The Manning times. [volume] (Manning, Clarendon County, S.C.) 1884-current, 1922-02-22
PREDICTS UPWARD
MOVE IN BUSINESS
Reserve Board Rcport-Ncw Era of
Prosperity Will Follow Revival.
Says Statement.


Washington, Feb. 21--Business
throughout the country, progress
ing through well defined cycles, is
nearing the point of the upward
swing of the economic pendulum,
according to the annual report of
the Federal Reserve Board trans
mitted today to Congress.
."Thcrc are those" the report
said, "who believe that the begin
nlng of revival is not far distant.
When it does definitely set in it
Will be followed in due course by
new era Of prosperity"
Business, in one of it's "lonp
swings" from prosperity, the report
said' has followed its usual rota-
ton, which it described as, "busi-
ness activity and increasing pro
duction, excessive expansion and
speculation, followed hitherto bv
panic and forced liquidation; long
period of slow liquidation, business
depression and stagnation and then
! revival. In the light of recent cx-
perience," the report warned, "wc
should remember, when we again
enter into period of full pros
perlty, that reaction will follow
sooner or later, and if the flow of
the incoming tide can be controlled
SO that the crest may not be reach
ed too rapidly nor rise too high the
subsequent reaction will be less
severe and the next period of in
dustrial and commercial activity
and general prosperity will be
marked by sancr methods, greater
achievement along constructive
lines and by longer duration
than any which we have had be
fore"
The board confined it's rcpor. TO
an account Of the operation Of the
organization for the year 1921,
without offering any suggestion
for legislation affecting the board
or the federal reserve system. The
earning assets of all federal re-
serve banks, the report said,
amounted on December %, 1921, to
81 ,535 1851 900 compared with So
263,027, 900 on December 80, 1920,
reduction of $1,727,176,000, or So
per cent and reduction of ST.
S8G, 900 or 55 per cent frcm the
high point reached ON October Is,
1920.
This reduction in loans, tho re-
port explained was accompanied
by Il steady increase in gold re-
serves and an almost con. .nuous
reduction in federal reserve note
circulation, the loan reduction con-
tinuing despite substantial decline
in discount rates.
Gross earnings of the federal re-
serve banks for 1921 The rrcolL
continued, amounted to SIP ,H6:,.-
600 compared with $l8l,297,0 ,0CC in
1920 the falling off in earnings
being due to decline in the volumc
Of rediscounts had reductions in
rcdiscount rates. Member bank
borrowings according to the report
showed q continuous decline from
S2,G87 100000 at thc end of 1920 TO
about $l,141,000,000 az the end Of
1921, due to a rcduct on Of ovr'
$4,000, 900 in the volume Of fed,
! cral reserve notes in circulation,
caused by lower price levels and
/ by net imports Of gold amounting
to SGG7,unO0,0oo practically all OF
reserve banks.
/ As IL franchise tax the Federal
Reserve Banks paid into the treas
! ury $50 ,974 900 for the year 1921.
On December 2S the report con
/ tinued, the Federal Reserve Banks
held a gold reserve Of $2,S7O ,0OO,-
, 600 and Il combined reserve against
member banks deposits and note
issues Of slightly moro than II
per cent if the legal minimum re-
! serve Of 35 per cent could be set
! up against deposits, the report
! added, there would remain q gold
reserve of more than 81 per cent
against federal reserve notes in
! circulation.
"For some months past" the re-
| port said, '"thcrc has been mark
ed easing in domestic rates Of in
tcrcst. Notwithstanding some un-
favorable features in the revenue
| laws, the investment market is now
absorbing securities at reasonable
rates which could not nave been
considered few months ago. Maj
! kct quotations Of Liberty bonds
| have steadily advanced until they
are now approaching par. Good
railroad and industrial bonds have
also appreciated and there have
been some noticeable advances in
standard stocks. High commodity
prices and great business activity
usually mean lower prices for
bonds an dother securities yielding
a fixed income, while reduced COM
modify prices and lower money
rates bring higher market prices
for bonds.