The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1921-10-22
PRAISE OF SYSTEM
Federal Reserve Banking Sta.
bilized Currency.
E. L. Copeland in Talk Before
Railway Society in Chicago.

The establishment of the federal re-
serve bank system by the United
States government stabilized currency
and made it possible for American
business men to finance most lines of
endeavor at home and abroad during
the war. according to a statement
made by E. L. Copeland, secretary and
treasurer of the Santa Fe railroad, in
an address before the Society of Rail-
way Financial Officers in Chicago last
night. Copeland, as presideRt of the
organization, delivered the annual adj
dress.
THE tremendous growth of our in
dustr:es during the war period, ana
the increased agricultural production.
brought about what has been called
an initiation of currency, but which, in
fact, was an initiation of credit he
said. when you consider that 50 per
cent of the business of the world IS
handled on credit. such as exchange.
checks. drafts, and bills of ladinS.
YOU Will readily understand that any
initiation which affects the value along
commercial and manufacturing lines
of business naturally would affect
credits. Now this initiation not only
caused an increase in the value OF
manufactured articles and all prod
ucts of the field and farm, but also
increased wages.
Just as long as a large volume of
domestic and foreign trade continued.
business seemed to prosper and the
railroads were getting their share OF
the prosperity, but when the purchas-
ing power of the foreign countries
commenced to wane and exports were
reduced in volume, a depression oc-
CURED in all lines of trade and defia-
ton was commencing to be felt. I'm
fortunately the market for the prod
IDf- nf foy n
prices dropped, but wages, which had
been advanced during initiation, were
not reduced under deflation tC a cor
responding degree. This very uneven
adjustment caused a retrenchment in
all lines of industry in the matter Of
production.
Business Shows Decrease.
1.-THE early part of the year we ex-
perienced a dropping off of a large
volume of business and almost every
railway treasurer found himself in an
embarrassing position of not taking in
sufficient receipts to take care of
operating expenses. 1 do not recall
that we have ever heretofore passed
thru a period wherein the relations
between railroads were so strained as
during the first six months of this
year. 1t was practically impossible
for the lines to pay their interline bal
ances, or settle current bills at the
proper time.
Owing to the financial strain which
prevailed over the entire country and
seriously affected all lines of business
the scope of the treasury officer was
considerably enlarged for the reason
that he was dealing with the shipping
public in the collection of transporta-
ton charges and was necessarily COM
PEELED to adopt elastic methods to
meet the varying conditions in the eX-
tension of credit. The money market
frightened and almost every industry
was compelled to reduce it's working
force for the reason that there was
no advanced market for sale Of it's
products. 1t was a question of reduc-
ing the production to meet the small
number of sales, or else close up en-
tirely. 1t was necessary for the treas
urer to use his best Judgment in deal
ing with patrons owing the railroads
so as to avoid disputes or delays and
at the same time maintain the credit
of his road by securing funds needed
to make periodical settlements and
partially satisfy creditors.
Much Work To Do.
I'm the establishment of bust
ness to a normal economic condition
the treasurer of a railroad has had
a large share Of work to do. He has,
as credit officer, secured the conf
dence of the public by his fair deal
ings with patrons. He has adopted
methods of protection for the funds
of the carrier, as received at the vari-
Gus stations and offices, against the
uncivil demands of the hold-up artist
and the burglar. In his disbursement
OF funds he has protected the COM
pany by adopting forms of pay-checks
and bank checks which would betray
the raising of the amount and prevent
the use of a counterfeit. He has made
it possible for the employees to secure
the cash on wage checks without ex-
pense. In other words, the treasurer
has met the unusual conditions with
out fear or favor, and has maintained
his fidelity to the interests of the pub
lie, the employees and the owners Of
the roads