The Birmingham age-herald., 1921-08-04
Violent Clashes Mark Hearing of Williams Charges Against Policies of Federal Reserve
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 of the audience and demanded a hearing on personal grounds, to deny allegations concerning himself as Mir Williams had made them, and pres ently with Governor Strong pro- duced from the confidential files of reserve offices correspondence and reports to combat MT. Williams criticisms.
 To answer letters and memoranda read by Mir. Williams and to which he said he had sent his associates on the reserve board during 1920 and 1921. protesting their policy and course. Governor Harding demanded and received permission to read a single letter of response which the board made to MT Williams in 1921.
 The federal reserve board feels constrained to say" the letter said, that your action has dem onstrated the futility of discussions with you on questions of honor and fair play.'
 MT Williams criticism of the boards handling of credit problems as contained in the correspondence and repeated to the congressional commission were characterized in Governor Harding's letter as "ignor- ant inaccurate and misleading"
 The object seems to have been merely to make, a record during your tenure of office of statements to be handed to the pubic later" the let ter said sin part, 'as an appeal to prejudices and sympathies and not to reason"
 The Harding letter further said that MT. Williams criticisms were generally trivial or susceptible of no definite constructive interpreta- tion," and added that "a failure to comply with you cannot be said failure to challenge your statements"
 Missed A Meetings
 As to the criticism of lending to New York banks, the Harding letter said that 'out of disordered mass of details and statements" forward ed by MT. Williams, it had been i'm possible for the board to understand what action he desired taken. The letter said also that out of 80 meet ings of the board preceding MT. Will Hams retirement from office he had attended IS during their entire time Is during a part Of the time and dur ing A was absent entirely"
 It was charged also that MT. Will Hams had circulated outside of the board confidential letters upon credit matters and refused to tell the board to what person or persons they had been sent"
 The reading of the letter resulted in a remark from MT. Williams about poison gas" and retorts in which Governor Harding asserted his own desire during all of the preceding con- troversy within the board to settle matters peaceably, but to fight If necessary.
 Governor Strong read extracts from an official confidential report made to the board DIV him on the New York banking system. It referred to Mir. Williams semi-offical reports as Ignorant and misleading" and ac- cused him of violations of proper iety and disloyalty to his associates
 One New York bank, which Mir. Williams said held s1S0.000,000 in fed eral reserve loans Governor Strong declared held also SIP, 000, GOO in gov ernment securities.A adding that "most of it's loans were made to carry pur- chases during the war" While it was lending $1S,000.OO0 directly or indi rectly to it's own officers. Governor Strong said, it held S15,000,000 in Li- berty bonds as collateral and addi- tional securities as we'll.
 Mr. Williams charged that SO per cent interest in New York money markets meant the starving of farm ing districts.
 Had the comptroller understood the working of the reserve system" Governor Strong responded, he would have understood those rates resulted from the constant withdrawal of funds from New York to send to other sections of the country"
 Much of the credit pressure re- suited from organized movements in various parts or the country" MT. Strong continued, Ito withhold com modities from their usual markets.
 "A general denial is hardly an ef- fectual answer to specific charges and complaints" Mir. Williams said when his turn came again. and later he expressed the opinion that the New York bank dealing with reserve funds passed money out with pro- digality'' during periods when bor- rowers elsewhere were being restrict- ed He concluded his two-day discus sion with observations that f'there never had been the currency infla- tion in this country some people be- lieved;" that there was present inn