The Washington herald., 1913-06-19

as governor, one as vice governor, and
one as secretary of the Federal reserve
board.
The electors representing the Federal
reserve banks, who shall choose the three
representatives of the reserve banks on
the Federal reserve board. will be Sc
lected by the directors of each Federal
reserve bank, who shall choose one cleo
tor for the selection of the representa-
tives Of the reserve bank in the Federal
reserve board. The said electors shall
upon call of the Secretary OF the Treas
ury choose by ballot the three MEN,
bers of the Federal reserve board, afore-
said, no two Of such members to be resi-
dents of the same Federal reserve dis.
trict. OF the members first chosen. one
shall be elected for term Of two years,
one for four years, and one for six years.
Thereafter each such member shah BE-
chosen for a term of six years. The
governor of the Federal reserve board.
subject to the supervision of the Secre-
tary of the Treasury and Of the board,
shall be the active managing officer OF
the Federal reserve board. He shall be
subject to removal by the President upon
statement of the reasons Tor such re.
moval No member of the board shall
have any banking connections. The Sec
rotary of the Treasury Is to be chairman
of the Federal reserve board. The Of
fee of the Comptroller Of the Currency
is continued.
Powers af Board.
Section 12 empowers the Federal re-
serve board:
a To examine at it's discretion the ac-
counts and books of each Federal re-
serve bank and to require such state
ments and reports as 1t deems necessary.
b. To require, or on application to per-
nit, a Federal reserve bank to redis-
count the paper of any Federal reserve
bank.
c. To establish each week, or as much
oftener as required, rate OF discount
which shall be mandatory upon each
reserve bank and for each class of pa
per; provided, that said rate OF discount
need not be uniform for all Federal
banks, but shall be made with a view
to accommodating the commerce of the
country and promoting stable price
level.
d. To suspend for a period not exceed
ing thirty days, and to renew such sus-
pension for periods not to exceed fifteen
days any and every reserve requirement
specified in this act
e. To supervise and regulate the issue
of Treasury notes to Federal reserve
barks
f. To add to the number of cities CLASH
fed as reserve and central reserve cities
under existing law in which national
barking associations are subject to the
reserve requirements set forth in Sec
ton q of this act; or to reclassify exist.
ing reserve and central reserve cities
and to designate the banks therein situ-
aIed as country banks IN ats discretion.
&. To require the removal of officials
of Federal reserve banks for incompe-
tency. dereliction of duty. fraud or de-
ce.t.
h. To require the writing off of doubtful
or worthless assets upon the books and
balance sheets Of Federal reserve banks.
/. To suspend the further operations
of any Federal reserve bank and ap-
point Il receiver thereof.
J. To perform the duties. functions or
services specified or implied in this act
Issuing of Notes.
Section II OF the bill authorizes the
issuing of Federal reserve Treasury
notes not to exceed s5OO.0O0.Ooo plus an
amount equal to the amount of national
bank notes which may from time TO
time be retired under the provisions OF
the act The notes shall be issued at
the discretion of the Federal reserve
board, and shall purport on their face
the obligations of the United States. The
notes shall be issued solely for the pur-
pose of making advances to the Federal
reserve bank. They shall be receivable
for all taxes. customs, and other public
debts, and shall be redeemed in gold on
demand at the Treasury Department or
any Federal reserve bank. When depos-
tied with such banks for redemption,
they may be charged of by the bank
against the Treasury balances on its
books.
Whenever any Federal reserve bank"
says the bill. shall pay out or disburse
Federal reserve Treasury notes of the
issue herein provided, it shall hold in its
own gold or lawful money in amount to
IS 1-3 per cent of the Treasury notes so
paid out by it. The Federal reserve board
shall have the power in its discretion to
require the Federal reserve banks to
maintain on deposit in the Treasury of
the United States a sum of gold or lawful
money equal to 5 per centum of whatever
amount of Federal reserve notes may be
issued to them under this act; but such
5 per centum shall be counted and in
cluded as part of the 80 1-3 per centum
reserve hereinbefore required. It shall
also have the right to grant. in whole
Or in part, or to reject entirely applica-
ton of any Federal reserve bank for
Federal reserve Treasury notes. But to
the extent and in the amount that such
application may be granted, the Federal
reserve board shall. through its local Fed
eral agent, deposit Treasury notes with
the bank so applying. and such bank
shall be charged with the amount of such
notes and shall pay such rate of interest,
or said amount as may be established by
the Federal reserve board, and the
amount of such Treasury notes so issued
to any such bank shall upon delivery be-
come first and paramount lien on all the
assets of such bank"
May Accept Deposits.
Section Ii permits any Federal reserve
bank to receive from any of its stock
IL