The Birmingham age-herald., 1914-09-25

nal statement obtainable of the reasons why the board recommended 0,00o in gold instead of s150.000o00, still the intimations are plentiful that this was done in response to sentiment held by a large number of the banks which do
 business at some distance from the chief financial centers
 These banks would be obliged, upon the organization of the regional banks. to part with some portion of their gold reserve which is to be paid into the re- gional banks. If, in addition to this, the banks were to subscribe to a gold pool of $150, 0,000.Coo each according to it's pro- portionate strength, then there was some apprehension that many of the interior banks would feel that they had too greatly depleted their reserves. It was in recognition of this sentiment, probably. that instead of $i50 900 in gold, as at first proposed as the maximum of the gold pool, the amount was fixed at sl00,- O0oO 900.
 What the Result Will Be The moral support of the federal re-
 serve board is now assumed. Therefore it is certain that an attempt will be se- gun to establish this gold pool and to do it as quickly as possible. As no na- tional bank is under compulsion to sub Scllbe lb lut lOOi, ltltlC VIII bOt oA good deal of curiosity and possibly some anxiety, about the result Of an appeal of this kind to the national banks
 The proposition involves no more than voluntary and somewhat aruiiciai method of getting around the emparrass
 ment occasioned by our lack of any ceh- tral or unified bank for the United states If there should be established an Inter national clearing house and at the same d. 41. undertake to act as far as in Its power it may act as a unified bank TOT tue United States so that there may be deal- ings with the central banks or Europe then it is likely that long step Tn the direction of the reinstatement Of normal conditions will have been taken.
 Very likely Congress may be persuaueu at it's session next winter so to amend the national banking act as to make II pos sible for the federal reserve board easly and uuiclxly in emergency to assume Vle functions of a central or uhined Dafhh' The experiences since August have clear ly demonstrated the need of an organlza- ton of that kind. The federal reserve board is to have great power so far as mobilizing the resources and centralizing the credit are concerned, but there would undoubtedly be still greater facility for the exercising of these functions if there were unified bank over which the fed eral reserve board stood in complete au- thority.
 A Great Object Lesson
 The United States is now learning. or at least has an opportunity to learn, a les son which in the past has not been taught, or if anyone tried to teach it the instruc- ton has been disregarded The country as a whole is now learning how essential it is that there be in the United States a great market place where quotable values for securities can be ascertained and where transactions in securities can be carried on. For it is now evident that there can be no important revival of busi- ness activity in the United States until the securities market is open.
 The best authorities in this city are now persuaded that not at any time since credit has been utilized almost exclusively in the carrying on of business and in the con duct of financial operations has there been problem of such magnitude and dif- ficulty as is the one which now not only the American people, but the eommer- cial and financial peoples of the entire world. are facing. One of the difficulties which must be overcome before the prob lem is solved lies in the fact that the sit uation is without any precedent. The world has never known a financial leader ship and economic ability must be called upon before there will be any solution of the problem.
 So far, the financial leaders in the United States seem to have been fully equal to their great responsibility. There is not the slightest evidence that any of these leaders either sees or seeks opportunities for money making. The underwriting sym dicate which has arranged for the pay ment of New York eitys existing obliga- tions in no event will receive more than per cent as compensation and runs the risk of meeting with less. The great bank CTS of New York, Boston and Chicago, in association with some of those of St. Louis, Cincinnati, Baltimore and Minne apolis, are trying to work out a plan whereby the commercial deadlock can be ended. And they are doing this without any expectation of gain Of course. if they are able to perfect a plan which will make it possible for American mer chants, importers and manufacturers to pay their existing obligations abroad that will ultimately be a source of reasonable profit to the American banks, for it will lead to safe and large business.
 Our leaders in the world of finance and of business, in cooperation with the ad ministration, are persuaded that they must also act in cooperation with similar lead CTS in Great Britain France, Holland and, as soon as possible, Germany This CO., operation will demonstrate the intricacy of the financial and commercial relations of the civilized nations of the world. It is upon cooperation that we must chiefly depend for creating conditions which will make 1t safe and practicable to reopen our great securities markets There is now general recognition of the fact that not until this market is reopened can there be any great revival of American