Week by week the total of brokers' loans mounted. Federal Reserve banks, led by Chicago, raised the rediscount rate to 5%.* Still the member banks reported that corporations and individuals were withdrawing deposits and putting their funds on the call loan market. Last week, U.S. bankers sat down to a serious campaign to end the wholesale diversion of money for speculative purposes.
In Chicago, Federal Reserve directors discussed radical action, a return to the early system of "differential rediscounting," with low rates for agricultural and industrial loans, high rates for loans destined for speculation. To Manhattan came curly-haired Roy Archibald...
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