Every evening, Wilmington daily commercial. (Wilmington, Del.) 1878-1928, 1922-12-09
FINANCING THE FARMER

farm credits. They are the Tenrcct- |
Anderson bin. the McFadden-CaDper
hill. the Simmons bill and the Norbeck
bill. All have points CT similarity
and the Anal act doubte~~ viii Be
made up by taking the best features
OF each. They will provide credits for
farmers ranging from nine months n
three yesrs.
Under the existing Farm Lean Act.
which Is the 30-year farm mortgage
facility. the maximum loan r. SO 900.
IL Is planned 10 amend this 20 permit
a farmer 70 obtain S25 900 Il is
hoped 10 get such a bill through by
March I next. That date. each year.
Is one on which many farm mortgages
mature in all parts Of the country and
g IS hoped 20 have the new authori-
Zat!On ready in time 20 permit farm
ers 10 convert their old mortgages into
new with the higher maximum loan.
Under the existing law. 20 obtain
these loans. national farm loan as
sOciations must be formed and no loans
can De made except through them. L
10 felt that where no such associations
have been organized. the farmer is not
adequately taken care Of. Therefore.
law will be proposed providing for
the establishment OF farm loan
agencies which will deal directly with
unorganized farmers and obtain loans
for them on the security Of their
| farms.
The millions which are lent 70 The
farmers are obtained from the sale
| OF bonds known as farm loan bonds
which have a status as quas. govern
ment bonds and are gilt-edged securi-
ties with a ready market. The Fed
eral Land Banks have. in the past.
marketed these through banking syn
dicates. paying commissions for the
service performed. II is planned 20
save this expense by the creation OF
a bond selling organization among the
Federal Land Banks. BY selling their
own bonds they expect % b. able 70
raise money at less expense. this be-
lns later reflected in a smaller in
terest charge 20 the borrowing
farmers.
\ complaint against the Federal
Reserve system has been that mem
Der banks are chiefly located in cities
The small country hanks are not large
enough 70 join. Therefore. even such
credit facilities as are provided by
the system are not available 70 farm
ers deep in the country because their
small local banks are not members
? To remedy this. IL is proposed 70 admit
2 banks with capital as low as SO. 500
h.,vahFr L. l.
E would give them the privilege OF re
2 discounting their paper at Fedora
Reserve Banks. The plan would be Z,
E let the small banks in and. as the,
( become stronger, their capital woul,
e be increas ed.
Another amendment 20 the Fedora
= would limit the interest rates whicl
r Reserve Act proposed is one whic
may be charged by member bank,
The limitation would be fixed b
= l'stating that a member-hank coul
J, charge but per cent more for none
!. than It had TO pay the Federal Reserv
Bank at which Il discounted its pape,
=. Thus. II a member-hank rediscounte
; notes with a Federal Reserve Banl
K paying a rate OF 5 per cent. the mem
| Der bank would be permitted 10 chars
: no more than per cent 20 the farme
S who actually got the money. TIL
: two per cent margin would be N
lprofit Of the member-bank. Their
% will be strong opposition to this b,
e cause the freedom 20 move intere.
Is rates without such obstacles Is r,
n garded as a part OF the regulatiS
l. merit OF the Federal Reserve system
D. AT present national banks haN
l. certain exemptions from taxes levis
n by States. II is proposed TO remoN
them.
Il These are the measures which cor
h stitute the legislative program Of q