The Idaho Republican. [volume] (Blackfoot, Idaho) 1904-1932, 1920-12-20

NOT very VIGIL teCotVeQ ana prOD8Dky
because II was not thoroly under.
stood. He explained It In q way that
the banker would understand but
not 80 the laymen comprehended It
What he said about county war
rants, loans and re-discOunts was moi
very well understood and Mr.. Ken
nedy has been criticised considerable
because OF It. When the meeting ad-
journed he made some further ex-
plantations to the crowds that gath
cred around him on the curbing and
they admitted that they had not un-
derstO0d him before. A writer rep
resenting the Republican Office in
terviewed Mr.. Kennedy Saturday
morning and asked him to 60 into
detail, making everything 80 plain
that any and all OF us could under
stand what he was trying to COM
municate to that audience on Fri
day afternoon. \.
Relative to the county warrants
IN, taking the money out Of the coun-
ty when they are paid, an unusual
condition exists ut the present time.
As the county expenditures have
gone up during the high prices the
actual expenditures exceed the es-
timated expenditures or what is
known as the budget that IL made up
In advance. When the money actually
raised by taxes has all been expend-
ed and other expenses or additional
expenses are paid by writing war
rants for which there Is no money
In the treasury at the time, those
warrants according to the old prac-
tice were usually held by local peo-
pie. Banks and men having capital
to invest bought these warrants and
carried them until they were redeem
ed and collected seven per cent, in
terest. 1t was as desirable an in
vestment as loaning money at q
slightly higher rate where there was
more risk involved and more work
involved in attending to the loans
and looking after securities.
But under present conditions To-
cal people are not able to carry these
warrants. The demands on them for
money are so great that they have
sought q market for them wherever
they could and the. result is that
most of them have gone out Of the
county or out Of the state. Mr.. Ken
nedy said that his own bank, the
First National, had sold $4,000
worth of such warrants to bank at
Wallace, Idaho, and that as the taxes
are paid this fall and winter and
these warrants paid of in the Jan
uary disbursement Of money, the
Wallace bank will be entitled to its
$4,000 if there is money to redeem
them. That $4,000 will be taken
out Of Bingham county and kept in
north Idaho and put to use there.
There are always some warrants dis |
tributed among local people ,whoY
draw the money and use it locally
at this time and under these pecu-!
liar circumstances the major portion
of the money will go out of the coun-
ty by reason of the outside capital !
lists holding the warrants.
Mr.. Kennedy was advancing the |
theory that If $4,000 worth of !
lakes went delinquent among peo-
pie who cannot raise the money now,
those who can raise the money but
prefer to loan it to other people, for
use, that $4,000 remain
ng within the county would be avail
lble to loan to farmers in the spring
o buy seed and other things neces-
AIRY foR putting in their crops.
Granting that a farmer cannot put
n a crop unless he can borrow some
money, it is much better for him to I:
OrrOw money and let his taxes be
elinquent or some equivalent delin-
uency exist, plant his crops and
long in June when the crop is grow
1g and Locks good, apply to his To-
al banks for loan thru them from
ne federal reserve bank. Granting
lat the local bank has not the mon
= they will require him to make
financial statement showing that
is assets will justify the loan. They
'rward this financial statement to
lie federal reserve bank, loan him
lie amount they are justified in
aiming on it, he could then pay his
Ixes, his help and other pressing
eeds and go on completing this
OPP which he would not have been
Die to complete unless he Sc
lred loan. Then at har-
st time out of the first sales of
e season or at the time agreed up
following the harvest he repays
the federal reserve bank, the
mount borrowed from them with in
rest at 10 per cent. Part of this
terest goes to the local bank to
y for the work they do in prepar-
ng the financial statements, ex-
mining the property if it needs to
examined, and making out the
pers and keeping the records.
He said he could give the writer
me idea of the amount of work
ere is involved in it, by getting
t somebody's statement and ledger
count on which loan had already
en- made and carried thru to COM
elton. He said these were confiden-
i matters between the bank and
3 customers and that he would take
. case of Forrest Trego, nephew
the writer, as an example. 1t was
average account or a little bet
than an average account perhaps,
d we rang Forrest to see IL 1t
s all right with him to examine
or use it as illustration in the
II we wanted to. He very
idly gave his consent.
RECOT JTTTnN