Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1920-12-04
COUNTRY IN FOR
PRICE SLUMP IS
HOUSTON s VIEW
Believes 1t Would Be In
wise for U. S. to Resort to
An UnSound Banking Pol
icy to Relieve Growers.

Washington, Dec. 3.--The con-
gressional Joint committee hearings
on the agricultural situation de-
veloped today in dispute at times
quite heated, between Governor
Harding of the federal reserve
board, and members of congress.
Mr.. Chairman, what is the pur-
pose this hearing ?" Governor
Harding finally demanded, while
being questioned by Representative
BMnes, democrat, of South Caro-
lima. as the federal reserve
board on trial; am l on trial here 2"
he continued, declaring he had
been a target for all kinds of
abuse"
Representative Byrnes said he
meant no reflection on Governor
Harding. Fa
Circulars issued by the regional
reserve bank of Richmond, Va, to
member banks and which Mr..
Byrnes was attempting to show had
resulted in rigid restriction of
farmers credits, were under dis
cussion. Governor Harding said
such circulars were not submitted
to the board until printed. when
they were looked over, and atten-
ton of the regional bank issuing
them called to anything the board
deemed unwise.
Board Not Central Bank.
The board, he added, was not a
central bank.
At one point Governor Harding
told Representative Byrnes he
Ought to read the federal reserve
act and try to understand it." Mr..
Byrnes replied that he did under
stand the act, as he had helped
frame 1t.
Senator elect Helm, Alabama,
asked Governor Harding II the law
makers could issue a statement TO
the public as understanding his
testimony to be that the reserve
board was favorable to banks ex-
tending all the credit possible to
farners-
1.-The federal reserve board pre-
fers to issue It's own statements
Governor Harding replied,
Plainly Specializing.
Approving efforts of the Rich
mond bank to restrict loans Tor
non -eSSeiluHl PURPOSES 10 A"A"'
Governor Harding said:
81 know some banks in South
Carolina had been carrying large
loans on cotton, some since 1871,
in the face of an active market.
Holding such cotton, he added,
on reserve bank funds. was plain
" specializing. ....
Governor Harding declared farm
ers need have no fear that the
banks would not do their part and
carry over loans on staple crops
for which there is no market, pro-
vided the farmers would make q
fair statement of their conditions
to the bankers He cited figures
which, he said. showed there had
been no restrictions on rediscounts
of agricultural paper.
Secretary Houston, who proceed
ed Governor Harding, strongly OPP
posed projects to revive the war
finance corporation for the pur-
pose of financing sales abroad OF
surplus farm products. Present
price declines were due to readjust-
ments following the war, he said,
and he saw no solution for the
problem, although the treasury
department had devoted more
thought to 1t than to any other
subject for the last two months.
Favors Cattle Growers.
In the course of his testimony
Governor Harding said diversion
of the $70,OO0,0OO profits of the
federal reserve board for loans to
cattle growers would be more eff
fective than if applied to agricul-
ture generally. He had been
asked as to his opinion on the pro-
posal of Senator Hitchcock for en-
ployment of these funds for relief
The situation of the cattle grow
ers, Governor Harding said, stood
by itself and demanded relief. The
suggestion Of Senator Hitchcock,
he continued, was outside the
province of the board and matter
with which it was not concerned.
Governor Harding said that
there was no cause for fear on the
part of the producers that the
banks would not do their part In
the present situation.
Denies PrOfiteering Charge.
Answering the charge of prof