Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1914-09-01
Miserllantous Rraalr9.
McADoo'S COTTON PLAN
Committee Of Bankers, Manufacturers
and Planters Give il Approval.

and Planters Give it Approval.
Washington, August 2S.-Secretary
McAdoo's plan to accept as basi. for
currency, notes secured by warehouse
receipts for cotton, tobacco and naval
stores at IS per cent Of their face val
ue, was approved tonight in report by
the special committee appointed by the
conference of representative planters,
bankers, manufacturers and dealers
here August 24-25.
The committee recommended that
every effort be made to assist produc-
ers in holding their cotton for a price
that will minimize their losses until
the channels Of foreign trade are re-
opened. Eight cents pound was sug-
gested as a fair basis for loans on cot
ton.
The report, which was submitted to
Secretary McAdoo, follows:
Il. That the committee entirely ap-
proves of and congratulates you upon
the announcement made by you yes
terday afternoon that notes secured by
warehouse receipts for cotton and to-
bacco and naval stores, and having not
more than four months to run, will be
accepted as a basis for the issuance Of
currency to the members Of the ma
tional currency associations at rs per
cent of the face value of said notes.
80 That it Is the sense of the COM
mittee that cotton, tobacco and naval
stores should be marketed as deliber-
ately as possible until they can again
be exported in normal quantity and
that when properly conditioned should
be warehoused with responsible con-
Germs, that they should be protected
against weather damage and be prop
erly insured against loss or damage by
fire.
IS. That warehouse receipts for
these commodities are proper collat-
eral for loans by banks, and should
be so accepted with such limitations
as to margin, inspection and valuation
as conservative bankers may each in
their discretion see fit to impose.
a. That the average market value
of middling cotton for the past six
years has been in excess of IL cents
per pound that the committee is in
formed that the cost Of producing cot
ton averages, throughout the United
States, about 81 cents pound, that it
is rule Of economies that the pro-
duction of staple commodities will de-
crease If they continue unstable at
less than the cost Of production plus
a reasonable profit; that cotton does
not deteriorate when properly ware
housed, and Is as good twenty years
after it is picked as when it is first
gathered; that 1t can, therefore, be
carried over until the restoration Of
normal business conditions enables
the worlds consumption to absorb It..
The committee Is therefore Of the
opinion that every effort should be
made to assist the producers to hold
their cotton for price that will mini
mize their loss as far as possible until
such time as the channels Of foreign
trade shall be re-opened. That loans
upon cotton made upon a basis Of 8
cents per pound for middling, less such
margin as the lender shall consider
necessary, will afford reasonable pro-
lection to bankers and will really ia
cilitate the financing Of our most i'm
portant export crop in the present
emergency
rs. That in suggesting cents per
pound for middling cotton as a basis
for loans, it rs not the purpose Of the
committee to convey the idea that that
figure represents in their opinion the
intrinsic value Of cotton, but that II is
sufficient in their judgment to meet
the requirements Of the situation, and
enable the farmer to market his cotton
in an orderly and deliberate manner.
&c. That in case Of tobacco and
naval stores the committee is inform
ed that when these commodities are
properly conditioned, stored and in
sured they are practically non-perish-
able, and that the committee therefore
recommends that warehouse receipts
for tobacco and naval stores be accept
ed as security for loans on a basis
that has due reference to their market
value, less such allowance as the lead
ers shall consider reasonable in view
Of the present suspension Of the ex-
port demand.
~. Your committee recommends
that notes having not longer than four
months to run, when secured by prop
er warehouse receipts for the aforesaid
commodities, properly insured be ac-
cepted for rediscount by the Federal
reserve banks, when organized, and
that they also be approved by the ma
tional currency associations as securi-
ty for additional circulation to the ma
tional banks under the provisions Of
the Aldrich-Vreeland act, as amended
by the Federal reserve act.
IS. That a subcommittee be ap-
pointed by you for the purpose of con-
ferring with the treasury department
and the banking interests with a view
of carrying into effect the recommen-
dations herein made"
The report was signed by majority
Of the committee, including Royal A.
Ferris. S. T. Morgan, Lewis w. Pal .er,
r. G. Rhett. d. Y. Cooper, H. Walters,
Richard II. Edmonds, w. B. Thomp
son, ]. o. Thompson, William Elliott.
f. G. Ewing, B. l. Mallory, G. Gunby
Jordan and Theodore II. Price.