Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1915-01-29
MAKES REPORT !
7 Of OPERATIONS
John H. Rich, Federal Reserve
Agent for Ninth District,
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Minneapolis, Jan. 2S.-John H. Rich,
federal reserve agent of the ninth fed
eral reverse bank in an address. here
today gave the first resume OF ,thesin-
stitution's operations. His remarks
follow in part: g. 4
$50 far as any single measure can,
the new banking act satisfies the best
judgment of banking experts, finan.
ciers and business men. 1t ,is not per-
feet. There are here and there de.
fects which will undoubtedly be rem
edied, but they are of minor import
ance and in nc, way detract from the
achievement Of establishing at last,
after sixty years Of argument and de.
bate, q discount market in the United
States and the mobilization Of bank
ing reserves. MY view Of the act; and
the system Of banking created under
it, is a hopeful one. No sound and
we'll managed member bank should
hereafter fail. Panics have been
made a remote danger: New credit
facilities have been extended, through
member banks, to business and agri-
culture generally over the country. a
new agency for the promotion OF
sound development is at hand. These
are accomplished facts. The Ninth
Federal Reserve Bank is open and is
t%ransacting business: The degree
in which it will help business de-
ponds wholly on the degree in which
its member banks utilize the new
rights 1t has extended to them: lt#is
but sixty days old and is yet new to
Its work. j have no fear for the III.
i+ure. It will prosper and, as the
months 60 10y, its facilities will be
more and more utilized in, support OF
the activities of a Thousand North.
western communities. g. w
Release Dead Money. =
where the banks have, without
option, contributed to the capital
stock Of the federal reserve bank In
their district, they have been given
six per cent cumulative dividends and
the federal government has, without
reservation released from their for.
ller boards Oftsdead cash, an amount
CT money. which is now entering the
commercial field in the form Of loan.
able funds, which. makes it quite un
important whether the federal re.
serve banks ever pay their dividends.
/ have;:no tear that the Ninth Fed.
eralF Reserve Bank will not be fully
able to- meet its dividend require
ments and it's reasonable expenses,
ven4in5i It's first year. ut was founded
to perform a service to the public and
while it was in no sense created as .
profit making institution, it will at
the same time take it's moderate earn.
ings in increasing proportion, as its
practical ~;serviceahility to commerce.,
industry and agriculture is extended.
~ The Important Principles.
81 1.-TWO important principles, invoiv.
ed in the operation of the new federal
reserve bahkss have particular appli-
cation .to2the banks of the ninth re.
serve district, comprising "a part Of
Michigan, q part Of Wisconsin, Mime
soia,, North; Dakota South DakOta and
Montana. They r as follows:
" Il. The practical functions OF the
ninth federal reserve bank, In rela.
ton with it's member banks, must BE-
fperformed at. all, times i'm considera.
ton of the nation; wide purposes
which lie back OF the founding OF the
new banking system, and canot yield
wholly to the influence Of district,
state or local conditions. + +@
NJ "2. In. such degree as. the Ninth
Federal Reserve Bank continuously
sexhausts it, resources in meeting the
requests of it's own member banks or
In attempting to stimulate activities
Slocal to it's ewn district or to the
states or localities therein, it places
itself in danger of impairing its ser.
viceability in times of stress, danger
or panic. 80 tie fs@''%r .
ii Paper for R%ediseount.
cot various banking criticisms that
have been made, the most common is
that Northwestern banks have no pa.
per OF the kind and character accept
able for rediscoutt. Those who hold
( this view should study the act. No
suppression could be farther from the
truth. Member banks have only to
! select such paper as. has been made
for the conduct Of current business
las distinguished from paper made
for the purpose Of employing the pro-
ceeds for inyestment), and which is
of the required maturity, and present
IT to; the Ninth Federal Reserve Bark,
to find that it uill.be immediatei's &C.
,ceptei, and ~ e proceeds forwarded
in currency Or placed 20 the credit OF
The arplytEs bank. Paper which IS.
based on AGRICULTURAL, industrial ar