Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1913-07-01
Essential Features of the Nezv
Currency Reform Measure

D. llIINIIhllhH 'Hl lfn'A Hlll N"A H''''
pDhli. last week by Representative
Glass, chairman of the house com
mttce on banking ana currency II
VIII bee introduced IN the house and
scnat, after President Wilson has
delivered in person his address to
congress on Monday
An outline Of the measure prcpnr-
cd hy NJ. Il. Gl.ss describes the meas
urc as a basis for legislative action
states that II viii be- gone over In de-
tai Tor alterations, and sets out that
II, purpose II to accomplish three
principal objects,
Provision uf means for ro-dis-
counting commercial paper Of spcci-
fed types
basis for elastic notes properly
safcguardcd
Machinery for doing foreign bank
ing business,
The measures essentials remain as
tlcy have been outlined from time to
time since the President began
study Of the subject with house and
senate leaders, Secretary McAdoo and
other advisers. providing u or more
fedora reserve banks which Will re-
discount paper. deal i'm government
securities, exchange and conduct
government fiscal operations Nation
al banks and such state banks and
trust companies as conform To stand
ards would be stockholders ~ the re-
serve banks. The government would
hold no stock.
Government Would Control.
The government would control the
federal reserve banks entirely through
a federal reserve board of seven mem
btrs. in which the banks would have
no representation. The board would
be compos' Il Of the secretary of the
treasury. secretary of agriculture, the
comptroller of the currency AS mem-
hers eN-officio four other members
would be chosen by the President and
confirmed by the senate. The nation
al bank note circulation would remain
uudisturbcd and no proposal Is made
In the bin for retiring approximately
500, ,0OO. 900 two per cent bonds upon
which that note issue now rests An
amendment or separate bill TO refund
/ these bonds into three per cent bonds
may be introduced later.
In addition To this 500, 600, 600
existing national bank notes. not
more than S5O0,O0O,0 ,00O in what are
known as federal reserve treasury
notes might be isued at the discretion
of the federal reserve board solely
for the pGrpos" of making advances
to the federal reserve banks, which
would do no business with the public,
deal only with their member banks
and receive deposits only from the
United States While the notes would
ON their faces. purport to he the OBJ
! ligatiun of the United States. they
would be required to be secured by "A
sold reserve of 33 Ia per cent pro-
Nidcd by the federal reserve bank,
would ho q first and paramount lien
on an the assets of these banks and
would be rcdecmable in gold on de-
II ana at the treasury department In
/ the city Of Washington or any federal
reserve bank
Guarded Against Initiation.
stringent provisions are made
against counting of these notes as
! part of bank reserves and the system
| is guarded against initiation by lodg-
IiLr power with the federal reserve
board To exact an interest charge
upon the treasury notes In order to
/ insure their prompt redemption. The
Totes are not made legal tender but
would bc receivable by the govern
m,nt and every bank Of the system at
par. without exchange.
40 change would Doe made In the
/ protection Of other exchange notes.
The federal reserve board would
| Ir,cuirc one federal reserve bank to
r, discount the paper of anothr and
would establish rate on discount not
necessarily uniform for an reserve
banks but made with view 10 ac-
crmmodating the commerce Of the
country and promotion a stable price
level
For rccastiug the present bank re-
serve system. the hill proposes to
transfer the reserves from National
banks'in the present reserve and cen
trail reserve cities to federal reserve |
banks. carrying the process Of trans |
fct over 3S months to avoid shock !
to market conditions. The hill pro- |
poses according TO MIR. Glass state
mont. ultimately the establishment |
of reserve system in which country /
Banks viii have Is per cent Of re-
serve ,ie - per cent of total demand
hGbiities) such 10 per cent to he
held. five per cent In the banks vault.
five per cent. with the national re-
serve bank and five per cent either
at home OF with the reserve bank,
while reserve aud central reserve city
banks have reserves Of 90 per cent of
demand liabilities. ~ which 10 per
e., Mt viii be at home. five per cent
with the reserve bank of the distnct
and five per cent. either at home or
with the reserve bank" the state
ment says.
stop stock Gambling.
The presumed effect of this plan
will be TO md the placing Of reserves
with central reserve city banks for
100. la afn,L market np,rati,pa IN