MR. BANKER: That's what they are. They started by copying the Massachusetts Bank Act, as it existed before the war, and have gone on making some changes from time to time since. The banks are authorized to issue regularly an amount of currency equal to their capital. The amount of capital has not been increased in proportion to their business, because there are only a few banks there now, 27 in all, with about 2,000 branches. Here is a chart I had prepared to show you, because it illustrates so perfectly how the currency expands and contracts every Fall. You see that in the month of October every year they have an increase of about $3.80 per capita over the minimum amount, and that just as soon as the crops are disposed of, the currency again takes the form of a deposit. [Illustration: 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.