Milford chronicle., 1935-06-14
ECONOMIC HIGHIIGHTS
INDUSTRIAL NEWS
REVIEW

! For all that Is written ana sale
to the contrary, business today IS as
much-and perhaps mOre-afraid 81
imitation than It was two years age
when the clouds OF currency mani.
pulation filed the financial sky. one
indication Of business attitude Is the
fact that the Administration has
twice within a late week attempted
to assure industrialists that imitation
is not anticipated, that sound cur
rency will be maintained.
Secretary Morganthau's recent
speech was designed to quell inter-
nal fears as to the stability OF the
dollar, and to point out that the
Treasury was ready and willing to
cooperate with other nations In
achieving monetary stabilization.
That represents a rather decisive
change from the Administrator
past stand-it will be remembered
that the President wrecked" the
World Economic Conference BY fat
ly refusing to consider stabilization.
Second event was the Presidents
own speech before Congress in veto
ing the bOnus-it represented the
hrst time that a Chief Executive has
appeared before the legislative
branch to explain a veto, ask that il
be upheld. The President covered
much larger issues than the bonus
in his talk-whieh was extremely
well received. was praised BY con- |
serVative newspapers which dislike |
most of his speeches-and pledged /
the Administration to oppose the |
prOmiscuous issuing Of greenbacks.
KEYNOTE of all he said was monetary
Even so, business is not convinced.
and a good many level-headed OBJ
servers can still see the Ominous
spectre of imitation on the horizon.
Vain reason is the so-cailed "Omni-
bus Banking Bill" which has passed
ne House, is now pending in the
Proponents and opponents of the
lill agree on one thing: II it masses
ne banking set-up of the nation will '
le almost entirely revOlutionized.
1t the present time, the power to
control the flow of the countrys t
redit and currency. rests largely in I
he hands Of the governors and di- {
ectors Of the twelve Federal Re- I
erve Banks. The bill provides that I
MS power shall be taken from these n
oVernors, given to a Federal Re- b
erVe Board whose members shall
e appointed by the President The e
isue. then, in the words of News n
Week, is this: Should power over n
lie controlling mechanisms be placed n
18th a Federal Reserve Board sub 81
sct to political domination? Or 81
iould this power 30 to an indepen- n
eht committee Supreme Court of
anking?" cI
That issue is arousing one of the C;
tterest verbal battles of years sc
nong experts. Administration men. &C
lch as Federal Reserve Governor til
ccles, who fathered the bill, feel tn
at the political domination phase c,
the matter is less important than ia
seems, that the creation of a Fed
al Reserve Board is highly desir- ia
ce. Opponents of the bill agree sil
IN winthrop Aldrich, head Of Chase Co
ltlonal Bank, largest commercial tn
slitutlon IN the country, who re- ge
htly said: This is not liberaliz- SCI
: the Federal Reserve. II is max pO
II into an instrument of despotic mi
thority." cor
Vow for the imitation possibilities Wi
the bill. According TO Mr.. Aldrich ind
grants the power to the proposed the
leral Reserve Board to force on I
Federal Reserve System an in the
mite amount OF any kind of gov see
lment securities; to fix rates of "sa
count and interest charge by the hav
serve Banks; to lower the stand trui
s hxed in the law describing the turl
Ility OF paper" the Reserve Banks
Duy or accept as collateral: To 7
lte currency; to force the banks ing
engage in any Open-market Sc its
lty operations it deems advisable rem
Ter the last provision the Board give
Ia force the. banks to purchase of c
obligations in unlimited ersE
UNITS directly from the Treasury the
Is obvious then that passage of ther
act would give an Administra- b
controlled Board unuualifed ton
er to force credit expansion dras
cn Is nothing more or less than coul
ltlon. Under the terms of The real
the Treasury could sell new Sc aste
ties to the banks whenever II trial
me pressed for funds. whether sign
lot income and the state of the natu
ency justified their being mr. ing.
ed' OId-time bankers and finan- temT
commentators literally shudder with
they think Of the possibilities will
rent in that.
Is difficult to forecast whether CT
OF the Act will pass with the OSA
res conservatives think are oh
'naDle still in it, II seems Ger
howeyer, that the bill will he
hed to some degree in the Sen Prov
iue principally to Senator Glass OF
is hard-money man from 'wav
hstes and fears any and All Ma
OF imitation. distrusts Mr. Ec- tiona
economic views. 0Tnb
has
MAJORS OUGHT TO HAVE EXPIRE
SENSE thank