Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-08
BIGGEST FINANCIAL.
CUSHION PLANNED
Bank Pool and Corporation
to Aid All Factors in
u. S. Industry.
Continued From First Page,

Continued From FIRST Page.)
country" would make 1t possible to do
again or to be ready to do practically
the same things that carried the United
States through previous national
emergency.
The new finance corporation, II pat
termed on the old structure as now
seems likely, would be authorized to
make loans for periods not exceeding
hVe years" to any bank. banker or
trust company in the United states
which has outstanding loans to per-
sons, firms, corporations or aSsocia-
tons. the advances Of the corporation
not TO exceed IS per cent Of the face
value of such loan or loans"
Other Enterprises to Benefit.
Authority was also granted the cor
poratlon to make advances to savings
banks. to building and lean sSsocia tionS
and III fact, to any legitimate enter
prise provided about three fourths Of
the total amount was properly secured.
One OF the biggest single powers
mad 10 do with the promotion Of COM
merce with foreign nations. Advances
for period not to exceed five years
were authorized to any person, firm,
corporation or association engaged In
the business In the United States Of
exporting domestic products. provided
they were unable to obtain funds upon
reasonable terms through banking chan.
nels. such advances to be made only TO
assist In the expectation OF such prod
ucts and limited in amount to not
more than the contract price therefor,
including Insurance. and other charges
to destination"
AnV hank honkar ~ oar.
psny which made advances TO any
such person, Arm. corporation or as
ISOLATION for the purpose OF assisting in
the expectation OF such products" we're
to be given loans.
Sweeping Farm Aid Powers.
Sweeping powers to aid agriculture
were granted, many of which now exist.
OF course, through the Federal Farm
Board.
All advances by the War Finance
Corporation had to be adequately Sc
cured by Endorsement or pledge or
guarantee. and no funds were granted
unless 1t was conclusively proved that
credit could not be obtained in the
ordinary channels
There is no doubt that the corpora
ton now proposed would be able TO
buy and sell Government securities, and
the cooperation Of the Federal Reserve
banks in many transactions would be
given to facilitate the corporations
business.
Briefly. the new Finance Corporation
would function only during the depres-
sion, and would liquidate itself as soon
/ as credit conditions became normal, 80
that there would be no criticism Of
more Government in business"
Designed purely as q cushion against
the destructive influences of the rumor
monger and the pessimiSt. the vast
powers of the proposed corporation may
happily prove SuperfiuouS, but their
significance lies in the fact that the
Government Of the United States stands
ready to supplement the bankers pool
with a finance corporation that would
be ready to do any and all things 10
prevent damage to the credit structure
Of America.
Relying ON Pool.
Meanwhile until the new finance cor
poration Is authorized by Congress. the
reliance of the Government will be on
the banking pool which probably will
be oversubScribed and ready to function
in couple weeks.
President Hoover is tackling the real
estate finance question in the hope OF
somehow developing a program for the
Improvement OF the status of real estate
securities and for the stimulating OF
home construction. His conferences
Wednesday with real estate leaders and
tinanciers will be followed by further
sessions in about 10 days
From an atmosphere OF watchful wait
ing and tense anxiety as to what was
the best move TO make, the administra-
ton has dramatically decided to take
whatever action may be necessary to
utilize the vast financial reserves and
resources OF the country in building an
irresistible wall of public confidence.
Copyright, 1870