Arizona republican., 1920-05-27
When Doctors pisanree


 In issuing his statement on Tuesday from Ponca, Oklahoma. protesting against increase by the federal reserve board of redscount rate Owen was presenting another aspect of his contro- versy with Governor Harding of the federal reserve board arising from the action board recently. directing the member to restrict and retract loans.
 When two such as Senator Owen ernor Harding differ financial policy, the rest of us well stand aside and await velopments for temporarily without chart compass. Governor Harding was chosen for his posi- ton because of his experience and in finan- eial affairs. Senator Owen is the acknowledged leader in financial legislation senate ablest member of the body in that respect, with the exception of the late Senator Aldrich perhaps more familiar with his country's the worlds finance systems than any man who has sat in the senate in the last quarter of a century. His influence in the federal legislation than that of any other member of either house.
 His first objection to the proposed action of the federal reserve banks. however was based on mis- apprehension of the purpose of it-defation to be judicously brought about break accumulated stocks of various kinds of commodities. Many thought the there contemplated 9 general retracton of credit which would affect all industries and them when they rather needed encouragement and stimulation Such a policy was misapprehended would course have involved all industries a disaster. But when it plain only the profiteers. the spectators
 
 useful industry would be encouraged, before, the action board given country's approval.
 Senator Owens present objection though goes to another matter raising of the interest which affects adversely legitimate industry. Whether is necessary or not in the process defation may be subject of dispute but any lessening Of the volume of the circulating medium would under the law of supply and inevitable increase of the price of it the premium it, that is, the interest rate
 As the objection of the to the action of the board with respect to government bonds eurity.-the Liberty Victory bonds being. believe, the only likely be affected-it grettable that the price of them should be forced down. But that would appear to the layman to be the any effective process def1ation for those bonds have been large contributing factor our unwholesome inflation Long before the federal board took this action perhaps before it contemplated any. the that being made of the bonds kept their value down. They became effect part of circulating medium. They used buy silk shirts diamonds and all sorts of luxuries They flowing through hundreds thousands channels into the hands speculators who using them security for further loans and thus they were instruments for further in fation closely to the point of explosion. We were constructing inverted pyramid to danger ous height.
 The use that was being made of the bonds was not which the government contemplated when it appealed to the patriotism of the people. Helpful the bonds in carrying the war, they had threaten the country's prosperity. They in creasing the burden of high prices. The sloughing off of them by holders incident in the '. of popular extravaganza.
 thought would implant habits of thrift popular loans in other tries made the people thrifty. But instead. the use were making of them only a means to make careless and wastefu than
 We do not of course mean to say that the i'm proper use of the bonds have described was uni versal. Hundreds. perhaps thoIIsands of persons need legitimate and useful purposes the money they could procure them security. Such per sons suffer loss and a real hardship in quence the action of the reserve board But that appears to in the process of removing this most influential element of imitation.