The Wheeling intelligencer. [volume] (Wheeling, W. Va.) 1903-1961, 1914-11-12
RESERVE BOARD
'tcOntisusa Prom rir.s Pare,

meet the expansions and contractions
OF trade and industry
The rate OF rediscount was not an
nounced- This step probably will not
be taken until Monday. The rate VIII
not be uniform In all the banks.
Definition is Bread.
The definition OF commercial paper
Is broad and relies TO a large degree
upon the language OF the currency act
The board declined ut the present
time TO discuss the question OF dou-
Bile and single name commercial pa
per. IL did make IL exceedingly clear.
however, that IL had a preference for
the two name sort and left no room
Tor the authorities OF the banks to
doubt that IL expected careful inquiry
into one name paper presented to
them for re-discount.
The circular discussed the condi-
tons that have arisen here and
throughout the world through the war
and gave some insight into the eco
nomic changes which might be ex-
pected as a result
1T should be borne in mind" IL
said, that although our exports are
showing a gratifying increase there
$3.50 - 80 ~ Na-h 0dAbntt u
European countries for which gold
may be demanded and that a large
quantity OF American securities held
abroad may be returned to the United
states. while on the other hand. more
than 0.O0O. 900 OF emergency cur
rency must be gradually retired. No
one can estimate the duration of the
war or predict What viii be the finan-
cial or commercial conditions when
peace shall be restored. IL Is prob
able that at the end of the war inter-
est rates in Europe will be higher
than they have been in the past and
greater investment returns will b~
yielded. The tremendous destruction
OF property and waste OF capital will
not only check the how OF European
savings to the States. but may dispose
foreign investors TO return the securi-
ties they now hold. Lower money
rates in this country would be likely
to accentuate this tendency, while.
on the other hand. higher interest
rates and larger investment returns
on our side. would check 1t.
Function Is Two-Fold.
The function OF the federal reserve
banks is. therefore. OF a twofold
character. They should extend credit
facilities particularly where the alb
normal conditions now prevailing
have created emergencies demanding
prompt accommodations, and on the
other hand. they must protect the
gold holdings OF this country in rder
that such holdings may remain ade-
quate to meet demands that may be
made upon them.
While the most acute stage of the.
recent financial emergency appears TO
have passed. the conditions in other
countries make II necessary that the
United States should, to the utmost
degree OF efficiency. organize and
make available its own resources in
order that II may provide for its own
needs and replace the facilities sud
denly destroyed by the closing OF SO
many OF the accustomed channels OF
credit and trade"
In defining commercial paper the
board announced certain basic prIn-
ciples. In brief. they are:
That no bill shall be admitted 10
rediscount by reserve bank the
proceeds OF which have been or are
TO be applied TO a permanent invest
ment. Maturities OF discounted bills
the board holds should be well dis
tributed so that reserve bank should