Show AUTHENTIC STATEMENT special to THE B babson ha has some good news 1 BABS ON PARK MASS J july uly 9 i it readers d hl have already re d sew see fit n the newspapers that the fedral cral reserve Ite serve board has reduced lie the reserve requirements which banks insist carry this directly or indirect indirectly tah should help every reader 0 of this h is column I 1 wish to explain what it mea means new now federal reserve ruling for the past few bears ears every bank batik lias has been required to keep on hand a reserve of 0 various percentages up to 24 per cent in other words when you deposited the ho bank batik heretofore has been able to loan only about 80 of this money this amount varies with different banks and I 1 merely use this figure as a variable illustration the large city banks have one percentage foi reserves those of the waller smaller cities have another percentage but every member of the federal lRe reserve serve system has a required percentage D during u ring the eisenhower Elsen hower w er administration when so much less government money has been freely passed out by government bureaucrats there has been a tightening tighten tightening int up along the line farmers have ave found it more difficult to borrow on crops builders have found it harder to get mortgages and every loan by local banks bus has been scrutinized more carefully this is all a part of an honest attempt by the new administration to prevent inflation in most cases it has not been due to any change of laws but to a careful handling of the government funds eisenhower does do not want a depression the above more businesslike program has caused congressmen to get thousands of letters rom readers complaining corn elal I 1 ng that hat applications application A or r g loans were v ere beng ing turned down for fear that his this combined with the droughts from rom which aich sections are suffer ing and the unsettled foreign situation might bring about a depression these cong congressmen gressmen have lave been pestering the white house probably your congressman was one of these ike in effect replies to them that he will not resort to former carelessness and will continue to handle the governments money as if it were ere his own but it they want to change the rules in a fair and honest manner ho he will abid by them ai As a result the federal reserve board by changing the reserve requirements has made it possible for banks to loan more money congress has also changed the law enabling veterans to buy more expensive homes with a down payment which could be as low as 5 percent congress is in the process of 0 also loosening up restrictions along other lines As a result any farmer builder or businessman who now has an honest need for funds can with reasonable security get a loan there however must be no politics connected with the loan what about money hate rates some months ago I 1 forecast in this column thai that interest rates would be higher all large cit city banks have sin since c e then raised raised their rate it if interest so have banks of many smaller cities whether your own local bank has raised its interest rate since president eisenhower Elsen hower was inaugurated augu rated I 1 do not know if however lio wever it it has not already done so it should count ten tew before it does so now one thing continued on page 19 16 AUTHENTIC STATEMENT continued from page 8 0 is certain when you now attempt to borrow money from your local bank and are refused raour ahe bank can no longer blame it unto onto the new administration I 1 hear bear this Is 1 a popular excuse for turning down loans or raising interest rates tates by banks in democratic mo cratic communities when the new administration came come into power you were obliged to put up a margin of 73 75 percent when you bought listed stocks in case you did not pay in full soon this percentage ge we was reduced to 50 percent which should b have ave made mado stock go up in price rice but they did not ris rise e T this hr I 1 Is a good illustration of how prices are really controlled by fundamental conditions and not by legislation the old law X aw of action and deac reaction e ton still continues you can lead the horse to water but you cant make him drink As aado to the general business outlook I 1 at ahi still cautious b but ut if your local bank now loan money more freely to 0 o good citizens it cannot blame the federal reserve or bureaucrats the reas on will be that businessmen have decided to depend more on bon hon eaf est work v intensive selling and more advertising rather than on borrowing money A newspaper paper survey covering 1724 physicians phyl clan revealed that wt 1700 of them believe women ifould wear shoei hoei without stockIngs 1 much of the increase in serious toot foot trouble among women the doctor doctors said aid Is due to the practice of going without stock logs in sum ummer |