Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1906-10-09
CROPS AND MONEY RATEs.

committee appointed last March by
the New York Chamber of Commerce
the question of more elastic curren-
cy is taken up. In the foremost part
of the report the harvesting and the
moving Of the crops" is taken up. On
this subject the report says
.We find, however, that the none
tary system is defective in one most
important respect-namely, fiexibility
and that in consequence the coun-
try's business interests are at times
seriously hampered This defect is
due to restrictions which are unneces-
sarily placed by law upon the bank
credit. Nearly fifty per cent of the
people Of the United States are engag-
ed in agricultural pursuits and the
fruits of their toll are harvested in the
autumn These harvests and market
ing of the crop bring to bear upon the
banks two-fold strain, one for capital
the other for currency.
The demand for capital comes
from the buyers and shippers Of agri-
cultural products and is in the main
satisfied by an expansion of bank
loans and deposits. most of the pay.
ments being made by check and draft.
The demand for currency comes prin.
cipally from the farmers and planters,
who must pay their help in cash. In
the satisfaction of these demands the
banks are unable to make use OF
their credit. but are obliged to take
lawful money from their reserves and
send 1t into the harvest fields. AS a
result the money reserves of banks
are reduced at the very time when
the demand for loans is increasing,
and in consequence the rate of inter.
est is advanced
| Undoubtedly the bankers know
their own troubles. But there is just
a little inclination in the west to the
belief that New York has come to
| consider itself great portion Of the
United States and to thirls that every.
body ought to come to the relief OF
its SPECTATORS. Everyone is not com
petent to speak or write on this sub
ject, SO perhaps it is best to let a
western banker have something to
say in the matter In fact, he has al
ready said it,. and said it in New York
In an address before the New York
State Bankers association last sum
mer. F. J. Wade, president of st
Louis trust company, dealt with the
question, What causes fluctuation ir
money rates. the agricultural crop OF
the Wall street crop?" He came to
the conclusion that most of the fluctu
alton in question was from the de
mand of the Wall street farmers. He
refers to that section of New York as
4 follows:
\ G M mn ol,,o III 1a,, IA
in the world, and produces a crop end
less and most incalculable in amount
and can create more impressions as
to the frequent and wide fluctuations
of the money market than all the
land of ell the states and territories OF
the United States combined"
AS to the money for the removal OF
crops, he said that the west, south
and north had about 30 per cent more
deposits in 1905 than all the eastern
and New England states had in 1896
The increased power and freigh,
equipment of railroads to move the
crop to the seaboard, and convert the
crop into cash through the medium Of
foreign exchange, he said, had aug
mented the banks ability to effect 8
quick turn of the crop to cash al
fully 100 per cent, and that the facili
ties for thus turning the crops had
increased over 100 per cent in the last
six years.
"The deduction draw from the
above he said, lis that if you gentle
men from the east take care Of the
wall street crop, the west, southwest
north. and northwesn will be fully
capable of taking care of the agricul
/ tural CROP
All western bankers may not agree
with the st. Louis man, but there is
evidently some basis for his conclu
sion.