The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1913-01-29
TOO MUCH CREDIT
Former State Treasurer OF Penn
sylvania Says Panic Is
Threatened.
NE RECOMMENDS SOLUTION
Farmers Union Delegation
Wants System of Incorpor-
ated Clearing Houses.

Washington. January @.-Ihe issue
of paper legal tenders. based on gov
eminent, State and munieipal oohos
and backed by gold reserve OF at ieas'
20 per cent, was recommended as
solution OF the currency problem by
". II Berry. former State Treasurer
of Pennsylvania. on the stand to-day
before the Currency Committee OF the
House.
Mr.. Berry told the committee that
the evil of the present system was an
insufficient supply of legal tender re-
serve TO support the extended credit
demanded by business interests of the
country.
The banking laws are responsible
for the accumulation OF money in the
reserve cities he said. The law al
lowing the accumulation OF millions
Of money in these reserve cities IL
responsible. A lack OF cash in reserve
restricts the banks in the credit they
can allow. and this inevitably results
in a discrimination as 10 borrowers
SO long as this situation obtains, there
VIII be money trust"
A chart produced by Mr.. Berry pur-
ported 10 show that panics followed an
expansion of credit 20 point where
IL was beyond the support of the avail
able cash reserves.
That lie the situation now" he con
.inued. The credits granted have
been extended 70 point where me
reserves are but So per cent on the out
standing obligations OF the banks
Unless these reserves are extended IN
som way. a panic inevitably viii FOL
low That So per cent was about
the breaking point OF 1907. and panic
is now threatened. We have TOO much
credit for the cash in hand and TOO 1T
tie credit for the needs OF the coun-
try"
Berry's Suggestions.
Ny. Berry proposed making the
bank note circulation legal tender, and
forcing banks 20 surrender oonus upon
which they issued these notes Under
examination by the committee he SAID
ne believed that gold reserve OF az
least % per cent of the current legal
tender would support the issue
Mr.. Berry declared himself opposes
20 the Ald<ch-currency plan. insisted
that the present currency system is re-
exchange gambling" and the unem-
ployment that follows restricted IN
dustrial activity
G. s Barrett, Of Union City, Ga.
president OF the National Farmers
Union. an organization with branches
in twenty one States, and 3,ocoe mem
bers. appeared heading delegation
including A. &. Davis, Rogers. Ark ,
Peter Radford. Fort Worth, Tex (;
President Texas State Union. r L.
J. Barnett Pacudah. Ky. secretary treas
urer Kentucky State Union; A r.
Swift. Baker Ore, Oregon State
Union. and Prof. T. J. Brooks, profess
sor of markets and economics. Mississip-
nj state Agricultural and Mechanical
College.
Professor Brooks. spokesman for
the farmers union delegation, said the
farmers objected to the present none
tarv system. because. he said. II led TO
concentration and undue speculations
He suggested a system of Incorporated
clearing houses.
Farmers need long term loans, Prof
Brooks said in order that they may
become owners instead of tenants To
meet this need. he proposed that postal
savings banks deposits be made avail
able for loans on farms lands, and
outlined a system OF land banks to be
operated entirely separate from com
rnercial banks