■; '»: 



A.-]rj::. 



ity prices were much higher than the 

 ratio of gold stocks to production of 

 other commodities demanded. During 

 this period the world monetary stock 

 of gold increased 38 per cent; world 

 volume basic production also increased 

 38 per cent. If the 75-year pre-war 

 relationship had continued, pre-war 

 prices would have been expected. 



"Why were prices so high from 

 1914 to 1929?" he asked, and an- 

 swered that the reason, apparently, 

 was due to the low demand for gold. 

 "When the World War broke out, 

 most of the European countries aban- 

 doned the gold standard. Gold was 

 no longer in demand, and it drifted 

 to the United States and other neutral 

 countries. This reduced demand for 

 gold made it cheap and, as a result, 

 commodity prices in terms of gold 

 rose in the few countries that re- 

 mained on the gold standard. It was 

 the gold and not the commodities that 

 changed. After the war was over, the 

 return of one country after another 

 to the gold standard increased the de- 

 mand for gold so that its value rose, 

 and commoditity prices fell. 



"The world is now conducting a gi- 

 gantic experiment in varying the price 

 of gold to overcome the devastating 

 effects of the rising value of gold and 

 declining commodity prices. Thirty- 

 four countries, including the United 

 States, have abandoned the attempt to 

 maintain their fixed legal prices for 

 gold and are raising their buying 

 price for the metal. When this ex- 

 periment is over, some of these na- 

 tions may have money units variable 

 in weight but stable in value. No na- 

 tion has had wild inflation when it 

 had a high metallic reserve. The solu- 

 tion to the world situation lies in re- 

 ducing everything to the price level 

 or increasing the price of gold. The 

 world has found it expedient to adopt 

 the latter course." 



A scientific money. Dr. Pearson con- 

 tinued, is one with a constant buying 

 power for all commodities rather than 

 a fixed weight of one commodity. Our 

 whole tax and credit structure rests 

 on commodity prices. If this struc- 

 ture is to be kept sound, he said, for 

 both creditor and debtor, commodity 

 prices must be kept stable and not 

 the weight of gold in dollar exchange. 

 He declared that by changing the 

 price of gold a country can establish 

 any price level it wishes independent 

 of other countries, and by that act es- 

 tablish its internal business conditions 

 which, in turn, affect securities. 



During the last ten months of 1933, 

 he stated, the price of gold in the 

 United States rose 56 per cent; in the 

 United Kingdom 5 per cent. At the 

 same time prices of commodities rose 

 56 per cent in America and 15 per 



Mayor Claude Madden of Danville in 

 his spirited welcoming address on the 

 opening program of the I. A. A. con- 

 vention said "Danville is one of the 

 two cities in the United States in 

 which all the banks opened the morn- 

 ing the bank moratorium was called 

 off." He received a great ovation from 

 the crowd when he told the members 

 the town was theirs for the duration 

 of the convention. "Park your cars on 

 the streets all night and stay as long 

 as you want to," he said. ' : 



cent in the United Kingdom. This 

 comparisons was based on prices of 15 

 identical commodities. 



"In the general advance in farm 

 prices," Dr. Pearson said, "that ac- 

 companied the rising price of gold, 

 most products advanced but not at a 

 uniform rate." He said this happened 

 because the gold price is only one of 

 the four major factors affecting the 

 price of a commodity. The price of a 

 commodity in large demand and short 

 supply advances much more rapidly 

 than the price of gold and conversely 

 he stated, the price of a commodity 

 of low demand and large supply will 

 not advance so rapidly as the price of 

 gold. 



We should not be too disturbed be- 

 cause so little progress has been made 

 in the past toward obtaining a stable 

 measure of value. Inertia is such a 

 dominant force in our thoughts and 

 actions, that great changes rarely oc- 

 cur until an unusual event forces them 

 upon us. The unparalleled peace- 

 time rise in the value of gold forced 

 the issue and very rapid progress is 

 now being made. As a result of the 

 unparalleled chaos of the last three 

 years and the present widespread 

 knowledge concerning the problem, it 

 is possible that we may get a stable 

 measure of value so that our children 

 and our children's children will not 

 suffer from the violent fluctuations in 

 the value of gold which this genera- 

 tion has experienced. If we get it, the 

 price we are paying, although high, is 

 cheap in terms of human progress. 



I. A. A. Record — February, 1934 



Messages Read At 



Annual Banquet 



In addition to messages from Presi- 

 dent Roosevelt and Speaker Henry T. 

 Rainey, President Smith read tele- 

 grams and letters of greeting to the 

 convention from W. I. Myers, governor 

 of the Farm Credit Administration, 

 State Senator Simon E. Lantz who 

 was unable to attend because of ill- 

 ness, and Sam H. Thompson of Quincy, 

 former A. F. B. F. and I. A. A. 

 president. Chester Davis brought a 

 personal message from Secretary of 

 Agriculture Henry A. Wallace who ad- 

 dressed the meeting last year. 



Infornnational Service 

 Emphasized in Conference 



More Than 500 Hold Lively Ses- 

 sion Discussing Organization, 

 Information, and Collections 



BETWEEN 500 and 600 delegates, 

 members and farm advisers at- 

 tended the organization-infor- 

 mation conference held Thursday 

 afternoon, Jan. 25, in the Wolford 

 Hotel, Danville. The session was de- 

 voted to shop talk on publicity, or- 

 ganization and collection problems. 



An effective County Farm Bureau 

 publicity program is broad and varied 

 and seeks to inform not only members 

 about the work and benefits of the 

 organization but also attempts to in- 

 terest non-members, George Thiem, 

 editor of the I. A. A. RECORD, told 

 the conference. He stated that there 

 are still many farmers in Illinois who 

 apparently know very little about the 

 part organization has played in bring- 

 ing about benefits through federal and 

 state legislation. 



He suggested that County Farm 

 Bureau bulletins be filled with more 

 live news written from a local angle 

 and telling what the organization and 

 its members are doing. He advocated 

 community and township meetings, 

 such as those now being held over the 

 state to explain the corn-hog pro- 

 gram, as a means of informing more 

 people about Farm Bureau services. 

 He stated that the County Farm Bu- 

 reaus in Illinois that were doing ef- 

 fective publicity work v/ere the ones 

 that were gaining in membership; 

 that the organizations which gave 

 very little attention to news releases 

 and informational service were losing 

 members and going down. 



George E. Metzger, director of or- 

 ganization, emphasized the necessity 

 for Farm Bureaus cutting off service 

 within a reasonable time after dues 

 become delinquent. When the County 

 Farm Bureau is not making progress, 

 (Continued on page 18) 





