The log cabin Democrat., 1920-05-20
ONLY CROPS TO BE
EXTENDED CREDIT
BANKS TO LIMIT LOANS
General Financial Condition Reflected
in Attitude of Local Banks Re-
stricting Credits.

The financial situation in the nation
at large, which has been marked by
big declines in the values of bonds,
stocks, commercial paper and in some
commodities, is being watched closely
by Conway bankers, who have already
taken steps to prevent further infa-
ton Of credit and restrict loans almost
exclusively to the purpose of assisting
farmers in producing crops.
At the same time they are discour-
aging and refusing to finance any new
enterprises, the local banks are stroag-
ly urging their farmer patrons TO in
crease their food crops. 'The present
weather conditions, which will force
hundreds of acres of cotton to he re-
planted in corn and other feedstuff,
may prove a blessing in disguise" a
leading bank official said here today.
at is evident that food is going to be
short throughout the nation this year,
and our farmers, if they fail to pro-
duce any at home, might find it i'm
possible to buy, even at high price.
to finance the present crops" he said,
although, of course, we are discour-
aging any expenditures in making the
crop above what is absolutely neces-
sary. But the farmers Of this coun-
ty need feel no alarm about the pres
ent financial situation. Every farmer
to whom banks or merchants have ex-
tended credit on which to make a crop
and who is making an honest effort
to do so need have no fear that he
will be left stranded and refused credit
to complete his crop.
But our bank" this official contin-
ued, "and believe it is also the policy
of the other banks, has definitely de-
cided that it will not under present
conditions finance any new buildings
or other improvements that can rea-
sonably be deferred, or any land deals,
and that it will not enlarge mercan-
i tile credits already granted. We
heartily agree with the policy of the
federal reserve banks in forcing re-
! auctions of bushes scredits, to the
extent that profiteers, both wholesale
and retail, may be forced to unload
and severe blow dealt to excessive
prices in all lines"
| Resolutions along the lines referred
to, which were adopted by commit
tee of bankers in conference with the
federal reserve board in Washington
yesterday, were as follows:
l. That the banks reduce their to-
tai loans by 10 per cent, or more than
that if a greater expansion is neces-
sary for the fall movement of crops.
In contracting loans the banks are
urged to discriminate carefully be-
tween those for essential and nom
essential purposes, preference being
given food production.
2. That the federal government
defer until after the crop movement
all expenditures except those absolute
ly necessary. 1t is urged further that
borrowings be reduced to minimum.
3. That states, counties and cities
defer proposed issuance of bonds, thus
avoiding competition for credit. Pub
lie improvements, it is suggested,
should be postponed in order to help
the labor and material markets.
A. That individuals and business
concerns postpone such construction
as is not imperative.
s. That individuals increase their
savings deposits in the banks and
spend as little as possible, limiting
their purchases to necessaries.
Have tuned so pianos in Conway.