Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1915-09-03
1.-THE FINANCING OF COTTON
State Warehouse Commissioner Ad.
VlSeS Farmers Of Situation.


PRODUCERS In FOR A HARD fight
Statistical Position of Cotton is Al
that Could be Desired, and Ultimate
Good Prices are lnevitable; But the
| Producer Must be Careful If he Gets
the Benefit of the Price to Which hs
is Entitled.
Editor Yorkville Enquirer:
1 will appreciate it if you will give
space to the following statement to the
farmers of South Carolina:
| We are approaching the marketing
period for our crop under conditions
never before presented. We can secure
prices above the cost Of production II
we place ourselves in a position to
take advantage of the opportunity. We
need not deceive ourselves that 1t will
not be a hard fight, because those who
have heretofore profited by forcing the
crop out Of our hands at a low price
, during the marketing period and reap
ing an enormous profit in the spring,
will use every effort to do so again.
Yesterday, on a report which could not
possibly be construed as indicating
much over an eleven-million bale crop,
the market was forced off one dollar
and seventy cents per bale.
In anticipation Of these tactics, l
wrote President Wilson a letter on the
5th of August, specifically calling his
attention to the necessity Of immediate
action. In his reply the president ex-
pressed his genuine interest" and
promised to discuss it with those who
understand the matter better than l
do" He conferred with Mr.. Harding,
of the Federal reserve board, and Mr..
Harding, during the course Of an ad-
dress delivered in Birmingham last
Wednesday night, read a letter from
President Wilson, which, together with
the address, is all that we could ex-
pect. Mr.. Harding said "the welfare
of the south depends upon this crop
being marketed at fairly remunerative
prices; the prosperity, or the reverse,
Of the southern farmer means strength
or weakness of the merchants and
bankers of the south, and vitality af-
fects trades and industries throughout
this entire country. Let the southern
bankers" he said, wherever possible
make liberal concessions in their usual
rates on commodity loans. High in
terest rates mean forced sales. Pres
ent conditions fully justify low rates,
and southern bankers should be willing
to forego temporary profits for the
sake Of securing and solidity in the
future. l am sure that the Federal
reserve banks may be depended upon,
under their power Of rediscount, to
cooperate to the fullest extent with
the banks in taking care Of the cotton
crop. What better security,
therefore, could a southern bank ask
than the obligation Of a merchant-or
farmer which he has been carrying on
a crop not yet existing-what better
or more liquid investment, could a
southern banker find, than to carry
this same obligation for a few months,
if necessary. secured by the actual
cotton properly warehoused and insur-
ed, and certain Of market?"
President Wilson's letter Is as fol-
lows:
my Dear Mr.. Harding:
Thank you sincerely for your letter
of August 22d. 1t gives me just the in
formation l desired. What interests
me most Is this: it is evident from
what you tell me that the country
banks with whom the farmer and other
producers directly deal can get money
at from four to four and one-half per
cent, and that the question whether
the benefit of this advantageous rate
is to be extended to the farmer Is in
their hands. 1t is inconceivable to me
that those who are responsible for
dealing directly with the producers OF
the country should be willing to jeop-
ardize the prosperity Of the country
itself by refusing to share with the
producers the beneficial rates now OBJ
tainable for money loaned. I think
that we can confidently expect that the
banks in the cotton states and in the
agricultural regions generally will
content themselves with a rate not
more than one or two per cent above
the rate which they themselves pay.
hope that the facts which you have
tod IN N1yi11 hnnnnnn
known among the producers Of the
country so that they may feel them
selves free to exact of the banks with
which they have to deal what they un-
doubtedly have right to expect.
Sincerely yours,
Woodrow Wilson"
Note carefully that the president OF
the United States tells you to feel free
a right to expect.
On August oath, Secretary McAdOo
announced that if it became necessary
he would deposit thirty million dol
lars or more of gold in the Federal re-
serve banks at Atlanta, Dallas and
Richmond, "for the purpose of enabling
the reserve banks to rediscount loans
on cotton secured by warehouse re-
ceipts" He stated further that this
money would be deposited without in
terest charge, and that if it became
necessary he would make the deposits
directly with the national banks which
would agree to lend money on cotton
at rate not exceeding six per cent.
He also said that for the time being
the treasury department would charge
no interest on the deposits in Federal
reserve banks. and justified his action
by the unusual situation respecting
cotton caused by the European war,
saying that he considered it his duty
to use every available means in his
power to help the cotton producers of
the south under such conditions; that
it was "of economic Importance to the
entire nation that those who produce
the cotton crop shall have n fair op-
nort1nity IN disDOSe Of n pradually