Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-07
HOOVER SUPPORTED
IN PLAN FOR CREDIT
$780, 100000 Corporation to
Supply Cash to Banks
Proposed.
Continued From First Page.)

OF calling a special session OF the Con-
eress. it was said today.
The Presidents proposals, in the
comment of Senators and Representa-
tives who attended the conference to-
day. we're declared not only timely, but
constructive. This was true of the
Democratic comment as we'll as of the
conference last night were helpful. 1t
was declared, in the discussion of the
Presidents plan.
Drops Debt Suggestion.
While the Presidents proposals for
meeting the banking situation in this
country in the present crisis met gen.
eral approval. his declaration that he
intended to discuss with Premier Laval
of France during his approaching visit
to Washington future steps that may
be imperative in connection with inter-
governmental debts if the worldwide
depression continues, brought state
ments to the effect that it would be
wiser to wait and see If any steps were
necessary and whether Europe showed
a disposition to make the best use of
the debt suspension for a single year,
which has already been agreed to under
the leadership of President Hoover.
If the President at any time conSid-
his conference with the legislators last
night approval of his plan to go into
this matter with Premier Laval 1t was
abandoned, and he plans to go ahead
with this matter on his own respon-
sibility. Senator Borah of Idaho, chair
man of the Foreign Relations Commit
tee. and Senator Vandenberg, both IF
the Presidents own party. take the
position that this is not the time to
S1lo fIo1 oteI0 10 Axfay 1eiA
of the debt holiday. and Representative
Garner. was emphatic in his stand on
the matter.
The three legislative proposals for
which early action by Congress is now
urged upon the President are the lib
eralization of the eligibility of banking
assets for rediscount under the Federal
Reserve system: the furnishing of
further capital by the Government 10
the Federal land banks and the set
ting UP of an organization similar to
the War Finance Corporation. If neces-
sary. to reinforce the S500.000.0 900 VOL
untary revolving fund which President
Hoover has proposed to the banks
themselves.
Vandenberg's Statement.
Senator Vandenberg said of the Pres
1dents program to stabilize banking:
and reinsurance to the banking and
credit situation of the country. 1t Is a
challenge to the courage and confidence
of America. There is no more room
for banking suspicion or credit fears in
clear minds The two voluntary move
mentS to mobilize banking resources for
emergency defense will Immediately
create tremendous new balance. The
three legislative proposals contemplate
-, f4I It
eminent support for legitimate credit
values. While they have the approval
of the bipartisan congressional confer
ence only in principle and while the
legislative details remain to be perfected.
yet the fine spirit of cooperation with
which the program is born gives every
citizen right to new confidence and
solid hope The bank and credit sit
uation is absolutely fundamental to all
other problems.
Personally, I have been convinced
for some time and have been urging
that legitimate expansion in the Fed
ersl Reserve rediscount privilege would
largely stabilize our banking and credit
situation and unfreeze the country.
This now is in sight in some acceptable
form and a great deal more. 1t ought
to be the dawn of new day for those
who believe in America.
Should Meet Need.
1.-THE further war debt discussion Is
too nebulous for present comment. I
am opposed to cancellation. although 1
support the one-year moratorium.
But further lenience, except in emer-
gency, which may involve us in reflex
menace, can await the subsequent day
If and when there is sound American
value received for subsequent changes.
The new voluntary banking organi-
cation and the promise of early legis-
Iative supplement should wholly suffice
our contemporary need. But to make
assurance doubly sure, I continue to
favor a special session of Congress to
hasten its official finality.
u also favor new postal savings regu-
lations which will qualify other than
Government bonds as security for these
funds when redeposited in local banks.
Il wish. meanwhile, the New York
Stock exchange voluntarily would give
us a two months trial of a ban on short
sales of securities. We need labora-
tory test of this highly controversial
idea, and we need it now. Voluntary
action is far better than legislation
when the latter can be avoided"
Partisanship Is Absent.
Representative Robert Luce of 7Aassa-
chusettS. member of the House Bank
ing and Currency Committee said:
The all-important result of the con-
ference was the Endorsement of the
Presidents program in the matter of
banking legislation. The conference
developed complete unanimity of resolve
that all the power of the Federal Gov
eminent shall be used to support the
banking structure of the country. With
complete absence of partiSanship, it was
agreed that everything possible to &C
complish by way of legislation in the
way of relieving the credit situation
shall be done as quickly as possible
after Congress convenes.
This should put an end at once to
any fear on the part of those who have
deposits in our banks. It should be
understood that politics play no part in
the work of the banking and currency
committees Of the House and Senate
Its members differ only as judgments
OF financial experience vary. In both
committees the conservative clements
predominant. They have been re-
luctant to make serious changes in the
banking laws.
The present situation, however. dis
closes imperative need for removing
some of the impediments now in the
way of the most effective use of the
credit resources Of the country, and for
one I feel perfectly sure that these
obstacles will be taken out of the way
just as soon as legislative machinery
permits.
Borrowing to Be Easier.
THE changes will chiefly concern
two phases of our banking structure.
To put it in a non-technical way, one
of these changes will make borrowing
on sound securities easier. I am sure,
however, that there will be no going
beyond sound securities.
THE other will make it possible for
the Farm Loan Banks to sell their
bonds and thus get funds to lend to