Democratic messenger. [volume] (Snow Hill, Md.) 1869-1973, 1922-10-14
Bankers Told Need
OF Helping Farmers
Head OF War Finance Corporation Points
Out The Necessity Of Extended
Crop Loans To Farmers


the United States are wide awake to
the Importance of working out more
liberal platform for agricultural and
livestock financing. Already prelim-
mary steps have been taken and a
unity of action assured which ex-
perienced economists predict are the
foundation stones to an era OF un-
precedented national prosperity.
Summed up, the American farmer
played stellar role in the annual
convention of the American Bankers
Association, held here this year ard
attended by 10000 of its members.
First, Eugene Meyer, Jr., Managing
Director of the War Finance Corpor-
alton, put the issue squarely up TO
the bankers in his address, "Financ-
ing Agriculture" Then followed the
principal fight of the convention over
the branch bank issue. Here again
agriculture came to the fore, as it
was the small town banker.
Farmers and the stock raisers may
expect to sec these developments.
Longer termed financing which will
permit u gradual marketing of crops.
In other words, loans which can be
rediscounted or extended to permit
holding Of crops until a favorable
market is offered.
A supervision of live stock loan
companies in line with that exercised
over State and National Banks.
Must Market Our Products Slowly
The need for a more gradual mar
keting of agriculture products
through longer termed financing as
presented to the National Bankers
Association by Eugene Meyer, Jr.,
received their closest attention.
"Unquestionably," said Mr.. Meyer,
sit would have been advantageous,
even under pre-war conditions, to
market our products more gradually.
Under present conditions it is more
than a matter of advantage-it is an
absolute necessity.
Paper, based upon the security of
non perishable commodities" Mr..
Meyer states, "should be made eligi-
BILE for redscount for the length of
time necessary to market a seasons
product before the next harvest. The
view seems to prevail in some quar-
ters that paper, in order to be liquid,
must have maturity of sixty to
ninety days. But a sharp distinc-
tion should be drawn between short
time bank paper and the question of
the liquidity of the security that
underles bank paper, long or short.
Longtime paper may be more
liquid as to security than short-time
paper. During the past year it was
clearly shown that commercial paper
depends for its liquidity on the or
derby buying of the manufactured
goods, and that this orderly buying,
in turn, depends largely upon a pur-
chasing power based upon the order
ly marketing of our basic agricul-
tural products"
Crop Loans Most Desirable.
"Indeed, if our late experience es-
tablished any definite differentiation
between the liquidity of commercial
paper and of paper based upon staple
non-perishable agricultural commodi-
ties, properly warehoused, it estab-
lished the fact that the latter is de-
cidedly more liquid under adverse
conditions than the former. At no
time were such commodities so en-
tirely unmarketable as were certain
lines of manufactured products upon
which the so-called liquid commercial
paper was based.
"While it is important" continued
Mr.. Meyer, "to safeguard the Fed
eral Reserve System by proper re-
strictions regarding eligible paper, it
is equally important to safeguard
business and agriculture by avoiding
discrimination against paper which
may properly be considered as eligi-
ble."
Branch Banks Weaken Farm Loans
The strongest point scored by the
state bankers as opposed to the Ma
tional branch bank idea, was the
claim that branch banks, if extended
to small towns and agricultural dis
tricts, would be manned by outsiders
unfamiliar with local conditions, thus
making loans in many instances un-
sound and weakening our whole
financial structure. The Branch
Bank idea was voted down as detri-
mental to the best interests of the
nation.
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