The Washington herald., 1921-06-11
Bankers Will Cooperate
With Government in
Financing.
CREDIT TO STOCK
RAISERS PLANNED
Harding Hopes to Avoid
Special Legislation
For Industry.

tween the administration and the
banking interests of the country
developed in two quarters yester-
day.
Announcement was made that
President Harding has received as
surances from the leading interna-
tionaI bankers that henceforth they
will obtain the governments sane
tion to all foreign financial trans
actions.
A further indication Of a desire
on the part of bankers to assist the
administration was given at con-
ference over the question of finance
ing the pressing needs of the live
stock industry through banking
channels.
Conference Called by Mellon.
The conference was called by Sec
retary Of the Treasury Mellon.
Those present were ]. P. Morgan
of New York city; Benjamin Strong,
governor Of the Federal Reserve
bank of New York: Vice Gov. E. B.
PlaH and John r Mitchell of the
federal reserve board, and Eugene
Mayer. jr.. managing director of the
war finance corporation.
II il proves possible to raise suf-
fcient funds to furnish additionaa
credit facilities for the stock rais-
ing industry the plan proposed oy
the federal reserve board for legis-
lation to make available to the
war hpapce corporation S50,OOO.OOO
to be used in livestock loans Will
be abandoned.
It developed that President Hard
ing Is anxious to avoid, II possible,
special legislation providing finan-
cial assistance to any industry
when the matter can be handle-
by the bankers of the country.
willing to Ask Approval.
The arrangement by which the
international bankers will coop
crate with the government in their
foreign transactions is one of a
voluntary nature entirely. The ad-
ministration does not desire to ex-
erciss control over the situation
through any legal power but it was
stated yesterday that President
Harding feels greatly pleased over
the willingness expressed by the
bankers to seek the informal ap-
proval OF the government before
any further large foreign transac-
tions. such as the recent French
loan negotiated in this country, are
entered into. According to the as
surances given President Harding
the international bankers will aban-
don any plan which the govern
ment may object to.
This understanding between the
administration and the bankers, it
was stated. does not mean that the
government will In any way stand
back Of such foreign loans as may
be negotiated in this country: nor
does il mean that the bankers have
agreed under all circumstances TO
insist that proceeds of loans of this
character be expended in the
United States.
Trusts Bankers Judgment.
As a result Of the representation
by the international bankers that
the United States might benefit
through a roundabout transaction
by which a foreign country used
money obtained from American
bankers for purchase of goods in
another country. which country in
turn bought manufactured goods
from the United States. the admin
iStratiOn is apparently content TO
trust to the best Judgment of the
bankers on this point.
The conference held yesterday at
the instance of Secretary of the
Treasury Mellon relative to form
ing a pool among the banks to
finance the livestock industry did
not develop definitely whether such
a plan is feasible. According to
an announcement made by Secre-
tary Mellon following the confer
ence, "a short investigation will in
dicate whether or not adequate
financial relief for the livestock in
dustry may be obtained through
private banking channels"
stock RaIsers Need Credit.
Although the proposed legisla-
tion would provide $4,000, 900 from
the treasury for livestock loans, It
is Secretary MELONS opinion that
so great an amount may not be
necessary. As a result of yester-
days conference a further canvass
will be made of some of the leading
bankers of the country to determine
just how much money could be
raised without governmental as
sistance.
The special need for additional
credit facilities for the stock-rals-
ing industry is due to the fact that
livestock paper running longer
than six months is not eligible for
rediscount at federal reserve
banks Loans for the purpose of
feeding and fattening cattle are
thus more easily obtained than the
longer-time loans for breeding cat
tie and young calves.
Governor W. p. G. Harding CT the
federal reserve board is now in the