Word: panic
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Dates: during 1920-1920
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...time in the business cycle when a panic would have occurred, if we were to have one, has passed, according to this letter, which is the latest of a series issued to the subscribers of the Review of Economic Statistics. The movement of rates on commercial paper and of speculation indicates that the liquidation in commodity markets will end some time between December, 1920, and April, 1921. The action of the Federal Reserve Banks in increasing rates and restricting credit practically insured a business readjustment unaccompanied by a financial panic. For "higher interest rates do not spell disaster, but safety...
...worst of the little tempest in Boston's financial teapot is over. With the assumption by the state of the seventh bank in months to close its doors, and the announcement by three more of a moratorium delaying withdrawals of savings deposits for ninety days, the course of unthinking panic seems to have been allayed. The gradual return to sanity will now offer an opportunity for grave reflection...
...panic, with its evil effects even upon healthy institutions, its detriment to local manufactures and trade, and its reflections upon the financial reputation of Massachusetts, will have been worth all the trouble, if out of it can come a realization that sound, progressive banking methods, administered by trained executives, are preferable to high returns and low security...
...fortunate that there are officials in this country who can tell a harmless radical from a bomb-thrower, who refuse to be swept into panic by the sight of a soap-box or a red banner. It is fortunate, too, that some of our courts have not forgotten that an alien, like anyone else, has his rights before the law--that he is to be judged innocent until he is proved guilty...
These resulting circumstances are due to the operation of the Federal Reserve Act. By virtue of this act, banks are permitted to make loans practically to the extent that their customers can furnish adequate security. There is no danger of panic by unusual demands on the part of depositors, because the banks can rediscount the notes they hold by taking these to the Federal Reserve Banks of their respective districts. Using these rediscounted notes as collateral, in addition to forty per cent in gold, the Federal Reserve Board may place in circulation new currency, known as Federal Reserve Notes, which...