Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1920-04-26
TRAFFIC SITUATION Is AZ
FEcTING BUSINESS Sc
RIOuSlY.
GRADUAL TIGHTENING
OF MONEY MARKET
Federal Reserve Bank Of Chicago
Shows How Delay in Traffic 10
Preventing Turning Raw Materials
Into Cash-unabIe to Deliver Goods
After They Are Sold.
TO Times Republican.


Des Moines. April es.-In its report
on business conditions in the middle
west made public today the federal
reserve bank OF Chicago, serving the
seventh federal reserve district,
points out that there has been a
graudal Tightening OF the money
market and that the traffic situa-
ton is seriously affecting business.
The report declares that there is
almost an Unsuitable demand for ev
erything produced but the lack of
freight service, the scarcity Of raw
material and the labor shortage are
not only making it increasingly diff
ficult TO produce but these things are
combining to prevent the turning Of
raw materials into cash and cash
seems TO be the one thing needful.
While the car shortage has pre-
vented a free movement of finished
manufacturing facilities by non re-
ceipts OF materials, fuel and sup
plies" declares the report the in
terruption Of transportation by
slI ines has IAOusAI dcSuN d AuOlc
acute condition. Collections have
slowed down during the last sixty
days but this is explained to some
extent by the inability to deliver
goods after they have been sold and
by the condition of roads in the
country districts. With more set
tied weather conditions in the coun-
districts fo
may DC expected
Grain Congestion Freezing Credit
The report declares that agricul-
tural borrowings continue persistent
and that grain congestion Is t-ee=
ing credit.
9 Nearly two months have elapsed
since the great demand in connection
with farm land transfers became ap-
parent" says the report. The IL
quotation which usually follows such
activity has not taken place to the
extent expected. There is no ques-
ton that the lack Of transportation
facilities has had much 20 do with
this but ii IS quite possible that this
one feature may be unGuly empha-
sized
Government reports do not indi-
cate much more than a normal per-
centage Of grain in the hands of the
farmers while their obligations to
their banks are much larger than a
year ago. Advices in answer to spec
sections OF the corn belt support the
government estimate and fail to in
dictate that the supplies of grain and
live sock on the farms ready for
market are abnormally large COM
pared with other years. Hence the
perple1ing feature of the insistent
at the country banks and
the demand upon the reserve banks
in consequence.
Real Estate Loans Heavy.
1T is difficult, therefore, to escape
the conclusion that many banks in
this territory are carrying a larger
amount than usual of real estate
loans based on farm lands at high
values or OF unsecured paper given
in connection with such transactions,
which. however good in itself. can
be Hquidate only out of the proceeds
of crops which are not yet in the
ground.
Practically every bank replying to
general inquiry reports that there
has been a greatly increased use of
credit by farmers as well as manu-
tacturers. This situation is particu-
larly aggravated in some OF the agri-
cultural districts where farmers
have not been able to market their
grain because Of bad roads and in
adequate cars and where elevators
are filed to capacity"
The report declares that bankers
are discriminating IN extending
credit but that this discrimination,
If followed turnout the middle west,
should result in a considerable con-
traction in the volume of credit
without injuring those engaged in
legitimate business or imparing the
ability to obtain credit where it is
essential"
The report further points out that
with the present volume of business
causing a strain on the resources of
the nation failure on the part Of any
factor in the situation to properly
function increases the demand for
credit and adds to the financial
burden resting on the banking sys-
TEN. This condition is what makes
strikes and expressmens'
strikes SO costly the report declares.
ut h 1r ho