Evening journal., 1920-01-17
THREE VOICES
Editorial from tn Boston News Jour.)

Boston News Jour.)
largely determines the quality Of the si
billions OF currency and governs il
the donna Of our fifty billions Of bank
ing credit.
What the head Of the board sai'
should be translated into plain Enslisl
for the understanding OF the % 10000
patriotic investors in Liberty and Vic
tory bonds and the makers and user
Of credits
For easy reading. we will put II In ;
way Governor Hard ng did not put it.
First. Every nation fights by In
flatiOn.
Second. The United states Treas
ury during the war dominated he
Federal Reserve Board ard prevent
ed its functiOning according to
principle Of sound economies. that
the Government might borrow at
low interest rates. Governor Hard
ing viii not tell you whether his
was honest or dishonest. Let US
call 1t patriotism.)
Third. Governor Harding told his
auditors that a few weeks ago the
United States Treasury notified The
Federal Reserve Board that IL was
now free rld independent TO func-
tlon on a business basis; that the
United States Treasury would make
its final cali on the banks for short
term loans very soon. and there
after would begin reduction OF the
national floating debt with prospect
that no more bond issues and no
more notes save perhaps few hun
dred million for the benefit OF
starving nations.
Fourth The Federal Reserve
Bank win now function as planned.
Although Governor Harding did not
make it fully clear that is what he
might have said II he had been ask
ed. There can be no regulation or
control in the money market with
the Federal Reserve rate below the
open market rate. As in England,
the bank rate must be above the
open market rate for economic safe :
ty. The Board has now made an
advance in its discount rates by a
minimum of 81 OF per cent and a
maximum Of 1 f-2 per cent. An op-
portunty offers without disturbance
or interference to business, the
Board will advance the posted dis
count rate above the open market
rate and initiation in advancing
rates by the Federal Reserve Banks
will be encouraged" This might
mean for a tine the lessen'ng OF the
activities Of the Federal Reserve
Board provided there is, for busi-
ness. enough money or banking
credit outside.
Fifth. 1t is therefore perfectly
clear that the WARNINGS began last
Summer by the Federal Reserve
Board against ulation-whether
in Western lands, Texas oils, or
Southern cottOn-will be continued.
Also there must be the endeavOr to
push the Government bonds out or
ihe banks into investment hands.
The theory in inviting subscriptions
10 Government bonds in place OF
hank loans was that the Government
in war stress might reach forward
ard anticipate investment accumula-
ton
These three voices speaking 10 Boston
II the truth Of capital, the fight against
ipital and for higher rates for capital
: credits are Of far more import than
lie message on the same day from
OK bed In WashngtOn TO the Jack
,nian Democrats which falsely assigned
llritual leadership OF the world TO tn
nited states and declared that the
eace Treaty which the Senate rejected
as "the effort by which the belllg-
ent uations sought to effect the set
amnts for which they had fought
roughout the war
Nobody fought for such a league OF
tons as Mr.. Wilson and General
nuts proposed Nobody fought for
c surrender of the national sover-
n'y Of the United States. Nobody
ught for the internatinal MARKHAM la
~ cOmpsct which IS the Gompers dyna-
te I'm the Peace Treaty. 4:
The war Of the future is the econonl-
The flnancial-struggle just where
olige and Gompers and Harding
iced IL