Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1903-09-03
MONEY TO MOVE CROPS
Annual Call Upon Wall Street
For Settlement.
THE TREASURY TO THE RESCUE.

When Western banks Demand Mon
cy They Have Loaned to New York
Banks Money VIII BE Tight, and
Other Interests Besides Wall Street.
Some western newspapers are much
exercised about where the money is to
come from ito move the crops" They
fear in view of the panicky condition
of the stock market that the New York
banks will have all they can do TO take
care of their Wall street customers
One would think, to hear these Repub-
that the New York bankers and Wall
street furnished every dollar to pay for
each bale of cotton, each bushel of
wheat and what corn the farmers dis
posed of. Not u dollar of their own
money necessary to move the crops is
furnished from that source. The money
which is paid to the farmers for their
crops comes from the western banks
and is the deposits of the farmers and
the business men of the west
During the spring and summer
months the surplus of the western
banks is kept on deposit with their cor
respondents in New York and the other
money centers, and they receive the
going interest on their daily balances.
The New York banks loan this western
money to the Wall street operators on
call or short time on Stock Exchange
securities. When the crop moving time
comes the western banks begin to with
draw their balances from New York to
supply the local demand of the crop
buyers. That brings about the annual
old chestnut Of Wall street furnishing
the money 20 move the crops In fact,
the western banks are only calling for
their own money. not dollar of which
the Wall street banks can refuse.
In ordinary years this money move
ment makes the rate of interest In
New York advance in the fall as an in
ducement to people who have unem-
ployed funds to loan IT on stock secur-
tiles and replace the western money,
and in Il few months the flow of funds
is again to the financial centers through
the ordinary channels OF trade-tbe
farmer selling his grain and paying his
bills to the retail merchant. who pays
the wholesaler and the latter the manu-
facturer. When speculation Is ram
pant, as It has been this year. the de-
mand for money is greater and the re-
call Of the money in the west makes 1t
more difficult for the banks to finance
the Wall street demand. When Octo-
Der arrives it may therefore be expect
ed that money VIII be dear in New
York and the spectators will have TO
pay high rates There is more than
enough money to supply all the de
mands of business. but not enough to
furnish the millions tied zap in loans on
stock collateral in Wall street.
In former times the southern and
western banks were borrowers of extra
funds in New York to reloan to their
customers who were buyers of cotton,
wheat and other cereals, but that time
has gone never to return except TO a
very small extent, and then only If the
New York banks have more money on
hand than they can use to advantage
in loans in their own locality. So when
the pinch comes and the cry goes up
that the New York banks must have
money to move the crops" and the
secretary of the treasury is called upon
to aid them the cry is really for money
to move the Wall street crop of undi-
gested securities that the trust pro-
moters have been so assiduously cul-
tivating In the stress last fall every
dollar that could by any Interpretation
of the law be diverted from the United
States treasury was loaned or deposit
ed with the New York banks, which
they have never repaid. The whole
power of the administration has been
used to aid the stock gamblers, and the
promise is made that more and even
illegal aid viii be extended to them.
The present trouble in Wall street Is
because the New York banks are pre-
pairing for the repayment of the west
ern money they have been using and
are adjusting their loans to meet the
emergency that they know will later
encompass them. The financial mag
mates of Wall street see that the United
States treasury has about exhausted
all its resources to replenish the dwln-
ding reserves of the Wall street bank
ers. and the overloaded spectators
view with apprehension the shrinkage
III Na1ue oI lne papeT IOrluneS lhey
possess.
The Republican idea that the govern
ment must aid Wall street and that the
financial affairs of the United States
must be run according to the dictatiOn
Of the big bankers is meeting it's own
reward Unfortunately thousands Of
honest folk will be ruined and the bust
ness of the country disrupted by the
partnership of the financial and trust
magnates with the Republican admin
iFtrafion.