BANKING STANDARDS 
is true for the paired districts as a whole tends, generally, to be 
true of them individually. 
192 
3. SERIES CORRELATED WITH RATIOS OF TIME DEPOSITS 
Section 2 of this chapter was concerned with an analysis of 
the relations between the ratios in various series of bank data 
and demand deposits expressed, first, as percentages of earning 
assets, and second, as proportionate parts of total deposits. Sec- 
tion 3 pertains to the interrelation of certain of these series with 
time deposits, use being made not only of data for all member 
banks as a unit in each district, but also of groups of banks in 
the Boston district. 
(1) Ratios of Time Deposits to Earning Assets 
In Chapter IV, section 4, the norms and trends of ratios of 
time deposits to earning assets and to total deposits were de- 
veloped in detail. While there is no occasion for repeating even 
in summary what has already been said in this connection, the 
major conclusions are germane to the present discussion. Our 
purpose now is to determine the type and amount of correlation 
between different banking series and time deposits, by the use 
of methods similar to or identical with those already employed. 
The first approach to this problem is to classify into suitable 
groups the percentage differences, plus and minus, of the district 
ratios of time deposits to earning assets from their respective 
seven-year district levels, and for each group, as classified, to 
determine the net percentage deviations of other ratios from their 
district averages, the districts and years in all cases being paired. 
The results secured for three series of data, as given in Table 
116, indicate the following relations: (1) high and low ratios of 
gross and of net earnings are associated, respectively, with low 
and high ratios of time deposits—that is, the correlation is in- 
verse; (2) high ratios of total expense in terms of earning assets 
and of gross earnings are associated with high ratios of time 
deposits, and low ratios of total expense with low ratios of time 
deposits—that is, the correlation is direct; and (3) the larger 
the variations of time deposits from the district levels, the larger 
the variations, direct or inverse, in the other series, such relations 
being particularly systematic for ratios of total expense to gross