The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1913-06-23
CNational News Association

| (National News Association)
WASHINGTON, June 23.-Rep. Car
ter Glass, chairman of the house COM
mittee on banking and currency. to-
day made public digest of the admin
! istration currency reform bill. which
he introduced in the house today. BY
the terms of this measure the federal
reserve board which will control the
issuance of new currency on the ap-
plication of the regional reserve
banks. is to be a government board en-
tirely. There will be no retirement OF
existing national bank circulation nor
of the existing two per cent United
| States bonds used for circuation pur-
| poses.
Note Issue Is The Same.
Every national bank is allowed TO
continue it's note issue exactly as at
present
The following is in part the digest
prepared by Rep. Glass:
The purpose of the bill is to fur
nish a comparative revision of the cur.
rency system of the country so as to
obtain three principal objects:
First, provision of a means for re-
discounting commercial paper of speci-
fed types.
Second, provision of a basis for
elastic note issues properly safeguard.
ed.
Third, provision of machinery for
doing foreign banking business.
I'm order to accomplish these pur-
poses fully ii is necessary to repeal
certain portions of existing laws; TO
rectify various conditions in the pres
ent national bank system which are in
some cases only indirectly connected
with the objects sought; TO furnish a
| new class of institutions for the per.
| Torrance of some function which can.
not we'll be intrusted to existing banks
ed by others, and to alter the present
reserve system to a very material de.
gree.
The Fundamental Idea.
"The fundamental idea of the bill is
the creation of a new class of banks
to be known as federal reserve banks
the chief points about which are as
| follows:
The number is to be twelve, with
I possible increase later.
The ownership is to be in the
hands of the stockholding banks OF
the twelve districts in which the re-
serve banks are situated.
National banks are compelled to
be members, and state banks and
ha
members.
THE capitalization is to be twenty
per cent of the capital of the stock.
holding banks, one-half paid in and
one-half subject to call.
Reserve Banks Functions.
THE business of these federal re-
serve banks is to beas follows:
"Rediscounting of paper presented
by stockholding banks under specified
conditions, provided such paper grows
out of actual agricultural. commercial
| or industrial transactions, and does
not run more than a specified number
of days.
Buying and selling government Sc.
curities, gold and silver bullion, for.
eign coin, foreign exchange and open
market bills of given maturity.
Government fiscal operations.
Every national bank is allowed to
continue it's note issue exactly as at
present and in addition federal reserve
treasury notes are authorized to be
| issued to an amount not TO exceed
$500, 900 900.
These notes will, upon application,
be issued to the federal reserve banks
upon prime short-time commercial pa
pers and other liquid collateral"
In the belief that the present reserve
system is antiquated and unsatisfac.
tory provision has been made for re-
Continued on Page Eight)