All I can say is that you
cannot get money to lend on farm loans in this country at 24 or 3 per cent. The farm loan act provides that the moneys loaned should be loaned at 14 per cent more than is paid for the money. If the money is borrowed at 3 per cent the farm loan board lends it at 44 per cent. The farm loan board is not the government by any means, nor is the government the farm loan board. The farm loan board exercises an independent jurisdiction and makes its loans without reference to the government or anybody else, but the government has so far bought about ten million dollars of securities issued by the farm loan board to put it in funds to make the loans. The provision here is to enable an increase in the sum to be loaned in order that we may take care of those who have no capital, and we are dealing with that in section 9, making it a little more specific than it now is about supplementary advances.
I can only say that it would be quite impossible to take the money out of the post office savings banks and lend it on farm loans. If we did we would have a situation in this country that other countries have
Farm Loan Act
had, namely, frozen, assets with which to meet the demands of depositors for their money. As it now stands, we have to maintain ten per cent in gold, metallic coverage, for post office savings, and that has been the law in this country for a very long time in order that post office savings may always be available to depositors who desire to get them. Depositors have to give so many days' notice of their intention to withdraw.
Subtopic: PROVISION TO FACILITATE AND INCREASE EXTENSION OF CREDIT TO FARMERS