Evening star., 1919-05-11
BY I, A. FLEMING.

When the compilation of the returns
of the next call made by the con
troller of the currency has been COM
pleted they will show more money
in circulation in the United States
than ever before. Nor is it anything
more than natural that the wealth
of the country should increase as the
years go by. following upon the period
of the highest productive activities
of the industries of the nation. with
the highest wages current and with
the highest prices on record for the
commodities produced.
Moreover. the crops have been rec
ord breaking and the prices therefor
also.
In the last three weeks we have
had the phenomenon of million-share
days on the New York Stock EX-
change and a S4,500.000.0o0 lloerty
loan campaign on at the same time;
with call money in New York around
5Is per cent. and time money, almost
any length. at per cent.
Verify the federal reserve system
has been tested and las been found
not wanting, for il has met every de-
mand of peace and war Lnd is aole
to go on meeting tn, ..mands as
fast as the exigencie, No one
fears panic. even witt. highest speed
activities. and just at the end OF the
most expensive war in the history
fears a setback, even with highest speed
ever
With the victory liberty .oan notes.
about So. 200, 900. 900 to S22,000.0OO
900. 900 of government obligations
have been fioated in considerably less
than two years. Aside from the loans
TO allies. much of this money has
been expended in this country. III
deed most of the loans to allies were
in the nature of credits for purchases
in the United States.
4 large part of these liberty bond
issues are today functioning as
money. not only through the ready
ability of the owner to purchase al
most any commodity with the bonds
or notes at face value: to make de-
posit as a bond with the government
for contracts. or in any case where
Congress DEGREES that a bond must be
fled, and last. but by no means least,
as actual money through the use by
banks of the rediscount privilege
with the. regional banks of the fed
eral reserve system.
The federal reserve note issue is not
limited to the purchase of govern
ment 2 per cent bonds. of which not
more than s25,000,000 can be pur-
chased in any one year, but notes,
that is currency. may be issued when
secured by an equal amount of pa
per accepted for rediscount or pur
chased by gold or gold certificates.
and by first lien equally with circu
1ating notes. secured by United States
bonds. on all assets of issuing bank"
Any member bank in good standing
may offer it's own or its customers
notes. secured by liberty issues to 105
per cent of face value of loan to any
amount. Thus the liberty issues func-
tion as actual money-and swell the
medium.
January, February, March and April
are the best saving months of the en-
tire year. After the reckless but
expenditures of the
holiday season, comes the period of
financial irecuperation. This is an
other reason for the plenitude of
cash at this time.
"The Federal Reserve Act"
This, is the title of a volume Just
ISSUED by Robert L. Owen. late chair
men OF thesbanking committee of the
United States Senate. in which he dis
cusses at length the various great
failure of the national bank
ing act to give the nation an elastic
and al. the same time a safe currency.
and the efforts of himself and other
to remedy the evil.
The history covers the legislation
that produced the Aldrich-Vreeland
currency measure; the
amendments Of 1914 to the reserve
law; the suggestions of the United
States monetary commission and the
bill which 1t offered for a National
Reserve Association" with the central
bank idea. and Washington as the
head office, etc.
Senator Owen was one of the
stanchest advocates of the federal re-
serve law, stood sponsor for it be-
fore and after passage. and has. by
wisdom and careful. continued study
OF financial problems. suggested sew
eral needed and exceedingly useful
amendments, several of which have
been incorporated in the law.
Tho discussion of various suggested
legislation. the study of foreign
monetary systems and the publica-
Efon in it's entirety are the work of
enc who played a large part in the
solution Of the currency problem in
the United States-a fact in which
senator Owen takes a pardonabl
bride.
I Public Utility Situation.
There are 273 cities of more than
$4,000 population in the United States.