The Washington times., 1933-03-09
BANK CHANGES
PROPOSED To
ROOSEVELT
By TINES FINANCIAL EDITOR


BY TIMES FINANCIAL EDITOR
Before night we all shall know
the terms Of the emergency bank
ing legislation proposed by Pres
ident Roosevelt to Congress, and
by Saturday night we may expect
to know how that body has
translated mis- proposals into law
and see the legislators on the
way to their homes for a Is to
80 day recess.
Permanent Plan to Come
Whatever they shall have done
must be taken as purely 7top-
gap action, and the President and
his advisors will employ this ley
islative vacation in formulating
and preparing submission to Con-
gress, when it reconvenes, the
recommendations and measures
by which it is proposed to put
the country, as rapidly as may
be, on a sound economic basis.
It is permissible, therefore, now
to speculate on what is to oe
soon forthcoming. Because stable
money and elastic credit are
recognized economic essentials,
while safety of savings and
reaSonahI'- safe investment are
ideals for attainment under any
capitalistic social system, and
because banks and bankers
recently have been picked out in
a pitiless spotlight, President
RooSevelt'S recommendations for
the rehabilitation of the country's
banking ,ystem are awaited with
particular interest.
It is this writer's purpose, there
fore, to publish here, as they are
obtainab', specific plans for
banking reconstruction authorita-
lively known to be before Pres
lent T 0osevelt for consideration.
They will be presented without
bias, and with a minimum Of
interpretative comment.
Text of Drastic Proposal
Below is the text Of one plan
brought to the Presidents atten.
ton by one of his most intimate
confidants, representing highly
respectable and influential group.
It is in the form of an amend
ment to the Federal Reserve Act,
and eliminating the enacting
clause, is as follows.
Section 13b. For the dura-
ton of q period Of emergency,
as it may be defined and de-
clared by a proclamation Of
the President, each Federal
Reserve Bank shall have all
the powers, and be under and
perform all the duties neceS-
Sary to conduct a general bank
ing business, including the
power to accept deposits, and
to make loans, subject to such
regulations as the Board shall
prescribe.
"ThereupOn every member
bank of the Federal Reserve
System shall automatically be-
come and be a statutory agent
of the Federal Reserve Bank
of the Reserve District in which
such member bank has its prin-
cipal office, and shall accept
deposits, make loans and other
wise conduct a general banking
business, as such agent, for and
in the name and on account of
such Federal Reserve Bank,
subject to such regulations as
the Board shall prescribe.
MAY EXTEND PRIVILEGES
"Any Federal Reserve Bank
may designate any nOn-member
bank or banks, within its Re
serve District, to be also its
statutory agent or agents, with
like powers and duties as such,
as If such bank or banks were
members of the Federal Re-
serve System. In each Reserve
Bank District there shall be an
officer, to be appointed b. the
governor Of the Reserve Bank,
and to have the title of Federal
Reserve Administrator, with
such salary and duties as the
Board shall prescribe"
Beyond noting that this pro.
posal is, in form, one of the
briefest and in effect one of
the most far-reaching known to
be before President Roosevelt,
this writer presents it without
comment for public considera.
tion and study.