The independent. [volume] (Lincoln, Neb.) 1902-1907, 1905-02-16

cisco and Washington, shall at all
times have on hand, in lawful money
Of the United States, an amount equal
TO at least twenty-five per centum OF
the aggregate amount OF its notes In
circulation and its deposits; and every
other association shall at all times
have on hand, In lawful money OF the
United States, an amount equal to at
least fifteen per centum of the aggre-
gate amount of it's notes In circulation,
and of it's deposits" And it forbids
banks to make loans or discounts
whenever their lawful money falls
below such required reserves.
This is mandatory, requiring 25 per
cent in lawful money to be kept on
hand by banks in designated large
cities, and Is per cent In lawful money
by all others.
Had reserves been regulated solely
thereby. the existing monetary dis
elimination could never have grown.
Section 5192 provides that Three
fifths Of the reserve of fifteen per
centum required by the preceding sec
ton to be kept, may consist OF bal
ances due to an association, available
for the redemption of it's circulating
notes. from associations approved BY
the comptroller of the currency, or
ganized under the act Of June 8, 1854,
or under this title, and doing business
in the cities Of Albany, Baltimore, B0s-
ton, Charleston, Chicago, Cincinnati,
Cleveland, Detroit, Louisville MilWau-
kee. New Orleans, New York, Phila-
delphia, Pittsburg, Richmond, St.
Louis, San Francisco, and Washing
ton"
This permits three-fifths OF all 10
per cent reserves to be kept as deposits
or balances" in national banks, IN
designated or approved reserve cities,
/ which now number thirty-eight, aS
follows: New York, Chicago, St. Louis,
Boston, Albany, *Brooklyn, Philadel-
phia. Pittsburg, Baltimore, Washing
ton, d. G., Savannah, New Orleans,
louisville, *Houston, Cincinnati,
|Cleyeland. sColumbus, indianapolis,
Detroit, Milwaukee, *Des Mpines, st.
|paul. minneapolis, AKansas City,.
Kan. *Kansas City, Mo-, *St. Joseph,
III lincoln, +Omaha, +Denver, San Fran
cisco. %Los Angeles, +Portland, Ore,
*Dallas. *Ft. Worth, *Cedar Rapids,
sDubuque, +Wichita, and *Salt Lake
City.
Those marked with an asterisk were
designated under act Of March 3, 1887,
or March 3. 1903.
Section 5195 pr0vides as follows:
Each association organized in any of
t the cities named in section fifty-One
! hundred and ninety-one may keep one
Ihalf of it's lawful money reserve IN
!. cash deposits in the city Of New YORK..
: This now permits one-half OF all 70
/ per cent reserves of banks In the last
> thirty-five mentioned cities to be kept
as deposits in national lanks in the
5 first three mentioned, namely: New
t York. Chicago or st. Louis, instead OI
New York only.
4 Nv act of June 20, 1874, banks are
) not now required to keep 15 per cent
s and 25 per cent reserves against tnelr
D respective circulations, but, instead,
0 must at all times keep per cent o.
: amount Of same on deposit IN tne
: United States treasury, as a redemp.
tion fund. (which sum shall be counted
Q as part Of their lawful reserves
!. against deposits.
4 The total of such redemption funos
i was on March 2S, 1904, $19,O73,lOO.
' By act, March 3, 1887, amended Y!
d act. March 3, 1903, whenever three
r fourths of the banks located tnerell
! shall make application, any city 9
25 900 population may be designated
" reserve city; and any city OF 10000
y population may be designated centra
= reserve city, like the city OF Ne'
X .ork;o and thereafter banks in q
A. such cities must have on hand
a. lawful money rs per cent Of their q
IL posits. Only Chicago and st. Lou
ID banks have availed to become centr
al reserve cities.
From the above summary the 1olloN
o. ing. considerations are apparent:
in First: The mandatory recurrence
&c Of section 5191, renewed in acts, Mar
99 8, 1887, and March 8, 1903, that !
,ts serves of 25 percent and 10 per sc
nd shall consist of lawful money on han
is in practice nullified by the perml
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