Show BANKS PLAN EASY MONEY LOAN SYSTEM Resources of Federal Reserve System to Aid Economic Recovery C nv v NEW YORK Jan 14 millions o of dollars now stored in bank vaults soon w will be pushed into circulation to promote economic recovery under under under un un- der a new easy casy money policy undertaken undertaken undertaken un un- un- un by the federal reserve tern tem This will be done by throwing the i almost lim limitless credit resources oi ot I the federal reserve system behind the security markets in an effort to prevent what reserve say is an unwarranted de deflation lation of stock and bond values By exerting pressure on member banks the federal reserve authorities will have member banks borrow more heavily buy large amounts of bankers bankers bank ers era acceptances and United States government bonds as investments thereby setting loose an equal amount o ot of money nELA CREDIT Bankers denied that this move represented represented rep rep- resented the embarkation of the reserve reserve reserve re re- re- re serve system on an inflation policy policy pol pol- icy as some som charge They described It as relaxation of credit not needed by banks and badly required by busi busi- ness Immediate superficial effects of the reserves reserve's new policy was seen in the stock and bond markets yesterday where prices rose to their best levels since early December United States government go bonds were especially strong on bank purchases recovering all the ground they lost earlier in the week on foreign debt repudiation fears If the reserve program Is carried out as its sponsors hope bankers believe believe be believe be- be lieve con confidence will be generated in inthe inthe th the security markets and millions of dollars will flow back into legitimate business purposes Failure of that money to return to the market has retarded retarded retarded re re- re- re bus business ness recovery HUGE RESERVES A measure of the aid lid that conceivably conceivably conceivably ably might be extended by the federal fed eral reserve banks was indicated in a recent statement b by y Governor George GeorgeI I L. L Harrison of the New v York bank Harrison pointed out that reserve banks throughout the country had more than of eligible assets and that the federal reserve banks were in a position at the present present present pres pres- ent time and on the basis of their present gold supply to expand federal federal federal fed fed- eral reserve credit to their members by some which could mathematically form the base for fot an increase of as much as in bank credit |