AUKICULTUllAL Al'l'Koi'UIATKiN BIIJ., 1^2*. 4jl 



At this point tlu' cominittt'(> iDclu'lfMl some fijftiR's Hhowiii^ llu* 

 profjross that had boon mado, and it jjoes on to say: 



These MMrclumxt'H for the I: ,«! 



thiTi'lDrc ilirc<(|\ s Tviiii; lli _ . . ixn 



making; it more (iesirahh' collatnral in tho inoiioy rpnlcm and prnvidini; a wulor fifld 

 for itM U!t(>fiihi(t9s. 



The rapiilily with which tho cix>ppnitiv(> tnarkolinira'iNx-ialioiu) urc lif>inff nrvanizMl 

 thri)ii^:h(»iif lh<' fuuiitrv uml the variei 

 into this iH'W scllinu nlun i.-< niakiiiK it i • 

 cun-ful ••ousidcrution !>> lioth hiiiikor an<l larinor. 



Tho I nit(><l Stitti'.s wurehoiw ii<l in just now «'o'i<!t>" 'x^i" 

 the hunker, aiul the public jieiierully will he p 

 legislation Certainly it ha** oi)ene<l a t' 

 would nol otherwise have hail ami il . 

 hmns with warehouse receipts eoverini; airriculinral pnxltn 



Your committee wishes to commend the act to your i"on 

 many advantatros will ho of prrowinK benefit to thn country 



In tliis connection, to show tho committee how closely we have 

 worked with the War Fiiiniice Cot j)orati<»n, I wotd<l like to include 

 in the record Ji letter si<;ned hy tlie inana<;in<; direct. .p <>f tl... W-ir 

 Finance Corporation, reading as follows: 



1 wish to take this op])ort unity to thank you for the valuahio servirc* whirh your 



hureau has ren<lered to the War Finance C'or|>i>ratir)'i in connc ' le 



by the War Finance <'or)>oration to c(X)perati\e niarketintj a- it 



the Initefl Stales. 



These loans have been made as you know on the security of warehoiis*; n-eeipta 

 representiufj the eomnuHlities to be marketed, audit has been of prime iniportanco 

 that such commodities be j)r<)perly warehoused. In a lar_" ity of ( ■ o- 



orative as.sociations obtainini: advances from us have ;„nven ;i iiy rere; -d 



by federally licensed warehouses, licensed and supervise*! I)y your bureai. Tho 

 fact that a warehouse is so licenced and supervised has given us added feeling of 

 security and an assurance that our interest in the security was beinp properly cared 

 for. and the integrity of the warehovi.«K^ receipt re.-<pected. 



From my ex])erience in the work of the \Var Finance Corporation. I believe that 

 the safeguards impo.sed under the licensing svstcm of your bureau a i?ly to the 



value ol a warehouse receipt as security and works to the advantu_ . iie {N-rsona 

 or institutions which lend money on warehouse receipt securitv, of the owner of the 

 commodities, and of the warehouse which assumes res])onsibihty for the r • 



We have found the form of warehouse receipt refpiired by your bureau • ly 



valuable in connection with our loans. In connection with our cotton or 



instance, the warehouse receipt issued by federally licensed warehouses i ■ • i«n 

 its face not only the number of bales, but the weight, grade, and staple of the i-otton. 

 Such certification adds greatly to the value of the receipt as collateral. 



Mr. Chairman, it is not necessary, or I do not believe it is necessary, 

 to hurden the record to show tlie progress we have been making 

 under this piece of legislation, but as you can easily appreciate the 

 usefulness of it will depend in large measure upon the attittide \\hi<'h 

 the bankers mav take towjird the federalized warehouse receipt. 

 Therefore, 1 woukl like to put into the record |)art of a letter from the 

 recent governor of the Federal Reserve Boanl, reading as follows: 



I think it is recognized by banks and other fuiancial institutions that se 



receipts representing readily marketable nonjM^ri.shable agricultural <^i :ie« 



properly warehoused are a desirable kind of security for bank loans. It is apparent, 

 of course, that some warehouse receipts are more desirabU- than otl ' ' ho 



degree of desirability is dependent upt)n a number of factors, inclu.. h 



are the form and legal effect of the receipt, the (|uestion of whether or not the i.-«suin(f 

 warehouseman is licensed, bonded, and operated under Fetleral law or a .^tate law 

 furnishing proper .safeguards, and is supervised and examined by conipt>tent otiieials 

 with a view to the protection of the public, the reputation and finan<-ial responsibility 

 of the warehousemen, the physical conditions affecting the warehouse, the (juestion of 

 insurance, etc. 



