New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-08-10
NATIONAL BANK SYSTEM
FOR FARMERS AC|1ATED
Senator Fletcher Would Let
Agricu|turists Borrow on
Land from Public.
FEDERAL BUREAU AS WELL
Amendments Covering Bankers
Requests for Less Reserve
May Be Embodied in Ad-
ministration Measure.

Washington, Aug "a national rurai
banking system was proposed in a Dill TO-
dav by Senator Fletcher. chairman OF the
American Commission on Rural Creoi'''
and also of the Federal Commission Oh
Rural Credits, appointed by the Fresi-
dent.
The bill proposes a system Of local ma
tional rural banks. owned and operateu
by farmers; a state national rural oank III
aach state TO be owned and controlled
nv the local banks as stockholders, anu
tho National Rural Bank OF the Unitcu
ctotos IN be located in Washington, 10
he owned entirely by the state rufai
banks.
To supervise the proposed chain Oh
hanks there would be created III '"e
Treasury Department a division OF rurai
banking under the direction or ru'"'
banking board" to consist OF the oe''e
"a ries Of the Treasury, Agriculture anu
Labor The division would be under l"e
,r,nediate direction of a director VI
ruroI banking" chosen by the Presldeh'.
The main purpose OF the banks WIZ
be TO furnish funds TO farmers OF ion9
term farm bonds or notes secufeu
liens on farms at not exceeulhb :" -.
con, ~ their assessed value. Loans "ou'u
ba secured first by a local bank. then py
o s.ate hank. and last By the Nallohai
Rural Bank of the United states anu
thew would run from twenty TO hltS
v.srs The National Rural Bank IS oe
signed 70 have capital and surplus eA-
,,shI tho stock oil edfU
local bank would be limited 70 S-'V''V'''
Senator Fletcher, speaking on the Hoo'
to-day 10 urge immediate oonsiuefa'io''
~ tho measure by the Banking Commit
too and its passage at the special ses-
.,on Of Congress. expressed approval OF
the administration currency Dill as
commercial banking bill, but said IL WouIu
NOT meet the needs OF the agricultural
communities because OF the necessity ZOE
long term loans
Loans from Twenty to Fifty Years.
1T is obvious" said Senator Fletcher
that the only method OF furnishing caP-
tai for the requirements OF the farmer Is
the creation OF a long term first mortgage
bond secured on his land, which bona
shall contain a sinking fund provision
so that an amount shall be set aside each
wear 10 pay of the bond when 1t natures
The farmers loans should run from
twenty TO fifty years,
no bank can loan money for sucn
length OF time. The money must be Dor-
rowed from the investing public. Here Is
where a special system OF banks IS
needed which will be authorized 70 use
their credit in guaranteeing such bonds
under restrictions which Will reduce tho
risk Of such guarantees 10 a minimum
The proposed federal reserve system
the Senator said. did not offer such relief
but the provisions OF his own measure
he maintained. though not perfect, would
meet the requirements.
Amendments TO the reserve sections OF
the administration currency BILL which
many bankers say are vital To the con-
tlnuance Of present credit conditions un-
der the proposed new currency system
have been tentatively Endorsed by Chair
man owen OF the Senate Banking Com
mittee. and may be Incorporated in the
hill before II passes either house.