This diagram demonstrates that the Canadian bank notes adapt themselves every year, every month, every day, with unvarying precision, to the ever changing demands of trade.
Total circulation of the chartered banks of Canada for each month of 1912 to Nov. 30th.
| January | $88,065,521 |
| February | 88,920,598 |
| March | 95,918,404 |
| April | 95,145,371 |
| May | 93,819,333 |
| June | 102,011,848 |
| July | 95,827,534 |
| August | 101,501,270 |
| September | 104,334,287 |
| October | 110,696,877 |
| November | 115,473,098 |
| Maximum issue | 115,473,098 |
| Minimum issue | 88,065,521 |
| ————— | |
| Amount of Expansion | $27,407,577 |
| Population of Canada | 7,204,838 |
| Per Capita Expansion | $3.80 |
| Same expansion in the United States would amount to | $380,000,000 |
Under present conditions we do not have any note expansion whatever. Not one single dollar. Every "Fall" we have a tragedy, because we are compelled to use our reserve money to meet the increased demands for currency.
The above figures correspond in their expansion and contraction with the figures for many years previous, with one significant change in the date of maximum circulation, which has changed with the later farm demands due to the tremendous development in the great north-western territory. No stronger proof could be added to the marvelous way in which this bank credit currency automatically adjusts itself to any and every condition as it arises.
This currency goes to the Clearing House every day, precisely as the checks and drafts do, for redemption. And in those cities where there are no Clearing Houses, the banks present the notes they take in, to each other, and the notes are redeemed every day by the respective banks issuing them.
Mr. Merchant: Gentlemen, isn't it marvelous how that currency adapts itself to the demands of the Canadian crop moving period? Why, if we had such a system working here, you would have an increase of currency every Fall exactly equal to our demands, probably $300,000,000. I have heard the amount variously estimated from $200,000,000 to $300,000,000. At all events, this principle would give us exactly the amount needed to meet the demands of trade.
Mr. Banker: That is precisely what would happen, and there would be no shipping currency to and fro, backward and forward from New York to Chicago and St. Louis, and then from these cities to a thousand other points; and then when the crops had been moved the currency must be shipped from the thousand points to St. Louis and Chicago and then on again to New York. The banks in every locality would create their own currency according to their respective needs, and at a cost of about one-fifth of what it costs them today.