The Birmingham age-herald., 1916-02-01
OVER EXPANSION IS. LURKING DANGER IN OUR INDUSTRIAL LIFE Warburg Much Gratified at First Years Operations
 of Revenue System NORTHWEST TAKEN
 AS BEST EXAMPLE District of Which Minneapolis Is the Center Has Made the Most
 Practical Use of New
 System
By HOLLAND

New York, January 3t.-(Special) )-Paul Warburg of the federal reserve board is said by his friends to have given counsel to the Credit Mems association of New York in an address, delivered a few days ago, which reflects the views he has pri- vately expressed to friends respecting the Ane lurking danger in our industrial life. 1t is not view held exclusively by him. Henry P. Dawson of J. P. Morgan &, Co.,, intimated six months ago that if there were a general revival of business, then the only danger which might Turk in that situation would be that due to imitation and overexpansion. MT. Davison was in Clined to think that the federal reserve banks and other bankers would be able to repress disposition of the kind, ad- hitting, however, that if it got full sway the banks could not control it.
 MT. Warburg made a concrete illustra- tion of what he meant when he spoke of the possible danger of overexpansion by saying that there might be temptation to which the managers of American in- dustries would yield greatly to increase their plants, not realizing that possibly after the end of the demand represented by war orders a considerable falling off in orders was likely, and that it could not be regarded as certain that this loss in orders would be made good by an increase in demands from our domestic industries and trade.
 MT. Warburg is understood to be much gratified with the manner in which the federal reserve system has in the first year of it's life met it's responsibilities and shown itself equal to it's opportunities. He knew what many in the very populous and very active industrial sections have not clearly understood-namely, that per- haps the best recognition of what the fed eral reserve system means to the farm CTS to the tradesmen and to the indus trial managers of the United States has come from those whose vacations are in the great agricultural districts, particu- larly in the far west and the northwest There popular interest in the workings of this system and in it's relation to their own needs has seemed at times to be greater than any interest displayed in the European conflict. That may be because those who live in these remote sections of the country are not brought into close touch with conditions created by the Eu- ropean war.
 VAST RESERVE DISTRICT
 The federal reserve board at Washing ton is understood to have been especially interested in the relations of the ninth federal reserve district to the people who live in that very great section of the country. One state, Montana, in that section contains a little under 150,O00 square miles. The two Dakotas contain about 150,000 square miles. Minnesota numbers almost twice as many square miles as does the state of New York, and that part of Wisconsin which is in sula of Michigan contain together about 5000 square miles, somewhat in excess of the area of New York.
 Here, then, is a total of 496,000 square miles, all of which is contained in the ninth federal reserve district. From east to west it is approximately as far as it is from New York to Omaha and from north to south it is apout 600 miles in length.
 Some in New York who have conversed informally with members of the federal reserve board have learned that in many respects this district is regarded by the board as furnishing one of the best tests of the adequacy of the federal reserve system. The section produces large amounts of copper and iron, also lumber. The dairy industry is an important one so Is the grain growing industry and one