Full text of Central Western Banker : October 1934, Volume 29, No. 10

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

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Federal Reserve Bank of St. Louis

CENTRAL WESTERN

BANKER
Omaha

r

Omaha

1imixrii*P Ï

C

*

f i .i

i

East Meets W est at Omaha
(See Page 8)

October

1934

Make Our Bank Your Office
When You A re in Omaha


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Federal Reserve Bank of St. Louis

•

The First National Bank of

Omaha and the banking institu­
tions in the surrounding area have
grown up side by side in a spirit of
friendly co-operation.
We are interested in your prob­
lems and in the conditions in your
territory. That is why we ask you
to drop in whenever you are in
Omaha and talk things over.
Make this bank your Omaha office.
Have your mail addressed here,
and use our telephone exchange,
Atlantic 0500, for your calls.
Whether you are a customer or
not, we are always glad to see you.

FIRST NATIONAL BANK
OF OMAHA
MEMBER

OF

FEDERAL

RESERVE

SYSTEM

3

Central Western Banker, O ctober, 1934

C E N T R A L W E I TER N RAN RER
410 A R TH U R BUILDING
O M A H A
C l iff o r d D e P l'Y , Publisher
R. W . M oo rh ead , Associate Publisher
F r a n k S. L e w i s , 511 Essex Bldg., Minneapolis

H . H . H a y n e s , Editor
F r a n k P. S y m s , Vice-President, 19 West 44th Street, New York

Subscription, 25 cents per copy; $2.00 per year. Entered as second-class matter at the Omaha postoffice.

O C T O B E R , 1934

V o l u m e 29

N u m b e r 10

^Advertising is more than blowing the ship’s horn or writing the log.
is a continuous voyage.

Advertising

It is the art of getting to desired destinations,

the art of establishing permanent trade between ports, the art of
projecting business objectives and then attaining them

Right
Is The Time to A d v e r tis e
A D V E R T I S I N G in general is an
art that requires enormous grasp
of technique, much more so finan­
cial advertising — and if ever, surely
now. W e may know how to toot the
horn, even the mighty log horn, and
make a helluva lot of noise; we may
know how to write cleverly and engag­
ingly of the cargoes and of the sea ser­
pents and mermaids along the way, to
make the log both interesting and ro­
mantic ; we may know the instrument
board and how to maneuver the ship in
all directions, but------D o we know how to chart a safe and
paying advertising course for our insti­
tution? Have we measured the bounds
of our institution’s ocean or pond? D o
we know how far she can safely essay
to go and where she wants to go and
where she should go ? D o we know
which are the worth while ports and
where the dangers lie?
If we don’t know these fundamentals
our advertising technique is not of suf­
ficient grasp.
Safe Start

But if we do know every foot of the
course and ju.~t where we should and
would so------
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Federal Reserve Bank of St. Louis

By EDW IN BIRD WILSON
President
Edwin Bird Wilson, Inc.
New York City
Are we dead sure that the institution
can stand a real advertising voyage? Is
she safe and sound from bow to stern
and from keel to tops’l? Is her crew ex­
perienced, human and loyal ? W h a t’s her
carrying capacity? H o w much power in
her boilers? Is our ship of finance fouled
with barnacles? Has she sprung any
leaks that might menace her safety in a
storm ?
If the institution is not in good condi­
tion, have her put in ship-shape before
we recommend an advertising expedition.
D on ’ t expect advertising to save an in­
stitution that is unseaworthy.
N ow, I admit these observations are
somewhat the result of hindsight, al­
though for many years I have said, “ If
you are doubtful of your own integrity,
don’t advertise.” Hindsight has magni­
fied the importance I place on this prin­
ciple. A bank, an investment house, an
insurance company must be intrinsically
sound before it advertises in order to
profit permanently by and after adver­
tising. Pseudo successes have been pro­

duced by able advertising, advertising
which was superior to the product or
service it worked for, advertising which
was prostituted by some unworthy busi­
ness. But in the long run and the final
washout an unsound business w ill find
its deserved level, and even advertising
cannot save it.
After Business

If we have the necessary grasp of fi­
nancial advertising technique, we will
determine in advance whether we are
really going out for real business or just
on a joy ride. T here may be times (I
don’t know of any) when advertising
for the mere sake of advertising is justi­
fiable. Advertising and publicity junkets
have at times been sponsored by financial
captains. Personal glorification accounts
for some of them, but does not truly
justify them.
Serious salesmanship is the only true
justification for embarking on an adver­
tising course— selling the institution and
selling its services. And good goods are
the only kind worthy of serious sales­
manship. A t this post-liquidation marker
it is good advertising technique to size
up our product, our reputation, our pres­
ent ideals. It is a time when advertising

4

Central Western Banker, O ctober, 1934

talent should refuse to help the sale of
financial junk of every variety, a time
when it should throw its whole force,
influence and enthusiasm into the pro­
motion of the best financial goods and
services.
And let us remember that every finan­
cial institution is engaged in barter, not
selling alone but also buying. W h at is it
buying? Confidence or suspicion— repu­
tation. One cannot sell junk without
buying something just as worthless.
W h en we are planning to go seriously
after good business, the best business for
our institution, we must have in our
technique outfit a definite knowledge of
our customers and prospects and how
worth having or getting they are. Some­
thing worth selling to worth while cus­
tomers— that’s a fundamental precedent
to a successful advertising voyage. There
must be an understanding that a fair
exchange is necessary at every port of
call.

in with the N ew Deal. T h e main chan­
nels are not changed much and, if we
knew them before 1934, we will still
know them. T ruth and honesty are pret­
ty much the same. Sound banking prin­
ciples are unaltered. T h e mutual rights
and duties of bankers and their custo­
mers are constant.

Cost
W h at will the trip cost? T hat is a
very important consideration to be
weighed before taking any kind of a
journey.
T h e competent and honest technician
will not advise an institution to take an
advertising trip that it cannot afford.
Should the trip be de luxe, first cabin
or tourist, or should it be undertaken at
all?
M ore respect is due the financial
house that consistently refrains from ad­
vertising than to the house that believes
in advertising but is afraid to advertise
consistently. M ore than once I have said
to bankers, “ Advertise adequately or not
at all. If you are not willing to commit
your institution to a wise advertising
course — intelligently planned and exe­
cuted and continuous— keep out entirely
and save your money.” But mere size
of appropriation sometimes is a less im­
portant part of successful financial ad­
vertising. T h ere’s where the enormous

A
jN

Edwin Bird Wilson

grasp of technique comes in. M aking ev­
ery dollar count is the result of tech­
nical knowledge. T o o many appropria­
tions are used up by rule of guess work.
A nice clean, orderly, accountant-like
budget sheet doesn’t mean a thing, if
you don’t know what items are worth
budgeting and how and why and where­
fore. It is a good time, now, to ask some
cost questions. Is my institution spend­
ing enough, or too much, for advertis­
ing? If the appropriation is of right
amount, is it being spent wisely? Should
we revise our allocation of expenditures?
N ew conditions may have made our old
budget obsolete.
Practical Test

And after all these preparations, it
would seem about time to be on our ad­
vertising cruise, where seamanship will
receive its practical tests. N o matter how
Admiral Byrd-like we may have planned
before starting, we will find the opera­
tion continuously demanding our skill
and alert watchfulness. Let us face the
situation as it is today— and from day
to day. W e must know all the old ropes
and not a few new ones that have come

Correction

A N article published in the September issue of the C entral W estern
Ba n k e r , relative to the operation of Co-operative Credit Associations in N e­
braska, the statement was made that “ it is rumored that the present department
head (E . H . Luikart, Nebraska Banking Commissioner) is secretly interested in
the Union Credit Service Association.”
Recent information from an authoritative source advises that M r. Luikart is
not directly or indirectly, secretly or otherwise, interested in the above association.
W e are glad to make this fact known to our readers, and offer our sincere apologies
to M r. Luikart for any injustice the previously published statement may have
caused him.

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Federal Reserve Bank of St. Louis

Experience has taught us to keep an
eye on the weather and we will do that,
if we are competent technicians. There
are times to trim sail and times to put on
more canvas. Races are won by superior
technique. T h e advertising copy that is
best for one week may not be best for
another. Some of our clients have copy
enough approved for many months, yet
they carefully select the time of its pub­
lication, and do not schedule it too far
ahead. 4 hey believe in the timeliness as
well as the truth and wisdom of a state­
ment.
Pilot and Grew

Seamanship depends upon pilot and
crew. Advertising technique is depend­
ent upon pilot and crew. Every advertis­
ing manager is a pilot, every cooperat­
ing agent or counsel is a co-pilot. There
must be complete coordination and un­
derstanding between the co-pilots, and
they should have complete cooperation
from the whole crew, without exception.
Indifference, lack of understanding, pet­
ty politics, may be as fatal to an institu­
tion’s advertising success as open mutiny.
Some of you are blessed by the whole­
hearted support of directors, officers and
staff; others, I dare say, feel discouraged
at times, perhaps virtually isolated and
helpless, by the lack of support. If you
are competent pilots you will not only
know what to do but how to get it done
and that includes winning the full co­
operation of your associates.
A t the risk of being misunderstood
and criticized for lack of good taste, be­
cause of my position in business and on
this program, I am going to say a word
of utter truth. Some advertising officers
are hampering the progress of their in­
stitutions and actually defeating their
own advertising objectives, by failing to
advocate the employment of supple­
mentary outside counsel, by being w ill­
ing to assume alone a responsibility
whose very nature demands that it be
shared with a co-pilot.
A good ship with competent co-pilots
and a loyal, hard-working crew, need
not fear for the results of a carefully
prepared advertising cruise, even in these
times. W h y did I say even in these
times? It must have been an echo of

Central Western Banker, O ctober, 1934

banker psychology. A nd banker psychol­
ogy is a hang-over from the big financial
party which lasted all night and far into
daylight. But it is daylight. D o n ’t let’s
forget that. And instead of saying “ even
in these times,” let us say “ in these, of
all times.”
A good financial institution, with
competent co-pilots and a loyal, hard­
working crew, need not fear for the re­
sults of a carefully planned advertising
cruise, in these of all times.
Blind Faith

T h e attitude of some bankers toward
advertising is tragically mistaken. W hen

deposits are hard to get, they say “ there’s
no use advertising because there are no
good accounts to be had.” W hen de­
posits are abundant, as now, they say
“ W h a t’s the use of advertising when we
have so many deposits we don’t know
what to do.” T his not uncommon atti­
tude of bankers shows at once a blind
faith in the efficacy of advertising and a
deep ignorance of its most important
uses. T hey believe that advertising will
accomplish direct, specific, tangible re­
sults ; but they do not know that adver­
tising is the art of establishing perma­
nent trade, the art of projecting busi­
ness objectives and then attaining them.

Fortunately there are members of the
banking fraternity who do know what
advertising really means and who act on
that knowledge. T hey are on a continu­
ous advertising voyage, with regular,
scheduled sailings, founding institutional
trade, establishing public reputation,
growing in strength with the years. F ow
deposits or high, high interest rates or
low, borrowers scarce or plenty, these
bankers are in business fo r life, not just
fo r today and to fly by tomorrow. They
are building institutions to out-live
themselves. T hey believe that advertis­
ing can help them to build soundly and
(Continued on Page 13)

78 Million Into Farmers Pockets
R O D U C E R S cooperating in the
corn-hog program were paid more
than two and a quarter million dol­
lars a day on their adjusted contracts
during the week ending September 15,
the Agricultural Adjustment Adminis­
tration announced.

P

A preliminary report shows that up to
September 14, payments totaled slightly
in excess of $78,500,000. T his amount
represents nearly 60 per cent of the total
first installment of approximately $133,000,000 now being paid to farmers par­
ticipating in the 1934 corn-hog adjust­
ment program. Thus far checks have
been mailed to over 800,000 contract
signers in 39 states. Approximately 1,200,000 corn-hog contracts were signed
by farmers.
From September 8 to September 14,
inclusive, corn-hog adjustment payments
approximated $15,867,259, the prelim­
inary report shows. In one day, Septem-


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Federal Reserve Bank of St. Louis

her 12, checks totaling over $3,700,000
were mailed to more than 38,500 pro­
ducers.
Up to September 14 a total of 829,641 contracts had been received and re­
leased for payment by the rental benefit
audit section of the Agricultural A d ­
justment Administration. O f this total
number, 129,516 were early payment
contracts received from 514 counties,
and 700,125 were of the regular pay­
ment type approved for payment in 1,619 counties.
T h e 829,641 contracts received and
relesed for payment up to September
14, represent about 70 per cent of the
total of approximately 1,200,000 con­
tracts signed by corn-hog producers in
the 1934 program.
Payments up to September 13 were
made to producers in 39 states as fo l­
low s: Alabama, $183,604.90; Arizona,
$17,168; Arkansas, $301,156.30; Cali­

fornia, $709,160.60;
COFORADO,
$138,178.45; Connecticut, $2,001.75;
Delaware, $12,883.85; Florida, $117,257.15; Georgia, $63,526.95; Idaho,
$34,819.10; Illinois, $3,107,859.05; In­
diana, $6,427,190.80; Iowa, $20,541,771.32; K A N S A S , $4,404,335; M ary­
land,
$119,290.60 ;
Massachusetts,
$150,678.60; M ichigan, $153,849.45;
Minnesota, $5,072,151.55; Missouri,
$7,771,464.08; M ontana, $86,513.65;
N E B R A S K A , $7,177,712.80; Nevada,
$25,079.85; N ew Hampshire, $1,468;
N E W M E X I C O , $83,342.10; N ew
York, $5,217.80; North Carolina, $26,398.60; North Dakota, $259,331.65;
Ohio, $6,862,953.80; Oklahoma, $245,239.65; South Carolina, $152.50; South
Dakota, $4,198,942; Tennessee, $151,336.80; Texas, $743,210.55; Utah,
$61,801.85; Vermont, $ 3,698; Virginia,
$610,132.70; W ashington, $285,193.40;
W est Virginia, $69,810.60; Wisconsin,
$2,330,863.05.

6

Central Western Banker, O ctober, 1934

How Co-operative Credit Associations
Operate in Nebraska
On page five of the September issue of this publication appeared an article on
Nebraska Co-operative Credit Associations, prepared from the viewpoint
of a banker.
N Y O U R September issue a quite
lengthy article appeared entitled
“ Co-operative Credit Associations
Operating in Nebraska” which I have
read with much interest, perhaps for the
reason that I am the secretary-treasurer
of one of these “ mushroom” ( ? ) banks.

I

A t the outset, I will say that I believe
your publication aims to be fair in any
matter which comes under discussion in
the columns of your paper, for I realize
that the thoughts expressed in the above
mentioned article are not opinions of the
editor, but rather expresses the ideas of
someone who is either prejudiced in the
matter involved or has been grossly mis­
informed about several angles of co-op­
erative banking as carried on by co-op­
erative credit associations, organized un­
der the Union Credit Service associa­
tion of Lincoln, Nebraska.
Legality

Let us take a look at the legality of
the organization of these Co-operative
Credit associations. Any person who may
be interested in this particular phase of
the matter may refer to Article 13,
Sections 24-1308 to 24-1329, inclusive,
of the Banking L aw of the State of N e­
braska.
W e should not lose sight of the fact
that the legislative body which enacted
laws governing commercial banks also
enacted the law permitting co-operative
credit associations to be organized in
this state. For this very reason I do not
understand why the writer of the above
mentioned article feels that commercial
banks should be given preference over
co-operative credit associations, and I
also know that the legislative body did
not intend it to be so, for class legisla­
tion is always avoided and even declared
unconstitutional by our state and feder­
al constitutions.

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n keeping with our policy of presenting both
sides of any controversial
subject, we publish here an
article written by an officer
of a credit association, in
which he refers to a number
of statements made in the
story appearing last month.

By F. W. BULS
Secretary-Treasurer
Garland Co-operative Credit Association
Garland, Nebraska
Banking Facilities

If citizens of a certain community,
who have been deprived of banking fa­
cilities, get together and organize an
institution which will take care of their
needs, does it seem reasonable that some­
one who is not interested in the welfare
of this community, should be justified in
criticizing these citizens for doing what
they deem best to further their interests?
I am wondering whether the writer of
the above mentioned article ever lived
ten, fifteen or twenty miles from a bank­
ing town and knows the conditions as
we have them today.
Furthermore, I know of no case where
a co-operative credit association has been
antagonistic toward a commercial bank
or even threatened to be a menace to
commercial banking.
If, as your article states, the Omaha
W orld -H erald condemned the manner of
organizing these co-operative credit as­
sociations, and if the Nebraska Union
Farmer has used the term “ mushroom
banking” when referring to co-operative

credit associations, it is sufficient proof
that neither publication has been suffi­
ciently informed to be in a position to
pass intelligently upon the advisability
of creating and operating these credit as­
sociations. Have the large reserves,
of which the commercial banks have
been boasting, been materially reduced,
due to the recent organization of these
co-operative credit associations ? I am
inclined to believe this is not the case,
and the bankers also know that is not
true. T h e statement may be true that
“ banks are finding it difficult to make
earnings on their investment,” but every
i easonable person knows this deplorable
condition has not been brought about
through organization of numerous coopeiative credit associations. Let us take
a look at the farmer. Is he reaping earn­
ings on his invested capital at present?
Does the merchant realize the dividends
from his investment to which he is en­
titled? If not, why do we not make an
effort to discourage merchants or farm­
ers in order that their number may be
reduced and thereby create a larger
earning power for a few who feel they
have a monopoly along a certain line?
Ideas of that kind are not in harmony
with Americanism.
Assignments

W ith reference to assignments issued
by members of co-operative credit asso­
ciations, the article in question states
that “ it is dangerous for a bank to re­
ceive the assignments issued by members
of these associations and should always
receive them for collection, for reason
that the amount deposited to the credit
of a member is subject to any fines, or
loans, or other obligations to the asso­
ciation.”
1 he above statement is true in so far
as share deposits are concerned, but as(Continued on Page 12)

7

Central Western Banker, O ctober, 1934

How to Create
A "B ank-S pirited”
Public
F. N. Shepherd
H A T , in the simplest terms, is
a bank?
I define it as a place where peo­
ple bring their money and leave it with
the understanding that the holder —
called the banker— has the privilege of
loaning and investing this money at a
profit, provided he holds himself ready
to return it when demanded.
For this privilege the banker assumes
definite obligations to the depositor.
I was a cashier o f a bank several
years: I have read somewhat of the the­
ory and practice of banking; and I have
talked with many practical bankers
about banking; yet never have I found
the thought seriously advanced that the
bank owed the customer, in return for
the privilege of holding and using his
deposited money, any of the follow in g:
Maintenance of a day nursery for tired
mothers
Acting as railroad and ticket agents to
customers
Collecting fraternal dues
Distributing bats and balls to boys’ clubs

By F. N. SHEPHERD
Executive Manager
American Bankers Association
New York
than they did in respect to operating
costs. T h e people simply did not take
banking seriously enough.
W e must not only get and hold bus­
iness, but we must get and hold it by
proper methods— methods that command
respect and create confidence.
W e must develop in the minds of
those who use banks, or of those who
think about banks, a proper conception
of what a bank is and what is should
do, instead of leading them to expect all
manner of doubtful services.
If we had it all to do over again; if
we had that money now, how would we
use it to create a “ bank-spirited public?”
T h e American Bankers Association is
ready to aid banking to formulate the
answer in practical cooperative assist­
ance toward putting sounder customer
and public relations policies into effect;
and not at a cost of anything like three
hundred million dollars a year.

Distributing Christmas baskets to the
needy
Distribution of seeds
Showering customers with calendars,
trinkets, and all sorts of gadgets.
Nevertheless, such practices as these
entered into the customer relations the­
ories and methods of many banks during
the Gorgeous 1920’s.
I do not believe that they did, or ever
could, help to make anyone bank-minded
or create a “ bank spirited public.”
Proper Methods

These practices probably did more
harm in respect to creating misunder­
standing in the public mind as to what
was really to be expected from a bank

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1934
CO NVENTIO N
N e b r a s k a Banker s
Association
L i n c o l n ,

November 8-9

T h e Executive Officers of the Associa­
tion and the Headquarters staff have
given consideration to the questions of
publicity, public relations and customer
relations for banking under the condi­
tions that have beset the banks the last
few years.
T hey have had before them from time
to time various plans for more or less
elaborate national campaigns of prop­
aganda, radio and public addresses, and
institutional advertising publicity, aimed
to modify the state of public mind in
regard to banking.
Each one of these plans has been giv­
en consideration. T h ey have been studied
from points of view of technical pub­
licity policy, of political, economic and
public psychological conditions, of time­
liness and their adaptability to internal
American Bankers Association policies.
Several checkings of opinion as to vari­
ous aspects of these plans were also made
among members of the Association.
In view of the relationship that had
developed between banking problems
and political conditions, it was decided
that a close coordination should be main­
tained between the publicity, or public
relations policies of the Association and
its other administrative policies under
the direction of the general executive
officers.
It was not felt desirable to have out­
side o f this executive group, as some
proposed, other secondary bodies for the
purpose of carrying out widespread ac­
tivities along lines of propaganda. There
was ample reason to believe that the
most powerful influences on public opin­
ion and sentiment were coming from
W ashington and that it was essential to
establish and maintain, so far as possible,
harmony of purpose with those forces in

8

Central Western Banker, October, 1934

bringing about a banking situation that
would ultimately command the confi­
dence and goodwill of the public.
It was accordingly determined to
bring about a complete identity in the
Association between its executive policies
and its public relations activities. T here­
fore, the executive officers— the presi­
dent, the first vice president, the second
vice president, who is also chairman of
the committee on federal legislation,
and the executive manager— were des­
ignated as the publicity committee of
the association to exercise full direction

over the publicity department as an ex­
ecutive function.
Aggressive Action

Under this committee the publicity
department is operating along a number
of lines. One is to work with the nation­
al officers in studying and formulating
policies and documents relating to con­
tacts with the administration at W ash ­
ington and proposals and suggestions for
amending the banking laws. These mat­
ters all play a part in laying the founda­
tion that should sooner or later make

East M e e t s W e s t
at O m a h a
(See Cover Photo)
r p H E original townsite of Omaha was
platted in 1854. Omaha was incorpo­
rated on February 2, 1857.
South Omaha, an independent city
until 1915, and six villages, Benson,
Florence, Dundee, Saratoga, Gibson and
Clontarf, are now included in Omaha.
Omaha has a commission form of gov­
ernment with home rule charter. It is
the county seat of Douglas county.
Industrial

Omaha is the second largest live stock
market and meat-packing center in the
world, with 7,500 persons employed di­
rectly by the combined industry.
Om aha’s
market
pays
producers
$500,000 daily and receives between 7,000,000 and 8,000,000 head of cattle,
sheep and hogs annually. Since its found­
ing in 1884, the Union Stock Yards has
received 265,690,279 head. M ore cattle
are trucked to Omaha than to any other
market.
Om aha’s fourteen packing plants an­
nually produce $150,000,000 worth of
meats and by-products which are shipped
all over the world.
Products of Omaha’s 430 manufac­
turing plants average $300,000,000 in
value annually.
Omaha is a leading grain market. T he
Omaha Grain Exchange, organized in
1904, has received 78,000,000 bushels
of grain in a single year. It has 200 in­
dividual members and 36 resident grain
firms.
Omaha mills have a daily capacity of
5,000 barrels of our, 1,800 barrels of
corn meal and 1,200 tons of alfalfa

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meal. Nebraska has 110 Hour and grist
mills.
Omaha makes more butter than any
other city in the world, averaging over
40,000,000 pounds annually.
Omaha has one of the w orld ’s largest
lead smelters.
Omaha-made ice machines are used in
40 foreign countries.
Omaha has four large breweries, cap­
able of producing 415,000 barrels an­
nually.
Ninety thousand workers in Omaha
normally earn $150,000,000 annually.
Public Utilities

W ith 58,716 electric service connec­
tions in homes and business locations, 99
per cent of Omaha’s population has elec­
tric service.
Omaha, with one telephone for every
3.5 persons, is seventh metropolitan city
in the world in number of telephones
per capita. T h e 65,000 telephones in
Omaha transmit 400,000 calls daily.
Headquarters of the Northwestern
Bell Telephone Company, operating in
five states, are in Omaha, as are division
headquarters of the W estern Lhiion and
the Postal Telegraph Company.
There are 50,983 metered water ac­
counts and 50,664 metered gas accounts
in Omaha.
Om aha’s municipal water plant has a
daily pumping capacity of 114,000,000
gallons. T h e filter plant has a 90,000,000-gallon capacity daily, and the four
storage reservoirs hold 44,000,000 gal­
lons.

possible more aggressive action tending
to improve the public attitude toward
the new banking structure that is emerg­
ing.
Another line of action which the pub­
licity department is carrying on is to sup­
ply in plate and mat form to about 6,000
papers simple, constructive, non-controversial articles about banking and sound
financial policies. Although these papers,
nation-wide in their distribution, are
largely in the country districts, many
are in the towns and cities.
Another aspect of the association’s ac­
tivity in the field of public opinion, and
one in which you are more specifically
interested, has to do with cooperation on
its part with banks individually, or in lo­
cal groups, dealing with public relations
in their own communities through their
own advertising. In recent weeks we
have taken a distinct new step in this
connection along lines that enable us to
utilize and capitalize some valuable ac­
cumulated experience, equipment and
contacts.
These projects are now centralized in
the advertising department, charged
with the responsibility of developing
broader advertising activities having to
do with all types of banking, under the
authority and supervision of the execu­
tive officers, rather than under any par­
ticular division. This arrangement, how­
ever, leaves full discretion as to special­
ized advertising, such as the trust and
savings services, in their respective com­
mittees. In addition, it permits an exten­
sion of the work of supplying to such
banks as desire it, a combined service of
advertising copy and pamphlets of both
general and specialized character for
which it appears there is a real demand.
Customer Relations

Some of you are quite familiar with
another line of work which the associa­
tion is carrying on in the field of custo­
mer relations. I refer to the so-called
“ Customer Relations Program” as out­
lined in the book, “ Constructive Custo­
mer Relations,” prepared by the Public
Education Commission in cooperation
with certain members of the Financial
Advertisers Association. T his program
is designed to promote better under­
standing and sounder viewpoints among
employees both in respect to their own
banks and banking in general. T h e book
comprises eight studies as a basis for
conferences to be held within each bank
under the direction of an officer to en­
hance the ability of employees in con(Continued on Page 12)

9

Central Western Banker, O ctober, 1934

Training Future Bankers
Through A . I. B.
Excerpts from the radio address of Honorable J. F. T. O'Connor, Comptroller of the
Currency, on the occasion of the commencement exercises last month of the American
Institute of Banking.
T IS an honor to have the opportun­
ity to extend felicitations to a group
of graduates whose educational ca­
reer has, in many respects, a unique place
in the scheme of American education.
T he education you have received is not
classical; it is practical. T he orthodox
schoolman may frow n upon educational
methods of the type you have experi­
enced, which he sometimes contempt­
uously lumps in the ad hoc category;
you nevertheless have the satisfaction of
knowing that you have immeasurably
increased your efficiency in your chosen
field.

I

Unlike the product of most education­
al institutions cast in the standard mold,
those who have graduated from the
American Institute of Banking are
already employed in banks throughout
the country. M any industrialists believe
that an individual should produce some­
thing of value while he is obtaining his
education, and some rather well-known,
though small, schools are conducted on
this principle. Industry, furthermore,
has felt the necessity of intensive train­
ing of men and women for their par­
ticular tasks in a manner not afforded
by the ordinary college or university.
Some of our large corporations have es­
tablished schools in connection with their
factories.
T h e Institute, probably the best
known of its kind in the field of prac­
tical education, has performed a valu­
able service in bringing into more inti­
mate relationship bank clerks and the
executives. W h ile
imparting
useful
knowledge, it has improved the morale
of the personnel and has stimulated in
its members an intelligent interest in na­
tional and international monetary prob­
lems. Its courses cover a wide field in
banking.
M any national bank examiners and
assistants have profited by the Institute’s
training and are among its graduates.

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M r.

0 ‘Connor says the need
for trained minds in the field
of banking is daily becom­
ing more necessary. A . I.B.
n o t o n l y gi ves technical
training, but supplies that
b r o a d e r busi ness vision
which bankers are going to
need to carry on
T he national examiners are selected aft­
er written examination and satisfactory
work as assistant examiners. Let me say,
they are a credit to the Treasury depart­
ment— efficient, tireless workers, courte­
ous— and not one has been dismissed for
cause during my term. Graduates of the
American Instiute of Banking may be
found in all branches of the comptrol­
ler’s office.
N o business can permanently prosper
on a philosophy of isolationist self-suffi­
ciency. T h e prosperity of one is depend­
ent on the prosperity of the other. T he
nation needs trained and flexible minds
in banking today, probably more than
ever before because of the sweeping
changes that have taken place in bank­
ing practice, and the constantly shifting
industrial scene.
Honest men admit that intolerable
abuses crept into banking practices. T he
better bankers did not approve, but were
powerless to prevent or correct them.
Bankers have no such regulatory boards
as many of the professions have estab­
lished. Evils must be corrected by legis­
lative action which could have been re­
moved by the bankers’ own regulatory
boards had they existed.

Past Experience

Past experience at home and abroad is
an invaluable guide. Conditions during
recent years are similar in some respects
to those of 120 years ago, follow ing the
Napoleonic W ars. T h e student of fi­
nance should be familiar with the major
economic and financial movements in
other countries, if he would correctly
understand and solve the problem in his
own. For instance, we had ample oppor­
tunity to study the results which fol­
lowed the abandonment of the gold
standard in December, 1929, and 24
other nations follow ed before the United
States took a similar step on M arch 6,
1933. In 34 years, England has aban­
doned the gold basis five times. T h e re­
sults of the devaluation of the franc to
20 per cent of its original value by
France before returning to the gold
standard, and the devaluation of the
Italian lira to about 25 per cent of its
original value, had an important and
well-known influence on trade and com­
merce.
W e cannot close our eyes to the mean­
ing of experiences of yesterday and their
disastrous consequences. If we are to
solve the problems of the moment we
must have trained minds.
Real Problem

T he real problem which confronts the
banker and the business man, then, is
not whether a mind can be trained, but
how to determine in advance of actual
trial whether a mind really has been
trained. A t this point we almost instinct­
ively turn to the schools, and institutions
like the Institute, for are they not the
logical places where the human mind ac­
quires habits and learns methods which
bring out and multiply its latent powers?
A high percentage of those holding aca­
demic degrees today are persons whose
minds are really untrained. T h e time
has passed, under our present non-selective method of admitting students to

10

Central Western Banker, O ctober, 1934

higher institutions of learning, when a
degree is any substantial guaranty of
true mental discipline and training. It
is too easy to “ get through” many of
our schools, if a student has a good
memory and a pleasing personality, to
make the certificate of graduation de­
pendable evidence that the holder has
trained his mind to function smoothly
and reliably in dealing with complex
problems. In short, the business man
must go behind and beyond the degree
and inquire into the actual record.
T h e intellectually trained man has
learned that there is a correct and an in­
correct way to apply the mind to a prob­
lem, and he selects the correct method.
Such a mind has learned that the first
requisite of sound thinking on and cor­
rect analysis of a problem is to clear the
mind of extraneous matters which may
bend the judgment, as scrap or junk iron
deflects the magnetic needle; it has
learned that in most, if not all situations,
emotion of every kind must be kept in
the background if a correct solution is
to be reached; in short, that facts, the
truth, are the only safe bases of human
conduct. Through habits of discipline,
acquired in the training process, such a
mind has learned how to divest itself of
disturbing and distracting emotions which
like high winds, drive the reasoning
power off the straight course that leads
to wise conclusions. It has learned the
value of facts; and how to take a prob­
lem apart, weigh its constituent ele­
ments, assign them their proper places in
the whole, and to put these elements to­
gether again in the form of a judgment
which, in the light of all the circum­
stances, is the best that limited human
foresight can reach. It has learned, to
put the matter differently, the arts of
discrimination and cold analysis which
keep off the scales all irrelevant consid­
erations; it understands the supreme
importance of shifting relevant from ir­
relevant facts. T h e trained mind knows
that nothing endures unless it is founded
upon eternal principles, the principles of
justice, of fair play, of equal and nondiscriminatory treatment without regard
to persons.
Social Doctrines

Let us not forget that during the last
fifty years the American public has spent
hundreds of millions of dollars in teach­
ing the youth of America certain legal,
economic, financial, sociological and in­
dustrial theories and doctrines, all on
the assumption that they were sound
and were the natural deductions from
and represented a correct interpretation

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of human history. W e are still teaching
these doctrines and theories in our
schools at public expense. If the men
who teach these doctrines because they
are specially trained and skilled in them,
are justifiably maintained at public ex­
pense to impart this type of education to
our young people, why should not men
for the time being charged with the re-

1934
CO NVENTIO N
N e b r a s k a Banker s
Association
L i n c o l n ,

November 8-9
sponsibility of government, national and
local, call these experts to their aid and
have the benefit of their specialized
learning in these doctrines and theories
— governmental, economic, financial and
political? A re their teachings false? If
they are false, the people of America
have wasted hundreds of millions of dol­
lars. If they are not false, they are
worthy of use and reasoned application
in connection with the administration of
public affairs. T h e time and the opportuity are at had to put them to the test.
Great crises confront our Government
and can be solved only by the applica­
tion of good judgment, of well trained
minds to their solution. If the doctrines
and theories which we learned when we
were students, which our fathers and
grandfathers learned before us, which
children are learning today, prove false
or unsound when put to the practical
test, no better time than the present ex­
ists for finding it out. W e know noth­
ing in this country which it is wiser and
better to try than the teachings which
our fathers and ourselves have bought
and paid for.
Trained Minds

T h e need of trained mjnds in the
banking field is becoming increasingly
plain. T h e problem of credit, appraisal
of assets as a basis of credit, the separa­
tion of depository function from the
purely commercial long term loan func­
tion of banks, investment counsel to pa­

trons and the like, demand the best
trained minds for a proper solution. T he
time is coming when the banker and you,
the responsible bank employee, will be
regarded more as professional than busi­
ness men. T h e banker of the future will
be especially trained for the practice of
his vocation, and, as time goes on, that
training will give him more and more
the status of a professional man. This
tendency is in evidence now and inevit­
ably will become stronger. O ut of the
recent crisis, out of the great depres­
sion which has paralyzed business and
finance the world over, will come a
clearer realization that the business of
banking calls for not only the best train­
ing available, but for a highly specialized
type of training. W ith the lawyer, the
doctor, the engineer, the accountant,
and others who might be mentioned, the
banker of the future w ill be a true pro­
fessional man. As that time comes, a
code of ethics for bankers w ill evolve,
supplementing but more powerful than
the criminal law. T h e standards of the
profession will rise rapidly, it will purge
itself o f corrupt and evil members, and
the public in dealing with them w ill feel
a security founded on the solid fact that
no man can claim the honorable desig­
nation of banker until he has met cer­
tain well-known and high standards of
ability, training, and character.

Regular Dividend
A t the meeting of the board of di­
rectors of T h e Northern T rust C om ­
pany, Chicago, the regular quarterly di­
vidend of 4
per cent was declared
payable O ctober 1, 1934, to stockholders
of record at the closing of the books
September 21.

What W ould You Do
W ithout Metals?
H ere’s one way to gain an idea of the
necessity of mining— look around your
home and list the articles in it which are
made wholly or partly of metals, or to
whose manufacture metals contributed.
Y o u ’ll soon tire of the game, inas­
much as practically everything you use,
luxury or necessity, would go onto that
list. From lamps to silverware, from
medicine to transportation, from jewelry
to cooking utensils— metals run the en­
tire gamut. T h a t’s why mining is one of
the two or three basic industries upon
which civilization depends for its very
existence.

11

Central Western Banker, O ctober, 1934

Keep The Government O u t
of the Public U tility Business
Every holder of public utility bonds should be aware of the serious
situation when g o v e r n m e n t officials favor the use of public
money to develop competition with existing properties
construction
of utility plants which duplicate
those already in existence and
privately owned, is opposed in a report
by the Committee on Public Utilities of
the National Association of M utual
Savings Banks, meeting in annual con­
ference. T h e report said in part:

G

o v e r n m e n t a l

“ One of the most constructive things
which could be done by the utility com­
panies themselves— not only to create a
better market for their bonds, but also
to develop a better impression in the
mind of the public— would be to adopt
a comprehensive and uniform system of
accounting practice. W e are all familiar
with the uniformity of accounting adopt­
ed by the I.C .C . as applied to steam
railroad companies. A ny one of us can
take a report of a steam railroad and im­
mediately be in a position to compare the
break-down items of such report with
those of any other railroad. It seems en­
tirely reasonable that public utility com­
panies through their associations and
with the cooperation of the proper pub­
lic commissions, should develop a stand­
ardized method.
Sinking Fund

“ T h e next point is to develop better
sinking fund methods. T his would per­
mit public utility bonds to be retired at
a more uniform rate and would also
provide for a more consistent and steady
market due to sinking fund operations.
“ M onthly or at least quarterly sink­
ing fund purchases by the trustee would

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help to steady the market. T h e method
of fixing a certain day or week in which
sinking fund operations must be con­
ducted results in erratic price fluctua­
tions and tends to create an artificial sit­
uation.
“ T h e idea of shorter average maturi­
ties for public utility bonds carries great
appeal. T h e remarkable stability of price
shown by the shorter maturities of high
grade public utility bonds during the
last four years is too impressive to be
overlooked.
“ As values of every kind tend to de­
cline, it is impossible to expect that
many existing utility rates will escape
criticism. By and large, the tendency of
rates of the best of our operating com­
panies have been downward for a period
of years.
Operating Costs

“ W e must bear in mind that under
the general recovery program, operating
costs tend to increase while, at the same
time, pressure is exerted to reduce rates.
Such a situation eventually could destroy
the earning power of the best properties.
W e must keep abreast oE,these tendencies
and use our influence to help promote
fair and equitable decisions.
“ T h e likelihood of further heavy tax­
ation laid upon the utilities is quite un­
derstandable, and perhaps is due to the
very fact that public utilities render such
a necessary service that in almost all
cases the operating companies have been

able to report earnings throughout the
depression. T h ey have held up better
than those of any other major industry
with the natural result that this source
of additional tax revenue is being in­
creasingly levied upon.
Duplications

“ By far the gravest problem which
confronts not only this organization but
every large investor in public utility
bonds, is the serious situation brought
about by the attitude of governmental
officials who favor the use of vast sums
of public money in developing plants
which duplicate existing properties and
jeopardize the safety of securities.
“ N o attempt will be made here to
itemize the projects brought before the
various lending corporations in W ash ­
ington, which would more or less dupli­
cate already existing public utility facili­
ties throughout the country, but the list
is impressive and the amounts of money
involved run into gigantic sums.
“ A n example of justifiable apprehen­
sion is the possibility of duplication at
public expense of adequate facilities al­
ready existing in a city in Tennessee.
“ It is not our function as savings
bankers to oppose governmental develop­
ment leading toward public ownership
of public utilities. It is, however, our
right and our duty to insist that such ac­
tion be accompanied by either the pur­
chase of existing facilities at a fair price
or payment of just compensation for the
resulting losses to bona fide investors.”

12

Central Western Banker, O ctober, 1934

Large Investments in Property

T h e criticism aimed at the Union
Credit Service association of Lincoln,
Nebraska, is unfair, and some of the
statements made disclose the fact that
the informer had evidently not been
properly informed. Referring to the con­
tract between the Union Credit Service
association and the local associations, it
may be news to this banker that it is op­
tional with each association as to the
number of years this contract shall cov­
er. If preference is given to a five year
contract the associations have the priv­
ilege of specifying this in the contract.
T he statement that the services ren­
dered amount to nothing casts a reflec­
tion on the good judgment of all those
who voluntarily have signed these con­
tracts within the past few months, and I
would not undertake to say that bankers
are the only class who exercise good
judgment.
Personally, I am not con­
nected with the Union Credit Service
association, but do possess some knowl­
edge of their purpose, which is to or­
ganize co-operative credit associations
and use their best efforts in keeping them
sound, and help them function in a way
which will make them an outstanding
success in their community.

Unfair Criticism

p iV E

years of economic readjustment

have wrought many changes in the
financial and social order, but the aver­
age man still holds substantial property
investments, Frazier Jelke & Co. show
in the firm’s current Investment Survey
of life insurance and savings bank hold­
ings.
O f the 93,249,042 life insurance pol­
icies in force with forty-four principal

“ Prosperity neither seeps d o w n
through the social structure from above,
nor rises to the capitalist from the av­
erage man below. Simultaneously, it
moves in or out of the whole warp and
w oof of the economic fabric. T h e pos­
sessors of great wealth cannot be har­
assed without injuring the average man.
There is no clash of interest. In the last
analysis, what helps the capitalist helps
the average man.”

companies, the average face value is ap­
proximately $1,100, and it is estimated
that about 65,000,000 persons carry in­
surance,

behind which

there are

ad­

mitted assets of $18,227,686,544. Point­
ing out that the person insured is es­
sentially a capitalist, the survey shows
that insurance funds are invested in real
estate to the extent of about 37 per cent
of admitted assets and in obligations se­
cured by governmental credit or by cor­
porate properties to the extent of 36 per
cent.
Each of the 13,686,947 savings bank
depositors has an average of about $700
with total deposits amounting to $9,720,377,072, the survey continues, cit­
ing the fact that N ew Y ork state’s 138
savings banks hold real estate and mort­
gages to the extent of $3,562,095,000 in
addition to $1,853,702,000 bonds of gov­
ernmental divisions and corporations.
“ Policyholders and savings bank de­
positors have been educated to believe
they may withdraw their savings in cash
at any time,” the survey says. “ For this
reason they seldom are conscious that
their funds are not held in cash, but in
fact are invested to earn the interest al­
lowed at regular intervals. T hey are not
likely to realize how political policies
and economic conditions may influence
the value of the resources in which their
savings are invested, or the credit stand­
ing of those who have borrowed indirect­
ly from them.
“ T h e average citizen who under­
stands how closely security is linked
with the welfare of mutual financial in­
stitutions has ample cause for demand­
ing assurances of protection for reason­
able property rights, and he should know
that his elective representatives in fed­
eral, state and municipal assemblies h\ave
the power to re-establish confidence.

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HOW CREDIT ASSOCIATIONS
O PERATE IN N E B R A S K A
(Continued from Page 6)

signments are not issued against share
deposits, neither are checks issued against
capital stock in a commercial bank.
T h e banker who made the statements
in this recent article seems to be willing
to accept any check, although there is
always the possibility of the check be­
ing refused by the payee bank for vari­
ous reasons. W here is the banker who
has not had hundreds o f checks returned
to his bank unpaid, bearing notations
“ insufficient funds” , “ payment stopped” ,
“ account closed” , etc. T h e checks I am
referring to were drawn on commercial
banks and were the regular check form.
Y ou bankers have all had them, so have
I, through my twenty-one years of bank­
ing experience in a commercial bank.
T h e procedure of collecting the proceeds
of an assignment would be just the same
as collecting the proceeds of a regular
bank check. Just where would the dif­
ference be?

Another unfair statement is made to
the effect that E. H . Luikart, superin­
tendent o f banking of the State of N e­
braska, is secretly interested in the
Union Credit Service association.
He
may be interested to the extent that
every community should have banking
facilities, and only the selfish feel other­
wise, but aside from this, I know M r.
Luikart as a man who tries to be fair
and impartial in all matters pertaining
to banking.

A " B a n k - S p i r i t e d " Publi
(Continued from Page 8)

tacting the public. T h e foreword says:
“ T h e process of forming an intelligent
public opinion on banking begins with
the proper training of the bank staff in
the handling of their patrons and cus­
tomers.” As you can see this is in har­
mony with the tenor of the advertising
service just described.
Service

I defined the bank of which I am
speaking as a place where people bring
their money and leave it with the un­
derstanding that the banker has the priv­
ilege of Ipaning and investing this money
at a profit and that, for this privilege,

the bank owes to the depositor some
very definite things in return. I said
that the distribution of gifts and un­
bank-like services, or the rendering of
“ necessary services” at a loss, are not
things that the bank owes the depositor
in return for using his money; nor do
such things aid in building up “ a bank
spirited public.”
W h at then should the bank offer?
T he answer is inherent in bank opera­
tions themselves.
Is it not true that when a bank ac­
cepts deposits, it assumes obligations of
trustee to safeguard the funds with all

13

Central Western Banker, O ctober, 1934

possible diligence ? W h en

deposits are

accepted there immediately comes into
operation in behalf of the depositor all
the bank’s physical facilities, experience,
and legal requirements — an array of
safeguards that can be found nowhere
else.
W hen a bank handles a community’s
deposits, the cashing of its checks, the fi­
nancial arrangements connected with the
interchange of its products and services,
the paying of its multitudinous bills, the
accumulation of its savings and the loan­
ing of money to its constructive business
enterprises and public requirements, it
thereby renders indispensable economic
service to the people in its community.
Does this, therefore, not constitute one
of the m ajor returns which a bank gives
to its depositors for the privilege of loan­
ing and investing their money at a prof­
it? Every depositor directly or indirectly
as a business man or a resident in his
community benefits from the economic
and social progress which these banking
functions make possible.
W h en a citizen in a bank’s communi­
ty places his funds on deposit, is it not
true that the increase mobility and econ­
omy, which banking facilities give his
money, substantially enhance its real
value to him because of its increased util­
ity ?
Is it not true that the highly de­
veloped technical equipment, scientific
methods and inter-bank cooperative re­
lationships existing in the American
banking system enable it to perform
these services and many others with the
maximum of efficiency and minimum
cost ?
Finally— not to take your time fur­
ther in mentioning innumerable services
which the banks inherently render in re­
turn for deposits — is it not true that
honestly and skillfully managed banking,
through employing these deposited funds
profitably for itself and at the same time
so as to defray the cost of the banking
mechanism to the public, renders the
people
economic
services
obtainable
through no other channel?
These are merely suggestions as to the
type of messages which should be given
both to the banking and the general pub­
lic. O u r theme should deal consistently
with the essential line of service all
sound banking inherently render the de­
positor and the public.
Facts, such as I have cited, can be
simply to ld ; and in a way that the pub­
lic w ill know that banking is not made

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Federal Reserve Bank of St. Louis

safe through laws and political inter­
ference, but through honesty and skill
in management under private initiative.

000,000,000. T h e national income had
sunk to the abnormal low of about $60,000,000,000. A t that ratio taxes re­

Properly told messages embodying
this philosophy of banking constitute the
best sales argument not only to get cus­
tomers into the bank but to get them
into the bank in the right frame of mind.

quired 33 per cent of it, said J. B. John­
son, Vice-President of the Ohio Public
Service Co., Elyria, Ohio.
In brief, the cost of government has
risen 700 per cent while the national in­
come has risen less than 100 per cent.
T h e probability is that figures for 1934
will show still further distortion of the
relationship between income and cost
of government.

THE TIM E TO A D V E R T ISE
(Continued from Page S)

permanently. T hey believe that now,
with daylight here after darkness, is the
time of all times to advertise— not for
deposits, not for loans, but for public
understanding, good will, faith, confi­
dence, hope and expectation for the years

Flere is one of the main reasons why
we are finding it so difficult to effect re­
covery. M oney that, if taxation were
reasonable, would go for jobs, dividends,
purchasing of supplies and industrial ex­
pansion, goes instead to government. It
is kept out of the normal channels of
trade. Bureaucracy eats it and grows
fat— business starves.

ahead.
If we expect to stay in business, our
reputation means more than immediate
sales. If we are a good, sound, reliable
house, we can build permanent good will
and the finest lines of business, by the
right kind of advertising. And these of
all times are opportune.

Based on the above estimate, one-third
of the average family income is now
taken to pay the cost of government, di­
rectly or indirectly. T h e price of every­
thing purchased, from a lead pencil to
an automobile, is made higher because of

When Industry Starves
In 1913 the cost of all governments
in the United States was slightly under
$3,000,000,000. T he national income
was $35,500,000,000. Taxes thus took
around ten per cent of our earnings. In
1933, according to a recent estimate,
the cost of government was about $20,-

the tax burden.
T h e seriousness of this problem can­
not be overemphasized. W e are reaching
the point where government must adjust
its cost to a reasonable percentage of the
national income, or business w ill con­
tinue in the doldrums.

G M A C SHORT TERM HOTES

available in limited amounts
upon request

G eneral
A cceptance

M otors
C o r p o r a t io n

Executive Office " Broadway at 57th Street " H ew ToA , H ■ T.
OFFICES

IN

P R I N C I P A L

CITIES

14

Ceìitral Western Banker, O ctober, 1934
cannot do it if it is starved for funds.

More BusinessLess Profit???

stimulate
statistics

utilities today is not
demand for power.

Recent

show that consumption,

for

both household and industrial purposes,
This is going on, however, without
profit to the utility in most cases. Rea­
son : Taxes, regulatory and other ex­
penses are increasing so fast that they
outrunning

even

substantial

Farm Income

A Hard One to Answer

T h e drought wiped out the crops of
some of our richest farming states— but
the national farm income this year will
total up considerably more than last.
Reason for that is the sharp rise in the
value of what crops remain. Corn will
which constitute the bulk of the farm
income, will bring in $700,000,000 more
than they did in 1933.

T h e editor of the W ild er, Idaho,
Herald says: “ T h e point that is worry­
ing ye editor is why our government
should want to enter into any more busi­
ness ventures at the expense of the tax­
payers.
“ W e believe that if our lawmakers
would exert more effort in reducing
taxes and less in meddling with legiti­
mate business, we would all profit
thereby.”

directions stops and more ex­

results.

how to

is rising steadily.

are

T h e electric industry has always been
able to finance its developments at low
interest rates because its securities have
been regarded as conservative and safe
investments. If we make the utilities
profitless, they cannot get capital. Rea­
sonable profits are indispensable to the
best interests of the power users, as well
as investors.

in all

pensive and inferior service to the pubilc

T he greatest problem faced by private
electric

from 20 to 25 per cent— about $1,500,000,000. Standard Statistics believes the
rise will amount to $2,000,000,000.
Government experts unofficially say that
the increase w ill be around $1,000,000,000. Thus, there is considerable differ­
ence of opinion at to how much more the
farmer will have to spend when 1934
closes— but every agency is certain his
pockets will be better lined than before
— and principal credit for this improve­
ment in the financial condition of the
great majority of farmers goes to old
M other Nature’s system of adjusting
supply and demand.

W ithout reasonable earnings, progress,

in­

creases in gross operating income.
T hat is a menacing situation. Unless
it is soon corrected it will do irreparable
harm not only to utility investors but to
utility customers. For twenty years the
cost of power has been declining due to
the industry’s intensive and continuous
work in opening up new territories and
finding new customers and in developing
better
generating
and
transmitting.
T h e industry is struggling to continue
that work and to effect further re­
ductions in charges for power— but it

Dun and Bradstreet forecasts that
the increase in total farm income w ill be

I t is the constant pur-

1

pose of this bank to
transform an otherwise routine business
connection into a mutually

profitable

and

pleasant relationship.


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

C o n t in e n t a l
•

N a t io n a l
a n d

T rust

I l l in o is
Ba n k

Com pany

o f C H IC A G O

15

Central Western Banker, O ctober, 1934

INSURANCE
Its

Application to thelòanhìng Traternity

A nswering
PRESENT D A Y O B J E C T IO N S
By IRVIN BENDINER
H E I N S T I T U T I O N of life in­
surance in the past five years has
merited and received the confi­
dence of the public. But has the agent
for himself developed that degree of
self-confidence in himself and his insti­
tution which makes him regard the fu­
ture with an increasing optimism and
makes him regard the present as an op­
portunity for achievement?

T

T o the individual agent, nothing can
be as helpful in a program of construc­
tive thinking as a further development
of his confidence in his own ability to
render a high type of intelligent life in­
surance service to his clients.
Present-day sales efforts require in­
telligent effort. The public will listen to
any presentation which provokes and
stimulates thought. What effort is the
life insurance man making to stimulate
the average man to think of his problems
and to provide a sound method to solve
those problems? If the life insurance
man himself is floundering because of
objections raised by the public, it is ob­
vious that the life insurance man cannot
suggest a solution to the public.
Solves Problem of ‘Uncertainty’

One of the objections to life insurance
today is the “ uncertainty” of the future.
And yet, the more “ uncertain” the fu ­
ture, the greater the need for life insur­
ance, and the greater the opportunity
for the life insurance salesman who w ill
recognize, in this objection, the largest
possible service that life insurance can
render.
W ere the average man able to pre­
dict with certainty, economic, social and
financial trends, he could in some meas­
ure meet the problems of life without
life insurance. It is, in truth, the very
uncertainty of the economic problems of
life, as well as of life itself, that gives

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Federal Reserve Bank of St. Louis

Philadelphia Clearing House
to life insurance its great field for de­
velopment.
T his objection can be turned into a
valid sales argument if the fieldman vis­
ualizes life insurance as an offset to pos­
sible inflation, as a means of stabiliza­
tion, and as practical a solution as one
can get to insecurity.
Business w ill not and cannot improve
for the average underwriter until he
does. H e is spending too much time and
effort in trying to find prospects, with­
out recognition of the fact that most
prospects are form ed rather than found.
T h e effort of the life insurance man to
form and build a prospect file will more
than repay the effort, not alone in finan­
cial remuneration but also in the satis-

\Ar. BENDINER says that today’s
ife agent s h o u ld v is u a liz e th e
>olicy he is selling as a contract
vhich carries present day benefits.
He thinks many p r o s p e c t s are
iware only of remote benefits. He
also suggests some unusual
approaches

faction of developing a plan of action
which he can successfully use.
Is the life insurance man of today vis­
ualizing the policy he is selling as a con­
tract which carries present-day benefits,
as well as benefits which meet the haz­
ards of retirement, emergency and
death? A life insurance policy brings to
its owner a present-day sense of security,
present-day peace of mind, present-day
optimism, a present-day plan of savings

and thrift, and present-day safety for
the modest moneys he is able to set aside.
Are not these present-day benefits of
life insurance sufficiently tangible and
imposing to meet the arguments of the
public as to the remote benefits of life
insurance? And is it not proper to in­
quire if the life underwriter realizes and
uses the present-day protection of life
insurance as the basis of a selling plan ?
Some Unusual Approaches

W ith a view toward presenting some
ideas which may be thought-provoking
as well as in answer to some present-day
objections, there are set forth below a
few approaches which may have appeal.
1. Y ou have a picture of your daugh­
ter on your desk. M ay I present one of
your daughter ten years from now ?
2. W o u ld you be interested in insur­
ing the enjoyment of life by your whole
family at no greater cost than protect­
ing yourself ?
3. W ou ld you be interested in a plan
by which your business in the event of
your death could be sold at your own
price with cash guaranteed ?
4. If you are able to save as much in
the next five years as you did in the last
five years, where w ill you be five years
from now ?
5. If price-fixing and business regula­
tion under the N R A were carried to the
extreme of measuring the usefulness of
men, and a code book were brought out
on the trade-in value of used business
men, what price class would you be in?
6. T h e only effective reply by a pros­
pect to a life insurance man is a program
of life insurance which satisfies every
economic need of the prospect. W ou ld
you be interested in such a plan to an­
swer effectively all of your problems?
7. M y plan cannot make you wealthy
in dollars and cents now, but it w ill

16

Central Western Banker, O ctober, 1934

make you rich in contentment and the
satisfaction that your responsibilities are
met, regardless of what happens to you.
8. Have you thought of the premium
that you pay, in terms of worry and
fear, for not facing the future with life
insurance ?
9. M any have talked to you of the
services of annuities in meeting the prob­
lems of advancing age, but do you real­
ize that an annuity may “ keep you from
getting old ” ?
Selling the ‘Institution’

10. I represent one of the unique in­
stitutions in the world. It has paid out
to its policyholders and their beneficia­
ries more than it has collected from
them, and built up an enormous sur­
plus and confidence which permits it to
make an unusual offer to you. It will
sell you an “ immediate cash estate” of
such amount as you determine. It will
permit you to pay for it on the install­
ment plan, and provide that if you die
before you complete the payments, it
will administer this estate, provide for
your obligations, save you taxes, keep
your brother-in-law from getting his
hands on the money, give your wife
enough to live on, educate your young­
sters, keep their home for them, liquid­
ate your business, make your youngsters
proud of their Dad and see to it that
you are remembered.
T he only danger you run is that if
you live, it will return to you money at
the time you will need it the most and
make you regret that you didn’t have
more. . . .
T he d'fficulty, agents say, is that they
cannot find the people who want these
things done.
T h e thought is ventured that the fu ­
ture of the life insurance man lies in a

recognition of the problems of the day,
and a conviction that these problems
may be solved if the enthusiasm of the
salesman will take him to the prospect.
As life insurance men and women you
have before you an opportunity and a
responsibility. Long since, you have been
admonished never to do anything unless
and until you believed in it.
D o not sell life insurance if you do
not believe in it. D o not stay in the life
insurance business if you do not believe
in it. But if you do believe in it, why
not do something— and in order to do
something, realize, in the vernacular of
the day, that you must “ go and see
’ em” ?

Fire Prevention Week
Comes Again
Between O ctober 7th and 13th— Fire
Prevention W eek w ill be observed
again. T h e week, which has become a
national custom, will be formally ini­
tiated by proclamations by the President,
governors of states, mayors of cities and
other prominent persons in public and
private life.
During the week every citizen will
have a splendid opportunity to learn the
fundamentals of fire prevention and con­
trol. Through speeches, newspaper and
magazine articles, exhibits and other
means, an intensive effort w ill be made
to enlist the citizen’s interest. H e can
blame no one but himself it he fails to
learn.
Fire prevention is a civic duty which
every citizen owes to himself and to
every other person. W e all pay for fire—
we pay for it in lost business, destroyed
jobs, higher taxes and insurance rates.
O n the average, each family contributes

Y a l e v a r ia b l e d e l a y
PERIOD DAY TIMELOCK
The timing of the Yale Day Timelock is controlled by two
11-jewel movements of marine-chronometer quality, which
are automatically wound, stopped, and started. These move­
ments are independent; either one is capable of controlling
the lock. This feature assures long life and freedom from
trouble. Especially designed for Yale Day Timelocks, the
movements are the last word in accuracy and dependability.
SOLD BY . . .

F. E . D A V E N P O R T A C O M P A N Y


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

O F F IC IA L E X P E R T S F O R N E B R A S K A

BANKERS

OMAHA, NEBRASKA

ASSN .

$4 a year as a tribute to M oloch — dol­
lars which are destroyed as surely as if
we tossed them into a stove. W orse still,
three people— two adults and a c h i l d out of each 39,000 of our population,
are sacrificed to the pagan god— because
we are ignorant and careless when it
comes to fire.
In the past, it has often been the ex­
perience that fire losses dropped during
the week and for a short period there­
after, only to rise again as the public
gradually f o r g o t
the information
gleaned. This year we should look for­
ward to the week and devote a little
time during it to really learning the fun­
damentals of fire prevention, then re­
member and practice them in the fu­
ture.

Government Behind
Home-Building
T h e next major activity of govern­
ment w ill be an attempt to stimulate
heavy industries— which normally pro­
vide the bulk of employment, were hit
hardest by depression, and have been the
most lethargic in recovering from it.
And the first step in doing that w ill be
to unloose capital for home-building and
repairing, through Federal guarantees
of mortgages. M r. Roosevelt has sent a
special message to Congress to expedite
such legislation.
Experts estimate that it is possible to
unloose credit to the tune of $1,500,000,000 or more in this manner. T hat money
would go to painters, carpenters, masons,
plumbers, contractors. It would buy ce­
ment, steel, paint, lumber, roofing, elec­
tric fixtures. It would pass through a
hundred great industries, creating jobs
and opporuntities as it went. It doesn’ t
take much imagination to visualize the
extent of its influence in pulling busi­
nesses of all kinds out of the doldrums.
H ere’s a thought for the wise prop­
erty-owner to start considering right
n ow : If building is greatly accelerated,
prices for everything involved are go­
ing to rise. T h e y ’ re going to leave de­
pression levels behind and return to the
normal average— that, in fact, is one of
the cardinal aims at this time. Those
who can afford to repair and build now
have an opportunity that may never be
repeated in their lifetimes.

17

Central Western Banker, O ctober, 1934

W I L L I A M IS. H U G H E S , S e c r e t a r y
N e b r a s k a lS a n k e r s A s s o c i a t i o n

E . E . F L A C E K , P r e s id e n t
N e b r a s k a lS a n k e r s A s s o c i a t i o n

fu ll,.... ...................................... unni................ ............................................................ ............................................................. ........ lim im i..........iin in in.....in...... .......... ....................................................................................................................... m ulini......................m in........................................ .

Donates Land
G w yer H . Yates, president of the
United States National bank, Omaha,
has donated 4.74 acres of his farm near
Peony park on W est D odge street to
the county, to be used as a right of way
in connection with the improvement of
the highway.
In the event the ground is not used
for road purposes, then it shall revert
back to the donor, the county board
agreed.
M r. Yates, members of the board
said, is the only property owner along
the proposed route to donate property.

its at W ashington, D . C., the First N a­
tional bank of Scribner was notified that
its application for contract of insurance
was approved and authorization given
to extend property modernization credits
immediately according to regulations of
the federal housing administration.

County Meeting
T h e bankers of Saline county were in
Wilber recently and held a very inter­
esting meeting at Sokol hall. A fter talk­
ing shop for an hour or so they went to
the W ilb er Diner where they were
served barbequed hamburger sandwiches.

Banker Dies

Wed in Omaha

C. W . W agner, 56, former Giltner
resident, died last month at Grand Is­
land. He had been ill more than two
years.
Funeral services were held at Grand
Island, and the body was taken to M c ­
Lean, 111., for burial.
Formerly a banker at Giltner, W a g ­
ner moved with his family to Grand
Island in 1923 and became district man­
ager of the Northwestern M utual In­
surance Co.

Ben Evans, for many years president
of the First National bank at Decatur,
Neb., and M rs. Ida Hanson, also of
Decatur, were married in Omaha re­
cently in the L og Cabin room of the
Y .M .C .A . Rev. R. W . T aylor officiat­
ed, using the ring ceremony. T hey will
live at Decatur.

Talks at Schuyler
J. F. M cD erm ott of Omaha, vicepresident of the First National bank of
Omaha, was the principal speaker re­
cently at the Chamber of Commerce in
Schuyler. M r. M cD erm ott gave a talk
on money and inflation, tracing the his­
tory of money to the present time. H ar­
ry Byrnes of Omaha also spoke briefly.
Preceding the speaking the regular
business session was held and plans
were discussed for the Fall Festival to
be held in Schuyler.

Housing Loans
In a telegram received from Roger
Steffan, director of modernization cred­

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Federal Reserve Bank of St. Louis

Meet in Wayne
Nine bankers of the region were rep­
resented recently in a bankers’ dinner
meeting at W ayne. T h e number in­
cluded men from W akefield, Hartington, Randolph, Laurel, Pender, Belden,
Coleridge and two W ayne banks.

Co-operative
L. W illie, vice-president of the C o­
operative Credit Association of Lincoln,
and H . M eyer, a representative, were in
W inside recently trying to interest lo­
cal business men in organizing a co-op­
erative bank.
These banks are started with a capital
of $1,500 and each depositor auto­
matically becomes a shareholder at the
rate of one $10 share for every $100
deposited or fraction thereof.

Building Loans
T h e two W ah oo banks have an­
nounced their complete co-operation
with the Federal Housing A ct by mak­
ing loans for modernizing business and
home property under the federal housing
administration.
It opens the way for one of the most
hopeful projects of recovery and offers
a means for reviving the basic building
industry with all its allied branches. It
w ill put many laborers back to work. It
will stop the decay of property through
lack of paint and repairs which has pro­
ceeded during the depression and will
assist in getting the piled up deposits of
banks into the channels of industry and
into circulation.

Convention Plans
Several of the nation’s foremost in­
dustrialists and financial authorities are
scheduled to address the annual conven­
tion of the Nebraska Bankers association
in Lincoln, November 8 and 9.
Acceptances have been received by the
committee in charge from W , J . Cum­
mings, chairman of the board of the
Continental Illinois National Bank &
T rust company, Chicago; Charles S.
M cC ain, president of the United Light
& Power company of Chicago and for­
mer chairman of the board of the Chase
National bank, N ew Y o rk ; Phil S.
Hanna, editor of the Chicago Journal
of Com m erce; J. F. T . O ’Connor,
comptroller of currency, W ashington;
L. E. Phillips, president of Phillips Pe­
troleum company, Bartlesville, Okla.,
and a director of the federal reserve
bank at Kansas City, are other headline
speakers.
Negotiations are also underway to
have Ralph Budd, Burlington president,
and Fred Sargent, president of the
Northwestern, on the convention pro­
gram.

18

Central Western Banker, O ctober, 1934

T h e convention w ill be held the two
days preceding the Nebraska-Pittsburgh
football game and it is expected that
many of the outstate bankers will stay
over for the contest. T h e general com­
mittee in charge is composed of Carl
W eil, Stanley M aly, E. N . Van Horne.

Dies in W est

Interest Reduced

have been done without charge, as a
courtesy to depositors and borrowers.
Since Chairman G . W . Derry of the
county organization has retired from the
banking business, E. C. Davenport has
been acting chairman, and F. L. C ol­
burn is secretary-treasurer. H . L. Sev­
erns of Cody and H . F . Campbell of
Kilgore were the out-of-tow n bankers in
attendance at this meeting, Merriman
being unrepresented.

Omaha banks will reduce the rate of
interest paid on savings deposits and cer­
tificates of deposit to a maximum of 1Jd
per cent beginning O ctober 1, W . B.
Hughes, secretary of the Omaha Clear­
ing House association, said. M ost banks
did pay 2 per cent.
T h e action was agreed upon at a
meeting of the Clearing House associa­
tion.

A . V . Kouba, 72, former president
of the Verdigre, Neb., State bank, and
one time resident of Omaha, died re­
cently at the home of a daughter in
Santa Barbara, Cal. He was one of the
organizers of the W estern Bohemian
fraternal lodge.
H e leaves a son, Richard, and another
daughter, M rs. F. J. Kulhanek, of Om a­
ha.

Dividends

A Year Ago

Checks amounting to $30,103.96 and
representing 20 per cent have been
mailed to depositors of the closed W in side Citizens State bank. This is a sec­
ond dividend, the first being 25 per cent,
and brings the total paid to 45 per cent.

Re-opened

Accept Applications

Scribner’s main street hailed with
welcome banners and flags the re-open­
ing of the First National bank on an
unrestricted basis. Floral offerings from
city banking houses and other business
institutions brightened the interior of
the bank. Banks officials from Fremont
and Omaha also called to offer con­
gratulations and best wishes.

T he First National Bank of H oldrege w ill receive applications of Phelps
county people who wish to apply for
credit to make housing improvements
under the Federal Housing Act, which
was passed by the last congress and was
recently signed by President Franklin
D . Roosevelt.
An amount from $100 to $2,000 may
be asked for improvements on any one
property, depending upon the applicant’s
income. A ll applications received at the
local First National Bank w ill be re­
ferred to the district supervisor, who is
G uy H . Harvey at Sioux Falls, S. D .
Holdrege is in the ninth region. T h e
state F H A director is Richard L. M e t­
calfe of Omaha.

A year ago arrangements were com­
pleted for the purchase of the Bank of
Paxton from its former holders and the
present board of directors took charge.
T he present officers of the bank, Carl
Hendricksen, president; Pete Eginton,
vice-president; H . F. Stoll, director, and
John Doherty, cashier, have successfully
managed the bank through a most dif­
ficult year.

County Meeting
Members of the Cherry County
Bankers’ association met in Valentine re­
cently for a conference. It is understood
that the chief topic for discussion was a
schedule of charges to make the public
pay for the various duties performed by
the banks, many of which in the past

Offering to Banks of Nebraska

Co-operative
Arrangements are completed for the
organization of the Chester Co-opera­
tive Credit Association, and when this
association is ready to operate, the state
banking department will refund the
money on deposit in the present Chester
State Bank, and this bank will cease to
function.
D uring the period the present bank
has been in operation, dividends amount­
ing to 50 per cent have been paid to de­
positors of the old Chester State Bank.
T h e banking department will appoint
a receiver now for the failed bank and
continue with the liquidation of the
bank’s assets.
T h e Co-operative Credit Association,
while not a bank, w ill render service to
this community much like that of a
bank.

Bank Moves

“The Kind of Service you’ ll Like”

C ontinental N


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Federal Reserve Bank of St. Louis

ational

LINCOLN, N E B R A S K A

B

ank

A ll assets of the State bank at Farnam were moved to the First State bank
at Gothenburg last month.
T he State bank at Farnam was start­
ed 32 year ago by M r. and M rs. Hugh
Ralston. M rs. Ralston passed away in
M ay, 1930, and M r. Ralston died July
22, 1933, and since that time the bank
has been operated by M rs. B. R. Kittenbrink, vice president, and C. E. D avid­
son, cashier. It became necessary to liq­
uidate the bank in order to close the es­
tates of M r. and M rs. Ralston.

A . I. B. Rally
Omaha members of the American In­
stitute of Banking attended a dinner and

19

Central Western Banker, O ctober, 1934

pep rally recently at the Elks club. V o ­
cational instructors spoke briefly about
courses to open this fall.
Members heard J. F. T . O ’Connor,
comptroller of currency, in a radio ad­
dress on “ Trained M inds,” broadcast
from W ashington. T h e program was
part of national commencement exer­
cises for more than 200 chapters
throughout the country.

F ifty Years
T he Farmers Bank of Nebraska City
passed the half century milestone when
the institution became 50 years of age.
It was founded September 1, 1884, by
the late J. H . Catron, father of the
president in 1934.
T h e four officers of the bank have a
combined banking experience of 115
years. T hey are: J. H . Catron, presi­
dent; James T . Shewell, vice president;
J. R. Stevenson, cashier, and M ark
Fullriede, assistant cashier.

Co-operative
T h e Weston Cooperative Credit A s­
sociation started business last month in
the brick building formerly occupied by
the W eston postoffice. T h e large safe
from the Swedeburg Bank was installed
in the building.
Board of directors are as follows :
Frank J. Dolezal, president; J. P. Svoboda, vice-president; Joseph Kacirek,
secretary; Emil W onka, and F. E. W o ita.
Credit Committee: Edward T urn wall, Charles D olezal and H . P. Gree­
ley.
Supervisory Committee: T o n y Kriz,
D r. F. J. W oita and J. J. Machacek.
Treasurer, Anton Fisher.

years ago, was in Cozad recently. She
and her two children, after a trip
through the Panama Canal, were cn
route from N ew Y ork to their home
in Eos Angeles.

torical high. O n July 1, 1934, the liquid
reserve was 71 per cent as compared
with a 53 per cent figure for the same
date a year ago.

County Meeting
Anniversary
T h e Carson National Bank of A u ­
burn came into existence August 28,
1882— 52 years ago. It was first known
as John F. Carson & Co. and then as
the Carson Bank and in 1887 became
the Carson National Bank. O n Novem ­
ber 22, Robert C. Boyd, present cashier,
will have been connected with the bank
for 50 years.

T w en ty officers from eight banks in
Keith, Perkins, Garden and Deuel coun­
ties attended a meeting in Ogallala re­
cently.
Follow ing a turkey dinner at the D it­
to Cafe, the business session was held in
the Citizens bank. Officers were elected
as follow s: M . B. Keller of Grant, pres­
ident ; Dale Contryman, vice president ;
G . D Adams, Brule, secretary-treasurer.
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Deposits Increase
State banks in Nebraska, although
their number decreased from 415 to
328 during the July 1, 1933, to July 1,
1934, twelve-month period, have none­
theless shown an increase of over $3,000,000 in aggregate deposits during
that time and their reserve position is
the strongest in history, the state bu­
reau of banking reports.
O n July 1, 1933, deposits in state
banks stood at an aggregate total of
$61,622,000 as compared with $64,803,000 on July 1, 1934. T heir cash reserve
on July 1, 1933 was 53 per cent of a to­
tal of $39,485,000 in loans and discounts
totaling $26,299,000.
Huge bond holdings— mainly govern­
ment issues— acquired during the year—
bring the liquid reserve position to a his­

Kansas News
in iiiiM iiiiiiiiiiiiiiiiiiiiiiiiiiiiiii!iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiitiiiiH iim iiiiiiiiiiiiiiiitlii,„rir„ir!„„m i,i,i

Doubles Capital
T he First National bank of Parsons
announces that it has increased its cap­
ital to $100,000 through the sale of
$50,000 of preferred stock to the Re­
construction Finance corporation. This
increase of capital is made to conform
to the provisions of the bank act of 1933
which act made many changes in the
federal statutes affecting national banks.

Enlarge Office
Remodeling of the office of G . W .
Snyder, Jr., assistant cashier of the T o ­
peka State bank, Eighth and Kansas
avenues, is completed. This remodeling

Remodeled
T h e interior remodeling and decorat­
ing of the Banking House of A . W .
Clarke, Papillion, is completed and pre­
sents a more roomy and airy appear­
ance than heretofore. W ork in g space has
also been rearranged with a light and
roomy office space in the rear of the
building, looking out through casement
windows on the landscaped garden. A
private consultation room in the front
of the building furnishes accommoda­
tion to persons who may wish to com­
plete transactions, or to examine the con­
tents of their safety deposit boxes.

Visits Cozad
A daughter of W illiam Dale, found­
er of the first bank of Cozad over forty

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Your Cash and Collection Items
W ill Be Given
SPECIAL ATTENTION
( T ry O u r S e rv ic e )

LIVE STOCK NATIONAL BANK OF OMAHA
O M A H A

20
was part of the revamping of the bank’s
home.
Snyder’s office has been enlarged, the
level of the floor dropped to the main
level of the bank and a new floor and
linoleum covering installed. T h e Kan­
sas avenue display window of the bank
has been enlarged and will be used for
display purposes of the bank’s custo­
mers.

New Officers
T he board of directors of the Nation­
al Bank of Commerce, W ellington, at
a recent meeting, elected the follow ing
new officers: O . L. D eT u rk , president;
W . H . Cortelyou, vice president; and
D . E. Flower, director to fill the un­
expired term of the late E. B. Roser.

Heads Clearing House
Joe J. Flyn of the State bank was
elected president of the Parsons Clear­
ing House association at a recent elec­
tion. H e succeeds Luther Cortelyou of
the First National bank. Other officers
selected were W . O . Haubold, vicepresident;
Harold
Reece, secretarytreasurer, succeeding H . H . Bryant and
R. R. W ilson, manager.
T h e association is made up of the
four Parsons banks, the State, First N a­
tional, Commercial and the Exchange
State. It was organized in Parsons about
20 years ago.

Meet in Axtell
T he Marshall County Bankers asso­
ciation met in Axtell recently with John
M ollinger, cashier of the Citizens Bank,
Marysville, presiding. T h e session was
attended by practically all of the M a r­
shall county bankers and many from
Nemaha county were present as guests.
W . W . M oller, vice-president of the
stockyards, St. Joseph, and chairman of
the St. Joseph Clearing House, gave a
thorough explanation of the bankers
code, presenting facts and figures why
the new code was created and should be
observed.
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Central Western Banker, O ctober, 1934

of banking hours September 8, reported
the clearings were $516,067.24 during
the past week, compared with $402,231.58 during the first week in Septem­
ber, 1933.

Bright Spot
Colorado Springs was one of the
bright spots in the business picture of
the tenth federal reserve district in
July, with gains recorded in new con­
struction permits and in bank clearings,
the monthly review of the federal re­
serve bank shows.
Construction estimates for July, 1934,
totaled $415,479 compared to only $10,885 for the same month a year ago. T he
gain is represented by the building per­
mit for the new Civic A rt center, a gift
to the Broadmoor A rt academy.
Debits by Colorado Springs banks to
individual accounts in July this year to­
taled $11,121,000, compared to $10,726,000 for the same period a year ago,
a gain of 3.7 per cent, compared to a
loss of 0.2 per cent as the district aver­
age for the month.

A number of Colorado banks already
have made loans for improvement of
homes under the new national housing
program and other loans are expected
to be closed rapidly from now on.
As yet none of the loans have been
closed in Denver, although hundreds of
applications have been received by banks
and other lending agencies. It is expect­
ed Denver institutions w ill begin ap­
proving applications shortly.

Demand for Loans
Denver bankers report that there
have been indications recently of a re­
vival of commercial borrowings. W h ile
the heavy loaning period in the area is
in October, for the purpose of aiding
livestock men with lambs and cattle in
feed lots, there has been a sprinkling of
demands for other loans of late. W h eth ­
er loans in the area during the fall
months will be heavier than last year,
bankers pointed out, is dependent upon
the prices of feed prevailing at that time.

Vice-President
Housing Program
T h e two Canon City banks, the First
National and Fremont County Nation­
al, have signed contracts of insurance
and are eligible to make loans under the
federal home modernization credit plan.
A t the same time it was learned that
plans were underway to name a Canon
City committee to pass on application
for loans. It was expected that this
committee would be named shortly, and
the setup would then be completed to
go ahead and make loans.

Open Again
W ith business once more going on as
usual at all three corners of the bank
square in Lamar and practically all of
the old officers at their desks the city
looks as if it were practically back to
normalcy and the people seem to be
fused with new spirit.
T h e only new
face is that of Gale A . Lee, former post­
master of Pueblo, whom the new board
of directors of the Lamar National
elected as cashier.

im im im iiiiiiiiiiiiiiiiiiiiiiiiM iiiiiiiiiiiiiiii:m iiiiim iiiiiiiiim iiiiiiM iiiiiiiiiiiiiiiiJ M iiiiiiiiiiiiim iiiiiiiiiiiin iii;i

A . F. Grimmell has accepted a posi­
tion with the First National bank of
Durango as acting vice president, and
his many Durango friends will be glad
to greet him there. M r. and M rs. G rim ­
mell, during their relatively short resi­
dence in Durango, became attached to
the city, both from a business standpoint
and from a standpoint of social tics.

Reduce Interest
Another slash in savings deposit in­
terest rates will be made by Denver
banks on O ctober 1. O n that date, ac­
counts carrying a balance of more than
$2,500 will be paid at the rate of 1 per
cent a year. This is the lowest rate ever
paid in Denver for such accounts. A c ­
counts of under $2,500, which make up
96 per cent of the savings of Denver
citizens, w ill continue to receive 2 per
cent a year, also a record low rate for
Denver.
iiiiiiiiiiiiiiiiiiiiiiiim iiiiiiiiriiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiin iiiiiiriiiiiiiiiiiiiiiiiiiiiiiiiiiii

Wyoming News
•lllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll!lllllllllllilllllll|iMIIIIIII!lllllllllllll

Heads State Bankers

Clearings Up

To Manitou

Clearings of the five Pueblo banks
the first week in September soared to
over the half-million dollar mark and
surpassed the clearings for the same
week in 1933 by nearly $100,000.
T he First National bank, at the close

R. J. Pendergrast, in the banking
business in Colorado Springs ¡since 1909,
has been elected executive vice presi­
dent of the Bank of Manitou. He and
his family have moved to M anitou from
Colorado Springs.


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Making Loans

John A . Guthrie, president of the
First National bank of Laramie, is the
new president of the W yom ing Bankers
association.
M r. Guthrie was elected at the con­
cluding session of the bankers’ conven­
tion in Lander. He succeeds Harry R.

21

Central Western Banker, O ctober, 1934

W eston, state treasurer, a former Lara­
mie man.
Other officers chosen were Ray F.
Rower, W orland, vice president; C. W .
Erwin, Lusk, treasurer; and Miss Kath­
leen Snyder, Casper, reelected secretary.
Laramie has extended its invitation to
the association to hold its 1935 conven­
tion there. T h e choice of a city will be
made by the executive committee during
the winter. Cody is also in the field.
T h e convention went on record in a
resolution vigorously opposing the dis­
continuance by railroads of emergency
drouth area freight rates.

W ild e said that an increase in capital
through the sale of preferred stock to
the Reconstruction Finance corporation
now totals $890,000.
T his means of strengthening the banks
was made possible through legislation
enacted at the special session. Examiner
W ild e assisted in getting the laws
through the legislature and then assisted
the banks to get into condition to take
advantage of the R F C purchases.

Adopt F H A
T h e Albany National bank is one of
several commercial banking institutions
in the Rocky M ountain region which
has accepted contracts of insurance un­
der the modernization program outlined
by the federal housing administration.
Blanks have been received upon
which local property owners may apply
for insured loans, of which 20 per cent
of the liability in case of default is un­
derwritten by the federal government.

Increased Capital
Wyoming banks have strengthened
their capital structure nearly a million
dollars since the special session of the
legislature, State Examiner A . E. W ild e
announced recently.

T h e federal housing administration
has announced the follow ing acceptances
of contract of insurance, under the m od­
ernization credit plan by financial in­
stitutions :
N ew M e x ico : Dem ing— Dem ing Fed­
eral Savings and Loan association ; Las
Cruces— First National bank of Las
Cruces, and M esilla Valley bank; Ros­
well— Equitable Building and Loan as­
sociation.

Mlllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll

Remodeled

Join New Plan
T h e federal housing administration
announced the follow ing banks had ac­
cepted contracts of insurance under the
moderization plan.
W yom ing :
Basin— Security State Bank.
Buffalo— Pfirst National Bank.
Greybull— T h e First National Bank.
Rock
Springs— North
Side
State
Bank.
--------------------------

Housing Loans

11111111111111111111111111111111111111111i 1111111111111111111111111it 111111111111111111111111111111111111111111111111111n11111111111111111n

To Buy Assets
John Emmons, president of the First
State bank and of the closed First N a­
tional bank of Gallup, announced a
newly formed Southwest Credit corpo­
ration, composed of the depositors com­
mittee,
has submitted
to
Receiver
Charles E. M ann, an offer to purchase
the remaining assets of the First Nation­
al bank.
T h e amount to be paid for the as­
sets is to be face value of deposits re­
maining after payment of the proposed
50 per cent dividend estimated at $100,000, plus $3,000 for costs of winding
up the receivership.
Roughly Emmons estimated the offer
would involve $100,000 for unpaid de­
posits and $3,000 for receiver’s expenses.
T h e money is to be paid in cash and
receiver’s certificates.
T h e amount offered, it was explained,
will be sufficient to pay depositors of
the bank 100 cents on the dollar, an
accomplishment never before achieved in
N ew M exico without a stockholder’s
assessment.

T h e First State Bank of T aos under­
went a number of alterations recently.
A ll of the walls were re-kalsomined, and
the entrance into the “ inner sanctum”
was changed, so that the door is now
more conveniently located at the north
end of the dividing wall.

The Transportation Ideal
“ W h at we want is a transportation
system that will adequately perform the
transportation service required at a given
time, expand or contract to meet the
varying needs of commerce, and also pro­
vide, in so far as possible, the stability
which is required in the interests alike
of shippers, investors, laborers and the
taxpaying public,” said Harold G .
M oulton, president of the Brookings In­
stitution, recently.
It is to be regretted that our present
system hardly resembles this ideal. A s
many authorities have pointed out, there
is a vast amount of waste in the opera­
tion of our various common carriers— a
vast amount of duplication of facilities,
for which the public, in the long run,
must pay. T h e fault lies in our trans­
portation policy.
T h e Interstate Commerce Commis­
sion has said that all carriers should pay

AUSTRALASIA

BANK OF N EW SO U T H W ALES
E S T A B L IS H E D

1817

( W i t h w h ic h a re a m a lg a m a te d T H E W E S T E R N A U S T R A L I A N B A N K
a n d T H E A U S T R A L I A N B A N K O F C O M M E R C E L t d .)
P A ID -U P
C A P IT A L
.....................................................................................................£ A 8 ,7 8 0 ,0 0 0
RESERVE
RESERVE

F U N D ..................................................................................................................
L I A B I L I T Y O F P R O P R I E T O R S ...............................................

6 ,1 5 0 ,0 0 0
8 ,7 8 0 ,0 0 0
£ A 2 3 ,7 1 0 .0 0 0

Aggregate Assets 30th September, 1933, £ 111,512,302
A G E N T S __ F I R S T

N A T IO N A L B A N K , O M A H A . N E B R A S K A

H E A D OFFICE, GEORGE ST., S Y N D E Y


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Federal Reserve Bank of St. Louis

GENERAL

M ANAGER, ALFRED

CHARLES

D A V ID S O N

LONDON OFFICE, 29 T H R E A D N E E D L E ST., E. C. 2

7 1 0 B r a n c h e s a n d A g e n c i e s in A l l A u s t r a l i a n S t a t e s , F e d e r a l T e r r i t o r y ,
N e w Z e a l a n d , F i j i , P a p u a , M a n d a t e d T e r r i t o r y o f N e w G u in e a a n d L o n d o n

22

Central Western Banker, October, 1934

comparable wages, render reliable serv­
ice and bear equal tax burdens. Leading
authorities believe they should likewise
be regulated by one agency. Achieving
these things would give us a fine start
toward solving the growing transporta­
tion problem.

public pulse changes its beat materially,
the bulk of sentiment will be in favor
of a reasonably conservative stand. M ost
businesses and individuals believe that
gold should remain the backbone of the
system— and there is a strong demand
that monetization of silver be adopted, in
order to provide gold with an ally in do­
ing essential work.
N ot since the days of Bryan has mon­
ey so excited the electorate— nor caused
so much dissent among a multitude of
experts.

Building Costs
T h e long awaited lift in the construc­
tion industry began to take tangible
form at the end of last year. T h e Fed­
eral Reserve’s adjusted index of con­
tracts for November was at the highest
point since October, 1931.
T h e principal impediment to a resi­
dential building boom of any moment,
is the problem of finance. And that
problem is on its way to solution. Pri­
vate and public agencies have been study­
ing it, and machinery is in motion to
loosen money, at lower interest rates,
for home construction. W h en that time
comes, it w ill mean that prices of mate­
rials and supplies— which have been ad­
vancing slowly for some months— will
jump.
It is not an exaggeration to say that
the future of residential building is no
longer problematical— every sign points
to substantial gains. If a word to the
wise is sufficient, those who need new
and improved housing, will build and
repair now, paying less for what will
soon cost much more.

Money . . .
Hard and Soft
T h e growing complexity of the money
problem found its echo lately in the res­
ignation of two high government offi­
cials.
T h e subject of monetary standards is
very likely to be the hottest of subjects
when Congress convenes. And, unless the

I

i

T he farm cooperative movement is,
first and foremost, designed to help the
agricultural producer — to obtain for
him a larger share of the final selling
price of his product, and to make his
production methods more profitable and
efficient.
In carrying out this purpose, the con­
sumer is not “ stung,” he is, on the con­
trary, immensely benefited. It is neces­
sary to him that a constant supply of
first-grade farm products be always at
his beck and call. H e wants food of
quality, sold at a fair price. A nd that
is what the cooperatives strive to give
him. W h en a farmer gets more for what
he raises it does not mean that the con­
sumer is the victim of profiteering — it
simply means that the money he pays to
the retailer has been fairly distributed
between those who produced the prod­
ucts, those who handled them between
farm and market, and those who sold
them to the public.
From another aspect, the farm co-op
is aiding the urban resident. Farmers
of the country normally provide the
largest single consuming source for the
products of our factories. T h e drop in
farm income is one of the most burning
problems of depression. As the co-ops
gradually make progress, and farm in­
come rises, all classes of American cit­

C entral T y p ew riter E x c h a n g e , Inc.

)

j

In The Interest of A ll

(EST. 1903)

NEW

AND

R E B U IL T T Y P E W R IT E R S ,
W R IT E R S — F U L L Y

AD D IN G M A C H IN E S,

C H EC K

GUARANTEED.

R E B U IL T M IM E O G R A P H S, STENCILS A N D IN KS
|

L O W E S T P R IC E S

ALLEN-WALES
1820 Farnani St.

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Federal Reserve Bank of St. Louis

T H E F IN E S T “ H E A V Y D U T Y ”
AD D IN G M A C H IN E M A D E

Omaha, Nebraska

izens will reap the benefit of stimulated
buying and increased purchasing power.
T od ay farm cooperation is one of the
greatest social and economic forces in
our national life. It has done much in
its brief lifetime and its period of great­
est achievement still lies in the future.

The Railroads
Maintain Service
N o industry has suffered greater eco­
nomic difficulties in recent years than
the railroads. For them, the depression
did not begin in 1929— it started just
after the war, and in not a single year
since have they been able to earn the
legal
fair return” upon their invest­
ment of 3>Y\ per cent permitted by law.
Nevertheless, the efficiency of the lines
has been scrupulously maintained and
improved. N ot so many years ago car
shortages were a commonplace— today
there are no shortages. T rain speeds, both
freight and passenger, have been in­
creased, spoilage of perishable goods in
transit has been reduced to a minimum,
and standards of safety have reached the
point where you are safer on a train
than in your own home.
T h e railroads have cut expenses to the
bone. But it seems impossible for them
to effect further economies of importance
— and it is inevitable that service will
suffer unless measures are taken to give
the rails a fair chance to earn a reason­
able profit, even if rate increases are
necessary.
Hundreds of thousands of
jobs, millions of invested capital, and the
very existence of the nation’s principal
means of transport are at stake.

The Answer Is Easy
A hard-headed California editor, who
publishes the Oakdale Leader, wants to
know who is going to pay the California
taxes when the politicians put the exist­
ing power companies out of business,
with duplicate, tax-exempt, publicly-sub"
sidized plants.
H e asks the question after noting that
one gas and electric company alone, in
his state, pays into the state tax coffers
$847 an hour, or $7,427,678.64 a year.
There is only one answer:
Those
taxes, plus the additional taxes required
to finance unnecessary tax-exempt com­
peting plants, would be added to any
remaining taxable property.

1934

Convention
Nebraska
Bankers Association


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Lincoln
November 8-9
Headquarters at Lincoln Hotel


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