The Jeffersonian. [volume] (Atlanta, Ga.) 1907-1917, 1914-10-01
BY j. I'D. WATSON

giving direct benefit to the Southern farmer,
tnere seems more hope for us in Secretary
McAdoo's ultlmatum to the National bankers
than IN anything else now proposed.
In statement issued last Wednesday, Mr..
McAdoo tells the bankers
Il have decided not to deposit the second in
stallment of crop moving funds with your bank
at this time. You can, however, if you desire
Withdraw one-half Of the securities deposited by
you and use them security for the issue Of ad-
dltlonal currency if you make application there
for.
I am informed that many banks in your State
are refusing to make any loans for crop moving
purposes, and that in many good loans
rejected or unreasonable rates Of interest are
asked. | am also informed that many banks
which have taken out additional currency are re-
tuslng to use it in spite Of great demands for
money. shall withdraw all Government deposits
from banks charging excessive rates of interest
or which refuse reasonable accommodations and
Snall refuse to issue emergency currency to banks
which are not making of it on reasonable
terms for the benefit Of the business community"
The reports of the national banks being
received by the Comptroller of the Currency indi-
cate jan extraordinary boarding Of money by
many Of the national banks in various sections of
the country. [ am astonished that so many of
the national banks are pursuing a course con-
trary to the public interest and so indefensible
from any point of view There is neither occa-
sion nor necessity for it,
advantage OF the new currency law have Dor
rowed immense sums of money from the gov
eminent for the purpose of lending to the
farmers Of the South, when as matter of
TACT they are boarding. it and not lending to
the farmers at ALL or they are charging such
an eXorbltant rate Of interest that the far
mer cannot afford to borrow, but must sacri-
flee his cotton instead.
Again we quote from a telegram sent by
Mr.. McAdoo to the clearing house associa-
tons of New York. Chicago Boston and St.
Louis, in which he says;
ct have received complaints about the high
rates Of interest which are being charged by the
national banks Of Mex York, Boston, Chicago and
other reserve cities. 1t is alleged that the New
York banks requiring their correspondent
banks throughout the country to pay 7 per cent
for loans and to maintain balance with the New
York banks, which makes the money cost the cor
respondent banks the equivalent Of per cent or
more
Charges Not Justified
"From all the evidence before me, cannot feel
that the charge of Z to per cent interest by the
New York banks is justified in the circumstances
Within the past six weeks have approved the is
suance to the national banks of New York city of
more than $40 900 of new or additional
bank currency This was done for the purpose of
easing rates and helping the situation generally.
I have taken the position with all of the banks
of the country that will not knowingly issue adj
dlClOnal naClOnal Ddnk currency TO or deposit
eminent funds with banks which charge excessive
rates of interest, which are refusing to meet
legitimate demands for reasonable credits
81 am using every just effort to persuade the
banks throughout the country tc extend reasona-
bic credits and at reasonable rates Of interest to
meet the existing unusual conditions created by
the European war, and which, if dealt with in
helpful spirit by all concerned should quickly
ameliorate. 1 should like to the New York
banks take the lead in establishing and main
tanning moderate rates of interest for accommo-
dat thpir a has 1orO in
fuence upon banking action and sentiment in the
country