Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1920-05-20
ACTION BY BANKERS
ON FROZEN LOANS
MAY REDUCE PRICES
Credit Permitting Merchan-
! disc to Be Held in Storage
for Speculation Will Be
"Liquified"

WASHINGTON, May 19.-Adop-
ton by American bankers of the
recommendation of Governor Hard
il g of the Federal Reserve board, Ito
liquify frozen loans" was expected
by the board to go far toward bring
ing down prices.
Governor Harding applied to the
term 'frozen loans to credit extern
sion which was upermitting large
storage, he indicated, could be pre-
vented by strict supervision of
credit.
Representative King, of Illinois,
rencent1y charged in the house pres
ent methods of financing were per-
hitting commodities to be kept off
the market with resultant increased
prices. The Illinois representative
said he had been informed that in
New York City alone more that TO-
100000 pounds of condensed and
evaporated milk were being held in
storage in comparison with slightly
more than 100000 pounds year
ago. .,- s....
Although legislation designed to
drive foodstuffS from storage is now
pending in congress, it was said to-
day that careful withdrawal of cred
it from Spectators in food products
might accomplish more than statu-
tory regulation. 1t was emphasized
however, that discrimination be ex-
NV hoY IN N
many lines the summer months see
an accumulation Of commodities for
the following winter.
Governor Harding, of the feder-
al reserve board, is Of the. opin-
ion that liquidation of super
fiuous loans will go far to-
ward rectifying the present infla'
ton Expansion of banking credit,
due to war requirements, he told the
banker delegates at a conference
yesterday, amounted to $11 ,000,-
900, while money in circulation had
increased about $1,900,000,OO0 during
the war period. p
The SLOWING down of industrial
effort" indicated by decreased pro-
duction in important lines, repre-
scented the most unsatisfactory ele-
ment in the country's economical
problem, Governor Harding said
The governments efforts, he explain
ed, would be toward a normal, and
healthy liquidation without curtail-
ment Of essential industries, and, SO
far as possible, without disturbing
legitimate commerce."
at is evident" Mr.. Harding said
that the country can not continue
to advance prices and wages, to cur
tail production, to expand credits
and attempt to enrich itself by non
productive operations and transac'
tions without fostering discomfort
and radicalism, and that such a
course; if persisted in, will event
ually bring on real crisis"
the federal advisory council direc-
tors of the Federal Reserve banks
and a committee representing the
American Bankers association were
to the effect that initiation. has con-
tinued to some extent since the
May. This, Mr.. Harding declared to
be one of 1.-THE disquieting features
of the present situation. He asserted
that the expansion. of bankers. cred
it, properly attributable to the
war;" was about $11, 900, 100000 while
money in actual circulation had in
creased OO,000,O00. Credit ex-
pansion, even to the extent, was not
believed by Mr.. Harding to be alarm.
ing or excessive when viewed from
the standpoint of war necessity" and
when it was recalled that the govern
ment placed ,000,000,000 in Liber-
ty bonds in the same period.
Mr. Harding deplored the falling
off in production in practically all
important lines. He said it con-
stituted very unsatisfactory ele-
ment" in the. national problem be-
cause it Indicated a slowing down of
eindustrial effort"