The herald and news. [volume] (Newberry S.C.) 1903-1937, 1915-01-12
SOME QUESTIONS FOR
FEDERAL LRESERYE BOARD
OF GREAT IMPuRTANCE TO r
PEOPLE
Statement of Congressman James In
Regard To His Proposed $751;
- 0OO,O00 Loan.

The following is copy OF letter
sent by Congressman Robert l.. James,
of Texas, to the federal reserve board,
and sent to The Herald and News by
Mr. James. 1t contains some per-
tinent questions.
Also will be found below statement
given out by Mr.. James in regard TO
his proposition for tine government
to deposit s25O,0oo,OOO in Southern
banks to be loaned to cotton far
F.. mers at a rate not to exceed four
per cent.
January 6, 1915.
The Federal Reserve Board, Washing
ton, D. G..
Gentlemen: You are, 1 AM sure
aware of the business depression in
The cotton States, brought about on
account of the inability of European
!, countries to purchase the usual an
nual supply of cotton. We must agree
that the purchasing power and TIE
- debt-paying ability of the South are
hampered and almost paralyzed at
this time on account of the low price
of cotton and because the cotton crop
has not moved as in ordinary times.
These serious conditions in the
Southern States cause me to address
several inquiries to yo>. which l deem
OF great Importance to our people,
TO wit:
First. With the approval of the
Federal reserve board would the fed
geraI reserve banks at Dallas and At
lanta be authorized, under sections
13 and 16 and other provisions OF
the act. to accept for rediscount from
member banks the notes OF cotton
farmers. bearing interest at the rate
of four per cent per annum, secured
by warehouse receipts, with matuT-
ity Of six months, and with the un-
derstanding that such notes may be
n renewed for an additional six months?
3 Second. As a war measure in THIS
erisis brought on the South by the
hooking conditions in Europe, has
lot the the federal reserve board the
sawer to make a definition authoriz-
khe discount o. farmers notes, as
sted in the preceding paragraph,
to make available federal re-
notes to be loaned to the banks
Rtton in accordance with the
have just outlined?
u I'd. With the federal reserve
suggesting such course and ap-
ing the action, would not member
Ks Of the federal reserve system
authorized to accept these SIX
SS tbs notes, bearing four per cent
2s est and secured by warehouse
I'M BITS on cotton at a valuation not
Sding the market value of the cot
H s1rth. 1t seems to me that the fed
reserve act was brought about to
as an emergency measure as
Bell as q permanent system and that
the federal reserve board would De
yell within the proprieities and their
authority to make the suggestions in
dicated by me and to include the
definition as proposed touching this
kind of paper to be eligible for re-
| discount in this temporary crisis over
hanging the South.
Hence I urge that your honorable
body take the initiative in this dire
extremity so damaging to thirty mil
lions of Southern people and pro-
vide a way for their relief If YOU can
find your way clear to pursue this
course and make federal reserve
notes available in this way to the
producers of cotton on the terms as
outlined by me, you will make it easy
1 for the cotton farmer to pay mis- debts,
to finance his needs during the year
j 1914, and to feed and clothe and sup
ply his family's wants during the year
! 1915. He can, by this means, pay
mis- obligations incurred for last year,
nsatisfy his merchants, and make ar
Angements for supplies during the
SNr resent crop var.