The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1914-10-25
RESERVE BOARD
APPROVES LOAN
FUNDF0RCOTT0N.
Pool of $135, 100000 Will Be
Raised to Care for
Surplus Crop.
MN SCHEME OUTLINED
By SECRETARY M'AD0O
New York Bankers to Subscribe
$50,0oo,oo0 and Southcrners Are
Counted On for $35, 5,ooo,OOo.
oUTGRowTH OF WADE pLAN
Early Responses Hoped For, So That
Proposal VIII Be Put Into
Immediate Execution.

WASHINGTON, October 24.--After
negotiations between Federal reserve
. members and bankers. tentative
agreement was reached tonight. when
the board Virtually approved plan
by which a fund of $135.0oO.0O0 will
be raised to care for the surplus cot.
ton crop and extend aid to cotton pro
ducers. The plan is slightly different
from that originally proposed, but
loans will be made on cotton at cents
pound. bearing interest OF not more
than per cent for one year. with a
privilege Of six months extension.
Tho reserve board will have direct
charge of the fund. but will probably
operate through committee OF bank
ers. All the details OF the plan were
= not made public tonight. New York
bankers have agreed to subscribe $780,
100000 to the fund, and Southern banks
are counted on for s35.000.000 more.
The remainder of s50.o00.oo0 Is to be
raised In noncotton- producing States.
PLAN Is OUTLINED
8 ny SECRETARY McADoo
Secretary McAdoo outlined the plan
tonight In the following statement:
Tho Federal Reserve Board to-day
continued consideration OF plans for re-
lief o. the cotton situation, giving spe-
s ciai attention to a plan Buggested by
Albert II. Virgins J. S. Alexander. A. J.
Hemphlll and William Woodward. Of
Nsw York, and Fcstus J. Wade, OF st
Louis, for the raiHing OF cotton loan
fund aggregating s135.000.00o. This
plan has been evolved from that origin
al1y proposed by Mr.. Wade. Full details
cannot be given out until 1t is sub
rt,itted to bankers IN leading financial
centres TO ASCERTAIN whether or not
they will support 1T. 1t has been ap-
proved tentatively by the Federal Re-.
serve Board, and bankers in the lead
ri xytI he g1SA "A q I,,-
naaiately to aubscffBS gazss n de ssary
: amount. New York City bankers have
agreed TO subscribe s50.000.000 upon
condition. that an additional s50.o00.000
shall be subscribed by cities In ncncot-
tcn-producing States. The remaining
s3b.00o.00o Is to be provided by the,
cotton States.
PROVIDES LOAN
AT O CENTS POUND
The new plan contemplates tho
leaning of money on cotton at cents
pound. and at an interest rate not
exceeding e per cent for a period of
, one year. with the privilege OF re-
newai for an additional period of six
months. 1t Is provided that all SER
Vices rendered In the administration
OF the fund by voluntary committees
and bankers shall be without charge.
but that the borrowers shall pay 8
per cent on the amount loaned to them
E iHto u IuHu, WHICH Is TO De CalleQ Ine
guarantee fund. and which Is to be
used exclusively for paying the neces-
sary expenses OF administration, which,
It Is estimated. will not exceed 1-S of
i per cent, and the remainder to be
used 10 make good my losses which
may De incurred on loans that may
be made on cotton at the stipulated
rate OF 6 cents per pound. Upon the
sconcluaiofi OF the whole transaction
! the amount Of money left in the guar
antee fund will be returned pro rata
to the borrowers.
..It Is hoped that responses may be
received from the bankers OF the lead :
ing cities early next week. II favor
able, the plan will be put into immcd-
late execution. In that case the cotton
loan fund Will be administered under
the general supervision OF central
committee of the individual members
of the Federal Reserve Board, which
committee will. in turn, appoint COM
. mittee to be known as the cotton loan
committee and which will have active
actual management of the fund.
"The plan In its new form is more
practical than anything heretofore
presented and 1t is hoped tho requisite
amount may be promptly subscribed,
that the plan may be put into immed-
late -operation.n