The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1916-08-12
The FARM LOAN BOARD.
FIRST SESSION AT TREASURY DE.
PARTMENT.
Work Of Organization Expected tn
Take Several Months and Require
Long Journey.

washington, Aug. 6.-The new farm
loan board, charged with organization
OF the federal land bank system pro-
riding methods for making loans to
farmers on first mortgages of land.
Will hold the first meeting tomorrow
at the treasury department. The
most important preliminary work of
the board will be q division of the
country into IL federal bank districts
with land bank, which will furnish
the funds for the loans in each dis
trict. ,~it
Forty cities already have applied or
have been recommended for banks.
Before it reaches any decision the
board is expected to travel across the
continent to hear the views of farmers.
1t is probable this work will take
several months.
Secretary McAdoo is chairman ex-
officiO of the board and the other
members, appointed by the president
and confirmed by the senate, are c. E.
Loudell, George w. Norris, S. A. Smith
and Herbert Quick.
Secretary McAdoo predicts that it
can not be in operation for at least
six months and probably loans can not
be made before next spring.
In operation the system to some ex-
tent will do for the farmer what the
federal reserve system does for the
business man. The farmer will be
given opportunity to secure money on
his most available commodity, his
land, just as the merchant and manu.
facturer has been enabled through the
federal reserve system to have his
paper. based on commercial transac-
tions, find a ready market.
The new scheme has many points
of resemblance to the federal reserve
system but in many essential features
it is entirely different. In no way will
the banks created under it do COM
mercial banking, and while it is possi-
BILE that in years to come they may
have funds to loan that will amount
to several hundred million dollars, it
is not believed probable that the sys-
tenn ever will have the resources of the
reserve system.
The act provided for a division of
continental United States into IL land
bank districts with a federal land
bank in each. The work of designat-
ing these districts and selecting the
centres at which the loan banks are
to be located will be the first import
ant duty Of the farm loan board and
is expected to result in just as many
bitter contests as preceded the an
nouncement of the lines of the IL
federal reserve districts and the loca-
ton Of federal reserve banks. The
only directory provision in the farm
loan act says that land banks shall
be located with particular reference
to the farm loan needs of the coun-
try, so the board will have wide dis
cretion. Many applications from
cities, particularly in the Northwest
and Southwest, already have been
filed in the treasury. but the board
will mot make public it's conclusions
until it has travelled over the coun-
try and held hearings in many States.
Each federal land bank must have
a minimum subscribed capital of
$75O.O00 before it can start business.
If within 80 days after books are
opened for subscriptions to the stock
Of any of these banks individuals or
corporations have not subscribed that
amount the secretary of the treasury
is directed to subscribe for the United
States in the needed sums. Stock i'm
the banks may pay dividends when
earned, but the United States as a
stockholder can not participate with
others.