Evening star., 1932-01-23
SECOND FINANCE
| FLOW STARTED BY
PRESIDENTS PEN
Bill Adding S125,M0,W0 to
Capital of Federal Land
Banks Signed.
TWO BILLION MEASURE
WILL GO TO SENATE
Machinery speeded and Democratic
Leaders Are Consulted at
White House.

AAe mouse Doday passed, Without
debate, the $5oo,ooo,ooo appropri-
alton to provide capital for the
Reconstruction Finance Corpora
tion. Since the Senate is IN
adjournment, final congressional ap-
proval cannot be had until Monday.
By the Associated Press.
A second stream of credit designed
to loosen the obstacles to business re-
covery, today came into being.
President Hoover, only few hours
after affirming his name to the recon-
struction finance corporation measure,
which will turn $4,000, 10000 into the
channels of industry, signed a bill to
add $125 100000 to the capital Of Fed
eral Land Banks. In statement, issued
as he signed the Land Bank measure,
he said:
''I am glad to sign the third OF our
reconstruction measures-that providing
additional capital to the Federal Land
Banks.
Benefits Are Foreseen-
"It should (a) reinforce the credit
Of the Federal Land Banks system, and
reinsure investors In land banks bonds;
Cb) best enable the banks to obtain
capital for farmers at reasonable rates;
and (c) above all bring relief and hope
to many borrowers from the banks who
have done their honest best, but, be-
cause of circumstances beyond their
control have been unable temporarily
to make the grade"
The land bank bill sets aside S25,-
900, 900 of the $125, 100000 to be used
in extending the time of mortgage pay
ments by oyerburdened farmers.
Moratorium Bill First.
In referring to the land banks bill
as the third, the President had the
moratorium in mind as the hrst.
Only two things are necessary TO
start the Reconstruction Corporation to
functioning. The $500, 0,000,0 600 capital
must be appropriated and the directorate
must be appointed.
A measure to supply the cspital u
being formulated by the House APP
propriations Committee for immediate
introduction. To this $500, 100000 OF
Federal capital will be added $780,
900 900 of additional funds to be raised
by the corporation, itself, on securities
underwritten by the Federal Govern
ment.
The congressional act which created
the $4,000 100000 Government credit
agency became law last night with q
minimum of ceremony and maximum
Of dicyotPh procids,f Encppr q HfiYaH
his signature. A few hours before Con-
gress had given final approval.
The speed which during one day
transformed the corporation from a
paper proposal awaiting sanction into
living force for business improvement
swung today behind the required appro-
priation of funds and completion of the
directorate.
Confers With Democrats.
The House took up for immediate
passage the $500, ,000,0 900 appropriation.
so 1t could be sent to the Senate for
action Monday. After late night con-
ference with Democratic leaders in Con-
gress, President Hoover prepared nom
nations to fill the seven-man board Of
the corporation.
Charles G.. Dawes already has been
named president and Eugene Meyer,
chairman of the board; Secretary Mel
lon and Paul Bestor, farm loan COM
missioner, are ex-officio members under
the law. There remained to be named
three Democrats, as bipartisan board
Is required. Harvey G. Couch. public
utility man of Pine Bluff. Ark, was
understood to be one of the choices
From the White House conference, 1t
developed the Democratic leaders were
IN full 1,nIoycf q Hiru with Mr. PNnuA~
and the nominations might come today.
Senator Robinson of Arkansas, Speaker
Garner and Senator Glass of Virginia
were those who went over the list OF
possibilities with the Chief Executive.
Upon signing, the President issued
concise statement on the corporations
purpose, paying tribute to the men Of
both parties in Congress who forgot
politics to put the bill through.
Aids Small Banks.
Mr. Hoover emphasized this was not
an aid to big industries or big banks,
but to the great number of smaller
ones The big corporations, he main
tanned, can take care of themselves.
The bill was placed before President
Hoover in his study in the White Houss
at sos pm. yesterday. He signed II
before a minute had elapsed, with two
secretaries as his only witnesses. He
used two pens.
Immediately afterward the following
statement was given out at the White
House offices:
"I have signed the Reconstruction
Finance Corporation act.
ut brings into being a powerful or
ganization with adequate resources, able
to strengthen weaknesses that may de-
velop in our credit. banking and rail-
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