The Julesburg grit-advocate., 1914-01-01

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Washingtoa. Dec. 33.-The nsv bill
Affecting The currency. banking and
0aaAoss of ths csuntsy 10 one Of the
0est tas-rsaeAing MEASURES relating
70 1aAnco that have beoa enacted in
0any ysass.
TAs oaenituls Of the subject. the
1lveesity q interests affected and the
loagtA q he debates in both branches
q eoaSrsss has 70 follow the changes
aal sFasD Tie essentials Of this highly
technical measure in IT. important
bsazinss On money. finance. banking
aad the entire range Of fiscal subjects.
Dablic and private. which It Affects.
Summary ~ the Oil.
With . view. therefore. Of present
ing succincty and in non-tschnical
language an epitome Of the salient fea-
tures Of the measure a. finally framed.
the following summary ID given Of the
bill ~ \ whole and Of It's principal
details:
Generally speaking. the hrst steps
70 b taken TO bring into operation the
nations new financial system will bs
through an organization committee
consisting Of the secretary Of the
treasury. secretary Of agriculture and
controller Of the currency.
Banks have 50 days within which to
dls their applications for membership
In the new system. and one years
time 10 allowed before the government
will compel the dissolution Of any ma
donal bank that refuses to Join.
VIII ''Taks Up the Slack"
The new law will make little direct
change in the operation Of the pres
ent national banks, except to allow
them to loan q certain amount Of their
funds upon farm mortgages.
Its chief purpose 10 to add . new
piece Of machinery to the banking
system that will take up the slack"
during the changing business condi-
tions Of each year; that will give the
banks place to quickly convert their
assets into cash in time Of need. and
that will bring out new federal cur
rsocy when 1t II needed. and retire It
whom money becomes cheap"
Banks are now required to keep .
certain percentage Of their deposits a.
reserves" part in cash in their own
vaults and part Of which may be re-
deposited in the banks Of New York.
Chicago, st. Louis and other designat-
ed cities.
In times Of sudden financial de-
mands. when banks have loaned up to
the full limit OF their resources, these
reserves furnish little relief, because
II they are paid out to meet demands
the banks are left in precarious con-
ditiou.
easle Principle Of Law.
The basic principle of the new law
IL to get these reserve funds out into
circulation when necessary without
lessening the safety Of any bank, and
to provide a place to which local
banks may rush in . crisis and get
cash for the prime commercial pa
per" they hold in their vaults.
This 10 to be accomplished through
. chain Of regional reserve banks. or
reservoirs Of reserves" in which all
banks shall deposit q stated part Of
the money they are required to hold
as reserves.
Under the new system. when a
financial furry comes the banks can
take commercial paper. such as notes,
drafts and bills Of exchange. to these
reservoirs" and secure the use Of
their own reserves, or. II necessary.
even the reserve Of other banks, by
depositins this security.
The new regional banks will re-
ceive about one-half Of the bank re-
serves Of the country. They In turn
will be permitted to loan back to tho
banks all but IS per cent. Of these
reserves. go that in case Of emergency
millions Of cash can be brought out
into circulation quickly.
The banks will have to pay for thes,
loans, however. as individuals have to
pay for a loan from any local bank.
and this charge Is expected to prevent
the too free use Of the reserves held
by tho regional banks.
New Paper Currency.
A new form OF paper currency In
also provided for. to come out in case
Of emergency. and which is expected
to 20 back into the hands of the gov
ernment when times are normal.
These treasury notes" will be printed
BY the government and issued through
each regional reserve bank. and will
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