The Madison journal. (Tallulah, Madison Parish, La.) 1888-current, 1913-08-09
MONEY Y
TO AID FARMERS.
FROM s25,coo 600 TO s5oooo,0oo TO
BE DEPOSITED IN BANKS
OF COUNTRY.
ANTICIPATES A STRINGENCY
Bond and Commercial Paper to ee
Taken as Security-Loans Must
Be Returned in Short Time.

Weston Newspaper Union l!ews Ssrvice
Washington.-From s25,00O.0O0 to
SJO.O00,000 of government fund.- will
be deposited in the national banks or
the south and west at once by Secre-
tary McAdoo to faciliatate the move
ment of crops. Federal, state and mu-
nicipal bonds and prime commercial
PAPER will be accepted as security for
the money, upon which the banks will
ray two per cent interest.
The motive of Secretary McAdoo in
establishing this new policy is to an
ticipate the money stringency in the
late summer and fall, which invariably
accompanies the marketing and move
Dient of crops, especially when the
crops are unusually large. as the har-
vest now beginning forecasts. he in
tends to take time by the forelock and
prevent or minsnize the usual tight
ness of moEey.
In a statement the secretary made
the significant answer that govern
rent bonds would be accepted al pas
as security for new deposits, and that
the additional money would be placed
only with banks which have taken out
at least 40 per cent of their authorized
circulation.
United States two per cent bonds,
serving as security for most Of the
national bank circulation, have been
depressed recently to new low market
records, dropping to 95 "a during the
past few days. The secretary's willing
ness to accept these bonds at par as
security for the SOS, 100000 to s5O.O00.-
900 of promised deposits. and the in
dIsement to the nationaI banks 10 in
crease their circulation up to the 40
per cent lislit, is expected to help in
restoring the parity of the depressed
twos by creating new market for
them.
For the first time in history the gov
eminent will accept prime commercial
paper as security for deposits. This
privilege will be granted, announced
the secretary. In order to make these
special deposits available to the banks
on securities readily within their
reach.
"The commercial raper submitted"
added Mr.. MsAdoo. shall first be pass
ed upon and approved by the clearing
house committees of the cities in
which the banks offering such paper
may be located. All commercial pa
per and bonds must finally be passed
upon and accepted by the secretary"
Approved commercial paper will be
accepted as security for the deposits
at 65 per cent of its face value, aud
high class state, municipal and other
bonds, at IS per cent OF their market
value.
The additional deposits will be plac-
ed with the national banks in the two
or three principal cities in each OF the
states where harvesting now is in
progress and where the demand for
money for moving the crops most con-
veinently can be met. The secretary
said 1t would not be practicable to
scatter the deposits among the smaller
cities, especially in view OF the char
acter of securities necessary.
The bands will be required to return
the money to the public treasury when
the crops have been moved.
The present suggestion is, Mr.. Nc
Adoo said, that Is per cent be paid in
December, 30 per cent in January, 30
per cent in February and 25 per cent
in March next.