Evening journal., 1919-05-01

the strain? Not a BIT OF Il. The banks
OF the country never rendered a higher
and further measure OF service on the
one hand and on the other they never
experienced such a period Of prosper
iiy. Notwithstanding the great demand
for money at maximum rates or inter
est. deposits acmally increasedsio sup
port the expanding loans ana banks
generally grew In resources and IN
creased earnings. How was this an ac-
eompllshedg Fortunately, and lt seems
20 me almost providentlally, the Fed
oral Reserve system came into opera
lion in the fall OF 1914.
.'The old order OF things, under
which each banking Institution was a
separate and distinct unit dependent
wholly upon us resources, in time OF
great stress. was supplanted by The
new order, the underlying principle OF
which Is collective cooperation througll
a group OF district reserve banks To-
Gated at convenient financial centers
throughout the country
Every national bank was by the
act made a member OF the new system
and very soon after rs installation, IN
stlmuons operating under State char
tors were invited into memD 'rship
upon most liberal terms.
"The new organization had gotten
fairly well on It's feet and comfort
ably under way before the United
shtes entered the war. Then at that
crucial period. through fs excellent
organizaiion and well working ma
chinery the gold resources and the re-
serves Of the country were modified,
and by the Gu tellm nj Of s0-called
non-essential credits, were made 20
perform the maximum OF service In the
financing not only Of the needs OF
America but OF our Allies as well.
"The S cretary OF the Treasury a
few days ago made the following very
apt comparison: The whole startling
contrast between the old system and
the new. may be summed up IN the
single statement that IN 1907. under
the old system, the failure Of two
hanks In New York City preclpiiated
the greatest financial panic that ever
afflicted the nation, whereas. under
The new system the greatest war Of
recorded history failed 10 create a rip
pie OF alarm IN tho banking commu-
nifty Of The UNIFIED States.
influence Of Banks.
throughout this entire war pro-
gram the officers OF the Federal Reserve
banks have been IN position to WELD
much influence In the determination Of
matters financial at Washington. Par
tally, 40 least. IN consequence OF thcir
insisience, the Treasury Department
has wisely pursued a policy Of great
liberalty towards the banking instiiu-
tions cf the country. In return for
The splendid support they have gener-
ously given at an times. the Treasury
program was so aransed that the pro-
cess of handling the government
finances were made quite profitable TO
the banks and the greatly increased
earnings OF The war period are in no
small measure attributable 10 this.
Then. Ia rs turn The Federal Reserve
bank has endeavord TO extend every
facility 60 It's members whose insti-
tuition 70 is, so That where borrowing
has been necessary 1t has been done at
advantageous rates,
This war period has increased the
growth OF the Federal Reserve Bank of
Philadelphia from an institution with
resources OF Scje5l,0OO TO approximate
ly S500,O00O00 with a working force
from 50 90 $50 men and women
Most Of the larger State Institutions
have become members or have appli-
cations for membership filed await
ing action OF The authorities Il seems
scarcely necessary for me 20 say that
In my judgment. not only the patriot
lc duty, but The very element Of self
protection and Advancement requires
that an eligible state Institutions
should become a part OF this rapidly
growing and very helpful system. To-
gelber, The member Institutions and
the Federal Reserve banks have wealth
cred lhe stress and strain OF the exact
ing requirements OF the war in splen-
dld Nshlon until now we are in the
midst Of The last great Liberty Loan
campaign. the NTH and final Victory
Loan, somewhat smaller In total amount
that we had expected and IN short term
notes at liberal rates Of interest.