The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1922-06-10


THE greatest menace to the Fed.
eral Reserve System u political.
Shepherd said. There are now IN
Congress some forty bills which
would do anything, from making
stroying absolutely its intent and
purpose. During stress and depres.
sion II seems to be the easy thing to
try q short cut and undertake to
bring about by legislative enactment
that which can be attained only
through individual initiative. enter.
prise and good Judgment. assisted by
the healing element Of time. and poll.
ticians are attempting to use the
Federal Reserve for this purpose.
Recalls Second u. 8. Bank. ,.
THE present agitation recalls the
history Of the second United States
Bank. which, upon the Inauguration
Of President jackson, stood In the
best Of favor, and was doing good
service Jackson Questioned tie con.
stitutionality. bat Congressional in.
vestigating committees found moth.
ing that warranted interference with
the banks operations. The attacks
on the bank included charges Of Off:
cial misconduct and n1isuse>of FUNDS.
The chief witness against II was 4
former director OF the bank, hut ut
that time an insolvent merchant.
This man reminds one OF certain
characters who have appeared dur.
ing the last two or three years, In
that he seemed to 60 on the theory
that II you threw plenty OF mud.
some Of II win stick. Before the com.
rnittee Of inquiry, he not only WAS
unable to substantiate the charges
he had made. but was proved q per.
THESE charges and investigations.
however, unseated public confidence
in the institution. thereby irnpairing
one Of its greatest assets. The bank
became Q political issue and Con.
Eressmen did what they DO today
they responded to what they con.
eeived to be public opinion and re.
fused to recharter the bank.
Since the Inauguration OF the FED.
eral Reserve System, there has not
uation. The officials Of the systeYn
general welfare, and to the best Of
their ability, and they did II a. wen
as II was possible for any set Of hu-
man beings to do. No great eco
nomic change. however, beneficial It
may be to the general community,
can take place without adversely al.
fecting temporarily certain groups or
individuals, but their loss In more
than compensated for in the general
gain. II II true that changes
wrought under the Federal Reserve
have borne more heavily on some
than others. but the benefits have
far outweighed the disadvantages,
and In the long run viii be shared
by All. .
responsible for much unjust criti-
cism hsaped upon the Federal Re-
serve system. The. blame was pass
ed to the Federal Reserve Board by
some bankers who could. neither
make nor extend certain loans and
were not candid ana tactful enough
10 explain why. Some Of them were
not even members Of the system and
could no more rediscount with q
Federal Reserve Bank than with the
Bank OF England. So, consciolsly
or unconsciously. bankers them
selves are more or less Responsible
ir, no small degree for the unscating
Of confidence In the Federal Reserve
eystem. particularly among the
farmers.
Board Falsely Charged.
from the United States Senate.
the last place from which rnisstate-
ments should ernanate, the members
Of the Federal Reserve Board have
been falsely charged with withhold
Ing credit to agriculture. when the
price Of agricultural products suf-
Tered the greatest decline. did the
Federal Reserve banks restrict
credits to agricultufe7 Here are the
facts: In nonagricuitural districts
rediscounts were decreased by 2s
per cent, but In agricultural districts
that we have heard were discrimina-
ted against they were increased no
less than So per cent.
''In the few years that the Federal
Reserve banks have been In operation
they have accomplished moro than
the trainers could possibly have ex-
pected. Although there had been
five panics during the thirty years
previous to the Federal reserve act,
since the system was put In opera
ton the United States went through
the greatest period OF stress that Il
has ever known without q panic or
the semblance Of q panic"
The convention opened this morn.
|ing with an address by John B. Lar.
ner, president OF the District Bank
ere Associat ton, who outlined the
activities Of the association during
tire past year. Recommendation
that the association affiliate with
the Chamber Of Commerce of the
United States were made by Mr.. Lar.
ner. .-...a.. ..,...
motive field In the District Of Co
lufnbia Ia more than sf0,U00, 900
year. c. II. Warrington, president
on the washington Automotive AZ.
ISOLATION. told the bankers Ia an "a.
dress on CLOSER Rslationships he.
tween the Autouiotive Associates
and the District Bankers Associa.
ton"
Time Payment Plan Grows.
The problem OF financing the
aies OF these motor vehicles In the
pptail field 10 one OF very much
larger proportions than. the finaYic.
ing required for the sale OF gny
other types OF commodities whleh
ara sold 10 a., even or lesser extent
upon time payrnsnts. he said.