Full text of Central Western Banker : September 1928, Volume 23, No. 9

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

ST EA M B O A T S

The “ W estern Engineer” was the
first steamboat to ascend the Missouri
as far as the present site o f Omaha.
This was on September 19, 1819. By
1857, the year in which our bank was
organized, there were fifty boats mak­
ing Omaha a port o f call.
The arrival o f the first steamer in the
Spring was a great event. It was the
custom to hold a Grand Ball on ship­
board.
This
some
more
your

bank has had dealings with
o f its correspondent banks for
than a half-century. W e invite
patronage.


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Federal Reserve Bank of St. Louis

First National

I Bank of Omaha
FIRST TRUST COMPANY

O

Ja s D
minute
n r HE BUSINESS E X T E N S IO N
1 D E P A R T M E N T of the Union
Trust Company of Detroit has a new
head. Earl Adams Clark has recently
joined the Union Trust Staff as vicepresident in charge of that department.
Mr. Clark conies to Detroit from In­
dianapolis, where he was in charge of
the new business, public relations, and
advertising activities for the City
Trust Company of that city.
T H E G U A R A N T Y T R U ST COMP A N Y of New York announces
the opening of an office in St. Louis,
which will be located in the Boatman’s
Bank building. This branch will ope­
rate through the company’s Chicago
office, with I. A. Wight, Jr., and D. E.
Wight in charge.

of the Foreign Commerce Department
Committee of the Chamber with the
work of the Finance Department of
the American Committee of the In­
ternational Chamber of Commerce.
" T H E M O N T A N A BAN KERS AS1 SO C IA TIO N held its 1928 con­
vention at Yellowstone Park. The
members held their sessions in Old
Faithful Inn. Officers elected were:
President, R. O. Kaufman, vice-presi­
dent of the Union Bank & Trust Com­
pany, Helena; Vice-president, N. A.
Telyea, vice-president of the National
Park Bank at Livingston ; Secretary,
A. T. Hibbard, Helena.
A H IS T O R Y OF SCH OOL S A V ­
INGS banking in the United
States has recently been issued by W.
Espey Albig, deputy manager of the
American Bankers Association. Mr.
Albig reports school savings in 46 of
the 48 states, with the aggregate net
annual savings in the United States in
excess of nine and one half million
dollars.

P

A. PU RDY, vice-president of
* Wells-Dickey Company, invest­
ment bankers of Minneapolis, has been
appointed as a member of the advisory
committee of the Democratic National
committee. Mr. Purdy is now vaca­
tioning in Glacier National Park, and
ipon his return will go directly to New
York to take up his political work.
t^ D W A R D

T. TOBEY, 44 years
old, vice-president of The Feder­
al Commerce Trust Company, Invest­
ment Division of The National Bank
of Commerce in St. Louis, died re­
cently at Barnes Hospital in St. Louis
following an operation performed for
tumor of the brain. Mr. Tobey joined
The Federal Commerce Trust Com­
pany nearly four years ago, coming
from Meemphis, Temi., his native
city, where he had been engaged in
the real estate business.

a n e
of
the
p r in c ip a l .
^ SPEAK ERS at the recent meet­
ing of the Mortgage Bankers Associa­
tion of America held in Cleveland, O.,
J
I. ESTRIN , of the American Exwas C. J. Claassen, of the Peters Trust
*~J‘ change Irving Trust Company
Company of Omaha.
of New York, has re­
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il mini
mmmmmmmmimmmmimmimmmmmiiimiimiiimimmmmimmiiiimiiii
Mr. Claassen spoke on
cently returned from
“ Experience in the
a three months busi­
Voi. 23. No. 9
SEPTEM BER, 1928
Current Farm Real
ness trip abroad. Mr.
E s t a t e Situation.”
Estrin reports sub­
More than 400 mort­
stantial improvement
gage bankers attended
in the economic condi­
Legal Department ................................................................... 4
the convention.
tions of the countries
In and Out of the South Dakota Guaranty Law . .
5
of
Central Europe.
National Problems at A. B. A.Convention . . . .
7
He
quotes the pro­
After We Get His A c c o u n t ...................................................9
gress made as being
J O H N G. LON SBY R A L P H O. K A U F F M A N
remarkable.
DALE, president
Creating Good W i l l .................................................................10
of The National Bank
BY K A T H E R IN E S C H E N C K
of Commerce in St.
Bond Prices and InterestR a t e s .........................................11
Louis, who is one of
p O L F I N G BANKBonds and I n v e s tm e n ts ...................................................... 15
the most active mem­
ERS W H O A T ­
In s u r a n c e .................................................................................. 21
bers of the Chamber
TEN D the American
Nebraska N e w s ...................................................................... 24
of Commerce of the
Bankers Association
News of the Omaha StockY a r d s ....................................... 27
United States, has
convention in Phila­
Kansas News ............................................................................. 22
been further honored
delphia will compete
Colorado N e w s .....................................................................33
by that body by being
this year on the Phil“ Have You Heard This One?'5
34
appointed as a mem­
mount Country Club
ber of a Special For­
course, with Friday,
T h e C e n t r a l W estern B a n k e r of O m a h a
eign Commerce Com­
Oct. 5, as the tour­
Published monthly at 416 Arthur Bldg., Omaha, Nebraska
mittee which will car­
nament day. The usu­
Subscription, 25 cents per copy; $2.00 per year.
Entered as second-class matter at the Omaha postoffice.
ry out plans for co­
al prizes will be o f­
lllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllillllllillllllllllllllllllllllllllllllllllllllliilllll|||||IMIIIIIi:illllllllllllllllll:UIIIIIIII!lll|i!llllllllllllllllllllillllllllllllllllllllll||||||||||||,|||||f|||||||||,||||||||ll
ordinating the work
fered, including the
llllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll|i|llllllllll|lIIIMIIIIIIIIIIIIIillllllllllllllllllllll,IIIIIIIIIIIH, ||,||||||||„|, ,||,|,|„| linn


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Federal Reserve Bank of St. Louis

hi

hi mi

h im

In Th is Issue

Central Western Banker, September, 1928

4
St. Louis Cup for the lowest gross
score, donated by St. Louis bankers in
1919.
A

P. G IA N N IN I, California financier, has recently returned from
Europe. Questioned regarding the
wide fluctuations in the stock of the
Bancitaly corporation, of which he is
president, he said he warned investors
in January to “ get themselves in the
clear.” However, he says the institu­
tions themselves were never in better
condition.

A

B. A. D ELEG ATES on the FaH•tonic enroute to Philadelphia are
having an unusual spectacle prepared
for them at Niagara Falls. The falls,
one of the wonders of the world, are
to have special night illumination in
honor of the visiting bankers. Search­
lights producing 1,320,000,000 candlepower will be used. If in doubt as to
how much that is, just try it on your
adding machine.

P U B L IC O FFERIN G H AS RECEN TLY been made by the Uni­
ted States treasury of about $525,000,000 nine months 4j^ per cent treas­
ury certificates, dated September 15,
to fall due June 15, 1929.
1LJERBERT P. H O W E L L has been
A ■*" elected as the senior executive of
the new Commercial National Bank &
Trust Company recently organized in
New York. Mr. Howell was for ten
years vice-president of the National
Bank of Commerce, and at present is
a director and member of the execu­
tive committee of the Bankers Trust
Company.
A LARGE N UM BER OF TH E
^ S T O C K H O L D E R S and some of
the bondholders of the Chicago, Mil­
waukee & St. Paul Railway are appar­
ently unaware of the fact that in the
plans of reorganization since the com­
pany went into the hands of a re­
ceiver they stand to lose around $2,-

000, 000.

A X /H L L IA M J. D O H E R T Y has reV * cently become associated with
the Rudolph Guenther-Russell Law
Advertising Agency in its Chicago o f­
fice. A complete advertising agency
service is now offered to all financial
institutions of the Middle West, com­
prising planning, research, copy, ana­
lytical surveys, art, and design.
r > Y TH E A C Q U ISITIO N of the
^ deposit assets of the Security Na­
tional Bank of Fargo, North Dakota,
the Dakota National bank of Fargo
steps into second place, the First Na­
tional’s last published statement show­
ing resources of over eight million dol­
lars, and the published statement of
the Dakota National of Fargo $2,904,590.76. The credit for working out
the plan for taking over the deposit
assets of the Security National Bank
by the Dakota National, and thus as­
suring all depositors in the Security
National Bank that they would get
every cent of their money, was worked
out by E. J. Weiser, president of the
First National Bank of Fargo.

W hen Usury Is a Defence
T o a Mortgage
B y T h e C e n t r a l W estern B a n k e r Legal Department

A PR O V ISIO N in a mortgage was
to the effect that the mortgagor
agreed to pay the maximum legal rate
of interest on the debt secured and, in
addition, especially agreed to pay tax­
es upon the mortgagee’s interest in
the mortgaged premises. A foreclos­
ure action was brought on this mort­
gage. Usury was pleaded as a de­
fense to the mortgage.
The clause in question that was
claimed contained such a requirement
that a greater sum or rate of interest
than is permitted by law could be col­
lected provided that the mortgagor
was to pay all taxes and assessments
levied upon the mortgaged premises,
or upon the mortgage or note which it
secured, before the same would be­
come delinquent, and a further proviso
that after the mortgagor failed to pay
the taxes the mortgagee might pay the
same and the amount so paid or ad­
vanced for taxes should be secured by
the mortgage and bear interest at ten
per cent per annum.

When It Exceeds the Maximum
“ When a contract, by its terms,
requires, for the use of the money,
the payment of a greater sum than
the maximum legal rate of inter­
est, it is in fact, usurious. The
mortgage contract in question
shows that there was an intent on
the part of the borrower to give
and an intent on the part of the
lender to reserve and take, inter­
est in excess of the maximum
legal limit. This makes the con­
tract in question usurious!”

Usurious, On Its Face
This mortgage contract, the makers
thereof contend, is on its face, usuri­
ous, because, by its terms, it requires
the mortgagor to pay, in addition to
the maximum rate of interest permit­
ted by statute, the taxes that may be
assessed or levied on the note, and

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

mortgage or assessed on the mortga­
gee’s interest in the mortgaged prem­
ises.
In some states of the Union, it is
provided by statute that such a pro­
vision in a mortgage is valid. H ow­
ever, in the absence of statutory legis­
lation, especially providing that a
mortgage carrying the maximum
legal rate of interest and the additional
payment of such taxes is not usurious,
the matter comes under the usury sta­
tutory law of the state, in which the
real estate is located.
In determining the question in any
state, the statutory provisions and for­
mer decisions of the courts of that
state as to what constitutes usury are
first to be considered. For instance, if
the maximum rate of interest pro­
vided by statute that may be taken or
reserved by a lender is eight per cent
per annum, a mortgage, and mortgage
note that contains a provision, where­
by the total amount of interest that
(Continued on

Page 23)

5

In and Out
of the

outh Dakota Guaranty Law
'■jpHE history of the bank guaranty

One o f a series o f articles dealing
the assets of each of said banks of
with the history and final outcome o f
law and its operation in South
one-fourth of one per cent of such
the hank guaranty measures that have
Dakota is an interesting one, notable
average daily deposits as shown by
been adopted by the various states. A n ­
mainly for its many revisions and
such statement, which said assessments
other article will follow in the October
shall be continued from year to year
changes. Going into effect in 1915,
issue o f the Central W estern B anker .
until the sums realized from such as­
the plan became so involved by 1926
that its liabilities reached the appal­
sessments, together with the accruals
ling total of more than forty million Illlllllllllllllllllllllllllllllllllllllllllllllilllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllfl and earnings thereof, shall amount, in
the aggregate, to a sum equal to the
dollars, with possible assets of failed
banks not more than half o f that now on pay their regular assessment capital stock of said bank; written
amount. Consequently drastic revis­ to the state treasurer, the same to be notice of such assessment shall be
ions were made necessary.
credited to each bank until the bank given to each bank by the secretary of
the commission and
Considering first the
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such notice shall be
most recent changes
deemed legal and com­
and present status of
plete when the same
the law, in the fall of
has been placed in an
1926 the South Dakota
envelope
securely
Bankers A s s o c ia tio n
During the fall of 1926 the South Dakota Bankers Associa­
put on an educational
sealed, postage prepaid
tion put on an educational campaign in the state to inform the
directed to such bank,
campaign to inform the
people relative to the exact status of the hank guaranty law. The
and deposited in the
people of the exact sta­
1925 Legislature repealed the law hut by petition, the action of
United States m a i 1.
tus of the guaranty
the Legislature was referred to the people in the fall election of
Upon the levy of such
law. The state legisla­
1926. The people, by small majority, voted N O T to sustain the
ture had, the preceding
assessment and the giv­
action o f the Legislature. Therefore the law was still in effect
ing of such notice , said
year, repealed the law,
when the 1927 Legislature convened.
bank shall forthwith
but by petition, the
The 1927 Legislature so revised the law that instead of pay­
action of the legislature
pay to the treasurer of
ing into the old defunct guaranty fund, banks now continue pay­
was referred to the
said depositors’ guar­
ing their old assessments to the state treasurer and the amounts
people in the 1926 fall
anty fund commission
so paid are credited to each bank’s own fund. This is covered by
election. The people
the amount of such as­
Section 9011. A definite cut-off has been made with the old fund.
then voted not to sus­
sessment, either in cash
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tain the repeal, there­
or in securities ap­
fore it was still in e f­
proved by said Depos­
fect when the 1927 legislature con­ builds up a reserve equal to its capital
itors’ Guaranty Fund Commission.
stock. The payments may be invested
vened.
Deposits With State Treasurer
in securities, the income from which
Law Was Revised
“ ‘The guaranty fund collected
The 1927 legislature so revised the is credited to the bank’s fund.
from each bank shall be deposited by
“ The new law also gives the Guar­ the state treasurer in the manner that
law that instead of paying into the
anty Fund Commission (or Banking other state funds are deposited in dor­
old defunct guaranty fund, banks now
Board) many new and wide powers.
continue to pay their old assessments
mant accounts, or at the option of the
“ The portion referring to assess­ depositors’ guaranty fund commission,
to the state treasurer and the amounts
so paid are credited to each bank’s own ments, in particular, is section 9011, shall be by said treasurer invested in
fund. A definite cut-off has been and reads as follow s:
securities selected by said bank with
“ ‘On the first day of January of
made with the old fund.
the approval of said Depositors’ Guar­
each year, every bank engaged in the anty Fund Commission, and the inter­
Stating that many individuals think
the revised law has many admirable business of banking in this state under est accruing therefrom shall be credit­
features, Secretary George Starring of
the laws of this state shall make and ed to the guaranty fund required of
the state bankers association, has made file with the Depositors’ Guaranty
each bank until such fund shall equal
this comment and explanation of the Fund Commission, a statement in writ­ the amount of the capital stock of said
ing, verified by the oath of its presi­ bank, and the entire fund shall be re­
new law :
“ You will recall that the legislature dent, vice-president or cashier, show­ tained to secure and indemnify the
in 1927 revised the guaranty fund law ing its average daily deposits for the creditors of such bank from which
providing that instead of the banks preceding twelve months; and such such guaranty fund shall be collected,
paying assessments into the old de­ commission shall, on February first,
against loss by the failure of said
funct guaranty fund, they shall from
thereafter, levy an assessment against bank; and said fund shall at all times


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

Central Western Banker, September, 1928

6
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(A s outlined by M. G. Luddy, South Dakota farm paper editor, in 1926.)

1. Guaranty of Deposits has failed in nearly every state where tried.
It is still on trial in Nebraska, where its future is doubtful.

2. Its operation has worked a hardship to depositors who eventually
pay the losses.

be exempt from levy
under executions or attachment and from
garnishment and shall
be exempt from tax,lP on

3. Because of the delusion that a tax upon the strong will prevent the
failures of the weak.
4. Guaranty of Deposits has proved to be an unsound and treacherous
form of mutual insurance in which the rate is not based upon
_ actual an<! local hazarils5. Any guaranty or insurance plan is foolhardy where the cooperating
insured gamble upon unknown risks as in guaranty of deposits.

'In case said bank
shall be closed as insolvent, or for any
other reason shall liquidate and the assets of
said bank ate insuffi
cient to pay its obligations in full, then the
amount in the guaranty
;
, ,
.,v ,
J
fund for said bank, or
so much thereof as
s h a l l be withdrawn
from the state treasury
upon the order of the
guaranty fund commis-

5 The system has and always will place a tool into the hands of unscrupulous and inexperienced persons for reckless banking,with subsequent abnormal increase in deposits.
7 The system penalizes the good banker by making him pay for the
follies of the “ wildcatter.”

g What about protecting depositors in closed National banks also?
They were hit by the same depression.
. . ,
. . . .
. , .
9' Why not a Guaranty for Agriculture and other lines of business
which have been injured or ruined?
10. The guaranty System is a farceand can never
following reasons:

pay out for the

The liabilities of the Guaranty Fund in closed banks
(estimated).............................................. -....................$41,000,000
Assets in closed banks will probably pay.............................. 20,500,000

a b o u t $3,500,000.00.
During t h i s period
|)ank failures were confined solely to isolated
institutions in which
unusual conditions existed with
leference
either to management
or character of investments, the lesult being
that subsequent to the
Cl eation of the Guara
A .aw and prior
period of deflation foliowing the war some
a r,
u „ „ 1,0
c ^ ft ,
hiteen banks m South
Dakota failed. For the
purpose of paying the
depositors of failed
banks where failure
was an isolated incident

sion and applied to the
There will be a deficit of.....................................................$20,500,000 due
the speC1^ ; . ^ I
payment of the creditInterest on deficit at 5 per cent.... ..................................... 1,025,000
tiaoidmai) cone ^
ors of said bank.
Deposits in open State Banks......................$100,000,000
existing m individual
“ ‘The annual assessIncome from one-fourth of one per cent assessment albanks the Guaranty
ment shall be paid by
lowed by law............................. “... ...........................
25Q’0QQ
Fund was sufficient to
each bank before the
Deficit on interest alone (no payment on principal).............. $ 775,000
^.aPt.,Fclie (Fthe deposit
payment of any divi'
liability. The depositdend or anv distribu0 1 s of the banks which
tion of profits to stockfailed during this perholders, and upon such
i°d were paid m lull
assessments being paid into the said ment into statute recognized its dan- and the Guaranty Law was heralded
fund, the amount thereof, as the same gerous features. The danger at that as a very valuable institution,
accumulates from year to year, shall
time was two-fold. Based upon the
Bringing the history of the law
become and at all times remain, the deposits in the state banks of the state down to 1926, Mi. Ludd\ made t us
property of the stockholders of said aj- qie time of the passage of the law
comment.
bank as the individual ownership oi the maximum fund that could be
Liabilities of $4:3,000,000
said stock shall be disclosed by the raised was not as large as the deposit
“ Examination of the records indi­
books of said bank; subject, howevei, liability of the one largest state bank cates on January 1, 1926, the date of
to the uses provided by this act .
in the state at that time and it was the last official report of the Guaranty
So much for the piesent status of apparent that if the largest state bank Fund Commission, a liability of apthe law. A glance back at the events should fail the assets in the hands of
proximately $43,000,000. The income
leading up to its attempted repeal will the Guaranty Fund Commission would of the Guaranty Fund Commission
also be of interest.
be insufficient to pay the liabilities of
from assessments is approximately
One of the best surveys of conch- that one bank< There was the fur$250,000 per year. Continuing the astions leading up to the attempted le- ther collapse of the financial conditions sessments would enable the Guaranty
peal of the entire measute in 1926 was as j-be result of which many banks Fund to make payments upon the Hagiven by M. G. Luddy, editoi^ of the would fail, leaving the fund entirely bility of the fund only to the extent of
South I3akota Farmer and Bieedei. inadequate to meet the demands upon
six-tenths of one per cent annuall} .
Referring to the original measure, it The ]aw jn South Dakota provided To the creditor of the closed bank this
which went into effect in 1915, M i. j 0r an assessment of one-fourth of
is an unusually insignificant fund. To
Luddy said, in 1926:
one per cent upon the average daily
the remaining institutions, however,
Dangers Recognized
deposits of each state bank. With the upon whom is placed the burden of
“ At the time of the adoption of the increase in the amount of business creating the fund for the purpose ol
Guaranty Law by the South Dakota which was done during the war period paying depositors, the burden becomes
legislature, the leaders who were re- and the increase of bank deposits, this a very severe one. It amounts to apsponsible for its passage and enact- fund reached a maximum total of
proximately 3 per cent of the capital
1

v

o

Central Western Banker, September. 1928

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

(Continued

on

Page

30)

7

of general public
as the farm prob­
lems, the Presidential campaign and
changing business conditions will min­
gle with technical banking discussions
on credit, the spread of group bank­
ing, bank taxation and bank adminis­
trative problems in the various ses­
sions of the Ameri­
can Bankers As­
sociation c o n v e n ­
tion which will be
h eld in Philadel­
phia October 1 to
4.
The program as
announced by F.N.
Shepherd, Execu­
tive Manager o f
the a s s o c ia tio n ,
shows that among
the leading speak­
ers will be : Thos.
R. Preston,President American Bank­
ers Association, President Hamilton
National Bank, Chattanooga, Tennes­
see; Edwin A. Alderman, President
University of Virginia, Charlottes­
ville, Virginia; James A. Bacigalupi,
President Bank of Italy National
Trust and Savings Association, San
Francisco; H. L. Russell, Dean Col­
lege of Agriculture, University of
Wisconsin, Madison, Wisconsin; Roy
A. Young, Governor Federal Reserve
Board, Washington, D. C. ; L. T. M c­
Fadden, Chairman Committee on
Banking and Currency, House of Re­
presentatives, Washington, D. C. ;
Leonard P. Ayres, Vice President
Cleveland Trust Company, Cleveland,
Ohio, and J. W . McIntosh, Comtroller
of the Currency, Washington, D. C.
e s t io n s
Q umoment
such

Independence Hall, Philadelphia

Section Board of Control— 1 :30 p. m. ;
State Legislation Committee and
State Legislative Council— 2 :15 p. m. ;
Agriculture Commission— 2 :30 p. m. ;
conference of bank auditors auspices
Clearing House Section— 2:30 p. m. ;
conference of clearing house exam­
iners auspices Clearing House Section
— 2 :30 p. m. ; Pub­
lic Education Com­
m ission — 2:30 p.
m. ; Savings Bank
Division g en eral
meeting 2 :30 p. m. ;
Federal Legislation
C om m ittee an d
Federal Legislative
C o u n cil— 3:30 p.
m. ;
E x e c u ti ve
Council— 9 p. m.
Tuesday, O c t o ­
ber 2d, BellevueStratford: State
Bank Division general meeting— 2:30
p. m. ; Nominating Committee— 5 p.
m. ; Resolutions Committee, call of
chairman.
Wednesday, October 3d, BellevueStratford : State Secretaries Section
general meeting— 2 p. m. ; conference
of clearing house managers auspices
of Clearing House Section—2:30 .p.
m. ; National Bank Division general
meeting— 2:30 p. m. ; Trust Company
Division general meeting— 8:30 p. m. ;
Resolutions Committee, call of chair­
man.
Thursday, October 4th, BellevueStratford : Executive Council— 9 p.
m. ; Administrative Committee, call of
chairman.
Each day of the convention period
there will be open in the BellevueStratford Hotel press headquarters,
joint headquarters for state secre­
taries having no separate headquart­
ers, booths for the hotel committee
and information bureau, a bank li­
brary exhibit, registration headquart­
ers, office of the general association,
golf committee desk, a postoffice and a
ticket validation desk.
In addition to the many attractions
of Philadelphia as a historical city,
excellent amusement features will be
provided visiting bankers.

National Problems
up to

A .B .A . Convention

The Schedule
The schedule of meetings of the
various committees, commissions, divi­
sions, sections, and general sessions to
be held in connection with the annual
convention of the American Bankers
Association at Philadelphia is an­
nounced as follows :
The general sessions of the associa­
tion as a whole will be held at the
Academy of Music the mornings of


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Tuesday, Wednesday and Thursday,
October 2d to 4th, opening each day at
9 :45 a. m.
Sunday, September 30th, at the
Bellevue-Stratford Hotel, which will
be the convention’s headquarters’
there will be a meeting on call of the
chairman of the Protective Commit­
tee ; on Reorganization of the Ameri­
can Bankers Association— 10 :30 a. m .;
Clearing House Section Executive
Committee— 1 p. m .; Savings Bank
Division Executive Committee--2 :30
p. m .; Finance Committee— 8 p. m .;
Administrative Committee— 9 p. m.
Monday, October 1st, BellevueStratford: Insurance Committee— 9
a. m .; Clearing House Section gen­
eral meeting— 9 :30 a. m .; Economic
Policy Commission—9 :30 a. m .; Fed­
eral and State Taxation Committees
joint meeting— 9:30 a. m .: 50th An­
niversary Committee—9:30 a. m .; Na­
tional Bank Division Executive Com­
mittee— 9 :30 a. m .; Public Relations
Commission— 9:30 a. m .; Trust Com­
pany Division Executive Committee
— 9:30 a. m .; Educational Foundation
Trustees— 10:30 a. m .; Commerce and
Marine Commission— 12:15 p. m .;
Membership Committee— 1 p. m .;
State Bank Division Executive Com­
mittee— 1 p. m .; State Secretaries

Central Western Banker, Se M em ber, 192S>

8

Above, Philadelphia bankers who will help guide the destinies o f the 1928 A. B. A. convention in the Quarker City October 1- 4.
L eft to right, Chas. S. Caldwell, president Corn Exchange National Bank and Trust company, chairman o f the publicity commit­
tee and member o f the executive committee; Joseph W ayne, Jr., president Philadelphia National Bank and chairman o f the e x ­
ecutive com m ittee; E. E. Shields, assistant cashier Philadelphia National Bank and chairman o f the arrangements committee.

A smoker at the Arena Tuesday
evening, October 2nd is an entertain­
ment feature planned for the delegates
to the 1928 Convention of the Ameri­
can Bankers Association.
Arrangements have been practically
completed to secure an announcer,
Eddie Cantor, blackface comedian and
star of many musical comedies. There
will be three boxing bouts and it is
expected several theatrical stars as
well as excellent vaudeville entertain­
ment.
Arrangements have also been prac­
tically completed for a Concert of the
Philadelphia Orchestra, conducted by
Leopold Stokowski to be presented
Wednesday evening, October 3rd, at
the Academy of Music for the Mem­
bers of the A. B. A.

This proposed concert will mark the
first public appearance of Dr. Stokow­
ski in Philadelphia after his year’s
absence in Europe, and the Orient,
where he was collecting data on
eastern music forms.
To Have Financial Exhibit
A complete financial library exhibit
will be presented by the financial
group of the Special Libraries Asso­
ciation at the American Bankers As­
sociation Convention in Philadelphia,
October 1 to 4, 1928, according to an­
nouncement by the committee in
charge, consisting of Ethel Baxter, li­
brarian, American Banker’s Associa­
tion ; Emma Boyer, librarian, Lhiion
Trust Co., Cleveland; Edna Caserline,
librarian, Mellon National Bank, Pitts­

burgh ; and Florence Wagner, librari­
an, Wall Street Journal. The exhibit,
which is sponsored and financed by
the various banks, is presented to as­
sistant bankers in obtaining the latest
and most authorative financial infor­
mation.
The exhibit, which will be a model
both in point of equipment and ar­
rangement, will consist of representa­
tive financial books for reference and
general use as well as files of news­
paper clippings and pamphlet material
showing best methods of filing and
the valuable use of such files. There
will also be samples of financial per­
iodicals. A special pamphlet is being
prepared for this exhibit which will
show how the library may serve the
bank.

Some o f the Quaker City bankers who will make delegates happy at the A. B. A. convention in Philadelphia O ctober 1- 4. L eft
to right O. Howard W olfe, cashier Philadelphia National Bank, chairman o f the clearing house section and hotel committee ; A.
D. Swift, vice-president o f the Central National Bank, chairman o f the information committee ; and H arry J. Haas, vice-president
First National Bank o f Philadelphia, chairman o f the National Bank division, vice-chairman o f convention executive committee.

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

9

“ A s bankers whose business brings this important subject
to your attention so frequently you have an important duty to
perform and not many of you are performing it. I f we know
that economic errors are daily being committed by our people we
should undertake to correct them by educational processes!”

Things W e Fail T o D o After
W e Get His Account
By R a l p h O. K a u f m a n ,
Vice-President and Cashier, Union Bank and Trust Co., Helena, Mont.

“ Does your wife know the value of
posits have increased to a satisfactory
O R many years, as most of you
your business and property?”
know, I have advocated a banker’s figure. But, in my opinion, we are
“ No.”
not going far enough to render ser­
program of education of the public in
“ Has she executive ability?”
vice and discharge our obligation to
economics, particularly that phase of
“ No.”
the communities we represent.
“ Is she in good health and strong?”
economics relative to banking. It has
Permit me to illustrate. Let us as­
“ Not very.”
sume that one of the most successful
been gratifying to note the progress
“ None of your children know any­
customers you have should slip into
which has been made in this work in
thing about it, do they?”
your bank tomorrow and tell you
many states, even though Montana, as
“ No.”
something like this. “ Well, Mr.
the result of peculiar conditions, has
“ Are they going to communicate
Banker, you know that I have worked
not been in the forefront in its prose­
with
you from time to time for advice
hard and given close attention to my
cution.
and direction?”
business and that I have accumulated
I still think that a vast amount of
“ No, I expect to be so far away
quite a fortune. I guess I’ll go away
good could be accomplished if bank­
that
they cannot reach me— they won’t
for
a
few
years
and
take
just
enough
ers devoted more time to this matter,
even know where I am.”
with me to last me as long as I wish
and today I wish to speak upon an im­
Now, can you imagine anything
to be gone.”
portant phase of economics which has
more startling or stupid than this?
You would ask, “ W ho will take
had pitifully small attention from
charge of your affairs while you are Yet, it is being done every day, ex­
either the banker or the layman in this
actly, except the customer does not an­
gone ?”
section of the country.
What if he replied, “ Oh, I don’t nounce his departure. Death takes
W e pride ourselves upon the great
care of that.
know, I think my wife will handle
service we render to our communities
Here is a great nation boasting of
everything all right. I have given her
in the fostering of business, livestock
wealth
estimated at about 300 billion
a
power
of
attorney,
and
she
can
use
and farming enterprises, and frequent­
dollars with 80 billion
ly boast of how we
......illuni........ .....................immillili................................................................................. ............................................................................................. ..... .............................
dollars
in life insurance
have stood by some
m force. Statistics caieworthy individual un­
fully compiled show
til we have made him
that 90 per cent of all
“ Conservation of our zvealth and its availability for use is
financially. W e boast
wealth, including life
just as necessary to our happy economic life as health, reserve
o f conservation o f
insurance, left by de­
strength always available to our physical makeup if we would
credit and the protec­
ceased persons, is ab­
tion of our affairs and
have long life!”
solutely
consumed or
the affairs of others
IIIIIIIIIIIIIIHIIIIIillHIIIIIIIIIIIIilllllUIIHIIIIIIIIIIIIIIIIIIIIIIIIMIIIIIIIIIIIIHIIIIIIIIIIIIIMIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIUlHIIIIIIIIIIIIIIIIIIIUIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIllllllimilllUl
dissipated within seven
with helpful advice and
years from date of death. And here
financial assistance. If we know a her own judgment, it’s a matter of
indifference
to
me.”
we are confronted with the unpleas­
man has wealth we cultivate his friend­
In astonishment you exclaim, “ What
ing prospect, that during the next
ship and try our best to gain his con­
does your wife know about your busi­ generation we will see wasted or con­
fidence to the end that we may handle
ness, she never had anything to do
sumed all but 10 per cent of this vast
his money and thus add to our volume
with it, did she?”
and our profits.
“ Oh, no,” your customer replies, wealth. Oh, but some say it makes a
W e believe that we have performed
“ but I told her she could ask anyone difference, somebody will get it. When
a real service, and profitable too, when she wished for advice. She has plenty a fortune is lost through ignorance, in­
experience or dishonesty, who gets it?
we have gone this far, and our de­ of friends.”


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Central Western Banker, September, 1928

ÎO
When a bank closes by
reason of poor manage­
ment, w h o profits?
When an immense in­
dustry fails, its land,
buildings, and mach­
inery lie idle and its
employes scatter, who
benefits, and w h e n
property or credit is
thrown to the winds,
who profits? Waste is disastrous in
business. Nature sets the example by
decreeing that she will allow nothing
to go to waste. Conservation of our
wealth and its availability for use is
just as necessary to our happy eco­
nomic life as health, reserve strength
always available is essential to our
physical makeup if we will have long­
life. W e do not profit by waste and
failures— we profit by conservation
and successes. W e are vieing with
each other to serve and profit from
the successful man of wealth, either
moderate or great, but what are we
doing for those fair enough for the
average case, they cannot possibly be
wisely relied upon in many, many in­
stances, as you have had occasion to
observe.
Men and women, especially those of
wealth and most of those whose wealth
is only moderate, should by all means
be taught to give this most important

some other intelligent
carefully planned dis­
position of his estate.
1— Sound business judgment.
How many of you
2— Investntent abHity.
bankers ever discuss
3■— Thorough investment information.
this vitally important
4— Financial standing.
matter with even your
5— Well organized clerical facilities.
closest customers and
6— Continuing existence.
how many of you know
whether your prosper­
ous customers have
matter more intelligent thought. They
ever made a will and have any idea
spend a lifetime accumulating, seek­
of how they have planned for the fu­
ing comfort for themselves and those
ture of those whom they will some
dear to them, spending hours and days
day leave behind?
in the consideration and manipulation
“ Oh,” say many, “ this is a private
of the affairs of one business transac­
matter— it’s too delicate to discuss,”
tion alone, and then devote either no
besides many people are too supersti­
time at all, or just an hour, often post­
tious, they dread the thought of these
poned until Death’s hand is reaching
things and feel that they are signing
toward them, in the preparation of a death warrants when they execute
document which is to bring good for­ wills. Many are deliberately decreeing
tune and happiness or misfortune and
misery and want to their loved ones
sorrow to those for whom they have
when they do not, and life today, with
worked incessantly.
its many risks, is more than ever un­
certain.
(Pardon me if I refer to one of the
If you can advertise or write about
most unfortunate cases that has come
a
subject,
why cannot you talk about
to my attention in many years. I re­
it ?
fer to the Largey case.)
The protection and preservation of
If a man dies intestate, one-third men’s estates is becoming more import­
goes to his wife if he has two or more
ant with the development of our eco­
children, and if none, she usually gets nomic progress. Fortunes are not so
only one-half.
easily made by the average man and
Every man should make a will or
(Continued on Page 12)

Creating G ood W ill
Among Women Employes
By

K

a t h e r in e

S

c h e n c ic

Kansas City, Missouri

Miss

C

a r r ie

H

udnall

How a personnel worker helps 300
women employes with their
business, personal and
social problems
V j l S S CAR R IE H U D N A LL, per­
sonnel worker among the women
employes of the Commerce Trust
Company, Kansas City, occupies the
only position of its kind among the

Kansas City banks. Such a position is
quite an innovation in financial institu­
tions, and it is said the Commerce
Trust Company set a precedent in the
middle west several years ago when it
employed Miss Hudnall for this work.
Miss Hudnall was employed in a
similar work in Boston before coming
into her present position.
A Changing Mein
Time was when a woman qualified
to be on a bank’s payroll was consid­
ered much too capable to need assist­
ance in establishing her business ca­
reer. This was due mainly to the
fact that few women were employed
and these women were highly trained
workers and particularly proficient in
some special line of banking. But
with the rapid growth of financial in­
stitutions today a large number of wo­
men and girls are employed in every
department and the heads of the in­

Central Western Banker, September, 1928


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stitutions are doing all possible to aid
women employees in developing busi­
ness character and discernment. While
the daily problems which frequently
disconcert a woman employed in a
banking institution are a little differ­
ent from those of a mercantile or in­
dustrial employee, she has the same
bit of business rough way to travel.
The daily contact with a woman of
sympathetic understanding in smooth­
ing these vexations is one of the ways
in which the women employes of the
Commerce are especially favored.
There are more than 300 women
and girls employed in the Commerce.
Many of them are young girls filling
their first positions. Quite a number
have come from the small towns ad­
jacent and it is especially to environ
these girls with a wholesome influence
in their business life that the Com­
merce employs Miss Hudnall.

11

Her Duties
The duties of her position cannot
be enumerated in items or hours. The
girls feel perfectly free to ask advice
on any of their affairs whether per­
sonal, social or business. The advice
asked for includes all subjects from
how to budget incomes to aid in se­
lecting clothes or on matters of daily
business deportment.

0?

03

04

05

06

07

08

Whenever an employee is ill, either
man or woman, Miss Hudnall visits
that person offering sympathy and
more material aid on the part of the
bank if necessary. It is the same with
any case of distress of whatsoever
kind among the Commerce “ family,”
Miss Hudnall’s time belongs to that
case until everything is right again.
The personal influence and good will

09

IO

II

12

13

14

15

16

17

18

19

department of the bank does not limit
its working hours to the period indi­
cated by a time clock’s stamp. Miss
Hudnall makes daily report of her
work to one of the bank’s officers and
frequently holds a friendly discussion
with department heads on things not
only for the general, but the individual
well being of those grouped under the
friendly title of the Commerce Family.

20

21

22

23

24

25

26

27

2B

— From Bulletin, Cleveland Trust Co.

B ond Prices and Interest Rates
g O N D prices have declined sharply
this year, and now many people
are asking whether it is not probable
that the falling trend is about at an
end. O f course no definite forecasts
as to their future course can be made,
but the evidence afforded by the re­
cords of the price changes of bonds
in former years seems to indicate that
the termination of the decline is not
very near.
In the diagram on this page the
line in the upper portion shows the
course of bond prices each month dur­
ing the past 29 years. For the first
20 years of the period the prices are
those of 30 high grade industrial and
utility bonds, while for the last 9
years they are those of 60 issues
divided equally among the industrials,
the utilities, the rails, and the muni­
cipals.
Represent Yields
In the lower section of the diagram
the slightly irregular line running al­
most horizontally across the page re­
presents the yields of these same


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bonds, while the line of wider fluc­
tuations falling below, and rising
above the bond-yield line, represents
the course of the rates on high grade
commercial paper. Both the bondyield data and those for commercial
paper are from figures published by
the Standard Statistics Company,
while the bond prices are made by
capitalizing the bond yield data at four
and one-half per cent.
In the lower part of the diagram
the periods when the commercial pa­
per rates were lower than the bond
yield are shown in solid black, while
those in which the commercial paper
rates were above the bond yields are
cross-hatched. In the upper portion
of the diagram the bond price line
has been cross-hatched during the
periods that are cross-hatched in the
lower part, and is in solid black in
those periods that are solid black be­
low.
The evidence of the diagram shows
that except for a part of the abnor­
mal war and post-war period bond

prices have had a declining trend
when commercial paper rates have
been above the bond yields, and have
had a rising trend when commercial
paper rates were lower than the bond
yields. At the present time commer­
cial paper rates are well above the
bond yields, and will probably remain
above them for some months to come.
Bond prices are falling, just as they
have in similar previous periods, and
it seems probable that their decline
has not yet been completed.
Relatively High, Also
When commercial paper rates are
relatively high other short-time in­
terest rates such as those for time
loans on collateral, and on call money,
are relatively high also. At such
times banks customarily put available
funds into such loans so as to take
advantage of the high rates, and re­
duce or suspend their purchases or
bonds. Many corporations, and some
individuals, pursue similar policies
with the result that the demand for
bonds is greatly reduced.

Central Western Banker, September, 1928

12

After W e Get His A ccount
(Continued from Page 10)

one thing is almost certain, that is this
-—the families of the well-to-do man
accustomed to reasonably luxurious
living find it harder to retain and in­
crease what has been left to them than
those who have been accustomed to
less. The wife and daughters seldom
seem to realize that when the father
has gone, the family income will no
doubt be less and the conservation of
the fortune, large or small, left to them
is vitally necessary to their comfort
and support. It is likewise true that
most men fail to give this matter seri­
ous thought and seem to feel that what
may occur after they have gone is a
matter in which they have no par­
ticular interest. (N o two cases alike.)
This lack of thought, the inability
of families to plan and execute and
the economic value of conservation
through intelligent and responsible
management, has brought into exist­
ence our numerous and most success­
ful trust companies throughout the
United States. These companies are
rendering a most remarkable service,
the value of which is fast becoming
recognized by successful business men
everywhere. As a result, figures have
been compiled from questionnaires
mailed to trust companies which show
an increase of 374 per cent in the use
of trust company services during the
past four years.
Men and women should be urged to
make wills, but above all things they
should have impressed upon them, the
wisdom of giving this matter careful
and intelligent consideration. There
are so many ways in which property

may be legally disposed of that each
case should be carefully analyzed be­
fore the drawing and execution of a
testamentary instrument. Likewise,
there are so many things that cannot be
legally done, that care should be exer­
cised in selecting an attorney and
where unusual provisions are made the
will should be checked by two men
competent to pass upon such docu­
ments.
For instance, the Montana laws pro­
vide that a man may not suspend the
power of alienation of property by
will for a longer time than during lives
in being at the date of death.
A man cannot dispose of more than
a third of his property to others than
his wife, without her written consent,
nor can a wife do so without the like
consent of her husband. These two
provisions are frequently violated and
contest after contest has been fought
as a result. It is, of course, impos­
sible to treat this subject exhaustively
in the limited time available to me,
but I mention these two, stressing par­
ticularly the frequent violation of the
statute, relative to power of alteration.
Has Grown Greatly
The creation of trusts by will has
grown greatly in use and importance
in a comparatively few years. Men
who make wills have begun to think
more of who will handle their estates
for them, and how they should be dis­
posed of. No man can possibly pre­
dict what changes will occur in the at­
titude of his family after he has gone
nor can he forsee the economic
changes which may occur within one

or two years after death. As an il­
lustration, what man could have im­
agined changes so great and far reach­
ing as those which took place from
1914, say, to 1921— and from 1921 to
1928?
1 he advent of the trust company and
the trust department have made the
creation of trusts wiser and more ef­
fective than ever before. A corpo­
rate executive or trustee does not die,
and has every incentive to properly
conduct the affairs of an estate or trust
successfully, and it is better prepared
by far than any individual could pos­
sibly be. A testator wants a success­
ful, capable man to handle his estate.
His friends from whom he might
make a selection are too busy, if suc­
cessful, handling their own affairs and
if not busy they are usually not suc­
cessful and therefore not qualified.
Some say why not any lawyer? 1
maintain, with all due respect to the
lawyer, that his profession does not
usually qualify him to handle more
than the legal features of estate mat­
ters and his business of itself does not
train him in matters of investment.
That is a line of work for more gen­
erally understood by trust company
and bank officials you must admit, as
they make this their particular busi­
ness and study.
Your lawyer should draw your will
and see to its proper execution— that’s
his field. He should guide the execu­
tor in all legal matters pertaining to
the settlement of your estate, and the
importance of his work, and his re­
sponsibility is great, especially in the
(Continued on Page

C A R TO O N S OF THE M O N T H

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

14)

13

W

h ere

correspondent

bankers receive definite
help with those problems
of bank management and
i n v e s t m e n t on whi ch
banking profits depend
1869

1928

FREDERICK H. RAWSON

HARRY A. WHEELER

Chairman o f the Board

President

CRAIG B. HAZLEWOOD
Vice-President

UNION TRUST


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Federal Reserve Bank of St. Louis

CO M PANY
CHICAGO
Central Western Banker, September, 1928

14
5, —Well organized clerical facili­
ties.
6. — Continuing existence.
Continued from Page 12)
Trust companies do not mingle with
their assets the assets of an estate.
framing of the instrument before exe­
These are carefuly marked and set
cution. I know trust companies are
aside where they are immediately
regarded by some attorneys as inter­
available to be turned over to a suc­
lopers who have invaded their long
cessor should the company cease to
occupied field, but they are fast real­
do business for any reason.
izing that the services these companies
As a result of this highly developed
both executive and trustee, and are
and reliable service, a person may now
urging clients to do likewise. No in­
dividual has all these essential qualifi­ with safety provide for the creation
of short or life estates for members
cations :
of his family and rest assured that
1. — Sound business judgment.
his wishes will be respected and car­
2. — Investment ability.
3. -— Thorough investment informa­ ried out to the letter in so far as it
may be possible to do so.
tion.
One form of very valuable trusl
4. — Financial standing.

Things We Fail To Do
After We Get His Account

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

which the existence of trust compa­
nies have made possible, is the socalled life insurance trust. This is
comparatively new and back of the
year 1920 was rarely heard of. It
has resulted in bringing to the life in­
surance companies a vast amount of
new business because of the advan­
tages it offers. One of the great in­
surance companies in this country in
its annual report for 1927 states that
the life insurance trust was one of
the two outstanding features in its
business for that year made possible
by the co-operation of trust companies
throughout the United States. Its de­
velopment has been rapid, and will be
far more rapid as men learn of its
advantages. I dare say that not 50
per cent of the men in the country
have ever considered the wisdom of in
vestigating this new method of con­
serving wealth, and perhaps no more
than half of you have even heard of
the plan.
Life insurance policies are payable
to beneficiaries either in lump sums,
in installments over a life or a period
of years, or income is paid for the
same periods. All installment pay­
ments are fixed by contract and may
not be altered after the death of the
insured.
If the insured should leave the full
amount of his insurance in a lump sum
to a wife or family, the sum seems
larger to the beneficiary or beneficiar­
ies, and, being deprived of the guid­
ing hand of the deceased father, it is
very probably soon spent and unwisely
spent, too. If let to beneficiaries in
installments, frequently much less than
the beneficiary has been accustomed
to live upon, hardships frequently fol­
low.
A man taking out life insurance
frequently remarks that the install­
ments of say, $200 more or less per
month, will be sufficient to keep his
family from want at least. But, if
long illness should attack a member of
the family, or costly operations should
become necessary, or unusual educa­
tional costs for the child or children
should arise, there is no way to take
care of these emergencies, except, pos­
sibly through work by the wife, if she
be able, or long painful economy. The
insurance company has no discretion
whatever— it can and will pay only
what the contract calls for.
By means of the insurance trust it
is now possible for a man to create an
estate of which he can dispose in a
manner just as wise and as satisfac­
tory as though he now had that much
of it intelligently and advantageously
for his family by a last will and testa­
ment.

15

n

T ET me give some examples and ef­
fects of these American tariffs,
state against state. Some years ago one
state adopted a law levying a two per
cent tax on securities bought by its
citizens and originating outside the
state. The erroneous theory was that
the law would keep money at home for
development of home industry. Popu­
lar misconception fostered it against
any and all sound counsel. The very
next session of the legislature, how­
ever, repealed the law. It had kept
capital from coming into the state and
had hindered home capital in obtain­
ing that safety of employment which
lies in broadly diversified investment.
Meanwhile the state’s industrial pro­
gress and the pocketbooks of its citi­
zens paid a heavy penalty while the
law was in force.
State Laws Vary
In that same state there is a great,
nationally known enterprise that has
been built up by many years of honest,
tireless endeavor. It has been the
means of providing employment for
thousands within the state and has ad­
ded greatly to the wealth of the com­
munity and to a higher standard of
living. As a process in its wholesome
growth this enterprise recently issued
some millions of dollars in bonds, se­
curities of such soundness and desir­
ability that, although the interest re­
turn was only four and one-half per
cent, the issue was at once over sub­
scribed by reputable securities dealers
throughout the country and sold to in­
vestors— large and small.
Now let us see what may happen
when such a bond of the highest and
soundest type known to the business
world goes into capital channels among
the different states. First, however,
let me call to your attention the fact
that all the states, except two, have
laws especially pertaining to the sell­
ing of securities and that almost every
variety of regulatory provision may
he found among these acts. In al­
most all the states where the bond was
offered, the authorities did not ques­
tion its soundness and honesty. It
was the kind of security that they
liked to see in their states. In state A,


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Federal Reserve Bank of St. Louis

By H e n r y R. H ayes
Retiring President, /. B. A.
in the Middle West, for example, a
broad minded, and much-experienced
securities officer quickly approved the
bond. In state B, adjoining state A,
both with almost identical economic
and social conditions, the securities

H en r y R. EIayes

commissioner, also a wholly upright
man and capable official, refused to al­
low the bond to be sold in the state.
I repeat the incident as told to me by
a well-known securities dealer within
the state and an officer of one of the
soundest financial institutions of that
state.
When this local securities dealer in
State B subscribed for these bonds to
sell to his customers, he made applica­
tion to qualify them in the state; that
is, he sought official approval, as the
law requires. Then, as the law in that
state permits, pending final approval,
he sold the bonds, knowing well that
they were among the highest type of
securities obtainable. He even had
difficulty placating several experienced
investors because he could not obtain

sufficient bonds to satisfy the demand.
Then to his surprise, the state authori­
ties asked a certain form of appraisal
of the enterprise’s properties. He
could not give it because the business
had been built up steadily year by year
to such a huge sum that no one but the
company had information as accurate
as the information they desired.
“ In the absence of that particular
form of valuation,” said the state o f­
ficial, “ an earnings statement would
suffice.” “ Splendid,” replied the deal­
er, “ we can tell you the complete his­
tory of every dollar the enterprise has
or ever has had.” “ Yes, but we must
have it divided up as from each indi­
vidual unit of the enterprise,” was the
official reply. The dealer wished to
know what good that would do, so
long as the earning records accounted
for every penny and the information
on hand established the absolute
soundness and honesty of the enter­
prise and the security. To supply the
information in the form desired would
have required months of hard work
and an expense greater than the deal­
er’s scanty profits. Rather than sub­
mit to this greater loss he bought back
the securities at considerable trouble
and expense and shipped them out of
the state.
This incident may seem of small
consequence, but if you multiply them
by scores and scores of kindred inci­
dents. repeated day after day in many
states, it becomes apparent how great
is the expense in money, time and ef­
fort inflicted needlessly and wastefully, upon the business of the country.
When we add a consideration of how
the unequal, varied and peculiar tax
laws of the different states impose ad­
ditional unnecessary burdens upon the
capital market and the thrift of indi­
viduals, we can begin to comprehend
the hugeness of the economic waste
arising therefrom. For example, state
H. which is one of the richest in the
Union, favors stocks, as against bonds,
in its tax laws. As a result, state H
is less interested in bonds.
I trust that 1 have not given the er­
roneous impression that 1 oppose any
legitimate effort or law to curb the

Central Western Banker, September, 1928

16
traffic in fraudulent or worthless socalled securities. Next to the victim
of a securities fraud, it is the invest­
ment banker who suffers most when
fraud is perpetrated in a sale of securi­
ties, or alleged securities. He has no
part in or knowledge of the fraud,
but the impaired public confidence re­
acts on his business, no matter howr
honest or how conservative.
Fighting the “ Fakers”
As an investment banker and as a
member of the Investment Bankers
Association of America, I have for
years fought unceasingly in the war
against securities fakers. I know per­
sonally or by reputation the securities
commissioners of many of the states
and I have a profound respect for

them as an official class of high char­
acter, earnest endeavor and ability.
The point I wish to make is that their
tools, i. e., the laws, are often inade­
quate, and public misconception makes
it slow and difficult to improve them.
The securities commissioners should
be on the same high plane as the judi­
ciary and as nearly nonpartisan in
their position as is possible. Instead
we find them, as a whole, inadequate­
ly paid, their tenure of office subject
to the mercurial exigencies of politics
and the capable, upright official not in­
frequently turned out of office to make
a place for a uniformed person whose
training in the duties of his office will
require years.
It is not especially onerous that a
new issue of bonds may require the

paying of a small fee in each of as
many as forty states before the issue
can be sold in those states. Although
the total of such fees may amount to
a large fortune in the course of a year,
it is money well spent if it measurably
lessens the traffic in fraud. When,
however, the law gives most of its at­
tention to policing honest business in­
stead of apprehending and punishing
fraudulent dealers, when throughout
the many states the reputable invest­
ment banker is compelled to supply
elaborate information in one form
here, in another there and is continual­
ly bound with useless red tape, then I
must protest that the law has strayed
far from its purpose and the millions
of dollars of unnecessary expense it
imposes on honest business is little less
than an outrage on the public that it
should protect, not penalize.

Larger Bank Quarters

largest training school
the industrial world
qpHE Bell System employs more
than 350,000 people; and
throughout the System training
courses are provided not only for
the details of the every-day work,
but for the new duties and new
responsibilities which telephone
expansion and improvement are
creating each year.
Why conservative investment counsel­
ors recommey'id American Telephone
and Telegraph Co. securities
Bell System Service has grown and

is growing with the nation. Its
management is far-sighted, con­
servative, and yet progressive. The
System has a plant investment of
more than $3,000,000,000. It oper­
ates more than 59,000,000 miles of
wire, of which more than 39,000,000
miles are in underground cables.
American Telephone and Telegraph
Company owns more than 93% of
the combined common stocks of the
Associated Companies in the Bell
System which furnishes an indis­
pensable service to the nation.

tVrite f o r booklet “ Some F in a n cia l Facts”

BELL T E L E P H O N E
S E C U R IT IE S CO. Inc.
195 Broadway

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

New York City

In remodeling its main bankingroom so as to provide more space
and increased accommodations for
its patrons, the Lincoln National
bank and Trust Co., of Lincoln, Ne­
braska, is installing a new type of
fixtures that will eliminate the old
wire cages behind which its tellers
and other employes have heretofore
transacted their business with the
public.
The lobby has been enlarged by
setting up the new counters 4 feet
back from where the old ones stood.
It is now 42 feet long by 12 wide,
making 504 square feet of space for
the use of the public, which is 200
feet more than there were previously.
Officers of the bank will have their
desks in the front part of the room,
as hitherto, with a partition between
them and the lobby. This low wall
will be faced on the outside with
marble, and the top slab will also be
of marble 18 inches wide. A strip
of black marble will serve as the base­
board.
The marble front will continue
toward the rear, across at the back,
joining the west wall. Rising above
it will be a mahogany counter for the
receiving and paying tellers, 52 inch­
es above the floor at the top. Four
“ deal plates,” taking the place of the
old barred windows, will serve for
receiving deposits, paying out money,
issuing drafts, handing out state­
ments, etc. These will be 42 inches
high.
It is planned to make the lobby
more ornamental, one of the new
features being a tile floor consisting of
square slabs alternating mahogany and
and red coloring.

17

Financing for August
Shows Decrease
T N C O N T R A ST with many months
A in the past two years which pro­
duced record-breaking volume of new
investment financing, August showed
the smallest total for any month in the
last five years.
New note and bond offerings in
August totaled only $183,363,200 ac­
cording to the compiliation of Law­
rence Stern & Company, Chicago in­
vestment bankers. This compares with
offerings of $473,464,300 in August,
1927, and $283,456,800 in July, 1928.
The fall-off in last month’s financ­
ing was chiefly at the expense of for­
eign offerings in which class there
was not a single new issue. Railroads
also failed to produce a single new
loan. Less than $12,000,000 of indus­
trial issues were brought out on the
market last month. In the public util­
ity field there were offerings totaling
$77,340,000; this was the only classi­
fication to show an increase over July,
1928.
The total of all offerings for the
eight months of 1928 amounted to $4,714,883,400 compared with $5,419,583,200 for the corresponding period
in 1927. This is a decline of about
13 per cent.
Last month’s offerings, excluding
tax-exempts, included only 83 separate
issues. This compares with 137 such
issues offered in August a year ago,
and with 173 in July, 1928. There
were only 20 major issues of a mil­
lion dollars or more released in the
market last month compared with 63
in July, 81 in June, and 108 in May.

tal absence of new issues, the aver­
age price of a selected group of highgrade listed bonds registered a price
increase during the month of more
than .25. In addition to this tend­
ency toward firmer prices— the fact
that the flow of new issues has been
drastically curtailed in recent weeks
has created a more healthy condition
in the market; and in many cases the
dealers’ shelves are clean and such
dealers are expected to be alert to take

advantage of attractive new offerings
during September.
“ The general feeling among bond
men has become markedly optimistic;
and while it is not expected that the
price level prevailing last spring will
be regained in the near future, there
seems to be every indication that the
bond market during the autumn
months will be an active one.”
Defends Use of Brazil’s Gold
In a statement made public in the
July Federal Reserve Bulletin, the
president of the Bank of Brazil de­
fends the action of the Brazilian
government in making use of the gold

Commercial Paper and Acceptances
Short and Long Term Bonds
Investment Trusts

Exceeds New York
O f the 20 corporate issues in the
million dollar class offered last month,
Chicago investment bankers under­
wrote six totalling $63,200,000 and
for the first time surpassed New York.
New York dealers were forced to take
second place, underwriting only four
large issues totalling $13,400,500. Bos­
ton with a single issue of $2,650,000
took third place.
The Lawrence Stern & Company
monthly review concluded as fol­
lows :
“ Although in volume of new financ­
ing, August was the dullest month
that the bond market has known for
several years— there are many signs
that the month marked the bottom of
the recession which has been witness­
ed in recent months.
“ In the face of curtailed trading on
the stock exchange and an almost to­


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Federal Reserve Bank of St. Louis

W e can supply your needs in any maturity of thirty
days or longer at rates from 4 % % to 7%.
Please send for our lists

CLARKE, LEWIS & CO.
318 SOUTH NINETEENTH STREET
OMAHA

Central Western Banker, September, 1928

18
reserves against the notes of the Bank
of Brazil to meet a serious emergency
last year. The statements says: “ The
economic and financial condition of
the country, which had shown some
tendency toward improvement in
April 1927, became unsettled again in
October, as a result of insufficient
funds for financing the various crops,
especially the coffee crop, the yield of
which exceeded all previous amounts
and required the employment of con­
siderable sums for its financing.
“ In view of the situation, the gov­
ernment resolved to make use of
the resources (that is, the gold re­
serve against notes of the Bank of

Brazil), put at its disposal by the law
of December 18, 1926. This action, al­
though absolutely necessary and per­
fectly legal, gave rise to much entire­
ly unwarranted criticism. That the
criticism was unwarranted was proved
by the fact that within a short time
the reserve fund of £10,000,000 was
completely restored, after part of it
had been employed in the urgent
task of averting the ruin of producers,
which both the government and the
bank were under obligation to do.”
“ SAVE CONSISTENTLY”
“ Save consistently and plan your
investments.”

^*llllllltlllllllllUIIIIIIII!lllllllllllllllllllll1llllllllllllllllllllll!llllltllIIIIIIII!ll||||||||||||illllllllllllllllllllllllllllllltli:ill!lllllllllllllll|||llllllllllllllll||||lllltllllllllllllll!lllllllllllllllllllllllllllllllllllllllllll!lllllllllllllllllllllllllllllllll

AN INVESTMENT HOUSE
founded on the idea of rendering- superior
service to each and every client.
Consult us regarding our sound and diversified list
of bonds.

R ufus E. L ee & C o m p a n y
Investment Bankers
204-210 City National Bank Building

Omaha
.

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FACILITIES

TO

mu niiiiiini 11

M EET A L L

B AN KIN G

REQ U IREM EN TS

F IR S T N A T IO N A L
BANK ofCHICAGO
Affiliated

FIRST TRUST AND
SAYINGS BANK
Resources Exceed

$450,000,000.00

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

Frank O. Wetmore, Chairman
Melvin A. Traylor, President

In those six words, John P. Mullen,
assistant educational director of the
Investment Bankers Association of
America, answers a question upper­
most in the mind of practically every
man and woman in this country: How
can 1 gain financial independence?
“ Perhaps there is no great neces­
sity today to stress the importance of
saving consistently,” Mr. Mullen said.
“ A greater percentage of our citizens
is doing so than has ever been the case
at any time, anywhere, in history, but
it is important that these savers rea­
lize the need of a well-considered plan
and policy on which to proceed in the
making of investments.
“ No business man who hopes for
success would leave the future of his
business to chance. No sensible con­
tractor would attempt construction of
even a common dwelling without the
guidance of blue prints complete to
the minutest detail. Yet hundreds of
investors attempt to rear a financial
structure which will be sound and ade­
quate without the semblance of an in­
vestment plan or policy.
“ It is obviously impossible to set
up any single program which will meet
the requirements of every individual.
The value of an investment involves
more than questions of safety and
yield; in each case its adaptability to
the needs and purposes of the investor
must be given consideration. There
are, however, a number of broad,
general principles upon which the in­
vestor can formulate his own pro­
gram. First, determine your invest­
ment objective— whether it is to build
up a fund to finance retirement, to
provide means for education and
travel, or to create an estate. Second,
consider what investments will best
help you to reach that goal, keeping
in mind the degree of safety and mar­
ketability your condition requires and
the amount you can save and invest
regularly. Finally, remember that
sound investments are not confined to
stocks and bonds. One individual may
make his best investment in a sav­
ings account; another in a home. The
investment goal of one man may be
best accomplished through life insur­
ance. Others may profit most by tak­
ing all of these steps.
“ The important thing is that some
definite, well-balanced program be out­
lined, which will enable the individual
to make the most of his investment
opportunities. It should go without
saying that the man or woman with a
well-fitting, workable investment plan
gets farther along the road to finan­
cial independence than those who
make their investment purchases hap­
hazardly.”

19

The Trend for 593
Corporations
A comparison of the composite rec­
ords of 593 leading American corpora­
tions, for 1927 to 1926, according to
John Nickerson & Co., Inc., reveals
an increase in property accounts, but a
decrease in net profits, accompanied by
larger disbursements to bondholders
and stockholders.
To the investor, these figures emsize the importance of thorough analy­
sis of his holdings, in line with the
recommendations o f banks or invest­
ment houses whose standing merits
confidence. Investments should be
carefully studied with the aim of se­
lecting securities of those companies
whose operations reflect either—(1) Such development of products,
properties, and markets as to in­
dicate clearly a steady growth of
earnings in the future; or—(2) Current results at least more en­
couraging than the average.
Important items from the balance
sheets and income accounts of the 593
corporations have been combined and
published in a recent bulletin of Stand­
ard Statistics Company, Inc. The re­
sults are so significant as to merit in­
terpretation. These companies, con­
sidered as a unit, increased their prop­
erty accounts by $1,349,000,000 in
1927 as compared with 1926, and their
outstanding bonds and stock by a still
larger amount— $1,436,000,000.
Obviously, such increases can be
justified only by larger operations at
the present rate of profit or by larger
profits on the present scale of opera­
tions. Otherwise, difficulties may be
experienced in meeting i n t e r e s t
charges and maintaining present divi­
dend rates on the increased total of se­
curities outstanding.
But 1927 results, as compared with
those of the highly prosperous preced­
ing year, did not reflect such improve­
ment. Net profits of these 593 corpo­
rations declining $267,000,000, or 8
per cent. And of the net profit 77
per cent was paid out in the form of
interest and dividends of 66 per cent
for 1926. Only 20 per cent in 1927,
as against 28 per cent in 1926, was
carried to surplus.
Fixed Charges
Fixed charges were earned 6.4
times in 1927 compared with 7.6 times
in 1926. Preferred dividends were
earned 9.0 times instead of 9.7 times.
Common dividends were covered 1.4
times instead of 1.8 times.
The ratio of total current assets of
all these companies to current liabili­
ties improved from 4.1 to 1 in 1926,
to 4.3 to 1 in 1927. Current assets


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Federal Reserve Bank of St. Louis

declined $21,000,000, 1-5 of 1 per cent
while current liabilities declined $168,000,000 or 5^2 per cent. The total
cash account increased $93,000,000 or
2jS per cent. Accounts receivable de­
creased $294,000,000 or 9 per cent;
and inventories declined $32,000,000
or 6-10 of 1 per cent. The total
amount owed to banks, however, was
$37,000,000 more than in 1926, repre­
senting an &y2 per cent increase.
It may be assumed that to some ex­
tent the improvement in composite net
tangible assets resulted from new fin­
ancing during the year, as earnings
were insufficient to provide for both
this improvement and the increased
disbursements to the holders of securi­
ties.

This composite picture of the posi­
tion of nearly 600 leading corporations
is not necessarily a cause for alarm.
In many cases the added investment in
property will make for greater effi­
ciency, larger sales and increasing
profits. Some corporations are in all
major respects in, a better position
than ever. The point is that no one
corporation can continue, for several
years, to follow the average trend of
all these corporations— without effect
on the investment value of its securi­
ties.
It is increasingly important for the
investor not to act merely on ' tips” or
hopes. He should insist on definite
facts— and recommendations from de­
pendable sources.

Market Outlook
TAU RIN G the past five months we have been
suggesting the purchase of short term bonds
because the market did not indicate that bond
values had reached the bottom, and the longer
maturities did not look attractive at the prevail­
ing prices.
At this time we believe good Foreign Gov­
ernment bonds are a good purchase and in this
field we suggest:
State of San Paulo 6s due July 1, 1968 @ 94J4
Republic of Bolivia 7s due March 1, 1969 @ 97*4
Roman Catholic Church Welfare
Institutions in Germany 7s due March 1,
1946 @ 99.
City of Berlin 6s, due June 18, 1958 @ market
W e will be pleased to execute orders for these
Bonds. Wires may be sent at our expense.

SMITH, LANDERYOU & CO.
640 First National Bank Building
OMAHA, NEBRASKA
Telephone J A ekson 5065

Central Western Banker, September, 192S

20
POSSIBLE T A X TROUBLE
That section of the new Federal in­
come tax law relating to withholding
against interest paid on tax free cove­
nant bonds will probably cause more
complication than any other provision,
declares the Commerce Monthly, issu­
ed by the National Bank of Commerce
in New York. The bank says:
“ Because the new law was enacted
so recently nothing in the way of o f­
ficial explanation of ruling has yet
been formulated to guide withholding
agents and bondholders through the
complexities that have sprung up
over night.
“ Under the 1926 act and prior law,
it will be remembered, there was a
uniform withholding requirement re­
lating to tax free, covenant bond in­

terest generally. An amount of tax
equal to two per cent of the interest
was to be paid over to the United
States Government at the source in the
case of all tax-free covenant bond
coupons, unless the owners of such
coupons happened to be a corporation
domestic to the United States or a
foreign corporation doing business in
the United States or having an o f­
fice or place of business therein.
Become Greatly Complicated
“ With the revenue act of 1928 the
withholding situation with respect to
tax-free covenant bond interest be­
came greatly complicated. Under the
new law it is provided that in the case
of bonds containing tax-free covenant
clauses of two per cent or less the full

va n ish in

Bank accounts
After you have put in hard work in
building up deposits it is particu­
larly discouraging to see them melt
away as a result o f speculations or
carelessly made investments.

By

using The National City Company
as a source o f bond offerings you
can render a timely investment ser­
vice to your depositors. At the same
time you will be making a legitimate
profit for your bank.
Our nearest District Office will
gladly make suggestions whenever
you say the word.

The National City Company
National City Bank Building, New York

Offices in more than 50 leading cities throughout the world
BONDS

'

SHORT

TERM

NOTES

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

'

ACCEPTANCES

normal tax shall be paid at the source
on interest paid on and after May 29
to non-resident alien individuals, non­
resident foreign partnerships and non­
resident foreign corporations.
“ In the case of two per cent taxfree covenant bonds under the new
procedure when the indicated owner is
a non-resident alien individual or a
non-resident foreign partnership, the
paying agents now remit only 97 per
cent of the face amount of the cou­
pons. The three per cent thus de­
ducted, together with the two per cent
assumed by the companies issuing the
bonds, is paid over to the Government
in full settlement of the five per cent
normal tax due from the bond owner.
Similarly, when the indicated owner
of such bond coupons is a non-resident
foreign corporation the paying agents
remit only 90 per cent of the face
amount. The 10 per cent thus deduct­
ed, added to the 2 per cent assumed
by the obligor company, constitutes
the 12 per cent tax due from the
foreign corporations.
“ Where bonds contain a 1^2 per
cent tax-free covenant clause the pro­
cedure no doubt will be to pay 96>4
per cent on coupons owned by non-re­
sident alien individuals and non-resi­
dent foreign partnerships and 89kd
per cent on coupons owned by non­
resident foreign corporations.
In the case of bonds containing
tax-free covenant clauses of more
than 2 per cent, the new law provides
that an amount of tax equal to only
2 per cent of the interest is to be paid
over to the Government at the source.
In the absence of any official explan­
ation to date, this is generally under­
stood to mean that the procedure in
the case of 3 per cent, 4 per cent or
unlimited tax-free clause bonds will
be the same as that followed under
the previous law. If this is correct
the obligor companies will doubtless
pay to the Government the 2 per cent
required of certain bondholders and
remit to the latter the difference be­
tween 2 per cent and the amount as­
sumed by the covenant.
Procedure Unchanged
“ The withholding procedure fol­
lowed with respect to tax-free cove­
nant bond interest payable to citizens
and residents of the United States and
to partnerships maintaining offices or
doing business therein is unchanged
by the new law. Moreover, interest
paid on tax-free covenant bonds
owned by corporations domestic to the
United States and by foreign corpor­
ations doing business in the United
States or having an office or place of
business therein continues under the
new law to be free from withholding
requirements.”

21

Insurance

Protecting Business Interests
Through Life Insurance
How life insurance can solve the four major problems that arise
upon the death of a business man.
has its limitations as to maximum.
By C h a s . J. R o c k w e l l ,
'T 'H E service of Life Insurance in inWhen used to produce materials which
creasing the net worth of termi­
Director, Kockzvell School of
freeze into inventories this reduces
nated business ventures, and to pro­
the amount still free. Nor does the
Life Insurance
vide funds with which to buy out a
best type of credit bear any fixed ratio
deceased partner’s interest (which is
(From
address
before
National
Life
to the tangible resources. It depends
reallv returning to him his contributed
on the faith, confidence and judgment
Underwriters Association Convention)
capital with its accumulations) has
of the one granting it in the capacity
been so consistently preached that its
to use it profitably of the persons to
usefulness in this respect is now con­
whom
it was extended. Capacity then
Insurance
can
stabilize,
liquify
or
ceded. But the contingency this in­
brings credit and credit is capital—sures against is, after all, deemed a augment. The tendency of such
hence capacity is itself capital. Only
remote one as to its happening, and capital is to become frozen into fix­
b y L i f e Insurance,
the current prosperity
then, can an enterprise
of the enterprise dims
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avoid impairing i t s
the prophesy of the
working capital because
problem presenting it­
of lost capacity in its
self. Life Insurance
management.
W e con­
has a great value in
“ No institution that is always on the verge of dissolution can
vert the intangible into
promoting the success
ever he zvholly successf ul, no matter how excellent the capacity of
the tangible, avoid loss
of a going concern as
its management or the type of its capital. Within and without its
by making it unneces­
it is conceded to have
organization there is hesitancy and doubt. Lack of credit hamp­
sary to liberate the
in minimizing disaster
ers capacity, uncertain future limits plans . . . Life insurance can
credit frozen into in­
or as a shock absorber.
assure two things which, in effect, give continuity to any enter­
ventories
and make its
Our obligation is to
prise.”
expansion to the wild­
present it in this light
........... ...................iiiiimiiimiiiiiiiiiiiii.........
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..... ......... .....
.....
..... ..... in..... ................. ....... Mini
est degree required safe
-—as an ally to business
for both the grantor
success.
Business success rests upon three tures, inventories or accounts receiv­ and receiver of it.
Capacity Is Actually Capital
factors. Lirst: ample and elastic capi­ able. It is always limited, its amount
Capacity, then, is capital when it at­
tal— expanding and contracting as re­ fixed as to maximum and minimum
tracts credit, but it brings capital of a
quired to meet the demands of the and subject to sudden recall. Only
type
that intensifies the menace unless
business. Inelastic capital demands
forced sales will release frozen inven­
steps have been taken to offset the
dividends even in slack times and a tories, and these entail losses either of
effect of its loss. On the other hand
shortage of it sometimes limits prof­ profit or cost of goods, unless offset
to get the best results from capacity
its. Second: the capacity to man­ by cash from other sources; accounts
age that capital— both ability and op­ are only partially collectable by a it must be allowed opportunity. Capa­
city is not always due to the ability of
portunity must be present. Ability
liquidating concern and pressure from
limited in opportunity by apprehen­ a going concern embarrasses and a particular individual— it may be the
result of a combination of highly
sion yields no profits. T h ird: A
drives away its customers. Whether specialized experts. Allowing every
prospect of permanency in the venture
the need for cash is to meet liabilities
undertaken— both creditors and pat­ or replenish capital withdrawn by an man fullest opportunity to exercise his
ability makes for great gains but pre­
rons distrust an enterprise obviously
owner it is preventable by life insur­ sents the danger of disaster should the
temporary or which presents a con­ ance. To meet the problem of capital
combination be dissolved. It may be
stant threat of dissolution.
These
limitation and fixation another form
long before his associate or succes­
three basis factors of Capital, Capa­
of capital than money or goods is
city and Continuity are not only close­ necessary. Credit, which has been de­ sors can familiarize themselves with
his activities— they may never do it.
ly interrelated but are in a degree
fined as machinery invented to take
Momentum is checked, sometimes
transmutable notwithstanding the fact
the place of tangible capital, must be
that capacity, which is a human at­ made safe to use, safe to be depended never regained; profits are not made
and even present value imperiled. W e
tribute, seems to stand at the apex of
upon and any chance of its loss offset cannot prevent the loss of such capa­
the triangle.
by transforming the capital it supplies city by Life Insurance but we can off­
As An Aid to Capital
(intangible) instantly into cash capi­ set the effects of that loss and trans­
Capital, which is usually regarded as tal, when its supporting bases are lost.
form capacity capital into money cap­
But while credit is elastic capital it ital. W e can assure the profits that
made up of tangible resources, Life


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Federal Reserve Bank of St. Louis

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Central Western Banker, September, 1928

22
capacity would have created. W e can
even distribute financial responsibility
where it now rests on one individual.
No institution that is always on the
verge of dissolution can ever be
wholly successful, no matter how ex­
cellent the capacity of its management
or the type of its capital. Within and
without its organization there is hesit­
ancy and doubt. Lack of credit ham­
pers capacity, uncertain future limits
plans. Nothing can assure the dura­
tion of a life, but Life Insurance can
assure two things which, in effect,
gave continuity to an enterprise. W e
can make possible such a quick suc­
cession in ownership as to make the
transfer no stoppage in momentum ; it
can arrange for the transfer of that
ownership
to trained
successors
whether they have or have not, funds
of their own to acquire it ; it can equip
successors with the capital to con­
tinue even if known capacity capital
be lost and the capacity capital of the
successor unknown, removing the
necessity to depend on the credit cap­
ital the former capacity brought; and

it can help to select, attract and secure
the precise individual needed to sub­
stitute for any lost executive.
Four Major Problems
Even so hasty a survey of the fab­
ric of business as we have thus far
made discloses that four major pro­
blems present themselves singly or in
combination in the solution of which
Life Insurance can best meet the sit­
uation where death causes the pro­
blem to arise. First: the enterprise
may lose an important man, who may
be an owner or merely an employee.
His value to the concern may be due
to his technical knowledge or skill, his
managerial ability, his financial re­
sponsibility or to his advice because
of his experience. But in many cases
it may arise because of the good will
he holds or the business he controls
even though he be not active. Again
he may stand between the firm and
attack from unfriendly or hostile in­
terests. Second: the present posses­
sions and credit of the concern may be
impaired by sudden efforts to meet.

almost on demand, the liabilities of
the enterprise with no help forthcom­
ing from the deceased, and this de­
mand may be the more insistent where
any important factor in the business
is removed. Third : the difficulty of
retiring the interest of the deceased in
the enterprise is ever likely. While
this is optional, though desirable, in a
corporation, in a partnership it is a
right of the deceased’s representatives
against which the survivor has no de ­
fense. Fourth: the disastrous shrink­
age in the value of every asset the
firm owns where liquidation and dis­
tribution of the net worth of the en­
terprise is suddenly made necessary.
Not only are the assets of almost every
business today valued only as those of
a going concern, which values are al­
ways tinctured with hope, hence over­
valued, but all liabilities mature unex­
pectedly at par. No extension of time
is possible and credit favor is with­
drawn. The resulting disaster may
even operate to lower the credit stand­
ing of the survivors in any future ven­
ture thev may undertake.

Indications G ood
J F LIFE insurance sales may be ac­
cepted as a barometer of general
business trends the last quarter of
1928 will be the very best this coun­
try has ever enjoyed in a presidential
election year. Clearly the curves are
upward and the improvement is so
general there is every reason to feel
optimistic about the outlook for the
remainder of this year and the early
months of 1929.
“ With the national elections just
around the corner it is truly remark­
able the prevailing feeling of security
that is manifest everywhere. The old
tendency to hold back until after the
votes have been cast has been discard­
ed generally, so that there is compara­
tively little uneasiness in business cir­
cles anywhere.
“ New life insurance of all classes
written during the first eight months
of this year have shown a persistent
and consistent growth over the same
period in 1927. During this year to
date more than $5,700,000,000 of new
ordinary life insurance has been placed
in this country, about $1,900,000,000
of new industrial and almost $1,000,000,000 of new group insurance. A
very pleasing factor in life insurance
has been the improvement in general
conditions in the rural sections of the
Middle West, Northwest and South.
The outlook in those sections is most
promising.
“ Coming through the summer
Central Western Banker, August, 1928

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

B y O . J. A rnold

President American Life Convention
and President Northwestern
National Life Insurance Co.
months general business and financial
conditions were above the average the
best available statistics indicate. The
industrial and trade activity in July

O . J. A rnold

and August was more than the usual
volume in the Mid-Summer season and
the general level of commodity prices
held firm or slightly advanced.

“ Credit and money conditions be­
ing satisfactory, commercial concerns
came through the hot weather period
in splendid shape, and general busi­
ness should be accelerated with the
closing of the vacation periods.
“ Forecasts for good crops are very
pleasing to the agricultural districts
of the country and insurance agents
in the rural sections report an increas­
ing interest in life insurance and an
improvement in the lapse situation.
When the farmer is buying life insur­
ance in volume you may be sure he re­
gards the immediate future as secure,
it is one of our very best business indi­
cators.
“ Employment is on the increase and
there is every reason to feel that more
workers will be on the country’s pay­
rolls in October, November and De­
cember than at present.
“ For many years life insurance has
been accepted as a very good barom­
eter of general conditions. With hun­
dreds of thousands of life insurance
agents working in the field daily, en­
tering practically every home, factory
and business house, life insurance fig­
uratively has its hand on the pulse oi
the nation. So we are not tar wiong
in accepting life insurance trends as
a good indicator of general conditions.
‘“ Viewed as a whole the immediate
outlook for the entire countrv is very
good. Here and there we find some
bad spots but these are rapidly disap­
pearing.”

When Usury Is a
Defence to a Mortgage
(Continued from Paje 4)

should be paid by the lender amounts
to more than the maximum statutory
interest rate, could be shown to be a
usurious contract.
To make a contract usurious, there
must be an agreement between the
borrower and lender by which the lat­
ter receives or reserves a greater rate
of interest than the law allows. There
must be an intent on the part of the
borrower to give, and of the lender to
receive, interest in excess of the legal
limit.
“ Usury” is reserving or contracting
to reserve and taking for use of
money a greater sum or rate of inter­
est than is permitted by law.
Mortgagor Had To Pay
Had the mortgage in question not
contained the provision relative to the
payment of taxes, the mortgagee
would have been liable for the tax on
his mortgage interest in the mort­
gaged premises, and the mortgagor
would have been liable for the tax on
his interest therein, which would have

been the full value of the premises,
less the amount of the mortgage, T he
insertion of this clause in the mortgage
had the effect of shifting the burden
of the tax on the mortgage interest
from the mortgagee to the mortgagor.
This clause, therefore, required the
mortgagor to pay, in addition to the
maximum legal rate of interest, the
amount of the tax so transferred to
him.
When a contract, by its terms, re­
quires, for the use of money, the pay­
ment of a greater sum than the maxi­
mum legal rate of interest, it is, in
fact, usurious. The mortgage con­
tract in question shows that there was
an intent on the part of the borrower
to give, and an intent on the part of
the lender to reserve and take, inter­
est in excess of the maximum legal
limit. This makes the contract in
question usurious.
The holder of the mortgage, al­
though a provision in said mortgage
makes it a usurious contract, is still
entitled to recover the principal
amount of the mortgage note if this
part of the obligation is not tainted
with usury. There was no agreement
to pay an illegal rate of interest on the
debt so created.

A mortgage containing such a clause
as has been herein referred to is not
usurious, where the stipulated rate of
interest exclusive of the taxes is less
than the legal maximum of rate.

How They Do It!
You wonder how they do it
And you look to see the knack;
You watch the foot in action
Or the shoulder or the hack,
But when you spot the answer
Where the higher glamors lurk,
You’ll find with concentration
Mixed with much determination
That the most of it is practice—
And the rest of it is work.
They all have certain canny ways
Who reach the topmost round,
And most of them have certain styles
A t getting over ground;
But when you spot the reason,
Though the fellow is a Turk,
You will find in moving higher
Up the laurel-covered spire
That the hulk of it is practice—
And the rest of it is work.
— Selected.

YOUR OPPORTUNITY
Banking and Life Insurance go hand in hand.
Both institutions teach the principles and advant­
ages of thrift.
The banker is in a better position to educate
the public on the thrift idea than any other citizen
in the community.
W e are, therefore, anxious to obtain a num­
ber of progressive banker agents in Nebraska and
adjoining states and are offering an unusual parttime contract with liberal commissions and sales
training by experienced insurance men.

G uarant ee

F und

L ife

B uild ing

Write Agency Department for Details.

18th and Douglas Sts., Omaha

W e W rite
O R D IN A R Y L IFE
20 Y E A R AC C U M U L A T IO N
20 Y E A R E N D O W M E N T
E N D O W M E N T AT 65
E N D O W M E N T AT 70
Y E A R L Y R E N E W A B L E TERM
TERM IN SU R A N C E FOR 5, 10, 15,
20, 25 AN D 30 Y EAR S
DOUBLE IN D E M N IT Y
D IS A B IL IT Y BENEFITS
W A IV E R OF PR EM IUM
JU VEN IL E IN SU R A N C E


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Federal Reserve Bank of St. Louis

Gu a r a n t e e F und

. LIFE _T

A s s o c ia t io n
- O M AH A-

Assets Exceeding $13,000,000.00

Central Western Banker, September, 1928

24
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Nebraska News
iiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiuiiiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiiiii,iiiiiiiiiimiiiiii,iiiiiiiilii,,iiii,iiiiiii,iiiiiiiiiiiiiil|j|l,i

C. A . S M IT H , P re sid e n t
N e b r a sk a B a n k e r s A s s o c ia tio n

W M . B . H U G H E S , S e c re ta r y
N e b ra sk a B a n k e rs A s s o c ia tio n

Becomes Cashier
With the election of O. J. Nelson
of Genoa, Nebraska, as cashier of the
Battle Creek Valley bank, Kinely F.
Hogrefe, cashier for the past three
years, is promoted to the vice-presi­
dency of the institution.
Mr. Nelson has been employed by
the state banking department for
some time, his work being largely
with the guarantee fund commission.
His work at Genoa being completed,
resigned to accept the position offered
him by the Hogrefes. There will be
no immediate cnange in the person­
nel of the Battle Creek Valley bank,
it is announced.

Mr. Gillette, of Crook. A. C. Peter­
son, of the Cheyenne County bank, at
Lodge Pole, was also a visitor at the
meeting. A dinner was served to the
bankers in the evening, after which
they gathered at the Chappell State
Bank for their regular business meet­
ing. The next meeting of the associa­
tion will be held at Lisco.
Bank of Monroe Elects
At the regular semi-annual meeting
of the board of directors of the Bank
of Munroe, Nebraska, the following
changes in officers and board were
made:
Walter French who has served in
the capacity of assistant cashier, was
promoted to the position of cashier,
also a member of the board to fill the
vacancy of A. L. Pollard. Paul Gertsch, Jr., was also elected a member oi
the board to fill the vacancy which occured upon the death of C. L. Gerrard.

Interest in Charter Law
Bank supervising officials attending
the meeting of the national association
of bank commissioners at New York
New Banker
were much interested in the Nebraska
law which authorizes the state bank­
A new State bank has been charter­
ing bureau to refuse new bank char­
ed by the state department of trade
ters where existing facilities are and commerce, it was announced re­
deemed sufficient in a community,
cently by Secretary Bliss. The bank
Clarence Bliss, secretary of the state will be located in Madrid, Neb., will
department of trade and commerce,
have a capital stock of $25,000 and
said upon his return from the New
will be known as the State Bank of
York meeting.
Madrid.

Consolidated
The bank of Beaver City, Nebras­
ka, was consolidated recently with the
First State bank, which assumes all
liabilities. The Bank of Beaver City
was organized in 1905. It had de­
posits amounting to $200,000
The First State bank has been un­
der the same management for fortytwo years. It is one of the strongest
banks in this part of the state. The
consolidation meets the approval of
the business interests of Beaver City.
County Bankers Meet
The quarterly meeting of the mem­
bers of the Deuel-Garden County
Bankers’ Association was held at
Chappell, Nebraska, recently. About
twenty-five bankers were present, re­
presentative of the banks at Oshkosh,
Lisco, and Lewellen and Chappell,
there being also included in the num­
ber two representatives of Colorado
banks, Mr. Johnson, of Ovid, and
Central Western Banker, September, 1923

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Federal Reserve Bank of St. Louis

They also were interested in the
system of licensing bankers which
has been in effect in Nebraska for a
number of years, he said. Less in­
terest was shown in the bank guaran­
ty law than in former gatherings, he
said.
“ A strong sentiment was brought
out in favor of restricting credit for
speculative purposes in Wall street,”
Mr. Bliss declared. “ The federal re­
serve bank in New York has been ex­
erting itself in that direction by rais­
ing the rediscount rate and in other
ways, but its effort to check specula­
tion is handicapped by the fact that
western banks have been sending
money east to be loaned to stock bro­
kers on account of the high interest
rates available for such loans.”
The campaign to cut down all loans,
which have reached the unprecedented
amount of $5,000,000,000, will be con­
tinued, Mr. Bliss asserted. New York
banks may assist by inaugurating a
scale of service charges for handling
such transactions.

DE

National B ank
LTrust Company
O M A H A

‘An Unbroken Record of Seventy Years
is a Guarantee of Safe and
Satisfactory Service”

O F F I C E R S :
M.

T. B arlow , President o f the Board
R. P. M orsman , President

G. H . Y ates, Vice-President
C. M cClure, Vice-President
T. F. M urphy , Vice-President
C. F. B r in k m a n , A ss’ t V -President
P. B. H endricks, A ss’ t Vice-President

J.

R. R. R ain ey , Cashier
H. E. R ogers, Assistant Cashier
E. E. L andstrom, Assistant Cashier
A. L. V ickery, Assistant Cashier
V. B. Caldwell, Assistant Cashier

25
Elected President
W . S. Collett, who for the past
twenty years has been first vice-pres­
ident of the Crete State bank, has
been made president, succeeding to
the place made vacant by the death
of T. H. Miller, who organized the
bank. The latter’s son, James G.
Miller, has been made vice president
and will continue the insurance busi­
ness.

Driscoll, Omaha, announced recently.
Driscoll is head of a company capi­
talized at $100,000 which will be de­
voted exclusively to raising of musk­
rats, foxes and other fur bearing ani­
mals. A tract of 190 acres which in­
cludes the lake, has been purchased
by the company. FYank Warner of
Norfolk is secretary of the company,
and Mrs. Hazel C. Driscoll is vicepresident.

Back From Abroad
F. H. Davis, president of the First
National bank, of Omaha, accompani­
ed by Mrs. Davis, returned recently
from a three-month trip during which
they visited Italy, Switzerland, Aus­
tria and France.
This was the fourth trip abroad
for Mr. and Mrs. Davis, but their
first visit to Austria. Their daughter
Miss Elizabeth and Mrs. Henry Bott­
ling, who accompanied them to Eur­
ope, remained in the east to visit
friends. Mrs. Bohling stopping in
New York and Miss Elizabeth in
Hoopston, 111.
“ One of the most impressive things
about the trip was the remarkable way
in which Italy has progressed since
our visit there two years ago,” said
Mr. Davis. “ Most of the credit is
due to Mussolini. He works between
18 and 20 hours a day, I understand,
and he is making everybody in the
country work. There has been a
marked absence of beggars on this
trip in Italy and progress can be
noted in every part of the country.
They are building fine roads.
“ In Austria we were surprised to
find almost a deplorable state of af­
fairs. The country still is suffering
from the effects of the war.”
On the trip across the Atlantic,
aboard the Italian steamer Roma, the
Davis’ met and chatted with the goverenor of Rome and members of his
party who were returning from a visit
to this country.
“ The prince is a splendidly educat­
ed man and spoke excellent English,”
said Mr. Davis. ‘W e got very well
acquainted. He and his party were
quite impressed with their reception
in this country.”

Reorganize
Plainview, Nebraska, people are
enthusiastic over and are backing to
the limit a proposal to reorganize the
First National bank of that city
At a meeting of thirty-five deposit­
ors in the First National bank, S83,000 was pledged to start the new bank
on its way and indications are that the
bank will be operating within a short
time.
Dies at Blakesburg
Walter Abegg, 60, president of the
First National Bank of Alliance, Ne­
braska, passed away at his home at
Blakesburg, Iowa, recently. Banks in
Alliance were closed during the hours
of the funeral as a mark of respect.
Mr. Abegg had been in failing
health for some time, but had not

been considered dangerously ill. His
son, Edward, who had been connected
with the Alliance bank, was called
home two weeks ago to take charge of
the Blakesburg bank, and at that time
Frank accompanied him. It was said
that the father’s condition was not
serious, but that he would retire from
active work.
Mr. Abegg purchased control of the
First National bank following the
death of R. M. Hampton some years
ago, and had been a frequent visitor to
Alliance.
Saving’s Increase
Savings in Omaha banks reporting
to the Federal Reserve bank of Kan­
sas City, showed an increase of $1,151,440 over savings at the same time
last year, according to the monthly
federal reserve bulletin for this dis­
trict. An increase of 1,460 savings
account was shown. Bank deposits
(total check transactions) of Omaha
banks for the five weeks ending Aug­
ust 1 also showed a substantial gain
over the same period in 1927.
July production of Omaha flour
mills "was 100,717 barrels, a gain of
17,920 barrels over production of 82,797 barrels in July, last year, the re­
port says.

EXPERIENCE
FIDELITY
PERMANENCE
IN CONTINUOUS E X IST E N C E
SINCE 1891

PACKERS
NATIONAL BANK
Affiliation

P A C K E R S N A T IO N A L
COM PANY
INVESTMENT BONDS

With Cones State Bank
Hugo Flolm, of Clarks, Neb., has
accepted a position as bookkeeper in
the Cones State Bank and entered up­
on his duties. Mr. Flolm is a steno­
grapher by profession and has had
some experience in banking.
Establish Fur Farm
One of the largest fur raising farms
in Nebraska will be established at
Enola lake, near Norfolk, Robert E.


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Federal Reserve Bank of St. Louis

SOUTH

OMAHA

Central Western Banker, September, 192S

26
Resigns
Miss Lydia Peters resigned her po­
sition at the First National Bank, of
Crofton, Nebraska, and left recently
for Yankton, to accept a position
there.

OUR B A N K IN G ROOM
M A IN

FLOOR RIGHT

O FFIC ER S
FORD E. H O VEY, President
JA S . B. OWEN, Vice-Pres.
F. J. ENERSO N , Vice-Pres.
W. H. D R E SSL E R , Cashier
L. K. MOORE, Asst, to Pres.
H. C. M ILLER , Asst. Cash.
C. L. OWEN, Asst. Cash.
H E N R Y H O VEY, Asst. Cash.
T. G. BOGGS, Auditor

maintain special facilities
for the efficient handling of
grain drafts.
You may list them in your regular
remittance letter.

Sells interest
Will C. Dahnke has announced that
he has sold his interest in the State
Bank of Stratton, Nebraska, to Louis
Stolte, and he will confine his efforts
in the future to serving the public
along the line of Real Estate and In­
surance.
Ted Masters will become the new
cashier of the bank.
Fremont Banker Dies
Henry Tiegeler, president of the
Union National bank of Fremont, Ne­
braska, and of the Fremont Cream­
ery company, died at his home, 1306
North Broad street, recently.
Mr. Tiegeler was taken seriously ill
with a heart attack, but responded to
the treatment of his physician and was
feeling fairly well, though he was not
able to get up. He suffered a second
attack and died very suddenly.
In 1921 when the First National,
the Commercial National and the
Farmers & Merchants National of
Fremont merged, Mr. Tiegeler as­
sumed the presidency of the Union
National bank and had been active in
its management since, dividing his
time between the bank and the Fre­
mont Creamery company. For a num­
ber of years he had been connected
with the First National bank as di­
rector and vice president.
Married
Albert Stelling, assistant cashier of
the Bank of Gretna, Nebraska, was
married recently at Uniontown, Mis­
souri, to Miss Eleanor Franke of that
place. They will make their home in
Gretna.

Stock Yards National Bank
of
South Omaha
The Only Bank in the Union Stock Yards

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

Resigns
Earl H. Smith of Genoa, Nebras­
ka, will take the place of L. D. Miles
at the Security Bank of Creighton. Mr.
Miles has resigned and expects to at­
tend the University of Nebraska, tak­
ing a course in electrical engineering.
Cashier at Battle Creek
O.
J. Nelson of Genoa, Nebraska,
is soon to assume the cashiership of
the Battle Creek Valley bank.
O summer friendship,
Whose flattering leaves, that shadowed
us in our
Prosperity, with the last gust drop off
In the autumn of adversity.
— M assinger.

27

N ew s o f the

Omaha

■

CAUTIONS AGAINST
CATTLE SPECULATION
“ Although feeder cattle prices are
excellent and the breeder is finally able
to liquidate some of the burden of in­
debtedness he has borne during the
last ten years,” said ]. H. Mercer,
chairman of the National Live Stock
and Meat board, in an interview re­
cently, “ the immediate outlook for the
feeder deserves the best thought that
can be brought out. The reduced sup­
ply of cattle all through the country
and the prospects of a large corn crop
have combined to introduce a specu­
lative feature which may have an un­
favorable reaction later in the season.
“ Federal-inspected slaughter of cat­
tle for the month of July was 10.8 per
cent less than a year ago, while for the
seven months, January to July, in­
clusive, it was 10.53 per cent less.
Prices for beef steers average $15 at
Chicago for the month of July, or
$3.25 more than a year ago. Other
classes of cattle are proportionately
as high. With such a record existing
the scramble for feeder cattle has been
intense and there has been consider­
able trading and rehandling of cattle
before they have ultimately been sent
to the feed lot. T am informed that
the sales of feeder cattle for one week
at one of the important feeder markets
were two and one-third times as great
as the actual number of feeder cattle
received. The effect of such demand
was to place feeder cattle materially
higher, according to the class of ani­
mal, above what the packers were
paying for similar animals for slaugh­
ter purposes.
“ The result of such competition has
been to bring on to the public market
quite a percentage of the feeder cattle
which were available in the country.
For the first seven months of this year
there has been a decided increase in
feeder movement over a year ago—
the increase being from 1,327,000 in
1927 to 1,617,000 in 1928, nearly 20
per cent. Coupled with this, stocker


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lo c k Y ards
lu ;

and feeder prices have risen from one
to three dollars per hundredweight at
Chicago for the seven months’ period
in 1928, over the corresponding period
in 1927.
“ At Kansas City the same situation
has prevailed with an increased move­
ment of feeders and a price increase
corresponding to the Chicago market.
“ As a matter of fact, at the current
price levels there is plenty of beef for
the distributive outlets. It is not prob­
able that a greater shortage will de­
velop. Such a shortage does not seem
reasonable with the increased number
of feeders going to the country this
year as compared to 1927 and 1926,
and the further stimulus of a big corn
crop.”
Plan Livestock Show
Tremendous interest in the coming
Ak-Sar-Ben Live Stock show at Oma­
ha the week of November 3 to 9, is
evident, according to Professor How­
ard Gramlich of the University of Ne­
braska animal husbandry department.
People are talking about the coming
show from coast to coast. Some of
the biggest cattle breeders in the coun­
try will be at Omaha with their herds.
Professor Gramlich was at the fair
at Aurora, 111., not long ago and found
breeders from Kentucky, Tennessee
and also from eastern states, talking
about the show and planning to come.
Nebraska breeders are taking a keen
interest and there is every indication
that when the show opens up, there
will be a big event in every way.
Mrs, J, F. Coad Dies
Mrs. John F. Coad. wife of the
president of the Packers National
bank of Omaha, passed away recently
following a lingering illness. Death
came to Mrs. Coad at the family home
in Omaha. She was 44 years of age.
Mrs. Coad came to Omaha from
Berkeley. Calif., at the time of her
marriage in 1912. She had a host of
personal friends, as she was particu­
larly active in the work of St. Cc-

celia’s church and in charitable organi­
zations.
Besides the husband, the survivois
include two sons, John F. 3rd of At­
lanta, Ga., and Ernest, of Omaha; two
daughters, Mrs. C. A. Jeffrey and
Mrs. George C. Wigert of Omaha;
Mrs. Coad’s parents, Mr. and Mrs.
Timothy Dyer of Berkeley, Cak, three
brothers, James, Brian and Joseph
Dyer, and a sister, Miss Ethel Dyer,
all of Berkeley, Calif.
Cattle Buyer Dead
Funeral services were held recently
at Sioux City, la., for Charles Thom­
son, 50-year-old cattle buyer, who died
at Mankato, Minn., where he had
made his home recently.
Mr. Thompson bought cattle for
Armour & Co., for many years in
Omaha and Sioux City, and also spem
several years in South America, and
was well known on this market. Since
his return from South America in
1924, his health had not been good.
Surviving are a wife and two chil­
dren, a son and a daughter.
Fight Tuberculosis
Forty-three counties in Nebraska,
containing 41 per cent of the cattle in
the state, have been accredited as es­
tablished areas for the eradication of
tuberculosis in animals as a result of
the work carried on by the state bu­
reau of animal husbandry in co-opera­
tion with the federal authorities.
Twenty-nine of the 43 have been
sufficiently certified as to be classed as
modified accredited areas, which
means that in these counties the last
complete tuberculin test of all herds
showed less than one-half of one per
cent of the cattle to he infected.
Clark H. Hayes, chief of the. bureau,
reports that during the period between
June 1, 1925 and June 30, 1928, 118,583 herds, including 1,463,571 head of
cattle were tested. Cattle found to be
infected with tuberculosis numbered
16,491 in 9,183 herds. These were
slaughtered under official supervision.
Central Western Banker, August, 1928

28
The work is divided into co-opera­
tive work and private work done by
local practicing veterinarians. The co­
operative work is divided into the
county area plan and the accredited
herd plan, all directed toward the same
goal, the eradication of the disease.
Oppose Rate Increase
The state railway commission brief,
just filed in opposition to the applica­
tion before the Nebraska state inter­
commerce commission of railroads in
the western district to be allowed to
increase livestock rates, strongly urges
the justice of first requiring the radroads to put their passenger business
on such a basis that it is not necessary
for freight revenues to be used to
make up the deficit in returns.
Nebraska is the third state in the
district in the production of live stock.
Tn 1926 Nebraska stations forwarded
a total of 141,000 cars of live stock of
all kinds. O f this number 84,200 were
consigned to markets within the state.
The commission insists that while the
live stock situation has been greatly
improved, it yet has a considerable dis­
tance to go before it has reached sta­
ble foundations. To raise rates now
would turn back the progress now be­
ing made. The commission wants a
distance tariff put in, and feeders car­
ried on a 75 per cent rate basis.
Testimony of U. G. Powell, com­
mission rate expert, is quoted to show
that the rate of return on total busi­
ness in this state in 1926 was 5.83 per
cent, and that while the freight busi­
ness taken by itself returned 7.88 per
cent, there was a return of only .45
per cent on the property devoted to
handling passengers. Similar figures
were shown for the 18 railroads in
western trunk line territory.
A considerable portion of the brief
is devoted to showing that the cost of
handling all trains in Nebraska, by
reason of the fact that the trains run
in the valleys and on the plains and
have no expensive cuts and fills or
high elevations to climb, is lower than
it is in other states, whereas the live
stock rates are higher in Nebraska.
The commission asks that the pres­
ent minimums on carload shipments
be continued and that the Nebraska
rule as to carload shipments of mixed
stock should be established for the
trunk line territory.
Checks for Baby Beeves
Checks for $75,090 worth of baby
beef shown and sold at the recent Ne­
braska State Fair have been sent to
the boys and girls who owned the
calves.

The 472 head sold in the annual
auction sale at the fair averaged
$159.10 above the marketing cost.
From this amount and the premiums
won at the state fair the boys and girls
must deduct the original cost of the
calves, the feed bills, and other ex­
penses.
The beeves averaged approximately
925 pounds as they were weighed up
recently in the stockyards. It is esti­
mated that the animals will dress an
average of 61 per cent. Packer buy­
ers are quite well pleased with the
lot as a whole.
The grand champion of the show, an
Angus fed by Frederick Rottler of
Madison, dressed 67 per cent, an un­
usually high figure. The reserve
champion, a Hereford fed by Louis
Harris of Butler county, was not far
behind with a percentage of 66.1.
C. S. Maddox, O. O. Waggener,
Wm. J. Lieffel, and Prof. H. J. Gramlich of the agricultural college animal
husbandry department have all been
following the calves and studying the
carcasses. Mr. Loeffel, who has
charge of the meats work of the col­
lege, has been particularly interested
in the carcasses. Meat on the platter
is the final goal of all beef production,
he says, and boys and girls should
learn to produce the kind that will
satisfy the most particular palate.
Boys and girls are back home look­
ing for the grand champion of 1929.
Those who have learned their lesson
well will get their calves early and feed
them long and well. They will pick
the right type of calf at the start, and
probably more than one of them.
Interest will soon shift to the com­
ing Ak-Sar-Ben show at Omaha where
officials are looking for about 400
Nebraska baby beeves and several
hundred from Iowa. Many boys and
girls who did not exhibit calves at the
state fair will show them there.
Some Surprising Statistics
1. Twice as much insurance
is paid to living policyholders as
to the beneficaries of deceased of
deceased policyholders.
2. $2,250,000 in claims is paid
out every day by life insurance
companies.
SCHOOL FOR FARMERS
A school for farmers is at last real­
ized in “ The Farm Operator's Course”
which will be offered next winter at
the University of Nebraska, College
of Agriculture. This is a new and
very practical agricultural course that
should appeal to young farmers— too
old for high school and yet not pre­

Central Western Banker, September, 1928

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Federal Reserve Bank of St. Louis

pared for college, says Professor H.
E. Bradford, principal of the school
of agriculture.
The remarkable thing about this
new course is that it trains men for
farming and nothing else; no college
credits or degrees are given; and no
high school or prerequisite work in
any school, except an eighth grade
education is required. Dates for the
courses have been arranged to fill in
the dull season between cornhusking
and the opening of spring work, as
nearly as possible. Professor Brad­
ford says, “ the courses are packed full
of information regarding farm prac­
tices which every young farmer
needs, such as: judging, feeding, and
the management of live stock, crop
production, rotation of crops, farm
management, and many other courses
which any farmer would find worth­
while.”
The Farm Operator’s Course will
open Monday, November 26, and con­
tinue for 16 weeks, closing March 22,
1929. One week of vacation, De­
cember 22-29, will be given. For con­
venience, the work for each winter is
divided into two terms of eight weeks
each.
Requirements

Requirements for admission are
chat students must be at least 17 years
of age, and everyone is required to
have had at least one year of farm
experience. Students who have com­
pleted the work of the eighth grade
or its equivalent in the common
schools will be admitted without ex­
amination. Special arrangements for
mature men with less than an eighth
grade education will be made upon
application.
Certificates showing the approval of
the College of Agriculture faculty,
will be given students upon the suc­
cessful completion of the two-year
Farm Operator’s Course.
The Farm Operator’s Course is a
regular part of the College of Agri­
culture instruction and the subjects
are taught by members of the Col­
lege faculty. All College buildings,
class rooms, laboratories, shops, and
gymnasiums will be used by instruc­
tors and students in this new course.
The College herds of cattle, hogs, hor­
ses, and sheep will be used for judging
and demonstration purposes, as well
as the poultry farm which affords an
excellent opportunity for a study of
poultry problems.
No rooster would crow very long
if he stopped scratching.
Take advice but do your own de­
ciding.

29
Henry E. Hovey, son of President
Ford E. Hovey of the Stock Yards
National bank of Omaha, has been
elected assistant cashier of the bank.
Henry Hovey has been assistant cash­
ier for the past three years of the
State Bank of Sterling, Colo. He be­
gan his new duties in Omaha Septem­
ber 15.
Omaha livestock and banking in­
terests recently gave a dinner for
William Pier, former vice-president of
the Stock Yards National Bank. Mr.
Pier resigned his Omaha position to
become vice-president of the Stock
Yards National Bank of Fort Worth,
Tex. At the dinner talks were given
by Ford Hovey, Arthur M. Goad and
Herbert Johnson. Richard Laverty
was chairman of the meeting and John
R. Hughes was toastmaster. Mr. Pier
was vice-president of the Omaha
bank for eight years.
Thomas W . Bowers, vice-president
of the National Bank of Commerce of
New York, and State Senator Martin
Saxe, attorney for the New York
bank tax committee, were guests of
the Omaha Clearing House Associa­
tion at luncheon at the Omaha club
recently. The New Yorkers were on
their way to a Pacific coast convention
of tax experts.


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Hold Fifth Annual Com Show
C O R N STA LK sixteen feet ten
and one-half inches in height ex­
hibited by Dave Sullivan of Endicott,
took the cash prize for the tallest corn
at the fifth annual corn show spon­
sored by the Harbine Bank at Fairbury, Nebraska, which took place there
recently. This prize stalk was nearly
two feet taller than the prize stalk in
1923, which held the previous record
and was fifteen feet three and one-half
inches in height. The second prize
was awarded Joe Banahan, also of En­
dicott, whose exhibit was sixteen feet
six inches in height.
A crowd of between one and two
hundred people viewed the measuring
and judging. Perhaps 3,000 people
viewed the exhibits at the bank. The
tall cornstalks reached almost to the
second story windows.
Louis Regnier of Kesterson took
first prize for the longest ear of corn
which measured fourteen and three
fourth inches plus. W . H. Bennett,
Endicott, won second with an ear ex­
actly fourteen and three fourths in­
ches long.
The heaviest ear was exhibited by C.
A. Sheeley, Endicott, two pounds and
two ounces. W . H. Bennett, second,
with an ear weighing two pounds.

Entries this year had from one to
three ears on the stalks, some of the
ears being as high as twelve feet from
the ground. There were one hundred
entries with twenty stalks measuring
more than fifteen feet, 20 ears which
weighed more than one and one-half
pounds, and twenty ears more than
thirteen and one-half inches long.
In speaking of the corn show, H. H.
McLucas, vice-president of the Har­
bine Bank, says:
“ This corn show is something that
we have had for several years back
and we find that sufficient interest is
taken in it by both the farmers and
townspeople to make it worth while.
“ W e keep away from “ quality” so
we do not enter into any controversy
with our good friends regarding which
particular corn is the best. Every year
in the afternoon of our show the side­
walks around the bank are lined with
people. The exhibits remain at the
bank for several days and a great
many local people view them.
“ I do not know that there is anv
particular value to the bank in having
this show except that it keeps our
name favorably before the people of
the community, and it gives us some­
thing new to talk about to our cus­
tomers.’’

FEEDER LOANS
WRITE US

UVE STOCK NATIONAL BANK
Union Stock Yards

OMAHA

BOND INVESTMENTS
Write for Our Attractive List of Carefully Selected Bonds

Central Western Banker, September, 1928

30
In and Out of the South
Dakota Guaranty Law
(Continued from Page 6)

stock of every open state bank in the
state of South Dakota. If there were
any advantage accruing to the insti­
tution that was being assessed this 3
per cent there might be some justifi­
cation for arguing for the continuation
of the assessment, but there is no ad­
vantage. There can never hope to be.
Shall the depositor of the open bank
of this day ask the bank with which
he is continuing to do business and
the bank with which he must do busi­
ness in the future, to assume a burden
for which there can be no compensa­
tion and in the payment of which

SHORT

TERM

there is to be found no reciprocal ad­
vantage to the end that the safety of
the institution of the future and of
the present time is impaired if not
burdened? The bank existing at the
present time has existed in spite of
and not because of the existence of the
Guaranty Law. Shall it be assessed
to pay the losses of banks that have
succumbed under conditions that make
the payment of the assessment an ele­
ment of loss and danger to the de •
positor of the present and future?
The payment of 3 per cent of capi­
tal annually to the Guaranty Fund es­
tablishes the necessity for increased
profits in the institution from which
the payment is demanded. From what
source do these increased profits

INVESTMENTS

UR

FOR

BANKS

sh o rts term

obligations hcvvcu been p u r­
chased by more

6,000

banks in the U nited States.

Walter W . Head, president of the
Omaha National Bank, has returned
from a five weeks’ vacation trip to
Alaska.
F. H. Davis, president of the First
National Bank of Omaha, is home
from a trip to Europe, in which he
spent much time in Italy.

G eneral M otors
A cceptance Corporation
Executive Office y BROADWAY at 5 7 ™ ST. * N ew York City
Capital, Surplus & Undivided
Profits . $52,156,000

a
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Federal Reserve Bank of St. Louis

come? Does not the customer of the
present and of the future have to bear
the burden of the payment of this as­
sessment if the assessment is paid
without impairing the capital stock of
the institution paying? That certain­
ly is true. Shall the charges to be paid
by the customer of the present and of
the future be increased either through
the medium of the decreased interest
rates upon deposits or of increased in­
terest rates on loans for the purpose
of paying an assessment from which
he, the customer, can hope to secure
no possible benefit either now or in
the future?
“ This is the status of the South Da­
kota Guaranty System. Its failure
has not been an incident of South Da­
kota political or economic life alone.
Its history has been the normal history
of similar systems in other states. The
sole question remaining is : Shall
there be a continued assessment upon
existing state institutions the payment
of which involves either the utimate
payment by the customer of the bank
in the present and the future, or the
impairment of the capital stock of
the bank of the present and of the fu­
ture for the purpose of creating a
fund, the distribution of which to the
creditors of the Guaranty Fund by
reason of the bank failures of the past
is so small as to be almost negligible?
Shall there he continued a system that
is a burden not only to the bank of the
present and future but to the customer
of the bank of the present and future,
to all of those who do business with
state banks for the tacitly admitted
purpose of creating a burden which it
is hoped will become so onerous that
assistance may be expected from those
affected in attempting to force the
state of South Dakota to assume the
Guaranty Fund deficit?”

My doctern is to lay aside
Contensions and be satisfied;
Just do your best, and praise or
blame
That foilers that, counts jest the
same:
I ’ve alius noticed grate success
Is mixed with troubles, more or
less,
And it’s the man who does the best
That gits more kicks than all the
rest.

31
,|,|,|||lii|||||,|||||||||||,|||il|||||||||||||||,||,|||||||,|||,l!li,|||||||||||,llll|j|||llllliiii!ll!!llllllllllMllliillllllllllllllllllllllllllllllllllllllllllllll!lllllllllll!l!llllllllllllll'lillllllllllllllllllllllllllllllllllllllllllllllllilllllll'llll

outh Dakota News
iii ii ii i ii ii ii i ii ii ii i ii M i iH M i i ii ii ii i ii iM i iH i i ii ii ii i iu ii ii ii i ii ii ii i ii ii ii M ii ii i ii ii ii i ii ii ii i ii ii ii i ii ii ii i n i ii M i ii i ii ii ii i ii ii ii i t ii i ii ii ii i iM ii ii i ii ii ii i ii ii ii i ii ii ii i ii ii ii i ii M i i ii ii ii i ii ii ii i ii ii ii i ii im im 'ii ii i ii ii im i ii ii ii i ii M i i ii m i

Move to Ohio
Some time, about the first of O c­
tober, F. W. Pierce, assistant cashier
of the First National Bank of Highmore, South Dakota, will move with
his family, to Alliance, Ohio, where he
expects to make his future home.
Mr. Pierce has accepted an offer of
the Stewart Bros. Paint & Oil Co. and
about the first of October he will be­
come identified with this company.
Mr. Pierce and family have been
residents of Highmore for a number
of years, during which time he has
been connected with the First National bank.
Deposits IncreasingFinancial conditions are showing a
steady improvement, it is revealed by
a report made by the Lake Norden,
South Dakota, National bank, which
opened its doors for business July 1.
During the period of two months the
bank obtained more than $72,000 in
deposits. When the crop movement
starts in earnest it is expected it will
not be many weeks before the deposits
are more than doubled, and that with­
in a year from the opening of the
bank, the deposits will be not less than
$250,000 or $300,000.
New Money
To go into circulation probably July
1, 1929, tons of the new bills to be is­
sued by the government, are pouring
from the government presses. The
new currency is said to be of entirely
new design and only two-thirds the
size of the present bills, making for
greater convenience in handling.
It has been the opinion of currency
experts for some time that the many
kinds of currency in circulation were
unnecessary, and that there was no
proper relation between the bills. For

instance, there are now five kinds oi
$10 bills. A system making currency
more convenient and uniform has been
devised, and the result about to be
realized throughout the country.
Adopt Service Charge
The Vermillion County Bankers As­
sociation at its meeting at Vermillion,
South Dakota, recently voted to adopt
the service charge on unprofitable
checking accounts. This makes a to­
tal of 194 banks in South Dakota
which have adopted the charge. At
least the South Dakota Bankers As­
sociation has a record of that many
banks. How many banks have adopt­
ed the charge without notifying the
Association is unknown.
Meet in Huron
About 60 representative bankers
from all parts of South Dakota met
with the Executive Council of the
South Dakota Bankers Association at
Huron
recently. Senator
Martin
Saxe of New York City and Thomas
W. Bowers, vice-president of the Na­
tional Bank of Commerce of New
York City, were present and assisted
in the discussion of taxation with
special reference to the proposed
change to Section 5219 of the United
States statutes.
Max Royhl, attorney for the South
Dakota Bankers Association, will at­
tend the joint meeting of the commit­
tees on State and National Bank Tax­
ation of the American Bankers Asso­
ciation at Philadelphia on October 1.
August Drouth Injurious
August drouth injured corn this
year to an extent seldom recorded, ac­
cording to a report issued by the state
and federal bureau of agricultural sta­
tistics.

On the first of August the unusually
high condition of 93 per cent indicat
ed a record corn crop. The acreage
was large, stands exceptionally good
with few exceptions, and the upper
subsoil was fairly well supplied. Bui
the sudden change to drouthy condi ­
tions with high temperatures and high
winds made too great a demand on the
reserve subsoil moisture
supply.
Heavy stands and growth of shallow
rooted corn made it very susceptible
to injury from the sudden change to
adverse weather conditions.
The damage during the last month
was reported as 31 per cent and the
new forecast predicted a yield that will
be for below normal. All small grain
crops, however, will turn out excep­
tionally well, the report said. The
commercial potato crop wras consider­
ably reduced, and alfalfa and pasture
conditions were reduced heavily also
by high temperatures and August
drouth.
The present condition of corn— 62
per cent— indicates a crop of 197,672,000 bushels as compared to 291,251,000 bushels. O f the leading corn sec­
tions, only about a dozen counties have
promising conditions, the balance
ranging from slight to most severe
damage.
Southwestern and west
central districts have suffered some
injury but have fairly good corn, it
was said.
The condition of spring wheat at
harvest time was 90 per cent and fore­
casted at 3,240,000 bushels against 2,958.000 bushels last year and the fiveyear average of 2,833,000 bushels,
ihis, and the winter wheat crop of
64.372.000 makes a wheat crop of 67,612.000 bushels as compared to 73,826.000 bushels last year.
Oats were rated at 88 per cent at
the time of harvest, which indicates a
crop of 78,936,000 bushels, as com­
pared to 69,813,000 bushels last year
and the five-year average of 79,220,000 bushels. Yields were good except
in north-central counties.

B A N K OF N E W S O U T H W A LE S
AUSTRALIA
P A I D -U P

C A P I T A L ________________

_$ 37,500,000

RESERVE

F U N D ____________________

_

28,350,000

R e se r v e L ia b ility o f P r o p r ie to r s .

_

37,500,000

E S T A B L IS H E D

181 :

____ $103,000,600

$438,905,640

Aggregate Assets 30th September, 1927
A G E N T S — F I R S T N A T IO N A L R A N K , O M A H A , N E B R A S K A
G E N E R A L M A N A G E R . O S C A R L IN E S

HEAD OFFICE, GEORGE ST., SYDNEY

LONDON OFFICE, 29 THREADNEEDLE ST., E. C.

518 B r a n c h e s an d A g e n c ie s in all A u s tr a lia n S ta te s, N e w Z e a la n d , F iji , P ap u a, M a n d a te d T e r r ito r y o f N e w G u in ea
L o n d o n . T h e B a n k C o lle c ts fo r an d U n d e r ta k e s I he A g e n c y o f O th er B a n k s , and tr a n s a c ts e v e r y
d e sc rip tio n o f A u s tr a lia n B a n k in g B u s in e s s .


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and

Central Western Banker, September, 1928

32
past 10 years. Two new vice-presi­
dents were elected, namely, II. W .
Koeneka and J. S. Vance.

Kansas New
To Attend A. B. A.
A number of Kansas bankers are
planning to attend the A. B. A. con­
vention in Philadelphia in a body. The
trip will be made over the Santa Fe
with departure headquarters at Kan­
sas City. Stop-overs will be made at
Detroit, and Niagara Falls with side
trips to Chicago and New York.
Vigilantes Meet
The vigilantes of Osage and Cow­
ley 1 counties, Kansas, have recently
held their usual picnics. The Osage
organization met at Lindon and those
from Cowley County met in Arkansas
City.
Elected President
John Martin has been promoted
from the vice-presidency of the E x­
change State bank of Parsons, Kan­
sas, to the presidency of that institu-

24

Cashier Resigns
J. O. Wilkins, cashier of the Farm­
ers & Merchants Bank at Oxford,
Kansas, has resigned his position be­
cause of poor health. His duties for
the time being will be taken over by
Albert Watkins, who is at present the
assistant cashier.
Report Good Conditions
E. P. Bradley, vice-president of the
American National Bank of Hutchin­
son, Kansas, recently made a trip
through the western part of the state
and reports conditions good financi­
ally in that part of the country.
Named Cashier
H. A. Van Dyke has been elected
cashier of the State Bank of Plaintion. He succeeds the late George
Meier. Mr. Martin has been a mem­
ber of the Board of Directors for the

HourContinuous Service
Always alert, ever ready to serve banks on Safe, Vault
and Timelock Equipment. An organization built on ser­
vice with a personnel of trained experts thoroughly com­
petent to render efficient and satisfactory workmanship
on any make of equipment.
Reduced Rates to Members Under the Ne­
braska and Iowa State Bankers Associations

Fifty-four Field Experts in constant touch with us and
always available to you.

F. E. DAVENPORT & COMPANY
Official Safe, Vault and Timelock Experts for

H. A. Van Dyke has been elected
cashier of the State Bank of Plainville, Kansas. He was formerly con­
nected with the W oodson State Bank.
The Plainville bank is a new institu­
tion which opened recently.
Banker Dies
E. R. Ward, a civil war veteran,
died recently at his home in Wetmore,
Kansas. Mr. Ward was president of
the First National bank of Wetmore
and vice-president of the Goffs Na­
tional bank. He had been associated
with banking for a number of years.
Heads Board
W . R. George, formerly president
of the First National Bank of Garden
City, Kansas has retired from the
presidency and has been named chair­
man of the Board of Directors. Con­
rad Gabriel was elected to the presi­
dency of the institution.
Observes Anniversary
The Riverview State Bank of Kan­
sas City, Kansas, recently observed its
25th anniversary. The capital of the
institution now stands at $100,000 and
has been increased ten times since die
bank was first organized.
County Bankers Meet
The Kingman County, Kansas bank­
ers Association met recently in one of
their regular scheduled gatherings
with all but one of the bankers of the
county represented. The bankers dis­
cussed the farmer and his relations to
what the farmer can contribute to the
community. It was the opinion of the
bankers present that farmers should be
given every possible assistance in
their business.

Nebraska and Iowa Bankers Associations

2061 Farnam Street

Omaha, Nebraska

Telephones: Office, Ja . 1821; Res. Ke 6382 and Ke 3123

The First
National Bank
OF LINCOLN, NEBRASKA

TYPEWRITERS
AND

A D D I N G M A C H IN E S
EVERY IVAK E— I ARGE OR PORTABLE

7 Col.

“ CORONA”

ip V / V /

MAddins
a c h in e s

F. J. WEISS

10 Col.

GEO. F. PINNE

C entral T y p ew riter E x c h a n g e , Inc.
1912 FARNAM ST.

{Established 1903)

Central Western Banker, September, 1928

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

OMAHA, NEBR.

Established

1871

OFFICERS
S. H. BURNHAM, Ch. of Board.
H. S. FREEMAN, President.
P. R. EASTERDAY, Vice-Pres.
W . B. RYONS, Vice-President.
STANLEY MALY, Vice-Pres.
JOE L. BURNHAM, Vice-Pres.
LEO J. SCHMITTEL, Jr. Vice-Pres.
B. O. CAMPBELL, Jr. Vice-Pres.
E. H. MULLOWNEY, Cashier
HOWARD FREEMAN, Ass’t Cashier.
FRED D. STONE, Mgr. Service Dept.

CAPITAL & SURPLUS
$1,050,000.00
ASSETS OVER $14,000,000.00

33
..................................................................................................................................................................................................................... nini..... limimi

Colorado News
............................................mmmimmmmmmmmmmmmmmmmmmm..................................................................... m in...........................umili

Meet in Denver
Directors of the Federal Reserve
Bank of Kansas City met in Denver
recently with directors of the Denver
branch. These meetings are held an­
nually for the purpose of transacting
routine business and getting acquaint­
ed with local conditions.
Directors of the Kansas City bank
who attended the meeting were C. C.
Parks, Denver; F. W . Sponable, Paola, Kans.; E. E. Mullaney, Hill City,
Kan.; J. N. Bernardin, Kansas City;
T. C. Byrne, Omaha; M. L. McClure,
Kansas City; E. M. Brass, Grand Is­
land, Neb.; and William L. Petrikin,
Denver.
The following directors of the Den­
ver branch were also in attendance: H.
Swan, Murdo MacKenzie, H. W .
Farr, Merritt W . Gano, Sr., Robin H.
Davis, Harold Kountze and J. E. Ol­
son.

paid back before they had matured
and interest was rebated.

Savings Increase
Savings deposits in federal reserve
banks in Denver recently showed an
increase of $3,000,000 over previous
deposits, it was revealed in a report
issued from Kansas City.
The seven reporting banks shewed
consistently greater gains than in any
other city and far outstripped the near­
est rival city, Kansas City, Mo., with
nine banks reporting.
Denver, with a population approxi­
mately half of that of the Missouri
city, placed more than $54,000,000 on
deposit, as compared to the $16,600,000 total in Kansas City.
The phenomenal increase was not
matched in any other section of the
10th Federal Reserve District, which
showed a net decrease of 1.4 per cent.
Local depositors led in the number
of accounts with 124,227 reported to
lead by more than 33,000 the Kansas
City record.
Unprecedented demand for com­
mercial and agricultural loans was
adequately and easily met, the report
indicated. Most of these loans were

Clearings Increase
An increase in the bank clearings in
Pueblo, Colorado, for the first eight
months of 1928 show an increase over


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

Growing Rapidly
The new bank building just erected
in Loveland, Colorado, by the First
National Bank, is a credit to both the
bank and the town. It is not often
that as fine a banking home is to be
found outside the larger cities. It is
an evidence of the prosperity of the
bank and the Loveland community and
the substantial basis upon which ihe
business of the bank is conducted.
The First National Bank is a home
institution established in 1905 and has
been growing rapidly since. The first
statement of the bank, issued May 27,
1905, showed total resources of $63,416.00. The resources of the First
National Bank today are approximate­
ly a million and a half dollars.

the same period last year of more
than $3,000,000, according to figures
compiled by R. G. Dun & Co.
The increase in the August clear­
ings of this year over the same month
of 1927 is $258,896.39. This month's
total was $6,325,146.33.
The figures on the year’s clearings
are $47,994,382.48, as compared with
$44,885,848.80; an increase, of $3,108,533.68.
Banking conditions are generally
steady, with slight weekly fluctuation.
Each month has shown a gain over
the corresponding month of 1927.
New Executives
Official announcement was made re­
cently of the appointment of three
new assistant vice-presidents to the
executive staff of the First National
bank of Denver. The new positions
were created to provide a better ex­
ecutive staff, officials said.
H. M. Beatty, former assistant cash­
ier of the First National Bank, W . E.
Fair, former vice-president of the
Bank of Commerce of Sheridan,
Wyo., and previous to that, cashier of
the American National Bank of Chey­
enne, and L. G. Kennedy, until re­
cently national bank examiner, were
named assistant vice-presidents and
have assumed their duties.

N A T IO N A L B A N K O F C O M M E R C E
L IN C O L N ,

M. WEIL,
CARL W EIL, Vice-President
BYRON DUNN, Cashier
C a p ita l

$ 3 0 0 ,0 0 0 .0 0

S u r p lu s

NEBRASKA

President
ERNEST C. FOLSOM, Vice-President
B. G. CLARK, Ass’t Cashier

$ 1 0 0 ,0 0 0

U n d iv id e d

P r o fits

$ 1 0 0 ,0 0 0

9

A Complete Banking Service
The Midland Bank offers exceptional facilities for the transaction
of banking business of every description. Together with its
affiliations it operates over 2400 branches in Great Britain
and Northern Ireland, and has agents and correspondents in
all parts of the world. The Bank has offices in the Atlantic
Liners Aquitania, Ber eng aria and Mauretania, and a foreign
branch office at 196 Piccadilly, London, specially equipped for
the use and convenience of visitors in London.
AMERICAN DEPARTMENT : POULTRY, LONDON, E .C .2

MIDLAND B A N K
LIMITED

HEAD OFFICE:

5

THREADNEEDLE STREET, LONDON, E.C .2

Central Western Banker, September, 1928

34

H av e Y o u H eard Thi s O n e ?
Ach!
“ 1 don’t like de looks of dot jani­
tor,” said Mr. Heinie. “ He tole me
dot he has made luff to effery womans
in dis apartment house except von.”
Mrs. Heine thought a moment.
“ Ya,” she said, “ an’ I betcha I know
who she iss. It’s dot stuck-up Mrs.
Snitzzel opp on der fourth floor!”
A Punning Guide
The sweet young thing turned to a
polite young man who was showing
her through the factory and said,
“ What is that big thing over there?”
“ That is a locomotive boiler.”
“ W hy do they boil the locomotives?”
“ To make the locomotive tender.”
And the polite young man continued
to look straight ahead.
His Eyes Need Attention
“ Poor ole Bill. ’E ’s so shortsighted
’e’s working ’imself to death.”
“ W ot’s ’is short-sight got to do with
it ?”
“ Well, ’e can’t see when the boss
ain’t looking, so 'e ’as to keep on
shoveling all the time.”
At the Auction
The auctioneer, who had been whis­
pering to an excited man in the audi­
ence, held up his hand for silence.
“ I am requested to announce,” he
said, “ that a gentleman here has had
the misfortune to lose a wallet con­
taining five hundred dollars. He o f­
fers a reward of twenty-five dollars to
anyone returning it.”
There was a silence for a moment.
Then a man in the crowd shouted,
“ I ’ll give thirty-five dollars.”
This Holy of Holies
Pat was hired in a lumber office.
The proprietor was a young man and
he decided to have some fun with die
new hand, so Pat was left in charge of
the office, with instructions to take all
orders which might come in. Going
to a nearby store, the proprietor called
up the office.
“ Hello ! Is this the East Side Lum­
ber Company?”
“ Yis, sorr.”
“ Send me up 1,000 knot holes.”
“ Well, now, ain’t that a shame? We
are just out of them. Sold them all to
the vinegar works.”

Sounds Better
“ Doctor, if there’s anything the mat­
ter with me, don’t frighten me half
to death by giving it a long scientific
name. Just tell me what it is in
plain English.”
“ Well, sir, to be frank, you are
lazy.”
“ Thank you, doctor. Now tell me
the scientific name for it. I ’ve got to
report to the missus.”

“ To the vinegar works? What do
they want with them?”
“ They use them for bungholes in
barrels.”

“ Bare” All Right
Two bluejackets were watching the
bathing girls at Atlantic City when one
of them pipes u p : “ Do you think the
girls could wear their bathing suits
much smaller?”
“ I don’t know,” said his shipmate,
“ but there’s a bare possibility.”

That’s Telling ’Em
There was a fearful crash as the
train struck the car. A few seconds
later, Mr. and Mrs. Pickens crawled
out of the wreckage. Mrs. Pickens
opened her mouth to say something,
but her husband stopped her:
“ Never mind talking,” he snapped;
“ I got my end of the car across. You
were driving the back seat and if you
let it get hit, it’s no fault of mine!”

No Sharp-Shooters
“ I see you have a notice, ‘W e aim
to please’,” remarked the irritated cus­
tomer to the chain store manager.
“ Yes,” replied the manager, “ that is
our motto.”
“ W ell,” said the customer, “ you
ought to take a little time off for tar­
get practice.”

Some Bugler
Two soldiers in a negro regiment
were boasting about their company
buglers:
“ G’long wit’ you, boy,” said one;
“ you ain’t got no booglers. W e is got
the boogler, and when that boy wraps
his lips around that horn and blows
pay call, it sounds jest like a sym­
phony band playin’.”
“ Well, if you like music, that’s all
right; but if you is yearnin’ fo ’ food,
you wants a boogler with a hypnotic
note, like we is got. Boy, when Ah
Hear oi’ Custard-Mouth Jones dis­
charge his blast Ah looks at mail
beans and Ah says :
“ Strawberries, behave yo’selves!
General Lee and his surrended at Apout mah dish!”

There Is Still Hope
“ I ’ve been doing duty on these lips
about as long as I want to,” asserted
a lipstick microbe peevishly.
“ Aw, be a little bit patient,” coun­
seled his best friend and severest crit­
ic. “ W e’ve got a good chance of be­
ing transferred.”
How to Get a Rest
Doctor (to wealthy patient) : “ Yes,
you’re all run down. I suggest that
you lay off golf for a while, return to
business, and get a good rest at your
office.”
Advantages of Thinness
“ I’m glad my wife is built long and
thin, sorter like a shoestring, as you
might say,” stated Gap Johnson of
Rumps Ridge.
“ W hy?” inquired an acquaintance.
“ Well, she don’t shade the corn
while she’s hoeing of it like a fat
woman would.”

Did He Catch Cold?
History Teacher: “Tell me about
General Lee and his surrender at Ap­
pomattox.”
Co-Ed: “ General Lee looked oh so
handsome standing erect with a beau­
tiful jeweled sword and clothed in a
gorgeous Confederate full-dress uni­

TH E C E N TR A L W E STE R N B A N K ER OF O M A H A , P u b l i s h e d
416 Arthur Bldg., Omaha, Nebraska
C l iff o r d D e P u y , Publisher

form, while General Grant stood in
front of him clad only in a ragged old
Union suit.”

The Art of Salesmanship

G erald A. S n id e r , Associate Publisher

R. W .

bv

M oorh ead ,

D

e

P

uy

Editor

W m . H. Maas, 1221 First National Bank Building, Chicago, Vice-President

Central Western Banker, September, 1928

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

P

u b l is h in g

Co

m pan y

H. H. H a y n e s , Associate Editor

m)t
Cijase J^attonal Panfc
of the City of New York

HOTELS OF
H OSPITALITY

Capital.....................................................$ 60,000,000.00

(July 2, 1928)

OMAHA

OFFICERS
Albert H. Wiggin
Chairman of the Board

Hotel Fontenelle
L IN C O L N

Hotel Lincoln
S IO U X

John McHugh
Chairman of the Executive Committee

C IT Y

Hotel Martin
CEDAR

Samuel H. Miller
Carl J. Schmidlapp
Reeve Schley
Sherrill Smith
Henry Ollesheimer
Alfred C. Andrews
Robert I. Barr

R A P ID S

Hotel Montrose
S IO U X

FAULS

Hotel Carpenter
And in
L os Angeles,
H otel
Alexandria
$2 Up.

Hotel Chieftain
and E L E V E N
fo r

Your

oth e rs
C o m fo r t

Vice-Presidents
George E. Warren
George D. Graves
Frank O. Roe
Harry H. Pond
Samuel S. Campbell
William E. Lake
Charles A. Sackett

Robert L. Clarkson
President
Hugh N. Kirkland
James H. Gannon
William E. Purdy
George H. Saylor
M. Hadden Howell
Joseph C. Rovensky

Vice-President and Cashier
William P. Holly

C O U N C IL B L U F F S

O p erated

77,000,000.00

Surplus and Profits.............................

by

EPPLEY HOTELS COMPANY

Second Vice-Presidents
Frederick W . Gehle Franklin H. Gates
T. Arthur Pytermas
Edwin A. Lee
Arthur M. Aiken
Ambrose E. Impey
Alfred W . Hudson S. Frederick Telleer Robert J. Kiesling
James L. Miller
Otis Everett
Lynde Seiden
Benjamin E. Smythe W m . H. Moorhead Thomas B. Nichms
Joseph Pulvermacher Harold L. Van Kleeck George S. Schaeffer
Leon H. Johnston
Comptroller
Thomas Ritchie

T H E B A N K E R ’S O P P O R T U N I T Y
Presenting a Fezv of the Possibilities Open to Him
Surplus
Monthly
and
Investment
Salary§
Deposits
Profits
Capital
$
1,000.00
$115.00
$70,000.00
$5,800.00
150
$10,000.00
Missouri
CHA
4,500.00
150.00
60,000.00
1,700.00
500
10,000.00
Oklahoma
WAD
5,000.00
100.00
85,000.00
5,150.00
250
10,000.00
Kansas
DHB
6,000.00
135.00
80,000.00
6,700.00
100
10,000.00
Kansas
GJB
7,500.00
175.00
84,000.00
500.00
600
15,000.00
Oklahoma
KLD
9,500.00
150.00
90,000.00
2,000.00
16,000.00
200
Kansas
PBB
10,000.00
145.00
125,000.00
22,500.00
10,000.00
200
Missouri
HSA
11,000.00
150.00
75,000.00
1,800.00
15,000.00
250
Kansas
K02
11,000.00*
175.00
90,000.00
4,000.00
15,000.00
500
Missouri
JAA
14,500.00
150.00
140,000.00
2,000.00
25,000.00
2,000
Kansas
SMB
15,000.00
175.00
250,000.00
28,000.00
20,000.00
1,500
Missouri
RKA
19,000.00
200.00
200,000.00
13,000.00
25,000.00
500
Kansas
HPB
(2)19,600.00*
240.00
100,000.00
5,500.00
10,000.00
300
Kansas
HRB
20,000.00
150.00
250,000.00
5,000.00
25,000.00
600
Iowa
EBE
20,000.00
200.00
650,000.00
32,000.00
50,000.00
5,000
Missouri
MFA
20,000.00
550,000.00
25,000.00
i
25,000.00
1,800
Missouri
HGA
20,000.00
300,000.00
12,000.00
Î
30,000.00
3,000
Kansas
MMB
20,000.00
175,000.00
Î
25,000.00 10,000.00
600
Oklahoma
VPD
20,000.00
200.00
6,000.00 120,000.00
17,500.00
300
Kansas
BDB
21,000.00
225.00
600,000.00
30,000.00
25,000.00
1,500
Colorado
FLC
21,000.00
200.00
175,000.00
13,000.00
20,000.00
Missouri
400
MRA
24,000.00*
150.00
200,000.00
12,000.00
20,000.00
200
Kansas
KOB
33,000.00
160,000.00
25,000.00
i
35,000.00
10,000
Missouri
MCA
44,000.00
800,000.00
25,000.00
Î
25,000.00
2,000
Kansas
HGB
70,000.00
500,000.00
Î
30,000.00 35,000.00
Large
Kansas
BKB
§Substantial commissions from well established “ side line” business also included in many of above.
'*Includes desirable dwelling.
$Salary to be agreed upon.
State

No.

Size Town

BANKERS BROKERAGE COMPANY
(Successor to the C. C. Jones Investment Company)

919 Baltimore Avenue


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

A LW A YS CONFIDENTIAL— ALL W A YS

Kansas City, Missouri

handled
their items
for half a
century------


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

T h e r e ’ s m a n y a b a n k to
which we may apply this
statement.
Continued patronage is the
best recommendation of the
constant quality of the ser­
vice rendered.

The Omaha
National Bank
SEVENTEENTH

RESOURCES

OVER

F ORTY

MILLIONS