FEDERAL RESERVE BULLETIN SEPTEMBER, 1926 ISSUED BY THE FEDERAL RESERVE BOARD AT WASHINGTON Bank Credit and Investment Funds Condition of All Member Banks Report of Indian Currency Commission 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. HendricksA New York... L. F. Sailer A. W. Gilbart.i G. L. Harrison J. W. Jones.* V E. R. Kenzel. Ray M. GidneyJ L. R. Rounds.* Philadelphia R.L.Austin Geo. W. Norris... Wm. H. Hutt... — C. A. Mcllhenny. W. G. McCreedy.* 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.. J. L. Campbell .. M. W. Bell. Creed Taylor Chicago..— ._.__._. Wm. A. Heath.... J. B. McDougal.. C. R. McKay....... W. C. Bachman.1 John H. Blair K.O.Childs.i J. H. Dillard.i D. A. Jones.1 O. J. Netterstrom.i St. Louis..... Wm. McC. Martin. D. C. Biggs O. M. Attebery J. W. White, Minneapolis.. John R.Mitchell... W. B. Geery Gray Warren. R. A. Young B.V.Moore Frank 0. Dunlop.1 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. i 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. Cleveland: 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 O.R.Shaw. St. Louis: Spokane branch ... D. L. Davis. Louisville branch W. P. Kincheloe Memphis branch . ;_. W. H. Glasgow. Little Rock branch A. F. Bailey. SUBSCRIPTION PRICE OF BULLETIN THE FEDERAL RESERVE BULLETIN is the board V 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—Bank credit and investment funds _ . _ _ — 623 Business conditions in the United States ____. __: 627 Changes in membership in the Federal reserve system_____ ._ — _ 643 Condition of all member banks on June 30__ _ ____.._ . .__ 644 Report of the Royal Commission on Indian Currency and Finance _ _. _ 657 Official: Rulings of the Federal Reserve Board-— Eligibility for rediscount of notes of cold-storage and warehouse company. _ _ _ 665 Eligibility for rediscount of bankers' acceptances drawn to finance the storage of cottonseed. _ 666 Changes in State bank membership.- ___. 668 Changes in national bank membership _ _. !__ 668 Fiduciary powers granted to national banks _ _ _ 668 Business statistics for the United States: Industrial activity = _ _ 669 Commodity movements 671 Wholesale and retail trade 672 Foreign banking and business conditions: Consolidation of Italian note issue 674 Gold balance sheets of Austrian banks : 676 Financial statistics for principal foreign countries 679 Discount rates of central banks . 681 Foreign trade of principal countries _._ 682 Industrial statistics for England, France, Germany, and Canada _ 683 Price movements in principal countries— Wholesale prices in principal countries . 685 Retail prices and cost of living in principal countries 687 Banking and financial statistics: Federal reserve banks- Condition of Federal reserve banks .__ ___ 688 Federal reserve note account 692 Holdings of bills and securities and earnings thereon. 693 Discount and open-market operations ; _ _ _ _ — 694 Gold settlement fund . 705 Discount rates of Federal reserve banks : 705 Member banks— Reporting member banks— Condition of reporting member banks in leading cities..- •, 695 Condition of reporting banks in Federal reserve bank cities 697 Loans to brokers and dealers .__ 698 All member banks— Condition on June 30 ... Deposits, by size of city ' 698 Bank debits.— ________________________ 699 Member banks and nonmember banks on par list and not on par list 702 Money in circulation ___- 702 Money rates in principal cities- 700 Gold and silver imports and exports.— 703 Foreign exchange rates -__ 704 IV Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis FEDERAL RESERVE BULLETIN VOL. 12 SEPTEMBER, 1926 No. 9 REVIEW OF THE MONTH and the first eight months of 1926 are com- In recent weeks the volume of member bank bined, it appears that loans and investments credit, which has been growing since the early of New York City banks in the middle of 1926 spring, increased further, partly were at about the same level as at the peak crJdOitUmeOfbank in response to the seasonal de- reached after the rapid rise during 1924, while mand for currency and credit the loans and investments of member banks in in connection with the harvesting and mar- other leading cities were about $1,160,000,000 keting of crops. This increase has carried the larger than at the close of 1924. Changes in volume of credit to the level that prevailed at the total volume of loans and investments and, the close of 1925. When the first eight months separately, of security loans, commercial loans, of 1926 are considered as a whole, it appears and investments, for member banks in New that the fluctuations in the volume of member York City and in other leading cities between bank credit have been smaller this year than the end of 1924 and the middle of August, 1926, in other recent years, and that the period has are shown in the following table: been characterized primarily by the continued MEMBER BANKS IN LEADING CITIES large volume of member bank credit outstand- [In millions of dollars! ing. At the reserve banks the volume of credit Increase (+) or de- in use has also shown a recent increase and crease (—) be- tween Dec. 31, throughout the past eight months has been at 1924, and Aug. 18, a level about $100,000,000 above that pre- 1926 vailing a year ago. This larger use of member New Other York leading bank and reserve bank credit has been reflected City cities in the money market in a level of interest rates continuously above that in 1925. Total loans and investments -75 +1,161 Security loans.._ .._ +42 +699 The growth of member bank credit since last All other loans _ __ -31 +287 spring has been general throughout the country, Investments _. _ __ -86 +175 and occurred at member banks Ne^YoTk^City in New York City as well as at For the period of about 20 months taken as and outside those outside of the financial a whole, there has been relatively little change center. When the entire period in the different classes of loans and investments from the close of 1925 is considered, however, of member banks in New York City.