The daily telegram. [volume] (Clarksburg, W. Va.) 1901-1926, 1916-08-09
As Shown by Some Of Its Pro-
visions as Presented in a
Washington Article.

N1 ASSOCIATED PNhsLl
WASHINGTON, August 0,-After
many years of investigation and de-
bate to develop the best method Of
providing financial aid for the farmer
at normal interest rates and on long
time, Congress has passed a farm loan
act. President Wilson has named
members of the board which will adj
minister its provisions, and the work
of organizing the vast new SYSTEM is
about to begin.
Secretary McAdoo eX-oficial Of the
farm loan board, which will be at the
head of the system, predicts that it
cannot 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 mann
facturer has been enabled through
/. the federal reserve system to have his
paper, based on commercial trans
actions, find a ready market.
Resembles the Reserve.
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 pos
Fible 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-
TEN ever will have the resources of
the reserve system.
The act provides for a division Of
continental United States into twelve
land bank districts, with a federal
land bank in each. The work Of dcs-
ignating these districts and selecting
the centers at which the loan banks
are to be located will be the first i'm
portant duty Of the farm loan board
and is expected to result in just as
many bitter contests as preceded the
announcement Of the lines of the
twelve federal reserve districts and
the location of federal serserve banks.
The only directory provision in the
farm loan act says that land banks
shall be located with particular refer
ence to the farm loan needs of the
country, so the board will have wide
discretion. Many applications from
cities, particularly in the northwest
and southwest, already have been filed
in the treasury but the board will not
make public its conclusions until il
has Travelled over the country and held
hearings in many states.
Minimum Capital.
Each federal land bank must have
q minimum subscribed capital Of $780,
600 before it can start business. il
within thirty 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 in
the banks may pay dividends when
earned hut 'he lhlleu 9ta,eH a. q
st%ockholder cannot participate WIZ"
others.
The banks VIII not except ~ spec,
lal cases, loan direct 10 farmers, nu,
through the agency OF NATIONAL laIln
loan associations Which may 3F . or,
ganized TO any number II a laha PAM
district by any ten owners or o pro 5aos,