The daily commonwealth. (Greenwood, Leflore Co., Miss.) 1916-1919, 1916-12-06
ANNUAL REPORT OF SECRETARY
M'ADOO AN ECHO OF PROSPERITY
Condition of Governments Finances Presented
to Congress Today Great Confidence in the
Future is Expressed
(By Associated Press)

(By Associated Press)
Washington, Dec. 6Secretary Nc.
Adoo's annual report Of the govern.
ments finances, presented to Congress
today, estimates that the fiscal year
ending June 30th, 1917, will show a
balance of $115,00O,000 in the general
| fund but that the figures year later
June 30th, 1918, will show deficit
in the general fund of $185,OO0,OO0.
Preliminary estimates place the
cost of conducting the government
| for the coming fiscal year 1918, ex-
elusive Of the postal service which is
| expected to be self sustaining and
other deductions at $1,278,021, 900.
The ordinary receipts for the fiscal
year 1918 he estimates at 1896, $780,
900, which. is s2s2, All 900 less than
! the estimated expenses.
Estimates of large expenditures for
national defense carry the estimated
outlay beyond income.
For the fiscal year 1915 now draw
ing to a close, the Secretary reports
great prosperity and expresses great
est confidence for the future. "Dur-
ing the past year." the Secretary says,
"the prosperity which set in so strong
ly during the fiscal year 1915 has
grown in strength and volume and is
now widely diffused throughout the
United States. Fundamental condi-
tions have never been more sound.
In all lines Of industry efficiency Of
organization and production have
reached the highest point in the coun-
try's history. General confidence in
the future, heaNhful enterprise and
development have been marked char
acteristics of the year.
"The financial strength Of the Unit
ed States-the greatest in the history
gives us commanding position in
world finance. We have been trans
formed from a debtor into creditor
nation. On November l, 1916, the
stock of gold coin and bullion in the
United States was estimated at ST.
zoe, 1885, ,976, an increase Of S714,597,-
SO4 in the past 16 months. This is
the largest stock of gold ever held in
theUnited States or in any country of
the world. Though the operations of
the Federal Reserve System and with
our abundant supply of gold as
basis, the credit resources of the Unit
ed States, have become more than
sufficient for home demand, and we
have been able to finance our great
domestic and foreign trade without
strain and to extend vast amounts
Of credit to other nations throughout
the world.
"The experience of the past two
years has brought into strong relief
the value Of the Federal Reserve Sys-
tem.lt is not too much to say that
our great prosperity could not exist
without it. The usefulness of the sys-
TEN has been broadened recently by
the amendatory act Of September 7,
1916, which renders it more attractive
to members and increases the scope
and services Of theFederal reserve
banks. Due to the transference of
value and other reserves to Federal
reserve banks, authorized by the orr
glnal act and amendment act, the re-
sources of said banks are now more
than $65O,00O,000, while the total re-
serves held are over $4O0, 1000, and,
In addition, more than $230, 100000 is
held by Federal Reserve Agents as
special security against Federal re-
serve notes. About one-fourth Of the
eountry's stock Of gold is thus mobil-
lied in the hands Of the Federal re-
serve banks and agents.
"Theincreasing strength and eff
cheney Of the Federal reserve banks
nave enabled them to enlarge their
direct service to the business COM
munity through the introduction Of q
definite and comprehensive system for
the par clearance Of checks through-
out the country. /
Rates Of discount OF Federal reser-
We banks have continued low through
out the year, and most Of their open.
market paper, consisting largely Of
acceptances growing out Of foreign
trade, has been below a 2 1-2 per cent.
oasis. Rates of interest throughout
the country have been reduced and
stabilized with great advantage to the
business Of the country. I
1T would have been impossible to
nnance our. vast domestic and foreign
trade without the facilities provided
oy the Federal Reserve System. Not
only has 1t met the normal and ex-
.raordinary needs Of business, but it
mas established confidence securely.
BUSINESS has been able to 80 forward
without apprehension and the several
crises which the country has faced
m it, international relations during
sne past two years have been accom-
panied BY no disturbances and have
caused not even q tremor in the finan-