The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-06-27
PROVISION IS MADE
FORRET|REMENT Of
BANK CIRCULATION
Bankers Get Part Of What
They Ask But Fail
on Others
PERSONNEL OF FEDERAL.
RESERVE BOARD SAME
Administration Stands Firm
Against Bankers on Power
OF Appointment--Change
in Regard to Reserves

WASHINGTON. June 2s.-The adj
Ininistration currency bill was intro
duced in the house and senate today.
As the bill finally appeared. when
laid before congress, 1t contains the
three sections which are stricken out
of the original draft. and which pro-
vides for the gradual retiremen. of
the national bank circulation. and
the refunding of the 3 per cent
United States bonds. and the suhsti-
tuition therefor of per cent. without
the circulating privilege.
This Ia the most important change
that has been made in the bill. and
1t represents considerable conces-
sion to the bankers
They also obtained another inpor-
tant concession in regard TO the
power of the federal reserve associa-
ton TO fix the rate of discount for
the federal reserve banks This has
been changed so that the reserve
banks themselves now have the pow
er of fixing minimum rate OF dis
count subject to review by the fed
eral reserve board.
Amount of Reserves.
There has been also q change IN
regard to the reserves TO be main
tanned by the country banks.
While the amount OF reserve for
country banks remain the Same. the
following proviso has been added TO
the section:
Provided that the federal reserve
board may in Its discretion permit
said remainder OF Is per cent re-
serve required of country banks to
consist Of balances on deposit. with
any bank in a reserve or central re-
serve city. as defined by law"
In regard to the power OF the pres
ident over the federal reserve board.
Mr. Wilson and his advisers have.
however. yielded nothing. Tho board
still consists OF seven members. all of
whom are TO be appointed either d.
rectly or indirectly by the president.
Furthermore. the presidents power
over the board has been strengthened
by slight changes that have been
made In several sections OF the
measure.
Issuance OF Notes.
Under the sections of the bill
which have been restored the gov
ernment Is authorized to issue not
only the $4,000 1000 Of treasury
notes authorized In the bin in Its
original form. but also additional
notes In an amount equal to the
amount of national bank notes re-
tired. The national bank currency
is to be retired gradually over a
period. OF twenty years. but the bill
in reality now carries authorization
for the issuing OF the $500. o0o. 900
plus STA. 900, the amount OF the
outstanding national bank notes. The
bill. in It's original form. provided
that orie-haif OF the net earnings of
the federal reserve banks shaIl be
paid into the surplus fund. The
trainers Of the measure have made a
change apparently to correct an
oversight. qualifying this with the
words after dividend claims have
been met"
The bill. as altered. gives the fed
eral reserve board more positively
the right to cancel the membership
of any state bank. or trust company.
in the federal reserve scheme.
The bill was Immediately referred
TO the appropriation committees,
both in The senate and in the house.