Agricultural relief: Agricultural relief

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Multivolume work

Identifikator:: 1831932415

Document type:: Multivolume work

Title:: Agricultural relief

Place of publication:: Washington

Publisher:: Gov. Pr. Off.

Year of publication:: 1928

Collection:: Economics Books

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Volume

Identifikator:: 1831935066

URN:: urn:nbn:de:zbw-retromon-232142

Document type:: Volume

Title:: Agricultural relief

Volume count:: Pt. 7

Place of publication:: Washington

Publisher:: Gov. Pr. Off.

Year of publication:: 1928

Scope:: III S., S. 521 - 590

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

526 { AGRICULTURAL RELIEF depress a price during a period, whether that be short or long. That is the point I am trying to make. Now I will answer any question. Mr. KercEAaM. Mr. Anderson, I would like to have you complete your statement. Mr. AxpErsON. I am through with this part of it. Mr. Kercaam. But, I am wondering about how much time is involved, because I am sure there will be a considerable number of questions. Mr. AnpeErsoN. I am through with this general part of the state- ment, and I recognize how difficult it is to follow through a long statement and then go back to questions which one wants to ask in connection with particular portions of it. As I say, I am through with this particular general statement, and if I can be in any way, with my modest ability, helpful to the committee in connection with the general problem, I am delighted to do it. Mr. KincHELOE. I think you made a very fine distinction there between the Federal Reserve Board and this proposed farm board. But do you think their duties and responsibilities are anywise parallel? Mr. AxpeErsoN. The objects, of course, are quite different. 1 only used the illustration because it had been used by others, and it seemed to me that the illustration was susceptible of interpretations which were not entirely justified. The point I am trying to make here is this: It is perfectly clear, I think—I do not think anyone would deny it, in the Federal Reserve System or out of it—that by a manipulation of the reserve rates and by open-market transactions you could have a direct effect upon the level of prices; at least for a period. But if you attempted to do that you would probably have a far greater fluctuation in those prices than you have now. The difficulty either in the case of credit or in the case of attempting to stimulate the price of a crop is this: In addition to the market effect of your stabilization organization, you also have the market effect of actions of everybody else who is dealing in that commodity. If, for example, the board or the organizations promoted by it started out at the beginning of the crop year with a price of $1 a bushel for wheat and with the idea of stimulating the price to $1.25 a bushel, a lot of other people would immediately start buying wheat also In order to get the benefit of the rise in price. The result might easily be a stimulation of the price to $1.50 a bushel or more, with the consequent drop in the price unless the board or other organiza- flons were able to maintain it upon the higher level. This might prove impossible. Mr. FurmEer. Right there, I understand that under this bill the speculator would have an advantage because of the holding of the surplus he would be able to ride the market. in other words. bull the market. Mr. AnpErsoN. He might do that. A lot of people have been trying to do that in stock for a long time, and some have made money and a lot of them have lost an awful lot. The point I am trying to make is not that it is not possible, pro- viding your fundamental principle is right, to bring about a certain degree of stabilization. But I do not think it is possible, except by feeling your way into the proposition—bv letting evervbody know

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