The farmer and mechanic., 1915-09-28

endorse II over at once r. - -
reserve bank Of its distrirr =
ceive credit less discount a -
OF per cent per annQm Ir
Ile, the National Bank If
Io"h' can discount the note * t--
Jones having ninety davs ~ -
let US say. $500. the note
cured by warehouse receipts t.
teen bales of cotton. deductir
at the rate of per cent per
FARMER Jones would reCejI.
bank $492.50 while the han -7
once send the note with tru-- -
for collateral TO the FEEDER, t'
bank OF its district, and recer..
for $4s2-25. 1t was believed ia.
nature of the transaction vn...
peal to the banker and mak,
for him TO reduce his uS,lzr
charge, and it is thought .r..
are many farmers who win
experience for the first TIM -f
sation of getting money as ..u
per cent.
Some High Interest Rate
The Comptroller of the
has information from sworn
10 ms ONCE regarding the n.. ..,
anc average interest rates char. t
national banks throughout tn.
states. FROM the report Of .l.r. ae
1915, IT appears that there ~.
national banks in Alabama Vt.
maximum rates of interest a,.~...
26 per cent, the rate in one cas-. 80
~ per cent and in another 81 r,. e.,
The average rate of interest," u
one or these banks was charging al
OF its loans amounted to l2 r4r
another 10 per cent In Arkansas ..ra
national bank admitted maxine ,....
at a rate as high as 120 per car.
other one at so per cent. another ~ "a
and another at 25. In Georeia tr.ra
were eleven banks where the .ty,,..,~..
maximum rate Of interest va. al,n.
80 per cent. The maximum r.te
charged by one of these b4re~ 49,
40 per cent and the average ri au
loans was 5 per cent. no nenA ~
South Carolina admitted ch4re.rl-
more than IS per cent In Texas Il
number of banks reported rates AN
excess Of 100 per cent and MANY
Of them stated that their average rti.,
On all loans were / per cent per mDrth
or more.
These high rates. however. are MT
confined exclusively to the south for
the reports show occasional r.te> II
SO per cent in the East and Norh as
| we'll as in the far West and Scath
| Twelve per cent seems to be REGARDED
still as not extra ordinary by the c,4r-
try bankers of Minnesota WyuIrtug.
| Kentucky and California
| Lowest in North Carolina
| Owing either to the ueid ~ rv
| laws Of North Carolina ar tu n-
| natural shrewdness of your clt4z, T.
| the average interest rates Il Eusr
| State are lower than elsewhere IS .a.
South. While one bank in %oth
| Il l.,
as high as so per cent. lis aIer.r 4c
rate on all loans was less han y
per cent and the average rate far
| loans by all national banks u yoar
State was slightly over { per ctrL
The regulation of the Fedora IT,
serve Board granting preferential -
| discount rates as commodity paper
to notes secured by warehouse or ter
minal receipts for cotton. gram ~
| other staple commodities rrc> >laco
the maker has been charged not nor'
than per cent on discount, has trer
severely criticised by some of r.
financial journals The action of T.
Secretary Of the Treasury in deros'i
ing Government funds with som
the Federal Reserve banks has
been condemned. / am not here e
defend the Secretary Of the Treas
He needs no assistance from me u
has thoroughly demonstrated his Z 81
ity to take care of himself under
circumstances and conditions ftf ~
an undoubted legal right to ma - a'
poSitS with the Federal Reserve b"t.r
He cannot be charged with dlscrr.
nation in favor of any one section
his critics contend that no Cover
ment deposits are needed anYWh'i
and he has, as a matter Of tact q
J fered to deposit treasury fund
Federal Reserve banks Of othef 81
i tions which deposits have been ~
clined The critics Of the Secrf tai
: of the Treasury and of the comn'"i
loans regulation profess 10 be unt'
) to understand the attitude q
Secretary in making these depoS
: and insinuate that his action IS ~
: culated to shake the faith Of the ci1
nary individual in the efficiency 9! E..
new system They argue thal
amount deposited is not sufflCl'
5 large to afford extensive rehet ~
} point out that bank vaults III
} larger centers are bursting WIN ~
7 | cash and express surprise thai
2 new banking system seems unabte T.
der nreSant monetary conditions