Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1914-01-19
serve bank, to he fixed by the Federal
reserve bond

serve bank, to he fixed by the Federal
reserve bond.
ut is also provided that member
bank not located In central reserve
city may make loans secured by farm
lands for time not longer than five
years and for an amount not exceeding
90 per cent of the actual value of the
property and for an amount not to OK
coed u per cent of tue HapItat and sur
plus, or one third of the time deposits,
of such bank making the loans.
Amended Vreeland Bill
we realized in the Senate that a con-
siderable portion of the present year
would he required to organize and to
put into effective service the Federal
reserve banks 1t was apparent last
fan that loans We're being contracted on
account OF the belief that pending the
complete organization Of the Federal re
serve banks the subscription by mem
Der banks to the capital stock and the
transfer of reserves to the Federal re
serve banks would lessen the amount OF
currency at the command of the banks.
ITO avoid this trouble we amended the
Nreeland Aldrich act, As passed in 1908,
and as 1t stood upon the statute books
while 1t provided for the loan to bank
ing associations of 5000, 600 900 of notes,
the tax placed upon the loans was SO
heavy, reaching I'm the nth month 10
per cent. that the rate was almost pro-
hihitiVe
tax in the Nreeland- AldriCh act so that
the maximum rate would be Is per cent
while the rate for the first six months
would average only about &ls per cent
per annum. This provision of the bank
ing and currency act has greatly re-
leved an apprehension Of enforced con-
traction during the present year. and as
II will continue in force until July |,
1918, there need be no scarcity OF cur
renCN pending the complete organizs
ton Of the Federal reserve banks.
Under this amendment the use OF
Sl00 Ivy a banking association for six
months involves a tax OF only $t75 II
Is impossible, therefore, under such a
condition 70 have currency stringeucy
pending the organization Of the sys-
tenn.
Approves New Measure
- do not hesitate to give my most
cordial approval to the new law, II will
prove new freedom to the business OF
our country 1t will prevent currency
panicS. II viii safeguard against runs
upon banks. 1t Will make the reserves
Of banks available when needed II
Will make currency elastic, II Will en-
able banks to expand their business. Il
will facilitate the removal Of money
from a section in which 1t is not needed
to section in which II is needed.
"Thoso who have objected to Govern
ment supervision and control Of Fed
cral reserve banks forgot that while the
stock Of the Bank of Germany and The
Bank Of France is owned 10y individuals
the directors are designated by the Gov
eminent and that while the stock OF
the Bank OF England is privately owned
bankers. brokers and discoumters Of hills
are excluded from the board OF directors
and the bank is really controlled by enc
under law that amounts TO Government
supervision equal to that provided by
our banking and currency hAl
"lt rs now perfectly evident that all
the great national banks Of the country
intend to await themselves Of the priv.
| ilcEe of becoming members " Fedora
Advises Bankers to Join.
81 do not hesitate Ia advise state
banks to take advantage OF the oppor-
tuuitN To become members OF a Fedora
reserve bank They will only be re,
CURED To take from their assets pei
cent Of their capital stock and surplus
to he Invested I'm the stock OF the Fed
eral reserve bank. They will receive
per cent interest on the investmut L
they are disposed TO complain that The
law requires that q portion OF their re.
serves he deposited with the Federal re,
serve bank while they now re-
oeive per cent interest In New York
/ would reply that the money which the
banks keep there on deposit is the mon
ey of their depositOrs, and tho beuei
| that would come To the dCpositors ant
the local bank from having the deposit
in a Federal reserve hank would ht
greater than the per cent interest or