Banking standards under the federal reserve system

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Monograph

Identifikator:: 1762969653

URN:: urn:nbn:de:zbw-retromon-142432

Document type:: Monograph

Title:: Banking standards under the federal reserve system

Place of publication:: Chicago

Publisher:: A. W. Shaw Company

Year of publication:: 1928

Scope:: xxxviii, 420 Seiten

Digitisation:: 2021

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part III. Correlated series for all Member Banks by districts

Collection:: Economics Books

242 BANKING STANDARDS 3. INDIVIDUAL EXPENSES The individual expense items of member banks, as distinguished in the reports of the Federal Reserve Board, are as follows: salaries and wages, interest on deposits, interest and discounts on borrowed money, taxes, and “other expenses.” Each of these expense elements has been examined as to norms and trends in Chapter VI. Moreover, the manner in which each of them is correlated with variable loans and discounts, deposits, and gross earnings, and so on, is discussed in the chapters relating, respec- tively, to these topics. Correlations of ratios of individual ex- pense items with ratios of total expense were not considered in Section 2 of this chapter, inasmuch as together they make up the total, and it is statistically inappropriate to correlate a total with any one of its parts. In view of the relations found to obtain between variable ratios of loans and discounts and of deposits,® and so on, with ratios of individual expense items—the respective items constituting the dependent, and the ratios in the other series, respectively, the independent variable—it is unnecessary to trace out the relations with the positions of the variables reversed. The type of asso- ciation between the series correlated according to the first is, in general, the same as that found according to the second method. The present analysis, therefore, relates to the association of paired deviations from district averages between the expense elements themselves, attention, because of the limited space available, being restricted to the following items: salaries and wages, interest on deposits, and interest and discounts on borrowed money. It is, of course, unlikely that there are direct functional relationships exist- ing between the separate elements of expense. On an a priori basis none would be expected. Correlations found to obtain are prob- ably indicative of mutually direct or inverse effects attributable to common causal elements—a phenomenon frequently encountered in social affairs. This fact is particularly true with respect to cer- tain correlated series; with respect to others, it is not so apparent. (1) Salaries and Wages By taking the seven-year average ratios of salaries and wages 8 See Tables 9%, 08, 111, 113, 121, 127, 131, and 133.

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