Federal reserve notes so issued there must be a gold reserve of not less than 40 per cent.

During the months of August, September, and October, 1916, the volume of Federal reserve notes outstanding increased over $65,000,000, and on October 31 the total amount in circulation was $238,496,920 of which $223,523,070 were secured by the deposit with the Federal reserve agent of a like amount of gold and lawful money and only $14,973,850 by commercial paper.

Up to October 31, 1916, Federal reserve notes to the amount of $897,020,000 were printed, $419,200,000 of which were shipped to Federal reserve agents and United States subtreasuries, and $477,820,000 held in the reserve vault available for shipment as required. The average life of national currency has been computed to be about 2 years, but notes begin to be returned for destruction as unfit in about six months after issue. At the end of the year, or up to October 31, Federal reserve notes to the amount of $81,734,430 had been returned for destruction as "unfit for circulation.

Detailed information relative to issues and redemptions of Federal reserve notes, by banks and denominations, is given in the following tables:

Statement of Federal reserve notes, by denominations, printed, shipped to Federal reserve agents, and United States subtreasuries, and on hand in reserve vault, Oct. 31, 1916.

Statement of Federal reserve notes, by denominations, printed, shipped to Federal reserve agents, and United States subtreasuries, and on hand in reserve vault, Oct. 31, 1916Continued.

Federal reserve notes issued, by denominations, through the Federal reserve agents to the banks, also the amounts retired and outstanding Oct. 31, 1916.

Federal reserve notes issued, by denominations, through the Federal reserve agents to the banks, also the amounts retired and outstanding, Oct. 31, 1916-—Continued.

Mutilated Federal reserve notes, by denominations, received for destruction, destroyed, and on hand in vault Oct. 31, 1916.

FEDERAL RESERVE BANK CURRENCY.

In addition to Federal reserve notes, the Federal reserve banks may also issue what has been designated as "Federal reserve bank currency." This currency is of the same tenor and effect and is

issued under the same terms and conditions as national-bank notes, except that its volume is not limited to the amount of capital stock of the issuing bank.

The notes issued to the banks are secured by deposits of Government bonds bearing the circulation privilege, acquired in the open market or taken over from national banks desiring to reduce their circulation.

Federal reserve bank currency, by denominations, printed, issued, and on hand in vault Oct. 31, 1916.

Federal reserve bank currency, by denominations, printed, issued, and on hand in vault Oct. 31, 1916-Continued.

LEGISLATION BY THE PRESENT CONGRESS.

During the present Congress the Federal laws relating to banks, banking and the currency, have been materially amended and important new legislation affecting banks written into the statute books. In addition to the amendments to the Federal reserve and national bank act, changes have been made in the laws relating to the income tax on banks; issuance of certificates against gold bullion and foreign gold coin, and the act of October 15, 1914, supplementing the laws against unlawful restraints and monopolies in relation to interlocking directorates.

Under date of July 17, 1916, the act was approved "to provide capital for agricultural development, to create standard forms of investment based upon farm mortgage, to equalize rates of interest upon farm loans, to furnish a market for United States bonds, to create Government depositaries and financial agents for the United States and for other purposes." There was also approved under date of August 29, 1916, the act "relating to bills of lading in interstate and foreign commerce."

The Federal reserve act approved December 23, 1913, was amended on September 7, 1916, as follows (changes and additions to the law in italics):

AMENDMENTS TO FEDERAL RESERVE ACT.

At the end of section eleven insert a new clause as follows:

"(m) Upon the affirmative vote of not less than five of its members the Federal Reserve Board shall have power, from time to time, by general ruling, covering all districts alike, to permit member banks to carry in the Federal reserve banks of their respective districts any portion of their reserves now required by section nineteen of this Act to be held in their own vaults.'

That section thirteen be, and is hereby, amended to read as follows:

"Any Federal reserve bank may receive from any of its member banks, and from the United States, deposits of current funds in lawful money, national-bank notes, Federal reserve notes, or checks, and drafts, payable upon presentation, and also, for collection, maturing bills; or solely for purposes of exchange or of collection, may receive from other Federal reserve banks deposits of current funds in lawful money, nationalbank notes, or checks upon other Federal reserve banks, and checks and drafts, payable upon presentation within its district, and maturing bills payable within its district. "Upon the indorsement of any of its member banks, which shall be deemed a waiver of demand, notice and protest by such bank as to its own indorsement exclusively, any Federal reserve bank may discount notes, drafts, and bills of exchange arising out of actual commercial transactions; that is, notes, drafts, and bills of exchange issued or drawn for agricultural, industrial, or commercial purposes, or the proceeds of which have been used, or are to be used, for such purposes, the Federal Reserve Board to