New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1920-11-03
CREDIT SQUEEZE WORKED BY
INTERLoCKlNG BOARDS
OF INSTITUTIONS.
st 5Sss5 u ~ VI s;sss 5. y.gslet 1
BANKERS HELP GRAIN BEARS
CHARGE MADE BEFORE U. Hi
S. COMMISSION:

paper, will no doubt prove OF interest,",
especially to our many farmer readers
It also gives the urban residents an
opportunity \ to see how the grain
markets are, manipulated by the big
interests against both the producer
and the consumer.
Evidence that the motive OF the
Minneapolis banks in restricting the
credit Of the farmers is a desire TO aid
grain dealers in separating the farmers
from Their crops at a. sacrifice price
was furnished today in the disclosure
that these banks are connected by
inlterlocking directorates with prac-
tically all the large milling and gram
interests Of the northwest.
Presidents and officers OF the banks
are members Of the chamber OF COM
merce. Many Of the bank directors
also are members Of the chamber or
are connected with firms that are repre-
sented. in the chamber. The men that
control the. grain trade control the
banks . .
Recalls Jaffray Letter.
In view of this fact, the sletter sent
out on Aug. 6 by G. 7. Jaffray, presl-
dent of the First National bank, to
country banks in the Ninth federal re-
serve district, urging themto get their
loans to farmers reduced at as early a
date as possible $50 that we in turn
will be able toshelp the movement OF
farm products to the markets by loans
to all grain merchants" acquires a
new significance:
Mr. Jafray IS himself member of
the chamber Of commerce, holding his
membership 4 on behalf Of the First
National bank, Associated with him
on the banks board of directors are
some Of the most powerful figures in
the grain and milling world.
Banks Help Grain Bears.
Charges chat the grain and b anking
interests of the northwest are almost
Identical were made before the Federal
Trade commission recently by repre-
sentatiyes Of the Equity Cooperative
exchange of st. Paul, at hearing on
the grain trade. The Equity men
urged the commission ito investigate
the charge, declaring that, if true,
I it meant that the interests Of the farm
ers are at the mercy Of a huge trust.
It is believed the commission did in
.vestigate the point, though it's report
has not yet been issued.
Minneapolis grain men told the com
mission there was nothing in the
charge. They said while it might be
true that an officer of an elevator or
milling company was occasionally a
bank director also, the degree of affili-
alton between the banks and the grain
trade was not sufficient to ineance the
farmers. The truth is the degree Of
utilization is SO great as practically to
establish an identity Of interest be-
tween the banks and the grain trade.
Acting together the banks and the
grain men can often induce a rapid
marketing OF grain at the very moment
when bear operators in the wheat pits
are hammering prices down.
Market Drop Shows System.
Events in the last few weeks have
shown how the system may be made
to work. In, less than 80 days wheat
prices were re- uced 81 bushel, while
bankers were exerting all the influence
at their command to hurry the crop
to market. Only bitter resentment
among the farmers at this trick and a
united resolution to defeat it, has pre-
vented precipitate marketing and a
more vigorous slashing Of prices.
The feeling among the tanners is
such thatSth banks have been forced
temporarily to cease pressing for Ii
quidation1of agricultural loans, They
are even granting additional accommo-
dalton to farmers. They are resolved,
nevertheless, to renew their pressure
at the. first favorable opportunity.
Admit .sLack Of Tact
Minneapolis bankers admit they had
to bow before the storm Of feeling Gre
ated by publication in the Daily Star
of letters sent to country bankers by,
Governor Roy Young, Of the federal.
reserve, bank, and. G; 4. Jaffray; pres.
ident of the First N ational bank, turg-,
Ing that farm loans be, called ii. These
letters, it is5now eded, were Ia cking.
in tact. They had the reverse effect
from that intended They made til
very difficult for bankers tos approach,
farmers on the subject oflldan5 liquida-
tion. 4 s3. i.
Some bankersss try to- explain the
slow marketing Of the crop, and their
Indifferent sue cess il obtaining liquida-
ton Of farm credits: to the fine wea-
ther, which hassbeens avorable for fall
blowing, They sayeit would be poor,
A 81.