Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1915-08-24
r6irty Million Dollars of Gov
eminent Funds to Be Avail
able for RedisCounting Out
standing Debts,
M INTEREST CHARGE
ON MONEY ADVANCED
Secretary Of Treasury Exer-
cIses Discretion Given Him
by Law for Relief of South
Elm Planters,

.,opAfNe JOURNAL SPECIAL LEASED wiREl
Wasbinetou. Aug. 2S.-Treasury
oierals tonight made public an am
,orpcement nv secretary McAdOo
NM h view of the action of the al
has In putting corton on the contra
band ligt he would, if it became ne
ssss5ry deposit $30.0OO,000 or more
h eol8 m the federal reserve banks
n Atlanta. Dallas and Richmond. for
M plrpose Of enabling the reserve
banks % rcdiscomt loans on cotton
secured 10y warehouse receipts made
nv national banks and state banks be-
longing 10 lhe federal reserve system
the sold would be deposited tenn
porarly at least. without interest
charge I. was explained that if it
appeared that the object could be ac-
e0mplshed with greater efficiency
thereby. the deposits would be made
directly with national banks agreeing
10 lend the money on cotton at a rate
10 exceed per cent
TO Uphold Market
Secretary McAdOo authorized the
announcement from his summer home
at New Haven. Me It came at the
close of q dan of speculation i'm Off
cal circles as To the nature of steps
which the entente powers have lndi-
Gated they will take to uphold the
cotton market in the face of their con-
traband order.
IN the exercise Of the discretion
given 10 him bv law" read the treas
ury statement, Secretary McAdoo
said that the government will for the
time being charge no Interest ON these
deposits In federal reserve banks, that
such action is justified by the unusual
situation respecting cotton caused by
The European war; that he consid-
ers ii his duty 10 use every available
means IN his power 20 help tne cotton
producer of the south in the clrcum-
stanees that Il Is a matter of economic
Importance to the entire nation that
those who have produced the cotton
crop shall have a fair opportunity TO
dispose of it gradually and in an or
dorly manner so they may not be
forced, through inability to market
their cotton gradually TO sell it at
sacrifice prices
Want, Enlarged Credit,
The secretary SAID that one of his
chief objects was to create a basis for
such enlarged credit i'm the south that
the banks will have ample resources
TO extend 10 producers such accommo-
datons that they Will be able to carry
cotton In warehouses for a reasonable
length of time until it can be market
ed adyantageously. In order to ace
comphsh this, he said that the na-
tonal and state hanbs which are
members of The federal reserve sys-
tenn should make loans on warehouse
feeelnts for insured cotton at low rates
of interest, that the banks can we'll
afford tO carry cotton for producers
al per cent especially if they are
able TO rediscount cotton paper at the
FEDERAL reserve banks at "a much lower
rate than per cent; that the credit
resources Of the banks OF the country
arc greater than ever before in our
history, and that there is no reason
why the banks should not. i'm cooper
auon with tine merchants of the south
nelp the cotton producers with loans
1t loW rates in the present peculiar
situation
The federal reserve board, the sec
lelafy said had "a right 10 determine
lhe rate of interest which the federal
reserve banks can charge member
DdAks ON notes or loans secured by
insured and warehoused cotton redis-
counted with federal reserve banks.