The Birmingham age-herald., 1915-07-17

reported on September P of last year of approximately s25o,O0O00o.
 From one of the authorities associated
 Wlth the New York Clearing house a
 statement was obtained this morning "hlch shows the increase in the loans
 made by the national banks of New York clty since May 1 to July 10, the date of comptroller Williams latest report. This increase Is approximately s1OO GOO 900. I;
 from other parts of the country renorts
 nave been received by the comptroller
 Whlch snow that the national banks con
 tinue to increase loans proportinate to the
 increase since September 12 then it is
 reasonable to assume that the increa se
 In loans up to July 10 is approximately S4Oo'0ooooO, possibly little more
 There is only one interpretation of this
 increase, if the view of leading authori-
 tes In the financial district is correct. If
 points to steady, although gradual in-
 nation. There must have been some
 knowledge of this tendency gained by
 benJamin Strong, Jr, governor of the
 federal reserve bank for this district when he prepared the address which bf | delivered in June to the Bankers associa. 1 ton Which was assembled at Saratora springs. For Governor Strong then said that there was some danger of A riot ot 1 speculation and of inf1a tion although he
 was persuaded that the bankers of the United States and the federal reserve board Of Washington would be able to re.
 strain this disposition so that if would De kept within safe limits
 III March or this year Henry P Dayi- son Of J. P. Morgan & Co, ventured to say that the only danger to be appre. hended was imitation. He did not believe however that this was very great dan | ger since it was within the power of tbe bankers and the federal reserve hoard 1 partially, at least to overcome if Yet the authentic records now show that there has been since September 12 of last year an increase In loans, including the inerea SC made by the New York city national banks of considerably over s4o0, ,O0O, ,OOO curious state of mind is discovered to prevail among bankers respecting the meaning which Is behind this increa se The answer commonly made to the oues- tion is this; T don't know I can't ex- 1 plain It.. Of course, some increase in commercial demands has been made. but great aggregate increase does not re. l fleet the demands made by general busi- ness throughout the United States The presumption Is that the increase can be e'dNSN eo tbc iodllS WHICH the United | States has made to other nations and to the bankers of the beligerent nations. and yet men Of finance say that if this explains the increase in loans the fact should be | known by the bankers of the Tinted | States
 | There are apparently some extraordjnar ry nnanclai currents moving, but exactly in what direction the bankers who should know confess themselves unable to say. 1
 Visible Test
 No doubt those persons who are fort,,- | nate enough to be able to cash checks a, | the counters of national banks receivine bills of small denomination, have discov- I cred that a considerable proportion of
 these bills is represented by federal re- serve notes. Apparently gradually and very gradually national bank notes are | beginning to be retired and the time ma V come sooner than the public realizes when | the great bulk of notes which they receive | and carry around in their wallets is made
 of federal reserve notes
 If any one wishes to obtain federal re- | serve notes in exchange for gold or gold
 certificates, he need only to go to a fed era1 reserve bank and he will obtain In | exchange for his gold these notes but the | reverse of this transaction is impos sibe l in law He cannot obtain gold from a fed | eral reserve bank in exchcange for fed eral reserve notes. He mrct reach Wash l ngton in order to do that
 Another fact recently developed relates
 to the Aldrich-Vreeland emergency eur.
 rency. In theory the entire amount ex- | cepting a small sum which was issued by ! the treasury department at the time of | the great emergency in August and Sen. | tember, has been retired from circulation | So it appears upon the books of the Urea s. ury department. But there is still a large amount of this money in circulation | Banks which took out emergency currency | have by deposit with the treasury depart. ment of other funds theoretically retired the currency they took out, but in fact a l large amount of it got into general circu- lation, although it is gradually disappear | ing. As fast as the banks receive emer- gency currency on deposit they send it to Washington, but it may be a long time be- | fore it is actually retired. There are sev- | eral millions of fractional paper currency | issued in civil war days and for some years thereafter which have never | been retired and probably never will be | And so 1t may be with some part of the emergency currency notes.