Federal Reserve Bulletin December 1925
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FEDERAL RESERVE BULLETIN DECEMBER, 1925 ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON Recent Banking Developments Business Conditions in the United States The New Central Bank of Chile WASHINGTON GOVERNMENT PRINTING OFFICE 1925 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BOARD Ex officio members: D. R. CRISSINGEE, 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. WALTER W. STEWART, Director, Division of Research W. M. IMLAY, Fiscal Agent. and Statistics. J. F. HERSON, E. A. GOLDENWEISER, Assistant Director, Division of Chief, 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. District No. 2 (NEW YORK) PAUL M. WARBURG, President. District No. 3 (PHILADELPHIA) L. L. RUE. District No. 4 (CLEVELAND) GEORGE A. COULTON. District No. 5 (RICHMOND) JOHN M. MILLER, Jr. District No. 6 (ATLANTA) OSCAR WELLS. District No. 7 (CHICAGO) FRANK O. WETMORE. District No. 8 (ST. LOUIS) BRECKINRIDGE JONES. District No. 9 (MINNEAPOLIS) G. H. PRINCE. District No. 10 (KANSAS CITY) > E. F. SWINNEY, Vice President. District No. 11 (DALLAS)-. .-.-—-. W. M. MCGREGOR. District No. 12 (SAN FRANCISCO) __—.-*. HENRY S. MCKEE. II 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. C urtiss - W. P. G. Harding - W. W. Paddock W. Willett. New York Pierre Jay Benj. Strong .._.. J.H. Case L. H. Hendricks.i L.F. Sailer. A. W. Gilbart.i G. L. Harrison J. W Jones.» E. R. Kernel G. E. Chapin.» Ray M. Gidney. L. R. Rounds.* Philadelphia R. L. Austin Geo. W. Norris Wm. H. Hutt C. A. Mcllhenny. W. G. McCreedy.i Cleveland _ E, R, Fanoher M. J. Fleming J. C. Nevm. Frank J. Zurlinden Richmond Wm. W. Hoxton George J. Seay . C. A. Peple Geo. H. Keesee. R. H. Broaddus JohnS. Waldenjr.* Atlanta Oscar Newton M.B. Wellborn J. L Campbell M. W. Bell. Chicago Wm A. Heath J. B. McDougal C. R. McKay W. C. Bachman.1 John H. Blair K. C. Childs.* J. H. Dillard.» D. A. Jones.* 0. J. Netterstrom.1 St. Louis Wm. McC. Martin D.C. Biggs 0. M. Attebery J. W. White. Minneapolis John R. Mitchell R. A. Young.. W. B. Geery— Gray Warren. B. V. Moore Frank C. Dunlop.1 Harry Yaeger * Kansas City M. L. McClure W.J. Bailey C. A. Worthington J. W.Helm. Dallas. C. C. Walsh Lynn P. Talley R. R. Gilbert Fred Harris. San Francisco John Perrin J. U. Calkins Wm. A. Day W. N. Ambrose. IrL.a CCler. Pontiouk s 1 Controller. > 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. Cleveland: Kansas City: Cincinnati branch.... L. W. Manning. Omaha branch L. H. Earhart. Pittsburgh branch Geo. DeCamp. Denver branch J. E. Olson. Richmond: Oklahoma City branch C. E. Daniel. Baltimore branch A. H. Dudley. Dallas: Atlanta: El Paso branch M. Cramp. 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 Chicago: Salt Lake City branch W. L. Partner. Detroit branch W. R. Cation. Seattle branch C. R. Shaw. St. Louis: Spokane branch Louisville branch W. P. Kincheloe. Memphis branch V. S. Fuqua Little Rock branch A. F. Bailey. SUBSCRIPTION PRICE OP BULLETIN THE FEDERAL 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 The month: Page Review of the month—Recent banking developments 839 Business conditions in the United States 846 Foreign debt funding agreements 843 New Central Bank of Chile.__ 890 Earnings and expenses of member banks 869 Volume and distribution of bankers' acceptances 874 Commodity classification of acceptances 877 Member bank borrowings from Federal reserve banks, by class of borrowing banks 878 Official: Rulings of the Federal Reserve Board—Date of termination of membership of State bank vol- untarily withdrawing from Federal reserve system 882 Changes in State bank membership 882 Changes in national bank membership 883 Fiduciary powers granted to national banks 883 Business statistics for the United States: Industrial activity 884 Commodity movements 887 Wholesale and retail trade 888 Estimate of crop production 883 Foreign banking and business conditions: Financial statistics for principal foreign countries 892 Foreign trade of principal countries 895 Industrial statistics for England, France, Germany, and Canada 896 Price movements in principal countries— Federal Reserve Board wholesale price indexes 899 Wholesale prices in principal countries 900 Retail prices and cost of living in principal countries 902 Banking and financial statistics: Federal reserve banks— Condition of Federal reserve banks _ 903 Federal reserve note account 907 Holdings of earning assets 908 Discount and open-market operations of Federal reserve banks 909 Gold settlement fund 918 Discount rates of Federal reserve banks 918 Member banks— Condition of reporting member banks in leading cities.- 910 Banker's balances at reporting member banks in Federal reserve bank cities 911 Deposits of all member banks 912 All member banks—Abstract of condition reports on September 28, 1925 913 Bank debits - 919 Member banks and nonmember banks on par list and not on par list 920 Money rates in principal cities 921 Money in circulation 920 Gold and silver imports and exports 922 Foreign exchange rates 923 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BULLETIN VOL. 11 DECEMBER, 1925 No. 12 REVIEW OF THE MONTH FEDERAL RESERVE BANKS Reflecting chiefly the larger currency and [In millions of dollars] credit requirements of the autumn, demand November, November, Change for credit at the Federal reserve 19241 1925 1 Increased vol- b k increased in recent an s Total bills and securities 1,076 1,291 +215 f baMk months and a fur credit ° > *er growth Discounts 227 598 +371 Acceptances 260 352 +92 in member bank credit brought United States securities 586 332 —254 the outstanding volume in the middle of No- Allother 3 9 +6 vember to thehighestlevel on record. Elements i Average for four report dates. in the recent growth in volume of bank credit have been the seasonal increase in commercial Discounts for member banks increased by demand for credit to finance the marketing of $370,000,000 for the year and holdings of pur- crops and the autumn trade, and the continued chased acceptances by $90,000,000, with the increase in the volume of loans on securities. consequence that total bills and securities The larger demand for funds to meet increased were $215,000,000 larger, notwithstanding the currency and credit requirements has been re- reduction of $255,000,000 in United States flected in a rise of money rates in the open mar- securities from their high level of the autumn ket and in a rapid increase in borrowings at the of 1924. Acceptance holdings of the reserve reserve banks. In November discount rates at banks had declined to a low figure in the sum- the Federal reserve banks of Boston, Cleveland, mer of 1924, when low money rates and the Philadelphia, and San Francisco were ad- abundance of loanable funds resulted in an vanced from 3 y% to 4 per cent. active demand for bills by banks and other The volume of reserve bank credit out- investors. In the autumn of last year, how- standing in November was larger by about ever, the seasonal demand for reserve bank $215,000,000 than at the same credit was met to a considerable extent Position of re- through the sale of acceptances to the reserve serve banks. season a year earlier. Among the principal influences r a us- banks, and at the end of the year acceptance ing this growth in reserve bank credit during holdings of these banks had increased to the year were net withdrawal of more than $400,000,000. In 1925, with higher money $100,000,000 of gold for export, an increase in rates, acceptance holdings of the reserve the volume of money in circulation, and a banks, though declining during the first six growth in member bank reserve requirements, months, were continuously above $200,000,000, arising out of a growth in their deposits and and by the middle of November their volume reflected in an increase of about $80,000,000 had risen above the level of the same period in the deposits of the reserve banks.