Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1920-10-12
SAYS j. s. BANK HAS
ONLY S4,000,0O0 IN
FARM RE-D|SCOUNT
This Figure Compares With
Total of s170,0O0,000 for
Various Other Lines, Dr.
rector Jackson Reports

That the Federal Reserve Bank Of
he Sixth (Atlanta) district is car
ying at the present time only $4,-
100000 of agricultural re-discounts,
Is compared with various other re-
discounts aggregating $170,000,0OO.
vas asserted yesterday by L. B.
Jackson, director of the state bureau
If markets, in a statement issued
Upon his return from Birmingham,
where he appeared Friday before the
directors of the bank of this district
It a meeting held in that city and at
ended by w. p. G. Harding, gov
ernor of the Federal Reserve Board
n Washington.
The object of Mr.. Jackson's trip
% Birmingham was to ask the di-
'ectors for an Interpretation of a
circular issued by the bank last
June, in which the statement was
made that notes. the proceeds of
which have been or are to be used
for strictly farm production. shall be
exempted from the normal or basic
line Of the discounting member bank
10 an amount not exceeding the paid
in and unimpaired capital and sur
plus of such member bank"
Mr.. Jackson's request for an inter
probation of this exemption of agri
cultural paper was taken under con
sideration by the board, and thei
decision was reserved.
What Mr.. Jackson wishes to know
was whether or not a farmers not
secured by warehouse receipt TO
cotton produced this year, and tn
proceeds of which were to be uset
by the farmer to pay obligations in
Cured in the making of a crop, would
be exempt from the normal or basi,
line of the discounting member bank
Point Is Important
This point is considered highly i'm
portant by the market bureau, ant
by the other cotton leaders, for tn,
reason, as they are informed, tina
ing such heavy rediscounts tina
they have passed about the per cen
rate of interest allowed them III
to their basic line, and are there
fore paying the higher rate of in
terest on the sliding. scale. The eff
feet of this, naturally, is either t.
cut down the amount of rediscount
whicha bank can handle, or to run VI
it's interest rate SO high that farm
er cannot afford to pay it.
Governor Harding's Statement
AS the result of Mr.. Jackson
appearance before the board, ant
of Inquiries put to him by other
interested in the cotton situation
who were in Birmingham for tn
purpose of getting light on farm
credits, Governor Harding gave gu
a statement in Birmingham Frida.
night in which he declared:
1.-The idea that has gone broad
cast through the country that thu
federal reserve banks can help tn,
farmer of the south to hold his cot
ton for forty cents by financing thu
cotton crop, or aid the farmers O.
the west to get a high price fol
wheat by rushing reserves to tina
section to bolster up the whea
crop, is entirely erroneous"
Governor Harding then went OIL
to say that the most effective mean:
of help for the southern cotto1
grower was self-help through thu
formation of aneXport corporation t.
open the closed markets of centra
thereby making possible ;
big increase in cotton exports ant
relieving the cotton market as :
whole of an accumulated supply
which is or may be greater than i
can absorb.
In this connection Governor Hard
ing made the statement that there
was. money in the north to finance
such a corporation, but he though
the south should help herself, will
her abundant financial resources, ant
let the north keep its money fol
needs of it's own.
NIr. Jackson's Statement
1t was by way of reply to thl!
statement issued by Governor Hard
ing that the statement of Dlrecto
Jackson, of the market bureau, was
portion of his statement. in which h
asserts that agricultural rediscount
now carried by the Atlanta Fedora
Reserve bank are only drop in tn
bucket compared to its total redlS
counts. is as follows:
perhaps Governor Harding will
tell us why it is that if the NORTH
has so much money, two notherI
corporations are now Dor
rowers from the Sixth Federal Re
serve bank Tin a cotton district IL
4 sum in excess of the entire amount
loaned on cotton. The cotton grow
err will also be interested in learning
that at the present time the Sixth
Fed al Reserve bank Tin a cottor
district) has loans aggregatine
on miscellaneous paper
as against only $4.000.000 on cotton.
The names of the two mercantile
Arms referred to by Mr.. Jackson were
not given out by him. but he indicat
ed that his information came from &
source which he believed to be re-
liable.
An effort was made Saturday t.
obtain statement from officials OF
whether Mr.. Jackson's information
was correct. concerning the amount
Of cotton rediScountS now carried by
the bank. Governor Wellborn ant
Chairman McCord had not yet re
turned from the meeting of the
board in Birmingham. No other of
fetal of the bank cared to be quoted
on the subject.
There was obtained by The Journal
however, the rediscount figures con
tanned in the last statement show.
ing the condition Of the bank, ISSUED
October 1. The different classes Of
rediscounts carried by the bank cy
that date as shown by the statemen'
were as follows:
Agricultural -. ........$ $50, 14$
Commercial and Industrial 97,873,S6:
All others ...............' lZU, OOo,Uol
The term "agriculturaP as giver
aboxe, it is understood, includes al
kinds of agricultural products. such
as cotton, live stock and other prod
ucts which are capable of beins
warehoused and used to, secure notes
Exactly what part of the $1S,4 so, 14S
covers cotton paper could not be
learned.
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