Pine Bluff daily graphic., 1920-05-19
{KERs PLEDGE l|D IN DRIVE ON
 PRICES, INITIATION
cunnrt Reserve Boards nn to Discourage BOr- 1 rowings
rAMMENT OF PLEAS EoR CREDIT IS ASKED
Eu Warns That Present Prac' ! May Bring Serious Crisis l tho Nations Business
 Affairs

bington, May 18.--Bankefs o1 ,ntrv. thru representatives at conference today with the reserve board, pledged them in helping the board in a on high prices and to aid in at deflatlon.
 bankers agreed to support un- bdlv the boards new policy in raging "habitual and unneces- orrowings" and to seek cur pt of Hong standing, nones- loans" as an initial step to- lnding the era of high prices eculation.
 rnor Harding set forth the policy in a speech designed tc the general situation and to the governments views. He of impending dangers in the of continued borrowings and tion and appealed to bankers blic alike to be conservative in hands for banking credit.
 evident" MT. Harding said he country cannot continue to prices and wages, to curtail tion, to expand credit and at- to enrich itself by nonproduc- erations and transactions with tering discontent and radical hd that such a course, if per in, will eventually bring on a isis.
 Expedite Circulation.
 Harding said that "everything be done" to expedite the re- f money in "frozen loans" and modities held either for spec purposes or because of lack nsportation and urged bankers the utmost discrimination in pg new loans. Reports laid be- he conference by the federal ry council, directors of the reserve banks and by a con- representing the American fs' association were to the eff bat inflation has continued to extent since the Notation of etory loan last May.
 Mir. Harding declared to be the disquieting features" of esent situation. He asserted le expansion of banking credit ply attributable to the war; lcut $11 .000.000,0O0 while mon- lctual circulation had increas- 100000, ,000. Credit expansion that extent was not believed Harding to be alarming or ex- when viewed from the stand cf war necessity" and when it called that the government $26,000,00O,OOO in Liberty in the same period.
 Harding deplored the falline the production in virtually all ant lines. He said it constitut- ery unsatisfactory element" in lonal problem because it indi- slowing down of industrial " effort should be made tt te necessary production espe- oi 1ood products, and to avoid Mir. Harding continued.
 gress toward the restoration Of relationshin between the vol goods and the volume of credit made by reducing credit more than production is diminished increasing production at a rate than credit is expanded mould prove impracticable in stlng circumstances to increase al production, then we must economy in consumption and moderation in the use of cred
 the tendency toward a fur denlng of the margin between lnd credit.
 To Avoid Shock.
 problem, therefore. is to check expansion and to bring about
 ana healthy liquidation with ,aiilng essential production snout shock to industry, and as possible. without disturbine a'e commerce and business" ederal reserve banks, MT. Hay eciared. conld do much in the U ol curtailine credits of mem. 'ks by informing them of the amounts thev could borrow ,e reserve institutions. He az. .nls would compel the individ. .kers to examine carefully al tlons for loans
 nall measure of the difficulties present situation were attrib.
 MT. Harding to the naticr Ie'gnt congestion He added " " however. that the freiph, 's rh hot responsible for profit .e!. ahe board expects to dea ;tMllteerlng Gin another way, n, n1ut ,.aout indicating what method. nder consideration. ile'ght jam was discussed q, ns ~nu resolutions with respec ns or bringing it to an ent