America's Money Machine

The Bill Considered 77
22, the conference report was accepted by both House and Senate, and
on the 23rd the bill was signed by President Wilson and the Federal
Reserve Act came into effect.
The public acceptance, between relief and enthusiasm, of the resolution
ofthe currency question was reflected in the full page advertisement
in the Times run by the United Cigar Co., at the time one of the leading
retail store chains of the country and one of the larger users ofcredit for
expansion. The advertisement was headlined: THE NEW CURRENCY LAW
A FORERUNNER OF BEITER TIMES.
Probably the best summary ofcurrent opinion was that offered by Paul
M. Warburg in an interview given the following day:
There cannot be any doubt that the enactment of this legislation will
inaugurate a new era in the history of banking in the United States. While
it is to be regretted that some important suggestions made by the business
community could not be adopted, the fundamental thoughts, for the victory
of which some of us have worked for so many years, have won out. That is
to say, from now on we shall witness the gradual elimination of the bondsecured
currency, of scattered reserves, of immobilized commercial paper,
and of pyramiding of call loans on the Stock Exchange. The ship is headed
right, and nothing will ever turn her back into her old course....10