davidaulloa/AmericanStories huggingface dataset:
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

aggregating 81, 1S6,7sS,4O0, was re-
ceived from 978,959 subscribers,
through 1,040 banks. The individual
subscriptions received by the Federal
Reserve Bank are included in these
figures as a single institution, but
these represented 6.19l subscriptions.
Practically 70 per cent Of the
total amount allotted had been paid
for by the end Of last June, or
within two weeks after the campaign
for the sale of the first loan was
ended. In other words, the total paid
for bonds without interest amounted
to S617,S3l $50, Of which S497,512,-
4jS had been paid by the end Of
June. BY July 80 an additional $53.-
l99,9s7 had been paid, and the re-
mainder, S611l9,203, was paid in by
September 20.
The report shows further that the
Federal Reserve Banks force han
died 4,005,G interim certificates. II
required 1891 $50 certificates for the
bank to make its deliveries. All Of
these separate pieces were handled
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

over what they can give to 1t. IL
il i'm this respect that their patriotic
impulses assert themselves. They
know that dependence for financial
success in the war must be placed
o. the Federal Reserve banks. The
question they now ask, as distln-
guished from that most prominent a
year ago. is not whether the Reserve
banks are strong enough to meet any
demand likely to he made on them.
but are they as strong as they can
be made?
The answer must be negative, be-
cause there arc upward of 10000
state banks eligible to membership
in the Reserve system which are not
members. The resources these banks
would contribute would increase the
strength of the Reserve system by at
least onc-third. More important than
that, however. is the fact that the
membership of these eligible banks
would increase the strength Of each
ere Of them 80 per cent,
Thus the banking strength of the
country would be vastly increased
ard the financial strength of the
government vastly improved. The
chance of winning the war within
a shorter time would be enhanced.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

obligation OF the purchaser OF a bill
10 know the credit standing OF
drawer and accepter or Of bank or
banker.
But the trade acceptance has plain
advantages over the open BOOK
account-the please charge it, sys-
TEN of the corner grocer's customer
applied to larger transactions. The
National Association of Credit Men
seized on the trade acceptance as the
remedy for at least half the troubles
o. their members. Their enthusiasm
for it finds justification in the
probable elimination of belated de
ductions of cash discount, of the
elimination Of claims for damages
and the return of goods as not salts
factory, and Of the variety of other
uncertainties that attach to collect
inp the amounts due for goods sold.
The National Association of Credit
Men. the Chamber of Commerce Of
the United States. and the American
Bankers Association have joined
forces i'm the selection of a Com
nittee of Nine. three from each or
canizatiou. to take up the case OF
the trade acceptance. and by deter
mined and concerted effort induce
various trade organizations to an
prove it and influence It's adoption
by their respective trades.
This committee has for its mem
hers, representing the United States
Chamber of Commerce, Lewis r..
PIerson. chairman Of the board, lrv-
ing National Bank, New York; Ed
win b. Heyes, credit manager, w.
e. J. Sloane, New York, and DR.. j.
7. Holdsworth, of the School OF
Economics, University Of Pittsburgh;
fer the National Association of
Credit Men. Kenneth B. Hooker, Gin
cinnati, Ohio; Frank II. Randel,
Philadelphia, and W. +. II. Koelsch.
Bank of the United States, New
York; for the American Bankers
Association, Robert II. fireman,
deputy governor, Federal Reserve
Bank of New York; George Wood
ruff. president, First National Bank,
Joliet. H.. and Joseph Wayne, jrr
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

ever, the par collection scheme IS not
working out with great success so
far as the volume Of the collection
business passing to the Reserve banks
is concerned. They are probably
doing about one-tenth of the business
and the collection business of the
banks under the old system has in
creased proportionately to the in
crease in general business.
The amendment to the reserve act
permits the Federal Reserve Board
bv regulation TO allow the banks
10 make an exchange charge not N
excess of ten cents per hundred
dollars. Not yet has such Il regula-
ton been made, although the amend
nent became law last June. Notn-
ing has deferred so many banks from
entering the Reserve system as the
conduct of the Reserve Board and the
Reserve banks in regard to collec-
tions. The subject was again dis
cussed in all its bearings at the cor
yention in Atlantic City. While the
hostility of the country banker to
par collections has not abatcd, 1T is
difficult for him to understand why
the Federal Reserve Board does not
issue the permitted regulations and
50 put an end 10 the controversy
Peace could be easily secured. Eric
ton will surely continue unless the
service charge for collecting checks
is authorized. The Committee of
Twenty-Five was continued as Com
mittee of Five. The war on this
phase of the Federal Reserve system
will find no abatement if the temper
Of the country banker does not
change, and there is nothing to indf
cate that it will.
No division Of the work Of the
convention was more interesting or
important than that of the Savings
Bank Section. Basil p. Blackett, the
representative OF the British Treas
ury in this country. related how
Great Britain has developed savings
rs means of financing the war. Tire
situation in this respect in that coun-
try is very different from the one
here. In England the savings banks
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
Federal Reserve Banks Shoulder Burden of Gov
ernment's Great Financial Operations
Work in New York District

Of banks, with the government and
the Bank of England as the two big
factors on either end. Here we have
to reduce this operation to the same
thing-to bookkeeping. You couldn't
take two thousand million dollars of
cash and pay It TO any one. whether
government or any one else, without
everything stopping. So that the
function of our Federal Reserve
banks is simply to run the general
ledger-to use a plain term, it is the
book of last entry where all these
transactions centre, and the ramifca-
tons of the bookkeeping operation
over a country with the immense eX-
tent Of this country and with the
tremendous number Of banks repre-
sent a very extensive operation.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
The Selling Organization Behind Liberty Bonds

pieces, of the $3.50 denomination
ll2,940 pieces, and of the $1,000 de-
nomination 316,l57 pieces. In other
words, 81 per cent Of the certificates
already issued went TO investors who
bought the bonds in amounts of $500
and less.
Forty-three certificates of $1,000
600 each were issued and 1,l94 Of
100000 each. There We're 1867 GER
tifcates in $4,000 amounts, 1874
in $4,000 amounts, and 1901 in
$4,000 amounts.
Payments for the 1898, 987.000 Of
the bonds allotted to the district were
made as follows: Cash, S200,22l, 1923;
certificates Of Indebtedness, S23S,-
1929; book credits. Sl55, SIS, 403.
Adding in the payments Of interest
made by subscribers, the bank was
able to transfer to the Treasury of
the United States a total of S594,-
756,9lj.
4 separate tabulation shows that
the total Of subscribers for the
bonds in this district was 97S,959, di-
vided as follows: Up to $4,000,
1854; s1O,05O to 100000, 1850;
$1OO,O5O to s250,OOO AIS; S25O,05O
and above, $40.
Another tabulation reveals the fact
that of the total allotted in the dis
trict the amount in default on Sep
TENDER 81 was S31 500. The expenses
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
Smaller Banks
More Responsive

Just what influence the entry of
the Guaranty Trust Company &C
New York into the Reserve system
viii have is problematical The
leadership of such a commanding iH-
stitution must not be underestimate,
but its entry was too belsted to turn
the tide; it is likely that the smaller
state banks Will be more responsive
TO other arguments and conditions
than to the action Of the biggest Of
trust companies. Tie dominating
reason that is moving the state-char-
tered banks is patriotism and the
desire to win the war. No class Ct
men knows better than the bank
ers the oyershadowing Importance
OF banking stability and financial
strength in times Ike the present.
The Federal Reserve system came
into existence as evidence Of the re
action against q banking scheme
which intensified, if it did not cause,
money panlcs. For a year or more
bankers viewed the system academi-
cally or as mere insurance against
storm. They were reluctant TO look
upon the Reserve banks as going in
stitutions which were al integral
part of the whole banking system
and which would have constant
transactions with their members.
The gigantic fiscal operations Of a
government at war have brought the
Reserve banks TO a position that they
might have been ten or twenty years
i'm attaining under conditions Of
peace. The Reserve banks are now.
in fact, an integral part of the whole
banking system. Their operations
aye watched with solicitude and their
statements register with precision
the condition of business and the
money market. For bank doing
a large commercial business 10 he
divorced from the system is a handi-
cap which is becoming constantly
more irksome. For a bank which
carries large deposits from other
banks, or is engaged in foreign bust
ness to any extent, to undertake IN
definitely to maintain a position Of
independence outside the Reserve
system is dangerous enough in itself.
but annoying as well as dangerous
to its own progress and development
when its neutrality-suspicious. ask what
provision it has made for supplying
them with currency under all circum-
stances.
However, the managers of the
state institutions seem really less
concerned now over what they can
get from the Reserve system than
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
PREJUDICE Of STATE BANKERS YIELDS TO PATRIOTISM

government, the general effect is M.
10 modify or help the savings banks
The effect OF the tremendous Dor.
rowings OF the government on u.
savings banks is grieyous problem
The diversion Of past savings, held ia
the form Of securities in these banyx
TO government loans would he frauyb,
with grave consequences. Liquids.
ton of these securities on a market
that has shown steady declines for
months il not TO be thought Of.
The savings bank men, therefor.
gave much time to the discussion o,
plans for the increase Of savings apd
the payment Of the subscription,
their depositors will undoubtedly
make for war loan bonds out of fut
ure instead of past savings.
In this respect they will have Tho
cooperation of the Treasury Depart
ment, which has the legal authorize
ton for the issue Of war savings Ger.
tiicates. The sale of these and u.
development Of habits Of thrift are to
be the particular work done during
the interim between war loans. In
the mean time the opinion is ey.
pressed that the savings banks will
be able TO get through the present
loan without diminution in their
deposits which will be harmful or
alarming.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
Weaving Business
From Ancient Customs

Both bankers and trade acceptances
continue to be as much Of mystery
T. many bankers as to many bust
ness men. The Reserve system chal-
legged business TO produce form of
commercial paper which would open
the way to the establishment of an
open market and give to personal
credit, in theory at least, the support
# goods and merchandise passing to
consumption. The Reserve act has
been tinkered to meet obstacles and
the campaign Of education TO wean
business from ancient customs IS on.
The obvious fact is that the trad :
acceptance, unless fortified by ship
ping documents covering title. is bet
tel than an old-fashioned promissory
note. So far as its credit quality is
concerned. only because it has two
names to it instead of one, and be
cause it probably bears on its face
evidence Of its origin in a bargain
ard sale of goods. A banks proper
tion Of losses from commercial paper
OF any kind is insignificant. but the
present desire is to produce some
thing which will bear scrutiny in
strange places and comply with the
requirements of the Reserve banks
as TO rediscount at least in the mat.
ter Of form.
BY many students of the subject
the trade acceptance is regarded as
a step in the progress toward greater
development of the bank acceptance.
The credit of individuals, Of course,
varies and the credit standing Of
banks also varies. No form of
acceptance. therefore, changes the
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

most interesting developments Of the
extraordinary six months period dur
ing which this nation has been at
war.
Bankers refuse to speculate on
what might have happened If the
Federal Reserve System had not been
in existence and in good working or
der when the United States govern
ment suddenly found itself con-
fronted with the necessity of raising
money by the billions of dollars for
war purposes.
Might as well try to say what
would happen if the sun stopped
shining" is the way one Of the lead
ing fnanciers in Wall Street parted
the question.
Benjamin Strong, ill., governor of
the Federal Reserve Bank of New
FORK. put it this way;
There are $1,000 banks in the
United States. In England, | think,
there are about go or 270 CONNER
cial banks. England has put through
immense financial transactions in
connection with the war without any
serious money disturbances because
rs machinery is so nicely balanced,
all centring IN London, that every
thing is reduced to bookkeeping.
Cash does not pass. In other words,
IL IL amanninc credits ON the hooks
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

These transactions all centre in these
twelve Reserve banks, and they keep
trimming the boat all the time, so
that the money conditions are kept
level. How it could have been done
without the Reserve banks | really
don't know. ! really don't STE how it
would be possible. OF all the things
that happened to this country in con-
nection with the war, to have this
machinery ready is certainly as fort
innate as anything
An idea of the stupendous effort
involved in the present campaign 10
sell Liberty bonds is gained from
report just issued by the New York
Federal Reserve Bank on the COM
pletion of the work done in connec-
ton with the first war loan. The
bank finished its labor on September
. last. The total allotment in this
district, the report shows, was $685.
9S7 600 of the bonds, in addition to
which the bank furnished by special
allotment S23,S44,650 to subscribers
whose banks had failed 10 file sub
scriptions in proper form.
OF the S2,OOO,OO0,0OO issue, there
fore, a total of s6l7,s3l, $50 was dis
tlibuted through the Federal Re
serve Bank in this district, or almost
81 per cent of the entire issue. The
It'll nf snhsc ri ntions IN TIA d;stric.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
Country Bankers Wrath
Over Check Collections

At it's convention in Kansas CITY
in 1916 the American Bankers Asso-
citation appointed a committee Of
twenty-five, whose duty was TO un-
dertake to secure such a revision OF
the Federal Reserve act as would
eliminate what is known as the sys-
TEN of par collections in operation
through the Reserve banks. The re-
cult of the effort was partial fail
ure. The country banks were greatly
incensed over the scheme 70 deny
them exchange charges on checks
which they were called upon to pay
in distant places. The fact that the
Reserve banks pay the cost of ship
ling currency in the payment If
such checks, where such shipment IS
necessary, has not mitigated the
wrath Of the country bankers. How
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
president, Girard National Bank
Philadelphia.

president, Girard National Bank
Philadelphia.
Bankers are probably as much IN
need of information as to the merits
and advantages of acceptances as
business men engaged in commercial
pursuits. The forms Of negotiable
paper are trade rather than banking
customs. but the banker is the mai
arbiter of the form if the paper is
offered 10 him for sale. He Is more
than likely 10 be called on to explain
any departure from old habits and
the reasons for it. Many of them
have investigated, experimental with
and approved the trade acceptance,
II has been found, under practical
test. TO reduce capital requirements,
simplify the collection process, sub
stitute certainty for uncertainty, I'M
prove the financial situation by IN
creasing the amount OF paper ellgioie
for rediscount at the Federal Re
serve banks, and one banker was
frank enough TO say that it promoted
sleep and peace Of mind. But the
evidencing of a trade by an accept
ance does not raise the resulting
document above the credit level OF
Il q men whose names appear on it.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

at least five times. There were unis-
sued, cancelled and returned 1884,
GAL certificates, and the bank also
had on hand l,789,O5O full paid GER
tiicates which had not been issued
at the close Of business on Septem-
Der 81.
or the 1881 .666 certificates issued,
9l6,l75, or almost 80 per cent, were
in the $50 denomination. OF the 500
denomination there were 562,6l2
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07

! of the banks bond issue division in
handling the loan were only S90,906
of which s54,l56 was paid in sala-
ries. The greatest number of clerks
employed at one time was 234, di.
yided into nine departments.
The banks forces have been in
creased TO about five hundred en-
ployes TO carry on the work in con-
nection with the present Liberty
Loan campaign.
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
ARKETING Liberty bonds in
blocks of S3,00O,OOO,O0O or
more calls for a selling OF

gaHization Of the first order. 1t
calls for a financial machine big
enough TO keep the banking re
sources Of the country in balance and
avoid disturbances that might result
from transactions Of the magnitude
Of those now being carried on by the
government.
How the twelve Federal Reserve
banks throughout the country have
been expanded almost overnight into
great agencies for the sale Of war
bonds and the Federal Reserve Sys-
TEN as q whole has provided the ma
chinery 10 finance the payments for
these securities present one Of the
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
A Development OF
The Reserve System

Inc fNcSc1Nc CyStCll
The banks could not attack this
conclusion which forced itself upon
them. The State Bank Section, with
over 1000 state banks enrolled rs
members. was supported by the
Trust Company Section Of the ssso-
citation in joining with the National
Bank Section IL plan TO bring
every eligible bank into the Federal
Reserve system. To supplement the
whole plan the general convention
OF the association authorized the APP
Dgiutment Of a committee Of five,
{, be known as The Federal Reserve
Membership Campaign Committee
This committee is charged with the
duty Of conducting an active cam
paign to bring into the Reserve sys-
tenn all eligible banks which are not
now members.
There have been developments of
the Reserve system in practice which
are opposed 10 some Of the most
cherished ideas of the men who
framed the Reserve act. The reserve
banks as practical working institu-
tons and the Reserve banks as con-
ccived by Congress are not exactly
/ the same institutions. There is much
further development to come, and
some changes in policy, method and
attitude are desirable, but most M
t.-esting is that diversion in prac-
tice which must leave the baiters Of
the fctional money trust gasping for
breath.
There was very good reason,
wholly apart from hostility TO specu-
lative enterprise, for denying the Re-
serve banks the right TO make loans
against the collateral of stocks and
bends. Never was anything finan-
c.ally more ridiculous than to base
a commercial banking system on the
fuctuating commodities dealt in on
. the Stock Exchange. But the legis-
/ lctiye promoters Of the Federal Re-
serve act were not no anxious to cor
, rect that fallacy as to smash Wall
Street and what they invariably re-
parded as its unholy operations.
Tney decried the adyisability of max
ing any loans whatever on such col
lateral security as the Stock Ex-
change listed. There was no room
Tor argument, and when Representa-
tive Henry told Of the iniquities of
5peculation there was not q dry eye
in the committee room.
, Practically the money market is
The rroduct Of and is Influenced by
olj KINDS If business activities. These
activities infinitely varied. cannot be
considered individually and in isola-
rio, Tbo;r differentiation and re-
action. one on another. constitute an
undividable whole. If the Stock Ex-
Change is affected adversely by any
serious change in conditions. bust
ness feels it instantly. lust as the
fluctuations in business activity re-
Get 10 affect the operations of the
Stock Exchange. The Stock Ex-
change has then to be considered as
a factor of conspicuous influence and,
as a matter of fact, it is so consid-
cred by the Reserve Bank officials.
But if the Reserve banks, and par
ticularly the Reserve Bank Of New
York, are charged with the duty Of
guarding the money market, they
New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-10-07
By a. D. Welton.
THE annual convention Of the
4 American Bankers Associa-

American Bankers Associa-
ton at Atlantic City brought
to view the more serious questions
with which bankers are confronted
and. TO some extent, effected a
Capitalization of sentiment. The
translation Of the plans approved
into action is a matter intimately
related to this disqualification of sem
timent, but customs and practices
long subscribed to by bankers and
business men yield slowly to change,
and arbitrary methods, reSorted 20
in an effort to secure haste. are more
than likely TO cause further delay.
The war has been a great solvent
Of economic customs. All rules are
down. Traditions and precedents
have been discarded. Innovations
are accepted as a matter Of course
ard experiments are often acceded
&c even when they assault sound
judgment. Many Of the experiments
ere doomed to failure. Much that
is experimental must he regarded as
an incident in the process Of elimina-
ton under the development of which,
1t is assumed, only the fit will sur
vive.
Of the problems which came TO the
surface at the bankers convention
for discussion and elucidation that
of the relation Of the state banks and
t1ust companies TO the Federal Re
serve system was not the least i'm
portant. II is a subject as old rs
the arguments over the Federal Re
serve act when it was first under
discussion, but it is now viewed from
on entirely new angle. What was
said in the programmed discussion
behind the footlights, and before
them. was less interesting and less
significant than the private views
freely expressed by dozens Of bank
ers who are in command Of insttu-
tons holding state charters. In pub
lie bankers have almost uniformly
indorsed the Federal Reserve system
and extended assurance that All
banks should be members Of it. IN
private there has been a variation
Of opinion and much of it was to the
effect that the membership Of state
banks was unnecessary and II was
desirable to have a system Of banks
which would not be subject 10 the
regulation of Federal authorities or
he enmeshed in the politics which
naturally results from that form of
regulation. At Atlantic City there
was plentiful reiteration of the cd
arguments. about the greater free
dom enjoyed by the state banks, but
it was also usual to hear the very
man who uttered these arguments
knock them over with the remark
that things are different now"