The Colorado statesman., 1921-09-24
BY EDWARD 3. CLARK.

BY EDWARD 3. CLARK.
Wushington.-Sc Seemingly officials of
government directly charged with the
work OF administering the agricultural
relief act. which was passed by con
gress and approved by the President
recently, believe that the legislation
is to bring some of the results which
are desired. Experience alone prob
nbly will determine the outcome, but
the War Finance corporation is plan
ming the work and is expressing CON
fidence in real accomplishment.
Eugene Meyer, Jr., is the managing
director of the War Finance cOrpo-
ration. Ills views on the agricultural
relief act ought to be of interest, for
his organization is charged with the
work of its administration. His Views,
TO be approved. or perhaps combatted.
according 70 the viewpoint. are as fol-
lows:
The agricultural relief act is n
measure of great significance to our
agricultural interests. 1t is very
constructive piece of legislation. and,
I'm my opinion is thoroughly workable
from the administrative point of view.
1t recognizes the new conditions eN-
isting In our International and domes-
tic trade and aims to meet these con
ditions by giving the War Finance
corporation power to assist in tinanc-
ing the carrying of agricultural com
modities until they can be marketed
in an orderly way
The inability and unwillingneSs of
foreign merchants ana manufacturers
to purchase the greater part of their
requirements for the years during the
period Immediately following the har-
vesting of our crops, as they are ac-
customed to do in normal times.
coupled with the failure of our own
merchants and manufacturers to car
ry normal stocks, has brought about
a situation which makes 1t necessary
for us to market our staple agricul-
tural products over II longer period
than usual.
Cotton Situation an Example.
This situation is clearly indicated
in the following extract from report
from an investigator of the Depart
ment of Agriculture. who is now in
American agricultural products
THE cotton merchants over here in
the countries visited do not think it
sound business for American shippers
or banks to advance too much credit
to the cotton mills. They say that
the mills can arrange the necessary
credits with local banks to buy cotton
If only they can show an outlet for
the goods; that extending liberal cred
it from America will tend to increase
the risks assumed by the mill and may
lead to speculative ventures on The
part of the mills.
"The merchants point out that mills
should buy cotton only as they are
able to sell goods protitably and then
that the mill should cover its require
ments with cotton close at hand. They
go so far as 10 say that the merchant
should sell cotton on call for the mill
to fix the price when the goods are
sold. This suggestion seems unsound
TO me. as il involves too great risk
for the seller making him take
chances which rightfully fall on the
manufactures. But Mt any rate the
suggestion that reasonable stocks
should be placed in the leading Euro
pean markets and hedged in dollars,
seems sound.
Exchange Rate lnterferes.
"The price can be fixed when the
sale is consummated and at rate of
exchange which is taken into consid
Grafton when the price is determined.
These merchants point out that they
cannot carry large stocks as in former
years as "A change in the rate of ex-
change might cause serious losses,
and that therefore they must of neces-
sity buy cotton only as it is needed.
IL they follow out this plan ii Will
mean safe business to European mills,
but slow and long drawn-Out cotton
season back in America, and cotton
growers might as well make their
plans to market their crop gradually
ns the demand warrants.
"The pressing need ut the present
time, therefore, is fer additional fa-
cilities to finance our staple agricul-
tural products so that they can be
marketed more gradually than for
merly The agricultural relief act
aims TO provide these facilities along
sound lines, and in way that will
be helpful not only to the producers
themselves, but alse TO the whole
business of the country.
1T should he clearly understood
that the act is an emergency measure,
designed to meet the abnormal cond-
lions now confronting us. Experience
In connection with its administration,
however. should enable us to deter
mine to what extent, if any, addi-