The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1914-10-15
reserve situation and tho developments
that may be expected I'm the near
GOVERNOR or RESERVE BOARD
SPEAKS TO DANGERS


SPEAKS TO BANI<ERS
Mr.. uamlin gave the bankers earnest
assurance that it was the desire Of the
Federal Reserve Board to cooperate
with the banks OF the country In de-
visinG plan of operation which will
insure tho widest benefits. To this
end. he said. the board invited and
urged every banker to bring to that
body every helpful suggestion which
may occur to him.
we regard our. membership on tho
Federal Reserve Board as sacred
trust said Mr.. Hamlin, land we shall
execute that trust in a manner that will
rebound to the credit Of the banks of
the country and TO the whole people
of the United States.
The opening or the reserve banks.
said Mr.. Hamlin, will take place with
out embarrassment to the member
banks OF the reserve districts. The Re-
serve Board, he said, will next Tues
day confer with the board OF directors
OF all the twelve reserve banks about
the details of opening. At the conclu-
sion of that conference, he thought. IT
will be possible to announce tho ap-
proximate date of the opening. If all
the reserve banks display the same
enterprise as the reserve bank of Rich
mond, he said, the date OF opening
will not long be deferred.
RESERVE BANKS ARE TO
BE OPENED SHORTLY
Governor Hamlin complimcnted the
bankers OH the spirit they have shown
in the disturbed financial conditions re-
sulting from the war, but he gave
warning that the problems which have
arisen should not be SO attacked. that
the remedies proposed are worse than
the disease"
He said in part:
Tho Federal reserve banks are
quickly approaching the time OF open.
ing and operation. AS soon GER
tain necessary \preliminaries have been
accomplished. their doors will open for
business. There is to be Il conference
in Washington OH October 20, at which
committees representing the directors
OF the various reserve banks will be
present and 1t is hoped that then an
authoritative statement may be made
of an early date when banks will open.
MANY important questions arc now
pending before the reserve board.
Among these arc clcaranccs OF checks
and the definition OF eligible CONNER
them. and any suggestions emanatinG
from your body will be conscientiously
considered.
MUST HAVE BRANCHES
IN FOREIGN LANDS
II want to emphasize the necessity of
establishing branches OF our national
banks in foreign countries. We have
already approved applications for two
branches in South America and one on
the lsthmus of Panama. Along these
lines our financial energies should
operate to the great benefit OF agri-,
culture, commerce and the manufacture
ing industries of our country.
Our present difficulties do not APP
pear to arise from the scarcity of actual
money or bank notes. There seems to
be an ample supply in the United States
and much more can be Issued. For
example, the total of Aldrich- Vrccland
notes throughout the United States
available for issue amounts to over ST.
20o,000,000. While there have actually
been shipped to banks only little
over ss4o,oooo,ooo: in the Southern
States alone there are available about
S169.0Oc,000. while there have been
shipped only between $5o.oOO,ooo and
SEQ, 0OO, 900.
REMEDIES MUST NOT BIZ
WORSE THAN DISEASE
The real difficulty would seem to
be one of credit. Mutual trust and
confidence haYe been disturbed. AS to
certain great crops, the demand has
temporarily greatly decreased in conse-
quence OF the war and value has left
it's moorinSs-thy cost OF production.
quickly adjust itself. We should see to
it that the remedies proposed arc not
worse than the disease ITSELF
/ The United States Treasury is In
SOUND tlnanciaI condition.. 1t possesses
ample funds of gold and ample power
to increase the gold reserve should II
ever be necessary
1T should be remembered, that the
reserves to be paid into Federal re-
serve banks Will not reach their maxi
mum until after the expiration of three
years. Al the opening, however, the
reserve banks will begin operations
with II paid In capital of about SIS, 000,-
600 and reserve deposits of about $780,
100000.
1T has been asserted that the assets
of these banks, when they begin opera
lions. will give only limited lending
power.
1T should not be forgotten, however,
that this lending power may be great
| ly Increased by the deposits OF public
moneys. which the Secretary Of the
Treasury is authorized to place with
the reserve banks. Practically all OF
| the government revenues could be de-
| posted and the government debts paid
| by check against such deposits. One
| can state with confidence that the Fed
| eral reserve system at the outset will
increase the lending power of the ma
tional and Federal reserve banks by
some, hundreds of millions of dollars
An amendment is now pending In Con-
Gress under which member banks may
keep all their reserves In the Federal
| reserve banks. This will greatly In
crease the lending power OF the Fed
eral reserve banks. thus increa sing
! their power to cope with the present
abnormal conditions"