Reserve fund

“ In any fiscal year in which the General Reserve Fund does not maintain the required percentage of general fund revenue, monies from the Capital Reserve Fund first must be used, to the extent necessary, to fully replenish the General Reserve Fund. ”

“ The funds in the general obligation debt sinking fund and the guaranteed revenue debt common reserve fund shall be as fully invested as is practicable, consistent with the requirements to make current principal and interest payments. Any such investments shall be restricted to obligations constituting direct and general obligations of the United States government or obligations unconditionally guaranteed as to the payment of principal and interest by the United States government, maturing no longer than 12 months from date of purchase. ”

“ The less these conditions are developed, the more difficult it becomes, not only to lay out the money received to-day productively to-morrow, but the more imperatively does a proper foresight demand, that a reserve-fund should be maintained for times of necessity. (See § 43.) 750 Even in the same age and among the same people, money moves most slowly under the influences of troublesome and critical epochs ”

“ The Bank Reserve Fund is available for the liabilities of the bank, while the Redemption Fund may be utilized for repayment of any money advanced to the Australian Treasury or in the redemption of stock issued by the bank, but there is a proviso to the effect that if the fund exceed the amount of debentures or stock in existence, the excess may be used for the purpose of the redemption of any Commonwealth or State debts taken over by the Commonwealth. ”

“ Surplus income is to be transferred to the reserve fund and that fund is to be used to meet deficiencies. If it is insufficient for that purpose, the trustees are required to notify the treasurer and receiver general of the commonwealth, and the commonwealth is to pay the amount of the deficit ascertained according to the act. ”

“ Where the revenue is 5,000 francs, they can accumulate a sum only equal to three times their annual expense, and for others the reserve fund should not be in excess of over six times the annual outlay. ”

“ As the only fund provided in this scheme are small monthly payments which are constantly being divided in the shape of monthly realizations, there is no possibility of a reserve fund for the security of the co-operators. The uncertainty of the amount realized upon these settlements is evident from the fact that while a member may possibly realize as high as $15 for every dollar invested by him, he may realize no profit at all ”

“ The people had prospered and taxes were paid in full and without complaint. The reserve fund grew steadily and surely and there was every prospect that when the huge debt came due it would be paid in cash. ”

“ Of course if the Public Works Loan Commissioners lent a larger proportion of building capital than they do now, they would be justified in charging interest at a somewhat higher rate, the difference between the new and the present rate going to a national reserve fund, out of which possible losses might be paid. ”

“ In opposition to what might be at first sight supposed, the best way for the bank or banks who have the custody of the bank reserve to deal with a drain arising from internal discredit, is to lend freely. The first instinct of every one is the contrary. There being a large demand on a fund which you want to preserve, the most obvious way to preserve it is to hoard it—to get in as much as you can, and to let nothing go out which you can help. ”

“ A bank like the Bank of England must always, therefore, be on the watch for a rise, if I may so express it, in the apprehension minimum; it must provide an adequate fund not only to allay the misgivings of to-day, but also to allay what may be the still greater misgivings of to-morrow. And the only practical mode of obtaining this object is—to keep the actual reserve always in advance of the minimum 'apprehension' reserve. ”

“ It might be possible to enforce by law the accumulation of such a reserve fund, and then the distribution of a fixed percentage of the net profits of the business to labor-instead of permitting all the profits to go into the pockets of owners or stockholders. ”

“ This sum, together with government subsidies and other sources of income, will yield, we are told, a gross income of 438,000l.: a sum which it is estimated will not only pay working expenses and a handsome dividend to both old and new shareholders, but will yield a balance for a reserve fund, more than sufficient to lay a second cable in every two and-a-half years. ”

“ A maximum of returns in the shape of profits or dividends will be fixed by law. The community itself will undertake the furnishing of credits, loans and necessary capital for the establishing of a new business, charging a small rate of interest and maintaining a reserve fund to meet these operations. Private banking, insurance and the loaning of money on collateral will cease to exist. ”

“ It is true that if the periodic amounts of the estimate for depreciation and the sinking fund are practically the same, and if provision is made only for the sinking fund reserve, there will be in that reserve a sufficient amount to care for the depreciation. Assuming the life of the asset and the life of the bonds to be the same, such a policy means simply that the asset, usually a fixed asset, has been converted by use into current funds which have been applied to the liquidation of the bonds. ”

“ At this time a company might be formed in France, Germany, &c. who would form a stock of one hundred thousand pounds sterling, to defray the expense of this settlement. By such a step, you, in the first place, extend the circle of your connexion and influence. You increase the number of your inhabitants, proportionably lessen the common expenses and have in the reserve a fund for public exigencies. ”

“ That when the United States Government shall have made provision for refunding the 2 per centum bonds or consols into 3 per centum bonds and the American Reserve Bank Fund shall amount to the sum of five hundred million dollars, the United States Treasury shall transfer to and keep with the American Reserve Bank a sufficient balance—upward of fifty million dollars—to meet all of its checks and drafts ”

“ They combined their earning power, pooled their earnings of ‘hard’ currencies, and entrusted them to the Exchange Equalisation Fund, which held them as the reserve of the entire sterling area and issued to each member the sums that it required to satisfy its own economic needs. ”

“ Most of it was owed at home, but millions of people had patriotically invested their own savings and reserve funds and the capital essential to their business enterprises. Governments had to meet the interest charges, and, because they needed to borrow still more money, their people had to be assured that all that had been advanced would be paid back. ”

“ Cash-surrender value is the reserve less a surrender charge. And in case of a single-premium policy the reserve is the face amount of the contract discounted at a specified rate of interest on the basis of the insured's expected life. ”

“ But if the reserve banks do not feel the pressure of excessive issues in the shape of accumulations of notes or some form of money in their own vaults, they may conceivably be able to invest advantageously all the funds in their possession, and, in that case, the rate of interest charged by the Federal Reserve Board will not furnish an adequate motive for the retirement of their issues. ”

“ The earnings of the reserve association are limited in percentage tit a reasonable and fixed amount, and the profits over and above this are to be turned into the Government Treasury. It is quite probable that still greater security against control by money centers may be worked into the plan. ”

“ When, in the early times of public credit, the repayment of the capital was the chief object of the lender, a much more extensive fund was necessary than at present, when no more is required than the payment of the interest. As such funds never can be formed but from taxes, or general contributions from the people, the greater they are, the larger must the contribution be. ”

“ The Department of the Treasury is also acting to restore confidence in a key element of America's financial system by offering Government insurance for money market mutual funds. For every dollar you have invested in an insured fund, you'll be able to take a dollar out. ”

“ The public thus saves over seven million dollars of annual interest, and secures a safe and convenient medium of exchange, and has the assurance that a sufficient reserve in coin will be retained in the treasury beyond the temptation of diminution, such as always attends reserves held by banks. ”

“ It enables us to look to the future with confidence and to make plans far ahead, based on the belief that the Federal reserve system will exercise a steadying influence on credit conditions and thereby prevent tiny sudden or severe reactions from the period of prosperity which we are now enjoying. ”

“ Indeed, if clearing houses should be established, thus forcing redemption, it is a question for your consideration whether banking should not be made free, retaining all the safeguards now required to secure bill holders. In any modification of the present laws regulating national banks, as a further step toward preparing for resumption of specie payments, I invite your attention to a consideration of the propriety of exacting from them the retention as a part of their reserve either the whole or a part of the gold interest accruing upon the bonds pledged as security for their issue. ”

“ The bill passed both houses without a division. The highest expectations were founded upon it, for people generally, in common with Pitt himself and Price, regarded the new fund as an infallible means of discharging the national debt solely by the uninterrupted operation of compound interest. That the application of surplus revenue to the payment of debt is sound finance, and that to treat surpluses designed for that purpose as a separate fund is a convenient arrangement need no demonstration. ”

“ No one fears the loss of the funds which may be subscribed to the capital stock of the federal reserve banks or placed on deposit with them. If loss should be incurred, it would be primarily due to unsound banking on the part of the boards of directors of the Reserve Banks, a majority of the membership of which is to be chosen by the banks themselves. ”

“ We should not collect revenue for the purpose of anticipating our bonds beyond the requirements of the sinking fund, but any unappropriated surplus in the Treasury should be so used, as there is no other lawful way of returning the money to circulation, and the profit realized by the Government offers a substantial advantage. ”

“ The purchase and sale of government bonds and notes and state and local short-term obligations require no detailed consideration. In periods of inactive demand for rediscounts, investments of this kind will doubtless be made by the Reserve Banks in order to employ surplus funds.
The right to engage in foreign exchange dealings will also be similarly useful, surplus funds being invested in foreign bills. ”

“ If you say that the Bank shall always hold one-third of its liabilities as a reserve, you say in fact that this one-third shall always be useless, for out of it the Bank cannot make advances, cannot give extra help, cannot do what we have seen the holders of the ultimate reserve ought to do and must do. There is no help for us in the American system ”

“ As and when it may be necessary the Bank should raise or lower its rate, maintaining a reserve which is sufficient at all times if it be about one-third of the liabilities. To speculate upon the future, is to attempt to discount influences which may never be felt. To maintain for a day a higher rate than is necessary, is to tax the public for private ends, to reinstate Protection, and to disregard sound economic principles. To illustrate what we mean, take the case of bread famines. ”

“ When the Federal Reserve steps in as a lender of last resort, which it's had to do repeatedly since this financial crisis began, it's providing an insurance policy underwritten by the American taxpayer. ”

“ It is an awfully nice thing to have, but adds never a cent to my solvency. My correspondent points out that it costs policy holders in old line companies more to maintain the legal reserve than it does to provide for losses by death, and adds that this is proven by the fact that all such companies doing business in the State of New York must have on hand in cash, or in invested assets approved by the insurance department, the reserve belonging to all the policies which they have in force. ”