Macon beacon. [volume] (Macon, Miss.) 1859-1995, 1914-12-18

the committees. IL must NC AC
lien and protected By Insurance.
against damage,
instructions to Bankers
The banker must be prepared tP
contribute to the loan fund one-fourh
OF the amount that his customers borS
row. He makes his subscriptions as
the loans are made, sending forward
New York drafts for rs per cent OF
each loan; in return, the banker res
ceives a certificate of participation Of
the denomination issued to the cot
ton states subscribers, designated as
"Class B." The $4,000 900 subscrfb-
ed by the city banks, being three
fourths of the entire fund, is desig.
mated in GLASS A" certificates in pro-
portion to the subscriptions OF the
city banks. When the loans are paid,
the Glass A banks receive two per cent
in dividends to each M per cent paid
Glass B banks until the balance due
Glass A and Glass B banks is equal,
then the dividends are equally divided.
For instance, II a bank was only jn-
terested In one loan Of $4,000 its In
terest in the pool would be a $3.50
certificate Glass B; the Glass A pro-
portion would be $2,250. When Class
A had received 80 per cent of its sub
scriptions in dividends, and Class b
one-half, or 40 per CEN of it's subscr1p-
ton, the division between the "A" and
"B" class in that loan would be $3.50
each; future dividends would retire
this equally.
The Glass A certificates are prefer
red only to the extent that any losses
to the cotton fund in the end would
be payable out Of the guarantee fund
first to Class A and second to Class
B. AS the losses should be slight UNI
der the careful administration that is
being perfected, this preference
should be of little moment II a fair
amount Of the fund Is used.
The bank is not required to endorse
the loans of its customers, but must
guarantee the prompt and ~punctuaI
payment by the borrower of interest
on loans, and all warehouse charges
and insurance premiums. AS the
forms to be furnished will be COM
plete, the transaction should be short
and simple.
The Farmers object.
President H. s. Mobley Of the
Farmers Union of Arkansas said the
farmers were very much disappointed
In the details of the cotton loan plan
He said:
"The farmers asked Congress to-
have the treasury deposit United
States treasury funds in the banks
to be loaned to the producers of cot
ton at $50 per bale, at 6 per cent in
terest. We made a strong fight for
this, but the Wade plan was intruded
into the fight, proposing that the
bankers would subscribe $135, 900, 900
to a pool to be loaned on cotton on
the terms we had asked government
loans. This defeated out efforts.
Since Congress adjourned we have
waited patiently for the bankers plan
10 be put in operation. 1t is now an
hounced That the governing committee
is ready for business. They propose
to lend on not less than one hundred
bale lots.
I'VE had expected to be able to bor-
row on single bales or more, when
properly insured and stored. But
their proposal to lend on not less than
one hundred bale lots disappoints III
in this regard. AS the matter stands.
the average producer is prohibited
from borrowing, and will receive no
benefit whatever. The cotton buyer
and large grower can be taken care
CT. but the multitude of small grow
ers are entirely eliminated. Can any
one wonder at the discomfort and
prejudice of the small farmer when
matters which are proposed as being
for his benefit turn out as this does.
to be actually for the benefit of 9TH
ers?
1T is such proceedings as this that
cultivates and keeps alive the labor
ing mans antipathy to business men.
especially bankers"