The Democratic banner. (Mt. Vernon, Ohio) 1898-192?, 1914-02-20
PLAN
To Aid Rural Finances Is
Proposed
By A Well Known Man Of
Omaha
Proposes Bank As A Clearing
House

Myers, president of the Omaha Real
Estate Exchange, is advocating a plan
to solve the rural credit problem, bas-
ed on the following convictions:
That the American farmer is not an
object of charity; that ne is not seek
ing money of charity; that he is not
seking money at lower rate than his
security and economic conditions JUS
tify; that any legislation, therefore,
which proposes to pledge the faith and
credit Of the whole nation in order to
raise funds to loan to the farmer or
any other class, would be "class Iegis-
lation" and would for that reason fail
In accomplishing It's purpose.
Mr.. Myers believes that If the gov
ernment will recognize the business of
the mortgage broker as now conduct
ed and will in addition provide cen
trail bank or bureau as a clearing
house for such mortgage brokers as
can qualify, and medium through
which the acceptable mortgages of the
country can be converted into bonds
of popular denominations for all class
es Of investors, large and small, the
whole object of rural credits as now
being considered by the administra-
ton will be attained.
The Myers plan, says the Nebrask-
an, has been submitted to Senator
Hitchcock at Washington. Mr.. Myers
proposes that Congress authorize the
establishment at Washington Of GEN.
trail national land bank or bureau of
the United States treasury with cap
ital of from $6,000,0O0 to 100000 900
to be appropriated temporarily by the
| government This bank or bureau
would be managed by board some
what similar TO the federal reserve
board, and Of which the secretary OF
the treasury and the secretary of agri
culture would constitute two mem
bers.
This bank would act as depository
and correspondent for district or sub
| ordinate national land banks to be 10
Gated throughout the agricultural dis
tricts of the United States. These dis
trict land banks would be privately
owned and controlled, but would op
crate under federal laws limiting thei
powers
These district banks would LOAF
their funds direct to farmers only up
on first mortgages and in amounts no
to exceed SO per cent OF the value o
the farm, when improved, and 40 pc
cent when unimproved. All loan
made by the district bank for the cen
trail bank would be made under regula
tions issued by the federal board upol
standard and, as nearly as state law
will permit, upon uniform blanks.
The notes and mortgages would ru
direct from the borrower to the dis
trict bank and be strictly negotiabl
In form.
All loans would be for the term o
10 years, with compulsory partial pay
ments of a certain percentage of tn
principal each year, The loans woul
contain also prepayment privilege
permitting the borrower, at his option
to make partial payments on any il
terest pay day in sums of 800.
The rate at which such mortgage
would be written would be fixed, fror
time to time, by the federal board an
would be the rate at which the ceI
trail bank would purchase at par an
accrued interest such mortgages o
would be accepted, discounted or pu
chased by it from the district bank.
Whenever the amount in mortgal
es thus purchased by the central ban
reached $5,OOO,OOO the federal boar
would set apart such amount in NOR
cages and issue against them an eQui
amount in United States land debel
ture bonds.
These bonds would be tax exemp
and legal investment for insuranc
companies, savings banks, trust con
panies, estates, etc.