Federal Reserve Bulletin December 1926
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FEDERAL RESERVE BULLETIN DECEMBER, 1926 ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON Recent Course of Reserve Bank Credit Business Conditions in the United States Condition of All Banks in the United States (This number contains the annual index) WASHINGTON GOVERNMENT PRINTING OFFICE 1926 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BOARD Ex officio members: D. R. CRISSINGER, Governor. EDMUND PLATT, Vice Governor A. W. MELLON, Secretary of the Treasury, Chairman. ADOLPH C. MILLER. CHARLES S. HAMLIN. J. W. MCINTOSH, GEORGE R. JAMES. Comptroller of the Currency. EDWARD H. CUNNINGHAM. WALTER L. EDDY, Secretary. WALTER WYATT, General Counsel. J. C NOELL, Assistant Secretary. Director, Division of Research and E. M. MCCLELLAND, Assistant Secretary. Statistics. W. M. IMLAY, Fiscal Agent. J. F. HERSON, E. A. GOLDENWEISER, Acting Director, Division of Chief J Division of Examination, and Chief Federal Research and Statistics. Reserve Examiner. E. L. SMEAD, Chief, Division of Bank Operations. FEDERAL ADVISORY COUNCIL District No. 1 (BOSTON) ._ CHAS. A. MORSS, Vice President. District No. 2 (NEW YORK) , JAMES S. ALEXANDER. District No. 3 (PHILADELPHIA) __ L. L. RUE. District No. 4 (CLEVELAND) __. _ GEORGE A. COULTON. District No. 5 (RICHMOND) JOHN F. BRUTON. District No. 6 (ATLANTA) _ P. D. HOUSTON. District No. 7 (CHICAGO) ____ FRANK O. WETMORE, President. District No. 8 (ST. LOUIS) :__ _ BRECKINRIDGE JONES. District No. 9 (MINNEAPOLIS) __.- THEODORE WOLD. District No. 10 (KANSAS CITY) P. W. GOEBEL. District NO. 11 (DALLAS) :_ B. A. MCKINNEY. District No. 12 (SAN FRANCISCO) HENRY S. MCKEE. n Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis OFFICERS OF FEDERAL RESERVE BANKS Federal Reserve Bank of- Chairman Governor Deputy governor Cashier Boston . Frederic H. Curtiss..... W. P. G. Harding- W. W. Paddock.... W. Willett. Pierre Jay Benj. Strong ... J. H. Case L. H. Hendricks.* New York. L. F. Sailer A. W. GilbarU G. L. Harrison.:.—. J. W. Jones.* E. R. Kenzel Ray M. Gidney.* L. R. Rounds.* Philadelphia.. R. L. Austin...... Geo, W. Norris.. Wm. H. Hutt C. A. Mcllhenny. W. G. McCreedy.s Cleveland.... George DeCamp.. E.'R. Fancher.. M. J. Fleming H. F. Strater. Frank J. Zurlinden. Richmond Wm. W. Hoxton.. George J. Seay.. C. A. Peple Geo. H. Keesee. R. H. Broaddus John S. Walden, jr.* Atlanta.. Oscar Newton.... M. B. Wellborn. Creed Taylor....... M. W.Bell. Wm. A. Heath.... J. B. McDougal. C. R. McKay W. C. Bachman.i Chicago JohnH. Blair K. C. Childs.1 J. H. Dillard.t D. A. Jones.* O. J. Netterstrom.* St, Louis Wm. McC. Martin. D. O. Biggs O. M. Attebery-.... J. W. White. JohnR. Mitchell... W. B. Geery Gray Warren. Minneapolis. R. A. Young.... B. V. Moore Frank C. Dunlop.* Harry Yaeger * . Kansas City.. M. L. McClure—- W. J. Bailey... C. A. Worthington.. J. W. Helm. Dallas.. O. O. Walsh Lynn P. Talley. R. R. Gilbert Fred Harris. R. B. Coleman...—. San Francisco ..... Isaac B. Newton J. U. Calkins Wm. A. Day.. W. N. Ambrose. Ira Clerk L. C. Pontious 1 Controller. 2 Assistant deputy governor. MANAGING DIRECTORS OF BRANCHES OF FEDERAL RESERVE BANKS Federal Reserve Bank of— Managing director Federal Reserve Bank of— Managing director New York: Minneapolis: Buffalo branch W. W. Schneckenburger. Helena branch R. E. Towle. Kansas City: Cincinnati branch.— C. F. McCombs. Omaha branch— L. H. Earhart. Pittsburgh branch J. C. Nevin. Denver branch... J. E. Olson. Richmond: Oklahoma City branch. C. E. Daniel. Baltimore branch .... A.H.Dudley. Dallas: Atlanta: El Paso branch M. Crump. New Orleans branch Marcus Walker. Houston branch _ D. P. Reordan. Jacksonville branch ..... Geo. R. DeSaussure. San Francisco: Birmingham branch A. E. Walker. Los Angeles branch R. B. Motherwell. Nashville branch J. B. Fort, jr. Portland branch R. B. West. Chicago: Salt Lake City branch..- * W. L. Partner. Detroit branch „._ W. R. Cation. Seattle branch C. R. Shaw. St. Louis: Spokane branch.. _ D.L.Davis. Louisville branch—.. —. W. P. Kineheloe. Memphis branch ._ W. H. Glasgow. Little Rock branch A. F. Bailey. SUBSCRIPTION PRICE OP BULLETIN THE FEDEKAL RESERVE BULLETIN is the board's medium of communication with member banks of the Federal reserve system and is the only official organ or periodical publication of the board. It contains, in addition to the regular official announcements, the national review of business conditions, detailed analyses of business conditions, research studies, reviews of foreign banking, and complete statistics showing the condition of Federal reserve banks and member banks. The BULLETIN will be sent to all member banks without charge. To others the subscription price, which covers the cost of paper and printing, is $2. Single copies will be sold at 20 cents Outside of the United States, Canada, Mexico, and the insular possessions, $2.60; single copies, 25 cents. in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis TABLE OF CONTENTS Theononth: Page Review of the month—Recent course of reserve bank credit _ _ 823 Business conditions in the United States ;__ .__ 827 Restoration of the Belgian currency _.___ .______. 842 Condition of all banks in the United States.. _ _ _ _ 846 Official: Rulings of the Federal Reserve Board: Eligibility of notes secured by adjusted service certificates for use as collateral security for Federal reserve notes. ___ _ ^ _ . __. 854 Cottonseed oil as an agricultural product _ ... __ 854 Acceptance by national banks against import and export bills 854 Changes in State bank membership _ , _ _.___ 856 Changes in national bank membership . _ _ 856 Fiduciary powers granted to national banks - 856 Business statistics for the United States: Industrial activity P . _ _ 857 Commodity movements.. > _ _ _ 859 Wholesale and retail trade.— 860 Estimates of crop production... : ___. 855 Foreign banking and business conditions: Financial statistics for foreign countries 862 Condition of central banks 862 Condition of commercial banks. .__ 864 Discount rates of central banks 864 Money rates in foreign countries. ___ 865 Gold movements- .. 867 Silver movements. ,__ 868 Foreign exchange rates. , 866 Price movements in principal countries—- . •. • Wholesale prices in principal countries _. 869 Retail prices and cost of living in principal countries — 871 Industrial statistics for England, France, Germany, and Canada . 872 Banking and financial statistics: Federal reserve banks— Condition of Federal reserve banks .___ 874 Federal reserve note account. 878 Holdings of bills and securities and earnings thereon .__ 879 Discount and open-market operations 880 Gold settlement fund. _.. 890 Discount rates of Federal reserve banks____ 890 Member banks— Reporting member banks- Condition of reporting banks in leading cities. ; __._ 881 Condition of reporting banks in Federal reserve bank cities _. 883 All member banks— Deposits, by size of city...-- . .. 885 All banks in the United States—Condition on June 30, 1926__ _______ 846 Bank debits __-_ 888 Member banks and nonmember banks on par list and not on par list. _; 889 Money in circulation ;_._.- , . 889 Money rates in principal cities . .__ . 886 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BULLETIN VOL. 12 DECEMBER, 1926 No. 12 REVIEW OF THE MONTH the total of net demand and time deposits, the two classes of deposits for which reserves are Demand for reserve bank credit showed little required by law, reflects a growth of about change in November and the average volume $775,000,000 in time deposits, against which a outstanding was at about the 3 per cent reserve is required, and a decrease Reduced vol- same ievei as during the pre- of about $150,000,000 in net demand deposits, lime of reserve- ceding month. This absence bank credit against which reserve requirements range from of growth in reserve bank credit 7 to 13 per cent, depending on the class of during the period of seasonal increase in the city in which the banks are located. The demand for currency is in contrast with the increase in the autumn of 1925, with the con- M1UJGNS 0? DOLLARS 'MILLIONS' OF DOLLARS 1500 1500 sequence that the volume of reserve bank VOLUME OF RESERVE BANK CREDIT credit, which during the larger part of this year was considerably above last year's level, was smaller in November than a year ago, as is indicated by the chart. The lower level of reserve bank credit than a year ago is shown, notwithstanding an increase in the demand for currency and a growth of more than $600,000,000 in deposits of member banks. Factors accounting for the reduced demand for reserve bank credit during a year of growth in the demand for currency and for bank credit have been the importation of gold from abroad •vJSQO in sufficient volume to enable member banks to Jan. Feb. Mar. Apr. May June July" Aii§. Sept. Oct. Nov. Dec. meet the demand for additional currency, and Figures are monthly averages of daily holdings of bills and securities by the 12 Federal reserve banks. Latest figure is the average for first 2Z changes in the composition of member bank days in November deposits sufficient to enable them to increase their deposit liabilities considerably and at the growth in time deposits has been more rapid same time to reduce somewhat their reserve for a number of years than the growth in balances at the reserve banks. demand deposits. When the composition of Changes in the composition of member net demand and time deposits combined in bank deposits that have reduced the amount the spring of 1922 is compared with the com- of reserves required for a given position at the present time, it appears that Changes in volume of deposits have been four years ago time deposits constituted 31 composition of per cent of the total, compared with 38 per deposits the rapid growth of time de- posits, throughout the country cent now.