The Birmingham age-herald., 1917-10-16


 reserve board.
 In statement made public through eligible nonnember state banks and serve system without further delay t to the consolidated gold reserves of t "a vigorous prosecution and successful
 Scores of such institutions have flocked to system within the past three weeks among them some of the largest trust companies of New York, Philadelphia and other cities. The movement to the fed eral reserve system has lacked only q final impelling force to assume the pro- portions of a land slide. Within less than three weeks, resources of such institu- tions in the system have risen from S1, ,6o0ooo to more than s2,soo,ooo,ooo.
 LIBERTY LOAN FINANCING
 Liberty loan financing. the resultant activity in the money markets, the effect of the governments huge financial trans actions upon the bond markets and the stock exchanges ot the country lave made it imperative, in the view of the administration, for the federal reserve to control not a major traction of the gold reserve of the country. but the entire amount The recent embargo on gold ex- ports has made it highly desirable that this control be acquired as speedily as possible.
 RESERVE WATCHING
 With the board in active, daily control of the country's huge store of gold, at present more than $3.0O0,oo0,o0O, watching every avenue through which 1t may De lessened and vigilant in it's supervision of the countrys banking activities, off cials believe that the financial position of the country may be rendered as nearly impregnable as human skill can make it.
 At present the board controls the ac- tivities of institutions representing only one-half of the country's total banking resources. The latest report of the comp troner of the currerGv piaces at seyera millions above s1s,ovpvooooo the rese4 e' of fi,e bat.sss v,itnin4 tl1@ s7-stern. ST ct that report was issued howes..s Tesa'i' s1 800 900, 600 in resources have been added through, the acquisition of new members
 PRESIDENTS STATEMENT
 There are. however between 5000 ane 5000 eligible banks and trust companies with resources estimated at from slzV0u'- coo GOO to s16oo0, ,o0o,ooo, whose activities are entirely beyond the control of the red eral government being governed only py state laws. The President addressed him- self to these institutions. His statement follows:
 ''The White House.
 ..1t is maaIfestly imperative that there should be a complete mopiiiza- ton of the banking reserves Of the Tinted States. All who are familiar with financial operations must appre- ciate the importance of the developing to the maximum our banking power and of providing financial machinery adeouate for meeting the very great financial requirement imposed upon our country by reason of the war.
 "A vigorous prosecution and satis- factory termination of the war will depend in no small degree upon the J ability of the government not only to finance itself, but also to aid the gov ernments associated with it in the war, which must be kept supplied with munitions, fuel. food and supplies of all kinds.
 BANKING PROBLEM "The banking problem involved is one which concerns all banks alike It's solution does not depend upon the national banks alone, nor upon the state banks The burden and the privi. lege must be shared by every banking institution in the country. The impor tant functions of the federal reserve
 banks in the sale of the government securities. in receiving and trans 1 ferring the billions of dollars in volved. in supplying credit facilities and in protecting the reserves of tn. country have become so familiar to al that l am sure it is unnecessary t dwell upon or expound them.
 The extent to which our countr l can withstand the financial strains fo which we must be prepared will de pend very largely upon the strcngti and staying power of the federal re serve banks. The federal reserve ac 1 is the only constructive financial leg l islation which we have ever had whicl was broad enough to accommodate q the same time banks operating undc powers granted by the general gov ernment and banks whose charters ar, granted by the respective states. Tn, unification of our banking system ant the complete mobilization of reserves are among the fundamental principle of the act
 "The state banking institutions fo some reason have until recently scene inclined to hold aloof Congress a fe, months ago prescribed very Eenerou terms for the admission of the sta. blanks into the federal reserve systey which have removed the objections here l tofore raised by state banks when co. l sidering membership. As the law no stands, 1t leaves member state banks an trust companies practically undisturbe 1 in the exercise of all the banking DON CTS conferred upon them by the state
 The law provides also in definite tern the conditions upon which any state ban or trust company may withdraw fro 1 the system.
 Many of the largest state banks ar trust companies are now becoming men bers, realizing that to win the war v must conserve all of the physical an
 moral resources of our country, that ot finances must rest on the firmest poss \ ble foundation, and that they must adequately and completely conserved s as to respond instantly to every lexit
 zaata demand. How can ttis neceSsal