Evening journal., 1920-05-19
FEDERAL RESERVE BOOSTS PRICES.


xsFS NORMOUS Increases IN the cost Of necessities
T. through the nnanciDg Of the Federal Reserve have
netd millions 10 the worst form OF prohteers" Repre-
sentative Edward j. King, Of Illinois, declared recently
The charge made before the Rules Committee of the
House IN support OF resolution FOR Congressional in
vesaon of the activities Of the Federal Reserve Board
The sugar shoriage is due almost entirely to the
nnancing Of The hoarer by the Federal Reserve asserts
Representatoive King The Bureau OF Markets today in
farms that April . there 1921 tons of
sugar stocks New York Boston and Philadelphia,
pared With ii099i year ago But with the aid Of
governments working through the Federal Reserve
lhze hoarers OF sugar enabled o keep it on the
market. Withdraw credit and these stocks viii come
hmblns on the market in adequate quantities and at
reasonable prices These sugar stocks are being re-
leased IN just sufficient amounts 10 maintain the short
age and keep the price soaring.
Although wool garments are at prohibitive figures
the supply OF wool March is7iO7ooO pounds com
pared with i7s6g70OO pounds a year ago. As long as
the Federal Reserve viii loan unlimited amounts OF
money 70 the holders OF his wool the wool win be
allowed D litter the muact only in SUFFICIENT quant
ties maintain the price large amount Of raw silk
Is beng hoarded in New York We may soon expect to
have Federal Reserve Bank notes issued asdns this silk
In New York city alone there is held at present
70ti50o0 pounds Of unsod condensed and eyaporaied
milk compared with s06i 600 pounds year ago Fnano-
Is enabling the holders to keep The milk the mar
ket and the price up, although tot stocks the United
cAaAco are ~ ctnA IN excess OF lloSe year
III prices dropped suddenly the Federal Reserve
would be hard hit and Governor Harding knows IT," he
said But II The issuance Of Federal Reserve money is
continued there viii be awful day of reckoning and
thai Is what my resolution would avoid We must siop
financing specuators and hoarers Reserve agents have
urged bankers 10 extend credit in unconscionabe amounts
assuring the bankers hat every demand for money
viii be nled by them. Bankers have in some Instances
regret b learn, loaned money 10 Spectators with IN,
understanding that they 10 have half the profits
for nnancns the deal The volume OF credit has in
creased with only the sky the limit ] have IN mins
one case where national banks purchased goyernmen
certificates OF indebtedness netting approximately Nv
per cent interest from the Federal Reserve bank AM
borrowed the money back al three and oneaf per cent
thus making clear per cent and and more on tn
money which had been loaned only in imagination"
Small Stale hanks accused OF being unpatrlotic
not taking these certificates OF Indebtedness which The
would have TO retain. Federal Reserve banks Will M
accept the notes OF farmers and hence the small ban
has its hands full taking OF is customers IN
Federal Reserve prefers the notes OF pecualors Fea
Of financial chioancry and lugsiery which would hay
shsmed the Imagination OF Baron Munchausen ha,
saken place under The present administration OF tn
Federal Reserve system.