New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-06-22
it's discount rate be pubic, subject 70
chanue weekly2

| its discount rate be puptio, suoIeS>
change weekly
Answer-They should rediscount for ai'u
with the Endorsement of any bank ha''"e
a deposit with them commercial paPe
! of short maturity and bills of eXcha"e'
arising out of commercial TRANSACTIONS,
The discount rate, which each regional
reserve association should have power "
fix for itself, should be equal to all POI
| ticipating banks in the region. shouiu %
made public and should be subject "
| change when in the opinion Of the o'Fe''
tors a change is desirable.
q. Should il loan directly to Nom !,
Der banks with or without colIatera,
security, and should the rate OF lnteres'
be equal TO all, public and subject 70
change weekly7
Answer-Regional reserve associations
should be permitted to loan Directly ~
member banks against satisfactory wi
lateral security whenever on the repre-
sentation of the directors OF the regioha'
! reserve association the central ooaro oi
| control. referred TO in our answer W
Question 10, is satisfied that the public IN
terests so require and give Its consent
thereto.
GOVERNMENT FUNDS IN
RESERVE ASSOCIATIONS.
%. Should reserve associations be
pern,itted 70 deal with each other in the
purchase and sale Of commercial paper,
exchange, securities and soldY
Answer-Yes.
%. Should government deposits be
withdrawn from, banks and placed WIN
the reserve associations, and, II so, now
should they be apportioned, and wnas
rate Of interest, il any, should DO pa'd
| Within what time could this be sareV
done2
Answer-Government deposits should De
withdrawn from the banks gradually
over period OF not less than two years
and placed with the regional reserve as
sociatlons, except in such localities ~nere
II is necessary for the government 10
have bank accounts for its own con-
venience. The apportionment among the
regional reserve associations should be
| largely a matter of convenience to tho
government, but as much as possible tney
should be divided in proportion 10 the
capital OF the different associations
| Deposits secured by per cent oonds
should not be Withdrawn except as the
bonds are taken over from the banks OF
refunded into bonds bearing such rate
OF interest as will make the same worth
par without the circulation privilege.
RELATIONS OF BANKS
TO THE ASSOCIATIONS.
"a. Should every national bank be re-
| ouired to keep its reserve with the as.
| ISOLATION TO which il belongs except
such as il keeps in its own vaults; or
should il be permitted to keep any GER
tain per cent Of its reserve with otner
reserve sssoeiations7 " so. no" n'uen
Answer-In connection with this ques-
ton as to whether national banks should
| be required 10 keep all their reserves
with the regional reserve associations 10
which they belong or should be per-
mitted 10 keep any certain percentage OF
them with other regional reserve associa-
lions. the question arises whether the
banks are 10 keep their active checking
accounts for exchange and collection pur-
poses with the regional associations or
not. II each regional reserve association
| is to handle the exchange and collection
accounts OF it's member banks then the
! further question arises, Could the re-
gional reserve associations also handle
such accounts OF the banks outside OF
their own region'
Could. FOR instance. the regional re-
serve association located in the City OF
| New York undertake 10 handle the eN-
change accounts OF the banks all over the
country that need New York accounts;
and. II so, should such banks be per
mlt,ed 10 count their balances In the New
, York regional reserve association az a
| part Of their reserves? In our opinion.
the regional reserve associations could
not be satisfactorily organized so as TO
handle economically the enormous
amount ~ work entailed by the keeping
OF such accounts.
We are. therefore, OF the opinion that
the reserves OF the banks kept with the
regional reserve associations should be
confined To their balances kept with the
regional reserve association in which
they are shareholders. The banks In the
reserve and central reserve cities now
| ActnE as reserve agents SnOuld De per-
mitted to continue to so act. The re-
serves Of the banks outside OF the re-
serve cities should he divided equally
| into three allotments-one-third 10 be
kept in their vaults. one-third TO be kept
on deposit with the regional reserve as
sociation in their own district and one
third on deposit with their duly appointed
legal reserve agents in reserve or central
reserve cities; the same division OF re-
serves might be applicable TO the banks
I'm the reserve cities. and the banks in
the central reserve cities might be re-
quired 10 keep one-halt OF their reserve
In their vaults and the other half on de-
post with the regional reserve associa-
ton. which. of course. would be located
In their own cities.
ACTIVE ACCOUNTS IN
IMPORTANT CENTRES
! The reserve balances maintained with