The Sun. [volume] (Price, Utah) 1915-1932, 1920-07-02

lgcnt OF inc NNllOum WOOL NuFe- !
house and Storage company at Salt
Lake City, has received a wire from
the conferences, stating: 1.-The fed |
ernl board will finance wool ON bills
of lading or on warehouse receipts
through member banks. The banks
should advance not less than thirty TO
forty cents. Wool prices not bad. ~
Austin Bros. are in receipt Of n letter
dated June oath from the National
Wool Warehouse and Storage COM
pany ut Chicago, saying: 1--WE have
observed the advantages accruing to-
Iowa woolgrowors from marketing of
their wool through this company last
season. whereby actual values were
obtained for the grower, the bankers
having volunteered 10 cooperate by
loaning money direct 10 the farmer on
wool consigned 30 MS. This resulted
in obtaining for the grower an aver
age of ten 10 twelve cents n pound
more for his clip than he could have
obtained by selling locally, and in re-
timing in Iowa several hundred thou
sand dollars that would otherwise
have followed the SPECTATOR out of
the state" The warehouse and stor-
age company. issued last Friday n
circular. which not only Hooper, but
other prominent Utah woolmen be-
licvc will attract general attention.
Quick Plans Necessary
Referring 10 stagnant market con-
ditions. the circular says: These
conditions ncccssiiatcd n quick work
ing plan by which the wool business
rs "a whole could be protected and
markets stcadied. enabling wool 60
be stored and made available for dis
tribuiion 10 the market demand in n
normal way. A request was granted
by the federal reserve board nj Wash
ington. ID. C.. for a meeting Monday,
June Dist. which was attended by
woolgrowcrs. bankers ia wool pruduc'
ing sections. buyers, warehouse men,
manufacturers and other interested
parties. The following statement wna
agreed 90 by the federal reserve
board.
"a woolrrowcr mny ship has wool
10 one of the usual points of disiri.
button. obtaining from the railroad d
lHll of lnding for the shipment The
grower may then draw "a draft against
his bnnk for such un amount as mas
be- agreed upon by the grower and
ne hank. secured by the bill Of lad
,inc. The federal reserve act author
izes any member bank to accept d
draft secured In this manner az III,
time of acceptance, provided that
the draft natures IN not more thar
six months from date of acceptance
Altcr acceptance. such "A draft bear
ing the Endorsement of member
bank is eligible for rediscount or pur
chase by a federal reserve bank, pro
yided, that IL has a maturity of no
more than three months from th
date of rediscount of purchase. -
AS An Illustration.
An illustration of financing Woo
shipment upon an acceptance ns sug
gestcd by the board would be abou
like this: The customer owning th
wool will arrange with his banker, n
10 the amount the banker As willinl
10 advance against the wool, the WOO
10 be free or release 10 be obtuine'
for mortgage or any other lien. tn
owner will determine 10 what ware
house he desires 10 ship, then load hi
wool and obtain bill of lading there
for. He will next draw drat
against his local bank for the amour
agreed upon as an advance. TIN
draft may be payable within an
period up 10 six months from dat
but cannot be rediscOunled at th
federal reserve bank il maturity
beyond ninety days from date, TIL
banker will then accept the draft b
writing the word accepted acros
lbs face, over the signature of som
official of the bank, and will attoc
the bill of lading 10 the draft as co
! lateral.
The banker will then make Oh
. proceeds available at whatever rat
of discount agreed upon with th
maker for the maker s use, and the ~
eeptance is then Immediately eligibl
for rediscount at the federal resor,
bank and should he presented TO III
bank ia the district of which the az
cepting bank is a member, This stat
ment ispredicated on the theory tia
the accepting bank is a member
the federal reserve. Ii the bank
not member, but has acceptan'
nrivilaOas uudar the. state law undo
which it operates il may accept, bl
such acceptance TO be eligible for r
discount at a federal reserve ban
must carry the Endorsement Of amen
Der bank of the reserve system.
Utah woolmen who have receive
thi. circular are breathing easier al
; lbelieve that within sixty days Yves