The times. [volume] (Richmond, Va.) 1890-1903, 1892-06-09

Another View of the Cnse-Undcsira"'"'J"'
Land ~ Security.
Editor Times.

Editor Times: -. a.
Iagre. with your editorial OF tho 7th that
probibtion of State banks issuing currency
il unjust. but | do not agree Win you 'na'
this unjust prohibition is the reason why y ,n de
Id IN Alabama could not borrow siO,VOO
on / 600 acres Of as fine bottom land as there
is in the United States. ana why tne
owners could not borrow slZ'VVV Oh 4ua Uni
Ter OF million dollars worth OK superb Olue
Grass grazing land Of Wythe county"
Money may be as plenty as leaves that
s,reu the brooks ia NallambrOsa. but lend
ers will not lend unless they believe that Dor,
Tovers Will pay interest and principal
nromptly AZ maturity. or that their evidences
of debt can be promptly foreclosed WITHOUT
cost TO themselves. III, IL.
Now agricultural loans are specially unde.
sirable because OF difficulty on these two yitai
points. and il was solely because Of this ana
not because of absence OF local banks OF issue
that the loans could not be made.
First: Interest is desired at least semI-au-
nually. but as planter and farmer as rule
have only one money crop be can under most
circumstances pay only once instead OF twice
"A year but even then payment Is uncertain.
Second: When note OF mortgage defaults
security cannot be promptly toreclosed. be-
cause iniunctions will certainly DO granted,
and il may be years and at great cost before
the creditor can get his money. Lenders have
been taught such severe lessons in Nirginia'
and matters are still worse. ! believe. IN the
South. They much prefer TO lend TO busl-
ness men without capital but OF good reputa-
ton for promptness TO lending either TO OWE
ers o. finest bottom Lane" OF most superb
bluegrass grazing land
Agricultural borrowers. alas for themselves,
have thought 10 make their beds easy by
making foreclosures difficult. They have
only succeeded ia getting beds OF Stats and
because they are hard they think 10 ind re-
lief in free coinage or local banks OF issue.
Any such bank leaning On agricultural secur-
ity would find itself bankrupted IN short
space. The problem of cheap agricultural
borrowing under present law Is akin 70 squar-
ing the circle or - impossible. Inc DrSt
step willy be TO make foreclosure easy,
and then they may probably borrow without
banks of local issue.
But granting Il local bank Of issue as sup
{, posed and granting the 1000 loaned ana
notes issued. let Us trace these local notes a
little. They must, OF course be representa-
tive of money good away from home. or 10
convertible readily into greenbacks. national
currency or gold ana silver Undoubtedly
| since perhaps most OF these Sl2,OOJ notes are
70 be used away from home.
At these points. not possessing the same
/ currency as notes secured by Federal pledge,
they will soon be excluded from the circu-
lsting medium and will he presented for re-
I demption. and the bank. to meet this certain
contingency, must always have at hand 70.
/ demptlon fund almost equal to the amount Of
/ its issues. What advantage local currency
| will possess under such circumstances IS din
cult 10 see. and the notes circulated ut home
will soon fnd themselves at distant points 10
/ pay local indebtedness, and the same tate VIII
/ soon meet them IA the others tney Will De
sent home speedily for redemption. 10 be OF
/ any service a local currency must te OF equal
value to the best. and as this is the case a
/ bank of local issue must ct tho same tine be
standard bank; in other words, be no bank
/ of local issue ut all.