Evening star., 1935-03-04
BANKERS DISCUSS
NEW j. S. BONDS
Details of Exchange Offer
Received With Great
Interest Here.
BY EDWARD C. STONE.

low 8 per cent for the first time since
the World War, in exchange for
$3.50, 900 900 of Fourth AZ per cent
Liberty Bonds. Notices and all the
details of the exchange offer were re-
ceived this morning by member banks
in the Federal Reserve Bank of Rich
mond.
The Richmond announcement states
that the issue consists Of 1925 year
27s per cent Treasury bonds of 1885,
1860, offered entirely on an exchange
basis for the Fourth 4As, called for
redemption on April Is. The new
notes are to be designated as Series
A-1940.
The bonds will be the cheapest and
longest dated bonds outstanding as
current obligations Of the Treasury.
Only the 2 per cent consolS, Q per
cent PanamaS and az per cent postal
savings bonds, all callable or redeem
able, bear smaller coupon rates.
It is stated that only the accumu-
lation of excess reserves in the hands
of the Federal Reserve member banks,
now approaching the $2,500,000,000
mark, has enabled the Treasury to fix
a rate of 27s per cent. The CONVEX
sion of Liberties from a 4A rate to
the 27s per cent basis will save the
Government more than S25,000,000 a
year on the $3.50, 100000 obligations
affected
Interest on the called Fourth 4As
rendered in payment for the new
bonds will be paid up to March is,
1885, the Richmond Bank announces.
The opinion Is expressed that the new
issue may bring about further ex-
pansion in commercial loans. The
lower rate, Of course, makes 1t harder
for banks and investors to make salts
factory returns on Government issues.
Whether there will be real swing
toward commercial loans remains to
be seen.
Bank Demands Further Study.
The National City Bank in its
monthly review, out today, demands
that Congress give further study to
Title II of the pending banking act.
Title II is considered the heart Of the
bill, as it contains proposals for
fundamental changes in banking con-
troll and practice. The Importance Of
the whole bill is stressed as follows:
"The proposals affecting the bank
ing system embodied in the new bill
before Congress known as the banking
act of 1885 are of so fundamental a
nature as to make this bill the most
important piece of banking legislation
since the Federal reserve act. The
bill is of importance to every bank
depositor because it concerns the
soundness and liquidity of banking
assets, and it is of importance to every
man, woman and child because it
concerns the value Of money. In q
country like the United States, where
80 per cent of the aggregate value OF
all payments is made by checks drawn
against bank deposits, it is obvious
that the volume of bank credit is a
far greater factor in determining what
the dollar will buy than the amount
Of currency outstanding.
This is the reason why this bill
proposing to remodel the banking Sys-
item is q matter of vital interest, not
only to bankers, but to every indi-
vidual who has savings or other kinds
of property, or who uses money for
any purpose whatever, and this, of
course, means every one.
I'm so far as the vital provisions of
Title II Of this bill are concerned, it
is difficult to see how anything will
be gained by haste. 1t is easy to see
how much might be lost. There can
be no doubt but that the country
would feel far more secure, and the
chances of reaching wise conclusions
far greater, If this section of the bill
were reserved for more extended study
and debate"
Retail Trade Doing Well.
Retail trade in the Fifth Federal
Reserve district, which includes Wash
tngton, was good last week, the Bank
of Richmond announces. Special sales
in the stores in many leading cities
in the district were well supported.
The warmer weather in the southern
part of the territory has proved extra
beneficial. The letting up in trade,
which has been predicted in some Sec
tions of the country, has not devel-
oped here, latest reports show. Whole
sale firms are reported as busy as the
retail concerns.
The current survey of February
sales and collections by the National
Association of Credit Men finds 20
cities reporting good" sales and %
noting good" collections. Among the
cities reporting both are Richmond
and Norfolk, Va. Collections also are
especially good in Parkersburg, w. Va.
In its Spring forecast the United
Business Service of Boston says today
that commodity prices, currently at
the highest level for the recovery
period, are believed to be at their top
limits for some time to come. Neither
consumer nor heavy industry buying
power is sufficiently large to permit
further advances in quotations at this
time.
Woodward Stock at New Peak.