The Lancaster news. [volume] (Lancaster, S.C.) 1905-current, 1919-02-11
Would Make Farm Loan Bonds
Legal Investments for Saw
ingS Banks.
SUGGESTED BY McADOO
Gov. Cooper Transmits Letter
from Former Secretary of
Treasury in Special Massage
to Legislature.

ernor Cooper in special message
Friday transmitted letter from w
G. McAdoo. former secretary of the
treasury, asking that the general as
sembly pass law making farm loan
bonds legal investments for the
funds of savings banks, insurance
companies. trust companies, and for
guardians and trustees. Accom-
panying the correspondence is a copy
of the act desired, which has the ap-
proval Of the treasury department Of
the United States.
Il respectfully recommend that
you give this bill favorable consid-
eration." the governor said, land
that the same be acted on at this ses-
sion OF the general assembly"
The second paragraph OF the gov
ernor's message reads:
Il am informed that the legisla-
lures of most of the states have al
ready acted favorably on this bill. In
this federal land bank district, COM
posed of North Carolina, South Caro-
lima, Georgia and Florida, the states
OF Georgia and Florida have passed
the bill, and it is now in force in
these states. I am also informed
that the bill has received a favorable
report by the committee on agricul-
ture OF both the house and the SEN
ate in North Carolina, and Governor
Beckett is OF the opinion that 1t will
pass without difficulty"
In explaining the purposes OF the
bill. Mr.. McAdoo said:
ITO secure an adequate supply of
money for the very vital and urgent
purposes of making such mortgage
loans as the farmers of the country
need, the federal land banks issue
bonds secured by the deposit as COL
lateral of first mortgages on land
The farm loan act provides tha
these bonds shall be a lawful in
vestment for all fiduciary and trust
funds, and may be accepted as Sc
curity for all public deposits This
of course relates only to fduciary
and trust funds under the Jurisdiction
and control OF the federal govern
ment In order to make these bonds
lawful investments for the trust
funds and savings banks in the vari-
GUS states. It is necessary that each
state shall enact laws to that effect
unless such laws are already in ex-
istence.
such legislation will accomplish
the double benefit OF putting within
the reach of trustees and guardians
an absolutely safe investment. yield
ing a satisfactory income, for the
beneficiaries under their trust. and
widen the opportunity for a safe in
vestment OF the savings of the
masses, while, at the same time, it
will prove OF immense benefit to the
farmers of your state in enlarging
the market for farm loan bonds and
farm mortgages.
The constitutionality OF the act
has been passed upon by the attor-
nev general Of the United States. on
behalf Of the farm loan board and
by former Supreme Court Justice
Hughes, on behalf of private inter
ests; and the IL federal loan banks
have already made loans to the
amount of approximately $4,000
900, and have sold more than $40
900. 900"
The following is the body OF the
proposed act
Section l. Any savings bank.
banking institution. trust company
or insurance company. organized un-
der the laws OF this state. or any
person acting as executor. admins
traitor. guardian or trustee. may in
vest in federal farm loan bonds is
sued by the federal land bank or
joint land bank organized pursuant
20 an act of congress entitled AN
act to provide capital for agricul-
tural development. to create stand
ard forms OF investment based on
farm mortgages. to equalize rates Of
interest on farm loans, to furnish