The producers news., 1921-11-25
BANKS OF TWIN
CITIES GETTING
BULK OF LOANS
Country Bankers Use War Finance
Money to Pay Their Debts.

Money TO ray Their Debts.
Minneapolis, Mimi, Nov. 18.-
lSpecial)-The large financial insti-
tutlons of the twin cities-not the
farmers. and country banks Of the
northwest-are the beneficialies of
the act creating the War Finance
corporation, was the assertion made
today by Spurgeon Odell, 839 Metro
politan bank building, Minnesota rep
resentative of the Bank of North Da-
kota. Mr.. Odell contends that very
little money loaned the country banks
of the northwest will ever reach the
farmer. He also expressed it as his
opinion that only a small portion of
the loans made will be retained by
the country bank to strengthen their
reserve. On the other hand, he stated
that more than Is per cent Of all the
money loaned to country banks will
find its way tc either the Federal
Reserve bank cf the Ninth district or
to the Minneapolis and st. Paul
banks.
Just Fooling the Farmer
The legislation was never intend
ed to help the farmer and this was
pointed out by Senator La Toilette
when the bill was up for considera-
ton in the senate" said Mr.. Odell.
He added that the whole plan is a
farce" and stfraud" and was passed
by congress to make the farmer be-
lieve that the administration was
helping him.
I Here is the way it works. = he said
and at some length he outlined the
method used by relating the expert
ence Of bank just west Of Mime
apols which was recently granted a
loan by the War Finance corpora
tion. The loan was for less than
$4,000 and Mr.. Odell states that not
one penny of this will be loaned out
to farmers in that district on new
loans nor will this bank be permitted
to keep any portion for its reserves.
The entire loan was turned over to
the Minneapolis correspondent bank
in liquidation of it's debt with that
institution" said Mr.. Odell. This
bank was loaded down with what
might be termed frozen agricultural
and livestock paper. Foreclosure
would not have brought Is cents on
the dollar and the bank would have
wrecked itself to have attempted to
force collections. So it took this
frozen paper to the War Finance
corporation and secured loan suf-
| ficient to pay off its Minneapolis cor
respondent bank. The Minneapolis
bank was thus benefited while the
only aid obtained for the farmer was
the extension Of further credit. Not
one penny of this went for new loans.
Banks Chief Benefciaries
| .I am not charging that the Min
neapolis and st. Paul banks secure
money direct from the War Finance
corporation but | do say that they
will receive the principal benefit from
the act which is supposed to help the
| farmers. / am also willing to ad-
| nit that in some sections where the
| local banks are not in debt to the
| Minneapolis banks that some benefit
| will be obtained for the farmers, but
there are few such communities In
! the northwest"
/ M. O. Gransgaard, secretary Of the
War Finance corporation for the
northwest district, stated that the
disposition the country banks made
Of he money secured thru the War
Finance corporation depended en-
tirely upon the local banker he
| may us the entire amount to pay
! off his correspondent bank, or he may
use a portion for that purpose, re-
tain some for reserve fund or may
| loan it to farmers on new agricultur-
al or livestock security" said Mr.
Grangaard We simply have. n nc
strings TO the money whatev% The
| disposition of such money varies with
the particular conditions of the banks
and the judgment of the individual
banker he added and added thai
! "Wlenever adequate security IS fur
nished we make a loan id accord
/ ance with the law which provides
that advances can only be made OF
agricultural and livestock security"
4 prominent Minneapolis banker
! who declined to be quoted stated tina
! the country banks have SO far fallet
| to liuuidate their Indebtedness to tht
! Minneapolis banks to any great ex
I tent. He explained that not mor'
4 than 100000 in actual moey has s.
far been loaned to northwest bank
ers by the War Finance corporation.
/ THREE MEN GET BIG
SUM IN BANK ROBBER1
II M