596 IOWA DEPARTMENT OF AGRICULTURE 



War. However, on one section of the bill we failed ignominiously, and 

 that is in regard to Section 6. 



I don't know, I may be violating the sanctities of the occasion by 

 mentioning that, but I will speak of it briefly. I think this is one of the 

 finest examples of the effect of organization that I have witnessed in 

 recent years, in support of their contention under Section 6. 



Section 6 is unspeakably the result of a masterly organization and 

 propaganda carried out thruout this country to a successful conclusion. 



Day before yesterday I picked up the Chicago Tribune, and in there, 

 in the financial columns, I read a statement about the Federal Reserve 

 Board issuing some bulletins to the public, or to member banks, that 

 aroused my interest. This is going to be connected up in just a few 

 minutes, if you do not see the connection now. 



"The seventh federal reserve district is largely agricultural, and, 

 while Iowa Is at the moment under a greater strain than other states, 

 basic conditions are largely the same in all sections," the letter states. 

 "Rediscount carried by the reserve bank for member banks must be re- 

 paid promptly. The law obligates the federal reserve bank to be pre- 

 pared to grant re-discount equitably to each and every other member 

 bank." 



Now, just a moment! I want to give the authority for this state- 

 ment first. 



"A plea, but at the same time a veiled demand that farmers and 

 country banks in the middle-west agricultural sections liquidate their 

 loans was sent out yesterday by the Chicago Federal Reserve Bank to 

 the banks in the seventh federal reserve district. The letter stated that 

 complete liquidation is not sought, but only an immediate beginning." 



Now I will proceed further: 



"The reserve bank may grant and has willingly granted to some in- 

 stitutions in certain localities, but no institution or locality so favored 

 should assume that, once granted, these extraordinary accommodations 

 may be carried indefinitely, dependent for their liquidation solely upon 

 the pleasure of the original borrower. The payment of deposits and the 

 granting of seasonal demands yet to come are dependent upon the liquida- 

 tion or reduction of loans now held by banks. 



"To urge complete liquidation immediately is as unwise as it is im- 

 possible, but a beginning of the process at once is imperative, and upon 

 its gradual and orderly continuance is dependent the future welfare of the 

 banker, the depositor, the merchant and the farmer alike. 



"At the banker-farmer conference held in Iowa during November, 

 the opinion was frequently expressed that the farmer alone is feeling the 

 force of the after-war readjustment now in process. Conditions in other 

 lines of business indicate that this opinion is not well founded. It must 

 by this time be evident to all fair observers that the readjustment process 

 is in evidence in practically all lines of commerce and industry, and the 

 balance sheets of January 1st will undoubtedly be convincing proof of 

 this fact." 



Now, let's see about that. I think that you are conscious how your 

 balance sheet is liable to look on January 1st. (Laughter). I don't need 

 to dwell on that phase of it. It says "the readjustment process is in 



