FEDERAL RESERVE BULLETIN JULY 1934 ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON Recent Banking Legislation Annual Report of the Netherlands Bank UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON: 1934 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BOARD Ex officio members: EUGENE R. BLACK, Governor. HENRY MORGENTHAU, Jr., CHARLES S. HAMLIN. Secretary of the Treasury, Chairman, ADOLPH C. MILLER. GEORGE R. JAMES. J. F. T. O'CONNOR, J. J. THOMAS. Comptroller of the Currency. M. S. SZYMCZAK. H. WARNER MARTIN, Assistant to the Governor. E. A. GOLDENWEISER, Directort Division of Research CHESTER MORRILL, Secretary. and Statistics. J. C. NOELL, Assistant Secretary. CARL E. PARRY, Assistant Director, Division[of Research L. P. BETHEA, Assistant Secretary. and Statistics. S. R. CARPENTER, Assistant Secretary. E. L. SMEAD, Chief, Division of Bank Operations. WALTER WYATT, General Counsel. J. R. VAN FOSSEN, Assistant Chief, Division of Bank GEORGE B. VEST, Assistant Counsel. Operations. LEO H. PAULGER, Chief, Division of Examinations. O. E. FOULK, Fiscal Agent. FRANK J. DRINNEN, Federal Reserve Examiner. JOSEPHINE E. LALLY, Deputy Fiscal Agent. FEDERAL ADVISORY COUNCIL District no. 1 (BOSTON) THOMAS M. STEELE. District no. 2 (NEW YORK) WALTER E. FREW. District no. 3 (PHILADELPHIA) HOWARD A. LOEB, Vice President. District no. 4 (CLEVELAND) H. C. MCELDOWNEY. District no. 5 (RICHMOND) HOWARD BRUCE. District no. 6 (ATLANTA) H. LANE YOUNG. District no. 7 (CHICAGO) SOLOMON A. SMITH. District no. 8 (ST. LOUIS) WALTER W. SMITH, President. District no. 9 (MINNEAPOLIS) THEODORE WOLD. District no. 10 (KANSAS CITY) W. T. KEMPER. District no. 11 (DALLAS) JOSEPH H. FROST, District no. 12 (SAN FRANCISCO) M. A. ARNOLD. WALTER LICHTENSTEIN, Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis OFFICERS OF FEDERAL RESERVE BANKS Federal Reserve Bank Deputy governor Cashier of- Chairman Governor Boston F. H. Curtiss R. A. Young _ W. W. Paddock W. WTillett. New York J. H. Case G. L. Harrison W. R. Burgess C. H. Coe.1 J. E. Crane J. W. Jones.i W. S. Logan W. B. Matteson.i L. R. Rounds J. M. Rice.i L.F. Sailer Allan Sproul.* R. M. Gidney. L. W. Knoke.i Philadelphia __ R. L. Austin _ G. W. Norris W. H. Hutt C. A. Mcllhenny. ~W T TlaT7i« 1 C. A. Mcllhenny L. E. Donaldson.i W. G. McCreedy.» Cleveland _ L. B. Williams E. R. Fancher M. J. Fleming H. F. Strater. Richmond. W. W. Hoxton -.. G. J. Seay C. A. Peple G. H. Keesee. R. H. Broaddus J. S. Walden, Jr.» Atlanta O^car Newton W. S. Johns « . H. F. Connifl M. W. Bell. W. S. McLarin, Jr.i Chicago _. E. M. Stevens G J. Schaller C. R. McKay W. H. Snyder.« H. P. Preston W. 0. Bachman.i J. H. Dillard 0. J. Netterstrom.i A. T. Sihier.i E. A. Delaney.1 A. L. Olson.* St. Louis J. S. Wood W. McC. Martin 0. M. Attebery _ S. F. Gilmore.1 J. G. McConkey A. H. Haill.i F. N. Hall.i G. 0. Hollocher.1 0. C. PhiUips.J Minneapolis J. N. Peyton W. B. Geery Harry Yaeger. _ H. I. Ziemer. 8 TT T 7ipmpr F. 0. Dunlop. Kansas City M. L. McClure G. H. Hamilton C. A. Worthington J. W. Helm. T W TTOITTI Dallas C.C.Walsh _ B. A. McKinney R.R.Gilbert Fred Harris. R. B. Coleman W. 0. Ford.i San Francisco J U Calkins W A Day W M Hale Ira Clerk _ 1 Assistant deputy governor. « Controller. « Acting governor. • Assistant to the 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... R. M. O'Hara. Helena branch R. E. Towle. : Cleveland: Kansas City: Cincinnati branch C. F. McCombs. Omaha branch L. H. Earhart. Pittsburgh branch J. C. Nevin. Denver branch J. E. Olson. i Richmond: Oklahoma City branch.. C. E. Daniel. Baltimore branch Hugh Leach. Dallas: Charlotte branch W. T. Clements. El Paso branch.- J. L. Hermann. i Atlanta: Houston branch W. D. Gentry. New Orleans branch... Marcus Walker. San Antonio branch M. Crump. Jacksonville branch Hugh Foster. San Francisco: Birmingham branch.__ J. H. Frye. Los Angeles branch W. N. Ambrose. Nashville branch J. B. Fort, Jr. Portland branch R. B. West. Chicago: Salt Lake City branch.. W. L. Partner. i Detroit branch R. H. Buss Seattle branch C. R. Shaw. St. Louis: Spokane branch D. L Davis. Louisville branch _ J. T. Moore. Memphis branch W. H. Glasgow. Little Rock branch A. F. Bailey. SUBSCRIPTION PRICE OF 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. 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 Page Review of the month—Recent banking legislation 429 Act relating to direct loans for industrial purposes 430 Silver Purchase Act of 1934 435 Annual report of the Netherlands Bank 463 Cuban currency legislation 468 National summary of business conditions 447 Financial, industrial, and commercial statistics: Reserve bank credit, gold stock, money in circulation, etc 448-451 Member and nonmember bank credit: All banks in the United States 454 All member banks 452, 453, 496, 497 Weekly reporting member banks in leading cities 455, 498 Brokers' loans 455 Acceptances and commercial paper 456 Discount rates and money rates 457 Treasury finance 458 Reconstruction Finance Corporation—Loans, subscriptions, and allocations 459 Security prices, bond yields, and security issues 460 Production, employment, car loadings, and commodity prices 461, 500-504 Merchandise exports and imports 462 Department stores—Indexes of sales and stocks 462 Freight-car loadings, by classes 462 Financial statistics for foreign countries: Gold reserves of central banks and governments 472 Gold production 473 Gold movements 473-475 Government note issues and reserves 476 Bank for International Settlements 476 Central banks 477-479 Commercial banks 480 Discount rates of central banks 481 Money rates 481 Foreign exchange rates 482 Price movements: Wholesale prices 483 Retail food prices and cost of living 484 Security prices 484 Law department: Rulings of the Federal Reserve Board: Discounts for individuals, partnerships, and corporations 485 Permits to member banks relating to participation in underwriting and dealing in municipal and other securities 485 Securities company within provisions of sections 20 and 32 of Banking Act of 1933 485 Membership in Federal Reserve System of trust companies doing substantially no banking business 486 Act extending for 1 year the temporary plan for deposit insurance, etc ' 486 Act amending Federal Reserve Act relative to loans made by national banks secured by real estate-- 488 Regulation S—Discounts, purchases, loans, and commitments by Federal Reserve banks to provide working capital for established industrial or commercial businesses 488 Federal Reserve statistics by districts, etc.: Banking and financial statistics 493-499 Industrial and commercial statistics 500-505 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BULLETIN VOL. 20 JULY 1934 No. 7 REVIEW OF THE MONTH with the chairmen and governors of the 12 In the field of currency and banking the most Federal Reserve banks and has been approved important developments in June related to new by that conference. Federal legislation, including an act to provide "The need for this character of loans has for loans by Federal Reserve banks and by the become increasingly apparent in recent months. Reconstruction Finance Corporation to in- Many small industrial establishments have dustrial and commercial enterprises, the Silver suffered severe capital losses during the depres- Purchase Act of 1934, an act providing for the sion and are now short of working capital. A extension for a year of the temporary plan for survey made by the Federal Reserve Board deposit insurance, the National Housing Act, through the Reserve banks and the chambers and the Securities Exchange Act of 1934. of commerce showed that this condition is The text of the Securities Exchange Act of widespread and is not being met by existing 1934 appeared in the BULLETIN for June, and facilities. Small industries find it difficult at the other acts and important documents relat- present to obtain their requirements of working ing to them are printed in this issue, with the capital through the capital market, while com- exception of the National Housing Act with mercial banks and other financial institutions, respect to which only one section that amends in many cases, are hesitant about undertaking the Federal Reserve Act is reproduced. on their single responsibility the risks involved By an act of Congress approved by the in making relatively long-time loans for work- President on June 19, 1934, the Federal Reserve ing capital purposes. Loans to banks were authorized to make "Recognizing the need of these industrial and comme^ ^ans to supply working capital commercial businesses for additional working enterprises to industrial and commercial capital to enable them to continue or resume enterprises within the prescribed limitations. normal operations and to maintain employment The text of this act is printed below and regu- or provide additional employment, Congress lations issued by the Board under the law are has granted the Federal Reserve banks broad printed on pages 430-434.