board.

Section 22, Federal Reserve Act.
Any violation of the provisions of section 22 of the
Federal Reserve Act by officers, directors, or employees
of a member bank constitutes a crime, punishable by
fine or imprisonment. No ruling or interpretation by
the Federal Reserve Board would afford any protection
to a person subsequently indicted by a Federal grand
jury for any such violation, it not being within the province of the Federal Reserve Board to make an official
ruling on the provisions of this section. Whether or not
a contemplated transaction comes within the prohibited
part of this section is a question which should be determined by the counsel for the bank in each case. The
Board, however, may properly suggest ways in which
member banks and their officers and directors may make
a matter of record the affirmative action required by law
as a condition precedent to certain transactions authorized by the act.
AUGUST 14,

1917.

SIR: The attached papers raise sundry
questions with reference to the proper interpretation of the recent amendment to section
22 of the Federal Eeserre Act. These questions may be briefly summarized as follows:
(1) Is it necessary that the board of directors should authorize the receipt on deposit of
checks, drafts, or other items payable on
demand from officers or directors of the
bank ?
(2) Where an officer or director is a member
of a firm or a stockholder in a corporation
which is a customer of the bank, is it necessary that a majority of the directors should
approve loans made to such firm or corporation?

SEPTEMBER 1, 1917.

FEDERAL BESEBVE BULLETIN.

(3) Would it be consistent with the purposes
of the Federal Reserve Act to substitute for
the resolution proposed by the Federal Reserve
Board a written form of assent to be signed by
a majority of the board of directors?
In reply to these several inquiries it is
respectfully submitted that the Board should
adhere to its established policy of not undertaking to determine in advance whether a
given transaction constitutes a violation of
section 22. Inasmuch as a violation of the
provisions of this section is made a criminal
act subject to a severe penalty, the Board
has no jurisdiction in the matter, and, as an
administrative body, should not undertake to
prejudge any case that may arise.
While the Board should not for reasons
stated endeavor to express definite opinions
on concrete cases arising, there would seem
to be no objection to its advising the banks
as to its understanding of the general purpose
of this amendment, just as it approved in a
former instance an opinion of this office
dealing with the general purpose of section
22.1 In this view, considering the context and
the circumstances under which this amendment was added, it seems that Congress
intended to remove any doubt as to the right
of banks to receive deposits from directors
under the same terms and conditions as it
receives deposits from their customers and to
pay such rate of interest as it -psijs to other
customers. It also intended to remove any
doubt as to the right of any bank to make
loans to directors on the same general terms
and conditions that it makes loans to its
customers, it being provided in the latter case
that as a condition precedent the directors, by
an affirmative vote or written assent of at
least a majority of the members of the Board,
shall authorize such loan. The receipt of
deposits under an agreement to pay interest
would seem to contemplate the receipt of
checks, drafts, and other demand items on deposit, as well as the receipt of money or cur-




i See May. 1915, Federal Reserve Bulletin, p. 16.

695

rency, but whether or not giving immediate
credit to a director for such items may be construed as a loan until the item is actually
collected involves a question of law upon which
the Board should not express a definite opinion.
If the counsel for the bank should reach the
conclusion that the courts might construe
such a deposit to be a loan, the bank could by
resolution of the Board authorize the receipt
of such items, but this is a question which
should be determined by the bank's counsel.
In like manner, a loan to a firm or corporation
in which the director is interested might or
might not be construed by the courts to be a
loan to the director within the meaning of this
act; and so counsel for the bank should determine whether these transactions should be
included within the resolution referred to.
While this statute, a penal statute, would in
all probability be strictly construed by the
courts so as to avoid the possibility of including
transactions not contemplated by Congress,
the Board should not undertake to rule on the
substance of any transaction or to express an
opinion as to whether it would or would not
constitute a violation of law. It should confine its attention to a consideration of those
acts which are designed to make it a matter
of record on the minutes or records of the bank
that the officers have taken the affirmative
action called for, and, to this end, the Board
has heretofore suggested a form of resolution2
to be passed by the directors of the bank
giving their assent to loans to directors. In
this connection it might be stated that the
substitution of the written assent of a majority
of the directors for the affirmative vote of a
2 Resolved, That the president, cashier, or assistant cashier of this
bank be, and he is hereby, authorized to discount notes, drafts, or bills
of exchange for
, a director of this bank,
en the same terms and conditions as other notes, drafts, bills of exchange
or other evidences of debt are discounted for customers of the bank;
Provided, The aggregate amount of such notes, drafts, and bills of exchange discounted for such director and remaining unpaid shall at no
time exceed the sum of $
: Provided further, That in any
case in which any note, draft, or bill of exchange is discounted under
authority of this resolution, a report shall be made thereof at the next
subsequent meeting of the executive and discount committee of the
board and such report shall show the aggregate amount of liabilities
of such director to this bank.

696

FEDEBAL RESEBVE BULLETIN".

SEPTEMBER 1,1917.

majority would seem to be in accordance with
As a result, it is the opinion of this office
the terms of the act.
that the drawer of the draft is not liable to
Respectfully,
the bank for money borrowed within the
M. C. ELLIOTT, Counsel. meaning of section 5200 after the bank has
To Hon. W. P. G. HARDING,
rediscounted it with the Federal Reserve Bank.
Governor, Federal Reserve Board.
The status is then identical with, the case
discussed in the opinion of October 27, 1916,
Acceptances of Member Banks.
An acceptance which has been purchased by the ! where it was held that the mere acceptance
accepting bank and subsequently rediscounted with its | of a draft did not make the drawer liable to
Federal Reserve Bank is not subject to the limitations of • the bank for money borrowed. In other words,
section 5200 of the Revised Statutes.
the transaction comes within the limitations
JULY 28, 1917.
of section 5200 only in the case where the
SIR: In reply to your memorandum of accepting bank holds its own acceptance purJuly 19, you are advised that in an opinion j chased before maturity and in the case where
filed by this office on October 27, 1916, and the drawer has failed at maturity to provide
printed in the December, 1916, Bulletin, it was funds with which the accepting bank can make
stated that the mere acceptance of a draft by payment.
a national bank does not make the drawer of
Respectfully,
that draft liable to the accepting bank for
M. C. ELLIOTT, Counsel.
money borrowed within the meaning of section I To Hon. JOHN SKELTON WILLIAMS,
5200 of the Kevised Statutes; but it is also
Comptroller of the Currency.
stated that, though the accepting bank may
legally purchase its own acceptance, nevertheless, if it does so the acceptance then Powers of State Banks Which Become Members.
becomes subject to the limitations of section
A State bank which becomes a member of the Federal
5200.
Reserve System may continue to make loans to one cusThe question presented in your memorandum tomer in excess of 10 per cent of its capital and surplus,
is whether an acceptance which has been pur- provided it is authorized to do so under the laws of the
State in which it is located. The obligations of any one
chased by the accepting bank and subsequently customer to whom the bank has loaned more than 10 per
rediscounted with its Federal Ileserve Bank re- cent of its capital and surplus would not, however, be elimains subject to the limitations of section 5200. gible for rediscount with the Federal Reserve Bank.
Any State bank which becomes a member of the FedAfter the accepting bank has purchased and
eral
Reserve System must subscribe to the capital stock
rediscounted its acceptance with the Federal
of its Federal Reserve Bank in an amount equal to 6 per
Reserve Bank, the legal relations between the cent of the capital and surplus of the subscribing bank.
accepting bank and the drawer of the draft
JULY 25, 1917.
are precisely the same as they were before the
SIR:
The
attached
letter
has
been referred
accepting bank purchased the draft. The
to
this
office
for
an
opinion
on
the
questions
fact that the accepting bank may have insubmitted.
The
writer
asks
to
be
advised—
dorsed the acceptance when it was rediscounted
with the Federal Reserve Bank does not alter
If, after its admission to the Federal Rethe legal relations between that bank and the serve system, a New York State bank can condrawer. The accepting bank is ultimately tinue to loan to its customers 40 per cent of
capital and surplus when sufficient collatliable in any event and the indorsement, its
eral is deposited with them ?
though it may have the effect of guaranWhat amount of stock is to be subscribed
teeing prior indorsements, does not affect the by a bank with a capital of $300,000 and a surplus of $300,000 %
bank's relations with the drawer.




SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

Section 9 of the Federal Reserve Act as
amended does not limit the amount that a
State bank or trust company becoming a member of the Federal Reserve System may lend
to one person, firm, or corporation. It does,
however, provide—
That no Federal Reserve Bank shall be permitted to discount for any State bank or trust
company notes, drafts, or bills of exchange of
any one borrower who is liable for borrowed
money to such State bank or trust company
in an amount greater than ten per centum of
the capital and surplus of such State bank or
trust company, but the discount of bills of exchange drawn against actually existing value
and the discount of commercial or business
paper actually owned by the person negotiating the same shall not be considered as borrowed money within the meaning of this section. The Federal Reserve Bank, as a condition of the discount of notes, drafts, and bills
of exchange for such State bank or trust company, shall require a certificate or guaranty to
the effect that the borrower is not liable to
such bank in excess of the amount provided by
this section, and will not be permitted to become liable in excess of this amount while such
notes, drafts, or bills of exchange are under
discount with the Federal Reserve Bank.
While the State bank may, therefore, lend
to one customer an amount equal to 40 per
cent of its capital and surplus, if it is permitted
to do so under the State law, the obligation of
such customer would not be eligible for rediscount with the Federal Reserve Bank.
In answer to the second inquiry: State banks
becoming members are required to subscribe to
the same amount of stock that they would be
required to subscribe if they entered the system
as national banks. National banks are required to subscribe to an amount equal to 6 per
cent of their capital and surplus. One-half of
this amount is paid in in installments and the
remaining one-half remains subject to the call
of the Federal Reserve Board.
The whole subscription of State banks becoming members is payable on call of the Federal Reserve Board, but as only 3 per cent is




697

paid in by national banks, State banks would
not be called upon to pay more than this
amount unless it should later become necessary
for the Federal Reserve Board to call for additional subscriptions from all member banks.
A State bank, therefore, entering the system
with $300,000 capital and $300,000 surplus
would be required to pay in $18,000 and the
remaining $18,000 would be subject to call of
the Federal Reserve Board and would be called
only in the event that all member banks were
called upon to make additional subscriptions.
Respectfully,
M. C. ELLIOTT, Counsel.
To Hon. W. P. G. HARDING,

Governor Federal Reserve Board.

Laws of Washington Authorizing National Banks to Act
as Trustees.

By an act of the Legislature of the State of
Washington, approved March 10, 1917, national banks located in Washington are permitted under certain circumstances to exercise
the powers of a trust company. The law provides, in part, as follows:
"SEC. 16. A national bank located within
this State and having a paid-up capital of
$50,000 or more, when authorized or permitted
so to do, by or under any act of the Congress of
the United States, may exercise any of the
powers conferred upon trust companies by this
act.
"SEC. 17. Before any such national bank
shall engage in such trust business, it shall file
a certificate with the State bank examiner,
wherein it agrees to conform to all the regulations and restrictions of this act relating to
trust companies and trust business, including
the examination of its trust business by said
examiner and the payment of the fees therefor, herein prescribed for the examination of
banks and trust companies. Upon the filing
of such a certificate in a form to be approved
by said examiner, such national bank shall be
subject to all the regulations and restrictions
of this act relative to trust companies and trust
business/'

698

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

SUMMARY OF BUSINESS CONDITIONS AUGUST 23, 1917.
District No. 1—
Boston.
General business
Crops:
Condition
Outlook
Industries of the district.
Construction, building, and engineering.
Foreign trade
Bank clearings
Money rates

Spotty.

District No. 2—
New York.

Good, but with Good.
some seasonal
dullness.

Below normal
acreage will
, Large
give b u m p e r
crops.
Well engaged, but
Busy..
several lines not
at maximum.
Nearly up to previ- Building construcous high record.
tion continues
extremely dull.
Large
Well maintained..
C o n t i n u e d inIncrease
crease.
Firm and for some
Firm
weeks past quite
steady.
, ! Railroad receipts
Railroad, post office, Decrease
at record levels;
and other receipts.
postal receipts
normal.
Well employed.... Shortage of labor;
Labor conditions
wages high.
Good
Good

Outlook.

Uncertain..

Remarks.

Business generally
waiting m o r e
definite view of
the future.

District No. 7—
Chicago.
General business
Crops:
Condition

Somewhat unset- Highly
tory.
tled.
Good
Favorable

Excellent.
....do

Busy..

Hesitating.

Active and profit- Operating
able.
mum.
Restricted by lim- Slow.
ited labor and
high wages.

Falling off in Improved..
number of operations.
Very large
Increase
, Increased.
No change.
Steady
Increasing..

Increased.

Unsettled

Fair

District No. 9—
Minneapolis.

....do

Demoralized by Fair.
high wages paid
on Government
contract.
Very satisfactory.. Good.

War revenue and
price fixing
measures retarding c o m m i t ments for future
operations.
District No. 10—
Kansas City.

District No. 11—
Dallas.

District2No.*12—
San^-Francisco.

Less active

Good

Active.

Harvest in full Much improved... Good except in
swing.
south, south central, and southwest portions.
Encouraging
Favorable
Busy,
with
war
Active and runActive
orders promining full time.
nent.
7
Less than year ago. Less activitj Decrease due to
midsummer season.
Increase over similar period 1916.
Increasing
, Marked increase... 32£ per cent increase over lulj,
1916.
Generally
stationNo
change; deFirm
mand good, but
ary.
funds ample for
requirements.
Railroad increase;
Increase.
Increase
post office small
decrease.
Shortage and more Unsettled.
Fairly good
than usual unrest.
Good
Optimism prevails Extremely favorable.
Business has re- Drought still obvived substantains over south,
tially with imsouthwest, and
proved crop con- extreme western
ditions.
portions of the
district; ranges
in bad condition
and cattle industry heaviest
sufferer.

Promising.,
Active
Somewhat
stricted.

Foreign trade...
Increasing..

Increase

Money rates

Firm

No change

Railroad, post office, Decreasing.
and other receipts.

Railroad gross receipts increase;
post office increase.
Fair

Labor conditions

Good

Outlook,.

..do..
Favorable
Business seems to Crop conditions
be awaiting defihave improved.
nite advice with
regard to taxation.

Do.
Do.

7% increase... e ... Increase.
5 to 6%; fair de- Stationary.
mand and supplyLarge volume, but Increase.
no improvement
in railroad net.

Good

Good

District No. 6—
Atlanta.

satisfac- Good.

Good

Bank clearings..




District No. 5—
Richmond.

.....do
....do

War r e a d j u s t - Good..
ments progressing well; outlook
good.

District No. 8—
St. Louis.

District No. 4
Cleveland.

Fair; some hesita- Satisfactory.
tion.

do..
Outlook
Industries of the dis- Active.
trict.
Construction, build- Slow.
ing and engineering.

Remarks.

District No. 3—
Philadelphia.

Good.

Active.
Slight increase.
Large; increasing,.

Firmer tendency..
Increasing.
Unsettled.
For great activity..

SEPTEMBER 1, 1917.

FEDEBAL RESERVE BULLETIN.

699

GENERAL BUSINESS CONDITIONS.
There is given on the preceding page a summary of business conditions in the United
States by Federal Reserve districts. The reports are furnished by the Federal Reserve
Agents, who are the chairmen of the boards of
directors for the Reserve Banks of the several
districts. Below are the detailed reports as of
approximately August 23 :
DISTRICT NO. I—BOSTON.

Midsummer finds business on the whole
good, but decidedly spotty, with no definite
trend apparent. It is not unusual to find one
department of a business busy, with advancing prices, and another quiet, with prices
sagging. The predominant feature in all
lines of business is caution, and every one is
reluctant to make commitments until the
future course of affairs can be more definitely
analyzed. Government orders are a large
factor, but the high wages paid labor can not
be disregarded as creating a large domestic
buying power. For this reason it is felt that
as long as conditions continue as at present
business will be good, and there is confidence
in the prospects for good trade later in the
season.
The boot and shoe manufacturer is still
finding the retailer reducing his stock rather
than placing new orders. Manufacturers have
for a good while urged this policy on the ground
that, although prices were advancing, it was
poor business to overstock only to find, wiien
the time came to realize, that styles had
changed and a sacrifice was inevitable. Retailers are apparently heeding these warnings,
and more careful purchasing is to be expected.
At present Government orders are keeping
manufacturers busy.
Wool dealers have offered to the Government
50 per cent of the wool held by them, the option
to run for two weeks, at prices ruling the week
of July 30. Experts are at present appraising
samples offered and, pending definite action
by the Government, trading is quiet with prices
firm. If the project works out favorably, man-




ufacturers bidding on Government work will
have the option of furnishing the wool themselves or having it furnished by the Government. Reports from both woolen and worsted
mills indicate that practically all available
machinery is busy. A large part of this machinery is engaged on Government work, in the
case of woolen spinning spindles the percentage
being as high as 33-| per cent.
The market for fine and fanc}^ cotton goods
is quiet, the only feature being some Government buying. Prices have stopped advancing
and in some cases slight recessions are in evidence. Production is curtailed by lack of operatives and by the selling of surplus yarns by
manufacturers who will not manufacture goods
to sell at lower prices. Print cloth mills are
well sold ahead, but are also curtailing somewhat because of shortage of labor.
The crops have been materially helped by
recent rains. A large yield of hay of excellent
quality has been secured. Potatoes are doing
well, as are oats and corn, although the latter
is some weeks behind. Apples continue to fall
from the trees and indications are that the crop
will be poor. Peaches are in excellent condition, with prospects good.
Money is not overabundant in this district,
and except in one or two of the larger centers
little commercial paper is moving, banks
simply taking care of the needs of their own
customers. The general trend of money,
especially on time, is upward rather than downward, as is usually the case at this time of the
year, when banks are called upon to make
advances on wool and other crops as they come
to the market. This, together with the final
payments on the Liberty Loan and other
Government financing, has kept banks in this
district moderately well loaned up, but with
the redepositing of Government funds the
banks have been able to finance themselves,
for the most part, without recourse to the
Federal Reserve Bank for rediscounts to more
than a moderate extent. Call money, 4£ to 5

700

FEDERAL RESERVE BULLETIN.

per cent, the former rate prevailing for quick
call. Six-month money is quoted at 5 to 5-|per cent, according to names and collateral,
and short commercial paper has sold as low
as 4f- per cent. Town notes, fall maturities,
4 per cent; bankers' acceptances, 90 days, 3§
per cent upward.
Loans and discounts of the Boston Clearing
House banks on August 11, 1917, amounted to
$451,796,000, as compared with $479,936,000
last month and $418,825,000 on August 12,
1916. Deposits on August 11, 1917, totaled
$358,845,000, as compared with $379,176,000
on July 14, 1917, and $321,999,000 on August
12, 1916. The amount "due to banks' 7 on
August 11 was $124,266,000, as compared with
$137,610,000 on July 14, 1917.
Exchanges of the Boston Clearing House
for the week ending August 11, 1917,
were $211,659,320, compared with $158,108,531
for the corresponding week last year and
$269,952,416 for the week ending August 4,
1917.
Building and engineering operations in
New England from January 1 to August 1,
1917, amounted to $118,582,000, as compared
with $120,806,000 for the corresponding period
of 1916, the highest previous year recorded.
The receipts of the Boston post office for
July, 1917, show an increase of $25,825.40, or
about 4 per cent, more than July, 1916. For
the first 15 days of August, 1917, receipts were
about 1 per cent, or $3,131.49 less than for the
corresponding period last year.
Boston & Maine Railroad reports net operating income, after taxes, for June, 1917, as
$872,402, as compared with $1,415,604 for the
corresponding month of 1916. New York,
New Haven & Hartford Railroad reports net
operating income, after taxes, for June, 1917,
as $1,819,613, as compared with $2,130,884
for the same month last year.
DISTRICT NO. 2—NEW YORK.
Midsummer has brought a seasonal lull in
business and industry, contributing factors
being the waiting attitude of those most
directly interested in Government price fixing,




SEPTEMBER 1,

1917.

and continuing conservatism on the part of
buyers at wholesale and retail. Manufacturers
for the most part are buying raw materials
only in quantities sufficient to care for orders
in hand, and there has been general adoption
of the practice of setting aside special reserves
to meet possible losses occasioned by changes
in price levels or buying demand during and
after the war. Decreased buying of steel products by private interests has made for easier
conditions in the steel trade, as is indicated
by the decrease of unfilled orders of the Steel
Corporation to 10,844,164 tons, the lowest
since October, 1916, with a further decrease
expected during August.
By national cooperation the railroads effected
a reduction in car shortage from 148,627 on
May 1 to 33,776 on August 1, in the face of
unprecedented demands for freight service and
with material increase in gross and net railway
earnings. Lessened activity in such lines as
building materials, building construction work,
furniture, musical instruments, civilian clothing, automobiles, etc., has permitted transfer
of labor and supplies to other industries or
other branches of the same industry in which
activity has increased. Labor conditions in
this district are less acute than in past months,
except as to farm labor. Wages have continued to advance and serious strikes have been
avoided, the important exception being the
strike of employees of shipbuilding plants
which is now in progress.
Owing to a planted acreage in this district
far above normal, bumper crops of hay, potatoes, and vegetables are expected. Wheat,
oats, barley, and rye will also yield well, but
the corn crop is expected to be only fair. The
fruit yield will be much short of normal. Food
prices have fallen somewhat since the coming
to market of new crops and apprehension as to
a possible food shortage is much lessened.
Stock-market trading has been quiet for
many weeks past, though the number of shares
handled has been greater than for the same
weeks last year. The public has shown little
interest in the market, and since the middle

:SEPTEMBKE 1,1917.

FEDEEAL RESEBVE BULLETIN.

of July prices have shown little general change.
Bond sales have ruled below those for the same
weeks last year, but prices have been steady
since early July. Advantage has been taken
of the period between Liberty loans to bring
out several corporate issues of short-term securities at attractive interest rates, which have
been readily absorbed by the market. The
placing of $100,000,000 two-year gold notes in
this market hy the Canadian Government to
yield 6.07 per cent has been perhaps the most
striking single transaction of the month, the
$300,000,000 issue of United States 3 i per cent
Treasury certificates on August 9, of which
$175,000,000 was placed in this district, being
taken quite as a matter of course.
Banking conditions are satisfactory. Required reserves of all members of the Federal
Reserve System have been transferred to the
Federal Reserve Bank, thus greatly increasing
its gold holdings and ability to extend credit
to meet any situation. Its gold and lawful
money holdings on August 20 were $642,000,000
or 85 per cent of liabilities. Loans and discounts which on June 19 stood at $252,000,000
were on August 20 only $67,500,000.
DISTRICT NO. 3—PHILADELPHIA.

There has been no important development
in the business situation in this district during
the past month. A strong tendency toward
caution exists on the part of buyers, owing to
the uncertainty of future prices and the high
cost and scarcity of many kinds of goods.
There is a steady readjustment to war conditions, but business men generally expect that
fall and winter trade will be active.
No decrease in industrial activity is reported,
except such as is due to weather conditions.
Retail distribution is largely confined to seasonable merchandise. Concerns handling
young men's clothing, laces, embroideries, etc.,
have been adversely affected.
Government orders for cotton are large, but
the regular commercial trade is unsettled.
The actual turn-over is not larger in quantity
than a year ago. Prominent cotton houses
expect a decline in the price of cotton.




701

The wool market is awaiting the action of
the Government in fixing prices, as it is said
that the Government needs 50 per cent of the
wool in the hands of dealers. Civilian business is very dull, as people are loath to buy
wool at prevailing high prices.
Textile manufacturers are busy, although
consumption is generally less than a year ago.
Member banks continue to avail themselves
quite freely of the rediscount feature of the
Federal Reserve Bank. Local institutions
are well loaned up, and the money market is
on a firm 5 per cent basis. There is a good
commercial demand for funds. Public interest
in the security markets is at a low ebb.
DISTRICT NO. 4—CLEVELAND.

It is rather difficult intelligently to analyze
business conditions at this time, chiefly for
two reasons—a lack of precedent and an unusually spotty condition due to the necessary
Governmental preferences which are being
given to certain lines of manufacture. There
is a good deal of hesitancy with respect to new
undertakings, doubtless due to the question of
price fixing which is now so prominent.
The outlook for business, however, is excellent, once the two disturbing elements of price
and distribution are fixed.
Reports from all localities in this district,
with very few exceptions, indicate that one of
the largest crops in history will be raised this
year. A very large wheat and oat crop has
been harvested, considerable threshing has
been done, and the yield is heavy. The
weather generally has been favorable for corn,
and a good crop is now well under way.
There is no doubt that farmers in this district
have considerably underestimated their crops.
Burley tobacco is doing well. Quality and
quantity are up to average, and possibly a
little better than last year.
Altogether, agricultural conditions in this
section have never been so promising as at the
present time.
The steel business is less active than last
month, although nearly all the mills are still
booked to capacity. There is less overtime in

702

FEDERAL RESERVE BULLETIN.

the mills than prevailed a few months ago.
The obligations of mills to their domestic trade
are being interfered with to some extent by
the constantly increasing demands of the
Government. The maximum tonnage of iron
ore that the boats and railroads can handle is
being moved, and this high volume no doubt
will continue until the end of the shipping
season. The pig-iron market is quiet, as manufacturers are waiting to see what the Government will do about price fixing.
Cement companies are not running much
over 50 per cent capacity. There has been a
very decided slump in the clay product business within the last 30 days.
There is a frantic demand for fuel on the
part of all users of bituminous coal and operating companies. On account of an inadequate
car and labor supply, the mines are having
difficulty in producing a sufficient tonnage to
take care of requirements. Unless some relief
is afforded in the transportation facilities to
the Northwest, that section will suffer severely
through insufficient fuel supply.
While the manufacture of motor-truck tires
and balloon fabrics is more active than ever
before, the balance of the rubber industry is
only fair, due to the falling off in sales of
pleasure cars. Some of the companies are
working only five days a week, and others
have eliminated the third shift.
The glass and pottery business appears to be
in excellent condition, and a fine fall business
is anticipated. Some of the factories are
making extensive improvements to their plants.
The recent advances in crude oil have again
stimulated that industry, which is already in
a very prosperous condition.
Building operations are still in an unsatisfactory condition. Large building is at a
standstill. Money for building and real estate
operations is very scarce, which, together with
the shortage of labor and the high cost of materials, is affecting unfavorably the building line.
All of our reports this month contain complaints on the labor situation. Increasing diffi-




SEPTEMBER 1,1917c

culty in securing male labor for the various
industries is commented upon.
Mercantile business is only fair. The effect
of economies, both voluntary and enforced, is
being felt. Manufacturers engaged in supplying jobbers and retailers are showing caution
in the matter of contracts both for purchase
and sale.
While collections in some parts of this districtare reported as improved over last month, yet
most of our correspondents report slower payments. Many of the larger companies state
that their collections are coming in considerably
behind the estimate for the month.
There is a continued active demand for loans
throughout the district, and the rates are steady
at 5£ and 6 per cent for both time and demand
paper. Banks seem to be fully taking care of
customers, but it is a lender's market.
The investment securities markets are less
active than formerly, and prices have receded
generally.
More recently the deposit lines in the important centers have shown substantial increases
in both demand and time.
DISTRICT NO. 5—RICHMOND.

Business in general continues unusually
active, particularly for this time of year,
especially in manufacturing lines. The conditions existing at the present time are so
unusual and in their effects present such widely
diversified features that it is difficult to make
either any sound comparison with the past or
a conservative estimate as to the future trend.
We can only take conditions as we find them
and live from day to day. The inflation in
prices, in every direction, is reflected in the
increased amount of capital necessary to transact business, but unprecedented profits in most
lines seem to have made this a matter of little
moment. General reports are optimistic, and
there are few discordant notes.
The selective draft and the necessary preparations to take care of the men called to the
colors have been a most disturbing element in

SEPTEMBEB 1,

1917.

FEDERAL RESERVE BULLETIN.

703

the labor situation, which has been generally DISTRICT NO. 6—ATLANTA.
Practically all factors underlying general
disorganized, and complaints in regard to it
are universal. The work on the cantonments business continue in large volume and high
at Columbia, S. C, and Petersburg, Va., the activity. Less favorable conditions, wherever
naval base at Norfolk, Va., and Government found, are the result of either shortage of labor
work contemplated at Richmond have called or materials, or the lack of proper transportafor an unprecedented volume of labor. Very tion facilities. The definite settlement of the
high wages are being paid, the result being to food control legislation has had a steadying
take laborers from manufacturers, industrial j effect and the bright outlook for all crops gives
plants of all kinds, and from the farms. Many the business public a more substantial feeling
complaints are heard of inability to harvest than is usual at this season of the .year.
the growing crops. The large amounts paid
Crops.—The prospects are favorable for
out through these laborers have been an arti- record-breaking crops of every character, cotficial stimulant to trade, from which there must ton excepted. A rainy season prevailed largely
necessarily be a decided reaction.
throughout the district during the first half of
Crops in this section are reported unusually the month, practically a little too much for
good. Wheat is above the average, corn is this season of the year, but only in a few insaid to be the best ever raised in the district, stances has damage been reported, other than
tobacco is up to or above normal, and while to increase the insect activity on cotton and
cotton is below the average in output the high other crops. In the southern half of the disprices will, so far as value is concerned, more trict, practically ail crops have been laid by.
than offset the decline in volume. Prices of all Crops have been well cultivated the entire
these crops are high, tobacco has already com- season, in fact more than in ordinary years.
menced to move, and the demand for currency Especially good reports come from central and
south Alabama, where last year heavy rains
in the interior is much larger than usual,
While financial demands for crop raising destroyed the crops.
have been unusually heavy, and the demand
It is naturally supposed that the boll-weevil
for rediscounts above the normal, many banks would make greater progress on account of the
still report a surplus of funds, and the general recent rain, it being impossible to get into the
demands of the district have been handled cotton to work it or to eradicate the weevil,
without any strain.
but the rainy season was not followed by hot
While a considerable amount of the late pay- weather productive of weevils; and, owing to
ments against Liberty bonds have been redis- the absence of this heat wave, there has been
tributed among depositaries in the district, all very little shedding. The weevil is reported
calls made by the Government have been as increasing in some sections and may probably
promptly met, and the subscriptions of the dis- get the top crop, but most of the old cotton is
trict to the last issue of Treasury certificates full of grown bolls and still improving. Grass
was not allotted in full, but scaled on account that sprung up during the rain did not largely
injure the crop, as most of the fruit that is
of the general oversubscription to them.
There seems to be a conservative realization counted on is now in the shape of grown bolls.
of the fact that we are living and doing business The plant is holding its fruit well, and is bein unusual times and under unusual conditions, ginning to open fast in the southern portion of
from which there must be a return to a more the district, where picking is under way.
conservative level, and this leads to the hope, Some of the first bales have been marketed.
if not to the expectation, that when this return In the sea-island cotton section, reports inditakes place we shall be able to accomplish it cate that the boll-weevil is doing more than
ordinary damage, but at least a normal crop
without serious dislocation of business.




704

FEDERAL RESERVE BULLETIN.

of this variety of cotton is looked for considering the fact that the acreage devoted to it
has been greatly increased this year.
The corn crop is abundant. Early corn is
ripening and late corn growing nicely. The
Tennessee tobacco fields bid fair to yield a full
average crop, the present conditions surrounding it being favorable."
Sugar.—Louisiana is raising a $50,000,000
crop of sugar this year, compared with a
$35,000,000 crop in 1916. A new branch of
the industry has developed in this State within
the past few months. A number of the larger
mills are importing Cuban raw sugars and refining them—work which has never been done
heretofore except by the American Sugar Refining Co.
Rice.—The consumption of rice has increased
20 per cent in the past six months, resulting in
higher prices for this commodity and prospects
of high prices for some time to come. Cleaned
rice is selling on the floor of the New Orleans
Board of Trade at 4.75 to 7.50 cents per
pound. At these prices rice growers have
prospects of a big profit. It is estimated that
the Louisiana crop this year will bring
$25,000,000, or $7,000,000 greater than last
year's crop.
Flour.—Mills are all running strong and
supplying the demand. The food control idea
of stabilizing prices will largely eliminate speculative features in the trade, and modest and
continuous buying on the part of the merchant
is looked for, as there would be no advantage
in carrying large stocks. Prices for bran and
shorts have been unusually high, but the
prices on mill feed are much cheaper than on
any other character of stock feed.
Lumber.—The demand continues greater
than the supply. Prices are higher than for
several years. Members of the Southern Pine
Association have unfilled orders for 50,000 cars
of lumber. With the Government's demands
for lumber and the unusual calls from other
lines, the only discouraging feature in this
market is the car shortage, which it is hoped
will be relieved by the proposed plan of the
National Council of Defense.




SEPTEMBER 1,1917;.

Naval stores.—The comparative scarcity of"
labor and high prices prevailing for supplies
entering into the cost of manufacture have put
upon the producer an unusual burden. There1
has been a slight advance, something like 5 per
cent, in the value of spirits of turpentine, and
also a small advance in the value of rosins
within the past 30 days. The rainy weather
during the month caused a slight decrease in
production. Stocks are low, and this fact,,
coupled with the high price which will probably have to be paid for cups next season,
indicates considerable reduction and higher
prices. From the producers' standpoint conditions in this industry are by no means satisfactory.
Shipbuilding.—This industry has taken on a
sudden and strong activity not equalled by any
in the South in the past 20 years. The Tennessee Coal & Iron Co., the Alabama subsidiary
of the United States Steel Corporation, have
purchased 3,500 acres of land and secured
options on 8,000 additional acres at Mobile^.
Ala., and have begun the erection of a shipbuilding plant at that port. Like industries
at Mobile are fully employed and making
additions. At Savannah there are under
contract and construction 27 ships of various
tonnage, representing approximately $11,500,000, with four plants in operation and several
thousand skilled workmen employed. Shipbuilding at this port prior to 1916 was negligible. At New Orleans new shipbuilding yards
I have been constructed giving employment to
several thousand men. The New Orleans
Board of Trade has launched a campaign to
rebuild the naval station. At Brunswick, Ga.,
from a thousand to fifteen hundred men are
engaged in this industry. Like activities are
reported at Jacksonville and other plants along
the Atlantic and Gulf coasts. The material
used in ship construction at these points is
largely being drawn from the South and the
labor and material conditions affecting the
| industry are reported good.
Wholesale and retail and manufacturing.—
The wholesale and retail houses report trade
good, collections easy, and business generally

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

705

Post-office receipts show a gain of 10 per
on a sound and satisfactory footing. The
production of coal, pig iron, steel products, cent during July, 1917, as compared with the
and the activity of the various manufacturing previous year, at 10 of the more important
plants, chiefly those that deal in the manufac- offices in the district.
ture of machinery of different kinds, are largely DISTRICT NO. 7—CHICAGO.
Business is showing some hesitation, as many
responsible for the good business conditions.
Business being pitched on an abnormal plane buyers wish to await the outcome of the legisis calling for frequent and sudden adjustments lative and regulative measures now under conin both wages and conditions surrounding sideration before acting. The question of exlabor. This is strongly evidenced by the cess-profit taxation and price fixation is conreorganization and demand of the union coal stantly before manufacturers and business
miners throughout the Birmingham district. men, and when a definite policy has been deIn this field the threatened walk-out has been termined there should be a renewal of acpostponed pending the proposed visit of the tivity, as basic conditions are generally sound
and the crop prospects are excellent. Banks
Secretary of Labor.
Real estate and building.—The real-estate are able to use their available funds in legitimarket shows a slight improvement, confined mate channels at firm rates and borrowing
largely however to particular parts of the customers are making their arrangements to
district. Other than the army cantonments care for their financial needs.
The bond market is quiet, with some call for
and in the vicinity of their location, building
remains normal to the local need, restricted short-term notes, and the attention of inveslargely to absolute demands owing to the tors is naturally concentrated upon the large
inability to get shipments of building materials Government issues which have been and are
and lack of finance, due partly to subscriptions to be placed. General investment securities
to Liberty Loan bonds and Red Cross funds. are being held back by uncertainty as to the
In view of the better crop prospects, contractors new tax program.
feel more optimistic, as it is not thought that
Crop conditions throughout the district are
building will be delayed on account of the reported as good, with Illinois wheat estipresent prices of building materials as no sub- mated as half a crop, oats as the largest yield
stantial decrease can be expected for a number in the history of the State, and prospects for
of years.
corn excellent. Indiana expects good corn
General.—There is comparatively little trad- and oats crops and a fair production of wheat.
ing in municipal or industrial bonds. Much Iowa is harvesting a good crop of small grain,
of the money which would probably have gone and corn should furnish one of the largest
into such funds was used in subscriptions to i yields in a number of years. Michigan and
Liberty Loan bonds. Bond men express the . Wisconsin will give a good account of thcmopinion that the publicity given to the Liberty | selves and a good potato crop is in prospect.
Loan will ultimately create an interest in other : There is reported a strong call for agriculbonds among a class who have not heretofore j tural implements owing to the labor shortage,
bought them.
; high prices of grain, and demand for increased
During the month the Hibernia Bank & I production. Men are being taken from the
Trust Co. of New Orleans, the largest State | farms and horses are being purchased for miliinstitution in the South, was admitted to ! tary uses. These facts have made the tractor
membership in the Federal Reserve System. I practically a necessity on many farms. The
Money rates hold fairly firm with little | great difficulty faced by manufacturing conreduction anticipated.
cerns is the shortage of labor and the uncer-




706

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

tainty connected with the price and delivery
Shipbuilding and the steel industries report
of the needed raw materials.
no change and are operating to capacity.
The situation as regards the automobile
Watches and jewelry have experienced an
manufacture has not changed during the past excellent year up to date and expect a continmonth and there appears to be a good demand uance of this condition through the fall.
for low-priced pleasure cars of good quality.
Woolens of good quality are very difficult to
Building and its allied lines are quiet except obtain even at the present high prices and the
in so far as Government construction is con- wool market is firm with moderate activity.
cerned.
The demand is largely based upon military
Coal mines are operating at about 60 per requirements, civilian orders having shown a
cent capacity, due to lack of miners and decrease.
scarcity of cars. The profits in this line are j Clearings in Chicago for the first 20 days of
large and some concerns report the likelihood | August were $1,277,000,000, being $199,000,000
of a coal shortage during the coming winter. | more than for the corresponding 20 days in
Liquor is being disposed of at substantial | August, 1916. Clearings reported by 21 cities
prices and distilleries are making efforts to con- in the district outside of Chicago amounted to
vert their equipment to other uses. Breweries $273,000,000 for the first 15 days of August,
are transacting a satisfactory business and 1917 1917, as compared with $219,000,000 for the
should be a good year in this line.
first 15 days of August, 1916. Deposits in the
Merchandise stocks with retail dry goods 12 Central Reserve City member banks in Chimerchants are heavy, which is affecting whole- cago were $823,000,000 at the close of business
sale distribution. Outstanding accounts are August 20, 1917, and loans were $568,000,000.
reported large, with collections fairly good.
Deposits show an increase of approximately
Furniture manufacturers report a good de- $11,000,000 over last month and loans remained
mand.
approximately the same.
Grocers enjoy a good volume measured in
dollars and cents, but retailers with limited DISTRICT NO. 8—ST. LOUIS.
Business conditions in this district show little
capital are having a hard time on account of
change during the past 30 days. The general
the increased values.
In the hardware line, there is a slight falling activity has been well sustained during the dull
off in buying, but the volume of sales on the summer months, while all reports indicate a
very favorable outlook for fall trade.
whole is good.
Although building construction has been
Leather is in demand for Government contracts and labor continues scarce. Collections restricted for the past few months, there is at
present an active demand for lumber due to
are fairly good.
The packing industries are finding a good the heavy requirements of the Government in
domestic demand and a slight decrease in for- building cantonments for training the National
eign requirements. The prices are holding Army. Supplies of lumber on hand are light
strong and the high quotations both for meat and lack of transportation has hampered
and grain are bringing to market many cattle further activity. Sales of hardwood are reported to be exceptionally heavy.
and hogs.
The dry goods business this summer has
Lumber concerns are affected by the debeen up to normal, although stocks in the hands
creased building operations.
Mail-order concerns report an increase in of retailers in the small centers have been and
sales over the entire district and piano manu- still are higher than the average. Orders for
facturers are finding an improvement in orders. fall delivery have generally been very satis-




SBPTEMBEE 1,1917.

FEDERAL RESERVE BULLETIN.

factory and largely in excess of former years.
Manufacturers of women's ready-to-wear garments report that their business has been
somewhat curtailed by the rapid increase of
prices. Shoe manufacturers throughout the
district, and especially in St. Louis, have
shown increases in sales from month to month.
Government contracts for Army shoes are a
factor in the market.
Manufacturers and jobbers of hardware,
woodenware, and paper all report an active
business, with the output in some cases hampered by the scarcity of raw material and delays
due to car shortage.
Last month I reported that the outlook for
the crops was favorable and reports received
from private sources, during the past few days
indicate that substantial progress has been
made. General rains throughout the central
portions of the district early in August materially helped the situation. The combined
condition of all crops for the States, wholly
or in part, within this district as given by the
Government Crop Report of August 1 are in
each case well above the average and show
gains in condition ranging from 8 to 14 per
cent as compared with the condition on July 1.
The wheat crop in this district has been
harvested. The yield is above former expectations and correspondents report an average weight of probably over 60 pounds to the
bushel. Preliminary estimates issued by the
Department of Agriculture on August 8
indicate a harvest for the States wholly or in
part within this district largely in excess of the
1916 harvest, but below the five-year average.
The oats crop has also been harvested and preliminary estimates indicate an exceptional
yield well above that of 1916 and the five-year
average.
Reports on the corn crop continue to be
satisfactory. A month ago I stated that
general rains would seem to assure a bumper
crop and from present indications this forecast will be fulfilled. The estimates from the
August 1 condition show an increase as compared to the estimates from the July 1 condi-




707

tion and the harvest should materially exceed
both the five-year average and the 1916 yield.
Recent rains put the ground in excellent
condition for cultivation, and plowing for
winter wheat is now well under way. There
is already an agitation for an increase in the
winter-wheat acreage.
The Government report on the cotton crop
as of July 25 shows an improvement in condition for all the States in this district as compared to the condition on June 25, and the
improvement shown is borne out by reports
from private sources. The weather during the
last 10 days has been favorable, and it is not
now expected that the season will be as late as
was expected a month or two ago. In general
there is little report of insect damage, and even
in Mississippi the boll-weevil damage, to this
date has not been as serious as was feared.
The condition of the crop in Arkansas is reported to be excellent and the lateness of the
season, particularl}^ in the eastern part of the
State, is being rapidly overcome. The first
bale of Arkansas cotton was sold at Pine Bluff
on August 15.
The outlook for the tobacco crop in Kentucky
seems to be excellent. Our correspondents report a large acreage, with every prospect for a
bumper crop.
Pastures have revived under the influence
of recent rains and cattle and young stock are
reported to be in splendid condition. The
apple prospects continue fairly good. The
peach crop has developed better than was expected and the fruit now coming to market
seems to be above the average both in size and
quality, and hence is bringing attractive prices.
The minor crops and truck gardens are reported to be in reasonably good condition for
this time of the year.
The St. Louis National Stock Yards at National Stock Yards, 111., reports an increase in
receipts of cattle and hogs for the month of
July as compared to July, 1916, and a decrease in the receipts of sheep and horses and
mules for the same period. The tendency of
the hog market continues to be upward, new

708

FEDERAL RESERVE BULLETIN.

high levels being noted from time to time, with
the top price of $17 per hundred for hogs on
August 10.
The car shortage shows some improvement,
the net shortage on July 1, 1917, being over
77,000, as compared to surpluses ranging from
52,000 to 275,000 on this date in former years.
Freight movement is slow and is a serious
handicap in many industries.
Index figures on the cost of living have remained approximately stationary for the past
few weeks, somewhat below the high mark registered at the end of May.
The figures of the gross earnings of the railroads operating within this district for the first
six months of this year are now available and
in each case show an increase. It is not expected, however, that the figures for the netearnings will show the same proportion of increase, as the cost of all railroad supplies and
of labor has mounted steadily from month to
month.
Building permits in Louisville, Memphis, and
St. Louis for July, 1917, show a decrease as
compared to July, 1916, while Little Rock
shows a slight increase. Generally speaking,
all building is restricted, due in part to the
prohibitive cost of building materials and in
part to scarcity of labor.
Postal receipts for July, 1917, show an increase as compared to July a year ago for the
large cities within this district.
The labor situation can not be said to be
entirely satisfactory. Strikes and other labor
troubles have been reported in a number of
industries.
The bond business is still quiet.
The commercial paper rate is approximately
5 per cent, some of the best names selling a
trifle under that rate, but the majority of the
offerings being at 5 per cent. City banks are
not active in the market, but there seems to be
a good demand from country banks. Bank
rates to customers range from 5 to 5 J per cent,
5 per cent being the ruling rate.




SEPTEMBER 1.1917.

DISTRICT NO. 9—MINNEAPOLIS..

Large crops are being harvested in Wisconsin
and Minnesota, and very good crops are being
threshed in the eastern portions of North
Dakota and South Dakota. Grain yields in
western North Dakota and eastern Montana
are light.
Corn prospects in Wisconsin and Minnesota
are excellent and are good in eastern South
Dakota and parts of eastern North Dakota.
This crop over most of the district has been
quite backward, but during the past two weeks
has been enjoying very favorable weather.
In the eastern half of this reserve district
the money returns to farmers will be large.
Crops are uniformly good and prices are excellent. In the western half of the district
the yields are light and in some localities
damage from drought has been very severe.
In the latter area a considerable amount of
stock has been moving out to market at very
high prices, which has been of considerable
assistance in offsetting the losses on the grain
crops.
Industrial concerns throughout the district
are doing a large business and have orders
ahead sufficient to guarantee the employment
of large forces through the remainder of the
year. Country trade is generally good and
wholesale business is in satisfactory volume.
The coal situation has caused some apprehension, but recent steps promise to expedite
shipments via the Great Lakes, which, if they
reach sufficient volume, ^ 1 eliminate the
danger of a shortage this winter. Coal stocks
are light for this season of the year, and because
of high prices the urgent appeal to buy early
has not been as effective as was expected.
The prices of both hard and soft coal have
reached record levels and are considerably
advanced over corresponding figures of a year
ago.
Bankers and business men are optimistic
regarding the outlook and feel that in spite of
considerable losses, as compared with the

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

709

keting of many immature animals from the
Southwest. The feature of the trade was the
promptness with which packers absorbed
arrivals. Hog prices were the highest ever
paid in the month of July and a good many
dry weather hogs were marketed, but met with
poor demand, a wide spread in prices existing
between common and good grades.
Similar discriminations were made in sheep
offerings, the market growing weaker as the
month progressed. Since the breaking up of
the drouth and the improvement in prospeqts
for feed production, conditions have improved
materially for the farmers and stockmen
engaged in finishing live stock for the market.
Mining.—Shipments of ore from the
Missouri-Kansas-Oklahoma field showed a decline in July over the previous month due to
lower prices for ore and an actual decrease in
output occasioned by the gradual shutting
down of sheet ground mines which were unable
DISTRICT NO. 10—KANSAS CITY.
to produce at a profit. Surplus stocks show a
Agriculture.—July furnished its full average better position than last year in spite of lower
of anxiety and cause therefor, the serious ore prices and the exceedingly high prices for
drouth continuing generally until the end of supplies. Operators are concerned as to their
the first week in August, resulting in a reduction ability to meet the present wage scale from
in corn estimates on August 1 from those of which there are no indications of immediate
July 1 of approximately 25 per cent. Heavy relief on account of high cost of living. Small
rains in nearly all parts have, however, had a mining camps in Colorado have been unusually
most beneficial effect, and it is believed that active and an increased production was reported
the estimates of September 1 will lend, much from practically all of them with the exception
encouragement. In addition to the improved of those hampered by labor troubles.
corn situation, more and more consideration is
Oil.—The long predicted advance in the
given to the betterment of sorghum grain crops, market quotation for Mid-Continent crude oil
large yields of oats, and the reviving alfalfa has been realized, the first since January 12.
fields. Irrigated crops are doing unusually The price now quoted is $2 per barrel, a 30
well. Interest now centers in the effort to cent increase and the highest price ever posted
secure the planting of a large acreage of wheat in the history of this field. With the total
this fall and much attention is being given to I production of Oklahoma and Kansas less than
securing the required seed. The ground is in ! 300,000 barrels per day and the trunk pipefine -condition for fall plowing which is being j line companies and the refiners in Oklahoma
vigorously pushed.
j demanding approximately 400,000 barrels of
Live stock.—As predicted in last month's j oil a day, the producer expects even further
review, July recorded very heavy receipts of advances and justifies them by general condicattle at every market in the district, the local tions 'and cost of production. Many operators,
markets receiving the largest number on record who have closed down on account of the high
in the seventh month, the primary cause being price of pipe and cable will now find it possible,
high prices, but dry weather forcing the mar- j however, to finance operations and resume

crops that were in prospect in the earl}/ part
of June, the large money returns which farmers
are receiving will be sufficient to maintain a
satisfactory degree of prosperity, while industrial concerns and general business will probably go forward into the winter with nothing
more than the seasonal fluctuations in volume.
The demand upon city banks is heavy, due
to crop moving. Interest rates are very firm.
Larger banks report that their country correspondents will clean up this fall, with very few
exceptions, in spite of adverse agricultural
conditions in some localities.
Considerable speculation exists as to effect
of price-control measures upon the handling
of this fall's grain crop and upon conditions
at the terminal markets, but the Government's
measures have not yet become sufficiently
clear to indicate in what respect the situation
will be different from that of former years.




710

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

drilling. During the first six months of the Larger and better orders are appearing, while
present year Kansas produced more oil than conservatism is still manifest. Groceries and
it did during the entire year of 1916, but Okla- kindred lines are active. Manufacturing is in
homa showed a decrease due to the decline good volume, and most plants are working to
in the older pools. The total production of capacity. On every hand anticipation is high
the two States for the period mentioned was for a substantial increase in the fall trade.
in excess of 62,000,000 barrels as against
Reports for July as compared with July last
59,000,000 barrels for the first half of 1916. year, indicate average increases in both
News from the Wyoming and Mid-Continent purchase and payment activities in this disfields is of a highly favorable character, the trict of approximately 2 per cent, while inonly drawback continuing to be the price and debtedness remains practically stationary.
limited supply of equipment.
A general revival has taken place in the
Lumber and construction.—The lumber busi- flour trade and while the heavy rush of business has been unusually quiet even for this sea- ness incident to first crop movements of
son of the year, Government and railroad former years is lacking, there is a healthy
orders holding prominence. The most inter- general demand from all markets, although
esting feature of the market is the fact that inquiries and sales are for smaller lots than
prices are holding up in spite of decreasing formerly. Very little is being done in the way
demands. Sash and door factories are taking of advance bookings for future shipment.
care of set summer trade, but there is little I Most of the flour mills are selling the equivalent
activity. Business this fall, however, is ex- of capacity while some are accumulating bookpected to exceed that of other years by a con- ings. Indications point to a somewhat acute
siderable margin, volume depending upon crop | need of new supplies in all territories. No
production. Reports on valuation of building export business has been reported of late,
permits issued make a peculiar showing. Five but liberal Army orders have been received.
out of the district's eleven most important There continues to be great confidence in the
cities show a loss while six disclose a gain, the rushing business which is to follow the establosses running from 6 to 87 per cent, and the lishment of Government regulations on wheat
gains from 11 per cent to the fine showing in and flour.
St. Joseph, Mo., of 980 per cent.
Dealers in implements report that seasonal
Labor.—Labor disturbances are reported lines are moving in excess of previous years,
from many quarters and in various lines of with collections good. Optimism as to the fall
industry and evidences of unrest would appear trade is general. In spite of the damage done
to be on the increase in spite of the fact that by dry weather, resulting in some cancellawages are generally higher and the labor sup- tions, conditions may now be said to be exply inadequate to meet demands. The only ceptionally healthy. The tractor business is
encouraging feature is the fact that strikes tremendous. One tractor dealer estimates
thus far called have been of short duration as I that there were a hundred dealers in the local
a rule, evidencing a willingness to compromise market the first week in August, all interested
without seriously crippling the enterprise so in tractors, and declares that the supply was
essential to the country in this critical period only about one-tenth of the demand.
of its existence.
Financial.—There is every evidence of a
Mercantile.—Considering the season and substantial increase in the demand for loanable
serious conditions which have surrounded crop funds as indicated by the amount of discounts
developments, wholesale and retail business in I handled by this bank for its members. The
general has been in satisfactory volume. | high point during 1916 in this class of invest-




SEPTEMBER 1, 1917.

FEDERAL RESERVE BULLETIN.

ments was $3,500,000, readied early in the
year. The recent increasing amounts are best
shown by the following approximate figures:
June 15, $6,000,000; July 15, $8,500,000;
August 15, $13,000,000.
However, while reports of slight increases in
discount rates have been reported, these have
generally affected the smaller borrowers, rates
on commercial paper remaining practically
stationary. The consensus of opinion is that
the forthcoming call of the Comptroller of the
Currency will disclose some reduction in bank
deposits as compared with the last preceding
call, although the general marketing of wheat
may more than offset present indications.
Fifteen reporting cities of this district show an
average increase of 41.9 per cent in bank
clearings for July over the same month last
year, the placing of heavy Government orders,
high commodity prices and important special
financial operations tending to swell clearings
at practically every point, and to highest
marks at some centers.
DISTRICT NO. 11—DALLAS.

There has been a marked and substantial
deterioration in crops generally, especially
cotton, within the last 30 days. Conditions
in many sections were somewhat relieved by
rains in July, but generally over the State the
weather has been very hot and rainfall practically nothing until the last few days in central,
west, and southwestern Texas. Cotton is
doing fairly well in north central Texas, splendidly in the north and northeastern part of the
State, and is up to the average over most of
east Texas. The crop in western and southwestern Texas is almost a complete failure, and
conditions are very serious in Milam, Williamson and some adjoining counties.
There is considerable movement of cotton in
south Texas, and within 30 days receipts
should be heavy. The grade of the staple is
inferior there, however, and on account of the
decreased yield the season will be short. One
of our correspondents in central Texas reports
that it will take from 20 to 40 acres to produce




711

1 bale. Similar advices are received from
parts of west Texas, where the crop is almost
a complete failure; in fact, one of our correspondents reports in his county alone, wherA
the normal production is 20,000 bales, that
even with favorable conditions from now on,
only about 1,000 bales will be produced. In
north and northeast Texas and southern Oklahoma the crop is fine, and progress all that
could be expected. Particularly is this true
in the black-land belt of north Texas. It is
believed that the crop in the State may equal,
but will not likely exceed, three and a quarter
million bales. Rains within the last two or
three days will undoubtedly improve the situation to some extent. The crop as a whole,
based on present prices, will yield a sum considerably larger than the returns received last
year, but the almost entire failure in large
areas of the State will produce a serious condition in those sections.
The rice crop in the Orange section was not
affected by the extreme dry weather there, and
the average acreage has been planted. A
normal seasonal yield of around 100,000 bags
is anticipated.
Receipts of cattle from the drought-stricken
sections of the district have been unusually
heavy. As a consequence the class of such as
offered was inferior, being hurried to market
rather than be fed at the almost prohibitive
prices of feed. Hogs have also been in good
demand and prices continue high. During
August the hog market has established new
records, and prices paid, wore the highest in
the history of the Fort Worth market.
Exports from Galveston for June (figures
for July not obtainable) continue heavy, and
for the month the value of such exports was
$16,523,473. The value of such shipments in
June, 1916, was $10,761,590, an increase of
$5,766,883. The increase consisted principally of shipments of wheat and cotton to
England, Sweden, and Cuba. A decrease in
the exportation of timber is noted, and the
volume is not as heavy as last year. This is
attributable to the strong domestic demand for

712

FEDERAL RESERVE BULLETIN.

timber brought about by the building of Army
cantonments and wooden ships. The scarcity
of bottoms has curtailed the exportation of
crude oil for the purpose of refining abroad,
and this has naturally eventuated in the exportation of more high-grade refined oil and
greases than ever before.
Industries affected by Government requirements are unusually active and running on
full time. Lines ordinarily dull at this season
show activity by reason of the inauguration
of the annual series of trade excursions, which
brings a large number of buyers to the larger
markets of the district. Dry goods, shoes,
millinery, and similar goods are in good demand. Retail trade has been stimulated by
midsummer clearance sales.
Building operations are quiet. This dullness, however, is more than offset by the cantonment construction and other Government
orders.
The offering of another issue of Treasury
certificates of indebtedness, with November 15
maturity, was well received in the district, as
demonstrated in the large oversubscription
when the books closed August 9. Deposits,
reflecting the seasonal decline, are nevertheless
at a good figure. There is no diminution in
the demand, and offerings with this bank have
been very heavy in August. Rates are firm,
with little change. Currency orders indicate
the fall crop movement, and are beginning to
reach large proportions. Clearings, as reported
by the principal cities—Austin, Dallas, El Paso,
Fort Worth, Galveston, Houston, San Antonio,
and Shreveport—show an increase of 26 per
cent for July over the same month in 1916.
The figures were: July, 1916, $153,046,731;
July, 1917, $205,867,982; increase, $52,821,251.
Post office receipts at the principal cities of
the district for July show a slight decrease—
less than 1 per cent—over July, 1916. The
figures were as follows: July, 1916, $324,164;
July, 1917, $323,659; decrease, $505.
The heavy drain on industrial and commercial forces by the selective draft has created
uncertainty and unrest in the labor situation.




SEPTEMBER 1,1917.

Demand for men is greater than the supply,
and there is a real scarcity of efficient workmen. The large number of men examined and
claiming exemption, with the probability of
other calls in the immediate future, have disrupted organizations, and resulted in makeshift forces. The wages paid men for cantonment construction, particularly carpenters and
day laborers, are high and have attracted
a large number of men from other fields. The
tense situation brought about by the labor disturbances in the copper mining section of
Arizona has been relieved, and conditions there
are about normal.
Business with Mexico is increasing slowly
with the restoration of normal conditions in
that county. A regular schedule on the
Mexican National Railway is being established
between Matamoras and Monterey, and trade
conditions are expected to improve as the
result.
Briefly to summarize the business situation
in the district and the prospects for the immediate future, it can be said that the outlook
is decidedly favorable.
DISTRICT NO. 12—SAN FRANCISCO.

With a generally abundant production of
foodstuffs in the twelfth Federal Reserve district, two unfavorable elements are conspicuous: First, heat and drought in the Northwest
have considerably curtailed the yield of grain
there, wheat and oats crops being reduced in
spite of increased acreage, to not over 75 per
cent of last year's production; and, second, the
orange and lemon crops in California suffered
so greatly from the extraordinary heat about
the middle of June that the Government report
of August 1 gives the condition of oranges as
45 and lemons 55, compared with a 10-year
average of 87 for each. The effects upon tho
citrus fruit of this unusual heat are not all
harmful, however, as it has destroj^ed or reduced some of the citrus pests, such as black
scale, etc. Experienced growers express the
opinion that, including the next two or three
years, the crop results may average nearly as

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

great as if the heat had not damaged this year's
crop.
California's yield of both oats and wheat,
though only 6,000,000 or 7,000,000 bushels
each, has been in excess of that of last year.
Barley is an important California crop and
shows a large increase, the earlier estimate of
a crop of 1,000,000 tons having been more than
confirmed. This compares with about 550,000
tons last year. The output of beans, of which
it is said that California produces one-third of
all grown in the United States, will reach
6,480,000 bushels, a 50 per cent increase over
last year.
The corn production in this district is relatively unimportant. Oregon, Washington, and
Idaho show a prospect of more than 7,000,000
bushels, which is 100 per cent increase over last
year.
Rice acreage in California is rapidly increasing and this year's product is expected to be
greater than ever before. The yield of potatoes has been generally large.
Reports from Utah and Nevada have indicated unusual production of all crops.
It is estimated that the yield of grapes will
exceed that of last year by 10 to 20 per cent,
and that the product of deciduous fruit will
reach a record total in California, although in
the Northwest there will probably bo no increase over last year.
The total of food products of this district
will very substantially exceed that of last year,
with possibilities of further increase next year.
Lack of clear understanding on the part of
farmers of the national and international importance of large production of foodstuffs hinders increase. This is illustrated by an instance in the Northwest where a number of
farmers were found cutting unmatured wheat
for forage, upon the ground that they must
feed their live stock. In response to the showing that they could better afford to pay even
$50 a ton for hay, the reply was that they had
enough additional wheat to provide all the
money they needed.




713

One possibility of a new supply of meat has
been brought to the attention of residents of
the Pacific coast in placing whale meat upon
the menus of leading clubs and hotels. Its
flavor is not unlike that of beefsteak.
The I. W. W. menace is important in certain
sections. Instead of every one, proprietor,
clerk, and laborer alike, feeling it a patriotic
duty to work a little harder and a little longer
in order that we may spare men for waging
the war to bring peace and safety to the world,
efforts are made to diminish both hours and
output of work. The result is, of course, to
hamper the effectiveness of this country's efforts, which in effect is the same as aiding to
increase the enemy's effectiveness.
Lumber production in the Northwest is now
much below normal because of labor conditions.
It is reported from Seattle that by the end
of September that city will be the greatest
builder of wooden ships of all ports of the
world. There will then be over fifty ways for
the construction of ocean-going wooden vessels,
as against five a year ago.
On August 7 Mr. James K. Lynch was
elected governor of the Federal Reserve Bank
of San Francisco, assuming the duties on
August 13. His banking experience admirably equips him for this important post. In
conformity with the ruling of the Federal
Reserve Board, that a governor should not be
a director, Mr. Lynch has tendered his resignation as director. His successor will be elected
by the votes of Group 2 member banks of this
district, banks being divided into three groups
according to size for the purpose of voting.
As governor, Mr. Lynch becomes ex officio
chairman of the General Liberty Loan Committee, the work of which will necessarily absorb much of his attention for the time being
both in perfecting the organization for the second Liberty Loan and in the campaign itself.
The date for the second Liberty Loan will
j shortly be fixed. Meanwhile temporary eertifii cates of indebtedness are being sold by the

714

FEDERAL RESERVE BULLETIN.

Secretary of the Treasury to provide funds for
immediate needs. It is in every way desirable
for these to be bought by both banks and individuals and used later on in payment for
Liberty Loan issues. It is equally desirable
for banks having subscribed on their own account for the first issue of Liberty bonds to
dispose of them to investors so as to leave their




SEPTEMBER 1,1917.

resources free for handling the next issue. It
is only in this way that the greatest effectiveness may be achieved in the use of our financial
resources to aid in the prosecution of the war.
This district made a splendid achievement in
subscribing for more than $175,000,000 of the
first Liberty Loan.

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

715

DISCOUNT OPERATIONS OF THE FEDERAL RESERVE BANKS.
During July, 1917, discount operations of the
Federal Reserve Banks totaled $460,733,353,
or more than double the total discounts of
the banks for the entire calendar year 1916.
Of the monthly discounts over 85 per cent,
or 8395,452,415, were in the form of member
banks7 collateral notes. Almost 64 per cent
of these notes were handled by the New
York bank, which reports the discount during
the month of 111 such notes, aggregating
$252,654,805. All the banks, except Atlanta,
Minneapolis, Dallas, and San Francisco, report
a larger volume of collateral notes than customers' paper discounted for their members;
Boston, Richmond, Chicago, Philadelphia,
Kansas City, and St. Louis each reporting
monthly amounts in excess of 10 millions.
Over one-half of these notes, viz, $202,786,193,
were secured by commercial paper, and nearly
one-half, or $192,666,222, by interim receipts
for Liberty Loan bonds or United States certificates of indebtedness. The average size of
all collateral notes discounted by the New
York Reserve Bank was about $2,276,000, as
against about $268,000 for all the other banks.
These averages are much smaller than for
June, when some of the largest city members
were accommodated in connection with Liberty
Loan operations.
Total discounts for the month include, beside
the $395,452,415 of collateral notes, $1,077,607
of trade acceptances handled, largely by the
Boston, Richmond, and St. Louis banks;
$449,894 of commodity paper discounted
chiefly by the Richmond and Dallas banks, and
$63,753,437 of other customers' paper.
Discounts for the first seven months of the
present year aggregate $1,419,914,522, of
which $1,161,840,406, or nearly 82 per cent,
were collateral notes, while $8,202,341 of the
total are specified as trade acceptances and
$6,198,686 as commodity paper. As compared
with corresponding 1916 figures trade acceptances increased more than fourfold., while
commodity paper declined over 37 per cent.




Over 87 per cent of all discounts, including
collateral notes, discounted during July, was
15-day paper (i. e., maturing within 15 days
from the date of discount with the Federal
Reserve Banks), less than 3 per cent 30-day
paper, over 4 per cent 60-day paper, and about
5 per cent 90-day paper. Agricultural and livestock paper maturing after 90 days but within
6 months from date of rediscount with the
Federal Reserve Banks (so-called 6-month
paper) aggregated $3,310,352, or over 0.7 per
cent of the month's total discounts. During the 7 months of the present year the
Federal Reserve Banks discounted about
$11,516,000 of this class of paper, compared
with $12,634,000 for the corresponding period
in 1916 and $10,921,000 in 1915.
On the last Friday in July the Reserve Banks
held $138,460,450 of discounted bills, as against
$197,242,135 about the end of June and
$27,594,000 on the corresponding date in 1916.
About one-half of the paper on hand were bills
maturing within 15 days. The total comprised
$39,158,731 of collateral notes secured by
commercial and bank paper; $13,213,197 of
collateral notes secured hj Liberty Loan bonds
or United States certificates of indebtedness;
$8,167,672 of agricultural paper; $7,181,614 of
live-stock paper; $63,768,475 of commercial
and industrial paper; and the remainder unclassified bills, chiefly discounts secured by
Liberty bonds and nonmember bank paper
with member banks' indorsement. Over threefourths of the agricultural paper was held
by the Richmond, Dallas, Chicago, and Minneapolis banks, and about 87 per cent of the
live-stock paper by the Minneapolis, Kansas
City, and Dallas banks.
During the month the number of member
banks increased from 7,657 to 7,681, while
the number of discounting members increased
from 900 in June to 960 during the month
under review. The largest number of accommodated members is shown for the Richmond
district.

716

FEDERAL RESERVE BULLETIN".

SKPTUMBBB 1, 1917.

buted bi/ sizes.
Bills discounted by each Federal Reserve Bank during July, 1917, distril
Over 5100 to S250.

To 5100.

Banks.

NumNumNumber of Amount. ber of Amount. ber of
pieces.
pieces.
pieces.

Boston
New York...

Philadelphia

Cleveland
"Richmond
A-tlanta . . .
Chicago
St. Louis. .
"MinneaDolis
Kansas "Citv. .
Dallas... "
San Francisco.

.

.

.

Total

Hanks.

Boston.
Now York

989

596,087
94,229
66,240
30,553
548.721
185,055
92.329
58,251
247,872
139.555
226.583
32,679

125
211
130
64
616
210
274
87
485
125
253
113

5228,361
366,357
241.960
117,767
1,062.508
'367,839
537,776
168.178
730.241
204.729
421.486
188,565

287,919

2,395

930,214

2,214

1,818,154

2.693

4,635.767

77

1,593

200
179

1.165
1.425
1,890

0.1

0.4

1.4

Over 82,500 to
$5,000.

Over 85,000 to
§10,000.

Over 510,000.

NumNumNumber of Amount. ber of Amount. ber of
pieces.
pieces.
pieces.
..

Philadelphia.

....

344 81,636.979
378 1.701.156
227 1.013.202
400.606
91

512
179

2.138.722
738.287
461 2.155.293
263 1.206,142
254 1,058.213
113
489; 320
149
564,104
576,938
147

.

Total
Per c e n t . . .
Member banks' collateral notes

NumNumber of Amount. ber of Amount.
pieces.
pieces.
Ill
111
82
42
670
121
117
81
323
192
321
43

40,337

6-J4

376

6,725
7,992

152 SI,514,537
151 1,261,536
78
721,881
66
638,289

217
69
216
97

136
27
59
125

1,851,954
521i521
1.948.135
947,150
1,003,625
219,811
444,389
860,734

3,118 13,709,022

1,393 11,933,562

21.0
200.000

18.3
380,550

44

Over 51,000 to
52,500.

530.861
52j907
49,358
20,701
264,952
90,592
28.735
34,458
78!833
101,317
171.392
6,108

89.349
15.372
14,395
8,041
73.379
37,382
7,052
5,035
17,830
28.104
70,991

§1,375
3,815
15,118

Amount.

Over $500 to
51,000.

73
133
120
55
640
238
75
91
213
270
470
17

52
80
82
48
378
208
36
28
100
166
409
6

14
50
334
5
73
111
2
2
17
15
20
1

Per cent
Member banks' collateral notes

Cleveland
Richmond
Atlanta..
.
Chicago..
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

Over 5250 to 1500.

40

7.1

2.8

r

rotal.
Per
cent.

Amount.

Number of
pieces.

Amount.

987
1,236
1.098
430
3,184
1.163
1,354
720
1,606
939
1.730
561

S7,624,499
9,711 300
3,968,888
3,581.873
7,599,816
2,973.443
11.465,310
4,211.406
5,002,108
1,780,115
2,870,405
4,491,777

11.6
14.9

49
109

54,106,950
6,215,928
1.818,734
2,365; 540
1,652.855
1,024.775
6.695,790
1,792,013
1,864,327
' 595,854
969:510
2,825,687

958

31,925,963

15,008

65,280.938

100.0

560

48.9
394,871,865

6-14

100.0
395.452,415

116
122
45
59

78
27
173
71

78
31

6.1
5.5

11.6
4.6
17.5
6.5

7.7
2.7
4.4
6.9

Bills discounted during the month of July, 1917 and 1916, and the seven months ending July, 1917 and 1916, distributed by
classes.
I

Secured by
Liberty
Bonds or
United
States certificates of
indebted-

Otherwise
secured.

81,655,000
175,869,630
~ "'"
1,691,650
2,010,000
1,379,525
612,000
3,881,117
350.000
2,090)000
2,622,300
125,000
350,000

533,150,985
76,785,175
16,515,320
5,281,000
25,534,637
632,500
18,265,000
10,820,000
1,714,151
11,734,585
1,187,500
1,165,340

8322,992
13,000
36,874
66,956
281,741
61,345
90,135
136,788
12,238
40,990
102
11,446

j 192,666,222

202,786,193

1,077,607

Federal Reserve Bank.

Boston
New York
Philadelphia..
Cleveland..
Richmond
RichmoE
Atlanta.
'"
'
Chicago
St. Louis
Minneapolis..
Kansas City..
Dallas
San Francisco
Total, July, 1917
Total, July, 1916.
Total, January-July, 1917.
Total, January-July, 1916.




Member banks 7 collateral
notes.

!

1,161,840,406

T rade ac- Commod- All other
ceptances. ity paper. discounts.

199,000
8,202,341
2,002,200

Total.

37,301,507
9,698,300
3,907,014
3,514,917
7,155,786
159,289
2,839,593
72,505
11,375,175
19,000 I 4.055,618
21,400 I 4)968,468
1,739,125
2,717,603
152,700
4,480,331

842,430,484
262,366,105
22,175,858
10,872,873
34,513,978
4,247,943
33,611,427
15,381,406
8,806,257
16,137,000
4,182,905
6,007,117

449,894 | 63,753,437

460,733,353

525,000

1,525,200 j 18,458,800
20,183,000
6,198,686 1243,673,089 1,419,914,522
9,884,600 ! 70,840,100
82,726,900

717

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917.

Amounts of discounted paper, including member banks' collateral notes, held by each Federal Reserve Bank on the last Friday
in July, 1917, distributed by classes.
: Member banks' collat- ;
!
era! notes.
*
: Agricultu| ml paper.

Banks.

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

.'

Total
Percent

trial paper.

Liberty "
bonds or I Otherwise
U. S.certiQ-! secured.
cates of indebtedness.

Allother |
discounts, j

Total.

§150.854
131,753
!
23,737
!
2.381,131
!
672,736
1,389,367
148,447
1,043,043
j
250,560
1,523,982
452.002

88,382,675
6,329.252
3.853,024
10.133 i 4,091,834
8.109,806
204,379
3.736,929
363,092
8;109,841
17,240
4,874,102
87,006
5,987,856
300,965
1,474,052
098,581
1,214,459
796,038
7,604,645
302,280

$990,000
5,575,930
425,650
1.160.000
'530.000
294,000
1,101,117
481,000
770,000
1,523,000
62,500
300.000

83,740,000
2,155,000
5,115;500
1,631,000
2.804,000
531;500
9,560.499
5,905,000
532,800
6,183.432
350^00
650.000

8617,999 i S13,730,674
4,894,194 j 19,107.130
9,525,927
7,968.426
,05,722
14,381.010
351,694
6,315
5.(50:1,572
20.178'. 064
11.,515,068
10,634:664
11.529.625
4,946^979
9.338.311
29,324 I

8.167,672
5.9

7?181,614 ! 63,768,475
5.2 I
46.0

13,213,197
9.5

39,158,731
28.3

6,970,761
5.1

SI,900

138,460.450
100.0

Distribution, by sizes, of bills bought in open market by all Federal Reserve Banks during July, 1917, and the sever, months
ending July, 1917 and 1916.
To $5,000.

T o §25,000.

To $10,000.

To 350,000.

Acceptances bought in open market.

Bankers'acceptances
Trade acceptances
Total, July, 1917
Per cent.
Juno, 1917
May, 1917
April. 1917
March, 1917
February, 1917
January, 1917
Total, 7 months ending July, 1917
Total, 7 months ending July, 1916

|

Pieces.

Amount.

Pieces.

1,659
21

34,338,353
54,139

835
16

! 1,680 j 4,392,492
i 2,297
1,305
!
748
389
819
i
390

j
;
i
!
i
i

6,053,419
3,571,384
1,589,086
876,506
2,175,639
1,023,210

7,305,289;

6,097,592 |

851

2,345

Pieces.

Pieces.

Amount.

11,774,481
7,024,753
2,147,380
1,381,029
6,324,018
1,706,069

Amount.

249
7

85,977,522 j 1,321 325,951,857
120,070 |
543,965
-34

1,497
890
270
175
777

7,628 ! 19,081,736 I 4,943
j 2,441;

Amount.

810,405,500
257,307

1,355 j 26,495,822 I
2,641
1,580
647
363
1,248
300

46,144,288 j
27,835,025 I
13,231,092 i
6,976,406 I
22,367,962 I
5,238,206 !

793
442
257
171
401
152

j 34,140,652
i 18,681,746
11,003,120
! 7,185,125
! 16,483,974
i 6,898,412

:

36,455,322 j 8,134 ;i48,288,801 j 2,472 ! 105,115,836
19,337,406 j 3,056 _ 52,190,774

To S100,000.

Over $100,000.

^

I 31,258^735
I

Total.

Acceptances bought in open market.

Per cent.
Amount.

Pieces.

Amount.

Bankers' acceptances..
Trade acceptances

134 511,000,328
18
1,643,081

30

85,895,593
616,350

Total, July, 1917.
Percent
June, 1917
May, 1917
April, 1917
March, 1917
February, 1917
January, 1917

152

34

Pieces.

Total, 7 months ending July, 1917
Total, 7 months ending July, 1916

181
87
180
48
:

12,643,409 !
26,306,940
15,377,503
7,155,097
6,801,912 i
15,273,481 i
3,891,515 i

Pieces.

Amount.

4,228 i863,629,153
100 2 3,234,912

95.2
4.8
100.0

6,511,943

4,328

06,864,065

10,809,917
10,098,085
6,186,816
4,930,660
8,012,105
1,859,768

7,597
4,444
2,047
1,209
3,474
1,384

135,229,697
82,588,496
41,312,591
28,151,638
70,637,179
20,617,180

1,040

87,449,857 |

266 j 48,409,294 I 24,483

445,400,816 j

345

28,296,468 |

137 ! 25,860,097

164,248,709

9,107

1
Of the above amount, bankers' acceptances totaling $56,756,503 were based on imports and exports and $6,872,650 on domestic trade
transactions.
2
All of the above trade acceptances were drawn abroad on importers in the United States and indorsed by foreigh banks.




718

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917..

Acceptances bought in open market and held by Federal Reserve Banks as per schedules on file with the Federal Reserve Board
or as reported by the Federal Reserve Banks on dates specified, distributed by classes of accepting institutions.
Banker's acceptances.
Date.

Member
banks.

Feb. 22
Apr. 5
May3
June 7
July 3
Aug. 2
Sept. 6
Oct. 4
Nov. 1
Dec. 6
Jan. 3
Feb. 7
Mar. 6
Apr. 3
Mayl
June 5
July3
Aug. 7
Sept. 4
Oct. 2
Nov. 6
Dec. 4
Jan.l
Feb.o
Mar. 5
Apr. 2
May 7
June 4
June 11
June 18
June 25
July 2
July 9
July 14-16
July 31
Aug. 15




1915.

1916.

1917.

Nonmem- Nonmember trust ber State
companies. banks.

$93,000
3,653,000 $7,820,000
5,038,000 8,189,000
5,242,000 4,516,000
4,342,000 5,267,000
5,350,000 5,407,000
6,087,000 6,305,000
9,000,000 4,898,000
8,4.77,000 4,331,000
12,311,000 5,172,000

$10,000
10,000
10,000

" 26,666
20,000
132,000
253,000
275,000

Private
banks.

$110,000
110,000
192,000 j
161,000 !
352,000 i
472,000 |
343,000 i
204,000 !
396,000

Foreign
bank
branches
and agencies.

Total.

Trade acceptances Total acbought in ceptances.
open
market.

$93,000
11,593,000
13,347,000
9,960,000
9,770,000
11,129,000
12,884,000
14,373,000
13,265,000
18,154,000

$93,000
11,593,000
13,347,000
9,960,000
9,770,000
11,129,000
12,884,000
14,373,000
13,265,000
18,154,000
23,838,000
8489,000 25,838,000
462,000 28,503,000
722,000 39,030,000
1,477,000 45,767,000
2,208,000 51,568,000
3,422,000 67,633,000
4,225,000 77,658,000
3,673,000 78,659,000
2,306,000 72,542,000
2,378,000 82,783,000
4,487,000 103,166,000

15,494,000
15,681,000
17,182,000
21,000,000
24,875,000
24,680,000
32,989,000
39,695,000
41,413,000
37,798,000
37,770,000
47,748,000

160,009
876,000
670,000
573,000
400,000
029,000
921,000
060,000
356,000
782,000
474,000
232,000

362,000
336,000
408,000
473,000
585,000
644,000
471,000
738,000
726,000
712,000
1,014,000
1,630,000

822,000
1,456,000
1,781,000
3,262,000
3,430,000
7,007,000
11,830,000
13,940,000
12,491,000
9,944,000
12,147,000
16,069,000

23,838,000
25,349,000
28,041,000
38,308,000
44,290,000
49,360,000
64,211,000
73,433,000
74,986,000
70,236,000
80,405,000
98,679,000

66,803,000
50,361,000
53,288,000
43,979,000
49,192,000
69,262,000
81,196,000
103,314,000
113,786,000
117,555,000
117,991,000
108,597,000
112,433,000
85, IIS, 000

625,000
511,000
518,000
328,000
650,000
611,000
043,000*
776,000
738,000
496,000
260,000
390,000
107,000
087,000

1,502,000
972,000
1,090,000
689,000
236,000
584,000
946,000
1,296,000
2,260,000
2,242,000
2,549,000
3,333,000
2,564.000
2,177; 000

18,224,000
13,775,000
20,581,000
16,830,000
19,177,000
21,077,000
22,604,000
23,860,000
31,215,000
32,137,000
32,484,000
38,082,000
20,782,000
14,137,000

121,154,000
S140,000 88,759,000
354,000 107,837,000
200,000 82,026,000
94,000 88,349,000
239,000 118,773,000
239,000 137,028,000
1,301,000 168,547,000
3,165,000 196,164,000
3,287,000 203,717,000
3,095,000 205,379,000
3,805,000 184,785,000
1,087,000 179,973,000
1,345,000 140,S94,000

4,585,000
4,041,000
2,535,000
1,144,000
1,679,000
3,022,000
3,723,000
3,611,000
4,129,000
4,429,000
4,923,000
4,660,000
4,242,000
2,300,000

125,739,000
92,800,000
110,366,000
83,170,000
90,028,000
121,795,000
140,751,000
172,158,000
200,293,000
208,146,000
210,302,000
189,445,000
184,215,000
143,194,000

719

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

Amounts of bills discounted and acceptances and warrants bought by each Federal Reserve Bank during July, 1917, distributed
by maturities.
15-day maturities.
Banks.

Acceptances.

Discounts.

30-day maturities.

Warrants.

Total.

Discounts.!

Warrants.

tances.

Total.

. |_
Boston
New York
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis...
Kansas City...
Dallas
San Francisco.

S35.073 960
251,205. 950
18.S62. 985
8,315. 850
28.559, 333
1,398.738
22.612. 209
12,080 01
3,922, 0-10
14,555: 970
1,330, 400
2,392, 721

858,522
551,065
i 138,000
| 33.333
j 174.000
i 391,519
i
3.117

!
i

S100,000

09.750
197,200

i. 310,779 j 1,617,112

Total.

835,132,482
254,757,015
19.000,985
8.349.183
28.833.333
1.790.257
22.015.326
12,080,017
3.922.040
1-1.555.976
1.100,150
2.589,921

:

100,000
,

Per cent.

405,027.891
!

811,817
S2,760.025 :
'428.914 ; 1,303,624
403,791 ; 1,025,374
1,605 I
275.794 i
800,459 ! 1.698,500 !
49,000 I
235,517 ;
241,659 i
5,183,125 i
615,005 i.
329.286 : .
!
183.357 .
437,985 j.
195;304 ;
454,265 j.
661,891 !
12,072.528 '•• 5,223,829 j
!

76.7

60-day maturities.

'

$2,771,842

i;732,538
1.429.165
277.399
2.498,959
284,517
5,424,784
615.005
329.286
183,357
633,289
1,116,156
17,296,357

j

90-day maturities.

Banks.
Discounts. ! ^ a n c c s
Boston
New York
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis...
Kansas City...
Dallas
San Francisco.

81,583,857 I,568,031
1,682,261
868,411
940,462
879,227
1,002,308
352,278
2,161,691
843,840
1,602,495
55,300
3,805,235
682,736
1,730,948
322,000
1,628,948
303,246
574,514
.!
725,086 1,444,212
1,155,333 2,682,698

Total.
Per cent

Warrants,
I
!
!
!
1
j
!
I
!
!

18,053,738 |10,001,985
i
Over 90-day maturities.

Banks.
Discounts.
Boston
New York
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis...
Kansas City...
Dallas
San Francisco.
Total....
Percent




8325 I 866,092
!
2^ 667^ 424i
1, 870"j 96,068 !

6,897 j! 950,000 !
221,913 !
113,537
159,532
900,000
28,917
15,528
1,177,100
511,671 "6GG,"6i8'
843,903
100,000
244,687
00,000
3,310,352 ,0,521,130

Warrants.

Total.

Discounts.

Warrants.

!
:
:

S3,151,888 83,012,317 81,698,984 !.
2,550,672
0,048,980 i 22,288,834 \.
6,762,400 ..
1,819,689
1,900,750
5,198,603 !j :
\ 1,414,586
1,212,024
202,986 .
1 3,005,537
2,770,582 1
897,656 '
19,650 .
! 1,657,795
;
1,851,326
;
4,200,545
i.
4,487,971
:
948,110
!.
2,052,948
925,859 I
13,000 i.
I 1,628,948 1,748,877 !
!
877,760
311,488 i 2,297,927 !..
: 2,169,898
500,023 !..
1,087,612 !
230,941 !..
j 3,838,031
1,552,485 I

84,711,301
28,337,814
8,729,150
6,410,627
2,973,568
917,306
6,117,871
1,873,975
1,761,877
2,609,415
1,053,635
1,789,426

I 28,055,723
!
5.4

67,885,965
12.9

23,385,950 j 44,500,009 !.

Per cent.

Total.
Discounts.

Acceptances.

800,417 842,430,484
1262,360,105
i2*009*294* 1 22,175,858
. 102,905 10,872,873
1,171,913 34,513,978
',247,943
113,537
1,059,532 33,611,427
44,445 15,381,400
8,806,257
1,177,100
1,177,089 16,137,000
4,182,905
943,903
6,007,117
301,087

403,446
012,534
472,425
681,887
809,332
515,469
094,057
285,044
13,000
207,191
017,970
031,104

Total.

Total.

Warrants.

Total.

DisAccept- Warcounts. ances. | rants.

T

92.6
91.3
65.9
05.4
89.7
89.2
84.7
92.3
99.9
83.2
61.5
62.3

7.4
8.7
34.1
34.6
10.1
10.8
15.3
7.7
.1
16. 8
38.5
37.7

.:8,831.482 460,733,353 66,864,065 | 100,000 527,697,418 | 87.3
100.0 I.
.:
1.7

12,7

1
'845,833,930
I
:287,378,639
:
!
33,648,283
:
!
16,554,760
!S100,000 38,483,310
:1 4,703,412
!
39,705,484
I 16,667,050 i
i1 8,819,257 !
19,404,191 i
6,800,881 I
9,038,221 !

0.2

Total.
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
1 100.0

720

SEPTEMBER 1,1917.

FEDERAL RESERVE BULLETIN.

Maturities of discounts, acceptances, and municipal warrants held by the Federal Reserve Banks on Friday, July 27, 1917,
[In thousands of dollars; i. e., 000 omitted.]

1 to 15 days.
Banks.

Bills
discounted.

Boston
New Yo r k
Philadelphia

Cleveland
Richmond..
Atlanta

Chicago..
St Louis
MinneapoHs
Kansas Citv
Dallas
San Francisco
Total
Per cent

Accept- Municiances pal warbought. rants.

5,835
9,914
6,670
4,751
5,657
1,667
12,294
7,775
2,742
8,426

2,856
20.141
1,911
3,519
1,921

824

666

50
153
3
115

742

7,803
1,242
175

1,945

2,876

2,871

69,431

45,792

321

16 to 30 days.

Total.

Accept- MuniciBills
ances
pal wardisbought.
rants.
counted.

8,691
30,105
8,734
8.273
7,693
2,409
20,097
9,017
2,917
10,371
1,490
5,747

1,859
998
690
558

2,439

870
747
496

115.544
34.5

Bills
discounted.
3,491
3,143
1,087
1,825
3,507
1,999
5,464
1' 866
3,148
1 026
1,036
3,585

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St Louis
Minneapolis
Kansas City
Dallas
San Francisco
Total.
Per cent

31,177

Acceptances
bought.

5
1,023

570
624

63,254

2,059

5i

927
214

3,216 1
905
105

975

1,597
13,899

30,900 i

3,167
1,557
1.854
51

44,850
13.4

61 to 90 days.

Municipal warrants.

8,619
28,696
3,453
2,J29
270
278
11,195
1 017
12
6 391

4,545
17.252
1'. 486
2.668
3,366
1.112
4,864
2,004

796

2,420 I
1.081
'257

31 to 60 days.
Banks.

2,686
16,254

898

1,648
1,099

Total.

1,028

Total.

Bills
discounted.

12,110
31,839
4,545
4,977
3,777
2,277
16,659
2 883
3,160
7,417
1,606
4,209

2,546
5.052
1,069
830
2,327
770

95,459
28.5

18,742

569
720

1,933
581
1,309
1,036

!
Accept- i Municiances ! pal warbought. | rants.
2,545
30,715
8,385
4,580
1,088
76
4 543 *
963 !
13
1 769

5,091
35,767
9,454
5,430
3,415
846
5 112
1 683
1^946
2 350
1 714
1,105

20

405
69

55 151 '

Total.

90

73,913
22.1

i

Total.

Over 90 days.
Banks.

Boston
New York
Philadelphia
Cleveland . .
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Total
Per cent




; Accept- MuniciBills
pal
ances
diswar- Total. counted.
counted. bought. rants.
Bills
dis-

10
4
451
270
203

3

00

1,942
749

1,282
244

5,210

46

... ... ..
49

13,731
19,107
10
9,526
7
7,968
451
14,381
270
5,604
203 • 20,178
55
11,515
1,942
10,635
749
11,529
1,328
4,947
244
9,338
5,259
1.5

138,459

Percentages.

Total.

Accept- Municipal
ances
warbought. rants.
Amount.
16,706
95,806
14,545
12,287
4,206
1,310
26,757
4 127
305
12,525
2,702
3,821
195,097

50
158
1,100
115

46
1,469

30 437
114,963
24 229
21 355
18,702
6,914
46,935
15,642
10.940
24;054
7,695
13,159
335,025

Bills Accept- Municipal
ances
diswar- Total.
Per counted. bought. rants.
cent.
oi
34.3
7.9.
fi 4
5.6
2.1
14.0
4.6
3.3
7.2
2.3
3.9
100.0

45 1
16.6
39.3
37.3
76.9
81.1
43.0
73.6
97.2
47.9
64.3
71.0

54.9
83.3
60.0
57.5
22.5
18.9
57.0
26.4
2.8
52.1
35.1
29.0

0.1
5^2
.6

.6

100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0

721

FEDERAL RESERVE BULLETIN.

SEPTEMBEB 1, 1917.

Total investment operations, exclusive of purchases of United States certificates of indebtedness, of each Federal Reserve Bank
during the months of July, 19.17 and 1916, and the seven months ending July SI, 1917 and 1916.

Federal Reserve J?anl-:s.

member
banks.

Bankers'
Trade acacceptances. ceptances.

$3,403,446
S42,430,484
25,012,534
262,366,105
11,208,840
22,175,858
5,412.332
10,872,873
3,869,332
34,513,978
504,769
4;247,943
6,047,050
33.611,427
1,285'. 644
15'. 381,406
13,000
8,806,257
3,267,191
16,137,000
4,182,905 1 2.617.976
' 9S7i 039
6,007', 117 I

Boston
New York
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas C i t y . . .
Dallas....."....
San Francisco.
Total,
Total,
Total,
Total,

Bills bought in open market.

Bills discounted for j

July, 1917
July, 1916
7 months ending July, 1917
7 months ending July, 1910

460,733,353
20,183,000
1,419,914,522
82,726,900

63,629,100
34,802,200
433,371,115
156,741,100

Municipal warrants bought.

City.

Total.
$3,403.446

66.864,065
36,575,700
445,400,846
164,248,800

$100.000

3£ per
cent.

2 per cent. ! 3 per cent.

Boston
New York
Philadelphia..
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis..
Kansas C i t y . .
Dallas.
San Francisco.
Total, July, 1917
Total, July, 1916
Total, 7 months ending
July, 1917
Total, 7 months ending
July, 1916

1-year
Treasury
notes.

4 per cent.

31,500,000
$1,000,000

$05,000

2,000
7,500

67,000
10,000

18,539,050

14,047,200

185, "410

18,578,150

34,819,850

3,632,820

$498,800
2,040
3,301,800

1,000,000
$34,250

5,314,000

4,128,000

50,000

$202,500
652,220
377,600

100,000
7,254,500
15,118,317
62,755.600

Total investment operations.
Total.

July, 1917.

845, 83,93
878,039
31,500,000 I1 288,
33, 648,283
1,065,000
17, ,619,760
483,310
,764,512
1,100
,488,084
16,782,000
57,800
10, ,724,850
2,000
8,,821,2o7
7,500
19, ,411,091
G, 800,881
190,050 j
9, 828,871

1,

1,100
16,782,000
57,800

$331,250

S100.000

100.000
6,553,200
14,464,057
59,076,200

United States bonds and Treasury notes.
Federal Reserve Banks.

Total.

--!

25,012.534
11.472.425
5; 681.887
3,869.332
10,700
515,409
6,094,057
47,007
1,285,644
13,000
3,267,191
2,617,976
2,644,065 ; 3,631,104
$263,585
269,555

3,234,912
1,773,500
12,029,731
7,507,700

AD
other.

State.

19,606,650 i 547,304,008
341,250 !
I
38,159,040 ;i,918,592,725
42,630,670 |

July, 1916.

§6,586,600
16,652,450
7,318,400
4,019,400
4.715,000
i; 927,700
8,326,800
3,762,600
2,379,700
869,500
2.481,900
4/714,400
04,354,450

July,
1917.

July,
1916.

P.ct.

P. ct.
10.2
25.9
11.4
7.2
7.3
3.0
12.9
5.8
3.7
1.4
3.9
7.3

8.4
52.7
6.1
3.2
7.0
0.9
10.3
3.2
1.7
3.5
1.2
1.8
100.0 !

100.0

352,301,970

United States securities held by each Federal Reserve Bank on July 31, 1917, distributed by maturities.
United States bonds with circulation
privilege.

United States securities without circulation privilege.
Total.

3 per cent 3 per cent 1
1

2 per cent ! 2 per cent 3 per cent 4 per cent converloan of ! loan of
consols of I Panamas
sion bonds
1918.
j 1925.
1930.
of 1936-38.
of 1946-47.
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
KansasCity
Dallas
San Francisco
Total

j
j

S750 •.
50

6,400
915,100 I
040,600
1,862,500
100
;....;
323,050 !\
! 7,155,850 1
' 2,450,900
! 2,428,750 '
I 15,784,050

notes,

P?
1i c e n t i o a n
i 011Jbi-

§529,000 S2,194,000 !.
1,255,500 3,538,000 ! .
850,000
549,200 2,548,000 .
$100
414,800 2,865,000 :.
407,200 '2,"65i,'o66";S2,"378,"266'
237,000
1,969,000 I.
10,300 1,491,000 '
21,000
427,400 3,361,000 i
367,300 2,581,000 1,768,000
1,080,000
1,153,300 1,444,000 1
206,250
114,800 1,340,000 !
16,200 1,198,180
I 825,000
838,500 1,784,000 I
22,240
1,233,600 1,430,000 j
281,500
1,500,000 !
1,412,600

7,560,740

Total Uniied States bonds with circulation privilege, 529,934,840.




1-v

:

5,177,450

6,526,400 25,464,000 i

cent Liberty Loan
of 1947.
§2,723,750
6,343,550
3,097,300
8,783,160
3,121,100
2,190,700
27,800
4,588,840 14,956,440
3,709,000
31,600
3,199,040
7,500 10,633,090
3,800
5,399,800
26,000
3,954,750

§1,500,000

S400
500

900

6,185,540

68,111,680

Total United States securities without circulation privilege, 838,176,840.

722

FEDERAL EESEEVE BULLETIN.

SEPTEMBER 1,1917.

RESOURCES AND LIABILITIES OF FEDERAL RESERVE BANKS.
Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at close of business on Fridays
July 27 to Aug. 24, 1917.
'
'
RESOURCES.
[In thousands of dollars; i. e., 000 omitted.]
New Phila- Cleve- Rich- Atlan- ChiBoston. York. delphia.
land. mond.
ta.
cago.
Gold coin and certificates in vault:
July 27
Aug.3
Aug. 10
,
Aug.17
Aug. 24
Gold settlement fund:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Gold with foreign agencies:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24,
Gold with Federal Reserve Agent
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Gold redemption fund:
July 27
Aug. 3
Aug. 10
Aug.17
Aug. 24
Legal tender notes, silver, etc.:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Total reserves:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Bills discounted—members:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Bills bought in open market:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
United States Government longterm securities:
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
United States Government shortterm securities:
July 27
Aug. 3
Aug. 10
Aug.17
Aug. 24
Municipal warrants:
July 27
Aug. 3
Aug. 10
Aug.17
Aug. 24




32,685
24,884
25,266
26,372
26,534

234,737
202,722
216,580
199,222
229,517

41,215 33,342
22,201 32,747
25,443 32,174
27,506 31,341
28,739 29,869

8,811
7,744
5,811
13,855
17,553

120,367
255,667
187,101
166,408
117,279

20,232
10,482
13,496
22,568
26,867

3,675
3,675
3,675
3,675
3,675

18,112
18,112
18,112
18,112
18,112

3,675
3,675
3,675
3,675
3,675

4,725
4,725
4,725
4,725
4,725

21,891
24,890
24,868
24,846
25,832

173,670
202,670
218,462
228,312
206,898

32,905
32,904
32,813
32,539
32,161

30,880
30,876
30,794
30,747
32,121

500
500
500
500

5,250
5,250
5,250
5,250
2,500

450
450
550
700
700

22
22
13
56
44

3,952
3,581
3,276
3,445
3,724

37,391
39,314
39,718
39,632
39,406

1,480
1,347
1,601
1,331
1,204

71,512
65,274
63,396
72,693
77,818

589,527
723,735
685,223
656,936
613,712

99,957
71,059
77,578
88,319
93,346

St.
Louis.

Kansas Dallas.
City.

San
Francisco.

Total.

6,450
6,483
6,217
6,257
6,228

7,613
7,295
7,139
7,074
7,007

39,744
40,353
40,057
40,305
40,115

4,752
4,703
4,951
4,728
4,337

17,792
16,323
16,629
16,931
17,092

8,522
8,711
8,935
8,365
8,469

14,195 19,717
14,467 18,896
13,132 17,326
13,460 17,637
13,681 15,153

4G0,764
399,785
413,849
399,198
426,741

45,443 43,800
35,790 22,258
45,989 23,353
52,928 23,053
54,347 30,798

7,921
2,339
3,464
2,466
5,684

53,086
27,082
45,666
41,252
46,481

23,888
20,698
28,701
22,271
25,678

11,476
8,995
8,558
7,443
7,871

39,140
34,210
i 31,980
i 38,399
38,263

8,674 22,901
3,248
9,640
2,042 13,691
4,212 15,647
6,025 20,221

405,739
438,153
409,852
410,502
397,067

1,575
1,575
1,575
1,575
1,575

7,350
7,350
7,350
7,350
7,350

2,100
2,100
2,100
2,100
2,100

2,100
2,100
2,100
2,100
2,100

2,625
2,625
2,625
2,625
2,625

56,653 14,911
59,234 14,891
59,943 14,871
64,555 15,971
70,007 15,953

21,366
21,349
21,140
21,124
19,292

1,837
1,837
1,837
1,837
1,837

7,483 18,072
7,483 18,778
8,416 I 18,9S4
8,353 i 20,089
8,781 i 18,902

1,838
1,838
1,838
1,838
1,838

2,888
2,888
2,888
2,888
2,888

52,500
52,500
52,500
52,500
52,500

14,635 15,624 26,103
14,588 14,095 26,087
14,548 14,076 26,552
14,507 14,056 27,539
14,476 15,636 28,487

434,193
467,845
485,467
502,588
488,546

854 "
880
866
854
850

351
363
412
417
602

236
238
242
243
244

390
388
386
385
382

338
528
277
456
589

491
514
513
524
522

170
245
260
395
427

17
12
5
15
15

9,067
9.390
9; 274
9,795
7,375

519
428
588
629
491

200
170
189
141
131

760
759
713
653

2,425
3,246
2,654
3,120
3,413

2,951
2,681
2,108
1,760
1,593

252
356
360
405
347

478
440
396
313
334

1,320
1,291
1,355
1,291
1,153

127
95
113
126
91

51,789
53,709
53,117
52,906
52,540

114,931
104,588
114,283
120,426
121,597

60,624
39,111
40,878
40,495
48,625

36,226
31,110
32,333
32,284
34,423

159,494
137,503
155,912
156,825
167,610

48,992
45,461
53,117
47,215
;50,043

13,731
16,252
15,810
17,016
16,959

19,107 9,526 7,968
11,855 8,999 9,966
13,311 10,216 10,558
13,582 13,168 10,231
15,327 9,762 5,950

14,381
14,575
14,574
15,945
13,691

j 5,604
! 4,851
i 4,965
! 5,434
; 5,690

20,178
19,864
16,769
16,310
12,757

11,515
8,330
9,191
9,641
8,657

10,635
10,752
11,285
13,197
12,727

11,529
10,287
12,428
13,730
12,206

4,947
5,730
6,113
6,997
6,942

9,338
9,487
9,009
8,695
7,739

138,459
130,948
134,229
143,946
128,407

16,706
15,976
16,207
18,749
17,544

95,806
73,687
56,510
56,791
49,898

14,545 12,287
16,557 16,595
16,894 18,026
17,630 17,098
18,608 20,026

4,206 ! 1,310
4,290 ;
968
3,626 i
680
3,182 j 668
2,384 i 1,608

26,757
23,825
19,220
18,392
19,601

4,127
3,844
3.201
2,813
5,461

130
130
25
2,281

12,525
11,756
10,739
11,198
11,504

2,702
2,163
2,036
2,531
1,985

3,821
4,392
2,521
6,252
8,657

195,097
174,183
149,790
155,329
159,557

530
530
610
610
610

1,306
2,805
1,306
2,806
2,805

549 5,918
549 5,918
549 i 5,918
549 i 7,918
549 i 7,918

1,152
1,152
1,152
1,152 i
1,192 !

704
704
704
704

11,609
11,376
11,651
12,004
12,062

2,266
2,255
2,255
2,255
2,255

1,859
1,859
1,859
1,859
1,859

8,849
8,849
8,849
8,849
8,849

3,970
3,970
3,970
3,970
3,970

2,429
2,455
2,453
2,453
2,453

41,135
42,422
41,276
45,129
45,226

2,194
2,194
2,194
2,194
2,194

3,538
5,038
3,538
3,538

1,584
1,491
3,522
3,522
3,522

4,409
3,361
3,630
3,364
3/360

1,524
1,444
1,471
1,471
1,465

2,015
1,340
1,564
1,554
1,554

1,784
1,784
1,789
1,784
1,784

1,430
1,430
1,896
1,868
1,868

3,448
1,500
3,900
3,767
3,760

35,818
25,464
32,604
30,552
30,480

50

2,548
2,548
2,548
2,548
2,548
158
106
131
131
131

2,933
2,865
3,083
2,973
2,918 |

1,969
1,969
1,969
1,969
1,969

1,100
1,097
1,097
1,046
1,055

u.

i
:.
!.
i.
i.

53,324 65,891 41,821 71,753 1,414,052
49,651 61,088 35,184 57,618 1,421,382
49,064 58,997 32,703 60,575 1,424,059
48,459 64,733 35,252 63,852 1,427,489
47,291 64,689 38,760 66,855 1,424,769

46
46
46
46
46

1,469
1,249
1,274
1,223
1,232

723

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at the close of business on Fridays^
July 27 to Aug. 24, 1917—Continued.
RESOURCES-Continued.
[In thousands of dollars; i. e., 000 omitted.]
New
Phila- Cleve- i Rich[Boston. York.
delphia. land. j mond.
Due from other Federal Reserve
Banks—net:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
,
Uncollected items:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 24
Five per cent redemption fund
against Federal Reserve Bank
notes:
July 27
,
Aug. 3
Aug. 10
Aug. 17
Aug. 24
All other resources:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Total resources:
July27
Aug. 3
Aug. 10
Aug. 17
Aug. 24

6,603
6,115
4,554
11,428
15,298
14,481
13,931
16,867
14,441

9,478
3,373

3,062 I
3,884 I 5,227
2,302
6,244

43,686 24,247 i 18,577 j11,200
43,202 28,782 I 14,272 \11,148
44,696 27,417 • 16,411 9,843
52,622 ; 31.522 j 18,067 12,275
58,652 28', 539 ! 16,714 12,417

126.574 759,462
120', 822 858,822
116,702 '806,084
139,557 786,275
130,205 743,932

151,530
138,078
1138,706
1153,867
|153,483

166,855
1159,201
169,377
j 177,769
176,178

Chicago.

4,967
3,042
1,278
3,299
1,416

21,255
31,318
14,069
28,541
22,253

161
4,029

10,660 40,218
9,343 28,240
10,589 32,263
10,779 39,020
9,421 27,354

9,574
11,485
12,356
13,450
10,011

80
78
135
72

10 |

Minne- Kansas
St.
Louis. apolis. City. Dallas.

Atlanta.

595
586
4,901
7,010
6,401
6,504
5,076

271
64
28
1,570
10

93,744 61,129 283,920
77,540 51,587 255,487
74,344 54,206 253,514
81,262 56,762 274,456
80,278 56,850 264,997

1,201
5,028
360
458

53

San
Francisco.

Total.

9,834
8,910
2,884
5,068
3,C33

111,106
14,746
2 1,655
1 11,688
1243

10,175
8,953
11,884
12,279
8,118

204,756
197,058
205,761
230,704
210,387

13,472
10,715
9,073
10,739

6,521
6,670
9,255
8,246
8,905

400
400
400
400
400

100
100
100
100
100

500
500
500
500
500

23
16
5

445
218
233
230
179

84

1,057
492
425
1,882

78,430
76,912
81,619
78,415
78,488

73,101
70,774
70,326
72,193
70,788

110,700
108,853
108,950
110,127
110,629

61,982
55,511
56,352
59,293
62,755

110,798
93,315
93,226
102,366
100,699

2,021,237
1,998,444
1,988,263
2,048,442
2,001,140

LIABILITIES.
Capital paid in:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Government deposits:
July27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
.Duo to members—reserve account:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Due to nonmember b a n k s clearing account:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Collection items:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Due to other Federal Reserve
Banks—net:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24




5,134
5,135
5,135
5,141
5,373

12,067
12,091
12,125
12,119
12,123

11,635 16,113
6,662 6,338
4,415 94,601
19, 069 33,472
9,112 4,126

72,885
70,603
68,393
72,252
72,319

444,489
515,814
431,518
440,849
420,957

6,365
6,365
6,365
6,365
6,365

3,444
3,444
3,443
3,443
3,470

2,387
2,387
2,387
2,382
2,507

7,465
7,465
7,513
7,647
7,651

3,267
3,267
3,267
3,261
3,260

2,520
2,523
2,524
2,524
2,5*24

3,175
3,197
3,203
3,203
3,203

2,757
2.756
2,757
2.757
2,757

3,968
3,974
3,974
3,974
3,974

57,825
57,881
57,970
58,093
58,484

7,671
5,497
2,764
ti, 760 6,310
1,809 6,287

18,190
8,445
5,903
12,530
5,578

8,242
3
716
1,418
1,828
1,021

38,4.46
11,318
13,581
11,831
11,245

2,474
4,088
2,231
425
3,071

6,008
3,035
4,430
5,503
5,535

7,374
5,712
3,767
4,297
3,446

6,726
1,391
2,354
3,565
3,042

18,208
4,789
1,976
6,824
5,700

143,032
56,765
14.0,447
110,110
59,972

36,518
36,801
36,136
36,819
35,800

65,612
65,227
66,697
66,072
66,858

5.276
5,277
5,277
5.277
5,277
1,915
206
3.007

67,541 100,942 36,724 25,503 150,831 I 45,580
66,053 98,344 36,547 25,604 147,992 i 43,066
65,829 94,601 36,528 25,048 146,205 ! 43,100
03,936 104,848 35,410 25,472 150,288 43,485
70,694 104,649 37,275 26,740 150,525 43,762

28,956 59,875 1,135,456
29,504 57,332 1,192,887
28,915 58,644 1,101,614
28,954 62,432 1,130,817
29,980 61,570 1,121,129

8,451

11,879
10,018
11,461
30,924
10,128
11,073
10,201
13,452
13,745

28,976
26,743
24,046
30,184
24,841

1,746
22,355
24,841
21,774
36,617
26,250

14,395 10,660
11,307 10,818
12,636 9,347
16,592 10,326
13,729 10,671

5,087
4,292
5,083
5,654
4,794

18,363
18,976
15,568
32,316
18,226

7,555
7,593
9,274
7,442

2,987
3,240
2,597
2,952
2,517

7,072
7,055
6,347
7,011
7,283

3,573
2,826
2,860
2,875
3,659

34,666 12,771
799
63 1,509
7,180
656
534
67,268
589
308
13,946
14,095
6,205
1,523
36.615
1,415 4,347
139 |
589
15,425 6,488 2,788 2,713
1 Difference between net amounts due from and net amounts due to other Federal Reserve Banks.
2 Net amount due to other Federal Reserve Banks.
3 Overdraft.

96
390
256
176
263

8,547
12,269
10,274
11,637
32,933

5,512
3,327
4,441
4,663
4,798

137,815
132,053
122,493
171,916
137,955

724

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917.

Resources and liabilities of each Federal Reserve Bank and of the Federal Reserve System at close of business on Fridays,
July 21 to Aug. 24, 1911—Continued.
LI ABILITIE S—Continued.
[In thousands of dollars; i. e., 000 omitted,]
New
Phila- Cleve- RichBoston. York.
delphia. land. mond.
Federal Reserve notes in actual
circulation:
July 27
26,484
Aug. 3
27,016
Aug. 10
28,203
Aug. 17
28,671
Aug. 24
29,323
Federal Reserve Bank notes in
circulation, net liability:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 2 4 . . :
All other liabilities, including foreign Government credits:
July27
308
Aug.3
333
Aug. 10
355
Aug. 17
372
Aug. 24
333
Total liabilities:
July 27
126,574
Aug. 3
120,822
Aug. 10
|116,702
Aug. 17
' 139,557
Aug. 24
130,205




213,182 41,425
216,321 41,471
218,478 42,582
220,195 42,638
224,151 42,728

37,482 17,546
37,688 18,286
38,916 19,086
39,307 19,499
42,358 20,518

Atlanta.

Chicago.

Minne- Kansas
St.
Louis. apolis. City. Dallas.

19,910
20,020
20,270
21,426
21,788

68,812
69,700
70,609
72,279
75,537

18,402
18,936
19,223
20,447
20,953

24,269 24,945
24,641 24,834
24,331 24,754
24,377 24,628
24,227 24,344

18,461 23,097
18,378 23,494
18,877 23,915
21,052 24,263
22,728

i

2,459
2,828
4,182
4,907
5,473
1,518
2,368
1,352
1,380
11,385

217
230
237
224
237

759,462
858,822
806,084
786,275
743,932

151,530
138,078
138,706
153,867
153,483

!
j
!
!

37
48
53

3
36 I
38
95
67

1166,855 93,744 61,129 283,920 78,430
:159,201 77,540 51,587 255,487 76,912
1169,377 74,344 54,206 253,514 81,619
1177,769 81,262 56,762 274,456 78,415
1176,178 80,278 56,850 264,997 78,488

18
46
73,101
70,774
70,326
72,193
70,788

San
Fran-

534,015
540,785
549,244
558,782
573,049
2,459
2,828
4,182
4,907
5,473

2,976
2,039
2,180
12,145

22 i
110,700
108,853
108,950
110,127
110,629

Total.

61,982
55,511
56,352
59,293
62,755

110,798
93,315
93,226
102,366
100,699

021,237
998,444
988,263
048,442
,001,140

725

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1917.

FEDERAL RESERVE NOTES.
Federal Reserve note account of each Federal Reserve Bank at close of business on Fridays, July 27 to Aug. ,

1917.

[In thousands of dollars; i. c., 000 omitted.]
New Phila- Cleve- Rich! Boston. York.
delphia. land. mond.
Federal Reserve notes received '
from agent—net:
July 27
'•;
Aug.3
Aug. 10
i
Aug. 17
'
Aug. 24
!
Federal Reserve notes held by bank:,
July 27
Aug.3
Aug. 10
'
Aug. 17
>
Aug. 24
Federal Reserve notes in actual i
circulation:
July 27
Aug.3
;
Aug. 10
'
Aug. 17
Aug. 24
Gold deposited with or to credit of
Federal Reserve Agent:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 24
Amount of commercial paper delivered to Federal Reserve Agent:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 24




31,891
34,890
34,868
34846
34,846
35,822

i240,170
1239,670
j243,462
246,312
246312
250,898

42,205
42,204
43,613
45,339
45,561

39,880
39,876
42,794
42,747
44,121

5,407
7,874 23,349
6,665 24,984
6,175 26,117
6,499 26,747

780
733
1,031
2,701
2,833

2,398
2,188
3,878
3,440
1,763

26,484
27,016
28,203
ou «Ti
28,671
29,323

213,182
216,321
218,478
non in:
220,195
224,151

21,891
24,890
24,868
24,846
25,832

173,670 32,905 30,880
202,670 32,904 30,876
218,462 32,813 30,794
228,312 32,539 30,747
206,898 | 32,161 32,121

10,116
10,115
10,149
10,164
10,164

77,860
39,202
26,706
18,877
44,644

41,425
41,471
I 42,582
AO C O Q
42,638
42,728

9,301
9,303
10,804
12,805
13,406

37.482
37', 688
38,916
39,307
42,358

9,069
9,076
12,000
12,618
13,508

MinneSt.
Chicago. . Louis. apolis.

18,155 21,563 73,653
18,503 21,749 ! 76,234
19,525 21,955 I 75,993
20)706 ! 22,908 \ 78,945
21,205 j 22,873 81,327

20,368 25,862
20,828 25,845
21,908 26,136
21,638 26,120
22,720 25,788

Total.

25,671
25,598
25,402
25,335
24,881

18,943
18,905
19,019
21,211
23,624
482
527
142
159

,729
,685

4,841
6,534
5,384
6,666
5,790

1,966
1,892
2,685
1,191
1,767

1,593
1,204
1,805
1,743
1,561

726
764
648
707
537

19,910
20,020
20,270
21,426
21,788

68,812
69,700
70,609
72,279
75,537

! 18,402
I 18,936
I 19,223
i 20,447
I 20,953

24,269
24,641
24,331
24,377
24,227

24,945
24,834
24,754
24,628
24,344

7,483 i 18,072
7,483 :: 18,778
8,416 18,984
8,353 20,039
8,781 ! 18,902

56,653
59,234
59,943
64,555
70,007

!
I 14,911
j 14,891
j 14,871
! 15,971
15,953

21,366
21,349
21,140
21.124
19,292

14,635 15,624
14,588 14,095
14,548 14,076
14,507 14,056
14,476 I 15,636

609
217 !
439.:
1,207 !j
687
17,546
18,286
19,086
19,499
20,518

18,389
18,815
18,150
19,127
16,075

i
I
j
i

3,498
2,978
2,978
2,978
3,978

!

18,461
18,378
18,877
I 21,052
22,728

3,006
2,593
2,637
3,276
4,093

50,449
49,604
51,983
54,864
54,258

23,097
23,494
23,915
24,263
24,394

534,015
540,785
549,244
558,782
563,049

26,103
26,087
26,552
27,539
28,487

434,193
467,845
485,467
502,588
488,546

i

4,496
4,496
4,996
4,996
6,496

: 17,199 !5,462
. 17,199 | 5,952
16,244 ! 7,044
! 14,581 I5,670
i 11,509 I 6,772

26,103 584,464
26,087 590,389
26,552 601,227
27,539 613,646
28,487 627,307

:11,099
!11,337
!11,289
!10,861
j11,982

4,175
5,005
5,228
8,034
8,130

1
j
!
I
!

170,664
133,478
i 125,588
' 120,711
j 146,664

;

726

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1, 1917.

Federal Reserve note account of each Federal Reserve Agent at close of business on Fridays, July 27 to Aug. %4f 1917.
[In thousands of dollars; i. e.. 000 omitted.]
Boston.

New
York.

Philadelphia.

Cleve- Richland. mond.

Atlanta.

Chicago.

55,630
55,680
62,680
62,680
62,680

453,160
453,160
459,760
459,760
466,160

66,900
66,900
66,900
66,900
71,500

52,000
52,000
54,000
64,000
64,000

32,980
32,980
34,080
35,040
35,840

37,180
37,180
37,180
37,180
37,180

j106,220
j106,220
,108,820
112,060

10,839
11,290
11,312
11,934
11,958

85,270
87,470
87,778
88,028
88,342

10,195
10,196
10,287
10,561
10,939

6,180
6,184
6,266
6,312
6,439

11,735
11,787
11,915
12,034
12,235

6,877
6,931
7,025
7,172
7,707

44,841
44,390
51,368
50,746
50,722

367,890
365,690
371,982
371,732
377,818

56,705
56,704
56,613
56,339
60,561

45,820
45,816
47,734
57,688
57,561

21,245
21,193
22,165
23,006
23,605

12,950
9,500
16,500
15,900
14,900

127,720
126,020
128,520
125,420
126,920

14,500 5,940
14,500 5,940
13,000 4,940
11,000 14,941
15,000 13,440

3,090
2,690
2,640
2,300
2,400

31,891
34,890
34,868
34,846
35,822

240,170
239,670
243,462
246,312
250,898

42,205
42,204
43,613
45,339
45,561

18,210
21,210
21,210
21,210
22,210

164,705
193,705
207,805
217,905
196,805

4,220
4,220
4,220
4,220
4,220

8,820
8,816
8,586
8,582
10,007

1,681
1,680 8,965
1,658 10,657
1,636 10,407
1,612 10,093

2,025
2,325
2,234
2,460
2,362

2,060
2,060
2,208
2,165
2,114

483
483
416
853
781

26,660
26,359
26,359
25,859
25,579

20,000
20,000
20,000
20,000
20,000

7,000
7,000
8,000
7,500
8,000

10,000 66,500 9,300 9,000
10,000 37,000 9,300 9,000
10,000 25,000 10,800 12,000
10,000 18,000 12,800 12,000
10,000 44,000 13,400 12,000

10,672
11,020
11,109
12,353
12,424

31,891
34,890
34,868
34,846
35,822

18,155 21,563 73,653
18,503 21,749 76,234
19,525 21,955 75,993
20,706 22,908 78,945
21,205 22,873 ! 81,327

St.
Minne- Kansas
Louis. apolis. i City. Dallas.

San
Francisco.

1112,000

31,100
31,100
31,100
32,500
33,700

38,640
38,640
38,640
38,640
38,640

42,720
42,720
42,720
42,720
42,720

36,920
36,920
36,920
36,920
42,920

29,660
29,660
30,160
31,160
32,160

983,160
983,160
1,002,960
1,019,560
1,039,560

2,667
2,686
2,927
3,216
3,433

5,912
5,932
5,952
6,472
6,490

6,188
6,205
6,414
6,630
6,962

7,609
7,682
8,038
8,105
8,559

9,516
9,554
9,775
9,854
10,071

3,557
3,573
3,608
3,621
3,673

166,545
169,490
171,297
173,939
176,808

30,303
30,249
30,155
30,008
29,473

103,553
'103,534
1105,893
1108,844
108,627

25,188
25,168
25,148
26,028
27,210

32,452
32,435
32,226
32,010
31,678

35,111 27,404
35,038 27,366
34,682 27,145
34,615 27,066
34,161 32,849

26,103
26,087
26,552
27,539
28,487

816,615
813,670
831,663
845,621
862,752

8,740
8,500
8,200
7,100

29,900
27,300
29,900
29,899

4,820
4,340
3,240
4,390
4,490

6,590
6,590
6,090
5,890
5,890

20,368
20,828
21,908
21,638
22,720

25,862
25,845
26,136
26,120
25,788

3,353

3,353
3,353
3,353
3,353

14,102
14,102
14,102
14,102
14,102

2,370
2,370
2,370
2,370
2,370

11,110
11,110
12,610
12,610
12,610

718
898
878
858
840

1,014
997
1,288
1,272
940

1,205
1,158
1,118
1,077
1,046

1,010
981
1,062
1,242
2,822

913
897
862
849
1,497

21,568
22,864
24,676
25.051
25,780

13,580 56,210 10,840
13,340 58,810 10,640
13,640 59,550 10,640
14,740 64,181 11,760
14,240 69,658 11,760

6,250
6,250
5,750
5,750
4,250

11,060
11,060
11,060
11,060
11,060

3,504
2,004
404
204
204

25,190
25,190
25,690
26,690
26,990

182,294
182,653
183,093
189.744
193,741

4,496
4,496
4,996
4,996
6,496

11,036
11,010
10,854
10,828
10,405

3,319
4,810
4,943
7,155
7,988

Total.

FEDERAL RESERVE NOTES.

Received from Comptroller:
Juiy27
Aug. 3
Aug. 10
Aug. 17
Aug. ^4
Returned to Comptroller:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 24
Chargeable to Federal Reserve
Agent:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
In hands of Federal Reserve
Agent:
July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
Issued to Federal Reserve Bank,
less amount returned to Federal
Reserve Agent for redemption:
July 27
Aug.3
Aug. 10
Aug. 17
Aug. 24
Collateral held in joint custody of
Federal Reserve Bank and
Agent, as security for outstanding notes:
Gold coin and certificates on
hand—
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
In gold redemption f u n d July 27
Aug. 3
Aug. 10
Aug. 17
Aug. 24
With Federal R e s e r v e
BoardJuly 27
Aug.3
Aug. 10
Aug.17
Aug. 24
Commercial paper required,
minimum i—
July 27
Aug.3
Aug. 10
Aug.17
Aug. 24
TotalJuly 27
Aug.3
Aug. 10
Aug.17
Aug. 24




2,000
2,000
2,000
2,000
2,000

240,170
239,670
243,462
246,312
250,898

42,205
42,204
43,613
45,339
45,561

6,600 | 27,300
I

39,880 18,155 21,563 73,653
39,876 18,503 21,749 76,234
42,794 19,525 21,955 75,993
42,747 20,706 22,908 78,945
44,121 21,205 22,873 81,327

39,880
39,876
42,794
42,747
44,121

3,441
3,442
3,442
3,441
3,338
1,051
1,996
1,902
1,858
1,324

3,491
2,971
2,971
2,869
3,971

443
424
393
374

17,000
17,000
16,050
14,390
11,320

5,457 i
5,937 !
7,037 I
5,667
6,767 I

9,440
9,440
9,280
9,280

8,461
8,461
8,126
5,855
9,225

25,671 18,943
25,598 18,905
25,402 19,019
25,335 21,211
24,881 23,624

25,862 25,671
20,828 25,845 25,598
21,908 26,136 25,402
21,638 26.120 25,335
22,720 25,788 24,881

232,151
223,281
230,436
231,975
235,445

26,103
26,087
26,552
27,539
28,487

230,331
262,328
277,698
287,793
269,015

18,943 26,103
18,905 26,087
19,019 26,552
21,211 27,539
23,624 28,487

i For actual amounts see item "Commercial paper delivered to Federal Reserve Agent" on page 725.

584,464
590,389
601,227
613,646
627,307

150,271
122,544
115,760
111,058
138,771
584,464
590,389
601,227
613,646
267,307

727

FEDEBAL BESEBVE BULLETIN.

SEPIEMBEB 1,1917.

EARNINGS ON INVESTMENTS OF FEDERAL RESERVE BANKS.
Average amounts of earning assetsheld by each Federal Reserve Bank during July, 1917, earnings from each class of earning
assets, and annual rales of earnings on the basis of July, 1917, returns.
Average balances for the month of the several classes of
earning assets.
Banks.

Bills discounted
members.

Boston
New York...
Philadelphia.
Cleveland
Richmond
Atlanta
Chicago
St. Louis
,
Minneapolis..
Kansas City...
Dallas
San Francisco.

Bills bought
in open
market.

warraIlts

$15,957,728 §16,332,064 i 32,723,750
31.245,286 98,304,074 8,209,485
13' 852,692 12,401,445 3,097,300
7,768,822 10,934,816 8,777,870
13,127,263
5,208,280 3,121,100
4,530,617
1,466,792 2,445,087
19,548,953 28,775,366 16,654,994
9,030,886
4,363,285 \ 3,760,090
10,301,700
744,600 j 3,529,900
8,645,964 12,541,200 ! 10,629,057
4,690,962
2,043,860 5,396,000
9,096,242
5,587,655 5,184,266

Total....

147,797,115

Banks.

Bills dis- Bills
counted bought
mem- in open
bers.
market.

United
States
securities.

Boston
New York....
Philadelphia.
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis..
Kansas City..
Dallas
San Francisco

S50,510
89,361
43,877
24,740
43,709
15,925
63,540
28,971
37,670
31,270
17,262
33,046

$45,966
270,724
33,766
29,094
13,526
4,145
75,936
11,836
1,936
34,465
6,843
16,509

87,278
22,200
7,828
19,804
6,917
5,661
37,670
8,599
7,819
20,231
11,331
11,441

Total...

479,881

544,746

166,779

Total.

'

42,669
31,992
170,674

S35,013,542
138,008,181
29,509,801
28,718,530
21,507,127
8,442,931
65,131,938
17,299,747
14,576,200
31,858,890
12,162,814
20,038,837

2,239,087

422,268,538

$249,336
158,364
1,237,022
50,4S4
435
152,625
145,486

198,703,437 73,528,899

Earnings from—




I Municipal
i

Calculated annual rates of earnings from—

Municipal warrants.

Total.

Bills
Bills
dis- bought
counted in
ope
mem- market.
bers.

$103,754
382,942
85,997
77,456
64,304
25,733
177,480
49,818
47,425
86,047
35,520
61,320

Per
cent.
3.73
3.36
3.72
3.75
3.92
4.14
3.83
3.77
4.31
4.26
4.42
4.28

6,490 ! 1,197,896

3. 82

$657
526
3,818
152
2
334
412
81
84
424

United MunicStates ipal
securi- war- Total.
ties. rants.

Per
Per
cent. I cent.

3.31 i
3.24 j
3.20
3.13
3.06
3.33
3.11
3.19
3.06
3.23
4.01
3.48

2.99
3.18
2.97
2.66
2.61
2.73
2.90
2.69
2.61
2.24
2.54
2.60

3.23

2.67

2.25
3.17
2.93

Per .
cent.
3.34
3.26
3.43
3.18
3.52
3.59
3.27
3.39
3.83
3.18
3.51
3.61

3.40

3.34

Per
cent.
3.10
3.91
3.63
3. 54
3.96
3.08
3.33

728

FEDERAL RESERVE BULLETIN.

SEPTEMBER 1,1017.

GOLD IMPORTS AND EXPORTS.
Gold imports and exports into and from the United States.
[In thousands of dollars—i. e., 000's omitted.]
Total corresponding period
during
1916.

Ore and base bullion
United States Mint or assay office bars
Bullion, refined.
United States coin
Foreign coin
Total
EXPORTS.

Domestic:
Ore and base bullion
United States Mint or assay office bars
Bullion, refined
Coin
Total
Foreign:
Bullion, refined
Coin
Total
Total exports
Excess of gold imports over exports since Jan. 1, 1917
Excess of gold imports over exports since Aug. 1, 1914

§243,196
1, 111, 958

DISCOUNT RATES.
Discount rales of each Federal Reserve Bank in effect August 29, 1917.
Maturities.

1

Discounts.

Trade acceptances. ! Qom.
Within 15
days, including 16 to 60 61 to 90
member days, in- days, inbanks'
clusive. clusive.
collateral
notes.
Boston
New York *....
Philadelphia...
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis...
Kansas City...
Dallas
San Francisco.
1
a
3

3 4
34

31-

35

4
4
4
4i
4

44

;l

31
31
31
3-1

41
41
41

H

Rate of 2 to 4 per cent on member banks' 1-day collateral notes in connection with the loan operations of the Government.
3 per cent for member banks' collateral notes if secured by United States certificates of indebtedness.
3 per cent for member banks' collateral notes if sosurod by United States bonds, notes, or certificates of indebtedness.

NOTE.—Rate for bankers' acceptances, 2\ to 4 per cent.




3 3.V

4
4
4
4
4
4
4
4
4
4i
4
4

_
SecuredbyU. AgriculS. certificates
tural
To 60
of indebted- and livenn
ness or Liber- stock
days, in- days,
61 to in90
ty Loan
clusive. clusive.
paper
Bonds. With- over 90
in 90 days.
days.

[ modity
jpaper ma| turing
within
davs.90

f
31
31
31
4

INDEX.
Acceptances:
Distribution of, by classes, maturities, e t c . . 718-721
Drafts and bills up to 100 per cent
658
Growth of the acceptance business
664
Trade acceptance inquiry by Board
657
Assets and liabilities of leading banks of issue, statement showing
681, 682
Business conditions throughout the Federal Reserve
districts
698-714
Cattle raisers, loans to
659
Charters issued to national banks during month
678
Charts showing course of dollar and sterling exchange since 1914
688, 689
Check clearing and collection:
Development of
660-663
Operations during month
680
Commercial failures reported
677
Discount operations of the Federal Reserve Banks.
715
Discount rates in effect
728
Dollar and sterling exchange rates
683-687
Earnings on investments of Federal Reserve Banks.
727
Export licenses in the foreign trade
672-677
Federal Reserve Agents' fund, transactions under..
680
Federal Reserve Bank of New York, letter of, regarding banking cooperation in control of gold
659
Federal Reserve Banks:
Earnings on investments of
727
Resources and liabilities of
722-724
Federal Reserve districts, description and population of
668-671
Federal Reserve notes:
Accounts of Federal Reserve Banks and Agents.
725
Issued, redeemed, etc., during year through
office of Comptroller of the Currency
667
Fiduciary powers granted to national banks
678
Foreign banks of issue, comparative statement showing condition of
681, 682
Foreign trade, export license forms for use in
674-677
Gold imports and exports
728
Gold settlement fund, summary of transactions.. 678-680
Governor and vice governor of Federal Reserve
Board redesignated for ensuing year
659




Informal rulings of the Board:
Page.
Bankers' acceptances drawn against shipment
of goods from a corporation to its agent
690
Conversion of a State bank into a national bank.
690
Paper secured by chattel mortgage on c a t t l e . . .
690
Purchase of bank's own acceptances
691
Loans on real estate
691
Custody of gold, lawful money, and Federal
Reserve notes
691
Law department:
Deductions in determining reserves
Private bankers as members
Section 22 of the Federal Reserve Act
Acceptances of member banks
Powers of State banks which become members.
Laws of Washington authorizing national banks
to act as trustee
Loans to cattle raisers, suggestions to banks regarding

692
693
694
696
696
697
659

National-bank notes issued, redeemed, etc., during
year through office of Comptroller of the Currency
667
National banks:
Charters issued to during month
678
Condition of, on June 20, as shown by Comptroller's call
665
Pennsylvania, law passed by legislature of, permitting Stafe institutions to join system
666
Proclamation by President on export embargo
672
Resources and liabilities of Federal Reserve Banks.
722
Review of the month
651-658
State banks:
Admitted to system during month
659
Cooperation of State institutions in New York
with respect to gold control
659
Law passed by Legislature of Pennsylvania permitting State institutions to join system
666
Why a southern State bank has entered the
Federal Reserve System
667,668
Treasury certificates of indebtedness, new issues of.
i

663