The potters herald. [volume] (East Liverpool, Ohio) 1899-1982, 1950-10-26
Merchants WuiI As Credit Rules
Are Sfiffened TO Figh+ lnflofion

Are Sfiffened 10
Washington (LPA) - The gov.
ernment has applied the brakes OF
installment buying again, and GER
tain merchants are screaming
bloody murder. Under the new
rules you'll have to make ever
bigger down payments than were
required when regulations were in
augurated last month. And you'll
have less time to pay.
Less than a month after the very
mild rules were applied, the Fed
eral Reserve Board decided they
weren't having enough effect on
the initiation. People were still buy
ing more things than were being
produced.
Some store-owners, on the other
hand, were complaining that sales
had been cut by the buying rules,
and prices had been forced down
slightly. That's just what the board
was hoping would happen.
Federal Reserve Board Govern
or r. M. Evans said that the board
is feeling its way along, Starting
out with what seems to be moder-
ate restrictions. If these restrict
ions are found to be inadequate,
they will be strengthened accord
ingly. If, later on, they are found
to be more restrictive than is nee
essary, they will be relaxed.
"Our object is to maintain the
flow Of available goods at stable
prices, if possible, without price
fixing or government rationing."
Loudest walls about the new
rules came from auto dealers. The
down payment for autos was left
at one-third of the purchase price,
but payoff time was cut from Il
months to Is. This means that If
you buy a $500 car you must pay
$500 down, and $50 a month. The
dealers say this high monthly pay
ment will drive buyers away.
Down payments on television
sets, radios, refrigerators, stoves,
washing machines, ironers, and
other heavy household appliances
were boosted from 10 to 25 percent.
Payoff time has been cut from l8
to Is months. Furniture and rugs
now require a Is percent down
payment, instead of 10 percent,
and must be paid for in Is months.
The earlier rules applied only to
things costing 500 and up. Now,
anything over $50 is regulated.
Also, loans granted to purchase
regulated articles are under the
same restrictions, and loans grant
ed to purchase unregulated articles
must be paid back in Is months.
Terms on home repairs have been
left unchanged. You still must pay
ten percent down, and you have 80
months to pay off.
At the same time, the Veterans
loosened housing|
credit restrictions for World WAR;
III vets. VA said it would approve
loans up to 10 years if necessary,
to provide payments the veteran
can meet. Reserve Beard restrlc-
tions had cut the payment time tol
% years for veterans on housesl
under $1,000. The vets have alsol
been allowed down payments of
five to ten percent less than those
required from non-veterans.
Board Chairman Thomas McCabel
said that other inflationary forces,
beside installment buying, have
been out of hand. Growing bank
credit has been eXerting a continu-
ed upward pressure on prices, hel
said. His criticism led to specula-
tion that the board might soon
raise reserve requirements forI
member banks, a much-discussed
stop that would freeze $2l2 billion
in bank funds so they could not be
loaned.
Mariner Eccles, a member of
the board, speaking to a convention
Of the Cooperative League in Chic
ago, called for tough program of
fiscal and credit measures" He
also called for direct controls on
scarce materials.