Evening star., 1942-09-15
Earnings and Savings
Show Big Increase
With War Costs
Treasury Borrowings =
Expected to Average
4 Billion q Month

Although no hope was held for
any immediate lessening of the war
cost, which nicked Uncle Sam for
nearly ga bristling billions during
July and August alone, John @.
Taxpayer still found some cause for
cheer in the Federal Reserve
Boards monthly financial bulletin
issued today.
In the first place, John is making
about $17,0O0,0O0 1000 more than he
earned last year and. secondly, he
is saving nearly twice as much as
he was year ago.
Reviewing the Nations financial
status, the board predicted that the
Treasury would need to borrow an
average of at least $4000,000 900
month during the rest of the fiscal
year if it continued to operate on
the present wartime schedule of ex-
penditures and receipts.
Public Debt Boosted.
That schedule increased the public
debt by $4,7o0 100000 in July and
by only slightly smaller amount
in August.
At the same time tax receipts
which are seasonally low in those
two months, more than kept pace
with non-War expenditures. This
meant that the balance of the cur
rent national income could be
turned toward defraying the costs of
war, thus decreasing by at least a
small amount the potential postwar
public debt.
Figuring on the basis of earnings
during the second quarter of this
year, the board estimated that the
national income for 1912 would total
$l12 900 900 ,000-an increase of ST.
600, 900 900 over 1941.
Shooting even more sharply up
ward, net savings of individuals
will be nearly doubled during the
year-jumping from s12, 700, 900 900
in 1941 to an estimated total of
24,200 100000 for 1912.
Circulation Expands.
An increase in the amount of
money in circulation and a growth
in bank deposits were listed as
causes of a decline of nearly IS, ,OO0,-
1000 in the excess reserves in
member banks of the Federal Re-
serve System during the last year
and a half.
The board said that excess re-
serve of member banks amounted to
approximately $2,100,O0O, 900 at the
END OF August as compared to
nearly $1,000, 100000 at the begin
ming of 1941.
The increased money in circula-
ton has been provided by banks
drawing upon their reserve bal
ances, and the deposit increase has
added to the amount of required
reserves and thus reduced excess
reserves, the board pointed out.
U. S. Funds Withdrawn.
The United States Treasury yes
terday announced the withdrawal
OF S458 100000 from the depositors
OF Federal Reserve banks through
out the Nation on September II and
18, in one of the largest single
calls on record.
AAN ASSoSlFC OdllhS WtTG ll-
structed that the amounts were to
be deposited to the Treasury's credit
on the two days, one half the total
on each day.
The amounts called by Federal
Reserve districts were as follows:
Boston, s10,600,0Oo: New York
$276, 400, 900; Philadelphia, $1O,90O,-
600; Cleveland, $10000,0O0; Rich
mond, $8,10O,O0O; Atlanta, $15.10o,-
000 Chicago. s6S,500,00O; st. Louis
$40, 400, 900; Minneapolis, s4,400, 900;
Kansas City, $1,000 900; Dallas, s13.-
100000, and San Francisco, $21,-
100000.
| Bank Loans Decline,
Commercial, industrial and agri-
cultural loans declined 5000. 900 in
banks in 101 leading cities during
the week ending September 9, the
Federal Reserve Board reported yes
trday. OF the total, $4,000, 900 was
in New York City.