The work of the Stock Exchange

Bibliographic data

Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

6526 APPENDIX is particularly strained indicates that there is little causal relation between the rates for call money and those on commercial loans.” In the Stabilization hearings (p. 368) Governor Benjamin Strong stated: “Here we have a large group of country banks which, for one or another reason, have funds that they cannot use locally or are anwilling to use locally. What are they going to do with them? They will not lock them up in cash in their vaults. They send them some- where for employment, in order to earn money on them. Also, when they are not members of the Federal Reserve system especially, they require balances in money centers in order to meet the requirements of their customers who make payments there, and the amount of that iund in the money center—in the central exchange market—fluctuates according to changes in rates reflecting changes in demand and supply, and according to the local needs of the bank. I do not see how it is going to be possible, by some mandate of law, to regulate that. In a way, it regulates itself. It is an inherent characteristic nf our type of banking in this country.” Dr. Adolph Miller (hearings on amended Stabilization bill, p. 120) stated: “It may be that there is such a considerable spread between the call rate in New York and the Federal Reserve discount rate, say, at an interior Reserve bank, as to put a temptation before the interior bank, if it has any money loaned on call in New York, to leave it here and meet the demands of its local customers by rediscounting with its Reserve bank. Such has undoubtedly been the case at times.” On the other hand, the testimony of Dr. Walter Stewart (Stabili- zation hearings, p. 765) stated: “The demand for credit for com- mercial purposes will always have first call on banking credits . . . For one reason, it involves the relation between the bank and the ‘ine-of-credit customers, and secondly, the loan usually yields a better rate of return than the ca#l loan . . . I think any well-managed sank, in addition to the loans to customers, would undertake to have some money in liquid loans—call loans, etc. I think in the last four or five years the growth of brokers’ loans has not been at the expense of credit available for commercial purposes . . . I think the use of credit in the securities market, in view of the general organization of credit and banking, is a legitimate use. “In considering bank credit it is seldom realized that of the $30,000,000,000 in member bank loans and investments, about half represents either loans on securities or investments direct. We are in the habit of thinking of our banks as a commercial bank system, but they have either loans on investments or investments to the extent of about half of their total resources.”

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