Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-10-21
WILSON, CURRENCY
BILL STAND HAS
OK. OF SENATORS
Several Changes Now Looked
Forward to as Likely TO
Hasten Legislation.

WASHINGTON Oct. 21-While the
hearings on the currency till before
the Senate banking committee may
not end before Saturday, amendments
have the attention of the members.
President Wilson's intimation that
he win not object to changes in the
personnel of the federal reserve
board and a reduction in the num-
Der of regional reserve banks, has
made 1t practically certain that the
desires of many senators to make
those changes will be carried cut with
the prospect of administration ap-
prevail
Many other important notifications
will be taken up when committee
work begins on the measure next
week. Among the proposed changes
is one that will 20 to the very basis
Of the bill, the provision authorizing
the rediscount of commercial paper
and the issue of currency by the fed
eral reserve banks.
The House provision some wit
nesses have held. was too broad, al
lowing practically all paper of GER
tain maturities designated to be re-
discounted. Others. particularly rep
resentatives of smaller banks In the
middle west, have contended that the
rediscolnt provisions would be USE
less to them.
Expect Change on Maturity Length.
Senators Bristow, Hitchcock. Reed
and Nelson have shown an inclina-
ton to extend the length of the
maturity of a certain percentage of
the paper the reserve banks might
rediscount to enable country banks
holding six and nine-month paper to
enjoy the advantages of the new
system.
Some amendment along this line
coupled with more definite designa
tion of commercial paper" probably
Will be written into the bill.
Under the bill as passed by the
House tho regional reserve banks
may discount paper without limit for
their member banks, but no pro-
vision is made that gives member
banks the right to demand such dis
counts. Members of the committee
are practically agreed that it is nee
essary to provide that a member
bank, as a matter of right, may ap-
ply for and receive discounts up to a
fixed limit.
The compulsory feature of the bill.
under which all national banks would
be required to join the system and
subscribe 20 per cent. of their capital
in stock of the federal reserve bank
of their district and turn over per
cent. of their deposits to the reserve
bank, also may be changed. In that
connection the committee will make
more definite tho provisions relating
to State banks and trust companies
to insure that both State and ma
tional banks shall enter the system
with as nearly equal privileges as
possible. A plan to open the stock
of reserve banks to public subscrip-
ton will be considered.
Another suggested amendment
would limit reserve banks in their
elearings to checks drawn by banks,
leaving the present collection system
for personal checks unchanged.
Lay Increase Percentage.
The provision limiting the divi-
dends to be paid by reserve banks
to per cent may be increased to 8,
and the provision that after the ac-
emulation ola 20 per cent. surplus,
all profits of the reserve banks ex-
cept the dividends shall be dtstribut-
ed, go per cent. to the government
and 40 per cent. to the stockholding
banks, may be changed to give all the
surplus profits to the government.
The problem of whether the federal
reserve banks are to be allowed to
enter the open market to buy or sell
commercial paper in competition with
other banks to maintain the discount
rate also win be considered.
Victor Morawetz, of New York, who
was before the committee yesterday,
resumed a discussion of the bill when
the hearing was taken up by the
committee today.