Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1899-11-16
Regulating Cattle Paper.

tons before the bankers and the cat
tlemen is the handling Of cattle paper.
Mr.. 0. P. Benton OF Osborne read an
excellent paper on the question at the
State Bankers meeting. In his re-
marks, after discussing the commits
sion company's position, he said:
1.-The cash proceeds for sale Of the
cattle on which our loans are based
many times pass through their hands,
making them temporarily the Gus
todian Of these funds, amounting
some days to thousands Of dollars in
money in which the bankers Of Kan
sas are directly and indirectly inter-
ested. By shrewd manipulation Of
these funds deposited to the credit Of
the commission houses nice balances
are maintained, although checks may
have been drawn and sent to the
shipper; but before they are presented
for payment new ,onsignments have
been received, sales made, more cash
obtained and the good account replen.
ished. Thus the money belonging to
the shippers and feeders ofstock, who
are also large customers ofour banks,
both as depositors and borrowers,
largely aids the commission houses
in obtaining re-discounts at minimum
rates.
with this cheap money at their
command solicitors are scattered over
the State offering loans to our GUS
toners at unusually low rates, many
times waving all profit in interest
depending upon their commission for
selling the cattle when they 60 to
market for their compensation. In
this way they offer our customers
money at rate Of interest when nec'
essary to do it to get business, as low
as the banks Of Kansas can obtain it.
Thus the business Of the banks is i'm.
paired, borrowers themselves made
disconnected by the frequent offers Of
the solicitors, while the rivalry be-
tween the various commission houses
becomes SO marked that unreasonably
large loans are negotiated. Men be-
come borrowers OF thousands where
hundreds would be far more prudent.
$50 long as money is plenty, cattle
paper popular and the commission
houses can readily obtain credit, it is
quite likely all will run smoothly;
but with many thousand dollars of
endorsed paper, should confidence be-
come fully shaken, the once popular
cattle loans rapidly being presented
for payment, and no new demand
from investors for more loans, is there
no danger of their handsome bank ac-
counts being quickly exhausted and is
it not fact that the proceeds of our
customers cattle might be placed in
jeopardy Perhaps you have loan
upon these cattle depending entirely
upon the prompt returns for your
pay.
''After all is it not fact that the
bankers of Kansas are deeply inter-
ested in the continued success of the
commission houses and have we not
a right to know how much capital is
invested by each firm handling cattle
at the market tOWnsp
"Ex.college professors, beardless
boys and in some instances a job lot
Of broken down men who know little
about the loaning Of money are sent
out as solicitors for business offering
ten thousand dollars at six per cent
interest to some man whose request
for a loan Of $40 on a chattel mort
gage might cause the local banker to
hesitate. The same paper bearing
the official endorsement OF the COM
mission house is sold to some invest
or and pronounced gilt edge cattle
paper, standing side by side with the
paper that is placed by the local
banker based upon his years Of ex.
perience, bis personal acquaintance
with the borrower and collateral offer
ed and his knowledge Of the country
and conditions. Should reverses
come the bankers OF Kansas will SUI
fer with the commission men, for all
cattle paper, good and bad, will be
condemned"
Mr.. Benton urges that the commits
sion firms make regular statements Of
condition and be regulated by the
banking department Of the State.
Both are sensible propositions and
n l..