The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1915-08-07
SYSTEM ELASTIC SAYS WATSON.


Columbia. Aug. AZ. j. Watson.
president OF the Southern Cotton con-
sress. yesterday issued the following
statement concerning the announce
ment by the federal reserve board:
II am exceedingly. gratified at the
completeness OF this announcement
from Washington. Recently 1 have
been importuned by many lead
ing men in the cotton belt States
to call the Southern Cotton congress
together to take steps looking to the
meeting of the cotton situation since
cotton began to move. / have stead
lastly declined to issue any call, feel
Ing that the development of anything
like the hysteria OF last year with
our international relations in so del
icate position would mean the dis
sipation OF the optimism now prevail
Ing and would clog the wheels of
business. For some weeks, acting
along with others who know the cot
ton situation thoroughly, we have
been in communication with the
White House and. thereby, with the
regional reserve bank system, and
the assurance had been given that
everything possible would be done by
the national government to protect
one of the nations great assets, the
only one that preserves the balance
OF national trade. Last year when
the cotton crisis came as a result of
the outbreak OF the war q short time
before there were no warehousing
facilities to amount to anything. Cot
ton was still regarded as a commodity
and not as basis of credit In the
first week of the war and the ex-
element We accomplished the recog-
milton by the United States govern
ment Of cotton as basis of credit,
which was the longest step ever taken
IN behalf Of the Souths and the ma
tion's principal product of the soil
NJ that time there was no regional
icStTNt Ddnh system.
''The nation was working under
the old banking laws and under the
Aldrich-Vreeland emergency act, de-
signed to aid in the change to a
completely new banking system i'm
the nation. 1t was impossible with
In reasonable time. certainly in
time to aid the situation, to get the
new regional reserve system in op-
Grafton. and that situation caused
most Of the difficulties through which
the South suffered. Now II is a diff
terent proposition. The regional re-
serve system Is elastic, and even If
the markets OF the world are closed
that system ought TO and probably
will easily take care of at least one
half of the total cotton crop now
about to be harvested, as well as the
paper issued against cotton stored in
warehouses and now held over from
last years crop. Warehouse re-
ceipts. particularly under the system
established In South Carolina, are
nov negotiable paper. as this an
nouncement from Washington indi-
Gates and the bale of cotton is a ma
tional bank collateral. This an
nouncement from Washington is
exactly what those of us who have
been communicating with the admin
istration hoped would be made. and
1t points the way to the banks of the
South for the successful handling Of
the situation this fall. 1t may he
necessary for the administration, in
case the crop is an abnormally and
exceedingly large one. to take some
other international step for the ham
ding of such cotton that the regional
reserve system can not care for, but
taking into consideration the report
recently issued by the United States
department Of agriculture it now
looks as IL the tremendous losses Of
last year despite the closing of the
| ''"i hVlo VIII nOl ItSull Ill I1IO. III
this statement the regional reserve
bank makes IL Very clear that ware
housing and insurance OF cotton and
the issuance of properly secured re-
ceipts IL absolutely essential To the
handling OF the situation by the sys-
TEN. and II also points to the neccs-
sity FOR all banks that have not yet
become member banks to get them
selves into condition to avail them
selves Of tho opportunities offered Ivy
the new federal reserve act. AZ
president of the Southern Cotton con-
grcSs | wish To say that feel greatly
relieved and gratiiicd at the am
nounccmcnt made in the press today.
and ! really believe that there Is
now VERY little occasion for ncrvnue-