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Ex-Officio members W. P. G. HARDING, G O V E R N O R P A U L M. WARBURG, V I C E G O V E R N O R FREDERIC A. DELANO ADOLPH C. M ILLER CHARLES S. HAMLIN WILLIAM G. McADOO S ecr e tar y o f th e T r e a s u r y C H A IR M A N JOHN SKELTON W ILLIAM S Co m p t r o lle r o f th e C u r r e n c y FEDERAL RESERVE BOARD H. PARKER W ILLIS , S E C R E T A R Y SHERMAN P. ALLE N , A S S T . S E C R E T A R Y and W ASH ING TO N F is c a l A g e n t AD D RESS R EP LY TO X—335®DEBA1“RESERVE board August 22/ 1917» Dear Sir; The Board, has received a letter from the food administrator, Mr. Hoover, stating that he is just beginning a campaign to secure a larger amount of cattle feeding in this country, and that his in vestigation shows that -the interest charge represents between thirty.five and forty per cent of the total costs of this industry* The legal rate of interest in many of the cattle raising states is 8f> or more, and the food administrator' suggests that if banks would make loans to the cattle people at a rate of interest not exceeding 7$ (which he thinks they can afford to do in view of the 5$ rediscount rate on six months* paper based on Jive stock, available at most of the federal reserve: b§,nks) a stimulus would be given to the cattle raising industry, which all will agree is greatly needed at this time* The Board appreciates, of course, the limitations upon its powers in th\s respect, and does not wish to put any pressure upon the b^nks to induce them to charge less than legal rates, but it is informing you of the suggestion made by Mr. Hoover in order that* should you deem it expedient, you may point out to your member banks this opportunity of rendering yery effective help in the present food crisis* Very truly yours, Governor*
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