Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1913-08-01
Treasury Department AuangeS
to Deposit twenty-five to
Fifty Million Dollars in Ma
liOoaI Banks,
LIBERAL RULE MADE
AS TO SECURITIES
State and Municipal Bonds
and Approved Commercial
Paper to Be Accepted First
Time by Government

tsf soaupe Jouan.t srtli.t ttAttp WAS
Washington. Juy 8l Twenty
million dollars ot government funds
will be- deposited in the national banks
of the south ana west at once Ey Sec
rotary McAdoo to facilitate tn move
ment of crops rcurraL state and
municipal bouas ana PRIME commcr-
cia paper VIII ee accepted as security
for the money on WniCn tnc banks viii
pay per cent lnlcrest
The motive of Secretary Mctdoo i0
establishing this policy is 90 mticl-
pate the money stringeucl i'm the late
summer and fail which invariably uc-
companies the marketing and move
ment of crops. especially when They
are unusualy large ass the harvest
now beginning. forecasts HE intends
to take time by the rorclock and pre-,
vent or minimize The usual ushmess
of money
I'm a statement tonight. the secretary
made the significant announcement
that government bonds would be- oc-
eepted at par as security for the new
deposits and that the additional money
would he placed only at banks which
have taken out Aat least 40 per cent
of their authorized circulation The
United states per cent bonds. sorV-
ing as security for most of the na-
tional bank circulation have been dee
pressed recent 10 ncw low market
records, dropplre 10 953-l in the
last few days. The secretary VIII
irgncss to accept these bonds at
par as security for the twenty.
five to fifty millions OF promised
deposits and the inducemcnt to the
national banks to increase their cir-
culation up 10 the 40 per cent limit
is expected to help in restoring the
parity of tho depressed two's by ere
ating a new market for them.
For the first time IN history. the
government win accept prime COM
mercial paper as security for deposits
This privilege will Zee granted am
nounccd the secretary i'm order TO
make the special deposits available to
banks ON securities readily within
their reach.
Tho commercials paper submitted.
added Mr. McAdoo. shall first be-
passed upon and approved 10y the
clearing house committees of the cities
in which the banks offering such pa
per may be- located An commercial
paper ana bonds must he passed upon
finally aud accepted by the secretary
Approves commercial paper will be
accepted as security for the deposits
az So per cent of IFS face value and
high class state municipal and other
bonds, exclusive Of government bonds.
1T 75 per cent Of their marked value.
Tho additional deposits Will
placed with the national banks in the
Two or three principal ait,cs in cucl
b tho states where harvesting now Is
n progress AMI whore tb. demand for
itEcy for moving crops most coutcn
entity can be met The secretary euG
Z would not be- practicable to scatter
he deposits among the smaller cities
'sl ucialh in yicV.of the character If
securities necessary.
The banks viii oc required to rc-
rrn the money TO the public trcas-
lry WHOM the crops have been moved.
rh present suggestion is Mr N.Aduo
aid that f. per cent be paid b d.
'ember' 80 per cent In January 800
'c' cent in February, and - per cent
u March next
"Stcps now ara being .alscn 70 carry
'u the plan added The secretary {
sc that the funds may be available I
promptly for the movement &C the
reps"
The names OF the banks to receive i
he deposits and other details of tho /
arrangement win De announced mtor. {
This new policy Is the antilhesis Of
bat adopted Us former Secretary of j
he Treasury MdcVeagh. who u year ]
80 declined to make government dee S
.osits TO ceIicyc tbp tight mono, uar-
ct ON The ground that the moderate Z
rrplus Of federal funds at that time f
lould be held as reserve TO DO util-
red at some possible critical stage. t
with the net balance in the general i
nd today amouutine 20 nearly Si32.-
10000, Secretary McAdoo has taken 4
~ t.ht'''A htffiN Ailf' -'N 'A tfAilfll NtViII'
ut,cipatc the situation Dy placing dee I
osits where and at the time they are
coded. If the fun SjO.000.00O Us de =
ositcd, this step temporarily viii g
early double the governments de- 4
lsit with the banks which at the
resent time hold $5S,00000o Of fed Z
'a funds. d
Just as Secretary McAduo was an "a
'uncing his ple1 Senator filman az q
tuth Carolina. was issuing state II
cnt declaring that unless congress GO
ted quickly to urovide an emergency ri
'rrency the cotton planters Of the q
nth would lose q hundred million pl
'iars thTouah inability e. got meucs al
move their crops. III