Federal Reserve Bulletin January 1923 - Fraser

FEDERAL RESERVEBULLETIN

(FINAL EDITION)

ISSUED BY THE

FEDERAL RESERVE BOARDAT WASHINGTON

JANUARY, 1923

WASHINGTON

GOVEEKMENT PRINTING OFFICE

1923

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BOARD.

Ex officio members:A. W. MELLON,

Secretary of the Treasury, Chairman.

D. R. CRISSINGBE,

Comptroller of the Currency.

, Governor.EDMUND PLATT, Vice Governor.

ADOLPH C. MILLER.

CHARLES S. HAMLIN.

JOHN R. MITCHELL.

W. W. HOXTON, Secretary.

W. L. EDDY, Assistant Secretary.

W. M. IMLAY, Fiscal Agent.

J. F. HERSON,

Chief, Division of Examination and Chief FederalReserve Examiner.

WALTER WYATT, General Counsel.

WALTER W. STEWART,

Director, Division"j)f Analysis and Research.M. JACOBSON, Statistician.

E. A. GOLDENWEISER, Associate Statistician.

E. L. SMEAD,

Chief, Division of Bank Operations.

FEDERAL ADVISORY COUNCIL.

(For the year 1922.)

DISTRICT NO. 1 (BOSTON) PHILIP STOCKTON.

DISTRICT NO. 2 (NEW YORK) PAUL M. WARBURG, Vice President.

DISTRICT NO. 3 (PHILADELPHIA) 4 L. L. RUE, President.

DISTRICT No. 4 (CLEVELAND) C. E. SULLIVAN.

DISTRICT NO. 5 (RICHMOND) J. G. BROWN.

DISTRICT NO. 6 (ATLANTA) EDWARD W. LANE.

DISTRICT NO. 7 (CHICAGO) JOHN J. MITCHELL.

DISTRICT NO. 8 (ST. LOUIS) FESTUS J. WADE.

DISTRICT NO. 9 (MINNEAPOLIS) G. H. PRINCE.

DISTRICT NO. 10 (KANSAS CITY) E. F. SWINNEY.

DISTRICT No. 11 (DALLAS) R. L. BALL.

DISTRICT No. 12 (SAN FRANCISCO) D. W. TWOHY.

n


OFFICERS OF FEDERAL RESERVE BANKS.

Federal Reserve Bank of—

Boston

New York.,

Philadelphia.Cleveland

Richmond.

Atlanta..

Chicago..

Chairman.

Frederic H. Curtiss.

Pierre Jay

E. L. AustinD. C. WillsCaldwell Hardy

St. LouisMinneapolis..

Kansas City..DallasSan Francisco

Joseph A. McCord.

Wm. A. Heath....

Governor.

Chas. A. Morss.

Ben]. Strong...

George W. Norris.E. R. Faneher

George J. Seay

M. B. Wellborn.

J. B. MeDougal.

Wm. McC. Martin B.C.] . „John H. Rich I R. A. Young

Asa E. RamsayW. B. NewsomeJohn Perrin

W. J.BaileyB. A.McKinney.J. U. Calkins

Deputy governor.

C. C. BullenW. W. Paddock...J. H.CaseL. F. SailerG. L. HarrisonE. R. Kenzel

Wm. H. Hutt, jr...M. J. FlemingFrank J. Zurlinden.C. A. PepleR. H. Broaddus....A. S. Johnstone2...John S. Walden *...L. C. AdelsonJ. L.CampbellC. R. McKayS.B.CramerJohn H.Blair

O. M. AtteberyW. B. GeeryS. S. CookFrank C. Dunlop*.C. A. Worthington.R. G. EmersonWm. A. DayIra Clerk.*L. C. Pontious8

Cashier.

W. Willett.

L. H. Hendricks.1J. D. Higgins.»A. W. Gifcart.1Leslie R. Rounds.'J. W. Jones, iRayM. Gidney.'G. E.Chapin.fW. A. Dyer.H. G. Davis.

Geo. H. Keesee.

M. W. Bell.

W. C. Bachman. >K.C.Childs.1J. H. Dillard. 1D. A. Jones.1O. J. Netterstrom. 1A. H.Vogt.iClark Washburne.1J. W. White.B. V. Moore.

J. W. Helm.R. R. Gilbert.W. N. Ambrose.

i Controller. 2 Assistant to governor. ' Assistant deputy governor.

MANAGERS OF BRANCHES OF FEDERAL RESERVE BANKS.


New York:Buffalo branch

Cleveland:Cincinnati branch..Pittsburgh branch...

Richmond:Baltimore branch...

Atlanta:New Orleans branchJacksonville branch.Birmingham branch.Nashville branch

Chicago:Detroit branch

St. Louis:Louisville branchMemphis branchLittle Bock branch..

Manager.

W. W. Sehneckenburger.L. W. Manning.Geo. DeCamp.

A. H. Dudley.

Marcus Walker.Geo. R. De Saussure.A. E. Walker.J. B. McNamara.

R. B. Locke.

W. P. Kineheloe.J. J. Henin.A. F. Bailey.


Minneapolis:Helena branch

Kansas City:Omaha branchDenver branchOklahoma City branch

Dallas:El Paso branchHouston branch

San Francisco:Los Angeles branchPortland branchSalt Lake City branchSeattle branchSpokane branch

Manager.

R. E. Towle.L. H. Earhart.C. A. Burkhardt.C. E. Daniel.

W. C. Weiss.Floyd Ikard.

C. J. Shepherd.Frederick Greenwood.R. B. Motherwell.C. R. Shaw.W. L. Partner.

SUBSCRIPTION PRICE OF BULLETIN.

The FEDERAL RESERVE BULLETIN is the Board's medium of communication withmember banks of the Federal Reserve System and is the only official organ or periodicalpublication of the Board. It is printed in two editions, of which the first contains theregular official announcements, the national review of business conditions, and othergeneral matter, and is distributed without charge to the member banks of the FederalReserve System. Additional copies may be had at a subscription price of $1.50 perannum.

The second edition contains detailed analyses of business conditions, special articles,review of foreign banking, and complete statistics showing the condition of FederalReserve Banks. For this second edition the Board has fixed a subscription price of$4 per annum to cover the cost of paper and printing. Single copies will be sold at40 cents. Foreign postage should be added when it will be required. Remittancesshould be made to the Federal Reserve Board.

No complete sets of the BULLETIN for 1915,1916,1917, or 1918 are available.


TABLE OF CONTENTS.

General summary: Page.Review of the month 1Business, industry, and finance, December, 1922 7

Interbank deposits 25The first three years of German reparation: Part III—Modifications of the treaty 29Finance companies 37Report on stabilization of the mark 45Official:

Rulings of the Federal Reserve Board—Amendment to Regulation B 19

Law department—Petition for rehearing denied in Richmond par clearance case 20Exercise of fiduciary powers by national banks located in Pennsylvania 20Right of Federal reserve bank to charge back forged Government check 22

State banks admitted to system 24Fiduciary powers granted to national banks 24Charters issued to national banks 24Election of directors of Federal reserve banks 24Appointment of Federal reserve agents 25

Business and financial conditions abroad:United Kingdom—The course of prices 50France—The internal floating debt—Prices 53Germany—Currency stabilization—Prices—Foreign trade 61Argentina and Brazil 69,72Mexico—Recent banking developments 73

Price movement and volume of trade:International wholesale price index—United States, England, France, Canada, and Japan 78Wholesale prices of individual commodities in the United States 80Comparative wholesale prices in principal countries 82Comparative retail prices and cost of living in principal countries 86Indexes of industrial activity—United Kingdom, France, Germany, Sweden, and Japan 87Foreign trade of principal countries 89Foreign trade index 92Ocean freight rates 93Report of associated knit underwear manufacturers of America 93Production and shipments of finished cotton fabrics 94Physical volume of trade 95Building statistics 100Retail trade 101Wholesale trade 105Commercial failures 93

Banking and financial statistics:Domestic—

Discount and open-market operations of Federal reserve banks 106Condition of Federal reserve banks 112Federal reserve note account 116Condition of member banks in leading cities 117Savings deposits '. 92Bank debits 121Operations of the Federal reserve clearing system 125Gold settlement fund 127Gold and silver imports and exports 126Money in circulation 127Discount rates approved by the Federal Reserve Board 126Discount and interest rates in various centers 128Foreign exchange rates 129

Foreign—England, France, Italy, Germany, Norway, Sweden, Japan, and Argentina 132Charts:

Index of production in basic industries 7Index numbers of wholesale prices 7Volume of payments by check 8Bank credit 8International wholesale price index—Federal Reserve Board 77Index numbers of domestic business 95Monthly sales of department stores and mail-order houses * 101German mark rate 129Foreign exchange index 130

IV


FEDERAL RESERVE BULLETINVOL. 9 JANUARY, 1923. No. 1

REVIEW OF THE MONTH.

The year 1922 is significant in the bankingand financial history of the country as marking

the close of a protracted periodBanking and of liquidation. Shortly after

credit during 1922. the middle of the year arenewed demand for credit for

commercial purposes resulted in increasedborrowings both at member banks and Federalreserve banks and in an advance of moneyrates. This turn in the course of creditdemand occurring after a year and a half ofloan liquidation reflects a change in underlyingbusiness conditions. In view of the fact thatthe volume of business has been expandingcontinuously for about a year, there is lessoccasion for surprise in the recent increase inthe credit requirements than in the fact thatthe demand for additional funds was notfelt sooner and on a larger scale. Loanliquidation indeed continued for almost ayear after industrial operations increased involume, and the increase in bank loans hasnot up to the present been in proportion tothe increased volume of current businesstransactions. Few questions are of greaterpractical importance in their bearing uponbanking policies during the coming year thanthe question whether or not this turn fromliquidation to loan expansion represents thebeginning of a definite and continuous upwardtrend in the demand for credit.

An advance of money rates during the lastquarter of the year, when seasonal requirementsfor funds are large, is not in itself significantunless accompanied by other changes in thebanking and business situation. The partic-ular importance, therefore, of these changesin credit demands arises from the characterof coincident changes in other economicconditions. I t was not until the end of July

that the upward turn in the demand for creditbecame manifest through a change in thevolume and character of banking operations.At that time the commercial loans of memberbanks in industrial and financial centers beganto increase after declining for more than 18months, while purchases of securities andloans on stocks and bonds, which had beenincreasing for a similar period, ceased toadvance. Borrowings by member banks atFederal reserve banks turned sharply upwardand the volume of Federal reserve notes incirculation responded to an increased demand.Early in August interest rates on practicallyall classes of loans in the New York marketadvanced and the market prices of bondsdeclined slightly; in September rates onbankers' acceptances rose; and throughout theremainder of the year money rates weremaintained at a somewhat higher level.

Events during recent years throw lightupon the relation between the demand for

bank credit and the generalBank credit, pro- trend of business. While not

duction and prices, all the factors determiningcredit requirements can be ac-

curately measured, yet a definite sequence ofchange in the relationship among certain ofthose factors and the general course of bus-iness can be observed. In the autumn of 1920the volume of loans of member banks and ofFederal reserve banks reached its peak fivemonths after prices had begun to decline, andnearly a year after industrial activity hadslackened. Similarly, in 1921 the increase inthe production of basic commodities precededthe rise in prices by six months and antedatedthe expansion of commercial loans by a fullyear.

The reasons for the lag in the changes in thedemand for bank credit behind the changes in

1


FEDERAL BESBRVE BULLETIN. JANCABY, 1923.

production and prices may be found in thecharacter of the business situation prevailingat the time. In 1920, when prices began theirabrupt decline, loans continued to increase,chiefly because business concerns were unableto meet their obligations to the banks and in factwere applicants for additional credit. Thebanks in turn, finding their own resources in-adequate to meet these demands, borrowedheavily from Federal reserve banks. Further-more, since the early stages of the businessreaction came at crop-moving time, the seasonalrequirements for currency added to the creditstrain, as the additional notes had to be obtainedby member banks through borrowing from theFederal reserve banks. When the course ofbusiness turned upward in the latter part of1921, the revival of industrial activity enabledmany borrowers to repay their "frozen" loans,the liquidation being facilitated by the in-crease in trade. Member bank funds thusreleased were used to reduce their indebted-ness with Federal reserve banks. This resultedin a continuous reduction of member bankborrowings from the Federal reserve banksuntil the end of July, 1922. The continueddecline in the volume of borrowing for commer-cial purposes, in spite of a revival in many linesof industry which had been under way fornearly a year, is accounted for partly by the factthat many corporations issued bonds and usedthe funds secured through their sale to pay offtheir bank loans. Another effect of theseflotations was seen in the increase of loanssecured by stocks and bonds made largely bybanks in financial centers. The increase inthese loans preceded the increase in commercialborrowings, partly because of advances madeto investors in the new securities, but also be-cause of the increased activity of the stockand bond markets. The fact that during theliquidation business concerns reduced theirinventories and accumulated bank balanceswas a further cause leading to postponement ofborrowing. Both on the upward and the down-ward trend of business, therefore, the tendencyhas been for the changes in bank credit to lagbehind the changes in prices and production.

Changes in the volume of bank credit as re-lated to the volume of production and the levelof prices for the years 1919 to 1922 are showngraphically in the following chart. The fluctu-ations in production are measured by an indexrecently constructed by the Federal EeserveBoard for the purpose of furnishing a promptindication of change in the physical volume oftrade. A description of the method of con-struction and a list of the commodities includedwere presented in an article published in theDecember, 1922, issue of the FEDERAL R E -

SERVE BULLETIN. The index of bank credit isbased on the total loans (including rediscounts)and investments of all member banks. Thisinformation is available only four times a year,but the figures are more representative thanany other figures available of the total volumeof credit extended by member banks. Theprice index is that of the Bureau of LaborStatistics, the prices of 1919, for the sake ofcomparability, taken as 100.

PERCENT

120

100

60

60

20

0

—

\

imtmBAMK CfttD'T

*—v PRODUCTION +*-•+

" " • • • • • " ! ' » :^ . . . • - -

1919 19221920 1921

(1919 average-100).

Prices.—U. S. Bureau of Labor Statistics index number of wholesaleprices.

Production.—Index of production in basic industries; combination of22 individual series corrected for seasonal variation.

Bank credit—Total loans and investments of all member banks on calldates.

The chart indicates that the production ofbasic commodities began to decline in January,1920, and prices turned downward in the fol-lowing May, while total loans and investmentsof member banks continued to advance untilNovember. On the upward turn productionbegan increasing in July, 1921, six months be-


JANUARY, 1923. FEDERAL EESERVE BULLETIN.

fore prices reached their low point, while thevolume of member bank credit continued todecline until March, 1922.

The curves differ from each other both withrespect to the dates of their turning points andto the relative extent of their declines and sub-sequent advances. Prices declined 44.2 percent between May, 1920, and January, 1922;production fell off 35.1 per cent between Janu-ary, 1920, and July, 1921; while the reductionin loans and investments at member banks be-tween November 15, 1920, and March 10, 1922,was only 9.6 per cent. Since the low pointsproduction has shown the most rapid rate ofadvance, the figures for November, 1922, show-ing a 55 per cent increase over July, 1921.Prices rose 13 per cent between January, 1922,and November, 1922. Ou June iO, 1922, thelatest reporting date for all member banks, thetotal of their loans and investments was 4 percent greater than at the low point on March 10,1922.

One reason for the relatively slight extent ofthe increase in the total volume of memberbank credit in 1922 is that it suffered only aslight reduction in 1921 when compared withthe decline in prices and production. Also therelatively lower level of prices has made itpossible to finance the steadily expandingvolume of production and trade with a smalleramount of bank credit in 19-12 than in 1920.On June 30, 1922, the latest date for whichinformation is available for all member banks,loans and investments were only 6 per centbelow the 1920 peak, while prices were 37 percent lower than their high point in 1920.Loans and investments for national banks atthe September 15 call show a reduction sinceJune 30 in central reserve cities and furtherincreases for banks outside those cities.

'He financing of the larger volume of busi-ness during 1922 without a correspondingincrease in bank loans was also facilitated bythe fact that liquidation continued in somelines of business and released funds for expan-sion in others Also the purchase of securitiesby the banks from their customers had the

effect of adding to the volume of liquid fundsavailable for current operations.

Credit extended by banks to the public ismeasured by their total loans and invest-

ments. Between November ,Member bank 1 Q 2 0 ftnd M a r c h 1 9 2 2 , this

a n d r e s e r v e b a n k , , , , , . , . i , ,

credi t total declined as a net result ofloan liquidation accompanied

but not entirely offset by increasing purchasesof investment securities. Except for the highpoint reached in March, 1919, when the bankstemporarily held unusually large amounts ofUnited States securities, the total of securitiesowned by member banks on June 30, 1922, wasthe largest ever recorded. The extent to whichthe purchases of Government and corporatesecurities by all member banks offset the reduc-tion in their loans is shown in the followingtable:

[In millions.of dollars.)

Nov. 15,1920Mar. 10,1922.June 30,1922

Totalloansand

invest-ments.

25,89523,40424,344

Investments.

Loans.

19,94117,17617,282

Total.

5,9546,2587,062

UnitedStatessecuri-ties.

2,7862,7553,247

Otherbondsand

securi-ties.

3,1683,5033,815

Differences in the extent of loan liquidationand of increase in security holdings are seenbetween the various classes of banks. Loanreduction and the increase in security holdingswere least at country banks and greatest atbanks in central reserve cities, but there werealso differences between the banks in invest-ment policies pursued in the selection of securi-ties purchased; country banks increased theirtotal holdings of securities and reduced theirholdings of United States securities, whilebanks in central reserve cities purchased largeamounts of United States obligations andsmaller quantities of other securities. Thefollowing comparison shows the extent of loanreduction from the peak to the low point foreach class of banks and the change in the char-acter of their investment holdings.


FEDERAL RESERVE BULLETIN. JANUARY, 1923.

[In millions of dollars.]

Total, all member banks:Nov.15,1920Mar. 10,1922

Central reserve cities:Nov.15,1920Mar.10,1922

Reserve cities:Nov.15,1920Mar.10,1922

Country banks:Nov.15,1920Mar. 10,1922

Totalloansand

invest-ments.

25,89523,404

7,3296,219

8,1707,347

10,3969,838

Loans.

19,94117,146

6,0944,817

6,4345,558

7,4136,771

Investments.

Total.

5,9546,258

1,2351,402

1,7361,789

2,9833,067

UnitedStatessecuri-

ties.

2,7862,755

568691

777758

1,4411,306

Otherbondsand

invest-ments.

3,1683,503

667711

9591,031

1,5421,761

All member banks combined, seeking em-ployment for their excess funds and followingtheir own investment policies, increased theirholdings of United States securities by over ahalf billion dollars during the year endedJune 30, 1922. Even with this increase, how-ever, their total holdings were approximately$800,000,000 less than on the correspondingdate three years earlier, and even with thereduction that has taken place in the total ofUnited States indebtedness the percentage ofthe total outstanding debt owned by memberbanks was less on that date than on June 30,1919. A comparison of these figures is pre-sented in the following table:

[In millions of dollars]

June 30,1919.June 30,1920June 30,1921June 30,1922.

UnitedStates

securitiesownedby all

memberbanks.

4,0372,9422,6613,247

TotalUnitedStates

interest-bearing

debt out-standing.

25,23424,06123,73722,711

Percent-age of

total debtowned bymemberbanks.

16.012.211.214.3

The funds used by member banks during1922 in the purchase of securities arose partlyfrom loan liquidation and partly from anincrease in deposits. Early in the liquidationperiod the decline in loans was accompaniedby a decrease in deposits, but later depositsincreased and excess funds accumulated.While the loans of member banks in leading

cities declined until the end of July, 1922,deposits began to increase as early as Septem-ber, 1921. In the financial centers the increaseof deposits represented to some extent thegrowth of balances due interior banks, andthe use of these balances in the money marketwas partly responsible for the decline of in-terest rates. During the nine months endingon June 21, 1922, deposits of member banksin leading cities increased by $1,359,000,000,or about 14 per cent, while loans declined$659,000,000, or about 6 per cent. The risein the ratio of deposits to loans from 84 percent on January 7, 1921, to 102.8 per cent onJune 21, 1921, was indicative of the easiercredit conditions. This growth of depositsduring the period of loan liquidation providedfunds with which member banks paid off theirobligations with the reserve banks and whichthey invested in Government and othersecurities.

Member banks continued to reduce theirborrowings at Federal reserve banks until theend of July, 1922, when total discounts reachedthe low point of $380,000,000, a decreaseduring the first seven months of the year of$700,000,000. This decline in discounts, how-ever, did not result in a corresponding reduc-tion in total earning assets, since during thesame period the reserve banks increased theirholdings of United States securities and ac-ceptances by $339,000,000. Throughout theyear a relative stability of the reserve banks'earning assets resulted from the purchase ofGovernment securities and acceptances withfunds released through the reduction of dis-counts. At the opening of the year total dis-counts constituted 77 per cent of earning assetsand United States securities and acceptancescombined, 23 per cent; at the end of July dis-counts had declined to 35 per cent of the earn-ing assets and United States securities andacceptances increased to 65 per cent; but at theend of the year, as a result of increased borrow-ing by member banks, discounts increasedagain to 47 per cent and other classes of assetsdecreased to 52 per cent. It is doubtless truethat the purchases of Government securities


.7ANUABX, 1923. FEDERAL RESERVE BULLETIix.

and acceptances by the reserve banks by in-creasing available funds in the market were anindirect influence in making it possible formember banks to reduce their borrowings.

An important influence on the domesticcredit situation during the past two years has

been exerted by the importa-G.°Vd. i m p o r^ tion of large amounts of gold.

and the credit , , , , . , „situation. N e t g° l d imports m 1922

amounted to about $225,000,-000, compared with about $667,000,000 in1921. The difference is due chiefly to thefact that nearly all the gold outside of care-fully guarded central reserves and tenaciouslyheld private hoards had found its way to theUnited States prior to 1922. Only newlymined gold was available for export duringthe past year, and its supply was reduced bythe strike in the Rand. Also the revival oftrade in India caused a substantial movementof gold to that country. Toward the end ofthe year, moreover, gold was exported toCanada as the result of the temporary rise ofthe Canadian dollar above parity. But thefurther addition to our gold stock, even thoughsmaller than the year before, neverthelessexercised a decided effect on domestic credit.In normal times, with the world on a goldbasis, a movement of gold into a country im-mediately starts a set of forces in operationwhich soon arrests the current. Interest ratesin the importing country decline, exchangerates become unfavorable, and gold begins tomove in the opposite direction. But with a freegold market in this country practically aloneand with most of the world's currencies far belowtheir par values, gold has continued to come tothe United States in large amounts, while theoperation of the normal correctives has beenslow and uncertain. Still, our price level hasadvanced and that in England has declined;the rate of sterling exchange has gone upfrom $4.30 in September, 1921, to $4.61 inDecember, 1922, and the average value of thedollar in the international market has recededfrom 167 per cent of par in September, 1921, onthe basis of 17 leading currencies, not includingGermany, to 144 per cent in December, 1922.

In spite of this evidence of the operation ofeconomic correctives, the steady, though dimin-ishing, stream of gold to our shores continuesto add funds to our domestic supply. In 1921the imported gold was entirely absorbed bythe reserve banks, whose earning assets declinedby nearly $1,000,000,000 more than the stockof gold increased, indicating that the reductionof borrowings from the reserve banks had morethan offset the influence of the gold importson the total volume of credit. In 1922 thesituation was different. While the net impor-tation of gold totaled $225,000,000, the declinein earning assets of the reserve banks, measuringthe total of reserve bank credit in the market,was nearly $100,000,000 less. Available creditat the disposal of American banks has thus beenaugmented during the past year by the impor-tation of gold. The persistent import of goldfrom abroad, in the absence of normal cor-rectives, and in conjunction with influencesat work in the domestic credit situation,makes the problem of credit control in thiscountry more than usually difficult.

TREASURY FINANCE.

Finance operations of the Treasury duringDecember were centered around the 15thof the month, when the fourth installmentof income and excess-profits taxes fell due.The Treasury had called for redemption onthat date about $700,000,000 of 4f per centVictory notes. There also fell due on thesame date about $200,000,000 of Treasurycertificates, the outstanding balance of atotal of $443,500,000 of tax certificatesissued 12 months and 6J months before.Other obligations falling on that date includedabout $100,000,000 for interest on the publicdebt.

In order to provide for the immediate cashrequirements and to cover war-savings cer-tificates to be redeemed in cash at the beginningof 1923, the Treasury issued two series of Treas-ury certificates, one bearing 3£ per cent interestand maturing in 3 months and the other bearing4 per cent interest and maturing in 1 year, and


6 FEDERAL RESERVE BULLETIN. JANUARY, 1923.

a series of Treasuiy notes bearing 4£ per centinterest and maturing in 2\ years. The com-bined offerings of notes and certificates werefor $700,000,000, or thereabouts, with the rightreserved to the Treasury to allot additionalnotes in exchange for 4f per cent Victorynotes. Under date of December 19 the Treas-ury announced that all subscriptions for Treas-ury certificates of both series and for Treasurynotes for which 4^ per cent Victory notes orTreasury certificates had been tendered inpayment had been allotted in full, but thatsubscriptions for the Treasury notes had beenallotted in full only up to amounts notexceeding $500,000 for any one subscriber.Allotments on subscriptions in larger amountswere made upon a graduated scale. Aggregateallotments under the several offerings were$780,164,100, distributed as follows: Z\ per centcertificates, $113,743,000; 4 per cent certificates,$197,233,000, and 4£ per cent notes $469,188,-100, as against a total subscription of $848,-387,700, as may be seen from the following tableshowing the distribution of both subscriptionsand allotments of the three issues, by Federalreserve districts:

Treasury and Federalreserve districts.

TreasuryBostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallas...San Francisco

Total

Subscrip-tions re-ceived.

$163,50049,584.700

374,993,70059,230,40072,622,00021,439,60020,635,400

103,877.50030,562,10013,971,00025,256,90021,682,30054,368,600

848,387,700

Subscriptions allotted.

Treasurynotes, series

C-1925.

$163,50029,826,800

147,021,70047,063,40043,673,70015,781,60016,319,90071,436,10024,203,20011,852,00017,961,00013,790,80030,094,400

469,188,100

Treasurycertificates,

seriesTM2-1923.

$13,266,00069,682,5001,644,0006,313,0001,833,000

888,5003,521,000

945,500497,500

2,189,5004,889,5008,073,000

Treasurycertificates,

seriesTD-1923.

$6,248,000132,289,500

4,641,50010,559,0002,275,0003,177,000

20,768,0004,846,5001,621,5003,216,5003,002,0004,588,500

113,743,000 | 197,233,000

In a letter addressed to the banks of thecountry on December 7, Secretary Mellon out-

lined the purpose of these operations anddescribed the Government's plan of financingas follows:

With the completion of the December financing, theTreasury will thus have provided for most of the short-dated debt maturing this fiscal year. Aside from thebalance of war-sayings certificates that may remain to berefunded there will only be the issues of Treasury certifi-cates maturing March 15 and June 15, 1923, both coveredby the estimated tax payments to be received in thosemonths, and the remaining uncalled Victory notes,amounting to about $894,000,000 on November 30, 1922.Exchanges of these notes for the new Treasury notes nowoffered, and advance redemptions and retirements for thesinking fund and on other accounts, may be expected toreduce the outstanding amount of uncalled Victory notesstill further before their maturity.

I think you will find it interesting in this connection toknow about the improved prospects of the Treasury forthis fiscal year and the next fiscal year. The budgetwhich was presented to Congress on Monday shows thataccording to the latest revised estimates of receipts andexpenditures the deficit for the current fiscal year hasalready been reduced to about $274,000,000 as comparedwith an indicated deficit of about $697,000,000 at thebeginning of the fiscal year, and at the same time holdsout a real hope that by the end of the year the deficit canbe entirely overcome by still further reductions in ex-penditure and increases of receipts, arising partly fromfurther realization on Government-owned securities andproperty and partly from increased collections of customsand internal taxes. The actual receipts and expendituresof the Government for the first five months of the currentfiscal year, through November 30, 1922, support theseestimates. Total ordinary receipts to that date, on thebasis of daily Treasury statements, amounted to $1,404,-776,456.64, as compared with total expenditures chargeableagainst ordinary receipts amounting to $1,514,314,770.80,leaving a deficit for the first five months of only $109,538,-314.16. By the end of December this deficit should beovercome by the quarterly payment of income and profitstaxes which falls due in that month, thus leaving a bal-anced budget, or perhaps even a small surplus, for thefirst six months of the fiscal year 1923. The prospects forthe second half of the year are likewise favorable. Thebudget estimates for the next fiscal year, 1924, indicatea surplus of about $180,000,000, and though it is still tooearly to forecast the actual results, this indicated surplusgives some margin to take care of any deficit that maypossibly remain at the close of the present year, or, if thisyear closes with a balanced budget or a small surplus, canbe applied to the retirement of debt maturing within thefiscal year 1924. For both years 1923 and 1924 the budgetprovides for the regular sinking fund requirements andother public debt expenditures chargeable against ordi-nary receipts, so that any surplus that can be realized ineither year will mean additional retirements of debt.

The Treasury is accordingly financing its Decembermaturities on a short-term basis, believing that the pros-pects for the next year or two indicate the probability ofsubstantial retirements of early maturing debt out of cur-rent receipts.


JANUAKT, 1923. FEDERAL RESERVE BULLETIN.

BUSINESS, INDUSTRY, AND FINANCE, DECEMBER, 1922.The volume of production and employment continued upward in November, and prices

registered a further advance.Production.—Contrary to the usual trend at this season of the year, productio-n in basic

industries in November continued to increase. Since July, 1921, when production was lowerthan at any time in recent years, there has been an almost uninterrupted rise month by month.The index, illustrated in the chart, in which allowance has been made for seasonal changes,shows that production in basic industries during November was 55 per cent higher than inJuly, 1921, and 8 per cent higher than in October, 1922. The chief advances from Octoberto November were in mill consumption of cotton, which reached a monthly total exceededonly once since 1917, and in the production of pig iron, which was larger than at any time inthe past two years. Building operations were maintained on a large scale, despite the ap-proach of winter.

Final estimates for the year placed the yield of all principal crops ahead of 1921, exceptthat of corn, which was unusually, large in 1921. As a result of these larger yields and thehigher prices as well, the total farm value of crops grown in 1922, based on prices received atthe farm, as of December 1, is estimated to be 25 per cent larger than in 1921, but 17 per centless than in 1920.

Increased production was accompanied by continued heavy freight movement. Thetotal number of railroad cars loaded during November was substantially larger than in thecorresponding month of previous years, although 5 per cent less than in October. The de-cline in the demand for cars and a further decrease in the proportion of cars out of repair haveresulted in a considerable reduction in the freight-car shortage.

INDEX OF PRODUCTION IN BASIC INDUSTRIES

PER CENT160r

60

60

20

COMBINATION OF 2 2 INDIVIDUAL SERIESCORRECTED FOR SEASONAL VARIATION

( rSIS-IOQ)

1919 1920 1921

LATEST FIGURENOVEMBER

1922

PERCENT1160

100

60

1923

PER CENT300

2 5 0

ZOO

100

50

PRICESINDEX NUMBERS OF WHOLESALE PRICES

U. S. BUREAU OF LABOR STATISTICS( l$!3'/0O BASE ADOPTED BY BUREAU)

\

1919 1920 1921


1922

PIRCEMT1300

250

200

150

100

50

1923


FEDERAL RESERVE BULLETIN. JANUARY, 1923.

VOLUME OF PAYMENTS BY CHECKCHECKS DRAWN ON BANKS IN 140 CENTERS,

NEW YORK NOT INCLUDEDBILLIONS OF DOLLARS BILLIONS OF DOLLARS32 I 1 1 1 I I 32

28

2 4

20

16

/JV irVYy 1. .,T


*

28

1919 1920 19Z1 1922 1923

BANK CREDIT800 MEMBER BANKS IN LEADING CITIES

BIL16

14

12

10

8

e

4

2

0

LIONS OF DOLLARS

DEMAND

T1MCDEPOSITS^ ,

*% LOANS Ati\DISCOUI

mvESn

" • ' - •

BILLIONS OF DOLLARS

DVTS

£/'

ENTS,''"'"

LATEST FIGUREDEC. 13

14

12

10

8

6

4

2

01919 1920 1921 1922 1923

Demand for labor continued to increase, as shown by the volume of employment at in-dustrial establishments. Local shortages of labor were reported by steel mills, textile mills,and building contractors in eastern districts, but some surplus of common labor was reportedfrom agricultural districts.

Wholesale prices.—Wholesale prices advanced during November and reached the highestlevel since March, 1921. The rise of t\*7o points in the Bureau of Labor Statistics index to 156was due chiefly to advances in the prices of farm products, foods, and clothing, which rose tothe highest point of the year. These advances more than offset the decline in the prices offuels and metals.

Volume of trade.—Wholesale trade in lines reporting to Federal reserve banks was sub-stantially larger during November than in the corresponding month last year. Sales of de-partment stores and mail-order houses during November were also larger than a year ago, andreports of Christmas trade thus far received indicate sales larger than in either 1920 or 1921.The volume of payments by check was 7 per cent smaller in November than in October, duepartly to the smaller number of business days, but was 10 per cent larger than in November,1921.

Bank credit.—During the period between November 22 and December 20, Federal reservebanks have been called upon to supply the extra currency needs of holiday trade, and thisdemand is reflected in an increase of $157,000,000 in Federal reserve note circulation, bringingthe total to the highest point for the year. A decline of $43,000,000 in gold reserves is largelydue to increased use of gold for currency purposes. The total earning assets of the Federalreserve banks rose during the period $145,000,000, partly in response to the demand for cur-rency and partly in consequence of heavy Government debt operations on December 15.

In the four weeks prior to December 13 the loans and investments of member banks inleading cities were little changed, though in the latter part of the period a renewed demandwas manifested for commercial loans, offset to some extent by a decline in investments.


JANUABX, 1923. FEDERAL RESERVE BULLETIN.

AGRICULTURE.

The final estimates of the Department ofAgriculture place the crops of wheat, oats, rye,and barley above those of last year, with sub-stantially increased farm values. Corn, thoughit amounted to less than last year's bumpercrop, shows a 47 per cent increase in farmvalue. Record production was made in rye,white and sweet potatoes, and hay. Allcrops, based on their farm value December 1,are worth $7,572,890,000, or $1,842,978,000more than their value in 1921. Cotton, to-bacco, and grains are enjoying the most satis-factory prices, whereas the potato crop, thoughconsiderably larger than last year's, is worth34 per cent less.

The areas sown to winter wheat and to ryethis fall were 46,069,000 acres and 5,508,000acres, reductions compared with last year of3.2 per cent and 11.3 per cent, respectively.The condition of winter wheat on December 1was 79.5, as compared with 76.0 a year ago anda 10-year average of 87.9. Drought retardedgrowth and reduced expected acreage of wheatand other fall-sown grains in some sections ofdistrict No. 10 (Kansas City). However, inthe larger areas of the grain-producing regions,where conditions during the fall were favorableto rapid growth, the wheat has gone into thewinter in excellent condition. Winter cropshave been making good progress in districtNo. 8 (St. Louis) and in district No. 12 (SanFrancisco). Reports from all the cereal-pro-ducing States of the former district show lessHessian-fly damage than usual, owing to gen-eral observance of fly-free dates in seeding. Thegreater portion of the corn crop is housed andunusually large quantities are being cribbed forfeeding on farms.

Grain Movements.November grain receipts at 17 interior cen-

ters showed the usual seasonal decline, butamounted to 103,497,694 bushels, or 76 percent more than a year ago. Receipts of wheattotaled 43,779,375 bushels, a decrease of only10 per cent, compared with October, and showedactual increases at Omaha and St. Louis.Corn receipts were 24,021,799 bushels, 66 percent above the November average for the years1919-1921. Receipts of rye maintained theirunprecedented level and, as a result of largelyincreased receipts at Chicago, approximated theOctober total.

Cotton.The final estimate of the cotton crop is

9,964,000 bales, a reduction of 171,000 bales

from previous estimates. Although materiallysmaller than the average for recent years, theyear's crop is the fourth most valuable evergrown. On December 20 the price of middlingupland at New Orleans was 26 cents, as com-

Sared with 25.87 cents on November 15.otton ginned prior to December 1 amounted

to 9,318,144 bales, as compared with 7,639,961bales and 10,141,293 bales during the corre-sponding periods in 1921 and 1920. Stockson hand at mills and public warehouses onNovember 30 totaled 5,919,520 bales, as com-pared with 6,948,300 bales a year ago. In-creased shipments of cotton abroad during thelast few months have been in part responsiblefor the gain in total exports.

The Oklahoma State Board of Agriculturereports an estimated saving to cotton growersof $24,000,000 through the campaign againstthe weevil during the fall of 1921 and the springof 1922. The fight is to be continued through-out the cotton regions of the Southwest, andsimilar campaigns are planned against thechinch bug and Hessian fly by bankers andbusiness men cooperating with the farmers.

Tobacco.The December estimate places the tobacco

crop at 1,324,840,000 pounds, representing afarm value of $306,162,000. The increasedvalue compared with last year is a result bothof the larger yield and of higher prices whichprevailed m all markets. Total sale for pro-ducers previous to December 1, 1922, are esti-mated at 166,600,589 pounds—about 51 percent of the estimated production.

Cigar manufacturers in district No. 3 (Phila-delphia) report a slight seasonal slackening ofdemand, but appreciably less than is usualduring the month. The holiday business hasbeen very large, in excess of 1921 according tothe majority of cigar makers. Owing to thesmall stocks held by jobbers and dealers, thepresent rate of production will probably con-tinue during January, as some manufacturerswill be glad to accumulate a stock of cigars.Prices have remained firm, with slight advanceson cigars imported from the West Indies.Prices of leaf tobacco have also held firm andrange from 15 to 40 per cent higher than lastyear, with relatively better prices beingobtained for common and medium than forfine grades. No scarcity of any grade oftobacco except Havana is reported. Thequality of Connecticut shade-grown leaf hasturned out to be much better than was antic-ipated earlier in the fall, and has been boughtvery heavily during the month.


10 FEDERAL BESERVE BULLETIN. JANUARY, 1933.

Fruit.

Shipments of citrus fruit from Californiaduring November, 1922, were slightly greaterthan during the same month last year. Theprice of oranges was considerably lower thanduring October or November, 1921, but ashortage of lemons maintained lemon prices ata high level. The condition of the fruit inFlorida has been improved by cooler weatherin recent weeks. There is an active demandat satisfactory prices, and shipments fromFlorida are in excess of those of last year, inspite of continued reports of shortage of re-frigerator cars. The apple crop in district No.12 (San Francisco) has been unusually slow incoming to market, first on account of carshortage and now because growers are unwill-ing to market their fruit at prevailing prices,which are low as a result of the large supply ofapples in the East.

Live stock.

Movement of live stock to market showedthe usual seasonal decline, but was very muchheavier than during the corresponding periodin 1921. Receipts of cattle and calves, hogs,sheep, horses, and mules were larger than thoseof last November, but hog receipts alone reg-istered an increase over last month. Novem-ber receipts of cattle and calves decreased 21per cent as compared with last month, and re-ceipts of sheep decreased 29 per cent, whilereceipts of hogs increased 24 per cent.

Improvement in the condition of cattle andof ranges is reported from all stock-raisingdistricts, and was particularly marked in dis-trict No. 11 (Dallas). A fairly general rainfallin Texas has benefited pasturage, and thisimprovement, accompanied by mild weather,has lessened the necessity for feeding. Thecondition of live stock in district No. 8 (St.Louis) is exceptionally good. Reduced re-ceipts during November at the principalmarkets in district No. 10 (Kansas City) indi-cate an abatement in the heavy movement ofcattle from the southwest range country.However, the situation is still grave, as therains and snows came too late to benefit theranges, and the supply of feed grown is insuffi-cient for the winter. In Oklahoma improvedwheat pasture and mild weather have donemuch to counteract the effects of scarce andhigh-priced feeds. Range conditions in. dis-trict No. 12 (San Francisco) were greatly im-proved by rains and light snows of Novemberand early December, and live stock are reportedto have entered the winter in good condition.Winter feeding has begun and, with few excep-

tions, supplies of hay are ample in this district.The movement of stockers and feeders to thecountry is not as heavy as in October, butheavier than a year ago, and demand, espe-cially in the Pacific Northwest, continues togain strength. Broader demand for the bettergrades of stocker and feeder cattle was a sig-nificant feature of the November trade in dis-trict No. 11 (Dallas).

MINING.Coal.

Operations at coal mines have been main-tained at a high level ever since September.November production of bituminous coal totaled45,262,000 tons, as compared with 45,154,000tons in October and 35,955,000 tons in Novem-ber, 1921. Despite the drastic curtailment forfour months due to the strike, aggregate bitu-minous production has been almost as largein 1922 as in 1921, although much smaller thanin other recent years. Production is still muchhampered by car shortage, particularly in theWest Virginia and Kentucky fields. The coldweather in December brought an active de-mand for steam coal from large industrial usersand also from householders who are unable tosecure anthracite. Sales of high volatile gascoals, on the other hand, diminished in theearly part of December, as railroads and publicutilities had covered their immediate needsand shipments through the Lakes were stoppedfor the season. As a result of this variationin demand, district No. 3 (Philadelphia) re-ports that the price of steam coals increasedabout 50 cents a ton during December, whilethe quotations for high volatile gas coals werefrom 25 cents to $1 a ton lower.

Production of anthracite coal amounted to8,385,000 tons in November, as compared with8,530,000 tons in October and 6,859,000 tonsin November, 1921. The mine output in thefirst two weeks of December was at a slightlyhigher rate than in November and is the largeston record for this season of the year. Car sup-ply has been reasonably adequate, althoughdistrict No. 3 (Philadelphia) reports that thepoor condition of cars and locomotives in theScranton district has caused some mines toreduce their output. As a result of the decisionof the United States Supreme Court that theKohler Act is unconstitutional, several minesunder the city of Scranton have resumed opera-tions. Some price advances were recorded atmines and retail yards during December, butthese tend to be small on account of the closesupervision of Government agents.

Manufacture of beehive coke expanded 30per cent during November, while the output of


JANUABI, 1923. FEDERAL RESERVE BULLETIN. 11

by-product plants was 4 per cent larger than inOctober. This increased supply is being rapidlyabsorbed by industrial users, who have been in-creasing their operations, and by retail coaldealers who are selling it to householders as asubstitute for anthracite coal. The result ofthis enlarged demand was the ending of thedecline in coke prices which had continued forfour months and an upward movement in thethird week of December.

Petroleum.Average daily production of petroleum con-

tinues to increase and totaled 1,596,000 bar-rels in November, as compared with 1,524,000barrels in October. Stocks of oil at the end ofNovember totaled 275,856,000 barrels, whichwas an increase of 1,418,000 barrels for themonth. The number of new wells completedincreased from 1,388 in October to 1,450 inNovember. The number of new wells com-pleted in district No. 10 (Kansas City) in-creased by 58 during November, and the dailynew production showed an increase of 16 percent for the month. Drilling operations, how-ever, showed a slight seasonal decline, from2,370 rigs and wells on November 1 to 2,307 onDecember 1. The daily average productionin the States of Kansas, Oklahoma, Wyoming,and Colorado increased 7 per cent during No-vember. Productive activity also increasedin district No. 12 (San Francisco). Dailyaverage production was 8 per cent larger inNovember than in October, while new produc-tion showed an increase of 16 per cent. Con-sumption was slightly higher than in October,but stocks showed a further accumulation.

The petroleum fields of district No. 11 (Dal-las) report a reduction of activity duringNovember. The daily average production forthe entire district was 7 per cent smaller thanin October, most of the curtailment occurringin the Texas coastal field. The number ofnew wells completed decreased by 67 in Novem-ber and the initial production was 14 per centless. Price advances were reported early inDecember in the North Louisiana district, andthe price of Mexia oil was raised from $1.25per barrel to $1.35 per barrel on December 15.

There has recently been a considerable de-cline in the demand for gasoline and asphalt,but other refinery products are selling well.Sales of lubricating oils have been increasingsteadily for several months, as a result ofimprovement in the general industrial situa-tion. Demand for kerosene has also beenstrong, as a result of extensive use of smallheating stoves this winter.

Metals.The copper market has been strong during

December, and prices have shown a distinctupward tendency. Refined electrolytic copperdelivered at New York was quoted at 14.625cents on December 19, as compared with 13.90cents on November 20. This advance inprices is ascribed to a steady decline in thequantity of surplus metal, to the rise in sterlingexchange, and to the reported negotiationsconcerning a loan to Germany. Mine produc-tion of copper totaled 102,593,000 pounds inNovember, which was 1 per cent less than inOctober, but over four and one-half times aslarge as in November, 1921.

The price of zinc softened considerably inthe last week of November, but showed somerecovery in December. Lead prices, on theother hand, were well maintained until thethird week of December, when imports fromMexico and Canada caused some weakeningin the demand. Production of slab zincaggregated 40,200 tons in November, an in-crease of less than 1 per cent, while the produc-tion of lead was about 3 per cent greater thanin October. District No. 10 (Kansas City)reports that there was a marked improvementin prices of both zinc and lead ores duringNovembe •, which resulted in increased miningoperations, Shipping facilities have been muchimproved, due to an arrangement with therailroads by which coal gondola cars are usedto ship metal ore east.

Silver production was further curtailed inNovember and aggregated 4,869,905 ounces,which was 6 per cent less than in October and12 per cent less than the maximum output ofAugust. Factory consumption of tin was 14per cent less in November than in October.

MANUFACTURES.Food products.

Production of wheat flour during Novemberamounted to 13,424,000 barrels, comparedwith 13,581,000 barrels in October and 10,166,-000 barrels in November, 1921. Production of11 leading mills in district No. 8 (St. Louis) was385,306 barrels, the largest output for anymonth this year, and an increase of 5 per centand of 48 per cent as compared with lastmonth and November last year. Demand,both foreign and domestic, was very slack,however, until after the first week in Decem-ber, when advances in the price of wheat stim-ulated buying. Thirty millers in district No.7 (Chicago) produced 386,195 barrels of flour,increases of 4.5 per cent and 49 per cent ascompared with last month and November, 1921.



District No. 10 (Kansas City) reports a totaloutput of 2,014,252 barrels, a decrease of 2.5per cent compared with last month, but anincrease of 27 per cent compared with the cor-responding period a year ago. A moderateexport demand was reported, but domestic buy-ing was curtailed by uncertainty as to deliveryand by the approach of the inventory period.In district No. 9 (Minneapolis) production offlour increased from 3,057,988 barrels in Octo-ber to 3,103,178 barrels in November, which is33 per cent larger than last November's output.

Fifty packing companies in the UnitedStates reporting to district No. 7 (Chicago)show a decrease of 22.4 per cent in dollar salescompared with October, but an increase of16.7 per cent over a year ago. The same con-dition prevails in district No. 10 (Kansas City),reflecting decreased slaughtering operations.Hog purchases by packers, however, were 20.8per cent more than during October, and thelargest number purchased in any month sinceJune. With wholesale prices of all meats, ex-cept lamb, relatively low, the packers reportan increased demand for their products, owingto increased employment and improved busi-ness conditions. Export demand also con-tinues active and reduced shipments are theresult of limited supplies. Consigned stocks oflard already abroad continue to decline be-cause of the rapidity in the sale of consign-ments on arrival, and unusually heavy demandfor fats was a feature of the month's trade.Cold-storage supplies are lower than they havebeen for some months, but stocks of pork andlard at Kansas City showed an increase com-pared with last month and with a year ago.

Textiles.Although a slight seasonal check has been

noted in the buying of many textile products,demand is still good, and production has beenmaintained at a high point. In fact, manymills throughout the country have been operat-ing night shifts, and the consumption of rawcotton by mills during November totaled577,561 bales, which, with the exception ofJanuary, 1920, is the largest figure attainedsince November, 1917. Furthermore, the vol-ume of unfilled orders on the books of manyof the mills on November 29 was reported bydistricts No. 3 (Philadelphia), No. 5 (Rich-mond), and No. 6 (Atlanta) to be sufficient toinsure production at close to capacity for thenext few months. In the Atlanta districtunfilled orders for goods were smaller than atthe end of October, but those for goods andyarns exceeded the corresponding figures for

November 30, 1921, by 77 per cent and 114per cent, respectively. Production and ship-ments by the same mills were greater thanduring October and from 20 to 50 per centlarger than during November of last year.Stocks, on the other hand, were smaller. Re-ports from finishers of cotton fabrics fromvarious sections of the country indicate that alarger volume of business was done in Novemberthan in October.

In woolen textiles, also, production increasedduring November, as indicated by statistics ofraw wool consumption and of active machinery.Woolen spindles were no more active than inOctober, but considerably more so than duringlast November. Worsted spindles, on theother hand, continued the recovery from lastspring's slump and were 90 per cent active inNovember. The greatest improvement oc-curred in loom activity—both the wide andthe narrow looms were over 80 per cent active,the highest point reached since the spring of1920. The mill consumption of wool duringNovember was 63,313,000 pounds, expressedin terms of grease equivalent, showing an in-crease of 6.8 per cent above the figure forOctober, and an increase of 18 per cent abovethat for last November. District No. 3 (Phila-delphia) reports that in spite of the usual mid-winter lull, evident in December, sufficientorders had been previously booked by spinnersto keep nearly all available spindles in oper-ation. Furthermore, finished stocks are low.The raw wool market in district No. 7 (Chicago)was active during November, but shipmentsfrom Chicago were only two-thirds of those ofOctober. Prices of raw wools, particularly themedium grades, and also of yarns, have re-mained firm since their recent rise.

Deliveries of raw silk to American millsduring November, 35,467 bales, although 6 percent less than in October, exceeded all figuresrecorded for previous months. Imports felloff from the maximum reached in October, butwere larger than deliveries, and stocks in ware-houses attained a new high point of 47,159bales. The demand for both broad and thrownsilk was greater this fall than a year ago, andmill production in district No. 3 (Philadelphia)averaged about 75 per cent of capacity early inDecember. Reports from the Philadelphiadistrict, however, indicate that there was somerecession in demand, largely seasonal, afterNovember 15. Loom activity among the millsin Paterson was slightly higher on December 16than on November 18, and in the North Hudsonsection during the same period there wasalso an increase in operations. The raw silk


JANDAHY, 1923. FEDERAL RESERVE BULLETIN. 13

market, according to reports from district No.3 (Philadelphia), has weakened since November1, and rising prices were halted. Quotationson finished goods were also lowered.

Seasonal declines occurred in the demandfor clothing during November, according toreports from districts No. 2 (New York), No.7 (Chicago), and No. 8 (St. Louis). Data fromthe New York district indicate that the salesof women's clothing are relatively better thanthose of men's apparel, as the former showedan increase of 54 per cent as compared withNovember, 1921, whereas the latter decreased 7per cent. Orders booked, production, andshipments by seven tailors to the trade in dis-trict No. 7 (Chicago) were all less than thecorresponding figures for October, but about70 per cent above those for November of lastyear.

Production of underwear by 33 mills duringNovember increased 14 per cent as comparedwith October. Unfilled orders increased 20per cent and shipments 15 per cent. Pro-duction by 49 mills totaled 599,891 dozens, ascompared with 702,614 dozens by 57 mills inNovember, 1921, giving about the same aver-age output per mill. Mills in district No. 3(Philadelphia) reported decreases in produc-tion both as compared with October and withNovember, 1921. Orders booked for winterunderwear, however, were over four times aslarge and unfilled orders were nearly five timesas large as a year ago. Shipments were alsolarger than during last November.

Statistics showing conditions in the hosieryindustry in districts No. 3 (Philadelphia) andNo. 6 (Atlanta) indicate better business inNovember than during both October and thepreceding November. Fewer orders werebooked in October by the Philadelphia districtmanufacturers, but as compared with a yearago this item doubled in both districts, and thevolume of unfilled orders on hand at the endof the month was larger, although both ship-ments and cancellations have also increased.Iron and steel.

The iron and steel industry continues to re-port great activity. Mill operations averagedabout 80 per cent of capacity in the latter partof December, as compared with 70 per cent ofcapacity a month previously. Production of

Eig iron mounted from 2,638,000 tons in Octo-er to 2,850,000 tons in November, while out-

put of steel ingots increased from 2,872,000tons to 2,889,000 tons. The market for steelstrengthened during December as a result of asteady flow of new orders for delivery in the

25691—23 2

first quarter of 1923 and of improvement inshipping facilities and labor supply. Manyrailroad embargoes have been removed, and thecar supply is more adequate, so that the ac-cumulated tonnage in mill yards is beingrapidly reduced. The scarcity of commonlabor nas been somewhat relieved, due to theseasonal reduction in farm work, but numer-ous wage increases and bonus payments arereported.

Sales of pig iron were heavy during the firstweek of December, and the large demand re-sulted in a rise in price quotations. Foreigniron continues to be received at Atlantic ports,but has not seriously diminished the businessof domestic producers. Finished steel productsare also moving well in district No. 3 (Phila-delphia), although there is some reduction instructural steel sales to builders. Orders forsheets continue to exceed shipments at bothPittsburgh and Chicago, and demand for wireand nails in December were exceptionally largefor a winter month. Production, shipments,and new orders of stoves and furnaces in dis-trict No. 7 (Chicago) declined considerably inNovember, but were each over twice as largeas in November, 1921. November sales ofagricultural implements were also larger thanin the corresponding month of 1921, althoughonly about one-half as large as in October.Manufacturers of wire rope, stoves, farm imple-ments, railway supplies, and boilers in districtNo. 8 (St. Louis) all reported sales in Novemberhigher than those a year ago, the increasesranging from 18 per cent for boilers to 42 percent for wire rope.

Automobiles.

Production and shipments of automobilesfailed to show their usual seasonal decline inNovember, and have only moderately cur-tailed their schedules during the first half ofDecember. The output of passenger carsaggregated 215,408 in November, an increaseof 0.6 per cent, while the production of 20,876trucks was 1.4 per cent greater than the Octo-ber total. Factory shipments of automobileswere only slightly smaller than in October andwere twice as large as in November, 1921.Automobile body manufacturers in districtNo. 4 (Cleveland) report that many orders forfuture shipment are being received, and thatthere is no noticeable decline in factory opera-tions. Sales of truck manufacturers are quiteirregular and companies are reducing theirproduction schedules.

Tire manufacturers are still maintainingheavy schedules, as the increased use of closed


14 FEDERAL, BESEBVE BTJLX.ETIN. JANCABY, 1923.

cars is resulting in much winter driving,which is particularly hard on tires. Low tireprices have reduced the repairing of old tiresand increased the consumption of tires per carduring the past year.Leather and shoes.

Prices of Chicago packer hides droppedsharply in the first week of December, with theresult thai the volume of sales totaled 570,000in a single week. Calf and goat skins arealso lower, although the imports of goat skinsfrom China are unusually small. Prices of NewZealand sheepskins are still very high andsales have been curtailed.

Sole'leather production was 4 per cent lessin November than in October, but most ofthis difference was due to the greater numberof working days in October. Both produc-tion and sales of leather increased in districtNo. 7 (Chicago) and sales were larger than ayear ago. In district No. 3 (Philadelphia)sales of most kinds of leather decreased inNovember, due to the desire to reduce inven-tories. Tanners of sheepskins are operatingtheir plants at capacity. Hat and chamoisleather continue to sell freely and demand forfleshings by glove manufacturers is increasing.Belting sales declined slightly in November,but recovered in the early part of December.

Patent leather and suede leather continueto be in general demand for women's shoes.Various designs of cut-outs are the prevailingstyle feature. Manufacturers in district No. 8(St. Louis) report that men's shoes are inbetter demand than women's, due to uncer-tainty as to spring styles. Shoe productiondeclined in November, but the daily rate ofproduction was higher than in October in dis-tricts No. 3 (Philadelphia) and No. 7 (Chicago).Reports from 22 retail shoe stores in the Phila-delphia district show that sales were slightlylarger in November than in October and thatthe rate of turnover during the last fivemonths was considerably higher than m thecorresponding period of 1921.

Paper.Production of newsprint during November

totaled 127,983 tons, a decrease of 2 per centfrom the figure for October and an increase of10 per cent above that for November of last,year. Shipments exceeded production, andstocks were consequently reduced.

October statistics, the latest available forwood pulp and the other grades of paper, showseasonal increases in production, shipments,and consumption of wood pulp. The last two

items reached the highest point in over twoyears, and stocks on hand at the end of Octo-ber were the smallest recorded in the last fouryears. The production of all of the importantgrades of paper was considerably larger thanduring any month of 1921, and all except news-print and paperboard exceeded previous figuresfor 1922.

Reports from district No. 3 (Philadelphia)indicate a seasonal decline in orders bookedby paper manufacturers during December, butmost of the mills were operating at capacityon accumulated orders, and a fairly large num-ber of future orders were being received.Wholesalers in district No. 7 (Chicago) reportthat November sales and stocks on hand atthe end of the month were larger than forNovember, 1921. Consumption of paper indistrict No. 4 (Cleveland) was large in Novem-ber, but orders placed with mills fell off inDecember, preceding the merchants' inven-tory period.

Lumber.

Unusual activity for late fall was noted inthe lumber market during November andearly December. With weather favorable forconstruction, with active buying on the partof railroads, automobile plants, furniture man-ufacturers, and other industrial users, andwith improved transportation facilities, ship-ments from the mills continued to be largethroughout that period. Although goodweather permitted production to be main-tained at a high point, the output of a numberof associations was exceeded by their ship-ments. Orders were also received by the millsat a steady rate until the middle of December,but about that time some recessions in buyingwere reported from various local markets.Prices of both the softwoods and the hard-woods advanced during the month endingDecember 15.

Production during November by 572 millstotaled 1,235,748,000 feet, as compared with1,306,047,000 feet by 564 mills in Octoberand 812,900,000 feet by 475 mills during lastNovember. Business among the mills of theSouthern Pine Association in districts No. 6(Atlanta) and No. 11 (Dallas) was particularlygood during November. Both shipments andorders booked exceeded production in the At-lanta district, and all three of these items werelarger than the corresponding figures for Octo-ber and last November. In district No. 7(Chicago) purchasing of new railroad equip-ment was the feature of the lumber industryduring November, but the building and indus-


JANDABT, 1923. FEDERAL RESERVE BULLETIN. 15

trial demand continued to be strong. Westernproducers suffered more from transportationdifficulties than did the mills in the South.Hence shipments from the associations in dis-trict No. 12 (San Francisco) were curtailedduring November, and figures of productionindicate the usual seasonal declines. All items,however, materially exceeded those of Novem-ber, 1921. Unfilled orders of most of theassociations at the end of November werefairly large.

BUILDING.

Building operations in November wereunusually large for that season of the year,due to a marked revival in residential con-struction. The total value of contractsawarded in seven Federal reserve districts(compiled from statistics gathered by theF. W. Dodge Co.) aggregated $219,351,000during November, which was only 1.3 percent less than in October and was 24 per centgreater than in November, 1921. Decreasesfrom October totals were recorded in theBoston, Philadelphia, Cleveland, and Chicagodistricts, ranging from 0.03 per cent in districtNo. 1 (Boston) to 17.2 per cent in district No.3 (Philadelphia). Increases were reported bythe New York, Richmond, and Minneapolisdistricts, the largest amounting to 19.5 percent in district No. 2 (New York). The valueof residential contracts let increased in Novem-ber for all districts, except Philadelphia andRichmond, and totaled $117,515,000 for theseven Federal reserve districts. Statistics ofnumber and value of building permits arepublished on page 100.

Building material prices continued to riseduring November and reached the highestlevel since January, 1921. Shipments ofcement were much smaller than in Octoberand production was slightly curtailed. Brickoutput has been very large this fall, and dis-trict No. 3 (Philadelphia) reports that manu-facturers have sufficient orders on hand tokeep plants operating at capacity for severalweeks.

TRANSPORTATION.

Traffic congestion was materially relievedduring November. The average car shortagein the last week of the month was 133,786cars, as compared with 179,239 cars in the lastweek of October. The shortage of box carswas reduced about 26 per cent, while theshortage of coal cars was reduced over 9 percent. There was an increase in the supply

of cars and locomotives, due to a reduction inthe amount of bad-order equipment and to anincrease in the production of new cars andlocomotives. The number of freight carsawaiting repairs on December 1 was 226,288,which was 9.5 per cent less than on November1, and 34 per cent less than the maximum for1922 on August 1. The production of loco-motives in November totaled 159, an increaseof 9.6 per cent. The volume of unfilled ordersfor locomotives, which has shown an almostuninterrupted growth since January, con-tinued to accumulate.

Car loadings decreased 4.6 per cent inNovember, but this compares with an averagedecrease of 17.4 per cent from October toNovember in the three preceding years. Themost substantial reductions occurred in theloadings of ore and of miscellaneous mer-chandise. Coke loadings increased 18 percent and were the largest in the year, whileloadings of forest products, grain, and coalshowed less pronounced gains. The loadingsof all the railroad operating groups, exceptthe Pocahontas, decreased during November.The most marked reduction was reported bythe northwestern railroads and amounted toabout 15 per cent.

TRADE.Wholesale trade.

Owing to the shortness of the month and aseasonal slackening of buying by retailers inmany lines, wholesale trade was less duringNovember than in the preceding month. Therecessions in groceries, however, were so smallas to be attributed in most cases to thesmaller number of business days in November.The greatest declines in sales below theOctober figures occurred in dry goods, shoes,and auto supplies. As compared with No-vember, 1921, reports from all districts indicateincreases in practically every line. The onlyexceptions were found in the case of shoes anddrugs. Sales of the former were smaller thanduring the same month last year in districtsNo. 2 (New York), No. 6 (Atlanta), and No. 7(Chicago), but were materially larger in someof the other districts. Drug sales declined indistricts No. 8 (St. Louis) and No. 10 (KansasCity), but in district No. 2 (New York) werelarger than for any November of the threepreceding years. Trading in hardware andfurniture snowed increases of from 2 to 25per cent as compared with November of lastyear, and sales of farm implements more than


16 FEDERAL RESERVE BUT.T.ETIN. JANOABT, 1923.

doubled in districts No. 10 (Kansas City) andNo. 11 (Dallas). The dry goods business wasin most instances materially larger than a yearago, and groceries were moderately so. Thetable on page 105 gives detailed figures of whole-sale trade.Retail trade.

Retail distribution during November was inslightly smaller volume than during October,but was materially larger than during thecorresponding period last year. The usualdecline in November sales of clothing waspartially counteracted by the increases inChristmas buying during the month. Improvedemployment conditions and generally higherwages, together with increased distribution ofChristmas savings funds have been contributeing factors in the larger volume of holidaytrade this year. Although utility goods arestill in the greatest demand, a marked increasein purchases of luxuries is reported. A surveyof department store sales during the first 14days of December, 1922 and 1921, made by theFederal Reserve Bank of New York, shows anincrease of 8 per cent over last year, the sameas the November percentage of increase overthe corresponding period in 1921. This wouldindicate that holiday sales have increased inabout the same proportion as ordinary sales.As compared with last month, department storesales decreased in districts No. 2 (New York),No. 6 (Atlanta), No. 9 (Minneapolis), No. 11(Dallas), and No. 12 (San Francisco). In-creased sales as compared with last Novemberwere reported in all Federal reserve districtsexcept district No. 9 (Minneapolis). Increasesranged from 0.4 per cent in district No. 11(Dallas) to 16 per cent in districts No. 4(Cleveland) and No. 7 (Chicago). Stocksincreased during the month in all districtsexcept No. 5 (Richmond), No. 10 (KansasCity), and No. 11 (Dallas). Compared with thecorresponding date last year, stocks weresmaller in all districts except No. 1 (Boston),No. 2 (New York), No. 5 (Richmond), andNo. 9 (Minneapolis). The rate of turnovercontinues to increase, while the ratio of out-standing orders to purchases for 1921 droppedfrom 8.2 to 7.4 during November.

PRICES.

There were varying indications of the trendof wholesale prices in the United States duringNovember. According to the index of theFederal Reserve Board prices fell 1 point,from 165 in October to 164 in November,

whereas the Bureau of Labor Statistics indexshowed an increase of 2 points, from 154 inOctober to 156 in November.

Both indexes, however, showed that almostall agricultural products were still increasing,particularly wheat and cotton. Coal, coke, andpig-iron prices continued their decline. Therise which has occurred in steel products sinceearly spring came to an end with a Novemberdrop in most items, except rails, which con-tinued to advance.

I t was in the consumers' goods group thatthe main difference between the two indexesoccurred. The Federal Reserve Board indexshowed that this group remained unchanged,whereas prices of finished goods in the Bureauof Labor index as recomputed by the boardshowed an increase of 3 points.

The movement of food prices was mainly up-ward—flour, sugar, coffee, tea, butter, eggs,and apples increasing. There were also in-creases in the prices of cotton and woolencloths.

The groups of the Bureau of Labor Statisticsindex moved as follows: Farm products up 5points, cloths and clothing up 4 points, foods,chemicals and drugs and house furnishings up3 points each, bunding materials and miscel-laneous commodities up 2 points, fuel and light-ing down 8 points, and metals and metal prod-ucts down 2 points.

COMMERCIAL FAILURES.

Commercial failures during November werefewer in number, and the liabilities involvedwere less than during November, 1921. A sea-sonal increase over the October data occurredin both items. The figures are still rather largeas compared with those of 1920 and prior years,but are well below the average for the earlymonths of this year. Liabilities for all dis-tricts during November totaled $40,265,297,showing an increase of 16 per cent over theOctober figure and a decline of 25 per cent be-low that of last November. Liabilities weresmaller than during October only in districtsNo. 1 (Boston), No. 9 (Minneapolis), and No.10 (Kansas City). As compared with a yearago, they were larger in districts No. 1 (Boston),No. 2 (New York), No. 3 (Philadelphia), andNo. 8 (St. Louis). The greatest increasewithin the past year was 24 per cent in districtNo. 2 (New York), and the greatest decline,amounting to 68 per cent, occurred in districtNo. 10 (Kansas City). Other large decreasesin liabilities were 48 per cent in district No. 6


JANDAEI, 1923. FEDERAL RESEEVE BULLETIN. 17

(Atlanta), 63 per cent in district No. 9 (Minne-apolis), and 61 per cent in district No. 11(Dallas). It will be noted that the four above-mentioned districts are all in agricultural sec-tions. The number of failures exceeded thecorresponding data for November, 1921, onlyin districts No. 1 (Boston), No. 8 (St. Louis),and No. 12 (San Francisco). The number forall districts totaled 1,737 during November,1,708 during October, and 1,988 during Novem-ber, 1921. Detailed figures are given in thetable on page 93.

EMPLOYMENT.

Industrial concerns in all parts of the UnitedStates reported further increases in numbersof employees during November. The UnitedStates Employment Service reports that 1,428firms added 44,653 employees in November,as compared to an increase of 52,867 employ-ees in October. In the three months periodending November 30 these concerns increasedtheir forces by 126,188, or about 8 per cent.Increases were reported in November by 12of the 14 major industrial groups, and theonly serious reduction occurred at plantsmanufacturing stone, clay, and glass products.The eastern industrial districts report a strongdemand for many types of skilled labor andfor common labor, whereas the agriculturaldistricts report a growing surplus of commonlabor.

Employment in the textile and shoe facto-ries of district No. 1 (Boston) increased sub-stantially in November. The constructionindustry continued to be active, and shortagesof craftsmen were reported from many partsof the district. There was also a seriousshortage of metal and machine workers inConnecticut, but the machine factories ofother New England States were working atconsiderably less than capacity. Jewelry andsilverware factories continued to be operatedat capacity, and chair and cordage factorieswere working overtime. In district No. 2(New York) unemployment has practicallyceased, due to increases in employment inalmost all reporting lines. The New YorkState Department of Labor reports thatthe number of workers at reporting establish-ments increased 2 per cent in November. InNew Jersey all skilled silk workers are nowfully employed and there is a general shortageof building mechanics. A rather general laborshortage developed during November in dis-trict No. 3 (Philadelphia). There was ascarcity of male workers in the building trades,

and of cabinet makers and woodworkers,while factories manufacturing textiles, paperboxes, and tobacco reported a shortage offemale workers. The demand for commonlabor far exceeds the supply. The Pennsyl-vania State Department of Labor reportsthat there were further reductions in unem-ployment in the cities of eastern Pennsylvaniam the first half of December, which averagedabout 30 per cent. Shortages of car builders,machinists, and other classes of steel workerswere reported from district No. 4 (Cleveland)during November. Brick manufacturing plantswere operating at close to capacity, and rubberand farm implement factories were unusuallyactive for the fall season.

Cotton mills in district No. 5 (Richmond)made further additions to their forces in No-vember. There were also increases in numberof employees at establishments manufacturingfood, metal products, tobacco, lumber, andfertilizer. A considerable supply of commonlabor is available as a result of the seasonal re-duction in agricultural activity. Textile mills,lumber mills, and coal mines in district No. 6(Atlanta) continued to increase the number oftheir employees during November. There issome surplus of labor in Florida, as many tran-sient workmen have arrived recently fromother States.

Eeports from 162 firms in district No. 7(Chicago) showed an increase of 2.2 per centin number of employees. There was a de-crease of 0.9 per cent in the average pay perworker during November, due to an mcreasein the proportion of unskilled workers. Thechief gains in employment occurred at metalmills and at tanneries. Seasonal reductions inemployment were reported by tailoring estab-lishments and manufacturers of knit goods andapparel. In district No. 8 (St. Louis) employ-ment at shoe factories and meat-packingestablishments reached in November thehighest total for the current year. Railroads,lead and zinc mines, and steel mills also in-creased their forces. Flour mills have reducedthe number of their employees in both the St.Louis and Minneapolis districts, due to ashortage of shipping facilities. Many agricul-tural laborers m district No. 9 (Minneapolis)have been employed at lumber camps since theclose of the harvest. Plants manufacturingbuilding materials and mining machinery indistrict No. 10 (Kansas City) increased theirforces in November and are now operating atcapacity. Sugar factories and farms, on theother hand, are releasing a considerable numberof workers.



Textile mills, metal factories, railroad shops,and oil companies in district No. 11 (Dallas)increased the number of their employees duringNovember. Surpluses of building craftsmenand of common labor were reported. A sur-plus of unskilled labor has also developed inmany sections of district No. 12 (San Fran-cisco), on account of the seasonal decline ofagricultural work and fruit canning. Lumbermills in California report some shortage oflabor, while those in Washington are reducingtheir forces.

FOREIGN TRADE.

A further increase during November in thevalue of goods exported from the United Statesbrought the figures for that month to the high-est level reached since March, 1921. The No-vember total of $383,000,000 represents an in-crease of $12,000,000 over the preceding monthand of $89,000,000 over November, 1921.Compared also with the monthly average of$311,000,000 during the first 10 months of 1922,the latest export figures are distinctly favorable.For the 11 months ending with November the1922 total is somewhat lower than for the sameperiod of 1921, but is approximately 55 per centhigher than for 1913. Import figures are notyet available for October or November, 1922,on account of delavs in compiling the reportssince the new tariff law went into effect.

GOLD AND SILVER MOVEMENTS.

Net gold imports for November, $14,877,000,show a considerable increase over the corre-sponding October figure of $3,274,000, thoughfalling below the average of about $20,000,000for the preceding 10 months. Of the gross goldimports of $18,308,000 for the month, $11,763,-000 came from England, $1,911,000 fromFrance, and $1,368,000 from China. Smalleramounts of gold imports for the month, all be-low $1,000,000, are credited to Canada, Mexico,and Egypt. Of the gold exports for Novem-ber about 64 per cent, or $2,193,000, were con-signed to Canada, considerable shipments goingalso to Colombia and Hongkong. Net goldimports for the 11 months ot the present yeartotaled $214,565,000, compared with $637,853,-000 for the corresponding period in 1921.Net imports of gold since August 1, 1914,totaled $1,756,654,000, as shown in the follow-ing exhibit:

[In thousands of dollars.l

Aug.

JanJan.

1, 1914, to Dec. 31,19181 to Dec. 31,1919.. .1 to Dec. 31,19201 to Dec. 31,1921...1 to Nov. 30,1922

Total

Imports.

1,776,61676,534

417,068B91.248248,730

3,210,196

Exports.

705,210368,185322,09123,89134,165

1,453,542

Excess ofimports.

1,071,406i 291,651

94.977667,357214,565

1,756,654

i Excess of exports.

Both silver imports, $5,855,000, and silverexports, $6,599,000, were larger in Novemberthan in October and were in excess of the aver-age for the preceding 10 months. Silver im-ports for the month came largely from Mexicoand Canada, while silver exports were con-signed largely to the Far East and England.Figures for the 11 months of the present yearshow net silver imports of $7,065,000, com-pared with net imports of $13,296,000 for thecorresponding period in 1921, but as againstlarge excesses of exports for the correspondingperiods in 1918 and 1919, when large amountsof silver were shipped to India and China, andas against normal moderate excesses of exportsfor the pre-war years. This change is due tothe working of the Pittman Act, under whichthe Government has purchased, at a fixed rateof $1 per ounce, practically the entire silveroutput of the country. In view of the muchlower price of silver prevailing in the inter-national market, no silver of domestic extrac-tion has been exported during the past twoyears. On the other hand, some silver of for-eign origin has been used in the domestic arts,and this accounts for the excess of silverimports over exports shown for the presentyear and for 1921.

Net exports of silver since August, 1914,totaled $436,196,000, as may be seen from thefollowing exhibit:

[In thousands ol dollars.]

Aug. 1, 1914, to Dec. 31,1918Jan. 1 to Dec. 31,1919Jan. 1 to Dec. 31,1920Jan. 1 to Dec. 31,1921Ian. 1 to Nov. 30,1922

Total

Imports.

203,59289,41088,06063,24262,959

507,263

Exports.

483,353239,021113,61651,57555,894

943,459

Excess ofexports.

279,761149,61125,556

'11,667>7,065

136,196

1 Excess of imports.


JANOABY, 1923. FEDERAL RESERVE BUI/LETIN. 19

RULINGS OF THE FEDERAL RESERVE BOARD.Amendment to Regulation B.

On December 19, 1922, the Federal ReserveBoard transmitted to Federal reserve banks itsRegulation B, Series of 1922, supersedingRegulation B, Series of 1921. The board'sletter of transmittal and the amended regula-tion are set forth below:

WASHINGTON, December 19, 1922.The Federal Reserve Board transmits herewith its

Regulation B, Series of 1922, superseding Regulation B,Series of 1921, relating to open-market purchases byFederal reserve banks of bills of exchange, trade accept-ances, and bankers' acceptances under section 14 of theFederal reserve act.

This new regulation is issued for the purpose of per-mitting Federal reserve banks until further notice topurchase in the open market, with or without the in-dorsement of member banks, bankers' acceptances withmaturities not in excess of six months which are drawnby growers, or by cooperative marketing associations com-posed exclusively of growers, of nonperishable, readilymarketable, staple agricultural products, to finance theorderly marketing of such products grown by such growersand secured at the time of acceptance by warehouse,terminal, or other similar receipts issued by parties in-dependent of the borrowers and conveying security titleto such products. This purpose is effected by the addi-tion of a new paragraph at the end of Part II of said regula-tion, and the addition of this paragraph constitutes theonly amendment to the regulation.

The board was moved to take this action by a desire toprovide more ample facilities for financing the orderlymarketing of staple agricultural products, especially bycooperative marketing associations. This is in accord-ance with the principle heretofore recognized by theboard that the carrying of agricultural products for suchperiods as are reasonably necessary in order to assist theorderly marketing thereof is a proper step in the processof distribution. There is a material distinction, however,between carrying agricultural products for such periods asare reasonably necessary to effect orderly marketing, andmere speculative withholding from the market in the hopeultimately of obtaining a higher price. Before pu chasingsuch acceptances, therefore, Federal reserve banks shouldassure themselves that the agricultural products underlyingthe transaction are not being held for speculation but arebeing marketed in an orderly manner or stored as part ofthe process of orderly marketing. Care should also beexercised by Federal reserve banks in purchasing accept-ances of long maturities, in order that the liquidity ofthe aggregate investments held by them should not beaffected.

By order of the Federal Reserve Board.WH. W. HOXTON, Secretary.

REGULATION B, SERIES OF 1922.(Superseding Regulation B of 1921.)

OPEN MARKET PURCHASES OF BILLS OF EX-CHANGE, TRADE ACCEPTANCES, AND BANKERS'ACCEPTANCES UNDER SECTION 14.

I. General statutory provisions.Section 14 of the Federal reserve act provides that Fed-

eral reserve banks under rules and regulations to be pre-scribed by the Federal Reserve Board may purchase andsell in the open market, at home or abroad, from or to do-mestic or foreign banks, firms, corporations, or individuals,bankers' acceptances, and bills of exchange of the kindsand maturities made eligible by the act for rediscount,with or without the indorsement of a member bank.

I I . (leneral character of bills and acceptances eligible.

The Federal Reserve Board, exercising its statutory rightto regulate the purchase of bills of exchange and accept-ances, has determined that a bill of exchange or accept-ance, to be eligible for purchase by Federal reserve banksunder this provision of section 14, must have been ac-cepted by the drawee prior to such purchase unless it iseither accompanied or secured by shipping documents orby warehouse, terminal, or other similar receipt conveyingsecurity title or bears a satisfactory banking indorsement,and must conform to the relative requirements of Regula-tion A, except that—

(a) A banker's acceptance growing out of a transactioninvolving the importation or exportation of goods may bepurchased if it has a maturity not in excess of six months,exclusive of days of grace, provided that it conforms inother respects to the relative requirements of RegulationA;

(6) A banker's acceptance growing out of a transactioninvolving the storage within the United States of goodsactually under contract for sale and not yet delivered orpaid for may be purchased, provided that the acceptor issecured by the pledge of such goods; and provided further,that the acceptance conforms in other respects to the rela-tive requirements of Regulation A; and

(c) A banker's acceptance drawn by a grower, or by acooperative marketing association composed exclusivelyof growers, of nonperishable, readily marketable, stapleagricultural products, to finance the orderly marketing ofsuch products grown by such grower or growers and securedat the time of acceptance by a warehouse, terminal, orother similar receipt, issued by a party independent ofthe borrower and conveying security title to such products,may be purchased if it has a maturity at the time of pur-chase not in excess of six months, exclusive of days ofgrace; provided, that the acceptor remains securedthroughout the life of the acceptance, and that the accept-ance conforms in other respects to the relevant require-ments of Regulation A.

III. Statements.A bill of exchange, unless indorsed by a member bank,

is not eligible for purchase until a satisfactory statementhas been furnished of the financial condition of one ormore of the parties thereto.

A banker's acceptance, unless accepted or indorsed bya member bank, is not eligible for purchase until the ac-ceptor has furnished a satisfactory statement of its financialcondition in form to be approved by the Federal reservebank and has agreed in writing with a Federal reservebank to inform it upon request concerning the transactionunderlying the acceptance.



LAW DEPARTMENT.Petition for rehearing denied in Richmond par clearance

case.The Supreme Court of North Carolina, on

December 13, 1922, dismissed the petition ofthe plaintiffs for a rehearing in the case ofFarmers & Merchants Bank et al. v. FederalReserve Bank of Richmond, 112 S. E. 252,and has reaffirmed its former decision dis-missing the injunction issued by the lowercourt against the Federal Reserve Bank ofRichmond and declaring unconstitutional theact of the Legislature of North Carolina ratifiedFebruary 5, 1921, which sought to authorizeState banks to impose exchange charges on,and remit by exchange drafts for, checks for-warded through Federal reserve banks.

The court dismissed the petition by a merememorandum decision and did not modify orsupplement its former opinion, which was pub-lished in the FEDERAL RESERVE BULLETIN forJune, 1922 (page 175 of the short edition andpage 701 of the final edition).

Exercise of fiduciary powers by national banks located inPennsylvania.Below is the opinion of the Superior Court

of Pennsylvania rendered November 23, 1922,in the case of the Estate of Edna FrisbieTurner, upholding the right of national banksto act in fiduciary capacities in the State ofPennsylvania:IN THE SUPERIOR COURT OF PENNSYLVANIA.Estate of Edna Frisbie Turner. Nos. 232, 233, 234, Octo-

ber term, 1922. Appeals of Corn Exchange NationalBank of Philadelphia, individually and as guardian ofestates of Dudley B. Turner, jr., and Edna FrisbieTurner, minors, from decree of Orphans' Court of Phila-delphia County. Nos. 99 and 100. Filed Nov. 23, 1922.Opinion by LINN, J.:This appeal challenges the refusal to approve a national

bank as a fiduciary. Approval was denied on the singleground that the Federal legislation conferring fiduciarypowers on national banks is "in contravention of the lawand.established practice of this Commonwealth."

The question arose in distributing the estate of EdnaFrisbie Turner, deceased, letters testamentary having beengranted in 1920. Her minor children were beneficiariesunder her will. In 1921 the court below appointed theRittenhouse Trust Co., a corporation of Pennsylvania,guardian of the estates of the minors. On May 3, 1922,the account of the executors came on for adjudication.It showed a balance for the minors. The executors' peti-tion for distribution stated that since its appointment asguardian the Rittenhouse Trust Co. was converted into anational bank, and, thereafter was consolidated into theCorn Exchange National Bank. Distribution to the bank,as guardian, was therefore asked.

In referring to the subject, the auditing judge said: " Inthe matter of the National Bank of Germantown, 30 Dis-trict Rep. 603, it appears that this court has refused torecognize or approve national banks for appointment asfiduciaries by this court. It does not appear that the

I merged corporation Corn Exchange National Bank hasbeen approved by this court for appointment as a fiduciary.The award to the Turner minors will therefore be maclesubject to the merged corporation being approved, and inthe event of their failing to obtain the approval of thiscourt, the award will be payable to a succeeding guardianwhen duly appointed and' qualified."

Accordingly the bank then filed a petition drawn pur-suant to the proper rule of court, setting forth its incorpora-tion under the national banking law, various facts con-cerning its management and assets, and the consolidationwith the Rittenhouse National Bank, formerly the Ritten-house Trust Co.; that it was authorized by*the FederalReserve Board to transact a general fiduciary business;had complied with the law of Pennsylvania governing thetransaction of such business; had accepted the provisionsof the act of May 9, 1889, P. L. 159, and also of the act ofMay 20, 1921, P. L. 991, making itself subject to super-vision and examination by the Banking Department ofPennsylvania the same as corporations of Pennsylvania.A number of evidential exhibits were attached to the peti-tion, among them a stipulation under rule 21, by which theapplicant "hereby stipulates and undertakes irrevocablythat securities and other property received by the corpora-tion both in a fiduciary capacity and from the person orpersons for whom it is surety shall not be taken out of thejurisdiction of the court and shall be kept separate andapart from all money, securities, and property of the saidbank so that the same can at all times be easily identifiedas belonging to the estate of the person or persons for whoseaccount the same has been received, and that the trustfunds received by said bank, either as fiduciary or for theperson or persons for whom it is surety, shall be depositedin a separate account in a bank or banks or trust companyor trust companies other than said Corn Exchange NationalBank of Philadelphia, of good standing in PhiladelphiaCounty."

On the same day the petition was refused for reasonspreviously given in the case of the National Bank ofGermantown (supra). From that refusal this appeal toNo. 232, October term, 1922, was taken.

Three days later, the bank, as guardian of the estates ofthe children, filed another petition setting forth that pur-suant to "the adjudication of the executors' account,"its petition for approval as fiduciary under rule 21 hadbeen filed and dismissed; that it was advised by counselthat by specified acts of Congress with the approval of theFederal Reserve Board, it was authorized to transact afiduciary business, and having accepted the provisions ofapplicable State law specified, it was "fully qualified andauthorized to continue to act as guardian of the estates ofDudley B. Turner, jr., and Edna Frisbie Turner, minors,and in all other fiduciary capacities, and that the dismissalof the petition for approval under Rule 21 was withoutlegal justification or authority." Petitioner asked for anorder directing the executors to pay to it as guardian of theestate of the minors, the money awarded to them by theadjudication. By supplemental adjudication, this peti-tion was dismissed for the reasons previously given. Ex-ceptions to these adjudications were then filed; after theywere dismissed, two appeals were taken, one by the bankas guardian, the other individually (Nos. 233 and 234,October term, 1922). The appeals were argued togetherand shall be so disposed of.

As no particular or special objection to petitioner ismade, we need consider in the light of the record the prob-lem as thus stated by the court below: "The question is,therefore, raised as to whether this court should approvethem (national banks) ior appointment in fiduciary capaci1-ties and accept them as surety. We should approve themunless the Federal acts are in contravention of the law and


JANUAB5T, 1 9 2 3 . FEDERAL BESERVE BULLETIN. 21

established practice of this Commonwealth:" In re Na-tional Bank of Germantown, 30 District Reports, 603.

The act of Congress approved December 13, 1913,enacted that "The Federal Reserve Board shall beauthorized and empowered * * * (k) to grant byspecial permit to national banks applying therefor whennot in contravention of State or local law, the right to actas trustee, executor, administrator, or registrar of stocksand bonds under such rules and regulations as the saidboard may prescribe" (c. 6, sec. 11, par. k. 38 Stats. 251;U. S. Comp. Stats. 1918, s. 9794). Later some definitionof the words "In contravention of State or local law"became desirable, and was supplied by an amendment ofSeptember 26, 1918 (40 Stats. 967, U. S. Comp. Stats. 1918Suppl. 9497 k). It was as follows: "(k) To grant byspecial permit to national banks applying therefor, whennot in contravention of State or local law, the right to actas trustee, executor, administrator, registrar of stocks andbonds, guardians of estates, assignee, receiver, committeeof estates of lunatics, or in any other fiduciary capacity inwhich State banks, trust companies, or other corporationswhich come into competition with national banks arepermitted to act under the laws of the State in whichthe national bank is located.

"Whenever the laws of such State authorize or permitthe exercise of any or all of the foregoing powers by Statebanks, trust companies, or other corporations whichcompete with national banks, the granting to and theexercise of such powers by national banks shall not bedeemed to be in contravention of State or local law withinthe meaning of this act.

"National banks exercising any or all of the powersenumerated in this subsection shall segregate all assetsheld in any fiduciary capacity from the general assets ofthe bank and shall keep a separate set of books and recordsshowing in proper detail all transactions engaged in underauthority of this subsection. Such books and recordsshall be open to inspection by the State authorities to thesame extent as the books and records of corporations orgau-ized under State law which exercise fiduciary powers,but nothing in this act shall be construed as authorizingthe State authorities to examine the books, records, andassets of the national bank which are not held in trustunder authority of this subsection.

"No national bank shall receive in its trust departmentdeposits of current funds subject to check or the depositof checks, drafts, bills of exchange, or other items for col-lection or exchange purposes. Funds deposited or heldin trust by the bank awaiting investment shall be carriedin a separate account and shall not be used by the bankin the conduct of its business unless it shall first set asidein the trust department United States bonds or othersecurities approved by the Federal Reserve Board.

"In the event of the failure of such bank the owners ofthe funds held in trust for investment shall have a lien onthe bonds or other securities so set apart in addition totheir claim against the estate of the bank.

"Whenever the laws of a State require corporationsacting in a fiduciary capacity to deposit securities withthe State authorities, for the protection of private or courttrusts, national banks so acting shall be required to makesimilar deposits and securities so deposited shall be heldfor the protection of private or court trusts, as provided bythe State law.

"National banks in such cases shall not be required toexecute the bond usually required of individuals if Statecorporations under similar circumstances are exempt fromthis requirement.

"National banks shall have the power to execute suchbond when so required by the laws of the State.

"In any case in which the laws of a State require that acorporation acting as trustee, executor, administrator, orin any capacity specified in this section, shall take an oathor make an affidavit, the president, vice president, cashier,

or trust officer of such national bank may take the neces-sary oath or execute the necessary affidavit.

" I t shall be unlawful for any national banking associa-tion to lend any officer, director, or employee any fundsheld in trust under the powers conferred by this section.Any officer, director, or employee making such loan, or towhom such loan is made, may be fined not more than$5,000 or imprisoned not more than five years, or may beboth fined and imprisoned, in the discretion of the court.

"In passing upon applications for permission to exercisethe powers enumerated in this subsection, the FederalReserve Board may take into consideration the amountof capital and surplus of the applying bank, whether ornot such capital and surplus is sufficient under the cir-cumstances of the case, the needs of the community to beserved, and any other facts and circumstances that seemto it proper, and may grant or refuse the application accord-ingly; provided, that no permit shall be issued by anynational banking association having a capital and surplusless than the capital and surplus required by State law ofState banks, trust companies, and corporations exercisingsuch powers."

Since Congress has provided that if the State law author-ize or permit the exercise of * * * (guardianship)by State banks, trust companies, or other corporationswhich compete with national banks, ' 'the granting to andthe exercise of such powers by national banks shall not bedeemed to be in contravention of State or local law withinthe meaning of this act," the decision of these appealsmust depend on whether Pennsylvania permits such com-peting corporations to act in that capacity; if the Statelaw so provides, the national bank must be permitted toenjoy fiduciary powers. As familiar State laws confer thatpower on such corporations, the learned court below mis-interpreted the acts of Congress in holding them to be incontravention of the State law.

The Federal legislation is constitutional, First NationalBank v. Fellows, 244 U. S. 416, and the congressionalpower is plenary. Except as Congress permits, a Statecan not stand in the way of corporate activity so author-ized by Congress; such authority confers immunity fromState interference, legislative or judicial; N. P. R. Co. v.North Dakota, 250 U. S. 135, and Telephone Co. v. SouthDakota, 250 U. S. 163; Second Employers' Liability cases,223 U. S. 1; P. & R. Rwy. Co. v. Polk, 256 U. S. 332,335.

The effect of the amendment of 1918 on the act of 1913,as a mere rearrangement of the words will show, was toauthorize the Federal Reserve Board to grant by specialpermit to national banks applying therefor (having therequired "capital and surplus," supra), the right to act inany fiduciary capacity in which State banks or other corpo-rations which come into competition with national banksare permitted to act under the laws of the State in whichthe national bank is located, whenever the laws of such Stateauthorize or permit the exercise of any or all such powers byState banks or other corporations competing with nationalbanks. The congressional definition or determination ofwhat shall not be considered in contravention of State law,for the purposes of the enactment, takes no account of thefact that details of administration in the Federal systemmay or may not differ from administrative matters pre-scribed in the State system. Congress was the sole judgeof the means appropriate to the end to be accomplishedby the exercise of this additional power conferred onnational banks; Congress knew that throughout the Stateswidely divergent systems of fiduciary law prevailed. Theadministrative differences in which the court below founddecisive conflict between State and Federal law may beimportant elements in the competition for business andin the market may or may not operate in favor of the Statecorporations, but these differences in themselves are notsufficient to deprive a national bank of the enjoyment offiduciary powers, and particularly is that so in the circum-stances disclosed by this record. See First National Bank


22 FEDERAL RESERVE BULLETIN. JANUARY, 192.'i.

v. Fellows (supra); People v. Russell, 283 111. 520, comparedwith the prior decision of the same court in People v.Brady, 271 111. 100; Woodbury's Appeal, 78 N. H. 50;Hamilton v. State, 94 Conn. 648; Stanchfield's estate, 171Wis. 553; In re Mollineaux, 179 N. Y. Supp. 90; Fidelity,etc., Trust Company v. Enright, 264 Fed. 236.

The first reason given to support its conclusion that theFederal statute was in contravention of the State lawwas based on comparison of provisions of the two Bystemsconcerning the deposit of trust funds. The Federal pro-vision has been quoted. For the State, the acts of May 9,1889, P. L. 159, and June 27, 1895, P. L. 402, provide thatsuch "companies shall keep all trust funds and invest-ments separate and apart from the assets of the companies,and all investments made by the said companies as fidu-ciaries shall be so designated as that the trust to whichsuch investments shall belong shall be clearly known."In addition, we are advised the State banking departmentrequires trust funds to be deposited in a separate bank.The acts of Congress and the State laws are not alike, buta difference in permitted corporate management does notestablish that the Federal statute is in contravention ofthe State law in the light of the explicit congressionaldefinition of those words, and the difference is furtherunimportant in the decision of this case, because the recordshows that petitioner has agreed to comply with the Statelaw on the subject. The petition also contains a stipula-tion whereby petitioner irrevocably covenants with thecourt below pursuant to rule 21, that it will not removesecurities or other property by it held in a fiduciarycapacity out of the jurisdiction of the court and that itwill deposit trust funds in a separate account with anotherbank or trust company.

The second point of alleged conflict the court found bycomparing the part of section 11 k (supra), authorizingexamination by State examiners of the affairs of a nationalbank, with the State law of May 21, 1919, P. L. 209, pro-viding in section 14 (a) for examination by State exam-iners; but the record shows that petitioner has stipulatedboth with the court and with the State banking depart-ment that the State banking department shall make likeexamination of all its property and assets as is made inthe case of State banks. The record also shows that peti-tioner has filed a stipulation with the banking departmentto be and remain subject to supervision by that depart-ment to the same extent as State corporations pursuantto the act of May 20, 1921, P. L. 991, entitled "Restrictingthe appointment of corporate fiduciaries by testators or byany court or register of wills to corporations fully subject tosupervision and examination by the banking department.''

The learned court below found its third conflict "inthe case of insolvency or suspension of a national bank."The Federal law provides that in such cases the Comp-troller of the Currency appoint a receiver who, under thedirection of the comptroller shall take possession, admin-ister, etc., pursuant to appropriate judicial action. Thepractice has long prevailed and is well understood. Thecourt remarks that such receiver will not be under thecontrol of the State courts. But, as to the court below,it would seem that the Federal court supervising a receiver-ship under the national banking law is neither more norless foreign than a State court supervising a receiverappointed by the banking commissioner administering theaffairs of a State bank pursuant to State law.

It was for Congress to determine whether the details ofcorporate management prescribed by it were better adapt-ed for the exercise of the plenary Federal power it desiredexerted, than other methods of corporate administrationeffective in the States, but its provisions for the conductof business or the administration in insolvency, thoughdifferent from the State system, can not be regarded as incontravention of State law within the terms of the amend-ment of 1918.

The orders appealed from are reversed and the recordremitted with instructions to enter an order consistent,with this opinion.

Porter, J., dissents.Gawthrop, J., did not hear the argument and did not

participate in the decision.

Right of Federal reserve bank to charge back forgedGovernment check.Below is printed the opinion of the Circuit

Court of Appeals for the Second Circuit,rendered October 31, 1922, by Hon. Martin T.Manton, circuit judge, in the case ofClosterNational Bank v. Federal Reserve Bank ofNew York, upholding the right of the Federalreserve bank to charge to the member bank theamount of a check on the Treasurer of theUnited States, returned by the TreasuryDepartment because of forgery.

The Federal Reserve Bank of New Yorkreceived for collection from the Closter NationalBank a check on the Treasurer of the UnitedStates. The check was duly credited and for-warded for payment. More than a year laterthe Federal reserve bank was notified that thecheck was a forgery. Thereupon the amountof the check was charged to the Closter NationalBank, which then brought an action against theFederal reserve bank to recover this amount.

The court held that under the terms of thecollection agreement as contained in a circularletter issued by the Federal reserve bank, thelatter could at any time and unconditionallycharge back the amount of this check to theCloster National Bank and, therefore, judg-ment was entered for the Federal reservebank.UNITED STATES CIRCUIT COURT OF APPEALS

FOR THE SECOND CIRCUIT.CLOSTER NATIONAL BANK, plaintiff in error, 1

against IFEDERAL RESERVE BANK OF NEW YORK, |

defendant in error. JBefore: ROGERS, MANTON, and MAYER, circuit judges.Writ of error from the United States District Court for the

Southern District of New York. Action by plaintiffagainst the defendant to recover the amount of a checkdrawn on the Treasurer of the United States.

Judgment for defendant; plaintiff appeals. Affirmed.MANTON, circuit judge.On March 31, 1919, a check was drawn on the Treasurer

of the United States purporting to be for $4,000. It waspresented to the plaintiff in error by one representinghimself to be the payee therein named, and it was endorsed"Pay to the order of any bank or trust company. March31, 1919. Endorsements guaranteed. The Closter Na-tional Bank, Closter, N. J." This paper was sent on April3, 1919, to the defendant in error for collection. Theplaintiff in error was a member of the second Federalreserve district located outside of the State of New York,and elected to collect the check in question through thedefendant in error, but did so under the terms and condi-tions of a circular letter known as No. 37, dated December29, 1915, and which reads as follows:


.lA.VOAKT, 1 9 2 3 . FEDERAL RESKRVE BULLETIN. 23

"Member banks of this district located outside of thecity of New York are notified that on and after January 1,1916, they may include in their remittances to the FederalReserve Bank of New York for immediate credit at par,but subject to final payment by the Treasurer of the UnitedStates, all Government warrants and checks drawn on theTreasurer of the United States. Member banks situatedin New York City for the present and until further notifiedby us are requested to collect such items through theassistant treasurer of the United States in New York inaccordance with the present practice. When the facilitiesof the Federal reserve bank for handling Governmentdeposits have been further developed, member banks inNew York City will be notified that Government warrantsand checks may be sent to this bank through the clearinghouse subject to final payment by the Treasurer of theUnited States.

"The Government has for many years exercised theright of returning at any time warrants and checks, whichfor any cause have not been considered good; and we havebeen advised that this practice will be continued.

"In view of this situation the Federal Reserve Bank ofof New York, as a condition of receiving Government war-rants and checks on the Treasurer of the United Statesfrom member banks for credit, reserves the right to chargeback and return to the depositor at any time and uncon-ditionally any such item deposited with the FederalReserve Bank of New York.

"Your attention is specially invited to the above condi-tion."

The check was entered to the credit of the account ofthe plaintiff in error in defendant in error's bank. It wasthereupon forwarded to the Treasurer of the United Statesfor payment. The check passed through in ordinarycourse and after bore a signature and symbol number, andthen the check was perforated as follows: " Paid 4-4-19-M9." The signature of the drawer was compared and, indue course and in accordance with the usual custom, itwas audited by the disbursing officer who issued it, andit was examined by the Inspector General of the Army.Upon this audit and examination the Treasurer of theUnited States notified the defendant in error by letter ofMay 19, 1920, over a year after the deposit of the checkby the plaintiff in error with the defendant in error forcollection, that the check had been altered and the in-dorsement of the payee forged. This letter sent to thedefendant in error was accompanied by a photostatic copyof the check in question and a request was made that theTreasurer of the United States be credited with the amountof the item. In accordance with the practice prevailingin the bank of the defendant in error the Treasurer wascredited with the item of $4,000 and within 30 daysthereafter he was paid this amount. The plaintiff inerror was notified by the defendant in error of the Treas-urer's statement that the check was forged and altered,and there was forwarded to the plaintiff in error, with itsphotostatic copv of the check, a notice of the charge ofthe amount to tne plaintiff in error's account. Thereuponthe plaintiff in error objected to the charge and deniedliability for the forgery. It resulted in the present action.

The contract between the parties embraces the con-tents and obligations imposed by the circular letter No. 37.The defendant in error was appointed depository and fiscalagent of the United States, and it offered to certain mem-ber banks of the second Federal reserve district the optionof presenting for payment checks and warrants on theTreasurer of the United States through it, but it madethe terms as set forth in the circular above. The plaintiffin error was free to accept or refuse to accept the servicesof the defendant in error as it saw fit. It might have usedother available means for collecting Government checksand warrants if it so desired. While immediately credit-ing the account of the plaintiff in error with the defendant

in error, it was always subjected to final payment by theTreasurer. Crediting the account accorded an advantageto the member banks in affording means for making fundspromptly available. In undertaking this service, thedefendant in error became a collecting agent. Under theterms of the circular, defendant in error had the right,should the United States at any time not pay, to returnsuch check for any reason which the Government mightconsider good, and the defendant in error could at anytime an<i unconditionally charge back the amount cred-ited to the plaintiff in error, at the same time returningthe item so charged back. The right to do so was indefiniteas to time; it might be done at any time and uncondi-tionally. It was with this understanding and agreementthat the defendant in error gave credit and accepted theobligation to perform this service for the plaintiff in error.

But it is contended that the defendant m error's right tocharge back the item is dependent upon its showing thatthe item was in fact a forgery and alteration as claimed bythe Treasurer. By the terms of the collection agreementunder which the defendant in error performed the service,the collection agent had the right, if it acted in good faith,to charge back the item to the plaintiff in error's accountwithout the necessity of establishing a forgery or alterationof the warrant. The memorandum credit accorded by theagreement of which the circular letter is a part, was alwaysqualified by the clause "subject to final payment." Andby that clause the Government has for many years exer-cised the right of returning at any time, warrants andchecks which, for any cause, have not been considered goodand the plaintiff in error was notified that this practicewould be continued as a condition of receiving Govern-ment warrants and checks on the Treasurer of the UnitedStates from member banks for credit, with "the right tocharge back at any time and return to the depositor at anytime and unconditionally any such item deposited withthe Federal reserve bank." To place any other construc-tion upon the terms of the circular would be to treat thephrase quoted as surplusage. Under the law the Treasurermight recover if he paid the warrant because of the for-gery and therefore, as a matter of law, the item was notfinally paid.

In the United States v. Exchange National Bank (214U. S. 302) the United States was held not to be chargeablewith knowledge of the signatures of persons entitled topension checks and that it could recover from a bank re-ceiving payment from a subtreasury on checks to whichthe names of payees had been forged.

In Cooke v. United States (91 U. S. 389) the court laiddown the rule governing the right of the Treasurer to re-pudiate payments of counterfeiting items, and said that ifpresentation is made at the time when a complete exami-nation can not be had, such payment is tentative and doesnot amount to an adoption, and that further inquiry maybe made and if the paper is found to be a counterfeit, itmay be returned within a reasonable time and that areasonable time is dependent upon the circumstances ofeach particular case; but that until a reasonable time hasin fact elapsed, the law will not impute negligence onaccount of delay.

And in the instant case, this warrant was presented at atime when the War Department was in a great rush of busi-ness owing to an accumulation incident to the conduct ofthe war.

In Onondaga Bank v. United States (64 Fed. 703) theGovernment was allowed to recover after two years hadelapsed between payment and discovery of the forgery.We think the plaintiff in error may not recover under anyof the terms of the contract under which the service ofcollection was performed, nor may it recover against thedefendant in error by reason of any neglect or unreasonabledelay on the part of the defendant in error.

Judgment affirmed.



State Banks and Trust Companies.Admissions.

The following list shows the State banks and trustcompanies which were admitted to membership in theFederal reserve system during the month ending December31, 1922, on which date 1,652 State institutions weremembers of the system:

Capital, i Surplus.

District No. 6.Farmers & Merchants Bank, <

Eatonton, GaDistrict No. 8.

City Trust Co., St. Louis, Mo iLaclede Trust Co., St. Louis, Mo.}

District No. 10. [Bankers Trust Co., Denver, Colo... 1,000.000 ;

$25,000

200,000 i200,000 !

$45,000 i35,000

.Total re-sources.

$26,257

1,820, 5181.69S.849

250,000 4,265,518

Voluntary liquidation.—Farmers & Merchants Bank, Rupert, Idaho.Withdrawal.—Merchants & Planters Bank, Whitecastle, La.Bank closed.—Bank of Hanson, Hansen, Idaho.

New National Bank Charters.The Comptroller of the Currency reports the following

increases and reductions in the number and capital ofnational banks during the period from November 25 toDecember 29, 1922, inclusive:

New charters issuedRestored to solveneyIncrease of capital approved

Aggregate of new charters, bants restored tosolvency, and banks increasing capital

LiquidationsReducing capital

Total liquidations and reductions of capital..

Consolidations of national banks under act of Nov.7,1918

Aggregate increased capital for periodReduction of capital owing to liquidations, etc

Net increase

Num-ber ofbanks.

236

45

123

15

1

Amountof

capital.

$875,00050,000

8,615,000

9,540,000

1,450,000150,000

1,600,000

200,000

9,540,0001,600,000

7,940,000

Fiduciary Powers Granted to National Banks.During the month of December the Federal Reserve

Board approved applications of the national banks listedbelow for permission to exercise one or more of the fiduciarypowers named in section 11 (k) of the Federal reserve actas amended, as follows:

1. Trustee.2. Executor.3. Administrator.4. Registrar of stocks and bonds.5. Guardian of estates.6. Assignee.7. Receiver.8. Committee of estates of lunatics.9. In any other fiduciary capacity in which State banks,

trust companies, or other corporations which come intocompetition with national banks are permitted to act underthe laws of the State in which the bank is located.

The numerals opposite the name of each bank indicatethe power or powers it is authorized to exercise, as givenbelow:

Washington, N. J .Salem, N. JWaynesboro, Pa...Mount Carmel, Pa.Charlotte, N. C . . .Greenville, S.C....Miami Beach, Fla.

Alexandria, Minn.Hutchinson, Minn.Joplin, MoWenatchee, Wash..

Dis- itrictNo. !

233355 !6 i

1012

Name of bank.

First National BankCity National BankCitizens National BankFirst National BankCharlotte National BankWoodside National BankMiami Beach First National

Bank.First National BankFarmers National BankJoplin National BankFirst National Bank

Powersgranted.

I to9.Uo9.1 to 9.1 to 9.1 to 9.1 to 9.Ito9.

1 to 9.1 to 9.Ito9.Ito9.

Election of Directors.

The following directors of Federal reservebanks have been elected for the three-yearterm beginning January 1, 1923:District No. 1—Boston:

Class A—Frederick S. Chamberlain, Xew Britain,Conn.

Class B—E. R. Morse, Proctor, Vt.Class C—Jesse H. Metcalf, Providence, R. I.

District No. 2—New York:Class A—Gates W. McGarrah, New York, N. Y.Class B—Owen D. Young, New York, N. Y.Class C—Pierre Jay, New York, N. Y.

District No. 3—Philadelphia:Class A—John C. Cosgrove, Johnstown, Pa.Class B—Alba B. Johnson, Philadelphia, Pa.Class C—H. B. Thompson, Wilmington, Del.

District No. 4—Cleveland:Class A—Chess Lamberton, Franklin, Pa.Class B—R. P. Wright, Erie, Pa.Class C—L. B. Williams, Cleveland, Ohio.

District No. 5—Richmond:Class A—John F. Bruton, Wilson, N. C.Class B—Edwin C. Graham, Washington, D. C.Class C—Robert Lassiter, Charlotte, N. C.

District No. 6—Atlanta:Class A—Oscar Newton, Jackson, Miss.Class B—W. H. Hartford, Nashville, Tenn.Class C—W. H. Kettig, Birmingham, Ala.

District No. 7—Chicago:Class A—Chas. H. McNider, Mason City, Iowa.Class B—S. T. Crapo, Detroit, Mich.Class C—F. C. Ball, Munice, Ind.

District No. 8—St. Louis:Class A—John C. Martin, Salem, 111.Class B—W. B. Plunkett, Little Rock, Ark.Class C—C. P. J. Mooney, Memphis, Tenn.

District No. 9—Minneapolis:Class A—Theodore Wold, Minneapolis, Minn.Class B—F. R. Bigelow, St. Paul, Minn.Class C—George W. McCormick, Menominee, Mich.

District No. 10—Kansas City:Class A—Frank W. Sponahle, Paola, Kans.Class B—M. L. McClure, Kansas City, Mo.Class C—Fred O. Roof, Denver, Colo.

District No. 11—Dallas:Class A—W. H. Patrick, Clarendon, Tex.Class B—Marion Sansom, Fort Worth, Tex.Class C—Clarence E. Linz,1 Dallas, Tex.

District No. 12—San Francisco:Class A—C. K. Mclntosh, San Francisco, Calif.Class B—Elmer H. Cox, Madera, Calif.Class C—William Sproule, San Francisco. Calif.

1 Elected to fill unexpired term of VV. F. Ramsey, deceased. Termexpires Dec. 31,1923.


JANOARY, 1923. FEDERAL KESEEVE BTJUUETDST. 25

Federal Reserve Agents.

The Federal Reserve Board has redesignatedthe following-named class C directors as Federalreserve agent and chairman of the board ofdirectors of Federal reserve banks:

Boston—Frederick H. Ourtiss.New York—Pierre Jay.Philadelphia—R. L. Austin.Cleveland—D. C. Wills.Richmond—Caldwell Hardy.Atlanta—J. A. McOord.Chicago—Wm. A. Heath.St. Louis—Wm. McC. Martin.Minneapolis-John H. Rich.Kansas City—Asa E. Ramsay.Dallas—W. B. Newsome.San Francisco—John Perrin.

INTERBANK DEPOSITS.

Although the establishment of Federal reservebanks loosened the tie between country banksand their city correspondents, nevertheless thesecorrespondents still perform important func-tions for the country banks. Of these functionsthe one that is of greatest consequence fromthe point of view of the money market is theholding of country bankers' balances by thelarge banks in New York City and other finan-cial centers. These balances represent in themain funds not required at a given time by thebanks in the interior for the accommodation oftheir customers. These surplus funds are trans-ferred to New York, whence they can be recalledon demand, and where they draw interest atthe customary rate of about 2 per cent. Thecity banks keep these funds liquid by loaningthem out largely upon call against stock ex-change security. Part of these funds is loanedout by the New York banks on account of theircorrespondents, and amounts so loaned are de-ducted from the deposits of the out-of-townbanks, while another part is placed by the NewYork banks on their own account and is in-cluded in the total of amounts due to banksand bankers.

Statistics of amounts due to and due frombanks and bankers are available for all memberbanks on call dates and are shown in an at-tached table for every call date from June 30,1919, to June 30, 1922. Similar figures arealso available for reporting member banks inleading cities for every week and are shownbelow, by Federal reserve districts, for a periodbeginning with April 30, 1920. These figureshave never been printed before and are pre-

sented in full in order to be available for futurereference. A table is also given showing byweeks since April 2,1920, corresponding figuresand relevant selected items in the statement ofthe New York City member banks and of theNew York Federal Reserve Bank. While nostatistics of stock exchange loans are availablefor publication, it may be stated that in generalthe trend of these loans is closely parallel to thetrend of amounts due to banks and bankers.

The figures for all member banks on calldates show that the maximum amount ofinterbank deposits was reached in Novemberand December, 1919. The total amounts dueto other banks were over $4,000,000,000 atthat time. From this total the amounts de-clined until the end of April, 1921, whenthey stood at $2,665,000,000, but on June 30last they had advanced to $3,124,000,000. Byfar the larger part of the amounts due frombanks and bankers, it will be noted, is shownfor banks outside of New York City, and a largeproportion for banks outside of central reserveand reserve cities. The trend of this item isthe same as of amounts due to banks, but thetotal involved is much less, owing to the factthat a large part of the balances are due tononmember banks in the interior, which arenot included in the tabulation.

Balances of out-of-town correspondents withNew York City banks are an indicator of theextent of credit demand throughout the coun-try, as an increasing demand in the interiorresults in the withdrawal of New York bal-ances. The year 1920 was one of great creditstrain, and country correspondents were with-drawing their balances from the New Yorkbank in considerable amounts, although tem-porary and seasonal influences made the totalbalances move up and down throughout theperiod. The year 1921, on the other hand,was a year of liquidation during which coun-try banks kept their New York balances at afairly steady level, although toward the end ofthe year the balances increased. In 1922 thegeneral trend was upward with wide fluctua-tions.

I t may be noted that amounts due to corre-spondents constitute about one-fourth of de-mand deposits of the New York banks andare generally more than twice as large as theirtime deposits. The balances are considerablylarger than the reserve deposits kept by theNew York banks with the Federal reservebank, with the consequence that even relativelymoderate withdrawals of funds by outside cor-respondents frequently result in borrowing by



New York banks from their reserve bank.Thus withdrawals of bank balances from NewYork in 1920 were among the principal causesof the increase in borrowings at the reservebank. In 1921, however, no relationship be-tween the New York balances and the borrow-ings from the reserve bank can be traced.During that year liquidation of bank loanswas rapid and was effected by the retirementof Federal reserve notes, which declined byover $200,000,000 from the beginning of 1921to May, 1922, for the New York bank alone,and the importation of gold, which resultedin an increase of the gold reserves of the NewYork bank by over $600,000,000 during theperiod. In 1922, however, with the gold andnote accounts of the reserve bank showingmuch smaller changes, borrowings from thereserve bank are again affected by changes inout-of-town balances. During the early partof the year the balances increased and theborrowings from the reserve bank declined,while in the latter part of the year balancesshowed a general downward trend, as borrow-ings from the reserve bank increased.

Prior to the establishment of the reservesystem withdrawals of balances by out-of-town correspondents resulted in the calling ofloans by banks in New York and in the crea-tion of a serious money stringency, sometimes,as in the fall of 1907, amounting to panic.The New York Federal Reserve Bank partlyrelieves the member banks of the necessityof calling their loans to meet the strain causedby the withdrawal of balances. Instead ofcalling their loans the banks now borrow from

the reserve bank, thus reducing the fluctua-tions in the supply of funds on the New Yorkmarket.

INTERBANK DEPOSITS OF AIX MEMBER BANKS.

(Dates of calls.)

DCE TO BANKS AND BANKERS.

(In thousands of dollars.)

Date. I New YorkCity.

Other cen-tral reserveand reserve

cities.

Countrybanks.

June 30,1919Nov. 17,1919Dec. 31,1919May 4,1920June30,1920Nov. 15,1920Dec. 29,1920Apr.28,1921June30,1921Dec. 31,1921Mar. 10,1922June 30,1922

1,372,3141,389,3571,380,0961,207,4071,319,5751,113,9901,073,863

938,5771,018,7891,036,0661,060,7621,084,805

1,879,372 !2,169,4422,189.3671,887,4341,762,0991,732,2671,650,5361,425,1391,381,1831,499,3141,749,4391,706,183

398,816519,816521,937429,518379,342355,534337,905301,131288,124299,263331,761332,753 |

Total.

DUE FROM BANKS AND BANKERS.

Date.

June 30,1919.Nov. 17,1919.Dec. 31,1919.May 4,1920..June 30,1920.Nov. 15,1920.Dec. 29,1920.Apr.28,1921.June 30,1921.Dec. 31,1921.Mar. 10,1922.June 30,1922.

New YorkCity.

Other cen-tral reserveandreserve

cities.

290,255328,738350,571117,940 I130,689 i85,399 !91,535 !77,673 ;109,264 !72,123 :

65,205 ;72,546 !

Countrybanks.

958,8411,175,1251,121,866

867,652867,538854,056744,727622,141 i634,109697,108807,100826,193

875,9781,071,4931,046,272

888,581825,814834,871740,360625,172610,241680,406741,613748,034

3,650,5024,078,6154,091,4003,524,3593,461,0163,201,7913,062,3042,664,8472,688,0962,834,6453,141,9623,123,741

Total.

2,125,0742,575,3562,518,7091,874,1731,824,0411,774,3261,576,6221,324,9861,353,6141,449,6371,613,9181,646,773


JANUARY, 1923. FEDERAL RESERVE BULLETIN. 27

INTERBANK DEPOSITS OF REPORTING MEMBER BANKS.

(Last report date of each month.)

DUE TO BANKS AND BANKERS.

[In thousands of dollars.]

Date. Total, i Boston. New i Phila-York. Idelphia.

A*r. 30..May 28..June 25.July 30.

1920.2,080,8472,039,1552,016,8122,008,883

Aug. 27 ! 1,950,2361,991 3121,909,9751,889,909

Sept. 24Oct. 29.Nov. 26Dec. 31 t 1,974,432

1921. ;Jan. 28 1,878,194Feb. 25 1,843,703Mar.25 1,681,719Apr. 27 1,657,716May25 1,656,873June29 1,632,492July27 1,656,164Aug. 31 1,659,376Sept. 28 ! 1,643,295Oct. 26 | 1,678,579Nov.30 i 1,730,931Dec. 28 ! 1,703,752

1922. IJan.25 1,775,579Feb. 21 1,820,274Mar.29 1,802,172Apr.26 | 1,885,940May 31 I 1,982,731June 28 i 1,910,673July 26 | 1,950,752Aug. 30 ! 1,895,400Sept. 27 1,908,386Oct. 25Nov. 29Dec. 27

1,934,3031,923,0311,991,007

117,810110,647111,934117,269112,140114,382111,695105,863109,729

101,76696,82090,23098,00693,49391,50396,62688,21191,973100,67198,016100,896

104,637101,19398,714

113,333105,318104,962111,347104,224107,866110,222100,931112,768

1,053,044994,301985,966959,670919,903942,412901,815907,386997,538

882,028865,181794,501787,476801,506809,388799,079824,208809,547829,639

815,242

! 870,278848,374880,000926,106

1,019,593' 941,083! 963,192: 907,832; 897,117

932,547958,540910,261

141,713157,397158,615151,194151,032160,596163,719157,691153,628

147,489141,058133,770131,088125,831123,270127,647123,961127,796129,728133,582131,092

134,919133,836137,526143,147144,271145,332151,287142,478153,181150,132143,548159,308

Cleve-land.

57,13353,25949,38354,84457,87254,89857,03352,67552,776

48,07946,02639,96636,80636,79834,15936,57837,52134,65433,61029,99636,242

36,79635,11734,85933,93835,80138,12340,68742,84141,13538,25437,61735,176

Rich-mond.

35,14232,17431,38132,10432,60033,58522,28532,50526,746

29,91928,82323,97020,93021,50618,07619,37818,60819,65121,73322,70323,273

24,25224,81422,02823,31623,31723,05025,41320,34226,75730,44331,04330,790

Atlanta.

15,88713,00411,5769,6469,9579,9419,8899,0679,318

8,6499,4338,0318,0907,3887,4357,1506,5128,3097,4647,538

10,077

S,6309,002

10,4219,669

11,64010,98811,58411,69111,93412,95514,75215,549

Chicago.

325,564318,279320,821317,553321,131323,989304,890290,941305,870

321,049327,059297,874294,011292,223273,084282,394278,421271,331271,141269,515287,925

298,707337,380313,312323,216324,261330,699324,696332,299307,719304,138293,400348,175

St.Louis.

85,07383,59980,33982,67279,44969,68271,13872,31369,681

77,21275,54665,30963,73965,51258,57863,71960,75161,19763,09961,32664,915

'69,89980,80572,28975,41679,97077,78577,15075,12477,39678,49676,95185,897

Minne-apolis.

48,14442; 88830,87339,86737,02342,50936,44635,14335,736

33,48934,16035,13432,21228,78330,55328,19031,26330,38331,03332,52133,344

35,29236,84941,11839,42642,01339,16838,11038,73441,61942,66742,54548,175

KansasCity.

87,138123,215124,774135,851124,608122,499109,337107,046109,640

112,934113,64695,21695,77894,47294,755

104,728102,49891,56090,73885,46896,159

94,221104,92290,20898,517

102,288104,899108,860108,817110,785105,581102,628116,012

Dallas.

24,03521,94118,50418,84217,53619,58420,10019,38719,315

17,82817,43815,63913,72212,87111,61611,98710,54916,03315,27915,31816,518

15,46219,21619,39117,31017,77015,42015,00216,53529,73134,36329,99427,254

SanFran-cisco.

90,16488,45192,64689,37186,98597,235

101,62899,89284,455

97,75288,51382,10975,85876,49080,07578,68876,87380,86184,44486,56088,069

82,48688,76682,30682,54676,48979,16483,42488,483

103,14694,50591,082

101,642

DUE FROM BANKS AND BANKERS.

Apr. 30.May 21. .June 25..July 30..Aug. 27..Sept. 24.Oct. 29..Nov. 26.Dec. 31..

1920.

Jan. 28..Feb. 25..Mch. 25.Apr. 27..May 25..June 29..July 27..Aug. 31.Sept. 28.Oct. 26..Nov. 30.Dec. 28..

1921.

Jan. 25.Feb. 21..Mch. 29..Apr. 26..May 31..June 28..July 26..Aug. 30..Sept. 27.Oct. 25..Nov. 29.Dec. 27..

1922.

656,697673,279649,576649,108637,200676,343629,169619,178599,480

504,407508,615466,454479,514515,097501,191460,815456,971474,408489,088488,126492,646

475,880489,930465,839506,990492,729500,738503,082510,455512,518553,309526,688£52,253

53,08549,93449,90748,43945,36744,08644,26243,01945,546

35,70634,25333,42934,39733,17136,21132,162

34,05335,10737,21237,367

34,92835,87233,11244,70039,97538,05437,62833,74237,21340,64242,14038,463

145,299128,031113,237118,742113,608128,703101,718111, 839119,549

95,431102,54690,04694,887

149,968136,39188,32485,43595,74992,36487,25999,254

80,32277,69870,73668,91374,72974,43375,92772,72172,865

57,38756,44253,53852,56448,69354,10050,90253,82153,53051,74258,54753,674

79,58475,74380,84077,17372,82778,04469,93572,40973,58381,83584,32082,181

50,12549,26154,55457,30856,71255,18056,66851,78451,84057,55356,02951,991

22,13230,64528,60530,36733,11927,33627,52226,77920,514

19,88920,89119,54919,46621,13318,99214,86115,84614,21213,15915,21312,647

13,64613,38712,63214,28921,82016,11217,88819,05617,72316,77318,85620,059

9,5199,065

10,0807,795

12,5908,4839,6048,1856,402

8,5808,6257,9447,2436,4347,3537,8917,0916,591

151,686152,824159,739154,912154,282161,094156,212152,944158,404

5,9715,4365,1195,0974,8524,4374,2354,4525,315

6,0084,496 '

4,622 15,3364,2585,8265,5346,995 ,7,243

12,135 :11,560 j13,410 113,50612,504|

7,9756,3005,8728,1777,7949,1496,2925,8335,7337,0786,9366,845

135,423134,108123,535135,448134,935139,826145,957138,878132,399159,114139,586161.357

32,187 !32,602 !32,685 i32,95928,586 I42,670 I30,93028,142 I28,681 !

5,6936,3805,0926,0065,2224,5935,3344,9485,8786,5506,6936,583

123,609130,998121,892128,684119,355120,130125,267124,456121,948131,175126,567127,124

29,33826,54423,82622,54322,00220,32622,35320,45022,59225,43024,83124,831

23,92427,23922,06829,69422,31629,65725,03029,34229,01829,28926,97631,227

1>,25224,69625,46623,30320,28126,80724,70224,75819,263

17,00119,14017,60917,85617,05112,41816,34217,21017,58519,81219,10718,876

19,59815,97223,09118,97220,23720,67123,97924,13018,42218,13820,59621,731

41,247 ,64,082 !61,94065,516 I

59,30154,138 i54,18250,013

44,76443,43534,28039,33037,88040,46245,47442,53942,88843,10138,47440,430

41,57348,35341,61412,01747,15143,32241,00946,73045,36441,19942,30150,743

21,31118,27716,96112,15013,13718,47618,94917,30016,165

15,16913,59612,56911,74111,63610,33811,1469,94115,13014,90613,84316,723

16,46219,05517,74717,71516,56613,52315 54417,35228,90526,74724,07721,920

74,07776,80072,27678,76976,22277,60177,31472,21855,187

54,44948,95649,50546,94341,13442,79344,41514,18215,52819,90651,37250,611

18,02059,30446,51655,67116,86219,90555,90959,06160,72858,53151,36553,232



SELECTED ITEMS FOR REPORTING MEMBER BANKS INNEW YORK CITY AND FOR FEDERAL RESERVE BANK OFNEW YORK.


Date.

Apr.

May

June

Jnly

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

1920.29

1623307

1421284

11182529

1623306

1320 . . . .27

3101724

18

1522295

121926

310172431

1921.7. . . .

142128

4H18254

111825

1. . .8

1522274

111825 . . . .

18 . . .

152229

6132027 . . .3

10

Eeporting member banks inNew York City.

Due tobanks

andbankers.

Reserveswith

Federalreservebank.

,080,714,081,207,067,370,005,762,053,044,046,309,000,568, 023,521994,301

,019,8179R1,139

, 024,896985,966

,063,789,059,541,030,137991,219959,670963,238935,121944,474919,903944,489 |937,697975,151942,412977,130S78,154

,062,385941.85590i; 815894,921888,668884,182907,386870,371851,011909,194890,661997,538

1,011,969976,413946,400882,028864,880841,833863,577865,181844,349828,254848,254794,501863,454831,866845,521809,800787,476827,342828,152806,232801,506812,728806,346865,229773,858809,388841,134797,229812,739799,079797,470792,648

Accom-modationat Federal

reservebank.

641,906625,952646,899646,849649,523611,510649,367626,834657,189649,228661,989617,682642,952674,113632,818646,808610,846606,317615,224624,805600,719616,977618,559618,737625,876614,380581,542628,922640, 552567,804603,782579,841612,731589,453561,804591,941586,096581,400596,035604,725

588,376571,559581,935570,313568,529553,875557,877558,493547,547575,254539,173539,619563,146533,576558,668540,503547,220551,734546,508530,124553,973561,141580,922680,880568,126564,745548,567547,292537,517545,612517,848508,748

Federal ReserveBank of NewYork.

Federalreservenote cir-culation.

619,202629,871635,312650,800663,390656,163681,559606,544•609,590658,874661,273550,195611,843688,664705,421686,086684,087683,814722,485780,893766,878814,059865,675826,578 !672,077 i749,027751,308846,203848,291 ]856,103881,607890,467 I881,614 ;806,099 i803,266 |864,779 !822,912752,917810,665765,922

787,551 i718,681 !793,998 i825,610 •861,005 |833,196 I791,485799,558758,348789,067650,796605,390532,997559,661551,885542,419507, S40513,944 I547,447394,034 I405,338423,106 I393,141 '293,557286,900283,174326,709311,974312,670284,545298,657273,423 i

847,782835,554835,738832,704838,600845,006843,927849,246854,827861,807851,002854,828859,232882,506871,467850,323846,836849,589852,369852,695854,295854,925865,548864,439861,597855,701866,091864, 895875,737875,027876,706886,709872,609869,621876,321873,360863,560871,522880,870864,516

839,625800,121793,026787,746796,492787,938791,991796,383801,916791,404789,920780,740783,461776,791762,173756,071741,460739,004725,430718,909707,350715,951696,928688,966675,424671,523684,615654,260645,313643,875647,346638,045

Totalcash

reserves.

664,929641,820654,894687,785638,998655,749649,167568,733674,138647,988658,601652,841620,103651,002631,781639,365615,634621,089615,291599,206610,115598,724603,743610,289581,819672,134625,025605,466607,460584,818606,610£98,823597,201610,857619,585585,888598,036582,523612,940610,242

587,659582,099546,098544,939550,352565,519591,146577,273600,483610,121661,898739,917833,441770,251767,474768,740785,035785,453759,112780,250800,544844,287896,091910,321933,682953,552904,977904,600915,224947,507894,501884,396

SELECTED ITEMS FOR REPORTING MEMBER BANKS INNEW YORK CITY AND FOR FEDERAL RESERVE BANK OFNEW YORK—Continued.


Reporting member banks inNew York City.

Due tobanks

i andbankers.

Reserves Aecom-with j modation

Federal [at Federalreserve | reservebank, i bank.

1921.Aug. 17 778,228

24 760,47931 824,208

Sept. 7 j 772,91814 781,26721 764,17828 1 809,547

Oct.

Nov.

5.11-12.1926

2.

Dec.

837,236853,18386(S,566829,639893,219

9 1 863,161870.656823', 183888,388826,884824,015816,042

16.23.30.7.14.21.28 j 815,242

Jan.

Feb.

Mar.

Apr. 5

1922.41118251815211815222951219

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

3..10..17..24..31..7..

14..21..2X.5..

12..19..26..2..

16..23..30..6 .

13..20..27..

4.11..18..25..

1.8..

15..22..29..

6.13..20..27.

907,533895,326870,334870,278951,524853,697915,959848,374940,073901,885949,979882,962880,000917,246914,642934,562 :926,106 i943,892 i952,761969,419 !954,894 i

1,019,593977,678 !988,1389f>8,532941.083

1,009,635 ;1,007,270 j968,665963,192984,590928,903923,977906,103907,832923,026942,521925,877897,117979,441 ,971,037 !

1,013,792 ;932,547 i944,665 I922,068 I940,996 !892,991 i958,540 |873,669876,468919,718910,261

507,588520,918535,010543,811518,668514,189568,276527,537554,104557, 771575,139561,912543,306549,390557,870571,701540,031538.737602,797582,432

612,586604,611552,507553,129562,281585,364586,994550,989570,817577.673653,827534,737582,345576,591594,942598,512595,347599,605629,355632,722644,820614,394637,268621,477613,541699, »23616,194657,029647,397623,059635,344581,622569,571592,911602,532589,367578,337544,822580,573592,955655,436666,748577,386612,757575,375594,596605,177569,973594,145563,936588,054639,948

Federal ReserveBank of NewYork.

Federalreservenote cir-culation.

255,546246,552241,710256,550206,000130,327150,424181,005216,165155,436155,876 j119,131157,500103,215 j130,949124,992148,035133,375157,560131,279

124,78296,84183,971 !61,851 !59.208 |96,078 I83,51743,472 !33,413 i14,28112,265 !20,246 j22,529 !42.209 i22,691 '20,6098,058

28,5529,3888,245

23,1365,7837,8589,2247,294

52,57977,39147,35871,5419,728

16,11313,20719,56327,81821,08227,99519,60625,96423,781 133,705 !

122,222 !74,983 ]57,150

126,209 ,143,197 !147,300 j112,689 |81,234 !

157,615 !125,183 i86,132

115,915

637,645634,018632,320647,337639,847635,042631,130642,293638,752632,329«23,873630,748643.400634,716637,672631,590641,716646,659666,571663,329

663,073626,329611,792605,082614,031615,027621,792626,544626,673628,280626,501625,844625,774633,156625,426621,684615,475623,900619,314«17,404614,887'625,246620,15361fi, 159617,810618,7»5642,355622,754616,469616,779623,044621,278613,644609,556606,993615,358604,842605,186604,481610,763611,984605,330595,140598,764604,301588,415580,198594,003593,520591,809605,539599,001

Totalcash

reserves.

912,359951,756881,741962,487972,388

1,078,5681,089,7981,042,0501,014,7531,089,2171.089,2451,101,0731,066,3821,097,2871,094,5661,112,8681,075,4101,064,5451,104,1901,114,114

1,119,0451,172,4581,155,8021.180,8671,138,0601,106,1221,101,2621,144,6911,122,4451,125,5771,090,5511,116,9501,151,1471,145,5751,157,2661,164,2881,163,2041,136,4881,156,5551,189,7751,187,9961,172,5421,196,2961,165,3251.184,5361,203,8331,118,3801,139,5901,134,7301,173,2331,189,1591,167,4241.145,8681,165,0301,163,8121,121,7281,104,8271,091,3421,094,9301,065,2631,055,2061,104,2761,083,7991,082,3091,055,6191,059,4931,093,5921,097,5731,036,0081,034,0031,046,1961,055,982


JANUARY, 1923. FEDERAL RESERVE BTJLUETIN. 29

THE FIRST THREE YEARS OF GERMANREPARATION.

PART III.—MODIFICATIONS OF THE TREATY.

THE SPA AGREEMENT.

This article will be concerned in the mainwith the negotiations subsequent to the sec-ond Conference of London, which concludedwith the acceptance of the Reparation Com-mission's decision by Germany on May 11,1921; for, with the qualification noted in thepreceding articles, no true modifications of thetreaty of Versailles could take place until theReparation Commission had announced its deci-sion. Prior to this date, however, one importantconcession had been made to Germany in thematter of coal deliveries. This was at the SpaConference, in July, 1920.

It will be recalled that, under the treaty,Germany's liability in coal was, for 1920-21:To France, say, 25,000,000 tons; to Belgium,8,000,000 tons; to Italy, 6,000,000 tons. De-spite periodic reductions by £the ReparationCommission of the deliveries] required fromGermany, the actual deliveries had invariablyfallen short of the demands. In fact, at thetime of the conference, Germany was deliveringat only one-half of the required rate. Yet, atthe same time, it appeared that without theconsent of the commission, contracts were beingmade with dealers in Switzerland and Hollandinvolving the delivery of 35,000 and 80,000tons per month, respectively. The Germandelegates at first professed their inability todeliver more than 1,100,000 tons per month,while the Allies offered as a temporary conces-sion the delivery of 2,000,000 tons per monthfor the next six months. Later Germany pro-

gosed to deliver 1,400,000 tons per month fromictober 1, 1920, and 1,700,000 from October 1,

1921, on condition that the food situation hadimproved by that time. The food problem wasalways to the fore in this connection, for it wasclearly perceived that German productioncould never increase to the necessary dimen-sions without an increase in the food suppliesfor the miners. It was reported by the LondonTimes on July 16 that Mr. Lloyd George andHerr Stinnes had made a bargain that, if theGermans on their side would raise their offerto 2,000,000 tons, the Allies would increase theprice at which the deliveries were estimated.Accordingly the Germans made a proposal todeliver 2,000,000 tons on several conditions.First, that the Allies would pay to Germany,

in cash, the difference between the German pit-head price * and the world market price of coal;second, that the Allies' intention of establishinga commission to supervise coal movements beabandoned; third, that a mixed Allied andGerman commission be set up at Essen to studythe condition of the mines; fourth, that theAllies provide a fund for feeding German minersand improving the housing conditions.

Ultimately terms for the next six months 2

were imposed, the main features of whichwere as follows:

(1) Germany to deliver 2,000,000 tons permonth.

(2) A premium of 5 gold marks per ton to bepaid by the party receiving the coal in additionto the price as fixed in the treaty, to be ex-pended in providing foodstuffs for Germanminers.

(3) A joint commission to be set up atEssen to seek means of improving the con-ditions of the miners, with a view to greaterefficiency.

(4) The Allies to make advances to Germanyto the extent of the difference between theprice mentioned in (2) above and theGerman or British export price f. o. b. port(whichever be lower), such advances to enjoyan absolute priority ovjer all other claims ofthe Allies against Germany. These advanceswere to be in the form of credit, not of cash.

(5) If the first three months' deliveries fellshort, the Allies would proceed to occupy theRuhr Valley or some other hitherto unoccupiedarea.

(6) A permanent delegation of the Repara-tion Commission was set up in Berlin, to passupon the production and distribution planssubmitted by the German authorities in pro-viding for the deliveries to the Allies.

In January, 1921, the Spa agreement lapsed,and with it the credits allowed to Germany,the payments of 5 gold marks per ton, and thereduced demands for deliveries. Hence therewas an automatic reversion to the terms ofthe treaty which have not since been revisedin any permanently important respect. Thefixing of the demands since that time seems tohave been based partly upon German capacityto deliver and partly upon world market con-ditions, and the arrangements made were in allcases merely temporary. A return to the pre-

• The German price was artificially kept down by Government regula-tion. On the authority of Mr. Keynes, the difference between theGerman pithead price and the British export price was about 70 shillingsper ton (100 shillings loss 30 shillings) at this time.

»The period of the agreement is important, for at its conclusion theterms thereof lapsed, and the treaty conditions came into force again.


30 FEDERAL EESEBVE BULLETIN. JANUARY, 1923.

war avenues of trade was marked by a Franco-German agreement, in August, 1921, thatFrance would deliver 3,500,000 tons of Saarcoal annually to Germany. The Wiesbaden 3

agreement provided that, if France did not re-quire all the coal she was entitled to under thetreaty, Germany might export the unrequitedamount and pay France on the German deliv-ery basis. Then in January, 1922, the coaldemands were fixed at 5,750,000 tons per quar-ter, which is somewhat lower than the Spa de-mand and very materially below the treatydemands. There were in addition variousprice adjustments made, such as that of August,1921, when the finance ministers decided thatFrance should be charged for sea-borne coaldeliveries up to August 31 at the German inter-nal price, instead of the British export price,a distinct concession to France in view of thelow price of German coal, kept down by gov-ernmental regulation.

THE WIESBADEN AGREEMENT.

The events which, after the ReparationCommission's decision, gave rise to the mostlively discussion during 1921 were the con-versations between M. Loucheur and HerrRathenau, at that time the French and Germanministers of reconstruction, and the agreementconcluded at Wiesbaden which was the out-come thereof. The agreement signed onOctober 6 is very complicated in its docu-mentation, but may be understood merely asa convention simplifying reparation paymentsby providing for the direct supply of resto-ration materials to France. It will be recalledthat the treaty provided * for the liquidationof a part of Germany's obligations by deliveriesof such materials, for which it was later agreed,the recipient country was to pay over to thecommission the fair value thereof in currencyor bond coupons within a month of theirreceipt. The Wiesbaden agreement, in effect,replaced the pertinent parts of the treaty, sofar as they related to France, by an arrange-ment for larger deliveries with partially deferredcredit given therefor in Germany's reparationaccount. Up to May 1, 1926, Germany wasto deliver a maximum of goods, includingdeliveries under unimpaired annexes of thetreaty,5 valued at 7 billions of gold marks. Thedeliveries were to be facilitated by a Germanand a French company, under Governmentcontrol, but financed in part by private capital.

'See below.* Annex IV; see November, 1922, BULLETIN, p . 1293.• Annexes III, V, VI; see November, 1922, BULLETIN, p . 1294.

The former would assemble the materialordered by private individuals through thelatter, and undertake its transmission tosuitable terminals, whence the French companywould deliver it to the individuals whoseorders it was executing. The French companywould dispose of the material solely for re-building the devastated regions, and would fixthe prices at such a figure as would not competeunreasonably with the French private interests,which had been strongly opposed to the agree-ment. Germany's interests were protected bythe provision that the deliveries were to be"compatible with the possibilities of pro-duction in Germany, and subject to thelimitations as to supplies of raw materials"and "in accord with the requirements neces-sary for Germany to maintain her social andeconomic life." The prices with which Ger-many was to be credited were to be fixed bymutual consent, or, failing agreement, by acommission of three, comprising one Germanand one French nominee, with a mutuallyacceptable third member, or, failing that, anominee of the Swiss President. A price listwas to be fixed every three months, the pricesto correspond with French internal prices, lesscustoms and transportation charges. In ad-dition, provision was made for the executionof orders given by individuals, not through thecompany, but to a private German producer.

The deferred-payment scheme contained ablanket provision that in no case should Ger-many be credited with more than 1 billion goldmarks in any one year. Secondly, Germanywould only be given immediate credit for amaximum of 45 per cent of the values of theyear's deliveries if these were less than 1billion gold marks, or 35 per cent if they weremore. The former limitation applied to treatyand agreement provisions together, the latterto agreement provisions only. So that ineffect they meant that a minimum of 55 or 65per cent, as the case might be, would be carriedforward, to be credited by installments. Thisbalance was to carry interest at 5 per cent perannum, and would be wiped out in 10 equalyearly installments, from May 1, 1926—that is,from the end of the opening period of theagreement. But it was expresslv providedthat in no case should France be debited in anyone year with a total of agreement and treatydeliveries in excess of her agreed proportion ofreparation payments (52 per cent). Provisionwas made for the renewal of the agreementbeyond the four and a half years of its presentlife.


JANUABY, 1923. FEDERAL RESERVE BULLETIN. 31

In addition to the general part of the agree-ment, there were added four supplementaryagreements. One of these, dealing with coal,has already been outlined above. Anotherprovided for the closing of the animals accountby the delivery of 62,000 horses, 25,000 cows,25,000 sheep, 20,000 hives of bees;6 another forthe liquidation of Germany's liabilities in re-spect of restitution of industrial materials by-delivery of 120,000 tons of machinery as ordered,with a payment of 158,000,000 of marks ingold;7 and the fourth for the delivery of 6,000railroad cars to satisfy France's rolling stockclaims.6

This agreement could not, of course, be putinto effect until the consent of the other Allieshad been obtained. Hence it was forwardedto the Reparation Commission for its considera-tion. The commission, in its decision of Octo-ber 20, entirely approved the principles under-lying the agreement, but saw in it certaindepartures from the terms of the treaty, inthat it violated in particular the provision fordivision of the reparation receipts among theAllies as agreed " on a basis of general equityand the rights of each," and that giving thecommission power to fix the value of goodsdelivered by Germany.8 Having no power toauthorize these departures then, the commis-sion referred the memorandum to the Govern-ments represented on it, with a recommenda-tion that it should receive a favorable exam-ination.

On October 26 the British member of thecommission, Sir John Bradbury, submitted tohis Government a report on the proposedagreement, in which he showed that Germanywas by the agreement taking upon herselfheavier burdens than had been laid on her bythe London decision. In view of the fact,then, that that decision, made so recently,"represented, in the opinion of the * * *commission * * * the maximum burden* * * Germany could be expected to beable to bear," the agreement was liable toprejudice the fulfillment of Germany's otherobligations. In case of default on these latter,it was then probable that Germany wouldplead her agreement obligations in extenuation.This would involve, in fact, an alteration in thedivision of receipts, expecially favorable toFrance. According to Sir John Bradbury's re-port, the Allies would, in effect, be advancingsums to France at 5 per cent, on the security,

• Article 238. and Annex IV; see November, 1922, BULLETIN, p . 1292,col. 1, and p . 1293.

' Annex IV; see November, 1922, BULLETIN, p . 1293.• Annex n ; see November, 1922, BULLETIN, p . 1291, col. 2.

not of the French Government, but of theFrench share of future reparation receipts.

Sir John Bradbury, then, supported by theBelgian and Italian delegates on the commis-sion, recommended certain^safeguardsjagainstthe possible ill effects of the agreement. First,there should be a definite period, of notj morethan seven years after the conclusion of thedeliveries, beyond which no new deferment ofdebit should be made. Second, that the aggre-gate deferred debit against France should belimited to, say, 4 billions of gold marks. Third,France should be required to pay to the generalreparation account, from time to time, anyamount of the deferred debits, which might benecessary to secure to the other Allies theiragreed shares of the reparation receipts.

For some time no action was taken in thismatter, but in March, 1921, the allied financeministers, at their meeting at Paris, consideredthe agreement in detail. It is interesting tonote how far the safeguards suggested by SirJohn Bradbury were applied. In the firstplace, the agreement was approved for a periodof three years, the amount remaining due atthe end of 1924 and interest thereon to becanceled in 10 equal annuities, beginning May1, 1926, by debits to France's reparation ac-count. Further, the amounts deferred werenot to exceed 350 millions of gold marks in1922, and 750 millions in 1923 and 1924 each,so that the total deferred on May 1, 1926,could not be more than, say, 2,100 millions ofgold marks. The revised draft of the agree-ment was finally approved by the commissionin June, 1922, after provisions had been insertedfor facilitating private deals, in particular theplacing of orders directly with the Germanmanufacturer. In the following month thecommission notified the German Governmentthat the agreement would come into operationon July 20.

Si<The application of the Wiesbaden agreementwas, then, the first arrangement which recog-nized the advisability of cutting down thedemands for cash, and of making arrangementsfor larger deliveries of such goods as would notseriously injure the Allies' trade, and as wouldaccelerate the restoration of the devastated areasof France to their former productive capacity.

THE CANNES CONFERENCE.

The next step in the direction of the readjust-ment of the Allies' demands was made at theCannes Conference. The holding of the con-ference was decided upon by the French andBritish premiers in conversations at Boulogne


32 FEDERAL KESEBVE BULLETIN. JANUARY, 1923.

in December, 1921. No details of the policyto be pursued were published, but M. Briandannounced that "the two countries weredetermined to act together." "We have al-ready laid down broad lines," he said, "andwill only have to complete the details atCannes." Just prior to this, however, theFrench Foreign Office had issued a statementembodying the principles which should gov-ern the conversations. The first expressedFrance's willingness to abandon the Londonschedule of payments in favor of a new one,which would not, however, reduce Germany'spayments; the next to reduce the armies ofoccupation (which were now seen to absorb thelarger part of the receipts) provided GreatBritain were to give absolute guarantees ofsupport in the event of future German aggres-sion. The third stated that France wouldassist in the improvement of the economicsituation (by reducing tariffs, for example),recognizing that Great Britain was as con-cerned over trade prospects as was Franceover reparation. Again recognizing this fact,France was ready to undertake joint measureswith Great Britain looking to the economicand industrial restoration of Germany. Lastly,and perhaps most important, France, whileunwilling to reduce the reparation claims, wasprepared to grant Germany every possiblefacility for making deliveries in satisfactionthereof.

Upon this basis, it may be assumed, then,the Supreme Council met at Cannes on January8, 1922, one of its objects being to arrange aschedule of payments for 1922. It was herethat it was decided to call a conference atGenoa, to which Germany and Russia were tobe invited to send delegates, and it was thisdecision which brought about the resignationof M. Briand, rendermg the conference to someextent abortive. On January 11 the FrenchSenate committee for foreign affairs tele-graphed to M. Briand what seemed to them tobe the four essentials of any agreement onreparation which might be made with GreatBritain. Such agreement must recognize thatthe economic and financial reconstruction ofFrance was essential to European recovery;that there must be no reduction of the repara-tion demands of May, 1921, and no modifica-tion of Belgian priority; it must give definiteassurance that French rights would be re-spected at Genoa, and must guarantee Frenchsecurity. Despite M. Briand's consequentresignation, however, and the Supreme Coun-cil's failure to take definite action on adjourn-

ment as to reparation, the meeting was notwholly unfruitful in this matter. The imme-diate fact was that the Reparation Commissiongranted Germany a provisional delay on thepayments due on January 15 and February 15,one of the conditions being the payment every10 days of 31,000,000 of gold marks.10 But be-yond this, general agreement had been reachedon the proposed program of 720,000,000 in cashand 1,750,000,000 in kind for the year 1922. Ofthe cash Great Britain was to receive 159,000,-000, of which she would lend 139,000,000 toFrance. The remainder would go toward theliquidation of Belgium's prior claims.

M. Poincare", who succeeded M. Briand, wouldagree to participate in the Genoa Conferenceonly on condition that there should be no dis-cussion there of reparation. Early in Feb-ruary he telegraphed to Mr. Lloyd George thatFrance felt unable to send delegates if any ofthe invited Governments let it oe understoodthat they did not entirely accept the conditionsarranged at Cannes, precluding the discussionof existing peace treaties. Hence the matterof reparation was now back in the hands of thecommission. Mr. Lloyd George did, as a matterof fact, call a meeting at Genoa of the signa-tories of the Versailles treaty to consider whatsteps should be taken should Germany defaulton May 31, but the invitation being flatly re-jected by the French, even this project did notsucceed in getting so much as private discussionof reparation at Genoa.9

On February 28, 1922, a provisional accordwas reached with Germany whereby paymentwould be made of 720 millions in cash and 1,450millions in kind. This represented a reductionof perhaps one-third from the London program.On March 21 the commission issued its decisionembodying details of this schedule. Germanyhaving already paid 282,000,000 in 10-day cashinstallments, there remained 438,000,000 to bepaid during the rest of the year. On April 15,18,000,000 was to be paid, 50,009,000 monthlyfrom May 15 to October 15, inclusive, and60,000,000 each on November 15 and Decem-ber 15. Of the goods payments, 950,000,000were to go to France and 500,000,000 to theother Allies, as far as orders might be placed.Merchandise delivered to the armies of occupa-tion was to be credited to their expenses ac-count, and not to reparation. Attached to thispartial moratorium were numerous conditions,11

• An aceount of the Genoa Conference was given in the FEDERALRESERVE BULLETIN for May, 1922, p. 549.

10 This arrangement will be dealt with more fully in the following arti-cle of the series on " Fulfilment of the Treaty."11 See final article of the series on "Fulfilment of the Treaty."


JANCARX, 1923. FEDERAL BESEEVB BULLETIN. 33

which gave rise to long correspondence be-tween Germany and the Allies. But thedecision was finally approved on May 31.

Even this program, however, did not lastlong. On July 11 it was decided to reduce theinstallment due on the 15th of that month to32,000,000, the balance of 18,000,000 beingcredited on account of recent deliveries of dye-stuffs under the terms of the treaty. This factis significant in view of the rigidity of the cashdemands formulated in the partial moratoriumdecision.

MORATORIUM NEGOTIATIONS AND THE THIRDLONDON CONFERENCE.

On July 12, 1922, Germany laid before thecommission a formal request for a moratoriumof two and one-half years and a resumptionof the loan negotiations which had recentlybroken down. For some days past HerrenFischer and Schroder had been conferring withthe commission on this matter, the outcomebeing the reduction of the July installment andthe application for a moratorium. The commis-sion, however, deferred consideration of thelarger question until the report of the guaran-tees committee, appointed under the commis-sion's May 1, 1921, protocol,12 should havebeen presented and examined.

Having thus expressed its inability to makefurther cash reparation payments, the GermanGovernment went further by asking, on July 19,that the monthly payments in respect of pre-war debts, by the clearing-house mechanism,be reduced from £2,000,000 13 to £500,000 upto December 31, 1922. Added to this was arequest that payments for damages to propertyrights and interests in Gemany of nationals ofthe Allies be suspended. This request wasrefused by the allied compensation office onJuly 25.

On the following day the guarantees com-mittee announced that Germany had agreed tocertain measures of financial controlu overreceipts and expenses, the floating debt, andthe export of capital. The significant fact re-garding this agreement is that in his formalacceptance Chancellor Wirth consented to thecontrol for the period of the expected morato-rium, to be determined at the pending LondonConference.

The failure to reduce the compensation de-mands, and the reduction, on July 21, of the

u See December, 1922, BULLETIN, p. 1425.u This sum was agreed upon with all the Allies on June 10,1921.M This will be more fully discussed in the final article of the series on

"Fulfilment of the Treaty."

coal deliveries for August, September, andOctober to 1,725,000 tons per month, gavemixed indications for the coming conference.But a far more important fact was the issuanceon August 1 of the Balfour note,15 which wasimmediately taken as a full expos6 of Britain'sattitude on the reparation problem. This doc-ument was the first official recognition of the in-separability of interallied debts and reparation.

The note was addressed to the French Gov-ernment, but identical notes, varying only inname of the addressee, were sent to Italy,Jugoslavia, Rumania, Portugal, and Greece.A copy was presented to the American em-bassy for transmission to Washington.

The British Government began by expressingits recognition of its obligations with respectto its debt to the United States, but announcedthat while doing so it was forced to modify thecourse which, in other circumstances, it mighthave wished to pursue. "They can not treatthe repayment of the Anglo-American loan,"said the note, " as if it were an isolated incidentin which only the United States and GreatBritain had any concern." The principles wereenunciated that " their (the Allies') debts wereincurred, their loans were made, not for theseparate advantage of particular States, but forthe great purpose common to them all," andthat the United States' loans to Great Britainwere largely in effect loans to the Allies onGreat Britain's security.

Accordingly, Great Britain did not intend toask more from her debtors than was necessaryto pay her creditors. At the same time, shecould hardly be content with less. She couldnot be expected to forego all, and at the sametime pay all, since her people were sufferingfrom an unparalleled burden of taxation, wantof employment, and diminution in the nationalwealth. The amount demanded of France wastherefore to depend more on the demands tobe made on Great Britain by the United Statesthan on the French debts to the United King-dom.

The policy favored by the Government wasto surrender Britain's share of reparation andcancel all interallied debts, but there was nodesire to profit by a less satisfactory settlement.Of the alternatives, it was believed a generalsettlement would be of much greater value thanthe "most successful enforcement ofj|legalobligations." 0

Following a great deal of unofficial discussionand criticism and supplementary statements by

15 The full text of Lord Balfour's note was reprinted in the Septem-ber, 1922, issue of the BULLET"*,


34 FEDERAL RESERVE BULLETIN. JANDABY, 1923.

members of the British Cabinet of Great Brit-ain's determined intention to pay her debt tothe United States, the allied premiers assem-bled at London on August 7. At the outsetPremier Poincare' announced France's refusalto agree to a moratorium without further guar-antees from Germany. The specific proposals,which included the establishment of a customsbarrier on the eastern boundary of the occupiedarea, the seizure of State-owned forests andmines on the left of the Rhine, and the pay-ment of the 26 per cent export l ew direct tothe Reparation Commission instead of to theallied treasuries, were referred to a committeeof experts, which, after careful examination,rejected them as unproductive, by a 4 to 1majority. The proposal that Germany shouldhand over a share in industrial enterprises wasalso unfavorably reported.

The British proposals included a moratoriumon cash payments until the end of 1922, meas-ures to prevent the export of capital, to estab-lish the autonomy of the Reichsbank, to con-solidate the floating debt, and to exercise con-trol over German finances. A more permanentproposal was to reduce the total cash reparationdemands to not more than 26 per cent of ex-ports in future years, while leaving furtherscope for payments in kind.

At this juncture of deadlock Signor Schanzer,obviously influenced by the Balfour note, pro-posed the placing of the question of an imme-diate moratorium in the hands of the Repara-tion Commission, a permanent settlement notto be made until the various- countries hadcompleted their debt funding negotiations withthe United States.

This compromise failed to produce agree-ment, however, and the conference adjourned,on August 14,. without any definite stepstoward settlement having been taken.

The August 15 payment having been post-poned, pending a decision at London, it wasnot until August 31 that the Reparation Com-mission decided to relieve Germany from fur-ther cash payments in 1922. The British dele-gate's proposal to grant this relief withoutguarantees was rejected. Germany was tofurnish suitable guarantees for the payment of6 months' treasury bills, which were to be deliv-ered to the Belgian Government, to whom theimmediate payments were due, in lieu of cashpayments. Such guarantees were to be agreedupon between the German and Belgian Govern-ments, and, failing agreement, gold was to bedeposited as a guarantee. The decision onGermany's application for a 2\ years' mora-

torium was to be deferred until financial re-forms, involving budget equilibrium and cur-rency rehabilitation, were carried out.

Germany at first failed to give the BelgianGovernment satisfactory guarantees. The de-posit of 100,000,000 gold marks was accordinglydemanded and refused. A declaration of vol-untary default was threatened by the Repara-tion Commission, but finallv, on September 18,the Reichsbank announced its willingness toguarantee the treasury bills. This offer, whichwas put forward after private business nego-tiations between the Reichsbank and the Bankof England, was accepted by Belgium the fol-lowing day. The French delegate on the Repa-ration Commission, however, refused to joinin ratifying the arrangement, it being heldthat the guarantees were insufficient, and thatthe burden transferred by the 6 months' billsto 1923 would mean a burden on Germanywhich might be used as an excuse for askingrelief from 1923 payments.

THE INTERNAL SITUATION IN GERMANY.

For some time past the financial position inGermany had been cause for anxiety to theAllies. It was now critical. The reparationcommittee, doubtless influenced by the failureof the experts to arrange a loan, in June,18 andthe report of the guarantees committee, tookaccount, in the decision just outlined, of thefact that " the German State has lost its creditand the mark has depreciated continuously."This question of currency depreciation, withall its ramifications, now became uppermost.

With the problem of stabilization m mind,Sir John Bradbury, the British representativeon the Reparation Commission, put forward aproposal, made public on October 14, underwhich, for a period of two years, or possiblylonger, Germany was to furnish 5-year treasurybonds in place of cash payments. The com-mission was to be reorganized, with the inclu-sion of a United States representative, andremoved to Berlin, in order to be in closertouch with the German Government. Therelief granted to Germany would enable theAllies to fix an exchange value for the mark,by means of an arrangement under which theReichsbank would sell gold for paper marks ata rate to be determined by a mixed commission.I t was recognized, of course, that such a schemewould be impracticable unless the Reichsbankwere relieved from making new discounts forGovernment expenditures.

•• See final article on "Fulfilment of the treaty,"


JANDAET, 1923. FEDERAL RESERVE BUIJOETIN. 35

This scheme the French delegate was in-structed by his Cabinet to oppose. The Frenchplan called for complete and rigid control offinances and the power to veto expenditure andregulate taxation. The Reparation Commis-sion's powers were to be limited to the applica-tion of guarantees and reforms in Germany.The Reichsbank would be under interalliedcontrol and forbidden to discount furthertreasury bills, while the treasury would nothave power to raise loans without the consentof the guarantees committee. The calling ofan international meeting was urged, to formu-late a comprehensive settlement of interallieddebts and reparation and to fix the paymentsfor 1923 and 1924.

With these plans held over, Germany wasgranted some relief by a decision of the alliedclearing offices freeing her from further pay-ments under this procedure (for the settlementof pre-war debts) until July, 1923.

So critical had the position now become thatat the end of October the Reparation Commis-sion itself went to Berlin to investigate finan-cial conditions for itself and to consult theGerman Government on measures of stabiliza-tion of the mark and its incidents. The com-mission's investigations continued well intoNovember.

At the same time a committee of privateexperts, called together by the German Gov-ernment, was also examining the situation. OnNovember 8 the majority report17 of the com-mittee, signed by R. H. Brand, G. Cassel,J. W. Jenks, and J. M. Keynes, was presented.Upon the hypothesis that stabilization of themark was equally as essential to Germany'screditors as to Germany itself, it expressed theview that, granted certain concessions by thecreditors, stabilization was possible. But suchan end "must primarily depend upon Ger-many's own efforts and own resources and onresolute action by her own Government."Two obstacles were in the way therefore—thebudgets of the Versailles treaty and the finan-cial methods of the German Government dur-ing and after the war. Regarding the former,a moratorium until such time as paymentscould be made "from a real surplus and notfrom the proceeds of fresh inflation" was a sinequa non. The requisite period would be atleast two years and the moratorium mustcover kind deliveries as well as cash payments.Furthermore, while stabilization must bebegun immediately, in view of the risks ofinaction, any scheme could only be provisional

" The full text is reprinted on p. 45 of this issue.

until "final settlement on the reparation ques-tion at an early date on lines capable of beingcarried out." To overcome the second obsta-cle, the report advocated the setting up of anindependent board of exchange control withinthe Reichsbank, with an adequate gold supplyfrom the Reichsbank's reserves. So long asany of this gold was unpledged, the board wasto purchase paper marks at a fixed rate. Adefinite maximum was to be fixed for the float-ing debt, and Government requirements, whichwould otherwise be met by increasing thefloating debt, were to be supplied by fundedloans No modification of these rules was tobe made without the consent of the Repara-tion Commission.

The minority report,18 signed by L. Dubois,B. Kamenka, and G. Vissermg, likewise recom-mended the suspension of cash payments untilstability was reached. To attain the end,however, it suggested the creation of a newstandard of value in the shape of a gold mark,to be issued by a "specie bank," founded uponthe Reichsbank's gold raserves. It further ad-vocated the extension to Germany of an inter-national bank credit of 500,000,000 gold marks.

A memorandum, signed by the banker mem-bers of the committee, R. H. Brand, L. Dubois,and G. Vissering, recommended the formationof an international banking syndicate with acapital of 500 millions of gold marks in theform of credit acceptances guaranteed by theReichsbank, 500,000,000 further Reichsbankparticipation in supporting action. Germanywould require a moratorium until repaymentof the syndicate's advances.

The outcome of these independent inquirieswas that on November 13 Germany made a pro-posal to the Reparation Commission based uponthe Brand-Dubois-Vissering plan, a copy ofwhich was appended to the communication.It expressed the willingness of the Reichsbankto advance 500,000,000 gold marks to theGovernment toward a stabilization loan, Pro~vided an equal amount were forthcoming fromabroad, and subject to the conditions laicl downby the experts. As necessary concessions toGermany there was to be a moratorium cover-ing cash payments for three or four years. Themoratorium would also cover deliveries in kind,except such as were required for the rehabilita-tion of the devastated areas. Even these, how-ever, were to be continued only so long as theyinvolved no increase in the floating debt.

There were now before the powers, then, vari-ous schemes for the amelioration of the critical

8 The fall text is reprinted on p, 47 of this issue.


36 FEDERAL BESEKVE BULLETIN. JANUARY, 1923.

situation in Germany and the generally un-healthy economic conditions throughoutEurope. Whether of British, French, German,or joint origin, all these plans had this commonend in view. Suggestions had become prolificwhen the time came for fixing the schedule ofpayments for 1923, but little material improve-ment had been gained from the measuresalready employed. Such was the result ofmore than three years of consideration of theproblem of making good the material losses ofthe war.

THE UNITED STATES AND REPARATION.

No treatment of the general topic of repara-tion would be complete without a statement ofthe steps taken by the United States Govern-ment in dealing with the matter of its ownclaims against Germany and of its connectionwith the European negotiations.

On March 2, 1921, the Secretary of Stateplaced before Congress a provisional total of theAmerican war losses. The aggregate claims,consisting in large part of losses through sub-marine warfare, were estimated at $180,000,000.At the same time, an estimate of Americaninterests in Germany, consisting of securities,bank deposits, real estate, debts, etc., placedthe total at $ 191,000,000. The Versailles treatybeing rejected, the United States of course sentin no claims to the Reparation Commission, asdid the other Allies. Unofficial observers repre-sented the United States on the various com-missions until February, 1921, when Mr. W. H.Boyden was withdrawn from the ReparationCommission, where he had held a seat as un-official representative of the United States.

At this point the United States enters on anew period with regard to the question ofEuropean reparation, her support being soughtboth by Germany and the Allies. In February,1921, the French Government sent a note toM. Jusserand, its Ambassador in Washington,instructing him to "present the allied indem-nity proposals in a more favorable light," witha view to obtaining American help in the matterof reparation. Then in March a long informalmemorandum was sent to the United StatesGovernment by Doctor Simons, asserting Ger-many's urgent desire to reach an accord with theAllies, recognizing Germany's liability to makereparation, and refuting the charge of reluc-tance in so doing. The note pointed out thatGermany's offers of labor and material had beenignored,19 but expressed her intention of makinga new proposal to France along those lines.

'• First conference of London. See December, 1922, BULLETIN, p . 1424.

It asserted that an international loan was theonly solution to the problem of reparation pay-ments, and announced Germany's willingness toassume part of the debts of the Allies. To thismemorandum, while ignoring the questions ofloans and assumption of debts, the Secretary ofState replied (March 29) that "this Govern-ment stands with the Allies in holding Germanyresponsible for the war, and therefore morallybound to make reparation so far as may bepossible." The next step was taken on April24, when, after the first ultimatum of London,Germany made the proposition, outlined in thepreceding article of this series,30 submitting itto the United States for consideration lookingto its transmission to the Allies. This trans-mission the United States, as related, refused toundertake, finding in the proposal "no accept-able basis of discussion."

Following these negotiations, early in May,1921, an invitation was sent by the Allies to theUnited States Government to appoint repre-sentatives on the Supreme Council, the Repara-tion Commission, and the Council of Am-bassadors. The invitation was at once ac-cepted, Mr. Harvey, the Ambassador inLondon, being appointed United States repre-sentative on the Supreme Council, Mr. Herrick,Ambassador in Paris, on the Council of Am-bassadors, and Mr. W. H. Boyden reappointedas representative in an unofficial capacity, onthe Reparation Commission.

The United States did not, however, set upany machinery for the purpose of securingreparation. The treaty of Berlin, signed inAugust, 1921, has been outlined in the adden-dum to Article I. I t will be recalled that theUnited States retained the "rights, privileges,indemnities, reparations or advantages towhich it * * * has become entitled underthe terms of the armistice signed November 11,1918, * * * or which under the treaty ofVersailles have been stipulated for its * * *benefit." Article II names the specific partsof the treaty under which the United Statesreserves its rights. These include Part VIII, inwhich are enumerated the damages for whichGermany is to pay, among them being pensionsand allowances. The status of the UnitedStates on the Reparation Commission is dealtwith in section (4), which reads: "While theUnited States is privileged to participate inthe Reparation Commission, * * * theUnited States is not bound to participate inany such commission unless it shall elect todo so."

2° See December, 1922, BULLETIN, p . 1425.


JANUARY, 192S. FEDERAL RESEBVE BULLETIN. 37

In March, 1922, almost immediately afterthe invitation to attend the Genoa Conferencehad been declined by the Secretary of State, ademand was sent to the meeting of AlliedFinance Ministers for reimbursement for ex-penses incurred in connection with the army ofoccupation. The total expenditure of theUnited States Government up to April 30, 1921,had been $275,324,192, of which the balancedue from Germany was $240,744,512. Thissum was therefore claimed from the Allies outof the amounts so far received from Germany,which (according to the treaty of Versailles)were to be allocated first to the defraying ofexpenses of the armies of occupation. TheFinance Ministers took no action on thismatter, it being considered outside the scopeof their powers. In a note to the United StatesGovernment they suggested that the mattershould be referred to the respective Govern-ments through ordinary diplomatic channels,and that in the agreement between the minis-ters arrived at on March 11, which dealt inpart with the division of the first billion marksreceived from Germany, a clause had beeninserted to protect American interests. Thisclause provided that all agreements on the

Suestion of division of receipts were subject tole American rights, as the various Govern-

ments might establish them.In accordance with the suggestion of the

Finance Ministers, then, the Secretary of Stateaddressed a note to each of the Governments ofGreat Britain, France, Italy, Belgium, andJapan. This note stated that the total cost ofall the armies of occupation up to May 1, 1921,had been 3,639,282,000 gold marks. Theamounts due to Belgium, France, and Italyhaving been paid in full, there remained out-standing a balance of 1,660,090,000 gold marks,of which 966,374,000 was due to the UnitedStates and 693,716,000 to the British Empire.The former was the amount now claimed, inas-much as it was understood that between May 1and December 31, 1921, 130,696,000 marks hadbeen appropriated to Great Britain, such appro-priations being "expressly made and receivedsubject to the rights of the United States."

In their replies the Allies all recognized theAmerican claim in principle and informed theSecretary of State that negotiations were pro-ceeding among them in order to agree on acommon plan. The British reply, for example,stated that "the claim put forward by theUnited States Government that these expensesshould be .reimbursed to them is one whichHis Majesty's Government would not in anycircumstances desire to question.'' The French

Government made no objection to the claim,but raised the question to whom the claimshould properly be made—to Germany or tothe Allies.

Regarding reparation for her own damagesand losses, the first step taken by the UnitedStates a'fter the conclusion of the Berlin Treaty21

was in the negotiations which culminated in theagreement between the German and UnitedStates Governments, signed at Berlin onAugust 10, 1922. This provided for the set-ting up of a mixed claims commission, to passupon and fix the amount of American claimsagainst Germany. The commission was toconsist of one representative from each partyto the agreement, together with a mutuallyacceptable umpire, whose decision was final inthe event of disagreement between the com-missioners. It was to pass upon claims ofAmerican citizens in respect of all damage toor seizure of property, rights, and interests, aswell as damage to persons, arising out of thewar and sustained since July 31, 1914; andupon debts owing by the German Governmentor German nationals to United States citizens.

The agreement came into force immediatelyupon its being signed. Germany appointedDoctor Kiesselbach, and the United StatesMr. E. B. Parker, as the respective com-missioners, while, at the special request of theGerman Government, another American, Su-preme Court Justice Day, was appointed asumpire. In accordance with the terms of theagreement, the commission met in October,and its deliberations are proceeding.

FINANCE COMPANIES.22

Since about 1900 there has been developedin the United States a group of organizationsvariously known as finance companies, creditcompanies, or discount companies. Their busi-ness may include one or more of the following:(1) Discounting or buying commercial receiv-ables—i. e., accounts, notes, or acceptances;(2) advancing funds to dealers with which topurchase automobiles (wholesale sale of auto-mobiles) ; (3) advancing funds to enable dealersto sell automobiles on the installment plan(retail sale of automobiles); (4) advancing

2i See November, 1922, BULLETIN, p. 1296.n This article presents the result of a study made by the Divisionof Analysis and Research of the operations of finance companies. Thatpart on discounting receivables is based upon data secured from 20companies, that on wholesale financing of automobiles on 23 companies,and that on retail financing of automobiles on 60 companies. Acknowl-edgment is due these organizations for kindly furnishing the information,and to those leading authorities in the field who have read and madesuggestions on the tentative draft of this report.


38 FEDERAL RESERVE BULLETIN. JANOARY, 1823.

funds to enable dealers to sell furniture, agri-cultural implements, books, musical instru-ments, refrigerators, restaurant fixtures, house-hold utensils, electrical appliances, etc., on theinstallment plan; (5) advancing funds againstmerchandise. Specialization is noticeable, es-pecially in connection with discounting receiv-ables and financing automobiles. Scarcely anycompanies undertake all the above classes.The larger firms in the field usually limit them-selves to discounting receivables and financingautomobiles. It is only with these two classesof business that the present study deals, inas-much as they comprise the great proportionof the total volume of business done. Forclarity in the following study, "finance com-pany will be used where the general groupof companies is referred to; "discount com-pany," in speaking of practices in connectionwith discounting receivables; and " auto-financecompany," in referring to automobile financing.

A recent study (Merrick, The Modern CreditCo.) states there are to-day over 125 financecompanies in existence with an aggregatecapitalization of approximately $100,000,000and a volume ot business amounting to$1,200,000,000 annually. An official of oneof the largest companies gives a smaller figurein each case—$65,000,000 capitalization and$800,000,000 as the volume of business.Another authority places the volume ofreceivables discounted in the eastern Statesalone at roughly half a billion dollars a year.The size of the individual company variesgreatly, from a capital of a few thousandto several million. The average size of thecompany specializing in discounting receiva-bles, however, is larger than that financingautomobiles, as automobile business as a ruleis much easier to obtain and new companiescan acquire a reasonable volume in a snortertime. Further, as one writer explains, "sellersof accounts receivable are, generally speaking,larger concerns than the average automobiledealer and will hesitate to place their busi-ness with a small or new company." Of the125 companies mentioned above, 45 are incor-porated under the laws of Delaware. In NewYork a number have incorporated under thebanking laws of that State and are subject toregular examination by the State BankingDepartment. Both preferred and commonstock are usually issued.

DISCOUNTING RECEIVABLES.

The range of industries from which receiva-bles are acceptable is large, but most companies

exclude certain lines. One company, forinstance, states: "We do not like automobiletires or accessories, musical instruments, orluxuries. We find the furniture accountsunsatisfactory." In another company, "dia-monds, furs, jewelry, and concerns sellingsmall invoices to very small trade, like whole-sale confectioners, cigars, etc., are practicallyexcluded." The same idea is expressed inmore general terms by still another company,which excludes "lines highly specialized; lineslacking intrinsic value; lines not readilyre-salable; lines whose value depends on con-tinuity of customers in business." Accountsof municipalities or political subdivisions arenot acceptable in some instances, while inothers no objection is made. One discountcompany will not purchase accounts from aconcern which sells a large portion of itsproduct to a few firms. Some companiesexclude from purchase any receivables ofconcerns not given first or second class creditrating by either Dun or Bradstreet; othersaccept a very limited number of customersof the lower ratings. The average net worthof companies selling their accounts is probablynot above $100,000 if based upon the totalvolume of receivables purchased. The numberof companies with a net worth of less than$100,000 is in the majority. From one-fourthto one-half of the total number of customersof discount companies have used up lines ofcredit at banks and sell receivables to sup-plement these lines. In no case is there ageneral rule that the "seller" maintain anopen line of credit with banks, althoughfrequently the discount company advisesit. The clientele of the larger discount com-panies is "fairly constant, although a ten-dency toward outgrowth of the service bycustomers is reported by some companies.

The receivables.—Accounts comprise a largeproportion of receivables discounted or sold,notes and acceptances aggregating in no caseover one-third the total volume. Of the em-bodied credit, notes comprise the largeramount. Preference for notes or acceptancesas contrasted with accounts is about equallydivided among the companies, with no notice-able tendency toward one or the other ineither the larger or smaller companies. In thepurchase of receivables one of two plans maybe employed: (1) The debtor may be advised(perhaps on the original invoice) that hisaccount has been sold or assigned and that hewill make payment to the discount company,or (2) no notice of the transfer may be given tothe debtor. The plans are known as the


JANOABY, 1923. FEDERAL, RESERVE BULLETIN. 39

"notification" and "nonnotification," respec-tively. The latter is used in the majority ofinstances, but since the discount companyunder this plan must depend upon the integrityof the "seller" in forwarding remittances re-ceivables will at times be taken under the noti-fication plan when they would not be acceptableunder the nonnotification.

Procedure in discounting receivables.—Whena concern arranges to sell or discount its receiv-ables, a contract is signed which provides, amongother things, (1) the charges made and times ofpayment by the assignor; (2) that, under thenonnotification plan, the assignor permit thecompany's auditors to call at their pleasure toinspect his books and other records; (3) thatthe assignor transmit on the day of receipt alloriginal checks, drafts, notes, etc., received inpayment or on account of any receivables soldto the company; (4) that the assignor give thecompany power of attorney to transact anybusiness relating to the assigned receivables,including indorsement of checks, drafts, notes,and other documents with the assignor's name.In addition the assignor gives an actual assign-ment of his interests and title in the receiv-ables, listing each invoice. Attached to thefinancial statement which the assignor is alsorequired to fill out is an application for afidelity bond, which the discount companymay take out in any company it desires orcarry itself.

It is customary to advance, at time of pur-chase, about 75 to 80 per cent of the face valueof the receivables. The remainder is paid asthe accounts are liquidated. One firm statesthat at times it will advance as high as 85 percent, while one small company advances onlytwo-thirds of the receivables' face value. Thetheory underlying a partial instead of a com-plete advance has been stated as follows:23

Early in the history of our business experience we con-cluded that it would not be safe to advance the full faceof an invoice, because of the infirmities attached to anopen account. At that time manufacturers and wholesaledealers were making approximately 20 per cent on theirturnover. As a matter of business, we felt that we couldnot afford to put more money into an account than ourclients had invested. Hence an 80 per cent first payment,and the balance, less discount and deductions taken bythe customer, became the fixed standard.

To determine the maximum amount of re-ceivables which will be purchased from any oneseller four methods are m use: j

(1) Extend a line of credit and advise theseller thereof.

(2) Set a maximum figure which the sellerdoes not necessarily know.

23 A. K. Jones, quoted by Merrick, p . 24.

(3) Have no set maximum but consider eachgroup of receivables separately.

(4) Agree to take care of all shipments solong as the discount company does not believethe seller is unduly expanding.

Some companies employ all methods, butthe most frequent is to consider each offeringseparately. Receivables offered are subject tothe same credit investigation in all cases. Thesize of the discount company is the governingfactor of the maximum which can be extended,and accordingly the amount varies a great deal.The minimum is also subject to wide variationamong the various companies, one of the largerfirms stating "an outstanding balance of lessthan $10,000 is not desirable. The averagedesirable balance more or less continuouslyoutstanding, except in a seasonal business, isfrom $50,000 to $100,000."

Averagematurity of the receivables purchasedis from 45 to 60 days. In most cases themaximum maturity is 90 days, although insome instances 6 months is allowed. I t isthe more common practice for the discountcompany to hold until maturity all notes andacceptances purchased and then collect themitself. In some instances, nevertheless, theseller is allowed to make the collection andthe notes or acceptances are released to himunder a trust receipt a few days previous totheir maturity. In all cases the seller remainscontingently liable until the finance companyis reimbursed.

Credit work.—The basis upon which receiv-ables are purchased is most frequently thecollateral, i.e., the receivables sold or assigned,rather than the credit standing of the "seller."One of the largest firms in the field arrangesthe credit factors in the order of their im-portance as follows:

(1) Lines of business.(2) Class of customers.(3) Terms of sale; 30-day invoices less

hazardous than 4 months.(4) Our own experience with the accounts

and "seller."(5) Financial statement of the "seller."(6) Report of our special credit investigators

and monthly auditors.(7) Responsibility of personal guarantors.A second large company places the para-

mount importance upon the financial state-ment of the buyer. In all cases the financialstatement must show a reasonably good finan-cial position on the part of the "seller."

If receivables have been purchased under thenonnotification plan, it is customary for thediscount company every 30 or 45 days to check



the outstanding accounts on the "seller's"books to detect any discrepancies in theamount remaining due as compared with thatshown on the discount company's books.This work is done by the discount company'sown auditors, who also prepare a monthly listof unpaid invoices, which the seller signs.The auditors may verify by correspondencewith the debtor a part of the receivables out-standing. This practice of auditing or check-ing is followed by all companies reporting forthis study except a few very small ones whichdo not maintain credit departments. If pur-chases are made under the notification plan,this checking is not necessary, inasmuch asremittances are made directly to the discountcompany.

General experience of the companies is thatfrom 10 to 20 per cent of the receivables runpast due. One medium-sized company, whichgives the figure of those not paid at maturityat from 15 to 20 per cent of the total, statesthat only 3 or 4 per cent run 30 days past due.In the case of a Baltimore and a Chicago com-pany, the receivables over 60 days past due onJune 30, 1922, amounted to only 0.0135 percent and 0.0127 per cent, respectively. It isthe general practice of discount companies tocarry the receivables for a certain period afterthey are due, usually 30 or 60 days, and then ifstill unpaid to require the "seller" to repur-chase them, either by refunding the advanceor by substituting new invoices. Loss to thecompany occurs only in those instances wherethe seller" will not repurchase the receivablesand where fraud exists. Fraud, according toone of the leading authorities, is the greatestrisk in the business, and results in the losses tohis company varying according to the_ moralrisk involved instead of by lines of business.In relation to the volume of purchases the totalloss is remarkably low, especially in the largerdiscount companies. One company over aperiod of about 10 years has had an averageannual loss of 0.0012 per cent, and anotherover a period of five years, less than one-tenthof 1 per cent. Seldom does the loss go overone-half of 1 per cent.

Charges of the discount company.—The usualcharge made by discount companies is one-twenty-fifth of 1 per cent a day on the netface amount of receivables, plus a charge of$5 per $1,000 on the first $100,000 of receivableswithin any 12 successive months. Some ex-ceptions to this are found, as in the case ofone company, which charges one-thirtieth of 1per cent a day, while another makes a flat

charge of 1$ per cent a month. Since only 75to 80 per cent of the face value of the receiv-ables is advanced, the actual rate charged iscorrespondingly increased. Some companiesin addition make a premium charge for afidelity bond. This is very small, in one caseamounting to between one one-thousandth andone eight-hundredth of 1 per cent on thegross amount of the receivables. The ratequoted includes all charges for both interest andservices. In the words of one company theservices include:

We retain a very competent attorney for an annualretainer. His office services are at the disposal of ourcustomers free of charge. We also maintain a very effi-cient credit department and a corps of efficient auditorsand accountants who audit the books of our customers atleast once a month and instruct the bookkeepers in theproper method of keeping accounts.

Financing the discount company.—Nearly alldiscount companies supplement their capitalto a considerable extent by borrowing. De-pository banks are the source most commonlyused. Some of the larger companies, however,have established their credit in the open marketand borrow a large proportion through it. In-dividuals who advance funds as an invest-ment furnish a very limited supply. It iscustomary to have some of the depositorybanks at points elsewhere than the head office,as this gives a wider spread of credit and, insome instances, offers collection advantages.An average balance of 20 per cent is main-tained against loans. A "clean-up" with eachbank is made once or twice a year for 30 to 90days, but funds for the liquidation are usuallyborrowed from another source rather thanthrough a reduction of indebtedness. I t isthe practice of some companies to pledge alltheir receivables with the trustee instead ofmaintaining a current portfolio.

The most common form of obligation used inborrowing, both with banks and in the openmarket, is the collateral trust note. Collateralconsists of receivables deposited with a trustee,generally a trust company. The usual marginrequired is 20 per cent, but most companiesreport they always keep far in excess of thisamount. Maturity is usually 6 months, al-though it may vary from 30 days to 12 months.Notes are issued in series, with denominationsof $500 and multiples thereof. The rate ofinterest varies from 4£ to 8£ per cent, accordingto the money market.

The annual volume of business of reportingcompanies ranges from 5 to 20 times theircapital investment. A turnover of 8 to 12times is most frequent. The total amount of


JANUABX, 1923. FEDERAL RESERVE BULLETIN. 4i

borrowing at any one time as compared withthe discount company's own capital varies.One authority states:

We consider well-managed credit companies witha minimum cash stockholders' investment of about$2,000,000 can safely borrow four to five times their stock-holders' investment, excluding investments in othercompanies. Companies with less than 1500,000 cashstockholders' investment, we think, should not borrowover from one to two times such investment.

Contrary to this view is the opinion of anotherofficial who believes that "the risk in the busi-ness is in adverse ratio to the amount of capitalinvested up to $300,000, or say $400,000 or$500,000, because a smaller concern can notafford to maintain a complete organization,and, above $500,000 invested capital, the riskincreases in the same ratio that the volumeincreases, by reason of the greater difficultyof supervision."

Many bankers and credit men have beenstrongly opposed to the business of discountcompanies. At the same time, the companiessell almost all their collateral trust notes tobanks, and the volume so sold is several timestheir own capital investment. Thus the dis-count company stands between the bank andthe "seller" of receivables, and, in fact, guar-antees these advances to the banking system.In other words, it serves as a special agency forproviding the supervision necessary in suchadvances, and also assumes a direct obligationto the banking system in connection with them.

FINANCING AUTOMOBILES.

Operations of finance companies in con-nection with financing the purchase and saleof automobiles fall into two categories: (1)Advances to assist the dealer in securing carsfrom the manufacturer, and (2) accommoda-tion enabling the dealer to sell on the install-ment plan without the necessity of keeping hisown capital tied up and so limit his operations.The two plans are known, respectively, as whole-sale financing and retail financing. A com-pany may limit its activities to retail financing,or else may operate in both the wholesale andretail fields. Among the companies reportingfor this study no examples of limiting accomo-dation to wholesale purchases are found. Somecompanies have close connections with auto-mobile manufacturers, and have agreementsto finance their specific make of car. Othercompanies specialize in financing particularmakes of cars, or they may limit their opera-tions to the more popular-priced cars. Themajority make no limitation either as to makeor price.

Statistics of the volume of automobilefinancing done are not available. Estimatesreceived from authorities in the field as to thepercentage of cars sold on installments varyfrom 50 to 70 per cent of the total number ofcars sold. Sales for the past few years havebeen in excess of 1,500,000 cars annually. In1920, 1921, and 1922 the wholesale value of theautomobiles produced was $2,233,000,000,$1,260,000,000, and $1,558,567,000, respective-ly. The corresponding number of cars pro-duced in these years was 2,205,197, 1,668,550,and 2,527,000.

Wholesale advances.—Larger auto-f inancecompanies have a definite percentage, usually80 to 90 per cent of the wholesale price, whichwill be advanced on every car. Smaller com-panies, which are less highly organized, deter-mine" their advances more upon a considera-tion of each case separately. Variation in thepercentage advanced is augmented as themakes of cars handled increase in number. Acertain percentage may be advanced on carsstored in a public warehouse, and another forthose kept on the dealer's floor. If a distinc-tion is made, the former is always the larger.The advance on trucks is usually at least 10 percent lower than on passenger cars, because of aheavier depreciation and slower market. Theindividual range of the advance is from 60 percent up to, in one instance, 95 per cent. Mostcommon, judging from the replies received, is65 to 70 per cent, or roughly, two-thirds thevalue of the car. The "value" may includevarious items. In the case of some companiesit is merely the list price; in others, the listprice plus freight, war tax, and extras.

Maturities vary from one company to anotherand even within the same company; 30, 60, 90,and 120 days are all common, with 60 and 90days the prevailing periods for the largest num-ber of companies. The length of the advancedepends to a considerable extent upon theseason of the year in which the financing isdone. Advances made in the winter are for alonger period than those made at a later date.

The majority of loans are made against thedealer's promissory note or acceptance, securedby a chattel mortgage or warehouse receipt.In contrast, however, the autofinance com-pany may secure legal title to the car by pur-chasing it and giving the dealer a repurchaseoption. If a car is sold by the dealer beforematurity of the paper, the related paymentsbecome due immediately. Several companiespledge the notes received from dealers with atrustee as security against collateral trust notesused for borrowing money, and hi such in-


42 FEDERAL RESERVE BtTLLETIN. TANDABT, 1923.

stances payments are made by the dealerdirectly to the trustee.

Retail advances.—In retail financing the'per-centage which will be advanced is based uponthe retail price as contrasted with the whole-sale price in the case of wholesale financing.Because of this the amount actually advancedmay be as great in one case as the other,although the percentage quoted as a maximumis much smaller in retail financing. The follow-ing tabulation gives the usual percentageadvanced under each plan by the 20 reportingcompanies undertaking both types of business:

Wholesale.9085-9080-90 50-66}80.80 . . . .80 . . . .80. . . .75-80.75-80.75. . . .

Retail. Wholesale.60 7570 70-80

66*7566$66}66}6566}60

66}66|66?

65-95.62. . . .60-75.

Retail.66}

66

66|66}

54.866}

Payment of the advance is most commonlyspread over a period of 6, 8, 10, or 12 months.Installments may fall due monthly or every 3or 4 months. The former is the most common.The charge of the finance company is custom-arily added to the selling price of the car andpercentages are based upon this total, knownas the "time-price."

Wholesale security.—Automobiles may bestored either upon the dealer's floor or in awarehouse. In general, the practice followedwill be determined by the dictates of thefinance company with which the dealer main-tains relations. Companies exercise this super-vision because of the difference in the poten-tial risk involved under the two plans. Ifstored in a warehouse, title to the car rests in areceipt either made out in the name of thefinance company or else indorsed over to it,whereas if stored on the dealer's floor thefinance company must rely more upon theintegrity of the borrower. It is customaryto find both plans in operation in the samecompany as well as a great variation betweencompanies in the percentage stored under eachplan. The size of the dealer and the seasonof the year are both important elements indetermining the place of storage if the financecompany does not exercise a definite policy.

Some of the largest finance companiessecure from the manufacturer of the car aguarantee of payment of the dealer's obliga-tion or an agreement to repurchase the cars bypaying the amount advanced plus all charges

and expenses incurred. The majority of thesmaller finance companies never secure aguarantee from? a manufacturer, but relyentirely upon the value of the physical collat-eral and the credit risk of the dealer.

Retail security.—-In retail financing advancesare made on security in actual use and subjectto various contingencies. Fire, theft, andcollision are all potential risks. Auto-financecompanies ordinarily require the car to be in-sured against fire and theft. Practice varieswith regard to collision insurance. Protectionagainst constant depreciation is secured by themargin between the value of the car and theamount advanced being increased as install-ment payments are made.

Guarantee of payment of the purchaser'sobligation by the dealer is more common thana similar guarantee of dealer's obligations bymanufacturers in wholesale financing. Theguarantee usually takes the form of an indorse-ment of the promissory note of the purchaser.With some of the cheaper makes of cars aguarantee is not required.

Wholesale legal documents.—The type oflegal document used is determined largely bythe place of storage of the car and the laws ofthe State in which the dealer operates. Ifcars are stored in a public warehouse a ware-house receipt is used. A separate receipt isissued for each, car. In contrast, if the car isstored in other than a public warehouse eithera chattel mortgage, a trust receipt, a condi-tional bill of sale, or a lease agreement is used,depending upon which may be the preferredform in the State in which the auto-fioancecompany is operating. Chattel mortgagesare the most common.

Most important of the clauses in the docu-ment peculiar to automobile financing is onewhereby the dealer agrees not to use the car.This provision does not allow the car to beused even for demonstration purposes unless aspecial permit is secured from the auto-financecompany. If the car is used without securinga waiver of this clause, the act is termed"conversion" and is sufficient reason for theauto-finance company to take possession.

Retail legal documents.—In retail financingeither a conditional bill of sale, lease agree-ment, or chattel mortgage is used, dependingupon the same factors as just noted underwholesale financing. If cars are sold undereither a conditional bill of sale or a lease agree-ment, title remains with the buyer. Betweenthe two there is a technical legal difference.Under the former there is a sale conditioned bycertain specifications, while if the transaction


JANOABT, 1923. FEDERAL RESERVE BULLETIN. 43

is evidenced by a lease agreement the lawrecognizes a contract on the part of the userto rent, rather than to buy, the car. Con-trasted to both these forms of documents isthe chattel mortgage under which title doespass from the seller to the purchaser imme-diately, and the seller only maintains a lien assecurity.

The stipulations and agreements of all threeforms are very similar. Each company hasits own particular forms, however, and con-sequently there is some variation in minorpoints. The following excerpts from a leaseagreement are representative of the way themore cqmmon points are handled:

The lessee agrees that any equipment, attachments,accessories, or repairs placed upon said motor vehicle shallbe and become a correspondent part thereof, and theterm motor vehicle whenever used in this agreement shallinclude said equipment, attachments, accessories, and re-pairs as though they were in all cases specifically enumer-ated.

The lessee further agrees to indemnify and save harm-less the lessor from any and all loss, or claim for loss ordamage to persons or property caused by said motorvehicle, or by the use and operation thereof, and to giveimmediate written notice to said lessor of any and all lossor damage to or loss of possession of said motor vehicleoccasioned by any cause whatsoever.

Said lessee further agrees not to use or permit said motorvehicle to be used for taxicab purposes. Lessee alsoagrees that he will not in any case dispose of said motorvehicle without the written consent of the lessor indorsedhereon. Said lessee further agrees to use said motorvehicle in a careful and prudent manner, to house andshelter the same, and to make any and all repairs thereonnecessary to keep said motor vehicle in first-class condi-tion; and if, in the judgment of the lessor, said motorvehicle is not kept in first-class condition lessor may makesuch repairs as are necessary and add the cost thereof toamount due lessor hereunder. Lessee agrees to keep saidmotor vehicle free and clear of any and all liens andencumbrances of any nature whatsoever, including allState, Federal, and local taxes, or charges which may belevied or assessed thereon.

And the lessee hereby agrees that he will use, operate,and control said motor vehicle in strict conformance withall statutes, laws, regulations, and ordinances relating tothe use, operation, and control of motor vehicles, andexpressly consents that upon failure of lessee by himself,agent, servant, or employee so to do lessor may at hiselection repossess said motor vehicle and enforce all hisrights, privileges, and remedies under this lease, providedlessor is also the holder of the above-mentioned note.

The loss, injury, or destruction of said motor vehicleshall not operate in any manner to release said lessee frompayment as provided herein on the note given. Re-newals or extensions of the time of payment of the amountsdue hereunder or on said note shall not release lessee fromthe conditions of this agreement.

It is expressly agreed that no assignment by the lesseeof his rights or interest in this contract shall be validwithout the written consent of the lessor.

Following the above stipulations is the usualagreement regarding procedure and rights incase the terms of the agreement are not com-plied with, payment not made at maturity, etc.

It is customary in both wholesale and retailfinancing to give a personal obligation in addi-tion to the document bearing title to the car.Promissory notes are generally used, althoughsome instances of acceptances are found. Aseparate note may be given for each install-ment, but more commonly there is only onenote for the entire amount, with a schedule ofpayments embodied withjn the note.

Wholesale credit work.—There are two distinctcredit elements in wholesale financing—first,the value of the collateral, and, second, thefinancial standing of the dealer. Considerablediversity of opinion exists as to the one deserv-ing the most weight from a credit viewpoint.One authority states "most large companiesconsider the car itself rather than the dealer."In contrast to this view is the practice of oneof the largest companies, which comments asfollows:

The dealer's signed financial statement is the basis uponwhich we determine the extent to which we are willingto finance him. We check up the information submittedby the dealer by means of the various commercial reportingagencies, local banks, the trade, and attorneys. After allthis information has been accumulated, it is thoroughlyanalyzed and items on the statement which appear to beexcessive are scaled down. The limit to which we willextend the dealer assistance is determined by the relationbetween the new scaled quick assets and the current lia-bilities and the hazard involved. From this you will seethe element of the physical collateral is largely a matterof secondary consideration.

The type of business of the auto-finance com-pany, the makes of cars it finances, and its rela-tion to automobile manufactures all have abearing on credit extension. If the companyis operating very closely to the manufacturer,the value of the car is relatively less important.The same condition will exist if the auto-finance company has a guarantee or repurchaseagreement from the manufacturer. In addi-tion, the salability of the car, as determinedby its popularity and price, is very important.

The percentage of advances in wholesale ad-vancing which run past due is comparativelysmall. In some instances it is stated there areno delinquencies, but other companies estimateit as high as 5 or 10 per cent of the total accom-modations.

Retail credit work.—In retail financing thecredit risk of the retail purchaser enters for con-sideration in addition to the value of the col-lateral and the financial standing of the dealer.Investigation of the dealer is made through theusual credit channels. I t is upon a favorableconclusion from this investigation that accom-modation is extended. Auto-finance compa-nies will not consciously finance the purchase ofa car which ultimately will prove too heavy a


44 FEDERAL RESERVE BTTIiETlN. JANOARY, 1923.

burden to the purchaser and so necessarily berepossessed by the dealer. Some companies tofacilitate their credifcwork furnish their clientswith a complete setjpf forms for handling atransaction, including in this set a financialstatement blank to be filled out by the pur-chaser and then forwarded to the finance com-pany to be passed upon.

The auto-finance company is ordinarily lo-cated in other than the immediate locality ofthe purchaser and so is confronted with diffi-culties in securing certain information as to thepurchaser's moral character that is highly im-portant in retail automobile sales. For thisphase of the investigation the dealer is in amuch more favorable position. The companyavails itself of this by quite commonly requiringthe dealer to indorse his customer's paper. Thedealer, therefore, will do a certain amount ofcredit analysis before requesting the companyto finance the transaction.

The importance placed upon the make of carvaries with different companies. Some con-sider it as a relatively unimportant elementinasmuch as in a sale to the ultimate user thereis not the same contingent element of risk of notbeing able to dispose of the car that there is inwholesale financing. Other companies lookupon the make as of prime importance becauseof the possibility of loss in case of repossession.

The percentage of past due accounts rangesfrom a fraction of 1 per cent up to 15 to 20 percent. The percentage of total cars financedwhich it is necessary to repossess is very low,in most cases being not more than 1 per cent.

Charges of finance companies.—The chargeof auto-finance companies as a general ruleapproximates 15 per cent on the funds out-standing. One of the leading authoritiesstates that if a company is to make a profit itmust charge in excess of 12 per cent. Chargesare made for the total advance for the entiretime of any part of the loan. Accordingly,while some companies quote a rate of as Towas 6 or 8 per cent, the actual charge is corre-spondingly increased. One company statesthat at times its charges amount to 36 per cent.

There is very little uniformity among thecompanies in the method of quoting rates.Some companies, as, for example, thosefinancing only particular makes, have the samerate for all cars they will finance, irrespectiveof the make or price. Other companies havedifferent rates for different prices or differentmakes. Fords and Dodges are frequently thesubject of particular rates. Further, the com-pany may quote its rate in one of several ways.There may be a discount rate quoted either on

an annual or monthly basis, or there may bea discount rate plus a flat charge, which inturn may or may not vary according to theamount advanced. The rate may includeinsurance, or this may be charged for in addi-tion. Instead of quoting its charges by a rateas the above, a company may have a fixed sumvarying according to the make or price of thecar. The charge varies according to whetherthescar is new or has previously been used;according to whether the payments are mademonthly or at less frequent intervals, andaccording to the initial payment. From one-third to one-half is the customary initial pay-ment required.

Capital of auto-finance companies.—Of thethree sources available for securing workingcapital, i. e., banks, open market, and privateinvestors, banks are used by auto-financecompanies in the large majority of cases.Borrowings frequently amount to some threeor four tunes the company's capital. In afew of the reporting companies no outside fundsare employed. The business of auto-financecompanies, resulting as it does in promissorynotes, lends itself readily to furnishing collat-eral against loans. Collateral trust notessecured by the notes of purchasers of cars arewidely used. These are issued in denomi-nations of $500 and multiples thereof. Thecustomary margin is 20 per cent. Banks arethe largest purchasers, discounting them di-rectly from the auto-finance company, ratherthan buying them from a commercial-paperdealer. Two of thelargest reporting companies,nevertheless, dispose of a large portion of theirpaper through brokers. One of these reportsthat it "has been quite successful in develop-ing a steadily increasing outside market."

Small auto-finance companies frequentlyrely upon their lines of credit with their localbanking institutions. In such cases theselines are not supplemented by other sources, orby borrowing upon collateral trust notes. Thecompany's obligation to the lender may beeither a secured or unsecured promissory note.A balance of 20 per cent of the accommodationis generally required. The companies "clean-up at least once a year and remain out ofdebt to the lending institution for two or threemonths. Seasonal aspects of the business arethe main determinants of the maturity of theloans. Some companies borrow on demand,others use a 6-months' time note; 30, 60, and90 days are the most common maturities.Maturities of collateral trust notes range from30 days to 6 months, with the longer periodsmore frequent.


JANUAEY, 1923. FEDERAL, RESERVE BULJÊTIN. 45

ECONOMIC POSITION OF FINANCE COMPANIES.

In their fundamental characteristics financecompanies date back both to the earlier moneylenders in the large centers and to the "factors"which for 50 years or more have operatedlargely in the textile industry. The formerwere chiefly individuals who advanced fundsand took whatever security seemed most satis-factory. Factors often combine finance andmerchandising by making sales for the millswhich use their services and by advancingfunds to the latter for manufacturing opera-tions. These advances are made largelyagainst the manufacturer's bills receivable,which are assigned to the factors. The moneylender and the factor still remain, but thebusiness of finance companies has been placedupon a more scientific basis and is now recog-nized as distinct and separate. Their businesshas tended more and more to resemble thepractices of commercial banks. The relationbetween the two closely resembles that betweencattle loan companies and banks.

There are in the United States a vast numberof companies and individuals whose resources,or apparent credit risk, do not measure up tothe standard required by banks. It is largelythese that the finance company is called uponto finance. It does not necessarily follow thatsuch subjects are not good credit risks, butmerely that in so far as the bank is able to investi-gate, they do not fulfill the usual requirements.In addition, payments of the loans made to thisclass may be spread over a longer period thanthat for which a commercial bank will advancefunds. The payments, too, are probably insmall lots, such as installments, which must becarefully watched and rigidly collected whendue. Collateral offered as security is in smalllots, such as a group of small accounts receiv-able. As a result, commercial banks find thisclass of business unprofitable at the usual ratesof interest. If they charged more, it wouldlead to legal difficulties in some cases, andnearly always to dissension among those bor-rowers who have to pay the higher rate.Finance companies, however, by dealing onlywith this class of customers can charge morewithout causing dissatisfaction among custom-ers. This increased income enables it tocarry the investigation further and to protectitself in making a loan, and also to watchdevelopments after the loan is made. Inshort, finance companies are an intensifiedpart of our commercial banking system.

The organization which has been developedby finance companies to assume such a placein our financial structure is not on the wholedifferent from that found in connection withthe loan function of commercial banks. Thecredit work is along identical lines and iscarried out through the same sources. Con-nected with one loan, however, there will bein most cases relatively much more creditwork, especially in connection with discount-ing receivables. No pyramiding of loans ispossible, inasmuch as the companies do notaccept deposits and so they actually reducetheir cash positions when extending loans.The collections of loans require additional de-tail work. Payments may be made on aninstallment basis, as in the case of automobilefinancing, or they may be made in small lotsat irregular intervals as the accounts fall due.Close supervision is essential in either case.Through the ability of finance companies suc-cessfully to carry out such closer supervisionthey are enabled to supplement our commer-cial banking system and to make for themselvesa distinct economic position in our financialorganization.

REPORTS OF FOREIGN EXPERTS ONMARK STABILIZATION.

The following is a translation of the full textof the two reports of the foreign experts pre-sented to the German Government. The ma-jority report is dated November 7, 1922, andis signed by R. H. Brand, Gustav Cassel, Jere-miah W. Jenks, and J. M. Keynes. The minor-ity report is dated November 8, 1922, and issigned by G. Vissering, Leopold Dubois, andBoris Kamenka.

THE MAJORITY REPORT.

(1) We are deeply impressed by the vital need of animmediate stabilization of the German mark. It is anessential condition of saving Germany from the threat ofcomplete collapse. It is equally essential in the interestsof her creditors, whose claims will otherwise becomevalueless. Granted certain concessions from these credi-tors which we indicate below, stabilization is possible.But it must primarily depend upon Germany's ownefforts and own resources and on the resolute action of herGovernment. It is hopeless at this stage to expect it to beaccomplished by foreign assistance as its main foundation.Germany must have a constructive policy of her own,even though it involves a risk. No other course is open.

(2) To the question whether stabilization is possible inpresent conditions we reply, "No." First, for internalreasons, in particular the results of the financial methodsadopted by the German Government during and after thewar; second, for external reasons, in particular the burdensof the treaty of Versailles.


46 FEDERAL, BESEKVE BULLETIN. JANCARY, 1923.

(3) With the necessary internal action we deal below.As regards external burdens, we are of the opinion that so

long as Germany is not relieved for a period from paymentsunder the treaty of Versailles, any attempt to stabilize themark would be futile and could only result in the uselessdissipation of Germany's ultimate reserves. Such reliefis therefore an indispensable prior condition.

The length of the period for which payments must besuspended will depend on the possibility of establishinga surplus in the German budget. The essential principleis that payments must not begin again until they can bemade out of a real surplus and not out of proceeds of afresh inflation. We believe that the period must now befixed at two years at least. The suspension of paymentsmust include deliveries in kind as well as cash payments.

(4) Any scheme of stabilization can only be regardedas provisional, pending a final settlement of the reparationquestion at an early date on lines capable of being carriedout. Nevertheless, in view of the risks of inaction evenfor a short further period, we think that stabilization mustbe begun in advance, if necessary, of a definitive settle-ment of this question.

(5) With the relief proposed above the success of anyscheme of stabilization must depend not on a foreign loan,but rather on industrial and budgetary developmentswithin Germany and on a final settlement of thereparation problem at an early date.

Nevertheless, the support of an international con-sortium would be of the greatest importance in its effecton public confidence. We think that while the plans ofstabilizing the mark are being put into working shape,negotiations should be initiated immediately to obtainsuch support, perhaps in the form of credits to be utilizedin case of need, and that a group of bankers should becalled together forthwith to consider the formation of aconsortium for the purpose of cooperating in the schemeof stabilization as proposed below.

We wish, however, to make it clear that in our opinion,pending a final settlement of the reparation question onsound lines, no credits can be obtained from a foreign con-sortium except on a very modest scale to supplement andsupport Germany's own efforts. No really substantial loancan possibly be obtained from foreign sources until thelenders have an assurance as to the position at the conclu-sion of the moratorium period, for without such an assur-ance no sound basis of credit exists.

(6) In the long run, the success of stabilization mustdepend on the equilibrium of the budget. On the otherhand, stabilization is in itself a necessary condition for therecovery of equilibrium.

We have been informed from the German treasury that,if the mark were stabilized and if the budget were relievedof the present extraordinary charges, it would be possibleto balance normal revenue and expenditures at any earlydate. Present conditions have thrown the statistics of thebudget into confusion, but we see no reason to doubt theaccuracy of this expression of opinion as to what is possible.

The utmost economy in Government expenditures andthe utmost rigor in the collection of taxes are of the firstimportance. Capital expenditure for the public servicesshould not be charged to revenue account but paid for outof internal funded loans. Nevertheless, it is neithernecessary nor practicable to prohibit absolutely an increasein the floating debt; and for a brief period it would be pos-sible, with a stabilized mark, to allow just enough furtherincrease to tide over immediate difficulties.

(7) We have found that the principal objection in theminds of many authorities to any scheme of stabilizationwithout a large measure of external support is based onpessimistic conclusions relating to the balance of trade.In present conditions a basis is lacking for any soundstatistical conclusions. We have been given many dif-ferent figures and we doubt if any of them deserve much

credence. In order to form any judgment at all on theamount of the adverse balance, which probably exists forthe moment, we are 'driven to another method of calcu-lation.*. On the debit side of the balance of payments Germanyhad to cover her adverse balance of trade, her paymentsunder the treaty, and the flight of capital from the country.To meet this she has had to rely on certain items of "invisi-ble exports,'' foreign credits, and purchases by foreigners ofmarks and mark assets. Somehow or other these differentsets of items must have balanced even during the currentyear. If the adverse balance of trade has been as large assome people suppose, the purchase of mark assets by for-eigners has to be put at an impossibly high figure.

We draw from this the conclusion that the actual tradebalance against Germany can not even now be very great,and that, if she is relieved of cash payments under thetreaty and of coal imports in replacement of reparationdeliveries, it should not be beyond her capacity to payher way.

We think, therefore, that the state of the trade balanceis not a fatal obstacle to stabilization. Moreover, a soundcurrency is in itself a strong corrective to an adversebalance of trade, and will bring into operation many forcestending toward equilibrium.

There is, however, one concession without which therestoration of Germany's trade equilibrium might imposeprivations so severe as to risk the breakdown of the prac-tical execution of our plan, namely, the restoration toGermany of normal prerogatives in international trade, asregards her liberty to impose import duties on luxuries anda right to claim most-favored-nation treatment for her ex-ports. Foreign countries may be more willing to modify theexisting restrictions when, with the stabilization of themark, Germany's competition on foreign markets becomesmore normal in character.

(8) We conclude that, in the conditions we postulate, animmediate stabilization is possible by means of Germany'sown efforts. Indeed, we go further. Certain technicalconditions are now present—the large gold reserve, thescarcity of currency, the margin between external depre-ciation on the one hand and the degree of internal inflationand internal depreciation on the other—which render theposition unusually susceptible to control. At the rate of3,500 marks to the dollar the gold in the Reichsbank nowamounts to about twice the value of the note issue. Thisis an unprecedented situation. No other currency hasfallen into decay with so great a potential support stillunused.

(9) We think it would be imprudent to attempt thestabilization, which we recommend, except at a low valuefor the mark, although this value might be appreciablyhigher than at present. It is impossible to say at themoment what the rate should be. The recent great col-lapse is mainly due to a failure of confidence, and, if themeasures indicated above are taken, a great improvementmight occur immediately. As an illustration of ouropinion we should, under the conditions existing as wewrite (7,000 marks to the dollar), regard some rate between3,000 and 3,500 marks to the dollar as appropriate. Butit is necessary to remember that at any such rate as this agreat increase in the volume of notes will gradually be-come necessary as the business of the country reverts tonormal conditions. The definite rate to be adopted shouldbe fixed with reference to the internal purchasing powerof the mark and to the position of the external exchangesat the date when the plan outlined in the second part ofour report is put into operation, the general lines of theplan having been announced some short time previously.

It is evident that, after stabilization is fully accom-plished, a new unit, being some multiple of the stabilizedpaper mark, should be adopted for general conveni-ence.



(1) In return^'for a suspension of payments under thetreaty of Versailles for a period of two years, the GermanGovernment should offer to the Reparation Commissionthe following definite guarantees:

(a) That an independent board of exchange controlwould be constituted as a special department within theorganization of the Reichsbank and that the Reichsbankwould hold adequate gold from their reserves at theservice of the board.

(b) That so long as any part of such gold is unpledged,paper marks shall be purchased by the board of exchangeon demand, at a fixed rate to the dollar, this fixed rate tobe determined on the principles outlined in the first partof our report.

(c) That the aggregate value of the net floating debt shallnot be increased beyond a definite figure; all other Govern-ment requirements for credit to be covered by fundedloans.

No modification to be made in the above without thepermission of the Reparation Commission.

It would be necessary, further, for the ReparationCommission, on the one hand, and the German Govern-ment, on the other, to exempt the resources of the boardof exchange from interference.

(2) On the consent of the Reparation Commissionbeing obtained to the above, the following measures tobe taken:

(a) The financial cooperation and support of an inter-national financial consortium to be invited.

(6) A foreign currency reserve, on such scale as may berequired, to be created on the basis of the gold at thedisposal of the board of exchange, in conjunction with thecredits which may be negotiated with the internationalconsortium from time to time on such security as may beacceptable.

(c) The abolition of all exchange regulations and therestoration of free and unrestricted dealings in exchangeand foreign securities.

(3) The board of exchange to buy and sell foreignexchange on demand (on gold exchange standard princi-ples) against paper marks at fixed rates, the selling ratebeing not above 5 per cent dearer than the buying rate inthe first instance.

(4) The bank rate to be raised to a high rate and dearmoney to be maintained until stabilization is quite secure;but discounts and advances to be made freely at this ratefor regular trade transactions against all normally approvedsecurity.

(5) In order to concentrate into its foreign currencyreserves as large an amount as possible of the free foreignassets of German nationals under conditions which wouldinspire confidence:

(a) The board of exchange would issue gold bonds,guaranteed by the Reichsbank, at an adequate rate ofinterest, repayable in gold in one or two years, in exchangefor foreign bank notes, bank balances, etc.

(6) The board of exchange would buy foreign exchangespot and sell it forward at appropriate corresponding ratesfor various periods.

(6) The additional notes required to carry on the busi-ness of the country, as it returns to more normal conditions,would be issued, (a) through trade discounts and trade ad-vances by the Reichsbank, and (b) through the sale of marksby the board of exchange against the receipt of foreign cur-rency and, to the least possible extent and for a period notexceeding six months, against further treasury bills issuedto cover the budgetary deficit during the transitionalperiod before the budget can be balanced.

(Signed)

BERLIN, November 7, 1922.

R. H. BRAND.GUSTAV CASSBL.JEREMIAH W. JBNKS.J. M. KEYNES.

THE MINORITY REPORT.

Following is the text of the minority report:Question 1. Is any stabilization of the mark possible

in the present circumstances?We reply: Any permanent stabilization of the mark

can not be achieved so long as:(1) No end has been put to the paper money inflation,

the principal cause1 of which at the present time is the'deficit in the German domestic budget and public services.

(2) The balance of payments remains unfavorable inconsequence of excess of imports, the flight of capital fromthe country, the aversion to the mark at home, and thedeliveries in kind and cash payments on account of repa-rations.

Question 2. If not, what essential conditions must becreated in order to render stabilization possible?

Our reply is already contained in the answer to the firstquestion. However, some further elaboration appears tous to be advisable:

(1) The devastating effects of paper money inflationmade themselves felt in Germany, as elsewhere, when inthe course of the war expenditure was no longer met fromthe ordinary tax revenue, but by inverted borrowing;that is to say, by increasing the floating debt. Later onthis inflation was increased by the necessity for procuringfoodstuffs, and, finally, by the deficit in the ordinary andextraordinary domestic budget of the State.

Each inflation, however, leads automatically to furtherinflation, for every time the purchasing power of the papermark is diminished a larger sum is required to transactthe same business.

If the measures taken to stabilize the mark are to havea permanent effect, the causes of inflation, which lie withthe Government, must disappear.

This means to say that the domestic budget of the Statemust actually balance, the actual expenditure must bekept within the limits of the estimates, which should becut down to the lowest possible figure; if the receipts donot suffice to cover expenditures, new sources of revenuemust be opened up. Finally, the extraordinary budgetmust not be burdened with expenditure for investmentsof capital which might be avoided or postponed untilbetter times, nor must the estimates for the extraordinaryexpenditure contain proposals for reparation payments inexcess of surplus from the receipts of the ordinary budget.

To obtain this object it will be necessary to exercise thestrictest economy in State finance, to decrease the staff ofthe Government offices and administrative departments,and gradually to diminish direct or indirect subsistenceallowances.

(2) Unfortunately, we have no exact statistics regardingGermany's present balance of payments, nor even anytrustworthy figures as to the balance of trade. All thatcan be said is that these balances apparently show a con-siderable deficit.

What is the cause of this deficit?(a) The falling off of exports, the reasons for which are

said to lie partly at home and partly abroad. Among thecauses originating at home the decrease in the power ofproduction consequent upon present labor conditions ismentioned. It is not for us to judge upon internal ques-tions of German legislation, but in our opinion both theGovernment and people should make every possible effortto regain this power of production.

The most important external cause is said to be theobstacles placed in the way of the import of Germangoods by foreign countries. This is a very delicatequestion. Complaints have constantly been heardabroad, and not without reason, of the lively competi-tion of German industry with the industries of the van-



ous countries during the last few years, which has led tothe ruin of several branches of industry.

If Germany wishes the restrictions placed upon hertrade to cease, her competition must be normal; that isto say, it must not be based on the cheapness of her goodsin consequence of the continual depreciation in hercurrency.

In any case, however, it may be said that her balanceof payments can not be adjusted unless she secures somepossibility of developing her export trade.

(6) An abnormal development of imports in the pres-ent circumstances.

The mark has depreciated to such an extent that theconfidence of Germans in their own currency has beenmore than shaken. The result has been the cessation ofsaving and an inclination to spend the mark, either indirect enjoyment or in hoarding up supplies. Wereconfidence to be restored by the commencement ofstabilization, this inducement to import would disappear.

On the other hand, imports are promoted by Germany'sobligation to allow certain foreign commodities to enterthe country, and it is also facilitated by the so-called"hole in the west." It is obvious that if the GermanGovernment remains powerless in this respect, it willhave great trouble in seriously controlling imports andeffectively restricting them. Moreover, at the presenttime the imports of one commodity have increased—i. e., of corn; these have been particularly large thisyear in consequence of the bad harvest in Germany.This factor is only temporary.

Finally, the import of coal is chiefly a result of theobligation to supply coal to the Allies. So long as noother arrangements are made, this cause of an adversebalance will continue to exist.

(c) The flight of German capital abroad and the aver-sion to the mark at home. We have no data which wouldenable us to estimate the extent of this. We are, however,of the opinion that, on the one hand, so soon as stabiliza-tion of the mark was begun one of the reasons for the flightof capital would be removed and there would be a prospectof a general reflux, and, on the other hand, that Germanfinance legislation should take account of the fact that bythe taxation of capital and income in excess of certainlimits, the flight of capital is encouraged and can not beentirely prevented by rigorous regulations.

(d) Finally, Germany has been compelled during thelast tew years and until quite recently to make cash pay-ments and deliveries in kind on account of reparations,which have considerably influenced her balance ofpayments.

We consider that any attempt to stabilize the markwould be futile unless these payments are suspendeduntil there is a prospect of equilibrium being insured.

To sum up, we would say that, as it is one oi the essentialconditions of the stabilization of the mark that the balanceof payments should no longer be adverse to Germany,the above-mentioned unfavorable factors must be removed.The German Government inform us that if they wererelieved for a sufficiently long period from the reparationpayments, they are convinced that a noticeable improve-ment in the situation would speedily set in. We canbut take cognizance of their statement.

Question 3. What means should be adopted for stabili-zation so soon as the essential conditions are fulfilled?

So soon as the essential conditions described above arefulfilled or are on the way to realization, we propose thefollowing measures:

In view of the fact that in the present circumstancesthe paper mark has entirely lost its character of standardof value, steps must be taken in the immediate futurefor the creation of a new and stable standard of value.This would best take the form of a new gold mark. In

face of the present impoverishment of the entire economicstructure of Germany, it will, however, be advisable toabandon the former unit of value and to select a lowerunit, which in order to facilitate conversion, should beequivalent to a component of the pound sterling or thedollar; for instance, one-fortieth of a pound, half a shillingor one-tenth of a dollar. This unit should be called the"new gold mark."

With a view to effecting the stabilization of the mark,it would be advisable to create an independent organiza-tion possessing a legal entity, which might, for instance,take the form of a share company and be styled "speciebank," since it would come into existence with theobject of introducing new money.

The initial capital would be fixed at 100,000,000 goldmarks, which must be subscribed by the Reichsbankin gold. The Reichsbank would receive in exchangethe shares of the new "specie bank," so that the assetsof the Reichsbank would thus in no wise be diminished.

As, however, the creation would require a considerableperiod, we believe that in the first instance a committee,consisting of representatives of the Ministry of Finance,of the foreign lenders, and of the Reichsbank, should beformed, in order to start the first operations for stabiliza-tion.

Reference to the "specie bank" in the following para-graphs should be taken to apply in the meantime onlyto this committee.

Stabilization of the mark can only be effected withthe assistance of a considerable credit from foreign sources,amounting, for instance, to 500,000,000 gold marks inthe old currency. This credit would most suitably begranted by foreign banks in the form of an acceptancecredit. It must be placed at the disposal of the "speciebank," which could utilize the advance as required bydrawing bills, which would enable it to purchase foreignexchange.

Large banks in the United States of America and inEuropean countries with normal currency would bemost suitable to grant this credit. This group might alsoinclude banks in other countries, which would be ap-proached with a view to their cooperation and declarethemselves willing to participate in the transaction.

Under the auspices of the Reparation Commissionthere should be brought about at the earliest possibledate the appointment of an international committee ofbankers, whose task it would be to form a banking consor-tium, to examine, together with the Reparation Com-mission and the German Government, the question ofthe credit in connection with the guaranties to be given.

We consider it advisable at this point to repeat that finalstabilization can only be achieved provided that conditionswithin the country render possible a stabilization de facto,namely:

(a) By recovering the equilibrium of the budget.(6) By restoring a favorable trade balance in favor of

Germany or at least by restoring its equilibrium.(c) By restoring equilibrium of the balance of payments.As regards (a): Should it be impossible to balance the

budget by increasing the revenue from taxation, anattempt must be made to do so by reducing expenditure.As any considerable addition of revenue will scarcely bepossible, the end will probably only be attainable by areduction of expenditure. In the first place, not onlymust the deficit disappear in the railway and postal admin-istration (including telephones and telegraphs), so that theearnings will cover the working expenses, but these depart-ments should also show surpluses sufficient to insure anadequate depreciation fund and to provide interest uponthe capital invested. Moreover, it is imperatively neces-sary that the various subsidies payable in consequence ofState control, which give rise to a false scale of prices,


JANUARY, 1923. FEDERAL KESEBVE BULLETIN. 49

should be discontinued at the earliest possible date.Finally, arrangements should be made to reduce the num-ber of Government officials.

As regards extraordinary charges, in so far as these relateto necessary and permanent expenditure on railways,canals, etc., it may be remarked that the funds requiredshould be raised by means of internal long-dated loans.We shall refer to reparation payments further on.

With regard to (6): Every means must be tried to restorea favorable trade balance, which would at the same timeexert a beneficial influence on the balance of payments.To this end, in the first place, an increase of productionmust be obtained, both by improving the working methods,by working at increased pressure, and, if necessary, by pro-longing the working hours.

At the same time the question of a reduction of wagesshould be considered, together with their adaptation tothe existing value of money. It can not, however, beexpected that the worker would agree to such measures solong as, on the one hand, the bank would buy up markholdings and banknotes expressed in marks, principallythrough the concentration of their activity, in the foreignmarkets.

By suitable action we believe it would be possibleeffectively to deal with any counteroperations whichmight be attempted and to obtain a very appreciableimprovement in mark exchange on the foreign markets.

To effect an upward movement of the mark is one of theprincipal objects, as the recent collapse of the mark wasmainly due to panic, and the restoration of confidence mayspeedily bring about a countertendency.

Assuming that it is possible in this way to restore themark to an appreciably higher level, the following im-portant advantages will result:

(a) A stop will be put to tho disproportionately heavydepreciation of the mark.

(6) The mark will be placed on a basis which, comparedwith the present position, will not represent the absolutedepreciation of all mark holdings.

(c) The higher theivalueiat which the mark can bestabilized, the sooner will the note circulation suffice forthe requirements of the country.

On the other hand: (a) Definitive adaption of the scaleof wages to the new internal value of the mark will requirea more or less lengthy period, during which very serious

difficulties will have to be overcome; and (b) an appreci-able reduction in prices will be the natural consequence.

Improvement in the economic situation by means ofstabilization will also make it easier for the Governmentto follow a sound economic policy. The budget will thenrest upon a secure foundation and equilibrium will berestored.

If all these desirable consequences are taken into con-sideration, it would certainly appear advisable to makean immediate attempt to effect stabilization, providedthere is a reasonable prospect of the above-mentionedconditions being fulfilled at no remote date.

When the mark has attained a sufficiently high valueevery effort must be made to maintain it at that rate,either by the purchase of foreign exchange when the markappreciates or by purchase of marks if the rate requiressupport. This could best be achieved by an exchangeoffice. The "specie bank" might also take over the func-tions of this office.

The end to be aimed at consists in the restoration of agold currency. Should a transition period be necessary,it might be advisable to leave the paper mark temporarilyin circulation and at the same time to introduce the goldmark as a real currency. We hope, however, that directtransition from paper currency to gold currency may be

It will then be necessary to consider by what methodthe paper mark notes still in circulation can be exchangedfor gold mark notes or corresponding credits. After thesemeasures have been carried out, the abolition of the "speciebank" may be considered, when the Reichsbank wouldresume sole charge of the issue of notes and the manipula-tion of the parity of exchange.

During a certain transition period the increase of thefloating debt could be entirely prohibited; therefore, theGovernment should be given an opportunity of increasingthe floating debt within certain limits, to be prescribedlater, until the favorable effect of stabilization has madeitself felt.

The measures to be taken must be initiated forthwith,as otherwise it is to be feared that any action will come toolate to have any chance of success.

(Signed) G. VISSERING.LEOPOLD DTJBOIS.BORIS KAMENKA.


50 FEDERAL RESERVE BULLETIN. JANUABX, 1923.

BUSINESS AND FINANCIAL CONDITIONS ABROAD.UNITED KINGDOM.

THE COURSE OF PRICES.

During the present year prices in GreatBritain have remained comparatively stable.As will be seen from the table below, the netfall between January and November is small,when, compared with the heavy drop recordedin 1921. Similarly, the mean deviations fromthe average for the first 11 months are verymuch smaller than was the case in 1921. Fol-lowing this stability there is yet no indicationof a rise pointing to any considerable indus-trial recovery. This long hesitancy suggeststhat a revival may possibly be delayed owingto the failure of prices of particular classes ofgoods and services to revert to a normal rela-tionship as between themselves. If one set ofprices fails to adjust itself to the general level,this factor may be sufficient to delay recovery.

That some adjustment as between differentclasses of commodities has taken place is sug-gested by the fact that the various indexnumbers of wholesale prices have moved closertogether since the peaK of the 1920 boom. Itwill be seen from the table, for instance, thatthe fall between April, 1920, and November,1922, has been largest in the case of thatindex—the Federal Reserve Board's (speciallyconstructed for international comparison)—which reached the highest point during theboom period, and, conversely, has been smallestin the case of the Economist number, whichrecorded the lowest peak of the four. Sincethe differences between the various numbers arelargely due to the different weights given to theseparate classes of commodities, however, itstill appears that some one or more classes ofcommodities or services have failed to alignthemselves with the rest, restoring the inter-relation which characterized the period imme-diately preceding the war. The object of thisdiscussion is to investigate the several availablegroup price levels, in order, if possible, to segre-gate such high-priced commodities or services.The method adopted is that of a considerationof the various elements in the cost of produc-tion of goods. In this way light is also shedupon the profitableness of the various stagesof production.

| INDEX NUMBERS OP WHOLESALE PRICES IN GREATBRITAIN.

[1913=100.)

January.February...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

1922.

Net fall, January-Novem-ber

Average, first 11 months...Mean deviation

April, 1920Fall, April, 1920-Novem-

ber, 1922

1922

Boardof

Trade.

164162160160160160160156154155157

71592.4

325

Statist.

156155157158159159157152150153153

31552.5

313

160

Econo-mist.

159158160159162163163158156158159158

FederalReserveBoard.

01601.9

306

147

170167168167171169171168165163165165

51682.0

334

169

1921

Board ofTrade.

246225211205202198194190187181173168

6520414.4

Spread, April, 1920: 334-306=28.Spread, November, 1922: 165—153-12.Spread, averages, January-November, 1922: 168-155=13.Spread, averages, January-June, 1920: 328—300=28.Spread, averages, June-November, 1922: 167—154=13.

Element of raw materials.—A considerableamount of data is available as to the prices ofthe materials used in manufacture. From thetable below it appears that both the Statist andFederal Reserve Board index numbers of theprices of raw materials agree substantially. Atthe same time the gap (due to fundamental dif-ferences in mathematical method) between theBoard of Trade and Federal Reserve Boardfigures for imports, in which raw materials pre-dominate, was considerably narrowed duringthe period from the peak to the present time,while the levels reached tend to confirm thestatement that raw materials stand at a levela little more than one-half higher than in 1913—that is, at about the same level as the indexesof general wholesale prices. At the same time,consumers' goods show a wider discrepancy,suggesting a maladjustment between wholesaleand retail prices, a subject which will be re-verted to at a later stage.


JANDA.KT, 1923. FEDERAL RESERVE BULLETIN. 51

Raw materials:StatistFederal Reserve Board.

Producers' goods:Federal Reserve Board.

Consumers' goods:Federal Reserve Board.

Goods imported:Federal Reserve Board.Board of Trade

Peak level.

318 (February, 1920).308 (June, 1920)

409 (April, 1920)

311 (June, 1920)

324 (April, 1920)289 (Third quarter,

1920)

November, 1922.

148.166.

146.

172.

165.157 (Third quarter,

1922).

Element of wages.—Since labor costs absorba proportion of the prices both of raw materialsand manufactured goods which vary widelyin different cases, evidence as to the level ofwages is not of uniform importance throughoutthe productive process. Nevertheless, its im-portance is so considerable in every branch ofproduction that -no discussion of costs couldafford to omit this element. There are twoavailable sources of information on the subject.The first is the Ministry of Labor, whichestimates that the average weekly rates wereat the end of September at a level of 75 to 80per cent above pre-war. This compares withan index of 170-180 at the end of 1920. Thesecond computation, that of Prof. A. L. Bowley,confirms this figure by giving 180 as the levelon November 4, 1922, on the same base as thatused by the Ministry of Labor. The peak,according to these figures, was 277 in January,1921.

The rates of increase vary widely, however,from trade to trade, as will be seen from thefollowing individual numbers from whichBowley's index is constructed.

AVERAGE WEEKLY BATES OF WAGES ON NOVEMBER 4,1922.

[Expressed as percentages of July, 1914, rate.]

Cotton 181Wool 183Coal 123Docks 184Agriculture 184Mean 180

Bricklayer 168Bricklayer's laborer... 185Engineering:

Fitter 146Laborer 178

Compositor 231Kailways 213

The remarkable correspondence betweenthese two independent computations is con-tinued into the field of living costs. TheMinistry of Labor index number shows thatthe cost of living reached the maximum, 276,in November, 1920, and stood at 180 two yearslater.

From the point of view of production costs,it should be remembered that indexes of rates

are not conclusive, for during 1919-20 therehave been reductions of the hours worked pernormal week which would make hourly ratesroughly 10 per cent higher than are shown inthe index. Incidentally, it should be remem-bered that the above figures are no index ofearnings, owing to the incalculable elements ofshort time and overtime.

Element of transportation.—Whether paid byseller or buyer, the cost of moving goods in-evitably enters into the determination of theirfinal price. Hence it is important that, whilefreight rates on the British railways never roseso high as the general level of prices, and,indeed, remained practically at their pre-warlevel until 1920, the reductions made during thepresent year have not sufficed to bring theminto line with commodity prices. The presentlevel is at about 75 per cent above pre-war.1This fact is an interesting reflection on thedisparity between wholesale and retail prices,suggesting that, as compared with 1913,transportation charges are absorbing too largea proportion of the price paid by the consumer,or, reversing the approach, that transportationcharges are so high as to form a deterrent toincreased mobility of goods, and hence traderevival.

vSo far as goods entering into foreign trademust be carried by rail to the port of embarka-tion, so far is foreign trade, equally withdomestic, impeded by high rates. But in thecase of foreign commerce this element is verylargely neutralized by the low level of shippingfreights, which now stand at little more thanone quarter of their 1920 levels. This fact isof peculiar significance in view of the commentson the trade situation in the December, 1922,BULLETIN, page 1428, where it was noted thatforeign trade appeared to be recovering morerapidly than domestic business activity.

Element of capital.—While not strictly in thenature of a cost of production, yet the pricepaid, so to speak, for the use of capital is notwithout its effects on the price paid both forthe materials of industry, for the finishedproduct, and for the means by which thesecommodities are used. The returns on long-term and short-term capital are important bothas indicating, in the case of the former, the costof raising new capital and the extent of profits,and, in that of the latter, the cost of securingaccommodation to augment working capital.The low rate of profits accruing at the presenttime is emphasized by the London Economist

JSee November BULLETIN, p . 1302.


52 FEDEBAL KESERVE BULLETIN. JANUARY, 1923.

figures of the net profits of industrial com-panies.2 These averaged 11 per cent in 1913,reached 16.8 and 16.6 per cent, respectively,in the quarters ending April and July, 1920,and were only 5.9 per cent in the quarterending July, 1922. In order to make thesefigures contemporaneous with other data, itmust be remembered that these rates weredisclosed, and not earned, during the quartermentioned. Profits were therefore highest atthe beginning of 1920, but are now unquestion-ably low.

The charges for short-term accommodationshow similar symptoms. . The rate of discounton six months trade bills averaged 4f | in 1913and 7- T in 1920. Since the second half of1920 and the first of 1921 it has fallen to 3in July, 1922, rising to 3f in November. Asimilar course has been followed by threemonths' bank bills, which are of peculiar im-portance to British trade as acceptances.From an average level of 6 ^ in 1920, Iff wasreached in July, 1922, and a recovery to 2\was accomplished up to November.

The short-money index 3 shows a maximumof 162 (expressed as a percentage of 1913levels) in February, 1921, a precipitous fall to48 in July, 1922, and a subsequent rise to 52.5in the week ending November 3, 1922. Allthese factors agree, even more than the sta-tistics relative to long-term capital, in settingforth the low but recently rising charges forshort-term credit.

Wholesale and retail prices related.—Bearingin mind, then, that of the four factors in pricedetermination which have been considered,wages and inland transportation appear to beabove the general level of wholesale prices, itis now necessary to consider the margin be-tween wholesale and retail price levels. Re-ferring back to the first table used in the pres-ent discussion, it will be seen that the whole-sale index which showed the highest mean devi-ation from the average over the first 10 monthsof the year was that of the Board of Trade.The Ministry of Labor's index of the cost ofliving shows a considerably higher mean devi-ation, 3.5. The relative instability thus shownis, of course, due to the lag of retail behindwholesale prices, which carried over into 1922a considerable part of the decline due to liqui-dation. Between April and November, how-ever, the level of retail prices has been muchsteadier. Thus, during that period there has

been little adjustment between the two sets ofprices.

The following table shows the chief pointsin the recent history of wholesale and retailprices:

MOVEMENT OF WHOLESALE AND RETAIL PRICES.

' See this issue, p . 132.«Prepared by the London School of Economics, from bank rate,

bonkers' deposit rate, three months' bill rate, and day-to-day rate.

May, 1920 (wholesale prices at peak)November, 1920 (cost of living at peak)May, 1921November, 1921May, 1922November, 1922

Wholesaleprices,

Board ofTrade

(average of1913=100).

326.5286.9201.7172.8160.4157.1

Cost ofliving,

Ministry ofLabor(•July,

1914=100).

241276228203181178

If these figures be examined in such a wayas to compare the wholesale figure with theretail figure for the next following date, thusallowing to some extent for the lag, it is clearthat retail prices never reached the levelsattained by wholesale. Their fall, however,was considerably less precipitous, so that byNovember, 1921, they were at a higher levelthan wholesale, and this disparity has beenmaintained, and even widened, by thp smalldrop in wholesale prices during the presentyear. The result is that, in compajison withpre-war levels, the cost of living is about one-sixth higher than are wholesale prices, whilethere is no apparent tendency to return to thepre-war relation.

Apart from any question of a permanentreadjustment, it appears certain that costs ofdistribution are absorbing a larger part of theretail prices of commodities than was the casebefore the war. The level of wages can notbe held solely accountable for this fact, sincethe larger part of the direct wage cost of com-modities is absorbed in the process of produc-tion. On the other hand, the costs of distri-bution are largely attributable to inlandtransportation charges, and these, it hasalready been shown, are at a disproportionatelyhigh level compared with wholesale prices.This, however, can not be the sole factor in thesituation, and is emphasized merely on accountof the ease with which it can be determined.Other factors, no less important, in particularthe high level of taxation, may or may notcontribute to this state of affairs.

Conclusion.—So far as this discussion hasthrown any light on the present industrial



situation in Great Britain, it seems that theseveral disruptions since 1913 between thecost of the different elements which assist indetermining the prices of commodities, whileof some magnitude, are insufficient to accountfor the recent stagnation of trade, which isevidenced by the fact that the course of pricesgives little indication of any substantialrevival.

It is therefore of special significance that,despite some recent improvement in the ex-port trade, the prices of exported commoditiesremain stable. The Board of Trade index wasunchanged as between the second and thirdquarters of 1922, while the Federal ReserveBoard number, despite a temporary mid-yearrise, has registered a net fall of 4 points (158to 154) between January and November. Ina country which engages so predominantly inforeign trade, the absence of revival is un-likely to be attributable to price disparity un-less very strong evidence be produced to supportsuch a conclusion. This lacking, and exportprices failing to show signs of advance inresponse to accumulating demand, presagingindustrial recovery, it may reasonably be con-cluded that Great Britain's ills are external,rather than internal, and that revival waitsupon an amelioration of the economic situationof her foreign markets.

FRANCE.

. THE INTERNAL FLOATING DEBT.4

The size and heavy burden of present-daypublic debts constitute an economic factorsecond to none in the countries of continentalEurope. Among the various items making upthese public debts, the floating debt is mostlikely to be charged with financial dangers. Thepresent article continues the discussion of thegeneral problem of the public debt of Francebegun in the FEDERAL RESERVE BULLETIN forDecember, 1922. It is the object of this articleto consider in detail the internal floating debt ofFrance, which represents a problem of the firstmagnitude in contemporary European finance.

On March 31, 1922, the total public debt ofFrance was carried at 316,984,988,953 francs.Of this, 120,488,259,100 francs represented thefloating debt, being divided into an internaldebt of 87,050,312,100 francs and an externaldebt of 33,437,947,000 francs. Reduced topercentages, these figures show that on the

< For an account of French war finance, see FEDEKAL RESEBVE BUL-LETIN, February, 1921, page 174.

date named the floating debt amounted to 38per cent of the total debt of France; that theinternal floating debt is 36 per cent of the totalinternal indebtedness; and that the externalfloating debt is 44 per cent of the total ex-ternal debt. As the external debt is carriedat the rate of exchange of the day mentioned,its statement in francs is subject to fluctuationfrom one time to another, with consequent effectsupon its ratio to the total indebtedness of thecountry.

The magnitude of the internal floating debtas well as its ratio to the total indebtedness ofthe country attracts attention to it as one ofthe most serious problems of French publicfinance. The principal items of this internalfloating debt are the bons de la DefenseNationale and the advances from the Bank ofFrance.

BONS DE LA DEFENSE NATIONALE.5

Issues during the war.—The bons de laDefense Nationalea were a very importantfactor in war finance. It will be recalled thatin the summer of 1914 the French Governmentissued a 3^ per cent amortizable loan, which,owing to the outbreak of the war, was not atall successful. This failure, combined withthe generally disturbed conditions in the finan-cial market, made a war loan apparently im-possible. The almost unanimous belief thatthe war would be brief also encouraged a policyof short-term financing. By the law of August5, 1914, the French Government was given ex-tensive powers for raising extraordinary funds.The chief sources indicated were short-termtreasury bills (bons) and advances from theBank of France.

Issues of treasury bills had played an im-portant part in financing the war of 1870, andthey had since been resorted to in small vol-umes. On August 1, 1914, there were 427,-000,000 treasury bills in circulation. Theywere a familiar form of investment to bankinginstitutions, but were little understood by thepublic. The banks, however, on account ofthe moratorium and for other reasons, were inno position to purchase them on a large scale.

5In the preparation of this section acknowledgment is due Mr. R. C.Miller, of the United States Bureau of Foreign and Domestic Commerce,who placed at the disposal of the Division of Analysis and Researcha detailed report on this subject.6 The figures for the bons de la Defense Nationale have been taken, sofar as possible, from official sources. Owing, however, to the greatvolume of these bills, their numerous denominations and maturities,and their wide distribution, exact accuracy is difficult to attain. Thefigures for the total bons outstanding were subject to an official correctionof nearly 7,000,000,000francs early in 1922; but at the time this correctionwas made there was no statement as to when the original error crept in.


54 FEDERAL, RESERVE BULIÊXIK. JANUARY, 1923.

To meet the needs of the occasion, M. Kibot,Minister of Finance, by the decree of September13, 1914, announced a special issue of treasurybills, called "bons de la Defense Nationale,and invited public subscription. The billswere issued in denominations of 100, 500, and1,000 francs, maturing in 3 months, 6 months,and 1 year, but all bearing interest at 5 per cent,payable in advance. They were to be receivedat par for subscription to future Governmentloans, with right of preference in such subscrip-tion. They might be redeemed at par atmaturity or might be renewed. As an addi-tional feature introduced late in 1914, the Bankof France announced that it would discountthese bills having not more than three monthsto maturity, and would advance loans on thelonger bills up to 80 per cent of their nominalvalue. Arrangements were made to facilitatethe purchase of these bills so that they couldbe bought at any branch of the Treasury, atpost offices, and banks.

The sale of the bills increased rapidly, thoughthe interest rate on the three-month bills wasreduced, and the limits of authorized issue weresteadily raised, so that it may be said that theact of setting a limit had only nominal signifi-cance. To attract even smaller savings, thedecree of August 20, 1915, announced the issueof these bills in denominations of 5 francs and20 francs. They bore interest at the rate of2 centimes and 8 centimes per month, respec-tively, and sold at par, the interest to be addedat maturity. Thus a one-year, 5-franc billwould be redeemed at 5.25 francs and a20-franc bill at 21 francs. On May 1, 1918,bills of one-month maturity were issued bear-ing interest at 3£ per cent.

The following table shows the subscriptionand outstanding circulation of bons de laDefense Nationale during the war years:

B O N S D E LA D E F E N S E N A T I O N A L E .

[In millions of francs.]

Year.

1914 ffrom SeDt. 15)1915 : : : : : : : : : : : : : : . . : : :19161917. . . .1918

Total subscriptions

Subscribed.

1,69716,39327,67540,09947,791

133,655

Outstand-ing at end

of year.

1,6196,963

12,57419,52122,334

It will be recalled that these bills were re-ceivable at par in subscription to war loans.

This privilege was utilized to a great extent, asis shown by the accompanying table, though itmust be noted that the column "treasurybills" also includes the relatively unimportantitem of the old type of bons du Tre'sor.

F U N D I N G OP T H E B O N S I N W A R L O A N S .

[In millions of francs.)

War loan of— Neti amount.

November, 1915 13,308October, 1916 10,082November, 1917 10,209October, 1918 i 22,163

Total i 55,762

Subscribed in—

Cash. Treasurybills.

6,285 | 2,2445,425 | 3,6935,174! 4,5837,246 [ 13,255

24,130 23,772

This shows very distinctly that the war loansserved the purpose, not only of raising newfunds, but also on an ever-increasing scale, offunding the floating debt as represented by thetreasury bills. In fact, the last war loan, forwhich the subscriptions in treasury bills werenearly double the cash subscriptions, may beconsidered very largely as a funding operation.But such funding was rather expensive. Thehighest rate paid on the bons de la DefenseNationale was 5 per cent. In return for these,accepted at par, the Government exchangedsecurities (rentes) yielding currently from 5.65per cent to 5.83 per cent, and without maturitydate.

From the data given above, it is possible toreach some conclusions on the floating debtpolicy during the war years. First, funds wereprovided for the prosecution of the war at atime when, owing to the weak state of the in-vestment market and the disturbed conditionsof the banks resulting from the moratorium, theGovernment was without other recourse exceptthe issue of paper notes directly or through theBank of France. By the attractiveness of theterms of the above-mentioned bons and thesmall denominations in which they were issued,they discouraged hoarding which otherwisemight have appeared on a large scale, and mighthave necessitated greater issues of Governmentor bank notes. By offering unusual incentivesto thrift, they discouraged extravagance and so,to some extent, the competitive bidding up ofprices. In addition they performed the truefunction of a floating debt, namely, to meet by atemporary expedient the requirements of theGovernment until a more satisfactory disposi-tion of the indebtedness could be provided.


JANOABT, 1923. FEDERAL RESERVE TUTT.T.F.TTTT. 55

Bons de la DSfense Nationale since (he war.—The war finished, the French treasury was con-fronted with a choice between meeting currentdeficits out of long-term or short-term borrow-ing. For several reasons the latter course waschosen. Among the reasons which may becited was the cost of the loan of 1918 and doubtas to the capacity of the country, faced withthe problem of readjusting business, to absorba long-term loan of any magnitude. Probablythe expectation of early receipts from Germanreparations had an influence, as well as a failureto anticipate the enormous expenditures thatwould be necessitated during the next few years.The result was to continue to place dependencein the bons de la Defense Nationale, and fromthe end of December, 1918, to the end of Janu-ary, 1920, the bons outstanding doubled,increasing from 22,000,000,000 francs to 46,-000,000,000 francs. It was only%n December23, 1919, that the Government, through theCredit National, issued a loan, which real-ized 3,960,000,000 francs. It bore a 5 percent coupon, but as it was issued at 495 francs(par 500) and is repayable between 1940 and1995 at 600, besides having lottery features, itis evident that the annual charge was consider-ably more. Moreover, the actual interest rateon this loan was higher than that carried by thebons de la Defense Nationale, none of whichwere taken in exchange for the 1919 issue.

Despite expectations to the contrary, it wasfound impossible to effect drastic reductions inthe rates of interest on the floating debt. Bya decree of December 30, 1918, the rate ofinterest on the 6-month bons was reduced to4£ per cent, other rates remaining unchanged.

The bons attained such popularity that sub-scription to them has increased enormouslysince the war. Early in 1919 two morefeatures were added to the bills, which haveadded to their attractiveness: (1) By the lawof January 26, 1919, they might be crossed withtwo parallel, lines (like crossed checks), andbills so crossed could be cashed only througha bank or by members of the bourse; and (2)by indorsement on the face, a particular govern-mental office might be designated as the soleplace of redemption. This precaution wasfortified by the further provision of March 18of the same year that such crossed bills mustbe indorsed by the person presenting them.The object of these provisions was ostensiblyto protect holders from loss or theft; it mayalso have been to discourage their free negotia-tion in commercial transactions.

In 1920 the Government issued two largelong-term loans, which funded 12,362,000,000francs more of treasury bills.

FUNDING THE BONS THROUGH POST-WAR LOANS.

[Millions of francs.l

Loan of—

Feb. 19,1920 i 15,941Oct. 20, 1920 1 28,089 j

Total. 12,362

These operations again were expensive forthe Government, as the loan of October wasa 6 per cent issue, sold at par, while that ofFebruary, though bearing only a 5 per centcoupon, is redeemable at 150, thus largelyincreasing the rate to maturity. However,the funding of even 12,000,000,000 francs wasof material value in lightening the burden ofthe floating debt. Since 1920, only one fund-ing operation has been undertaken and thatwas small. The Credit National offered inNovember, 1921, a loan to the amount of3,000,000,000 francs, on which 2,941,000,000francs net were realized. Of this, 1,070,000,000francs were subscribed in bons de la D6fen.seNationale, and to this extent it was a fundingoperation. On -this the rate was 6 per cent,the bonds being offered at 498.50 (par 500)repayable at par between 1929 and 1934, butwith lottery features, again providing evidencethat the state of the money market favoredreliance on the bons de la Defense Nationale.The Government issued no loans in 1921, otherthan the two-year treasury bills. The 3 to 5year issue of October, 1922, could be subscribedonly in currency, though it is possible thatsome of the bons may have gone indirectlyfor such a purpose.7

The increase in treasury bills since the warhas been steady and rapid.** The largestexpansion took place in 1919, when the figuresrose to 47,934,000,000 francs, owing to theabsence of competition with other Governmentissues. During the next year the increase wasvery small, leaving the figures at 52,352,000,000at the end of the year, since investors preferredthe two long-term issues referred to above.The^time loans, therefore, though they did notsucceed in effecting a net reduction in the

»That is, by the subscribers obtaining cash through discounting theirbons at the Bank of France.



treasury bills at the end of the year, did pre-vent an undue increase in this item of thefloating debt.

In the year 1921, net sales of the bonsde la Defense Nationale amounted to 17,064,-914,600 francs. If this sum is added to thefigures of December 31, 1920, the total out-standing woujd have been about 68,225,000,-000 francs. Owing to the correction of pre-vious figures it was actually 58,500,000,000francs.

In the spring of 1922 a further attempt wasmade to reduce the carrying charges of thefloating debt. On February 26 the followingscale went into effect; 1-month bills, 3 per cent;3-month bills, 3J per cent; 6-month bills, 4per cent; and 1-year bills, 4-J per cent.

As an inducement to holders of 1-monthbills to renew, the interest rate is raised to 3.30when maturity is extended to 2 months and3.40 when payment is postponed for 3 monthsfrom the date of issue. On March 12, 1922,the emission of 5 and 20 franc bills was sus-pended.

Whether because the interest rate is nolonger sufficiently attractive, or because thereis a lack of investment capital, sales of bonsde la Defense Nationale have shown a decidedfalling off in 1922, as may be seen from thefollowing table:

SALES OF BONS DE LA DEFENSE NATIONALE IN 1922.

Francs.January 1,360,000,000February 305,000,000March 746,000, 000April 689,000,000May 1,362,000,000June 919,000,000July 8 -1,284,000,000August 411,000,000September 468,000,000

Net total (9 months) 4,982,000,000

These figures show that the average monthlysales were only about one-third of what theyhad been in 1921. During 1922 there werethree large Government loans, the two of theCredit National of 4,710,000,000 francs and3,290,000,000 francs, respectively, and that ofthe 3-5 year treasury bonds of 8,191,000,000francs, or approximately 16,000,000,000 francstogether.

The terms of these loans, which were con-sidered successful, were, however, so onerousto the Government that the reason for notattempting to employ them as funding issuesis evident.

* That is, repayments exceeded the net new sales by this figure.

Problems arising from the bons de la DefenseNationale.—The bons de la Defense Nationalehave served as a source of income in amountcomparable to that received from taxes andother revenues from 1914 to 1921.

COMPARISON OP INCOME FROM TREASURY BILLS ANDTAXATION.

[In millions of francs.]

1914 . .191519161917191S1919192019211922 .

Year. Treasurybills."

1,1904, SiS5,643(i,9733 660

2(j, 1513,49s

17,065

Taxa- '•tlon, |

perma- 'nent i

sources. '•

4,196•1,130 i4,932 i5,977 1",2139,707 :

14,94s !16,547 i

1 19,831 I

Warprofitstax.

20957S072

3,2243,169

13,050

of approximately 5,000^000,000 francs be; every month, whether by extension, con-

1 Estimated.

The advantage of these bons de la DefenseNationale during the war period have alreadybeen summarized. The value of this issueto the Government both during the war andafter, justifies the official statement that"the bons de la Defense Nationale wereduring the war and still are the principalresource of the treasury."

Nevertheless, there are several serious dis-advantages in these issues. The outstandingfact is that, even assuming no further increases,there are outstanding over 60,000,000,000francs of maturities due within 12 months ofany given date. Assuming that the maturitiesare evenly distributed, it requires that maturi-tiesmetversion, or new sales.

The second fact to note is the heavy carry-ing charges of these bons. On March 31,1922, when the amount outstanding was60,839,311,000 francs, the computed annualcharge was 2,817,889,400 francs. While thecharge is onerous, it is less than that required byan issue of a conversion loan. This is demon-strated by the interest rate on the Governmentissues noted above, by the rates on the variousCredit National loans floated in recent months,and by the rate on the 3-5 year treasury issueput out in October, 1922. The rate of interestto investors in the last-named issue was6.38 per cent if redeemed in 3 years and6.54 per cent if redeemed in 5 years, whilethe cost for that part of the issue whichwas disposed of through banks has been unof-ficially computed at over 6.75 per cent.


JANUABY, 1928. FEDERAL RESERVE BULLETIN.

A third argument commonly advancedagainst the bons de la Defense Nationale isthat, being easily negotiable, they are ineffect and in a greater or less degree a kindof interest-bearing paper currency. Thereis ample evidence that since the war theyhave been used to some extent as a circulatingmedium. It would seem probable that ifthese bills replaced or supplemented theregular Bank of France notes on a large scale,there would be some reflection of it in prices.A study of price levels does not lend muchsupport to the argument that they circulatefreely. At the end of December, 1918, therewere about 22,000,000,000 francs of bons out-standing. The bank-note circulation at thesame time was about 30,000,000,000 francs.The bons on October 1, 1922, the last availabledate, were about 63,404,000,000 francs, an in-crease of about 200 per cent. The circulationwas about 37,000,000,000 francs, an increase ofabout 23 per cent, while the index of wholesale

{>rices as computed by the Statistique Ge'ne'raleor comparable dates are shown in the follow-

ing table:

INDEX OF WHOLESALE PRICES (STATISTIQUE GENERALE).

[1913-100.]

November . .

Month. 1918

360358353

1922

337352

While such statistics, of course, do notprove that the bons de la Defense Nationaledo not circulate as a purchasing power medium,they tend to show that whatever circulationthey may have seems to have had little effecton prices during the present time, or, indeed,for the last two years.

Nevertheless, the bons de la Defense Natio-nale are a medium of enormous potential creditinflation. Under date of November 24, 1914,the general council of the Bank of Franceissued instructions that the bank could loanmoney on the one-year and six-month bons upto 80 per cent of their nominal value, and thatbons of maturity not exceeding three-monthswould be discounted. As these bons are issuedsolely on the credit of the Government, thepossibilities involved in this ruling are obvious.As a matter of fact, the statements of tha Bank

of France and of the commercial banks do notshow that this privilege has been abused;while, on the other hand, it can not be doubtedthat this feature of the bons has been of greatadvantage to the Government in attractinginactive funds, both of banks and privateindividuals.

Beside the bons de la Defense Nationale,there have been issues of ordinary treasurybills of the pre-war type. Their volume onJuly 31, 1914, was only 427,000,000 francs,almost entirely, if not entirely, held by banksand financial institutions. At no time hasthe amount outstanding exceeded 3,500,000,000francs. On April 15, 1922, the figure was1,413,000,000 francs, though it has sinceincreased somewhat. Ordinary treasury billsto the amount of 542,651,000 francs were soldin September. The ordinary treasury billspresent only the normal features common tosuch issues, and the interest rate is nearlythe same as on the bons de la DefenseNationale.

ADVANCES OF THE BANK OF FRANCE.

Although smaller in volume than the re-ceipts from the bons de la Defense Nationale(except in 1914), the advances of the Bank ofFrance to the State were a very importantfactor in war finance, and still form the secondlargest item of the interior floating debt.

The following table, from the EconomisteEurope'en of August 11, 1922, shows the rela-tive importance of these advances comparedwith other exceptional resources.

PROPORTIONAL DISTRIBUTION OF THE VARIOUS FINAN-CIAL RESOURCES OF THE FRENCH GOVERNMENT.

[In percentages.]

Year.

1914191519161917191S191919201921

Proportion, 1914-1921..

Advancesof banksof issue.1

62.45.67.9

14.512.716.32.0

10.4

Interiorloans.

36.980.962.352.264.353.880.674.2

65.0

Foreignloans.

0.713.529.833.323.022.18.34.7

19.0

Opera-tions to

facilitatepayments

of warclaims.

7.89.1

21.1

5.6

1 Includes relatively unimportant advances by the Bank of Algeria,entirely repaid by Dec. 31, 1920.



The following table shows the actual state ofthis item from the beginning of the war:ADVANCES OF THE B A N K OF FRANCE FOB W A R P U R P O S E S .

[Millions of francs.]

191419151916.191719181919192019211922

Year.Amount ad-vanced dur-

ing year.

3,9001,1002,4005,1004,0508,3501,100

—2,100-900

Outstand-ing at end

of year.

3,9005,0007,400

12,50017,15025,50026,60024,50023,600

These figures do not include the smallpermanent pre-war advances of 200,000,000francs, granted in exchange for its privilege asa bank of issue, -on which the State pays nointerest.

The dangers involved in financing a warwith paper money, issued by the central bankin the form of advances to the State, were recog-nized in France from the first, particularly inview of the fact that the advances from theBank of France bore only 1 per cent interest,9

while the only possible alternative—the treas-ury bills—cost 5 per cent. Therefore, theGovernment resolutely undertook, by the con-vention of September 21, 1914, to follow theprecedents established under similar conditions42 years before. This convention providedthat beginning one year after the cessation ofhostilities the advances would bear 3 per centinterest. The ,2 per cent excess interestwould not go to the profits of the bank, which,it must be remembered, is a private corpora-tion, but into a fund to assist in the amortizingof the advances. Against this amortizationfund, however, the Bank of France mightcharge losses arising from the moratorium—inthis respect following the decision of theBritish Government regarding the Bank ofEngland.

During the war the legal limit of the ad-vances to the State increased irregularly.LEGAL LIMITS OF ADVANCES TO THE STATE DURING THE

WAR.

Date.

Aug. 5,1914.Dec. 26,1914July 10,1915Feb. 10,1917Oct. 4,1917..Apr. 5,1918.June 7,1918.

Advanceauthorized.

2,9003,1003,0003,0003,0003,0003,000

Totaladvances

authorized.

2,9006,0009,00012,00015,00018,00021,000

• The rate was nominally 1 per cent. Actually, owing to a one-eighthper cent tax on the issue, it was only 0.00875 net.

The importance of the table lies in the datesof these authorizations. By the early part of1915 the sale of bons de la Defense Nationale,and later in the year the obligations de la De-fense Nationale, were providing large volumesof funds, while in November, 1915, came thefirst war loan.

No further demands were made on the Bankof France until February, 1917, a period ofabout a year and a half. This is at leastpartly explained by the very large credits ob-tained abroad in 1916. In 1917, however,despite interior and exterior loans, it was againnecessary to appeal to the bank, while in 1918two advances, one in April and another inJune, were required.

At the end of that year the question of re-newing" the privilege of the Bank of Francecame up for consideration. The law of Decem-ber 20, 1918, granting the renewal is given infull in the FEDERAL RESERVE BULLETIN ofApril, 1919, page 339. By this act, the bankpaid 200,000,000 francs in lieu of the tax onwar profits, to cover the period from the out-break of war down to December 31, 1917.For the year 1918, the law being to that extentretroactive, the bank paid into the amortizingfund one-half of the profits of the 1 per centinterest paid by the State, so that its netinterest amounted to only 0.4375 per cent forthat year. Further, 85 per cent of the profits ofthe discounting of treasury bills issued againstadvances to foreign States. As a result ofthese measures the amortization fund, whichhad been provided for by the convention ofSeptember 21, 1914, made its appearance inthe bank statement of December 24, 1918, at437,414,951.57 francs. It may be stated herethat on October 27, 1920, these moratoriumlosses had been covered, and from that datethe amortizing funds could be applied to theadvances to the State.

In the early part of 1919 the State againturned to the Bank of France, from which itobtained by the law of March 5 another advanceof 3,000,000,000 francs, on which the interestrate was set at 0.75 per cent instead of thenominal 1 per cent. The war being over,considerable public sentiment appeared un-favorable to a continuation of the policy ofborrowing from the bank. This was reflectedin the convention of April 24, 1919 (law ofJuly 18, 1919), which, though it granted3,000,000,000 francs, without interest, wasintended to be the last advance. It furtherstipulated that the next loan, whether of rentesor treasury obligations, should be applied toextinguishing this last advance. With this


JANUABY, 1923. FEDERAL. RESERVE BTJIAJETIN.

final convention, the limit of legal advanceswas raised to 27,000,000,000 francs.

It will be recalled that the convention ofSeptember 21, 1914, had stipulated that,beginning a year after the cessation of hostili-ties, the amortization provision should requirean interest rate of 3 per cent on advances.Pursuant to this provision, the 3 per cent ratewent into effect beginning with October 24,1919, while of the 1 per cent on the first21,000,000,000 of advances and the 0.75per cent on the next 3,000,000,000, one-halfwas also carried to amortization. This makesthe net rate to the State one-half of 1 per centon the first 21,000,000,000 francs, and 0.375per cent on the next 3,000,000,000 francs,from which must be deducted the one-eighthof 1 per cent due the State, as mentioned above.

During the year 1919 the financial needs ofthe Government were so great and the cost ofmoney so high that no loan, as contemplatedby the law of July 18, 1919, was floated, though1,350,000,000 francs were repaid in severalinstallments to the bank. As a result, thetotal advances to the State at the end of theyear stood within 1,500,000,000 francs of thelegal limit (December 24, 1919, 25,500,000,000francs). During 1920 the advances rose again,and although, as a result of the loan of Febru-ary, 1920, the advance was reduced from 26,-300,000,000 to 25,300,000,000 francs, this figurecould not be maintained. A ccordingly, a newconvention was entered into on April 13, 1920,by which the legal limit of advances was con-tinued to December 31, 1921, at 27,000,000,000francs, with the proviso that it should bereduced 2,000,000,000 francs on December 31 ofeach succeeding year, beginning with December31,1921. This was confirmed by the conventionof December 29, 1920, which was promptlyratified by law. As a result the legal limit ofadvances was to be 25,000,000,000 francs onJanuary 1, 1922, and 23,000,000,000 francson January 1,1923. The legal limit had stood at27,000,000,000 francs from the law of July 17,1919, to December 31, 1921. The largest sumactually borrowed at any time was reportedin the first week of May, 1921 (26,700,000,000francs), although the average for 1921 (25,-300,000,000 francs) was considerably lowerthan that for 1920 (26,000,000,000 francs).10

The amortization fund had reached, on De-cember 28, 1922, a total of 1,335,383,318 francs,of which 527,794,500 francs were attributed tothe guarantee fund mentioned earlier in this

» Since this article was written it has been reported that by a con-vention concluded in the last week of 1922 the reduction for that yearwill be only 1,000,000,000 francs, making the legal limit for 192324,000,000,000 francs.

article, while the surplus applicable to theamortization of the advances was 796,310,223francs. On this credit balance of the account,the interest, calculated at the net rate of ad-vance to the State, was 11,278,595 francs.

This policy of amortizing the advances hassometimes been criticized on the ground thatit is uneconomical for the State to borrowmoney at over 6 per cent from its citizens, toextinguish loans from the bank on which itpays less than one-half of 1 per cent. Suchcriticism arises from misunderstanding boththe consequences of these advances and thecharacter of the Bank of France itself. Againstthese advances, the bank issues its notes, whichare, of course, fiat money, though these notescirculate alongside of and are indistinguishablefrom the notes issued in response to the actualdemands of commerce. The gradual extinc-tion of these advances in no way impairs thecapacity of the bank to finance the needs ofcommerce; on the contrary, it enhances thecredit of the bank so as to improve thatcapacity.

It is important, furthermore, to recall thecharacter of the bank itself. The Bank ofFrance is a private, or rather, a quasi-publiccorporation. The problems of its conditionand credit, though closely allied to, are dis-tinct from those of the State. The advancesto the State are made against 3-month treasurybills, not differing in essential character fromthe common type of treasury bills, or evenfrom the bons de la Defense Nationale. Thedifference lies in the fact that against thesebills, which have an especially favorableinterest rate, the Bank of France, under itsprivilege, may issue bank notes. Further,the State does not control the bank directlyby laws of Parliament; its relations to thebank are governed by conventions or agree-ments entered into between the Ministry ofFinance and the general council of the bank,subject to ratification by law. While the bankworks in accord and cooperation with theState, their relations are by no means merelythose of principal and agent. This is demon-strated by the nature and tone of the conven-tions, and notably in such instances as thatof the convention of April 24, 1919.

In concluding the discussion of this part ofthe floating debt, reference is necessary to thestatements of its conditions as they fluctuatefrom week to week. These fluctuations, whichmay be considerable, are not necessarily in-dicative of real change. For instance, in theearly months of 1922, the statement of theadvances showed a remarkable decline, in the


FEDERAL RESEftVE BtTLUBTIN. JANUARY, 1923.

last week of April sending at 22,100,000,000francs, or some 2,900,000,000 francs belowtheir authorized limit. This was commonlyregarded as evidence of an important changein the State's account with the bank—actuallyit was but the reflection of a temporary surplusin the treasury occasioned by the receipt of4,710,000,000 francs through the Credit Na-tional loan of February. As these funds weredisbursed for the purpose for which the loanwas raised, the State again resorted to thebank for its current needs.

On the other hand, the note circulation,though affected by these advances, is notsolely dependent on them. Notes may beissued against treasury bills discounted foradvances of the French Government to foreignStates; they may be issued in discountof bons de la Defense Nationale maturing inless than 3 months, and they may be issued,as before the war, to meet the needs of com-merce. The impossibility of following fromweek to week the details of these last two itemsmakes any attempt to explain the fluctuationsin note circulation by reference to the twoforms of advances a matter of conjecture.

NOTE.—On December 28, 1922, the Minister of Financestated that the floating debt had not increased during 1922.As the monthly figures showed a net increase of 4,892,-000,000 francs in bons de la Defense Nationale in the firstnine months alone, it appears that this indicated increasemust have been largely canceled by using the proceedsof the 3-5 year loan of October. In so far as this loan wasused as a funding operation, its terms were heavier thanthose of any issue previously employed for that purpose.

PRICES.

The sharp rise in French prices during thelast quarter of 1922 again brought the pricesituation into special prominence. Since Feb-ruary, 1922, prices in France show an upwardmovement, whether measured by the FederalReserve Board index or that of the StatistiqueG6n6rale. According to the Federal ReserveBoard index, there was a gradual advance toJuly, a sharp decline for August and September,and an abrupt rise in November. Accordingto the index of the Statistique Ge"ne"rale, therise has been practically uninterrupted, butwas especially abrupt for November, continu-ing less sharply in December.

I)etailed analysis of the index of the Sta-tistique Ge'ne'rale shows that the advance hasbeen most pronounced in animal foods, rawmaterials, minerals, and textiles. The increasein minerals can be explained, partly at least,

by the fact that this item was very much outof line in February, and its advance from 242to 311 has partially corrected this position.The cause of this advance probably lies in theincreased demand for iron and steel, whichwas very marked in the fall of 1922. The ex-planation of the rise in animal foods, raw ma-terials, and textiles is doubtless associated withthe exchange situation, and in the case of tex-tiles, with the world price of raw cotton. Smalladvances occurred in food prices, but it is re-markable that the item of vegetable foods roseonly 12 points, while all other items advancedbetween 24 and 128 points.

Analysis of the Federal Reserve Board indexalso shows a turning movement in February,though the total change through Novemberbeing only 23 points. The greatest advanceoccurred in goods imported, with goods ex-ported a not very close second. This is mostlydue to the exchange situation—in the caseof exports partly to the increase in textileprices, which form a very considerable item ofFrench exports. The three items of goodsproduced, producers' goods, and consumers'

foods, showed little change. This seems toemonstrate that the price movement reflected

in the Federal Reserve Board index is largelya result of the rise in exchange on England andthe United States, since goods produced showso little change, while the other two items, pro-ducers' goods and consumers' goods, are natur-ally lagging, as being further removed from theinfluence of international trade. On the otherhand, the index for July is identical with thatfor November, though the average values of thefranc were, respectively, 8.23 cents and 6.86cents.

PRICE MOVEMENTS IN FRANCE DURING 1922.

Month.

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember...OctoberNovember...December

Federal Reserve Boardindex.

Rawmate-rials.

308300305318322327332329323328348

Pro-ducers'goods.

229227229228226230236233234235245

Allcom-modi-ties.

286283287299302303306297293293306

Statistique Generateindex.

Tex-tiles.

36334532631933S372392421418446468473

looas. ! ties<

239288285310310318293292279283289300

3143063073143173253253313293373522


.TANCARI, 1923. FEDERAL. RESERVE BULLETIN. 61

GERMANY.

THE CURRENCY STABILIZATION PROBLEM.11

Economic and financial conditions in Ger-many have been moving in a vicious circlesince the war and have recently become socritical that a general discussion of the situa-tion is opportune. The fall of the mark,which has been a disturbing factor in thecountry's economic life for the past threeyears, has in recent months threatened tocause a complete economic and political col-lapse unless effective measures are adopted tostop the operation of the forces making forfurther depreciation of the currency. Up to the

gresent time the measures undertaken by thererman Government to counteract these forces,

such as the foreign-exchange bill and the lawprohibiting the flight of capital, have beenfutile. More marks are constantly issued,their value continues to fall, prices advance, ashortage of capital and credit is created, andbudgetary estimates of public and privatebodies are thrown out of balance. All of thesefactors are closely interrelated; they are allcauses and all effects, and it is impossible todetermine what are the original causes andwhat the primary effects.

Although Germany faces many intricateproblems which are closely related, stabiliza-tion of the currency appears paramount.So long as the present currenc}^ situation con-tinues it is impossible to put the budget on asound basis, the fixing of real prices and wagesis made impossible, and the redistribution ofwealth, by which the larger part of the middleclass is reduced to poverty, must proceed.Thus, the problem of stabilization becomes apolitical question which at the present time isthe main issue between the two most importantpolitical parties in Germany—the Social Demo-cratic Party, representing the large masses ofworkers, and the People's Party, to which themost important leaders of industry and com-merce belong.

Necessity for stabilization.—There is no dis-pute between the two parties as to the necessityfor stabilization. The controversy centersmainly about the time and method of stabiliza-tion. The statement, nevertheless, is sometimesmade both in Germany and abroad that it is toGermany's advantage not to permit the mark torise, since the present depreciated state of hercurrency is the greatest aid to her foreign trade.

11 This study was prepared in the middle of December, prior to thedeclaration by the Reparation Commission of Germany's voluntarydefault.

The question of whether or not stabilization isnecessary can best be answered by a survey ofthe effects of inflation on both labor and capital.According to German estimates, despite thefact that mark wages had increased about 80times, the purchasing power of German wagesat the end of November, 1922, was about 50per cent less than in 1913. Wages of unskilledlabor have increased about 130 times, repre-senting a purchasing power of 87 per cent of1913, while wages of especially skilled workersand professionals have increased 48 times, rep-resenting a purchasing power of 32 per cent of1913.

The effects of the steady depreciation of thecurrency on capital and the national wealth ofGermany va&y be seen from the following figures:

TOTAL PAR VALUE AND MARKET VALUE OF GERMANSECURITIES IN PAPER MARKS AND IN GOLD.

(In billions of marks.]

kvalueJ

End of 1913 17.4Beginning of Januarv, 1921 • 29.0Beginning of January, 1922 50.6Beginning of July, 1922 74.9Beginning of September, 1922 ' j 79.0

Value (ingold).

31.2118.4438.3683.4850.0

9.77.22.9

' Estimated.

Although one can not gather from thesefigures a very accurate estimate of Germany'stotal corporate wealth, since important changeshave taken place which may have worked to-ward a decrease in value, these figures never-theless give some indication of the actual im-poverishment of Germany.

A clearer picture is gained if one compares theindex numbers of quotations of German stocksin terms of paper marks and in gold marks.

INDEX OF GERMAN STOCK QUOTATIONS.

In papermarks.

In goldmarks.

Average, 1913 j 100January, 1921 \ 265June, 1921 ! 279December, 1921 ! 582May, 1922 : 689July, 1922 j 698August, 1922 ! 864

100.0018.3316.8912.739.975.943.13

Although the value of German securities hasincreased very rapidly since the middle of Oc-tober, 1922, owing to the catastrophic declinein the value of the mark during the last fewmonths, its gold value is probably not higherthan it was in July or August.


62 FEDERAL, RESERVE BUT.T.F.TIK. JANUARY, 1923.

The above figures further show that theprosperity of German industry since the armis-tice was m most cases only apparent, and thatit is impossible to judge Germany's prosperityfrom the dividends paid or the high capitaliza-tion of some of her corporations. The indus-trial machinery in Germany is operating, butin most cases without any real profit.

The foregoing brief survey of the effects ofcurrency inflation is sufficient to prove thegreat necessity for stabilization. This necessityis further increased by the attitude of Ger-many's creditors, who are well aware of the factthat so long as the mark continues to depre-ciate, Germany will not be in a position eitherto limit her floating debt or to balance herbudget, and will as a consequence be unable tomake substantial reparation payments. Sta-bilization of the currency therefore was urgedby the representatives of the Eeparation Com-mission in their last conference with the GermanGovernment in Berlin as the first step towardGermany's reconstruction.

Factors in the problem.—Since stabilizationof the mark is regarded as of vital importanceby both the Germans and the Allies, the ques-tion arises what are the factors involved inthe solution of this problem and how can theybe managed. From the outset it should beborne in mind that the factors involved in thesolution of Germany's present difficulties areeconomic in their nature, while the executionof the various plans of stabilization involves toa large extent political considerations. Evenassuming that the political questions couldbe solved to an extent where they wouldnot undermine the possibilities of stabilizing themark, the success of stabilization depends uponfactors which can not be foreseen, such as thestability of the German Government, its abilityto impose a rigorous taxation system and todecrease expenditures.

A solution of the political difficulties, espe-cially of the reparation question, must thereforebe regarded as a necessary preliminary to anyattempt to solve the economic problems con-nected with the stabilization of the currency.The statement that measures toward thestabilization of the currency be undertaken,regardless of the attitude of the SeparationCommission, is fallacious, for although it is truethat in case the German Government under-took to support the mark with the Reichsbank'sgold, temporary stabilization could be attained,the resumption of payments in cash and inkind for reparation account would in a shorttime deplete the gold stock of the country.

SU economic aspects of the stabilizationproblem may be discussed under two distinctheads, viz, fiscal, such as the budget andbalance of payment; and technical, such asgold redemption reserve, the rate of conversion,method of stabilization, etc.

Germany's budget and balance of paymentshave been controlled since the armistice largelyby reparations, and are at the present time insuch a confused state that it is almost impossi-ble to state whether they could be balanced ina comparatively short time or not.

The technical currency problem, althoughmore intricate than any of the stabilizationschemes carried out during the last 30 years,does not appear to be as difficult as the politi-cal and fiscal problems mentioned before. Themain question that arises is whether Germanyis in a position to stabilize the currency out ofher own resources or whether foreign financialaid is necessary. Probably the principal issueunder this head is the gofd redemption fund.Although opinions differ as to whether or notGermany should risk the gold of the Reichs-bank in an attempt to stabilize the currency,the fact remains, nevertheless, that the totalvalue of the gold held by the Reichsbank atthe present time (middle of December),amounting to 1,005,000,000 marks, exceeds thetotal value of the Reichsbank paper notes out-standing by 434,000,000 marks, as may be seenfrom the following table:

GERMAN MARKS AND GERMAN GOLD SUPPLY.

1921.End of—

First quarter..Second quarterThird quarter..Fourth quarter

1922.End of—

First quarter..Second quarterThird quarter..Fourth quarter

(Dec. IS)

•Reichs-banknotes

outstand-ing

(millionmarks.)

69,41775,32186,384

113,639

130,671169,212316, S70970,202

Approxi-mate

exchangevalue ofmarks(U.S.cents).

1.601.40.95.52

.35

.32

.07

.014

Goldvalue

of papermarks

outstand-ing (U. S.dollars).

1,1101,045

821591

457541223136

Gold reserve ofthe Eeichsbank.

MillionsOI marKS.

1,0921,0921,024

995

9971,0041,0051,005

Millionsof U.S.dollars.

260260244237

237239239

Thus the gold question, which in most casesof stabilization is a very difficult one, depend-ing to a large extent upon the ability of thecountry to float a gold loan abroad, may to acertain extent be regarded as solved so long asstabilization is carried through at a rate notfar in excess of the mark's present exchange


.lANUABY, 1923. FEDERAL, RESEEVE BULLETIN. 63

value. In addition, the low valuation of themark abroad makes it possible for a compara-tively small amount of gold to buy practicallyall paper marks held abroad and thus to elimi-nate a potential factor of speculation.

Should the stabilization be carried outentirely upon the basis of the Reichsbank'sgold, it would in this respect be similar to thatof the Russian currency reform under CountWitte, in which case the gold held by theCentral Bank exceeded the total market valueof the paper notes outstanding. Closely con-nected with this problem are several others, dis-cussed further on, such as the question whetherstabilization should be carried out with or with-out foreign aid, whether stabilization should beeffected immediately, or whether the efforts ofthe Government should be directed at firsttoward preventing further depreciation and en-couraging a gradual and steady improvementof the currency and leaving the final stabiliza-tion to some future date.

Another important problem to be discussedin this connection is the rate at which themark should be stabilized.

Rate of stabilization.—Stabilization of acurrency is in most cases combined with adevaluation of the original par value of thecurrency, which, in fact, means partial repudi-ation. The extent of the repudiation de-pends mainly upon the rate at which theredemption of paper notes into gold is re-sumed. The fixing of the conversion rate isone of the most important and most difficultproblems and involves political as well as eco-nomic considerations. Borrowers of money,chief among whom is the Government, areinterested in having the rate fixed at a lowpoint, while lenders of money and holders ofbonds desire it as high as possible. The rate,however, can not be fixed arbitrarily. Somedefinite basis for the fixing of such a rate mustexist. In Germany at the present time thefixing of the rate is the more difficult since themark has a different valuation at home andabroad. Industrialists are opposed to anybut the current rate, in order to avoid aneconomic crisis, and the payment of a hugecontribution to foreign countries which holdcheaply bought marks. Stabilization at ahigh rate will make it necessary to reducewages and salaries of labor and Governmentemployees, which would lead to labor strug-gles. It is, however, a fundamental conditionof any successful stabilization that there be nowage struggles nor strikes for a prolongedtime. The opinion of the industrial classesis that if the rate of conversion is to be

based on the external value of the mark, agradual rise of domestic prices will take placefor some time, until the internal and externalvalue of the mark axe equalized. If, on theother hand, the rate of conversion is to bebased on the domestic value of the mark, afall in prices is unavoidable, since this wouldmean a sudden rise in the rate of mark ex-change and would affect the prices of im-ported goods, which are of great importancein Germany. Economists in Germany andabroad are well aware of these difficultiesresulting from a too high or too low valua-tion of the mark, and therefore believe thatno definite rate should be fixed at the presenttime. Many are in favor of fixing the valueof the mark within certain limits betweenthe external and internal valuation of thf>mark. This will eliminate many difficultieswhich would be unavoidable if the currencywere to be fixed at a definite valuation. Itmay also happen that the rate of conversionafter it has been once fixed will have to bechanged to a higher or lower level, as thecase may be.

To soive the various political and economicquestions which Germany is facing, DoctorWirth, then German Chancellor, in October,1922, invited Messrs. Brand andKeynes, of GreatBritain; Mr. Jenks, of the United States; Mr.Vissering, of Holland; Mr. Dubois, of Switzer-land; Mr. Cassel, of Sweden; and Mr. Kamenka,of Russia, to study the German economic situa-tion, with a view to determining how and underwhat conditions the German mark could bestabilized. These foreign experts met atBerlin at the same time the Reparation Com-mission held its conferences with the GermanGovernment.

The latter placed before the foreign expertsthe following three questions:

(1) Is stabilization of themark possible underthe present circumstances ?

(2) If not, what essential conditions must becreated in order to render stabilization possible ?

(3) What means should be adopted forstabilization as soon as the essential conditionsare fulfilled 1

After surveying Germany's economic andfinancial structure from all points, of view theforeign experts submitted two reports, knownas the majority and minority reports. Theformer was signed by Messrs. Brand, Cassel,Jenks, and Keynes, and the latter by Messrs.Vissering, Dubois, and Kamenka. In addi-tion, upon special request of the GermanMinistry of Finance, Mr. Brand presented aspecial report in which he set forth his views


64 FEDERAL RESERVE BULLETIN. , 1923.

with regard to the possibility of Germany ob-taining a loan in the London money market.

There is almost no difference between themajority and minority reports as to the neces-sity of stabilization and the preliminary requi-sites for stabilization. Both agree that themark can be stabilized only after a moratoriumof deliveries in cash and kind is granted forsome time. Once the mark is stabilized theybelieve the budget can be balanced and an equi-librium of exports and imports brought about;their views, however, as to the methods to befollowed in stabilization disagree in several im-portant points. Leading features of the tworeports are as follows:13

The majority report suggest*—(1) That the German Government organize a board of

exchange as a special department of the Reichsbank,exempt from interference by the Government and theReparation Commission, which shall redeem paper marksat a fixed rate.

(2) That Germany's gold reserve and the low valuation ofher currency render stabilization practicable.

(3) That assistance of a foreign consortium is desirableto maintain public confidence, but stabilization shouldnot be made conditional upon such assistance.

(4) That a slight increase in the floating debt will benecessary at the beginning.

(5) To stabilize the currency immediately at between3,000 to 3,500 marks to the dollar, a new unit, some mul-tiple of the present mark, to be established in the future.

The minority report recommends—(1) The creation of a new gold mark at about 10 marks to

the dollar.(2) The establishment of a new specie bank.(3) Stabilization of the mark to be carried through only

with the assistance of a foreign loan amounting to atleast 500,000,000 gold marks.

(4) That efforts be made to raise the mark to a highervalue. •

(5) Stabilization of the mark when it has reached asufficiently high rate.

The signers of the majority report believethat the first step toward stabilization after amoratorium is granted should be undertakenby the Germans themselves and that the goldreserves should come from the holdings of theReichsbank. Once the beginning is made bythe Germans, it will not be difficult to form aconsortium of international bankers to givefurther aid to the exchange board. Theystate that the creation of such a fund willhave such a strong moral effect upon the markthat in all probability the fund created by theforeign bankers will not have to be used.

The signers of the minority report, on theother hand, state that confidence in the Ger-man mark must be established first abroadbefore it can be established in Germany. Toreach this point, they think a foreign loan is

•» For full text of the two reports, see pp. 45-49.

indispensable. Thus, according to their views,the reconstruction of Germany's finances cannot be carried out by Germany alone andconsequently a foreign loan is one of thepreliminaries to gradual stabilization of themark.

Another vital point of difference is the timeof stabilization. The majority report expressesthe view that stabilization of the currencyshould be carried through immediately after thepreliminary conditions are fulfilled, and that therate of redemption should be adapted more orless to the internal purchasing power of themark, at which the exchange board should re-deem marks in gold. The minority reportbelieves that immediate stabilization is notexpedient and that the value of the markeven at home is too low at the present time forfixing a final redemption rate. The signers ofthis report believe that the measures suggestedby them, combined with suitable action by theGerman Government, will result in an upwardmovement of the mark. A final fixing of therate should take place only when the valueof the outstanding notes will be sufficient tomeet all the credit needs of the country.

Thus, the majority report advocates an im-mediate stabilization, while the minority reportadvocates a gradual one. Should either schemebe carried out, a sharp decrease in prices will bethe immediate result, followed by unemploy-ment, wage reductions, and labor troubles. Thescheme of the minority report, however, placesthe gold reserve in a safer position, since the"specie bank" could not be forced to redeemthe notes upon presentation. Furthermore,final stabilization under this scheme would takeplace only after the internal and external valueof the mark had been equalized.

The views of the experts differ also consider-ably as to the machinery to be set up in orderto stabilize the German mark. The minorityreport is much more intricate. It goes intomore detail as to the causes of the present situ-ation and provides also for more numerousmeasures to be taken. Nevertheless, it leavesmany questions unanswered, as, for instance,the lack of a stipulation regarding the ratesbetween the new gold mark and the outstand-ing paper marks.

The findings of the foreign experts are ofvery great importance to the understandingof the present financial and economic con-ditions in Germany. They show that althoughthe settlement of the reparation questionis one of the most vital preliminary factorsbefore an attempt to reconstruct Germany'sfinances can be undertaken, the reconstruction



of Germany depends to a very large extentupon Germany herself. In this the views ofthe foreign experts are opposed to the generalopinion of many prominent German businessmen, who state that aid can come only fromabroad. Both reports show more confidencein Germany's ability to recuperate than mostGermans have at the present time. Withoutthe confidence of her own nationals, however,Germany's reconstruction is hardly possible.

Attitude of the German Government.—Accord-ing to the views of the foreign experts, thestabilization of the mark depends to a largeextent upon the German Government. It istherefore not without interest to survey theattitude of the German Government towardthe proposed currency reform. In its finalanswer to the members of the ReparationCommission the German Government statedthat if for a certain period relief were grantedfrom reparation deliveries both in kind andcash, the Reichsbank was prepared to advanceto the German Government 500,000,000 goldmarks for the purpose of stabilizing the mark,provided an equal amount should be forth-coming from abroad. The official Germanviews with regard to stabilization are set forthin the memorandum handed to the ReparationCommission on November 13, 1922, whichmay be summed up as follows:

(1) Final stabilization of the mark can take place onlyafter the reparation question is settled in accordance withGermany's ability to pay. Since, however, due to theconfused state of the German currency, such a step is atpresent impossible, preliminary measures must be takenfor the support and improvement of the mark.

(2) Such preliminary steps can not be carried out byGermany alone. The support of foreign countries isindispensable.

(3) The German Reichsbank has declared its willing-ness to give 500,000,000 gold marks for the project ofimproving the mark.

(4) The preliminaries for such an improvement are:(a) That Germany receive a moratorium of payments in

kind and cash for a period of three to four years. Deliv-eries in kind for the devastated regions, so far as they donot cause an increase in the floating debt, to be continued.

(6) That Germany receive for this "supporting scheme"a foreign loan amounting at least to 500,000,000 gold marks.

(5) The Reichsbank considers the foregoing conditionsnecessary prior to releasing the gold from its reserves.The Reichsbank, however, is unable to guarantee theforeign bank credits.

(6) The money to be advanced by the Reichsbankand by the foreign banks will be administered by anindependent board consisting of representatives of theReichsbank, the foreign banks, and the ministry offinance.

(7) This board will support the value of the currency bybuying mark exchange abroad. This measure will tendto improve the mark rate.

(8) When the progress of stabilization is sufficientlyadvanced, the Government will issue a gold loan. TheGovernment is also ready to float loans abroad.

(9) One half of the proceeds of the internal loan and thefull yield of the foreign loan will be utilized to cover thepayments in cash and kind due under the treaty of Ver-sailles. The other half of the proceeds of the internal loanwill be applied to the requirements of Germany's ownbudget.

(10) These measures will enable Germany to balanceher budget, check the increase of the floating debt, anddiscontinue the discounting of treasury notes with theReichsbank. All dispensable departments will be abol-ished, the number of employees decreased, and the Govern-ment enterprises will be organized on a productive basis.

(11) Germany will take all measures to increase pro-duction, while retaining the 8-hour day as the normalworking day.

(12) After the value of the mark has been improved andstabilized, all protective tariff duties which have beenestablished against German goods are to be abolished.

In order to execute the foregoing plans theGerman Government proposes:

(a) Final settlement of the amount of Germany'sobligations at the earliest possible moment, so that theseobligations, together with the liquidation of the loans, canbe met from an excess of revenue.

(b) Freedom from payments in cash or kind under theVersailles treaty for a period of between three to fouryears with the reservations previously mentioned.

(c) Convocation of a conference of international finan-'ciers to decide upon the bank credit to be accorded toGermany.

(<J) Acceptance of suggestions made by the GermanGovernment to the other countries regarding the grantingof equal economic rights to Germany.

This memorandum depicts very well theattitude of the German Government towardthe reports of the foreign experts and itsviews as to the reconstruction of Germany.In its main points the views expressed hereare similar to those set forth in the minorityreport. The German Government also concursin the belief of the minority report, that finalstabilization can not be carried through at thepresent valuation of the mark, but rather thatmark exchange should only be supported andimproved. In addition, they agree that inorder to prevent an entire collapse, foreign aidis necessary and that the carrying through ofthe various proposals should be based uponthe prior receipt of a foreign loan amountingto at least 500,000,000 gold marks.

REQUISITES OF STABILIZATION.

Reform of Germany's currency throughstabilization of the mark aims at the rees-tablishment of the country's economic equi-librium. The reform, if successful, will insurestability of prices, free business from the specu-lative element which now dominates all trans-actions, and ultimately will bring about con-ditions whereby fiscal legislation can have itsfull effect and in which public revenues willincrease in proportion to expenditures. It


66 FEDERAL RESERVE BULLETIN. .TANDAKY, 1923.

should, h.owever, not be overlooked that thesuccess of stabilization depends not so muchupon the adopting or enforcing of a definitestabilization scheme, as upon the removal ofthe causes which have brought about dis-orderly conditions in the valuation of thecurrency. The exchange problem at the pres-ent time in Germany is therefore not so mucha question of currency as of the entire economicposition of the country. In order, therefore,better to understand the difficulties involvedin the stabilization of the German currency, abrief survey will be made of the three mostimportant factors influencing directly or indi-rectly the valuation of the German mark,namely, reparations, budget, and balance ofpayments.

(1) Reparations.—The entire problem ofreparation has been discussed elsewhere inthe FEDERAL RESERVE BULLETIN (see Novem-ber, 1922, and following issues). In the presentstudy, it is therefore necessary to indicate onlythe influence of reparation on the currency.

According to official figures issued by theReparation Commission, the total paymentsfrom Germany for reparation account untilAugust 31, 1922, amounted to 4,766,356,000gold marks, consisting of 1,447,814,000 cash andforeign currency, and of 3,318,542,000 for vari-ous kinds of deliveries. Since no definite reve-nues have been set aside for these payments, theywere covered to a very large extent b}' increasesin the amount of treasury bills, which were al-most equal to the total increase in the volume ofpaper notes outstanding. Successive increasesin circulation are usually followed by de-creases in the value of the mark at home andabroad. Each decrease in the value of themark, however, necessitates a more rapid in-crease in the amount of paper notes. Payment,for instance, of 500,000,000 gold marks whichat the rate of 1 gold mark to 15 paper markswould mean an expenditure of 7,500 millionpaper marks, calls for 50 billions at the rate of 1to 100, and 400 billions at the present rate of 1to 800. Payments arising out of deliveries inkind increase in the same ratio as home prices.In addition to payments in cash and kind,Germany is bound under the treaty of Ver-sailles to make additional expenditures, such asfor the army of occupation, settlements underthe clearing schedule, etc. Most of these pay-ments must be made in gold or on a gold basisand have the same results upon the budget,floating debt, volume of currency outstanding,as payments in cash Thus, as long as thesepayments are made not but of a surplus of reve-nues over expenditures, but by increasing the

volume of paper notes, any attempt to stabi-lize the currency will be futile.

(2) The hudget.—From the above discussionit is clear how closely the questions of repara-tions and budget are connected. In fact, itmay be said that the critical situation of theGerman budget and the huge excess of expen-ditures over revenues are due primarily to theeffects of reparations and currency deprecia-tion. As already indicated, each decrease inthe value of the mark necessitates an imme-diate increase in the amount of marks to meetexpenditures arising out of reparations or thedomestic needs of the Government. Receiptsfrom taxation and other revenues, on the otherhand, adjust themselves much more slowly tothe depreciation of the currency. Accordingto an estimate of a subcommission of the guar-antees committee the returns from the varioustaxes are distributed as follows:

Pei- cent.Taxes, the returns from which adjust themselves im-

mediately to the internal value of the mark 57Taxes, the returns from which follow the fluctuation

of the mark at a greater distance 12Taxes, the returns from which adjust themselves to

the internal value of the mark only after a periodof about 12 months 24

Returns of taxes which are independent of the valua-tion of the mark 7

100

Thus, while Government expenses increasealmost immediately after each drop in the valueof the mark, a large part of the receipts do notincrease at all or increase only after a consid-erable length of time. Under these conditionsthe budgetary deficit must necessarily increaseeach time that the currency value decreases.In addition, a steady decline in the value of themark makes the further evasion of taxes pos-sible, for each delay in payment means a de-crease of the actual value of the taxes paid.

So long, therefore, as these conditions con-tinue, the issue of paper notes is the only meansat the Government's disposal to meet its con-tantly growing needs, since it can not find thenecessary resources either by taxation or byborrowing. The frequently expressed viewthat the budget should first be balanced beforean attempt is made to stabilize the currency canhardly be accepted. For although the effectsof the budget upon currency and of the currencyupon the budget are mutual, so long as the valueof the currency is liable to decrease, no soundbasis for revenues and expenditures exist. Eachadditional decrease in the value of the markmust necessarily increase expenditures, and,since revenues can not be increased so rapidly,an increase in the floating debt and in the


JANCAEI, 1923. FEDERAL RESERVE BULLETIN. 67

amount of paper notes outstanding is inevi-table. The increase of paper notes is again thecause of new economic disturbances with allthe effects previously discussed.

The effect of the steady depreciation of themark upon taxation can be seen from thefollowing comparative figures which show theactual receipts from taxation and their goldvalue:

PROCEEDS FROM TAXATION DURING THE FISCAL YEAR1921-22.

ila paper marks.

April, 1921 ! 5,356,994,311June, 1921 | 5,785,013,655

5,145,185,2436,185,259,081

August, 1921October,1921 , . ,December, 1921 ! 8,015,259,061February, 1922 J 9,614,260,468March, 1922 | 14,0S5,447,122

Gold equiva-lent.

353,951,917350,526,352256,940,411177,402,711170,910,971194,163,6S4211,746,052

Many economists who have studied Ger-many's financial situation during the last fewyears believe that, even if Germany wererelieved of payments arising out of the peacetreaty, she would be unable to balance herbudget in the very near future. It is pointedout that the deficit in the budget for the fiscalyear 1921-22, arising only from the generaladministration of the Reich and its undertak-ings, amounted to about 128 billion papermarks. Most authorities, furthermore, seemto agree that the balancing of the budget shouldbegin with a decrease in Government expendi-tures, and that new taxes should not be imposeduntil every effort has been made to decreaseexpenditures and until balancing the budgetby this method has been found impossible—for excessive taxation can not be imposedwithout affecting adversely the creation ofsurplus capital upon which the future produc-tive power of the country is based.

(3) Balance of payments.—Another impor-tant requisite for a stable German currency isthe balancing of payments between Germanyand the rest of the world. If Germany con-tinues to have an unfavorable balance of pay-ments for a long period, this would resulteither in the shipping of the country's goldstock abroad or in the floating of loans, which,however, can not continue indefinitely. Tomake an accurate survey at the present time ofGermany's balance of payments is impossible.Many items, such as the flight of capital fromGermany and the accumulation of Germancredits abroad, estimated at between 2 to 8billion gold marks, and the proceeds from, the

sale of paper marks and securities, are un-known. Even the official trade figures pub-lished by the German Government are farfrom reliable.

The equalizing of Germany's balance ofpayments, however, will be one of the mostdifficult tasks connected with the stabilizationof the German currency. For it should not beoverlooked that Germany, whose balance oftrade was unfavorable even before the warand could be balanced only by invisible ex-ports, has lost her colonies, the greater partof her fleet, and important iron and coaldeposits. It has also ceded more land thanindicated by the decrease in population, thusmaking the country to a much larger extentdependent upon food and raw material importsthan ever before. Thus, for instance, at thepresent time the imports of coal amount toabout 45,000,000 gold marks monthly, whilebefore the war coal was exported from Ger-many on a large scale. In addition, Germany'sposition as an exporting country has beenimpaired to a considerable extent by theapplication of one-sided most-favored-nationclauses and the special tariffs imposed by manynations against the importation of Germangoods. To what extent the balance of tradeis against Germany is shown sufficiently byAmerican trade figures, according to whichthe total excess of exports over imports fromthe United States in the trade with Germanyfrom the armistice to the end of September,1922, amounts to $770,000,000.

Up to the present time Germany has beenable to offset the huge excess of imports overexports by selling large quantities of papermarks and securities. The accumulation ofGerman securities abroad and the purchase ofreal estate, rights, etc., by foreigners in Ger-many will, however, be a big item in Germany'sbalance of payments when interest, dividends,and earnings of these German assets will beshipped abroad.

A reduction in the quantity of imports to anextent sufficient to brmg about an equilibriumof Germany's balance of trade is not feasible,as may be seen from the following figures:During the first nine months of 1922, 42 percent of Germany's total imports were com-posed of raw materials, 26.5 per cent of food-stuffs and beverages, 14.5 per cent of partlymanufactured articles, and 17 per cent ofmanufactured articles.

No considerable decrease in imports can takeplace without impairing the standard of livingor the productive capacity of the country,


68 FEDERAL RESERVE BUIXETIN. JANUARY, 1923.

although reduction in the quantity of bever-ages and manufactured goods could be effected.

In spite of these gloomy aspects of the situa-tion, German officials and economists believethat if relieved from payments on reparationaccount for a certain period of time, both in cashand in kind, the balance of payments could beequalized by an increase in production and adecrease in imports to such an extent that itwould not impair the stability of the currency.

Conclusion.—The stabilization of the Ger-man currency appears as the first step towardthe breaking of the vicious circle in which cur-rency, reparations, budget, taxation, and, onemight say, the entire German economy, aremoving. Currency reform, however, if it is tobe successful, involves so many other reformsthat stabilization of the currency is more orless identical with the satisfactory adjustmentof all political and economic problems whichGermany is facing. Some of these problems,such as reparation, are of an internationalcharacter and involve the cooperation notonly of Germany and her creditors, but ofthe entire world. Without placing the repara-tion problem on an economic basis andwithin the physical ability of Germany topay, it is not to be expected that herbudget or her international payments can bebalanced. So long as revenues and expendi-tures do not balance, and so long as the totalamount of receipts and payments from andto other countries are not brought into reason-able agreement, all efforts to stabilize the valueof the mark will prove futile.

Whether or not Germany will be able tosolve these problems or to what extent aid isneeded is an open question. Even if thepolitical problems are solved favorably toGermany, her Government will still face aformidable task in carrying out the reforms nec-essary for the rehabilitation of Germany'seconomic and financial position in the world.

GERMAN PRICE MOVEMENTS.

The rapid decline of the value of the markduring October, November, and the first partof December was immediately followed by anunprecedented increase in prices. The pricemovement has «ssumed such a velocity thateven retail prices often changed several timesduring one day. The increase in prices ofcertain groups of commodities has alreadyexceeded the upward movement of the dollar,as may be seen from the following figures;

GERMAN WHOLESALE PRICE MOVEMENT COMPARED WITHINCREASE IN THE VALUE OF THE DOLLAR IN TERMSOF MARKS.

[Frankfurter Zeitung wholesale price index.]

I

Dollarindex.

Viroup

food-stuffsarid

luxu-ries.

Group 'II,

tex-tilesand

leather.

Croupin,min-erals.

Group

; miscel-lane-ous.

Group !v > Iindus- Alltrial j coin-fin- | mod-

ished I ities.prod- |nets. !

Middle, 1914 100 100 100 100 100 I00l 100October 1922; 51,310, 3S,.i»5 66,157 54,903 32,134 35,025! 43,223November.. 1 148,824 88,980' 153,896 128,982 72,038 57,683 94,492December..] 177,677! 144,753! 266.622 219,395 134,177 118,38ol 166,495

1 , ' i ' I i

The difference between the various groupsneeds but little explanation. The greatest in-crease took place in Group II, textiles andleather articles, which are almost entirely im-ported. The tremendous increase in Group III,minerals, is due to a large extent to the increasein the cost of transportation. An importantchange as compared with previous periods tookplace in Group V, industrial finished products,which reflects very well not only an increasein the price of raw materials, but also a decidedincrease in wages.

The upward movement of wholesale priceswas not without effect upon the cost of living.The index (1913-14 = 100) rose from 19,504 inOctober to 40,047 in November and to 61,156in December, an increase of 105.3 and 213.6per cent, respectively.

The improvement of mark exchange duringthe middle of December, however, caused thegold prices of many German goods, such astextiles, timber, and clothing to exceed theworld market level, since wages and other costof production items could not be reduced asrapidly as the mark increased in value abroad.

FOREIGN TRADE STATISTICS.

All German postwar foreign trade statisticshave been heretofore published in terms ofpaper marks. In view of the enormous de-preciation of the mark and the great fluctua-tion to which the mark is subject, the Statis-tisches Reichsamt with the beginning of Sep-tember, 1922, has adopted a method of pub-lishing the total value of the foreign tradereturns only in gold marks. The valuation ofthe various groups of exports and imports isnow omitted entirely. In the "MonatlicheNachweise iiber den auswartigen HandelDeutschlands," however, in which a detailed


.TAKUART, 1923. FEDERAL. RESERVE BULLETIN. 69

analysis of all commodities imported andexported is published, the values of the variouscommodities are still given in terms of papermarks. The method employed by the Statis-tisches Reichsamt in reducing the values ofexports and imports from paper to gold marksis somewhat complicated. The final valuationof imports represents an arithmetic average ofthe monthly average exchange value of thedollar for the month preceding the importationand the value of these imports on the basis ofworld market prices, mainly as they are quotedin the London market at the time of importa-tion.

According to this method the values of im-ports during the first nine months were:

1922 : C> old marks. ' 1922 ' (Sold marks.

January 330,400,000 .' June 564,600,000February ' 359,600,000 - J u l y 684,800,000March : 563,200,000 ! August 545,100,000April 508,000,000 :: September 421,800,000May 565,200,000 - January-September: 4,542,700,000

Inasmuch as, according to Governmentregulations, the values of exports may beregistered in terms of foreign currencies, about60 per cent of these exports are originally re-ported in this form, so that their gold markvalue can easily be calculated. Since pay-ments for exports are sometimes made beforeand sometimes after the time the actualexports have taken place, the StatistischesReichsamt believes that it is justified in usingexchange rates for the month of exports as abasis for converting the paper mark valuesinto terms of gold marks. In this way theStatistisches Reichsamt arrives at the followingexport figures for the first nine months of theyear:

Gold marks.

January 324,600,000February 297,900,000March..." ; 324,100,000April ! 326,800,000May 391,600,000

1922 Gold marks.

June 416,600,000July ' 320,800,000August 242,000,000September , 280,400,000January-September; 2,924,800,000

ARGENTINA.

Trade conditions.—Recent reports conveythe impression that the general economicsituation of Argentina has continued to im-prove in a satisfactory manner. Commercialactivity is nevertheless still restricted, withmoney abundantly available, as is evidencedby the easy absorption of large amounts of"cedulas" issued lately. The exploitationof petroleum is being gradually developed on

an increasingly broader financial basis. Thelive-stock industry has not materially im-proved, since the low' price of meat continuesto be a deterring factor. The Banco de laNaci6n has announced a reduction of its ratefor loans on live stock from 6£ per cent to6 per cent per annum. The surplus of wheatand linseed from the last harvest, availablefor export, has been substantially reduced,and the yield of the sugar harvest has beensatisfactory. The exportable surplus of wheatas of September 10 amounted to 615,221 tons,against stocks held on August 12 amountingto 1,260,555 tons; while stocks of linseedwere reduced from 163,716 tons on August26, 1922, to 106,803 tons on September 10.The wool season closed on September 30 witha total of exports never before attained. Itis of considerable importance to note, how-ever, that wool exports from Argentina toEurope have shown a striking increase sincethe wool year 1918-19 and that, on the otherhand, exports to the United States have beenconsiderably reduced. The following tableshows the distribution of wool exports fromArgentina by countries of destination.

W O O L E X P O R T S FKOM A R G E N T I N A .

(In metric tons.)

Country of destination. 19IS-19 i 1919-20 1920-21 1921-22

Germany ! ; 11,250France 28,120! 32,360GreatBritain ; 9,970 j 1S,6OOUnited States 1 55,800 ' 30,410Italy j 7,070 i 8,070Netherlands i 5,080 I 5,390Belgium i 4,060 1 17.660Other countries j 8,790 j 3,110

Total 118,890 I 126,850

65,52045,66035,18018,27010,000

26020,9003,900

132,260 I 199,690

With the exception of barley, linseed, corn,and oats, exports of the principal products ofArgentina during the first nine months of theyear compare most favorably with those ofthe previous year. Exports of wheat in-creased from 1,563,400 tons to 3,240,000 tonsin that period, while exports of sheepskinsincreased from 6,600 tons to 21,200 tons.On the other hand, exports of corn duringthe same period decreased from 2,164,700tons in 1921 to 1,560,000 tons in 1922 andthose of linseed from 1,028,300 tons to 741,000tons.

Business failures have increased again, afterhaving diminished gradually since March, 1922.Liabilities of business failures in Argentinawere last reported in the October issue of theBULLETIN for the month of July, 1922. The


70 FEDERAL, RESERVE BULLETIN. JANUARY, 1923.

following table shows the liabilities of businessfailures during the first 10 months of 1920,1921, and 1922.

[In paper pesos.]

Period. 1920

First quarter 11,507, BOOSecond quarter I 6,532,600July I 3,744,500August i 3,021,200September | 4,283,300October

Total during the first10 months i 29,089,200

31, 878,90039, 032, 90012,131, 70011,778,0007, 836,60016, 059, 300

118, 717, 400

1922

;«, 087, 80037, 528, 7006, 708, 6007, 421, 2009, 787, 40011,156,967

105, 690, 667

1 Total during the first 9 months.

An examination of the above figures demon-strates that a decided increase in the amountsinvolved in bankruptcies occurs with seasonableregularity.

Government finances.—A law was enacted bythe Executive on October 2, extending for thelast three months of 1922 the Argentine budgetlaw of 1921. On September 29 the ArgentineCongress declared the budget of 1921 operativefor the last four months of the year, with cer-tain modifications. The following is a compari-son of the estimated Government expenditurefor 1921 and 1922:

[In paper pesos.]

Budget items.

Ordinary expenditure:(a) In cash(6) In bonds

Subsidies and charity..

Year 1921.

442, 720, 005.6855, 436,600. 0014, 753, 470. 00

512,910.075.68

Year 1.922.

508,914, 880.6137, 941, 462.9619,511,733.00

TotalAuthorization to issue bonds of 6 per \

cent and 1 percent I 60,000,000.00Budget estimate of service of the pub- <

lie debt—external and internal i 124,306,484.94 I 140,382,384.85

563,358,076.57

60, 000, 000.00

In the October issue of the BULLETIN (p.1189) a table was published, indicating the.annual deficits incurred by the Government ofArgentina from 1910 to 1918. As a supple-ment to that table the following is presented,showing the revenue, expenditures, and deficitsof the Government of Argentina for the fol-lowing three years of 1919, 1920, and 1921:

1919 . .1920...1921 . .

Year.

In paper pesos.]

Revenue.

368, 365, 574481, 418, 859495,841, 787

Expenditure.

427,910, 636503, 676, 000558,950, 000

Deficit.

59, 545, 06222, 257,14163,108,213

The deficits for the last three years show aremarkable reduction as compared with the

years 1914 to 1918. These deficits have beencovered by the issue of bonds and treasury billsor through advances granted by the Banco dela Nacion, which are included in the floatingdebt of the country. According to data re-cently published by the department of theaccountant general of Argentina the debt ofthe National Government on July 31, 1922,amounted to 1,888,609,353 paper pesos, ofwhich the foreign consolidated debt constituted561,537,346 pesos; the consolidated internaldebt 698,235,344 pesos, and the floating debt628,836,663 pesos. Customhouse receiptsfrom' January 1 to September 30, 1922,amounted to 148,422,900 paper pesos, as against148,216,200 pesos during the same period in1921, or an increase of 206,700 pesos.

The Executive of Argentina has issued adecree providing for the issue of internalbonds by the National Public Credit Bankin an amount not to exceed 60,000,000paper pesos, bearing interest at 6 per centand 1 per cent, cumulative amortizationannually. The bonds and their coupons willbe exempt.from all national and municipaltaxes. Coupons are payable quarterly. TheAdministration of the State Railways has closedarrangements with a London firm for a loan of2,000,000 pounds sterling, payable in 20 yearsor sooner at the option of the Argentine Gov-ernment, bearing interest at 6 per cent. Astipulation has been made in the contract tothe effect that the Government is to pur-chase from the bankers railroad material fora total of 500,000 pounds sterling. Accordingto recent estimates the Argentine Governmentloans maturing before the close of 1922 ag-gregate 492,516,113 paper pesos, in additionto which the accumulated deficit will amountto about 200,000,000 paper pesos.

The government of the Province of BuenosAires has decided to ask for bids on a loan of17,000,000 gold pesos, to be used in the exten-sion and operation of the La Plata-MeridianoV Railway. A large program of public worksis under consideration by the Province and thelocal legislature has been requested to authorizethe investment of 25,000,000 paper pesos inthe construction of public buildings throughoutthe Province. The governor has sent a bill tothe legislature proposing the issue of a loanfor funding the floating debt and to carry outcertain public improvements. Authorizationfor a loan was given by the Chamber ofDeputies and has now been passed in anamended form by the Senate and sent back tothe Chamber for further action. As adoptedby the Senate the bill authorizes the Executive


\ NUARY, 1 9 2 3 . FEDERAL RESERVE BULLETIN. 71

to float a loan amounting to $30,000,000, bear-ing interest at a ratenot to exceed 6 J per cent, 1per cent sinking fund, not obligatory beforeMarch, 1924, the issue price to be not less than 92.The proposal for the above loan has not metwith the approval of the local financial circles.The deficit in the provincial revenue during thefirst eight months of 1922 amounted to about20,000,000 paper pesos.

Authorization has been requested from thelocal legislature by the executive of the Prov-ince of Santa Fe to float an internal loan for35,000,000 paper pesos, the proceeds to be usedfor public improvements in the Province. It isproposed to increase the provincial taxation inorder to cover the deficit for 1922. TheProvinces of Salta, Jujuy, and Mendoza alsohave under consideration financial projects inthe way of loans.

According to the provisions of a decree issuedby the minister of public works, an extraordi-nary credit rfwas opened in favor of the StateRailways in the amount of 14,388,490 paperpesos, of which 11,388,490 pesos will be used inreimbursing the Administration of the StateRailways for expenditures incurred in the con-struction of the railroad from Salta to theChilean border, and the balance to finance theconstruction until December 31, 1922. A fur-ther decree was issued approving the measurestaken by the Administration of State Railwaysin connection with the construction of a sys-tem of light railways in Patagonia at an esti-mated cost of 32,842,754 paper pesos.

Banking conditions.—The Executive of Ar-gentina has requested congressional authorityfor the establishment of branches or agenciesof the Banco de la Nacion Argentina in foreigncountries. According to the provisions ofthe message, the voluminous exchange busi-ness transacted by the bank and the factthat the bank is the financial agent of theGovernment make the proposed step neces-sary. Activity in banking development inArgentina has been noticed lately. The Bancodo Brasil opened a branch in Buenos Aireson October 23, 1922. Serious considerationis being given to the organization of an Agra-rian National Bank. The purpose of this insti-tution would be to give financial assistance tonational production, and the support of theminister of agriculture has been solicited. Anew project has also been reported for theorganization of a maritime bank, with a capitalof 10,000,000 gold pesos, to be engaged in finan-cial operations pertaining to maritime traffic.Favorable consideration has been given bythe Government to the proposal.

A very considerable amount of idle money hasaccumulated in the banks of Argentina duringthe latter half of 1922. The combined cashbalances of the country as of August 31,1922, show an increase of nearly 50,000,000paper pesos in deposits, whereas loan opera-tions increased by not more than 20,000,000pesos. The result, has been that cash on handshowed a considerable increase and it stands atabout 30 per cent for all banks. Rates of dis-count are still nominally 6 to 8 per cent. In-terest paid on deposits has not dropped, andthe majority of the Argentine banks are stillcompeting freely in securing additional depos-its. The following table shows the totalamount of loans and discounts, deposits, andcash on hand of the Argentine banks, as ofDecember 31, 1921, June 30, 1922, and August31, 1922.

[In thousands ot paper pesos.]

Date.Discounts Iand ad-vances, j

Dec. 31, 1921 1 2,543,400JuneSO, 1922 i 2,474,400Aug. 31,1922 | 2,502,900

Deposits.

3,375,1003,347,6003,376,300

Cash onhand.

1,168,5001,139,8001,120,200

The following statement shows the conditionof the Banco de la Naci6n Argentina at theclose of business on September 30, 1922.A previous statement was published in theAugust, 1922, issue of the BULLETIN (p. 955).

[In Argentine pesos.]

Gold. Legal currency.

ASSETS.

7,998.32

Advances on current accountsBills receivableAccounts for collection guaranteedBills discountedRediscounts (laws 9479 and 9577)..Doubtful debts jReal estate IN ational public funds | 8,758,477.05Mobilization of conversion fund, ;

laws 9479 and 10251 ' 20, (XX), 000.00Furniture and fixtures 'Due from the treasury, law 10251 |Conversion accountDue according to the agreement with

England and France, law 10350Cash on hand

373,672,2,854,

20,196,563,183,13,431.19,035;24,495,21,632.

267.93290.80250.86497.65294.11735. 44407.86444.15

34,266,843.21 j23,344,125.08 |

Other assets 1,073,340.00

Total 87,450,783.66

LIABILITIES.CapitalSurplus fundDue foreign correspondentsConversion fund, law 3871Conversion accountMobilization of the conversion fund,

laws 9479 and 10251Deposits..Commissions, interest, and discounts.Due to branchesOther liabilities

24,262,541.67448,938.78

30,000,000.0028,185,139.37

3,277,751.051,276,174.79

207.0430.96

Total | 87,450,783.66

1,550,528.4971,999,663.2564,057,129.29

402,167,798.6914,583,504.25

1,592,859,812.77

150,038,942.14

45,454,545.451,345,805,149.55

38,130,611.7711,806,981.511,623,582.35

1,592,859,812.77


72 FEDERAL RESERVE BULUETIN. JANUARY, 1923.

BRAZIL.

Foreign exchange.—The continued fall ofBrazilian exchange has seriously affected com-merce and industry in general and the importtrade of Brazil in particular. Although hopefor improvement had generalfybeen entertainedat the beginning of November, 1922, due tothe steady rise in the prices of cotton andrubber, exchange continued to fall, and bythe end of the month the dollar quotationhad risen to 9 milreis. Only a slight improve-ment occurred during December, and thegeneral feeling of depression still prevails.Opinions as to the causes of such a depressionare at variance. It is certain, however, thatthere exist at present in Brazil factors, such asthe improved foreign trade of the country,the increase in the prices of its products forexport, and the financial assistance whichBrazil has received lately from abroad, whichwould be expected to bring about a substantialimprovement in the general situation. Accord-ing to the views of the president of the Inter-national Chamber of Commerce of Brazil, thedifficult situation through which the countryis passing at present is due to the fact thatBrazil has not yet fully recovered from theperiod of liquidation caused by reckless ex-penditures during the flourishing years of ex-ceptional commercial activity brought aboutby the war. Others affirm that exchange isnot likely to improve until a change of theGovernment policy with regard to fiscalizationand control of exchanges is brought about.

Toward the end of September, 1922, anorder was issued by the inspector general ofbanks prohibiting interbank exchange opera-tions in accordance with article 37 of Decree14728 of 1921. Far from improving matters,exchange registered a severe drop immediatelyafter the issue of the law in question, and thelaw was rescinded at the beginning of thefollowing month. On November 10, 1922,new regulations for fiscalization of banks andexchanges were issued by the office of theinspector general in addition to those providedfor in the fiscalization laws of March 16, 1921.These were also withdrawn* a few days later asa result of the banks' refusal to deal in ex-change. According to the opinions of severalleading financial authorities in Brazil, not-withstanding that the prohibition of inter-bank exchange operations has been removed,the position has not changed substantially,since the banks continue to be subject to severefiscalization, which hinders to a great extentthe transaction of legitimate exchange business.

It is understood that the new Government isopposed to the present system of fiscalization,particularly that of exchange.

Foreign trade.—In the October, 1922, issueof the BULLETIN (p. 1191) an account was givenof the foreign trade of Brazil during May andJune, 1922. The foreign trade figures for thefollowing two months have been released bythe Brazilian Department of Statistics. Ac-cording to them, the import trade of Brazilduring July showed a striking decrease ascompared with the previous month, but apronounced increase was shown during Augustin both volume and value. Exports, on theother hand, showed an increase in volume andvalue during both months. The value ofexports in pounds sterling during Augustincreased proportionally more than the valueof imports. With the exception of exports in1920, figures showing exports and imports forthe first eight months of 1922 are greater thancorresponding trade figures for the same periodof any previous year. Imports from Januaryto August, 1922, are exceeded only by those ofthe same period of 1913, when a large amountof coal was imported. The following table,giving the volume and value of Brazil's for-eign trade during July and August, 1922, willserve to supplement the table showing theforeign trade of Brazil during previous months,published in the October, 1922, BULLETIN.

FOREIGN TRADE OF BRAZIL.

Month.

JulyAugust..

Total, Jan-uary toAugust...

Metric tons (gross weight).

Imports.

222,392283,269

Exports.

180,129199,130

Excessof im-ports. .

Value in pounds ster-ling (000 omitted.)

Im-ports.

42,263 3,386 4,76884,139 4,446 5,537

Ex-ports.

Excessof ex-ports.

1,3821,091

2,103,260 |l,353,921 :749,339 i 30,123 I 42,058 ; 11,935

The coffee outlook for the 1923-24 cropseems to be quite satisfactory, according toreports from Santos. The Sao Paulo StateDepartment of Agriculture has given thefollowing as an estimate of the 1922-23 coffeecrop:

Bags.Total of SSo Paulo 7,140,000Coffee of Southern Minas 795, 000Coffee of Parana 55,000

Total 7, 990,000

After almost complete suspension of opera-tions in the frozen and chilled meat industryin Brazil, an American company, owning the


JANDAKY, 1928. FEDERAL, RESERVE BULLETIN. 73

largest refrigerating plant in the country, hasannounced that it will resume operationsduring the month of January, 1923. This planthas been closed for over a year, and the reasongiven for its reopening is the considerable im-provement in the price of meat in Europeanconsuming markets.

Government and State finances.—Accordingto a statement issued by the Director of Ac-counts, submitted to the Minister of Finance,the gold in bars and in coin on October 31 wasdistributed as follows:In the general treasury: inmiireis.

Gold in bars 132,406Coined gold 73,102Convertible gold notes 3, 399,393

— — — 3,604,901In the amortization office:

Gold in bars 24, 643, 814Coined gold 58,477, 901

83,121, 715With London financial agents (£135,434 6s 5d). 1, 203, 857

Total 87, 930, 477

The receipts of the Rio de Janeiro custom-house have shown considerable decrease. Dur-ing 1921 the total receipts amounted to76,812,586 milreis, against 110,612,265 milreisin 1920. During the first eight months of1922 the receipts collected amounted to47,687,859 milreis, and, taking 6,000,000 mil-reis as a monthly average, at the close of theyear the total receipts would amount to less"than 72,000,000 milreis.

In the November, 1922, issue of the BULLE-TIN (p. 1318), it was reported that arrange-ments were under way for a small loan to theState of Ceara. According to recent reportsthe loan has been negotiated with a NewOrleans firm, bearing interest at 8 per cent andto mature in 25 years. The proceeds of thisloan are to be used for irrigation works, theconstruction of a municipal hall, and otherimprovements in the capital of the State. Aproject of the budget for 1923 has been sentto the municipal council by the prefect of theRio de Janeiro Federal District. The receiptsare estimated at 83,049,440 milreis and theexpenditures at 88,473,892 milreis, which givesa deficit of 5,423,952 milreis. I t has beenannounced that the State of Bahia has underconsideration the floating of an internal loanfor 70,000 contos of reis, bearing interest at 5per cent. The loan is to be floated throughthe Banco Economico de Bahia.

Banking conditions.—There has been littlebanking development in Brazil lately. TheBrasilianische Bank fiir Deutschland has takensteps toward the opening of a branch in NovoHamburgo, in the State of Rio Grande do Sul.

A new bank has been established in the cityof Bello Horizonte, the capital of the State ofMinas Geraes. The new institution will becalled the Banco do Commercio e Industriade Minas Geraes and its capital will amount to5,000,000 milreis.

The following are the latest statements ofthe condition of the Banco do Brasil, datedAugust 31 and September 30, 1922. State-ments showing the condition of the institutionas of May 31 and June 30, 1922, were publishedin the October issue of the BULLETIN (p. 1192).

[In milreis.]

ASSETS.Capital unpaidPremium on sharesBills discountedLoans in current accountBills receivable:

ForeignDomestic

Securities in liquidationCollateral deposited as securitySecurities depositedBranches and agencies in BrazilCorrespondents abroadCorrespondents in BrazilSecurities owned by banksReal estateLiquidation of Banco da Republica do

BrasilFurniture and fixturesCollections in BrazilRediscount departmentSundry accountsCash:

In currencyIn other form

Total assetsLIABILITIES.

CapitalReserve fundPremium on sharesReserve for rediscount departmentFund for liquidation of old accountsProfit and loss accountDeposits in current account with interest.Deposits in limited accountDeposits without interestDeposits at fixed datesSecurities deposited and in guaranteeBranches and agencies in BrazilCorrespondents abroadCorrespondents in BrazilNational treasury, exchange accountBills receivableCompensation for checks (cleared)Bonus and dividendsRediscount departmentSundry accounts

Total liabilities

Aug. 31, 1922. Sept. 30,1922.

986,280246,570

655,580,739317,978,281

16,993,543158,034,277

631,298286,679,627197,696,751157,431,93814,915,3062,672,043

75,843,5615,939,105

120,2551,398,818

117,078,995209,117,46310,045,490

136,603,8288,171

2,456,002,333

10(1,000,00035,193,314

246,5702,327,8573,307,8034,282,890

333,422,36944,867,671

413,697,897245,747,999484,376,378186,893,454

2,319,2151,170,8208,888,889

266,042,7304,685,6501,164,187

296,789,60620,577,034

2,456,002,333

964,200241,050

666,651,547252,630,938

16,944,354161,937,175

615,632289,727,312217,855,847152,451,55018,768,6002,706,870

66,590,3808,296,952

120,2611,495,587

124,776,968363,841,16111,364,431

119,427,323

2,477,408,138

100,000,00035,199,092

241,050[2,327,8573,176,799

1 4,282,890307,012,535

' 45,637,2331344,581,1311231,35G,705507,583,159207,448,529

1^1,325,195. 11,302,123" 8,888,889278,070,65011,853,2131,119.800

361,513,30424,487,989

2,477,408,138

Recent Banking Developments in Mexico.

The recent banking crisis in Mexico hasserved again to call attention to the difficultyunder which banking institutions are labor-ing at present in that country. Scarcity ofgold for circulation, depreciation of the silvercurrency, absence of rediscount facilities, an un-certain political situation, lack of supervisionover banking, and lack of confidence on thepart of the public may be given as the prin-cipal reasons for the prevailing conditions.


74 FEDERAL RESERVE BULLETIN. JiNOABY, 1923.

Rates of interest at present range from 1 | percent to 2 per cent per month on short-termpaper witn ample security. Silver was at adiscount of as much as 4 per cent in July,1922. The bulk of deposits is held at presentby privately owned banking firms and branchesof foreign banks.

During the month of November, 1922, sev-eral failures among the first of the above twogroups of credit institutions were reported.Of considerable importance has been the sus-pension of payments by the Banque Francaisedu Mexique, which took place on November15, 1922, since this institution was consid-ered to be among the largest in the countryand operated branches in eight of the mostimportant cities of Mexico. The principalreason for these failures is stated to be thedifficulty of obtaining currency within a shortperiod of time, due to the currency strin-gency which has been felt in Mexico sincethe establishment of the monetary system ofthe country on a purely metallic basis. Not-withstanding the high rates of interest whichthe banks at present in operation charge ontheir loans, it is evident that their profits arenot in proportion to their interest charges,since a considerable amount of cash againstdeposits must be held by every conservativeinstitution. This is done in order to pro-mote confidence among depositors and tokeep the banks as liquid as possible in caseof emergency. From the following compar-ative statement of three of the most impor-tant private banking firms in Mexico may beseen the large amount of cash held againstdeposits.

[In Mexican pesos.]

MexicoCity

: Banking' Corpora-i tion, Sept.! 30,1922.

CompaniaBancariaMexicana,S. A., Dec.

31,1921.

CompaniaBancaria

de Paris yMexico,

S. A., Dec.31,1921.

RESOURCES.

Cash and sight exchangeLoans and discountsStocks, bonds, and investments..Customers' liability under letters

of credit and acceptancesAccounts in current accountSundry debtorsSundry accountsProfit and loss accountAccounts per contra 1,

Total

057,051854,724121,302

1,625,804 j 2,727,955774,066 3,950,881

312,284

1,071,786

150,000

ZTCJOre'l

240,000321,94039,856

2,072,6117,526,939 I 5,074,277 25,382,282

3,708,1851,016,6671,607,765

12,058,545

LIABILITIES. !Capital I 1,000,000Deposits i 4,071,406Letters of credit and acceptances..; 904,742Undivided profits i 278,715Eeserve for doubtful loans 'Bills payable lSundry creditors iSundry accounts !

Accounts per contra | 1,272,076Total ! 7,526,939

350,0002,333,290

8,000,0003,990,999

20,054 I16,604 I

272,5209,198

2,072,611

46,112911,266375,361

12,058,5445,074,277 j 25,382,282

* Since the almost total disruption of the greatsystem of Mexican banks during the firstyears of internal struggle in Mexico, the ten-dency among the people has been either tohoard their funds or to deposit them in banksabroad. The total assets of the Mexican banksamounted to about 600,000,000 pesos at the out-break of the revolution in 1910, but in the fol-lowing years, due to currency depreciation andofficial legislation in forcing the banks to acceptrevolutionary paper currency, their resourceswere almost wiped out, and after their reserveshad been taken over by the Government thebanks were finally declared insolvent onSeptember 15, 1916. After that, privatelyowned banking firms and foreign bankinginstitutions were left to transact the financialbusiness of the country. Private bankinghouses were established in many cities of theRepublic, forming a net of correspondents forthe foreign and private banks in Mexico City.The foreign banks also have suffered during theperiods of revolution, but so far no signs ofretrenchment or abandonment of the fieldhave been noticed.

The first step taken toward banking reor-ganization was a decree issued by PresidentObreg6n on January 31, 1921, establishingthe conditions upon which the banks of theRepublic might resume operation or be liqui-dated, depending upon their financial condi-tion. The following is a summary of this-decree:

The legal representatives of the banks whodesired to participate in the benefits of thisdecree had within 30 days after the publicationthereof to present to the department of thetreasury written requests, accompanied bydocuments showing that according to theprovisions of the commercial code, the councilof administration of the bank was legallyconstituted, and that a manager had beenappointed.

The period of 30 days prescribed in the pre-ceding article might be extended to 90 days inthe case of those banks of which the council ofadministration was not legally constituted.

The banks were classified as follows: (a)Those whose assets exceeded their liabilities bj10 per cent; (b) those whose assets exceededtheir liabilities by less than 10 per cent; (c)those whose assets would not cover theirliabilities.

Class (a) institutions might resume opera-tions in accordance with the terms of thisdecree.

Class (&) institutions might resume opera-tions, but only in so far as might be necessary


JANUARY, 1923. FEDERAL, RESERVE B T J U J E T I N . 75

to collect their assets and to pay their liabilitiesaccording to the terms of this decree.

Class (c) institutions were to be delivered tothe appropriate authorities for judicial liquida-tion, and the same procedure was to be followedwith those institutions that did not take advan-tage of the benefits of articles 2, 3, and 4 of thedecree.

The banks referred to in this decree were tocomply with the terms of article 28 of theFederal Constitution and those of the generallaw of institutions of credit and with the regu-lations of this decree, and the old concessionsrespectively were not applicable, even for op-erations initiated prior to May 1, 1917.

Chapter 2 gives the procedure for the liquida-tion of the assets and liabilities of the banks inclasses (a) and (b), and chapter 3 provides forthe liquidation of the banks of class (c).

Several of the banks have succeeded in se-curing authorization to resume operations.Among the most important is the BancoNacional, which was reopened for businesson March 27, 1921.

A law affecting all institutions of credit,domestic and foreign, operating in Mexico,was enacted by the Obreg6n government onJune 23, 1921, obliging them to conform withcertain legal provisions for the protection ofdeposits. The text of the law in reference,which is the only banking law at present inforce in Mexico, follows:

ABTICLB I. Institutions of credit, branches of foreignbanks and all persons or companies engaged in bankingtransactions receiving deposits on sight or for a period notexceeding three days, even when this constitutes currentaccounts, are obliged to keep a metallic reserve in nationalor foreign gold coin, at the rate of 75 centigrams of puregold per peso, to cover 33 per cent of their deposits.

ARTICLE II. The remaining 67 per cent of the depositsabove mentioned will be used exclusively in the follow-ing transactions, which will apply throughout the Republicin all cases:

1. Loans or discounts, provided the due date does notexceed six months, counting from the date of the trans-action, which shall be a commercial one.

2. Credits in accounts current, subject to the provisionsof the preceding fraction.

3. Drafts payable in 90 days, with at least two respon-sible signatures.

4. Deposits in other institutions of credit established inthe Republic.

5. Shares, bonds of immediately negotiable paper,approved by the treasury department.

ARTICLE. I I I . Deposits in foreign money of legal tenderwill be guaranteed in the form provided in the precedingarticles.

ARTICLE IV. The institutions referred to in the presentdecree will be under the supervision of the treasurydepartment which will exercise this attribute throughinspectors, whose duties and powers are specified byarticles 113, 114, 115, 116, and 118 of the law of March 19,1897, and other corresponding regulations. The expensesincurred by this inspection will be for account of theinstitutions.

ARTICLE V. The institutions, persons, or companiescovered by the present decree will forward their balancesheets monthly to the treasury department and the latterwill have these published in the Diario Oficial.

TRANSITORY PROVISION.

This decree will commence to be effective from the15th day of next August (1921).

The provisions of Article I have been modi-fied on account of the recent crisis, and allbanks are required to keep a reserve of 50 percent against total deposits.

Two final tables are presented, the first show-ing the financial condition of the Banco Na-cional de Mexico as of December 31, 1910, andDecember 31, 1920. The second table showsthe financial condition of the Banco de Londresy Mexico on September 15, 1916, the date ofits seizure by the Carranza government, andon June 30, 1920, after the bank had beenreturned to its owners.

FINANCIAL STATEMENT OF THE BANCO NACIONAL DEMEXICO AS OF D E C . 31, 1910, ANI> D E C . 31. 1920.

[In Mexican pesos.]

RESOURCES.

Cash on handIn metallic currency 64,663In notes of other banks 166,990Amounts disposed of by

the secretary of the treas-ury, as follows—

To the national treas-ury 18,575,637

To the "Comision Re-faccionaria de la La-guna" 500,000

To the " Comisi6nMonetaria " 200,000

To the " NacionalMonte de Piedad " . . 200,000

Loans against collateralLoans and discountsSundry accountsCredits in current accounts...Doubtful loansSundry debtorsBonds, stocks, and securitiesOther debtor accountsProfit and lossAccounts per contra

119,707,291

Total..

LIABILITIES.

CapitalReserve fundReserve fund (special)Reserve for doubtful accounts.Reserve for doubtful loansCirculationDepositsBills payableRediscountsSundry creditorsSundry accountsJudicial depositsOther credit accountsProfit and lossAccounts per contra

Dec. 31,1910. Dec. 31,1920.

48,643,286

20,420,34424,624,6823,369,804

40,195,278

19,196,03543,633,182

116,100,603

316,183,214

32,000,00016,000,00012,000,000

1,416,80751,933,69677,047,2341 276,784

501,327

103,645873,467

6,929,652116,100,603

Total j 316,183,214

'19,707,29113,142,1832,050,2973,258,5839,495,146

11,258,10245,389,6579,360,675

17,283,2972,024,4883,135,327

136,105,047

32,000,00016,000,0004,572,656

11,258,10214,131,68131,503,4316,227,272

603,416

9,335,77620,000

7,317,386

'3,'i35,"327

136,105,047

1 This amount should be classed as "Due from Government."appears as "Cash on hand" by order of the Government.


FEDERAL RESERVE BUIJ>ETIN. JANDAEY, 1923.

FINANCIAL STATEMENT or THE BANCO DE LONDRES YMEXICO.

[In Mexican pesos.]._ , - . . , _ _ _

Sept. 15,1916.1 June 30,1920.

CashInvestmentsBuildingsFurniture and fixtures..Due from Government..Sundry debtorsSundry debtor accounts.Profit and loss account..

Accounts per contra.

Total

CapitalReserve lundCirculationSundry creditorsSundry credit accounts.

20,458,336 I13,805,996 i2,644,000 ;

32,156 i11,705,88630,981,5332,094, 330 i6,477,756 I

42,73714,868, 5232,644,000

'29,'232,'26217, 531, 0067,396,1613, 776, 361

88,199,99366,092,105

154,292, 099

75,491,05022, 049,126

97, 540,176

21, 500,000 ;5,919,911 I

37,163,258 !

22,4S0,811 !1,136,013

21, 500, 0005,919,911

26,156,14113, 603,1218,311, 877

i 88,199,993 iAccounts per contra : 66,092.105 : 75,491,050

22,049,126

Total ! 154,292,099 . 97,540,176

It is of importance to note the reduction inthe cash holdings of both institutions and theconsequent increase in the amounts due fromthe Government. Notwithstanding the effortsof both institutions, the amount of notes incirculation has not been reduced in proportionto the considerable reduction of other opera-tions. The notes of the Mexican banks are

quoted in Mexico City at a nominal value.The notes of the National Bank are quoted atpresent at about one-half of their par value andthose of the Banco de Londres are quoted atabout one-fourth of their par value.

With the exception of the opening of a smallbanking house in the port of Salina Cruz and abranch of the Bank of Montreal in Veracruz,no reports have been received which wouldindicate that there are signs of banking de-velopment in Mexico at present. The estab-lishment of a central bank of discount and issuehas been discussed lately, but nothing definitehas been reported.

In February, 1921, President Obregon sub-mitted a bill to Congress proposing an amend-ment to article 28 of the Quere'taro constitu-tion, providing for the establishment of eightbanks of issue throughout the country insteadof a large central institution in Mexico City.The establishment of the latter was to be post-poned until the finances of the country wererehabilitated. However, no legislative actionhas been taken on the matter, and the banks atpresent in existence in Mexico continue tooperate without counting upon assistance incase of emergency and without efficient super-vision. It is certain, however, that promptaction on the subject of banking reorganiza-tion is becoming imperative if confidence inthe credit institutions is to be restored andtrade intercourse is to be facilitated.


JANUAET, 1923. FEDERAL RESERVE BULLETIN. 77

PRICE MOVEMENT AND VOLUME OF TRADE.INTERNATIONAL WHOLESALE PRICE INDEX.

The general trend of wholesale prices in November for most countries was upward, asshown by the indexes of the Federal Reserve Board. There was a 2 point increase in Englishand Canadian prices and a 13 point rise in French prices. With the exception of a rise of 12points in the French index in April, 1922, France has experienced no such rise in prices sincethey were approaching the 1920 peak. The American index as a whole showed a slight decline,but the general tendency of prices was to increase. Japanese prices, on the other hand, showeda definite decline of 2 points.

When converted to a gold basis, the indexes indicate a similar level of prices in the UnitedStates and Japan, and in Canada and England. Due to the continued drop in the value of thefranc, prices of French goods in terms of dollars have fallen to their previous low point of ayear ago.

In England, France, and Canada there were price increases of goods in all stages of manu-facture, while in Japan raw materials rose and producers' and consumers' goods declined,and in the United States there were practically no changes.

In general, the prices of commodities entering into foreign trade, both imports and exports,moved upward in November. Especially in the United States and France have there beensteady increases in these commodities since the early spring.

Treating the several countries as a whole, a material advance occurred in the prices ofagricultural and metal products, and in textiles. Coal prices declined generally, except in Franceand Japan where November brought no changes. On the other hand, there was a widespreaddecline in iron and steel prices.

550

500

450

400

350

300

250

200

150

100

INTERNATIONAL WHOLESALE PRICE INDEXFEDERAL RESERVE BOARD

1913 = 100

••

y

/

y

\

N

\\\

s

\

N

\Vss

1

t t. *-

•s

yl

V

-FRANC•CAN AD•JAPAN

^

EA

J. F. M. A. M. 0. J. A. S. 0. N. D. J. F. M. A. M. J. J. A. S. O. K. D. J. F. M. A. M. J. J. A. S. O. N. D. J. F. M. A. M. J. J. A. S. 0. M. D1919 1920 1921 1922

S50

500

450

hOO

350

300

2S0

200

150

100


78 EESEBVE BULLETIN. JANUARY, 1923.

INTERNATIONAL WHOLESALE PRICE INDEX—FEDERAL RESERVE BOARD.

Y e a r a n d m o n t h .

1919, a v e r a g e . . . . . . .

1921, a v e r a g e . . . . .1921.

N o v e m b e rDecember .

1922.January . . . .FebruaryMarchAprilMayJune. .JulyAugust . .SeptemberOctoberN o v e m b e r . . . . . . .D e c e m b e r . . . . . .

Based on prices In respective currencies.

UnitedStates.

100211239148

145142

142146147149158161165165164165164164

England.

100241314201

177172

170167168167171169171168165163165165

France.

100

478321

292287

286283287299302303306297293293306

Canada.

100207250167

145145

144149150152154153154149144143147147

Japan.

100

181

197193

191185182180180184192184176171169

Converted to gold basis.

UnitedStates.

100211239148

145142

142146147149158161165165164165164164

England.

100221242159

144147

148150151151156154156154150148151157

France.

100

185124

109117

121128134143143138131123116112109

Canada.

100199223150

133135

137145145148152151152149144145147146

Japan.

100

175

1S9186

181178173171171176184176169165164

INDEX NUMBERS OF WHOLESALE PRICES IN THE UNITED STATES.'

[Average prices In 1913*-100.]

Year and month.

1919, average . . . . . .1920, average

1921.NovemberDecember

1922.January.FebruaryMarch. . .AprilMay . . . . .June .JulyAugustSeptember . . . . . .October

December

Goodsproduced.

214242148

142140

139143144146155158162162161161160160

Goodsimported.

174191108

108111

110110111115119124128127128135137138

Goodsexported.

221235136

143141

139142144144155163165162157163173174

Rawmaterials.

209235141

141140

141145147150164167177184181179177177

Pro-ducers'goods.

198237142

128127

127127126129137141143144147150150149

Con-sumers'goods.

221244160

157153

150155157156160164163156154156156157

All com-modities.

211239148

145142

142145147149158181185166164165164164

•Acomplete description of the United States index number, as originally published, may be found in the May, 1920, BULLETIN, pages499-503. Revisions in prices or weights appear in the BULLETINS for June, 1920; June,. 1921; and May, 1922.

INDEX NUMBERS OF WHOLESALE PRICES IN ENGLAND, i

[Average prices in 1913—100.]

Year and month. Goodsproduced.

1919, average1920, average1921, average

1921.November.December

1922.JanuaryFebruaryMarch...AprilMayJune.JulyAugustSeptember. ,OctoberNovemberDecember

315207

182176

174171172171175172172170165160161163

Goodsimported.

247294171

154152

149148147148153154158155157161165163

Goodsexported.

275438183

164158

158151153152155158158159154149154157

Rawmaterials.

226291197

177173

171168170167169167168170166165166166

Pro-ducers'goods.

261355178

153147

147144142143146148147143143144146146

Con-sumers'goods.

241292219

191186

181181183183191186190183177170172175

All com-modities.

Con-verted togoldbasis.

241314201

177172

1701671«8167171ICO171168165163165165

221242159

144147

148ISO1H11115ft1*415615415014S151157

i A, complete description of the British index may be found in the February, 1922, issue of the BULLETIN, pages 147-153.


JANCABT, 1923. FEDERAL RESERVE BULLETIN. 79

INDEX N U M B E R S OF WHOLESALE PRICES[Average prices in 1913=100.]

Year and month .

1920, average1921, average


1922.JanuaryFebruaryMarch . . .AprilMayJune.JulyAugustSeptemberOctoberNovember

Goodsproduced.

466322

290284

284282288302305305306295287285295

Goodsimported.

536313

304303

295286282282288295308309320333362

Goodsexported.

512288

294283

277275272274279292297296301308336

I N FRANCE.!

R a wmaterials.

506341

315313

308300305318322327332329323328348

Pro-ducers'goods.

433248

233

229227229228226230236233234235245

Con-sumers'goods.

474348

305294

299300306327333327325303296290296

All com-modities.

478321

292287

286283287299302303306297293293306

Convertedto goldbasis .

185124

109117

121128134143143138131123116112109

1 A complete description of the French index may be found in the August, 1922, issue of the BULLETIN, pp. 922-929.

INDEX N U M B E R S OF WHOLESALE PRICES[Average prices in 1913=100.]

Year and month .

1919, average '.1920, average.1921, average


1922.JanuaryF e b r u a r y . . . . . .MarchAprilMay

JulyA u g u s t . . .SeptemberOctoberNovember . . . . . . .December.

Goodsproduced.

207249168

144144

143148150152153151153146140141143143

Goodsimported.

204253164

151151

151150150151157162165166170171165167

Goodsexported.

220268181

138137

139152151153154149154144133134138138

I N CANADA.'

R a wmaterials.

197235155

131131

132138140142145143143136133134135135

Pro-ducers'goods.

188255174

152149

147147146146147150152154154155157157

Con-sumers'goods.

227270183

164164

161164166169168168171166157168160161

All com-modities.

207250167

145145

144149150152154153154149144145147147


199223ISO

133135

137145145148152151152149144145147146

1 A complete description of the Canadian index may be found in the July, 1922, issue of the BULLETIN, pp. 801-806.

INDEX NUMBERS OF WHOLESALE PRICES[Average prices in 1913= 100.]

Year and month.

1921, average

1921.November . . .December. . . . . . . . .

1922.JanuaryFebruary......March...AprilMayJUTIfl

JulyAugustS e p t e m b e r . . . . . . . . . . .OctoberN o v e m b e r . . . .

Goodsproduced.

186

204201

198192187186185188197189180173170

Goodsimported.

154

162154

153151153151157166167160156159166

Goodsexported.

173

183192

197186175176183192196189189195194

I N JAPAN.'

R a wmaterials.

154

167167

168163157157164168170161159166173

Pro-ducers'goods.

188

193192

191183183183182191195187177171168

Con-sumers'goods.

193

215209

203198195192189191203196185174167

All com-modities.

181

197193

191185182180180184192184176171169


175

189186

181176173171171176184176169165164

* A complete description of the Japanese index m a y be found in the September, 1922, issue of the B U L L E T I N , p p . 1052-1059.



WHOLESALE PRICES OF INDIVIDUAL COMMODITIES IN THE UNITED STATES.

In order to give a more concrete illustration of actual price movements in the UnitedStates, there are presented in the following table monthly actual and relative figures for certaincommodities of a basic character. The prices have in most cases been obtained from therecords of the United States Bureau of Labor Statistics. This table is published in the BULLE-TIN at quarterly intervals.

[Average price for 1913=100.1

Year andmonth.

19131914.19151916191719181919192019211922

1921.OctoberNovember...December...

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember...OctoberNovemberDecember...

Year andmonth.

1913191419151916191719181919192019211922

1921.OctoberNovember...December...

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember...OctoberNovember...December...

Com, No. 3,Chicago.

Averageprice perbushel.

$0.616.683.722.812

1.6201.5221.5801.397.565.614

.465

.473

.467

.474

.557

.561

.576

.609

.601

.637

.617

.627

.686

.717

.722

Rela-tive

price.

10011111713226324725722792

100

767776

779191949998

103100102112117117

Wool, Ohio, Hgrades, scoured,eastern markets.

Averageprice perpound.

$0,471.440.571.680

1.1451.4391.189.971.508.782

.473

.509

.527

.582

.673

.727

.727

.727

.746

.818

.818

.836

.836

.946

.946

Rela-tive

price.

10093

121144243306248203108166

100108112

124143154154154158174174178178201201

Cotton, middling,New Orleans.


$0.127.113.096.141.226.312.319.330.141.204

.191

.175

.171

.165

.166

.167

.168

.194

.217

.221

.216

.209

.221

.255

.254

Rela-tive

price.

1008976

111178246251260111161

151138135

130130131132153171174170164174201200

Yellow pine,flooring,

New York.

Averageprice perM feet

manufac-tured.

$44,59142.75039.59139.37550.90960.75078.833

145.41793.70894.583

90.00091.00095.500

95.50095.50095.50095.50090.00090.00092.50092.50092.50092.500

100.500102.500

Rela-tive

price.

100968988

114136177326210212

202204214

214214214214202202207207207207225230

Wheat, No. 1,northern spring,

Minneapolis.


$0. 8741.0031.3061.4112.3252.1912.5662.5581.4661.345

1.3191.2541.259

1.3001.5221.5001.5631.5891.4191.4231.1861.0851.1321.2181.251

Rela-tive

price.

100115150162266251294293168154

151144144

149171172179182143148135124130139143

Coal, bituminous,run of mine, f. o.b.

spot at mines,Pittsburgh.

Averageprice pershort ton.

$1,320

6.0432.2032.813

2.1802.1502.150

2.1502.1502.0382.000

4.6003.6753.1632.725

Rela-tive

price.

100

458167213

165163163

163163154152

349278240206

Wheat, No. 2,red winter,

Chicago.


$0.9861.0051.3071. 3512.2782.2102.5372.5231.4351.238

1.1941.1761.177

1.1961. 3S21.3571.3911.3561.1601.1521.0571.0711.1771.2731.325

Rela-tive

price.

100102132137231224239256146126

121119119

121140138141137118117107109119129134

Coal, bituminous,Pocahontas, f. o. b.

spot at mines,Columbus.


•$1,571

5.8893.1804.04b

2.6802.4502.195

2.1502.0751.8251.9752.7503.3064.9555.6885.7505.9386.1256.038

Rela-tive

price.

100

375202258

171156140

137132116126175210315362366378390384

Cattle, steers,good to choice,

Chicago.

Averageprice per

100pounds.

$8. 5079.0398.7029.573

12.80916.36817.49614. 4868.7809.438

8.8758.5638.219

8.1508.6388.7318.4088.6158.8639.700

10.37510. 71310.24510.50010.581

Rela-tive

price.

100106102113151192206170103111

10410197

9610210399

101101114122126120123124

Coke, Connells-ville, at furnace.


$2,4401.8081.7853.2468.2506.0004.738

10.8163.6367.136

3.2752.9702.750

2.7503.0383.2504.4756.0006.750

10.75012.80011.1259.8007.1887.000

Rela-tive

price.

1007473

133338246194443149293

134122113

113125133183246277441525456402295287

Hides, packers,heavy native

steers, Chicago.


$0.184.196.242.262.327.300.393.312.139.180

.148

.158

.165

.165

.160

.139

.134

.146

.168

.182

.201

.213.227.228.204

Rela-tive

price.

1001071321421781632141707698

818690

908775-73799199

109116123124111

Copper, ingot,electrolytic,New York.


$0,157.134.173.275.294.247.191.180.126.134

.127

.130

.136

.136

.129

.127

.126

.132

.136

.137

.138

.138

.137

.136

.141

Rela-tive

price.

10085

1101751871571221148085

818386

868281808486878787878790

Hogs, light,Chicago.

Averageprice per

100pounds.

$8. 4548.3827.1879.400

15. 45917.66318.32614.7118.8919.727

8. ISO6.8697.025

8.16010. 26310.58810.50010.66010.60010. 6959. 6569.6949.4308.2068.269

Rela-tive

price.

1009985

111183209217174105115

978183

971211251241261251271141151129798

Lead, pig,desilverized,New York.


$0,044.039.046.068.091.074.058.081.046.058

.047

.047

.047

.047

.047

.047

.051

.055

.058

.058

.059

.062

.067

.072073

Rela-tive

price.

10088

104155207169131184104132

107107107

107107107116125132132133140151165166

1 On Toledo market, average for last 6 months of 1913.



WHOLESALE PRICES OF INDIVIDUAL COMMODITIES IN THE UNITED STATES—Continued.

Petroleum, crude)Pennsylvania,

at wells.Year andmonth.

1913.1914.1915.1916.1917.1918.1919.1920.1921.1S22.

AverageI price peri barrel.

$2.4501.9171.5292.4833.2003.9744.1355.9753.3143.173

1921.OctoberNovember..December..

1922.JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

Year andmonth.

1913.1914.1915.1916.1917.1918.1919.1920.1921.1922.

1921.OctoberNovember..December..

1922.January.February...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

3.1253. 9004.000

3.3003.2503.2503.2503.2503.5003.3133.0003.0003.0003.0003.000

Rela-tiveprice.

10078621011311621692441351.30

128159163

135133133133133143135122122122122122

Pig iron, basic,Mahoning and

Shenango Valley,at furnace.

Averageprice perlong ton.

$14,70612.87313.741 :19.768 !38.904 !32.50927.697 i42.269 ]21.668 |24.264

19.188 i19.000 '18.62S I

Cotton yarns,northern cones,

10/1 Boston.

Rela-tive

price.

1008893

134265221188287147105

130129127


18.150 |17.750 i17.938 !20.000 I24.600 i25.000 !24. 250 !26.600 i32.625 j80.90027. 750 [24.813 I

123121122136 I167170165181 '222 .210 I189109 i

JO. 221.197.173.265.397.600.534.625.290.361

.383

.366

.33'J

.326

.313

.314

.314

.331

.360

.378

.387

.373

.391

.420

.430

Rela-tive

price.

1008978120179271241282131163

173165153

Leather, sole,hemlock, No. 1,

Chicago.


Rela-tive

price.

Steel billets,Bessemer,

Pittsburgh.

Average j Rela-price per ] tivelong ton. ' price.

).282.302.309.388.535.484 i.528 i.534 |.358 l.350

.340

.340 '

.340

100107110138190172187189127124

121 !121 !121 i

147141142142150163171175168177190192

.340

.350

.350

.350

.350

.360

.350

.350

.350

.350

.350

.350

121124124124124128124124124124124124

J25.789 I20.078 :22.441 i43.946 :69. 856 i47.300 !40.53956.26034.385 I33.990 i

29.00029.00029.000

28.00028.00028.00029.50034.00035.00035. 00036.10039.50040.00037. 75036.500 i

1007887170271183157218133132

112112112

109109109114132136136140153155146142

Worsted yarns, i Beef, carcass,2-32's crossbred, I good native

Philadelphia. ) steers, Chicago.


$0.777.640.788

1.0501.5562.1091.6271.8251.1791.413

1.1501.1501.250

1.2771.3001.2501.3001.3501.4271.4001.4001.4501.5001.6501.650

Rela- { Averagetive | price per

price. I pound.

10082101 !135 i200 j272210235152182

148148161

164167161167174184180180187193212212

$0,130.136.129.138.167.221.233.230.163.150

.164

.173

.164

.154

.145

.145

.145

.145

.145

.148

.155

.155

.155

.155

.155

Rela-tive

price.

100105100107129171180178126116

127133127

119112112112112112114120120120120120

Coffee, Rio, No. 7,New York.


$0. I l l.082.075.092.093.097.179.120072

.103

.081

.088

.093

.090

.096

.108

.110

.110

.104

.100

.102

.102

.108

.111

Rela-tive

price.

100736783

1601086592

8781869799999390929297

100

Flour, wheat,standard patents(1918, standard

war),Minneapolis.

Averageprice per

barrel.

$4.5845.0966.6637.264

11.39110.13111.99812.6758.3267.282

7.4257.1706.881

7.0007.9757.8138.1448.0607.5007.7886.9956.3446.4356.7136.775

Rela-tive

price.

100111145158249221262277182159

162156150

153174170178176164170153138140146148

Hams, smoked,Chicago.


$0,166.167.153.185.252.318.343.334.268.264

.237 !

.224

.215 !

Rela-tive

price.

10010092

111152191207201161159

143 :

135129 !

Steel plates, Steel rails,tank, Pitts- I open-hearth,

burgh. Pittsburgh.


$0,015.012.013.032.056.032.027.033.019,017

.010

.015

.015

.015

.014

.014

.015

.016

.016

.017

.019

.021

.021

.020

.020

Rela-tive

price.

1007886

219376219183222130117

103101

1019494

100105108115127142142135132

Averageprice perlong ton.

$30.00030.00030.00033.33340.00056.15049.26453. 82745.65440.692

Rela-tive

price.

100100100111133187164179152136

Illuminating oil,150° fire test,New York.

Average i Rela-price per tivegallon, price.

221267306309313313301264235232213206

133161184186188188181159141140128124

$0,123.120.121.122.124.170.200.263.243.208

.232

.240

.24.0

.218

.210

.210

.202

.199

.200

.200

.200

.202

.215

.220

.220

10097

101137163213197169

45.25040.00040.000

40.00040.00040.00040.00040.00040.00040.00040.00040.00042.25043.00043.000

151133133

133133133133133133133133133141143143

Sugar,granulated,New York.


$0,043.047.056.069.077.078.089.127.062

188 :195 |195

176 i170 i170164161162162162164174 '178178

.052

.052

.050

.048

.049

.052

.052

.053

.059

.066

.067

.063

.066

Rela-tive

price.

100110130161181183209297144139

122121117

112115121122123138155157146154160162



COMPARATIVE WHOLESALE PRICE LEVELS IN PRINCIPAL COUNTRIES.ALL-COMMODITIES INDEX NUMBERS.'

Year and month.

19131914 . .191519161917191819191920 .19211922

1921.

1922.

AprilMay

July

September

December

Year and month.

1913 »19141915191619171918 . . . .191919201921

1921.

1922.

AprilMavJuneJuly

SeptemberOctober.NovemberDecember.

Bel-gium;Minis-try of

Labor.2

(128)

" 1 0 0

367

374369

3663443483! 63603003643S5408407

Bul-garia;

GeneralStatis-tical

Bureau.

100103137

18 66718 830

•8 1,1661 9402,006

2,0612 155

2,1722,5142,6952,4362,4892,5262,5312,5582 564

Den-mark;

Finans-idende.*

!(33)

"100 i138164228293294382250179

186188

178178177179180180178176180182

EUROPE—continued.

UnitedKing-dom;

Board ofTrade.

(150)

100

307197

173168

164160160160160156154155157

UnitedKing-dom;

Econo-mist."

(44)

10099

123161204225235283181

165

159159162163163158156158159158

UnitedKing-dom;

Statist.1

(45)

100101126159206226242295188

161157

156158159159157152150153153

France;GeneralStatis-tical

Bureau.'

(45)

100101137187262339357510345327

332326

. 314314317325325331329337352362

Ger-many;Frank-furterZei-

tung.5

(98)

is 100

1,9652,130

32,715

4,2176,7037,3847 8519 102

13,97829,11643,22394 492

166, 495

NORTH AMERICA.

UnitedStates;Bureauof LaborStatis-tics.

(404)

10098

101127177194206226147

141140

138143148150155155153154156156

Canada;Depart-ment ofLabor."

(271)

100101110135177206217246182

168170

168166167165166164163162164165

Ger-many;FederalStatis-tical

Bureau.6

(38)

100106142153179217416

1,4861,911

34,182

3,4163,487

3,6656,3556,4587,030

10,05919,20228,69856,601

115,100147,480

Aus-tralia;Bureau

ofCensusand Sta-tistics.'

(92)

" 100141132155170180218167

151148

147148155156157155158159

EUROPE.

Italy;RiccardoBachi.i

(100)

10095

133 '.202 '299 :409364624578

595595

5775275245375585715826015965S0

China(Shang-

hai);Minlstrv

of F1-"nance. s 0

(147)

'i 100

Nether-lands;

CentralBureauof Sta-

tistics.'

(53)

100105145222286392297282181

165165

161161165167162155153156158

ASIA AND

DutchEast

Indies;Statis-tical

Bureau.

133140145

144146

149148146144144142140143143149

18 2321 i» 281

'8 226186

i

170166

164i 164

166! 167

168| 162! 1591 163

Norway(Chris-tiania);Oekono-

miskRevue.'

(93)

" 1 1 58 1598 233a 3418 3458 3223 377

18 269220

276269

260236231230232227225221221220

OCEANIA

India(Cal-

cutta);Depart-ment ofStatis-tics.e(75)

23 100112128147180198204181

180180

178182187183J81178

i 1761 1771 178

Poland;CentralStatis-ticalOffice.

(58)

I'lOO

59,23175,10678,63487,694

101,587135,786152,365201,326275 647

Japan(Tokyo);Bank ofJapan.8

(56)

1009697

117147192236259200

214209

206197194197201195193190188

Spain;Instituteof Geog-raphy

and Sta-tistics."

(74)

100101119141166207204221190

184183

179178176177174174173

NewZealand;Depart-ment ofStatis-tics.

(106)

100104123134151175178212201

191188

186180177175177177174

Sweden;Gote-borgs

Handelsoch

Sjofarts-idning.u

(47)

"100116145185244339330347211

174172

170165164164165163158155154

Switzer-land;Dr.J.

Lorenz.1

(71)

100

195166

182178

176163161160161163163163169170

AFRICA.

Egypt(Cairo);Depart-ment ofStatis-tics.

(23)

24 100102124168207225299171

171160

156: 148• 141i 139

138139138140144147

SouthAfrica;Office ofCensusand Sta-tistics.

(187)

>uoo12714515S170231

132

131

133

1 The number of commodities or quotations used in the computation jof each index is indicated by figures in parentheses at head of each |column. ;

• Average of last half of month.• First of month.< End of month. j• Beginning of month—not always the 1st.• Average for the month.' 38 commodities prior to 1920; 76 commodities during 1921. End of

month.« Based upon price of 52 commodities during 1920; 53 during 1921.• End of year and end of month.

"15th of the month.u Middle of month.

« July 1,1913, to June 30,1914-100"April, 1914=100.» July 1.1912, to June 30,1914=100."July, 1914=100.•« Dec. 31,1913, to June 30,1914=100."January, 1914=100.•8 December figure.18 January figure.«° As of last Wednesday in month.Ji February, 1913-100." A s of Jan. 1.» End of July, 1914=100." Jan. 1,1913, to July 31,19U-100.'• Average for year.


JANUABT, 1923. FEDERAL RESERVE BULLETIN. 83

The foreign index numbers published on thepreceding page are constructed by various for-eign statistical offices, and are sent to the Fed-eral Eeserve Board by cable. The BULLETINfor January, 1920, contains a description of theFrench, Australian, Japanese, and Canadianindexes. A description of the method used inthe construction oi the Swedish index numberappeared in the BULLETIN for February, 1921;the British index number, compiled by theBoard of Trade, was described in the March,1921, BULLETIN; and the Italian index num-ber was discussed in the April, 1921, issue.The December, 1921, BULLETIN contains a de-scription of the index published by the FederalStatistical Bureau for Germany, and the in-dexes for Switzerland, Netherlands, Norway,Bulgaria, Egypt, the Union of South Africa,and the Dominion of New Zealand. The in-dex number for the Dutch East Indies wasdescribed in the BULLETIN for March, 1922,that for Poland in the BULLETIN for July, 1922,while a description of the Belgian index may befound in the October, 1922, issue. The revisedindex of the United States Bureau of LaborStatistics was first published in the July, 1922,BULLETIN ; and a description of the FrankfurterZeitung's new index was given in the issuefor September, 1922. A revised set of figuresfor the Board of Trade index from 1920 to datewas published in the BULLETIN for December,1922, p. 1460.

Lack of space prevents the publication ofgroup index numbers for many of these coun-tries except occasionally, but such figures maybe obtained from the Division of Analysis andResearch at any tune upon request. Refer-ence may be made to the September, 1922,

BULLETIN for a more complete series of groupindex numbers than appears in this issue.

The index numbers for Germany (FrankfurterZeitung) and for Egypt have recently been re-vised and corrected. A complete table show-ing the revisions for the Frankfurter Zeitungindex will be found on page 85. The index forEgypt is as follows:

[1914=100.]

Month.

January. . .February.MarchAprilMayJuneJ u l y . . . . . .AugustSeptemberOctober...November.December.

1921

204180171172170161159158169180171160

1922

156152153148141139138139138140144147

A description of the international price indexnumbers of the Federal Reserve Board for theUnited States, England, Canada, France, andJapan may be found in the BULLETINS forMay, 1920; February, 1922; July, 1922; August,1922; and September, 1922, respectively. Acomparative summary table showing theBoard's international index for these fivecountries appears on page 78.

Index numbers showing the price levels ofseparate groups of commodities in the UnitedStates and a few foreign countries are pre-sented on the following pages. Group indexnumbers computed by the Federal ReserveBoard as part of its international series of priceindexes will be found on pages 78 and 79 ofthis issue.

GROUP INDEX NUMBERS—UNITED STATES—COMMODITIES IN BUREAU OF LABOR STATISTICS INDEX REGROUPED BYFEDERAL RESERVE BOARD.

Kaw materials.

Year and month.

1913..1919..1920..1921.

November..December..

1921.

January..February.MarchAprilM

1922.

M*yJuneJulyAugustSeptember.OctoberNovember..December..

i Agricul-tural

products.

i (21)

100 j.: 250 !-j 255 !• 134 j

130 '130

130140141145152146147138136147160161

Animalproducts.

(21)

100221186110

10b103

109121122120122123130127132132129128

Forestproducts.

(11)

100211312166

175169

167166165167174186188191199204207211

Mineralproducts.

(35)

100180236185

178 ;179

Totalraw ma-terials.(88)

100218229142

137137

Pro-ducers'goods.

(117)

100179214135

125125

178177178180202211241261236218209208

139146147148157159171173168166166167

123118120122125127129129132135136135

Con-sumers'goods.

(199)

100211231159

153151

148150149150151152149150152155157

Allcommodi-

ties.

(404)

100206226147

141140

138141142143148150155155153154156156



GHOUP INDEX NUMBERS—UNITED STATES—BUREAU OF LABOR STATISTICS.

Year and month.

1913191919201921


1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember

Foods.

(110)

Cloths; findj clothing.

(65)

120 I

Fuel andlighting.

(20)

100207220141

139136

131135 ,137137 I138140142138 i138 !140 !143144

100 I253 I295 IISO

180180

176174172171 '175179180 :181 '183188 |192 !194

100181241199

197199

19519119119421022a254271244226218216

Metals |and j

metal jproducts.;

(37) j

Building; Chem-mate- I icals andrials.

(41)

100162 |192 i129 i

i

114 |113

112 I120109113119120121126 ;

134135133131 !

100201261165

163158

157156155156160167170172180183135185

100169200136

129127

12412312r>124122122121122124124127130

Housefurnish-

inggoods.

(31)

100184254 ,195 !

178 '•178

178177175175176170173173173176 '179182

Miscel-laneous.

(25)

100175196128

119121

117117117llfi116114114115116120122122

Allcommod-

ities.

(404)

100206226147

141140

13814114214314815015515S153154156156

REVISED GROUP INDEX NUMBERS-UNITED KINGDOM—BOARD OF TRADE.

Year and month.

1913 average..1920 average1921 average .

1921.

1922.August.September.. . .October

i Cereals.

(17)

100. . ' 273

i 194

158

. . 151143

. '•• 1 4 5144

Meat andfish.

(17)

100263219

178

169174169173

Otherfoods.

(19)

100279 '214

195

161152157162

Totalfood.

(53)

100272209

177

160156157160

Iron andsteel.

' (24)

100358210

160

133132131131

Othermetals

andminerals.

(20)

100252179

153

142140139139

Cotton.

(16)

100480192

199

186185184193

Othertextiles.

(15)

100359172

167

165168170172

Other Total notarticles, i food.

(22) (97)

100 ! 100273 I 329196 , 191

183 171

160 154160 153165 i 154168 i 156

Allarticles.

(150)

100307197

173

156154155157

GROUP INDEX NUMBERS—FRANCE—GENERAL STATISTICAL BUREAU.

Year and month .Animalfoods.

1913 average1919 average1920 average1921 average1922 average

1921.December

1922.SeptemberOctoberNovemberDecember.

(8)

100392503380349

324

346341365387

Vegetablefoods.

(8)

100313427330295

303

279283289300

Sugar,cofl'ee, and

cocoa.(4)

100253422343329

300

333311345364

Allfoods.

(20)

100

a%459355325

313

318313331349

Minerals, i Textiles.|

(7) i (6)

100272449275270

279 ;

305311

100444737355390 j

375 j

418446468473

Year and month.

Sundries.

(12)

100405524374

. 338

364

341347363365

All indus-trial

materials.(25)

100373550338329

337

339357369373

All com-modities.

(45)

10035751C345327

326

329337352362

GROUP INDEX NUMBERS—GERMANY—FEDERAL STATISTICAL BUREAU.

1913 average1919 average1920 average1921 average1922average

1921.December

Goodsproduced.

(16)

Goods All corn-imported, modities.

(22) 1 (38)

100385

1,253 i1,786

29,655

3,170 I

100558

2,6522,533

56,818

5,071

100416

1,4861,911

34,182

3,487

Year and month.

1922.JuneJulyAugustSeptemberOctoberNovemberDecember

Goodsproduced.

(16)

6,5409,300

16,54525,81549,85395,290

128,330

Goodsimported.

(22)

9,47913,85432,49143,11390,343

214,150243,230

All com-modities.

(38)

7,03010,05919,20228,69856,601

115,100147,430


JANCARX, 1923 . FEDERAL RESERVE BULLETIN. 85

GROUP INDEX NUMBERS—GERMANY—FRANKFURTER ZEITUNG.

Year and month.'

July,1914January, 1920..January, 1921.

JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember.OctoberNor ember..December..

1922.

January.1923.

1 Beginning of month—not always the 1st.

GROUP INDEX NUMBERS—ITALY—RICCARDO BACHI.

Foodstuffsand

luxuries.(26)

1001,9722,019

3,8404,3005,2116,3306,6496,9678,323

13,69129,17538,59588,980

144,753

175,845

Textileand

leather.(16)

1003,4073,840

7,1687,7228,4928,5519,2289,626

11,001.19,66132,18466,157

153,896266,622

320,632

Minerals.

(18)

1002,7492,780

5,1785,5256,8108,5859,305

10,14112,16818,35542,64854,905

128,982219,395

262,212

Miscella-neous.

(17)

1001,1011,776

3,1493,4924,2015,2885,9616,4136,881

10,99321,60532,13472,038

134,177

177,752

Industrialfinished

products.<2l)

1001,4651,704

3,3473,5814,0604,9725,9826,3417,292

10,00122,66435,02557,683

118,385

151,793

All com-modities.

(98)

1001,9652,130

4,2174,5995,42C6,7037,3847,8519,102

13,97829,11643,22394,492

166,495

205,417

Vegetable Animalfoods. ! foods.

January...SeptemberOctoberNovemberDecember

GROUP INDEX NUMBERS—SWEDEN—GJJTEBORGS HANDELS OCH SJOFARTSTIDNING.

[July 1,1913-June 30,1914=100.1

Year and month.

1913-14.1919....1920....1921. . . .

November.1921.

AugustSeptember.October.. .November.

1922.

foods

(16)

100261262210

161

168146143132

Animalfoods.

(7)

100409296220

196

168179166171

Raw ma-terials

for agri-culture.

(5)

100340312227

197

162160158159

Coal. Metals.

(2)

Hidesand

leather.

(5)

100804

1.007285

194

16716916!)175

GROUP INDEX NUMBERS—CANADA—DEPARTMENT OF LABOR.

Textiles.! Oils. All com-modities.

100•an215107

108

90909189

(5)

100

324144

149

170171176194

(2)

100

294228

179

154150150150

(47)

100330347211

174

163158155151

Year and month.

1913191919201921

1921.November...

1922.AugustSeptember...OctoberNovemberDecember.

er I

Grainsand

fodder.

(15)

100227263150

125

130121119126127

Animalsand

meats.

(17)

100199198149

113

138132131125127

Dairyprod-ucts.

100192204157

158

120 i128141152160

Fruitsand

vege-tables.

(20)

100206261172

176

159137139155159

Otherfoods.

(25)

100222258181

158

152156153153153

Textiles.

(20)

100285303189

179

181181183185182

Hides,leather,

etc.

(11)

100213192110

100

105105103106102

Metals.

(23)

100173203150

140

142144 I146147 i148 I

Imple-ments .

(10)

100228245240

232

21621821821S218

Build-ing ma- J Fuel andterials, lighting,

lumber.(14)

100171268211

180|

179 I179180181 !184

(10)

\00201255218

211

257243232221225

Drugsand

chemi-cals.(16)

100205204177

165

161160158160160

Allcom-modi-ties.(264)

100217246182

168

16416S1CJ164165


86 FEDERAL EESEBVE BULLETIN. JANUARY, 1923.

COMPARATIVE RETAIL PRICES IN PRINCIPAL COUNTRIES.

In the following table are presented statistics showing the trend of retail prices and thecost of living in the United States and certain other countries:

INDEX NUMBERS OF RETAIL PRICES AND COST OP LIVING.

Year andmonth.

Retail prices.

n e d !States, ada.

1914.19201921

1921.SeptemberOctoberNovemberDecember

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember jOctoberNovemberDecember

France' Tfn,_|(Paris).:Ilal5-

3 100199150

|150 j150149 I147

139139 !136 ;136136138 !139 I136 :137140 <142 .144 .

100 .215 !.164 .

3 100 |

1,428159155 .149 j14S '

149 j143 !142 !133 i13S !137 ;138 I141 i139138

1,4671,4611,4141,4151,4441,4751,4301,2901,1051.010984

Cost of living.

329 I 542331 I 581326323

319307294304317307297289291290297305

S7f>559546524539

531

190189185182178179179181ISO178170

66,90077,00077,80087,200109,300197,100264,500593,200

1,130,6001,033,200

41S394372308365373372369384706

1,6401,9S92,3023,1753.4623,7794,9907,02911,37619,50440,04761,156

46,88348,08552,35858,62763,91468,40678,79890,823107,663128,418

1,9032,1772,7403,1773,4554,1496,12210,27116,36826,06956,49786,785

1 Average for the month.'Average for 1913.

3 July.<Apr. 15,1914= 100.

'» 1913-1914-100.•August, 1913-July, 1914= 100.

* June.8 1909-1913=100.

Retailprices.—The American index number, constructedby the Bureau of Labor Statistics, was based upon the retailprices of 22 articles of food, weighted according to familyconsumption, until January, 1921, when it was increasedto 43 articles reported by dealers in 51 important cities.The method of weighting continues the same, although theactual "weight" applied has been changed. The originalbasis, thart of the year 1913, has been shifted to July, 1914.

The index number for Czechoslovakia is based on theretail prices of 23 commodities including foodstuffs, fuel,petroleum, and soap.

The retail price index for Paris, compiled by the FrenchGeneral Statistical Office, consists of retail prices of 13 dif-ferent commodities, weighted according to the averageannual consumption of a workingmans family of fourpersons. Eleven of the commodities included in this in-dex are foods, and the other two are kerosene and alcohol.

The Italian retail price index for the most importantcities, computed by the Italian Ministry of Labor, consistsof retail prices of 21 commodities. Of the commodities in-cluded, 20 are foods and the other commodity is charcoal.

The Swedish index number consists of the retail pricesof foodstuffs, fuel, and lighting and is based upon theprices of 51 articles in 44 towns (in 1920, 50 articles in 49towns), weighted according to the budget of a working-man's family which before the war had a yearly incomeof 2,000 kronor.

Cost of living.—The Austrian index, computed by theParitatische Kommission, includes food, clothing, fuel,lighting, and rent. Prices, collected from cooperative asso-ciations and firms, are those ruling on Vienna markets. Anaverage is obtained for each article and weighted accordingto the theoretical weekly expenditure oi a normal person.

The Belgian index number of cost of living, constructedby the Ministry of Labor, consists of the retail prices of 30commodities, weighted according to a standard budgetbased on an inquiry into the expenditures of 848 familiesof the laboring and small middle classes.

The German cost of living index for 46 cities is furnishedby the Federal Statistical Bureau and includes food, fuel,light, and rent.

The Berlin index, computed by Dr. R. Kuczynski, isbased on the minimum cost of subsistence for a working-class family of four persons in Berlin. The groups in-cluded in the budget are food, clothing, heating, lighting,and rent.

The Polish Central Statistical Office furnishes an indexincluding food, clothing, heating, lighting, rent, and mis-cellaneous expenditures. Official prices are used forState-controlled goods, but when the official ration is lessthan a standard budget the balance is reckoned at thetrade price. The system of weighting is according to atheoretical budget for a working-class family of fourpersons in Warsaw.

The Swiss index number, computed by the socialstatistics service of the Bureau of Labor, is based on aninvestigation into household budgets made in 1920, andrefers to about one-third of the entire cost of living of thefamily of a skilled worker.

The British index number of the cost of living, con-structed by the Ministry of Labor, consists of the retailprices not only of foodstuffs, but of other articles as well.Retail clothing prices, rents, and the cost of fuel, lighting,and miscellaneous household items are also taken into con-sideration. The index number is weighted according tothe importance of the items in the budgets of working-class families.

The Indian index, including food, clothing, heating,lighting, and rent, is computed by the labor office secre-tariat. Prices are collected twice a week from 10 retailersin Bombay. The index is weighted according to theaverage aggregate expenditure of the whole of India duringfive years before the war.

The index number for New Zealand includes food, rent,fuel, and lighting. It is computed by the census andstatistics office, on the basis of average annual aggregateexpenditure, in four chief centers, 1909-1913.

The South African index, computed by the Office ofCensus and Statistics, includes food, heating, lighting, andrent. Until December, 1919, it was weighted according toa standard budget, but since then the aggregate expendi-ture method has been adopted.


JANUARY, 1923. FEDERAL RESERVE BUIJJETIN. 87

INDEXES OF INDUSTRIAL ACTIVITY IN FOREIGN COUNTRIES.UNITED KINGDOM.

Year and month.

Monthly average:191319201921

1921.OctoberNovemberDecember

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovember ,

PRODUCTION.

Coal.

Longtons

(000).23,95319,10813,696

' 21,09017,875

3 22,594

17,69319,76419,921

522,87519,14615,82723,13519,151

325,68121,20721,712

.Pigiron*

Longtons

(000).855670218

236272275

288300390394408369399412430482

Steelingotsandcast-ings.

Longtons

{000).639756302

405444381

328419549404462400473528556565

Fin-ishedsteel.

Longtons

(000).

646238

304330292

271321369294334316345338363

j fac-i tures.

Bales(000).

1,3971,234

1,1231,2161,271

1,2981,2401,1121,1811,1431,111

890864853882

1,056

Longtons

(000).414271142

156194205

253224296258272236252270279347372

Cottonmanu-

fac-tures.

Sq. yds.(000,000)

'596374244

345366333

342254307305345315447381400357402

Coal. Raw Rawwool. I

Rawwet

hides.

Hides,dry

d

Vesselsunder

-, con-ana ciriip

«"*»•! ton0."

Long |tons i Found:

(000). 1(000,000) (000,000)\ (000).6,117 j 181 67 i 6,9272,078 ' 158 73 ; 4,025 j 6', 2772,055 ; 98 i 63 ' 4,792 [ 2.469

Pounds 'Pounds \Pounds !(000).

3,4063,5944,309 i

733 !195 !186 ;

4,0214,0145,2014,0975,0574,7945,0646,1467,0836,1965,671

1349983

1011201271118160

128183

i Grosstons.(000).2,0033 6033,313

901121231171389779107526060

6,4078,9677,875

4.55712; 1844,5683,1642,9942,7727,3907,2817,3395,0905,550

4,226 i4,504 j3, 800 2,640

4,18812,8824,1023,5902,4713,3932,9824,4223,6166,5715,469

2,236

1,920

1,617

[NO.'

Vesselsleared.

Tons(000).5,6523 0493,032

4,0563,9444,003

3,9193,8914,8144,1875,1044,9754,8285,8555,7315,5905,653

Unem-ployedamongapprox-imately12,000,-000 in-sured

persons.

Percent.

12.815.716.2

16.215.214.614.413.512.712.312.012.012.012.4

1 Figures for end of the month. * Expressed in yards. 3 Figures for 5 weeks.

FRANCE.

Year and month.


PRODUCTION.

Seel!

Metric Metrictons (000). tons (000).\

OctoberNovember.December..

1921.

January...February..MarchAprilMayJuneJulyAugustSeptember.OctoberNovember..

1922.

<434286280

256295301

312323

442416428447482503

<391254255

260277302

315317367324364358369397407430

Cottonstocks

atHavre.1

Bales«(000).

274225169

TRANSPORTATION.

Total. Total.j Raw I Rawjcotton for 1 silk fori consump-. consump-

tion, tion.

Metrictons (000).

1,8401,0711,333

181192208

112

252515507

188163127138169145 j153135 I99

131158

1,5541,5201,5701,7941,5381,7991,9361,7882,6162,0342,034

Metrictons (000).

3,6854,2113,165

2,8095,1615,197

3,3964,1264,4343,7874,3964,3074,2234,5124,1384,5434,577

Metrictons.

27,42819,57716,666

25,75729,05930,835

14,87014,71420,97817,39118,09032,38026,32516,29117,302 I27,877

Metrictoni.

029390206

Coal forconsump-

tion.Vessels

385277382

502467408207404391566579550722

1,3013,2912,895

1,6762,1532,0811,5382,0581,8291,631 i1.767 !1,692 ;1.768 !

Receiptsof

cleared, i principal•railways.2

Unem-ployed

receivingimnnicipal

aid inParis.

Metric JIons (000). 1

1,558 I2,0051^472 !

Tons(000).

2,176 j1,4121,802 i

2,007 i1,862 ;1,992 i

1,7351,7441,9342,0882,3402,4732,5232,3992,3592,336

Francs(000).

'-165,892479,894516,397

483,216641,887

454,323468,175472,779608,764472,607504,431651,720546,310720,210563,314532,152

Number.

3,02220,671

5,3483,7304,175

4,6584,3853,5462,4471,636

958602606410272285

1 End of the month figure.» Railways included are: State Railways, Paris-Lyon-M&literranê, Nord, Orfeans, Est, Midi, Alsace-Lorraine, and GuiUaume-Luxembourg.«Bale of 50 kilograms.< Figures do not include Lorraine.' Excludes the Alsace-Lorraine and Guillaume-Luxembourg Railways.


88 FEDERAL EESEKVE BULLETIN. JANUARY, 1923.

Year and month.

Monthly average:1913 . . . .19201921..

1921.October.NovemberDecember

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctober

PEODUCTION.

Coaland

coke.

Metrictons

(000).17 00313,04313 664

14 37314 05214 343

14,64013,65515,93113, 80014,07011,41611 97212,7S012,623

'13,329

Lignite.

Metrictons

(000).7 2669,303

10,241

10 56710 47911 029

10,97810,09112,26010,63411,43710,48711 41112,14711,82312,078

Ironandiron

manu-factures.

—

Metrictons.

541,439145,883203 681

246 115233 204214 812

221,743172,709211,979200,677209,432213,220212,365198,408244,012246,074

EXPORTS.1

Ma-chinery

andelec-tricalsup-plies.

Metrictons.

60 919546 77239 037

33 06735 69746 397

39,47045,68948,81346.11247,35449,34744,16250,97840,15050,699

Dyesanddye-

stuffs.

Metrictons.

2!, 8128,4628 530

10 2559 9539,212

9, 5529,332

12, 29911,09512,62916,33512,67112,61613,47715,187

GERMANY.

Coal.> E a w

Metric Metrictons. tons.

2,881,126 16,60860S; 749 » 4,025518,937 11,860

570,048 12,506569,657 12,628640,877 ! 10,984

752,340 10,400609,433 26,202795,200 25,9S8795,940 24,091701,941 25,619528,766 : 15,723199,961 i 14,119121,359 i 11,011110,245 ' 8,708125.670 i 10,023

IMPORTS.1

Halfmanu-

fac-turedsilk.

Metrictons.

9205 232

393

77434638S

3473834404624864364354593!2371

Cot-ton.3

MetricIons.

43,42412,49030, 894

29,73927,24228,313

23, 42017,91526, l;)024,07026,11222,03728,08520,91513.95910,584

Iron

Metrictons

(000).1,225

538019

920937791

942493810863

1,5191,159

962997

1,0901,310

SHIPPING.

Arrivals ofvessels inHamburg.

Number.1,256

401700

915838503

745461894072

1,1431,092

7931,005

9451,016

Tons(000).1,182

374794

1 047881873

875716969

1,1121,2441,2871,0651,1711.2081,272

UNEMPLOY-MENT.

Appli-cants

forevery

100avail-ableposi-tions.

Number.

109165

128136148

150145113113107103106109122

Unem-ployedpersonsreceiv-ing

Stateaid.

Nuvib<r(000).

36631C

186150149

165203213116652920!51216

1 Export and import figures for first 4 months of 1921 not available; 1921 averages based on 8 months.« Not including coal for reparations account.' Includes linters.< Includes manganese ore.* Average based on 6 months.• Coal, excluding coke.

Year and month.



1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctober.

PRODUCTION.

PigIron.

Metric tons(000).

613926

161819

18172219242120222223

Iron andsteel ingots.

Metric torn(000).

493717

IS2217

13172221312427273131

SWEDEN.

EXPORTS. IMPORTS.

(Jnplanedboards.

Cubicmeters (000).

328306162

370361356

8725636699

500608539508494

Paper r ,pulp. C o a l -

Metric tons Metric tons(000). (000).

71 40873 23440 122

144 21954 19299 : 246

104

28 ! 11411 6236 19721 20676 23080 17289 ; 214

104 294113 229144 •. 270

TRANSPORTATION.

Vesselsentered.

Net tons(000).

1,147677519

670601575

442285617524600596625694684660

Vesselscleared.

Net tons(000).

1,147692482

595578582

409255509485633738787836808774

Freightcarried

on Staterailways.

Metric tons(000).

830991589

691721558

485630730622578645715765776

Unem-ployed

workmenper 100

vacancies.

Number.112107276

263384473

4824793813G8257215203172155177


JANDART, 1923 . FEDERAL KESEKVE BULLETIN. 89

JAPAN.

PRODUCTION.

Year and month.

rilys19J3-.1920.1921.

I Cottonyarns.

Bales(000).

126151

1921.SeptemberOctoberNovemberDecember

1922.JanuaryFebruaryMarchAprilMayJuneJuly ,AugustSeptember

151

149159168178

168174184191134192

m179179

Silkfabrics(habu-taye).

HiU i(000).

149

136145170

Paper.

Pounds(000).

44,538

45,55945,96945,658

169 48J781

166129153110160173159116121

46.4S846,60549,64452,68753,97552,79153,73454,55353,326

Rawsilk

stocks,Yoko-hamamar-ket.

Bales.

53,11158,477

59,45053,53548,83244,766

40,56132,21344,70140,77718,29318,54745,84856,03248,810

Silk,raw.

16,85714,55721, S36

22,56324,00629,18937,250

16,92418,10216,64727,38035,14729,56934,54136,19635,959

Silkfabrics(habu-taye).

Piculs.2,3022,2641,702

1,6321,2531,8551,857

Cottonyarns.

Piculs.113,37474,83973,064

36,99653,50653,48468,032

1,0801,5512,0031,6691,9772,1761,7932,0171,686

61,41463,719123,605138,226146,354139,05751,66040,07568,773

TRANSPORTATION.

19,12424,99024,19424,72525,82129,71325,28422,34317,668

41,72493,41164,86576,41624,75368,41537,43129,93617,559

Ironplatesand

sheets.

Piculs(000).

132528312

101218290371

637582890872697351

Vesselscleared

inforeigntrade.

Tons(000).2,0752,2162,324

2,3282,4912,6112,713

2,7492,8173,0942,9713,2873,0242,9873,1192,849

Freight

on

âU-"ways.

Tons(000).2,9234,5484,342

4,2864,6254,6104,922

4,1024,2615,0664,9685,2254,9654,6414,4894,502

ways.

Yen(000).11,72327,58931,182

30,58034,96031,72932,520

28,57628,03636,33742,07438,48632,18032,97733,94432,464

1 One hUri equals two pieces. 2 A picul varies from 133 to 140 pounds avoirdupois.

FOREIGN TRADE OF PRINCIPAL COUNTRIES.

In the following tables are presented figures from official sources showing the monthly valueof the foreign trade of a group of European countries, Canada, Brazil, India, Japan, and theUnited States.

FOREIGN TRADE OF UNITED KINGDOM.

[In thousands of pounds sterling.]

Year and month. Food,drink,and

tobacco.

Monthly average: I1913 1 24,1811920 63,8171921 47,271

November.December..

1921.

JanuaryFebruary. .MarchAprilMayJuneJulyAugustSeptember.October . . . .November..

1922.

41,24139,063

33,97232,25745,26140,09743,07539,93638,81737.76235,55538,61745,501

Rawmate-

rials andarticlesmainly

unmanu-factured.

23,48559,19622,598

29,94627,792

24,56520,22022,09521,40125,35825,24224,23724,14121,84826,40930,223

Articleswholly

ormainlymanu-

factured .

16,13437,78720,421

17,91318,291

Miscel-laneous,includ-

ingparcelpost.

17,71016,57620,30918,96220,20718,85718,57920,32619,24419,72619,587

I

259254268

154165

241322215199176263151432296262

Total.

64,061161,38790,557

89,25985,312

76,48869,37587,87980,66188,81484,29881,78482,66176,94485,01595,600

Food,drink,

andtobacco.

Rawmate-

rials andarticlesmainly

unmanufactured.

Articleswholly

ormainlymanu-

factured.

2,7164,2453,122

3,5863,187

2,8612,7543,2703,0113,0453,0442,8063,1053,1543,0663,407

5,82512,1265,297

7,0467,4*0

7,0326,8698,4657,3768,7577,6718,0418,900

10,0999,211

10,101

34,28193,31349,055

51,09447,364

51,82448,00051,76044,33645,07340,55648,45547,14948,36147,01051,964

Miscel-laneous,includ-

ingparcelpost.

9491,5231,126

1,1691,378

1,429712

1,085785

1,171875

1,117878897

1,1121,018

Total.

43,770111,20658,600

62,89559,375

83,14758,33564,58155,50853,04552,14660,41960,03262,51160,39966,491

Reex-ports.

9,13118,5638,921

9,8239,204

8,45910,17410,1549,2008,9658,7208,3177,5046,3818,2779,148

Totalexport!

andreex-ports.

52,901129,76967,521

72,71868,579

71,60868,50974,73564,70867,01860,86698,73867,53668,89J68,67875,639


90 FEDERAL RESERVE BULLETIN. JANOABY, 1923.

FOREIGN TRADE OF FRANCE.1

Year and month.

Monthly average:19131920 v1921

1921 .*NovemberDecember

1922.»J»nuaryFebruaryMarch

fc::::::::::June*JulyAugustSeptemberOctoberNovember

In thousands of francs.

Food.

151,465989,576•517,15S

564,012754,671

352,572385,021460,765438,000504,000483,356476,813510,597473,000570,000517,000

Rawmate-rials.

412,1442,096,3791,033,170

1,446,1251,856,148

887,2531,137,8551,005,463

983,000996,000

1,082,3711,200,7641,096,9031,087,0001,190,0001,478,000

Manufac-tured

articles.

138,1691,072,787

412,045

323,593543,445

247,827324,160465,737323,000310,000285,448318,169352,229333,000349,000353,000

Total.

701,7784,158,7411,962,373

2,333,7303,154,264

1,487,6521,847,0261,931,9651,743,6401,810,1251,851,1841,995,7461,959,7291,893,0002,109,0002,348,000

Inthou-

sands ofmetrictons.

3,6854,2113,165

5,1615,197

4,1264,4343,7874,3964,3074,2234,5124,1384,5434,577

In thousands of francs.

Food.

217,733161,031

157,180259,605

121,526153,892130,595136,000132,000

113,435179,407141,000195,000196,000

Rawmate-rials.

154,841509,485463,219

478,875549,495

458,460448,455456,930461,000498,000

374,959408,005477,000494,000537,000

Manufac-tured

articles.

301,4211,413,5481,067,413

992,2561,193,181

994,8521,106,5071,189,7121,231,0001,127,000

885,029931,066

1,055,0001,099,000

856,000

Parcelpost.

47,182100,479104,430

120,343180,059

63,903144,45899,431134,000111,000

59,619157,83668,000149,000117,000

Total.

Inthou-

sands ofmetrictons.

573,S512,241,2451,796,092

1,748,6542,182,320

,638,741,853,312,876,688,962,997,886,964

,433,042,676,000,741,0001,937,0001,706,000

l,S401,0711,333

1,5162,507

1,5641,5201,5701,7941,5381,7991,93*1.7882,6162,0342.0S4

1 Not including reexport trade.' Calculated on 1919 value units.

' Imports calculated on basis of actual declared value.' Value of exports not available. Beginning with June, exports calculated on 1921 value units.

FOREIGN TRADE OF GERMANY.

Year and month.

Monthly average:191319201921'

OctoberNovember.,December..

1921.

JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember.OctoberNovember..

1922.

IMPORTS.'

Gold andsilver (Inthousandsof marks).

36,653

17,756

60,6935,3124,922

132,33646,4097,566

12,31531,91018,01837,21539,445

131,40999,050

Merchandise.

In millionsof marks.

890

In thou-sands of

metric tons

13,81412,27313,702

12,64112,00122,91928,26632,4] 734,36445,74856,472

«422«532<536

6,0731,5702,194

3,0*52,5352,086

2,3091,4752,6452,8893,8104,0294,7984,6764,8295,5524,551

EXTOBTS.'

Gold andsilver (Inthousandsof marks).

8,45017,77334,901

30,01344,07386,227

134,05457,42546,89851,45175,844

109,298124,178152,906297,335296,609

Merchandise.

In millionsof marks.

In thou-sands of

metric tons.

8415,7768,295

9,68111,88614,468

14,39414,48221,28522,94827,08030,23236,70860,295

<291«290•255

6,1411,6511,716

1,9731,9081,930

2,0271,7472,1532,1762,0931,8801,6361,4071,5871,5391,551

1 Not Including philanthropic gifts.' Not including deliveries on reparations account.

* Average for 8 months. Figures covering first 4 months of 1921 are not available.( I n gold marks.

NOTE.—Currencies have not been converted to a common unit, nor are methods of valuation the same in all coun-tries. In England, Sweden, India, Japan, and Brazil imports are given c. i. f. values; exports and reexports currentf. o. b. values. In France and Germany the value of foreign trade is estimated not in terms of current prices, but interms of those of some earlier period, usually the preceding year. Danish imports and exports are official valuationsdetermined annually by the Central Bureau of Statistics. In the Netherlands imports are given in declared valuesfor about 110 articles of the import schedule. In other cases official valuations are applied to both imports andexports. Canadian imports and exports are quoted at the fair market value, at the point of origin. In the UnitedStates imports represent either actual foreign market value or the export value, including any export tax imposed bythe country of exportation, whichever is higher; exports are expressed in terms of their value at the time of exporta-tion, with the exception of reexports from bonded warehouses, which are expressed in their import value.


JANUARY, 1923. FEDERAL, RESERVE BULLETIN. 91

FOREIGN TRADE OF DENMARK, NETHERLANDS, SWEDEN, CANADA, BRAZIL, INDIA, AND JAPAN.

Year and month.


1921.September..OctoberNovemberDecember

1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctober

Denmark.(In millions of

kroner.)

Im-ports.

71262136

137143143155

10270

103126159140117134134118

Ex-ports.

60151121

124113102107

8076

10076

10812510190

121112

Netherlands.(In millions of

guilders.)

Im-ports.

%«187

197179178180

152153180167194151164179165187

Ex-ports.

m142114

13611510797

8686

11393

108101105100128124

Sweden.(In millions of

kronor.)

Im-ports.

71281106

12610195

112

7749

109102979383

105109118

Ex-ports.

6819191

10599

103108

6138716090

104113132123122

Canada.(In millions of

dollars.)

Im-ports.

5689

103

63606460

51547948666261676067

Ex-ports.

31107101

60818887

474761337073727473

104

Brazil.(In millions of

milreis.)

Im-ports.

84174141

10111296

113

92101131127127129109147133

Ex-ports.

82146142

1S3166155175

1991611721871411491541S2202

India.(In minions of

rupees.)

Im-ports.

134173280

197235264232

276189215178191164182212182235

Ex-ports.

205272214

200182199218

230222277239273192244252216182

Japan.(In millions of

yen.)

Im-ports.

61195135

129130152161

179198208185169157142137135105

Ex-ports.

53162104

96112121146

87101115129154146144146150161

1 Italian yearly figures for 1921 based on average for six months only.1 Dutch figures for 1913 not comparable with later figures.

FOREIGN TRADE OF UNITED STATES.


Year and month.

Monthly average:

1920'.'.'.'.'.'.'.'.'.'.'.'.'.1921


1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember'October*November*

IMPORTS.

Gold. Silver.

5,30934,75657,606

51,86031,685

26,57128,70133,48812,2448,994

12,96942,98719,09224,46420,86618,308

2, ,7,338146,5270

5,9125,516

6,4964,7716,9534,8005,5126,3466,9574,944 Hoi6,3703,9405,855

Merchandise.

Crudemate-rialsfor

use inmanu-factur-

ing.

50,414.45,99571,090

70,03994,016

82,63980,97186,91069,80488,08891,14687,298110,28586,818

Food-stuffs

incrudecondi-tionandfoodani-

mals.

18,39918,13625,331

16,52948,136103,178— — 30 737

29,33832,707

27,49822,37028,75625,71131,26426,17027,59622,48918,769

Food-stuffs

partlyor

whollymanu-

fac-tured.

26,20525,473

25,90027,76236,01432 48234,78537,34638,51142,40424,023

Manu-fac-

turesfor

furtheruse inmanu-factur-

ing.

28,35166,87128,669

30,39832,083

30,27234,04142,82037,25239,39846,47148,39848,13041,026

Manu-fac-

turesready

forcon-

sump-tion.

34,45373,06051,877

53,36551,171

49,81149,37559,88050,82058,25458,43949,16455,85851,038

Totalmer-

chan-dise.!

149,383439,873209,085

211,027237,373

217,185215,743256,178217,023252,817260,461251,772281,376'298,000319,000

Gold.

7,65026,841

1,991

6072,162

1,732963

1,5793,4071,601

645956

1,39917,5923,431

Silver.

5,2319,4681551,298

4,8047,145

Merchandise.

Crudemate-rialsfor

use inmanu-factur-

ing.

64,07255,89782,002

88,54589,950

3,9777,0924,3025,1095,6776,0046,2893,8613,7353,269133;6,599144,329

72,83855,89573,00179,51164,44170,21960,02447,87266,619~V03

Food-stuffs

incrudecondi-

tionandfoodani-

mals.

14,13276,49957,681

30,05228,737

31,05427,79934,50731,17434,14341,00041,95861,33955,14240,79833,615

Food-stuffs

partlyor

whollymanu-

fac-tured.

27,06993,05055,809

41,44938,282

43,01945,16458,89947,37250,37655,48549,22646,07143,23117,91951,471

Manu-fac-

turesfor

furtheruse inmanu-factur-

ing.

33,07779,87533,323

33,26035,145

35,14332,19343,63237,96940,46739,08635,67635,70835,66632,94333,593

Manu-fac-

turesready

forcon-

sump-tion.

64,998267,071135,450

95,53898,370

91,81084,684112,765113,876112,112121,284109,544104,871106,542110,177110,532

Totalmer-

chan-dise.*

207,002685,068373,760

294,437296,306

278,898250,748330,267318,100307.689334,684301,311301,804313,092370,720380,053

1 Including miscellaneous merchandise imported.1 Including miscellaneous and foreign merchandise exported.'Imports under old tariff law September 1-21,1922, only.' Impor t figures delayed owing to change in tariff.s Complete September figure.


92 FEDERAL RESEKVE BULLETIN. JANUARY, 1923.

FOREIGN TRADE INDEX.

There are presented below the usual indexesdesigned to reflect the movements in foreigntrade of the United States, with the fluctua-tions due to price changes eliminated. Delayin receiving import figures, due to the newtariff provisions, makes it necessary to omitthe index of import trade in October andNovember.

INDEX OF VALUE OF FOREIGN TRADE IN SELECTEDCOMMODITIES AT 1913 PRICES.i

1913, year. .1919, year..1920, year..1921, year..

1921.JanuaryFebruary..MarchAprilMayJuneJulyAugustSeptember.OctoberNovember.December..

1922.JanuaryFebruary..MarchApril. . . .MayJuneJulyAugustSeptember.OctoberNovember.

[Monthly average values

Exports.

Rawmate-rials(12

com-'modi-

ties).

100.088.992.2

103.1

105.291.078.276.597.6

107.9111.6142.7115.7121.795.193.8

82.668.589. S90.578.386.379.188.891.2

122.9112.6

Pro-duc-ers

goods(10

com-modi-ties).

100.0155.1158.7116.9

208.0162.4135.1132.596.494.278.699.689.7

107.0100.296.0

104.386.0

121.7120.9128.8124.3124.090.098.996.8

101.6

Con-sum-ers'

goods

com-modi-ties).

100.0183.6133.61241

126.2119.4120.2116.4110.8132.2133.8160.7142.3113.2106.2107.8

129.7127.6156.5150.5155 4169.2133.5126.3111.5121.0117.2

Total(29

com-modi-ties).

100.0115.3107.5108.9

120.2104.192.790.5

100.3111.5112.9142.1118.6118.498.196.9

94.582.6

106.9106.099.4

107.495.096.796.2

119.8112.4

, 1913-100.1

Rawmate-rials

(10com-modi-

ties).

100.0157.5135. 8113.6

74.5118.2160.6153.398.794.599.3

116.8102.896.1

115.1133.0

118.4123.3148.1125.5144.6148.7146.9174 2143.3

Imports.

Pro-duc-ers'

goods(12

com-modi-ties).

100.0192.9227.5162.8

130.9143.7177.2177.6150.0152.3126.6165.1137.7173.5199.4219.1

228.7281.3306.8236.1227 9273.3266.3255.5182.7

Con-sum-ers

goods(5

com-modi-ties).

100.0147.5138.8141.4

123.9135.4178.9185.1162.1130.4121.4129.899.3

116.5149.2164.8

135.2133.5161.1152.0168 0137.3137.5120.390.6

Total(27

com-modi-ties).

100.0168.4168.8135.6

102.6130.1169.5167.1127.2120.8112.6136.0114.6126.9150.6168.7

160.1183.4206.5169.1177.9191.0187.7194.2148.6

1 The list includes 27 of the most important imports the value of whichin 1913 formed 49.3 per cent of the total import values, and 29 of the mostimportant exports the value of which in 1913 formed 56.3 per cent of thetotal export val ues. The classification of the original list of commoditiesused was given in the July, 1920, BULLETIN. The classification of 11additional commodities of imports was given in the April, 1921, BULLE-TIN, and 2 additional commodities in the November, 1921, BULLETIN.Exports of gasoline have been altered to include naphtha.

The index of the volume of exports forNovember showed a decrease of 8 points or6 per cent from the October figure. Notwith-standing this decrease, the November level of112.4 is still higher than in*any other month of1922 with the exception of October. Theexport volume of raw materials and consumers'goods decreased, while that of producers' goodsincreased.

Among raw materials there was a declinein the exports of wheat of 42 per cent and inleaf tobacco of 32 per cent. Corn, oats, andbarley also showed decreases. Cotton exportscontinued to increase.

The rise in the producers' goods index wascaused by increases in the exports of steel andcopper products, and of cottonseed oil.

Exports of refined sugar continued to fall.The November figure was 8,707,000 poundsin contrast to 368,000,000 pounds in June,1922. Other commodities which fell are cottoncloths, boots and shoes, lard, and illuminatingoil.

SAVINGS DEPOSITS.

Comparison of savings deposits on December1,1922, with deposits on November 1,1922, andDecember 1, 1921, are shown for 885 banks dis-tributed throughout all sections of the UnitedStates. The figures for the Boston and NewYork districts are those of large mutual savingsbanks, but in all other districts reports of otherbanks are included to make the figures thor-oughly representative. In all districts wherereporting commercial banks subdivide theirtime deposits, statistics of sayings deposits sub-ject to notice (excluding time certificates ofdeposit) are used. This is in accordance withthe definition given in the Federal ReserveBoard's Regulation D, series of 1920.

Volume of savings increased during Novem-ber in all Federal reserve districts except No.3 (Philadelphia) and No. 5 (Richmond). Themost important gain was registered in districtNo. 8 (St. Louis) and amounted to 2.1 per cent.During the year ending December 1, the volumeof savings deposits increased in all Federal re-serve districts, increases ranging from 2.3 percent in district No. 3 (Philadelphia) to 14.3 percent in district No. 11 (Dallas).

SAVINGS DEPOSITS.

[000 omitted.]

District.

BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan Francisco

Total

Numberof banks.

643080189379

219351561

11675

885

Dec 1,1922. Nov. 1,1922.

1,116,5461.746,127

419,046393,214276,936157,669805,640120,58981,24695,43973,196

796,128

6,081,776

1,114,4121,741,543

419,573389,013278,077157,417795,280118,05880,89193,66272,743

789,559

6,050,228

Dec 1,1921.

1,061,1061,656,392

409,464377,166249,300146,935770,989106,55176,16885,51764,023

712,653

5,716,264


JANUARY, 1923. FEDERAL RESERVE BTTT.T.KTTTT. 93

REPORT OF ASSOCIATED KNIT UNDER-WEAR MANUFACTURERS OF AMERICA.

The total production of winter and summerunderwear for November is compared withprevious months in the following table:

1922.JuneJulyAugustSeptemberOctoberNovemberWinter underwear (November).Summer underwear (November)

Numberof report-ing mills.

Actualproduction(in dozens).

564,893422,872519,511513,572524,486599,891321,944277,947

Order and production report for the monthended November 30, 1922, follows. The num-ber of reporting mills was 41.

Unfilled orders first of month 1,193,149

New orders received during month 632,824

Total (A) 1, 825, 973

Shipments during month 391, 920

Cancellations during month 9, 022

Total (B) 400, 942

Balance orders on hand Dec. 1 (A-B) 1, 425, 031

Production 461, 275

Thirty-three representative mills which re-ported for October and November, 1922, fur-nish the data for the following table:

[In dozens.]

! October. ! November.! Gain.

Unfilled orders end ofmonth 1,127,190

Neworders 591,962 iShipments 308,363Cancellations 5,552Production 359,752

Loss.

1,351,480 , 224,290569,630 I . . . . . j 22,332337,650: 29,287

7,690 i 2,138408,955 49,203 '

INDEX OF OCEAN FREIGHT RATES.

The accompanying table shows the monthlyfluctuations in ocean freight rates prevailingbetween United States Atlantic ports and theprincipal European trade regions. The figures

are derived from the actual rates quoted onthe following commodities: Grain, provisions,cotton, cottonseed oil, and sack flour. Forthe methods used in constructing the indexsee the August, 1921, BULLETIN, pages 931-934.

RELATIVE OCEAN FREIGHT RATES IN UNITED STATES ANDEUROPE TRADE.

[January, 1920, rates-100.]

United States Atlantic ports to—

Month. UnitedKing-dom.

Nether-French lands Scandi-

Atlantic.l and j navla.Belgium.!

1921.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovember !December i

1922. iJanuary '>February !MarchApril jMayJune ;July !August jSeptember \OctoberNovember iDecember j

60.754.749.350.150.642.742.542.941.837.033.532.4

31.734.733.127.327.927.528.829.227.025.328.027.1

Medl-

30.227.7 i24. e i32.635.034.7 I33.2 I33.4 '32.728.525.022.7

22.725.726.524.825.526.125.923.424.123.923.425.6

34.129.228.336.638.238.337.036.735.830.725.222.9

23.325.224.922.7 j22.8 '23.022.620.719.118.921.3 i22.2

42.930.930.829.431.331.329.028.428.226.724.023.3

23.423.323.424.023.423.423.022.4 !22.622.922.922.7

AllEurope.

43.243.842.235.734.634.034.734.333.633.332.932.3

32.231.830.127.127.427.426.424.022.2 i21.6 '21.321.8

43.338.535.939.040.137.636.836.736.032.328.827.2

27.129.128.325.425.725.725.924.623.422.724.024.4

COMMERCIAL FAILURES DURING NO-VEMBER.

District.

First

ThirdFourthFifthSixthSeventh.EighthNinthTenthEleventh . .Twelfth

Total

N u n

1922

149314

81122121122236120827483

203

1,737

iber.

1921

13236810214114320423898

120100145197

1,988

Liabi

1922

$2,652,7019,548,9102,945,3456,395,9062,938,5621,928,1655,928,9212,060,0851,270,805

753 9841,361,1082,480,805

40,265,297

lities.

1921

$2 302 1677,672,7322,944,372

10,689 4373,825,4123,711,2527,651 6652,028,3403,413,5042 373 7003,484,8033,372,455

53,469,839


94 FEDEKAL EESERVE BULLETIN. JANUART, 1923.

PRODUCTION AND SHIPMENTS OF FINISHED COTTON FABRICS.

Total finished yards billed during month:

23

8 . . . .

Total

Total average percentage of capacity operated:District 1

3568

Average for all districts

Total gray yardage of finishing orders received:District 1 . . .

2it568

Total

Number of cases of finished goods shipped tocustomers (case equals approximately 3,000yards):

District 123568

Total

Number of cases of finished goods held in stor-age at end of month:

District 1 .23 . .568

Total

Total average work ahead at end of month(expressed in days):

District 123568

Average for all districts

Whitegoods.

15,247,3707,802,2329 011 5048,920,714

680 905

October, 1922.

Dyedgoods.

26,386,8041 659,7237 122 887

38,649

Printedgoods.

9,937,6452,814,996

41,662,725

6880

116770

78

14,728,5397,570,026

10,753, 7139,310,930

000

42,363,208

6,2884 1925,1482,154

000

17,782

5,0315 402

347000000

10,780

4.81317140

9.7

35,208,063

904586

83

31,259,7135, 207,3588,358,734

110,353

44,936,158

0,942373

2,584

9,899

5,312517444

6,273

165.2

19

15

12,752,611

5250

52

10,053,0094,215,681

14,278,690

2,729

2,729

2,283

2,283

178.9

15

Total.

54,814,66518,357,17616 134,3918,959,363

680,9052,196,519

101,143,019

7167

101770

86

74

60,173,27922,376,96119,112,1479,421,283

0002,529,315

113,612,985

29,40810 0917,7324,530

000499

52,260

22,01913,5537,8131 297'ooo228

44,910

129.9

18140

11

12

Whitegoods.

14,758,9406,554,2488 977 8579,103,398

512,534

39,906,977

6568

1218939

78

13,339,9495,966,758

10,535,0277,974,982

000

37,816,716

5,8714 4115! 6232,003

000

.17,908

4,9825,020

694000000

10,696_

3.4

8.90

7.7

November, 1922.

Dyedgoods.

26,833,1931,520,4207 855 607

88,065

36,297,285

926394

88

29,678,5915,510,8288,512,164

195,484

43,897,067

8,819412

3,040

12,271

5,000481405

5,886

IS7.5

21

17

Printedgoods.

9,618,7013,808,807

13,427,508

5259

54

11,633,6675,005,189

16,638,856

2,647

2,647

2,061

2,061

2111

19

Total.

54,441,29619,253,73316,833,4649,191,463

512,5342,665,253

102,897,743

7174

1078939

105

78

58,289,24222,239,28319,047,1918,170,466

0002,465,306

110,211,488

29,55511 9158,5634,328

000425

54,786

22,21614,6147,969

951000219

45,969

1311198.908.2

13

1 The National Association of Finishers of Cotton Fabrics at the request of the Federal Eeserve Board have arranged for a monthly survey withinthe industry. The results of the inquiries are herewith presented in tabular form. The secretary of the association makes the following statementconcerning the tabulation:

The accompanying figures are compiled from statistics furnished by 32 out of 57 member firms of this association. It is probably fair to statethat in the absence of having specific detail at hand, but according to our best estimate it is probably well within the fact that the figures given forthe various classes of work would cover, approximately, the following percentages of the entire industry: White goods, 70 per cent; dyed goods,62 per cent; printed goods, 30 per cent. The figures given represent reports from exactly the same finishers for the two months, both for the totalsand for the subdivisions, and, therefore, are strictly comparable.

NOTE.—Many plants were unable to give details under the respective headings of white goods, dyed goods, and printed goods, and reportedtheir totals only; therefore the column headed " Total" does not always represent the total of the subdivisions, but is a correct total for the district.


JANUARY, 1923. FEDERAL BESERVE BUIXETIN. 95

PHYSICAL VOLUME OF TRADE.The general indexes of business were unusu-

ally high in November considering the seasonof the year. Mining output continued to ex-pand, while there was a seasonal decline inagricultural movements. M a n u f a c t u r i n gshowed great activity, although the total out-put was smaller in some lines than in October,on account of the less number of working days.

Receipts of all grains at 17 interior centerswere considerably larger than last November.Eeceipts of cattle and calves, sheep, horses,and mules at 59 markets declined during No-vember, but there was a marked increase inreceipts of hogs. Slaughter of hogs underFederal inspection increased to a total higherthan for any November since 1916. Wheatflour production dropped slightly below thehigh peak for October, but remained at a figure132 per cent of the corresponding month lastyear. Sight receipts and port receipts of cot-ton were smaller than in October, but Americanspinners' takings showed a considerable in-crease.

Production of steel ingots in Novemberreached 2,889,207 tons, an increase of almost17,000 tons over October and a larger total

than for any month since October, 1920. Theunfilled orders of the United States Steel Cor-poration showed a loss of 62,045 tons, which isthe first decrease in their volume since Febru-ary. Tin consumption and copper and silverproduction declined during the month, whilezinc and lead production increased. Bitumi-nous coal production expanded moderately,while anthracite output was practically un-changed. Both by-product and beehive cokeregistered substantial gains.

Cotton consumption continued to increaseduring November, and the total of 577,561bales is larger than in any month since January,1920. Silk consumption, while not as large asin October, was exceptionally high. Lumbercut by 572 mills reporting to the National Lum-ber Manufacturers' Association decreased dur-ing November but shipments show a moderateincrease. A total of 159 locomotives was com-pleted during November, which is the largestnumber for any month since April, 1921.Railroad car loadings decreased in all operat-ing regions, the largest reductions being inshipments of ore and of less than carload mer-chandise.

CENT

140

130

120

110

100

so

80

70

60

50

40

• 3 0

20

10

INDEX NUMBERS OF DOMESTIC BUSINESS1919 ~ 1922

l\i

\r\:

. . ! . .

ft A

\V

r

V

A

1•••'1

j

Vt*.

•

I

\

32v \'-•?9(/V

AGRICULTUREitlNINGMANUFACTURE

1.v

A\\AV

/,i\i •

\ •**''\/

l/V' / / • ' •

Y

/If

M1It

ii

PERCENT

1«)

130

120

110

100

90

80

70

60

50

40

30

20

10

J. F. M. A. M. J. J. A. S. 0. N. D. J. F. M. A. M. J. J. A. S. 0. N. D. J. F. M. A. M. J. J. A. S. 0. N. D. J. F. M. A. M. J. J. A. S. 0. N. D.

1919 1920 1921 4 1922



INDEXES OP DOMESTIC BUSINESS.[Monthly average of 1919=100.]

AGRICULTURAL MOVEMENTS.

Date.

1921.MayJuneJulyAugustSeptember..OctoberNovember...December...

1922.JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..

Totalagricul-ture.1

73.682.293.4

116.7115.3130.9104.693.9

88.977.770.757.482.675.179.8

106.7128.8154.2137.9

Totalani-

mals.

77.381.968.185.485.9

107.099.282.0

91.876.579.271.890.288.781.296.5

106.6132.0122.2

Totalgrains.

71.796.0

151.9195.5151.6121.365.379.0

Cotton.

67.457.852.756.0

114.7195.3163.2133.4

Fruit.

83.892.373.049.692.577.1

106.4153.8150.6135.7118.2

76.843.342.837.050.143.033.448.3

139.5227.8204.1

139.0183.3123.886.479.969.934.783.6

96.155.5

130.4103.0105.793.859.343.138.040.649.0

Leafto-

bacco.

8.94.1

12.154.779.3

107.6188.5117.0

113.2101.227.55.53.91.5

12.355.283.9

144.796.3

> Combination of 14 independent series.MINERAL PRODUCTS.

Date.

1921.MayJuneJulyAugustSeptember.OctoberNovember.December..

1922.JanuaryFebruary..MarchAprilMayJuneJulyAugustSeptember.OctoberNovember-

Totalmin-eral

prod-ucts.1

84.783.976.782.881.693.986.082.0

90.094.9

117.158.667.870.665.467.599.9

118.5120.1

Bi-tumi-nouscoal.

87.388.779.690.591.9

114.694.281.1

98.5107.3131.541.353.158.444.558.3

107.3118.3118.6

An-thra-citecoal.

102.0105.995.997.996.9

103.193.381.4

85.192.0

119.1. 3.6

1.11.62.2

67.7116.1114.1

Crudepetro-leum.

133.6128.4128.1130.2116.3113.2120.0133.3

137.1129.7149.1141.9147.7143.8148.0147.1143.8150.1152.1

Iron.

47.941.833.937.438.748.955.564.7

64.363.979.981.390.592.694.271.179.8

103.5111.8

Cop-per.

22.618.116.619.919.522.920.817.3

24.134.858.071.783.789.085.093.989.896.795.5

Zinc.

45.949.539.437.236.637.053.856.0

60.357.367.565.669.872.681.279.984.3

101.6102.3

Lead.

78.074.672.487.879.7

100.4103.3103.2

101.093.493.088.889.089.184.496.795.3

108.3111.6

1 Combination of 7 independent series.PRODUCTION OF MANUFACTURED GOODS.

Date.

1921.MayJune..July..AugustSeptember .OctoberNovember..December..

1922.JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember.OctoberNovember..

Totalman-ufac-ture.1

84.487.180.190.790.294.689.581.3

87.080.290.984.7S8.199.195.3

104.6100.3107.5

H09.3

Steel.

50.339.931.945.346.764.366.056.8

63.469.394.397.0

107.8104.898.988.194.4

114.2118.9

Lum-ber.

100.489.685.399.792.9

103.1100.692.2

100.795.4

102.598.1

121.1104.4104.3116.2101.5115.3112.9

Pa-per.

72.470.265.675.678.690.895.894.7

95.090.0

108.499.9

112.3110.699.9

110.7107.8112.8113.4

Petro-leum.

114.7110.1108.3lno. el110.2119.7117.1119.6

119.0108.6123.9124.4132.2133.8146.2141.2139.1147.2

Tex-tiles.

95.0101.994.5

103.4105.5104.8100.499.7

112.296.8

107.691.3

108.9107.195.0

115.7110.7120.0125.0

Leath-er.

83.281.176.385.780.386.290.993.0

88.278.178.570.770.472.472.180.479.582.779.1

Food.

82.285.185.598.592.899.889.485.2

91.388.596.584.996.898.997.8

104.597.8

106.7114.0

To-bacco.

99.3106.8100.6117.2111.6115.8102.976.8

90.683.898.489.6

108.1119.8114.8134.1121.6115.0112.4

i Combination of 34 independent series. ' Partly estimated.

COMMODITY MOVEMENTS.

GBAIN AND FLOOR.

Receipts at 17 interior centers(000 omitted):

Wheat (bu.)Corn(bu.)Oats(bu.)Rye(bu.) '.Barley (bu.)

Total grain (bu.).Flour (bbls.)

Total grain and flour(bu.)

Shipments at 14 interior cen-ters (000 omitted):

Wheat (bu.)Corn (bu.)Oats(bu.)Rye(bu.)Barley (bu.)

Total grain (bu.).Flour (bbls.)


Nov.,1922.

43,77924,02223,7617,8324,104

103,498 119,1313, 305 ' 3,337

Oct.,1922.

48,98732, 57725,0937,8674,607

118,372 134,149

27,39913,16618,6557,4593,146

69,8256,471

98,942

Stocks at 11 interior centersat close of month (000omitted): I

Wheat (bu.) ' 19 796Corn(bu.) j 4,854Oats (bu.) ! 26,999Rye(bu.) j 5,966Barley (bu.) j 1326

Total grain (bu.). 58,941

Total visible supply (000omitted):

Wheat (bu.)Corn(bu.)Oats(bu.)

Receipts at 9 seaboard centers(O00 omitted):

Wheat (bu.)Corn (bu.)Oats(bu.)Rye(bu.)Barley (bu.)

TotaiFlour (bbls.)


Stocks at 8 seaboard centersat close of month (000

omitted):Wheat (bu.)

37,12812,84632,940

32,7397,9754,3865,0522,002

52,1542,267

62,357

Corn (bu.)Oats (bu.)...Rye(bu.)... .Barley (bu.).

Total grain (bu.)Wheat flour production

(bbls., 000 omitted)

11,7813,5153,2553,0062,881

24,438

13,424

LIVE STOCK.Receipts at 59 principal

markets (head, 000 omit-ted):

Cattle and calvesHogsSheepHorses and mules (43

markets)

28,01922,06217,1864,3902,336

71,9935,601

97,197

20,7165,153

30,0146,0961,755

63,734

37, 41010,43635,464

17,7178,7924,9382,9094,430

1,955

47,585

Nov.,1921.

25,69417,47211,6981,9872,102

58,9533,134

73, 054

20,57412, 9739,8731,6502,071

47,1414,691

68,252

27,9178,105

55, 3683,5551,959

96,904

133,70218,197

23,3303,1021,990

9732,204

31,5991,859

39,962

10,026 16,0132,620 1,1012,177 1,5882,170 2,1612,638 3,104

19,631

13,581

Per cent ofaverage samemonth, 1919-

1921.

Nov., Oct. Nov.,1922. 1922. 1921.

143

103

140

75

164

23,967 97

10,166 I 121

Total.

2,4084,3972,241

52

117

119

76

118

114

2,9173,6573,253

56

1,916 1033,666 1172,029 j 93

28 i 82

7,639 107 114

77121797251

85108

93142826468

97

8218917256

105

123

125212

7651

115

11579

105

9112674

122109

95

92

829S85

45


JANUABT, 192S. FEDERAL RESERVE BULLETIN. 97

COMMODITY MOVEMENTS—Continued.

LIVE STOCK—continued.

Shipments at 54 principalmarkets (head, 000 omit-ted):

Cattle and calvesHogsSheepHorses and mules (43

markets)

Nov., I Oct.,1922. i 1922.

Nov.,


1921.

Nov.JOet./Nov.,1922. il922. 1921.

1,3331, 495 |1, 436

52 :

1,557 , 9921, 287 i 1, 2902,158 ! 1,077

55

114 121112 : 114104 i 113

27 85 84

Total 4,315 5,058 3,386 109! 115

Receipts at 15 western mar-kets (head, 000 omitted):

Cattle and calvesHogsSheepHorses and mules

Total..

Shipments atl5 western mar-kets (head, 000 omitted):

Cattle and calvesHogsSheepHorses and mules

1,7732,9821,383

34

2,2,1,

24039495239

1,2,1,

39456024419

102 j 119114 ! 120 :85 ! 64 :88 I 93

86

6,171 ! 6,624 5,217 I 105 j I l l

Total i 2,724 j 3,120 2,177

Shipments of stockers andfeeders from 34 markets(head, 000 omitted):

Cattle and calvesHogsSheep

Total..

Slaughter at principal centersunder Federal inspection(head, 000 omitted):

CattleCalves ,HogsSheep

Total-

Meats, cold storage holdingsfirst of following month(lbs., 000 omitted):

Beef.Pork productsLamb and mutton

Exports of certain meat prod-ucts (lbs., 000 omitted):

Beef-CannedFreshPickled and other

curedHogproducts—

BaconHams and shoulder. .LardPork, pickled

DAIBY PRODUCTS.

Receipts at 5 principal mar-kets (000 omitted):

Butter (lbs.)Cheese (lbs.).

Cold-storagefollowingomitted):

Creamery butter ( lbs . ) . . .American cheese ( lbs . ) . . .

2,017 | 1,032 j 109 i 112

73,850 65,13840,837 34,0625.723 ' 2,402

47,80737,1693,257

COMMODITY. MOVEMENTS—Continued.

Nov.,1922.

Oct.,1922.

I Per cent ofI average sameJ month, 1S19-

Nov., 1921.1921.

:69G, 7481609,679

[857,734 1771,197

183,522115,247

13,47735,465

OTHER AGRICULTURALPEODUCTS.

Cottonseed (tons):Received at millsCrushedOn hand at mills at close

of monthCottonseed oil (lbs., 000

omitted):ProductionStocks

Oleomargarine consumption(lbs., 000 omitted)

Tobacco sales a t loose-leafwarehouses (lbs., 000 omit-ted):

Dark belt—VirginiaBright belt—

, VirginiaNorth CarolinaSouth Carolina

BurleyWestern dark : 1)279

Sale of revenue stamps formanufacture of tobacco, [excluding Porto Rico andPhilippine Islands (000,000 !omitted):

Cigars (large) j 679Cigars (small) I 51Cigarettes (small) ! 4,524Manufactured tobacco '

(lbs)Fruit shipments (carloads):1

GrapefruitOrangesLemonsApples

White potatoes, shipments(carloads)

Sugar, 7 ports (long tons):ReceiptsMeltingsRaw stock at close of

month

|959,3401590,235

603,573,

762,

932776

726

INov.,J1922.

9090

' 121t

Oct.,1922.

9591

126

Nov.1921.

7885

107

I 98,872

19,806 j 16,180

[173,574 88111,916 I 81

17,565 I 69

90 I

;,154 i 1,850 i 7,725

19,15361,578

22,73073,207

4,8

FOREST TEODUCTS.

Lumber:Number of mills—

National LumberMfg. Assn

Southern pineWestern pineDouglas fir

Production (ft., 000,000omitted)— '


Southern pineWestern pineDouglas nr

Shipments (ft., 000,000omitted)—


Southern pineWestern pineDouglas fir

Receipts at Omeago andSt. Louis (M ft.).

31

1,548314

2,56129,303

882 !316

694 !54 !

4,498 j

33 '

219496

1,17313,903

19,547 33,711

J221,485

3,5955,090

61553

4,230

28

1,377588

3,111

56

10592108

116 '

312,725309,274

69,185 i 94,043

! 280,003

35,117 .

16,729 j .

275,755268,283

82,253

Shipments a t Chicagoand St. Louis (M f t . ) . . .

Oak flooring (M ft.)—ProductionShipments.Stock at end of monthUnfilled orders

572174

291

479,660

312,856

26,82826,43119,13235,209

475 j18456

104

81341266

260

56417550

112

1,306402 j168 I417!

1,066336109320

507,934 |496,195

321,713 J305,188

88042398221

133115

"129"

105 j85

102102 ;

28,35729,18519,01432,296

8379

57 i 61

127 13S

107108

259

9596101

105

136 119 90109 104 i 111

130 ' 70137 115 i 92

10211710798

118 123 122

123 i 127 i 125

1 Figures for October, 1922, September, 1922,

16,933 j .I 19,544 ' L

20,922 i j .I 21,022 I I.October, 1921.




FOREST PRODUCTS—COlltd.

Naval stores at 3 southeasternports:

Spirits of turpentine(casks)—

ReceiptsStocks at close of

monthRosin (bbls.)—

ReceiptsStocks at close of

month

1'UEL AND POWER.

Coal and coke (short tons, 000omitted):

Bituminous coal produc-tion (est.)

Anthracite coal produc-tion (est.)

Nov. ,1922.

Oct. ,1922.

Anthracite coal shipmentsCoke-

Beehive production(est.)

By-product, produc-t ion^.)

Petroleum, crude (bbls.000,000 omitted):

ProductionStocks at close of month..Producing oil wells com-

pleted (number)Oil refineries:l |

Production (000.000 omit-ted)— ' I

Crude oil run (l>bls.).'Gasoline (gals.) I

' Kerosene (gals.) 'Gas and fuel oils I

(gals.) !L u b r i c a t i n g oils I

(gals.)Stocks at close of month ;

(000,000 omitted)—Crude oil run (bbls.)JGasoline (gals.) \Kerosene (gals.)Gas and fuel oils •

(gals.) !L u b r i c a t i n g o i l s

(gals.) !Electric power produced

by public utility plants(000,000 kw. hrs.):

Produced by water power

45,262

8,3856,420

1,139

2,908

48276

1, 150

•14

.566215

922

87

33724256

1,369

21S

. , , 1,36!)

Produced by fuels j 3,030

Total

METALS.Iron and steel (long tons, 000

omitted):Pig-iron production2

Steel-ingot production s . .Unfilled orders, U. S.

Steel Corporation 2

Fabricated structuralsteel contracted for(tonnage)

Silver production (troy ozs000 omitted) '.

Copper production (lbs., 000omitted)

Zinc (lbs., 000 omitted);Production .Shipments.Stocks, close of montJi

4,399

3,0872,780

6,746

99,040

4,870

102,593

80,40077,49238,994

45,154

8,5306,568

S78

2,806

47274

1,388

43536198

918

82

34690271

1,365

215

1,3.512,799

4,330

35,955

6,8595,314

477

1,751

38178

899

38441182

834

76

456335

1,238

217

1,2182,422


1921.

iNov.,|Oct.,iNov.,;1922. 1922. !l921.

25,092

40,161

99,591

52,465

30,

30,

98,

320,

519

681

804

213

24

62

98

321

801

072

260

478

112 130 , 110

86 !

116 ! 130 i

137 ' 13S '

68 | 133

114

125

127

114 105

3,639

2,8502,889

6,840

1,6491,427

4,268

121,150 I 99,800

5,161

103, S81 j

79,88081,40636,086

I 3,790

' 22,348

42,27049,820134,098

91 c 72

132 131190 190

102

' 93

108

118 I 119

106

19019573

143

129

109

199176 ]78 |

143 I124

86142

3S

105123

SS | 86 j 55

117 I 101133 j 104

8S

107

92

10712396

1.30

129

73123

121 I 121 i 100

133 ; 127 71133 12S i 68

98 ! 101 i 62

1 Figures for October. 1922, September, 1922, October, 1921.1 Figures for December, 1922, November, 1922, December, 1921.


N o v . ,1922.

Oct . , i N o v . ,1922. ! 1921.

METALS—continued.

Tin (lbs., 000 omitted): IDeliveries to factories | 10,779 12,551 7,280Stocks at close of mouth..j 2,699 • 2,859 j 1,316

TEXTILES.

Cotton (bales, 000 omitted):Sight receiptsPort receiptsOverland movemen tAmerican spinners' tak-

ingsStocks at ports and inte-

rior centersStocks at millsStocks at warehousesVisible supplyConsumption by millsSpindles active durin;;

month (number, 000 iomitted)! ;

Wool:Consumption 'Percentage of active ina- j

ohineryonls tofmonthto total reported— i

Looms wider than j50-inch reed space.. I

Looms 50-inch reed Ispace or less 1

Sets of cards 'Combs |Spinning spindles, '•

woolen !Spinning spindles, :

worstedPercentage of idle hours ;

on 1st of month to total :

reported—Looms wider than

50-inch reed space..Looms 50-inch reed |

space or lessSet of cardsCombsSpinning spindles,

woolenSpinning spindles,

worstedRaw silk:

Consumption (bales)Stocks at close of month

(bales)

2,156 2,3311,162 1 278

237 160

1,150 788

2,224 2 1881,721 : 1,3804,198 I 4,3303.876 ! 3,3X5

578 ' 534

34,665 33,859

63,313 59,282


1921.

Nov.,1922.

109

Oct.,1922.

1,704 109760 116232 | 120

I1,076 | 130

2,679 i 851,655 i 117r 293 i 87

Nov.1921.

196

92112115

4^623 ! 89 ! 87 ;

528 ! 128 i 110 '

80.8 ;

82.085.787.0

S4.4

90.0

80.0

72.793.7

111.4

89.7

77.1 73.4 116

HIDES AND LEATHER.

Sales of raw hides and skinsduring month (number, 000omitted):

Cattle hidesCalfskinsKip skinsGoat and kidCabrettaSheep and lamb

Stocks of raw hides and skinsat close of month (number000 omitted):

Cattle hidesCalfskinsKip skinsGoat and kidCabrettaSheep and lamb

Production of leather (000omitted):

Sole leather (sides)Skivers (dozens)Oak and union harness

(sides stuffed)

79.1 '85.886.8

84.4

89.1

77.793.8106.4

90.6

94.0

35,467 . 37,471

47,159 45,893

78.377.583.9

! 115119110

77.6 | 116

89. S ! 112 I 107

7... |

74.378.893.8

78.1

87.4

24,955

19,601

1 536906336

1 50852

3,001

6,1633,6921,1533,2021,0369,409

1,48434

135

I1

1

3

5,3,1,8

9,

1,

4751?1">54097

61876

8384«H089681841561

3,5

133

1

•5,3,1,

11

13,

1

r>R77410">646

9021480022«7.527364

70518

60

I

lOfi133101635879

91113

95644781

89111

8391

113

73

133 | 86122 i 76122 | 117

129 i 122

102112110106117

34,428 : 103 99 103

53,463 ; ! ;....

108 j 106

110107106

110 107


JANUARY, 1923. FEDEKAL RESERVE BULLETIN. 99


Nov., Oct., Nov.,1922. : 1922. 1921.

NovJOct.,!Nov.,1922. 1922. J1921.

HIDES AND LEATHER—contd.Boots and shoes, output

(pairs, 000 omitted):Men's 8,759Women's ; S,938Other 12,912

8,5579,495

13,042

Total ' 36,609 31,093MISCELLANEOUS MANUFAC-

TURES.Wood pulp (short tons):

Production :300,Consumption l2U,Shipments ! 58.Stocks, end of month I124J

Paper (short tons):Newsprint—

ProductionShipmentsStocks, end of month.

Book paper production...Paper-board production..Wrapping-paper produc-

tionFine paper production...

Building materials (000 omit-ted):

Clay fire b r i ck -ProductionShipmentsStocks, close of monthNew ordersUnfilled orders

Silica b r i ck -ProductionShipmentsStocks, close of month

Face b r ick-ProductionShipmentsStocks in sheds and

kilnsUnfilled orders, close

of monthCement (bbls., 000 omit-

ted)—ProductionShipmentsStocks, close of month

Rubber (lbs., 000 omitted):Consumption by tire

manufacturersPneumatic tires (000 omitted):

ProductionShipments, domestic. -. -.Stocks

Inner tubes (000 omitted):ProductionShipments, domesticStocks

Solid tires (000 omitted):ProductionShipments, domesticStocks

Automobiles:Production (number)—

Passenger carsTrucks

Shipments-Railroads (carloads)..D r i v e w a y s (ma-

chines)Boat (machines)

Locomotives (number):Domestic shippedForeign completed

127,128,19,93,198,

77,31,

284,642261,32064,908136,931

130,682129,74719,74592,865196,769

74,63033,774

55,99659,29952,10151.12070,860

1215,20,

27,232

TotalUnfilled orders-

Domestic . .Foreign

14415

159

1,501118

6,7806,8759,937


1921.

23,593

271,787 j212,92762,142

158,555 :

104,604104,492 |23,12773,544 I

172,582 I

65,905 i24,609 ,

31,92129,230142,00229,96425,883

1108876

9911496

111

100 I 96113 i 109122 102

119 j 109108 ! 108

121 ; 110111 ! 107123 109141 111I87 76

15,755 I 4,57213,161 I 5,282 j39,730 41,379

57,185 I 45,582 99 I 10541,062 I 28,280 ] !

919011889106

10184

6!)591127832

01,782 1142,135 ' 78 i S2 119

65,558 ; 35,891 86 i 76 60

12,287 | 8,92112,854 5,1954,149 9,091

30,894

2,6752,5894,683

3,7883,4215,488

8571214

214,09020,591

27,100

35,2037,605

17,609

1,7571,343 j3,908

2,126 !1,540 i5,204 I

4435

173

14,264 i

10,5281,402

13312

14 167

145 ! 29

1,420118

Total 1,619 1,538' '

83 24

COMMODITY MOVEMENTS—-Continued.

MISCELLANEOUS MANUFAC-TUEES-continued.

Vessels built in United Statesand officially numbered bythe Bureau of Navigation:

NumberGross tonnage

Nov.,1922.

Oct.,1922.

!

Nov.,1921.


1921.

89 7127,720 33,815

TRANSPORTATION.Kailroad operating statistics:1

Net ton-miles, revenue,and nonre venue (000,000omitted)

Net tons per trainNet tons per loaded car . .

Revenue freight loaded andreceived from connections,c l a s s i f i e d according tonature of product (cars,loaded, 000 omitted):

Grain and grain products.LivestockCoalCokeForest productsOreMerchandise, l . c . lMiscellaneous

7961,599

78 !13 j

:9,260 i 34,270 36,670 I 98732 ' 721 702 9827.7 i 27.3 27.2 97

Total.

Revenue freight loaded, clas-sified according to geo-graphical divisions:

EasternAlleghenyPocahontasSouthernNorthwesternCentral westernSouthwestern

230 •168 ,84954

268126975

22617584646

258203998

16413567728

143111121120

212 11835 109

955 1211,435 j 1,549 ! 1,083 111

4,105 I 4,301 3,289 117 102

1,041874131590564610295

1,061889130592663656310

840672130498407484258

Total . 4,105 i 4,301 j 3,389Freightcarsurplus (number):

Total : 5,209 i 4,475Box.Coal

Freight car shortage (num-ber):

Total 154,771Box ' 79,818Coal 43,722

739 I 1192,10S ! 1,993

160,787 j80,23744,833 '

182,45272,68078,140

1,775522806

Bad order'cars," total. ' . '..!.'•'. 1 226^ 288 J249,960 ^345,201Vessels cleared in foreign : ; |

trade (tons, 000 omitted): ( :American I 3,446 3,358 2,748Foreign | 2,799 ! 2,778 ' 2,200

TotalPercentage of American

to totalPanama Canal traffic (tons,

000 omitted): l

Total cargo trafficAmerican vesselsBritish vessels

Commerce of canals at SaultSte. Marie (000 omitted): I

Eastbound— [Grain other than i

wheat (bu.) jWheat (bu.) !Flour (bbls.) IIron ore (short tons)..!Total (short tons) !

West bound— jHard coal (short tons).'Soft coal (short tons).Total (short tons) ITotal freight (short j

tons)

6,245 | 6,136 i 4,949

55.2 ' 55 50

1,446 1,138 986649 I 543 ' 383432 372 367

18,295 | 8,572 : 13,54175,087 I 56,707 i 53,333

1,441 1 1,402 ! 1,8873,658 i 5,872 3836,559 ' 7,996 2,519

282 26S2,455 2,6892,909 : 3,237

159474746

6930

929695

1028997

3011884

94

919298829599

117 102 94

125 114120 97

9,468 i 11,233 3,265 j 159

95

97

102

110

1241849398

110

70 !US140 :

115 i

12714812312

505456

55

i Figures for October, 1922, September, 1922, October, 1921.



BUILDING STATISTICS.BUILDING PERMITS IN 168 SELECTED CITIES.

[Collected by the 12 Federal Reserve Banks.)NUMBER OF PERMITS ISSUED.

District District District DistrictNo. 1 ' No. 2 No. 3 No. 4(14 (22 (14 (12

cities), cities), cities), cities).

District ' District! District iNo. 5 I No. 6 1 No. 7 i

(15 (14 \ (19 !

cities), cities), cities).

DistrictNo. 8

(4cities),

i District! District Districti No. 9 I No. 10 No. 11

(9 I (14 (9j i t i ) j citi

(9 I (14cities), j cities),

(ies).

DistrictNo. 12

(20cities).

1921, November 1,795 7,549 2,1031922,January 878 4,176 1,623February 1,024 1 4,210 2,081March 2,364 13,284 3,557April.. 3,023 i 9,056 4,386May 3,446 ! 10,136 3,991Juno , 2,943 i 9,572 3,624July 2,597 | 7,761 3,029August • 2,873 1 7,828 . 3,044September i 2,734 1 8,424 . 3,680October ! 2,911 1 9,672 ! 3,169November ! 2,301 I 9,022 i 2,504

2,9981,7242,6194,9866,1496,6665,8394,6805,093 :4,789 ,5,064 ]4,130 !

3,1102,1882,3054,1014 3975,3214,5093,7564 0183,9973,930 j3,433 ;

2,6772,1552,5663,2113,2153,4433,0852,9783,1303,1143,335 i3,010 !

6,594 :3,4984,8158,80611,54613,79911,89810,38511,11210,55311,9889,437

1,451 i1,141 :1, 434 i2,2182,650 ,2,9552,5072,2912,3542,373 .2,4922,048 •

1,

1,3,

105523517 j493 !342

3,3912,2,2,1,2,1

422125244923029437

2,0841,3361,7582,7113,1033,5542,8882,4672,7782,6292,9062,669

2,479 |1,653 i2,1142,6232,6862,7942,545 i2,238 :2,534 i2,223 j2,470 I2,184 |

10,1628,2987,600

11,19610,96611,26610,1569,415

11,59611,29112,25410,490

Total(16«

cities).

44,10728,88433,04360,45064,49970,76261,98853,72268,60457,91962,23052,685

VALUE OF PERMITS ISSUED.

1921, November1922, January...FebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovember

District No.1 (14 cities).

I 6,159,262 :

7,380,701 iI 9,280,82/ !i 11,089,077 ji 14,921,509 ii 13,104,967 jI 10,600,450 j| 9,174,687 !

16,633,8198,656,4599,159,7318,387,694


53,698,15250,145, 29650,372,553

119,964,78354,704,29257,843,58",73,352, 56447,144,02349,210,63756,670,10866,963,52466,683,756


9,290,556 '6,878, 5238,275,338

14,116,29217,020,50013,844,81318,177,75915,898,69615,352,65515,868,67013,806,295 ;15,357,321 i

District No. :4 (12 cities), j

11,010,5915,713, 2097,829, 585

13,814, 86815,693,18322,614,08422,428,25126,558,68022,036,88225,076, 76614,906,54014,712,598

District No. ! District No. District No.5 (15 cities). I 6 (14 cities). 7 (19 cities).

0,019,114 !8,352,615 i7,513,54211,329, 04911,971,47113,348,592 |15,736,766 i15,514,62511,605,153 ,12,969,81211,291,7959,519,324

3,931,32S3, 734,2624,630, 0526,021, 2114,951,5587,262,1676,498,6777,516,0367,985,2126,326,0748,048,8805,124,902

22,328,62818,905,56120,419, 41733,747,13535,089,30353,806,49949,934,58338,151,18240,452,97231,550,16934,088.48441,424,978

1921, November1922, January. . .FebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovember

District No.8 (4 cities). |

2,570,707 !2,579.894 !4,150,487 |5,012,607 i6,076,6847,443,8555,855,4595,698,7925 815,8055,384,0426,353,6375,811,979

District No. I District No.9 (9 cities). ! 10 (14 cities).

3,022,9612,110,4241,569, 7744,526,2098,196,110 '9,913,8536,020,1867,663,443 j8,284,659 •4,737,015 I4,716,8025,273,142

5,590,2105,023,6034,336,0117,165,9258,384,65210,807,0848,894,1318,040,6069, 793,3528,352,4408,989,0798, 277,871

District No. District No. ! Total (16611 (9 cities). 12 (20 cities).' cities).

4,331,965 19,579,992 147,553,4664,960,078 22,872,876 : 138,631,9024,419,789 18,917,868 141,715,2435,630,336 27,432,286 i 259,847,9986,228,385 ! 30,195,052 213,432,7994,752,642 \ 28,271,238 243,013,0795,276,819 ! 29,598,278 252,373,9235,861,650 ! 22,391,016 i 209,613,4365,010,204 i 29,424,332 > 221,605,6824,980,057 '• 23,968,073 , 204,482,9444,765,340 29,338,159 i 211,525,5323,859,909 26,200,472 210,633.946

VALUE OF BUILDING CONTRACTS AWARDED, BY FEDERAL RESERVE DISTRICTS.[F. W. Dodge Co.]

VALUE OF CONTRACTS FOR ALL CLASSES OF BUILDINGS.

DistrictNo. 1.

1921," December 25,593,8501922, January 15,302,453February 14,799,476March 26,212,330April .• 42,196,915May 31,589,783June 36,259,420July 24,910,926August 26,780,103September 29,245,087October 25,305,051November 25,297,599December 19,739,632

DistrictNo. 2.

63,210,85054,962.84760,152,42490,088,870

117,814,58591,441,14181,614,20579,819,08480,810,92264,298,55665,060,95677,700,08158,684,871

DistrictNo. 3.

15,551,50012,128,90011,828,70024,558,10024,795,80025 739,29426,630,90028,768,37743,818,91124,947,91620,439.85216,929,28918,706,115

DistrictNo. 4.

17,820,88221,066,28220,602,82329,661,05838,089,75458,432,71446,801,80052,224,00150,811,59634,634,72335,164,63029,337,24028,041,621

DistrictNo. 5.

19,552,33314,002,39916,518,07924,116,01125,618,12032,268.76730,668,19125,362,18720,983,61922,997,45019,684,62719,848,00415,677,542

DistrictNo. 7.

DistrictNo. 9.1

j TotalI (7 districts).

32,219,28529,182.32432,344,42458,081,52664,236,56671,117,05577,560,94083,159,79556,954,434 '62,219,68152,048,24145,428,67345,128,035

9,685,0543,613,1485,192,824

11,933,2709,878,501

12,455,41012,153,0619,304,3258,249,9055,868,2004,523,1264,810,1205,285,253

183,633,754150,258,353161,438,750264,851,165322,630,241323,044,164311,688,517303,548,695288,409,490244,261,613222,226,483219,351,006191,263,069

VALUE OF CONTRACTS FOR RESIDENTIAL BUILDINGS.

1921, December.1922, January...FebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember

16,847,210 !4,767,597 j4,179,944

11,897,086 j13,524,827 !14,018,303 !12,518,840 j12,644,574 !11,945,451 j11,509,627 i13,552,66313,667,23913,962,708

44,582,99035,652,20338,657,15651,116,51453,677,47339,943,54740,483,06333,364,78729,091,73834,536,71033,237,93651,891,84242,981,478

6,669,200 I6,280,2005,647,7009,552,500

10,408,70011,168,86811,275,5177,826,5818,828,6678,142,367

10,072,2607,397,453

11,526,372

6,903,1936,279,4596,545,073

10,641,17716,127,62719,121,79817,434,09515,406,30113,409,25812,736,60513,729,840 !

11,405,40717,809,202

5,970,062 i6,597,861 [7,299,608 i9,796,405 ;

10,297,28013.009,760 '16,036,790 i8,074,1636,320,0308,595,7177,416,1087,997,5135,002,996 ;

10,740,666 j10.601.761 I9,388,615 i

17,225,204 I17,661,58624,574,83528,206,83820,633,345 :18,833,05015,011,66420,291,37922,307,99417,949,393

2,633.2541,049,694

962,757 !2,348,511 I4,176,963 :4,240,047 '2,677,1842,415,4382,535,5902,453,7232,227,6142,847,4522,046,342 i

94,346,57571,228,67571,680,853

112,577,397125,873,466126,077,158128,632,327100,365,18990,963,78492,986,41$

100,527,800117,514,900111,278,491

1 Montana not included.


JANCARY, 1923. FEDERAL RESERVE BULLETIN. 101

RETAIL TRADE.

The following tables are a summary of thedata obtained from 488 representative depart-ment stores in the 12 Federal reserve districts.In districts Nos. 1, 2, 3, 5, 6, 7, 9, 11, and 12 thedata were received in (and averages computedfrom) actual dollar amounts. In districts Nos.4, 8, and 10 most of the material was receivedin the form of percentages, and the averages forthe cities and districts computed from such per-centages were weighted according to volume ofbusiness done during the calendar year 1921.

The tables for the month of November arebased on reports from 25 stores in district No. 1(Boston), 64 stores in district No. 2 (New York),141 stores in district No. 3 (Philadelphia), 36stores in district No. 4 (Cleveland), 25 stores indistrict No. 5 (Richmond), 36 stores in districtNo. 6 (Atlanta), 54 stores in district No. 7(Chicago), 20 stores in district No. 8 (St.Louis), 25 stores in district No. 9 (Minneapolis),18 stores in district No. 10 (Kansas City), 21stores in district No. 11 (Dallas), and 33 storesin district No. 12 (San Francisco).

A comparison of monthly changes in activityof different types of retail business since Jan-

uary, 1921, is shown in the second of the follow-ing tables. The 176 department stores arelocated in districts Nos. 1, 2, 3, 5, 6, 9, 11, and12, while the mail-order houses do business inall parts of the United States. The UnitedStates index for department stores is computedby weighting the districts according to the buy-ing power, as measured by population andbanking resources. 'Chain-store figures arebased upon the total sales of the same report-ing chains for each month, but the actual num-ber of stores in these chains varies slightly.

Chain stores selling groceries, shoes, andmusical instruments increased their sales inNovember, while drug stores, cigar stores, and5-and-10 cent stores reported decreases. Allreporting lines had larger sales than in Novem-ber, 1921, the most substantial increases beingreported by grocery, 5-and-10 cent, and musicchains. The accompanying chart shows thecourse of business of department stores andmail-order houses since 1919. It will be notedthat sales of department stores were larger inthe fall months of 1922 than in either 1919 or1921, but smaller than in 1920. Mail-order busi-ness this autumn was substantially larger thanin 1921, but less than in the two previous years.

COMPARISON OF SALES OFDEPARTMENT STORES AND MAiL ORDER HOUSES

1919 - 1922( AVERAGE MONTH. 1919 = 100 )

180

160

140

120

100

80

60

40

20•DEPARTMENT STORES (159)-MAIL ORDER HOUSES (-4)

80

60

40

20

J. F. M. A. M. J. J. A. 5. 0. N. D. J. F. M. A. M- J. J. A. S. 0. N. D. J. F. M. A. M. J. 0. A. S. 0. N. D. J. F. M. A. M. J, J. A. S. 0. N. D.

1919 1920 1921 1922



CONDITION OF RETAIL TRADE IN THE FEDERAL RESERVE DISTRICTS.

[Minus sign (—) denotes decrease.]

Percentage of increase in net sales j P e r e p n t a M o f j n ( . r e a , e i n ctnets at

P°eS&arper^fyeareSPOn<Ung ! ^ M S ' S ^ S S - *

District and city.

j Novem-iber, 1922.

District No. 1:BostonOutside

District..

Octo-ber, 1922.

| Novem-jber, 1922. ber, 1922.|ber, 1922. ber, 1922.!ber, 1922.

8.36.77.9

District No. 2:New York and Brooklyn . . .BridgeportBuffaloNewarkRochesterSyracuseOutside

District

District No. 3:PhiladelphiaAllentownAltoonaChesterHarrisburgJohnstownLancasterReadingScrantonTrentonWilkes-BarreWilliamsportWilmingtonYorkOutside

District

District No. 4:Cleveland.AkronCantonCincinnati.Pittsburgh.ToledoOutside

District.

District No. 5:Richmond.Baltimore.--Washington.Outside....

District..

District No. 6:AtlantaBirminghamChattanooga.Nashville.. . .New OrleansSavannahOutside.

District

District No. 7:ChicagoDes MoinesDetroitIndianapolisMilwaukee.Outside

District

7.39.54.3

14.12.83.36.68.1

5.6- 3 . 6

3.6

mIiL1^t0 [ S a l v K L p r e - i ***»» -<»«>.;

Percentage ofaverage stocksat close of eachmonth to aver-

age monthlysales for same

period.

July 1,1922, toclose of—

Percentage ofoutstanding

orders at close ofmonth to total

purchasesduring previouscalendar year.

Octo- I Novem- i Octo- iNovem-

10.924.116.255.615.0IS. 18.9

11.43.9

12.71.15.3

19.25.36.4

11.4

3.82.89.1 !9.6 :6.8 ,3.9 ig 14.5 !

_ i _

9.04.37.8

7.65.64.87. 55.61.91.86.9

5.411.9

- 1 . 033.75.51.8 |

- 4 . 1 j2.3 I

- 5 . 66.6

- 1 . 1- 7 . 9 ;

17. 5- 5 . 410.7 ,1.7

7.512.43.0

28.912.0

- 1 . 20.78.2

-11 .28.9

- 4 . 7- 2 . 012.93.43.86.1

9.23.67.9

7.74.54.95.26.41.50.46.5

5.41.13.6

1.32.9 i

- 2 . 9 [6.4 i

- 1 . 5- l . o !- 8 . 1 I

1.1

Octo-ber, 1922.

- 2 . 4 '•4.7 I

3.84.64.0

6.87.67.0

Novem-ber, 1922.

324.2422.5345.3

- 0 . 3- 7 . 8- 3 . 7—3.4- 1 . 7- 7 . 3- 2 . 5

6.07.0

- 0 . 820.411.0

- 6 . 3—0.9

7.4-12 .7

7.6-7 .8- 5 . 411.13.73.3

- 2 . 1- 4 . 1- 9 . 5

- 0 . 71.8

-11 .7

10.11.2

- 0 . 40.1

15.4- 0 . 1- 8 . 1

2.6- 5 . 7— 7.312.0

- 0 . 5

11.31.50.4

- 0 . 610.8

- 1 . 7-8.8

6.2- 2 . 6—4.7

IS. I0.4

7.03.85.1

n.7 ;4.04.2

- 0 . 55.6 I

Octo-ber, 1922.

333.4424.0354.0

2.05.23.9 j3.17.0 |1.6;8.4 |3.6 !

345.5410.9392.3342.7357.0374.7544.7348.6

0.21.92.3

7.01.39.1

337. 0589.3477.6

363.0408.2379.2362.7362.0384.7560.2365.1

Novem-ber, 1922.

6.66.56.5

7.7 I8.7 i6 . i :2.34.0

Octo-ber, 1922.

7.5 |6.7 !

363.7595.0479.3

1.91.33.6

-0.45.32.10.3

-1.84.0

-1.82.10.9

7.27.41.32.4

-0 .61.84.26.47.0 !

7.96.0

488.6446.9514.7590.1409.6435.3459.9501.3680.1488.1579.1413.0

502.3466.4534.8619.2452.6458.0493.2433.4694.9545.9595. 9435.4

8.7 i5.0 !

12.8 |

10.6 I5.0

5.6 •3.3 i7.58.1

7.56.87.4

8.57.28.96.56.87.37.38.2

9.14.8

13.5

9.54.4

7.35.16.58.5



CONDITION OF RETAIL TRADE IN THE FEDERAL RESERVE DISTRICTS—Continued.

[Minus sign (—) denotes decrease.]

District and city.

District No. 8:

Little Rock.Louisville

District '

District No 9District No. 10:

Denver...

District...

District No. 11:DallasFort Worth...

Outside

District No. 12:

Los Angeles

Salt Lake CitySeattleSpokane

United States

Percentcompjperiod

Novem-ber, 1922.

4.11.86.6

15.73.16.1

- 0 . 5

10.51.32.62.3

" 46.42.8

- 6 . 80.4

12.318.47. S2.1

22.35.1

14 o

9.0

ige of incred witprevious

Octo-ber, 1922.

8.60.1

—3.67.70.76.0

8.2

6.30.9

- 0 . 5

- 9 . 2- 5 . 6

1.4-14.4- 8 . 4

9.616.06.57.2

10.6- 1 . 410.3

4.5

rease in net sales ; P e r c e I l t a g e o f i n c r e a s e i n s

year ! c l o s e o f m o n t h c o m P a r e d

July 1,1922, to ! Same month pre-1 p_.,T i n , ,close of— ' vious year. ! l r e v l o u

Novcm-! Octo- ] Novem-! Octo- j Novem-ber, 1922.!ber, 1922.!ber, 1922. ber, 1922.jber, 1922.

4 7—6 0

1.711.2

4.3

'> 7

3 6—2.1

-l . i

2 81.50 1

— 10.2- 1 . 8

6.910.60 71 1

12 8- 2 . 6

•

6.0

4.8—13.9- 0 . 1

9.62 63.4

3 8

7 00.83 1

- 3 . 8

: 2.91 0

0.71 —12.3, - 2 . 8

5.4i 8.6! 1 5i 0.8

10 5—4.4

6.0

4.6

0.25.7

-15.4—2.7

7 51 - 1 . 9

! 1 7

4 1— 1.5

4 0- 0 . 1

—8.1- 7 . 4

-11 .4I -15 .9| -10 .9

- 0 . S- 7 . 0—3.9

0.93.2

- 0 . %- 2 . 5

: - 0 - 7

- 0 . 8 ;

0.6-18 .1 '—5.9

5 2 '- 4 . 0 :

0 5 '

13 4— 1.6

1 8- 6 . 4 |

— 7.9 i- 8 . 8 !

9.1 :— 16.6 1-10 .8 |

—2.9 ;

-12 .9 !4.1 :

—1.4 ,4.40.7

- 4 . 7 :

- 2 . 8 i

2.32.91.26.34 52.7

2 1

9 22.33 3

- 0 . 8

- 2 . 00.6

—0.91.6

- 0 . 4

9 78.40.72.32.5

—2 13.5

2.2

toeks atwith—

5 month.

Octo-ber, 1922

3.31.97.95.41 l4.1

4 3

1 9- 2 . 0

0.2

2.92.93.2

- 1 . 91.6

3.0- 0 . 4

2 43.05.9

- 2 . 2LSI

4.1

Percenaverageat closemonth

agemsales fc

per

iJu ly l ,

close

Novem-ber, 1922.

366.6443.2364.0468.0538 5392.8

306 3

466 4533.3

' 478 3490.1

437.61 491.2! 510.0

458.4464.3

i 431.0! 386.9

545 753S. 0393 2582.5

, 431.0

397. 9

tage ofstocksof each;o aver-Dnthlyr sameod.

1922, toof—

Octo-ber, 1922.

383.7477.2373.5488.5539 2409.2

452 9

487 2486.0542 1507.0

453.4508.9538.6475.1483.3

435.7390.9541. 8549.3389.1593. 5434.4

426.5

Percentage ofoutstanding

orders at close ofmonth to total

purchasesduring previouscalendar year.

Novem-ber, 1922.

6.05.33.8

12.43.26.4

4.5

2.711.96.26.8

8.55.83.76.67.2

10.610.8

3.68.28.99.8

7.4

Octo-ber, 1922.

7.16.46.3

12.44.77.7

6.2

5.010.9

7.67.1

9.27.15.05.77.6

10.812.7

6.36.5

10.7

8.2



JanuaryFebruary. -.MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..

AVERAGE MONTHLY VALUE OF RETAIL TRADE.

[Average month 1919=100.1

1919.

1920.

1921.

1922.

' Partly estimated.

Depart-mentstores

(176 stores)

75.768.985.498.398.193.177.277.696.4

124,6122.1182.7

104.985.4

120.0117.5124,0118.092.290,9

106.9131.9135.9180,7

101.687.3

116.3111,7111.3108.579.783.292.7

127.8121.3175.8

87.280.0

101.5111.9113.9105.878.484.8

102.5131.2130.0

Mail-orderhouses

(4 houses).

86.173.182.691.581.374.576.182.1

102.1155.9148.2146.4

120.2122.2130.7107.590.487.380.780.290.5

103.7125.597.9

69.164.895.177.560.262.149.356.472.788.683.380.3

65.359.483.577.169.968.858.457.2

>76.1• 110.0i 112.5

Grocery(17 chains).

89.886.596.193.394.590.4

100.898.299.8

119.0111.5120.1

129.9127.5146.7153.1151.7148.6157.4141.8141.8141.7139.3137.0

124.5118.5128.2121.3118.4115.6114.4120.6118.0134.7132.8143.5

135.0127.1144.3136.5135.5132.1134.0136.0137.6146.2159.1

Five andten

(4 chains).

70.272.390.893.996.486.387.994.692.5

107.9112.1195.1

85.682.6

111.1110.6112.9108.9112.0111.1111.7129.9125.7214.6

86.192.9

121.1111.9112.2109.7108.0116.0113.4141.9134.1241.6

94.6100.8118.4134.9129.6124.9126.3130.4136.1156.6152.3

Chain stores.

Drug (7chains).

92.783.796.695.394.493.1

100.8101.598.5

104.6103.8135.0

114.9107.5117.2110.0115.8117.0123.8119.8119.4123.4114.2149.5

117.3110.7123.6121.8119.2120.6122.1119.8119.4124.2115.2146.1

117.0114.5123.2120.3122.9123.5125.7127.9128.*133.0122.3

Cigar (3chains).

74.877.093.791.7

102.192.298.299.996.2

110.2114.9149.0

106.8106.1120.3123.2135.6129.6137.3129.2136.6151.0133.9180.5

119.9116.5131.8134.7129.5127.8128.5127.6128.0138.0124.8172.7

111.0109.3124.3124.5128.8105.8127.3126.9135.4127.1126.9

Shoes (5chains).

68.159.676.2

107.6103.392.488.6

104.0107.1128.8127.2136.9

90.176.2

121.6133.6146.6128.3119.891.6

111.7143.2135.2155.0

85.882.5

141.0139.7136.5127.6100.986.6

103.1135.4119.1149.6

80.080.7

102.0156.3127.1121.9101.386.8

117.8121.2122.0

Music (4chains).

65.378.289.786.081.675.776.286.9

105.6133.7127.3193.5

94.795.0

112.991.391.993.984.7

101.6118.7126.6132.1179.1

79.078.381.975.165.159.965.671.682.399.2

107.0172.6

71.775.080.678.980.981.383.099.1

118.2118.8120.7


JANUARY, 1923. FEDERAL EESERVE BULLETIN. 105

CONDITION OF WHOLESALE TRADE.

PERCENTAGE OF INCREASE (OR DECREASE) IN NET SALES IN NOVEMBER, 1922, AS COMPARED WITH THE PRECEDINGMONTH, OCTOBER, 1922.

District.

No.2No.3No.4No. 5.No. 6. . .No.7No.8No.9No. 10No. 11No. 12

Groceries.

Percent.

0.61.54.6

—.4

- 3 . 0- 3 . 3- 2 . 1- 6 . 3

-13.17.8

Num-ber offirms.

426427

Dry goods.

Percent.

-12.6- 6 . 5—8.R

47 — 13. n35 —19.634 —13.914568

1230

- 9 . 6—15.5-16.5-28.4

2.6

Num-ber offirms.

8231416259663

1115

Hardware.

Percent.

- 3 . 6- 4 . 6- 3 . 2- 2 . 0- 6 . 5

-10.9- . 3

- 9 . 6- 9 . 0

-10.1- 4 . 3

Num-ber offirms.

1135121726163

157

1221

Boots andshoes.

Percent.

-11.7- 7 . 6

- 9 . 8-21.3-19.0-13.6- 1 . 7

- 4 . 8

Num-ber offirms.

1013

2012129

14

Furniture.

Percent.

Num-ber offirms.

1.6- 1 . 4

919

-10.9

4 6

32

16

Drugs.

Percent.

—13.5- 3 . 3—2.1

1.1—.8

- 9 . 7- 6 . 0

—14.0-14.2—4.3

Num-ber offirms.

61614144

103

48

10

Auto sup-plies.

Percent.

-13.4

-17.9

- 3 . 5

Num-ber offirms.

Stationery.

Percent.

—11.3

7

2

- 1 . 3

18 \ - 9 . 2

Num-ber offirms.

6

3

28

Farm im-plements.

Percent.

Num-ber offirms.

—11.8 x43.5- . 523 8 23

PERCENTAGE OF INCREASE (OR DECREASE) IN NET SALES IN NOVEMBER, 1922, AS COMPARED WITH NOVEMBER, 1921.

District.

No.2No.3No.4No.5No.6No.7No .8 . . . .No.9No. 10..No. 11No .12.

Groceries.

Percent.

16.710.111.17.2

21.46.48.3

13.78.4

29.024.4

Num-ber offirms.

42642747353414568

1230

Dry goods.

Percent.

9.310.214.721.026.06.8

35.210.34.08.4

19.3

Num-ber offirms.

8231416259663

1115

Hardware.

Percent.

22.225.425.319.015.924.324.520.313.82.2

24.9

Num-ber offirms.

1135121726163

157

1221

Shoes.

Percent.

- 6 . 419.0

6.0-10.2- 9 . 9

6.920.4

17.1

Num-ber offirms.

1013

20121296

14

Furniture.

Percent.

27.122.7

16.826.815.2

Num-ber offirms.

919

32

16

Drugs.

Percent.

14.07.77.3

16.222.913.2

- 2 . 3

- 5 . 01.3

10.9

Num-ber offirms.

61614144

103

48

10

Autosupplies.

Percent.

93.4

12.4

12.2

Num-ber offirms.

7

2

IS

Stationery.

Percent.

5.6

Num-ber offirms.

6

j

45.6 i 3

22.4 28

Farmimplements.

Percent.

37.3110.9146.616.7

Num-ber offirms.

835

23

Auto tires.

Percent.

4.3

Num-ber offirms.

16


106 FEDERAL RESERVE BULLETIN. JANUARY, 192:1.

BANKING AND FINANCIAL STATISTICS.DISCOUNT AND OPEN MARKET OPERATIONS OF FEDERAL RESERVE BANKS.

VOLUME OF OPERATIONS DURING NOVEMBER. 1922.

Federal reserve bank.

BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...:Kansas CityDallasSan Francisco

Total: November, 1922November, 192111 months ending

November 30,1922..11 months- ending

November 30,1921..

Bills dis- | tcounted for I Bills bought in !

member I open market, jbanks. i

United States securitiespurchased.

Bonds andnotes.

Munic-ipal war-

rantsCertificates | pur-of indebted- [ chased,

ness. !

$330,1,703,

251,179,150,45,188,108,12,30,13,134,

811,292058,213390,183572,807202,195776, S48976,455448,73S535,539628,842472,283902,221

$29,648,40258,712,7016,611,72425,117,050

$3,481,10040,417,800 i

13J800

$1,291,210 .9,803,500 j.

74.5,0003,646,76415,012,8817,515,195

""so9,'666'6,907,25220,622,082

628,000

199,2504,520,400

28,4002,176,600

'425,'566""

200,0005,545,000

30,000150,0005,000

83,000

3,155,775,6163,231,270,854

18,767,295,334

53,590,561,720

175,378,051161,998,551

1,752,120,698

1,304,299,407

51,382,850 ; 17,652,710 I 3,000

9,183, 200 i 122,676,000 \ 663,486

1,120,217,500 , 2,559,178,210 j 152,832

OS, OSS, 250 3,307,556,557 i 673,095

Total.

November,1922.

$365,232,00!1,811,992,214258,136,207205,317,857150,947,19549,822,862

214,084,736116,022,33314,865,13937,442,84220,804,533155,524,303

November,1921.

$348,1, 538,288,261,200,111,250,151,49.68,53.203,

527,045318,774992,271617,152050,166240,449409,880381,290844,098476,080515,388418,898

3,400,192,227

24,204,964,574

3,525,792,091

58,271,174,029

VOLUME OF BILLS DISCOUNTED DURING NOVEMBER. 1922, BY CLASSES OF PAPER; ALSO NUMBER OF MEMBERBANKS ACCOMMODATED.

I Customers' i Member banks' collateral ij t e ;notes.


paper se- ji cured by I •! Govern- I Secured by| ment obli- j Government ;i gations. [ obligations. I

j Commercial' PaPer> n- e- s-

Bankers' acceptances.

Agricul- } Live-stock ;tural paper.! paper.

Foreign. Domestic.

Dollar ex-change.

BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan Francisco.

Total: November, 1922.October, 1922...November, 1921,October, 1921...

$318,500900,509 I251,150 I346,984131,170216,136246,332 !121,844 i6,169 i53,458 :

275 I88,900

$132,120,400 ,1,511,099,300 [

156,644,050 i134,111,450 I131,985,96912,859,650 1

136,240,210 !94,514,950 !4,005,525 !

25,136,125 i5,757,500

64,166,522

$38,0001,321,000

266,05658,430

'802,'045'

2,681,427 1 2,408,641,6513,792,661 I 1,495,246,596

41,791,53045,023,385 |

1,888,859,3301,826,563,751

507,15116,802,258

$197,745,401189,599,87894,147,56643,446,00014,014,08228,170,43642,331,01711,242,8333,485,6%5,974,2963,581,39251,569,465

19,794,94021,907,27235,352,23335,224,090

685,308,062610,030,580

1,177,681,7661,498,064,426

Trade acceptances.

$373,161 ;456,220 I271,095 j .241,547 I

2,242,3403,497,6179,985,656 |.1,426,0543,295,815 i1,646,387 !1,938,887 I

878,859 j

$14,500 i.2,953 I $35,000

238,79271,048

191,969

50,594938,682 I.

3,816,799 !.1,548,055 I

685,064 I

225,000 $310,000

258,187 I 178,943

26,253,638 7,558,45628,238,469 I 9,268,97756,521,118 22,574,63550,197,467 20,665,438

518,18773,550

488,943 i437,828 I $2,700


Foreign.

BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicagoSt LouisMinneapolis...Kansas City. . .DallasSan Francisco.

$822,140

Total: November, 1922 ] 822,140October, 1922 | 461,300

Domestic.

$239,330142,21376,322

1,150,034436,586574,984114,810557,463

1,6071,777

139,023274,023

Total reduced to a commonmaturity basis.*

Total all — ;classes.

Amount.Per cent of

total.

3,708,1722,654,172

November, 1921.October, 1921

7,849,9209.681,170

$330,811,292 i1,703,058,213 !2ol,390yJ83 j179,572,807150,202,195 145,776,848 .188,976,455 i108,448,738 i12,535,53936,628,84213,472,283 I

134,902,221

$419,998,970733,050,441215,979,056193,852,676150,147,157210,391,437586,105,077135,975,20496,402,205155,452,03775,526,072

182,895,284

3,155,775,6162,172,114,105 |.3,231,270,8543,489,268,197

3,155,775,616

13.3123.236.846.144.766.6718.574.313.054.932.395.80

100.00

640,3223,848,470

Member banks.

Number indistrictNov. 30.

428806714881633543

1,443608

1,0141,154

863829

9,9169,9189,8369,813

Accommodated.

Number. Per cent

230341338311289230788211350330175

3,8593,7935,6225,572

53.742.347.335.345.742.454.634.734.528.620.332.1

38.938.257.756.2

1 Total discounts multiplied by ratio of average maturity of bills discounted by each bank to average maturity (8.43) for system.


JANUARY, 1923. FEDEKAL RESERVE BULLETIN. 107

VOLUME OF BILLS DISCOUNTED DURING NOVEMBER, 1922, BY RATES OF DISCOUNT CHARGED; ALSO AVERAGE RATESAND MATURITIES.


BostonNew York. .PhiladelphiaCleveland . .Richmond .Atlanta.Chicago . . . . .St. LouisMinneapolis. .TCansasCityDallas...San Francisco

Total: November, 1922.October, 1922

4 per cent.

$330,811,2921 703 058 213

134,902,2212,168,771,7261,417,609,155

4J per cent.

$251,390,183179 572 807150 202 19545 776 848

188,976 455108,448,73812,535,53936,628,84213 472 283

987,003,890754,504,950

Total.

$330,811,2921 703 058,213

251,390,183179 572 807150,202,19545 776 848

188,976,455108,448,73812,535,53936,628,84213,472,283

134,902,2213.155,775,6162,172,114,105

Averagerate (365-

day basis).

Per cent.4.004.004.504.504.504.504.504.504.504.504:504.004.294.34

Averagematurity.

Days.10.713.637.259.108.43

38.7626.1610.5764.8635.7947.2811.438.459.99

VOLUME OF BANKERS' AND TRADE ACCEPTANCES PURCHASED DURING NOVEMBER, 1922, BY CLASSES.



Foreign. [ Domestic.

BostonNew YorkPhiladelphiaClevelandRichmondAtlantaChicagoSt. LouisMinneapolisKansas CityDallasSan Francisco

Total: Nov., 1922..Oct., 1922..Nov.. 1921.Oct., 1921..

$16,982,43241,659,4114,948,955

20,544,855210,000

2,862,86411,022,8805,687,152

$12,165,75412,947,0851,387,7693,822,775

535,000783,900

3,870,0011,628,043

5,374.97514,446,141

123,739,665126,389,315114,452,17387,912,692

809,0001,532,2775,967,080

"45,448,68473,251,32837,001,46244,211,369

Dollarexchange.

$500,2163,288,000275,000695,000

150,000200,000

Total.

$29,648,40257,894,4966,611,724

25,062,630745,000

3,646,76415,042,8817,515,195

167,6005,275,8166,206,053

10,307,0716,957,264

809,0006,907,252

20,580,821"1747464,-165205,846,696161,820,706139,081,325

Trade acceptances.

Foreign. Domestic.| Total.

$818,205 $318,205

$54,420' '54,'420

Total.bills.

purchased.

$29,648,40258,712,7016,611,724

25,117,050745,000

3,646,76415,042,8817,515,195

Total reduced to a com-mon maturity basis.'

41^261 ! I 41,261"859,4661 547420~! 913,886625,515 I 143,325 : 768,840177,845 i ; 177,845

809,0006,907,25220,622,082^175,378,051206,615,536161,998,551139,081,325

Amount.

$15,707,21023,313,85812,301,32845,071,1411,296,5243,744,245

25,557,01312,869,806

1,371,373 I12,316,768

_21,8281785_175,378,051

Per centof total.

9.013.37.0

25.7.7

2.114.67.3

.87.0

12.5100.0

1 Total purchases multiplied by ratio of average maturity of bills purchased by each bank to average maturity (43.41) for system.

VOLUME OF ACCEPTANCES PURCHASED DURING NOVBMBEBRATES AND


Philadelphia

Atlanta

St. Louis

Kansas CityDallasSan Francisco

Total* November, 1922October, 1922


DallasSan Francisco

Total: November, 1922 .October, 1922

3 per cent.

$120,679

120,679176,125

3& per cent.

$10,366

10,366629,002

4 per cent.

$17,448,11856,276,1844,332,468

15,629,576489,000

1,574,9937,914,8936,769,287

6,077,8036,691,853

123,204,17525,429,905.

, 1922, BY RATES OFMATURITIES.

DISCOUNT CHARGED; ALSO

3} per cent. 13 j per cent, j 3J per cent., 3J per cent.! 3} per cent.

$16,483

16,48348,742,755

$105,928

$3,915 . .

$190,000 SI -7,099

38,625 j .

526,39611,255

1,500

AVERAGE

3

!25,000

j

105,92823,139,046

1

4J per cent, j 4J per cent.

i

$6,064,458250,375

1,616,3036,925,481

146,000

5,476,438600,523

792,8598,522,938

30,395,3753,187,138

$1,077,687556,16087,500

795,506

155,394120,385

36,590779,371

3,608,593467,564

42,540 | 197,69945,816,496 1 18,871,324

i

4 | per cent.

$73,603138,999

40,945253,54721,296

4J per cent.

$108,210818,205

3,400110,000

1,263,285

809,000

45,8573,157,9575,370,727

1,564,15123,036,490

Total.

$29,648,40258,712,7016,611,724

25,117,050745,000

3,646,76415,042,8817,515,195

809,0006,907,252

20,622,082175,378,051

1206,615,536

I per cent.

$3,233,533539,967501 850

1,618,673

808,4861 457 531

Averagerate

(365-daybasis).

Per cent.4.044.084.114.114.164.244.114.07

4.564.074.114.103.68

4,541,11812,701,15811,721,968

Averagema-

turity.

Bays.23.0017.2480.7677.8975.5444.5773.7574.34

73.5877.4045.9543.4146.23

1 Includes $5,700 of acceptances purchased at 4i per cent.NOTE.—All Federal reserve banks use 360 days to the year in calculating interest on bills bought in open market.



HOLDINGS OF EARNING ASSETS, BY CLASSES.

AVERAGE DAILY HOLDINGS OF EACH CLASS OF EARNING ASSETS. EARNINGS THEREON, AND ANNUAL BATES OFEARNINGS DURING NOVEMBER, 1922.


BostonNew York. . . .Philadelphia-ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis..Kansas City..DallasSan Francisco.

Average daily holdings of—

All classesof earning

assets.

$116,235,113238,861,102102,000,412126,908,50548,898,82553,549,673

136,357,83662,877,03333,847,32470,295,59148,724.262

121,569,917

Dis-counted

bills.

Pur-chasedbills.


Earnings on-

$62,821,378|S30,662,397i$22161,976,02468,835,942 58;53,514,51517,601,24446,374,419 45,956,83942,953,207

Total: Nov., 1922 1,210,125,593) 623,825,598 259,978,591 [326,294,504 3,980,435 2,198,846Oct., 1922 1,184,700,479 484,443,599 251,618,886 448,615,722 3,902,715 1,794,655!

Nov., 1921Oct., 1921

2,161,38536,170,99513,258,6471 4,82,142,108 13,767,355! 40,29,775,22710,621,808 22,21,342,013 . . . . I 12,28,903,856 571,9671 40,16,878,97518,863,412 12,40,972,88137,677,595! 42,

751,3381049,136:884,653!,577,247!784,233120,031448,373479,998478,411819,768981,875919,441

Allclasses

ofearningassets.

$366,277902,115351,598423,816172,788180,305459,293216,003120,385241,840157,835388,180

1,520,283,2451,232,575,771 78,867,348 208,579,059 6,237,929 5,459,506J1,640,739,5111,376,914,379 56,196,411 207,624,721 7,318,159J6,658,343

Dis-counted

bills.

$206,727532,626197,864171,519158,868129,335303,906110,13180,897

107,99463,841

135,138

Pur-chasedbills.

$90,204195,03550,223

140,8067,551

41,41339,02232,735


2,145|59,537

108,597

$69,346174,454103,511111,491

6,3699,557

116,36573,13739,387

131,701|34,4571

144,445i

Annual rate of earnings on—

Allclasses Dis-

of 'countedearning bills.

Perct. Perct.4.004.004.504.504.504.504.504.504.614.554.604.01

3.~i3.8114.19;4.064.304.244.10!4.184.334.193.943.89!

767,2681,014,220692,798!1,415,176'

318,5281 458.8031

240,400 419,396:

4. OOi3.881

4.99!5.25!

4.294.36

5.395.

Pur-chasedbills.

Per ct.3.583.453.473.724.253.933.453.75

4.563.843.51

3.593.24

4.915.04


Per ct.3.713.674.073.922.052.923.503.963.843.933.234.10

3.783.71

2.682.38

NOTE.—The figures in the first, fifth, and ninth columns include average daily holdings of municipal warrants, earnings, and annual rate ofearnings thereon, as follows: Minneapolis, $26,900, $101, and 4.56 per cent.

HOLDINGS OF DISCOUNTED BILLS, BY CLASSES.

[End of November figures. In thousands of dollars.]

i

Federal Reserve Bank. Total.

! Custom-i ers'

papersecured

byGovern-

mentobliga-tions.

BostonNew YorkPhiladelphia..ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City. . .DallasSan Francisco.

77,121137,02257,31754,60647,21737,51393,10931,26121,88328,85815,05649,133

Total: Nov. 29,1922 !Oct. 31,1922 1

Nov. 30,1921Oct. 31,1921

650,096576,435

1,182,301 !1,313,027

716447239660360311339209

1511111

117

Member banks'collateral notes.

Securedby

Govern-ment

obliga-tions.

Other-wise

secured.

Com-mercialpaper

n. e. s.

3,5353,265

48,89649,485

27,272108,48738,39733,71619,5104,108

33,75215,2941,8967,64ft1,068

20,599

' 48,021: 27,323

18,09015 j 17,901

528 i 20,662152 I 24,95827 ; 28,842

; 11,214483 ; 4,327

! 7,007254 I 2,820

8,047 14,085

311,745265,777

427,464 |412,951 !

9,50610,266

17,35017,553 i

225,250188,777

486,313621,900

831466 i437 i690 :

5,225 i7 027

29,737 !3,436 j

10,1084,9602,518 I3,612 j


Agricul- \ Live-tural i stock

paper. . paper. ! F o r _eign

Do-mestic.

Dol-larex-

| change

Tradeacceptances.

For-eign.

19 ;35 75

566 I146 I276 I

150 !4,8449,1308,3711,983

73

247 114

Do-mestic.

262183154

1,058786681412885210

414

329

69,047 | 25,485 ;

74,804 28,533 ;

139,164 ' 51,715141,923 ! 57,154

28274

55570

193 :275

392304

75!297;

25

4,9784,364

10,93611,108


JANUARY, 1923. FEDERAL RESERVE BUT,T,KTIN. 109

HOLDINGS OF BANKERS' AND TRADE ACCEPTANCES PURCHASED OR DISCOUNTED, BY CLASSES OF ACCEPTANCES.


All classes. Bankers' acceptances.

Federal reserve bank.Total.

Pur-chasedin openmarket.

Dis-countedfor mem-ber banksl

Total.

Boston I 29,093New York ; 56,674Philadelphia i 19,479Cleveland i 55,349Richmond ; 2,969Atlanta i 13,181Chicago ! 12,689St. Louis | 12,543Minneapolis I 210Kansas City j 406Dallas I 21,167San Francisco I 40,994

Total: Nov. 29,1922 | 264,754Oct. 31,1922 | 263,178Nov. 30, 1921 i 84,353

Purchased in open market: iNov. 29,1922 'Oct. 31,1922 iNov. 30,1921

Discounted for member banks: iNov. 29,1922 'Oct. 31, 1922 1Nov. 30, 1921 j

28,83156,37519,32554,2912,183

12,50012,27711,585

40221,15340,304

262299154

1,058786681412958210

414

28,83154,96319,32554,1872,183

12,50012,27711,658

Foreign.

15,96342,58811,45641,556

670

9,6808,302

402 I21,153 !40,624 i

14,62030,271

259,226258,16572,954

258,103 i257,186 j73,271

257,628256,83472,824

183,786181,079

Domes-tic.

Dollarexchange

10,8069,7327,579 I

11,151 I1,513 I3,8202,3493,136

2,0622,643290

1,480

4025,14410,052

183,504 !181,005 j48,934 !

65,68467,30820,019

65,491 !67,033 |19,627 |

Trade acceptances.

Total. ! Foreign.

248220 i

1,389301

2621,711

1541,162

786681412 |885 !210 ;

4 114 !

370 !

1,383262328154

1,162786681412885210

414

329

8,633 !8,799 i4,263 !

8,796 :4,263 '

6,6515,99211,082 i

1,598 '1,331130

1,4241,336146

1,3491,039130

5,2274,65610,936

249292

5,5285,01311,399

475 ,352 |447 i

i

282 i74 |55

193275392

3 ;5,0534,66110,952

7529716

4,9784,36410,936

HOLDINGS OF BANKERS' ACCEPTANCES PURCHASED OR DISCOUNTED, BY CLASSES OF ACCEPTING INSTITUTIONS:


BostonNew YorkPhiladelphia..ClevelandRichmondAtlantaChicagoSt. LouisMinneapolis...Kansas City. . .DallasSan Francisco.

Member banks.


Total: Nov. 29,1922Oct. 31,1922Nov. 30,1921

Purchased in open market:Nov. 29,1922Oct. 31,1922Nov.30,1921

Discounted for member banks:NOT. 29,1922Oct. 31,1922Nov. 30,1921

Total.

28,83154,96319,32554,1872,183

12,50012,27711,658

40221,15340,624

258,103257,18673,271

257,628256,83472,824

475352447

National.

15,17318,3687,557

16,7161,2931,6635,6873,915

4027,35615,939

Non-! memberj banks and

Non banking„ V-° i corpora-national, j t i £ n s

9,53217,4886,95020,268

5266,4465,9155,227

3,038 :7,7552,1006,168

4,391571

1,472

Privatebanks.

4648,1031,5127,614361

8,28411,169

94,06996,182 |30,289 I

93.736 I96,075 I30,208

33310781

91,80594,23823,579

91,79094,03923,282

15199297

2,7364,547

32,778 •32,148 I8,942 I

32,778 i32,144 I8,873 i

584

1,5454,448

24,63420,734

4,960

24,62920,7054,960

529

Branchesand

agenciesof foreign

banks.

6243,2491,2063,421

104460

1,2324,521

14,81713,8845,501

14,69513,8715,501

12213


110 FEDERAL KESEKVE BULLETIN. JANUARY, 1923.

BANKING CONDITIONS, BY FEDERAL RESERVE DISTRICTS.

Between November 15 and December 20loans and discounts of reporting memberbanks in leading cities increased by $48,000,000.Increases are shown for the New York, SanFrancisco, Cleveland, Richmond, St. Louis, andKansas City districts, while the other districtsshow reductions, the largest of which, amount-ing to $20,000,000, is shown for Boston. Asa result of the Treasury operations on Decem-ber 15, member banks in all the districts showincreases in their holdings of Governmentsecurities, the aggregate increase amountingto $273,000,000, of which $116,000,000 is re-ported for New York City members alone.Only moderate changes are shown in memberbank holdings of corporate obligations, NewYork City banks showing a reduction of$11,000,000 and Chicago banks an increase of$15,000,000 for the period. Demand deposits

increased in all the districts except Boston,Cleveland, Richmond, Dallas, and San Fran-cisco, the largest increase, amounting to$62,000,000, being shown for the New YorkCity banks. Time deposits also increased, thelargest addition, amounting to $44,000,000,being shown for the Cleveland district. Mem-ber banks in New York City show a reductionof $26,000,000 in time deposits.

Accommodation at the reserve banks wasreduced by $52,000,000 during the period,smaller figures being shown in eight of thetwelve districts. The reduction for the mem-ber banks in New York Citv alone was$61,000,-000,

Following is a table showing the increasesand decreases in the principal assets andliabilities of reporting member banks for thefive weeks under review:

CHANGES IN PRINCIPAL RESOURCES AND LIABILITIES OF REPORTINGDISTRICT BETWEEN NOVEMBER 15 AND

Federal reserve district.

Boston

New York City. .. .

Cleveland

Atlanta

St. LouisMinneapolisKansas CityDallasSan Francisco

Total

Loans anddiscounts.

In-crease.

2726

2714

10

5

20

48

De-crease.

20

4

41321

6

8

United StatesGovernmentsecurities.

In-crease.

6126116182558

4329872

1213

273

De-crease.

MEMBER BANKS I>DECEMBER 20, 1922.

Other bonds,stocks andsecurities.

In-crease.

113

116151

3

21

De-crease.

16

11

1

6

Demanddeposits.

In-crease.

n629

2S2616

I

60

De-crease.

15

152

1225

EACH FEDERAL RESERVE

Timedeposits.

In-crease.

144

64

2

o7

35

De-crease.

42426

3

Accommoda-tion of Federalreserve banks.

In-crease.

9

5

5

6

1

De-crease.

1060615

31

1

52

Changes in the condition of Federal reservebanks between November 22 and December 27were caused partly by the requirements of holi-day trade. Total cash reserves decreased by$64,800,000, smaller figures being shown for allFederal reserve banks except Cleveland, At-lanta, and San Francisco. These decreaseswere caused largely by the demand for goldand currency for Christmas presents andChristmas shopping. This demand is alsoreflected in an increase of $164,700,000 in Fed-eral reserve note circulation, an increase inwhich every district except Dallas partici-pated. As a consequence of the reduction inreserves and the increase in note circulation,

with deposits showing but moderate changes,the reserve percentage of the reserve banksdeclined from 76.7 per cent on November 22to 72.1 per cent on December 27. Reducedratios are shown for every Federal reserve bank,except Atlanta.

Changes in discounts at the reserve banksfor the period were relatively slight. TheNew York reserve bank reported a reduc-tion of $16,200,000, the Atlanta bank one of$7,500,000, smaller reductions being shownalso for the Minneapolis and Dallas banks. Onthe other hand, the largest increase, amount-ing to $11,800,000, is shown for the Richmondbank, and smaller increases were reported


JANUARY, 1923. FEDERAL EESEKVE BULLETIN. I l l

for the remaining seven banks. Governmentsecurity holdings of the reserve banks in-creased by $162,800,000 during the five weeks,larger figures being shown for all banks exceptAtlanta and Dallas.

Following is a table showing the increasesand decreases of the principal items in theFederal reserve bank statement between No-vember 22 and December 27:

CHANGES IN PRINCIPAL RESOURCES AND LIABILITIES OF EACH FEDERAL RESERVE BANK BETWEEN NOVEMBER 22AND DECEMBER 27, 1922.


New York.. . .Philadelohia

DallasSan Francisco

Total

[Amounts m millions of dollars.]

Total reserves.

In-crease.

18.1

7.3

1.5

De-crease.

7.237.6

2.2

17 0

7.4

3.97.0

64 8

Discounts.

In-crease.

6.3

6.38.1

De- 'crease.

16.2

11. 8 |7.5

3.22.1

1.9

1.0

15.7

. 3

1.0

Governmentsecurities.

In-crease.

12.867.212.45.04.9

41.79.42.01.0

9.3

162.8

De-crease.

1.5

1.4

Total deposits.

In-crease.

1 69.9

1.111.48.0

3.1

10.3

De-crease.

1.818.6

. 9

. 1

3.2. 2

Federal reservenotes in

circulation.

In-crease.

17.618.8

De-crease.

21 5 '•29 86.5

32.0 1.3.4 i2 93.5

24.21.0

164. 7

Eesenceni

Nov.22.

68.382.976.773.573.174.882.369.875.962.461.370.8

76.7

re per-age.

Dec.27.

62.980.070.770.860.276.176.159.873.857.356.766.7

72.1

CASH RESERVES, TOTAL DEPOSITS, FEDERAL RESERVE NOTE CIRCULATION, AND RESERVE PERCENTAGES FORDECEMBER AND NOVEMBER, 1922.

[Daily averages. Amounts in thousands of dollars.]


Philadelphia.

St. Louis .

Dallas .San Francisco

Total- 192219211920 . .1919

Total cash reserves.

December.

217 5401,040,668

240.579277 021110 658140 169540 243111 677SI 77289,82553 184

262,683

3,166,0192,994,9822,221,5732,149,653

November.

213,0061,079,813

23(1,862274,568i18,164135,483549,879113,89580,63193,03<i60,207

253,165

3,208,7522,964,4192,182,7952,185,149

Total deposits.

December.

126,318717,518111,717148,00960,25754,870

269,74871,46450,26785,35755,819

140,083

1,891,4271,755,2261,821,7401,990,221

November.

127,020724,217111,875147,63861,70354,690

265,78707,84948,80183,31357,302

139,827

1,890,0221,732,5041,830,0112,013,944

Federal reserve notes' in circulation.

December.

205,408600,336218,185245 797101,149126 993416,25095,77058,66170,46039,559

236,947

2,415,5152,416,0903,342,5202,956,470

November.

194,925594,222203,403228,59197,106

125,294397,49094,57457,12068,60141,858

221,615

2,324,8652,402,4423,327,6322,812,247

Eeserve percentages.

December.

65.679.072.970.368.677.178.866.875.157.755.869.7

73.571.8

!«.7'45.7

November.

66.281.975.173.074.475.382.970.176.161.260.870.0

76.171.7

M3.7M6.8

1 Calculated on basis of net deposits and Federal reserve notes in circulation.



CONDITION OF FEDERAL RESERVE BANKS.

RESOURCES AND LIABILITIES OF EACH FEDERAL RESERVE BANE ON WEDNESDAYS, NOVEMBER 29 TO DECEMBER

27, 1922.

RESOURCES.


Gold and gold cer-tificates:

Nov. 29Dec.6Dec. 13Dec. 20Dec. 27

Gold se t t l ementfund—F. R. Board:


Gold with F . R.agents:

Nov.29Dec.6Dec. 13Dec. 20Dee. 27

Gold redemptionfund:

Nov.29Dec.6Dec. 13Dec. 20Dec. 27

Total gold reserves:Nov.29Dec.6Dec. 13Dec. 20Dec. 27

Legal-tender notes,silver, etc.:


303,219298,094304,810291,081273,825

644.959616,574596,851582.494509,580

2,048,0842,045.2102,103.0692,117,6882,198,846

Total reserves:Nov.29Dee. 6Dec. 13Dec. 20Dec. 27

Bills discounted:Secured by U. S.

Governmentobligations—


Other bills dis-counted—


Bills bought in openmarket:


TJ. S. bonds andnotes:


Total. Boston.

76,59685.91456,49354,64758,188

3,072,8583,045,7923.061.2233,045,9103,040,439

129.952127,189123.665110,799108,398

3,202,8103,172,9813,184,8883,156,7093,148,837

315,280374,409344,793314,851316,495

334,816330,536314,965300,707313,390

259,226266,827262,572251,728246,293

162,336169,413170,020174,958179,192

19,13919,13817,47116,61615,984

33,48547,87143.93733,12428,822

127,708125.191141,718143.119150,228

15,46017,0579,64512,4149,074

195,792209.257212.771205.273204,108

12,60510.73610,5038.8427.937

208,397219,993223,274214,115212,045

27,98825,06822,70223,54325,036

49,13343,28940,43936,98644,935

28,83128,60228,36527,10025,706

5,9115,9125,4666,3957,282

NewYork.

168,961138,893145,468129,803121,730

224,522194,562190,228223,249186,672

659,850659,653659,409659,225709,059

12,25710,7389.1567,627

10,919

1,065,5901,003.8461.004.2611,019.904l,028,3S0

31.98332.16229.74226,29227,602

1,097,5731,036,0081,034,0031,046,1961,055,982

108,934177,085160,669126,029125,487

28,08830,96123,21316,32719,323

56,37558,92551,22441,22545,789

28,85335,26436,17339,51841,497

Phila-delphia.

6,42027,25426,95426,39619,256

45,49521,40025.86113,87112,909

165,487169.761172,299180,371186,110

5,0816,6044,0305.9944,925

222,483225.019229.144226,632223,200

14,53514.63514,61313.60713,887

237,018239,654243,757240,239237,087

38,63639,34636,95540,54539,618

18,68118,33415,87313,15114,020

19,32519,41320,25521,65522,817

23,98723,98723,98724,09624,325

Cleve-land.

13,82613,79813,59313,31213,338

65,67867.00763,96368,67884,638

181,157181,479181,226181,466183,0S6

4,6853,7164,0464,1274,764

265.346266,000262.828267.583285,826

8,1356,8925.8985,5655,050

273,481272,892268,726273,148290,876

34,37624,79231,24128,45928,147

20,23022,34522,37522,37122,534

54,29160,1816i;56858,97553,302

11,85211.89611,89611,89611,896

Rich-mond.

5,0585,2065,5875,4935,549

31,91234.11827,90423,70614,583

66,31964,75967,89966,11865,003

5,1865,7763,4423,9224,061

108,475109.859104.83299.23989,196

9.7698.9109,1138.3539,329

118,244118,769113,945107,59298,525

19,87019,16220,87520,49625,024

27,34725,79028,32030,93931,813

2,1832,0371,9691,6591,614

1,2411,2411,2411,2411,241

Atlanta. Chicago,

5,6295,6285,6595,5675,542

23,21825,77025,63925.55224,769

96,625100,961100,64499.631103,668

2,2092,2501,7012,0912,489

127,681134,609133.643132.841136,468

5,7306,6216.3155,8884,936

133,411141,230139,958138,729141,404

4,4194,2093,9373,8683,036

33,09427,72126,75628,19426,632

12,50011,59211,38611,60810,579

163544165179143

41,62645,40747,17151,53350,724

92,53783,88790,99680,12147,795

360,835384.314390,117405,216

19.01026,39811,2393.9967,542

522,671516.527533,720525,767511,277

20,15920.87621.00619,67918,575

542,830537,403554 726545,446529,852

34,09139,87031,78730,78829,106

59,01862,71556,36653,00258,994

12,27711,4918,55310,16811,762

6,3097,0146,3476,4357,270

St.Louis.

Minne-apolis.

I

3,2173,2183,1682,8442,443

17,94025,62422,457

7,6457,6507,6297,5897,581

24,81030,02422,790

16,969 25,61617,433 I 22,493

76,529 i73.85376.51974,51372,522

3.1103,1432,7493,0882,345

100,796105.838104,89397,41494,743

10,24110.28911,0488,836 .8,158

111,037116,127115,941106,250102,901

15,50313,83913,45113,69616,549

15,75815,95214,25815,09913,638

11,58512,43912,66012,68012,623

16,76516,76516,76516,76716,765

42,70144,05143,73644,82246,372

2,8343,1303,0043,5253,593

77,99084,85577,15981,55280,039

1,010712706872

79,00085,56777,86582,42480,842

1,9111,9852,0912,1562,177

19,97219,46019,20819,27518,902

KansasCity.

9,7599,594

10,38510,60811,109

2,7702,7902,7352,6872,661

30,36430,17632,78125,01429,405

53,70252,90852,62850,74352,250

1,7222,1821,9782,3362,323

88,55888.05690,12280,78086,639

4,8634,6684,3143,2453,160

93,42192,72494,43684,02589,799

7,7579,8939,13611,7519,767

21,10121,83322,20922,31520,669

402402402602402

26,92526,92527,32527,57727,418

Dallas.

9,7609,850

10,06510,06010,046

14,14811,5518,081

13,83312,657

25,48725.99425,40422,44422,587

1,3981,2431,2331,4841,789

50,79348,63844.78347,82147,079

6,8086,5906,3666.3326,092

57,60155,22851,14954,15353,171

1,079753776

1,523992

13,97713,77713,71813,955 i13,208 I

21,15322,94224,82724,95923,397

2,9512,6542,6532,6292,629 !

SanFran-cisco.

19,16819,26219,31019,18118,971

40,85044,58442,21432,76127,404

183,021185.765197,273205,119202,745

3,6443,6774,2704,0434,364

246,683253,288263,067261,104253,484

4,1144,0984,0413,2882,869

250,797257,386267,108264,392256,353

20,71618,40711,17311,99711,556

28,41728,35932,23029,09328,722

40,30438,80341,36341,09738,302

27,61727,61727,61727,61737,617



RESOURCES AND LIABILITIES OF EACH FEDERAL RESERVE BANK ON WEDNESDAYS, NOVEMBER 29 TO DECEMBER

27, 1922—Continued.

RESOURCES—Continued.


Total. Boston.

118,625 | 12,564 i120,889 12,357 I118,718 ! 12,144 i242,282 J 24,069 ;266,691 ! 24,054 ;

U. S. certificates ofindebtedness:

One-year certi-ficates (Pitt-man Act)—

Nov. 29 1 23,500Dec. 6 1 21,500Dec. 13 ! 18,500 jDec. 20 14,000 'Dec.27 12,000 :

O t h e r certifi-cates—

Nov. 29Dec.6Dee. 13Dec. 20Dec.27

Municipal warrants:Nov.29Dec.6Dec.13Dec. 20Dec.27

Total earning assets:Nov.29.;Dec.6Dec. 13Dec. 20Dec.27

Bank premises:Nov.29Dec.6Dec. 13Dec. 20Dec.27

5 per cent redemp-tion fund againstF. R. bank notes:

Nov.29Dec.6Dec. 13Dec. 20Dec.27

Uncollected items:Nov.29Dec.6Dec. 13Dec. 20Dec.27

All other resources:Nov.29Dec.6Dec. 13Dec. 20Dec.27

Total resources:Nov.29Dec.6Dec. 13Dec. 20Dec.27

1,2501,2501,250

750750

New i Phila- Cleve-York. ! delphia. land.

Rich-mond.

5,5004,5004,000 ]3,500 '3,000 !

24,590 j24,963 I23,143 i85,450 j72,190 !

1,5001,5001,000500500

I1,1

000000000500500

1,9601,9601,3601,3601,360

Atlanta,

1,4991,499

999999

Chicago

11

2,1672,1672,1671,6671,667

St.Louis.

2,0711,5711,571

571571

Minne-apolis.

4,1484,1484,148

10,74717,750

13,83313,82313,82317,827 i 2,00019,827 6,000

2,0312,0312,031 .2,031 !

2,031 !

31,47733,58033,74055,72670,452

2,8742,8742,7808,78013,781

24 !26 I34 !2610 i

1,213,807 i1,283,600 jil, 229,602 !11,298,552 I1,334,101 !

46,282 |46,394 :46,455 |47,181 !47,227 !

3,130 :2,7802,680 12,625 :2,520

599,826660,119709,289759,392757,500

15,050 !15,379 I15,729 '14,840 I15,226 I

5,080,905 i5,181,253 i5,188,643 j5,279,2995,305,411 !

125,677116,478110,366 '118,843 1127,763 |

5,252 |5,251 |5,251 I5,251 !5,251 '

422 '422 j422 i422422 I

49,886 !60,665 I68,766 j71,75873,504 |

478 •495508416446

390,112403,304408,587410,805419,431

252,340 ! 106,277 1331,698 i 106,728 !298,422 j 102,218 I312,049 ! 110,694 ;307,286 I 119,030

10,325 !10,32510,325 i10,744 :10,760;

2/4224199174149

624624639639 '639 :

25075757575 ,

135,582 I134,037141,903 !140,028 i136,206 !

6,882 l

6,937 16,970 !7.042 '7.043 !

52,60150,19053,76557,69567,052

2,5712,5712,5712,5712,571

124,770 49,398139,803 50,904 ;157,056 ! 58,926163,328 ' 63,723 j154,328 i 58,364

8989 j

59,319 '60,77564,11770,93174,612

12398986868

55,98857,76959,43061,78158,543

1,769 i1,810 ;

2,0371,875 i2,175 |

1,487,0511,519,868

! 1,502,04211,534,366il, 530,680

646 i 693 i669 : 780 !692 | 766 i431 721432 527

i394,213 I 476,046398,654 I 475,510406,307 482,571415,801 j 491,959415,627 ! 509,353

1,5001,5001,5001,000500

499499499

1,4992,499

KansasCity.

1,3211,3211,321

821821

Dallas.

1,9001,9001,0001,000500

SanFran-cisco.

10,94610,95110,95113,69412,647

8,3108,3108,3108,3108,310

1,8321,3321,3321,3321,332

7,3537,3537,149

12.14917.150

53,70647,59645,28246,87942,920

1,9881,997 |2,0072,1082,110 |

145,339 i156,837 I138,980 j157,786 :179,251 S

7,766 •7.765 |7.766 '7,781 !7,781

64,556 j63,440 I61,48567,593 !73,927 >

971 ;971 !971 j971971

33,66533,06433,70934,56435,227

1,0201,0201,0201,0421,057

468408468 :468 '468 '

22,785 I28,116 i29,552 j31,75433,340

665665665665665

81,85280,267 I87,572 j99,051 i93,849

103 i103 '»03103 :23 ;

37,91643,75943,95548,62750,454

196196196 I196196

16,54119,52318,64819,82319,362

68,45271,32571,34476,76071,724

5,1365,1365,1365,1695,169

300200200200 |200 !

49,373 | 126,23950,336 I 121,87151,284 120,86452,37649,036

2,0942,0942,0942,0952,095

146 i146 '146 !146 j146 !

123,285124,679

1,6531,7031,7051,7681,780

949419191?

40,888 : 25,083 j 35,40044,333 i 27,850 i 46,35543,913 | 29,705 47,64949,44651,577

28,59429,741

50,57659,826

528533530533696

230,055229,930230,339230,240227,455

235349304342354

212,593219,756217,571220,280220,596

720772795841892

779,172783,709790,484811,570812,290

489501512385379

215,072224,901222,967223,929228,655

1,7431,6791,7101,6851,731

132,165141,049133,148139,734138,415

874913965846845

209,071214,631215,994216,446219,314

1,9261,9131,9221,8171,856

136,223137,567136,300139,181136,045

4,9494,9654,9884,9484,893

419,132432,374442,333444,988«7,550



R E S O U R C E S A N D LIABILITIES OF EACH FEDERAL RESERVE BANK O N W E D N E S D A Y S , N O V E M B E R 29 TO D E C E M B E R

27, 1922—Continued.

LIABILITIES.


Total. Boston.

Capital paid in:Nov. 29Dee.6Dec. 13Dec, 20Dec. 27. . . .

Surplus:Nov. 29Dec. 6Dec. 13Dec. 20Dec. 27

Deposits:Government—


Member b a n k -reserve ac-count—

Nov. 29Dec. 6Dec. 13Dec. 20Dec. 27

Other deposits—Nov.29Dec.6Dec. 13Dec. 20Dec. 27

Total deposits:Nov.29Dec.6 :Dec. 13Dec. 20Bee. 27

F. E. notes in actualcirculation:


F. E. bank notes incirculation—net li-ability:

Nov.29:Dec.6Dec. 13Dec. 20Dec. 27

Deferred availabilityitems:


All other liabilities:Nov.29Dec.6Dec. 13Dec. 20Dec. 27

Total liabilities:Nov.29Dec.6Dec. 13Dec. 20Dec 27

107,207107,265107,244107,261107,256

215,398215,398215,398215,398215,398 |

33,449 !46,976 I23,136 I6,715 '7,809

8,1448.1448,1268,1268,126

NewYork.

28,67328,68128,68128,6812.X, 688

16,48316,48316,48316,48316,483

2,8175,0722,317

386119

60,19760,197CO, 19760,19760,197

7,27318,1452,476

766979

1,807,631 i1,843,(501 !1,817,744 i1,840,205 !1,861,281 !

19,143 i19,527 I20,230 I35,039 !31,165 i

1,860,223 I'1,910,104 I1,861,110 |1,881,959 '1,800.255 |

120,446 ,122,709122,106122,130124,810

308211222

.,982869

123,571127,992124,645124,498125,798

Phila-delphia.

9,3269,3269,3269,3279,327

17,94517,94517,94517,94517,945

2,2141,8101,544874761

679,289 I 107,994704,183 I 112,585680,828 107,877700,790 | 108,583707,106 ! 112,257

10,936 ! 1S610,725 I 24711,437 ! 48013,555 94212,251 766 '

697,498 110,394733,053 114,642694,741 109,901715,111 110,399720,336 113,78-1

Cleve-land.

11,70811,70S11,70811,70811,708

22,50922,50922,50922,50922,509

2,5341,1602,610

749123

149,579148,260145,161 j141,804151,807 I

836 '1,344 •1,021 i1,668 j1,543

152,949150,764148,792144,221153,473 I

i2,329,814 ;

•2,361,222 !•2,379,185[2,456,711 !B,464,121 |

193,717202,145201,671209,360211,213

594,003 208,762 i 234,214593,520 209,098 1 234,555591,809 216,166 241,974605,539 I 224,773 252,370

599,001 | 221,536 257,372

Rich-mond.

5,5945,598 •5,5995,600 ,5,595 j

11,030 '11,030 !11,030 j11,030 I11,030

3,8931,8182,182

089336

60,919 ,60,66157,89354,93859,123

94132107764752

64,90602,61160,18256,39160,211

96,95997,91899,045

103,844103,398

20,868 i19,259 !16,497 !12,499 j10,632 :

589 4,837646 3,818 •650 , 3,559 !150 3,048 j150 ' 2,450 I

1,083 ' 9441,008 l 031

508 921 j8 i 430

76 i 444

520,497540,233580,883576,997578,502

26,898 i27,772 '.28,326 [28,474 !29,247 |

5,080,9055,181,2535,188,6435,279,2995,305,411

45,69545,93155,05950,17755,609

1,9131,963 ;1,953 I2,011 :2,052

96,17394,703116,995115,707113,477

5,6705,8966,0606,0836,531

44.658 !44,50350,31751,12750.659 j

2,0452,1322,1442,2222,300

390,112 1,487,051 394,213403,304 il,519,868408,587 1,502,042410,805 '1,534,366419,431 1,530,680

398,654406,307415,801415,627

51,040 !521240 [53,789 I57,850 i60,901 I

2,6822,8032,8782,8712,946

476,046475,510482,571491,959509,353

Atlanta.

4,3094,3094,3094,3094.309

Chicago.

14,74314,74314,75314,77214,772

9.114 29,025 ,9,114 ! 29,025 !9,114 29,025 i9.114 29,025 I9; 114 ! 29,025

1,6933,1941,596

128•J5S

1,730 14,871 !1,001 :

532 !384

52,202 i 203,23852,519 j 261,04552,720 265,81053,632 270,36955,253 I 264,175

186172213782527

1,0811,1901,175 '•3,7593,252 i

54,081 I 266,04955,885 I 267,10054,529 i 267,99254,542 274.66056,238 267, SI1

123,170125,432124,479127,843129,493

1,406 j1,441 j867 I924 i914

1,1821,268777797349

400,932405,704407,848422,690428,298

1,8701,8821,8531,3941,269

48,89650,04252,33851,11744,959

1,264 j1,2901,2781,334 I1,348 |

230,055229,930230,339230,240227,455

19,370 i22,378 j22,984 j22,29419,702 |

1,355 !1,370 '1,379 :1,3811,391

212,593219,756217,571220,280220,596

63,06461,62765,33665,38367,447

3,4803,6223,6803,6463,668

779,172783,709790,484811,570812,290

St.Louis.

4,8124.812 :4,8134.813 ,4,813 I

9,3889,388 ,9,3889,3889,388

2,5253,1291.939

4631,283

03,58466,913 I68,211 j68,396 !71,362

561510575

2,173 i2,154 !

60,670 !70,552 !70,725 !71,03274,799 I

94,30294,45194,50196,83497,272 i

1,9421,4561,457 :

457457

36,86443,12240,92240,21940,694

1,0941,1201,1611,1861,232

215,072 .224,901222,967 '223,929228,655

Minne-apolis.

3,5323,5333,5333,5363,535

KansasCity.

4,5934,6314,6304,6234,623

Dallas.

4,444,4,

204204196105195

SanFran-cisco.

7,5697,5767,5707,5717,565

7,7,7,7,7,

468468468468468

9.9;9,99;

646640646646646

7,3947,3947,3947,3947,394

1,2411,851

421580893

45,53450,02445,55449,55547,914

374385325

1,602 I

47,14952,86046,30051, 73749,576

56,69158,00557,89459,18360,027

859963976485115

14,94416,675

2,6S42,1911,9381,027862

77,39279,53982,87580,77380,60S

968 .1,135 I2,638 !3,085

80,93782,69885,94884,43884,555

67,70569,50169,02271,55272,230

3,3283,4693,4673,0373,034

41,43543,198

15,408 i 41,74515,748 * 41,60716,106 ! 43,652

1,5221,5451,5691,5771,588

132,165141,049133,148139,734

1,4271,488

'• 1,536^ 1,5431 1,574

209,071! 214,6311 215,994! 216,446

138,415 '. 219,314

1,6171,422 i1,464 j135

1,076 I

15,19915,19915,19915,1'9915,199

3,2282,3133,648386735

53,931 133,52353,653 130,91053,854 134,84954,482 134,75352,499 134,367

270323285678583

55,81855,39855,60355,29554,158

39,89639,93838,93739,71939,685

2,2362,3021,3971,7091,274

24,88426,49126,90929,06927,532

1,7911,8401,8641,8001,807

136,223137,567136,300139,181136,045

3,4503,3203,2554,4964,414

140,201136,543141,752139,635139,516

219,457230,955235,842243,004244,596

583756500100

33,46839,32339,08136,69937,764

2,6552,7032,8242,8202,810

419,132432,374442,333444,988447,550



RESOURCES AND LIABILITIES OF EACH FEDESAL RESERVE BANK ON WEDNESDAYS, NOVEMBER 29 TO DECEMBER27, 1922—Continued.


MEMORANDA.

Ratio of total reservesto deposit and F.R.note liabilities com-bined—per cent:


Contingent liabilityon bills purchasedfor foreign corre-spondents:

Nov.29Dec.6Dee. 13Dec. 20Dec. 27

Total. Boston.

76.474.375.172.872.1

65.766.668.464.162.9

31,31,il,33,33,

5120073601529S1

2,3282,2852,3182,4302,509

New Phila-York, delphia.

Cleve-land.

85.0 I78.180.479.280.0 ;

11,733 j11,614 '11,67312,492 '12,639 :

74.374.074.871.7 I70.7 I

2,1432,0952,132 !2,2542,340

70.670.868.868.970.8

2,615 I2,556 |2,604 ;2,729 I2,818 [

Rich-mond. Atlanta.

73.174.071.667.160.2

1,5631,534 i1,556 I1,631 ;

1,683 I

75.377.978.276.176.1

1,1481,1271,1431,1981,237

Chicago. St.Louis.

81.479.9 i82.178.276.1

3,7953,7243,7793,9614,089

1,4991,4711,4931,5641,615

Minne-apolis.

KansasCity. Dallas.

69.070.470.263.359.8

76.177.274.774.373.8

62.860.960.953.957.3

60.257.954.157.056.7

SanFran-cisco.

861 :845S57899 '928 I

11111

,531,502,524,598,649

829814826865893

11111

,467,440,461,531,581

69.770.070.769.166.7

MATURITY DISTRIBUTION OF BILLS, CERTIFICATES OF INDEBTEDNESS, AND MUNICIPAL WARRANTS HELD BY THE12 FEDERAL RESERVE BANKS COMBINED.

[In thousands of dollars.|

Total.

Bills discounted:Nov. 29Dec. 6Dec.13Dec.20Dec. 27

Bills bought in open market:Nov. 29Dec. 6Dec. 13Dec. 20Dec. 27

United States certificates of indebtedness:Nov. 29Dec. 6Dec. 13Dec. 20Dec. 27

Municipal warrants:Nov. 29Dec. 6Dec. 18Dec. 20Dec. 27

650,704,659,615,629,

259,266,262,251246,

142,142,137,253,278,

Within 15days.

445,401 ;499,882 i462,861 j419,329 I436,465 j

60,451 I71,874 ;73,985 i72,811 '83,210 I

3,484 i2,258 I

225 i76,670 i

103,595 i.

16 to 30days.

56,41958,63154,34449,40548,609 ;

44,747 '53,195 |56,66365,693 |50,737 |

1,007 :720

1,720500

31 to 60days.

73,103 '69,02865,99266,51963,372

83,83078,02970,65469,056

1,720 j1,000 i

61 to 90days.

Over 90days.

76

45,218 I48,68945,94248,79450,059

47,12147,24745,64934,46138,083

7657676

62,38362,670

29,95528,71530,61931,51131,380

18,03810,6818,2468,1095,207

135,838137,835135,197113,729112,350



FEDERAL RESERVE NOTES.FEDERAL RESERVE AGENTS' ACCOUNTS ON WEDNESDAYS, NOVEMBER 29 TO DECEMBER 27, 1922.


Net amount of F. B.notes received fromComptroller of theCurrency:


F. R. notes on hand:Nov.29Dec.6Dec. 13Dec. 20Dec. 27

F. E.notes outstand-ing:


Collateral securityfor F.E. notes out-standing:

Gold and goldcertificates—


Gold redemp-tion fund—

Nov.29Dec. 6Dec. 13Dec. 20Dec. 27

Goldfund—F. R.Board—


Eligible paper...Amount re-

quired—Nov.29..Dec.6...Dec. 13..Dec. 20..Dec. 27..

E x c e s sa m o u n theld—

Nov.29..Dec.6...Dec. 13..Dec. 20..Dec. 27..

Total. Boston.; New Philadel- Cleve-phia. \ land.

Rich-mond. Atlanta.

3,609,1823,606,113 i3,640,5363,666,1133,679,260

890,711875,231865,216847,308844,168

2,718,4712,730,8822,775,3202,818,8052,835,092

346,317346,292346,292346,292353,657

131,560131,716131,365137,454133,090

1,370,2071,567,2021,625,4121,633,9421,712,0991,712,099

670,387685,672672,251701,117636,246

197,296239,116215,096131,013200,687

304,795 ; 1,190,850306,278 j 1,194,730302,805 ! 1,194,690308,208 i 1,188,744310,515 i 1,181,133

87,700 ;88,100 !80,900 j80,90083,100

217,095218,178221,905227,306227,415

15,300 j15,30015,30015,300 !15,300 !

19,40816,89113,41819,81916,928

93,00093,000 [113,000 i108,000118,000118,000

89,387 j92,987 i80,187 |84,187 I77,187 :

16,5653,97211,3193,44218,490

404,410 i399,610 !399,610 ]399,610399,610

792,440795,120 '•795,080 !789,134 :781,523 ,

268,654271,929 !271,466 :279,599282,837

39,760 I42,360 I34,64038,160 !37,360 '

281,054280,777291,423295,164306,624

31,14027,84027,94024,64029,940

134,158 '132,598 '137,698140,417139,302

29,02024,34028,12027,20026,400

228,894229,569236,826241,439245,477

283,1842S3,184283,184283,184283,184 :

35,66635,46935,22535,041 '34,875

341,000341,000341,000341,000391,000391,000

132,590135,467135,671 ,129,90972,464 '

7,000

11,598 ,13,87212,410 '13,98216,221

153,889155,889159,889166,389162,889162,889

249,914 i 105,138 i252,937 j 108,258283,483 ! 109,578 I270,524 j 113,217 ]276,684 I 112,902 !

13,275 j.13,275 |.13,275 I.13,275 .13,275 .

202,544202,3S0201,5642m, 551203,587

73,23971,99970,51969,6S067,189

129,305130,381131,045133,862130,398

2,4002,4002,4002,4002,400

Chicago.]

539,392530,730 S547,168 ,548,971 j551,631

101,040 !92,800 I102,36086,800 i78,920

St.

137,704 I138,148 \137,854 l136,848 ;137,732 I

25,720 I25,220 I24,22023,27022,470

12.S82 j13,204 !12,951 i13,191 j14,811 i

2,524 '3,9642,104 ;3,3232,208 •

155,000155,000155,000155,000155,000155,000

37,174108,82776,13531,23693,556

63,407 j59,808 j64,527 !61,068 j59,367

2,5153,6611,7595,6636,576

68,75771,45382,25789,05893,598

37,32229,17431,46220,3419,785

63,79560,79565,79562,79562,79562,795

38,81943,49941,67947,09947,899 i

7,8391,7397,7584,2218,336

5,2254,0613,2445,2314,268

89,00094,50095,00092,00097,00097,000

32,68029,42030.40134,23132,730

17,31414,09511,6749,4107,482

438,352 : 111,984437,930 i 112,928444,808 113,634462,171 113,578472,711 ! 115,262

11,61011,61011,61011,61011,975

14,85314,19116,66915,47215,571

354,645 ,346.644 !367.645 j374,645 I389,645 '

4,6193,9434,6094,6034,047

60,30058,30060,30058,30056,500

389,645 | 56,500

68,854 j77,095 !60.494 I72,054 j67.495 i

36,480 j36,86536,212 I21,880 !32,336

35,45539,07537,11539,06542,740

7,3913,1253,2352,407

20

Minne-apolis.

70,61272,44273,92873,01372,843

10,61311,75312,55810,9509,710

59,99960,68961,37062,06363,133

13,05213,05213,05213,05213,052

1,6492,9992,6841,7701,320

28,00028,00028,00030,00032,00032,000

17,29816,63817,63417,24116,761

3,3543,3852,4722,8973,321

KansasCity.

94,939 j94,34596,86599,37998,887

15,56015,56016,56017,06019,060

79,37978,78580,30581,71979,827 I

3,3424,5484,2683,383

50,36048,36048,36047,36049,36049,360

25,67725,87727,67730,97627,577

3,5836,239 !4,0653,6753,261 i

Dallas

62,61662,14761,55861,09860,740

18,29918,07918,01917,35916,939

44,31744,06843,53943,73943,801

7,496",471

SanFran-cisco.

315,864319,609323,517331,123333,429

54,21057,57049,77051,07053,470

261,654262,039273,747280,053279,959

7,4717,4717,471

2,9913,5232,9332,4732,616

15,00015,00015,00012,50012,50012,500

18,83018,074 118,13521,29? !21,214 !

17,11718,96020,85118,81816,220

16,S0315,05120,85019,16617,335

166,218170,714176,423185,953185,410185,410

78,63376,27476,47474,93477,214

10,6429,0748,1547,0231,304


JANUART, 1923. FEDERAL RESERVE BUTJLETIN. 117

CONDITION OF MEMBER BANKS IN LEADING CITIES.PRINCIPAL RESOURCES AND LIABILITIES OF MEMBER BANKS IN LEADING CITIES ON WEDNESDAYS, FROM

NOVEMBER 22 TO DECEMBER 20. 1922.

ALL REPORTING MEMBER BANKS IN EACH FEDERAL RESERVE DISTRICT.


Number of reporting banks:NOT. 22Nov.29Dec.6Deo. 13Deo. 20

Loans and discounts, in-cluding bills rediscountedwith F. R. banks:

Secured by U. S. Gov-ernment obligations—

Nov.22Nov.29Dec.6Dec. 13Dec. 20

Secured by stocks andbonds (other than U.S. Government obli-gations)—

Nov. 22.Nov. 29.

Total.

784784784784782

Boston.

4646464646

NewYork.

Phil-adel-phia.

Cleve-land.

Rich-mond.

Atlan-ta.

108105)105!105:104;

56*56'56!56|56!

7,279,570

302,349297,401309,271300,224287,157

3,658,4973,688,457

Dec.6 3,704,074Dec. 13 3)680)485Dec. 20 3.714,832

All other—Nov.22Nov.29Dec.6Dec. 13Dec. 20

Total loans and discounts,including bills redis-counted with F .E . banks:

Nov.22 11,189,994Nov.29 |ll,218,731Dec.6 11,246,796Dec. 13 11,258,09211Dec. 20 11,281,559!

U . S . bonds: I ' ' INov.22Nov.29Dec. 6Dec. 13Dec. 20

U. S. Victory notes:Nov.22 32,242NOV.29 34,165Dec.6 33,539Dec.13 ! 35,464Dec.20 24,536

U. S. Treasury notes:Nov.22 657,993Nov.29 653,766Dec.6 655,190Dec.13 657,064Dec.20 810,211

U. S. certificates of indebt-edness:

Nov.22 •. i 96,053Nov.29 ! 95,094Dec.6 | 95,132Dec.13 | 88,972Dec.20 i 241,863

Other bonds, stocks, andsecurities:

Nov.22 2,245,50*Nov.29 2,249,041Dec.6 2,251,450Dec.13 2,260,483|Dec.20 2,272,643!

Total loans and discountsand investments, includ-ing bills rediscountedwith F. R. banks:

Nov.22 115,718,685

16,954 114,84415,907 109,79417,186 117,99316,601j 107,11516,205| 94,338

237,29911,628,878238,48611,667,940241,229:1,653,267241,22711,630,285245,38911,671,481'

18,51118,83220,375'19,47521,075

249,160'247,134248,704!249,068247,992

8484 :

84184:84!

30,07331,115!30,623]31,19231,392 :

354,520;356,1231383,695'374,7431372,036|

78:78;78:78178

11,929.12,552;12,026i12,256|12,135!

41!4141

7,657!7,732;7,7327 64117,472!

Chica-go.

10910S10E10S10£

St.Louis.

3737373737

Min-neapo-

lis.

3131313130

Kan-sas

City.

7979797979

Dallas.

5252525252

SanFran-cisco.

686«66MU

44.572143,52145,12246,885!46,078'

18,21418,269'18,622:18,76018,680

119,835116,837120,663119632

56,93956,53156,70055780119,632! 55,780

123,055! 55,416

7,229,1481 584,005 2,216,209 334,284!"""""•"• 576,946 2,204,537 337,5981

570,702 2,211,876 338,672|7', 277; 383 I 567,881 2,247,948 335,271!, „,„ . ,„ 562,757^2,250,282! 330,256

649,314 311,252646,873! 315,793647,041 314,327651,223 319,507 337;805 '©98^676j 298)848654,790| 321,048| 335,0551,008,095! 297,049

551,507: 137,329543,436; 136,491538,592547,096

136,762138,931

541,101 135,387

332,730 1,003,673 289,375339,7641,012,043 289,115337,088 1,007,303! 289,463

«8,258 3,959,931831,339 3,982,271829,117 3,983,136825,709 3,985,3481824,351)4,016,101!

l,496,899il 102.274J 607,261!1,510,8401 102,0761 618,36911,503,677]! 103)8241,489,4-16!, 102,7481,485,6241 ' " ""

607,510597,730

101,158 590,089|

636 11,903651! 12,188

11,14010,3128,376

21,41021,88220,97420,74129,5991

12,112,75512,13612,465125,924

169,374171,071170,174170,306170,586!

601,9551603,5641607,7511603,8141599,3231:

62,70762,505163,83361,92062,750

1,072848748

1,015915

26,102 j25,86425,84925,47941,633

3,2603,2673,1852,7606,274

757,849753,214748,730757,197761,848

182,611183,495181,894181,637182,900

,033,907,034,111,061,359,057,158|,058,218'

178,522|178,280]177,9201177,218|176,444j

1,347;1,647:2,087!2,854:1,942;

31,953!33,916!33,500!33,796:48,293

3,8663,9464,0133,496

13,338

443,016 397,3261,599,7521 444,918445,182447,016451,395

404,0271,599,0001 443,875401,5201,591,017 444,847401,2261,592,557 453,539

456,2381397,9431,595,274 451,116

281,804282,410292,283292,288293,670

65,46265,63165,64365,33565,443j

475482491j557691

3,9053,8283,7443,8557,133

3,2873,2833,2023,1774,192

56,76256,74086,35288,09754,71"

27,88428,01128,19828,64529,963

1,4711,4091,5171,5031,210

4,5213,9503,6153,6258,853

8,2567,5197,4587,1039,920

35,12935,29836,89736,48935,769

138,535139,610139,812140,604143,457

4,2094,4584,7285,3313,288

85,63583,19382,96484,539118,476

28,68029,09229,17228,38233,076

52,71652,70752,66952,93750,975

2,7122,7552,8332,9171,472

12,28412,48712,63912,51418,92lj

3,4323,4723,5453,6355,935

412,305 87,916419,044 — --418,413420,801

87,41988,00887,922

427,794 88,668

Nov.29..Dec .6 . .Dec. 13.Dec.20.

•«, .«*„,« 1,136,499 5,763,053; 877,7071,831,39915,761,337 1,131,649 5,789,699 879,8431,834,310IS, 785,784 1,129,543 5,777,756 883,2601,571,16215,789,52l! 1,123,420 5,777,600 876,625 1,566,81016,116,436! 1,131,79115,957,9221 893,795 1,591,905

572,907575,146576,448579,416588,457

474,587 2,269,116! 603,978480,214 2,274,397 602,715479,205 2,266,106 604,541478,59lj2,272,214 613 464483,658 2,321,3651 617,087

8,2948,3188,2339,1088,193

44,71945,13945,04643,77745,463

193,847198,098196,374197,841192,588

246,860251,555249,653250,726246,244

25,81526,00727,29328,75629,273

237719219224181

10,009i10,02910,02910,03912,003

4,385!4,3874,4932,7745,937

27,86728,84527,10929,59528,167!

315,173321,542318,796322,114321,805

10,61210,63210,597i10,425|10,445:

4,982|4,9264,5274,5004 651!

75,295; 54,18075,828' 54,89774,321! 54,45873,797; 54.07573,304: 52,407

359,9941 215,827360,078| 213,149364,325! 212,293364,598: 212,515366,312! 211,974

445,9011 274,9446,538449,243448,820450,061

63,55864,32563,68862,66663,119

1,6301,719l,737j2,0101,479

15,33114,79114,54414,630!19,163

6,5486,8087,1057,1836,141

59,30259,21659,82060,66061,830!

18,70715,80316,23516,26616,493

148,836149,615150,637152.074151)801

738,638738,879743,987748,370749,364

272,972271,278271,090269,032

35,145J35,55735,39135,22435,721 i

756:657956956918

7,6107,9007,7058,160

15,055

4,7473,9024,7884,7138,520!

8,7938,6519,0539,2048,653

903,181904,297910,859916,710917,658

137,020137,462137,896135,663136,932

5,7746,6326,1857,0443,935

25,49025,02424,52325,13835,498

12,69912,03311,47810,10916,908

165,792163,638162,717159,287158,028

592,2701 332,593,397! 329,596,137 329,595,969 329,601,793! 337,

0401,6391,1711,3471,8991

1,249,9561,249,0881,253,6591,253,951.,268,959



PRINCIPAL RESOURCES AND LIABILITIES OP MEMBER BANKS IN LEADING CITIES ON WEDNESDAYS, FROM

NOVEMBER 22 TO DECEMBER 20, 1922—Continued.

ALL REPORTING MEMBER BANKS IN EACH FEDERAL RESERVE DISTRICT—Continued.


Total. Boston. NewYork.

Phil-adel-phia.

I

Reserve wi th F . R . banks :Nov.22 1,375,792 85,392 650,381Nov.29 1,356,129) 81,516 614,170Dec.6 1,392,010: 83,686 640,286Dec.13 1,360,204 84,363 616,3611Dec.20 1,384,597, 83,286) 635,125:

Cash in vault: j iNov.22 294,259! 18,797 88,629!Nov.29 286,463! 17,689 89,2191Dec.6 1 308,777, 20,120 92,543!Dec.13 ! 320,341! 21,471! 96,865,Dec.20 344,814; 22,677 107,656:

Net demand deposits:Nov.22 11,038,867' 809,742 4,775,836:Nov.29 11,094,036' 798,593 4,831,684!Dec.6 11,010,180' 802,0114,752,265!Dec.13 111,111,839)! 814,868 4,789,6581Dec.20 (11,186,196! 809,405 4,861,749

Time deposits: ! !Nov.22 ! 3,658,822' 238,637 789,401!NOV.29 ) 3,647,977;: 238,964 774,207Dee.6 ! 3,694,727': 239,230 779,825!

Dec.13 |3,691,373;! 237,431' 778.203Dec.20 3,687,168,1 235,895! 760,520

Government deposits: I !j ' INov.22 i 171,551;, 17,647 73,9111Nov.29 j 170,6371 17,648! 73,911Dec.6 ! 162,592!) 16,767! 70,215Dec.13 151,209:: 16,767) 70,215Dec.20 511,368), 26,204' 273,266

Bills payable with F . R.banks:


Nov.22 209,245!Nov.29 ! 204,014)!Dec.6 ! 270,877:Dec.13 233,128Dec.20 201,6911!

All others— ; |;Nov.22 ! 396).Nov.29 66l).Dec.6 ! 650!.Dec.13 | 835 !.Dec.20 : 647).

Bills rediscounted with F.R. banks:

Secured by U. S. Gov-ernment obligations—,

Nov.22 j 1,239 i 203!Nov.29 1,640; 203Dec.6 2,719! 203Dec.13 1,621 203Dec.20 1,554) 200

Allother— 1 iNov.22 1 149,464 34,186Nov.29 175,578 40,087Dec.6 ! 176,197 35,301Dec.13 1 161,298 34,545Dec.20 146,789! 29,282

9,11613,63911,8897,0009,485

117,30087,301

159,423138,447103,426

68,02668,69471,50967,42169,220

17,28917,46817,84318,8922.1,818

693,958692,61)1698,028693,307703,025

59,85358,11657,97158,30258,8-41

15,25815,28414,5182,88933,539

13,82616,36215,50213,21816,2221

Cleve-land.

21,34422,84726,06317,50310,565

123 125!408 125;

1,555500500

8,14914,45211 ; tO4i

14,41011,8488,911

Rich-mond.

Atlan-ta.

96,145104,444104,13793,987'97,944;

31,936!29,464!34,52Si36,21)7;40,3271

S57,527861,747868,276855,138|847,757

516,623519,322552,767555,823560,122

11,311;11,362!10,69310,693!25,830

10,760121,18611,85317,41413,996

2020120;

20!20!

188207253238175

13,31313,46715,40115,12215,499

36,11:35,732|35,24234,869i31,984!

14,701!13,540115,161114,90015,624'

Chica-go-

33,82132,41832,05232,53333,540!

I10,2569,979

11,00110,72011,587|

188,095198,363197,883201,146202,959

55,91854,07757.53959,32962,762

330,030 270,278;!, 422,158332,001336,539333,238

271,688:1,434,443273,8631,399,470279,56711,448,244

331,459 277,12011,464,504

148,263; 160,138147,065 159,189146,022 160,916144,4421 160,041145,494! 160,007

5.76115; 8365,5535,543'

10,860)

12,97612,55012,11614,169!13,026

275500500688;500!

5,475!5,472!5,16815,167!

13,2511

2,4501,6241,5001,3501,325

733,856732,092733,975734,628740,206

15,94415,39314,79615,00555,712

19,84419,53525,87017,02515,993

St.Louis.

Min- Kan-neapo- sas

lis.

37,95037,79340,10042,26741,736

7,777!8,064!8,325!9,008:

10,080!

City.

23,041 45,53020,554 45,10425,156) 48,01020,3641 50,723OO OCO! AT QAi*

Dallas.

27,04026,04325,93026,434

23,852! 47,8441 27,648

6,4325,7696,2746,7716,302

12,137!11,76212,57712,904] 1O;37O12,973! 10,268

9,9009,68710,311

342,273' 200,587 436,529 240,279337,315) 203,471) 437,060 240,187343,229. 205,437 440,131! 241,729356,617! 206,071 443,706 238,628356,509; 207,652 440,561 236,770

178,078 81,669! 122,353178,201! 82,988 122,384177,745! 83,601! 123,974176,4191 83,918! 123,592,-,-, ,„„! s 4 4 1 4 ; 126,043177,129!

12,15212,14511,54211,54114,848

6,402!

7',Sli\7,351!

3,22812,738!3,0243,0517,862

703703

1,0231,0231,013

3,3483,3483,1813,2019,095

4,9635,9318,0087,308

79147160116167

11,32912,54111,61113,86716,248

189203145191112

12,09915,30710,5089,19210,930

131162241193212

15,26820,66324,60118,39115,287

111929210447

8,5549,2789,8508,9409,985

11111

2,1712,8163,0212,5552,729

2627217108

9,6648,5489,6179,83610,313

Fran-cisco.

68,69769,46870,64670.2S570,597

2,0132,0101,9091,911

14,475|

300425160160475

3,4613,2323,2403,088l3,595

84,25391,29888,01989,73689,459

20,48719,74522,55522,90423,740

659,670653,246649,202652,797649,685

561,254565,981568,055568,289567,810

5,5035,4905,2265,226

26,426

10,60518,17515,5658,5009,520

101141130127127

9i 549! 569 588 503 29

9,92612,34012,57416,41113,445


JANUAET, 1923. FEDERAL RESERVE BULLETIN. 119

Total.

264264264264282

Boston.

2323232323

NewYork.

64646464«S

Phil-adel-phia.

4343434343

Cleve-land.

8S888

Rich-mond.

1010101(110

Atlan-

7t77/

Chica-go-

5050505050

St.Louis.

1313131313

Min-neapo-

lis.

7776

Kan-sas

City.

1616161616

Dallas.

88888

SanFran-cisco.

1515151515

209,717,|203,918'217,577;!207.234:195,709!

j

2,690,3112,717,4722,705,3152,688,928:2,730,332

:4,438,374;4,429,0794,425,3994,460,37114,452,748,j

|

I14,04212,98314,278113,731]13,300;

:

]185,5601186,739 1189,52411189,362[l192,95111

I440,823| 1434,616; 1428,6751426,7311423,6251

104,238: 16,613,99,7651 16,892,

108,030; 18,39297,238; 17,57585,090: 19,237

'

6,524.0,475!6,494i6,4156,630

1,58413,53411,595!1,57511,4241

34,25333,299:35,61l|36,66437,002'

14, 583114,723'15,046J14,918:14,651-

5,378;5,422i5,40416,259:5,347:

2,490;2,473|2,5012,4372,323!

2,241:2,20311,785!l,806!

1,965!

5,6515,8306,1046,2896,403

,457,915;,495,796!,475,390,454,264:,502,352!

;,932,171,920,100:,927,01.31,982,1231,961,9031

228,69S;

220,077-227,834228,480!227,133!

303,176!306,464J307,415j304,273:299,051!

I

139,465138,477147,634141,921140,984

296,171295,367294,108!295,698 !

295,6741

22,206'22,850:

20,95321,070

22,950l 20,07922,288; 20,259

PRINCIPAL RESOURCES AND LIABILITIES OF MEMBER BANKS IN LEADING CITIES ON WEDNESDAYS, FROM


MEMBER BANKS IN FEDERAL RESERVE BANK CITIES.


Number of reporting banks:Nov. 22 ,Nov.29Dee.6Dec. 13Dec. 20

Loans and discounts, in-eluding bills rediscountedwith F. R. banks:


Nov. 22Nov.29Dec.6Dec. 13Dec. 20

Secured by stocks andbonds (other than U. ;S. Government obli-gations—

Nov.22Nov.29Dec.6Dec. 13Dec.20

AUother—Nov.22Nov. 29Dec.6Dec. 13Dec.20

Total loans and sidcounts,including bills redis-counted with F.R. banks:


U. 8. bonds:Nov.22Nov. 20Dec. 6Dec. 13Dec.20

U.S. Victory notes:Nov.22Nov.29.. . .Dee.6Dec. 13Dec. 20

U. 8. Treasury notes:Nov.22..*.Nov.29Deo.6Dec. 13Dec.20

V. 8. certificates of indebt-cdness:

Nov.22Nov.29Dcc.6Dec. 13..Dec.20

Other bonds, stocks, andsecurities:


Total loans and discountsand investments, includ-i biH d i t d

I2,1202,3192,3372,3272,337

j20,41618,69019,89619,88220,199

62,715,65,025;64,16965,073|66,083

\

10,365; 422,236, 105,222:10,5?0| 414,96o| 103,94010,561 409,346: 103,93810,315 417,705; 105,826 —, — , _-,-.-.10,281! 411,929| 101,857| 23,527! 20,2771

163,1591 95,813! 117,583161,209' 98,670' 118,403

96,549, 119,65096,775: 119,57394,374! 120,612

52,687 616,70355,352 620,37753,1041 617,10853,6531 607,287

160,835166,587

52,993| 614,9641 166,257

;7,338,402:7 350,469;7,348,29117,356,53317,378,789!

!819,418"!S60,760i!852,059;j839,784'S2<i,2U6!J

:!lfl,13i:;20,62(119,493120,342114,5»7.:

!534,559''530,478-,532,126;;532,675:'637,903!]

52,122;'50,203:!49,833!'46,213i;

174,114!!

1,197,2041,197,0971,186,8201,194,3461,205,584 !

!

I640,425 3,494,324.1 548,487:634,338 3,515.6611 550,033632,477 3,510) 433! 553,641629,824 3,513,625 550,328!629,876J3,549,34a1 545,421

; • !

45,456 516,65S :

45,2511 527,264:47,240; 515,972!46,647j ."W5,2S7:

46,1201 491,5241

08J90

335114.il

1(1,692;1(1.974-9) 8699,01672:{S:

17,8141 395,74418,286: 392,90417,378; 397,105:17145 396,988

434016

;17,14522,216!

i3,995.3,98:14,007!2,626!4,349

78,53780,23179,7557 2

434,016

9,0089,3668,7389,067

120,258,;

47,727;47,622 ;

48,863 :

47,003i47,802i

1,025;79:>:091887S54

23,57523,53423,32023,29238,441

\2,86!-!2,8752,8702,3705,712

i442,160440,319448,236|444,034j443,2881

>30,663 !

30,726 :

30,557'31,120'3O,7SS:

85,25186,03486,40287,28288,619

5,448'5,4495,4595,4895,-170

64,67,65,65,5-64,"

636 1

2601i431

6981

207:

190' . .340i •579'S>0, '

0,228 413-6,228' 413'6,4I.V 4136,415! 413;8,499! 1,103'

561,487555,132548,690555282

79,755 548,69079,5251 555,28278,983 560,894

' I

ing biHs rediscountedwith F. R. banks:

Nov. 22 .Nov.29Dec.6Dec. 13Dec. 20

.1 9,990,836J10,009,627J 9,988,622J 9,989,893.: 10,237,276

786,32514,987,913782,179 5,011,301781,1924,990,807775,912 4,989,265781,6105,166,273

146,124146,031145,709145,309116,364

!

769,806770,893775,094769,189784,594

1,8691,844;1,8691,87712,3321

164,286]65,09764,55364,478!65,554:

1,315;1,315!1,31511,315;1,8251

:

7,0127,0257,1396,1850,165

5.1965, 1965, )965, 196.">, 196

729729729729729

1.0801)080

680680679

3,3602,5582,5582,1222,713

2,9812,9893,0072,9892,973

, 073,192,068,641,062,065,061,656,083,895

282,964279,872279,819287,331282,765

54,926; 33,34555,910l 33,228.56,099: 33,07156,380 32,61955, 392! 31,298

3,650i:',, 8881-4,113!4,361 !

2, 429!

61,545:59,279j59,13761,007S5,353

17,60017,74117,91717,08721,692

174,029180,520180,132182,077

211241351101369!

9,018!9,250!9,0898,964

14,279

2,67612,7072,7582,8243,352

55,79555,53756,001"" "

123,3971 141,026126,942! 141,946124,903! 142,230125,322' 142,269123,248| 143,212

6,699! 24,374.7,005' 24,4327,146! 23,767'8,645, 22,4338,964! 22,410,

6, 442:

6 533!6 572:6 702'

556

5,107i 4,709! 4,661!: 4,731!

250. 7,945!

11,135!10,808|10,940!11,061!11,114!

57,81957,336j57,42256,880

71,96370,83070,06170,28969,959

10,71110,71110,49710,415!10,3441

3018848714871464 j

3.6293', 8243,6293,5298,240

2,1282,130!2,179!l ,660 |4,389I

1,174-1,127!1,218!1,22011,591

66,14066,93067,22367,56567,728

298, 786295,677299,437305,176300,332

370,577368,437372,764379,030374,463

68,21567,96668,19268, 55067,991

2,0412,9832,0003,0291,852

10,40610,97110,2999,51116,885

11,718| 13,377|11,8161 13,45610,342

56,153 12,228!13,041!13,325!

1S9,OS5| 57,005! 10,436! 12,707

1,5641,1101,6051,5303,811

1,7671,8671,8602,0601,315

545,413! 99,439! 77,98211,384,942! 384,0091 143,948 185,500! 89,664100236! 799681385979 380835 147899 186203 88530544)404

551,970548,503550688!

, , , , , ,100,236! 79,9681,385,979 380,835 147,899100,728! 77,4301,379,463 381,089 144,576— „„.: 77 259!l3825681 388292 147861100) 684'103182

, ,186,203 88,530185,489: 88,1391846801 88310550,688! 103,182

, , , , , , ,77 259!l,382,5681 388,292 147,861 184,6801 88,31076,988ll,417,846! 388,868! 147,287! 188,4211 94,133

4,5653,4472,7992,5152,092

80,09177,39676,59174,73574,103

535,895531,200532,645537,370537,386


120 FEDERAL RESERVE BULLETIN. JANOABY, 1923.

PRINCIPAL RESOURCES AND LIABILITIES OF MEMBER BANKS IN LEADING CITIES ON WEDNESDAYS, FROM


MEMBER BANKS IN FEDERAL RESERVE BANK CITIES—Continued.


Reserve with F. R. banks:Nov.22Nov.29Dec.6Dec. 13Dee. 20

Cash in vault:Nov.22Nov.29Dec.6Dec. 13Dec. 20

Net demand deposits:Nov.22Nov.29Dec.6Dec. 13Dec. 20

Time deposits:Nov.22Nov.29Dec.6Dec. 13Dec. 20

Government deposits:Nov.22Nov.29Dec.6Dec. 13Dec. 20

Bills payable with F. R.

Total.

999,620970,050

1,007,807973,703

1,002,192

154,395153,612161,000169,786185,933

7,634,5997,680,0787,581,5997,642,3167,745,415! l

Boston.

68,48865,67466,33067,85367,828

Newv adel-

phia.

, |7,992]8,958]9,833

11,161!

605,177!569,973;594,145!563,936!588,054]

74,555j75.7621

77,373;81,728'90,351;

Cleve-land.

Rich-mond.

Atlan-ta.

Chica-go.

,289,380',346,583;,256,352;,279,097;

628;639|4,360,530:

629,288 4,2618,0414,3620,10214,2629,558i4,2

Secured b y U. S. Gov-ernment obligations—

PT V Nov.22 iNov.29 i

r"! Dec.6Dec. 13 iDec. 20 !

ill other—. £ Nov.22

Nov.29Dec.6 !Dec. 13 1Dee. 20 j

Bills rediscounted with F . 'R. banks:

Secured by U. S. Gov-ernment obligations—;

Nov.22 :Nov.29Dec.6Dec. 13Dec. 20

All other—Nov.22 iNov.29 iDec.6Dec. 13 :Dec. 20

1,800,1201,788,148],1,794,58711,791,824!1,775,8331'

126,767126,662i120,421 ]109,362:400,827; i

140,370120,950190,557152,344121,053

104,150104,288104,628;103,152!101,552j

14,089!14,070!13,366i13,366!19,141!

4,701,9,19918,924;5,575!6,3451

558,137542,7541549,306!547,055;527,5491

66,298l

66.298]62,98362,983

62,32662,67265,65262,046!63,785

13,932'14,655i14,40415,162]16, 441!

614,8971612,413616,305]612,090!619,616!

43,747142,037;41,78642,102!42,029,

14,377'14,403!13,682;2,724;

260,944 31,739]

101,855j69,330

141,195115,53082,060]

11,251,13,64212,752!

11,76814,422;

31,038!30,749!33,025]30,814'31,248'

7,717i7,635:

8.6571

9,954]10,428|

223,768!

225,9201233,237;232,457:224,897;

305,321'307,396!305,121!305,140309,070,

2,7022,702!

2,529:2,5295,582

725225;945930:

6,3865,7346,0825,7825,983!

1,004986993

1,0821,330

!54,75656,65358,18054,51857,045

24,43224,37324,25823,92724,129J

7401818;778;7781

3,067'

2,826!775'394

2,947!958.

5,918 131,0505,058| 141,7595,841 " " " "5,231;6,317'

I1,9921,9672,0572,017:2,300

St.Louis.

142,516143,658144,546

31,40429,83832,05533,011'35,596

25,62424,96126,43326,742

Min-neapo-

lis.

12,1319,530

13,7189,111

26,927 12,603

3,705]3 77ll3,709!4,155:5,147;

2,1761,8442,0702,0222,086

45,008 978,585 233,465 95,36745,523 990,967 226,500 96,73645,264 964,528 229,1961 96,93745,806 988,508 241,085! 95,30347,2811,011,973 235,972' 100,575

20,19520,32720,348:20,247;20,300

1,4801

1,479,1,400'1,400!1,792:

1,710'1,384|l,230i

730!

352,168] 104,377]350,499 104,226!351,427 103,849352,062 103,469357,860] 103,455

8, 733;8,532'8,2508,151!

9,887.9,8879,3919,390

33,626' 11,526

4,9093,645'5,550!

4,618il,960!

33,59934,67035,87835,14535,478

1,6551,6551,5561,5554,172

Kan-sas

City.

15,11014,04816,77418,10115,861

2,2522,2872,4792,5952,697

153,194153,556153,738157,207154,634

14,64014,56314,654114,686;14,807!

1,841:1,841:1,748s

1,748]5,743!

Dallas.

7,9337,0436,3687,2487,864

1,4441,1981,2561,3821,521

66,22565,79165,08365,71964,181

9,9139,95310,81610,75010,697

1,0641,0641,0131,0138,524

494768

1,866806816

77,35497,439104,51791,51474,407

1 203203203203200

33,56039,47534,62433,33528,862

123!408;

10,71111,49816,4209,6534,072

125].125.

1,555.500 .500!.

8,13914,45214,41011,848891l!

3,971!5,645'5,873!5,3385,165;

3,407!3,362]3,189!3,976!4,207j

518]1,079

690]708950

4,9537 408J

13,098]7 3505,180'

SanFran-cisco.

28,43932,84930,92333,18131,176

6,1045,6776,9896,8456,875

250,666241,395242,697240,962239,972

229,441233,062233,316234,089228,907

3,9213,9133,7253,72514,971

9,50016,65014,5508,4509,500


JANUARY, 1923. FEDERAL BESEEVE BULLETIN. 121

BANK DEBITS.

Bank debits are reported to the Federal Reserve Board for banks in about 250 centers.Figures for each center for the four weeks ending December 20, 1922, and for the correspond-ing four weeks in 1921 are presented below and summarized, by Federal reserve districts, inthe following table:

DEBITS TO INDIVIDUAL ACCOUNTS BY BANKS IN REPORTING CENTERS.

SUMMARY BY FEDERAL RESERVE DISTRICTS.


Federal reserve district.

No. 1—BostonNo. 2—New YorkNo. 3—Philadelphia...No. 4—ClevelandNo. 5—RichmondNo. 6—AtlantaNo. 7—ChicagoNo. 8—St. LouisNo. 9—Minneapolis...No. 10—Kansas City..No. 11—DallasNo. 12—San Francisco

Total

1922Week ending—

1921Week ending—

Nov. 29. Dec. f

463,2084,677,771

431,324488,028213,361191,155959,922249,337150,791247,015148,736533,408

8,754,056

485,413I,527,154408,400529.349218,021212,976935,274242,285150,081249.358153,883514,488

8,626,682

Dec. 13.

462,0254,323,341431,228577,745224,0082M, 394946,262253,783154,294250,186149,616539,251

8,515,133

Dec. 20. I Nov. 30.

547,7045,399,532472,099562,702247,636239.445

1,111,107296,204164,290275,173163,817596,994

10,076,703

420,9834,148,140352,833372,280207,325164,833811,604195,891

' 118,041204,381134,198468,664

7,599,171

Dec. 7.

485,4024,953,214, ,432,725427,815246,163180,432961,467234,163137,727228,640149,268536,443

Dec. 14.

454,0024,600,420376,294408,990226,928174,471908,272215,241131,413221,351141,010489,808

8,973,459 ! 8,348,200

Dec. 21.

522,9885,092,370448,208493,280239,263201,739

1,049,320236,926132,523236,540158,315562,491

9,373,963

District No. 1—Boston:Bangor, MeBoston, MassBrockton, MassFall River, MassHartford, ConnHolyoke, MassLowell, MassLynn, MassManchester, N. HNew Bedford, MassNew Haven, ConnPortland, MeProvidence, R. ISpringfield, MassWaterbury, ConnWorcester, Mass

District No. 2—New York:Albany, N. YBinghamton, N. YBuffalo, N. YElmira.N. YJamestown, N. YMontclair, N. JNewark, N. JNew York, N . YNo. New Jersey Clearing House Associa-

tionPassaic, N . JRochester, N. YStamford, ConnSyracuse, N. Y

District No. 3—Philadelphia:Allentown, PaAltoona, PaCamden,N. JChester, PaHarrisburg, PaHazleton, PaJohnstown, PaLancaster, PaLebanon, PaNorristown, PaPhiladelphia, Pa

DATA FOR EACH REPORTING CENTER.

[In thousands of dollars.)

1922Week ending—

Nov. 29.

2,835318,482

4,9048,760

20,3623,9364,8635,5764,0357,460

16,4147,793

32,52214,8826,532

14,332

19,0183,898

68,1273,1383,7442,839

59,3404,531,560

37,1716,329

33,2622,748

15,577

6,0462,9779,697«,9597,3872,7835,3725,2331,501

831343,098

Dec. 6.

3,184335,063

3,9457,046

21,6773,7154,4106,2796,4986,435

17,4478,143

34,83215,3537,918

13,692

23,5544,661

61,4703,1263,8413,056

53,7394,379,083

42,1436,950

36,0422,598

15,394

5,9333,268

12,3044,202

Dec. 13.

2,1845,2104,8711,313

752326,013

3,211304,807

5,3878,390

21,3643,7315,5686,1816,9647,092

17,83310,59332,91214,9206,776

17,864

23,9S54,251

63,2973,2253,9163,166

59,3894,180,662

46,0147,236

30,2362,646

13,674

6,0053,654

12,5194,2507,0982,3456,1745,1731,482

996340,309

3,225369,965

6,4109,308

26,9694,3365,6816,4136,4378,822

20,2977,547

39,50217,8498,802

18,964

30,7604,884

72,1433,7894,4144,147

73,4595,229,239

50,9998,040

36,0283,231

18,438

7,3123,457

13,8736,2778,8282,7865,7066,1921,595

926369,974

1921Week ending-

Nov. 30.

3,335 I299,565

Dec. 7.

3,693342,536

6,34120,7652,5753,917

3,9755,732

13,1237,02327,70410,6435,104

11,181

18,5403,197

47,941

5,86322,6082,8064,424

4,038,837

4,75023,109

6,1975,966

10,8258,51030,43914,0156,66914,851

SO, 9734,32656,709

4,819,118

5,58331,793

11,766

2,737

14,712

2,901

4,054 !5,768 '

5,0954,348

4,1766,923

4,6124,980

279,275 352,474

Dec. 14.

3,578318,886

4,60021,2092,8285,051

6,7286,785

16,5136,807

29,69911,7245,042

14,552

22,5723,914

57,271

4,470,028

5,35029,435

11,850

3,108

3,6866,978

4,4524,728

295,669

Dec. 21.

4,483364,359

7,96421,9663,3115,183

4,9658,152

17,6587,815

37,68414,9927,034

17,422

22,9393,87363,268

4,949,793

7,36130,814

14,322

3,068

5,1585,319

356,605


122 FEDERAL RESERVE BULLETIN. JANUARY, 102!?.

DEBITS TO INDIVIDUAL ACCOUNTS BY BANKS IN REPORTING CENTERS—Continued.

DATA FOB EACH REPORTING CENTER—Continued.


District No. 3—Philadelphia—Continued.Reading, PaScranton, PaTrenton, N. JWilkes-Barre, PaWilliamsport, PaWilmington, DelYork, Pa

District No. 4—Cleveland:Akron, OhioButler, PaCanton, OhioCincinnati, OhioCleveland, OhioColumbus, Ohio.'.Connellsville, PaDayton, OhioErie, PaGreensburg, PaHomestead, PaLexington, Kylima, OhioLorain, OhioNew Brighton, PaOil City, Pa •Pittsburgh, PaSpringfield, OhioToledo, OhioWarren, OhioWheeling, W. VaYoungstown, OhioZanesville, Ohio

District No. 5—Richmond:Asheville, N. CBaltimore, MdCharleston, S. CCharleston, W. VaCharlotte, N. CColumbia, S.CCumberland, MdDanville, VaDurham, N. CGreensboro, N. CGreenville, S.CHagerstown, MdHuntington, W. VaLynchburg, VaNewport News, VaNorfolk, Va.Raleigh, N. CRichmond, VaRoanoke, VaSpartanburg, S. C ;Washington, D. CWilmington, N. CWinston-Salem, N. C

Dittrict No. 6—Atlanta:Albany, GaAtlanta, GaAugusta, GaBirmingham, AlaBrunswick, GaChattanooga, TennColumbus, GaCordele, GaDothan, AlaElberton, GaJackson, MissJacksonville, FlaKnoxville, TennMacon, GaMeridian, MissMobile, AlaMontgomery, AlaNashville, TennNewnan, GaNew Orleans, LaPensacola, FlaSavannah, GaTampa, HaValdosta, GaVicksburg, Miss

1922Week ending-

1921Week ending—

9,79916,88611,6639,6613,S366,9633,490

12,4992,1648,95168,276132,69029,0591,50812,0516,4155,338718

4,8143,3331,0862,3533,112

190,4354,524

27,1662,7528,26410,5512,364

4,54282,386 I5,000 I9,5578,0634,1381,9713,0434,9836,1695,0001,9115,7164,4142,283

17,0945,800

31,2505,3622,63442,2206,6946,848

1,01427,0646,60124,834

584 .7,2263 177 !450

1,088207 t

2,410 !10,5545,8314,2271,7025,4044 550 !14,762 i

250 I61,3071,0259,2426,5281,1292,000

8,39813,43311,9357, 7534,0606,8S94,700

13,3492,1028,95471,654128,84531,442 !

1,259 j15,270 !6,231 |4,195 !

730 I5,165 !3,217 |1,261 j2,1662,637

220,3125,489

33,738 j2,370 !

11,195 j13,565 I2,378 !

3,857 i79,944 j5,986 !9,839 j9,656 |5.189 !1,563 !3,533 |5,000 '5,0735,0001,9525,7194,8162,03620,8077,40031,5836,4752,22541,3885,3495,960

1,30026,1827,34020,823

6628,3073,019444610237

3,16512,3306,2244,4872,2207,6335,27816, 111

34278,4321,8148,8796,766969

2,370

9,31616,35213,6929,4234,1817,1974,409

14,3012,41711,76269,084131,45831,6641,54014,2256,3884,439752

5,9513,5371,4152,3433,019

269,0684,93835,2343,1079,99313,2172,704

4,21780,5006,6079,0288,8435,0722,2673,3895,2885,8754,2002,0365,6774,5621,827

23,1478,700

33,2857,6752,567

42,7525,2257,254

1,12828,521'6,648

23,309663

8,6263,027 I

452644 !244 ;

2,95912,104 !6,6325,2272,1656,6214,796

16,027383

66,5761,5557,876'6,9601,1231,916

Dec. 20.

10,36516,99814,81410,0184,2379,6185,615

15,2,11,82,

148,34,1,15,7,4,

6,4,1,2,3,

216,4,452,10,122,

4,22897,5005,784

10,5519,6145,3952,2403,8625,0814,8594,7002,4647,1665,5171,986

17,4499,30035,3888,8212,38549,4595,88111,995

1,30032,6067,276

25, 799734

9,0643,701379705302

3,17213,0239,2795,4071,9227,1395,28117,414

52786,3101,7818,9967,2671,1912,803

Nov. 30.

7,22313,5439,2628,8343,3445,9743,376

8,916

49,423107,03822,775

12,9485,3643,133

3,364

2,290137,511

2,747

8,0348,731

101,3945,875

6,7173,950

3,274

3,900

13,9133,050

28,269

32,8384,145

21,9575,621

12,031

5,963

i6,0724,7703,505

6,2793,230

12,060

62,2451,3449,1984,797

1,761

Dec. 7.

8,51314,32011,2907,5974,0867,1083,745

11,257

61,155124,47126,821

13,7145,7173,705

4,205

2,854151,063

3,509

8,72110,623

112,7465,455

6,3655,526

4,181

5,103

i8,9783,400

37,319

42,1514,939

Dec. 14.

7,14215,41411,6019,0484,6335,9933,842

10,198

60,607115,50226,417

12,8527,0624,347

3,856

2,456144,867

3,297

7,35810,171

100,0005,109

6,6i34,690

3,912

4,435

17,2653,900

32,387

44,5544,663

25,4896,337

13,920

8,491

10,2796,0324,027

6,1803,780

14,123

60,5961,570

11,3706,482

1,756

24,6295,379

15,331

8,112

9,7676,1633,923

6,1793,883

14,823

57,4721,6269,5995,902

1,683

Dec. 21.

7,98616,75813,5939,9984,5417,3004,290

13,758

75,441144,37130,648

12,7286,3576,270

4,208

2,994173,251

3,630

9,30910,315

109,9156,960

7,7045,029

3,744

5,791

i5,9043,100

31,115

44,5335,468

30,9938,115

16,453

9,114

11,9766,6574,980

6,6764,414

15,765

66,5141,452

12,1094,910

1,611




DATA FOR EACH REPORTING CENTER—Continued.


1922Week ending—

District No. 7—-Chicago:Adrian, MichAurora, 111Bay City, MichBloomington, 111Cedar Rapids, IowaChicago, 111Danville, 111Davenport, IowaDecatur, 111

' Des Moines, Iowa •.Detroit, MichDubuque, IowaFlint, MichFort Wayne, IndGary, IndGrand Rapids, MichGreen Bay, WisHammond, IndIndianapolis, IndJackson, MichKalamazoo, MichLansing, MichMason City, IowaMilwaukee, WisMoline, 111Muscatine, IowaOshkosh, WisPeoria, 111Rockford, IIISaginaw, MichSioux City, IowaSouth Bend, IndSpringfield, 111Waterloo, Iowa

District No. 8—St. Louis:East St. Louis and National Stock Yards,

111Evansville, Ind ,Fort Smith, ArkGreenville, MissHelena, ArkLittle Rock, ArkLouisville, KyMemphis, TennOwensboro, KyQuincy, 111St. Louis, MoSpringfield, Mo

District No. 9—Minneapolis:Aberdeen, S. DakBillings, MontDickinson, N. DakDuluth, MinnFargo, N. DakGrand Forks, N. DakHelena, MontJamestown, N. DakLewistown, MontMinneapolis, MinnMinot, N. DakRed Wing, MinnSt. Paul, Minn

DoSioux Falls, S. DakSuperior, WisWinona, Minn

District No. 10—Kansas City:Atchison, KansBartlesville, OklaCasper, WyoCheyenne, WyoColorado Springs, ColoDenver, ColoEnid, OklaFremont, NebrGrand Island, NebrGrand Junction, ColoGuthrie, OklaHutchinson, Kans

Nov. 29.

6502,1022,3331,8534,575

637,0122,600 j6,652 j2,960 I16,203121,0982,6446,6347,2713,22114,398

3,67027,9784,4724,4165,1001,913

52,8161,5841,1152,3006,7573,9785,08714,1697,0655,0932,861

10,1486,9403,296878

1,44614,34932,58139,2201,5792,313

141,2172,569

9412,350460

25,3172,7211,7232,753451

1,41976,2561,120621

133,07537,8772,9651,6451,045

1,3242 5232,8464,1772,50937,7991,899802

1,071627605

2; 811

Dec. 6.

3,5192,0222,9115,288

587,6412,1008,9793,27815,439

124,0123,0986,0326,8712,57312,140

3,00038,5833,3404,7337,4002,417

54,5001,9781,3222,70010,5165,6193,66415,2846,6415,130 j3,839

9,0907,4402,9571,3731,45514,55531,51339,5811,5302,357

134,4883,261

1,4902,642483

21,4652,4892,1782,743561

2,31976,5471,174673

133,79638,9253,6401,8911,200

1,3612,8613,6352,8962,39434,4393,103944

1,298772886

3,326

Dec. 13.

8152,9732,7412,2655,443

586,0732,8007,3463,36517,119129,6923,0116,1847,4883,21614,4192,3762,89037,9453,7604,3255,7002,65959,7521,6421,3862,50010,8374,7845,15915,6008,2015,0213,549

11,3107,9393,0321,2961,38015,16535,397

1,9113,016

140,6703,406

1,3052,242326

22,3592,5821,8612,658615

2,91279,3791,159569

i 35,13042,2643,5931,8041,381

1,5512,2443,6302,1463,00736,5992,754762

1,300679793

3,776

Dec. 20.

7893,3452,7012,6925,133

686,2202,9007,9403,55117,024170,8543,6486,9047,4673,24015,9802,5443,82043,7384,5065,0677,4002,469

66,3771,0861,4192,600

10,1185,0865,483

16,23010,9246,5443,917

10,416•7,1402,9511,1071,611

14,36643,11241,2562,3512,688

173,7093,517

1921Week ending—

i:20,

2,

k

•40,

3,6311,8511,289

1,4842,3823,7142,2532,948

35,2623.189

9181,294

8341,3123,941

Nov. 30.

2,6671,8987,798

548,462

5,7852,200

12,90091,3242,5974,3386,002

17,719

25,0702,5143,4063,863

43,3771,197

Dec. 7.

6,027 I3,959 !

6,2255,2825,0751,919

6,497 i4,520 i

9,34933,629 !23,434

1,805114,3592,298

1,4181,831

16,4112,6631,4822,401

60,821

'24," 812'

3,4221,929851

1,1792,068

2,0022,09630,774

2,7872,1179,608

648,920

6,9473 16215,729103,5182,7634,7167,742

21,071

30,8443,1244 2434,596

53,3501,947

8,1905,137

7,4565,4645,1032,933

8,8245,060

Dec. 14.

2,5312,2309,623

596,510

Dec. 21.

6,0763,24216,175103,2042,4014,1837,044

21,828

34,1303,2174,2074,188

53,2911,578

7,8244,108

6,8566,0895,3762,361

9,5144,660

10,54430,10728,937

2,722145,004

2,965

1,5362,338

14,7612,7952,0103,558

72,262

"3i,"086'

4,0602,1191,202

1,1631,623

2,1352,468

34,153

10,04432,43226,293

2,245127,1622,891

1,2211,827

19,6822,4641,6783,647

65,886

'28,'257

4,0001,7241,027

1,2892,416

1,9433,04531,678

2,9872,4548,898

675,522

7,0453,29016,057144,5032,8585,4258,468

25,526

36,0584,3325,5465,019

58,6592,052

8,7094,522

6,0275,8882,669

8,0555,281

11,21130,42027,453

2,242148,986

3,278

1,7061,684

15,9952,4611,5313,435

69,482

29,565

3,8581 7741,032

1,2951,972

2,2762,53536,200

i Debits of banks which submitted reports in 1921.




DATA FOR EACH REPORTING CENTER—Continued.


District No. 10—Kansas City—Continued.Independence, Kans IJoplin, MoKansas City, K a n s . . .Kansas City, MoLawrence, KansMcAlester, OklaMuskogee, OklaOklahoma City, Okla.Okmulgee, OklaOmaha, NebrParsons, KansPittsburg, KansPueblo, Colo...St. JosephJ MoTopeka. KansTulsa, OklaWichita, Kans.. .

District No. 11—Dallas:Albuquerque, N. MexAustin, TexBeaumont, Tex jCorsicana, Tex iDallas, TexEl Paso, TexFort Worth, TexGalveston.TexHouston, Tex IRoswell, N. Mex •San Antonio, Tex ]Shreveport, La •Texarkana, Tex iTucson, Ariz ;Waco, Tex i

District No. 12—San Francisco: ;Bakersfleld, Calif iBellingham, Wash !Berkeley, Calif !Boise, Idaho

Fresno, CalifLong Beach, CalifLos Angeles, CalifOakland, Calif.Ogden, UtahPasadena, CalifPhoenix, ArizPortland, OregReno,NevRitzville, WashSacramento, CalifSalt Lake City, Utah . .San Bernardino, Calif.San Diego, Calif.San Francisco, Calif...San Jose, Calif.Seattle, WashSpokane, WashStockton, CalifTacoma, WashYaldma,Wash

NOT. 29.

1,9142,5934,190

72,848963

1,3636,119

17,7612,281

43,450853

1,3315,631

14,8992,841

19,6518,700

2,2862,9662,8061,249

39,4016,772

24,77219,09526,349

5396,249

10,1551,8201,7034,362

2,7321,4873,2942,9511,809

16,8328,632

129,69222,4217,4666,2234,932

30,7482,517

15010,87715,7081,4879,212

190,9525,863

43,03110,8265,4608,3192,384

1922Week ending-

Dec. 6.

2,1R42,8693,952

69,2131,1481,1937,585

17,8871,911

47,1591,0911,3003,657

16,9133,644

21,13811,390

2,3124,2473,7921,190

41,2588,144

25,18619,49628,119

6326,3577,5381,5651,7524,117

2,5151,7514,3122,9231,400

18,18811,484

126,36831,2498,2467,0184,833

29,4912,599

22017,27319,5451,6369,694

156,7325,605

35,24711,7885,7948,3062,626

Dec. 13.

1,7483,2073,817

70,750994896

6,84816,4322,142

48,126785

1,5013,151

15,4133,465

22,04011,390

2,2644,4863,7521,314

38,9516,871

26,42017,07626,594

6307,3557,3252,4441,9154,163

2,7871,6884,2554,0112,740

17,79111,605

139,48126,2197,7557,5144,893

34,2412,360

17821,43216,2611,780

11,250162,995

5,08237,51710,8716,3179,7632,531

Dec. 20.

2,1153,1524,320

87,1521,0851,2497,028

21,2182,222

48,3871,1791,5104,079

16,0203,353

24,70211,433

2,5203,3704,3211,240

47,4887,588

27,11617,82229,102

7557,4678,2492,5432,0054,226

2,5621,0214,0693,2862,400

14,44412,799

158,22328,6768,8957,4004,501

34,6692,754

15122,84719,4351,768

11,504193,489

5,70239,07111,8405,588

10,0942,209

Nov. 30.

1,9002,980

57,280

3,83719,122

32,300

5,15714,0163,141

17,2949,235

1,9542,4362,477

34,3346,997

29,44014,11525,090

5,4825,6251,0881,5043,654

2,3992,519

11,4386,007

108,78917,8514,6264,809

29,3252,255

13,33815,454

7,i44178,454

4,79735,9988,1295,0857,7012,546

1921Week end ing-

Dec. 7.

2,2433,491

67,995

3, Hi21,897

40,818

3,79416,2113,112

14,6159,811

2,1413,6553,005

36,7527,913

30,42018,59826,583

7,2055,8151,1791,8994,103

4,2802,900

i6,0437,373

113,38023,1224,8716,086

30,2692,699

19,S8i19,683

9,876211,581

6,12928,45511,8546,0138,5043,444

Dec. 14.

2,3223,250

64,355

3,04517,470

36,270

2,97916,3615,051

21,2008,677

1,5802,9833,209

33,5497,297

31,31216,16923,626

6,8776,9462,2621,6223,578

3,9042,851

ii,6Ii6,915

116,72620,1363,4263,939

32,6322,366

19,28518,055

9,398169,374

6,89831,61510,3695,9479,0182,939

Dec. 21.

2,4443,946

68,889

3,70318,851

37,521

4,96916,3683,997

22,1999,375

1,9372,1963,673

40,3127,678

31,24616,01233,257

6,7837,7272,0031,6593,832

3,6732,901

12,9296,164

140,44223,7913,3604,724

32,5002,632

17,61727,520

9,081204,795

4 11737,15010,8875,4629,6173,129


FEDERAL RESERVE CLEARING SYSTEM.OPERATIONS DURING NOVEMBER, 1922.

[Numbers in thousands. Amounts in thousands of dollars.]

Federal reserve bankor branch.

Items drawn on banks locatedin own district.

In Federal lOutsidc Federalreserve bank or reserve bank or

branch city- branch city.

; Num-!I her. Amount, j

on Treasure? Total items han-)f United d l e d ' exclusive ofState duplications.

Items for-warded to

other Federalreserve banks j

and theirbranches.

Items for-warded to

parent bankor to branch

in samedistrict.

Total items handled, includingduplications.

Number.

BostonNew York

BuffaloPhiladelphiaCleveland

CincinnatiPittsburgh

RichmondBaltimore

AtlantaBirminghamJacksonvilleNashvilleNew Orleans

ChicagoDetroit I

St. LouisLittle Rock !Louisville ]Memphis :

MinneapolisHelena :

Kansas CityDenver" :Oklahoma City iOmaha '

Dallas |El Paso :Houston

San FranciscoLos Angeles ]PortlandSalt Lake CitySeattleSpokane

Total: November.October...

015:l,990j

217!1,850

750200538119279638224

616474

1,060295311

7210780

26029

34514070

104209

4380

327394

6658

132

11,840

604,9464,547,347

100,573825,852258,251129,241258,469149,026157,263189,76048,59721,67831,94950,869

609,859170,186257,211

31,95363,41154,353

128,39711,060

216,41153,13258,66155,00995,42011,11645,586

127,056146,714

35,31634,83340,61320,964

3,850!5,311

4812,2851,403

829928

2,179773390205

233119]

4,036611

1,515388!4471249!

1,865!238

1,31236S1

1,018!592;

l,442j132|352;709:

1,449'2321418244209]

Amount. \

447,042j676,156!58,061

288,102163,95483,050

102,050320,12177,36350,59218,54115,58220,89015,561

337,94253,86493,44526,96424,90520,81094,41517,42993,11424 89673,85834,589

220,83410,19532,89449,325

109,34113,58730,44816,82111,275

i Num-! ber.

Num-ber.

9,641,082;36,67li12; 492 10,701,685138,392,

3,728,6163,942,331

17211,117]

18172928053535943141216404244114294112471295291139341738735724183213

3,1493,629

14,88295,4892,396

24,5285,851

5,1165,"""7,4944,2561,4751,1491,2795,380

48,2234 , r -

12,831898

3,4271,5517,7641,1469,6815,3161,1852,638

1,7501,582

37,69310,0993,7882,8347,4211,513

352,937447,233

4,6378,418

7164,3072,245

'1,1201,5192,3511,1111,071

443232313|233!

5,520!947

1,968!469!595341!

3 1,877|279|

1,752:537,

l,099!

3 736!1,685!

192,4701

1,109|1,900

322!494'40S|

261

1,087,470!5,318,992

161,030i1,138,482

428,056« 222,438

365,635475,095|242,120!244,608

"8,613!

Num-j•; ber. i Amount. 1922 19212: 1922

54,118!71,810!

996,0241228,139|363,487159,815191,74376,714:

'236,068!29,635

319,20683,344

133,704. a 92,614!

320,13723,06180,062

214,074266,15452,69168,11564, 85533,752

2211,235144449581384163139242032541

3332138!39,2;S47

2417152417813153610861522

53,128:.146,277,25,685!93,987!.5,346!5,775,

42,181169,35538,520!

9,09l!14,815;4,951i1,633:

12,831i34,145i6,423|3,564j

!394i

17,155|4,3831

32,40918,0668,9475,816

26;33

:>, 34518,4751

2,1603,830

18,066l,32i;3,760!5,0952,934

29;1432;36]83!25!28;

713

1110I;2;

10!2

64,48:

17118.41i

6!5i

32;

59:38!10!44'

5,837!4,115!9,505!9,562!9,053!4,094'

35,182:1,226

601!809!

2,620!865.!

1,051,1,264|

182!275648

1,77411,28014,5516,6524,9624,542

6131,0773,7538,5034,5432,3824,5382,936

!51,677U3,730,270(54,531| 15,098,723!

3,836!3,900]

705,189!766,012!

774844;

182,815 56,205,464 59,275

4, 8589,679,

893:4,756)2,332!1,147;1,635:2,550!1,333!1,120!

491;271321280

5,863973

2,017482605345

1,971288

2,057656

1,168795

V211490

1,1772,067

366519474293

4, 593!8,238,

84914,4281)7611,11*11,378]2,32ll1,128]

565!451!237!2901260!

5,3511766:

1,871411550j299]

1,826252

2,147!590J

• N o v .1921 2 ! 30,

! 1922.

Number ofmemberbanks.

1,573201476868

1,5563534981414273

1,120,5985,470,614205,190

1,232,469439,239232,328417,321554,012289,693257,793118,61044,58656,352!85,4501

1,032,789235,427368,10261,93492,702|77,383253,87135,792362,895115,961149,303103,392334,36825,49983,299221,657292,72358,55574,25774,48839,622

1,047,8271

,085,112357,388206,228352,392516, 813264,409135,50778,50040,16355,156!75,488981,044207,361311,67652,76780,21855,644234,34330,662400,063107,880154,77291,762305,71424,38879,091221,972224,80660,81370,94265,81144,883

287 49,660 14,618,274110,— 49,086 16,070,19911,

880,891253,327

4287228471431322434447216122793788956

1,3181253847095598231913301614142496606513819416113616366109

9,9169,918

Nov.15,1921.

4367128570131722234246416022476708655

1,3191243676994558192013311613372566577113321117413318061102

Number of nonmemberbanks.

On parlist.

Not on parlist.'

Nov. Nov.30, 15,

1922. 1921.

259]26478

484515314252699263

9135|61

14551

3,986259

1,701233344188

2,411193

1,42126342291373659

25527418713610392149

9,805 17,836 18,3199,80317,85118,388

25625277471521321242732269104336314650

3,979256

1,741228340186

2,474;218

1,452|278549922842(73i

26827716016611099!.

164!

N o v . N o v .30, I 15,

1922.! 1921.

l:

568] 573

458143i1471159

514119146157

223] 229

1

1

16018C7

17

15452

25

1671301

'"i82

l!

2,286! 2,2182,281 22,00

1 Incorporated banks other than mutual savings banks.

«Includes items drawn on banks in other Federal reserve districts forwarded direct to drawee banks as follows: Cincinnati, 11,000 items, $1,765,000; Minneapolis, 5,000 items, $5,492,000; Omaha,1,000 items, $378,000. Total, 17,000 items, $7,635,000.

NOTE.—Number of business days in period for Boston, Cleveland, Cincinnati, Little Rock, and Salt Lake City was 25, for New York, Buffalo, Atlanta, Birmingham, Detroit, Louisville, andOmaha 24, for New Orleans 22, and for other Federal reserve bank and branch cities 23 days.

fedaoa

m

B

3

to



GOLD AND SILVER IMPORTS AND EXPORTS.IMPORTS INTO AND EXPORTS PROM THE UNITED STATES, DISTRD3UTED BY COUNTRIES.

Countries.

DenmarkFranceGermanyNetherlandsNorwaySpainSwedenUnited Kingdom:

EnglandScotland

CanadaCentral AmericaMexicoWest IndiesArgentina ,ChileColombiaPeruUruguayVenezuelaChinaBritish IndiaDutch East Indies..HongkongPhilippine Islands..British Oceania

Total.

EXPORTS.SpainSweden ,United Kingdom—England.CanadaCentral AmericaMexicoWest IndiesColombiaChinaBritish IndiaDutch East IndiesFrench East IndiesHongkongJapanAllother

Total.

Gold.

November.

1921

$15,2,051,331494,144470,682

26,8285,916,524

18,407,191

"i"!, 375,255498,694584,349298,238

96,719708,748266,182319,01361,778201,634, 027,921

1922

$1,910,84421,47692,842

64S20,72068,055

11,762,865

836,322276,724568,45643,461

675356,05560,732

67,3341,367,664

98,434563,402,568,718262,841

51,298,626

256,732

54,935

245,770

"50," 666'

607,437

1,261164,180637,15550,618

11 months endingNovember.

1921

$3,410,344186,958,08219,456,75219,219,7391,534,9853,319,28164,993,365

188,361,912

34,541,6595,845,0865,259,1356,892,6851,059,237386,119

10,921,0771,447,5196,446,7571,197,758

17,813,10131,814,386

1,025,7985,660,8251,181,030

14,815,7345,972,392

20,047,712

18,308,087

1,000

2,2542,192,534

175,135

*5o6,"666'

"35,'666'

512,600

""3," 542'

3,431,065

659,582,470

2002,643,013

2,707,574

5,405,039250,844

1,179,00060,000

9,409,525

""74," 600

21,729,795

1922

$17,769,57621,516,936

35,1189,929,5058,423,894

55,66332,865,047

106,131,504151,320

9,876,3754,178,0335,418,9701,764,688

20,983355,328

6,592 6711,337,086

273,689848,172

7,760,702

1,301,99914,730

714,3354,135,016

981,7636,277,005

248,730,108

717,00078,0005,518

20,504,82212,127

3,848,6595,749

500,000100,000

4,445,339435,010

3,270,625

242,454

34,165,303

Silver.

November.

1921

$6,14356,702

3,656143

1,036

273,318131,566

4,668,6367,308

143,74115,460

551,68912

583102440

1,286113169

49,976

5,912,079

1,260,7061,017,995

195,6

1,029,993

673,725625,805

4,803,832

1922

$9,103

1,76444,364

1,388,090256,293

3,897,07125,007

5,3817,597

203,577

84768

3144

12,7303,429

5,855,405

1,576,514166,606

11 months endingNovember.

1921

$370177,634

5,250,3472,4747,767

16,4716,604

1,186,219

3,551,3851,947,578

37,407,525306,083

18,5921,702,117

164,1694,802,827

3,8663,2438,004

12,368383,019

39619,9564,542

169743,042

57,726,767

206,002708

1,512,0031,894,282

1,240,856

2,200

6,599,171

11,712,1433,934,494

284,8432,046,197

421,614239,500

10,253,2643,149,057

528,0008,402,2243,458,116

900

44,430,352

1922

204,494707,137

11,732116,485

1,790

199,073

6,051,7061,377,940

43,251,880537,829

6,1491,518,073

241,3686,999,579

2,1673,6387,817

530,80875

10,4771,456

12,7881,163,635

62,959,083

6008,787,6132,087,011

7,3502,087 351

805 70317,932,2149,857,305

1,320,00012,561,625

47,237371,111

55,894,086

DISCOUNT RATES OF FEDERAL RESERVE BANKS IN EFFECT DECEMBER 31, 1922.


BostonNew York.. . .Philadelphia.ClevelandRichmondAtlanta

.ChicagoSt. LouisMinneapolis..Kansas City..DallasSan Francisco

Paper maturing within 90 days.

Secured b y -

Treasury notesand

certificates ofindebtedness.

United Statesbonds and

Victory notes.

4444444*4§

I444*4

Tradeacceptances.

444i4444444*4*4444444

Commercia .agricultural,

and live-stockpaper, n. e. s

444444444444444444444

Bankers'acceptancesmaturing

within3 months..

Agriculturaland live-stock

papermaturing

after 90 days,but within0 months.

4444444444444444444

4444444444444444444


JANUABY, 1923. FEDERAL RESERVE BULLETIN. 127

GOLD SETTLEMENT FUND.INTERBANK TRANSACTIONS FROM NOVEMBER 24, 1922, TO DECEMBER 28, 1922, INCLUSIVE.

[In thousands of dollars.}


BostonNew YorkPhiladelphia...ClevelandRichmondAtlantaChicago ,St. LouisMinneapolisKansas City....Dallas ,San Francisco..

Total, 5 weeks ending-Dee. 28,1922Nov. 23, 1922Dec. 29,1921Nov. 23, 1921

Transfers.

Debits. Credits.

17,00020,0004,000

5001,0007,000

21,0004,000

500

3,000

78,00086,000

181,617178,866

47,0001,0007,000

1,50010,5001,000

6004,000

5,500

78,00086,000181, 617178, 860

Daily settlements.

Debits.

583,3482,256,858

783,051

590,974255,654

1,123,959570,142167, OK I411,005245,222316,663

Credits.

618,7822,230,426

783,515638,578577,380273,657

1,116,756563,100167,852401,261243,718315,455

7,930,480 ! 7,930, 4808,375,343 8,375,3436,577,616 6,577,6166,329,987 6,329,987

Changes in ownershipof gold through trans-fers and settlements.

Decrease.

2,536

14,594

17,70310,042

5,7444,504

55,123

Increase.

18,434568

18,493

i2,"503

4,292

55,123

Balance infund atclose ofperiod.

35,958195,97410,444

17,10019,42937,61314,95322,08529,67813,71037,548

516,580653,862541,973425,831

MONEY IN CIRCULATION DECEMBER 1, 1922.

[Source: United States Treasury Department circulation statement.]

Kind of money.

Gold coin and bullionGold certificatesStandard silver dollarsSilver certificatesTreasury notes of 1890Subsidiary silverUnited States notesFederal reserve notesFederal reserve bank notes.National bank notes

TotalComparative totals:

Nov. 1,1922Dec. 1,1921April 1,1917July 1,1914Jan. 1,1879

Stock of money inthe United States.

i S3,908,616,9852(687,677,239)

428,274,4042(330,623,591)

2(1,490,323)269,664,609346,681,016

2,718,474,01049,044,400

761,499,127

8,482,254,551

8,438,661,6238,156,446,9835,312,109,2723,738,288,8711,007,084,483

Money held bythe United StatesTreasury and theFederal Reserve

System.

13,491,973,577433,947,295367,512,57545,210,055

1,00026,913,81168,827,445

406,050,1416,542,892

38,558,854

3 4,885,537,645s4,879,914,1403 4,777,506,7373 3,896,318,6533 1,843,452,323

3 212,420,402

Money in circulation.

Amount.

$416,643,408253,729,94460,761,829

285,413,5361,489,323

242,750,798277,853,571

2,312,423,86942,501,508

722,940,273

4,616,508,059

4,570,280.8274,561,218,9024,100,590,7043,402,015,427

816,266,721

Per capita.

$3.772.30.55

2.58.01

2.202.52

20.94.38

6.55

41.80

41.4441.9339.5434.3516.92

1 Does not include gold bullion or foreign coin outside of vaults of the Treasury, Federal reserve banks, and Federal reserve agents.2 These amounts are not included in the total, since the money held in trust against gold and silver certificates and Treasury notes of 1890 is

included under gold coin and bullion and standard silver dollars, respectively.3 Includes gold held in trust against gold certificates and standard silver dollars held in trust against silver certificates and Treasury notes of

1890, the aggregate of which should be deducted from the sum of money held by the United States Treasury and the Federal reserve system andmoney in circulation to arrive at the stock of money in the United States. The amounts of such gold and silver held in trust as of the date of thisstatement are shown in parentheses in the first column.


DISCOUNT AND INTEREST RATES.In the following table are presented actual discount and interest rates pre-

vailing during the 30-day period ending December 15, 1922, in the variouscities in which the several Federal reserve banks and their branches arelocated. A complete description of the several types of paper for whichquotations are given will be found in the September, 1918, and October, 1918,FEDERAL RESERVE BULLETIN.

A comparison of the discount and interest rates prevailing in various centersduring the 30-day period ending December 15 and the 30-day period endingNovember 15 shows relatively little change. The upward tendency whichhas been noted during the past few months is barely apparent, and only in thecases of prime commercial paper and interbank loans. Compared with thecorresponding period last year, all rates are lower.

DISCOUNT AND INTEREST RATES PREVAILING IN VARIOUS CENTERS DURING THE 30-DAY PERIOD ENDING DECEMBER 15, 1922.

tooo

District.

No. 1..No. 2..No. 3..No. 4..

No. 5...

No. 6...

No. 7...

No. 8...

No. 9...

No. 10..

No. 11..

No. 12..

City.

BostonNew York..BuffaloPhiladelphiaCleveland...PittsburghCincinnati.RichmondBaltimoreAtlantaBirminghamJacksonville.New OrleansNashvilleChicagoDetroitSt. LouisLouisvilleMemphisLittle RockMinneapolisHelenaKansas CityOmahaDenverOklahoma CityDallasEl PasoHoustonSan FranciscoPortlandSeattle

Salt Lake City.Los Angeles

Prime commercial paper.

Customers'.

30 to 60days.

H. L.5}

5} 56 5 6

4 54J65} 66 75 5}7 85 6

7} 5 6}8 5 6-7•9 t i l

4 to 6months.

H. L. C.5} 5 516} 4} 4J-56 5 66 4} 57 41 66 5} 66 5} 66 5 66 5 5}7 4} 68 5 6-77 6 77} 5 6

Open market.

30 to 60days.

H. L. C.

5} 4} 4J-S5 55} 4} 4J

5} 56 5 66 4 56 5 66 6 68 6 76 58 7

6 86 65 5-5*4 |6

5 76 7416

7 5 671 5 6}8 5 5-7

10 6 76 5 6

10 8 87 66 58 5

I 8 4} 7! 8 6 6}-7! 8 6 7(12 41 5J

5J-66

5J 41 51

41 4 4J8 4 4f-66 41 54 | 4i 4J

5 4J

5 4f 54J 4f 4f8 7 7,5 4 45 4,5 4;

5 5 5J5J 4 41

4 to 6months.

H. L. C.5 414J51 4} 4J-55 o51 4J 4j

4f 4 } 4 |6 51651 4} 51

41 4 418 4 4j-(6 4J 54J 41 41

5 4f

b"4i4} 4}

5 4} 5

5 5110 8 8

Interbankloans.

H. L. C.51 4i 56 41 58 5 6 - 76 5 5

6 5} 66 5 5-5}6 4} 66 5 5}8 5 68 5 66 6 66} 5 6

5

5 5,5 66 66 6

5-5}

Bankers' acceptances,60-90 days.

Indorsed.

H. L. C.4 4 44} 4 4£-4}

6 4} 54 | 4 | 4}4 4 45i5|5J

6i 4 4

7 5 68 6 78 6 68 6 76 5 5}9 6 87 5 66 5J 5}7} 6" 77 6 6}8 6 77 6 67 5 6

4J 41 4}

4 41 41

Unin-dorsed.

H. L. C.44 4 4

6 4} 54|4J4i4 4 45|5}5|

7 7 7

6} 4} 5

4 4 4

Collateral loans—Stock exchange.

Demand.

5 6

H. L. C.5} 5} 516 4 5767 5 66 5 66 5 51-66 5 66 5 5}8 4} 68 5 5-67 6 78 4*51

7 6 6

4} 4 47 4J 416J 5} 517 6 7

i 4} 4 4

7 6 7

41 3} 4J

6 5 5-5}6 6 6

??§*6 6 68 6 7

7 5 671 5} 6}8 5 6

10 3 68 6 6*

10 8 87 6 76 5 51-68 4 78 41 78 6 7

7

3 months.3 to 6

months.

H. L. C.6 5 5}6 41 57 5 66 5 57 5 66 5 66 5}6 5 66 5 5}8 4} 68 5 5-67 6 78 5 6

H. L6 56 4}6 56 57 56 56 5}6 56 58 4} 68 67 6 '8 5} i

6 5 5-5}6 5 6

???6 6 68 6 76 6 6

7}8 78 5

10

, 6}6

4} 4 41 7 4} 6

78

6 75 66 76 76 77 75 6}

6 5 5}6 5 66 4J 5}6 5 66 6 68 6 76 6 68 7 78 5 6

???10 6 88 6 7

10 8 88 6 7

8 68 6

777

7 75 61

Cattleloans.

H. L. C.

6 5 5}

7 5} 6

7} 7 7}8 6 68 6 78 6 7

10 6 88 8

10 8 88 6 66 6 68 6J 76 6 68 7 88 7 78 6 6}

Secured bywarehousereceipts.

H. L. C.

5J 5 —7 6 76 6 66 5 66 5 66 5} 5J8 5 68 68 6 77} 5 6

6 5 5-5}6 6 66 5 66 6 66 6 68 6 76 6 68 8 88 5} 68 6 78 6 7

10 6 8

t6 6 68 6 78 6 78 6} 6}8 8 8

10 6 6 |

10

Ordinaryloans to

customerssecured by

Libertybonds.

H. L. C.514*55} 4} 41-5

6 4J 56 5 66 6 66 5 5-5}6 4}66 5 5}8 5 68 6 6-77 6 77 5 6

5} 4} 56 5 66 4} 5}6 5 66 6 68 6 75} 5} 5}

7 5 67 6} 6}8 5 6

10 6 78 5 6}

10 8 88 6 66 5} 5}8 6 78 6 78 6 67 6 78 5 61

W

i Bates for demand paper secured by prime bankers' acceptances—high, 5}; low, 3}; customary, 4-5.



FOREIGN EXCHANGE IN 1922.

The outstanding feature in foreign exchangeduring 1922 was the precipitate fall of the Ger-man mark. From an average rate per hundredmarks of 52.6 cents in December, 1921, it fellsteadily to an average of about 1.4 cents inDecember, 1922, which is about one-sixteenhundredths of its parity of 23.8 cents per mark.

Sterling rose steadily during the year, froman average of $4.16 in December, 1921, to $4.61in December, 1922, or from 85.4 per cent to94.7 per cent of parity. This improvement re-flects in part shipments of over $100,000,000 ofgold from Great Britain to the United States,the general improvement in the British finan-cial position, and the decline of British pricesfrom 20 per cent above to slightly below theAmerican level.

The course of the French and Belgian francsand of the Italian lira during 1922 was similarto that of the preceding year, but during thefirst half of 1922 all three currencies were on asomewhat higher level. During the latter halfa decided decline of the franc is noted, duemainly to unfavorable developments in the Ger-man reparation situation. A slight recovery inDecember brought the French franc to 7.23cents, compared with 7.84 cents in December,1921. The lira, with an average of 5.03 centsfor December, stood somewhat higher than ayear ago. Neutral European exchanges gainedduring the year, both the Swiss franc and theDutch florin going somewhat above par for ashort time.

Canadian exchange rose from an average of92.77 cents in December, 1921, until it prac-tically reached parity in August, 1922. Octo-ber and November averages were slightly abovepar, but the December average receded to 99.45per cent.

Of the leading South American exchanges,the Argentine and Chilean pesos improved con-siderably. From December, 1921, to Decem-ber, 1922, the Argentine peso rose from an aver-age of 74.8 cents to an average of 85.6 cents,and the Chilean peso from 10.8 cents to 12.4cents. The Brazilian milreis, after a rise dur-ing the earlier half of the year, declined to 11,9

cents in December, compared with 12.7 cents inDecember, 1921.

The price of silver per fine ounce in the NewYork market rose from 66 cents in December,1921, to 72 cents in May, 1922, and then de-clined to 64 cents in December. Shanghaitaels followed a course similar to that of silver,rising from 75.3 cents in December, 1921, to ahigh of 79.02 cents in June, 1922, and averaging71.04 cents for December. Indian rupees rose

GERMAN MARK RATE( PER CENT OF PAR )

8.06.05.04.03.0

1.00.80.60.50.*0.3

0.2

0.10.060.060.05O.040.03

0.02

1=*d '

\

i

1

- :

Â

1

\\

1

\

8.06.05.04.03.0

1.00.8O.6O.50.40.3

0.2

0.10.080.060.050.040.03

0.02

J . F. M. A. M. J . J . A. S. O. N. D. J. F. M. A. M. J. J A. S. O. N. D.

1921 1922

from 27.45 cents in December, 1921, to 30.65cents in December, 1922, owing to improvedconditions in India and to the advance m ster-ling. Japanese yen remained fairly steadythroughout the year, with fluctuations between48 and 49 cents per yen.

The general foreign exchange index, based onthe weighted average of 17 leading countries notincluding Germany, rose from 64 for December,1921, to 70 (preliminary) for December,i1922.



FOREIGN EXCHANGE INDEX1918 - 1923

-GENERAL INDEX (EXCLUDING GERMANY)-ENGLAND

—•FRANCEITALY

- - - . - - ~ — ~ NETHERLANDS

•ARGENTINA-JAPAN

CENT

110

PAR

90

SO

70

60

50

40

30

20

10

- 0N. D.

1318J.F. M. A. M. J. J. A. S. 0. N. D. J. F. M. A. M. J. J. A. S. 0. N. D. J. F. M.A. M. J. 0. A. S. 0. N. D. d. F. M. A. R J. J. A. S. 0. N. D. J. F. M.A. M.J. J. A. S. 0. N. 0.

1919 1920 1921 1922 1923

FOREIGN EXCHANGE BATES.

[General index for December, 1922, 70 (preliminary); for November, 1922, 67; for December, 1921, 64. Noon buying rates for cable transfers inNew Yon u> published by Treasury. Rates in cents per unit of foreign currency.]

COUNTRIES INCLUDED IN COMPUTATION OF INDEX.

Monetary unit.

BelgiumDenmarkFranceGreat BritainItaly . ,NetherlandsNorwaySpain ...Sweden .•Switzerland

Franc."rone..

Franc.Pound.Lira..Florin..Krone..Peseta.Krona..Franc.

Par'ofex-

change.

Canada Dollar

Argentina j Peso (gold)Brazil j Milreis ,Chile j Peso (paper) |

China j Shanghai taol . . . *66.85India Rupee 48.66Japan Yen 49.85

19.3026.8019.30

486.6519.3040.2026.8019.3026.8019.30

100.00

96.4832.44

2 19.53

Low. High.

Decem-ber.

Novem-ber.

" l -6.4200

20.38006.9700

451.98004.8200

39.520018.490015.360026.900018.7100

Decem-ber.

5.640020.13006.2000

444.88004.0600

39.0700 i18.1900 !15.160026. 760018. 2100

98.5605 ! 99.9236

6.950020.99007.6100

467.99005.1300

40.130019.240015.790027.030019.0000

99.9S74

83.7500 [ 81.5100 I 86.370011.6200 I 11.2700 | 12.240011.8500 11.8100 i 13.0500

70.4500 ! 70.430030.030048.5100

29.100048.1000

72.070031.110048.9900

Novem-ber.

6.760020.41007.2100

452.10004.8200

39. 580018. 540015.390026.960018.7900

Average.

Decem-ber.

84.050012.620013.4200

73.840030.060048. 5200

6.644820.67007.2296

460.98005.034039.836818.939615.635626.948418.9100

100.1014 i 99.4484

85.568811.945212.1064

71.044430. 648848.8500

Novem-ber.

6.370020.20716.8583

447.99214.5063

39.272918.365815.275026.844218. 4358

100.0290

82. 22S311.948812.3825

71.872529. 510848.3729

Index (per centof par).1

Decem-ber.

Novem-ber.

34.4377.1337.4694.7326.0899.1070.6781.01

100.5597.98

88.6936. 8263.52

106.2762.9997.99

33.0175.4035. 5492.06.23.3597.6968.5379.15

100.1695.52

99.45 j 100.03

85. 2336. 8363.40

107. 5160.6597.04



FOREIGN EXCHANGE RATES—Continued.

OTHER COUNTRIES.

Monetary unit. Par ofexchange.

Austria i KroneBulgaria ! LevCzechoslovakia j KroneFinland i MarkkaGermany i ReichsmarkOreece ! DrachmaHungary KronePoland Polish m a r k . . . .Portugal | EfcudoRumania ' Leu

Low. High.

20.2619.30

Cuba i PesoMexico do.

Uruguay do..

China i Mexican dollar..Hongkong Dollarstraits Settlements • Singapore dollar.

19.3023.8219.3020.26

108.0519.30

19. 30

100.0049.85

Decem-ber.

0.0014.6783

2. 72562. 488S

.01181.0000.0396. 0054

4. 2500. 5775.2681

1.0750

99. 887548. 3125

103.42 i 80.9800

M 8 . l l2 47.77

56.78

51. 420052. 500051.9600

Novem-ber.

0.0013.0550

3.15002.4975

.01181. 4300. 0399.0060

4. 3400.6169.33191.3329

99.8063 I48.2625 I

Decem-ber .

0.0014.7180

3.18782. 5263

.01861.4200. 0437.0060

4. 8500.6338.3497

1.4014

100 050048. 7625

Novem-ber.

0.0014.7000

3.24392.7463

.02242.0400.0429.00726. 4100.6628.41281.6500

99.925049.7344

77.5500 ! 85.4500 I 81.1300

51. 330052.930051. 7500

52. 9000 I54. 050053. 6700

53.830055.130052.3300

Average.Tndex (per cent of

par).'

Decem-ber.

0.0014.6997

3.09692. 5124

.01361.2337.0430.0057

4. 5212.6111.3047

1.2231

99.945048. 4468

84. 2120 |

52.0288 I53. 228853.0100

Novem-ber.

0.0014.6835

3.17582.5609

.01471.5925

.0413

.00654.9921

.6417

.39121.5691

99.877948.7620

79.4613

52.484253.815052.005S

Decem-ber.

0.013.63

13.02.06

6.39.21

4.183.17

6.34

99. 9597.19

81.43

108.15111.4393.36

Novem-ber.

0.013.54

13.27.06

8.25.20

4.623.32

8.13

99.8897.82

76.83

109.09112.6591.59

1 Based on average. U913 average.

SILVER.

[Average price per fine ounce.]

December. November

London (converted at average rate of exchange)New York

$0.65104.64250

JO. 66331.65485


132 VKDEUAT., KESIUiVE BUIJ.KT1K. . IAN'UAUY, 19:2".

FINANCIAL STATISTICS FOR PRINCIPAL FOREIGN COUNTRIES.A summary of banking and financial conditions abroad is presented statistically in the

accompanying tables.ENGLAND.

[Amounts in millions of pounds sterling.)

Deposit and note ac-counts, Bank of ling-land and Treasury.

Nine London clearinghanks."

Government float-ing debt. Discount rates.

Year andmonth.

Average of end otmonth figures:191319201921

1921, end of—November..December..

1922, end of—JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember.OctoberNovember .December..

29103108

106107

103102103102103103104103101101102104

as§3

348327

31332<i

3052983003032982952962932892X7288301

I57

147136

144123

135138151134130i;u122124121125121133

38146157

157157

157157157157157157154154154154154154

114111103107109113no10510410598

3 I

" 6

sa 2S 2

! S3= x i

i 1 Ii

1,176 309 [ 1,768

,205,191

,192,152,097,06.',,061, 070,056,020,007,033

1,031

311315 !

333 i357369 j3783U23883863»0381370365

1,793 '1,818

1,8261,8021,7471,7371,7451,7551,7301,6881,6601,6861,667

15 i1,0781,139

1,108 :1,060 J

1,039957 I882 |759 '771761 j755715724 !740732719

200

116112147193172205159153 IUS179ISO222

1,21171,322

i,260

1,1541,0691,030

95194396.'.914868872919911941

Percent.

6J

n \ n38 I 3J

313ft

282H2!I l l2^

2«"2J24

H . m

Per i P«reen(. ! cent.

4J 1 1JJ6T'« ! 7,'j515 «1

32k2iif1A2J

f

2*

©

99.51)110 07

112.4112. 1

118.2118.0118.3118.0118.2118. 2120.3121.3122.7123.0124.6125.8

ban

urn-

Q 2o"8§

1,3703,2522,911

2,9213,173

3,3993,0883,4523,3053,3072,9173,2362,8852,6903, 1242,9892,769

o

oa%

Percent •11.715.210.3

6.1

"7.2'

5.9

mbe

t

3

sV.

1

100.0

102.1105.8107.311.3.3113.1112.8111.1114.7114.0

214033

7173

1587140100522943217311915

1 Less notes In currency notes account.! Held by the Bank of England and by the Treasury as note reserve.s Average weekly figures.* Statist figure revised to exclude Germany.» Compilation of London Economist. Ratio of net profits to ordinary and preferred capital of industrial companies, exclusive of railways,

mines, insurance companies, and hanks. Applies to earnings disclosed during the quarter aud has therefore a probable lap of six months.• Compilation of the Bankers Magazine.7 Compilation of the Statist.

FRANCE.[Amounts in millions of francs.1

Year and month.

1913, average.1920, average.1921, average.


1922.JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember

Bank of France. Government finances.

Goldreserves.

3,3433,5863,568

3,5753,5763,576

3,5763,5773,5783,5793,5793,5803,5823,5833,5843,6353,6363,670

Silverreserves

629253274

278279280

280281282283284285285286287288289289

De-posits .-

8303,5272,927

Circula-tion.

5,56538,06637,404

Advancesto the

Govern-ment forpurposes

ofthe war.

Govern-ment

revenue/

2,563 37,151 ,2,563 36,3362,743 36,487

2,3922,4292,2362,412 j2,3032,4182,4322,170 I2,199 :2,1702,184 I2,309 J

36,43336,151 !35,52835,787 i35,982 !36,039 !36,050 :36,385 !36,603 j36,691 I36,111 I36,359 j

26,00025,300

25,10024,50024,600

23,00022,50021,50022,10023,10023,30023,00023,90021,00023,60022,90023,600

3201,0051,103

1,3051,0511,228

1,3231,0111,1541,3811,1761,2251,4721,1681,1541,5031,207

Bonsdela

DefenseNa-

tionale.'

Internal Externaldebt. debt.'

i Price of3 per

cent per-petualrente.«

35,000 8677 I! 57.34 I

56.56

Averagedaily

clearingsof theParis

banks.

59'- 554

550

35,286

1 242,758 ! 34,779

60,839 j 213,85761,528 i62,890 I

62,52562,93663,101

218,283

35,716

35,685

54.3054.9054.75

56.5559.5556-7057-6057.7057-9558.2560.1061.1058.2559.0059.02

Savingsbanks,excessofde-

posits(-l-)or

with-draw-

als (-).

- 6 5+18+ 67

Value ofnew

stockand bond

issuesplaced

upon theFrenchmarket.

1,6541,100

463505527

+33 i- 0 . 5 1+38 1

3 ,355434853

489489455411451171562512484556

+41+ 100+19+58+55+53+62+66+58+ 17+13

5,062377159644947485151636421

»Not including gold reserve held abroad.2 Includes Treasury and individual deposits.' Foreign debt converted to francs at par.

' Figure for the last Wednesday in the month.s Average for 11 months.8 Estimate in the French Senate.



ITALY.

[Amounts in millions of lire.]

Year amimonth.

1913,end of Dec1920,endof Deo.1921, average..1921, end of—

October . . . !November.,December .>

1922, end of—January . . .February..March IAprilMay. . 'June. .July |August jSeptember.1

October....November.!

Loansanddis-

counts.

8577,0747,509

7,8lti7 810

10,020

10,15(510 0299,833

10 113!>, 323D,.r.05!), O.'l0 OHO8,8018 5018, («25

(ioldre-

serve.

j .175,058, 07-1

, 08B089

,092

,109I 100

118122104

,106,125

125125136

,141

Banks of issue.

Totalre-

serve.

1 6612,0772 O'O

1,9901 9481,999

1,9961,9711 9561 9041,9631,9761,9912 0242 0242 0392,034

Depos-its and

de-mandliabili-ties.

3182,5632 352

2,2432 1512,913

2,8482 5622 6872 4732 5722,7402,5242 6052 4992 6412,480

Com-mer-cial

circu-lation.

2,2848,9889,304

9,7469 435

10,304

10,1839,6319,5899,3609,2599,6159,9479 6959,9249 7829,892

Circula-tion foraccountof thestate.

10,7439,061

8,5548 4858,505

8,5708,6268,5238,3508,0818,0498,0508 0508,0668 0758,074

Leading private banks.1

Cash.

1291,3081,200

1,3641 1741,997

1 4261 081

965908841845861763769

Loans,dis-

counts,and

due fromcorre-spond-ents.

2,00716,53916,242

17,18512 84411,797

11,33411 44611,40711,75211,73211,98012,11812 16412,106

Depos-its anddue tocorre-spond-ents.

1,67415,81016,001

17,022'12 77812,502

11,61611 48211,40311,70811,69811,86311,89611 88311,897

Statecur-

rencynotes.

4992,2682 267

2,2672 2672,267

2,2672 2672,2672,2672,2672,2672 2672 2672,2672 267

Government finances.

Treas-ury

metal-lic re-serve.

117161170

159159170

170170170170169170170

Short-termtreas-ury

bills.

13,200

22,997

24,600

24,108

25,202

Totalpublicdebt.*

110,754

111,900

113,204

Princi-pal

reve-nues

duringmonth.3

1,019

1,401648

1,458

9091,366

7591 337

6671,454

7831 306

6821,354

730

Index

bers ofsecuri-ties

prices.'

87 12

91.0783 9980.13

96.6194 1088.8288.4393.1394.8395. IS

103 01105.68109.90111.94

1 Includes Haiioa Commerciale Italiana, Credilo Italiano, Banco di Roma, and Banca Italiano di Sconto until November, 1921.- Includes paper circulation of the State and of banks on account of the State.3 Revenues from State railways; from post, telegraph, and telephone; from State domain; from import duties on grain; and from Govern-

ment sales of sugar are not included from November, 1921.' Figures for IU2I Iwsed on quotations of Dec. 31, 1920-100; those for 1922 on quotations of Dec. 31, 1921=100.

GERMANY.

[Amounts In millions of marks.)

Reicbsbank statistics.

Veul* andmonth. (iold

re-serve.1

1913, a v e r a g e . . . ! 1,0681920, a v e r a g e . . . ; 1,0921921, a v e r a g e . . . j 1,056


Dis-countedtreasury

bills.

Com-mercialpaper.

dis-i:ounted.

47,98083,133

1922. •January !FebruaryMarch !April iMayJuneJuly |August jSeptember !OctoberNovemberDecember

994995

996996997

I 0011,0031,0041,0051,0051,0051.0051,0051,007

114,023132,331

12U,16J131,252146,531155,618167,794186,126207,858249,766349,770477,201672,222

1,184,464

I

1,4461,062

1,5921,8572,1522,4033,3774,7528,122

21, 70450,234

101,155246,919422,235

Notecircu-

lation.1

1,95853,96480,952

100,944113,839

115,376120,026130,671140,420151,949109,212189,795238,147316,870469.457754,086

1,280,095

Deposits.

17,70220,213

Clearings.

0,13657,89889,297

Government finances.

Darlehns-kassen-scheinein circu-lation.1

13,1458,861

Receiptsfromtaxes.

207

6,285

Revenueof staterailways.

Treasurybills out-standing.1

13

2,358

= 220

25,31332,906

23,41226,52633,35831,61633,12837,17439,97656,124

110,012140 779240,969530,526

140,493120,835

116,680109,816170,357175,977179,370191,414243,493374,856473,715

7,3308,325

8,0467,9778,7019,1839.440

10,37412,23413,38313,99514.00913,80913,450

7,0448,016

8,8029,014

14,06513,19317,61917,77621,54731,46631,09250,175

103,658

3,3974,329

4,4154,6597,0968,997

10,98412,78115,39618,05325,33258,161

192,832

226,676246,921

255,678262,817271,935280,935289,246311,600307,810331,000451,000614.000839.000

, 1,495,000

Index of securi-ties prices.1

25stocks.

«269'206

223222274205242224282299445653

2,1232,669

Value ofnew stockand bond

15bonds.

• 181»147

placed onGermanmarket.

• End of month.2 End of March, 1913.3 Calculated by the Frankfurter Zeitung with prices of 25 stocks, 10 domestic and 5 foreign bonds (prices as of Jan. 1, 1921 = 100).

figures, recently revised, now include subscription privileges which were heretofore omitted. Figures are as of beginning of month.< As of Nov. 10,1921.

As of Dec. 30, 1921.

2,658

7,1355,965

152154169268297298430662

1,9332,6624.«25,119

4,8312,1016,4163,9924,1522,7622,3302,4687,9377,187

15,223

These


134 FEDERAL RESEBVE BULLETIN. .lANUARl', 1923.

NORWAY.

[Amounts in millions of kroner.]

Year and month.

1914, end of J u l y . . . .

1921,average.1921, end of—

1922, end of—

AprilMav

July

October

Goldholdings.

•84147147

147147

147147147147147117147H71471-17147

]

Notecirculation.

123451417

395410

378376385386

385382385384383372

Gorges Bank

Deposits.

14102111

121-141

131141151143152133137133135173141

Loans anddiscounts.

8<!419443

439476

433428449447446441445445444490446

Clearings atChristiania.

652537

538551

524494628516525532466468447581

Private commercial banks (103).

Loansand

discounts.

3,9213,840

3,(1773 508

3 4133,3463 2803,3023,3073,3543,3643,2953,2603,1782,172

Deposits

3,3823,338

3,2313,305

3,2023,1723,1243,1183 0863,0803,0833,0363,0042,9362,887

Totalaggregateresources.

5,164

5,1134,944

4,8054,7554,6904,7554,7834,8044,8104,7814,7374,6364,640

Bankrupt-cies.

Number.

3286

8884

8987

10778

129946879597273

1 Includes balances abroad.SWEDEN.

[Amounts in millions of kronor.)

Year aud mouth

1913, end of December..1920, average1921, average1921, end of—

OctoberNovemberDecember

1922, end of—JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovember

(Joldcoina u dbul-lion.

102269280

276275275

275274274274

' 274274274274274274274

Notecircu-lation.

235733661

650628628

563579626582567585551559605569575

De-posits

108226193

126188331

337346312301293247243213180178191

Clear-ings.

5853,5962 715

2,3102,3643,305

2,3322,1222,3541,9362,1622 1182 0151,8C31,9021,995

Joint-stockbanks.

Billsdis-

countedwithRiks-bank.

139476389

341354464

421429447404380320307293288206252

Loansand dis-counts.

2,2876,0085 948

5,8375, 7355,656

5,6545,5725,4745,4305,3785,3885,2685 2215,1815,1495.099

Governmentfinances.

FundedStatedebt.

6281,281

1,3931,4091,433

1,4341,4351,4351,4341,642

Float-ing

Statedebt.

20248

637778

8487909297

foreignei-

cbangeindex,

value ofkrona

abroad(foreign

cur-rencies

112.9121 8

124.9124.0126.3

126.6129.2128.3126.6121.8125 6127.0128.8130.5131.7132.2

Protested

during month.'

Num-ber.

4,3143,5866,907

6,4496,0896,298

6,3456,2727,5596,9657,5816 5996,4175,4614,9935,3575,009

Value.

26

15

131310

91013121010126564

Busi-

fail-ures

duringmonth.'

309196432

505491528

509398513400430^62374300371335353

Index

ber ofstock

prices-A list. '

258176121

107104107

1099489

1001151131131101039890

Valueofstock

regis-tered

duringthe

month.

246131

17IS21

18ia291550633522141559

1 Source: Kommersiella Meddelanden.


JANUARY, 1923. KKDERAI, RESERVE JUII.LBTXN. 135

JAPAN.'

[Amounts in millions of yen.]

Year and month.

1913, average1921, average

1921.Knd of—

NovemberDecember

1922.I!nd of—

JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecember

Capitalpro-

jected.

2,2462,4383,0992,8093,1433,1782,7662,5822,7502,6972,971

9.029.029.099.349.429.459.389.429.389.38

1,362 j1,359 !1,3591,3591,3591,3591,3591,359

2,1622,1852,2352,2642,2412,2772,3042,369

1,3771,2461,2891,2261,2031,3441,2241,2801,2371,2361,2411,590

1,2411,2231,2891,2631,2031,2231,2201,1321,0691,0681,0661,064

1 Figures apply to last day of month in case of Bank of Japan to last Saturday of the month for other items.' This includes the specie segregated against notes only. It includes gold credits abroad as well as bullion and coin at home.3 During January, February, April, October, November, and December, 1913, Government deposits averaged 4,198,000 yen. During the rest

of the year there was an average monthly overdraft of 8,942,000 yen.«Tokyo market.

Year and month.

End of—1913..1919..1920..1921..

End of—OctoberNovember.December..

End of—JanuaryFebruary..MarchAprilMayJuneJulyAugustSeptember.October

1922.

ARGENTINA.

[Amounts in millions of pesos.]

Banco de la Naeitfn.

De-posits

(paper).

5411,2501,4121,310

1,3111,2931,310

1,3101,3101,2721 2831,2941,3291,3221,3531,3461,328

Dis-counts

andad-

vances(paper).

478676804866

S03840866

S87913884887906933920946950921

Cash.

Gold.

32392523

TJ2323

2323239'}232323232323

__ __

Pa-per.

180268406410

448463410

419383383393386395399407402405

De-posits

(paper).

1,4643,0103,5303,375

3 3913,3593,375

3,3623,3623,3133 3043,2783,3263,3083,3563,3793,354

Banks.1

Dis-counts

andad-

vances(paper).

1 5412,1132,5052,543

2 4672,5012,543

2,52!)2,5652,5122 4892,4612,4612,4732,4912,5142,549

Cash.

Gold.

62664636

363636

36363636353535353535

Paper.

435771

1,0811,087

1,1721,1501,087

1,064994981999

1,0161,0601,0131,0411,0481,028

Caja de Conversi6n.

Note

lation(paper).

8231,1771,3631,363

1,3631,3631,363

1,3631,3631,3631 3631,3631,3631,3631,3631,3631,363

Goldre-

serve.

263320476476

466466466

466466466466466466466466466466

Goldbonds

de-posited

inlega-tions.

7944

444

44

4

Clear-ingsin

BuenosAires

(paper).

1,4712,8053,6123,045

2,9092,1333,482

3,0142,5933,298

3,0162,7162,8142,5702,7252,827

Liabili-ties ofbank-rupt-cies

duringmonth(paper).

1435

12

161313

10t

It1113

*77

1(11

> Including figures of Banco de la Nacidn.


INDEX.

Acceptances: Page.Held by Federal reserve banks 109Purchased by Federal reserve banks 107

Agricultural movements, index of 96Argentina:

Banco de la Nacion, condition of 71Bond issues 70Business and financial conditions 69,135Business failures 69Foreign trade 69Government finances 70Wool exports 69

Australia, wholesale prices in 82Austria, cost of living in 86Automobile financing 41Bank debits 121Banking and credit during 1922 1Belgium:

Cost of living 86Wholesale prices 82

Brazil:Business and financial conditions 72Coffee crop 72Foreign exchange 72Foreign trade 72,91Government and State finances 73

Building statistics 100Bulgaria, wholesale prices in 82Business and financial conditions:

Argentina 69,133Brazil 72England 50,132France 53,132Germany 61,133Italy 133Japan 133Mexico 73Norway 133Sweden 133United States 7

Index of 95Canada:

Foreign trade 91Retail prices 86Wholesale prices 77, 79, 82, 85

Cannes Conference 31Charters issued to national banks 24Check clearing and collection:

Gold settlement fund transactions 127Number of banks on par list 125Operations of the system during December . . . 125Rehearing denied in Richmond par clearance

case 20China, wholesale prices in 82Clearing-house bank debits 121Commercial failures 93Condition statements:

Argentine banks 71Federal reserve banks 110,112Member banks in leading cities 110,117

Correspondent banks, deposits of member bankswith 25

Cost of living, foreign countries, index of 86Cotton fabrics, production and shipments 94Currency in circulation 127Czechoslovakia, retail prices in 86Debits to individual account 121

Denmark:Foreign trade 91AVholesale prices 82

Deposits of member banks with city correspondentsand Federal reserve banks 25

Deposits, savings, of commercial banks 92Directors of Federal reserve banks, election of 24Discount and open-market operations of Federal re-

serve banks:Acceptances held 109Acceptances purchased 107Bills discounted 106Bills held 108Earning assets held 108Number of banks discounting 106Rates of earnings 108Volume of 106

Discount rates:Federal reserve banks 126Prevailing in various centers 128

Dutch East Indies, wholesale prices in 82Egypt, wholesale prices in 82England:

Cost of living 86Financial statistics 132Foreign trade 89Index of industrial activity 87Prices, course of 50Wages 51Wholesale prices 50,78, 82, 84

Failures, commercial:Argentina 69United States 93

Federal reserve agents, election of 25Federal reserve banks:

Condition of 110,112Directors, election of 24Discount and open-market operations of 106

Federal reserve note account 116Fiduciary powers:

Exercise of, by national banks in Pennsylvania. 20Granted to national banks 24

Finance companies 37Foreign exchange index 129Forged Government check, opinion of court on

right of Federal reserve bank to charge back. . . . 22Foreign trade:

Argentina 69Brazil 72,91Canada 91Denmark 91England 89France 90Germany 90India 91Japan 91Netherlands 91Sweden 91United States 91

Index of 92France:

Bons de la defense nationale 53Financial statistics 132Foreign trade 68,90Index of industrial activity 87Internal floating debt 53

i


ii INDEX.

France—Continued.Retail prices in Paris 86Wholesale prices 68, 79,82, 84

Freight rates, ocean 93Germany:

Cost of living 86Financial statistics , 133Foreign trade 90Index of industrial activity 88Mark, stabilization of 45,61

Report of foreign experts on 45Reparations, review of past three years 29Wholesale prices 82,84

Gold imports and exports 18,126Gold-settlement fund transactions 127Imports and exports of gold and silver 18,126Index numbers:

Cost of living, foreign countries 86Foreign exchange 129Foreign trade 92Industrial activity—England, France, Ger-

many, Japan, and Sweden 87-89Ocean freight rates 93Physical volume of trade 95Retail prices in principal countries 86Wholesale prices abroad 77, 82Wholesale prices in the United S t a t e s . . . 78, 80, 82, 84

India:Cost of living 86Wholesale prices 82Foreign trade 91

Interbank deposits of member banks 25Interest rates prevailing in various centers 128Italy:

Financial conditions 133Retail prices 86Wholesale prices 82, 85

Japan:Financial statistics 135Foreign trade 91Index of industrial activity 89Wholesale prices 79, 82

Knit goods production 93Law department:

Petition for rehearing denied in Richmond parclearance case 20

Exercise of fiduciary powers by national bankslocated in Pennsylvania 20

Right of Federal reserve banks to charge backforged Government check 22

London Conference, third, August, 1922 33Manufactured goods, index of 96Mark, German, stabilization of 45,61

Report of foreign experts on 45Maturities:

Acceptances purchased 107Bills discounted and bought 107,115Certificates of indebtedness 115

Member banks:Condition of 110,117Deposits with city correspondents and Federal

reserve banks 25Number discounting 106Number in each district 106State banks admitted to system 24

Mexico, banking conditions in 73Mineral products, index of 96Money in circulation 127

National banks: Page.Charters issued to 24Fiduciary powers granted to 24

Netherlands:Foreign trade 91Wholesale prices 82

New Zealand:Cost of living 86Wholesale prices in 82

Norway:Financial statistics 134Wholesale prices 82

Ocean freight rates 93Par list, number of banks on 125Per capita circulation 127Physical volume of trade 95Poland:


Prices:Course of, in England 50Retail, in principal countries 80Wholesale, abroad 77,82Wholesale, in the United States 78,80,82,84

Rates, discount 126,128Regulation B, amendment to 19Reparations, German, review of, for past three

years 29Reserve ratio of Federal reserve banks I l lResources and liabilities:

Federal reserve banks 112Member banks in leading cities 117

Retail prices in principal countries 8GRetail trade, condition of 101Richmond par clearance case, rehearing denied . . 20Rulings of the Federal Reserve Board:

Amendment to Regulation B 19Savings deposits of commercial banks 92Silver imports and exports 18,126South Africa:


Spa agreement respecting German reparations 29Spain, wholesale prices in 82State banks admitted to system 24Sweden:

Financial statistics 134Foreign trade 91Index of industrial activity 88Retail prices 80Wholesale prices 82,85

Switzerland:Cost of living 86Wholesale prices 82

Trade:Foreign. (See Foreign trade.)Physical volume of 95Retail 101Wholesale 105

Treasury financing 5Victory notes, redemption of 5War savings certificates, redemption of 5Wholesale prices:

Abroad 77,82In the United States 78,80,82,84

Wholesale trade 105Wiesbaden agreement 30


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Federal Reserve Bulletin January 1923 - Fraser

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