Evening star. [volume] (Washington, D.C.) 1854-1972, 1948-07-30
Snyder
Continued From First Page.)

The measure would make it more
difficult for banks to lend money, a
move to halt the imitation spiral
In a question-and-ansWer period
frequently punctuated with sharp
interchanges with Republican Sen
ators, Secretary Snyder said he ap-
proves the Presidents price control
proposals as emergency measures
only. He said he generally does not
favor such controls "but neither am
! in favor of castor Oil 4.,.,
Senator Flanders, Republican, of
Vermont then asked the Secretary
if he favors castor oil for chronic
constipation the Senator's de-
scription of the long-term imitation
problem, .eE -
Mr.. Snyder replied that such tenn
perafy measures as price control
would give time to study means of
meeting ting long-range problem.
Eccles Hit Snyder.
At yesterdays hearing before the
committee, Mr.. Eccles testified that
Mr., Snyder was responsible for hay
ing removed from the President S
message to Congress last November
a Federal Reserve Board proposal
to raise reserves required of banks
on deposits. Mr.. Eccles said it is
now too late to control initiation but
that its effect may still be softened
IN the bust he said he expects
will come.
MI, Eccles was deposed as chair
man of the Federal Reserve Board
by President Truman after his dis
pute with Secretary Snyder. He
still is member of the board.
In a prepared statement read to
the committee today, Secretary
Snyder said passage of the Presl-
dents eight point anti imitation
program, would strike a major
blow against imitation"
He specifically Endorsed the Ad-
ministration proposal to grant the
Reserve Board new auth ,rity 10 in
crease reserve requirements ana
thus take money out of circulation.
Mr. Eccles and Thomas B. McCabe,
who succeeded Mr. Eccles as Re-
serve Board Chairman, both in
dersed the proposal yesterday.
Mr.. Snyder told the Senators
that expansion of hank credit as
far as agricultural industrial and
commercial loans are concerned
has not contributed to the in
fiation. Such loans, he said, have
actually gone down since last No.
Vember
But the increase of S1,75O,O00, 900
in consumer credit since last No.
vember l, when the one-third down
payment regulation, ended, has con-
tributed to imitation as have housing
loans Mr.. Snyder said, adding that
total consumer credit reached an
all-time peak of $4,000, 600 900 in
May.
Sees Prices Bid Up.
In lndorsing the point in Mr.
Truman's program calling for re-
neWal of consumer credit controls
on purchases of such items as auto
mohiels, stoves and refrigerators,
the Treasury chief said the addi-
tional purchasing power provided
by permitting the public to buy such
goods with only few dollars down
payment can be used only to bid
up prices of consumers goods"
The relevent question now is not
how much consumer credit the
country can bear but how little it
can do with" he said.
Mr., Truman was asked at his
news conference yesterday why he
included the credit controls in his
message to this special session after
not having done so last November.
He replied that conditions had
changed.
Would Cut Expansion.
The administration bill provides
that the Federal Reserve Board may
raise member bank reserve require
ments by 10 per cent on demand
deposits and by per cent on time
deposits. These moves would have
the effect OF cutting down the
amount of money the banks could
lend and thus would have def1a-
tionary effect.
Mr., Eccles said yesterday, how
eyer. that such plan should apply
IN all banks, not Just Reserve Sys-
tenn banks, because of the COMPETE
rive situation between reserve and
non-reserve banks.
Mr. Eceles' testimony Yesterday
included statement that Congress
would not escape its share OF re-
: sponsibility aSr failure to give the