NATIONAL BANKING UNDER THE FEDERAL RESERVE SYSTEM 
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3—The banks lacked adequate means for replenishing their reserves or increas- 
ing their loaning power under unusual demands. 
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Currency 
Bank note currency—the only form of currency which might be expected to 
respond by expansion and contraction to unusual needs—was deprived of elas- 
ticity because its volume largely depended upon the amount and price of United 
States bonds. 
Cooperation 
I—Banks lacked the means to insure such effective cooperation as was necessary 
to protect their own and the public’s interests in times of stress. There was 
no cooperation of any kind among banks outside of clearing house cities; 
2—The banks had no effective agency covering the entire country affording, 
necessary facilities for making domestic exchanges. 
Commercial paper 
{—Lack of commercial paper of an established standard issued for agricultural, 
industrial and commercial purposes, and available for investment by banks, 
had led to an unhealthy congestion of loanable funds in great centers, thus 
hindering production throughout the country on the whole; 
2—There was no open market for the discount of such paper; 
8—There was a disparity in discount rates throughout the country generally 
and there was in existence no agency, the influence of which could secure 
uniformity, steadiness and reasonableness in rates of discount. 
No banking facilities for emergency cases 
We had no effective agency that could surely provide adequate banking facili- 
ties for different regions, promptly and on reasonable terms, to meet the 
ordinary or unusual demands for credit or currency necessary for moving 
crops or for other legitimate purposes. 
Lack of uniformaty 
There was no power to enforce uniform standards throughout the country with 
regard to capital, reserves, examinations and the character and publicity of 
reports of all banks in the different sections of the country. 
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