Every evening, Wilmington daily commercial., 1922-09-20
SUB TREASURES ABOLISHED
BY Frederic j. Haskin

Washington, Sept. 20.-The Federal
Reserve Banks have completed the
taking over OF the functions of the |
Cf the United States
and the Independent Treasury has be-
come n thing Of the past. The Federal
Reserve Act authorizes the Federal
Reserve Banks 10 act IA fiscal agents
of the United States and they have
been able to handle this business so
thoroughly that the abolition OF the
b-Treasurles has been made pos
slblc.
The Sub-Treasurics were created In
1s4G following the long series Of difii-
culties which Andrew Jackson and
other officials OF the early government
had with the Bank OF the United
Stntes They we're branches of the
Treasury at Washington and were de-
signed to handle government business
in various parts Of the country. The
Sub Treasures were located at
strategic points geographically.
With the growth Of the banking
business IN tho United States It was
found that the system set up IN 1896
did not answer the demands of mod
ern commerce. The Federal Reserve
Banks which are qunsi- governmental
organizations. did meet this demand.
go the change was made.
! Tho twelve great banks are direct
agents Of the government and. with
their twenty-three branches. render
= service which Is declared TO be su-
perior 10 that possible through the
old Sub-Treasuries.
Under a general power furnished by
the Secretary Of the Treasury, the
Federal Reserve Bank may accept
government revenues and hold them
on deposit. pay checks. and warrants
Of the Treasury. redeem bond and
note coupons and conduct a general
banking agency business for the Fed
eral Treasury. Any government
check or warrant. no matter where
drawn. may be presented to any Fed
eral Reserve Bank or any one Of the
branches for payment and payrnen
viii be made as readily as II the checl
were presented at the Treasury d
the United States.
War Business In Bonds.
The Federal Reserve Banks go
deeply into this government bankini
business during the war As fsca
agents. they handled n large par
of all the selling of the Liberty Bond
and Victory Notes. This service wa
not confined to the actual bankinl
lalone. The Federal Reserve Bank
were the headquarters for the pub
liclty campaigns which assisted il
, placing the securities.
The magnitude Of this business
I shown by the figures. During tn
. war the Federal Reserve Bank
. handled the subscriptions and pay
!, rnents. distributed the bonds and keI
. the accounts of an aggregate Of s21
: 900 000. 900 represented by more tha
:, SO 900 900 subscriptions, During an
: since the war. the Federal Resery
Banks also handled for the Treasur
!, the short term securities known q
Treasury certificates OF Indebtedness
The sale and distribution OF s36. 600
!, 900, 900 Of these were handled and II
, subsequent redemption Of s32,000,000
900.
There Is vast amount Of detail
. performing this sort Of work an
% Treasury officials and bankers agrs
that If the task had fallen on the o.
= Sub-Treasuries they would have bee
D. swamped.
l. The Federal Reserve Bank Of Ne
York Is the greatest Of the twel'
* banks. In fact in many respects it
as great as all the other eleven p
J. together In that It does about half
e. the Federal Reserve banking of Z
rs entire country. An indication OF I
N bulk of the Federal Reserve Bal
ne operations is furnished by some
g the figures for the New York Bar
ne For the year 1921. that bank handl
ne government checks to the amount
OF 81 ,63S, 900 900. The twelve Fedel
%. Reserve Banks, their twenty thr
a branches and the Treasury and Fe
c. eral Reserve Board at. Washingt
ne are all connected by a private te
as Fgraph system which keeps them
at constant touch. Through this 5.
es TEN, the New York bank in Is
e. transferred by telegraph s1.22o.00
by 600 in government funds. Cover
in ment bonds and notes were convert
and exchanged 10 the extent Of 1858
000,0O0 and Treasury certificates
Indebtedness and short term no
were sold by this bank 70 the exte
of s1,4S1. .O0O.O 900.
All this, in addition 10 many oti
routine services, was performed
the government at a cost of s5l
74S. a negligible item in cornparis
with what 1t would have cost.
Treasury 10 handle this vast volu
of business direct.
All of the banking functions of
old Sub-Treasuries now have be
taken over by the Reserve Banks q
the former have been wholly aboli:
ed. But one function was ommitted q
that not of an active banking natu
This consisted Of the storage of
metallic reserves of the Treasur,
the gold and silver security for
circulating notes of the United Stat
This coin and bullion was transfer
directly TO the Treasury at Washii
ton and it repoSes in the vaults the
To transact this enormous bank
business the Federal Reserve Bar
require capacious quarters and la
working forces. The work is not
heavy as during the war, but it
A. heavier than 1t was IN the days WI
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