Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1920-10-02
HOLDING MOVEMENT
Is LAUNCHED HERE
BY COTTON LEADERS
(Continued from Page -

for a speech, and presented his
views in a very forcible way. The
senator said:
ut has cost the farmer consider
ably more than 25 cents a pound to
produce the present crop. 1t would
be manifestly unjust to apply the
process Of deflation to the price of
cotton which has been produced on
a scale of inflated costs. l strongly
urge every farmer to refuse to sell
his cotton for less than a profitable
price. l believe if they will stand
steady for sixty days without losing
their nerve, they will get a profit
able price.
Secretary Houston's recent state
ment in my judgment was untimely
and i'll advised. l do not believe,
however, that he intended to say that
the federal reserve banks would
stop all advances on cotton. L be-
lieVe he meant to say they would
stop only those advances which were
intended for boarding purposes, Ii
were an officer of the federal re-
serve bank. 1 would insist that mon
ey borrowed on cotton warehouse re-
ceiptS must be used to pay debts in
Cured in producing the crop, so that
the monye would quickly get back to
the federal reserve bank and thus
prevent an imitation Of the currency.
Secretary Houston, even if he de-
sired to do so, has no authority to
curtail agricultural credits. His au-
thority is limited to his one vote as
a member of the federal reserve
board in Washington. The policy of
the federal reserve system in re-
gard to agricultural credits is fixed
by law, and cannot be changed by
ii nfs,,H Of = l1 fHrF
Notice to Board
GIN conclusion, 1 believe this meet
ing should courteously but emphati-
cally , advise the federal reserve
board in Washington that the grow
ers of cotton will not dispose of their
and I believe we should advise. our
farmers to hold their cotton and
hold their nerve"
President MattuX, of the Georgia
division of the Cotton association,
read letter from Governor Well
born, of the Atlanta Federal Reserve
bank of Atlanta, addressed to Com
there would be no change in the es-
tablished policy of the bank with
regard to the handling of notes Sc
cured by cotton warehouse receipts
Mr.. MattuX, in connection with this
letter, Informed the meeting that
Governor Wellborn intended to be
present, but was prevented, and had
sent word that he was heartily In
sympathy with the object of the
meeting.
The next speaker was Robert F.
Maddox, president of the Atlanta
National bank and formerly preSi-
dent of the American Bankers as
ISOLATION. Mr.. Maddox in the out
suggestions made by Senator Smith
He emphasized particularly the fact
that very few of the state banks
of Georgia have become members Of
the federal reserve system, and, for
that reason, are not in a position
full benefit of the credit facilities
which they need and which the sys-
tenn could give them, if all banks
were members of it. Mr. Maddox
explained that the Federal Reserve
bank of Atlanta some months ago
established a sliding scale of redis-
count rates which has had the effect
of increasing the cost of money, anl
this increase has prevented the ma
tlonal banks from extending to their
correspondent state banks as grea
a measure of credit as they could
before.
Banker Explains System
Mr.. Maddox gave in detail an eX-
PLANTATION of the fact that a very
large extension of credit caused BY
the war has forced the entire fedora
system very close to it's required go'~
reserve of forty per cent, and this
factor has necessitated a general re
StrictiOn of credits.
81 agree with the other speakers
who have preceded me that 25 cents
a pound is below the cost of pro-
duction," said Mr.. Maddox. II am
glad to see Commissioner Brown
taking such an active stand for a
better price. All of us are dependent
on the prosperity of the farmer for
our own prosperity, regardless of
w at business we are eng9 ged in.
and the present situation demands
that we all pull together. My advice
to the farmer is to put his cotton in
a warehouse. and to give his mer-
chants a note covering his obliga-