The Chickasha daily express. (Chickasha, Indian Territory [Okla.]) 1899-current, 1921-07-05
LEND FARMERS r. 7.
TWO BILLIONS
Governor Harding Says Reserve
Banks Increased Instead Of
Restricting Loans.
FIGURES REFuTE CHARGES
More Than rwo.and.a.Half Times ~
Much Paper Was Discounted In
Eleven Months Of 1920 as In the
Year i9io-Report to oronna.

Washlngton.-Aiore than two nm,
one-half times as much agriculture
paper was redlscounted by federa
Reserve banks IN the II months dowr
to December I, 1920. as was redls
counted during the entire year OF 1919
according 10 estimates furnished by
Governor Harding OF the federal re.
serve board TO Senator A. ]. Gronna,
chairman OF the scnntc committee on
agriculture. 1he estimates furnlihed
show that farm paper redlscounied
Inst year amounted to almost 5000.
100000. The estimates are: 1920. ST..
oS0,033,0o0; 1919. s120, 100000.
The farmers have been complaining
that Federal Reserve banks dlscrimIn.
inted against them. and lnsiend of
making credits TO the growers more
elastic actually restricted loans.
Treasury officials have consistently
maintained that credits were not re.
sirlcted but We're greatly Increased.
Nevertheless, the farmers have insist.
ed that they have been Disseminated
against. aud ON this contention they
have based their demand for revival
of the War Finance corporation. The
bill reviving the corporation has been
passed by congress.
More Loans Than Are Tabulated.
In his letter TO Senator GrOnna,
Governor Harding ,ntimates that while
his figures nre merely estimates bnscd
on the production and sales Of farm
products, undoubtedly much more
money than Is tabulated was actually
loaned to the farmers. He writes:
I'm compliance with the request
made In your letter OF December ii,
for Information regarding the amount
OF actual agricultural paper rcds-
counted during the years 1919 and
1920 Ito date) based on agricultural
production and sales Of the respective
years, have trr-Aonor to submit here
with copy of tabular statement com
piled from telegraphic data received
from all Federal Reserve banks.
"Section IL of the federal reserve
act provides that notes, drafts and |
bills drawn or issued for agricultural |
purposes or based on live stock hav- |
Ing a maturity of not longer than six |
months, are eligible for rediscount by |
a Federal Reserve bank the limit OF
maturity In all other cases being 80 |
days The Federal Reserve banks re-
discount large amounts Of agricultural
paper which has a maturity not ex-
ceeding 30 days, but such paper is
classified with other paper of like ma
turity.
Therefore, agricultural and live
stock paper, as shown by the Federal
Reserve banks, applies only to paper
having maturity of longer than 90
days. The board receives this nfor-
nation froip day to day and the
amount Of agricultural discount at
each Federal Reserve bank, that Is.
paper having a maturity of from nine
ty days to six months, is published
each month in the Federal Reserve
Bulletin.
THE special figures furnished by
the Federal Reserve banks IN accord
ance with your request are in all cases
estimates, no exact figures of the total
volume of loans for agricultural pur-
poses being available at the Federal
Reserve banks. In fhe first place, most
of the borrowings at Federal Reserve
hnnkc nv fnatphor MI I,ri I,o |
year 1919 and a considerable proper
tion of these borrowings during the
current year have been in the form of
the borrowing banks own notes, Sc
cured by government obligations or by
commercial industrial and agricul-
tural paper 1t is known that member
banks in New York city have made
large loans to their correspondent
banks throughout the country, and it
is reasonable to suppose that part of
the proceeds of such loans have been
applied by the borrowing banks for
agricultural purposes, but it is impos.
slble to state the amount.
Conditions Similar in Other Banks.
"The same is true with respect to
rloaps made by member banks in Chi
cago, ST. Louis Minneapolis, Kansas
City, New Orleans and other financial
centers throughout the country. Non
member State banks lend large sums
In the aggregate for agricultural pur-
poses But as they have no dealings
with the Federal Reserve banks their
loans to farmers are not reflected In
the figures furnished by the Federal
Reserve banks, although it is a fact
that all Federal Reserve banks have
been lending large amount to mem-
Der banks, which have in turn redis-
counted paper for Donmember banks.
ut should be borne in mind also
that the total amount of farmers notes.
rediscounted by Federal Reserve
banks gives no indication of the
advanced by the Federal Re-
serve banks to finance the production
and sale of farm products, since large
advanced to member banks
In other districts on commercial and
Industrial paper are used by these
banks for loans to agricultural inter-
pSts Only the Federal Reserve hanks