The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1923-03-27
JOHN R. MITCHELL, MEMBER
0FRESERYE BOARD EXPLAINS
FUNCTIONS OF FEDERAL SYSTEM

John r. Mitchell, Washington, APP
pearing not as representative OF
the Federal Reserve board, but as
"A private citizen interested in aid
ing the farmers and business men
to solve their problems gave clear
cxposit on of the federal system
Some advice upon how the farmer
= can better mis- condition was offered
indicating an intimate knowledge of
conditions over the spring wheat
area. His speech follows in part
ut is great pleasure to meet
with you farmers, bankers and
business men of the Northwest
gathered together here today for
the purpose of assisting in pro-
gram for restoring agriculture to
proper relative position IN the
economic operations OF our coun-
try. | say assisting because |
know our desires cannot be COM
pletely accomplished at one meet
ing, but every effort made along
sound constructive lines will aid
greatly in ultimately bringing
about full restoration of agri-
culture.
"Whle | am member of the
Federal Reserve Board, | want to
make plain the fact that | am
speaking more on my own inltla-
tive than in my official capacity.
| am not here representing the
Board but | am here upon the in
vitation of Mr.. John H. Rich
chairman of the Federal Reserve
Bank of Minneapolis, to join in the
conferences which are to be held
i'm several of the larger cities n
the Ninth Federal Reserve district
II am by no means a stranger II
this section of the country; while
was not born here, | feel thai
this great Northwest is my coun
try about as much as it is yours
was first in this section of thu
Northwest in 1889, thirty-fou1
years ago, and was engaged II
banking in Minnesota about twent.
FIVE years prior to taking up Fed
cral Reserve work in Washington
two years ago. Consequently
am reasonably familiar with you
problems and | fully realize tina
out it's weak spots
Some of the objects of the ac
he said were:
Before discussing the agricul
tural situation, it has been suggest
ed that ! briefly discuss the recent
.ly enacted agricultural credits law
This is a big undertaking as tn
act is quite complex and only eS
perience in\its operation Will lro
cut it's weak spots.
"To make loans or advances d
rect to any cooperative associa
ton organized under the laws c
any state and composed Of pei
sons employed in producing, {
producing and marketing, slap
agricultural products, or live stoc]
if the notes or other such oblig;
tions are secured by warehouse r.
ceipts, or shipping documents co
ering such products, or mortgage
on live stock.
Loans cannot exceed IS per Gel
of market values of security.
Loans, advances and discoun
made under this section shall ha'
a maturity not less than S
months, nor more than three year
Rates of interest or discou
shall be subject to approval a
Federal Farm Loan Board.
Federal intermediate Cred
banks shall have power to iss'
debentures running not more tn;
five years, secured by like amou
of notes or other obligations di
counted or purchased.
"Total limit of debentures is t
times amount of paid up capt.
and surplus of each bank.
"No organization entitled to t
privileges of discounting sha
without the approval of\the .Fe
erat Farm Loan Board, be allow
to discount with an lntermedia
Credit bank any note upon viii
the original horl bwer hes be
charged a rate of interest mo
than 1ls per cent greater than t
discount rate of the Federal
IeIl0GUldLc SICuiI e$o eAAS S'A
such loan was made,
Capital of each Federal Int
mediate Credit bank shall be $
OOO, 900 and shall be subscribed
the government of the Unit
States. One half of net earnin
go to the government and balar
to a surplus fund until it sh
amount to 100 per centum Of 81
scribed capital, after which time
per centum of such earnings sh
be paid into surplus and balar
paid to the United. States as
franchise tax. Each Federal
termediate Credit bank is liable
the obligations Of the other Fede1
intermediate Credit banks to t
same extent that the Federal Fal