The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1910-07-24

VA IN ~vltAtL4E f-A40 ndLlOnai banks
under the call OF June 60, last That the
exhibit was disappointing IS putting the
case mildly, for both the preliminary
reports f.om the Comptroller's office,
and the reports Of local bank officers.
led TO the belief that the banks had ma
terisIly strengthened their position in
recent weeks from the UnfavorabIe con
diti0ns disclosed under the call Of March
=. last such, unfortunately, is not the
case During the interval, loans have
contracted but $l,934, 0J7, while deposit
liabilities have increased 81, 3S4, 75s. and
both have been accomplished with a loss
Of $14l22,6 s4 in specie and legal tender
holdings But the report is startling
when compared with that giving the
condition Of the national banks on.June
., 1903. It discIoses an increase during
the var Of S59f,z75.070 IN loans. and OF
SIS. %. 516 in deposit Liabilities, with
loss IN specie and legal tender Of S65. -
182S79. SUperimposed upon a total re-
serve today Of $50. 772.Ss2, the national
banks Of the country report outstanding
deposit liabilities Of S5.zS7,216.312 and
loans f S5.s54I59, IS6- The percentage Of
actual reserve 20 deposits IN the 5Untry
Is but 21-22 compared with Ills OF March
q. an improvement Of but 90 Pc cent.
What the interior banks have done,
which was taken for Improvement
has been 10 draw down their balances
with their correspondents in New
York and other central reserve cities
10 the extent Of 83.1O2,966, this being
the amOs-lL Of the item due from
banks" iu the ComptroIler's report
Their great volume OF loans, how
ever. show no contraction. and in
fact. taking the interior banks as an
entirety, loans have expanded The
central reserve cities. New York Chi
cago, and St Louis. show ? combined
loan contraction Of about $4,000. 0OO
W lille the interior institutions have
increased S54.22S.722 This showing
Of course, makes the problem Of the
pregnant interest. II is quite true
that general business is CONTRACTING
but an inspection Of bank exchanges
throughout the country shows that
this Curtoilmeut is largely the result
OF the heavy falling on In New York
and that the Central Western. and
creased rather than diminished bank
ClearanCes over last year at the pres
ent time For instance, Dun's Review
this week reports that outside Of New
York practically every city in the
country, notably Philadelphia. Ralti-
more. Cleveland, Minneapolis St
Louis Kansas City. New Orleans, and
san Francisco, shows satisfactory in
Creases over last years business. and
II may be said that gross railway
earnings show by their increases in
recent months and weeks that. de-
spite some contraction here and
there trade as whole is still active
throughout ghe country
The Harvest Demand.
Whether the business Of the interior
VIII slow down sufficiently before the
demand for money for crop moving
purposes reaches its maximum IS the
determining factor r. the autumn
money market On the surface how
ever, II looks as though the reserve
and central reserve banking points
viii have 10 meet a heavy demand
for funds. for, on the one hand IS the
loan expansion Of nearly S4OO-6O0.OeO
accomplished within a year on falling
reserves Of S55.0OO.GO0, and. on the
other, IS the fairly vel sustained
volume Of interior business If all
the pleas for banking conservatism
which have been made since the over
imitation Of loans was pointed out IN
March last have gone practically IN
needed. what may be the position OF
the interior as 20 the character of
the Ioaus2 Il has been repeatedly
said of late that a very heavy pro
portion Of such loan increase has re
suited from extravaganza, automo-
bile purchases, and the Ike. and that
a still heavier proportion is the out
come OF extensive speculation in real
estate, and purchases Of farm lands
at inflated values So II is the char
acter Of the loans which becomes
determining factor, for If they are
based upon real estate operations
they can not be Uquidated readily.
There may be. however. some COM
penSaCOu for this. for II brought face
10 face wiSl q tense situation the farm
ers who have held cCuuOdi rieS back
from the market VIII be compelled to
sell and in fact the reco1d breaking re-
CetDts o. wheat at Chicago during the
the part OF interior banks TO force long
withheld commodities out OF loans This
IS a quite natural reflection Of the re-
cent advance in wheat and corn, and
also possibly Of the difficulty which
Western banks are now experiencing in
rediscountinC DaDer. and IN obtaining
loans While time money showed an
easier tone during the week the best
four 20 siE-mOuthS' commercial paper
IN the market was quoted at from So to
5Ss per cent. with to 81 per cent for
paper Of high class. though not so well
known 1rTnS- OF course the money
market future IS still very much CIordeI
During the week the committee Of Eng
lish bankers. appointed to inquire into
last season : StuDendous frauds. adopted
a resolution to accept no American cot /
ton blilS which were not guaranteed by /
bankers mere. This puts the case d.
TectiN up 70 the American bankers. rail-
waTS- and cotton shippers. and the mat
ter is now so seriOGs that il must be ad-