Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1915-11-19
Federal Reserve Officials De-
clare Panic Was Averted
During European War on
Account of New Methods
IMPROVEMENTS TO BE
MADE IN NEAR FUTURE
Controversy Expected When
Congress Meets NextM Month";
Effort VIII Be Made 10 Mod
iy Law Now in Effect


.sse,al eosssspoHnEEct TO HoEsisa JOURNAL
WASHINGTON. NOV lS.-EXpressions
of satisfaction on its performances of
the last year and predictions of bcne-
ficlal achievements in the future we're
voiced today by federal reserve board
officials in commenting on the first
birthday of the new banking system,
which fell on November 9.
Numerous Benefits Claimed.
Among the features Of the work SO
far accomplished by the hoard Off
eals cite the following.
Virtual precmding of any possible
manic because of the European war.
Arrangement for the admission Of
state banks to the reserve system,
Standardization Of commercial and
commodity paper ana bankers and
trade accommodation paper
Assistance in the movement for
standard warehouse legislation in the
south and west
Making effective the provision for
confcrrng fiduclary powers on ma
tiona banks.
Arrangement for financial relief Of
the south at the time of the cotton
depression,
Institution Of the clearing system
and the gold settlement fund in
Washington.
'IIousc Cleaning" Accomplished.
Even greater than these Items, how
ever. it is said, has been a wide and
ihorgueh "nause rh-an.NB by the
banks. nccessnated by the standards
imposed By the board Of collateral on
loans and accommodations and gem
eral acceptance of these standards by
The banks
Further Activities Planned.
Among the items on the program of
the board for the immediate future
are;
Development Of general clear
ing system among reserve agents
Formulation of regulations for
the purchase of bills in the open
market By the reserve regional
banks, without going through the
member banks This, i'm effect
win place the reserve banks in
competition with member banks
and will doubtless give rise to
spirited controversy.
Development of the foreign fl
naneial field and establishment
Of foreign agencies Much Of
this Development must await the
conclusion of the war In Europe.
supplementary legislation also is
under consideration by a special COM
mittee Of the board, none Of which,
however is said 20 be of any great
significance.
Controversy in Sight
The board will watch with inter
est The anticipated movement in con-
gfess to transfer from the secretary Of
The treasury to the board the power
TO make government deposits in the
various national banks. Such a bill
VIII he strongly opposed by Secretary
W. G. McAdoo and supported by
ifiends OF the board This provision
appemed In the original federal re-
serve bill, but was stricken out be-
cause the administration took the po-
sllion that the control oyer govern
lhent funds was properly an admin
NfalYe function. There are ele-
ments Of big row in this proposed
legislation
Officials Pleased With Outlook.
IN general summary of the situa-
uon' officials of the board say. with
sf"llieaton, that no national bank
mas smut mp shop or become a state
plnk because Of dissatisfaction with
the new system Nor, say the hoard
authorities, are they depressed by the
,act 'hat only about thirty state banks
nave come into the system.
20 far approximately 400 national
oaRks have successfully sought per-
u'SSlon TO exercise fiduciary powers
9nu the board does not seem to fear
e'ioctual opposition from the trust
line
Napohal Clcaranccs Made Cheaply.
iP connection with the gold settle
tuent fund, through which the district
u uSnNs clear among themselves in
"aSnlngton it is said that such clear
fooe vs 70 date have aggregated $780,
e,g"oVO. at an expense Of about 81 900,
y winch are included the purchase
= necessary books, costs Of kilograms
""u other such items"
Nl'hough the federal reserve bin
"lle q law on December 90, 1918,
ae iirst payment Of capital was not
suFed until November ?, 1914, and
=" system was put in operation two
As thereafter. At the outset it
~ @ 'elt that discount operations and
~ ''nerclal paper in general were
s @ llfsl subjects to claim attention,
NV 'he board recommended that the
l.e hanks conflne themselves
n'y 20 short term. self-li -liquidatine
dn IN growing ont Of commercial, in
Atlai and agricultural operations.
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