FEDERAL RESERVE BULLETIN ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON MAY, 1918 WASHINGTON GOVERNMENT PRINTING OFFICE 1918 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BOARD. EX OFFICIO MEMBERS. W. P. G. HARDING, Governor. PAUL M. WARBURG, Vice Governor. WILLIAM G. MOADOO, FREDERIC A. DELANO, Secretary of the Treasury, ADOLPH 0. MILLER. Chairman. CHARLES 3. HAMLIN. JOHN SKELTON WILLIAMS, Comptroller of the Currency. H. PARKER WILLIS, Secretary, L. 0. ADELSON, Assistant Secretary. I. 0. ELLIOTT, Counsel. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 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 ?xnnum. Single copies will be sold at 20 cents* Foreign postage should be added when it will be required, Remittances should be made to the Federal Reserve Board, Member banks desiring to have the Bulletin supplied to their officers and directors may have it sent to not less than ten names at a subscription price of $1 per annum. No complete sets of the Bulletin for 1915 or 1916 are available. Bound copies of the Bulletin for 1917 may be had at $5 per copy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis TABLE OF CONTENTS. .!r'y.g>3. Review of the month 359 Directors named for the El Paso and Salt Lake City branch banks 365 Assistant secretary of Federal Reserve Board appointed 365 Press statement issued by the War Trade Board 385 New issue of Treasury certificates of indebtedness 365 Opinion of the Attorney General re collection of checks , 367 .Development of the check clearing and collection system 371 National banks and the Liberty loans 372 Outline of organization of Federal Reserve Banks .373 Chart showing 374 Financial and banking statistics, also exchange rates of neutral countries in Europe, 1914-1917 375 Silver coinage act 395 The United States purchases of silver 39 / Statements issued by the Capital Issues Committee 399 fiduciary powers granted to national banks 402 Banks granted authority to accept up to 100 per cent of capital and surplus 402 Growth of the acceptance business 402 Commercial failures reported 408 Charters issued to national banks during the month 403 Statement by Department of Agriculture regarding storage conditions for perishable products 404 State banks and trust companies admitted to system up to and including April 30 408 Amendments to banking laws as reported by Senate and House committees 414 Informal rulings of the Federal Reserve Board 435 Law department 438 Business conditions throughout the Federal Reserve districts 440 Gold settlement fund transactions 459 Operation of the check clearing and collection system 461 Discount operations of the Federal Reserve Banks 462 Resources and liabilities of the Federal Reserve Banks 408 Federal Reserve note accounts of Federal Reserve Banks and agents 471 Interdistrict movement of Federal Reserve notes 473 Member bank condition statement 474 Earnings on investments of Federal Reserve Banks 480 'Gold imports and exports 481 Discount rates in effect. 482 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BULLETIN VOL. 4 MAY 1, 1918. No. 5 REVIEW OF THE MONTH. Preceding the third Liberty loan, as already explained in previous numbers The third Liberty loan, offered by the Sec- f certm retary of the Treasury at the cat™ ° "of' the Bulletin, has been a O pening of April, closed on series of certificate issues which May 4 with a gross subscrip- have been placed with the banks and whose tion reported to that date of $3,316,628,250. proceeds have been used for the purpose of The original minimum issue having been fixed anticipating the sale of the new bonds, and at $3,000,000,000, it is thus seen that oversub- providing for the needs of the Government scriptions amounted to at least $316,628,250, meanwhile. These certificates have been taken and probably to much more than this sum. up by the banks under the plan announced Organization for the purpose of placing the by the Secretary of the Treasury two months bonds was much more perfect during this loan ago, wherein it was suggested to the banks than during either of its predecessors, and the that they set aside weekly 1 per cent of their absorption of the loan proceeded steadily and resources for a period of 10 weeks. The with increasing success up to the time of closing. aggregate of the certificates thus placed shows It is 3^et too early to give with any degree the amount of the proceeds of the new loan of accuracy the distribution of the loan by which it will be necessary to devote to the districts. Preliminary returns, however, show funding of these outstanding obligations, $400,- that all districts oversubscribed their quotas 000,000 maturing April 22 having already been and that the total number of separate subscrip- redeemed. In the following table are presented tions was in the neighborhood of 17,000,000. consolidated returns for the subscriptions to So great is the number of subscribers that it certificates up to April 22: will probably not be possible to give definite Distribution of Treasury certificates of indebtedness in figures before the middle of May. There has anticipation of the third Liberty loan. Jan. 22 to Feb. 8 to Feb. 27 to been a much wider participation on the part Apr. 22. May 9. May 28. of the public, and the facts indicate that Treasury Department. S3,119,000 $3,389,000 general distribution of future loans may be Boston 520,025.000 I 29,134,000 35,369,000 New York 209,685,000 ! 241,322,000 172,666,500 confidently relied upon. With only a part of . Philadelphia 22,500,000 | 30,000,000 33,000,000 | Cleveland 26,000,000 | 34,000,000 44,500,000 the last day's returns showing, the number of i Richmond 7,000,000 | 12,131,000 18,148,000 I Atlanta 9,507,000 I 12,391,000 14,814,000 subscribers in each Federal Reserve district Chicago 30,359,000 42,352,000 59,168,000 St. Louis 18,090,000 20,064,000 25,709,000 may be fairly indicated as follows: I Minneapolis 10,750,000 15,000,000 17,000,000 New York, 4,000,000; Chicago, 2,498,000; Cleveland, I Kansas City 12,000,000 21,411,000 23,736,500 i Dallas 13,084,000 14,076,000 19,000,000 1,561,979; Philadelphia (estimated), 1,200,000; Boston I San Francisco 21,000,000 25,000,000 33,500,000 (estimated), 3,200,000; San Francisco, 1,000,000; Atlanta, 500,000,000 1,000,000; Minneapolis, 1,000,000; Kansas City (estimated), Total. 400,000,000 500,000,000 900,000: Richmond (estimated), 900,000; St. Louis, Mar. 20 to Apr. 10 to ! Apr. 22 to 866,342: Dallas, 850,000; total, 16,976,321. June 18. July 9. | July 18. Treasury Department S3,828,000 j | 81,559,000 The Secretary of the Treasury, in a state- Boston 53,690,000 j 839,731,000 ! 36,468,000 New York 193,700,500 I 215,448,000 !222,486,000 ment issued on May 6, says: "I earnestly hope Philadelphia 38,000,000 | 38,000,000 ! 35,000,000 Cleveland 48,400,000 i 46,000,000 39,133,500 that everyone who has bought Liberty bonds Richmond 16,234,500 11,219,000 11,097,000 Atlanta 14,557,000 17,095,000 11,209,000 will try to keep them for the period of the war Chicago 64,414,000 65,850,000 I 63,212,000 at least. The slogan now should be 'Keep i St. Louis 22,842,000 21,181,000 25,698,500 7 Minneapolis 16,000,000 15,600,000 15,000,000 your Liberty bond. No one does his share Kansas City 26,116,500 25,000,000 20,260,500 Dallas....." ! 15,000,000 | 16,602,500 13,162,500 fully if he merely buys a bond and then sells SanFraiMiseo ! 30,250,000 j 39,500,000 23,540,500 it immediately below par on the market." Total : 543,032,500 | 551,226,500 517,826,500 359 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 880 FEDERAL RESERVE BULLETIN. MAY 1,1918. For the five-weeks period March 22 to April assets increased from 1,163.3 to 1,286.2 mil- . 26 the Federal Reserve Banks j lions. em l0 s Ol the''Reservii_ £ e® Bazi&s - . repor/ t an aggregat._f.to to. e _increas . _ ._e_ !| During the period under review the hank's' of 332.6 millions in their bill gold reserves increased from 1,802-8 to 1,827.0 holdings, the amount of discounted paper held millions, while their net deposits went up from on the later date showing an increase of 359.1 1,505.8 to 1,556.3 millions, both Government millions. As against this large increase, the deposits and member-bank reserve deposits combined holdings of Government securities, showing larger totals at the later date. Fed- mainly certificates of indebtedness, show a de- eral Reserve notes in circulation increased crease of 208.2 millions.