New-York tribune., 1922-10-03
Acute Farm Crisis Past,
Meyer Assures Bankers
Var Finance Corporation Head
Says Economic improvement
Is Most Rnpid in History

In an address yesterday before the
state bank division Of the American
Bankers Association, Eugene Meyer
jr., managing director Of the War
Finance Corporation. declared that the
acute phases Of the agricultural crisis
of 1920 and 1921 are over.
"The aftermath, in the form Of a
burden OF debt on the farmers of the
United States, still remains" he said,
"and some thousands OF banking in
stitutions in the country districts are
still in an over-extended condition.
But probably ut no time in our history
has there been SO rapid and extensive
an improvement in our economic con-
dition as during the last eighteen
months. The position of the farmer
and stockman Is favorable, and, al
though there were declines recently in
the prices Of some commodities, most
staple farm products are considerably
higher than they were In the summer
and fall of last year"
Continuing on the subject of agri-
cultural financing, Mr.. Meyer said:
THE keynote of our national policy
should be the development Of the use
fulness of the Federal Reserve System
to the maximum. 1t would be aneco-
| nomical and unsound, it would be the
height of folly, to set up other agen-
cies for doing the things the system
can and should do.
"While it is important to safeguard
the Federal Reserve system by proper
restrictions regarding eligible paper,
it is equally important to safeguard
the business of the country by avoid
ing discrimination against paper which
may properly be considered as eligible.
The system gave us banking elasticity
in way that was long necessary,
but it also created difference between
different kinds of good paper. Before
the system was established paper was
judged on its merits. 1t was good or
bad, according to the worth Of the
maker and the security back Of it.
There was no distinction between diff
ferent kinds of good paper. But now
good paper is classified either as good
rediscountable paper or good paper
that is not rediscountable; and bank
ers are considering their loans, even
where they have no intention Of using
them for rediscount purposes, with re-
gard to the requirements of eligibility.
We must not overlook the fact that,
while the system has greatly enhanced
the desirability of eligible paper, it has
COTIeSpoHulNBty ueCIedSeu tHe oco'i
ability of non-eligible paper, even
though that paper may be satisfactory
in every respect from the standpoint
of security"
Mr.. Meyer urged that our national
policy should not only look toward the
further development of the Federal
Reserve System, but that it should
recognize the fundamental Importance
Of welding into q closer and more
harmonious unit the different ele-
ments that go to make up our banking
structure.
1--WE are at a parting of the ways"
he said, "and now is the time for US
to determine the direction in which
we are going. We must decide whether
haphazard deveiopment mt Of % our banking
machinery, or whether our action shall
proceed along lines based upon com
prehensive view of the needs of the
country, bringing our entire banking
| structure and resources into a more
| harmonious and unified organization"