Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1915-09-25
Ottumwa Bankers Explain
Transaction Regarding
Allies Big Credit
MAY AID A LITTLE
IN. MOVING CROPS
Otherwise the Deal Is Not
Of Any Importance From
Banking Standpoint


loan that England and France are aeak.
Ing to arrange in the United States.
The Courier today asked local bankers
to express themselves upon the aubiect
especially with reference to the nos.
sible or probable effects of the loan m
on the middle western section. ofwhie,
Iowa is the center. The question a.
whether or not it was right for this
country to lend money to one OF tha
warning factions was not gone into:
the interviewer merely sought to se-
cure expressions as to the effect the
loan VIII have on this part Of the coun-
try.
From the bankers 1t was learned that
the loan could more properly be called
an extension of credit. England and
France DO not propose to take half
billion American dollars out of this
country. They seek to establish here
credit as large as possible against
which to draw In paying for foodstuffs
and non on-contraband articles that are
bought here.
In effect the transaction is this: the
governments of England and France
are buying from American producers
and paying cash obtained at American
banks on the notes Of the two foreign
countries. The bankers in general be.
,lieve that the notes should be accom-.
panied by some collateral preferably in
the shape OF some of the four or five
billions dollars worth OF stocks and
bonds now held in Europe. This how.
ever the foreign financiers have refils
ed to do and the loan aG planned is to
be made on the strength OF the notes
which will be in effect first mortgages
against England and France.
West Not Participating.
Regarding the effect locally of the
loan, John G. Jordan, president of the
Iowa National bank stated that in his
opinion the proposed loan does not an. i
peal to the bankers of the west and
middle west and accordingly he does
not believe the loan will have anv an.
preciable effect upon the banking sit
uation In this section. 1T is not like.
ly,' he said, "that the middle west will
feel any effects insofar as the banking
situation is concerned, of the loaning
Of so large sum Of money to England
and France. If it is true, as New York
says, that the money will be used
wholly in the purchase of foodstufrs
and necessities other than munitions OF
war, then the loaning of the money
will be felt in easing the movements
of the crops"
Secs Benefit For West
L. A. Andrew, president of the Citi-
zens' Savings bank said:
1T seems to me that the central west
will derive some benefit from the credit
loan which is being arranged by the
allies In this country. 1t Is not pro-
posed that any money shall be sent
out of the country but that the credit
be used for the purchase of food stuffs
and merchandise other than munitions
of war. This will provide very much
needed market for our surplus grain
and give the farmers Of this part of the
country a better price for what they
have to sell.
II do not want to appear In the light
of favoring any loan. but simply speak
Of the possible benefit that may result
to the central west. do not care to
express an opinion as to whether the
loan is good one or not or whether
1t should be made or not believe In
trying to be entirely neutral.
VI COuISo, We maven UccA d5hcu W
take any part of the loan and would
not do so in any event, as we have
plenty of use for our money at home"
viii Aid In Moving Crops.
Frank Mc1ntire, president of the
South Ottumwa Savings bank said: II
the money that is loaned to the allies
is used for buying foodstuffs, then 1t
will aid in preventing scarcity OF
money at crop moving time. Other
than that it can have no effect upon
the middle west"