The Julesburg grit-advocate., 1914-01-01
New Cnsrsney HI

BY beth branehes Of Congress On tn
22nd was signed ~ Prssiden
Wilson on the 13rd inst. 1As aag.iGud
Of the subject. the interests invo,v
ed and the length eftins taken up b.
debate in both iranehss u csagres
has made it almost 'impoasible for tn,
ordinary reader to iellow the chanxe,
and grasp the essentials Of this yer,
technical measure and with . view o.
presenting as plainly n possible W,
are giving our readers herewith som.
of the principal featurts Of the msa
sure.
The first steps to put in operation
this new financial measure will be the
organization of committee consistin.
of the Secretary Of the Treasurer,
Secretaryof Agriculture and Controller
Of Currency. All banks viii have &C
days to file their application for r.en
bership and one years time will be
allowed before the Government will
compel the dissolution of any national
bank that refuses to join.
The operation of national banks will
be changed but little except they will
be allowed to loan n certain amount on
farm mortgages. Banks are now re-
quired to keep a certain percentage of
their deposits AS reserve and the idea
of the new law is to get these reserve
funds into circulation when necessary
without lessing the safety of the bank
ard also to provide q place where local
banks may get cash for commercial
paper held in their banks.
This win be done through system
of regional Reserve Banks in which all
banks shall deposit certain part of
the money they are required to hold in
reserve and when necessary, banks
can take commercial papers and secure
the use of their own reserve, or if
necessary, the reserve of other banks.
paying to the Regional bank regular
interest charge.
A new form Of paper currency will
be provided in case Of need which will
be guaranteed both by the Regional
bank and the Government. This will
go back into the hands of the Govern
ment under normal conditions as each
local bank will have to pay interest for
the use of same.
Regional banks will be located in from
eight to twelve cities in the United
States ard all national banks in each
District will be required to subscribe
for stock in the Regional bank IN that
district.
Local banks will be known as Mem
Der banks as they all own stock in the
Regionl Bank. They will be required
to take capital stock equal to 6 per
cent of their Banks Capital and sur
plus. ~ - 20
National banks are compelled to join
and state banks will be permitted to
do so if their banks meet the standard
set for national banks and they submit
to national examination.
The public will be permitted to take
stock in the Regional Bank only in case
there are not enough banks in the dis
trict to provide capital stock of four
million dollars and then only twenty
five thousand dollars worth of stock
will be allowed any one individual.
Only l of the subscription of member
banks will be called for in cash. The re-
mainder can be called when needed by
the Regional Bank,
Each Regional Bank will be govern
ed by board of 9 directors, 6 of whom
will be elected by the member banks
and appointed by the Federal Rererve
Boa,d.
The Regional Banks may buy at a
discount from the member banks, COM
mercial paper, provided same has a
maturity at the the time of discount
of not more than 80 days and notes for
agricultural purposes having maturity
not exceeding 6 months.
The Federal Reserve Board will have
final control over the entire operation
of the system. They can compel one
Regional Bank to loan to another in
time of need and can remove directors
of Regional Banks whenever it is nee.
essary.
The new law permits all national
banks except those in New York. Chi
cago, 4i.L St. Louis to make direct
farm loans on 5 year farm mortgages
up to 25 per cent of, the capital and
surplus or up to 1 of their time de-
posits,