EXHIBIT S. Acceptances executed for customers, as shown by reports of condition of national banks for Reserve cities. Nov. 20, 1917. Total central reserve cities.. Boston..... 86, 930, 691. 64 6, 149, 757. 11 575,000.00 5,531,263. 26 6,595, 121. 08 6,595, 121. 08 38,869, 332.75 38,869, 332.75 98,611, 712. 01 Nashville. 183,333.00 Southern States.. Cincinnati. Cleveland. Columbus. Indianapolis. St. Paul. Cedar Rapids. Dubuque.. Sioux City Kansas City, Mo. 692, 633.00 1,731, 542.00 100,000.00 800,000.00 6,080.00 300,000.00 718, 539.00 200,000.00 295,398.00 120,050.00 2,440, 350.00 4,000.00 1,881, 386.00 150,000.00 59,729.54 303, 383.00 6,627,717.54 992, 031.00 3,738, 075.00 100,000.00 800,000.00 300, 979.00 449,000.00 1,400, 789.00 200,000.00 St. Joseph... 50,000.00 Acceptances executed for customers, as shown by reports of condition of national banks for Nov. 20, 1917-Continued. Acceptances executed for customers, as shown by reports of condition of national banks for Nov. 20, 1917-Continued. EXHIBIT T. The following is a copy of a letter which the Comptroller of the Cur rency addressed to the Interstate Commerce Commission, showing the importance of granting to the railroads an increase in freight rates, because of the heavier expenses which they are being called on to meet owing to the advances in wages and in the cost of materials used in operation: TREASURY DEPARTMENT, OFFICE OF COMPTROLLER OF THE CURRENCY, To the Honorable Washington, D. C. GENTLEMEN: The official reports made to this office by the national banks of the United States show that these banks are the holders of about $500,000,000 of railroad bonds, largely of high character, selected with care and discrimination during a period of years. In addition to these large holdings the State banks, savings banks, and trust companies hold approximately $1,500,000,000 additional of railroad securities. These investments the banks purchased in the belief that they would maintain the prices at which they were purchased, or grow more valuable from year to year, with the growth and development of the country's business and of the corporations issuing them. A crisis, however, has arisen. The net earnings of many of our most important railroad systems, as well as of the less important lines, despite the greater volume of business, show a shrinkage which not only imperils dividends, but is threatening the ability of many railroads to meet their interest charges and their solvency. There has been a serious collapse in the market values of railway securities and such a demoralization of credit that the sale of new securities to provide fresh capital or to meet maturing bonds has been shut off, and even temporary financing is now only being obtained at rates which are costly if not ruinous. The impairment of confidence and consequent shrinkage in securities owned by the national banks had become so pronounced that on October 15, 1917, as Comptroller of the Currency, I gave to the press a statement which said, in part: In view of all conditions, the Comptroller of the Currency has instructed nationalbank examiners that they need not at this time require national banks holding highgrade bonds of unquestioned intrinsic value and merit to charge such investments down to present abnormal figures; but an intelligent and conservative discretion will be exercised as to the prices at which national banks can safely and reasonably be permitted to carry such high-class securities, and as to what proportion of the depreciation should be charged off in any six months' period. In giving out that statement I did so in the confident belief that the credit and welfare of the railroads of this country would be safeguarded and protected and that they would be permitted to charge such rates for the transportation of freight and passengers as would, with honest and efficient management, enable them to meet their expenses and yield a fair return upon the billions of dollars of capital which has been invested in them, and I am, of course, still confident that this will be done. This office has received so many earnest requests asking the Comptroller of the Currency, in behalf of the national banks of the country, to make to your honorable commission representations as to the serious consequences which may ensue if relief is not promptly afforded the railroads in the shape of increased rates, to enable the roads to meet the unprecedented increases in the cost of materials and labor and yet maintain their credit, that I ask the liberty of submitting to you this memorandum and brief summing up of the situation as I see it at this time, in the light of an experience of about 20 years as a railway executive (as well as banker) before retiring entirely from these activities and divesting myself of all financial interest in railroads and in banks, as I did, to accept public office more than four years ago. As an illustration of the communications which have come to me as Comptroller of the Currency from banks which are under the supervision of this office, I beg leave to quote the following extract received under date of October 29, 1917, from the president of the First National Bank of who says in part: Why does not the Comptroller appear before the Interstate Commerce Commission and make an appeal for the banks of which he is supposed to be the guardian and protector? With millions of our funds invested in railroad securities, it would seem this would be his duty. * * * With the farmers granted over double prices, the coal, steel, and copper double and more, the railroads are certainly entitled to a paltry 15 per cent. With this apology, I trust that I may be pardoned for respectfully submitting to your honorable commission this communication, based, as above stated, upon my own knowledge and observation of past and present conditions. From the close of the Civil War up to the beginning of the present century the principal media for investment of the surplus earnings of the American people, in the way of public securities of any kind, were the bonds and shares of our railroad corporations. The railroad mileage of the country grew from 52,922 miles in 1870 to 192,940 miles in 1900, an increase of nearly fourfold. This new construction was paid for partly from the savings of our own people and partly from capital sent in from Europe. Confidence in railway securities as investments was rudely shaken between 1892 and 1897, during which years 213 railways having an aggregate mileage of 56,402 miles failed and passed into the hands of receivers. The total railway mileage of the country in 1892 was 171,563 miles in 1897, 183,284 miles, so that the companies which became bankrupt in those five years represented nearly one-third of the entire railway mileage of the country. This is exclusive of many thousands of miles which had already become insolvent before 1892 and were in receivers' hands at the beginning of that five-year period. The records show that the persistent and steady decline in railroad freight rates which had been going on through several decades culminated in 1898-99, but this shrinkage did not cease until the solvency of over one-half of the entire railroad mileage of the country, which had been built up to that time, had been destroyed. The average rate, which in 1888 was 10.01 mills per ton per mile, declined in 1890 to 9.41 mills. By 1895 it had fallen to 9.39 mills, and |