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Die olitnieraal Volume 138 fift 1 ortintriv New York, Saturday, January 20 1934. The Financial Situation HE action at Washington the present week with reference to appropriating for the use of the Federal Government of 40% or more of the gold held by the Federal Reserve banks is, when carefully analyzed, such a discreditable performance that it ought to cause all right-thinking people to pause and to consider how by degrees the moral integrity of the nation is being undermined. There is a question of ethics as well as of economics involved in the proceeding, and bearing in mind what high standards of integrity have always been maintained where anything touched the national honor by all the different Administrations, whatever their political faith, the action now about to be taken cannot be contemplated except with dismay and disheartenment by anyone who loves his country and would forever have it hold unexcelled rank, as in the past, among the civilized peoples of the earth. Since the advent to control of the present Adminis: tration at Washington in March of last year we have already gone far in the other direction, more particularly in the departure from the gold standard and the repudiation of the plighted faith of the nation as expressed in United States obligations to make payment in gold. In addition, now the fixing of an arbitrary value for gold at 60c. on the dollar as the upper limit and the confiscating of the difference of 40c. in comparison with the old value of the gold dollar at 100c. is an act for which no warrant or justification can be found by anyone who feels that nations, like individuals, should ever pursue the right path and never deviate in the slightest degree from the same. Camouflage the proposal as we may,the operation amounts simply to this, namely, that the Federal Reserve institutions hold gold to the amount of between $3,500,000,000 and $4,000,000,000, which is worth 100c. on the dollar, and the Government now seeks to take over the whole amount of these gold holdings and to give the Reserve institutions back gold certificates, secured not by the old dollars worth 100c., but dollars "devalued" so that they will be worth only 60c., or perhaps only 50c., if the process of devaluation is carried to the full limit of devaluation now prescribed. This is simply larceny on a large scale, no matter how those who seek to defend the scheme may attempt to disguise the proceeding. And it should be remembered that the Reserve banks have no say in the matter and are not free to exercise their own volition in the case— which may explain why the Reserve officials are yielding such ready acquiescence to the proposal and are not valiantly fighting it tooth and nail as they T • Number 3578 11 should. As a matter of fact, he Reserve authorities have been reduced to shadowy nonentities, the Federal Reserve System having become simply an adjunct of the United States Treasury and the Federal Government, to do what they are told to do. It would do no good for the Federal Reserve System to put up a stiff fight for the maintenance of the ordinary principles of right and justice. The proposition, as far as the Federal Reserve System is concerned, is simply one of Stand and Deliver. The Government takes 100 cents and gives •back what must not exceed 60 cents, if the limits fixed by Mr. Roosevelt himself are observed. Our people would not tolerate anything of the kind—that is, from an ethical standpoint—in the case of the meanest country in the world, but would characterize it in fitting terms, and we should not look with complacency on action on the part of our officials which we would sweepingly condemn in the Hottentot. It should be clearly understood that this is not a case of seigniorage, as it is looked upon in certain quarters, though Mr. Roosevelt himself is careful not to use this expression. Seigniorage is simply the profit derived from minting operations. In the present instance there is no seigniorage, but simply an arbitrary marking down of the value of the dollar and appropriating the difference. Even so eminent a critic as Dr. 0. M. W. Sprague, who recently resigned as financial adviser to the United States Treasury, seems to look at the difference between the old value of the dollar and the dollar now to be decreed, as in the nature of seigniorage, as he has expressed approval of the Government taking the gold profit from the devaluation of the dollar, instead of leaving it to the Federal Reserve banks, though he had no hesitation in saying that he did not consider that the present move was one calculated to bring about a speedy restoration of international monetary stability. Dr. Sprague said without reserve that he did not "anticipate any decided change in prices or in industrial activity or in the demand for capital and credit as a direct outcome of the policies which have been adopted with regard to our dollar. I believe that we shall find the situation very much as it has been in these respects." He also put the question whether "Our Public Works and Civil Relief expenditure is not being handled in such fashion that it impedes the absorption of labor into private industry." And it should be understood that appropriating 40% of the present gold value does not end the matter. Obviously, if it is within the power of Congress and the Administration to mark the dollar down 368 Financial Chronicle from 100 cents to 60 cents—the process was a deliberate one—it is possible to go further and carry the devaluation process still further. Mr. Roosevelt himself reserves the privilege to cut the value down to 50 cents, but there is nothing to prevent him from changing his mind and asking the present Congress (for the President, under the influence of his advisers in the Brain Trust frequently changes his mind) or some future Congress for authority to shave the lower limit down to 30 cents, or to 25 cents, though it is clearly not his purpose to do anything of the kind at present. Obviously, too, if the process of acquiring the huge stock of Federal Reserve gold is to be effected by paying back gold certificates, these gold certificates may in the end be decreed to have (by Congressional approval) far less real gold than is now contemplated. As a practical matter,too,it deserves to be pointed out that Mr. Roosevelt reserves to himself wide limits of action in the matter of devaluation for the future through reduction of the gold content of the dollar. And our friends abroad should not be overenthusiastic as to the degree of stabilization in international affairs that is to result from the steps now taken. The President, in his message to Congress, made it plain that he does not contemplate any international stabilization in the immediate future, saying: "There is still much confusion of thought which prevents a world-wide agreement creating uniform monetary policy." Again, in arguing that "With the establishment of this permanent policy, placing all monetary gold in the ownership of the Government as a bullion base for its currency, the time has come for a more certain determination of the gold value of the American dollar," he goes on to add that "because of world uncertainty, I do not believe it desirable in the public interest that an exact value be now fixed." However, he thinks that greater stability can be obtained than recent fluctuations have revealed concerning the current value of the dollar. After pointing out that the President is authorized by legislation already on the statute book to fix the lower limit of permissible revaluation at 50%, he goes on to say: "Careful study leads me to believe that any revaluation at more than 60% of the present statutory value would not be in the public interest. I therefore recommend to the Congress that it fix the upper limit of permissible revaluation at 60%." In other words, the President thinks by the proposals he is now making fluctuations of the American dollar in the terms of gold and of foreign currencies can be kept within the range of 50% and 60%. Present indications, however, are that he may fail even in this attempt. This week's experience at least suggests such a possibility. The first effect on Monday of the announcement of what the President contemplated doing was to send foreign exchange rates sharply upward, with the result that the American dollar as expressed in gold took a sharp tumble. But that was simply the immediate response, and since then foreign exchange rates have again turned downward, leading to an advance in the price of the American dollar to above the 60c. high limit—in fact, carrying the rate up to above 62c. The Reconstruction Finance Corporation marked up its gold price from $34.06 an ounce (which had been kept unchanged at that figure beginning with Dec. 18) to $34.45, which is supposed to be the exact equivalent of 60c. for the dollar. The dollar abroad has, Jan. 20 1934 as stated, continued to rule above 62c., which suggests that it is not going to be an easy task to keep the dollar from ruling above 60c., and that extensive operations through the two billion dollar fund which is to be established out of the "profits" taken from the Federal Reserve banks will be a constant requirement. As part of his scheme the President is arguing for greater concentration of power in the hands of the Secretary of the Treasury, his argument on that point being expressed in the following words: "That we may be further prepared to bring some greater degree of stability to foreign exchange rates in the interests of our people, there should b added to the present power of the Secretary of the Treasury to buy and sell gold at home and abroad, express power to deal in foreign exchange as such. As a part of this power I suggest that, out of the profits of any devaluation, there should be set up a fund of two billion dollars for such purchases and sales of gold, foreign exchange, and Government securities as the regulation of the currency, the maintenance of the credit of the Government, and the general welfare of the United States may require. "Certain amendments of existing legislation relating to the purchase and sale of gold and to other monetary matters would add to the convenience of handling current problems in this field. The Secretary of the Treasury is prepared to submit information concerning such changes to the appropriate committees of the Congress." It will be observed that here the purpose is to put the Secretary of the Treasury in complete control of the foreign exchange markets, as to which the only comment to make at this juncture is to say that such a move is deeply to be deplored, since it will mean political control, and political control has always, on trial, been found objectionable in the highest degree, and in such delicate and complicated matters as the regulation of foreign exchange and international money matters would have to be viewed with the gravest apprehension. The President proposes a fund aggregating the huge sum of two billion dollars, but even then, as already indicated, the task may be too difficult to accomplish, in which case the elaborate plan, so carefully worked out, would prove futile. The fund available from the amounts appropriated from the Federal Reserve banks and the Treasury will really run considerably in excess of the two billion dollars which is to serve as the special fund for the occasion. Henry Morgenthau Jr., in an interview that he granted the daily press, stated that the dollar profit on gold, if the 60c. dollar is adopted, would be $2,666,666,666 on the approximate $4,000,000,000 of gold which is now in the Federal Reserve banks or in the United States Treasury. It was indicated that no decision had been reached as to the use to be made of the surplus over the $2,000,000,000 equalization fund to be established. But imagine the Treasury Department having a fund of $2,000,000,000 to juggle with! Mr. Morgenthau also said that in taking over gold from the Federal, Reserve banks gold certificates would be given in exchange, but the metal would not be allowed to circulate. The general supposition, however, is that the profit in excess of $2,000,000,000 will go into the Treasury general fund, where it would be available for such use as the Treasury saw fit to make of it. There are other remarks in the message which indicate that further changes are held as not unlikely Volume 138 Financial Chronicle by the President. Thus we find him saying, with reference to the gold certificates that are to be turned over to the Federal Reserve banks in exchange for the gold that is to be taken from them: "These gold certificates will be, as now, secured at all times dollar for dollar by gold in the Treasury— gold for each dollar of such weight and fineness as may be established from time to time." Again, in speaking of the appropriating as profits, the sum resulting from the arbitrary devaluation of the dollar, he adds the following significant remarks: "It (the Act) would also of course with equal justice cast upon the Government the loss of such dollar value if the public interest in the future should require an increase in the amount of gold designated as a dollar." This last obviously leaves the whole thing open indefinitely, saying, as it does, that the public interest might require an increase again in the gold content of the dollar. NOTHER consideration comes up with reference to the Federal Reserve banks which it is highly important should not be overlooked. Are we not endangering the very existence of the Reserve institutions by the various moves calculated to weaken them, which are growing more and more serious with each new step, and by injecting the Government into every phase of their operations. At one stroke we are denuding them of the equivalent of over $2,000,000,000 of their gold. Last week, through the necessity of turning over to the newlyorganized Federal Deposit Insurance Corporation and subscribing for $139,000,000 of that Corporation's capital stock, we saw the surplus reserves of the 12 Reserve banks cut completly in two, or from, roughly, $278,000,000 to $139,000,000. On the surplus thus turned over they are not to receive one dollar of return, since they will not be entitled to any dividends. In all recent years, the position of the Reserve banks has been steadily weakened, one way or another; as one instance, the liquid character of their assets has been more and more impaired, and the investments they are permitted to make have been extended without much regard to their character, though it is to be said the Reserve has not availed of these questionable functions with the freedom or readiness that they might have done. The action now in depriving them of, roughly, $2,000,000,000 of their gold will be to reduce gold holdings to a corresponding extent. Furthermore, the gold which they will be permitted to retain title is not to remain in their possession, but lodged in the United States Treasury. They will still be required, we imagine, to hold 40% cash reserves against Federal Reserve note issues, and 35% against deposit liabilities, but the gold dollars (or the gold certificates which are to take their place) will be, not 100c. dollars, but 60c. dollars, or less, and, accordingly, these cash reserves will be shaved down to 24% and 21%, respectively. This comes on the eve of the establishment of the Federal Deposit Insurance Corporation, when the member banks are hesitating about retaining their membership in the Federal Reserve System because of the increased liability they will have to assume six months hence, when the present temporary guaranty of deposits is replaced by a permanent system. Will this latest step induce them to stay in the System and assume the greatly extended and heavier liabilities they then will have to assume? Will they A 369 not, on the contrary, be more inclined than before to withdraw from membership and seek to organize outside the System? And if this is done, on any extensive scale, as might easily happen, what will be the effect on the System itself? And, moreover, what will be the effect on the wavering members of the new powers now to be granted the Secretary of the Treasury whereby the Treasury Department will have complete control of the foreign exchange market, acting through the Federal Reserve banks? Many of the larger member banks in the financial centers of the country have exchange departments of their own, which presumably they would have to give up owing to the dominating influence of the Reserve System, even if by chance they should be permitted to continue their own foreign exchange business, which may well be doubted. Is it not more than likely that many of the larger institutions, well equipped financially, will take the chance of carrying on outside the System? What will membership in the Federal Reserve System be worth anyway when the Reserve banks are reduced to mere shells and a goodly portion of their functions taken over by the United States Treasury? At all events, very careful planning will be required to avoid completely wrecking the Reserve System. HE silverites are not entirely satisfied with the President's latest move for stabilizing the dollar. In their estimation the President is not doing enough for silver. Senator Wheeler, for instance, is quoted as saying: "If the President would remonetize silver, it would have much more effect in raising the world commodity prices than cutting the gold content of the dollar. The devaluation and inflationary schemes employed by France, Italy, Germany and Austria did not affect world prices. I intend to keep on pushing my silver remonetization bill." President Roosevelt himself approaches the subject very sympathetically. He is very anxious to placate the silverites, and says: "I issued a proclamation providing for the coinage of our newlymined silver and for increasing our reserves of silver bullion, thereby putting us among the first nations to carry out the silver agreement entered into by 66 governments at the London Conference. This agreement is distinctly a step in the right direction, and we are proceeding to perform our part of it." Apologetically, though, he adds: "I am, however, withholding any recommendation to the Congress looking to further extension of the monetary use of silver, because I believe that we should gain more knowledge of the results of the London agreement and of our other monetary measures." It is difficult to see why any additional recommendation should be called for or why the silverites should not be entirely satisfied with what they have already obtained. The President's proclamation of Dec. 21 gives them practically everything they could reasonably ask for, and for ourselves we cannot perceive how the Administration could go any further in helping along silver. The proclamation virtually authorizes the free and unlimited coinage of silver, which is what advocates of silver are so strenuously contending for. As we have previously pointed out in these columns, it provides for the taking over by the Government and coining into silver of the entire silver production of the United States for the next four years, and absolutely no limit is prescribed as to the extent of this production. The proclamation T 370 Financial Chronicle directs: "That each United States coinage mint shall receive for coinage into standard silver dollars any silver which such mint, subject to regulations prescribed hereunder by the Secretary of the Treasury, is satisfied has been mined, subsequent to the date of this proclamation, from natural deposits in the United States or any place subject to the jurisdiction thereof. The Director of the Mint, with the voluntary consent of the owner, shall deduct and retain of such silver so received 50% as seigniorage and for services performed by the Government of the United States relative to the coinage and delivery of silver dollars. The balance of such silver so received, that is 50% thereof, shall be coined into standard silver dollars, and.the same, or an equal number of other standard silver dollars, shall be delivered to the owner or depositor of such silver. The 50% of such silver so deducted shall be retained as bullion by the Treasury and shall not be disposed of prior to the 31st day of December 1937, except for coining into United States coins." It will be observed that there is here no limit as to the amount of silver to be taken over. The President in his proclamation and accompanying explanation pointed out that by the action of the World Economic and Monetary Conference the United States bound itself to absorb annually at least 24,421,410 ounces of the silver produced in the United States each year during the period of four years, and also pointed out that the silver production of the United States in 1932 had been approximately 24,000,000 ounces. However, according to the terms of the proclamation the mints are obligated to receive all the silver from domestic mines that may be tendered, and that means the full limit of the production, whatever its amount. As we pointed out in our issue of Dec. 30, the low production of 1932 (and that for 1933 will apparently prove still lower) was due entirely to the diminutive prices commanded by silver, but now, with the price fixed at the equivalent of 64%c. an ounce (that is the price at which the arrangement provided works out)—this being 21/ 1 2c. above the market level at the time of the issuance of the proclamation—production is sure swiftly to increase, and on that point it is pertinent to observe that in 1930 the silver production of the United States was 50,748,000 ounces; in 1929, 61,328,000 ounces.; in 1928, 58,463,000 ounces, and in 1927, 60,434,000 ounces. In these circumstances we may be sure that the output of the white metal will be increased to somewhere near the old figures, and possibly even higher. Therefore, we may expect that the mints of the United States will ere long be overwhelmed with supplies of new metal.. What more can the silverites ask for than to have all this provided for—that is, with the mints of the United States ready to absorb it all. As a matter of fact, the new supplies may come in such profusion that the result will be to render it exceedingly difficult for the Administration to keep the fluctuations of the American dollar in gold within the new limits prescribed in the President's message of the present week, that is, between 50c. and 60c. The difficulty will be, however, in preventing a drop below 50c. rather than a rise above 60c. For the fact must not be overlooked that the markets of the world must not only absorb the new supplies of the metal, but also large amounts of old supplies, India having agreed merely not to dispose of over 35,000,000 ounces of accumulated Ian. 20 1934 silver per annum during the period of four years commencing Jan. 1 1934. What more can the advocates of silver reasonably expect? HE weekly condition statement of the Federal Reserve banks the present week are colorless and call for little comment. The changes are entirely along former lines. The holdings of United States Government securities continue unchanged, as has been the case for many weeks past, the amount for Jan. 17 being reported at $2,431,790,000, which compares with $2,431,746,000 on Jan. 10. The holdings of acceptances are again a little lower, at $111,939,000 against $113,211,000, and borrowing by the member banks is also slightly lower at $101,315,000 against $103,692,000, as indicated by the discount holdings of the 12 Reserve institutions. The result is that the volume of Federal Reserve credit outstanding, as measured by the total holdings of bills and securities, stands at $2,646,457,000 as against $2,650,111,000 last week. Further contraction in Federal Reserve note circulation is also again a conspicuous feature, as currency keeps returning from circulation, and the amount of Federal Reserve notes actually outstanding has dropped from $2,998,760,000 last week to $2,959,556,000 the present week, while the amount of Federal Reserve bank notes in circulation has also moved slightly lower, being down from $205,191,000 last week to $204,536,000 the present week. Gold reserves have fallen from $3,566,290,000 Jan. 10 to $3,560,304,000, but a new item this week is the appearance as a separate entry of $4,319,000 of gold held abroad. This represents that amount of gold bought abroad on Tuesday and Wednesday under the new regulations which transferred the gold buying function from the Reconstruction Finance Corporation to the Reserve banks, the change having been inaugurated Tuesday. The member banks, besides reducing some borrowing at the Reserve banks, have also increased their reserve deposits with the Federal Reserve banks, this item having risen during the week from $2,776,857,000 to $2,788,073,000. The latter increase, along with a big increase in Government deposits, served to raise the total of the deposits from $3,007,144,000 to $3,036,890,000. The larger deposits carried with them the need of larger cash reserves, offsetting to that extent the smaller cash reserves required against Federal Reserve note circulation by reason of the diminution during the week in note circulation, and, accordingly, the ratio of total gold reserves and other cash to deposit and Federal Reserve note liabilities combined is a trifle lower this week at 63.5% against 63.6% last week. The amount of United States Government securities held as part collateral for Federal Reserve note issues has further diminished during the week from $564,500,000 to $563,100,000. T CONSPICUOUS favorable feature the present week has been the large number of corporations that have resumed dividend payments or have increased the same. Montgomery Ward & CO. declared a dividend of $5.25 a share on account of accumulations on the $7 cumul. class A stock; the last regular quarterly payment of $1.75 a share on this issue was made on April 1 1932. Julius Kayser & Co. declared a dividend of 25c. a share on common stock, par $5, payable Feb. 15; quarterly distributions of like amount were made on the old common stock of A Volume 138 , Financial Chronicle no par value from May 1 1931 to and including Feb. 1 1932, but none since. (A.) Hollander & Son,Inc., declared a dividend of 12y2c. a share on common, par $5, payable Feb. 15 1934; quarterly distributions of 621/2c. a share had been made from Feb. 15 1926 to and including Nov. 15 1928 on the old common of no par value, but no payments since. People's Drug Stores, Inc., declared a special dividend of 50c. a share on the common no par stock, payable Feb. 1 1934. Austin Nichols & Co., Inc., declared a dividend of 75c. a share on the prior A stock, payable Feb. 1; this compares with 25c. a share paid each quarter from Nov. 1 1932 to and including Nov. 1 1933. The Minneapolis-Honeywell Regulator Co. declared an extra dividend of 25c. a share on common, payable Feb. 15; on Nov. 15 1933 the company paid an extra dividend of 50c. a share, in addition to a regular quarterly dividend of 25c. a share; this latter extra, however, the company had previously announced, was to cover two quarterly dividends which had been omitted during 1933. The Louisville & Nashville RR. declared a dividend of 11/ 2% on the outstanding capital of $117,000,000, payable Feb. 15 1934; the last previous payment, amounting to 2%, was made on Feb. 10 1932; 51% of the capital stock of the L. & N. is owned by the Atlantic Coast Line RR. On the other hand, the Central Power & Light Co. announced that "owing to the continued decline in operating revenues and the resultant reductions in net earnings, due in part to the destruction caused throughout a large part of its territory by the tropical storm in September 1933,the directors on Jan. 15 voted to defer any payment on the 7% and 6% cumul. pref. shares, normally payable Feb. 1 1934. The National Power & Light Co. on Jan. 18 declared a quarterly dividend of 20c. a share on the common stock, payable March 1 1934; this compares with 25c. a share paid each quarter from June 1 1928 to and including Dec. 1 1933. HE New York stock market enjoyed a sharp rise the present week as a result of the action of President Roosevelt in sending a message to Congress on Monday asking for authority to take over the socalled "profit" that will result from taking over the gold holdings of the Federal Reserve banks by devaluing the dollar from 100 cents to 60 cents, the amount of such profit on these holdings,along with the Treasury's own holdings of gold aggregating $2,666,000,000. At the same time he asked for permission to use $2,000,000,000 of such profit in order to establish a fund for conducting operations by the Secretary of the Treasury in foreign exchange and keeping the level of the gold value of the dollar between 50 cents and 60 cents, as the extremes, the purpose being not to let the dollar rise above 60 cents as the outside figure. The President had announced on Sunday night that a message of that kind was coming and accordingly, the stock market on Monday morning opened 1 to points higher in the ease of the active specialties, than at the close the previous Saturday. The advance continued the rest of the day and many issues of stock rose to the highest levels reached in more than two years. In the case of the active specialties the advances for day ranged from 3 points to VA points, this last being in the case of Allied Chemical & Dye. The commodity markets and particularly wheat and cotton responded with similar brisk advances as the dollar suffered sharp depreciation abroad. Stocks continued their upward spurt on Tuesday and Wednesday, though at a T 371 diminishing rate but on Friday swung upward again with great vigor. There have been other favorable developments apart from the action of the President. Dividend increases by corporate entities were one of the gratifying incidents and accounts regarding the state of trade have also been quite generally favorable.. The "American Iron and Steel Institute" reported on Monday that steel operations were back to the high record of 34.2% established four weeks previously on Dec. 18, this comparing with 30.7%, the rate the previous week. Then the production of electricity by the electric light and power industry of the United States for the week ended last Saturday, Jan. 13, was reported at 1,646,271,000 kwh. as against 1,495,116,000 kwh.in the corresponding week of the previous year, being an increase of 10.1%, which is a larger ratio than that recorded in any other recent previous week for a long time past. The production was even in excess of that for the corresponding week two years ago, which also was a new development in recent experience. Car loadings of revenue freight also made satisfactory comparison with other recent periods, the loading for the week ended last Saturday, Jan. 13, being reported at 555,627 cars against 509,893 cars in the same week of 1933, being a gain of 8.9%. The bond market also showed great strength on an enormous volume of transactions and Government bond prices held up well. The United States Treasury 43j-3hs of 1934-45 ranged between 97 26-32 Jan. 11 and 99 15-32 Jan. 3 and closed last night at 99 3-32 against 98 1-32 the close on Friday of last week. As indicating the course of the commodity markets, the May option for wheat at Chicago closed yesterday at 91c. as against 8678c. the close on Friday of last week. May corn at Chicago closed yesterday at 52%c. as against 52/c. the close the previous Friday. May oats at Chicago closed yesterday at 39c. against 37%c. the close on Friday of last week. May rye at Chicago ended yesterday at 63%c. against 603/ 2c. the close on Friday of last week, while May barley at Chicago closed yesterday at 523 4c. against 533e. the close on the previous Friday. Cotton has shown an advancing tendency through nearly the whole week, and the spot price for cotton here in New York yesterday was 11.65c. as compared with 11.05c. on Friday of last week. The spot price for rubber yesterday was 9.37c. against 8.85c. the previous Friday. Domestic copper was quoted yesterday at 8/c. as against 8c. the previous Friday. Silver continued to move within narrow limits. In London 4 pence per ounce as the price yesterday was 193 against 19 5-16 pence per ounce on Friday of last week. The New York quotation yesterday was 44.90c. as against 45.30c. the previous Friday. In the matter of the foreign exchanges cable transfers on London yesterday closed at $5.02% as against $5.08M the close the previous Friday, while cable transfers on Paris closed yesterday at 6.273/2c. against 6.133/ 2c. the close on Friday of last week. Call loans on the New York Stock Exchange again remained unchanged at 1% per annum throughout the entire week. Trading was of more than ordinary dimensions. On the New York Stock Exchange the sales at the half-day session on Saturday last were 749,660 shares; on Monday they were 3,743,480 shares; on Tuesday 3,444,240 shares; on Wednesday 2,848,490 shares; on Thursday 2,126,940 shares, and on Friday 3,542,390 shares. On the New York Curb Exchange the sales last Saturday were 131,250 shares; on 372 Financial Chronicle Monday 545,940 shares; on Tuesday 587,275 shares; on Wednesday 367,255 shares; on Thursday 306,800 shares, and on Friday 473,250 shares. As compared with Friday of last week, prices are sharply higher nearly all around. General Electric closed yesterday at 223/ 2 against 193/2 on Friday of last week; North American at 183/2 against 163/8; Standard Gas & Electric at 934 against 83/2; Consoli5 against 3938; Brooklyn dated Gas of N. Y. at 43% Union Gas at 713/ 2 against 65; Pacific Gas & Electric 19 against 18; Columbia Gas & Electric at 145 % at against 123/ 2; Electric Power & Light at 6% against 53/2; Public Service of N. J. at 40 against 37; J. I. Case Threshing Machine at 773' against 703/ 2; 5 against 3934; Sears, International Harvester at 43% Roebuck & Co. at 463 against 42%; Montgomery Ward & Co. at 263/2 against 223/ 8; Woolworth at 48 3 Western Union Telegraph at 61% against 44%; 7 against 553/2; Safeway Stores at 513/ 2 against 473/2; American Tel. & Tel. at 11834 against 11434; American Can at 1003/2 against 963/g; Commercial Solvents at 33% against 333; Shattuck & Co. at 8%3 against 3 and Corn Products at 7%, 793. against 74%. Allied Chemical & Dye closed yesterday at 153 against 148 on Friday of last week; Associated Dry Goods at 1434 against 123/ 8;E.I. du Pont de Nemours at 993/2 against 9234; National Cash Register A at 203/2 against 18; International Nickel at 223/2 against 5 against 303; 213/ s; Timken Roller Bearing at 33% Johns-Manville at 633/2 against 5732; Coca-Cola at 9834 against 9734; Gillette Safety Razor at 1034 against 93/ s; National Dairy Products at 153 4 against 133/2; Texas Gulf Sulphur at 403/2 against 3834; Freeport-Texas at 463/8 against 433/2; United Gas Improvement at 1734 against 16; National Biscuit at 5 against 463; Continental Can at 803 47% % against 7734; Eastman Kodak at 863/2 against 81; Gold Dust Corp. at 193/2 against 173/2; Standard Brands at 23 against 223/2; Paramount Publix Corp. ctfs. at 33/2 against 23/2; Westinghouse Elec. & Mfg. at 433/2 against 37; Columbian Carbon at 6534 against 60; Reynolds Tobacco class B at 413/2 against 41; Lorillard at 175 / 8; Liggett & Myers class B % against 165 at 84 against 803/2, and Yellow Truck & Coach at 5% against 434. Stocks allied to or connected with the alcohol or brewing group moved upward with the general list. Owens Glass closed yesterday at 8494 against 803/2 on Friday of last week; United States Industrial Alcohol at 5894 against 62; Canada Dry at 27 against 26; National Distillers at 253/2 against 253/2; Crown Cork & Seal at 349/2 against 313/2; Liquid Carbonic at 293/2 against 2834, and Mengel & Co. at 1034 against 73/2. The steel shares were often leaders in the upward 5 surge. United States Steel closed yesterday at 54% against 473/2 on Friday of last week; United States Steel pref. at 963 4 against 90; Bethlehem Steel at 433/2 against 3694, and Vanadium at 253/2 against 22. In the auto group, Auburn Auto closed yesterday at 523/2 against 493/2 on Friday of last week; General Motors at 373/2 against 35; Chrysler at 553/2 against 513/2; Nash Motors at 29%3 against 263/2; Packard Motors at 43/2 against 33/2; Hupp Motors at 63/2 against 5, and Hudson Motor Car at 173 4 against 143/8. In the rubber gtoup, Goodyear Tire & Rubber closed yesterday at 383 4 against 343 4 on Friday of last week; B. F. Goodrich at 153/2 against 133/2, and United States Rubber at 183/2 against 153/2. Jan. 20 1934 The railroad shares were in great demand at substantial advances in prices. Pennsylvania RR.closed yesterday at 36 against 31 on Friday of last week; Atchison Topeka & Santa Fe at 7034 against 5934; Atlantic Coast Line at 483 % against 423/2; Chicago Rock Island & Pacific at 43/2 against 338 bid; New York Central at 385 % against 33%; Baltimore & Ohio at 283 % against 23%; New Haven at 193s against 155 %; Union Pacific at 124 against 1143/2; Missouri Pacific at 43/2 against 334; Southern Pacific at 27 against 203/2; Missouri-Kansas-Texas at 133/2 against 10; Southern Ry. at 3034 against 253/2; Chesapeake & Ohio at 44 against 405 %; Northern Pacific at 283/2 against 223/2, and Great Northern at 2594 against 20%. The oil stocks showed moderate improvement. Standard Oil of N. J. closed yesterday at 4634 against 443/2 on Friday of last wek; Standard Oil of Calif. at 40 against 3834; Atlantic Refining at 31 against 283/2. In the copper group, Anaconda Copper closed yesterday at 1634 against 133 4 on Friday of last week; Kennecott Copper at 213/2 against 19; American Smelting & Refining at 4434 against 433/2; % against 1634; Cerro de Pasco Phelps Dodge at 173 Copper at 353/2 against 3434, and Calumet & Hecla at 534 against 4. RADING was quiet this week on the stock exchanges in the foremost European financial markets, with price trends mixed owing to the uncertainty occasioned everywhere by the various aspects of the American currency plans. Gold mining stocks comprised the only group of issues that showed any definite reaction to the swiftly developing proposals in Washington,these shares advancing sharply because of the increased gold price announced in connection with the provisional stabilization plan. On the London Stock Exchange a long advance in quotations was halted by the new developments, as traders and investors hesitated to increase commitments early in the week. The advance was resumed, however, when a feeling of confidence spread through the market on Thursday. The Paris Bourse and the Berlin Boerse were extremely quiet, with net declines for the week rather more numerous than net gains. Internal developments in most of the industrial countries of Europe were quite favorable. The British Treasury issued a call, late last week,for redemption on April 15 of £105,000,000 4% bonds due 1934 to 1936, and callable this coming spring. It is expected that part of the issue will be repaid from a budgetary surplus, while most of the bonds will be refunded. The British price level is steady, and most business indices remain favorable. In France there is much uncertainty regarding both the political and economic situation, but German reports reflected steady gains in that country. The Italian Government achieved outstanding success, early this week, in the flotation of an issue of 4,000,000,000 lire 4% bonds due in nine years, at a price of 99. The issue was oversubscribed in one day, and in contrast with the practice on an issue some years ago, Premier Mussolini allotted only the amount offered and returned excess applications. The London Stock Exchange was very dull Monday, while further information on American currency developments was awaited. British funds were soft and some recessions also appeared in German bonds, but the list otherwise was fairly steady. South African gold mining shares were active and T Volume 138 Financial Chronicle higher. In the industrial section trends were slightly irregular, with changes small. In further spotty dealings, on Tuesday, gold mining issues attracted most attention, as cables told of the further advance in the American official gold buying price. British funds remained dull, but some of the industrial issues were better. There was liquidation, however, in the issues that might be affected unfavorably by competition with cheap American exports. The international section improved owing to favorable overnight advices from New York. Uncertainty was much in evidence in Wednesday's session. British funds were weak and most industrial issues also declined. Gold mining issues were soft on profit-taking, but the sales were absorbed readily. International securities were generally lower. Conditions on the London market finally changed, Thursday, when an upward tendency was established in most sections of the list. British funds were very firm, and there were also good advances in the gold mining issues, while most industrial stocks showed small gains. The international section enjoyed a rise, which was concentrated largely in Anglo-American trading favorites. In quiet dealings yesterday, British funds again advanced, while most industrial stocks also improved. The international group gained on favorable reports from New York. The Paris Bourse was steady, Monday, notwithstanding the uncertainty on the international currency position and wide fluctuations in the franc valuations of other units. The opening was quiet and uncertain, but a slight upward tendency was established early in the day, and most issues finished with small gains. Activity diminished Tuesday, with the trend somewhat irregular. French securities were generally weaker, with the exception of rentes, which showed small gains. International securities listed on the Bourse improved. The tendency Wednesday was decidedly downward, owing to currency uncertainties. Gold mining issues listed at Paris were better, owing to the similar movements at London, but almost all other securities dropped sharply, on renewed reports that France may be obliged to abandon the gold standard. Recessions were again rather pronounced Thursday, with dealings still on a small scale. Rentes were resistant and showed only small losses, but other issues dropped sharply. The tone yesterday was uncertain, but the gains and losses were unimportant. Prices were soft on the Berlin Boerse in the initial session of the week, but the losses were confined to fractions of a point in most securities. Business was on a small scale and was confined largely to professional operators, reports said. In Tuesday's dealings an uneven tendency was apparent, notwithstanding a generally favorable view of the currency measures taken in Washington. A few issues were marked up, but the great bulk of securities listed on the Boerse showed small losses. Liquidation was general in Wednesday's dealings on the German market, and losses ranged up to 3 points in the more active issues. Bonds as well as stocks were sold, while a few textile issues showed a contrary tendency. Business on Thursday was extremely dull, and the downward tendency of quotations was resumed. Bond prices reflected only nominal changes, while most equities also showed fractional losses. A few industrial specialties were in demand, and such stocks resisted the general trend. The 373 trend was generally favorable yesterday, with bonds in better demand than stocks. TN EUROPEAN capitals there was calm acceptance 1 of the formal moves at Washington, Monday, for the definite devaluation of the dollar to between 50% and 60% of its former value, and the setting up of a $2,000,000,000 fund for exchange stabilization. Some aspects of the proposals of the Administration at Washington were viewed critically, but others occasioned little comment. The implied suggestion in some official comments on this side that there might be a currency war found no echo in any European capital. On the contrary, every indication was given that the American currency experiment will meet with no such untoward obstacle as an official attempt by any European Government to influence the course of the dollar in the foreign exchange markets. This tendency was especially reassuring in view of the comments by Secretary of the Treasury Henry Mqrgenthau Jr., regarding the "game" of exchange dealings. "When we go in to play this game, we want a fund that will permit us to play the game as everybody else is doing," Mr. Morgenthau declared on Monday. "We want to have as much as Great Britain or anybody else," the Secretary added, when explaining the need for the $2,000,000,000 fund. The highly significant statement was made in a London dispatch of Tuesday to the New York "Times" that the British equalization fund of £350,000,000 has never been used to buy dollars since the United States dropped the gold standard early last year. Nor is there any expectation in authoritative quarters, the report added, that the British fund will be used to purchase American currency now that the dollar is to be depreciated officially. These statements were made, it was indicated, in answer' to a question whether the British and American exchange funds might be used in a battle of currencies. It was pointed out that Chancellor of the Exchequer Neville Chamberlain had assured the House of Commons last May, when the British fund was increased to £350,000,000 from £150,000,000, that the increase had nothing whatever to do with the American departure from the gold standard. "That is still the attitude of the British Government," the dispatch added. If the depreciated dollar results in a flood of cheap American exports to Great Britain, the London Government might consider the advisability of imposing anti-dumping duties, but that contingency has not yet arisen and may never arise, it was remarked. In British banking circles grave doubts were expressed regarding the effects of President Roosevelt's devaluation policy, as the ramifications and consequences on international trade are bound to be far-reaching. It was confidently predicted that the British authorities will make no move toward stabilizing sterling for some time to come, as the dollar is believed in London to be greatly undervalued at present in relation to the British currency unit. French monetary policy will not be affected by the moves made in Washington, according to statements made in authoritative circles in Paris on Tuesday. There was relief over the relative stability of the dollar indicated in the devaluation program, but some anxiety also was expressed regarding a possible heavy return flow of American capital to New York. 374 Financial Chronicle It is well known that. much refugee capital from other countries has been lodged at Paris in recent months, and French banking and Government circles are hopeful that such funds will not tend to flow out too quickly. In a Paris dispatch to the New York "Times"it was remarked, however, that French officials see no reason for the devaluation of the franc, and they are said to have no intention of joining any international conference designed to bring about such devaluation. It is fully expected that there will be another heavy gold drain from France, but French authorities hope to recoup some of the losses through a compensating flow of the metal from Holland and Switzerland to Paris. At Basle, Switzerland, where officials of the Bank for International Settlements rapidly gathered opinions from all European capitals on the American developments, it was remarked that there is both good and bad in the devaluation proposal. Fixation of the dollar at a range between 50% and 60% of its former value was regarded as at least a step toward formal stabilization, and it was welcomed for that reason. Appropriation by the United States Government of the "profit" involved in devaluation occasioned no surprise, but it was pointed out that this measure has the nature of a capital levy of 40% to 50% on the American people. Assumption by the Government of the ownership of the gold of the Federal Reserve System was deplored as a most unfortunate backward step, which may set a "bad example to less stable governments." At one stroke, it was pointed out, the United States Govern ment has counteracted the trend of decades toward freeing monetary systems and central banks from the political control which has so often,exerted an unfortunate influence on monetary arrangements. Direct reports from Berlin indicate that the American developments were viewed favorably in Germany, as stabilization of currencies long has been regarded there as the first vital step tOward world trade recovery. Finance Minister Jung, of Italy, expressed the determination of the Italian Government, Tuesday, to maintain the lira at its present 'elation to gold, an Associated Press dispatch from Rome said. HERE is likely to be a considerable divergence of opinion at the meeting in Berlin, next Monday, in which representatives of the holders of longterm external German bonds will discuss with Reichsbank officials the arrangements for transfer during the first six months of this year of only 30% of interest due, with payment of the remaining 70% to be made in scrip redeemable at half its face value in foreign currencies. Laird Bell and John Foster Dulles, as the American participants in the conference, issued a statement last Saturday,just before their departure for Germany, in which they emphasized that the conference has been called for the specific purpose of considering the requests of the Swiss and Dutch Governments for special arrangements whereby, in exchange for granting additional trade facilities, their holders of German bonds would be paid in full. Similar arrangements were in effect with these countries last year, and Dr. Hjalmar Schacht, President of the Reichsbank, agreed to call a meeting of all creditors if any further requests for such favored treatment were received. The German invitation to the conference limited the topic of discussion to this aspect of the matter, it was stated, T fan. 20 1934 but it was considered probable that the creditor? representatives would bring up the matter of the reduction of interest transfers from 50% cash and 50% scrip. London dispatches of Monday indicated that a banking committee would be sent to Berlin to represent the interests of British long- and medium-term bondholders. A further vigorous protest will be made to Dr. Schacht against the reduced interest transfers, a dispatch to the New York "Times" said. But there will be no tendency to attain the British ends by threats to Germany concerning trade or credits, it was added. It was suggested,indeed, that British representatives may not even protest against special arrangements with Switzerland and Holland for 100% payment of the creditors of those countries in exchange for larger imports of German goods. "It is admitted in London that there is some practical advantage in it for other countries, inasmuch as it gives Germany an added supply of florins and Swiss francs which can be converted into dollars. and pounds to help make payments to the United States and Great Britain," the report said. Up to a point, it was indicated, Switzerland and Holland must pay for their increased takings of German goods with florins and,francs, and it is this factor which operates to the benefit of the creditors in other countries. In contrast with the London statements, however, Messrs. Bell and Dulles declared last Saturday that preferential arrangements such as those with Holland and Switzerland "are definitely prejudicial to the interests of the American bondholders." Dispatches from Berlin indicate that Dr. Schacht is not likely to be impressed by any further' protests from American or British representatives against the curtailment of interest payments in foreign currencies. OPELESS confusion continues to prevail in the discussions of peace and disarmament currently taking place among the chief countries of Europe. Direct conversations between the French and German Governments constitute the most important aspect of this matter, but as information on the respective positions of these Governments is made available, it would hardly seem that any genuine progress toward disarmament will result. The Bureau or Steering Committee of thq General Disarmament Conference is scheduled to resume next week its consideration of the general problem. This matter was discussed in Geneva, Thursday, by the many statesmen who assembled for the League Council meeting, but the inclination was again toward adjournment. The opinion was expressed in some quarters that the direct talks between France and Germany may take until Easter. Until they are concluded there is no prospect whatever of any kind of agreement at the General Disarmament Confer- • ence, and that gathering probably will not be reconvened as a whole for some months to come. In the direct negotiations between France and Germany the initiative was taken early in December by Chancellor Hitler, who outlined his ideas to the French Ambassador, Andre Francois-Poncet. A French response was made in a memorandum which was sent to Berlin, on Jan. 1, and a reply to that communication is still awaited. Although the contents of the French note were carefully guarded, it was indicated Thursday that it lists some points which will certainly not be acceptable to Germany H Financial Chronicle Volume 138 unless extensively revised. It is for this reason that the political leaders at Geneva believe the discussions may take some months, if they do not break down altogether. The French insist, an Associated Press dispatch stated, that any consideration of German army strength must take into account police and other organized forces, such as the Nazi Storm Troops. It is also maintained by France that there must be two disarmament phases. Although this point is referred to only briefly, it appears to coincide with previous French ideas of a preliminary period of supervision and control and a later period of modest disarmament by France and modest rearmament by Germany. Willingness has been expressed by the French to halt their land armaments at the present level and not build them up further, while destruction of half the present air bombing equipment of the country is suggested, provided other nations follow suit and an international air force is established under supervision of the League of Nations. The French Cabinet considered the armaments negotiations in several meetings this week, while some attention also was given the matter by the British Cabinet. At the meeting in London, Tuesday, Foreign Secretary Sir John Simon outlined the results of his recent discussions in Paris and Rome. No indication was made available of any new conclusions by the British Ministers. The French Foreign Minister, Joseph Paul-Boncour, reported to the Senate in Paris, Tuesday, that France is neither disquieted, nervous, nor discouraged. "If the Disarmament Conference fails," said M. Paul-Boncour ominously,"the armaments race will recommence, and if we must abandon the idea of international security by co-operation, then we will take every measure to secure our own security." Premier Camille Chautemps continued the discussion before the Senate on Thursday. He hinted broadly that the United States should abandon its attitude of neutrality and aloofness from European affairs. France agrees with President Roosevelt, he said, that no country should seek to increase its armaments and that a durable peace will be secured only when every nation agrees no longer to have recourse to aggression. "We can only hope the President will go further," he added, "and admit, now that aggressive warfare is outlawed, that no country can ,remain neutral in the face of an aggressor." 375 could send representatives to participate, and an invitation was promptly telegraphed to the Wilhelmstrasse. Germany declined the invitation in a brief response, and the Saar plebiscite discussion continued on Tuesday, when protests were published from German organizations in the Saar against actions of G. G. Knox, the British Chairman of the League's Saar Governing Commission. Additional communications, published Wednesday, contained some that urged postponement of the plebiscite, owing to an alleged Nazi campaign of terrorism. It was decided in that session to reappoint the entire Governing Commission of five members. The question of the reform of the League organization was raised Tuesday, owing to receipt of a communication from Holland in which the Government of that country urged continuance of the present Covenant, unchanged. "The Covenant now offers ample possibility of achieving the League's objects, provided its members are actuated by a spirit of collaboration," the communication from The Hague stated. The note made a strong impression in Geneva, dispatches said, but there was little general discussion of the matter. Early in the week the Council decided to send to all governments a proposed radio broadcasting convention, which would prohibit "messages intended for the population of another State, and constituting a menace to the peace or internal security of that State." Also on the agenda of the present Council session is the Chaco boundary dispute between Bolivia and Paraguay. OLITICAL instability in Cuba was reflected this week in two rapid changes of government,from which Colonel Carlos Mendieta emerged as President, Thursday, with the apparent support and cooperation of most of the divergent factions, including the Cuban Army and Navy. Dr. Ramon Gran San Martin, who had recently made arrangements, as President, for a Constituent Assembly and for his own relinquishment of power to the Assembly, resigned his office early last Monday. The resignation was presented, an Associated Press dispatch from Havana said, to the original military junta of 19 which forced Machado out of the Presidency last August and thus precipitated the series of changes. A military coup, said to have been engineered by Secretary of the Interior Antonio Guiteras, forced Dr. Grau to make his quick decision, the dispatch HE Council of the League of Nations assembled indicated. Carlos Hevia, who was Secretary of at Geneva, Monday, for one of its regular ses- Agriculture in Dr. Gram San Martin's Cabinet, was sions, which now take place every four months. The first chosen for the Presidency, and he was duly inCouncil meeting was the seventy-eighth since the augurated late Monday. Senor Hevia indicated that League was formed, but it was the first since Ger- the policy of his predecessor to convoke a constitumany withdrew from all League activities, and the tional convention would be followed by his own absence of the German representatives occasioned a Government. He remained in office, however, only rather gloomy atmosphere. Recent suggestions by until early Thursday, when the Presidential mantle Italy for reform of the League added to the pessi- was given to Dr. Carlos Mendieta, 64-year-old mism. Some important matters were on the agenda, physician. however, and the Council promptly started its delibPresident Mendieta is regarded as one of the most erations. The question of a plebiscite in the Saar popular of the political leaders in Cuba, and all area, to determine whether that basin is to become Havana reports indicate that he was "drafted" for German or French territory or is to remain under the office by the virtually unanimous consent of the League control was taken up Monday. The ple- numerous parties in the faction-torn Island. There biscite must be held in 1935, and it was understood is some hope, accordingly, that it will now- prove posthat the necessary arrangements would be giscussed sible to stabilize the internal affairs of Cuba. It was at this time. Rene Massigli, of France,informed the pointed out in Havana that since Dr. Mendieta is Council that he considered it advisable to inform the choice of all Cubans, there is no longer any reaGermany of the impending discussion, so that Berlin son why recognition should be withheld by the _ P 376 Financial Chronicle United States Government. The first statement by the new President, after the inaugural ceremony, was a message to the people of the United States, in which the hope was expressed that "Cuba may base herself on an order of reason and justice." Jefferson Caffery, personal representative of President Roosevelt in Cuba, issued a statement at the same time in which he remarked that he has "confidence in the patriotism of the Republic's leaders and confidence that their principal interests will be the service of their compatriots, and that their efforts will be directed toward bettering the lot of her people on the plantations, in the factories and in their homes." To the political confusion in Cuba in the first half of this week was added general economic stagnation, as all business was suspended. A general strike was called and it was fairly effective until Thursday, when the workers began to return. Jan. 20 1934 Moscow, Tuesday, that negotiations for the sale of the Chinese Eastern Railway by Russia to Manchukuo would be resumed. Discussions on this matter were started at Tokio last year, but they were discontinued in October, after the arrest of six Russian officials connected with the operation of the line. There was much informal discussion in Japan, thereafter, of an "imminent Russo-Japanese war," and Japanese generals even now are said to consider such a conflict inevitable. Arrangements for the sale of the Chinese Eastern would be especially welcome in these circumstances, and the announcement that•the conversations will be resumed already has clarified the atmosphere to a degree. Foreign Minister Koki Hirota, of Japan, and the Soviet Ambassador, Konstantin Yureneff, conferred on the matter last Monday, and the release of the six Soviet railway officials was decided upon as a preliminary step toward resuming the negotiations. It is suggested ECRETARY OF STATE CORDELL HULL will in Tokio reports that Japan and Russia may reach terminate to-day his good-will tour of the chief an agreement in principle on the sale of the railway Latin American countries, undertaken in connection before Manchukuoan officials are called in. The with his journey to Montevideo for the sessions of railway was built with Russian capital during the the seventh Pan-American Conference. Mr. Hull Czarist regime and was operated jointly by Russia visited Rio de Janeiro early in December, before and China until Japan occupied Manchuria and set proceeding to Montevideo. After the Conference up the puppet-State of Manchukuo. ended, on Dec. 26, he went to Buenos Aires. CrossThe long-discussed plan for establishing a Kinging to the West Coast,the Secretary touched at San- dom in Manchukuo and placing on the throne Henry tiago, Chile, and Lima, Peru, and reached the Canal Pu Yi, of the deposed Ching dynasty of China proper, Zone on Wednesday. The final stage of the tour was appears at length to be on the point of fruition. A quickly completed on the cruiser Richmond, Mr. Hull spokesman for the Japanese legation at Peiping inelecting to hasten his return to Washington in order dicated, Tuesday, that the youthful Henry Pu Yi to take up negotiations for reciprocal trade treaties would be crowned Emperor of Manchukuo on with Latin American countries. In a wireless dis- March 1 "in order to define clearly Manchuria's inpatch of Tuesday to the New York "Times," from dependent status, which concurs with Japanese the steamship Santa Barbara, it was indicated that policy." The best method of dispelling the notion Mr. Hull had decided to transfer from that vessel that the new State is a Japanese colony, the Japato the speedier cruiser, owing to his belief that the nese authorities decided, would be to "satisfy the move toward formal stabilization of the dollar would earnest hope of the Manchurian people for the enafford the necessary impetus for revival of American thronement of Pu Yi," the Japanese spokesman foreign trade through a series of bilateral trade naively declared, according to a dispatch to the New agreements. It will now be possible to calculate, York "Times." At Changchun, the capital of Manthe Secretary declared, the values of commodities chukuo, the Emperor-designate stated Wednesday in terms of the dollar for some time to come, and that his policy will be one of peace and security, the prospect of agreements on trade matters is corre- international amity and the observance of all forspondingly enhanced. eign obligations. "I will keep open the door of comHe disclosed that conversations with Chile had merce to all nations," he continued. "Whether been started, and expressed the belief that negotia- Washington recognizes Manchukuo or not, Amertions with at least a half dozen other Latin American icans will be always welcome in Manchuria." States could be undertaken. A treaty with Colombia already has been signed, while negotiations with EVERE destruction was wrought, and many Argentina and Brazil are said to be progressing lives lost, in an earthquake that rocked all of satisfactorily. Mr. Hull was warmly received in all India, Monday, causing especially serious damage the Latin American capitals which he visited, and in in a wide area of North Central India. A number almost every case he was asked to impress upon of towns in the North Bihar district were almost creditors in the United States the economic diffi- wiped out, and many Europeans, as well as Indians, culties being encountered in all countries and the are believed to have lost their lives. The extent of need for a considerate attitude toward debtors. the destruction over the great area affected has not President Oscar Benavides, of Peru, went so far as been estimated as yet, owing to the breakdown of all to state that the creditor is under a moral obligation communications. Several airplanes were dispatched to aid the debtor in fulfilling his engagements. to survey the territory which could not be reached otherwise, and they returned to Calcutta with reONCILIATORY moves in the Far East have ports of inundations, huge fissures in the earth, and lessened somewhat the tension between Japan the sight of thousands of bodies in the fields and and Soviet Russia, and the danger of an armed clash ruined towns. Captain Frederick Dalton, who between these Powers has been correspondingly piloted the first airplane to fly over the stricken diminished. It is generally believed that the im- area, said he believed the dead must total between provement dates rather definitely to the recognition 8,000 and 10,000. After making all allowances for of the Soviet Russian Government by the United errors in his calculations of death lists, it would still States. Announcement was made at Tokio and seem that the earthquake caused immense devasta- S S C Financial Chronicle Volume 138 377 tion in the thickly populated area, a Calcutta dis- culation show a large decrease, namely 1,409,000,000 patch to the United Press stated. Relief agencies francs. Circulation now aggregates 80,839,379,420 were hastily mobilized, in view of these reports, and francs as compared with 83,590,847,140 francs last every effort was made to succor the inhabitants of year and 84,008,409,105 francs the previous year. the stricken district. The proportion of gold on hand to sight liabilities stands now at 79.24% as compared with 78.01% a HERE have been no changes this week in the year ago. Below we furnish a comparison of the discount rate of any of the foreign central various items for-three years: banks. Present rates at the leading centers are BANS OF' FRANCE'S COMPARATIVE STATEMENT. shown in the table which follows: Chances T DISCOUNT RATES OF FOREIGN CENTRAL BANKS. Country. Rata fn Effect Date Jan.19 Established. Austria-Belgium- __ Bulgaria_ _ _ Chile Colombia_ Czechoslovakia____ Danzig_ _ _ _ Denmark. . England__ Estonia____ Finland__ France_ _ __ Germany__ Greece Holland__ PreMotu Rate. 5 3% 7 431 4 Mar. 23 1933 Jan. 13 1932 Jan. 3 1934 Aug. 23 1932 July 18 1933 6 2S1 8 514 5 334 4 234 2 514 434 234 4 7 234 Jan. 25 1933 July 12 1932 Nov 29 1933 June 30 1932 Jan. 29 1932 Dec. 20 1933 Oct. 9 1931 Sept.81 1932 Oct. 13 1933 Sent.18 1933 434 5 3 234 fiSi 5 2 5 734 3 Country. for Week. Rate In Effect Dale Jan.19 Established. Preaims Rate, Hungary.-- 434 Oct. 17 1932 5 33i Feb. 16 1933 4 India Ireland_ _ __ 3 June 30 1932 314 3 Dec. 11 1933 314 Italy Japan 3.65 July 3 1933 4.38 Java 434 Aug. 16 1933 5 Lithuania 8 Jan. 2 1934 7 Norway.... 334 May 23 1933 4 Poland.__ 5 Oct. 25 1933 6 Portugal 534 Dec. 8 1933 6 Apr. 7 1933 6 Rumania 6 Feb. 21 1933 7 South Africa 4 Oct. 22 1932 534 Spain 6 Sweden_ _ _ _ 234 Dec. 1 1933 3 Jan, 22 1931 Switzerland 2 Si In London open market discounts for short bills on Friday were 1%, as against 15-16% on Friday of last week and 1®1-16% for three months' bills, as against 15-16®1% on Friday of last week. Money on call in London yesterday was 4 3 %. At Paris the open market rate remains at 23L% and in Switzerland at 13/2%. HE Bank of England statement for the week ended Jan. 17 shows a loss of £10,109 in bullion, but as this was attended by a contraction of £7,358,000 in circulation, reserves rose £7,348,000. The Bank now holds £191,686,153 gold in comparison with £120,570,654 a year ago. Public deposits rose £97,000, while other deposits decreased £2,425,846. The latter consists of bankers' accounts, which fell off £2,501,562 and other accounts, which increased £75,716. The reserve ratio rose sharply from 45.17% a week ago to 50.06% this week; a year ago the ratio was 27.27%. Loans on Government securities decreased £9,406,000 and those on other securities £248,934. Of the latter amount, £39,709 was from discounts and advances and £209,225 from securities. The discount rate remains 2%. Below are comparisons of the different items for five years: T BANK OF ENGLAND'S COMPARITIVE STATEMENT 1934. Jan. 17, Circulation-a Public deposits Other deposits Bankers' ac000nts_ Other accounts Government secure_ Other securities Disct.,k advances_ Securities Reserve notes & coin_ Coln and bu1lion__ Proportion of reserve to liabilities Bank rate 1933. Jan. 18. 1932. Jan. 20. 1931. Jan. 21. 1930. Jan. 22. £ £ E £ £ 365,837,000 354,663,728 347,878,781 346,461,899 346,399,540 19,366,000 12,116,196 20,813.259 22,323,852 29,151.416 152,088,832 137,885,403 115,925,709 102,197,129 95,960,328 114,981,108 105,380,987 77,481,720 68,812,580 59.948,356 37,107.724 32,504,416 38,443,989 33,384,549 36,011,972 81.770,692 96,552,390 52,430,906 49.246.247 57.665.855 21,924,570 30,623,352 53,951,564 36,953,788 20,658,442 8,268,075 11,819,357 14,031.271 10,994,845 5.779,566 13,656,495 18,803,995 39,920,293 25,958,943 14.878,876 85,849,000 40,906,926 48,442,390 56,399,867 64,889,435 191,686,153 120,570,654 121,321,171 142,861,766 151.288,975 45.29% 51.86% 35.42% 27.27% 3% 5% 6% 2% a On Nov. 20 1928 the fiduciary currency was amalgamated with Bank of England amount of Bank of England the £234,199,000 to note issues adding at that time notes outstanding. 50.06% 2% HE Bank of France in its weekly statement dated Jan. 12, shows an increase in gold holdings of 13,462,669 francs. The Bank's gold now stands at 77,254,004,794 francs a year ago and 69,846,822,715 francs the year before. Credit balances abroad and creditor current accounts reveal increases of 1,000,000 francs and 1,031,000,000 francs while French commercial bills discounted, bills bought abroad and advances against securities fell off 206,000,000 francs, and 32,000,000 francs respectively. Notes in cir- T Jan. 12 1934. Jan. 13 1933. Jan. 15 1932. Francs. Francs. Francs. Francs. +13,462,669 77,254,004,794 82,404,571,779 69,846,822.715 +1,000.000 16,561,445 2,944,907,580 10.405,672,098 Gold holdings Credit bale. abroad_ a French commercial bills discounted —206,000,000 4,026,040,609 2,642,814,452 5,528,075,094 b Bills bought abr'd_ —1,000,000 1,128,503,045 1.522.748,617 10,101.418.635 Adv. agent secure —32,000,000 2,949,269,965 2.601,786,261 2.866,732,106 Note clrculat.on__ _ —1,409,000,000 80,839,379,420 83,590,847,140 84,008.409,105 Cred. curr. accounts +1,031,000,000 16,657,151,010 22,045,748,066 28,133,458,608 Proportion of gold on hand to sight li.hilitiaq -I-11 32%, 7024°7 7801 5228G. a Includes bills purchased In France. b Includes bills discounted abroad. HE Bank of Germany in its statement for the second quarter of January reveals a decrease in gold and bullion of 5,716,000 marks. The Bank's gold is now 383,474,000 marks as compared with 801,127,000 marks last year and 966,241,000 marks the previous year. A decrease appears in reserve in foreign currency of 2,414,000 marks, in bills of exchange and checks of 193,003,000 marks, in other assets of 9,402,000 marks and in other daily maturing obligations of 38,691,000 marks. The proportion of gold and foreign currency to note circulation is now 11.7%, a year ago it was 28.2% and two years ago, 25.6%. Notes in circulation contracted 112,046,000 marks the total of which is now 3,354,083,000 marks. A year ago circulation aggregated 3,270,835,000 marks and the year before 4,381,554,000 marks. Silver and other coin, notes on other German banks, advances, investments and other liabilities register increases of 52,020,000 marks, 2,979,000 marks, 1,445,000 marks, 5,131,000 marks and 1,777,000 marks respectively. A comparison of the various items for three years appears below: T REICEISBANICS COMPARATIVE STATEMENT. Changes for Week. Assets— Gold and bullion Of which depos.abroad_ Res've In for'n currency Bills of exch.& checks Silver and other coin Notes on other Ger. bks Advances Investments Other assets Liabilities— NOW In circulation 0th.daily matur. obliff.. Other liabilities Propor. of gold & for'n curr. to note eireu-'n. Jan. 15 1934. Jan. 14 1933. Jan. 15 1032. Retchsmarks. Reichsmarks. Retchsmarks. Reichniarks. —5,716,000 383,474,000 801,127,000 966.241,000 33,091,000 93,912,000 No change. 43,019,000 —2,414,000 8,041,000 119,733.000 154,843,000 —193,003,000 2,779,000 2,406,238,000 3,610,979,000 +52,020,000 288,981,000 283,221,000 177,529,000 11,656,000 8,082,000 +2,979,000 12,670,000 +1,445,000 64,122,000 71,378,000 108,486,000 +5,131,000 596,198,000 398,188,000 160,645,000 —9,402,000 527,967,000 857,012,000 937.904,000 —112,046,000 3,354,083,000 3,270,835,000 4,381,554,000 —38,691,000 456,970,000 353,423,000 384,316,000 +1,777,000 226,281,000 756,870,000 871,508,000 +0.2% 11.7% 28.2% 25.6% EALINGS in the New York money market this week were of a routine nature, no changes in rates being reported in any department. Charges for accommodation remain phenominally low, owing to the pervasive influence of the open market operations of the Federal Reserve System. Excess reserves now are increasing sharply, and ordinarily this, would tend to ease rates still more, but the prospect of an extraordinary volume of new Treasury financing is operating as an offset, and the tendency everywhere is to await developments. Call loans on the New York Stock Exchange were 1% for all transactions of the week, whether renewals or new loans. In the counter or street market some transactions in call money were reported every day at from the official rate. Y i%, or a concession of 4% 3 Time money was quiet and unchanged. An issue of D Financial Chronicle 378 $125,000,000 91-day Treasury discount bills was awarded Monday at an average discount of 0.67%, this figure comparing with the rate of 0.62% on an issue of $100,000,000 awarded a week earlier. The larger totals of the Treasury bill issues are tending to enlarge the discount. Brokers' loans against stock and bond collateral increased $12,000,000 in the week to Wednesday night, according to the usual statement of the Federal Reserve Bank of New York. EALING in detail with call loan rates on the Stock Exchange from day to day, 1% remained the ruling quotation all through the week for both new loans and renewals. The market for time money is practically unchanged this week, as there has been very little business available except in renewals for short periods. Rates are nominal for 4 at 1@13. 4 % for 60 and 90 days and 13.@1% four,five and six months. The market for commercial paper has been moderately active this week, though paper has been short of requirements. Rates are 1Yi%for extra choice names running from four to six months and 13/2% for names less known. D HE market for prime bankers' acceptances has been extremely quiet this week, and there is only a limited supply of bills available. Rates are unchanged. Quotations of the American Acceptance Council for bills up to and including 90 days are N% bid and M% asked; for four months, 34% bid and 5% asked; for five and six months, 1% bid and 'TA% asked. The bill buying rate of the New York Reserve Bank is IA% for bills running from 1 to 90 days, and proportionately higher for longer maturities. The Federal Reserve banks' holdings of acceptances decreased during the week from $113,211,000 to $111,939,000. Their holdings of acceptances for foreign correspondnets, however, increased from ,006,000 to $4,477,000. Open market rates for acceptances are as follows: T Prime eligible bills SPOT DELIVERY. -180 Days- -150 Dogs--120 Days Asked. Bid. Asked. Bid. Asked. Bid. 1 1 Si Prime eligible bills -90Days- -69Days- -30Days Asked. Bid. Asked. Bid. Asked. Bid. Si FOR DELIVERY WITHIN THIRTY DAYS. Eligible member banks Eligible non-member banks 1% bid 1% bid HERE have been no changes this week in the rediscount rates of the Federal Reserve banks. The following is the schedule of rates now in effect for the various classes of paper at the different Reserve banks: T DISCOUNT RATES OF FEDERAL RESERVE BANKS. Federal Reserve Bank. BostonNew York Philadelphia Cleveland Richmond Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Frandsen Rate in Effect on Jan. 19. 254 2 25.4 244 354 334 234 3 334 834 814 24 Dale Established. Nov. 2 1933 Oct. 20 1933 Nov. 16 1933 Oct. 21 1933 Jan. 25 1932 Nov. 14 1931 Oct. 21 1933 June 8 1933 soot. 12 1930 Oct. 23 1931 Jan. 28 1932 Nov. 3 1933 Previous Rate. 3 214 3 3 4 3 3 334 4 3' 4 3 TERLING exchange is weaker than at any time since early in November. Of course the most significant news of importance relating to the foreign exchange market was the President's message to Congress on Monday, asking power to devalue the dollar, to nationalize the gold in the Federal Reserve banks, and to set up a fund of $2,000,000,000 to S fan. 20 1934 regulate the dollar in the foreign exchange market at between 50 and 60 cents. The President's message and all important news items and discussions relating thereto will be found in other columns. Sterling has also dropped off sharply in relation to gold or the French franc and the price of gold in London, which had been steadily advancing since Jan. 8, went as high as 132s. 10d. per fine ounce on Thursday. Since Jan. 8 the London open market gold price has increased 6s. 2d. an ounce. The range for sterling this week has been between $4.943/ and $5.161 / 4. for bankers' sight bills, compared with a range of between $5.07 and $5.123/ last week. The range for cable transfers has been between $4.9494 and $5.16%, compared with a range of between $5.073 / and $5.1234 a week ago. The following tables give the London check rate on Paris from day to day, the mean gold quotation for the United States dollar in Paris, the London open market gold price, and the price paid for gold by the United States (New York Federal Reserve Bank, beginning with Tuesday): MEAN LONDON CHECK RATE ON PARIS Saturday Jan. 13 82.687 Wednesday Jan. 17 .80.45 81.861 Monday Jan. 15 Thursday Jan. 18 79.69 80.75 Friday Jan. 19 Tuesday Jan. 16 79.75 MEAN GOLD QUOTATION U. S. DOLLAR IN PARIS 63.7 Wednesday Jan. 17 Saturday Jan. 13 62.0 62.6 Thursday Jan. 18 Monday Jan. 15 62.6 62.2 Friday Jan. 19 Tuesday Jan. 16 62.6 LONDON OPEN MARKET GOLD PRICE Wednesday Jan. 17 127s. 2d. Saturday Jan. 13 131s. 6d. Monday Jan. 15 128s. 6d. Thursday Jan. 18 132s. 10d. Jan. 19 Tuesday Jan. 16 131s. 9d. Friday 132s. 10d. PRICE PAID FOR GOLD BY THE UNITED STATES (RECONSTRUCTION FINANCE CORPORATION a) Saturday Jan. 13 Wednesday Jan. 17 34.06 34.45 Monday Jan. 15 Thursday Jan. 18 34.06 34.45 Jan. 19 Tuesday Jan. 16 Friday *34.45 34.45 • New York Federal Reserve Bank superseded the Reconstruction Finance Corporation beginning with Tuesday. On Friday of last week and on Saturday, sterling was firm, although trading was decidedly limited. It was announced late on Friday of last week that Fred I. Kent, in charge of the foreign exchange control regulations of the Federal Reserve Bank, had resigned. The market was inclined to expect some reaction to this event in the European markets, but none appeared. Traders in all centers seemed to be acting with the greatest caution and transactions were confined to routine business. However, the publication of the President's message to Congress on Monday caused an upward burst on the part of all foreign currencies as traders made frantic efforts to adjust their technical position to the new value of the dollar. On release of the message various news flashes from Washington indicating new developments in the monetary field came in such rapid succession as to make trading almost impossible. The upward rush of sterling and the Continental currencies came to an abrupt halt in the later afternoon, and it was revealed that sterling was weaker against gold or French francs than at any time in many weeks. It was also revealed on Monday that the United States had been a heavier purchaser of gold in the London open market for weeks past than was generally believed. A complete reversal of trends set in on Tuesday and has continued since. In Thursday's trading sterling declined below $5.00 4 for the first time since Nov. 8. to as low as $4.943 There was evidence that all nations were buying dollars. Market short interests everywhere were covering since Tuesday, and it became more clearly evident that American and foreign funds abroad were being put into American securities. Hence, Volume 138 Financial Chronicle foreign exchange traders in all markets found it necessary to revise their technical positions. It was announced on Tuesday last that the domestic price for American mined gold would be increased from $34.06 per fine ounce, which price had prevailed since Dec. 18, to $34.45, the new price to remain in effect for an indefinite period. This price, set by the Washington authorities, represented a gold valuation of 60 cents for the dollar. However, the market for dollars became so strong that the Paris price was nearer to 63 cents, and even higher. The movement of funds from London and the European centers which sent up the dollar is believed to be really only in its first stages. Foreign exchange traders seem to be generally of the opinion that the Washington authorities will have considerable difficulty in keeping the dollar at the upper limit of 60 cents demanded by President Roosevelt, even though the newly established Equalization Fund totals $2,000,000,000. The British Equalization Fund totals $1,750,000,000. If clear evidence is given that stabilization will be maintained and legalized, so as to give greater assurance for a reasonable period of time, it is believed that the flow of funds from foreign markets to this side will become heavy. It is estimated in some quarters that there are no less than $10,000,000,000 of funds now practically idle in European markets which would eagerly seek investment here. There is no way of knowing exactly, but various conservative estimates assert that there are not less than $4,000,000,000 of American funds included in the above amount now domiciled abroad. Foreign bankers seem convinced that this great flow of funds will take place in the immediate future and responsible banking authorities in London, Paris, Amsterdam, and Basle are shaping their course in the expectation of such an exodus. The action of the foreign exchange market this week indicates that even the upper limit set by President Roosevelt is unnaturally low. It is believed that upon any evidence of recovery here, the dollar will show a tendency to rise despite any heavy expenditures by the United States Treasury to keep it down. It is also thought that the Treasury operations with this end in view will tend to raise gold and gold currencies to abnormal levels. Rumors have been revived of a probable early agreement for the stabilization of sterling. It was reported from London during the week that there might be an early agreement between the United States and Great Britain to fix the pound at $4.8665 in new dollars. This would be the old dollar parity, but in terms of new dollars worth 60 cents in gold, the pound in gold would be fractionally in excess of $3.00. Fears of a currency war can safely be dismissed, as the interests of France, Great Britain, and the United States would be better served by some form of stabilization agreement in conformity with the 60 cent dollar. There are no official statements from London of any kind on the subject of stabilization, but it is hardly likely that the foreign exchange markets will be permitted to develop a disorderly character, however funds may be shifted. There is an evident tone of sympathy with the President's plans in public and private dispatches from abroad. F. C. Goodenough, Chairman of Barclay's Bank in London, pointed out in his address at the annual meeting of the shareholders on Thursday; "It may be assumed that with the devaluation of the dollar, prices and wages in the United States will 379 ultimately adjust themselves to a higher level, but this may prove a somewhat lengthy operation in the case of a country like America, whose overseas trade forms a relatively small proportion of the whole. It must be remembered that there is no automatic relationship between the value of gold and the value of commodities, and should the internal purchasing power of the dollar remain in excess of its exchange value for a long period there may be serious repercussions upon world prices and international trade." Mr. Goodenough also said: "I am convinced that a gradual world recovery will take place, but that it will be more by the encouragement of individual effort and enterprise under some form of gold standard based on proved principles than as the result of artificial measures of restriction and control." Despite the present relative weakness of sterling in terms of gold, there is no marked flight of funds from London. London continues to be regarded as the safest money center in the world. As noted above, it was revealed during the week that the greater part of the open market gold "taken for an unknown destination" seems to have been for American account. On Thursday the weekly bulletin report of Samuel Montagu & Co., London bullion dealers, showed that during the week ended Jan. 15, £124,270 gold was exported from England to the United States. It is not known whether this gold was for the United States official account or not. Some reports in the market stated that the gold might be for private account motivated by the idea of discovering whether or not the United States Government would pay $34.45 per ounce or the statutory price of $20.76 per ounce for gold imported from abroad, Earlier reports from Paris current in the foreign exchange market had it that such a gold shipment to test this idea had been arranged in Paris, but the market was unable to confirm these reports. It may be that the gold now arriving here represents early purchases of the Reconstruction Finance Corporation. On Thursday Secretary Morgenthau, in a statement to the press, indicated that gold shipped from abroad from private agencies would be confiscated and paid for at the statutory price of $20.67 an ounce. The weekly statement of the New York Federal Reserve Bank issued on Thursday reveals that the bank bought abroad $4,319,000 in gold on Tuesday and Wednesday. This is the first transaction under the new regulations transferring the buying of gold from the Reconstruction Finance Corporation to the Reserve Bank. The purchase is revealed in the new item in the statement "gold held abroad." Money continues in great abundance in London and rates have hardly changed from those prevalent during the past few weeks. Call money against bills is in demand there at 4 3 % to 1%, fractionally firmer. Bill rates are easy. Two months' bills are 15-16% to 1%. Three- and four-months' bills are 1%, and six-months' bills are 1 1-16%. On Saturday last £540,000 bar gold available in the open market was taken for an unknown destination at a premium of 11d. On Monday £875,000 was taken at a premium of 83/ 2d. On Tuesday £855,000 was likewise taken at a premium of is. On Wednesday 000,000 was similarly taken, but believed to be entirely for American account, at a premium of 10d. On Thursday £725,000, the bulk of which is believed to have been taken for American account, 380 Financial Chronicle On Friday £900,000 went at a premium of was taken at a premium of 10d. The Bank of England statement for the week ended Jan. 17 shows a loss in gold holdings of £10,109, the total standing at £191,686,153, which compares with £120,570,654 a year ago and with the minimum of £150,000,000 recommended by the Cunliffe Committee. The Bank's ratio of reserves to liabilities has now entirely recovered from the year-end pressure and stands at 50.06%. This compares with 27.27% a year ago. At the Port of New York the gold movement for the week ended Jan. 17, as reported by the Federal Reserve Bank of New York, consisted of exports of $1,261,000 to England. There were no gold imports and no change in gold earmarked for foreign account. In tabular form the gold movement at the Port of New York for the week ended Jan. 17, as reported by the Federal Reserve Bank of New York, was as follows: GOLD MOVEMENT AT NEW YORK,JAN.11—JAN. 17,INCLUSIVE. Exports. Imports. $1,261,000 to England. I None. Net Change in Gold Earmarked for Foreign Account. None. Exports of Gold Recovered from Natural Deposits. None. The above figures are for the week ended Wednesday evening. On Thursday and Friday there were no imports or exports of the metal or change in gold earmarked for foreign account. There have been no reports during the week of gold having been received at any of the Pacific ports. Canadian exchange continues to range between a slight discount and a slight premium. On Saturday last Montreal funds were at 1-16% premium in terms of United States dollars, on Monday at a premium of from N% to %, on Tuesday from a discount of N% to a premium of 1-16%, on Wednesday at 3 %,on Thursday, due to from par to a discount of 4 heavy offerings by Canadian interests of both sterling and Canadian dollars, Montreal funds broke to a discount of 1 3-16%. On Friday Montreal 3 %. funds were at a discount of 4 Referring to day-to-day rates, sterling exchange on Saturday last was steady in a dull half-day session. Bankers' sight was $5.08%@$5.093/2; cable trans/ 3. On Monday, sterling adfers, $5.09@$5.097 vanced sharply following the President's message on monetary matters. The range was $5.11%@$5.163 4@$5.16% for cable for bankers' sight and $5.113 transfers. On Tuesday the pound dropped sharply. Bankers' sight was $5.07/@$5.123/2; cable transfers, $5.08@$5.12%. On Wednesday sterling continued to display softness. The range was $5.02U@ $5.0834 for bankers' sight and $5.034@$5.08 for cable transfers. On Thursday sterling went under $5.00. The range was $4.943/2@$5.003/2 for bankers' 4@$5.007 4 for cable transfers. On sight and $4.943 Friday sterling recovered; the range was $5.01@ 4 $5.03% for bankers' sight and $5.013/s@$5.037 for cable transfers. Closing quotations on Friday were $5.02% for demand and $5.02% for cable 2; transfers. Commercial sight bills finished at $5.013/ 4; 4; 90-day bills at $5.013 60-day bills at $5.013 2, and documents for payment (60 days) at $5.013/ seven-day grain bills at $5.02%. Cotton and grain for payment closed at $5.01M. XCHANGE on the Cpntinental countries is decidedly firmer in terms both of dollars and sterling. The gold currencies are especially firm, of E Jan. 20 1934 course, as the gold units are forced up. Opinions are again being expressed in market centers that France, Holland and Switzerland may be forced to suspend gold, perhaps to devalue their currencies and enter into speedy stabilization agreements. No official statements are forthcoming at present either in affirmation or denial of these market conjectures. Paris reports that there has been no sign of British Exchange Equalization control operation in the market to halt the decline of sterling against gold. Paris looks upon the firmness of the dollar as quite natural in the face of current developments. There has been heavy covering by shorts in all Continental centers. Continentals with American debts continue to redeem their debts at large savings. And further, Paris dispatches assert, American and European capital is attracted to New York by the prospect of a sustained rise in American securities. The French bankers generally express satisfaction with the American monetary policy as being more clarified and regard the recent measures as a step toward stabilization. However, some important banking opinion in Paris is inclined to expect that there will not be any early moves toward stabilization of sterling and dollars. Those of this view hold that the British are opposed to such action until the full effect of the American monetary policy on American and world prices has been observed. Gold hoarding seems to be no longer a problem confronting the French authorities and recent additions to the gold stock of the Bank of France seem to have come altogether from French nationals, largely offsetting gold withdrawn from the Bank of France whether by American or other gold purchasers in Paris. The Bank of France statement for the week ended January 12 shows an increase in gold holdings of fr. 13,462,669, making an aggregate increase since December 28 of fr. 309,000,000. Total gold holdings now stand at fr. 77,254,004,794. This compares with fr. 82,404,571,779 a year ago and with fr. 28,935,000,000 when the franc was stabilized in June 1928. The bank's ratio stands at the high figure of 79.24%, compared with 78.92% on January 5, with 78.01% a year ago, and with legal requirement of 35%. German marks are firm, but transactions in mark exchange are decidedly limited owing to the Reichsbank's exchange control. Items relating to the German credit situation will be found in our news columns. The "Wall Street Journal" in reviewing the German credit situation recently said: "Feeling against German debt policy in the United States has run high with the wide publicity given repatriation of German dollar bonds by German debtors. This movement has received renewed impetus from the offers of conversion into reichsmark securities on favorable terms made by a number of German companies. The sources of such buying, however, have been generally misunderstood, according to foreign bond experts. Whereas formerly dollar balances were utilized extensively, the bulk of the recent buying has represented switching from German holdings of American securities, as well as from other German dollar issues. The volume of dollar exchange available for purchase of German dollar bonds, other than that afforded by security switches, is declared to be negligible." The London check rate on Paris closed on Friday at 80.15, against 83.03 on Friday of last week. In New York sight bills on the French center finished on Friday at 6.2734, against 6.123/i on Friday of Volume 138 Financial Chronicle last week; cable transfers at 6.273/2, against 6.133/2, and commercial sight bills at 6.27, against 6.123 %. Antwerp belgas finished at 22.27 for bankers' sight bills and at 22.28 for cable transfers, against 21.76 and 21.77. Final quotations for Berlin marks were 37.89 for bankers' sight bills and 37.90 for cable transfers, in comparison with 37.19 and 37.20. Italian lire closed at 8.383/ for bankers' sight bills and at 8.39 for cable transfers, against 8.19 and 8.193/ 2. Austrian schillings closed at 18.15, against 17.60; exchange on Czechoslovakia at 4.76, against 4.65; on Bucharest at 0.96, against 0.96; on Poland at 18.02, against 17.60, and on Finland at 2.24, against 2.303. Greek exchange closed at 0.893/ for bankers' sight bills and at 0.88 for cable transfers, against 0.88 and 0.883/2. XCHANGE on the countries neutral during the war is, as far as the gold currencies are concerned firm in terms of the dollar and of sterling, although there is a movement of funds away from Holland and Switzerland to this side. The quotations are largely nominal as commercial transactions are limited. The Scandinavian currencies are of course easier in sympathy with sterling, as Sweden,Denmark and Norway are important members of the "sterling group." Bankers in neutral centers are inclined to hesitate in taking a position in the foreign exchange market until the reactions of London and Paris to the American monetary plans become more clarified. Bankers' sight on Amsterdam finished on Friday at 64.35, against 62.87 on Friday of last week; cable transfers at 64.36, against 62.88, and commercial sight bills at 64.26, against 62.78. Swiss francs closed at 31.04 for checks and at 31.05 for cable transfers, against 30.29 and 30.30. Copenhagen checks finished at 22.44 and cable transfers at 22.45, against 22.72 and 22.73. Checks on Sweden closed at 25.94 and cable transfers at 25.95, against 26.25 and 26.26; while checks on Norway finished at 25.29 and cable transfers at 25.30, against 25.57 and 25.58. Spanish pesetas closed at 13.22 for bankers' sight bills and at 13.23 for cable transfers, against 12.893/2 and 12.90. E 381 softness, following the trend of the world silver market, which up to the present appears to have made no response to the international silver agreements. Buying or selling exchange on China is equivalent to a transaction in silver. Japanese yen show comparatively little response to the events set into movement by the President's message. However, the market is watching Tokio very closely and it has been intimated in high quarters there that Japan may take radical measures toward a further devaluation of the yen. Closing quotations for yen checks yesterday were 30.15, against 30.30 on Friday of last week. Hong Kong closed at 383/8@38 7-16, against 383@38 7-16; Shanghai at 34/@343/ 2, against 34%@34 9-16; Manila at 503, against 503's; Singapore ay 59, against 59%; Bombay at 38, against 383/ and Calcutta at 38, against 383/2. PURSUANT to the requirements of Section 522 of the Tariff Act of 1922, the Federal Reserve Bank is now certifying daily to the Secretary of the Treasury the buying rate for cable transfers in the different countries of the world. We give below a record for the week just passed: FOREIGN EXCHANGE RATES CERTIFIED BY FEDERAL RESERVE BANKS TO TREASURY UNDER TARIFF ACT OF 1922. JAN. 13 1934 TO JAN. 19 1934, INCLUSIVE. • Country and Monataxp Unit. Noon Buying Rate for Cable Transfers in New York. Value in Untied States Mow. Jan. 13. Jan. 15. Jan. 16. Jan. 17. Jan. 18. Jan. 19. EUROPE$ $ g $ $ $ Austria,schilling .177125 .180187 .183125 .182062 .180625 .181687 Belgium, belga 218084 .222033 .224027 .224016 .221725 .222081 Bulgaria. ley 013150* .013566 .013466 .013566* .013366* .013566 Czechoslovakia, kron 046639 .047434 .047856 .047850 .047487 .047337 Denmark, krone 227300 .228800 .227577 .226441 .221441 .224200 England. pound sterling 5.090416 5.123583 5.085750 5.069500 4.954507 5.014916 Finland, markka 022612 .022850 .022575 .022516 .022180 .022280 France,franc .061471 .062626 .063016 .063180 .082517 .062523 Germany, reichsmark .372600 .378254 .381210 .381950 .378285 .377966 Greece. drachma 1 .008866 .008995 .009133 .009066 .008960 .008995 Holland. guilder ' 629553 .640341 .644918 .646545 .639863 .640692 Hungary, pengo .277000 .280666 .286668* .284500,.282833* .284166* .082220 .083708 .084230 .084241 .083377 .083532 Italy. lira Norway, krone .255866 .257408 .256066 .254841 .248866 .252055 Poland, zloty 175875 .180500 .183625 .182500 .181100 .181875 Portugal, escudo 046584 .047220 .047062 .046625 .046240 .046360 Rumania.leu 009600 .009625 .009766 .009610 .009520 .009675 129476 .1318118 .132992 .133200 .131778 .131788 Spain, paseta Sweden. krona 262558 .264227 .262918 .261790 .255244 .258760 Switzerland. franc__ .303445 .308491 .310623 .311569 .308407 .308181 Yugoslavia, dinar__ .021650 .021920 .022160 .022020 .022140 .022075 A SIAChinaChefoo (yuan) dol'r .341666 .345833 .346666 .345833 .338416 .341666 Hankow(yuan) dol'r .341666 .345833 .346666 .345833 .338416 .341666 Shangbal(yuan)dar .342500 .346562 .346406 .345468 .338781 .340937 Tientsin(yuan) dol'r .341666 .345833 .346666 .345833 .338416 .341666 .379062 .384687 .386250 .380416 .375625 .377916 Hongkong dollar 383090 .385290 .383250 .381900 .372875 .376250 India, rupee .302600 .303856 .302625 .302150 .295687 .297812 Japan, yen Singapore (8.8.) dol'r. .592500 .597500 .595625 .591875 .578500 .585625 AUSTRALASIAAustralia. pound 14.051666 4.083333 4.048333 4.038333 3.939791 3.991666 New Zealand. pound_ 4.062500 4.094166 4.059166 4.048750 3.951666 4.000833 AFRICASouth Attica. pound__ 5.031875 5.067812 5.027500 5.012812 4.899375 4.957812 NORTH AMER.999687 1.000677 1.000208 .997083 .987500 .990520 Canada. dollar 999800 .999550 .999550 .999550 .999150 .999150 Cuba. peso Mexico. peso (silver). .277160 .277360 .277360 .277360 .277320 .277360 Newfoundland, dollar .997250 .998125 .998125 .994375 .985125 .988250 SOUTH AMER.334866 .341125 .345375 .344366* .341800, .333875, Argentina. peso Brazil, milreis 085675 .086233 .086393 .086112* .085150* .086462, Chile. peso .094250 .094500 .096750 .095500* .095900 .094500, Uruguay. peso 749666 .761666 .774166 .770333* .768633 .765333, Colombia. peso 657900* .662300 .664500 .664500* .666700 .671200, •Nominal rates;firm rates not available XCHANGE on the South American countries has up to the present displayed no manifest reaction to the current events affecting the major foreign units. These currencies continue to be only nominally quoted as these units are under the control of Government boards. The official rate for Argentine paper pesos shows little change from day to day: In New York an "unofficial" or "open market" rate, lower than the Buenos Aires official rate, fluctuates rather widely and showed a range this week of between 25.50 and 27.35. HE following table indicates the amount of gold Argentine paper pesos closed on Friday nominally bullion in the principal' European banks as of at 333j for bankers' sight bills, against 333 on Jan. 18 1934, together with comparisons as of the Friday of last week; cable transfers at 333, against corresponding dates in the previous four years: 3332. Brazilian milreis are nominally quoted 83/ 1933. 1932. for bankers' sight bills and at 83 1931. 4 for cable transfers, Banks of- 1934. 1930. £ £ i £ against 83/i and 83 E 4. Chilean exchange is nominally England_ 191,686,153 120,570,654 121,321,171 142.861,766 151,288,975 618,032,038 659,236,574 568,774,581 435,301.676 341.895,396 quoted 93 4. Peru is nominal at 23.55, France-a__ 4, against 93 Germany-b 17,022,000 37,877,500 42,716,250 99,529.000 106,699,450 Spain 90,458,000 90,345,000 89,911,000 97,297,000 102,641.000 against 23.00. Italy 76,828,000 63.053,000 60,854,000 57.297,000 56,120.000 E T XCHANGE on the Far Eastern countries presents no new features of importance. The Indian rupee fluctuates, of course, with the pound, to which it is attached at the fixed ratio of is. 6d. per rupee. The Chinese units show a tendency toward E Netherrds_ Nat.Belg'm Switzerland Sweden _ _ _ Denmark Norway_ _ _ 76,789,000 78,480,000 67,518,000 14,430,000 7,398,000 6,573,000 86,050,000 74.263.000 88,963,000 11.443,000 7,397,000 8,015,000 73,294.000 72,853,000 61,042,000 11,435,000 8,015,000 6,559,000 35,510,000 39,222,000 25,757,000 13,377,000 9,558,000 8,134,000 37,288.000 32,750,000 23.221,000 13,582.000 9,578,000 8,146.000 Total week- 1,245,214,191 1.247.213.728 1,106,775,002 964,147,342 883,209,821 Prey. week- 1.244.565,499 1.250.299.287 1.102,828,061 963,213,505 880,931,849 a These are the gold ho dings of the Bank of France as reported in the new form ot statement. b Gold holdings of the Bank of Germany are exclusive of gold held abroad, the amount of which the present year is £2,150.960. 382 Financial Chronicle German Policy and the European Situation. However suspicious or hostile the other European Powers may be regarding the plans of the Hitler Government, the policy of Germany, foreign or domestic, continues to be a leading, and it must also be said a disturbing, factor in Continental affairs. The question of the plebiscite which is to determine the future status of the Saar has been brought sharply before the League, and in that controversy the position of Germany is of the first importance. Advances continue to be made by France for some settlement of the armament problem, and while the proposals which have emanated from France appear at the moment to be somewhat contradictory, they nevertheless seem to evince some desire to find a basis of agreement. The approaching inauguration of a new labor program, on the other hand, with the obliteration of the old trade unions as one of its principal features, while primarily of concern to Germany, is bound to arrest the attention of organized labor in other countries and affect the discussion of international questions. At each of these three points the attitude of the Hitler Government is worth examining. Although the plebiscite in the Saar is not due until 1935, it has been realized for some months that the question would have to be taken up at an early date by the League, partly to insure arrangements fair and satisfactory to the people of the region, and more particularly because of reports of Nazi activities intended to insure the recovery of the Saar by Germany. The Treaty of Versailles, it will be recalled, gave to France a property right in the coal mines of the Saar as compensation for the losses which French mines had suffered during the war, but the government of the region was entrusted to a League Commission which was to administer the country for fifteen years. At the expiration of the fifteen years the people of the Saar were to decide by vote whether they would remain an autonomous State under the oversight of the League, or unite with either France or Germany. The title of France to the coal mines was not to be affected by the plebiscite, but if a union with Germany were voted the Reich was to have the opportunity to buy back the mines on terms acceptable to the League. The Saar population is overwhelmingly German, and all the historical associations of the region are with the Reich. It has been a matter of common knowledge that France, whose influence predominated in the Commission, was exerting itself to make the Saar as French as possible, and on several occasions the intrigues, or alleged intrigues, to that end have been ventilated in the French, English and German press. Until the advent of the Hitler Government, however, there was a general opinion, at least outside of France, that the efforts to win the Saar to France had failed and that the plebiscite would show a heavy majority in favor of reunion with Germany. The extreme policies of the Hitler Government, on the other hand, appear to have worked some change in popular feeling, and reports of Nazi activities, accompanied in some cases with lawlessness and violence, have created a political situation with which the Commission has found it hard to deal. The disturbing factor at the moment is the fact that Germany, whose interest in the plebiscite is obviously very great, has withdrawn from the League and announced that it will not under any circum- fan. 20 1934 stances return. It is this problem that the League Council, which has met this week at Geneva, finds itself compelled to face. A surprise move was made on Monday when the French delegate(we quote from a Geneva dispatch to the New York "Times") told the Council that "France's sense of fair play made her desirous that Germany's attention be specially called to the Saar item, and that discussion of it be postponed long enough for Germany to participate if she desired." The French move, it was said, was "intended to serve not merely as a conciliatory gesture but to prevent Germany from complaining later that the plebiscite had been arranged behind her back." The Council acceded to the proposal to' the extent of informing Berlin by telegraph. The reply of the German Government has not been made public, but it was reported on Tuesday to be a relusal, although the refusal was couched in friendly terms and declared to be "for reasons of principle." Meantime the Saar Commission has been reappointed. As the Commission has been severely criticized by the Nazis 'for forbidding Nazi demonstrations, its reappointment does not indicate any yielding to Germany. The Saar suggestion came in the midst of a confusing series of events affecting Franco-German commercial and political relations. On January 8 a semi-official announcement at Berlin indicated a conciliatory attitude on the part of the Hitler Government toward the recent French request for detailed information regarding German armament, and it was shortly reported that the meeting of the Disarmament Conference, scheduled for January 22, might be postponed in hope of a rapprochement. On January 13, however, before any formal reply from Germany had been received, the imposition of a quota system upon French imports was reported to be imminent at Berlin, and the next day the quotas were announced. The regulation, according to the Berlin correspondent of the New York "Times," was expected to reduce French exports to Germany to about one-half what they were in the first quarter of 1933, and was designed to meet French quotas which would cut German exports to France by 600,000,000 francs annually. An ultimatum refusing to accept the new quotas and demanding an answer by Thursday was handed to the German Government on Monday, but on Tuesday, with the dispute pending, the French Foreign Minister, M. Paul-Boncour, gave the Senate to understand that France was willing to accept the German offer, made several weeks ago, of a ten-year mutual non-aggression pact, although the offer was apparently conditioned upon acceptance by Germany of some form of international supervision of armaments. What seems like playing at cross-purposes is perhaps to be explained, in part, by reference to the political crisis through which France has just been passing. The charges and counter-charges which followed the recent failure of a large pawnbroking establishment at Bayonne, together with the riotous collisions between bands of royalist youths and the police which shortly broke out in Paris, were interpreted by the Chautemps Government as proof of a widespread and carefully nursed Fascist movement in France, which, combined with the royalist agitation which has long been openly carried on, jeopardized the safety of the State as well as the stability of the Government. For two or three days the Volume 138 Financial Chrcnicle Ministry was in peril, and although Premier Chautemps, after a protracted and violent debate, obtained from the Chamber of Deputies on January 12 a substantial vote of confidence for a proposed investigation of the Bayonne affair by the Government instead of a parliamentary commission, the incident left the Ministry weaker than before. Under these circumstances, and with evidences of increasing Fascist strength in Italy, Germany and Austria, it may well have seemed wise to the Government to take a conciliatory attitude toward Germany in the matters of armament and the Saar, notwithstanding that policy required a bold front in regard to trade -quotas. The text of the new German labor law which was published on Tuesday has not yet been. made available in this country, but enough can be gathered from press summaries to show that it is, in important respects, revolutionary. According to the Berlin correspondent of the New York "Times," the law does away entirely with labor unions and "all those rights and privileges on which the organized labor movement rests." Labor in Germany can no longer organize, or make collective wage bargains, or declare strikes. The relations of employers and employees are to be governed by two principles, one defined as "social honor" and the other as "leadership in business." The law sets up a system of "shop councils" composed, apparently, of the employer, elected representatives of the older and "nationally reliable" employees, and a Government "labor trustee." The employer, who is to be chairman of the council in his establishment, is to determine how his business is to be conducted and fix wages and working conditions, while the trustees, of whom there are to be thirteen for the country, are to adjust differences and exercise a general supervision of industry. Both employers and employees are made responsible to "social honor courts," which may try employers who "maliciously exploit" their employees or "insult their honor," and also proceed against employees who "through malicious agitation endanger labor peace within the shop, deliberately interfere with the management or make frivolous complaints to the labor trustee." Employees are protected by the law against mass dismissals or shutdowns without due notice, and may individually sue for reinstatement or pay if the business code has been violated. Remembering the extraordinary success of the propaganda arm of the Hitler Government, one is inclined to take with some reserve the apparent spontaneity and genuineness of the tremendous popular demonstrations, at Berlin and elsewhere, which • greeted in advance the promulgation of the new law. Organized labor in Germany, while different in )i rit as well as in methods from organized labor in this country or Great Britain, has struggled long and hard for its special privileges, and may well viei' with deep chagrin, if not open resentment, the loss of what it had won. Superficially, the new system bears some resemblance to the "corporative" State which Premier Mussolini has planned, and which on Jan. 13 was approved by an overwhelming majority of the Italian Senate and on Thursday was accepted by the Chamber of Deputies. At one or two points a resemblance can be detected to the code system of President Roosevelt and the National Recovery Administration. As far as can be gathered from the available outline of the plan, however, it appears to 383 be essentially unique. The destruction of the trade union organizations follows a taking over by the Government of control of business and industrial associations, and under the direct supervision of Government officials the two parties are to be forced to co-operate in accordance with Government standards. Business management recovers some of the independence which trade unionism had taken from it, but its freedom is evidently closely circumscribed, while labor, in turn, loses the strongest weapons with which it had enforced its demands. The new system, in other words, seems an attempt te preserve the form of employer initiative and labor rights, but to cover it with the hard fact of supreme Government control. German diplomacy has often been criticized as maladroit, and in domestic matters the hand of authority has more often than not been heavy. There seems reason for suspecting, however, that Chancellor Hitler has chosen the moment when his authority at home is at its height to mix boldness and shrewdness in his foregn policy. Against the risk which he took in withdrawing Germany from the League, he has apparently counted upon the political agitation of France, the ambition of Italy for leadership, and the reluctance of Great Britain to undertake further commitments on the Continent as giving an opportunity to press for a favorable solution of the Saar problem and to hold out for armament concessions from France and the League. The policy is not without danger,for the Continental situation can change quickly, but as long as disunity prevails among the other leading Powers the situation invites him to test his resources. For the moment he holds a prominent position on a stage where none of the principal actors is playing a leading part. Looking After the Consumer. The American Academy of Political and Social Science, founded in Philadelphia in 1889, could scarcely have chosen for discussion at its annual conference held last week a theme of more intense current interest than the one selected for general discussion near its closing session, namely "Progress towards National Recovery." Not in recent years has there been so large an attendance of members or of the general public as participated in the sessions covering two days, held in the spacious ballroom of the Hotel Bellevue-Stratford in the Quaker City. The speakers included a battery of able and talented men from Washington, each of whom is identified with some branch of the recovery movement, and a number of level headed business men such as Mr. Filene of Boston and Mr. Tily, of Philadelphia, leading merchants. Affairs moved along quite smoothly in favor of the unusual and extreme methods which have been promulgated at the Capital until the meeting on Saturday afternoon, when a representative of the "forgotten man," the consumer, appeared upon the stage. This spokesman was Frederick J. Schlink, President and Technical Director of Consumer Research, Inc., Washington, N. J. Mr. Schlink asserted that in some circles it was declared a mistake had been made by creating the Consumers' Advisory Board, indicating that upholders of the Recovery Act and all the machinery which has been created under its authority did not wish to have any "monkey wrench" lying around loose. 384 Financial Chronicle Every living soul in the Republic is a consumer, his imperative need for food, shelter and raiment constituting a fundamental foundation upon which big business of every sort is chiefly dependent. Advanced civilization, invention, science and industry have multiplied and magnified man's wants far beyond the conception of aborigines. First came the invention, followed by education of men to its uses and advantages until that which was at first regarded as a luxury became a great necessity. Upon this development world progress has rested and the consumer is really the sustaining force upon whom the burden of maintenance finally rests. The whole scheme of the National Recovery Administration is like an endless chain, the first link being the producer of raw materials from the surface the bowels of the earth and from the atmosphere whence electricity is generated. Next in order come transportation, manufacture and distribution. These latter are the material things to which NRA has given definite attention, not overlooking labor, which enters into the process of all production until the fruit of effort is laid at the door of the consumer. Since there is a great variety of consumers among whom are those abundantly able to take care of themselves under all circumstances it must be that the efforts of the NRA in this direction,lean towards those who are less able to protect themselves and it is upon this portion of every community that NRA methods may become oppressive unless steps are taken to safeguard the small consumer. Large appropriations of public funds have been made to provide the proper connecting link between production and consumption, but practical execution of the plans depends upon sentiment and efficiency in each local community, be it great or small. Much attention has been given at Washington and throughout the country to the top of the new structure, but vigilant efforts must be made at once to cultivate the roots lest the top wither and decay. Lincoln once remarked that "The Lord must love the common people, else he wouldn't have made so many of them." The common people who constitute the great mass of consumers are now the ones to Jan. 20 1934 which each community should give special attention in order that work, wages and consumption may again approach the normal. Mr. Schlink in advocating the interest of one stratum is really working in behalf of all the overlying layers. Laird Bell and John Foster Dulles Sail for Germany to Attend Long Term German Debt Conference in Berlin, Jan. 22. Laird Bell of Chicago, and John Foster Dulles of New York, issued the following statement on Jan. 13 upon theirdeparture to attend the Long Term German Debt Conference in Berlin, called by the Reichsbank for Jan. 22. Mr. Bell is Vice-President of the newly formed Foreign Bondholders Protective Council, and Mr. Dulles is attending the Conference at the request of the American houses which issued German bonds: The German Debt Conference has been called for the specific purpose or considering the requests of the Swiss and Dutch Governments for special arrangements with Germany whereby in exchange for granting additional trade facilities their holders of German bonds will be paid in full. Similararrangements had been made last summer by the Swiss and Dutch Governments, and at the December Debt Conference the American position was strongly opposed to these agreements. An official assurance was at that time given by the German Government that these arrangements would not be renewed or any new arrangements of like character made, without submitting such proposed arrangements to the international creditor group which had been meeting with the Reichsbank. Preferential arrangements of this type are definitely prejudicial to the interests of the American bondholders. Since, of all the creditor countries, the United States is the only country which has a favorable balance of trade with Germany, the maintenance of interest payments, as well as of our exports to Germany (consisting primarily of cotton and other raw materials), depends upon Germany creating balances in her favor in other countries, which balances can be transferred into dollars. The allocation of these favorable trade balances to the creditors in those countries which create these favorable trade balances for Germany, cannot but be to the disadvantage of American bondholders. The German call for the Conference limited the topic of discussion to the foregoing. However, It is probable that the representatives of the creditor countries will again bring up the matter of the Reichsbank decision to reduce interest payments for the current six months from an effective 75% to an effective 65% basis. F. Abbot Goodhue of Bank of Manhattan Company Sails To-day for London to Attend Meeting of Representatives of Standstill Creditors Committee for Germany. F. Abbot Goodhue, President of the Bank of the Manhattan Co. sails to-day (Jan. 20) on the S. S. Bremen for London to attend the preliminary meeting of the representatives of the Standstill Creditors' Committee. From there he will go to the meeting of the Creditors' Committee in Berlin, to be held Feb. 5. Mr. Goodhue is Chairman of the Committee of American Bankers representing American Standstill Creditors. The forthcoming meeting of Germany's short term foreign creditors was noted in our issue of Dec. 30, page 4608. Bank Clearings in 1933 and the Course of Trade and Speculation We need hardly say that the year 1933 was one of important events, unquestionably more so than any similar period during peace times in the whole history of the country. In the economic and industrial world the first three months were marked by growing depression and a general breakdown which reached its acute stage in a suspension of all the banks in the United States immediately upon the succession of President Roosevelt to control of the Government on the 4th of March. Up to that time things were steadily going from bad to worse, while Mr. Hoover was heroically battling against the inevitable which came with the banking collapse referred to. Beginning with the reopening of the banks under Mr. Roosevelt's masterful handling of the situation, things began rapidly to improve as Mr. Roosevelt made it appear that his policy would be to restore the basis of commodity values prevailing back in, say, 1926, and with that object in view would undertake to force down and depreciate the gold value of the American dollar. This meant to the extent that the policy was successful, higher prices all around,and the general public, imbued with that idea began to buy commodities and everything else with the greatest confidence on the idea that no loss could be incurred in any event, and that profits were certain as prices kept rising in accordance with the policy and program thus laid down. The buying was not with the notion that the needs for consumption would be large enough and broad enough to make a ready market for a sustained and dependable demand for goods, but with the notion that commodity prices 'would be sustained at higher levels no matter what might happen. The unshakeable conviction that this must be so led to avid buying of goods and this buying in turn led producers and manufacturers to turn out greatly increased volumes of goods, while the latter in turn served to reduce the number of the idle and unemployed and to that extent did furnish a genuine basis for an enlarged consumption of goods. Accordingly for the time being business activity grew apace and National recovery appeared at last to be getting in full swing. Speculation helped the movement along and in fact in the end led to bringing it to a halt. Grain prices enjoyed startling advances,cotton Volume 138 Financial Chronicle and nearly everything else moved higher, and in July the speculative frenzy came to an end. On Thursday, July 20, and Friday, July 21, the skyrocketing on the Stock Exchange reached its climax and the boom collapsed. The collapse was as complete in the commodity markets as on the Stock Exchange. As one illustration the September option •for wheat in Chicago after a prodigious previous advance jumped from 953.4.c. July 1 to $1.203/ July 17, but in the great break on July 19 and July 20 tumbled to 90c. The Chicago Board of Trade then -decided to abandon trading on Friday, July 21, and Saturday, July 22, and to limit daily fluctuations thereafter. Some recovery then ensued which carried the price back to $1.07Y1 July 27 but a new setback was then encountered and on Monday, July 31, another very bad break was experienced— this time, too, at a time when the spring wheat crop was suffering further disaster from extreme heat and drouth—and the price once more got down to 92c. The previous spring,September wheat in Chicago had sold as low as 4534.c. In the case of cotton the spot price on the New York Cotton Exchange on July 18 was marked up to 11.75c., but closed on July 31 at 10.00c. In other words, compared with 11.75c. on July 18 the price July 31 of 10.00c., involved a break of $8.75 per bale of 500 lbs. The previous February the spot price of cotton on the New York Cotton Exchange was less than 6c. a lb. Business activity now met with a severe setback, which continued until towards the very close of the year and extended to virtually all lines of trade until some slight traces of renewed activity again came into evidence. Bank clearings naturally reflected these ups and downs, though they were not perhaps so completely parallel to the same as on most previous occasions. It should be said, however, that there were other obstructive developments which held in check the activity in trade during the summer months. And these found their basis chiefly in the monetary policy of the Government which created a feeling of apprehension in financial circles, also the uncertainties connected with the operation of the National Recovery Act and the Code of Fair Dealing, and in the oppressive measure of the new Securities Act. The year's legislation after the accession of Mr. Roosevelt to control of the Government was of the most extensive and far-reaching character, and came with a rapidity which probably has had no parallel in the country's history. And the same remark is to be made concerning the urgency with which it was rushed through. Some of this legislation was of a highly constructive nature and was demanded by the extraordinary state of the times. Not a little of the legislation, however, was of an extremely radical type, in fact bordering on the revolutionary, and had as its sole basis the new economic and social theories which Mr. Roosevelt was undertaking to impose upon the country. Depreciating the value of the gold dollar was the main instrumentality for attaining his objective, and for inaugurating his plans for a New Deal in the economic and social world. All of this legislation was enacted on the initiative of the President himself, and though it was read with much disfavor in financial circles and gave rise to serious anxiety and misgivings as to the ultimate outcome, did not have such a deterent effect on business progress as might have been supposed, and did not really act to check business recovery until after the collapse in July when it 385 appeared that much of the trade revival, and certainly the speed with which it had moved forward, was based on speculation and rested on hollow and unsubstantial grounds—then the new legislation, or at least the steps taken under it, received closer attention and a disposition developed to proceed with caution and go slow until a better basis developed for estimating just how it was going to work out and how far it was to be carried. The first piece of legislation of course was the enactment of the Emergency Banking Act which was an absolute necessity and in the passage of which not a moment's loss of time was permitted. This conferred extraordinary powers upon the President, and as illustrative of this it may be noted here that in the course of a debate on the measure which made the President in effect the sole banking authority, Carter Glass was prompted to say, while giving unqualified approval to the proposition: "It broadens, in a degree that is almost shocking to me, the currency and credit facilities of the Federal Reserve System." Nevertheless there was not the least hesitation on the part of Congress in conferring these extraordinary powers upon the President, since Republicans and Democrats alike felt that the crisis was of such a nature that there was really no alternative but to give the President every vestige of the authority sought by him, since he, and he alone, was qualified under existing circumstances to deal with the situation. This accounted for the speed with which the measure was rushed to completion. The Washington. Bureau of the New York "Herald Tribune," in commenting upon this point said that the House of Representatives debated the bill only 35 minutes and passed it "not a copy of which was in the hands of a single member," and remarked that the measure was considered in that House by a unanimous consent agreement and approved by acclamation. After the passage of the Emergency Banking Act rapid progress was made with the plans designed to insure a return to normal banking and economic conditions. Mr. Roosevelt sent message after message to Congress recommending legislation to that end, and Congress responded by accepting his proposals in quick order. Among the earliest of the measures enacted by that body was the Economy Act by which the President expected to save from $500,000,000 to $1,000,000,000 a year through radical cuts in the compensation of veterans and by reducing the pay of Federal employees; also the beer bill by which the manufacture and sale of beer of a low alcoholic content was authorized. April saw the United States pass off the gold standard, to which it had consistently and persistently adhered for a period of over 54 years, or since the resumption of specie payments on Jan. 1 1879, and it saw this done, not because of a shortage of gold supplies within the country, but as a deliberate matter of policy. It saw the action viewed, too, not as occasion for deepest regret, but treated as an event for rejoicing, with the great mass of the population according it approval, and with the stock and commodity exchanges manifesting unrestrained buoyancy, accompanied by spectacular advances in prices that had their only parallel in the wild speculation of 1928 and 1929 and with a volume of trading which likewise had its only parallel during the same frenzied period of speculation. It was on April 19 that public admission came that the Government 386 Financial Chronicle meant to let the international value of the dollar shift for itself and that the purpose thence forward would be to make sure that the value of the dollar should become so depreciated as to bring about a commensurate rise in the general level of prices in this country. Thereupon the drop in foreign gold values assumed notable dimensions. To cap the climax, and to emphasize the fact that the Administration meant no longer to pay any attention to the foreign value of the dollar, legislation was determined upon of a most startling character designed to bring about credit and currency inflation with a view to raising the general level of prices in this country, this to be accomplished by depreciating the gold value of the dollar. In addition to the action of the President.in suspending the gold standard, virtually all the major legislation of importance found enactment in May and June. The Farm Relief Act, with the Thomas inflation provision imposed on it as a rider, this last perhaps the most important measure of the entire session because of this rider, was approved May 12. The Wagner Unemployment Relief Act also passed onto the statute book on May 12. The Federal Securities Act became a law on May 27. The Act for Government operation of Muscle Shoals and creation of the Tennessee Valley Authority became a law with the President's approval on May 18. The resolution repealing the gold clause in Federal and private contracts was enacted into law on June 5. The Wagner bill establishing a National Employment System under the Department of Labor was signed by the President on June 6. The Glass-Steagall bill, known as the Banking Act of 1933, and containing the provision for Federal Deposit Insurance, became a law with the President's signature on June 16. The National Industrial Recovery Act providing for Federal control and revival of industry and a public works program of $3,300,000,000 received Mr. Roosevelt's signature on June 16. The Emergency Railroad Transportation Act also received Presidential approval on June 16, as did the Farm Credit Act of 1933 providing for establishment of 12 pro: duction credit corporations. The Home Owners' Loan Act of 1933 became a law on June 13. The Act authorizing the Reconstruction Finance Corporation to subscribe for preferred stock and purchase the capital notes of insurance companies received approval June 10. The Reconstruction Finance Corporation, which was established by the Hoover Administration and which went on the statute book Jan. 22 1932, was authorized by the Emergency Banking Act, signed by President Roosevelt on March 9 1933, to acquire the preferred stock and capital notes of banks. We are rehearsing the placing of a few of these various measures on the statute book because they show how step by step the Government assumed larger and still larger control of the economic, financial and industrial 'activities of the country along wholly new lines as part of the policy for carrying out the New Deal. And it deserves to be noted that it was not until after Congress adjourned, on June 16, and after the speculative collapse in July, showing how insecure was the foundation on which business revival had been proceeding, that business recovery itself began to halt and falter and the sober sense of the community began to reassert itself, and a general determination grew up to await the outcome of the elaborate scheme of new legislation under which the business community was now Ian. 20 1934 obliged to seek its destiny. The Federal Securities Act certainly proved a decidedly depressing piece of legislation. With the adjournment of Congress on June 16 the period of experimentation in its larger sense began and this involved so many things of a drastic and radical character that it involved the future in considerable uncertainty and made business men proceed with unusual caution. And this spirit became more pronounced after the speculative collapse in July indicating that speculation had taken possession not alone of the securities market, but the commodity markets as well, as already indicated in our remarks further above. Reaction from the pace at which business recovery had been proceeding was the natural outcome. The experimentation related to agriculture and to industrial and economic affairs with the intention to insure business recovery, these efforts are being conducted mainly in the establishment of codes for fair dealing in the various industries under the provisions of the National Industrial Recovery Act. On June 16 Secretary of Agriculture Wallace announced the program for processing taxes and acreage reduction, as applied to wheat, under the Agricultural Adjustment Act. Mr. Wallace indicated that no general curtailment was proposed for the 1933 crop, but that the percentage of acreage reduction in 1934 and 1935 which might be asked while still undetermined (pending the outcome of the London wheat conference) was in no case to exceed 20%. The tax was fixed at 30c. a bushel, effective July 9, which was equivilant to $1.38 per barrel. It happened, too, that the World Monetary and Economic Conference at London convened on June 12 and adjourned in July without having accomplished anything towards monetary stabilization, which was its main object. President Roosevelt himself settled the question of stabilization with distinct emphasis, so far as the Conference was concerned, by a message sent and published July 3. Another development of the month was the promulgation by the Washington Administration of a blanket or omnibus code for bringing the entire private business activity of the United States under the regulation and control of the 'Federal Government. The combined effect of the speculative collapse, the failure of the Monetary and Economic Conference, and the promulgation of the omnibus code was unquestionably to produce a quieting effect in leading the industrial community to reflect upon what was happening and whither the country was drifting, the query naturally arising whether, after all, the scheme of a planned recovery in trade could be counted upon to lead to sustained trade revival as intended. • In August the activities of the NRA attracted attention beyond everything else in the business world and codes were adopted for such leading industries (either temporary or final) as the iron and steel trade, the lumber trade and the oil trade, in addition to that for the cotton textile industry adopted the previous month. Three destinctive developments of the month attracted particular attention, namely (1) the issuance of an order by President Roosevelt on Aug. 29 permitting gold miners in this country to dispose of newly mined gold abroad at a price equal to the best price obtainable in the free gold markets of the world, (2) the action of an international conference in London in entering into a world-wide agreement for the restriction of the production of wheat and in allotting both exports and Volume 138 Financial Chronicle imports within certain, limits and (3) the action of the Federal Reserve banks in increasing their purchases of U. S. securities from $10,000,000 a week to $35,000,000 this last being a step in the Washington program of inflation. During September the outstanding feature was the lessening of trade activity in several different lines and the efforts of the Administration at Washington to offset and counteract this slowing down of business by means of Government agencies. Among the devices arranged for this purpose one stood out preniinantly, that is the setting afloat of plans for direct loans from the Reconstruction Finance Corporation to banks and banking institutions, where these would agree to reloan the money to those desirous of enlarging the volume of their business. By such proceedings the Reconstruction Finance Corporation was placed in direct competition with the Federal Reserve banks in extending credit accomodations to needy borrowers or at any rate could engage in supplementing the loan facilities of the Reserve banks; and furthermore the Reconstruction Finance Corporation, it was made plain, in placing loans of this character would not look askance at the slow character of the assets that might be offered as security. In October (on Sunday night Oct. 22) President Roosevelt in a radio speech startled the country by announcing that he planned continuous control of the dollar by having the Reconstruction Finance Corporation buy and sell gold in the markets of the world. In his remarks the President said on that point: "Our dollar is now altogether too greatly influenced by the accidents of international trade, by the internal policies of other nations, and by political disturbance on other continents. Therefore the United States must take firmly in its own hands the control of the gold value of our dollar. This is necessary in order to prevent dollar disturbances from swinging us away from our ultimate goal, namely the continued recovery of our commodity prices. As a further effective means to this end, I am going to establish a Government market for gold in the United States. Therefore, under the clearly defined authority of existing law, I am authorizing the Reconstruction Finance Corporation to buy gold newly mined in the United States at prices to be determined from time to time after consultation with the Secretary of the Treasury arid the President. Whenever necessary to the end in view, we shall also buy or sell gold in the world market." In the carrying out of the gold policy, extremely violent fluctuations in foreign exchange rates now occurred, which it was felt not only retarded recovery in business, but threatened, it was feared, to bring on depression anew. All the foreign exchanges turned strongly against this country, and on Nov. 16 sterling bills on London sold as high as $5.523 4 and the dollar in terms of gold dropped to below 60c., the quotation on the basis of the French franc being only 58.50c. In December further unfolding of the President's monetary policy came in the issuance of a proclamation providing for the absorbtion by the Federal Government of virtually the entire annual silver production of the United States and its coinage into dollars at the rate of 50% of the silver thus taken over by the Government. This latter action came as a complete surprise on the evening of Dec. 21, no one having had any previous intermation that anything of the kind was contemplated. Spectacular 387 results followed for the time being on both the Stock Exchange and in the commodity markets, where it was hailed as another inflationary move._ The effect now, however, was hardly more than temporary, the markets quickly lapsing back into their ordinary routine. With these various extraordinary developments, all inclined to make men cautious, coming month after month it is not surprising that trade recovery should have received a check from the peak activity of mid-summer, though the purpose was to promote such activity, and that the upward pace should not have been resumed until towards the very end of the year. On top of it all, it must be remembered that the establishment of the different codes and the imposing of the various processing taxes served to bring about a higher level of commodity values, and this in itself acted as a deterrent upon trade activity inasmuch as buyers in many cases were reluctant to pay the higher prices and producers and manufacturers cut their production acoordingly. Trade statistics in the leading industries all show that trade was slackening during the autumn, especially in the so-called heavy industries, but the steel statistics furnish perhaps the best illustration of the year's variations in the scale of activity. At the time of the general bank suspensions in the early part of March the steel mills of the country were operated to only about 14% of capacity. From this figure there was an increase to 57% in August but after this there was a rapid decline and by the end of that month was down to 47% and thereafter the rate continued to recede and in November dropped as low as 25.2%. In December, on the other hand, there was rapid recovery, contrary to the seasonal trend, and on Dec. 18 the American Iron & Steel Institute reported that steel mills of the country were operating to 34.2% of capacity. On Dec. 26 the Iron & Steel Institute estimated production a little smaller, at 31.6% of capacity, but the "Iron Age" of Dec. 28 stated that steel output had rebounded to 37%. At the beginning of 1934 the American Iron & Steel Institute reported production at 29.3% of capacity. The statistics of actual production by months tell the story with perhaps greater emphasis. The American Iron & Steel Institute estimated the production of steel in March 1933 at only 909,886 tons or 15.50% of capacity. From this there was a rapid increase, month by month, to 3,203,810 tons in July, or 58.95% of capacity. Then production again fell off and in November the steel output was only 1,540,882 tons or 27.26% of capacity. The December production proved larger again, being estimated at 1,819,648 tons or 33.48% of capacity. For the year as a whole steel production is put at 22,878,571 tons, with the mills operating at 33.95% of capacity as against 13,322,883 tons for the calendar year 1932 when the steel mills were engaged to only 19.75% of capacity. Back in 1929, however, steel production aggregated 54,312,279 tons the mills then working at 89.05 of capacity. The record of pig iron production is much the same. According to figures of the "Iron Age" the make of coke pig iron in the first three months of 1933 ran only a little in excess of 500,000 tons each month; by August the make of iron had risen to 1,833,394 tons, after which there was a drop month by month until in November the production was down to 1,085,239 tons, with an increase again to 1,182,079 388 Financial Chronicle tons in December. For the calendar year 1933 the country's pig iron product reached 13,212,785 tons, which compares with 8,686,443 tons in the calendar year 1932, but with 33,522,840 tons in 1929. In some industries there was very little indication •of any growth of consequence, as compared with the year of such extreme depression as 1932. This was notoriously true of coal mining. The output of bituminous coal was relatively small all through the year except that in May, June, July, August and September the production ran above that of the corresponding month of 1932. But in October, there was a drop back again, the product being 29,656,000 tons in 1933 against 33,110,000 tons in 1932, in November 30,582,000 against 31,028,000 tons and in December 29,600,000 tons against 31,522,000 tons the previous year. For the 12 months of 1933 the quantity of bituminous coal mined in the United States was 327,940,000 tons as against 309,710,000 tons in the calendar year 1932;in 1929 the production of bituminous coal was 534,989,000 tons. The output of Pennsylvania anthracite in the calendar year 1933 was 49,399,000 tons against 49,855,000 tons in 1932. The building industry continued to lag far behind, but in the closing two months of the year also gave some evidence of revival. According to figures prepared by the F. W. Dodge Corp. contracts for new construction of all types awarded in the 37 States east of the Rocky Mountains in the calendar year 1933 covered a total outlay in the calendar year 1933 of $1,255,708,400 against $1,351,158,700 in the calendar year 1932, but comparing with $5,754,291,000 in 1929 and $6,628,386,000 for the calendar year 1928 and an excess of $6,000,000,000 in each of the three calendar years preceding. For November however betterment appeared as compared with the corresponding month of the preceding year and the contracts awarded had a money value of $162,330,600 in 1933 against $105,302,300. in 1932, while in December they covered a prospective outlay of $207,209,500 in 1933 against only $81,219,300 in 1932. The textile industry showed perhaps more pronounced activity than any other and particularly is this true of cotton goods. The demand for cotton goods was active even during the period of depression, the low prices prevailing stimulating sales, and when, after the bank suspensions in March, trade activity quickened generally the cotton goods industry was in the van of the procession, but even here there was some abatement of demand in the latter part of the year. Speaking generally the volume of business for 1933 ran in excess of the previous year, though in many lines only slightly so, but ran far behind all the immediately preceding years. The car loadings of revenue freight on the railroads of the United States afford a good indication of this, these loadings having aggregated 28,960,910 cars in the calendar year 1933 as against 28,179,952 cars in the calendar year 1932 but comparing with 37,151,229 cars in 1931; 45,717,079 cars in 1930 and 52,827,925 cars in 1929. These statistics are not in all cases in accord with the records of bank clearings as presented by us to-day. Bank clearings had suffered enormous shrinkages in 1930, 1931 and 1932, and now for 1933, strange as it may seem, show a further shrinkage, and the remark applies both to the clearings at New York, the financial center, and those outside of New York. As a matter of fact the clearings outside of Jan. 20 1934 New York show a much more pronounced further contraction than those of New York and doubtless the explanation is found in the numerous bank suspensions which occurred over the country. At New York the clearings show a decrease as compared with the low figures of the preceding year of 1.7%, while outside of New York the ratio of decline is 12.9%. There was nothing to stimulate activity in the financial district, as sometimes happens though Stock Exchange speculation was on a somewhat larger scale as will be noted from the figures given further below. As one illustration it was a poor period for the floating of new capital issues, or the bringing out of new securities. As shown by us last week in our special article on the subject, the grand aggregate of the new issues brought out during the calendar year 1933 was only $1,053,209,094 as against $1,730,282,424 in 1932„022,941,356 in 1931, $7,677,047,391 in 1930 and no less than $11,592,164,029 in the calendar year 1929. The clearings at New York were at their maximum in 1929 when they reached $477,242,282,161 whereas for 1933 they are down to $157,413,993,751, while outside of New York the peak figure was $249,642,350,486 in 1929 from which there has been a drop to $84,040,850,549 in 1933, as will be seen from the following table. YEARLY TOTALS OF BANK CLEARINGS. Year. 1933 1932 1931 1930 1929 1928 1927 1928 1925 1924 1923 1922 1921 1920 1919 1918 1917 1916 1915 1914 1913 1912 1911 1910 1909 1908 1907 1906 11:10It New York Clearings. Inc. or Dec. Clearings Outside New York. Inc. or Dec. Clearings. Inc. or Dee. $ % $ % 1 % Total 157,413.993,751 -1.7 84,040,850,549 -12.9 241,454,844,300 -5.9 160.138,463,783-39.2 96,495,830.646 -34.0 256,634,294,429-37.3 263,270,393,958 -24.2 146,298,095,962 -25.0 409,568,489,920 -24.5 347,109,528,120 -27.3 195,133,532,784 -21.8 542.243,060,904 -25.4 477,242.282,161 +21.8 249,642.350.486 +3.1 726.884,632.647 +14.7 391,727,476,264 +22.0 242,144,679.206 +3.7 633,872,155,470 +14.2 321.234,213.681 +10.6 233.875.528.415 +0.2 555.109,742.076 +8.0 290,354,943,483 +2.4 233.418.328,972 +2.1 523,773,772.455 +2.3 283.619,244.637 +13.5 228.596,560,498 +11.0 512,215.805.135 +12.4 249.868,181,339 +16.8205,801.161.i52 +3.1 455,759,342.491 +10.2 213,996.182.727 -1.8 199.456,248.672 +14.8 413.452,431.399 +5.6 217,900,386,116 +12.1 173.606.925.839 +7.7 391,507,311.955 +10.1 194,331.219.663 -20.0 161,256,972.863 -21.9 355,588.192,536 -20.5 243.135.013.384 +3.1 206.592.968.076 +12.3 449.727.981.440 +7.6 235,802.634.887 +32.0 181,982.219.804 +18.3 417.784.854,691 +25.7 178.533,248.782 +0.6 153,820,777.681 +18.7 332,354.026.463 +8.3 177.404.965,589 +11.5 129.539,760.728 +26.7 106.944,726.317 +17.2 159,580,6a6,690 +44.4 102.275,125,073 +32.4 261.855.773.663 +39.4 4,392.634 +33.2 77.253.171.911 +7.0 1.147,817.564,645 +20.9 110,5 , 83.018,580.016 -12.3 72,226,538,218 -3.9 155,245,118.234 -8.6 94,634.281.984 -6.1 75.181.418.616 +2.7 169.815,700,600 -2.4 100,743.967.262 +9.1 73.208.947.649 +7.9 173.952,914,911 +8.6 92,372.812.735 -5.0 67,856,960.931 +1.6 160,229.773,686 -2.4 97,274,500.093 -6.1 66.820,729.906 +7.3 164.095.229.999 -1.0 103.588.738.321 +30.7 62.249,403,009 +17.2 165.838.141,330 +25.2 79,275,880,256 -9.1 53,132,968.880 -8.4 132.408,849,136 -8.8 87.182.168,381 -17.5 57.843,565.112 +4.8 145.025.733.493 -9.8 105.676.828.656 -12.5 55,229,888.677 3-10.1 159,905,717.633 +11.0 0/ 000 flan 909 4- AA 7 6t1 MIA 31411_2311 4-11.9 143 1197 AAA /LAI 197 7 Note.-Beglaning with 1920 clearings outside of New York do not Include St. Joseph. Toledo. and about a dozen minor places which In 1919 and previous years contributed regular returns, but now refuse to furnish reports of clearings. The omitted places added. roughly. 52,000.000.000 to the total In 1919. The comparisons assume a somewhat different aspect when the figures are divided up into months. When this is done heavy decreases appear in the first four months of the year, but increases for the remaining months with one single exception. In other words reviving trade was reflected in the returns of clearings as would be expected. We show first the clearings at New York by themselves as follows: MONTHLY CLEARINGS AT NEW YORK. Month. 1933. 1932. Inc. or Dec. 1931. 1930. 8 8 % 3 $ an ____ 12,645,925,025 16,684,334,129 -24.2 25,300,460,177 32,031,304,550 _ ._ 12,163,716,798 13,218,525.728 -8.0 21,223,273,592 25,987,648,907 dank._ 11,456,325,286 15,609,444,360 -26.6 26,168,384,982 33,765,058,127 St guar. 36,265.987,089 45,512,304,217 -20.3 72,692,118,751 91,784,011,584 quill- 10.788,823,011 13.968,822,093 -22.8 26,380,808,164 33,536,138.532 day _ 13,360,944.245 12,739,268,779 +4.9 24,943,808,883 31,428,917,920 tune ___ 15,824,579,591 13,901,886,901 +13,8 26,060,211,122 33,148,720,338 1S quar.. 39.974,346,847 40,609,957,773 -1.6 77,384,828,169 98,113,776,790 I mos.. 76,240,313,936 86,122,261,990 -11.5 150.078,746.920 139,897,788,374 ruly____ 16,081.871.465 11,675,263,288 +37.6 21,925,632,646 29,768,224,369 tug__ 13,418,766,731 12,666,982,889 +5.9 18,039,172,872 24,005,968,224 lept _ 12,457,775,003 13,278,860,378 -6.2 19,665,914,415 25,409.711,996 Id quar_ 41,936,413,199 37,621,108,555 +11.5 59,630,719,933 79,183,904,1589 1 11308_. 118,176.727.135 123,743,368,545 -4.5 209,707,466.853 289,081,692,963 )ct ____ 13.331,999,857 12,280,012,694 +8.7 20,713,098,910 28,883,958,922 by ___ 12,528,013,408 10,901,815,859 +14.9 14,451,403,344 22,183,294,985 3ec____ 13.379,253,352 13,233,266.685 +1.1 18,398,424,851 26,980,581,250 Sh guar 39,237,288,615 36,395,095,238 rear 107 419 99 700 160 130 4/13 7A3 +7.8 53,562,927,105 78,027,835,157 -11261270330 0011 Id, Inn 000 1 on Financial Chronicle Volume 138 Outside of New York the showing is somewhat different, but is in full harmony with the results for the 12 months as a whole in showing less recovery than at New York City. As a matter of fact these clearings outside of New York compare unfavorably with those of the preceding year in all but two months. This suggests some kind of reason for this and it is no doubt ascribable, as already intimated, to the fact that so many banks had to close down. MONTHLY CLEARINGS. Clearings, Total AU. 1933. 1932. % 1933. 1932. For the year as a whole the sales on the New York Stock Exchange during 1933 ran up to 654,816,452 shares as against 425,228,894 shares in the calendar year 1932rand 576,818,437 shares in 1931 but comparing with 1,124,991,490 shares in 1929. In the table we now present we show the aggregate of the sales on the New York Stock Exchange for each year back to 1880. NUMBER OF SHARES SOLD AT THE NEW YORK STOCK EXCHANGE BY CALENDAR YEARS. Cal. Year. Clearings Outside New York. Month. % S S $ $ Jan.__ 20,135,759,034 26,447.984,113 -23.9 7,489,834,008 9,763,649,984 -23.3 Feb_ _ _ 18,388,473,930 21,333,355,246 -13.8 6,224,757,132 8,114,829.518 -23.3 Mar__ 16,451,695,180 24,486,131,521 -32.8 4,995,369,914 8,876,687,161 -43.7 1st qu_ 54,975.928,144 72,267,470,880 -23.9 18,709,961,054 26,755,166,663 -30.1 Apr_ _ _ 16,697,033,774 22,826,372,573 -26.9 5,908,260,763 8,857,550,480 -33.3 May.. 20,044,745.772 20,667,501,203 -3.0 6,683,801,527 7,928,232.424 -15.7 June__ 23,271,434.469 21,918,490,620 +6.2 7,446,854,878 8.016.623.719 -7.1 2d qu_ 60,013,264,015 65,412,364,396 -8.3 20,038,917,168 24,802,406,623 -19.2 389 Stocks. Shares, 1933_ - 654,816,452 1932 _ _ 425,228,894 1931 _ _ 576,818,437 1930 _ _ 810,038,161 1929 _ _ 1124,991,490 1928_ 919,661,825 1927.. 576,563.218 1926 _ _ 450.845,256 1925_ _ 454,404,803 1924.. 281,931,597 1923 236,115,320 1922 _ _ 258,652,519 1921 _ _ 172,712,716 Cal. Year. Stocks. Shares. Cal. Year. 1920.. 226,640,400 1919 _ _ 316.787.725 1918.. 144.118.460 1917 - 185.628.948 191O 233.311.993 1915.. 173,145.203 1914 __ 47.900,568 1913 _ _ 83,470.693 1912 .._ 131.128.425 1911 127.208.258 1910 __ 164.051.061 1909.. 214.632.194 1908 -_ 197.206,346 1907 - - 196.438.824 Cal. Year. Stocks. Shares. 1892 .... 1891 -1890 18119 1888 -. 1887. 1886 -1885 - _ 11184 _1883 _1882 1881 1880 85.875.092 69,031.689 71.282,885 72.014.000 65.179.106 84.914,616 100.802.050 92,538.947 96.154,971 97.049.909 116.307.271 114.511.248 97,919.099 Stocks, Shares,. 1906 __ 284,298,010 1905... 263,081.156 1904 187.312.065 1903.. 161.102.101 1902 __ 1844.503.403 1901 265.944.659 1900.. 138.380,184 1899.. 176.421.135 1898.. 112.699.957 1897 77.324,172 1896.. 54.654.096 1895 __ 66.583.232 1894 __ 49,075.032 1893 __ 80,977.1439 6 mos_ 114989 192 159 137679835276 -16.5 38.748.878,222 51,557,573,286 -24.8 July__ 24,050.889,372 19,296,068,085 +24.6 7,989,017.907 7,620,804,797 +4.8 Aug___ 20,710,733,315 20,006,557,435 +3.5 7,293,966,584 7,339,574,046 -0.6 Sept... 19,736.181,276 20.601,940,247 -4.2 7,278,406,273 7,323,079,869 -0.6 3d qu_ 64,497,803,963 59,904,565.767 +7.7 22,561,390,764 22,283,459,212 +1.2 Not only, however, was the volume of dealings in stocks large, but bond sales were also of goodly proportions and the following furnishes a three-year comparison for the bond sales: 9 mos. 179 486996122 197584401 043 -9.2 61,310,268,986 73,841,032,498 -17.0 SALES OF STOCKS AND BONDS ON NEW YORK STOCK EXCHANGE. Oct.. 21,114,240,815 20,006,115,358 +5.5 7,782,240,958 7,746,102.664 +0.4 Nov __ 19,822,502,632 18,087,617,562 +9.6 7,296,489,226 7,185,801,703 +1.5 Deo__ _ 21,031,104,731 20,956,160,466 +0.4 7,651,851,379 7,722,893,781 -0.9 Description. 1933. 1932. 1931. 4th qu. 61,967,848.178 59,049,893,386 -1-4.9 22,730,581,563 22.654,798,148 +0.3 Stock-Number of shares 12rnns 241454844190 2RA112490,1,190 Railroad and miscellaneous bonds $2,099.167.400 51,641.629.250 51,846,035.700 United States Government bonds... 501,167,950 569,922,850 296,117,550 State, foreign, Sce., bonds 768,568,500 755,132.600 908,455,600 __ma QA nen sun u.,000 404 SOn AAA -190 Of course records of bank clearings are always more or less affected by the volume and extent of the speculation on the New York Stock Exchange and this during 1933 was on a much larger scale than in the two years immediately preceding. The increase extended to all the different months of the year, except January, February and March. To show the increase in Stock Exchange speculation in 1933, and as a matter of fact, to present a record of the transactions on the New York Stock Exchange for each month of the last five years we now introduce the table below: SALES OF STOCKS ON THE NEW YORK STOCK EXCHANGE. 1933. 1932. 1931. 1930. 1929. No. Shares. No. Shares. No. Shares. No. Shares. No. Shares. Month of January _ _ 18,718,292 34.362,383 42,503,382 62.308.290 110.805.940 February 19,314,200 31,716,267 64,181.836 67,834,100 77.968.730 March._ -- 20,096,557 33.031,499 65,658,034 96.552.040 105,661.570 576,818,437 53 UR MR fiso 52.086.684.700 53_050.608.850 In treating of stock speculation at New York it is necessary to take into account also the dealings on the New York Curb Exchange, where the business involves a very extensive body of other stocks and bonds. Here, also, there has been a considerable expansion in the volume of transactions at least in the case of the stocks, the aggregate of these for the calendar year 1933 having been 100,920,771 shares as against 56,975,777 shares in the calendar year 1932. Back in 1929 the dealings in stocks on the Curb Exchange totaled 477,278,229 shares. In the following we compare the transactions on the New York Curb Exchange for a series of years past: NUMBER OF SHARES AND VALUE OF BONDS SOLD AT NEW YORK CURB EXCHANGE BY CALENDAR YEARS. Total third quarter 206,061,989 173,064,133 109,414,318 141.160.735289,139.700 Total nine months 546,921,118 349,782,705 441,407.778 633,829,445 827,006.000 Month of October... 39,372,212 29,201,959 47,896,533 65.497,479 141.668.410 November 33,646,666 23,054,483 37,355.208 51,946,840 72.455.420 December_ 34,876,456 23,189,747 50,158.818 58,764,397 83.861.660 Total fourth guar. 107,895,334 75446,109 135,410,559 176,208,716 297,985.490 Tot,second six mos 313,957,323 248,510,322 244.824.877 317.369,451 587,125.190 654.816 452 425 225 504 676 818.337 810.038 161 1124001 son 100,920,771 56,975,777 110,349,385 222,286.725 477.278.229 221,171,781 1097 lomlia usa 1 aia a a a a a a aisioi .1.18. 1933 1932 1931 1930 1929 1928 JFIAMOOrga s OCCOCOC, WWW.NI, 2 ..NWIP.CAO a a lila Bonds. Stocks, Shares. p.7=1.1...Wrg;03 .10-40.0WW 340,859,129 176,718,572 331,993,460 492.668,710 537,886.300 Month of July 120.271,243 23,057,334 33,545.650 47,746.090 93,378 690 August_ _ 42,456,772 82,625.795 24,828,500 39.869.500 95.704,890 September 43,333,974 67.381.004 51,040,168 53,545,145 100.056.120 Total full year._ 425,228,894 58,129,049 99,110,149 172,343.252 226,694,430 294.436.240 52,896.596 31,470,916 54,346,836 111.041.000 82.600.470 104,213,954 23.136.913 46,659,525 78.340.030 91.283.550 125,619,530 23,000.594 58,643.847 76.593,250 69,546.040 Total second guar. 282,730,080 77.608,423 159,650,208 265,974.280 243.430.060 Tota six months Total oar value of llAIlflQ AW0100,004, .1WC:10,0,4 Total first quarter_ Month of April May June 654,816,452 Stocks, Shares, Bonds. $ 115,531,800 38,406,350 72,243,900 50,968,680 21,741,230 15,522,415 525,810,000 500,533,000 200,315,000 90,793,000 55,212,000 25,510,000 Turning now to the records of clearings classified according to Federal Reserve districts, the feature here is that each and every one of these Reserve districts with a single exception shows a further reduction in clearings for 1933 after the long series of antecedent decreases. The only exception to the rule is the Minneapolis Reserve district and there the upward turn in 1933 has been trifling, being less than 1% as will be seen by the following table: SUMMARY OF BANK CLEARINGS. Federal Reserve Districts. No. Cities 1933. 1932. let Boston 2nd New York 3rd Philadelphia_ _ _ lth Cleveland 5th Richmond 6th Atlanta 7th Chicago 8th St. Louis 9th Minneapolis.. 10th Kansas City _ _ 11th Dallas 12th San Francisco 14 13 14 13 9 16 27 7 13 14 10 22 $ 10,827,090,398 161,832,859,227 13,045,665,525 8,739,310,278 4,129,900,342 4,226,715,924 13,677,091,912 4,458,444,386 3,725,343,941 5,458,314,137 3,101,842,485 8,232,265,755 $ 12,228,772,708 165,145,310,068 14,801.916,127 10,237,489,676 5,507,126,307 4,568,550,464 17,255,769,616 4,635,322,762 3,693,211,987 6,184,439,289 3,150,573,108 9,225,812,317 Total Outside N. Y. City_ 172 __ ranads.. 32 Decor Dec. 1931, 1929. 1928. 1927. 1926. 241,454.844.300 256,634,294,429 -5.9 409.568,489,920 542,243,060,904 726,884,632,647 633,872,155,470 555,109.075.670 523.773.772.455 84,040,850,549 96,495,830.646 -1%9 146,298,095,962 195,133,532,784 249,642,350,486 242.144.679.206 233.874,162,009 233.418,828,972 14,720,601.016 12,909,613.40 +14.0 16,843,377.54,5 20 non OM annl OgnAn 754 QQA ,A AAA OA° 1.AA on AAA .,an lien 1, AAA nnl All It seems des'rable also to have again the record for the leading cities for a long period of years. Accordingly we insert here as on former occasions the table below carrying the comparisions back for nine years. It will be observed that here too the preponderating number of cities show smaller clearings totals for 1933 than for the years immediately preceding. 1930. % 8 $ S S 3 3 -11.5 20.712,338,670 25,914,935,994 31,158,917.523 29.134,572,808 29,608,240,625 28.182.070,347 -2.0 270,170,414,617 355,520,907.309487,551,440,643 400.416,198.002 329.460,401.556 298,325.474,068 -11.9 21.079,719,290 28,151,933,548 33.989,427,506 31.554,665,027 30,564.388.289 31.434,818,164 -14.6 15,753 157 856 21.145,822,948 24,535,091,978 22,728,442.163 22,012,742.276 21,582.647,725 -25.0 7,332,845,298 9,076,063.3171 9.834,565,649 9,785.185 874 10,335,542,052 10.901,020,215 -7.5 6,350,511.970 8,156,611,273 10,118,234,208 10.114,722,180 11,108,531,915 12.456.123,556 -20.7 30,448,706,642 43,810.366.289 56,270,138,889 56.385,204.739 52,677,335,684 51,641,391.122 -3.8 6.506.155.423 9,396.706,7271 11,787.219,456 11,932,994.630 11,757,013,950 11.894.757,283 +0.9 4.912,275,129 6.135,244,3721 7,268,782,624 7,178.775,087 6.751.071.502 6,765.505.827 -11.7 8,754,834,077 12 ,1111,213,880, 15,592.440,205 15,290,803,666 14,802,120,305 14,873.742,285 -1.5 4,305,930,032 5,344,350,2521 6.951,359,197 6,633,537,743 6,558.572.517 6.812,696,906 -10.8 13.241,600.916 17,482,397,665 31,827,014,769 32.717,053,551 29.472.714.999 28,903,424.957 With reference to the dealings at the different stock exchanges, we have already commented on the share and bond transactions for the New York Stock Exchange and have also given the total for the New York Curb Exchange. At the outside stock exchanges dealings, as in the case of New York, increased in 1933 in most cases over the small totals of the preceding year. 390 Financial Chronicle Jan. 20 1934 CLEARINGS AT LEADING CITIES. is7,614,522 6,592,342 10,589,837 27,234,794 35,520,785 17,649,062 7,959,556 10,174,589 6,297,878 3,434,690 2,319,270 2,456,631 1,579,470 2,367,312 3,230.740 1,560,188 3,948,602 11,089,222 5,882,125 6,057,074 8,287,827 9,401,361 9,087,564 14,310,920 44,418,116 42,996,225 30,444,191 53,096,390 31,330,450 6,635,800 Pittsburgh1933 2,409,566 1932 1,551,968 1,625,014 1931 53,542,446 1930 1929 5,300,096 2,013,255 1928 1927 1,347,563 1926 1,562.769 1,778,138 1925 1924 1,372,711 2,506,032 1923 2,230,146 1922 1921 2,630,740 1920 4,153,769 1919 5,579,055 1918 6,072.300 • Baltimore1933 635,743 1932 350,285 1931 504,880 1930 712,780 1929 1,300,707 1928 1,019,056 1927 919,365 1926 590,730 1925 951,426 1924 468,063 2,137,500 2,033,700 3,034,300 6,436,900 7,947,300 9,004,106 12,032,800 7,882,500 9,623,000 8,246,000 St. Louis1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 145,399 165,041 380,354 548,800 1,304,229 1,077,984 500,601 382,839 591,667 139,482 161,000 194,500 590,212 1,730,224 1,838,556 2,365,928 3,840,360 2,325,000 2,355,200 2,424,100 Detroit1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 13,672,390 10,299,500 12,419,793 15,251,177 24,652,115 18,240,330 8,807,874 9,562,931 9,912,352 5.300.862 4,783,324 5,495,041 3,974,005 6,696,423 9,235,751 3,929,008 5.090,982 13,078,588 12,603,768 1,243,800 1,870,000 3,370,800 5,599,376 11,147,245 8,726,199 7,742,313 7,153,447 8,141,090 15,613,169 20,294,840 28,488,950 16,323,920 24,674,300 28,039,700 119,000 43,000 100,000 284,000 125,000 187,000 214,000 168,000 396,500 475,000 801,350 1,145,150 1,318,950 2,986,050 4.069,800 Total Year. Fourth Quarter NUMBER OF SHARES AND VALUE OF BONDS SOLD AT MONTREAL STOCK EXCHANGE BY CALENDAR YEARS. Stocks, Shares. Bonds. $ 7,663,533 2,897,388 5,264,818 11,047,472 23,203.463 18.990,039 9,992,627 6,266,440 8.598,192 6,611,580 11,023.025 13,212,655 20,139,200 16,077,600 17.807.921 a 751 570 Bonds. $ Stocks, Shares. 4,316,626 2,686,603 2,091,002 2,910,878 2,068,613 4,177,962 3,865,683 1925 1924 1923 1922 1921 1920 1919 17,715,503 22,153,753 38,003,500 48,819,402 67,776,342 27,340,080 71,681,901 NUMBER OF SHARES SOLD AT TORONTO STOCK EXCIIANGE BY CALENDAR YEARS. 4,089,671 2,775,956 3,843,225 5,065,720 11,434,665 10,227,019 2,786,915 1,852,451 3,264,164 2,485,894 Los Angele 53,228,819 1933 3,068,749 1932 5,450,543 1931 9,171,442 1930 15,406,993 1929 49.403.086 1928 27,082,349 1927 44,067,288 1926 36,230,111 1925 24,131,644 1924 Third Quarter. The Canadian Stock Exchanges-Montreal and Toronto -also have a larger volume of business to their credit for 1933 than for 1932 as will be seen by the following. I Boston1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 1923 1922 1921 1920 1919 1918 1917 1916 1915 I 1,433,000 10,597,000 12,480,500 27,462,000 4,975,500 7,534,600 14,827,950 7,941,300 8.748,300 22,604,900 19,954,850 10,028,200 4,170,450 4,652,400 5,672,600 5,305,000 8,368,950 11,932,300 9,316,100 854,500 1,530,000 2,381,000 2,457,500 3,384,500 2,857,000 6,791,000 15,071,500 28,101,000 38,426,000 38,130,000 67,013,600 70,342,050 61,870,800 34,073,000 18,834,600 15,710,075 15,705,680 9.948.000 $ $ S S $ ,804,876,144 3,670,546,814 4,392,332,361 3,852,845,697 14,720,601,016 ,103,494,918 3,189,615,159 3,248,885,858 3,367,617,474 12,909,613,4 9 ,148,010,920 4,632,082,461 3,806,438,089 4,256,846,076 16.843.377,5 5 ,952,120,236 5,207.727.3744,791,115.007 5,164,057,073 20,094.909,690 6.016,432.641 6,041,113,661 6,170.260,921 6.857,231,90225,085,039,1 5 7.171.369.336 24,566,298,5 9 a,.540,519,953 6,224.576,655 5,619,332.605 ,324.149.204 4,910.336.763 4,737.796,279 6.594,208.610 20,566,490,8 .929.891,000 4.388.475.000 4,217,059.000 5.111,536,000 17,646,961,0 3.708.304,000 3.854.678.000 3.904,277,000 5,263,984,000 16,731,243,0 16,977,924,0 a.834.897,000 3,950.010,000 4.072,622.000 5.120,395.000 .606,308.000 4,168.184.000 3,864,938,000 5,702,913,000 17,332,342,0 .840.001.000 4.031,429,000 3,706.793,000 4,685.582.000 16,263,805.0 .127,525.000 4.447.088.000 3,983,965,000 4,886.142.000 17,444,720,0 ,638,357.000 4,924.428,000 4.819,806,000 5,849.805,000 20,232,406,0 .329.475.000 3.970.8133.000 4,127.237,000 5.275.350,000 16,702.925.0 0 .818,417.000 3.387.131.000 3,212.600,000 4.300.425.000 13,718,573.0 0 .657.205.000 3,363.807.000 2.923.735.000 3,611.971.000 12,656.718.0 2.450518.000 3.236.383.000 10.506.599.0 1A0 01A non 1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 1923 1922 1921 1920 1919 1918 1917 1916..._ I 18,289,000 15,642,000 34,404,200 69,747,500 82,216,000 38,941,589 10,712,850 10,253,664 14,102,892 10,849,173 13,337,361 9,145,205 5,165,972 7,367,441 7,308,855 2,032,392 1,701,245 1,610,417 715,557 Bands. $ . Second Quarter. PIM Quarter. Clearings Reported. lllll Chicago1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 1923 1922 1921 1920 1919 1918 1917 1916 1915 0 Philadelph 1933 1932 1931 1930 1929 1928 1927 1926 1925 1924 1923 1922 1921 1920 1919 Stocks, Shares. I Stocks, Shares. Bonds. $ San Franc isco 8,129,554 1933 1932 7,058,715 1931 9,875,057 15,262,932 1930 19,188,822 1929 31,530,016 1928* 11,332,159 1927* 9,702,078 1926* 9,464,660 1925* 6,848,625 1924* 5,948,638 1923* 1922* 2,863,850 1,599,410 1921* 1,873,326 1920* 893,600 1919* 357,433 1918* 619,844 1917* 450,134 1916* 1915* 137.160 CLEARINGS IN THE DOMINION OF CANADA , I NUMBER OF SHARES OF STOCKS AND VALUE OF BONDS SOLD AT EXCHANGES OUTSIDE OF NEW YORK. I In[the tables we now give we show the sales in these outside cities, not only for 1933, but for several years preceding. I a will no longer report clearings. Bonds. $ As to the Canadian bank clearings these make a better comparison in showing that the larger cities like Montreal, Toronto, Winnipeg and Vancouver show larger totals for 1933 than for 1932, even though in the case of the smaller cities the experience has been the same as that in this country with the 1933 totals falling below those for 1932. By reason of the gains to the credit of the larger cities total bank clearings for all the reporting cities in the Dominion show a larger aggregate than for 1932, this being unlike the experience of the United States, the grand total for 1933 standing at $14,720,601,016 in comparison with $12,909,613,409 for 1932 as will be seen by the following. I Total all. 241,455 256,634 409.568 542,243 726,885633,872 555,110523,773512,216 Ou tsideNY 84,0411 96,496 146.299'195,133249.642 242,144 233,876233,419228,597 Stocks, Shares. Bonds. $ *For fiscal years ending Sept. 30. I 224,741 237,273381,450505,634678,731 587,866 509,330476,462466,154 16,714 19.3611 28,118j 36,609 48,154 46,493 45,780 47.321 46,082 Cleveland-1933 488,281 1932 407.463 1931 519,460 1930 779,056 1929 2,007,110 1928 2,117,549 1927 1,263,708 1926 1,035,383 1925 1,859,390 1924 736,976 1923 846,055 1922 833,957 1921 843,644 1920 943,257 1919 725,970 1918 176,463 1917 329,478 1916 399,507 1915 88.065 I I I New York. 157.414160,138 263,270347,190477,242 391,727321,234290.354283,619 Chicago _ 9,612 10,937, 19,201 28,707 36,71 37,842 35,958 34,907 35,392 Boston - - _ - 9,405 10.554 18,373 23,070 27,610 25.829 25,468 25,130 22,482 Philadelphia 12,424 13,970 19,7011 26.360 31.837 29.377 26,354 29,258 29,079 St. Louis_ _ 2,897 3,0707,278 7,566 7,387 7.632 7,627 Pittsburgh _ 3,795 4,160 8,656 9.240 10,163 9,453 9,289 9,198 8.857 San Fran._ 4,685 5,054 7,142 9.659 10,938 11,491 10,118 9.800 9,479 Baltimore__ 2,044 2,893 3,852 4,820 5,287 5,260 5,618 5,974 5,832 Cincinnati _ 1,815 2,089 2,838 3.203 3,911 3.901 3,877 3,885 3,710 Kansas City 2,864 3,186 4,400 6,302 7,451 7,254 7,245 7,302 7,036 Cleveland__ 2,531 3,3441 5,123 6.6381, 7,964 6,913 6,457 6,179 5,997 N. Orleans. 930 1,362 2,010 2,316 2,734 2,908 3.056 3,085 3,170 Minneapolis 2.518 2,1138 3,172 4.0161 4.705 4,421 4,095 4,110 4,463 Louisville.. 916 911 1,134' 1,850 1,941 1,936 1,880 1,782 1,744 Detroit_ _ 1,941 3,236 6,167 8,440 11,558 10,434 8,770 8,813 8,431 Milwaukee. 774 1,157 1,487 1,825 2,158 2,246 2,200 2,062 562 LosAngeles a a 10,066 10,826 9,382 8,917 7,945 a a 729 714 718 Providence_ 379 428 814 574 684 876 Omaha_ _ _ 997 1,102 1,7251 2,183 2,398 2,312 2,102 2,104 2,188 Buffalo _ _ 1,206 1,294 1,930 2.594 3,396 2,853 2,736 2,727 2,782 St. Paul_ _ _ 760 7681 1,016' 1,200 1,438 1,626 1,556 1,617 1,631 904 490 1,286 1,208 1,208 1,192 Indianapolis 850 1,09 6301 Denver_ _ _ _ 862 960 1,295 1,694 1,861 1,864 1,733 1,689 1,668 2,517 2,610 2,839 2,333 2,32 Richmond - 1,288 1,369 1,749 2.28 1,173 1,192 1,197 1,233 1,2 551 660 9 Memphis.- • 600 2,654 2,543 2,367 2,353 2,205 Seattle_ _ _ _ 925 1,141 1,563 1,99 832 801 763 904 1,035 42 589 76 Hartford_ __ 421 924 922 898 954 460 918 1,035 Salt L. City 49 715 Total_ Other Stocks, Shares. 1925. I I 1926. I I 1927. I I 1928. I 1929. I I 1932. I 1931. 1 1930. $ $ 00000000 s2 M.G.,CO CO CO 3/ , 100400.—,D42 1933. $ (000,000s omitted.) Stocks, Shares. 12,709,268 3,238,478 2,973,358 6,638,594 10,471,819 5,916,923 4,663,042 1933 1932 1931 1930 1929 1928 1927 151,000 148,000 623,500 2,800,500 779,500 11,351,500 10,707,000 18,392,900 33,243,300 26,513,400 I Not including 446,433 sales of "rights." Stocks, Shares. 2,470,167 1,999,218 907,871 1,025,923 1,214,543 648,017 670,064 1926 1925 1924 1923 1922 1921 1920 To complete our analysis we now give the complete statement of the clearings at the different cities in the United States for the last eight years, classified according to Federal Reserve districts and also the ratios of increase or decrease as between 1933 and 1932. The Canadian bank clearings in detail for the last eight years are added at the extreme end of the compilations. BANK CLEAR]NGS IN DETAIL FOR THE LAST EIGHT CALENDAR YEARS ACCORDING TO FEDERAL RESERVE DISTRICTS. Clearings atFirst Federal Reserve D Maine-Bangor Portland Mnseachusette-Boaton Fall River Holyoke Lowell New Bedford Springfield Worcester .... Connectieut-Hartford ..... New Haven Waterbury Rhode Island-Providence. N. 11.-Manchester Total (14 cities) Year 1933. Year 1932. $ $ istrict-Bosto n21,736,216 22,021,462 112,486,341 72,724,139 9,405,283.453 10.553,707,435 35,521,668 27,622.253 20,442,820 17,584,571 15,898,748 14,430,010 31,131,456 27,661,969 160,313,913 132,658,694 103,799,943 62,095,190 423,792,173 420,508,392 173,211,347 241,624,711 56,581,600 51.056,000 428,493,500 378,617,900 23,243,184 21,615,018 Inc. or Dec. % Year 1931. $ Year 1930. Year 1929. Year 1928. $ S $ Year 1927, $ Year 1926. 8 35,894.326 +1.3 30,871,677 35.535,067 42,555,464 34,873.633 39,196,075 -35.3 202,544,646 157,470,412 220,868.588 197,891.247 197,868,116 192,468.223 -10,9 18,373,439,759 23,080,468,729 27,600.034.885 25.828.975.499 26,468,065.274 25,130,344.097 -22.2 85.578,004 48,965,338 70.549.077 107,131,493 57,280.304 103.832.149 35.209,151 -14.0 26,973,066 33.430,307 46.683.818 30.299.066 45,041,238 -9.2 62,880,710 24,476,328 65,441.362 63,500,525 38.136.771 56.863,614 -11.1 68,428,583 46,114,827 68,951.283 65,623,291 53.088.956 68,898,612 -17.3 297,921.246 296,082,026 225,083,803 283.174.997 243.701,444 299,931.604 -40.2 96,246.099 187,941.048 145,679,693 174.694,717 186,433,169 190,236,622 -0.8 589,290,196 903.867,710 768,282.453 1,035,442.166 832.271,077 800,645,811 -28.3 468.600.000 454.489,602 347,367,091 401,300,685 373,982.839 412,492,500 -9.8 139,691,400 131,318,200 92,233,400 111.115,600 133,611,000 125,216.600 876,117.400 -11.6 813,885,600 573,896,200 683.796.100 729,416,100 714.045,000 -7.0 40,088.643 37.478,703 30,476,880 40.029,420 39.390.670 41,367.963 10.827.090.398 12.228.772.708 -11.5 20.712.338.670 25.914.935.994 31.158.017.523 29.134.573.808 29.1491.240 525 25 159 010 2417 391 Financial Chronicle Volume 138 BANK CLEARINGS IN DETAIL FOR THE LAST EIGHT CALENDAR YEARS ACCORDING TO FEDERAL RESERVE DISTRICTS-(Continued). Clearing., cu- Year 1933. Year 1932. Inc. or Dec. Year 1931. Year 1930. Year 1929. Year 1928. `70 $ $ $ $ $ S Second Federal Reserve District-New York419,502,248 New York-Albany 269,461,242 Binghamton 39,234,033 42,310,615 Buffalo 1,206,417,400 1,294,195,734 Elmira 28,551,043 35,458,350 19,494,833 Jamestown 29,194,920 New York 157,413,993,751 160,138,463,783 a Niagara Falls a Rochester 303,418,066 360,161,965 161,292,631 Syracuse 191,618,716 Connecticut-Stamford_ _ _ _ 127.310,307 131,936,253 20,302,153 27,849,237 New Jersey-Montclair. _ Newark 785,376,529 1,100,022,410 1,269,343,976 1,463,517,273 Northern New Jersey 38,622,257 Oranges 61,119,570 'l'otal (13 cities) 161,832,859,227 165,145,310,068 Year 1927. $ Year 1926. $ 338.712.898 331,980,049 339,980,431 325,552,925 353,497,666 322,865,780 +55.7 78.010,459 60,305.169 56,384,503 71,452,235 70,199,795 66,019,910 -7.3 -6.8 1,929,918,055 2.604,443,330 3,395,939.862 2,849,617,173 2,735.746,437 2,726,662,610 59,094,042 58,298,891 50,753,092 51,364,283 53,788,254 53,208,693 -19.5 71,092,338 77.093,639 69,884,650 45,134,008 61,741,471 73.230,583 -33.2 -1.7 263,270.393.958 347,109,528.120 477,242,282,161 391,727,476,264 321,234,213,661 290,354,943,483 78,778,486 55.359,559 83,203,418 a a 66,051,202 a 850,955,176 776,900.082 684,858,080 599,571,946 729,305,528 494,981,674 -15.8 319,368,064 384.869,476 346,594.405 338,123,241 290,261,978 248,170,737 -15.8 240,409,568 215,061,704 188,037,428 208,474,112 200.103.084 170,732,540 -3.5 50,227,722 47,157.825 42,494,630 36,619,217 41,073,525 46.047,766 -27.1 1.790.926,944 1,873,545,343 1,520,154.962 1,374,097,957 1,309,996,214 -28.6 1,541,778,681 -13.3 1,918,084,694 2,250,855.686 2,797,244,114 2,221,489,574 2,139,849,263 2,036,418,567 97,011,847 87,766.388 78,015,034 81,910,533 88,788,453 80,958,890 -36.8 -2.0 270,170,414,617 355,520.097.309 487.551,440,643 400,416.198,002 329.460,401,556 298,325,474.068 Third Federal Reserve District-Phil adelphia80,669,927 78,710,687 84,490.339 Pennsylvania-Altoona. _ 86,818,244 14,034,378 20,297,762 -30.9 36.463,654 68,868,072 276,486,497 245,797.295 238.163,397 Bethlehem 246,606,709 e4,124,475 25,223,004 -83.6 42,135,288 225,717,798 63,824,255 67,798,586 73,814,118 74,320.524 Chester 13,412,343 19,884,920 -32.6 45,621,398 54,190,321 246,312,192 246,128,739 253,099,487 247,771.510 Harrisburg 170,873,868 79,752,063 119,873,195 -33.5 222.550,947 118,782,669 108,996,383 111,963,090 115,838.586 119,589,616 100,081,996 Lancaster 38,519,222 59,477,435 -35.2 32,773,481 33.643,772 35,265,231 Lebanon 28,219.603 33,580,050 17,165,764 -10.2 34,870,724 15,412,473 46,949,014 52.385,945 47.836,493 38,811,301 48.945.988 Norristown 22,992,290 -10.7 33,320,866 20,529,926 Philadelphia 12,424,000,000 13,970,000,000 -11.1 19,701,000,000 26,360,000,000 31,837,000,000 29,371,000,000 28,354.000,000 29,258,000,000 225,803,124 223.751.703 219.885,671 221,391,913 178.233,147 Reading 54,918,745 109,410,166 -49.8 151,266,900 335,876,651 329,092,841 326,296,868 330,825,930 Scranton 95,195,428 122,899,479 -22.5 214.088,598 245.741.796 191.824.257 210,527,730 206,040,804 212,591.319 148,081,121 178,381,878 Wilkes-Barre 89,952,506 -17.4 74,302,077 106,563,636 97,955,116 112,795,414 96,368,743 87,995,778 105,501,365 York 58,915,606 -13.4 51,038,395 133,901,188 133,294,254 163,586,890 142,807,716 118,145,203 New Jersey-Camden a a a 84,837,000 342,917.863 327,539,087 281,466.066 352,521,057 220,839.000 Trenton 160,426,000 165,824,000 -3.3 216,225,600 Total (14 cities) 13,045,665,525 14,801,916,127 -11.9 21,079,719,290 28,151,933,548 33,989.427,506 31.564,665.027 30,564.388.289 31,434,918,164 Fourth Federal Reserve District-Cloy elandOhio-Akron e3,876,000 20.416,000 ..anton 43,371,165 Cincinnati 1,814,782,185 2,088,859,937 Cleveland 2,530,896,775 3,344,466,086 Columbus 346,380,650 386,397,500 Hamilton 17,542,891 22,717,180 Lorain 3.745,165 6,169,892 Mansfield 44,241,485 40,929,770 Youngstown Pa.-Beaver County 7,976,340 10,225,223 Franklin 3,661,657 4,938,349 Greensburg 7,406,777 13,947,659 Pittsburgh 3,794,704,050 4,159,834,262 Kentucky-Lexington 43,810,966 53,541,288 West Virginia-Wheeling 76,914,172 85,046,530 T,Aal (13 cities) -22.0 -25.9 -46.9 -8.8 -18.2 -9.6 349,750,000 244,201.000 252.951,681 209,510,783 3,202,938,421 3.910,555,730 6.637.913,338 7,964,234,471 905,967,900 792.932,400 67,249,607 48,898.612 24,346,327 18,490,723 109.509.897 93.261,261 322,937,297 259,844,604 29,492,205 23,384,039 11,361,737 9,358,775 74,753,770 81,102,560 9,246,960,336 10,162,939,978 106,365,138 82,259,046 242,676,240 194,767,150 367,108,000 224,145,594 3,901,292.187 6,913,067,391 893,035.600 60,404,063 22,641.750 102,668.923 305.765.883 37,331,534 13,517,047 77,217,585 9,452,671,780 108,149,087 249,426,939 336.895.000 213.842.119 3,877.324.829 6.457.413,647 922.793.200 47,674,711 22,970.232 101,512,961 289.968,195 37.485,477 15,890,477 74,377,495 9,289,443.577 99.877,333 225.273.023 316,985,000 212,805.852 3,885.182.015 6,178,768,145 880.312,600 49.398,905 23.936,686 108.577,509 278,698,371 39,349,464 19,632,402 74,122,404 9.197.686,606 95,372,164 221.819,602 4,129,900,342 4,226.715,924 -60.5 -19.2 -5.9 -83.8 -6.6 -85.8 -29.3 -9.8 64,106,999 274,434,033 2,319,531,349 133,279,700 117,606,167 112,903.990 5.260.041.574 24,584,650 42,589,059 1,435.725,603 68,727,520 308.349,887 2.517,251,589 140,724,518 122,430,598 105.661.217 5,618.191,924 25.616,114 42.691,258 1.385,897,427 79,673,600 438,943.130 2,610.110.050 137,166.758 129,465,413 92,220.790 5,953,736,235 25,429,360 41,693.977 1,392,580,952 -35.4 1,233,276,777 5,507,126,307 -25.0 7,332.845,298 9.076,063,317 9,834,565,649 9,785,185.874 10,335.542.052 10,901,020.215 a 144,145,834 628.043,516 1,835,666.525 68,233,406 35,921,053 38,868.396 589,169.980 a 74,091,638 668,758,940 67.631,437 36,472,025 54,814.000 72,851,103 18,532.290 7,230,656 2.010,081,171 143,741,364 1,078,748,051 2,258,286,150 89,214.260 18,242,835 72,467,235 675.293,206 a 88,717,724 1,010,297.655 96,642,806 56.258,519 71,415,000 108,145,650 33,982.638 9,958,037 2,315,469.043 a 160,390,810 1,234,935,792 2.927,843.030 114,504,845 63,214.764 90,958,461 778,250,904 142,316,000 136.395,461 1,277,239.054 109,339,262 88,121,435 85,983,000 111,691,055 45,168,531 17,457,100 2,734,424,704 a 170,009.256 1,179.685,804 2.679.446.146 103.544,775 59,574.007 118,457.221 835.268,613 143,364,000 184,472.445 1,283,850,241 95,104,890 87.188.580 90,143,000 108.612,955 45.763,096 22,578,709 2,907,752.752 6,350,511,970 8.156,611,273 10,118,234.204 10,114,722,180 11,108,531.915 12,456,123,556 a +17.0 +1.7 +6.3 +5.2 -7.0 +3.5 -7.7 a -20.6 +11.1 +2.2 +3.9 +2.3 +75.5 -9.7 -1.7 -31.7 4,568,550,464 30,830,709 178,403,799 1,748,565.339 85,568,908 84,584,416 101,035,483 3,851.615,868 18,963,999 63,130.826 247,128,060 2,333,296,114 125,618,965 114,752.998 117,079,295 5,286,948,733 24.775,584 40,444,345 1,481,390,720 56,337,080 213,137,682 2,286.520,865 117.088,662 110,235,165 108,282,902 4,820,464,324 24,658.271 31.730,772 1,317,607,594 Sixth Federal Reserve D istrict-A tIan taTennessee-Chattanooga. a a Knoxville 148,907,909 127,219,199 Nashville 460,439,179 468,491,660 Georgia-Atlanta 1,503.200,000 1,414,100,000 Augusta 43,898,263 46,189,886 Columbus 22,603,056 21,023,029 Macon 24,902,278 25,784,256 Florida-Jacksonville 431,454,575 398,090,352 Miami a a Tam pa 53,475,171 42,459,628 455,305,130 Alabfuna-I31rminghani _ _ 505,819,864 Mobile 44,098,780 45,077,022 Montgomery 24,543,761 25,491,026 35,139,000 tAississippl-Hattlesburg_ 35,940,000 Jackson 49,260,840 e12,071,169 Meridian 14,065,389 12,697,339 Vicksburg 5,851,462 5,753,118 Louisiana-New Orleans.. _ 929,719,666 1,362,194,381 Total (16 cities) -24.3 -10.4 -22.8 -39.3 +8.1 142,973,000 b 2,837,577,247 5.123,450,082 602,282,400 36,640,370 13,906,676 73,516,115 b 16,603,484 7.229,156 38,941,357 6.655.620,424 62.092,335 142,325,210 8,739,310,278 10,237,489,676 -14.6 15,753,157.856 21,145.822,948 24,535,091,978 22.728,442,163 22.012.742,276 21,582.647,725 Fifth Federal Reserve D strict-RIchm ondWest Virginia-Huntington.. 7,720,027 19,532,286 Virginia-Norfolk 109,025,000 136,068,783 Richmond 1,288,377,374 1,369,431,275 North Carolina-Raleigh _ _ 15,809,052 35,824,898 South Carolina-Charleston 38,358,701 41,086,457 Columbia 16,205,325 43,622,843 Maryland-Baltimore 2,044,121,827 2,892,638,534 Frederick 10,923,323 12,114,118 Hagerstown D. of C.-Washington 618,459,713 956,807,113 Total (9 cities) -81.0 427,694,713 171,715,288 1,198,811,102 2,688.483.712 112,844,591 56.220,343 113,724.379 1,002,493,423 260.039,000 237,515,432 1,332,515,451 100,138,512 88,435.870 92.801,751 96.292,358 51,217,929 21,788,666 3.055,799.395 408.846,266 169,432,729 1.126,611,577 3.055,832.656 109.335.360 55,878.556 98,414.790 1,505,427.663 632.867.020 414,418.178 1,337.643,645 109,203,325 85,733,107 104,220,743 88.596.211 47,121,300 21,823,478 3.084.716.952 Seventh Federal Reserv c District-Ch eagoMichigan-Adrian 12,851,871 5,434,981 -76.5 13,944.164 d1,276,401 8,180,171 14,764,327 14.494,728 10,745,160 Ann Arbor 59,356,150 30,322,779 --20.6 50.768.694 24,070,384 41,590,133 54,821,896 55,414,307 46.278,924 Detroit 1,940,556,328 3,236,378,646 -40.0 6.167,174,197 8,440,151,513 11,558,165,403 10,433,524.569 8,770,133.565 8,813.261.202 Flint 150,681,429 61,650,930 -42.3 203.851,522 35,568,536 108,036,196 220,442,316 180,332,538 145,865,362 Grand Rapids 431.880.060 142,258,285 --58.1 59,634,435 446,963,469 226,598,530 388.723,194 412.852,920 287,853,084 Jackson 92.141.380 25,038,273 +19.6 39,554,042 95,234,799 29,940,973 105,172,135 110,562.917 57.646,083 Lansing 61,996,273 --59.0 142.451.107 145,420,362 25,415,367 203,161,895 166.323.466 142.867.854 175.838,800 Indiana-Fort Wayne 52,982,771 --53.0 153,161,060 24,876,368 105,873,979 209.224.323 175,910,705 158,338,950 166,730.598 Gary 77,977,081 --3.4 322.544.570 174,387,000 298.790,097 309,886.459 75,338,664 296.543,662 253,971,064 Indianapolis 629,724,858 --22.1 490,245,000 852,191.683 1,092,108,000 1.286.073.000 1,207,652.198 1,207,528,916 1,191,869,000 South Bend 59,069,090 --52.3 162,609,400 28,182,478 88,575,408 163,442.166 166,260,154 160.969,629 135,223.195 Terre Haute 159,418,789 --3.2 154,284,709 217,980,321 310.964,697 282,846,687 277,537,067 300,965.151 263,191,437 Wisconsin-Madison 50,010,133 -66.0 119,292,200 186.137,234 18,989,538 161.114,961 186,048,289 186,297,553 136,958,500 Milwaukee 773,558,234 --27.4 561,860,976 1,156,635,380 1.487,453,843 1,825,350.991 2,158,202,569 2.246.371.313 2,200.177.699 20,914,981 --51.0 Oshkosh 31,488,526 10,243,866 49,445,900 53.045,295 49,605,198 51.943,192 40,009.150 tows-Cedar Rapids 35,846.030 --37.7 139,254.664 119,839,034 22,326,253 153,225,584 166,327,972 158,788,202 147,406,458 229,848,922 --89.2 Davenport e24,796,932 543.981,296 516,676.842 672,066.653 620.897.859 538,435.921 637.723.686 257,947,159 --7.5 Des Moines 238,540,178 335.156,684 546.115,415 527.409,513 507,721,340 439.220,462 515.292.642 b b Iowa City b 26,207,664 25.775,238 24,256,693 25.545.078 25.934,934 119,261,277 --16.4 99,751,460 202,166,116 Sioux C,,Ity 360.969,498 336.873.140 298,998.273 362,277.589 324.686,291 b b b Waterloo 37,553,768 83,909.006 74.148.880 65.414.012 66.654.559 71,518,177 15,873,582 --49.3 41,727,767 8,048,138 70.444,245 88.742.508 Ulinois-Aurora 66,784.797 82,120.290 53.739.239 49,497,539 --62.7 74,452,752 Bloomington 18,442,635 96.829,609 84.152,299 84,849,481 92.540.349 103,365,518 9,611,744,417 10,936,884,811 --.12.1 19,201.221,287 28,707,627,136 36,713,580,962 37.842.393,658 35,958,215.634 34,907,132.946 Chicago 27,132,821 --18.0 22,246,355 45,262,258 Decatur 66.854,298 69,391,689 70.376,309 69,799,500 62,009.970 116,547,216 --9.8 Peoria 105,109,257 158,019,046 309,660.998 284,704,052 253,540,410 262,806,045 233,987,210 34,675,720 --21.0 27,411,143 Rockford 94.715,140 205,308.336 189,231,847 180.484.298 170,363,037 156,682.125 81,364,465 --47.7 42,517,374 144.937.325 Springfield 111,633.366 133,250.054 143,425,697 136.403.765 147.894,237 Total (27 cities) Eighth Federal Reserve Indiana-Evansville New Albany Missouri-St. Louis Kentucky-Louisville Owensboro Paducah Tennessee-Memphis Arkansas-Little Rock 1111nols-Jacksonville Quincy Total (7 cities) 13,677,091,912 17,255,769,616 -20.7 30.448,706,642 43,810,366,289 56,270,138,889 56,385,204,739 52,677.335.684 51,641.391.122 District-St,L ouisb b 4,957,063 (700,907 2,897,125,979 3,069,950,302 911,287,760 915,949,001 b b 65,711,500 d29,040,978 550,523,885 600,085,325 a a 5,174,675 • 1,734,200 27,717,577 13,807,996 1.458,444,386 4.635,322,762 b -85.9 -5.6 +0.5 b -55.8 +9.0 a -66.5 -50.2 -3.8 11.776.615 4.587,620,932 1,134.398,884 63,876,121 660.399,481 a 7.603.049 40.480,301 6.506,155,423 241,354,305 8,854,206 6.146.332,080 1.850.136,498 20.386,427 104,085,592 954,000.029 a 10.567,352 60.986,238 277,018,070 9.538,727 7,278.217.025 1,940,887,905 21,782.580 129.177,974 1,239,779.882 791,641,157 20.773,724 78,402.412 260.206,749 9,164.551 7.566.304,781 1,936.030.886 20,564,267 121.009,800 1.172.927,187 748,244,471 18,994.907 79.547.231 305,203,072 9,822,606 7,387,457,173 1,879,529,149 19.692,702 117,795,779 1.191,854.410 740.952.228 19.932.176 84.774.575 280.656,764 9.789.770 7,631.792.498 1.781.961.052 19,749,879 112.093,719 1.196.581,429 754.627.362 21.557.265 85.897.544 9.396.706,727 11.787.219.456 11.932.994.630 11.757,013.950 11.894,757.283 Financial Chronicle 392 Jan. 20 1934 BANK CLEARINGS IN DETAIL FOR THE LAST EIGHT CALENDAR YEARS ACCORDING TO FEDERAL RESERVE DISTRICTS-(Concluded). Year 1933. Inc. or Dec. Year 1932. Year 1931. S Year 1930. Year 1929. Year 1928. Year 1927. 5 $ $ $ Year 1928. i 205.222,340 3,172.021,285 16,116,042 1,016.105,672 98,629,575 72,206,000 14,096,306 40,694,983 77,531,404 26.844,486 40,200,012 129,487.579 3,119,445 279,895,777 4,016,265,425 28.948.330 1,200.088.456 102,983.785 83.571.000 20.082.098 53,202,133 99,433,856 33.136,648 54.660.708 158.239.335 4,736.821 390,823,396 4,705,231,843 32,731,386 1.437,575.407 109,463,285 96,786.000 25.842,392 63,504,526 99,565,044 38,736,025 72,724,161 188,049,416 7,749,743 439.673.409 4,419,614,371 33.204,246 1,626,311,125 103,492,356 72,127,000 22,749,082 72.551,959 86,345,219 38,765,611 69,659.550 184,725,683 9.555.476 465,061.789 4.094,562,453 32.123.424 1,556.483,398 110,360,797 72,139,000 17,801.540 66,757,056 82.668,196 34.521.615 55.408.877 163.967,351 9,216.006 414.865,676 4,110,311,738 28.236,650 1,617,454.198 97,024.377 70.908,000 15,705,910 76.436,736 79,223,998 32.104,577 47,337.663 166,861,271 9,035,033 +0.9 4,912,275,129 6,135,244,372 7.268,782,624 7,178,775,087 6,751,071,502 6,765,505.827 Tenth Federal Reserve District-Kan sas City3,034,341 7,986,310 -62.0 Nebraska-Fremont f950,000 7,124,156-86.7 Hastings 94,300,761 -11.7 83,310,389 Lincoln 996,877,087 1,102,436,600 -9.6 Omaha 87,338,172 -28.4 Kansas-Kansas City 62,554,100 88,550,152 -13.0 77,066,598 Topeka 201,101,302 -46.5 107,650,617 Wichita 16,061,956 -5.7 15,146,583 Missouri-Joblin 2,864,297,991 3,185,864,846 -10.1 Kansas City 133,442,013 -3.8 128,383,305 St. Joseph a a a Oklahoma-McAlester a a a Oklahoma City 229,531,857 -10.3 205,959,201 Tulsa 25,341,584 34,377,505 -26.3 Colorado-Colorado Springs 960,057,247 -10.3 861,523,862 Denver 36,266,412 -27.7 26,218,469 Pueblo 12,977,782 16,382,735 147.152,318 1,724,857,290 119,217,029 134.079,333 258,977,982 25,247,753 4.399,861,852 203,405,836 a a 304,545,105 51,016.097 1.295,070,787 62,042,178 18.296,319 26.305,091 175.817.374 2,183.257.401 109.882,111 170.679.470 366,334.805 47.687,133 6.302,246,728 289.851.742 a a 487.606,641 61,740,658 1,694,207.214 79.301,193 19.871,632 30.058.874 208.468,855 2,397,776,990 114,549,255 188.162,771 440,147.018 70,482.268 7,451.137,423 361.895,823 a 1,646,089,362 636,799,100 74,753.629 1,861.410,591 90,836.614 20.851,129 28.820.191 246.146,704 2.311,920,165 109,011,087 193,908,504 480.707.432 70.680,927 7,254.046.094 364,887,906 a 1,568,022,225 630,886,313 70,177.437 1,863.583.891 77.153,861 20.856,808 24.570,478 254.013,059 2,102,408,685 121.216.030 172,613,529 424.562,352 81.691,204 7,245.050,814 337.727.941 a 1,555,022,855 596.642.699 84.167.032 1,732,674.525 89.302,494 19,738.367 28.008,329 245,980.286 2,103,548,186 213.374,463 179.146.598 435.778.140 93.584,411 7.301.562,157 375,642,241 10.281.364 1,526.008,448 527,417.855 61,750.994 1,688,644.834 63.275.613 Total (13 cities) Total (14 cities) 3,725,343.941 5,458,314,127 3,693,211,987 Gi e.2 1,1b b0 ;A.;P:A•ia $ $ Ninth Federal Reserve D1Strict-Min neapolis130,713,267 124,249,575 Minnesota-Duluth 2,518,077,098 2,437,597,703 Minneapolis 11,796,474 8.749,470 Rochester 759,852,909 768,083,755 St. Paul 74,492,933 86,620,147 North Dakota-Fargo 37,089,000 52,052,000 Grand Forks 6,680,285 8.930,5971 Minot 29,701,8491 23,375,717 South Dakota-Aberdeen _ _ 40,379,6801 39,216,329 Sioux Falls 14.455,233 16,863,1421 Montana-Billings 18,653,217 25,693,563 Great Falls 92,093,077 89,079,362 Helena 1,895,406 2,164.140 Lewistown 14_1111111114_4. •-• • tv •-• t•Z • • c, Clearings at- 6,184,439,289 -11.7 8,754.834,077 12.011,213,880 15,592,440,205 15,290,803.666 14,802,520,305 14,873,742,285 Eleventh Federal Reser, e District-Da Has41.840,979 35,460,095 Texas-Austin 39,415,845 28,911,392 Beaumont 1,401,169,882 1,381,360,860 Dallas 108,065,512 122.988,459 El Paso 278,396,143 241,650,309 Fort Worth 100,828,000 119,756,000 Galveston 1,051,135,777 1,008.516,606 Houston 11,889,995 12,726,905 Port Arthur a a Texarkana 25,922,548 27,723.000 Wichita Falls 117,848,311 96,808,975 Louisiana-Shreveport -15.3 -26.7 +1.4 -12.1 -13.2 -15.8 +4.2 -6.6 a -6.5 -17.9 74.429,043 75,506.339 1,803,330,859 207,711,013 380,876.507 132,167,000 1,385,063,619 23,383,175 a 52,992,000 170,470.477 76,981,831 96.974.276 2,122,364.049 298.613,604 520.252.889 179.440.290 1,676.248.710 35,361,870 a 100.312.041 237,800.692 97.763.410 113,183,692 2,881,787,579 324,538.201 744,516,447 284,292.000 2,008.863.851 42,640,553 33,302.527 130.005,246 290,465,691 94,312.924 103,414,000 2,783.610.484 295,164,967 729,207.147 308,486,000 1,825.696,257 29,243,695 33.372.049 133,219,435 297,809.785 84.936,476 102.736,000 2.651.392,000 254,780.035 656,641,904 440.218,000 1,872.575.124 32,202.812 34,385,522 146,825,000 281,789,584 85.870,973 87.755,313 2,618,137,647 252.853,538 743.352.678 598.903,000 1,881,077,054 29,893,340 37.614,237 182.772,225 279.361,853 3,150,573,108 -1.5 4,305.930,032 5,344.350,252 6,951,359,197 6.633.536.743 6,558.572,517 6,812,696,906 -19.1 -18.9 -6.3 -25.8 -28.0 -25.6 -5.4 -4.4 -6.1 a -22.0 -6.0 -8.2 a -11.5 33,466,194 1,563,461,845 466,630.000 42,897.787 67.407.994 15,124,000 1,384,174,312 48,712,606 715,077,670 a 156,930,482 48,426.908 200,954,406 a 272,436,183 50,040,884 47.274.000 42.524,000 46.641,000 1,997.926,280 2,653.702,788 2,542,920.892 2,366.923.226 704,091,000 569.737.000 677,345.000 663,295.000 60,000,038 81.862,225 87,403,918 77,903,882 72.789,413 67,270,426 75.070,229 63,271,668 21.303,239 25.408,725 26.603,724 26.000,750 1,769,799,112 2.074,370.046 1.985,688.152 1978.932,067 82,968,375 97,404.763 95.237,940 86,612,536 953.583,888 917.786,774 1,035.216.759 924,051,647 a a • 35,368,955 199.040.000 196.964.000 243,368.000 153,160,900 69,675,323 87.256,303 75.984.675 67,109,144 255,711.123 264,618,148 232.253.785 263,145,486 202,467.913 234.749.359 a 227,342,851 455.777.616 427.047.254 365,062,994 369,056,937 10,066,695,000 10,825,705,000 9,381,948,000 a 49.969.110 59,977,580 50,561,882 45,510.934 1,020,614,221 1,046,040,933 a 969.103.648 364.472.854 359,077.275 293.876.641 350.763.565 60.739.928 54,163,780 57.372.651 49.565.876 387,204,230 394.181.830 400,244,548 354,648,306 292,706,408 326.932.602 301,403.758 276,387.907 9,558,593.667 10,038,051,445 11,491,219.372 10,117.987.269 174.259,282 190.592,939 148.888.528 157.352,616 106,813,576 92,052.377 78.281,207 104,427,920 104.376.297 113,842.117 102,745,953 113.320,549 a 27.024.331 27.204.797 26.217,243 135,736,100 135.379.700 141.554.400 108,272,700 48.055,000 2.352.953,405 644,971,000 78.171.284 59,201,417 28,038,489 2,103.840,202 .83,084,609 922,163,600 35,923,678 135.689,000 66,884.028 232.803,013 231.399.177 367.054.556 8,917.424,000 46,203,317 1.077.033.672 334,578,791 52.790,322 442.501,119 315,225,056 9.799,768.682 158.055,183 76.943,863 119.396,676 26,406.238 146,867,700 Total (10 cities) 3,101,842,485 Twelfth Federal Keene District-San Francisco16,740,353 20,692,540 Washington-Bellingham 1,141,237,255 924,977.931 Seattle 267,299,000 285,351,000 Spokane 16,999,958 22,006,861 Yakima 30,284,099 42,037,589 Idaho-Boise 6,812,575 5,071,000 Oregon-Eugene 847,349,215 895,782,665 Portland 23,353,759 24,428.708 Utah-Ogden 460,012,259 489,682,538 Salt Lake City a a Nevada-Reno 99,607,989 77,699,146 Arizona-Phoenix 33,651,727 35,791,607 California-Bakersfield __ 162,840,991 149,560.432 Berkeley a Fresno a 156,230,105 138,258,182 Long Beach a a Los Angeles 20,572,371 19,130,473 Modesto a a Oakland 160,692,209 128.143,815 Pasadena 30,878,662 37,658,984 Riverside 165,144,325 323,537,317 Sacramento a San Diego a 4,684,614.157 5,053,860,846 San Francisco 83,484,854 75,193,514 San Jose 45,948,070 56,237,798 Santa Barbara 40,305,926 46,204,011 Banta Monica a a Santa Rosa 51.649,952 60,161,524 Stockton Total (22 cities) 8,232,265,755 9,225,812,317 -10.8 13,341,600,916 17,482,397,665 31,827.014,769 32,717,053.551 29,472,714.999 28.903.424,957 Grand total (172 ankle) 241,454,844,300 256,634,294,429 Outside New York -7.0 aa 30,577,718 a a -20.3 240,082,809 -18.0 41,590,830 -49.0 389,910,876 a a -7.3 7,142,159,353 -9.9 132.151,816 -18.3 86.054,117 -12.8 82,058,604 a a -14.1 81,320,606 -5.9 409,568,489,920 542,243,060,904 726.884.632.647 633.872.155.470 555.109.075,670 523,773,772,455 84.040.850.549 96.495.830.646 -12.9 146.298.005 962 195 132 522 754 240 542 San 488 242 144 870 2na 222 574 8(12 non 922 415 595 0./9 CANADIAN BANK CLEARINGS FOR THE LAST EIGHT CALENDAR YEARS. Clearings at- $ 3,970,526,109 4,072,710,628 1,970,176,565 636,113,008 227,999,783 210,822,180 115,174,903 190,818,350 258,189,363 85,895,057 70,573,098 127,363,404 194,556,920 177,159,334 17,380,404 17,284,264 73,352,974 28,606,507 39,549,377 28,973.994 23,365,498 9,589,500 30,217,665 28,246,454 43,767,026 117,006,345 14,343,182 35,940,771 27,468,131 22,190,244 20,037,081 24,215,294 ++11 8 4,249,531,044 4,916,531,044 2,807,734,669 667,955.703 196,686,200 191,774,625 100,859,484 175,111,440 256,392.620 74,776,201 69,300,609 116,906,848 173,437,240 170,858,650 14,533,360 17,301,733 59,500,614 25,548,000 36.878,757 26,551,154 21,278,151 9,819,336 27,848,985 27,452,935 43,365,053 106,323,870 12,108,245 31,567,841 25,953,786 21,461,353 18,781,336 26,470,130 Inc. or Dec. t••• NOno•e!ev •-• 00 00 Cz. •-• N et CI CO . . • •CO•.1. • • • •e4 • ITCi .:6,,i.ic.i.No6Ocsi....c9c>moc"',52,T°P9""rliCitOtilOtOli + Total(32 cities) Year 1932. t Montreal Toronto Winnipeg Vancouver Ottawa Quebec Halifax Hamilton Calgary St. John Victoria London Edmonton Regina Brandon Lethbridge Saskatoon Moose Jaw Brantford Fort William New Westminster Medicine Hat Peterborough 5nernrooke Kitchener Windsor Prince Albert Moncton Kingston Chatham Sarnia Sudbury Year 1933. Year 1931. S 5,773,473,678 5,134,895,419 2,253.265,542 815,227,626 323,349,843 285,395,664 150,986,611 247,414,617 319,979,949 115,510.903 95,261,089 145,511,214 231,243,017 193,486,878 21.015.875 20,813,263 89,784,763 38,151,255 48.891,243 34,737,532 31,111,821 12.319,717 38,026,819 37,092,629 5.3,174,366 149,917,403 19,749,372 38,911,582 35,591,744 27,278,588 25,489,520 36,319,005 Year 1930. $ 6,917,957,798 6,036,838,536 2,517,469,597 914,132.520 372,586,710 339.596.344 174.720,945 310,976.401 451.865,100 124.234.187 125,903.653 168,006,976 296.550,901 252,801.214 26,763,125 29.064.091 117,776.087 59.359.874 58.149.011 43.514,483 43.641,532 17.302.533 47,057.616 45.958,555 63,411,042 214.689.007 22,887.312 51,039.289 44.029,368 32,213,088 36,485.041 57,857.754 Year 1929. $ 8.279.414,820 7,721,361.164 3.393,339.677 1.243,625.652 443,895.304 375,097,862 197.539,725 3.50.821,242 697.716,733 151.865,016 151.226.015 183,916.716 358.982.727 341.917.650 35.403.096 38.807,465 146.732,755 72.492,575 76.811.637 52,807,241 52,236.137 26,445.424 51,283,226 54,664,850 71.102.678 303.189,777 27.389.870 53,623,914 46,678,714 41,710.000 42,932,463 Year 1928. $ 8,072.843.473 7.674.586.731 3,443.151,987 1,100,937,564 431,183,371 361,754.092 185,679,424 337,854,407 666.517,374 150,693.371 134.095.845 180,871.381 351,324.768 312.089.792 38,728,824 40.772,004 138.787.497 73,510,635 72.529,308 59,588,922 44.774,994 26,802,962 49,138.361 50,623,174 66,300,152 280,032,888 25.131,848 49,386,221 46,174,083 43,568,049 37,854,684 Year 1927. $ 6,771,872,659 6,484.588.731 2,704.527.877 924.784.859 374,560.769 349,324,234 183.572.908 296,400.645 436,380.336 134,755,457 117.462.545 167,784.864 286.552.842 259.733.292 31.888.338 31,878,544 109,929.060 69,803.412 63.699,387 51,979,079 42,108,115 18.017,757 45,621,253 47,448,683 60,999.516 243,913.681 20,755,563 45.899,119 42,541,149 41,681,478 35,936.684 Year 1920. $ 5,646,347.421 5,106,428.183 2,708,415.764 888,764,118 338.607.358 319,659.404 150.800.492 268.402.609 393,910,637 136.226,527 110,885.953 142,856,910 259,611,119 240.953,818 31,005,956 29,565,732 103.237.697 64,190,200 55.117,564 48,102,058 39,253,110 15,462,521 41,385,282 44.259.492 51.757.433 219 129.742 20,193,984 44,207,861. 38.282,486 14,720,601,016 12,909,613,409 +14.0 18.843.377,545 20,094,909,690 25.085,039125 24.556.298.549 20.566.490.886 17.645 sliii.411 •Now refuses to report clearings. b Clearing HOUBS not functioning at present. c Six months' figures. d Eight months'figures. e Three months' figures. months'figures. n No clearings reported since June, there having been only one bank open since that time. t Two Financial Chronicle Volume 138 The Course of the Bond Market. 393 The development of greatest importance to the security markets this week was the President's message to Congress on Monday, advocating that the Treasury take over the monetary gold stock now held by the Federal Reserve banks and that $2,000,000,000 of the so-called profit on the gold be used as an equalization fund to keep the dollar between 50 and 60 cents. The proposal implied also that the fund might be used to support the Government bond market. The security markets responded with wide advances in all classes of issues. Bonds extended the gains which have been made in the past several weeks, the general averages now being not far from the July 1933 high level. Utility issues were particularly strong, with railroads a close second. The Reconstruction Finance Corporation buying price for gold was advanced to $34.45 per ounce on Tuesday, from $34.06, giving the dollar a theoretical gold value of 60 cents. In terms of French franc quotations, however, the dollar averaged a fraction ow r 62 cents all week, compared to 64 cents last week. Announcement of the President's policy was met with a downward trend for the dollar at first; later it rallied, due to the tendency of funds to return to this country now that a certain amount of stabilization is to be assured in the management of the currency. United Ste tes Government bonds, as well as high grade corporate issues, were stronger this week. The Treasury has no important maturities to take care of, aside from the usual weekly issues, until March 15, but in view of the rapidiy declining Treasury cash balance a new large offering is to be expected soon. All classes of railroad bonds showed great strength. High grade, medium grade, low grade and also defaulted issues were in demand. Generally greater optimism, more favorable monetary developments and favorable traffic reports all contributed to the muket strength displayed. Gains of as much as five points were numerous and in certain cases the advances for the week were even larger. High grade bonds sold close to the best levels in years. Atchison Topeka & Santa Fe general 4s, 1995, at 963/8, were within a fraction of the 1933-34 high price. Union Pacific 1st 4s, 1947,at 102 made a new 1933-34 high. Chicago Milwaukee St. Paul & Pacific 5s, 1975, advanced from 43 to 493 t for the week, Chicago & North Western 4%, 1949, from 33% to 39; New York Central 4s, 1934, from 873.i to 943.'; New York New Haven & Hartford 6s, 1948, from 76 to 863/2, and Southern Pacific 4 1968, from 60 to 663/2. Denver _& Rio Grande Western issues were highly erratic, reflecting uncertainty regarding interest payments, on the one hand, and optimism over earnings prospects, on the other. Advances in utility bonds continued unabated until Thursday when a breathing spell occurred. In the earlier days of the week very few issues were neglected in the upward surge of prices and second grade and speculative bonds as a class staged rather a remarkable recovery. Obligations of companies affected by the Tennessee Valley Authority were in particular demand. High grades acted well. Indianapolis Power & Light 5s, 1957 are up 29/i points for the week, to 82%;Gulf States Utilities 5s, 1956, up 334 to 76; Continental Gas and Electric 5s, 1958, up 3% to 46 8, and National Power and Light 6s, 2026 up 43.4 to 67. Heavy institutional purchases continued to push industrial bond prices ahead this week. Strength was general, with such of the highest grade issues as Liggett & Myers 5s, 1951, up 33 4 to 1093 4, approaching their 1933 highs. Steels held past gains and extended these in some cases, Republic Iron 4 points to 823 4. Movie & Steel 53.4s, 1953, advancing 53 bonds continued strong, with the various Paramount issues reaching new high ground on the move due to reorganization rumors. U. S. Rubber 5s, 1947 were again a feature among tire and rubber issues, scoring a 4 point gain to 733.4. United Drug 5s, 1953, were up 9 points to 7434, crossing their 1933 high of 713.4. The foreign bond market as a whole was fairly strong this week. Outstanding developments were represented by a substantial come-back in Cuban bonds, particularly the 534s of 1945. Argentine, Brazilian and Japanese bonds were fairly strong. German bonds as a group were somewhat irregular, with strength evidenced by most municipal issues, while the trend of corporate bonds was mixed. Danish, Finnish and Norwegian issues were fairly steady. Royal Dutch, Batavian Petroleum and City of Rotterdam bonds experienced some price reaction, while the Free State of Ireland bonds also declined somewhat in price. Austrian issues, particularly the Tyrol Hydro-Electric issues, showed fair gains. The municipal bond market showed some signs of strength this week. Second grade issues were active, with Detroit obligations up several points. Moody's computed bond prices and bond yield aye'ages are given in the following tables: MOODY'S BOND PRICES.* (Based on Average Yields.) MOODY'S BOND YIELD AVERAGES.t (Based on Industrial closing Prices.) AU U.S. 1934 120 Gov. 120 Domestics by Ratings.* Daily Bonds. Domesvs. Averages. Acta. tic. Aa. Baa. A. Jan. 19-- 100.36 18_ 100.38 17-- 100.39 16-- 100.39 15__ 100.09 13__ 99.69 12._ 99.71 11__ 99.42 10__ 99.06 99.49 99.88 100.09 100.42 100.59 100.58 100.32 High 1933 103.82 Low 1933 98.20 High 1932 103.17 Low 1932 89.27 Yr. AgoJan.19'33 102.95 2 Yrs.Ago Jan.19'32 91.32 90.55 90.00 89.45 89.31 88.77 87.83 87.69 86.91 85.74 85.23 84.97 84.85 84.85 84.85 85.10 85.10 92.39 74.15 82.62 57.57 107.67 97.16 107.31 97.16 100.96 96.70 10(1.78 96.23 106.60 95.78 106.60 95.63 106.25 95.48 105.89 94.88 105.72 94.29 105.54 93.99 105.37 93.85 105.37 93.40 105.37 93.26 105.54 93.11 105.54 93.55 105.37 93.55 108.03 100.33 97.47 82.99 103.99 89.72 85.61 71.38 82.87 105.03 91.53 120 Domes fe by Groups. RR. P. U. Indus. 87.96 87.43 86.91 86.77 86.51 85.10 84.85 84.35 83.11 82.50 82.02 82.02 82.02 81.90 81.78 81.90 89.31 71.87 79.55 54.43 74.36 73.45 72.95 73.05 71.96 70.33 70.52 69.31 67.42 66.64 66.38 66.47 66.55 66.64 66.90 67.07 77.66 53.16 67.86 37.94 91.39 90.83 90.27 89.86 89.17 88.36 88.36 87.56 86.64 85.99 85.61 85.61 85.74 85.87 88.25 86.12 93.26 69.59 78.99 47.58 82.38 81.78 81.30 81.30 80.37 78.66 78.44 77.00 75.19 74.46 74.36 74.25 74.25 74.46 74.57 74.88 89.31 70.05 87.69 65.71 98.73 98.57 98.25 98.09 98.09 97.94 98.09 98.25 97.78 97.62 97.31 97.16 97.00 96.54 96.54 96.54 99.04 78.44 85.61 62.09 80.84 63.19 74.98 88.10 86.64 AU 120 Domestics by Ratings. 1934 120 Daily DomesBaa. Acta. Aa. A. Averages. tie. Jan. 19__ 18__ 17._ 16__ 15__ 13__ 12._ 11.... 10__ 9_ 8..6._ 5._ 4-3-2... Low 1933 High 1933 Low 1932 High 1932 Yr. . AgoJan.19'33 2 Yrs.Ago Jan.19'32 120 Domestics by Groups. RR. ft 30 ForP. U. Indus. dons. 5.38 5.42 5.46 5.47 5.51 5.58 5.59 5.65 5.74 5.78 5.80 5.81 5.81 5.81 5.79 5.79 5.25 6.75 5.90 8.74 4.30 4.32 4.34 4.35 4.36 4.36 4.38 4.40 4.41 4.42 4.43 4.43 4.43 4.42 4.42 4.43 4.28 4.91 4.51 5.75 4.93 4.93 4.96 4.99 5.02 5.03 5.04 5.08 5.12 5.14 5.15 5.18 5.19 5.20 5.17 5.17 4.73 5.96 5.44 7.03 5.57 5.61 5.65 5.66 5.68 5.79 5.81 5.85 5.95 6.00 6.04 6.04 6.04 6.05 6.06 6.05 5.47 8.98 6.34 9.23 6.73 6.82 6.87 6.86 6.97 7.14 7.12 7.25 7.46 7.55 7.58 7.57 7.56 7.55 7.52 7.50 6.42 9.44 7.41 12.96 5.32 5.36 5.40 5.43 5.48 5.54 5.54 5.60 5.67 5.72 5.75 5.75 5.74 5.73 5.70 5.71 5.19 7.22 6.30 10.49 6.01 6.06 6.10 6.10 6.18 6.33 6.35 6.48 6.65 6.72 6.73 6.74 6.74 6.72 6.71 6.68 5.47 7.17 .5.59 7.66 4.83 4.84 4.86 4.87 4.87 4.88 4.87 4.86 4.89 4.90 4.92 4.93 4.94 4.97 4.97 4.97 4.81 6.35 5.75 8.11 8.05 8.11 8.14 8.22 8.25 8.33 8.33 8.32 8.39 8.46 8.53 8.56 8.55 8.61 8.60 8.65 8.63 11.19 9.86 15.83 5.97 4.45 5.31 6.14 7.97 6.67 5.56 5.67 9.93 93.70 82.99 72.55 55.99 71.09 80.95 71.09 7.06 13.42 6.75 5.16 5.96 6.91 8.98 7.06 6.13 Notes --* These prices are computed from average yield on the basis of one "Ideal" bond 43(% coupon, maturing In 31 years) and do not purport to show either the average level or the average movement of actual price quotations. They merely serve to II ustrate n a more comprehensive way the relative levels and the relative movement of yield averages, the latter being the truer picture of the bond market. t The latest complete list or bonds used in computing these Indexes was published in the "Chronicle" of Sept. 9 1933, page 1820. For Moody's Index of bond prices by months back to 1928, see the "Chronicle" of Feb.6 1932, page 907. .• Average price of 8 long-term Treasury issues. ft Average 01 30 foreign bonds but adjusted to a comparable basis with previous averages 01 40 foreign bonds. 74.15 Indications of Business Activity THE STATE OF TRADE-COMMERCIAL EPITOME. Friday Night, Jan. 19 1934. The movement ahead of general trade was somewhat slower than in recent weeks, but prospects all point to a continuance of the forward movement. The volume of retail sales was well maintained and wholesale buying showed an increase. Steel production increased and so did carloadings and electric power production. The major industries all make a better showing than they did at this time last year. Retail sales of clothing and shoes were larger, and there was a good demand for hardware, electrical appliances, house-furnishings, rugs, table linens and glassware. Orders place dwith wholesalers showed a substantial increase. There was an increase in the number of buyers visiting leading markets and the orders sent in by road salesmen doubled those of last year in some lines. Commodity prices rallied sharply following the President's message to Congress on gold and currency, which would Financial Chronicle 394 establish a value of between 50 and 60 cents for the dollar and provide for the transfer of all gold now held by the Federal Reserve banks. Cotton advanced to the highest level seen since last July on good trade buying inspired by the President's monetary message. Trading was the most active in several months. Cotton goods were more active and stronger. There was a broader demand for all grades of gray and finished goods. There was also a better demand for heavy goods. Wool also met with a better inquiry. Grain markets were more active and prices rose sharply, with wheat showing a net rise of 43z cents for the week, corn cents, oats 1 to 19 cents and rye 23 to 2M to cents. Flour prices followed those of wheat upward but there was no improvement in the demand. Lambs were higher in price, while steers and hogs declined. Receipts of all classes of livestock at leading markets were larger. Sugar prices were more active and higher on a better demand inspired by the President's special message to Congress on gold and currency, and reports that this country was willing to discuss sugar stabilization with other countries. Hides were rather quiet, but prices recently were higher. Sales of leather were rather large, but no price changes of consequence were reported. Rubber advanced with other commodities during the week in a broader trade prompted by the new monetary policy, the advance in the gold price and more favorable restriction news. Other commodities which show advances for the week were bellies, lard, butter, cheese, coffee, eggs and lambs. Raw sugar, steers, and hogs showed declines. The weather over the last week-end continued mild, although after that temperatures dropped rapidly until Friday when they rose somewhat. The New England States were hit the early part of the week by snow storms that isolated smaller towns and cut off communications. A dispatch to the Associated Press on Jan. 14 from Burlington, Vt., said that northern New England lay under a heavy carpet of snow, isolating outlying districts, dissupting communications and causing damage to trees. The report also stated that several points reported record falls, the Burlington Government weather station reporting 24.7 inches of snow in 12 hours, establishing a record. The nearest approach to this mark was in 1919, when 16 inches fell. Another report the following day from Lubec, Me., told of traffic arteries plugged with snow six to nine feet deep. To-day it was 29 to 43 degrees here and fair. The'forecast was for fair and colder. Overnight at Boston it was 14 to 30 degrees; Baltimore, 30 to 36; Pittsburgh, Pa., 34 to 42; Portland, Me., 6 to 16; Chicago, 24 to 44; Cincinnati, 34 to 48; Cleveland, 28 to 42; Detroit, 22 to 38; Charleston, 46 to 58; Milwaukee, 18 to 44; Dallas, 50 to 56; Savannah, 46 to 66; Kansas City, Mo.,26 to 54; Springfield, Mo., 38 to 60; St. Louis, 32 to 56; Oklahoma City, 42 to 64; Denver, 28 to 48; Salt Lake City, 28 to 44; Los Angeles, 52 to 76; San Francisco, 42 to 50; Seattle, 42 to 48; Montreal, 2 below to 6 below zero, and Winnipeg, 6 to 24. ,Tan. 20 1934 The first 16 major railroads to report for the week ended Jan. 13 1934 loaded 240,064 cars of revenue freight on their own lines during that period, compared with 214,455 cars in the preceding week and 224,386 cars in the week ended Jan. 14 1933. With the exception of the Atchison Topeka & Santa Fe Ry., the Gulf Coast Lines and the Wabash Ry., all of these carriers showed increases over the corresponding period last year. Comparative statistics follow: REVENUE FREIGHT LOADED AND RECEIVED FROM CONNECTIONS. (Number ot Cars.) Loaded on Lines. Reed from Connections. Week Ended. Jan. 13 Jan. 6 Jan. 14 Jan. 13 Jan.6 Jan. 14 1934. 1934. 1933. 1934. 1934. 1933. Atch. Topeka & Santa Fe 113,-- -Chesapeake & Ohio Ry Chic. Burlington & Quincy RR_ Chic. Milw. St. Paul & Pacific Ry Chicago & North Western By Gulf Coast Lines & subsidiaries_ _ International Great Northern RR Missouri-Kansas-Texas Lines_ Missouri Pacific RR New York Central Lines New York Chic. dr St. Louis Ry_ Norfolk & Western By Pennsylvania RR. System Pere Marquette By Southern Pacific Lines Wabash By 16,880 20,860 13,931 17,290 13,553 2,315 2,256 4,411 12,705 37,881 3,517 15,616 51,986 4,520 17,742 4,601 14,923 17,982 12,140 15,343 11,645 2,014 1,987 3,913 11,518 33,675 3,293 14,347 48,324 3,610 15,734 3,977 18,216 4,153 4,034 3.269 19,265 6,114 6,013 5,486 12,825 5,352 5,433 4,350 15,100 5,977 5,773 4,965 11,777 8,490 8,104 6,283 2,610 1,213 1,182 938 2,084 1,729 1,412 1,686 1,979 4,373 2,508 2,501 12,562 7,020 7,070 5,837 35,615 54,923 53,947 46,756 3,369 7,928 7,872 6,714 13,926 3,172 2,568 3,185 47,727 29,941 28,539 27,440 4,003 16,099 a ,351 5,996 4,835 6,883 61 240.064 214,455 224,386 145,403 140,799 124,884 Total a Not available. TOTAL LOADINGS AND RECEIPTS FROM CONNECTIONS. (Number of Cars.) Weeks Ended. Jan. 13 1934. Jan.6 1934. Jan. 14 1933. Chicago Rock Island & Pacific Ry_ Illinois Central System St. Louis-San Francisco Ry 19,058 24,599 11,785 16,298 20,599 10,270 x 24,274 11,345 55,443 47,167 Total x Not available. Loading of revenue freight for the week ended on Jan. 6 totaled 499,939 cars, the American Railway Association announced on Jan. 12. This was an increase of 49,317 cars above the preceding week and 60,470 cars above the same week in 1933, but a decrease of 71,739 cars below the corresponding week in 1932. In making comparisons, however, consideration should be given to the fact that the week of Jan. 6 this year and the corresponding week in 1933 contained New Year's holiday, while the corresponding week in • 1932 did not. The week of Jan. 6 this year was, however, a reduction of 2,788 under the week that did include New Year's holiday in 1932. Details for the week ended Jan. 6 1934 follow: 127.5 122.8 80.5 103.9 79.3 148.9 78.7 Miscellaneous freight loading for the week of Jan 6 totaled 170,851 cars, an increase of 11,754 cars above the preceding week. and 28,713 cars above the corresponding week in 1933. It was, however, a reduction of 13.352 cars below the corresponding week in 1932. Loading of merchandise less than carload lot freight totaled 134,367 cars, an increase of 10,006 cars above the preceding week and 711 cars above the corresponding week in 1933, but 49,103 cars below the same week in 1932. Grain and grain products loading for the week totaled 23,389 cars, an increase of 3,064 cars above the preceding week, but 810 cars below the corresponding week in 1933 and 4,103 cars below the same week in 1932. In the Western districts alone grain and grain products loading for the week ended Jan.6 totaled 14,976 cars, a decrease of 84 cars below the same week in 1933. Forest products loading totaled 14.878 cars, an increase of 3,183 cars above the preceding week and 2,465 cars above the same week in 1933, but a decrease of 1,943 cars below the same week in 1932. Ore loading amounted to 2,826 cars, an increase of 748 cars above the preceding week and 1,587 cars above the correspordlng week in 1933, but a reduction of 368 cars undtr the corresponding wcek in 1932. Coal loading amounted to 130.373 cars, an Increase of 16,089 cars above the preceding week, 25,684 cars above the corresponding week in 1933 and 4,446 cars above the same week in 1932. Coke loading amounted to 7,627 cars, an increase of 527 cars above the Preceding week, 2,245 cars above the same week in 1933 and 1,622 cars above the same week in 1932. Live stock loading amounted to 15,628 cars, an increase of 3,946 cars above the preceding week, but 125 cars below the same week in 1933 and 8,938 cars below the same wcek in 1932. In the Western districts alone. loading of live stock for the week ended Jan.6 totaled 11,884 cars, a decrease of 126 cars compared with the same wtek in 1933. All districts reported increases for the week of Jan. 6 compared with the corresponding week in 1933, but all districts reported reductions compared with the corresponding week in 1932 except the Pocahontas. Loading of revenue freight in 1934 compared with the two previous years 'follows: 1934. 1933. 1932. 499,939 439,469 Week ended Jan. 6 671.678 Freight Loadings During Latest Week Up 8.9% Over the Same Period Last Year. Loadings of revenue freight for the week ended Jan. 13 1934 totaled 555,627 cars, an increase of 55,688 cars, or 11.1%, over the preceding week and 45,734 cars, or 8.9%, over the corresponding period last year. It was, however, a decrease of 17,022 cars, or 2.9%, below the corresponding week in 1932. Total loadings for the week ended Jan. 6 1934 were 13.8% in excess of those for the week ended Jan. 7 1933. In the following table we undertake to show also the loadings for the separate roads and systems for the week ended Jan. 6 1934. During this period a total of 102 roads showed increases over the corresponding week last year, the most important of which were the Pennsylvania System, the Baltimore & Ohio RR. the New York Central RR., the Chesapeake & Ohio Ry., the Norfolk & Western Ry., the Louisville & Nashville RR., the Southern Ry. System, the Union Pacific System, the Chicago Milwaukee St. Paul & Pacific Ry., the Chicago Burlington & quincy RR., the Missouri Pacific RR., the Southern Pacific Co. (Pacific Lines), the Chicago & North Western Ry., and the Reading Co. Moody's Daily Index of Staple Commodity Prices Continues Advance. Prices of the principal raw commodities moved up during the week in review, Moody's Daily Index of Staple Commodity Prices continuing its almost uninterrupted advance of the last four weeks and closing at 132.9, up 3.4 points for the week and at the highest level since Sept. 25. Eleven of the 15 commodities in the Index advanced; two, hogs and lead, were unchanged, and two others, corn and coffee, were each M-cent lower. Cotton and wheat were responsible for two-thirds of the advance, with rubber and copper next in importance; and hides, steel scrap, sugar, wool tops, silk, cocoa and silver following. Fri. Jan. 12 Sat. Jan. 13 Mon. Jan. 15 Tues. Jan. 16 Wed. Jan. 17 Thurs. Jan. 18 Fri. Jan. 19 Revenue 129.5 129.7 132.7 132.0 131.7 132.1 132.9 2 weeks ago. Jan. 15 Month ago, Dec. 19 Jan 19 Year ago, 1932 High, Sept. 6 Low, Dec. 31 1933 High, July 18 Low, Fee. 4 Financial Chronicle Volume 138 395 REVENUE FREIGHT LOADED AND RECEIVED FROM CONNECTIONS (NUMBER OF CARS)-WEEK ENDED JAN. 6. Total Loads Received from Connections. Total Revenue Freight Loaded. RMIrsads. 1934. Eastern District. Group ABangor & Aroostook Boston & Albany Boston & Maine Central Vermont Maine Central New York N. H.& Hartford. Rutland 1933. 1932. 1934. 1933. 1.961 2,750 6.298 828 2,351 9,223 447 1.350 2,314 5,865 461 2.089 7.993 449 2,007 3,242 7,977 559 2,555 11,449 525 265 4,546 9,882 2,084 2,643 11,201 905 219 3,647 7,283 1,760 1,808 8,764 724 • 23,858 20,521 28,314 31,526 24,205 Group BDelaware & Hudson Delaware Lackawanna & West • Erie • Lehigh & Hudson River Lehigh & New England Lehigh Valley . Montour . New York Central . New York Ontario & Western . Pittsburgh & Shawmut Pittsburgh Sluswmut& Nortlier 1 5,830 9,161 10,744 102 1,612 8.125 1,361 16,850 2,030 407 408 3,263 5,887 8,063 112 1,029 6.064 1,280 14,565 1,696 369 236 5,364 8,814 11,631 147 1,488 8,226 1,660 18,497 1,854 468 396 6,492 5,226 12.154 1.642 912 6,113 14 25,971 2,288 32 189 4,530 3,728 9,646 1,402 662 4,955 22 19,172 1,427 21 206 . 56.630 43,134 58,545 81,033 45,771 402 1,224 6,407 16 164 129 1,716 2,405 4,433 3,704 3,293 3,610 2.999 954 3,977 2,632 303 1,192 6,299 12 223 192 789 2,149 4,084 2,834 3,015 3,236 2,236 712 4,088 2,333 525 1,496 8,013 54 229 254 1,030 2,686 5,364 3,940 4,250 4,282 2,801 985 5.305 2,330 894 1,551 10,528 57 69 3,008 1,252 5,984 8,604 141 7,872 4,586 4,160 683 6,351 2,212 753 1,300 8,657 37 72 2,152 964 4,959 7,029 143 6,101 3,739 3,539 456 5,215 1,357 38,065 33,697 43,544 57,952 Grand total Eastern District . 118,553 97,352 130,403 150,511 Allegheny District. Akron Canton & Youngstown_ Baltimore & Ohio Bessemer & Lake Erie • Buffalo Creek & Gauley Central RR. of New Jersey . Cornwall Cumberland & Pennsylvania . Ligonier valley Long Island c Penn-Read Seashore Lines.. _ PennsylvaniaSystem Reading Co Union (Pittsburgh) West Virginia Northern .. Western Maryland ... 632 22,834 862 294 5.181 5 355 165 681 1,080 48,324 12,378 3,370 89 2,743 643 19,713 543 239 3,550 0 256 216 825 963 40,688 7,629 2,533 56 2,327 b 25,112 685 137 6,534 48 367 159 1,224 c 58,176 12,205 4,808 70 2,946 415 11,411 663 8 9,903 25 14 14 2,698 1,549 28,539 12,857 715 1 4,710 .. 98,993 80,181 112,471 73.522 60,355 se .- 17,982 14,347 768 3.132 17,878 13,435 639 3,411 18,162 13,991 705 2,994 6,013 2,568 764 527 4,935 2,667 782 370 36,229 35,363 35,852 9,872 8,754 7,710 1,033 290 128 *24 881 388 224 6.541 15,591 105 8,804 865 284 108 39 1,075 421 243 5,603 15,079 136 8,933 931 296 112 48 1.396 491 304 7,408 19,443 173 3,921 1,250 884 277 45 892 734 2,562 3,104 10,034 467 3,270 1,253 751 154 55 761 713 2,831 2,630 9,025 469 Total Total Group CAnn Arbor Chicago Ind. & Louisville.. . Cleve. On. Chlo. dr St. Louis.. CentralIndiana • Detroit & Mackinac Detroit & Toledo Shore Line_ Detroit Toledo & Ironton_ . Grand Trunk Western Michigan Central Monongahela New York Chicago & St. Lou s Pere Marquette Pittsburgh & Lake Erie Pittsburgh & West Virginia Wabash Wheeling & Lake Erie Total Total Pocahontas District. Chesapeake & Ohio Norfolk & Western Norfolk & Portsmouth Belt Virginian Total Southern District. Group AAltai:ale Coast Line Clinchtield Charleston & Western Caroll III Durham & Southern Gainesville & Midland Norfolk Southern Piedmont & Northern Richmond Frederick.& Polo 1. Seaboard Air Line Southern System Winston-Salem Southbound... Railroads. Group BAlabama Tenn. & Northern... Atlanta Birmingham & Coast-AU.& W.P.-West. RR.of Ala Central of Georgia Columbus & Greenville Florida East Coast Georgia Georgia & Florida Gulf Mobile & Northern Illinois Central System Louisville & Nashville Macon Dublin & Savannah.... MississippiCentral Mobile & Ohio Nashville Cbatt. & St. LouisTennessee Central 1934. 1934. 1933. 1932. 187 509 598 2.838 180 823 594 256 1,134 14,624 14,765 100 118 1,443 2.074 240 138 493 496 2,320 186 761 810 217 928 15,253 14,679 112 108 1,475 2,266 262 210 686 630 2,949 317 1,051 718 215 1,305 18,324 16,388 120 121 - 1,842 2,531 480 110 632 979 2,230 259 522 1,212 386 600 8.332 3,231 432 208 1,269 1.839 611 1933 187 475. 781 1,824 125 420 1,017 246 519 6,200 2,597 334 158 986 1.653 642 40,483 40.504 47,887 20,852 18,164 Grand total Southern District 73,398 71,161 87,422' 45,022 40.076 Northwestern District. Belt Ry. of Chicago Chicago & North Western Chicago Great Western Chic. Milw. St. Paul & Pacific_ Chic. St. Paul Minn.& Omaha_ Duluth Missabe & Northern. DuluthSouth Shore & Atlantic Elgin Joliet & Eastern Ft. Dodge Des M.& Southern_ Great Northern Green Bay & Western Lake Superior & Ishpeming__ _ _ Minneapolis & St. Louis Minn. St. Paul & B. S. Marie.. NorthernPacific Spokane & International Spokane Portland & Seattle.. 554 11,645 1,968 15,343 3,530 468 385 2,953 184 7,417 421 243 1,317 3,943 7,045 49 724 408 10,295 1,888 12,895 2,673 316 239 2,205 192 6,179 403 259 1,365 3,280 6.082 52 533 1.044 13,721 2,609 17,644 3,548 403 405 2,976 97 7,777 477 790 1,225 8,104 2,190 5,773 2,005 145 276 4,138 109 1,567 289 80 1,276 1,664 1,704 142 865 1,010 6,014 1,607 4,382 1,536 48 316 2,843 102 1,055 269 52 1.004 1,151 1,313 101 574 58,189 49,264 65,422 31,552 23,377 14,923 2,068 186 12,170 1,528 8.775 2,446 894 2,411 351 941 1,918 336 101 11.021 240 328 11,093 371 1,026 15,316 2,300 203 10,910 1,155 8,921 2,034 1,301 2,081 218 936 1,578 294 105 8,620 194 227 8,902 565 775 19,979 3,063 200 15,823 411 99 12,907 230 260 12,619 931 1,244 4,034 1,449 27 5,433 725 4,887 1.513 799 1,539 5 682 924 189 51 2,645 223 789 5,332 5 1.028 3.214 1,221 17 4,166 548 4.547 1,430 618 1,240 27 654 709 140 67 2,309 196 566 4.072 73,127 66.635 90,103 32,279 26,649 116 119 216 2,014 1,987 147 1,418 1,037 312 246 720 75 3,913 11,518 43 112 6,411 1,787 4,713 3.365 1,170 11 109 102 204 2,185 1,640 136 1,222 766 196 209 654 44 3,836 11,129 49 121 6.600 1,745 4,364 3,116 1,061 25 137 172 284 a2,803 1,550 267 1,640 1,307 3.123 427 151 1,182 1,412 884 1,238 571 185 557 207 267 2,501 7,070 16 117 2,590 1,514 1,707 2,811 1,729 30 2,311 381 102 895 1,524 701 1,145 578 117 302 117 178 1,651 5,389 11 99 2,36 f 1,017 1,905 2.349 1.525 36 Total Total Central Western District. Atch. Top.& Santa Fe System_ Alton Bingham & Garfield 116,449 Chicago Burlington & Quincy Chicago & Illinois Midland Chicago Rock Island & Paola°. Chicago & Eastern Illinois 408 Colorado & Southern 9,028 Denver & Rio Grande Western_ 535 Denver & Salt Lake 3 Fort Worth & Denver City.... 7,880 IllinoisTerminal 36 Northwestern Pacific 8 Peoria & Pekin Union 12 Southern Pacific (Pacific) 2,040 St. Joseph & Grand Island 1,243 Toledo Peoria & Western 23,896 Union Pacific System 11,725 Utah 449 Western Pacific 46,473 3,1)ii - Total Loads &MN from Connections. Total Revenue Freight Loaded. Total Southwestern District. Alton & Southern Burlington-Rock Island Fort Smith & Western Gulf Coast Lines lnternational-Great Northern... KansasOklahoma & Gulf Kansas City Southern Louisiana & Arkansas Louisiana Arkansas & TexasLitchfield & Madison Midland Valley MI/3801111 & North Arkansas Missouri-Kansas-Texas Lines... MissouriPacific Natchez & Southern Quanah Acme & Pacific St. Louis-San Francisco St. Louis Southwestern Texas & New Orleans Texas & Pacific Terminal RR.Assn. of St. Louis Weatherford Min.Wella & N.W. 1,739 4,279 7.913 12.999 2,700 1,435 3,090 600 1.513 315 817 48 5,015 14,275 45 121 7,768 2,327 5,580 3,921 1,564 49 903 Total 39,535 24.170 21,912 30,657 32.915 24,695 Total 30.289 50.005 39,513 41,450 •Estimated. b Not available. c Pennsylvania-Reading Seashore Lines Include the new consolidated lines of the West jersey & Seashore RR., former 9 Part of Pennsylvania RR.,and Atlantic City RR., formerly part of Reading Co.; 1932 figures included in Pennsylvania System and Reading Co. •Previous week's figures. Investment Valve Almost Closed, Says Colonel Ayres of Cleveland Trust Co.-Urges that Congress Investigate Immediately Whether Federal Securities Act Is Responsible-Profit Valve of Business Pump "Operating Intermittently and Leaking Badly"-Recovery Dependent on Substitution of Flow of Private Expenditures for that of Public Expenditures-Views on Rising Prices. Commenting on "the generous spending of public funds"the chief purpose of which, he says "is that of priming the business pump"-Col. Leonard P. Ayres, Vice-President of the Cleveland Trust Company of Cleveland, states that "the next few months will demonstrate how successful the attempt will be." Col. Ayres observes that "the business pump has two valves; one the new investment valve, and the other the profit valve." He refers to the investment valve as "almost closed", adding that it "seems to be stuck tight." He goes on to say "a good many people claim that it is clogged by the Securities Act. That" he adds "is a matter for the Congress to investigate thoroughly, promptly and with no stubborn pride of craftmanship, for the business pump will not function until the valve is free. Business recovery" says Col Ayres "can be continued in the long run only by the progressive substitution of a flow of private expenditures for that of public expenditures." He adds -lavish public expenditure to create recovery that private enterprise could not sustain would be futile and perhaps disastrous." In surveying unemployment conditions Col. Ayres states that "the Census of 1930, showed about 49 million people in gainful occupations, of whom about 26 million were producers of goods, and the remaining 23 millions providers of services. Last March almost 14 million of them were out of work. Of the 23 millions of providers of services almost six million were unemployed, and among the 26 million producers of goods about eight million were idle. If we could return the producers to work" be says "the problems of the service workers would largely solve themselves." Col. Ayres views as above were contained in the "Business Bulletin" of the Cleveland Trust Company, issued Jan. 15. Below we quote in full Col. Ayres' comments, omitting all the diagrams referred to therein. For the first time in the long depression a new year has begun with general business activity at a higher level than it was at the beginning of the previous year. and with a greater volume of industrial production. The last time that this happened was five years ago in January of 1929. Public expendiures are responsible for much of the improvement. A considerable portion of the recent advances in wholesale and retail trade is due to the great farm bonus payments and to the wage disbursements • 396 Financial Chronicle of the emergency relief projects, while industry has felt the stimulus of the public works activity. The chief purpose of the generous spending of public funds, in addition to giving relief to the unemployed, is that of priming the business pump. The object of pouring public funds into the mechanism is to cause a normal stream of private funds to start flowing through it. The next few months will demonstrate how successful the attempt will be. The people are watching the experiment attentively, hopefully, 'and with a good deal of confidence. They are well aware that this Congress in its emergency session last spring not only made lavish provision of public funds with which to do the priming, but also hurriedly made extensive novel alterations and repairs to the purity itself. The people furnish the power that operates the business pump, and they are eagerly anxious to be back at their old job of doing it. So far their accomplishment has been limited because the repair job of last spring has not yet proved wholly successful. The business pump has two valves; one the new-investment valve, and the other the profit valve. The investment valve is almost closed, and seems to be stuck tight. That A good many people claim that it is clogged by the Securities Act. and with is a matter for the Congress to investigate thoroughly, promptly, will not no stubborn pride of craftsmanship, for the business pump obstacle function until that valve is free. If there really is a serious there it ought to be removed. The profit valve is operating intermittently and is leaking badly. Our business pump was so designed as to provide it with wide freedom of movements. action, but the adjustments of last spring greatly restricted its The repair group had disagreements about it, some claiming it should be closed. left alone, and a few holding that it should be kept permanently leaking. The compromise taken was to leave it partly opened and always The job of Congress is to finish its repair job before it uses up all the priming water, for the available supply is strictly limited. Business recovery can be continued in the long run only by the progressive substitution of a flow of private expenditures for that of public expenditures. If there exist obstacles preventing that substitution they have been unintentionally created by the Congress, and could be removed by it. Lavish public expenditure to create recovery that private enterprise could not sustain would be futile and perhaps disastrous. Production. The changes in the volume of industrial production during the year 1933 were greater and more rapid than any previously recorded. In the first quarter there was a decline that did not however carry the figures as far down as they went in the summer of 1932. In March, production was more than 45% below the computed normal level. From March to July occurred the most rapid increase ever recorded which lifted production to within 9% of normal, or an advance of over 36 points. Then came a new decline which carried it down again by November to nearly 34% below normal, or a drop of some 25 points. The decline of the second half of the year canceled more than two. thirds of all the recovery attained in the spring and early summer. The figures for December are still preliminary and little better than estimates, but it is unlikely that final data will alter them much. They indicate a volume of industrial production in December slightly above that of November. This is somewhat disappointing in view of the numerous optimiatic reports of rapid improvement featured in the newspapers, but nevertheless encouraging in that the rapid decline under way since July has at last been reversed. At about 3" below normal the volume of industrial production is apprcximately at the level at which it was late in 1931. The lowest level reached in the depression of 1921 was 27 below, and before that declines as great as to 20 below were recorded only in 1893 and during the embargo in 1808. The index shown in the diagram is based on the figures of the Federal Reserve Board restated so as to show how percentage deviations above and below the computed normal level, but the data cited for years prior to this century are from compilations made by this bank, as are the estimates for December of 1933. Prices. Mr. J. M Keynes, the British economist, said in his recent open letter to the l'resident that rising prices are to be welcomed when they are the symptons of increasing production and employment, but not if they are brought about at the expense of greater production. The distinction is an important one with a direct bearing on our national program for reform and rcoa cry. In recent months the new codes and the agricultural regulations haN e brought about a good many irregular price advances, but these have been accompanied by serious declines in industrial production. TI.e adininistrstion has meanwhile made vigorous efforts to stimulate business and causc a general price advance through monetary manipulation, but without mueli success. The simple principle underlying the problem of price lifting is that so long as 'limey conditions remain even approximately normal the controlling factors are the familiar old ones of relationships between demand and supply. Under such conditions the requisite for a general advance in commodity prices is a state of prosperous activity in business. Depression conditions do not produce general price advances because every demand for goods is met with numerous and competing offers to supply them. Such conditions make what is known as a buyers' market, for the buyer can within reason dictate his own terms. In times of prosperity it is the seller who can dictate the terms, for then numerous buyers are competing for his goods and bidding up the offered prices. That is the way in which changes in general commodity price levels have actually worked out in this country in past years. In the diagram the columns represent changes in the index number for wholesale prices in this country in periods of depression and of prosperity during the 100 years from 1833 through 1932. The data were taken from the diagrams and records compiled by this bank showing changes in business activity and in prices since 1831. In that 100 year period the commodity price index made advances of 415 points in veers at the close of which business activity was above normal, but advances of only 11 points in years closing with activity below normal. The general conclusion is that price advances come with prosperity when increasing demand is competing for goods and when activity has created sellers' markets. The way to lift prices is to get out of depression and then let demand do the lifting. What we have been trying to do has been to mark up prices by new laws and codes and gold quotations during a period of deep depression when demand is small and supply competes to meet every purchase offer. The record with respect to price declines in the 100 years is of less Immediate interest in this present discussion. The two columns at the right in the diagram show, as one would expect, that price declines come mainly in depression years, but not infrequently in those of prosperity. Jan. 20 1934 The rule that prosperity is needed to produce price advances is much more binding than a converse rule about declines. No doubt enough inflation, devaluation, legal regulation, and federal appropriation can eventually lift price levels even against the forces of depression, but whether the advances so secured will prove to be those favorable symptons of increasing production and employment of which Mr. Keynes writes is most gravely to be doubted. Wages. Some of the unexpected changes that occur when new laws regulate matters previously left to supply and demand are beginning to come to light in connection with the operations of industrial codes. Among the most interesting are changes in wages paid to factory workers. In the oiagram the three lines represent the monthly changes during the depression in the hourly wages of skilled and semi-skilled male workers, in those of unskilled male workers, and in those of women employees in factories. The data are those reported by the National Industrial Conference Board for factories workers in 25 'industries. In each case the average for 1929 is taken as being equal to 100, and the latest data used are those for November 1933. The lines have been slightly smoothed to avoid confusing crossing and recrossing in 1930 and 1931. All three classes of workers suffered sharp reductions in wage rates after 1930, and in each case the lowest points were reached early in 1933. The declines in the pay rates of the women workers were little more severe than in those of the men. In the middle of 1933 the regulations of the new codes began to go into effect. Since the uptuln of wages began the pay rates of the skilled and semi-skilled men have made the smallest proportional advance, those of the unskilled men a larger one, and those of the women workers the largest of all. More astonishing still is the fact that the wage rates of the women workers have advanced so much that they are well above the levels of the prosperity period of 1929. This result may not be so favorable to the women workers as the diagram might indicate. The New York Department of Labor has recently completed its annual enumeration in certain test areas of individuals able and willir,g to work who are unemployed. It shows slightly less unemployment among men than prevailed late in 1932, but it indicates that there is this year well over twice as much unemployment among women as there was last year. Now the new codes lay down the rule that women doing the same factory work as men shall receive the same pay. Apparently the wages of women still at work have been notably advanced, but apparently unemployment among them has increased bemuse with wage equalization employers have preferred to hire men. Unemp/oyment. The diagram at the foot of this page shows an attempt to estimate unemployment, and its distribution. We do not have in this country any , attempt of this sort regular official reporting of employment, so eve?) must be partly based on statistical estimates. We do have a considerable number of employment indexes, and these must be used as the basis for any Inclusive estimates. In the diagram the area between the base line just above the figures, and the irregular dashed line, represents the unemployed each month since the beginning of 1930 in the construction industries, while the lowest column of figures gives their numbers in thousands of workers. Buildings are durable goods and so are many industrial products made of such lasting materials as the metals, lumber, cement, clay, glass, and stone. The unemployed in these other durable goods industries are represented by the area between the dashed line and the lowest solid line, and their estimated numbers in thousands are stated in the second column of the table. The area between the next two solid lines represents the unemployed in the industries making or raising consumption goods such as foods, and textiles, and articles made of paper, rubber, leather, and the like. The figures are in the third column. The uppermost area, and the figures in the fourth column, represent unemployed in the service occupations such as wholesale and retail trade, transportation, communication, professions, public positions, and domestic work. The Census of 1930, showed about 49 million people in gainful occupations, of whom about 26 million were producers of goods, and the remaining 23 millions providers of services. Last March almost 14 million of them were out of work. Of the 23 millions of providers of services almost six million were unemployed, and among the 26 million producers of goods about eight million were idle. The classification of employment data in these two groups is an aid in thinking about our depression problem for it is the unemployment among the producers that causes the idleness among the providers of services. It is highly significant that roughly one-half of the unemployment is caused by the other half of it. It we could return the producers to work, the problems of the service workers world largely solve themselves. The controlling factor in unemployment among the producers is that of the workers in the durable goods industries. There is the key to our depression problem, and in large measure the solution lies in restoring the long-term financing through new corporate bond issues on which those industries depend. The data used in the diagram and table are not corrected for seasonal variation, and they have not been adjusted to allow for growth in population since the last census. They apply only to what we may term regular or ordinary employment, and do not include estimates for the emergency relief work that has recently been greatly expanded by the CWA. The totals are similar to those compiled by the American Federation of Labor. Slight Increase Noted in "Annalist" Monthly Index of Business Activity for December as Compared with November—First Advance in Four Months. The year 1933 closed with the "Annalist" Index of Business Activity showing a slight upturn, following four months of recession from its July peak of 89.4. The preliminary index for December is 69.2, as against 68.4 for November and 72.4 for October, reports the "Annalist." Except for a further pronounced decrease in the index of cotton consumption, caused by voluntary curtailment under the code, the "Annalist" said, the combined index would have shown a larger gain. Under date of Jan. 19 the "Annalist" further noted: The freight car loadings, steel ingot, pig iron and lumber production indices showed substantial gains, and minor increases wore recorded by electric power and automobile production. Aside from the decrease in the cotton consumption index, the only declines were in the indices of silk consumption and zinc production, although figures are not yet available for wool consumption and for boot and shoe and cement production. Table I gives the combined index and its components, each of which is adjusted for seasonal variation, and where neemsary for long-time trend. for the last three months. Table II gives the combined index by months back to the beginning of 1928. TABLE I-THE "ANNALIST" INDEX OF BUSINESS ACTIVITY AND COMPONENT GROUPS. Freight car loadings Steel ingot production Pig iron production Electric power production Cotton consumption Wool consumption Silk consumption Boot and shoe production Automobile production Lumber production Cement production Zinc production Combined Index December. November. October. 62.2 54.3 41.9 :88.5 68.5 59.4 41.9 37.2 88.0 83.8 92.3 59.2 95.4 29.9 48.3 33.9 65.7 68.4 59.0 54.9 45.0 89.4 90.4 102.4 49.6 101.2 51.3 52.6 31.5 71.1 72.4 51.5 z31.5 --756.0 60.5 *69.2 TABLE II-THE COMBINED INDEX SINCE JANUARY, 1928. 1932. 1933. 1931. 1930. 1929. 1928. 105.6 112.9 102.1 81.4 70.1 January 83.0 106.1 112.4 102.5 68.1 83.1 61.7 February 105.4 111.9 100.5 85.1 58.5 March 66.7 105.5 115.0 101.8 64.1 63.2 86.4 April 105.6 115.7 98.5 85.1 72.5 60.9 May 104.8 116.6 97.1 83.4 60.4 82.6 June 106.3 116.7 93.1 89.5 83.1 July 59.7 108.1 115.6 90.8 83.6 78.9 August 61.3 109.7 115.0 89.6 76.5 September 65.2 76.3 111.8 113.4 86.8 72.4 October 65.4 72.6 112.0 106.0 84.4 November 68.4 64.7 72.2 112.5 December 101.2 *89.2 645 72.1 83.9 • Subject to revision. x Based on an estimated output of 7,344,000,000 kilowatthours as against a Geological Survey total of 7.209,000,000 kilowatt-hours in November and 7,149,000,000 in December 1932. z Based on an estimated output of 66,000 cars and trucks as against Department of Commerce total of 66,195 cars and trucks in November and 109,543 cars and trucks in December 1932. y Based on an estimated output of 1,016,000,000 feet as against Federal Reserve Board total of 979,000,000 feet in November and 687,000,000 feet in December 1932. "Annalist" Weekly Index of Wholesale Commodity Prices Up 0.4 Point During Week of Jan. 16 on President's Gold Statement. A small advance of 0.4 point for the week was the response of the "Annalist" Weekly Index of Wholesale Commodity Prices to the President's gold statement Jan. 15, the index rising to 103.2 for Jan. 16 from 102.8 (revised) Jan. 9. In reporting this, the "Annalist" continued: The United States dollar fell 1.9 cents during the same time to 62.2 cents. The decline in the dollar was only partly offset by the rise in paper currency commodity values, and the "Annalist" index on a gold basis declined to 64.2 from 65.9 (revised). THE "ANNALIST" WEEKLY INDEX OF WHOLESALE COMMODITY PRICES. (Unadjusted for seasonal variation. 1913=100.) Jan. 16 1934. Jan. 9 1934. Jan. 17 1933. 87.5 102.8 *119.6 141.2 105.0 112.1 99.0 84.9 103.2 86.9 101.3 :119.2 143.1 105.0 112.1 :99.0 84.8 1102.8 64.0 88.4 66.3 114.0 93.9 106.6 95.2 69.7 82.7 ASS x65 9 arm products nod products 'extile products liela fetaLs .uilding materials hemicals fiscellaneous .11 commodities All mmmnt1Itlaa nn onla }main •Preliminary. a Revised. z Based on exchange quotations for France, Switzerland, Holland and Belgium. That the President's proposal to hold the dollar to between 50 and 60 cents was not regarded as inflationary, but rather as a step toward stabilization, was shown by the movement during the week of /goody's daily index, composed chiefly of international commodities especially sensitive to exchange fluctuations. Although in terms of paper dollars the index rose to 132.0 on Jan. 16 from 128.1 the week before,kon a gold basis it was unchanged at 82.1, its advance being only enough to offset the actual dollar decline. DAILY SPOT PRICES. Moodg's Index. Tan IA Cotton. Wheat. Corn. Hogs. U. S. Basis. Gold Basis. 10.95 11.05 11.10 11.05 11.25 11.65 11 an 1.014 1.031f 1.017i 1.03% 1.04% 1.08% i ovtz XX XXX3 .a.cotoott-cc c:Ra? c:R.Rc Jan. 9 Jan. 10 Jan. 11 Jan. 12 Jan. 13 Jan. 15 397 Financial Chronicle Volume 138 3.52 3.44 3.31 3.38 _ __ 3:40 128.1 128.9 128.2 129.5 129.7 132.7 82.1 82.2 82.2 82.6 82.6 81.5 a 19 199 9 no 1 Cotton-Middling upland, New York. Wheat-No.2 red, new, c.i.f. domestic, New York. Corn-No. 2 ye low, New York. Hogs-Day a average Chicago. Moody's index-Daily index of 15 staple commodities. Dec. 31 1931.--100; March 1 1933=80. Percentage Gain Over Corresponding Period the Previous Year in Production of Electricity Highest Since Week of Sept. 30 1933. According to the Edison Electric Institute, the production of electricity by the electric light and power industry of the United States for the week ended Jan. 13 1934 was 1,646,271,000 kwh., an increase of 10.1% over the corresponding period last year, the largest percentage increase since the week ended Sept. 30 1933, for which latter period the gain was 10.2% over the same period in 1932. The current figure compares with 1,563,678,000 kwh. produced during the week ended Jan. 6 1934, 1,539,002,000 kwh. during the week ended Dec. 30 1933, 1,656,616,000 kwh. during the week ended Dec. 23 1933 and 1,495,116,000 kwh. during the week ended Jan. 14 1933. All of the seven geographical areas reporting showed gains for the week ended Jan. 13 1934 as compared with the same period last year. As compared with the increases shown for the week ended Jan.6 1934 over the week ended Jan.7 1933, all, except the Middle Atlantic and West Central regions, showed further improvement. The Institute's statement follows: PER CENT CHANGES. Major Geographic Divisions Week Ended Week Ended Week Ended Week Ended Jan. 16 1934. Jan. 6 1934. Dec. 30 1933. Dec. 23 1933. New England Middle Atlantic Central Industrial.-Southern States Pacific Coast West Central Rocky Mountain +9.2 +8.6 +13.1 +10.4 +3.5 +8.8 +19.8 +8.7 +11.3 +13.0 +1.3 +3.4 +9.3 +19.1 +8.7 +6.2 +14.3 -3.7 +8.6 +4.3 +19.5 Teta! United States_ +10.1 +9.7 +8.8 +6.7 +6.1 +9.6 +1'7 + +1 . Arranged in tabular form the output in kilowatt hours of the light and power companies of recent weeks and by months since and including January 1930 is as follows: Week of- 1933. Week of- 1932. Week of- 1931. 1933 seer 1932. May 6 1,435,707,000 May 7 1,429,032,000 May 9 May 13 1,468,035,000 May 14 1,436,928,000 May 16 May 20 1,483,090.000 May 21 1,435,731,000 May 23 May 27 1,493,923,000 May 28 1,425,151,000 May 30 June 3 1.461,488.000 June 4 1,381,462,000 June 6 June 10 1.541.713.000 June 11 1,435,471,000 Juno 13 June 17 1,578.101,000 June 18 1,441.532,000 June 20 June 24 1,598.136.000 June 25 1,440,541,000 June 27 July 1 1,655,843,000 July 1 1,456,961,000 July 4 July 8 1,538,500,000 July 9 1,341,730,000 July 11 July 15 1,648,339,000 July 16 1,415,704.000 July 18 July 22 1,654,424,000 July 23 1,433,990,000 July 25 July 29 1,661,504,000 July 30 1,440,386,000 Aug. 1 Aug. 5 1,650,013,000 Aug. 6 1.426.986,000 Aug. 8 Aug. 12 1,627,339,000 Aug. 13 1,415,122,000 Aug. 15 Aug. 19 1.650,205,000 Aug. 20 1,431,010,000 Aug. 22 Aug. 26 1,630,394,000 Aug. 27 1,436,440,000 Aug. 29 Sept. 2 1,637.317,000 Sept. 3 1,464,700.000 Sept. 5 Sept. 9 1,582,742,000 Sept. 10 x1.423,977,000 Sept. 12 Sept. 16 1,663,212.000 Sept. 17 1,476,442,000 Sept. 19 Sept. 23 1,638.757.000 Sept.24 1,490.863,000 Sept.26 Sept.50 1.652,811,000 Oct. 1 1,499,459,000 Oct. 2 Oct. 7 1,646,136,000 Oct. 8 1,506,219,000 Oct. 10 Oct. 14 1,618,948,000 Oct. 15 1.507,503,000 Oct. 17 Oct. 21 1.618,795.000 Oct. 22 1,528,145,000 Oct. 24 Oct. 28 1.621,702,000 Oct. 29 1,533,028,000 Oct. 31 Nov. 4 1,583,412,000 Nov. 5 1,525,410,000 Nov. 7 Nov.11 1.616,875,000 Nov. 12 1,520,730,000 Nov. 14 Nov. 18 1,617,249,000 Nov. 19 1,531,584,000 Nov. 21 Nov.25 1,607.546,000 Nov. 26 y1,475,268.000 Nov. 28 Dec. 2 71,553,744,000 Dec. 3 1,510,337,000 Dec. 5 Dec. 9 1,619,157,000 Dec. 10 1,518,922,000 Dec. 12 Dec. 16 1,644,018,000 Dec. 17 1.583,384,000 Dec. 19 Dec. 23 1,856.616,000 Dec. 24 1,554,473,000 Dec. 26 Dec. 30 1,539,002.000 Dec. 31 1.414,710,000 Jan. 2 1933. 1934. Jan. 6 1,563,678,000 Jan. 7 131,425.639,000 Jan. 9 Jan. 13 1,646,271.000 Jan. 14 1,495,116,000 Jan. 16 1,637.296,000 0.5% 1,654,303,000 2.2% 1,644,783,000 3.3% 1,601.833,000 4.8% 1,593,662.000 5.8% 1,621,451.000 7.4% 1,609,931,000 9.5% 1.634,935,000 10.9% 1,607,238.000 13.7% 1,603,713,000 14.7% 1,644.638.000 16.4% 1,650,545.000 15.4% 1,644.089,000 15.4% 1,642,858,000 15.6% 1,629,011,000 15.0% 1.643,229,000 15.2% 1,637,533,000 13.5% 1,635,623,000 11.8% 1,582,267,000 11.1% 1,662,660.000 12.7% 1,960,204.000 9.9% 1,645,587,000 10.2% 1,653.369,000 9.3% 1,656,051,000 7.4% 1,646.531,000 5.9% 1,651,792,000 5.8% 1,628,147.000 3.8% 1,623,151.000 6.3% 1,655.051,000 5.6% 1.599,900,000 j 5.9% 1,671,466,000 i 1,617.717,000 6.6% 1,675,653,000 5.2% 1.564,652.000 6.6% 1,523,652.000 8.8% 1932. 1.619,265.000 9.7% 1,602,482,000 10.1% z Corrected figure. y Includes Thanksgiving Day. b Revised figure. DATA FOR RECENT MONTHS. Month of- 1933. 1932. 1931. January ____ February__ March April May June July August September_ _ October November December_ 6,480.897,000 5,835,263,000 6,182,281,000 6,024.855,000 6,532.686,000 6,809,440,000 7,058,600.000 7.218,678,000 6,931,652,000 7,094,412,000 6,831,573,000 7,011.736,000 6,494,001.000 6.771.684,000 6.294.302,000 6.219,554.000 6.130.077,000 6,112,175,000 6.310,667.000 6,317.733,000 6,633.865,000 6.507.804,000 6.638,424,000 7,435.782.000 6,678,915,000 7.370.687.000 7384,514.000 7,180.210.000 7,070.729,000 7,286,576,000 7.166,086.000 7,099,421,000 7,331,380,000 6,971,644,000 7.288.025,000 1930. 1933 Under 1932. 8.021,749,000 7.6% 7,068.788.000 103% 7.580,335.000 8.7% 7,416.191.000 4.3% 7.494,807.000 .6.0% 7,239,697.000 a11.1% 7,363.730,000 1115.5% 7,391,196,000.14.4% 7,337.106,000 a9.7% 7,718,787.000 a6.9% 7.270.112.000 a5.0% 6,566,601.000 Total 77.442,112,000 86.073,969,000 89.467.099.000 a Increase over 1932. Note.-The monthly figures shown above are based on reports covering approximately 92% of the electric light and power industry and the weekly figures are based on about 70%. Retail Prices Unchanged from Dec. 1 to Jan. 2 for -First Time Since May, According to Fairchild Index. For the first time since May retail prices remain unchanged as compared with the previous month. The Fairchild retail price index on Jan. 2 1934 at 88.0 (Jan. 2 1931=100) is the same as on Dec. 1, and compares with 71.8 as of Jan. 2 1933. Current prices, while showing no change as compared with the previous month, nevertheless, show an increase of 22.5% over those for the corresponding period a year ago. The latest prices also show a gain of 26.8% from the 1933 low. The index, issued Jan. 15, further shows: A study of the trend of prices for 1933 shows two distinct movements. Prices tended lower from Jan. 1 to May 1. and tended higher from June 1 to Dec. 1. The advance from June through November was sufficient to erase all the losses since September 1931 because the current index is the highest since that date. Presint prices still show a decrease of 12% from the January 1931 position and a decrease of 26% from the November 1929 high. The changes in retail prices during the month, with the exception of those for piece goods, were negligible. The upward movement in prices showed a considerable slowing up since the marked gain during August. A study 398 Financial Chronicle of the major groups shows that women's apparel prices have recorded the greatest increase above 1933, with infants' wear showing the smallest gain during that period. However, piece goods prices recorded the greatest advance from the May low point, largely due to the sharp gain in cotton wash goods. While the composite index showed no change during the month, slight decreases were recorded for several items, nevertheless with the cotton wash goods decline relatively marked. Furs which had shown the greatest gain also reacted rather sharply during the month. The price trend, as a whole, may be constructed as showing no definite trend. THE FAIRCHILD RETAIL PRICE INDEX-JANUARY 1931=100. Copyright, 1933, Fairchild News Service. Composite index Piece goods Men's apparel Women's apparel Infants' wear Home furnishings Piece goods: Silks Woolens Cotton wash goods Domestics: Sheets Blankets & comfortables Women's apparel: Hosiery Aprons & house dresses_ Corsets and brassieres Furs Underwear Shoes Men's apparel: Hosiery Underwear Shirts and neckwear Hats and caps Clothing, incl. overalls... Shoes Infants' wear: Socks Underwear Shoes Furniture Floor coverings VIusical instruments Luggage Elec. household appliances Dhina and glassware Jan. 2 1932. July 1 1932. Jan. 3 1933. May 1 1933. Dec. 1 1933. Jan. 2 1934. 83.5 78.9 86.1 84.9 88.7 82.6 75.1 71.5 77.2 76.2 79.5 76.2 71.8 69.6 73.0 74.1 77.1 73.0 69.4 65.1 70.7 71.8 76.4 70.2 88.0 84.8 86.2 90.5 90.5 85.9 88.0 82.8 86.2 90.3 90.4 85.8 78.0 81.5 77.3 68.4 74.0 72.1 64.3 70.9 73.7 57.4 69.2 68.6 69.8 82.0 102.7 69.8 81.7 96.9 79.6 82.6 71.8 77.2 68.2 74.3 65.0 72.9 92.4 93.9 92.6 91.8 82.1 87.7 92.1 79.8 81.2 86.6 68.2 80.6 87.4 66.5 73.8 81.0 63.4 76.7 84.4 70.4 71.0 78.6 59.2 75.5 83.6 66.8 69.2 76.5 79.6 102.2 96.0 94.6 87.6 82.9 97.6 101.9 96.1 92.0 89.2 83.1 82.4 82.0 87.2 85.7 87.6 91.9 71.0 73.7 79.5 74.6 80.6 83.6 67.5 70.9 77.3 70.0 72.1 80.3 64.9 69.6 74.3 69.7 70.1 76.3 86.1 92.3 90.8 78.4 81.8 87.8 86.1 92.9 90.0 78.6 81.9 88.1 87.1 87.8 91.4 84.8 83.7 65.2 75.9 90.2 92.0 72.8 80.0 85.8 77.0 81.4 58.4 66.3 81.4 86.3 74.0 74.3 83.0 71.9 80.8 56.2 62.7 77.4 82.2 74.0 74.3 80.9 69.4 79.9 50.6 60.1 72.5 81.5 88.3 92.1 91.0 97.6 95.2 57.3 79.7 77.1 88.3 88.3 92.2 90.7 97.2 95.5 57.4 80.5 77.4 88.6 National Industrial Conference Board Reports Further Drop in Cost of Living of Industrial Wage-Earners During December. The decline in the cost of living of industrial wage-earners, which began with a drop of 0.3% in November after six months of steady advance, continued in December with a further drop of 0.6%, according to the regular monthly survey of the National Industrial Conference Board announced Jan. 17. Total living costs were 22.8% lower than in December 1929, but 2.9% higher than in December 1932. The Board's survey further said: The purchasing value of the wage-earner's dollar, in terms of the base, 1923=100 cents, was 129.4 cents in December, as compared with 128.5 cents in November and 139.9 cents in April. Food prices declined sharply in December, 1.8%. They were, however, 6.1% higher than in December 1932, but still 33.7% lower than in December 1929. -Rents showed no decline, holding the November level, which was 7.0% below December 1932, and 31.5% below December 1929. Clothing prices fell off 0.5%, which is the first reduction since April. They were, however, still 21.9% higher than in December 1932, but 22.1% lower than in December 1929. Practically no change was noted in the cost of coal. Compared with December 1932, the cost of this item increased 2.8% and compared with December 1929, it has fallen 9.0%. The cost of sundries showed no change, remaining at a level 0.2% higher than in December 1932, and 6.7% lower than in December 1929. Item. P. C. Inc.(+) Relative Index Numbers of Importance the Cost of Living or Dec. (-) in Average Prices 1923=100. Between Family Nov. 1933 & Nov. 1933. Dec. 1933. Dec. 1933. Budget. 73.0 --1.8 71.7 33 Food • 62.8 62.8 0 Housing 20 77.8 77.4 Clothing 12 --0.5 87.4 87.5 +0.1 Fuel and light 5 (+0.1) (84.8) (84.7) (Coal) (0) (92.9) (92.9) (Gas and electricity) 91.5 0 Sundries 30 91.5 100 77.3 77.8 --0.6 Weighted avge. of all items_ • Based on food price Indexes of the United States Bureau of Labor Statistics November index as of Nov. 7, December index average of indexes of Dec. 5 and Dec. 19. Improved Employment Conditions Noted in United States and 12 Other Nations by International Labor Office at Geneva. A world-wide improvement in the employment situation, led by the United States, was noted in a communique by the International Labor Office, issued on Jan. 6, according to Associated Press advices from Geneva published in the New York "Herald Tribune," in which it was also stated: "In the United States," the statement said, "the rise in the employment index is very marked-73.5 in October 1933, as compared with 59.6 in October 1932." A comparison between the last quarter of 1933 and that of the previous year showed a decline in unemployment In 13 Nations: The United States, Canada, Chile, Germany, Great Britain, Hungary, Austria, Belgium, Finland, Jugoslavia, Rumania, Denmark and the Irish Free State. In Great Britain the index of employment in December rose from 91.6 In 1932 to 97.5 in 1933, the Labor Office revealed. Jan. 20 1934 Figures for November of 1932 and 1933 indicate an increase of the index In Canada from 71.1 to 76.6. In Japan the index rose from 81.8 in August 1932 to 90 in August 1933. In Italy the index for October 1932 was 70.5, while for the same month last year it was 73.6. The communique said that 10,076,000 persons were jobless in the United States in October 1933, compared to 11,586,000 in October 1932. Figures for 1929 were regarded as equaling 100 as the basis for the employment index. "It is essential to know," the statement added, "that even within the same country the figures for two diferent days are not always comparable, owing to legislative and administrative changes, or to the fact that unemployed persons who have exhausted their right to benefits no longer appear in certain statistics. It may happen that a decrease in published figures does not represent a corresponding decrease in the volume of' unemployment." The number of unemployed in Germany in December 1933 was given as 3,714,107, compared with 5,355,428 in December 1932. The German employment index for the last quarter of 1933 was not received. November 1933 Electricity Sales Were 5.4% in Excess of Corresponding Period in 1932-Revenue Off 1.8%. The following statistics, covering 100% of the electric l'ght and power industry, were released by the Edison Electric Institute on Jan. 10. Month of November 1933. 1932. x Kilowatt-hours generated (net)By fuel By water power Total kilowatt-hours generated Additions to supplyEnergy purchased from other sources Net international imports Per Cf. Change. 4,449,526,000 3,815,706,000 +18.6 2,271,555,000 2,622,846,000 -13.4 6,721,081,000 6,438,552,000 +4.4 203,818,000 73,248,000 211,319,000 -3.5 30,409,000 +140.9 277,066,000 241,728,000 +14.6 64,969,000 101,805,000 70,868,000 101,608,000 -8.3 -0.0 166,574,000 Total 6,831,573,000 Total energy for distribution Energy lost in transmission, distribution, &c. 1,115,802,000 Kilowatt-hours sold to ultimate consumers.. 5,715,771.000 Bales to ultimate consumers (kwh.)1,080,510,000 Domestic service Commercial: 1,101,700,000 Small light and power (retail) 2,862,335,000 Large light and power (wholesale) 196,794,000 Municipal street lighting 352,749,000 Railroads-Street and interurban 58,673,000 Electrified steam. 63,010,000 Municipal and miscellaneous 172,476,000 6,507,804,0(5) 1,084,554,000 5,423,250,000 +5.0 +2.9 +5.4 Total Deductions from supplyEnergy used in electric railway dents Energy used in electric and other depts.__ 1,075,749,000 +0.4 1,116,797,000 2,577,808,000 206,691,000 349,584,000 45,678.000 50,943,000 -1.4 +11.0 -4.8 +0.9 +28.4 +23.7 5,715,771,000 5,423,250,000 Total sales to ultimate consumers +5.4 Total revenue from ultimate consumers._ $153,979,800 $156,861,500 -14 -12 Months Ended Nov. 30- Per Cf. 1932, 1933. x Kilowatt-hours generated (net)Change 47,063,249,000 46,467,266,000 By fuel +1.3 31,622,772,000 30,945,358,000 By water power +2.2 78,688,021,000 77.412,624,000 Total kilowatt-hours generated 2,863,647,000 2,778,894,000 Purchased energy (net) Energy used in electric ry. & other depts.-- 1,910,907,000 2,100,075,000 79,638,761,000 78,091,443,000 Total energy for distribution Energy lost in transmission, distribution, &c.14,230,981,000 13,754,006,000 Kilowatt-hours sold to ultimate consumers...65,407,780,000 64,337,707,000 $1,774,849,900 $1,846,838,400 Total revenue from ultimate consumers Important Factors40.2% Per cent of energy generated by waterpower_ 1.45 Average pounds of coal per kilowatt-hour Domestic service (residential use): 604 Aver,annual consumption per rust.(kwh.) 5.50 Average revenue per kwh.(cents) cust $2.77 domestic per Average monthly bill Basic Information as of Nov. 30. Generating capacity (kw.)-Steam Water power Internal combustion Total generating capacity in kilowatts Number of customersFarms in Eastern area (included with domestic) Farms in Western area (incl. with Coml-Large) Domestic service Commercial-Small light and power Large light and power All other ultimate consumers +1.6 +3.0 -9.0 +2.0 +3.5 +1.7 -3.9 40.0% 1.49 601 5.59 $2.80 +0.5 -1.6 -1.1 . 1932. 1933. 24,053,900 24,345,600 9,002,800 8,899,400 460,600 451,100 33,517,300 33,696,100 (506,689) (204,433) 19,961,895 3,690,769 530,301 66,145 (499,805) (204,690) 19,883,400 3,686,416 551,298 68,938 24,249,110 24,190,052 Total ultimate consumers x As reported by the U. S. Geological Survey, with deductions for certain plants not considered electric light and power enterprises. Recession in Retail Prices of Food Continued During Two Weeks Ended Dec. 19, According to United States Department of Labor. Retail food prices continued to recede during the two weeks' period ended Dec. 19 and moved further downward, according to an announcement made Jan. 10, by the Bureau of Labor Statistics of the U. S. Department of Labor. The index number of the general level of prices for Dec. 19, as reported by Isador Lubin, Commissioner of Labor Statistics, showed a decrease of 13/2% over the two weeks' period, the announcement said. The index dropped to 103.9 as compared with 105.5 on Dec. 5 and 106.8 on Nov. 21. The present index, based on the 1913 average as 100.0, places prices about 15% above the low point reached in April, when the index stood at 90.4, 73/2% over the index for June 1933, when the index registered 96.7 and more than 3% below the high point for the present year, when it stood at 107.4, on Sept. 26. As compared with the index of 98.7 for December a year ago prices on Dec. 19 The announcement added: were up 1-y approximately 5 The drop in retail food prices was caused by a further weakening in the average prices of most meats, butter, lard and a sharp drop in the price Volume 138 Financial Chronicle of eggs. Other important items 'which defFeased in average prices and Influenced the drop were flour, cheese, granulated sugar and coffee. Advancing prices were reported in the general average for onions, cabbage, tea, bananas and wheat cereal. During the two weeks' period the index number for the meat group showed a decrease of approximately 1%, cereal foods declined nearly % of 1%, while dairy products registered a fall in prices of 4%. Comparing prices with one year ago, dairy products registered a decrease of over 1%, meat items showed a decine of 23 % as contrasted with an increase of approximately 24% for cereal foods. As compared with April 15 1933, meats have shown an increase of approximately 2%, dairy products a rise of nearly 7%, with cereal foods advancing 26%. The weighted index numbers of the Bureau, which uses the average prices for the year 1913 as 100.0, were 103.9 for Dec. 19; 105.5 for Dec. 5: 106.8 for Nov. 21; 106.7 for Nov. 7 107.4 for Sept. 26, as compared with 90.4 for April 15 1933 and 98.7 for Dec. 15 1932. The prices used in constructing these indexes are based upon reports to the Bureau of Labor Statistics from all types of retail food dealers in 51 cities and cover quotations on 42 important food items. Changes in Retail Prices of Food by Cities. Decreases occurred in 46 of the 51 cities covered by the Bureau from Dec. 5 to Dec. 19. Cincinnati and Springfield, Ill., with a drop of 33 %, shod the greatest decline. Washington, D. C., showed a drop of nearly 2%. ilolumbus, Ohio,showed the smallest drop by falling only 0.2 of 1%. The.Tollowing five cities showed an increase: New Haven, 0.1 of 1%; Charleston, S. C., 1.4%, and Little Rock, 2.7%; Atlanta, 1.1%, and Houston, 0.6%. Comparing prices with Dec. 15 1932, 48 of the 51 cities showed an increase. Houston, where food prices have increased more than 13%, showed the largest advance during the 12 months. Other cities showing advances of 10% or more were Detroit and Little Rock. The smallest increases were reported for Los Angeles and Seattle, where prices were only 1% higher. For Washington, D. C., the increase was nearly 8%. Since April 15 1933 when the general average of retail food prices was the lowest for the present year, all of the 51 cities have shown substantial advances. The general average has risen nearly 15%. Little Rock, where prices are more than 22% higher, shows the great increase. Other cities showing an advance of 20% or more are Minneapolis and St. Paul. Prices in Washington have advanced 15%% since April. The smallest Increase is shown for Butte, where retail food prices have advanced by about 6%%. Per cent changes for each of the 51 cities during the two weeks' period and since Dec. 15 1932 and Aprll 15 1933. are shown in the following table: Per Cent Change on Dec. 19 1933 Compared with City. Per Cent Change on Dec. 19 1933 Compared with Dec. 15 Apr. 15 Dec. 5 1932. 1933. 1933. Atlanta Baltimore.._ _. Birmingham... Boston Bridgeport _..... Buffalo Butte Charleston,S.C. Chicago Cincinnati Cleveland Columbus Dallas Denver Detroit Fall River Houston IndianapolisJacksonville ___ Kansas City_ -Little Rock_ _ _ Los Angeles__ Louisville Manchester_ _ _ Memphis Milwaukee +7.8 +6.2 +3.2 +2.1 +5.2 +4.4 -1.4 +9.2 +5.6 +4.0 +9.6 +9.5 +7.2 +2.4 +12.7 +6.0 +13.3 +4.9 +7.5 +1.8 +12.1 +1.1 +6.6 +4.9 +8.0 +3.4 +18.8 +17.4 +14.3 +14.1 +15.7 +16.9 +6.4 +19.5 +12.0 +12.1 +18.9 +17.6 +18.8 +11.1 +19.6 +18.4 +15.5 +19.1 +19.3 +9.1 +22.3 +11.8 +14.5 +16.4 +18.3 +9.6 City. Dec. 15 Apr. 15 Dec. 5 1932. 1933. 1933. +1.1 Minneapolis__ _ -1.9 Mobile -1.0 Newark -2.3 New Haven ---1.1 New Orleans--1.5 New York -2.1 Norfolk +1.4 Omaha -1.3 Peoria -3.5 Philadelphia___ -1.2 Pittsburgh -0.2 Portland, Me.. -2.3 Portland. Ore__ -1.9 Providence- -- _ -1.3 Richmond -1.3 Rochester +0.6 Bt. Louis -1.6 St. Paul -1.7 Salt Lake City_ -2.0 San Francisco+2.7 Savannah -3.3 Scranton -0.7 Seattle -1.5 Springfield, Ill-1.1 Wash'g'n. D.C. -2.0 Miter! (*.Atm__ +6.7 +4.8 +3.3 +5.6 +5.4 +4.1 +4.8 +8.7 +6.2 +7.6 +5.9 +3.4 -1.3 +5.9 +7.9 +7.2 +6.5 +9.7 +2.6 -0.9 +6.5 +6.8 +1.1 +4.4 +7.8 +5.3 +21.6 +12.5 +17.4 +17.1 +17.3 +14.4 +19.6 +17.7 +11.8 +17.9 +15.5 +11.7 +10.9 +15.0 +19.1 +17.3 +14.6 +20.4 +11.1 +7.7 +18.2 +16.3 +8.0 +9.6 +15.5 +14.9 -1.7 -0.6 -1.3 +0.1 -0.7 -2.7 -2.0 -0.9 -2.4 -2.3 -2.4 -2.1 -1A -1.8 -0.9 -1.5 -2.6 -1.2 -2.6 -2.8 -1.4 -1.7 2.1 -3.5 -1.9 -L5 Changes in Food Prices by Commodities. Of the 45 articles of food covered by the Bureau, 20 showed decreases during the two weeks' period, 16 recorded no change in average prices, while nine showed an increase. During the year period, 15 of the 45 items covered showed a decrease, 26 showed an increase, with pork and beans the only item showing no change in average prices. The decreases ranged from 0.3 of 1% for tea to j93% for eggs. The increases ranged from 1.1% for lard substitute to 72% for cabbage. Since April 15, when the general average registered the low point, 32 of the 45 items covered have shown an increase ranging from approximately 1%% for margerine to nearly 75% for eggs. Part of which was seasonal. Decreases were registered for eight items running from 0.7 of 1% for sirloin steak to 7% for hens. Round steak and raisins are the only Items showing no change during the period. The following table shows the per cent changes which have taken place in each of the items covered on Dec. 19 as compared with Dec.51933,April 151933,and Dec. 151932: Article. Per Cent Change on Dec. 19 1933 Compared with Dec. 15 Apr. 15 Dec. 5 1932. 1933. 1033. Sirloin steak _ Round steak.. Rib roast Chuck roast--. Plate beef Pork chops.... Sawn, sliced.. Ham,sliced,.... Lamb. leg of.... Hens Salmon. red, canned Milk. fresh._ Milk, eve peed_ Butter Margarine Cheese Lard Vegetable lard substitute _ Eggs, strictly fresh Bread, wheat.. Bread,rye Flour -7.0 -0.7 -6.2 0.0 -10.0 -3.4 -6.3 -1.3 -9.3 -3.0 +12.5 +11.2 +6.9 +10.5 +3.6 +9.0 -1.4 -6.1 --7.0 +6.7 +7.7 +4.6 -19.1 -13.8 -0.4 +16.0 +1.1 -1.4 -0.4 -2.0 -1.3 -1.0 +0.5 0.0 -0.9 -1.4 +0.5 +13.7 0.0 +10.9 0.0 +17.2 0.0 -5.1 --13.9 +1.6 +6.2 +19.0 -2.1 +3.3 -19.5 +74.5 +19.7 +23.4 0.0 Article. Per Cent Change on Dec. 19 1933 Compared with Dec. 15 Apr. 15 Dec. 5 1932. 1933. 1933. Corn meal Rolled oats. -Corn flakes_ _ Wheat cereal... Macaroni Rice Beans, navy Potatoes Onions Cabbage Pork and beans_ Corn. canned_ Peas. canned._ Tomatoes.can'd Sugar ... Tea Coffee Prunes Raisins Bananas Oranges 0.0 Peaches. canned 0.0 Pears. canned--2.1 +14.3 +11.9 +4.7 +8.1 +6.8 +16.7 +34.1 +53.3 +40.7 +72.0 0.0 +6.9 +7.9 +13.8 +7.8 -0.3 -11.1 +20.2 -5.2 +8.3 9.5 +17.6 0.0 +17.9 0.0 +7.2 0.0 +8.1 +0.4 +9.7 0.0 +22.8 0.0 -1 34.1 0.0 +43.8 +4.5 +18.8 +8.6 +7.5 +10.3 +6.3 -1.4 +12.4 -0.9 +7.1 0.0 +16.5 +1.0 +7.8 -1.8 +4.3 +1.0 -3.3 -0.4 +21.6 0.0 0.0 -2.2 +9.3 +1.2 +2.4 0.0 -0.5 399 Increase of 0.3% Noted in Weekly Index of Wholesale Commodity Prices of United States Department • of Labor for Week of Jan. 6. Wholesale commodity prices rose by 0.3 of 1% during the first week of the present year, according to an announcement made Jan. 12 by Isador Lubin, Commissioner of Labor Statistics of the U. S. Department of Labor. During the week of Jan. 6, five of the 10 major groups of commodities covered by the Bureau showed advances, three registered no change, with only two groups, duel and lighting materials and housefurnishing goods, showing fractional decreases. Continuing, the announcement said: The index number showing the general level of wholesale commodity prices for the past week was 71.0% of the 1926 average as compared with 70.8% for the week ending Dec. 30 1933. The same level was reached during the week of Nov. 25 and stands at nearly 15% over the general average for the first week in January 1933. Present wholesale prices are fractionally more than 19% above the low point reached for the year 1933 (the week ending March 4), when the index was 59.6. The high point reached during the past year was for the week ending Nov. 19. when the index registered 71.7. Present prices are 1% under that level. Market prices of farm products again showed a decided recovery by moving upward 2%% over the average for the previous week. The average for livestock and poultry, with an advance of more than 3% during the week, has shown an increase of about 11% In the past two weeks. Grains were also higher in price, moving upward by 3%. Other items in this group showing increases were cotton, eggs, onions and potatoes. Rising prices for hides and skins and certain leather items caused the hides and leather products group to advance % of 1%. The miscellaneous commodity group was moved upward by about % of 1% during the week. For the third consecutive week rubber prices continued to improve. Lubricating oil also showed a strengthening in average prices. The building materials group continued its advance and moved upward to a new high point of 85.5. The manufactured foods group showed a further increase with the index number moving up by 2 fractional points to 62.7. Cereals were largely responsible for this increase. Butter showed a reaction after the material advance of the week before. Other items showing an increase in average prices were apples, oranges, coffee, lard and eggs. Fruits and vegetables also contributed to the advance of the group. Fresh pork, dressed poultry, raw sugar and edible tallow were among the items showing decreases. For the third consecutive week the index for textile products has remained at the same level with only minor fluctuations taking place within the group. Metals and metal products remained at the level of the week before. as did the chemicals and drugs group. Slightly weakening prices for bituminous coal fuel oil and Pennsylvania gasoline were responsible for the decline in the fuel and lighting materials group. Declining prices for metal beds and mattresses were largely responsible for the slight drop in the housefurnishing goods group. The index number of the Bureau of Labor Statistics is composed of 784 separate price series weighted according to their relative importance in the country's markets and is based on average prices for the year 1926 as 100.0. The accompanying statement shows the index numbers of the major groups of commodities for one year ago.for the low and high points of 1933 and for the past two weeks: INDEX NUMBERS OF WHOLESALE PRICES FOR WEEKS OF JAN, 7. MARCH 4, NOV.18 AND DEC.301933, AND JAN,6 1934. (1926=100.) Week EndingJan. 7 1933. Mar. 4 Nov. 18 Dec. 30 1933. 1933. 1933. Jan.6 1934. • All commodities 61.9 59.6 71.7 70.8 71.0 Farm products Foods Hides and leather products Textile products Fuel and lighting materials Metals and metal products Building materials Chemicals and drugs Housefumishing goods Miscellaneous 43.8 58.1 68.9 52.7 68.1 79.1 70.7 72.0 73.3 61.4 40.6 53.4 67.6 50.6 64.4 77.4 70.1 71.3 72.7 59.6 58.7 65.4 88.5 75.8 74.5 83.5 84.7 73.5 82.1 65.4 56.0 62.5 89.6 76.0 74.5 83.3 85.4 73.3 81.9 65.6 57.4 62.7 90.0 76.0 74.3 83.3 85.5 73.3 81.7 65.9 Valuation of Construction Contracts Awarded, as Compiled by F. W. Dodge Corp. The valuation of construction contracts awarded in the 37 States east of the Rocky Mountains in the month of December 1933 was $125,990,200 larger than in December 1932, the figure for December of this year being $207,209,500 against 1,219,300 in the same month of last year. For the 12 months of the year there is a decline from 1932 of $9,450,300. The consecutive monthly gains In construction contracts recorded since July 1933 were continued into December quite ignoring the seasonal tendencies customary during the period. The contract total reported in December by F. W. Dodge Corp. covering the 37 Eastern States amounted to $207,209.500; this was an increase of approximately 28% over the November total which itself registered a gain of almost 12% over October. In fact the total for the final month of 1933 was larger than that recorded for any other month since October 1931 and was more than 23 times as large as the contract volume recorded for December 1932. Of the December contract total 8155.862,800 was for publicly-financed construction while the remaining total of $51,346,700 was for privatelyfinanced undertakings. Publicly-financed construction contracts during December were almost nine times as large as the total for this class of work shown during April when such construction contracts were at their lowest point. Privately-financed contracts let during December were higher than for any month since April 1932 with but four exceptions during the summer of 1933. Commenting on this situation the Dodge organization observes: "This condition affords encouragement for the nearby future since usually it is private building activity that provides a basis for a sustained recovery in construction and business generally." Construction contracts awarded in the 37 States during the full year 1933 amounted to $1.255,708,400 as contrasted with the total of $1.351,158. 700 for 1932: this, it is seen, is a decline of about 7% between the two years Financial Chronicle 400 For the first half of 1933, contracts were running 35% behind the corresponding period of 1932; thus it is clear that during the final half of the year a considerable speeding up in contracts took place even though such Improvement was not quite sufficient to offset completely the loss recorded during the initial half. Os Residential building contracts awarded in 1933 totaled $249,262,100; this was a decline of 11% from the total of $280,067,900 reported in 1932. Multiple-family residential types combined-apartments, dormitories and hotels-recorded an advance in contracts between 1932 and 1933 amounting to almost 40%. Small houses,I. e., land 2-family dwellings, registered a loss between the two years amounting to about 21%. Non-residential building contracts awarded during 1933 amounted to $403,712,700; this was a loss of 16% from the total of 8480,789,600 rePorted for 1932. Losses in non-residential building types from 1932 were shown for commercial buildings, educational buildings, hospitals and institutions, public buildings, religious and memorial buildings, and social and recreational facilities. Strangely enough contracts for factory buildings awarded in 1933 were almost three times as large as the total recorded for 1932,in large measure due to the effects of brewery and distillery projects though improvement was shown elsewhere in factory types too. Contracts for public works of the engineering types totaled $499,517,800 in 1933. This was within 3% of the total of $514,699,700 reported for these types during 1932. Awards for public utilities let during 1933 amounted to $103,204.800. This was a gain of almost 37% over the total of $75,601,500 reported in 1932. CONSTRUCTION CONTRACTS AWARDED-37 STATES EAST OF THE ROCKY MOUNTAINS. New Floor No. of Projects. Spate(Sq.Ft.) Month of December1933-Residential building Non-residential building Public works and utilities Total construction 1932-Residential building Non-residential building Public works and utilities Total construction First 12 Months1933-Residential building Non-residential building Public works and utilities Total construction 1932-Residential building Non -residential building Public works and utilities Total construction Valuation. 1,720 3,189 2,768 5,889,600 5,184,600 377,300 823,899,600 50,040,000 133,289,900 7,677 11,411,500 $207,209,500 1.903 1,383 939 3.437,200 3,330,800 180,700 $12,957,500 24,944,900 43,316,900 4,205 6,948,700 581,219,300 40,479 29,543 15,195 72.782,500 70,387,800 3,883,600 8249,262,100 403,723,700 602,722,600 85,217 147,053,900 $1,255,708,400 38,057 22,823 15.449 73,607,300 79,221,300 2,746,800 5280,067.900 480,789,600 590,301,200 76 120 155 575 400 S1.351.1573.700 NEW CONTEMPLATED WORK REPORTED-37 STATES EAST OF THE ROCKY MOUNTAINS. 1932. 1933. No. of Projects. Month of DecemberResidential building Non-residential building Public works and utilities-Total construction First 12 MonthsResidential building Non-residential building_ _ _ Public works and utilities_ __ Total construction Valuation. No. of Projects. Valuation. 2,180 4,713 3,742 $48,913,800 259,148,700 469,970,100 2,351 2,061 1,090 521,053,400 62,217,300 60,971,100 10,635 $778,030,600 5.502 $144,241,800 47,094 41,236 24,758 $658,604,100 1,508,197,000 3,428,482,800 44,701 28,669 18,185 $410,335,300 560,132,400 867,372,300 113,086 $5,595,283,900 91,555 $1,838,340,000 Silver Mine Raises Pay-Silver King Coalition's 510 Employees Get 50 Cents a Day More. The following from Salt Lake City is from the "Wall Street Journal" of Jan. 19: mining The Silver ICIng Coalition Mines Co., operating in the silver-lead district of Park City, Utah, has raised the wages of its 510 employees 50 car and for $4 miners for day cents a day, giving a wage scale of $4.50 a was men and muckers. M. J. Dailey, General Manager, says the raise made possible by the Government's silver purchase program. mines in the West, The Silver King property is one of the richest silver dividends. In October and in the last half of 1933 resumed payment of and a second of like a dividend of 15 cents was paid totaling $183,000. dividends since amount was made in December. These were the first every quarter. January 1931. For many years the company paid 25 cents Ohio Industrial Employment Increased Fractionally from November to December, According to Ohio State University- Manufacturing Employment Lower. "At 80.4% of the 1926 level, industrial employment in Ohio in December reflected a fractional increase from November," states the Bureau of Business Research of the Ohio State University. "The increase, however," the Bureau says, "was not shared by a majority of the reporting concerns." The Bureau, under date of Jan. 8, further reports: November-December Two hundred and ninety-five firms reported declines, and 98 reported increases in employment, while 371 firms reported increase of 12.9% seasonal no change. This condition was due to the large group, which was of sufIn employment in the retail and wholesale trade manufacturing and construction ficient importance to offset declines in the in December declined groups of industries. Manufacturing employment employment declined 6.2%. 0.9 of I% from November,while construction recorded Novemberindustries Four of the 11 groups of manufacturing in the stone, December employment gains. The larger gains were registered manufacturing groups of Indusday and glass, vehicles, and miscellaneous products, glass industries, tries. Among the individual manufacturing better showing. With few and autos and parts presented the relatively industry classifications exceptions, employment in all of the manufacturing Jan. 20 1934 In December was above December 1932. In the non-manufacturing group, service and transportation and public utilities during December remained below the December 1932 level; retail and wholesale trade, however, reported an increase of 15.1%. Six of the eight chief cities shared in the November-December increase in employment, with Columbus, Toledo, Cleveland, and Dayton reporting the larger percentage increases. All of the eight chief cities reported increases in employment in December from December 1932, the gains ranging from 8% to 61.7%. Industrial employment for the year 1933 was 91% above 1932. Expressed as percentages of employment in 1929, employment in 1930 amounted to 85.7%; in 1931, to 71.8%; in 1932, to 59.4%; and in 1933. to 64.8%. As was indicated in a previous release, these data do not Include figures on Civil Works Administration employment. Second Week of 1934 Continues Advance in Lumber Orders Over Preceding Six Weeks. New business booked at the lumber mills made another gain during the second week of 1934, the total exceeding that of any of the preceding six weeks and production was heavier than during the preceding two holiday weeks according to telegraphic reports to the National Lumber Manufacturers Association covering the operations of leading hardwood and softwood mills. The reports were made by 1,115 American mills whose production was 135,726,000 feet; shipments, 113,887,000 feet; orders, 125,694,000 feet. Revised records of 1,134 mills the previous week showed production 121,913,000 feet; shipments, 94,356,000 feet; orders, 109,278,000 feet. The Association further stated: During the week ended Jan. 13 1934 all softwood regions but West Coast and California Redwood reported orders above production, total softwood orders being only a fraction of 1% below production. Hardwood orders however were 46% below output; total lumber 7% below production. All regions but Southern pine and Southern hardwoods reported orders above those of corresponding week of 1933, total softwood orders being 8% above those of last year; hardwood orders 16% below those of the 1933 week. The production of the current week was 34% above that of corresponding week of 1933; shipments were 4% above those of last year and total orders 6% above those booked during the 1933 week. Unfilled orders on Jan. 13, on the new three-year average basis, were the equivalent of 18 days' average production of reporting mills compared with 19 days' on corresponding date of 1933. Forest products carloadings totalled 14,878 cars, during the week ended Jan. 6 1934, which was an increase of 3,183 cars over the preceding week, a gain of 2,465 cars over the same week of 1933 but a decrease of 1,943 cars as compared with similar week of 1932. Lumber orders reported for the week ended Jan. 13 1934 by 787 softwood mills totaled 114,317.000 feet, or 0.3% below the production of the same mills. Shipments as reported for the same week were 102,692,000 feet, or 10% below production. Production was 114,701,000 feet. Reports from 353 hardwood mills give new business as 11,377,000 feet, or 46% below production. Shipments as reported for the same week were 11,195.000 feet, or 47% below production. Production was 21,025,000 feet. Unfilled Orders and Stocks. Reports from 1,172 mills on Jan. 13 1934 give unfilled orders of 526,850,000 feet and 1,156 mills report gross stocks of 4,176.590.000 feet. The 507 identical mills report unfilled orders as 430,236,000 feet on Jan. 13 1934, or the equivalent of 18 days' average production, as compared with 445,442,000 feet, or the equivalent of 19 days' average production on similar date a year ago. Identical Mill Reports. Last week's production of 388 identical softwood mills was 107,249,000 feet, and a year ago it was 83,704,000 feet; shipments wore respectively 94,690,000 feet and 86,784,000 feet; and orders received 105,001,000 feet and 96,885,000 feet. In the case of hardwoods, 189 identical mills reported production last week and a year ago 14,647,000 feet and 7,248,000; shipments 6,839,000 feet and 10,535.000 and orders 7,469,000 feet and 8,922,000 feet. SOFTWOOD REPORTS. West Coast Movement. The West Coast Lumbermen's Association reported from Seattle that for 489 mills in Washington and Oregon and 22 in British Columbia, shipments were 29% below production. and orders 11% below production and 25% above shipments. New business taken during the week amounted to 74,017,000 feet (previous week 61,460,000 at 509 mills); shipments 59,261,000 feet (previous week 50,958,000); and production 83,353,000 feet (Previous week 68,126,000). Orders on hand at the end of the week at 489 mills were 295,084.000 feet. The 184 identical mills reported an Increase in production of 39% and in new business a gain of 17% as compared with the same week a year ago. Southern Pine. The Southern Pine Association reported from New Orleans that for 123 mills reporting, shipments were 19% below production, and orders 3% above production and 27% above shipments. Now business taken during the week amounted to 23,551,000 feet (previous week 14,606,000 at 126 mills); shipments 18,560,000 feet (previous week 12,501,000): and Production 22,946,000 feet (previous week 21,105,000). Orders on hand at the end of the week at 84 mills were 49,403,000 feet. The 84 identical mills reported a decrease in production of 6%, and in new business a loss of 14%, as compared with the same weak a year ago. Western Pine. The Western Pine Association reported from Portland, Ore., that for 117 mills reporting, shipments were 63% above production and orders 41% above production and 13% below shipments. New business taken during the week amounted to 23,009,000 feet (previous week 26,602,000 at 133 mills); shipments 26,550,000 feet (previous week 24.243,000), and production 16.331.000 feet (previous week 17,565,000). Orders on hand at the end of the week at 117 mills were 25,494,000 feet. The 98 identical mills reported an increase in production of 43%, and in now business a gain of 9%, as compared with the same week a year ago. Northern Pine. The Northern Pine Manufacturers of Minneapolis, Minn., reported production from 17 American mills as 308,000 feet, shipments 1.188.000 feet and new business 794,000 feet. Orders on hand at the end of the week were 3,593,000 feet. Financial Chronicle Volume 138 California Redwood. The California Redwood Association of San Francisco reported production from 16 mills as 4,514,000 feet, shipments 6,725,000 feet and orders 3.866,000 feet. Orders on hand at the mills at the end of the week were 33.209,000 feet. Nine identical mills reported production 10% greater and new business 5% greater than for the same week last year. Northern Hemlock. The Northern Hemlock & Hardwood Manufacturers Association of Oshkosh, Wis., reported softwood production from 25 mills as 558.000 feet. shipments 715,000 and orders 1.079,000 feet. Orders on hand at the end of the week at 11 mills were 2,828,000 feet. The 13 identical mills reported a gain of 45% in production and a gain of 65% In new business, compared with the same week a year ago. HARDWOOD REPORTS. The Hardwood Manufacturers Institute of Memphis, Tenn., reported production from 328 mills as 18,875,000 feet, shipments 10,169,000 and new business 10,494,000. Orders on hand at the end of the week at 433 mills were 111,482,000 feet. The 176 identical mills reported production 86% greater and new business 18% less than for the same week last year. The Northern Hemlock & Hardwood Manufacturers Association of Oshkosh, Wis., reported hardwood production from 25 mills as 2.150,000 feet, shipments 1,026,000 and orders 883.000 feet. Orders on hand at the end of the week at 16 mills were 5,757,000 feet. The 13 identical mills reported a gain of 722% in production and a gain of6% in orders, compared with the same week last year. Changes in the Cost of Living June to December 1933Index of United States Department of Labor Increased 5.2% During Period. The United States Department of Labor's general index of the cost of living for families of wage earners and lower salaried workers registered an increase of 5.2% during the six months' period ending December 1933, according to an announcement made Jan. 12 by Isador Lubin, Commissioner of the Bureau of Labor Statistics. The index, based on the average for the year 1913 as 100.0, was 135.0 for December as compared with 128.3 for June 1933, and 132.1 for December 1932. The survey made by the Bureau covers 32 cities widely scattered throughout the United States. In issuing the survey, Mr. Lubin stated: The cost of every group of items included in the cost of living budget, except rents,showed an increase during the six months' period. The largest rise occurred in the household furnishing goods group, where there was an Increase of 11.6% between Juno and December. Clothing costs advanced by 11.5%, food by 9.1%,fuel and light by 7.2% and miscellaneous items, which include medical and dental services, drugs, laundry, transportation, &c., by slightly less than 1%. Rents declined by 4.3%• The survey follows: Percent of Decrease From. Percent of Increase From. City. June 1920 to Dec. 1929 to Dec. 1932 to June 193310 Dec. 1933. Dec. 1933. Dec. 1933. Dec. 1933. Atlanta Baltimore Birmingham Boston Buffalo Chicago Cincinnati Cleveland Denver Detroit Houston Indianapolis Jacksonville Kansas City Los Angeles Memphis Minneapolis Mobile New Orleans New York Norfolk Philadelphia Pittsburgh Portland, Me Portland, Ore Richmond San Francisco Savannah Scranton Seattle St. Louis Washington 40.6 33.8 41.5 36.4 35.9 40.0 34.5 38.7 38.7 45.5 39.1 38.6 38.7 40.7 34.6 36.9 35.6 37.3 33.6 35.2 36.7 35.3 36.8 34.2 40.2 34.9 32.9 39.7 32.6 35.8 37.1 34.6 23.3 19.0 25.8 20.4 21.1 25.9 21.8 20.0 20.6 27.6 23.0 22.4 19.9 19.9 21.8 20.7 20.5 21.2 20.7 19.8 19.0 21.0 23.5 17.6 21.0 18.5 18.2 19.7 19.8 19.9 23.0 17.3 5.2 6.0 5.6 5.3 4.8 3.8 4.1 3.9 3.0 6.4 5.6 4.7 7.4 2.5 4.9 5.0 5.2 6.3 5.1 4.9 8.0 6.2 4.5 6.0 3.7 6.5 4.9 8.4 6.5 2.0 3.7 6.5 3.0 2.8 2.1 2.8 1.6 0.4 0.8 1.9 0.5 2.4 5.1 1.9 4.1 -0.2 3.1 3.1 1.5 1.4 3.0 3.2 0.1 3.3 -0.2 3.5 2.1 3.5 2.6 1.0 1.2 4.6 Per Cent of Per Cent of Decrease From. Per Cent ofIncrease From. Inc. From 1929 to Dec. 1932 to1June 1933 to 1 June 1920 toDee. 1913 to Dec. 1933. Dec. 1933. Dec. 1933. Dec. 1933. Dec. 1933. United States__ No change. 37.6 35.0 5.2 2.2 21.2 TABLE 2-PER CENT OF INCREASE (+) OR DECREASE (-) JUNE 1933 TO DECEMBER 1933. City. Food. Clothing. House .40 Furn. Aftsce1Goods. laneous. Items. Rent. Fuel and Light. +12.0 +15.6 +7.9 +11.6 +13.3 +14.3 +4.3 +12.9 +3.7 +10.1 +10.1 +10.8 +9.8 +9.6 +9.3 +2.3 +8.5 +10.7 +7.8 +11.7 +9.7 +2.5 +10.7 +11.8 +3.7 +19.2 +1.0 +10.5 -3.0 +14.4 +8.9 +10.8 +7.4 +11.5 +10.8 +14.4 +17.5 +14.0 +4.2 +12.1 +11.0 +11.7 +7.9 +15.8 +3.2 +12.5 +4.6 +6.8 +9.7 +13.0 +8.4 +15.3 +13.2 +10.5 +9.7 +0.6 +4.9 . +7.7 +10.4 +10.8 +9.0 +1.1 +4.0 +11.2 +1.5 +0.3 +1.2 +0.6 +0.3 -0.1 +1.0 +0.3 I +1.4 -0.2 +0.5 +1.3 -0.5 -0.3 +1.6 -0.7 +1.5 -0.1 -0.5 +4.0 +0.8 +0.7 +1.9 -0.2 +1.6 +0.2 +0.9 I +1.2 x +1.2 +5.2 +6.0 +5.6 +5.3 +4.8 +3.8 +4.1 +3.9 +3.0 +6.4 +5.6 +4.7 +7.4 +2.5 +4.9 +5.0 +5.2 +6.3 +5.1 +4.9 +8.0 +6.2 +4.5 +6.0 +3.7 +7.5 +3.7 +4.9 +6.4 +6.5 +2.0 +6.5 +11.6 +0.7 +6.2 Atlanta Baltimore Birmingham.-Boston Buffalo Chicago Cincinnati Cleveland Denver Detroit Houston Indianapolis Jacksonville __ _ _ Kansas City__ Los Angeles Memphis Minneapolis Mobile New Orleans New York Norfolk Philadelphia_..._ Pittsburgh Portland, MePortland, Ore,_ Richmond St. Louts San Francisco_ Savannah Scranton Seattle Washington +5.8 +12.1 +5.9 +3.3 +9.7 +6.7 +8.5 +10.5 +6.2 +11.1 +11.2 +7.3 + 13.5 +4.1 +11.5 +10.5 +13.4 +9.2 +11.6 +9.9 +14.8 +11.8 +11.2 +8.1 +4.4 +12.5 +7.3 +5.8 +13.6 +11.6 +1.7 +9.5 +13.2 +12.1 +15.3 +12.0 +11.3 +10.3 +7.3 +7.6 +7.4 +13.3 +11.2 +11.2 +12.9 +9.9 +12.8 +10.7 +11.3 +12.4 +8.6 +12.0 +11.0 +10.7 +8.4 +13.6 +10.1 +14.0 +12.0 +15.9 +13.5 +12.7 +10.3 +15.4 -5.7 -4.1 -3.3 -3.7 -4.1 -6.1 -2.2 -4.7 -5.0 -5.5 -1.3 -3.0 -2.2 -2.7 -5.2 -5.1 -3.6 -3.2 -4.0 -4.6 -7.5 -4.2 -3.4 -2.9 -4.3 -7.8 -5.8 -3.3 -3.3 -2.8 -4.5 -2.5 Average U.S____ No change. +9.1 +11.5 -4.3 +7.2 TABLE 3.-COST OF LIVING INDEX NUMBERS BY GROUPS OF ITEMS. DECEMBER 1933, BASED ON AVERAGE FOR DECEMBER 1927, AND JUNE 1928, FIGURES EQUALING 100.0. City. Atlanta Baltimore Birmingham_ -- Boston Buffalo Chicago Cincinnati Cleveland Denver Detroit Houston Indianapolis Jacksonville Kansas City Los Angeles Memphis Minneapolis Mobile New Orleans New York Norfolk Philadelphia_ _ -Pittsburgh Portland, Me Portland, Ore Richmond St. Louis San Francisco_ _. Savannah Scranton Seattle Washington ATrarocra TT <I House Purrs. 1lfiscelGoods. laneous. Food. Clothing. Rent. Fuel and Light. cl°110°"qq"c!eitilei4""""Rgagclm.Rw .pcivc-dmr-464r:Mcge —,c; towwcwvoct-ommwwcopyygo4Z99.0mcpyrapeinc; mncoptogpmeacontomr-t o In the 32 cities covered the greatest rise occurred in Norfolk, Va., where living costs advanced by 8%. Jacksonville, Fla.,showed the second largest net gain by increasing 7.4%. Washington, D. C., Richmond, Va., and Scranton, Pa., showed an advance of 63.5%. Other cities increasing 6% or more were Baltimore, Detroit, Mobile, Philadelphia, Portland. Me., and Savannah. Seattle with a rise of only 2% showed the smallest increase for anyff the 32 cities covered. During the six months' period rents declined in all of the 32 cities covered. The decreases ranged from 1.3% in Houston, to 7.8% in Richmond. The miscellaneous group of items included in the index showed decreases in eight of the 32 cities covered. There was no change in three of the cities and increases were shown in 21 cities. Those advances ran from 0.2 of 1% In St. Louis to 4% in Norfolk. Fuel and lighting costs showed advances in all cities but one. These Increases ranged from approximately of 1% in San Francisco to 17;i% In New Orleans. Los Angeles, with a decline of 3%. was the only city showing a decrease. Food costs showed advances in all cities covered by the Bureau. The smallest increase was reported for Seattle, where they rose by slightly more than 1% %. Cities which increased 12% or more were Baltimore, Jacksonville, Minneapolis, Norfolk, Richmond and Savannah, with Norfolk showing the graetest rise, which amounted to nearly 15%. Clothing, which increased by an average of 1155 %, showed marked advances everywhere. The smallest increases, slightly more than 7% occurred in Cincinnati and Denver. The largest was shown for San Francisco, where clothing prices moved upward by 16%• The increases for the housefurnishings group, where the greatest average rise took place, varied from less than 7% in Portland, Me., to more than 19% in Jacksonville, Fla. Comparing December 1933 with December of a year ago, the general index shows an increase of 2.2%. Among the 32 cities covered. Houston, Texas, shows the greatest increase over the year with an advance of 5.1%. The next largest increase during the period, was shown for Washington, D. C., whore the index advanced by 4.6%. Jacksonville, where there was a rise of 4.1% was the only other city where the index increased by more than 4%. Kansas City was the only city showing no change in the general level during the 12 months. Three cities showed minor decreases as follows: Los Angeles and Portland, Ore., 0.2 of 1%,and Minneapolis, 0.1 of 1%. When compared with the average for December 1927, and June 1928, the general cost of living index for the United States for December 1933,shows a decrease of 21.1%. Detroit, Mich., and Birmingham. Ala., experienced the largest decrease with a fall of 27.6%. The smallest decrease occurred in Portland. Mo., where living costa for the average wage earner's family fell by 17.4%. During this period rents fell by 34.5% for the country as a whole. Food declined by 31.6%, housefurnishings by 18.8%. clothing by 17.9%.fuel and light by 11.6%. Miscellaneous items showed a decrease of 4.6%. Of all the important items in the family budget, rent showed the largest average decrease since the first half of 1928. The decreases ranged from 56.9% in Birmingham, Ma., to approximately 14% in Washington, D. C. The drop in food prices varied from 36% in Atlanta, Ga., to 27.1% in San Francisco. During this same period the largest decline in the cost of household furnishings took place in Birmingham, where a fall of 26.2% was registered. In Portland, Me.,the decrease was 12.9%. Clothing costs fell most markedly in Chicago, where a drop of 23.8% occurred. Mobile. Ala., showed the smallest decline, 11%. Fuel and light costs declined by 27.1% in Mobile, as contrasted with an actual rise of 1% in Cincinnati. Miscellaneous items remained virtually 401 unchanged in Baltimore, St. Louis and Washington, D. C.. where decreases of less than 1% were shown. In Detroit they dropped by 10.9%, while in Portland, Me., an increase of 3.5% occurred. The following tables show changes in the cost of living in December 1933, as compared with specified preceding dates, and for the several groups of items. TABLE 1-CHANGES IN COST OF LIVING AS BETWEEN SPECIFIED DATES, ALL ITEMS COMBINED. 83.9 82.8 85.9 86.8 81.6 76.2 79.6 80.6 79.1 83.5 77.1 79.0 81.4 82.2 82.1 87.6 80.9 89.0 78.1 79.1 84.9 77.3 80.7 83.9 80.7 87.6 79.6 87.1 85.4 82.3 84.0 81.3 63.8 74.4 43.1 77.0 66.2 54.2 70.7 61.6 67.3 46.1 62.5 62.5 51.1 70.8 574 59.8 72.9 64.8 74.5 76.0 75.3 66.5 61.7 84.9 58.8 75.4 59.1 73.6 84.0 73.3 66.0 85.7 77.5 95.6 81.9 88.7 96.4 90.9 101.0 97.5 80.8 84.6 80.8 95.9 85.7 84,8 88.6 85.3 90.4 72.9 76.8 92.4 86.5 94.5 97.8 87.0 85.3 85.6 89.7 85.0 90.5 85.8 92.9 91.9 83.9 80.6 73.8 82.0 81.6 74.9 82.8 78.6 81.6 79.9 82.5 80.8 82.0 82.1 78.2 82.5 84.6 84.4 84.4 78.0 83.9 78.6 77.5 87.1 82.3 83.9 79.8 81.1 81.7 82.4 84.8 85.2 92.5 99.8 91.1 97.0 92.4 95.3 97.1 97.9 98.1 89.1 95.4 92.5 90.2 97.9 89.8 95.8 94.4 95.6 94.4 95.0 97.5 93.1 95.3 103.5 94.6 94.3 99.5 96.2 94.2 98.0 93.7 99.1 76.3 81.5 72.4 80.2 79.1 74.4 79.5 78.5 79.6 72.4 77.9 77.7 77.8 80.2 78.0 79.0 79.9 78.9 79.1 80.4 81.5 78.2 76.3 82.6 79.0 80.8 77.6 82.4 80.2 80.0 81.2 82.1 RR e 521 as a RR 4 RI o Oh 4 789 AR Items. 402 Financial Chronicle Congratulates Automobile President Roosevelt Industry for Part in National Recovery-Message to Leaders Notes Production Gain of 46% in 1933 and Hopes for Still Greater Progress. A message from President Roosevelt, commenting on the 46% rise in automobile production in 1933 and congratulating leaders of the automobile industry on their contribution to recovery, was read at the annual banquet of the National Automobile Chamber of Commerce in New York City on Jan. 9. The President wished the industry "still greater progress during 1934 and future years." The message follows: To Members of the National Automobile Chamber of Commerce: I welcome this opportunity to express to you of the automotive industry my appreciation of the contribution you have made to National Recovery. I realize that this contribution was made in spite of handicaps which might have proved literally crushing to men of less dauntless spirit than was demonstrated by the leaders of the automotive industry. The Department of Commerce advises me that the production figures of your industry in the United States during the year just closed will show an increase of approximately 46% over 1932, and it is possible that registrations of motor vehicles will show an even greater gain. Your exports, valued at $82,000,000 In 1932. I am advised, exceeded that total in the first 11 months of 1933. Such improvement in this industry is particularly significant because it has an immediate and beneficial effect upon many other manufacturing industries. It has also made possible the giving of gainful work to many unemployed. I extend sincere congratulations for all that has been accomplished in the past and wish for you still greater progress during 1934 and future years. Very sincerely yours, FRANKLIN D. ROOSEVELT. Wheat Adjustment Payments Totaled $26,977,359 Up to Jan. 13-Growers in 35 States Receive AAA Checks. A total of $26,977,359 in checks were written up to Jan. 13 for farmers co-operating in the nation-wide wheat adjustment program, the Agricultural Adjustment Administration announced. There have been 362,897 checks written and sent to wheat growers in 35 States. In its announcement the AAA further said: The payments to date are part of the total approximating $70,000,000 which will be paid this winter to growers who signed agreements to reduce their wheat acreage by 15%. Total payments to be made to co-operating wheat farmers this winter and next summer are expected to reach $102,000,000. The present week has seen the beginning of adjustment payments to farmers in North Dakota and Montana, and two large wheat States which up to this time have not received payments. Most of the payments yet to be made are scheduled to go to these States and to the Pacific Northwest in Washington. Oregon and Idaho. The total payments to States to date are: Arizona 811,622 Minnesota 129,827 Oregon 99,564 California 340.214 Missouri 842,773 Pennsylvania __ 1,168,414 Colorado 736.915 Montana 33,549 South Dakota__ 2,471,936 Delaware 56,751 Nebraska 1,232,117 Tennessee 76,687 Idaho 199,202 NewJersey _ 6,808 Texas 2,082,807 Illinois 1,286,220 New Mexico_ 198,268 Utah 263,502 Indiana 1,101.326 New York 13,345 Virginia 343.961 Iowa 224,695 Nevada 15,985 Washington____ 485,507 Kansas 10.297.761 North Carolina_ 26,200 West Virginia-15,282 Kentucky 140,370 North Dakota_ 186.661 Wisconsin 45,935 510.486 Ohio 1 042,775 Wyoming Maryland 44,869 431,914 Oklahoma Michigan 1,226,288 Wheat Export Sales of North Pacific Emergency Export Association Near 10-Million-Bushel Mark. Sales of nearly 10 million bushels of Pacific Northwest wheat or wheat in the form of flour have been completed by the North Pacific Emergency Export Association in the program to reduce surplus supplies in Washington, Oregon and Idaho, Frank A. Theis, chief of the grain processing and marketing section of the Agricultural Adjustment Administration, announced on Jan. 11. The Administration further said: Purchases for export are equivalent to 10,750.000 bushels of wheat. Of this amount 9,950,000 has been sold and approximately 5,500,000 bushels already have been shipped by the Association. The Association was formed under a marketing agreement which provides that exporters are to be reimbursed by the AAA the difference between the price paid for wheat bought at the domestic price and the lower world price level at which this wheat is sold. The average differential payment between purchases and sales to date has been about 21 cents a bushel, Mr. Theis said. The 10 million bushels of wheat bought to date represents about a third of the amount contemplated at the time the marketing agreement was entered into, Mr. Theis said! The emergency program has not only offered tremendous relief to Pacific Northwest producers in disposing of their surplus supplies, but it has prevented the low price competition of that wheat from depressing domestic prices throughout the rest of the United States, Mr. Theis said. The operation of the Emergency Export Association illustrates graphically the dependence of the American farmer on an export outlet when a surplus above domestic needs is produced. As an illustration, the lowest price at which the Association has been compelled to sell any wheat to meet world competition on the Pacific Coast was 47 cents a bushel, f.o.b. steamer at Portland, on Dec. 21. In order to meet such competition, if a Kansas producer was shipping his wheat for export this year, using an ,originating point like Dodge City, Kan., as an example, this price figured back from Galveston or New Orleans for export would have netted the Kansas producer 20 cents a bushel on cars at Dodge City. Assuming a premium of 5 cents a bushel for Kansas wheat over Pacific Coast prices in the export market, this would still net the Kansas farmer only 25 cents a bushel; whereas No. 2 hard wheat sold on the same date in the Kansas City market at a price which figures back to Dodge City of 6234 cents a bushel. or 37.3i cents more than the export price. . Jan. 20 1934 Wheat sales have been for shipment to China, Japan, Holland, Belgium. Ireland, England, and several South and Central American countries. Flour sales have been more diversified and have been for shipment to Scotland, Nicaragua, Guatemala, Sandwich Islands, Honduras, England. Virgin Islands, Federated Malay States, Finland, Philippine Islands, Ecuador, Haiti, Manchuria, Jamaica, French Indo-China, Norway, Singapore, Costa Rica, China, Salvador, Japan, New Zealand, Sumatra, Holland, Dutch East Indies and Egypt. An earlier reference to the Pacific wheat exports appeared in our issue of Nov. 25, page 3740. W. H. English Jr. Re-elected President of New York Coffee & Sugar Exchange-Others Elected. William H. English Jr. was re-elected President of the New York Coffee and Sugar Exchange at the annual elections Jan. 18 and still holds the distinction of being the youngest President of any of the city's commodity or security markets, it was announced by the Exchange on Jan. 19. This will be his second year in office. Mr. English, who is now 34 years old, is a partner of C. D. Halsey & Co. He is also a director of C. W. Young & Co. Others elected were announced as follows: Chandler A. Mackey was re-elected Vice-President and Earl B. Wilson was re-elected Treasurer. Mr. Phillips R. Nelson was elected as a new member of the board of managers. In addition to its new member and the officers, the board for 1934 will include Messrs. Harold L. Bache, William G. Daub, Frank G. Henderson, F. R. Home, Jerome Lewine, E. L. Lueder, W. W. Pinney, C. C. Riggs, M. E. Blonde, A. M. Walbridge and W. J. Wessels. The nomination of the new officers and members of the board of managers was referred to in our issue of Jan. 13, page 233. New Bids on Brazilian Coffee to Be Received Jan. 30. New Bids on a monthly quota of 62,500 bags of Santos coffee, which was acquired from Brazil in exchange for American wheat, will be opened on Jan. 30. Earlier this month (Jan. 9) the Grain Stabilization Corporation rejected bids on a quota of 62,500 bags. Reference to this was made in our issue of Jan. 13, page 233. Destruction of Coffee in Brazil Less During First Fifteen Days of January. Coffee destruction in Brazil during the first fifteen days of the new year amounted to only 112,000 bags, according to cables to the New York Coffee & Sugar Exchange. This is the smallest fortnightly total since the fall of 1932 when the civil war in that country interfered with the work of destroying the surplus, the Exchange announced. Since June 1931, 26,177,000 bags have been destroyed-7,852,000 of that total since July 1 1933, or at the rate of more than a million a month during the last half of 1933. Coffee to Continue Rise, Brazilian Dealers Assert. A cablegram from Rio de Janeiro, Jan. 18, to the New York "Times"said: Brazilian coffee exporters predict that prices will continue to rise because of the destruction so far of 26.000,000 bags of Brazilian coffee and the crop shrinkage in Brazil and other countries. Coffee dealers said they did not expect the market would suffer from the tripling of French coffee duties. The crop shrinkage and increasing exports to the United States and Great Britain would balance the loss in the French market, they predicted. Exports of Coffee from Colombia in November Highest Since August. November coffee exports from Colombia were the highest for any month since August, according to a report to the United States Commerce Department from its Bogota office. Of the 257,362 bags shipped during the month, 199,654 bags went to the United States, 51,413 to Europe, and 6,295 to other countries, the Department announced, adding: Total coffee exports during the 11-month period ended Nov.30 amounted to 3,048,826 bags compared with 3,184,328 bags for the full year 1932. If weather conditions permit shipment of coffee to ports, the report states, it is believed locally that the 1933 exports will exceed those for 1932 by approximately 150,000 bags. Movement of coffee to ports during the month of November amounted to 272,000 bags compared with 216,000 bags in October and 237.000 bags in September. Exports of coffee during the months of September and October, It is pointed out, dropped below the monthly average, due to heavy rains which did not permit gathering of coffee or the movement to ports. Grant PWA Loan to Aid Sugar Trade-$1,000,000 SelfLiquidating Advance Made for Benefit of Industry of Virgin Islands. From Washington Jan. 15 the New York "Journal of Commerce" reported the following: Approval of an allotment of $1,000,000 to benefit the sugar and rum industry in the Virgin Islands on a self-liquidating basis was announced to-day by Secretary of the Interior Ickes, Public Works Administrator. The fund is to be administered under the direction of the Secretary through such agencies as he may designate and is intended to be used to benefit the local sugar industry and various sugar processing steps. It was explained Financial Chronicle Volume 138 that this may be done through establishment of regulated co-operatives, buying, leasing, or through such other means as are found suitable. When the project is completed, it is contemplated that the processing machinery or acreage be sold or leased to competent private interests or the municipality of St. Croix on an amortization basis which will provide repayment to the Government, the PWA stated. The Administration pointed out that for over 150 years St. Croix has engaged largely in production of sugar and its processing, including the manufacture of rum. Exports of Raw and Refined Sugar to United States from Philippines During Period from Nov. 1 to Dec. 31 Below Year Previous. Raw sugar exports to the United States from the Philippines from Nov. 1 to Dec. 31 amounted to 188,215 tons, against 194,525 tons exported during the same period in 1932, a decrease of 3.2%, according to cables received by the New York Coffee and Sugar Exchange. The Exchange announced on Jan. 10 that refined shipments for the same period totaled 10,245 tons, against 11,191 tons in 1932, a decrease of 9.5%. Shipments from Dec. 16 to 31, raw and refined, were 56,868 tons in 1933 against 80,054 during the last half of December 1932, the Exchange said. Sugar Shipped by Puerto Rico for First Time Since End of October-9,356 Short Tons Sent to New York and 9,756 to Gulf Ports. Puerto Rico's sugar shipments to the United States for the week ended Jan. 13, consisting of 9,356 short tons of raw sugar for New York and 9,756 tons of refined to Gulf ports, were the first shipments since the end of October, according to cables to the New York Coffee and Sugar Exchange. The absence .of shipments was due to the fact that all the sugar on the island had been sold, the Exchange announced, adding: From Jan. 1 to 14 last year 14.309 tons of raws and 4,700 tons of refined had been shipped to this country. The 1934 crop is estimated at 876,000 long tons, an increase of 131,000 tons over the 1933 production, but labor troubles in Puerto Rico, still unsettled, have delayed shipments of the new crop. Census Report on Cottonseed Oil Production During December. On Jan. 13 the Bureau of the Census issued the following statement showing cottonseed received, crushed and on hand, and cottonseed products manufactured, shipped out, on hand and exported for one month ended Dec. 31 1933 and 1932: COTTONSEED RECEIVED, CRUSHED AND ON HAND (TONS). Received at Mills* Crushed Aug. 1 to Dec. 31. Aug. 1 to Dec. 31. On Hand at Mills Dec. 31. State. 1933. Alabama Arizona Arkansas California Georgia Louisiana Mississippi North Carolina Oklahoma South Carolina Tennessee Texas All other States United States 1932. 182,027 188,042 30,483 21,782 281,659 321,398 71,596 43,768 264,465 233,412 125,594 151,662 413,490 446,700 186,817 167,605 340,191 315,118 126,412 132,912 259,760 363,050 1,162,123 1,189,250 60,393 49,095 1933. 1932. 1933. 1932. 126,597 17,849 190,858 41,917 205,131 85,367 225,640 141,665 253.114 105,977 197,082 797,743 36.566 150,990 27,136 199,762 32,397 182,467 113,405 283,349 124,235 237,665 120,824 217,125 861,828 35,494 58,394 12,845 106,791 32,606 70,825 42,805 199,587 45,657 114,359 21,071 107,950 463.683 23,869 47,146 1,744 129,444 16,626 61,402 40.595 187,648 48,159 117,256 14,385 155,290 502,690 14,016 3 505.010 3.623.794 2.425.506 2.586.677 1.300.442 1.336 391 •Includes seed destroyed at mills but not 220,938 tons and 300,024 tons on hand Aug. 1, nor 20,751 tons and 29,436 tons reshipped for 1933 and 1932 respectively. COTTONSEED PRODUCTS MANUFACTURED, SHIPPED OUT, AND ON HAND. Item. Season. On Hand Aug. 1. Produced Aug. 1 to Dec. 31. Shipped Out Aug. 1 to Dec. 31. On Hand Dec. 31. Crude oil, lbs___ 1933-34 *51,269,417 749,832,880 650,552,460 *168,849,941 1932-33 29,523,581 796,376,046 714,951.243 143,902,011 Refined oil, lbs_ 1933-34 a 676,331,574 b566,728,460 a769,234,854 1932-33 628,420,148 605,953,198 730,495,676 Cake and meal, 1933-34 1,095,766 944,544 160,874 312,096 tons 1932-33 1,163,972 911,339 114,656 367,289 Hulls, tons 1933-34 651,477 603,271 76,686 124,892 1932-33 733,217 162,773 660,670 235,320 Linters, running 1933-34 437,145 346,107 70.786 161,824 bales 1932-33 235,521 409,029 360,233 284,317 Hull fiber, 500- 1933-34 28,180 24,933 985 4,232 lb. bales 10,404 1932-33 4,138 5,208 9,334 Grabbots,motes, &o., 500-lb., 1933-34 19,412 14,407 3,216 8,221 bales 14,427 1932-33 12,084 15,260 17,593 •Includes 4,274,646 and 18,190,330 pounds held by refining and manufacturing establishments and 14,320,860 and 18,705,280 pounds in transit to refiners and consumers Aug. 1 1933 and Dec. 1 1933. respectively. a Includes 5,498,953 and 5,150,737 pounds held by refiners, brokers, agents, and warehousemen at places other than refineries and manufacturing establishments and 12,642,917 and 8,303,576 pounds in transit to manufacturers of lard substitutes, oleomargarine, soap, dm. Aug. 1 1933 and Dec. 31 1933, respectively. Produced from 615,585,845 pounds of crude oil. EXPORTS OF COTTONSEED PRODUCTS FOR FOUR MONTHS ENDING NOV. 30. Item, 011-Crude, pounds Refined Cake and meal, tons of 2,000 pounds Linters, running bales 1933. 5,765,559 1,815,469 37,830 48,802 1932. 9,277,923 2,655,859 59,784 52,164 403 Netherland India's Sugar Industry in Critical Position. That the sugar industry of Netherland India, ordinarily looked on as an index of the general economic position of that country, is at present in a depressed condition is revealed in a report to the Commerce Department from Trade Commissioner C. E. Brookhart, Batavia. The Department in announcing this Dec. 28 added: At the end of the third quarter of the current year, the report shows. there was more than 3,000,000 metric tons of sugar on hand. In spite of a large reduction in this year's crop, which amounted to only 1,400,000 metric tons, smaller exports failed to even approximately equal the output since the beginning of the crop year on April 1. The failure of this year's greatly restricted sugar crop to reduce the excessive stocks on hand has been a big disappointment to the Netherland India industry, the report states. Next year's crop will be curtailed so as to produce only between 500,000 and 600.000 tons. It is not believed that the restricted crop will eliminate the tremendous stocks on hand. For this reason there is under consideration a plan to entirely eliminate planting next year for the 1935 harvest in order to permit the disposal of these stocks. If such procedure were carried out, it is anticipated that a normal production of approximately 1,500,000 tons per year could be resumed and the whole industry stabilized upon this basis. Such action as this obviously means further continued unemployment and restricted purchasing power in the important sugar areas for some time to come. It is believed locally, however, that lack of some such readjustment means disaster for the sugar industry of the country. Many mills have already closed down or will in the future discontinue operation as a result of the restriction program. Weekly Wages of Silk Weavers Increased 32% Under President Roosevelt's Code Agreements. An increase of 32% in weekly wages paid to silk weavers since the silk industry came under President Roosevelt's code agreements was reported by the Silk Code Authority, which has recently completed an industry-wide wage survey following the weekly meeting of the code committee. To earn these increased wages this group of employees worked 22% less hours than before the National Recovery Administration agreements went into effect, the Code Authority said. Weavers represent approximately one-third of all workers engaged in the manufacture of silk fabrics. The Authority added: In every State covered by the survey, both in the North and the South, purchasing power of silk weavers was substantially increased during the period from June to November, and this Increase was accompanied by a sharp advance in the hourly wage rates. Actual weekly wage increases ranged from 4% to 67%, varying according to the scale of wages paid prior to the time when the silk code went into effect. The greatest increases came in sections where the lowest wages had been paid. Further Curtailment of Production not Being Sought by Silk Textile Industry. The Silk Textile Industry will not apply to Administrator Hugh S. Johnson for further curtailment of production at the present time, it was learned following the weekly meeting of the Silk Code Authority. An announcement issued by the Federated Textile Industries, Inc. had the following to say regarding the meeting: Wage differentials to be maintained under the President's executive order issued when the Silk Textile Code was signed were discussed at the Silk Code Authority meeting. In order td clarify questions in the minds of mill operators regarding these wage differentials, the Code Authority ruled that they should be based an the standard silk mill operations of winding, quilling, warping, weaving and loom fixing, and not on some minor operation. Each employer is required to see that the differentials between the standard operations in force in his establishment on July I are maintained. Refusal to comply with requests for statistical information requested by the Silk Code Authority is a direct violation of the Silk Textile Code,it was pointed out at the meeting. The attention of all firms subject to the provisions of the Code is called to this requirement. Sales of Domestic Cotton Cloth During Week of Jan. 13 Largest in Many Weeks, According to New York Cotton Exchange. The domestic cotton cloth market was very active during the week of Jan. 13, according to the New York Cotton Exchange Service, and sales of cloth were the largest in many weeks. As measured in aggregate yardage, the volume of cloth business Placed with mills was probably somewhat in excess of current production. On some lines of medium and light weight cloths, sales were estimated to have exceeded production by fully 50%. In heavy goods, business was only of moderate proportions, but this was more than offset by the pronounced activity in other lines of goods. Under date of.Jan. 15, the Exchange Service further announced: Cloth prices strengthened all along the line last week, reflecting the upturn in raw cotton values, the increased demand for cloths, and the sound statistical position that mills have effected as a result of restricting production during December. Advances ranging front an eighth of a cent to a full cent a yard were reported. As a result of the active cloth business since the turn of the year, stocks of unsold goods at mills have been reduced quite generally, and substantial additions have been made to unfilled orders on mill books. While fine goods mills are continuing to restrict operations during January to a maximum of 60 hours a week, the majority of mills have decided to step up production from the low December level, since, in many cases, forward orders on mill books assure steady operations during the remainder of January, and, in some instances, well into February. Jan. 20 1934 Financial Chronicle 404 An announcement issued Jan. 13 by the United States DepartThe volume of cotton goods production during December was the smallest in many months. The December index of cotton goods production was 76, ment of Commerce further said: taking the average of 1922-1927 as equal to 100, as against 88 in November, Total shipments for the five months of the season amounted to 4,180,000 and seasons ago, three 87 in December last season, 78 two seasons ago, 77 valued at $219,245,000, against 4,246,000 bales, valued at $166,bales, December in manufacturing was 70 general 94 four seasons ago. The index of • 776,000, representing a decline of 66,000 bales, or 1.6%, but an increase of two seasons season, 66 December last November, 58 in in compared with 71 as $52,469,000, or 31%, as compared with the corresponding five months ago, 76 three seasons ago, and 93 four seasons ago. The decline in cotton of 1932. goods production in December as compared with November is attributed to For the five months of the cotton season larger shipments were reported have been largely due to the NRA limitation of working hours to a maximum for Japan, China and Canada, but smaller shipments were registered for of 60 a week as compared with the previous maximum of 80 hours a week. Germany, United Kingdom, France, Belgium, Spain and the Netherlands. Detailed figures for these countries follow: Census Report on Cotton Consumed and on Hand, &c., in December. Under date of Jan. 13 1934, the Census Bureau issued its report showing cotton consumed in the United States, cotton on hand, active cotton spindles and imports and exports of cotton for the month of December 1933 and 1932. Cotton consumed amounted to 348,393 bales of lint and 51,624 bales of linters, compared with 475,368 bales of lint and 59,111 bales of linters in November 1933 and 440,439 bales of lint and 48,068 bales of linters in December 1932. It will be seen that there is a decrease under December in 1932 in the total lint and linters combined of 88,490 bales, or 18.12%. The following is the statement: DECEMBER REPORT OF COTTON CONSUMED, ON HAND,IMPORTED AND EXPORTED, AND ACTIVE COTTON SPINDLES. [Cotton in rustling bales, counting round as half bales, except foreign, which Is in 500-pound bales.) Cotton Consumed During-. Year Cotton on Hand December 31- Cotton In Con- In Public Spindles Five Active Storage Months awning Ending Establish- & at Corn- During men's. presses. December Dec. Dec. 31 (bales) (bales) (bales) (bales) (Number) United States ( 1933 348,383 2,415,690 1,641,74210,313.461 24,840,870 1 1932 440,439 2,342,005 1,530,040 10,349,811 23,799,742 Cotton-growing States_ _ 1933 282,941 1,933,086 1,290,590 9,947,899 17,338,794 1932 371,318 1,953,832 1.237,202 9,877,817 16,831,334 1933 56,376 411,289 289,437 251,597 6,815,136 1932 56,539 321,917 243,984 265,288 6,294,848 686,940 71,315 61,715 113,965 1933 9,076 673,560 66.256 48,854 206,708 1932 12.582 New England States All other States Included AboveEgyptian Cotton 1933 6,150 1932 6,645 1933 2,249 1932 2.698 Amer.-Egyptian cotton_ _ _ 1933 1,119 1932 1,694 Not Included AboveLinters 11933 51,624 1932 48.068 Other foreign cotton 45,181 35,132 18,634 18,918 5,209 8,880 25,636 29,540 20,418 13,906 5,115 5,359 21,398 28,856 3,673 4,369 2,384 10,048 337,295 282.296 292,095 300.475 35,592 59.947 Imports of Foreign Cotton (500-1b. Balsa). Country of Production. Egypt Peru China Mexico British India All other Total 5 Mos. End. Dec. 31. December. 1933. 1932. 9,000 375 2,930 896 812 4,096 132 6,297 14,013 1933. 1932. 21,633 2.885 12,183 19 198 38,460 2,656 4,528 1,041 9,826 133 10,742 56,644 37,914 861 352 Exports of Domestic Cotton Excluding Linters • (Running Bales-See Note for Linters). Country to Which Exported. United Kingdom France Italy Germany Spain Belgium Other Europe Japan China Canada All other Deconber. 5 Mos. End. Dec. 31. 1933. 1932. 151,437 81,692 73,662 122.238 24,410 12,521 70,775 217,190 29,028 29,407 7,739 190,091 727,716 98,561 496,528 93,906 371.059 164,231 757,378 30,649 137,941 27,531 67,747 51,432 314,226 305,149 1,018,750 41,878 136,326 19,682 118,681 18,685 33.746 1933. 1932. 730,304 508,859 371,216 953,144 147,768 97,572 236,997 948,207 125,562 83,603 42,816 Total 820,099 1,039,795 4,180,098 4,246,048 Note.-Linters exported, not Included above, were 17,655 bales during December In 1933 and 19,129 bales In 1932; 66,457 bales for the 5 months ending Dec. 31 in 1933 and 71.293 bales in 1932. The distribution for Dec. 1933 follows: United Kingdom, 4,862: Netherlands, 165: Belgium, 630; France, 1,238; Germany, 8,383: Italy, 100; Spain. 50; Canada, 298; Japan, 1,701; Panama, 30; British Honduras, 2: South Africa. 194; British West Indies, 2. WORLD STATISTICS. The world's production of commercial cotton, exclusive of linters, grown in 1932, as compiled from various sources was 23,634,000 bales, counting American in running bales and foreign in bales of 478 pounds lint, while the consumption of cotton (exclusive of linters in the United States) for the year ending July 31 1033, was 24,986,000 bales. The total number of spinning cotton spindles, both active and Idle is about 158,000,000. Cotton Exports from the United States for December Below November and December 1932-Value Below Month Previous, but Above Year Ago. Exports of c,fton from the United States during December amounted to 820,000 bales, valued at $43,851,000, compared with 915,000 bales, valued at $48,335,000, for November and 1,040,000 bales, valued at $38,735,000, for December 1932, representing a decrease of 95,000 bales and $4,484,000 from the November figures and a decline of 220,000 bales but an increase of $5,116,000 as compared with December 1932, according to an analysis of the export figures by the Textile Division of the Bureau of Foreign and Domestic Commerce. 1,000 Bales. Increases- 1933. 1932. 1933. 1932. Japan China Canada 1,000 Bales. $1,000. • $1,000. Decreases- 1933. 1932. 1933. 1932. 1,019 948 53,218 36,123 Un. Kingdom 136 126 6,982 4,748 Germany_._ _ 119 84 6,161 2,965 France Spain Belgium Netherlands_ 728 757 497 138 68 63 730 37,504 27,941 953 39,685 38,333 509 26,290 20,801 148 7,531 6,147 98 3,563 3,861 64 3.358 2,585 Import Duty on Cotton Piece Goods and Fents Lowered by British India. Effective Jan. 8 1934, the British Indian import duty on non-British plain gray cotton piece goods was reduced to 50% ad valorem, or 5Y4 annas per pound, whichever rate returns the higher duty, from the previous rate of 75% ad valorem, or 6% annas per pound, whichever is higher, and the duty on other non-British cotton piece goods and fents imported from all sources was lowered to 50% ad valorem as against the former duty of 75% ad valorem, according to a radiogram received in the United States Department of Commerce from Trade Commissioner George C. Howard, Calcutta, and announced on Jan. 11 by the Commerce Department. The announcement added: This restores the rates on cotton piece goods, other than fents, in effect previous to Aug. 30 1932. The above tariff changes are understood to be one of the results of the negotiations which have been carried on between representatives of the British Indian and Japanese Governments with respect to the importation of Japanese piece goods into British India. (The Indian rupee of 16 annas at present exchange equals approximately $0.38 United States currency.) British India Grants Japan Cotton Cloth Import Quota-Agreement Calls for Purchase of British Indian Cotton in Return. Recent negotiations between representatives of the British Indian and Japanese Governments have resulted in the conclusion of an agreement providing for specific quotas on imports of cotton piece goods from Japan to former lower import duties in return for definite Japanese imports of British Indian cotton, effective after the exchange of early ratifications at London, the agreement to remain in force until March 31 1937, according to a cablegram from Consul-General Arthur C. Frost, Calcutta, Jan. 11. In announcing this, on Jan. 13, the United States Department of Commerce added: The agreement specifies that the policy of according most-favored-nation treatment to each other's products will continue for all articles with certain specified safeguards against exchange variations. The agreement provides for an import duty of 50% ad valorem, or 514 annas per pound, whichever rate returns the higher duty, on plain gray cotton piece goods with an import duty of 50% ad valorem on other piece goods. These are the rates that were in force previous to Aug. 30 1932 and recently announced by the British Indian Government as again applying to all non-British piece goods with effect from Jan. 8. [This is referred to elsewhere in our columns of to-day.-Ed.] The agreement provides for an annual import quota of 325,000,000 yards of Japanese piece goods into British India. This allotment is linked with and contingent upon Japan's purchases of 1,000,000 bales of British Indian raw cotton. In the event that imports of British Indian cotton fall below that figure, the piece goods quota will be reduced by 2,000,000 yards for each 10,000 bales under the specified amount. If exports of British Indian raw cotton exceed 1,000,000 bales, the piece goods quota increases by 1,500,000 yards for each additional 10,000 bales but with the total yardage in no case exceeding 400,000,000. The Japanese piece goods quota comprises the following categories: Plain gray, 45%; bordered gray, 13%; bleached, 8%; colored and other piece goods, 34%, with certain adjustments permissible within these classifications. The agreement specifies that transfer of unused quotas is permissible, up to 20,000,000 yards, from one-half year period to the next subsequent period. Boycott on Indian Cotton by Japan TerminatedReduction in Indian Supplies Expected Narrowing Spread Between American and Indian Prices. The Japanese boycott on Indian cotton, which has just been terminated, has been a contributing factor in depressing the price of Indian cotton relative to the American staple in foreign markets, the New York Cotton Exchange Service announced on Jan. 8. Supplies of Indian cotton, the Exchange Service said, have been accumulating in India due to the lack of Japanese demand, since, despite the relative price attractiveness of Indian cotton as compared with the past two years, European spinners have increased their consumption of it to only a moderate degree, as they are not equipped to shift quickly from American to Indian cotton. The termination of Volume 138 Financial Chronicle 405 by the planning and co-ordinating committee representing the industry," the Oil Administrator pointed out. The Standard Oil Co. of New Jersey and its subsidiaries have inaugurated a certain "boy's club contest" which At the present time Indian Oomra cotton is selling about 136 points below violates the terms and spirit of the prohibition against prizes, American middling cotton in the Liverpool market as against 116 last August, Mr.Ickes continued. The matter was called to the attention 54 in January last year, 16 two years ago, and an average of 163 in the past of the company, but upon advice of its counsel, it has defive seasons. On a percentage basis, Indian Oosnra is selling at 75.5% of the price of American as against 80.0 last August, 89.6 in January last year, dined to discontinue the program, he said. 97.1 two years ago, and an average of 78.5% in the past five seasons. The planning and co-ordinating committee reported The stock of Indian cotton in India on Nov. 30, including the estimated this stand to the Oil Administration and recommended that unpicked portion of the current crop, was 527,000 bales larger than at the end of November last season, and 1,670,000 bales larger than two seasons "these unfair activities of the Standard Oil Co. of New ago, but it was 419,000 bales smaller than four seasons ago. It totaled Jersey" be stopped, Mr. Ickes stated. "Under my instruc6,070,000 bales of 400 pounds each, on the basis of the Exchange Service tions, and with the consent of the Department of Justice, calculations, as against 5,543,000 bales at the end of November last season, 4,400,000 bales two seasons ago, and 6,489,000 bales four seasons ago. The attorneys of the Petroleum Administrative Board have increase in stocks on Nov. 3 over last season and two seasons ago was due to a larger initial season supply as a result of both a larger carryover and a. asked for an injunction." larger crop, coupled with a smaller domestic consumption and export moveThe contest, widely advertised in newspaper and on the ment. The initial supply for this season was 7,233,000 bales as compared radio programs as well as in advertising matter company's with 6,862,000 bales last season, 5,798,000 bales two seasons ago, 7,592,000 at the company's filling stations, was held by Mr. Ickes bales three seasons ago, and 8,099,000 bales four seasons ago. During the four months from Aug. 1 to Nov. 30 Indian mills consumed 755,000 bales of to be a "clear violation of the fair competition rules of the Indian cotton as against 831,000 bales in the corresponding portion of last code." season, 770,000 bales two.seasons ago, 699,000 bales three seasons ago, and In a statement defending its position, the company an784,000 bales four seasons ago. Exports during the same four-month period were very small, owing principally to the Japanese boycott, and totaled nounced its intention to oppose the suit. "The suit is approximately 408,000 bales as against 488,000 bales during the correundertsood to be based on the theory that the offering of sponding four months last season, 628,000 bake two seasons ago, 988,000 prizes to boys in the form of baseballs, fielders' mitts and bales three seasons ago, and 826,000 bales four seasons ago. As a result of the settlement at the Delhi conference, Japanese cotton trips to training camps violates rules 16 and 17 of the Code spinners have agreed to take 1,500,000 bales of Indian cotton annually for of Fair Competition for the Petroleum Industry," the comthe next three years, in return for tariff concessions on exports of Japanese. pany stated. made cotton cloth to India. While European spinners have increased their consumption of Indian cotton only moderately in recent months owing to "Rules 16 and 17 do not present a new limitation on the the price attractiveness of Indian cotton relative to American; foreign marketing of petroleum products. These rules have been observers believe that had the Japanese boycott on Indian been continued longer and the price of Indian cotton further depressed, Europe might have in existence for four years and since 1929 have been part of a Increased its consumption of Indian cotton to substantial proportions this code approved by the Federal Trade Commission. They season, largely at the expense of American cotton. Accordingly, it is anticiwere devised and intended to prevent the practice of selling pated that while Japan will use less American cotton than was indicated petroleum products below the open posted prices. It is earlier in the season, European spinners will use more. regrettable that the Government's interpretation of these Half of Requirements of Greece's Spinning Mills in provisions should lead it to attempt to interfere with a project 1934 to Be Fulfilled by Domestic Cotton. in which prizes are not offered as a price concession or in any Greece's 1933 domestic cotton crop is expected to provide way in connection with sales, but in pursuance of a legitimate more than half of local requirements during the current year, advertising program. It should be clearly understood, as according to a report to the United States Commerce Depart- emphasized in the radio announcement, that participation ment from Commercial Attache K. L. Rankin, Athens. This in the contest in no way involves any obligation whatever is the first time such development has occurred since cotton to make any purchases from the Standard Oil Co. of New spinning became an important industry in Greece, it is Jersey or its affiliates." pointed out. We further quote, as follows,from an announceIn conclusion, the company stated that it "is supporting ment issued Jan. 10 by the Commerce Department: code and endeavoring scrupulously to observe it in the The 1933 cotton crop, estimated at 60,000,000 pounds of unginned, or letter and in spirit." about 18,000,000 pounds of ginned cotton, represented more than twice the 1932 production. Despite unofficial announcements that Harold L. Ickes, Imports of ginned cotton into Greece during the nine months ended SeptemAdministrator, would announce his final decision on Oil ber 1933 totaled 13,225,000 pounds compared with 12,402,000 pounds for the proposed marketing agreements submitted by the major the corresponding period of 1932. The United States supplied 6,907,357 pounds, a figure slightly larger than that for the 1932 period, while ship. factors of the industry in place of Federal control of prices ments from Turkey showed a marked decline. of petroleum products by Wednesday, the week closed Cotton shipments from Egypt also increased. An important feature was with no statement from Mr. Ickes up to a late hour last the large importation of Soviet cotton as a result of efforts inaugurated by Russia early in 1933. Considerably larger quantities of Indian cotton were night (Friday). also imported because of low prices. Meantime, protests from independent factors in the The record domestic cotton crop and protective measures adopted by Greece industry continued to reach the Oil Administration. Charges will undoubtedly reduce cotton imports during 1934, the report declares, despite the acknowledged inferiority of the local product and the rapidly that the marketing pacts, if approved, would foster monoIncreasing consumption by Greek cotton mills. polistic tendencies on the part of the major units in the industry and eventually result in the elimination of the inCotton Mills in Lille, France, Reduce Wages—Action dependents in the field have been heard since the proposed Taken Due to British Competition. pacts made public. were first The Lille, France, cotton mills, hard bit by British compeIn response to the protests against the agreements, tition, began to cut wages on Jan. 13, it is reported in Associated Press advices from that place. Leading manufacturers Mr. Ickes said that he would not approve the pacts until he posted reductions of 6% for men employees and 8% for was fully satisfied that their terms were fair to all concerned. Revisions of the plans were made by Mr. Ickes women, effective Feb. 1, the advices said. as he found that certain sections were objectionable, while Petroleum and Its Products—Ickes Charges Standard total elimination was the fate of others of which he did of New Jersey with Violation of Marketing Pro- not approve. Nd decision has been reached by the three-judge Federal visions of Petroleum Code—Industry Waits Ruling by Oil Administration on Proposed Marketing Court in Houston, Tex., which is considering evidence in Agreements. an attempt made by a group of independent operators in In the first action charging a major company in the the East Texas field to over-rule the authority of the Texas industry with violating the petroleum code, the Standard Railroad Commission. However, production of "hot oil" Oil Co. of New Jersey was charged with refusing to abide in the field has diminished sharply as the Railroad Comby the marketing provisions of the code in a bill of complaint, mission and Federal oil agencies move to punish violators seeking an injunction to restrain it from violating provisions of the State's proration laws. prohibiting the use of premiums to encourage sales, filed in While it is unlikely that the court will sustain the indethe District of Columbia Supreme Court Tuesday by the pendents in their plea to issue a permarent injunction against Federal Oil Administration. the Texas Railroad Commission forbidding it to enforce its The Oil Administration acted after numerous complaints proration rules, it is reported that should this occur, the had been received that the company was violating the oil administration is prepared to rush the case through to marketing provisions of the code, Harold L. Ickes, Oil the United States Supreme Court. In view of the fact that Administrator, said in commenting on the action. the case attacks the constitutionality of the NRA through "Rule 16 and 17 of Article V of the code prohibits the the petroleum code, a reversal of any unfavorable decision giving of premiums or other things of value unless permitted reached by the lower court is almost certain. the Japanese boycott is expected to bring about a reduction in Indian supplies, with a consequent narrowing of the spread between American and Indian cotton prices. Continuing, the Exchange Service's announcement stated: 406 Financial Chronicle Increased demand for crude oil is reported in Texas where it is held that current excess of demand over supply is approximately 100,000 barrels daily. Oklahoma and Kansas operators have made known their dissatisfaction with current production allowables with oil men in the latter State estimating that buyers would absorb 13,000 barrels daily over the present Federal allowable. In addition to legal steps already taken, considerable pressure is being exerted on consistent producers of "hot oil" in the East Texas field by other factors. The Planning and Co-ordinating Committee has been requested to have the Federal Government send 25 income tax experts to the East Texas area to check the books of suspected violators. In the meantime, hot oil producers are meeting with heavy fines in the State and Federal drive against the production of illegal oil. Reports that production of "hot oil" in the East Texas area had again spurted and were around 35,000 barrels daily were held "exaggerations" by Edward Clark, Assistant Attorney-General, in Austin on Monday. Mr. Clark has been investigating conditions in that area. W.W. Bradley and W.W.Blake paid a judgment of $8,000 penalties ordered by the District Court at Longview to make 50,000 barrels of illegally-stored oil legal. With Oklahoma showing a sharp spurt in crude oil output, the Nation's total for last week rose to a daily average of 2,311,250 barrels, compared with the Federal allowable of 2,183,000 barrels daily, reports to the American Petroleum Institute disclosed. California output also was slightly above the preceding week but Texas succeeded in bringing total production there down slightly during the week. The rise in the Oklahoma total, reaching 170,450 barrels, was held due to the practice of operators in that State of letting the wells run in the first half of the month, then cutting them down sharply in the latter two weeks in order to bring total output for the month with the limits of the Federal allowable. There were no price changes this week: Prices of Typical Crudes per Barrel at Wells. (AU gravities where A. P. I. degrees are not shown.) 81.00 $2.45 Eldorado, Ark., 40 Bradford, Pa 1.03 1.20 Rusk, Tex., 40 and over Corning, Pa .87 1.13 Darst Creek Illinois .90 1.13 Midland District, Mich Western Kentucky 1.35 Mid-Cont., Okla., 40 and above_ 1.08 Sunburst, Mont Hutchinson, Tex., 40 and over..--- 1.03 Santa Fe Springs. Calif..40 and over 1.30 1.04 1.03 Huntington, Calif., 26 Spindletop. Tex., 40 and over 1.82 .75 Petrolia, Canada Winkler. Tex .70 Smackover. Ark., 24 and over REFINED PRODUCTS-LUBRICANTS AGAIN ADVANCED BY PENNSYLVANIA REFINERIES-LOCAL GASOLINE PRICES HOLD UNCHANGED-MID-WEST BULK GAS MARKET SOFT-NEW ORLEANS SERVICE STATION QUOTATIONS AGAIN REDUCED. Pennsylvania lubricants were in strong demand as the week closed-neutral oils, bright stocks and cylinder stocks moving up M cent a gallon yesterday (Friday) at all Pennsylvania refineries. New prices on bright stock of 25-pour test and on neutral oil of 25-pour test, 200 viscosity, are 27 cents a gallon. After last week's sharp revisions in gasoline prices, the local market was quiet during the week and, with the exception of the price war raging in five counties in New Jersey, quotations were fairly stable. While no announcement has been made by N. R. Margold, Chairman of the Petroleum Administrative Board, on results of the oil administration's investigation of the war, the trade believes that this condition will be straightened out by the Federal oil authorities. Demand for refined products here moved along in routine channels with little developments of any importance noted. Unsettled conditions in the fuel oil market were reported due to alleged violations of the code by some factors. The spot gasoline market in Chicago closed weak with low octane material obtainable at 33' cents a gallon from East Texas and some Oklahoma points. The market for standard grade was adversely affected by the continued weakness in the lower-octane material and the current market is around 43/ec. a gallon. The purchase of from 200 to 300 cars of spot gasoline in the East Texas area by a major compeny early in the week temporarily stabilized the market but later m the week its market sagged again. Favorable weather has been a decidedly important factor in the relative steadiness of the retail gasoline price structure, it is pointed out by Chicago distributors. With demand holding up to a better than seasonal average, there has been httle necessity for price-cutting to maintain gallonage, save in isolated instances, and as a result the retail market is fairly stable. Secretary Ickes yesterday (Friday) approved an order increasing the allowable for gasoline stocks in storage on Ian. 20 1934 February 28 to 52,130,000 barrels, up approximately 630,000 barrels from the total established for Jan. 31. Motor fuel stocks rose 427,000 barrels last week to 51,033,000 barrels, the American Petroleum Institute reported. Operations from refineries rose to 63.3% last week from the low level of 59% in the previous -week. The price war in the New Orleans retail gasoline market continued, with a further reduction of 1 cent bringing the service station quotation down to 15 cents a gallon, including taxes, off 1 cent. An interesting angle OD the proposed code for oil tanker operations is that this code,if approved by the administrator, probably would cause an advance in refined petroleum product prices. Increased operating costs due to larger crews under the code would naturally result in higher shipping costs to the oil companies, it was pointed. Should the rise in the cost of gasoline and fuel oil to Eastern ports from California and Southern ports cut the shipments, then the increased demand for mid-continent crude would play an important part in determining the price structure. Price changes posted during the week were: Monday, Jan. 15.-All major units in New Orleans to-day reduced service station prices of gasoline 1 cent to 15 cents a gallon, taxes included. Friday. Jan. 19.-Prices of Pennsylvania lubricants, Including neutra$ oils, bright stocks and cylinder stocks, were advanced 3.6 cent a gallon. to-day. Gasoline, Service Station, Tax Included. 8.15 New Orleans $ 165 Detroit 1.15 New York Houston 18 z 12 Philadelphia 19 Atlanta Jacksonville .19 BanFrancisco: 17 Boston Los Angeles: Third grade__ .17 18 Buffalo Third grade.... .165 Above 65 octane_ .19H 16 Chicago Standard 19 Premium 214 .205 Cincinnati Premium 21 St. Louis 14 205 Cleveland z Less taxes. Minneapolis 15 .19 Denver Kerosene, 41-43 Water White, Tank Car, F.O.B. Refinery. Chicago $ 02H-.03% New Orleans, ex ____$.034 New York: .0414-.06 Tulsa .04%-.0334 (Bayonne) $.05-.05) Los Ang., 03 North Texas Fuel 011. F.O.B. Refinery or Terminal. Gulf Coast C California 27 plus D N. Y.(Bayonne): $1.05 $.75-1.00 Chicago 18-22 D.. .421.6-.50 Bunker C $1.20 .80 Phila. Bunker C.1.15-1.20 Diesel 28-30 D._ 1.95 New Orleans C Gas Oil, F.O.B. Refinery or Terminal. I Tulsa N. Y.(Bayonne): Chicago: 6.01H I 28 plus 0 0--$.033(-.041 32-38 G 0 U. S. Gasoline, Motor (Above 65 Octane), Tank Car Lots, F.O.B. Refinery. Chicago N. Y.(Bayonne): N. Y.(Bayonne): 8-.04li Shell Eastern Pet_$.065 New Orl., ex $.04 -.0411 Standard 011 N..1.: Arkansas New York: Motor, U. S...$.06 04 -.041i Colonial-Beacon._ .06 California__ 06 -.07 62-63 octane- .05j 06 Los Angeles, ex .043-.o7 z Texas vStand. Oil N. Y. .06 06 Gulf porta.- __ .06 H-.071( Tide Water Oil Co .06 Gulf Republic Oil xRichfield 011(Cal.) .061,6 063( Tulsa .0414 Sinclair Refining_ .06 Warner-Quin. Co. .061i Pennsylvania.053( x Richfield "Golden." z"Fire Chief," $0.07. v Long Island City. World Tin Production to Be Increased by International Tin Committee. Agreements in connection with world tin production • have recently been reached by the International Tin Committee, according to advices to the United States Commerce Department from Assistant Commercial Attache Daniel J. Reagan, Paris. The Committee decided to increase the figures for world output, excepting that of Siam, which has not been changed, from 33.3 to 40% of 1929 production, as from Jan. 11934. The advices further noted: World production of tin in 1932 amounted to 98.500 tons, the share of Malaysia being 29,000 and that of Bolivia 21,000. Consumption during that year reached 117,000 tons, of which the United States accounted for 40,500 tons, Great Britain 20,000, Germany 12,000 and France 9.000. The combined effects of the restriction policy and the revival of demand allegedly caused a sudden increase in price during 1933, especially after March. World deliveries, estimated at 6,800 metric tons in March, rose to 11,900 tons in August. The suddenness of this increase is attributed in large part to American consumption. Crude Oil Production Rises 146,300 Barrels in Week Ended Jan. 13 1934-Inventories of Gas and Fuel Oil Off 828,000 Barrels. The American Petroleum Institute estimates that thedaily average gross crude oil production for the week ended Jan. 13 1934 was 2,311,250 barrels, an increase of 128,250 barrels over the allowable figure effective Jan. 1 1934 set by the Secretary of the Interior Ickes. This also compares with 2,165,950 barrels per day produced during the week 'ended Jan.6 1934,a daily average of 2,226,750 barrels during the four weeks ended Jan. 13 and an average daily output of 2,011,050 barrels during the week ended Jan. 14 1933. Inventories of gas and fuel oil declined further during the week under review, or from 117,163,000 barrels at Jan. 6 to 116,335,000 barrels at Jan. 13 1934, off 828,000 barrels. In the preceding week,inventories dropped.1,754,000 barrels. Further details, as reported by the American Petroleum; Institute, follows: Imports of crude and refined oil at principal United States ports for the week ended Jan. 13 totaled 778,000 barrels, a daily average of 111,143. Financial Volume 138 barrels, compared with a daily average of 133,893 barrels for the last four weeks. Receipts of California oil at Atlantic and Gulf ports for the week ended Jan. 13 totaled 623,000 barrels, a daily average of 89,000 barrels, compared with a daily average for the last four weeks of 78,429 barrels. Reports received for the week ended Jan. 13 1934 from refining companies controlling 92.4% of the 3,616,900 barrel estimated daily potential refining capacity of the United States, indicate that 2,116,000 barrels of crude oil daily were run to the stills operated by those companies and that they had in storage at refineries at the end of the week, 27.949,000 barrels of gasoline and 116,335,000 barrels of gas and fuel oil. Gasoline at bulk terminals, in transit and in pipe lines amounted to 19,884,000 barrels, Cracked gasoline production by companies owning 95.1% of the potential charging capacity of all cracking units, averaged 413,000 barrels daily during the week. DAILY AVERAGE CRUDE OIL PRODUCTION. (Figures in Barrels.) Actual Production. Federal Agency Allowable Week End Week End Jan. 13 Jan.6 Effective 1934. 1934. Jan. 1 446,600 110,000 Oklahoma Kansas Panhandle Texas North Texas West Central Texas West Texas East Central Texas East Texas Conroe Southwest Texas Coastal Texas (not including Conroe) Average 4 Weeks Ended Jan. 13 1934. Week Ended Jan. 14 1933. 548.200 108,250 377,750 113,350 456,800 109,450 401,150 88,450 41,600 58,050 24,450 120,550 43,150 381,550 55,100 42,650 41,800 57,850 24,200 119,550 43,550 408,800 61,400 44,900 41,100 57,700 24,100 120,000 43.250 460,000 56,800 42,850 44,150 46,900 24,250 159,950 48,300 268,300 23,550 50,250 104,050 103,650 103,800 106,350 871,150 905,700 889,600 772,000 27,760 44,000 27,350 43,450 26,700 43,700 28,500 36,600 69,300 71,700 70,800 70,400 65,100 Arkansas Eastern (not incl. Mich.) Michigan 33,060 94,200 29,000 31,950 98,350 27,300 31,850 96,900 27,000 32,050 95,200 27,850 32,200 94,700 15,050 Wyoming Montana Colorado 29,000 6,800 2,300 29,950 6,650 2,800 29,650 6,650 2,750 29,600 6,450 2,600 31,400 5,550 2,800 Total Texas 884,000 North Louisiana Coastal Louisiana Total Louisiana Total Rocky Mtn.States New Mexico California f Tntal 38,100 39,400 39,050 38,650 39,750 41,200 437,600 41,950 473,000 41,950 *61,600 42,000 464,750 27,850 474,800 9 1Q.1 nnn 0 n11 gen alas nen noon aro ant, nxn Notes.-The figures Indicated above do not Include any estimate of any oil which might have been surreptitiously produced. Allowables for Illinois, Indiana and Michigan are "tentative." The following paragraphs are quoted from the official order of the Department of the Interior, approved and promulgated Dec. 20 1933. "There shall be no net withdrawals of crude oil from storage during the months of January. February and March 1934,except in special cases upon the recommendation of the Planning and Co-ordination Committee, and the approval of the Petroleum Administrator. The period from Jan. 1 1934 to March 31 1934 inclusive, shall constitute the reckoning period for the determination of net withdrawals. "Excess production or withdrawals from storage of crude oil in any State during the months of October, November and December 1933, shall be charged against the allowable of the State for the months of January, February and March 1934." CRUDE RUNS TO STILLS. MOTOR FUEL STOCKS, AND GAS AND FUEL OIL STOCKS, WEEK ENDED JAN, 13 1934. (Figures in Barrels of 42 Gallons Each.) Daily Refining Capacity of Plants. Crude Runs to Stills. District. Reporting. Potential Rate. East Coast__ Appalachian.._ Ind., Ill., Ky.. Okla., Kan.,Mo Inland Texas__ Texas Gulf _ Louisiana Gulf _ No.La.-Ark- _ _ Rocky Mtn____ California 582,000 150,800 436,600 462,100 274,400 537,500 162,000 82,600 80,700 848,200 Total. % 582,000 100.0 139,700 92.6 425,000 97.3 379,500 82.1 165,100 60.2 527,500 98.1 162.000100.0 76,500 92.6 63,600 78.8 821,800 96.9 - % Daily OpelAverage. ated. 383,000 79,000 270,000 222,000 87,000 477,000 88,000 48,000 37,000 425,000 a Motor Fuel Stocks, Gas and Fuel Oil Stocks. 65.8 13,815,000 5,704,000 56.5 1,934,000 924,000 63.5 7,244,000 4,276,000 58.5 5,507,000 3,466,000 52.7 1,219,000 1,640,000 90.4 5,356,000 5,556,000 54.3 1,512,000 1,897,000 62.7 198,000 504,000 58.2 944,000 684,000 51.7 13,304,000 91,684,000 Totals week: Jan. 131934. 3,616.9003,342,700 92.4 2,116,000 63.3 c51,033,000 116,335,000 Jan. 6 1934. 3,616,900 3,342.700 92.4 1.973.000 59.0 b50.606.000 117.163.600 a Below are set out estimates of total motor fuel stocks In U. S. on Bureau of Mines basis for week of Jan. 13, compared with certain Jan. 1933 Bureau figures: A.P.1. estimate on B. of M. basis, week Jan. 13 1934 A. P. I. estimate on B. of M. basis, week Jan. 6 1934 U. S. B. of M. motor fuel stocks, Jan. 1 1933 53,805,000 barrels U.S. B. of M. motor fuel stocks, Jan. 31 1933 55,757,000 barrels b Includes 27,290,000 barrels at refineries, 20,076,000 barrels at bulk terminals, In transit, and pipe lines, and 3,240,000 barrels of other fuel stocks. c Includes 27,949,000 barrels at refineries, 19,884,000 barrels at bulk terminals, In transit, and pipe lines, and 3,200,000 barrels of other fuel motor stocks. x Because of the many changes made by companies in their method of reporting stocks to the American Petroleum Institute, it has been decided to discontinue our attempt at estimating figures on a Bureau of Mines basis until further notice. Limitation of Tin Production in Belgian Congo Proposed. Negotiations are under way between the International Tin Cartel and tin producers of the Belgian Congo, with a view to having the latter agree to a limitation of production, according to a report to the United States Commerce Department from Trade Commissioner Thomas Cutts, Brussels. In an announcement issued Jan. 10 by the Commerce Department it was further stated: The position of the Congo, it is pointed out, is quite different from that of other producers, inasmuch as the exploitation of its important cassiterite beds is only just beginning. Therefore, there can be no question of re- hronicle 407 clueing the present output, but rather of limiting the extraction tonnage for two or three years. At present a complete agreement has not yet been reached between all the Congo producers as between themselves. It appears obvious that they have a major interest in joining the Cartel as a means of maintaining prices at a remunerative level. The Congo cassiterite beds are very large and rich and production there will shortly reach 10% of the world production, according to Mr. Butts. The Congo producers requested at first a tonnage of 15,000 to 16,00C tons to be spread over a two-year period, but the International Cartel found these figures too high, and a smaller quantity spread over a different Period will be the object of further negotiations, according to the report. General Improvement in Demand for Copper, Lead, and Zinc-Tin Quiet. Metal and Mineral Markets for Jan. 18 1934 reports that the reaction to President Roosevelt's monetary policy as outlined in his message to Congress on Jan. 15 was favorable so far as the non-ferrous metal industry was concerned. Sales volume in copper, lead, and zinc was the largest for a weekly period in several months. The buying, in the opinion of trade experts, removed nearly all traces of weakness that disturbed operators since the turn of the year. Though prices showed virtually no gains, sentiment has improved in nearly all directions. Tin, an imported metal, did not share in the activity. Silver in the open market advanced slightly, notwithstanding some disappointment among the speculatively inclined traders that the President's message was not more specfic in connection with the future of that metal. The same publication says: Good Sales of Copper. The President's special message to Congress outlining a permanent monetary policy so stimulated the demand for copper that total sales last week were greater than those for any similar period in the past six months. Moreover, the message had the effect of snapping back the price of the metal to an 8c., delivered Connecticut, basis, following weakness in the price structure early in the seven-day period, during which several lots of fair tonnage sold at 7%c. and 7%c. The bulk of the week's business was for prompt or near-by delivery, but some orders of fair size were booked for the second quarter. Agreement on a code is said to be imminent. Deliberations have been in progress most of the current week, and the various interests participating are understood to be nearer to an agreement than at any time since the discussions began. According to gossip in the trade, an agreement on a code will be reached at a meeting to be held in Washington next Monday, which meeting will be attended by Deputy Administrator 0. H. King and Probably by General Johnson. Sales abroad were also good, the markets there reacting too to the President's message, and also probably to the progress that has been made on reaching a code agreement. During the seven-day period prices ranged from 7.90c. to 8.175c., c.i.f. Stocks of refined copper held in North and South America on Jan. 1 1934, totaled 523,000 tons, against 572,700 tons a year previous. and 544,278 tons at the beginning of 1932. At the beginning of 1929 the stocks of refined copper totaled 65,466 tons. Mine output of copper for the world during 1933 came to 1.019,171 short tons. Production of refined for the world is estimated at 945,182 tons. The U. S. Bureau of Mines, in a preliminary report, estimates Nevada's Production for 1933 at 38,900,000 lb., against 31,487,606 lb. in 1932. New Mexico, according to the same source, produced about 27,264,000 lb. in 1933, against 28,419,000 lb. of copper during 1932. Lead Business Active. Lead consumers felt that credit inflation should provide for a steady flow of business over the next six months,if not longer,and decided that this was a good time to take on metal in quantity. The result was a sales tonnage for the week of more than 12,000 tons, an excellent showing. This buying, in addition to the liberal purchases made in the week previous, removed about all of the lead from the market that caused the recent unsettlement in the Price structure. Even though the December statistics for refined lead will be unfavorable, the market appeared to be carried away for the time being by the prospects of improvement in general business activity. Should actual demand for lead fail to come up to expectations in the next two or three months,some adjustment will have to be made to control the upward trend in surplus stocks, according to trade authorities. The market closed the week in a firmer position. Producers seemed disposed to move slowly in the matter of revising their quotations, being influenced by the statistical position of lead and uncertainty over the extent of the trade revival. The price held at 4c., New York, the contract settling basis of the American Smelting & Refining Co., and 3.90c., St. Louis. Zinc Active. Demand for zinc, in common with that for the other non-ferrous metals, improved sharply during the last few days. With the exception of a round lot that sold last Thursday at 4.275c., St. Louis,sales early in the week were on a 4.25c. basis. On Monday and Tuesday a few lots changed hands at slightly advanced prices, ranging from 4.275c. to 4.35c., but the tonnages involved were small and the delivery positions were fairly far ahead, making any variation from a 4.25c. quotational basis for those days unwarranted. Late yesterday the market developed additional firmness, and before the close a fair quantity changed hands on a 4.30c., St. Louis, basis. Little Change in Tin. The London market was firm, despite the 'absence of buying for the, account of United States consumers. The price in New York moved over a fairly wide range, following sterling exchange fluctuations, but settled with little net change for the week. Demand here was quiet, consumers restricting their operations on the theory that the pound sterling will weaken in terms of United States dollars and they will be in a position to obtain the metal below current levels. Chinese 99% tin was quoted as follows: Jan. 11th, 50.80c.; 12th, 50.50c.:. 13th, 50.50c.; 15th, 51.50c.: 16th, 51.000c.; 17th, 50.500c. Agreement Covering Exports of Ship Building Plates and Sections Reached Between British Iron and Steel Interests and Continental Steel Entente. An agreement has been reached between the British National Federation of Iron and Steel Manufacturers and the C 408 Financial Chronicle Continental Steel Entente covering all exports of ship building plates and sections, according to Charge d'Affaires Ray Atherton, London, in a cabled report made public Jan. 9 by the United States Commerce Department, which said: The Steel Entente, it is pointed out, includes German, French, Belgian, Luxemberg, Saar, Czechoslovak, Austrian and Hungarian steel producers. The agreement is for a six months, trial period-from January through June of the current year. British home and Empire markets have been generally reserved to British manufacturers, while the Entente undertakes to discontinue price cutting in non-British markets and centralizes export sales in the Stahlwerks Verband of Dusseldorf. Other unofficial reports indicate that the Entente is increasing its price of ship plates in various Continental countries 10 shillings a ton, the cable stated. Steel Production Rises-Scrap Prices Continue to Advance. The operating rate of steel companies having 98.1% of the capacity of the steel industry was estimated at 34.2% of the capacity for the week beginning Jan. 15 1934, compared with 30.7% one week ago and 34.2% one month ago, it was indicated by telegraphic reports to the American Iron and Steel Institute on Jan. 15. This represents an increase of 11.4% over last week. According to the "Iron Age" of Jan. 18, steel output is showing a more rapid recovery than had been expected following the heavy shipments that were made against expiring contracts in December. Production for the country at large has risen two points to 33% and is only four points below the rate that prevailed in the final week of last month, when pressure to turn out material against lower-price& commitments was at its height, continued the "Age," which further went on to report: Part of the rebound in operations is undoubtedly accounted for by replenishment of depleted stocks of ingots, semi-finished steel and finished products. At Chicago, where such restocking has been completed, production has fallen off three points to 29% of capacity. At other important producing centres, however, output has increased, suggesting that rebuilding of inventories does not fully explain the current bouyancy of operations. Yet actual increases in bookings are confined mainly to heavier sheet specifications from the automotive industry and a larger aggregate volume of small orders from miscellaneous sources. The heavy tonnage business that the steel industry expects to get from the motor car builders, the railroads and the building Industry has not reached the mills. Production problems arising from the adoption of new front construction are still delaying the operations of all the leading automobile makers with the exception of Ford. Governmental red tape and demands for collateral against Federal loans are impeding the release of rail tonnage already ordered. Bids on Government-financed railroad equipment programs have been postponed pending the adoption of a carbuilders' code. Public works construction awards are still light compared with the tonnage releases looked for when the numerous projects now in various stages of progress finally reach the contracting stage. Structural lettings for the week, at 9.850 tons, are the lowest since midNovember and compare with 30,140 tons a week ago. Despite delays, there is no question about the support that steel output will eventually get from the "big three"-the automobile industry, the railroads, and construction. It is this favorable prospect, no doubt, which accounts for the continued strength of the scrap market. An advance at Pittsburgh has raised the "Iron Age" composite for heavy melting steel from $11.58 to $11.83 a gross ton, its eighth consecutive weekly advance. The Santa Fe, which last year announced its intention of purchasing 50,000 tons of rails, has bought a total of 34,700 tons. It also distributed orders for 3,800 tons of tie plates, 5,800 kegs of spikes and 1,600 kegs of bolts. The Illinois Central has obtained the Commerce Commission's approval of a Federal loan to finance orders for 21.600 tons of 112-pound rails and heavy repairs to 16.015 freight cars and 228 passenger cars. The New Haven has obtained a Public Works Administration allotment for the purchase of 50 passenger cars. Receivers of the St. Louis-San Francisco have asked court permission to apply for a Federalloan to finance orders for 26,000 tons of rails. The Van Sweringen railroads have postponed until Jan. 22 the taking of bids on 12,745 cars. Tin plate production is lagging, following heavy shipments against expiring contracts last month. Current mill activity, which ranges from a low of 20% to a high of 50%,is supported in part by export business. No further changes in steel prices are in immediate prospect, although there is some talk of an advance on semi-finished material in line with recent increases in the Prices of heavy finished products. The elimination of the present $1 a ton differential between Chicago and Pittsburgh base prices on plates, shapes and bars is mentioned as a possible development during the course of the current year. The "Iron Age" composite prices of pig iron and finished steel are unchanged at $16.90 a ton and 2.028 cents a pound, respectively. Furnace coke at Cotmellsville has declined 25 cents a ton to $3.50, ovens. The decline in steel output at Chicago was the only one reported. Operations rose two points to 24% at Pittsburgh, three points to 25% in the Philadelphia district, six points to 36% in the Valleys, three points to 50% at Cleveland, five points to 55% in the Wheeling territory, and seven points to 84% at Detroit. The Southern rate is unchanged at 50%, and the Buffalo average remains at 30%. A Pittsburgh district steel producer plans to resume operations this week at one of its blast furnaces. A merchant stack at Toledo has been banked. THE "IRON AGE" COMPOSITE PRICES. Finished Steel. Jan. 16 1934, 2.0280. a Lb. Based on steel bars, beams, tank plates One week ago 2.0280. wire rails, black pipe and sheets, 2 028c. These products make 85% of the One month ago 1.9230. United States output. One year ago Low. High. 2.028c. Jan. 2 2028c. Jan. 2 1934 1.8670. Apr. 18 2.036c. Oct. 3 1933 1.926c. Feb. 2 1.9770. Oct. 4 1932 1.9450. Dec. 29 2 037c. Jan. 13 1931 2.0180. Dec. 9 2 273c. Jan. 7 1930 2.273o. Oct. 29 2 317c. Apr. 2 1929 2.2170. July 17 2.2860. Dec. 11 1928 2.212c. Nov. 1 2.402c. Jan. 4 1927 Jan. 20 1934 Pig Iron. • Jan. 16 1934, 316.90 a Gross Ton. Based on average of basic iron at Valley One week ago 316.90 furnace foundry irons at Chicago. One month ago 16.90 Philadelphia. Buffalo, Valley, and BirOne year ago mingbam. 13.56 High. Low. 1934 $16.90 Jan. 2 $16.90 Jan. 2 1933 16.90 Dec. 5 13.56 Jan. 3 1932 14.81 Jan. 5 13.56 Dec. 6 1931 14.79 Dec. 15 15.90 Jan. 6 1930 18.21 Jan. 7 15.90 Dec. 16 1929 18.21 Dec. 17 18.71 May 14 1928 17.04 July 24 18.59 Nov.27 1,927 17.54 Nov. 1 19.71 Jan. 4 Steel Scrap. Jan. 16 1934, $11.83 a Gross Ton. rased on No. 1 heavy melting stee One week wk ago $11.58 • quotations at Pittsburgh,Philadelphia. One month ago 10.67 and Chicago. One year ago 6.751 Low. High. 1934 $11.33 Jan. 2 $11.83 Jan. 16 1933 6.75 Jan. 3 12.25 Aug. 8 1932 6.42 July 5 8.50 Jan. 12 1931 11.33 Jan. 6 8.50 Dec. 29 1930 11.25 Dec. 6 15.00 Feb. 18 1929 17.58 Jan. 29 14.08 Dec. 3 1928 13.08 July 2 16.50 Dec. 31 1927 15.25 Jan. 11 13.08 Nov.22 "Steel" of Cleveland Jan. 15 in its summary of the iron and steel markets stated: Heavier awards by the railroads and building industry, plus moderate expansion in purchasing by automobile manufacturers and miscellaneous consumers, support the general feeling of encouragement among iron and steel producers. This improvement,not all of which has yet reached the mills,foreshadow a reversal of the trend in steel production, off 1 point last week to 30%. New orders booked by some leading steel interests so far this month are ahead of the tonnage placed in the comparable period in December. One of the brightest features of the industrial picture, expected to be translated into orders for steel and steel products shortly, is the evident increase in purchasing power in agricultural areas. The automobile industry is slowly working out of its production difficulties, but still is far behind schedules for January. insuring that February and March will be correspondingly stronger months. There seems to be no doubt this delay is due to mechanical problems, and not a reflection on markets. Railroad business is developing more rapidly. Santa Fe has placed 33,000 tons of rails, and will buy 10,000 tons of fastenings shortly. Missouri Pacific has purchased 25,000 tons of rails. St. Louis & San Francisco is to buy 26,000 tons of rails early in February; Bangor,& Aroostook. 1,200 tons of fastenings. Delay in getting the carbuilders' code approved is holding up some pending car lists which are being financed by the Public Works Administration. Bids for heavy tonnages of steel in the Pennsylvania's equipment program are to be taken this week, with opening under the Clayton Act in 10 days. Indicating awards early in February. These include 75,000 tons of steel for 6.500 freight cars. More industrial building projects are noted in structural steel awards for the week, which rose to 28,252 tons. The largest reinforcing bar order In many weeks, 3.500 tons, was placed for a spillway bridge at Bonnet Oarre, La. For two tankers for the Standard Vacuum Transportation Co., New York. 11,400 tons of plates,shapes and bars have been purchased. American producers are expecting to take 25,000 tons of cast iron pipe for MOXiC0 City and 9,000 tons for Vera Cruz, Mex., announcement of which is expected daily. Government financing is speeding up work on the Hetch Hetchy, California, water project, requiring 17,000 tons of east pipe and 17,000 tons of welded steel pipe. Pig iron sales and inquiries are improving much earlier than anticipated. Gradual gains in foundry operations are reflected in Increasing coke shipments. Scrap prices continue to rise, "Steel's" composite being up 21 cents to $11.08; the sixth consecutive weekly advance registering a total gain of $1.75. Daily average steel ingot production for December, 72.786 gross tons, was 22.6% higher than in November. The month's total of 1,819.648 tons brought the output for last year to 22,878,571 tons, compared with 13,322,833 tons in 1932, and 25,192,715 tons in 1931. Finished steel shipments by the United States Steel Corp. last month increased 39% over November to 600,639 tons. For the year, the corporation's shipments were 5,760,952 tons, 1,786,890 tons more than in 1932. Demand for finished steel is gaining considerable impetus in Great Britain, according to "Steel's" cablegram. Russia is reported to have purchased 36.000 tons of steel products in Poland. Certain Washington officials look for Russia to be a heavy buyer In the near future, estimating steel requirements for its railroad program as 7,000.000 tons for cars and locomotives, and 3.270,000 tons of rails. Steelworks operations advanced 6 points to 62% in the Wheeling district. and 3 to 54% at Cleveland. They dropped 7 points to 88% In New England; 2 to 32% at Chicago; 1 to 21% at Pittsburgh: 1 to 2151% in eastern Pennsylvania; and 6 to 26% at Youngstown; continuing 79% at Detroit, 52% Birmingham and 29% Buffalo. "Steel's" iron and steel composite remains $32.42; and the finished steel composite, $51.10. Steel ingot production for the week ended Jan. 15 is placed at about 323/2% of capacity, according to the "Wall Street Journal" of Jan. 17. This compares with 31% in the previous week, and with 30% two weeks ago. The "Journal" further reports as follows: U. S. Steel Corp. is estimated at approximately 29%, against 28% in the two preceding weeks. Independents are credited with a rate of 35%, compared with a shade under 33% in the week before and 31% two weeks ago. Since Monday there have been further increases in output, notably in some of the so-called independent companies, and in the mills which are getting business from the automobile industry and in miscellaneous lighter products. The large units working on the heavier articles have not yet expanded their activities to the extent which is anticipated for a little later on. The following table gives the percentages of capacity production in the most nearly corresponding weeks of previous years, together with the approximate changes from each Immediately preceding week: Whole Industry. U. S. Steel, 1933 1932 1931 1930 1929 1928 1614+1 2434+234 40 +4 65 +534 8234-134 74 +3 15+ 55 24+2 48+4 67+5 85-1 78+3 174-1 25+334 37+5 64+6 80-2 70+3 100 . 1 711 44 Tim!, Rid Tinrth AR IL TTri Independents Financial Chronicle Volume 138 Annual Eastern Savings Conference to be Held in New York Jan. 25-26 Under Auspices of Savings Division of American Bankers Association-Plans for Insuring Savings Bank Deposits in Various States to be Discussed. The annual Eastern savings conference,under the auspices of the Savings Division, American Bankers Association, will be held at The Waldorf-Astoria, New York City, Jan. 25 and 26,it was announced Jan.11 by W.Espey Albig. Deputy Manager of the Association. The general topics of the meeting will include methods of salvaging real estate mortgages, plans in various states for insuring savings bank deposits, public relations of banks, municipal credit, and money. 409 During the coal year to Jan. 6 1934 there were produced a total of 257,086,000 net tons of bituminous coal and 38,191,000 tons of anthracite as compared with 225,929,000 tons of bituminous coal and 37,509,000 tons of anthracite during the coal year to Jan. 7 1933. The Bureau's statement follows: ESTIMATED UNITED STATES PRODUCTION OF COAL AND BEEHIVE COKE (NET TONS). Week Ended Jan. 6 1934.c Dec. 30 1933. Coal Year to Date. /an. 7 1933. 1933-1934. 1932-1933.d 1929-1930.d Bitum. coal-a Weekly total 7,025.000 6,443,000 6,126,000 257,086.000 225,929,000 401,329.000 Daily aver_ _ 1,386,000 1,289,000 1,156,000 1,094,000 962,000 1,704,000 Pa. anthra.-b • Weekly total 1,393,000 950,000 647,000 38,191,000 37,509.000 56,204,000 December 1933 Anthracite Shipments Off 9.44% from Daily aver__ 278,600 190,000 129,400 243,300 161,700 164.600 Beehive cokeCorresponding Period in 1932. Weekly total 21.600 19,500 18,000 591.700 446.100 4,978,000 Daily aver__ 3.900 3,000 3.600 2,476 1,867 20,830 Shipments of anthracite for the month of December 1933, a Includes lignite, coal made into coke, local sales, and colliery fuel. b Includes as reported to the Anthracite Institute, amounted to Sullivan County, washery and dredge coal, local sales, and colliery fuel. c Subject 4,011,992 net tons. This is a decrease as compared with to revision. d Production during first week of April adjusted slightly to make comparable with year 1933-1934. shipments during the preceding month of November of accumulation ESTIMATED WEEKLY PRODUCTION OF COAL BY STATES 86,238 net tons, or 2.10%, and when compared with De(NET TONS). Reading Co Lehigh Volley RR Central RR.of New Jersey Del. Lack. dr Western RR Delaware & Hudson RR.Corp_ Pennsylvania RR Erie RR N. Y. Ontario dt Western Ry Lehigh & New England RR_ _ _ Total *Revised. Dec. 1933. Nov. 1933. 908,961 677,329 365,496 468,972 452,468 440,294 345.652 236,865 115,955 899.476 691,895 332,305 453,949 505,446 475,696 343,535 221,732 174,196 938,241 693,263 333,959 485,866 470,523 591,212 464,157 266,448 186,753 815,222 570,417 278,536 417,938 425,824 484,249 447.931 224,597 187,692 4 nil no2 4 098 230 4.430.422 3.852.406 Dec. 1932.* Nov. 1932. Dec. 23 1933. Dec. 31 /932. 172,000 48,000 146,000 935,000 332,000 70,000 128,000 482,000 172,000 34,000 10,000 50,000 30,000 55,000 413,000 1,780,000 58,000 14,000 72,000 162,000 30,000 1,340,000 513,000 123,000 11,000 153,000 48.000 139,000 782,000 283,000 69,000 129,000 426,000 170,000 30.000 14,000 48.000 24,000 50,000 334,000 1,356,000 68,000 10,000 91,000 156,000 30,000 1,104,000 263,000 94.000 6,000 349,000 83,000 253,000 1,535,000 514,000 121,000 159,000 584,000 204,000 37,000 21,000 64,000 56,000 27,000 599.000 2.818,000 103,000 21,000 100.000 193.000 57,000 1,132,000 692,000 173,000 5.000 6.443,000 950,000 7,180.000 1,319,000 5,877,000 901,000 9,900,000 1.806.000 MN_ ,.. .-1 Bituminous Coal and Anthracite Production Up in First Week of 1934. According to the United States Bureau of Mines, Department of Commerce, the total production of bituminous coal during the week ended Jan. 6 1934 is estimated at 7,025,000 net tons,compared with 6,443,000 tons in the preceding week and 6,126,000 tons in the corresponding period last year. Anthracite production in Pennsylvania totaled 1,393,000 net tons as against 950,000 tons in the week ended Dec. 30 1933 and 647,000 tons in the week ended Jan. 7 1933. Alabama Arkansas and Oklahoma Colorado Illinois Indiana Iowa Kansas and Missouri Kentucky-Eastern Western Maryland Michigan Montana New Mexico North Dakota Ohio Pennsylvania (bituminous) Tennessee Texas Utah Virginia Washington West Virginia-Southern_a Northern_ b Wyoming Other States • Total bituminous coal Pennsylvania anthracite Dec. 30 1933. Nt...N,t. C-CON .SM ••••••, . Month of- Week Ended State. §§§§§§§§§§§§§§§§§§§§§§§§§ ;c4.-; 4—;, di, -74, uicia;OOO.64.3c,:ge•:uic>.i.i, , ..0. M C4 ..0 tM cember 1932,shows a decrease of 418,430 net tons, or 9.44%. Shipments by originating carriers (in net tons), are as follows: Dec. Aoge. 1923. Total coal 7,393,000 8,499,000 6,778,000 11,706.000 a Includes operations on the N.& W.,C.& O., Virginian, K.dc M.and B.C. G b Rest of State, Including Panhandle. Current Events and Discussions The Week with the Federal Reserve Banks. The daily average volume of Federal Reserve bank credit outstanding during the week ended Jan. 17, as reported by the Federal Reserve banks, was $2,658,000,000, a decrease of $7,000,000 compared with the preceding week and an increase of $554,000,000 compared with the corresponding week in 1933. After noting these facts, the Federal Reserve Board proceeds as follows: On Jan. 17 total Reserve bank credit amounted to 82.646.000.000. a decrease of $9.000,000 for the week. This decrease corresponds with decreases of $41,000,000 in money in circulation and $36,000.000 in unexpended capital funds, non-member deposits, &c., offset in part by an increase of $11,000,000 in member bank reserve balances and a decrease of $55.000,000 In Treasury currency, adjusted. The System's holdings of bills discounted declined $3,000.000 and of bills bought in open market $1,000,000. Holdings of the various classes of Government securities were practically unchanged. Beginning with the statement of May 28 1930, the text accompanying the weekly condition statement of the Federal Reserve banks was changed to show the amount of Reserve bank credit outstanding and certain other items not included in the condition statement, such as monetary gold stocks and money in circulation. The Federal Reserve Board's explanation of the changes, together with the definition of the different items, was published in the May 31 1930 issue of the "Chronicle" on page 3797. The statement in full for the week ended Jan. 17, in comparison with the preceding week and with the corresponding date last year, will be found on subsequent pages, namely, pages 466 and 467. Beginning with the statement of March 15 1933, new items were included as follows: 1. "Federal Reserve bank notes in actual circulation," representing the amount of such notes issued under the provisions of paragraph 6 of Sec. 18 of the Federal Reserve Act as amended by the Act of March 9 1933. 2. "Redemption fund-Federal Reserve bank notes," representing the amount deposited with the Treasurer of the United States for the redemption of such notes. 3. "Special deposits-member banks," and "Special deposits-nonmember banks," representing the amount of segregated deposits received from member and non-member banks. A new section has also been added to the statement to show the amount of Federal Reserve bank notes outstanding, held by Federal Reserve banks. and in actual circulation, and the amount of collateral pledged against outstanding Federal Reserve bank notes. Changes in the amount of Reserve bank credit outstanding and in related items during the week and the year ended Jan. 17 1934 were as follows: Bills discounted Lille bought U. S. Government securities Other reserve bank credit Increase(+) or Decrease(-) Since Jan. 17 1934. Jan. 10 1934. Jan. 18 1933. S S $ 101,000,000 -3,000.000 -148,000,000 112,000,000 -1,000,000 +80,000,000 +654,000,000 2 432.000,000 1,000,000 -6.000,000 -8,000.000 TOTAL RESERVE BANK CREDIT2,646,000,000 -9,000.000 +578,000,000 Monetary gold stock 4 322,000,000 -1.000.000 -244,00f„000 Treasury currency adjusted 1 895,000.000 -55,00(.000 -16,000,000 Money in circulation 5 643,(00,000 -41,000,000 +41,000,000 Member bank reserve balances 2,788,000,000 +11,000,000 +243,000.000 Unexpended capital funds, non-member deposits, Ace 431,000,000 -36,000,000 4-34,000.000 Returns of Member Banks in New York City and Chicago-Brokers' Loans. Beginning with the returns for June 29 1927, the Federal Reserve Board also commenced to give out the figures of the member banks in New York City, as well as those in Chicago, on Thursday, simultaneously with the figures for the Reserve banks themselves, and for the same week, instead of waiting until the following Monday, before which time the statistics covering the entire body of reporting member banks in the different cities included cannot be got ready. Below is the statement for the New York City member banks and that for the Chicago member banks for the current week, as thus issued in advance of the full statement of the member banks, which latter will not be available until the coming Monday. The New York City statement, of Financial Chronicle 410 course, also includes the brokers' loans of reporting member banks. The grand aggregate of brokers' loans the present week shows an increase of $12,000,000, the total of these loans on Jan. 17 1934 standing at $758,000,000, as compared with $331,000,000 on July 27 1932, the low record for all time since these loans have been first compiled in 1917. Loans "for own account"increased from $605,000,000 to $608,000,000, and loans "for account of out-of-town banks" from $132,000,000 to $144,000,000, but loans "for account of others" decreased from $9,000,000 to $6,000,000. CONDITION OF WEEKLY REPORTING MEMBER BANKS IN CENTRAL RESERVE CITIES. New York. Jan. 17 1934. Jan. 10 1934. Jan. 18 1933. Loans and Investments—total 6 579,000,000 6,536,000.000 7,086.000,000 Loans—total 3,279,000,000 3,268,000,000 3,408,000,000 1,620,000,000 1,624,000,000 1,559.000,000 1,659,000,000 1,644,000,000 1,849,000,000 On securities All other 3,300,000,000 3,268,000,000 3,678.000.000 Investments—total 2,185,000,000 2,170,000.000 2,609,000,000 1 115,000,000 1,098,000,000 1,069,000,000 U. S. Government securities Other securities 846,000,000 37,000,060 Reserve with Federal Reserve Bank Cash In vault 879,000,000 1,099,000,000 37,000,000 41,000,000 Net demand deposits Time deposits Government deposits 5,335,000,000 5,260,000,000 5,845,000,000 696,000,000 697,000,000 914,000,000 224,000,000 272,000,000 102,000,000 Due from banks Due to banks 79.000,000 71,000.000 74,000,000 1 221,000,000 1,174,000,000 1,609,000,000 Borrowings from Federal Reserve Bank. Loanson secur. to brokers & dealers: 608,000,000 For own account 144,000,000 For account of out-of-town banks 6.000,000 For account of others 605,000,000 132,000,000 9.000,000 353,000,000 11,000,000 3,000,000 758,000,000 746,000,000 367.000.000 Total On demand On time Loans and investments—total 500.000,000 481,000,000 191,000.000 258,000,000 265,000,000 176,000,000 Chicago. 1 303,000,000 1,273,000,000 1,065,C00,000 582,000,0G0 579,000.000 643,000,000 280,000,000 302,000,000 282,000,000 297,000,000 361,000,000 282,000,000 721.000,000 694,066,000 422,000,000 437,000,000 284,000,000 435,000,000 259,000,000 230,000,000 192.000,000 Reserve with Federal Reserve Bank_ _ _ _ 324,000,000 42,000,000 Cash in vault 307,000,000 43,000,000 307,000.000 18,000,000 1 117,000,000 1,096,000,000 337,000,000 337,000,000 28,060,000 28,000,000 930,000,000 315,000,000 12,000,000 184.000.000 280,000,000 270,000,000 310,000,000 Loans—total On securities All other Investments—total If. S. Government securities Other securities Net demand deposits Time deposits Government deposits Due from banks Due to banks 182,000,000 294,000,000 Borrowings from Federal Reserve Bank_ 'Complete Returns of the Member Banks of the Federal Reserve System for the Preceding Week. The Federal Reserve Board resumed on May 15 1933 the publication of its weekly condition statement of reporting member banks in leading cities, which had been discontinued -after the report issued on March 6, giving the figures for March 1. The present statement covers banks in 90 leading .cities instead of 101 leading cities as formerly, and shows figures as of Wednesday, Jan. 10 1934, with comparisons for Jan. 3 1933 and Jan. 11 1933. As is known, the publication of the returns for the New York and Chicago member banks was never interrupted. 'These are given out on Thursday, simultaneously with the figures for the Reserve banks themselves, and cover the same week,instead of being held until the following Monday, before which time the statistics covering the entire body of reporting member banks in 90 cities cannot be got ready. In the following will be found the comments of the Federal Reserve Board respecting the returns of the entire body of reporting member banks of the Federal Reserve System for the week ended with close of business on Jan. 10. The Federal Reserve Board's condition statement of weekly reporting member banks in 90 leading cities on Jan. 10 shows decreases for the week of $197,000,000 in loans and investments and $141,000,000 in Government .deposits, and an increase of $60,000,000 in reserve balances with Federal .Reserve banks. Loans on securities declined $120,000,000 at reporting member banks In .the New York district and $123,000,000 at all reporting member banks. "All other loans" declined $27,000,000 in the New York district and $53,000,000 at all reporting banks. Holdings of United States Government securities increased $52,000,000 .in the Chicago district, and declined $19,000,000 in the New York district .and $13,000,000 in the Philadelphia district, all reporting banks showing a net increase of $5,000,000 for the week. Holdings of other securities declined $36.000,000 in the Boston district, $9,000,000 in the New York district and $26.000.000 at all reporting banks, and increased $11,000,000 in the .Chicago district. Borrowings of weekly member banks from Federal Reserve banks aggregated $21,000,000 on Jan. 10. or $4,000,000 less than the week before. Licensed member banks formerly included in the condition statement of member banks in 101 leading cities, but not now included in the weekly Jan. 20 1934 statement, had total loans and invetittilents of $965,000,000 and net:demand, time and Government deposits of $992,000,000 on Jan. 10, compared with $957,000,000 and $995,000,000, respectively, on Jan. 3. A summary of the principal assets and liabilities of the reporting member banks, in 90 leading cities, that are now included in the statement, together with changes for the week and the year ended Jan. 10 1934,follows: Jan. 10 1934. Increase (-I-) or Decrease (—) Since Jan. 3 1934. Jan. 11 1933. —289,000,000 Loans and investments—total_ _ _16,388,000,000 —197,000,000 8,209,000,000 —176,000,000 —525,000,000 3,497,000,000 4,712,000,000 —123,00f.,000 —53,000,000 —226,000,000 —299,000,000 8,179,000,000 —21,000,000 +236.000,000 5,210,000,000 2,969,000,000 +5,000,000 —26,000,000 +242,000,000 —6,000,000 1,983,000,000 248,000,000 +60,000,000 +1,000.000 —52,000,000 +60,000,000 10,951,000,000 4,343,000,000 571,000,000 —1,000,000 —8,000,000 —141,000,000 —281,000,000 —312,000,000 +313.000,000 1,210,000,000 2,804,000,000 —46,000,000 —24,000,000 —493,000,000 —568,000,000 21,000,000 —4,000,000 —12,000,000 Loans—total On securities All other Investments—total U. S. Government securities., Other securities Reserve with F. R. banks Cash in vault Net demand deposits Time deposits Government deposits Due from banks Due to banks Borrowings from F. R. banks British Government Calls £105,000,000 of Bonds. Holders of £105,000,000 of 4% Treasury bonds of 1934-36 were informed on Jan. 12 they would be repaid at par on April 15, which is the earliest date on which the Government has a right to repay them. These advices from London Jan. 12 were published in the New York "Times," which further reported: The transaction was not unexpected. Owing to the present easy monetary conditions the Government can replace the bonds at about half the coat of the existing securities which were issued in 1930. The Government has not disclosed how it intends to replace them. Increase Reported in British Postal Savings Deposits. A further expansion in the practice of thrift in Great Britain, perhaps due in part to improvement in the British economic position, has resulted in a marked increase in re. ceipts of the Post Office Savings Bank, according to a report from the American Consulate-General, London, made public by the United States Commerce Department. The Department reported the following on Jan. 16: There is now £320,000,000 in the Post Office Savings Bank, a total which is increasing each year, the report points out. During 1933 the total amount of savings invested in the Government institution rose by £26,000,000 against an increase in 1932 of .£11,000,000 over that of the preceding year. Withdrawals for Christmas and holiday spending were notably in excess of 1932, the report states. British Reported as Avoiding Equalization War— Disclosure Is Made that £350,000,000 Fund Was Never Used for Dollars—Pound Buying Doubted— Francs Regarded as United States Goal. From London Jan. 16 advices to the New York "Times" said: A significant fact not generally known and never before published is that not one shilling of England's Exchange Equalization Fund of £350,000,000 has ever been used to buy dollars since the United States went off gold last April. Nor is it expected that England will use her fund for purchasing American currency to control exchange now that the dollar is likely to be definitely depreciated to between 50 and 60% of its former value. These facts, both from the same authoritative source, were given to-day as part of an answer to a question whether America's proposed $2,000,000.000 exchange stabilization fund and England's fund would be used as weapons in a currency battle between the two countries. When England increased her equalization fund from £150,000,000 to .C350,000,000 last May, Neville Chamberlain, Chancellor of the Exchequer, asserted in the House of Commons that the increase had nothing whatever to do with the fact that the United States had gone off gold the month before. That is still the attitude of the British Government, despite what happened in Washington yesterday. President Roosevelt's message was discussed at to-day's meeting of the British Cabinet, but only as an interesting topic of conversation, rather than a matter demanding immediate action, it was said. Of course, if the depreciated dollar results in a flood of cheap American exports into British markets, the British Government is expected to consider the advisability of imposing anti-dumping duties. But that question does not arise now and may never arise. Neither do the British expect President Roosevelt to use his stabilization fund to buy sterling exchange. They predict that he will use it chiefly to buy French francs, because they are convertible into gold, the acquisition of which is considered here as part of the American policy. The British base this assumption on the use of their own equalization fund. With the exception of a few smattering transactions in Dutch guilders, all the British purchases to keep the pound steady have been of francs. Anchorage Is Factor. A further reason why London believes the United States will not purchase pounds in an effort to keep down the exchange value of the dollar is the fact that the dollar will now be anchored within comparatively narrow limits, while the franc is based on gold and the pound anchored to nothing at all. It is because of these facts and inferences that the British Government and bankers do not expect an Anglo-American exchange rate war. On the other hand. Britain has no intention of stabilizing with the United States on the basis of what is considered In London as a greatly Volume 138 Financial Chronicle undervalued dollar. A leading banker said to-day that if the United States should cease selling dollars they would immediately spring up to $4.50 to the pound because of their own inherent strength and resiliency. To-day's exchange rate furnished some evidence to support that foreign faith in the dollar. Last night Americans in London went to bed with the sad conviction that they would have to pay $5.30 for a pound to-day because that was the figure all the experts decided was the mathematical value of the dollar after President Roosevelt's message. But the highest price for the pound in London to-day was $5.15, and it fell as low as $5.07. This strength of the dollar was a mystery in the city. But four reasons were given for it by exchange experts. First, it was partly due to a considerable demand for dollars with which to buy American commodities. Second, there is now going on a great deal of repatriation of American balances from London, and from other places dollars are in homeward flight. Third, the strength of Wall Street inspired confidence in London. Fourth, was the covering of large short interests in dollars which had been bought forward by Paris through London. These factors are banked on here as future props which will prevent depreciation of American currency as against sterling to the level which is suggested by the mere mathematics of the situation. In other words, the British are watching to see what logical consequences trade and.commerce will bring about, and they would not be surprised if the depreciated dollar eventually hovered around its old parity of $4.86, which prevailed before either country abandoned gold. Temporary Advantage Is Seen. Taking a long view of the world situation, the British still have grave doubts about the results of President Roosevelt's policy. The devaluation phase of that policy will give American exporters the same advantage as that derived by the French when the undervalued franc was stabilized: also the same as that which British exporters had when this country abandoned gold. But the ramifications and consequences of America's following this course are bound to be more far-reaching, it is contended here. Unless the United States lowers tariffs or resumes lending abroad. the British hold, payments for her exports will drain the rest of the world of gold. France and other gold countries will have to abandon that standard, and the world will have to start all over again to consider its monetary systems. But it is admitted that that might be a good thing after all, provided the reconsideration did not begin in an atmosphere of hate or futility. *However, nobody in England is as yet talking about a world monetary conference. What is considered more likely as the next development after a period of watching the American effort, is a triangular effort of the United States, Britain and France to find a monetary solution. Policy Held Not "Serious." The "Financial News" suggested editorially that to-day's rise in the dollar "betokened a strong belief that President Roosevelt and his 60-cent dollar simply did not mean serious business." It added that the situation showed two main convictions: Firstly, the American authorities will not buy imported gold at the new upper limit of mint parity. Secondly, they will not persist in buying foreign currencies or gold abroad to a sufficient extent to drive the dollar down to the exchange level which 40% devaluation ought to give it. Sir Herbert Holt, President of Royal Bank of Canada, Urges Dominion to Lighten Tax Burden. A warning against the possibility of overburdening the Canadian people and industries with taxation is sounded by Sir Herbert Holt, President of the Royal Bank of Canada, in his annual statement to stockholders, copies of which have now been received by the New York branch of the bank. Sir Herbert said that there had been a distinct improvement in Canadian business since the last annual meeting of shareholders. "Unfortunately," he said, "the grain-growing industry has not yet shared in the improvement in any important degree. We can only hope that its recovery will not be too long deferred, and in the meantime, everything possible should be done to lessen our dependence on wheat and to diversify production in Western Canada." • Commenting on Canada's ability to profit from world recovery, Sir Herbert said; The country's position will be weakened fundamentally if we allow our costs to get out of line. Taxation is a growing item in the cost of production, and I cannot emphasize too strongly the vital importance of reducing this burden. The cost of maintaining our too numerous Governments, Federal, Provincial and municipal, is rapidly becoming unbearable. The gross debts of these Governments, including bonds guaranteed by the Dominion Government, increased from $4,188,000,000 in 1920 to $6,055,000,000 in 1931, with the Provinces and municipalities responsible for the major portion of the increase. Governments are only too prone to classify all their expenditures as essential, refusing to recognize that there are many desirable things which we cannot afford. If our industries and people are overburdened with taxation, we will not be able to hold our competitive position and at the same time maintain our standard of living. I am quite aware that in the past there has been a tendency to regard warnings of this kind as somewhat exaggerated or overdone, but unless a halt is called, the seriousness of the situation will Greater activity in very soon be brought home to every individual. business will reduce unemployment, produce increased revenues and a Advantages must be taken relief. public for reduction in disbursements of these developments to reduce debts, rather than increase expenditures. Administration Not to Discuss American Adherence to World Court at Present Session of Congress— "Complex Situation" in Europe Given as Cause for Delay. President Roosevelt has decided not to submit to the Senate at the present time the question of United States adherence to the World Court, it was announced on Jan. 4 by Senator Joseph T. Robinson, Democratic leader in the Senate, after a conference at the White House. It was 411 reported from Washington that no action on the Court protocols was to be expected during the current session of Congress. Senator Robinson said that the President's decision had been made on the ground that the "complex situation" in Europe made the present time inopportune for considering American adherence. A Washington dispatch of Jan. 4 to the New York "Herald Tribune" quoted Senator Robinson as follows: In announcing the sidetracking of the World Court, Senator Robinson said after his White House visit, "you may be interested to know we feel the situation in Europe is so complex that this is not the opportune time to proceed with the resolutions relating to the World Court. The World Court protocols have been kept in the Senate Foreign Relations Committee year after year despite negotiations of agreements to take care of most of the original amendments proposed in the Senate and despite the proposal of an additional reservation to prevent an advisory opinion by the court ins case in which the United States might be interested. Opposition to court membership, always vigorous in the Senate, is thought by Senate leaders to have increased recently with the impasse over world disarmament, the presence of war clouds in Europe as well as the Orient, and the departure of Japan and Germany from the League of Nations. Bank for International Settlements Sees Stabilizing Step in Monetary Move of United States—Setting of Dollar Limits is Believed Prelude to Fixing Ratio to Pound and Franc—Taking of Gold Deplored—Holds It a "Bad Example," Tempting Others to Play With Currencies. Good and bad are seen at the Bank for International Settlements in President Roosevelt's monetary message, according to a wireless message from Basle to the New York "Times," which went on to say: Fixing of the dollar at between 50 and 60 cents gold is welcomed as at least a step toward definite stabilization. There is no criticism of the Government's taking a so-called profit of the $4,000,000,000 involved in revaluation. It is pointed out here that in revaluation all governments have done this, but the $4.000,000.000 is considered as the yield of a capital tax of 40 to 50% levied on the American people rather than as a windfall taken from the Federal Reserve banks. The Government's taking ownership of all gold, however, is deplored as "a backward step" and even more as "a bad example to less stable governments." A world-wide trend among monetary experts toward freeing monetary systems and central banks from political control has been evident for some time. In no important country now, it is stated here, does the government still own the gold reserve. Fear of Playing With Currencies. It is conceded that the effects of Government ownership of gold will probably be "least bad" in the United States because its Government changes relatively slowly, but it is greatly feared that the governments of other countries, where cabinets change every few months and which have been persuaded with difficulty to forego playing with their currencies, will "backslide" with very costly results, internally and externally. This fear in itself, banking officials believe, would hinder the recovery of confidence generally, and so, too, would the chief thing apparently feared in United States gold ownership, namely, that the Treasury will find the temptation to play with the valuation of gold irresistible whenever it actually needs to make important foreign gold shipments to meet American balances of payment. Maintenance of a "threat" of a commodity dollar is also deplored as a disturbing factor because it is held to render impossible the restoration of any international monetary standard. Continuance of the American commodity dollar experiment being in contradiction with fixing the dollar's value between 50 and 60 cents, some here think that the talk of the former was meant by Mr. Roosevelt to Improve his bargaining position in the next step of fixing definitely the ratio of the dollar to the pound and the franc. Question of Devaluing Abroad. The World Bank's telephonic contacts with European central banks indicate that Mr. Roosevelt's message has been received with relief in France and other gold countries but that it has greatly disturbed England and the sterling area. The latter, it is explained, had got down to the internal price level which they thought they ought to have and the American move now practically upsets this by forcing them either to depreciate the pound to get the old 4.86 ratio to the dollar or to accept the trading disadvantage of the present 5.20 ratio. They feel, moreover, that if they readjust to meet the dollar, the gold bloc may then readjust also, throwing them out of kilter again. This belief that the gold countries, particularly Holland and Switzerland, which never have devaluated, will devaluate down to the former parity with the dollar once the dollar is stabilized definitely, is not shared in the World Bank, partly "because this would be the scientific thing to do, and no country over does the scientific thing." The gold countries, however, will be the only ones to profit by a 40 to 50% reduction in their war and private debts to the United States which the devaluation of the dollar gives them. The American Treasury's"profit" of $4,000,000,000 through devaluation compares with a windfall of $10,000,000,000 to the war debtors which stick to gold. Among the private debtors, Germany, it is pointed out here, will be the greatest beneficiary of Mr. Roosevelt's move, which will involve a remission of $800.000.000 on her commercial debt. All of the above views were qualified at the World Bank as rest impressions. Van de Lubbe, Reichstag Incendiary, Executed in Leipzig Despite Protests by Dutch Government. Marinus van der Lubbe, Dutch citizen who confessed setting fire to the building of the German Reichstag on Feb. 27 1933, was executed at Leipzig on Jan. 10 by means of the guillotine, despite previous protests by the Dutch Government, based on the application of the death sentence to one of its nationals by virtue of a retroactive law. President von Hindenburg refused to issue a pardon or commute the sentence passed Dec. 28 by the German Supreme Court. Financial Chronicle 412 The four co-defendants of Van der Lubbe are still under detention, although they were acquitted of complicity in the crime. The Reich authorities also refused requests to return Van der Lubbe's body to Holland, and he was buried in Leipzig Jan. 15. Austrian Economic Gains Noted in Report of League of Nation's Financial Committee. Under date of Jan. 14, Geneva advices to the New York "Times" said: The improvement the League's financial committee noted in Hungary and Bulgaria It reports now in its other ward, Austria. "A marked strengthening of confidence in the national currency has for some time been observable," it says,"together with an increasingly distinct tendency toward repatriation of capital. "The falling off of economic activity which continued in 1932 and the first months of 1933 appears to have ceased in recent months. In some directions there has even been improvement. "The number of unemployed at the close of the year was lower than a year ago. Railway carloadings have been higher since September than for the corresponding months of 1932. The volume of foreign trade for some months has been appreciably higher than the corresponding figure for last year, although the import surplus is distinctly less." Financial Committee of League of Nations Finds Bulgaria Improving Economically. The Financial Committee of the League of Nations, after studying the situation in Bulgaria, reported on Jan. 12, that for the first time since the depression there is an improvement, coupled with a record crop and the sound policy of the Bulgarian National Bank. Geneva advices Jan. 12 to the New York "Times" went on to say: The League Commissioner for Bulgaria flatly declares, however, that the Improvement is in no degree due to the Bulgarian Government's action and says things have grown worse in every field in which its influence has dominated. German Fundamental Labor Code Outlaws Unions, Strikes and Lockouts After May 1— Measure Nullifies All Labor Legislation Since 1918—Individual Employer Vested With Supreme Authority—Hailed as Chancellor Hitler's Greatest Revolutionary Deed. A new German labor code, published Jan. 16, to become effective May 1, abolishes all trade unions and outlaws strikes and lockouts. It nullifies practically all labor legislation passed since the establishment of the German Republic in 1918, and replaces the system of collective agreements between employer and employee with a semifeudalism based on the supreme authority and personal responsibility of the individual employer. The new law was called by Reich officials the greatest revolutionary accomplishment of Chancellor Hitler, and before its details were made public 200,000 Nazis celebrated its proclamation by mass meetings in Berlin on Jan. 14. The law undertakes to establish a new fundamental constitution for employers and employees in all establishments employing more than 20 persons. It will be supplemented by executive decrees later. A Berlin dispatch of Jan. 16 to the New York "Times" outlined the principal provisions of the measure in part as follows: New There is little doubt that in organized labor circles abroad the code will not be called revolutionary but reactionary. For it abolishes all those rights and privileges on which the organized labor movement rests. It annihilates the labor unions themselves, prohibits strikes and does away with collective bargaining and the right to organize. Beyond this it also abrogates 11 laws, including those in which are Incorporated the special achievements of German labor during the Socialist revolution of 1918. Nevertheless the code is designed to carry out the "socialist" part of the National Socialist program. For that purpose it proclaims two principles and replaces the organizations of "Marxist class warfare"—the labor unions and the employers' associations—with a new labor organization. The first of the principles is "social honor," which henceforth is to govern all German employers and employees. The second is "leadership in business," the employer becoming the leader and the employees becoming the followers. The new labor organization is a system of shop councils which will function under the supervision of governmental "labor trustees," but which within minimum provisions will permit the employer to fix wages and working conditions himself although the workers get the right to appeal to the State. "Leader" Makes Decisions. Paragraph 2 of the code reads: "The leader of the undertaking decides in respect to the followers all matters relating to the undertaking. He must care for the welfare of the followers. These must accord him the loyalty demanded by the shop community." The employer is also to be chairman of the shop council, which for the rest is to be formed of elected "nationally reliable employees" more than 25 years old and at least one year in the undertaking. The shop council is to promote mutual confidence, advise on working conditions and try to settle all disputes. The ultimate decision rests with the employer. but the shop council may by majority vote appeal to a labor trustee. These trustees, of whom there will be 13, are to be appointed by the Government for the larger districts. Their task is to preserve labor peace, work out general regulations for wages and working conditions and supervise their execution. Jan. 20 1934 Each shop leader is to work out his own shop code, which may also fix a wage scale. This scale must contain a minimum wage and leave room for higher pay for better work. "Social Honor Courts." Within each labor trustee's district a "social honor court" will be set up which will try employers who "maliciously exploit the labor of their followers or insult their honor" and workers who "through malicious agitation endanger labor peace within the shop, deliberately interfere with the management or make frivolous complaints to the labor trustee." The trustees themselves may impose fines and prison terms, and the court may beyond that also depose a "leader" and discharge a "follower." For the protection of the workers it is provided that mass dismissals and shutdowns must be preceded by four weeks' notice, which may be prolonged to two months, and that in the case of individual dismissals the worker may sue for reinstatement or a settlement amounting at the maximum to one-third of his annual earnings. German Reichsbank Won't Admit Rebuying of Bonds Except in Accordance with Its Rules. The German e ehsbank authorities do not admit that German dollar bonds are being repurchased abroad except in accordance with its re7ulations, said wireless advices Jan. 13 to the New York "Times," from which we also quote: It is asserted that it would indeed be impossible to market in Germany surreptitiously repurchased bonds. Since June 1933 there has been no regular amortization of German external bonds except for the Dawes Loan. Profits on repatriation through repurchases at times have exceeded 80%, many bonds having been bought at prices below 20. But this is held to represent merely a book gain of such debtor corporations as directly rebought their own issues. In general, repatriated bonds, acquired abroad at prices depreciated much more than 50% of par, were remarketed on the Berlin Boerse at prices substantially higher, up to 80 before the June interest default, and at present between 45 and 60. Indeed, much higher than 80 and over are the present prices for German dollar bonds newly converted to a reichsmark basis, such as Rhenish Westphalian Electricity 7s due in 1950, quoted at 95, against around 62 currently in Wall Street, German Dollar Bonds in Default Total $916,509,100, According to Max Winkler—Regards Dr. Schacht's Plea of Poverty as Not Likely to Impress Those Familiar with His Attitude Toward Germany's Foreign Creditors. Under date of Jan. 7 Max Winkler, President of the American Council of Foreign Bondholders, Inc., stated that the amount of German dollar bonds in default has reached the impressive total of $916,509,100. Mr. Winkler added: Although a German law passed under date of June 9 1933, providing for the suspension of payment in foreign currency but for the deposit of marks to the credit of bondholders, such deposits to be transferred in cash as to 50%. was to become effective as from July 1 1933, American holders have received nothing to date. Moreover, if some or even a majority were to accept the German plan of payment, the fact remains that it constitutes a distinct violation of original loan agreements, so that one is fully justified in looking upon German dollar bonds as being in complete default at present, and in partial default as soon as the above plan will be in operation. Dr. Schacht and his cohorts have been laying the blame for the delay in the disbursement of the 50% cash payment to the slowness with which matters have been handled by Washington. Dr. Schacht may not be aware of what America is fully conscious, namely that the scrip which is to be issued to holders of German bonds will be purchased by Germany at half their face value, on condition that the transaction will increase Germany's foreign commerce. In other words, foreign importers of German merchandise will be able to purchase 100 marks worth of German goods for only 50 marks, and, since the inherent position of the reichsmark Is such as to Induce foreign owners to part with the currency at so marked a discount in relation to the officially quoted price, the supply of marl, may be expected to be quite plentiful. In this way, German shippers are being placed at an unfair advantage over merchants in other countries. It 111 for these reasons that the authorization to distribute scrip and cash to bondholders may have been delayed. German bonds, interest and amortization on which, due in JanuarY, are not scheduled to be met according to provisions of original loan agreements, are tabulated hereunder: Original Amount. Amount Interest Sink, Fund Outstanding. Due. Due(Est.). A. Government and Political Subdivisions (Direa & Contingent) Cons. Alunic. Baden 78 Bavarian Palatinate 78 Heidelberg 7M5 Central Bank for Agriculture 68 Cons. Hydro-Elec. of Upper Wuerttemberg 7s Rhine Ruhr Water 68 Saxon Public Works 68 $ s $ 4,500,000 3,691,500 258,405 3,800.000 3,134,500 219,415 1,500,000 1,287,000 96,525 30,000,000 23,100,000 1,386,000 Total B. Banking Institutions— German Bldg. ci, Land Bank 00. C. Public Utilities— Westphalia Unit. El. 68 D. Industrial Enterprises— German General Electric 78 Harpen Mining 68 Rheinelbe Union 78 Siemens-Halske 78 Stinnes (Hugo) 7s Tietz (Leonhard) 734s United Steel Works tiMs 60,285,0.0 49,651,000 3,105,335 1,036,665 Total Grand total Defaults, July-December 4,000,000 10,000,000 6,485,000 5,250,000 3,671,000 8,900,000 5,867,000 4,981,000 258,970 534,000 352,020 $ 90,000 200,000 30,000 450,000 66,665 200,000 323,765 52,500 20,000,000 19,357,000 1,161,420 240,000 7,700,000 539,000 8,700,000 522,000 20,600,000 1,442,000 2,900,000 203,025 4,900, MO 343,000 1,950,000 146,250 22,500,000 1,462,500 250,0 0 250,000 625,0 0 132,000 10,000,000 10,00'MOO 25,00.`,000 5;100,000 12,500,000 3,000,0 0 30,00,00' 75,000 400,000 95,500,000 69,250,000 4,657,775 1,732,000 181,35,000 143,239,000 9,248,295 3,061,165 909,715,000 773,569,600 9,707,175 10,297,675 1,090,750,00 . 916,808,600 18,955.470 13.358.840 The amount representing the interest due in the above table includes both the July and the January coupons. The same applies also to sinking fund payments. Total defaults Volume 138 Financial Chronicle Those familiar with Dr. Schacht's attitude toward Germany's foreign creditors are not likely to be impressed with his renewed plea of poverty and consequent inability of the Reich to meet contractual commitments. Although conceding that in appraising German trade figures one will have to allow for the purchase of a very large volume of merchandise either with blocked marks at a substantial discount compared with officially quoted figures, or through tendering German external loans,the head of the Reichsbank seems to ignore the fact that reduced trade is offset, to a very appreciable extent, by the premium which the reichsmark commands over the dollar and the pound, the two currencies in which the bulk of Germany's engagements are payable. For the first 11 months of last year the country's excess of exports over Imports was officially given as 618,000.000 reichsmarks, compared with 1,030,000.000 reichsmarks for the corresponding period in the preceding year. At prevailing rates of exchange, however, the former figure is equivalent to about $231,750,000, while the export surplus for the first 11 months of 1932, converted at the rate of exchange obtaining during that period, amounted to $245.150,000, a decline of less than 5%,and more than neutralized by the huge reduction which has admittedly been effected in the amount of Germany's foreign indebtedness. On the basis of statistics furnished by the German Government statistical bureaus to and published by the League of Nations in its monthly "Bulletin of Statistics," the subjoined figures should prove of extreme help to those who may endeavor to comprehend the lament of the Reichsbank President. Taking 1932 statistics as a base, that is 100, salient Indices relative to Germany's present economic and financial status are as follows: General index of production 116.00 Index of retail prices 97.93 Output of textiles 113.75 Commercial bank deposits 91.25 Output of machinery 111.72 Savings bank deposits 105.78 Output of coal and lignite 104.31 Index of stock exchange prices__ __132.48 Output of pig iron 134.14 Number of unemployed 62.19 Output of steel 133.82 Quotation of mark (in dollars)____157.57 Output of zinc 115.93 Average monthly imports— Railway freight traffic 99.93 January to November 1933_..125.78 Net tonnage of vessels entered 110.15 Average monthly exports— Net tonnage of vessels cleared 105.21 January to November 1933_a__153.38 Index of wholesale prices 97.60 *At prevailing rates on New York. a At par of exchange. Strength in German dollar bonds, despite continued non-payment of Interest, intimation that the proposed 50% cash disbursement would once again be postponed till Jan. 24, and threats by Dr. Schacht that the cash payment for the first half of the current year would be reduced to 30%, has been decidedly puzzling, to say the least. It will be recalled that offers have been made to holders of German dollar bonds to convert them into mark obligations bearing a lower rate of interest, conversion to be effected on the basis of approximately prevailing quotations for the mark in terms of dollars. In addition, importers of German merchandise are in a position to tender, under certain conditions, such bonds in payment for German goods, the exporter in Germany accepting these bonds at a very substantial discount, even though at a figure somewhat In excess of prevailing quotations in foreign markets. While such transactions are bound to result in an increase in German export statistics, the gain so recorded is apparent rather than real, because It does not constitute an influx of new funds into Germany, but represents to a large extent a material reduction in the amount of foreign balances presently tied up in the Reich. In his latest report regarding the status of German external commitments, Dr. Schacht calls attention to the above. What is, however. difficult to explain is the fact that Dr. Schacht, in his earlier talks, enver failed to emphasize the impressive gains which have been registered in the various branches of Germany's economy. Why it was necessary for the head of the Reichsbank to wait until the United States Government officially protested Germany's refusal to meet the service on her contractual commitments, is somewhat difficult to explain. American holders of German bonds should not be misled by the sharp gains scored by various Issues, notably those outstanding on behalf of corporations. How much farther the rise is likely to continue, the writer is not in a position to state, but it should be borne in mind that as soon as the demand for bonds in payment for German goods will cease, reaction is likely to occur. Investors in German issues will do well to bear this in mind. Cuban Decree Suspends Payments Required to Be Made to Chase National Bank Under Public Works Law. Havana advices in the "Wall Street Journal" of Jan. 15 said: President Gran San Martin, on Saturday. signed a decree providing for provisional suspension of payments required to be made to the Chase National Bank from 90% of taxes created under the Public Works law of 1925, and restitution from the Public Works fund of moneys which wereimproperly taken from other sources to enable payments in excess of 90%. It is estimated by the Government that excess payments into the Public Works fund amounted to $3,000,000. but substantially larger amounts had been taken from this fund for other national expenditures by the Machado regime. Franco-Soviet Trade Treaty Signed at Paris—Pact Seen as Political Tie Between Two Nations— Debts Are Ignored. A new Franco-Russian commercial treaty was signed in Paris on Jan. 10, after negotiations lasting more than a year. Both French and Soviet spokesmen remarked that the political importance of the treaty outweighed its economic value, and it is expected to exert a favorable effect on relations between the two countries. A Paris dispatch of Jan.9 to the New York "Times," after noting the completion of the pact, added: In reaching the present commercial agreement, many formidable obstacles have been overcome. An initial difficulty over Russian debts is understood to have been avoided by ignoring them for the present discussion. Nevertheless, the new spirit of animation in the negotiations has inspired now hope in the holders of old Russian bonds which the slender market for them has quickly reflected. The Russian Consolidated 4% 1,000-franc bonds, which two years ago were a drug on the market at 5.45 francs apiece, were quoted to-day at 32.50. The 4% bonds of 1890 are selling at 14.50 and those of 1893 at 13.75. Russia's declining oil exports to France which were off 13% last year, will be braced by the new agreement. The exact terms have not yet been revealed, but France long has been Russia's largest oil customer. Last year France took from Russia a total of 3,700,000 quintals of refined oil 413 at a cost of 180.000.000 francs. The anthracite difficulty, due to protests by both French miners and the British against any increase in French Imports of Russian coal, also has been overcome. This, however, was a minor difficulty, as French imports of Russian coal last year amounted to only 300,000 tons. Is is understood the treaty provides for larger French imports not only of coal, but also of wood, flax, metals, hides and furs. kw. 4 The new political manifestations are understood to have resulted in France obtaining from Russia equally favorable credits to those formerly granted to Germany alone. This is likely to result in the transfer of more Russian business from Germany to France. Nicaragua Exchange Rules Eased—Permits Purchase by Exporters of Funds in the Open Market. According to Managua advices Jan. 15 to the New York "Times" a recent government decree gives exporters free use of larger percentages of the product of foreign exchange to apply in payment for their imports, with the privilege of negotiating for exchange in the open market. The advices added: • Nicaraguan banks have a fixed rate of 101% cordobas for $100. In the open market $100 will buy 110 to 115 cordobas. This measure is expected to stimulate imports and to insure prompter payment. Argentine Pesos Pegged to Sterling. According to the Brooklyn "Daily Eagle" of last night (Jan. 19), the Central Hanover Bank & Trust Company has received the following cable from Buenos Aires: Commencing to-day the official buying rate for Argentine paper pesos will be pegged to the pound sterling instead of to the French franc on the basis of 5 paper pesos to 1 pound sterling. Buenos Aires (Argentine) to Make Payment on 634% External Sinking Fund Gold Bonds of 1930 at Rate of $27.40 for Each $32.50 Coupon and $13.70 for Each $16.25. Announcement is made that the Province of Buenos Aires, Argentine Republic, has made available at the First of Boston International Corporation, for delivery,on or after Feb. 1 1934 to holders of 63/2% external sinking fund gold bonds of 1930, due Aug. 1 1961, who assent to the Province of Buenos Aires Loan Readjustment Plan of 1933, the sum in cash of $27.40 with respect to each $32.50 coupon, and $13.70 with respect to each $16.25 coupon maturing Feb. 1 1934, together with 5% arrears certificates for the balance remaining unpaid on such coupons. Blanton Winship Appointed Governor of Puerto Rico as Robert H. Gore Resigns—Many Factions in the Island Welcome Change—President May Assign Gore to Another Post. President Roosevelt on Jan. 12 announced the resignation of Robert H. Gore as Governor of Puerto Rico, and on the same day sent to the Senate the nomination of Major General Blanton Winship, retired, for that post. The resignation of Governor Gore had been generally anticipated in Washington, both because of his poor health and that of Mrs. Gore,aggregated by their residence in a subtropical climate, and also because of a chain of political happenings in Puerto Rico which had resulted in demands by certain factions for his removal. It was unofficially reported that the President might appoint Mr. Gore to another Federal post. In accepting his resignation, the President invited him to "drop in" as soon as his health permitted, as "I want to have a talk with you." A Washington dispatch of Jan. 12 to the New York "Times" continued, in part, as follows: General Winship, who retired Nov. 30 from the post of Judge Advocate General, is one of the most experienced officers of the army colonial service. A native of Macon, Ga.. he began his military career in 1898, serving through the Spanish-American War and the Philippine Insurrection and with the Army of Cuban Pacification. He was with General Funston in Vera Cruz in 1914 and in the World War was staff officer and judge advocate of the 42d Division. The peace-time service of General Winship, however, dictated his choice for the new appointment. He made an enviable record when, from 1906 1909, he served as Acting Secretary of State and Justice in Cuba under General Crowder. In Mexico he was Judge Advocate. After serving as military aide to President Coolidge, General Winship, from 1928 to 1931, was legal adviser to the Governor General of the Philippines. Last year he was sent to Liberia to define the relations of this government with the African Republic in view of forced labor and other unsatisfactory conditions. Letters on Resignation. Governor Gore's letter of resignation read: Hon. Franklin D. Roosevelt, President of the United States, The White House, Washington, D. C. Jan. 8 1934. My dear Mr. President: As you know, the climate in Puerto Rico has not been conducive to my own health or that of the members of my family. I have had to return to the United States on two occasions to regain my health. My family returned in November and Mrs. Gore is now ill. Since my return to the States in November, my own health is much improved, and I do not want to jeopardize my physical condition by returning to Puerto Rico. 414 Financial Chronicle I wish, therefore, to tender my resignation to become effective at your convenience. I want you to know that you will have my loyalty and co-operation as always. Sincerely yours, BOB GORE. In reply President Roosevelt wrote: The White House, Washington, Jan. 12 1934. My dear Bob: It is with sincere regret that I accept your resignation. I appreciate fully your reasons for wanting to be relieved as soon as possible and I sincerely hope that you will soon be feeling fit again. I want you to know how much I appreciate your loyalty and continued co-operation in the difficult times through which we have been going. Drop in as soon as you have fully recovered. I want to have a talk with you. Very sincerely, FRANKLIN D. ROOSEVELT. Hon. Robert H. Gore, Washington, D. C. We quote in part from radio advices of Jan. 12 to the "Times"from San Juan: Within an hour after the first news of Governor Gore's resignation and General Winship's nomination reached La Fortaleza this afternoon, Mundo" had a single sheet, 1-cent extra on the street, giving the text of Mr. Gore's letter and the President's note of acceptance. Other than the cabled dispatches,"El Mundo" made no comment save to note that Mr. Gore, in his letter made no reference to his political difficulties during his breif administration here. The news brought an immediate cheerful and hopeful reaction, due to the fact that uncertainty over Mr. Gore's resignation had finally been cleared and to the President's immediate action on his successor, both of which were announced in the same dispatch. That Mr. Gore would return after his departure in November with his family was increasingly doubted here, although what was construed as variance in his own statements led to uncertainty of opinion as to when be might retire. Even since the holidays he has sent messages fixing different dates for returning. Filipinos Submit New Independence Proposals to President Roosevelt as Hawes-Cutting Act Expires— Quezon Plan Said to Provide for Freedom Within 3 Years with Preferential Trade Relations. The Hawes-Cutting Act, which would have granted the Philippine Islands their independence within a period of twelve to fifteen years, expired on Jan. 17, one year after the date of its passage, because its terms had been rejected by the Philippine Legislature. On the same day Manual L. Quezon, majority leader of the Legislature, presented to President Roosevelt a new proposal for the Island's independence, but the contents of the plan were not made public. The proposal was drafted in response to a suggestion made to Senator Quezon's mission by President Roosevelt at a White House conference Dec. 27, when he asked the Philippine delegation to draft a substitute bill. Associated Press advices of Jan. 17 from Washington outlined the chief provisions of the new plan as follows: The new plan, prepared by a delegation headed by Manual L. Quezon, President of the Philippine Senate, was understood to ask for independence within two or three years, provided Congress would grant the Philippines preferential trade relations for ten years, or as an alternative suggested absolute independence on July 4, 1940. President Roosevelt had requested submission of the report. Mr. Quezon was understood to have summarized the main proposal as follows: "If the United States could be persuaded that for a period of ten years after independence shall have been granted. Philippine products would be allowed to enter the United States free of duty, limiting the amount of sugar exports to 1.000,000 long tons, of oil to 200,000 tons and of cordage to 6,000,000 pounds,in exchange for the unrestricted importation of American articles and goods into the Philippine Islands, we believe that the granting of independence within two or three years will entail no ill effects upon the United States or the Philippines." A reciprocal trade arrangement was also suggested. Under the alternative the mission suggested establishment of a more autonomous government during the six-year period in order to prepare the islands for self-government. Sugar and cordage importations by the United States would be limited to the average of 1932 and 1933 imports and free importation of cocoanut oil would be held to 200,000 tons annually. This proposal also called for a trade conference after independence to adjust trade relations between the two countries and a neutralization treaty for the Philippines was suggested. The future of the plan remained in doubt because of general apathy on the subject on Capitol Hill. where leaders were somewhat resentful of the Philippines' rejection of the first definite independence program ever offered to them by the United States. Liberia Rejects League of Nations Plan for Dictatorship by White Corps of Experts—Republic Insists on Retaining Elected Native Officials—Not in Favor of Adding to Financial Burdens by Taking on • New Loan. The Republic of Liberia has rejected a plan sponsored by the League of Nations to rescue the Government from its financial difficulties by installing a white corps of experts to conduct the Government for five years, according to a cablegram received Jan. 14 from President Edwin Barclay by Lester A. Walton, Negro journalist, of New York City. The New York "Herald Tribune" described the program and the cablegram of rejection as follows on Jan. 15: Jan. 20 1934 The rejection of the plan was in the form of a decision by the Legislature at Monrovia, Liberian capital, to accept with reservations. The reservations are the same ones which L. A. Grimes, Secretary of State of Liberia and delegate to the League of Nations, made at the League Council's meeting last October. The Council then found them unacceptable and gave Liberia until Jan. 15'to accept the plan of League assistance as it was offered. Text of Cablegram. The cablegram from President Barclay to Mr. Walton, dated Jan. 13, as was follows: "Legislature decides to accept League plan assistance subject to reservations intimated to Council by Secretary Grimes when you were in Geneva. Legislature refuses to agree to provisions for suggested supplementary agreement of Finance Corporation of America and has authorized President to open up further negotiations with this Corporation with view of coming to more acceptable arrangement. In event acceptable arrangement is concluded between Government and Corporation and acceptance by League Council of reservations by Liberian Government League plan might likely go into effect but not otherwise." The supplementary agreement with the Finance Corporation of America, representative of the Firestone rubber interests, which lease the fourth largest rubber estate, provided for the issuance of new bonds to take up interest in arrears on a previous loan to the Liberian Government and to start the work of the expert advisers sent to Liberia under the auspices of the League. The Liberian Government. according to Mr. Walton, has taken the position that it does not wish to add to its financial burden by taking on a new loan. The offer of the Firestone financiers to cut the interest rate on the old loan from 7 to 5% has also failed to satisfy the Liberian Government. Virtual Dictatorship Rejected. The principal objection of the legislators, however, to the League plan, Mr. Walton said, was that it made all officers of the elected government subject to the authority of the League officials, among whom the chief adviser would be a virtual dictator for the country. The reservations offered by Secretary Grimes, and rejected by the League, would have made the advisers subject to the departmental chiefs of Liberia, and their appointments subject to ratification by the • Liberian Senate, which is modeled on the United States Senate. Liberia, which is about the size of Ohio, was founded more than a century ago by the American Colonization Society, and has adapted to its use many American customs. United States Claims Against Soviet Russia Put at $623,000,000—Russia Reported as Showing Wilingness to Waive Demands on 1918-19 Murmansk Expedition—Interest Is Not Figured. American claims against Russia, which must be settled before the question of granting credits to the Soviet is considered, have been placed in an official estimate at $623,000,000, said a Washington account Jan. 14 to the New York "Times," which went on to say: The Soviet Government, which during the exchange of communications between President Roosevelt and Maxim Litvinoff that preceded recognition, formally renounced all claims for damage caused by the American Siberian expedition, also shows willingness to waive claims in connection with the Murmansk expedition of 1918-19. In the discussions to start within two weeks between State Department on officials and Ambassador Troyanovsky, this second American venture , Russian soil is not, accordingly, expected to play an important part. gesture, considerable a made have will Soviet In letting it drop the counterbalance since it had been expected that much would be made of it to United States claims. the expedition, Siberian In waiving all claims in connection with the patent—that Russians had merely acknowledged what had always been of the participation their interests benefited rather than suffered because of the United States in a general Allied manoeuvre. follows: American claims against Russia are made up as $187,000,000 United States Government loans Government 86,000,000 Privately held bonds of the old Russian or industries for Private claims of American nationals, banks 350,000,000 confiscation of property If accrued interest on the Government war loan were reckoned, it would unlikely, are American negotiators total. the add another $139,918.590 to however, to insist on this. This situation is already thorny enough, since the President cannot reduce a Government loan without the assent of Congress, and the Soviets cannot recognize liability without setting a precedent for their other creditors. The Rapallo Treaty, for instance, specifically gives to Germany the right to claim equal treatment with all other countries in this regard. To find a formula which will satisfy American claims in whole or in part without compromising the Soviets with their other creditors is the difficult task before the negotiators. It must be performed if credits are to be granted and without credits—Ambassador Troyanovsky has already frankly declared—there can be no large amount of trade. If sufficiently large credits were granted, Soviet Russia could and would place something more than $500.000,000 worth of orders in this country, but if she cannot order goods without credits, her prospects of discharging $623.000,000 worth of claims without them also seem remote. Senate Confirms William C. Bullitt as Ambassador to Soviet Union—Senator Robinson of Indiana Only Opponent to Nomination. William C. Bullitt was confirmed by the Senate on Jan. 11 without a roll call as the first United State Ambassador to the Soviet Union. The only open opponent to Mr. Bullitt's nomination was Senator Robinson of Indiana, although criticism of the present Russian regime and of Soviet leaders was expressed by other Senators. A Washington dispatch of Jan. 11 to the New York "Times" noted this debate as follows: Heads of the Soy et regime were, however, sharply warned by Senator Vandenberg that they must live up to the pledges against subversive propaganda and other practices which Maxim Litvinoff furnished to President Roosevelt. "Continuity of these pledges in good faith is the price of the continuity of relations," the Michigan Senator declared emphatically without contradiction or demur from administration leaders. Volume 138 Financial Chronicle • Commenting on the "irony" of sending a man named "Christian" to Russia, Senator Vandenberg said he had hitherto opposed recognition because no country which outlaws God can rise among nations—but seems destined for spiritual bankruptcy. He added that Russia has a right to her own form of Government, but demanded that she must refrain from subversive propaganda here. He said he had wished to know if absolute pledges to cease this "imported treason" had been given, and therefore had reviewed the Roosevelt-Litvinoff correspondence. This, he stated, had appeared to him "about as complete a contract as can be drawn." But he proceeded: "I do not want any one beyond the seas to think these guarantees must not be primary,fundamental and continuous. Good faith is the test of the pledge. If any such promise is made with the tongue in the cheek there can be no chance for continuous relations." Opposition to Russian recognition as a principle and to Mr. Bullitt for the particular post was expressed by Senator Robinson. He said this country proposed to lend Russia $500,000,000 in addition to $700,000,000 "she now owes." The administration, he asserted, could not have "chosen a worse time" for recognition on account of the "delicate situation" in the Far East. "The Japanese situation is always dangerous and never more dangerous than now," he stated. Six Foreigners Arrested in Soviet Union, Charged with Economic Espionage—Twenty Russian Employees of Swiss Company Also in Custody. Charges of economic espionage have been placed against the general manager and five foreign representatives of the Controll Co., a branch of Societe Generale des Surveillances, Ltd., of Geneva, it was revealed on Jan. 14 following the arrest of the six foreigners by Soviet police at Moscow. The company is an international organization which certifies exports to principal ports throughout the world. Twenty Russian employees of the firm were also taken into custody. Associated Press advices from Moscow Jan. 14 gave the following additional details: 415 Robert R. Atterbury, Arthur F. Broderick, Lawrence G. Payson and Herbert G. Wellington were re-elected to the board of directors for the term ending 1937, the Exchange announced. Laurence G. Payson, President and other officers, were reappointed. All officers were re-elected at the annual election of the New York Quotation Co., another subsidiary of the Stock Exchange, held Jan. 9 and Oliver C. Billings, Howard C. Foster, George U. Harris, Bertrand L. Taylor, Jr., Erastus T. Tefft, Blair S. Williams and Dean K. Worcester were re-elected directors. Suit Filed Against New York Stock Exchange Incident to Plans Last Year to Move Exchange to Newark. A suit for $250,000 growing out of the preparations of the New York Stock Exchange to move to Newark, N. J., last September was filed on Jan. 3 in the New Jersey Supreme Court by Herbert J. Hannoch, receiver for the City Center Corp., at that time occupant of the Centre Market Building, in which the New Jersey Stock Exchange was to have been established. A Newark dispatch Jan. 3 to the New York "Times" added: The corporation was ousted from the building on Sept. 23. Nineteen defendants are named in the suit, among them the New York Stock Exchange and its President, Richard Whitney; the City of Newark and Mayor Meyer Ellenstein and A. F. Minis', City Commissioner. Companies that handled details of the plan, as well as contractors who worked on alterations for the proposed exchange, also are named. Montreal Stock Exchange Amends By-Laws to Fix Special Commission Rates for Non-Member Firms Operating Through Exchange Members. The foreigners under arrest are two Austrian subjects, two Germans, one At a special general meeting of the members of the MonBelgian and one Dane, all of whom have represented the company for treal Stock Exchange on Jan. 15, an amendment to the bymany years in this country. They, along with the Russian employees, were arrested over a period of four months beginning in September and ending laws was adopted authorizing a special rate of commission late in December, it was revealed. So closely were they confirned, however, to non-member financial houses doing business on the Monthat not even members of the foreign legations of their respective countries treal Stock Exchange through an Exchange member. were permitted to see them. No mention of the case has been published officially in Moscow, and as In order to receive this privilege non-member houses must the men have not been formally indicted, the place of trial, if one is held, maintain and regularly conduct a stock or bond brokerage is not known. business and are at all times subject to the authority of the German, Austrian and Danish Government representatives were here, however,seeking information and the International Red Cross has interested governing committee of the Montreal Stock Exchange. itself in the case of the Belgian, whose country has no diplomatic relations They are required to file an application through a member with Russia. The foreigners are: house to the governing committee of the Montreal Stock ir Si!vain Bernhardt, the general manager of the Cantrell Co. for Russia. and on approval will be registered with the Exchange a Belgian subject, whose office is in Moscow. Exchange. •Josef Weinzettl, chief of the company's office in Mariupol, a Black Sea port, who is an Austrian. Authorization was also given to charge member houses of Hari Weinzettl, his brother, company representative at Novorossisk, the Montreal Curb MIrket and the Toronto Stock Exchange Siberia. a special rate of commission. Wilhelm Larsen, representative at Archangel, a Danish subject. Emil Fleischle, a German employed in the Leningrad office. It is not expected that the governing committee will put Herbert Rhoden, a German, who is company manager at Batum. these changes in the by-laws into effect until early in FebAlthough the case parallels in one respect the Metropolitan-Vickers ruary as it will take some time to consider applications. affair, those under arrest were held as individuals, and the company as such was not Involved. The firm, which maintains headquarters in Moscow, An announcement from the Exchange remarked that the continues to operate, and even now is negotiating new contract with the granting of these privileges to non-members houses will be Soviet Government, the old one having expired last summer. especially valuable to towns and cities where there are no New York Stock Exchange Names New Bond Com- branches of member firms and will obviate the necessity of mittee of Five Members—Will Supervise Dealings member firms establishing branch offices. This new policy and Adopt Rules and Regulations with Respect on the part of the Montreal Stock Exchange is expected to Thereto. lend considerable aid to the business of Montreal brokers Announcement was made Jan. 10 by the New York Stock and to increase the volume of transactions on the Montreal Exchange of the formation of a new standing committee Stock Exchange. on bonds, consisting of five members, which will have "general supervision over, dealings, whether upon the Ex- David Lamar Dies of Heart Failure in New York Hotel Room—"Wolf of Wall Street" Made Many Specchange or otherwise, in bonds, notes and other obligations tacular Raids on Stock Market. and in certificates of deposit therefor." The committee David Lamar, often called the "Wolf of Wall Street" bewas formed at the reqUest of brokers who claimed that they had not received sufficient and prompt attention from the cause of a series of unscrupulous raids on the stock market, •Committee on Arrangements of the Exchange which pre- was found dead in a New York hotel loom on Jan. 13, with viously supervised the dealings. The new committee,formed only a small amount of money among his belongings. An by an amendment to the constitution of the Exchange, was autopsy ascribed his death to heart failure. His age was appointed on Jan. 10 by the Governing Committee at a unknown and was variously estimated at between 60 and 75. meeting that day. The members are Louis E. Hatzfeld; We quote in part from the New York "Times" of Jan. 14 Herbert L. Mills; Harry H. Moore; Charles M. Newcombe, regarding his career: Lamar started in New York at a time when the so-called Titans of Wall and Blair S. Williams. The announcement of the formation Street, J. P. Morgan, E. H. Harriman, James J. Hill and others were •of the committee follows: battling for financial supremacy. Lamar wasted little time in minor skirThe constitution of the New York Stock Exchange has been amended to provide for a new standing Committee on Bonds. Section 1 of Article 10 of the constitution has been amended by the insertion of a new paragraph reading as follows: "A Committee on Bonds, to consist of five members. This committee .shall have general supervision over dealings, whether upon the Exchange or otherwise, in bonds, notes and other obligations and in certificates of deposit therefor. It may adopt rules or regulations with respect thereto and shall require the observance thereof when adopted. It shall have .and exercise all the powers and duties of the Committee of Arrangements in so far as the same affect dealings In bonds, notes or other obligations or in certificates of deposit therefor. Election of Officers and Directors of Stock Clearing Corporation and New York Quotation Co. At the annual election of the Stock Clearing Corp., subsidiary of the New York Stock Exchange, held Jan. 10, mishes. For a brief time he was a "minor speculator." He soon became acquainted with Henry Hart, who had been for many years the President of the Third Avenue Railroad Co., and who then possessed $6,000,000. Lamar became Hart's "confidential man"; there followed long litigation over the manipulation of the stock of the Third Avenue RR. and it was discovered that Hart had lost about $5,000,000. Just what became of the money was not made clear. Next Lamar became known as the "gumshoe man" for James R. Keene, broker for financial leaders. Always suave, always resplendent, he trotted around the city on many mysterious errands and made much money in United States Leather common stock. It was not until about 1901 that Lamar began to get the unfavorable publicity which paved the way for his soubriquet—"Wolf of Wall Street." The late E. H. Harriman denounced him then for attempting bullish transactions with the stock of the Southern Pacific. For years Lamar was a bitter enemy of the steel trusts. He was once described as the "only man whom J. P. Morgan feared." Year after year 416 Financial Chronicle he made speculative raids on steel stocks, usually making small fortunes, and year after year mysterious rumors, disquieting stories about the steel companies, would be circulated. In 1910 he almost succeeded in making one of the biggest coups of his lifetime. He got the ear of a prominent but guileless United States Senator from the Middle West and stuffed him full of "facts" damning to the United States Steel Corp. The Senator was prepared to make a fiery speech in the Senate when a Washington newapaper man told him about "Judge" Lamar's past record. In 1913, however, Lamar met the first serious reverse of his career. His tactics in Wall Street and in Washington had become more and more blatant: he scorned his opponents. In June 1913 he was summoned to Washington in the Senate lobby investigation of a mysterious person impersonating a Representative in Congress. During the investigation the "Wolf" boasted that he had often posed as a Representative or other notable to further his schemes. He was indicted and sentenced to Atlanta. After serving a short term he started in to make a new fortune. He was well on the way to success when he again got into trouble, this time for wartime plotting to foment strikes. He was indicted and in May 1917 convicted, with Captain Franz von Rintelen, of the German navy, of impeding shipments of munitions to the Allies. But he succeeded in staying out of prison until October 1923. He got court order after court order staying execution, and when finally the late Chief Justice William Howard Taft remanded him to a New Jersey penitentiary he disappeared. Jan. 20 1934 Copper transactions in 1933 were 101,400 tons as compared with 30,550 tons in 1932 and 17,000 tons in 1931. High and low prices were 9.55 on July 18 and 3.75 on Feb. 27. Hide transactions totaled 307,280,000 pounds,compared with 322,360,000 pounds in 1932 and 626,480,000 pounds in 1931. High and low prices respectively were 15.25 on July 18 and 4.91 on Jan. 30. Tin transactions also declined, the total for 1933 being 1,185 tons as against 2,550 tons in 1932 and 8.815 tons in 1931. The high and low prices respectively were 56.25 on Nov. 15 and 21.15 on Jan. 4 1933. It was also announced that December crude rubber transactions were 58,630 tons, silver 112,025,000 ounces, raw silk 20,340 bales, hides, 19,080,000 pounds, copper 7,225 tons and tin 70 tons. Increase of $5,898,470 in Volume of Outstanding Bankers' Acceptances-Total Dec. 30,$764,110,568. The volume of bankers' acceptances outstanding over the end of the year varied slightly in amount from the total as of Nov. 29. The monthly report of the American Acceptance Council in its survey of acceptance total shows the amount Department of Agriculture Complaint Against Two on Dec. 30 to be $764,110,568, an increase over Nov. 29 Grain Pit Brokers to Be Heard in Cleveland Jan. figures of $5,898,470. According to Robert H. Bean, Execu22. tive Secretary of the Council the year-end total was $54,A complaint against two members of the Chicago Board 381,000 higher than the total for Dec. 31 1932,a large portion of Trade by the Secretary of Agriculture will be heard in of which gain was undoubtedly due to increased commodity Cleveland on Jan. 22, when Adrian Ettinger and Ewing W. prices financed by acceptance credits. Brand, both of Cleveland, will answer a notice directing Mr. Bean in making the figures public Jan. 18 added: them to show cause why an order should not be entered The principal increase in the classified totals was in export credits which against them individually and against the co-partnership advanced $7,572.770. Acceptances based on goods stored in or shipped between foreign countries increased $2,116,947, and dollar exchange credits of Ettinger and Brand, directing that all trading privileges showed a slight unimportant advance. on all contract markets be denied until further notice. An Acceptances arising out of import credits declined $3,280,820, domestic Jan. on Agriculture warehouse credits went off $658,538, and domestic shipments bills declined announcement from the Department of $44,443. 17 added the following details of the complaint: was a considerable shifting in the holding of bills during the month The complaint alleges that respondents, being members of the Chicago Board of Trade, have violated the Grain Futures Act in failing to keep records and in concealing from the Grain Futures Administration the true facts as to certain transactions made on the Chicago Board of Trade in May. June and July 1933. It is alleged further that respondents rendered false reports to the Grain Futures Administration and gave up the names of fictitious persons as being parties to the transactions in question. The accounts of three traders are involved in the charge as false reports, which accounts showed a total open interest in Chicago wheat futures at one time amounting to almost 20,000,000 bushels. The hearing will be conducted by Leo F. Tierney, special attorney for the Department of Agriculture, before referee D.P. Willis. Commodity Exchange (New York) Elects GovernorsNominating Committee Also Named. At a meeting of the membership of Commodity Exchange, Inc., New York, Jan. 16, the following were elected as members of the board of governors to serve for periods of from one to three years: Hide division: Leo Arnstein, Milton R. Katzenberg, Armand Schmoll Jr., Edward L. McKendrew and Fraser M. Moffat. Metal division: Addison B. Hall, Ivan Reitler, Benno Elkan, Irving J. Louis, Martin H. Wehncke. Rubber division: Marcus Rothschild, Robert Badenhop, Charles Slaughter, Charles T. Wilson and William E. Bruyn. Silk division: Charles Muller, Paul A. Salembier, Douglas Walker, Paolino Gel! and Frederic D. Huntington. Commission house division: Harold L. Bache, John L. Julian, Floyd Y. Keeler, J. Chester Cuppia and Jerome Lewine. Non-Trade division: Frank W. Lovatt, Kuo C. Li and I. Henry Hirsch. Officers of the Exchange will be elected at the meeting of the board of governors to be held next week. Jerome Lewine of H. Hentz & Co. has headed the Exchange since its formation last May. Nominating committees to serve during the ensuing year were elected Jan. 16 as follows: Hide: Howard H. Dietrich, Alfred Ely Greene and Joseph C. Kaltenbacher. Metal: Henry Shambroom, E. E. Stewart and B. N. Jackson. Rubber: David D. Haldane, Percy V. L. Bouton and Louis V. Keeler. Silk: Ernest C. Geier, Allan Macfarlan and Charles A. Greeff. Commission house: Allan Bond,Edmondo Gerli and William A. Overton. Non-Trade: Ralph H. Hubbard,Clarence H.Low and Bernard Rhodes. Transactions on Commodity Exchange, Inc.(New York) During 1933-Trading in Silver, Rubber, Silk and Copper Increased Over Preceding Two Years, While Hides and Tin Dropped. Extent of trading on Commodity Exchange, Inc., for the full calendar year 1933 was made known Jan. 2 at the close of the market. Of the six commodities traded in on the Exchange futures transactions in silver amounted to 1,467, 250,000 ounces for the 12 months ended Dec. 30. This figure compares with a total of 315,000,000 traded in during the preceding calendar year and further with a total of 145,500,000 ounces in 1931. High and low prices for silver during the year were 47.55 cents an ounce on Dec. 22 and 24.93 an ounce on Jan. 3 respectively. Transactions in the other commodities are reviewed as follows: Crude rubber transactions were 1,059,760 tons in 1933 against 271,810 12.20 on in 1932 and 219.405 tons in 1931. High and low prices were July 18 and 2.78 on Feb. 28.. and 1932 Raw silk transactions were 404,690 bales, against 265,310 in on July 7 338.390 bales in 1931. High and low prices in 1933 were 2.27 and 1.10 during January and February. There of December and particularly during the last week of the month. At the end of November accepting banks were holding $326,393,711 in purchased bills and of their own bills $272,682,821, a total of $599,076,532. At the end of December these totals had been reduced to $219,182.147 in purchased bills and $223,274,594 in banks'own bills, a total of $442,456,741, a reduction from Nov.29 figures of $156,619,791. Practically all of these bills found their way either into the Federal Reserve banks whose total on Dec.30 was $111,083,000 or into the dealers' Portfolios which amounted to more than $100,000,000 at the end of the year. This decrease in bill holdings by banks at the close of the year is not an unusual operation and it is expected that the banks will again shortly become active buyers, effecting a corresponding decrease in Federal Reserve holdings and portfolios. The following are the detailed statistics furnished by Mr. Bean: TOTAL OF BANKERS' DOLLAR ACCEPTANCES OUTSTANDING FOR ENTIRE COUNTRY BY FEDERAL RESERVE DISTRICTS. Dec. 30 1933, Federal Reserve Distrid. $46,913,275 611,924.545 15,496,418 2,158.890 978,004 8,834.996 40,949,115 2,262,614 3,914,107 1,300,000 3,626,114 25,757,990 1 2 3 4 5 6 7 8 9 10 11 12 Nov. 29 1933. Dec. 31 1932. $47,031,464 608,126,676 15,579,783 2,028,664 709,881 8,742,959 40,882,647 2,260,262 4.283,247 1,350,000 4,102,701 23,113,814 $41,929,260 570,094,674 12,302,553 9,802,986 2,024,563 8,488,948 36,693,104 1,792,822 2,209,408 800,000 1,521,952 22,069,298 $764,110,568 $758.212,098 $709,729,568 Grand total Increase for month, $5,898,470. Increase for year $54,381,000. CLASSIFIED ACCORDING TO NATURE OF CREDIT. Dec. 30 1933. Imports Exports Domestic shipments Domestic warehouse credits Dollar exchange Based on goods stored in or shipped between foreign countries Nov. 29 1933. Dec. 31 1932. $94,268,506 207.226,980 13,833,145 263,006,977 3,967.852 $97,549,326 199.654,210 13,877,588 263,665,515 3.775,298 $78,577,629 163,764,186 14,397,071 215,386,642 9,927,457 181,807,108 179,690,161 227,676,583 CURRENT MARKET QUOTATIONS ON PRIME BANKERS'ACCEPTANCES JAN. 16 1934. Days30 60 90 Dealers' Dealers' Buying Role. Selling Bale. %% 34% %% Si% 34% 34% Days120 150 180 Dealers' Dealers' Buying Rate Selling Role. 'I% 1% 1% %% 34% Securities Market on New York Produce Exchange Fourth Ranking Security Exchange in United States at End of 1933-Held Eighth Place at Close of 1932. The Securities Market on the New York Produce Exchange ended the year 1933 ranking fourth among the security exchanges of the United States, as compared with eighth place at the end of 1932, the Exchange announced on Jan. 3, the announcement adding: This position has been reached in the short space of five years, the market being established Dec. 19 1928, in response to a demand from bankers, brokers, security holders and the public, and at the suggestion of State authorities, who felt that there was a real need for a third security market in New York, the listing requirements of which would be exact and thorough and where transactions would be made public through a ticker service and the press. Volume 138 Financial Chronicle The, Securities Market on the New York Produce Exchange had its second biggest year of trading in 1933, with sales more than double those of 1932, and with only the New York Stock Exchange, the New York Curb Exchange and the Chicago Stock Exchange exceeding its share volume. As of Dec. 31 1933, there were 797 stocks on the list of issues being dealt in, totaling 464,780,062 Elhares, and 153 bonds. The New York Stock Exchange and other important exchanges of the country are well represented In the membership of the Produce Exchange Securities Market. The cottonseed oil futures division of the New York Produce Exchange also showed greatly increased sales for 1933, the total number of contracts dealt in amounting to 9,175, compared with 5,059 in 1932. Value of Commercial Paper Outstanding as Reported by Federal Reserve Bank of New York, $108,700,000 on Dec. 31, Compared with $133,400,000 Nov. 30. The following announcement was issued on Jan. 16 by the New York Federal Reserve Bank showing the commercial paper outstanding on Dec. 31: Reports received by this bank from commercial paper dealers show a total of $108,700,000 of open market commercial paper outstanding on Dec. 31 1933. Below we furnish a record of the figures since they were first reported by the Bank on Oct. 31 931: 1933— Dec. 31 Nov.30 Oct. 31 Sept.30 Aug. 31 July 31 June 30 May 31 Apr. 30 Mar. 31 1933— $108,700,000 Feb. 28 133,400,000 Jan. 31 129,700,000 1932— 122,900,000 Dec. 31 107,400,000 Nov.30 96,900,000 Oct. 31 72,700,000 Sept.30 60,100,000' Aug. 31 64,000,000 July 31 71,900,000 June 30 1932— 84,200,000 May 31 84,600,000 Apr. 30 Mar. 31 81,100,000 Feb. 29 109,600.000 Jan. 31 113,200,000 1931— 110,100,000 108,100,000 Dec. 31 100,400,000 Nov.30 103,300,000 Oct. 31 8111,100,000 107,800,000 105,606,000 102,818,000 107,902,000 117,714,784 173,684,384 210,000,000 Misunderstanding Regarding Bankers' Code Prompts New York State Bankers' Association to Indicate Its Position. In a letter to members of the New York State Bankers' Association W. Gordon Brown, Executive Manager of the Association, seeks to clear a misunderstanding which prevails as to why the effective date of the bankers' code was postponed. Mr. Brown states therein that no attempt was made to "put over" these regulations "on the public or on General Johnson because they were taken up with and approval by an individual who was recognized as his deputy." Mr. Brown's letter follows: NEW YORK STATE BANKERS ASSOCIATION. Headquarters: 33 Liberty Street. New York City To the President of the Institution Addrssed: Dear Sir.—It has been brought to our attention that a misunderstanding prevails among certain members of the Association and their depositors as to the reasons why the effective date of the regulations required by Article VIII of the Bankers' Code of Fair Competition was postponed by the National Recovery Administrator. We wish to make it quite clear that the State Association has not drafted any regulations. It has merely attempted to assist various county associations and clearing houses to comply with what was generally understood to be the law. We sincerely regret any bad feeling which may have been created in the minds of depositors of banks and we hope that this letter will help you to place the matter before them in its true light. Our work with respect to the Code Regulations was, of course, confined to New York State, and was similar to that undertaken by State Associations in other States, as required by Article VIII of the Bankers' Code. All State and local work was and is subject to the authority and supervision of the Banking Code Committee, representing the American Bankers Association and the National Recovery Administration. However, we are not seeking to avoid responsibility for any part of our work in the matter. In order to facilitate its work of co-ordination and approval of the hundreds of sets of local regulations submitted to it from various parts of the country, the aforementioned Banking Code Committee drew up a model set of Code Regulations for use as a standard of measurement. No attempt was mado to "put over" these standard regulations on the public or on General Johnson, because they were taken up with and approved by an individual who was recognized as his deputy. When the Bankers' Code and the regulations thereunder were completed and approved, it was the opinion of the officers of your Association that they were in the interest of sound banking, and they still believe them to be so. They believe that with the elimination of some of the mass of detail included in the regulations, everyone will favor them. The paramount thought at this time among the officers of your Association is that if any portions of the Code or of the regulations are adverse to sound banking or to the public interest, they should be pointed out and modified. The effective date of all regulations under Article VIII of the Code has been indefinitely postponed and a hearing, to be held in Washington on Feb. 15, has been called by General Johnson. Yours very truly, W. GORDON BROWN,Executive Manager. New York State Bankers' Association to Hold Sixth Annual Mid-Winter Meeting in New York Feb. 5— Bankers' NRA Code to Be Discussed. The sixth annual mid-winter meeting of the New York State Bankers' Association will be held in New York City at the Federal Reserve Bank of New York on Feb. 5, it is announced by the headquarters office of the Association. The meeting will bring together representatives of more than 800 banks throughout the State for the consideration of important banking problems. The Association's announcement further said: An important part of the afternoon business session will be devoted to a discussion of the fair trade practice regulations required by the Bankers 417 NRA Code or Fair Competition. This subject is uppermost in the thought of bankers at this time in view of the hearing to be held by General Johnson on these regulations in Washington on Feb. 15. Other subjects to be discussed will be legislation affecting banks proposed both at Albany and Washington. Committees of the association which have been engaged in studying both State and Federal legislative proposals will report to the meeting the position they have taken on the various measures. The bankers will be guests of the officers and directors of the Federal Reserve Bank of New York at a luncheon to be given in the Reserve Dining Room at noon. The meeting will be held in the Reserve Bank auditorium at 2 p. m. and will be followed by a banquet at the Hotel Roosevelt in the evening. J. S. Sinclair Appointed Additional Deputy-Governor of Philadelphia Federal Reserve Bank. The Board of Directors of the Federal Reserve Bank of Philadelphia has appointed John S. Sinclair an additional Deputy Governor, it was announced on Jan. 2 by Richard L. Austin, Chairman. The announcement, as contained in the Philadelphia "Ledger" of Jan. 3, follows: 64,00,..iti r, The Board of Directors of the bank has appointed John S. Sinclair an additional Deputy Governor. He will assume his duties on Jan. 2 1934. Mr. Sinclair, as a member of the firm of Williams, Brittain & Sinclair, counsel of this Bank, has had close contact with the affairs of this Bank for some years and is familiar with its policies and operations. Assistant Federal Reserve Agent of Federal Reserve Bank of Minneapolis—E. W. Swanson Succeeds C. F. Mosher, Resigned. The appointment of E. W. Swanson as Assistant Federal Reserve Agent of the Minneapolis Federal Reserve Bank, succeeding Curtis F. Mosher resigned, was noted in Minneapolis advices to the "Wall Street Journal" of Jan. 9. Mr. Swanson, former Deputy Commissioner of Banks of Minnesota, has been with the Bank since June 15 last. New Dissolution of American Securities Investing Corporation, So Called Bond Pool. The American Securities'Investing Corporation, the socalled bond pool formed in June 1932 by New York banks under the leadership of J.Y. Morgan & Co., has completed repayment to subscribing banks offits outstanding capital debentures. The New York "Times" of Jan. 17 reporting this added: The liquidation began on Dec. 1, when $28,020,000 of the total of $35,025,000 of debentures was called for redemption at 105 and interest. At the close of the year banks holding the remaining $7,005,000 of debentures were invited to tender them, also at 105. The corporation informed the participating banks that it had set up $965,000 reserves for estimated Federal and State taxes and $77,000 of other reserves. If these proved insufficient, it was stated, participants would be considered liable pro rata for the balance. Thomas W. Lamont, a partner in Morgan & Co., was President of the corporation and George Whitney, also a Morgan partner, was chairman of the executive committee. Tenders of $289,397,000 Received to Offering of $125,000,000 or Thereabouts of 91-Day Treasury Bills Dated Jan. 17 1934—$125,340,000 Accepted at Average Rate of 0.67%. Announcement of the results of the offering of 91-day Treasury bills dated Jan. 17 1934, amounting to $125,000,000 Or thereabouts, revealed that of tenders received totaling $289,397,000, $125,340,000 had been accepted. The announcement, made on Jan. 15 by Henry Morgenthau Jr., Secretary of the Treasury, said that the bills sold at an average rate of about 0.67% per annum on a bank discount basis, which compares with previous recent rates of 0.62% (bills dated Jan. 10); 0.62% (bills dated Jan. 3); 0.72% (bills dated Dec. 27), and 0.74% (bills dated Dec. 20). The bids to the offering, referred to in our issue of Jan. 13, page 252, were received at the Federal Reserve Banks, and the branches thereof, up to 2 P. M., Eastern Standard Time, on Jan. 15. The bills mature on April 18,1934 when the face amount will be payable without interest. According to Mr. Morgenthau's announcement the accepted bids ranged in price from 99.862, equivalent to a rate of about 0.55% per annum, to 99.822, equivalent to a rate of about 0.70% per annum, on a bank discount basis. The average price of the issue is 99.831. New Offering of $125,000,000 or Thereabouts of 91-Day Treasury Bills—To Be Dated Jan. 24 1934. A new issue of 91-day Treasury bills was announced on Jan. 17 by Secretary of the Treasury, Henry Morgenthau Jr. The bills offered to the amount of $125,000,000 or thereabouts, will be dated Jan. 24, and will mature on April 25 1934. On the maturity date the face amount will be payable without Interest. Tenders to the offering will be received at the Federal Reserve Banks, or the branches thereof, up to 2 P. M., Eastern Standard Time,on Monday, Jan. 22. No bids will be received at the Treasury Department, Washington. The Financial Chronicle 418 bills will be sold on a discount basis to the highest bidders. A similar issue of bills amounting to $80,034,000 matures on Jan. 24. Secretary Morgenthau's announcement follows in part: They (the bills) will be issued in bearer form only, and in amounts or denominations of $1,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity value). No tender for an amount less than $1,000 will be considered. Each tender must be in multiples of $1,000. The price offered must be expressed on the basis of 100, with not more than three decimal places, e. g., 99.125. Fractions must not be used. Tenders will be accepted without cash deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by a deposit of 10% of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. Immediately after the closing hour for receipt of tenders on Jan. 22 1934, all tenders received at the Federal Reserve Banks or branches thereof up to the closing hour will be opened and public announcement of the acceptable prices will follow as soon as possible thereafter, probably on the following morning. The Secretary of the Treasury expressly reserves the right to reject any or all tenders or parts of tenders, and to allot less than the amount applied for, and his action in any such respect shall be final. Those submitting tenders will be advised of the acceptance or rejection thereof. Payment at the price offered for Treasury bills allotted must be made at the Federal Reserve Banks in cash or other immediately available funds on Jan. 24 1934. The Treasury bills will be exempt, as to principal and interest, and any gain from the sale or other disposition thereof will also be exempt, from all taxation, except estate and inheritance taxes. No loss from the sale or other disposition of the Treasury bills shall be allowed as a deduction, or otherwise recognized, for the purposes of any tax now or hereafter imposed by the United States or any of its possessions. ------ Treasury Purchased $33,868,000 in Government Obligations During Week of Jan. 13. It was announced on Jan. 15 by Henry Morgenthau Jr., Secretary of the Treasury, that Government obligations of $33,868,000 had been purchased by the Treasury during the week ended Jan. 13. Half of this amount was for the account of the Federal Deposit Insurance Corporation, which, it was said, now has a considerable volume of funds available for investment. Since the inception of the Treasury's support to the Government bond market several weeks ago—reference to which was made in our issue of Nov. 25, page 3769—the weekly purchases have been as follows: Nov.25 1933 Dec. 2 1933 Dec. 9 1933 Dec. 16 1933 $8.748.000 2,545.000 7,079.000 16.600,000 Dec. 23 1933 Dec. 30 1933 Jan. 6 1934 Jan 13 1934 $16.510.000 11,950.000 44,713,000 33,868,000 President Roosevelt, in Special Message to Congress, Asks Legislation Authorizing Revaluation of Dollar at 50 to 60 Cents in Terms of Present Statutory Gold Content—Seeks $2,000,000,000 Stabilization Fund, Appropriating the Gold Holdings of the Federal Reserve Banks—Plans Permanent Monetary Policy on Bullion Base—Gold and Exchange Operations to Be Conducted by Treasury Department. President Roosevelt, in a special message to Congress on Jan. 15, described in detail his monetary policy and asked for legislation to make that policy effective over future months. This. legislation, when enacted, will enable the President to nationaliie all American-owned gold, return the dollar to a modified or gold-bullion basis, at a valuation of between 50 and 60 colts of its present par value in gold, and establish a $2,000,000,000 stabilization fund with which the Treasury will seek to control the fluctuations of the dollar in the foreign exchange markets of the world. The Administration's draft of the proposed bill would give the Government authority to take possession of all gold in the country, including the approximately $3,600,000,000 owned by the Federal Reserve System. If and when the dollar is formally revalued, the Government would take over the dollar profit accruing from its possession of these gold stocks. At the White House it was estimated that this profit would be between $3,500,000,000 and $4,125,000,000. The projected $2,000,000,000 stabilization fund, drawn from this amount, would be used not only to steady the dollar on international exchanges, but also to support Government bonds. The proposed fund compares in size with a British equalization fund of approximately $1,800,000,000. This has been operated by Great Britain for about two years. The remaining billion and a half or two billion dollars profit, exclusive of the stabilization fund, will be used by the Government for other recovery purposes. The Administration's bill gives the Treasury and not the Reconstruction Finance Corporation the right to manipulate the stabilizing machinery. The bill instructs the President not to value the new gold dollar at more than 60 cents or less than 50 cents on the basis Ian. 20 1934 of its present gold content, and allows him to change its value within the 10-cent range as often as he considets it necessary to maintain an exact relation to prices. This proposed law would permit the President to take all powers of currency issue from the Federal Reserve banks and vest them exclusively in the Government. The President stressed in his message the desirability of preserving this prerogative. At the White House it was said there were no present plans to take away the note-issuing function of the Federal Reserve banks. Gold, according to the bill, would no longer be used for coinage, and the new gold standard will be a bullion standard. This bullion would not be paid out to individuals. In his message the President specifically remarked that "the transfer of gold in bulk is essential only for the payment of international trade balances." The President mentioned silver in his message in sympathetic terms but did not promise any legislation to promote the use or increase the value of silver. The President had assured himself of sufficient Congressional support of his monetary program at a White House conference on Jan. 14, attended by members of the Banking and Currency Committees of both House and Senate. Following the conference the following statement was issued at the White House on Jan. 14: The President and the Secretary of Treasury conferred to-night with Democrat and Republican members of the Banking and Currency Committees of the Senate and House. The subjects under discussion were the methods of taking into the Treasury the title to and ownership of all monetary gold in the United States and also the general subject of revaluation of the gold content of the dollar. The President expects to send a message to the Congress on these subjects to-morrow, Monday, Jan. 15. According to Washington advices Jan. 14, the following members of the Cabinet and of the Banking and Currency Committees of House and Senate took part in the White House monetary conference: HOUSE. CABINET. Democrats, Henry Morgenthau Jr., Secretary of the Henry T. Rainey, Illinois, Speaker. Treasury. Henry B. Steagall, Alabama, Chairman, Banking Committee. SENATE. T. Alan Goldsborough, Maryland. Democrats. Arming S. Frail, New York. Joseph T. Robinson, majority leader. Duncan U. Fletcher, Florida, Chairman Jeff Busby Mississippi. Michael K. Reilly. Wisconsin, Banking Committee. Frank Hancock, North Carolina. Carter Glass. Clyde Williams, Missouri. Robert F. Wagner, New York. Wesley E. Disney, Oklahoma. Alben W. Barkley, Kentucky. 0. H. Cross. Texas. Robert J. Bulkley, Ohio. Brent Spence, Kentucky. Thomas P. Gore. Oklahoma. Denver S. Church, California. Edward P. Costigan, Colorado. Prentiss M. Brown, Michigan, Robert It. Reynolds, North Carolina. Fred J. Sisson, New York. James F. Byrnes, South Carolina. James I. Farley, Indiana. John H. Bankhead, Alabama. James A. Meeks, Illinois. William G. McAdoo, California. Herman P. Koppletnann, Connecticut. Alva B. Adams, Colorado. James G. Scrugham, Nevada. Republicans, Republicans. Robert Luce, Massachusetts. Peter Norbeck, South Dakota. Cana L. Seedy, Maine. Phillip A. Goldsborough. Maryland. Edward L. Stokes, Pennsylvania. John G. Townsend Jr., Delaware. John B. Hollister, Ohio. Frederic C. Walcott, Connecticut. Jesse P. Wolcott, Michigan. Robert D. Carey, Wyoming. Peter A. Cavicchia, New Jersey. James Couzens, Michigan. James W. Wadsworth, New York. Frederick Steiwer, Oregon. James Simpson Jr.. Illinois. Hamilton F. Kean, New Jersey. The Treasury on Jan. 15 announced that the purchase price for newly mined domestic gold would be raised 39 cents to $34.45, effective Jan. 16. This latter quotation makes the theoretical gold value of the dollar exactly 60 cents. Both the House and Senate on Jan. 15 passed and sent to the President a bill extending the loaning powers of the RFC for one year and increasing its loaning privilege to $850,000,000. President Roosevelt issued three Executive Orders providing more stringent rules to govern exchange transactions, and the Secretary of the Treasury announced that, beginning Jan. 16, all newly mined domestic gold will be purchased by the Federal Reserve Bank of New York, rather than by the RFC,as hitherto. President Roosevelt in his message asserted that "the time has come for a more certain determination of the gold value of the American dollar." He added, however, that "because of world uncertainties, I do not believe it desirable in the public interest that an exact value be now fixed." Referring to the power given him to devaluate the dollar as much as 50%, under the provisions of the Thomas amendment to the Agricultural Adjustment Act, he said that "careful study leads me to believe that any revaluation at more than 60% of the present statutory value would not be in the public interest. I, therefore, recommend to the Congress that it fix the upper limit of permissible revaluation at 60%." The President's reference to the projected $2,000,000,000 stabilization fund was in the following words: That we may be further prepared to bring some greater degree of stability to foreign exchange rates in the interests of our people, there should be added to the present power of the Secretary of the Treasury to buy and sell gold at home and abroad, express power to deal in foreign exchange as such. Volume 138 Financial Chronicle As a part of this power, I suggest that, out of the profits of any devaluation, there should be set up a fund of 52,000,000,000 for such purchases and sales of gold, foreign exchange and Government securities as the regulation ofthe currency, the mantenance of the credit of the Government and the general welfare may require. In outlining the plans for the new bullion gold standard, the President remarked that the free circulation of gold coin is unnecessary, "leads to hoarding, and tends to a possible weakening of national financial structures in times of emergency. The practice of transferring gold from one individual to another, or from the Government to an individual within a nation is not only unnecessary, but is in every way undesirable." He concluded, therefore, that it "is a prudent step to vest in the Government of a nation the title to and possession of all monetary gold within its boundaries, and to keep that gold in the form of bullion rather than in coin." The text of President Roosevelt's monetary message to Congress on Jan. 15 is given elsewhere, as are also the various executive orders, and the text of the draft of the monetary bill. Further details of the monetar 7 message and the projected legislation are given below,as quoted in partfrom a Washington dispatch of Jan. 15 to the New York "Times": In his message, the President also asked for the 52,000,000,000 equalization fund, explaining its function in a managed currency. It was said later by Secretary Morgenthau that the new currency will not evolve a "commodity dollar," but a "managed dollar" within the 10-point range. Congress as a Partner. Congress seemed definitely cheered by the responsibility which the President's message placed upon it, and individual members said the President is making Congress the partner it wants to be in these great affairs. The message was read to the Cabinet last Friday. One Cabinet Minister said to-day that he does not expect devaluation to come until after Congress adjourns so as to keep from that body the temptation to appropriate that part of the reserve dollar profit not needed for the proposed equalization fund. Congressional leaders who have been discussing the message with the President in advance explained its strategy in this way: The President wants a definite monetary expression from Congress to fortify him in his projected, and perhaps already current, effort to reach a stabilization accord with Great Britain. That nation has urged that we stabilize the dollar at considerably more than 60 cents. If Congress fixes 60 cents as the maximum, that is the law and the President's hands will be publicly tied, as he wants them to be. Range of Uncertainty Cut. From the viewpoint of domestic affairs, according to these advisers, the President feels that the value of his move to-day is very great. When enacted into law by Congress, as it will be, he will have reduced the range of uncertainty over the future dollar's value from 50%—the difference between its par gold value and the minimum set in the Thomas amendment —to 10%, the range in which he asks power to operate. This, he feels, offers ample margin for negotiating with Great Britain and should bring out of hiding commercial and financial commitments in the country. hitherto refrained from because of uncertainty as to the values that were to be fixed. When ratified by Congress the monetary policy will, of course, remain theoretical until international agreement and other factors make devaluation a fact. Meanwhile, stabilization at 60 cents or something under will have to be effected by continuing the gold-purchase plan. Only when he has fixed the dollar's value will it be possible to collect the profit on the gold stock to be taken from the Federal Reserve System under the terms of the bill sent to Congress to-day. Only then will the equalization fund of $2,000.000,000 be available. But in the interim the Treasury will operate as the RFC has been operating under the Warren plan, Silver Bloc Is Disappointed. Congress received the message with general enthusiasm, and the stock and commodity markets rose briskly. Abroad the dollar dropped,the pound went up and the franc was strong. The silver bloc in Congress was disappointed because, while the President in his message spoke sympathetically of silver, he offered no plans for its spread as a currency medium. But the bloc is expected to be fairly content with the monetary policy. At the Capitol, parliamentary leaders said that the President is "through with silver" for awhile, and that he will have no real difficulty with the silver bloc. The President told visitors once more of the Attorney-General's opinion that, under the Emergency Banking Act of last March, he has ample power to impound all gold without special Act of Congress. But it is so important a step, and integrates so vitally in a general policy, that he preferred to seek enabling legislation on this and corollary steps. As mentioned above, however, there were politics and strategy as well as legal considerations involved in the decision to send the message and the bill. The President stressed at his press conference his opinion that there is nothing violent about a proposal to devalue the dollar at a 60-cent level because for some time the dollar has been so quoted for domestic purchases, and has remained around 63 cents in terms of foreign exchange. Mr. Roosevelt also laid emphasis on the hope that the program as outlined, despite the fact that a final devaluation level was not fixed, would relieve much of the uncertainty as to the ultimate value of the dollar, and result in business generally showing less hesitancy about entering into long-term contracts. In the message to Congress and through all of the observations at the White House there appeared to be the thought that, while management of the dollar for domestic purposes was in the foreground, the President would be in a much better position to carry on negotiations with foreign Governments for a world agreement on currency adjustments in terms of gold. Up to this time, it was indicated at the White House, definite progress in that direction had not been found possible. Export of Surpluses Aided. The President cited to his press visitors as one important result of the gold purchase policy the depreciation of the dollar in terms of other currency which enabled this country to get rid of a considerable part of its export surpluses. As an example, he feels that cotton has been moving out in large quantities and that a very large part of the surplus of that commodity, which had been overhanging the domestic market, has been 419 eliminated, thus aiding in sending up the price. Another commodity mentioned by the President as having been shipped out in considerable amounts to the benefit of the industry is copper. At the same time it was pointed out that the import trade in certain commodities has increased In the last three months and that the general result accomplished had been excellent from the domestic viewpoint. The President believes that a program of revaluation of the dollar at no more than 60 cents and not less than 50 cents should enable the Government to maintain a fairly reasonable exchange ratio in connection with the currencies of other countries. The President would not indicate when he expected to use the power invested in him to devalue the dollar, putting all questions of this kind aside with a gesture intended to convey that he did not know whether this would be done soon or would for a time await the reactions in other countries. Expects No Bank Opposition. The President is clearly of the opinion that the Government is on sound ground in its move to take over all gold and impound it in the Treasury, and does not expect to meet opposition on the part of the Reserve banks or other banking institutions. In this connection it was explained that the Treasury already has called in all gold held by individuals and corporations and will, when devaluation comes, receive the dollar profit on this gold. Therefore no good reason could be found by the President why any profit on gold held by the banks should accrue to those institutions. He explained that for the gold held by the Reserve System (about 53.600.000,000) the Federal Reserve banks would receive dollar for dollar in gold certificates when the gold was called in and placed under direct Government jurisdiction. These gold certificates under the law are legal reserves for Federal Reserve notes, the same as gold bullion, and the ability of the Reserve banks to issue Federal Reserve notes which have a 40% gold backing would not be impaired. Profit Awaits Devaluation. The President agrees that no profit on gold can be taken until actual devaluation is proclaimed. For the time at least he is represented as believing that use of this profit should be restricted to the operations of the $2,000,000,000 fund which would be set up for purchases of gold, dealings in foreign exchange and, if found necessary, buying Government securities to support the market against bear raids. The President holds that the legislation he has asked of Congress does not compel him to revalue, but would place it within his power to change the gold content of the dollar from time to time anywhere within the range indicated. However, implication was that carrying out the commodity dollar idea was not the paramount purpose of this request for latitude, and that the outstanding purpose was to place the President in a position to combat any steps that foreign governments might take. The President feels that impounding gold in the Treasury is the logical step in approaching the adoption of the bullion gold standard under which gold would be used chiefly in the settlement of international balances, gold coins called in and restrictions placed upon the redemption of currency In gold. The lifting of some of the restrictions on the movement of gold would be essential to the adoption of the new gold standard, which would accompany impounding of the gold and dollar devaluation, it was pointed out at the White House. Shifts of gold as between Central Banks under the bullion plan, the President explained, might call for some export of gold if the trade balance was against the United States, and, oh the other hand, might call for the shipment of gold here when the reverse was the case. To Integrate Present Powers. To set the $2.000,000,000 fund for purchases and sale of gold and exchanges, the President fee's, will be to integrate certain powers that the Government has for a time exercised in a clumsy way through the RFC. Authority to deal in Government securities in the open market was included to give the Treasury a weapon against any interests which might endeavor to weaken the credit position. The President feels that while there has been been no such practice by the great majority of the banks, there have instances where some individuals have advised clients to sell Government not do who people, securities. He does not believe it fair that a handful of like what is going on, should have the ability, without check, to deal in Government bonds and through market manipulation depreciate their price. When the President's bill becomes law, the Treasury and not the RFC new will conduct the remaining stages of the Warren plan and operate the known equalization fund. The RFC Chairman, Jesse H. Jones, made The to-day some of the statistics of its gold-buying activities thus far. Foreign Corporation has bought approximately $120,000.000 in gold. were $22.Purchases were from $90,000,000 to $95,000,000 and domestic purpose. The 898,735. The RFC had been allotted $150,000,000 for the York New and Paris London. in gold that has been purchased is held and will soon be paid into the Treasury. Text of President Roosevelt's Message to Congress Asking Legislation Authorizing Revaluation of Dollar at 50 to 60 Cents—Free Circulation of Gold Coins Held Unnecessary. In another item in this issue we refer to the special message addressed to Congress on Jan. 15 by President Roosevelt asking for legislation authorizing the revaluation of the dollar at 50 to 60c. on the basis of its present gold content. Below is the President's message: To the Congress: In conformity with the progress we are making in restoring a fairer price level and with our purpose of arriving eventually at a less variable purchasing power for the dollar. I ask the Congress for certain additional legislation to improve our financial and monetary system. By making clear that we are establishing permanent metallic reserves in the possession and ownership of the Federal Government, we can organize a currency system which will be both sound and adequate. The issuance and control of the medium of exchange which we call "money" is a high prerogative of government. It has been such for many centuries. Because they were scarce, because they could readily be subdivided and transported, gold and silver have been used either for money or as a basis for forms of money which in themselves had only nominal intrinsic value. In pure theory, of course, a government could issue mere tokens to serve as money—tokens which would be accepted at their face value if it were certain that the amount of these tokens were permanently limited and confined to the total amount necessary for the daily cash needs of the community. Because this assurance could not always or sufficiently be given, governments have found that reserves or bases of gold and silver behind their paper or token currency added stability to their financial systems. 420 There is still much confusion of thought which prevents a world-wide • agreement creating a uniform monetary policy. Many advocate gold as the sole basis of currency; others advocate silver; still others advocate both gold and silver whether as separate bases, or on a basis with a fixed ratio, or on a fused basis. We hope that, despite present world confusion, events are leading to some future form of general agreement. The recent London agreement in regard to silver was a step, though only a step, in this direction. At this time we can usefully take a further step, which we hope will contribute to an ultimate world-wide solution. Certain lessons seem clear. For example, the free circulation of gold coins is unnecessary, leads to hoarding, and tends to a possible weakening of national financial structures in times of emergency. The practice of transferring gold from one individual to another or from the Government to an individual within a nation is not only unnecessary but is in every way undesirable. The transfer of gold in bulk is essential only for the payment of international trade balances.' Therefore, it is a prudent step to vest in the Government of a nation a title to and possession of all monetary gold within its boundaries and to keep that gold in the form of bullion rather than in coin. Because the safe-keeping of this monetary basis rests with the Government, we have already called in the gold which was in the possession of private individuals or corporations. There remains, however, a very large weight In gold bullion and coins which is still in the possession or control of the Federal Reserve banks. Although under existing law there is authority, by Executive act, to take title to the gold in the possession or control of the Reserve banks, this is a step of such importance that I prefer to ask the Congress by specific enactment to vest in the United States Government title to all supplies of American-owned monetary gold, with provision for the payment therefor in gold certificates. These gold certificates will be, as now, secured at all times dollar for dollar by gold in the Treasury—gold for each dollar of such weight and fineness as may be established from time to time. Such legislation places the right, title and ownership to our gold reserves in the Government Itself; it makes clear the Government's ownership of any added dollar value of the country's stock of gold which would result from any decrease of the gold content of the dollar which may be made in the public interest. It would also, of course, with equal justice, cast upon the Government the loss of such dollar value if the public interest in the future should require an increase in the amount of gold designated as a dollar. The title to all gold being in the Government, the total stock will serve as a permanent and fixed metallic reserve, which will change in amount only so far as necessary for the settlement of international balances or may be required by a future agreement among the nations of the world for a redistribution of the world stock of monetary gold. With the establishment of this permanent policy, placing all monetary gold in the ownership of the Government as a bullion base for its currency, the time has come for a more certain determination of the gold value of the American dollar. Because of world uncertainties, I do not believe it desirable in the public interest that an exact value be now fixed. The President Is authorized by present legislation to fix the lower limit of permissible revaluation at 50%. Careful study leads me to believe that any revaluation at more than 60% of the present statutory value would not be in the public interest. I, therefore, recommend to the Congress that it fix the upper limit of permissible revaluation at 60%. That we may be further prepared to bring some greater degree of stability to foreign exchange rates in the interests of our people, there should be added to the present power of the Secretary of the Treasury to buy and sell gold at home and abroad, express power to deal in foreign exchange as such. As a part of this power I suggest that, out of the profits of any devaluation, there should be set up a fund of $2,000,000,000 for such purchases and sales of gold, foreign exchange and Government securities as the regulation of the currency, the maintenance of the credit of the Government, and the general welfare of the United States may require. Certain amendments of existing legislation relating to the purchase and sale of gold and to other monetary matters would add to the convenience of handling current problems in this field. The Secretary of the Treasury is prepared to submit information concerning such changes to the appropriate committees of the Congress. The foregoing recommendations relate chiefly to gold. The other principal precious metal—silver—has also been used from time immemorial as a metallic base for currencies as well as for actual currency itself. It is used as such by probably half the population of the world. It constitutes a very important part of our own monetary structure. It is such a crucial factor in much of the world's international trade that it cannot be neglected. On Dec. 21 1933 I issued a proclamation providing for the coinage of our newly-mined silver and for increasing our reserves of silver bullion, thereby putting us among the first nations to carry out the silver agreement entered Into by 66 governments at the London Conference. This agreement is distinctly a step in the right direction, and we are proceeding to perform our part of it. All of the 66 nations agreed to refrain from melting or debasing their silver coins, to replace paper currency of small denominations with silver coins and to refrain from legislation that would depreciate the value of silver In the world markets. Those nations producing large quantities of silver agreed to take specified amounts from their domestic production and those holding and using large quantities agreed to restrict the amount they would sell during the four years covered by the agreement. If all these undertakings are carried out by the governments concerned, there will be a marked increase in the use and value of silver. Governments can well, as they have in the past, employ silver as a basis for currency, and I look for a greatly increased use. I am, however, withholding any recommendation to the Congress looking to further extension of the monetary use of silver because I believe that we should gain more knowledge of the results of the London agreement and of our other monetary measures. Permit me once more to stress two principles. Our national currency must be maintained as a sound currency which, insofar as possible, will have a fairly constant standard of purchasing power and be adequate for the purposes of daily use and the establishment of credit. The other princple is the inherent right of government to issue currency and to be the sole custodian and owner of the base or reserve of precious metals underlying that currency. With this goes the prerogative of government to determine from time to time the extent and nature of the metallic reserve. I am condifent that the nation will well realize the definite purpose of the Government to maintain the credit of that Government and, at the same time, to provide a sound medium of exchange which will serve the needs of our people. FRANKLIN D. ROOSEVELT. The White House, Jan. 15 1934. Jan. 20 Financial Chronicle 1934 Text of President Roosevelt's Executive Orders Incident to Plans to Revalue Dollar. Incident to his plans to revalue the dollar and to lodge control of all the gold in the country with the Secretary of the Treasury, President Roosevelt on Jan 15 issued three Executive orders; one of these would regulate transactions in foreign exchange, transfers of credit, and the Export of coin and currency; another amends the Executive order of March 10 1933, and the proclamation of Dec. 30 1933, concerning the operation of banks, and the third relates to the receipt of gold on consignment by the mints and assay offices. On Jan. 12 the President, by an Executive Order, amended his Executive Order of Aug. 28 1933, relating to hoarding, export, and earmarking of gold coin, bullion, or currency and to transactions in foreign exchange. The text of the several orders follow: EXECUTIVE ORDER. Amending the Executive Order of March 10 1933, and the Proclamation of Dec. 30 1933, Concerning the Operation of Banks. By virture of the authority vested in me by Section 5 (b) of the Act of Oct. 6 1917 (40 Stat. L.411), as amended by the Act of March 9 1933. and by Section 4 of said Act of March 9 1933, and by virture of all other authority vested in me, I Franklin D. Roosevelt, President of the United States of America, do hereby issue the following executive order: Section 1. The last two paragraphs of the executive order of March 10 1933, concerning the operation of banks, are amended, effective from the date of this order, by striking out the following: nor to engage in any transaction in foreign exchange except such as may be undertaken for legitimate and normal business requirements, for reasonable traveling and other personal requirements, and for the fulfillment of contracts entered into prior to March 6 1933. Every Federal Reserve bank is authorized and instructed to keep itself currently informed as to transactions in foreign exchange entered into or consummated within its district and shall report to the Secretary of the Treasury all transactions in foreign exchange which are prohibited. The Secretary of the Treasury is authorized to amend the licenses heretofore issued with his approval by the Federal Reserve banks, under the executive order of March 10 1933, by issuing through the Federal Reserve banks amendatory licenses removing the restriction upon transactions In foreign exchange contained in the licenses heretofore issued. Sec. 2. The proclamation of Dec. 30 1933, relating to the licensing of banking institutions which are not members of the Federal Reserve System Is amended, effective from the date of this order, by striking out the following: nor to engage in any transaction in foreign exchange except such as may be undertaken for legitimate and normal business requirements, for reasonable traveling and other personal requirements, and for the fulfillment of contracts entered into prior to March 6 1933. See. 3. The amendment of such executive order of March 10 1933, or of any licenses issued thereunder, and the amendment of such proclamation of Dec. 30 1933. shall not affect any act done, or any order, decision, or finding made, or relieve any person from the consequences of any unauthorized act committed prior to the date of this executive order; nor shall the amendment of the executive order of March 10 1933, or the proclamation of Dec. 30 1933, relieve any person from the obligation of complying with the terms of the executive order of Jan. 15 1934, relating to the export of coin and currency and transactions in foreign exchange, or the regulations or licenses issued thereunder, or of any other provisions of law affecting transactions in foreign exchange. FRANKLIN D. ROOSEVELT. The White House, Jan. 15 1934. EXECUTIVE ORDER. Regulating Transactions in Foreign Exchange, Transfers of Credit, and the Export of Coin and Currency. By virtue of the authority vested in me by Section 5 (b) of the Act of Oct.6 1917 (40 Stat. L., 411) as amended by Section 2 of the Act of March 91933, entitled "An Act to provide relief in the existing national emergency In banking and for other purposes," I, Franklin D. Roosevelt, President of the United States of America, do declare that a period of national emergency continues to exist, and by virtue of said authority and of all other authority vested in me, do hereby prescribe the following regulations for the Investigation, regulations, and prohibition of transactions in foreign exchange, transders of credit between or payments by banking institutions as herein defined, and export of currency or silver coin, by any person within the United States or any place subject to the jurisdiction thereof: Section 1. Every transaction in foreign exchange, transfer of credit between any banking institution within the United States and any banking Institution outside of the United States (Including any principal, agent, home office, branch, or correspondent outside of the United States of a banking institution within the United States), and the export or withdrawal from the United States of any currency or silver coin which is legal tender in the United States, by any person within the United Stated, is hereby prohibited, except under license therefor issued pursuant to this executive order: Provided, however, that, except as prohibited under regulations prescribed by the Secretary of the Treasury, foreign exchange transactions and transfers of credit may be carried out without a license for (a) normal commercial or business requirements, (b) reasonable traveling and other personal requirements, or (c) the fulfillment of legally enforceable obligations incurred prior to March 9 1933. Sec.2. Possessioni of the United States. Except as prohibited in regulations prescribed by the Secretary of the Treasury, transfers of credit between banking institutions in the cotinental United States and banking insitutions In other places subject to the jurisdiction of the United States (including principals, agents, home offices, branches, or correspondents in such other Places. of banking institutions within the continental United States), may be carried out without a license. Sec. 3. Licenses. The Secretary of the Treasury, acting directly or through any agencies that he may designate, and the Federal Reserve banks acting in accordance with such rules and regulations as the Secretary of the Tressury may from time to time prescribe, are hereby designated as agencies for the granting of licenses as hereinafter provided. Licenses may be granted authorizing such transactions in foreign exchange, transfers of credit and exports of currency (other than gold certificates) or silver coin in such Psecific cases or classes of cases as the Secretary of the Treasury may determine in regulations prescribed hereunder and rulings made pursuant thereto. Sec. 4. Reports. The Federal Reserve banks shall keep themselves currently informed as to foreign exchange transactions entered Into or con- Volume 138 Financial Chronicle summated, and transfers of credit made between banking institutions outside of the cotinental United States and banking institutions in their districts, and report to the Secretary of the Treasury all transactions in foreign exchange and all such transfers of credit not permitted under Sections 1 or 2 hereof which are effected or attempted in their districts without a license Sec. 5. Regulations. The Secretary of the Treasury is authorized and empowered to prescribe from time to time regulations to carry out the purposes of this order, and to provide in such regulations or by rulings made pursuant thereto, the conditions under which licenses may be granted by the Federal Reserve banks and by such other agencies as the Secretary of the Treasury may designate: and the Secretary of the Treasury may require any person engaged in any transaction, transfer, export, or withdrawal referred to in this executive order to furnish under oath complete information relative thereto, including the production of any books of account. contracts, letters, or other papers, in connection withthere in the custody or control of such person either before or after such transaction, transfer. export, or withdrawal is completed. Sec. 6. Penalties. Whoever willfully violates or knowingly participates in the violation of any provision of this executive order of of any license, order. rule, or regulation issued or prescribed hereunder, shall be subject to the penalties provided in Section 5(b) of the Act of Oct.6 1917, as amended by Section 2 of the Act of March 9 1933. Sec. 7. Definitions. As used in this executive order the term "United States" means the United States and any place subject to the Jurisdiction thereof; the term "continental United States" means the States of the United States, the District of Columbia, and the Territory of Alaska; the term "person" means an individual, partnership, association, or corporation; and the term "banking institution" includes any person engaged primarily or incidentally in the business of banking, of granting or transferring credits, or of purchasing and selling foreign exchange or procuring purchasers and sellers thereof, as principal or agent; and, for the purposes of this order, each home office, branch, principal, agent, or correspondent of any person so engaged shall be regarded as a separate "banking institution." Sec. 8. Section 8 of the executive order of Aug. 28 1933, relating to the hoarding, export, and earmarking of gold coin, bullion, or currency and to transactions in foreign exchange, is hereby revoked. This executive order and any rules, regulations, or licenses prescribed or issued hereunder may be modified or revoked at any time. FRANKLIN D. ROOSEVELT. The White House, Jan. 15 1934. EXECUTIVE ORDER. Relating to Receipt of Gold on Consignment by the Mints and Assay Offices. By virtue of the authority vested in me by Section 5 (b) of the Act of Oct.6 1917, as amended by Section 2 of the Act of March 9 1933, entitled "An Act to Provide Relief in the Existing National Emergency in Banking and for Other Purposes," I, Franklin D. Roosevelt, President of the United States of America, do declare that a period of national emergency exists, and by virtue of said authority and of all other authority vested in me, do hereby prescribe the following regulations for receiving gold on consignment for sale: Section 1. The United States Mints and Assay Offices are hereby authorized,subject to such regulations as may from time to time be prescribed by the Secretary of the Treasury, to receive on consignment gold which the mint or assay office concerned is satisfied has not been held in non-compliance with the executive orders, or the orders of the Secretary of the Treasury, issued under Sections 2 and 3 of the Act of March 9 1933, or in non-compliance with any regulations or rulings made thereunder or licenses issued pursuant thereto. Sec. 2. The Secretary of the Treasury is hereby authorized and empowered to issue such regulations as he may deem necessary to carry out the purposes of this executive order. Sec. 3. This executive order and any regulations issued hereunder may be modified or revoked at any time. • FRANKLIN D. ROOSEVELT. The White House, Jan. 15 1934. EXECUTIVE ORDER Amendment of Executive Order of Aug. 28 1933. Relating to the Hoarding, Earmarking and Export of Gold and to Transactions in Foreign Exchange. The first paragraph of section 4 of Executive Order No. 6260 of Aug. 28 1933, relating to the hoarding, export, and earmarking of gold coin, bullion, or currency, and to transactions in foreign exchange is hereby amended to read as follows: Sec. 4. Acquisition of Gold Coin and Gold Bullion. No person other than a Federal Reserve bank shall after the date of this order acquire in the United States any gold coin, gold bullion, or gold certificates except under license therefor issued pursuant to this Executive order, provided that member banks of the Federal Reserve System may accept delivery of such coin, bullion, and certificates for surrender promptly to a Federal Reserve bank, and provided further that persons requiring gold for use in the industry, profession, or art in which they are regularly engaged may replenish their stocks of gold up to an aggregate amount of $100, by acquisitions of gold bullion held under licenses issued under section 5(b), without necessity of obtaining a license for such acquisitions, and provided further that collectors of rare and unusual coin may acquire from one another and hold without necessity of obtaining a license therefor gold coin having a recognized special value to collectors of rare and unusual coin (but not Including quarter eagles, otherwise known as $2.50 pieces, unless held, together with rare and unusual coin, as part of a collection for historical, scientific or numismatic purposes, containing not more than four quarter eagles of the same date and design and struck by the same Mint). Section 6 of the aforesaid order is hereby amended by adding thereto the following subparagraph: (e) Through any agency that he may designate, the export of gold coin having a recognized special value to collectors of rare and unusual coin (but not including quarter eagles, otherwise known as $2.50 pieces, unless held,together with rare and unusual coin,as part of a collection for historical. scientific, or numismatic purposes, containing not more than four quarter eagles of the same date and design and struck by the same Mint). The White House, FRANKLIN D. ROOSEVELT. Jan. 12, 1934. New Orders of Secretary of the Treasury Amending and Supplementing Order of Dec. 28 1933, Requiring Gold Holdings to be Turned into Treasury— Time Limit for Returning Gold Holdings to Treasury Originally Fixed for Jan. 17 Extended Indefinitely. The Secretary of the Treasury, Henry Morgenthau, Jr., has issued two orders, one dated Jan. 11 and the other Jan. 421 15, amending and supplementing, respectively, the order of the Secretary of the Treasury of Dec. 28 1933, requiring the delivery of gold coin, gold bullion, and gold certificates to the Treasurer of the United States. The order of Dec. 28 was given in our issue of Dec. 30, page 4622. The order of Jan. 15, which fixed Jan. 17 as the final day for the surrender of gold coin, bullion and certificates, was followed by a later order (Jan. 17) which extended the time limit indefinitely. The orders of Jan. 11 and 15 follow: ORDER OF THE SECRETARY OF THE TREASURY. Amending the Order of Dec. 28 1933, Requiring the Delivery of Gold Coin, Gold Bullion, and Gold Certificates to the Treasurer of the United States. Whereas in my judgment the Order of Dec. 28 1933, Requiring the Delivery of Gold Coin, Gold Bullion, and Gold Certificates to the Treasurer of the United States, may be amended as hereinafter provided without adversely affecting the purposes thereof. Now, therefore, I, Henry Morgenthau, Jr., Secretary of the Treasury, do hereby amend said Order of Dec. 28. 1933 by inserting after the word "pieces" in the parenthetical phrase in Paragraph (B) of the first section thereof a comma and the following: "unless held, together with rare and unusual coin, as part of a collection for historical, scientific, or numismatic purposes, containing not more than four quarter eagles of the same date and design, and struck by the same mint." This order may be modified or revoked at any time. H. MORGENTHAU, JR. Secretary of the Treasury. Approved: FRANKLIN D. ROOSEVELT, The White House, Jan. 11 1934. ORDER OF THE SECRETARY OF THE TREASURY. Supplementing the Order of Dec. 28 1933, Requiring the Delivery of Gold Coin, Gold Bullion, and Gold Certificates to the Treasurer of the United States. Whereas on Dec.28 1933, I, Henry Morgenthau, Jr., as Acting Secretary ofthe Treasury,issued an order under authority of Section 11 of the Federal Reserve Act of Dec. 23 1913. as amended by Section 3 of the Act of March 9 1933, entitled "An Act to provide relief in the existing national emergency In banking, and for other purposes"; Whereas said order, as amended by an order of Jan. 11 1934. required every person subject to the jurisdiction of the United States forthwith to pay and deliver to the Treasurer of the United States, all gold coin, gold bullion and gold certificates situated in the United States, owned by such 1143 person, except as follows: (a) Gold bullion owned by a person now holding such gold under a license heretofore granted by or under authority of the Secretary of the Treasury, pursuant to the executive order of Aug. 28 1933. relating to the hoarding, export, and earmarking of gold coin, bullion,or currency and to transactions in foreign exchange; (b) Gold coin having a recognized special value to collectors of rare and unusual coin (but not including quarter eagles, otherwise known as $2.50 pieces,unless held,together with rare and unusualcoin,as part of a collection for historical, scientific or numismatic purposes, containing not more than four quarter eagles ofthesame date and design and struck by thesame mint); (c) Unmelted scrap gold and gold sweepings in an amount not exceeding in the aggregate $100 belonging to any one person; and gold which has been Put through a process of fabrication for a specific and customary industrial, professional, or ornamental use; (d) Gold coin, gold bullion and gold certificates owned by a Federal Reserve bank or the Reconstruction Finance Corporation; and (e) Gold bullion and foreign gold coin now situated in the Philippine Islands, American Samoa, Guam, Hawaii, Panama Canal Zone, Puerto Rico, or the Virgin Islands of the United States, owned by a person not domiciled or doing business in the continental United States: Whereas a reasonable time has elapsed within which any person required to deliver gold coin, gold bullion, and gold certificates could pay and deliver to the Treasurer of the United States in the manner provided in said order of Dec. 28 1933 the gold coin, gold bullion, and gold certificates situated in the United States owned by such person: and Whereas in my judgment such action is necessary to protect the currency system of the United States: Now, therefore, I, Henry Morgenthau, Jr., Secretary of the Treasury. do hereby fix midnight of Wednesday, Jan. 17 1934 as the expiration of the period within which any gold coin, gold bullion, or gold certificates may be paid and delivered to the Treasurer of the United States in compliance with the requirements contained in such order of Dec. 28 1933, as amended. In the event that any gold coin, gold bullion or gold certificates withheld in noncompliance with said order and of this order are offered after Jan. 17 1934 to the Secretary of the Treasury, the Treasurer of the United States, any United States Mint or Assay Office, or to any fiscal agent of the United States, there shall be paid therefore only such part or none of the amount otherwise payable therefor as the Secretary of the Treasury may from time to time prescribe and the whole or any balance shall be retained and applied to the penalty payable for failure to comply with the requirements of such order and of this order. The acceptance of any such coin, bullion, or certificates after Jan. 17 1934, whether or not a part or all of the amount otherwise payable therefor is so retained, shall be without prejudice to the right to collect by suit or otherwise the full penalty provided in Section 11(n) of the Federal Reserve Act, as amended, less such portion of the penalty as may have been retained as hereinbefore provided. The defitions of the terms "person," "United States," "gold coin," and "gold bullion" contained in Section 4 of said order of Dec. 28 1933 apply equally to such terms as used in this order. H. MORGENTHAU, JR. Secretary of the Treasury. Approved: FRANKLIN D. ROOSEVELT, The White House, Jan. 15 1934. With regard to the order extending the deadline for the return of gold holdings, Washington advices, Jan. 17, to the New York "Times" of Jan. 18, said: , Secretary Morgenthau to-night extended the deadline for the surrender of gold coin, bullion and certificates, issuing instructions for the receipt of gold and payment at face value until further notice. A previous order had set midnight to-night as the deadline. 422 Financial Chronicle The Treasurer of the United States, the Mints and Assay Offices and the Reserve Banks were authorized in the new order to receive and pay gold at the statutory rate of $20.67 an ounce. An order approved Jan. 15 had fixed midnight to-night as the deadline. It said that if gold were held beyond that date in non-compliance with the regulations, it would be seized if turned in and applied on a possible maximum penalty of twice the amount of gold held. According to Associated Press advices from Washington Jan. 17 gold hoarding penalties are not lifted by the new order if, in the opinion of the Secretary of the Treasury, the gold paid in has been hoarded. In explanation of the order the Treasury said: "Inquiries have been received by the Treasury Department from business men who desire to know whether they may continue to accept gold coin and certificates in payment for merchandise and services. The instructions which were sent out to-night will provide a way by which they may dispose of receipts of gold coin and gold certificates and receive payment for them." Text of Bill Providing Legislation to Carry Out President Roosevelt's Plan for Revaluation of Dollar— To Be Known as Gold Reserve Act of 1934 -Would Create Stabilization Fund of $2,000,000,000 from Profit Arising from Gold Taken Over by Government. In furtheranace of President Roosevelt's plan to nationalize all American-owned gold, and to revalue the dollar at 50 to 60 cents on the basis of its present gold content,a bill "to protect the currency system of the United States, to provide for the better use of the monetary gold stock of the United States," &c, was introduced in Congress on Jan. 15. The act is to be known as "The Gold Reserve Act of 1934." Under the bill the Secretary of the Treasury would be empowered to issue regulations with the approval of the President, "prescribing conditions under which gold may be acquired and held, transported, melted or treated, imported, exported, or earmarked, &c." The bill stipulates that "all gold coin of the United States shall be withdrawn from circulation, and, together with all other gold owned by the United States, shall be formed into bars of such weights and degrees of fineness as the Secretary of the Treasury may direct." Under an amendment to the Federal Reserve Act contained in the bill the word "gold" would be eliminated and would be replaced in some instances by "lawful money" and in other eases by "certificates." The creation of a stabilization fund of $2,000,000,000 is provided for under the bill; as to this, it is stipulated: ph The fund shall be available for expenditure, under the direction of the Secretary of the Treasury and in his discretion, for any purpose in connection with the carrying out of the provisions of this section, including the investment and reinvestment in direct obligations of the United States of any portions of the fund which the Secretary of the Treasury, with the approval of the President, may from time to time determine are not currently required for stabilizing the exchange value of the dollar. The proceeds of all sales and investments and all earnings and interest accruing under the operations of this section shall be paid into the fund and shall be available for the purposes of the fund. As to the payment of interest on the public debt it is stipulated that "The Secretary of the Treasury may anticipate the payment of interest on the public debt, by a period not exceeding one year, from time to time, either with or without a rebate of interest upon the coupons, as to him may seem expedient; and he may sell gold in any amounts, at home or abroad, in such manner and at such rates and upon such terms and conditions as he may deem most advantageous to the public interest, and the proceeds of any gold so sold shall be covered into the general fund of the Treasury, provided, however, that the Secretary of the Treasury may sell the gold which is required to be maintained as a reserve or as security for currency issued by the United States, only to the extent necessary to maintain such currency at a parity with the gold dollar." The full text of the bill, as given in a Washington dispatch to the New York "Times" follows: A BILL to protect the currency system of the United States, to provide for the better use of the monetary gold stock of the United States, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States ofAmerica,in Congress assembled,that the short title of this act shall be "The Gold Reserve Act of 1934." p Sec. 2(a)—Upon the approval of this act, all right, title and interest and every claim of the Federal Reserve Board of every Federal Reserve bank, and of every Federal Reserve agent, in and to any and all gold coin and gold bullion shall pass to and are hereby vested in the United States; and in payment therefor credits in equivalent amounts in dollars are hereby established in the Treasury in the accounts authorized under the 16th paragraph of Sec. 16 of the Federal Reserve Act, as heretofore and by this act amended (U. S. C., Tit. 12, Sec. 467). Balances in such accounts shall be payable in gold certificates, which shall be in such form and in such denominations as the Secretary of the Treasury may determine. All gold so transferred not in the possession of the United States shall be held in custody for the United States and delivered upon the order of the Secretary of the Treasury; and the Federal Reserve Board, the Federal Reserve banks and the Federal Reserve agents shall give such instructions and shall take such action as may be necessary to assure that such gold shall be so held and delivered. Word "Gold" Struck Out of Federal Reserve Act. (b) Sec. 16 of the Federal Reserve Act, as amended, is further amended: By striking out the word "gold" where it first appears in the last sentence of the first paragraph (U.S.C.,Tit. 12,Sec.411)ofsaid Sec. 16 and inserting in lieu thereof the words "lawful money:" and by striking out the phrase "in gold or lawful money" where it appears in said sentence; by striking out Jan. 20 1934 the word "gold" and the ensuing comma,and the words "gold or" wherever in Sec. 16 they are immediately followed by the words "gold certificates:" by striking out the word "gold" in the first sentence of the third paragraph (U. S. C., Titl. 12, Sec. 413) of said Sec. 16 where it follows the words "shall be counted as part of the" by inserting after the word "gold," the word "certificates" wherever it now appears in said Sec. 16, not immediately followed by the word "certificates," except in the 16th paragraph (U. S.0., Tit. 12, Sec. 467) of said Sec. 16 and except where the same is stricken out by this section; by striking out the word "coin" where it appears after the phrase "deposits of gold" in the first sentence of the 16th paragraph; by striking out the words "gold coin or" where they appear after the words "shall be payable in" in the third sentence of the 16th paragraph, and by striking out all the third sentence of the 16th paragraph after the words "such Federal Reserve agent" and inserting in lieu thereof a period; and by striking out the words "gold deposits" in the 18th paragraph and inserting lieu thereof the words "deposits made under this section." Treasury to Regulate Holding and Use of Gold. Sec. 3—The Secretary of the Treasury shall, by regulations Issued hereunder, with the approval of the President, prescribe the conditions under which gold may be acquired and held, transported, melted or treated. Imported, exported or earmarked; (a) for Industrial, Professional and artistic use; (b) by the Federal Reserve banks for the purpose of settling international balances; and (c) for such other purposes as in his judgment are not inconsistent with the purposes of this act. Gold in any form may be acquired, transported, melted or treated, imported, exported or earmarked or held in custody for foreign or domestic account (except on behalf of the United States), only to the extent permitted by. and subject to the conditions prescribed in, or pursuant to, such regulations. Such regulations may exempt from the provisions of this section. in whole or in part, gold situated in the Philippine Islands or other places beyond the limits of the continental United states. Sec. 4.—Any gold withheld, acquired, transported, melted or treated, imported, exported, or earmarked or held in custody, in violation of this act or of any regulations issued hereunder,or licenses issued pursuant thereto, shall be forfeited to the United States, and may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure and condemnation of property imported into the United States contrary to law;and in addition any person failing to comply with the provisions of this act or of any such regulations or licenses, shall be subject toa penalty equal to twice the value of the gold in respect of which such failure occurred. Sec. .—No gold shall hereafter be coined and no gold coin shall hereafter be paid out or delivered by the United States, provided, however, that coinage may continue to be executed by the mints of the United States for foreign countries in accordance with the Act of Jan. 29, 1874 (U. S. C. Tit. 31, Sec. 367). All gold coin of the United States shall be withdrawn from circulation and, together with all other gold owned by the United States, shall be formed into bars of such weights and degrees of fineness as the Secretary of the Treasury may direct. Will Maintain Reserve for Present Gold Notes, Sec. 6.—Except to the extent permitted in regulations which may be issued hereunder by the Secretary of the Treasury with the approval of the President, no currency of the United States shall be redeemed in gold: provided, however, that gold certificates owned by the Federal Reserve Banks shall be redeemed at such times and in such amounts as, in the judgment of the Secretary of the Treasury, are necessary to maintain the equal purchasing power of every kind of currency of the Untted States; and, provided, further, that the reserve for United States notes and for Treasury notes of 1890, and the security for gold certificates (including the gold certificates held in the Treasury for credits payable therein) shall be maintained in gold bullion equal to the dollar amounts required thy law and the reserve for Federal Reserve notes shall be maintained in gold certificates, or in credits payable in gold certificates maintained with the Treasurer of the United States under Section 16 of the Federal Reserve Act as heretofore and by this act amended. No redemptions in gold shall be made except in gold bullion bearing the stamp of a United States mint or assay office in an amount equivalent at the time of redemption to the currency surrendered for such purposes. Sec. 7.—In the event that the weight of the gold dollar shall at any time be reduced, the resulting increase in value of the gold held by the United States (including the gold held as security for gold certificates and as a reserve for any United States notes and for Treasury notes of 1890) shall be covered into the Treasury as a miscellaneous receipt; and, in the event that the weight of the gold dollar shall at any time be increased, the resuiting decrease In value of the gold held as a reserve for any United States notes and for Treasury notes of 1890 and as security for gold certificates shall be compensated by transfers of gold bullion from the general fund and there is hereby appropriated an amount sufficient to provide for such transfers and to cover the decrease in value of the gold in the general fund. Can Purchase Gold to Increase Assets. Sec. 8.—Sec. 3700 of the Revised Statues (U. S. O., Tit. 31, Sec. 734) is amended to read as follows: "With the approval of the President, the Secretary of the Treasury may purchase gold in any amounts, at home or abroad, with any direct obligations, coin or currency of the United States, authorized by law, or with any funds in the Treasury not otherwise appopriated, at such rates and upon such terms and conditions as he may deem most advantageous to the public interest; any provision by law relating to the maintenance of parity, or limiting the purposes for which any such obligations, coin or currency may be issued, or requiring any such obligations to be offered as a popular loan or on a competitive basis or to be offered or issued at not less than par to the contrary notwithstanding. All, gold so purchased shall be included as an asset of the general fund of the Treasury." Sec. 9—Section 3699 of the Revised Statutes(U. S. C., Tit. 31, Sec. 733) Is amended to road as follows: "The Secretary of the Treasury may anticipate the payment of interest on the public debt, by a period not exceeding one year, from time to time, either with or without a rebate of interest upon the coupons, as to him may seem expedient; and he may sell gold in any amounts, at home or abroad, in such manner and at such rates and upon such terms and conditions as he may deem most advantageous to the public interest, and the proceeds of any gold so sold shall be covered into the general fund of the Treasury, provided, however, that the Secretary of the Treasury may sell the gold which is required to be maintained as a reserve or as security for currency issued by the United States only to the extent necessary to maintain such currency at a parity with the gold dollar." Sec. 10 (a).—For the purpose of stabilizing the exchange value of the dollar, the Secretary of the Treasury is authorized, directly or through any agency or agencies that he may designate, to purchase, sell, discount or negotiate, or to contract to purchase, sell, discount or negotiate, at home or abroad, with or without endorsement or guarantee, drafts, checks, bills of exchange, acceptances, including bankers' acceptances, coin, bullion, cable transfers, foreign exchange, bonds, notes. evidences of indebtedness, including the obligations of the United States or of any foreign government, Volume 138 and any obligations or securities in whatever currency payable, to establish credits therefor and generally to exercise such powers as are incidental to the powers conferred by this section. Stabilization Fund of $2,000,000,000 Created. (b).—To enable the Secretary of the Treasury to carry out the provisions of this section there is hereby appropriated out of the receipts which are directed to be covered into the Treasury under Section 7 hereof the sum of $2,000,000,000, which sum when available shall be deposited with the Treasurer of the United States in a "stabilization fund"(hereinafter called the "Fund"), under the exclusive control of the Secretary of the Treasury, whose decisions shall be final and not be subject to review by any other officer of the United States. The Fund shall be available for expenditure, under the direction of the Secretary of the Treasury and in his discretion, for any purpose in connection with carrying out the provisions of this section, including the investment and reinvestment in direct obligations of the United States of any portions of the Fund which the Secretary of the Treasury, with the approval of the President, may from time to time determine are not currently required for stabilizing the exchange value of the dollar. The proceeds of all sales and investments and all earnings and interest accruing under the operations of this section shall be paid into the Fund and shall be available for the purposes of the Fund. (c) At such times as the President may determine, the President shall cause an audit to be made of the fund and a full report thereof shall be included in the next succeeding annual report of the Secretary of the Treasury. Sec. 11.—The Secretary of the Treasury is hereby authorized to issue, with the approval of the President, such rules and regulations as the Secretary may deem necessary or proper to carry out the purposes of this Act. Weight of Gold Dollar. Sec. 12.—Paragraph B (2) of Section 43, Title III of the Act approved May 12 1933 (Public No. 10, Seventy-third Congress), is amended by adding two hew sentences at the end thereof, reading as follows: "Nor shall the weight of the gold dollar be fixed in any event at more than 60 per centum of its present weight. The powers of the President specified in this paragraph shall be deemed to be separate and distinct powers and may be exercised by him, from time to time, severally or together, whenever and as the expressed objects of this section in his judgment may require." Previous Orders of the President Ratified. Sec. 13.—All actions, regulations, rules, orders and proclamations heretofore taken, promulgated, made or issued by the President of the United States or the Secretary of the Treasury, under the Act of March 9 1933, or under Section 43 or Section 45 of Title III of the Act of May 12 1933, are hereby approved, ratified and confirmed. Sec. 14.—Definitions.—As used in this act the term "United States" means the Government of the United States; the term "the Continental United States" means the State of the United States, the District of Columbia and the Territory of Alaska: the term "currency of the United States" means currency which is legal tender in the United States and includes United States notes, Treasury notes of 1890, gold certificates, silver certificates, Federal Reserve notes and circulating notes of Federal Reserve Banks and National Banking Associations, and the term "person" means any individual, partnership, association or corporation, including the Federal Reserve Board, Federal Reserve Banks and Federal Reserve Agents. Wherever reference is made in this act to equivalent of dollars, currency of the United States and gold, one or one dollar face amount of any currency of the United States equals such a number of grains of gold, 9-10ths fine, as, at the time referred to. are contained in the standard unit of value, that is, so long as the President shall not have altered by proclamation the the weight of the gold dollar under the authority of Sec. 43, Title III of the acqapproved May 121933,as heretofore and by this act amended,25 8-10ths grains of gold, 9-10t1u3 fine, and thereafter such a number of grains of gold, 9-10ths fine, as the President shall have fixed under such authority. Sec. 15.—The right to alter, amend or repeal this act is hereby expressly reserved. If any provision of this act, or the application thereof to any person or circumstances, is held invalid, the remainder of the act and the application of such provision to other persons or circumstances, shall not belaffected thereby. Sec. 16.—All acts and parts of acts inconsistent with any of the provisions of this act are hereby repealed, Sec. 17.—To contain miscellaneous minor provisions which the Secretary of the Treasury will submit. Governor Black of Federal Reserve Board Before Senate Banking and Currency Committee Presents Views on Administration's Monetary Bill to Devalue Dollar—Details Attitude of Board Toward Right of Treasury to Claim Profits on Reserve System's Gold and Transfer of Title of Gold to Treasury—Gold Holdings of Treasury and Reserve Banks Total $4,012,910,000. In Washington on Jan. 18, Eugene R. Black, Governor of the Federal Reserve Board, was accorded a hearing as to the views of the Board on the Administration's Monetary Bill to carry out President Roosevelt's proposal to devalue the dollar and to lodge with the Treasury the gold holdings of the Federal Reserve System. At the hearing Governor Black enlarged upon his statement, issued Jan. 16 (and given elsewhere in these columns to-day) in which, in indicating 'the Board's views, he conceded the right of the Government to take over the profits on gold arising from the monetary policy of the Administration; at the same time Governor Black maintained that the transfer to the Government of the title to the system's gold was a question for determination by Congressional legislation. Indicating that Governor Black at the Senate Committee hearing on Jan. 18 frankly told the Committee that the Federal Reserve Board has been unalterably opposed to the seizure of the gold stocks of the Reserve Banks without specific legislation directing such a course. The Washington account Jan. 18, to the New York "Times" continued: Intimates Board's Opposition. The Board took this position. Governor Black said, on the original proposals to impound the gold by Executive Decree. Ile sought to maintain a 423 Financial Chronicle neutral attitude on the pending bill, which proposes legislation along the line then demanded by the Reserve Board, but in answer to questions he intimated strongly the Board's opposition to giving up the gold even at the direction of Congress. . . . Black Insists Upon a Law. Governor Black in his statement to the Committee stressed the view of the Reserve Board,that capture of the system's gold should be undertaken only by an Act of Congress. He did not question the right of Congress to do so, although he did express the desire of the Reserve System to hold its gold as a reserve against its currency issues. He emphasized, too, that the Board had never held that the system was entitled to any profits on the gold holdings which might accrue as a result of the President's plan. He felt, he said, that these profits arose from a "purely monetary policy of the Government," and that they could go to the Government independently of the question of where the title to the system's holdings might be vested. Governor Black insisted, however, and he placed his Board on record as having the same view, that the seizure of any part of the gold should be accomplished only by special Act of Congress, and that none of the emergency acts was considered broad enough to warrant the Executive branch in making such a seizure. A conference on Dec. 14, when the subject first was mentioned was described. The opinion was expressed then by Government officials, Governor Black recalled, that the Government had a right under one of the amendments of the Federal Reserve Act of last year to take over the system's gold. Objected "Seriously" to Plan. objected seriously to the plan and asked time for its consideration," he said. "This time was granted and I thereupon presented in writing my objections to the plan and to its purpose." The Reserve Board had considered two plans, one for the simple requisition by the Treasury of the gold and the other for the voluntary exchange of the gold for gold certificates, as is now proposed. The outcome of this study, he said, was the determination of the Board to hold its gold until demand was made for it, and then to surrender it under protest. This decision was transmitted to the twelve Reserve Banks for consideration by their directors. "While the directors of the Reserve Banks were considering these matters, I called upon the President and presented the reasons against the two plans suggested and urged the necessity of Congressional action in determination of these questions," Mr. Black continued. "The President agreed with me, and on Dec. 29 the matter was withdrawn from consideration of the Board and the Reserve Banks and, as I understand it, has now been presented to Congress for its determination." Total Stocks $4,012,910,000. An inventory of the gold held by the Federal Reserve System and the Treasury, amounting to $4,012,910,000, was presented, as well as a notation on the places where parts of the stocks are held. Mr. Black, when questioned by Committee members, sought earnestly to avoid a commitment as to the particular bill, inSisting that his demands had been fulfilled, namely, that seizure of the system's gold should be only by Congressional action. Senators gained the impression, however, that Mr. Black and the Board would be very reluctant to part with the title even under Congressional mandate. Mr. Miller substantiated Mr. Black's statement in his brief testimony. Like Mr. Black, he sought to avoid any suggestion of amendments or final disposition of the pending bill. Governor Black's statement before the Committee follows: I would like to make perfectly clear to the Committee the position of the Federal Reserve Board upon some of the different matters presented in this bill. In order to do this it will be necessary to inform the Committee of events leading to consideration of these matters by the Board and the Reserve Banks and the action by the Board upon them. There are three primary matters involved: 1. Devaluation of the dollar by changing its gold content. 2. The allocation of the so-called profit ix. event of devaluation upon the gold holdings of the Reserve System. 3. The transfer of the title to the gold of the System from the Reserve banks to the Treasury. The Board has recognized that the Congress has expressed itself on the Governmental policy as to devaluation in the Thomas Amendment and the Board has given consideration to the policy only in connection with its effect in producing the other two questions involved, to wit: so-called profits upon and title to the system's gold holdings. These two questions have been considered with Governmental officials. I have always maintained that these two questions were not interdependent and that the solution of one of them was not of necessity involved in the solution of the other. Profits on Gold Belong to Government. On the question of the so-called profits upon our gold I have felt that these profits arose from a purely monetary policy of the Government and arising from such purely monetary policy should and could go to the Government independently of and irrespective of the question of where the title to the Reserve System's gold was vested. This conviction has been held irrespective of my knowledge that this gold has been bought by the system under authority of law to buy and sell gold, and under the usual practice of Reserve Banks authorized by provisions of the Federal Reserve Act, and under the usual practice and procedure of the Central Banks of every country. The fact remains that this enhanced value of the system's gold has resulted from no work or investment or act or effort on the part of the system, but solely from a Governmental policy, and having so resulted the profit, or enhanced value, as I prefer to call it, should enure to the Government. This position was made plain in my conferences with the Government officials. My. conclusion as to the allocation of this enhanced value of our gold involved in no way the necessity of a change in the title to that gold. The profits could be allocated to the Government by a simple amendment to the Thomas Amendment providing that in the event of devaluation such profit should go to the Government through one of the legal expedients necessary to that end. I have urged that this method be followed in the matter of such profits. Under such method the profits could be paid over by the Reserve Banks to the Government in any form meeting the Government's requirements. This would leave the gold in the Reserve Banks where it could continue as the base of the system's currency and credit operations, to be held even under such restrictions as are now placed upon gold by the Government. 424 Jan. 20 1934 Financial Chronicle A tabulation attached to the statement of Governor Black showed that the gold in the Treasury and in Federal Reserve Banks totals $4,012,918,000 and of this sum $3,201,941,000 is Question of Government's Taking Title to Gold of Reserve Banks. held in the different agencies of the Treasury. As given in with Government conference December 1933, at a On the 14th day of the "Times" the tabulation follows: officials there arose for the first time the question of the Government's tak- Gold holdings of Treasury and Reserve Banks total $4,lug title to the gold of the Reserve Banks. The opinion was expressed that the Government had this right under Section 11, paragraph (n) of the 012,918,000. At the same time the Government would have received all enhanced value upon that gold as the result of devaluation. This is the process followed in France upon the devaluation of the franc. Federal Reserve Act, with which law you gentlemen are familiar, and based on this opinion a plan was proposed for taking title to the gold under this law. I objected seriously to the plan and asked time for its consideration. This time was granted and I thereupon presented in writing my objections to the plan and to its purpose. A suggestion was then made that the Reserve Banks could voluntarily exchange their gold for gold certificates of the character described in this bill. A conference of the Governors of the Reserve Banks was held and the two plans, namely, the one requisitioning the gold under Section 11, Paragraph N, of the Federal Reserve Act, or the voluntary exchange of the gold for gold certificates were considered. The Governors asked for an expression of the Board's views in the matter and these views were expressed as follows: In event, first, the President should write the Board with respect to the plan embracing action under the Thomas Amendment and the placing of title of the gold holdings of the Federal Reserve System in the Treasury so that profits on that gold would accrue to the Government, if, as and when devaluation is effected; and, second, if the Secretary of the Treasury should requisition the gold holdings of the Federal Reserve System under Section 11 (n) of the Federal Reserve Act and should offer gold certificates In payment of such gold holdings, then the Federal Reserve Board feels: 1. That it should express its strong conviction that appropriate legislation by Congress should be had covering this question of profits upon the gold holdings of the Federal Reserve System, although it is of opinion that this profit, being the result of the monetary policy of the Government, should ultimately go to the Government. 2. That neither the Federal Reserve Banks nor the Federal Reserve agents can enter into voluntary agreement covering the transfer of the title in this gold to Government because of their responsibility as officers and directors of the Reserve Bank and of their trusteeship in connection with their duties as such, and 3. That if demand is made by the Secretary of the Treasury under Section 11 (n) of the Federal Reserve Act for the gold holdings of the Federal Reserve System, then the Federal Reserve Banks and the Federal Reserve agents should yield possession of the gold to the Treasury or its representatives and receive any gold certificates tendered to them, but only under protest, fully preserving all legal rights. The conference with Government officials decided at my request that these two plans should be considered by the directors of the twelve Reserve Banks. The Governors returned to their banks and called meetings of their respective directors. . I had urged all along that this question of the title to the Reserve system's gold was of such large import and of so great consequence to the Nation that it should be solved by Congress and that Congress should determine where the title to this gold should vest, whether in the Reserve Banks or in the Treasury. This position was taken because: 1. We were advised by counsel that Section 11, Paragraph (n) of the Reserve Act was not applicable under its terms to the Reserve Banks and that under that law the Secretary was not authorized to requisition our gold, and that there was no other law so empowering him. 2. That the officers and directors of the Reserve Banks, as trustees, should not exchange their gold for the certificates described in this bill, because as such trustees they had no right to so change the character of the assets entrusted to them. 3. That Congress only could have the right under the law to determine this question. 4. That we felt the gold should remain with the Central banks of the Nation for manifest purposes of currency and credit needs. While the directors of the Reserve Banks were considering these matters, I called upon the President and presented the reasons against the two plans suggested and urged the necessity of Congressional action in determination of these questions. The President agreed with me, and on• Dec. 29 the matter was withdrawn from consideration of the Board and the Reserve Banks, and, as I understood it, has now been presented to Congress for its determination. In reference to this gold I will simply state that at present it is pledged under the law as security for $3,238,810,000 of Federal Reserve notes issued by the twelve banks, and constitutes the reserves required by law upon notes issued by the Reserve Banks and upon deposits made with Reserve Banks. It may be of value to the Committee to have before it a statement of the gold in the Treasury and in the Reserve Banks. The following two pages [of circular] give this information as of recent date. The gold coin and the gold bullion held by the Reserve Banks speak for themselves. The gold certificates held by the Reserve Banks were issued by the Treasury under authority in the United States code, Title 31, Section 429, the first paragraph of which is as follows: "The Secretary of the Treasury is hereby authorized and directed to receive deposit of gold coin with the Treasury, or any Assistant Treasurer of the United States, In sums of not less than $20 and to Issue gold certificates therefor in denominations of not less than $10, and the amount so deposited shall be retained In the Treasury and held for the payment of such certificates on demand and used for no other purpose." Reserve Bank's Gold. The Reserve Bank's gold in the Federal Reserve agents' gold fund deposited with the Treasury amounts to $1,105,174,000 and is provided for in Section 16 of the Reserve Act. This gold is part of the collateral held by the Federal Reserve agent for Federal Reserve Notes and deposited as authorized by law in the custody of the Treasury. The gold of the Reserve Banks in the gold redemption fund in the Treasury amounts to $40,888,000, and is provided for in Section 16 of the Reserve Act and is gold deposited by the Reserve Banks with the Treasury for the purpose of redeeming in gold Federal Reserve notes. The gold of the Reserve Banks in the gold settlement fund in the custody of the Treasury amounts to $673,403,000 and is authorized by the same section of the Reserve Act, and is gold placed by the Reserve Banks with the Treasury for clearing purposes between the Reserve Banks. The Board is of the opinion that both the allocation of the profits upon the system's gold and the question of title to its gold are properly matters for the determination of Congress. San Francisco Mint $1,308,000 $1,439,799,000 New Orleans Assay OftIce. New York Assay Office— 879,610,000 Cashier's Office, Washing10,933,000 Philadelphia Mint 503,075,000 ton Denver Mint 365,022,000 $3,201,941,000 Seattle Assay Office 2,194,000 Total Gold in Reserve Banks. The remaining $810,977,000 of gold coin and bullion is located in the Federal Reserve Banks as follows: 612,476,000 New York 1406.430,003 St. Louis 11,848,000. Chicago ...., 134,707,000 Minneapolis 11,289,000 San Francisco 92,905,000 Kansas City 9,172,000 Boston 47,616,000 Atlanta 11,805,000 Richmond 29,443,000 Dallas Cleveland 22,738,000 $810,977,000 Philadelphia 23,548,000 Total Certificates Held by Banks. In addition to gold coin and bullion the Federal Reserve Banks hold gold certificates as follows: $16,180,000 $264,797,000 St. Louis New York 314,059.000 Dallas 12,478,000 Chicago 18,462,000 29,160,000 Minneapolis San Francisco 18,087,000 48,644,000 Kansas City Boston 15,010,000 23,717.000 Atlanta Richmond 89,332,000 Cleveland 92,870,000 Total ' $942,796,000 Philadelphia Gold Held in Treasury. Gold of the Federal Reserve Banks is held in the Treasury as follows: $942,794,000 Collateral for gold certificates held by Federal Reserve banks Federal Reserve Agents'gold fund (collateral for Fed. Reserve notes). 1,105,174,000 073,403,000 Gold settlement fund 40,888,000 Gold redemption fund $2,762,259,000 Total 3.572,236.000 Total gold reserves of the 12 Federal Reserve banks 439,682,000 Gold in the Treasury other than Federal Reserve gold Of this $219,39100 is collateral for gold certificates in circulation outside of Federal Reserve Banks and $156,039,000 is reserves against United States notes, $30,329,000 against redemption funds for National bank notes and Federal Reserve Bank notes, and $33,923,000 free gold. Gold certificates in circulation outside of Federal Reserve Banks totals $217,391,000 and gold in circulation outside of Federal Reserve and Treasury 8311,045,000. Secretary of Treasury Morgenthau Sees Managed Currency—"Commodity Dollar Idea" Not Linked with President Roopevelt's Program He Declares— Federal Reserve Banks to Act—Profit on 60-cent Basis Put at $2,666,666,666. Secretary Morgenthau said on Jan. 15 that the aim of the Administration's new monetary plans was for a managed currency and that the "commodity dollar idea" was not in any way attached to the steps contemplated under the program. A dispatch from Washington to the New York "Times" went on to say that the authority requested by the President to vary the gold content of the dollar with a 10point range might have some effect upon commodity prices suggested, but Mr. Morgenthau replied: "My answer is that this is not a commodity dollar." Continuing the dispatch stated: Asked if any part of the profit on gold in the event of devaluation would be used in connection with the large financing to be carried on by the Government in the next few months, Mr. Morgenthau stated that the Treasury would borrow whatever was necessary and that there was no thought of using profits from gold devaluation for such purposes. Secretary Morgenthau refused to offer any opinion as to whether the present step was the preliminary to an effort toward world-wide stabilization of currencies. Ile said, however, that the immediate objective of the proposal was to "take care of our own problem." "Roosevelt Dollar" Is Nickname, The Secretary also held that it would be "possible" to reach an international monetary agreement even with a program which would permit the dollar to fluctuate between the 50 and 60 cent level. In the opinion of the Treasury a satisfactory agreement could be effected if only Great Britain and France joined in such a compact. Mr. Morgenthau said that proposed variations in the dollar's gold content as now suggested were not tied up to any commodity index such as that prepared by the Department of Labor. The inference was that the leeway which the President desired was to give him a weapon in dealing with other nations when general devaluation was in prospect. In some official circles the label "Roosevelt dollar" was being used in describing the new status of the Currency. No new monetary board is contemplated under the program, Secretary Morgenthau said. The Federal Reserve System will remain as the financial agent for the Treasury and Mr. Morgenthau took the occasion to say that the Federal Reserve had done a splendid job in exchange operations. The Treasury estimates that the dollar profit on gold if tho 60-cent dollar was adopted, would be $2,666.666,666 on the approximate $4,000,000,000 of gold which is now in the hands of the Treasury or Federal Reserve banks. It was indicated that no decision had been reached as to the use of the amount over the $2,000.000,000 "equalization fund." In taking over gold from the Federal Reserve banks, Mr. Morgenthau said that gold certificates would be given, but the metal would not be allowed to circulate and would be held as backing for Federal Reserve notes. Purchases of gold and other operations by the Reconstruction Finance Corporation under the gold purchase plan would be ended quickly with the adoption of the new policy. Mr. Morgenthau announced to-day that, beginning to-morrow, the Federal Reserve Bank of New York would act as fiscal agent of the Treasury in buying newly mined domestic gold. The Treasury will take this over by purchasing from the Bank equivalent amounts of gold coin, having the Volume 138 Financial Chionicle authority under existing law to make such purchases at rates which the Secretary may prescribe. Chairman Jones of the RFC said to-day that purchases of domestic gold by his Corporation have aggregated $22,989,735, and these, combined with operations abroad, brought the outlay by the RFC to just under $120,000,000. Total authorizations of RFC debentures which it has exchanged for such gold, it was revealed, had been raised to $150,000,000. RFC to Continue a While. No definite order was issued to-day as to what agency shall make further gold purchases abroad pending setting up of the stabilization fund, but it was indicated that the RFC probably would continue to carry on such operations until some new arrangement was made. It is the ultimate purpose, however,to have the Treasury take over all the RFC gold holdings and end its connection with the monetary program. It was admitted that heavy purchases at London and Paris had been made recently for American account through the RFC, this being held necessary to hold down the dollar on foreign exchanges pending the announcement to-day that the 60-cent dollar would be the maximum point of devaluation. It is understood that there has been recently evidence of a considerable return flow of capital to the United States which tended to drive up the dollar abroad. At the Treasury it was explained that the total gold stocks represented about $4,000,000,000 exclusive of about $300.000,000 in "uncaptured" gold outside of the Federal Reserve banks and Treasury. Declines to Talk of Inflation. Any profit in excess of the $2,000,000,000 revolving fund it is understood would go into the Treasury general fund where apparently it would be available for such use as the Treasury saw fit to make of it. The intention as indicated both at the White House and the Treasury to-day was, however, that employment of the profit would be restricted to operation of the revolving fund and that no authority had been requested to issue currency other than gold certificates against it. Secretary Morgenthau was asked if he considered the launching of the now plan as an inflationary step, but would not enter upon a discussion of that point. "There have been a series of steps taken," said Mr. Morgenthau. "They have been satisfactory. This is another step. We wouldn't be taking it If we didn't think it was necessary and will prove effective." Treasury to Move Federal Reserve Bank Gold—Secretary Morgenthau Says Transfer to Washington and Mints Will Take Some Time—Payment in Certificates—Against These the Banks May Issue Reserve Notes with Gold Backing of 40%. In the process of the Treasury's taking over the $2,578,054,000 in gold coin and bullion and $946,133,000 in gold certificates held by the Federal Reserve Banks, an orderly program will be followed, Secretary Morgenthau said on Jan. 15. A Washington dispatch on that date to the New York "Times" added: The total monetary gold stocks of the country on Dec. 31 were $4,322.000,000, of which $3,201,750,000 was held in the Treasury, including $1,767,900,000 for the Federal Reserve Banks and agents. The Reserve Banks had in their own vaults $810,154,000 on that date, while $310,970,000 theoretically was in circulation. Mr. Morgenthau said it was the intention to transfer the Federal Reserve gold not already in the Treasury to the vaults in Washington and to the mints in San Francisco, Denver and Philadelphia and the New York and other assay offices. The process of the transfer of gold is expected to take a considerable time. The Treasury will issue gold certificates, non-circulating, to purchase the gold owned by the Federal Reserve Banks. Against these certificates, which will be held by the banks, Federal Reserve notes may be issued, the gold backing being 40%. Coinage of Gold Ended. In theory the gold certificates call for payment in gold. Mr. Morgenthau, however, explained that all gold would be impounded in the Treasury, which would be its custodian. "The coinage and circulation of gold has been terminated," Mr. Morgenthau explained. "It will be used in bullion form for the settlement, whore necessary, of international transactions." The now arrangement, he said, has not returned the United States to the gold standard. Purchase of gold from the New York Reserve Banks and tho RFC will be made at the statutory price of $20.67 a fine ounce, except on newly mined gold in the United States, which will be purchased by the New York bank at a net price of $34.45, less X of 1% for handling charges on a temporary basis until the recommendations of the President are approved by Congress. The Secretary of the Treasury has the authority to purchase gold coins of any denomination whore, in his opinion, it is compatible with the public Interest under a law enacted in 1867. These purchases may be made at above the statutory price. Banks Would Get Certificates. The gold held by the Reserve Banks would be shipped to the Treasury or to the nearest mint or assay office designated by the Secretary of the Treasury, through the usual commercial channels. In receipt the Federal Reserve Banks would receive an equal amount in gold certificates at the rate of $20.67 per ounce. Secretary of Treasury Morgenthau in Memorandum to President and Congress Proposes Amendments to Administration's Monetary Bill Governing Purchase of Gold—Suggests Wider Latitude in Refinancing Operations. On Jan. 18 Secretary of the Treasury Morgenthau in a memorandum submitted to President Roosevelt, Senator Fletcher and the House Banking Committee proposed a series of amendments to existing law which would give him wider latitude in financing and refunding operations so that banks and insurance companies would be permitted to take up the major share of government issues. He asked that they be attached as a rider to the monetary 425 measure, according to the Washington dispatch Jan. 18 to the New York "Times" which also noted: Appeal to Large Investors. Secretary Morgenthau's amendments for wider latitude in refinancing operations were laid before the Senate Committee this afternoon. Of outstanding importance, as explained by Mr. Morgenthau, is a provision to enable the Treasury to make an offering of bonds which would be particularly appealing to certain large investors, such as insurance companies, and would not necessarily have to be offered as a "popular" loan. The form of such bonds would be left largely to the discretion of the Secretary of the Treasury, as would such conditions as denominations, maturities and interest rates. Another outstanding provision would permit the issuance of Treasury notes—securities running from one to five years maturity—up to a total of $10,000,000,000. This is an increase of $2,500,000,000 over the present Still another would so change existing law as to permit the Treasury to issue certificates of indebtedness as well as Treasury bills on a discount basis. In his message to the Congress the President said: — "Certain amendments of=iziglegisMiro—n—relating"to the purchase and sale of gold and to other monetary matters would add to the convenience of handling current problems in this field. The Secretary of the Treasury is prepared to submit information concerning such changes to the appropriate committees of the Congress." The miscellaneous minor matters here referred to are covered by the attached draft, which is suggested as a new Section 14 to the bill now before your Committee. Sections 14, 15 and 16 becoming Sections 15, 16 and 17. respectively. This addition to the bill is designed to accomplish the following purposes: (a) To enable the Treasury to make an offering of bonds that will be particularly appealing to certain large investors such as insurance companies. (b) The proceeds of all other United States obligations may now be deposited in designated depositories, which arrangement facilitates their sale. It is desired to include Treasury bills. (c) It is desired to increase by $2,500,000,000 the amount of Treasury notes whichlmay be issued, the purpose being to facilitate the marketing of Government obligations which this will do because of the greater demand for this type of security. (d) Treasury notes may now be issued to provide for the purchase or redemption of notes. Certificates and bills may be issued to provide for the purchase or redemption of certificates or bills. It will facilitate Government refunding to have authority to purchase any class of Government securities with the proceeds of any other class. (e) At the present time, we are authorized to issue only Treasury bills on a discount basis. Authority is desired to issue any obligations of the United States with a maturity of not longer than one year on a discount basis. lap(f) At the present time, the Treasury authority to purchase bonds and notes for the sinking fund is restricted to bonds and notes which were issued for refunding purposes or were outstanding on the date named in the statute. It is desirable to be able to use the sinking fund to purchase bonds or notes which have been issued for purposes other than refunding. (g) Gold certificates may not now be issued against gold unless deposited by private persons for the issuance of gold certificates, except that the Secretary may pay out or issue gold certificates in payment of interest on • the public debt. There should be authority to issue gold certificates against any gold in the Treasury except the gold reserves. Amendment to Second Liberty Bond Act. Sec. 14. A. The Second Liberty Bond Act, as amended, is further amended as follows: • a) By adding at the end of Section I (USC, Tit. 31, Sec. 752) a new ( paragraph as follows: "Notwithstanding the provisions ofthe foregoing paragraph,the Secretary of the Treasury may from time to time, when he deems it to be in the public interest, offer such bonds otherwise than as a popular loan and he may make allotments in full, or reject or reduce allotments upon any applications whether or not the offering was made as a popular loan." (b) By inserting in Section 8 (USC, Tit. 31, Sec. 771). after the words "certificates of indebtedness," a comma and the words "Treasury bills." (c) By striking out the figures "$7,500,000,000" where they appear in Section 18(USC,Tit. 31, Sec. 753), and inserting in lieu thereof the figures "$10,000,000,000." (d) By adding thereto two new sections, as follows: "Sec. 19. Notwithstanding any other provisions of law, any obligations authorized by this act may be issued for the purchase, redemption or refunding, at or before maturity, of any outstanding bonds, notes, certificates of indebtedness, or Treasury bills, of the United States, or to obtain funds for such purchase,redemption, or refunding, under such rules, regulations,terms,and conditions as the Secretary ofthe Treasury may prescribe." Issuance of Treasury Obligations on Discount Basis. "Sec. 20. The Secretary of the Treasury may issue any obligations authorized by this Act and maturing not more than one year from the date of their issue on a discount basis and payable at maturity without interest. Any such obligations may also be offered for sale on a competitive basis under such regulations and upon such terms and conditions as the Secretary of the Treasury may prescribe, and the decisions of the Secretary in respect of any issue shall be final." Ix,B. Section 6 of the Victory Liberty Loan Act (U. S. Code, Tit. 31, Sec. 767) is amended by striking out the words "for refunding purposes," together with the preceding comma, at the end of the first sentence of subsection (a). C. The Secretary of the Treasury is authorized to issue gold certificates in such form and in such denominations as he may determine, against any gold held by the Treasurer of the United States, except the gold fund held as a reserve for any United States notes and Treasury notes of 1890. The amount of gold certificates issued and outstanding shall at no time exceed the value, at the legal standard, of the gold so held against gold certificates. Senate Committee Opposition to Administration's Gold Bill Reported Growing—Views of Eugene R. Black and Adolph C. Miller of Federal Reserve Board at Closed Session of Committee—Public Hearing Decided Upon. Incident to the views presented on Jan. 18 before the Senate Banking and Currency Committee by Governor Eugene R.Black of the Federal Reserve Board and Adolph C. Miller, a member of the Board, to which reference is made 426 Financial Chronicle elsewhere in these columns to-day, a Washington dispatch Jan. 18 to the New York "Herald Tribune" said in part: It was made plain by Governor Black and Mr. Miller. who appeared in a closed session, that, while the Board was not opposing allocation of the socalled profit from revaluation to the Government, it was not now in favor of the Government taking over the Reserve System gold. If it is to be done, however, the Board holds it should be by Congressional action and not by direction of the Secretary of the Treasury or by any other administrative action. Senate Opposition Mounting. The Senate Banking Committee to-day gave evidence of growing sentiment against the Administration gold bill and decided to open its doors to public hearings to-morrow afternoon. It made public the statement which Governor Black made before the Committee. This revealed what had not previously been fully disclosed, that for weeks the Reserve Board fought against the idea of commandeering of the Reserve System gold by administrative authority. It opposed the plan of Henry Morgenthau Jr.. Secretary of the Treasury, who desired legislation to take over the gold. Finally, President Roosevelt acceded to the view of Governor Black and the Board that the question of the Government taking over the gold should be put before Congress. Forcing of a public hearing before the Senate Banking Committee was regarded as an indication of growing sentiment in the Committee against the Administration's bill. However, there was no vote on the question. Senators Carter Glass of Virginia, Thomas P. Gore of Oklahoma and others Insisted upon public hearings. Professor James Harvey Rogers, Professor George F. Warren, Roy A. Young of Boston, former Governor of the Federal Reserve Bank; former Senator Robert L. Owen of Oklahoma, and perhaps others will be heard at the open sessions. Close Vote Predicted. A close vote in the Senate Banking Committee, with possible amendments, was predicted to-night. It is uncertain when the Senate will vote on the bill. There are signs of a week or more of debate. Meantime, the House Is preparing to rush the bill to quick passage, Saturday. . . . Some members of the Committee contend it the Federal Reserve System) ultimately will be put out of business and the Treasury be made a Central Bank under the Administration plan, or, as Senator Glass puts it, "Secretary Morgenthau will be a Central Bank." Pronounced sentiment exists in the Senate Banking Committee for limitation of the powers of the Secretary of the Treasury over the proposed $2,000,000,000 stabilization fund. Senator Alva B. Adams, Democrat, of Colo redo, to-day declared he did not believe the Secretary of the Treasury should be authorized to engage in foreign exchange transactions. Administration Seeks Passage of Gold Bill Not Later Than Feb. 23—Analysis by Representative Steagall of Administration's Monetary Bill—Views of Senator Thomas. The House of Representatives planned to take up the new gold legislation proposed by the Administration at its session to-day (Jan. 20). Late yesterday House leaders said they would remain in'continuous session until the bill is passed. Secretary of the Treasury Morgenthau said yesterday that passage of the legislation in amended form by both House and Senate before Tuesday night (Jan.23) was "imperative." It was also revealed that the Administration hopes to insure complete secrecy of operation of the $2,000,000,000 stabilization fund. It was said in Washington that the chief reasoni for the wish of the Administration that the bill be enacted quickly was the desire to end uncertainty of its refinancing plans and to place the proposed dollar stabilization fund in operation in the foreign exchange markets. Early action on the bill to carry out the President's monetary recommendations was forecast on Jan. 15 by Chairman Fletcher of the Senate Banking and Currency Committee, according to advices Jan. 15 to the New York "Times" which added that the arrival of the measure at the White House set off an immediate dispute between the Banking and Currency and the Coinage, Weights and Measures committees over jurisdiction, but this was not expected to cause any delay there because of the President's undisputed control ov3r the lower body. From the dispatch we also quote in part as follows: Senator Fletcher predicted that the bill in its final form would be substantially as sent to him from the Treasury to-day. He expected that the contents would be gone over thoroughly, but he had no thought that there would be any major changes. Analysis of Bill by Steagall. An analysis of the draft of the Administration's monetary bill was made by Chairman Steagall of the House Banking and Currency Committee. The measure, he said: 1. Transfers to the United States the ownership and possession of all Federal Reserve Bank gold (including that held by the Federal Reserve Board and Federal Reserve agents) and provides for payment therefor in gold certificates. 2. Authorizes the Federal Reserve banks to maintain reserves against Federal Reserve notes entirely in gold certificates. 3. Clarifies the Government's power to regulate the acquisition, transporting, melting, or treating, import, export or earmarking of gold. 4. Provides forfeiture of gold withheld, acquired, transported, melted or treated. imported, exported or earmarked in violation of this bill or regulations of the Secretary of the Treasury, and also a penalty equal to twice the value of the gold. 5. Provides that no gold shall hereafter be coined, and that no gold coin shall hereafter be paid out or delivered by the United States. and that all gold coin of the United States shall be withdrawn from circulation and formed into bars. There is provision for releasing gold bars to pay foreign balances, and for industrial, professional and artistic uses, and for other purposes not inconsistent with the bill. 6. Provides that no currency of the United States shall be redeemed in gold except to the extent permitted in regulations issued by the Secretary of the Treasury with the approval of the President, but that gold certifi- Jan. 20 1934 cates owned by Federal Reserve banks shall be redeemed at such times and In such amounts as in the judgment of the Secretary of the Treasury are' necessary to maintain equal purchasing power of every kind of currency of the United States, and that the reserve for United States notes and for Treasury notes of 1890 and the security for gold certificates shall be maintained in gold bullion equal to the dollar amounts required by present law. 7. Establishes a method of accounting for the gain or loss in value' of Treasury gold occasioned by any change in the weight of the gold dollar. 8. Clarifies present laws which authorize the purchase and sale of gold by the Secretary of the Treasury. 9. Establishes a stabilization fund and appropriates $2,000,000,000 for the purpose, but only out of the profits on devaluation, which are directed to be converted into the Treasury under the bill; and provides that the President shall cause an audit to be made of such fund and a full report thereof be included in the next succeeding annual report of the Secretary of the Treasury. 10. Limits the President's power to fix the weight of the gold dollar te weights between 50 and 60% of the present weight and makes it clear that his various powers under paragraph (b) (2) of the Thomas amendment are continuing and distinct. 11. Approves and confirms action taken by the President and the Secretary of the Treasury under the Act of March 9 1933 and Sections 43 and. 45 of the Act of May 12 1933. Senator Thomas's View. Senator Thomas said that the President's money message outlined and clarified the Administration's progress. The new steps to be taken are outlined as follows: "All monetary gold is to be nationalized. This means that all gold coins and gold bars are to be collected and placed in the Federal Treasury here in Washington and to become the common property of all the people. The Federal Government stands back of all paper money; hence it is proper that all reserves should be in the hands of the Federal Government. "All monetary silver likewise is to be nationalized. Subsidiary silver • will continue to circulate and perhaps some silver dollars, but the bulk of our silver likewise will be collected and placed in the Federal Treasury to become reserves for the issuance of paper currency. Under the new policy gold coins will not be permitted in circulation. "All gold coins will be collected and melted into convenient sized bars. In the future gold will be transferred only in the adjustment of international settlements. "The exact status of silver in our future monetary policy has not been fixed; hence it is a matter for further consideration and adjustment." J. P. Morgan Declines to Comment on President's Monetary Proposals—Banker En Route to Bahamas. J.P. Morgan declined to comment on President Roosevelt's latest monetary move when he arrived at Brunswick, Ga. on Jan. 16 to board his yacht, the Corsair, for a cruise to the. Bahamas. Associated Press advices from Brunswick added: Asked for his views on the President's plan to devaluate the dollar, thebanker replied: "I have no comment to make. I'm getting away from all that now and Planning a vacation trip." The financier arrived here on a special train accompanied by several friends. They left the train almost immediately to board the yacht. Mr. Morgan is President of the Jekyll Island Club and it was understood here the party would go there in the afternoon for a short stop before• beginning the Bahama cruise. Governor Black of Federal Reserve Board Expresses. View That Profit on Gold Should Go to Government—As to Question of Transfer of Title to Reserve System's Gold, Says This Should Be' Determined by Congressional Legislation. In a statement issued at Washington on Jan. 16, Eugene R. Black, Governor of the Federal Reserve Board, makes. known that it is the view of the Board that the enhanced value arising through the monetary policy of the Government, "should inure to the Government." ,As to the further question of the transfer of the title to the Reserve System' gold to the Government, prior to devaluation, GovernorBlack says "the System has felt and has urged that this: question was of such large import as to demand its determination by Congressional import." Governor Black's statement follows: For the past several weeks there have been conferences between the President, the Secretary of the Treasury and representatives of the Reserve' System upon two questions: First, the allocation of the increase in value of the Reserve System's gold consequent upon devaluation, and, Second, the transfer of the title to the Reserve System's gold to the• Government prior to devaluation. We have felt that these two questions, were not interdependent. As to the first question, the Federal Reserve Board after advising with the Governors of the Reserve banks, has felt that the Reserve banks should not be the beneficiaries of the enhanced value placed upon their gold holdings by a purely monetary policy of the Government, but on the contrary that such enhanced value arising solely through such monetary policy of the Government should inure to the Government. This feeling has. been based upon the Conviction that such enhanced value will result solely from a Governmental policy and not from any action or effort on the part of the Reserve banks. This position has been expressed to the President. The second question embracing the matter of title to the gold of the• Reserve banks has similarly been discussed with the President and the. Secretary of the Treasury by representatives of the Reserve System. The. System has felt and has urged that this question was of such large import as. to demand its determination by Congressional legislation. In line with this position, on Dec. 29 I wrote the President regarding these two questions and in the course of that letter set forth the following' reasons for Congressional action: "First: It relieves what is to me a serious difficulty presented to the. Secretary in the question of his right to requisition gold of the Reserve. System under the statute authorizing requisition of gold in protection or the currency system of the country. Volume 138 Financial Chronicle "Second: It presents the opportunity to Congress of granting by Congressional action protection to the Reserve System in event of future revaluation upward of the dollar. "Third: It gives to Congress the right to allocate the profit upon gold in the event of devaluation. "Fourth: It leaves to Congress the full question of legislation relative to the Reserve System and its currency, both creations of Congress. "Fifth: It will obviate all chances of criticism upon the Reserve System and upon the Administration in respect to the problem involved, and all uneasiness and unrest as to Reserve banks and their credit and currency functions. "May I earnestly urge that this Congressional course is the straight, simple, legal course to all the ends desired. "In conclusion, Mr. President, may I assure you that this suggestion is not written in the selfish interest of the Reserve banks, but in the intertat of your Administration and of the country, as an evidence of which I desire to repeat that the question of profit on our gold is not involved, and I have heard no other suggestion from any member of our board or any Reserve bank than that any profit arising from a monetary policy of the Government should go to the Government." Following this letter the President decided that the question of the transfer of the title to the System's gold should be referred to Congress for determination. I understand that the proposed bill is for this purpose. The present security of Reserve note issues comprises eligible paper, Governments, gold and gold certificates. The proposed bill names the same security for note issues except that the gold proposed to be taken from the Reserve banks by the Treasury is to be replaced by gold certificates issued by the Treasury and redeemable in gold by the Treasury at such times and in such amounts as,in the judgment of the Secretary of the Treasury, are necessary to maintain the equal purchasing power of every kind of currency of the United States. The security for the gold certificates is maintained by the Treasury in gold bullion. Federal Reserve notes under the new bill, as under the old law, are the obligations both of the Reserve bank issuing them and of the United States, President's Plan for Impounding Federal Reserve Gold Held Constitutional by Attorney-General Cummings—Opinion Before Senate Committee Contends Government Can Act Under Right of Eminent Domain—Senator Glass Remains Unconvinced of Legality of Proposed Measure. Attorney-General Cummings, appearing before the Senate Banking and Currency Committee on Jan. 17, presented an opinion in which he held constitutional in every respect President Roosevelt's plan for the Treasury to impound the gold held by the Federal Reserve banks. The AttorneyGeneral ruled that since the member banks of the Federal Reserve System have no claim against the assets of the Federal Reserve banks except as stockholders, it cannot be contended that in transferring any assets of a corporation any compensation should be paid directly to its stockholders. He further contended that the amount of just compensation is to be determined at the time of taking the assets, and not on some subsequent date, thus justifying the intention of the Government to take over the gold profits that would arise as a result of devaluing the dollar. Mr. Cummings based his arguments upon the contention that under the right of eminent domain the Government could take over any property required for the public use, citing numerous authorities to support his belief that impounding gold for monetary purposes was "unquestionably" for a public service. His opinion was given to the Senate Committee in reply to questions raised on Jan. 16 by Senators Glass and McAdoo. Governor Eugene Black of the Federal Reserve Board also appeared before the Committee on Jan. 17 and testified in secret session. Washington adviees to the New York "Times" reported that Governor Black said it was the Board's position that the President under existing law would not have the power to impound the gold in Reserve vaults. The Washington dispatch referred to discussed Mr. Cummings' opinion in part as follows: The Attorney-General's opinion had only to do with Section 2 (a), or the provisions regarding the seizure by the Treasury of all gold held in the Federal Reserve banks. The opinion was prepared originally for Secretary Morgenthau. It was addressed to him at the Treasury to-day. But when notice. was served upon Mr. Cummings that members of the Senate Banking and Currency Committee demanded word from him on the legality of the gold seizure, he went to the Capitol to deliver it in person. At the outset of his opinion, Attorney-General Cummings cited the findings of the Supreme Court in Kohl vs. the United States, that the right of eminent domain "is inseparable from sovereignty"; from United States vs. Jones that the right of eminent domain "belongs to every independent government"; and Socombe vs. Railroad Co., in which the Court said: "There is no limitation upon the power of the Legislature In this respect, if the purpose be a public one, and just compensation be paid or tendered to the owner for the property taken." As to "Just Compensation." Holding the seizure of the Federal Reserve gold to be merely the exercising of this right, the Attorney-General concerned himself with the question of "just compensation." "The requirement for just compensation Is completely satisfied by the provision for payment in gold certificates in equivalent amounts of dollars," he said. He added that since the decision the legal tender cases "It may no longer be successfully disputed that Congress may make paper money legal tender for the payment of all debts, public or private, and that the Government may discharge its obligations in currency of that type." "The amount of just compensation is determined," he continued, as of the time of taking and not as of any subsequent date. The fact that the 427 property may later be enhanced does not, be said, increase the compensation to which the owner is entitled. "Thus, in this instance, the value of the gold must be determined as of the moment that title passes to the United States," he said. "The mere fact that, if thereafter the weight of the gold dollar should be reduced the value of the gold would become proportionately greater, does not serve to give the prior owner any right to secure increased reimbursement." Prevailing Price Is No Rule. The opinion said that the measure of compensation must be the pre-. vailing price—in this instance the prevailing price of gold coin and gold bullion as fixed by statute-620.67 an ounce. The fact that the world price might be higher availed nothing, because owners in this country had. no way to offer their gold in the world market under the prohibition, promulgated under the Act of March 9 1933. As to the question of an ownership interest of the Federal Reserve member banks in the gold, he stated the opinion that "this inquiry should be answered in the negative." The member banks, he said, "had no claim against the assets of the Federal Reserve banks except as stockholders "and, of course, it cannot be contended that in taking any of the assets of a corporation, any compensation should be paid directly to the stockholders thereof." "The gold reserves of the Federal Reserve banks must not be confused with the reserve balances which every member is required, by Section 19. of the Federal Reserve Act, to miintain with the Federal Reserve bank." he said. "The reserve balances of the member banks need not be in gold." "Clear as a Bell," He Says. Summing up his conclusions to newspaper correspondents, AttorneyGeneral Cummings said: "There is no doubt whatsoever about constitutionality of Section 2 (a) of the bill. It's as clear as a bell." He had hardly finished the sentence when Senators Glass and McAdoo„ arm in arm, came out of the Committee room. "Well. Carter, at least we have a legal opinion on the question," said Senator McAdoo with a smile. "Legal opinion? Legal opinion"? Senator Glass snapped. "I call it an 'illegal' opinion." Senator McAdoo said the opinion had gone a long way toward answering, his objections. He would not state a position on the measure at this time, however. He exhibited some annoyance that he had been referred to in. newspaper accounts this morning as in "revolt" against the Administration, on the Roosevelt money policies. "I want to get all the facts in the case and that is why I joined yesterdayin asking for an opinion from the Attorney-General on the constitutionality of the section," he added. Senator Glass was as outspoken as ever against the policy. "That opinion did not change my views one particle," he said. The complete text of Attorney-General Cummings'opinion on the constitutionality of the President's proposed gold legislation, as made public by the Senate Banking and Currency Committee Jan 17, follows: Jan. 17 1934. The Honorable, the Secretary of the Treasury, My Dear Mr. Secretary: I am pleased to comply with your request for an expression of my views as to the constitutionality of Sec. 2 (a) of the proposed Gold Reserve Bill. The section under consideration provides that all right, title and interest, and every claim of the Federal Reserve Board, of every Federal Reserve bank, and every Federal Reserve agent, in and to any and all gold coin and gold bullion shall pass to and are hereby vested in the United States, Payment is to be made in gold certificates in equivalent amounts of dollars. The monetary gold stock may be taken by the Government in the exercise of its right of eminent domain. Such power extends to every form of property required for public use. The Supreme Court observed in Kohl vs. United States, 91 U. S., 367, 371, that the right of eminent domain "is inseparable from sovereignty," and in United States vs. Jones, 109, U. S., 513, 518, that it "belongs to every independent government." In Control of Legislature: The manner in which the power is exercised is within the control of the Legislature. This principle was formulated in Secombe vs. Railroad Co., 23 Wall 108, 117. in the following language: "It is no longer an open question in this country that the mode of exercising the right of eminent domain, in the absence of any provision in the organic law prescribing a contrary course, is within the discretion of the Legislature. There is no limitation upon the power of the Legislature in this respect, if the purpose be a public one, and just compensation be paid or tendered to the owner for the property taken." Likewise the necessity for the exercise of the power Is a matter solely for Legislative determination. Monongahela Navigation Co. vs. United States, 148 U. S. 312, 327. Unquestionably, the taking of gold for monetary purposes is for a public use. The establishment and the regulation of a monetary system is one of the fundamental functions of government. The power to coin money and regulate the value thereof is expressly reposed in Congress by Article 1, Sec. 8, Clause 5, of the Constitution. Veazie Bank vs. Fenno, 8 Wall 533, 549. In fact monetary gold is a commodity affected with a public interest, Ling Su Fan vs. United States, 218. U. S. 302. Holds Compensation Is Satisfied. The requirement for just compensation is completely satisfied by the provision for payment in gold certificates in equivalent amounts of dollars. Since the decision in the Legal Tender Cases, 12 Wall 457, it may no longer be successfully disputed that Congress may make paper money legal tender for the payment of all debts, public or private, and that the Government may discharge its obligations in currency of that type. The amount of just compensation is determined as of the time of taking, and not as of some subsequent date. The mere fact that at a later period the property may acquire an enhanced value, or that there may be an accretion to the thing taken, does not increase the compensation to which the owner is entitled. Thus, in this instance, the value of the gold must be determined as of the moment that title passes to the United States. The mere fact that, if thereafter the weight of the gold dollar should be reduced. the value of the gold would become proportionately greater, does not serve to give the prior owner any right to secure increased reimbursement. Brooks Scanlon Corp. vs. United States, 265 U. S., 106. Must Pay Prevailing Price. The measure of compensation must be the prevailing price. Vogelstein vs. United States. 262 U. S., 337. The prevaling price of gold coin and gold bullion in the United States (other than newly mined gold) is fixed by 428 Financial Chronicle statute. The act of March 14 1900 (U. S. Code, Title 31, Pgh. 314) prescribes that the weight of the gold dollar shall be 25 8.10 grains, 9-10ths fine, which in turn makes gold worth $20.67 an ounce. That is the price that the owner of gold would have received at the mint, if he had presented it for deposit, prior to March 4 1933. That is likewise the price that he would have received at any subsequent time if he surrendered it in accordance with the requirements of the Executive orders or the orders of the Secretary of the Treasury issued under the act of March 9 1933. This Is also the price that it is proposed to pay for the gold to be taken under Sec. 2 of the bill under consideration. The conclusion seems inescapable that this provision safeguards the Owners in their right to receive as just compensation the value prevailing at the time of taking. World Price Not Applicable. The fact that the market price of gold in foreign countries is greater than the statutory price in the United States avails the owners nothing. An owner of gold in the United States has no way of shipping the gold abroad in view of the prohibition against the export of gold from this country, promulgated under the Act of March 9 1933. Consequently, an owner of gold in the United States is in no position to secure the so-called "world price," and therefore his gold is not worth more than the statutory price. The prohibition of the export of gold is constitutional. Thus, in Ling Su-fan vs. United States, 218 U. S. 302, the Supreme Court upheld the validity of an Act placing an embargo on the export of silver coin from the Philippine Islands, in spite of the contention that the result was a taking of property, because of the fact that in China silver bullion had a higher market value than its nominal coinage value in the Philippines. Banks Have No Claim. The question has been raised as to whether the member banks have any right, title and interest in the gold coin or bullion held by the Federal Reserve banks. In my opinion, this inquiry should be answered in the negative. The member banks have no claim against the assets of the Federal Reserve banks except as stockholders, and, of course, it cannot be contended that in taking any of the assets of a corporation any compensation should be paid directly to the stockholders thereof. Every Federal Reserve bank is now required to maintain a gold reserve against circulating notes and deposits (Federal Reserve Act, Section 16; U. S. Code, Title 12, Section 413). Any part of such reserve may be used as part of the collateral for Federal Reserve notes, which is required to be deposited with Federal Reserve agents. The mere fact that the source of some or all of such gold may be deposits made by member banks with the Federal Reserve banks is immaterial. As soon as the gold is deposited with the Federal Reserve bank it loses its identity and the relationship between the Federal Reserve Bank and the member banks becomes that of debtor and creditor. Reserve Balances Separated. The gold reserves of the Federal Reserve banks must not be confused with the reserve balances which every member is required, by Section 19 of the Federal Reserve Act, to maintain with its Federal Reserve bank. The reserve balances of the member banks need not be in gold. In closing, I desire to call to your attention the following expressions of the Supreme Court in Ling Fan vs. United States, 218 U. S.. 302, 310: "Conceding the title of the owner of such coins, yet there is attached to such ownership those limitations which public policy may require by reason oftheir quality as a legal tender and as a medium of exchange. These limitations are due to the fact that public law gives to such coinage a value which does not attach as a mere consequence of intrinsic value. Their quality as a legal tender is an attribute oflaw aside from their bullion value. They bear, therefore, the impress of sovereign power which fixes value and authorizes their use in exchange." The foregoing considerations lead me to the conclusion that Sec. 2 (a) of the bill is constitutional. Yours very truly, HOMER CUMMINGS, Attorney-General. Senator Glass Challenges Legality of Proposed Monetary Legislation—Declares Attorney General Cummings in His Opinion Omitted Pertinent Supreme Court Decisions. Senator Carter Glass, former Secretary of the Treasury, yesterday (Jan. 19) challenged the constitutionality of the Administration's currency devaluation bill, and declared that in upholding its legality Attorney-General Cummings had failed to cite Supreme Court decisions pertinent to the question. Senator Glass, in a memorandum inserted in the Congressional Record, mentioned two Supreme Court decisions which, he said,ruled that the fixing of compensation for property seized by the Government is a judicial and not a legislative function. A Washington dispatch of Jan. 19 to the New York "Sun" further summarized the Senator's memorandum as follows: Pointing out that, though the bill is being considered in "secret executive session" of the Senate Banking Committee, Mr. Cummings opinion upholding the constitutionality of seizing the Federal Reserve gold had been made public, Mr. Glass said he wanted to place in the record some statements bearing on the question "which the attorney,I suppose inadvertently, omitted." Points to "Vital Omission." He said that Mr. Cummings had referred to the case of the Monongahela Navigation Company against the United States, but had omitted a "very vital" part of the Supreme Court's decision holding that Congress could decide what property could be taken by the Government, but not the compensation. Mr. Glass read from the decision a statement that "the Legislature may determine what private property is needed" by the Government, "but when the taking has been ordered then the amount of compensation is a judicial matter" and "not a legislative function." The Virginian also cited a decision in the case of the United States vs. the New River Collieries, saying "the ascertainment of compensation is a judicial function and no power exists in any other department of the Government to declare what the compensation shall be." Mr. Glass said that he considered the gold certificates the Government proposed to offer the Federal Reserve system in exchange for its gold "worthless" and that therefore the exchange would be illegal. He said that the Government was offering paper which had been "repudiated in advance." Jan. 20 1934 Secretary Morgenthau Extends Period for Return of Gold—Orders Payment at Face Value Until Further Notice, with Bullion Rate Fixed at $20.67 a Fine Ounce. Secretary of the Treasury Morgenthau on Jan. 17 issued an order extending until further notice the period during which gold coin, bullion and certificates might be surrendered, and gave instructions for the continued receipt of gold and payment at face value. A previous order had fixed midnight of Jan. 17 as the deadline and had said that if gold were held beyond that time in non-compliance with the regulations, it would be seized if turned in and applied on a possible maximum penalty of twice the amount of gold held. The new order authorized the Treasurer of the United States, the Mints and Assay Offices and the • Reserve Banks to receive and pay gold at the statutory rate of $20.67 a fine ounce. The Treasury said on Jan. 17 that its order of that date does not remove gold hoarding penalties if, in the opinion of the Secretary, the gold paid in has been hoarded. The text of the Secretary's new order follows: Instructions sent by the Secretary of the Treasury on Jan. 17 1934 to the Treasurer of the United States, the United States mints and Assay Offices and the fiscal agents of the United States, concerning wrongfully withheld gold coin, gold bullion and gold certificates delivered after Jan. 17 1934. The order of the Secretary of the Treasury dated Jan. 15 1934, supplementing the order of Dec. 28 1933, requiring the delivery of gold coin, gold bullion and gold certificates to the Treasury of the United States provides, in part, as follows: ". . . I, Henry Morgenthau, Jr., Secretary of the Treasury, do hereby fix midnight of Wednesday, Jan. 17 1934, as the expiration of the period within which any gold coin, gold bullion or gold certificates may be paid and delivered to the Treasurer of the United States in compliance with the requirements contained in such order of Dec. 28 1933, as amended. In the event that any gold coin, gold bullion or gold certificates withheld in noncompliance with said order and of this order are offered after Jan. 17 1934 to the Secretary of the Treasury, the Treasurer of the United States, any' United States mint or Assay Office, or to any fiscal agent of the United States, there shall be paid therefor only such part or none of the amount otherwise payable therefor as the Secretary of the Treasury may from time to time prescribe, and the whole or any balance shall be retained and applied to the penalty payable for failure to comply with the requirements of such order and of this order. The acceptance of any such coin, bullion or certificates after Jan. 17 1934, whether or not a part or all of the amount otherwise payable therefor Is so retained, shall be without prejudice to the right to collect by suit or otherwise the full penalty provided in Section 11(a) of the Federal Reserve Act, as amended, less such portion of the penalty as may have been retained as hereinbefore provided. Subject to the rights reserved in said order of Jan. 15 1934. supplementing the order of Dec. 28 1933 requiring the delivery of gold coin, gold bullion and gold certificates to the Treasurer of the United States, and without prejudice to the right to alter or amend these instructions from time to time by notice to the Treasurer of the United States, the United States mints and Assay Offices, and the Federal Reserve Banks, I do hereby prescribe that in the event that any gold coin, gold bullion or gold certificates held in noncompliance with said order of Dec. 28 1933, as amended, and said order of Jan. 15 1934, are offered after Jan. 17 1934 to the Secretary of the Treasury, the Treasurer of the United States. any United States mint or Assay Office or to any fiscal agent of the United States, the Secretary of the Treasury, the Treasurer of the United States, any United States mint or Assay Office and the fiscal agents of the United States shall pay for such gold coin and gold certificates the dollar face amount thereof, and for gold bullion $20.67 an ounce. Member banks of the Federal Reserve System may receive such gold for account of the Treasurer of Coin. gold bullion and gold certificates the United States and forthwith forward the same to the Secretary of the Treasury, the Treasurer of the United States, any United States mint or Assay Office or any fiscal agent of the United States, whichever is nearest. A statement issued at the Treasury Jan. 17 explaining the new order said: Inquiries have been received by the Treasury Department from business men who desire to know whether they may continue to accept gold coin and certificates in payment for merchandise and services. The instructions which were sent out to-night will provide a way by which they may dispose of receipts of gold coin and gold certificates and receive payment for them. $12,307,110 in Hoarded Gold Returned to Treasury Between Dec. 28 and Jan. 17—Secretary Morgenthau Explains Reason for Extension of Deadline. Returns of gold to the Treasury since Dec. 28, the date of issuance of the order requiring all gold to be returned to the Treasury, amounted to $12,307,110 up to Jan. 17, according to an official announcement on the following day. This sum included $7,484,410 in certificates, $4,626,682 in coin and $191,018 in bullion. Secretary Morgenthau said on Jan. 18 that he had extended the deadline for the return of the metal because of the evident intention of most holders of gold to return it to the Treasury. He said that he wished to give all those desiring to return gold the opportunity to do so, and pointed out that delays might occur in connection with returned gold certificates from foreign countries. A Washington dispatch of Jan. 18 to the New York "Journal Commerce," discussing the gold return, added the following information: Coincident with Mr. Morgenthau's statement, Attorney-General Cummings revealed that of the 166 cases originally presented to grand juries or prepared for presentation involving gold hoarding, 109 had been dls- Volume 138 Financial Chronicle missed, principally because the gold was turned in. These involved $262,894. Twelve persons have been indicted for failing to return gold, three true bills having been dismissed on the return of the gold. Mr. Cummings said that there would be no appeal in the case of Frederick Campbell, New York Attorney, wherein the court sustained a demurrer to a count of the indictment charging failure to turn in gold. The court upheld the count charging failure to make a return showing the amount of gold held. The Government will prosecute Mr. Campbell for failure to file a return. The attorney, Mr. Cummings revealed, held 27 bars of gold valued at approximately $5,000 each. He authorized the Chase National Bank to return 26 of these bars and they have been put in posession of the Treasury. The bank, acting for Mr. Campbell, asked the Treasury for permission to retain one bar, but was refused the permission. The bank still has the gold, according to the Attorney-General's information. Mr. Campbell wanted to retain it to permit him to have a case wherein the gold order could be tested. Mr. Morgenthau said that the Treasury will not make public the amount of gold purchased by the Federal Reserve Bank of New York, as the fiscal agent of the Government. To Administer Regulations. The New York bank will administer the exchange regulations which will be made public soon, Mr. Morgenthau said. The Treasury plans to announce the new financing program, which will initiate the $10,000,000,000 borrowing for refunding and for emergency purposes soon, Mr.Morgenthau declared. He said that the Treasury would not await legislation authorizing the President to revalue the dollar. Mr. Morgenthau said that the Administration was watching the inward movement of capital very closely. He did not know as yet in what volume capital is moving into the country. This movement was believed to be responsible partially for the increase in dollar quotations abroad. 429 Canadian Dollar. The Canadian dollar advanced still more slowly. The gain for the day close of exactly that premium. The pound, in bringing it to a was %c., comparison, advanced 4,54c., closing at $5.13%. Based upon its quotation in francs, sterling is at its low in terms of gold. With sterling quoted at 80.4 francs, its value in terms of the old par dollar approximates $3.15. The decline in sterling and in sterling area currencies indicated the continued danger of competitive currency depreciation putting off actual stabilization of the major currencies in terms of each other. It was considered possible that the decline in the gold value of sterling yesterday Indicated either the purchase of francs by the British equalization fund or else market anticipation of such purchases. British purchases of francs, it is expected, would lead quickly to the conversion of these francs into gold, depleting the reserve stocks of the Bank of France. It is assumed that the British will not at present operate in dollars. Sterling reached the high yesterday of 85.16% and closed at $5.13%. The rate had advanced in London before the American market opened. After the publication of the President's message the pound gained more quickly in terms of dollars, but declined against francs. The franc closed at 6.38%,a rise of 24 points. The high for the day was 6.40 and the low 6.14%. Dutch, Belgian and other gold currencies also advanced sharply. On Jan. 16 Jesse H. Jones, Chairman of the RFC, issued the following statement to the effect that gold purchases initiated abroad prior to 12 o'clock noon on Jan. 15 would be completed and that certificates of mints or assay offices for domestic newly mined gold issued prior to midnight Jan. 15 would be honored. Sales of RFC notes for gold have ceased except that certificates of mint or assay offices issued prior to midnight, Jan. 15 1934, for newly mined domestic gold, will be honored by the Federal Reserve Bank for our account, and sales of notes of the Series of Feb. 1 1934 for foreign gold, initiated prior to 12 o'clock noon, Jan. 15, will be completed. The Treasury will take over the RFC gold under arrangements to be worked out. Domestic Gold Buying Price Set at $34.45 an Ounce, First Change Since Dec. 18-RFC Relinquishes Purchasing Operations of Newly Mined Gold to Federal Reserve Bank of New York-Exchange Rates Fluctuate Widely, Following Announcement . Associated Press advices from Washington Jan. 16 said: • of President's Monetary Program. Jones declined to elaborate,. He had nothing to say as to the probable The first change in the official buying rate for newly price the Treasury will pay the Corporation for its gold, although it was mined domestic gold since Dec. 18 was made on Jan. 16, pointed out unofficially in Government financial circles that the whole when the Treasury fixed a price of $34.45 a fine ounce, com- matter would be one "of bookkeeping anyhow." RFC really is nothing more than a fiscal agent for the Treasury, pared with the quotation of $34.06 that had prevailed for theThe law specifying that it shall undertake any fiscal operations the Treasury almost an entire month. This change was announced on may require. The gold purchasing campaign started two months ago 3an. 15, after the delivery of the President's -monetary was such an operation. message to Congress, and Secretary Morgenthau said that The New York "Times" of Jan. 17 described the course in the future no daily prices would be posted, but the $34.45 of the dollar on the previous day as follows: quotation would remain in effect until further notice. At The dollar rebounded yesterday from the level to which it was forced by Recovering this rate the theoretical value of the dollar is exactly 60 the announcement of the President's monetary program. of a cent of the loss of 2.40 cents on Monday, it closed at 62.28% of cents, based on the statutory gold valuation. It was also 0.92 parity indicated the old of parity. This compared with a valuation of 60% announced that purchases of newly mined domestic gold by the Treasury's price of $34.45 an ounce for gold quoted yesterday by of New York. President Roosevelt in presentwould no longer be made by the Reconstruction Finance the Federal Reserve Bank to Congress had set 60% as the upper limit of ing his monetary program Corporation but rather by the Federal Reserve Bank of devaluation and 50% as the lower. market indicated that traders were exchange The action of the foreign New York, acting as the buying agent of the Treasury. A Treasury's ability to force the dollar down to 60% of parity, further statement said that the RFC •ceased its gold pur- doubtful of theestablishment of the proposed 82,000,000.000 equalization pending the chases abroad at noon on Jan. 15. fund. Some bankers believe the fund will not begin to operate until the terms During the entire period of gold purchase operations by of stabilization have been decided; others that means will be found to make comprised 4,030,260 the fund available when and if Congress approves the legislation presented the RFC its total purchases of gold ounces costing $131,671,604, Jesse Jones, Chairman of the to it on Monday. Reasons for Dollar's Rise. RFC, said yesterday (Jan. 19). Domestic purchases Among the reasons assigned by foreign exchange dealers for the recovery amounted to 695,027 ounces costing $23,363,754, and foreign the dollar were the repatriation by Americans of funds sent abroad purchases totaled 3,335,236 ounces costing $108,807,850. of because of anxiety over the future of the currency; a movement of funds Most of the foreign purchases are held in London, Mr. here for investment from Europe and the exhaustion of the first panicky rush of merchants and traders to cover their commitments, which had been Jones added. by the first news of the new policy. The advance in the domestic gold price Jan. 16, following started In the London market a sharp readjustment to the President's announcethe publication of the President's monetary message, caused ment was seen in the rise of the open market price of gold to 131s. 9d., Monday's quotation. This a sharp break in the doliar in terms of most foreign cur- the highest since Nov. 8, and 3s. 3d. above reflected a fall in the value of the pound sterling in terms of francs, the rencies. Later in the week, however, the foreign exchange London gold price being based on the Bank of France's buying price for gold. market presented a confused picture as the dollar rallied converted into sterling with adjustments for shipping costs. Sterling here fell 5% cents to $5.08%, losing more than it had gained on strongly against such currencies as the pound and the yen, Monday, when it had been up 4% cents net. The franc declined 9% Points despite the desire of Treasury officials that its exchange to 6.29yi cents; the guilder dropped 80 points to 64.45 cents; the belga rate be retained around the 60-cent level. This strength 30 points to 22.35 cents and the Swiss franc 43 points to 31.05 cents. None of the gold standard exchanges lost as much as half of the gains they had was ascribed in many quarters to repatriation of American scored on Monday. funds from abroad as a result of indications that the AdminCanadian dollars shared the weakness of sterling, dropping 5-16 cent to istration's monetary policies included a definite plan for a discount of 13 points; marks were off 45 points to 38.05 cents and lira eventual stabilization. It was also reported that foreign declined 13 points to 8.39 cents. We quote from the New York "Herald Tribune" of Jan. 18 capital was being used to purchase American bonds and that some British money was going into the purchase of dollars. regarding the exchange quotations on Jan. 17: The dollar and the pound sterling in concert yesterday brought pressure to The pound sterling closed at $5.033.'3 in New York yesterday bear on the gold standard currencies. As further proof that the attempt (Jan. 19) compared with $5.083 4 a week ago, while the to bring the external value of the dollar down to 60 cents will be no easy one, French franc yesterday was 6.28 cents, against a close of the pound was weaker in terms of gold than was the dollar. But both were lower against the gold bloc. 6.123 % cents Jan. 12. Sterling was 4% cents net lower, closing at $5.04 after touching $5.03. Secretary Morgenthau announced on Jan. 15 that under Reports from London were that the British authorities were not interthe silver-purchase program the Treasury last week purchased vening in the market to keep the American purchases of gold in the open market there from causing the dollar to weaken too rapidly against the 547 ounces of newly mined domestic silver. pound. Nevertheless,for a variety of reasons, the dollar was strong against We quote from the New York "Journal of Commerce" the sterling bloc. Against the franc, however, the dollar lost a little ground. The franc of Jan. 16 regarding the fluctuations in foreign exchange the rose 2;i points and closed at $.061 ,and it carried along with it the rest of previous day: its gold colleagues on the Continent, the belga being up 5 points, lira 2, While the franc and other gold currencies advanced rapidly on publication of the message of the President, the rise of sterling as well as of exchanges which move with the pound was moderate. In terms of French currency, in fact, sterling fell 2.4 francs. Based on closing dollar quotations of pounds and of francs, the sterling rate at the close yesterday was 80.4 francs, against the previous rate of 82.8 francs. marks 10, Swiss francs 5 and guilders 15. At closing time the dollar's external value in terms of the French franc stood at 62.04, compared with the official United States value of 60 cents even. In terms of the pound the dollar's external value was 62.37 cents at the close. It was clear that the Federal Reserve Bank of New York,acting for the Treasury, would have to sell more dollars against foreign exchange Financial Chronicle 430 and buy still more gold abroad if it was to bring the currency's external value in line with the 60-cent internal value. It was noted that, as the pound fell. the Danish, Norwegian and Swedish units fell also. The yen was 20 points lower at .3015. Canadian dollars dropped to a discount of three-quarters of 1%. All of these currencies are pioneers in the depreciation movement, and it was of interest to the foreign exchange market to see that they were weakening more rapidly then the dollar. The British pound was weak again against the franc. Where a few days ago the pound stood at 83 1-3 against the French unit, it was down to about 80 yesterday. Coincidentally the premium on gold in the London open market stood at 10 pence, or enough to make it appear that gold must soon be drawn from the Bank of France by arbitrageurs and shipped to London for sale. The "Journal of Commerce" of Jan. 19 described the foreign exchange gyrations of the previous day as follows: Actively sold in the leading trading centers of the world the pound fell sharply yesterday, closing at 24.95% with a loss for the day of 854c. At the same time British currency also declined in relation to the franc. On the basis of dollar quotations for both currencies it lost .4 francs and was worth 79.3 francs at the close of business. The gold value of the dollar in terms of French francs appreciated from 61.9c. to 62.6c. Commitments to buy dollars were rapidly covered throughout the day. Allowed to Say. According to foreign exchange experts no effort was being made at the moment on the American side to prevent the decline of sterling. It was held that the selling of sterling had been stimulated by official British purchases of francs. The present advance of the dollar over its maximum value, it was said, will be quickly stopped after the stabilization fund has been created through the revaluation of monetary gold stocks. If, as reported, sterling is to be held below a maximum of $5. the actual putting of the dollar down to 60c. will force the franc above 6.50 and bring the sterling-franc rate down to about 77 francs. This would mean large British purchases of francs, either official or for private speculative account, and if the former the conversion of the currency Into gold at the Bank of France. Opens Lower. Sterling opened yesterday morning below the $5 mark, the high for the day being $5.00%. The drop from the previous day followed a decline in London and also a sharp bidding up of gold in the open market there. The gold price had been raised from 1315. 6d. to 132s. 10d. Dispatches from London said that most of the gold offered again had been taken for American account. In New York the pound reached the low of $4.94% and closed at 14.9534 which compared with the previous rate of $5.04. The 90-day rate dropped from the premium of 354 to 254. Francs reached the low of 6.22 and closed at 6.2551, a drop from 6.32 at the close on the previous day. Forwards were strong and reached the premium of 434. against 4 on Wednesday. The New York "Evening Post" of yesterday (Jan. 19) summarized the day's foreign exchange fluctuations as follows: The dollar, pound and franc swiftly reversed their relative position in the foreign exchange market to-day after the fall of the pound and franc and the rise of the dollar yesterday. In the early trading abroad, the dollar fell 69 points, losing exactly all it had gained in the previous day. It opened at 61.99 cents but soon rallied and gained steadily to 62.63. The French franc advanced 7 points to 6.32 cents after having fallen to 6.23 at one time yesterday. It then fell back to 6.25, its closing level last night. Sterling jumped 84 cents to 5.04, restoring all its losses of yesterday, but soon reacted to 5.02. From so rapid a turnabout, it would seem that manipulation either by the British treasury or the Federal Reserve Bank of New York had taken place to restore prices and steady the market. Some dealers were inclined to believe that it was mostly owing to a normal rebound from the sharp declines of the pound and franc yesterday. pence. The price of gold in London remained unchanged at 132 shillings 10 but when this was converted at 5.04 to the pound as compared with 4.99 yesterday, it resulted in a rise of 35 cents to $33.49. Gold Stocks Distribution Shown by Treasury. The following Washington account, Jan. 15, is from the New York "Times": The distribution of gold stocks as of Dec. 31 1933, as compared with March 31, was shown by the Treasury to-day in the following table, the figures being in millions of dollars, and those for Dec. 31 subject to minor corrections: Federal Reserve SystemGold coin and bullion TreasuryGold coin and bullion in trust against gold certlneatee Reserve against U. S. notes (and Treasury notes of 1890) Held for Federal Reserve banks and agents All other money Total Outside Federal Reserve and Treasury Total monetary cold stock March 31 1933. Dec. 31 1933. Increase or Decrease. $711.6 $810.2 +198.6 1,308.3 1,159.2 -149.1 156.0 1,542.8 197.1 156.0 1,767.9 118.6 +225.1 -78.5 $3,204.2 366.5 $3,201.7 311.0 -$2.5 -55.5 24.282.3 $4,322.9 +$40.6 Revaluation Would Raise World Gold Dollar Value. From the New York "Times" of Jan. 16 we take the following: Revaluation of the dollar at 60% of its gold parity would mean an advance In the dollar value of the monetary gold stocks of the world from $12,300,000,000, the present approximate level at the dollar's old parity, to $20,500,000,000. It would yield a "profit" on the monetary gold stocks of the United States of $2,881,910,582, by lifting the book value of the gold stocks from $4,322,865,873, the level reported on Dec. 31, to $7,204,776,455. Not all of this "profit" would be available to the Government, however, because $310,970,642 of the country's gold stock consists of gold coin still ,Tan. 20 1934 held by the public, a part of which is thought to have been lost or sent abroad without record. The $4,011,895,231 of monetary gold held by the Treasury and the Federal Reserve banks would be equal, revalued on the basis of a 60% dollar, to $6,686,492,052, yielding a "profit" of $2,674,396,821 which would be available to use in setting up the new stabilization fund. Revaluation of the dollar at 50% of its old parity would double the dollar value of the monetary gold stocks of this country and the world. More Gold Returned by French Hoarders-End of High Premium Reverses Feeling of Those Saving Foreign Coin Instead of Bullion. Wireless advices, Jan. 13, from Paris to the New York "Times" said: The Bank of France for Jan. 5 shows a fresh increase of 142,000,000 francs in the gold reserve, making 295,000,000 in a fortnight. The increase is not ascribable to shipments from abroad nor to liberation of earmarked gold for foreign account. The gold which returned to the bank had previously been withdrawn for hoarding, but the anxiety concerning the future of the franc disappeared and hoarding, which had reached large proportions in France, now has ceased. The gold returned to the bank in the last fortnight was brought back in large amounts by private hoarders. There has, however, also been a reversal of feeling among private individuals who had hoarded foreign gold coin rather than bullion, because the high premium quoted in the period when it was in public demand no longer exists. Netherlands Bank Recalls Gold-Metal Earmarked Abroad Reduced to 9,801,788 Florins. A copyright cablegram, Jan. 14, from Amsterdam, Holland, to the New York "Times" said: The beginning of the new year witnessed a larger number of changes in figures of the Netherlands Bank than has been the case for some time. Among the most noticeable has been the calling in of gold lying earmarked abroad to the extent of 6,000,000 florins, thus reducing this amount to 9,801,788 florins. The total amount of the precious metal in the vaults of the home bank, or earmarked abroad, however, remains practically unchanged at just under 950,000,000 florins. Loans and overdrafts have dropped 6,000,000 to 142,660,448 florins, while credit balances on current account have increased from 205,789,945 florins to 914,666,410. With these general coverage has altered little while coverage of bank notes has gone up in gold from 98.2% to 100.9%, and in gold and silver combined from 101% to 103.7%. Decline in Transvaal Gold Output in 1933. The Transvaal gold output in December amounted to 894,156 ounces against 980,618 in December 1932, said a wireless message, Jan. 13,from London to the New York "Times," which added: In every month in 1933, except January, the output showed a decline from the corresponding month in 1932. Production for the whole year of 1933 was 11,017,495 ounces, compared with 11,553,564 in 1932, a decline of 536,069 ounces. The decrease is attributed to the treatment of lower-grade ore, which was made profitable by the high premium on gold. Increased Gold Production Chief Factor in Economic Recovery of South Africa. The gold mines of the Band may be the means of leading the Union of South Africa back to a more prosperous position, according to a report to the Commerce Department from Trade Commissioner E. B. Lawson, Johannesburg. With regard thereto, the Department, on Jan. 9, said: The prosperity of the gold mines at the present time, the report states, is of course due to conditions over which the country has no control, but for the moment the world's greatest gold producer is in a favored position and has taken advantage of almost one year's favorable conditions. The year 1933 was one of record gold production, it is pointed out. Average tonnage milled per munth during that period amounted to 2,994,230 tons as compared with 2,87'2,330 tons in 1932. Total working profit of the mining groups during the nine months ended September 1933 was £22,549,236, compared with 410,889,736 for the corresponding period of 1932. The more profitable conditions now existing as a result of the increased price of gold have resulted in the revival of old properties which have lain dormant for years and operations are now being carried out in many cases on a scale larger than at any previous time. Furthermore, established mines are re-working and marking off large reserves of hitherto little considered grades of ore. Non-producing mines have entered the field of producing and dividend-paying organizations. The most encouraging development of 1933, according to the report, was the extension of the life of the gold mines, resulting from the changed conditions, and the adoption of new policies such as the reduction of milling grade, the development of new areas, and the establishment of greater reserves. While it is not possible to state definitely the effect the increased price of gold may have on the life of the mines, as long as there is any appreciable premium received for gold, it will add to their normal life. Summing up the present status of the gold-mining industry in South Africa, Trade Commissioner Lawson declares that the increased activity of the mines and their added profits have been directly and indirectly reflected in the improved economic life of the country. The larger amounts distributed as dividends at the end of the first half of 1933 placed more money in circulation, stimulated business and assisted greatly in the restoration of confidence in the buying public. It is difficult, he concludes, to over-estimate the influence of the gold mines, the dependence which the Union places on them, and their importance in the economic recovery of South Africa. Senate Report Absolves Senator Overton of Louisiana But Says Election Situation in State Cannot Be Defended. The Special Committee on the Investigation of Campaign Expenditures, in a report to the Senate Jan. 16, did not Volume 138 Financial Chronicle question the right of Senator Overton of Louisiana to be seated, but did declare that the situation with regard to the elections in his State "cannot be defended." A Washington dispatch of Jan. 16 to the New York "Times" described the Senate debate, after the receipt of the report, in part as follows: The report led to a debate in which Senator Connally of Texas, the Chairman, defended the action of the Committee in spending the entire $25,000 appropriation in Louisiana alone. He also criticized John G. Holland, special investigator for the Committee, who was discharged after he called Senator Connally "yellow," saying Mr. Holland was suffering from "delusions of grandeur." "The situation in Louisiana as it relates to elections cannot be defended," the report stated. "The political organizations play the political game according to the standard that the result is the important thing and the means of obtaining it is a secondary consideration. There is probably no great difference in the methods of operation so far as the Old Regulars of the City of New Orleans and the Louisiana Democratic Association are concerned. "The Louisiana Democratic Association, generally known as the Long organization, absolutely dominated the politics of the State in 1932. and he himself directed the Overton campaign. Through the use of 'dummy' candidates, through the support of all State officers and employees, through a widespread and closely knit organization, the Long organization or machine controlled not only the primary election in which the Governor was nominated but also the election in September 1932." Walker D. Hines, Former Director-General of American Railroads, Dies in Italy—Had Acted as Mediator for Allies and Central Powers in Shipping Disputes. Walker Downer Hines, a leading American attorney who was Director-General of American Railroads from January 1919 until the roads were returned to private operation in May 1920, died in Merano,Italy, on Jan. 14 at the age of 63. Last June Mr. Hines went abroad at the head of a group of economic experts organized to co-operate with the Turkish Government in restoring prosperity in that country. A message from Memno to relatives in the United States said that Mr. Hines would be buried in Florence, Italy. The New York "Times" of Jan. 15, outlining his career, said in part: The appointment of Mr. Hines as Assistant Director of Railroads in February 1918 was regarded with general approval,for he was exceptionally well qualified for the task, having been familiar by theory and practice with transportation problems through twenty years of service with the Santa Fe Railroad, first as general counsel, finally as Chairman of the board. He helped William G. McAdoo organize the Railroad Administration on its wartime footing, and when Mr. McAdoo resigned in January 1919 Mr. Hines succeeded him as Director-General and remained at the head of the railroads until their return to private hands in May 1920. The next month he was chosen by President Wilson for another important post,of a different typo, but one that also gave value to his unfailing fairness and his extraordinarily impartial approach to questions submitted for his decision. The new appointment sent him to Paris as arbitrator of the disputes arising over the allocation of shipping on the international rivers of Europe as between our Allies and former enemy countries. He made his headquarters in Paris, with a branch office in Vienna. During fifteen months he rendered many decisions and every one of them was accepted by the countries affected. Returning to the United States in October 1921 he resumed the general practice of law in this city. Ile was Eastern counsel for the Great Northern Ry. and represented numerous other interests in important matters of railroad and corporation law. In 1925 he sacrificed his vacation to make a study for the League of Nations of the navigation situation on the Danube and the Rhino. House Passes Independent Offices Appropriation Bill Carrying 8566,000,000 — 84 Democrats Revolted Against Party Leaders at Previous Session on Issue of 5% Federal Pay Cut—Roosevelt Economy Rider Included in Measure. The House of Representatives, by a vote of 197 to 192, on Jan. 11 adopted a rule of procedure by which President Roosevelt's 5% Federal payroll readjustment will be carried through the House in all appropriation bills, despite demands for a larger increase or restoration of the entire 15% reduction provided by the Economy Act of 1933. The Democratic leaders in the House narrowly escaped defeat on the measure and 84 Democrats refused to vote in the affirmative. On the following day (Jan. 12), however, the Democratic revolt collapsed and the House passed the $566,000,000 Independent Offices Appropriation Bill by a vote of 240 to 141. More than half of the 84 Democrats who had deserted the Administration forces on the previous day followed the action of their leaders. On Jan. 12 a Washington dispatch of Jan. 11 to the New York "Herald Tribune" noted the debate and balloting on that day in part as follows: Two letters front the President were read by Representative James P. Buchanan, Democrat, of Texas, Chairman of the Appropriations Committee, to bear evidence of the President's earnest desire that the legislative rider to the Independent Office Appropriation Bill, first supply measure to roach the floor,should be adopted. It was a past which had been expected, but not until the Democratic leaders faced the prospect of being upset for the first time in the Seventy-third Congress, did it go over. "It was the stiffest step we will have," Representative Joseph W. Byrns, majority leader, said, "but it was hardly a measure of the Administration support because it was clouded by pay cuts and veterans. It was hardly fair to make such a fuss over the rule. It was devised for no other purpose than to make the pay readjustment uniform in all succeeding supply bills." 431 Automatic Promotions Suspended. When he spoke of uniformity, Mr. Byrns meant that the 5% pay increase and the compromise on the suspension of automatic promotions in the Army, Navy, Marine Corps and other services as proposed in the rider, would be the same in the other appropriation bills without opening up this controversial subject on each occasion. Chairman Buchanan was one of the group of 15 leaders of the Democratic majority, constituting a group of its Steering Committee, who called on the President early to-day to assure support of the Administration's program as it develops. The plight of the majority leaders developed rapidly as the debate,limited to three hours, wore on. The Republicans were in solid opposition to the rule procedure and willing to fight to open the whole payroll question. Democrats plainly were torn between allegiance to the President and the demands of their constituents for contrary action. Members indicated that their mails were flooded with demands for pay restoration and revision of the veterans' compensations. Representative John J. O'Connor, Democrat, of New York, replying to Representative Snell, accused the Republican leader of talking about the veterans to cajole "about 75 Democrats" to desert the Administration. On the vote, 84 Democrats did just what Representative O'Connor charged the Republicans were trying to get them to do. The President's letter on the service promotions follows: THE WHITE HOUSE. Washington, Jan. 10 1934. My dear Mr. Buchanan:—In my message transmitting to Congress the budget for the fiscal year ending June 30 1935, recommendation was made for the continuance during that fiscal year of certain economy legislative provisions. With regard to the continuance of the provision prohibiting automatic increases in compensation, recommendation was made that the Army, Navy and Marine Corps be exempted from the restrictions thereof, commencing with July 1 1934. Upon further consideration of this matter I feel that if the six services mentioned in the Pay Adjustment Act of 1922 are given privileges of promotion comparable to those conferred upon civilian employees it will place the entire Federal service on a more uniform basis. 4xisting law permits of the advancement of a civilian employee of a lower grade to fill a vacancy in a higher grade, with an increase of compensation of his rate of pay is less than the minimum provided for the higher grade. If the same principle be applied to the six services mentioned in the Pay Adjustment Act of 1922. I believe that such action would place all services On a more comparable basis and remove any of the inequalities. I hope the Congress will meet the legislative economy provisions referred to in my budget message as changed by the recommendation contained in Sincerely yours, this letter. FRANKLIN D. ROOSEVELT. Hon. James P. Buchanan, Chairman Appropriations Committee. House of Representatives. Letter on Continuing Cuts. The President's letter to Mr. Buchanan on the proposed readjustment follows: THE WHITE HOUSE. Washington, Jan. 9 1934. My dear Mr. Buchanan:—I am to-day signing an Executive Order which. in effect, maintains the 15% reduction in the compensation of officers and employees of the Government until June 30 1934. I have taken this action only after an exceedingly careful check-up by the Department of Labor in relation to the cost of living during the past six months. As you know, the Act of March 20 1933, authorizes me to restore a portion of the 15% reduction only if the index figures rise to or above 15% below the cost of living index for the base period. I have had two careful examinations made. The first of these relates to the general cost of living and shows that it is still 21.1 per centum below the index for the base period in the country as a whole. The other set of findings concerns the cost of living of Government employees in the District of Columbia. In this case the cost of living is 14.6% below the index for the base period. May I call your attention to the fact that all of these figures are based on data obtained by Government employees themselves, and that every effort has been made to arrive at the truth. I know, also, that you will realize that the overwhelming majority of Federal employees are scattered throughout the United States. In a few cities it is undoubtedly true that the present cost of living is slightly higher than the 15% reduction of pay warrants. It is necessary, nevertheless, under the law, to take the average, as there is no provision for picking out special localities for differences in rates. The action taken by me to-day will. I know, be of interest to your Committee in connection with the appropriation bills. I have recommended a flat restoration of 5%, or one-third of the 15% reduction, this restoration to apply to the next fiscal year. I have asked also for authority to restore such portion of the balance of 10% as may be warranted by a possible further increase in the cost of living. I hope that your Committee will go along with these suggestions. The problem of returning as quickly as possible to a balanced budget is involved. To undo the excellent results of the Economy Act of last spring would be unfortunate for the very simple reason that we are very definitely still in an emergency period, in which all of us are seeking to bring back recovery as quickly as possible. I shall, of course, be glad to talk with you and the members of your Committee at any time. Very sincerely yours, FRANKLIN D. ROOSEVELT. Hon. James P. Buchanan, House of Representatives, Washington, D.c. Washington advices of Jan. 12 to the "Herald Tribune" outlined the action of the House on that day in part as follows: The vote of 240 to 141 by which the House disposed of a motion to recommit the measure to make way for final passage showed more than half the 84 Democrats who flouted their leaders yesterday back on the reservation. Fewer Republicans also engaged in the scramble to-day to delay the bill which carries a legislative rider freezing the President's payroll plan in all appropriation bills still to be submitted to the House. Fight Due in Senate. The vote found only 41 Democrats lined up with 95 Republicans and five faithful Farmer-Labor members in favor of a motion of Representative Edward W.Goss, Republican, of Connecticut, to recommit the bill on what he virtually said was "general principles." The opposition consisted of 239 Democrats and one Republican, Schuyler Merritt, of Connecticut. Representatives Hamilton Fish, Jr., of New York,and Harold McGuigin. of Kansas, both Republicans, voted present after their veterans' pension Financial Chronicle 432 increase proposals were defeated by division votes. Mr. Fish had sought to restore $41,000,000 for disabled World War veterans. The McGuigin proposal was to increase the veterans item in the bill by $46,000,000 by advances in the pensions of veterans of the Spanish-American War. The measure, first of the supply bills of the present Congress, will go to the Senate, where the fight over payroll and veterans' compensation doubtlessiwill be resumed. Senators also may have something to say of the House economy rider. Is The House defeated the Fish amendment by a vote of 154 to 59 and the McGulgin proposal by 151 to 72. It also rejected an amendment by Representative Carl E. Mapes, Republican, of Michigan, to increase the veterans' item $100,000,000. Votes for Recommitment. pr The payroll rider provides a restoration on July 1 of one-third of the 15% pay cut of the economy Act, predicated upon the President's study of the cost of living, and for certain adjustments in pay of Army. Navy and other service officers when automatically promoted. New York Emergency Banking Act Declared Unconstitutional by State Supreme Court—Appellate Division Holds Delegation of Legislative Rights Illegal—Also Cites Failure of Legislature to Fix Time Limit, The Appellate Division of the New York Supreme Court ruled on Jan. 12 that the emergency Act passed by the State Legislature during the suspension of banking business in March 1933 is unconstitutional. The Act had given the State Banking Board the right to suspend operation of the banking laws until the emergency was declared terminated. The Court's ruling was based on the ground that no definite date was fixed for the ending of the emergency, and that the Act delegated legislative authority to the State Banking Department. The ruling affects a group of mortgage investment companies which have been under the control of Superintendent of Banks Joseph A. Broderick, and which have benefited from the emergency legislation. A lower court upheld the constitutionality of the Act in a suit instituted by Frank Moses and James T. Berney, acting as trustees of the estate of Benjamin Adriance, against the Guaranteed Mortgage Co. of New York, in which the recovery of $72,500 in guaranteed mortgages was sought. These mortgages had been purchased from the defendant and were conceded to be payable because the 18 months' grace provided by the guarantee had expired and the defendant's liability was absolute. The New York "Times" of Jan. 13 commented on the ruling in part as follows: Justice Edward J. Glennon, writing the unanimous opinion of the Appellate Division, said the first defense asserted that the regulation was issued by the State Banking Department, the Banking,Board of the State of New York and Superintendent Broderick, "acting pursuant to Presidential proclamations, Executive Orders and interpretations of the Treasury Department of the United States, and also to the power and authority vested in them by the Banking Law of the State of New York." The second defense reiterated the allegations of the first, and also recited that "an emergency existed and still exists in the State of New York,affecting the health, comfort and safety of the people; that the Legislature of the State has upon several occasions declared in its enactments that an emergency exists." and that on March 7 last the Legislature passed an emergency measure known as Chapter 41 of the Laws of 1933. The law provided that during the period of the emergency the Banking Board, by a two-thirds vote, could "suspend any provision of the banking law in whole or in part." and any of its regulations "shall supersede any provision of the law inconsistent therewith." Section 5 of the Act reads: "The period of the emergency herein provided for shall be from the date of the taking effect of this Act until such date as the Legislature may, by joint resolution, designate to be the termination thereof, or if the Legislature be not in session, the date so designated by a proclamation of the Governor." The plaintiffs attacked both defenses, and on the ground that they were insufficient, asked summary judgment for the sum involved. The lower court denied the application, but the Appellate Division reversed the ruling and granted judgment. Justice Glennon's opinion said the constitutionality of the law was attacked on the ground that legislative functions were improperly delegated to the Banking Board, and that "the statute is so indefinite as to time as to impair the rights and obligations of existing contracts." "While we realize the stress of circumstances and the conditions which prevailed at the time of the proclamations of the President, of the Governor of this State and of the Treasury Department's interpretations, as well as of the enactment of Chapter 41 of the Laws of 1933, still it is our duty to determine whether or not the constitutional rights of these plaintiffs have been violated," said Justice Glennon. The Court pointed out that "there is embodied in the Constitution of this State the sound principle that the Legislature may not delegate to au administrative board or officer powers which are inherently and exclusively legislative." Holds Power Was Delegated. Justice Glennon cited the provisions of the law and said: thus conferred amounts to authority to make law. "The "The Legislature has merely announced a general policy with regard to the inst tutions affected, and has granted to the Banking Board the power to make such laws which In its judgment are necessary during the . We think this is a deleemergency to carry out that policy. . gation of legislative authority.' the statute is too indefinite as to time, As to the second assertion that Justice Glennon said: "No one would quarrel with the right of the Legislature to suspend the payment of principal on mortgages such as are involved in this case for a dnite period of time." But he pointed out that the emergency is to continue until declared terminated by the Legislature or the Governor,and continued: "Under the terms of this provision nobody can tell with any degree of certainty when the joint resolution may be passed, or when the Governor, If the Legislature is not in session, may issue a proclamation declaring the ier Jan, 20 1934 emergency at an end. Thus the existing legal rights of plaintiffs may be totally destroyed, and they appear to have no definite remedy. The rights and obligations of contracts are thus impaired. It will be noted that in the mortgage moratorium laws the suspension of remedies was for a definite period of time. Here it is indefinite. "Defendant attempts to sustain the statute upon the broad ground that, In view of the grave emergency which has been proclaimed to exist in the State and in the Nation, it is the proper exercise of police power. We do not doubt that the Legislature may enact a law which will control the situation, but we must hold, for the reasons stated, that the statute in its present form is unconstitutional." James P. Warburg of Bank of Manhattan Co. at Hearing Before House Committee on Monetary Bill to Devalue Dollar Expresses Belief We Are Started in "Right Direction"—Advocated Equalization Fund Last March and Has Always Felt Profit from Devaluation Should Go to Government—Hopes for "Modernized Gold Standard." Before the House Committee on Coinage, Weights and Measures, on Jan. 18, James P. Warburg, Monetary Adviser to the American delegation at the World Monetary and Economic Conference held at London, submitted his views on President Roosevelt's monetary proposals, devaluation of the dollar and the taking over of the gold holdings of the Federal Reserve banks. Mr. Warburg noted that "in his monetary message to Congress four days ago, The President made three major recommendations; that all monetary gold be taken over by the Treasury; that the limits of devaluation be fixed between 50% and 60% of the old dollar, and that a large part of the profit due to revaluation be set aside as a fund to stabilize the dollar and the National credit." Mr. Warburg went on to say "I advocated an equalization fund as early as last March. I have always felt that any profit from devaluation should go to the Government. At the hearing before the Committee Mr. Warburg submitted documents embodying "concrete suggestions" which he said, "I should like to make to the Committee in regard to the modernized gold standard that I think would best suit our requirements." Peferring to the President's message, Mr. Warburg said: am still in doubt, after reading the message, whether the President Intends ultimately to return to a fixed gold content or not. Ile has again used language which may easily, though not necessarily, mean a modernized gold standard, rather than a dollar of variable gold content. I deeply hope that it does. While in favor of the Government taking the profit from devaluation of the gold now in the Federal Reserve banks, Mr. Warburg, it was indicated in a Washington dispatch to the New York "Times" does not approve taking over the gold. We also quote further as follows from the same dispatch: Mr. Warburg told the Coinage. Weights and Measures Committee that while he differed with some details of the President's plan, and with the different "schools of thought" regarding monetary matters, "I would be for the bill purely on the grounds of supporting the President." He was the only witness heard in open session to-day; it had been almost to his statement. 5 p.m. before the committee assembled to listen Some of the Committee members had believed that the hearings were of the gold legislation passage recommending concluded, because a report was sent to the House yesterday and privileged status was given for its consideration on Saturday. Mr. Warburg, questioned by the Committee, appeared to have considerable difficulty in making some members realize the difference between "devalue" and "depreciate," and he repeated time after time that devaluation did not mean depreciation. Remarking that at the present rate of exchange the American dollar was worth about 60 cents, he declared that if it was devalued below that, depreciation would begin. He added that he did not believe in the theory of raising prices by depreciation "because that does not raise wages or incomes." "The President has chosen this view," he said in approving the stabilization section of the proposal. "I don't know what his reasons were, I have Presented my side and he has gone the other way," Sees Contest Between Funds. Asked by Representative Feisinger if the proposed $2,000,000,000 stabilization fund requested by President Roosevelt would not lead to a race with England, Mr. Warburg replied: "It is going to be a competitive race when the fund is established, yes." Mr. Warburg said that because the greater part of our money was deposit money, the banking problem was closely related to the gold discussion. He also discussed the different "schools of thought" and enumerated his objections to their recent testimony. . . If the United States had had an equalization or stabilization fund, he said, "we would have been better off after England went off the gold standard." Would Not Limit Fund on Time. Representative McGugin suggested that the life of the stabilization fund be limited, probably to one year to start, but Mr. WaOurg said another way would be to give the President authority to end the fund when a fixed stabilization had been agreed upon by most of the gold nations. He thought the life of the fund should no more be fixed by law than a Navy ship's operation should be limited to a certain time. "Limit it to its purpose to offset conditions." he suggested. He said that we could not stabilize our currency intelligently until we knew what Great Britain would do, nor could Great Britain do so until they knew what we should do. Replying to a question, he said: "We can run up a much bigger National debt with confidence in our currency than if we didn't have confidence." Volume 138 Financial Chronicle Representative Feisinger told Mr. Warburg that "I am just a poor Congressman from the sticks. I would like to know what you would do, how you would vote, if you were a member of the Committee." It was then that Mr. Warburg replied he would support the bill purely on the grounds of supporting the President. "You are arming the President to defend this country against foreign invasion," he added. He steadily declined to admit, especially to Mr. Feisinger, ardent silver advocate, that England was trying to reduce its own currency to obtain more world trade. Mr. Warburg said that such National action would not affect world prices, and he believed no nation would deliberately "cut its own throat" to get such trade. He said that where cheap money prevailed in one country, its people would have to pay more for imports and sell for less. Mr. Warburg's statement before the Committee follows: Your Chairman has asked me to prepare for you a discussion of the best move that the United States could make to end dislocations in the monetary systems. I understand that there have appeared before you during the last few days Dr. Sprague, Dr. James, Mr. Vanderlip, Father Coughlin and Professor Fisher. I am, I think, fairly familiar with the views of all of these gentlemen. In five published documents, dated Nov. 22 1933, Nov. 27 1933. Dec. 1 1933, Dec. 20 1933 and Jan. 111934, I have set forth rather fully my own views in regard to the monetary question. I have spent printed copies of each of these five documents to every member of both Houses of Congress. Not knowing how many of you gentlemen have done me the honor to peruse these papers, and being desirous of wasting as little of the Committee's time as possible, I am somewhat at a loss whether to repeat briefly what I have previously said or to proceed from the assumption that the gentlemen of this Committee have been good enough to examine the documents I have sent them. I have therefore prepared a condensed version for the Committee, which, if it is your wish, I shall read to you, or which, if you prefer, I shall place on the record so that you can proceed at once to ask me any questions that you may desire. I have not included in this condensation such statements as I have made concerning the banking and investment business, because I assume that those two problems lie outside the scope of your present inquiry. I must stress, however, that as the greatest part of our money is deposit money— that is, check money—the banking problem is closely related to this discussion. Similarly, I have not touched upon the question of the budget and the present program of government expenditure. but I desire to emphasize that the soundest monetary policy can and will be rendered void by an unsound budget policy. I am not prepared to say how much we can afford to spend. A great deal depends upon the manner of spending it. I am prepared to say, however, that if we spend more than we can ultimately pay for out of taxation, we shall have paper money, in spite of any present resolve to the contrary. Whether we can accomplish our purpose without paper money depends upon whether we can sell a huge amount of government bonds now, and later retire them; and whether we can sell government bonds now depends in large measure on the removal of uncertainty in regard to the currency. I' present herewith the condensed statement, to which I have referred, and await your pleasure. Before proceeding to deal with it as you may direct, may I make the following general statement? It seems to me that we have two major problems, and in regard to each of these two major problems we have, generally speaking, two major schools of thought. The two problems are: First. The relation of a monetary system to the general economic system which means the relation of a monetary system to a depression, or to the recovery from a depression, and Second. The kind of a monetary system that seems most desirable and adaptable to our needs. In regard to the first problem, there is one school which says that the breakdown of the monetary system lies at the root of the whole economic depression. This school, to which Professor Fisher and Professor Warren belong, and to which Mr. Vanderlip belongs also—in a slightly modified degree—contends that since money was the primary cause of the depression, money must also be the primary means to recovery. The other school, to which Professor Sprague and Dr. James belong, and to which I also subscribe, holds that a depression is a complicated economic phenomenon and that recovery cannot be sought by anything so simple as a change in the monetary system. Furthermore, this school holds that whereas the breakdown of the monetary system undoubtedly added to the severity of the depression, the breakdown of the monetary system was in itself a result of the depression and not its primary cause. My own reason for adhering to this belief is that I am convinced that the present depression arose primarily from the enormous expenditures for non-productive purposes which were brought about by the War. I believe that the dislocation of production, consumption, labor, and working capital was the consequence of millions of people changing over from their normal peace-time occupations into war-time occupations and, after the War, changing back again. I believe that all this placed a strain upon the monetary system which that system was unable to support, and that when the monetary system gave way it added to the existing confusion. It does not follow from this statement that I believe the monetary system which we had before the War should be the system to which we now seek a return. On the contrary, I believe that from the lessons of the last 20 years we can learn much which will help us to improve our money mechanism, and I have set forth in the documents to which I have referred what I believe some of these improvements might be. When Professor Fisher says that there are only a handful of people who understand the mystery of money and that all our troubles have been due to the misunderstood "money illusion," he means, in effect, as you will doubtless have seen from his testimony, that prices expressed in money are the fundamental factor, and that cyclical booms and depressions could be avoided if we had a money with stable purchasing power, or—inversely expressed—if we had a stable price level. Neither Professor Fisher nor Professor Warren, nor any of the small select group that profess to understand the mystery of money, offer any real proof of this contention. They do not, for instance, explain how we were able to store up such a vast quantity of trouble for ourselves in the period of 1923-1929, in spite of the fact that during that period we had, practically speaking, a stable price level. It is not pleasant to attack so eminent an authority as Professor Fisher by the means which I used in my address before the American Academy of Political Science, but, when an eminent authority makes a series of categorical assertions without offering proof, and merely states that those who disagree are ignorant and uninitiated into the mysteries, it is necessary to examine how true previous similar assertions of such an authority have shown themselves to be. I therefore felt justified in quoting a series of assertions made by Professor Fisher in 1929. which, in the light of 433 subsequent developments, do not lead one to take his present day pro,ed nouncements too seriously. I am not an economist and I do not hold myself out as an authority on refuauthentic desire these matters. If the gentlemen of this Committee tation of the Fisher-Warren-Vanderlip school of thought. I would refer them to some very excellent short articles written by Professor Rufus Tucker, Professor Walter Spahr, Professor Edwin Kemmerer and Dr. George Roberts. Now, as to the second problem, namely, what kind of a monetary standard we should seek to establish. It follows quite naturally that the two schools of thought would seek a different mechanism, because they each have a different conception of what that mechanism is trying to accomplish. The Fisher-Warren school, to which Mr. Vanderlip formerly belonged, but which he has recently more or less deserted in favor of a position considerably nearer to my own, desires a dollar of variable gold content. While Professor Sprague, Professor James and I can see neither the necessity for, nor the practicability of such a suggestion. Your other witness, Rev. Charles E. Coughlin, belongs, so far as I can ascertain, to neither school. I have carefully studied his monetary' proposals in a recent magazine article as well as the printed copies of his broadcasts. This study recently led me to address an open letter to Father Coughlin, which is the last of the five documents to which I have previously referred. After hearing him answer this letter over the radio last Sunday I still believe that Father Coughlin's proposal is based upon a number of fundamental misconceptions. Apart from the theoretical merits or demerits of the Fisher-Warren commodity dollar idea, I do not believe in its practical value, because it presupposes that the same human beings, who failed to manage the comparatively simple mechanism of the gold standard, will be able successfully to manage a very much more complicated mechanism. Furthermore, no one knows better than the gentlemen of this Committee what happens to a highly technical and precise proposal when it is put through the Congressional machinery and turned into legislation, and none knows better than the gentlemen of this Committee the pressure to which Governmental authorities are always subject from vociferous groups and special interest minorities. It is always difficult for a government or a central bank to apply the brakes in times of over-expansion. It is always unpopular to attempt to check a boom,and as long as booms are unchecked we shall always have depressions to follow them. Think of the additional pressure that can be put upon those who would have to regulate, under the Fisher-Warren plan, not only the increase or decrease of the gold content of the dollar, but the selection of the commodities that are to compose the index, and the relative weighting of these commodities. referred, I have set forth in detail, in the documents to which I have make to the Committee in the concrete suggestions that I should like to regard to the type of modernized gold standard that I think would best Vanderlip suit our requirements. With some of these proposals Mr. re-establishagrees. He has recently publicly expressed adherence to the ment of a modernized gold standard, as opposed to the adoption of a dollar associates on of variable gold content, which is advocated by his former the Committee for the Nation. summer, "a dollar of last President Whereas the phrase used by the of constant purchasing and debt-paying power" seemed to imply a dollar message variable gold content. I think it is important to note that in his such in opening Congress he used words which do not necessarily imply any thing. These words were. "a medium of exchange which will have over people the years less variable purchasing and debt-paying power for our I than that of the past." These words represent a purpose with which modernized gold can and do declare myself in thorough sympathy. A of medium us a standard such as I have proposed would, I believe, give years— exchange whose purchasing power would vary less over a period of considerably less—than under the old pre-war gold standard. In his monetary message to Congress four days ago the President made over by three major recommendations: that all monetary gold be taken the Treasury; that the limits of revaluation be fixed between 50% and 60% of the old dollar; and that a large part of the profit due to revaluation be set aside as a fund to stabilize the dollar and the national credit. I advocated an equalization fund as early as last March. I have always felt that any profit from devaluation should go to the Government. ' When I returned from London at the end of July, I made a written report in which I stated, "The entire recovery program is jeopardized by uncertainty and doubt in the monetary field," and recommended, among other things: than October That the United States Government should desire not later to bring about the first to fix the amount of devaluation desired, in order necessary adjustment of the price level, allowing for a subsequent variation of not over 10%. That is exactly what is now proposed. In July the range would have been 65% to 75%, instead of 50% to 60%. I thought then that a 30% devaluation would be sufficient. and I still think that a devaluation of 40%50% may work some injustice, and may store up future trouble, but I bow to the judgment of the President. He has listened to all sides, and weighed his decision with the greatest care. In any case I welcome the removal of the two extremes of uncertainty. I am still in some doubt, after reading the message, whether the President intends ultimately to return to a fixed gold content or not. He has again used language which may easily though not necessarily, mean a modernized gold standard, rather than a dollar of variable gold content. I deeply hope that it does. There are still many dangers that beset our course. Some of them I have indicated. Others I prefer not to indicate, because I do not believe in looking for trouble, or in raising doubts, when I do not know all the factors that have been considered. I feel, however,that we are now started in the right direction, away from uncertainty and towards a goal which will in time become definite, where to-day it is still somewhat enshrouded in mist. And I am profoundly convinced that, if you gentlemen will carefully analyze the experience of the Past—if you will build upon that experience a monetary mechanism to carry out the President's high purpose—rather than starting out upon an entirely new conception of what money is, what money means, and what money can reasonably be expected to do, you will perform a service for which future generations will thank you—as I thank you now for this opportunity to present my views. From a supplementary statement submitted by Mr. Warburg we also quote the following: III. Additional Note on Silver for the Committee. It seems to me that silver has three aspects. It is a commodity. It is a medium of exchange. It is a basicirmonetary metal. As a commodity it has been depressed by arbitrary curtailment of demand by governmental actions.• The proposed international, agreement will *Debasement of subsidiary coinages and putting India on a gold basis, thereby releasing her Treasury stocks of silver. 434 Financial Chronicle seek to offset this by curtailing supply, and possibly will increase the demand, if subsidiary coinages are gradually remonetized. As a medium of exchange it has the same relative importance as any foreign exchange unit, that is, its stability or instability affect the world economy much as the stability or instability of the pound or dollar or florin affect it. In the silver countries it affects the internal economies of those countries, much as the dollar affects our economy, although some economies are much more sensitive than others. As a basic monetary metal it takes the place of gold in some countries. Is used alongside of gold in others, and in still others is used only in subsidiary coinage or not at all. From the point of view of this inquiry: 1. As a commodity, it would seem that silver has recently received all the government help It can reasonably expect, as compared to other commodities. 2. As a medium of exchange, it would seem desirable that silver should be prevented from fluctuating excessively, just as it is desirable to prevent excessive fluctuations of the pound or franc or dollar. 3. It is claimed that silver should be stabilized at a considerably higher price than it enjoys at present, "because this would increase the purchasing to raise Power of the silver countries." Why should it be good for China her unit's value, if it is good for the United States to depreciate its dollar? If the gold countries want higher price levels, why should the silver countries want lower price levels? (Assuming that price levels can be raised or lowered in that way.) I have no opinion on what the right price would be. 4. As a basic monetary metal: a. It seems desirable to remonetize subsidiary coinages, provided the respective countries can make funds available under their budgets to buy the necessary silver. b. There is only one real argument for bimetallism or symmetalism, and that is based upon a shortage of monetary gold. If the economies in the use of gold, which I have suggested, are adopted. I do not believe there would be any shortage of gold. 5. Those who argue for silver money because they want cheaper money might just as well argue for copper money, or iron money, or paper money. James P. Warburg of Bank of Manhattan Co. Replies to Radio Address of Rev. Charles E. Coughlin— Mr. Warburg Declares He Is Not a Spokesman for Wall Street or Any Group—Contends Father Coughlin's Currency Proposal Is Open to Basic Misunderstanding. Several exchanges of views regarding the Administration's currency proposals have recently passed between James P. Warburg and the Rev. Charles E. Coughlin of Detroit. The latest of these is in the form of a reply by Mr. Warburg to an address broadcast by Father Coughlin from Detroit on Jan. 14. Mr. Warburg's reply follows: Jan. 16 1934. Reverend and dear Sir: letter I listened to your broadcast Sunday in which you replied to my open I of the 11th. You say that I cannot hope to convert you. Nevertheless, shall reply briefly to what you said on Sunday. disour of First let me say a word about what you call the philosophy agreement. While I appreciate your giving me a good character as an individual, and treating me as a respectable enemy, I must flatly repudiate the inherited philosophy which you attribute to me, because upon this assumed inheritance you seek to discredit sue with your listeners. You are under several mis- apprehensions. I am not one who wants to see the classes benefit at the expense of the masses. I am not a spokesman for Wall Street nor for any group. it is true that I was an officer of the International Acceptance Bank, which you say was "closely connected with the war." My dear sir, the International Acceptance Bank was only founded in 1921. From 1914 to 1918 my father, Paul M. Warburg, who was its founder, was in the service of the Government. From 1918 to 1921 he was not in business at all. Nor have I—as you state—opposed the revaluation of gold, as you can easily see from my published correspondence with Senator Borah. As a matter of fact, I advocated in writing as early as last July, when I returned from London, that an upper and lower limit of revaluation, 10 points apart, be fixed as soon as possible. That is what the President is now urging Congress to do. Nor did I try to bring about stabilization last June "against the wishes of the President." I tried to persuade the President what I thought would be best—not for bankers—but for the country. That was my duty as an adviser. When I failed to persuade him after months of effort, I withdrew, because by usefulness was at an end. And when I withdrew I stated (but you did not quote that passage of my Philadelphia speech) "that I admired the President for his courage and his desire to create a better state ; that I loved him for his kindness, his humor and his faith; and that what I must reluctantly oppose were some of the misconceptions that seemed to me to becloud his purpose, as well as the complete disregard of the experience of the past on the part of too many of his advisers." I do not oppose the President. No one wants more to see him succeed that I. I do oppose those who advocate what I consider policies that will hinder him in the accomplishment of his'purpose. It is very easy to appeal to certain natural feelings in people. Since the world began a creditor has been a target of abuse. A man who has nothing and owes nothing and who barely earns a living is very slow to realize that he himself is a creditor; yet he and others like him are the backbone of the creditor class. Too often they realize it only after they have been destroyed. Do you really believe the war was started by bankers? Do you really believe that bankers pushed the Government into selling the "bloody bonds"? Don't you remember the hysteria after the sinking of the Lusitania, the sabotage of the Germans and the propaganda of the Allies? Dou't you remember how every bank, and every corporation, and every individual was urged by the Government to be patriotic—to invest every available cent in Liberty bonds? And don't you realize where those bonds are held to-day, and why? Certainly a lot of them are in the banks because they are considered not the most profitable, but the best and safest assets a bank can hold against its liability to its depositors. Banks do not hold Government bonds to make money for their stockholders. A lot more of the "bloody bonds" are held by savings banks and life insurance companies. Most of these are mutual companies and represent solely the interests of some 67,000,000 policies and sonic 44,000,000 savings accounts. These are the masses, not the classes. Jan. 20 1934 own And finally, there are some rich corporations and individuals that whose "bloody bonds," but there are also the thousands of small investors life savings are in these securities. When you attack the holders of "bloody bonds" you are not attacking the "racketeering banksters," you are attacking the whole American people. Do you not see that? And when you say that there are only some $46 of currency per capita in the country, and talk about a famine of money—what about bank deposits, savings accounts, and marketable securities? We have no famine of money— we have a maldistribution of wealth. (And, if you quote that sentence, please quote it all.) Making two dollars out of one dollar will not cure the inaldistribution of wealth. It will not enrich the poor any more than calling six inches a foot will make you any taller. You will be 12 feet high instead of six, but you will not be able to reach what is out of your reach now. Do you not see that also? You will not believe me when I say that I want the greatest good for the greatest number just as much as you do. But, because I honestly admire your talent as a leader of public opinion, I shall not give up asking you to see some of the basic things I am convinced you do not see, and that I think you are big enough to recignoze, if you do see them. As to your currency proposal. It now appears that you have in mind two kinds of currency; one consisting of Treasury notes, to be issued up to an amount equal to two and a half times the Treasury's gold, gold being revalued at $41.34; and the other, your symmetallic currency, issued against 25% of gold at $41.34 per ounce and 75% of silver at $1 per ounce. Is this correct? The fact that your proposal was open to so basic a misunderstanding seems was into me to prove my contention, that it was not clear and that it complete. of I understand further that you now propose to pay off $10,000,000,000 "bloody bonds" by issuing the first kind of currency, although you spoke ordiof paying them off with non-interest bearing Treasury notes, which narily mean unsecured Treasury paper. In addition, you propose the issuance of $5,000,000,000 of this currency through public works or other expenditure. your symThen you propose an auxiliary currency issued on the basis of metallic proposal. You were vague as to figures, but I gathered you meant in an amount of about $5,000,000,000. Then you propose to leave outstanding in its present form the $5,000,000,000 of circulation which is now outstanding. Do you realize what this means? We have outstanding now six kinds of paper money—Federal Reserve notes, Federal Reserve bank notes, National bank notes, greenbacks, silver certificates and hoarded gold certificates. That is bad enough! Our currency system as a whole does not represent a plan, but the left-over remnants of many plans. You now propose to add two more kinds of currency, $15,000,000,000 of Treasury notes, secured 40% by revalued gold and 60% by nothing, and $5,000,000,000 of your gymmetallic currency. But, perhaps I have misunderstood you again. Very respectfully, JAMES P. WARBURG. Rev. Charles E. Coughlin, P. 0. Box 150, Detroit, Mich. An Associated Press account from Detroit, Jan. 14,' of Father Coughlin's remarks is taken as follows from the New York "Herald Tribune": The Rev. Charles E. Coughlin to-day declared that, by revaluing and nationalizing gold and restoring silver, there is enough precious metal upon which to base 25,000,000,000 currency dollars, and urged his audience to write their Representatives in Congress demanding support of that program. His subject was "A Reply to Mr. Warburg," and dealt mostly with an open letter to Father Coughlin made public last week by James P. Warburg, who was economic adviser to the American delegation at the London Economic Conference. Father Coughlin's address was broadcast over an independent hook-up of radio Fa Course Legal Since 1914. Mr. Warburg, described by Father Coughlin as a banker "of high repute," who "claims to favor a modernized gold standard," had said, in his letter, that "there is not enough gold and silver obtainable in the world" to carry out Father Coughlin's proposal for the issuance of $19,000,000,000 of war bonds with currency, "unless the currency so issued is unsecured printing press currency." Father Coughlin commented that Mr. Warburg's plan for "modernization does not imply revaluation." He said that by revaluing the $4,500,000,000 worth of gold in the United States at $8,500,000,000, pricing silver at $1 an ounce, instead of 44c., nationalizing both, it would be possible, under the Federal Reserve law, to issue 25,000,000,000 currency dollars. He pointed out that since 1914 it has been legal to issue two and a half times as many currency dollars as there are gold dollars. He proposed that of this $25,000,000,000 in currency, $10,000,000,000 be used for retirement of war bonds, holders of which, he said, "Now wax rich at the expense of widows of soldiers." He said he did not suggest seizing and destroying the war bonds, as, he said, Mussolini had done, but paying "with Treasury notes, non-interestbearing. for the interest-bearing bonds." Of Mr. Warburg's statement that Father Coughlin's currency proposal "is Incomplete and not clear," the speaker said his suggestion of a currency system based upon both gold and silver apparently had been misunderstood. He said his suggestion of "syrnmetallism," or utilizing both gold and silver, did not contemplate that silver be used alone at any time. "It would be used as real money only when wedded to gold," he said, "for fear of driving gold from the country." IVarburg's Views Assailed. Father Coughlin said he hoped that 10,000,000 persons would write to their Senators or Representatives demanding enactment of his program and declared that success would "make America a land of financial independence." He compared the present fight to the Revolution of 1776, "when a hand of patriots dared to stand against foreign tyrants," and predicted that "the pen will prove mightier than the sword." Of Mr. Warburg he said: "The blood of international bankers flows in his veins," and that he believes "bonds, even 'bloody bonds,' to be the bread of bankers." Mr. Warburg, he said, now is Vice-President of the Bank of the Manhattan Trust Co., and formerly was an officer of the International Acceptance Bank, which, he said, "was directly connected with the Warld War." He said the banker considers President Roosevelt's "commodity dollar" a "moonbeam, and a fantastic dream." By revaluing gold, he explained, this country could purchase $1,000,000,000 ounces of silver, "and shortly we would possess 1,800,000,000 ounces Volume 138 Financial Chronicle of siber, worth $1,800,000,000." This, added to the nationalized gold, revalued at $8,500,000,000, he said, would make it possible to issue 25,000,000,000 currency dollars. On Jan. 11 Mr. Warburg stated that Father Coughlin's proposal for the substitution of "symmetallism" for gold as a monetary standard and for the redemption of Government bonds in currency would not work, because there is not enough gold and silver in the world to make it work, even if both metals were revalued at any cenceivable rate. The foregoing is from the New York "Times" of Jan. 12, from which the following is also taken: Mr. Warburg, who resigned as an adviser to President Roosevelt last year and has devoted himself since to advocacy of sound money principles through return to "a modernized gold standard," made public an open letter to Father Coughlin. The banker replied to statements made by the priest in an article in last week's issue of the magazine "To-day," and in his radio address last Sunday. In his magazine article, Father Coughlin, after asserting his advocacy of symmetallism, defined it as "using gold and silver together in one coin." The coinage would not be used in circulation, but paper money would be printed against it. "The paper money," Father Coughlin added, "will be backed by real gold to the value of 25e. and real silver to the value of 75c." Says Plan Is Incomplete. Besides calling for more gold and silver than the world possesses, Mr. Warburg replied, the priest's currency plan was "incomplete and not clear." The banker also criticized Father Coughlin's bond redemption proposal on the ground that there was no way by which the Government could retire its funded debt with currency except through printing press inflation or the confiscation of private property. Mr. Warburg declared he did not believe Father Coughlin had "fully realized the complexities of the money problem." He expressed his own belief in "intelligent reform" of the economic machine wherever it has broken down, "either through its own inadequacy or abuse." Friends of Mr. Warburg related an anecdote concerning Father Coughlin's radio talks. Last Sunday afternoon Mr. Warburg hailed a radio-equipped taxicab and gave the driver his address. "Naw, I can't take you anywhere now, buddy," said the driver. "I gotta lissen to this on the radio." Mr. Warburg got into the cab, nevertheless, and listened with the driver to the end of Father C,oughlin's speech. When it was over, the driver took him where he wanted to go. Mr. IVarburea Letter. Mr. Warburg's letter to Father Coughlin follows: Reverend and dear Sir: For some time I have been following your radio speeches on monetary affairs, and I have read your article, "Inflation and Silver," in a recent issue of "To-day." Although you have publicly attacked me on various occasions and implied that the position I have taken on monetary matters is motivated by selfinterest, I am not concerned here with the refutation of any personal charges or insinuations. You do not know me, and I have not the prilivege of knowing you. But, because you are the servant of an institution which stands for social justice, I feel warranted in assuming that your utterances are based upon the conviction that the policies you advocate will promote social justice. Nor do I question the sincerity of your conviction. Whether I am honest or dishonest, self-interested or public-spirited, is not the question at issue. What is important—because of the millions of people who listen to you—is whether much of what you advocate so persuasively will not add to the existing social injustice. I refer particularly to two proposals you have made: In your broadcasts you have frequently attacked the outstanding bonds of our Government, which were sold to finance the cost of the war, as "bloody bonds," sold to finance a war etigineered by banks and special interests. You picture these bonds as now being held by the "mighty banks," drawing interest at the expense of the innocent taxpayers, and further enriching the bankers. You have proposed that, in the interests of justice, these bonds should be paid off in currency, so the banks would cease to draw interest from the taxpayer. Supply of Metal Questioned. In your article in "To-day" you advocate symmetallism, "which means," in your own words, "using gold and silver together—not separate—in one coin. In this coin, which we call a dollar, there Will be 25 cents worth of gold and 75 cents worth of silver. Of course this coin will not be meant for circulation. Paper money will be printed against it. But the paper Will be backed by real gold to the value of 25c., and by real silver to the value of 75c." I should like to draw your attention to the three major points which present themselves to me: First, there is not enough gold and silver obtainable in the world to carry out your two proposals. Second, irrespective of your currency proposal, there is no way, barring confiscation, in which a government can retire its funded debt by issuing currency, unless the currency so issued is unsecured printing press money. Third, irrespective of your bond proposal, your currency proposal is incomplete and not clear; therefore, I believe, it is not a useful suggestion to launch upon the public in its present form. As to the first of these three points, according to your own figures there are in the world to-day 550,000,000 ounces of gold and 8,800,000,000 ounces of silver. You propose that our currency should be backed, 25% by gold and 75% by silver. We have outstanding about five billions of paper currency. This you would retire and presumably replace with the new gold and silver-backed currency. In addition, you would issue this new currency to retire the "bloody bonds." The amount you would retire is not clear, because in your speech of Oct. 22 1933 you spoke of twenty billions of these bonds, while on Jan. 7 1934 you spoke of fourteen billions. Let us take the more recent figure. Prospect of Devaluation. You propose, then, to issue at least nineteen billions of currency, which means that you need, in round numbers, nearly five billions of gold and from fourteenth to fifteen billions of silver! Now, if the Treasury takes over the gold from the Reserve banks, as you suggest, we will have about four billions of gold against the five billions you require. You meet this by suggesting the revaluation of gold. Very 435 well, at the maximum revaluation possible under the law, you can make over these four billions into eight billions. You will then have three billions more than you need. You will then also have accomplished the desire of those who want a 50% devaluation of the dollar. But what about silver? The Treasury owns, so far as I know, less than $500,000 of silver at market value, so you must acquire about $14,000,000,000 more. Where? The world's total stock of silver, 8,800,000,000 ounces, is worth less than $4,500,000,000 at to-day market. Probably you wish to revalue silver also. At what price? In one of your broadcasts you have indicated 75 cents to a dollar. At $1 an ounce the world's stock is not enough to cover what you would require for this country alone. At $2, which is higher than any figure I have ever heard advocated, you would require for the United States all but about three and a half billions of the total of $17,600,000,000. Do you believe the rest of the world will sit by and let us take nearly all the silver—particularly if your plan were adopted here and seemed to work successfully, which you must be convinced it would? • Assuming the maximum revaluation of gold, we have just seen that under your proposal the Treasury might have three billions more gold than it would need. It would then have to buy fourteen billions of silver. - How is the Treasury going to buy $14,000,000,000 worth of silver with $3,000,000,000 worth of gold? Fears Printing Press Money. This brings to me my second point, which has nothing to do with your currency proposal. Apart from the profit in revaluing gold—a profit which cannot be taken again—is it not true that the Treasury's funds available for retirement of the "bloody bonds" can come only from the excess over expenditure of revenue raised by taxation—an excess which does not exist? Is there any other way it can obtain funds except, possibly, by confiscating private property? If that is true, is there any way in which the Government can redeem its funded debt by issuing currency, except by printing a currency which has no value other than that of an unsecured promise? And does it not follow that your proposal to retire "bloody bonds" by issuing currency necessarily involves the issuance of that real printing press money which you rightly recognize as the most cruel and unjust act of which a government is capable? Does not that prove my second point? And, if by chance you do not agree with my conclusion, why, if the currency is good currency, does it punish a holder of "bloody bonds" to be paid off in full? Finally, I say that your proposal of symmetallism is incomplete and not clear. This is why: You do not state at what prices gold and silver are to be figured in making up the dollar. This is important, because upon these prices will depend how many ounces of gold and silver you need to carry our your proposal. Upon these prices will depend also whether enough metal is anywhere obtainable, and how much it will cost the Government to obtain it. Rigid or Variable Currency? You do not state whether these prices are to be fixed or whether they are to be variable. This, too, is important, for it determines whether you are advocating a rigid currency—more rigid than that which we had under the recently abandoned gold standard—or whether you are advocating a dollar of variable metal content, such as the so-called commodity dollar. The two ideas are basically different, but your proposal might mean either. If your gold and silver alloy coin "will not be meant for circulation," shy do you propose going to the expense of coining it? Why not let the Treasury hold bar gold and bar silver in the proportions you have in mind? There are many other questions I could raise, but I will give you just one more example to show why I do not think you have fully realized the complexities of the money problem. You have frequently expressed antipathy to the gold standard and have characterized it as a device by which bankers keep the control of money away from the people. In your article you state: "Under the single gold standard system the paper dollar was backed by only 40e. of gold. In one sense it was a real printing press dollar—at least 60c. of it was." May I point out that, under the gold standard as we had it in this country, 40c. of gold was the legal minimum reserve, but that, as you yourself have pointed out in your speeches, the actual gold behind the dollar has averaged very much higher-60 high, in fact, as to cause you to complain, on Oct. 22 1933, "actually we have 110 gold dollars for every 100 paper dollars in this country." May I point out further that the other 60c. were not, as you imply, unsecured, but were compulsorily backed by at least 60c. worth of commercial Paper and Government bonds, and that a currency issued against such collateral, which may or may not be good practice, is not what it commonly meant by "a printing press dollar." Proposes Study of Idea. In conclusion, I do not wish to imply that the whole idea of symmetallism is to be dismissed as "unsound." It is an idea meriting the most careful study. It may have practical value in the future in a somewhat different form, provided the details can be properly worked out, and provided the best minds agree there is a need for it. I am not one of those who desire only a return to the old order. 1 am not one of those who make a fetish of the gold standard of the past. I have publicly advocated a very much modernized gold standard. I share with you the desire for intelligent reform, wherever our economic mechanism has broken down, either through its own inadequacy or abuse. It is because I believe that you have not realized the consequences of what you propose that I am writing you this letter, in the hope that your power over the' people's minds may turn into channels more consistent with what I believe to be your fundamental purpose. Yours respectfully, JAMES P. WARBURG. Rev. Charles E. Coughlin, P. 0. Box 150, Detroit, Mich. Final Results of Nation-Wide Poll of Fairchild PublicaVona Indicates Opposition by Merchants to Currency Inflation and Commodity Dollar. The American merchant is opposed to cur ency inflation and the commodity dollar, but favors devaluation varying from 25 to 50%, according to the final results of the na ionwide poll on inflation conducted by "Retailing Executive Edition," a Fairchild publication. The majority reporting are against a return to the old 100-cent gold dollar, 52% 436 Financial Chronicle voting for a revaluated dollar. It was further announced on Jan. 6: The industrial East showed a preponderance favoring a return to the old dollar and opposing any radical tinkering with our monetary system. The greatest number favoring a 50 to 60 cent dollar was recorded for the cotton and grain States, and several live stock raising States. The Middle West took an in-between course, not showing a high percentage on either side. The final results of the poll, which included every State in the Union, are as follows: 62% of those reporting voted against currency inflation; 58% do not believe that inflation can be controlled; 72% do not favor a dollar whose value fluctuates with the value of commodities, a so-called "rubber dollar"; 48% favor a return to the gold standard at the old 100cent level; 10% favor.a return at a 75-cent level; 17% at a 60% level, and 25% at a 50-cent level. According to A. W. Zelomek, economist of the Fairchild Publications, under whose supervision the poll was conducted, the results show that the American merchant is not as favorably inclined towards currency inflation as was popularly believed. At the same time, they are not in favor of a return to the old 100-cent dollar, but want a revaluated dollar. A preponderance among the thousands replying expressed confidence in the President's method of handling the monetary situation. The earlier indications of the poll were noted in these columns Dec. 9, page 4109. Jan. 20 1934 minutes—following which Vice-President Garner rapped his gavel to the accompaniment of the order: "Without objection the bill will be considered engrossed and read a third time and passed." The dispatch further reported: The House adopted the bill by a vote of 186 to 1, after two hours of debate. The arguments were directed chiefly against the move of the Democratic leaders to prevent amendments and followed closely the opposition expressed during the sustaining of administration plans last week. Fearful of the anticipated avalanche of amendments to authorize direct loans to small industry, leaders had to manoeuvre hurriedly before the House adjourned. They first planned to bring up the bill under the usual House rules and to place Representative Cannon of Missouri in the chair. He is one of the shrewdest parliamentarians in the House and it was believed that he would sustain any point of order against the amendments. Leaders Balk at New Gag Rule. But this plan was found dangerous to the passage of the bill as drafted. Another special "gag" rule was discussed, but this, too, was considered a bad plan. "They've been gagged until they are near strangulation," said a leader. The next plan called for bringing up the bill under suspension of the rules, allowing two hours of debate. This move necessitated a two-thirds vote on final passage, but it "put the members on the record," and forced them to vote for the administration plan. Representative McFadden of Pennsylvania, who tried unsuccessfully to impeach President Hoover during the last months of his administration, demanded a division vote. Representative Doxey of Mississippi, acting Speaker, swung his gavel in a circle and said there were 186 ayes. Mr. McFadden stood alone in opposition. Representative Luce of Massachusetts, closed the debate with high praise of the RFC and its officials. He said he deplored criticism of Jesse H. Jones, Chairman of the RFC. "It is the one organization of the Government that has stood the test 100%," he asserted. He said that its operations had been clean and above board. Mr. Jones came into the gallery as Mr. Luce was speaking and smiled in appreciation when Representative Britten of Illinois rose to call attention to the deplorable conditions in Chicago when one of the most criticized loans by the RFC was made. "But for that loan, banks in Detroit, Minneapolis, everywhere, would have gone down," Mr. Britten declared. Comptroller-General McCarl Holds FHC Illegal— Challenges Validity of Recovery Expenditures in $100,000,000 Program—Secretary Ickes Takes Ruling to President—Corporation Created Under NIRA. The constitutionality of the Federal Housing Corporation was challenged this week by Comptroller-General J. R. MeCarl in a letter to Secretary of the Interior Ickes. The text of this letter was not made public by either Mr. Ickes or Mr. MeCarl, but the former said on Jan. 16 that a ruling of the Comptroller-General, holding that expenditures by the Corporation without his own approval would be unconstitutional, was "a direct violation of the President's Order." Mr. Ickes added that if the ruling were sustained The approval of the bill by the House and Senate Banking it would tie up the funds of the Corporation and slow up and Currency Committees was noted in our issue of Jan. 13, its activities, which involve expenditures of approximately $100,000,000 provided for in the housing program. Mr. page 258. Ickes on the same day laid the Comptroller-General's ruling Reconstruction Finance Corporation Authorizes Issubefore the President, and later expressed the belief that ance of $250,000,000 2% Debentures and $260,000,the issue would be decided in his favor. 000 3% Debentures.—Action Taken to Co-operate A Washington dispatch of Jan. 16 to the New York with Banks Selling Preferred Stock and Capital Notes to the RFC. "Times" describing the ruling said in part: It was made known on Jan. 13 by Jesse H. Jones, ChairIn the press conference Secretary Ickes denounced the views of the Comptroller-General as to the Secretary's authority to make expenditures man of the RFC that the latter had authorized two new issues without a preview, afterward saying: of debentures,—each to the amount of $250,000,000,—one "Maybe I ought not talk this way about another Government official." While he thought the issuance of another Executive Order by the President maturing in one year and bearing 2%, the other maturing might placate the Comptroller-General, Secretary Ickes said that if the June 15, 1936, bearing 3%. Chairman Jones, announcelatter would not recognize one order, "he might not recognize another." ment follows: Hands Tied, Ickes Holds. As Mr, Ickes interpreted the opinion, the FHO is without authority to purchase a single option, buy land or perform other functions essential to the housing program without prior approval of the Comptroller-General's office for each transaction. Referring to Mr. McCarl, the Secretary said; "He says the framers of the Constitution never contemplated that a Corporation of this sort would be set up and, that therefore, it can't be done. He says funds devoted to purposes of the Corporation would have to be diverted to organization expenses, so we can't even organize. We offered to pay these expenses, $100 or $150, out of our own pockets, and he wouldn't even allow that. "The Comptroller-General has ruled that he roust be advised in advance about every transaction. He wants to know where the properties are, whether the price is a fair one and, in addition, he says each title must be examined by the Attorney-General's office. In some tracts there are hundreds of small parcels, and the Attorney-General would not have time to do anything else under this ruling." The incident attracted wide attention among officials of other Federal departments and agencies who, while not directly involved, said their work was dependent on the decision in this specific case. The Housing Corporation Law. The legal foundation for the MC rests in Title II of the National Industrial Recovery Act setting up the Public Works Administration. In this, as in all recovery legislation, the President or other officials in whom authority is vested are authorized to "establish such agencies" as are considered necessary to effectuate the purposes of the Act. "Construction, reconstruction, alteration or repair under public regulation or control of low-cost housing and slum clearance projects" are specifically mentioned as undertakings eligible to be financed by the PWA. The President on Nov. 29 issued an Executive Order authorizing the establishment of the FHC under his authority to create "agencies" and delegating the requisite authority to Secretary Ickes. While the delegation of this authority is not specifically challenged by the ComptrollerGeneral's opinion, Secretary Ickes considered it to have the same effect. Bill Extending Life of Reconstruction Finance Corporation for One Year Passed by Senate and House— Bill also Increases Lending Power of Corporation. Both the Senate and House passed on Jan 15, without amendment, the Administration's bill extending the life of the RFC for one year, from Feb. 1 1934; the measure likewise increases the lending power of the Corporation by $650,000,000 to $3,750,000,000. The bill was passed by the Senate unanimously. 'It was noted in the Washington account Jan. 15 to the New York "Times," that Senator Fletcher of the Banking and Currency Committee made a short explanation of the proposal—taking less than ten To further co-operate with banks who are selling the RFC preferred stock and capital notes, but who have no immediate need for the cash,the Corporation has authorized a $250,000,000 issue of one-year 2% debentures, and a like amount maturing June 15 1936, bearing 3%. The above are in addition to the $250,000,000 2)(% two-year issue authorized in December. RFC debentures are fully and unconditionally guaranteed both as to interest and principal by the United States, and are exempt principal and interest from all taxation, except surtaxes, estate,inheritance and gift taxes, now or hereafter imposed by the United States, any territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority. These debentures are only offered to banks in connection with preferred stock and capital note transactions, and to the extent sold will reduce the Treasury requirements for the RFC. Ruling by Comptroller of Currency O'Connor to Effect that Debentures of Reconstruction ,Finance Corporation are Obligations of United States. On Jan, 13, J. F. T. O'Connor, Comptroller of the Currency, ruled that, in his opinion, RFC debentures, which are now being sold to banks, are obligations of the United States within the intent of the Investment Securities Section of the National Banking Act. His ruling, made in response to many requests, said that— "Since such Act (Section 9, RFC Act), provides that such obligations shall be fully and unconditionally guaranteed both as to interest and principal by the United States, such guarantee shall be expressed on the face of the obligation and in the case of default the United States is obligated to pay the principal and interest, such obligations are considered by me to be obligations of the United States within the intent of Section 5136 Revised Statutes and not subject to the limitation thereunder as to the amount which may be purchased by a National Bank:: Reconstruction Finance Corporation Announces Appointment of Thomas J. Ahearn, Jr., as Assistant Manager of New York Loan Agency. Announcement was made this week by the RFC of the appointment of Thomas J. Ahearn, Jr., as Assistant Manager of the New York Loan Agency. Mr. Ahearn has been with the RFC since March 1932. Prior thereto he was the American Representative of the Anglo-French Banking Corporation of London, England; V.P.of the Seward National Bank, New York, N. Y., and for many years with the Guaranty Trust Co. of New York. Volume 138 Financial Chronicle House Passes Administration Bill to Guarantee Principal and Interest of $2,000,000,000 in Farm Loan Bonds—Measure Sent to Senate After Adoption with Little Debate. The House of Representatives on Jan. 16 adopted without a record vote the Administration bill which would guarantee the principal and interest of $2,000,000,000 in farm loan bonds and then sent the measure to the Senate. The projected legislation, introduced in Congress after a message from President Roosevelt, was described in our issue of Jan. 13, pages 255-256. A Washington dispatch of Jan. 16 to the New York "Times" summarized the principal features of the bill as follows: Under the terms of the new bill a Treasury-owned corporation, to be known as the Federal Farm Mortgage Corp., would be set up to handle the refinancing bonds. The corporation would be capitalized at $200,000,000, all of the capital to be subscribed by the Federal Government, and would have power to issue bonds to the aggregate sum of $2,000,000,000. As to these bonds, the bill says: "Such bonds shall be fully and unconditionally guaranteed both as to interest and principal by the United States, and such guaranty shall be expressed on the face thereof, and shall, on account of such guaranty, be lawful investments, and may be accepted as security, for all fiduciary, trust, and public funds the investment or deposit of which shall be under the authority or control of the United States or any officer or officers thereof." The corporation would be given a free hand in floating the bonds, not only as to forms and denominations, but as to rates of interests, prices, terms and conditions. An attempt to strike out the provisions of the administration bill to make the bonds tax-exempt failed by 57 to 61 votes. A proposal offered by Representative Brown of Kentucky to make the income from the bonds subject to ordinary taxation failed by 44 to 89. The idea expressed in the refinancing proposal was without opposition In the House. Farm relief advocates from the Dakotas and Minnesota tried to offer the Frazier Bill, providing refinancing of the entire agricultural Indebtedness through a scheme of bond and currency issue, but were ruled out of order by Representative Greenwood of Indiana, acting Speaker, and later by Speaker Rainey. Government Brings Tax Suit for $8,140,514, Charging Diversion of 1,271,955 Gallons of Denatured Alcohol for Beverage Purposes—Two Concerns Named as Defendants. The Federal Government on Jan. 13 filed suit in the Federal Court in Baltimore against the United States Industrial Alcohol Co. and the United States Industrial Chemical Co. in an endeavor to collect ,140,514 taxes on 1,271,955 proof gallons of denatured alcohol, alleged to have been diverted for beverage purposes. The Department of Justice described the suit as the first of a series of similar actions to be brought against other companies for large amounts. The United States Industrial Alcohol Co. was indicted in Baltimore in 1930 and fined $10,000. The tax suit arose out of this indictment. The Department of Justice said: The Government believes that the evidence that has been gathered indicates that there has been a very large loss of tax revenues justly due the Government, and the Attorney-General insists that this revenue be brought into the Treasury. During the past three years the law permitted industrial alcohol to be manufactured and sold on permits, but exempt from tax, and,likewise, the internal revenue laws provided that where such alcohol is diverted to beverage purposes a tax of $6.40 per proof gallon should be paid. No such tax has ever been paid during this period by the defendant, although the Government contends a tax has become due through the diversion of a large quantity of industrial alcohol to beverage purposes. The Government's complaint lists a large number of transactions of such claimed diversions to beverage purposes aggregating over 1,271,000 proof gallons. Investigation disclosed that, under the permits by which denatured alcohol could be sold only to legitimate users, there were set up a large number of "cover" houses which had no legitimate use for the material but were used to divert it to cracking plants where some of the denaturants were removed, from whence the material would find its way to illicit distillers, who undertook to remove the remaining denaturants, and supply the resulting alcohol through bootleg channels for beverage purposes to the public. While such diversion was, during this period, illegal under the prohibition laws, nevertheless, where it occurred, the taxes became due. The Government has brought suit against bootleggers for income taxes due on illegal income under a policy which recognizes the principle that taxes due the Government may not be evaded by reason of the illegality of the transaction under which they arose. This suit has been instituted to bring to the Treasury what the Government claims is due in taxes. There will be similar suits brought against other companies for large amounts in the near future. Taxes for the diversion of industrial alcohol for beverage purposes were provided long before the passage of the Vo'stead Act, inasmuch as industrial alcohol manufacturers were permitted to manufacture their products tax-exempt only provided they were used for commercial purposes, and were not diverted to beverage channels. These claims would be just as valid had not the prohibition amendment been passed. The Government by this suit affirms a policy that liability for taxes should be brought home where justified not only to the little fellow but the very large and powerful corporations as well. Secretary Morgenthau Suggests Door-to-Door Canvass to Spur Income Tax Payments. Door-to-door canvassing as a method of bringing about a maximum of income tax collections was suggested by Secretary of the Treasury Morgenthau on Jan. 17 in addressing a conference of Internal Revenue officials. Mr. Morgenthau 437 said that a house-to-house canvass might be conducted to make certain that tax returns be filectby all those who should file them. He asked the Internal Revenue officials to submit recommendations to the Treasury in order that the Secretary may decide whether to request the Civil Works Administration to allocate funds to cover the expense of the canvass. Mr. Morgenthau set $200,000,000 as the goal for back-tax collections this year, representing an increase of 51% over budget estimates of $132,400,000. FACA Ends Issuance of Liquor Import Permits Until Feb. 28—Allotments Made as Result of Trade Agreements Exempted. The Federal Alcohol Control Administration on Jan. 13 announced the termination of the first permit period for the importation of alcoholic beverages, except in the case of allotments made as the result of specific trade agreements. Applicants for permits were notified that no further original or supplemental permits will be issued to import definite amounts of alcoholic beverages until after Feb. 28. The ruling was noted as follows in a Washington dispatch of Jan. 13 to the New York "Times": The ruling does not interfere with the blanket authority granted to import unlimited amounts of American-type whisky and blending materials during a 30-day period. "Hereafter," the FACA said, "all permits will be issued by the Administration, and applications for permits to import alcoholic beverages will be granted only to those who have received the basic permit to engage in the importing business issued by the FACA under the code on Form 9A. All applications for such permits must be on file with the Administration by Jan. b.8 2 31.„ . No new permits for specific amounts will be issued until after Under this ruling no new applications or supplemental requests may be considered at present. Inventories of all distilled spirits, including alcohol, rectified spirits, wines and cordials, was ordered to-day as of Jan. 12 in telegrams to Collectors of Internal Revenue sent out by Commissioner Guy Helvering. The order provided that the returns must be filed within 30 days by all persons holding liquor stocks. The inventory is being taken in connection with the levy of taxes by the Federal Government. FACA Lifts Restrictions on Whiskey Imports for 30-Day Period in Effort to Force Bootlegger Out of Business —Makers of Ethyl Alcohol from Sources Other Than Grain Are Aided. The Federal Alcohol Control Administration on Jan. 10 lifted restrictions on the importation of American type rye and bourbon whiskey for a 30-day period and on the manufacture of pure ethyl'alcohol from sources other than grain. The action was taken to cut the price of liquor and to drive the bootlegger out of business, according to newspaper reports from Washington. We quote further details of the new order from Washington advices of Jan. 10 to the New York "Journal of Commerce": Inadequacy of the domestic supply of liquor has continued the bootlegger In business and has boosted the price of whisky. It was for this reason that the FACA,in a joint plan with the Treasury and the Department of Agriculture, "to remedy some of the unfortunate features of the present liquor situation," agreed to let in a large volume of liquor and to permit unrestricted alcohol manufacture. Quantities in Storage. Just how much American-type whisky is abroad officials did not know. They said that in Canada approximately 40,000,000 gallons is in bonded warehouses. Other liquors of this type probably are in storage in the French islands of St. Pierre and Miquelon, off the Canadian Atlantic coast, the Bahamas and in foreign countries, where there was believed to have been a considerable volume manufactured for the American smuggling trade. Also there are supposed to be large numbers of smuggling vessels off the coast which may now bring their products to this country and enter them through customs collectors. The FACA, Treasury and Agricultural departments, according to the statement, have been satisfied by official reports that the supplies of aged whisky and pure ethyl alcohol for blending and those of bottled American types of whisky for present consumption are entirely inadequate. It was believed that the market will soon be bare of palatable and wholesome American type whisky. Has Three-Point Plan,. The following three means of satisfying the needs of the country were devised: (1) Permitting the distillers and rectifiers to import for 30 days for use in their own plants in rectifying, American types of whisky in bulk, in any quantity. (2) Giving importers the right to import, in any quantity, the same types of whisky in bottles for the same period. (3) Allowing for 45 days the manufacture of any quantity of pure ethyl alcohol made from sources other than grain, such for example as molasses alcohol, for use in rectifying. The Administration also issued an order extending for 30 days the temporary permits for blenders and rectifiers. The original 30-day permits were issued Dec. 11. The order provided that no person's application would be considered who had not applied for a permanent license on or before Jan. 10. Liquor Advertisements May Be Mailed to Any State. John J. Kiely, Postmaster at New York City, on Jan. 13 sent an announcement to publishers in which he referred to Post Office Department Liquor Bulletin No.3 and stated that advertisements and solicitations of orders for intoxicating liquors are now mailable to all States. 438 Financial Chronicle House Adopts Liquor Control Bill for District of Columbia—Rejects Proposals for Government Dispensary System—With Passage of Similar Measure by Senate, Bill Goes to Conference. The House of Representatives adopted on Jan. 9 without a record vote a beverage control plan for the District of Columbia, permitting the sale of distilled spirits in the City of Washington under a licensing system plan, and imposing a tax of 50 cents a gallon on hard liquors and 35 cents on heavy wines. The House rejected all suggestions for a Government dispensary system. The Senate on Jan. 17 approved a bill practically identical with that already adopted by the House, and the measure went to conference for adjustment of minor differences. It was anticipated that it will receive final approval in time to permit the sale of legal liquor in the District of Columbia by Feb. 15. Federal Government Sues Standard Oil Co of New Jersey, Alleging Violation of Oil Code in Premium Contest—Secretary Ickes Says Company Refused to Discontinue Practice—Company Issues Statement Defending Its Position. The District of Columbia Supreme Court will hold a hearing Jan.30 on a bill of complaint filed by the Federal Government Jan. 16, seeking an injunction to restrain the Standard Oil Co. of New Jersey from alleged violation of that section of the oil code which prohibits the distribution of premiums in the sale of petroleum products. The suit was brought at the instance of Secretary of the Interior Ickes, Oil Administrator, who said that the action was based on numerous complaints that the company had refused to abide by pertinent provisions of the code, and had inaugurated a "boys' club contest" in which coupons are given to children in a prize contest. The specific charges were outlined as follows in a Washington dispatch of Jan. 16 to the New York "Journal of Commerce": The action of the company to which the offense was charged is a "boys' club contest" which it was said that the Standard Oil of New Jersey and its subsidiaries have inaugurated. Under the contest rules children are given books of coupons for distribution to other persons, who sign and return them to a Standard of New Jersey gasoline station. There is no requirement that gasoline or other products be purchased when the coupons are presented at the gasoline station. It was pointed out at the Oil Administration to-day that the provisions of the code banning the giving of oil premiums, prizes, free goods or other things of value, or the granting of any special inducement in connection with the sale of petroleum products, except by permission of the planning committee, was placed in the oil code at the insistence of the Standard of New Jersey, among other companies. Refuses to Drop Contest. The matter has been called to the attention of the Standard company "but upon advice of its counsel it has refused to discontinue the program," Secretary Ickes said. "The Planning and Co-ordination Committee took the matter up with the 011 Administrator and recommended that these unfair activities of the Standard 011 Co. of New Jersey be stopped," he continued. "Under my • instructions, and with the consent of the Department of Justice, attorneys of the Petroleum Administration Board to-day asked for an injunction in a suit filed in the District of Columbia Supreme Court. . "Rules 16 and 17 of Article V of the code prohibit the giving of premiums and other things of value unless permitted by the Planning and Co-ordination Committee representing the industry and so far as I am concerned apply to big companies and small ones alike. "This contest appears to me to be a clear violation of the fair competition rules of the Committee" The bill of complaint filed by the Oil Administration charged the Standard company with "unlawfully disregarding and disobeying the provisions of the code and the National Industrial Recovery Act." Jan. 20 1934 camps violates Rules 16 and 17 of the code of fair competition for the petroleum industry. Rules 16 and 17 do not present a new limitation on the marketing of Petroleum products. These rules have been in existence for four years, and since 1929 have been part of a code approved by the Federal Trade Commission. They were devised and intended to prevent the practice of selling petroleum products below the open posted prices. It is regrettable that the Government's interpretation of these provisions should lead it to attempt to interfere with a project In which prizes are offered not as a price concession or in any way in connection with sales, but in pursuance of a legitimate advertising program. It should be clearly understood, as emphasized in the radio announcement, that participation in the contest involves no obligation whatever to make any purchases from the Standard 011 Co. of New Jersey, or its affiliates. The company is supporting the code and endeavoring scrupulously to observe it in letter and service. Reduction in Gasoline Tax Imposed Under Federal Revenue Act of 1932. Effective Jan. 1, the excise tax on imports of gasoline imposed by the Revenue Act of 1932 has been reduced from 1M cents to one cent per gallon, customs officials have been advised by the Treasury Department. In the New York "Journal of Commerce" of Jan.6 it was stated that:. In December the total of excise taxes on oil, including gasoline, lumber, coal and copper, amounted to $.309,341.48 at this port. Shipments of oil and derivatives are smaller than for several years past due to the fact that they are under a quota system based on 1910-14 imports and during that period they were lower than at any time afterward. FERA Expended $324,428,488 for Relief Purposes Up to Jan. 1. The Federal Emergency Relief Administration granted $324,428,488 to States and Territories for emergency relief purposes between May 23 and Dec. 31 1933, it was announced on Jan.5 by Harry L. Hopkins, Federal Emergency Relief Administrator. Mr. Hopkins said that on Jan. 1 there was approximately $175,000,000 of the original $500,000,000 fund of the Administration still unexpended, and that he expected this to last until around April 1. Federal Judge Grants Nine Injunctions Restraining East Texas Operators from Exceeding Allowable Production. Federal Judge Randolph Bryant of Tyler, Texas, on Jan. 11 granted nine injunctions restraining East Texas oil companies from producing more than their allowable output fixed .by the State Railroad Commission. He characterized the Commission's proration order of Nov. 28 "prima fade valid." Counsel for the oil operators announced that he would appeal to the Circuit Court. Associated Press advices from Tyler Jan, 11 added the following details of the Court decision: Charles Francis, special assistant to the United States Attorney-General, who filed suit for the injunctions, also sought a ruling on the right of Federal agents to go on property of the defendants to see that State orders were enforced, but Judge Bryant struck out his decision on that point before he signed the injunction papers. The Texas Commission has been restricting the State's oil output to the allotment fixed by Secretary Ickes. Government attorneys had argued that writs obtained to enforce proration regulations in the East Texas field were valueless unless Federal °Tents could go on the properties and see that the orders were being earrid out. In a statement defending its position, issued Jan. 16, the Standard Oil Co. of New Jersey said: Wholesale NRA Code, Effective Jan. 22, Signed by President Roosevelt—Net Sales of Industry in 1929 Were More Than 15 Billion Dollars—Pact Provides 40-Hour Work Week—General Johnson Estimates 10 to 15% Increase in Employment. President Roosevelt on Jan. 13 signed a code of fair competition for the general wholesale trade, embracing 26 wholesale and distributing trade associations. The code establishes authority in various committees to fix price differentials to be observed by manufacturers and other primary producers and covers that portion of the general wholesaling field not included under pacts previously formulated by both the National Recovery Administration and the Agricultural Adjustment Administration. It affects 45,043 establishments which in 1929 had net sales of $15,323,429,000 and which emmyed 675,000 persons. It will become effective Jan. 22. The code provides a 40-hour work week, and it was estimated by General Hugh S. Johnson, Recovery Administrator, that this would increase employment 10 to 15%, erasing one-half of the unemployment in the industry since 1929. Minimum pay was specified at $14 and $15 weekly, based on a population scale. A Washington dispatch of Jan. 14 to the New York "Journal of Commerce" added the following provisions of the wholesale code: Standard 011 Co. of New Jersey announces its intention to oppose the application of the Secretary of the Interior for an injunction to restrain it from carrying out Its radio contract with Babe Ruth, who has enlisted 500.000 youngsters in his Babe Ruth Boys' Club conducted over the air. The suit is understood to be based on the theory that the offering of prizes to boys in the form of baseballs, fielders' mitts and trips to training The 26 commodity divisions in the wholesale code include dry goods, buttons, charcoal and packaged fuel, cycle jobbers, beauty and barber supplies, electrical supplies, embroidery and lace, floor covering, furriers' supplies, hardware, hats and caps. jewelry (including watchmakers and jewelers' supplies), men's novelty jewelry, men's wear buttons, notion (thread and women's garments supplies),radio,school supplies,sheet metal, Sees Industry Disrupted. It was contended that the practices of giving away premiums, prizes or other things of value or granting special inducements in connection with the sale of oil products has "seriously and adversely affected during several years last past the whole of the petroleum industry in the United States, and the said practice has not only caused drastic price wars, which have spread in widening circles, but has likewise caused or contributed to the diminution and disorganization of inter-State and foreign commerce." The practice was also charged with calming wage reductions, growth of unemployment and waste of natural resources. It was held that the "contest" would "tend to divert the flow of petroleum products from other States to States in which the defendant is engaged in business." The Oil Administration argued further that continuation of the contest "by the Standard company would cause other persons engaged in the oil industry to indulge in such a practice," and there is"grave and impending danger at the present time that the said contest will provoke a price war extending into many States, and will result in demoralization and dislocation of inter-State commerce." "The example of this defendant's continued violation of the NIRA and the code with impunity will cause dissatisfaction within the industry and others now observing the law in the present emergency will be led to believe that anyone desiring unfairly to profit at the expense of co-operation of others may do so without let or hindrance." Volume 138 Financial Chronicle silverware, twino and cordage, upholstery and decorative fabrics, wall paper, and woolen and trimming garment supplies. In the wholesale code, instead of the original minimum rates of pay of $14 per week in cities of over 500,000 population and $12 in cities of less than 100,000, the minima for trade is fixed at $15 per week in cities of 500,000 or more population and $14 in cities of less than 300,000, with a differential of $1 per week in favor of the Southern section of the trade. Salary for Learners. Learners are to receive $I per week less than the minimum, and "junior employees' between the ages of 16 and 18,$2 per week legs than the minimum A "wholesaler" or "distributor" under the code is defined as any individual, partnership, association, corporation, or other firm, or a definitely organized division thereof, definitely organized to render and rendering a general distribution service, which buys and maintains at his or its place of business a stock of the lines of merchandise which it distributes; and which through salesmen, advertising, and (or) sales promotion devices, sells to retailers and (or) to institutional, commercial, and (or) industrial ,users; but which does not sell in significant amounts to ultimate consumers. Modifications or extensions to this definition or any part of it may be made for specific divisions when embodied in any appropriate supplemental code or when recommended by the appropriate divisional code authority and approved by the Administrator. Code Authority Provided. The codo provides for a general code authority and divisional code authorities. These agencies are to be representatives of the trade. The powers of general and divisional code authorities are set out in Article VI of the code. The trade practices proposed in Article VII are not in any respect objectionable, it was held by General Hugh S. Johnson, Recovery Administrator, in transmitting the code to the President for approval. Article VIII, sectional, provides for the possibility of setting up price differentials between different classes of buyers, thus recognizing the functional discount desired by wholesalers and distributors. All sections of this type are with the advice and subject to the approval of the Administrator. Pending the formulation of a compact between the several States of the United States to insure the manufacture and sale of prison-made goods on a fair competitive basis with goods not so produced, the provisions covering prison-made goods will be stayed for 90 days, or further at the discretion of the Administrator. To Organize Utility Security Owners on National Scale. Plans to organize a nation-wide association of public utility security owners for the purpose of opposing the forces that are depressing the fair value of utility securities, were announced at Chicago recently by Chester D. Tripp, President of the American Federation of Utility Investors, Inc., a non-profit corporation recently formed for this purpose. An announcement issued in the matter added: The Federation intends to take definite action to prevent the destruction of public utility values. It does not matter, Mr. Tripp declares, if the destructive forces be set in motion by an act of government—Federal, State or municipal—or by unscrupulous financiers and managers who have brought some of the units of the utility industry into disrepute. Every force that endangers the fair value of public utility securities will be vigorously opposed. As a nucleus for the nation-wide organization, the Federation has formed an advisory committee of outstanding men which already numbers 71 members, to represent all sections of the country and practically all lines of business activity and professions except the utility industry and investment banking. Headquarters of the new organization will be in Chicago. The average price of listed utility stocks has dropped more than 19% during the past year of general recovery, Mr. Tripp pointed out, while the average prices of listed railroad and industrial company stocks gained more than 60%. The prices of all other classes of utility securities have similarly reflected the effect of adverse forces. This decline, it is stated, affects not just a few wealthy individuals, but all holders of utility securities, who now number upwards of 10,000,000. The members of the organizing and management group of the Federation are themselves either largo holders of utility securities or are responsible for the management of them in a fiduciary capacity. The Federation differentiates itself from other similar organizations by the fact that it is appealing to the great mass of small utility investors for its support rather than to a few wealthy individuals. The officers of the Federation are: Chester D. Tripp, Chicago, President; Benjamin F. Castle, New York, and Willard N. Boyden, Chicago, VicePresidents. Clayton J. Howel is Executive Secretary. J. De Forest; Richards, Chicago, is Treasurer. The Federation declares that no officer or director of this group is engaged in utility operation or management, that it has no affiliation with utility managements, and that it has no alliances, political or otherwise, that might hinder its freedom of action in carrying out its aims. The President of the Federation, Chester D. Tripp, is an internationally known consulting metallurgical engineer. During the war he served on the War Industries Board as technical advisor on the alloy industry, being particularly well known for his activities in the development of manganese reserves in this country. Cigar Makers' Union Offers 850,000 Annually to Industry in Return for Right to Organize Plants— Money Would Be Used for Advertising Purposes. The Cigar Maker's International Union, affiliated with the American Federation of Labor, on Jan. 14 offered to contribute annually a $50,000 fund to the cigar industry, to be used for advertising purposes, if the industry in turn would "refrain from all opposition to complete organization and unionization of their plants." This offer was contained in a letter sent by I. M. Ornburn, President of the Union, to 125 companies which the Union said produced 90% of all cigars manufactured in the United States. Associated Press advices from Washington Jan. 14 added the following details of the letter: It stipulated that the employers instruct their "superintendents,overseas, foremen and all others who have contact with the cigar workers to refrain from all acts which might dissuade or tend to dissaude workers from joining" the Union. 439 "While this sum is not a large one it can command advertising which ordinarily would require an outlay of perhaps a quarter million dollars," the letter said, pointing to the "about 5,000,000" American Federation of Labor workers in the country. Penn Mutual Life Insurance Company Announces Changes in Personnel—Gordon A. Hardwick Named Vice-President. Gordon A. Hardwick, Comptroller of the Penn Mutual Life Insurance Co., has been elected a Vice-President, it was announced this week by William A. Law, President of the company. Mr. Hardwick will also continue as Comptroller. Donaldson Cresswell, who has been in the legal department of the company for five years, was named Associate Counsel, succeeding Herbert Adam, who becomes Assistant VicePresident and Supervisor of Claims. Mr. Law also announced the selection of Joseph M.Conover, Assistant to the Vice-President, to be Assistant to the Vice-President and Comptroller; Warner F. Haldeman, to be Assistant Counsel, and Floyd T. Starr, to be Assistant Treasurer. United States District Court Rules as Void Embargo on Out-State Shipments of Wheat—State Law Held to Be Without Force or Effect. An embargo on shipments of wheat from North Dakota, proclaimed on Oct. 16 (effective Oct. 19) by Governor Langer, was declared void on Jan. 15 by the U. S. District Court at Fargo, and the law under which the embargo was imposed was held to be without force or effect. Reference to Governor Langer's embargo was made in these columns Oct. 21, page 2878. In our issue of Dec.9, page 4080, it was noted that on Dec. 6 the Governor lifted the embargo for a 10-day period. As to the conclusions of the Court, the Minneapolis "Journal" of Jan. 15 said: The decision was handed down by Judges John B. Sanborn, Andrew Miller and Matthew W. Joyce, and followed hearings conducted by them in Minneapolis and Fargo on an action brought by a group of North Dakota elevators which !Ought to break the embargo. The Judges held that the power to declare embargoes and thereby interfere with inter-State commerce does not lie with the Legislature of North Dakota, but that all matters relating to commerce between Statesis dubject to action only by the Congress of the United States. They ordered an injunction against further attempts to enforce the ban against wheat shipments. The embargo was declared by Governor Langer Oct. 16, as he expressed it, to call attention to the plight of North Dakota agriculture. He threatened to call out the North Dakota National Guard to enforce the embargo but finally placed enforcement in the hands of the sheriffs. For several days there was little halting of shipments but finally an almost complete tieup was effected. A Bismarck, N. D. dispatch Jan. 15 said: Possibility that the decision of three Federal judges, holding North Dakota's embargo law unconstitutional, will be appealed to the United States Supreme Court, was seen to-day by Attorney-General P. 0. Sathre. Right of Nebraska to Regulate Weight of Bread Upheld by United States Supreme Court. The right of the State of Nebraska to regulate the weight of loaves of bread was upheld on Jan. 8 by the United States Supreme Court, which atso upheld the provision in the law empowering the Governor and Deputy Secretary of Agriculture to enforce the act. The law provides that loaves should not exceed the prescribed weight for 12 hours after cooling by more than three ounces. Regarding the findings of the United States Supreme Court, a Washington dispatch Jan. 8 to the New York "Journal of Commerce" said: In a decision rendered by Justice Butler against the P. F. Petersen Baking Co., Schulze Baking Co.. Continental Baking Co. and others, it VMS denied that there is merit to the claim that the delegation of authority to the Secretary violates the due process of equal protection clause of the Constitution. Rate of Tolerance. Rules and regulations promulgated by the Secretary require the rate of tolerance not to exceed three ounces to the pound, the bread to be so made that under normal conditions it will maintain the minimum weight for not less than 12 hours after cooling. In protesting the Act, the appellants contended that (1) a maximum tolerance is arbitrary and discriminatory; (2) the statute vests arbitrary power in the Secretary; (3) it is impossible to comply with the prescribed tolerances, and the provisions as to time, place, possession and particular loaves subject bakers to fines irrespective of negligence. "It is not shown that the prescribed tolerances are unreasonable or that the statute and regulations operate to prescribe punishment in the absence of fault," the high court ruled. Calls Finding Warranted. "The lower court found, and the evidence warrants the finding, that appellants and other bakers readily may comply with the prescribed weights and tolerances. It is therefore to be presumed that in the absence of fault or negligence, violations will net occur. "Moreover, the State Supreme Court held that a secondary purpose of the act is to prevent unfair competition by dishonest bakers resulting in injury to the consuming public. As there is no showing that the measure is not reasonably calculated effectively to serve for that purpose, the judgment upholding the act must be affirmed." Associated Press advices Jan. 8 from Lincoln, Neb., said: The Nebraska bread law, upheld Monday by the United States supreme Court, will not go into effect until the mandate of that tribunal has been received here, at least 20 days hence. 440 Financial Chronicle Attorney-General Paul Good, who argued the case in Washington, zaid that if the mandate were framed as he expected, the baking companies which brought the suit would have only the recourse of applying to the State Department of Agriculture for a change in the regulations under the law. After the Legislature enacted the law in 1931, the Department, acting under its authority, ruled that bakers' bread must be in loaves weighing a half pound, pound, pound and a half, or multiples of a pound, with three ounces of tolerance for each pound of weight. The bakers appealed,saying this tolerance was insufficient. Ian. 20 1934 "The first possible objection is that I am a trustee, director and stockholder in the Pulitzer Publishing Company which publishes The St. Louis 'Post-Dispatch.' While I take no share in the management of the paper. of which my brother. Joseph Pulitzer, is the publisher, yet I obviously have a financial interest in it. "The second possible objection is that under the conditions of the ScrippsHoward purchase of The New York "World" there are certain payments still to be made. I am, therefore, to that extent interested in the welfare of The New York "World-Telegram," although I have no connection whatsoever with this newspaper. "If you still feel, as you felt at our last interview, that these facts constitute no disqualification, I put myself gladly at your disposal, but if, on further consideration, you feel that they might interfere with my fitness for the position, I shall understand it perfectly. "If you appoint me to the deputy administratorship I should appreciate your publishing this letter at the time you announce my appointment, 80 that the public may be fully apprised of the facts." Samuel Untermyer Declares NRA Discriminates Against Traveling Salesmen—Defends Recovery Program but Asserts It Should Include "White Collar" Workers. Samuel Untermyer, New York attorney, speaking before On Jan. 16, General Johnson replied to Mr. Pulitzer as a meeting sponsored by the National Council of Traveling Salesmen's Associations on Jan. 4, declared that the 900,000 follows: "I am glad you recorded your secondary interest in the publishing field. "drummers" in the United States who had not been provided In view of your own record and the long and liberal record of your family, for under the National Industrial Recovery Act had been this does not in my opinion change your availability, and I am very happy "deliberately, unjustly discriminated against." Mr. Unter- to know you are going to be with us." myer said that he was an ardent champion of the NRA, Alexander Baxter and George Satterthwaite Appointed but that he believed that traveling salesmen, along with Special investigators to Aid Enforcement of other so-called white collar workers, had failed to receive Steel Code. due consideration. He predicted success for the recovery Directors of the American Iron & Steel Institute on Jan. 9 program, however, and said that "big business and selfish announced the appointment of Alexander Baxter and crooked high finance" constituted the greatest handicaps to George Satterthwaite as special investigators, as part of its completion. We quote further from his remarks as the program of the code authority for enforcement of the contained in the New York "Herald Tribune" on Jan. 5: provisions of the steel code. Mr. Baxter was formerly a "Your protection," he said, "alone of all classes of employees, has not partner in a firm of certified public accountants and Mr. only been neglected and ignored but you have been in express terms exSatterthwaite was an executive of an independent steel cluded. In the many codes examined by me, whether referring to hours of company. labor, term of service or minimum wage, the three words, 'except outside salesmen,' whether working on salary or commission, or both or whether In announcing this step to the members of the code, or not under contract for a definite term, their exclusion is made equally W. S. Tower, Executive Secretary, said that the duty of specific and conclusive. You have not been overlooked. You have been the investigators "shall be to assist the administrative deliberately, unjustly discriminated against." Mr. Untermyer pointed out that the salesmen were not asking any committee in seeing that the members of the code perform definite term of employment or limitation of hours, but merely a provision their obligations thereunder, including the investigation under the NRA for a guaranteed minimum wage, if on a salary basis, or if on a commission basis, a minimum,drawing account—the minimum to be of all alleged violations of the provisions of the code which fixed by the proper code authorities of the different industries. may be reported." "You men have suffered," he continued. "and are still suffering from In the official notice members of the code were urged to this depression to a greater extent than any other class. Unless this wrong is righted you will continue to suffer. The NRA has not changed the selfishgive full co-operation in the enforcement effort, and were ness of human nature in business. reminded that it is their duty to report promptly any facts Calls Salesmen Ambassadors. coming within their knowledge respecting code violation. Asserting that in 1929 at least 90% of all outside salesmen had regular salaries and drawing accounts, as against 10% to-day, Mr. Untermyer praised the traveling salesmen as "merchandise counselors to the retailers," "stimulators of business," "ambassadors of new styles and new merchandise," and as "one of the most important links in the chain of modern national distribution." "We have a code in each industry for the workers, the employers, and for every link in that chain of production and distribution except for you," said Mr. Untermyer. "Why?" Declaring President Roosevelt's economic experiment to be the beginning of a bloodless revolution that is destined eventually to level the inequalities of wealth," Mr. Untermyer added: "Why then should it be marred by the NRA, which is the beautiful dream of a practical idealist, arbitrarily excluding this one important element in the system of distribution, without which there could be no distribution? If there were no such cog as yours in the wheels of industry, it would have to be created." Interim Report to Be Presented Jan. 26 at Annual Meeting of New York Bar Association by Committee Named Last July to Study National Recovery Act and Its Administration—Gilbert H. Montague Chairman of Committee. On Jan. 15 the following statement was issued by Gilbert H. Montague, Chairman, Committee on National Recovery Act, New York State Bar Association: A study of the National Recovery Act and its administration, consequences and effects is now being made by a State-wide committee appointed last July by Judge Samuel Seabury. President of New York State Bar Association. This committee consists of Gilbert H. Montague of New York City, Chairman, and William C. Breed of New York City, Stewart F. Hancock of Syracuse, Merwin K. Hart of Utica, Evan Hollister of Buffalo, Ross M. Lovell of Elmira, Benjamin Miller of New York City, and Allen Wardwell of New York City. An interim report will be presented by this committee at the annual meeting of the New York State Bar Association on Jan. 26 In New York City. A further report, dealing with the administration,consequences and effects of the National Recovery Act, will be submitted by the committee to the Association at or before the January 1935 annual meeting of the New York State Bar Association. Ralph Pulitzer Appointed Deputy NRA Administrator for Newspaper Code—Pact Awaits President's Approval. Ralph Pulitzer of New York,former publisher of the New York "World," has been appointed Deputy NRA Administrator in charge of the'newspaper and graphic arts codes, it was announced on Jan 17 by General Hugh S. Johnson, Recovery Administrator. These codes have been on the President's desk for more'than a month, awaiting his approval. Before accepting the appointment, Mr. Pulitzer, in a letter to General Johnson dated Jan. 13, listed possible objections to his service as follows: Retail Code Praised by Head of National Retail Dry Goods Association at Annual Convention—Lew Hahn Points to Progress Under NRA—Prof. Nystrom Asks Support for President Roosevelt in Stabilization Program. A vigorous defense of the retail trade from charges of profiteering and praise of the National Recovery Administration for the impetus it has given business were contained in an address delivered on Jan. 15 by Lew Hahn, President of the National Retail Dry Goods Association, at the opening session of the annual convention of that organization in New York City on Jan. 15. Delegates were welcomed by Mayor LaGuardia of New York, who appealed for the cooperation of business men in the work of his Administration. Prof. Paul H. Nystrom of Columbia University, President of the American Marketing Society and Assistant ViceChairman of the National Retail Code Authority, analyzed the business situation and called upon the convention to support President Roosevelt in his program for stabilization of the dollar. We quote from the New York "Journal of Commerce" of Jan. 16 regarding Mr. Hahn's address on that date: The keynote address of the convention was delivered by Lew Hahn, its President and a member of the Retail Code Authority. Mr. Hahn defended the retail trade from the charge of profiteering that had been raised in the recent past. He believed that a misunderstanding is at the bottom of most of these charges because it is the retailer in whose final prices the consumer is presented with the bill for all the added cost items that have been Included in the making and transporting of the merchandise before it finally comes to the consumer through the retailer. He suggested that a committee of controllers study retail costs and in an easily understood manner present to the country just how much of the price the retailer charges represents labor costs in the final analysis. Mr. Hahn fully indorsed the NRA and what it had done and will do for American business in the future. With regard to the retail trade he summed the statement up in the following five points: "1. The retail code has compelled Government, the public, the economists and other branches of business to recognize the retail trade as something separate and distinct from the industrial organization of the country; something which requires special consideration in terms of the nature of Its processes and problems. Horizontal Organization. "2. It Is a horizontal code and its existence has prevented, for the most part, the setting up of vertical codes starting with the manufacturer and reaching down through the various economic steps to include and control the retailer. "3. The labor provisions in the retail code operate to remove a definite and important unfair element is competition. "4. The trade practice provisions steadily will become more important as they secure general acceptance and are bound to have an influential effect upon National and State legislation. Financial Chronicle Volume 138 Permanent Retail Councils. "5. The administrative provisions of the retail code are going to result in the first thorough and effectual organization of the retail trade. As local code authorities tlre set up and become effective they will form the nucleus of permanent councils of retailers and the procedure for effective operation will prove to have been charted under the compulsion of this emergency." Sees NRA Permanent. Mr. Hahn condemned the old economic system because "building upon so firm a foundation as the continuing wants of consumers, we have been unable to make anything but a huge gamble out of every form of business." RFC Loans to Trade. Admitting that many retail stores of old established standing find themselves short of working capital after four years of losses and in view of higher replacement prices, Mr. Hahn has taken up this problem with the Reconstruction Finance Corporation. He said that "it is entirely possible for retailers to secure RFC loans." Touching upon the major problems that will face retailers in 1934. Dr. Paul H. Nystrom, Professor of Marketing at Columbia and President of the Limited Price Variety Stores Association, Inc., called upon the merchants to challenge unjustified price increases in their own interest and on behalf of the consumer. Too Rapid Rise. "There is a real danger that a too rapid rise in prices may arouse active consumer opposition and so retard or set back the natural progressive improvement of business," he said. "This problem, so far as the retailer is concerned, is one that can only be solved by the retail store buyers, who must themselves be convinced of the necessity of every price increase before making their purchases, so that they in turn may be able to explain these price increases to their sales people and more important still, to the consuming public." The New York "Times" of Jan. 16 quoted Professors Nystrom in part as follows: After Mr. Hahn's address, Professor Paul H. Nystrom of Columbia University, President of the American Marketing Society and Assistant Vice-Chairman of the National Retail Code Authority, presented an analysis of the business situation. He emphasized the necessity for stabilization of the dollar as a prerequisite to revival. Welcoming the steps in this direction suggested by President Roosevelt. he called upon the convention to declare emphatically that "you favor such stabilization and that you expect Congress to back up the President's effort. "In so far as price instability may be due to the wavering values of the dollar, the President and Congress have a definite responsibility to American business." Professor Nystrom said, "We may grant the difficulty at the present time of setting the standard of value of our dollar on a trading basis, but in the meantime domestic trade is being retarded, discouraged and held up by the lack of monetary stabilization. This is a detriment to every domestic activity. "I do not so much care whether we go back to the old gold standard or set the dollar at some new gold value. Indeed, while this is not, in my opinion, a good time to make so vital a change, I would not object to a commodity dollar. The important thing at present is not so much what the standard of value shall be as it is that there should be a fixed, determined and constant standard. "Every sound business in this country, including retailing, needs a prompt re-establishment of some definite basis of dollar value." Frank C. Walker Names 44 State Directors to Survey Compliance with NRA and AAA Codes and Marketing Pacts. Frank C. Walker, Chairman of the National Emergency Council, on Jan. 12 announced the creation of a Nation-wide machinery for thorough scrutiny of compliance with National Recovery Administration and Agricultural Adjustment Administration codes. Mr. Walker appointed 44 State Emergency Council directors, having responsibility within their States of directing compliance with codes and marketing agreements and for adequate representation of consumers. They will also establish information bureaus and make surveys of all emergency organization activities with a view to deciding which, if any, of such committees or activities can be abolished, consolidated, or co-ordinated. Nathan Straus Jr. of New York City was named director for New York, while Thomas Conway,a Plattsburg, N. Y., attorney, was appointed Chairman of an advisory board to assist in handling the unusual volume of work in New York State. Charles Edison of West Orange, N. J., sone of the late Thomas A. Edison, was named director for New Jersey. Other State directors are: Alabama—Judge John D. Petree, Russellville. Arizona—Steve A. Speak, Prescott. Arkansas—J. J. Harrison, Little Rock, California—George Creel, San Francisco. Colorado—Thomas A. Duke, Pueblo. Delaware—Dr. Charles M. Wharton, Dover. Florida—Walter Hawkins, Jacksonville. Georgia—Dr. Andrew McNairn Soule, Athens. Idaho—Will Simons, Boise. Illinois—John E. Cassidy, Peoria. Iowa—John J. Hughes, Des Moines. Kansas—Jonas Graber, Kingman. Kentucky—Judgc J. R. Layman, Elizabethtown. Louisiana—Edward .T. Gay, Plaquemine. Maine—Edward P. Murray, Bangor. Maryland—Arthur E. Hungerford, Baltimore. Massachusetts—P. A. O'Connell, Boston Michigan—Edmund C. Shields, Lansing. Mississippi—Simon S. Marks, Jackson. Missouri—Robert K. Ryland, Kansas City. Montana—Miles Romney, Hamilton. 441 Revised Wool Code Effective Jan. 29, Following Approval by Recovery Administrator—Covers Financing, Grading, Warehousing, Selling from Grower to Manufacturer—Trade Practice Provisions to Be Added Later. A revised code of fair competition for the wool trade will become effective Jan. 29, following its approval on Jan. 16 by General Hugh S. Johnson, Recovery Administrator. The pact covers merchants who handle the financing, grading, warehousing and selling of wool from grower to manufacturer. No trade practice provisions are included, but it is provided that within 60 days after the effective date the Code Authority shall submit recommendations for such provisions. A Washington dispatch of Jan. 16 to the New York "Journal of Commerce" listed the following provisions of the code: The wool trade, as defined in the code, does not include top makers who, although owning no machinery, buy wool, sort it and cause it to be scoured and combed in proper blends by the commission wool comber. The top makers will be brought under the wool manufacturers' code. The term "wool trade" is defined as the business of buying, selling or deallng in any of the following commodities: (a) Wool,shorn or hulled;(b) new wool waste;(c) noils and all other byproducts of wool manufacturing; (d) products of wool resulting from preparatory processes, which includes the products of the process of grading, shorting, dusting, picking, carding, garnetting, carbonizing and scouring. The code exempts from its provisions employers who do not employ more than five persons and are located in towns of less than 2,500 population, which are not in the immediate area of a city of larger population. 40-Hour iVeek. It provides that no employee shall be permitted to work in excess of 40 hours in any one week except watchmen, outside salesmen and buyers, and employees engaged in a managerial or executive capacity who receive more than $35 per week. It is provided, however, that clerical and office employees may be permitted to work 40 hours per week averaged over the six months each year, beginning May 15, but in no event in excess of 48 hours in any one week, and further provided that watchmen shall not work more than six days per week. No employee shall be paid less than the rate of 373c. per hour, this provision establishing a minimum rate of pay, regardless of whether an employee Is compensated on a time rate, piece work, or other basis. The usual labor provisions are set out in the code and administration is to be handled by a Code Authority to be elected by the trade. Postponement to Jan. 26 of Hearing at Hartford to Test Enforcement of Provisions of NRA Code Affecting Cloak and Suit Industry. Federal Judge Thomas at Hartford, Conn., is said to have reluctantly postponed on Jan. 15 a test case on the suit and coat National Recovery Administration code to Jan. 26 because Government lawyers from Washington were not ready to proceed. A dispatch from Hartford to the New York "Times" said: Plaintiff manufacturers allege that the New York code authorities have violated an injunction and refused NRA labels. They plan a mandamus action in the District of Columbia. The action was referred to in our issue of Jan. 6, page 64. National Labor Board Has Handled Cases Involving 600,000 Workers Since Formation Last August— Most Disputes Have Been Settled by Agreement, Senator Wagner Says-87 Strikes Averted by Regional Boards. The National Labor Board and its regional boards have handled eases involving approximately 600,000 workers, according to a statement on Jan. 6 by Senator Wagner, Chairman of the Board, in which he summarized its activities since its formation on Aug. 5 1933. A large proportion of the cases were settled by agreement, the report said, while strikes showed a steady decline,as did the number of cases pending before the Board. Disputants are resorting to Labor Boards in increasing numbers, Senator Wagner said. Additional details of his report are given below, as contained in a Washington dispatch of Jan.6 to the New York "Times": Up to Dec. 15, 350.000 workers were involved in National Board and 220,000 in regional board cases, Senator Wagner said. Since then cases involving an additional 120,000 have been before the Boards. Allowing for duplications the total figure was set as 600,000. The National Board has taken jurisdiction in 155 cases involving 350.000 workers, of which 97 cases were strikes or lockouts. Of the total. 104 cases have been settled, 14 are pending, 25 have been referred to regional boards and six to the Labor Department or special committees. Senator Wagner said that a notable feature of the adjustment machinery was the averting of 87 strikes by the regional boards and the settlement of 273 strikes by 11 of these boards. New York Cases Totaled 170. The New York Board, he said handled 170 cases between Oct. 24 and Dec. 15, involving 21,087 workers; settled 148 strikes, averted 22, obtained arbitration in six cases and caused the reinstatement of 552 workers discriminated against for union activity. "The lists of cases read like a roster of the Nation's industries," Senator Wagner added. "so varied have been the problems put before the Boards. No case has been too small, as many cases involve only two or three workers: and a single case may involve 76,000. All the while, it must be remembered that the Boards' members, some 170 men, are volunteers serving under Presidential appointment without compensation, comprising busy industrialists and labor leaders, with impartial chairmen drawn generally from the ranks of universities or the bench. 442 Financial Chronicle "Despite certain recalcitrants, the outstanding thing still is the widespread acceptance of this system of settlement of disputes, which was created by Presidential order adopting a joint proposal of capital and labor. "Instances of what are termed 'clefiances' of the Boards naturally make more spectacular headlines than do these quiet labors which, for example, prevent strikes from breaking out and so getting into the newspapers. Those who do challenge the Boards' activities are, I am afraid, people with bad cases and bad consciences. "Unquestionably there is a small minority, the same minority which wants all the advantages of the National Recovery measures and none of the responsibilities, and to deal with this minority steps will have to be taken to prevent their getting an advantage over the majority which is honestly endeavoring to attain the better industrial relations necessary to recovery and reform." Tire Code Authority of 16 Members Appointed— Includes Most of Leading Figures in Industry. The automobile tire industry on Jan. 10 appointed a Code Authority of 16 members, in accordance with the terms of Its agreement with the NRA. Including many of the most prominent men in the industry, the members of the Authority were listed as follows in the New York "Journal of Commerce" on Jan. 11: Harvey Firestone, Chairman, Firestone Tire & Rubber Co.; F. B. Davis Jr., President United States Rubber Co. ; P. W. Litchfield, President Goodyear Tire & Rubber Co.; J. D. Tew, President B. F. Goodrich Rubber Co.: F. A. Seiberling, President Seiberling Rubber Co.; William O'Neill, President General Tire & Rubber Co.; Irving Eisbrouch, President McClaren Rubber Co.; Charles Borland, President Mohawk Rubber Co.; E. D.'Levy, President Fish Tire Co.; J. A. Walsh, President Armstrong Rubber Co.; W. 0. Rutherford, President Pennsylvania Rubber Co.; C. C. Gates, President Gates Rubber Co.; J. W. Whitehead, President Norwalk Tire & Rubber Co.; A. A. Garthwaite, Vice-President and General Manager Lee Tire Co.; Carl Pharis, President Pharis Tire & Rubber Co.; J. A. MacMillan, President Dayton Rubber Co. The Code Authority also will consist of two ex-officio members without vote in deciding the industry's policies, W. H. Laney, President KellySpringfield Tire Co., Chairman of the Board, Rubber Manufacturers' Association, and A. L. Vines, President of that Association, and who will act as Chairman of the Tire Code Authority. It was learned also that Mr. Firestone had designated the President of his company, J. W. Thomas, to serve on the Authority in the event that he is not able to do so. List of Companies Filing Registration Statements with Federal Trade Commission Under Securities Act. In a new list of registration statements filed under the Securities Act, the Federal Trade Commission announced on Jan. 10 ,000,000 in new security issues, $7,000,000 of which represent new capital. Beverage industries account for $5,000,000, the natural resource and metal mining industries such as natural gas, mica and gold, for $1,000,000, and refinancing and reorganization plans for another million out of the total of $8,000,000. The Commission stated that one company proposes to mine and mill mica and its by-products in Alabama. Another corporation will engage in the operation and sale of machines, operating devices and charts for measuring human effort. The list of statements filed for registration follows: Production Control Machines Corp (2-560), Wilmington, Del., a Delaware corporation engaged in the rental, sale and operation of machines, operating devices and charts for measuring human effort, proposes to issue 100.000 shares of common stock in the amount of $500,000. Among officers are: Charles E. Bedeaux. President, New York; Van Lear Woodward, Treasurer and General Manager, New York, and George Link, Jr., Vice-Counsel and Secretary, New York. Continental Distillers & Importers Corp. (2-561). New York City, a Delaware corporation proposing to engage in distilling, purchasing and warehousing of liquors, having been qualified to do business in Now York, New Jersey and Delaware. The company proposes to issue 245,000 shares of common stock at an aggregate price not exceeding $3,307,500. The underwriter is Lisman Corp., 42 Broadway, Now York. Among officers are: Daniel Reich, President; James E. Beggs, Secretary-Treasurer, both of Now York, and Paul J. Robertson, Assistant Secretary, Washington, D. C. Tonawanqa Brewing Corp. (2-562), Tonlwan4a, N. Y., a New York corporation manufacturing and selling beer and other malt products, proposes to Issue 81,497 shares of capital stock at a total aggregate price not to exceed $264,875. Underwriters are: C. H. Berets & Co., Inc„ 120 Wall St., New York, and A. F. Hatch & Co., Inc., 76 Beaver St., New York City. Among officers are: Frank X. Schwab. President, Buffalo, and Carl H. Berets. Secretary-Treasurer, New York. (Statement withdrawn Jan. 5 1934.) Mica Corp. (2-563), Chicago, a Delaware corporation owning property in Alabama and engaged in mining, milling and distribution of mica and its by-products. The company proposes to issue 5,000 shares of $25 par value preferred stock, fully participating and convertible in an aggregate of $125,000. the proceeds raised to be used in the purchase of machinery and for working capital. Among officers are: J. F. Stefan, President; John M. Zeesman, Vice-President; Ole Jensen, Treasurer, and Nets Olsen, Secretary, all of Chicago. Kentucky Consolidated Gas Co., Inc. (2-564), Baltimore, a Delaware corporation engaged in the production and sale of natural gas and its by-products, owning properties in Kentucky and Maryland and qualified to do business in Delaware. Maryland and Kentucky. The company proposes to issue 1,000,000 shares of $1 par value common voting stock. Of the capital to be raised, $250,000 is to be applied to notes and other debts;$300,000 to develop additional gas wells;$200,000 for working capital, a total of $750,000. Among officers are: Harry Loaberry, President; Henry L. Porter. Secretary, and Anna Arrowood, Treasurer, all of Baltimore. The underwriter is: K.D.Johnson & Co., 67 Wail St., Now York. Arizona Gold Manganese Co. (2-565), Phoenix, Any., an Arizona corporation proposing to develop and operate a group of 10 mining claims in the Alamo mining district of Yuma County, Arizona, issuing $120,000 Jan. 20 1934 worth of preferred and common stock. Among officers are: John A. Provorse, President, Vicksburg, Ariz.; P. S. Moyer, Vice-President. Portland, Ore., and E. H. Randall, Secretary-Treasurer, Condon, Ore. Newark Mortgage Co. (2-566). Newark, N. J., a New *Jersey corporation formed to take over and liquidate assets now owned by Clinton Trust Co. of Newark in order to reopen the latter institution which is now restricted. The company expects to issue participation certificates in the amount of $936,742.88. Officers of the Clinton Trust Co. will serve without pay in their capacities for this company. They are: Charles G. Bauer, President; William W. Brown, Jr., Treasurer, and Fred Herrigel, Jr., Secretary. Beverages, Inc. (2-567). Boston. a Delaware corporation proposing to make investments or to participate in undertakings in the beverage industry and industries allied thereto. The company expects to issue common stock and subscription warrants in the following amounts: All or such part of 529.846 shares of common capital stock and 530,864 subscription warrants as shall be sold for not exceeding $2,700,000, being the unsold portion of 600,000 shares of stock and 600,000 warrants previously offered. An additional 600,000 shares of stock 'are reserved for issue upon the exercise of the warrants. When and if all subscription warrants are exercised, the 600,000 shares reserved for this purpose will have been sold for $1,800,000. The underwriters are: F. L. Putnam & Co., Inc., Boston; Dwelly, Pearce & Co., Inc.. New York City. and Hovey, Phillips & Co., Jersey City. Officers are: Henry S. Thompson, President. Concord, Mass.; Henry E. Kingman, Vice-President and Treasurer, Newton, Mass., and Joseph L. S. Barton, Assistant Treasurer, Winchester, Mass. Down Town Realty Co. (2-568), Milwaukee, a Wisconsin corporation owning and operating an apartment building, proposing to issue in pursuance of a plan of readjustment or reorganization, first mortgage bonds of $216,000 and debenture notes. $6,480. Arthur L. Richards is President and Harold A. Richards, Secretary-Treasurer, both of Milwaukee. Down Town Realty Co. (2-569), Milwaukee, a Wisconsin corporation owning and operating an apartment building, proposing to issue in pursuance of a plan of readjustment or reorganization, second mortgage bonds of $55,400 and debenture notes. $1,662. Arthur L. Richards is President and Harold A. Richards, Secretary-Treasurer, both of Milwaukee. Five security issues totaling $3,000,000 were announced by the Federal Trade Commission on Jan. 13 as having been filed for registration under the Securities Act. All but $270,000 is for new capital, including an aeroplane builder, textile and mining companies. The $270,000 is for refinancing of a realty project. The list follows: Soaring Plane Corp. (2-570), Los Angeles, a California corporation proposing to manufacture, buy, sell and assemble aeroplanes, using a patented wing, issuing 15,000 shares of common stock at $1 a share. Among officers are: Cornelius Ramakers, President; John Bruce, Vice-President, and Thomas C. Eddy, Secretary-Treasurer, all of Los Angeles. Queen City Textile Corp. (2-571). Allentown, Pa., a Pennsylvania corporation manufacturing women's wearing apparel and other textiles, proposing to issue $500,000 worth of 6% cumulative preferred stock, the proceeds to be used as follows: Machinery purchases, $140,000; working capital, $360,000. Officers are: Arthur G. Schmidt, Nazareth, Pa., Chairman of the Board; Victor R. Schmidt, Emaus, Pa.. President and Treasurer; Max W. Winkler. Bethlehem, Pa., Vice-President; Calvin H. Hartzell, Nazareth, Pa., Secretary, and William W. Degen, Bethlehem, Pa., Comptroller. Appleton Building Co. (2-572). Milwaukee. a Wisconsin corporation dealing in real estate and particularly holding title and operating premises known as Rio Theatre, Appleton, Wis., proposing to issue first mortgage bonds of an authorized amount of $245.000; balance now outstanding, $236,600; and second mortgage issue of an authorized amount of $60,000: balance outstanding, $33,000. Person authorized to receive notices is J. H. Stillman, 620 F,. Homer St„ Milwaukee, Tiger Placers Co. (2-573), Tiger. Summit County, Colo., a Colorado corporation engaged in placer mining and qualified to sell its stock in Colorado, Illinois and Massachusetts, proposes to issue $50,000 worth of preferred capital stock, the proceeds to be used for company purposes. Officers are: John A. Traylor, Tiger, Colo., President; Marshall Ware, Galena, Ill., Vice-President, and T. E. Allen, Tiger. Colo., Secretary-Treasurer. Cole Cold Mines. Ltd. (2-574). Pipestone Bay, Red Lake, Ont., an Ontario corporation engaged in mining gold ores and owning property in the Province of Ontario, proposes to issue 2,162,249 shares of stock in the amount of $2,310,816.98. The underwriter is John Y. Cole, Jr., Plpestone Bay, Red Lake, Ontario, and 277 Park Ave., New York City. The officers are: John Y. Cole. Jr.. President and Treasurer; Cicily Cole, Now York, Secretary, and William Exton, Jr., New York, Vice-President. Five and one-half million dollars' worth of securities covering new capital in mining, liquor and pharmaceutical projects and a reorganization plan in the cleaning and dyeing industry, were made public Jan. 14 by the Federal Trade Commission. We give the list herewith: Abbe Gold Mining Corp. (2-575). Los Angeles, Calif., and Carson City. Nev., a Nevada corporation organized to mine gold, silver and other ores, proposes to issue 4.000.000 shares at $1 par value each in exchange for the properties; 1,000,000 shares to be offered the public at $1.12% a share, which were sold by the company at 85 cents a share to the underwriters, Security Loan & Investment Corp., Carson City, Nov. Total aggregate proceeds of the issue are not to exceed $5,125,000. Among officers are: Max E. Socha, Los Angeles, President; Thomas W. Cochran, Hollywood, Treasurer, and James C. Brazell. Secretary. Gallatin Brewing Co. (2-576), Bozeman, Mont., engaged in manufacturing and selling beer and liquors, proposes issuing $50,000 bonds secured by deed of trust. Underwriters are Router Co., Dayton, Ohio, receiving a commission of $2,500. Among officers are: John W. Fraser, Bozeman, Mont., President. and Herman Lehrkind, Missoula. Mont., Secretary. Fuller Cleaning & Dyeing Co. (2-577). Cleveland, calling for deposits of $278,000, principal amount now outstanding of first mortgage real estate serial gold bonds, in a proposed reorganization or readjustment of the Fuller Cleaning & Dyeing Co. Officers of the company are: William M. Theobald, President and Treasurer, and A. W. Hinchcliffe, Secretary, both of Cleveland. Tam paz Sales Corp. (2-578). Denver, a Colorado corporation manufacturing and selling feminine hygiene products and kindred articles, proposes to issue preferred stock and class A and class B common stock in the amount of $42,985. Among officers are: Gertrude S. Tenderich. President; L. Bernard Davis, Secretary-Treasurer, and James V. Calhoun, Vice-President, all of Denver. Eagle Gold & Platinum Mining Co., Inc. (2-579). Vancouver, British Columbia, Can., and Wilmington. Del., a Delaware corporation proposing Volume 138 Financial Chronicle to do a general business of developing mines, particularly production of gold and platinum, the mining claims being located in British Columbia. The company expects to issue 125,000 shares of common stock at a total aggregate price of $187,500. The underwriter is W. M. Harvey, 25 Broad St., New York, who is to receive a discount or commission of 33 1-3%. Among officers are: George W. Vance, Vancouver, B. C., President; Norman McCormick, Tulameen, B. C., Vice-President, and Etna M. Morgan, Vancouver, B. C., Secretary-Treasurer. In making public the above lists the Commission said: In no case does the act of filing with the Commission give to a security the Commission's approval or indicate that the Commission has Passed on the merits of an Issue or that the registration statement itself is correct. The last previous lists were given in our issue of Jan. 13, page 263. Pennsylvania Railroad Notifies Its Employees that They May Join, or Refuse to Join, Any Labor Organization. The Pennsylvania Railroad on Jan. 18 notified its employees that they are free to join or not to join any labor organization they desire. This action was taken in response to a request by Joseph B. Eastman, Federal Co-ordinator of Transportation, addressed to the regional co-ordinating committees, that all railroad employees be advised to this effect by appropriate notice posted on bulletin boards and distributed generally and that they also be advised that they will in no way be penalized or prejudiced by the management because of their choice. The announcement by the Pennsylvania Railroad read as follows: TO ALL EMPLOYEES— Statements have been made and are now being circulated, that Federal statutes now effective outlaw associations of employees on single railroads or railroad systems. These statements are not true. In order that there may be no misunderstanding as to the policy of this company, this notice is posted as advice to all employees of the company, that they are free to join or not to join any labor organization, and they will in no way be penalized or prejudiced by the management of this company because of their choice. The policy of this company in this respect has not changed. J. F. DEASY, Vice-President. In Charge of Operation. S443 Loans for Distributions to Depositors. The amount of loans authorized and commitments outstanding includes loans aggregating $589,048,898 to release frozen deposits by ratable distribution to depositors. Allocations. The Corporation is required, or may be required, under the provisions of existing statutes, to allocate sums in the amount of $1,625.000,000 to other Government agencies and for the relief of destitution. This sum is made up of the following: Amount Allocated by Congress. Secretary of the Treasury to pay for capital of Federal Home Loan Banks $125,000,000.00 Capital of Home Owners' Loan Corporation. 200,000,000.00 Farm Loan Commissioner to make loans— To farmers 200,000,000.00 To Joint Stock Land banks 100.000,000.00 Secretary of Agriculture to make crop loans. _ _ 200,000,000.00 Paid to Secretary of Agriculture (net) Re-allocated as capital of Regional Agricultural Credit Corporations Re-allocated to Farm Credit Administration_ 3800.000,000.00 $614,546,221.39 $1,625,000,000.00 $991,391,921.39 Funds Received— From United States Treasury: Subscription to the Corporation's cap.stock_ $500,000,000.00 Purchase by the U. S. Treasury of the Cor2,350,000,000.00 poration's notes $2.850,C00,000.00 From sale of the Corporation's notes to banks whose preferred stock, capital notes, or debentures were purchased by the Corporation From repayments: Of loans (Including 368,416.62 on loans se81,030,631.194.68 cured by preferred stock of banks) 970,085.00 Of relief advances (1932 Act) 87,300.00 Of preferred stock (retirement) 101,299,666.67 1,031,688,579.68 470,502,896.31 From operating Income—Interest Dividends on preferred stock 448,451.16 70.951,347.47 20,309,506.06 From miscell.sources, incl. collections unallocated at end of year_ 84,074,249,099.88 Total In addition to the above, the Corporation has notes outstanding for which it accepted gold in payment in the amount of $78.726,187.37. Disbursed for expenses of Regional Agricultural Credit Corporations (subsequent to May 26 1933) Disbursed for expenses: Interest paid to Secretary of Treasury on $54,083,630.18 Corporation's notes 14,571,163.07 Operating expenses of the Corporation 44.500.000.00 40.500,000.00 3376.845.700.00 The order conforms with the requirements already in effect on member banks of the Federal Reserve System. It extends this prohibition against interest payment on demand deposits to non-member banks which now have deposits up to $2,500 insured by the Federal Corp. The Corporation said: "This regulation provides that no bank may pay interest on a demand deposit or after a deposit becomes payable on demand. Demand deposits are those which are payable on less than 30 days' demand or within 30 days from date of deposit. "The exceptions to this rule are (a) deposits payable only at an office of a bank not located in the United States or in the District of Columbia, (b) deposits made by mutual savings banks, (c) deposits of public funds where payment of interest is required under State law and (d) deposits made by contract entered into heretofore unless that contract contains an option permitting the bank to conform with these regulations." $4,959,719,826.57 115,000,000.00 3299,984,999.00 314,561,222.39 Funds Disbursed. $2,749,227,461.26 Disbursed for loans Disbursed for purchase of preferred stock, capi249.988,116.67 tal notes and debentures of banks SUMMARY OF THE ACTIVITIES OF THE RECONSTRUCTION FINANCE CORPORATION FROM FEB. 2 1932 TO DEC. 31 1933. Authorizations and Commitments. Amount Authorized Number of Number of and Commitments Loans or Outstanding. Purchases. InstUutions, Loans secured by preferred stock of banks and insurance companies. 215 345,307,500.00 215 Loans for other purposes 8,326 4,097.600,476.57 15.369 Purchases of preferred stock of 2,235 banks ($474,709,200) and purchases of capital notes and debentures 01 2,309 banks($342,102,650) 4,544 816,811.850.00 4,544 80.000.000.00 2,600.000.00 3300,000,000.00 500,000,000.00 Payment by Insured Banks of Demand Deposits— Interest Barred by Federal Deposit Insurance Company. Regulations prohibiting insured banks from paying interest on demand deposits were issued on Jan. 19 by the Deposit Insurance Corp., according to Associated Press dispatches from Washington Jan. 19, which added: Report of RFC Covering Activities From Feb. 2 1932 to Dec. 31 1933—Loans Authorized and Commitments Outstanding Totaled $4,959,719,827—$2,999,215,578 Disbursed During Period—Repayments Totaled $1,030,718,495. The Reconstruction Finance Corporation authorized and had commitments outstanding of $4,959,719,826.57 during the period from Feb. 2 1932, when it began operation, to Dec. 31 1933, it is noted in a report covering that period issued Jan. 10. $323,171,409.92 of this amount was canceled, $2,999,215,577.93 was actually disbursed, and $1,030,718,494.68 was repaid. This leaves a balance of $1,968,497,083.25 outstanding. Total disbursements by the Corporation, the report shows, which include those to the various Government agencies as provided by existing statutes, for relief of distress, for interest on the Corporation's notes, operating expenses of the Corporation, &c., amounted to $4,064,574,581.05. Cash on deposit with the Treasury of the United States as of Dec. 31 1933 totaled $9,674,518.83. The report follows: $75,245,700.00 19,000,000.000 3825,000,000.00 For relief—Under 1932 Relief Act Under 1933 Relief Act Total allocations and relief Amount Disbursed. Disbursed for allocations: For relief of dLstress To other Government agencies $2,999,215,577.93 $614,546,221.39 376.845,700.00 991,391.921.39 33,990.607,499.32 3,406,374.35 68,654,793.25 Miscellaneous disbursements (including advances for care and preservation of collateral, furniture and equipment. &c.) 1,9(15,914.13 $4,064,574,581.05 Cash on deposit with Treasury of U.S., Dec.31 1933 $9,674,518.83 Earnings. Income—Interest earned Dividends on preferred stock Other Expense: Interest on notes issued: To Secretary of Treasury To banks Other Interest Operating expenses $112,136,563.52 448,451.16 2,516.93 $112,587,531.61 558,786,369.88 98,744.05 27,237.88 14,659,813.16 Earnings above interest and expenses 73,572.164.97 $39,015,366.64 No reserves have been set up to cover losses. Loans to Railroads and Railroad Receivers. (Included in total authorizations and commitments, above.) $411,845,678.00 Authorized (125 loans to 67 railroads) 4,083,532.06 Canceled or withdrawn $407,762,145.94 Disbursed Repaid (five roads paid in full, $44,184,298.94) $394,094,258.49 57.014.636.60 $337,079,621.89 Aggregate market or appraised value of all collateral $533,995,965.00 While all railroad loans were authorized by the Inter-State Commerce Commission and the collateral certified as fully and adequately securing the loans, there appears to be at this time a deficiency in the present market or appraised value of collateral securing loans to 14 roads. Two roads, the Central of Georgia, and the Chicago North Shore & Milwaukee, have gone into receivership, and four roads, the Missouri Pacific, St. Louis & San Francisco, Chicago & Eastern Illinois and Chicago Rock Island & Pacific, have gone into bankruptcy since the loans were made. These appear to be inadequately secured at this time. Also the collateral securing loans to eight other carriers appears somewhat deficient on the basis of present market and estimated value of collateral not readily marketable. Our Railroad Division estimates the total deficiency of the 14 roads involved to be a little less than $30,000,000.00. Cancellations of Authorizations, Loans authorized for all purposes but canceled before disbursement Preferred stock, capital notes and debentures Total $320,596,409.92 2,575.000.00 $323,171,409.92 Financial Chronicle 444 Jan. 20 1934 AUTHORIZATIONS AND COMMITMENTS,DISBURSEMENTS, AND REPAYMENTS BY CLASSES FROM FEB. 2 1932 THROUGH DEC. 31 1933. Loans. To banks and trust cos. (Incl. loans for distribu Don to depositors in closed banks) Credit Unions Building and Loan associations Insurance companies Federal Land banks Federal Intermediate Credit banks Joint Stock Land banks Livestock Credit corporations Mortgage Loan companies Regional Agric. Credit corporations Other Agricultural Credit corporations Railroads (including receivers) Processors or distributors for payment of pr ceasing taxes State funds created to insure deposits of pubil moneys To aid in financing self-liquidating constructioll projects (including loans for the repair and reconstruction of property damaged by earthquake. fire, tornado and cyclone in 1933) To aid in financing the sale of agricultural surpluses in foreign markets To finance the carrying and orderly marketing o agricultural commodities and livestock produced in the United States To Secretary of Agriculture to purchase cotton_ _ To drainage, levee and irrigation districts Secured by preferred stock of: Insurance companies Banks and trust companies Total loans Preferred stock Capital notes Debentures Total pref. stock, cap. notes et debentures — Total loans, pref. stock, cap. notes & debs No. of Amt. Authorized No. of Loans & Inoti- .Commitments Outstanding. Purchases :Talons. $ 1,853,062,577.65 621,001.00 121,511,512.29 100,528,867.51 200,323.000.00 9.250.000.00 21,103,172.68 14,264,402.85 374,898,975.05 160.777,463.92 6,579,485.29 411,845,678.00 Authorizations Withdrawn or Canceled. Amount Disbursed. Amount. 5 $ 5 Repayments Per Cent. Balance Outstandino. $ 11,647 8 1,201 194 47 8 50 154 321 1,032 241 125 6,457 6 1,004 128 12 8 24 20 260 12 19 67 5 5 24,447.83 7,333.69 _-_ 7,333.69 1 1 5,887,715.88 5,887,715.88 74.750.14 1.2 5,812,965.74 190 182 230,764.364.28 63,603,409.66 152,175.00 0.2 63,451,234.66 5 3 52,880,542.80 7,142,728.38 233,692.82 3.2 6,909,035.56 84 1 55 67 1 55 513,907,133.30 3,500.000.00 16,870,286.24 3,332,798.89 4.6 3,300,000.00 100.0 68,110,121.66 5 210 4 206 15,375,000.00 29,932,350.00 15,584 8,541 4,142,907,976.57 2,235 20 2,289 2,235 20 2,289 474,709,200.00 135,800,000.00 206,302,650.00 4,544 4,544 208,977.690.85 1,429,580,716.15 710.659,693.58 49.7 42,113.59 578,887.41 61,902.64 10.6 5,405,402.98 113,050,554.75 45,999,862.11 40.6 5,701,226.31 87,682,033.52 25,521,689.58 29.1 7,700,000.CC 142.118,000.00-9,250,000.00 9,250,000.00 100.6 2,351,299.74 14.948,119.76 757,164.46 5.0 1,386,372.07 12.568,733.05 9,936,127.87 79.0 10,970,367.79 212,835,142.58 36.305,542.80 17.0 2,989,467.16 155,154,213.72 124,525,972.68 80.2 316,620.82 5,185,638.57 3,436,768.89 66.2 4,083,532.06 394,094,258.49 57,014,636.60 14.4 718,921,022.57 516,984.77 67,050,692.64 62,160,343.94 142,118,000.0C 14.190,955.3C 2,632,605.18 176,529,599.78 30,628,241.04 1,748,869.68 337,079,621.89 • 816,811,850.00 4,959,719,826.57 14,413,487.57 54,510,828.98 200,000.00 71,442,920.55 3,300,000.00 2,413,955.10 1,548,000.00 4,025,000.00 14,358,100.00 2,413.955.10 68,410.62 0.4 4,025,000.00 14,289,683,38 320,596,409.92 2,749,227,461.26 1,030,631,194.68 37.4 1,718,596,266.58 87,300.00 -— 35,000.00 132,998,116.67 79,800,000.00 37,190,000.00 132,910,816.67 79,8C0,000.00 37,190,000.00 2,575,000.00 249.988,116.67 87,300.00 ---- 249,900,816.67 323,171.409.92 2,999,215.577.93 1,030.718,494.68 -- - - 1,968,497,083.25 2,540,000.00 capital notes and debentures 81.636,548,416.65 Balance undlabursed on loans preferred stock and -----------------------------------------------------------------------------------------633,608,078.61 Balance undisbursed on allocations by Congress ----------------Total Bankers Trust Co. of New York Reduces German Commitments—President Colt in Annual Report Indicates Status of Foreign Business—Reduction in Book Value of Company's Security Holdings. The annual report of S. Sloan Colt, President of the Bankers' Trust Co. of New York, to the stockholders, at their annual meeting on Jan. 11, to which brief reference was made in our issue of Jan. 13, page 267, referred to the status of the company's foreign business as follows: At the inception of the German Stillhalte, in July 1931, our total commitments in Germany amounted to $27,320,048.87, which figure has been reduced as of Dec. 30 1933 to $11,961,051.29, made up as follows: $5,709,948.88 short-term German Government credit, $993,281.25 State of Bavaria credit, and $5,257,821.16 commitments under the German Stillhalte. The loss in the collection of $15,358,997.58 amounted to $2,373,292.34, which was charged to contingency fund in 1933. The commitments outstanding in Austria and Hungary, amounting to 81,018,523.18 and $654,567.67, respectively, were fully reserved against in prior years and now stand on our books at a net figure of less than $10,000. The present foreign business of the company consists in financing the foreign operations of American industrial and commercial concerns and in financing the export of commodities and manufactured goods of this country and imports to this country. The London office, which at the end of the current year had deposits of approximately $23,000,000, contributed a substantial net profit to the company in 1933. In our item of a weak ago we noted that the operating earnings of the company in 1933 were $10,938,330, from which was paid the usual dividend of $7,500,000 at the rate of $3 a share. Mr. Colt also referred to the issuance of capital notes to the Reconstruction Finance Corporation, and to the fact that the institution had joined the temporary insurance fund. Portions of the report not given in our item of a week ago follow: The abnormal conditions of the past few years have borne heavily upon the banking business, and have naturally aroused in the minds of stockholders of banks an unusual interest in the operations of their institutions. It is with this thought in mind that the management of Bankers' Trust Co. has prepared this report of its recent operations and present condition. Our recent statement of condition, as of Dec. 30 1933, was widely published in this country and in Europe shortly after the first of the year. In the near future a copy of this report, together with the company's balance sheet, will be printed and distributed to each stockholder of the company. It may be interesting to note in this connection that the number of our stockholders has grown from 15,296 on Dec. 31 1929 to 19,571 on Dec. 30 1933. During the entire period of the depression the stockholders have received each year the name dividend per share from Bankers' Trust Co. as they received in the year 1929. We hav c received and welcomed many communications during the year from interested stockholders and have distributed to them, by letter and pamphlet, communications which we consider of mutual interest. We expect to continue this policy. I want to supplement briefly the story which is told by the figures themselves, with a few comments which I believe will be of general interest. Capital Funds. It will be noted that the capital of $25,000,000 and surplus of $50,000,000 are unchanged from the statement of the previous year, and that undivided profits and contingency fund are shown at $10,030,598.90 and $15,849,892,45, respectively. In December 1931 the management, anticipating further unsettled business conditions, established a contingency fund of $12,000,000 set aside out of undivided profits. During the year 1932 $7,000,000 of this fund was used to set up specific reserves. In April 1933 contingency fund was increased to $20,000,000 by a similar transfer from undivided profits of $15,000,000, reducing undivided profits to $12,202,652.70 at that time. In $2,270,156,495.26 our judgment the reserves set aside in contingency fund are ample to meet any contingencies likely to arise out of the present business conditions. . . . Operating Expenses. Times such as we have experienced during the past few years require a constant adjustment of expenses to meet changing conditions and sharply decreased operations in some of the principal departments in the bank. Every effort has been made to bring about these necessary adjustments with the consideration for the human problem involved. In 1930 our operating expenses, excluding taxes, were $11,640,000. In 1931 they had been reduced to $10,080,000, and for the year 1933 amounted to $8,423,000. This represents a reduction during the past three years of approximately $3,200,000, or over 27%. Capital Note. It will be observ ed that we issued our Capital Note to the Reconstruction Finance Corporation in the amount of $5,000,000. This note is dated Dec. 15 1933, and is payable July 31 1934 or earlier at our option or at the option of the Reconstruction Finance Corporation. This action was taken in cooperation with the Government's policy to strengthen generally the capital structure of banks throughout the country. Investments. It has been a consistent policy of the company to appraise its security holdings at conservative market value, and in conformity therewith $2,500,000 was charged to the above mentioned contingency fund of $20,000,000 during the year to reduce the book value of the company's holdings of State and municipal bonds. United States Government securities having a maturity of five years or less are valued, and carried on the books, at par. Adjustments resulting from the purchase and sale of these bonds at a discount or premium are likewise reflected in the above mentioned contingency fund. . . Banking Premises. In January 1931, after careful study, it was decided to take advantage of lowered building coats to modernize and largely rebuild our main banking quarters at Wall and Nassau Streets. This building program was completed during 1933 at a total cost of $10,155,569.24. Of this amount, $1,395,472.10 was charged against current operations and $8,760,097.14 was added to the book value of our bank premises. At the end of 1933 our Wall Street real estate holdings were written down $4,959,374.34 and our bank premises at Fifty-seventh Street were written down $948,276.88. These two writedowns, aggregating $5,907,651.22, and charged to undivided profits, reduced the book salue of our bank premises to $20,682,194.53. Although our recently completed Wall Street building is at present only partly rented, it is currently earning sufficient to pay all operating expenses, taxes and depreciation, plus a slight return on the investment. Deposits. The deposits on Dec. 30 1933 amounted to $611,725,753.74 as compared to $621,867,430.91 a year ago, which included the deposits of our Paris office, which was closed during the past year and the balance of our A. B. A. travel cheque department also discontinued in 1933. These two deposit items have decreased $20,685,151 during the year. Securities Business. The securities business of the company was formerly conducted through its subsidiary, Bankers' Co. of New York. Over two years ago, In October 1931, Bankers' Co. was dissolved, and the securities operations now carried on through the bond department consist principally in the purchase and sale of United States Government, State and municipal securities, and in the execution of orders for customers of the Trust Company. Fiduciary Departments. Unsettled times always throw heavy additional burdens upon the fiduciary departments of banks. The complete unsettlement of values, both in the security markets and in the real estate field, has called for extraordinary efforts to protect the interests of the beneficiaries for whom it is our duty to act. To meet this responsibility, we have added largely to the personnel of our mortgage and real estate departments and our trust investment department. The results have justified the added expenses Involved and are In keeping with the long record of service which the fiduciary departments Volume 138 Financial Chronicle of Bankers' Trust Co. have established. Notwithstanding the additional expenses involved and the reduced income, the operations of the fiduciary departments as a whole are still on a profitable basis and we believe the good will created in these trying years will prove of benefit to the Company and to its stockholders when more normal times return. Group Insurance and Pension Fund. Our employees are protected by generous pension fund and group insurance programs. The pension fund has been operating since 1913, and at the close of the year the number participating in it was 1,765. Our group insurance was commenced in 1926. At the end of 1933, 2,066 employees were insured under it for an aggregate amount of $5,898,650, which is carried in a large insurance company. Banking Reform. The Banking Act of 1933, which was passed on June 16 last, provided for a number of modifications in banking practice. It is too early to judge the ultimate effect of many of these provisions, but with regard to one of them It is appropriate to make a few observations at this time. This has to do with the insurance or guaranty of bank deposits which was provided in that Act. Under this section there was first of all provided a temporary insurance fund which went into actual operation on Jan. 1 of the current year. This company has joined the temporary insurance fund as provided by law. This temporary plan guarantees for a period of six months the account of each depositor up to $2,500 and limits the assessments on operating banks during that period to a maximum of 1% of their respective insured deposits. We are giving full support and co-operation to this temporary insurance plan as an emergency measure intended to restore public confidence. The permanent insurance plan, which is also provided for in the Banking Act of 1933, presents a different problem. In its present form this plan, which becomes effective July 1 1934, guarantees in full all deposits up to $10,000, 75% of deposits from $10,000 to $50,000, and 50% of deposits over $50,000. The assessments on operating banks to cover losses under this plan are based on total deposits rather than insured deposits, and are unlimited in amount. In other words, any bank which joins this plan must assume unlimited joint liability for failures of other banks in the United States, wherever and whenever they may occur, and for whatever reason. If the permanent insurance plan is not modified, a serious decision will be presented for determination before July 1 1934 as to the proper course to pursue. In order that you may understand more fully the implications of the pertnanent plan we urge again that you read the recent bulletin on the "Guaranty of Bank Deposits," issued by the Association of Reserve City Bankers, copies of which wer mailed to our stockholders in November. Additional copies of this bulletin will be mailed to stockholders upon request. The Government has greatly strengthened the banking system by rebuilding the capital structure of some 4,500 institutions to the extent of over $800,000,000. In order to take full advantage of the work already accomplished, however, it is necessary to devote our efforts toward a more fundamental and permanent strengthening of the banking structure, and it goes without saying that this institution stands ready to co-operate in all efforts to provide a banking system of unquestioned strength and public usefulness. Confidence Can Only Be Restored by Stabilization of Dollar and Return to Gold Standard to Percy H. Johnston of Chemical Bank According &TrustCo.— In Annual Report to Stockholders Asserts Federal Deposit Insurance Law Puts Premium on Unsound Banking—Says Banking Code Was Forced on Larger Banks by Small Banks—Expresses Belief That Chemical Has No Liability to Depositors Closed Harriman National Bank & Trust Co. of Stating that "we view with apprehension the mounting peace-time increase in the Governmental debt," Percy H. Johnston, President of the Chemical Bank & Trust Co. of New York says that "no sustained prosperity can obtain without economy in Government and a balanced budget." In his annual report to the shareholders of the bank on Jan. 17, Mr. Johnston also says "in our opinion confidence can be restored only by stabilization of the dollar and a return to the gold standard." The sale by the bank of $5,000,000 capital notes to the Reconstruction Finance Corporation is referred to in the report, which describes "the most serious problem confronting your bank," "the permament guarantee of deposits law that becomes effective July 1 1934." Mr. Johnston declares that "the law puts a premium on unsound banking and is unfair to well -managed banks." He urges that the shareholders appeal to Congressmen and Senators for a modification of the law. In response to a question, it was stated in the New York "Times," Mr. Johnston said he did not think the Chemical had any liability with respect to the Harriman National Bank, the closed Clearing House bank on behalf of which the Government is now suing all Clearing House members and a group of former Clearing House officials. Mr. Johnston is quoted in the "Times" as follows: Doubts Liability for Harriman. "We knew nothing about the Harriman situation, or about Mr. Cooper being sent up there until months after he went up," he said, adding that counsel for the bank had informed directors that only the shareholders themselves could incur a liability for the deposits of the Harriman. Henry E. Cooper, former President and later Conservator of the Harriman, took charge of the institution in 1932 in connection with an alleged understanding that the Clearing House would look after the situation. The same paper in reporting that Mr. Johnston voiced his opposition to the bankers' code, thus indicated his views: Declaring that the last thing the banks wanted was to have a Government code forced upon them, Mr. Johnson asserted that the regulations imposing a metered system of service charges had been "forced upon us by the Government and the small banks." He explained that he knew whereof he spoke, having been a member of the Code Committee of the American Bankers' Association. 445 Mr. Johnston's report follows in large part: The operations of the Chemical Bank & Trust Co. during 1933, which was its 110th year, were conducted along its usual conservative lines and the principal objective was—conservation of principal. The net operating profits were sufficient, after making provision for losses, reserves and the usual dividend, to increase our undivided profit account 81,077,825.91. The year 1933 will unquestionably be recorded in history as a year of unprecedented and transcending change—social and economic—resulting in a transformation nothing short of revolutionary, which reaches into every phase of the life of the nation and which affects even the form and character of the government itself. The year recorded: 1. A complete collapse of the banking system of the country. 2. A decline of approximately 40% in the international value of the currency of the country. 3. The abandonment by the United States of the gold standard and the repudiation of contracts expressed in terms of gold. 4. The renunciation of constitutional powers on the part of Congress and the assumption of enormously increased authority on the partlof the Executive. 5. The regimentation of business under strict governmental regulation, If not control. 6. The subsidizing of the farmer through using public funds to grant bonuses to agricultural producers as a reward for entering into agreements to curtail production. 7. The effort to increase the consumption of the country through reemployment of those unemployed by creating employment through the construction of public works financed by the Government. 8. The adoption on the part of the Government of a plan to raise artificially the prices of commodities by deliberately depreciating the currency and, further, the announced intention to adopt whatever measures may be found to be necessary to fulfill the promise of higher commodity prices. 9. Substantially improved business conditions in virtually every country of the world. 10. An indicated deficit in the Federal budget of enormous proportions and an increase in the public debt of an amount without precedent or Parallel in the peace time history of the nation. We view with apprehension the mounting peace time increase in the governmental debt. No sustained prosperity can obtain without economy in Government and a balanced budget. In our opinion, confidence can be restored only by stabilization of the dollar and a return to the gold standard. The founders of our nation followed the principle that the people should support the Government and not the Government the people. We are too prone to run to the Government for the cure for every ill. We should return to the principles of our forefathers and pull ourselves out of our difficulties by hard work, economy. courage and self-reliance. We desire again to state that we must abandon the fallacy that a small percentage of the population can supply the money to operate the Government. Let us hope that we will soon join with the leading nations of the world In a return to the gold standard and in a general lowering of the tariff barriers which at the present time so greatly impede commerce between nations. There has occurred in this country a substantial Improvement in business and there exists a decidedly more optimistic feeling as a result. To what extent this improvement rests upon solid foundations and will prove lasting is known only to the prophets of to-day and the historians of the future. Congress at its last session made some changes in the banking laws. The following are of especial importance to us: 1. The so-called "temporary guarantee of deposits up to 82.500." which is for the first half of 1934. It is compulsory for every member of the Federal Reserve System (we are a member) to participate in this guarantee fund. This we have done. 2. The abolition of securities affiliates. In 1932 you approved the merger of the Chemical Securities Corp. with the Bank. This merger was completed in January 1933 at which time the capital stock of the company was reduced $1,000,000 by the cancellation of 100,000.shares which were received from the Securities Corp.: the $1,000,000 reduction of the capital account being transferred to the undivided profit account. 3. The number of directors has been limited to 25. We now have 24. 4. Persons Interested in issuing or selling securities cannot be members of the board of directors without the approval of the Federal Reserve Board. We sold $5,000,000 capital notes in December to the RFC, which are payable July 31 1934, bearing interest at the rate of 4%. As we have sufficient capital for the requirements of our business, we sold the notes for the sole purpose of co-operating with the Federal Government. The most serious problem confronting your bank is the permanent Guarantee of Deposits Law that becomes effective July 1 1934. If your Institution is to remain a member of the Federal Reserve System it must subject itself to this Law. Had this Law been in effect during the past five years, more than one-half of this company's capital funds would have been dissipated to pay the losses of other banks. The Law puts a premium on unsound banking and is unfair to well managed banks. I strongly urge each and every shareholder of this Institution to plead with his Congressmen and Senators that it be modified and that the assessments be limited and fixed for each year and not remain unlimited as in the present Law. The financial statement following this report shows the condition of the bank at the close of business Dec. 30 1933 and discloses a strong and liquid position. The deposits as of Dec. 30 1933 were larger than at the corresponding date in 1932. For the year 1933 deposits averaged 837,868.000 more than those in the year 1932. After charging to earnings account the expenses, charging off losses and setting up tax and other reserves, the disposition of the balance of the year's earnings is shown below: Dividends amounting to 18% on the stock In the bank S3,800,000.00 Special reserve for contingencies 1,652.691.97 Amortization of premiums on U. S. securities .1,517,955.10 Reduction in book value of banking houses 300,000.00 Reserved for temporary Federal Deposit Insurance x135,000.00 Pensions paid to 23 former employees 57.116.98 Added to undivided profits 1,077,825.91 $8,340,489.96 • Amortization charge is for the purpose of reducing bonds to par at the earliest callable date, or, at maturity. a The payment of 4 of 1% on our insurable deposits amounted to $66.089.25. This amount was paid on Dec. 22 1933. There are at present 1,182 members on our staff, of whom 90 are officers, branch managers and assistant branch managers. The board of directors and the management again pledge themselves to continued fidelity in administration and loyalty to trust under those time-tried, conservative policies and sound principles, which the vicissitudes of a hundred and ten years have tested and found true—policies and principles which have gained the confidence of the business world and which are founded upon a desire to serve well the interests of our clients; and finally, to uphold those traditions which are our richest heritage. 446 Financial Chronicle Report of President Potter at Annual Meeting of Stockholders of Guaranty Trust Company of New York—Views Federal Deposit Insurance Plan as Charged with "Grave Possibilities of Injury to Entire American Banking System"—Points to Detrimental Effects of Security Act in Case of Future Rehabilitation of Security Markets—Reduction in German Credit Holdings of Institution —Issuance of $20,000,000 Capital Notes—W. Palen Conway Elected President Succeeding Mr. Potter Who Becomes Chairman of Board. The risks and "unpredictable responsibilities on issuing corporations and their directors and upon dealers in securities" entailed in the Securities Act were commented upon in the annual report to the stockholders of the Guaranty Trust Company of New York, presented on Jan. 17 by President William C. Potter, who said: Under the Banking Act as it exists, we are faced with the following alternatives: (I) to liquidate the Guaranty Company and retire entirely from the security business; or (2) to distribute the stock of the Guaranty Company in such a way as to comply with the law, which requires that the control may not be lodged with the bank stockholders. The first alternative Is comparatively simple, but the result of such action would seem to us unfortunately destructive of values and experience, and decidedly detrimental in any effort for the future rehabilitation of the security markets. If concerns like the Guaranty Company retire from the security business, and if commercial banks are to do likewise and are also prohibited from underwriting, how and by whom will securities be underwritten and sold? At the present, I venture to express the opinion that the nonbanking investment houses have neither the capital nor the facilities to meet the normal requirements for refunding old and issuing new securities. We believe that the experience gained during 26 years by the Guaranty Company and the bond department is worth preserving. On the other hand, we believe that as it now stands the Securities Act entails such great risks and such unpredictable responsibilities on issuing corporations and their directors and upon dealers in securities, that the amounts of sound investment securities which will be issued will be so limited, and the risk in dealing in them so great, that it will not be possible profitably to continue the securities business under the present terms of the Securities Act. It is recognized that some practices in general use in the past have led to many unfortunate results in the issue and distribution of securities, and we are now and always have been in favor of proper legal restrictions surrounding such activities, but not restrictions which make it impossible to transact such business on a sane, conservative basis. We are in favor of the separation of commercial banking and the distribution of securities, but we consider it a misfortune to place such restrictions on their issuance and distribution as to prevent responsible and experienced concerns from continuing in the business. We believe, moreover, that the prohibition against banks underwriting securities will so curtail long-term credit facilities normally needed in this country that industry and commerce will suffer thereby. The "grave possiblilties of injury to the American banking system" in the permanent plan for Federal insurance of deposits was also discussed by Mr. Potter in his report, and his remarks thereon, and his reference to the issuance of $20,000,000 capital notes to the Reconstruction Finance Corporation, follow: The last and most Important topic which I will mention is the guaranty of bank deposits, embodied in the Banking Act of 1933. The Act creates a Federal Deposit Insurance Corporation charged with the duty of purchasing, holding and liquidating the assets of closed member banks and guaranteeing the deposits of all banks entitled to such guaranty. From Jan. 1 to July 1 1931, the Corporation will administer a temporary fund to guarantee deposits up to $2,500. The dangers of this plan are not very great, as liability under it is limited. But the permanent plan that is designed to supersede it on July 1 1934, is charged with grave possibilities of injury to the entire American banking system. This guaranty will cover 100% of all deposits up to $10.000. 75% up to $50,000 and 50% above $50,000. Whenever more money is needed to replenish the guaranty fund, assessments must be levied on all participating banks, and no limitation is placed on the total amount of such assessments or on the frequency with which they shall be made. Thus, every participating bank will assume an unpredictable liability. We believe this plan to be unsound, and if we were free to choose, we would not consider participating in it. Unfortunately, we are not entirely free, since all members of the Federal Reserve System must join or retire from the System. Loss of membership in the Federal Reserve System would deprive us of very valuable privileges and would impel the organization of a new system of clearings and collections, and would entail many other disadvantages of a serious character. This insurance feature of the Act is so unsound that we hope there is a possibility that in the present session of Congress it may be modified. With these considerations in mind, it seems in our best interest to join the temporary Deposit Insurance Fund, and defer our decision as to the permanent fund until it is determined as to what new legislation, if any, will be passed by Congress and '(or) the Legislature of the State of New York. Having in mind that upon final consideration it may seem to be less to our disadvantage to remain in the Federal Reserve System than to retire and be rid of the guaranty of deposits, we realized that assessments to pay losses of closed banks would be less burdensome if the capital structure of all banks needing capital could be strengthened. This end the Government has offered to accomplish through the purchase by the RFC of preferred stock or capital notes of banks. Therefore, when we were requested by the Administration to co-operate in its plan for strengthening the capital structure of banks generally, our board of directors approved of the recommendation of your management to issue $20,000,000 of capital notes. These notes are payable on or before July 311934. They were issued to the RFC and the proceeds of their sale have been invested in the 2-year notes of the RFC, which notes are guaranteed by the United States Government. There Is a small differential in interest in favor of the RFC in this transaction. We are in full accord with the program for Increasing bank capital, and, with this accomplished, it Is to be hoped that the Government and bankers may be able to study more calmly the country's needs and cooperate to create a banking system which will be a credit to the Nation. In the last issue of our monthly publication, the "Guaranty Survey," we have offered certain suggestions along these lines, by no means comprehensive, which seem to us to be desirable. Ian. 20 1934 Other portions of Mr. Potter's report are given herewith: Since the last annual meeting of the stockholders of this company, various laws have been enacted which are of such importance that they deserve the most careful consideration of every bank stockholder and, in fact, every citizen of the United States. We believe it appropriate that a brief review of these matters should be made by the management of this institution to its stockholders. Before discussing these matters, however. I will make a comparison between the earnings of the past year and those of 1932. 1932. 1933. The earnings of the company were $24,562,622 $22,936,059 Out of such earnings dividends were paid at the rate of $20 per share, or 18,000.000 18,000.000 $6,562,622 Leaving Of which there was set aside as reserves or for miscellaneous charge-offs.Including payment to the temporary Deposit 4,810,481 Insurance Fund and the balance of was credited to undivided profits. $1,752,141 $4,936.959 4,000,778 $936,181 Last May, the sum of $5,000.000 was appropriated out of accumulated undivided profits for the purpose of increasing the reserves of the company. with the result that the undivided profits show a net decrease for the Year of $3,247,859. Likewise, in 1932, the sum of $14.661,724 was appropriated out ofaccumulated undivided profits for the purpose of strengthening the reserves. The balance in undivided profits on Dec. 31 1933 was $7,985,635. The Banking Act of 1933, which became a law on June 16 1933. requires the separation of security affiliates by June 16 1934, from all banks which are members of the Federal Reserve System, and from that date prohibits such banks from underwriting securities or dealing in them except for the account of others as an agent, though they may purchase securities for their own account under certain restrictions, and may carry on the business of dealing in Government. State and municipal obligations. In 1920, the Trust Company, which had been doing a s curity business since 1907, organszed the Guaranty Company of New York and to it transferred its security operations. Although it is an entirely separate company and not subject to certain restrictions which apply to the Trust Company, the policy of the Guaranty Company from the start has been to do only such business as the Trust Company itself could do. All of its capital stock Is owned by the Trust Company, which investment Is carried on the books of the Trust Company at less than its liquidating value. During normal times the business of the Guaranty Company has shown very satisfactory profits. After providing for reserves and losses, incurred largely in the last four years, it has shown an average return slightly in excess of 6 % upon the average amount of the Trust Company's investment since its formation to the present date. It is almost needless to say that, owing to the low state of general business, and the restrictions of the new Securities Act, the operations of the Guaranty Company are not at the present moment profitable; 1933 showing a deficit of $688,909, which, however, has been more than offset by recoveries in the market value of its security holdings. The Guaranty Company's present capital is $10,000,000. and on Dec. 31 1933, Its capital, undivided profits and accounts payable were represented by $3,373,610, or 30% in cash, $2,799,474. or 25% in Government bonds, $1,898,606, or 17% in State and municipal bonds. $2,637,611, or 23% in other securities, most of which are readily marketable, and $578,350, or 5% in accounts receivable. . • • Due to the hardships caused by bank failures, and their consequent publicity, the opinion appears to have become widely held that the banking system as a whole is disrupted, and that the situation calls for the creation of an entirely new banking system. The existence of certain weaknesses In the present banking structure, and the accumulation of large losses, are facts not subject to challenge. However, the popular impression as to the condition of the banking system as a whole is in important part erroneous. To obtain a proper judgment we must recognize two facts: 1. That we have not one commercial banking system, but two—the 8 : Reserve member banking system, and the non-member banking enall Fer 2. That the percentage of failures with reference to the membership in each system, and the percentage of deposits in closed and restricted banks in each system have been very much greater in the non-member banking system than in the member banking system.* While the number of failures among member banks has been large, the percentage of deposits of the entire member banking system that has been lost Is very much less than is generally supposed. Except for deposits that have been utilized in the regular way by depositors for paying off loans, very much the larger proportion of the aggregate of deposits in the member banking system in 1929 remains intact to-day in open banks, and these deposits are being used either to finance business or to finance the Government. The stock of our company is quite widely distributed, in spite of the fact that no effort has been made to distribute it or to maintain a market for it. It is interesting to note that we have stockholders In all but three States of the Union and in many foreign countries. On Dec. 31 1933, the company's capital of 900.000 shares of $100 par value was divided among 23,772 stockholders, an average holding of 38 shares. The average holding of the 100 largest stockholders was 2,164 shares. The average holding of the 10 largest stockholders was 6,453 shares each. The company's directors and their families own 37.634 shares. The officers and employees of the company and their families own 9,717 shares, which investments have been made quite independently of aid or influence from the management of the company. At the annual meeting of the stockholders of the Guaranty Trust Company the following directors, whose terms had expired, were unanimously re-elected: Charles P. Cooper, Henry W. de Forest, Eugene G. Grace, W. A. Harriman, David F. Houston, Thomas W. Lamont, Grayson M.-P. Murphy, and William C. Potter. At the annual meeting of the Board of Directors, following the meeting of stockholders, Mr.Potter was elected Chairman of the Board; W. Palen Conway was elected President; Eugene W.Stetson, Vice-President, was elected to the Executive Committee, and thu other officers were re-elected for the ensuing year. The by-laws were amended, fixing the memmember banks were about 74% of •On June 30 1933, the deposits In licensed the deposits In licensed non-member banks the member bank deposits in 1929; while were only about 40% of the deposits in non-member banks In 1929. While these figures are not strictly comparable,they indicate an important difference with respect to the two banking systems, and In both cases they exaggerate the percentage of losses. Volume 138 Financial Chronicle bership of the board at 25, thus meeting the requirements of the Banking Act of 1933, which provides that the board of directors of a member bank of the Federal Reserve System shall consist of not more than 25 members. Mr. Potter was educated as a mining engineer and for 15 years was active in mining and metallurgical operations and their administration, both in this country and in Mexico. He was born in Chicago on Oct. 16 1874, and graduated from the Massachusetts Institute of Technology in 1897 with a degree of Bachelor of Science in mining engineering. He was formerly General Manager of the Guggenheim Exploration Co. in Mexico and later General Manager of the American Smelting and Refining Co.for Mexico and the Southwest. In 1911 he became President of the Intercontinental Rubber Co., and on July 8 1912, was elected a Vice-President of the Guaranty Trust. Company and continued there until March 15 1916, when he resigned to become a member of the firm of Guggenheim Brothers. He continued, however, to be a director of the Guaranty Trust Company and member of its Executive Committee. His further career is summarized as follows: In 1918 Mr. Potter was called to Washington and was appointed Chief of the Equipment Division of the Signal Corps of the U. S. Army. For his services he was awarded the Distinguished Service Medal and later was decorated by the Italian Government as a Commander of the Order of the Crown. Mr. Potter became Chairman of the board of directors of the Guaranty Trust Co. of New York on Jan. 5 1921. to succeed Alexander J. Hemphill, whose death occurred on Dec. 29 1920. He WM elected President of the Trust company on Oct. 5 1921. In addition to his connection with the Guaranty Trust Co. and its affiliated companies, Mr. Potter is trustee of the Mutual Life Insurance Co. of New York, and a director of the Atchison, Topeka & Santa Fe Ry. Co., Electric Bond & Share Co., Bethlehem Steel Corp.. Columbia Gas & Electric Corp., Continental Baking Corp., and other companies. He is a member of the American Institute of Mining and Metallurgical Engineers and of a number of New York clubs. Mr. Potter has at various times served in official capacities in the New York Clearing House Association, and is now a member of the Association's Clearing House committee. During 1929 he served as a member of the Fedqral Advisory Council from the Second Federal Reserve District. W. Palen Conway, Vice-President of the Guaranty Trust Co. of New York since 1916, and a member of the company's board of directors since 1924, started his business career at the age of 19 with the Washington Life Insurance Co. Seven years in the brokerage business, from 1901 to 1908, gave Mr. Conway his first experience in finance, after which he was in the bond brokerage business for three years before joining the staff of the Guaranty Trust Co. in Feb. 1911 as a member of the bond department. His appointment as an Assistant Treasurer of the Trust company followed in 1913; in March 1916, he was made Treasurer, and in September of the same year he became Vice-President. Mr. Conway was elected a director of the Prudential Insurance Co. of America in January 1930. He is also a director of the Guaranty Safe Deposit Co., an affiliate of the Guaranty Trust Co. Eugene W. Stetson, Vice-President of the Guaranty Trust Co. of New York, began his banking career with the American National Bank of Macon, Ga., where he remained until 1904, where he became Cashier of the Exchange National Bank of Fitzgerald, Ga., serving until 1908. In that year he organized the Citizens National Bank at Macon, serving first as its Cashier and later as President, when he was only 28 years old. He remained in Georgia until 1916 and during that time was active in many business and financial affairs throughout Georgia and the South, where his ability as a banker was widely recognized. He served two terms as President of the Macon Chamber of Commerce and was also an organizer of the Georgia State Chamber of Commerce. He also served as Arbitrator for the City of Macon when the city took over the water system from a private corporation. He came to New York in 1916 as Vice-President of the Guaranty Trust Co., a position he has held since that date. Mr. Stetson is a director and member of the executive committee of many corporations, including the following: Guaranty Trust Co. of New York; Bibb Mfg. Co.: Canada Dry Ginger Ale, Inc.; Coca-Cola Co.; French American Banking Corp.; Pure Carbonic Co. of America; Selected Industries, Inc.; Textile Banking Co., Inc.: Tobacco Products Corp. of Delaware; United Drug Co.; United Stores Corp.; W. A. Harriman Securities Corp.; Southeastern Compress & Warehouse Co.; Ward Baking Corp.; One Seventeen East 72nd St. Corp., and Tobacco Products Co. of New Jersey. R. S. Hecht of Hibernia National Bank of New Orleans at Annual Meeting of Stockholders Comments on Banking Act of 1933 and Federal Deposit Insurance Corporation. In his report as Chairman of the board of directors of the Hibernia National Bank of New Orleans at the annual meet- 447 ing of the stockholders on Jan. 9, R. S. Hecht had the following to say regarding the Banking Act: Naturally, the most important change which the "New Deal" legislation has brought to us is the passage of the "Banking Act of 1933." While it Is true that no one, not even its author, is entirely satisfied with all of the provisions of this important legislation, it must be said that its enactment was both timely and desirable and most of its requirements are highly constructive. Fortunately for us, the provisions of the new law fit in perfectly with the practices and policies on which our directors had decided at the outset of our operations, so that no changes of policy were required on our part to conform to the provisions of the new law. In accordance with its terms all deposits in our bank are now insured to the extent of $2,500 up to July 1 1934, and thereafter all deposits up to $10,000 will be fully insured and larger amounts partially so. The only serious concern which your management has over the provisions of the law as it will be after July 1 is the fact that the Federal Deposit Insurance Corporation will then have the right to make unlimited assessments upon all members of the fund. While it is not likely that this would prove a serious menace in the near future, it is fundamentally unsound and objectionable, and we are very hopeful that this feature of the law will be modified during the present session of Congress. Other extracts from Mr. Hecht's report follow: Slightly more than seven months have passed since the Comptroller of the Currency granted the charter of the Hibernia National Bank in New Orleans. We opened for business on May 22 1933, with a pro forma balance sheet showing deposits of $14,121,120.46. We ended the year with deposits of $25,330,892.11. Measured by mathematical percentages this represents an increase of more than 78%, but to your management this gain means much more than that because it is expressive of the fine support of old and new friends who through all the trying days of this difficult period stood loyally by our institution, and thus contributed to its growth and prosperity. To all these friends, both depositors and stockholders, who participated in these gratifying results, we wish at the outset to express our sincere and grateful appreciation. . . . Earnings. Notwithstanding the unusual liquidity which your management deemed essential under the conditions which existed, the earnings of the bank have been quite favorable,due largely to the fact that our overhead expenses have been held down to the lowest possible point consistent with proper efficiency. For the period of May 22 to Dec. 30 1933, the net profits were $140,846.85. After charge-offs amounting to $182.76 and depreciation on furniture and fixtures of $2,702.63, we had a balance of $137,961.46. On Oct. 11933, we paid the preferred stock dividend accrued up to that time at the rate of 5% per annum, I. e., 827,054.79, and have since set up and put into a special account the additional preferred stock dividend which has accrued up to Dec. 30 1933, i. e., $18,750, thus leaving a total of $92,156.67 accruing for the benefit of the common stockholders, or at the rate of over 12% per annum. While these results are gratifying and justify a hopeful outlook for our future earning power, it must be borne in mind that substantial additional taxes will have to be accrued during the ensuing year, and that a moderate increase in the overhead is unavoidable with the continued growth of our business. Moreover, conservatism dictates and our directors consider It a wise policy to set up a special contingency reserve of $50;000. because under existing conditions even the highest grade and short-time securities are subject to some unavoidable fluctuations against which we desire to be protected. Accordingly, the undivided profit account will show a total of $102.156.67, after this special reserve is created, and your capital structure will be as follows: Capital—Preferred ---$1,500,000.00-Res.for contingencies- - --$50,000.00 Common 1,200,000.00-Res. for pref. stock div_ _ _ 18,750.00 Surplus 240,000.00-Other reserves 40,261.23 Undivided profits 102,156.67 To the results outlined above all of the bank's departments have contributed in gratifying measure. The President of the bank, A. F. Imahorn, in his report to the stockholders of the Hibernia National, had the follow• ing to say in part: In order that you may be more fully acquainted with the progress we have made since our opening on May 22 of last year, and that you may have a more thorough knowledge of the assets and workings of your bank, I have prepared some figures taken from our statement as of the close of business Dec. 30 1933, which I believe will be of interest. Cash. Cash on hand and due from banks of $8,287,723.13 is of course all immediately available, there being no funds on deposit with closed or restricted banks and no items held in the cash other than a few small checks strictly of a current nature, which have since been paid. United Stales Gorernment Obligations. United States Government obligations $11,689,785.79. Approximately 80.46% of these securities are short-term obligations and are presently carried on the books at $37,152.57 below cost, it being our policy to credit the bond account with any profits derived from sales in order to take care of fluctuations in market value. We believe that these securities are Probably the safest investment that a bank can make. Other Bonds and Securities. Other bonds and securities $2.830,141.24. Approximately $2,000,000 of these securities represent various high-grade municipal issues, practically all of which were taken over directly from the old bank or purchased from the Reconstruction Finance Corporation out of the assets of the old bank. When these items were acquired they were charged down to their market value and were approved by a committee consisting of a representative of the Comptroller of the Currency, the RFC and two active officers of the bank. We believe that these securities are presently carried at approximately their fair market value. Certainly the reserve of $50,000 which the Chairman has suggested should be much more than sufficient to take care of any possible loss. Other bonds are composed of high-grade industrial and public utility Issues, all of them listed and most of them short-term obligations. Loans and Discounts. Loans and discounts—$6,647,098.69—are divided as follows: Commercial $3.014,000.00-Municipal obligations Banks 62,000.00- sec.by pledge oftaxes$2,280,000.00 Real estate 226.000.00-Personal 602.000.00 Of the commercial loans, $1,005,000 are secured by commodities, the balance are supported by current financial statements and other credit data. 1 448 Financial Chronicle The $62,000 to banks are strictly of a temporary nature and are secured by collateral immediately convertible into cash. Real-estate loans of $226.000 are to homesteads and churches and are being reduced gradually. $2,280,000 municipal obligations secured by pledge of taxes are divided as follows: $632,000 School Board $156,000 Levee Board 1,492,000 City of New Orleans $60,000 of the $602,000 of personal loans are unsecured, and by personal loans I mean loans to individuals, all but about $10,000 being secured by Government obligations or other marketable collateral. Other items in loans and discounts aggregating $463,000 are composed of drafts with bills of lading attached, all in process of collection, &c. At the annual meeting of the stockholders of the Hibernia National Bank in New Orleans held Jan. 9 the entire board of directors of the bank was re-elected. The board re-elected the entire official staff. Annual Report to Stockholders of Irving Trust Company of New York—Operating Profit in 1933, $6,633,303—Permanent Federal Deposit Insurance Plan Would Subject Class A Stockholders to Assessments Without Limitation—Sale of $5,000,000 Capital Notes to Reconstruction Finance Corporation. The annual report presented to the stockholders of the Irving Trust Company of New York on Jan. 17 states that the company, under the temporary Federal Deposit Insurance plan, is as a member of the Federal Reserve System, obligated for a maximum of about $390,000, of which approximately half ($193,627) has been charged to expenses. Of this latter amount, it is stated, $96,814 has already been paid and the remainder is carried in reserve. Regarding the permanent plan, effective July 1 1934, the report says in part: Under the permanent plan, as the law now stands, the Company, as a Federal Reserve member, would be obliged to subscribe for Class A stock of Federal Deposit Insurance Corporation in an amount presently estimated at $1,750,000. One-half of the subscription would have to be paid on or before July 1 f934, and the other half on call. It is the duty of the management to emphasize that under the permanent plan the Company, as a Class A stockholder, would be subject to repeated assessments without limitation as to their aggregate amount to replenish the funds of the Federal Deposit Insurance Corporation as needed to protect the guaranteed deposits of other banks. The report was presented by Harry E. Ward, President, and Lewis E. Pierson, Chairman. According to the New York "Times," the meeting was enlivened by a debate among shareholders and the management upon deposit insurance, the Irving's receivership department and the Better Business Bureau. In part the "Times" said: Much of the discussion from the floor revolved about the operations of the receivership department of the trust company, which, it was disclosed, has sustained a net loss for the year of $11,732. Asked why the company did not give up the department, Mr. Pierson pointed out that there were accrued profits from the past and that there were prospective fees on cases still to be closed. He also alluded to the fact, brought out in the report to shareholders, that the Irving earned an average of $100,000 a year in interest on funds deposited with it by the department. This, while not large, could not be dismissed entirely. In addition he stressed the fact that the department was run as "the servant of the court" and had not been started originally with the profit motive primarily in view. Mr. Pierson was asked why the company did not recommend that its shareholders write to their Representatives and Senators protesting against the plan and replied that he did not wish to appear to be telling the stockholders what to do, but added that the suggestion was "very pertinent." He said that he could not guess what the chances were of obtaining a change in the law by July 1. Protection for Capitalists. In connection with the discussion a stockholder proposed that, since everybody was being regimented these days. it was time for "poor, despised capitalists like ourselves," to organize for protection. His suggestion was applauded by those present, but Mr. Pierson declined to sponsor the movement. From the report we quote: On Dec. 211933, the Board of Directors of the Company authorized the Purchase from the RFC of $5,000,000 of its 231% notes and the sale to that corporation of a'4% Capital Note in like amount retirable on or before July 31 1934, to be issued by the Trust Company in accordance with the request of the President of the United States for the co-operation of all banks in the program of the Government. The table below shows a summary of Operating Income and Operating Expenses for the years 1929-1933, inclusive. The Operating Profit shown, which in each year has exceeded the dividends declared by the Company, is subject to deductions for charge-offs, taxes. etc. Operating operating Operating Expenses. Profit. Income. $34,028,321 $19,096,240 $14,932,081 1929 11,223,952 17,206,168 28,430,120 1930 12,741,911 9.197,379 21,939.290 1931 8,599,530 10,332.880 18,932,410 1932 8.515.947 6,633,303 15,149,250 1933 . Annual Report of President Lucas to Stockholders of National Bank of Commerce in New Orleans. Some of the comments contained in the annual report of President Oliver G. Lucas, President of the National Bank of Commerce in New Orleans presented to the stockholders on Jan. 9 are annexed: On the occasion of the first annual meeting of our shareholders, it is gratifying to report the substantial progress made by the National Bank of Commerce in New Orleans during the 731 months of its existence. Jan. 20 1934 The Bank has enjoyed a gradual, but constant, growth in deposits.‘It has extended its credit facilities to sound commercial borrowers, and has built up a very.satisfactory portfolio of loans based on present-day values and conditions. While an unusually high degree of liquidity has been maintained through carrying a large proportion of cash and U. S. Government securities, the Bank's net earnings have met fully all reasonable expectations. I take this occasion to present what I consider interesting facts and figures: Deposits. The deposits of the National Bank of Commerce as of the opening day compared with the last day of the year 1933, were as follows: Opening, May 22 1933 $17,525,061.97 Dec.30 1933 21,785,308.60 Increase $4,260,246.63 The actual increase in commercial deposits and those of banks and bankers has been greater than the above figures would indicate. The deposits of the opening day were in the nature of a liquidating dividend by the Canal Bank & Trust Co., and, as was to be expected, a great many balances— Particularly smaller accounts—were withdrawn during the first few weeks of the new bank's operation. Public funds held by the National Bank of Commerce have not greatly increased. Liquid Position. I call your particular attention to the fact that on Dec. 30 1933, the assets of the Bank included: $5,395,288.45 Cash and due from banks 60,000.00 Due from United States Treasurer 87,000.00 Stock in Federal Reserve bank 13,756.883.91 United States Government securities $19,299,172.36 Total This degree of liquidity, of course, is very high, and is matched by few banks in the United States. Loans and Discounts. Your board of directors has considered carefully each loan made by the Bank. Borrowers for constructive commercial purposes have been encouraged. No applications for credit have been declined where all of the circumstances justified making the advance. Slow loans, even though amply secured, have been avoided. A classification of the loans of the Bank as of the close of business Dec. 30 1933, will illustrate the extent to which the above stated policies have been observed: $2,289,100.85 Loanssecured by commodities 1,340.153.96 Loans secured by bonds and stocks adequately margined notes. mortfirst Loans otherwise secured,including collateral contracts 451,681.84 gages and assignments of Loans to commercial borrowers, based on financial statements, 1,478.258.99 for current purposes 92,716.05 Sundry small loans Total $5,651,911.69 Municipal Financing. As of Dec. 30 1933, the Bank carried $835,463.46 of tax anticipation notes of the Orleans Parish School Board and the City of New Orleans. These notes, all due within one year, were issued in accordance with the respective budgets for current operating purposes, and are fully secured by a pledge of taxes and other revenues. We did not take over from the Canal Bank & Trust Co. several large public accounts secured by municipal notes, and therefore began business with a relatively small amount ofsuch paper. This enabled us to participate with other banks in current city and school board financing, and still keep our loans of this character within conservative limits based on our capital structure. Investments. At the time of making this report, the Bank has but $1,200 of bonds other than United States Government securities. With respect to the latter, it has been the policy to favor the shorter maturities for the investment account—in no case more than 10 years and the majority considerably shorter. Bonds purchased at a premium are amortized monthly before taking interest into earnings. The National Bank of Commerce owns no real estate. President Baldwin's Annual Report to Stockholders of Empire Trust Co., New York—Earnings and Profits in 1933, $610,650—Capital Reduced from $600,000 to $3,000,000—Has Joined Temporary Fund of FDIC But Undecided as to Permanent Plan. Earnings and profits of Empire Trust Co., New York, for the year 1933 were $510,650, stockholders of the bank were told at their 32nd annual meeting by Leroy W. Baldwin President. This is equivalent to $1.70 a share. Present dividend requirements are $1.00 a share a year. Mr. Baldwin referred to the fact that the liquidity of the bank was 83.92% of total deposits, and 98.43% of demand deposits; also that the foreign securities in its portfolio totaled only $250,000. An announcement issued regarding the meeting said: The stockholders approved the recommendation of the Board of Directors to change the par value of the capital stock from $20. to $10 a share, thus reducing capital from $6,000,000 to $3,000,000. This reduction, it was stated, together with $350,000 from undivided profits, will be added to reserves, fully to cover depreciation in all the company's assets. After giving effect to these changes, the company's statement will show: $3,000,000.00 Capital stock 3,000,000.00 Capital notes 2,350,000.00 Surplus and undivided profits, about 4,700.000.00 Reserves, about 55,000,000.00 Deposits, about Mr. Baldwin announced that, although the company had joined the temporary fund of the Federal Deposit Insurance Corporation, no decision hadlbeen reached as to membership in the permanent plan, which, under existing law, becomes effective July 1 1934. He indicated some of the seriousl objections to the permanent plan, and intimated that failure to remove these objections through amendment of the law might result in the withdrawal of some important)banks from the Federal Reserve System. In that event the question of joining the permanent plan would have to be given the most careful consideration. Financial Chronicle Volume 138 All of the retiring directorsTwere re-elected and Mr. Ned G. Begle, President of Berst, Forster & Dixfield, was added to the Board. The recommendation to reduce the capital was made at a meeting of the directors held Dec. 19—reference to which was made in our issue of Dee. 23, page 4459—at which time the sale of $3,000,000 of capital notes to the Reconstruction Finance Corporation was also authorized. New Earnings of Continental Bank & Trust Co. of New York for 1933, $481,404.85 Annual Meeting Told—Dividends of $360,000 Paid—Deposits 5% Higher Than in 1932—$1,250,000 Transferred to Reserve Account—Subscribed to Federal Deposit Insurance Fund—Issuance of Capital Notes. At the 64th annual meeting of the Continental Bank & Trust Co. of New York held Jan. 17, the President, Frederick H.Hornby,reported net earnings for the year of S481,404.85. Out of this, dividends were paid amounting to $360,000, leaving a balance of $121,404.85, which was carried to undivided profits. Mr. Hornby said that "the low interest rates which have prevailed during the past two years have made it increasingly difficult for banks to show satisfactory earnings, but the Continental has to a large extent off-set this reduced income by a reduction in expenses, the largest savings being in salaries which have been reduced over. $200,000 since Dec. 31 1931, or more than 28%." He added: The Continental, being a member of the Federal Reserve System, automatically became a subscriber to the Federal Deposit Insurance Fund. The cost to the institution under the temporary plan amounted to $11,089.35 which amount has been charged to expense. It is hoped that before this temporary plan becomes permanent on July 1 1934,some modification will be enacted by Congress. Solely from a desire to co-operate with the Federal Government, the bank has issued its capital notes for $100,000 and invested the proceeds in a like amount of Reconstruction Finance Corporation debentures. During the year $1,250,000 was transferred to reserve account, and the directors are now considering setting up further reserves in an amount which should not exceed $1,000.000, to cover depreciation in city and State bonds and to make provision for any further losses on loans. We believe these reserves will be ample and that substantial recoveries may be expected. Net deposits, which showed a steady increase during the year, averaged about 5% higher for 1933 than for 1932. Reopening of Closed Banks for Business and Lifting of Restrictions. Since the publication in our issue of Jan. 13 (page 276), with regard to the banking situation in the various States, the following further action is recorded: ILLINOIS. The Aetna State Bank of Chicago, Ill., at Lincoln and Fullerton Avenues, reopened on Jan. 12 on an unrestricted basis with a dollar in cash for each dollar of deposit liability. Co-operation of the bank's depositors and assistance from the Reconstruction Finance Corporation made possible the reorganization, James Maltman, President of the institution, stated. The Chicago "News" of Jan. 12, from which this is learnt, went on to say: The bank was founded 20 years ago under the management of Mr. Maltman. who continues as President of the reorganized institution. At the peak in 1930 Aetna State Bank had deposits of $4500000 as contrasted with the present moderate liability of $157,000. More than 95% of the bank's deposit liability had been liquidated in less than a threeyear period. The bank will participate in the temporary fund of the Federal Deposit Insurance Corporation, and deposits will be insured to the extent authorized by Congress in the Banking Act of 1933. Farmers' State Bank of Lawrenceville, Ill., has been authorized by the State Auditor of Illinois to reopen on an unrestricted basis, according to advices from Chicago on Jan. 15 to the "Wall Street Journal." MARYLAND. On Jan. 12 John J. Ghingher, State Bank Commissioner of Maryland, approved the creation of the First State Bank of Smithburg (Washington County) as a substitute for the defunct People's Banking Co. of that place, according to Baltimore advices by the Associated Press on that date, which went on to say: The new bank will have $50,000 capital and a $10,000 surplus, with the Washi -sten County liquidating Corp., the creating of which Mr. Ghingher also approved, owning all shares except those necessary to qualify directors. With the creation of the new bank the depositors of the old People's Banking Co., formerly a branch of the closed Central Trust Co. of Maryland, will receive a dividend of approximately 5%,Mr.Ghingher announced. Except where the dividend is very small, this will be paid as a checkable deposit in the new bank. The State Bank Commissioner for Maryland, John J. Ghingher, announced on Jan 15 that he had approved a revised plan of reorganization of the Lonaconing Savings Bank, Lonaconing, Md., revoking a previous reorganization plan approved last July 25, according to the Baltimore "Sun" of Jan. 16, which added: The new plan provides for the incorporation of a new bank having a capital of $50,000 and a surplus of $25,000. 449 MICHIGAN. Payment in full for 135,000 depositors in the closed Guardian Union National Bank of Detroit, Mich., was made possible on Jan. 12 through the authorization by the RFC of an additional loan of $3,000,000 on the assets of the bank. This amount will permit of an 8% distribution to all creditors, but about 100 of the large depositors have subordinated their share in this distribution in order to enable all depositors of $1,000 or less to receive full payment. From the Michigan "Investor" of Jan 13, we learn that three Michigan banks were reopened last week, namely the Brighton State Bank, Brighton; the Cedar Springs State Bank at Cedar Springs, and the Miners' First National Bank of Ishpeming. We quote, in part, from the paper mentioned, as follows: The capital of the Cedar Springs Bank was increased from $20,000 to $25,000 to make it eligible for the Federal Reserve and Federal deposit insurance. The Brighton bank resumed business with E. R. Hyne as President and R. 0. Newcomb Cashier. The Ishpeming bank opened on an unrestricted basis, releasing 60%, or 81,000,000 to depositors of the old bank. NEBRASKA. The financial structure of the Overland National Bank, to be established in Grand Island, Neb., through reorganization of the Nebraska National Bank of that place, has been completed by the Secretary's approval of the purchase of $50,000 in preferred stock by the RFC, A. J. Guendel, the conservator has announced. Associated Press advices from Grand Island, from which the foregoing is learnt, continuing, said: Representative farmers and business men have subscribed $50,000 common stock and $1,250 for the surplus account Former State Senator H. G. Wellensiek tentatively has been selected as head of the new bank. NEW JERSEY. Directors of the Elizabeth Trust Co., Elizabeth, N. J., on Jan. 18 announced that the bank will operate under provisions of the Altman Act, which empowers the State Commissioner of Banking and Insurance to extend for ninety days or more the payment of time accounts and authorizes indefinite postponement in payment of any proportion of demand accounts. Elizabeth advices by the Associated Press, from which this is learned, furthermore said: The action, the directors explained, was voluntary, Difficulty in liquidating the assets of the closed People's Banking & Trust Co.,80% of which the Elizabeth Trust Co. took over, was given as the reason. "In order to effect reorganization of the bank for the benefit of all concerned, the Board of Directors has decided to operate under the Altman act," a statement issued to-day,said. The bank, one of the largest in Union County, has assets of more than $10,000,000. The People's Banking & Trust Co., closed in January 1931, and 80% of its assets were purchased by the Elizabeth Trust Co.in July of that year, as noted in the "Chronicle" of July 18 1931, page 391. NEW YORK STATE. Bellport National Bank, of Bellport, N. Y., a member' of the Federal Reserve, reopened on Jan. 12 on unrestricted basis, after being closed since the holiday last March, according to advices from Bellport to the New York "Herald Tribune," which furthermore said: William MacIntosh, conservator, continues as President. For four months reorganization took place under a plan whereby depositors waived 30% deposits, which are to be trusted and returned as slow assets are liquidated. Bellport National is one of the few banks allowed to reopen with the same name and with the same President as before closing. In regard to the affairs of the closed Huguenot Trust Co. of New Rochelle, N. Y., a dispatch from New Rochelle on Jan. 12 to the New York "Times"contained the following: The New Rochelle Chamber of Commerce announced to-day (Jan. 12) named to "co-operate with and advise" the counsel of the State Banking Department with respect to the closed Huguenot Trust Co. taken over Jan. 2 by the Banking Department. Conferences were started to-day with James T. Heenehan, Banking Department counsel. Members of the committee are Lee J. Eastman, Vice-President of the Packard Motor Car Co. of America. J. W. R. Crawford, retired, former Vice-President of the Standard Oil Co. of New York; Henry R. Corse, President of the Electric Boat Co.; Robert W.Martin,President of American Investors, Inc.: Elmer W. Shepard, Treasurer of the Graybar Electric Co.: F. L. Gilbert of Ernst & Ernst, public accountants, and Harry E. Crooks, President of the Chamber of Commerce. a citizens committee A dispatch from Valley Stream, L. I., on Jan. 10, printed in the Brooklyn "Eagle", stated that no further efforts were to be made to effect reorganization of the closed Bank of Valley Stream, according to a statement issued on that day by Walter E. Willcox, Chairman of the depositors and stockholders committees. This means, Mr. Willcox said, that the depositors will lose practically every cent they had in the bank. He was quoted further in the dispatch as saying: 450 Financial Chronicle Jan. 20 1934 All activities to effect the reorganization of the bank have been stopped There is no possibility of doing anything, as the bank is hopelessly in- capitalization. Harrisburg, Pa., advices to the Philadelphia. "Ledger" in reporting the above added: There has been no direct statement from the State Banking Department as to the condition of the bank, but I am sure it cannot be saved. The Glen Rock bank will be successor of the Trust Co. of Glen Rock, which has been operating on a restricted basis. . . The Elizabeth bank will succeed the State Bank of Elizabeth, also on a restricted basis. . . • The Banking Department said that reorganization plans under which the new banks will operate without restrictions are pending. solvent. Concerning the affairs of the closed Westchester Trust Co. of Yonkers, N. Y.,a dispatch from White Plains, N.Y., on Jan. 15 to the New York "Herald Tribune" contained the following: Independent groups of depositors in the Westchester Trust Co., of Yonkers, which was closed Jan. 2 by Joseph A. Broderick, State Superintendent of Banks, to-day (Jan. 15) appeared in the Supreme Court here to object to a plan of the State Banking Department to reorganize the bank under the name of the Citizens Trust Co. with the aid of an RFC loan of $2,985,000. The depositors contended through counsel that the Westchester Trust depositors have not been informed of the arrangements under which the new bank is being formed. The charge was made by Alan R. Campbell, of Yonkers, counsel for one of the objectors, that the move of the State banking authorities is one sponsored by the old stockholders of the bank "seeking to save themselves at the expense of the depositors." Mr. Campbell alleged that the process by which the new bank is taking over the affairs of the old one is illegal and he asserted that a simple liquidation of assets in the long run would benefit the depositors more than the formation of a new institution. "This plan simply hands over to the same people who have run the bank before whatever good assets and benefits remain from the Westchester Trust Co. and leaves them free of the detriments and burdens which have accrued under the old management," the lawyer said. Lewis Bassiano, counsel for another group of opposition depositors, declared that unless some form of co-operation is reached between the State banking authorities and the dissenting depositors, the latter are prepared to contest the plan along legal lines with Max Steuer as counsel. Gerald Donovan, counsel for Mr. Broderick. asserted that Ile closed bank's assets are substantial, but "frozen," and he said that the only way to get some cash into the hands of the depositors now is by reorganization. The Federal Government, he said, is ready and willing to make the required loan, provided the plan receives court sanction. A conference between banking officials and the dissenting groups was held before the court argument in the offices of Supreme Court Justice William F. Bleakley, but no accord could be reached. The motion to confirm was argued before Justice Frederick P. Close, who reserved decision. Authorization came on Jan. 16 from the Comptroller of the Currency to Warner Pyne, receiver of the Pelham National Bank, Pelham, N. Y., to pay a dividend of 11% to depositors and other creditors. This is the first dividend paid by the bank, which was closed at the beginning of the banking holiday on Mar. 3 1933, and never re-opened. It was in the hands of a conservator from March until the appointment of the receiver on July 211933. The New York "Herald Tribune," Jan. 17, authority for the above, continued: Mr. Pyne said that the initial dividend payment to depositors was made possible by the receiver's obtaining funds in addition to those he had collected out of assets by a loan from the RFC. The statement of condition of the receivership as of Dec. 311933,showed that profits and earnings of the receivership of$17,774 had exceeded receivership expenses and that the receiver had collected $1.000,000 from July 21 to Dec. 31 at a cost of 1j%. With reference to the new national bank being organized in Philadelphia,,Pa., which will take over certain acceptable assets of the Southwestern Nationat Bank and the Sixth National Bank (both of which have been operating under conservators since the banking holiday), the Philadelphia "Ledger" of Jan. 18, carried the following: The organization committee of the proposed South Philadelphia National Bank met yesterday (Jan. 17) afternoon and last night at the offices of the Southwestern National Bank, Broad and South Streets. Norman C. Ives, conservator of the Sixth National Bank, Chairman of the committee, and Eugene Walters, conservator of the Southwestern National, reported substantial purchases of stock in the new institution by depositors in their banks. Opening of the new bank awaits completion of the sale of capital stock. The South Philadelphia National is the link required to begin the release of restricted balances of old accounts of the Sixth National and the Southwestern National. It will maintain what is now the main office of the Sixth National at Sixth and Pine Streets, and that of the Southwestern. Both these banks are open on a restricted basis. The new bank will begin business with capital of $500,000 and deposits 'of nearly $2,000,000. SOUTH CAROLINA. That the Victory Savings Bank of Columbia, S. C., was to reopen for business on Jan. 8 was indicated in the following taken from the Columbia "State" of Jan. 5: The State (South Carolina) Board of Bank Control on Jan. 4 granted the Victory Savings Bank, 1107 Washington Street, authority to open Monday morning for unrestricted business. The bank was closed March 4 when the moratorium was declared. Later the Board placed the institution in charge of a conservator, Dr. N. A. Jenkins, Chairman of the board of directors. The board afterward granted the bank authority to reopen in case the assets were increased by $12,000. This was accomplished by securing direct loans from citizens of Columbia who were granted certificates which will be redeemed when the bank is enabled to meet the obligation. W. H. Harvey, President of the bank previous to the moratorium, will automatically head the inst_tution when it reopens Monday. VIRGINIA. That the closed Bank of Northumberland, Inc., of Heathsvile, Va., may reopen shortly is indicated in the following dispatch from Fredericksburg, Va., on Jan. 10 to the Washington "Post": M. E. Bristow, State Commissioner of Insurance and Banking for Virginia, will address a meeting of stockholders and depositors of the Bank of Northumberland, Inc., in the Northumberland County Court House at Heathsville to-morrow. The condition of the bank will be disclosed and it is expected officials will move to reopen the institution. The bank has been thoroughly examined by State and Federal agents. OHIO. WISCONSIN. Cleveland, Ohio, advices on Jan. 9 by the Associated Press contained the following regarding the affairs of the defunct Union Trust Co. of that city: The Citizens' National Bank of Stoughton, Wis., which had been operating on a restricted basis since the national banking holiday, on Jan. 11 was placed in charge of a receiver, B. C. Olejniczak, appointed by the Comptroller of Currency. Associated Press advices from Stoughton, noting this, added: The Union Trust Co.'s $10,731,627.73 liquidating loan at the National City Bank, Cleveland, has been reduced to $5,890,149.82 since it was granted July 21 1933. to make possible the Union's 60% pay-off to depositors, LlquIlator Oscar L. Cox disclosed to-day (Jan. 9). Principal proceeds of liquidation since July have gone into the retirement of the Union's obligations at the National City, the balance due the RFC for its loans remaining practically unchanged. Mr. Cox explained that this was due to the fact that most of the Union's quick assets were ui as collateral for the National City loan, while the slower collateral guaranteed the RFC loans. Advices from Steubenville, Ohio, on Jan. 8 to the Pittsburgh "Post-Gazette," reported that a campaign to sell $25,000 worth of new stock in the First National Bank of Mingo Junction, Ohio, had been successful, according to an announcement on that date, and application had been made to the RFC for a loan of $50,000 for the payment of a 50% dividend to depositors on the date of reopening, which would be within 60 days. The dispatch continued: Henry McFadden Jr., Steubenville, has been named conservator for the bank, and Wilbur Morrison, Coshocton, Ohio, Cashier. The bank has been closed to active business since the bank holiday. We learn from Akron, Ohio, advices on Jan. 17, appearing in the "Wall Street Journal" that payment of a 25% dividend totaling approximately $6,500,000 due depositors of the reorganized First Central Trust Co. of Akron, was started on Jan. 15 after final approval had been given by officials of the RFC, Cleveland office. The dispatch continuing, said: Approximately 90,000 depositors will share in the pay-off. John R. Eckler, President, said a $25,000,000 loan was obtained from the RFC to clear up old debts and create part of the capital of the new institution. PENNSYLVANIA. State charters were issued on Jan. 5 to two Pennsylvania banking institutions, namely the Peoples Bank of Glen Rock, York County, capitalized at $50,000, and the Bank of Elizabeth, Elizabeth, Allegheny County, with the same Capitalized at $50,000, the bank had been supervised by F.0. Phillips, conservator, since the national moratorium. Additional Lists of Banks Licensed to Resume Operations in Second (New York) Federal Reserve District. Supplementing its statement of Dec. 6 (given in our issue of Dec. 9, page 4140), the Federal Reserve Bank of New York has issued the following additional lists showing banking institutions in the Second (New York) District which have been licensed to resume full banking operations: FEDERAL RESERVE BANK OF' NEW YORK. [Circular No. 1322, Dec. 20 1933.1 MEMBER BANKS—NEW YORK STATE. Altamont—The First National Bank of Altamont. Canajoharle—National Spraker Bank in Canajoharle. (Newly chartered to succeed The National Spraker Bank of CanaJoharie). Yonkers—First National Bank in Yonkers. (Newly chartered to succeed The First National Bank & Trust Co. of Yonkers.) NEW JERSEY. Jamesburg—The First National Bank of Jamesburg. NON-MEMBER BANK—NEW JERSEY. Clifton—Clifton Trust Co. NEW MEMBER BANKS. The following State banking institutions, previously licensed to resume full banking operations by the Superintendent of Banks of the State of New York, have been admitted to membership in the Federal Reserve System: NEW YORK STATE. Delmar—Bank of Bethlehem. Ellenburg Depot—The State Bank of Ellenburg. Ontario—State Bank of Ontario. Financial Chronicle Volume 138 FEDERAL RESERVE BANK OF NEW YORK. [Circular No. 1329, Jan. 3 1934.1 MEMBER BANKS—NEW YORK STATE. Additions— Bliss—a The Bliss National Bank. Gouverneur—First National Bank in Gouverneur. (Newly chartered to succeed The First National Bank of Gouverneur.) Ilion—The Manufacturers National Bank of Ilion. Tuckahoe—The Crestwood National Bank in Tuckahoe. (Newly chartered to succeed The Crestwood National Bank of Tuckahoe.) Tuxedo—The National Bank of Tuxedo. (Newly chartered to succeed The Tuxedo National Bank.) Washingtonville--Central National Bank of Washingtonville. (Newly chartered to succeed First National Bank in Washingtonville.) a Bank In Buffalo Branch territory. NEW JERSEY. Additions— Edgewater—The Edgewater National Bank. (Newly chartered to succeed The First National Bank of Edgewater.) Metuchen—Metuchen National Bank. (Newly chartered to succeed The Metuchen National Bank.) Paterson—The National Bank of America in Paterson. Spring Lake—First National Bank of Spring Lake. (Newly chartered to succeed The First National Bank of Spring Lake). NON-MEMBER BANKS—NEW YORK STATE. Additions— North Collins—Bank of North Collins. Withdrawals— Hudson—b Hudson River Trust Co. New Rochelle—b Huguenot Trust Co. b Previously licensed to resume full operations. Suspended business Jan. 2 1934 by order of the Superintendent of Banks. NEW JERSEY. Additions— New Brunswick—New Brunswick Trust Co. Withdrawals— Bayonne—c Mechanics Trust Co. Hawthorne—c Peoples Bank of Hawthorne. Paterson—c Merchants Trust Co. Paterson—c Security Trust Co. c Previously licensed to resume full operations. Operating on a restricted basis as of Jan. 2 1934.. NEW MEMBER BANKS. The following State banks, previously licensed to resume full banking operations by the Superintendent of Banks of the State of New York, have been admitted to membership in the Federal Reserve System: NEW YORK STATE. Amityville—The Bank of Amityville. Sag Harbor—The Peconic Bank. FEDERAL RESERVE BANK OF NEW YORK. [Circular No. 1336, Jan. 17 1934.1 MEMBER BANKS—NEW YORK STATE. Additions— Bellport—The Bellport National Bank. Cato—The First National Bank of Cato. Ovid—The First National Bank of Ovid. NEW JERSEY. Addition— Fords—The Fords National Bank. NON-MEMBER BANKS—NEW JERSEY. Withdrawal— Newton—* Newton Trust Co. NEW MEMBER BANKS. The following State banks, previously licensed to resume full banking operations by the Superintendent of Banks of the States of New York and New Jersey, have been admitted to membership in the Federal Reserve System: NEW YORK STATE. Ossining—Ossining Trust Co. 'Vesthampton Beach—Seaside Bank. NEW JERSEY. Newark—West Side Trust Co. * Formerly Remised. began operating on restricted basis subsequent to Circular No. 1329, Jan 3 1934. GEORGE L HARRIS° Governor. ITEMS ABOUT BANKS, TRUST COMPANIES, ETC. A Stook Exchange membership was sold Jan. 15 for $150,000, a rise of $24,000 over the previous transaction of Jan. 8. Arrangements were made Jan. 15 for the sale of a New York Curb Exchange membership at $40,000, an advance of $9,000 over the last transaction of Jan. 5. On Jan. 17 the membership in the New York Cotton Exchange standing in the name of Locke Brown was sold to Philip B. Weld for another, the second membership of William W.Cohen was sold to Harry L. Goss for another, and the second membership of Paul Schwarz was sold to Walter B. Keiffer for another, at $18,200 each. This price represents an advance of $2,200 over the previous sale. A Chicago Board of Trade membership sold Jan. 12 at $9,000, an increase of $100 over last previous sale of the same date. 451 At the annual organization meeting of the Board of Directors of the Cheroical Bank & Trust Co. held Jan. 18, all officers were re-elected. Wilbur F. Crook, formerly Vice-President, was elected to the newly created office of Vice-President and Branch Supervisor. This designation is in line with the duties which Mr. Crook has performed for a number of years as Supervisor of the bank's 13 branches. William A. Edwards, formerly Assistant Secretary, was elected Assistant Branch Supervisor. Amos B. Foy, formerly Assistant Secretary, was elected an Assistant VicePresident, and Clinton C. Johnson, formerly Assistant Manager of the Foreign Department, was elected an Assistant Secretary in charge of the Commodity Department. James B. Davis and Edward F. McGinley were elected Assistant Secretaries, as were also Huntington M. Turner, formerly Assistant Trust Officer, and Stephen L. Jenkinson, formerly Assistant Treasurer. Charles F. Henrett and M.J. Topp were elected Assistant Branch Managers. The annual report to the stockholders of Percy H. Johnston, President of the Chemical Bank & Trust Co. is referred to in the front part of this issue of our paper to-day. At a meeting of the Board of Directors of Bankers Trust Co.of New York,held Jan.17,B.P. Leeb,formerly Assistant Vice-President, was elected Vice-President;and W.J. Kenny, formerly Assistant Treasurer, was appointed Assistant VicePresident. At the annual meeting of the board of 'rustees of Central Hanover Bank & Trust Co., New York, Jan. 18 all officers were re-elected. At the annual meeting of the stockholders of Trust Co. of North America in New York held Jan. 17 all directors and officers were re-elected. At the annual meeting of the Dunbar National Bank, New York City, held Jan. 9th, Harold L. Van Kleeck, Vice-President of the Chase National Bank, was elected a director. Seven directors, J. Howard Ardrey, Henry E. Cooper, Bertram Cutler, Frank A. Dillingham, Robert Gumbel, George Leask and Fred R. Moore, resigned, thus reducing the board to 12 members. Guaranty Trust Co. of New York announces the appointments of C. Herbert Lee, Investment Trust Officer, and William McK. Lewis, Assistant Secretary, in New York, and B. Frank Patton, Assistant Trust Officer in the London office of the company. The annual meeting of the trustees of the Bowery Savings Bank, New York City, was held.Jan. 8. Edward S. Innet was advanced from Deputy Controller to Assistant Vice-President and Robert W. Sparks from Assistant Treasurer to Assistant Vice-President. Merwin L. Smith was appointed Assistant Treasurer and William H. Switzer Deputy Controller. At the annual meeting of the Board of Trustees of the Greenwich Savings Bank of New York, held Jan. 11, Clarence M. Fincke was elected Third Vice-President. John W. Roeder, a Vice-President and Trust Officer of the People's National Bank of Brooklyn, Brooklyn, N. Y., was elected a director at the annual meeting held Jan. 9. He succeeds the late William A. Agricola. The other members of the Board were re-elected. The position of Chairman of the Board of Directors was discontinued by the Citizens' Bank of Brooklyn, Brooklyn, N. Y., at the annual meeting held Jan. 10. F. J. Heidenreich, former Chairman, was elected President, succeeding the late John C. Creveling. Henry M. Feist, Vice-President, was elected a director. Reduction of the capital stock of the Manufacturers' & Traders' Trust Co. of Buffalo, N. Y., from 600,000 to 500,000 shares at $10 par value was voted by the stockholders of that company at the stockholders' annual meeting last week. Advices from Buffalo to the New York "Times," in reporting this, went on to say: This change will be effected by purchase of stock from surplus bank funds at $15 a share. This action will reduce the bank's capital from $6,000,000 to $5,000,000, and surplus from $3,500,000 to $3,000,000. This capital has been replaced by the sale of $5,000,000 capital notes to the Reconstruction Finance Corporation. 452 Financial Chronicle According to the Buffalo "Courier" of Jan. 11, the appointment of Francis B. Bacon and Charles W. Dorries as Assistant Secretaries of the Manufacturers' & Traders' Trust Co. was announced on Jan. 10 by Lewis G. Harriman, President of the institution. Both heretofore 'had been connected with the credit department of the bank. The. directors of the Marine Trust Co. of Buffalo, N. Y., at their annual meeting last week appointed the following officers: George F. Rand, President; Elliott C. McDougal, Chairman of the Board; William A. Zimmerman, Vice-President and General Manager; Henry J. Beitz, Secretary; Eugene L. Reed, Treasurer, and August G. Haselbauer, Auditor. Advices to the New York "Times," on Jan. 9, in reporting the meeting, furthermore said: Readjustment of the capital of the Marine Trust Co. was approved by the directors, who ordered a reduction of the par value of the stock from $50 to $32 a share without change of the 250,000 shares outstanding. The capital was set at $8,000,000, surplus $5,000,000, and undivided profits $2,000,000. The stockholders approved a plan to value all securities at market, all known losses to be charged off and reserves not appearing in statements to be listed as doubtful assets. Stockholders of the Liberty Bank of Buffalo, Buffalo, N. Y., were told by George G. Kleindinst, the President, at their annual meeting last week, that the bank is participating In the plan of President Roosevelt to 'have all banks take funds of the Reconstruction Finance Corporation, and it is selling to the RFC $3,000,000 of debentures, according to Buffalo advices, on Jan. 13, to the "Wall Street Journal," which added: With the $3,000,000 obtained from the RFC a readjustment of the capital stock will be effected. First National Bank & Trust Co. of Rochester, N. Y., has taken no action with respect to the sale of preferred stock to the Reconstruction Finance Corporation because it has sufficient capital funds at present, Thomas R. Dwyer,President, told the stockholders, according to Rochester advices, on Jan. 17, which continued: "When the general situation makes an increase in the bank's capital funds appear advisable, directors will have a specific proposal for your consideration," he said. If the present trend in business continues, the bank may be able to declare an initial dividend this year, he adds, but "it must be borne in mind that the management must consider the cost to the bank of its membership in the Federal Deposit Insurance Corporation. This is an unknown quantity and until it can be more definitely ascertained, prudence will dictate the conservation of earnings." Stockholders of the National Shawmut Bank of Boston, Mass., at their recent annual meeting passed a resolution approving action of the directors in causing the bank to become a member of the Federal Insurance Deposit Fund on Jan. 1 last, and a resolution authorizing the directors at their discretion to become a member of the Permanent Insurance Fund on July 1 1934. Twenty three directors were re-elected. At the organization meeting held subsequently, the old officers headed by Walter S. Bucklin, President, were re-appointed, and two new officers elected, namely Rohl C. Wiggin, Assistant Vice-President, and Horace Scherraerhorn, Assistant Cashier. At their recent annual meeting, stockholders of the United States Trust Co. of Boston, Mass., authorized the issue of $1,000,000 par value of new 5% preferred shares and a reduction of capital represented by common stock from $1,400,000 par to $700,000 par value, according to the Boston "Transcript" of Jan. 9. The proposal to issue the preferred stock Is in accordance with the program for banks outlined by President Roosevelt. The Reconstruction Finance Corporation has offered to purchase the preferred stock at par, it was stated. Several changes were made in the personnel of the Rhode Island Hospital Trust Co. of Providence, R. I., at the regular meeting of the directors of the company held on Jan. 9, according to the Providence "Journal" of Jan. 10, which said: Frederic J. Hunt and Robert T. Downs were elected Trust Officers. Mr. Downs has been in the employ of the company since Mar. 17 1902. He was made an Assistant Trust Officer on Dec. 11 1917. Mr. Hunt has been in the employ of the company since June 1916. He has been an Assistant Trust Officer since Dec. 12 1922. Charles A. Post was elected an Assistant Secretary. Employed by the trust company in April 1926, he has for a number of years been an Assistant Trust Officer. Frederick A. Atkinson, elected an Assistant Trust Offleer has been in the employ of the company since August 1918. Edwin F. Morgan was made Manager of the Savings Department. He has been in the employ of the Rhode Island Hospital Trust Co. since August. 1911. Ian. 20 1934 Arthur L. Peck, a Vice-President of the High Street Bank & Trust Co. of Providence, R. I., was given the additional title of Trust Officer, succeeding in that capacity the late Walter C. Nye, at the annual meeting of the directors of that bank on Jan. 9, while Victor H. Frazier (Secretary and Treasurer) and Lovett C. Ray (Assistant Secretary and Assistant Treasurer) were made Assistant Trust Officers, according to the Providence "Journal" of Jan. 10. Other officers of the institution are as follows: Henry A. Grimwood, President; William A. Hathaway, Vice-President, and Howard A. Jepson, Assistant Treasurer. We learn from the Hartford "Courant" of Jan. 10 that at the 142nd annual meeting of the Stockholders of the Hartford National Bank & Trust Co. of Hartford, Conn., held recently, Robert B. Newell, in presenting his annual report stated that the resources of the institution amounted to $54,000,000 and deposits to $44,000,000, the latter showing an increase of $5,000,000 over 1932. The bank's capital is $4,000,000, and surplus, undivided profits and reserves amount to $4,600,000. During the year the trusts administered by the Hartford National Bank & Trust Co., Trust Department, increased $15,000,000 and crossed the $100,000,000 mark. Gross earnings were $1,887,244; dividends paid amounted to $400,000. At a subsequent directors' meeting, Francis Parsons, ViceChairman of the Trust Department, declined re-election because of the condition of his health. He continues as a director. Alfred Spencer, Jr., who was Chairman of the executive committee, was made Honorary Chairman of the bank, and Arthur McDonough, who was an Assistant Cadhler, was appointed Assistant Secretary. John 0. Enders, Chairman of the Board; Henry T. Holt, ViceChairman; Robert B. Newell, President, and associate officers were re-elected, it was said. Judge Frederick M. Peasley of the Superior Court on Jan. 5 granted the First National Bank & Trust Co. of New Haven, Conn., receivers for the Broadway Bank & Trust Co. of that city, permission to transfer funds aggregating $100,000 from the commercial branch of the defunct bank to the savings deposits, so that a dividend of 10% can be paid shortly to all savings depositors. A motion for permission to pay the dividend of 10% on the savings accounts was also granted. The New Haven "Register" of Jan. 5, from which the foregoing is taken, went on to say: In presenting the motion counsel for the First National Bank & Trust Co., stated that in order to pay a dividend of 10% on the savings accounts, funds aggregating $110,000 must first be transferred from the commercial accounts to the savings accounts. This transfer would be temporary, counsel for the receiver revealed. We learn from the New Haven "Register" of Jan. 5 that Judge Frederidhs M. Peasley of the Superior Court on that day granted a motion filed by the New Haven Bank, N. B. A., of New Haven, Conn., receivers for the West Haven Bank & Trust Co., to pay a dividend of 10% on the commercial accounts. This dividend, it was said, would be paid immediately to all commercial accounts including certificates of deposit. The paper mentioned continued: Counsel for the New Haven Bank, N. B. A., revealed that the receivers had on hand funds aggregating $86,347.60, from which a dividend of 10% could be paid to the commercial accounts. The payment of a 10% dividend would require but $64,405.50, leaving a small balance on hand, counsel for the receiver revealed. Judge Peasley allowed the motion. Stockholders of the Pennsylvania Co. for Insurances on Lives and Granting Annuities of Philadelphia, Pa., at their annual meeting on Jan. 15 approved the proposed merger of the Main Line Trust Co. of Ardmore, Pa., with the institution, according to the Philadelphia "Ledger" of Jan. 16. Under the merger plan the Ardmore bank becomes a branch of the Pennsylvania Co. The plan is subject to the approval of Dr. William D. Gordon, State Secretary of Banking for Pennsylvania, and the Federal Reserve Board. When consummated, it is said, the merger will establish for the first time a branch of a Philadelphia banking institution outside the limits of the city. In his annual report to the stockholders, C. S. W. Packard, President of the company, announced net earnings for the 12 months ended Nov. 30 1933 as $1,977,851, from which dividends amounting to $1,442,000 were paid, leaving net profits of $535,851, which amount was credited to undivided profits. Financial Chronicle Volume 138 Charles H. Ewing, President of the Reading Co., and Philip C. Staples, President of the Bell Telephone Co. of Pennsylvania, were added to the Board of Directors. Four directors, Robert K. Cassatt, Robert E. Glendenning, John S. Newbold and Horatio G. Lloyd, resigned owing to conditions imposed under the Federal Banking Act, while John E. Zimmerman, President of the United Gas Improvement Co., resigned from the directorate on account of pressure of other business. At the annual meeting of the stockholders of the Forbes National Bank of• Pittsburgh, Pa., former Governor John S. Fisher was elected a director, while George H. Campbell and Howard M. Johnson, retired, according to the Pittsburgh "Post-Gazette" of Jan. 10. Changes in the personnel made at the directors' meeting which followed were: Paul C. Harper, formerly Vice-President and Cashier, elected Vice-President to succeed George H. Campbell who retired, and J. N. Garber, heretofore an Assistant Cashier, promoted to Cashier to succeed Mr. Harper. The Comptroller of the Currency on Jan. 11 chartered the First National Bank of Dickson City, Dickson City, Pa., with capital of $100,000. The new institution replaces the Dickson City National Bank. J. J. O'Connor is President and F. M. O'Connor, Cashier. Dr. William McClellan, President of the Potomac Electric Power Co., was elected a director of the Riggs National Bank of Washington, D. C., at the stockholders' annual meeting on Jan. 10. All other directors were re-elected. The stockholders also unanimously ratified the issuance of $1,500,000 5% preferred stock as recommended by the directors. The directors of the Second National Bank of Washington, D. C., on Jan. 10 advanced Jacob Scharf from Vice-President to Executive Vice-President, and reappointed all the other officers of the institution, according to the Washington "Post" of Jan. 11. They are: • Victor B. Deyber, President; William M. Hannay, Vice-President; Edward F. Colladay, Trust Officer and Counsel; William B. Wolf, Assistant Trust Officer; George M. Emmerich, Secretary of the Board; W. W. Marlow, Cashier and J. K. Seyboth, Fred S. Beyer, Joseph R. Fitzpatrick, Gerald E. Keene, Steuart S. Ogilvie, Assistant Cashiers. Stockholders of the State-Planters Bank & Trust Co. of Richmond, Va., at a special meeting held Jan. 10, immediately following the annual meeting, approved and ratified the recommendation of the institution's Board of Directors that $2,000,000 in preferred stock be issued. Stockholders will be given an opportunity to subscribe prorata to the offering, which the Reconstruction Finance Corporation has offered to purchase in whole or in part. The Richmond "Dispatch" of Jan. 11 from which this is learnt furthermore said in part: With the preferred stock issuance, the institution will have a capital structure of $4,000,000, President Julien Hill told stockholders. Stockholders of the Virginia Trust Co. of Richmond, Va., approved on Jan. 16 the sale of $700,000 of preferred stock to the Reconstruction Finance Corporation. A dispatch from that city to the New York "Times," from which this is learnt, went on to say: The company's new capital structure will be: Preferred stock, $700,000; common stock, $500,000; surplus and undivided profits, $350,000; reserves, $600,000. --4-- The Fifth-Third Union Trust Co. of Cincinnati, Ohio, on Jan. 9 announced that William M. Thede, heretofore Secretary, had been made Vice-President, and that Henry J. Mergler, formerly an Assistant Treasurer, had also been named a Vice-President, according to Cincinnati advices to the New York "Times". W. A. Hollington, heretofore Executive Vice-President of the First National Bank & Trust Co. of Findlay, Ohio, has been made President of the institution, succeeding the late R. J. Berry, according to advices from that place on Jan. 11, appearing in the Toledo "Blade", which added that Mr. Hollington had been a banker in Findlay for 20 years. Directors and officers of The National City Bank of Cleveland, Cleveland, Ohio, were re-elected at the respective annual meetings of the stockholders and directors of the institution last week, and the stockholders voted to reduce the dividend on the preferred stock from 6 to 5%. The Cleve- 453 land "Plain Dealer" of Jan. 10 in reporting tne meetings said in part: Sidney B. Congdon, President, The National City Bank, told the stockholders that the bank had "weathered successfully one of the most trying years of its 88 years of existence." Mr. Congdon pointed to an increase in deposits from $28,849,404 to $74,833,963, and enlargement of the bank's services, quarters and personnel. He stated that in spite of extraordinary expenses and unfavorable business conditions, operating loss for the year was small and the bank is now operating at a profit. The operating loss was $21,831. In addition, losses on loans and depreciation in securities totaling $805,607 were charged off, and reserves for contingencies after those charges, were increased by $428,982 to $1,040,713. "Your bank," President Congdon stated, "maintained an unbroken record of normal payments to depositors until the President's proclamation declaring a banking holiday became effective. It was promptly licensed to reopen March 13." Twenty-five directors were elected at the annual stockholders' meeting of the Central United National Bank of Cleveland, Ohio, last week, a reduction from fifty-three in compliance with the new Banking Act. C. E. Sullivan, Chairman of the Board, announced that the bank's affiliate, the Central United Company, would be placed in liquidation. Mr. Sullivan was quoted in the Cleveland "Plain Dealer" of Jan. 10 as saying: There is a slow but gradual improvement in business in Northern Ohio going on daily. Values of almost every kind and character of property have been difficult to appraise, but this situation is changing for the better. Announcing that it was their desire to have H. S. Leyman associated with the bank's management in matters of policy, directors of the First National Bank of Cincinnati, Ohio, on Jan. 10 appointed Mr. Leyman, Chairman of the Board, according to the Cincinnati "Enquirer" of Jan. 11. T. J. Davis, who had been Chairman of the Board, became President, succeeding J. J. Rowe, who was made a Vice-President. Other senior officers re-elected were Percy E. Kline and Robert McEvilley, Vice-Presidents, and A. R. Luthy, Cashier. One other change was announced, namely the promotion of C. E. Klensch to Assistant Cashier. He formerly was in charge of the bank's credit department. In announcing the election of Mr. Lkyman, the directors said: He does not expect to take any active part al the routine affairs of the bank, but will be more closely identified for the purpose of conferring in regard to policies. The "Enquirer" went on to say: Mr. Leyman has long been identified with the business life of the community, for many years operating the Leyman Buick Co., which was later purchased by General Motors Corporation. He is President of the Hotel Gibson Co., the First National Bank Building, of the Leyman Corporation and H. S. Leyman Co., investment holding companies. Mr. Davis came to Cincinnati in 1893 from Catlettsburg, Ky., joining the old Fifth National Bank. He went with the First National in 1902 as Cashier, and has taken a prominent part in the business and civic affairs of the community, serving on the directorate of many of Cincinnati's industrial companies. He is on the Board of the Union Central Life Insurance Shareholders of the Fletcher Trust Co. of Indianapolis, Ind., at their recent annual meeting authorized the directors to sell to the Federal Government $1,000,000 in 20-year 5% capital debentures subordinated to deposits and to reduce surplus in lik., amount by writing down assets and setting up reserves, as reported in the Indianapolis "News" of Jan. 9 which also quoted Evans Woollen, the company's President, in his annual report as saying that $500,000 in preferred stock, issued by the Fletcher Savings & Trust Building Co. when the company's main office building was constructed in 1914, had been retired by payment in full. Directors of the Continental Illinois National Bank & Trust Co. of Chicago, Ill., late on the afternoon of Jan. 12 unanimously elected Walter J. Cummings Chairman of the Board of Directors. At the stockholders' annual meeting held earlier on the same day, Mr. Cummings and seven others were elected new members of the Board. The election of the new directors was not unanimous, one unidentified stockholder objecting to making it unanimous by acclaim, and the motion was withdrawn, following which the votes were cast in the usual manner. After 1,800,000 out of a possible 2,500,000 votes had been cast for the new directors, 1,500,000 of them by the Reconstruction Finance Corporation, Mr. Cummings was asked to appear before the shareholders, and his appearance was greeted with applause. In a short speech, as quoted in Chicago advices on Jan. 12 to the New York "Herald Tribune" (from which the foregoing is also taken) Mr. Cummings said: "While I never expected a reception such as this, I assure you it is deeply appreciated. I hope to make this not the largest bank in the country but the safest bank in the country. I look forward to the day when the officers and directors can safely consider resuming dividends again. 454 Financial Chronicle "I hope that at our meeting next year conditions will be sufficiently favorable to have made dividends a possibility. I hope that when I come back to you a year from now you will be satisfied with the report I will be able to present. If you are not, I will be glad to step aside and give some one else a chance." The number of directors was reduced from 34 to 25, the maximum permitted under the new Banking Act. In addition to Mr. Cummings, the new members of the Board are: John Quincy Adams, land owner, who has important holdings in Iowa. He resides in Chicago. S. T. Bledsoe, President, Atchison, Topeka & Santa Fe Railway. Edward A. Cudahy, Jr., President, Cudahy Packing Co. Reuben G. Danielson, Cashier. Continental Bank. Edward Landsberg, President, United States Brewing Co. Judson F. Stone, agent of the McCormick estates. Willoughby Walling, President, Personal Loan & Savings Bank. The dispatch continuing said: Mr. Cummings left to-night (Jan. 12) for Washington to conclude his affairs as Executive Assistant to the Secretary of the Treasury and as Chairman of the Federal Deposit Insurance Corporation. His resignation will take effect January 15, and he will be back here Feb. 1 to assume command of the Continental. Before taking over his duties at the bank. Mr. Cummings will also resign from the boards of many industrial companies, including the Cnnrmings Car & Foundry Co.. which he founded. The selection of Mr. Cummings as Chairman of the Board of the Continental Illinois National Bank & Trust Co. by the Reconstruction Finance Corporation was noted in last week's issue of the "Chronicle", page 273. Nineteen directors of the Harris Trust & Savings Bank of Chicago, Ill., were re-elected at the annual meeting of the company on Jan. 10, according to the Chicago "Journal of Commerce" on Jan. 11. Two former members of the Board, John R. Macomber of Boston and Harry M. Addinsell of New York, requested that they not be elected as their personal plans were indefinite and they contemplate entering the securities business. A total board membership of 22 was authorized as in the past, leaving three vacancies, It was said. Following the stockholders' meeting the directors met and named the same officers for the coming year. In addition the following promotions were made: Harold Eckhart. Secretary, to Vice-President, while continuing as Secretary; Watson H. Vanderloeg, Assistant Vice-President, to Vice-President; Lynn Lloyd, Assistant Secretary, to Assistant Vice-President, and Norman N. Feltes and Randolph G. Owsley made Assistant Cashiers. The paper mentioned went on to say: A. W. Harris, Chairman, told stockholders that holders of 99.96% of the capital stock had ratified the increase in surplus by $1,000,000, of which $100,000 came from undivided profits and $900,000 from liquidation of the N. W. Harris Co. Shareholders ratified expenditures of $16,548 for charity during 1933. Thor R. Thorsen has been appointed President of the Western State Bank of Cicero, Ill., in lieu of John W. Jedlan, who resigned in order to return to his law practice, according to the Chicago "News" of Jan. 9 which added: Mr. Jedlan has been connected with the bank since 1913. He will continue as a director. The Sorento National Bank at Sorento, Ill., is being liquidated, according to the following dispatch from Litchfield. Ill., on Jan. 6 to the Chicago "Tribune": Lack of business in the Sorento community has caused stockholders to liquidate the Sorento National Bank, organized in 1914. Failure of mines In the vicinity have helped to make operations unprofitable. Melvin B. Ericson was this week elected a director of Central Illinois Securities Corp., of Chicago, Ill., replacing Henry M. Dawes, who declined to be a candidate for re-election. Other directors were re-elected. George B. Everitt, formerly President of Montgomery, Ward & Co., was elected Chairman of the Board of the Merchandise Bank & Trust Co., Merchandise Mart, Chicago, Ill., of which he has been a director, at the recent annual meeting. He succeeds John J. Abbott, Vice-President of the Continental Illinois National Bank & Trust Co., who is required to relinquish his post under the new Banking Act. This also will mean that Mr. Everitt will be one of those retiring from the Continental Illinois Board. The Chicago "News" of Jan. 11, in reporting the above furthermore said: Other directors who have withdrawn from the Merchandise Bank bemuse of the provision of the new act are Monroe F. Cockrell, Milton S. Florsheim, Fred W. Sargent and L. Lewis Cohen. The other five directors were reelected, as were all officers. Effective Dec. 28 1933 the Alpena Trust & Savings Bank of Alpena, Mich., changed its title to the Alpena Savings Bank. Jan. 20 1934 The new .National Bank of Detroit, Detroit, Mich., earned gross income of $3,938,108.69 for the period from March 24 last to Dec. 31 1933, Walter S. McLucas, President of the institution reported at the first annual meeting of the stockholders on Jan. 9. Of this gross amount, $630,867.43 was set aside to amortize premiums paid for securities purchased, leaving income for the initial nine months of the bank's operations of $3,307,241.26. Net transfers to undivided profits was $408,915.81 after deductions for expenses, charge-off of losses, setting up of reserves and allowance for preferred stock dividends. Stockholders accepted with regret the resignation of Walter P. Chrysler and James McEvoy from the Board of Directors. Fourteen directors were re-elected. At the initial annual meeting of the directors !held Jan. 15, Alfred T. Wilson was promoted to a Vice-President, according to the Detroit "Free Press" of Jan. 16, which added: Mr. Wilson had been an Assistant Vice-President since the organization of the bank. All other officers were re-elected. A charter was issued by the Comptroller of the Currency on Jan. 8 to The Miners' First National Bank of Ishpeming, Ishpeming, Mich. The new bank is capitalized at $100,000 and succeeds The Miners' National Bank of Ishpeming. S. M. Cohodas and C. H. Moss are President and Cashier, respectively, of the new bank. The following directors were elected on Jan. 9 by stockholders of the First Wisconsin National Bank of Milwaukee, Wis., reducing the directorate from 40 to 25 members in compliance with the Banking Act of 1933: Dr. C. E. Albright R. B. Brown Wm. M. Chester Walter Davidson Albert C. Elsor Otto H. Falk Oscar Greenwald Harry S. Johnston Walter Kasten John Le Faber Gustave Pabst Ludington Patton Cyrus L. Philipp Fred C. Pritzlaff Harold H. Seaman Clement C. Smith L. It. Smith Henry M. Thompson Erwin C. Uihlein Joseph E. liihlein Robert A. Uihlein Wm. B. Uihlein Geo. D. Van Dyke Fred Vogel, Jr. S. B. Way The foregoing were also elected directors of the First Wisconsin Trust Co. (the bank's affiliated institution), together with George D. Luhman, Robert Camp and Charles M. Morris. In his report to the stockholders, Walter Kasten, President of the First Wisconsin, said in part: The year 1933 will long be remembered 08 a most difficult one for the American banking business. It witnessed the climax of the period of deflation through which the world has been passing for several years; namely, the closing of all banks by Presidential proclamation on Mar. 6. The sound banks were re-opened promptly. Public confidence in banks revived, and in order further to assure depositors the Government has provided for insurance of deposits through the Federal Deposit Insurance Corporation, the temporary insurance plan being operative since Jan. 1 1934, and the permanent plan to go into effect on July 1 1934. This bank has qualified under the Banking Act of 1933, and the funds of each depositor are now insured up to and including $2,500 by the Temporary Federal Deposit Insurance fund. As an additional measure intended to improve the banking structure of the country and incidently to widen the basis of banking credit, the Government has asked banks generally to sell preferred stock to the Reconstruction Finance Corporation. A number of the larger New York and Chicago banks have already completed negotiations whereby the R. F. C. becomes a bolder of preferred stock in their institutions. The First Wisconsin has also conferred with the R. F. C. regarding the sale to it of preferred stock, but no definite conclusions have been reached up to the present time. . . . Total deposits of the First Wisconsin National Bank at the end of the year were $125,920,555.53. Deposits have been rising steadily since the banking moratorium. At the present rate of increase, it is not unlikely that deposits will equal, if not surpass, our average deposit level for 1932. Obviously, in view of the slack demand for good commercial loans, the profitable employment of these funds is a considerable problem. It has been found advisable. in fact practically necessary, to invest a large proportion of the bank's assets in U. S. Government securities, even though their interest return is very small. At the end of the year, the First Wisconsin's holdings of Government securities amounted to $38,134,266.84 as compared with $18,173,869.45 at the close of 1932. Cash on hand and due from banks totaled $32,575,852.37 on Dec. 30 1933. Thus, the total of cash plus Government securities, two highly liquid items, was $70,710,119.21. It may be expected that with the return of greater business activity the demand for sound commercial loans will Increase; and the First Wisconsin is in a position to meet this demand and, at the same time, operate to the advantage of its stockholders. . . . Walter Kasten,President, and all other officers of the First Wisconsin National Bank were reappointed, with one exception, at the annual meeting of the bank's directors on Jan. 11. The exception is Robert W. Baird, President of the First Wisconsin Co., who resigned as Vice-President and director of the bank in accordance with a provision of the National Banking Act of 1933. Besides Mr. Kasten, the chief officers of the First Wisconsin National Bank are: Vice-Presidents, George C. Dreher, August W. llogk, Joseph U. Lade. man, Roy L. Stone, William K. Adams, Arthur V. D. Clarkson, George E. Fleischmann, George T. Campbell, John R. Stewart, Alfred G. Schultz. Edwin R. Ormsby, Philip P. Edwards; Cashier, A. G. Casper; Comptroller, S. R. Quaden. Volume 138 Financial Chronicle The Milwaukee "Sentinel" of Jan. 12, from which the foregoing is taken, also said: Under the new bank law, the First Wisconsin Co., a security affiliate, must be divorced from the bank by June 16. ... All officers of the First Wisconsin Trust Co. (of which Mr. Kasten is Chairman of the Board), also were re-elected Jan. 11, with the exception of Mr. Baird. Paul J. Leeman, Vice-President and General Manager of the First Bank Stock Corporation, Minneapolis, Minn., and one of the most widely known bankers in the Northwest, died in Minneapolis on Jan. 11, at the age of 50, after a brief illness. Mr. Leeman was also Vice-President and a director of the First National Bank & Trust Co. of Minneapolis, with which he had been connected for more than 30 years. Born in Greene, Iowa, he attended the public schools there and the high school at Kenosha, Wis. Following his graduation from high school Mr. Leeman became a messenger in the First National Bank of Kenosha, where he served for three years. In 1902 he went to the First National Bank & Trust Co of Minneapolis, then the First National Bank, as a clerk in the transit department. He won steady promotion, and in 1909 became an Assistant Cashier and a Vice-President in 1917. He specialized in handling business for correspondent banks of the First National. When the First Bank Stock Corporation was organized in 1929 he was chosen as its chief executive officer. J. Cameron Thompson was re-elected on Jan. 11 President and General Manager of the Northwest Bancorporation (head office Minneapolis). Other officers and directors also were retained. Edward W. Decker, who was Chairman of the Board and President until six months ago, declined re-election to the Board. Minneapolis advices to the New York "Times", reporting this, added: The stockholders approved the arrangement with the R. F. C. for the purchase by it of 622.900,000 of preferred stock of banks in the Bancorporation chain and for a loan of $3,000,000 to the Union Investment Co. a subsidiary. Herbert L. Horton, formerly Vice-President, was advanced to the Presidency of the Iowa-Des Moines National Bank & Trust Co., Des Moines, Iowa, at the recent annual meeting of the directors, according to advices from Des Moines on Jan. 11 to the Chicago "Journal of Commerce", which continuing said: He succeeds W. H. Brenton, recently named Vice-President of Northwest Bancorporation of Minneapolis. The local bank is the third largest affiliate of Northwest Bancorporation. Mr. Brenton will continue his connections with the Iowa-Des Moines National Bank & Trust Co. as a Vice-President. He also was re-elected President of the First National Bank of Perry, Iowa. The voluntary liquidation of the Capitol Hill State Bank of Oklahoma City, Okla., was announced on Dec. 30 1933 by W. J. Barnett, State Bank Commissioner for Oklahoma, according to the "Oklahoman" of Dec. 31 last. J. E. Moore. President of the institution, was quoted as saying: "It Is a voluntary liquidation and depositors will be paid 60 or 65% in a few days and the remainder shortly thereafter." The paper mentioned continued: The bank assets amount to $537,000 and its deposits are about $460,000, Mr. Moore said. A formal statement was issued to the effect that the 'directors of the bank had decided "not to take advantage of the provision of the new banking act," and accordingly would go into voluntary liquidation under supervision of the State Banking Department. T. G. Taylor, Assistant to the Bank Commissioner will take charge of the bank, and as soon as possible, probably Jan. 5, will accept claims of depositors. First payments will be in the amount of approximately 60% of Valances. "The It. F. C. has agreed to advance the remaining 40% to depositors as soon as necessary legal details are complete." 455 and affiliated companies, anti H. L. Standeven, the Trust Officer. Tulsa advices on the date named to the New York "Times,"from which the above information is obtained, went on to say: The information against the men were filed in Common Pleas Court by James M. Springer, a special attorney appointed by Governor Murray, and this came at the conclusion of a special audit by accountants named by the Governor. Seven charges were specified, involving small sums left in trust estates by individuals and allegedly put to other uses by officers of the company. Some of the accused directors appeared before Judge Bradford Williams as soon as they heard of the charges and were released on bonds of $4,000 each. Feb. 5 was designated for the preliminary trials. Mr. Springer charged that the audit revealed more than 900 similar instances, of which all except 192 had been outdistanced by the Statute of Limitations. He indicated that more charges would follow, based on the remainder of the live issues. He declared that because the accused men were directors at the time of the supposed misappropriation of money they were responsible under the State laws. The "Times" added: H. F. Sinclair could not be reached yesterday (Jan. 17) as he is in Florida, but his office issued a statement which said: "Mr. Sinclair has not been active in the management of the affairs of the Exchange Trust Co. since he left Tulsa, approximately twenty years ago." The Exchange Trust Co. was placed in the hands of the Oklahoma Banking Department by its directors on June 30 last, as noted in the "Chronicle" of July 15, page 439. The First National Bank in St. Louis, St. Louis, Mo., on Jan. 9 reduced its Board of Directors from 56 to 25, in compliance with requirements of the 1933 Banking Act, at the annual meeting of the stockholders, according to the St. Louis "Globe-Democrat of Jan. 10. F. 0. Watts was retained as Chairman of the Board at the subsequent directors meeting and Walter W. Smith as President of the bank. All the new directors were members of the old Board, it was stated. 'We learn from the St. Louis "Globe-Democrat" of Jan. 10 that the 87th annual meeting of the stockholders of the Boatmen's National Bank of St. Louis, Mo., on Jan. 9, all the directors were re-elected with the exception of Aaron Waldheim, whose name was omitted at his own request. He explained he wishes to curtail his business activities. Vacancies caused by his retirement and the death last year of Samuel D. Capen were filled by the election of F. Lee Major and Albert Wagenfuehr, Vice-Presidents of the bank, as board members. All officers of the institution, it was stated, were reelected at a subsequent meeting of the Board of Directors: Tom K. Smith is President. The City National Bank & Trust Co. of Kansas City, Mo., with capital of $300,000, was chartered by the Comptroller of the Currency on Jan. 10. The institution which represents a conversion to the National System of The City Bank & Trust Co., is headed by R. C. Kemper, while G. C. Kopp is Cashier. Merle Robertson, formerly Executive Vice-President of the Liberty Bank & Trust Co. of Louisville, Ky., was promoted to the Presidency of the institution at the directors annual meeting held Jan. 1. Mr. Robertson succeeds John E. Huhn, who tendered his resignation in order to devote his full time to the Liberty Fire Insurance Co. of which he is President. Other officers of the Trust Company, headed by George C. • Weldon, Chairman of the Board of Directors are: VicePresidents, R. M. Fible, E. F. Kohnhorst, W. S. Kohnhorst, The American National Bank of Shawnee, Shawnee, Okla., F. C. Dorsey and J. P. Marmor ; Vice-President and Cashier, was granted a charter by the Comptroller of the Currency W. A. Millican ; Assistant Vice-Presidents, W. J. Raeuchle, on Jan. 6. The institution, which succeeds The State Na- R. L. Wyckoff, E. G. Barker, I. W. Dobbins, Jr., A. H. Frenke tional Bank of Shawnee, is capitalized at $200,000, consisting and W. C. Fisher; Assistant Cashiers, W. F. Dunlap, H. A. of $100,000 preferred stock and $100,000 common stock. C. E. Sheer, John A. Reeb, Joseph W. Wrocklage and E. M. EisenBowlby and A. J. Guyton are President and Cashier, respect- beis; Auditor, Fred A. Strobel. ively, of the new bank. The Louisville "Courier-Journal" of Jan. 2, from which • the above information is obtained, went on to say in part: Mr. Robertson has been a resident of Louisville lor the last two and a Harry F. Sinclair, oil operator, and twenty-four other directors and officers of the defunct Exchange Trust Co. half years. Prior to that time he was Vice-President of the Citizens' National Bank of Englewood, N. J. ; Credit Manager of the Chemical Bank of Tulsa, Okla., were charged on Jan. 18 with the embezzle-. & Trust Co. of New York and Vice-President of the National Shavrmut of Boston. He became identified with the Liberty Bank & Trust Co. in Sept. ment of $23,869.93 from the institution. The list for whom warrants were issued includes Earl NV. Sinclair of New York, 1932, and was elected Vice-President of the bank at the annual meeting last year. He was elected by the Board to the position of Executive Vicea brother of Harry F. Sinclair and a director of the Con- President during the past year. which solidated Oil Corporation, of Harry F. Sinclair is Mr. Robertson also previously has been a director of the bank and a Chairman, and Frank Haskell of Sharon, Conn. The others member of the Executive Committee. In connection with his election as President, Mr. Weldon made the following statement: are leading Oklahoma oil and business men. They include "The election of Mr. Robertson as President of the bank assures the Harry H. Rogers, former President of the Exchange Bank sound management of the institution as well as the continuation of its rep- 456 Financial Chronicle utation for its constructive attitude and spirit of helpfulness and cooperation." The Board elected F. Joseph Herrmann, Chairman of the Executive Committee. He has been a director of the bank for a considerable time and is active in the affairs of the institution. Stockholders of the First National Bank of Atlanta, Ga., at their recent annual meeting re-elected all the old directors, according to the Atlanta "Constitution" of Jan. 10. At the directors meeting which followed Robert F. Maddox resigned as Chairman of the Board of Directors, his resignation being accepted by the directors in keeping with a promise made to Mr. Maddox when he was elected to the post last August. Although relieved of executive responsibilities, Mr. Maddox retains his financial interest in the bank, of which he is one of the largest stockholders, and continues as a member of the Board and of the finance committee, his active duties at the bank being divided among other executive officers. All the other officials of the bank, headed by John K. Ottley, President, were reappointed and two of the younger officials, J. Arch Avary Jr. and Frank T. Davis, were promoted to Assistant Vice-Presidents. In regard to the retirement of Mr. Maddox, we quote from the "Constitution" as follows: Appreciation of his "long and illustrious career as a banker" and "his distinguished public and private leadership and high character as a man" were expressed in resolutions unanimously adopted. In accordance with plans that have been made for months Mr. Maddox, who has been a prominent figure in Atlanta banking circles for nearly 45 years, will embark about Feb. 1 on a long deferred vacation. Stockholders of the Trust Co. of Georgia, Atlanta, Ga., at their forty-second annual meeting elected Walter H. Rich and J. G. Dodson, well known Atlanta business men, as directors, according to the Atlanta "Constitution" of Jan. 10. Following the shareholders' meeting the directors re-elected officers, including the promotion of present officials. Henry Wyatt, for many years connected with the company in its municipal bond department, was advanced to Vice-President, In charge of the investment department of the company, and William S. Woods, Assistant Secretary, and Douglas M. Robertson were promoted to Assistant Vice-Presidents in the banking department. Thomas K. Glenn is President of the institution. A proposal to change the par value of the capital stock of the Citizens' & Southern National Bank of Savannah, Ga., from $10 to $100 a share, if the directors during the coming year consider such action desirable, was approved by the stockholders of the institution at their annual meeting last week. The change was recommended by William Murphey, the bank's President. A dispatch from Savannah by the Associated Press on Jan. 10, from which the foregoing is learnt, furthermore said: Par value of the bank stock formerly was $100 but four years ago a split in the stock was authorized by the holders and the par value fixed at $10. As a result of the change the number of stockholders increased and there now are about 3,000. Mr. •Murphey told stockholders the advantage gained had been offset by making it easy to speculate in bank stock and this was why he recommended the directors he given power to make the change. Stockholders approved a recommendation by Mr. Murphey that the capital stock of the Citizens' & Southern Holding Company be increased from $400,000 to $500,000 by transfer of $100,000 from the surplus and undivided profits account to the capital account of the holding company when the directors may deem the action necessary and advisable. Jan. 20 1934 appointed; Dale Graham, formerly Cashier, was elected Vice-President and Cashier; C. F. Niebergall, Vice-President, was made Vice-President and Trust Officer; two additional Assistant Cashiers were appointed, namely, Albert Dazet and B. J. Legett; D. Allen Johnson was made Assistant Trust Officer and J. R. Olsen, Auditor. Other officers re-elected were, Vice-Presidents, J. A. Bandi, D. D. Curran and H. Dabezies, and Assistant Cashier, F. H. Fitzgerald. In regard to the two new directors, the announcement by the bank said in part: Mr. Kemper is Treasurer and General Manager of Sterling Sugars, Inc., of Franklin, La., and is a Director and Vice-President of the Commercial Bank Sc Trust Co. of Franklin. He is a member of the Regional Agricultural Credit Corporation and is past President of the American Sugar Cane League of the United States. Mr. Simmons is Manager of the United States agencies of the Pan American Life Insurance Co. He is also a director of the National Service and Appraisal Co. Harold B. Kountz, heretofore Chairman of the Board and Vice-President of the Colorado National Bank of Denver, Col., has been appointed President of the institution to succeed George B. Berger, who in turn became Chairman, according to Denver advices on Jan. 15 to the "Wall Street Journal". Citizens National Trust & Savings Bank of Los Angeles, Calif., at its annual meeting Jan. 9 reduced its Board of Directors to 25, conforming with the National Banking Act of 1933. The following directors were elected: 31. J. Connell, George W. Walker, Jesse B. Alexander, F. IC. Pfaffinger, Samuel K. Rindge, Herbert D. Ivey, E. C. Wilson, L. J. Christopher, IV. A. Faris, J. B. Leonia, Willits J. Hole, Willis G. Hunt, John G. Mott, Clark J. Bonner. William A. Incas, E. E. Duque, Dr. W. W. Beckett, James A. Gibson, Jr., T. B. Cosgrove, J. M. Hale, Roger Goodan, E. W. Reynolds, Frank A. Garbutt, Eugene P. Clark. E. T. Pettigrew. The new Board met Jan. 11 for the election of officers. M. J. Connell was re-appointed Chairman of the Board; George W. Walker, Chairman of the Executive Committee; and Herbert D. Ivey, President. After the meeting Mr. Ivey announced three promotions, as follows: W. H. Schroeder to Assistant Vice-President, from Assistant Cashier, which office he has held since 1924; A. F. Yaussi, made Assistant Cashier (has been with Citizens since 1927, for several years as branch manager and for the past year engaged in supervisory work among branches), and C. M. MacFarlane, with the bank since 1924, appointed Assistant Secretary. The directors of the Midland Bank Limited (head office London) report that after making an appropriation towards bad and doubtful debts (all of which have been fully provided for) net profits for the year 1933 amounted to £2,266,846, which with £859,397 brought forward from the preceding year, made 13,126,243 available for distribution, out of which the following appropriations amounting to £1,404,880 have been made: To interim dividend, paid July 15th 1933, for the half-year ended June 30 1933 at the rate of 16% per annum, less income tax, £854,880 and to reserve for future contingencies, 1550,000, leaving a sum of £1,721,363, from which the directors recommend a dividend be paid on Feb. 1 next, for the half-year ended Dec. 31 1933 at the rate of 16% per annum less income tax,calling for 1854,880, and a balance be carried forward of £866,483. The promotion of E. P. Taliaferro from Vice-President of the First National Bank of Tampa, Fla., to President of the institution, succeeding R. J. Binnicker, who was made Chairman of the Board of Directors, was reported in Tampa advices on Jan. 15 in the "Wall Street Journal", which went on to say: !The net profits of the Westminster Bank Limited, London, for the past year, after providing for rebate and income tax, and after appropriations to the credit of contingency accounts, out of which accounts full provision for bad and doubtful debts has boon made, amount to £1,464,955. This Mr. Taliaferro is the third of that name to head the 50-year sum, added to £4E0,984 brought forward from 1932, leaves old institution. Sen. James P. Taliaferro, now retired and living in Jacksonavailable the sum of £1,925,939. The dividend of 9% paid ville, was President in the 80s and 90s. T. C. Taliaferro father of the in August last on the £4 shares and 654% on the £1 shares new President, headed the institution until his death in 1928. £582,722. A further dividend of 9% is now declared absorbs • Shareholders of the National Bank of Commerce in New in respect of the £4 shares, making 18% for the year; and 4% on the £1 shares will be paid, Orleans, New Orleans, La., at their recent annual meeting a further dividend of 6Y added two new directors to the Board, namely Charles D. making the maximum of 12H% for the year. £100,000 has Kemper and Ted M. Simmons. The other members of the been transferred to bank premises account, and £200,000 to officers' pension fund, leaving a balance of £460,495 to be directorate are: forward. Comparative figures of profit and loss for carried Clay W. Becicner A. D. Geoghegan Paul Maloney, Jr. the last three follow: H. Thom Cottam Dominick Graffagnino A. Q. Petersen Richard R. Foster Oliver G. Lucas George Plant George Westfeldt L. Kemper Williams At the subsequent directors' meeting A. D. Geoghegan was re-elected Chairman of the Board; Oliver G. Lucas, President, and Clay W. Beckner, Executive Vice-President. Five new Vice-President: L. B. Giraud; W. J. Mitchell; T. F. Began; W. W. Sutcliffe, Jr., and Charles J. Theard were Net profit Brought forward Total available Dividends Bank premises account Contingent fund Officers pension fund Carried forward 1933. 1932. 1931. £1,464,955 /1,495,172 £1,601.822 460,984 431,256 464,301 £1,925,939 £1,926,428 £2,066.123 1,165,444 1,165,444 1,184,867 100.000 100,000 250,000 200.000 200.000 200,000 460.495 460,984 431.256 ./1.925,939 £1,926,428 12,066.123 points to 793%; New York & Harlem, 3 points to 122; Public Service of N. J. pref. (7), 4 points to 96; Union Pacific, 334 points to 121; Ward Baking pref., 3 points to 33, and Wright Aero, 3 points to 20. Following a brief period of irregularity during the forenoon, the stock market again moved ahead on Wednesday, the advances ranging from fractions to 4 or more points. Profit taking appeared from time to time but was readily absorbed as the advance was maintained. During the early trading the amusement, packing and communication shares featured the dealings but later in the day trading interest switched to railroad equipment stocks, motor shares and alcohol issues, all of which moved briskly forward. A few shares moved contrary to the trend but these made little impression on the general list. Railroad stocks were again in demand, Atchison and Union Pacific assuming the lead and specialties were unusuady active, particularly Johns Manville, Celanese and Radio pref. "B." Some of the regular market leaders like American Can and United States Steel were inclined to slow up, and Amer. Tel. & Tel. failed to hold its gain. Among the important advances of the day were Allied Chemical & Dye 35% points to 1535%, American Tobacco pref. (6) 3 points to 113, Celanese Corp. 35% points to 393%, Industrial Rayon 23% points to 85, Public Service of N. J. pref. (5) 2% points to 853/2, Studebaker pref. 4 points to 30, Union Pacific 1 point to 122, West Penn Electric pref. (7) 4 points to 623% and Western Union Telegraph 13/3 to 6034. • Trading moved within narrow limits on Thursday, and while there was a modest rally toward mid-afternoon, most of the active stocks lost part of their gains before the close. Some specialties like packing shares, rubber issues, and a few stocks in the metal group were in good demand, but the list, as a whole, moved around without noteworthy feature. Some selling was apparent from time to time but this made little impression on the market movements. Price changes at the close were small and largely on the side of the decline, the ncessions including among others, Allied Chemical & Dye 23s points to 1503/3, American Water Works pref. 3 points to 65, Federal Mining & Smelting 23.4 points to 92, Homestake Mining Co. 10 points to 324, Otis Elevator pref. 4 points to 92, Sun Oil pref. (6) 2 points to 100 and Norfolk & Western 134 points to 173. Practically every active group followed the lead of the railroad shares as the market resumed its upward swing on Friday. Trading was heavy and as the volume increased, the ticker began to lag from three to five minutes behind the transactions on the floor of the Exchange. Public utilities were not far behind the railroad shares and showed substantial gains as the market closed. There was some evidence of covering by shorts, particularly among the specialties and there was some realizing in evidence from time to time, but the selling failed to check the forward movement. The gains for the day included among others, Allied Chemical & Dye, 23/3 points to 153; American Ice pref., 33/3 points to 42; Atchison, 33/3 points to 703%; Cuban American Sugar pref., 6 points to 37; New Haven pref., 3 points to 34; North American pref., 33/3 points to 43; Public Service of N. J. pref (5), 3 points to 79; Remington Rand pref., 3 points to 44; Utah Copper, 5 points to 65, and Union Bag & Paper, 23/3 points to 483%. TRANSACTIONS AT THE NEW YORK STOCK EXCHANGE, DAILY, WEEKLY AND YEARLY. State, Was. Railroad Number of and Miscall. Municipal & Bonds. Poen Bonds. Shares. Saturday Monday Tuesday Wednesday Thursday Friday Total __ 749,660 3,743,480 3,449,240 2,848,490 2.126,940 3,542.390 §§§§§§ Week Ended Jan. 19 1934. as THE WEEK ON THE NEW YORK STOCK EXCHANGE. Speculative activity in the New York stock market has displayed sharp improvement during the present week, due mainly to President Roosevelt's monetary message to Congress on Monday outlining his intentions with reference to the future of the dollar. On Monday and Tuesday prices advanced on a broad front and the volume of trading was particularly heavy. As the week advanced, the enthusiasm waned down somewhat, though prices again turned upward on Friday. Railroad shares were popular in trading during the forepart of the week, but these gave way later on.to the rubber stocks, chemical shares and mining issues, but again assumed the leadership as the market moved upward. Some realizing cropped out from time to time, but this made little impression on the market movements. Call money renewed on Monday at 1%, and continued unchanged at that rate throughout the week. Indecisive price movements featured the trading during the abbreviated session on Saturday, the drive on motor stocks being a strong factor in the general unsettlement of the market. The opening prices were below Friday's finals, and while there was a modest upturn during the middle of the session, the improvement failed to hold and the market again slipped back. Chrysler was one of the weak spots and dipped about 10 points under its recent top. General Motors, du Pont and other issues closely allied with the motors also slipped back to lower levels. During the first hour there was some buying apparent in the steel group, but these stocks subsequently reacted with the market. Railroad shares were somewhat mixed, with Atchison reacting on profit taking. Public utilities, on the other hand, were stronger, though the changes were small. Oil stocks showed occasional gains and alcohol shares were generally irregular. The changes for the day were largely on the side of the decline, the recessions including among others, Allied Chemical & Dye,3 points to 145; American Safety Razor (3), 2 poirts to 36; American Water Works pref. (6), 23% points to 60; Beatrice Creamery,5 points to 55; Homestake Mining Co., 9 points to 310; Illinois Central pref., 2 points to 35; McKeesport Tin Plate (4), 2 points to 84; Peoples Gas, 13/3 points to 35; Union Bag & Paper Co., 134 points to 44, and United States Mining & Smelting, 17 % points to 973%. The stock market soared upward on Monday following the announcement of the change in monetary policies at Washington. Speculative activity, following a week of drifting, suddenly broadened out and as stocks moved upward, many of the trading favorites registered gains ranging from 2 to 6 points. Steel shares, motor issues, chemicals and railroad stocks were in the foreground most of the day, but the alcohol issues made little progress and were generally under pressure due to a Government suit against United States Industrial Alcohol for taxes due on a large amount of alcohol. Amer. Tel. & Tel. was one of the strong spots, and there was a sharp demand for steel stocks, industrials and other popular shares. Among the day's advances were Air Reduction, 33 4 points to 101%; Allied Chemical & Dye,67 4 points to 1573/3; American Beet Sugar pref., 63% points to 5434; Amer. Tel. & Tel., 5 points to 119; Atchison, 43 4 points to 64; Atlas Powder, 53% points to 413%; Baldwin Locomotive pref.,5 points to 40; J. I. Case Co.,5 points to 7532. Chrysler, 3 points to 533 4; Colorado Gas & Electric, 4 points to 63; Detroit Edison, 4 points to 72; Du Pont, 57 4 points to 983%; General Motors, 2% points to 37; Homestake Mining, 26 points to 336; Johns-Manville, 43% points to 613%; Sloss Sheffield Steel, 6 points to 26; United States Steel, 45% points to 533/3; Western Union Telegraph, 33/3 points to 587 4, and Worthington Pump, 2% points to 243%. Heavy trading again marked the dealings on the New York Stock Exchange on Tuesday, and despite the sharp profit taking, the gains were extended from 2 to 6 or more points above the preceding close. During the opening hour many blocks of stock ranging from 1,000 to 10,000 appeared on the tape, though a slight falling off was apparent as the day progressed, but a subsequent buying movement again swelled the turnover. Railroad issues were the oustanding strong stocks, the group moving forward under the leadership of Atchison and Chesapeake & Ohio, and there was a good demand for United States Steel and other industrial shares. Scattered selling appeared in the alcohol stocks though the group, as a whole, did not show any special weakness. The gains included among others, American Car & Foundry, 2 points to 44; Atchison, 23% points to 663 4;Bon Ami,2 points to 80; Delaware & Hudson, 23% points to 633/3; Federal Mining & Smelting, 334 points to 943/3; Loews pref., 53% 457 Financial Chronicle 00 0-0. -V01.2. WCA=001-,P. 000-4 opp Volume 138 32,059,000 5,302,000 4.366,000 4,708,000 4,370,000 3,891,500 Total Bond Sales. Untied Mates Bonds. 8434,000 3,591,000 2,909,200 3,008,000 2,721.100 904.000 88,333,000 24,903.000 25.253.200 21,983,000 21.047,100 20,334,500 16 AAA 200 583 592 Afla 526 1,196 fon 513_285.300 2121 Mason Salts at New York Stock Exchange. Week Ended Jan. 19. 1934. 1933. Stocks-No. of shares_ 16.455,200 3,911.440 Bonds. Government bonds - - $13,565.300 $14,596,800 State & foreign bonds_ 24,696.500 14,098,000 Railroad dc misc. bonds 83,592,000 36,851.000 Total $121,853,800 865,545.800 Jan. 1 to Jan. 19. 1934. 1933. 28,106,202 13,228,181 $61,720,600 59,699,500 157,982.000 $28,652,700 45,160.000 109,622,700 $279,402,100 $183,435,400 DAILY TRANSACTIONS AT THE BOSTON. PHILADELPHIA AND BALTIMORE EXCHANGES. Boston. Week Ended Jan. 19 1934. Saturday Monday Tuesday Wednesday Thursday Friday. 13,307 47,972 54,211 40.800 35,316 7,724 Total Prey. wk. revised_ Philadelphia. Baltimore. Shores. BondSales. Shame. Bond Sales. Shares. Bond Sales. $1,000 10.000 10,050 2.000 4,500 4,000 5,994 33.888 31.442 20,575 18,165 9,450 $6,000 22,200 24,200 6,000 17,850 1,462 2.924 4.035 1.994 2,202 2,928 $500 1.000 1,100 24,000 18,000 199,330 331,550 119,514 376,250 15,545 $44,600 120.808 $30.500 115.990 59700 9811 S27200 458 Financial Chronicle THE CURB EXCHANGE. Moderate irregularity marked the dealings on the curb market during most of the present week, though the volume of trading has been fairly large and the trend, on the whole, has been toward higher levels. Public utilities have attracted considerable speculative attention and there has been some interest manifest in the oil stocks and miscellaneous industrials. Mining issues have been in fair demand at higher prices. On Saturday trading was comparatively quiet, though considerable profit-taking was apparent, especially in those groups that were prominent in the mid-week rally, such as the public utilities and the wet stocks. Pepperall Manufacturing Co. continued to attract buying and advanced about 2 points at its top for the day. Some of the more active issues managed to register moderate gains but the list, as a whole, was only fractionally above the previous close. Curb stocks were stronger on Monday and moved vigorously upward along a broad front. Public utility stocks were in good demand and moved briskly upward all along the line. American Gas & Electric was the outstanding feature and jumped more than a point at its top for the day. Electric Bond & Share, Niagara Hudson and United Light & Power A also moved sharply ahead though the gains were somewhat smaller. Mining shares developed a stronger tone, the active stocks including Aluminum Co. of America, Newmont and Lake Shore mines, all of which registered advances before the close. Oil shares were strorg and active and advanced under the leadership of Gulf Oil of Pennsylvania, Standard of Indiana and Humble Oil. Specialties were irregular, but wet stocks were quiet and made little pro zress. Toward the end of the session the list broadened out to a considerable extent and large blocks of stocks were turned over at higher prices. Price changes were small on Tuesday though the market continued broad and active throughout the session. Public utility shares moved within narrow channels around previous closing levels, though a few of the more active stocks like American Gas & Electric and Niagara Hudson showed small gains. Electric Bond & Share and United Light & Power A were practically unchanged from the previous close. Changes in the oil group were comparatively small and usually on the side of the decline. Some specialties were moderately firm and the wet stocks like Hiram Walker, Distillers Seagram and a number of other issues in the group were generally down on the day. Trading was in reduced volume and prices irregularly higher during a good part of the session on Wednesday. There were a few isolated stocks that moved toward lower levels but the list, as a whole, was higher though the gains at no time were particularly noteworthy. Gulf Oil of Pennsylvania was slightly higher but Standard Oil of Indiana was down fractionally at the close. American Gas & Electric was off on the day, Electric Bond & Share was fairly firm and moved to higher levels, while stocks like Niagara Hudson and American Gas & Electric were inclined to ease off. Alcohol issues, moving ahead under the guidance of Hiram Weikel,were moderately higher ard there was a fair demand f ir some of the more active of the mining stocks. Small gains and broad trading were the outstanding features of the dealings on Thursday, and while there was considerable irregularity in evidence during most of the session, the tone, at times, was firm and fractional gains were recorded by some of the trading favorites before the closing hour. Oil stocks were particularly active, Standard of Indiana, Humble Oil and Internatioral Petroleum showing moderate gains at the close. Mining stocks were higher, Newmont scoring a gain of more than a point while Lake Shore and Aluminum Co. of America were higher by fractions. Public utilities made gains at times, though most of the improvement was small. Alcohol stocks like Hiram Walker and Distillers Seagram were down on the day. Oil stocks and public utilities were the outstandirg strong stocks as the curb market advanced along a broad front on Friday, the rise carrying a number of the market leaders forward from fraction to 3 or more points at their best for the session. In the public utility group American Gas & Electric was higher by about 2 points and there were smaller gains made by Electric Bond & Share, Niagara Hudson and United Light & Power. The feature of the oil group was Gulf Oil of Pennsylvania which surged forward about 3 points at its peak. Mining stocks moved forward under the leadership of Aluminum Co. of America, Lake Shore Jan. 20 1934 Mines and Newmont Mining, while thq wet stocks were featured by the advance of Hiram Walker and Distillers Seagram. The range for the week was generally on the side of the advance, the strong stocks including such prominent issues as Aluminum Co. of America 74 to 85, American Beverage, 13% to 25 %; American Gas & Electric, 23% to 28; American Laundry Machine, 12 to 133 %, American Light & Traction, 1334 to 1534; American Superpower, 234 to 3; Atlas Corp., 1134 to 125 %; Central States Electric, %; Cities Service, 234 to 2%; Commonwealth 134 to 13 Edison, 47 to 52; Consolidated Gas, Baltimore, 5534 to 5934; Cord Uorp., 7 to 73%; Creole Petroleum, 10% to 113%; Electric Bond & Share, 15 to 17; Ford Of Canada A, 1534 to 193 %; Gulf Oil of Pennsylvania, 5934 to 70; Hudson Bay 3 to 38; InterMining, 834 to 93%; Humble Oil (new), 35% national Petroleum, 193 % to 20%;New York Telephone pref., 115 to 11634; Niagara Hudson Power, 53% to 7; Parker Rust 5 Pennsylvania % to 3%; Proof, 55 to 60; Pennroad Corp., 25 Water & Power Co., 47 to 49; Singer Manufacturing Co., 161 to 163; A. 0. Smith, 273% to 3234; Standard Oil of % to 3234; Swift & Co., 1434 to 16; Teck Hughes, Indiana, 313 United Gas Corp., 234 534 to 6; United Founders, % to 1 3 Utility Power, to 234; United Light & Power A, 334 to 4%; 1 to 1%. A complete record of Curb Exchange transactions for the week will be found on page 487. DAILY TRANSACTIONS AT THE NEW YORK CURB EXCHANGE. Week Ended Jan. 19 1934. Stocks (Number of Shares). 131,250 $2,268,000 545,940 5,264,000 587.275 5,673.000 367,255 4,709,000 306,800 4,289.000 473,250 4,575,000 Saturday Monday Tuesday Wednesday Thursday Friday Total Bonds (Par Value). Foreign Foreign Domestic. Government. Corporate. 173,000 259,000 363,000 177,000 141,000 190,000 Total. $84.000 $2,925,000 150,000 5,682,000 111,000 6,147,000 284,000 5,170,000 195,000 4,625,000 287,000 5,002,000 2,411.770 $26,778,000 $1,163,000 $1,120,000 $29,051,000 Sales at New York Curb Exchange. Jan. 1 to Jan 19. Week Ended Jan. 19. 1934. 1934, 1933. 1933. 543,136 2,411,770 Stocks-No. of shares. Bonds. Domestic $26,778,000 $20,264.000 814,000 Foreign government 1,153,000 1,285,000 1,120,000 Foreign corporate 4,470,675 1,823,131 $52,894,000 2,801,000 3,032,000 161,404,000 3,068,000 3,595,000 $29,051,000 $22,363,C00 $58,727,000 $68,067,000 Total COURSE OF BANK CLEARINGS. Bank clearings this week will again show an increase as compared with a year ago. Preliminary figures compiled by us, based upon telegraphic advices from the chief cities of the country, indicate that for the week ended to-day (Saturday, Jan. 20) bank exchanges for all the cities of the United States from which it is possible to obtain weekly returns will be 4.1% above those for the corresponding week last year. Our preliminary total stands at $4,712,480,695, against $4,528,849,379 for the same week in 1933. At this center there is a gain for the five days ended Friday of 3.3%. Our comparative summary for the week follows: Clearings-Returns by Telegraph. Week Ending Jan. 20. 1934. 1933. Per Cent. New York Chicago Philadelphia Boston Kansas City St. Louis San Francisco Los Angeles Pittsburgh Detroit Cleveland Baltimore New Orleans $2,481,189,878 $2,401,153,984 161,688,873 148,021,956 207,000,000 240,000,000 177,000,000 178,000,000 53,263,459 49,979,173 56,300.000 53,600,000 86,982,000 72,600,000 No longer will re port clearings 64,912,008 55,373,300 55,323,873 46,730,111 46,255,827 45,693,734 39,151,018 40,420,651 24,097,000 27,061,346 Twelve cities, 5 days Other cities, 5 days $3,453,163,936 473,903,310 $3,358,634,344 439,319,220 +2.8 +7.9 Total all cities, 5 days All cities, 1 day $3,927,067,246 785,413,449 $3,797,953,564 730,895,815 +3.4 +7.5 84.712 450 fl05 5425 540 a70 .1.4. 1 +3.3 +9.2 -13.8 -0.6 +6.6 +5.0 +10.8 +17.2 +18.4 +1.2 -3.1 -11.0 Complete and exact details for the week covered by the foregoing will appear in our issue of next week. We cannot furnish them to-day, inasmuch as the week ends to-day (Saturday) and the Saturday figures will not be available until noon to-day. Accordingly, in the above the last day of the week has to be in all cases estimated. In the elaborate detailed statement, however, which we present further below, we are able to give final and complete results for the week previous, the week ended Jan. 13. For that week there is a decrease of 6.5%, the aggregate of clearings for the whole country being $4,249,307,327, against $4,542,411,749 in the same week in 1933. Outside of this city there is a decrease of 3.4%, the bank clearings at this center having recorded a loss of 8.2%. Financial Chronicle Volume 138 We group the cities according to the Federal Reserve Districts in which they are located and from this it appears that in the New York Reserve District, including this city, the totals record a decrease of 8.7%, in the Boston Reserve District of 0.5% and in the Philadelphia Reserve District of 21.4%. The Cleveland Reserve District registers a decline of 1.7% and the Richmond Reserve District of 13.0%, but the Atlanta Reserve District enjoys a gain of 17.4%. In the Chicago Reserve District the totals are larger by 0.1%, in the St. Louis Reserve District by 8.4% and in the Minneapolis Reserve District by 4.7%. In the Kansas City Reserve District the increase is 12.4%,in the Dallas Reserve District, 20.9% and in the San Francisco Reserve District 4.7%. In the following we furnish a summary of Federal Reserve districts: SUMMARY OF BANK CLEARINGS, Week Ended Jan. 13 1934. 1934. Inc.or Dec. 1933. 1932. 1931. Federal Reserve nista. 1St BOSt011- - --12 cities 2nd New York_ -12 " 3rd Philadelpla 9 " 4th Cleveland__ 5 " 51/1 Richmond _ 6 " 6th Atianta____10 " 7111 Chicago - - -19 " 8111 St.Louis.-- 4 " 9th Minneapolis 7 " 10th Kansas City 9 " 11th Dallas 5 " 12th San Fran 13 " $ 20t,809,940 2,719,826,083 242,373,181 169,182,189 84,930,352 97.375,931 278,058,516 91,676,906 64.909,671 92,089,167 41,192,651 162,882,740 $ 205.766,787 2,979,551,807 308,435,476 172,0E8,813 97,584,511 82,937,119 277,839,151 84,554,788 62,024,581 81,941,167 34,061,530 155,628,019 S % -0.5 316,429,361 -8.7 4,349,390,526 -21.4 349,872,481 -1.7 249,431,053 -13.0 122,692.496 111,552,201 +17.4 423,501,851 +0.1 109,502,752 +8.4 +4.7 77,524,011 +12.4 114,262,141 +20.9 44,869,168 +4.7 216,261.231 S 442.320,091 5,655,298,502 416,046,066 349,320,507 153,964,506 141,104,742 716,737,137 155,788,404 100,161.963 175,895,539 55.690,143 284,623,649 Total 111 cities Outalde N. Y. City 4,249,307,327 1,614,152,336 4,542,411,749 -6.5 6,485,289,262 1,671,229,428 -3.4 2,253,063,526 8,646,942,249 3,135.845.385 Clinnubt ft2 itItiss 287 OltSt inn 70 IR ISAII 2711 .i.,5 7 217 RAS AcY2 2911614.651 Week Ended Jan. 13. Clearings at1934. Week Ended Jan. 13. Clearings at 1934. 1933, Inc. or Dec. $ $ First Federal Reserve Dist rict-Boston-% Se -Bangor.... 452,807 349,278 +29.6 Portland 1,983,058 2,217.911 -10.8 Sass.-Boston... 178,050,154 177,672,414 +0.2 Fall River _ _ 518,249 608,008 -14.8 Lowell 278,826 308,598 -9.6 New Bedford_ 543,043 559,159 -2.9 Springfield..... 2,718,582 +1.1 • 2,887,811 Worcester 1,228,989 1,780,581 -31.0 3onn.-Ilartford. 7,123,321 6,997,077 +1.8 New Haven... 2.873,726 4,190,348 -31.4 1.0.-Providence 8,542,900 8,006,100 +6.7 4.11.-Manches'r 496,475 389,506 +27.5 Total(12 cities) 204,809,940 205,766,787 -0.5 1932. $ 1931. $ 452,898 2,833.387 276.174,588 864,305 288,850 925,945 3,815,402 2,881,526 8,891,356 7,019,651 11,881,900 599,753 662,304 3.534,679 391,334,275 1,104,984 841.642 1.082.486 5,091,544 3.048,679 12,155,206 8,491,001 14,556,500 618,811 316,429,361 442,320,091 Second Feder at Reserve D ',strict-New 3, 3. Y.-Albany.. 8,764,280 15,713,204 Binghamton_ 671,542 801,587 Buffalo 23,854,325 36,583,081 Elmira 475,272 570.084 Jamestown._._ 443,470 451,995 New York.... 2,635,154,991 2,871,182,321 Rochester 5,156,358 5,941,405 Syracuse 3,085.117 3,195,928 Conn.-Stamford 2,968.885 2,601,077 N. J.9Montclair_ .235,000 373.480 Newark 14,699,230 17,237,547 Northern N. J_ 24,317.812 24,900,138 York-6.005.626 7,176,344 -44.2 791,974 1,142,419 -18.2 31,931.299 -34.8 41,879,498 1.082.319 740,506 -16.6 858,990 1,126,407 -1.9 •-8.2 4,232,225,738 5,511,096,884 -13.2 8.510.771 9.977,489 5.006.079 -3.5 5,406.301 3,344.811 +14.1 3,600,924 525,500 -37.1 729,725 25,582,276 -14.7 32,112.736 34,086,958 -2.3 40,067,476 Total(12 cities) 2,719,826,083 2,979,551,807 -8.74,349.300.5265.655,298,602 Third Federal Reserve Dist rict-Philad elphiaPa.-Altoona_ . 267,405 289,911 -7.8 554.799 Bethlehem_ _ c c c c Chester 207,752 223,279 -7.0 517,000 Lancaster 615,888 861,463 -28.5 1,309,802 Philadelphia_ 234,000,000 296,000,000 -20.9 332,000,000 Reading 1,045,539 1,919,908 -45.5 2,584,087 Scranton 1,673,664 2,037,930 -17.9 3,563,996 Wilkes-Barre.. 1,236,820 2,363,933 1,627,889 -24.0 York 805,113 896,098 -10.2 1,496,864 N. J.-Trenton 2,521,000 4,579,000 -44.9 6,482,000 Total(9 cities)_ 242,373,181 Fourth Feder al 01110-Akron.... Canton Cincinnati _ Cleveland Columbus Mansfiled Youngstown Pa.-Pittsburgh. 1,315,113 c 1,000,000 1,521,050 394.000,000 3,214,098 4,541,511 3,832,184 2,029,110 4,593,000 Reserve D 'strict.- Cle veland c c c c c c 35,524,958 39,310,010 -9.6 60,549,017 57,083.186 -11.4 7,473,900 6,931,300 +7.8 832,311 840,389 -1.0 c c c 74,802,003 87,941,968 +10.1 349.872,481 418,048,066 c c 49,060,921 89,954,394 12,946.100 800,000 c 96,689,838 c c 67,236,000 115,021,000 14,988.800 1,611,207 c 150,485,500 249,431,053 349,320,507 Fifth Federal Reserve Dist rict.-Rich mond.-W. Va.-11unt'n_ 98,718 406,792 -75.7 442,330 Va.-Norfolk__ _ _ 1,779,000 2,811,674 2,138,000 -16.8 Richmond 24,581,750 29,187,943 27,127,194 -9.5 S. C.-Charleston 966,449 849,614 +13.8 933,740 Md.-Baltimore. 44,248,375 48,811,507 -9.4 66,513.831 D. C.-Wash'g'n 13,278,060 22,802,978 18,251,404 -27.2 952,078 4,212,691 37,203,000 2,046,031 84,117.280 25,433,426 Total(5 cities). Total(8 cities). 169,182,189 84,930,352 172,086.813 -1.7 97,584,511 -13.0 122,692,498 153,984,506 Sixth Federal Reserve Dis trict.-Atlan ta.Tenn.-Knoxville 2,018,885 2,152,079 -6.3 Nashville 10,333996 9,582,959 +7.8 Ga.-Atlanta 35,300,000 24,900,000 +41.8 Augusta 1,031,638 706,498 +48.0 Macon 606,092 334,894 +81.0 Fla.-Jacksonville 11,746,000 8,588,491 +36.8 Aja.-Birm'ham_ 14,430,653 10,856,589 +32.9 Mobile 1,039,150 731,624 +42.0 Miss.-Jackson cc c Vicksburg 137,906 109,910 +25.5 La.-NewOrleans 20,733,631 24,974,077 -17.0 3,455,324 11,215,128 33,400,000 1,188,963 543,969 11,251,359 13,262,864 1,120,513 c 160,139 35,955,942 2,500,000 18,074,420 40,530,343 1,494,001 840,041 13,865,083 16,014,293 1,545,400 c 207,925 46,033,258 Total(10 cities) 97,375,931 82,937,119 +17.4 111,552,201 141,104,742 Inc. or Dec. 1932. Total(19 cities 1 278,058,516 1931. 8 222,475 738,000 139,170,338 6,755,248 3,407,814 2,732.804 20,131,000 2,142,698 5,014,094 26,670,190 2,940.283 7.289,290 4,372,596 c 1,640,464 483,313,295 1,079,242 3,983,431 2,575,016 2,579,059 +0.1 423,501,851 716,737,137 Eighth Feder I I Reserve Die tact-St.Lo uisInd.-Evansville b b b Mo.-St. Louis... 56,700.000 54.500,000 +4.0 21,269,320 Ky.-Louisville • 19.226,867 +10.6 Tenn.- Memph 13,417,588 10,481,978 +28.0 111.-Jacksonvill b b b Quincy 345,943 -18.2 290,000 b 73,100,000 23,292,059 12,474,371 b 636,322 b 111,800,000 29,759,024 13,654,008 b 575,372 109.502,752 155.788.404 Ninth FederaI Reserve Dis trict -Minn eapoUsMinn.-Duluth_. 1,750,099 2,298,584 1,782,799 -0.7 Minneapolis... 42,017,202 42,157,125 -0.3 52,499,007 . St. Paul 17,108,893 13,902,182 +23.1 17.751,309 N. Dak.-Fargo. 1,490,824 1,883,348 1,428.613 +4.4 S.D.-Aberdeen. 477,871 -4.6 456,030 616,275 Mont.-Billings. 329,481 294,092 +12.0 487.074 Helena 1,757,142 2,008,414 2,001,899 -12.2 4,146,871 67.712,470 21,510,234 2,081,724 997.371 680.296 3.023,997 Total(4 cities). 91,676,906 277,839,151 84,554,788 +8.4 77,524,011 100.152,963 Tenth Feder I Reserve Dis trict- Kans as CityNeb.-Fremont-. 61,488 124,488 -50.6 173,418 C c c c Hastings Lincoln 1,895,755 2,450,335 1,668,729 +13.7 _ Omaha 25,454,888 28,304,604 17.580,547 +44.8 Kan.-Topeka _ _ 1,731,440 2,206,703 1,858,780 +4.4 1,791,588 Wichita....._ 5,055,558 3,524,843 -49.2 57.690.254 Mo.-Kan. City _ 53,973,415 +6.7 72,485,766 St. Joseph_ _ _ _ 2,616,609 3,782,233 2,426,034 +7.9 Colo.-Col. Spg 1. 449,085 862,343 469,784 -4.2 Pueblo _ 516,567 -3.7 497,200 961.183 253,044 c 3,379,214 40,400,622 3,408,232 7,643,671 111,962.655 6,395.262 967.002 1,487,837 Total (9 cities)_ 64,909,671 62,024,581 +4.7 81,941,167 +12.4 114,262,141 175,895,539 Eleventh Fed e cal Reserve District-Da hasTex.-Austin... 697.436 751,889 -7.2 Dallas _ 31,238,919 24,931,577 +25.3 Fort Worth _ 5,289,893 4,279,069 +23.2 Galveston_ 1,885,000 _ 1,906,000 -1.1 La.-Shreveport. 2,101,603 2,192,995 -4.2 1,091,794 31,588,648 6,107,110 2,838,000 3,243.606 1,464,213 38,527,572 8,074,989 3,010.000 4,613,369 44,869,158 '55.690.143 92,089,167 - Total(5 cities)_ 41,192,651 34,061,530 +20.9 Twelfth Fed r al Reserve D (strict-San Franci sco-Wash.-Seattle._ 19,590,114 27.986,992 17,472,679 +12.1 Spokane 5,633,000 7,432,000 4,278,000 +31.7 Yakima 445,259 564,031 270,930 +64.3 Ore -Portland._ 17,779,374 20,424,557 14,757.694 +20.5 Utah-S. L. City 9,522,656 11,990,143 -20.6 13.125,085 Calif.-L'g Bea 11 2,815,358 4,090,283 3.070,368 -8.3 Los Angeles...._ No longer will report clearin gs Pasadena_ _ _ _ 2,835,808 4,874.604 3,154,714 -10.1 Sacramento _ _ _ 3,596,772 9.974,071 6,981,34 -48.5 San Diego_ _ _ _ No longer will report clearin gs . San Francisco _ 95,848,900 88,795,203 +7.9 121,270,554 San Jose 1,594,842 2.197,815 1,585,823 +0.8 Santa Barbara _ 1,100,501 1,432,138 +5.1 1,046.738 Santa Monica. 928,124 1,256,770 921,073 +0.5 Stockton_ _ _ _ _ 1,194,032 1,631,633 1,303,309 -8.4 36,978,754 10,604,000 1,016,078 29,429,947 16,683,591 7,398,453 8.480,672 6,959,225 159,413,654 3,264,126 2,335,619 2,072,130 1,987,400 Total(13 eiti i) 162,882,740 155,828,019 Grand total(1 1 cities) 4,249,307,327 4,542,411,749 -6.5 6,485,289,262 8,646,942,249 Outside XewYo k 1,614,152,336 1,671,229,428 -3.4 2,253,063.526 3,135,845,365 +4.7 216,261,231 284.623,649 Week Ended Jan. 11. Clearings at1034. 308,435,476 -21.4 1933. $ $ $ % Seventh Feder at Reserve D istrIct-Ghl cagoMich.-Adrian -57.788 181,762 104,739 -44.8 Ann Arbor- --405,514 764,726 832,232 -51.3 Detroit 82,738,116 57,440,038 68,645,002 -2.1 Grand Rapids _ 4,791.345 1,492,758 3,538,588 -57.8 Lansing 561,613 1,826,400 324,000 +73.3 Ind.-Ft. Wayn 1,274,995 463,177 791,853 -41.5 Indianapolis 14,642,000 14.374,000 12,345,000 +18.6 South Bend_ _ _ 684.720 1,029,240 -33.5 1,405.790 Terre Haute... 4,358.338 3,925,948 3,332,988 +30.8 Wis.-Milwaukee 11,253,896 19,449,355 10,829,190 +3.9 la.-Ced. Rapids 283,537 776,630 514,457 -44.9 Des Moines_ _ 4,560,502 5,149,498 5,098,684 -10.6 Sioux City- 2,097,818 3.330,471 1,778,513 +18.1 C Waterloo c c c 268.731 1,165,984 '759,384 -64.8 • 175,508,792 173,924,153 +0.9 275,503,898 Chicago Decatur 412,006 812,583 383,076 +7.8 • Peoria 2,348,408 2.986,020 2,009,999 +16.8 Rockford .514,688 -5.3 487,62 1,084,420 733.463 Springfield_ _ _ • 1,959,910 1,085,611 -32.4 Total(7 cities). We now add our detailed statement, showing last week's figures for each city separately for the four years: 459 CanadaMontreal Toronto Winnipeg Vancouver Ottawa Quebec Halifax Hamilton Calgary St. John Victoria London Edmonton Regina Brandon Lethbridge Saskatoon Moose Jaw Brantford Fort William New Westminster Medicine Hat_ Peterborough_ Sherbrooke Kitchener Windsor Prince Albert---Moncton Kingston Chatham Sarnia Sudbury $ 87,820.076 96,628,504 32,935,995 13,036,193 3,984,176 3,571,026 2.023,621 3,415,959 4,238,068 1,427,419 1,482,619 2,112,518 3.487,587 1,518,932 268,682 375,922 1,057,743 409,804 732,230 512,527 407,422 214,674 53.5,938 538,583 797,293 1,694,642 234,383 752,783 547,692 384,814 362,292 500,855 Total(32 cities) 267,986,930 1933. Inc. or Dec. 1932. 1931. +,., 39.1 +35.1 -22.0 +18.4 +16.1 +14.9 -8.0 +11.2 -9.1 -2.7 +22.9 +1.3 +16.4 -82.1 +14.9 +17.0 +0.5 +1.8 +13.2 +13.2 +10.1 +30.1 +9.2 +18.0 +16.6 -2.6 +18.1 +25.2 -7.1 -0.7 -7.7 +28.6 5 75.664,140 72.388,799 30,114,120 12,177.020 4,542,208 4.067,068 2,461,762 4.030,994 4,381,529 2,222,407 1,419,188 2,353,862 4,313,517 4.030,729 293,405 289,820 3,256,782 473,917 794,938 440,936 458,151 174,741 536,496 618,492 812,840 2,362,924 296,177 751.277 514.811 451,951 379,535 563.178 $ 109,884,033 93.905,370 29,090,660 14.187,671 5,303,674 5.122,937 2,635,746 4,453,300 6,435,068 2,040,443 1,943.807 3.015,930 4,139,533 3,227,458 423,298 385,190 1,599.043 755,225 917,029 601.608 665,055 197,932 759,402 602,779 899,080 2,869.618 333.151 695,598 698,320 851,741 539,450 755,502 225,840,370 +18.7 237.635,692 299.534.651 $ 63,132,143 71,502,902 42,250,622 11,199,253 3,431,773 3,109,141 2,153.716 3.070,914 4,680,001 1,467,079 1.190,464 2,084,978 3,004.097 4,012,081 232,188 321,190 1,052,323 402.740 646,726 452,873 369,929 165,065 490,687 456,325 883,725 1,739,110 198,517 601.222 589,356 387,340 392,536 389,356 b No clearings available. c Clearing House not functioning at present. •Estimated. THE ENGLISH GOLD AND SILVER MARKETS. We reprint the following from the weekly circular of Samuel Montagu & Co. of London, written under date of Jan. 3 1934: GOLD. The Bank of England gold reserve against notes amounted to £190.725,833 on the 27th ult., as compared with £190.723,573 on the previous Wednesday. Although offerings of gold in the open market continued to be on a substantial scale, the amounts available were readily disposed of to the usual quarters. Quotations during the week: In New York In London Per Fine Equivalent Value Per Fine. Ounce. of £ Sterling. Ounce. $34.06 13s. 5.50d. 126s. 3d. Dec. 28 34.06 5.60d. 13s. 126s. 2d. Dec. 29 13s. 5.18d. ---126s. 6d. Dec. 30 Jan. 1 34:66 13s. 4.54d. 127s. Jan. 2 34.06 13s. 3.91d. 127s. 6d. Jan. 334.06 13s. 4.95d. 126s. 8.20d. Average gold on of Commencing on Saturday, Jan. 6, the time of fixing the price Saturdays will be 10.30 a. m., instead of 10.45 a. m. as hitherto. The following were the United Kingdom imports and exports of gold registered from mid-day on the 23d ult. to mid-day on the 1st inst.: Exports. Imports. £14,661 £774,681 Netherlands Netherlands 149,848 10,294 France Belgium 20,340 593,639 British India France 18,400 Switzerland 8,626 Iraq 350.144 United States of America_ 85,222 British West Africa 1,341,878 British South Africa 232.863 British India 60,859 Hongkong 59.390 Australia 341.085 Canada 9,859 British Guiana 16,440 Other countries £184,849 £3,903,380 The SS. Ranch' which sailed from Bombay on Dec. 30 carried gold to the value of E464,000, of which £405.000 is consigned to London and £59,000 to Amsterdam. The Southern Rhodesian gold output for November 1933 amounted to 55.387 fine ounces as compared with about 55.196 fine ounces for October 1933 and 48,082 fine ounces for November 1932. SILVER. Following the developments in the United States of America to which we referred last week, the tone of the market has been firmer, due to a large extent to small offerings, sellers in the circumstances being disposed to hesitate. There has been some profit taking at the higher rates but sales by the Continent have been small so that prices responded readily to demand from China. America and speculators. However, after yesterday's rise to 19 5-16d. for cash and 19%d.for two months delivery. America was inclined to sell and offered fairly freely in the afternoon. Although prices may show some sharp fluctuations, the undertone of the market seems fairly good. The following were the United Kingdom imports and exports of silver registered from mid-day on the 23d ult. to mid-day on the 1st inst.: Exports. Imports. £1,348 £22,723 Germany Germany 1.040 29.135 Norway Netherlands 4,620 8.482 France France 1,000 15,916 Syria Japan 3.250 13.480 Persia British India 1.843 2.100 British India Australia 1,748 1,210 Other countries Belgium £14,849 .C93,046 Quotations during the week: YORK. NEW IN IN LONDON. Bar Silver Per Oz. Std. (Per Ounce .999 Fine.) 2 Mos. Cash Delivery. Delivery. 44 3-16c. Dec. 27 18 15-16d. 19d. Dec. 28 44%c. 19 3-16d. Dec. 28 19 1-16d. Dec. 29 44%c. 19 3-180. Dec. 29 19 1-16d. Dec. 30 44%c. Dec. 30 Jan. 1 Jan. 1 19%cl. 195-16d. 2 Jan 45e. 195-16d. Jan. 2 195-16d. Jan. 3 19.213d. 19.138d. Average The highest rate of exchange on New York recorded during the period from the 28th ult. to the 3d inst. was $5.18,Si and the lowest $5.07. INDIAN CURRENCY RETURNS. Dec. 15. Dec. 22. (/n Lacs of Rupees)17,879 17.788 Notes in circulation 10,246 10,159 Silver coin and bullion in India 3.039 3,038 Gold coin and bullion in India 4,594 4,591 Securities (Indian Government) Dec. 7. 17,912 10,276 3,039 4.597 The stocks in Shanghai on the 30th ult. consisted of about 158,700.000 ounces in sycee, 345,000.000 dollars and 11,540 silver bars as compared with about 155.800.000 ounces in sycee,320,000,000 dollars and 11,220 silver bars on the 23d ult. Statistics for the month of December last are appended: Bar Gold Per Fine Ounce. 1278 Od. 1245. 8d. 1265. 2.62d. Bar Silver 2 Mos. Cash Delivery. Delivery. 19 3-16d. 19 1-16d. 18 7-16d. 18 7-16d. 18.7318d. 18.67480. Highest price Lowest price Average ENGLISH FINANCIAL MARKET-PER CABLE. The daily closing quotations for securities, &c., at London, as reported by cable, have been as follows tho past week: Mon., Tues.. Sat., Jan. 13. Jan. 15. Jan. 16. 19 7-16d. 19 11-16d. 1955d. Silver, per or. Gold, p.fine oz. 1279.11d. 1289.6d. 1319.9d. 75% 75% Consols, 2)4%. 76 British 355%101% 101% 10155 W. L British 4%112% 112% 1960-90 1125i French Rentes 65.40 65.50 (in Paris)3% Cr. 65.70 French War L'n (In Paris) 5% 104.70 105.00 1920 amort _ 104.50 Wed.. Jan. 17. 1955d. 1315.3d. 75% Frt., Thurs.. Jan. 18. Jan. 19. 19 9-16d. 19%'d. 132s.1Cd. 132s.10d. 75% 75% 10194 101% 101% 111% 112 112 65.20 65.10 65.00 104.50 104.80 104.80 The price of silver in New York on the same days has been: Sliver in N. Y., per oz. (cis.) Jan. 20 1934 Financial Chronicle 460 44% 45 44% 44% 44% 44% PRICES ON PARIS BOURSE. Quotations of representative stocks on the Paris Bourse as received by cable each day of the past week have been as follows: Jan. 13 1934. Francs. Bank of France 11,100 Banque de Paris et Pays Bas._ 1,480 Banque d'Union Parlsienne 255 Canadian Pacific 266 Canal de Suez 19,700 Cie Distr d'Electricitle 2,520 Cie Generale d'Electrleitie 1,920 Cie Generale Transatlantlque 36 Citroen B 517 Comptoir Nationale d'Escompte 1,010 Coty Inc 180 Courrleres 303 Credit Commercial de France 735 Credit Fonder de France 4,610 Credit Lyonnais 2,080 Distribution d'Electricitle la Par 2,510 Eaux Lyonnais 2,670 690 Energie Electrique du Nord._ 912 Energie ElectrIque du Littoral 38 French Line 87 Galeries Lafayette 1,020 Gas is Bon 620 Kuhlmann 740 L'Air Liquide 890 I,yon (P L M) 300 Mines de Courrieres 400 Mines des Lens 1,260 Nord Ry 841 Orleans Ry 840 Paris, France 58 PatheCapRal 1,110 Pechiney 65.30 Rentes 3% 104.05 Reines 5% 1920 74.60 Rentes 4% 1917 82.80 Ratites 484% 1932 A 1,830 Royal Dutch 1,370 Saint Gobain 0 & C 1,547 Schneider & Cie 510 Societe Andre Citroen 61 Societe Francalse Ford 106 Societe Generale Fonciere 2,655 Societe Lyonnalse 527 Societe Marseillalse 19,800 Suez 168 pref Silk Tubize Artificial 800 Union d'Electricitie 160 Union des Mines 98 Wagon-Lits Jan. 15 1934. Francs. 11,200 1,490 251 267 19,610 2,520 1,940 37 517 1,010 180 303 737 4,610 2,070 2,510 2,670 695 911 37 87 1,010 620 740 891 300 400 1,250 841 840 59 1,110 65.50 104.70 75.00 83.20 1,820 1,369 1,547 510 62 106 2,655 527 19,700 169 790 160 100 Jan. 16 1934. Francs. 11,400 1,500 245 264 19,500 2,520 1,960 39 515 1,010 180 303 740 4.630 2,080 2.520 2,670 700 910 39 87 1,020 620 740 886 300 400 1,260 841 840 57 1,110 65.40 105.00 74.90 81.30 1,820 1.380 1,559 510 63 106 2,665 527 19,600 168 800 160 99 Jan. 17 1934. Francs. 11,200 1,470 230 261 19,810 2,485 1,960 38 510 1,020 180 298 733 4,570 2,070 2,400 2,670 606 900 38 87 1,010 620 740 800 300 400 1,250 840 840 55 1,110 65.20 104.50 74.20 80.70 1.810 1,372 1,545 510 62 101 2,660 524 19,700 167 790 160 98 Jan. 18 1934. Francs. 11,100 1,460 232 260 19,770 2,465 1,930 38 505 1,020 180 298 725 4,570 2,060 2,460 2,650 689 896 38 86 1,010 610 730 889 300 400 1,240 840 840 55 1,090 65.10 104.80 74.10 80.50 1,780 1,371 1,540 510 62 106 2,650 523 19,800 163 780 160 97 Jan. 19 1934. Francs. 11,100 1,460 -263 -.1,040 1,621 180 475-113 2,060 2,460 2,650 _ 37 87 1,020 620 730 566 400 1,250 636 1:656 65.00 104.30 73.70 80.30 1,790 - -476 63 103 19-,i1545 780 160 THE BERLIN STOCK EXCHANGE. Closing prices of representative stocks as received by cable each day of the past week have been as follows: Jan. 13. 168 Relchsbank (12%) 88 Berliner Handels Gesellschaft (5%) 51 0 A Bank Conunerz-und Privet Deutsche Bank end Disconto-Gesellschaft„ 57 61 Dresdner Bank Dents( he Reichsbahn (Ger Rys) pref(7%)..110 Allgemeine Elektrizitaets-Gesell (A E G)__. 26 122 Berliner Kraft u Licht(10%) 114 Dessauer Gas (7%) 90 Gesfuerel(5%) 107 Hamburg Elektr Werke (8%) 146 Siemens & Halske(7%) 124 IC Farbenindustrie (7%) Salzdetturth (784%) 198 Rheinische Braunkohle (12%) 103 Deutsches Erdoel(4%)-60 Mannesmann Roehren 28 Hapag 29 Norddeutscher Lloyd Jan. 15. 168 88 51 57 61 110 26 122 114 88 108 147 124 151 198 102 60 28 30 Jan. Jan. Jan. 17. 16. 18. Per Cent of Par 166 167 166 88 88 88 48 49 50 54 55 56 60 60 61 111 111 111 26 26 26 120 120 111 111 111 87 87 88 107 108 107 142 141 143 125 125 125 146 150 198 199 200 99 58 58 60 28 28 28 29 29 29 Jan. 19. 166 87 48 54 60 111 27 119 110 87 107 142 123 198 59 27 28 In the following we also give New York quotations for German and other foreign unlisted dollar bonds as of Jan. 19 1934: Malan, 75 to 1946 Argentine 5%, 1945, $100 pieces Antioquia 8%. 1946 Austrian DefaultedCoupons Bank of Colombia, 7%.'47 Bank of Colombia. 7%.'48 Bavaria 6%s to 1945 Bavarian Palatinate Cons Cit. 7% to 1945 Bogota (Colombia)655.'47 Bolivia 6%, 1940 Buenos Aires scrip Brandenburg Elec.(is. 1953 Brazil funding 5%. '31-51 British Hungarian Bank 7558. 1962 Brown Coal Ind. Corp 855s, 1953 Cali (Colombia) 7%, 1947 Callao (Peru) 755%, 1944 Ceara (Brazil) 8%, 1047.. Columbia scrip Costa Rica funding 5%.'51 Costa Rica scrip City Savings Bank, Budapest, 75. 1953 Dortmund NI un Util M.'48 Duisberg 7% to 1945 Duesseldorf 7s to 1945.... East Prussian Pr. Os. 1953 European Mortgage & Investment 7558, 1966-French Govt. 5558. 1937.. French Nat. Mall SS. 6s.'52 Frankfurt 79 to 1945 German Atl Cable 75, 1945 German Building & Land bank 655%, 1948 German defaulted couPo128. Haiti 6% 1953 Hamb-Am Line 684, to '40 Hanover Harz Water Wks. 6%, 1957 Housing & Real Imp 7s,'46 Hungarian Cent Mut 7E9.'37 Hungarian Discount & Exchange Bank 7s. 1063_ . Fia1 price. Bid 138 80 122 J95 /1512 /1512 f5012 Ask 41 -2-i i112 2112 5212 38 21 /36 /19 8 /15 15012 42 25 5212 43 /54 56 165 /15 4 /3 110 /40 /40 --__ /43 /43 /36 /37 15012 46 45 39 40 5212 16 5 7 20 f5012 5212 145 142 139 40 137 53 151 /52 /74 65 /74 53 138 /40 /40 41 /34 BidAsk Hungarian defaulted coups Hungarian Ital ilk 755s,'32 /75 Jugoslavia bs. 1956 25 30 Koholyt 63'ss. 1943 150 Land M Bk, Warsaw 8s,'41 163 CtiLeipzig Oland Pr. 6559,'46 155 61 Leipzig Trade Fair 7s. 1953 /41 43 Luneberg Power. Light & Water 7%, 1948 /6214 6514 Mannheim & Paint 75. 1941 5512 ceh 7s 48 /46 Munic palNIIlln tin 5E1 n 5 138 '11) % eseto ,7 40 Gas & Recklinghausen, 7s. 1947 /4112 4412 Nassau Landbank 0558,'38 /51 54 Natl. Bank Panama 612% 1946-9 4112 /40 Nat Central Savings Ilk of Ilungary 7558, 1062._ /55 National Hungarian & Ind Mtge. 7%,1948 151 53 Oberpfalz Elec.7%, 1946_ 142 44 Oldenburg-Free State 7% to 1945 /38 41 Porto Alegre 7%. 1068.... /2112 2312 Protestant Church (Ger many), 7s. 1946 44 /42 Prov Ilk Westphalia 68.'33 /56 60 Prov Bk Westphalia es,'36 /56 58 Rhine Westph Elec 7%,'36 /6412 1110 do Janeiro 6%, 1933.. /21 12 Rom Cath Church 6348,'46 161 64 R C Church Welfare 7s,'46 ./42 44 iaarbruecken M Ilk 6s,'47 175 Salvador 7%, 1957 /18,2 -1V1-2 Santa Catharine (Brazil). 8%, 1947_1 22 121 Santander(Colom) 7e, 194f. .11017 Illt Sao Paulo (Brazil) 619. 1943 /21 23 Saxon State Mtge. 6s, 1947 /61 63 Halske deb tls, 2930 /270 285 Stettin Pub Utll 7e, 1946.. /48 50 Tucuman City 7s, 1951._ /21. 23 Tucuman Pray 7s, 1950.. /38 44 Vesten Elec Ry 7s, I947.., /32 37 Wurternberg 78 to 1045,-- /4612 4812 grimmerdaland MiscellaneousROM Breadstuffs Figures Brought from Page 526.-All the statements below, regarding the movement of gramreceipts, exports, visible supply, &c., are prepared by us from figures collected by the New York Produce Exchange. First we give the receipts at Western lake and river ports for the week ending last Saturday and since Aug. 1 for each of the last three years: Receipts atChicago Minneapolis. Duluth Milwaukee_ _ _ Toledo Detroit Indianapolis_ St. Louls___ _ Peoria Kansas City.Omah St. Joseph. Wichita Sioux CRY- Flour. I Wheat. I Oats. Corn. I Rye. I Barlett. bbis.196Ibs bush.60 lbs.lbush. 56 lbs.'bush. 32 lbs.bush.56lbs.lbush.481bs. 291.000 4,000 286,000 494,0001 152,000 48,000 725,000 70,000 138.000 307.000 397,000 1.000 37,000, 38.000 2,000 382.000 36,000 74,000 15,000 8,000 18.000 85,000 39,000 18,000 7,000 28,000 34,000 27,000 122,000 268,000 68,000 2.000 158,000, 334,000 243,000 117,000 25,000 9,000 60,000 548,000 38,000 16,000 30.000 267,000 15,000 305,000 17,000 405,000 177,000 31,000 157.000 30,000 4,000 38,000 122,000 1.000 11,000 23,000 Total wk.1934 Same wk.1933 Same wk.1932 337,000 376,000 343,000 1,620,000 3,188,000 3,760,000 2,980,000; 3,587.000, 2,518,000 93,000 1.444.000 145,000 580,000 433,000 77,000 928,000 912,000 947,000 Since Aug.11933 8,035.000 139,328,000 112,032,0001 43,879,000 7,555.000 29,682,000 1932 9,162,000213,099,000 104,541,000 52,214,000 6,470.000 24.599,000 1931 10,780,000200,078,000 64,842,000 39,893.000 4,056.0 21.006.000 Total receipts of flour and grain at the seaboard ports for the week ending Saturday, Jan. 13 1394, follow: Receipts at- I New York... Philadelphia.. Baltimore.__ Newport News New Orleans * Galveston Bt. John West Boston Halifax Flour. Wheat, Oats. Corn. Barley. Rye. I bls.1981bs bush.60 lbs.bush.56 lbs.bush. 32 I5e.lbush.561bs.bush.48lbs. 121,000 293,000 13,000 2,000 5,000 29,000 8,''' 85,000 3,000 011 9,000 3,000 2,000 19,000 40,000 30,000 21,000 51,000 24.000 9,000 29,000 76,000 oil 18,000 2,000 2,000 43,000 160,000 5,000 Total wk.1934 Since Jan.1'34 279,000 514,000 Week 1933... Since Jan.1'33 * Receipts do on through bills 93,000 5,000 286,000 414,000 79,000 486.000 1.279.000 167.000 24.000 2.000 119.000 not include grain passing through New Orleans for foreign ports of lading. 689,000 1,841,000 75,000 158,000 2,000 24,000 7.000 15,000 54,000 111,000 The exports from the several seaboard ports for the week ending Saturday, Jan. 13 1934, are shown in the annexed statement: Exports fromNew York Philadelphia Newport News New Orleans Galveston Halifax St. John west Wheat. Corn, Flour. Rye. Oats. Barley. Bushels. Bushels. Barrels. Bushels. Bushels. Bushels. 11,987 1,046,000 104,000 40,000 5,000 2,000 6,000 20,000 2,000 5,000 160,000 43,000 76,000 29,000 Total week 1934- 1,446,000 Same week 1933.- 2.110,000 2,000 48,000 10,000 5,000 91,987 73,886 The destination of these exports for the week and since July 1 1933 is as below: Flour. Exports for Week and Since Since Week July 1 toJan. 13 July 1 1934. 1933. Wheat. Week Jan. 13 1934. Since July 1 1933. Corn. Week Jan. 13 1934. Since July 1 1933. Barrels, Barrels. Bushels. Bushels. Bushels. Bushels. United Kingdom_ 61,956 1,634,971 256,000 212,000 28,698,000 Continent 13,000 440,529 1,226,000 38,674,000 9,031 351,000 1.000 So.& Cent. Amer_ 2,000 6,000 32,000 West Indles 31,000 2.000 31,000 13,000 475,000 Brit. No.Am.Col. 6,000 1,000 29,000 2,000 597,000 8,000 Other countries-------144,269 Total 1934 Total 1933 91,987 2,755,769 1.446.000 68,351,000 73,886 2.145,713 2,110,000 108,527.000 2,000 310.000 48.000 3.639.000 The visible supply of grain, comprising the stocks in granary at principal points of accumulation at lake and seaboard ports Saturday, Jan. 13, were as follows: United StatesBoston New York " afloat Philadelphia Baltimore Newport News New Orleans -Galveston Fort Worth Wichita Hutchinson 81. Joseph Kansas City Omaha Sioux City St. Louis Indianapolis Peoria Chicago " afloat Milwaukee " afloat Minneapolis Duluth Detroit Buffalo " afloat 461 Financial Chronicle Volume 138 GRAIN STOCKS. Oats, Wheat. Corn, bush. bush. bush. 5,000 30,000 182,000 226,000 100,000 466,000 134,000 86,000 416,000 1,223,000 15,000 41,000 442,000 25,000 99.000 42,000 314,000 735,000 564,000 4,316,000 281,000 18,000 2,055.000 57,000 3,874.000 710,000 3,857.000 3,158,000 703,000 82,391,000 4,476,000 6,935,000 8,094,000 2,756.000 489,000 619,000 636,000 487,000 4,316,000 2,073,000 831,000 728,000 1,575,000 279,000 380,000 16.000 4,132,000 19,090,000 3,928,000 1,126,000 16,000 3,191,000 3,208,000 178,000 204,000 25,083,000 4,340,000 16.790,000 11,854,000 4,882,000 11,089.000 36.000 230,000 35,000 4,775,000 8,450,000 1.301,000 272,000 10,751,000 1,401,000 Rye, bush. 1,000 1,000 19,000 20,000 65,000 Barley, bush 14,000 20,000 6,000 2,000 38.000 8,000 58,000 94,000 166.000 6,000 195,000 33,000 87,000 75,000 5.000 30,000 8,000 3,335.000 1,103,000 1,564,000 33,000 798.000 3,201,000 8,496,000 2,701,000 1,767,000 18,000 72,000 1,654.000 701,000 196,000 877,000 Total-Jan. 13 1934..119,114,000 64,480,000 44,023,000 13.315,000 14,152,000 Total-Jan. 6 1934-122,357.000 65,945,000 44,496,000 13,526,000 14,361,000 Total-Jan. 14 1933...158,838,000 29,662,000 24,202,000 7,833,000 8.503,000 Note.-Bonded grain not included above: Wheat, New York, 3,921,000 bushels: New York afloat, 1,522.000; Philadelphia, 322.000; Boston, 986,000; Buffalo. 855.000; Buffalo afloat, 3,219,000; Duluth, 41.000; Erie. 661.000; Newport News, 253,000: total, 11,780,000 bushels, against 11,626,000 bushels in 1933. Barley, Wheat. Rye, Corn, Oats, Canadianbush, bush. bush. bush. bush. Montreal 384,000 458,000 4,674,000 524.000 Ft. William & Pt. Arthur 63,614,000 4,781,000 2,131.000 4,633,000 Oth. Can.& oth. wat. pts 41.778,001) 564.000 1,312,000 4,967,000 Total-Jan. 13 1934.. _110,066,000 Total-Jan. 6 1934_A11.283.000 Total-Jan. 14 1933._ 98,386,000 SummaryAmerican 119,114,000 64,480,000 Canadian 110,066,000 10,272,000 3,153.000 6.329,000 10,525,000 3,157,000 6,292,000 4,496,000 3,376.000 2,710.000 44,023,000 13,315,000 14,152,000 10,272,000 3,153,000 6,329,000 Total-Jan. 13 1934-229,180,000 64.480,000 54,295,000 16,468,000 20,481.000 Total-Jan. 6 1934_233,640,000 65,945,000 55,021,000 16,683,000 20,653.000 Total-Jan. 14 1933 _257,224,000 29.662,000 28,698,000 11,209,000 11,213,000 The world's shipment of wheat and corn, as furnished by Broomhall to the New York Produce Exchange,for the week ending Friday, Jan. 12, and since July 1, 1933 and July 2 1932, are shown in the following: Wheat. Exports- Week Jan. 12 1934. Since July 1 1933. Corn. Since July 2 1932. Week Jan. 12 1934. Since July 1 1933. Sines July 2. 1932. Bushels. Bushels. I Bushels. I Bushels. I Bushels. Bushels. North Amer_ 4,723,000 5.000 404.000 4,268,000 , . , . i Black ___ 696,000 30,811,000 18,272,000 281,000 19,219,000 36.101.000 Argentina... 2,406,000 56,598,000 27,462,000/ 5.583.000124.023,000133,092,000 Australia _ -_ 1,981,000 46,861,000 56,125,000, I 744.000 17,728,000, 18,629,000, 306.000 5,971,000 20,219.000 0th. countes Total 10,550,000275,134,000310,532,000' 6.175,000 149,617,000193,680,000 CURRENT NOTICES. -Estabrook & Co. have issued a pamphlet in which they discuss the foundations for business recovery in 1934. -First of Michigan Corp. has issued its monthly quotation list on municipal and corporate bonds. -Frederick B. Davis & Co. announce the removal of their offices to 29 Broadway, New York. -Outwater & Wells, of Jersey City, have issued a list of New Jersey investment suggestions. -Hammons & Co., Inc. have prepared an illustrated study of Consolidated Aircraft Corp. -Hardy 5: Co. of this city announce that Henry Schwed is now associated with them. -J.S. Bache & Co. have issued their current "Commodity Review." National Banks.-The following information regarding National banks is from the office of the Comptroller of the Currency, Treasury Department: CHARTERS ISSUED. Capital. Jan. 6-The First National Bank in Ontonagon, Ontonagon, $50,000 Mich Capital stock consists of $25,000 common stock and $25,000 preferred stock. President, Claude D. Riley; Cashier, Laurence E. Chabot. Will succeed No. 6820, The First National Bank of Ontonagon. 200.000 Jan. 6-American National Bank of Shawnee, Shawnee, Okla Capital stock consists of $100,000 commmon stock and $100.000 preferred stock. President, C. E. Bowlby; Cashier, A. J. Guyton. Will succeed No. 6416, The State National Bank of Shawnee. Jan. 8-The Miners' First National Bank of Ishpeming, Ish100,000 peming, Mich President, S. M. Cohodas; Cashier, C. H. Moss. Will succeed No. 5668, The Miners' National Bank of Ishpeming. Jan. 8-First National Bank in Pepperell. Pepperell (P.O. East Pepperell), Mass 50,000 President, Edwin D. Walker; Cashier, Henry L. Hart. Will succeed No. 5964, The First National Bank of Pepperell. Jan. 9-The National Bank of Edgerton, Edgerton, Wig 50.000 Capital stock consists of $25,000 common stock and $25,000 preferred stock. President, J. W. Menhall; Cashier, H. M. Petersen. Will succeed No. 7040, The First National Bank of Edgerton. Jan, 9-First-Lockhart National Bank, Lockhart, Tex 100,000 President, John T. Storey; Cashier, Arthur A. Wilde. Will succeed No. 4030, The First National Bank of Lockhart, and No. 5491. The Lockhart National Bank. Jan. 9-The West National Bank, West, Tex 50,000 President, Paul S. Skrabanek; Cashier, F. E. Seith. Will succeed The West State Bank. Jan. 10-The City National Bank & Trust Co. of Kansas City, Kansas City, Mo 300,000 President, R. C. Kemper; Cashier, G. C. Kopp. Conversion of The City Bank & Trust Co. Jan. 11-The First National Bank of Dickson City, Dickson City, Pa 100.000 President, J. J. O'Connor; Cashier, F. M. O'Connor. Will succeed No.9851,The Dickson City National Bank, VOLUNTARY LIQUIDATIONS. Jan. 5-The First National Bank of Marlinton, Marlinton, W.Va $50,000 Effective Dec. 30 1933. Liq. Committee: J. A. McLaughlin, J. A. Sydenstricker and A.0. Baxter, care liquidating bank. of the Succeeded by "First National Bank in Marlinton," W. Va., charter No. 13783. ,_I Jan, 9-The Sorento National Bank, Sorentoll 25,000 Effective Jan. 4 1934. Liq. Agent. H. H. Holbrook, care of the liquidating bank. No absorbing or suceeediug bank. Jan. 10-National Ulster County Bank & Trust Co. of Kingston. N.Y 200.000 Effective Dec. 15 1933. Liq. Agent, LeRoy Frederick Port, 300 Wall St.. Kingston, N. Y. Succeeded by The National Ulster County Bank of Kingston, charter No. 13822, Jan. 10-The First National Bank of Hubbell, Hubbell, Mich 50,000 Effective Jan.6 1934. Liq. Agents: A. L. Burgan and Richard E. Odgers, both of Hubbell, Mich. Succeeded by The First National Bank at Hubbell, Mich., charter No. 13824. 462 Financial Chronicle Jan. 20 1934 Jan. 10—The First National Bank of El Segundo, El Segundo, 25,000 Calif When Per Books Closed Effective Jan.8 1934. Liq. Agent, H. B. Raney, care Share. Payable. Days Inclusive. None of Company of the liquidating bank. of Los AnNational Bank Absorbed by Security-First Public Utilities—(Coudaded). geles, Calif., No. 2491. Binghamton Gas Wks..634% pt (qu.) _ - El% Feb. 1 Holders of rec. Jan. 20 551% Feb. 1 Holders of rec. Jan. 16 Central Ohio Lt.& Pow..$6 pref Jan. 12—The Cecil National Bank of Port Deposit, Port De50.000 Central Power & Light Co.—Took no pr et. di v. action posit, Md City Water of Chattanooga,6% pf (gra.) $1% Feb. 1 Holders of ree. Jan. 20 Effective Jan. 8 1934. Liq. Agents: George J. Liddell $1.125 Feb. 15 Holders of rec. Jan. 31 Connecticut Ry. Sr Light (quar.) and C. T. Kimble, care of the liquidating bank. $1.125 Feb. 15 Holders of rec. Jan. 31 434% preferred (quar.) Succeeded by The Cecil National Bank at Port Deposit. Cumberland Pow.& Lt., 6% met (qu.) $1% Feb. 1 Holders of rec. Jan. 15 Md., charter No. 13840. Dallas Pow.& Light, 7% pref.(quar.).. $1% Feb. 1 Holders of rec. Jan. 20 BRANCHES AUTHORIZED. $138 Feb. 1 Holders of rec. Jan. 20 66 preferred (quar.) $1% Feb. 1 Holders of rec. Jan. 20 Jan. 8—The First National Bank & Trust Co. of Bridgeport, Conn. Davenport Water,6% pref. (quar.)-Location of branch: No.859 East Main St., Bridgeport, Conn., Derby Gas & Elec. Corp., $634 pf. (qu.) $1% Feb. 1 Holders of rec. Jan. 20 certificate No. 958A. $7 preferred (quar.) $1% Feb. 1 Holders of ree. Jan. 20 12%c Jan. 15 Holders of reo. Jan. 1 Jan. 10—The First National Bank of Portland, Portland, Ore. Location Eastern States Gas (quar.) Empire & Bay $1 Mar. 1 Holders ol. rec. Feb. 29 Side Tel., 4% County, Ore. Hoppner, Morrow guar. (911.) of branch: No. 1 Main St., 4% guaranteed (quar.) $1 June 1 Holders of rec. May 22 certificate No. 959A. 4% Sept. 1 Holders of rec. Aug. 22 $1 guaranteed (quar.) Jan. 11—Northern National Bank of Presque Isle, Presque Isle, Me. 4% guaranteed (quar.) $1 Dec. 1 Holders of rec. Nov. 21 Location of branch: 94 Main St., Van Buren, Aroostook Escanawba Feb. 1 Holders of rec. Jan. 27 $1% Pow. & Traction, pref. .(:Mar.) County, Me., certificate No. 960A. 6% preferred (quar.) $1% May 1 Holders of rec. Apr. 26 6% preferred (quar.) il% Aug. 1 Holders of rec. July 27 6% preferred (quar.) $1% Nov. 1 Holders of rec. Oct. 26 Auction Sales.—Among other securities, the following, Hartford 68 Ho Feb. 1 Holders of rec. Jan. 15 Electric Light Co not actually dealt in at the Stock Exchange, were sold at auction Idaho $1% Feb. 1 Holders oi rec. Jan. 15 Power Co., 7% pref. (guar.) $1% Feb. 1 Holders ot rec. Jan. 16 in New York, Boston, Philadelphia and Buffalo on Wednes- $6 preferred (guar.) Kentucky Utilities Co.,pr. pref.(qu.) _ - 87Sic! Feb. 20 Holders of rec. Feb. 1 day of this week: Kokomo Water Works 6% pref.(quar.) El% Feb. 1 Holders of rec. Jan. 20 50c Feb. 1 Lorain Telep.,6% pref.(monthly) By Adrian H. Muller & Son, New York: El% Feb. 1 Holders of reo. Jan. 17 Louisiana Pow.& Lt. Co.$6 pref.(qu.) 250 Jan. 15 Holders of rec. Jan. 10 Per Sh. Maine Gas Co.(quar.) Shares. Stocks. $1% Jan. 15 Holders of rec. Jan. 10 $50 lot 166 2-3 Eureka Royalty Co.(Okla.) common, par $100 Preferred ( (Mar.) 600 Feb. 1 Holders of rec. Jan. 15 $50 lot Mississippi Pow.& Light,$6 pref 350 U.S. Royalties Corp.(Del.) preferred, par $100 $25 lot Monmouth Consol. Water 7% Pf.(qu.)- $1% Feb. 15 Holders of rec. Feb. 1 1,050 U.S. Royalties Corp.(Del.) class A common,no par 20c Mar. 1 Holders of rec. Feb. 10 National Pow.dt Light, corn 31 United Thacker Coal Co. (Me.) Par $100; 30 Ohio & Big Sandy Coal Co., 37%e Feb. 15 Holders of rec. Jan. 31 (Va.), par $100; 765-100 Federal Gas, 011 & Coal Co.(Me.). par $100.......$14 lot Pacific Gas & El.6% 1st pret. (quar.) 34%c Feb. 15 Holders of rec. Jan. 31 $2 lot 10 American Woman's Realty Corp., preferred 53.4% first preferred (quar.) 587e Feb. 1 Holders ol rec. Jan. 18 35 Portland Gas& Elec.,7% pref 40 Chemical Bank & Trust Co h75o Feb. 1 Holders of rec. Jan. 18 6% preferred Per Cent. Bonds. 700 Mar.31 Holders of rec. Mar. 1 Public Service Corp.of N.J. corn.(qu.). Rights of holders of certificates of deposit for $16,600 face value Foster Merriam 31 Holders of rec. Mar. 1 $2 Mar. preferred (guar.) 8% cumulative Aug. dated 15 plan, & Co., 734% 1st mtge. bonds under reorganization 1930: $1% Mar.31 Holders of reo. Mar. 1 7% cumulative preferred (quar.) Rights of holders of certificates of deposit for $51.600 face value The Meriden $1% Mar.31 Holders of rec. Mar. 1 $5 cumulative preferred (guar.) Foster Merriam Co. refunding 7% bonds under reorganization plan, dated 50c Feb. 28 Holders of rec. Feb. 1 8% preferred (monthly) $5 lot Aug. 15 1930 50e Mar.31 Holders of reo. Mar. 1 8% preferred (monthly) Thirty bonds & mtgs. for the sum of $148,200 & int.. upon which bonds & 25o Feb. 25 Holders of reo. Jan. 27 Quebec Power Co. corn. (quar.) of Int., 29 separate parcels mtges. there is unpaid the sum of $142,400 & 130 Feb. 15 Holders of reo. Jan. 23 Shawinigan Water & Power corn. (1111.) property at Long Beach, Nassau County, N. V., and one of which mfges. $1% Feb. 1 Holders of rec. Jan. 22 _$5,000 lot Sierra Pacific Elec. Co.6% pref.(qu.) covers one parcel of property at Huntington, Suffolk County, N. Sioux City Gas & Elec.,7% pre! (qu.)— $1% Feb. 10 Holders of rec. Jan. 31 Bond of B.L.B. Realty Corp., dated April 13 1927 for the suns of $80,000, Y__- upon t.4111 Tennessee Electric Power Co. which $55,000 is due, with int. from Oct. 13 1928. Mtge. of B.L.B. Realty $1% Apr. 2 Holders of reo. Mar. 15 5% 1st preferred (quar.) Corp. securing the bond, covering premises at Island Park, Nassau County. 51% Apr. 2 1olders of rec. Mar. 15 6% 1st preferred (guar.) Bond of individual to Island Park-Long Beach, Inc., for $5,950, dated Apr. 2 folders of reo. Mar. 15 7% 1st preferred (guar., March 25 1928. The full amount is due with int. from March 25 1926. Apr. 2 folders of rec. Mar. 15 $1.80 7.2% 1st (quar.) preferred Mtge. between same parties securing the bond covering property at Island 500 Feb. 1 folders of rec. Jan. 15 6% 1st preferred (monthly) Park. Bond of individual to Island Park-Long Beach, Inc.. dated March 25 500 Mar. 1 folders or reo. Feb. 15 6% 1st preferred (monthly) 1926 for $4,480. The full amount is due with int. from March 25 1927. 50c Apr. 2 folders of rec. mar. 15 6% 1st preferred (monthly) • Mtge. between same parties securing the bond covering property at Island 6043 Feb. 1 Holders of roe. Jan. 15 7.2% 1st preferred (monthly) $5,000 lot Park Mar. 1 Holders of reo. Feb. 16 80o 7.2% 1st preferred (monthly) appurtenances, taken The ELS."Santa Isabel." her engines, boilers, tackle and 600 Apr. 2 Holders of rec. Mar. 15 7.2% 1st preferred (monthly) Possession of by virtue of the default in a mortgage, dated Dec. 17 1923..$25,000 lot $2.% Apr. 29 Holders of rec. Mar.20 United Cos.of New Jersey (guar.) The S.S."Santa Entails," her engines, boilers, tackle and appurtenances, taken possession of by virtue of the default in a mortgage, dated Dec.17 1923-$35,000)ot United Light 4; Rys. Co.(Del.)58 1-30 Feb. 1 Holders of rec. Jan. 16 7% preferred (monthly) The S.S. "Santa Veronica," her engines, boilers, tackle and appurtenances. 530 Feb. 1 Holders of ree. Jan. 15 6.36% preferred (monthly) taken possession of by virtue of the default in a mortgage, dated Dec. 17 500 Feb. 1 Holders of reo. Jan. 15 6% preferred (monthly) $40,000 lot 1923 58 1-3c Mae. 1 Holders of reo. Feb. 15 7% preferred (monthly) 53c Mar. 1 Holders of roe. Feb. 15 6.36% preferred (monthly) By R. L. Day & Co., Boston: 50o Mar. 1 Holders of rec. Feb. 16 6% preferred (monthly) per Sh. Shares. Stocks. 1-30 Apr. 2 Holders of rec. Mar.15 58 7% preferred (monthly) 80 50 Hamilton Woolen Co Apr. 2 Holders of reo. Mra. 15 530 6.36% preferred (monthly) 5134 30 Wm.Whitman & Co., preferred, par $100 50e Apr. 2 Holders of rec. Mar. 15 6% preferred (monthly) 834 Nashawena Mills, par $100 88 5 Naumkeag Steam Cotton Co., par $100 4834 Bank and Trust Companies. 95 50 Lynn Gas & Electric Co., par $25 $20 Feb. 1 Holders of rec. Jan. 25 11134 Kings County Trust Co.(guar.) 20 First National Stores, preferred, par $100 5% 20 Graton 4; Knight Mfg. Co., common Fire Insurance Companies. 234 30 Saco Lowell Shops, common $IM Jan. 15 Holders of rec. Dec. 30 3634 Lumbermen's Ins. Co.(quar.)___ 10 Graton & Knight Mfg. Co., preferred, par $100 $1 Jan. 2 Holders of reo. Dec. 26 Niagara Fire Ins. Co., N. Y.(quar.)... 22 10 New England Public Service Cos. $7 prior preferred 150 Mar.10 Holders of reo. Mar. 1 North River Ins.Co.(quar.) 10e Mar.10 Holders of rec. Mar. 1 Extra By Barnes & Lofland, Philadelphia: 300 Feb. 1 Holders of rec. Jan. 22 U.S.Fire Ins.Co.(guar.) Per Sh. Shares. Stocks. 200 Feb. 1 Holders of ree. Jan. 22 Extra 25 50 Central-Penn National Bank, par $10 43 lot 10 First Nat. Bank, Marlton, N. J.. par $50 Miscellaneous. 62 lot 36 First National Bank, Marlton, N. J.. par $50 25 20c Mar. 1 Holders of rec. Feb. 15 30 Penna. Co.for Insur. on Lives & Granting Annuities, par $10 Agnew Surpass Shoe stores. oon• $1% tor. 2 Holders of rec. Mar. 15 50 Southampton State Bank Preferred ((lust.) 40 Feb. 1 Holders of rec. Jan. 22 $1% 50 James Lees & Sons Co., preferred Allied Kid Co., 4634 Pref.(guar.) Bonds Aluminum Co. of Amer., pref.(qua?.).. 37%o Apr. 1 Holders of rec. Mar. 15 $1,000 Garden Court Apartments.6% 1st mtge., March dc Sept., due 1932_11 $1 Jan. 20 Holders of reo. Jan. 18 American Book(quar.) Feb. 1 Holders of rec. Jan. 20 American Crayon, 6% pref. (quar.)By A. J. Wright & Co., Buffalo: American Envelope,7% pref.(quar.)_ _ $1% Mar. 1 Holders of rec. Feb. 25 June 1 Holders of rec. May 25 $1% per Sh. $ Shares. Stocks. 7% preferred (quar.) $134 Sept. 1 Holders of rec. Aug. 25 500 10 The Como Mines 7% preferred (quar.) $IR Dec. 1 Holders of rec. Nov.25 7% preferred (guar.) 100 Feb. 10 Holders of rec. Jan. 31 American Factors(mo.) DIVIDENDS. 10o Mar.10 Holders of rec. Feb. 28 Monthly Mar. 1 Holders of reo. Feb. 15 7550 cum Corp., A & Gen. Securities Dividends are grouped in two separate tables. In the Amer. 75c Mar. 1 Holders of rec. Feb. 15 $3 series cumulative Preferred 25e Jan, 25 Holders of reo. Jan. 15 first we bring together all the dividends announced the American Lace Mfg 500 Feb. 15 Holders of rec. Jan. 31 Re-Insurance Co.(quar.)._ current week. Then we follow with a second table in American 50e Apr. 2 Holders of rec. Mar. 16 American Stores Co. (guar.) 50e Apr. 2 Holders of reo. Mar. 5 which we show the dividends previously announced, but American Sugar Refining Co.,cons.(qu.) $1% Apr. 2 Holders of ree mar. 5 Preferred (quar.) paid. been not yet have which 750 Feb. 1 Holders of reo. Jan. 26 Austin Nichols, A are: $1% this week Mar. 1 Holders of rec. Feb. 13 announced dividends The Bamberger (L.) & Co..634% prof. (qtr.) 5o Jan. 20 Holders of reo. Jan. 10 Bandlni Petroleum (monthly) Feb. 250 Holders of rec. Feb. 1 15 (quar.) common Blauner's, Inc., Books Closed When Per 75e Feb. 15 Holders of rec. Feb. 1 Preferred (quar.) Days Inclusive. Share. Payable. Name of Company 500 Jan. 24 Holders of ree. Jan. 17 Boston Herald Traveler 68%0 Feb. 15 Holders of rec. Feb. 1 BourJois,Inc.,4234 pref.(qua?.) Railroads (Steam). Buckeye Steel Cstgs.,634% pref.(qu.).- $1% Feb. 1 Holders of reo. Jan. 22 56 Jan. 31 Holders of rec. Jan. 20 Cincinnati Northern (s-a) $1% Feb. 1 Holders of rec. Jan. 22 6% preferred (quar.) $1.10 Mar. 10 Holders of rec. Feb. 26 Buckeye Columbus & Xenia 5.04e Feb. 1 Holders of rec. Jan. 16 Trust Shares,Be?. A 5134 Feb. 1 Holders of rec. Jan. 26 Erie & Kalamazoo 60 Feb. 15 Holders of rec. Feb. 1 Buffalo Gold mines (8-a) Ankerite Kansas City St. Louis & Chicago120 Feb. 1 Holders of rec. Jan. 15 Bullock Fund $134 Feb. 1 Holders of rec. Jan. 19 6% guar. preferred (quar.) 50e Feb. 15 Holders of reo. Jan. 31 (quar.) Canadian converters of rec. Holders Feb. 1 84 Feb. 15 Louisville Henderson & St. Louts (6.-a.) 12%0 Feb. 15 Holders of rec. Feb. 1 Canadian 011(quar.) El% Feb. 15 Holders of rec. Jan. 31 Louisville & Nashville, corn $2 Apr. 1 Holders 01 rec. Mar.20 Preferred (quar.) 3234 Jan. 15 Holders of rec. Jan. 11 Ogden Mines (s.-a.) 12%o Feb. 28 Holders 01 ree. F0. 3. 15 (special) Caterpillar Tractor Co. Holders of rec. Feb. 6 s234 Feb. 20 Holders'of Oswego & Syracuse (5-a) Feb. 15 Holders of roe. Feb. 5 12%e Central Cold Storage rec. Jan. 25 3134 Feb. 1 Passaic& Delaware (8-a) 250 Feb. 1 Holders of reo. Jan. 16 (initial). Chain Investors (Del.), Store Jan. 19 rec. Holders of $334 Feb. 10 Peoria & Burt= Valley (s.-a.) 250 Feb. 1 Holders of rec. Jan. 24 Charis Corp. (guar.) 75e Apr. 10 Holders of rec. Mar. 31 Piedmont AG Northern (quar.) Cherry-Burrell Corp., ore. (Quar.)---- $1% Feb. 1 Holders of reo. Jan. 20 750 Jan. 20 Holders of rec. Jan. 10 Quarterly 551% Feb. 1 Holders of rec. Jan. 20 Preferred $134 Jan. 20 Holders of rec. Jan. 10 OgExtra 250 Mar. 1 Holders ot rec. Feb. 19 ChicagoYellow Cab (quar.) $234 Feb. 1 Holders of rec. Jan. 13 Portland (Maine) (s.-a.) 5(83 Feb. 15 Holders of rec. Jan. 30 (special) Chickasha Cotton 011 Co. of rec. Feb. 1 Holders Feb. 15 50e Rutland & Whitehall Aka Claude Neon Elec,Products Corp.(Del.) $3 Jan. 15 Holders of rec. Dec. 31 Saratoga & Schenectady (5.-a.) 25o Jan. 19 Holders of ree. Jan. 12 Common (guar.) $134 Feb. 1 Holders of rec. Jan. 15 Shamokin Valley & Pottsville (s.-a.)Jan. 19 Holders of reo. Jan. 12 350 (quar.) 7% preferred Syracuse,Binghamton & N.Y.(quar.) _ $3 Feb. 1 Holders co. rec. Jan. 25 Commercial National Corp 300 Feb. 1 Holders of rec. Jan. 28 Consolidated Amusement(quar.) Ismr.s Public Utilities. 300 May 1 Holders ot reo. Apr. 20 Quarterly Consumers Power Co., $5 prof. (quar.). 8134 Apr. 2 Holders of rec. Mar. 15 Indus., A (qu.)- - 37%0 Feb. 1 Holders of rec. Jan. 15 Chemical Consolidated rec. Holders of Mar. 15 2 Apr. (quar.) $134 6% preferred 250 Mar. 1 Holders of rec. Feb. 20 (quar.) Corno Mills Co. $1.65 Apr. 2 Holders of rec. Mar. 15 6.6% preferred (quar.) 30o Feb. 1 Holders of reo. Jan. 20 Cuneo Press, Inc., corn. (quar.) $134 Apr. 2 Holders of rec. Mar. 15 7% preferred (quar.) Mar. 15 Holders of rec. Mar. 1 $1% Preferred of rec. Jan. 15 (guar.) Holders 1 Feb. 50e 6% preferred (monthly) 250 Feb. 15 Holders of rec. Feb. 1 Darby Petroluem Corp 50o Mar. 1 Holders of rec. Feb. 15 6% preferred (monthly) 250 Mar. 1 Holders of roe. Feb. 15 Diamond Match (guar.) 15 Mar. of rec. Holders Apr. 2 500 preferred (monthly) 6% 750 Mar. 1 Holders of rec. Feb. 15 6% preferred (5.-a.) 550 Feb. 1 Holders of rec. Jan. 15 6.6% preferred (monthly) 1.50 Feb. 1 Holders of rec. Jan. 15 Dividend Share; 550 Mar. 1 Holders of rec. Feb. 15 6.6% preferred (monthly) 800 Feb. 15 Holders of reo. Feb. 5 (guar.) Plantation Ewa Mar. 15 reo. Holders of Apr. 2 (monthly) 550 6.8% preferred Name of Company. When Per Share. Payable. Books Closed Days Inclusive. Miscellaneous (Coatfueled). Ely Sz Walker Dry Goods Co.— Common (special) Jan. 15 Holders of rec. Jan. 4 51 Special 250 Mar. 1 Holders of rec. Feb. 17 Emerson's Bromo Seitz.com.A & B(qu.) 50c Feb. 1 Holders of rec. Jan. 22 Preferred (guar.) 500 Feb. 1 Holders ot rec. Jan. 22 Faber Coe & Gregg, 7% pref.(quar.) $134 Feb. 1 Holders of rec. Jan. 20 Federal Service Finance (Wash., D. C.) 500 Jan. 31 Holders of rec. Dec. 31 (Quarterly) 7% preferred (guar.) 2134 Jan. 31 Holders of rec. Dec. 31 Fenton Un. Clean. & Dye Co. 7% 1st preferred (guar.) $144 Jan. 15 Holders of rec. Jan. 10 Fidelity Fund, Inc. (guar.) 50e Feb. 1 Holders ot rec. Jan. 20 Extra 250 Feb. 1 Holders of rec. Jan. 20 Finance Shares Corp 2c Jan. 15 Holders of rec. Dec. 31 Fulton Industrial& Securities(guar.)_ _ _ 8734c Feb. 1 Holders of rec. Jan. 15 General Foods Corp. (guar.) 45e Feb. 15 Holders of rec. Feb. 1 General Outdoor Advertising Co.—Took no pref . div. a ction Great Lakes Dredge & Dock Co.(qu.)- _ 25c Feb. 15 Holders of rec. Feb. 6 Great Lake Engineering Wks.(quar-)- - 5c Feb. 1 Holders of rec. Jan. 25 Great Western Electro-Chemical Co $1 Feb. 15 Holders of rec. Feb. 5 Hale Bros. Stores, Inc. (guar.) 15c Mar. 1 Holders of rec. Feb. 15 Quarterly 150 June 1 Holders of rec. May 15 Quarterly 150 Sept. 1 Holders of rec. Aug. 15 Quarterly 15c Dec. 1 Holders of rec. Nov. 15 Hartford Times, 23 prof. (guar.) 750 Feb. 15 Holders of rec. Feb. 1 Hibbard, Spencer, Bartlett & Co.(mo.) 10e Jan. 26 Holders of rec. Jan. 19 Monthly 10e Feb. 23 Holders of rec. Jan. 16 Monthly 100 Mar.30 Holders of rec. Jan. 23 Hickok Oil (s.-a.) 500 Mar.15 Hollander (A.) dr Son, Inc., corn. (qu.)_ 12340 Feb. 15 Holders of rec. Jan. 31 Horne (Jos.) Co., pref.(guar.) $134 Feb. 1 Holders of rec. Jan. 24 International Harvester. prof.(guar.) _ 3134 Mar. 1 Holders of rec. Feb. 5 Interstate Hosiery Mills (guar., 500 Feb. 15 Holders of rec. Feb. 1 Quarterly 50c May 15 Holders of rec. May 1 Quarterly 50e Aug. 15 Holders of rec. Aug. 1 Quarterly 500 Nov. 15 Holders of rec. Nov. 1 Kansas City Stkyds.of Me..5% pt.(an.) $134 Feb. 1 Holders of rec. Jan. 15 Quarterly $144 Feb. 1 Holders of rec. Jan. 15 Kayser(Julius)& Co 25c Feb. 15 Holders of rec. Feb. 1 Koloa Sugar(mo.) 50o Jan. 31 Holders ot rem Jan. 24 Monthly 50e Feb. 28 Holders of rec. Feb. 21 Monthly 500 Mar.31 Holders of rec. Mar.24 Lansing Co. (guar.) 250 Feb. 10 Holders of rec. Jan. 31 Lanston Monotype Co. (guar.) 21 Feb. 28 Holders of rec. Feb. 16 Lehigh & Wilkes-Barre Corp.(guar.).— $2 Jan. 22 Holders of rem Jan. 13 Loew's Boston Theatres(guar.) 150 Feb. 1 Holders of rec. Jan. 20 Luther Mfg $1 Feb. 1 Holders of rec. Jan. 16 McIntyre Porcupine Mines (guar.) 250 Mar. 1 Holders of rec. Feb. 1 Bonus 1244e Mar. 1 Holders of rec. Feb. 1 Extra 1234e Mar. 1 Holders of rec. Feb. 1 Mercantile Amer. Realty,6% Pf (qu.)_ - $134 Jan. 15 Holders of rec. Jan. 15 Metropolitan Indus. Co. (quer.) 21e Feb. 1 Holders of rec. Jan. 20 Metropolitan Storage Warehouse (qu.)750 Feb. 1 Holders of rec. Jan. 11 Michigan-Davis Co.(special) $4 Jan. 24 Holders of rem Jan. 17 Minneapolis-Honeywell Regulator— Common (guar.) 250 Feb. 15 Holders of rec. Feb. 3 Extra 25c Feb. 15 Holders of rec. Feb. 3 Montgomery Ward dr Co., class A 85534 Feb. 12 Holders of rec. Jan. 27 Moody's Investors Service. prof. (guar.) 750 Feb. 15 Holders of rec. Feb. 1 Muskogee Co.,6% prof. (guar-) $134 Mar. 1 Holders of rec. Feb. 16 Nation-Wide Securities, Ser.B 3c Feb. 1 Holders of rec. Jan. 15 Neon Prod. of W.Canada,6% pt.(qu.)750 Feb. 1 Holders of rec. Jan. 15 New Amsterdam Casualty,corn 40c Feb. 1 Holders of rec. Jan. 24 New England Grain Prod.(guar.) 25c Feb. 1 Holders of rec. Jan. 20 Nineteen Hundred Corp., class A (guar.) 500 Feb. 15 Holders of rec. Feb. 1 North American 011 150 Feb. 1 Holders of rec. Jan. 20 Oceanic Oil (guar.) 2c Jan. 17 Holders of rec. Jan. 7 Oswego Falls, let pref.(guar.) $2 Feb. 1 Holders of rec. Jan. 27 Owens-Illinois Glass, corn.(guar.) 75.3 Feb. 15 Holders of rec. Jan. 30 Pan-American Southern Corp $3 Jan. 30 Holders of rec. Jan. 22 Peoples Drug Stores,con).(special) 50c Feb. 1 Holders of rec. Jan. 25 Philadelphia Bourse, 6% pref $1 Feb. 1 Holders of rec. Jan. 15 Puritan Ice, 8% pret. $4 Apr. 1 Holders of rec. Dec. 31 Rayon Industries Corp. (guar.) 234% Feb. 1 Holders of rec. Jan. 22 Reliance Mfg. Co. of Illinois, corn.(qu.) 15c Feb. 1 Holders of rec. Jan. 22 Special 500 Feb. 1 Holders of rem Jan. 22 Republic Supply Co. (guar.) 250 Apr. 5 Holders ot rec. Apr. 2 Quarterly 250 July 5 Holders of rem July 2 Quarterly 25e Oct. 5 Holders of roe. Oct 2 Rich Ice Cream (guar.) 25c Feb. 1 Holders of rec. Jan. 15 Sc Feb. 16 Holders of rec. Jan. 23 Royalties management Samson Corp., 5% preferred 50e Jan. 31 Holders of rem Dec. 31 Savannah Sugar Refining Co.,coin.(am) 2134 Feb. 1 Holders of rec. Jan. 15 Preferred (guar.) $134 Feb. 1 Holders of rec. Jan. 15 Second Standard Royalties, 12% pret _ 10 Feb. 1 Holders of rem Jan. 22 Securities Corp. General,$6 pref.(quax.) $134 Feb. 1 Holders of rem Jan. 11 27 preferred (guar.) $1 94 Feb. 1 Holders of rec. Jan. 19 Selby Shoe Co., common (guar.) 400 Feb. 1 Preferred (guar.) 5134 Feb. 1 Squibb (E. R.) & Sons (guar.) 25e Feb. 1 Holders of rec. Jan. 15 $6 1st preferred (guar.) 5134 Feb. 1 Holders of rec. Jan. 15 Standard Cap & Seal Co., corn. (guar.) 60c Feb. 15 Holders of rec. Feb. 1 Standard Oil Co. of Kansas (guar.).— 50o Apr. 30 Holders of rec. Apr. 2 Thatcher Mfg. Co.,cony. pret.(guar.)_ 90c Feb. 15 Holders of rec. Jan. 31 U.S.Banking Corp.(mo.) 7c Feb. 1 Holders of rec. Jan. 17 U.S.Foreign Secs.,$6. 1st prof.(QM) 2134 Feb. 1 Holders ot rec. Jan. 22 U. S. Petroleum Co. (guar.) 10 Mar. 10 Holders of rec. Mar. 5 Quarterly lc June 10 Holders of rec. June 5 Quarterly lo Sept. 10 Holders of rec. Sept. 5 Quarterly lo Dec. 10 Holders of rec. Dec. 5 U. S. Pipe dr Foundry Co., corn. (guar.) 12X e Apr. 20 Holders of rec. Mar. 31 Common (guar.) 12340 July 20 Holders of rec. June 30 Common (guar.) 12440 Oct. 20 Holders of rec. Sept.29 Common (guar.) 1234e 1-20-35 Holders of rec. Dee. 31 Preferred (guar.) 300 Apr. 20 Holders of rec. Mar.31 300 July 20 Holders of rec. June 30 Preferred (guar.) Preferred (guar.) 300 Oct. 20 Holders of rec. Sept. 29 300 1-20-35 Holders of rec. Dee. 31 Preferred (guar.) Walker & Co.,class A 50e Feb. 1 Holders of rec. Jan. 15 Walton (Chas. S.) & Co.,8% pref.(qu.) 22 Feb. 1 Holders of rec. Jan. 15 Waralua Agricultural(guar.) 600 Feb. 28 Holders of rec. Feb. 28 West Virginia Pulp & Paper Co.— Preferred (guar.) $134 Feb. 15 Holders of rec. Feb. 1 Winstead Hosiery (guar.) $134 Feb. 1 Holders of rec. Jan. 15 Quarterly 9134 May 1 Holders of rec. Apr. 15 Quarterly $1)4 Aug. 1 Holders of rec. July 15 Quarterly $134 Nov. 1 Holders of rec. Oct. 15 Below we give the dividends announced in previous weeks and not yet paid. This list does not include dividends announced this week, these being given in the preceding table. Name of Company When Per Share. Payable Books Mom, Days Mambo. Railroads (Steam). Alabama Great Southern, prof 3% Feb. 27 Holders of rec. Jan. 22 $134 Jan. 30 Holders of rec. Jan. 15 Albany dr Susquehanna (special) $3.30 Feb. 1 %folders of rem Dec. 29 AVM.Top.& Santa Fe,5% mit Atlanta & Charlotte Air Line (8.-a.) $444 Mar. 1 Holders of rec. Feb. 20 5154 Feb. 1 Holders of rec. Doe. 29 Canada Southern (s.-a.) Cleve. Ctn., Chic. dr St. Louis,5%(an.)- $134 Jan. 31 Holders of rec. Jan. 20 Semi-annual $5 Jan. 81 Holders of rec. Jan. 20 $3 Feb. 1 Holders of rec. Jan. 1 Conn. & Passumpslo River, prof. (8.-a.) Louis. & Missouri River, 7% gtd. prof. $33.4 Feb. 1 Holders of rec. Jan. 19 Mahoning Coal,con).(guar.) 5634 Feb. 1 Holders of rec. Jan. 19 $25 Jan. 81 Holders of rec. Jan. 20 Michigan Central $1 Feb. 19 Holders of rec. Jan. 31 Norfolk & Western, adj. pref. (quar.) Northern RR.of N.H.(guar.) 2134 Jan. 31 Holders of rec. Jan. 5 463 Financial Chronicle Volume 138 Name of Company. When Per Share. Payable. Railroads (Steam)(Candid-ea). Pittsburgh Cinn. Chicago & St. Louis- Pittsburgh & Lake Erie (s.-a.) Reading Co.. common (guar.) United New Jersey HR.& Canal(guar.)Virginian prof.(quer.) $234 $134 25c $2)4 $134 Books Closed Days Inclusive. Jan. 20 Holders of roe. Jan. 10 Feb. 1 Holders of roe. Dec. 29 Feb. 8 Holders of rec. Jan. 11 Apr. 10 Holders of rec. Mar.20 Feb. 1 Holders of rec. Jan. 20 Public Utilities. Alabama Power Co..25 pref.(guar.)_ _ $134 Feb. 1 Holders of rec. Jan. 15 Amer Cities Pow.& Lt., el. A conv.(qu.) 01-32 Feb. 1 Holders of ree. Jan. 11 5134 Feb. 1 Holders of rec. Jan. 10 Amer. Gas & Floe., pref.(guar.) 40e Feb. 1 Holders of rec. Jan. 13a Amer. Light & Tram Co.,corn.(guar.).134% Feb. 1 Holders of rec. Jan. 13o Preferred (guar.) Amer. Water Works & El. Co. of Del.— 250 Feb. 1 Holders of rec. Jan. 5 Common (guar.) 5134 Feb. 1 Holders of rec. Jan. 9 • Atlantic City Elec., pref.(quer.) Feb. 1 Holders of rec. Jan. 10 3734c _ corn. (quar.)_ Co., Bangor Hydro-Elec. British Columbia Telep.,6% 28 pt.(qu.) 2134 Feb. 1 Holders of roe. Jan. 15 Buffalo Niagara & Eastern Pow.Corp.— 5134 Feb. 1 Holders of rec. Jan. 15 $5 1st preferred (guar.) Calgary Power Co., Ltd.,6% prof.(qu.) $134 Feb.s.1 Holders of rec. Jan. 15 200 Jan. 25 Holders of rec. Dec. 30 corn. Canada Northern Pow., 10e Jan. 25 Holders of rec. Dec. 30 Extra Cent. Arizona Lt.& Pow. Co.$7 pf.(qu.) $134 Feb. 1 Holders of rec. Jan. 15 Feb. 1 Holders of rec. Jan. 15 $134 $6 preferred (guar.) 20e Feb. 1 Holders of rec. Dec. 30 Central Hudson Gas & Electric (quar.)_ 15e Feb. 1 Holders of rec. Jan. 20 Central Illinois Securities Corp. pref. - _ $ilt Jan. 25 Holders of ref). Dec. 30 Citizens Wat.(Pa.) 7% prof. (guar-)$1.34 Mar. 1 Holders of rec. Feb. 15 Cleve.Elec. Ilium.,6% prof.((Mari Feb. 15 Holders of rec. Jan. 20 (qu.) 51234 Corp., coal. Columbia Gas& Elec. $134 Feb. 15 Holders of rec. Jan. 20 6% preferred, series A (guar.) 2134 Feb. 15 Holders of rec. Jan. 20 5% preferred (guar.) Columbus Ry.,Pr.& Lt.. pref. B (an.). $1.62 Feb. 1 Holders of rec. Jan. 15 $1 Feb. 1 Holders of rec. Jan. 15 Commonwealth Edison Co $134 Feb. 15 Holders of rec. Jan. 31 Concord Gas, 7% preferred (guar.) 75e Mar.15 Holders of rec. Feb. 2 Consolidated Gas 2134 Feb. 1 Holders of rec. Dec. 29 Consolidated Gas of N.Y.,5% Pf. 500 Feb. 1 Holders of rec. Jan. 20 .(mo.)- — Dayton Pow & Lt.Co..6% pf. 180 Apr. 15 Holders of rec. Dec. 31 Eastern Township Telephone Feb. 1 Holders of rec. Jan. 10 $234 (au.). Boston Edison Elec. Ilium. Co.of $134 Feb. 1 Holders of rec. Jan. 8 Electric Bond & Share Co.,26 pf.(qu.) 5134 Feb. 1 Holders of rec. Jan. 8 55 preferred (guar.) 10c Feb. 1 Holders of rec. Jan. 15 Elec.Pow.Assoc., Inc).el. A & com.(gu.) Escanaba Pow. & Trac.6% pref.(qu.).. 134% Feb. 1 Holders of rec. Jan. 27 Hawaiian Electric (monthly) 15c Jan. 20 Holders of rec. Jan. 15 150 Jan. 20 Holders ot roe. Jan. 12 Honolulu Gas Co., Ltd. (mo.) Houston Lt. & Pow., 7% pref. (qua?.,. $154 Feb. 1 Holders of rec. Jan. 15 $134 Feb. 1 Holders of rec. Jan. 15 26 Preferred ((Mar.) Illinois Northern Utilities Co. 5134 Feb. 1 Holders of rec. Jan. 15 (guar.) preferred 6% $IX Feb. 1 Holders of rec. Jan. 15 7% prior cum. prof. (guar.) International Utilities Corp. 8754e Feb. 1 Holders of rec. Jan. 200 27 prior preferred (guar.) rec. Jan. 20a $334 prior pref.series 1931(guar.). _ _ 4344c Feb. 1 Holders of $134 Feb. 10 Holders of rem Jan. 31 pt. A (an.) Co., 6% Tel. Lincoln Tel. & of rec. Jan. 31 Holders Feb. 10 $144 5% Special preferred (guar.) 15 Lone Star Gas Corp..634% prof.(guar.) $1.63 Feb. 1 Holders of re*. Jan. Jan. 31 rec. Holders ot Feb. 15 5134 ((Iu.) pl. Corp., Los Angeles Gas & Elec. Jan. 10 Malone Lighting & Pow. Co., pref.(qu.) $134 Feb. 1 Holders of rec. Milwaukee Elec. Ry. dr Light Co. $134 Jan. 31 Holders ot rec. Jan. 20 6% preferred (guar.) $134 Feb. 1 Holders of rec. Jan. 12 Montana Power Co.. $13 pref.(guar.) Consol.— Montreal Light, Heat& Power r38c Jan. 31 Holders of rec. Doe. 30 Common (guar.) 10 National Pow.& Lt., $6 pref.(qua?.)..- $144 Feb. 1 Holders of rec. Jan. 51 Feb. 1 Holders of rec. Dec. 300 Nevada-California Electric Corp., pref. $134 Feb. 1 Holders of rec. Jan. 20 New Engl. Wat., Lt. & Pow. p1. 75e Feb. 1 Holders of rec. Jan. 20 Series A 150 Feb. 1 Holders of rec. Jan. 20 Series B 15o Feb. 1 Holders of rec. Jan. 20 Extra (quar.) $134 Mar. 1 Holders of rec. Feb. 15 North American Edison, prof. Northern N.Y. Utilities,7% in pi.(qr.) 5154 Feb. 1 Holders of rec. Jan. 10 50c. Jan. 25 Holders,of rec. Dec. 30 Northern Ontario Power Co.,corn. Car.). 5144 Jan. 25 Holders of rec. Doe. 30 Preferred (guar.) Northern States Pow. Co.(Del.) 134% Jan. 20 Holders of rec. Dec. SO 7% Preferred (guar.) 134% Jan. 20 Holders of rec. Dec. 30 6% preferred (guar.) 1-30. Feb. 1 Holders of rec. Jan. 15 58 pro!. (mo.) Ohio Public Serv.Co..7% 50c Feb. 1 Holders of rec. Jan. 15 6% preferred (monthly) 41 2-3c. Feb. 1 Holders of rec. Jan. 15 5% preferred (monthly) 75c Feb. 15 Holders of rec. Jan. 20 (guar.) Pacific Lighting Corp.common Peninsular Telep. Co.,7% prof.(quar.). 1,1% Feb. 15 Holders of rec. Feb. 5 Feb. 1 Holders of rec. Jan. 20 550 pret.(mo.) 56.60 Pennsylvania Power Co. 55c Mar. 1 Holders of rec. Feb. 20 $6.60 preferred (monthly) 5134 Mar. 1 Holders of roe. Feb. 20 $6 preferred (guar.) 17340 Jan. 25 Holders of rec. Doe. 30 Philadelphia Co., common (guar.) 450 Feb. 1 Holders of rec. Jan. 15 Philadelphia Elec. Co. (guar.) 5131 Feb. 1 Holders of rec. Jan. 15 $5 preferred (guar.) 2144 Feb. 1 Holders of ree. Jan. 20 Potomac Edison 7% prof.(guar.) $131 Feb. 1 Holders of rec. Jan. 20 6% preferred (guar.) Public Service Co. of Colorado58 1-3c Feb. 1 Holders of rec. Jan. 15 7% preferred (monthly) 500 Feb. 1 Holders of rec. Jan. 15 6% preferred (monthly) 41 2-Ic Feb. 1 Holders of rec. Jan. 15 5% preferred (monthly) 50c Jan. 3 Holders of rec. Jan. 2 Public Service of N. J., 6% prof.(mo). Pub. Serv. of Northern Illinois.— .stk. No div.action taken on corn. or pf. Holders of roe. Jan. 15 20e Feb. Rockland Light & Pow. Co.(quar.)- Holders of rev. Jan. 15 20e Feb. Common stock trust ctfs. (quar.) — Holders of rec. Jan. 15 41 Feb. Rhode Island Public Service A (qtlar.)-Holders of rec. Jan. 15 Feb. f 00 Preferred (guar.) South Pitts. Water 5% pref.(semi-ann.) 2144 Feb. 1 Holders of ree. Feb. 10 2% Feb. 15 Holders of rec. Jan. 20 Southern Calif. Edison Co.. Ltd., corn_ Southern Calif. Gas, $634 prof. (guar.). $194 Feb. 28 Holders of rec. Jan. 31 20e Feb. 15 Holders of rec. Jan. 31 Southern Canada Power Co., COM.(qu.) 45e Jan. 25 Holders of rec. Dee. 30 Standard Gas & Elec.$6 prof.(guar.).5234c Jan. 25 Holders of rec. Dec. 30 57 preference (guar.) Standard Pow.& Lt. Corp. pref.(guar.) 52Sic Feb. 1 Holders of rec. Jan. 15 Suburban Elec. See.6% let prof.(qu.).. 2134 Feb. 1 Holders of rec. Jan. 15 Texas Pow.& Light, 7% pref. (guar.).- $144 Feb. 1 Holders of rec. Jan. 13 $134 Feb. 1 Holders of roe. Jan. 13 56 preferred (quar.) Toledo Edison Co.7% pref. (monthly). 58 1-3c Feb. 1 Holders of rec. Jan. 15 500 Feb. 1 Holders of rec. Jan. 15 6% preferred (monthly) 41 2-3c Feb. 1 Holderm of rms. Jan. 15 5% preferred (monthly) 40e Feb. 1 Holders of ree. Jan. 24 Utilities Stock & Bond Corp. V. t. 0..... WestPenn Elec. Co., 7% pref. (guar.) $134 Feb. 15 Holders of rec. Jan. 19 $1% Feb. 15 Holders of rec. Jan. 19 6% preferred (qua?.) Holders of rec. Jan. 5 West Penn Power Co.,6% pref. (guar.) $134 Feb. $144 Feb. 1 holders of roe. Jan. 5 7% preferred (guar) Wisconsin Telep.7% pref.(quer.) $144 Jan. 31 Holders of rec. Jan. 20 Bank and Trust Companies. Corn Exchange Bank Trust(guar.) 75e Feb. 1 Holders of roe. Jan. 22 Fire Insurance Companies. Boston Insurance Co City of New York Ins. Co Franklin Fire Insurance Co.(guar.).— Horn Ins. Co.(guar.) National Liberty Ins. Co.of Amer South rn Fire Ins. Co Standard Fire Ins. ot N. J. (guar.).United Ins. Trust Shares, SOT. F reg._ Series F bearer $4.21 25 25e 250 100 50c 3744e 8c 8o Miscellaneous. Abraham & Straus. Inc.. prof. (qua?.).. Adams Mills Co.,corn.(guar.) Preferred (guar.) Affiliated Products, Inc. corn.(mo).... Alaska Juneau Gold Mingiug (quar.) Extra $154 2.5e $144 50 15c 15c. Apr. 2 Holders of re*. Mar.20 Feb. 1 Holders of rec Jan. 15 Feb. 1 Holders of rec. Jan. 20 Feb. 1 Holders of rec. Jan. 15 Feb. 10 Holders of rec. Feb. 1 Mar. 1 Hold rs of rec. Feb. 15 Jan. 23 Holders of rec. Jan. 11 Feb. 1 Holders of rec. Doe. 31 Feb. 1 Feb. Feb. Feb. Feb. Feb. Feb. Holders of rec. Jan. Holders of rec. Jan. Holders of rec. Jan. Holders of rec. Jan. Holders of rec. Jan. Holders of rec. Jan. 15 19 19 17 13 13 464 Financial Chronicle Name of Company. Per When Share. Payable. Books Closed. Days Inclusive. Miscellaneous (Continued). Allan's Beverages, 7% pref. (guar.).--- 31% Jan. 31 Holders of rec. Jan. 15 Allegheny Steel Co., pref.(guar.) 51% Mar. 1 Holders of rec. Feb. 15 Allied Chem.& Dye Corp., corn.(guar.) 314 Feb. 1 Holders of rec. Jan. 11 Amerada Corp.(quar.) 50c Jan. 31 Holders of rec. Jan. 15 American Can Co., corn. (guar.) $1 Feb. 15 Holders of rec. Jan. 25a American Coal Co. of Allegany Co 31 Feb. 2 Holders of rec. Jan. 13 50c Jan. 27 Holders of rec. Jan. 15 American & Continental 25c Feb. 1 Holders of rec. Jan. 19 Amer. Cyanan.id Co., el. A & B (spec.)._ 200. Feb. 1 Holders of rec. Jan. 15a American Home Products (mo.) American Ice Co., pref.(guar.) 314 Jan. 25 Holders of rec. Jan. 5 American Investors, Inc.. 53 pref.(guar.) 750 Feb. 15 holders of rec. Jan. 31 200 Feb. 1 Holders of rec. Jan. 20 Amer. Machine & Fdy. Co., corn.(qu.) 50e Feb. 1 Holders of rec. Jan. 15 American Reserve Ins. Co. of N. Y_ _ _ _ 50e Feb. I Holders of rec. Jan. 15 American Shipbuilding, corn.(guar.) - American Smelting & Refining, pref _ 71524 Mar. I Holders of rec. Feb. 2 lc Jan. 25 Holders of rec. Jan. 15 Amparo Mining Co 56% Jan. 30 Holders of rec. Dec. 30 Anglo Amer. Corp.of So. Africa 50c Jan. 30 Holders of rec. Jan. 15 Apponaug Co., corn.(quar.) Archer-Daniels-Midland Co., p1. (au.). El% Feb. 1 Holders of rec. Jan. 20 c Feb. 1 Holders of rec. Jan. 15 Asbestos Mfg. Co., corn Atlas Powder Co., pref. (qilar.) 51/5 Feb. 1 Holders ot rec. Jan. 19 Auto Finance. pref. (s-a) 874c Jan. 25 Holders of rec. Jan. 13 Belding Coniceill, Ltd.. corn. (quar.)--31 Feb. 1 Holders of rec. Jan. 15 Beneficial Ind. Loan Corp. corn.(qui- — 37/5e Jan. 30 Holders of rec. Jan. 15 Preferred, series A (guar.) 87%c Jan. 30 Holders of rec. Jan. 15 25e Feb. 15 Holders of rec. Jan. 25 Best & Co., corn. (quar.) Birtman Elec. Co., pref.(guar.) 51% Feb. 1 Holders of rec. Jan. 15 Bloomingdale Bros.,Inc., pref.(quar.).... El% Feb. 1 Holders of rec. Jan. 20 51 Jan. 31 Holders of tee. Jan. 16 Boo Am!Co., class A (quar.) 25% Jan. 30 Holders of rec. Dec. 30 Brakpan Mines, Ltd 25c Jan. 30 Holders of rec. Jan. 15 Briggs Mfg. Co British-American Tobacco Co., Ltd.— tad Jan. 24 Holders of rec. Dec. 22 Amer. dep. rec. ord. bearer (final).-wl0d Jan. 24 Holders of reo. Dec. 22 Interim w8d Jan. 24 Holders of rec. Dee. 22 Amer. dep. rec. ord. register (final)._ wl0d Jan. 24 Holders of rec. Dec. 22 Interim i%% Feb. 1 Holders of rec. Jan. 20 Brown Shoe Co., pref.(guar.) 50 Feb. 15 Buffalo Ankerite Gold Mines (s.-a.) -$20 Jan. 31 Holders of rec. Jan. 20 Cabot (Godfrey) 40c Apr. 1 Holders of rec. Mar. 15 Columba Sugar Estates, coin. (quar.)_.. 35c Apr. 1 Holders of rec. Mar. 15 7% preferred (guar.) 31% Feb. 1 Holders of rec. Jan. 15 Campe 64% pref.(guar.) rile Feb. 1 Holders of rec. Jan. 19 Canadian Bronze Co., Ltd., corn.(qu.)-r$1% Feb. 1 Holders of rec. Jan. 19 Preferred (guar.) r50c Feb. 1 Holders of rec. Jan. 17 anadian Dredge & Dock Co., corn r$1% Feb. 1 Holders of rec. Jan. 17 Preferred (guar.) 874c Jan. 31 Holders of rec. Dee. 30 Canadian Industries, Ltd. (guar.) 874c Jan 31 Holders o
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