The Caldwell watchman. (Columbia, La.) 1885-1946, 1914-12-18

the COmm1ttee. IL NuSt NC t|o AAoAAA
lien and protected by insurance
against damage.
Instructions to Bankers.
The banker must be prepared to
contribute to the loan fund one-tourtn
of the amount that his customers Dor
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 re-
ceives a certificate Of participation OF
the denomination issued to the cot
ton states subscribers, designated as
"Class B." The $1OO,000,O00 subscrib'
ed by the city banks, being three
fourths of the entire fund, is des1g-
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 one 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, il bank was only in
terested in one loan of $4,000 its in
terest in the pool would be $3.50
certificate Class B; the Glass A pro-
portion would be S2,25O. When Class
A had received 80 per cent of It's sub.
scriptions in dividends. and Class B
one-half, or 40 per cent Of its subscTip'
| ton, the division between the "A" and
"B" class in that loan would be $3.50
each: future dividends would retire
this equally.
The Class 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 Glass A and second to Class
b. AS the losses should be slight un-
der the careful administration that Is
being perfected, this preference
should be of little moment if 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 punctual
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 strong fight for
this, hut the Wade plan was intruded
into the fight, proposing that the
bankers would subscribe $4,000, 900
TO pool to be loaned on cotton on
the terms we had asked government
loans. This defeated out efforts.
|since Congress adjsnIrnnsa ,--yes-s.saas
INDEPENDENTLY FOR the bankers plan
to be put in operation. It is now an
nounced 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 Dor
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 us
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, hut 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"