NORMS AND TRENDS IN GROSS EARNINGS 77

the control of banks individually and collectively. Each bank is
free, within certain common restrictions, to use its funds in the
manner most conducive to profit. Presumably it exercises such
restricted freedom, as financial prudence dictates, in increasing or
decreasing the proportion of its assets as between different forms
of revenue-producing agents. Loans and investments are available,
 but the returns upon them are determined by forces common
not alone to one market but to markets, integrated and overlapping,
 a fact which helps to explain why the tendency of regression
to type is not isolated but general.
Each district, as has already been indicated, has its own level
of gross earnings in terms of earning assets. About this level the
ratios fluctuate, the years which are high or low in one district
tending to be high or low in all districts. But what are the levels
for the respective districts? While the ratios themselves are given
in Table 50, the nature (plus and minus) and the percentage
amounts of variation from the averages for the country as a whole
are shown in Table 55 for each district for the combined and for
the individual years.
Based upon the seven-year period 1919 to 1925, the ratios in
Boston, New York, Philadelphia, Richmond, and Chicago are
lower than those for the country as a whole, while those for the
other districts are higher. Moreover, Boston and Philadelphia
are lower than the yearly country average for the full period of

TABLE 55

PERCENTAGE DIFFERENCES OF DISTRICT AVERAGES OF RATIOS OF
Gross EARNINGS TO EARNING ASSETS FOR ALL MEMBER
BANKS, FEDERAL RESERVE SYSTEM, FROM AVERAGES
FOR THE COUNTRY AS A WHOLE

PERCFNTAGE DrerweENCES FROM THE COUNTRV'S AVERAGES

FEDERAL
RESERVE
Di1sTRICTS

Average
010-25)

1910

1020

1021

922

IL

.Q24

102%

Boston. .....
New York. ..
“hiladelphia..
“leveland....
Richmond. . .:
Atlanta......
chicago. ....:
5t. Louis. . . .!
Minneapolis. .
Kansas City. .
Dallas. ..... |
San Francisco

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