The Watertown weekly leader. [volume] (Watertown, Jefferson County, Wis.) 1912-1917, 1916-11-01

it's bank of bankers''-the Reserve
Bank-and to pretend that it solves all
problems of the farmers when it does
not touch any phase of that question
at long distance
Now, that is only the first step in the
{ proposed personal credits organiza-
| ton. | have shown that the notes
; thus created are reliable and bankable
! but that doesn't go far enough 1t
still leaves the mass of members of
the credit union subject to the local
banker, and you must make the farm
ers more Independent than that
have talked of only one credit union
because you only want one in a
neighborhood, but there would be a
thousand such credit unions in one
State. Every borrower would borrow
enough to excess of his own actual
needs to enable him to invest 10 per
cent. of his loan in stock in his credit
union. Now. let these several thous-
and credit unions use half of their
capital by federating and establishing
a bank owned by the unions them
selves and to handle the rediscount-
ing of the notes for all the unions of
| the State. Don't you see that that
puts the whole management of the
problem into the hands of the farmers
themselves?
The monthly installment payments
go to the credit union, not to the bank,
and can be reloaned by the union,
and so earn double interest, giving a
profit to the union treasury Even
tually that will build up a fund, so
the union can depend upon it's own
capital for loans and not have to bor-
row from the bank
[ want to go still farther, I want
the cooperative banks of the States,
then, to federate on national basis
and establish one central bank to be
entirely independent Of the Reserve
Bank System, which will receive from
the 48 banks in the several States
not merely the individual farmers
notes, but the direct obligations of
these 48 banks, on the basis of which
the central bank can issue bonds
These bonds will have back of them
and under them the collective credit
of the unimpeachable character, OF
The ambitious, intelligent and honest
tenant farmers and small farmers Ot
America. While investors might not
know enough about any one individual
to want to lend him money directly
the debenture bonds of the central
bank, of the personal credits system
will be as safe and sound and desir-
able as Government bonds.
. Do not get the impression that, I'M
der this plan, only 500 loans can be
made, nor monthly installments are
vital to the system. Those are merely
illustrations. The one vital feature
is that personal character, expressed
IN endorsements of personal notes
and collective or cooperative credit
are sound security-fully as reliable
as farm mortgages when properly ad-
! ministerial
There is no mystery about the prob
lem of financing character in America
since that mystery has all been solved
| in other civilized countries and in the
cities of America dealing with wage
earnerS. through the federation OF
credit unions, centering in the nation
al debenture bank as above outlined
access will be had to almost unlimited
funds
Cheer up Ned, for long before you
can possibly get real money out OF
this cumbersome Democratic law
there'n be long heads, instead of long
ears, in the Government stalls. The
Elephant and the Moose will not eat
such fodder as the Hollis Law, with
all its roughage, and 1 doubt their
even using it for bedding. They will
demand a balanced ration-not shaw
ings and green goggles.
Yours truly,
Cousin Ben.