The Reserve Act in Its Implicit Meaning

A GREAT banking system could conceivably grow up of itself in response to the demands of business. Such a system would be ideal because of its flexibility and freedom of adaptation to the changing requirements of commerce. But no such system ever did grow up or ever will. A business, involving such an element of trust, is necessarily conducted by human agencies and human agencies are uncertain and often dangerous. Government everywhere, in one way or another, is concerned with banking. It is concerned with the Federal Reserve System which has been evolved or built up around a statute known as the Federal Reserve Act, approved December 23, 1913. A statute, however, is only a first step toward a banking system which is finally made up of operating banks. These are credit and currency machines whose conduct, in accordance with the law, is guided, regulated and controlled by rules, precedents, traditions, habits, customs, decisions and what not. The mass of this material makes the

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