Perth Amboy evening news., 1922-06-07

be a national calamity to permit
the stockmen to kill their immature
stock for lack of financing.
Immediately after the Armistice
there was a general belief that the
exports from the United States,
which had reached a high tide dur
ing the war, would drop away to
practically nothing. This was re-
garded as an undesirable develop
ment, so steps were taken to slim
ulate exports. The belief vas that
if American exporters could extend
credit to foreign buyers, the for
eigners would take American goods
in substantial quantities. 1t vas ar
ranged that the American exporter,
upon granting credit to the for
eigner, could then borrow of the
War Finance Corporation which
would await payment from abroad.
Affairs developed so that the
corporation did very little of this
sort of business. A wrong guess had
been made. Instead of a need ex-
listing for the stimulation of exports
they sprang of their W accord
to previously undreamed of proper
lions. Much credit actually was
given, but it was worked or bank
ers' acceptances through the Fed
eral Reserve banks in a name
which did not require the good Of
fees of the War Finance Corpora
ton. But that is another story,
which, if followed, would open a
discussion of the whole postwar
boom and the subsequent price re-
cession. At any rate. little export
financing was lone by the corpora
- -- ,t. ,.v-- laS&1 ax-A fhnrn
was no more of war aid financing
to be done. The business of the
corporation sagged.
In fact in May, 1920, the Board
of Directors of the Corporation, of
which Secretary of the Treasury
Houston then was chairman. adopt
ed a resolution ~suspending activities.
No new loans were made; the cor
poration's offices merely collected
payments on the loans outstanding.
That summer came tine heavy fall
in prices, particularly in prices of
farm products. In the autumn an
agitation was started to revive the
War Finance Corporation to help
the farmers because people had
achieved the habit of thinking this
great government bank could be
turned to almost any purpose. There
were many who opposed the revival,
declaring hat it was time the gov
eminent got out of business.
After a spirited contest, the cor
poration was revived by congress
sionaI action, and proceeded TO
make loans to stimulate exports.
1t had been urged hat if exports OF
farm products could be stimulated.
prices of these goods would rise and
the American farmer would be re-
lieved.
Then in August, 1921. the cor
poration's organic act again was
amended to permit it to make ad-
vances on agricultural products,
whether or not they were for ex-
port. The corporation created an
elaborate system of committees
ramlfying the entire country. Each
committee was, in effect. a local
agent for the great government
hank at Washington. A farmer.
needing credit, would borrow from
his local bank. The local bank
would turn the note over 10 the
committee which would forward 1t
70 W%ashinton TO the corporation.
The corporation would advance
money against it. OF course. not ev-
cry note made by a farmer woulu
fit the requirements of the law ana
regulations. The farmer actually
got his money from mis- local bank.
but 1t, in many cases, would not
| lend II it did not know it could pass
the note on to the COOPERATION. In
this way a large sum of none has
been advanced to relieve the farm
ers during the last ten months.
Railroad Securities Purchased
Another use the corporation
made of its funds "a to purchase
through the Director General OF
Railroads, securities of American
railroads which had been pledged
with the Director General on &C
count of additions and betterments
made by the government during
Federal control. When 1t appeared
that the railroads were in dire need
Of funds. following their return 10
their owners, the War Finance Cor
~poration arranged to sell ecurl-
ties to public, thus raising funds
10 advance to the railroads.
A brief summary will show now
much money this great government
bank has advanced 10 different
groups of the American people:
) Advances made to May Is to finance