New-York tribune., 1922-12-12
Baruch Asks Farm Credit
Through Reserve Banks
Urges Regional Institutions TO
Make Loans on Certificates
of Products In Warehouses

CHICAGO, Dee. ii.-Regional insti.
tutlons under control OF the federal
Reserve system, 10 extend credit 70
the farmer, we're advocated to-day Dy
Bernard NJ. Bsrueh, New York hnan.
eler. In an address before tho annual
convention OF the American Farm bu-
reau here to-day. Mr. Barueh said IN
part; -,
known business existing to-day-and
it is a business much like any otther'
Other businesses have been eentrallzed
And concentrated 70 such an extent
chat the farmer finds himself buying
AZ more or less controlled prices from
Great centrally directed industries, ana
selling in an unlimitedly competitive
manner In a market over which ne mas
no control.
Millions Of Good Farmers
"Millions Of good farmers on goood
land and with good crops are aetua,,y
running their business, through no
fault OF their own or the mischanee OF
nature, at a loss that spells rum u
continued. -,
"Being asked 10 suggest remedy,
a seems 10 me that the proper theory
for correction should be based prinaIl-
iv upon the fact that without regular
aeess. "a eommensurate financing, mod
ern business, with its highly special
ized production and distribution, would
be impossible. Agriculture needs IKE
facilities In order 20 be placed upon
an eouality with all tho other indus
tries with which II has 20 deal.
"A new finance system should be set
nm 10 increase the volume OF three
classes Of rural credits; % Credit for
the more orderly marketing Of crops.
(2) Credit for IN, purpose Of raising
and marketing cattle. (3) Credit for
productive purposes.
"The basis Of increased credits Tor
farmers should be the placing Of the
products in a modern warehouse or
elevator where a neutral authority
would register their grade and amount
ard where n certificate would be issued
for the amount so stored or ware
housed.
Lowest Interest Rate
"The farmer, once in possession Of
this certificate with his product well
protected and insured in the warehouse
and properly graded, could take II 20
the present banking system and OBJ
tain credit upon II In much the same
way as is now done; or TO n new finance
corporation which should be created
for the purpose Of lending money to
! the farmer, at the lowest obtainable
rate Of interest, for not exceeding one
year, upon his note secured by this
certificate representing marketable
commodities. The new institution, in
tended 10 be independent Of the pres
ent banking system, would place the
/ farmers note, secured by his products,
In It's treasury and issue its own OBJ
| legations, as is now done by the Fed
eral Land banks in the field. The
paper 80 Issued should be discount
able In the Federal Reserve System
when there is not more than nine
months TO maturity.
"The regional institutions would be
controlled by n central organization
under Federal authority. Each should
be allowed TO issue and sell its obliga-
tions in the open market % the ex-
/ tent Of ten times its capital.
"The initial capital Of the new sys-
TEN could be obtained out Of the liqui-
dation Of the War Finance Corpora
tion
"Tho country should be divided into
regions for the establishment Of the
regional loan institutions, somewhat
on the basis OF the Federal Land Banks
and the Federal Reserve system. There
are a number Of bills before Congress
aiming in this general direction, which
II should be easily possible 10 COM
bine 10 realize in one measure the
fundamentals of the system here PRO
posed.
81 affirm that there Is nothing in the