Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1913-12-19
coMMlssIoN Dill 70 Dc TAKEN
UP ~ coNaRGss AFTER
CURRENCY pisPosAL
LOANS TO Dc DIVIDED
INTO TWO ossrlNcr CLASSES
Report eusesses Sserssa.
ton Of Notes and Providss That
sanks May ss co-opsraNvs-sharss
20 havs Market vajue and Borrow.
era viii d Prs<setsd.

Washington, Dec. 1s.-with the our.
rency bill about TO " enacted into law.
the president and congress will devote
themselves to the early creation Of .
system Of agricultural credit.
The FIRST stan. in this direction viii
be taken in q few days, when there viii
be submitted to both houses the report
of the national commission which In
vestigated the subject together with .
bill prepared by the commission which
has received the approval Of the presi-
dent.
According to the commissions re-
port. agricultural credit naturally d.
vides itself into two great classes
namely: long time or land mortgage
credits. which il defined a . credit to
meet the capital requirements Of the
farmer" and short time or personal
credit, which is defined az credit to
meet the current or annually recurring
needs of the farmer"
In the European system Of agricul-
tural banks the distinction between
these two classes Of credits IL sharply
drawn. In considering the question Of
whether the conditions in our country
demand a segregation Of institutions
designed to meet these two classes OF
credits. the commission attempted to
define in the first place the needs Of tho
American farming population In q
financial sense.
Farm Loans AU Described.
The farmers capital requirements
are described a. his need for large
sums Of money to be used In aiding
him to pay the purchase price of the
farm. Improvement Of the farm, such
as construction Of buildings, drainage.
irrigation. and clearing. or the equip
ment Of the farm 10 az to bring his
operations to the highest state OF ef-
dceincy.
The money needed for these pur-
poses must be in the shape Of a more
or less permanent investment, or in
the shape Of loans extending over such
long period Of time hat they can be
reduced gradually and paid off Of
the increased earnings derived from
the improvements.
The farmers temporary require
ments. by which Is meant the money
needed by him to fnance his oper-
atoms during the time the crops are
being produced. may call for short time
credit ranging from ninety days to one
year.
Credits Must 30 Segregated.
In the opinion Of the commission.
the report says, these two general
classes Of credits must be largely Sc.
gregated, altho the two systems viii
M f1lRoll u fns,NA ~ -no~,v ID Me-
ther. In the judgment Of the commits
'sion, the development Of a and mort
gage system Of banks - the most i'm
portant and he primary step to be
taken in order to improve our agricul-
tural. credit conditions.
In this country It is urgently neces.
sary. It u declared. to create a land
mortgage security which will be en-.
tirely liquid, which will run for a long
time. which can be paid of in small
annual or semi-annual installments,
and which will enable a man owning
farms to use most advantageously his
best banking asset-land-as the basis
of credit.
Personal Credit Up 10 State.
At first some Of the members Of the
commission were strongly imbued with
SAo AOCd SAA0I DOIu mortgage credit ana
personal credit should he dealt with
in any proposed legislation. But after
the recent widespread public discuss
sion Of the problems involved in the
pending federal reserve act, and after
a more careful and thorough investi-
cation Of the relation of the state and
national governments to the two ques-
tions under consideration. the COM
mission unanimously decided that per-
sonal credit could be and would be
more suitably met by state rather than
by federal action in those respects in
which the pending federal reserve act
failed to meet the requirements Of the
farmer.
The provisions Of tho commercial
banking system which will he estab-
lished by the federal reserve act will
benefit the farmer as well as the other
great Industrial classes OF the
try. According TO the commissions
report, while 1t would seem that many
of the requirements of the farmer
could o be provided for in a pure
system Of commercial banking. yet 1t