South Bend news-times. (South Bend, Ind.) 1913-1938, 1921-08-04
SAYS HARDING
FAVORS BANKS
IN new YORK
]. 5. Williams, Former Comp
noller of Currency, Tesu-
flies Before Congress.
CHARGE IS ANSWERED
Governor of Board Brands
Claims as Ignorant, Inaccu,
rate and Misleading.

WASHINGTON. Aug. S.-Crittctrn
OF federal reserve system credit
policies which was continued We'd
nesday before a congressional com
mission by John Shelton williams.
former comptroller of the currency.
aroused resentment on the part or
the systems two highest officers.
Gov. Harding OF the reserve board.
and Gov. Strong. OF the New York
reserve bank. The report which &c
cused Williams OF false ana raislead-
Ing statements wes interrupted hy
the former comptroIler. WHO
shouted:
That statement OF yours q false. -"
Gov. Strong. however. continued
reading. and presently referred 20
Mr.. Williams as being Jealous OF
his prerogatives."
And that's lie too the latter
INTERCEPTED.
AT this point, I request the com
mittee to require the comptroller 70
make oath whether he has stated
I the whole truth or not" Gov. Strong
exclaimed.
Issues Ruling.
Chairman Anderson ruled amid
the confusion that Il was mot feas-
ibie 10 adopt the policy at this stage
OF the game"
Both federal reserve officials with
number Of associates had sat APP
parently unmoved during two days
along with an audience which nuu.-
J bered many senators and represen-
tatives allied with the agricultural
/ bloc" in congress. while Mr.. Wll-
liams elaborated three general
charges.
He said first that the board had
countenanced undue lendings 20 z
/ New York. banking group during the
1 last two years, for speculative uses.
while forcing liquidation in southern
and western agricultural districts
and that Il had allowed extort.ora-e
/ interest charges and generally failed
TO ease down" Imitation.
/ Gov. Harding Wedne day rose out
/ OF the audience and demanded
| hearing on personal grounds. 20 deny
allegations concerning himself. as
j Mr.. Williams had made them. and
! presently with Gov. Strong. produced
J from the confidential files Of reserve
! officers correspondence and reports
! 10 combat Mr.. Williams criticisms
/ Take TWO
Reads Memorandum.
! To answer letters and rnemoran-
dums read by Mr.. williams and
which he said ne had sent 20 his
/ associates on the reserve board dur
ing 1920 and 1921. protesting their
/ policy and course Gov. Harding de-
manded and received permission 20
read a single letter OF response
which the board made 20 3Ir. VII
liams in 1921.
'SThe federal reserve board feels
| constrained 70 say" the letter said.
that your action has demonstrated
the futility Of discussions with YOU
on questions OF honor or fair play"
Mr.. Williams criticisms Of the
boards handling Of credit problems
as contained in the correspondence
and repeated 10 the congressional
commission were characterized IN
Gov. Harding's letter as ignorant.
/ Inaccurate and misleading"
The object seems 10 have been
merely 70 make a record during your
tenure Of office Of statements % be
handled 20 the public later" the let
ter said In part, "as an appeal %
prejudlces and sympathies and not
to reason"
Criticisms Trivial.
The Harding letter further said
that Mr.. williams criticisms gener-
ally were trivial prevalent or sls-
pectible 70 no definite constructive
Interpretation" and added hat "a
failure 70 comply with you cannot
b said a failure to challenge your
statements"
As 70 the criticism of lending 20
I New York banks the Harding letter
said that out q ga disordered mass
Of details and statements. forwarded
BY Mr.. Williams. 10 had been ".u-
possible for the board 90 understand
what action" he desired taken. The
letter said also that out 90 eighty
meetings Of the board preceding lIr.
Williams retirement from Office be
rad attended eighteen d-ring their
entire time. eighteen during a par-
OF the time and during "a was alb
sent entirely
Il was charged alec thar Williams
had circulated outside 81 the board
, confidential letters upon credit mat
? tiers. and refused % tel the board %
what person or persons they hal
= been sent"
The reading OF tho letter resulted
IN remark t-om AIr. Williams
, about poison gas" and re-roirs in
, which Gov. Harding asserted his
own desire during all OF the preced-
? ing controversy within the board %
settle matter reaceably. but % hght
Il Necessary.
? Reads Extracts.
Gov. Strong read extracts from an
official confidential report made 20
/, the board by him on the New York
banking system. Il referred 20 Mr.
Williams semi-official reports as
ignorant and misleading and ac-
J cused him OF violations Of properly
, and dis'oyalty % his associates"
, One New York bank. which ~