Regional President Speech

BANKING LOOKS AHEAD >t Karl K. fiopp before the National Association of Bank Auditors and Comptrollers, Philadelphia Chapter at the Fidelity-Philadelphia Trust Bu1 lding 6:30 P.M., February 13, 1945 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis B4MKIHG LOOKS Off the record Introduction 1. "But I got 100 In post-war planning" 2. Economist: Textbook wired for sound 3* Expert: Ignors minor inaccuracies as be sweeps to the major fallacy X* The position of banking A. Trend in Government financial operations (Billions) 1920 1930 1940 191A Expenditures..... 6.3 3*2 8.8 95*1 Revenues......... 6*6 3*9 5*2 43. 6 T~73 +“7? -3.6 -51.5 Debt (June 30)... 24.3 16.2 48.5 202.6 B. Trends in deposits, loans, investments, earnings (member banks) 1. Balance sheet items % increase June 30« 1944 from 1939 Deposits. 111,276 121 Oorenawnt («oar... 60,339 338 .......................... 33,084 37.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis - 2 - 2. Earnings 1940 1,323 1,830 Expenses..... 921 1,230 Net current earnings.• 402 600 Net profits.... 349 650 Net profits/ cap. acct*s 6.2 9.7 II. Ttypes of factors affecting banking A. Factors largely outside their control 1. Fiscal policy a. Government expenditures b. Government tax receipts c. Gross borrowing They can influence nonbank borrowing. Bidding down yield on 2*s after drives. Way to cut off nose to spite face. 2. Reserve position a. Currency in circulation b. Other factors 3. Regional shifts B. Factors over which they have considerable control 1. Quality of leadership they hire Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis - 3 - a. Why don't the best go into banking? You get what you pay f or. pJU *jv •/ Hu *u> y ^ ‘"‘C v * * b. Need for courage, Flexibility, and venture Beaten paths are for beaten men 2. The place of banking in the economy: alternatives a. Play it apparently "safe" - invest in Governments Low yield, but large volume and good "net" b. Venture capital HI. The Federal and the hnnir.Q A. Introduction We are in the field of money and credit together. Complementary, not competitive. We make no loans that anyone else will make. We serve the public interest. B. Analysis of background against which aredit is octeaded IdQf--.■ .' Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis - 4 - 1. The C. E. D. study a. Post-war labor market 900.000 seeking employment 825.000 jobs b. Financial requirements for con­ struction and renovation Coverage: 31% value of output 523/1422 Amount: Amount Per cent Expenditures: For new construction $36,716,000 37.5 For equipment...... 61.283.000 62.5 Total........... $97,999,000 100.0 Source of funds: Own funds......... $67,971,000 69.4 Borrowing from banks 26,447,000 27.0 Other sources...... 3.581.000 3.6 Total........... $97,999,000 100.0 2. Local studies 3. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis / J WARTBîE DEPOSIT SHIFTS Changes necessary' Gains in deposits to equalise rates Dec. 1939-No*. 194 4 of expansion Billions $ Per C^nt Billions $ Per Cent PHILADELPHIA RESERVE CITY BANKS.. .9 54.9 ♦ .9 ♦ 34.9 Large New York City banks...... 9.8 67.4 + 6.1 ♦ 24.8 PHILADELPHIA DISTRICT.......... 2.1 67.4 ♦ 1.3 + 24.8 Large Chicago city banks....... 2.6 77.2 + 1.1 ♦ 17.9 PHILADELPHIA COUNTRY BANKS...... 1.3 80.3 ♦ .4 ♦ 15.9 2.5 89.7 + .5 + 10.1 3.4 108.1 H .0 + 0.4 All member banks.......... 53.6 109.0 — mm 4.4 U3.e ' .2 - 2.2 2.2 127.0 • .3 - 7,9 1.5 130a ■ .2 - 9.2 Richmond district.............. 2.7 138.7 .6 - 12.5 Kansas City district;........... 2.7 146.3 .7 - 15.2 San Francisco district......... e.o 164.9 ' 2.7 - 21.1 2.6 166.5 .9 - 21.6 2.8 166.9 1.0 - 21.7 Other Chicago district......... 6.3 175.3 2.4 - 24.1 Prepared by the Department of Research and Statistics Federal Reserve Bank of Philadelphia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Karl R. Bopp (1945, February 12). Regional President Speech. Speeches, Federal Reserve. https://whenthefedspeaks.com/doc/regional_speeche_19450213_karl_r_bopp

@misc{wtfs_regional_speeche_19450213_karl_r_bopp,
  author = {Karl R. Bopp},
  title = {Regional President Speech},
  year = {1945},
  month = {Feb},
  howpublished = {Speeches, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/regional_speeche_19450213_karl_r_bopp},
  note = {Retrieved via When the Fed Speaks corpus}
}