People in the newer western parts of the country saw themselves as starved of access to credit and viewed higher interest rates in their areas as reflecting the scarcity of funds. Regional interest rate differentials persisted until around the time of World War I and helped shape the attitudes of Americans living in western areas toward the nation’s financial system.
4 These regional differences gave rise to a major political movement in the latter part of the 19th century, as western farm borrowers increasingly demanded a reform of the U.S. monetary system. Their chief complaints included the high interest rates they faced as well as the burdens placed on them by deflation that increased the real value of their debts.