The dispatch-news. [volume] (Lexington, S.C.) 1919-2001, 1922-05-03
LIMITATION OF RESERVE BANKS.


LIMITATION OF RESERVE BANKS.
Recently Governor w. P. C. Harding of the Federal
Reserve Board the following significant statement to
the public relative to loans for farmers
"The Federal Reserve Banks are by law forbidden
to lend money for purposes of speculation no matter
what the security length of time. Holding crops
for better prices is speculation matter what the
security length of time. Holding crops for better
prices is specializing the same as holding stocks and
bonds or real estate for better prices
I'm fact there is nothing to speculation except hold
ing for higher price. Reserve banks permitted
to redscount agricultural paper with maturity of six
months less, provided the purpose of the loan to
plant cultivate, harvest market crops breed,
fatten or market cattle. But if the money is wanted
for the purpose of holding crops off the market after
they are harvested to hold cattle off the market
for the purpose Of increasing prices, then re-
serve banks are not permitted to redlscount the
notes"
According to this Interpretation Of the Federal Re-
Act farmer redscoun of his loan from
bank for six months which to plant and cultivate his
crops and then loan the products for period
of months in which to market them This that
twelve months is the full limitation for supplying farmers
with loans produce and market the crop and that the
whole business must be cleared within that period as no
renewals of loans will be permitted under any consdera-
ton The question of the slow and orderly marketing OF
cotton other staple farm products to regulate the
supply meet the needs of legitimate consumption not
only dsregarded but is held that such procedure moth
ing short of speculation.
Indeed Governor Harding takes the position that the
holding of farm products off the market by farmers at
time and under any conditions character of speculation
which the Federal Reserve System will neither condone
permit far redscounts of farmers paper
cerned This rule to be strictly enforced against all
member banks of the System from Farmers
already reporting that banks from which they have bor
rowed money with cotton collateral security have recent
notified them that such notes must be paid when due
the cotton will be forced the market This arbitrary
rule does not appear to be enforced against other line
of business not against dealers cotton after the
staple leaves the hands of the farmers 1t that the
farmers have been made the goats of deflaon in the be-
ginning of that debace of wreck and ruin the nation and
not relieved in way, will force the farmers into
system of slavery to capitastc domination
than the negro slavery of antebelum days. If the farm
products of the Nation to be dumped the market
fast harvested that the producers will always
be penalzed with low prices, which the penalty of
violating the legitimate laws of supply and demand Far
meet the rules laid down by Governor Hard
ing and they must have created for them system of agr
cultural credits which will be totally divorced from the
present methods employed by commercial banking
The quicker Congress the relief of American
rcuure in regard to this vitality important matter Of ag
cultural finance the better it will be for the farmers and
the welfare of the entire country
THE EIGHT HOUR DAY.
The eight hour work day has been generally adopted