Money and banking

In addition, much rewriting in individual chapters has been aimed at greater clarity of exposi tion, better balance, and a more logical sequence of topics; and throughout. of course, author has sought to bring up to date all statistics, analyses of legal provisions and regulations, descriptions of institutional policies and prac tices, and other factual material.

Almost entirely rewritten are Chapter 17 on secondary reserves and the money market and Chapter 33 on problems and institutions in international financing. A rewriting Chapter 17 was demanded, one might say, by the recent very great expansion in activity in the money market and in its significance, therefore, for the whole economy, including the development within the space of a few years of negotiable certificates of deposit as a leading money market instrument; and a rewriting of Chapter 33 seemed to be necessary to take account of the big swing in our international balance-of payments position and its attendant difficulties, the new emphasis upon the relationship of this position to the broader problem of international liquidity. and the many "solutions" that have been offered for these interrelated prob lems, as well as to record changes in the roles of the International Monetary Fund and other international financing institutions.

Other chapters in which important new material has been added or materials of the fourth edition have been extensively recast include Chapter 5, in which the gold drain and the extraordinary shift in the silver situation are treated and a new analytical exposition of our present monetary system is presented; Chapter 9, in which the proposed re-evaluation of chain bank ing and the confused merger situation are examined; Chapter 10, in which the even more confused state of federal bank supervision and recent pro posals for reform are analyzed; Chapter 12, in which the new importance of certificates of deposit, open-market promissory notes, and long-term debt instruments as sources of funds for commercial banks is recognized; Chap ter 18, in which the reinterpretation of the investment powers of national banks and the resulting conflicts are treated; Chapter 21, in which the highly significant question of Federal Reserve "independence" is taken up and a recast analysis of the membership question is presented; Chapter 23, which presents a new treatment of the character and significance of our leading price indexes, including the implicit price deflators of gross national product; and Chapter 26, which has a new analysis of economic growth as a distinct goal of monetary and fiscal policy, together with additional material on em ployment and unemployment data. Chapter 29 takes into account the recent shifts in attitudes toward the efficacy of monetary and fiscal policy as well as the latter-day criticisms of Federal Reserve policy of most of the postwar period. In Chapter 30 much new material has been added on the nature of balance-of-payments surpluses and deficits, the problem of their measure ment, and their causes and possible remedies; in Chapter 35 new emphasis is given to the role of commercial banks in the area of consumer credit; and in Chapter 38, among other things, the material on savings and loan associa tions, their insurance system, and the operations of the federal home loan banks has been recast and expanded.