The Washington times., 1914-11-22
NEW BANK SYSTEM
STRONGEST IN WORLD
federal Reserve Institutions
Now Constitute BuIWark of
All Moneyed Things.

ITS as strong as the Bank of Eng
land" has frequently been the superb
ative form of expressing confidence in
the realm of finance, but a statement
.ssued by the Federal Reserve System.
covering the condition of the twelve
Federal reserve banks. shows that the
newly created financial system of the
United States is now the bulwark OF
moneyed things.
The twelve reserve banks have q
gold reserve of SO per cent of all the!r
liabilities, and this is far in excess OF
the gold reserve claimed by the Bank
of England in these war times. The
Federal Reserve Board makes a graft.
flying showing in its statement, with
gold reserves Of approximately s220,.
100000
The current weeks return Of the
Bank Of England lists the proportion
of reserve to liabilities" at 34.N per
cent, as compared with a proportion OF
1886 last week and 54.g7 of a year ago.
Comparison Is Shown.
In comparison the statement issued
by the Federal Reserve Board. reveal
ing the condition of business Of the
twelve reserve banks at the close of
business November 20 shows:
Gold reserve against all liabilities,
50 per cent; cash reserve against all
liabilities. los per cent
The statement made public last night
by the reserve board is the first con.
solidated analysis Of the condition OF
the new system recently put into oper.
alton here.
While figures concerning the chief
financial institutions Of all countries fea
the current week are not readily OBJ.
tainable here, financial experts assert
that the gold reserve Of this country
new system undoubtedly leads the world
The cash holdings of the Bank OF
England as of November 10 We're $685..
S5o.ooo in gold, but the percentage OF
gold reserve to liabilities was far be.
low that shown by the twelve Federal
reserve banks now in operation,
The consolidated statement of assets
and liabilities of these twelve banks is
as follows:
Gold coin and certificates, saO2. Ale. 900:
legal tender, silver certificates and sub
sidiary coin, $S7,3OS, 600; rediscounts
$3.50, 900; all other assets, $4,000; total,
$246. 90, 900.
The liabilities consist OF capital paid
in, SlS072, ,000 reserve deposits. $227, LBS, 900;
reserve notes in circulation, 81, ,215,0 900; to-
tai, S246. Az, 900. The analysis then makes
the proud claim Of a gold reserve
against all liabilities Of SO per cent, in
dicating remarkable strength.
Rates of Rediscount.
The statement continues:
''Rediscounting privileges have been
awaited of to a considerable extent in
New York, Chicago, St Louis, and
Kansas City Elsewhere the showing
is much smaller. Federal reserve notes
TO meet local demand have been issued,
principally in Chicago, New York. and
Minneapolis, but every bank has been
supplied with an adequate quantity OF
notes to meet its needs. The relatively
small amount of rediscounts. as COM
pared with the resources OF the system,
is due to the policy OF the Federal Re-
serve Board in encouraging the pay
ment of reserve deposits in actual
money instead of in rediscounted paper
Rates of rediscount established q week
ago were fixed with this policy in mind,
As outlined in circular No. TO- some
lime ago issued by the board Reports
from all districts are OF the most en-
coura aging nature. and the outlook for
business is stated as satisfactory. The
esta ablishment OF the system has al
ready had an important effect in in
cre2sing the lending power of the men,
her banks, in addition TO the loan power
or the Federal reserve banks