Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1913-12-25
SALIENT FEATURES OF THE
NEW u. S. CURRENCY LAW


loans made to member banks and from
the purchase and sale Of bonds and for
eign bills of exchange.
NEED PAY IN ONLY HALE
Member banks will be compelled to
put up in cash only onc-hulf of their
subscription to the capital of the new
banks; the rest can b. called for if need
ed by the regional bank. Dividends of
six per cent. will be paid on this stock
to the member banks, and the stock will
be non-taXablc. After these dividends are
paid, one-haIf of the ;urplus net earn
ings goes to create regional surplus
fund, and when this has reached 10 per
cent of the regional banks paid-in
capital, these earnings are to go into
the United States treasury. The balance
of the net earnings are ODE paid to the
United States as a franchise tax.
With the machinery thus created for
a new banking system that is sup
Elementary to the commercial banks of
the country the law provides for n
gradual transfer of part of the bank re-
serves to these new "rcservoir" banks.
In order not to disturb business cond-
lions, or to withdraw too suddenly the
heavy deposits OF country banks in the
large cities. the Law provides that three
years may be consumed in hitting these
balances, and that If necessary. part Of
the reserves transferred to the re 'onal
banks may consist g commercial paper.
The amount of r,.cr roruir from
every bank under the new law, and the
plocc where If must be kopt. are .s
follows:
Couptr,. bonl,s. fatal roeo,.,,o roouired
10 nor cont of dop,,rd donosits and two
nov cont - ti,,o d.rosi,s t,tvo-trc,f,bs
n,rst hc l,ant in tho hanks vaults for two
.vo.re and forr-twc1ftbs of+or that limo
For tbo fret 20. :, t,vo-tve,fthe must be
kent in thc r,rional hank. increasing one
twelfth each six months thereafter until
1t reaches iive-tWelfths Of the total re-
serve For three years the "hal'ot'ed
part OF the reserves may De kept IN IN"
banks OF reserve cities after that time
must be kept either IN the country banks
vaults on IN the regional reserve oahK'
Reserve city banks; lotal reserve re-
CURED L. per cen" oI c'Hlllu an" "Nc
per cent ol time deposits SlN-HIt''i'tH9
must ne kept III th' pdiNS vaults l"r '"'
IISt Two H'"iS' anu "N'-"'''c'''"N 'i''i
'hal ''ih'' ihr''-Hl 'e'H'"S must ne h'Pt
IN the r'Elohal reserve paHN 10Y inc "rs'
year. increasing ohe-hfteehth every SIX
months thereafter until II r'a'"'s SIN
Hlt''nths' for 'nro' years '"o uH'''o''t"
PoIu'" ~ t'' i'9'' W. ma "' !" ~ ~
regional bank: after that time in one OF
the latter two places
Central reserve city banks CNcw York.
Chicago and st Louis: Total reserve
required. rs ncr cent of demand, and five
per cent. of time deposits. cighteenths
must be kept in the banks own vaults;
seven-cishteenths in the regional reserve
bank and the remaining hve-eighteenths
in either place the bank may choose.
REGIONAL BANKS DEPOSITS.
.r,,.., i,,,,,,orso ,,,,,d, ~ rosor,.os rro,,,
.....'...,.... ,'''..,'.. ,., .......,.,.
mon, ,,one,.. u.iu naL,. ~, tho d.no.its
IF TIM, r.,,inro, ,.so,,.o r,rl,s r,,cb of
those n,nI,, ,,3ll H., ,dr,iristorod ~, q,
h,o,d az riro di,,,ctors civ &c WHOM,
I'm h.. ol,.,od IN. +ta b.,,,s md tb.oa
,,,,oirt.d In. tho f.dor,1 roso,v. hoard
,,,. ,oe,io,,l roso,,.. hanks may rodis-
co,,,, tho, l. hu,, az , discount from
tic n,.rber hanks "n,.ma commercial
,,,,.,." ,,.b.r tho n,o,nh.r borl.e dosira
g. ,on,.o,.t those o-sa,s into money The
,>.,.+ to,.n,. or tbi. innortant nrovision
nc ,u ,b. ch,,a,.t,r of ,anor ,unn which
tho r.ci,,,.I resor,.o hanks NAV fu,nisb
cash arc nc follows.
"t-non tho Endorsement of any of IFS
member banks. with a waiver of de-
Il 1,- anil