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financial tinimtrct31 Volume 136 iirnmde New York, Saturday, January 7 1933. Number 3524 7 he F inancial Situation HE death of Calvin Coolidge is a matter for universal regret. Mr. Coolidge's main virtue was the possession of a large amount of practical common sense, which he applied in the conduct of government as he did in private life. He never lost his head or was swept off his feet. He always showed a calm poise and never yielded to political pressure when Congress undertook to force upon the country legislative measures commanding a wide degree of popular support, but essentially unsound. His vetoes on such occasions came with marvelous swiftness and abounded in plain, straightforward language, supported by arguments that carried conviction to all except those who would not be convinced. Illustrations are his vetoes of the deleterious agricultural proposals and the soldier bonus bill, which Congress put on the statute book despite his veto. As a matter of fact, his veto messages, expressed in fearless language, were the most striking feature of his public career. His first veto measure came on May 3 1924, when he refused to approve the so-called Bursam Bill, providing for an increase of about $58,000,000 in the annual pension appropriations, when he declared: "The need for economy in public expenditure at the present time cannot be overestimated. I am for economy. I am against every unnecessary payment of the money of the taxpayers. The welfare of the whole country must be considered. The advantage of a class cannot be greater than the welfare of the nation." And the record was consistently kept up thereafter. On June 7 1924 he vetoed the bill proposing an increase of $300 a year in the salaries of postal clerks and carriers. He pointed out that under its provisions the country would be required to take an additional $68,000,000 a year from the moneys paid by taxpayers. On May 15 1924 he vetoed the first Soldier Bonus Bill, or bill "to provide adjusted compensation for veterans of the World War." The veto proved ineffective, but he characterized the proposal in no uncertain language, declaring it economically unsound and morally unjust. He added: "The gratitude of the nation to these veterans cannot be expressed in dollars and cents. The respect and honor of their country will rightfully be theirs for evermore. But patriotism can neither be bought nor sold. It is not hire and salary. It is not material but spiritual. It is one of the finest and highest of human virtues. To attempt to pay for it is to offer it an unworthy indignity which cheapens, debases and destroys it." No nobler words have ever been penned. But Congress would not listen, and passed the bill over the T President's veto. We might also add that on Feb. 25 1927 he vetoed the McNary-Haugen Farm Relief Bill, declaring it unconstitutional, and that he again registered his disapproval of the measure on May 23 1928, now called the Surplus Control Act, because it embodied many of the same unsound and objectionable features and moreover was still unconstitutional. A courageous and fearless man was expressing his convictions without circumlocution. He was never moved by any consideration except a desire to promote the best interests of the country, and he always had a single eye for the public welfare. During his occupancy of the Presidential office the country enjoyed a period of prosperity such as neither this country nor any other country has ever before witnessed, but it also indulged in speculative excesses and extravagances which were likewise without precedence or parallel, and which were bound to lead to the catastrophe under which the country has been laboring during the last three and •a half years. The vaunted Coolidge prosperity now has a hollow sound, since the whole world is aware that it was all an illusion,freighted with the penalties which the country has been called upon to bear, and, with it, the world at large. If Mr. Coolidge had any fault, it was that during this period he yielded too implicitly to the advice and promptings of his Secretary of the Treasury, Andrew W. Mellon, eminent financier and a man of wide banking experience, much older than Mr. Coolidge, and who ought to have proved a wise counseler. However, we were living in unusual and extraordinary times, and it would have been impossible for Mr. Coolidge to make any progress against the solid mass of those who would have been sure to oppose him in any efforts to apply a curb. We are persuaded, however, that had Mr. Coolidge occupied the position of Chief Executive during the four years just passed, he would have handled the situation differently than Mr. Hoover has done, and perhaps have prevented the business collapse from reaching such desperate extremes. Possessed of such a vast amount of common sense and hard, practical knowledge, he would have seen the folly of engaging in attempts to prevent a readjustment of economic conditions to a normal basis. It is inconceivable that he would have called the business leaders of the country together and have enjoined upon them to proceed as if nothing had happened. Of course the collapse would have come in any event, even if Mr. Coolidge had remained in the Presidential office, since a day of reckoning was inevitable. His cele- 2 Financial Chronicle brated declaration,"r do not choose to run," is now seen to have possessed a greater significance than it was supposed to have at the time. He unquestionably wanted to escape the duties and responsibilities of the Presidential office for another term. But though he meant to guard against a physical breakdown, there seems to be a fatality about the lives of ex-Presidents in this country. The experience has been that they never survive long after their term of office has expired. Theodore Roosevelt and Howard W.Taft are recent examples. Mr. Coolidge was only 60, which in these days is not very old. We are not among those who believe that despite his popular hold he could have been re-elected even if he had chosen to run, since there are hosts of people who will not under any circumstances vote for a President for a third term, and on the occasion referred to he could have added to his fame, making it as immortal as that of George Washington,if he had put his refusal on the single ground that he did not believe that any man should accept a nomination for a third term. There are inherent political dangers in such a course which ought never to be inflicted upon the country. The fact remains that Mr. Coolidge performed the duties of the Presidential office with rare fidelity, and will always hold high rank in that respect. His death at this time is unquestionably a great loss. By reason of his wide experience and his rugged character and his possession of the homely virtues of which the world is in such great need, he was in • position to render services as inestimable as those he rendered as Chief Executive by giving sound and sensible advice. His recent appointment as the head of the National Transportation Committee for the investigation of the condition of the railroads of the country, a problem of great difficulty, was one of the directions in which he was qualified to render great service to the country. We subscribe to the comment of Thomas Cochran, of J. P. Morgan & Co., when he says: "The country will feel Mr. Coolidge's death as a great loss. Careful, prudent, sagacious, of the highest integrity, completely devoted to the public welfare, Calvin Coolidge was of the modest but r ged type whose virtues cannot be appraised too ghly." Jan. 7 1933 "With this purpose in mind, the Conference has decided that there should be no change in the System's policy intended to maintain a substantial amount of excess member bank reserves, the continuance of which is deemed desirable in present conditions. Adjustments in the System's holdings in the open market account will be in accordance with this policy." There is something cryptic about the foregoing utterances, which leave many things open to conjecture, but the sum and substance of what is intended is undoubtedly contained in what is said about the open market policy of the Reserve System. This the public is informed is to be continued. "The first and immediate objective of the open market policy," it is stated, "was to contribute factors of safety and stability in meeting the forces of deflation." Proceeding further, we are informed that "The larger objectives of the System's open market policy, to assist and accelerate the forces of economic recovery, are now assuming importance." It is then added: "With this purpose in mind, the Conference has decided that there should be no change in the System's policy intended to maintain a substantial amount of excess member bank reserves, the continuance of which is deemed desirable in present conditions. Adjustments in the System's holdings in the open market account will be in accordance with this policy." This is the same easy money policy which has been made to do duty on so many occasions in the past, and which never succeeded in achieving its purpose, but which is to continue to do duty nevertheless. No sooner had the speculative bubble burst in the autumn of 1929—in trade as in the stock market-7. than the Reserve authorities announced their determination to maintain an easy money policy. There was a two-fold purpose in this. By keeping credit easy and money rates low, banks would be induced to make investments in bonds yielding a higher rate of return, thereby checking the downward tendency of bond prices, which was becoming a serious feature, and the same easy money policy was sure to bring a revival in trade. But neither of these objects was attained. Bond prices moved lower and still lower, creating a very serious situation, while business depression, instead of being relieved, grew in intensity. After two years' trial had demonstrated the policy HE Federal Reserve authorities have outline to be a flat failure, the Reserve authorities remained their policy for the immediate future. It is undeterred. They were not the least discouraged. contained in a statement given out on Thursday Their comment single was that the policy had not had night, and which reads as follows: sufficient trial. A longer period was necessary to "The Open Market Policy Conference of the Federal Reserve System, with representatives from all demonstrate its success. We were asked to wait and of the 12 Federal Reserve banks in attendance, con- see the sure success which would follow if the policy cluded its meetings with the Federal Reserve Board were given a longer period of trial. In the summer of 1931 there came the breakdown to-day. The sessions of the Conference were devoted to a review of economic, business, financial and in Austria and in Germany,and towards the close of banking conditions in each of the 12 Federal Reserve September 1931 Great Britain found herself obliged districts and to the economic and financial situation to suspend gold payments. Gold now flowed out in in the country as a whole. large volume, and, of course, the Reserve authorities "Particular reference was made in the discussions to the workings and effects of the open market policy were anxious to be helpful. The result was that it thus far pursued by the Federal Reserve System was deemed incumbent to extend the easy money during the course of the economic depression. Con- policy a step further by enlarging their open market sideration was also given to the attitude of the Sys- operations. Still later, European doubts as to the tem in adjusting its operations to conditions and ability of the United States to remain on a gold needs as they may change and develop. basis led to hoarding of gold on a considerable scale. "The first and immediate objective of the open And, of course, the Reserve authorities felt called market policy was to contribute factors of safety to upon again spring to the rescue. Their open marand stability in meeting the forces of deflation. The ket operations again came into play, and on a larger objectives the of System's larger open market policy, to assist and accelerate the forces of economic re- scale than before. It was then that the Reserve covery, are now assuming importance. banks began purchasing United States Government Volume 136 Financial Chronicle securities with unparalleled freedom. Week after week they added to their holdings of United States securities, at the rate of about $100,000,000 a week. It is admitted by the Reserve authorities themselves that the money then hoarded has in large measure returned. Furthermore, daily and weekly Reserve statements show that gold is flowing into the country in a perfect stream, with the result that all the financial centers are congested with funds to a degree and an extent never before witnessed. Let the reader remember that previous to the financial breakdown in Europe the plea that hoarding made the easy money policy of the Reserve System a necessity could not be offered. But now that hoarding is a thing of the past,and further that the National banks have in the meantime been clothed with authority to put afloat about a billion dollars of additional bank circulation, is it not about time that the Reserve authorities began disgorging some of their vast holdings of United States securities? But they,in effect, tell us by their statement of this week that there is no intention of doing anything of the kind—that their huge masses of holdings of United States securities must be held intact in order that there may be no contraction of the amount of Reserve credit outstanding. Is there not a serious menace in such a policy, and are not the results likely to be detrimental in any event? The Reserve System now holds no less than $1,850,000,000 of United States securities, thereby furnishing an artificial market for United States Government securities at a time when the country is plunging steadily deeper into debt. Owing to the immense amount of uninvested funds concentrated at the financial centers, the Government is able to float new issues of Government obligations at rates so low as to border on the absurd. Two weeks ago it sold $100,039,000 of 91-day Treasury bills on a discount basis at a price so high that the rate of return to the purchasers of the bills was at an average of only nine one hundredths of 1% per annum (0.09%), which means that the Treasury obtains the use of $100,039,000 for 91 days at an outright cost of only $22,009. How long is this process to continue? How long can it continue, and when the change comes, what then? Is there not a possibility that the change may come suddenly and unexpectedly, and what position will the Government then be in, and what the result upon investors in United States securities? One grave objection now is that the rate of return to the banks and financial institutions indulging in such purchases of Government obligations at abnormally low rates of interest is not sufficient to enable the banking business to be conducted at a profit. Suppose for any reason the banks should change their policy. Suppose that necessity or sound policy should impel them to make a change, what then? Suppose that eventually the Government will be obliged to pay a considerably higher rate, as seems inevitable, will not the resulting depreciation in the large volume of Treasury obligations put out at the present abnormally low rates of interest prove a very serious matter—we mean not merely the Treasury bills, but the certificates of indebtedness and other short-term obligations. We recall that the City of New York, oh Sept. 24 1931, sold to local banks a total of $57,000,000 tax notes and revenue bills, of which $51,000,000, due in three months, bore interest at only 13 / 8%, while $6,000,000, due in four months, 3 was sold at 11/2%, the most favorable terms ever received by the city, according to press reports. During the month of October 1931, however, when there was a realization of the true condition of the city, the municipality, in borrowing $48,500,000 on note issues due in January and February 1932, was obliged to pay interest rates of 4, 41/ 2% in 4 and 41/ order to obtain the needed funds. Later in the year the city paid as high as 51/ 2% for its short-term borrowings. In view of all this, do not the queries we have put seem decidedly pertinent? In Chicago, protest is already being made against the policy of the Treasury and the Reserve authorities, in allowing a situation so full of menace all around to develop, and bankers have announced their determination not to engage in the purchase of Treasury bills at the abnormally low rates now prevailing. The Chicago "Tribune" on Saturday last, in an article on its financial page, by Howard Wood, outlined the feeling in Chicago as follows: "Chicago banks, it was learned yesterday, are in open revolt against the artificial easy money policy of the Federal Reserve Board and the Treasury Department. They have drastically scaled down their purchases of Government bills and certificates. One leading Chicago bank has stopped buying any 'Governments' at all, and actually has cash representing nearly 55% of its deposits excluding Government bonds and other liquid assets. Rather than buy Treasury bills and certificates yielding less than one-tenth of 1% per annum, banks prefer to keep cash. 'When the yield of "Governments" gets down below a quarter of 1% per annum, the clerical labor required to put them on the books costs more than the interest yield,' said one bank executive yesterday. "Something more important than the cost of clerical help, however, has caused bankers of late to veer away from Government paper. The conviction is growing in financial circles that the artificially low interest rates fostered by the Treasury for political reasons cannot last much longer, and that when interest rates on Government securities find their natural levels the market prices of Government bonds will go down. 'The present situation is ridiculous,' said another bank executive yesterday. 'Politicians in Washington assail the banks for not lending money to deserving loan seekers, and at the same time they take our own money and invest it in Government short-term paper through the Federal Reserve.' He was referring to the so-called 'open market' operations of the Federal Reserve banks, by which they buy large amounts of Treasury bills and certificates at low interest rates. Since the passage of the Glass-Steagall Act last February the Federal Reserve banks have been empowered to use these Government securities, in place of commercial paper, up to a maximum of 60% as backing for Federal Reserve notes. The remaining 40% must be gold. "Ever since the passage of the Glass-Steagall Act bankers in the Chicago district have opposed the manipulation of Government bond prices by the Federal Reserve as a dangerous experiment. Of the 12 Federal Reserve banks throughout the country the Chicago Federal Reserve Bank has stood out alone in its opposition to this policy. "For a time last spring, when foreigners were staging a run on United States gold and United States Government bonds were falling, Chicago bankers withheld their criticism. Since then they have repeatedly attempted to get the Reserve authorities to liquidate some of their vast holdings of Government securities. "About the middle of December there was $2,174,346,000 of Federal Reserve credit outstanding, and $1,850,726,000 of this amount represented reserve 4 Financial Chronicle credit employed in the acquisition of United States Government bonds. "'They've got the cart before the horse again,' says one Chicago banker. 'When they should be holding Government bonds they don't have any. Now when they should be getting in a position to extend credit to business by curtailing their purchases of Government bonds,they keep loading up with them. "'At the same time officials of the Reserve System and the Treasury criticize the banks for not lending more freely to business. I think it has been pretty well demonstrated that what business needs is not easier money but the chance to make a profit. "'The politicians say we won't lend. The truth is that we can't find anybody who will borrow money. Our new business department has been combing the town for customers to whom we can lend money. Nobody wants money. The borrower can't find a way to invest it at a profit if he does borrow. For his small needs he employs his own surplus funds. "'Of course we can always find bad loans to make, poor risks to bail out of some other loan or second. grade speculative bonds to buy. But if they think in Washington that their easy money policy will force us to make bad investments and bad loans, they are going to be disappointed.' "Along La Salle Street the current attempt of the Reserve authorities to regulate the price of money is regarded as just another price stabilization venture like those of the Federal Fa`rm Board. "The end of the experiment is not far off, in the opinion of well qualified observers. Already nearly 40% of the total loans and investments of New York banks is invested in Government bonds. Throughout the country banks have about 25% of their loans and investments tied up in Government paper. This would indicate that banks are not in a position to absorb many more Government securities. "The Reserve banks, with $1,850,726,000 out of $2,174,346,000 outstanding credit represented by Government bonds, are in no position to take on many more. They now hold more than a billion dollars more of such bonds than they held a year ago." In such a state of things as outlined in the above, would not the Reserve authorities be better advised if, instead of saying that there is to be no change in the System's policy, they boldly proclaimed that now that there is no longer any reason for maintaining their investment of $1,850,910,000 in United States securities in order to keep a corresponding amount of Reserve credit outstanding, they mean gradually to dispose of their holdings as the bills and certificates run off. That certainly would restore financial confidence quicker than anything else could,and would also facilitate recovery in trade and business, since the restoration of financial confidence is an absolute prerequisite to trade recovery. Trade hesitancy continues in large measure because on every side the business man is confronted by artificial contrivances and devices, absolutely bewildering in character, making him reluctant to enter upon new ventures or enlarge existing ones until he can get an idea of what is to be the operation and effect of the numerous legislative and governmental schemes ostensibly set up for his benefit and for that of the economic world generally. Jan. 7 1933 much as it is so directly to the point. We take the following excerpts from the article: "It is no exaggeration to say that the Farm Bill reported to the House of Representatives is a measure to establish a temporary dictatorship for the relief of the producers of wheat, cotton, tobacco and hogs. The bill bears a certain resemblance to the Voluntary Domestic Allotment Plan in that it proposes to tax the buyers of farm products and to use the proceeds to reward farmers to reduce their production. But the actual bill reported by the Agricultural Committee differs radically from the original plan. In the place of a specific tax fixed by Congress, 42c. a bushel on wheat and so on, this bill authorizes the Secretary of Agriculture to levy any tax he considers necessary, and to change the tax whenever he thinks it necessary, in order to make wheat, cotton, tobacco and hogs as valuable as they were before the war. "In place of the elaborate but careful and conscientious proposals of the original plan for contracts with the farmers to control their production, this bill authorizes the Secretary of Agriculture to pay the bounty when it appears that production has been reduced 20%. The original plan called for a decentralized control of production and a bounty fixed by law. The present bill throws the whole power of taxation and control into the hands of the Secretary of Agriculture, and authorizes him to relieve the farmers by decree. He is even given the power to say what a farmer may not do with the 20% of his acreage withdrawn from the production of wheat, cotton, tobacco. "The upper limit of the Secretary's power to tax is the difference between the price received by the farmer and the theoretical price the farmer would receive if his wheat or cotton or tobacco or hogs were as valuable relative to all other goods as they were in the years before the war. If, for example, the farmer is to-day receiving 30c. a bushel for wheat and statistical calculations show that he ought to be receiving 90c. in order to have the same purchasing power as he had in 1913, the Secretary of Agriculture must tax the miller of wheat 60c. a bushel and turn over the proceeds to the farmer who has reduced his acreage 20%. "The theory of the bill is that if these particular groups of farmers are given a monopoly of the domestic market, the dictator can force prices upward by any desired amount if he can reduce the supply and also levy any tax that may be necessary. To achieve the purpose of the bill there is no limit to the tax that the Secretary can impose. He can lay taxes of 300 or 400 or 500%; in fact, he must lay them if they are needed, in order to make wheat, cotton, tobacco and hogs as valuable as they were 20 years ago." HE changes in the condition statements of the Federal Reserve banks the present week are along the same lines as in other recent weeks, though it is a little curious that the amount of Federal Reserve notes in actual circulation shows a small increase this time,inasmuch as one would be inclined to look for some reduction in this item, as was the case last week, with the return of holiday money from circulation, and, as a matter of fact, the Reserve authorities themselves report a further decrease of money of all kinds in circulation in amount of $18,000,000 for the week. The volume of Reserve HE Farm Bill reported to the House of Repre- credit outstanding, however, as measured by the bill sentatives the present week is nothing less than and security holdings, has been further reduced, the a legislative monstrosity. We discuss the provisions amount Jan. 4 being reported at $2,139,847,000 as of the bill in a special article on a subsequent page, against $2,157,075,000 on Wednesday night of last but cannot refrain from putting on record here what week (Dec. 28 1932). The reduction is almost enWalter Lippmann has to say with regard to the tirely in the discount holdings, thereby reflecting a measure in an article appearing in the New York diminution in member bank borrowing. These dis"Herald Tribune" on Thursday of this week, inas- count holdings the present week are reported at T T Volume 136 Financial Chronicle $251,102,000 as against $267,382,000 last week. The holdings of United States Government securities are unchanged at $1,850,910,000 this week as compared with $1,850,737,000 last week, but with only $765,945,000 12 months ago on Jan. 6 1932. Gold holdings of the 12 Reserve institutions have further expanded,the total rising from $3,148,531,000 last week to $3,173,356,000 the present week. Of the increase, $11,510,000 is due to the arrival of gold in connection with the payment made by the Bank of England of the British debt payment on Dec. 15. This is evident from the fact that the gold held abroad diminished during the week from $72,638,000 to $61,128,000. Of course the addition to the gold holdings served further to raise the ratio of reserves, but not to the extent that might be expected, inasmuch as there was at the same time an increase in the Federal Reserve note liabilities, already referred to, and likewise in the deposit liabilities. The deposit liabilities have risen from $2,563,238,000 to $2,587,376,000, and the increase is almost entirely in the reserve account of the member banks, which has moved up during the week from $2,481,674,000 to $2,514,451,000. Altogether the ratio of total reserves to deposit and Federal Reserve note liabilities combined is 63.0% against 62.7% last week. The amount of United States Government securities pledged as part collateral for Federal Reserve notes outstanding has decreased during the week from $428,500,000 to $426,100,000. There has been some increase in the total of acceptances purchased by the Federal Reserve banks for account of foreign central banks, the amount this week being reported at $40,157,000 against $36,338,000 last week. Twelve months ago, on Jan. 6 1932, these acceptance holdings of foreign central banks still aggregated $269,544,000. The deposits held by the Federal Reserve banks for account of foreign banks are a trifle lower this week, at $18,853,000, as against $19,053,000. Last year at this time these foreign bank deposits footed up $64,645,000. JIE New York stock market this week has shown an improved tone. There was some hesitancy in the course of prices on Tuesday, the first business day of the new year, and considerable dissatisfaction was expressed over the fact. On Wednesday, however, the market moved up with considerable vim, and the upward movement continued the rest of the week, the volume of trading, which had been extremely light on Tuesday, increasing as the rise in the market continued. The advance was checked temporarily Thursday afternoon on the news of the sudden death of former President Calvin Coolidge, but was resumed on Friday. The bond market again gave a good account of itself, some appreciation in bond prices being recorded in the case of even the low-priced issues, while the high-priced issues were in good demand and also generally advanced. United States obligations continued their display of strength, and a rise was also the feature of some foreign government issues, in particular German bonds. The strength of the bond market, of course, infused new spirit into the stock market. The developments have not been altogether favorable. A statement made by Senator Borah in the United States Senate during the course of a debate on Tuesday, Jan. 3, to the effect that he planned to introduce legislation designed to bring about expansion or "reflation" of the currency, and thereby T 5 reduce the value of the dollar, had a very disturbing effect abroad, with the result that many of the foreign exchanges turned against this country. Here, however, the statement passed entirely unnoticed, no one feeling that any measure of that kind would stand even a remote prospect of finding support. The introduction of the Farm Bill in the House of Representatives, with its extraordinary provisions, was viewed with dismay, but seemed to cause no concern. There was nothing very encouraging in the trade reports; the "Iron Age" reported a rise in steel ingot production from last week's rate of 13% to a current average of 14%, but said, "except for heavier demand for products required by the automobile industry the steel business the beginning of the year manifested few signs of improvement," and added that "unless steel demand from miscellaneous sources showed a gain similar to that of last autumn, it seemed likely that mills would remain for some time dependent on the motor car and container industries for their main support—these two influences having been almost entirely responsible for the rise of 1% in increased ingot production for the week." The grain trade and the cotton market took a more favorable turn, and the rate for sterling exchange showed an upward tendency, even while the other foreign exchanges were weak. The May wheat option at Chicago closed at 481/ 4c. a bushel as against a close for the same option on Friday of last week of 451/ 8c., and the spot price for cotton in New York was marked up to 6.30c. on Wednesday, and was 6.25c. yesterday as against 6.10c. on Friday of last week. On Friday the railroad stocks displayed great strength on overnight news that at the conference between President-elect Roosevelt and Democratic leaders there had been discussion of the possibility of liberalizing the terms under which the Reconstruction Finance Corporation could make loans to the roads. Announcement that the Stock Exchange would be closed to-day (Saturday) on account of the funeral of ex-President Coolidge led to some short covering by those unwilling to continue their short commitments over a double holiday. A disposition is growing to take an optimistic view of things on the Stock Exchange. Call loans on the Stock Exchange continued unaltered at 1%. Trading has been on a moderately large scale. At the half-day session on Saturday last the sales on the New York Stock Exchange were 539,473 shares; Monday was New Year's Day and a holiday; on Tuesday the sales were 489,010 shares; on Wednesday, 1,093,088 shares; on Thursday, 1,143,905 shares, and on Friday, 1,141,910 shares. On the New York Curb Exchange the sales last Saturday were 163,413 shares; on Tuesday, 87,120 shares; on Wednesday, 140,920 shares; on Thursday, 150,030 shares, and on Friday, 190,365 shares. As compared with Friday of last week, prices are slightly higher, as a rule. General Electric closed yesterday at 16 against 15% on Friday of last week; Brooklyn Union Gas at803 4 against 79; North American at 30% against 29%; Standard Gas & Elec. at .143 4 against 13; Consolidated Gas of N. Y. at 62 against 5934; Pacific Gas & Elec. at 303 4 against 30%; Columbia Gas & Elec. at 17% against 16%; Electric Power & Light at 67 / 8 against 63 / 8; Public Service of N. J. at 54% against 53½;International Harvester at 23% against 21%; J. I. Case Threshing Machine at 45% against 42%; Sears, Roebuck & Co. at 211/ 8 against 19%; Montgomery Ward & Co. at 6 Financial Chronicle Ian. 7 1933 / 4 against 36; against 71/ 4; Woolworth at 353 141/ 8 against 131/ 8 on Friday of last week; Kennecott CopSafeway Stores at 41/ 1 2 against 41; Western Union per at 10 against8/ 78;American Smelting & Refining Telegraph at 297 / 8 against 28; American Tel. & Tel. at 13% against 127 / 8;Phelps Dodge at 51/4 against 5; / 8 against 105; International Tel. & Tel. at Cerro de Pasco Copper at 7% against 6%,and Caluat 1077 / 8; American Can at 59% against 557 7% against 67 /8; met & Hecla at 27 / 8 against 2/ 1 2. United States Industrial Alcohol at 26% against 253 / 4; Commercial Solvents at 11% against 10/ 1 4; TOCK exchanges in the foremost European finanShattuck & Co.at 93 / 4 against87 /8,and Corn Products cial centers started the current year with at 55/ 1 2 against 54%. modest cheerfulness. Prices advanced, on the whole, Allied Chemical & Dye closed yesterday at 87/ 1 2 in the dealings at London, Paris and Berlin, in reagainst 831/ 8 on Friday of last week; Associated Dry flection of the increasing optimism of Europe. The Goods at 43 / 4 against 33 / 4; E. I. du Pont de Nemours improved sentiment in London is based largely on a at 39 against 37%; National Cash Register "A" at higher coal output in Great Britain, and increas8 against 8; International Nickel at 8% against ing railway traffic returns. Such indices are con81/ 8/ 1 4; Timken Roller Bearing at 16 against 14½; sidered more important at the moment than a lack Johns-Manville at 221/ 4 against 20½; Gillette Safety of improvement in the index of British wholesale Razor at 19 against 181/ 8; National Dairy Products prices. Much financial progress has been made in at 177 / 8 against 17; Texas Gulf Sulphur at 23% the last year, it is believed, notwithstanding the against 22/ 1 2; Freeport Texas at 26 against 25%; continued gold payment suspension, and further adAmerican & Foreign Power at 7% against 614; vances toward economic recovery are confidently United Gas Improvement at 20% against 20; Na- looked for this year. In French financial circles, tional Biscuit at 40/ 1 4 against 39%; Coca-Cola at also, the opinion prevails that the worst of the de77/ 1 4 against 74; Continental Can at 403 / 4 against pression has been seen,and that substantial improve39%; Eastman Kodak at 563 / 4 against 55%; Gold ment now is likely. Berlin reports reflect greater 1 4 against 151%; Standard Brands hopefulness than those from any other large center. Dust Corp. at 16/ at 151/ 2 against 15; Paramount Publix Corp. at 2/ 1 2 Trade and industry in the Reich have shown material against 17 / 4 against %;West- if irregular gains of late, while the financial posi/ 8; Kreuger & Toll at 1 inghouse Elec. & Mfg. at 30% against 281/ 4; Drug, tion is immensely improved in comparison with that Inc., at 35 against 361 / 2; Columbian Carbon at 32% of six months ago. Measures to regulate Italian against 29; Reynolds Tobacco class B at 30 against industry, and thus minimize the effects of the de281/ 2; Liggett & Myers class B at 55 against 52; pression, are soon to be taken by the Fascist GovernLorillard at 12/ 1 2against 121 / 4, and Yellow Truck & ment, Rome reports indicate. Although hopeful Coach at 35/s against 3. aspects are not lacking in any European market, the The steel shares have also moved slightly higher. optimism engendered thereby is not of the exuberant United States Steel closed yesterday at 297 /8 against variety, as it is realized that world economic 27% on Friday of last week; United States Steel progress will be slow and painful at best. National preferred at 623 / 4 against 60½; Bethlehem Steel at budgets everywhere are unbalanced, while the re1 2, and Vanadium at 13/ 155/s against 14/ 1 2 against moval of foreign exchange and foreign trade restric12/ 1 2 . In the auto group, Auburn Auto closed yester- tions presents an exceptionally difficult problem. day at 53% against 507 /8 on Friday of last week; After the customary New Year's Day holiday,tradGeneral Motors at 133 / 4 against 131/ 8; Chrysler at ing was started in London, Tuesday, with a fair 17 against 16/ 1 2; Nash Motors at 14 against 13%; amount of business and price improvement in nearly Packard Motors at 2% against 21/ 4; Hupp Motors all sections. South African mining stocks were unat 23 / 4 against 2/ 1 4, and Hudson Motor Car at 5/ 1 4 usually active, owing to the suspension of gold payagainst 4/ 1 2. In the rubber group Goodyear Tire & ments by the Reserve Bank of South Africa. The Rubber closed yesterday at 16 against 151/ 8 on Fri- assurance of an increase in the sterling profits of day of last week; B.F. Goodrich at5% against 4/ 1 2; the companies occasioned sustained buying, with United States Rubber at 5% against 4, and the pre- stocks of companies relying on low grade ores in ferred at 10 against 8%. greatest demand. British funds were up at first, The railroad shares are also higher. Pennsyl- but closed with no material change. Industrial vania RR. closed yesterday at 16% against 14/ 1 4 on stocks were in favor, with the exception of textile Friday of last week; Atchison Topeka & Santa Fe issues. The international section was featured by 1 4 against 411/ at 43/ 8; Atlantic Coast Line at 21% further gains in German bonds. An uncertain against 18; Chicago Rock Island & Pacific at 43 / 4 tendency followed, Wednesday, partly as a result of against 3%;New York Central at 19/ 1 2against 177 / 8; profit-taking in the South African mining shares. Baltimore & Ohio at 97 / 8 against 9; New Haven at British funds were dull, and industrial stocks also 151/ / 8; Union Pacific at 74/ 4 against 143 1 4 against were quiet on an irregular trend. International 713 / 4; Missouri Pacific at 3/ 78 against 2½; Southern stocks were lower, but German bonds resumed their Pacific at 173 / 4 against 16%; Missouri-Kansas-Texas advance. After an unsettled opening, Thursday, against 53 / 4; Southern Railway at 61/ 7 4 against prices steadied in most sections at London. Furat 45 / 8; Chesapeake & Ohio at 277 /8 against 271/ 4;North- ther losses were recorded in Kaffir mining issues, ern Pacific at 15 against 13, and Great Northern at on rumors of heavy taxation of the increased com8. 1 2 against 81/ 9/ pany profits. British funds were fractionally lower, The oil shares have held firm, notwithstanding the but industrial stocks showed firmness. Internademoralization of oil prices. Standard Oil of N. J. tional issues were strong as a whole, with favorable closed yesterday at 30% against 30% on Friday of overnight reports from New York a sustaining inlast week; Standard Oil of Calif. at 25% against fluence. The favorable trend was maintained yester24%; Atlantic Refining at 167 /8 against 16%, and day, although British funds again were dull. 8 against 13%. In the copper / Texas Corp. at 137 Trading on the Paris Bourse also was started for group Anaconda Copper closed yesterday at 8% the new year on Tuesday, with the trend favorable. S Volume 136 Financial Chronicle Turnover was not especially heavy, but the market was stimulated by sharp advances in rentes, gold mining stocks and oil shares. In other sections of the market prices moved up more slowly, but steadily, and substantial advances were registered at the close in all groups. The tendency was reversed Wednesday, with trading almost at a standstill. Investors held aloof, owing to disquieting international developments and unfavorable reports from other markets, Paris dispatches said. French and foreign issues alike were in supply, but the losses were small in most instances. The Bourse was heavy Thursday, as well. There was much concern regarding the French budgetary situation, and French rentes, bank stocks and industrial shares moved lower. Some of the international issues tended to improve, especially in the oil, gold mining and copper groups, but such advances were moderate. After an uncertain opening, prices improved on the Bourse, yesterday, and at the close changes were nominal. The Berlin Boerse was active and prices higher in the initial session of the week, which took place Monday. Fixed interest issues showed best results, but there were also substantial gains in various equities. Stocks listed at Berlin gained 2,000,000,000 marks in value during 1932, according to a computation mentioned in a Berlin dispatch to the New York "Times." The issues, however, are still 2,000,000,000 marks below their aggregate value in July 1931, before the panic, when the values were approximately 9,000,000,000 marks,all told. The market trend was downward Tuesday, owing to selling by professional operators, reports said. Mining stocks showed large losses, and this affected other groups. A recovery developed near the close, and net changes were not great. Prices drifted somewhat lower, Wednesday, on a small turnover. Professional selling again was reported, with mining stocks in greatest supply. A rallying tendency appeared once more in the last hour, and losses were confined to small proportions for the session. The trend was favorable, Thursday, with the turnover substantially increased. I. G. Farbenindustrie was a favorite, while other stocks also reflected good demand. Prices drifted downward in a quiet session yesterday. 7 There was an animated discussion of the war debt problem in the United States Senate, Wednesday. Senator Borah, Chairman of the Foreign Relations Committee, charged the present Administration with responsibility for the chain of events which culminated with default by France, Belgium and some of the minor debtors. Former Premier Laval, of France, denied the following day, however, that President Hoover had ever made any pledge of debt revision during the Hoover-Laval conversations in Washington, late in 1931. Of some interest in the present situation was a plea, made Monday by Sir Arthur Balfour, for settlement of the British debt to the United States Government through flotation of a $1,000,000,000 3/ 1 2% bond issue in the United States, amortization to be effected within about 60 years. "That is the maximum we will ever be able to pay," Sir Arthur said. T N AN attempt to resolve a somewhat complicated 1 political situation in the Irish Free State, President Eamon de Valera issued an order early Tuesday dissolving the Dail Eireann, or lower House of Parliament, and calling for new general elections, to be held Jan. 24. Numerous difficulties have been encountered by the Irish Republican party leader, since he assumed the Executive post last March, and formed a coalition which required the support of seven Labor party members of the Dail, who held the balance of power. The Laborites threatened to withdraw their support, late last year, when President de Valera decided to reduce the wages of government employees. The wage reductions were placed in effect Jan.1,despite the threats, and William Norton,leader of the seven Laborites,announced the following day that he would fight the Government's wage cutting policies by "every means at his disposal." A protracted meeting of the Cabinet followed, and at an early hour Tuesday Mr. de Valera announced the dissolution of the Dail. The new Dail will meet for the first time on Feb. 8. The general election later this month will be followed with general interest, not only because of its significance for Irish politics, but because it may possibly cause a change in the Irish attitude on the oath of allegiance to the British Crown, and the land annuities FFICIAL developments relating directly to the payable to the London Government. war debt situation were lacking this week. After announcing dissolution of the Dail, PresiIt was made known in Washington, Thursday, that dent de Valera. expressed confidence that the elecPresident-elect Roosevelt had requested a confer- torate would support his policies and return to Parence with Secretary of State Stimson on inter- liament a sufficient number of Irish Republicans to national affairs, and a meeting is understood to have assure control of the Dail. In the last general elecbeen arranged. Such conversations, however, will tion, held on Feb. 16 1932, the Irish Republicans probably be mainly for the purpose of thoroughly secured 75 seats, against 70 for the Cumann Dan acquainting the incoming administration with all Gaedheal, or opposition group, led by former Presiphases of such subjects as disarmament, world eco- dent William T. Cosgrave. The seven Laborite memnomics, the Far Eastern situation and other prob- bers returned at the same time sided with the Fianna lems, as well as war debts. The default by France Fail, or Irish Republican party, of President de on the interest payment due Dec. 15 has resulted in Valera. abandonment of negotiations for a Franco-American In a Dublin dispatch to the Associated Press commercial treaty, Washington dispatches state. A it was indicated that President de Valera also Prague report of Wednesday to the New York desires a clearer mandate for his conduct of rela"Times" stated that the settlement of the reparations tions with the British Governme nt. He said, accorddue from Hungary and Bulgaria, arranged two years ing to the dispatch, that no British Government is ago,"seems likely to share the fate of the war debts likely to negotiate with the serious purpose of reachto the United States." The two countries already ing an agreement in the dispute on the oath of allegihave ceased making contributions to the fund, on ance and the land annuities so long as it is conthe ground that reparations payments are unneces- vinced that a change would follow if sufficient pressary under the Lausanne agreements, the dispatch sure were exerted to get the present regime out of added. office and power returned to the Cosgrave party. O 8 Financial Chronicle There is considerable doubt regarding the forthcoming election, however, as the business interests of the Free State are almost uniformly opposed to Mr. de Valera's policy with regard to the British Government. London retaliated for the withholding of the annuities by imposing duties on imports from the Free State, and similar action was taken by the Dublin Government on imports from England. The tariff fight has brought severe losses to the Free State agriculturists and business interests, most of whom are believed to favor Mr. Cosgrave's opposition group, which has consistently criticized the de Valera program and urged an amicable settlement of the dispute with London. The two major Irish parties began their election campaigns without delay, Tuesday, and a bitter struggle is in prospect. Jan. 7 1933 leaders do not minimize the seriousness of the present food shortage, it is remarked, but they justify their position by asserting that heavy sacrifices were necessary on the part of the population during the first five-year period to give the nation the necessary means for future development. Among the basic industries, those considerably behind the plan include coal, pig iron, steel, electrification and transport, the Associated Press report states. The "phenomenal success" of agricultural collectivization is reflected in the fact that the country now has 211,000 collective farms and 5,820 State farms, compared with 33,000 and 3,000, respectively, at the beginning of the plan. Individual farms have been reduced from 24,000,000 to 9,000,000. "On the credit side of the ledger," the dispatch says,"must be listed the complete abolition of unemOVIET RUSSIA came to the official end of its ployment, the eradication of illiteracy among more five-year plan of economic improvement on than 50% of the illiterate population, and, in interDec. 31 1932, with some of the original objectives national affairs, wide success in the conclusion of attained, some sadly lacking, and a few far in excess non-aggression pacts with neighboring countries in of first estimates. All emphasis was placed, in this pursuance of the Soviet policy of peace. Meanwhile, ambitious project, on construction and development however, the Soviet State is faced with a mounting in the heavy industries, which absorbed 87% of the unfavorable balance of foreign trade, which has capital investments made in industry. The light forced it to curtail drastically its purchases abroad industries, as those producing consumer goods were and to dispense with all except the absolute minimum called in the plan, suffered from relative neglect. of technical assistance from foreign engineers requirThe agricultural aspect of the plan, which called for ing gold payments." Most of the current month is extensive collectivization of cultivated areas, was to be devoted by the Government authorities and the carried out to a degree that greatly exceeds the early Communist party to study of the control figures, estimates. The plan actually ends, officially, in which are to be made available in full only for the four years and three months from its inception. final year of the plan, and not for the entire period. After an auspicious start,it was announced that only Walter Duranty, the able correspondent of the New four years would be required for realization of all York "Times," observes that the year 1933 will be important objectives, but three months were added one of organization and consolidation for the Soviet Union. He indicates that the Government considers later to make it conform to the Soviet fiscal year. it wiser to get the Socialist mechanism already conindependent and reliable of surveys are A number available as the plan ends. It is pointed out,in most structed into smooth running order than to attempt studies, that the Soviet leaders have attained Con- a huge new advance from ground still insecure. "It siderable success in establishing a broad base for is essential to note," he states,"that, as the Kremlin industrialization of the country. Equally apparent, views the situation to-day, the food shortage is a however, are grave disparities and lapses, which cast result, not a cause. The cause is overgrowth and serious reflections upon the social and economic phi- pruning is the remedy. The food shortage is the losophy underlying the Communist experiment in most obvious symptom, because in the socialization general. Especially dubious, from this broad view- of agriculture the overgrowth was most rapid." point, is a food shortage, which is not due to any RESH aggravations in the protracted Sino-Japaniggardliness of nature and can only be attributed nese dispute regarding Manchuria have approgram that has alienated the to an agricultural sympathies of the vast agricultural population from peared as the result of a sudden and successful the Communist aims. Although the agricultural or assault by Japanese troops on the town of Shanrural collectivization aspect of the plan is officially haikwan, just south of the Great Wall of China. described as a great success, the food shortage places This development is an exceedingly serious one for it in its true light of a tragic failure. Since the all countries with interests in the Far East, as ShanRussian population is 85% rural, this failure is more haikwan is in China proper and is not in any sense important by far than the success achieved in cer- a part of Manchuria. The town is strategically tain aspects of the industrial plan. It has, moreover, located where the Great Wall runs down to the sea, a definitive bearing on the industrial aspects. Since while through it passes the Peiping-Mukden Railindustry is essentially urban, it cannot even exist way, which is the main line of communication beunless an agricultural surplus is available for the tween China proper and the three Eastern provinces maintenance of industrial workers. It is more than known as Manchuria. In their invasion of Manpossible that the success or failure of the five-year churia early last year, the Japanese stopped at the plan, and, indeed, of the Soviet experiment as a Great Wall, and they denied repeatedly thereafter whole, will depend upon solution of the agricultural that they had any intention of entering old China. Despite such assurances, Shanhaikwan was attacked problem. Yearly control figures covering the basic indus- last Monday by 2,600 troops, seven bombing airplanes tries were met, as the plan ended, only in oil pro- and several warships. The Chinese garrison, under duction, and possibly in machine building, a Mos- command of Marshal Chang Hsiao-liang, fled after cow dispatch to the Associated Press states. Sub- a resistance that foreign observers as well as Chinese stantial gains were recorded year by year, on the officials described as determined and valiant. The other hand, in all branches of industry. Russian Japanese are said to have lost only a few men in this S F Volume 136 Financial Chronicle 9 encounter, while the Chinese losses were placed at Tientsin or Peiping, he is reported to have said. 500 dead and many wounded, among the soldiery, General Nakamura revealed, however, that the Japawith "enormous losses" among civilians as well. A nese had seized Shanhaikwan to protect the offensive large part of the Chinese city was reduced to smolder- •against Jehol, a Shanghai dispatch of Tuesday to ing ruins in this battle, reports indicate. the New York "Times" said. This move by the Japanese forces is everywhere General Nakamura took steps toward "settlement" regarded as the prelude to an invasion of the prov- of the incident, Wednesday, by sending a message ince of Jehol, stretching westward from Manchuria. to the Chinese Marshal, Chang Hsiao-liang, containJehol is sparsely populated but is known to contain ing a series of demands. Tokio and Shanghai disvast mineral resources. Various Japanese officials patches agreed that the first of these demands was have admitted recently that conquest of Jehol is for the neutralization of the Chinese city of Shancontemplated, and rumors of the military advance haikwan, no troops of either country to be stationed have been current for months. Indeed,it is generally there in the future. Tokio indicated that "adjustbelieved that the Japanese militarists will not rest ment of railway arrangements" must be made, but until all of Inner Mongolia has been brought under Shanghai reported that the Japanese demanded conthe flag of the Japanese puppet State, Manchukuo. trol of the Shanhaikwan railway station. Tokio The War Department in Tokio announced late last stated that an "intimation" had been given that week that Japanese military forces in Manchuria Japanese troops would not be withdrawn until the will be approximately doubled through conversion terms are accepted, while Shanghai reported a deof the divisions now there from skeletonized peace- mand on the part of the Japanese commander for an time strength to full war strength. This announce- apology, to be tendered by the local Chinese comment was made in explanation of the huge army mander at Shanhaikwan. The Chinese National appropriation of 447,000,000 yen to be included in Government at Nanking decided to make a few dethe forthcoming national budget. Shanghai reports mands of its own, Thursday, and a note was preof last Saturday stated that the Japanese forces sented to the Japanese Minister there calling for were being concentrated on the Jehol frontier in withdrawal of Japanese troops from Shanhaikwan, large numbers. A Shanghai dispatch of Wednesday and punishment of the officers who directed the to the New York "Times" states that Japanese au- attack against the town. The Japanese Government thorities in Shanghai, Peiping and Tientsin frankly was urged to take precautions against recurrence of admit that the occupation of Shanhaikwan will be such attacks as that at Shanhaikwan. The Chinese prolonged until after the subjugation of Jehol. Or- Government reserved the right to claim indemnity ders were issued for Japanese civilians in parts of for losses in the bombardment of the town. Japaold China contiguous to Manchuria to proceed to nese accounts of the incident were branded as "atJapan "and remain in the homeland until the opera- tempts to evade responsibility for their unwarranted tions against Jehol have been completed," the dis- action." In a lengthy statement issued the same patch states. day,the Nanking Government charged that the JapaThe Japanese invasion of Shanhaikwan was pro- nese, by their occupation of the border town, had voked, according to the official apologists at Tokio, placed themselves in position to descend upon Tienby aggressive actions on the part of the Chinese. tsin, Peiping and Jehol at any moment, which fact The latter were accused of having thrown two hand "is fraught with the gravest international possigrenades against the headquarters of the Japanese bilities." gendarmerie stationed at Shanhaikwan in accordMuch concern was occasioned in official circles ance with the terms of the Boxer protocol of 1901. in Washington by these events. It was intimated, Japanese troops who wished to search for the offend- however, that no immediate change in the official ers were fired on by the Chinese, it is further main- attitude of the United States Government is likely, tained. The Chinese claim, on the other hand, that in view of the impending change in the Administrathe Japanese blew up the door of their own headquar- tion. "President Hoover during the rest of his Adters, presumably to provide "evidence" of a Chinese ministration intends to stand on previous declaraattack as a pretext for the occupation of the town. tions of rights and policies with respect to Japanese Tokio reports of Tuesday assert that the Japanese occupation of Chinese territory," it was said in a were not prepared for an attack on Shanhaikwan, dispatch of Tuesday to the New York "Times." The "even though Tokio has never concealed its intention American policy, as laid down by Secretary Stimson, ultimately to expel the so-called rebels from Jehol." consists essentially of the non-recognition of gains The Japanese War Office issued orders for localiza- made in violation of existing treaties. Katsuji Detion of the conflict, and Japanese commanders in buchi, Japanese Ambassador to Washington, called Chinese treaty ports also were ordered to avoid action on Secretary of State Stimson, Thursday, to give unless the Chinese became aggressive. "The incident him the Japanese version of the fight at Shandoes not necessitate any change in Japanese policy," haikwan. After this conference the Ambassador inan official statement said, Tuesday. "If the Chinese formed newspapermen that Japan has no desire to prove their sincerity by taking proper steps to pre- seize any territory south of the Great Wall of China. vent the extension of hostilities, the Japanese army He maintained, an Associated Press dispatch said, will treat the affair as a local incident and will take that the Japanese are doing everything in their power no steps to aggravate the situation." These protesta- to localize the Shanhaikwan situation. In Geneva; tions are especially interesting in the light of con- where the League of Nations Assembly recently gave versations which were held the same day by Lieu- completely ineffectual consideration to the Lytton tenant-Governor Kotaro Nakamura, Commander-in- report on Manchuria, silence was preserved on this Chief of the Japanese forces in China, with com- latest development in the dispute. There was no manders of all foreign forces in Tientsin. There was decided reaction to the incident in any European no immediate danger that the Japanese would occupy capital. Financial Chronicle 10 R. JUAN B. SACASA, who was elected President of Nicaragua in an election supervised by American troops, was inaugurated in elaborate ceremonies at Managua, last Sunday. On the following day the final contingents of United States marines were withdrawn from the country, ending the 4/ 1 2year occupation which began when civil war threatened the lives and property of American citizens. Nicaraguan citizens found cause for rejoicing in both incidents, dispatches from Managua indicate. The stability introduced in Nicaragua by the occupation and the successive free and quiet elections has brought a general hope that peace and prosperity will prevail in the Central American republic. Dr. Sacasa, who was elected Nov. 6 last, succeeded General Jose M. Moncada in a tranquil change of executives. The new President urged all Nicaraguans to co-operate with the Government to bring about peace in the northern section of the country, where bandits still are active. The evacuation of Nicaragua by United States military forces was completed -without incident, Monday. An announcement by the State Department in Washington noted the withdrawal and commented that "the retirement realizes in fact the intention announced by the Department of State in February 1931 of withdrawing the marines following the Presidential election of 1932." Aims and accomplishments of the occupation were noted in the statement, which added: "This country has considered it a privilege to assist Nicaragua and -will always look with friendly sympathy and satisfaction upon the progress which Nicaragua, through her own efforts, will inevitably achieve in the future. The United States desires for Nicaragua, as for her sister Republics in Central America, peace, tranquillity, well-being,and the just pride that comes from unimpaired integrity." D HERE have been no changes the present week in the discount rates of any of the foreign central banks. Present rates at the leading centers are shown in the following table: T DISCOUNT RATES OF FOREIGN CENTRAL BANKS. Country. Rate in PreDate Effect dous Jan. 6 Established. Rate. Austria_ __. Belgium_ Bulgaria_ _ _ Chile Colombia CsechosioTakla_ _ __ Danzig_ ___ Denmark_ _ England... Estonia__ Finland__ France_ _ _. Germany__ CImom 6 334 834 434 5 Aug. 23 1932 Jan. 13 1932 May 17 1932 Aug. 23 1932 Sept. 19 1032 434 4 334 2 534 634 234 4 A Sept.24 1932 5 July 12 1932 5 Oct. 12 1932 4 June 30 1932 2I4 Jan. 29 1932 634 Apr. 19 1932 7 Oct. 9 1931 2 Sept.21 1932 5 mos 21055 In 7 236 934 534 6 Country. Rate in Dale Sited Jan. 6 Established. Holland— Hungary.-India Ireland-Italy Japan Lithuania_. Norway__ Poland,_. Portugal Rumania_ _ Spain Sweden..... Switzerland 234 Apr. 18 1932 434 Oct 17 1932 4 July 7 1932 3 June 30 1932 5 May 2 1932 4.38 Aug. 18 1932 7 may 5 1932 4 Sept. 1 1032 8 Oct. 20 1932 1334 Apr. 4 1932 Mar. 3 1932 7 6 Oct. 22 1932 334 Sept. 1 1932 Jan. 22 1931 2 Predous Rate. 3 5 5 334 6 5.11 734 434 734 7 8 634 4 234 Jan. 7 1933 torother accounts. The reserve ratio rose from 16.82% a week ago to 18.22%. A year ago the ratio was 24.6%. Loans on Government securities fell off £290,000, while those on other securities increased £27,604,637. The latter consists of discounts and advances and securities which rose £27, 481,082 and £123,555 respectively. The discount rate remains 2%. Below we show the different items with comparisons for five years: BANK OF ENGLAND'S COMPARATIVE STATEMENT. 1033 Jan. 4. 1932 Jan.6. 1931 Jan. 7. 1930 Jan.8. Circulation a 362,599.000 362.859.093 383,504,599 362,921,772 Public deposits 12,516,000 15.680.723 13,206,470 17,210,657 Other deposits 168,355.389 120.327.070 102.167,891 111.275,367 Bankers' accounts184-120.092 81,823.788 68,874.566 75.701.298 Other accounts— 34.235,297 38,503.282 33,293,325 35,574.069 Govt. securities 102,081,000 64,890,906 53,081.247 69,885.855 Other securities 63,852,465 55,688,457 37,270.156 30,366,704 Disct. & advances 45.990,482 19,898.960 14,357,675 15.081.971 Securities 17,861.983 35,789,497 22,912,481 15,284,733 Res've notes & coin- 32,067,000 33,465,312 43,053,315 46.293,097 Coin and bullion. 120,566,933 121,324,630 146,557,914 149,214,869 Proponotres.to flab. 18.22% 37.31% 24.6% 36.02% Bank rate 2% 3% 6% 1929 Jan. 9. 369,517,787 10,994.607 104,304,663 67,491,247 36,813,416 57,736,855 30,655,786 14.686,357 15,969,429 44,961,493 154,479,280 38% % On Nov. 29 1928 the fiduciary currency was amalgamated with Bank of England note issues, adding at that time £234,199,000 to the amount of Bank of England notes outstanding. HE Bank of France in its statement for the week ended Dec. 30, records a decline in gold holdings of 102,994,458 francs. Total gold holdings now stand at 83,016,505,715 francs, in comparison with 68,863,039,681 francs a year ago and 53,736,958,426 francs two years ago. Credit balances abroad and bills bought abroad show decreases of 215,000,000 francs and 36,000,000 francs respectively. A large increase appears in note circulation, namely 2,462,000,000 francs. The total of circulation, which now stands at 85,027,273,165 francs, compares with 85,724,954,190 francs last year and 78,937,582,475 francs the previous year. An increase is shown in French commercial bills discounted of 289,000,000 francs, while the items of advances against securities and creditor current accounts underwent a loss of 14,000,000 francs and 2,002,000,000 francs respectively. The proportion of gold on hand to sight liabilities stands this week at 77.29%, as compared with 60.51% a year ago. Below we furnish a comparison of the various items for three years: T BANK OF FRANCE'S COMPARATIVE STATEMENT. Changes Status as of for Week Dec. 30 1932. Dec. 311931. Jan. 2 1981. Francs. Francs. Francs. Francs. Gold holdings____Dec. 102,994,458 83,016,505.715 68,863.039,681 53,736,958,426 Credit bale. abed-Deo.215,000,000 2,938,796,317 12,354,219,771 7,226,887,687 a French commer'l bills discounted_Inc. 289.000,000 3,437,203,715 7,388,787,427 7,430,824.458 bulls bought abr'dDec. 36,000,000 1,545,747,773 8,756.771,296 19,386,400.248 Adv.asst.secure_ _ Dec. 14,000,000 2,515.138,123 2,729,921,132 3,114,874,556 Note circulation__Inc.2462,000,000 85,027,273,165 85,724,954,190 78.937,582.475 Cred. curt. acc'ts-Dec.2002000.000 22,383,792,088 28,081,463,737 22,701,921,767 Proportion of gold on hand to eight 0.43% Dec. liabilities 77.29% 60.51% 52.87% a Includes bills purchased in France. b Includes bills discounted abroad. HE Reichsbank's statement for the last quarter In London open market discounts for short bills of December show an increase in gold and on Friday were 13-16@%%, as against 1 1-16%© bullion of 6,147,000 marks. The Bank's gold is 11 /% on Friday of last week, and 17 4@1% for three now 806,223,000 marks, which compares with 983,months' bills, as against 1 1-16@13'% on Friday of 955,000 marks last year and 2,215,781,000 marks last week. Money on call in London on Friday was the year previous. Decreases appear in reserve in %. At Paris the open market rate remains at foreign currency of 3,667,000 marks, in silver and 1%, and in Switzerland at 13/2%. other coin of 85,041,000 marks and in notes on other German banks of 6,618,000 marks. Notes in circuHE Bank of England statement for the week lation show an expansion of 189,215,000 marks, ended Jan. 4 shows a decrease of £26,739 in raising the total of the item to 3,560,459,000 marks, gold holdings, but as this was attended by a con- in comparison with 4,775,776,000 marks a year ago traction of £8,594,000 in circulation, reserves rose and 4,778,259,000 marks two years ago. Bills of £8,567,000. The Bank's gold holdings now total exchange and checks, advances, investments, other £120,566,933, as compared with £121,324,630 a assets, other daily maturing obligations and other year ago. Public deposits increased £3,651,000 and liabilities register increases of 251,855,000 marks, other deposits £32,185,676. Of the latter amount 72,937,000 marks,469,000 marks, 119,325,000 marks, £31,710,502 was to bankers' accounts and £475,174 153,586,000 marks and 12,606,000 marks respec- T T Financial Chronicle Volume 136 11 tively. The proportion of gold and foreign currency bill buying rate of the New York Reserve Bank is 1% to note circulation is down this quarter to 25.8%, as for 1 to 90 days; 1 for 91 to 120 days, and 134% compared with 24.2% last year and 56.2% the for maturities from 121 to 180 days. The Federal previous year. A comparison of the various items Reserve banks show a decrease in their holdings of for three years appears below: acceptances, the total having moved down from REICHSBANK'S COMPARATIVE STATEMENT. $33,307,000 last week to $32,617,000 this week. Their Changes Dec. 31 1932. Dec. 31 1931. Dec. 31 1930. for Week. acceptances for foreign correspondents holdings of Assets— Retchsmarks. Relchsmesks. Reich:marks. Reiehsmarks. Gold and bullion Inc. 6,147,000 806,223,000 983,955,000 2.215,781,000 increased during the week from $36,338,000 to Of which depos. abr'd. Unchanged. 40,435,000 111.916,000 222,017,000 Res've In torn curr'cyDec. 3,667,000 113,837.000 172.298.000 469.243,000 market rates for acceptances are $40,157,000. Open Bills of exch. & checksIno. 251,855,000 2,806,088,000 4,241,914.000 2,571,566,000 Silver and other coin—Dec. 85,041,000 177,124,000 81,515.000 138,868,000 as follows: Notes on oth.Ger.bks-Dec. 6,618,000 3,104,000 8,990,000 2,068,000 Advances Investments Other assets Inc. 72,937,000 Inc. 469,000 me. 119,325.000 176,063,000 397,529,000 933.638,000 244,633,000 160,682,000 981,409,000 mammiesNotes in circulation Ine. 189,215,000 3.560.459,000 4,775.776,000 4,778,259,000 Oth.daily inatur.oblig.Inc. 153,586,000 539,856,000 754,870,000 651,819,000 Other liabilities Inc 12,606,000 745,865,000 850,497.000 328,568.000 Propor. of gold & to?,, curr.to note eircurnDefi. 25.8% 1.4% 24.2% 56.2% CHANGE of any kind occurred in the New York money market this week. Nor would it seem that any change is likely to develop in the early future. The extraordinary ease in the market is based largely on the open market operations of the Federal Reserve System. The open market conference of the System met in Washington, Thursday, and announced thereafter that there will be "no change in the System's policy intended to maintain a substantial amount of excess member bank reserves, the continuance of which is deemed desirable in present conditions." It was added that "adjustments in the System's holdings in the open-market account will be in accordance with this policy." In the money market circles of this city the latter part of the statement was accepted as an indication that holdings will be gauged by the return of currency to the banks and by gold gains. Call loans in the official market were quoted at 1% for all transactions this week, but in the unofficial street market rates of 32 to VI% were quoted every day. Time loans were unchanged. The total of brokers' loans reported for the week ended Wednesday by the Federal Reserve Bank of New York was unchanged at $394,000,000. The Stock Exchange tabulation for the entire month of December reflected an increase of $9,192,100 to $346,804,658. The summary of gold movements for the week to Wednesday night, issued by the Federal Reserve Bank of New York, reflected a net gain in the country's stocks of $18, 018,000. N O EALING in detail with call loan rates on the D Stock Exchange from day to day, 1% was the ruling quotation all through the week both for new loans and renewals. The time money market has shown no improvement this week. Rates are quoted nominally at M% for 30 to 90 days, 32@3i% for four months and Yi©1% for five and six months. There has been moderate demand for commercial paper this week with a slight increase on Friday The supply of paper shows improvement but there is still a shortage of the most desirable offerings. Quotations for choice names of four to six months' maturity are 13og13/2%. Names less well known are 2%. On some very high-class paper occasional transactions at WI% are noted. HE demand for prime bankers' acceptances has T been fairly brisk this week, but the supply of offerings is poor. Rates are unchanged. The quotations of the American Acceptance Council for bills up to and including three months are IA% bid, 3A% asked; for four months, N% bid and 4% 3 asked; for five and six months, 78% bid and 4 3 % asked. The SPOT DELIVERY. —180 Days— —150 Days— —120 Days— Asked. Bid. Asked. Bid. Asked. Bid. 256,013,000 102,454,000 498,658,000 Prime eligible bills Prime eligible bills Si Si Si Si Si —90Days— —60Days— —30Days— Asked. Bid. Asked. Bid. Asked. Bid. Si Si Si M M M FOR DELIVERY WITHIN THIRTY DAYS. Eligible member banksEligible non-member banks-4 -- 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 ON ALL CLASSES AND MATURITIES OF ELIGIBLE PAPER. Federal Reserve Rank. Burton New York Philadelphia Cleveland Richmond Atlanta Chicago St. Louis Minneapolis Kansas City Dallas San Francisco Rate in Effect on Jan. 6. Date Established. Previous Rate. 344 244 334 334 334 344 244 344 344 344 334 334 Oct. 17 1931 June 24 1932 Oct. 22 1931 Oct. 24 1931 Jan. 25 1932 Nov. 14 1931 June 25 1932 Oct. 22 1931 Sept. 12 1930 Oct. 23 1931 Jan. 28 1932 Oct. 21 1931 244 3 3 3 4 3 344 234 4 3 4 234 TERLING exchange firmed up promptly in the S new year's trading, though the market has been comparatively inactive on this side. On Saturday last there was no market in London and on Monday, due to legal observance of the holiday, there was no market in New York. The range this week has been % to 3.3434 for bankers' sight bills, comfrom 3.323 4 down to 3.30 last pared with a range of from 3.335 week. The range for cable transfers has been from 3.327A to 3.34/, compared with a range of from 3.333 down to 3.3034 a week ago. The market reported that there was considerable buying of sterling in Paris and in other Continental centers. This buying was accentuated on Wednesday on news that Senator Borah and a few others propose to introduce legislation to depreciate the dollar and to bring about other measures of inflation in the United States. This inflation talk in the Senate not only turned the attention of European traders to the London market but caused the franc, the guilder, and other units here to shoot above the point where gold could be profitably exported from Europe to the United States on an exchange basis. Doubtless on banking advices from this side as to the low esteem in which the inflationist advocates were held, the market recovered from its nervousness and trading dropped back to more normal channels. Nevertheless, the nervousness caused by these rumors indicates clearly that European interests still watch Washington more or less apprehensively, as the belief generally prevails in all markets that recovery must take place here on an important scale before there can be any world improvement.S The market had evidence several times during the week that Paris was buying sterling rather heavily and there was frequent evidence also that the London author- 12 Financial Chronicle ities likewise intervened to arrest the upturn. At present there is no essential change in the trend of sterling beyond the fact that it has recovered the normal lull characteristic of the holiday season. The market is greatly interested in the action of sterling in the course of the next few weeks. It is clear that the undertone of the exchange is very firm and the opinion is gaining strength that the rate would rise rapidly if the London authorities would permit the unit to take its natural course. The principal factor affecting sterling at present is the fact that England is now entering the export season when the seasonal pressure on the exchanges is lifted. It is pointed out that last year sterling moved from 3.39% on Jan. 2 to the high for the year of 3.833/i on March 28. Bankers seem generally to hold the opinion that no attempt will be made by Great Britain to return to gold for a year and a half at least, because in the first place the British authorities will await the outcome of the international conferences on armaments, economics, and other important matters. If these questions are resolved satisfactorily, it is believed that London will try to keep sterling stabilized for a year at least. If such a course is followed, sterling would not return to gold before the early autumn of 1934. It is further asserted in some quarters that the return would be to this temporary stabilized level at some figure considerably below the par of 4.8665. However, it is well to realize that all such opinions can be nothing more than pure guess work as the London authorities will certainly divulge no accurate information until they are prepared to take action. After a temporary year-end firmness, money has again receded in the London open market and is in great abundance. Two-months' bills are 13-16% to %%, three-months' bills 15-16% to 1%, fourmonths'bills 1%,and six-months' bills1% to 1 1-16%. These are about the rates which prevailed throughout the last quarter of 1932. This week the Bank of England shows a decrease in gold holdings of 06,739, the total standing on Jan. 5 at £120,566,933, which compares with £121,324,630 a year ago. Notes are now coming back to the Bank from circulation after the year-end and holiday peak, so that the reserve shows an improvement, standing at 18.22%, against 16.82% on Dec. 28. It is expected that the ratio will improve again next week from the same cause. At the Port of New York the gold movement for the week ended Jan. 4, as reported by the Federal Reserve Bank of New York, consisted of imports of $27,585,000, of which $11,510,000 came from England, $6,855,000 from France, $5,712,000 from India, $2,127,000 from Holland, $1,216,000 from Canada, and $165,000 chiefly from Latin-American countries. There were no gold exports. The Reserve Bank reported a decrease of $1,099,000 in gold earmarked for foreign account. It also reported a loss in gold by a decrease in gold held for its account abroad of $11,510,000. In tabular form the gold movement at the Port of New York for the week ended Jan. 4, as reported by the Federal Reserve Bank of New York, was as follows: GOLD MOVEMENT AT NEW YORK,DEC. 28-JAN. 4, INCLUSIVE. Exports. Imports. 211,510,000 from England 8,855,000 from France 5,712,000 from India None. 2,127,000 from Holland 1,218,000 from Canada 185,000 chiefly from LatinAmerican countries. 27,585,000 Jar:. 7 1933 Net Change in Gold Earmarked for Foreign Account, Decrease: 21,099,000 Lou Through Decrease in Gold Held Earmarked Abroad, 211,510,000 The above figures are for the week ended Wednesday evening. On Thursday $5,115,500 of gold was received $8,021,800 of which ca ne from France, and $1,094,700 from Holland. There were no exports of the metal on that day, but gold held earmarked for foreign account increased $900,200. Yesterday, $1,602,300 of gold was reported received from Holland as additional for Thursday. Yesterday $20,000 was exported to Switzerland. Gold held earmarked for foreign account decreased $162,800. Yesterday's report also showed a decrease of $1,607,200 in gold held earmarked for foreign account as additional for Thursday. For the week ended Wednesday evening, approximately.$844,000 of gold was received from China at San Francisco. Canadian exchange continues at a severe discount, but just fractionally more favorable to Montreal than last week. On Saturday last Montreal funds were at a discount of 11%% (in contrast with 169% at the end of 1931). On Monday there was no market in New York. On Tuesday, Montreal was at a discount of 119/ s%,on Wednesday at 113.%, on Thursday at 113'%, and on Friday at 113 /%. Referring to day-to-day rates, sterling exchange on Saturday last was firm although London was closed. Bankers' sight was 3.32%@3.33; cable transfers 3.32%@3.333'. On Monday, legal observance of New Year's, there was no market in New York. On Tuesday sterling advanced. The range was 3.33@), 3.33% for bankers' sight and 3.33%@3.34 for cable transfers. On Wednesday the undertone was firm. Bankers' sight was 3.33@3.343g; cable transfers 3.33 9-16@3.34 5-16. On Thursday sterling was firm. The range was 3.34@3.343 for bankers' sight and 3.3434@3.34% for cable transfers. On Friday, sterling was again firm; the range was 3.339/8© 3.343/i for bankers' sight and 3.33%@3.34% for cable transfers. Closing quotations on Friday were 3.34 for demand and 3.343/i for cable transfers. Commercial sight bills finished at 3.33k; 60-day 2; documents for bills at 3.323 4;90-day bills at 3.323/ payment (60 days) at 3.33 and seven-day grain bills at 3.339/8. Cotton and grain for payment closed at 3.333 4. XCHANGE on the Continental countries presents no new features of importance from those in evidence for several weeks before the year-end. French francs are again tending toward ease, having risen to an extreme high on Wednesday of 3.913/i for cable transfers, which compares with the closing rate of 3.909/i on Friday of last week. The sharp rise in the franc on Wednesday is regarded in the market entirely as a response to Tuesday's debate in the Senate on money and to Senator Borah's plan to propose legislation seeking deflation and a reduction in the value of the dollar. Until this rise and for some weeks past the franc had been ruling at levels which made it possible to export gold from Paris to New York on an exchange basis. The franc has now risen above this level and exchange traders are inclined to believe that the franc may be maintained above the gold point for some time until it becomes more clearly evident what the Senate debate and Mr. Borah's proposals may lead to. However, it is worth while to point out that the franc receded on Thursday from the very E Volume 136 Financial Chronicle 13 The London check-rate on Paris closed at 85.69 on high level of the previous day. It may be that against 84.75 on Friday of last • nervousness caused by the debates will entirely Friday of this week, York sight bills on the French centre subside and that gold •imports from Paris to New week. In New 4against 3.903. on Friday 3.903 York may be resumed, though the market is in finished on Friday at 3s / transfers at 3.903 % against 3.90 , considerable doubt as to this. In Paris it is pointed of last week; cable sight bills at 3.903/8, against 3.9014. out that from now on seasonal factors should favor and commercial finished at 13.853/ for bankers' the franc and it is thought that the gold movement Antwerp belgas for cable transfers, against to New York should not be unduly great if purely sight bills and at 13.86 quotations for Berlin Final . 13.853/2 economic factors only are regarded. The weekly 13.85 and sight bills and 23.783/ ' bankers for 23.78 were statement of condition of the Bank of France as of marks son with 23.803/2 and compari in s, transfer Dec. 30 shows a loss in gold holdings.of 102,994,458 for cable 4 for bankers' closed at 5.113 francs and a net decline of 215,000,000 francs in 23.81. Italian lire s, against transfer 5.123' for cable total foreign balances. Both changes reflected the sight bills and at closed at gs schillin n 8. Austria 5 and 5.123/ weakness of the franc which had been a feature of 5.11% lovakia Czechos on e 14.103, against 14.08; exchang the foreign exchange market until Wednesday. at st Buchare on 0.6034, The activity of the Bank of France in the exchange at 2.96%, against 2.9634; 11.20, against , 2 11.243/ at market in support of the franc is shown by the steady against 0.60; on Poland Greek 1.473/2. against , 2 1.473/ decline in the aggregate of foreign exchange holdings, and on Finland at and bills sight ' bankers for which now amount to 4,266,000,000 francs, against exchange closed at 0.523/ and % 0.523 against s, transfer % for cable 4,625,000,000 francs on Nov. 18. According to Paris at 0.525 dispatches the foreign credits of the Bank of France 0.52%. are nearly exhausted. It is pointed out there that XCHANGE on the countries neutral during the in view of the heavy adverse merchandise balance war is slightly more active as the result of during 1932, the large gold imports of 1932 were operations. Holland simply a consequence of the liquidation of its foreign the completion of year-end widely, but on balbalances which the bank undertook since the Govern- guilders have fluctuated rather last week. The ment assumed liability for possible losses on the ance are essentially unchanged from Both currencies Bank's depreciated sterling balances. It is believed same is true of the Swiss franc. guilders going market, that the Bank of France foreign balances have been rose sharply in Wednesday's points. This 4 francs Swiss so reduced that its power to absorb gold from other up WA points and remarks radical to entirely ed was attribut centers is exhausted and that the Bank must either advance y incurrenc ng regardi Senate States United the export gold or take measures to insure a higher volume in are , however es, exchang neutral The here. flation of foreign balances, especially in the New York trends in l change essentia any show to d expecte not on market. The Bank of France total gold holdings now on under normal Dec. 30 stood at 83,016,505,715 francs, which com- for some weeks, although from favor all the should factors l ns seasona conditio 1931 31 Dec. on pares with 68,863,039,681 francs export season begins and with 28,935,000,000 francs in June 1928 follow- European currencies, as their and before it is well advanced ing stabilization of the unit. The Bank's ratio almost immediately ly favors the European units. stands at 77.29%, compared with 77.72% on Dec.23, tourist traffic ordinari es are firmer, owing to currenci with 60.51% on Dec. 31 1931 and with legal re- The Scandinavian , to which they are sterling of s quirement of 35%. The Bank's ratio was at record the higher average is steady but Spain on e Exchang closely allied. high on Dec. 16, when it stood at 78.16%. German marks are of course largely nominal, as the dull. Bankers' sight on Amsterdam finished on Friday , Reichsbank has strict control of all foreign exchange Friday of last week; transactions. Berlin takes great pride in the fact at 40.193/2, against 40.18 on 40.181A, and comagainst 40.20, at s that the stability of the mark seems assured. The cable transfer against 40.173'. , 40.153/2 at bills sight Reichsbank statement as of Dec. 31 showed an in- mercial and at 19.2634 checks for 19.26 at closed francs crease in gold coin and bullion of 6,147,000 marks. Swiss and 19.2434. 19.24 against s, transfer cable for Total gold holdings are now at 806,223,000 marks, and cable 17.343 at finished checks gen ding Copenha notes and the ratio of reserve gold against outstan Checks is 25.8%. This compares with 27.2% a week earlier transfers at 17.37, against 17.14 and 17.15. s transfer and with 26.5% a month ago. A year ago the Bank's on Sweden closed at 18.223/ and cable on checks gold reserve stood at 983,955,000 marks, and on at 18.23, against 18.11 and 18.12; while s at Dec. 31 1930 it stood at 2,215,781,000 marks. The Norway finished at 17.233 and cable transfer pesetas Spanish lowest gold holdings during 1932 were 754,109,000 17.24, against 17.10 and 17.11. 8.18 marks on July 15 and the highest were 979,043,000 closed at 8.173 for bankers' sight bills and at and 8.183/2. marks on Jan. 7. Since Dec. 15 the Reichsbank for cable transfers, against 8.16 shows an increase in gold holdings of 17,686,000 XCHANGE on the South American countries marks. In the main most of this gold, like most of No important mid-summer, y since presents no new features. the gold received by German is a more there until d expecte be can ments develop came from Russia. ce. confiden and trade world Italy y in that out points recover wide-spread Rome Italian lire are steady. ly especial has freed herself from certain importations harmful Recovery in the southern republics is of the to her trade balance, has developed electric power, dependent upon complete re-establishment in and has put the meager national rseources in raw British position and freer borrowing markets es exchang the le materials to better use. Italy has scrupulously London and New York. Meanwhi ental and governm troubles avoided contracting excessive debts abroad and at are upset by political ne the same time has developed her own mercantile fleet. restrictions. It estimated that the Argenti flaxseed 000 bushels, 53,000, be will The present feeling in Italian financial quarters is that crop for the season 1932-33 For the earlier. year a bushels 000 against 89,000, the country has achieved a satisfactory equilibrium. E E 14 Financial Chronicle Jan. 7 1933 first three months of the crop year 21,000,000 bushels HE following table indicates the amount of gold have been shipped from Argentina or nearly half the bullion in the principal European banks as of production. Argentina is the chief producer. It will Jan. 5, 1933, together with compar isons as of the dispose of its whole crop before the end of the season. corresponding dates in the four previou s years: Argentine paper pesos closed on Friday nominally 1932. 1931. 1930. 1929. at 253 4 for bankers' sight bills, against 25% on Banks of- 1933. £ £ £ .£ £ Friday of last week; cable transfers at 25.80, against England.... 120,566,93 3 121,324,630 146,557,914 149,214,869 154,479,28 0 France 6 550,904,317 429,895,867 339,469,003 261,432.31 25.80. Brazilian rnilreis are nominally quoted 7.45 Germanya__b 664,132,04 38.289,400 42,867,7 99,679,000 106,702,200 132,185,757 Spain 90,336,000 89,879,000 97,563,000 102,638,000 102,362,0000 for bankers' sight bills and 7.50 for cable transfers, Italy 83,008,00 60,848,000 57,275,000 56,120,000 54,638,000 Netherl'nds 86,053,000 74.880,000 35,513,000 37,289,000 36,212,000 against 7.45 and 7.50. Chilean exchange is nominally Nat. Bel& 74,180,000 72,946, 38,292,000 32,750,000 25,553,000 5w1tzland. 88,962,000 61,042,000 25,609,000 23,799,000 20,698,000 Sweden 11,443,000 11,433,000 quoted 13,381,000 against 63'. Peru is nominal at 18.00. 13,592,000 13,105,000 Denmark 7,399,000 8,015,000 9,560,000 9,581,000 9,600.000 Norway__ _ 8,015,000 6,559,000 8,135,000 8,148,000 8.160,000 4-Total week 1,252,384,379 1.100,698,697 961,460.581 879,303,07 2 818,425,347 XCHANGE on the Far Eastern countries pre- Prey_ week L252_303.723 1.098.411.415 961.217.242 863.394_508 510 23141157 a These are the gold ho dings of the Bank of France as reported in the new form sents no new aspects from recent weeks. The of statement. b Gold holdings of the Bank of Germany are exclusive of gold held Chinese units are firmer on average owing to an abroad, the amount of wl) CO the present year is £2,021,750. advance in silver which was quoted this week from The Farm Parity Bill and Agricultural 243/z cents up to 259/8 cents a fine ounce, against Policy. 243 cents, the all-time low touched on Thursday so-call The ed farm parity bill, formally entitled of last week. Japanese yen continues to hover close "a bill to aid agricul ture and relieve the existing to the record lows and there is no prospect of an nationa econom l ic emerge ncy," introduced in the immediate improvement; if anything the trend of House of Represe ntative s on Tuesda y by Marvin yen is lower. However, Mr. Manzo Kushida, Chairman of the Mitsubishi Bank, in a New Year's mes- Jones, Democrat, of Texas, Chairman of the Comsage said that the yen will not decline further and mittee on Agriculture, is the first of a forthcoming asserted that the Government must take measures series of measures designed to "do something" for to maintain it at the proper level. He said further, the farmers. The further legislation which is re"Regardless of our hopes, Japan cannot avert cur- garded as necessary, as outlined in the report of the rency inflation in 1933. A further advance in prices majority of the Committee, includes "such matters will be unavoidable, and this will involve higher as the farm mortgage and rural credits situation, production costs and higher wages. These ad- unduly burdensome taxation upon farm lands, revances will make it harder for us to overcome adjustment of our currency system in such a way foreign tariff barriers and we may lose our newly as to make our unit of money more truly a measure of existing values, removal of tariff and freight rate acquired markets." discrim inations against the farmer, and restoration Closing quotations for yen checks yesterday were of the export market for agriculture through re20%, against 209/8 on Friday of last week. Hong ciprocal arrangements and other measures." A numKong closed at 21%@21 13-16, against 213@ ber of member bills intended to give effect to various 213/ 2; Shanghai at 27%@,28, against 27%©273 / 8; parts of this program have already been introduced, Manila at 499., against 499; Singapore at 38% but as the farm parity bill, or the domestic allotment against 38%; Bombay at 25.30, against 25 1-16, bill as it has also been called, has been given the and Calcutta at 25.30, against 25 1-16. right of way in the House, and amendments subFOREIGN EXCHANGE RATES CERTIFIED BY FEDERAL RESERVE stituting an essentially different plan would not, BANKS TO TREASURY UNDER TARIFF ACT OF 1922. accord ing to Representative Jones, be regarded as DEC. 31 1932 TO JAN. 6 1933, INCLUSIVE. germane, the extraordinary provisions of the bill as Noon Buying Rate for Cable Transfers fa New York. drafted by the Committee call for careful and deChemin, and Monetary Value in United Mates Money. Unit. tailed examination. Dec. 31. Jan. 2. Jan. 3. 1 Jan. 4. Jan. 5. Jan. 6. EUROPEThe preamble of the bill declares "that the depres8 8 3 $ 8 $ Austria.schliling 139650 .139670 .139920 .139650 .139670 sion Belgium, belga in prices for that portion of our agricultural 138426 .138442 .138465 .138578 .138494 Bulgaria, lev 007200 .007200 .007066 .007200 .007200 Czechoslovakia, kron .029601 commodities for domestic consumption, and .029609 .029608 .029608 .029606 Denmark, krone the .172376 .172530 .172769 .173183 .173253 England. pound effect of unsettled world conditions upon foreign sterling 3 328083 3.337125 3.335125 3.341541 3.344833 Finland, mark ka markets for that portion of our agricultural .0/4433 .014433 .014466 .014528 .014500 France, franc com039022 .039022 .039035 .039080 .039030 Germany, relchsmark .238050 modities for consumption abroad, and the inequal .237960 .237905 .237896 .237660 Greece, drachma i.005276 .005330 .005316 .005316 .005301 Holland. guilder 401723 ties between the prices for agricultural and other .401742 .401828 .402167 .401914 Hungary, pengo_ ._ _ 174250 .174250 .174250 .174250 .174250 Italy. lira 051199 commodities, have given rise in the basic indust .051196 .051199 .051202 .051200 Norway, krone .171483 ry .171607 .171711 .172123 .172292 Poland, zloty .111850 .111812 .111850 .111850 .111850 of agriculture to conditions that have affected Portugal, escudo .030250 .030200 .030220 .030260 .030205 Rumania, leu 005975 .005972 .005972 .005969 .005972 transactions in agricultural commodities with a naSpain, peseta .081528 .081519 .081564 .081767 .081751 Sweden, krona 181515 HOLZ- .181523 .181684 .181969 .182165 tional public interest," thereby necessitating legislaSwitzerland,franc .192391 DAY .192371 .192435 .192655 .192583 Yugoslavia, dinar.... .013520 .013525 .013525 .013560 .013550 tion which shall not only aid agricultural recover ASIAy Chinabut also facilitate recovery in "industry, transportaChefoo tael .281458 .281458 .281458 .287500 .286250 Hankow tael .218541 .278541 .278541 .284583 .283750 tion, employment and finance." The policy of ConShanghai tad .271093 .271406 .271718 .278437 .276250 Tientsin tael .288541 .288125 .288125 .295000 .293333 Hong Kong dollar_ .211250 gress, it is further declared, is "to encourage agri.211250 .212187 .215625 .214062 Mexican dollar .192500 .192500 .192500 .197500 .195000 Ventsin or Petran cultural planning and readjustment to meet change d dollar 192083 .192083 .192083 .197083 .195000 Yuan dollar .191875 world conditions." The bill is limited in its applica .191666 .191666 .196666 .195000 India, rupee.251800 .252375 .252295 .252880 .253065 Japan. yen 205100 tion to wheat, cotton, tobacco and hogs "by reason .205450 .204650 .204810 .205500 Singapore (S.S.)dollar .386312 .386875 .387187 .388125 .388125 NORTH AMER.of the fact that the prices for these basic commod .883281 Canada, dollar .886923 .885468 .886927 .888145 ities .999237 Cuba. Peso .999375 .999237 .999300 .999300 are a controlling factor in establishing prices for Mexico. peso (sliver). .312000 .309833 .309166 .309166 .307400 Newfoundland. dollar .880625 .884250 .882750 .884625 .883500 other domestic agricultural commodities, SOUTH AMER.that exArgentina. peso (gold) .585835 .585835 .585835 .585835 .585835 portabl e surpluses of these commodities or products 076400 Brazil, mllrels .076400 .076400 .076050 .076400 060250 Chile, peso .060250 .060250 .060250 .080250 thereof are ordinarily produced in such quantit 473333 Uruzuay, Lem .473333 .473333 .473333 .473333 ies 952400 .952400 .952400 .952400 .952400 as to make prices on world markets a control ling T sm, E Volume 136 Financial Chronicle factor in establishing domestic prices, and that substantially the entire production of these commodities is processed prior to ultimate consumption." The bill was at first intended to be operative only for the "marketing year" 1933-34,with some extension in the case of hogs to provide for the normal breeding period, and with the possibility of extension for a year, on the recommendation of the Secretary of Agriculture, by order of the President, but a Committee amendment, made before debate began on Thursday, provided for an "initial marketing period" immediately following the approval of the bill. With this declaration of "national interest," the bill provides for the issuance by the Secretary of Agriculture, to producers of wheat, cotton, tobacco or hogs, of adjustment certificates covering, for each producer, "the domestic consumption percentage of the commodity of his own production marketed by him" during the period to which the certificate applies, and representing "the fair exchange allowance"for the commodity as proclaimed by the Secretary on the day following the approval of the bill and thereafter from time to time. Except for hogs, "the fair exchange value for any commodity shall be an amount that shall bear to the price for all commodities bought by producers during the last three months' period for which index numbers are available, the same ratio as the price for the commodity paid producers at local markets during the base period bore to prices for all commodities bought by producers during such base period." The base period is to be that from September 1909, to August 1914. In the case of hogs the fair exchange value is graduated at from 3y2 to 4/ 1 2 cents a pound to the beginning of the marketing year 1933-34, and thereafter 5 cents a pound plus further increases to be determined by the index number for factory employment prepared by the Federal Reserve Board, until the fair exchange value as prescribed for the other commodities is reached. There is then to be levied upon the first domestic processing of either of the four commodities mentioned an adjustment charge, to be paid by the processor, such charge to be at any given time "at the same rate as the fair exchange allowance then in effect with respect to the commodity." For the protection of producers of cotton against "disadvantages in competition," an adjustment charge . equal to that upon cotton is imposed upon the first domestic processors of silk or rayon. The adjustment charge is to be collected by the Bureau of Internal Revenue and paid into the Treasury,2/ 1 2% of the receipts being allotted for the expenses of administering the act. In the case of any class of commodities having a value so low, in proportion to the quantity used for manufacture, that the adjustment charge would prevent their use in whole or in part and thus reduce consumption and add to the surplus,the charge may be abated or refunded. Supplementing the regulation is a duty of 5 cents a pound on imported short staple cotton and jute, a similar duty on imported articles wholly or in chief value of such cotton or jute, and a blanket duty equal to the adjustment charge on imported wheat, cotton, tobacco and hogs. All this, however, is only a part of the scheme. Prior to the beginning of the marketing year, the Secretary of Agriculture is to estimate, "as nearly as practicable," and announce "the percentage of 15 the total domestic production of the commodity during the then current calendar year that will be marketed and needed for domestic consumption." Any producer may produce as much of the designated commodities as he chooses, but no producer of wheat, cotton or tobacco is to be entitled to an adjustment certificate unless his acreage for 1933 is 20% less than "his average acreage for such preceding period as the Secretary deems representative of normal production." In the case of hogs the 20% reduction is to apply to tonnage. If the act is extended for a second year, the prescribed reduction is to be such as the Secretary "has found necessary in order to prevent abnormal surpluses or carry-overs in the commodity." Moreover, the certificate is to be withheld, in the case of crops, if the land which represents the required reduction of acreage is used "for the production of any commodity of which, in the opinion of the Secretary, there is normally produced or is likely to be produced an exportable surplus." Stripped of technicalities and legal verbiage, what the farm parity bill proposes is a Government bounty, equal to the difference between average present prices and average pre-war prices, on the production of wheat, cotton, tobacco and hogs, to be collected in the form of a tax on the first processors of those commodities, and paid over to such farmers as are willing to cut down their acreage of wheat, cotton Or tobacco or their tonnage of hogs by 20%, and agree to use the surrendered acreage in such manner as the Secretary of Agriculture shall approve. Incidentally,the import duties on the commodities in question are to be boosted by the amount of the bounty, plus 5 cents a pound in the case of short staple cotton and jute and some of their products. The only important limitation appears to be that the bounty will not be paid on the exportable surplus of either of the specified commodities, if such there be. The majority report of the Committee, made public on Thursday, insists that the plan protects consumers, since the adjustment charge, to be levied upon the processor and passed on by him to the consumer, is limited to the difference between present and pre-war prices, and hence "cannot be used by the agricultural interests to force consumers to pay a higher percentage of their income to farmers than was the case before the war." "The various adjustment charges," the majority report declares, "will undoubtedly cost the consumer money, but this money will promptly be spent by the farmer in ways which will decrease unemployment and add to the profits of business." The bill seems to us to be specious in its theory and mischievous in its practical application. We agree entirely with the forcible criticisms of the bill voiced by the eight minority members of the Committee. The agricultural situation is undoubtedly serious, but if it is to be taken in hand it must be dealt with in some other manner. The bill will be no less objectionable if, as is practically certain to be the case,the clamor of agricultural and political interests forces the inclusion of other produc ts in the regulated and favored list. Rice growers, for example, are already reported as insisti ng that rice has as must claim to Government aid as cotton or tobacco. Moreover, a primary object of the bill is the stabilization of prices by Government action, and the experience of the Federal Farm Board alone should be sufficient to show how idle such a pro- 16 Financial Chronicle posal is as well as the huge sum of money that the experiment may cost. The minority members of the Committee are also, we believe, on solid ground in challenging the bill from the points of view of both processors and consumers. The bounty, it is admitted, will be passed on to the consumer, if for no other reason than because the processor, in the present state of prices and trade, cannot afford to absorb it if business is to be done at a profit. If the consumers, on the other hand, faced with what the minority members properly describe as "a magnified sales tax on the necessities of life," are unable or refuse to pay the tax, they will turn to substitute products, and the bounty-protected farmers will sell less of their products because processors cannot afford to buy. The theory of the bill appears to be that the amount of the designated products which the Secretary of Agriculture may decide represents the volume of domestic consumption will be taken off irrespective of the price—a theory which seems to us entirely fallacious. The bill is further objectionable because of the extraordinary administrative machinery that would be required to enforce it. Aside from the elaborate statistical calculations and forecasts which are devolved upon the Department of Agriculture, nothing less than a small army of functionaries (which, by the way, the Secretary of Agriculture and the Secretary of the Treasury are given unlimited authority to create) would suffice to supervise the sales of producers,the purchases of processors, the prescribed reduction of acreage or hog tonnage, and the use of land included in the 20% reduction of acreage. Whether the 21/ 2% of the adjustment charge which is reserved to pay the cost of administration would be sufficient for that purpose cannot be determined now, but the elaborate machinery must be set up whether the reserved percentage is sufficient or not. At a time when the most urgent need in Federal financing is a rigorous reduction of public expenditure, the farm parity bill should be defeated on grounds of economy as well as because of the entirely unsound theory upon which its provisions are based. A bill which, if it worked at all as planned, would give the farmer artificial prices for certain of his products at the expense of the whole nation of consumers is not a measure which the present Congress can afford to enact or the Presidentelect approve. Technocracy—Man and His Tools. Man has been called a tool-using animal. The dictum cannot be disputed,for his entire strength comes from his ability to construct and use tools. Recently there has arisen a school of thought which under the name of "technocracy" advances the view that unemployment and other maladjustments in economic and industrial life are caused by improvement in tools and machinery. Before the idea of technocracy was launched, probably about the same time though without knowledgeable concurrence, a bishop of the Anglican Church fervently urged the industrial leaders of Great Britain that the world stood in need of a 10-year holiday in invention and science. His Lordship was impressed by the hue and cry raised in the name of technological unemployment. The good bishop thinks it reasonable to believe that industrial, price and employment stability threatens to be overthrown by the application to Ian. 7 1933 industry of the innumerable marvels of the scientist and inventor. The technocrats also believe that new inventions bring in their wake the same class of evils, together with others of greater magnitude. Technological unemployment is new only in name. It has existed in fact ever since the invention of the axe, the saw, the spade, and the potter's wheel. The pace of unemployment due to obsolescence of tools is no greater now than it was in the most ancient times. The fact that now our instruments are for the most part power-driven machine tools does not alter the situation. The proverb has it that money is the root of all evil. Economically it is the breath of life. Ancient society was doomed when coined money was invented. The use of money was the first great economic achievement. Individual mobility, liberty, and money developed together. Only when wages were paid in money could the workman have free time, freedom to stop working, to choose his occupation, and to change his residence. Coined money and day's wages sounded the knell of slavery. Ox-teams are still yoked to ploughs in various parts of the world, and even in the United States there are still oxen following the furrow to "Gee" and "Whoa" despite the vast developments since the surrender to the British in 1812 of the little village of Detroit, where to-day many millions of automobiles and tractors are turned out to supplant "Spot" and "Hike," the oxen, and their fellow toiler, Burgoo King, the horse. The technocrats tell us, pointing to the fact as a horrible example, that one man in Detroit, by the easy manipulation of a mechanical device,loads thousands of chassis onto flat cars, whereas but for the invention of this mechanical lifter, or derrick, or whatever it may be called, perhaps many hundreds of men might find employment in accomplishing the task. They overlook the fact that millions of automobiles are in use, giving employment to armies of men in the relatively new occupation of chauffeur and providing enormous numbers of workers with a means of livelihood in the service of these machines. We are told that had Eli Whitney never invented his cotton gin, cotton would never have become the king of crops, and by enriching the Southern States have fastened upon them the institution of slavery, which was already beginning to wane. Thus, technocracy would have us believe that Eli Whitney was indirectly responsible for the Civil War. In truth, • the invention of the cotton gin made possible the employment of a million workers in the manufacture of the staple throughout the Northern States and created flourishing industries in England, Germany, Poland,France and Italy. The Southern States have long since supplanted the North in the manufacture of cotton. They are richer than they ever were. Cotton• is still King, and the numbers employed in its manufacture throughout the world have increased by many hundreds of thousands and by many, indeed, since 1865. And take just a brief look at Eli Whitney. He was born in New Haven, Conn., in 1755, was graduated from Yale in 1792, and in the same year went to Georgia as a teacher. There almost immediately, as a result of his observations of the laborious process of cleaning cotton by hand, he invented the very simple box which gave rise to so much technological unemployment. He must have made a fortune. Inventions of far less significance have been known to Volume 136 Financial Chronicle 17 gone into industrial pile up great wealth for their creators. As a matter which would undoubtedly have of labor. employment the of fact, his workshop was broken into and his machine investment and for unemployment. machines our blame We cannot was stolen and others were made from it before he created by obsolescence the in danger no is could secure a patent. He returned to Connecticut There all, it is at danger is there If genius. inventive and subsequently did make a fortune in the manuto be the individual permit we that fact the to due Haven. facture of firearms at Whitneyville, near New by his functions of exercise free the in superseded he Hence, following the logic of the technocrats, by is sovereign State The control. bureaucratic World the must have had a hand in starting it the individual, but aggression with permission, War. natural by sovereign and free is Technological unemployment undoubtedly exists. should be recognized, were more universally recogfreedom this If right. as long so will always It always has existed, and nowhere an unemployment be could inventive genius continues to function and to find nized there thing of use that we know single Every co-operation with the talent and genius for manage- problem. beginning of time was the the from about anything ment and for the direction of human activities. working unhampered mind, free one some of product Technocracy is no new discovery. Attempts to conexcept such influguidance of form any by thought in trol invention and to stabilize economic life proved Thomas A. Edilate the as forces guiding and ences failures on numerous occasions in ancient China, Employspace." of out "from proceeded said son long before and even long after the beginning of the flourinvention society where Christian era. It is not new even in the Occidental ment is greatest in any All secure. and abundant world. It was discovered in England about 1800 by ishes and wealth is most and thought, creative of product a man named Lud, whose followers were known as our wealth is the from the wealth thus created. Luddites, because under his leadership they destroyed employment proceeds machinery in Nottingham and other parts of England Cordial for Hard Times. from 1811 to 1816, because they felt that the power Work and Thrift Best States have never beUnited the As the people of looms and spinning wheels and other machines such scope and magof depression a threatened to deprive them of their livelihood. A fore experienced the past three and for them afflicted has few decades after the Luddite riots the inventions nitude as them to stop theorizing, for time is it years, of Watt,Arkwright,and Crompton gave employment one-half each other blaming of the practice to end an Engof put north to the to more spinners and weavers in to individual and for each wrought, havoc the the for almost constituted land than had previously seeing of purpose with the sole case own his study the country. of entire population There is evil in everything that a man uses or what he may do to restore good times. All classes produces, but he puts it there. There is beneficence of citizens have suffered together,from the humblest in all that a man uses or produces when he puts it wage earner to the more fortunate man who was able there. The products of his mind or of his hand are to rely upon an income from investments to meet insentient and completely indifferent to the uses his requirements, and it is folly for them to blame to which they are applied. For our present unem- each other or any individual for the woe which has ployment problems invention and industrial manage- been experienced since 1929. The fact is that during the wave of prosperity we ment cannot be blamed. "Demos" insisted that his danced too hard and too long. Joy was unconall them, has He Government give him high tariffs. with little thought of to-morrow, and, having fined, markets his of part and as a result has lost a large the fiddler had to be paid. Paying for our danced, He idle. lie must abroad, so that many of his tools been mighty disagreeable, but with the adhas folly especially government, to has granted great powers new year, a period when it is customary the of vent taxation by that so rich," the the power to "soak to be satisfied, there is reason to hope obligations for who those majority g overwhelmin the by sanctioned possess the sinews of employment are largely de- that the fiddler's claim has been paid, thus affording prived of their investment powers and more of a sound basis for new and earnest effort. Every interest in this country has suffered during Demos's tools are forced to remain idle. He has by overwhelming numbers sought bureaucratic the depression. Farm products have been abundant, guidance and control in so many of his affairs that, but they have lacked markets, and prices for some through sheer incapacity on the part of his chosen crops have gone to the lowest level in centuries. Lack advisers, talent for management is shackled, more of demand curtailed industry, and there was consequently a natural falling off in railroad traffic which machines stand idle and crops rot. Economic guidance can only come from super- was aggravated by competition of private automomen,that is, from men of directive talent and genius biles, passenger buses and trucks carrying freight. working in free association with men of their own Merchandising and every other form of trade felt the calibre for mutually advantageous ends. Such men oppressive hand of diminishing demand. Operations evolve through economic necessity. They have never of steel, textile, construction and other industries been and never can be selected by popular vote. dropped to a minimum as wage earners dwindled Elected representatives everywhere have been a chief and thin pay envelopes curtailed buying power. Nuagency in creating the present unprecedented volume merous bank failures wiped out savings and deof unemployment. Man will never comprehend the stroyed confidence. There is reason for congratulation that chaos was eternal truth formulated in remote ages and accepted as the entire civilized world was adversely avoided and best enunciated here by Thomas Jefferson: The trying ordeal having passed, the suraffected. governed is best which governed "That country is take hope, stop quarreling about wages, should vivors of this and Government founders their least." The put their shoulders to the wheel and their teeth, grit would three have risen generations for descendants in arms against an income tax. Their later descend- work. It is time to cease talking about a living wage ants have authorized such a tax by Constitutional and the "high standard of living" when many fellow amendment. The income tax has taken vast sums citizens have been compelled to rely upon organized 18 Financial Chronicle public aid for food and shelter. The chances are that with costs of food, clothing and rent very low one can take better care of his family than his father or grandfather did. Responsibility for starting industry and business on a new road to prosperity cannot all be shifted to the employer, who has more at stake than have the persons whom he employs, because in addition to his own services, which correspond to those of an employee, the owner of a factory has a large investment which is entitled to earn a return just as much as is the employee entitled to his wage. The man who relies upon the wage he receives for his daily toil must realize that employers have suffered even as has the employee, and much beyond the same. Idle mills deteriorate, causing a loss at the expense of the owner. Also most employers have invested a portion of their profits in securities in order to be prepared for emergencies. During the past two and a half years not only have the proprietors of industries derived little, if anything, in the way of income from their mills, but many of them have been deprived of dividends upon stocks in which they invested their savings. In times of depression employer and employee are in some respects practically in the same boat, and it is to their mutual advantage that business shall be revived. Of vital importance at this time is the creation of a spirit of good will which will bring about a true and sincere application of reciprocity. In times like the present there should be one universal motive, a desire to rebuild and recognition of an obligation to make a foundation for a new industrial structure which will assure an era of reviving trade. Work and thrift will accomplish more than may possibly be achieved by profligate distribution of private and public funds which may tend to undermine self-reliance and create a false and temporary prosperity, whereas the old-fashioned method has often been tried and never found wanting. Railroad Problems. Measures to bring about a national co-ordination of the three main competing forms of transportation —rail, highway and water—in a way that will promote their proper natural development and at the same time adequately safeguard the public interest were put forward last 'Monday by a special committee of the Chamber of Commerce of the United States. The findings of the Chamber committee were reached after several months of study and investigation of the present chaotic conditions in the transportation industry. The committee recommendations call for the elimination of any unfair advantages and inequitable taxation where they exist among the carriers and a system of regulation "which will permit each agency to function to its best advantage in the public interest in accordance with its inherent merits and without special privileges over other forms of transportation in which there is equal public interest." Specifically, the committee proposes the extension of regulation to cover the rates and services of highway and water carriers; immediate withdrawal of government from barge line operation; a system of taxation for motor carriers designed to apportion equitably their contribution to the cost of maintenance and improvement of highways, including a mileage tax, varying the capacity, on buses; and uniform regulations jam 7 1933 among the States as to the size, weight and speed limitations for commercial vehicles. The committee, in discussing the present difficulties in the transportation industry, comes to the conclusion that a large part of the trouble is due to an over-supply of transportation facilities. "Of the transportation agencies," the committee says, "the railroads are the chief sufferers, and under present depressed conditions few of them are earning their operating expenses and fixed charges. The other forms are sufferingfrom the competition among their own units, however, and many of their operators favor reasonable regulation." Meanwhile, the shippers, while benefiting greatly from the superiority of the service in some instances and the low rates in others, are encountering discrimination and uncertainty in rates and service, the demoralization of glutted markets and other evils which in 1887 brought about legislation for the regulation of the railroads. The over-supply of transportation and the evils of destructive competition are accentuated by the present depressed business conditions, but it is clear that the return of prosperity will not fully solve the problem. The difficulties were becoming apparent before the depression. The committee agrees that unregulated competition with regulated forms of comparable transportation is unfair, contrary to the public interest in the losses which are caused,and inequitable to shippers whose interest is in dependable service and conditions. Regulation should give each form of transportation opportunity to develop its potentialities so long as it does not have unfair advantages over other forms. The chief problems for consideration at the present time are as to the fairness of the conditions under which water transportation and highway transportation are conducted as compared with the conditions which surround or should surround rail transportation. The committee made it plain that nothing in its report should be construed as favoring Or implying the desirability of so regulating highway and waterway rates so as to raise them to the level or in excess of railroad rates. Reference was made in the report to the fact that air transport and pipe line operation also present problems of transportation, but not of sufficient immediate importance to warrant consideration in the committee's findings. The specific recommendations of the committee are as follows: 1. That common carriers by water in domestic commerce should be required to file and adhere to rates, including port-to-port rates, in the manner now required by law with respect to railroad rates, and that such rates or modifications thereof should be subject to approval by the regulatory body, with reasonable differentials between rail and water rates where economically justified. 2. That neither rail nor water carriers should be permitted to establish rates to competitive points which are not adequately compensatory. 3. That all common carriers by water in domestic commerce should be required to obtain certificates of public convenience and necessity, and should thereafter be required to maintain an operating schedule, with the right to modify the amount of service in accordance with the reasonable demand. Operators of existing services should be allowed six months to establish scheduled services and qualify for certificates of public convenience and necessity. 4. That industrial carriers and owners and charterers of other vessels not common carriers should be required to charge the established common carrier rates for cargo other than their own. 5. That Government operation of water transportation is not in the public interest and that it be discontinued. Volume 136 Financial Chronicle 6. That there should be standard uniform requirements in all States as to allowable height, width and length of single and combined units, axle and wheel loads and speeds as recommended by the American Association of State and highway officials. 7. That the enforcement of such uniform vehicle standards and safety regulations and the protection of the highway should be administered by the State in the exercise of its police powers. 8. That the construction and maintenance of general use highways, including costs of designated through highways within municipalities limited to the average per mile cost of high-type State highways should be paid by user taxes, with separate schedules for private passenger automobiles, buses and trucks as follows: For private passenger automobiles (a) a registration fee graduated according to weight or horsepower, and (b) a gasoline tax. For buses and other vehicles carrying passengers for hire (a) a registration fee, (b) a mileage tax graduated according to a seating capacity, and (c) a gasoline tax. For trucks (a) a registration fee, (b) a weight tax graduated so that it will increase more than directly with weight, or a ton-mile tax, and (c) a gasoline tax. 9. That gasoline taxes should not be so high as to encourage wholesale evasion and that the Federal Government should refrain from Federal invasion of this field of taxation. 10. That States enter into reciprocal agreements for issuance of special licenses for commercial vehicles to cover States other than the home State at equitable rates to be determined by the conditions which prevail. 11. That all motor carriers for hire, whether in common carrier of contract service, be required permit to operate, but that common and contract carriers in continuous operation during a stated period, and up to the time the law requiring permits is enacted, be granted such permits without further proceedings if their operations are bona fide for the purpose of furnishing reasonably continuous service and if they meet the other requirements of such legislation. 12. That all motor carriers for hire, whether common or contract, be required to file and post their rates and adhere to them at all times, and that these rates shall be just and reasonable and shall not discriminate among different shippers, the proper regulatory body to have authority to pass upon complaints. 13. That all those using the highways for commercial purposes be required to establish their financial responsibility with respect to public liability and that common carriers be required to establish similar responsibility with respect to passengers and cargo. 14. The hours of service of operators of motor vehicles should be reasonably limited by public authority. 15. The proper regulatory bodies in each State be designated to enforce the provisions of the regulatory laws herein recommended and that these State bodies closely co-operate to the end that the various regulatory measures will be in harmony and will further sound treatment of highway transportation. 16. That in the public interest the same degree of regulation of inter-State as of intra-State carriers should be applied, and that, in regulation of highway transportation, the Federal regulatory body should serve only as a court of last resort, and that provision should be made for delegation of authority to boards of the State bodies in the States involved. 17. That Section 500 of the Transportation Act should not be construed as an expression by Congress of preference for rail or water transportation over highway transportation, or as a declaration by Congress of the relative importance to the public of the several kinds of transportation. 18. That, in reorganization of the Federal Government activities, agencies dealing with transportation be better coordinated and brought into closer working relationship. BOOK NOTICE. "Recent Social Trends in the United States." Report of the President's Research Committee on Social Trends. With a Foreword by Herbert Hoover. Two volumes. New York: McGraw-Hill Book Co., Inc. In September 1929 President Hoover asked the opinion of a group of eminent scientists regarding the feasibility of a national survey of social trends in the United States. 19 The opinion was favorable, and in December a committee of six members, of which Professor Wesley C. Mitchell, of Columbia University, was Chairman, was appointed to make the survey. The report, published on Monday in two stout volumes of 1,568 pages, comprises, in addition to a 75-page summary of the Committee's findings, 29 supplementary reports dealing in each case with some subdivision of the general subject, together with a list of the several hundred persons or organizations which have aided in the collection and analysis of the material. The report is to be further supplemented by 13 monographs dealing more fully with certain of the topics to which the Committee gave its attention. It may be said at once that the report, a novel as well as monumental achievement, embodies the results of much study, though it is too voluminous to admit indulgence of the hope that it will ever have wide reading—in fact, it is repellent on that score. The Committee was confronted at the outset with a bewildering variety of events which have contributed, during the first third of the century, to general and particular social trends. To quote the language of the report: "The World War, the inflation and deflation of agriculture and business, our emergence as a creditor nation, the spectacular increase in efficiency and productivity and the tragic spread of unemployment and business distress, the experiment of prohibition, birth control, race riots, stoppage of immigration, women's suffrage, the struggles of the Progressive and the Farmer-Labor parties, governmental corruption, crime and racketeering, the sprawl of great cities, the decadence of rural government, the birth of the League of Nations, the expansion of education, the rise and weakening of organized labor, the growth of spectacular fortunes, the advance of medical science, the emphasis on sport and recreation, the renewed interest in child welfare—these are a few of the many happenings which have marked one of the most eventful periods of our history. "With these events have come national problems urgently demanding attention on many fronts. . . . Imperialism, peace or war, international relations, urbanism, trusts and mergers, crime and its prevention, taxation, social insurance, the plight of agriculture, foreign and domestic markets, governmental regulation of industry, shifting moral standards, new leadership in business and government, the status of womanhood, labor, child training, mental hygiene, the future of democracy and capitalism, the reorganization of our governmental units, the use of leisure time, public and private medicine, better homes and standards of living—all of these and many others . . . demand attention if we are not to drift into zones of danger." With such an astounding range of topics, the first task of the Committee was obviously that of selection. Broadly speaking, the report excludes from detailed consideration the topics which would naturally find place in a study which was primarily political, economic or financial. There are many references to the business depression, but the report does not undertake to explain the causes of the depression, and it does not go into such matters as exchange and foreign trade or reparations and war debts. The scope of "social trends," as the Committee envisages them, may be gathered from the subjects of the 29 chapters. The list of subjects includes population, utilization of natural resources, invention and discovery, communication, economic organization, types of occupation, education, the rise of metropolitan communities, rural life, racial and ethnic groups (particularly full on the Negro, but omitting Jews), vital statistics, various aspects of family and social life, the labor movement, consumers' habits, arts and religion, health and medical practice, crime and punishment, social and welfare organizations, the growth of governmental functions, taxation and public finance, law and legal institutions, and the general relations of government and society. In spite of their preoccupation with what are commonly known as "social" subjects and their declared purpose to refrain from prescribing remedies, the authors of the various chapters nevertheless let fall a good many observations which bear upon business, financial and governmental conditions and tendencies. The demand for tariff protection for oil, copper and anthracite is instanced as "testimony of the advancing age of the mineral industries of the United States." Over a 10-year period, the immediate outlook is for "ample supplies available at declining cost," but for the long-time outlook "the outstanding facts are the growing difficulties of mining and the prospect of an ultimate increase in cost." The situation fixes attention upon conservation, but that problem "merges with the Immediate social problem of overdevelopment and overproduction." With the World War 15 years behind us, "the current outlay of the Federal Government is more than six times the 20 Financial Chronicle pre-war; the national debt has grown nearly twenty-fold; and the price level is approximately where it was in 1914." Local governments, although far less burdened with direct war expenditures, have increased their expenses and debts "under the influence of example and the combination of rising prices and good business." The appalling growth of taxation between 1913 and 1930 is startlingly brought out by a comparison of the figures for the two years. "In 1913 the aggregate tax bill of the country, Federal, State and local, amounted to 2,259 minion dollars, or $23 per capita. In 1930 the total tax bill amounted to 10,300 million dollars, or $84 per capita. Within 17 years the aggregate burden of taxation had increased by eight billion dollars, or 355%, and the average per capita burden had increased by 250%." Allowing for adjustment to take account of the difference in the value of the dollar, "the aggregate tax collections of 1930, expressed in terms of 1913 dollars, were nearly two and three-quarter times as great as the corresponding collections for the fiscal year 1913." Edwin F. Gay and Leo Wolman, who write the chapter on trends in economic organization, see a trend to the multiplication of branch banking systems, while "group banking, essentially holding company control, represents at this time the major tendency." In spite of confusion in the public mind regarding business organization and social control, the same authors see a marked loss of faith in antitrust legislation as a panacea. Although they can go no farther than to say that the credit policy of the Federal Reserve banks was "perhaps" one of the bases of the excessive expansion of credit after 1920, they comment with some severity upon banking and speculative practices whOse withered fruits the country has been gathering for more than three years. The collapse of the labor banks, only seven of which, with resources of $30,000,000 remained at the end of 1931, was not due, In their opinion, to "the lack of important functions to be served by labor in the application of its financial resources," but to "an essential lack of Interest in the experiment and the traditional inability of organized labor to supply competent and disinterested management." The summary report which prefaces the various specialized studies leaves a distinct impression of apprehension. No social problem, however small or localized, can be isolated and treated in a vacuum, for all social problems are interrelated, but a survey of the American scene shows more of contradiction than of harmony and more drifting than conscious plan. The problem of technological unemployment, the Committee thinks, "promises to remain grave in the years to come." "A change in the distribution of income which put more purchasing power in the hands of wage earners would enormously increase the market for many staples and go far toward providing places for all competent workers, but for the near future we see little prospect of a rapid increase of wage disbursements above the 1929 level. Another possibility is a great expansion of exports, but in a tariff-ridden world that also seems a dim hope." In a society which makes its living by "making and spending money incomes" . . . the effective limit upon production is the limit of what the markets will absorb at profitable prices," but "no business can pay wages for making goods which will not sell at a profit, and no business can make a profit if it pays wages higher than its competitors for labor of the same grade of efficiency." There is need of economic planning, but at present the phrase "represents a social need rather than a social capacity. The best which any group of economic planners can do with the data now at hand . . . is to lay plans for making plans . . . To work out schemes which could be taken seriously as a guide to production and distribution would require the long collaboration of thousands of experts from thousands of places." In spite of this rebuff to economic planning, the Committee, looking at the situation as a whole, appears to see as inevitable an enlarged and intensified measure of social control, to be exercised, it would seem, through the magnification of executive direction and authority. Representative political bodies will still have important functions to perform, but "the almost omnipotent legislative authority" with which the nation began has yielded steadily, and in recent years rapidly, to executive and administrative authority and the courts. Individual initiative and independence, in short, will recede and the centralizing influence of government will advance. The Committee, the report reminds us, was "not commissioned to lead the people Jan. 7 1933 into some new land of promise," but to describe and evaluate recent conditions, "make observations of danger zones" and "point out hopeful roads of advance," but it nevertheless suggests the possibility of setting up a National Advisory Council "including scientific, educational, governmental, economic (industrial, agricultural and labor) points of contact, able to contribute to the consideration of the basic social problems of the nation." "Unless there can be a more impressive integration of social skills and fusing of social purposes than is revealed by recent trends, there can be no assurance" that the more definite alternatives of dictatorship and "power groups," "with their accompaniments of violent revolution, dark periods of serious repression of libertarian and democratic forms, the proscription and loss of many useful elements in the present productive system can be averted." Disclaiming any wish to "assume an attitude of alarmist irresponsibility," the Committee nevertheless declares that "It would be highly negligent to gloss over the stark and bitter realities of the social situation, and to ignore the imminent perils in further advance of our heavy technical machinery over crumbling roads and shaking bridges. There are times When silence is not neutrality, but assent." The sweep of the report is so large as to occasion surprise that the Committee should have surrendered to a proposal which, if early application is contemplated, is obviously impracticable. There can be no doubt that social conditions, using the term in the comprehensive sense which the Committee employs, are in every way as confused, contradictory and alarming as they appear in the report, but neither in the past few years nor for a good many years preceding has the country lacked governmental plans for improving them. Governmental planning has given us the high protective tariff, a scheme designed to encourage industry, keep wages high and spread general prosperity, but industry languishes and foreign trade is hard hit. Governmental planning has given us the Inter-State Commerce Commission and an imposing array of railway legislation, but the railways are near to bankruptcy; it has given us the Federal Farm Board, but $500,000,000 of the people's money has been wasted and grain and cotton prices have collapsed. The Federal Reserve System is an elaborately devised governmental agency, but the speculative orgy that reached its climax In 1920 was largely due to a wholly irrational use of Federal Reserve credit. Any National Advisory Council that might now be set up would inevitably be composed of men most of whom would be inextricably tied to the present economic system, and unable, because of their training and associations, to attack social problems in the detached spirit which the success that the Committee hopes for would require. As politics go in this country, the numerous commissions which Mr. Hoover has set up have been as well constituted as such bodies are likely to be, but the depression has continued in spite of their deliberations and inquiries. It is governmental interference with business, specious theories of government regulation of business, government competition with private business, and control of government by men with special and not national interests to serve, that have gone far to bring the country to the unhappy and perilous state which the Committee undertakes to describe. It is probably true, as the Committee thinks, that the demand for government intervention will grow as the complexity of the times deepens in many individuals a temper of despair. The only hope that such intervention as may come may be more beneficent than that which the country has already experienced lies along a line which runs throughout the Committee's report, but which its final proposal tends to obscure. That is the need of clearer and more intelligent social thinking, fuller recognition of the interdependence of all aspects of social life, and determination to get rid of the obstacles which ignorance, inexperience, inattention, partisanship and greed have set up. If dictatorShip and its attendant evils come, it will be because the American people have neglected to fit themselves, by education, sober thinking and high public spirit, for the new tasks of self-government. Progress in 1932 Seen by James Brown, President New York State Chamber of Commerce—Regards Adjustment of Business to Meet New Conditions As Noteworthy Achievement—Would Instill Spirit of Economy and Sound Business Into Government. In the view of James Brown, President of the Chamber of Commerce of the State of New York,"one of the great accom- Volume 136 Financial Chronicle plishments of the year just ended was an acceptance by American business men of the fact that an adjustment of their affairs to meet new conditions was vitally necessary." "That done," says Mr. Brown, "they proceeded to put their houses in order by the elimination of wastefulness and extravagance and by the adoption of sound business practices. It is perhaps no exaggeration to say that to-day many going concerns are more economically and more efficiently conducted than they have been in many years," says Mr. Brown. lie observes that "their resources have dwindled, the volume of business is smaller, and the profits less, but they rest on a solid foundation, ready to forge ahead fast when the world resumes its interrupted march of progress." In a statement issued at the beginning of the new year, Mr. Brown goes on to say: I call this a real accomplishment, because it is no pigmy task to change in a comparatively brief time from methods of doing business which were developed in prosperous years to methods which will function effectively during the lean years through which the world is now passing. Individually, It has been just 88 difficult to rearrange our mode of living to make it accommodate itself to greatly reduced personal incomes. That we have been able to do these things speaks well for the future of the country and the race. We find that to-day common sense has taken the place of hysteria and despondency, and that economy in operation has become the order of the day. Is there any better task that we can set for ourselves during 1933 than to see that this same spirit of economy and sound business shall be instilled into government—Federal, State and municipal? I am persuaded that, to the extent that this can be done and budgets balanced, to that extent will general business improve, unemployment decrease, and our condition be just that much better on Dec. 31 1933. It is a hopeful sign to see members of civic and commercial bodies such as the Chamber of Commerce of the State of New York taking a greater interest in the affairs of the nation, State and municipalities. Civic welfare and business welfare are closely linked together. Both suffer when wastefulness and unsound practices are widespread in their administration. The year just passed has been one of great activity in the Chamber and justifies brief reference to some of its accomplishments. After many years of effort, the Citizens' Budget Commission was organized through the leadership of the Chamber and incorporated. Its first efforts have been devoted to bringing about a reduction in the expenses of New York City's government, and although the organization is only a few months old, its efforts have already met with considerable success. Its work promises to save the taxpayers millions of dollars, and undoubtedly will bring about reforms in administration of the city's affairs which will be of lasting benefit to the community. By taking a firm stand against the American Government participating with Canada in the proposed canalization of the St. Lawrence River, the Chamber has crystallized the widespread opposition to this project. The Chamber opposed the waterway on the ground that it is economically unsound, commercially unwise and politically inadvisable, and this view is now concurred in by many leading business and civic organizations throughout the country. The Chamber's survey of the prohibition situation, followed by Its advocacy of immediate modification or repeal of the Eighteenth Amendment, attracted nation-wide attention, and, it is felt, was an important factor in moulding public opinion, which was reflected at the last election in favor of a change. The Chamber went on record as favoring a Federal sales tax in the event that other special taxes and reduction in operating expenses were insufficient to enable the Federal budget to be balanced. Its study of the various forms of sales taxes and the arguments of their opponents made a real contribution to the subject and has been widely quoted. Believing that a gales tax should be applied nationally only, a committee of the Chamber has made a strong report against the proposal that New York State should also enact a sales tax. It is a matter of no small gratification to the Chamber that New York City recently adopted the method of financing of the subways which the Chamber has long advocated. During the year the Chamber also continued its efforts to secure unification of all the city transit facilities as being essential to the welfare of the citizens of New York. No review of the Chamber's activities would be complete without reference to the leading part it played in the defense of New York in the so-called New Jersey lighterage case. Regarding the contentions of the neighboring State of New Jersey as unsound and detrimental to the best interests of New York and its industries, the Chamber organized the opposition and led the long fight to uphold the unity of the Port of New York. The Course of the Bond Market. The bond market started off the new year well, with prices continuing to improve in a fairly active market. At the present time, the bond market in general seems to be In a fairly good position after the year-end tax selling. On Friday Moody's price index of 120 domestic bonds stood at 81.66, as compared with 79.68 a week agorand178.10 two weeks ago. The obligations of the United States Government continued their recent performance with some issues moving above the 1932 highs and long-term low-coupon bonds being quoted to yield slightly more than 3%. Prices indicate the possibility of long-term Treasury financing on a favorable basis. This factor has brought selling of Liberty Loan Fourth 4s, since at prevailing levels they show a negative return to the earliest call date. Government obligations as measured by Moody's price index for eight long-term Treasury issues, finished the first week of 1933 21 atI103.51,r_as:comparekwith:102.99_ a week ago:and 102.71 two weeks ago. The railroad bond market was again strong during the past week. Practically all issues participated in the upward movement. General change in sentiment as to the nearness of railroad bankruptcies, rather than outstanding favorable developments in the railroad industry, apparently caused the price improvement in speculative bonds. The increasing demand for a safe investment media for idle funds caused a further price appreciation in the best issues. Atchison gen. 4s 1995 established a new high price at 97 for 1932-33, as did Union Pacific 1st 4s 1947 at 100, and Chesapeake & Ohio 44s 1992 at 101. Among speculative bonds, advances were registered by New York Central deb. 6s 1935,from 53 to 57, Gulf Mobile & Northern 1st 5s 1950, from 213 to 273 4, Illinois Central deb. 43 /0 1966, from 343 to 38, and New York Westchester & Boston 1st mtge. 4s 1946, from 34 to 43. The price index for the railroad group on Friday was 71.96, as compared with 69.40 a week ago and 67.07 two weeks ago. During this past week continued strength was exhibited in the utility bond group, affecting all classes. This steady improvement has resulted in bringing forward new financing, the principal issues to date being $5,000,000 Consolidated Electric Light & Power Co. of Baltimore 4s, and the $8,000,000 Ohio Edison 5s. For quite a while now the highgrade utility bond group has acted better than any other bond group with the exception of the U. S. Government bonds. This has been due to the fact that utility earnings have not fallen off like the earnings of industrials and railroads. Institutional investors have therefore relied more and more on high-grade public utility issues as investment media. The utility price index on Friday was 88.23, 86.25 last Friday and 85.23 two weeks ago. After closing the year strong in spots, the industrial list continued its rally very convincingly in the first week of the new year. The advance spread to all sections of the list in all qualities of bonds. Noticeable in particular was the uniform advance in medium-priced speculative issues and absorption of offerings of bonds representative of situations where trade developments were not the best. Greater optimism regarding treatment of American Chain 6s 1933 at maturity pushed this issue up 9 points to 69. Remington Rand 5s 1947 rallied 7 points to 51, and Purity Bakeries 5s 1948 were up several points to 65. Selling on the cigarette price cut in Tobacco Products 6s 2022 was taken well, other tobacco issues remaining firm on lighter offerings. Steels displayed better tendencies marketwise on the expectations of a better demand in that industry soon. More optimism on rubber and tires was reflected in strength in this group, U. S. Rubber 5s 1947 finishing the week at 473i. Volume of trading at a somewhat greater rate than several weeks ago seemed to denote a considerable January investmend demand existed for all types of issues. Moody's 40 industrial bond price index was 86.38 on Friday, as compared with 85.48 a week before and 84.35 two weeks ago. The very strong foreign bond market of this past week witnessed further advances in all classes of German and Austrian as well as in Argentine Government bonds. Scandinavian and Finnish obligations gave evidence of strength, while Polish issues also advanced somewhat. Japanese bonds were irregularly lower, particularly the public utility loans. Australians, Brazilians and Chileans showed fractional changes. The foreign bond yield average for Friday was 9.98%, as compared with 10.28% a week ago and 10.39% two weeks ago. Firm quotations prevailed among the best municipal issues, with new offerings in limited volume. New York City bonds were strong. Notwithstanding offers of assistance from Canadian banks and the Dominion itself, the City of Calgary, Alta, defaulted on Jan. 1 payment due in New York in U. S. dollars. The city offered to meet obligations in Canadian funds. Canadian editorial comments evidenced such strong disapproval that this action is unlikely to prove a precedent. Moody's computed bond prices and bond yield averages are shown in the tables below. MOODY'S BOND PRICES.* (Based on Average Yields.) - 80.14 79.68 78.66 78.44 78.10 103.99 103.65 103.32 103.15 102.98 78.10 78.10 78.55 78.88 79.11 79.56 79.68 79.56 79.56 79.34 79.34 79.34 79.11 79.11 78.77 78.66 78.55 78.32 78.44 78.66 78.77 102.98 102.98 102.98 103.15 102.98 103.15 103.32 103.32 102.81 102.64 102.47 102.47 102.47 102.30 102.30 101.97 101.64 101.81 101.97 101.81 101.64 79.34 80.03 79.91 79.11 80.49 81.18 80.84 81.42 82.50 82.14 80.84 81.78 81.18 80.95 80.14 76.67 72.26 70.43 66.98 64.71 62.87 82.48 63.27 63.90 63.11 00.97 59.01 62.02 63.98 66.55 68.40 69.86 68.49 87.07 71.67 74.88 75.61 77.55 76.82 74.57 74.46 72.16 72.65 72.95 74.36 74.77 82.62 57.57 93.55 62.56 102.14 102.14 101.97 101.64 101.64 101.81 101.64 101.81 102.30 101.47 100.49 100.33 99.68 99.36 98.73 96.70 95.18 94.29 93.26 91.81 90.83 90.13 90.27 90.55 90.13 89.04 86.64 89.45 92.10 93.26 93.85 94.58 92.82 92.68 94.58 98.70 96.70 97.62 95.63 94.29 93.70 91.67 91.81 92.25 93.40 93.70 103.99 85.61 106.98 87.96 69.68 92.10 90.69 89.86 89.45 89.04 Stock 89.45 88.50 87.43 87.04 86.12 Stock 86.25 86.38 86.91 87.17 87.43 87.83 87.69 87.83 87.96 87.96 88.10 87.96 87.83 87.83 87.69 87.83 87.69 87.30 87.30 87.43 87.30 Baa. RR. 79.34 61.56 71.06 78.10 60.97 70.71 77.55 60.52 70.05 77.00 60.01 69.59 Excha one Cie sed. 77.11 60.16 69.96 76.57 60.23 69.40 75.71 58.80 67.60 75.19 59.01 67.33 75.09 58.73 66.90 Excha nge Clo sed. 75.29 58.59 66.81 74.77 58.80 67.07 75.40 59.22 67.77 75.61 59.58 68.31 75.82 59.94 68.67 76.14 60.74 69.96 76.25 60.82 70.15 76.14 60.67 70.15 76.03 60.74 70.05 75.71 60.67 70.05 75.61 60.67 70.15 75.71 60.74 70.33 75.29 60.31 70.05 75.40 60.38 70.05 75.29 59.80 69.86 75.29 59.58 69.86 75.09 59.36 69.49 75.19 59.15 69.22 75.09 59.29 69.31 75.19 59.80 69.86 75.29 60.01 69.96 87.96 76.03 88.23 76.78 87.96 76.67 87.56 76.03 88.23 77.11 88.90 77.55 88.63 77.22 88.63 77.33 89.45 78.44 88.90 77.66 87.83 76.78 88.10 77.22 87.43 76.89 87.96 76.67 86.38 75.61 83.85 72.26 80.72 68.67 79.45 67.42 77.88 63.27 76.46 60.16 74.67 58.73 74.77 58.52 75.82 59.36 76.78 59.94 76.35 59.80 73.45 58.04 73.55 56.12 77.00 58.52 78.88 60.31 80.95 63.19 81.90 65.62 82.62 67.07 80.95 68.64 79.68 67.07 82.50 71.29 84.35 73.45 84.72 73.85 85.74 75.29 83.48 73.35 82.02 72.26 81.54 71.77 79.80 69.77 80.49 70.62 81.07 70.52 82.99 72.06 82.87 73.15 89.72 78.55 71.38 54.43 101.64 92.97 78.03 59.87 P. U. Indus. 88.23 87.30 87.04 86.38 86.38 86.12 85.99 85.74 86.38 86.25 85.74 85.74 85.61 85.61 85.48 84.72 84.60 84.22 85.48 85.23 85.61 85.61 85.61 85.48 85.61 85.48 85.35 85.10 84.85 84.85 84.72 84.60 84.10 83.85 83.72 83.72 83.72 83.60 83.72 84.47 84.35 84.47 84.60 84.72 84.85 84.85 84.60 84.60 84.60 84.47 84.35 83.85 83.97 83.85 83.72 83.72 83.60 83.72 83.85 83.85 60.60 70.90 84.10 84.22 61.71 71.96 84.97 84.35 61.71 72.55 84.60 83.48 60.38 71.57 83.85 82.74 62.79 73.45 85.23 83.60 63.98 74.25 86.12 83.97 63.66 73.95 85.61 83.72 64.96 74.67 86.64 83.72 66.30 76.67 87.43 83.85 66.81 76.46 86.77 83.72 64.88 74.88 85.61 82.74 67.16 76.25 86.51 83.23 66.47 76.14 85.74 82.14 65.79 76.25 85.87 81.18 65.54 76.35 84.85 79.45 61.11 71.38 81.66 77.66 54.61 65.45 77.55 74.77 51.85 64.15 75.82 72.26 47.63 59.87 73.05 69.31 45.50 56.32 72.16 67.25 43.58 54.86 69.40 85.96 43.02 54.73 69.13 65.12 43.62 55.61 69.59 66.04 44.25 56.32 70.52 66.21 43.02 55.61 69.68 65.62 41.03 52.47 68.58 63.90 38.88 49.53 66.73 63.35 41.44 52.24 71.09 65.29 42.90 54.55 72.95 66.64 45.46 57.64 74.46 79.40 47.44 59.94 75.92 70.90 49.22 62.56 76.68 71.48 47.73 60.82 74.98 71.00 45.15 59.29 71.87 71.38 50.80 64.80 77.55 73.65 65.42 70.15 80.72 74.57 56.58 71.19 81.07 74.98 69.80 73.85 83.35 76.14 58.66 72.95 81.42 73.55 57.57 71.67 79.68 72.76 58.32 71.77 79.56 72.45 55.55 69.31 77.11 70.62 55.73 70.15 77.44 70.71 55.99 70.71 77.66 70.81 57.17 72.06 80.14 71.48 57.30 72.16 81.54 71.19 67.86 78.99 87.69 85.61 37.94 47.58 65.71 62.09 78.55 95.18 96.85 90.55 42.58 53.22 73.55 63.74 79.11 68.13 50.69 64.63 79.56 66.33 93.40 105.72 100.81 92.97 77.88 94.73 95.18 90.41 Jan. 6... 5__ 4.,.. 3_ _ 2. Dec. 31_ _ 30_ 29__ 28__ 27__ 26__ 24._ 23__ 22__ 21_ 20__ 19._ 17._ 16._ 15_ 14__ 13._ 12._ 10._ 9__ 8__ 7__ 6__ 5__ 3_ _ 2__ I__ Weekly lov.25_ _ 18._ 11_ 4__ )ct. 28_ 21_. 14__ 7.. lept.30__ 23._ 16._ 9__ 2... lug. 26_ 19_ _ 12._ 5-. uly 29._ 22__ 15._ 8_ L._ une 24_ _ 17._ 10_ 3.._ lay 28.._ 21.. 14._ 7_ _ ,pr. 29_ _ 22... 15_ 8-_ I._ lar.24__ 18_ 11... 4_ _ 'eb. 28._ 19._ II__ 5-an. 29_ 22.. 15.. .ovi 1032 Ugh 1932 mv, 1931 Ilgh 1931 Yr. Agoan. 6 '32 Yrs.Aao an. 7'31 120 Domestics by Ratings. Aaa. 1 6.07 6.14 6.17 6.22 4.46 4.49 4.48 4.50 6.20 6.24 6.33 6.35 6.38 4.51 4.53 4.55 4.56 4.57 6.38 6.38 6.34 6.31 6.29 6.25 6.24 6.25 6.25 6.27 6.27 6.27 6.29 6.29 6.32 6.33 6.34 6.36 6.35 6.33 6.32 4.57 4.57 4.57 4.56 4.57 4.56 4.55 4.55 4.58 4.59 4.60 4.60 4.60 4.61 4.61 4.63 4.65 4.64 4.63 4.64 4.65 6.27 6.21 6.22 6.29 6.17 6.11 6.14 6.09 6.00 6.03 6.14 6.06 6.11 6.13 6.20 6.51 6.04 7.13 7.61 7.78 8.01 8.06 7.96 7.88 7.98 8.26 8.53 8.12 7.87 7.56 7.35 7.19 7.34 7.50 7.00 6.68 6.61 6.43 6.59 6.71 6.72 6.95 6.90 6.87 6.73 6.69 5.99 8.74 5.17 8.05 4.62 4.62 4.63 4.65 4.65 4.64 4.65 4.64 4.61 4.66 4.72 4.73 4.77 4.79 4.83 4.96 5.06 5.12 5.19 5.29 5.36 5.41 5.40 5.38 5.41 5.49 5.67 5.46 5.27 5.19 5.15 5.10 5.22 5.23 5.10 4.96 4.96 4.90 5.03 5.12 5.16 5.30 5.29 5.26 5.18 5.16 4.51 5.75 4.34 6.57 7.21 5.27 5.18 4.41 Aa. o 1.1. E je X. " 9, 13 0 • • 1 & g 1.. 4' 0 0 x / t a g :". • ,,i • 0 r •°11 ,,, .. ... ... ... ... ... ... ... ... ... .... , . — .............. , ,sEc9Ezs...........o...wwo, &....................VA....m.o......o.......o.....z . .21..,.... tytAKAr • g• . - y - cr 104.85 104.33 104.51 104.16 A. All 1932 120 Daily Domes Averages. tic. A. Baa. 120 Domestics by Groups. RR. I P. U. Indus. 40 Foreigns. 5.69 5.71 5.72 5.74 9.98 10.02 10.11 10.19 5.75 5.76 5.82 5.83 5.86 10.27 10.28 10.38 10.34 10.45 5.84 5.85 5.84 5.83 5.82 5.81 5.81 5.83 5.83 5.33 5.84 5.85 5.89 5.88 5.89 5.00 5.90 5.91 5.00 5.89 5.89 10.44 10.39 10.45 10.34 10.34 10.41 10.52 10.42 10.39 10.37 10.34 10.38 10.46 10.46 10.40 10.44 10.54 10.56 10.52 10.54 10.57 10.54 10.33 10.10 10.30 10.20 10.09 9.97 9.99 9.98 10.08 10.48 10.33 10.92 10.99 11.19 11.80 11.53 11.73 12.02 12.16 12.13 13.75 13.92 14.30 14.75 15.29 15.28 14.82 14.03 14.10 13.70 13.31 13.39 13.23 12.77 12.66 12.62 12.31 12.55 12.82 12.86 13.23 13.00 13.22 13.12 13.30 9.88 15.83 6.57 16.58 14.49 7.14 6.27 8.18 6.97 6.38 8.26 7.10 6.43 8.32 7.17 6.48 8.39 7.22 Stock Excha nge Cle 6.47 8.37 7.18 6.52 8.38 7.24 6.60 8.56 7.44 6.65 8.53 7.47 6.66 8.57 7.52 Stock Excha ngeclos 6.64 8.59 7.53 6.69 8.56 7.50 6.63 8.50 7.42 6.61 8.45 7.36 6.59 8.40 7.32 6.56 8.29 7.18 6.55 8.28 7.16 6.56 8.30 7.16 6.57 8.29 7.17 6.60 8.30 7.17 6.61 8.30 7.16 6.60 8.29 7.14 6.64 8.35 7.17 6.63 8.34 7.17 6.64 8.42 7.19 8.64 8.45 7.19 6.66 8.48 7.23 6.65 8.51 7.28 6.66 8.49 7.25 6.65 8.42 7.19 6.64 8.39 7.18 6.57 6.50 6.51 6.57 6.47 6.43 6.46 6.45 6.35 6.42 6.50 6.46 6.49 6.51 6.61 6.94 7.32 7.46 7.96 8.37 8.57 8.60 8.48 8.40 8.42 8.67 8.96 8.60 8.35 7.97 7.67 7.50 7.55 7.50 7.04 6.82 6.78 6.64 6.83 6.94 6.09 7.20 7.11 7.12 6.96 6.85 6.34 9.23 5.21 8.41 8.31 8.16 8.16 8.34 8.02 7.87 7.91 7.75 7.59 7.53 7.76 7.49 7.57 7.65 7.68 8.24 9.20 9.67 10.48 10.94 11.39 11.53 11.38 11.23 11.63 12.05 12.67 11.94 11.56 10.95 10.52 10.16 10.46 11.02 9.86 9.07 8.89 8.42 8.58 8.74 8.63 9.05 9.02 8.98 8.80 8.78 7.41 12.96 8.34 11.64 7.08 6.97 6.91 7.01 6.82 6.74 6.77 6.70 6.51 6.53 6.68 6.55 6.56 6.55 6.54 7.03 7.69 7.85 8.41 8.93 9.16 9.18 9.04 8.93 9.04 9.58 10.10 9.60 9.21 8.73 8.40 8.05 8.28 8.49 7.77 7.16 7.05 6.78 6.87 7.00 6.99 7.25 7.16 7.10 6.06 6.95 6.30 10.49 5.06 9.43 5.86 5.85 5.92 5.98 5.91 5.88 5.90 5.90 5.89 5.90 5.98 5.94 6.03 6.11 6.26 6.42 6.69 6.94 7.25 7.48 7.26 7.73 7.62 7.60 7.67 7.88 7.95 7.71 7.55 7.24 7.08 7.02 7.07 7.03 6.80 6.71 6.67 6.56 6.81 6.89 6.92 7.11 7.10 7.09 7.02 7.05 5.75 8.11 5.38 7.00 7.33 9.88 7.79 7.58 5.21 6.40 5.09 0 81.66 80.84 80.49 79.91 Au. 120 Domestics by Groups. N Aaa. 120 Domestics by Rat ngs. MOODY'S BOND YIELD AVERAGES•t (Based on Individual Closing Prices.) MO(.1.00.000 . ..p0ONNN.N..0°N•,.9CROM0NCIN0.. All 120 Domes tie. Jan. 7 1933 .000 1932 Daily Averages. a.0 oo.vamommom00000momoop000mmomoomompoaaaa000000000.o 00000000000000000000. 00000 0000 OeO.b666666i6 taawo,w 4a . vo,taa.,..aca o. :aO a.4L, .O 000wo.omwoonw000. -au oz., Financial Chronicle 22 5.39 Note.-These prices are computed from average yields on the basis of one "idea" bond (414% 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 illustrate in a more Comprehensive way the relative levels and the relative move. ment of yield averages, the latter being the truer picture of the bond market. t The hot complete list of bonds used In computing these Indexes was published In the "Chronicle" on Oct. 1 1932. page 2228. For Meody's Index of bond prices by months back to 1928, refer to the "Chronicle" of Feb.6 1932, page 907. Indications of Business Activity THE STATE OF TRADE-COMMERCIAL EPITOME. Wheat has been particularly under the influence of tho proposed Domestic Allotment bill, but even so its world staFriday Night, Jan. 6 1933. Trade during the first week of the now year has con- tistical position is strong and receipts at the West have tinued quiet, but general sentiment is improving, and the dropped materially. Corn and cotton receipts have done downward drift appears to have been stopped pretty def- the same thing. Cotton exports have increased. Holders initely. Inventories, which have not been large for a long of grain and cotton are unwilling sellers at the present low time, are becoming notoriously small and will need replenish- prices and the belief that Allotment legislation will soon be ment before long. One very encouraging factor is the in- passed providing some form of price guaranty is a direct creasing strength and activity in the securities and com- invitation to the farmer to hold such products as will be modities markets. In the latter instance, this change may be covered by it. There is a strong belief that such a bill, largely due to tho prospect of inflationary legislation which passed during this session of Congress, would receive the seems almost sure to come, but stocks and bonds are in a Presidential veto, but inflationary legislation of some sort, somewhat different position. Without attempting to maxi- designed to help the agriculturist will in all likelihood be mize the importance of Wall Street's influence on the country enacted shortly after the new Congress meets. Some foreign at large, the fact remains that a steadily advancing securities buying of our wheat, rye and cotton has already been atmarket is bound to have a heartening effect upon the average tributed to the prospect of it. International debts have individual if kept up for an appreciable length of time. ceased to have a direct influence for the time being and the Practically all commodities have advanced during the week Democratic taxation program is beginning to formulate itself. with most of them reaching their highest prices to-day. As to general trade in New York after the holiday trading, Volume 136 Financial Chronicle many retail stores reduced prices markedly in special sales. In Chicago wholesalers reported increased activity in cotton goods, silks, wash dresses, gloves and other spring apparel. Steel output in that district was around 10%, with producers hopeful of better buying by railroads and implements makers in the near future. In St. Louis a slight increase in car loadings was reported as compared with last year. Wholesale houses there were taking inventories and in most cases were optimistic, but the industrial situation showed no actual improvement and collections were still slow. In Cleveland shoe factories are busy on spring models after sales in December which were somewhat larger than in December 1931. Steel production for the week at Cleveland averaged 17%, with Pittsburgh reported at 14 and Youngstown at 13. In Minneapolis year-end dullness was more pronounced than usual, especially in the retail trade, with wholesale business mostly confined to "filling in" orders. On the other hand, food lines were selling well, the flour trade at Minneapolis was better, and the trade in confectionery was good. In San Francisco most large stores cut prices sharply; some big corporations declared dividends, while others submitted plans for reorganization. A coal price "war" led to a very sharp reduction in prices. Boston post-holiday retail trade was larger at marked-down special sales and inventories as a rule are the smallest for years past. Shoe factories there were somewhat busier and some are producing spring goods, though the outlook for prices is considered rather uncertain. In recent months woolen and worsted goods have received pretty good orders, but they have bought wool sparingly with a view of keeping down their inventories. The jewelry trade of Boston, as seemingly in most other cities, has been dull and new building contracts have been dwindling. In Philadelphia clearance sales at retail have led to a fair business and merchants have made efforts to induce people to open accounts in some cases by permitting December bills to be paid in February. Inventories of all kinds of merchandise are small. Most textile plants are preparing for a good spring trade. The outlook in the leather trade at Philadelphia is also considered good but in silks the present volume is said to be 30% below that of last year. In spite of the recent cut in the price of some of the leading brands of cigarettes, the tobacco trade is doing well. Rayon plants all over the country are reported to be operating overtime. Pig iron has been dull and apparently weaker for Eastern Pennsylvania iron in the New England district. Steel has been in the main dull and prices, it is believed, will soon be subjected to a real test, possibly disclosing new weakness but also possibly opening the way to larger business and a real market as contrasted with a more or less nominal one for so long a period. Latterly production has been slowly gaining due principally to buying by the motor industry. As to the stock market,stocks on Dec.31 fluctuated within very narrow bounds ending at an irregular decline with sales of 539,400 shares. In sharp contrast with this rather disappointing exhibit in stocks, bonds were active and higher with transactions of $5,550,000. U. S. Government issues as a rule were 1-32 to 5-32 points higher. German bonds continued to rise, French advanced and Argentine rallied well. Many domestic corporation bonds rose 1 to 6 points. London was closed but Berlin and Paris were higher. Berlin was encouraged by the steady rise of German bonds in New York. On the 3d stocks were dull and irregularly lower with trading in only 489,000 shares, or the slowest market in about six months. Bonds were dull and irregular with transactions down to $8,510,000, a disappointing showing for a full day. In German Government bonds there was a rise of 1% to 14 points and German municipal and corporation issues were up 5 and 6 points. Other foreign issues rose, including Argentine, Belgian, Hungarian, Brazilian and Austrian. In fact one of the Austrian Government issues was as much as 8 points higher. Sterling advanced y, cents and francs were slightly higher. On the 4th, stocks advanced 2 to 5 points with trading in 1,093,088 shares, or more than double that of the previous day. The aggressive buying of and rising prices for bonds supplied the backbone to stocks. The bond trading was $12,778,000. Also wheat was up to 13c. and cotton 20 to 25 points. Rising talk in Washington of the possibility of some form of inflation had some influence. Some of the railroad traffic reports were encouraging. German 53's were up to a new high and other German bonds, state, municipal and corporation, were noticeably strong. Eleven United States Government issues sold above their highs for 23 /8 were above par for the first time 1932 and Treasury 31 in more than a year. Of domestic corporation bonds, railroad and utility issues were 1 to 5 points higher. Lowpriced bonds also came in for more attention. On the 5th, stocks advanced 1 to 4 points, with railroad shares leading, but later under profit-taking, reacted and closed at an irregular, and so far as the more popular issues were concerned, a trifling decline. The sales were 1,143,905 shares. Bonds remained strong for domestic, corporation and foreign issues. United States Government bonds were irregular and the total sales were $12,609,000. The news of former President Coolidge's death was a shock to the financial community. To-day stocks closed in quite bouyant fashion, at nearly the best prices of the session. Sales totaled 1,141,910 shares and advances ranged in the more active issues from fractions up to 2 points or in a few cases, even more. Bullish sentiment was on the increase and the market was undisturbed by the selling of those who did not care to hood their position over another double holiday. The grain and most commodity markets showed substantial advances,with the exception of cotton, which was about unchanged, wheat was very strong. The conference between the Democratic Congressional leaders and President-elect Roosevelt was generally interpreted by Wall Street as constructive and the measures proposed to balance the budget were not considered unacceptable even though an extra session of Congress is almost inevitable. —rerrweek-end trade reviews were conservatively hopeful with general stress being laid on the fact that industrial trends are upward rather than downward as at the end of 1931. The bond market continued its upswing with the strength emphasized in the higher grade issues. German, South American and Norwegian bonds were generally higher. The advance in the domestic list was led by the better class rails and public utilities. Some of these issues are now selling on a 4% basis. U. S. Governments made a number of new highs on the announcement by the Federal Reserve that it would retain substantially all of its government holdings. Estimated sales were $10,500,000. To-morrow all Stock Exchanges will be closed in memory of ex-President Coolidge. At Syracuse, N. Y.,the Crown Woolen Mills are operating overtime. At Lawrence, Mass., between 5,000 and 7,000 workers are employed in the Wood Worsted Mills and in some parts the plant is running practically 24 hours. The Ayer, Arlington and Pacific Mills are also working day and night. The textile talk in Lawrence is optimistic. At Lowell, Mass., on the 4th the Suffolk Knitting Co. to-day resumed operations after a two weeks' shut-down, giving employment to 600 operatives. Officials of the company said that they found it almost impossible to keep up with the orders on hand and that the knitting department was working day and night shifts. At Gastonia, N. C., the Osceola Mill, a plant of Textiles, Inc., began operations on a full-time schedule this week after being on a curtailed schedule for several months. Eighty per cent of the machinery was put into operation. At Lindale, Ga., the Pepperell Manufacturing Co., Lindale plant, has orders in sight which will insure full-time operations for at least four months. The mill manufactures denims, ehambrays and canton flannels and has 114,088 spindles and a battery of 3,170 looms. Chickamauga, Ga., wired that the Crystal Springs Bleachery is operating on a full-time schedule from early Monday through Saturday of each week, using three shifts of eight hours each. On Dec. 31st the temperatures in New York were 34 to 61 degrees with some rain. It grew colder by nightfall and at 10 p.m. was down to 34. In Boston it was 50 to 64, in St. Paul 2 below to 10 above, in Winnipeg 18 below to 14 above, in St. Louis 20 to 26, in Philadelphia 55 to 60, in Milwaukee 14 to 18 and in Chicago 20. On Dec. 30 it was 102 and very humid,in Buenos Aires, the highest in 2 years; it has been only 68 on Christmas Day. It was colder here on the 1st with temperatures of 14 to 30. Chicago had 16 to 30, Cincinnati 18 to 34, Detroit 10 to 30, Milwaukee 12 to 34, St. Paul 14 to 34, Omaha 28 to 42, Philadelphia 16 to 30, San Francisco 42 to 54. At Fairbanks, Alaska, it was 44 below zero. Floods still prevailed. In parts of Mississippi, Alabama, Arkansas and other parts of the South, many inhabitants being obliged to leave their homes. On the 2d it was 28 to 41 in New York. A 60 mile gale swept the coasts of England and Ireland with high winds in London and other British cities. There was a disastrous overflow of the Guadalguiver River in Spain. Mexico had the second Financial Chronicle 24 cold wave of the winter. At Mexico City it was down to 25 degrees. On the 4th it was unseasonably warm here for January the temperatures being 41 to 54. Boston had as high as 60. In Chicago it was 36 to 40; in Detroit, 38 to 44; in Kansas City, 34 to 48; in Minneapolis, 14 to 36; in St. Louis, 44 to 52; in Winnipeg, 14 below to 4 above. On the 5th it was a little colder here, but pleasant. To-day it was 34 to 48, with the forecast for fair and warmer to-night and to-morrow. Overnight Boston had 34 to 50 degrees; Pittsburgh, 34 to 42; Portland, Me., 24 to 46; Chicago, 32 to 42; Cincinnati, 36 to 48; Cleveland, 34 to 42; Detroit, 32 to 40; New Orleans, 62 to 74; Tampa, 56 to 70; Kansas City, 40 to 54; St. Paul,30 to 36; St. Louis, 40 to 54; Denver, 30 to 54; Salt Lake City, 24 to 40; Los Angeles, 54 to 76; Portland, Ore., 42 to 54; San Francisco, 42 to 52, and Winnipeg, 10 to 24 degrees. New York Federal Reserve Bank's Indexes of Business Activity. In presenting in its January "Monthly Review" its indexes of business activity the Federal Reserve Bank of New York says: Data now available for December indicate that some decline in general business activity and trade occurred during the month. The movement of miscellaneous and less than carload freight over the railroads was reduced by somewhat more than the usual seasonal amount. The holiday trade In department scores in the New York Metropolitan area from Dec. 1 to Dec. 24 showed about the same decline from a year ago as the average for the previous 11 months, but apparently the increase over November was not quite as large as usual. On the other hand, the production of electric power increased about as usual from November to December, and the number of business failures showed little change other than the customary seasonal rise. In November, moderate declines were indicated in most of this bank's indexes of the distribution of goods and general business activity, including the indexes representing movement of railroad freight, sales of department stores and chain stores, volume of check payments, and merchandise exports. Favorable movements were recorded, however, in the indexes of business failures, life Insurance sales, and merchandise exports, and electric power production was unchanged from October to November. (Adjusted for seasonal variations, for usual year-to-year growth, and where necessary for price changes. Primary DistributionDar loadings, merchandise and miscellaneous- __ Car loadings, other Exports Imports Waterways traffic Wholesale trade Distribution to ConsumerDepartment store sales, Second District Chain grocery sales Other chain store sales Mall-order house sales Advertising Gasoline consumption Passenger automobile registrations General Business ActivityBank debits, outside of New York City Bank debits, New York City Velocity of bank deposits, outside of N. Y. City Velocity of bank deposits, New York City Shares sold on New York Stock Exchange Life insurance paid for Electric power Employment in the United States Business failures Building contracts New corporations formed In New York State_ Real estate transfers General price level • Composite index of wages • Cost of living. p Preliminary. •1913 average100. Nov. 1931. Sept. 1932. Oct. 1932. Nov. 1932. 66 60 57 75 48 84 52 48 44 50 37 86 55 53 47 54 41 78 53 53 439 569 42 75 89 80 82 69 70 79 41 75 70 76 69 57 69 299 76 68 76 67 55 67 239 72 64 70 62 54 57 53 74 54 71 80 679 02 110 25 78 49 131 176p 129 54 42 67 39 53 82 679 63 95 30 79 40 130 1779 127 70 56 81 62 94 100 79 71 107 41 85 51 144 199 144 60 62 76 65 179 82 68 62 119 28 94 44 132 179 130 Index of Wholesale Prices of National Fertilizer Association Unchanged During Week Ended Dec. 31Remains at Record Low Point of 58.1. Although the number of commodities that showed price losses during the latest week were twice as numerous as the number of advancing commodities, there was no change in the general index of the National Fertilizer Association wholesale price index for the week ended Dec. 31. The latest index number, 58.1, is 12 points lower than it was two weeks ago and 19 points lower than it was at the first of December. The index at present stands at a record low point. A year ago the index stood at 65.1, or about 70 fractional points higher than at Dec. 31 1932. Two years ago the index stood at 79.3. The decline during the latest year has been the smallest during the almost constant decline of wholesale prices since the last part of 1929. (The three year average, 1926-1928 equals 100.) Under date of Jan. 3 the Association also reported the following: While three of the 14 groups listed in the index advanced during the latest week, two declined and nine were unchanged. Neither the advancing nor declining groups were materially affected. The largest loss was shown In the group of grains, feeds and livestock while textiles showed the to slightly more than six cents at Southern best gain. Raw cotton moved up Jan. 7 1933 markets Foods and fats and oils advanced slightly. Building materials declined fractionally. During the latest week there were 28 commodity price declines and 13 advances. During the preceding week there were 32 price losses and 15 price gains. The price losses, however, during the latest week were very much smaller than for the preceding week. A representative list of commodities that declined during the latest week included lard, tallow, raw sugar, flour, white corn, wheat, hogs, lambs, white lead paint, turpentine, rubber, wool, silk, and calfskins. Advances were shown for cotton, cottonseed oil, butter, linseed oil, eggs, white potatoes, apples, cattle and rosin. WEEKLY WHOLESALE PRIC E INDEX-BASED ON 478 COMMODITY PRICES (1926-1928=100). Per Cent Each Group Bears to the Total Indez. 23.2 16.0 12.8 10.1 8.5 6.7 6.6 6.2 4.0 3.8 1.0 .4 .4 .3 inn n Group, Latest 1Veek Dec 31 1932. Pr.ceding Week. Month Ago, Year Ago. Foods Fuel Grains, feeds and livestock._ _ Textiles Miscellaneous commodities_ _ Automobiles Building materials Metals House-furnishing goods Fats and oils Chemicals and drags Fertilizer materials Mixed fertilizer Agricultural implements_ _ 58.7 58.6 34.4 42.9 60.6 86.6 70.6 67.8 77.4 46.0 87.3 61.7 67.9 91.8 58.6 58.6 35.3 42.4 60.6 86.6 70.7 67.6 77.4 45.7 87.3 61.7 67.9 91.8 61.0 63.4 37.3 43.2 61.5 86.6 70.6 67.8 77.4 47.1 87.3 62.2 87.9 91.9 68.4 58.7 51.1 49.7 66.6 89.1 73.3 73.6 84.3 53.2 88.9 70.3 79.6 92.7 58.1 58.1 60.0 65.1 An ormma enmhInerl National City Bank of New York Sees Ground for Business Recovery Laid in Past Six Months. According to the National City Bank of New York (we quote from its January monthly review) "it may be considered that in the past six months a ground for business recovery has been laid that had not existed hitherto in the depression." The bank continues: Taking the period in its entirety its outstanding characteristics have been these: 1. The contraction of credit has been halted, and the volume outstanding Is larger at the end of the period than at the beginning. The financial situation has improved steadily since early summer, and the growth of confidence In the country's money and in the general solvency of the banking System has relieved the pressure on credit and thus removed one of the causes of deflation. Funds have piled up in the centers, available to business when trade relationships are restored. 2. The decline in business activity has been stopped, and the level Is higher at the end than at the beginning. The third quarter was a period of improvement and marked gains In activity, and the recession during the final quarter has been moderate in most particulars, not materially exceeding the seasonal expectation. 3. The decline in prices was stopped, and despite subsequent reactions, stocks and bonds hold well above bottom, while commodities are but little under the June blow. 4. The piling up of commodity stocks has been checked. Although in the raw materials the improvement is not very substantial, stocks of manufactured goods in all lines are conspicuously low, and much below a year ago. The small stocks of automobiles in dealers' hands are an example. This is the first half-year period since the beginning of the depression of which the foregoing could be said. Every other half-year has been one of deterioration in some or all of the factors cited. Obviously is is of great importance that the deterioration of business In these respects has been stopped for as long a time as six months. This creates a basis of stability heretofore lacking, and the history of past severe depressions supports the idea that this is a necessary and usual precedent to improvement. It is worth remarking that the month of December, which in both 1930 and 1931 was a period of almost complete demoralization due to the efforts to establish losses and reduce inventories before the yearend, has been this year a month of stability in most markets. Moreover, such indexes of general business conditions as railway car loadings and electric power production have shown during the month a smaller percentage of decline below 1931 than at any time since last Spring. The question is sometimes asked whether there is any such thing as a minimum of replacement requirements upon which business activity may find bottom. The rebound since last summer, and the mainly seasonal character of the recession from the October peak, suggest that this may be the case. Even in the worst breakdown of trade relations ever known, ways are being found to supply the minimum needs of food, clothing and shelter, and In the most difficult situation ever faced there are still companies which have been able to put their affairs In shape to do business at a continuing profit. This Is a hopeful augury against further decline, and undoubtedly a continuation of the present period of stability In trade even upon the low level would extend to prices, generate confidence and promote investment and business enterprise. Freight Car Loadings in First Quarter of 1933 Estimated at 4% Below Same Quarter in 1932-Increase in Three Regions Expected in Present Quarter as Compared With Last Year. Freight car loading in the first quarter of 1933 will be 4% less than the actual loadings in the same quarter of 1932, according to estimates compiled by the 13 Shippers' Advisory Boards and made public Jan. 3, based on replies of approximately 20,000 shippers to a questionnaire sent out by the Boards each quarter. This estimate, says the American Railway Association, is significant because the same shippers estimated late last September that loadings in the fourth quarter (October, November and December) of 1932 would be 10.4% under the actual loadings for the fourth quarter the preceding year. Under date of Jan. 3 the Association also said: In the estimates Just completed, shippers located In three regions-Great Lakes, Ohlo Valley and the Southwest-expect an Increase in car loadings In the first quarter of 1933 compared with the same period in 1932. In the first named region, the Great Lakes, it is estimated there will be an increase of 4.8%, while an increase of 6.1% is expected in the Ohio Valley and an increase of 1.5% in the Southwest Region. Each of the 13 Shippers Advisory Beards prepares car loading estimates covering 29 principal commodities, which constitute over 90% of the total car load traffic. The tabulation below shows the total loadings for each district for the first quarter of 1932, the estimated loadings for the first quarter of 1933 and the percentage of increase or decrease. Actual Loadings 1932. Shippers' Advisory Board. Allegheny Atlantis States Central West Great Lakes Mid-West New England Northwest Ohio Valley Pacific Coast Pacific Northwest Southeast Southwest Trans-Missouri-Kansas Total Estimated Per Cent of Loadings Increase or 1933. Decrease. 551,657 479,684 206,448 215,361 744,461 117.353 134,899 488,836 143,624 105.940 402.508 310,039 268,506 497,379 470,473 183.233 225,665 689,936 108.600 131,294 518.638 129.130 99,635 398,145 311,646 241,729 -9.8 -1.9 -11.2 +4.8 -7.3 -10.0 -2.7 +6.1 -10.1 -6.0 -1.1 +.5 -10.0 4,169,316 4.002,503 -4.0 Of the 29 commodities covered.in the forecast, it is anticipated that five will show an increase in loadings in the first quarter of 1933 compared with the same period in 1932. They are Cotton; citrus fruits; sugar, syrup and molasses; automobiles, trucks and parts; and chemical and explosives. The largest increase, according to the estimates, is for automobiles, trucks and parts, for which an increase of 18.9% is expected. Estimates as to loadings of citrus fruits in the first quarter of 1933 compared with the same period In 1932, amount to 16.4%, while for cotton an increase of 11.6% is anticipated. The percentage of decreases estimated for the other 24 commodities range from 3.7% for flour, meal and other mill products to 15.2% for hay, straw and alfalfa; 16.9% for ore and concentrates, and 22.5% for agricultural implements and vehicles other than automobiles. The estimated car loadings for the first quarter of 1933, together with the actual car loadings for the same period in 1932 and the percentages of Increase or decrease, are shown as follows for each of the 29 commodities Included in the forecast of the Shippers' Advisory Boards: Car Loadings. Estimated Per Cent. Commodity. Actual. 1932. Grain, all 213.195 Flour, meal & other mill products 175,293 Hay, straw and alfalfa 48,141 Cotton 51,000 Cotton seed dc products, except oil_ 30.713 Citrus fruits 40,361 Other fresh fruits 32.905 Potatoes 62.629 64,231 Other fresh vegetables Live stock 232.819 Poultry and dairy products 31,205 Coal and coke 1,736,227 40,470 Ore and concentrates Gravel, sand and stone 142,689 25,328 Salt 261,013 Lumber and forest products 414,902 Petroleum and petroleum products_ Syrup,syrup and molasses 27.079 Iron and steel 178,233 Machinery and boilers 17,541 Cement 44,985 Brick and clay products 36,204 Lime and plaster 21,236 Agricultural implements & vehicles, other than automobiles 7,286 Automobiles,trucks and parts 66,367 Fertilizers, all kinds 52,398 Paper, paper bd.& prepared roofing 65,641 Chemicals and explosives 15,349 Canned goods-All canned food products (includes catsup. Jams. Jellies, olives, pickles, preserves, ' dm.) 33,876 Total all commodities listed 4.169.316 Estimated 1933. Increase % Decrease. % 3.9 204,823 --168,751 -3.7 40.80015.2 56,915 1-1.:6 28,08311-.8 11".:i 46.973 -. 13.4 30,808 --7.0 58.238 --11.6 56.810 ---_ 7.8 214,560 29,168 6.5 --2.3 1,696,275 --16.9 33,647 --4.3 136.541 _-_ 24,714 ___ 2.4 244.224 _-_ 6.4 393,586__ 5.1 -2.I5 27,862 -9.2 161,878 --16.4 14,847 --5.1 42,698 --12.7 31,620 --19.181 --9.7 5,64922.5 18.9 78,928 .7.2 48,620 --59,809 --8.9 .5 15,419 --- 31,076 --- 8.3 4.002.503 ___ 4.0 Effect of Economic Conditions on Railroads in 1932Loading of Freight Lowest for Any Year Since Tabulations Were Begun in 1918-R. H. Aishton Holds It Essential That All Agencies of Transportation Be Given Equal Opportunity to Compete. In a statement issued Jan. 2, R. H. Aishton, President of the American Railway Association and Chairman of the Association of Railway Executives, points out that the "continuation of the economic depression has enlarged and intensified the problems of the railroads of this country." Mr. Aishton further states that "prospects for rail traffic and revenues in the year 1933 depend in the main on the up trend of general business conditions. "The degree to which competition by the unregulated commercial carriers operating for hire over the public highways and by water continue to grow will also have an important bearing," he says, adding: Any stimulation in business activity will almost at once be reflected in Increased rail traffic and earnings, but if the railroads are to continue to meet adequately and efficiently, as they have been doing the commercial needs of the nation, It is essential that all agencies of transportation be even an equal opportunity to compete on a fair and equitable basis. From Mr. Aishton's statement we also quote: In the matter of both traffic and earnings, the year 1932 has been as great a disappointment to the railways as to other lines of industrial effort. Preliminary reports, from the railways, which will not become complete for several weeks, indicate that loading of revenue freight in 1932 will total 28,100.000 cars, the lowest for any year since the tabulation of these reports began in 1918, and a reduction of 9.053,100 cars or 24.4% under the total for 1931. 25 Financial Chronicle Volume 136 Measured in net ton miles, the volume of freight handled in 1932 will be, complete reports are expected to show. 257.000.000,000 net ton miles. which was lower than for any year since 1909, and a reduction of 24.4% under 1931. Preliminary reports for the year show that the Class I railroads as a whole had a net railway operating income in 1932 of 5324.000.000 or a return of 1.21% on their property investment. Class I railroads in 1931 had a net railway operating income of $531,000,000. which was a return of 1.98% on their property investment. Gross operating revenues in 1932 amounted to approximately $3,150,000,000. a decrease of 25.6% under those for 1931, while operating expenses amounted to $2,419.000.000. a decrease of 25.9% under the previous year. Net income, after fixed charges, disappeared in the railway industry in 1932. For the carriers as a whole, the aggregate net deficit was close to $200,000,000. Some companies more than earned their interest and fixed charges during the year but more than 80% of the mileage failed to do so. It is obvious that the railroads of the country, like nearly all other kinds of business, have suffered a severe depletion of revenues due to lack of business. The estimate of earnings for the 12 months of 1932 is based on complete reports for the first ten months and an estimate by the Bureau of Railway Economics as to earnings in November and December. The net railway operating income cor the ten months period totaled $266,295,000. compared with $473,539.000 for the corresponding period in 1931. Passenger traffic in 1932 was less than for any year since 1900, amounting to 16,775.000.000 passenger miles. This was a reduction of 64.2% under the record year of 1920. Loading of Railroad Revenue Freight Continues Small. Loading of revenue freight for the week ended on Dec. 24 totaled 494,580 cars, according to reports filed on Jan. 3 by the railroads with the Car Service Division of the American Railway Association. This was a decrease of 22,216 cars under the preceding week but an increase of 53,681 cars above the same week in 1931. It was, however, a reduction of 41,712 cars under the same week in 1930. In making comparisons with the same weeks in 1931 and 1930 consideration must be given to the fact that the same weeks in the two preceding years included Christmas holiday. Particulars are outlined as follows: Miscellaneous freight loading for the week ended Dec.24 totaled 138.329. a decrease of 10,053 cars below the preceding week, 6,884 cars under the corresponding week in 1931 and 36,869 cars under the same week in 1930. Coal loading totaled 140,836 cars, a decrease of 3.922 cars under the Preceding week but 51,192 cars above the corresponding week in 1931 and 23,379 cars above the same week in 1930. Coke loading amounted to 6,609 cars, a decrease of 62 cars below the preceding week but 2,248 cars above the same week in 1931, compared with the same week in 1930,it was a reduction of 1.029 cars. Loading of merchandise less than carload lot freight totaled 154.613 cars. a decrease of 5,499 cars under the preceding week but 4.172 cars above the corresponding week in 1931. The total for the week of Dec. 24, however. was 12,118 cars below the same week in 1930. Live stock loading amounted to 14,264 cars, a decrease of 2.909 cars below the preceding week but 833 cars above the same week in 1931. It was, however,a reduction of 3,361 cars below the same week in 1930. In the Western districts alone, loading of live stock for the week ended on Dec. 24 totaled 10,879 cars, an increase of 731 compared with the same week in 1931. Grain and grain products loading totaled 25.370 cars, 219 cars below the Preceding week. but 4,856 cars above the corresponding week in 1931. Compared with the same week in 1930, it was a decrease of 1,297 cars. In the Western districts alone,grain and grain products loading for the week ended on Dec. 24 totaled 16,187 cars, an increase of 3,059 cars above the same week in 1931. Forest products loading totaled 12,656 cars, an increase of 667 cars above the preceding week, but 1,034 cars under the same week in 1931 and 8.039 cars below the corresponding week in 1930. Ore loading amounted to 1.903 cars, a decrease of 219 cars under the week before. 1,702 cars below the corresponding week in 1931 ans 2.378 cars under the same week in 1930. All districts, except the Southwestern, which showed a small decrease, reported increases in the total loading of all commodities compared with the same week in 1931 but all districts reported reductions compared with the same week in 1930 except the Pocohontas which showed an increase. Loading of revenue freight in 1932 compared with the two previous years follows: 1932. Four weeks in January Four weeks In February Four weeks In March Five weeks in April Four weeks In May Four weeks in June five weeks In July Four weeks In August Four weeks In September five weeks In October Four weeks in November Week ended Dec 3 Week ended Dec. 10 Week ended Dec. 17 Week ended Dec. 24 Total 1931. 1930. 2,269,875 2,245,325 2,280,672 2,772,888 2,087,756 1.966,355 2,422,134 2,065,079 2,244,599 3,158,104 2,195.209 547,461 521,216 516,706 494,580 2.873,211 2,834,119 2,936,928 3,757,863 2,958,784 2,991,950 3,692,362 2,990,507 2,908,271 3,813.162 2,619.309 636.366 613,621 581,170 440.899 3,470,797 3,506.899 3,515,733 4,561.634 3,650,775 3,718,983 4,475.391 3,762,048 3,725.686 4,751.349 3,191,342 787,072 744,353 713,865 536.292 27.788.049 36.648.522 45.102.219 The foregoing, as noted, covers total loadings by the railroads of the United States for the week ended Dec. 24. In the table below we undertake to show also the loadings for the separate roads and systems. It should be understood, however, that in this case the figures are a week behind those of the general totals-that is, are for the week ended Dec. 17. During the latter period a total of 30 roads showed increases over the corresponding week last year, the most important of which were the Chesapeake & Ohio Ry., the Norfolk & Western Ry., the Louisville & Nashville RR., the Erie RR., the Delaware, Lackawanna & Western Ry., the Lehigh Valley RR., and the Delaware & Hudson Co. Financial Chronicle 26 Jan. 7 1933 REVENUE FREIGHT LOADED AND RECEIVED FROM CONNECTIONS (NUMBER OF CARS)-WEEK ENDED DEC. 17. Total Revenue Freight Loaded. Railroads. 1931. 1930. 1932. 1931. 1,432 2,788 7,014 546 2,215 9,689 523 1.636 3.283 8,190 619 2,665 11,358 535 1,749 3,617 9,330 784 3,621 12,537 551 208 4,044 8,274 1,800 1,847 10,057 755 270 5,184 10,147 '2,495 2,215 12,223 1,009 24,207 28,286 32,189 26,985 33,543 sTiiii 8,443 11,593 134 1,366 8,128 1,683 17,710 2,131 404 274 4:836 7,822 10,792 130 1,427 7,544 1,545 19,024 2,085 460 349 iiii 10,069 13,291 165 1,806 9.290 2.047 23,737 1,246 666 424 5:461 4.615 11,238 1,671 744 5,804 29 22,591 1,943 35 203 6:843 5,794 12,149 1,888 928 6,579 29 25,404 1,910 23 205 57,086 56,014 70,655 54,334 61,752 371 1,415 7,574 12 202 204 969 2,389 4,961 3,272 3,490 4,240 2,748 1.091 4.543 2,672 551 1,652 8,168 39 195 251 1,158 2,831 5,414 3,872 4,247 4,257 3,040 815 5.223 2,503 471 2,013 9.707 64 288 200 1,674 3,336 6.370 4,783 4,693 3.871 4,316 1,281 5,961 2,783 800 1,577 10,347 30 70 2,432 892 5,217 7,505 150 7,701 4,242 3,066 548 6.929 1,490 982 1,762 10,164 72 98 2.578 1,266 6,546 8,599 157 7,934 4.338 4,479 635 7,006 1,918 40,153 44,216 51,811 53,896 58,534 121,446 128,516 154,655 135,215 153,829 22,532 575 25,750 923 z32,413 1,286 10,902 529 12,807 936 -iiS 5,242 1 264 243 865 49,333 11,436 3,338 55 2,646 155 5,897 39 400 215 1,205 59,222 13.233 5,217 67 2,991 247 8,147 2 547 163 1,425 70.016 16,346 8,322 78 3,642 5 8,484 34 24 9 2.289 27,598 12,523 676 1 2,977 8 10,574 64 19 17 3,337 32.158 16,336 1,117 2 4,121 96,765 115,298 142.634 66,051 81,496 20,620 15,527 566 3.588 18,134 14,805 684 3,043 22,080 17,561 711 3,908 5,731 2,965 1,010 439 4,970 3,119 1,269 313 40,301 36,666 44.260 10,145 9,671 7,309 788 304 119 49 *1,316 390 256 6,143 16,581 138 9,029 1,144 407 146 58 1,697 506 369 7,611 19,516 170 10,994 1,360 542 182 79 2,031 485 391 9.225 23,309 175 3,541 1,242 674 275 53 895 596 3,029 2,719 9,274 520 4,283 1,089 692 307 85 1,067 768 3,937 3,211 10,805 828 33,393 40,653 48.773 22,818 27,052 1932. Eastern DistrictGroup A: Bangor & Aroostook Boston & Albany Boston & MaIne Central Vermont Maine Central New York N. H. & Hartford_ _ Rutland Total Group B: y Buff. Rochester & Pittsburgh Delaware Sr Hudson Delaware Lackawanna & west_ Erie Lehigh dr Hudson River Lehigh & New England Lehigh Valley Montour New York Central New York Ontario & Western Pittsburgh & Shawmut Pitts. Shawmut & Northern Ulster & Delaware Total Group C: Ann Arbor Chicago Ind. & Louisville Cleve. CM. Chic. & St. Louis Central Indiana Detroit & Mackinac Detroit & Toledo Shore Line_ Detroit Toledo & Ironton Grand Trunk Western Michigan Central Monongahela New York Chicago & St. Louts_ Pere Marquette Pittsburgh & Lake Erie Pittsburgh dr West Virginia Wabash Wheeling dr Lake Erie Total Grand total Eastern District_ Allettheny DistrictBaltimore dr Ohio Bessemer & Lake Erie y Buffalo & Susquehanna Buffalo Creek & Gauley Central RR. of New Jersey___ _ Cornwall Cumberland & Pennsylvania___ Ligonier Valley Long Island Pennsylvania System Reading Co Union (Pittsburgh) West Virginia Northern Western Maryland Total Pocahontas DistrictChesapeake & Ohio Norfolk & Western Norfolk & Portsmouth Belt Line Virginian Total Southern DistrictGroup A: Atlantic Coast Line Clinchfield Charleston dr Western Carolina. Durham & Southern Gainesville dr Midland Norfolk Southern Piedmont & Northern Richmond Frederick. dr Potorn. Seaboard Air Line Southern System Winston-Salem Southbound Total Total Loads Received from Connections. Total Revenue Freight Loaded. Railroads. Group It: Alabama Tenn.& Northern__ -Atlanta Birmingham & Coast__ Atl. & 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 Mississippi Central Mobile & Ohio Nashville Chatt. & St. LouLs_ -New Orleans-Great Northern... Tennessee Central Total Loads Received from Connections. 1932, 1931. 1930. 136 539 472 2,596 172 817 601 228 526 18,475 17,190 111 *112 1,525 *2,596 348 365 232 638 637 3,190 264 1,112 834 340 773 19,058 16,617 117 126 1,969 2,388 633 513 199 765 749 3,787 305 1,056 956 402 994 24,144 22,894 101 240 2,375 2,836 725 667 1932. 109 529 712 1,698 188 394 963 290 527 7,121 2,829 310 194 956 1,635 298 687 1931. 138 802 877 2.294 192 607 1,168 373 672 8,451 3,521 403 206 956 1,828 238 467 46,809 49,441 63,195 19,440 23,191 Grand total Southern District__ 80.202 90,094 111,968 42,258 50,243 Northwestern DistrictBelt By. of Chicago Chicago & North Western Chicago Great Western Chic. Milw. St. Paul & Pacific_ Chic. St. Paul Minn.& Omaha_ Duluth Missabe & Northern_ __ Duluth South Shore & Atlantic_ Elgin Joliet & Eastern Ft. Dodge Des M.& Southern_ Great Northern Green Bay & Western Minneapolis & St. Louis Minn. St. Paul & S. S. Marie Northern Pacific Spokane Portland & Seattle_ ___ 628 11,470 2,028 15,852 3,429 401 412 2,464 209 7,608 514 1.483 4,087 8,246 706 939 13.670 2,569 18,167 3,516 388 444 3,274 249 7,575 507 1,777 4,533 8,427 716 1,224 16,261 2,682 21,279 4,692 659 898 5,054 297 10,124 529 2,395 5,402 11,520 968 1,177 7,138 2,091 5.440 2,158 67 347 3,458 130 1,443 274 1,299 1.279 1,649 760 1,113 8,100 2,331 6.381 2,492 91 366 4,148 154 1,677 348 1,178 1.617 1,880 868 59,537 66,751 83,984 28,710 32,744 16,749 2,564 *233 13,333 9,535 2,993 1,034 3,764 650 886 361 70 9,832 230 263 10,783 1,398 872 20,305 3,090 224 15,922 12,945 2,731 1,699 3,189 432 1,693 388 96 12,670 241 231 13,307 1,137 1,503 25,235 3,460 238 22,067 14,181 3.167 2,086 4.141 624 1,485 636 147 17,064 320 262 16,594 1,046 1,473 3,481 1,410 33 5,345 5,150 1,486 663 1,658 2 741 207 40 2,639 222 695 5,968 1,149 3,906 1,752 39 5,114 5,995 1,870 780 1.780 5 929 184 79 3,250 207 652 6,045 12 1,232 75,552 91.803 114,226 30,895 33,831 121 *137 190 1,311 262 1,669 289 1,421 795 365 680 46 4,212 12,570 44 198 6,746 1,728 328 5,075 3,582 1,196 28 130 119 278 2,083 113 1,489 259 1.625 1,236 254 850 49 5,158 14,472 43 03 8,385 2.291 446 6,269 4,795 1,577 28 173 259 324 2,276 368 1,950 333 2.168 1,262 339 843 122 5,552 17,643 43 89 9.652 2,215 643 7.682 6,281 1,876 45 2,720 552 94 884 23 1,447 577 1,188 873 395 180 240 1,963 6,062 9 129 2,254 955 238 1,949 2.382 1,940 56 2,362 523 86 1,134 32 1,829 825 1,558 1,196 372 273 617 2.183 6,211 123 86 2.668 1,078 196 2,137 3,045 2,222 38 42,993 52,042 62,138 27,110 30,794 Total Total Central Western DistrictAtch. Top. & Santa Fe System_ Alton Bingham & Garfield Chicago Burlington & Quincy.. ChicagoRock Island & Pacific_ Chicago dc Eastern Illinois Colorado & Southern Denver & Rio Grande Western_ Denver & Salt Lake Fort Worth & Denver City_ _-Northwestern Pacific Peoria & Pekin Union Southern Pacific (Pacific) St. Joseph & Grand Island Toledo Peoria & Western Union Pacific System Utah Western Pacific Total Southwestern DistrictAlton & Southern Burlington Rock Island Fort Smith & Western Gulf Coast Lines Houston & Brazos Valley International-Great Northern Kansas Oklahoma & Gulf Kansas City Southern Louisiana & Arkansas Litchfield & Madison Midland Valley Missouri & North Arkansas Missouri-Kansas-Texas Lines__ Missouri Pacific Natchez & Southern Quanah Acme & Pacific St. Louis-San Francisco St. Louis Southwestern San Antonio Uvalde & Gulf._._ Southern Pacific in Texas dr La_ Texas & Pacific Terminal rat. Assn. of St. Louis Weatherford Min. Wells & NW Total 6 z Included in New York Central. y Included in Baltimore dr Ohio RR. z Estimated. • Previous week. Business Conditions As Viewed by National Association of Purchasing Agents-Finds Improvement Exceptional. In its Dec. 28 bulletin the National Association of Purchasing Agents has the following to say regarding business conditions: General business conditions are about the same as during the month of November with a slight inclination to be worse, and any improvement being exceptional. Commodity prices remain practically the same as In the previous month, although showing a tendency to be lower. In no case was there an indication that prices at the present time are higher than in the previous month. While there has been a tendency for coal prices to stiffen in the Middle West, this seems to have somewhat abated. Crude oil prices in the Southwest are somewhat weak, as is the price of steel scrap and pig iron. In the Northwest after a small increase, lumber prices have again started to weaken. Developments in California tend to show an interesting transaction regarding cement, which might he consummated in the near future. Inventories are at this time of the year the lowest minimum which It is possible to have; there being no reason both in view of the closing of the year and present business conditions, why inventories should be other than they are at present. Collections are being maintained about as they have been in recent months. In some eases In the Middle West they have been somewhat slower In the past month. Credit remains as it has during the last several months, ample in cases where sufficient security is provided; otherwise the tendency is to bo very tight. Unemployment is about as It was during the month of November, excepn that in the automotive centres the tendency to improve is seasonal. It the far West the unexpected cold weather has been somewhat damaging to the fruit crop. There Is also showing along the West Coast more interest recently in buying American products. In Canada the debt question keeps the situation considerably upset until some solution has been determined. There is more of a tendency noticeable in the buying policies of the committee members to cover for a longer period, where commodities are in a particularly attractive buying position. On these particularly attractive materials, some committee members have covered well into 1033; but a policy of selective covering Is still maintained. Slight Drop in Sales and Collections Indicated in Survey of National Association of Credit Men. Only a slight drop in sales and collections is noted in the January survey of nation-wide conditions, published Jan. 2 in Credit and Financial Management, official publication of the National Association of Credit Men. The survey, based on reports from correspondents in 108 major markets throughout the country, says: Slightly over 50% of the cities reporting note collections to be slow, which is the same average as existed the month before, but in sales reports of slow selling conditions increased slightly. The major cause of a rereagion in the upward course which sales and collections have been traveling for the past four months is the dropping from good to fair of several cities. In the previous survey six cities reported good collections and three good sales, while this month there are two reports of good collections and only ono of good sales. Boise, Idaho, is the sole representative in the good sales column while New Haven, Conn., and Ft. Worth, Tex., are found in the good collections Volume 136 27 Financial Chronicle bracket. Ft. Worth is the only city to retain its ranking having reported good collections in December as well. Supplementary reports by correspondents reveal that in Michigan. Flint, notes improving collections, Grand Rapids feels an improvement in furniture lines. Jackson reports better collections. Duluth, Minn.,experienced a slight pick-up in unemployment. St. Paul believes that due to the defeat of the proposed three-year debt moratorium in North Dakota at the last election, that credit strain will be relieved and sales should improve. Smaller Percentage Decline Shown in Electric Output During Month of November 1932. According to the Department of Interior, Geological Survey, production of electricity for public use in the United States during the month of November 1932 amounted to 6,937,023,000 kwh., as compared with 7,406,165,000 kwh. during the same period in 1931, or a falling off of 6%. The percentage decline for the month of October 1932 as against the corresponding month in the preceding year was 9%. of the total for November 1932 there were produced by water power 2,865,133,000 kwh. and by fuels 4,071,890,000 kwh. The Geological Survey's statement follows: PRODUCTION OF ELECTRICITY FOR PUBLIC USE IN THE UNITED STATES (IN KILOWATT-HOURS). Total by Water Power and Fuels. Sept. 1932. Oct. 1932. Nov. 1932. New England 484,569,000 504,421,000 501,872.000 Middle Atlantic_ - _ 1,826,414,000 1,976,615.000 1,887,072,000 East North Central_ 1,429,399,000 1,553,506.000 1,518,769,000 West North Central_ 440,937,000 444,239,000 430,194,000 South Atlantic 723,359,000 779,921,000 858.732,000 East South Central_ 308.067,000 308,552.000 314,615,000 West South Central_ 358,230,000 346,354,000 337,385,000 Mountain 210,016,000 197,564,000 193,430,000 Pacific 953,587,000 941,534,000 894,954,000 Chance in Output from Precious Year, Oct. '32. Nov.'32. -9% -7% -9% -13% -11% +4% -14% -24% -7% -2% -9% -9% -11% +7% +13% -11% -22% -6% general economic conditions, however, natural gas sales for Industrial purposes registered a decline of about 15%. In addition to this decline in ordinary industrial sales, the amount of natural gas used for non-utility purposes, including manufacture of carbon black and consumed in oil and gas field operations, apparently declined some 22%, with the result that the entire consumption of natural gas for all purposes during 1932 is expected to run about 16% under the corresponding figure for 1931. Natural gas customers in 1932 were only 1.1% fewer than in 1931. "The economic situation offers an easy mark for agitations for reductions in rates," said Mr. Forward, "although further reductions in revenues will, in most instances, imperil the public service." "The American Gas Association, however, is fully alive to the situation," he continued. "We have set up a committee composed of foremost executives of the industry for a comprehensive national program., which is expected to prove of immense value in keeping our business stabilized and in extending an essential public service. Manufacturers of gas ranges and other appliances are active and alert. We are continuing our research program. The continued improvement and consequent insurance of safe and efficient appliances in the home and automatically controlled appliances in industry are some of the most apparent proofs. I think that the gas industry is alive to its future and to the needs of reviving industry." Electric Production Lower in Christmas Week. According to the National Electric Light Association, the production of electricity by the electric light and power industry of the United States for the week ended Dec. 31 1932 was 1,414,710,000 kwh., compared with 1,554,473,000 kwh. for the preceding week and 1,523,652,000 kwh. for the corresponding period in 1931. No percentage comparisons can be made with the same week of 1931, because a year ago the week included New Year's Day, while this year that holiday came a week later. Arranged in tabular form, the output in kilowatt hours of the light and power companies for recent weeks and by months since the first of the year 1932 is as follows: Total for U.S 6,734,578,000 7,052,706,000 6,937,023,000 -9% -6% The average des y production of electricity for public use in November was 231.200,000 kwh., about 2% more than the average in October. The normal change from October to November is an increase Of about 0.5%. The average daily production of electricity by the use of water power in November was about 9% greater than in October and 36% greater than in November 1931. These marked increases In production of electricity by the use of water power reflect the increase in the flow of power streams due to the increase in precipitation during the fall months and Indicate the end of the drought conditions which have persisted for the past two or three years. From the records for this year from January to November,it Is estimated that the total production of electricity for public use in 1932 will be about 53.000,000.000 kwh., about 93.% less than in 1931. TOTAL MONTHLY PRODUCTION OF ELECTRICITY BY PUBLIC UTILITY POWER PLANTS IN 1931 AND 1932. January February _ March April May June July August September. October __ November ... December_ 1931. Km. Hours. 1932. Kw. Bouts. 7,956,019,000 7,169,815,000 7,887,713,000 7,655,472,000 7.645.110,000 7,528,592,000 7,771,992,000 7,629,920,000 7,540,377,000 7,764,889,000 7,406,165,000 7,773,286,000 7,542,624,000 7,002,151,000 7,301,976,000 6,778,652,000 6,635,475,000 6,548,831,000 6,530,706,000 6,742,988,000 6.734,578,000 7,052.706,000 6,937,023,000 1931 Under 1930. 8% 6% 4% 5% 5% 3% 2% 3% 3% 5% 4% 4% 1932 Under 1931. 5% a6% 7% 11% 13% 13% 616% 12% 11% 9% 6% _--- Produced by Water Power. 1931. 1932. 30% 30% 34% 41% 41% 38% 35% 32% 29% 27% 28% 35% 41% 42% 42% 46% 45% 41% 41% 38% 36% 39% 41% --_ Total 91.729.380000 4*1. 22M, a Based on average daily production. b Fewer working days in July 1932, than in July 1931. The quantities given in the tables are based on the operation of all power plants producing 10.000 kwh. or more per month, engaged in generating eleCtricity for pubilc use, including central stations, both commercial and municipal, electric railway plants, plants operated by steam railroads generating electricity for traction, Bureau of Reclamation plants, public works plants, and that part of the output of manufacturing plants which Is sold. The output of central stations, electric railway and public works wants represents about 98% of the total of all types of plants. The output as published by the National Electric Light Association and the "Electrical World" includes the output of central stations only. Reports are received from plants representing over 95% of the total capacity. The output of these plants which do not submit reports is estimated; therefore, the figure's of output and fuel consumption as reported in the accompanying tables are on a 100% basis. [The Coal Division, Bureau of Mines. Department of Commerce. cooperates in the preparation of these reports.] Revenues from Manufactured Gas in the United States Declined 5.1% in 1932-Sales Off 4.8%. Revenues from manufactured gas in the United States in 1932 aggregated about $413,250,000, representing a decrease of 5.1% from the 1931 figure, according to Alexander Forward, managing director of the American Gas Association. While total sales of manufactured gas to consumers registered a decline of 4.8%, according to preliminary estimates of the Association's statistical department, an outstanding exception to the general trend was the increase shown in the use of gas for house heating purposes. In 1931 sales of manufactured gas for house heating purposes were 19,908,100,000 cubic feet, but during 1932 this figure rose to 20,445,600,000 cubic feet, an increase of 2.7% in this class of business. The Association further reports as follows: The decline in natural gas sales for domestic and commercial purposes Was relatively small, amounting to less than 5.4%. In keeping with Weeks Ended. 1932. 1931. Jan. 2 ---- 1,523,652,000 1,597,454,000 Feb. 6 ---- 1,588.853,000 1,679,016,000 Mar. 5 ---- 1,519,679,000 1,664,125,000 April 2____ 1,480,208,000 1,679,764,111 May 7 ____ 1,429,032,000 1,637,296,000 June 4 ____ x1,381,452,000 1,593,622,000 July 2 ---- 1,456,961,000 z1,607,238,000 Aug. 6 ____ 1,426,986,000 1.642,868.000 Sept. 3 ---_ 1,464,700,000 1,635,623,000 Oct. 1 -_-_ 1,499,459,000 1,645,587.000 Oct. 8 --- 1,506,219,000 1,653,369,000 Oct. 15 ---- 1,507,503,000 1,656,051,000 Oct. 22 ---_ 1,528,145,000 1,646,531,000 Oct. 29 -_-_ 1,533,028,000 1,651,792,000 Nov. 5 ---- 1,525.410,000 1,628,147,000 Nov. 12 -_-_ 1,520,730,000 1,623,151,000 Nov. 19 ---- 1,531,584 000 1,655,051,000 Nov.26 -_ 1,475,268,000 1,599,900,000 Dec. 3 --- 1,510,337,000 1,671,466,000 Dec. 10 ____ 1,518,922,000 1.671,717,000 Dec. 17 -_-_ 1,563.384,000 1,675,653,000 Dee. 24 ____ 1,554,473,000 *1,564.652,000 Dec. 31 --- •1,414,710,000 1,523,652,000 MonthsJanuary ---_ 7,014,066,000 7,439,888,000 February ___ 6,518,245,000 6,705,564,000 6,781,347,000 7,381,004.000 March April 6,303,425,000 7,193,691,000 6.212,090,000 7,183,341,000 May June 6,130,077,000 7,070,729,000 July 6,112,175,000 7,286,576,000 6,310,667,000 7,166,086,000 August September_ - 6,317,733,000 7,099,421,000 October ____ 6,633,865,000 7,331,380.000 November_ 6,971,644,000 December 7.288,025,000 1932 Under 1931. 1930. 1929. 1,680,289,000 1,781,583,000 1,750,070,000 1,708,228,11' 1,689,034,000 1,657,084,000 1,594,124,000 1,691,750,000 1,630,081,000 1,711,123,000 1,723,876,000 1,729,377,000 1,747,353,000 1,741,295,000 1,728,210,000 1,712,727,000 1,721,501,000 1,671,787,000 1.746,934,000 1,748,109,000 1,769,994,000 1,617,212.000 1,597,454,000 1,542,000,00' 1,726,161,000 1,702,570,000 1.663.291,000 1,608.492,000 1,689,925,000 1,592,075,000 1,729.667,000 1,774,586,000 1,819,276,000 1,806.403,000 1,798,633,000 1.824.160.1 I 1 1,815,749,000 1,798,164,000 1,793,584.000 1,818,169,000 1,718,002,000 1,806,225,000 1,840.863.000 1,860,021.000 1,637,683,000 1,680,289,000 4.6% 5.4% 8.7% 11.9% 12.7% 13.3% 9.3% 13.1% 10.4% 8.9% 8.9% 9.0% 9.2% 7.2% 6.3% 6.3% 7.5% 7.8% 9.6% 9.1% 6.7% 8,021,749.000 7.066,788,000 7.580,335,000 7,416,191,000 7,494,807.000 7,239,697.000 7,363,730,000 7,391,196.000 7,337,106,000 7,718,787,000 7,270,112,000 7,566,601,000 7,585,334,000 6,850,855,000 7,380,263,000 7,285,350.000 7,486,635,000 7,220,279,000 7,484,727,000 7,772,878.000 7,523,395,000 8,133,485,000 7,681,822,000 7,871,121,000 5.7% y6.1% 8.2% 12.4% 13.5% 13.3% 16.1% 11.9% 11.0% 9.5% -_- ...- Total 86,063,969,000 89,467,099.000 90,277.153,000 x Including Memorial Day. y Change computed on basis of average daily reports. • Includes Christmas Day. 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%. s Including July 4 holiday. President Green of American Federation of Labor Hints "Force" to Get Short Week-Declares Labor's Patience With Industry at an End and Action Will Be Demanded-Convention Backs Stand for 30-Hour Standard. A call to the militant spirit of organized labor was sounded at the convention of the American Federation of Labor at Cincinnati on Nov. 28 by President William Green, who declared that labor would strive with all its strength to compel the universal adoption in industry of the five-day week and the six-hour day. Cincinnati advices Nov. 28 to the New York "Times" went on to say: Stirring the delegates to enthusiastic applause in what they declared was "the greatest fighting speech" of his career, Mr. Green said that labor's patience with industrial management was at an end and that its Paramount policy henceforth would be to resort to "forceful methods" it necessary to establish the shorter work week. By these methods no said he meant use of every weapon in the union armory, economic, political and industrial. The speech was followed by the unanimous adoption of a report calling for the "universal adoption without delay" of the six-hour day and the five-day week, with the maintenance of present wage rates at least and wage increases if possible. The declaration included strong opposition to the share-the-work movement "with its pay reduction policy now urged in many quarters and which would defeat the very purpose it is proclaimed to serve." To Demand Gorernment Example. It was indicated by Mr. Green that the spearhead in the movement for the immediate adoption of the 30-hour week would be a demand on the Financial Chronicle 28 Federal'Government that it set an example by establishing this reform. Mr. Green and the members of the Executive Council were empowered to present labor's demands to President Hoover and to Congress, together with a copy of the former's speech emphasizing that labor would no longer be denied the shorter work-wee.c and work-day. Mr. Green's speech came at the end of a °my day which began with an address by Secretary of Labor Doak, who revealed that death threats had been made against him because of his immigration policy. In denouncing the "racketeers who prey upon immigrants illegally," Secretary Doak said: "It is not pleasant to be called up at night over the telephone and to listen to threats from these persons that they will kill you. But I am still here and will continue our campaign to send these racketeers to prison." He told reporters that just before he was to make an address in Brooklyn his wife was called to the telephone by a person who told her Mr. Doak would be assassinated if he made the speech. He went to the meeting withoat protection. Some one in the audience tried to start trouge but was ordered out by the chairman. "Annalist" Weekly Wholesale Price Index Declined for Eighth Consecutive Week During Week of Jan. 3Index at New Low Point. In the eighth successive week of decline, The Annalist Weekly Index of Wholesale Commodity Prices dropped to a new low of 83.7 on Jan. 3, from 84.3 (revised) the week previous, and 94.7 a year ago. In noting this, the "Annalist" also said: Sharp seasonal declines in live stock accounted for the loss, and more than offset higher prices for wheat and cotton. Except for live stock and the meats the commodities were fairly steady, thanks in patt to the stimulus of a stronger stock market. THE ANNALIST WEEKLY INDEX OF WHOLESALE COMMODITY PRICES. (1913=100) (Unadjusted for seasonal variation.) Jan. 3 1933. Dec. 27 1932. Jan. 5 1932. Farm products Food products Textile products Fuels Metals Building materials Chemicals Miscellaneous All ertm Mild ItiP9 •Provisional. x Revised. 63.5 92.5 *67.6 118.4 94.7 106.6 95.5 71.9 83.7 64.0 93.0 :67.5 118.4 94.7 106.5 95.5 71.8 x.84.3 80.1 98.9 79.7 123.8 98.1 109.0 96.6 86.9 94.7 Compulsory Unemployment Insurance Endorsed by American Federation of Labor at Annual Convention in Cincinnati. Reversing its former stands, the American Federation of Labor at its annual convention in Cincinnati on Nov. 30 declared its support of a system of compulsory unemployment Insurance. Associated Press accounts from Cincinnati on Nov. 30 stated: k It (the Association) accepted its Executive Council's plan for compulsory unemployment insurance, paid for by industry and administered by the State, and as it did in calling for the six-hour day and five-day week, it backed its proposal with threats of strikes and boycotts. 0, "We will go out and fight for our program," William Green, President of the Federation, had declared, and other speakers had urdge that "just as our President threatened 'force' in gaining our other 'demands' so we can resort to 'force' in the interest of unemployment relief." Green had explained in referring to his threat of "force" that he meant "economic force"-strikes, boycotts and picketing. The Federation convention then supported "immediate modification of the Volstead Act" and "repeal of the Eighteenth Amendment as rapidly as that can be brought about." Just one year ago the Federation threw oat three resolutions for unemployment insurance. To-day, motivated by /that leaders called "needs of the hour." it rallied to fight along a Nationa front for such a plan. But its recommendation was not expressed unanimously. In lengthy and often heated debate, several delegates declared the costs would only ultimately fall on labor, and some preferred to "use economic power (strikes and boycotts) to make industry furnish jobs rather than to have it provide insurance." Green defended the plan but agreed "employment would be better." "But," he shouted, "if denied the opportunity to work, from a social point of view, what are we going to do with the unemployed? Unemployment insurance is the answer." Ohioan Favors Plan. Thomas J. Donnelly, Secretary of the Ohio Federation of Labor, supporting the plan, asserted "had Ohio started an unemployment insurance plan in 1921, it would have had approximately $184,000,000 available for the unemployed in the last three years." Labor now is to work in every State for unemployment Insurance legislation. Its ideal plan would be compulsory; would create reserves from assessments on employers, suggesting a minimum of 3% of annual pay rolls; have those funds administered by State commissions; and would pay benefits to all unemployed, even granting partial benefits to those not working at full-time. The Executive Council said "the whole scheme of unemployment insurance should be constructed so as to induce and stimulate, so tar as possible, the regularization and stabilization of unemployment." The passage of unemployment insurance legislation in each State and the supplementing of such State legislation by Federal enactments, was advocated in a report of the Executive Council of the American Federation of Labor, presented at its annual convention in Cincinnati on Nov. 21. The report stated that "as a matter of principle, no part of the contributions to support unemployment insurance should be paid out of the wages of labor, but the whole should be paid by management as part of the cost of production." "The necessary funds," the report added, "should be raised as Jan. 7 1933 a charge on industry." The roport further Said: The amount of such contribution must depend upon the local conditions In each State. A minimum contribution must be required sufficient to cover (a) the building up of adequate reserves. (b) the cost of the benefits to be paid under the Act, and (c) the costs of administration. To cover these costs the American Federation of Labor believes that the contribution rate should be not less than 3% of the total payroll. According to Cincinnati advices Nov. 20 to the New York 'Times," the Executive Council refrained from drawing up a model bill, but formulated the following set of principles which it suggested be used as a guide in framing such legislation: Union members must be protected from any obligation to accept work contrary to the rules of their organizations or which would help to depress wages and working conditions. The insurance legislation should help to regularize and stabilize employment. . . From the same account we also quote: Membership Falls in Year 357,289. Opposing voluntary schemes of unemployment insurance, the Council deems it necessary, pending the adoption of compulsory State insurance, that voluntary unemployment schemes be subjected to State regulation, The benefit funds of voluntary insurance plans should be kept in separate trust accounts, according to the report. The report states that the immediate and urgent problem before organized labor is unemployment. Other planks in the Council's program to increase employment include the following: The five-day week and shorter work day, division of work, a large public works program, furtherance of self-liquidating projects, adequate relief funds, an increasing proportion of which must come from Federal sources, and the calling of a national conference to take the first steps toward national economic planning. Secretary Frank Morrison's report for the year ended Aug. 31 shows a falling off of 357,289 in the membership of the Federation, the total being 2,532,261, as compared with 2,889,550 in the previous year. Declares Distribution Faulty. "The crisis in our economic order calls for reconsideration of those essential principles which are its cornerstones," the report of the Executive Council declared. "In the revisions which shall constitute the policies of the future, labor will be responsible for getting incorporated understanding of the equities which a producing worker has in his job and proportionate consideration of social values involved. The immediate and urgent problem 18 unemployment." Estimating the number of unemployed in the country as more than 11,000,000, the report declares that the reason for this situation is to be found in the faulty distribution of the products of industry as against the achievements of American productive processes. To permit this situation to continue is "sheer stupidity," the report asserts, adding that "our energies must be redirected to restore sanity and balance in economic life." The report estimates that this year nearly 8.000,000 more persons have been out of work than in 1930, and that due to unemployment and wage reductions workers' income is scarcely more than half that of 1929, their loss this year alone being probably 625,000.000,000. By the end of its third year the depression will have cost workers more than $48,000,000,000 in wage and salary losses alone, the report asserts. "The need now Is to restore lost buying power," the report continues. "Industry is not making a real effort to do this. Dividend payments are still above the 1928 level, while wages have fallen below 1922. There is no general movement to increase wages. To delay the rebuilding of buying newer is to prolong depression." Holds Shorter Week Is Needed Now. Declaring that higher wages and the shorter week are essential elements in any program toward rehabilitation, the report says that the "five-day 40-hour week and the six-hour day with a 36-hour week represent standards applicable to normal times at present," but that "in the emergency of this fall and winter hours must be reduced even below this standard to provide work for the unemployed and prevent starvation." As steps toward "worker security," the report proposes the following: Organization of the job market through a system of State employment services under Federal co-ordination. Organization of wage workers into trade unions under their own control. Distribution of man-hours so that all may have an opportunity to earn a living. Higher wages. Vocational counsel and retraining to assist boys and girls to find the kind of work for which they are best fitted. National economic planning for the purpose of balancing production and distribution. "Balance is our hope for mitigating the severity of business depressions and attendant unemployment," the report states. "Plans for maintaining economic balance must grow out of a unified basic philosophy and coordinated procedure to advance human well-being." Assert Equities of Workers. As "integral parts of such a central plan," the report recommends the following: Steeply graduated income and inheritance taxes. Constructive control of credit to finance production. Recognition of the equities of workers in the industries in which they work and at least protection equal to that given financial investments. Federal agency to collect and collate data on man-hours and wageearner income, necessary to appraise producing workers' participation in industrial progress. Such an agency would provide the standards for determining economic balance. Federal licenses for corporations operating on an inter-State scope, with specific requirements as to accounting. All accounts available to those interested, and protective service for Investors. Organization of wage earners to advance their interests intelligently within industry and other relationships. "We believe that national economic planning should aim at raising standards of living for lagging groups and not at a program of limitation of production with price fixing," the report adds. "We need to find out how best to use our capacity to produce." As an ameliorative measure in periods of unemployment, the report urged advance planning of public works and use of national credit for selfliquidating projects, for building homes for workers and other small income groups, for slum reclamation and similar undertakings. "Planning the expansion and contraction of national credit should be a part of the whole undertaking of economic planning, based upon a reliable Financial Chronicle Volume 136 standard of economic and social soundness," the report maintains. "The type of undertakings to be financed and details of construction work should be worked out in advance so as to further in balanced proportions the promotion of national welfare. "The only cure for unemployment is employment. Every relief plan gains in soundness as it approximates normal conditions of incomes from the creation of wealth needed by society. When industry breaks down. emergency construction undertakings will stimulate recovery." The text of the unemployment insurance proposal, as reported by the Executive Council, is taken as follows from the "Times": It would be desirable, were it possible, to press for the enactment of one uniform measure for unemployment insurance applicable throughout the United States. But, due to the provisions and limitations of the United States Constitution as interpreted by the courts, since the regulation of manufacture and industry lies primarily within the province of State rather than Federal activity, it is practically impossible to enact constitutional Federal legislation adequately providing for unemployment Insurance covering employees engaged in work in the different States. The American Federation of Labor, therefore, advocates the passage of unemployment insurance legislation in each separate State, and the supplementing of such State legislation by Federal enactments; such, for instance, as bills covering employees engaged In inter-State commerce or employed in the District of Columbia or in Federal territories, or such as the bill recently introduced into Congress by Senator Wagner, allowing corporations substantial income-tax credit on their Federal income taxes for such payments as they have made under State laws toward the creation of unemployment reserves. It is evident that the local conditions of each State vary to such a marked degree that it would be unwise, even were it possible at the present time, to frame a single model bill to be enacted in every State. It is possible, nevertheless, to set forth certain general fundamental principles and standards to which such State legislation should conform. The American Fed eration of Labor, after mature consideration and discussion, has formulated the following principles which should guide in the framing of State unemployment insurance bills: To Protect Union Standards. Every unemployment insurance Act should contain specific provisions to protect union members from being obliged to accept work contrary to the rules and regulations of their organizations or employment under conditions such as tend to depress wages or working conditions. 2. Unemployment insurance legislation in this country should be carefully devised to promote its two primary objective: (a) The stimulation of more regular employment, in so far as possible, and (b) the payment of unemployment compensation to those who are temporarily out of work through Industry's failure to provide steady employment for its working forces. 3. The American Federation of Labor advocates a scheme of unemployment compensation made compulsory by law. Voluntary schemes are unlikely to pervade industry generally and are frequently open to other serious objections. Only by compulsory legislation can workers be adequately protected. 4. Sine unemployment is to a certain extent one of the inevitable incidents of production and must, therefore, be regarded as part of the inescapable cost of industry, it, like other costs of industry, should be paid by industry itself. It, therefore, follows that, as a matter of principle, no part of the contributions to support unemployment insurance should be paid out of the wages of labor, but the whole should be paid by management as part of the cost of production. The necessary funds should be raised as a charge on industry. Urges 3% of Payroll. The amount of such contribution must depend upon the local conditions in each State. A minimum contribution must be required sufficient to cover (a) the building up of adequate reserves, (b) the cost of the benefits to be paid under the Act, and (c) the costs of administration. To cover these costs the American Federation of Labor believes that the contribution rate should be not less than 3% of the total payroll. The exact percentage, however, must vary in different States and will come to depend upon various actuarial data, which must be carefully collected as a basis for such determination from the experience gained both before and after the passage of the Act. The absence of complete data should not, however, prevent the passage of a law, since the liability of the fund is limited to the amount of the income provided by law. As experience is accumulated it will be possible to determine the income necessary to provide the benefits decided upon In the law. 5. At this time the American Federation of Labor deems it inadvisable to take an irrevocable stand as between the plant reserves system or unemployment insurance embodied in the Wisconsin law and an insusnce system such as is under consideration in Ohio and in operation in many European countries. Whatever plan is adopted, whether based on plant reserves or on a broader basis, we believe that it should be administered by the State and all reserve funds held and invested by the State. We are unalterably opposed to company-controlled unemployment reserves and believe that Without State administration plant reserves will prove but another "company union" device We are also of the opinion that, at least at the outset, it is advisable to have but a single unemployment insurance fund (with, if a plant reserves system is adopted, separate accounts for separate employers) and a flat rate of contributions by employers regardless of the industry in which they may be engaged. Later on, after more accurate data are obtained, occupation or enterprise may be scaled according to the hazard of unemployment, but suf'dent data are not now available to warrant such classifications at this time. Would Exclude Companies. 6. Sound public policy requires that no insurance company in this country be allowed to invade this new field of unemployment compensation. No Insurance company is allowed under present State laws to write this class lof insurance. The Federation believes that this policy is wise and should in no case be abandoned. 7. All funds should be invested in Federal securities or in the bonds of State or municipalities such as have never defaulted in the payment of principal or interest. 8. Insurance in general should cover temporary and involuntary unemployment. Unemployment means the conditions caused by the inability of an employee who is capable of and available for employment to obtain work in his usual employment or in another for which he is reasonably fitted. Nothing in the unemployment compensation Act should require an employee to accept employment, nor should any employee forfeit his right to benefits under the Act by refusing to accept employment under any or all of the following conditions: 29 work (a) In a situation vacant directly in consequence of a stoppage of due to a trade dispute; (b) If the wages, hours and conditions offered are less favorable to the employee than those prevailing for similar work in the locality, or are such as tend to depress wages and working conditions: right (c) If acceptance of such employment would abridge or limit the or of the employee either (1) to refrain from joining a labor organization association of workmen, or (2) to retain membership in and observe the rules of any such organization or association; are discharged (d) Workers who quit work without good cause or who for misconduct shall not thereby forfeit benefits beyond a reasonable period. Scope and Benefit Payments. 9. The coverage should be as wide as possible. It should include clerical as well as manual workers. There are, however, certain classes of employment which it may be necessary to exclude from the general operation of the Act,and these classes will vary according to local conditions. It would seem that the legislation should approximate, in so far as practicable. the coverage of State workmen's compensation Acts. As time goes on the scope or coverage of the Act may well be broadened. 10. The claim of employees to receive unemployment compensation as provided under the Act should be clearly recognized as a legal right earned by previous employment within the State. Receipt of unemployment benefits shall in no way entail loss of suffrage or other civil rights. Persons not legal residents of the State and those not citizens of the United States shall not by reason of that fact be disqualified from receiving benefits. The amount of benefits to be paid and the number of weeks during which they shall be paid must depend upon the local conditions in each State and upon the amount of contributions paid into the fund. We are Informed, for instance, that under the conditions previling in Ohio a contribution of 3% of the total payroll makes it possible after a waiting period of three weeks per year to pay benefits for a maximum period of 16 weeks in a year based upon 50% of the normal weekly wages, but not to exceed $15 a week. It seems advisable to restrict the payment of benefits to unemployment occurring after a specified waiting period. The length of this waiting period will materially affect the amount of the benefits which can be paid and the length of time during which they can be paid. Workers who are partially unemployed should receive unemployment compensation at a reduced rate. The exact amount of the reduction will presumably vary in different States. We suggest that a fair principle would be to pay for partial unemployment the amount of the benefit which would be payable in case of total unemployment reduced by subtracting one-half of the amount of the wags; actually received. Administration by States. 11. (a) The administration of the scheme of unemployment compensation and the responsibility for the keeping and investment of the unemployment funds should be in the hands of a State commission. This should be either a special commission created for the specific purpose or an already existing State commission or department of labor. (b) Both labor and management should have a voice in the administration of unemployment insurance. Advisory committees composed of an equal number of representatives of labor and management will prove very useful and, in some States, local appeal boards similarly constituted Will be found desirable. It should be recognized, however, that workingmen can have genuine representation only through labor organizations. Unless labor can, in effect, through its organization select its own representatives, pretended representation is but a farce. (c) The cost of the administration of unemployment compensation should be met out of the unemployment fund itself. (d) The operation of employment exchanges is closely and vitally Connected with the administration of unemployment insurance. The commission should take over, supervise and expand public employment exchanges in States where these already exist or in States where none exists should create and operate such exchanges. (e) The administration regulating the payment of benefits should be decentralized as far as possible. Payments should be made upon claims presented through local agencies, established and supervised by the commission and acting in close co-operation with the public employment offices. Appeals should be allowed to a central authority. Regulating Employment. 12. The whole scheme should be so construed as to induce and stimulate so far as possible the regularization and stabilization of employment. This may be effected in various possible ways; as, for instance, by basing the amount of contributions payable upon some merit-rating scheme or in States not adopting an exclusive state fund by the establishment of separate Industry or separate plant funds. This statement embodies within it certain standards and principles that we believe should be incorporated in unemployment insurance legislation. We suggest, however,that a flexible policy be pursued in all States and that unemployment insurance legislation be secured which will maintain the above standards so far as possible and yet which will accommodate Use f to the varying circumstances and conditions in each State. It is essential that the protection of the rights of citizenship and of union membership be maintained in all Acts. Pending the adoption of compulsory State insurance voluntary unemployment schemes should be subject to State regulation. We therefore believe it vital that suitable legislation be enacted to provide for State supervision of all such plans, including as a minimum the deposit of benefit funds in separate trust accounts, whether or not such funds include payments made from employees. Resolutions Adopted at Convention of American Federation of Labor—Leaders in Campaign to Reduce Government Costs Are Warned Against "Going Too Far"—Bankers Are Condemned— Demand for Laws to Safeguard the Deposits of Wage-Earners Receives Convention Approval— Prohibition and Unemployment Insurance. In its account of the resolutions adopted on Nov. 30 at Cincinnati by the American Federation of Labor at its annual meeting, the New York "Times" had the following to say in part: By an overwhelming vote the American Federation of Labor convention to-day reversed Its past policy and went on record as favoring compulsory unemployment insurance under State auspices. Another precedent set to-day was endorsement by the delegates of a resolution calling for repeal of the Eighteenth Amendment. Hitherto the Federation has contented itself with demanding 2.75% beer, but the wets , 30 Financial Chronicle were In control and liberalized this measure further by eliminating the percentage provision and urging the immediate modification of the Volstead Act to permit the sale of a "wholesome, palatable beverage, non-intoxicating In fact." IS Leaders in the campaign for retrenchment in government expendituresin particular corporations and spokesmen for concentrated wealth- were warned that if their ideas were carried out to their ultimate conclusion they might arouse public opinion to demand "the more equitable distribution of wealth among all classes of our citizens." This would mean that "there can be no justification for a millionaire while there is poverty in the land; a mansion will have no moral right to exist while a hovel is to be found; boulevards cannot be justified while slums remain." Bank Failures Condemned. Banks were condemned for failing to protect wage earners against losses through failures and demand was made for laws to prevent recurrence of the bank failures. Strict regulation over the sale of foreign securities also was approved. Green Urges Insurance Plan. Favorable consideration of the Executive Council's approval of compulsory unemployment insurance was urged in the report of the resolutions committee, headed by Mathew Well, with Victor A. Clander Secretary. At the last two conventions President William Green, Mr. Woll and Mr. dander were ardent opponents of the measure. To-day Mr. Green spoke for it. The officers of the committee did not join In the discussion. Bitter attacks on the proposal were made to-day by Charles P. Howard, a member of the resolutions committee, and John Frey. Secretary-Treasurer of the Metal Trades Department. Among those who supported it were Thomas Kennedy of the United Mine Workers, Thomas Donnelly of the Ohio State Federation of Labor and a member of the Ohio Commission on Unemployment Insurance, Arthur Wharton, a member of the Executive Council. and L. E. Swartz of the National Association of Letter Carriers. Mr. Howard, head of the International Typographical Union, called for defeat of the proposal on the ground that no system of unemloyment insurance could meet the necessities of the depression, while Mr. Frey pointed out that only through trade union organization and activity could proper protection be assured unionists in time of unemployment. Mr. Donnelly declared that if the State of Ohio had started in 1923 to create an unemployment insurance fund there would have been $184,000,000 available for the unemployed by 1929. Mr. Green stressed the recommendation that industry be assessed the entire cost of the insurance, which. according to the proposal, would be at least 3% of the payroll, with benefits of half the weekly pay but not more than $15 a week for 16 weeks. Only 5 Out of 300 Dissent. When the vote was called for only five hands were raised against the report out of more than 300 delegates present. Repeal of the Eighteenth Amendment was approved Over the appeal by President Green, who spoke against it on the ground that the convention represented delegates with every shade of belief on the question. Delegate Edward Fiore of the Hotel and Restaurant Workers and Beverage Dispensers Union fought unsuccessfully to change the report on the Volstead Act to include specific reference to the sale of beer In hotels and restaurants. Delegate Howard opposed repeal and said that the only thing the resolutions committee had failed to do was to "tell the 25.000.000 people living on charity how to get money for beer when they had none for bread." A. J. Kugler of the Brewery Workers Union said that If it were true, as suggested by Mr. Howard, that the beer question was not properly a Federation issue, then his union of devoted militant trade unionists had no place in the convention. Mr. Woll, for the resolutions committee, defended its report on the ground that the time had come for a sane attitude on sumptuary legislation. The report, as adopted, said in part: "We urge the immediate modification of the Volstead Act to permit the manufacture, transport and sale of wholesome, palatable beverages non-intoxicating in fact, and we recommend repeal of the Eighteenth Amendment as rapidly as that can be brought about. We likewise urge modification of the Webb-Kenyon Act so as to afford ample protection to all such States as may elect to prohibit a beverage of a lesser alcoholic content than is urged by this report upon our national Government, or as each may elect, pending final repeal." Study of Unemployment in Buffalo by New York State Department of Labor. Industrial Commissioner Frances Perkins of the New York State Department of Labor announced on Dec. 1 the preliminAry results of the fourth annual study of unemployment in Buffalo, N. Y. The study was directed by Professor Frederick E. Croxton of Columbia University and oovered selected areas of the City of Buffalo. Studies of a like nature and covering the same areas were conducted in November of 1929, 1930 and 1931, therefore comparisons may be made for the last four years. The Buffalo Foundation co-operated with the State Department of Labor in sponsoring the investigation. More than two hundred students of State Teachers' College at Buffalo and the University of Buffalo made over ten thousand house-to-house visits to enumerate the unemployed. The survey as issued by Miss Perkins follows: In November 1932 data were obtained of 14,909 usually employed persons of both sexes who were able and willing to work. Of these, 4,653, or 31.2%, were unable to find work, while 3,355. or 22.5%, were on part time and 6,901. or 46.3%, were fully employed. Summarizing for 1932 the data for males who were able and willing to work, it appears that 44.0% were employed full time, 23.4% were employed part time, and 32.6% were unable to find work. Combining the figures of those unemployed and those employed part time shows that of the able-bodied men who were willing to work 56.0% were either unemployed or underemployed. Comparing the results of the four studies of unemployment, it was found that among the men who were able and willing to work, those who could not find work constituted 6.2% in November 1929, 17.2% in November 1930, 24.3% In November 1931, and 32.6% in November 1932. The proportion of males able and willing to work but unable to secure jobs was thus 1 1-3 times as great in 1932 as in 1931. Of the men who were able and willing to work, those who were employed part time were 7.1% in 1929, 18.6% in 1930, 23.2% in 1931, and 23.4% Ian. 7 1933 in 1932. The proportion of men working part time was only slightly greater In 1932 than in 1931. Unemployment had been of considerably longer duration in 1932 than In 1931. Of the men who could not find work, four-fifths had been out of work ten weeks or more in 1931. while nine-tenths had been out of work ten weeks or more in 1932. Unemployment had lasted a year or more for two-fifths of those out of work in 1931. while in 1932 unemployment had continued a year or more for three-fifths of those unable to find work. A little more than one-third of the men out of work in 1932 had been unemployed two years or more. A report giving the detailed findings of the four Buffalo unemployment studies is to be published shortly by the Department of Labor. Employment facts will be given both for individuals and by households, with statement of the duration of unemployment and the reasons for unemployment. The data will be classified by sex, age, nativity and industry. EMPLOYMENT STATUS OF ALL PERSONS ABLE AND WILLING TO WORK, BY SEX, 1932. Number. Employment Status, Per Cent FeBoth FeMales. males. Sexes. Males. males. Employed full time 5,262 Employed part time 2,795 2-3 but less than full time 846 34 but less than 2-3 1,090 1-3 but less than 14 464 Less than 1-3 394 Fraction not reported 1 Unemployed, able and willing to work 3,903 1,639 560 141 235 96 888 6,901 3,355 987 1,325 560 482 1 44.0 23.4 7.1 9.1 3.9 3.3 (a) 55.6 19.0 4.8 8.0 3.2 3.0 BoCh Baas 46.3 22.5 6.6 8.9 3.8 3.2 (a) 750 4,653 32.6 25.4 31.2 Total 11,960 2,949 14,909 100.0 100.0 100.0 a Leas than one-tenth of 1%. DURATION OF UNEMPLOYMENT OF ALL MALES. Able and Willing to Work but Unable to Find Jobs, 1929-1932. (This table does not include those males not reporting as to duration of unemploYm.t.) Duration of Unemployment. Number. Per Cent, 1932, 1931. 1930. 1929. 1932. 1931. 1930. 1929. Under 2 weeks 55 75 79 112 1.4 2.6 42 15.8 2 and under 4 weeks__. 104 145 147 158 2.7 5.0 7.9 22.2 4 and under 10 weeks 245 371 389 216 6.3 12.7 21.0 30.4 10 and under 20 weeks._ _ 305 392 331 87 7.8 13.4 17.9 12.3 20 and under 30 weeks..... 419 342 264 44 10.7 11.7 14.3 8.2 30and under 40 weeks...230 189 147 22 5.9 6.4 7.9 8.1 40 and under 52 weeks199 153 103 5 5.1 5.2 5.6 0.7 52 weeks:and over *2,343 1,259 391 66 60.1 43.0 21.1 9.3 Total 3,900 2,926 1,851 710 100.0 100.0 100.0 100.0 •Includes 1,425 persons unemployed 104 weeks and over. Industrial Conditions Generally Followed Seasonal Trends During November, According to Federal Reserve Bank of Philadelphia-Unseasonal Decline Reported in Retail Trade Sales-Wholesale Trade Showed Exceptional Gain -More Than Seasonal Decline Noted in Building Industry. The Federal Reserve Bank of Philadelphia states in its "Business Review" of Jan. 2 that "industrial conditions generally reflect seasonal quiet. Output of factory products in November declined more sharply than was commonly expected," the Bank continues, "following an active period of about four months. The drop in the production of anthracite was noticeably smaller than usual, while the output of bituminous coal increased slightly." The following was also reported by the Philadelphia Reserve Bank: Activity in the building and construction Industry, while indicating some favorable features, registered more than seasonal decrease. Retail trade sales declined instead of increasing as normally happens in November, whlle business at wholesale showed a rather exceptional gain. The rate at which retail accounts were settled increased seasonally, while that for wholesale trade showed a fractional decline Sales of life insurance also Increased sharply, while those of new passenger automobiles more than usual. In early December further recessions were decreased indicated for both trade and industry, when allowance is made for the usual fluctuations. The general level of business activity continued seasonal materially lower than that in recent years. The number of commercial failures increased in the month but was a trifle smaller than a year ago; the amount of liabilities, on the other hand, continued to decline. Comparing the first 11 months this year with those of last year, the number of business liquidations was 9% larger, and the amount of liabilities was 31% greater. Industrial employment and payrolls in this section declined seasonally from October to November. Such non-manufacturing occupations as bituminous coal mining. retail trade and laundries reported Increases both In the number of workers and in the amount of wage payments. also added to their working forces but the payroll was smaller Hotels than in October. The principal industries, such as manufacturing, construction, anthracite mining and public utilities, reported reductions in employment and payrolls. In comparison with recent years, virtually all Industries. trades and services showed fewer workers and smaller payrolls. Manufacturing. The demand for manufactured products has fallen off seasonally since the middle of last month and commodity prices generally have shown continued weakness. Unfilled orders for factory products have declined further and are smaller than a year ago. Stocks of finished goods and raw materials held by reporting factories remain smaller than a month ago; they have also been 011 the decline for several months as compared with the last two years. Stocks of conunodities In the country at the end of October exhibited a more favorable position than last year. Holdings of manufactures showed a statistical drop of 6% while inventories of raw materials declined 2% from a year ago. Stocks of manufactured goods have been declining almost steadily since 1930. while those of raw materials showed an upward trend, reaching a record peak in November 1931. Since the middle of this year the rate of seasonal Increase in the accumulation of raw materials has been less pronounced than in the same period km year. Stocks of foodstuffs and raw commodities throughout the world also have shown a downward tendency from a high level reached in June and July. Volume 136 Financial Chronicle Factory employment declined about 1% from October to November and payrolls showed a drop of 8%. according to weighted indexes comprising reports from Pennsylvania, Delaware and New ersey. These decreases are seasonal in character, resembling a similar tendency In the past three years. Factory output in November declined by a larger than seasonal amount after a ailing trend in production for about four months. This bank's preliminary IndeA of manufacturing activity dropped from 62 in October to a little over 57% of the 1923-1925 average in November, as compared with the decline in the national indicator from 65 to 63, both Indexes taking account of the number of working days and the usual seasonal fluctuation. This unfavorable comparison Is due chiefly to exceptionally large declines in the output of textile products, transportation equipment, and some of the important building materials. The iron and steel group, on the other hand, showed a decided Improvement; the decline in its production was much smaller than is ordinarily expected. so that the seaonsally adjusted Index number for the entire metal group rose by 2% between October and November. For the country as a whole, the level of activity of the Iron and steel Industry was also well maintained In the same period. Most of the individual lines of manufacture during November showed declines that were larger than usual, although in a few cases the changes Were comparatively small. Among those lines which registered improvement were the output of pig iron, steel works and rolling mills, foundries. motor vehicles, locomotives and cars, underwear, sugar, goat and kid leather, and by-product coke. Compared with a year ago, the rate of factory activity during November was 18% lower, whhe the decline throughout the country amounted to about 12%. Largely because of an exceptionally active period during the fall months, output of textile and leather products continued to exceed the volume In November 1931; but in other lines, the volume of production remained smaller, declines from a year ago ranging from 13% in food products to 51% for building materials. The average level of output in the first 11 months of this year was 23% lower than in the same period last year. Production of electric power was 4% larger in November than October after adjusting the figure for the number of working days and seasonal changes; the total output was less than 2% below the quantity of a year ago. For the 11 months this year, output of electricity was 7% less than In the same period last year. Total sales of electrical energy for all purposes showed a gain of 12% from October, the largest percentage Increases occurring in the consumption of electricity for residential and commercial lighting, for street cars and railroad power and for miscellaneous uses. Sales of electric power to In dustires also increased but not as much as they usually do in November; Industrial consumption of power was 12% smaller in the first 11 months this year than last. Recession Reported in Business Activity in Boston Federal Reserve District During November As Compared with October—Decreases Moderate, Although General Throughout Most Lines of Industry. The Boston Federal Reserve Bank, in its Jan. 1 "Monthly Review," states that "the level of general business activity in New England during November receded from that of October by more than the customary seasonal amount, but remained higher than the level prevailing during May, June and July." The Bank also notes as follows: Decreases in activity between October and November in this district were general throughout most lines of industry, but were moderate in extent. The amount of raw cotton consumed by New England mills was slightly smaller in November than in October, but in each of these months the volume was larger than in the corresponding month of 1931. A similar condition prevailed in the consumption of raw wool by New England mills. In the building industry further inactivity was reported during November, and in this district seasonally adjusted indexes representing the volume (square feet) of new residential building contracts awarded and the volume of new commercial and industrial contracts awarded stood at new low levels, the former at 19.5% and the latter at 11.7% of the 1923-1924-1925 average. The production of boots and shoes in New England during November was considerably lower than in October, but in September, October, and November the numbers of pairs produced exceeded those during the corresponding months last year. Carloadings of merchandise and miscellaneous freight in New England declined during November by slightly more than the usual amount from October, and were smaller in number during each of the first 11 months of 1932 than in those months a year earlier. According to the Massachusetts Department of Labor and Industries, during November the number of wage-earners employed in representative manufacturing establishments was 5.1% less than in October. The marked seasonal curtailment in boot and shoe manufacturing was a large contributory factor In the decline. The amount of aggregate weekly payroll was 8.0% smaller In November than in October and average weekly earnings per person employed dropped 3.1%. The amount of new ordinary life insurance written In New England during November was about 13% less than in November 1931, and during the first 11 months of 1932 was nearly 18% less than In the corresponding period last year. Registrations of new automobiles In New England for the 11 months from January through November were 43% less than In that period a year ago, although in November 1932, as compared with November 1931, there was a 28% decrease. Sales of New England reporting retail establishments in November were 18.3% less than in the corresponding month a year ago, and for the 11 months through November were 21.3% smaller. The decline in retail prices, which continued generally throughout 1932, would account for a considerable shrinkage in dollar volume, but the number of sales transactions also declined during 1932 as compared with 1931. Business Showed Little Change from October to November in Cleveland Federal Reserve District— Sales of Automobile Tires Below Year Ago—Somewhat Larger Than Seasonal Decline Noted in Retail Trade While Decline in Wholesale Trade Was Less Than During Past Years at This Season. "Little change in the general level of business was visable in the Fourth (Cleveland) Federal Reserve District from October to November," according to the Cleveland Federal 31 Reserve Bank,"though it appeared as if the upward movement recorded in the early fall months had about terminated." We also quote from the Bank's Jan. 1 "Monthly Review," from which the foregoing is taken, as follows: Preliminary data for the first three weeks of December show that a slightly more-than-seasonal contraction was felt in that period by some unusual of the more Important lines of trade and industry, though several factors were present which might account for the declines. Unfavorable weather no doubt retarded retail trade, building, &c. Bank debits in this district in November expanded by considerably year. more than the usual seasonal amount and the reduction from last months 26% was much smaller than the falling off recorded In the first 10 were less of the year when they were down 36%. Commercial failures numerous in November than in October and liabilities of the defaulting concerns were down sharply, both from the preceding month and November 1931. There was an increase of one in the number of banks in December, there being three openings during the month and only two suspensions. Production of steel ingots at plants in this district was maintained in November by orders from the automobile industry which expanded output considerably, largely through the introduction of new models. In December, a contraction in steel operations occurred, though production of Fourth District factories In the third week of the month was still somewhat above the level for the entire country. Building operations in November expanded, contrary to the seasonal movement of past years, chiefly as a result of the awarding of Government contracts. In the first half of December a sharp reduction was recorded. Coal production of Fourth District mines was greater in November than a year ago, and, though output for the entire year was down sharply from 1931, considerable improvement in this industry developed in the last half of the year. Though the general level of business In 1932, in this District as well as in the entire country, as reflected by employment, payrolls, bank credit, retail trade, and industrial production, was at the lowest point in many years, possibly lower than for any 12-month period in the present century. as the new year begins it is quite certain that, despite the recession in late November and December, a large part of the improvement from the low point touched some time last summer has not been surrendered. The "Review"contained the following regarding the rubber and tire industry in the Cleveland District: According to reports. November replacement tire sales were considerably below a year ago, but the reduction in original equipment sales was somewhat smaller because the automobile industry began producing 1933 models in that month and continued to expand in December. Rubber consumption in November, at 21,910 tons, was aoout 900 tons greater than in October, but still about 500 tons below a year ago. Imports of crude rubber in November were 27,080 long tons, a decrease of 24 and 38%. respectively, from October 1932, and November last year, but they exceeded consumption. Crude rubber stocks on the latest date were about 30% above a year ago. The report from the Rubber Manufacturers' Association, which covers about 80% of the industry, shows that tire production in the first 10 months of 1932 was 18% below the same period of 1931. The tire industry began to feel seriously the effects of the depression this year when gasoline production turned downward and registrations of automobiles showed a declining tendency. Normally, at this season, tire manufacturers are expanding operations as a result of orders placed in the fall months, but this year the dealer who ordinarily placed a fairsized spring-dated order is buying on a strictly hand-to-mouth basis, a thing which no doubt will affect the monthly volume for some time to come. Dealers' inventories are being held at low levels now, in keeping with sales, after having increased in June and September when price changes were announced. The price situation is still unfavorable and disturbing. The price of crude rubber has declined from more than a dollar a pound in 1926 to a little more than three cents a pound at the end of 1932, the drop in the past year being over 25%. Cotton prices also declined sharply in 1932. This has caused manufacturers to lose on their inventories and dealers to lose on stocks as their merchandise declined in value. In other Drenches of the rubber industry, the boot and shoe producers enjoyed quite a successful year, the first in four, but foreign competition has been a disturbing factor in this line. The mechanical goods division held up fairly well in the past year, but the reduction in rubber consumed by manufacturers of these articles in the first nine months of 1932 from the same period of 1931 was only slightly less than the 11% decline in consumption by the tire industry. Retail. As to wholesale and retail trade conditions the "Review" noted as follows: Though there usually Is a slight reduction in department store sales from October to November,the falling-off in the latest month was somewhat greater than seasonal, and the adjusted index of daily average sales was 56.2% of the 1923-25 monthly average, compared with 57.6% in October. Asshown on the chart. [This we omit.—Ed.], however,it was still above the low point touched in August. Compared with a year ago, November dollar sales were down 22% and the contraction continued in December, Judging from preliminary reports. In the first three weeks of Christmas buying, sales were about 30% below the same period of 1931. whereas the decline in dollar sales in the first 11 months was 26.5%. Store executives report that the number of sales have held up fairly well, but that people are buying in lower price classes than in former years and the general reduction In prices in the past year, which, according to Farichildli index, was approidmately 15%, is the cause of a large part of the discrepancy in the dollar value of retail sales from 1931. In the various cities the smallest declines, about 18%, were shown at Akron, Cincinnati. Columbus and Wheeling in November; Pittsourgh experienced a greater than average reduction. stocks Although normally there Is a slight increase in the dollar value of from October to November, the expansion in the latest month was a little more than sea.,onal and the adjusted index rose to 57.6% of the 1923-25 monthly average. The value of stocks was 23% below a year ago. The ratio of November sales to average stocks was the same as in November last year. As in earlier months this year, proportionately more sales were for cash than in 1931 and there was a reduction in instalment buying. An improvement in collections was evident in November, the ratio of collections during the month to accounts receivable on Oct 31 being greater than in October or in November 1931. Sales at retail furniture stores were down 33% in November from a year ago and the decline in the 11 month period was 39.2%. Wearing apparel store sales were off 22.5 and 29% in November and the first 11 months from similar periods of 1931. 32 Financial Chronicle Chain grocery and drug sales in November, per unit operated, were down 3.6 and 13% from last year and the reductions In the first 11 months were 8.6 and 13.4%. repectively. Wholesale. lir Although sales of goods at wholesale in the four reporting lines declined slightly from October to November, the falling-off was less than was reported in past years at this season. The dollar volume, however, was about half the average monthly sales of the three years, 1923-25. In the individual lines, sales of dry goods and hardware were most depressed in November and the 11-month period, compared with a year ago, as well as compared with the 1923-25 base period. Grocery sales were 16% smaller In November and off 22% in the 11 months from similar periods of 1931. The best relative showing in the wholesale field in November. as well as in the entire year, was shown by drug concerns, whose sales were down 10% in the month and 16% in the 11 months from corresponding periods of the preceding year. Further Recessions in Trade and Industry in Eighth District Noted by Federal Reserve Bank of St. Louis-Lowest Point of Year Reached by Some Important Lines During Late November and Early December. "Trade and industry in the Eighth (St. Louis) District during the past 30 days developed further recessionary trends, and during late November and the first weeks of December activities in a number of important classifications reached the lowest point of the year. In all wholesaling and jobbing lines investigated by this Bank," states the Federal Reserve Bank of St. Louis in its "Monthly Review" of Dec. 31, "the volume of November sales fell below that of the preceding month, and with the exception of furniture, which registered a moderate gain, the volume was measurably below that reported in November last year." The Bank also stated: As compared with a year ago decreases were most marked in the heavier Industries, including iron and steel, glass, lumber, and the entire category of building materials. The movement of seasonal merchandise was considerably below the usual volume at this time of year. Purchasing of raw materials was on a very limited scale, being affected by slackness in demand for finished goods, and a general desire on the part of manufacturers to hold down stocks against the inventorying period. The continued decline In commodity prices was a further influence tending to restrict commitments, particularly for goods to be used in future operations. In all quarters ordering was confined to materials to fill immediate and well defined requirements. In the South both wholesale and retail trade was adversely affected by the decline in prices of cotton and rice, while low market levels of cereals, live stock and other farm products served to greatly reduce purchasing power elsewhere in the agricultural sections. Christmas shopping got under way later than usual, and reports covering the first half of December Indicate a considerably narrower outlet through this channel than during the past several years. As has been the case throughout the year, demand for merchandise centers chiefly in necessities and the cheaper classes of goods. Distribution of automobiles in November decreased sharply as compared with the preceding month and a year ago, and the total sales of dealers reporting to this bank were the smallest for any single month in more than 10 years. More than the usual seasonal contraction in operations at iron foundries and steel mills took place in late November and early this month. Numerous stove plants closed down and there was further curtailment at plants of farm implement manufacturers and other specialty makers. As compared with the preceding 30 days the only changes in the agricultural situation were of a seasonal character. The United States Department of Agriculture's report as of Dec. 1 in the main confirms forecasts of yields of the chief crops made earlier in the season. For the most part reports relative to fall-planted cereals reflect favorable conditions. Heavy snows over the principal winter wheat areas afforded ample covering and protection for that crop. No improvement took place in the employment situation as a whole. Incident to the holiday trade, retail establishments augmented their forces, and there were gains in employment in the tobacco district where the new crop Is being marketed. The increased number of workers in these occupations, however, was more than offset by decreased employment among other groups of wage-earners. As reflected in sales of department stores in the principal cities of the District, the volume of retail trade in November was 1.8% smaller than In October, and 20.8% less than in November 1931; for the first 11 months this year cumulative sales were 22.5% smaller than for the comparable period in 1931. Combined sales of all wholesaling and jobbing interests reporting to this Bank in November showed a decrease of 15% under October and of 18% under the November 1931 total; for the 11 months this year cumulative sales of these firms were approximately one-fourth less than for the same period last year. The dollar value of permits issued for new construction in the five largest cities of the District in November was 80% smaller than in October and 58% less than in November 1931; for the first 11 months the total was 76% smaller than for the comparable period last year. Construction contracts let in the Eighth District in November were 26.4% larger than a month earlier, and 53.9% more than in November 1931; for the first 11 months this year the cumulative total was 49.4% smaller than a year ago. Debits to checking accounts in November showed a decrease of 11% and 22%, respectively, as compared with a month and a year earlier, and for the 11 months this year the total was one-fourth less than for the comparable period In 1931. Officials of railroads operating in this District report a decrease in freight traffic during November and early December of somewhat larger than the usual seasonal proportions. The low stage of demand for industrial fuel Is reflected in an unusually small movement of coal and coke. Heavy decreases as contrasted with the same time in recent years was noted in loadings of grain and grain products. For the country as a whole, loadings of revenue freight for the first 48 weeks this year, or to Dec. 3, totaled 26,255,457 cars, against 35,012,832 cars for the corresponding period in 1931 and 43,107.709 cars in 1930. The St. Louis Terminal Railway Association, which handles interchanges for 28 connecting lines, interchanged 109.611 loads in November, which compares with 133,066 loads in October and 132,895 loads in November 1931. During the first nine days of December the interchange amounted to 42,620 loads, against 35,189 loads during the same period in November and 40.976 loads during the first nine days of December 1931. Passenger traffic of the reporting Ian. 7 1933 lines in November decreased 37% as compared with the same month In 1931. Estimated tonnage of the Federal Barge Line between St. Louis and New Orleans in November was 112,300 tons, as against 109,442 tons actually handled in October and 86.348 tons in November 1931. The same general trends which have been noted since early tall were reflected in reports relative to collections during the past 30 days. Considerable spottiness exists, both in the large cities and rural sections. Universally collections on new accounts are reported fair to good, but backwardness is still noted on debts of long standing. Nov. 1 settlements with wholesalers in the large distributing centers were well up to exepctations, in a number of instances being ahead of the same period last year. In the tobacco districts, where markets for the 1932 crop have opened, there has been considerable liquidation, and, slight improvement in collections in the rice areas is noted. As contrasted with last spring and summer, there has been substantial improvement in payments in the bituminous coal sections. Due to a closer credit policy of merchants generally, the ratio of cash sales to credit sales has increased markedly in recent months. Alberta Farmers Would Consider Formation of National Wheat Board and Other Proposals. The following (Canadian Press) from Edmonton, Alta., Dec. 31, is from the New York "Times": Early conference on formation of a national wheat board, tying of the Canadian dollar to exchange of wheat-exporting countries, Dominion survey of wheat production and marketing and placing of Canadian trade agents in wheat-consuming countries were proposals approved at the United Farmer Conference here, according to a statement issued to-day by Premier J. E. Brownlee. Another proposal of the conference is that a conference of the chief wheat exporting countries should be held. The delegates also expressed themselves as in favor of exploration by Canada of the possibilities of bartering wheat for the products of wheat-consuming countries. To carry out such a plan, trade representatives would be placed in other countries. Review of Industrial Situation in Illinois by Indusrty During- November by Illinois Department of Labor -Employment and Payrolls Loweras Compared with October. "Reports from 1,465 industrial establishments in Illinois showed decreases from October to November of .4 of 1% in employment and 3.6% in payrolls," according to Howard B. Myers, Chief of the Division of Statistics & Research of the Illinois Department of Labor. "These decreases," continued Mr. Myers in reviewing the industrial situation in Illinois, "were more moderate than the declines experienced between these two months in the years 1930 and 1931. They compare unfavorably, however, with the percentage changes between these months in the years 1922 through 1928 which show an average increase of .7 of 1% in employment and of .5 of 1% in payrolls." Under date of Dec. 16, Mr. Myers also noted: The downward movement during November this year was the result of losses in the manufacturing division of 1.6% in employment and 7.5% in payrolls. The non-manufacturing division reported a total gain of 1.4% In the number of wage earners and of .9 of 1% in total wage payments. Employment in all reporting industries, while lower than in October, remained above the levels reported in the months. July through September 1932. Payrolls, however, declined to a point lower than in any preceding month except July 1932. While all but one of the nine main manufacturing groups contributed to the 7.5% decrease in factory payrolls, only four of the groups contributed to the 1.6% decline in employment. These four groups were stone, clay and glass products, chemicals, oils and paints, clothing and millinery, and food, beverages and tobacco. The printing and paper goods group reported gains of 2.1% in employment and 1.1% in payrolls, although only two industries within this group-miscellaneous paper goods, and edition bookbinding-showed increases for both employment and payrolls. The four remaining groups of the manufacturing industries showed increases in employment ranging from .1 of 1% in textiles to 2% in wood products; and decreases in payrolls ranging from 3.5% in metals, machinery and conveyances, to 9.4% in wood products. In the stone, clay and glass products group, one of the four In which both employment and payrolls declined, the losses were 6.6% in employment and 5% in payrolls. All industries within this group shared in the reduction In employment and all but glass factories, in the decline in payrolls. In the chemicals, oils and paints group, employment increased in two industries, drugs and chemicals, and paints, dyes and colors, but decreased in the mineral and vegetable oils, and miscellaneous chemicals industries. The chemicals group as a whole showed an employment loss of .4 of 1%. Payrolls decreased in all industries in the group: the loss in payrolls for the group as a whole was 5.8%. The clothing and millinery group reported decreases of 3.9% in employment and 34.5% in payrolls. The decline in payrolls was greatly in excess of the customary downward movement at this time of the year. Only one Industry In this group, women's clothing, showed a gain in employment and only the overalls and work clothes industry reported a rise in payrolls. The food, beverages and tobacco group decreased employment 6.3% and payrolls 12.2%, with all but two of the 11 Industries In this group contributing to the decreases. Beverages, and cigars and other tobacco products showed increases in both the number of wage earners and In total wage payments. Thirteen slaughtering and meat packing establishments showed a .9 of 1% decrease in employment and a 6.7% reduction in total wage payments. Sixteen confectionery plants reduced employment 12.7% and payrolls 29.6%. This industry had been responsible for a large share of the increases in the food products group during August and September. The largest decrease reported was in the fruit and vegetable canning industry, which showed losses of 47.7% in employment and 39.4% in payrolls. Other food industries in which operations declined extensively, were flour, feed and cereals, manufactured ice, and ice cream. An increase of .3 of I% in employment, accompanied by a decrease of 3.5% in payrolls, was reported in November by 377 establishments in the metals, machinery and conveyances group. Four of the 13 industries in this group-iron and steel, sheet metal work and hardware, tools and cutlery. and electrical apparatus-reduced both employment and payrolls, Four other Industries of this group-cars and locomotives, automobiles and accessories, agricultural implements, and "all other" metals-showed gain' Volume 136 Financial Chronicle in both employment and payrolls, while the remaining five industries increased employment but reduced total wage payments. The wood products groups showed an increase of 2% in employment with a decrease of 9.4% in payrolls. Furniture and cabinet work, the largest of the industries In this group, showed a decrease of 1.1% in number of wage earners and of 13.5% in total wage payments. In the furs and leather group, all but the miscellaneous leather goods industry contributed to a rise of 1.8% in employment while boots and shoes, as well as miscellaneous leather goods contributed to a 6.4% drop In payrolls. A slight rise of .1 of 1% in employment in the textiles group was caused by the employment of additional wage earners in two industries, knit goods, and thread and twine; the increases in employment in these industries offset the layoffs in mills making cotton and woolen goods and miscellaneous textiles. Payrolls in the textiles group showed a decrease of 5%, with all industries except thread and twine sharing in this decline. In the non-manufacturing division, gains of 1.4% in employment and .9 of I% in payrolls during November continued the upward movement noted in October. Coal mining, however, was the only one of the five main groups of non-manufacturing industries which increased both employthe ment and payrolls. Twenty-nine mines reported increases of 31.3% in wholenumber of wage earners and 10.2% in total wage payments. The barely sale and retail trade group also increased employment, 2.9%, but group, maintained payrolls at the level of the preceding month. In this digdepartment stores, wholesale dry goods, wholesale groceries, and milk Mail order distributing showed losses in both employment and payrolls. both houses, however, showed a substantial increase in employment, and payments. these and metal jobbing establishments showed larger total wage employing Public utilities, represented by 64 reporting establishments employment from 66,770 wage earners, showed a decrease of .5 of 1% in railways October to November but an increase of 1.2% in payrolls. Street payrolls. Railand railway car repair shops were responsible for the rise in was more than way car repair shops also increased employment but this gain the services offset by losses in the other public utilities classifications. In a loss of .1 of payrolls group. employment showed a decrease of 1.2% and loss in employ1%. Forty-seven hotels and restaurants reported a 1.1% Twenty-two launderment and a .4 of 1% increase In total wage payments. reductions in employing, and cleaning and dyeing establishments reported and contracting ment of 1.7% and in payrolls of 3.3%. The building 7.5% in industry, represented by 252 reporting firms, showed decreases of construction were employment and 11.2% in payrolls. Building, and road contracting responsible for these decreases, since Increases in miscellaneous were reported during November. that reducOf the total of 1,465 reporting establishments only 21 stated month. The tions in wage rates had been put into effect since the preceding affected reductions which ranged from 4% to 27% but were typically 10%. reported. 1.626 wage earners, or .6 of 1% of the total number of wage earners mines Three of the 21 establishments reporting wage reductions were coal mines which resumed operations on the lower wage scale. These three employed 875 of the 1,626 wage earners affected by the reductions. figure This k Weekly earnings in all reporting industries averaged $19.96. reporting represented the lowest value for average weekly earnings in all Industries in the series recorded by the Department of Labor, beginning male with July 1022. In November 1932, the average weekly earnings for manuwage earners were $22.05 and for female wage earners. $13.23. The figure a $16.95. facturing division reported average weekly earnings of -manufacturing lower than the average of $24.52 reported by the non 40.3 industries. Average weekly operating schedules, however, were hours in the hours in the non-manufacturing division, as against 37.8 gave which manufacturing division, according to reports from those firms practiinformation on operating schedules. Operating schedules averaged division, but cally the same for men and for women in the manufacturing 48.1 in the non-maufacturing division women worked on an average of hours a week and men 39.3 hours a week. In the non-manufacturing men for and division the average weekly earnings for women were $16.22 $27.57. In the manufacturing division weekly earnings averaged $19.43 for the male wage earner and $10.70 for the female wage earner. On Dec. 15, Mr. Myers issued his review of the industrial situation in Illinois by cities as follows: Decreases of 1.6% in employment and 7.5% in payrolls from October to November 1932, were reported by 972 Illinois manufacturing establishments. These reported decreases were more moderate than those which occurred between October and November 1931, but were considerably larger than the average decreases of .2 of 1% in employment and .9 of 1% in payrolls experienced during the years 1922-1928. Inclusive. The November decline brought factory employment down to the level reached in August 1932, which was, with the exception of July 1932, the lowest month on record. Total wage payments in November stood at a point slightly above the July 1932, figure. but lower than any other month for which records are available. In Chicago factories, which employed about three-fifths of the total number of wage earners reported, employment fell below that of any preceding month except July, 1932, while total wage payments reached the lowest point yet recorded. Of the 15 cities for which figures are complied separately, six-Moline. Peoria, Rockford, Rock Island, Springfield and Sterling-Rock Fallsmoved counter to the prevailing tendency in November. and Increased both factory employment and total wage payments by substantial amounts. Two cities, Decatur and East St. Louie, employed additional wage earners but decreased total wage payments, and two others. Aurora and Quincy, reduced employment but showed larger payrolls. Reporting factories In the "all other" cities showed a 3% decrease in employment and a 6.7% loss in payrolls. The entire State. however, exclusive of the Chicago area, reported a slight gain in employment of .2 of 1%. and a decrease in payrolls of 4.3%, a percentage decline which was considerably smaller than the decline in payrolls in the State as a whole. Employment continued to increase in the coal mining sections of the State, although the differences between the two organizations of union miners have not yet been adjusted. Road construction work is gradually decreasing. The Division of Highways of the Illinois Department of Public Works and Buildings reported a total of 18,547 men engaged In In highway construction during November, as compared with 21,410 of October. The free employment offices of the State reported a total 154.8 registrations to every 100 positions open during November. as against 170.4 in October. Aurora.-Employment decreased 1.6% while payrolls increased 3.9% in in the 15 reporting factories of this city. Increases in total wage payments two metals group more than offset the losses in a paper concern and In clothing manufacturing plants. The ratio of registrations to every 100 as November. positions open at the free employment office was 223.3 in against 226.1 in October. Bloomington.-Lossos of 29.9% in employment and 33.8% in payrolls were reported by 10 factories of this city. The decreases were largely the result of declines in the metals and food products groups, although there were less marked decreases in a printing establishment. The unemploy- 33 ment ratio at the free employment office was 165.7, as against 153.7. the previous month. Chfcago.-Reports from 488 factories of this city Indicated that industrial operations had decreased sharply from October to November. Employment declined 2.8% and payrolls, 9.2% over this period. Only one main Industrial group, printing and paper goods, reported gains in both employment and payrolls. Two other groups-furs and leather goods, and chemicals, oils and paints-increased the number of wage earners but decreased in payrolls, while the remaining six groups showed substantial reductions payments. both the number of wage earners employed and in total wage The losses In employment ranged from 1% in the metals. machinery and reductions conveyances group, to 9.4% in clothing and millinery, and the in payrolls. from 1.2% in furs and leather goods to 38.3% in the clothing the wood in and millinery group. Thirty-three reporting establishments products group, mainly furniture factories. decreased employment 3.6% and payrolls 18%. Seventy-five food products establishments reported losses of 4.7% in employment and 12.5% in total wage payments. These Industrial groups, with the clothing and millinery group, were those most severely affected by the November decline. The free employment offices of the city reported a decline in the ratio of registrations to every 100 positions open, from 247.7 in October, to 232.9 in November. Cicero.-Eleven factories in this city reported a decline in employment of of 3.4% and a decrease in payrolls of 22 3%. Six establishments in the metals group were largely responsible for these reductions. The free employment office of this city reported an unemployment ratio for November of 176.3, a figure considerably lower than the ratio of 207.5 reported in October. Danrille.-Decreases of .9 of 1% in employment and 5.2% ha payrolls, which were reported in November by 11 factories of this city, partially offset the Increases that were reported the preceding month. Metals, wood products, and food products were responsible for the November decreases. The free employment office reported an unemployment ratio of 210.8 in November, as against 242.8 in October. Decatur.-Eighteen factories reported in increase in employment of 18.4% with a decline in payrolls of 7.8%. The temporary employment of a large number of women in a garment factory raised the employment figures without causing a corresponding gain in payrolls. Shorter time schedules in the metals and food products groups also contributed to the loss in payrolls. while employment showed an increase in the metals group, and remained stationary in the food products group. The unemployment ratio declined to 185.1 in November from a ratio of 224.6 in the preceding month. East St. Louis.-Twenty-two reporting factories in this city increased employment0.08% while reducing payrolls 3.7%. Metals and wood products groups reported increases in payrolls, but these gains were offset by losses in every other reporting industrial group, except miscellaneous manufacturing. Two of the groups-stone, clay and glass, and chemicals, oils and paints-showed losses in employment as well as in payrolls. The unemployment ratio for this city declined slightly, from 117.6 in October to 113.6 in November. Joliet.-Decreases of 0.1 of 1% in employment and 8.7% in payrolls were reported by 25 factories of this city. A large share of the losses were contributed by a chemical roofing establishment. Fifteen establishments In the metals group showed moderate gains in both employment and payrolls. The unemployment ratio increased from 262.7 in October to 288.0 in November. Moline.-Marked increases of 22.8% in employment and 20.9% in payrolls were reported by 17 factories in this city. Two plants representing the stone, clay and glass products group, remained closed and two establishments in the food products group showed decreases In both employment and payrolls. The remaining three industrial groups-metals, wood products, and paper and printing-added wage earners and increased payrolls. As fewer than 100 positions were available at the free employment office, the unemployment ratio has not been computed. Peoria.-Thirty-two factories of this city reported substantial Increases from October to November of 15 2% in employment and 5.6% in payrolls. Practically all reporting industrial groups contributed to these gains. The exceptions were the wood products group, which showed reductions in both number of wage earners and in payrolls, the chemicals, oils and paints group, which showed slight reduction in payrolls but not in employment, and the food products group, which decreased employment while Increasing payrolls. Registrations for work at the free employment office totaled 136.5 to every 100 places available in November. as compared with 141.3. In October. Quincy.-Twelve reporting factories of this city decreased employment 0.7 of 1% but increased payrolls 5.1%. Metals shops, paper and printing establishments, and clothing factories contributed to the gain in payrolls. The unemployment ratio at the free employment office in November was 104.9, as against 109.9 in October. Rcokford.-GaIns of 2.9% in employment and 3.6% in payrolls were reported by 42 factories of this city. This Is the third consecutive month during which employment has moved upward and the second during which payrolls have shown a gain. The November increases were contributed by the metals, wood products, fur and,leather goods, and printing and paper goods groups. The unemployment ratio at the free employment office declined to 150.3 in November from a figure of 160.3, in the preceding month. Rock Island.-Nine reporting factories in this city increased employment 8.9% and payrolls 10.7% from October to November. Payrolls have shown increases In every month since last July, and are now about on a level with those reported last March. The volume of employment Is still somewhat lower than last March but is higher than in any month since that time. Five metal shops and a wood products establishment were mainly responsible for the increases reported in November. As the number of positions available at the free employment office was less than 100. the unemployment ratio has not been computed. 1, Springfield.-Gains of 22.4% in employment and 21.8% in payrolls were reported for November by 12 factories of this city. A shoe factory reemployed nearly as many wage earners as it had laid off in October. Fire metal shops also reported gains, especially in payrolls. The free employment office reported an unemployment ratio of 115.6, as against 126.5 in October. Sterling-Rock Falls.-Employment and payrolls continued to increase in 13 reporting factories in this city. The gains for November amounted to 6.4% in employment and 6.3%, in payrolls. All of the reporting industrial groups shared in the rise in payrolls while metals alone contributed to the gain in employment. Alt Other Cities.-Decreases of 3.0% in employment and 6.7% in payrolls were reported by 235 factories in this group of cities. All of the reporting industrial groups shared in the loss in payrolls and all but wood products, textiles, and clothing and millinery, shared In the decline in employment. Metals, machinery and conveyances decreased employment 0.4 of 1% and reduced payrolls 3.9%. The food products group, which showed losses of 21.3% in employment and 11.7% in payrolls, was responsible for a large share of the reported decreases. Losses exceeding 10% in payrolls were \MENNEMIIIMMI 34 Financial Chronicle Jan. 7 1933 shown also by the printing and paper goods, wood products, and the furs and leather goods groups. Stocks on hand at softwood mills on Dec. 31 were the equivalent of 75 days' average production of the reporting mills, compared with 108 days' average production on Jan. 2 1932. The following statistics were also issued by Mr. Myers: Forest products carloadIngs during the week ended Dec. 24 showed EMPLOYMENT. PAYROLLS AND AVERAGE WEEKLY EARNINGS IN slight increase over the all-time low record of the previous week. For rwicois. NOVEMBER 1932. 51 weeks of 1932 these loadings were 39% below those of similar period of 1931. EMPLOYMENT. PAYROLLS. Lumber orders reported for tho week ended Dec. 31 1932, by 423 softIndex of Index of wood mills totaled 74.352,000 feet, or 42% above the production of the Average Per Employment Per Payrolls Weekly same mills. Shipments as reported for the same week were 74,436,000 Industry. Cent (Monthly Cent (Monthly Earnings feet, or 42% above production. Production was 52.538,000 feet. Change Average Change of Average Reports from 374 hardwoods mills give new business as 10,798,000 feet, Oct. 15 1925-27=100) Oct 15 1925-27=100 Erato to or 70% above production. Shipments as reported for the same uloyees week Nov. 15 Nov. Nov. Nov. 15 Nov. Nov. Nov. 15 were 10,894,000 feet, or 71% above production. Production was 6,353,000 1932. 1932. 1931. 1932. 1932. 1931, 1932. feet. All industries -0.4 58.4 68.1 -3.6 37.4 52.3 819.96 Unfilled Orders. All manufacturing Indus -1.6 53.5 62.3 -7.5 30.1 43.2 16.95 Reports from 358 softwood mills give unfilled orders of 316,610,000 feet Stone. clay, glass -6.6 40.6 50.4 -5.0 21.6 32.1 17.41 on Miscell. stone, mineral_ -15.2 44.7 56.3 -21.7 21.6 35.0 Dec. 31 1932, or the equivalent of nine days' production. The 331 19.78 Lime, cement, plaster.... -3.5 45.6 41.4 identical softwood mills report unfilled orders as 310.627,000 feet on Dec. 31 -5.6 19.8 25.1 16.42 Brick, tile, pottery...... -6.6 26.7 36.3 -4.0 10.8 19.0 14.69 1932, or the equivalent of nine days' average production, as compared with Glass -3.9 58.9 72.2 +3.1 53.4 74.5 18.23 354,838,000 feet, or the equivalent of 10 days' average production on Metals. mach'y,convey'ces +0.3 41.9 58.0 -3.5 20.4 35.1 16.30 Iron and steel similar date a year ago. -0.9 57.6 69.4 -2.0 24.5 40.1 13.35 Sheet metal w'k, hardw_ -0.2 50.6 64.9 -1.4 41.2 61.6 Last week's production of 384 identical softwood mills was 50,665.000 15.73 Tools. cutlery -7.7 29.1 55.2 -12.9 11.8 27.4 15.30 feet, and a year ago it was 57,726,000 feet; shipments were respectively Cook'g & heat'g appar_ +1.4 50.2 63.6 -2.6 20.7 28.8 15.59 Brass, cop., zinc & other +0.3 52.2 66.0 71.821,000 feet and 100,903,000; and orders received 72.128,000 feet -5.6 28.6 43.9 18.15 Cars,locomotives and 86,871,000. In the case of hardwoods, 194 identical mills reported +2.1 7.1 12.8 16.14 +2.3 8.4 4.0 Automobiles, accesories +4.9 35.9 58.1 20.74 +6.0 27.3 39.4 production last week and a year ago 5,066.000 feet and 6,866,000; shipMachinery +1.9 46.8 58.5 -3.0 30.4 44.6 17.75 ments 8,242,000 feet and 12,224.000; and orders 8,468.000 feet and Electrical apparatus_ _ _ -2.0 31.4 58.9 -11.6 11.8 27.5 20.82 Agricultural implements +6.9 40.9 43.4 +11.5 19.7 25.7 10,372,000. 15.28 Instruments & appITces +0.4 43.5 51.6 -2.6 19.7 30.2 19.36 West Coast Movement. Watches, Jewelry +1.5 38.8 64.4 16.14 -0.4 27.3 46.3 The West Coast Lumbermen's Association wired from Seattle the folAll other +18.3 --------+80.3 --------21.75 Wood products lowing new business, shipments and unfilled orders for 217 mills reporting +2.0 35.0 44.6 -9.4 19.2 30.9 13.28 Saw-planing mills -4.2 30.6 43.0 -12.3 12.6 24.1 for the week ended Dec. 31' 14.34 Furn., cabinet work__ -1.1 36.0 47.6 -13.5 18.4 30.4 12.72 Pianos. musical lnstr'ts. +1.5 21.6 26.7 +17.4 14.3 15.3 22.98 M toren. wood products. +14.4 47.0 47.5 -7.1 20.9 30.1 11.41 Furs and leather goods +1.8 85.3 62.5 -6.4 41.2 29.9 11.21 Leather +1.9 100.2 100.3 +0.2 79.6 81.8 21.81 Furs, fur goods Boots and shoes +1.8 77.9 58.8 -8.9 34.3 21.0 9.19 Miscell. leather goods -1.5 33.8 30.1 -13.1 22.2 23.8 13.94 ZihemicaLs, oils, paints... -0.4 68.4 76.9 -5.8 51.8 66.7 19.98 Drugs, chemicals +1.6 62.6 68.0 -0.5 43.6 54.5 17.43 Paints, dyes, colors_ _ +1.3 65.9 71.4 -10.4 56.6 74.4 20.03 Mineral & vegetable oil.. -0.6 69.2 77.1 -3.7 64.0 80.9 23.46 Miscellaneous chemicals -2.966.2 77.4 -10.6 39.3 53.3 15.50 Printing and paper goods_ +2.1 72.0 82.3 +1.1 42.8 56.4 25.14 Paper boxes, bags, tubes +2.3 74.8 78.4 -5.7 42.1 52.8 18.77 Miscell. paper goods +5.0 80.1 83.3 +5.0 59.4 75.4 18.23 Job printing +1.8 50.7 61.1 -0.4 24.1 31.1 24.26 Newspapers, periodicals -1.2 83.0 92.3 +3.1 61.3 77.4 36.78 Edition bookbinding... +7.1 --------+15.1 --------30.34 Lithographing & engrav -0.6 ---------5.8 --------25.81 Textiles +0.1 70.4 74.6 -5.0 59.9 69.9 15.37 Cotton, woolen goods -2.6 91.7 101.1 -7.0 96.9 116.8 19.17 Knit goods +7.2 72.4 78.9 -0.4 71.1 82.2 13.20 Thread and twine +6.2 62.9 60.3 +27.7 55.3 55.5 15.10 Miscellaneous textiles -9.5 85.7 85.1 -18.8 51.2 61.7 14.03 "Mottling and millinery..... -3.9 65.1 63.7 -34.5 22.1 34.7 9.20 Men's clothing -8.3 56.0 58.3 -44.4 18.5 31.8 9.38 Men's shirts, furnishings -0.7 61.5 71.2 -6.5 46.8 63.1 12.46 Overalls, work clothes.._ -0.7 24.3 21.7 +8.4 25.0 22.9 8.28 Men's hats, caps -53.0 ---------49.0 --------16.18 Women's clothing +10.7 83.2 63.3 -17.4 25.7 30.0 6.81 Women's underwear_ 0.0 109.5 85.6 -10.3 79.7 81.9 13.27 Women's hats -20.3 ---------51.1 --------7.47 raid. beverages, tobacco_ -6.3 77.1 72.9 -12.2 53.5 65.6 18.44 Flour, feed, cereals._ -16.4 69.9 78.4 -29.2 53.3 68.8 20.42 Fruit, vegetable canning -47.7 38.2 43.9 -39.4 24.9 33.0 10.55 Miscellaneous groceries_ -8.5 71.2 80.4 -9.1 56.8 70.6 23.55 Slaughtering, meat pkg. -0.9 82.1 85.9 -6.7 65.4 83.6 19.60 Dairy products -3.0 80.1 90.8 -4.2 65.0 86.5 27.98 Bread, other bak'y prod. -2.0 57.6 68.0 22.22 -7.3 50.3 59.4 Confectionery -12.7 119.5 69.0 -29.6 48.0 54.0 10.91 Beverages 66.6 79.0 +23.1 +6.7 43.1 61.9 21.14 Cigars, other tobaccos... +25.7 48.6 71.1 +16.6 36.6 57.1 12.93 Manufactured ice -27.4 49.0 67.4 -26.4 82.6 105.4 40.11 Ice cream -13.1 ---------17.5 --------29,39 discell. manufacturing.. -3.9 ---------5.1 --------16.08 7on-manufactur1ng Indus_ +1.4 --------+0.9 --------24.52 7rade--Wholesale & retail +2.9 55.3 62.9 -0.0 45.8 58.9 22.82 i Department stores -0.5 83.8 97.3 -1.2 73.8 99.8 19.01 Wholesale dry goods -1.1 65.7 71.7 -8.1 55.8 60.8 19.95 Wholesale groceries.. -1.5 55.4 75.7 -0.7 55.7 70.9 27.35 Mail order houses +9.4 50.0 54.2 +1.2 32.4 43.8 16.56 I Milk distributing 'Metal Jobbing ;ervices -1.2 ---------0.1 --------15.94 , Hotels and restaurants. -1.1 --------+0.4 --------16.05 ,Laundries -1.8 73.5 87.9 15.22 -3.3 51.9 73.8 'ublic utilities -0.5 74.9 86.2 +1.2 66.6 90.3 26.90 Water,gas, light & pow_ -3.2 77.0 111.7 32.26 -0.7 35.7 53.9 Telephone -0.4 88.3 95.3 -1.5 76.4 104.8 22.35 Street railways -1.3 74.9 82.6 +2.4 86.8 105.9 31.74 Railway car repair +6.3 46.8 48.0 +12.9 51.9 70.9 21.21 ion' mining +31.3 72.9 75.6 20.01 +10.2 32.1 30.3 luilding. contracting._ _ _ -7.5 15.4 26.5 -11.2 13.1 26.3 22.31 Building construction -11.3 10.0 21.9 -13.0 7.4 21.5 26.20 Road construction -23.6 295.1 137.3 -29.2 517.4 190.1 17.33 Miscell. contracting...... +35.2 21.5 11.5 +23.3 16.7 12.8 21.27 Lumber Industry Reports Lowest Weekly Production on Record-Orders Slightly Over Last Week's. The lumber mills closed the year with the lowest production reported for any week in the 17 years during which the National Lumber Trade Barometer has been issued, according to telegraphic reports to the National Lumber Manufacturers Association from regional associations covering the operations of 783 leading hardwood and softwood mills. Production was 30% below the previous week and totaled 58,891,000 feet. New business during the week at 85,150,000 feet was only about 3% lower than the week before. Production was 12% of capacity and new business was 17% of capacity, compared with 16% and 17% respectively the week previous, added the National Lumber Manufacturers Association, which further reported as follows: All associations reported new business greatly in excess of production. In the Western pine region orders were nearly double the output. Compared with corresponding week of last year all regions showed decline in production and also in new business, the latter dropping to 17% below similar week of 1931. NEW BUSINESS. Feet. Domestic cargo __ Export Rail Local Total UNSHIPPED ORDERS. SHIPMENTS. Feet. Feet. Domestic cargo Coastwise and 17,216,000 delivery 04,083,000 intercoastal _ 16638000 14,323,000 Foreign 89,324,000 Export 15,228,000 11.477,000 Rail 42,805,000 Rail 14 1: 13 393 7:0 800 4,137,000 Local 47153000 , , Total 226,213,0001 Total 47,396,000 Production for the week was 34,965,000 feet. Production was 14% and new business 19% of capacity, compared with 19% and 19% for the previous week. Southern Pine. The Southern Pine Association reported from Now Orleans that for 98 mills reporting, shipments were 35% above production, and orders 25% above production and 8% below shipments. New business taken during the week amounted to 13.611,000 feet (previous week 10,031,000 at 103 mills); shipments. 14,759,000 (previous week, 15,154,000); and production. 10.908.000 feet (previous week, 14,777.000). Production was 19% and orders 24% of capacity, compared with 24% and 16% for the previous week. Orders on hand at the end of the week at 87 mills were 37,369,000 feet. The 87 identical mills reported a decrease in production of 12%, and in new business a decrease of 16%, as compared with the same week a year ago. Western Pine. The Western Pine Association reported from Portland. Ore., that for 87 mills reporting, shipments were 78% above production, and orders 97% above production and 11% above shipments. New business taken during the week amounted to 12,734,000 feet (previous week, 13.589,000 at 109 mills); shipments, 11,457.000 feet (previous week. 14.378.000); and production 6,448,000 feet (previous week, 9,964,000). Production was 6% and orders 12% of capacity, compared with 8% and 11% for the previous week. Orders on hand at the end of the week at 87 mills were 74,545,000 feet. The 78 identical mills reported a decrease in production of 5% and in new business a decrease of 34%, as compared with the same week a year ago. Northern Pine. The Northern Pine Manufacturers of Minneapolis, Minn., reported no production from seven mills; shipments 663,000 feet and new business 625,000 feet. The same number of mills reported new business 7% less than for the same week last year. Northern Hemlock. The Northern Hemlock & IIardwood Manufacturers Association of Oshkosh, Wis., reported production from 14 mills as 217.000 feet, ship-. melds 161,000, and orders 229,000 feet, Orders were 3% of capacity, compared with 3% the previous week. The 11 identical mills reported an increase of 7% in production and a decrease of 15% In new business, compared with the same week a year ago. Hardwood Reports. The Hardwood Manufacturers Institute of Memphis, Tenn., reported production from 360 mills as 6,353,000 feet, shipments 10,439,000 and new business 10,278,000. Production was 10% and orders 16% of capacity, compared with 13% and 19% the previous week. The 183 identical mills reported production 25% less and now business 17% less than for the same week last year. The Northern Hemlock & Hardwood Manufacturers Association of Oshkosh, VLs., reported no production from 14 mills, shipments 455,000 feet and orders 520,000 feet. Orders were 11% of capacity, compared with 13% the previous week. The 11 identical mills reported a decrease of 38% in orders, compared with the same week last year. Council of Winnipeg Grain Exchange Declares National Marketing Agency Would Involve Country in Financial Difficulties. A statement issued by the Council of the Winnipeg Grain Exchange says: It is the conviction of the Council and members of the Winnipeg Drain Exchange that the National marketing agency demanded by the Saskatchewan Wheat Pool would hinder the marketing of Canadian grain; that it would ultimately involve the country in financial difficulties which the taxpayers ought not to be called upon to suffer; and that it would be injurious both to the producers and to the country. The Council's statement, given in the Dec. 31 issue of the "Financial Post" of Canada also says: In a statement issued on December 20th the Saskatchewan Wheat Pool, referring to the previous week's fall in wheat prices, proposes "a national Volume 136 Financial Chronicle marketing agency to control the disposal of the entire Canadian wheat crop." It goes on to say that the Wheat Pool members "are convinced that the established trading machinery has broken down and they, the producers of an important foodstuff, are the direct sufferers as a result of that collapse." The causes of the low prices which prevail for wheat are perfectly wellknown to the directors of the Saskatchewan Wheat Pool. These causes are complicated by a depression world-wide in extent, more acute than any previously experienced and affecting every industry and activity. The existence of the world surplus of wheat, most of which is held in North America, is the chief reason for the low price of wheat. In the accumulation of that surplus the policies pursued by the Wheat Pools here and by the Federal Farm Board in the United States were the prime agencies. The pursuit of these policies by the Pools in place of utilizing the established trading machinery has involved the Provincial Governments in very heavy losses; has compelled the intervention of the Dominion Government in an effort to prevent even worse consequences; and has overloaded the markets of the world with the large unsold surplus of wheat so that it has been impossible for prices to be sustained at a satisfactory level. Could Not Raise Prices. A national marketing agency would be powerless to raise the present world wheat price level in face of the surplus now existing and of the efforts of the consuming countries, influenced in no small measure by fear of a combination of producers in exporting countries to hold up prices, to produce their own foodstuffs. The reluctance of the Saskatchewan Wheat Pool to admit the failure of its past policies, which are so large a factor in the present disastrous condition of the market, and its anxiety to unload its burdens on the shoulders of a national marketing board backed by such resources as remain to the taxpayers, are evident. The fact remains that the established trading machinery has accurately reflected the condition of the world markets. It has operated continuously and has filled promptly the buying and selling orders received from all parts of the world. Since the beginning of the present crop year the wheat sold and cleared for export by the established trading machinery in Canada has constituted 56% of the total world shipments. In the crop year 1930-1931, during which the Pool ceased its export operations, Canada had a carry-over in all positions of 141 million bushels. The carry-over last crop year amounted to 136 million bushels, and if Broomhall's figures of importing countries' requirements are correct, and Canada is willing to meet competitive world wheat prices, our carry-over at the end of this year should be no larger than in 1931. In other words, the marketing machinery which the Pool claims has fallen down will have marketed every bushel of exportable wheat surplus grown in this country for the past two crop years without increasing the carry-over built up during the few previous years. Adverse World Conditions. World conditions of trade are at present confused and disturbed. Grain markets in important areas in the world are prevented from functioning normally by unsound policies and ill-advised experiments. Tariffs, quotas and milling restrictions have been imposed upon wheat by consuming countries in their own supposed interests. Under the pressure of such influences it is inevitable that the wheat market in Canada, as elsewhere, should be adversely affected. But a national marketing agency could bring no more powerful support to the market than has already been supplied by the Dominion Government through the Central Selling Agency in an effort to bring some relief to the producers. The establishment of a national marketing agency would entail the abandonment of the marketing machinery which has always functioned successfully in the disposal of our crops. It would revive in the consliming countries the prejudice against any endeavor to set an artificial price for wheat. This prejudice arose out of the Pool and United States Farm Board policies and is only now being overcome. A national marketing agency might conceal from the producers the natural course of wheat prices, but it could not, of itself, raise them. Every similar attempt to control prices or to merchandise commodities has resulted in disaster, for which the taxpayers have had to pay the bills and by which the producers have suffered. This has been demonstrated in connection with coffee, silk, rubber, corn and cotton. The record of the Pool itself supplies the best illustration of the consequences which followed their efforts to evade the operation of the forces which determine the price of wheat in the world markets. WovId Hinder Marketing. Prices of primary commodities the world over have fallen as much as wheat and in the case of many of them fell long before the big decline In wheat prices took place. The established machinery of grain trading cannot be held responsible for a condition which prevails in regard to practically all other primary products as well as to wheat. The Winnipeg Grain Exchange does not wish to perpetuate controversy or to recriminate upon those whose mistakes and losses are still fresh in the public mind. But the endeavor to throw upon the Exchange the responsibility for occurrences which are due in large measure to departure from the policies in grain trading which experience has shown to be sound and necessary, cannot be ignored. 7 heat\Barter Urged in Alberta—Would Sell Surpl _ to Soviet Russia. From Calgary, Alberta, Dec. 30 we quote the following Associated Press advices: Bartering or selling on credit of Canada's surplus wheat to Soviet Russia was proposed to-day in a year-end statement issued by the Alberta wheat pool. The suggestion also was offered that all wheat-exporting countries could take similar steps and eliminate the extra supply of grain on world markets. Canada could supply 100,000,000 bushels of the surplus, while the other 200,000,000 could be provided by other exporting countries, it was said. Elimination of the surplus would improve world wheat prices, aid Russia and bring about benefits to all participating countries, the pool contended. Canada's Wheat to Use Her Ports—Halifax and St. John Available for Winter Shipments to United Kingdom—Rates Equal Buffalo's. The recent ruling by the British Treasury that Canadian wheat shipped to England by way of Buffalo and New York or some other port in the United States is not entitled to the preferential treatment of 6 cents a bushel is not now con- 35 sidered a serious handicap to Canadian wheat growers, according to the New York "Times" of January 1, from which we also take the following: When it was made on Dec. 21, the general opinion was that it would work to the disadvantage of wheat grown in the Prairie provinces of the Dominion because in Winter the ports of Montreal and Quebec are closed, and it was thought there would be no other economical way of moving the grain to Great Britain except by way of Vancouver, B. 0., and the Panama Canal. It has been stated since that time, however, that the wheat can be moved through the ports of Halifax, N. S., and St. John, N. B., almost as advantageously as through New York or other Atlantic ports in the United States, and that those Canadian outlets to the Atlantic are equipped to handle grain as efficiently and economically as is this port. The allrail rate from Georgian Bay to either St. John or Halifax is the same as the rail rate from Buffalo to New York, being 15.17 cents a hundred pounds. Winter Wheat Movement. The method of moving Canadian wheat in the Winter has consisted of carrying the grain to Buffalo in vessels that lay up there for the Winter. The grain remained in storage in the boats until a buyer was found, when it was transferred to railroad cars and transported to the seaboard, usually at this city. To obviate the use of Buffalo as the discharging point for vessels in the Winter, it is reported that a Canadian port on Georgian Bay, might be made the transfer point. A shipment from Fort William, Out., by water would remain aboard the boat there until it could be trans-shipped by rail to a Canadian Atlantic port. The rate by water from Fort William to Georgian Bay is 3.60 cents a hundred pounds for grain, the same as to Buffalo. Carriage to ports in the United Kingdom is said to be cheaper by way of Churchill, the new port on Hudson Bay, but that port is open only until the early Fall. At Canadian Ports. It is understood that St. John alone has handled as much as 30,000,000 bushels of grain during a Winter season and expects to take care of exports of upward of 35,000,000 bushels this Winter. One elevator there has handled 1,635,000 bushels of grain for export this season, and on one day last week there were reported on track and in elevator 1,319,000 bushels, with orders on hand for delivery of another 123,000 bushels to ships in the harbor. Vancouver's wheat exports from Aug. 1 to the end of December are reported to have been about 47,000,000 bushels, the largest volume for that period in the port's record. A shipment of three carloads of wheat from Canada through Buffalo, by rail to New York and then on the Franconia to Liverpool, was the basis for the ruling of the British Treasury. The British Treasury held that there was no evidence that the whole shipment, which began the journey from Canada, was identical, kernel for kernel, with the cargo landed from the Laconia. It was pointed out, however, that this ruling would not apply in the matter of boxed or crated goods routed the same way, because in such a case there would be no doubt as to the identity of the shipment. Wheat Medium of Exchange in North Dakota—Barter Returns to Many Communities. On Dec. 30 Associated Press advices from Bismarck, N. D., stated: Wheat is rapidly climbing up on the dollar as a medium of exchange on the prairies of North Dakota. Barter has returned in a big way to many communities as the farmer hitches up his horses and brings in a load of wheat to do some purchasing. Subscriptions for the weekly newspaper, club dues, school tuition, even second-hand automobiles, have been bought with wheat. Many millers accept grain as payment for grinding wheat into flour. At Fessenden, Mott and Temvik the millers accept wheat, grind it and In return give the farmer a percentage in flour, with no money involved. The miller profits by taking his fee in part of the grain and markets the flour for his eventual monetary gain. Frank 3ieGray, a retail dealer and garage owner at Garrison, is retiring past accounts with wheat for which he allows credit of $1 a bushel. World Wheat Stocks Heavy Because of Restricted Demand. The world wheat market is burdened by heavy stocks which are largely the result of restricted demand in importing countries, it is stated by the Bureau of Agricultural Economics, U. S. Department of Agriculture, in its report on world wheat prospects issued Dec. 29. Shipments of wheat and flour from July through mid-December, from the principal exporting countries, have totaled 261,000.000 bushels as compared with 355,000,000 bushels in the corresponding period last season. This low level of shipments, the Bureau continues, has left the principal exporting countries with somewhat larger stocks of wheat as of December 1 this year than on December 1, 1931. Total stocks available for export and carry-over from the old crop in the United States, Canada, Australia and Argentina are estimated to have been about 745,000,000 bushels on December 1 compared with 708,000,000 bushels on December 1 last year. Also, the new crop of both Argentina and Australia is estimated to be somewhat larger than last year. The Bureau likewise says: World shipments, it is expected, will be larger during the second half of the drop year because supplies of wheat from the large European crops in 1932 are being reduced, and although some countries have such large crops as to make it unlikely that they will import significant quantities, other countries, will have to depend more largely upon supplies of foreign wheat. 36 Financial Chronicle Commercial Treaty Between Austria and Hungary Establishes Trade Ratio and Proposes Preferential Duty on Wheat. A new commercial treaty between Austria and Hungary has been ratified, effective January 1 1933, for the duration of one year, it was made known in a cablegram received in the Department of Commerce from Commercial Attache Gardner Richardson, Vienna. The Department in indicating this on Dec. 28 said: The treaty takes the place of the former treaty of June 30 1931, which had been denounced by Austria to terminate on June 30 1932, and which was superseded by a modus vivendi, effective since August 5 1932. The new treaty establishes a compulsory ratio between the trade of the two countries of three to two, in favor of Hungary, i.e., it limits Hungarian imports from Austria to two-thirds of the value of Austrian finports from Hungary. Among other provisions the new treaty contains a preferential rate of Import duty of 7.80 gold crowns per 100 kilos on 50,000 tons of Hungarian wheat, to become effective July 1 1933, provided that all other countries having a most-favored-nation treaty with Austria agree to that arrangement. It is reported that the new treaty does not contain any other important duty changes, and that the system of freight and credit privileges to facilitate purchases from the other country, which was an important part of the previous treaty, has been maintained in the new treaty. "Denounce" in international law means the giving of a notice of termination. World's Production of Grain a Puzzle—Continued Increase in Harvests, Notwithstanding Unremunerative Prices. Under the above head the New York "Times" reported the following from Rome (Italy), Dec. 27: Year-end statistics of the world's grain production, although reaching large figures, do not substantially modify recent forecasts of large requirements on the part of importing countries. This may prevent further Increases next year in grain stocks of the principal exporting countries. It is noteworthy, on the other hand, that certain exporting countries, which naturally apply no effective customs protection to the grain trade, have increased the area sown with grain. To Italy this seems incomprehensible when the unremunerative price of the product is considered. On the whole, there seems to be no sign of international discipline toward reducing existing stocks or proportioning production to consumption. Atlanta Chamber of Commerce Aids Back-to-Farm Movement. Under date of Dec. 29 from Atlanta, the New York "Times" published the following in its Jan. 1 issue: Taking official cognizance of the fact that farmers in all parts of the State are seeking farm hands for positions, paying wages or offering shares of crops and homes, the Atlanta Chamber of Commerce has volunteered Its services as a clearing house for such requests. The Chamber at present has a list of about 1,000 families living in Atlanta who are desirous of returning to the farm. Its policy In keeping stranded families and rejuvenating abandoned farms, revealed in the recently inaugurated "back-to-the-farm" movement, precludes families not completely dependent upon charity. Responsibility for only those families with actual farming experience is being accepted. Texas Farmers Given $981,756 By Agricultural Credit Corporation at Fort Worth and Texas Branches. The Agricultural Credit Corporation at Fort Worth and the branches at San Angelo and Houston have paid out $981,756 to 110 applicants since organization, it was announced Dec. 19 at the office at Fort Worth, according to Associated Press advices published in the Houston "Post." The dispatch also said: That is at an average of $8,916 per loan. In addition 588 applications amounting to $3,006,619 have been approved, but the money has not been disbursed. There are 723 applications amounting to $4,247,634 pending. There have been 2,496 applications to date. There have been 43 loans amounting to $350,755 disbursed through headquarters here, A. E. Thomas, manager, reported. There have been 799 applications received by the Fort Worth office to date. Ben S. Smith, manager of the Houston branch, reports that nine loans amounting to $63,445 have been disbursed and that 230 requests totaling $399,219 have been approved, but not disbursed. There are 317 applications totaling $876,905 pending. This branch has received 742 applications totaling $1,556,117 to date. Many of these loans are for agricultural purposes. The San Angelo office, according to G. C. Magruder, manager, has disbursed 68 loans totaling $567,556, and has approved 165 requests amounting to $1,793,933, but has not disbursed the money. There are 343 applications, totaling $3,075,115 pending, with 995 applications totaling $9,918,835 received so far. Farmers Holding Argentine Crops—Refusal to Harvest Them is Result of Continued Low Prices for Grains —Year's Exports Decline. In a cablegram Jan. 1 from Buenos Aires, to the New York "Times" it was stated that Argentina closed the year with grain prices so low that farmers In several regions are refusing to harvest their crops because prices will not cover the cost of harvesting. The cablegram continued: Wheat closed in the futures market here at 5.10 pesos a quintal, equiva/ 2 cents a bushel, compared to 35% cents last week. Corn lent to 351 was unchanged at 3.95 pesos a quintal, equivalent to 26 cents a bushel, Jan. 7 1933 and flaxseed at 9.05 pesos a quintal, equivalent to 59 cents a bushel. New wheat recently was quoted as low as 4.90 pesos a quintal, equivalent to 34 cents a bushel. These quotations are for grain delivered at Buenos Aires, the farmers receiving only slightly more than half the amounts. Bank balances on Nov. 30, published last week by the Minister of Finance, show for the first time in recent history no apparent preparation for an increased monetary movement for the handling of crops, three headings, deposits, loans and discounts and cash reserves, showing virtually no change, whereas in normal times there is a sharp upward movement of loans and pronounced withdrawal of deposits in October and November. The year's exports of all grains amounted to 13,560,139 metric tons, compared with 16,148,709 in 1931. The United States took 175,283 bushels of wheat, 373,543 of corn and 7,870,653 of flaxseed. Wool exports to date from Oct. 1 are 72,186 bales, compared with 69,927 at the end of 1931 and 62,486 at the end of 1930. The United States has taken only 3,329 bales, compared with 5,544 on the same date in 1931. Stock on hand in the central market here at the year-end was 8,890,200 pounds, against 19,555,800 at the end of 1931. Eight British-owned railroads operating 16,416 miles of Argentina's total of 24,500 mileage show a decline of £2,603,700 in receipts since July 1 from the total for the last half of 1931. . . . The Bureau of Rural Statistics estimated the exportable surpluses on Saturday as follows: Wheat, 148,252,520; corn, 8,007,817; flaxseed, 46,871,560. Mexico to Turn Federal Army Camp Into Farms to be Parceled Out to Agrarians. Associated Press accounts Jan. 2from Mexico City stated: The extensive Federal Army concentration camp at Sarabia, Guanajuato, established several years ago and recently ordered abandoned, will be turned into farms, the Government announced to-day. Several thousand acres comprise the camp, which will be parcelled out to agrarians. The land is regarded as valuable because of the irrigation system and buildings erected by the army. Soviet Russia Bars Food for Housewives Under 56— All Must Work in Industry to Get Bread. Under date of Dec. 29 Associated Press advices from Moscow were published as follows in the New York "Times": Russian housewives who now may purchase for themselves small rations of bread and sugar from the Government stores will lose that privilege after Jan. 1, and thereafter they will have to earn those commodities by working in factories or offices. The Government decreed to-day that after the first of the year all housewives under the age of 56 will be deprived of the cards which entitle them to purchase sugar and bread. In the category of housewives are included all healthy women not engaged in "socially useful" work. The wives of a number of high Government officials are in this class. The new order reflects the continuing food shortage and is an extension of the Government's "nowork, no food" policy. Its object, apparently, is to bring more women into industrial occupations with a view to ultimate abolition of the home as the unit of family life. At the end of 1931 a census of Moscow showed there were about 100,000 housewives in the city. Eighteen per cent of them were over 60, but it was estimated that by the end of 1932 the number would have been reduced by half. Under the present arrangement the housewife is entitled to 400 grams of bread and 800 grams of sugar a month from the regular Government supply stores. After Jan. 1 she will have to leave her home for an industrial job or give up sugar and bread. The only choice will be to pay the exorbitant prices in the private market, where 400 grams of bread (less than one loaf in New York) costa about $3.50, as compared with 10 cent or less at the Government bakery. Refined Sugar Price Cut to Four Cents. Sugar refiners cut the price of their product sharply Jan. 4, while the price of raw sugar and quotations for futures moved higher. In reporting this the New York "Times" of Jan. 5 also said: All leading Eastern refiners announced a reduction of 15 points to four cents a pound for refined sugar, effective at once, restoring the low rate of July 15. On the New York Coffee and Sugar Exchange, the price of sugar in the January position rose three points to 0.71 cent a pound. Cream Price Reduced by Borden's and Sheffield's— Retail Price in New York City at Lowest Point in Recent Years. A reduction in the retail price of heavy cream of three cents a half pint and of two cents a half pint for light cream, which went into effect Jan. 2, was announced Jan. 4 by the Borden's Farm Products Co., Inc., and the Sheffield Farms Co., Inc., according to the New York "Herald Tribune" of Jan. 5, which also said: The Borden company also announced a reduction of five cents a quart In the retail price of Walker Gordon milk. The price of heavy cream was reduced from 18 to 15 cents the half pint and of light cream from 12 to 10 cents. The reduction brings the retail price of cream to the lowest point it has reached in the city in recent years and, according to officials of the two companies, is due to large oversupply of milk and cream and the prevailing low prices for butter and other by-products. January Release of Brazilian Coffee—Bids Ranging from 9.48 Cents to 9.59 Cents a Pound Accepted by Grain Stabilization Corporation. According to the New York "Times" prices considered surprisingly high in the trade were received by the Grain Stabilization Corporation at the auction on Jan. 4 of 62,000 bags of its January instalment of Santos coffee, part of the Volume 136 Financial Chronicle 1,050,000 bags received in 1931 from Brazil in exchange for • wheat. The "Times" added: Bids ranging from 9.48 to 9.59 cents a pound, or 25 to 50 points higher than the trade generally had expected, were accepted, according to an announcement made soon after the close of trading in futures on the New York Coffee & Sugar Exchange. Prices on the Exchange had declined three to 10 points in the day, carrying the March Santos position, the nearest position traded, to 8.22 cents a pound. The Stabilization Corporation still has 500 bags of its January allotment and will add them to the quantity to be oilered on Feb. 1. National Coffee Council Not to Change Brazilian Export Coffee Tax. Associated Press advices from Rio de Janeiro, Jan. 5, stated: The National Coffee Council denied to-day that it planned to lift the Federal export tax of 15 shillings a sack on coffee, which is necessary to pay Government obligations. From the New York "Journal of Commerce" of Jan. 6 we take the following: No further reductions will be made in the Brazilian export taxes on coffee, Sebastiao Sampalo. Consul General of Brazil. announced last night following receipt of a cablegram from Dr. Mauro Roquette Pinto. President of the National Coffee Council of Brazil. "All necessary alterations, both in the 15s and in the State taxes, have now been definitely established," Mr. Sampaio said. "The National Coffee Council of Brazil will continue to follow its known policies, maintaining its harmonious work with the Government and the Banco de Brazil, with the necessary resources at its disposal and without changes of any kind which could affect the interests of the trade." Oklahoma Cotton Growers' Association Co-operatives May Wind Up Season's Business by Feb. 1. The following Oklahoma City advices Jan. 2 are from the New York "Journal of Commerce": Manager A. E. Kobe of the Oklahoma Cotton Growers' Association announced estimated seasonal total receipts of the organization to date at 75,000 bales before the mid-December meeting of the directing board December 20. Plans were laid for winding up the 1932-33 business in the quickest and most economical way. Although it was pointed out that there were many thousands of bales of cotton yet to be delivered to the Association, the Board decided that with sufficient activity from now until Feb. 1 most of the season's deliveries could be made. As an economic move the Association's operating force will he reduced from 100 to 10 employees during the period from March 1 until Aug. 1. The Board thought it advisable to await Congressional action with reference to farm relief measures before making definite plans for next season's operations. They feel confident that if any farm relief measures should be passed they would constitute an effort to strengthen rather than weaken co-operative marketing. Georgia Grower Proposes Farmers Buy Surplus Cotton —Would Exact Pledge to Plant No Crop During 1933. In its Jan. 1 issue the New York "Times" reported the following special correspondence from Atlanta, Ga.: Whether the cotton buying scheme adopted by a mass meeting of farmers Jackson, Ga., was inspired by technocracy is a question for experts. J. M. Gaston proposed that Southern farmers buy the surplus cotton. His resolution was in part as follows: "Let the Government, instead of lending farmers money to produce more cotton, lend those who need to borrow from the Government money to buy some of the surplus cotton already produced, proportional to their average production, plus a small additional loan for the production of food and feed, on condition that they will not grow any cotton or allow any to be grown in 1933 on any land they own or control." The borrowers would sign contracts to these terms and the Government would hold the cotton receipts as collateral. The plan presupposes that prosperous growers would decrease their acreage. in World Consumption of Cotton in November 2,027,000 Bales, Compared with 2,065,000 Bales in October— Total November 1931, 1,981,000 Bales—Increase in Consumption of American Cotton. World consumption of all kinds of cotton during November was approximately 2,027,000 bales as against 2,065,000, revised, in October; 1,981,000 in November last year, and 1,910,000 in November two years ago, according to the New York Cotton Exchange Service. During the first four months of this season, from Aug. 1 to Nov. 30, world consumption of all cottons approximated 7,836,000 bales as against 7,755,000 in the corresponding portion of last season and 7,173,000 two seasons ago. The Cotton Exchange Service, on Jan. 3, also said: The increase of 81,000 bales over last season and of 663,000 bales over two seasons ago is entirely due to an increase in consumption of American cotton. Consumption of American cotton during the first four months of this season and 455,000 bales larger than in the corresponding months last season, and 918,000 bales larger than two seasons ago. Meanwhile, consumption of foreign cotton was 874,000 bales less than in the corresponding four months last season, and 255,000 bales less than two seasons ago. Switzerland Imposes Export Duties on Cotton Looms, Used Watchmaking Machinery and Parts of These. Effective Jan. 1 1933, the Swiss Government has fixed an export duty of 800 francs per 100 kilos on the exportation 37 of cotton looms and parts, it is stated in a cablegram to the Department of Commerce from Commercial Attache Charles E. Lyon, Berne. The Department, on Dec. 29, added: By a similar decree the Swiss Government had previously imposed an export duty of 2,000 francs per 100 kilos on used watch-making machinery and parts, according to a report from B. Reath Riggs, First Secretary of the Legation at Berne. It is understood that these export duties have been applied in order to prevent the migration of plants from Switzerland by the exportation of their machinery abroad. Raw Silk Imports Fell Off During 1932—Apprioxmate Deliveries to American Mills Also Lower—Inventories Higher. According to the Silk Association of America, Inc., imports of raw silk during the month of December 1932 amounted to 45,453 bales, as compared with 47,422 bales in the preceding month and 50,617 bales in the same month in 1931. Approximate deliveries to American mills totaled 40,548 bales as against 48,432 bales in December 1931 and 43,955 bales in November 1932. During the 12 months ended Dec. 31 1932 imports were 547,195 bales (or a monthly average of 45,600 bales), compared with 605,919 bales (or a monthly average of 50,493 bales) in the calendar year 1931 and 549,884 bales (or a monthly average of 45,824 bales) during the year 1930. Approximate deliveries to American mills were 553,818 bales (a monthly average of 46,151 bales) in 1932 and 594,889 bales (a monthly average of 49,574 bales) in 1931. Stocks at warehouses as of Dec. 31 1932 totaled 62,837 bales, as against 57,932 bales a month previous and 69,460 bales a year ago. The Association's statement follows: RAW SILK IN STORAGE. (As reported by the principal public warehouses in New York City and Hoboken.) Figures in Bales— European. Japan. All Other. Total. In storage. Dec. 1 1932 3,856 49.429 5,647 57.932 Imports, month of December 1932_x 609 41,579 3.265 45,463 Total available during December 1932..... In storage Jan. 1 1933_z 3,465 2,845 91,008 54,012 8,912 103,385 5,980 62,837 620 36,996 2.932 Approximate deliveries to American mills during December 19324, 40.548 SUMMARY. 11111)0Till Duress the AforithAs) January February March April May June July August September October November December Total Average monthly 1931. 1930. 1932. 1931. 1930. 52.238 53,574 88.866 30,953 84.233 31.355 86,058 61.412 66,589 88,775 47,422 45,453 49,294 47.827 57,391 29.440 42.284 46,825 37.315 58.411 48.040 70.490 67.999 50.617 43,175 42,234 39,990 37.518 22.590 22.369 47.063 81.147 58.292 68,594 55.293 64.616 62.905 70.570 62,675 87,849 89,159 53,048 50,721 52,228 49,303 84,465 57,932 62,837 51.814 45.390 47,407 35.497 82,688 37,352 29.921 41.878 36.099 49.921 67.275 69,480 76,266 68,646 57.772 53.704 85,477 28.450 35,568 44.978 47,621 51,278 49,288 88,430 547.195 45S00 805.919 50.493 549.884 48.824 57:910 45:090 80:019 Approrintate Detiveries to A1710*(117 January February March April May Juno July August September October November December Storage al End of Mon10.(n) 1932. Approximate Amous of Japaa Bilk in Transit Between Japan and New York End of Month. 1932. 1931. 1930. 1932. 1931. 1930. 58,793 45,909 46.761 35.779 32,923 37.466 38,882 59,905 59.094 53.703 43.055 40,548 55.910 54,242 55.383 41,356 45.073 42.161 44.746 46,484 53,819 56.668 50.048 48.432 57.883 49.852 50.863 41.8/44 40,823 29.396 89.948 41.734 85.649 61.937 57.333 55.424 48.800 31,000 28,800 34.800 30.800 81.100 43,156 43,400 42.00 44,700 80.200 51,400 37,700 37.700 21,300 24.800 36.900 33,400 41,800 40,500 53.200 69.700 80,800 53.900 37.000 24,000 17.800 8,000 7.700 16.300 31.200 41,700 51.600 46.400 45.500 35.600 Total 653.818 594.889 582.226 Average montbir 46,151 49.574 48.519 40,958 80.213 40 058 x Covered by European Manifests Nos. 53 to 56, inclusive, Asiatic Manifold! Nos. 247 to 269, Inclusive. y Includes re-exports. z Includes 2,502. bales held at terminals at end of month. Stocks at warehouses include National Raw Silk Exchange certified stocks 2,430 bales. Review of Tobacco Industry by R. M. Ellis—Industry in Position to Do Much to Stabilize Other Business if Legislators Refrain from Enacting Unreasonable Taxes. In reviewing the tobacco industry at the outset of the new year, R. M. Ellis, President of the Philip Morris Ltd., Inc., states that "if all industries were in as good shape as is the tobacco industry to-day, the United States could look forward to a prosperous, and even profitable year in 1933." In summing up his views Mr. Ellis says "if we can count on the retailers to ask for reasonable profits and can prevent the legislators from demanding unreasonable taxes, the tobacco industry is in a splendid position again to do much to stabilize and stimulate other businesses in the coming year." In pointing out that "few people realize how much the stability of the tobacco industry contributed during 1932,and how firm a foundation it may prove next year—if it is only 38 Financial Chronicle Jan. 7 1933 left to work out its own problems without others being added." Mr. Ellis went on to say: Petroleum and Its Products-Oil Allowable in Texas Again Cut in New Proration Orders-Further Everybody sees the big Sc. tax stamp on each package of cigarettes. Some Price Adjustments Made in Oklahoma and Texas. people may even realize that the 6c. tax on 20 cigarettes means that the Further reduction in the crude oil output of the State of Unuted States makes more money out of every package than the manufacturer, wholesaler or retailer-often making more on each package than Texas is called for in the State Railroad Commission's new does the whole cigarette industry put together. In spite of this, different proration orders issued Jan. 2 and effective until April 1. States are constantly toying with the temptation to kill the goose that lays the golden egg, and add their State stamp tax as well. In more than 10 The State's total production is restricted to 757,150 barrels States, this has been done. Our hope is that wiser counsel will show that daily, as compared with the previous allowable of 789,757 any industry that pays a regular income of $400.000,000 to the Federal barrels. However, the State's actual output in the week Government.should not be endangered by petty taxes for local purposes. So far as the United States Government itself is concerned, the lamentable prior to the East Texas shut-down on Dec. 17 was 853,200 failure of the nuisance taxes-particularly in the case of the extra lc. postage barrels daily. East Texas under the new order is held to -win, we hope, be sufficient warning that where a fair tax is a profitable 290,000 barrels, as against previous order of 310,000 barrels. business for everybody concerned, a very slight addition will hamstring the whole industry in a most amazing way. The East Texas allowable was arrived at through deThe year 1932 did not, of course, see the tobacco industry unscathed, but termination of well and bottom-hole pressure. This means the ingenuity of the various manufacturers and retailers enabled them, for the most part, to turn weak elements to their own advantage. that figured on a per well basis, production will range from The 10c. cigarette, for example, made possible by depression levels for 28 to 35 barrels daily. Dividing the field into 10 units, tobacco, labor and other costs, reached a peak some place as high as 30% the Commission bases its per well allowable for each unit of the entire cigarette sale. More conservative estimates would place this peak at 25%. and its present proportion around 20%. While this enables on pressure of 1,000 to 1,500 pounds. the manufacturers to do a shrewd bit of specialty manufacturing and The Commission took advantage of its authority to conemergency merchandising, the profits left to the whole industry out of a sider market demand in establishing the new ruling, and also 10c. price, after deducting the 6c. United States tax, are too thin to be reassuring to the conservative financing and producing interests that promade as a requirement the condition that all of the 350 unperly belong in so great an industry. . . . connected wells in East Texas be connected with pipe lines. The extreme price slash among the various retailers has, as a general rule, Until the new formula could be put into actual effect all been founded more in reckless competition among themselves, than in any real reluctance on the part of smokers to pay a decent price for so intimate a wells were permitted to produce on a flat 28-barrel per luxury and so personal a pleasure as their favorite tobacco. Now that rewell basis. tellers the country over have seen the chain stores and their landlords learn The Oklahoma Corporation Commission at the same time so well the necessity for doing business at a reasonable profit, we may perhaps hope that they will think twice before again doing damage to the established a daily limit of 386,003 barrels daily for the Whole tobacco industry, merely in order to hurt each other-and themselves. month of January, this being an increase of 823 barrels over allowable. The Oklahoma City field under this Both Wholesale and Retail Prices of Cigareites Reduced December permitted daily output of 74,333 barrels, this ruling is -Chain Stores Fix Price at 2 Packages for 25 reached, figure being in accordance with an opinion of the Cents. Supreme Court, by sands, the Commission apportioning The American Tobacco Co., one of the four leading 48,171 barrels daily to the Wilcox sand; 25,161 to the Simpcigarette manufacturers in this country, took the initiative son below the Wilcox, and 875 to the siliceous area. Thereon Jan. 2 in announcing a reduction in the wholesale price fore, each well, with the exception of those in the lime area, of cigarettes. The company, manufacturers of Lucky will have a minimum daily allowable of 30 barrels, while Strikes, reduced the price for 1,000 cigarettes from $6.85 wells making 10% or more water will be permitted to to $6, effective Jan. 3. This change was met later in the produce 100 barrels daily in addition to the allowables day by the R. J. Reynolds Tobacco Co. Officials of that based on potentials. The next Oklahoma proration hearing company announced a reduction in the price of Camel will take place Jan. 27. cigarettes in line with the American Tobacco Co.'s cut, to Further adjustments of crude prices have been made meet competition. The two other tobacco concerns in during the week. Effective on Jan. 1 the Magnolia Petroleum the group known as the "Big Four," namely, the Liggett & Co. posted reduction of 13 to 200. a barrel in north central a Myers Tobacco Co. and the P. Lorillard Co., met the Texas, central Texas, and Oklahoma. The Pure Oil Co. reduction in the wholesale price of cigarettes on Jan. 3. announced an increase of 10c. a barrel in Michigan crude, The Liggett & Myers Co., manufacturers of Chesterfields and the Bell Oil & Gas Co. posted lower crude prices in and the P. Lorillard Co. are the makers of Old Golds. southern Oklahoma and north Texas. These reductions resulted in cuts in retail quotations on These price changes follow: Jan. 3 by most of the chain-store systems to 13 cents a Dec.31.-Pure 011 Co. posts increase of 10c. a barrel in price of Michigan package and 2 packages for 25 cents. Regarding the crude oil, new price being 95c. a barrel. Jan. 1.-Magnolla Petroleum Co. posts reduction of 13c. to 20c.in retail price change, the New York "Times" of Jan. 4 said: crude prices in north Central Texas, The prices of these chains was formerly 14 cents and 2 for 27 cents. Lucky Strike. Camel, Chesterfield and Old Gold are the brands affected by this slash. Among the chains which have made the cut are United Cigar Stores, Schulte retail stores and Liggett's drug stores The cause of the slash in wholesale prices is generally ascribed by cigarette authorities to the competition which the four leading brands have been receiving from manufacturers of 10-cent cigarettes. The "Times" of Jan. 3 contained the following regarding the wholesale price change: The revision in the wholesale price of cigarettes comes two years after an increase was made by the "Big Four." For some time prior to that there had been in effect a lower price that permitted retailers to offer the 15-cent brand of cigarettes at 2 packages for 25 cents. This price was removed when the wholesale price was increased. The reduction in price brings the wholesale price of cigarettes to less than 12 cents a package when the Jobber and retailer take advantage of the discounts allowed by the manufacturer. We learn from the New York "Times" of Jan. 5 that announcement was made on Jan. 4 by the Great Atlantic & Pacific Tea Co., that its Eastern Division had reduced the price of the four leading brands of cigarettes from $1.25 a carton to $1.19 a carton. This places the company's price in line with quotations of other large chain-store systems. The company is continuing to sell the leading cigarette brands at 2 packages for 25 cents, the price which it has quoted for several months. Price of Cigarettes Cut by Kroger Grocery & Baking Co.-Effects Ohio, Indiana and Kentucky. Advices from Cincinnati, Ohio, to the "Wall Street Journal" of Jan. 5 said the Kroger Grocery & Baking Co.'s Cincinnati Branch, which has stores in southeastern Ohio, southwestern Indiana and northern Kentucky, has reduced prices of cigarettes in the last two States to 2 packages for 25 cents. The advices said that in Ohio, where there is a State tax of 2 cents a package, the price has been cut to 2 for 29 cents from 2 for 31 cents. central Texas. and Oklahoma. New price schedule begins at 45c. for oil under 25 gravity with 2c. differential added for each degree of gravity ending at 77c. for 40 gravity and above. This schedule applies to Burkburnett, Archer, Stephens, Henrietta, Electra, Comanche and Olden fields in north central Texas: Mexia, Worthara, Corsicana, Light and Panola counties in central Texas, and to all of Oklahoma. Jan. 4.-Bell Oil & Gas Co., Tulsa, posts reductions in crude prices In southern Oklahoma and north Texas with new schedule starting at 464 for 33 gravity with a 2c.advance for each degree up to 60c.for 40 and above] Prices of Typical Crudes per Barrel at Wells. (All gravities where A. P. I. degrees are not shown.) Bradford, Pa $1.72 Eldorado, Ark.. 40 $0.75 Corning. Pa .85 Husk, Tex., 40 and over .77 Illinois .87 Salt Creek. Wyo ,40 and over--- - .77 Western Kentucky 1.05 Darst Creek .60 Mid-Continent, Okla., 40 and Midland Dist., Mich .95 above .77 Sunburst, Mont 1.05 Hutchinson, Tex., 40 and over_ _ -- .63 Sante Fe Springs, Calif.,40 and Over 1.00 Spindletop, Tex., 40 and over .65 Huntington, Calif., 20 1.00 Winkler, Tex .50 Petrolia, Canada 1.90 Smackover, Ark.. 24 and over .75 REFINED PRODUCTS-GASOLINE PRICE-CUTTING WIDESPREAD-SINCLAIR WARNS OF NEED FOR IMPROVED CRUDE SITUATION-BULK MARKETS WEAKENING. As gasoline price-cutting became widespread this week, the following statement was issued by the Sinclair Refining Co., presenting an accurate resume of the present situation:"The reduction in gasoline prices effective this week was an inevitable consequence of the various cuts in the price of crude oil. We were not in favor of crude oil reductions, but when they ()mired there was no escape from reductions in refined prices. Conditions were made worse by the continued production of large amounts of crude in excess of the allowable in Oklahoma and Texas. This bootleg crude, always sold far below the posted price, comes on the market in the form of cut price gasoline. Until the trend of crude prices is reversed, and proration orders honestly and effectively enforced-if that is possible-demoralized gasoline prices will continue." The gasoline tank-car situation is definitely weaker than at any time in recent months. It is expected momentarily that reductions in bulk prices will be posted by leading marketers, although such action has been firmly opposed , by many factors in the industry. It is felt that a rise in crude prices depends upon stability of refined products prices, and that if gasoline prices sag further it will bring about a resultant further drop in crude prices,thus reversing the procedure of rising gasoline prices causing price advances in the crude market. The gasoline price structure in the mid-west took a downward sweep over the last week-end when the Sinclair Refining Co., subsidiary of Consolidated Oil Corporation, posted a general reduction of lc a gallon in tank wagon and service station prices throughout its territory, making tank wagon price 9343 and service station 123/2c. This was met by Standard of Indiana. Standard of Ohio met the cuts at all places where prices were not already below the state structure. Pure Oil Co. adjusted its prices to the same basis. Subsequently Standard of New York,subsidiary of Socony-Vacuum Corporation, has posted prices on the same basis for standard grade gasoline in New York and New England. Atlantic Refining has cut prices in eastern and western Pennsylvania. Prices in some sections of Standard of New Jersey's territory have been revised downward where stations are in competition with Sinclair distributors. The weakness shown in gasoline is being reflected in other refined products. Fuel oil is showing a faltering tendency, although no price reductions have yet been effected. Spot demand is erratic, and little bulk business is being booked for future delivery. The crude situation is such an unsettling influence that no stable basis can be arrived at in refined markets until there is a definite trend toward firmer prices in the crude fields. Grade C bunker fuel oil is still posted at 75c. a barrel, in bulk at refinery, and Diesel is unchanged at $1.65 a barrel, same basis, Diesel,however,is very quiet and little movement is reported. Kerosene consumption is reported as favorable and above expectations. As a result 41-43 water white is holding firm at 53/2c a gallon, tank cars at refineries. Price changes follow: 1932 and an average daily output for the four weeks ended Dec. 31 1932 of 1,976,950 barrels. Stocks of motor fuel at all points increased from 51,070,000 barrels at Dec. 24 to 52,339,000 barrels at Dec. 31 1932, or an increase of 1,269,000 barrels during the week as against an increase of 1,135,000 barrels for the preceding week. Reports received during the week ended Dec. 31 1932 from refining companies controlling 91.6% of the 3,856,300 barrel estimated daily potential refining capacity of the United States, indicate that 2,011,000 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, 34,985,000 barrels of gasoline and 127,636,000 barrels of gas and fuel oil. Gasoline at bulk terminals amounted to 11,690,000 barrels and 1,164,000 barrels were in water borne transit in or between districts. Cracked gasoline production by companies owning 95.4% of the potential charging capacity of all cracking units, averaged 389,000 barrels daily during the week. The report for the week ended Dec. 31 1932 follows in detail: January 1.-Sinclair Refining Co. posts lc. reduction in gasoline prices throughout territory, tank wagon and service stations. January 1.-Standard of Indiana meets Sinclair price changes throughout territory affected. January 3.-Standard of Ohio posts lc. reduction in gasoline prices throughout state. The new prices, adopted by all major companies, are 12c., 14c., and 17e. a gallon, including taxes. January 3.-Humble Oil & Refining Co.. The Texas Company, and the Gulf Refining Co. meet new Sinclair gasoline prices, making new retail price at Houston 15e. a gallon for regular grade. January 3.-Standard of New York, subsidiary of Socony-Yacuum, reduced tank wagon and service station prices le. a gallon, making new Prices 9%c. and 123ic., respectively, for standard grade in New York and New England. January 3.-Atlantic Refining Co. posts lc. reduction in gasoline prices in eastern and western Pennsylvania. New York Atlanta Baltimore Boston Buffalo Chicago Cincinnati 39 Financial Chronicle Volume 136 Gasoline, Service Station, Tax Included. $.128 5.185 New Orleans $ 135 Cleveland 13 .18 Philadelphia 19 Denver 135 San Francisco: .187 Detroit Third grade .139 17 .145 Houston Above 65 octane... .180 195 155 Jacksonville Premium .214 55 14 Kansas City .14 147 St. Louis 165 Minneapolis Kerosene,4143 Water White, Tank Car Lots, F.O.B. Refinery. $.02)(-.O3% I New Orleans, ex -.80.0354 N.Y.(Bayonne) ---$.05l§'Chicago 0434-.0354 03 (Los Ace., ex _ .0454-.Os [Tulsa North Texas Fuel 011, F.O.B. Refinery or Terminal. Gulf Coast C California 27 plus D $.60 N. Y.(Bayonne)$.75-1.001Chicago 18-22 D-42%-.50 5.75 Bunker C 1.65 i New Orleans C ___. .60 Philadelphia C .70 Diesel 28-30 D Gas Oil, F.O.B. Refinery or Terminal. !Tulsa j Chicago5.0134 N.Y.(Bayonne)5.01341 28 plus 0 0.-$.033i-.04 i 3246 G 0 U. S. Gasoline, Motor (Above 65 Octane), Tank Car Lots, F.O.B. Refinery Chicago N. Y.(Bayonne)5.04-.0454 N. Y.(Bayonne)New Orleans, ex. .05-.0554 Pan-Am.Pet. Co.S.08 Standard 011, N.J.Eastern Arkansas Pet_ Shell .0654 04-.045( Motor, 60 ooCalifornia...... 05-.07 New York$ 06 tane Colonial-Beacon _ .0854 Los Angeles. ex- 04%-.07 Motor. 65 0007 Gulf ports Crew Levick .05-.05K 0654 taste .06 Tulsa z Texas Motor,standard .0654 08 ' Gala Pennsylvania_ Gulf .06X __ Y._ Stand.011, N. 07 Continental Tide Wat. Oil Co._ .0854 ea . Republic Oil Richfield 011 (Cal.). .0 0.4 Warner-Quin. Co_ .07 •Below 65 octane. z "Fire Chief".0654 a ..-.--.4.--. Daily Crude Oil Production Again Falls Off, Due in Part to Observance of Christmas Holiday-Further Increase Noted in Gasoline Inventories. The American Petroleum Institute estimates that the daily average gross crude oil production for the week ended Dec.31 1932 was 1,698,150 barrels, compared with 2,025,700 barrels per day during the preceding week, an average of 2,209,100 barrels per day during the week ended Jan. 2 DAILY AVERAGE PRODUCTION OF CRUDE OIL. (Figures in Barrels of 42 Gallons Each) Oklahoma Kansas Panhandle Texas North Texas West central TOXINS West Texas East central Texas East Texas Southwest Texas North Louisiana Arkansas Coastal Texas Coastal Louisiana Eastern (not Including Michigan) Michigan Wyoming Montana Colorado New Mexico California Week Ended Dec. 31 1932. Week Ended Dec. 24 1932. 356,900 89.850 44,450 47,300 24,250 156,550 50.150 a 52,200 29,250 32,800 131,150 33,950 92,950 17,500 29,850 5,900 2,700 27,850 472.600 397,450 92,800 44,100 47,400 24,400 156,550 49,600 283,450 51,200 28,650 33,200 132,400 34,100 91,450 17,250 32,300 5,450 2,500 27,850 473,700 Average 4 Weeks Ended Dec. 31 1932. 380,450 91,050 46,050 47,600 24,550 159,850 50,400 242,000 52.450 28,800 33.150 133,250 34.200 94,700 17,700 31,550 5,600 2,600 27,850 473.150 Week Ended Jan. 2 1931. 493,300 103,150 49,800 50,050 24.150 172,950 50.950 290,900 52,100 27,800 33,700 114,700 29,850 107.950 17,100 37,350 6,500 3,850 43,250 499.700 1.698,150 2,025,700 1,976.950 2.209.100 Total a East Texas figure covers week Dec. 20-26. both inclusive. AND GAS AND FUEL CRUDE RUNS TO STILLS. MOTOR FUEL STOCKS OIL STOCKS. WEEK ENDED DEC. 31 1932. (Figures in Barrels of 42 Gallons Each) Batty Refining Capacity of Plants. District. East Coast Appalachian Ind., Ill., Ky.__ Okla., Kan., Mo. Inland Texas.-Texas Gulf Louisiana Gulf No. La.-Ark_. Rocky Mountain California 644,700 144,700 434,900 459,300 315,300 555,000 146,000 89.300 152,000 915,100 • Motor Fuel Stocks. Gat and Fuel Oil Total. % Daily OPor%. Average. wed. 638.700 135,000 424,000 390,000 177,700 542,000 142,000 79,000 138,000 866,100 99.1 438,000 68.6 12,683,000 8,157.000 823,000 69,000 51.1 1,809,000 95.0 97.5 248,000 58.0 6,963,000 3,387,000 84.9 188,000 48.2 4,845,000 2,755.000 77,000 43.3 1,544,000 2,045,000 58.4 97.7 422,000 77.9 6,046,000 7.595.000 71,000 50.0 1,393.000 2,852,000 97.3 473,000 304.000 42,000 53.2 88.5 466,000 23,000 18.7 1.142,000 90.8 94.6 435,000 50.2 15,610,000 99,283,000 Reporting. Potential gale. Crude Runs to Stills. stocks. Totals weeks: 000 127,636.000 Dee.31 1932._ 3.856,3003.532.500 91.6 2.011,000 56.9 ,52339 n.r. 24 1o22 2 050.30n 3.532500 91.6 2.085.000 59.0 51.070.000 128.370.000 U. S. Bureau of Mine; a Below is set out an estimate of total motor fuel stocks on 1931 Bureau basis for week of Dec. 31 1932, compared with certain December figures: barrels 53,430,000 A.P. I. estimate B.& M. basis, week Dec. 31, 1932.1, 51,995,000 barrels U. B. B. of M. motor fuel stocks, Dec. 1 1931 barrels 56,171,000 B. of M. motor fuel stocks. Dec. 31 1931 U which is of b Estimated to permit comparison with A. P. I. Economies reports, Bureau of Mines basis. terminals, 1,164.000 c Includes 34,985,000 barrels at refineries, 11,690,000 at bulk barrels in transit, and 4,500,000 barrels of other motor fuel stocks. Oil Production in Texas Limited to 757,150 Barrels Daily by Texas Railroad Commission-Output Reduced 31,850 Barrels by Order Effective Jan. 1East Texas Field Allowable Cut to 290,000 Barrels. An aggregate production allowable of all Texas oil fields was fixed at 757,150 barrels dficly by the Texas Railroad according to Associated Commission on Dec. 31, whioh Press advices from Austin, Jan. 1, a reduction of 31,850 barrels daily under the most recent State statutory conservation agency. Regarding the allowable in the East Texas field, the advices, as noted in the Houston "Post," said: one of The allowable for the East Texas field, Texas' largest pool and barrels the most prolific ever uncovered in the world, was fixed at 290,000 daily. All orders are effective at 7 a. m. Jan. 1 1933. The East Texas allowable was based on a per well and bottom bole pressure arrangement. The Commission said that the per well production under that plan would be a minimum of 28 barrels per well and a maximum of 35 barrels per well, this allocation being rated on a bottom hole pressure ranging from 1000 pounds to 1500 pounds per well. a Until the East Texas per well allocation can be determined definitely, Chief of production of 28 barrels per well will be permissible. R. D. Parker, said. the Oil and Gas Division of the Railroad Commission 40 Financial Chronicle When the East Texas wells were closed in that area a production of 310,000 barrels daily was permitted, based on a combin ation of per well, bottom hole pressure and acreage. There had been much dissatisfaction with the acreag e phase of the formula. The commission eliminated consideration of acreage. Changes in Other Fields. The Yates field allowable was cut, from 65,000 barrels daily to 60.450; Van was cut from 42,500 to 39,500; Conroe was cut from 20.000 to 18.500; Rabbs Ridge from 10,000 to 9,000; Barber's Hill from 19,100 to 17,800 and Sugarland from 8,000 to 7.500. Other field allowables remained the same as follows Racoon Bend, 4.500 and High Island. 6.500 in the Gulf Coast field; Panhandle. 43.500; North Texas, 50,000; West Central Texas, 27.500; Winkler. 25,000; Crane-Upton, 12,000; Duval, 6,755; Salt Flat, 6.500; Howard-Glasscock, 14,000; Ector, 4,000; Reagan County, 20,000; Darst Creek, 14,000; Goose Creek, 3,200; Hull, 5,500; Humble, 5.125; Pettus, 3,800; Pierce Junction, 4.700; Refugi o, 7.700; Spindletop, 2,700. Actual nominations for all fields in the State, allowing for the eliminations In the East Texas nominations, were listed at 830,559 barrels daily. The previous Statewide allowable was approximately 780,000 barrels daily, of which 310,000 barrels was allotte d to East Texas. Wells in the East Texas field resumed produ ction on Jan. 1 after a shutdown since Dec. 17. The closing of the field, which was ordered by the Railroad Commi ssion for the expressed purpose of obtaining data neede d in drawing up the new measure, was noted in our issue of Dec. 24, page 4293. Plan to Curtail Oil Production Accep ted by Operators of Signal Hill in California—Ninety-Da y Program Adopted to Prevent Price Collapse. Overproduction of oil in certain Los Angel es (California) Basin fields, which threatened to wreck the State-wide oilcurtailment program, is expected to be reduc ed within the next 90 days to permit the oil industry to enjoy the present price structure, states the Los Angeles "Tim es" of Dec. 31, adding: At a meeting of Signal Hill oil field operato rs held Dec. 30, they unanimously voted to adopt a 90-day progra m and curtail to the desired level of 59,000 barrels of oil per day. The field has been running over its allowable approximately 9,000 barrels daily. Oil Umpire Pemberton says. Every attempt will be made during the period to keep the field within its limit. V. R. G. Wilbur, Chairman of Signal Hill operators and other leading oil men, strongly appealed to the operato rs on Dec. 30 to get into line. It was announced that many of the field's operators guaranteed to reduce their production to meet the quota. A proposal to shut the field in entirely for 10-day periods is being considered. The operators were informed that they might expect the sharpest cut in the price of crude oil and gasoline in the history of the oil industry should overproduction upset the curtailment program. Major companies, it was declared, may no longer make purcha ses, but will only handle their own production, unless the allowable is observ ed. Certain Santa Fe Springs operators have agreed to limit their production In the future and thus lend considerable strengt h to the drive to reduce the State's oil output. A co-operative plan is being worked out by the 'Cattleman North Dome Association,the Standa rd Oil Co.and other independent operators for Kettleman Hills. 110, Nearly two-thirds of the Signal Hill operato rs met Dec. 30 in the council chamber at Long Beach to talk over the situati on. Chile Hopes to End Importation of Oil—Gove rnor Confirms finding of Important Deposits in the Magallanes Territory. A cablegram Dec. 30 from Santiago, Chile, to the New York "Times" said: Telegraphic information from the Governor of Magallanes Territory concerning the rediscovery of oil close to the Tres Puentes deposits abandoned months ago after unsuccessful investigation has once again awakened interest in government and business circles. These reports confirm the existence of oil, which poured abundantly to the surface in the presence of officials. Samples examined prove the excellent qualities of the oil, while a survey of surrounding areas seems to indicate that the deposits are important. The Governor's report is credited with unusual significance, since repeated statements have been made by workers and Chilea n engineers who aided in the investigation of the Tres Puentes district that the Belgia n commission then entrusted with exploitation work had maliciously uncove red wells, endeavoring to convince the government that oil did not exist there in commercial volume. Officials see in the present report a possibility of Chile's being able to obtain all her oil requirements without importation. Russia Leading Foreign Oil Producers. Outside of the United States, Soviet Russia, with Sakha lin, a strip of Russian territory lying next to the northernmost boundary of Japan, lead the world in petroleum produ ction, followed in order by Venezuela, Rumania and Persi a, according to figures compiled in the U. S. Commerce Depar tment's Minerals Division. The Department's advices Dec.6 also said: Rumania, predominantly an agricultural country in central Europe, is third largest of the foreign producers, shifting places from month to month with Persia. also an agricultural country but an important producer of the world's petroleum. Complete figures are available for all producing countries for the period from January to June 1932, but only partly complete for the period from January to September. inclusive. However, the most import ant producers have completed production returns, and are as follows; For the January through September period. U. S. S. R. and Sakhal in, 120.160.623 barrels; Venezuela, 88.287,647 barrels; Rumania, 36.913 ,929 barrels; Persia, 35,981.989 barrels, and Mexico, 24,633.872 barrels. It is possible that the total for Netherland India, an important producer, would Jan. 7 1933 affect the position for Mexico,but figures have not been received for Augus and September production. United States production for the period was 595,198,000 barrels. The ranking for the January through June period is as follows; U.S. S. R. and Sakhalin, Venezuela, Persia, Rumania, Netherland India and Mexico , as the five leading foreign producers. For July the list was U. S. S. It. and Sakhalin, Venezuela, Persia and Ruman ia; while that for August was in the same order. Nickel Industry in 1932—World Consumption in First Nine Months of Year Slightly Over 40,000,000 Pounds, Compared with More Than 56,000,000 Pounds in Same Month Previous Year. It is noted by Robert C. Stanley, Presi dent of the International Nickel Co. of Canada, Ltd., that "world consumption of nickel for the first nine months of 1932 slightly exceed 40,000,000 pounds, as compared with slight ly more than 56,000,000 pounds for the same period in the previous year." "Despite this decrease in total volume," he says, "four nickel alloys have shown this year incre ases in use over the figures for 1931. Two of these were nickel cast iron alloys, another was nickel-clad steel plate, and the fourth was a special chrome-nickel alloy developed for dairy use." Mr. Stanley, in making these observatio ns in reviewing the nickel industry in 1932, also says: The nickel business has become one of the basic industries of the world, which rise and fall with the tide of general business. This is demonstrated by the low point which nickel consumption reached last spring, and by the slow but persistent recover y which it has experienced In the last few months. Whether it will continue this advance in 1933 thus depends on what fate has in store for world business as a whole. Certainly there have been no developments this year to imply either that nickel can forge ahead Independently of world recovery, or that It will drop behind. At the same time, the diversity of uses to which nickel in Its various forms is now being put in our industrial world indicates the broad basis on which this metal will participate in any general recovery. Mr. Stanley says that "the current agitat ion for the legalization of beer in the United States may have a bearing on the future of nickel." He adds: "During the past 12 years that American breweri es have been marking time, progress in the technology of brewin g has been made in Canada and Europe, and the trend is definitely toward the white metal alloys for fermentation vats, storage tanks, shipping containers, piping and various other equipment. The prospect that brewing may again become an import ant industry in the United States has already stimulated inquiries which indicate that nickel will benefit by a revival of brewin g. "From the technical standpoint 1932 is notable as the first full year in which the International Nickel Co.'s modernized plants have been in operation. Although these properties have been operated at much less than capacity, they have demonstrated econom ies and efficiency of real premise." American Live Stock and Meat Packing Industry in 1932—Tonnage Volume and Employme nt Maintained. The American live stock and meat packi ng industry in 1932 kept up its tonnage volume, maint ained employment -at a relatively high level, and contribute d a normal quota of business to the agencies of transportation, Wm. Whitfield Woods, President of the Institute of Ameri can Meat Packers, stated on Dec. 29, in a.review of the year. "Although prices were low and profits were small, and in some cases lacking, consumption of meat showed little chang e as compared with the last two years," he said. Mr. Wood s continued: Wholesale prices of most meat products are about half the prices existed two years ago and sharply lower which than they were last year at this time. Smoked hams, for example, are from 53 to 60% lower at wholesale than they were two years ago and 27 to 32% lower than they were last year, the declines varying with the weight and grade. Fresh pork loins are wholesaling 53% lower than two years ago and 10 to 16% year ago. Other declines in the lower than a wholesale prices of meats have been as follows: As As Compared Compared with Two with One years Year Ago. Ago. As As Compared Compared with Two with one Years Year Ago. Apo. Fresh pork shoulders —55% —17% Dry salt bellies, 16 to Fresh butts, Boston 20 pound average- —68% style —58 —40% —15 Lard Bacon, smoked, 6 to —53 —32 Beet, choice 8 pound average —33 —57 —26 —26 Beef, good Bacon. smoked, 8 to —40 —26 Veal, choice 10 pound average- —53 —45 —13 —25 Lamb, choice Picnics, smoked_ _ -- —56 —19 +12 —33 Exports of meat, which consist almost entirely of pork products, sharply during the year. Export s of lard, however, showed declined little change. relatively The application of quotas on imports and restrictions on European countries which previou exchange by sly had been important American meats were circumstances in the export situation. customers for In the United Kingdom, which is the greatest foreign market for American pork products, the Government recently has requested American and other packers to limit their shipments non-British temporarily and is now recommendation made by the British working on a Pig Indust ry Reorganization Commission that a compulsory quota be established. Germany, Poland and Austria have dollar exchange quotas duties as well on some pork and import products. France has quotas as well as duties. Italy has duties. Cuba and Mexico have very high duties, particularly on lard. Volume 136 Financial Chronicle The reports of the United States Department of Agriculture indicate that marketings of dive stock during the first part of 1933 will continue to be slightly less than in the corresponding period of 1932. Supplies are fully adequate for the demand. Relatively larger hog marketings in the on:miner of 1933 are considered probable as a result of an expansion of production that has been encouraged in recent months by the large crop of cheap feeds produced thin year. Inquiry 41 In London. The pressure abroadTwas'attributed in some directions t selling for the group. The decline was followed by some fair consumer buying here. About 350 tons were bought at prices ranging from 21.70 to 21.80 cents. The December statistics were accepted as favorable, the world's visible supply of tin at the end of the month being estimated by the National Metal Exchange at 45,796 long tons, against 47,471 tons a month previous. and 51,313 tons in December 1931. United States deliveries in December came to 2,645 tons, against 3,240 tons aTmonth previous. 114 Chinese tin, 99%, prompt shipment, closed as follows. Dec. 29. 21.65 Jan. 2, holiday; Jan. 3, cents; Dec. 30, 21.65 cents; Dec. 31, 21.65 cents; 21.40 cents; Jan. 4, 20.65 cents. for Lead Shows Improvement-Domestic Copper Dull-Silver Advances. "Metal and Mineral Markets" for Jan. 5 reports that buying interest in lead revived materially in the last week, Daily Pig Iron Output Off 16% in December. but most of the other items of consequence continued quietthat is, so far as the domestic market was concerned. CopDecember production of coke pig iron was 546,080 gross per sold in fair volume abroad, resulting in a moderate uplift tons, compared with the November total of 631,280 tons, In prices in that territory. Domestic sellers of zinc and according to the "Iron Age" of Jan. 5. The December daily lead entertained steady views on evidence that consumers rate at 17,615 tons showed a loss of 16.3% from the Novemare not well covered to supply their modest present-day ber rate of 21,052 tons daily. The output for 1932 totaled requirements. Tin came in for increased attention yes- 8,686,443 tons, against 18,275,165 tons for 1931, or a loss of terday,following a decline in the London market which some 52.4%. The "Age" continues: operators interpreted as selling by the group. Silver moved Furnaces in operation on Jan. 1 numbered 42, making iron at the rate of upward on speculative demand,inspired partly by the feeling 15,810 tons daily, against 51 on Dec. 1, with a daily operating rate of tons. Ten furnaces were put out or banked during December and that Congress may yet do something to change the present 20.860 one blown in, making a net loss of nine furnaces. The furnace put in operstatus of the metal. Platinum was lowered to $28 per ounce ation belonged to an independent steel company. Four merchant furnaces. by the leading seller, effective Jan. 3. Demand for platinum four independent steel company furnaces and two corporation furnaces were blown out or banked. Most of them were banked over the holidays and has been very quiet for some months, and opinion in the will probably resume shortly. Among the furnaces blown out or banked are the following: A Donner foreign sales pool on how to stimulate activity is said to furnace and a Pioneer furnace of the Republic Steel Corp.; two furnaces of be divided. The same publication adds: the Woodward Iron Co.; one Aliquippa, Jones & Laughlin Steel Corp.; one Copper Unchanged. The close of the old year and the beginning of 1933 saw little if any change in the status of the copper market. Domestic prices continued at 5 cents per pound. delivered Connecticut, for prompt and near-by metal, and at 53,g cents for second-quarter business. Actual trading. however, was almost at a standstill, as in the preceding week, with the low price level eliciting practically no interest on the part of consumers. On the other hand, some improvement has been reported in shipments against average-price contracts since the beginning of the new year. In a new price list, effective Jan. 2, that the American Brass Co. has issued, the former prices with numerous successive discounts have been replaced by new prices based on a 531-cent level. Prices of the former list were based on a 651-cent level. In the foreign market a fair volume of business prevailed throughout the week, with prices slightly above those of the preceding seven-day Period. Cable reports received during the week lend confirmation to the belief that leading foreign producers may shortly be expected to reach an agreement relative to production quotas for 1933, which quotas will undoubtedly be in line with current foreign needs. Owing to a reduction in ocean freight rates from $4.25 to $3.75 per long ton, beginning Jan. 1 1933, the premium that the cit. price commands above the refinery basis has been changed from 0.30 cents to 0.275 cents. effective that date. Exports of refined copper from the United States during November and the first 11 months of 1931 and 1932, by countries, according to the United States Department of Commerce, were as follows. Nov Jan.-Nov. Jan,-Nov. 1932. 1931. 1932. Short Tons. Short Tons. Short Tons. Canada 26 3.557 91 Chile 4 Belgium 611 11,774 6,165 France 2,001 52,040 29,416 Germany 1,122 27,393 14.278 Great Britain 45,762 29,779 Italy 401 19,539 12,655 Netherlands 219 8,688 3,833 Sweden 819 14,145 7,122 China and Hong Kong 56 2,972 800 Japan 94 224 Soviet Union 3,870 British India 837 Other countries 168 219 2,901 3.308 Totals 5,474 193,576 107.839 Lead Steady. Though demand for lead appeared to be spotty in that the business placed was not evenly distributed, the fact remains that a fair tonnage was purchased during the week and prices were well maintained in all directions. Business in the East was booked at 3 cents, New York, the contract basis of the American Smelting & Refining Co., and in the Middle West at 2.875 cents, St. Louis. More than one producer has been able to dispose of current intake. Inauiry for January and February shipment lead has increased, contrasted with recent weeks. Sales booked so far for January shipment metal total about 9,000 tons. Sales made during November and December average about 18.000 tons a month. Industrial activity is proceeding at about the same level as recently and increased buying of lead for shipment during the current month is generally expected. In the last week some fair buying took place for account of corroders, battery makers, foil manufacturers, and miscellaneous interests. Cable makers appear to be doing next to nothing, owing to the inactivity of utilities. Prices of lead pigments were reduced during the week by leading producers. Lead averaged 3.180 cents, New York, during 1932, against 4.243 cents In 1931. Zinc Price Holds. Demand was slow in the zinc market last week, the few sales that were made being mostly carload lots for prompt or nearby shipment. The price level continued at 3.125 cents, St. Louis, with producers showing no Inclination in the time to depart from that basis. Sales for the calendar week ended Dec. 31, according to statistics circulated in the industry, totaled about 1,500 tons. Zinc, from a world standpoint, appears to be making some progress statistically. Stocks at the end of November (United States and foreign cartel) totaled 282,957 short tons, against 288,608 tons in October, and 315,821 tons in July of this year. Tin Price Declines. The market suffered a net loss of about 1 cent per pound during the last week, most of the decline taking place yesterday, following a sharp break Ohio furnace, Carnegie Steel Co.; one Toledo stack, Pickands. Mather & Co.; one Portsmouth stack. Wheeling Steel Corp.; Jisco furnace, Jackson Iron & Steel Co.; one South Chicago unit, Illinois Steel Co. The M. A. Hanna Co. started up one of its Detroit furnaces. PRODUCTION OF COKE PIG IRON AND OF FERROMANGANESE. (Gross Tons.) Pig Iron.: 1931. January February March April May June Half year July August September October November December Ferroenanganess.r 1932. 1932. 1931. 1,714,266 1,708,821 2,032,248 2,019,529 1,994,082 1,638,627 972,784 964,280 967,235 852,897 783.554 628.064 14,251 19,480 27,899 25,456 23,959 11,243 11,105.373 1,483.220 1,280,526 1,168,915 1,173,283 1,103,472 980.376 5,168,814 572,296 530,576 592,589 644,808 631,280 546.080 122,288 17,776 12,482 14,393 14,739 14,705 15,732 11,250 4.010 , 4,900 481 5.219 7,702 33,562 2,299 3.414 2,212 2,302 5.746 7,807 8,686,443 Year 18,275,165 212,115 57,342 Theee totals do not include charcoal pig iron. The 1931 production of his Iron was 48.213 gross tons. y Included 10 pig iron figures. DAILY RATE OF PIG IRON PRODUCTION BY MONTHS-GROSS TONS. • Steel MerWorks chants • Total 1930January February March April May June July August September October November December 1931January February March April May 71,447 81,850 83,900 85.489 84,310 77.883 66.949 64,857 83,342 57,788 49.730 40,962 19,762 91,209 19,810 101,390 20,815 104,715 20.573 106,062 19,973 104,283 19,921 97,804 18,197 85,146 16,560 81,417 13,548 75,890 12.043 69.831 12,507 62,237 11,780 53,732 46,883 49,618 54,975 53,878 51,113 AR AAR 9,416 11,332 11,481 13,439 13,212 11 9n0 55,299 60,950 65,558 67,317 64.325 54 591 Mer- Total Steel Works chants• 1931July August September October November December 1932January February March April may June July August September October November 1-1.....mhar 35,189 12,012 47.201 31,739 9.569 41.308 29,979 8.985 38,964 30,797 7,051 37,848 31.024 5,758 36,782 24,847 6,778 31.625 25,124 25,000 24.044 23,143 20,618 14,845 15,132 14,045 16,540 16,814 16,607 13.041 8,256 7,251 7,157 5,287 4,658 6,090 3,329 3,070 3.213 4,286 4,435 3.874 31,380 33,251 31,201 28.430 25,276 20.935 18,461 17,115 19,753 20.800 21.042 17.818 • Includes pig iron made for the market by steel companies. DAILY AVERAGE PRODUCTION OF COKE PIG IRON IN THE UNITED STATES BY MONTHS SINCE JAN. 1 1927-GROSS TONS. January February March April May June First six months_ _ July August September October November December 12 mna. averforo 1927. 1928. 1929. 1930. 1931. 1932. 100,123 105,024 112.386 114,074 109,385 102,988 107,351 95,199 95.073 92,498 89,810 88,279 86,960 90.26(1 92,573 100,004 103,215 106,183 105.931 102,733 101,763 99,091 101.180 102,077 108,832 110,084 108,705 103.382 111,044 114,507 119,822 122,087 125,745 123,908 119,564 122,100 121,151 116,585 115,745 108,047 91,813 115.551 91,209 101,390 104,715 106,062 104.283 97,804 100,891 85,146 81,417 75,890 69,831 62,237 53,732 56.025 55,299 60,950 65,558 67,317 64,325 54,621 61,356 47,201 41,308 38,984 37,848 36,782 31,625 50.060 31,380 33,251 31,201 28,430 25,276 20,935 28,412 18,461 17,115 19,753 20,800 21,042 17,618 23.772 Steel Production Up 1% to 14% of Capacity-Pig Iron Output Declined in December-Steel Scrap Price Lower. Final figures on pig iron production for December, as compiled from returns from producers, were even more discouraging than preliminary estimates, reports the "Iron Age" of Jan. 5. Output last month was 546,080 tons, or 17,615 tons a day, as compared with 631,280 tons, or 21,052 tons daily, in November. The daily average barely exceeded the depression low of 17,115 tons, reached in August, and 42 Financial Chronicle showed a decline of 16.3% from the November rate. Ten furnaces were put out or banked .during December and one was blown in, making a net loss of nine stacks. Part of this loss in active furnaces is accounted for by holiday banking and will probably be offset by early resunaptions, continues the "Age," further stating: Pig iron production for 1932 was 8,686,443 tons, the lowest output since 1896 and a decline of 52 4% from the 1931 total of 18,275,165 tons. Furnaces in operation on Jan. 1 numbered 42, making iron at the rate of 15.810 tons daily, compared with 51 active stacks on Dec. 1, producing at the rate of 20,860 tons a day. Aside from increased tin plate specifications and heavier releases from the automobile industry, the new year opened with few indications of an Impending seasonal rise in iron and steel bookings. Little replenishment buying has yet put in an appearance, although in Ohio some finished steel tonnage was placed for shipment on Dec. 31, thus permitting both seller and buyer to escape the State tax on inventories. Fabricated structural steel awards for the week were unusually large-67,000 tons-but this total was accounted for in large part by the formal award of 60,000 tons for a single project, the New Orleans Belt Line bridge. In general,structural steel prospects are regarded as less favorable than a year ago, in view of a probable decline in public works construction and the absence of a compensating increase in private building work.. Unless steel demand from miscellaneous sources shows a gain similar to that of last autumn, it seems likely that mills will remain, for some time, dependent on the motor car and container industries for their main support. These two influences are almost entirely responsible for a rise in steel ingot production from last week's rate of 13% to a current average of 14%• Among the steel producing districts, the Cleveland territory and the Valleys alone registered gains, the Cleveland rate rising from 26 to 35% and the Valley average from 10 to 15%. Detroit maintained its comparatively high rate of 34%, and the Wheeling district continued on a 30% basis, while Buffalo operations dropped from 16 to 12%. Pittsburgh and Chicago operations remained unchanged at recent low levels of 12 and 9% respectively. The motor car industry maintained its schedules through the holidays with little interruption, and its operations in January are expected to fulfill recent forecasts of an increase over those of December. The Chrysler Corp. will shortly place steel for its requirements after Jan. 15, and this tonnage will further bolster the production of those mills which specialize In automobile materials. Chrysler's January schedule calls for about 25,000 cars, of which 15,000 will be Plymouths. Chevrolet's production will total approximately 55,000 cars, while the Ford company is reported to be going on a schedule this week of 1,000 units a day live days a week. The price situation remains sensitive. Cold-rolled strip is more commonly available in large lots at 1.90c. a lb., or $2 a ton below the recent ruling minimum. No. 24 hot-rolled annealed sheets and No. 20 cold-rolled have been subject to more frequent concessions, and prices of plates and reinforcing bans continued unsettled, particularly along the Eastern seaboard. A decline of 50c. a ton in heavy melting steel scrap at Pittsburgh brought down the "Iron Age" composite price for scrap steel to $6.75 a gross ton from $6.92 a week ago. The composite prices for finished steel and pig Iron are unchanged at 1.948e. a lb. and $13.58 a gross ton respectively. THE "IRON AGE" COMPOSITE PRICES. Finished Steel. Jan. 3 1933. 1.948e. a Lb. Based on steel bars, beams, tank plates, One week ago 1.9480. wire, rails, black pipe and sheets. One month ago 1.948e. These products make 85% of the One year ago 1.945o. United States output. High. Low. 1932 19770. Oct. 4 1.926e. Feb. 2 1931 2.037c. Jan. 13 1.9480. Dec. 29 1930 2.273c. Jan. 7 2.018e. Dec. 9 1929 2.317e. Apr. 2 2.2830. Oct. 29 1928 2.2860. Dec. 11 2.217e. July 17 1927 2.402e. Jan, 4 2.2120. Nov. 1 Pig Iron. Jan. 3 1933. $13.56 a Gross Ton. Based on average of bade Iron at Valley week ago One $13.56 furnace foundry Irons at Chicago One month ago 13.59 Philadelphia, Buffalo. Valley and BirOne year ago mingham. 14.81 Hinh. Low. 1932 $14.81 Jan. 5 $13.56 Dec. 6 1931 15.90 Jan. 6 16.79 Dec 15 1930 18.21 Jan. 7 15.90 Dec. 16 1929 18.71 May 14 18.21 Dec. 17 1928 18.59 Nov. 27 17.04 July 24 1927 19.71 Jan. 4 17.54 Nov. 1 Steel Scrap. Jan. 3 1933, 86.75 a Gross Ton. (Based on No. 1 heavy melting stee ago week One $6.92I quotations at Pittsburgh, Philadelphia One month ago 6.92j and Chicago. One year ago High. Low. 1932 $8.50 Jan. 12 $66.42 July 5 1931 11.33 Jan. 6 7.62 Dee. 29 1930 15.00 Feb. 18 11.26 Dec. 9 1929 17.58 Jan. 29 14.08 Dec. 3 1928 16.50 Dec. 31 13.08 July 2 1927 15.25 Jan. 11 13.08 Nov.22 "Steel," of Cleveland, in its summary of the iron and steel markets on Jan. 3 stated: Shaking off its holiday encumbrance, the iron and steel industry was scheduled to start the new year at an operating rate of about 14%, regaining the pace of mid-December and possibly recovering to an average of 15% for the week ended Jan. 7. There is additional encouragement, as the year opens, from the indication that, although for a few days around Christmas the steel rate broke through the previous 1932 low of 12%. December as a month was not pulled down to the alltime low of August. The industry embarks upon the first quarter confident that it is on the threshold of a period of moderate recovery. It is mindful that backlogs have never been so thin, and that January will lack the sustaining rail tonnage which usually gets the month away to a good start. Yet there is an underlying sentiment that principal consumers of iron and steel certainly will take no less than in 1932 and probably will specify more. And due to wage reductions and other economies, and concentration of production in low-cost plants, unit costs are less than a year ago. Due largely to automotive releases. the Cleveland district opens the week at 29%, highest for the country. Pittsburgh is scheduled to expand from 10ti% to about 14%, Birmingham will rise from 10% to 15-18, while eastern Pennsylvania will probably lift a point or two above the current 8-9% rate. For the latter district operations of 15 to 16% are forecast later in the month. Jan. 7 1933 Only from the automobile industry have actual releases of material the past few days been encouraging, and this business centres in Chevorlet, Chrysler and Ford. Officially, the new 2.20c. Pittsburgh, price on No.24 hot rolled annealed sheets, an advance of $2. is effective. Tin plate mills have stepped up to an average operation of 40%. The Standard Oil Co. of New Jersey has placed its 1933 contract requirements, approximating 6,500 tons. Largest rail inquiry before mills is that of the New York Board of Transportation for 6,680 tons of standard and 400 tons of guard rails, with commensurate fastenings. Other carriers in the market for fastenings are the Santa Fe, Boston & Maine, and Atlantic Coast Line. A buyer of basic pig iron has closed on 4,000 to 5.000 tons at Pittsburgh for January delivery, and probably will repeat for February. Chicago furnaces expect further business in January from small foundries. St. Louis reports Improved demand for coatings for brewery equipment. Bar iron wage rates for January and February are reduced from $9.30 to $9.05 per ton, sensitive to the weaker market. Effective Jan. 1, the H. C. Frick Coke Co. reduced wages 15% at its six coal mines being operated in the Connellsville district. Structural steel awards for the week ended Dec. 30 totaled 9.533 tons, about half the weekly average for 1932. Bridges in New York State will take 5,000 tons. Concrete bar inquiry is featured by 5,000 tons for the Golden Gate bridge approaches at San Francisco and 3,000 tons for Illinois highway work. Due entirely to increased shipment of scrap, principally to Japan, exports of iron and steel rose 14,815 tons to 56.041 tons in November. Imports increased only 1,231 tons to 34,924 tons, thus enabling November to improve the favorable balance. Canada and Japan in November almost doubled their October purchases of Iron and steel from the United States. The $2 rise in No. 24 hot rolled annealed sheets puts the iron and steel composite of "Steel" up 8 cents this week to 828.99, and the finished steel composite up 20 cents to $46.90. The steelworks scrap composite is unchanged at $6.29. Steel ingot production in the week ended Monday (Jan. 2) s placed at a shade over 133%, according to the "Wall Street Journal" of Jan. 4. This compares with about 12%% in the preceding seven days and more than 143% two weeks ago. This showing, better than anticipated by steel interests, indicates that the shutdowns over the New Year holiday were not as extensive as those over Christmas, adds the "Journal," which further goes on to say: The U.S. Steel Corp. is credited with a rate of approximately 13%, against a little under 12% in the previous week and 15% two weeks ago. Leading independents are at nearly 14%, compared with 13% a week ago and 1435% two weeks ago. In the corresponding week of last year the average rose 134% to a shade under 22%. U. S. Steel was up fractionally at 22%, while independents rose almost 3% to 2134%. Comparative figures follow; Average. U. S. Steel. Independents. Corresponding week, 1931 36% 41% 32% Corresponding week, 1930 59% 61% 58% Corresponding week, 1929 84% 87% 81% Corresponding week. 1928 70% 73% 68% Bituminous Coal Output Continues to Reflect Stimulated Demand - Anthracite Production Again Advances. According to the United States Bureau of Mines, Department of Commerce, there were produced during the week ended Dec.24 1932 a total of 7,680,000 net tons of bituminous coal and 1,452,000 tons of anthracite as compared with 7,838,000 tons of bituminous coal and 1,237,000 tons of anthracite during the preceding week and 5,331,000 tons of bituminous coal and 706,000 tons of anthracite during the corresponding period in 1931. During the calendar year to Dee. 24 1932, production, according to estimates, reached a total of 299,766,000 tons of bituminous coal and 48,458,000 tons of anthracite as against 371,776,000 tons of bituminous coal and 58,767,000 tons of anthracite during the calendar year to Dec. 26 1931, The Bureau's statement follows: In spite of the loss of time at the mines on the day before Christmas, production of bituminous coal during the week ended Dec. 24 1932 contlnued to reflect the stimulated demand shown in the preceding week. The total output is estimated at 7,680,000 net tons, a decrease of 158.000 tons, or 2%. Production during the pre-holiday week in 1931 (Dec. 14-19) amounted to 7,056,000 tons. Anthracite production during the week ended Dec. 24 1932 reached a total of 1,452.000 net tons. This will doubtless stand as the high week for the year, since in the succeeding week, Monday the 26th was observed as as a legal holiday. Compared with the output in the preceding week, this is an increase of 204.000 tons, or 16.5%• Beehive coke production during the week of Dec. 24 1932 is estimated at 21.900 net tons, as against 22,500 tons in the week of Dec. 17 1932. ESTIMATED UNITED STATES PRODUCTION OF COAL AND BEEHIVE COKE (NET TONS). 1Week Ended, Dec. 24 Dec. 17 Dec. 26 1932.c I 1932.d I 1931. Calendar Year to Date. 1932. 1931. 1929. Bituminous Coal a Weekly total_ _ 7,680,000 7,838,00015,331,000 299,766,000 371,776,000 525,019,000 Daily average_ 1,280,0001,306,000 1,086,000 991,000 1,230,000 1,736,000 Penn. Anthracite Weekly total_ _ 1,452,0001,237,000 706,000 48,458,000 58,767,090 72,519,000 Daily average_ 242,000 206,200, 141,200 1,018.000 196,200 242,900 Bcehire Coke21,900 22,5001 15,800 Weekly total_ _ 756,600 1,257,000 6,395,800 Dally average_ 3,650 3.750 3,160 2,464 4,094 20,901 a Includes lieni e, coal made into coke, local sales, and colliery Mel. b Includes Sullivan County, washery and dredge coal, local sales, and colliery fuel. c Subject to revision. d Revised. 4a Financial Chronicle Volume 136 ESTIMATED WEEKLY PRODUCTION OF COAL BY STATES (NET TONS). INDUSTRIAL CONSUMPTION AND STOCKS OF BITUMINOUS COAL IN THE UNITED STATES.: Week Ended 187,000 92,000 215,000 1.050.000 335,000 102,000 210,000 660,000 275,000 33.000 10,000 66.000 37,000 68,000 450,000 1,632,000 73.000 12.000 144,000 204,000 37,000 1,495,000 338,000 105,000 8,000 185,000 71,000 147,000 950.000 265,000 88,000 174.000 524,000 222,000 35.000 10,000 56,000 25,000 61,000 362,000 1,582.000 67,000 11,000 92,000 176,000 34,000 1,280,000 315.000 90,000 6.000 365,000 107.000 252,000 1,306,000 382,000 112,000 162,000 737.000 243,000 72,000 16.000 68.000 40.000 44,000 489,000 2,250.000 113,000 46,000 115,000 227.000 53.000 1,578,000 560,000 121,000 12,000 Total bituminous coal•Pennsylvania (anthracite) 7,838,000 1,237,000 8,828,000 936,000 7,056,000 894,000 9.475,000 1,385,000 0 n7c 111111 7 764 nnn 7 AMI min in sfin nee I . . ..4. .. 'cmeo ,I .g.I. a.mc.,4-4,ze.,-4o o.1-4u-m.momA.wca 02-4 . . PPPere'P.P.P.P5 4 l'i".. bo Ob9Q982.2.9.9.009g0000gbobg Alabama Arkansas & 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_ Northern Wyoming • Other States Trital ^nal November 19321 October 1932 (Revised) (Preliminary) Dec. 17 1932. Dec. 10 1932. Dec. 19 1931. Dec.20 '30. 88886.6688888888888888888 State. Stocks of bituminous coal in the hands of industrial consumers increased .from 21,838,000 tons on Nov. 1 to 22.915,000 tons on Dec. I, a rise of 4.9% -during the month. Stocks of retailers normally decline slightly after Nov. 1. but no figures on retail yards will be available until the Bureau of Mines completes its quarterly survey on Jan. 1. The "industrial consumption" of bituminous also Increased, rising from 19,213,000 tons in October to 20,042,000 in November, a gain of 4.3%• A fairer comparison in matching a 30-day month against a 31-day month Is -the average rate per day, and on this basis November consumption shows a gain of 7.8% over October. Details are given in the following table, which bas been prepared under the co-operative agreement between the National Association of Purchasing Agents and the Bureau of Mines. % of change. Net Tons. Stocks, End of Month alElectric Dower utliities_a By-product coke ovens_b Steel and rolling mills_b Cement roill,s_b Coal-gas retorts_b Other industriaLc Railroad fuel_c 4,560.000 4,710,000 707,000 270.000 488.000 12,180,000 4,516,000 4,375,000 697,000 266,000 484,000 11.500.000 +1.0 +7.7 +1.4 +1.5 +0.8 +5.9 Total industrial stocks 22,915,000 21,838,000 +4.9 2,320.000 2,532,000 126,000 526,000 328,000 220,000 13,990,000 2,469,000 2,514,000 104,000 504.000 374,000 228.000 13,020,000 -6.0 +0.7 +21.2 +4.4 -12.3 -3.5 +7.5 20,042,000 19,213,000 +9.9 Industrial Consumption byElectric power utilities_a By-product coke ovens_b Beehive coke ovens_b Steel and rolling mills_b Cement mil's_ b Coal-gas retorts_ b Other industriaLc Railroad fuel_c Total "Industrial consumption" Net Tons. Additional Known CortiumptionCoal mine fuel Bunker fuel, foreign trade 292,000 104,000 I 311,000 117.000 -6.1 -11.1 Days Supply. Days Supply on Hand atElectric power utilities By product coke ovens Steel and rolling mills Cement mills Coal-gas retorts Other industrial Railroad fuel 59 days 56 " 40 " 25 " 67 " 31 " 21 " 57 days 54 " 43 " 22 " 66 " 34 " 21 " +3.5 +3.7 -7.0 +13.6 +1.5 -8.8 -2.9 35 " 34 " Total industrial a Collected by the U.S. Geological Survey. b Collected by U.S.Bureau of Mims c Estimate based on reports collected jointly by the National Association of Purchasing Agents and the U. S. Bureau of Mines from a selected list of 2,000 representative manufacturing plants and railroads. The concerns reporting are chiefly large consumers and afford a satisfactory basis for estimate. Subject to revision. a These monthly figures do not include retail dealers'stocks and deliveries. which are reported only Quarterly. (See Weekly Coal Report No. 800. page LI Neither do they include industrial anthracite or coal In Canada. Current Events and Discussions 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 decrease of $5,000,000 for the week. This decrease corresponds with an the coming Monday. The New York City statement, of increase of $19,000,000 in monetary gold stock and a decrease of $18.000,000 course, also includes the brokers' loans of reporting member In money in circulation, offset in part by an increase of $32,000,000 in banks. The grand aggregate of brokers' loans the present member bank reserve balances. Holdings of discounted bills increased 84.000,000 at the Federal Reserve week remain unchanged, the total of these loans on Jan. 4 Bank of San Francisco. and declined $9,000,000 at Atlanta, $4.000,000 at standing at $394,000,000, as compared with $331,1933 Cleveland. $3,000,000 at Philadelphia and $18.000,000 at all Federal Reserve banks. The System's holdings of bills bought in open market and 000,000 on July 27 1932, the low record for all time since -of United States Government securities show little change for the week. these loans have been first compiled in 1917. Loans "for Beginning with with statement of May 28 1930, the text own account" remain unchanged at $379,000,000, loans "for accompanying the weekly condition statement of the Federal account of out-of-town banks" at $12,000,000 and loans Reserve banks was changed to show the amount of Reserve "for account of others" at $3,000,000. bank credit outstanding and certain other items not included CONDITION OF WEEKLY REPORTING MEMBER BANKS IN CENTRAL RESERVE CITIES. in the condition statement, such as monetary gold stocks and New York. money in circulation. The Federal Reserve Board's explanaJan. 4 1933. Dec. 28 1932. Jan. 6 1932. tion of the changes, together with the definition of the dif7,037,000,000 7.020.000,000 7,039,000.000 ferent items, was published in the May 31 1930 issue of Loans and investments-total 3.433.000,000 3,450,000,000 4,472,000,000 Loans-total the "Chronicle," on page 3797. The statement in full for the week ended Jan. 4, in com1,584,000,000 1,612,000.000 2,223.000,000 On securities 1,849,000,000 1838,000,000 2,249,000,000 All other parison with the preceding week and with the corresponding • date last year, will be found on subsequent pages, namely, Investments-total 3 604.000,000 3,570.000,000 2,567.000.000 122 and 123. 2 502,000,000 2,481,000,000 1,722,000,000 U. S. Government securities 1,102,000,000 1,089,000,000 845,000,000 Other securities Changes in the amount of Reserve bank credit outstanding .and in related items during the week and the year ending Reserve with Federal Reserve Bank.---1,052,000,000 1,103,000,000 705,000,000 52,000,000 44,000.000 42,000,000 Cash in vault Jan. 4 1933, were as follows: The Week with the Federal Reserve Banks. The daily average volume of Federal Reserve bank credit -outstanding during the week ending Jan. 4, as reported by the Federal Reserve banks, was $2,152,000,000, a decrease •of $37,000,000 compared with the preceding week and an increase of $219,000,000 compared with the corresponding week in 1932. After noting these facts, the Federal Reserve Board proceeds as follows: On Jan. 4, total Reserve bank credit amounted to 12,163,000.000, a Bills discounted Bills bought U. S. Government securities -Other Reserve bank credit Inman (+) or Decrease (-) Since Jan. 4 1933. Dec. 28 1932. Jan. 61932. : $ $ 251,000.000 -16,000,000 -567,000,000 33.000,000 -242,000,000 +1,085,000,000 1,851,000,000 -32,000,000 29,000,000 +12,000,000 TOTAL REEI'VE BANK CREDIT..2,163.000.000 -5,000,000 4,524,000,000 +19,000,000 Monetary gold stock 1 898,000,000 Treasury currency adjusted 5 669,000,000 -18.000,000 Money in circulation 2 514,000.000 +32,000,000 •Member bank reserve balances 'Unexpended capital funds, non-mem402,000,000 ber deposits. dec +242,000.000 +66.000.000 +123.000,000 +8.000,000 +478,000,000 -54,000,000 Returns of Member Banks in New York City and Chicago--Brokers' Loans. Beginning with the returns for June 1927, the Federal Reserve Board also commenced to give out the figures of Ithe member banks in New York City, as well as those in Net demand deposits Time deposits Government deposits 5 733,000,000 5,728,000,000 5,148,000,000 894,000,000 883,000,000 775,000,000 133,000,000 163,000.000 139.000,000 Due from banks Due to banks 98,000.000 81.000,000 1 542,000,000 1,457,000,000 60,000.000 Borrowings from Federal Reserve Bank_ Loans on secur. to brokers & dealers For own account For account of out-of-town banks_ For account of others Total On demand On time Loans and investments-total Loans-total On securities All other 68,000.000 942,000.000 379,000,000 12,000.000 3,000.000 379,000.000 12,000,000 3,000,000 505.000,000 56,000,000 7,000.000 394,000,000 394,000,000 568,000.000 236,000,000 234,000.000 427,000,000 158,000.000 160,000,000 141,000.000 Chicago. 1 094,000,000 1,088,000,000 1,560,000,000 641,000.000 639.000,000 1,074,000,000 365,000.000 276,000,000 362,000,000 277,000.000 617,000,000 457,000.000 44 Financial Chronicle Jan.4 1933. Dec. 28 1932. Jas. 6 1932. Investments-total U.S. Government securities Other securities Reserve with Federal Reserve Bank_ Cash in vault Net demand deposits Time deposits Government deposits Due from banks Due to banks Borrowings from Federal Reserve Bank 453,000.000 449.000,000 486,000,000 255,000,000 198,000,000 253.000,000 196,000.000 275,000.000 211,000,000 _ 305,000,000 20,000,000 296,000,000 20,000,000 147,000,000 19,000,000 925,000,000 326,000,000 15,000,000 915,000,000 1,021,000.000 316,000,000 412,000,000 19,000,000 13,000,000 245,060,000 298,000,000 262,000,000 295,000,000 126,000,000 274,000,000 11,000,000 Jan. 7 1933 elected a member of the London Stock Exchange , being associated with the firm of Duckmaster & Moore. He resigned from the Stock Exchange in 1929 to become a member of the staff of the Bank of England, where he continued until the organization in 1930 of the Bank for International Settlements, of which he was appointed one of the managers. The latter post he filled for two years. Mr. Rodd participat ed in explorations in the Southern Sahara in 1922 and 1927 and was awarded medals by the Royal Geographical Society. Mr. Rodd is a son of Sir Rennel Rodd, who served for many years in the British Diplomatic Corps and was Ambassador to Italy from 1908-1919. Becomes a Member of Morgan& Cie., Paris. Alan Vasey Arragon was born at Chicago and is aged 39. He attended Northwestern University where he got his A.B. in 1914. and his M.A. in 1915. He was an instructor at Iowa State College 1915-1917 . He left the latter post to join the Army,serving with the artillery arm in France. HIS military service lasted from May 1917 until February 1919, and soon after leaving the Army he joined the staff of the First National Bank, Chicago, He became a member of the Morgan & Cie. organization in 1920 and has continued there ever since. Complete Returns of the Member Banks of the Federal Reserve System for the Preceding Week. As explained above, the statements for the New York and Chicago member banks are now given out on Thursda y, Departure for Europe of Gates W. simultaneously with the figures for the Reserve McGarrah, Chairbanks themman of the Bank for International Settlements selves and covering the same week, instead of being held -Ambassador Mellon Also Sails. until the following Monday, before which time the statistics Gates W. McGarrah, Chairman of the Bank for Intercovering the entire body of reporting member banks in 101 national cities cannot be got ready. Settlements, sailed on Jan. 4 with Mrs. McGarrah on the White Star liner Majestic. In the following will be found the comments of the Federal Andrew W.Mellon,United States Ambassador to Great BriReserve Board respecting the returns of the entire body of tain, was also a passenger on the same steamer. Ambassareporting member banks of the Federal Reserve System for dor Mellon arrived in this country for the Christmas holidays the week ended with the close of business on Dec. 28: The Federal Reserve Board's condition statement on Dec. 22. of weekly reporting member banks in leading cities on Dec. 28 shows decreases for the week of in loans and investments and $27.000,000 in Government deposits, and increases of $31,000,000 in net demand deposits, $15,000,000 In time deposits and $35,000,000 in reserve balances with Federal Reserve banks. Loans on securities declined $9,000,000 at reporting member banks in the New York district and $16,000.000 at all reporting member banks. "Ail other" loans declined $30.000,000 in the New York district,$10,000,000 In the Boston district and $55,000,000 at all reporting banks. Holdings of United States Government securities declined $22,000,000 at reporting member banks in the New York district, $7,000,000 in the San Francisco district and $29,000,000 at all reporting banks, and increased $9,000,000 in the St. Louis district. Holdings of other securities increased $23,000,000 in the New York district and $30.000,000 at all reporting banks. Borrowings of weekly reporting member banks from Federal Reserve banks aggregated $67.000.000 on Dec. 28, the principal change for the week being an increase of $4,000,000 at the Federal Reserve Bank of Atlanta. A summary of the principal assets and liabilities of weekly reporting member banks, together with changes during the week and the year ending Dec. 28 1932, follows* Increase (+) or Decrease (-) Since Dec. 28 1932. Dec. 21 1932. Dec. 30 1931. Loans and investments-total_ _ _ 18.804,000,000 -70,000,000 -1,728,000,000 Loans-total 10,297,000,000 -71,000,000 -2,807,000,000 On securities 4,315,000,000 -16,000,000 -1,462,000,000 All other 5,982,000,000 -55,000,000 -1,345,000,000 Investments-total 8,507,000,000 +1,000,000 +1,079,000,000 U.S. Government securities 5,207,000,000 -29,000,0 00 +1,147,000,000 Other securities 3,300,000,000 +30,000,000 -68,000,000 Reserves with F. R. banks 2,049,000,000 +35,000,000 +216,000,000 Cash in vault 233,000,000 -9,000,000 -38,000,000 Net demand deposits 11,758,000,000 +31,000,000 -119,000,000 Time deposits 5,656,000,000 +15,000,000 -242,000,000 Government deposits 399,000,000 -27,000,000 +47,000,000 Due from banks 1,710,000,000 +19,000.000 +717,000,000 Due to banks 3,304,000,000 -5,000,000 +832,000,000 Borrowings from F. R. banks_ __ _ 67,000,000 i-3000,000 --618,000,000 $70,000.000 New Members in J. P. Morgan Firms in London and Paris. It was announced on Dec.31 that Francis Rennel Rodd has resigned from the Bank of England to join Morgan, Grenfell & Co. A cablegram from London to the New York "Times" reporting this said: Mr. Rodd told this correspondent to-night that he had taken a "general partnership" in the business and would be stationed in London. Mr. Rodd has had considerable experience in international affairs and his financial friends consider that both he and the House of Morgan are to be congratulated on the appointment, which is one of the most coveted partnerships in the banking world. Regarding the admission of a new partner in the Paris firm a wireless message from the French city, Dec. 31, to the same paper stated: Announcement was made to-day that Alan Vasey Arragon of J. P. Morgan & Co.'s bank here had been promoted to be a partner in the firm. Mr. Arragon became associated with the Morgan Bret just after the war, in which he served as Captain. For some years he has been acting as Manager of the Paris branch and recently he has been specializi ng in international finance. He will be one of the youngest partners of the bank. The following regarding the careers of Messrs. Rodd and Arragon was made available on Dec. 31 at the offices of J. P. Morgan & Co. in New York: Becomes a Member of Morgan, Grenfell & Co., London. Francis Rennel Rodd is a graduate of Eton and of BaUlol College, Oxford. World the War he served in France in 1914-1915 and Italy In in 1918 and In Libya, Egypt, Sinai, Palestine and Syria in 1917-1918. At the close of the war he entered the British Dipoimatic Service, serving at Rome and Sofia, where he was Charge d'Affaires, and later was on duty at the Foreign Office in London. He resigned from the Diplomatic Service in 1924 and was Production of Gold and Silver in the United States, According to Director of Mint-Increase in Gold Production-Decrease in Silver Production. An increase in gold production and decline in silver in 1932 is shown in the following preliminary estimate issued Jan. 4 by the Director of the Mint: PRODUCTION OF GOLD AND SILVER IN THE UNITED STATES IN 1932. (Arrivals at United States Mints and Assay Offices and at private refineries.) The Bureau of the Mint, with the co-operation of the Bureau of Mines, has issued the following statement of the preliminary estimate of refinery production of gold and silver in the United States during the calendar year 1932: Gold, Silver. Stales. Alaska Alabama Arizona California Colorado Georgia Idaho Michigan Montana Nevada New Mexico North Carolina Oregon Pennsylvania South-Carolina South‘Dakota Tennessee Texas Utah Virginia Washington Wyoming Philippine Islands Puerto Rico Ounces. Value. Ounces. 434,514 29 66,980 566,031 306,668 242 41,327 $8,982,200 600 1,384,600 11,700,900 6,339,400 115,000 854,300 43,407 130,037 23,917 508 20,753 82 58 485,051 189 10 153,557 10 4,242 1,592 228,282 101 897,300 2,688.100 494,400 10,500 429,000 1,700 1,200 10,026,900 3,900 200 3,174,300 200 87,700 32,900 4,719,000 2,100 258,791 6 1,974,946 483,706 1,786,701 28 6,733,760 48,478 2,426,371 1,347,871 1,218,568 9,095 8,983 783 4 127,581 19,426 1,551 7,815,958 17,997 329 146,147 11 Value.* $72,415 2 556,935 136,405 503,850 8 1,898,920 13,671 684,237 380,100 343,636 2,565 2,533 221 1 35,978 5,478 437 2,204,099 5,075 93 41,213 a Totals 2,507,587 851,836,400 24,425,089 86,887,875 " Value at 28.20. per ounce, the average New York price of bar silver. Comparison with 1931 f nal production indicates increase in 1932 o $2,309,200 in gold and decrease in 1932 of 6,506,961 ounces of silver. Comparison year of largest production. 1915, when gold amounted to $101,035,700 with the and silver 74,961,075 ounces, gives reductions respectively of 849,199,300 gold and 50,535,9813 ounces silver. New Monetary World System Urged for Silver-WheatRemonetization, Stabilization Plan Adhering to Gold Proposed by Frank O'Hearn of Standard Stock Exchange of Toronto. A new monetary system for the world, a system in which wheat, silver and gold would be the vital factors, has been presented to financiers in America, Great Britain and other countries, by Frank O'Hearn, former Vice-President of the Standard Stock Exchange of Toronto, according to Associated Press accounts from that city Dec. 10. As given in the New York "Evening Post" these advices said: Preferring it as to panacea, but as a plan intended to aid farmers and silver currency nations. Mr. O'Hearn has drawn up the suggestio n In outline and mailed it to leading economists and money experts. The first aim would be to arrive at a commodity valuation so stabilized that it would be a standard to which all other commodities and services would have a permanent relative valuation. The second would be to elaborate the gold monetary sustem to fulfill efficiently the requirements of modern business and the needs of the people. Two Primary Requisites. This, Mr. O'Hearn believes, calls for two primary requisites: (1) A fixed monetary valuation between wheat and silver. (2) A flexible monetary valuation as between the new silver-whe at standard and gold. Mr. O'Hearn suggests that inasmuch as one ounce of sliver and one bushel of wheat are now approximately at the same price, the future standard of value for all commodities and services be on the bash; of one ounce of silver equalling one bushel of wheat. In carrying out the plan, he would have a new "silver-wheat" coin introduced into the currency of all nations in conjuncti on with their own Volume 136 Financial Chronicle monetary systems. This would be recognized as the world's standard of value for silver and wheat. He declares this coin would have no bearing in value, or otherwise, with any existing currencies. In his outline of the plan he refers to it as the "SW" coin. The minting and establishing of reserves for the "SW" would be accomplished in manner similar to that employed for gold. The fixing of the flexible ratio between the "SW" and gold would be the same as now prevails in the fixing of the values of various national Currencies to the gold standard. Mr. O'Hearn would have a permanent world committee confer continually and this committee "from day to day would set and announce the exchange to gold at which the 'SW' coins throughout the world would be redeemable." Farmers anywhere holding "SW" Wins or credits would have the privilege at any time of exchanging them into their own or any foreign currencies they desired. "In theory and practice," said Mr. O'Hearn,"this comprises the manner and means of at once stabilizing the value of wheat and the remonetization of silver, while at the same time adhering to our present gold standard." The only opposition, he believes, would be by the Chicago and Winnipeg Grain Exchanges, for speculation in wheat would be terminated. Debt Instalments Due First of Year Postponed—Total of $417,566 Involved in Payments of Greece and Austria, According to Treasury Records. In its issue of Dec. 30 the "United States Daily" said that America will collect none of the $417,556 in war-debt payments which were to fall due on Jan. 1, according to oral statements made Dec. 29 at the Treasury Department. The "Daily" added: Both Greece—which was to have paid $130,000—and Austria—which was scheduled to pay $287,556—have invoked provisions in their wardebt funding agreements with the United States which permit them to postpone payment, it was stated. Pisoal-Year Collections. America has collected only 73% of the debt instalments due her thus far this fiscal year, Treasury records show. The latest Greek and Austrian postponements bring the total of instalments delayed under the funding agreements to $9,731,556. Payments aggregating $25,441,431 have been defaulted, and instalments of $98,685,910 have been met. Additional Information furnished follows: Greece, in addition to postponing the Jan. 1 instalment, has defaulted on one payment in this fiscal year and has postponed another. Interest on this first postponed instalment, amounting to $7,000, is due Jan. 1, and, although the new instalment has been postponed, the Greek Government has not officially indicated whether it will meet this small interest charge. Length of Postponement. Because the postponement of the Jan. 1 instalment was the second delay invoked by Greece, and because the first postponement has not been paid meanwhile, this second postponement may be for only two years. The first postponement was for two and a half years. Moreover, no more than two postponements may be automatically invoked under the debt agreement, and Greece, therefore, has exhausted the Postponement possibilities under her agreement until she settles for the delayed instalments. Other nations which have invoked the postponement clauses—Germany, Poland, Estonia, and Latvia—will find themselves in similar positions if they again resort to the clauses. The Austrian postponement is of a different nature. Repayment of the American loan to Austria is, until 1943, conditional upon the consent of the trustees of the international loan to Austria. Until 1943 this loan has a prior lien on the Austrian assets, and trustees of the international lean may prevent the payment of any annuity to America by objecting 80 days prior to the due date. Report That Great Britain Plans to Send War Debt Mission to United States Denied, Associated Press advices from London Jan. 4 stated: Reports in a newspaper to-day that Great Britain planned to send a war debt mission to the United States were soon denied In authoritative quarters. The next developments in the debt situation, it was explained, might be expected after an exchange of views through diplomatic channels that might take weeks. The British view is that the debt negotiations eventually will become a part of the projected world economic conference or will be carried on parallel to that meeting. $650,000,000 Loans Repaid by Great Britain—Funds Obtained in United States and in France in At• tempt to Preserve the Gold Standard. The following is from the New York "Times" of Jan.3: Pr The past year was frequently referred to as a period of "getting out of debt." The outstanding example of this development in the International field was the repayment by Great Britain of funds borrowed in the latter half of 1931 in an attempt to preserve the pound sterling on the gold standard. These borrowings amounted to 8650,00.000, of which $250.000,0000 obtained on Aug. 1 1931. was extended jointly by the Bank of France and the Federal Reserve Banks to the Bank of England. and $400.000.000 was extended by the New York and Paris markets to the British Treasury on Aug. 28 1931. Of the credit to the Bank of England, 40%, or 8100,000,000, was repaid on Nov. 1 1931. The remaining $150,000,000 was wiped out on Feb. 1 last. The private banking credit consisted of 8200.000.000 extended by a group of 110 American banks under the leadership of J. P. Morgan & Co. and a like amount supplied by Paris, $100.000,000 by the sale to the French public of British one-year treasury bills and $100.000,000 In the form of an overdraft on a group of French banks. The American portion was repaid as follows): On March 4. $3150.000.000: on March 29, $30,000.000, and on April 5. $20,000,000. In the case of the last two payments the line of credit was kept open until the expiration date of the original credit, Aug. 27. when it lapsed without renewal. The half of the French credit consisting of an overdraft on Paris banks was wiped out gradually early in the year as funds became available, while the $100.000,000 of British Treasury bills sold to the French public was repaid on falling due in August. The repayment of these credits In so short a time In the face of a declining exchange value for the pound sterling and 45 In the midst of a financial crisis was regarded in banking circles as an extraordinary achievement. Sir Alan Anderson of Orient Line of Great Britain Accuses United States of Injuring Shipping—Says $3,000,000,000 Subsidy in 12 Years Let United States Lines Operate Below Cost—Sees Bar to Debt Payment—Holds Britain Could Pay in Services. A protest against American shipping subsidies was voiced in London on Dec. 20 by Sir Alan Anderson, Chairman of the Orient Line, which operates a fleet of liners between Great Britain and Australia. Advices from London to the New York "Times" reporting this also said: Declaring American taxpayers had spent $3.000.000.000 on subsidies in the past 12 years, Sir Alan told his shareholders, "This figure exceeds by a ,all quarter billion the total payments on war debts to the United States 03 her debtors up to last year." The United States Government,he asserted, "Is dumping shipping services on the World's market below cost and thus refusing to be paid its debts in the form of shipping services, in which the world, especially Britain. can pay." Unless the American restrictions against foreign shipping are withdrawn. he hinted. Britain may be forced to bar American vessels from trading between British Empire ports. We have also been supplied by one of our subscribers abroad with the following extract from the London "Times" of Dec. 21, of Sir Alan's speech, which was delivered at the Dec. 20 meeting of the Orient Steam Navigation Company's stockholders: Dumping of Services. Among the world causes of our distress which need attention is one peculiar to shipping. Every one condemns a country which exports goods far below cost to flood a neighbor's market and to ruin her competitors. It is as bad to dump services as to dump goods, but one nation after another has become obsessed with the desire to fly its flag on merchant ships and by giving enormous subsidies has dumped shipping services on the world market, with the apparent object of ruining shipowners who try to make ends meet. France and Italy feel poor when they cannot pay to us the debt which on their behalf we incurred to United States of America, but they must have felt very rich when they fixed their shipping programmes and voted the subsidies of liners. I will not give you a list of the subsidies paid to the foreign lines which directly compete with us, but as the whole world is being pressed to pay debts to one nation and as in my judgment the world market and the world prices have neon broken more oy the refusal of that creditor nation to receive payment in goods and services than by any other human error, it may interest you to know to what length United States of America go in subsidizing their mercantile marine in dumping shipping services on the world's market below cost and in this way refusing to be paid their debts in the form of shipping services in which the world, and in particular Great Britain, can pay. United States Taxpayers and Shipping Losses. From the official reports of the United States Shipping Board it appears that during five years to June 1928 the United States taxpayer paid in operating losses and in laying up expenses of merchant ships on the average anout E5,000.000 at par in each year; the total loss for the 12 Years from 1920. including the operating loss named above, but excluding interest. has been about £600,000,000 at par. Such immense figures by themselves mean nothing but it may concern you to know that in this one gesture of refusal to accept the services of fareign ships in payment of past debts and current exports, the United States taxpayer has devoted a sum of money which is approximately Ten times the value of goods bought by United States of America from the United Kingdom in 1929, a fairly normal year, or Eight times the cost of the Panama Canal, or Five times the face value of preferred and common stock and funded debt of Bethlehem Steel Works, or Twice the value based on building cost less normal depreciation of the 17.500,000 tons of British merchant ships engaged in foreign trade. or Exceeds by some .£50,000.000 at par the total payments for War debts made to United States of America by all her debtors up to 1st year. It is difficult to exaggerate the injury the United States of America does to world trade and incidentally to herself by devoting such a mass of wealth to rejecting payment by her debtors in the form of shipping services. It almost seems that the more the world in its anxiety to be honest pours its much-needed spending power into United States of America. the more resolutely United States of America applies that wealth to prevent the debtor from repaying or recovering his prosperity, which is as necessary for the prosperity of the firmer and industrialist and investor of United States of America as for anyone. Perhaps the taxpayer of United States of America does not grasp what is happening and he is not enlightened by the shipowner, who naturally speaks as if he was engaged in normal enterprise at his own risk and deserved praise for his courage. Curious Piece of Commercial Enterprise. The Matson Line, for instance, are placing on the run San FranciscoHonolulu-New Zealand-Australia three new vessels whose capital cost and running expense are much greater than the trade will repay, judged by past experience. The competing British line, which cannot dip into the public purse, is unable to offer the public such costly vessels. Moreover. the British line is excluded from the voyage between Honolulu and San Francisco, whereas the Matson Line competes freely between New Zealand and Australia. Listen now to the United States journalist and shipowner on this curious piece of commercial enterprise. First the journalist: "Usually adventures begin when ships sail, but the colorful arrival in the bay of this monarch of tropic travel was the occasion for officials of the Matson Line to announce they had invested $25,000,000 in a gesture of challenge to British Empire trade." And listen to the shipowner: "Gamble Explained.—I know that people have wondered how we could afford to invest $25.000.000 as a gamble in futures when the Sydney-San Francisco trade has been unable to make the run of our three old-timers. Sierra, Ventura, and Sonoma, very profitable. We are going on the Principle that service makes travel and travel makes trade. We are out to complete with the P. & 0. and Orient Line and, with speed, comfort, and perfect efficiency, divert trade to this route." We must give a man credit for knowing just how little his fellow-countrymen know about the way their money is spent, but is is really hard to belie,* that anyone should be surprised at the courage of the Matson Line. If the Matson Line had found $25,000,000 themselves, or even were being • 46 Financial Chronicle charged interest upon it at normal rates, or were in any serious risk of having to pay the eventual loss, we might indeed blame them for "gambling" --shipowners should not gamble—but as a grateful nation is taking the risk we must congratulate these American shipowners on being safe men and not gamblers. "Gesture of Challenge" to Great Britain's Trade. As to the "gesture of challenge" to Great Britain's trade and the intention to compete with the Orient Line we shall not claim "perfect efficiency," nor can we play beggar-my-neighbor against the richest nation on earth; but we shall try to maintain a service on which British citizens can travel with comfort and dispatch at their own cost; and as to maintain that service nothing is more necessary than good men at sea and ashore, keeping their courage and their wits and their manners in these trying times, you will. I am sure, wish to send your compliments and thanks to our captains, officers, and men at sea. In my long voyages this year on Orford and Orama and short trips in several other of your ships I was impressed not only by the discipline and smartness but by the evident wish to please shown by all hands. Sir Arthur Balfour of Great Britain Would Pay Debt to United States by Loan to Be Floated in This Country—Steel Man Suggests a $1,000,000,000 Issue with Creditors' Guarantee. A London cablegram as follows Jan. 1 is from the New York "Times": A final lump sum war debt settlement by means of a long-term was advocated by Sir Arthur Balfour, leader of the British steel industry, in "The Observer" to-day. "My own view," he says, "Is that we shall finally have to offer America to float a loan for $1,000.000,000 in the States at say 3%% with the right to pay it off within the next 60 years at our option, and that is the maximum we will ever be able to pay. "This form of settlement would not upset exchanges and would have to be final. It is somewhat in proportion to the settlement made with Germany regarding reparations and that settlement, of course, was forced by economic circumstances as the debts settlement will finally have to be." See Dangers to Trade. Warning that the United States must reduce the debts or lose her export trade, Sir Arthur asserts the American people have misunderstood the whole war debt situation and "are choosing to lose their export trade with disastrous results to themselves." "It Is hard for any nation to realize that the settlement of war debts or reparations and the removal of vast sums of money from one country to another—however just the payment may appear—is not finally founded on justice but on what Is economically possible," he continued. He suggests a need for "sane propaganda" to convince the American public it is physically impossible for European nations to pay their debts. Such propaganda, in Sir Arthur's opinion, should also recall the speeches made when the money was lent "and last but not least the fact that we fought the war wo years without America and that in the final result, while they lost 107,000 men killed, the British Empire last 807,000 and the French 1,420.000." Sir Arthur is moderately hopeful of trade recovery, but believes tariffs and other trade restrictions as well as debts still are blocking the way. No creditor nation like Britain or the United States can hope to live under high tariffs, he declares, and there must be a reduction all around. The only method of reduction, in his opinion, is to scrap the most-favorednation clauses and bargain with individual countries. For Britain he suggests the method for bringing down foreign tariff walls is to close the British market to the goods of all countries except those which are willing to open their markets to Britain. Return to Gold in England Distant—Nevertheless, Wild Fluctuation of Sterling in 1932 Greatly Disconcerted Business. The following from London Dec. 27 is from the New York "Times": The British market, including the banking community, is unanimous in believing that England must refuse to return to a gold basis of currency until commodity values shall have been estaollshed on a higher level and other conditions shall have been fulfilled which will positively insure the successful working of the gold standard. This view Is taken notwithstanding the fact that the instability of sterling rates has been one of the greatest obstacles during 1932 to recovery in British trade. Events over which this country itself had little or no control have combined to defeat the efforts of the British Government to secure stability of exchange through the use of the large government fund. Bankers are nevertheless constantly urging that this defect in the market somehow must be met. The government takes a similar attitude, but return to gold is not discussed. Jan. 7 1933 The part of the deficit accounted for by the payment to the United statesis not to be carried forward to the budget for the new fiscal year beginning April 1 1933. Savings Will Meet War Debt. The war debt payment, as explained by Neville Chamberlain. Chancellor of the Exchequer in the House of Commons during the debt debate, is met by savings in the sinking fund and by savings on lower interest rates on treasury bills. These savings are chiefly due to the conversion last August of the £2,000,000.000 Internal War Loan from 5% to 3%% interest. Such savings ordinarily apply to any part of the national debt, but under the circumstances they must square accounts with reference topayment to the United States, for which no provision has been made in this year's budget. Neither did this year's budget in the beginning make adequate allowance for increased unemployment and the resulting exchequer expenditures on insurance and other relief for workless men and women. The necessarysupplementary estimates for this account and some minor items aggregated £21,000,000. According to government experts the budgetary situation is sound in anticipation of the Income tax receipts now due. The collections will be rigidly exacted and there is no indication of any reduction of the income tax rate in 1933 from the present basic rate of five shillings for every pound of income. As expected. the chief increase in revenue is in customs receipts, due tothe new tariff which went into effect last March. For the nine months ending to-day these import duties have yielded £127,172,000, an increase of £26,399.000 over last year. Other Increases in Revenue. Estate duties have increased by about £8.000,000 to £56,780,000. Excise duties, totaling £94,200,000, show an increase of £3,300,000. Stamp duties are up about £1,000,000 to £11,010,000. They are the only items of revenue showing gains over the corresponding nine months in 1931. Income tax receipts so far total E68,581,000, showing a decrease of £7,891.000 and surtaxes already collected are only E15,170,000 or £6,430,000 less than what was collected at this time last year. Thanks to the customs receipts and other increased items the total revenue for the nine months of £404,331.904 is greater by £9.790.323 than the total at the end of 1931. On the expenditure side of the account, charges for interest and management of the national debt total /233,687,242 or £18,662,922 less than last year. There has aiso been a decrease in expenditure for the nine monthson the Army, Navy and Air Service. For the period ending to night they have cost £75.910,000 or less than last year's total by /5,250,000. Total expenditures, exclusive of the Dec. 15 payment to the United States. have been £580,043,649. The total floating debt outstanding to-day is £977,975,000, which isgreater by £250.495,000 than it was a year ago and an increase of a66,020.000 over the total outstanding at the end of the last fiscal year, March 31 1932. Canadian Government, Provincial and Municipal Financing for Year. Canadian Government, provincial and municipal financing for the year ended Dec. 31 1932 aggregated $461,442,456 of which $365,329,123 or 79% was sold in Canada, 2,535,000 or approximately 18% was sold in the United States and $13,578,333 or 3% in England, according to the annual compilation of Wood, Gundy & Co., Ltd., made public Jan. 3. They state that, of this total financing in 1932 $226,250,000, was for the Canadian government; $135,571,333 for the Provinces; $32,563,670 for the Ontario municipalities; $63,007,687 for Quebec and Maritime municipalities and $4,049,766 for Western municipalities. They further report: This compares with financing during the year 1931 of $561,627,604, exclusive of a conversion loan of $639,816,500. and $453,810,718 in 1930. during which year $241,744,100 or 53% was sold in this country, $205,196,618 or 45% in Canada and $6,870,000 or 1.5% in England. This reflects the extent to which the financial requirements of the Canadian government,its provinces and municipalities have been taken care of during this year, through the sale of internal issues in contrast with the large amounts borrowed in this country in previous years. The complete figures for the years 1928 to 1932 Inclusive follow: DOMINION OF CANADA GOVERNMENT AND MUNICIPAL FINANCING For Year Ended Dec. 31.— Dom. Govt. Dlr. dr Gtd Prov. Dlr. dr Gtd. Ontario Municipal Quebec dr Mar. Municipal West% Municipal 1928. 1929. 1930. 1931. 1932. $ $ $ s $ 35.000,000 138,500,000 218,600,000 87.400.000 120.590,152 120,483.000 10.962,146 30,908,224 53,88S,563 x981,014.700 226,250.000 130.416,205 135,571,333 35,273,836 32,563.670 4.891.450 41,071,770 31,507,354 14,204,828 10,474,176 29,336,801 43,326,000 63.007,687 11,413,363 4,049,766 British Treasury Aided by Customs—Deficit for Three Quarters of Fiscal Year Less Than £1,000,000 Above 1931—Income Tax Not Yet In—Total Income of £404,331,904 Is Greater by £9,790,323 Than Total Last Year. The British Treasury report, issued on Dec. 31, lists Government revenue for the nine months of 1932, ending to-day, at £404,331,904, with expenditures for the same period of £608,999,998. A cablegram from London to the New York "Times" (Dec. 31) notes that the pound is worth about $3.30, and goes on to say: Receipt of Funds to Pay Jan. 1 Coupons on City of Saarbruecken Bonds. Ames, Emerich & Co. announce receipt of funds to pay in, full cdupons which mature Jan. 1 1933 on the City of Saarbruecken 6% sinking fund gold bonds due Jan. 1 1953. The resulting deficit for the first three-quarters of the fiscal year of £204,668,094 exceeds the deficit for the corresponding period of last year by less than £1.000,000. The estimated total receipts for the full Treasury year, which expires at the end of next March, are E766,800,000, so to make up that sum the Exchequer must collect £362,468,096 in the next 90 days. The chief dependence for achieving that Is on the income tax and surtax, threequarters of which is due to-morrow from all British citizens on the income tax rolls. Most of the amount will be paid in the next few weeks. So a deficit is usual on the last day of the calendar year. Included In the total of expenditures for the nine months ending to-day is £28,956,349 paid to the United States Dec. 15 on the war debt account. Bonds of Rumania Monopolies Institute Drawn for Redemption. The Chase National Bank of the City of New York, City Bank Farmers Trust Co. and Dillon, Read & Co., as American fiscal agents, are notifying holders of Kingdom of Rumania Monopolies Institute 7% guaranteed external, sinking fund gold bonds, stabilization and development loan of 1929, due Feb. 1 1959, that $545,700 principal amount of Total 152,458.424 341.544,322 453.810,718 x1,201,444,104 461.442,456 Sold in Canada... 68,448,924 148,622,124 205,196,618 445,556,604 365,329.123 Sold In U. S. A.— 66,359,500 175.963,198 241,744,100 113,854,000 82,535.000 Sold In England 17.680.000 16.959.000 6.870.000 2.217.000 la NM 'Ann x Includes $639,816,500 conversion loan Volume 136 Financial Chronicle the bonds have been drawn by lot for redemption on Feb 1 1933, at par. Payment will be made upon presentation and surrender of the drawn bonds, with subsequent coupons attached, either at the corporate trust department of the Chase National Bank of the City of New York, City Bank Farmers Trust Co. or Dillon, Read & Co., on Feb. 1 1933, after which date interest on the drawn bonds will cease. Jan. 15 for City Bank of New York. Premier Tsaldaris will leave Paris and London to negotiate with bondholders. Rumanian National Bank Grants 65% of Applications for Foreign Exchange. Only 65% of the applications for foreign exchange requested by commercial and industrial firms from the Rumanian National Bank during the first five months of exchange restrictions were granted by that institution, it is made known in a report to the Commerce Department from Assistant Trade Commissioner K. B. Hill, Bucharest. The Department on Dec. 27 also had the following to say: Including the amounts of exchange granted to state institutions the was number of applications granted increased to 81% of the requests, it stated. The total amount applied for was 543,430,000 and of this sum $8,130,000 has been either refused or held In suspense. has In certain of those cases which have been approved the exchange not yet been furnished as the National Bank now allows itself 90 days after approval before furnishing the funds. Commercial firms requesting exMange received 62% of the amounts required, industrial firms 64%, agricultural firms 83% and State institutions 100%, it was reported. Bonds of Chinese Republic Drawn for Redemption. Banque Franco-Chinoise pour le Commerce et l'Industrie is notifying holders of 5% gold bonds of 1925 of the Chinese Republic that 41,532 of the bonds have been drawn and are payable on and after Jan. 15, at their face value of $50 each, at the offices of Banca Commerciale Itsliana, agency in New York, 62 William St. Austrian Government Advises Bank for International Settlements That Arrangements Have Been Made to Supply Funds for Payment of January Interest on International Loan of 1930. An announcement made at Basle, Dec. 31, says: The Bank for International Settlements, as trustee of the Austrian Government International Loan. 1930. announces that the Austrian Government has informed it that the Government has made arrangements to supply the necessary funds in the respective foreign currencies for the payment on Jan. 2 1933, of the interest coupons dated Jan. 11933. of the American, British, Dutch, Italian, Swedish and Swiss trenches of the 1930 loan; the interest coupon for the remaining tranche of this loan, namely, the Austrian issue, will be paid at the same time in Austrian currency. Premier Mussolini of Italy Will Curb Industrial Output As a Means of Combating Depression. The regulation of industry, with the curbing of "exuberant branches of industry, without which the crisis cannot be overcome," is being prepared by Premier Mussolini through a special commission of his Ministry of Corporations. We quote from Associated Press accounts from Rome Dec. 30 (to the New York "Times") from which we also quote: The Premier says "this provision is necessary to facilitate the process of gradually scaling down," instead of speeding up, production. The Commission Is working on details of laws which will be effective in the spring. Under a statute already adopted no plant in whatever line of manufacture may be built or enlarged without the Government's consent. This law was presented to the Chamber by the Premier himself in his capacity of Minister of Corporations. "It is well known," the Premier explained when he advocated the measure. "that although a crisis halts new initiative and investments, nevertheless In the midst of the depression there is always some industry which does not voluntarily slow down but actually feeds on the crisis. "Italian industry must certainly require its lively and expansive spirit in new markets as soon as the economic situation permits, utilizing that Inventive spirit which is our greatest wealth. But those irregular industrial expansions that Were dictated rather,by bankers' than manufacturers' standards cannot be permitted, for there have been too many dolorous experiences for the Fascist State to tolerate any more." The "Times" stated: To reduce unemployment during the winter a public works program to cost $130,000,000 was started by Italy early this month. About half of the money will be spent by spring, and the Government expects the work to keep 300.000 men at work, thus reducing the number of unemployed In the country nearly a third. The plan calls for the erection of bridges, public buildings and aqueducts and the construction of roads. The work is distributed over all parts of the country. Under Premier Mussolini's order all Fascist clubs opened spaghetti kitchens for the needy last winter and these are to be continued throughout this cold season. Greece Orders Payment of Interest on Loan of 1928 Through New York Bankers. Associated Press advices from Athens, Greece, Jan. 4 said: The Greek Government to-day ordered payment of 30% of the interest due on the American loan of 1928 through Speyer & Co. and the National 47 Rome, Under date of Dec. 31 the following (Associated Press) was reported from Athens: to-day Washington The Government informed the Greek Minister at American loan that it would pay 30% of the interest due on the $12,167,000 submit to arbitration of 1929, on condition that the United States agree to contends it was. the question as to whether this was a war loan as Greece Argentine Government Pays Interest on Short-term of External Debt Renewal of Unpaid Portion Maturing Issue of $18,000,000. Brown Brothers, Harriman & Co. announced on Jan. 3 that the Argentine Government had paid the interest on its short-term external debt and agreed to payments amounting to $900,000 on account of the principal. At the same time it was also stated: & Co.. The banking group, consisting of Brown Brothers, Harriman Company, Irving Trust Company, Chase National Bank, New York Trust Company, Trust & Bank Guaranty Trust Company and Central Hanover portion for which arranged the note issue, has agreed to extend the unpaid the connine months at a rate of 5%. Upon completion of the provisions of tract, the amount of the issue to be extended will be $17,100,000. With reference to the renewal of the unpaid portion of the notes the New York "Times" of Jan. 4 said in part: The Issue was renewed until Oct. 1 1933, at 5% interest. One condition of the extension is that the Argentine Government shall pay off slightly more than $2,000,000 of the principal monthly beginning on Oct. 15. The original issue of $50,000,000 5% notes, due on Oct. 1 1930. was the offered to the public at par in April 1930, by a syndicate headed by through Chatham Phenix Corporation. At maturity the issue was paid off Brown by headed the flotation of a new issue of like amount by a syndicate Brothers, Harriman & Co. The refunding issue also carried a 5% coupon and matured on Oct. 1 1931. the Subsequent extensions and piecemeal payments on account by on Argentine Government, the largest of which was a $30,000.000 payment beginthe at $20,000.000 to outstanding Oct. 1 1931, brought the amount ning of 1932. l'hen $1,000,000 of the principal was paid off in January 1932, and a llke amount in April 1932, with extension of the balance to yesterday at the rate of 6%. The bankers indicated yesterday that in view of the increasing favorable trade balance in Argentina, they believed the Government would be able to also carry out its payments late in 1933 according to schedule. It was pointed out that, despite financial difficulties of certain Argentine political its of all on promptly subdivisions, the Government had paid the interest obligations, short-term loans as well as bonds. The six long-term dollar bond issues of the Argentine Government do not mature until 1957 to 1962, inclusive, so that payments to be made on principal during the next few years are those of the sinking funds, most of which are calculated to retire all of the bonds by maturity. Inasmuch as Argentine Government bonds are currently selling on the Stock Exchange at less than 50 cents on the dollar the cost of retirement per bond to the Government is greatly lessened. United States Consulate at Rosario (Argentina) Is Closed. Under date of Jan.4 a cablegram from Rosario, Argentina, to the New York "Times",said: The United States Consulate here has been ordered closed and Consul and John Bailey has been assigned to the Consulate-General in Buenos Aires ConsulateVice-Consul Huhn transferred to Montevideo. This leaves the Argentina. in office General the only American consular Republic of Colombia Buying Bonds to Be Credited to Sinking Fund. Hallgarten & Co. and Kidder, Peabody & Co., fiscal agents, announce that the Minister of Finance and Public Credit of the Republic of Colombia, has instructed them to make the following statement on his behalf: Despite the unfavorable economic situation which forced it to suspend the sinking fund payments on its 6% External Loans of 1927 and 1928. Republic of Colombia is endeavoring so far as possible to comply with these now is and obligations. With this end in view the Republic has acquired delivering to Messrs. Hallgarten & Co. and Kidder, Peabody & Co., as fiscal agents, substantial blocks of bonds of these issues to be credited to the sinking funds. Under the provisions of these loans bonds purchased by the Republic at not exceeding par and accrued interest may be tendered for retirement through the sinking fund, and such bonds shall be accepted in lieu of cash in an amount equal to the purchase price plus the amount of the coupon due on the next interest date. A further statement showing the results of such deliveries of bonds will be made when these operations have been concluded. Salvador Payment on Jan. 1—First Resumption on Defaulted Foreign Bonds. The bondholders' protective committee for the Republic of El Salvador external bonds, of which J. Lawrence Gilson is Chairman and Douglas Bradford, Secretary, announced on Dec. 31 that the interest due Jan. 1 1933 on all bonds of "Series A" which are now deposited or may hereafter be deposited with the Manufacturers Trust Co. or the New York Trust Co., depositaries for the committee, would be paid at any time on or after Jan. 1 1933. It is claimed that this is the first instance where payments have been resumed on a defaulted foreign bond, although negotiations are now in progress on other Latin-American situations which are expected to produce results in the near future. An announce7 ment by the committee says: 48 Financial Chronicle Jan. 7 1933 There is also on deposit an amount sufficient to cover the accrued interest due Jan. 11933, on the scrip which it is proposed to issue in exchange for the July 1 1932 coupons with respect to bonds of the series B and series C, when and as an agreement with the Republic has been concluded. This interest, however, cannot be paid until the scrip is issued. The committee is using its best efforts to conclude a definitive temporary agreement with the Republic, and when this is done, holders of bonds of series B and series C will be duly advised and the scrip will be prepared for distribution together with interest thereon accrued to Jan. 1 1933. As explained in the previous letter of Nov. 30 1932, participation in this distribution of scrip, and cash payment of interest, will be limited to depositing bondholders, who accept such plan as may be promulgated as soon as the agreement is concluded. This is the more remarkable when it is realized that one of the important foreign trade countries of Latin America, Chile, has unquestionably suffered more than any other nation on earth, as a result of the depression, with its copper and nitrate exports practically wiped out. It is in part due to the fact that Latin America, contrary to common thought, is the premier foreign-trade area of the world, not in volume, of course, but because it exports more in proportion to its total production than any other area, and in turn imports more of the things that its people use and need than any other group of countries anywhere. As a large producer of raw materials, and increasingly of foodstuffs, Latin America has suffered from low commodity prices, but its relatively simple civilization and the presence of vast areas capable of maintaining its total population with mere food and shelter with little reference to its foreign trade, has made possible rapid adjustments there to the succeeding stages of the depression. Mexico Won't Alter Her Foreign Policy—New Foreign adjustment has been achieved without the piling up of vast loadsThis of Minister, Dr. Puig-Casauranc Declares His Ap- domestic debt, without appalling new taxes and without even any talk of doles. Many of the countries have been able to adjust their economy pointment Does Not Mean Fundamental Change. promptly to lowering prices of their commodities and Argentina, for instance, alone of the great wheat-producing and exporting areas of the Dr. Jose Manuel Puig-Casauranc, Mexico's new Foreign world, has been able to adjust its production costs to be able to break Minister, has issued a statement declaring no fundamental even—even with recent world prices. change in Mexican foreign policy was contemplated. A The single outstanding difficulty in our trade with Latin America (and this is true of export trade from Europe to Latin America as well) has Mexico City cablegram Dec. 31 reports him as saying: been the exchange and debt situation. Before the economic collapse of "A new chief of the Foreign Office under the same Executive, in a 1929-30 Latin America, by means of foreign deans, had been building up, constitutional and definitely Presidential regime such as Mexico's, does with considerable rapidity, a sound modern economy, but the process had not necessarily imply a change in foreign policy unless the President so not been completed when the slump began and the flow of foreign investdetermines in a concrete case. ment was suddenly cut off. The effort to maintain payments of interest "Therefore, my appointment does not mean a fundamental change in and sinking fund on those foreign loans has practically stripped most of Mexico's foreign policy and attitude toward pending international probthe Latin American countries of their gold, in some cases even to the lems. "cushion" of the revolving deposits abroad which back their currencies. "The same feeling of frank international co-operation, the same attiThe result has been both a depreciation in currency values in relation tude of cordial sympathy and constant and sincere respect for the ideals to gold, and a stringency of exchange which has been the outstanding and aims of other countries and the same firm intention to make more feature of their foreign trade relations in 1932. They have been willing solid the practical ties of friendship with all countries particularly our to buy, have had money in local currencies with which to pay, but the neighbors, will mark the action of the Foreign Office. transfer problem has become increasingly difficult. "Favorable presentation abroad of Mexico's possibilities and necessities, In the past few months a definite series of efforts to meet the problem respect for concrete existing international formulas, and the solution of in a constructive way has developed. Previously the exchange restricany problems and conflicts of an international character that may arise tions, moratoriums, &c., had discouraged both local and foreign merchants are the definite purposes of the Foreign Office." and shippers. The step of most significance, and the one which may have a bearing on the exchange situation in all Latin America, was taken by Uruguay last summer, when an issue of five-year 8% bonds in dollars, Bank of Mexico Purchases Gold. pounds, francs and Uruguayan pesos, as selected, were authorized to be Mexico City advices Dec. 31 to the "Wall Street Journal" taken by creditors, at their choice, for credits (including dividends on foreign capital investments) which have been kept in Uruguay on account of Dec. 31 stated: of exchange difficulties. This move toward a definitive solution of one Bank of Mexico, in the past three months, has accumulated 3,484 kilonational exchange problem has been followed in the past few months by grams of gold valued at $2,331,000 which it will place in reserve. Of the co-operative plans in this country by exporters and importers, by studies total 2,278 kilograms came from Mexican mines. The balance represents of economists to increase imports from Latin America (and thus to create gold coinage. The Mexican Government plans to •build up a reserve of new exchange), by constructive plans for possible use of Government approximately $16,000,000. facilities here to this end, and by the banks turning a more and more receptive ear to the problem. It is a point of immense significance that these discussions inevitably turn—no matter where they start—to Mexican Gold Mining. Latin America. From Mexico City the "Wall Street Journal" of Dee. 31 A solution, even in part, of the exchange problem, and a slight rise in reported the following: commodity prices (or even an increase in commodity movements at present levels), are two hopeful prospects of the coming year. When they come Ministry of industry, commerce and labor has been ordered by Prothey will inexorably bring a rapid response in Latin America, visional President General Abelardo L. Rodriguez to declare as part emd a of revival of trade there can safely be counted upon to be one of the Federal mineral reserves, the Santa Clara placer gold fields in Mulege earliest points of revival in the world trade picture, with direct and the municipality, southern district of lower California Territory. Ministry benefits to United States exports. Assuring that this improvement early explains that the action was taken in Government's determination to bring be continuous is the fact that in the period of depression, and behind will about a co-ordinated exploration and exploitation of the gold fields, and the new tariff walla there, has begun a great movement for home claims that rights of companies and individuals who obtained claims in industries and added manufacture, before shipment, of their the region will be respected as will applications for claims there made raw materials. This promises, in its turn, both growing markets for our machinery and sup. prior to declaring fields part of the national mineral reserves. plies, and also an increasing prosperity to the Latin American peoples who want and will buy our other manufactured goods. Financing of Fruit Farmers by National Agricultural The year 1933 also promises to bring important changes in the situation with regard to the defaulted government bonds in various of the Credit Bank in Mexico. countries. A number of bondholders' committees have been formed, The following from Mexico City, is from the "Wall Street for El Salvador, has been able to bring about a workable and one, that settlement of the problem there. The group brought together informally at Journal" of Dec. 31: the Department of State, early in 1932, to be a co-ordinating body for Branch of National Agricultural Credit Bank in Cuernavaca, capital all who are working to bring about a settlement of the foreign bond of Morelos State has agreed to finance fruit farmers of Jojutla district of be looked to under the leadership of Pierre Jay in New situation, may the State toward experimenting with production of melons. Bank will York, both to lead in that needed co-ordination of effort and also perhaps lend each agriculturalist 100 pesos (approximately $33 American) per to offer some answer to the demand for a future supervision of foreign loans that will hectare (2.47 acres) and provide them with technical advisors, maprotect both the borrowing country and the purchaser of bonds. It may chinery, etc. well be that 1933 will also see the real beginning of the investment of American capital in local industries which seems the inevitable route for Annual Summary of Latin-American Trade by Wallace the resumption of our Latin American investment, and perhaps along lines which have already been suggested as practicable Thompson, Editor of "Ingenieria Internacional"— and tempting to our Regards Commerce with United States As Steady- people. • On the whole, the Latin American situation, ing More Effectively than That of Any Other with its limited unfavorable and its many sound reasons for optimism number of Regional Group—Development of Efforts to Meet 1932 closes,factors promises, as as sure a future for that great new region as it has ever Exchange Problem-1933 Promises Important offered, even in the years of its greatest booms. Changes in Situation Respecting Defaulted Government Bonds. Japanese Contract for Oil from Russia—Will Import In his annual summary of Latin American trade, Wallace 300 Tons Annually for Five Years. Thompson, editor of "Ingenieria Internacional," New York, Under date of Dec. 30, a cablegram from Tokio to the says that "out of the still confused statistics that are closNew York "Times" stated: ing the trade year of 1932, one fact is becoming increasingly Masao Inaishi, a representative of the North Sakhalin Oil Co., informed clear, and that is that Latin American commerce, particu- the press on his return from Moscow to-day that he had concluded a contract larly that with the United States, is steadying perhaps more with the Soviet for knportation of 300 tons of oil a year for the next five years. effectively than is that of any other regional group." "This Crude oil, petroleum and benzine are to be shipped from Baku in quanwas apparent even in the figures for 1931," says Mr. Thomp- tities designated by the importer. son, "when Latin American trade fell off on an average of a little more than 5%, in basic values, as contrasted with the Report That South Africa Will Tax Profits of Gold Orient (13%), Oceania (24%), North America (18%), and Standard Speculation. Europe (a little less than 8%)." "This trend," he adds, From Pretoria (South Africa) Jan. 4, Canadian Press will show yet more of an improvement in the figures for advices published in the New York "Times" said: 1932. in which Latin America has successfully adjusted It Is understood that a tax Is to be levied soon upon speculators in the itself (as a whole) to changing conditions und definitely Stock Exchange and mining issues. The official Government organ forecasts the introduction steadied its economic ship." early in the coming legislative session and states it will be of the tax levied upon Mr. Thompson. whose summary was made available Dec. profits made in speculation as a result of the virtual abandonment of the gold standard by the Union of South Africa. The resultant 31, goes on to say: revenue will ha used to aid wage earners and farmers, it is declared South African Pound Declines-Drops from 90 and 91 to 95 and 96 Per £100 English in London. A cablegram as follows from London Jan. 3 is from the New York "Times": The South African pound made a further step toward parity witn sterling to day,the rates being advanced from 90 and 91 to 95 and 96,South African per £100 English. Parity is expected to be reached in about a week. The muddle into which South African exchange business was thrown last week, owing to her failure to take the necessary precautions before abandoning the gold standard, are gradually being cleared up. The Reserve bank is now resuming the assistance which it normally gives to commercial banks, but in London banks are still unable to negotiate South African bills, since they cannot obtain the usual cover against them in Soutn Africa. They are therefore continuing to make sterling advances against export bills. The abandonment of the gold standard by South Africa was noted in our issue of Dee. 31, page 4462. Market Value of Listed Stock on New York Stock Exchange Jan. 1 1933, $22,767,636,718, Compared with $22,259,137,174 Dec. 1 1932-Claasification of Listed Stocks. As of Jan. 11933, there were 1,237 stock issues aggregating 1,311,881,157 shares listed on the New York Stock Exchange, with a total market value of $22,767,636,718. This compares with 1,242 stock issues aggregating 1,312,148,772 shares listed on the Exchange Dec. 1 with a total market value of $22,259,137,174 and with 1,245 stock issues aggregating 1,312,480,819 shares with a total market value of $23,440,661,828 on Nov. 1. In making public the Jan. 1 figures on Jan. 6, the Exchange said: As of Jan. 1 1933, New York Stock Exchange member borrowings on security collateral amounted to $346,804,658. The ratio of security loans to market values of all listed stocks on this date was therefore 1.52%. As of Dec. 1 1932 New York Stock Exchange member borrowings on security collateral amounted to $337,612,558. The ratio of security loans to market values of all listed stocks on that date was therefore 1.52%. In the following table, listed stocks are classified by leading industrial groups, with the aggregate market value and average price for each: January 1 1933. Market Values. Autos and accessories Financial Chemicals Buildings Electrical equipment manufacturing_ _ Foods Rubber and tires Farm machinery Amusements Land and realty Machinery and metals Mining (excluding Ben) Petroleum Paper and publishing Retail merchandising Railroads and equipments Steel, iron and coke Textiles Gas and electric (operating) Gas and electric (holding) Communications (cable, tel.& radio). Miscellaneous utilities Aviation Business and office equipment Shipping services Ship operating and building Miscellaneous business Leather and boots Tobacco Garments U. S. companies operating abroad_ _ Foreign companies (incl. Cuba de Can.) All listed companies 1,072,493,480 740,161,463 1,839,695,851 133,246,393 604,957,911 1,652,742,966 138,723,804 198,992,744 71,157,266 29,093,150 585,067,936 528,477,102 2,262,379,659 100,075,650 1,217,252,897 2,335,608,223 768,132,127 101,872,241 2,320,818,280 1,464,614,905 2,290,302,558 116,850,838 142,024,284 136,354,908 5,840,950 8,492,068 51,110,800 135,596,858 973,204,618 8,396,565 309,202,916 424,695,307 Aver. Price. 9.84 13.59 27.64 8.45 14.80 23.30 13.40 17.72 3.77 5.80 12.26 8.77 12.37 6.24 17.11 20.37 19.59 9.19 33.54 14.93 61.08 11.49 7.96 12.77 2.79 2.52 11.40 19.63 37.44 6.45 9.39 9.49 December 1 1932. Market Values. 1,040,252,538 702,374,658 1,708,948,737 137.509,808 567,035,877 1,589,447,195 140,361,831 204,399,944 80,999,470 33,177,372 570,313,228 589,985,277 2,269,876,327 122,759,546 1,162,388,803 2,306,284,278 832,366,328 104,489,154 2,151,927,046 1,403,959,871 2,270,089,610 115,684,297 118,512,728 131,687,788 5,758,072 9,048,665 49,145,420 141,935,129 968,652,643 8,358,765 335,067,292 386,241,477 Aver. Price. 9.55 12.89 25.67 8.70 13.88 22.40 11.37 18.20 4.24 6.81 11.95 9.85 12.55 7.65 16.34 20.02 21.23 9.42 31.11 14.34 60.54 11.35 6.64 12.61 2.75 2.68 10.96 20.55 37.20 42 9.95 8.63 22,767,636,718 17.35 22 259,137,174 16.96 Outstanding Brokers' Loans on New York Stock Exchange Show Second Consecutive IncreaseGain of $9.192,100 Brings Total Dec. 31 to $346,804,658, as Compared with $337,612,558 Nov. 30. A second consecutive increase was reported in outstanding brokers' loans on the New York Stock Exchange from November to December. The total on Dec. 31 was reported by the Stook Exchange at $346,804,658, which represents a gain of $9,192,100 over the Nov. 30 total of $337,612,558. The Nov. 30 figure was $12,910,449 above the Oct. 31 total of $324,702,199. In the Dec. 31 statement demand loans are shown as $226,452,358,compared with $213,737,258 Nov. 30, while time loans on Dec. 31 are reported as $120,352,300, against $123,875,300 Nov. 30. The Dec. 31 figures were made public as follows by the Exchange on Jan. 4: Total net loans by New York Stock Exchange members on collateral, contracted for and carried in New York as of the close of business Dec. 31 1932, aggregated $346,804,658. The detailed tabulation follows: Demand Loans. Time Loans. Net borrowings on collateral from New York banks or trust companies 3160,047,784 1118,838,800 Net borrowings on collateral from private bankers, brokers, foreign bank agencies or others in the City of New York 66,404,574 1,513,600 49 Financial Chronicle Volume 136 $226,452,358 $120,352,300 Combined total of time and demand loans, 8346,804,658. The scope of the above compilation is exactly the same as in the loan report issued by the Exchange a month ago. The compilation of the Stock Exchange since the issuance of the monthly figures by it, beginning January 1926,follows: 1926Jan. 30 Feb. 27 Mar.31 Apr. 30 May 28 June 30 July 31 Aug. 31 Sept.30 Oct. 31 Nov.30 Dec. 31 1927Jan. 31 Feb. 28 Mar.31 Apr. 30 May 31 June 30 July Aug. 31 Sept.30 Oct. 31 Nov.30 Dec. 31 1928Jan. 31 Feb. 29 Mar.31 Apr. 30 May 31 June 30 July 31 Aug. 31 Sept.30 Oct. 31 Nov.30 Dec 31 1929Jan. 31 Feb. 28 Mar.30 Apr. 30 May 31 June 29 July 31 Aug. 31 Sept.30 Oct. 31 Nov.30 Dec. 31 1930Jan. 31 Feb. 28 Mar.31 Apr. 30 May 29 June 30 July 31 Aug. 30 Sept.30 Oct. 31 Nov.30 Dec. 31 1931Jan. 31 Feb. 28 Mar.31 Apr. 30 May 29 Jane 30 July 31 Aug. 31 Sept.30 Oct. 31 Nov.30 Dec. 31 1932 Jan. 30 Feb. 29 Mar.31 Apr. 30 May 31 Jima 30 July 30 Aug. 31 Sept.so Oct. 31 Nov.30 Dec. 31 Demand Loans. S2,516.960.599 2,494,846,264 2.033,483.760 1.969,869.852 1,987.316.403 2,225,453,833 2,282.976,720 2.363,861.382 2.419,206.724 2.2139.430,450 2,329,536.550 2.541.682.885 Time Loans. 3988.213.565 1.040,744.057 966.612.407 865.848.657 780.084,111 700.844.512 714,782.807 778,286.686 799,730.286 821,746,475 799,625.125 751.178.370 Total Loans. $3,513.175,154 3.536.590.321 3.000.096.167 2.835,718.509 2.767.400.514 2,926.298,345 2,996.759.527 3.142,148.068 3.218.937.010 3.111.176.925 3,129.161.675 3.292.880.253 2,328,340.338 2,475,498,129 2,504,687,674 2,541.305.897 2,673.993.079 2.756.968.593 2,764,511,040 2,745.570.788 3,107.674,325 3,023.238.874 3,134,027.002 3,480.779.821 810.446.000 780.961.250 785.093.500 799.903.950 783.875.950 811,998.250 877.184.250 928,320.545 896.953,245 922.898.500 957,809.300 952.127.500 3.138,786.338 3,256.459.379 3.289,781,174 3,341.209.847 3,457.860.029 3,568,966.843 3.641,695,290 3,673.891,333 3,914.627.570 3.946.137.374 4.091,836.303 4,432,907.321 3.392.873,281 3,294,378.654 3,580.425,172 3,738,937,599 4,070.359,031 3.741,632,505 3.767.694,495 4.093.889,293 4,689,551,974 5,115.727.534 5,614.388,360 5,722,258.724 1.027,479.260 1.028,200.260 1.059.749.000 1.168,845.000 1.203.687.250 1,156.718.982 1.069.653.084 957.548.112 824,087,711 783.993.528 777.255,904 717.481,787 4.420.352.514 4,322.578,914 4,640,174.172 4.907.782.599 5.274.046.281 4.898.351,487 4.837,347.579 5.051.437.405 5.513.639,685 5,879.721.082 6.391,644.264 8,439.740.511 5,982,672,411 5.948,149,410 6.209,998,520 6 203,712,115 6.099.920.475 6.444.459,079 6.870,142.664 7,161,977,972 7.831,991.369 5.238.028.979 3,297.293.032 3.376,420.785 752.491.831 730.396.507 594.458.888 571.218.280 565.217,450 626,762.195 603.651.630 719,641,454 717.392.710 870,795.889 719,305,737 613.089.488 6,735,164.241 6.678.545,917 6.804.457.108 6,774,930,395 6.665.137,925 7.071.221,275 7.173,794,294 7.881.619.426 8.549.383.979 6,108,824.888 4.016.598.769 3.989,510.273 30528,246.115 3.710,563.352 4.052.161.339 4.362.919.341 3.986.873,034 2.980,284,038 3.021.363.910 2.912.612.666 2.830.259.339 1.980.639.892 1.691.494.226 1,519.400,054 456.521.950 457.025.000 604.141.000 700.212,018 780.958.878 747.427.251 668.118.387 686,020.403 651,193.422 589.484.395 470.754.778 374,212.835 3.984.768,065 4.167.588.352 4;858.302.339 5.063.131,359 4.747.831.912 3.727,711,289 3,689.482.297 3.598.633,069 3.481.452,761 2,556.124.087 2,162.249,002 1,893,612.890 81.365.582.515 1,505,251,689 1.629,863,494 1.389.163,124 1,173,508,350 1,102.285,060 1 041,142.201 1.069.280.033 802.153.879 615,515,068 599.919.108 502.329,542 $354,762.803 334,504,369 278.947.000 261.965.000 261.175.300 289,039,862 302.950.553 284,787,325 242.254,000 180.753.700 130,232.800 84,830.271 $1,720,345,318 1,839,756.058 1,908,810.494 1,651.128.124 1.434.693,650 1.391.324.922 1.344.092.754 1,354,067,350 1.044.407.879 796.268.768 730,151,908 587,159,813 452,706.542 482,043,758 496,577,059 341.003,662 246.937.972 189,343,845 189.754.843 283.518.020 289,793,583 201.817,599 213.737.258 228,452,358 59.311.400 42.620.000 36.526.000 38.013.000 53,459.250 54,230.450 51,845,300 68.183.300 110,008,000 122.884.600 123.875.300 120,352,300 512,017,942 524.663.758 533,103,059 379.015,662 300.397.222 243,574,295 241,599.943 331.699.320 379.801,583 324.702.199 337,612,558 346,804,658 F. L. Newburger, President of Philadelphia Stock Exchange, Finds Progress Toward Economic and Financial Rehabilitation-National Welfare in 1933 Dependent on Governmental Action on Important Issues-Sound Currency Must Be Maintained, Budget Balanced and Excessive Taxation Reduced-Settlement of War Debt Problem Also Necessary. Frank L. Newburger, President of the Philadelphia Stock Exchange, and a partner in the banking firm of Newburger, Loeb & Co., in an interview Jan. 2 finds that "progress has been made along the road to economic and financial rehabilitation." "Our currency," he notes, "has been maintained on a sound basis. Governmental expenses, local as well as national, have been curtailed and will be cut further. The wave of bank failures was checked months ago; now more banks are opening than are closing; the banking system remains sound." Mr. Newburger further noted that "governmental agencies, such as the Reconstruction Finance Corporation, have been set up and are rendering effective services. The transportation problem, essentially the railroad problem, is receiving constructive attention; railroad carloadings have improved. Some quickening of business activity has been noted. There is evidence of increasing co- 50 Financial Chronicle operation within various industrial fields. The destitute and the hungry have been and are being helped, through public measures as well as through private generosity." In indicating that "much remains to be done," Mr. Newburger said: Improvement has been seen in these and other lines, but much remains to be done before we finally emerge from the present period. We enter 1933 with a fuller understanding of our problems, and a more impelling necessity of solving them. Further progress will be made all along the line, provided we keep our feet on the ground and drive straight for our objective. In every period of depression, so-called "new" economic theories and "revolutionary" plans are put forward as panaceas which will cure our business and financial ills. Upon close examination, these "new" plans usually turn out to be old-isms and theories in new guise. We have had a plethora of such theories within the past year, but we have set our faces against them. I believe that we will continue to reject unsound proposals. Our national welfare during 1933 will depend largely upon governmental action on all-important issues. Sound currency must be maintained. Our national budget must be truly balanced. A settlement of the war debt problem must be found, so that its disturbing uncertainties may be eliminated. State and local governments must balance their budgets also, to the end that excessive taxation may be reduced. I believe that definite and conclusive solution of these problems will constitute the greatest contribution that government can make toward the restoration of prosperity. These problems are fundamental. Their solution forms the base on which ultimate recovery must be built. If we solve them —and it should be within our power to do so—I believe that we will make further progress during 1933. • Commenting on the fact that "1932 was the third successive year of depression, a year which, in many respects, was the most difficult and challenging within the memory of the present generation of our business and professional leaders," Mr. Newburger added: He who reads knows how difficult it has been, for the repercussions have been felt by every citizen. Moreover, its problems have challenged the attention of every thinking man, for who among us has not been brought face to face with at least some of the problems? As I look back over the year, I am impressed with an outstanding American trait—courage, that same courage which has marked every step in the long, and sometimes painful, development of the nation. I do not forget those weeks when it seemed that panic might gain the upper livid. The fact that the nation was able to rise above the despair which, engulfing other nations, threatened to engulf us, is eloquent proof of the courage of our people. Halsey, Stuart & Co. Wins License Permit Decision— Company Permitted to Operate in Wisconsin Under Bond of $100,000. Advices from Madison, Wis., on Jan. 2 to the New York "Journal of Commerce" stated that Circuit Judge A. C. Hoppman had vacated the recent action of the Wisconsin State Public Service Commission in returning the application of Halsey, Stuart & Co. for a 1933 license. The action took place when Judge Hoppmann restrained the Commission from interfering with the company's operations in •Wisconsin. The dispatch went on to say: Judge Hoppmann stayed the action of the Commission when the company's 1932 license was revoked on Oct. 6 last. The Commission then appealed to the Supreme Court. The rec t decision is the result of the Commission's action when it returned •e company's application for a 1933 license on Dec. 21. The n appealed to Nudge Hoppmann, whose decision now permits compa to operate under a $100.000 bond. the t\ ppositfron by Illinois Bankers' Association to Branch Banking Provisions of Glass Bill. Under date of Dec. 31 the Illinois Bankers' Association, in a communication to the United States Senate, voiced its opposition to the branch banking provisions of the Glass bill. The Association declares that "the matter of determining the advisability of adopting any form of branch banking. should be left to the decision of the people in each State„ and whatever form may be enacted in any commonwealth affecting State banks should then automatically apply to National banks." The communication follows: To the Honorable Senate of the United States. Washington, D. C.: The Illinois Bankers Association, comprising in its membership 90% of all the banks in Illinois, both State and National, desires to record its opposition to Section 19 of 9.4412 relating to the extension of branch banking privileges to National banks. This section. if enacted, will, without regard to local sentiment and to State laws, permit a National banking association with the approval of the Federal Reserve Board to establish branches within the city or at any point within the State in which it is located, or in an adjacent State within have a 50 miles from Its main office. It is required that such banks shall paid-in and unimpaired capital stock of not less than $500,000 as a precedent to establishing a branch outside of the city in which it is situated. Under this section National banks would be given advantages over State banks which would make for the destruction of our dual banking system. Since we have a dual State and National banking system the autonomy of the States should be respected to the extent that National banks competing with State banks should not be given powers prohibited under State laws to State banks. Congress has recognized this autonomy in Section 11-K of the Federal Reserve Act, in which it is provided that trust powers shall not be exercised by National banks where such powers will contravene the State laws. In the opinion of the bankers of Illinois, as expressed through their Association,it should be for the people of each State to decide for themselves Jan. 7 1933 whether they want branch banking or not. They emphatically reiterate their previous declarations that Congress should grant no further branch banking privileges than to give National banks equal rights with other banks in States where branch banking is permitted. They believe the decision as to whether a State shall have branch banking should be left to the State itself and that this should not be Imposed upon it by Federal legislation. They oppose inter-State branch banking. As a further basis for insisting upon parity between State and National banks in respect to branch banking, we cite the advantage that is now being taken by the office of the Comptroller of the Currency in giving approval to the establishment of branches by National banks under authority granted by the so-called McFadden Act in States which, in order to provide facilities in small communities where lack of banking service caused inconvenience, amended their State banking laws to permit temporarily the operation of branch offices in such communities by banks located in the same or adjacent counties. These measures were enacted to take care of the present emergency and are surrounded by many restrictions. However, the Comptroller's office has, because of the provisions of the McFadden Act,seen fit to authorize National banks located in cities in those States, where ample facilities are being provided, to establish branches therein without regard to the purpose and intent of the State law. Under the proposed legislation similar advantages would continue to accrue to National banks. If for any reason it was deemed desirable to grant by State law authority to State banks in Illinois to establish branch offices in only the city or county in which they are located, the enactment of Section 19 as now constituted would defeat the purpose of the State Legislature and the will of the people in the event such an endeavor were made to restrict the system of branch banking to the designated territory. It is admitted that banldng laws should be strengthened, that supervision by both National and State authorities should be more rigid, and that more care should be taken in the granting of charters for new banks. One of the primary causes for the many bank closings experienced during recent years was the existence of too many banks which were chartered and permitted to operate without a prior determination as to the need for the same, nor as to proper qualification of the management. This applies with equal force to the office of the Comptroller of the Currency from which has emanated much of the advocacy of branch banking as to State Banking Departments. It is contended that small banks are weak because they are small and only the large banks should inspire confidence. There are any number of small banks solid and safe to-day. There are banks of the unit type which have withstood every crisis experienced by this country in more than 100 Years. Safety does not lie in size, in numbers, nor in accumulation of assets. A goodly number of large banks wall branches have failed and have contributed to the record of the last few years. The Federal Reserve Bulletin for December 1932 provides some statistical information which is rather significant in the discussion of the number of closed banks and losses to depositors therein from the calendar year of 1921 to the preliminary records including November 1932. An analysis of the figures applying to the depression years will readily show that, while less than 25% in number of the total suspensions were members of the Federal Reserve System, the deposits in these institutions amounted to 45%, or nearly one-half of the total deposits in all banks closed during that period—a demonstration that losses to depositors averaged greater per bank for members of the Federal Reserve System than for non-members. All methods of banking will prove faulty when safe and sound banking is lacking. If supervision means anything, small banks can be as strong as the big ones, while large institutions with branches spell only bigger disasters if mismanaged ai.d not properly supervised. It has been well said that no mere system of banking will prevent failures any more than any particular system would prevent failures in any other line of business. Failures there will be, until both the Comptroller of the Currency and the various State supervising authorities insist that before granting a charter to any person, or any group of persons, undoubted evidence shall be presented that those seeking charters for banks are in character, financial responsibility, and experience, of the kind to keep the bank solvent after it is opened—and until supervision shall be rigid enough to detect unsafe and unsound practices, and, when discovered, shall insist upon immediate correction or the alternative of the closing of the institution before the assets have been dissipated to the detriment of the depositors. To say that branch banking is the alternative to bank failures is pure assumption. Just because this seemingly works out well in other countries is no indication that it will do so in the United States. In asking that we copy the systems of England or Canada, the conclusions of the advocates are reached on slender and insufficient facts. Racial character, traditions. laws, banking relations, methods of doing business—ail are different in the countries referred to. Shall we take a foreign banking system and apply it bodily to this country without in great measure adopting also the general business practices prevailing there? President-Elect Roosevelt in his message as Governor to the New York to Legislature in January of this year, in referring to the subject of banking, said,"We must by law maintain the principle that banks are a definite benefit to the individual community. That is why a concentration of all banking control in one spot or in a few hands is contrary to a sound public policy. We want strong and stable banks, and at the same time each community must be enabled to keep control of its own money within its own borders." We reiterate that the matter of determining the advisability of adopting any form of branch banking should be left to the de.ision of the people In each State, and whatever form may be enacted in any commonwealth affecting State banks should then automatically apply to National banks. May we, therefore, respectfully ask that the legislation proposed in Section 19 of 8.4412 be amended so that no further branch banking privileges are granted than to give National banks equal rights with other banks in States where branch banking Is permitted. We solicit your support of this principle. ILLINOIS BANKERS ASSOCIATION PAUL E. ZIMMERMANN, President. R. 0. Byerrum of University State Bank of Chicago Holds Weakest Links in Our Banking System Proved to Be Branch Banks—Says Passage of Glass Bill Means Elimination of State and Unit Banks. In a letter to Senator Lewis bearing on the Glass banking bill, R. 0. Byerrum, Vice-President of the University State Bank of Chicago, declares that the passage of the bill, containing the branch banking feature, "means the ultimate elimination of State and unit banks," and " . . . the Volume 136 Financial Chronicle abject surrender to centralized control of the Nation's finances." According to Mr. Byerrum, "the weakest links in our banking system proved to be the 'branch banks,' and they went down comparatively early in the depression." "We fully realize," says Mr. Byerrum, "that our barking system needs strengthening, but it should be strengthened on the broad basis on which it now stands, not the narrow basis of branch banking." Mr. Byerrum's letter follows: Dec. 30 1932. Honorable James Hamilton Lewis, United States Senator, Washington, D. C. My dear Senator: On or about Jan. 1933 the Glass Bill will be presented for your consideration and it is hoped that you will carefully weigh every sentence of this bill before passing upon it. The passage of the bill as it now stands, containing the branch bank feature, means the ultimate elimination of State and unit banks, it means the destruction of individual initiative and development, which is the thing that every American cherishes, it means the abject surrender to centralized control of the Nation's finances which of course means ultimately the centralized control of industry and business, and it also means an unprecedented invasion of State's rights. You may well wonder why these statements are made. The prosperity of these United States is due to the initiative of the individual operating in competition with his fellowmen, but of recent years we have seen the tendency toward centralization of industry, power and wealth develop to the point where it is becoming alarming. The promoters of the branch banking idea have been, in a most insidious way,spreading their propaganda and taking advantage of the present upset economic conditions to further their cause, pointing innocently to Canada, saying they have no failures there. In the first place. Canada is in no way comparable with the United States, except that its natural resources are approximately the same as ours, but they are wholly undeveloped. The national wealth of Canada is about 25 billion dollars, the wealth of the United States over 300 billion, the annual income of Canada about 6 billion as against 82 billion in the United States, Canada's population 10 million and the United States 122 million. In Canada we have an undeveloped country, due without doubt, to the banking system. The portfolios of the Canadian banks indicate that the major portion of their funds are invested in government securities or in securities of industries controlled by the government, leaving very little to loan to the individual and none for real estate loans. The citizens of Canada do not use banks to any extent, therefore runs on banks are not common and after all, the real way to compare systems is to put them to the same test: is there anyone who really believes that the Canadian branch banking system could have stood the test to which our 19,000 banks have been subjected, and which are paying 100 cents on the dollar when a dollar has now the purchasing power of $1.30, whereas the Canadian dollar is worth about 90 cents and the English pound $3.30 when a year ago it was worth $4.86. Is there safety in branch banking? Witness the closing of the branch banking systems in the United States when they were put to the test. The most disastrous failures we had were branch, group and chain failures— such as the following* Bank of United States, New York 59 branches Federal National, Boston 8 branches Banco Kentucky Group 7 branches A. B. Banks—American Chain, Ark 27 branches Manley Chain, Georgia 87 branches Bain Banks, Chicago 12 branches Bankers Trust Co., Pa. 20 branches U. S. National, Los Angeles 8 branches Security Home Trust, Toledo 10 branches Peoples State Bank, South Carolina 44 brandies Arizona State Bank 5 branches Foreman National Group, Chicago 6 branches To this rather impressive group, with deposits running into hundreds of miiilons of dollars, of branch and chain bank collapses, which were due to many of the same abuses that weaken unit banks, we could name important branch, group, and chain banking systems in Detroit, Boston, San Francisco, and other cities which got into trouble and merged or were supported by other banks or United States credit until the crisis was past. The weakest links in our banking system proved to be the "Branch Banks," and they went down comparatively early in the depression; it was their failures that caused public confidence to be shaken so badly that runs were precipitated on and closed many well-managed small independent banks. The independent banker points to Australia where the Bank of New South Wales, with $425,000,000.00 deposits operating 192 branches and 842 offices closed, virtually wrecking that entire country for 50 years to come, also he calls attention to the fact that Italy had four huge branch banking systems at the close of the World War, to-day there ate two left and Mussolini had to form a finance corporation similar to our Reconstruction Finance Corporation to save them. The German Government during the troublous days of 1931 had to take over and reorganize all the ••D" branch banking systems that collapsed, its two independent banks, The Reichskredit Gesellschaft and the Handelsgesellschaft, weathered the storm and emerged as sound as ever. paying 100 cents on the dollar. In Sweden and Norway, when Ivar Krueger committed suicide. the Government had to come to the rescue of all the branch banking systems to save them. Everybody is familiar with what happened in England in 1931. The Britishers started running the banks, first one of the big five was reported in trouble, then another, finally they came over and borrowed $260,000,000 on their best securities from the Federal Reserve Bank of New York. to try to stem the tide, then to keep them from utter collapse the Government goes off the gold standard and pays its depositors in depreciated currency which means a 30% loss, not only to every depositor but to every man and woman who owns a pound. Witness, if you please, the fact that less than 4% of total deposits in the banks of the United States are lost to its depositors. These huge branch banking systems have proven, in times of stress to be absolutely inadjustable. and as a result entire nations espousing branch banking systems are on the verge of collapse. The backbone of our country Is the small. Independent business and banking institution. The charge is made that the small unit bank has been inefficiently managed and that their business should be taken from them and given to a few men in the larger centers who are much more capable to handle the affairs of the country. The independent banker immediately counters with the query—why did they, if they are so efficient, underwrite about 4 billion dollars of foreign and other worthless securities that they sold to the public and to the small banks as the proper investment for a secondary reserve. all Of which are now in default? Why did they support the Instill deal, 51 which, according to the papers, will cause more loss to the public than all the closed banks in the United States put together? Why did they promote the Kreuger & Toll and International Match deal which will cause more loss to the public than all the closed banks in the State of Illinois put together? Likewise the loss occasioned by the unloading by their institutions of the South America securities with appalling losses. Is it any wonder why we are now very skeptical about what they tell us? We fully realize that our banking system needs strengthening, but it should be strengthened on the broad basis on which it now stands, not the narrow basis of branch banking. Banking systems are not made safe by form—whether they be branch or unit banks. They are safe only in proportion to the relations between the demands for cash which will be made upon them and the degree to which the banks cant' quidate loans and investments to meet those demands. The independent bank is the last outpost of independence to which the American public can tie; therefore, it is hoped that you will diligently, vigorously and with real American patriotism use your best efforts to help strengthen our American banking systems instead of aping the systems of the foreign countries that have so abjectly failed and who are now asking the United States to save them from financial chaos. Sincerely yours, R. 0. BYERRUM, vice-President. Study of Availability of Bank Credit by National Industrial Conference Board—Defect Seen in American Banking System Because of Absence of Specialized Institution to Supply Credit Needs of Smaller Concerns. The National Industrial Conference Board announced on Jan. 1, the publication of a comprehensive study of the availability of bank credit. The study was made by the research staff of the Conference Board at the invitation of members of the Banking and Industrial Committee of the New York Federal Reserve District, and has been in progress since early in the summer. Except so far as facts drawn from general sources are used as aids in interpretation, the treatment of the subject rests entirely on an analysis of the confidential replies of about 3,500 concerns, chiefly manufacturing establishments, to a questionnaire as to their recent bank credit experiences sent out by the Conference Board. According to the Board, the study answers the question whether legitimate demands for credit on the part of industry and business have been denied by presenting the facts as revealed by the questionnaire, in conjunction with a review of the events and causes leading up to the near-collapse of the American banking system in the winter of 1931-32. "Viewed from the standpoint of banking and financial statistics," states the report, "it is patent that the course of the present depression has been made deeper by the failure of the banking system at large to extend adequate credit accommodation to industry and trade as a whole." The Board says: The explanation of this failure is to be found mainly in the significant changes in the role of banks in financing production and exchange in the seven-year period preceding economic recession, during which bank credit came more and more to be made available to business indirectly through security, fixed assets, and consumer loans, rather than direct commercial loans. It is also to be found in the structure of the banking system, with Its thousands of independently operating banks, variously organized under National or State charters, with materially differing standards of bank practice, but all interdependent in the end. The effect of these conditions was to impart to a large section of busineisi Independence from banks as debtors and to make banking stability hinge more largely on the stability of property and security values. When these values became unstable, banks as going institutions were rendered vulnerable to the caprices of public confidence. Efforts ny banks to improve their positions by readjusting their assets, when banking failures became numerous and public confidence wavered, led first to the restriction of credit advanced directly to business and later of credit advanced indirectly through their own investments, loans on securities, loans on real estate and loans to consumers. Credit restriction led to a further loss of confidence and set in motion a vicious sequence of financial catastrophe. This assembling and analysis of factual material, hitherto unavallaole. naturally leads to an inquiry as to the most effective steps to take in a reorganization of the American banking system looking to the prevention of similar financial collapses in the future. The report, in a chapter on the problem of bank credit reconstruction, states that the re-establishment of credit contacts between banks and their business customers would seem to be the most critical issue in the restoration of conditions under which bank credit may again be made readily accessible to industry and trade. In view of the fact that the majority of the complaints of bank credit difficulties come from the smaller concerns, the Conference Board states that the question may well be raised whether special measures should not be taken to assist small concerns in solving their working capital problems, which involve the extension of seasonal credits and credits of intermediate terms or terms longer than those permitted by the requirements of sound.commercial banking practice. The Board adds: Since banks no longer look with favor on such loans, according to indications noted in the study, and since in strict banking theory they should not widely extend such loans, is there not a real defect in the American banking system because of the absence of specialized banking Institutions dealing with this sort of credit, with resources for lending acquired from deposits on a savings or time basis? Should not such institutions be created in response to the exigencies of the present emergency by banking and industrial enterprise? If legislative authorization is needed, should not the attention of the Congress and the State legislatures be directed to this need? If no other method of organization seems feasible, should not the 52 Financial Chronicle Federal Government establish an intermediate-term-credit system for Industry and commerce as it has for agriculture? The study points out in conclusion that the complex and interrelated problems affecting the American banking system, on which divergent opinions are held by bankers and financial experts, are none the less significant to business because of their complexity. It is incumbent on industry and trade, says the Board, to co-operate fully in the whole problem of bank-credit reconstruction, both the immediate and the long-run problem, in order that the entire financial structure of business may be properly balanced. Bank Moratorium in Cities of State of Washington Ruled to Be Illegal—Mayors in State Declared Without Power to Order Business Suspension. Mayors of cities in the State of Washington have no legal right to declare a moratorium on banks, Assistant AttorneyGeneral Lester T. Parker has advised the Supervisor of Banking, C. S. Moody. This is learnt from an Oylmpia, Wash., dispatch, Jan. 3, to the "United States Daily," from which the following is also taken: "A moratorium can only be mfective through mutual agreement between all concerned," Mr. Moody said in commenting on the opinion of Mr. Parker. "The effect of a moratorium would be to give a bank a breathing spell during which to attempt a reorganization through co-operation of depositors. We have adopted a policy of putting a representative of the Banking Department in charge of the bank to preserve assets and to assist In reorganization. We are also demanding the right to select the bank's future management." The opinion of the Assistant Attorney-General follows in full text: Dear Sir: We have your letter of Dec. 5, which reads as follows: "We enclose for your information a proclamation by the Mayor of a city In this State, in which he sets out the facts that business conditions have become so depressed and the ability of the citizens of the city to discharge their obligations have become so impaired that it is extremely difficult for the business and financial institutions of the city to conduct their affairs In the usual and customary manner and to discharge their current obligations; and that, therefore, for the best interests of everyone residing in the ity, a moratorium is declared for 90 days, during which period of time maturities of all private obligations shall be extended until the termination of the 90-day period. "We have been informed that checks drawn by customers of banks in such city that have not been presented for payment will be refused payment and that any remittance letters containing checks cleared through outlying banks will be returned unpaid. "First, in your own opinion, has the Mayor of a city or town in the State of Washington, in his official capacity, the power to declare such holiday and suspend business as indicated in the enclosed proclamation, which, in this case, apparently supersedes the operation of the law pertaining to the supervision of State banks? "Second, is the refusal by the bank in such city of payment of outstanding checks drawn upon it by its customers or the return of such checks to clearing banks that presented them by mail, unpaid, an act of Insolvency? "Third, in suoh cases, what is the legal position of the Supervisor of Banking, and what action should he take?" As we advised you, we are of the opinion that a Mayor of a city in the State of Washington has no authority to declare a legal holiday have the effect of suspending the transactions of private business.that can There Is no statute giving the Mayor any authority in this State and, in the absence of statute, the law is well settled that a Mayor has no such authority. 29 C. J. 763. As we explained, the only way such a holiday, declared by the proclamation of the Mayor, can be effective is by the mutual consent of all parties concerned. Legal Position. In answering your second and third questions, you are advised that, in our opinion, your legal position is exactly the same as it always has been. If any bank has refused payment of outstanding checks and the holders of these checks are demanding payment, the banks will have to pay. If they do not, then you should proceed as in any other case of a State bank refusing to pay its obligations in the regular course business. of We do not mean by this, however, that you would be justified in closing a bank that has failed to pay checks simply because of the fact that the Mayor of the city in which the bank is located has declared a holiday. If the bank is in a financial position to pay its obligations , then It should be permitted to reopen and continue business in the regular course. In other words, a bank that has acted in good faith on the Mayor's proclamation has not, in our opinion, committed an act of insolvency in not paying checks during the period declared a holiday by such proclamation. Business Men of Tenino, Wash., Buy Closed Bank With Wooden Money—Make a Deal With Official to Use Deposits Scrip. From Tenino, Wash., Dec. 29, the New York "Times" reported the following: Wooden money is the basis of an effort by the local Chamber of Commerce to restore a bank to Tenino. The Chamber has made a deal with the State Supervisor of Banking to buy the building and equipment of the defunct Citizens' Bank for $3,500. Funds to purchase the building have been obtained by the sale of bank scrip printed on wood to souvenir hunters and coin collectors. A year ago the Chamber embarked on the experimen t of issuing scrip backed by assignments of deposits. The depositors assigned 25% of their money in the closed bank for an equal amount of scrip, thus obtaining the use of the hank's frozen assets several months in advance of dividends and providing the community with a new circulating medium. The scrip gained wide publicity when it was printed on slice-wood that was being introduced for printing purposes. News services, news reels and magazines carried the story of the town that was taking wooden actually money, and it even got into the Congressional Record when a demand was made to take the wooden money out of circulation. The scrip was to be redeemed before Jan. 1 1933, but a large part remains in circulation and the purchase of the bank has been planned to take care of this if it is ever offered for redemption. Ian. 7 1933 Recommendations for Changes in Federal Banking Laws by Committee of U. S. Chamber of Commerce—Report Proposes • Federal Reserve Banks Curb Actions by Memebrs Imperilling Solvency— Branch Systems Urged—Proposal for State-Wide Chains by National Institutions—Investment Affiliates Upheld with Restrictions—Opposition to Glass Banking Bill. Recommendations for changes in the laws regulating Federal Reserve member banks were submitted on Dec. 10 to a referendum vote of the organizations comprising the Chamber of Commerce of the United States. Directors of the Chamber ordered the vote taken on proposals submitted by its Banking Committee under Chairmanship of Harry A. Wheeler of Chicago, said Associated Press accounts from Washington (Dec. 10), which noted: The Committee's report opposed legislation to guarantee bank deposits and, in opposition to the Glass banking reform bill, recommended that, under supervision Reserve member banks be permitted to maintain affiliate corporations to deal in securities. Referenda on this and related questions was in addition to the one announced earlier to-day, dealing exclusively with Federal legislation on branch and group banking. The Committee recommended on that topic that regulation of group banking be undertaken and that National banks of prescribed size be authorized to operate intra-State branches. In the later referendum were submitted the convictions of the Banking Committee that the Glass-Steagall Act provision for issuance of Federal Reserve notes against 40% gold and the balance in Federal securities should be continued; that the emergency power given Reserve banks for direct loans to business enterprises should be repealed; and that legislation should be enacted requiring early retirement of National bank currency issued against Government bonds. It was also advocated that a special agency of the Government be set up with capital supplied by the Government, Reserve and member banks, to liquidate closed member banks and make possible early dividends to their depositors. In noting that the proposals of the Committee included a recommendation that Federal Reserve banks receive "explicit grant of authority," to deny the discount privilege to member institutions which endanger their solvency or contribute to unsound credit conditions by their lending operations, the New York "Times" account from Washington, Dec. 10, also said in part: Supplementing this suggestion was a proposal that legislation be enacted giving "a carefully restricted grant of power" to Federal banking authorities to remove for cause an officer or director of a member bank found responsible, after hearings, for continued unsafe and unsound banking practice. Members also were called upon to express themselves on a proposal to permit National banks, unrestricted by State laws, to establish State-wide branches and to provide for Federal regulation of group banging systems. The proposal would exclude from the latter all except National and State member banks and all eligible components would be required to come within the Federal Reserve System. Better Protection Demanded. In a discussion of the general banking situation the Committee declared that "the regrettable record of the past 10 years of the suspension of 9,553 banks in the United States, 4,832 of these suspensions having occurred since the beginning of the acute depression, clearly indicates the persistence of the need of providing better protection for depositors' funds." "Strong depositories are an imperative need," the report declared. Many of the proposals made in the report are diametrically opposed to legislation now pending in Congress. On the question of investment affiliates of member banks, for instance, the Committee recommended that their maintenance should be permitted on condition that they are prohibited "from offering to the public in its own name stock of any affiliated institution," and providedshares of its stock or the that "precise limitations" are placed on the amount and character of loans of credit advances made by the member bank to its affiliate. Investment affiliatees, under the Glass banking bill scene to come before the Senate, would not be permitted to be maintained by any member bank after three years from the date of enactment of the legislation. Discusses Demoralized Credits. In proposing that each Federal Reserve bank be empowered to deny the privilege of discount to member institutions for unsound lending operations, the Committee said it recognized that demoralized credit conditions were not always due to the improper use of credit by member banks. It added, however, that "experience has shown that Reserve officials, through their control of open market or rediscount activities, may be largely, if not mainly, responsible for an unwieldy or unnecessary volume of credit." In recommending the establishment of branch banking on a State-wide basis, the Committee said that hardship had resulted in some communities because of the partial or complete breakdown of banking facilities, and that "in a regrettable number of cases, in the absence of branch banking, Weak National and State banks continue because no available means offer to affiliate them with strong institutions." Minority Report. Felix M. McWhirter, of Indianapolis, in a minority report, opposed the branch banking proposal as a "flagrant violation of State rights in the financial field by Federal political powers." Committee's Recommendations. In respect to general banking problems the Committee makes these recommendations: The Reserve banks should be given explicit grant of authority to deny for stated periods the privilege of discount to a member bank upon finding that its lending operations endanger its solvency or contribute to unsound credit conditions, provided it has been given suitable warning, sufficient opportunity to correct objectionable practices and right of appeal to the Federal Reserve Board. Under regulations of Federal banking authorities , member banks of Reserve System should be permitted corporate the affiliation with non-membe banks. r Volume 136 Financial Chronicle Subject to the regulation of Federal banking authorities, a member bank Of the Reserve System should be permitted to maintain corporate affiliation with a company organized to transact the business of originating, buying and selling conservative investment securities. Public regulation of a security affiliate of a member bank should prohibit such affiliate from offering to the public in its own name shares of its stock or the stock of any affiliated institution and should provide precise limitations upon the amount and character of any loans or credit advances made by the member bank to such affiliate. The right of National banks and State member banks to conduct transactions in conservative investment securities on their own account and for the account of others should be maintained. The regulation or prohibition of security loans in the financial centers for the account of others than banks should be left to voluntary action rather than be attempted by legislation. Development of the agencies of the Reserve System for the conduct of Its open-market operations should be left to administrative determination rather than be prescribed by statute. Membership of Reserve Boards. Treasury representation on the Federal Reserve Board should be eliminated. At least two members of the Federal Reserve Board should be possessed of proved banking experience. A carefully restricted grant of power should be given to Federal banking authorities to remove for cause an officer or director of a member bank found responsible, after suitable hearings, for continued unsafe or unsound banking practices. A special agency, with appropriate subscriptions to its capital fund by the Federal Government, Reserve banks and member banks, should be established to assist in the speedy liquidation of suspended member banks of the Federal Reserve System. National banks hereafter organized, and State banks hereafter admitted to membership in the Federal Reserve System, should be required to have capital of not less than $100,000, except that subject to the approval of Federal banking authorities, such a bank should be permitted to have a capital of not less than $50,000 if located in a place with a population not exceeding 6,000 inhabitants. There should be no legislation providing for the guarantee of bank deposits. The precise adaptation of the volume of reserve credit in all its forms, including note issues, to the requirements of trade should be regarded as a problem of administrative instead of legislative control. No limiting policy such as one of maintenance of price stability should be imposed by legislation as a definite duty upon the Reserve Board and the Reserve banks. Emergency Legislation. The Committee then takes up emergency legislation, concerning which it makes these recommendations: In the case of financial institutions, at least, there should be no publication of the names of borrowers from the Reconstruction Finance Corporatio n and the amounts of their loans. The provision of the Glass-Steagall Act, permitting until March 3 1933 the Reserve banks to issue Federal Reserve notes with a minimum cover of 40% in gold and gold certificates and the remaining cover represente d by United States Government obligations, should be extended until March 3 1934. The emergency power granted to the Reserve banks to make direct loans to individuals, partnerships or corporations should be repealed at once. Suggestions on Branch Banking. The more detailed recommendations upon branch banking are as follows: 1. National banks, unlimited by restrictions of State laws, should be permitted by Federal statute to establish State-wide branches, provided that in any State continuing to prohibit State-wide branches of State banks the Federal statute should not become effective for a period of six months after its enactment. 2. Any grant of branch banking powers to National banks should be given also to State member banks of the Reserve System, subject to concurrence of State laws. 3. Statutory permission to member banks to establish branches should be conditioned upon the approval of administrative authorities, subject to definite requirement that the capital of a branch system be at least the aggregate of the capital that would be required if each banking office in the System were an independent National bank. 4. Administrative authorities should be granted power to require a showing in case of the application for a branch that the general condition of the branch system, as well as the conditions under which the Bureau would operate, indicate the probability of successful maintenance of the proposed branch. 5. The right to establish a branch in any given location within the branching area, should be denied if there is an administrative finding that the banking requirements of the district of the proposed branch are being adequately serviced. 6. There should be legislative grant of discretion to the administrative authorities to require suitable notice of intention to establish a de novo branch or to acquire branches by merger, as well as of discretion to withhold final approval for a reasonable period of time. 7. Subject to the concurrence of the Federal Reserve Board, the to permit or deny branches should be given to the Comptrolleauthority r of the Currency with respect to Notional banks and to the Reserve banks with respect to State member banks. As to Group Banking. The more detailed recommendations upon group banking follow: I. Provisions of law and supervision should require group systems to include as far as may be practicable only National and State member banks, make all of their eligible components members of the Federal Reserve System, and facilitate the development of branch banking within group systems to the limit of legislative grants of power to possess branches. 2. Legislation should prohibit group banking systems from additional component banks of more than one Federal Reserve acquiring District, except with special approval of reserve authorities. 3. Legislation should require that the books and records of a holding company owning or controlling a National bank and/or a State bank, whether acquired prior or subsequent to such legislation member , be made subject to examination by the Comptroller of the Currency and/or the Federal Reserve authorities. Where a group contains both member and non-member banks, the parent corporation and all its components should be subject to examination by Federal authorities. 4. In so far as special regulations may be needed for the expediting examinations of group systems, Federal authorities purpose of should be empowered to require adequate reports of condition of the group banking corporation and of each of its components. 5. In the case of a group banking corporation holding shares of stock of one or more member banks of the Federal Reserve System, there should 53 be statutory requirements for the establishment and maintenance of suitable reserves, invested in readily marketable negotiable assets, other than bank stocks, in order to mist the group system in protecting the solvency of Its components. In general, the amount of such reserves should be not less than 25% of the banking capital employed, except that in cases where double liability attaches directly to the stock of the group banking corporation somewhat smaller reserves might be designated. Such reserves should not be available as security for any form of pledge except for the purposes for which the reserves are required. 6. Legislation should require that after a reasonable time no component of a group banking system could lend upon the security of the stock of the holding company of the group system. 7. A component bank of a group system should be prevented by law from lending to another component of the same group more than 10% of the lending bank's capital and surplus. Its loans to all components of a group system should be limited by law to a reasonable proportion, say 20%, of its capital and surplus. All loans of one component bank to another component should be required to be secured adequately and fully by readily marketable securities or paper of the type rediscountable by a Reserve bank. 8. The capital issues of a holding company of a group banking system should be confined to one class of stock; no debentures or other bond issues should be permitted. 9. Federal law should require that any undertaking to merge or to effect other amalgamation of the stock interests of two or more group banking systems, containing National or State member banks as components, be subjected to the consent of the Federal supervisor y authorities. 10. Federal law should require that any group banking system containing National bank or State member bank components, be prohibited from owning or controlling the stock of a corporation not engaged in the usual business of banking unless it has the permission of Federal authorities vested with power to supervise banking. 11. Upon a finding by the Federal Reserve Board that the components of one or more group systems control the election of directors of a Federal Reserve Bank to the detriment of the interests of other member banks, the Board should have power to limit or suspend the voting privileges of such group components. New York City Bank Stocks Closed 1932 at Higher Levels. Reflecting the improvement in underlying banking conditions, shares of New York City banks enjoyed a steady market during 1932 and closed the year at higher levels, Hoit, Rose & Troster report. They further state: The weighted average of seventeen representative issues opened the year at 48.37. easing off to the record low of 31.34 at the close of May. However, the list held firm above this low during June and continuing through August and early September, a vigorous early July and rally developed which carried the average to the high of 70.76 on Sept. closed Dec. 31 at 58.95 for a net gain on the year of 10.58 7. The average This compares with a net loss on the year of 14.69 points, points, or 21.8%• or 19.7%,for the Dow-Jones average of 30industrials and a net loss on the year of 3.10 points, or 10.1% for the Dow Jones average of 20 public utilities. Calculated on closing bid prices, the range for 1932 of 17 New York City bank stocks was as follows: NEW YORK CITY BANK STOCKS-RANGE FOR 1932. Bankers Brooklyn Trust Central Hanover Chase Continental Chemical City Commercial Corn Exchange Empire Arst National Guaranty Irving Manhattan Manufacturers New York Trust Public National Weighted average Open Jan. 2. Low May 31. High Sept. 7. Close Dec. 31. 56 155 130 2834 1834 2434 3634 135 3334 120 76 19% 1034 2634 2334 95 36 1334 800 160 1134 1434 1534 5334 1634 7454 205 161 48 215( 4034 6434 184 78 3134 1790 358 29 38 3634 100 3434 703( 168 147 3454 1734 3634 4234 155 71 23 1520 338 23 2734 2934 98 2734 as 24 1870 252 1634 28 2734 6954 1934 48.37 31.34 70.76 55 05 Complete Presidential Election Figures Show 22,813,7 86 Votes for Franklin D. Roosevelt Compared with 15,759,266 for Hoover--Four Records EstablishedPoll Was Nation's Largest, and Winner Got Greatest Popular and Electoral Totals-Loser Also Set New High Record. The largest vote in the nation's history, 39,734,351, was cast in the November Presidential election. According to Washington advices, Dec. 24 (copyright by the Associated Press), which, as given in the New York "Times " went on to say: With this record were established three others. received the highest popular and electoral votes Franklin D. Roosevelt ever given to a winning candidate, and President Hoover polled the largest popular vote eve: east for a Weer. Here is the way the votes were distribute d: Roosevelt Hoover 22 R13,786 Others 15 7n,266 1 161.299 Final returns as certified by State officials and compiled by the Associated Press to-day showed the total vote, when compared with the previous record of 36,798.669 in 1928, to have increased 2.935.682, or 7.9%• The 1932 total was only 186,094 less than the Associated Press estimate of the vote, based on registration figures prior to the election. Roosevelt's plurality was 7.054.520. This exceeds Hoover's plurality of 6.423.612 over Alfred E. Smith four years ago, plurality of 7.338,513 polled by Calvin Coolidge but fell short of the record over John W.Davis in 1924. Roosevelt's total was more than the votes for all candidates combined in any election preceding 1920. The previous high for a winning candidate was Hoover's 21.429.109 four years ago. Hoover's 1932 total of 15.159.266 compared with Smith's 15.016.443 in 1928, which was thc previous record for a loser. 54 Financial Chronicle Roosevers Percentage 57.5. Roosevelt's percentage of the total vote was 57.5; Hoover's 39.6, and 2.9. Smith, in 1928. polled 41.2% of the total vote. minor parties Roosevelt carried 42 States, as against 40 by Hoover in 1928 and 37 by Coolidge in 1924. His electoral vote was 472, as against Hoover's 59, the latter coming from Connecticut. Delaware, Maine, New Hampshire, Pennsylvania and Vermont. Four years ago Hoover had 444 and Smith 87. Roosevelt polled more than 1,000.000 votes in each of six States-California, Illinois, Missouri. New York, Ohio and Pennsylvania Hoover passed the million mark in four States-Illinois, New York. Ohio and Pennsylvania. The minor party vote more than tripled that of 1928. Norman Thomas, the Socialist candidate for President, led the field with 881.951, which compared with his 267,835 four years ago and nearly equaled the record for a Socialist candidate-919,799 for Eugene Debs in 1920. The vote for the other minor party candidates was William Z. Foster, Communist, 102.785; William D. Upshaw, Prohibition, 77,528; W. H. (Coin) Harvey, Liberty, 53,446; Verne L. Reynolds. Social-Labor, 34.034; Jacob S. Coxey, Farmer-Labor, 7.431; the Rev. James R. Cox, Jobless, 740; James Ford, 994; John Zahnd, National, 1,615. The 77,528 vote polled by William D. Upshaw as the Prohibition party candidate was the largest given this ticket since the first election after national prohibition was adopted. It was nearly four times the 1928 vote. The Complete Vote. The complete vote for the major parties, as certified by State officials and compiled by the Associated Press, follows -Votes Received- -PluralitiesRooseRooseveil. .Hoover. Stateveil. Hoover. Alabama 34.675 173,235 207,910 Arizona 43.160 79,264 36,104 161,135 189,602 28.467 Arkansas 476,255 California 1,324,157 847,904 Colorado 189,617 61,260 250,877 6,527 287,720 281,193 Connecticut 2.754 57,073 Delaware 54,319 69,170 137,137 206,307 Florida 19,863 214.255 234,118 Georgia 38,086 109,208 71,122 Idaho 449,548 1,882,304 1.432,756 Illinois 677,184 184,870 862,054 Indiana 414,433 183,586 598,019 Iowa 424,204 349,498 74,706 Kansas 394,716 185,858 580,574 Kentucky 249.418 18,853 230.565 Louisiana 37,724 128.907 166,631 Maine 130,130 314.314 184,184 Maryland Massachusetts 800,148 736.959 63,189 Michigan 739,894 131,806 871,700 Minnesota 363,959 236,847 600,806 Mississippi 134.998 140.168 5,170 564,713 460.493 Missouri 1,025.406 78,078 49,208 Montana 127.286 Nebraska 359,082 201.177 157,905 Nevada 16,082 28,756 12,674 New Hampshire 100,608 103.629 3,021 806,394 775,406 30.988 New Jersey 40,872 New Mexico 95,089 54.217 New York 2,534,959 1,937,963 596,996 North Carolina 497,566 208,344 289,222 North Dakota 178,350 71,772 106,578 Ohio 1,301,695 1,227,679 74,016 Oklahoma 516,468 188,165 328,303 Oregon 213,871 136.019 77,852 1,295,948 1,453.540 157,592 Pennsylvania Rhode Island 146,604 115,266 31.338 102,347 1,978 100,369 South Carolina 183,515 99,212 South Dakota 84,303 259,817 Tennessee 126,806 133,011 Texas 753,304 96,682 656,622 116,750 84.775 31,975 Utah Vermont 56.266 78.984 22,718 Virginia 203,9.80 89.637 114,343 Washington 353.350 208,645 144,605 405,124 330.731 74,393 West Virginia 707,410 347,741 359,669 Wisconsin 14,787 Wyoming 54,370 39,583 22,813,786 15.759,266 Totals Roosevelt's plurality, 7,054,520. Values of New York City Bank Stocks End 1932 $240,297,000 above 1931. The recovery which developed in the New York bank stock market during the middle of last year was responsible for the aggregate value of the 16 leading issues registering a gain of $240,297,000 as of Dec. 30 1932 as compared with the aggregate value at the close of 1931, according to records compiled by Hoit, Rose & Troster. The aggregate value of the 16 leading issues was $1,757,416,000 as of the close Dec. 30, which total represented a gain of $70,201,000 or 4% for the week. The gain of $240,297,000 compared with the aggregate value of $1,517,119,000 at the close of 1931 represented a gain of 15.8%. Hoit, Rose & Troster likewise report: The average yield for the 16 leading stocks closed the year at 8.18%, as compared with a yield of 8.59% at the close of 1931. The highest average yield touched at the low point of the bank stock market on May 31 1932 was 13.24%. and the lowest yield for the year established at toe high point of the bank stock market on Sept. 8 1932 was 5.26%. The market value of the 16 issues on Dec. 30 1932 was 1.10 times their known book value as compared with 0.75 times at the close of 1931. and a high of 1.31 and a low of 0.53 for 1932. Based upon the closing figures for 1932 New York City bank stocks are now selling at 14.3 times their known earnings against a high for 1932 of 16.0 and a low of 10.7 on Sept. and June 4 respectively. Record of Insurance Stocks for 1932. Insurance stocks during 1932 were inclined to follow general security market trends, although some irregularity developed in individual issues, Hoit, Rose & Troster report. They add that various issues closed the year at higher levels but were counterbalanced by lower levels reached by several other issues. Opening Jan.2at 25.77,the Hoit, Rose & Troster weighted average of 20 representative issues reached a high of 35.32 Ian. 7 1933 on March 8. Subsequently, the list gradually settled downward to reach the low of 12.62 on July 11. Rallying in sympathy with other securities, insurance stocks improved their market levels and the averages closed Dec. 31 at 23.82, only 1.95 points below the Jan. 2 opening average. Based upon closing bid prices, the range for 1932 of insurance stocks is given as follows by Hoit, Rose & Troster: INSURANCE STOCKS-RANGE FOR 1932. Aetna Casualty Sr Surety Aetna (Fire) Aetna Life Continental Casualty Firemen's (Newark) Globe and Rutgers Great American Insurance Halifax Fire Hanover Fire Harmonia Fire Hartford Fire Home Insurance National Casualty National Fire National Liberty Prov. Washington Phoenix • Travelers U. S. Fire Westchester Fire weighted average Open Jan.2. High Mar.8. Low July 11. 27 25M 2234 11 734 210 1131 834 1534 10 32 1334 7 2734 231 22 39 390 16 1834 40 32 2834 16 1034 250 16 1434 23 1634 41 23 10 3934 434 2934 50 530 2134 24 15 14 8 4 431 35 734 534 1334 5 19 8% 3 18 2 10 23 165 734 434 25.77 35.32 12.62 Close Dec. 31, 37 283i 1234 534 534 65 1234 8 22 734 37 1334 5 38 234 1634 4634 352 1634 18 23.82 Dr. B. M. Anderson Jr. of Chase National Bank on Inter-Allied Debts-Would Defer Payments and Scale Down Future Instalments-Would Also Modify Tariff Policy so Debtors Could Earn Amount to Be Paid. "The Inter-Allied Debts, Politics and Economics" was the subject of an address by Benjamin M. Anderson Jr., Ph.D., Economist of the Chase National Bank of New York, before the St. Louis Chamber of Commerce on Dec. 9. Dr. Anderson, while stating that "it is not necessary to cancel these debts," said: "I do not believe that it is to our economic advantage to insist on immediate payment." "I believe," said Dr. Anderson, "that it is to our economic advantage to reconsider the whole matter, to defer payments for a time, and to scale down the schedules for future payments in many important cases." Dr. Anderson expresses it as his opinion that "we can ultimately collect a good deal, if we modify our tariff policy so as to permit our debtors to earn the dollars they must pay us"; "a change in policy which is necessary in any case," he adds, "for the restoration of trade." In presenting his views, Dr. Anderson said: The economic aspects of the inter-Allied debt question, though not simple, are pretty definite and clear. The political side of the matter, involving cross currents of public opinion in every country, together with disagreements which are, in certain cases, radical as between different countries, is difficult and obscure. Last winter and early last spring the political problem looked almost hopeless, because Germany, France and the United States all seemed quite uncompromising and inflexible. To-day the outlook is much brighter, though very much remains to be done before a settlement can be reached. Economic Aspect*. I would suggest the following as a sound economic view of the matter from the American point of view. It is to our interest to collect as much as we can of these inter-Allied debts without doing a disproportionate damage to our foreign markets and perpetuating the disorder in our own Internal trade and finance. Our own Government needs money, our taxes are going to have to be increased in any case, and our taxpayers are reluctant to assume any snore burdens than are absolutely necessary. If it were a simple question of relieving European taxpayers or relieving American taxpayers, the American economist could give only one answer, and the European economist could make no case. But the fact is that the existence of these debts has been violently disturbing to trade and credit at home and abroad; that the intergovernmental debt fabric, including reparations, Is one of the major causes that brought about the crisis and the great depression, and that the unsettled state of intergovernmental debts Is one of the main causes that perpetuates the depression. It is of no use to our budget or to our taxpayers to collect 250 or 260 million dollars a year from European debtors, even assuming that we could do it, when the effort to make such collection perpetuates the disorder that has pulled our tax receipts down by billions of dollars and has pulled our national Income, including wages, down by tens of billions of dollars. It would be to our economic advantage to cancel the whole thing if that were the only way out-just as it would be to the economic advantage of every one of our debtors to complete an agreement with us and with Germany whereby each of them paid as much as she could and received nothing, in order to get the thing settled and out of the way. Uncertainty regarding the matter, and delay in adjusting the matter, are damaging to every one of us to an appalling degree. It is not necessary to cancel these debts, and I am in favor of collecting as much of them as we can collect, consistent with getting world trade and international credit restored on a sound and permanent basis. I think that we can ultimately collect a good deal, if we modify our tariff policy so as to permit our debtors to earn the dollars they must pay us-a change in policy which is necessary in any case for the restoration of our export trade. I do not believe that it is to our economic advantage to insist on immediate payment. I believe that it is to our economic advantage to reconsider the whole matter, to defer payments for a time, and to scale down the schedules for future payments in many important cases. We supposedly settled these debts, when the adjustment was made, on the basis of ability to pay. As a matter of fact, in the most important case of all, ability to pay was not seriously considered. Great Britain was too proud to raise that question seriously. She funded her debt in full and asked consideration merely on the rate of interest. With respect Financial Chronicle Volume 136 to the rate of interest, she made her main argument on the ground that Great Britain's historic credit standing entitled her to a moderate rate, 81 / 2%, and the main concession that she received in connection with difficulties growing out of the war was that the rate was made 3 rather than 34% during the first 10 years. She counted on trade revival to restore her old strength. It didn't come. Even during the years from 1922 to 1929, when, with short interruptions, we were having an unprecedented period of business activity which much of the rest of the world shared, Great Britain remained depressed, with tax burdens rising and with great and growing unemployment. She expected to get from Germany and from other countries in Europe the money that she was to pay us, but she began to pay us before she began to receive money from them, and she ceased in 1931 to receive payments from Germany or from other countries. She cannot expect in the future to receive payments from Germany on reparations account. She was pulled off the gold standard in 1931. Her taxes, already tremendously high, have been increased still further. Her export trade, her receipts from shipping, her receipts from foreign investments are all drastically cut. I shall submit two sets of figures which have, I think, strong bearing on the ability of our foreign debtors to make payment at the moment. Payment on inter-Allied debts involves two sets of transactions: one, raising the money in the debtor country and in the domestic currency— sterling, francs, marks and the like. This involves taxation and the creation of an excess of taxes over domestic expenditures, though temporarily, of course, funds may be raised by internal borrowing if the credit of the debtor government will stand it. The second is the transfer of the money to the creditor country by selling sterling, francs, marks and the like for dollars, or, in general, for the currency of the creditor country. This is the exchange problem, or the transfer problem. With respect to the ability of our debtors to raise the money at home, the following figures for comparative taxation in the United States and abroad are significant: NATIONAL INCOME TAX PAID FOR 1932 BY MARRIED MAN WITH ONE CHILD. Income. United States. France (25H Prancs=21). England ($3.20). $39 202 802 2,240 22,392 524Q2 If taxation. account be only one source of The national income tax is taken of local and indirect taxes, the comparison shown in the table is essentially unchanged. Furthermore, if account be taken of Involuntary social and insurance contributions, the burden on the average Englishman or Frenchman is even greater, as compared with the average American, who does not make such contributions. Let me add that although the German Income tax rates could not be placed on an exactly comparable basis with those of the other countries, they are the highest of all for all but the very largest incomes, and, taking account of all burdens on the citizen, the German bears the heaviest of all. The American economist will not raise any question of America's duty to lighted the burden on foreign budgets—though the American people do, and should, feel sympathy for the overtaxed people of foreign lands. But our own tax burden is heavy and growing heavier, and must continue to grow heavier unless and until this world financial and economic situation turns upward, in which case our tax burdens can and will be reduced. The principal point about these figures is that they reveal a situation such that it is to our own interest not to increase the pressure. We shall get more out of our debtors over the years if we show consideration now, and If we all work together to get trade and industry going again so that more moderate rates of taxation at home and abroad will bring in very much larger revenues to our Government and to the foreign governments. The second set of figures that I have to present bears on the transfer problem. How is Europe going to make payment here, and, how, above all, Is England going to get the dollars? The great primary source from which the outside world can earn dollars is by sending us goods or performing services for us, the primary source being their exports to us. The biggest service element is entertaining our tourists, though revenues from shipping and some other items are important. The shrivelling of these sources of dollars in 1932 as compared with the period 1926-29 is altogether dramatic. With the decline in foreign trade, shipping receipts have shrivelled, tourists' expenditures are radically reduced, while imports into the United States during the year 1932 have been cut to incredibly small figures. The first 10 months of 1932 show imports of $1,122,000,000 from all the world, as compared with $3,751,000,000 for the same months of 1929. The total Imports to the United States from Europe for the first nine months of 1932 were only $288,000,000 as against a billion dollars in 1929. If we are to try to collect the whole 270 millions per year that our debt contracts call for from our European friends, it would take nearly all the goods they sent us in the first nine months of the current year to make the payments. But, of course, these goods are not available for that purpose, because the first charge against them is payments for the exports which we sent to Europe in the same time, amounting, in the first nine months of 1932, to $565,000,000, leaving Europe short on export and import account with us in the amount of $277,000,000. If we take the 10-month figures for the whole world, again we find the whole world short on export and import account. Our exports to the whole world in 1932 were $1,342,000,000 as against imports of $1,122,000,000—a shortage of $220,000,000. The outside world can pay us with goods only if it sends in more goods than it takes out, and it is not doing that—the balance is the other way. From what other sources, then, can Europe get dollars? The answer Is gold or loans. They can't get loans. The figure for new foreign loans placed in the United States, refunding excluded, for the year 1932 to date is precisely zero. The answer is, to the extent that they pay at all, they must ship gold. And this they are doing, but they are doing it at the expense of deteriorating their own external credit position, which, in the case of England, simply must not be prolonged, in our interests and in the world's interests. Sterling is already off the gold standard; sterling Is already heavily depreciated. Sterling is still the medium through which the major part of Continental European payments are made to us, and sterling is the medium by means of which the outside world generally buys the major part of our cotton and other agricultural exports. It is absolutely contrary to the interest of the people of the United States to have an unbearable burden put on sterling exchange. It is, rather, very definitely to the interest of the people of the United States to facilitate the restoration of sterling to a sound gold basis in the interests of our export trade. It is, moreover, definitely to the interests of the people of the United States to get this whole German situation cleared up. Germany and England between them have been such tremendously big factors in world finance and industry, and have been such exceedingly good customers of $24 ____ $1,000 2,00098 2,000--709 5,000 1,998 448 10,000 18,578 8,588 50,000 an 245 90 naa inn Ann 55 ours, that it is worth our while to go a long way in making adjustments that will help them to get going normally again. Europe has made immense progress toward restoring German credit. The Lausanne Agreement, which virtually wipes out reparations, represented news that WRS incredibly good as compared with anything that we could have expected a year ago. Its final ratification is waiting until the question of debts of Europe to the United States is cleared up. Political Aspects. On the economic side, therefore, it is quite clear that the American people have everything to gain by a prompt and business-like compromise on this matter of inter-Allied debts, which will get the question out of the way, restore world confidence, and permit restorative forces to move in reviving credit and trade and in lightening unemployment, but politically the matter is very difficult. Our people and our Congress grew very angry last winter. Prior to that time we had been disposed to look at these matters as business matters. But, with the failure of the moratorium to accomplish its purpose—it did good, though not enough—our people turned against the outside world, against the Administration, and against anybody else who had had anything to do with foreign political or financial relations. Similar things were happening on the other side. The people of almost every country grew angry and resentful, threw out political leaders, 'Ind mad. difficulties of all kinds in foreign negotiations. Intergovernmental relations are difficult enough at best. Every country has its own peculiarities, its own habits of mind, its own traditions. Every country is more or less suspicious of every foreign country, and this is especially true when there are differences in language. It is especially true when there have been wars between them, and when the textbooks in the schools, on which children have been brought up, glorify the national tradition and place the perfidious foreigner in a bad light. These differences used to be overcome, to the extent that they were overcome in the old days, in large measure through the influence of kings and princes, who used to choose their wives from the daughters of kings and princes in foreign lands, and who had, consequently, family relations of an international sort that tended to soften international animosities. With the growth of democracy, substitutes were found in trained diplomats, state departments, departments of foreign affairs, where, though the head might change with each administration, there remained a permanent staff of trained students of international relations who could keep a certain continuity of international policy, who knew how to respect the special foibles and prejudices of the different countries, and who, working together, would know how to make compromises that would be acceptable to the peoples of the different countries. In connection with these inter-Allied debts, however, a new factor bas come in which adds especial difficulty. Since they involve money, they have been supposed to be the special province of Congress, and as we took that attitude, our European debtors have taken it, and it has come to be considered in France and other countries a matter about which the parliaments have much more to say than is usual in connection with foreign affairs. And thus we have been confronted with a situation in which the American Congress and the French Parliament must come to agreement, if agreement is to be reached. One is in Paris and the other is in Washington. One speaks French and the other speaks English. Neither has the technical professional training in diplomatic relations which is no necessary if each is to avoid stepping on the other's corns and to avoid giving violent offense to the other. Our own Congress has even refused to appoint a debt funding commission to discuss the matter with representatives of European parliaments. There is no agency for direct communication between them. I think, therefore, that we must all welcome as an immense step forward the observation of President-elect Roosevelt that, after all, the Congress has not limited and cannot limit the constitutional authority of the President to negotiate with foreign Powers, even though the Congress must ratify the money settlement which the President may negotiate with a foreign Power. I think that our people are definitely sympathetic with England's difficulties and are appreciative of the fact that England has in many ways and at many times been generous and fair in her international policy. On the other hand, we cannot overlook the fact that our people have a strong and definite conviction that there is no reason why France should not pay in full and that France can easily pay in gold. Our people blamed France for the delay in the moratorium settlement in the summer of 1931; they blamed France for the foreign run on our gold in the autumn of 1931, and for the run in the spring of 1932. They are not enxious to pull more gold out of England, but they would like to have back some of that gold that was sent to France in the autumn of 1931 and in the spring of 1932. What can be said to them with respect to this attitude? First, there are certain financial distinctions which, however, may not seem to mean very much. It is perfectly possible for a government to be poor when the central bank of issue is full of gold. Our Federal Reserve banks to-day are overflowing with gold and our Government has a great deficit. The same thing is true in France. The gold that went out from the United States went to the Bank of France, the Bank of France giving in exchange for it bank notes, demand liabilities, that belong to the French people—not the French Government. The French Government has a heavy deficit and the French people, as shown in the table above, are very heavily taxed. But no case can be made to show that it is financially impossible or even financially very difficult for France to make the particular December payment if she will. If the French Parliament will vote the money and authorize the Government to raise it, the French Government can borrow it in France and with the franc proceeds of the borrowings can get gold from the Bank of France to send over here. But I think it is important for our people to understand the French point of view with respect to these matters, and to make concession to it, not because they are right and we are wrong, but because they believe passionately that they are right and because it is far better to have good will and co-operation among great nations in the grave world crisis than to have a deadlock end a long delay and bitter feeling. The French nation is a nation of ordinary human beings, with the usual hopes and fears and loves and hates that ordinary human beings have. They have been through a greet deal of stress and strain. They have been disappointed in very many of their expectations regarding international financial relations, and regarding international co-operation, they are suspicious and jealous of many foreign countries, end it is possible at this juncture for us to do a great deal toward easing the tension and strain. There are a good many things which the French people have to say In connection with these matters which they are convinced are of great Importance, and which they would like to have us consider. With respect to the contract, for example, which they are now asking us to reconsider, they point out that on their part ratification was preceded by a reservation, namely, that they could only pay what they received from Germany. Our Government took no notice of this reservation, but the French Parliament made It. They therefore say that they could not be accused of bad faith if they adhered to that reservation. The French Government has been courageous 56 Financial Chronicle and in and upright in ignoring this point in its note delivered Dec. 2, saying that it has never considered contesting the juridical validity of the original war debt contracts. They say, further, that America, in 1931, through the moratorium proposal, upset the Young Plan and the system under which they were entitled to payments from Germany, and should therefore feel some responsibility In connection with the financial consequences to France of the cessation of reparations. They point, further, to the joint statement made by our President and their Prime Minister, M. Laval, issued in October 1931, after the conference between them, which they interpret as involving a commitment on our part to rediscuss the debt question with them after they have made an adjustment with Germany. They attach very special importance to the following paragraph in that statement: "In so far as intergovernmental obligations are concerned, we recognize that prior to the expiration of the Hoover year of postponement some agreement regarding them may be necessary covering the period of business depression, as to the terms and conditions of which the two governments make all reservations. The initiative in this matter should be taken at an early date by the European Powers principally concerned within the framework of the agreements existing prior to July 1 1931." And they say further that they have done much more than Laval undertook to do in that statement, because Laval there undertook to make an adjustment within the framework of the Young Plan, which meant very large payments from Germany to France, whereas the Lausanne Agreement scrapped the Young Plan and virtually abolished reparations. If, after that, America makes no concessions to them, they feel that they have a very real grievance. The argument could be very greatly prolonged. It is no part of my purpose to pass judgment on the merits of these French views. It is rather my purpose to raise a question, not only with the very practical business men of St. Louis, but also with all other Americans who are concerned with getting out of the depression, with ending unemployment, with relieving the suffering of many, many millions of human beings. Is it better tactics for us to stand uncompromisingly on the letter of our contract, refusing to discuss it, refusing to compromise, developing bitter feeling between our people and great nations on the other side, or is it better tactics for us to give our Government the support and backing of the American people, so that it may be free to negotiate promptly with those great foreign nations, make the best bargain that it can for us, and bring the thing to a quick solution? That solution, let me say, if it is to be a good solution and a permanent solution, is going to be one which will not satisfy any nation that takes part in it. It is going to be a compromise in which no nation gets all that It wants. But, on the other hand, in the finding of a solution and a quick solution, every nation is going to have enormous gains. Waiting for Elections. We used to have a saying in the United States that politics stops at the water's edge. It used to be a point of pride with us that all parties stood behind the President when it came to a matter of negotiating with foreign Powers. But in these extraordinarily difficult problems involving the payment of money between governments, the executives in France, Germany and the United States have been crippled by political dissensions among their own peoples and in their own parliaments. All have been afraid of the damaging effect, both on internal political organization and on foreign relations, of even conducting negotiations regarding this matter while elections are under way. With the fate of Germany trembling in the balance, it was still necessary to wait last winter and last spring, first for the German Presidential election to be completed, and second for the French elections to be held. After that came the marvelous settlement at Lausanne, a settlement made contingent, however, upon further consideration by us of these intergovernmental debts. But by the time that Lausanne had finished its work our own Presidential campaign was beginning, and although everybody knew that the problem would come before us in an acute form on the 15th of December, the matter was little discussed in the campaign and our public is ill prepared to face the issue. Political machinery moves so slowly, even when it moves in the right direction, that the economist is often very much disheartened. But it is moving. The jealousies, suspicions and fears which existed between France and Germany last winter, and which seemed to present an almost insuperable obstacle to a workable settlement, have been resolved at Lausanne. And the practical American people, who have no political and military fears of the rest of the world, will not long be content to allow their policies to be guided by either resentments or the strict letter of the contract, in orrposition to their own real interests. Bank Need Limited for Special Notes Increasing Circulation Privilege—Currency Expansion Has Failed to Result from Authorization by Congress. Currency expansion has not followed the enactment of the Glass-Borah amendment to the Home Loan Bank Act, which permitted National banks to issue $900,000,000 of new notes, and which Senator Borah (Rep.) of Idaho excepted in his new bill (S. 5076) to repeal the Home Loan Bank Act, according to statistics made available Dec. 7 at the Treasury Department and the offices of the Federal Reserve Board. The "United States Daily" of Dec. 9, noted this and added: Meanwhile the Secretary of the Treasury. the Comptroller of the Currency and the Federal Reserve Board have aligned themselves against continuance of the amendment after it automatically expires three years after passage. National banks themselves have steadily slackened their demands for the notes which the amendment authorizes them to issue. Each month their applications for new money have fallen lower, according to Treasury Department figures. Additional information furnished follows: During November, National banks called for $17,424,000 of the new notes compared with $22,145,350 in October, $43,336,600 In September and $64,858,000 in August. The total asked for through Nov. 30 was $151,174.950, some of which was ordered during the last week in July just after the amendment was approved. Total calls for the notes, therefore, have been less than 17% of the possible issuance under the amendment. As these notes have flowed out to the banks, the total amount of money has failed to rise proportionately. Inflation has not resulted because, with no demand for new funds, the notes have merely replaced other forms of currency. Only quickening business and tighter money conditions could cause the notes to be inflationary. Believing that when such quickening of business does come, the notes may have an inflationary status, the Secretary of the Treasury and the Federal Reserve Board have stated their opposition to the new money as Jan. 7 1933 an uncontrollable7element in the country's monetary system. Federal Reserve notes, which now form the major circulating medium, can be controlled somewhat by the Reserve system, but National banks may draw out notes under the Glass-Borah amendment without restriction other than that laid down In the amendment. Pending business revival only those banks which wish to improve their cash position or reduce their indebtedness will find the notes helpful. The amendment, which was added to the Home Loan Act by Senator Borah and which embodied the plan of Senator Glass (Dens.), of Virginia, permitted National banks to issue notes with Government bonds bearing Interest at not more than 3%% as collateral. A bank could issue notes up to the amount of its capital stock. Formerly only 2% Government bonds could be used as collateral. Because of the National bank notes already outstanding under the old laws, the banks could issue only about $900,000,000 of new money without exceeding their capitalization. Albert H. Wiggin and F. Abbot Goodhue to Sail for Germany Jan. 21 to Represent American Banks at Meeting to Act on "Standstill" Agreement—Joseph C. Rovensky Also to Participate in Meeting. It was learned on Jan.3 that F. Abbot Goodhue,President of the Bank of the Manhattan Co. of New York will sail Jan. 21 on the S. S. Bremen for Germany with Albert H. Wiggin of the Chase National Bank of the City of New York to represent American banks at the meetings in reference to the German Standstill Agreement. Since 1930, Mr. Goodhue has been Chairman of the American sub-committee appointed by American banks in connection with Standstill Agreements between the banks in America and those in Germany, Austria and Hungary. As was indicated in our issue of Dec. 24, page 4310, the meeting will convene in Berlin on Jan. 30 for the purpose of revising the present agreement which expires at the end of February. From the New York "Times" of Jan. 5 we quote: Mr. Wiggin will be accompanied by Joseph C. Rovensky, Vice-President of the Chase, who assisted at the conference that drafted the present agreement in Berlin early last year. Allen Wardwell. a partner in the law firm of Davis, Polk, Wardwell, Gardener & Reed, who is counsel to the American Standstill Committee, is in London and will take part in a preliminary conference there on next Tuesday. The most important of the proposed changes centres about the clause which, in the present agreement, gives creditors the right to convert into blocked reichsmarks their unsecured cash advances for use in certain rigidly restricted ways. Under the new agreement, this privilege would be extended, with certain safeguards, to include acceptance credits. That is, a creditor could call upon his debtor to discharge the obligation in marks. At the same time, arrangements are proposed for liberalizing the Ils08 to which blocked marks can be put, including the financing of exports from Germany. Extension of the right to call for payment in marks may have radical results. There now are In Germany institutions of doubtful solvency which are being protected because under the Standstill Agreement they cannot be asked to pay their debts, even in terms of their own currency. The loosening of these provisons will have the effect, It was remarked in Wall Street yesterday, of "separating the sheep from the goats." It may result In re-establishing the credit of many German banks to the extent that foreign bankers would be prepared voluntarily to extend new credits. Members of Pennsylvania Bankers' Association Offer Aid in Codifying Laws of State—Enactment of New Statutes to Be Urged. The Pennsylvania Bankers' Association, with a membership of 1,163 banking institutions and firms, more than one-half of which operate under the laws of the Commonwealth, is prepared to lend its aid toward a plan for codification of the State banking laws and the enactment of additional legislation having as its purpose the placing of further safeguards around depositors' funds. The Philadelphia "Public Ledger" of Dec. 12 further reported: Dr. William D. Gordon, State Secretary of flanking, and William A. Schnader, Attorney-General of the Commonwealth, are at present drawing up a codification plan, which it Is expected will contain some changes in the banking laws, made necessary by the period of economic depression. Subject Before Council. The subject of codification and the possible changes in the laws WIN considered by the Council of Administration of the bankers' organization at the Bellevue-Stratford on Saturday. O. Howard Wolfe, Cashier of the Philadelphia National Bank and President of the Association, presided, and 25 members of the Council from all parts of the State were present. Opinion prevailed at the meeting that some new banking legislation should be enacted at the next regular session of the Pennsylvania General Assembly, which will meet in January. and it was unanimously decided to co-operate with the Banking Department and the Attorney-General's office in an effort to obtain the beet possible set of laws to govern the banking business in Pennsylvania. Natural Laws at Work. Natural laws without the aid of legislative action are operating In the field of banking to-day as they do in every other activity, according to a report submitted to the meeting by Harry B. McDowell, Vice-President of McDowell National Bank, Sharon, Chairman of the Association's Committee to Uphold the Autonomy of State Banking Laws, Mr. McDowell said that in 1880 there was one bank to every 15,000 of population in the United States. In 1921 the number had grown to one for every 4,000 of population, but at the end of 1932 it had decreased to one for every 6.000 of population. "If there is going to be new National and State banking legislation," Mr. McDowell declared, "it should be based on a certain relationship to population served.' He also called attention to the fact that during the period of business stress 25% of the offices of the banking institutions In Canada, which has a vast branch-banking system, have been closed. Volume 136 Financial Chronicle The speaker registered opposition to the branch bank feature of the Glass Banking Bill, which, if enacted into law, would permit National banks to establish branches in States where laws prohibit branch banking. Alexander Reed, of Pittsburgh, Chairman of the Association's trust Company Section, said the Section's Executive Committee had approved a resolution urging that the State Legislature be given the power to fix proper investments of funds handled in trust estates and in other fiduciary activities. He also said it had been established that mortgages can be carried at a fair market value in making a return on the State 4-mill tax. . Against Chattel Law. The Council decided that it was inadvisable at this time to work for the establishment of a chattel mortgage law in Pennsylvania C. F. Zimmerman, President of the First National Bank of Huntingdon. was re-elected Secretary of the Association for the twelfth consecutive year. Savings Banks in Philadelphia to Reduce Interest Rate on Deposits—Commercial Banks Consider Reduction. A slight reduction in interest rates on savings accounts generally will be paid by Philadelphia banking institutions during 1933, it was learned on Dec. 15, according to the Philadelphia "Public Ledger" of that date, which also had the following to say: The boards of managers of the four mutual saving fund societies during the last week approved a 3% rate to become effective Jan. 1. compared with 33.% paid by three of the institutions this year and 3.65% paid by the fourth. Directors of several commercial banks and trust companies are now giving consideration to a 23 % interest rate on savings accounts, against 3% now being paid. Several banking institutions have lowered the rate of interest on Christmas Club deposits to 2%. Lowered returns received from prime investments, such as United States Government obligations, which form a large part of the investment portfolios of the savings banks and some of the other institutions, figured largely in the decision of the bank representatives to consider the reduced return to depositors. In recent weeks the banks in New York. Boston, Chicago, Baltimore and a number of other cities have announced reduced rates of interest on savings accounts. At a recent meeting of the Council of Administration of the Pennsylvania Bankers' Association, W. Walter Wilson, President of the First Milton National Bank, Milton, and Chairman of the Association's Committee on Rates of Interest on Savings Accounts, declared the banks of the State should give consideration to the payment of a lower rate of interest on such accounts, possibly 2 %. "Safety of principal and not the amount of return received is the principal consideration of savings depositors." Mr. Wilson said Open Policy of Federal Reserve System to Be Maintained. In an announcement issued by the Federal Reserve Board at Washington on Jan. 5, following a meeting of the Open Market Policy Conference of the Reserve System, it is stated that "the Conference has decided that there should be no change in the System's policy intended to maintain a substantial amount of excess reserves, the continuance of which is deemed desirable in present conditions." In full, the Board's announcement follows: Market The Open Market Policy Conference of the Federal Reserve System, with representatives trom all of the 12 Federal Reserve banks in attendance, concluded its meetings with the Federal Reserve Board to-day. The sessions of the Conference were devoted to a review of economic, business, financial and banking conditions in each of the 12 Federal Reserve districts and to the economic and financial situation in the country as a whole. Particular reference was made in the discussions to the workings and effects of the open market policy thus far pursued by the Federal Reserve System during the course of the economic depression. Consideration was also given to the attitude of the System in adjusting its operations to conditions and needs as they may change and develop. The first and immediate objective of the open market Policy was to contribute factors of safety and stability in meeting the forces of deflation. The larger objectives of the System's open market policy, to assist and accelerate the forces of economic recovery, are now assuming importance. Witn this purpose in mind, the Conference has decided that there should be no change in the System's policy intended to maintain a substantial amount of excess member bank reserves, the continuance of which is deemed desirable in present conditions. Adjustments in the System's holdings in the open market account will be in accordance with this policy. From the New York "Journal of Commerce" of yesterday (Jan. 6) we quote: Although banking circles generally expressed the view that the statement was equivocal and utterly failed to end uncertainty as to the specific inten tions of the System's authorities. it was said in one usually informed source that it probably indicated that the present volume of excess reserves would be kept intact as an approximate minimum for the near future. These reserves, which amount to almost $600,000,000 at the present time, are expected to grow with further imports of gold and the return of currency from circulation. Changes Proposed in Maryland Bank Law—Certified Public Accountant Committee Would Ban Loans to Directors and Officers—Annual Audits Urged. A series of suggestions involving drastic changes in the State's "liberal" banking laws was placed before the Maryland Association of Certified Public Accountants at a meeting last night in the Emerson Hotel, Baltimore, on Dec. 13, according to the "Sun" of that city (Dec. 14), which also had the following to say: Included in the series were proposals that directors, officers and employees of a bank be prohibited from borrowing from that institution and that loans to any one borrower could not exceed a sum in excess of 5% 57 of the capital stock and surplus unless approved by the board of directors, but in any event not more than 10%. Annual Audits Urged. It also was suggested that each bank be made to undergo an annual audit by an outside accountant, other than a member of the staff of the State Bank Commissioner and that banks return a monthly statement to the Commissioner instead of three times a year. The suggestions were contained in a report placed before the Association by its Banking Legislation Committee, spokesmen for which said the State's present banking laws were liberal and that actual restrictions on bankers were limited. Vote Due Next Month. The Association is expected to take action on the report next month. If the suggestions are adopted, bills to embody them will be introduced at the coming session of the Legislature. According to the reporting committeemen, the office of the Bank Commissioner is "grossly inadequate" to carry out its work properly. In this regard it was suggested that the fees charged by the Commissioner for examining the banks be increased. Other Suggestions. Other suggestions were: A bank should be prohibited from accepting its own stock as collateral on loans. Investment in bank buildings and fixtures should not be more than 10% of capital and surplus, and in any event not more than $500.090. Banks should be prohibited from lending money to companies under their control. A director should own at least $5.000 worth of stock in the bank he helps to direct. Boards of directors should meet at least once a week. Directors should attend at least two board meetings a month. Writing up of assets should not be permitted and banks should not be allowed to carry any asset on its books above the cost value. In the event of bank failure directors should be personally liable to depositors for losses unless they can show they were not liable for such losses. The last suggestion would shift the burden of proof, in the event of a suit, against the directors. Under the present laws, if depositors attempt to collect from directors they must prove them liable for losses sustained. Offering of $75,000,000 or Thereabouts of 91-Day Treasury Bills. Announcement of a new offering of $75,000,000 or thereabouts of 91-day Treasury bills was made on Jan. 4 by Secretary of the Treasury Mills. Tenders for the same will be received at the Federal Reserve Banks and their branches up to 2 p. m. Eastern standard time on Monday Jan. 9. The new issue is intended to refund maturing bills to the amount of $75,954,000. The latest issue will be dated Jan. 11 1933, and will mature on April 12 1933, and on the maturity date the face amount will be payable without interest. They 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). The announcement of Secretary Mills also says: No tender for an amount less than $1,000 will be considered. Each tender must be in multiple: 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. 9 1933, 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. 11 1933. The Treasury bills will no 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. The bills are sold on a discount basis to the highest bidders. J. Herbert Case and Owen D. Young Re-appointed Directors of Federal Reserve Bank of New York. The following circular announcing the reappointment of J. Herbert Case as Federal Reserve Agent and Chairman of the Board of Directors and of Owen D. Young as a director, was issued Jan: 5, by George L. Harrison, Governor: FEDERAL RESERVE BANK OF NEW YORK. [Circular No. 1151, Jan. 5 1933.1 Appointment of Directors. To all Member Banks in the SeconttFederal Reserve District: In our Circular No. 1144, dated Nov. 16 1932, we announced the results of the election of Class A and B directors of this Bank by member banks Since the date of that circular the Federal Reserve Board has redesignated J. Herbert Case, a Class C director of this bank, as Chairman of the Board of Directors and as Federal Reserve Agent for the year 1933, and has reappointed Owen D. Young as a Class 0 director of this Bank. for a term of three years from Jan. 1 1933, and as Deputy Chairman of the Board of Directors for the year 1933. 58 Financial Chronicle The Federal Reserve Board has reappointed Frederick B. Cooley, President, New York Car Wheel Co., Buffalo, N. Y., as a director of our Buffalo branch for a term of three years from Jan. 1 1933. The board of directors of this Bank has reappointed Lewis G. Harriman, President, M & T Trust Co., Buffalo. N. Y.. as a director of our Buffalo branch for a term of three years from Jan. 1 1933. The board of directors of this Bank has also reappointed Robert M. O'Hara as Managing Director of our Buffalo branch for the year 1933. With these changes the boards of directors of this Bank and our Buffalo branch are constituted as follows' Directors of Federal Reserve Bank of New York. Class A,Group 1.—Albert H.Wiggin, New York City, director,the Chase National Bank of the City of New York. Term expires Dec. 311934. Class A, Group 2.—Edward K. Mills, Morristown, N. J., President, Morristown Trust Co. Term expires Dec. 31 1935. Class A, Group 3.—David C. Warner, Endicott, N. Y., President, Endicott Trust Co. Term expires Dec. 311933. Class B, Group 1.—William H. WoodIn, New York City, President, American Car & Foundry Co. Term expires Dec. 311934. Class B, Group 2.—Walter C. Teagle, New York City, President, Standard Oil Col of New Jersey. Term expires Dec. 31 1935. Class B, Group 3.—Samuel W. Reyburn, New York City, President, Associated Dry Goods Corp. of New York. Term expires Dec. 311933. Class C.—J. Herbert Case, New York City, Chairman. Term expires Dec. 311934. Class C.—Owen D.Young,New York City. Deputy Chairman;Chairman General Electric Co. Term expires Dec. 31 1935. Class C.—Clarence M. Woolley, Greenwich, Conn.,Chairman,American Radiator & Standard Sanitary Corp. Term expires Dec. 311933. Directors of Buffalo Branch of Federal Reserve Bank of New York. Edward G. Miner, Chairman; President. Pfaudler Co. Rochester, N. Y. Term expires Dec. 311933. George G. Kleindinst, President. Liberty Bank of Buffalo. Term expires Dec. 31 1934. Frederick B. Cooley, President, New York Car Wheel Co., Buffalo. Term expires Dec. 31 1935. George F. Rand, President, Marine Trust Co., Buffalo. Term expires Dec. 31 1933. Raymond N. Ball, President, Lincoln Alliance Bank & Trust Co., Rochester, N. Y. Term expires Dec. 31 1934. Lewis G. Harriman, President, M & T Trust Co.. Buffalo. Term expires Dec. 31 1935. Robert M. O'Hara, Managing Director. GEORGE L. HARRISON, Governor. The circular mentioned in the foregoing (No. 1144. dated Nov. 16 1932) was mentioned in our issue of Nov. 19, page 3458. Policy of United States Treasury in Changing From Long Term to Short Term Financing Responsible for Sustained Rise in Price of Long Term Government Bonds, According to F. Seymour Barr. The policy adopted by the United States Treasury Department in transferring its financing operations from long term to short term financing, in line with its adopted policy of utmost flexibility, has been directly responsible for the sustained rise in the price of long term Government bonds experienced during the current year, F. Seymour Barr of Barr Bros. & Co., Inc., told the group conference conducted jointly by the New York Division of the Investment Bankers' Association and New York University, at their weekly session held in the Governors' Room of the New York Stock Exchange on Dec. 1. According to Mr. Barr, this policy also accounts for the fact that in spite of the course of events of the past few years, the credit of the United States is regarded as the highest in the world; it has successfully withstood the shocks causedby the aftermath of the World War; and the present worldwide depression, thus naturally making our national obligations the world's premier investment security. It is manifest that the policy of the Treasury in limiting all recent financing to short-term securities has had an extremely beneficial effect on all Government securities. The last two issues of long term bonds were brought out by the Treasury in June, 1931 and August 1931, Mr. Barr pointed out. He added that it is significant to note that total subscriptions to the August offering aggregated $940,500,000 as against 63,4 billion for the June offering. This indicated most clearly that the supply of long term Government bonds had just about satisfied the demand, in view of the very disturbed and uncertain conditions of that time when England was going off the gold standard, and the Treasury, realizing this, confined all later operations to short term financing. Regarding the current position of the Treasury, Mr. Barr noted that it is now operating at a deficit, which this year may total $1,000,000,000, subject to whatever action the incoming Congress may take. It has been argued, by some, that the financial position of our Government is disturbing, but any such inference is unwarranted because with present conditions completely understood by national and international investors, the credit of the United States, as before mentioned, stands first in the world. Mr. Barr also said: While the largest deficits have occurred in times of war. it is a normal condition in periods of great depression, because revenues normally decline and expenditures are not apt to decrease. The current deficit is comparatively large, but considering the unusual severity of this depression Jan. 7 1933 and because of the exceptional measures taken to arrest the decline. it Is easy to reconcile the figures. An authority in Treasury operations has advised me that a moderate error in a business forecast produces a large error in estimated revenue. The size of the deficit for the current fiscal year cannot be estimated by simply multiplying the deficit of the first four months, namely 8630.000.000 by three, because the new excise taxes have been coming in for only four months, and even then not in full force, and more especially because the new income taxes will not be effective until March 1933, and no estate taxes at the new rates will be payable until June 1933. The Revenue Act of 1932 should prove to be increasingly effective as time goes on but It is not believed that its full benefits will be realized until the coming year. The flexibility of the Treasury's operations will be much easier understood when we realize the freedom which is accorded the Secretary of the Treasury to use his discretion as to the particular kind of securities to be issued. During the last few years, I think you will agree with me that all financing done by the Treasury Department has been definitely timed to take advantage of any favorable conditions obtaining and has been figured so as not to upset the general situation in money and security markets. It is very interesting to note the figures In the Federal Reserve Bank Bulletin, indicating the part the Federal Reserve Bank plays in easing credit in times of stress. As of the close of September this year. Government security holdings of Federal Reserve banks aggregated $1,848,000,000. It is significant that for the past year, as these holdings increased, the rediscounts by Federal Reserve member banks have shown a consistent decrease, thus relieving the member banks from the burden of debt. When you recall that at the present moment there are over 820.000.000,000 of Government obligations outstanding, of which a very substantial amount is held by the banks, that are eligible for such rediscount, it is easily understood why a great majority of the large financial institutions in the country have successfully weathered the storm of this depression. In addition, the assistance given by the Reconstruction Finance Corporation to banks, whose assets were sound but frozen, unquestionably stopped a condition, which If allowed to run its course would have resulted in economic deterioration. Mr. Barr points out that it is expected all moneys advanced by the Reconstruction Finance Corporation will in time be repaid and some of it has already been repaid. He added: The ability of our Government to continually market and also refund Its maturing obligations naturally depends upon the absolute maintenance The of the merit of such obligations with the limiting of their amount. distinctive standing of United States securities is based upon the absolute to confidence in the unwavering Purposes of the Treasury Department in its provide for the necessary payments of principal and interest and the capacity to do so. That capacity has been definitely evidenced in past by the success of the Department in controlling expenditures and providing revenue so that in the final analysis the Government's financial requirements, which, of course, include debt service requirements, will be met from revenues. In this regard it is vitally necessary that the use of Government credit should be restricted entirely to channels commanding general respect and support. that the In such abnormal times as exist to-day, it is very necessary system of Government do its utmost to safeguard and help the economic natural reour country so as to insure the fullest utilization of our great sources of production and employment. R.S. Rife of Guaranty Trust Co. on Problem Confronting Federal, State and Municipal Governments in Meeting Financial Needs—Reduction in Expenditures Essential in Lieu of Increased Taxation— Would Create Surplus to Take up Problem of Unemployment Relief—Also Points to Need of Dealing with Price Level. In discussing tilt, financial and economic situation before the New Jersey Executive Group of the American Institute of Banking in Trenton, on Dec. 9, Raleigh S. Rife, Economist of the Guaranty Co. of New York, said in part: In making an appraisal of our financial and economic outlook, we are cognizant of the fact that there are certain major problems facing the country. The problem of meeting the financial needs of government to-day Is a most pressing one in our municipal, State and Federal governments. For too long a period of time our governmental entities have balanced their budgets from one side of the equation, namely, the effort to find additional sources of revenue. To-day, we are confronted with the definite thought that there are two ways of balancing the budget; one Is by increased taxation, and the other Is by reduction of government expenditures. Those charged with government have already pushed the question of new taxes to a point where it appears as If diminishing returns were setting in and, in some cases, it is almost approaching the point of confiscating what appears to be property rights. It is evident that the economic situation of the country and of the world as a whole is in such a position that those who are in a position of authority in governmental affairs must no longer try to balance the budget by increased taxation. They must turn to the other alternative, namely, reduction of expenditures. In justice to those who have been directing governmental affairs, it should be pointed out that the responsibility for our present state of affairs is a joint one between the public itself and those who are responsible for government. It has peen a phenomenon of the last quarter of a century to see the field of governmental activity widening. New functions of government were to be performed and new bureaus were created to provide for this additional service. The last quarter of a century has seen the development of the automobile which, through the demands of the public, has placed upon governments the responsibility to provide better highways, better paved streets and, due to the increased traffic, better police protection. In order to obtain these better paved streets and highways, it became the fashion to go into debt for the same, municipalities, counties and States issuing their own obligations in order to provide for these additional facilities. It is not likely that the responsibility for the most expensive highway that has ever been built in modern history, namely, the diagonal highway across the Meadows from Jersey City to Newark, was necessarily a concept of politicians and others active in government. but there was a convergence of traffic in that vicinity and the rather insistent demands of the public made possible such a project on the part of the State Government. The ease with which it was possible to pile up debt in periods of prosperlty, when it became an easy matter to discount the future and at the same time formulate a punlic works program for which future generations Volume 136 Financial Chronicle were to pay, almost drives one to the conclusion that the big problem in government finance is to make the creation of debt a difficult problem. Certainly the issuance of obligations that are assessable on the property owner should be tightened so as to make it more difficult for the municipality to become involved in financing an improvement that should have been financed by the property owner. One of the errors that crept into our municipal governments was the method of making improvements that were assessable upon the property owner. He was enabled to obtain an improvement which was based upon an installment purchase program without making any initial deposit. As a matter of fact, he was not facing realities until some years later when the work had been finished and the governing body went through the machinery of figuring up the apportionment of the cost between the municipality and the individual property owner. During this period of time, the tax rate was held down by the municipality having to meet only interest charges and no repayment of principal. Sometimes the delay in assessing the property owner was carried to such extremes that it almost became impossible to assess the property owner without a special Act of the Legislature. If the property owner was required to deposit his first payment when he made a request for the improvement and was to continue to make these payments regularly as a reserve before assessment was made, he would understand more definitely the direct cost of assessment construction. Then, of course. after the property owner became delinquent in his assessments and the municipality, in order to help him out, postponed annual tax sales for a number of years, it was possible as far as he was concerned practically to have passed the period of the tel annual installments before he was brought face to face with the reality of meeting his payments. Obviously, this phase of creating municipal debt should be very carefully safeguarded. When one turns to the study of what can be done to reduce the cost of government, one is impressed first with the magnitude of the debt charges. The interest charges on this debt and the maturing obligations are difficult to adjust, if at all. In times of low money rates, like the present, it is possible for the national governments to carry out refunding operations whereby the holders of government bonds agree to exchange them for a government bond with a lower rate of interest. The most striking instance of this are the two British refunding agreements. It is, of course, not so easy for State, county and municipal governments to be able to effect any such arrangement. Particularly does this apply to those situations in which bonds have been issued on a serial basis and for which there are annual maturities in the budget. Obviously, it is not possible to reduce this item in our governmental budgets; about all that can be done is to adopt a policy tending to prevent the increase of these items. A recent report of the Tax Commission of New Jersey calls attention to the fact that in the ten-year period 1918-1928 the total bonded debt of the Counties and municipalities of the State of New Jersey had grown four-fold. while the assessed values of property only doubled in that period of time This would indicate an increasing debt burden of our municipalities and States and it would seem as if their debt had grown much more rapidly than the values which this debt was supposed to create. In connection with the thought that governments should to-day take every step possible to keep from getting into debt, with unbalanced budgets in our municipal. State and National governments, this seems an impossible end to be reached. With unemployment relief demands increasing, it seems almost an impossibility, but every effort should be made to prevent the increase of dent at this time. We should attempt to balance the budget by curtailing other expenses of the government. We should attempt to create a surplus to take up the problem of unemployment relief. The necessities of the financial situation have perhaps had some blessings in disguise; the local governing bodies of our municipalities are no longer deluged by committees of citizens asking for puolic improvements. It has been relatively easy to stop the program of public works. This thought may be definitely formulated—that a persistence in the policy of "pay as you go" for public works and continue to meet maturing obligations is one of the surest ways in the long run to effect economies in the cost of government. It is an adage that ohe should get into debt in periods of prosperity and get out of debt in periods of depression. It is obvious that the policy of rigid economy of government means that we must decide to get along with less police protection, that owners of automobiles should learn to drive in our streets without having somebody to tell them to stop at corners and street intersections. We must get along with less expenditure for education. All of these moves may be those things that hurt the pride of local government, but in the face of necessity we have to attempt to live within our Income,irrespective of our pride. While we are struggling to-day with our immense problems, we must not, as a people, lose our courage and centre ous attention too much upon the destruction of values. Let us think as well of the creation of values. Certainly the way out is the creation of the pioneer spirit by means of which people push out into the settlement of new areas in which it is possible for them to practically grow their subsistence and in the course of time carve out a new civilization. The old prairie schooner is once more on the road in northwestern Canada. leading migration into the Peace River Valley. Perhaps we are at the threshhold of another period of world expansion. It is an extraordinary fact that the history of recent years points to the fact that in periods of depression a basis is laid for a further period of growth. Another factor in our financial and economic outlook is that dealing with the price level. We find the price level of commodities has tended down to the pre-war level in most world indices, but that level was relatively high because there had been an ascending scale of prices since 1897. In the case of some of our basic raw materials, particularly, an index of prices like that of Bradstreet, which stresses more nearly the price of basic materials, we find that the level is down to the lows of the latter '90's, and in a few cases we find now low prices for all recorded periods of time being recorded, as in the case of rubtee, sugar, coffee and copper. We are learning in the face of large surpluses that when the forces of supply and demand are freely operating, the cost of production does not determine the market value. We get out of it what we can get for the time being. The cost of production will only enter the picture in preventing future production. It is natural, in the presence of such a gigantic fall in the price of certain commodities, and the downward trend of commodity prices, to arrive at the Conclusion that there can be no recovery in business until the price level is adjusted upward, and because of that philosophy of reasoning, gigantic efforts have been formulated for pouring government credit into these situations to try to change the trend of economic forces. Such efforts are futile in their power to change the course of events and are damaging insofar as that through a bullish effort or through its psychological factor tend to circumvent the working out of economic laws. As a matter of fact, the Industrial Revolution in England a century and a half ago made possible the production of certain commodities at a much lower cost and it was an Important factor in the next century, in the expansion of British overseas trade and British overseas investment of capital. All of this technological improvement in industry will be of little value to our world economy unless It does result in lower prices for certain products. The important thing is that up to the present moment of time the great technological advance has not been passed on to the consumer, except in rare instances; the real drop in prices has been in the basic raw materials 59 Renewed Plea of American Foundation for Senatorial Action on United States Adherence to World Court—Separate Appeals by Democratic and Republican Leaders. General James G. Harbord and John W. Davis on behalf of the American Foundation made public on Dec. 11, letters to the members of the United States Senate, urging them to ratify the three pending treaties which would bring about the adherence of the United States to the World Court,or at least to settle the World Court issue on its merits, one way or another, at the short session of Congress. According to the New York "Times" of Dec. 12, the letter to the Democratic Senators was signed by a number of the most distinguished Democratic leaders in the country; that to the Republican Senators is signed by equally prominent Republican leaders. Both letters emphasized those planks of the Democratic and Republican platforms of 1932 which supported the World Court. It was noted that although the letters are identical in purpose, they are somewhat different in subject-matter and entirely different in phraseology. A Washington dispatch dated Dec. 12, published in the "Times" said: The renewed pleas by the American Foundation for Senatorial action on American adherence to the World Court brought no immediate result when presented to the Senate to-day. The plea, announced in New York yesterday, was laid before the Senate by Senator Costigan after he had received the communication addressed to Democratic Senators and signed by a group of prominent Democrats led by James G. Davis. Although a similar message was reported sent to Republican Senators bearing the names of prominent Republicans, it was not put into the "Record." Aside from Senator Costigan's brief description Presented for the "Record," there was no comment on the communication, the Senate going ahead with debate On Philippine independence. Senator Walsh of Montana, leader of the sponsors of the resolution of adherence, said that the World Court resolution would not be urged for immediate attention until pressing legislation had been dispoed of. The resolution of adherence was supposed to have been disposed Of at the last sOSSIOn of Congress, but it was not called up. It is generally understood that a majority of the present Senate is opposed to it. Senators Borah, Watson and Moses sought a vote at the last session, but friends of the resolution delayed calling it up, finally letting it lie over lintll the present session. It is believed on the basis of responsible comment that the resolution will again be left on the calendar at this session. While Senator Borah will sit In the next Congress, Senators Watson and Moses and other opponents of the resolution will have retired to Private life. The next Senate will have a Democratic majority of 22 votes. The attitude of its new members on the World Court is not known, but whether Republicans or Democrats, they are expected to be bound by the platformsof their parties to support adherence to the Court. From the account in the "Times" Dec. 12, we take the following: Use Depression as Reasion. Both letters state the world-wide depression as an urgent reason for Prompt action favorable to the World Court,on the ground that an endorsement by the United States of the Principle of judicial settlement of international disputes would help bring order out of the chaos now existing in the economic relationships of the Nations of the world. The Democratic letter on this point said; "In a world now endeavoring to emerge from economic chaos, there is peculiar need for the stabilizing influence of rational settlement of international disputes. We are well aware that many urgent matters will be brought before this short session of Congress, arising from the difficult situation both at home and abroad. We are clear, however, that this question of completing the adherence of the United States to the World Court has a direct relation to the present state of world affairs. In clearly endorsing the principle of judicial settlement of differences, the United States will.aid in clarifying the whole confused atmosphere of international relations." The Republican letter dealt with this phase of the problem as follows: "Action upon the Court measures has in previous sessions been deferred on the ground that present domestic legislation of an economic nature made it impracticable to take the time for considering the Court treaties. Urgent questions confront the short session also, questions deriving both from the troubled situation at home and from the troubled situation abroad. Far from constituing a reason for again deferring action, the present troubled condition of the world points imperatively to the need for clear endorsement of the stabilizing principle of judicial settlement of those disputes which will continually arise between Nations the more frequently as their economic inter-relations become the more complex." The letters are taken as follows from the "Times": The letter sent by Republican leaders to Republican members of the United States Senate, urging action on the World Court issue at the present session of Congress, together with a list of the signers, follows. To the Republican Members of the United States Senate: We respectfully urge the exercise of your influence on behalf of settlement of the World Court issue at the present short session. The Republican platform of 1932. declaring "America should join 4 its influence and gain a voice in this institution," implies, in our judgment, the Senate's prompt consent to ratification of the pending protocols. Even if the Republican platform were not thus explicit, it would be clear that a question that has been before the country and the Senate for so many years is now entitled to settlement, one way or another, upon the merits. It is 10 years since the court proposal was that sent to the Senate. It is 33 years since the United States, at the first Hague Conference in 1899, first proposed a court of international justice. The court proposed by us in 1899, and again at the second Hague +14 Conference in 1907, was in essential respects like the existing court,"an agency," as Secretary Stimson has pointed out, "more closely In line with the traditions and habit of thought of America than of any other nation." If the United States Is seriously interested in endorsing the principle of judicial settlement, where it is applicable, we cannot logically withhold adherence to the statute of the prsent court. Mr. Hughes, now Chief Justice, pointed out in 1929: 60 Financial Chronicle "So far as we can see into the future, there will be but one court--the Permanent Court of International Justice at The Hague. It is supported by about 50 States. It has performed its function successfully, with a gratifying degree of confidence reposed in it, as is shown by the increasing volume of its work. It is idle to suppose that any other permanent court 'could be established." The court measures are already legislatively advanced. The question facing us is no longer the primary general question whether the United States should adhere to the court. That question was answered by the Senate resolution of 1926, providing that the United States should adhere on certain conditions. The present question before the Senate is whether the pending protocols meet these conditions. The Department of State, after a careful study, announced in 1929. through Secretary Samson, that the pending protocols entirely meet the 1926 reservations; and the Secretary repeated and expanded this conclusion to the Foreign Relations Committee of the Senate last Spring; "The longer I have reflected upon these protocols the more clear I am that not only have the conditions originally imposed by the Senate reservations been fully met, but that additional machinery has been provided for preliminary negotiations which greatly enhances the efficacy of the reservations themselves." The court, by its statute and by the terms of the protocols now proposed, Is restrained from giving either a judgment or an advisory opinion in any dispute that concerns us, without the explicit consent of the United States. The position of the United States is fully protected. Action upon the court measures has in previous sessions been deferred on the ground that pressing domestic legislation of an economic nature made It impracticable to take the time for considering the court treaties. Urgent questions confront the short session also, questions deriving both from the troubled situation at home and from the troubled situation abroad. Far from constituting a reason for again deferring action, the present troubled condition of the world points imperatively to the need for clear endorsement of the stabilizing principle of judicial settlement of those disputes which will continually arise between nations, the more frequently as their economic interrelations become the more complex. We urge that the delay on the court measures now be terminated and that,in accord with the spirit of the 1932 Republican platform, the question of ratifying the three pending Protocols to expedited on the calendar of the short session, in order that the record vote may be reached before the fixed date of adjournment on March 4. General JAMES GUTHRIE HAR- GARDNER COWLES, Des Moines, HORD, New York City. Iowa, publisher of the Des Moines HARRY CHANDLER, Los Angeles, "Register Tribune," member Reconpublisher of the "Los Angeles Times." struction Finance Corporation. ROBERT LINCOLN O'BRIEN, Bos- GEORGE HENDERSON, Cumberland, ton. publisher of the "Boston Herald," Md., Mayor of thunberland. chairman United States Tariff Com- JOHN CROSBY, Minneapolis, Washmission, burn Crosby Co. CHARLES D.HILLES, New York City, RUSSELL M.BENNETT,Minneapolis. Republican National Committeeman FRANK G. ALLEN, Boston, former for New York State. Governor of Massachusetts. WILLIAM COOPER PROCTER, Cin- ALLYN L. Brown, Norwich, Conn., cinnati, President Procter Os Gamble senior Judge of the Superior Court of Co. Connecticut. HENRY D. SHARPE, Providence, RALPH E. WILLIAMS,Portland, Ore., President Brown tit Sharpe Manufacvice-chairman Republican National turing Co. Committee. SILAS H. STRAWN, Chicago, former SAMUEL R. McKELVIE, Lincoln, President American Bar Association, Neb., former Governor of Nebraska, former President United States Chammember of the platform committee of ber of Commerce. the 1932 Republican National ConWILLIAM H. CROCKER, San Franvention, publisher of the "Nebraska cisco, President Crocker First NaFarmer." tional Bank,Republican National Com- ROBERT SMITH, Omaha, Neb., chairmitteeman for California, 1916-32. man Republican State Committee of HENRY I. HARRIMAN, Boston, Nebraska. President Chamber+ of Commerce of FRED A. HOWLAND, Montpelier, the United States, chairman board of Vt., President National Life Insurance trustees Boston Elevated Railway, Co. vice-chairman board of directors New FREDERICK L. PERRY, New Haven England Power Association. attorney. WILLIAM G. MATHER, Cleveland, FRANK G. LESLIE, Minneapolis. Vice-President Cleveland Cliffs Iron FRANK T. POST, Spokane, Wash., Co., chairman of the board Otis Steel Vice-President and General Counsel Co. Washington Water Power Co., former HOWARD J. HEINZ,Pittsburgh, PresiPresident Washington State Bar Assodent H. J. Heinz Co. ciation. WILLIAM J. DONOVAN, Buffalo. JOHN G. SARGENT, Ludlow, Vt., assistant to the Attorney General of former Attorney General of the the United States. United States. WILLIAM M. MALTBIE, Hartford, CHARLES HEBBERD, Spokane, Chief Justice of the Supreme Court of Wash., former chairman Washington Errors of Connecticut. State Republican Committee. NATHAN WILLIAM MacCHESNEY, JOHN R. MoLANE, Manchester, N. H., Chicago, former President Illinois chairman New Hampshire State Board State Bar Association, Vice-President of Arbitration and Conciliation. American Bar Association,Judge Advo- CHARLES ELMQUIST, St. Paul cate. G. H. Q., A. E. F., France, attorney. General Pershing's staff, 1918-19. PERCIVAL P. BAXTER, Portland, JAY N. DARLING, Des Moines, Iowa, Me. former Governor of Maine. member of the platform committee of SAMUEL PLATT, Reno, member of the the 1932 Republican National Conplatform committee of the 1932 Repubvention. lican National Convention. C. B. MERRIAM, Topeka. Kan., Vice- WILLIAM B. HARRISON, Louisville, president Central Trust Co. Mayor of Louisville. HENRY M. BUTZEL, Detroit, Justice GEORGE F. BOOTH, Worcester, of the Supreme Court of Michigan. Mass., publisher Worcester "Telegram FREDERICK S. CHASE, Waterbury, and Evening Gazette," former PresiConn., President Chase Brass and dent New England Newspaper AlliCopper Co. ance. W.C. KINCAID, Cheyenne, member of LOUIS K. LIGGETT, Boston, former the platform committee of the 1932 National Republican Committeeman Republican National Convention. for Massachusetts, President United LLEWELLYN L.CALLAWAY,Helena, Drug Co. Mont., Chief Justice of the Supreme MILTON C. LIGHTNER, St. Paul, Court of Montana. member of the State Senate for the CHARLES F. SCOTT, Iola, Kan., Fortieth District of Minnesota. member of the platform committee of ISAAC M. MEEKINS, Elizabeth City, the 1932 Republican convention,former N. C., judge of the United States DisCongressman. trict Court for the Eastern District of PAUL SHOUP, San Francisco, viceNorth Carolina,former chairman of the chairman Southern Pacific Railroad. Republican State Committee. C. A. MCCLOUD, York, Neb., Repub- GEORGE C. BAKER, Morgantown, W. lican National Committeeman for Va. Nebraska. JOHN M. CRAWFORD, Parkersburg, HOMER P. CLARK, St. Paul, vizeW. Va. Chairman of the board Federal Reserve WALTER J. HARRIS, Reno banker. Bank of Minneapolis. chairman West H. C. OGDEN, Wheeling, W. Va., pubPublishing Co. Haber of the Wheeling "Intelligencer" LESTER D. SUMMERFIELD, Reno, and other West Virginia newspapers. le attorney. E. G. LARSON, Valley City, N. D., Mrs. WORTHINGTON SCRANTON, Treasurer and Manager Agricultural Scranton, Pa., Republican National Credit Co. of Valley City. F Committeewoman for Pennsylvania. WILLIAM A. CANT, Duluth, judge of Dr. ROBERT A. MILLIKAN, Pasathe United States District Court, dena, director Norman Bridge LaboraMinnesota. tory of Physics, California Institute of WIRY FRANKLIN, Ardmore, Okla., Technology. President Wirt Franklin Petroleum JAMES B. FORGAN Jr.. Chicago, ViceCorp. President First National Bank of HENRY F. LIPPETT, Providence, former United States Senator from Chicago. Rhode Island. EDGAR H. EVANS, Indianapolis, President Acme-Evans (milling) Co., EDWARD DUFFIELD, Princeton, N. J., President Prudential Life Insurformer President Millets' National Federation. ance Co. of America. Jan. 7 1933 R. A. NESTOS, Minot, N. D., member E. T. WEIR, Pittsburgh, chairman Naof the platform committee of the 1932 Ronal Steel Corp. Republican National Convention, for- Governor WILLIAM TUDOR OAR.' mar Governor of North Dakota. DINER of Maine. The letter sent by Democratic leaders to Democratic members of the United States Senate, urging action on the World Court issue at the present session of Congress, together with the list of signers,follows: To the Democratic Members of the United Slates Senate: As the short session opens we think it in order to emphasize the clear implication of the Democratic platform of 1932 recommending "adherence of the United States to the World Court with the pending reservations." In fulfillment of the clear purpose of this platform, we respectfully urge the exercise of your own influence toward expediting the Court on the Senate calendar at the short session, in order that the record vote on the Court measures may no reached before adjournment on March 4. Our hope is that you share our view that the Senate should consent to the ratification of the three pending treaties, which were favorably reported to the Senate by the Foreign Relations Committee on June 1 last, and wnich, when ratified, will achieve the adherence of the United States to the Court. Whether or not, however, you agree with us that the prompt adherence of the United States to the court is desirable, we assume you share our conviction that a question that has been so long pending is now entitled to settlement on the merits. The Court question is, in a peculiar sense, the "unfinished business" of the Senate. The question now before the Senate is not whether adherence is desirable (answered by the passage of the Senate resolution in 1928), but whether the three pending protocols meet the Senate's 1926 reservations. In our judgment they do. We note witn pleasure that Democratic leaders generally have agreed with the administration that the conditions originally imposed by the Senate's reservations have been unequivocally met. That conclusion has been bulwarked by expert study on the part ofsuch authoritative bodies as the American Bar Association, which, through its appropriate committee (in a report later adopted by the whole association), has clearly stated that the pending protocols adequately protect the interests of the United States in every respect and clearly fulfill the Senate's 1926 reservations. During the ten years in which the general question of adherence has been pending in the Senate of the United States (it will be ten years in Feoruary since the proposal for adherence to the Court was first sent through to the Senate) the Court has gone quietly on its way, performing, within its limited field, toe function of applying judicial settlement to certain classes of disputes. Forty-four questions, indeed, have been successfully adjudicated, and we know of no case in which the judgment of the Court, whether in the form of a decision or in the form of an advisory opinion, has failed to be observed by the parties concerned. In a world now endeavoring to emerge from economic chaos there is peculiar need for the stabilizing influence of rational settlement of international disputes. We are well aware that many urgent matters will be brought before this short session of Congress, arising from the difficult situation both at home and abroad. We are clear, however, that this question of completing the adherence of the United States to the World Court has a direct relation to the present state of world affairs. In clearly endorsing the principle of judicial settlement of differences, the United States will aid in clarifying the whole confused atmosphere of international relations. We bespeak your individual aid in fulfilling our 1932 platform by early consideration of the Court protocols in order that the record vote may be reached before March 4. JOHN W. DAVIS, New York City,• SAMUEL W. FORDYCE, St. Louis, former Ambassador to Great Britain, Counsel War Finance Corporation, NEWTON D.BAKER,Cleveland,former 1918-19; former Chairman Missouri Secretary of War. State Democratic Committee. JAMES M. COX, Dayton, former Gov- GEORGE FORT MILTON, Chattaernor of Ohio; publisher of the "Ohio nooga, publisher of the Chattanooga News League." "News." GILBERT M. HITCHCOCK, Omaha, FRED W.MoLEAN,Grand Forks, N.D. publisher of the Omaha "World DONALD A. MoDONALD, Seattle, Herald" former United States Senator: member Washington State Legislature. Chairman of the platform committee JOHN STEWART BRYAN, Richmond, of the 1932 Democratic National ConPublisher of the Richmond "News vention. Leader. EVANS WOOLLEN,Indianapolis, Presi- PARK H.POLLARD,Proctorsville, Vt., Chairman Democratic State Commit-1 dent Fletcher Savings & Trust Co. tee of Vermont. W. A. JULIAN, Cincinnati, Democratic A. C. WEISS,Duluth,former member of National Committeeman for Ohio. ROLAND S. MORRIS, Philadelphia, the advisory board of the Democratic National Committee. former Ambassador to Japan. JOSEPHUS DANIELS, Raleigh, N. C. SAMUEL 0. TANNAHILL, Lewiston, former Secretary of the Navy; publisher Idaho, Democratic National Committeeman for Idaho. of the Raleigh "News and Observer." VANCE MeCORMICK,Harrisburg, Pa. JOHN S. TAYLOR, Largo, Fla. publisher of the Harrisburg "Patriot ROBERT G. KELLY, Charleston, W. Va., Chairman Democratic State Comand Evening News." WILLIAM GONZALEZ,Columbia,S.C., mittee. editor of the Columbia "State" former JEROME T.FULLER,Centreville, Ala. Minister to Cuba; first American AmChairman Democratic State Commitbassador to Peru. tee of Alabama. GOVERNOR WILBUR L. CROSS of BORDERN BURR, Birmingham, Ala., Connecticut. attorney. FREDERICK D. GARDNER, St. DR. JOHN E. BACON, Miami, Ariz., Louis, former Governor of Missouri. surgeon, member of the platform consALFRED E. SMITH, New York City. tee of the 1932 Democratic National former Governor of New York. Convention, GOVERNOR A. HARRY MOORE of T. W. GREGORY, Houston, Texas, New Jersey. former Attorney-General of the United GOV.-ELECT LESLIE A. MILLER of States. G. C. DePUY, Grafton, N. Dak. Wyoming. GOVERNOR JOHN G. POLLARD of MRS. JESSIE WOODROW SAYRE, Cambridge, Mass. Virginia. GOVERNOR GEORGE H. DERN of JAMES S. DOUGLAS, Douglas, Ariz., President Bank of Douglas, Vice-PresiUtah. GOV.-ELECT THEODORE FRANCIS dent Cananea Consolidated Copper GREEN of Rhode Island. Co. GOV.-ELECT WILLIAM COMSTOCK THOMAS J. SPELLACY, Hartford, of Michigan. Attorney, former Assistant AttorneyMORRJSON SHAFROTH, Denver, former member Democratic State THOMAS HEWES,Hartford, Attorney. DESHA BRECKENRIDGE,Lexington, Executive Committee. W. W. GRANT JR., Denver, former Ky., publisher of the Lexington "Herald." President Colorado Bar Association. JOHN R. HARDIN, Newark, President LaRUE BROWN,Boston,former AssistMutual Benefit Life Insurance Co. ant Attorney-General of the United States, former General Solicitor United 0. G.ELLIS, Tacoma,former Chief Justies of the Supreme Court of WashStates Railroad Administration. ington. E. P. CARVILLE, Elko, Nev., Judge of JOHN E. MARTINEAU, Little Rock, the District Court. Ark., Judge United States District ROBERT C. MURCHIE, Concord N. H., member of the platform committee Court, Arkansas: former Governor of Arkansas. of the 1932 Democratic National ConWILLIAM R. PATTANGALL,Augusta, vention, former Assistant AttorneyMe., Chief Justice Supreme Court of General of the United States. DAVID COKER, Hartsville, S. C., Maine. MERLE D. VINCENT, Denver, Exec. plant breeder, Preeldent Coker's Pedl! Vice-President and General Manager greed Steed Co., director Federal ReRooky Mountain Fuel Co. serve Bank of Richmond. J. C. W. BECKHAM, Louisville, former M. M. CRANE, Dallas, former member Governor of Kentucky, former United of the Texas House of Representatives, States Senator, former member of the Texas Senate. JOHN J. CORNWELL,Romney, W.Va. OSWALD WEST,Portland, Ore., former former Governor of West Virginia. Governor of Oregon. Volume 136 Financial Chronicle WILLIAM T. KEMPER, Kansas City, CLARK HOWELL, Atlanta, Ga. :pubMo., former Democratic National lisher the Atlanta "Constitution', forCommitteeman for Missouri, President mer member Democratic National ComKemper Mill & Elevator Co., Kemper mittee, director of the Associated Press. Investment Co. Dividend Distributions of Building and Loan Associations in Last Six Months of 1932 at $175,000,000. Total dividend distributions of the building and loan associations for the last half of 1932 will reach $175,000,000 by Jan. 1, H. F. Cellarius, Cincinnati, Secretary-Treasurer of the United States Building and Loan League reports. This payment of earnings to some 11,500,000 shareholders in home financing institutions is in line with their practices of the past 102 years that they have been in operation, Mr. Cellarius points out. On Jan. 3 the business celebrated the 102nd anniversary of the first association established in this country. Mr. Cellarius reports: During the past year some $425,000,000 was distributed in the form of dividends to holders of building and loan shares. This represents the continued use of the savers' funds to finance home owners who place their Obligation on the home first above all other expenditures. Dividends which the associations pay are derived from the home borrower's payment of carrying charges. The continued ability of the building and loans to pay substantial dividends is a witness to this fundamental characteristic of the home-owner as a debtor. It is this same stability of the home-owner which makes the building and loan business confident that this nation still has the fundamental courage and perseverance to pull itself up into recovery. When we consider the payment of this dividend and the payment of the interest on home loans which made the dividend possible, we realize again that the major portion of the people are continuing in employment and living normal lives. Because the associations are increasing their reserves and adding to the safety of the savers' funds, the dividend rates of many of the associations have been reduced by M or I% for the semi-annual period ending Jan. 1. Death of Calvin Coolidge, Former President of United States—President Hoover Issues Proclamation for 30-Day Period of Mourning—Senate and House Adjourn—Governor Lehman of New York Also Proclaims 30-Day Mourning Period. The unexpected death on Jan. 5 of Calvin Coolidge, former President of the United States, brought world-wide expressions of sorrow and numberless tributes in memory of the former head of the nation. The sudden death of Mr. Coolidge on Jan. 5 occurred at his home at Northampton, Mass. Describing his death, Associated Press accounts from that city on Jan.5 said: Calvin Coolidge, thirtieth President of the United States, died suddenly to-day. He was sixty years old last July 4. Returning from a shopping tour, Mrs. Coolidge found the body of her husband on the bed in a room at The Beeches, the estate to which he retired at the conclusion of his career at the National Capital. His death was wholly unexpected, although for the past three weeks Mr. Coolidge had complained of indigestion. Doctors said death was due to heart failure. • The former President, who up to the time of his death was the only surviving ex-President of the United States, had gone to his law office as usual this morning. After a short time in the office Mr. Coolidge became distressed and decided to return home. Harry Ross, his secretary, returned to The Beeches with him, Mrs. Coolidge, meanwhile, had gone to the center of the city shopping. Mr. Coolidge assured Ross that he would be all right after a short rest and, after aiding the former President to the bedroom, Ross returned to the first floor of the house to await the return of Mrs. Coolidge. When Mrs. Coolidge, twenty minutes later, returned and Ross told her of Mr. Coolidge's illness she went immediately to his bed room. There she found her husband's body. A doctor was quickly summoned but the former President was beyond aid. The doctor said Mr. Coolidge had been dead about fifteen minutes,so that he must have passed away within a few moments after Roes left the room. Official announcement of the death of Mr. Coolidge was made by President "Hoover in the following proclamation issued on Jan. 5, calling for a 30-day period of mourning: Announcing the death of THE HONORABLE CALVIN COOLIDGE By the President of the United States of America A•Proclamation To the People of the United Slates: It becomes my sad duty to announce officially the death of Calvin Coolidge, which occurred at his home in the city of Northampton, Massachusetts, on the fifth day of January, nineteen hundred and thirty three, at 12.25 o'clock in the afternoon. Mr. Coolidge had devoted his entire life to the public service, and his steady progress from Councilman to Mayor of Northampton and thence upward as member of the State Senate of Massachusetts, Lieutenant. Governor and Governor of Massachusetts to Vice-President and President of the United States stands as a conspicuous memorial to his private and public virtues, his outstanding ability and his devotion to the public welfare. His name had become in his own lifetime a synonym for sagacity and wisdom; and his temperateness in speech and his orderly deliberation in action bespoke the profound sense of responsibility which guided his conduct of the public business. From the American people he evoked an extraordinary warmth of affectonate reponse to his salient and characteristic personality. Fie earned and enjoyed their confidence in the highest degree. To milliom of our people his death will come as a personal sorrow as well as a public losa. As an expression of the public sorrow, it is ordered that the flags of the White House and of the ses eral departmental buildings be displayed at half-staff for a period of 30 days, and that suitable military and naval honors under orders of the Secretary of War and the Secretary of the Navy may be rendered on the day of the funeral. 61 IN WITNESS WHEREOF, I have hereunto set my hand and caused the seal of the United States to be affixed. DONE at the City of Washington this fifth day of January. in the year of our Lord nineteen hundred and thirty-three, and of the independence of the United States of America the one hundred and fifty-seventh. HERBERT HOOVER. By the President; HENRY L. STIMSON, Secretary of State. President Hoover also sent a special message as follows to Congress Jan. 5, officially notifying that body of the death of former President Coolidge: "To the Senate and House of Representatives: "Ms my painful duty to inform you of the death to-day of Calvin Coolidge, former President of the United States. "There is no occasion for me to recount his eminent services to our country to members of the Senate and House, many of whom were so long associated with him. His entire lifetime has been one of single devotion to our country and his has been a high contribution to the welfare of mankind. "HERBERT HOOVER." The Senate adjourned immediately at 1:58 p. m. As to its action and that of the House, the "United States Daily" of Jan. 6 said: A motion, made by Senator Watson (Rep.) of Indiana. Majority leader, and concurred in by Senator Robinson (Dem.). of Arkansas. Minority Leader, was entered in the midst of a speech by Senator Glass (Dem.), of Virginia, who was discussing his banking bill. In presenting the motion, Senator Watson described Mr. Coolidge as "a great man, a great President and a great American," and to this tribute Senator Robinson added it was a distressing fact to the Nation to lose the advice and counsel of a man having the qualities of the former President. Numerous other Senators later issued statements in tribute to Mr. Coolidge's service as President and his life work. House of Representatives Adjourns. The House stopped its farm relief debate to adjourn at 3 p. m., immediately upon receiving the President's message of notification. Speaker Garner (Dem.), of Uvalde. Tex., ordered the message read to the House, and Minority Leader Snell (Rep.). of Potsdam, N. Y., offered the resolution on the part of the House. The resolution was adopted. It read as follows in full text"Resolved, that the House has learned with profound sensibility and sorrow of the death of Calvin Coolidge, former President of the United States. Resolved, that as a token of honor to the many virtues, public and private, of the illustrious statesman, and as a mark of respect to one who has held such eminent station, the Speaker of this House shall appoint a committee to attend the funeral of Mr. Coolidge on behalf of the House. Committee Is Designated. "Resolved, that the Clerk communicate these resolutions to the Senate and transmit a copy of the same to the afflicted family of the illustrious dead. Resolved that the Sergeant at Arms of the House be authorized and directed to take such steps as may be necessary for carrying out the provisions of these resolutions, and that the necessary expenses in connection therewith be paid out of the contingent fund of the House. Resolved, that as a further mark adjourn.. of respect to the memory of the late Calvin Coolidge, this House do now The funeral committee appointed by Speaker Garner is as follows. Representatives Rainey (Dem.),of Carrollton, Ill., Majority Leader of the House; Snell (Rep.), of Potsdam, N. Y., Minority Leader of the House; Hawley (Rep.), of Salem, Oreg.; Montague (Dem.). of Richmond. Va.; Treadway (Rep.), of Stockbridge, Mass.; Darrow (Rep.), of Philadelphia, Pa.; Pinkham (Rep.). of Boston, Mass.; Luce (Rep.), of Waltham, Mass.; Underhill (Rep.), of Somerville, Mass.. Connery (Dem.). of Lynn, Mass.; Gibson (Rep.), of Brattleboro, Vt.; Greenwood (Dem.), of Washington. Ind.; Douglass (Dem.), of Boston, Mass.; Douglas (Dem.), of Phoenix. Ariz.; McCormack (Dem.), of Dorchester, Mass.; and Granfield (Dem.). of Longmeadow. Mass. President to Attend Funeral At the White House it was announced orally Jan. 5 that President Hoover would attend the funeral offormer President Coolidge,although it was added that so far as known there the time and date of the funeral had not been arranged. At the same time, it was said that representatives of all branches of the Government, including members of the Cabinet, would attend the funeral. • The Senate yesterday (Jan. 6) adjourned until Monday next out of respect to the former President. From a Washington dispatch to the New York "Evening Post" of last night we quote: Before adjourning. the Senate passed a resolution expressing its "profound sorrow and deep regret" at the news of the former President's death. authorizing appointment of a committee of 24 Senators to attend the funeral and directing that a copy of the resolution 1 e transmitted to the family. Senators Appointed. Vice-President Curtis appointed the following Senators as a committee to attend the funeral; Watson, Robinson of Arkansas, Hale, Swanson, Moses. Ashurst, McNary. Keyes., Pittman, Reed, Fees, Walsh of Montana, Dale, Glass, Metcalf, Copeland, Bingham, Walsh of Massachusetts, Hebert, Barkley, Dasis. Coolidge, White and Austin. The resolution creating the committee was presented by Senator Wash of Massachusetts, Phe text of the Walsh resolution read: "Resolved, That the Senate has heard with profound sorrow and deep regret the announcement of the death of Hon. Calvin Coolidge, late a President of the United States. "Resolved, That a committee of 24 Senators be appointed by the VicePresident to join such a committee as may be appointed (already named) on the part of the House of Representatives, to attend the funeral of the deceased. "Resolved. That the Secretary communiate these resolutions to the House of Xtepresentatives and transmit a copy thereof to the family of the deceased. After the Senate adjourned, it was decided to increase the Senatorial funeral committee to 25 and Senator Smoot of Utah, dean of the Senate, was added to the list. The Utahan at first had thought he could not leave his duties in connection with the Appropriations Committee. When the House adjourns later to-day it also will adjourn until Monday as a mark of respect to the former President. President Hoover, together with Mrs. Hoover and a large number of Congressional and other Administration leaders, left Washington last night to attend the funeral services of the former President, which will be held at 10:30 this 62 Financial Chronicle morning (Jan. 7) in the Edwards Congressional Church in Northampton. Interment will take place in the Coolidge plot in Plymouth, Vt. Associated Press advices from Northampton yesterday (Jan. 6) said: Hardly a man or woman who had served with Mr. Coolidge from his early days in the Massachusetts Legislature to the time he was Chief Executive of the nation failed to extend sympathy to Mrs. Coolidge. Messages came from President Machado of Cuba, Charles G. Dawes, Andrew W. Mellon, Walter E. Edge, Ambassador to France; Joseph Grew, Ambassador to Tokio; Hugh Gibson, Ambassador to Belgium; Elihu Root, Sir Esme Howard, former British Ambassador, and from the high and low in the executive life of most of the States of the Union. . . . By dawn to-morrow the friends of Calvin Coolidge will have assembled In this small city in central Massachusetts. At 8 o'clock Mr. Coolidge's body will leave his home at The Beeches for the church. Militia on Guard. A guard of honor from the National Guard will stand by the bier while It lies in state. At 1010 o'clock the services wil begin. They will be brief and simple with the Rev.Albert J.Penner, the young cleric who in past months was often pleased by the former President's commenton his sermons, officiating. The principal incidents in the career of former President Coolidge are thus summarized in the New York "Times": Born July 4 1872, at Plymouth, Vt. Graduated at Amherst College, 1895. Elected member of Northampton Common Council, 1900. Elected clerk of Northampton, 1904. Married Grace A. Goodhue of Burlington, Vt., 1905. Elected member of Massachusetts Legislature. 1907. Mayor of Northampton, 1910-1911. Member Massachusetts Senate,1912-1915;PresidentofSenate, 1914-1915. Elected Lieutenant-Governor, 1916. Elected Governor of Massachusetts, 1919. Elected Vice-President of United States, 1920. Assumed Presidency on death of President Harding, Aug. 3 1923. Elected President of United States, 1924. Retired from White House March 4 1929. Besides Mrs. Coolidge, the former President is survived by his son, John B. Another son, Calvin, Jr., died in July, 1924, during Mr. Coolidge's term as President. On Jan. 5 the following proclamation was issued by Gov. Lehman of New York: The people of the State of New York mourn the loss that the nation has sustained in the death of former President Coolidge. His calm, deliberate, constructive guidance of the destinies of our great Republic will make his memory forever cherished by a grateful people. His passing Is a calamity, but the whole world is better for his life and work. Now, therefore, I, Herbert Lehman, Governor of the State of New York, extend to his bereaved family the tenderest sympathy of the people of this State and I do hereby order the flag placed at half-staff on all public buildings for a period of thirty days. Given under my hand and the privy seal of the State at the Capitol in the city of Albany this fifth day of January, in the year of our Lord,one thousand nine hundred and thirty-three. HERBERT H. LEHMAN. Tributes to Late President Calvin Coolidge by Thomas Cochran of J. P. Morgan & Co. and Other New York Bankers. Among the countless tributes to the late Calvin Coolidge, former President of the United States, who died Jan. 5, we have room here for only a few, as follows: Thomas Cochran of J. P. Morgan & Co.: The country will feel Mr. Coolidge's death as a great loss. Careful, prudent, sagacious, of the highest integrity, completely devoted to the public welfare, Calvin Coolidge was of the modest but rugged type whose virtues cannot be appraised too highly. Charles E. Mitchell, Chairman of the National City Bank of New York: Leaving to the record the laudable accomplishments of his years of public service, Calvin Coolidge as a private citizen has been to the nation a storm anchor in the troublesome seas of the depression through which we are now passing. He has steadied the ship of business and scarcely a citizen but has felt a greater faith in the country because of his being. The nation mourns the passing of a great American. Percy H. Johnston, President of Chemical Bank & Trust Co. of New York: In the untimely death of Mr.Coolidge the country has suffered a great !loss. He was a very constructive force in American life. During times like these especially, we can ill afford the loss of such a great citizen. He stood for the best in all public matters, was a true American and as solid as the granite of the Vermont hills from which he sprang. The entire nation will mourn his loss. George W. Davison, President of Central Hanover Bank & Trust Co., New York: I think it is a great loss to the country. Mr. Coolidge's advice and counsel were always valuable. His loss at any time would have been a misfortune, particularly now. Winthrop W. Aldrich, President Chase National Bank of New York: Mr. Coolidge's passing removes from American political and business life the leader who exemplified the qualities which, in these times, are most needed. He was one of our most respected leaders. His death is a loss -to the Nation and cause for universal mourning. Felix M.Warburg of Kuhn, Loeb & Co.: The death of Mr. Coolidge is a tremendous shock to all of us and his -sudden passing removes from our midst a man whose courage, nobility of Impulse and keen logic have commanded the respect and admiration of all Americans. History will undoubtedly record him as one of our greatest Jan. 7 1933 Presidents. The country can ill-afford his loss in these difficult times when his advice and calm and experienced judgment would have been of such inestimable value. Closing of New York Stock and Other Exchanges To-Day in Tribute to Late President Calvin Coolidge. Out of respect to the memory of former President Calvin Coolidge, who died Jan. 5, exchanges in New York and other cities will remain closed to-day (Jan. 7). In New York City the Stock Exchange, Curb Exchange, Cotton Exchange, National Raw Silk Exchange, Metal Exchange, Cocoa Exchange, the Wool Associates of the Cotton Exchange, the Coffee and Sugar Exchange and the Bank Stock and Unlisted Dealers' Association have voted to close. The Chicago Stock and Curb Exchange will not be open and the Board of Trade will close at 11, an hour earlier than usual. The Minneapolis Stock Exchange and the Philadelphia Stock Exchange will also be closed. The New York Stock Exchange's announcement indicating its intention to close follows: At a special meeting Jan.6 of the Governing Committee of the New York Stock Exchange, the following resolution Was adopted: RESOLVED, That as a mark of respect to the memory of ex-President Calvin Coolidge, the New York Stock Exchange be closed on Saturday, Jan.7 1933, the day of the funeral. The following announcement was made by the New York Cotton Exchange: The Board of Managers of the New York Cotton Exchange voted Jan.6 that the Exchange will be closed Jan. 7 out of respect to the memory of Ex-President Calvin Coolidge. The Board adopted the following resolutions: WHEREAS,the members of the New York Cotton Exchange participate In the universal sorrow over the death of Calvin Coolidge, 30th President of the United States of America, and desire to evidence their profound regret and their deep sympathy for those nearest and dearest to him; BE IT RESOLVED, that the Board of Managers on behalf of the members of the Exchange give voice to their feeling over the loss which we have sustained in the death of a man who was an outstanding example of sterling Americanism, which is a precious heritage to posterity; and BE IT FUTHER RESOLVED,as a mark of respect to his memory,that the Exchange be closed on Saturday. Jan. 7 1933. and further that the flag on the Cotton Exchange building be flown at half-staff for a period of 30 days and that the Secretary of the Exchange be directed to forward to Mrs. Coolidge a copy of these resolutions. President Hoover in Message to Congress Asks $150,000 Appropriation for International Monetary and Economic Conference—Also Seeks $150,000 Appropriation for Arms Conference. On Jan. 3 President Hoover sent a message to Congress asking that legislation be enacted to authorize an appropriation of $150,000 "for the expenses of participation by the United States in an international monetary and economic conference to be held during the year 1933." The President in a further message requested a similar appropriation ($150,000)for continuing the work of the Arms Conference. A White House statement in the matter was issued as follows on Jan. 3: The President has to-day sent to Congress an estimate for an appropriation of $150.000 for continuation of the work of the Arms Conference, and a message recommending an appropriation of $150,000 for expenses of participation of the United States in the International Economic Conference. The purpose of these recommendations is to enable the Arms Conference to be carried forward, together with preparatory work of the Economic Conference, but more particularly to provide President-elect Roosevelt with necessary resources to carry forward these activities. From the "United States Daily" of Jan. 4 we take the following: Representative McReynolds (Dem.), of Chattanooga. Tenn.. Chairman of the House Committee on Foreign Affairs, later introduced a resolution (H. J. Res. 536) to carry out the President's recommendation for participation by the United States in an international monetary and economic conference at London. The resolution authorizes an appropriation of $150.000 for the expenses of participation. Accompanying the President's message Is a report to the President by the Secretary of State, Henry L. Stimson, dated Dec. 27 1932, in which, after an historical resume of the activities of the preparatory committee last October. Secretary Stimson concludes as follows: With regard to the question of silver, I can report that during the exchange of views between the representatives present at the first meeting of the Preparatory Committee of Experts, a general discussion was held on the subject and various aspects of the possible uses of silver with a view to improving present economic conditions were touched upon and it was reed to consider the subject further at a later meeting of the Committee here can be no doubt that a serious effort will be made to cope with the problem of silver as well as with other international problems of finance and economics. Participation Urged I firmly believe that no avenue which may lead toward a solution of the difficulties now confronting nations in the economic field should remain unexplored. In order, therefore, that the opportunity may not be lost of joining with other governments in a common and resolute effort which may have far-reaching consequences. it is felt that this Government should be adequately represented by delegates and advisers in sufficient number for the United States to have a voice in the decisions of each of the major committees of the conference, as well as participation in the necessary work preparatory thereto. Secretary Stimson in presenting this statement to the President said that seven governments, Belgium, France, Germany, Great Britain, Italy. Japan and the United States participated in a preparatory committee meeting at Geneva on Oct. 31, with six other countries designated oy the organizing committee and two more designated by the Bank for International Settlements and that "it is expected that there will be added at Its next meeting a member from the great silver using country, China." T Financial Chronicle Volume 136 President Hoover Declares As "Backward Step" Move of Democratic Leaders to Block Reorganization of Government Departments. Opposition on the part of Democratic leaders of Congress to block the plans of President Hoover for the consolidation and regrouping of the Government departments was declared by the President on Jan. 3 to be a "backward step." The President's statement in the matter was issued at Washington, on Jan. 3 (following his return from his holiday in Florida), at his first conference with newspaper men since Sept. 13. Washington Associated Press advices, Jan. 3, said: Regardless of the Presidential statement, House Democratic leaders proceeded with plans to halt the Hoover regrouping proposals. Chairman Cochran said the Expenditures Committee would meet Thursday morning in closed session to act on his resolution which would atop the entire program and leave the job of reorganization in the hands of President-elect Roosevelt. In his statement the President says: The proposal to transfer the job of reorganization to my successor is simply a device by which it is hoped that these proposals can be defeated. Statements that I have made over 10 years as to the opposition which has always thwarted reorganization have come true. The President further says: Either Congress must keep its hands off now or they must give to my successor much larger powers of independent action than given to any President if there is ever to be reorganization. The President's statement follows in full: The proposals of Democratic leaders in Congress to stop the reorganization of Government functions which I have made is a backward step. The same opposition has now arisen which has defeated every effort at reorganization for 25 years. The Chairman of one House Committee discloses: "Many members of the Administration itself opposed Mr. Hoover's plan," but that he had not called them to testify because "he saw no reason to embarrass them." He could add that outside groups, Congressional Committees and members of Congress fear a reduction of influence in the Administration of these functions. The proposal'to transfer the job of reorganization to my successor is simply a device by which it is hoped that these proposals can be defeated. Statements that I have made over 10 years as to the opposition which always has thwarted reorganization have come true. Five years ago I said: "IF. . . Practically every single item in such a program invariably has met with opposition of some vested official or it has disturbed some vested habit and offended some organized minority. It has aroused the paid propagandists. All these vested officials, vested habits organized propaganda groups, are in favor of every ttemtof reorganization except that which affects the bureau or activity in which they are specially interested. No proposed change is so unimportant that it is not bitterly opposed by some one. In the aggregate these directors of vested habits surround Congress with a confusing fog of opposition. Meantime the inchoate voice of the public gets nowhere but to swear at 'bureaucracy'." Any real reorganization sensibly carried out will sooner or later embrace the very orders I have issued. For instance, the consolidation of all agencies Into one co-ordinated public works function has been recommended by every study of the subject all these years. Every other advanced government on earth has a definite public works department or division. No private business and no other government would tolerate the division of its construction work into over 20 authorities in 12 different departments and establishments, as is the case of our Government. It is only by consolidation that duplication and waste of a' multitude of offices and officials can be eliminated. It is the only way that the public can know what is going on in this branch of government. They can only be brought under the limelight if they are concentrated in one place. It is the only way to further reduce logrolling and personal politics in these appropriations. The opposition to placing rivers and harbors work and a lot of independent activities into such a consolidation has been constant for years. The excuse that the services of the Army engineers in the direction of such work will be sacrificed is untrue under the plan I have instituted. No other government and no good government would tolerate merchant marine activities separated over seven departments or independent establishments. The same can be said as to public health, education, land utilization, &c. Altogether I have directed that 58 boards, commissions and bureaus should be consolidated into nine divisions. There are still others to be consolidated. Many regulatory functions now in the departments should be transferred to the Federal Trade and other regulating commissions. The financial and economic functions relating to agriculture should be consolidated. The major departments should be changed. Either Congress must keep its hands off now or they must give to my successor much larger powers of independent action than given to any President if there is ever to be reorganization. And that authority to be effective should be free of the limitations in the law passed last year which gives Congress the veto power, which prevents the abolition of functions, which prevents the rearrangement of major departments. Otherwise it will, as is now being demonstrated in the present law, again be merely make believe. Majority and Minority Reports on Farm Allotment Bill. The following are the texts of the House Agriculture Committee's report on the "parity plan" farm relief bill [we quote from the New York "Times"], as submitted to the House by Chairman Jones, and of a minority report submitted by Representatives Andresen and Clarke, with additional signatures of Representatives Nelson, Beam, Purnell, H. J. Pratt, Adkins and Snow: Majority Report. To accompany H. R. 13991.1 The Committee on Agriculture, to whom was referred the bill (H. R. 13991) to aid agriculture and relieve the existing national economic emergency, having considered the same, report thereon with the recommendation that it do pass. 63 From Dec. 14 to 20 last the Committee held extensive hearings, printed under the title "Agricultural Adjustment Program." It is not believed that the present desperate condition of agriculture need be discussed in this report. The matter is of common knowledge and has been fully covered in hearings and reports of the Conttntatetillurhss the past decade. The hearings referred to above, however, do emphasize the relation of the present situation of agriculture to the general economic depression and develop, in much fuller detail than can be set forth in this report, the fact that this legislation is not a measure solely for the relief of agricultural but is a bill intended to assist in meeting the present national economic emergency in industry, employment, transportation and finance as well. Discriminations Against Farmers. No discussion is necessary to establish the fact that there exists in this country a condition of economic maladjustment and that this condition is in substantial measure attributable to the dlscriminationtiefrosa which agriculture has suffered for many years past Prices for all farm products average to-day about half what they were before the World War. Since the pre-war period wheat has suffered a loss of approximately 65% of its purchasing power, cotton 53% of its purchasing power, tobacco 19% of its purchasing power, and hogs 59% of their purchasing power. On the other hand, taxes on agricultural lands have since the pre-war period increased approximately 150% and farm Indebtedness has increased approximately a like percentage. Agricultural freight rates are more than 50% in excess of pre-war freight rates. We produce surpluses of cotton, wheat and a number of other major farm commodities. No direct tariff can place such commodities on a basis of equality with industrial products that for many years have had the benefit of tariff protection. Agricultural tariffs have almost without exception proved ineffective. Yet tariff rates on industrial articles which the farmer buys, and the cost of such articles to him, have greatly advanced. The result has been that the producers of agricultural commodities must bear the burden of the tariff without receiving its advantages. While the average price of farm products has decreased 46% since the war, the price of industrial articles bought by the farmer has increased as much as 58% during the post-war period, and even during the present year ranged from 106 to 117)4% of pre-war prices. Thus the farmer's dollar has less than half its pre-war value. Because of these various disparities, the farmer's purchasing power for clothing,lumber, hardware, machinery and the like is less than half normal. Lack of agricultural purchasing power is responsible directly and indirectly for more than 8,000,000 of the unemployed, according to expert testimony before the Committee. (See hearings, p. 360-361.) It is not claimed that the farmer's situation is any more desperate than that of the unemployed in the city, save for the fact that discriminations against the farmer have been continuous through the past two decades, while the depression as to industry and labor, in general, has prevailed for only the past three years. If is believed, however, that the elimination of the price disparity between agriculture and industry and the bringing about of a Dotter balance in national purchasing power will greatly reduce the number of unemployed, will aid in re-establishing the purchasing power of labor and other consumers, as well as of agriculture, and will be an effective measure toward meeting the present national emergency. Would Aid Farm Buying Power. The present measure is aimed at restoring agricultural purchasing power by affording to producers of three major agricultural commodities—wheat, cotton, and tobacco—benefits which will give those commodities a purchasing power equivalent to their pre-war purchasing power. As to producers of hogs, graduated benefits are accorded which it is expected will at their maximum result in the restoration of substantially the full pre-war purchasing value of hogs. The bill is drawn to give direct benefits only to the basic exportable agricultural products—namely, wheat, cotton, tobacco and hogs. Many other agricultural products which are not on an export basis are suffering severely from the depression, but the evidence indicates that these will benefit from the action of this bill, even though they were included and subjected to production control. For example.if consumeripay more for pork they will turn in part to beef. Iamb and poultry and thus the price of all meats will be helped. Also, if hog producers are getting a more satisfactory price they will not push into the dairy business at the same rapid rate as they have been for the past four years. Higher wheat prices will help corn, oats, rye, barley and, in fact, all grain prices. It has become clear that the situation in agriculture is now so serious that we can no longer rely solely on normal economic curative reactions. The past policy of letting the agricultural situation continue to drift may in another year result in destroying an agricultural civilization in this country which it would take a generation to rebuild. While the principle that agriculture is entitled to a purchasing power equivalent to that of industry should be a permanent part of our national policy, the present legislation is proposed as a temporary means for effectuating that principle and is by the bill placed into effect only as to the crops produced in 1933. The operation of the provisions of the bill may, by proclamation of the President,be extended for an additional year with respect to any commodity. Whether the continuance of the measure beyond such time will be necessary to placing agriculture on a parity with industry is left to the subsequent determination of Congress. The bill is not the sole remedy needed for the present agricultural situation. It alone would not remove all the discriminations from which agriculture suffers. Further legislation is necessary with reference to such matters as the farm mortgage and rural credits situation, unduly burdensome taxation upon farm lands, readjustment of our currency system in such a way as to make our unit of money more truly a measure of existing values, removal of tariff and freight rate discriminations against the farmer, and restoration of the export market for agriculture through reciprocal arrangements and other measures. Meeting Changed World Situation. For many years we have planted to crops 60,000,000 acres in excess of our own needs. The greater part of the market for this excess 60.000,000 acres has been in Europe, Before the World War the outside world purchased our exportable surplus with the greatest ease because the United States was a debtor nation, and the foreign countries could use the $200.000,000 which we owed the outside world to purchase our exportable surplus. Since the war, the United States has been a creditor nation to the extent of more than $500,000,000 in interest charges annually. The tremendous significance of the creditor position of the United States relative to the national agricultural policy has been too slowly realized. The United States, in its production policies, has acted as though we were a pioneer debtor nation, while the force of world c.rcumstances demands that we act as a mature creditor nation in formulating production policies. Europe has recognized the necessity of making readjustments in her agriculture to the changed world situation more promptly than we. Charts prepared by the Bureau of Agricultural Etonomics and introduced in the 64 Financial Chronicle hearings indicate that the hog production of Denmark and Germany has nearly trebled in the last 10 years. and that this Increase has been accompanied by a corresponding decrease in the American exports of pork products. Many of the countries of western Europe have placed high tariffs on farm products, especially on wheat. Many of these tariffs are above a dollar a bushel and the result has been to reduce very greatly American exports of wheat. Of our 1932 wheat crop, we have thus far been exporting at less than one-fourth of our normal rate. The decline in our agricultural exports is due not only to the creditor position of the United States and nationalistic tariffs at home and abroad but also to depreciated foreign currencies and to the fear which American Investors now have of loaning money to foreign customers. In many countries there are exchange quotas by means of which foreign nations can definitely and positively restrict their importations of American products. In others there are tonnage quotas. It is not fair to agriculture or to the nation to allow the present disordered condition to continue. The forces at work are altogether beyond the control of the individual farmer. Agriculture has been unable to use effectively such methods of control as the tariff and the corporate form of organization. Six million individualistic farmers, each striving to raise enough money to pay his interest and taxes and support his family, without any concern whatever for the national and international situation.can easily, under ordinary economic conditions, add to the confusion and sufferfng during the next few years by increasing the lack of balance between agriculture and industry and between this country and other nations. Difficult to Curtail Output. One of the most difficult parts of our national life to bring into balance Is agriculture. Higher prices for one agricultural product and lower prices for another will bring about rapid shifts in production of the two products Involved, but lower prices for all agricultural products, as has been true since the World War, reduces total agricultural production very slowly. The best evidence indicates that it may take 10. 15 or even 20 years before low prices bring about a really effective curtailment of total agricultural output. Obviously, one of the leading problems of modern civilization is to work out agricultural policies which will make it possible to adjust agriculture more promptly to changing world conditions. In modern industrial society, with its corporate controls, its tariff devices, its union wage scales, Its immigration laws, and the like, it is obvious that agriculture must be given some corresponding power to bring its production more nearly in line with general economic conditions. In order to permit the adjustment of American agriculture to the changed world situation and to restore the proper balance in agricultural production, the bill provides that as a condition to receiving the price benefits for wheat, cotton, tobacco and hogs producers shall for the year 1933 reduce their acreage of wheat, cotton and tobacco 20% and their hog tonnage 20%. In addition, hog producers are required to reduce their corn acreage 20%. In case the measure is extended for an additional year, the matter of reduction of acreage or tonnage is left to the discretion of the Secretary of Agriculture, having in view the necessity for maintaining reduced production only to the extent necessary to prevent the accumulation of abnormal surpluses. The Secretary of Agriculture is thus placed in a position so that he can require the requisite control of production in the light of the then existing state of the export markets,the demands of domestic consumers, the effects of previous reduction in acreage and tonnage and the like. It is not intended that the production of the commodities named should be reduced to a purely domestic basis, but that reduction should be had until the abnormal surpluses that have accumulated during these unusual times shall have become absorbed or reduced to a normal amount. In connection with acreage reduction it is required that land representing reductions shall not be utilized for the production of any commodity of which, in the opinion of the Secretary of Agriculture, there is normally produced or is likely to be produced, an exportable surplus. This provision Isiintended to give protection against overproduction of dairy products and certain other commodities not covered by the bill. Adjustment Certificates. In order to afford the producers of wheat, cotton, tobacco and hogs a pre-war purchasing power for their commodities, provision is made for the issuance of adjustment certificates to those producers upon the marketing of their commodities. These certificates will be in a face amount equal to the difference between the price being paid producers at local markets and the pre-war or fair exchange value of the commodity, less a small deduction to take care of administrative costs, except that somewhat smeller benefits will be paid as to hogs, at least initially. Certificates will, however, cover only so much of the commodity marketed as it is established and proclaimed by the Secretary of Agriculture will be required for domestic consumption. In other words, any exportable surplus produced will not be entitled to benefits under the Act. The American farmer will, however, be given benefits in the domestic market that will place him on a parity with Industry with respect to the exchange values of the commodities produced. The certificates will be issued to the producer by local representatives of the Department of Agriculture upon satisfactory proof that the claimed amount of the commodity has been marketed and that there has been an appropriate reduction in acreage or tonnage. The certificates are negotiable and are issued in two parts one redeemable within 30 days of Issuance and the other six months thereafter Certificates will be accepted for redemption at the United States Treasury or other fiscal agencies designated by the Secretary of the Treasury. The pre-war purchasing power or fair exchange value of the commodity will be determined and proclaimed by the Secretary of Agriculture in accordance with index figures which he now maintains and publishes from time to time. Costs Under the Bill. An important feature of the measure is that it is self-supporting. Amounts sufficient to pay the benefits to producers provided for in the bill are to be realized from the adjustment charges to be paid on the processing of the commodities covered, and the cost of administration is taken care of by reducing by 2;e % the benefits which would otherwise be payable to producers. While the benefits granted are so fixed as to correspond substantially with the adjustment charges to be paid, an additional assurance that the measure will be self-supporting arises from the fact that the adjustment charge as to any commodity will be in effect for one month after the termination of the period for which benfits are granted, whether the Act is in effect as to the commodity for one year or two years. The adjustment charge to be collected on processing is to be in an amount equal to the difference between the prize paid producers at local markets and the pre-war or fair exchange value of the commodity; except that for hogs the adjustment charge is to begin at a lower rate and will be increased gradually as the index number for factory employment, as published by Jan. 7 1933 the Federal Reserve Board, indicates ncreased purchasing power of con'MMUS. Adjustment charges are to be paid in respect of processing of imported quantities of the commodities, as well as those of domestic production. Exemption from the payment of processing charges is provided for in the case of processing by a producer for family consumption, and in the case of a producer of hogs who processes for sale quantities of a value not in excess of $250 during any year for which charges are payable. Incidental Revenue Provisions. By reason of the provisions for adjustment charges it was found desirable to include incidental provisions providing for— (1) An adjustment charge on the processing of silk or rayon. (2) A floor stock tax upon articles processed from wheat, cotton, silk, rayon, tobacco and hogs and held for sale at the time the adjustment charge goes into effect or is Increased. This provision is to prevent stimulation of processing for the purpose of avoiding payment of adjustment charges, and of preventing discriminations between processors. Refund's of the tax are provided in the case of termination or decrease in the adjustment charge. This tax will not apply to persons engaged solely in retail trade, except that a retailer is to be taxed on flour in excess of 100 barrels held for sale. (3) Processing in bond for exportation, without the payment of adjustment charges; and the refund of adjustment charges paid in respect of products exported. (4) Payment by the vendee of the adjustment charges and taxes in cases where existing contracts covering articles in respect of which such charges or taxes are imposed do not permit the addition to the amount to be paid under the contract of the charge or tax. (5) The abatement or refund of adjustment charges In respect of any amount of a commodity used in the manufacture of products which are of such low value that the Imposition of the adjustment charge would prevent the use of the commodity in the manufacture of such products. (6) An import duty of 5 cents per pound in the case of importation of short staple cotton and of jute, these commodities now being subject to no Import duty; an import duty in the ease of articles containing short staple cotton and jute; and import duties on articles processed or manufactured from any commodity which, if domesticady processed, would be subject to an adjustment charge. Protection for Consumers. The measure gives protection to the interests of the consumer. The adjustment charge levied on the processor and to be based on to the consumer is in no ease to represent more than the difference between the prevailing local market prize and the pre-war or fair exchange value of the commodity. This means that the measure cannot be used by the agricultural interests to force consumers to pay a higher percentage of their income to farmers than was the case before the war. This limitation is a protection to agriculture as well as to the consumers, because all thoughtful men realize the large part which unduly high prizes have had in bringing about the breakdown of selfishly conceived foreign production control schemes. Evidence introduced before the Committee indicates that the retail prices of products concerned need not be greatly advanced by the imposition of the adjustment charges. With wheat prices as they are this winter there is only about a half cent's worth of wheat in a 16 ounce loaf loaf and the imposition of the maximum tax on wheat should at most Increase the price of such a loaf by less than a cent. Since 1929 the price of bread in the United States has declined by only 25%, whereas the price of wheat has declined by 68%• It is not generally understood how much the price of wheat could advance without greatly increasing the cost of bread to the consumer. In 1913 bread prices were about the same as now, but wheat was more than twice as high. In like manner, in case of hog products, it will interest the consumer to note that the price of live hogs to-day Is 4 cents a pound lower than In 1913, but the price of ham is actually higher by 7 cents a pound. Pork chops are also slightly higher Lard and sliced bacon are lower, but the percentage of decline is not nearly as great as in the case of live hogs. In the case of cotton and cotton goods, consumers will be interested to learn what a small percentage of the retail price is represented by what the farmer gets. For example, doubling the present price of cotton would increase the price of voile, which now sells for 7 cents a yard, by half a cent, and the price of a cotton shirt which now sells for a dollar, by 2 cents. The various adjustment charges will undoubtedly cost the consumer money, but this money will promptly be spent by the farmer in ways which will decrease unemployment and add to the profits of business. Moreover, consumers must remember that in the long run they cannot expect to buy any product at a price which represents less than a fair return to leper and capital. The ultimate danger to the consumer in present extremely low prices is that some years hence after agriculture is ruined it be necessary to pay unduly high prices before agriculture can be rehabilitated. The consumer as well as the farmer and the business man has everything to gain from a fair and balanced relationship between our productive forces. Minority Report. Every member of the Committee on Agriculture is in thorough accord with the objectives of H.R.13991. For the past 10 years the Committee has sought to bring about the enactment of legislation which attempted to place agriculture on a parity with industry. The farm leaders of the United States have recommended various types of farm relief organization and the majority of the memoers of the Committee have concurred in these suggestions and numerous laws have been enacted as a result thereof by Congress. The undersigned members'of the Committee on Agriculture are of the firm conviction that the objectives sought by the proponents of this legislation, to wit; The restoration of the purchasing power of the farmers cannot be achieved by the enactment of a bill which Is sectional in character and deals with only four or five agricultural commodities. It is our opinion that the passage of this bill will only serve to retard the enactment of constructive legislation in the aid of agriculture. All farm commodities should be considered in any program so that the benefits, if any, may be distributed to all parts of the country. We believe that HE 13991 is unworkable. Its administration by the Secretary of Agriculture will necessarily create an enormous addition to the governmental personnel in order to properly police producers, processors and retailers in the collection of the tax and in supervising the farmers so that acreage and tonnage may be reduced to meet the require- • ments of this bill, thereby adding to the burdens of an already overtaxed people. Bill Is Held Unworkable. We do not believe that the professors of the five commodities named in the bill—wheat, hogs, tobacco, cotton and rice—will be able in these times to finance and pay the adjustment tax imposed upon the different commodities, and we are of the further opinion that the average consumer is not able to pay the tax. Volume 136 Financial Chronicle It is the theory of the advocates of this bill that the consumers of the country will pay the tax as an addition to the regular retail price of the five commodities. It is our fear that if the consum ers are required to pay the adjustment tax, which is a magnifi ed sales tax, upon the necessities of life, they will discontinue the use and purchase of the taxed articles and resort to substitution. This will be particularly true now, when we have more than 10.000.000 people out of employment. If the consum ers are driven to the use of substitutes, it means that the produce rs of the taxed commodities will be compelled to pay the tax by taking less for such commodities when sold to the processor. It is inevitable that if the consumer is unable or unwilling to pay the tax. it is generally conceded that the processor cannot absorb the tax. then it will be taken out of the farmer. We believe that the imposition of a tax as proposed in the bill, which provides that such tax shall be distributed to a given class of people, is unconstitutional and in violation of Senion 8, paragra ph 1 of the Constitution of the United States. We believe that any plan which has for its purpose the stabilization of the prices on surplus farm products, such as the experim ent recently tried out in wheat, cotton, rubber and coffee, will work to the detriment of the producers of such commodities. The stabilization experiences of the Farm Board Is a striking illustration of the folly of another attempt of this charaater, or the valorization scheme for coffee in Brazil, the rubber adventure of Great Britain and its colonies, as well as the futile efforts of the copper produce rs of the world, have led to disaster on all these commodities. The American people desire legislation now which will: 1. Save their homes. 2. Result in less bureaucracy in Government. 3. Lower taxes. 4. Lower interest rates. House Agricultural Committee Reports Farm Allotment Bill to House—Bill Later Changed at Secre t Session. By a vote of 14 to 8, the House Committee on Agriculture approved on Jan. 3 the domestic allotment farm relief bill and ordered it reported to the House. A dispatch from Washington to the New York "Journal of Comme rce" on Jan. 3 added that a special rule giving the measure ential status would be granted by the Rules Commi preferttee the next day, and the bill be taken up for consideratio n Jan. 5. The dispatch continued: It is expected that it will take the entire remainder of the week to dispose Of the measure. Eight hours of general debate have been decided upon by leaders with no limitation placed upon the number of amendments that might oe offered from the floor. The vote of the Committee taken behind closed doors was not divulged by Chairman Jones of Texas. It was not along strict party lines, however, and it was learned that two Democrats joined with a number of Republicans in registering their opposition. Farm Board Ban Deleted. Although agreed upon tentatively at a meeting yesterday, tne Committee decided to-day to eliminate the provisions proposi ng to owlish the Federal Farm Board and agreed to offer an amendm ent from the floor making tne plan applicable to rice. Mr. Jones said that the Committee felt that the question of abolishing the Farm Board should be decided upon in a separate bill on which nearIng s had been held and after all pertinent facts had been gathered. In its present form tne bill applies to wrest, cotton, tobacco and hogs and seeks to raise the prices of these commodities by requiring processors to pay an adjustment charge sufficie nt to bring the price up to the pre-war level on tnat portion of the crops whicn are consumed domestically. These charges, which are to be paid into a general fund, are to be paid back to growers who have agreed with the Secretary of Agricul ture to reduce their acreage 20%. In order to protect processors of cotton against disadvantages in competition, during any period for which an adjustment charge is in effect with respect to cotton, the plans also levies and collects from the first processor of silk or ray on an adjust ment charge equal to the adjustment charges on cotton. Rayon Not Affected. This does not apply to rayon derived from processed cotton which has previously been subjected to an adjustment charge. Chairman Jones said that the bill "Is intended as an emerge ncy measure. In this way the plan can be tested. Temporarily at least it will tend give a better price to the princip to al products of the farm. "The present plight of the farmer arises from discriminations in laws and trade practices. Here our Iles the the permanent remedy. As a long range trouble and here must be found to simple, time honored principles which program we must have a return have proved themselves worthy, but this will take time and until the general program is worked out a temporary act that will be immediately effective is necessary in the interest s of the entire country. There can be no have 10-cent corn, 5-cent corn and 30 National recovery so long as we -cent wheat." "Under the terms of the measure," Mr. Jones said, "at any time wheat, cotton and tobacco price levels are below the pre-war basis, an adjustment charge is to be listed on the processing of the conurodity sufficient to bring the price up to the pre-war levels on that portion of the commodity which goes into domestic consumption. These premiu ms will be paid to producers who comply with the requirements. The plan is to be put into effect gradually as to hogs. "The measure is to be effecti% e for one year and may by proclamation be continued foe an additional year as to any one or more of euch commodities. It provides that only those producers who voluntarily reduce their acreages shall be beneficiaries of the premiums." The special rule paving the way for consideratio n by the House on Jan. 5 of the allotment farm relief bill was granted on Jan. 4 by the House Rules Committee. From the "Journal of Commerce" Washington account Jan. 4 we quote: Tile measure is to be considered under the general rules of the House, which permits the offerings of an unlimit ed number of amendments but With debate restricted to eight hours. It is also planned to debate the rule for an hour and one half. Said to be supported by President-elect Roosevelt, and drafted by the House Agriculture Committee on consult ation with advisers of the Governor 65 and representatives of the leading farm organizations, adoptio n of the plan by the House is seen likely. What attitude the Senate might take on the measure, nowever,is unknown, altnough it is admitted by its advocates that there is considerable opposition to it in that body, and there is some question waetner it could get out of tne Committee. Steps for Relief. Steps in the direction of affording further relief to the farmers, meanwhile were taken in the House and Senate in resolutions introduced ing a plan for financing farm mortgages through the Reconstruction providFinance Corporation. Sponsored jointly by Senator George and Representative Cox. Democrats of Georgia, the measures propose to make loans direct to the individuals under the following conditions: 1. The Reconstruction Finance Corporation would have to be satisfied that an agreement had been entered into between tue farmer and the person nolding Ms mortgage as security for a loan, whereby the original mortgage indebtedness would be reduced oy at least 50%• 2. The Reconstruction Finance Corporation should be satisfie d that upon a reappraisal of the land covered by such mortgage tne fair value thereof would be found to be at least equal to 50% of the original mortgage indeotedness. Size of Loans. Each loan would be made in amount sufficient to enable the borrower to pay the balance due under any such mortgage upon the basis of the agreed reduction in the original mortgage indebtedness. Each loan would be secured by a duly recorued first mortgage on the lands of the borrower and each such mortgage should contain an agreement providing for repayment of the loan on an amortization plan by means of a fixed number of annual or semi-annual instalments within a period of 20 years. All loans would bear interest at the rate of 4%. If the average interest rate payable on its obligations by the Reconstruction Financ e Corporation during any five-year period happened to be less than that figure the rate assessed against farmer borrowers would be reduced to conform thereto. Any farmer whose lands had been lost through foreclosure would be entitled to the benefits of the Act if the Reconstruction Finance Corporation is satisfied that the lands could be restored to the farmer upon settlement of the balance due. To Widen Reconstruction Finance Corporation Scope. The bill would authorize the Reconstruction Finance Corporation to Increase its borrowing power by 53.000,000,000 and limits the amount the Corporation may loan to S1,000,000,000 annuall y. According to Washington advices Jan.5 to the same paper, last-minute changes in the farm allotment program of Democratic leaders were decided upon at a secret meeti ng of the Agriculture Committee on Jan. 5, as debate on the plan got under way in the House only to be cut short with the news of the death of former President Coolidge. These advices (Jan. 5) went on to say: The changes agreed to last night and formally accepted by the Committee to-day seeks to make the plan applicable to the present crop and proposes specific prices as the "fair exchange value" which the growers of wheat. cotton and nogs are to receive. On wheat a price of 75e. a bushel is guaranteed; cotton,9c.a pound, and hogs Sc. a pound; these values to go into effect thirty until the opening of the 193344 season. It is proposedays after enactment d to offer the changes as Committee amendments when the plan is read for amendment, probably next week. Terms of Act. After the opening of the 1933-34 marketing year, the value of hogs is specified at Sc. a pound, plus an additional half-cent for eaca ten points in• crease that occurs in the index number for factory employment over the index as of the date of approval of the bill. Tnereafter the value of hogs, as well as wheat and cotton, will be computed under the previously announced plan—the ratio between the prices paid for hogs in 1909-14 and prices or other commodities. As explained by Representative Nelson (Dem.,Mo.), member ot the Committee, tne fair excnange value on wneat as provided would mean that the farmer would receive a certificate on toe proportion of his crop used in domestic consumption, in an amount equal to the differe nce between the local market price or the price on the farm and 75c. a bushel. For instance, he said, if tne farmer received 35c. a busnel for his wheat on the farm he would be given a certificate for 40c.,less administrative expenses,for every bushel of his crop that goes into domestic consumption. Pou Defends Measure. Debate on tne bill opened with support voiced for the measure by Representative Pou (Dem., N. C.), Chairman of the House Rules Committee, who declared that while the plan is drastic in its nature, agriculture has not only reached a crisis but is almost dead, and "unless new life is injected into the industry return to prosperity is still far distant." Leading the attack on the plan, Representative Purnell (Rep., Ind.), ranking member of the Rules Committee, and a member of the Agriculture Committee, characterized the program aa a "magnif ied, glorified sales tax— a sales tax on the necessities of life." Turning to the Democrats, he declared, "how would they support tne bill in view of tneir action last session waen they defeate d the manufacturers' excise tax even though it excluded tae necessities of life? "1 know of notaing Congress can do to more complet ely destroy agriculture than to pass tnis measure," he said. "It has been hastily prepared and ill considered by the Committee of Agriculture. Hits Bill as Useless. "It is nothing more than a newly created bootstr ap with which the farmer Is expected to lift himself out of the mire in whicn we all know him to be." Mr.Purnell also denied that the farm organizations were behind the measure. Speaking in behalf of the textile industries of New Englan d, Representative Martin (Rep., Mass.) warned tnat tne tax on cotton will be aoout $30 a bale and will mean an assessment on textile manufacturers of $20,000,000. "No textile manufacturer. Nortn or South, could absorb the tax." he said. "If you are to put tne price of cotton goods artifici ally high, you direct buying into other goods. The result would be less consumption in the end. The farmer would not profit, but the textile busines s would be seriously injured." Text of House Agricultural Committee Farm Allot ment Bill As Reported to House. The following is the text of the House Agricultural Committee's farm allotment bill as reported to the House on Jan. 3, and published in the New York "Times": Financial Chronicle 66 A BILL. To aid agriculture and relieve the existing National economic emergency Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "National Emergency Agricultural Act." Declaration of Policy. Sec. 2. It is hereby declared; (a) That the depression in prices for that portion of our agricultural commodities for domestic consumption, and the effect of unsettled world comconditions upon foreign markets for that portion of our agricultural the prices modities for consumption abroad, and the inequalities between infor agricultural and other commodities, have given rise in the basic transactions in dustry of agriculture to conditions that have affected buragricultural commodities with a National public interest, that have dened and obstructed the normal currents of commerce in such commodities, relief the in aiding for Act this of and that render imperative the enactment of the present National economic emergency in agriculture and thereby and facilitating the recovery of industry, transportation, employment finance. planning agricultural (b) That it is the policy of Congress to encourage in restoring and readjustment to meet changed world conditions and to aid the parity between agriculture and other industries and in correcting the Inequalities between the prices for agricultural and other commodities. (c) That the provisions of this Act are made applicable solely with the respect to wheat, cotton, tobacco and hogs by reason of the fact that prices for these basic commodities are a controlling factor in establishing surprices for other domestic agricultural commodities, that exportable pluses of these commodities or products thereof are ordinarily produced factor controlling a markets world on in such quantities as to make prices proin establishing domestic prices and that substantially the entire duction of these commodities is processed prior to ultimate consumption. Distribution of Commodity Benefits. Adjustment Certificates. normal marSec. 3. (a) The Secretary of Agriculture shall determine the tobacco keting year for each of the following commodities; Wheat,cotton, Title I. and hogs. of wheat, cotton and (b) Adjustment certificates shall be issued in case the commodity and, in tobacco for the 1933-1934 marketing yea* for for hogs (specified in Sec. 4) case of hogs, for the initial marketing period and the 1933-1934 marketing year. for an additional If this Act is extended with respect to any commodity under Sec. 28, then adyear pursuant to proclamation of the President for justment certificates shall be issued for the 1934-1935 marketing year the commodity. hogs shall ho entitled, (c) Each producer of wheat, cotton, tobacco or subject to the conditions of this Act, to have issued to him adjustment certificates coveting the domestic consumption percentage of the comperiod for which modity of his own production marketed by him during any adjustment certificates may be issued with respect to the commodity; in the discretion Provided. That as to cotton, adjustment certificates may. ginned or of the Secretary, be issued to the producer when the cotton is the unginned cotton sold. be to be shall deemed commodity a title (d) For the purposes of this him marketed by a producer when sold or otherwise disposed of by or for to be marketed for processing or resale, but hogs shall not be deemed who is not also a when sold or otherwise disposed of to a feeder of hogs processor of hogs Percentage. Consumption Domestic Section 4 (a) The Secretary of Agrucilture; cotton and tobacco, shall, at least two weeks prior wheat, (1) In case of which this to the commencement of each marketing year with respect to and title is in effect for the commodity, estimate, as nearly as practicable, the of commodity production proclaim the percentage of the total domestic for needed and be marketed will that year calendar during the then current domestic consumption. days after the date of approval (2) In the case of hogs, shall, within 30 proclaim the percentage of this act, estimate, as nearly as practicable, and initial marketing period for the during marketed of domestic hogs to be hogs that will be needed for domestic consumption. For the purposes of this title the initial marketing perold for hogs shall approval of this act and be the period commencing 30 days after the date of hogs. terminating at the commencement of the 1933-1934 marketing year for (3) In case of hogs shall, at least two weeks prior to the commencement for hogs, of each marketing year with respect to which this title is in effect subsequent to the initial marketing period for hogs, estimate, as nearly as be to marketed hogs practicable, and proclaim the percentage of domestic during such year that will be needed for domestic consumption. any period shall be based on (b) Any such percentage proclaimed for as statistics of the Department of Agriculture and other Federal agencies commodity for the five preto the average domestic consumption of the ceding periods of like duration. Face Value of Certificates. any comSec. 5. The face value of any adjustment certificate per unit of per modity covered thereby shall be equal to the fair exchange allowance commodity at the like unit of the commodity in effect with respect to such expenses as time of its marketing, less a pro rata share of administrative in case of hogs estimated by the Secretary of Agriculture; except that value of the marketed during the initial marketing period for hogs, the face certificate shall be 1 cent per pound of hogs covered thereby. Issuance of Certificates. employees Sec. 6. The Secretary of Agriculture shall designate officers, with the approval of the or agents of the Department of Agriculture (or with President, of any other department or independent establishment; or of any State or political the approval of the appropriate State authority, subdivision thereof) for the issuance of adjustment certificates. the producer and proof Such certificates shll oe issued upon application by satisfactory to the Secretary that the producer is entitled thereto pursuant thereunder. to this act and the regulations Redemption of Adjustment Certificates. sec. 7, (a) Each adjustment certificate shall be issued in two parts, of the certificate. Title to either each to be at one-half the face value by delivery. part of an adjustment certificate shallbe transferable presented by the bearer One part of an adjustment certificate may be the year commencing one month after for redemption at any time during and the other part may be presented by the the date of issuance thereof, the second six months ofsuch year. during time bearer for redemption at any States TreasCertificates shall be accepted for redemption at the United United States as the Secretary of the ury or at such fiscal agencies of the Treasury shall designate. Jan. 7 1933 (b) The action of any officer, employee or agent in issuing and fixing the value of any adjustment certificate and in redeeming such certificate shall not be subject to review by any court or by any officer of the Government other than the Secretary of Agriculture. Acreage Control. Sec. 8.—(a) Nothing in this act shall be construed as affecting or controlling in any way the freedom of any producer to produce and sell as much as he wishes of any commodity; except that the issuance of adjustment certificates shall be subject to the following conditions and limitations: (1) No adjustment certificates shall be issued in respect of wheat cotton or tobacco of any producer marketed during the 1933-1934 marketing year for the commodity, unless the producer's acreage of wheat,cotton or tobacco of 1933 production is 20% less than his average acreage for such preceding period as the Secretary deems representative of normal production conditions in the area; but this paragraph shall not apply to acreage planted to wheat in the fall of 1932. (2) No adjustment certificate shall be issued in respect of any lot of hogs of any producer marketed during the initial marketing period for hogs unless the producer's tonnage of hogs for market during such period is or will be 20% less than his average tonnage for the same period during such preceding year or years as the Secretary of Agriculture deems representative of normal hog production conditions in the area. (3) No adjustment certificates shall be issued in respect of hogs of any producer marketed during the 1933-1934 marketing year for hogs, unless the producer's tonnage of hogs for market during such year is or will be 20% less than his average tonnage for such preceding period as the Secretary of Agriculture deems representative of normal hog production conditions in the area, nor unless his acreage of corn, If any, of 1933 production is 20% less than his average acreage for such preceding period as the Secretary deems representative of normal production conditions in the area. (4) In the event that this act is, by proclamation of the President made pursuant to Section 28, extended for an additional year with respect to wheat, cotton, tobacco or hogs, no adjustment certificate shall be issued to any producer in respect of such commodity marketed by him during the 1934-1935 marketing year for the commodity, unless the producer's acreage, in case of wheat, cotton, or tobacco, or in case of hogs, his acreage of corn, if any, and his tonnage of hogs, has been reduced in such amount as the Secretary of Agriculture has found necessary in order to prevent abnormal surpluses or carry-overs in the commodity. (5) No adjustment certificates shall be issued in respect of wheat, cotton or tobacco in any case where reduction of acreage is required by this act, if the land representing such reduction is utilized, during the year in respect of which such reduction occurs, for the production of any commodity of which, in the opinion of the Secretary, there is normally produced or is likely to be produced an exportable surplus. It shall be the duty of the Secretary of Agriculture to determine and make public the commodities that may be prodwed in various regions upon land representing acreage reductions under this act without violating the requirements of this paragraph. (b) The Secretary of Agriculture shall by regulation provide for the application of the provisions of this section with respect to producers not engaged in the production of the commodity prior to the particular year, with respect to crop rotation, and with respect to changes in the amount of acreage under cultivation by the producer. Fair Exchange Allowance. Sec. 9.—(a) The fair exchange allowance for any commodity shall be the difference between the price received for the commodity by producers at local markets and the fair exchange value for the commodity, as hereinafter determined. (b) The fair exchange allowance per unit for each commodity shall be proclaimed by the Secretary of Agriculture on the day following the date of approval of this act. Thereafter the fair exchange allowance shall be proclaimed at such intervals as the Secretary may from time to time deens necessary to keep in effect a fair exchange allowance which, together with the price received for the commodity by producers at local markets during the last three months for which index numbers are available, will substantially equal the fair exchange value for the commodity. (c) The fair exchange allowance shall be determined by the Secretary ors the basis of the index numbers for prices as computed and published by the Department of Agriculture. (d) The fair exchange allowance specified in the first proclamation for any commodity made by the Secretary under this act shall take effect on the day following the date of approval of this act. The fair exchange allowance specified in any subsequent proclamation for the commodity shall take effect at such date as is specified in the proclamation. (e) Except as provided for hogs under subsection (f), the fair exchange value for any commodity shall be an amount that shall bear to the price for all commodities bought by producers during the last three months' period for which index numbers are available, the same ratio as the price for the commodity paid producers at local markets during the base period bore to prices for all commodities bought by producers during such base period. The base period shall be the period commencing September 1909, and terminating August 1914. (f) During the following periods the fair exchange value in case of hogs shall be as follows: (1) For the period commencing the day following the date of approval of this act and terminating April 30 1933,3% cents a pound. (2) For the period commencing May 1 1933. and terminating June 30 1933, 4 cents a pound. (3) For the period commencing July 11933. and terminating at the beginning of the 1933-1934 marketing year, 434 cents a pound. hogs, 5 cents a (4) Beginning with the 1933-1934 marketing year for pound plus an additional 34-cent a pound for each 10 points increase that the index number over employment for factory exists in the index number therefor on the date of approval of this act, as published by the Federal Reserve Board, until such time as the fair exchange value of hogs so computed first equals such value as computed under subsection (e). (5) Thereafter the fair exchange value for begs shall be computed under subsection (e). Title II—Adjustment Charges. Payment of Adjustment Charges. Sec. 10. (a) There shall be levied, assessed and collected an adjustment charge on the first domestic processing of any wheat, cotton, tobacco or hogs, whether of domestic production or imported to be paid, by the processor. Adjustment charges shall at any given time be at the same rate per unit of the commodity as the fair exchange allowance then in effect with respect to the commodity. Adjustment charges shall commence on the day following the date of approval of this act and shall terminate with respect to any commodity comone month after the end of the 1933-1934 marketing year for the modity; except that if this act is extended with respect to any commodity for an additional year, pursuant to proclamation of the Secretary of Agri- Volume 136 Financial Chronicle culture under Sec. 28, then adjustment chagres with respect to the commodity shall terminate one month after the end of the 1934-1935 marketing year for the commodity. (b) Each processor required to pay any adjustment charge imposed by this section shall procure and keep posted a certificate of registry in accordance with regulations prescribed by the Secretary of the Treasury. Any processor who fails to register or to keep posted any certificate of registry In accordance with such regulations shall, upon conviction thereof, be subject to a fine of not more than $1.000. (c) In order to protect the processors of cotton against disadvantages In competition, during any period for which an adjustment charge Is in effect with respect to cotton, there shall be levied, assessed, and collected upon the first domestic processing of silk or rayon an adjustment charge equal to the adjustment charge then in effect as to cotton, per like unit of the commodity, to be paid by the processor. No such charge shall be collected with respect,to rayon derived from processed cotton subject to an adjustment charge with respect to its processing. Floor Stocks, Sec. 11.—(a) Upon the sale or other disposition of any article processed wholly or in chief value from wheat, cotton, silk, rayon, tobacco or hogs that (on the date any adjustment charge, or increase or decrease therein, takes effect or terminates) is held for sale or other disposition (including articles in transit) by any person other than a consumer or a person engaged solely in retail trade, there shall be made a tax adjustment as follows: (1) In case an adjustment charge takes effect, or is increased, there shall be levied, assessed, and collected a tax to be paid by such person equivalent to the amount of the adjustment charge or increase which would be payable with respect to the commodity from which processed if the processing had occurred on such date. (2) If the adjustment charge is terminated or decreased, there shall be refunded to such person a tax (or if the tax has not been paid, the tax shall be abated) in an amount equivalent to the adjustment charge or decrease with respect to the commodity from which processed. (3) Such equivalent amounts shall be established by conversion factors prescribed by regulations of the Secretary of the Treasury. (b) The proceeds of all taxes collected under this section, less 23,4% for the payment of administrative expenses under this act, shall be covered Into the Treasury into a special fund to be available, together with any other funds hereafter appropriated for the purpose, for the payment of any refunds under this section. (c) For the purpose of this section the term "retail trade" shall not be held to include the business of an establishement which is owned, operated, maintained, or controlled by the same individual, firm, corporation or association that owns, operates, maintains, or controls any other establishment of the same character. (d) Notwithstanding the provisions of sub-section (a) such sub-section shall apply to flour in excess of 100 barrels held for sale or other disposition by any person engaged solely in retail trade. Ezporiations. Sec. 12.—(a) Upon the exportation to any foreign country (including the Philippine Islands, the Virgin Islands, American Samoa. and the Island of Guam) of any product with respect to which an adjustment charge or tax has been paid under this act, the exporter thereof shall be entitled at the time of exportation to a refund of the amount of such charge or tax, as established by conversion factors prescribed by regulations of the Secretary of the Treasury. The Secretary shall prepare forms for filing dahns for such refunds and shall certify to the Treasurer of the United States claims which have been approved for payment. (b) Upon the giving of satisfactory bond for the faithful observance of the provisions of this act requiring the payment of adjustment charges or taxes, and of such regulations as may be prescribed thereunder, any person shall be entitled, without payment of the adjustment charge or tax, to process for such exportation any wheat, cotton, tobacco, or hogs, or to hold for such exportation any article processed wholly or in chief value therefrom. The Secretary of the Treasury shall prescribe necessary regulations for such processing or holding in bond or in such other manner as may be necessary to carry out such provisions. Processing for Personal Use and Limited Sale. Sec. 13. No adjustment charge shall be required to be paid on the processing of any commodity by the producer thereof for consumption by his own family, employees, or household, or on the processing of hogs by the producer thereof, for sale during any year for which such chars,would otheriise be payable, If his sales of the products resulting from such processing of hogs do not exceed $250 during such year. Government Instrumentalities. Sec. 14. No processor or other person shall be exempt from any adjustment charge or tax under this Act by reason of the fact that the products of the processed commodity are purchased by the United States, or any State, territory, or insular possession thereof (except the Philippine Islands, the Virgin Islands, American Samoa, and the Island of Guam), or the District of Columbia, or any agency or instrumentality thereof. Existing Contracts. Sec. 15. (a) If (1) any processor has, prior to the date oi approval of this Act, made a bona fide contract of sale for delivery after such date of any article in respect of which an adjustment charge or tax is imposed under this Act, and if (2)such contract does not permit the addition to the amount to be paid thereunder of the whole of such charge or tax, then (unless the contract prohibits such addition) the Vendee shall pay so much of the charge or tax as is not permitted to be added to the contract price. (b) Charges or taxes payable by the vendee shall be paid to the vendor at the time the sale Is consummated and shall be collected and paid to the United States by the vendor in the same manner as other adjustment charges or taxes under this Act. 04 In case of failure or refusal by the vendee to pay such charges or taxes to the vendor, the vendor shall report the facts to the Commissioner of Internal Revenue, who shall cause collection of such charges or taxes to be made from the vendee. Collection of Adjustment Charges. Sec. 16. (a) The adjustment charges and taxes provided In this Act shall be collected by the Bureau of Internal Revenue under the direction of the Secretary of the Treasury. Such adjustment charges shall be paid Into the Treasury of the United States. (b) All provisions of law, including penalties, applicable with respect to the taxes Imposed by Sec. 600 of the Revenue Act of 1926. and the provisions of Sec. 626 of the Revenue Act of 1932 shall, In so far as applicable and not Inconsistent with the provisions of this Act, be applicable In respect of adjustment charges and taxes imposed by this Act* Provided, That the Secretary of the Treasury is authorized to permit postponement. 67 for a period not exceeding 60 days, of the payment of adjustment charges covered by any return. Low-Value Products. Sec. 17. If the Secretary of the Treasury and the Secretary of Agriculture jointly find that any class of products of any commodity is ofsuch low value compared with the quantity of the commodity used for their manufacture that the imposition of the adjustment charge would prevent in whole or In large part the use of the commodity in the manufacture of such products and thereby substantially reduce consumption and increase the surplus of the commodity, then the Secretary of the Treasury may abate or refund the adjustment charge with respect to such amount of the commodity as is used in the manufacture of such products in accordance with regulations prescribed by the Secretary of the Treasury. Importations. Sec. 18 (a) During any period for which an adjustment charge under this Act is in effect with respect to cotton there shall be levied, assessed, collected and paid upon the following articles when imported from any foreign country into the United States the following duties: 1. On cotton having a staple of less than 1;4 inches in length, and on Jute. 5 cents per pound; and 2. On all dutiable articles wholly or in chief value of cotton having7a staple of less than 114 inches in length, or wholly or in chief value of jute, an additional duty of 5 cents per pound on such cotton,or the jute,contained therein, as established by conversion factors prescribed by regulations of the Secretary of the Treasury. Ml (b) During any period for which an adjustment charge is in effect with respect to wheat, cotton, tobacco, or hogs, there shall be levied, assessed, collected, and paid upon the importation, from any foreign country into the United States of goods processed or manufactured from such commodity which, if domestically processed, would be subject to an adjustment charge a duty equal to the amount of the adjustment charge which would be payable with respect to such domestic processing at the time ofimportation, as established by conversion factors prescribed by regulations of the Secretary of the Treasury. Such duty shall be in addition to any other duty Imposed by law. (c) The duties imposed by this section shall be levied, assessed, collected, and paid in the same manner as duties imposed by the Tariff Act of 1930, and shall be treated, for the purpose of all provisions of law relating to the customs revenue, as duties imposed by such act. (d) As used in this section the term "United States" means the United States and Its possessions, except the Philippine Islands, the Virgin Islands, American Samoa,and the Island of Guam. Title III—General Provisions. Definitions. Sec. 19. As used in this Act; 1. In case of wheat, the term "processing" means the milling or other processing (except cleaning and drying) of wheat for market. 2. In case of cotton, silk, and rayon, the term "processing" means the spinning, manufacturing, or other processing (except ginning) of cotton, silk, or rayon; and the term "cotton" shall not include cotton linters. 3. In case of tobacco, the term "processing" means the manufacturing or other processing (except drying) of tobacco. 4. In case of hogs, the term "processing" means the slaughter of hogs for market. Administrative Expenses. Sec. 20. (a) The Secretary of Agriculture is authorized to expend for the payment of administrative expenses under this Act not to exceed 2)4% of the annual receipts from adjustment charges and taxes under this Act. The Secretary of Agriculture is authorized (subject to the limitations provided in subsection (a) with respect to the amounts available for the payment of administrative expenses) to transfer to the Treasury Department and other agencies of the Federal Government, and to any agency of any State or any political subdivision thereof, such sums as are required to pay the additional expenses incurred by such agencies in the administration of this Act. Regulations. Sec. 21. The Secretary of the Treasury and the Secretary of Agriculture are authorized to prescribe such regulations as may be necessary to the efficient administration of the functions vested in them, respectively, by this act, including regulations by the Secretary of Agriculture as to proof which the Secretary will deem satisfactory as a basis for issuing adjustment certificates. Copies of regulations under this act shall be published and distributed without cost to producers and other interested persons. Classification and Types of Commodities. Sec. 22. Whenever any agricultural commodity has regional or market classifications or types which the Secretary of Agriculture finds are so different from each other in use or marketing methods as at any time to require their treatment as separate commodities under this act the Secretary may determine upon and designate one or more such classifications or types for such treatment. Such classification or type shall, so long as such determination remains in, effect, be treated as a separate commodity under this act in accordance with regulations to be prescribed jointly by the Secretary of Agriculture and the Secretary of the Treasury. Information to Be Made Public. Sec. 23. The Secretary of Agriculture is authorized when any adjustment charge, or increase or decrease therein, takes effect in respect of a commodity, to make public such information as he deems advisable regarding (1) the relationship between the adjustment charge and the price paid to producers of the commodity, (2) the effect of the adjustment charge upon prices to consumers of products of the commodity, (3) the relationship, in previous periods between prices to producers of the commodity and prices to consumers of the products thereof and (4) the situation in foreign countries relating to prices to producers of the commodity and prices to consumers of the products thereof. Personnel. Sec. 24. The Secretary of Agriculture and the Secretary of the Treasury may each appoint such experts and, in accordance with the Classification Act of 1923 and all acts amendatory thereof, and subject to the civil service laws, such officers and employees as are necessary to execute the functions vested in them, respectively, under this act. Penalties. Sec. 25. (a) Any person who makes any false statement for the purpose of fraudulently procuring, or shall attempt in any manner fraudulently to procure, the issuance or redemption of any adjustment certificate. whether for the benefit of such person or any other person, shall upon conviction be fined not more than $2,000 or imprisonment not more than one year, or both. (b) Adjustment certificates issued under authority of this act shall be obligations of the United States within the definition In Section 147 of the 68 Financial Chronicle act entitled "An act to codify, revise and amend the penal laws of the United States," approved March 4 1909 as amended. Authorization of Appropriations. Sec. 26. There are hereby authorized to be appropriated such sums as may be necessary for the purposes of this act. Application of Act. Sec. 27. The provisions of this act, except Sec. 18, shall be applicable to the United States and its possessions, except the Philippine Islands, the Virgin Islands, American Samoa and the island of Guam. Extension of Act. Sec. 28. Prior to the commencement of the planting of wheat, cotton and tobacco, respectively, for production during the calendar year 1934 and prior to the commencement of the period for breeding hogs which normally will be sold during such year, the Secretary of Agriculture shall Investigate and report to the President whether the inequalities between the prices for any such commodity and other commodities have been, or are likely to be, corrected without extending the provisions of this act. If the President determines that it Is necessary to place the provisions of this act in operation in order to correct any such inequality with respect W.:wheat, cotton, tobacco or hogs, he shall thereupon issue a proclamation setting forth such determination. Upon the issuance of any such proclamation with respect to any commodity, the provisions of this act shall be in operation for an additional year with respect to the commodity covered by the proclamation. Views of Horace Bowker on Farm Allotment Plan— Declares It "Most Daring Economic Experiment" Ever Proposed. At a meeting on Dec. 22 of farmers, merchants and bankers at Riverhead, Long Island, Horace Bowker, President of the American Agricultural Chemical Co., expressing his views on the voluntary domestic farm allotment plan now before Congress, declared that "there is no use pretending that this is not the most daring economic experiment ever seriously proposed in the United States." Mr. Bowker in the course of his remarks said: For 10 years, leaders of farm organizations have been advocating pricefixing measures. interest focussing principally upon the Export Debenture Plan and the Equalization Fee. In recent months emphasis has shifted to the Voluntary Domestic Allotment Plan, which now is receiving wide support in farm and political circles. The legislative situation is still in the formative stage, and it is therefore necessary to analyze the principles involved in the various measures under consideration, rather than to attempt an appraisal of specific measures. Respecting the farm allotment plan, Mr. Bowker said: More recent price-fixing measures combine,in a sense,some of the features of the Export Debenture and Equalization Fee Plans, but aim to meet some of the principal objections. There are no fewer than 17 farm relief bills in the Senate and House at the present time. Most of them incorporate the price-fixing principle. Present attention is cencentered on the so-called Volontary Domestic Allotment Plan, the essential principles of which, with due allowance for important differences in practical application, are as follows• The Voluntary Domestic Allotment Plan is designed to increase the domestic price of farm commodities, but an effort is made to control production. Various authorities, closely identified with the incoming Administration, have participated in discussions leading to a definition of specific legislation, and it is to be assumed that the form in which this legislation is taking shape is designed to square with the farm policy set forth in the Democratic platform. "Stated as simply as possible, the Voluntary Domestic Allotment Plan provides for an excise tax on domestic consumption equal to the amount of the tariff on wheat, cotton, hogs, and tobacco, the tax to be collected somewhere in the processing of these products, say, from the miller, textile mill, packer or tobacco manufacturer. "For example,the miller would pay a tax of 42 cents on every bushel of wheat ground into flour and sold in this country; no excise tax is to be levied on wheat or flour exports. With a domestic consumption of 600,000,000 bushels of wheat, the excise tax would provide $252,000,000 on wheat. The tax on other commodities would provide similar funds. The individual farmer enters into an agreement with the government to a specified limitation in acreage, the consideration being his share of the excise fund. Sixty per cent of the farmers must consent to this plan before it can be made operative. A program of education to explain this plan to the farmers, which include 1,300,000 wheat growers alone, would be necessary. "If 60% of the farmers growing each crop consent to the allotment of acreage, the allotment organization,which may include Federal, State and County commissions, would become operative. First the Federal Commission would allot to each State a total acreage based upon census figures for the previous five years. Next, the State Commission would allot a total wheat acreage to each county, on a similar basis. Finally, the County Commission would survey the wheat acreage and divide the county allotment among individual farms or farmers, provision being made for pubic hearings and the publication of allotments. "The individual farmer can accept or reject the allotment which presumably will provide for a specified reduction in acreage. If he rejects the plan, he can of course continue to produce and market his crop as heretofore. By accepting the plan he agrees to reduce his acreage by a percentage, say 20%, to be determined by the Federal Allotment Commission. "If a farmer has grown a 5-year average of 50 acres of wheat, he would agree to reduce his acreage to 40 acres. If his average yield is 15 bishels an acre, his total theoretical output from 40 acres would be 600 bushels and he would receive allotment certificates in that amount,in return for voluntarily agreeing to restrict acreage. "All growers, regardless of wheather they signed the voluntary allotment agreement, would dispose of their crops in the open market, at the open market price. But the farmers who held Allotment Certificates would present them for redemption by the government,from funds collec5ed through the excise tax. "After deducting the expense of administering the plan, estimated at about three cents a bushel, the cash redemption value of the certificates would in theory be 39 cents a bushel. In the case of the 50-acre grower who voluntarily reduced his acreage to 40 acres—yield basis being 15 bushels to the acre. or 600 bushels total—the total cash redemption value of his allotment certificates would be $234. This bonus would be paid regardless of how much or how little wheat he grew; it would be paid even if he harvested no wheat at all. Jan. 7 1933 "The same plan, with necessary adaptations, would apply to cotton, with a tax of five cents a pound, hogs two cents a pound; tobacco four cents a pound." Various modifications of this plan are under discussion. For instance, one measure provides for payment only on that portion of the total production which the Secretary of Agriculture finds to be the probable domestic demand. Other recent suggestions would eliminate the tariff rates as the basis for payment and substitute "pre-war parity of agricultural products with industrial prices" as a base. Under this scheme, processors would pay a tax in whatever amount might be required to establish a pro -war parity between agricultural and industrial products. This plan is predicated upon an immediate 20% reduction in output. Depending upon the number of commodities to be included, the additional farm income is estimated at from $600,000,000 to $1,100,000,000. Some of the proponents of farm relief legislation hold that this would only Increase total farm income to about six billion dollars, assuming no substantial change in farm commodity prices. As a result, there are some who would combine the various excise and bounty plants into one ail-inclusive price-raising measure. While the facts clearly indicate the heavy odds against the farmer, and argue the need for prompt, positive action, even casual examination of the proposed legislation indicates that this is indeed "the most daring economic experiment ever proposed in the United States." It is not too much to say that the future trend of business, not only in this country but measurably throughout the world, may depend upon the soondness with which this situation is handled. It is profoundly important therefore to consider every aspect of this situation. Public opinion must be fully and completely informed, for the public in the final analysis will pay these contemplated excise taxes or bounties, no matter how levied; it will be the gainer if the results of any such legislation should prove to be helpful to general business, or the loser should the result be further derangement of an already-disorganized National and world economy. In part Mr. Bowker continued: Some Fundamental Considerations. The farmer needs help; the nation cannot give it grudgingly, if for no other reason than that general economic recovery largely depends upon agricultural recovery. However, if the probable disadvantages inherent in present plans outweigh the probable advantages,sound judgment dictates the wisdom of adopting other measures. Here are some considerations which must be evaluated in the determination of one of the most important problems of National policy now oefore the country. 1. Is it not visionary to expect, almost over night,that we can "socialize" our most highly individualized industry? American agriculture is the world's largest and most complex industry; it is the most loosely-knit and most highly-individualistic of all industries. Price-raising experiments in other industries have no justifiable parallel in the far-flung and diversified character of our agriculture. Is it not probable, therefore, that in sheer desperation we are contemplating a course of action that normal judgment would characterize as visionary, impractical and unsound? There is no justification for the assumption, for example, that because France,—with one-quarter of our wheat acreage and producing considerably less than her own domestic requirements—has apparently succeeded in holding wheat prices substantially above world levels,jthat the same principle can be applied in this country, with 1.300,000Ifarmers producing 800 million bushels of wheat a year, a substantial surplus of which must be sold in world markets. Those who are sincerely anxious to promote the well being of the American farmer would be only too happy if French and other foreign developments In National control of crop production might have a direct and immediate application to American agriculture. But the situation in this country is so infinitely more complex that there is no sound parallel. There is a strong argument to be made for "planned economy" as compared with laissez-faire—which merely dignifies the intellectually lazy and essentially inhuman philosophy of letting the future solve our problems for us. But it would seem to be jumping off the deep end in using agriculture as a trial-ground for economic experimentation. This is the broad, overall view of contemplated price-fixing legislation: it is apt to be lost sight of in the consideration of detail and method More detailed considerations have to do with the setting up of a huge bur.aucracy to administer and police the program; with the grave uncertainty as to whether the farmer, individualist that he is, will assent to a Federal overlordship of agriculture. The rank and file of farmers may well see in this a high price to pay for such relief as they might ultimately obtain. 2. Are all farmers treated alike in the proposed Legislation? About 55% of the gross income from farm production comes from livestock and livestock products; 45% comes from the various crops. About half of the livestock income, or 26% of the total farm income, is derived from cattle, hogs and sheep; 19% comes from dairy products, and 11% comes from poultry and hens. Grains, including wheat, account for 8% of the total gross farm income; cotton and cotton-seed also provide 8% of the total; tobacco about 23 51. On the other hand, vegetable production is over 10% of the total farm income. The proposed Price-raising Legislation, which includes wheat, cotton, hogs and tobacco, therefore includes crops which account for only about 40% of the nation's farm income. 3. Is it sound economy to disregard production cost in extending farm relief? There is a wide variation in the cost of producing farm crops. For example, some farmers grow cotton at 4 or 5 cents a pound: others at 10 or 15 cents. Production cost depends primarily upon the productivity of the land and the efficiency of the farmer. There is a vast acreage of marginal land under cultivation in this country which is wholly unsuited for growing the present crops. This legislation would extend aid to high-cost and low-cost producer. It would subsidize the efficient and the inefficient alike. Is it sound economy that the public should oe called upon to subsidize the inefficient farmer? 4. Would afurther tax increase offrom a half-billion to 131 billion dollars obstruct recovery in this country? In 1929, when the national income was 85 billion dollars, our total annual tax bill was 14 pillion dollars. Due to procrastination or futility, we are paying 14 billions for taxes in 1932, although our national income has been reduced to 50 billions. If our tax bill were reduced proportionate to the decline in income, the public would have 531 billions of dollars more to spend for farm products and other necessities of life. But tax reduction is no easy matter in a political democracy. And the problem of raising additional revenues to balance the national budget Is by no means solved. It seems probable, therefore, that the further increase in the country's tax burden required to underwrite this type of farm relief, would mean a further depletion of purchasing power and a further postponement of more normal public buying Volume 136 Financial Chronicle 6. Would a wholly untried economic experiment, as typified by proposed price-fixing measures, increase the present uncertain state of the public mind? There is competent authority for the statement that the public has been buying up to only about a third of its present purchasing power. This has been largely due to doubt and uncertainty over the future. There are signs that the public is oeginning to buy more normally. This is the point at which recovery must start, for increased buying means Increased employment, with a resulting increase in total purchasing power, and eventually Increased prices. Mass psychology is a very uncertain quantity; it is easily swayed by fear and douot. When the public came to realize the scope and implications of this unprecedented price-raising experiment, it is not inconceivable that returning confidence might be definitely retarded. 6. Finally, would price-raising legislation, by interposing additional barriers to world trade, obstruct the natural forces of recovery? Recovery in agriculture as in industry depends primarily upon a rise in world prices from levels which reflect the existing chaos and disorder of world commerce. Staggering under a burden of debt which has become increasingly unmanageable as prices have fallen, a large part of the world has reverted to a condition approaching barter. Due to the necessity of safeguarding the base of their own currencies, nations have set up all sorts of trade restrictions. Commerce has been forced out of 'ts accustomed channels; foreign trade has been seriously reduced; and each new shock means a repetition of this spiral of world deflation. It has become the fashion to say that we must write down our fixed charges to present price levels. There is no reasonable Justification for saying that we must recapitalize the world upon a price level dictated by world chaos. The problem is to remove the obstacles that stand in the way of a reasonable recovery of world prices. A state of mind bordering on desperation underlies present world economic policies. Given that state of mind and it is inevitable that any action by the United States which could be construed as in the nature of an export bounty, would result, either directly or Indirectly, in further counter-vailing duties or other defensive measures imposed by countries which normally Import our agricultural products. This would mean a further curb on our farm exports and possibly a further fall in prices. Indeed It is not Inconceivable that a fall in world prices might measureabiy offset an artificial increase in domestic prices, leaving the farmer only a nominal gainer and the already overburdened American taxpayer a heavy loser. The world needs fewer trade barriers: artificial price-fixing measures adopted by this country would in all probability tend to increase them. . . With no pretense of presenting a final solution of the agricultural problem, the suggestions here presented may serve as a starting point for development, with all possible speed, of a practical farm relief program. Such a program must of necessity divide into two parts; First, short-road measures designed to aid the farmer in the present emergency; and second, long-road measures designed to strengthen the position of agriculture and remove the factors which bring about these recurring emergency situations. 1. World Prices the Starting Point—Instead of reflecting the existing relationship between supply and demand, present prices reflect the disorganized condition of world trade. To state the case is to point the remedy. Top-heavy intergovenmental debts lie at the root of this situation. Declining Prices have made debts unmanageable. Our debtors cannot pay in gold without further disruption of their currencies. They have to pay in commodities, and at present gold prices these debts have grown to twice their original size. Trade barriers prevent the payment of these debts in the form of commodities, except at heavy premium. The simple fact of the matter is that the rest of the world cannot get the dollars to pay for our products, so they are forced to buy elsewhere. No matter how low we depress our prices, the rest of the world will not or cannot buy our goods in anything like normal quantities. One way to bring about higher farm prices is to remove these obstacles. This does not imply the cancellation of a debt which was honestly contracted and should be honestly discharged. But it does indicate the imperative necessity of reorganizing the entire debt structure to meet conditions as they exist to-day. As the first and most important move toward relief for agriculture, the United States should initiate a full and frank discussion of the international debt situation. Instead of hiding our head in the sand, this situation should be brought out into the open at the first Opportunity. It may be possible, in return for reasonable readjustment of the war debt, to obtain a reasonable modification of the trade restrictions imposed by foreign countries, which are throttling American commerce in general and agricultural exports in particular. As a corrolary, and in all fairness, this may involve a reconsideration of our own tariff schedules; but the farmer, who receives no commensurate benefit from present tariff legislation, is entitled to ask that other tariffs be considered on the basis of the equities of each situation. In this connection, it should be borne in mind that prices are set, not by an economic calculating machine, but by the minds of men. Therefore, the mere fact that the United States took positive action toward a solution of these problems would probably be immediately reflected in higher prices. Indeed, it might mark the turning point toward world recovery, just as the present policy of drift has probably been a determining factor in retarding 2. Increased Domestic Suging.—This country is staggering under a heavy burden of unemployment; industry is operating at something like 50% of normal: and while there are some signs of improvement, recovery lacks sustained momentum. The principal reason is to be found in the fact that a panicky people is to-day spending up to only about a third of its real capacity to spend. America is living on whatever fat It has left. Why? Simply because people are afraid to buy They are afraid to buy, because they feel that no active measures are being taken toward the restoraton of stability. Get people to spend normally, according to theIr present Income, and we can soon move this country off "dead-center"; it Is only by restored buying that consumption can be increased; increased consumption means decreased unemployment; and so the vicious circle Is broken, at the only point at which it Is penetrable. The quickest way to restore public confidence is to take the mind of the public off of Voluntary Domestic Allotment Plans and other economic experiments. If the Nation can have a few months' release from uncertainty as to what new "white rabbit" plan is to come up next; If we can ward off proposals for tinkering with the currency and other similar panaceas, the public will soon settle down, and the depression will before many months be a thing of the past. That is the sanest way to help the farmer. President-Elect Roosevelt Seeks Conference with Secretary of State Stimson. It has become known that President-elect Roosevelt is to confer with Secretary of State Stimson. As to this, we 69 quote the following from Washington Jan. 5 to the New York "Times": A new move in co-operation between President Hoover and Presidentelect Roosevelt to facilitate the transfer of Administration problems was announced at the White House to-day in a statement that, at Mr. 'loosevelrs request, Secretary Stimson would confer with him to discuss foreign relations. The announcement was made orally by Theodore G. Joslin, Secretary to the President. "The President received a request from President-elect Roosevelt that the Secretary of State should discuss matters with him relating to the Department of State. The President is arranging a meeting at the Governor's convenience." The President and Mr. Samson at a luncheon to day were discussing the matters to be brought up at the conference when news came of the death of Calvin Coolidge. It was then said that the conference would not be arranged until plans are known concerning the funeral of Mr Coolidge. It was assumed, however, that the meeting will be held soon, but whether It will be held In New York or hero is not yet known. President Hoover and the Secretary maintained silence as to the scope of the subjects to be discussed with Governor Roosevelt, but officials said that the conference would be primarily informative and not designed to win the President-elect over to policies pursued by this Administration. President-Elect Roosevelt Confers with Democratic Leaders of Congress to Map Federal Legislative Program to Provide Additional Revenue—Proposed Increase in Income Taxes—Beer Tax to Be Provided and Gasoline Tax to Be Continued—Farm Relief Included in Proposed Legislation. At a conference between Democratic leaders of Congress and Pres.-elect Franklin D. Roosevelt, held at the instance of the latter in his home in New York City on Jan. 5, plans were laid for the enactment of legislation to provide additional revenue to balance the budget. To quote from the New York "Herald Tribune" of Jan. 6 the following program was agreed upon: Increase of normal income tax from 4% and 8% to 6% and 12%. Lowering of exemptions for married persons from $2,500 to $2,000, and for single persons from $1,500 to $1,000. Estimated to yield from $130,000,000 to $150,000,000. Hope for $125,000,000 from Beer. Tax on beer, $125,000.000. Re-enactment of gasoline tax, S137,000.000. Reductions in budget for coming year, $100,000,000. From the same paper we quote: At the suggestion of Mr. Roosevelt President Hoover's own estimate of the deficit for the current fiscal year, $492,000.000, was taken as the basis for calculations. Subsequent estimates of the deficit by others have been considerably higher. It was determined at the conference that the present session of Congress should pass the tax legislation, making the $100.000,000 reduction in the budget In addition to the savings of some $480,000,000 over last year, proposed by Mr. Hoover. legalize beer and pass the Democratic farm relief program. If all of this can be done and approved by Mr. Hoover, a special session of the new Congress will be unnecessary, according to the opinions expressed by Senator Joseph T. Robinson, minority leader, and Speaker John N. Garner. Repeal Bill to he Modified. Senator Robinson said also that the Blaine resolution for repeal of the Eighteenth Amendment would ho modified to fit the Democratic platform pledge and brought to a vote at the present Congress. The conference, called by Mr. Roosevelt, began at 9 o'clock in the study of his house at 49 East 65th St., and lasted until mid-night. The following Senators were present: Joseph T. Robinson, minority leader; Cordell Hull, of Tennessee; Pat Harrison, of Mississippi, ranking member of the Finance Committee; Key Pittman, of Nevada,ranking member of the Inter-State Commerce Committee, and James F. Byrnes, of South Carolina, member of the Special Economy Committee. Six Representatives were present; Speaker Garner Henry T. Rainey of Illinois, floor leader; James W. Collier, of Mississippi, Chairman of the Ways and Means Committee; Sam Rayburn, of Texas, Chairman of the Inter-State Commerce Committee. Joseph W. Byrns, of Tennessee, Chairman of the Appropriations Committee, and John McDuffie of Alabama, party whip. Also present were Swager Sherley, wartime Chairman of the House Appropriations Committee; James A.Farley, Democratic National Chairman; Frank 0. Walker, Treasurer of the National Committee; Louis McHenrY Howe, Mr. Roosevelt's intimate adviser; Professor Raymond Moley, Mr. Roosevelt's chicf economic adviser, and Charles Michelson, publicity director of the Democratic National Committee. Although Mr. Roosevelt depicted his own role as that of interrogator rather than of director it was evident that he was the master of the proceedings. A majority of the Congressional delegation arrived, It is known, with the intention of informing Mr. Roosevelt that It was useless for the present Congress to try to balance the budget. In view of the widely varying estimates on the deficit for the current year. Many, if not a majority, were ready to urge that he undertake the full responsibility himself, with the semidictatorial powers which they stand ready to grant him Use Hoover Figures on Deficit. Mr. Roosevelt's suggestion that Mr. Hoover's own figure on deficit be used as the basis for calculations Is believed to have changed their views. . . Mr. Roosevelt and Senator Robinson and Speaker Garner alike said that an increase of the surtax on high incomes was not discussed. Speaker Garner said that it had not been decided whether to make the Increase In the Income tax applicable to 1932 incomes. "Well, balancing the budget was the greatest and only thing of importance we decided on," began the Speaker. "The President estimated Financial Chronicle 70 $492.000.000 in deficit when he sent the budget in. That does not include reduction of the public debt. We proposed to meet that deficit by . . ." Sees $200,000,000 Tax neld. He retailed the program. He said that the estimated revenues from beer the Income tax and lowering the exemptions were a miniand increasing mum. He said he thought the change in the Income tax might yield $200,000,000. In response to a question addressed to both, Senator Robinson said: "There was no suggestion of a change in the surtax on large incomes." Senator Robinson said he expected the Democratic budget balancing program, the farm relief program and the legalization of beer would be passed at the short session. "With thss program," he said, "a special session in all probability can be averted," Asked if he thought the program would receive Mr. Hoover's approval, which is indispensable in view of the absence of a two-thirds majority in either house to override his veto, Senator Robinson said he saw no reason why Mr. Hoover should not approve the legislation. He said, however, that the beer bill would be passed separately,free of other revenue measures. The proposed tax on inter-State motor commerce was not discussed, Senator Robinson said. Confers on Tariff. Earlier in the day Mr. Roosevelt discussed the tariff at length with Senator Edward P. Costigan, of Colorado, and Representative David J. Lewis of Maryland, both of whom are former members of the Tariff Commission. Mr. Roosevelt refused to reveal the trend of their conversation. From the New York "Times" of Jan. 6 we take the following: Mr. Roosevelt, who talked vritn newspaper reporter. after Mr. Garner and Senator Robinson nad left for Washington, outlined the same program. He made it clear that toe proposal to increase the taxes on persons with small Incomes had been the proposal of the Congressional leaders instead of himself. He indicated tnat he had not disapproved the plan. There was no mention at the conference, it was said, of a general manufacturers' sale, tax, opposition to which, by Mr. Roosevelt caused its aoandonment by the Democratic leaders at Washington. Railroads Also Discussed. While the conference was mostly on the budget and Government finances, the serious condition of the railroads also came up for consideration. Mr. Roosevelt was informed that several railroads, including two of the large Eastern systems, have approached a point where they need further governmental aid. The method of rendering assistance was not definitely agreed upon. but Mr. Roosevelt and his Congressional conferees determined that something must be done to aid the railroads immediately. The most available source of support for the railroads was agreed to be the Reconstruction Finance Corporation. The problem presented itself as to how to so amend the Reconstruction Finance Act as to make the agency more helpful in the crisis. Data before the conference showed that the railroads in question already had exhausted all their acceptable security in obtaining loans from the Reconstruction Finance Corporation. The suggestion was made in the discussions that the law be so amended that securities not now acceptable might be tendered, backed by such moral security as might accrue from the knowledge of the former reputations of these railroads for earnings. Representative Rayburn remained over for possible further discussion of the railroad situation. Other members of the conference were asked by the President-elect to give thought to the problem with the view of giving some assistance to the carriers at the earliest possible date. United States Withdraws Marines from Nicaragua— State Department's Announcement. The evacuation of the United States marines from Nicaragua was completed on Jan. 2 when 80 officers and 815 men embarked at Corinto for home. A radio message from Managua (Nicaragua) to the New York "Times" reporting this, added: The transport Antares sailed for San Diego, Calif., with 17 officers and 304 men. The transport Henderson, bound for Quantico and Hampton Roads, Va., carried 63 officers and 511 men,Including Brig.-Gen. Randolph C. Berkley, commanding the marines ;ti Nicaragua; Brig.-Gen. Calvin B. Matthews, former commander of the Nicaraguan National Guard: Brig.Gen. George Richards and Major Raphael Griffin, Chief of Staff. A large, friendly crowd gathered at the railroad station here to watch the marines entrain for Corinto. The evacuation was effected without incident. On Jan. 1 (the eve of the termination of American occupation of Nicaragua) the State Department at Washington issued a statement reviewing the circumstances which led to intervention in 1926 and the decision to retire, and wishing that Central American country success and happiness. In giving the announcement of the State Department, a Washington dispatch Jan. 1 to the "Times" from which the foregoing is taken, said in part: Last of Forces to Leave To-day. The remaining forces of marines and a few bluejackets, totaling approximately 700, will be evacuated to-morrow, and the responsibility for law and order will be left to the Nicaraguan Government with its National Guard as a policing force. This is being done in accordance with plans announced nearly two years ago to withdraw all the forces of occupation after the inauguration of the President elected in November 1932. Juan 131 Sacasa, until recently, Minister to the United States, is the new President. succeeding General Jose M. Moncada, who became President after Colonel Henry L. Stimson brought about a truce in the civil war as the representative of President Coolidge. American forces went to Nicaragua as a consequence of the revolution In 1928 and reached their high point numerically of more than 5.200 in January 1929. Since then they have been gradually scaled down to 700. During the occupation 20 officers and 115 men of the United States forces were killed or died of wounds received in action or in accidents, and 13 officers and 53 men were wounded in action but recovered, a total of 201 casualties. The National Guard also suffered numerous casualties In clashes with insurgents, numbers of whom still are active in the northwestern jungle region, Jan. 7 1933 Text of the Statement. The statement of the State Department follows: To-morrow the United States marines leave Nicaragua. No American armed forces will remain in that country, either as instructors in the constabulary, as a legation guard, or in any other capacity whatsoever. Their retirement at this time realizes in fact the intention announced by the Department of State in February 1931, of withdrawing the marines following the Presidential elections of 1932. The American forces were sent to Nicaragua in 1926 because the Nicaraguan authorities stated that they were unable to protect Americana whose lives were endangered by the civil war then in progress and that they desired the United States Government to take appropriate steps to protect its citizens in Nicaragua. They were retained there after the termination of hostilities in accordance with the request of the Nicaraguan Government and under the terms of the Tipitapa agreement, which put an end to the civil war, first, that American forces organize and train a non-partisan constabulary, and, secondly, that they assist in the superviaion of the elections for the Presidency and the Congress. The United States accepted these obligations out of a desire to assist Nicaragua to terminate the disastrous civil war and to lay the foundations for permanent peace through bolding free, fair and impartial elections. Three Elections Supervised. On three successive occasions, in 1928, 1930 and 1932, national election have been held under American supervision and under conditions which g.uaranteed to the voters of Nicaragua the opportunity to express their free and untrammeled choice. With the conclusion of the election on Nov.6 last, by which Dr. Sacasa was elected to the Presidency, the commitment of the United States, in so far as electoral supervision is concerned, has been fulfilled That the Nicaraguan people have just cause to be proud of their sense of civic responsibility is amply demonstrated by the services performed by the Nicaraguans, who presided at 247 of the 429 electoral boards. These chairmen performed their duties in a manner that has not admitted of criticism or reproach. This fact combined with the admirable attitude of the party in defeat, should augur well for the future of popular government in Nicaragua Both Nicaraguan political parties to the settlement which ended the civil war supported the disbanding of the old National Army, which had frequently been an instrument of undisguised political aggression. In its place, at the request of Nicaragua, American officers and enlisted men have organized and trained an entirely new and non-partisan force, the Guardia Nacional, grounded upon the fundamental precept of service to the country as a whole. During the past five years this force has developed into a well-disciplined and efficient organization with a high esprit de corps. Natives Take Over Guard. The direction of the Guardia has now passed from American to Nicaraguan officers, and it is noteworthy that both political parties have agreed on their own initiative to a plan for insuring the non-political character of that organization. This act of turning over the direction of the Guardia to Nicaraguan officers marks the realization of the other major commitment which the United States assumed at Tipitapa. The withdrawal of the American forces, therefore, follows upon the fulfillment of the above-mentioned obligations and marks the termination of the special relationship which has existed between the United States and Nicaragua. This country has considered it a privilege to assist Nicaragua and will always look with friendly sympathy and satisfaction upon the progress which Nicaragua, through her own efforts will inevitably achieve in the future. The United States desires for Nicaragua, as for her sister republics in Central America, peace, tranquility, well-being, and the just pride that comes from unimpaired integrity. Secretary Adams Sends Greetings. Secretary of the Navy Adams to-day sent a New Year's greeting to the American forces prior to their evacuation from Nicaragua. It read: Upon the withdrawal of the Navy and Marine Corps personnel from Nicaragua, I wish to express to them and to the naval service my sincere appreciation of the commendable manner in which the personnel employed there have performed their important and hazardous duties. That service has required ability, courage, determination, discretion and hard work. The record has been excellent throughout and reflects great credit upon the Marine Corps and the whole naval service. It is my desire that this message be published to those who have served in Nicaragua with the brigade or with the Guardia Nacional and to the personnel who have served in detachments landed in Nicaragua from vessels of the Navy since 1928. Juan B. Sacasa Installed As President of Nicaragua. General Jose M.Moncada,the retiring President, delivered a farewell message to a joint session of Congress on Jan. 1 and then gave a ribbon and insignia of office to his successor, Dr. Juan B. Sacasa, said Associated Press advices from Managua (Jan. 1) which further stated: In his address, President Sacasa gave his thanks to the supervision of the marines over the election. This enabled Nicaraguans to vote as they pleased, the President said. "Two major problems are before the Government," he continued. "First, the disturbed conditions in the northern departments, and second the withdrawal of the United States marines. "I will devote all the persuasion that is compatible with national dignity to a return to the guarantees of life and property. I shall leave no stone unturned to bring that about, although it may be necessary to continue to use armed force." President Sacasa made no mention of the insurgent, General Augusto 0. Sandino's name, in the address. "The departure of the United States marines imposes a sacred duty on the entire citizenry to co-operate with the Government to .ring about peace," he said. "After to-morrow. Nicaragua will be without the marines. and the country again assume complete sovereignty. "I intend to maintain the National Guard free from political activities. I am disposed toward encouraging private initiative and establishing new industries, the building up of means of communication to alleviate the economic crisis, and to encourage closer relationship with Central American republics. "The Government intends to follow paths of tolerance with regard to religion. When my period of government terminates. I hope to prize the conviction on the part of citizens that I did not omit anything which would add to the aggrandizement of Nicaragua." F. J. Lisman Declares Reduction of Taxes Impetative During Coming Year. According to F. J. Lisman, the outstanding feature of economics in 1932 has been the expected revolt of the taxpayers which has resulted in great promises for economy by the politicians. Mr. Lisman states that "judged by the action of legislative bodies up to date, these promises will not be translated into action unless taxpayers are fully as insistent on economy as the tax-eating organizations and their members are on spending money. No economies," he Volume 136 Financial Chronicle contends, "will be instituted until the taxpayers organize emnasse and jointly and individually notify their representatives that they will vote against them at the next election if they do not promptly abolish bonuses, unnecessary bureaus, &c." Mr. Lisman adds: The national tax bill is around 15 billions; the national income for 1932 is variously estimated at from 38 to 45 billions, which means that taxes absorb from 33% to 40% of the income. This leaves $200 more or less (against around $600 in 1929) per capita, that is, for every man, woman and child, plus hopes, to live on, pay interest charges and run the automobile. The question whether the hopes which proverbially spring eternal in the human breast will be realized during 1933 is puzzling all of us who are trying to peer through the fog of national and international uncertainties—the probable prices of raw materials, unemployment, tariffs, debt settlements, disarmaments and other dilemmas. Each country thinks it has suffered the most from the present business depression. The writer inclines to the opinion that the United States is probably the hardest hit because it indulged in the wildest debauch of any country. It probably manufactured at least twice as much credit in proportion to bank deposits as any other country. Nearly everyone with credit possibilities was encouraged, or had the fool courage, to go into debt and is now suffering from the necessary deflation. This deflation may have to take its course similar to the period between 1873 and 1879. The present situation can either be cured by readjustment of the capital structure of corporations and individuals to whatever extent is necessary, or by inflation which would snake things worse in the long run, or by a mixture of the two. Everything depends on the accident of leadership. All people think they are governed by their parliaments or by the Inherent strength of their own national character, but they are all deluding themselves. Napoleon, the little upstart Corporal from Corsica, directly upset the entire world for 15 years and indirectly for over half a century or longer, by the sheer force of his personality; Darius of Persia, Cleopatra, Caesar, Ring Girolus, Alexander the Great, Oliver Cromwell and many others did likewise. No doubt the same remarks apply to the past civilizations of the Babylonians, Assyrians, Hitites, Incas and many others we either vaguely know of or do not know about. What is going to happen in 1933 largely depends on the leadership of strong personalities in the world, and particularly, probably in their respective order, in the United States, Great Britain, Germany, France, Italy and Japan. There are leaders in each of these countries who envisage the whole situation but it is doubtful whether they can carry their parliament or people with them toward constructive action. History shows parliaments always decry leadership, and only follow when they must. The recent action of France in defaulting on the Dec. 15 installment of its debt to the United States brings international questions to the forefront, requiring that definite action be taken fairly promptly. America will certainly get less money. Will the reduction of international payments be accompanied by world armament reduction, lowering of tariff walls, with consequent decrease of nationalism, confidence in world peace and stimulation of confidence resulting in improved world trade? Probably no one can foretell all this at this time. Mr. Lisman believes that the events of 1933 are still eompletely hidden in a dense fog. Only a few events stand out clearly: 1. The taxpayers want reduced taxes; the parliaments have not the courage to reduce them because any substantial reduction in any particular direction is resented by a large percentage of voters who are, or believe themselves to be, disadvantaged by such action. 2. The parliament of each country plays politics as keenly and as selfishly as ever. 3. The Russian experiment is drifting toward collapse, the time point of which depends on the accident of leadership. 4. The interplay of these certainties, plus innumerable uncertainties, constitutes the puzzle of New Year's, even of 1933. 5. Inflation is not the answer, because this would depreciate all our insurance policies and savings. Inflation does not accomplish the purpose of "soaking the rich," but accomplishes the Biblical saying, "From him that hath not shall be taken." Work on Federal Census of 1930 Nearly Completed. The 15th Decennial Census, the most comprehensive enumeration of its kind ever undertaken, will be completed within the three-year limit allowed by law which ends on Dec.31, Wm.M.Steuart, Director of the Census, announced on Nov. 15, and it was stated that as the appropriation was nearly exhausted, most of the 630 temporary employees remaining out of the maximum of 6,022 reached on Nov. 1 1930, would have to be dropped from the rolls at the end of the month. This will be the first time that a decennial census has been completed within the prescribed period, said the Bureau of the Census on Nov. 15, its announcement adding: Over 40.000 Pages of Statistics. All the copy for the 34 volumes which will form the final reports, aggregating over 40.000 pages. has been sent to the Printing Office, and many or these volumes have already been printed or are now on the press, while proof has been received for the most of the remaining ones. These reports contain a wealth of statistical data covering population, unemployment, agriculture, horticulture, drainage, irrigation, manufactures, mining, distribution and construction. New Features of the Census. Statistics of distribution or trade and ofconstruction or building operations represent two new and important compilations of the 15th Census. which Director Steuart states, were included by authorization of Congress and in response to the public demand for the information on theses subjects. Another new feature will be the tabulation of population data by families In addition to the usual tabulation in which the individual is the unit. Committees of Statisticians and Economists. In accordance with Departmental policy net only the preliminary plans but the actual progress of the work of the entire Census was carried on with the earnest co-operation of nationally known statisticians and economists from private life organized as committees and giving their services without eompsensation in order to obtain and compile data of maximum value to the public. 71 What the Census Bureau Will Do Now. Following the completion of the 15th Census the regular force of the Bureau will be actively employed on the current and periodical statistical compilations which the Bureau is required by law to make. These include current statistics of production; annual compilations of statistics of births, deaths, marriages and divorces, also statistics of the revenues and debt of every State and of every city of over 30,000 population; a census of manufactures, which is taken every second year;a census of electirc light and power plants, electric railways, and telephones and telegraphs, which is taken every fifth year; also two special decennial censuses, namely, the census of public debt, revenue, expenditures, and tax levies, covering all Statescities, and political subdividions; and the census of the defective, dependent and delinquent classes confined to or admitted to institutions,including the insane, the feeble-minded, sentenced prisoners, and paupers. Preparaations for both these censuses are now under way. They will cover the year 1932. A third decennial census is that of religious bodies or churches, which in regular course will be taken in the second half of the decade and cover the year 1936; and a mid-decennial census of agriculture will be taken in 1935. Program for Economic Recovery Urged upon Presidentelect Roosevelt by Group of Economists Calls for Settlement of Inter-Allied Debts, Lowering of Tariffs and Maintenance of Gold Standard. In a letter to President-elect Franklin D. Roosevelt, made public at Baltimore on Jan. 2, a group of economists, 20 in number, urge reciprocal lowering of tariffs, prompt settlement of inter-allied debts and maintenance of the gold standard as a "minimum program for economic recovery." The text of the letter as made public by Dr. Broadus Mitchell, of Johns Hopkins University follows: The following statement is in the judgment of the undersigned economists a minimum program for economic recovery: The urgent immediate problem is the foreign trade situation. Lacking an adequate export market, agricultural products and raw materials bring ruinously low prices, and there is an immense unbalance between them and manufactured goods. As a result even the relatively scant output of the factories is marketed with difficulty. There should be prompt reciprocal lowering of tariffs and prompt settlement of inter-allied debts. Our own tariffs should be lowered to such an extent as will admit enough additional imports of diversified finished manufactures to take out our own agricultural and raw material exports without the necessity of foreign loans. We are convinced that such lowering of tariffs on finished manufactured goods will not decrease employment in manufacturing. On the contrary. by stimulating price improvement in agricultural commodities and purchasing power in agricultural communities, and by stimulating recovery In Europe as well, it will produce a very great increase in manufacturing activity and employment in the United States. The settlement of inter-allied debts should be on a negotiated basis which will probably not be satisfactory to public opinion in any country. but which, promptly accomplished, will be immensely beneficial to all countries. The gold standard of present weight and fineness should be unflinchingly maintained. We should also encourage and facilitate the prompt restoration of the gold standard abroad—which settlement of inter-allied debts and tariff reductions will do. With adequate movement of goods across international borders, the gold of the United States and of the world is more than adequate for all credit peeds. If, however, trade restrictions throw an undue burden on gold in making international payments, then debtor countries have difficulties in maintaining the gold standard and confidence is so low in creditor countries that they cannot make effective use of their own gold on expanding credit. Credit rests on the movement of goods as well as on the gold supply. Agitation for currency experiments would impair confidence and retard recovery. Those signing the letter are: Frank A. Petter, Princeton University. Benjamin H. Hibbard, University of Wisconsin. Davis R. Dewey, Massachusetts Institute of Technology, E. W. Kemmerer. Princeton University. Ernest M. Patterson, University of Pennsylvania. Abraham Berglund, University of Virginia. Francis Tyson, University of Pittsburgh. George Heberton Evans Jr.. Johns Hopkins University. M. B. Ilammond, Ohio State University. George E. Barnett. Johns Hopkins University. B. M. Anderson Jr., Chase National Bank. E. L. Bogart. University of Illinois. Bernhard Ostrolenk, College of City of New York. Morris A. Copeland, University of Michigan. F S. Deibler. Northwestern University. J. F. Ebersole, Harvard University. Claudius Murchison, University of North Carolina. 'Willard E. Atkins, New York University. Joseph It. Willits. University of Pennsylvania. Broadus Mitchell, Johns Hopkins University. President Hoover's Statement Bearing on Report of Research Committee on Social Trends—President'a Foreword to Report. Incident to the report of the President's Research Committee on Social Trends (made public on Jan. 2 and to which further reference is made in this issue of our paper), President Hoover on Jan. 1 issued a statement as follows: In commenting upon the publication of the report of the President'g Research Committee on Social Trends, I deem it worth while to expand somewhat the prefatory note which I prepared some months ago for pub Ilcation with it. That foreword is as follows: "In the autumn of 1929 I asked a group of eminent scientists to examine Into the feasibility of a National survey of social trends in the United States. and in December of that year I named the present Committee under the Chairmanship of Dr. Wesley C. Mitchell to undertake the researches and make a report. The survey is entirely the work of the Committee and it. experts, as it was my desire to have a complete, impartial examination of 72 Financial Chronicle the facts. The Committee's own report, which is the first section of the published work and is signed by members,reflects their collective judgment of the material and sets forth matters of opinion as well as of strict scientific determination. "Since the task assigned to the Committee was to inquire into changing trends, the result is emphasis on elements of instability rather than stability in our social structure. "This study is the latest and most comprehensive of a series, some of them Governmental and others privately sponsored, beginning in 1921 with the report on 'Waste in Industry,' under my chairmanship. It should serve to help all of us to see where social stresses are occurring and where major efforts should be undertaken to deal with them constructively." I wish to add to the foregoing the observation that the significance of this report lies primarily, first, in the fact that it is a co-operative effort on a very broad scale to project into the field of social thought the scientific mood and the scientific method as correctives to undiscriminating emotional approach and to insecure factual basis in seeking for constructive remedies of great social problems. The second significance of the undertaking is that, so far as I can learn. it is the first attempt ever made to study simultaneously all of the fundamental social facts which underlie all our social problems Much ineffective thinking and many impracticable proposals of remedy have in the past been due to unfamiliarity with facts in fields related to that in which a given problem lies. The effort here has been to relate all the facts and present them under a common standard of measurement. I regard these aspects of the report as of far greater significance and value than any of its details, admirable though these studies are. President's Research Committee on Social Trends Spent a Million in Work—Six Members Well Known in the Fields of Economy and Sociology-37 Authorities Aided. From the New York "Times" of Jan. 2 we take the following: The report of President Hoover's Research Committee on Social Trends is described by the Committee's Executive Secretary, Edward Eyre Hunt. as "a democratic mobilization of information." The Committee was organized in September 1929, as a result of a conference called by President Hoover. Its purpose, as stated in the present report, was "to examine and report upon recent social trends in the United States, with a view to providing such a review as might supply a basis for the formulation of large National policies looking to the next phase in the Nation's development." The six Committee members were all well known in the fields of economics and sociology. Dr. Wesley C. Mitchell, Chairman, is Director of the National Bureau of Economic Research. Professor of Economics at Columbia University and an authority on money, prices and business cycles. Dr. Charles E. Merriam, vice-chairman and chairman of the Department of Political Science at the University of Chicago, has taken an active part in reform politics in Chicago and has written extensively. Shelby M. Harrison, Secretary-Treasurer, is General Director of the Russell Sage Foundation and has directed several social surveys, including that made for the Regional Plan of New York and Its Environs, Dr. Alice Hamilton of the IIarvard School of Public Health is a specialist In industrial medicine who has made studies of occupational diseases and of industrial poisons. Dr. Howard W. Odum. Director of the Institute for Research in Social Science of the University of North Carolina, has made a number of sociological studies of Southern conditions and is an authority on the Southern Negro, Dr. William F. Ogburn, Director of Research, formerly of Columbia University. is now Professor of Sociology at the University of Chicago. He has written extensively in his field, particularly on marriage and the family. Mr. Hunt was associated with Mr. Hoover in the work of the Commission for Relief in Belgium; headed the economic rehabilitation work of the Red Cross In France in 1917 and 1918; was Secretary of the President's Conference on Unemployment in 1921 and of the Coal Commission of 1922, and of the Emergency Committee for Employment In 1930 and 1931, and is an authority on scientific management. In addition to those named, 37 authorities in the various fields assisted in the preparation of the report by writing or collaborating in the respective chapters. The work was done with what is declared to be the most extensive cooperation of public and private organizations, as well as individuals, ever accorded any similar enterprise in the United States. The Committee devotes more than 12 pages of its report to an alphabetical list of acknowledgments. Although the undertaking was made possible by a gift of $500,000 from the Rockefeller Foundation, it is estimated that at least an equivalent amount was contributed by individuals and organizations in the form of services for which no charge was made, bringing the total cost to $1,000,000 or More. The inquiry was so timed that the results of the 1930 Census could be incorporated in the report, and the Bureau of the Census co-operated in making its data available at the earliest possible moment. Headquarters were maintained in New York City, but members and contributors kept in constant touch from all parts of the country. After the work was laid out, progress reports were made at the regular monthly committee meetings, and as the tentative draft of each chapter was prepared, it was mimeographed and subjected to the criticism of the Committee and its staff and of the contributors as a group. In this way the final report represented 29 separate investigations, each in a distinct field, and each checked by the authorities in the other fields. Report of President Hoover's Research Committee on Social Trends—Governmental and Economic Organization Growing at Rapid Pace—Church and Family Decline in Social Significance—Economic Planning Needed to Deal with Central Problem of Balance. A three-year inquiry into changing social conditions in the United States was completed on Jan. 2 when the Research Committee on Social Trends, appointed by President Hoover in 1929, made its report, presenting (to quote the Committee) Jan. 7 1933 a veritable "yesterday, to-day and to-morrow of American life." The report, which is the work of more than 500 investigators, deals with shifting social trends in the life of the American people during the first third of the Twenthieth Century. The Committee, in a summary made available on Jan. 2, has the following to say regarding the report: Our life has become disjointed and upset in many activities because social changes are taking place so fast in some quarters and so slow in others, the report emphasizes. These unequal speeds are causing jams, dangers and tensions, throwing the social organization out of balance and causing numberless National problems with promise or others to emerge, the report shows. Change in itself is not an evil, however, as hope for social betterment in the future lies in the fact that we can adjust ourselves to change, the report explains. These problems caused by social change and those emerging are dealt with by the President's Committee in its own section of the report, which is a review of the findings of the investigators who have contributed 29 sections of the report. The project was made possible by a grant of funds from the Rockefeller Foundation. in its review of findings the Committee records long time social problems, especially those which will be In the process of solution and treatment for generations, pointing out both the hazards and benefits to society arising out of shifting social trends. The Committee discussed the following as emerging National problems facing the people of the United States: Social Invention keeps too far behind mechanical invention. Thus we are faced with the necessity of finding a way to make full use of the march of science, invention and engineering skill without victimizing many of our workers. Unless social invention is speeded up or mechanical invention slows down, grave maladjustments are bound to occur. It is important to develop a policy which will enable us to bring together as a whole all the disjointed factors and elements in our social life so that labor, industry, government, education, religion and science may eventually reach a higher degree of co-ordination in the next phase of our National development. Two great departments of our American system, the governmental organization and the economic organization, are growing at a rapid pace, while two other historic institutions, the church and the family, have declined in social significance, though not in human values. The church and the family have lost many of their traditional regultory InfluecIes over human behavior, while Industry and labor have assumed a larger degree of control over the conduct of our people. But government, like the family, has been backward in strengthening its social services to meet new conditions. To bring about effective co-ordination of the factors of our evolving sociaty, it is necessary, wherever possible and desirable, to slow up the changes which are too swift and to speed up those which are too slow. Our standard of living for the very near future may decline because of the law wages caused by unemployment, possible slowness of business recovery and the weakness of mass action by employees. Exploitation of natural resources increases, yet technological improvements have created problems of surplus rather than of scarcity for the Immediate future. Immigration restriction and birth control are slowing up population growth so that we may have a stationary population in the United States before the end of the century, with the proportion of children growing less. This will create the problem of smaller markets. Organized labor's power and influence have waned but friction and strikes between employers and employees may arise more frequently in future. We devote far more attention to making money than to spending It, and the buying public is confronted with high-pressure salesmanship, instalment selling propaganda and other sales tactics adopted by competitors in business to get their share of the consumer's dollar. Social discrimination, injustice and inequality of opportunity continue to block the path of adaptation both in the case of the foreign-born and native color groups, but friction between negroes and whites is lessening. If divorce continues at its present rate, one of every six marriages this year will ultimately end in the divorce courts. The school is both a centre of hope and concern. We are eager for education and nearly all American children of elementary school age go to school, but the changes in industrial, economic and social conditions domand a radically different kind of education than that of the past. There are too many doctors in cities and not enough in the rural districts. A medical system is needed which will make the results of scientific research and experiment in medicine available to all at reasonable cost. Crime has greatly increased, due largely to the automobile and prohibition, but there has been no real crime wave. Organized crime flourishes, however Our National, State and city governments have increased in size and power, affording on the whole now and beneficlal services to citizens In spite of the fact that vast areas of government have been dominated by corruption, incompetence and partisanship. Growing centralization in State governments is evident and the executive gains in power and prestige both in the Nation and the States. Rural life is being transformed by communications and inventions, and differences between the city dweller and the farmer are disappearing, A new population grouping, the metropolitan region, which Is neither city, county nor 3tate, has been created by the automobile and the telephone. The members of the Committee which has submitted its report to President Hoover are: Dr. Wesley C. Mitchell, Professor of Economics, Columbia University, Chairman. Dr. William F. Ogburn, Professor of Sociology, University of Chicago, Director of Research. Dr. Charles E. Merriam, Professor and Chairman of the Department of Political Science. University of Chicago. Dr. Howard W. Odum, Director of the Institute for Research in Social Science, University of North Carolina. Dr. Alice Hamilton, of the Harvard School of Public Health, Boston. Shelby M. Harrison, General Director of the Russell Sage Foundation, New York. Edward Eyre Hunt is Executive Secretary of the Committee. A foreword by President Hoover which accompanies the Committee's report, is given elsewhere in this issue. Financial Chronicle Volume 136 In its review of findings the Committee says in part: The Large Problem of Economic Balance. In the halcyon days in 1925-1929 there were many who believed that business cycles had been "ironed out" in the favored land. Everyone now realizes that we have been suffering one of the severest depressions in our National history. Those who are acquainted with pa.t experience anticipate that, while business will revive and prosperity return, the new wave of prosperity will be terminated in its turn by a fresh recession, which will run Into another period of depression, more or has severe. Whether these recurrent episodes of widespread unemployment, huge financial losses and demoralization are an inescapable feature of the form of economic organization which the Western world has evolved is a question which can be answered only by further study and experiment. That the severity of the current depression has been due in large measure to non-cyclical factors is generally admitted. But this admission means merely that besides checking the excesses of booms, we must learn how to avoid errors of other types as well before we can hope to make full use of the productive possibilities which modern technology puts at our disposal. Competition for Profits. Reflection upon this range of ideas leads to more fundamental issues. The basic feature of our preesnt economic organization is that we get our livings by making and spending money incomes. This practice offers prizes to those who have skill at money making; it imposes penalties upon those who lack the ability or the character to render services for which others are willing to pay. A decent modicum of industry and thrift is maintained by most men and women, and the incentive to improve industrial practice in any way which will increase profits is strong. When business Is active and employment full, this scheme of organizabig the production and distribution of real income yields results upon Which we congratulate ourselves. Probably no other large community ever attained so high a level of real income as the inhabitants of the United States enjoyed on the average in, say, 1925-1929. But even In good times it is clear that we do not make full use of our labor power, our industrial equipment, our natural resources and our technical skill. The reason why we do not produce a larger real income for ourselves is not that we are satisfied with what we have, for In the best of years millions of families are limited to a meagre living. The effective limit upon production is the limit of what the markets will absorb at profitable prices, and this limit is set by the purchasing power at the disposal of would-be consumers. Wages and Dividends. Yet how can larger sums be paid out in wages and dividends? No business can pay wages for making goods which will not sell at a profit, and no business can make a profit if it pays wages higher than its competitors for labor of the same grade of efficiency. Of necessity, the business organizer's task is often the unwelcome one of keeping production down to a profitable level. There Is always danger of glutting the markets—a danger which seems to grow greater as our power to produce expands and as the areas over which we distribute our products grow wider. Despite Improvements in communication, increased accuracy in business reporting, the strenuous efforts of the Department of Commerce and the rising profession of business statisticians, the task of maintaining a tolerable balance between the supply of and thc demand for the innumerable varieties of goods we make, between the disbursing and spending of money incomes, between investments in different industries and the need of industrial equipment, between the prices of securities and the incomes they will yield, between the credit needed by business and the volume supplied by the banks, seems to grow no easier. When these balances have been gravely disturbed, business activity is checked by a recession, which is followed by a depression of Industry, trade and finance. Then our scheme of economic organization yields results which satisfy no one. The Income of the whole population falls by 10 or 20%; in extreme depressions by a substantially greater figure. And these average losses are accompanied by appalling individual tragedies In millions of cases, scattered through all classes of society, but commonest among those who have few reserves. To maintain the balance of our economic mechanism is a challenge to all the imagination, the scientific insight and the constructive ability which we and our children can muster. Economic Planning a Central Problem. To deal with the central problem of balance, or with any of Its ramifications, economic planning is called for. At present, however, that phrase represents a social need rather than a social capacity. The best Which any group of economic planners can do with the data now at hand, bulky but Inadequate is to lay plans for making plans. Those who know most about the actual conduct of the work of the world realize most keenly the magnitude of the task Involved in planning. To work out schemes which could be taken seriously as a guide to production and distribution would require the long collaboration of thousands of experts from thousands of places. In addition to the accumulation and sifting of countless figures not now available, planners would have to decide intricate problems of social theory, either by thinking them out, or by accepting arbitrary rules. To gloss over the difficulties of the task is no service to mankind; to face them honestly should not discourage those who have faith in men's capacity to find their way out of difficulties by taking thought. As the task of planning economic relations is faced in detail, it is not unlikely that modest schemes will be devised which will make the present organization work more steadily. It is more In line with past experience to anticipate a long series of cumulative improvements which will gradually transform existing economic organization into something different, than to anticipate a sudden revolution In our institutions. . . The Factor of Labor in Society. Wage earners may be viewed both as a factor in production and a great group in modern society. In the former role their record of labor in production has shown steadily Increasing efficiency as measured in output per worker, an increase of 50% in the manufacturing industries since the beginning of the Twentieth Century. In part this has neon due to the aid given oy machines and in part to the organization of work more closely in accord with the principles of scientific management, supplemented by wiser consideration of personal factors in working relations. Strikes have declined about 80% since the World War. In so far as increasing production may be due to the growth of technology, the prospect is very bright; In so far as It is due to harmony in relationships between employer and employee, the past decade may have been exceptional and friction and strife may arise more frequently in future. One of the problems of the future will be the condition of labor in Industry and the part played by wage earners and their organizations in influencing these conditions. This problem at one time centred around the question of decent physical conditions of work and the attitudes of employers and workers. Such conditions have been better since the war, and the growth of scientific management should bring about further Em- 73 provements, but this is a vast task and there will no doubt remain many grievances and complaints without satisfactory means of adjustment. Democracy in Industry. The problem of the conditions and role of labor has been associated at other times with the idea of industrial democracy,an extension into industry of the idea of political democracy with revolutionary possibilities. For a time, around the period of the World War, it appeared as if the movement might make a beginning here and there In post-war years, however, the movement for better management has advanced and less is heard to-day of industrial democracy. Solutions may be sought along the lines of management and plant organization or along the lines of industrial democracy. which set of solutions proves dominant is an issue which will profoundly affect the status of labor in modern society and as such is vital not only to the workers but to the community as a whole. From the beginning of the century until the depression beginning in 1929 labor's standard of life has been raised about 25%,as measured by the purchasing power of wages, although this increase prevailed through only a few of the 30 years. In the two years following 1929, the aggregate money earnings paid to American employees fell about 35%, while the cost of living declined 15% Along with health and happiness, a high standard of living is a great desideratum of struggling mankind. Abundant natural resources, a slowly increasing or stationary population and an ever expanding technology all point over the years to a higher standard of living, if the various possible strains on the economic organization do not weaken It for too long periods. Such strains appear in business depressions, in wars, in revolutions or very rapid transformations and in weaknesses in some particular part of the structure. For the very near future the standard of living may decline because of the menace to wages caused by unemployment, the possible slowness of economic recovery from the depression and the weakness of collective action on the part of wage-earners. Certainly every effort should be made to prevent any lowering of the plane of living. Adequacy of Wages. No doubt the adequacy of wages for meeting minimum standards of living will long remain a matter of dispute. The problem of wage adequacy is affected by the appeals of new goods such as radios, automobiles, moving pictures, telephones and reading matter. The number of such items in the future will be greater, and sacrifices in food or in other ways which affect health will be made, unless all of us can be better educated as consumers. There Is, however, one interpretation which should be considered. Death rates are still much higher in the lower income groups than In others. Until a point is reached where the death rate does not vary according to income, it seems paradoxical to claim that wage earners are receiving a living wage. Poverty is by no means vanquished, although how widespread it may be is not now known, Air there have been no recent comprehenisve studies of family Income and expenditure. The indications are that even in our late period of unexampled prosperity there was much poverty in certain Industries and localities, in rural areas as well as in cities, which was not of a temporary or accidental nature. The depression has greatly intensified It. After this crisis is over the first task will be to regain our former standards,inadequate as they were. The longer and the greater task, to achieve standards socially acceptable, will remain. In addition to their effort to raise standards of living, wage earners have had a further objective in trying to shorten the hours of work, and since the beginning of the century hours have been shortened by about 15%. But such an average figure conceals a great variety of conditions. In several industries the hours worked were as high as 60 per week in 1930 and in others as low as 44. Pioneer and Puritan habits nad philosophies regarding long hours of labor have given ground slowly before the oncoming machine, but long hours of toil promise to be less in the future, and with this lessening of labor comes the problem of how best to utilize the hours thus saved. No Unemployment Solution. While there has been gain to labor in higher earnings and shorter hours, there has been no such success against the terror of unemployment. Along with physical illness and mental disease, unemployment ranks as a major cause of suffering. Fortunately, it has been less extensive among married men than among the widowed,separated and divorced, and much less than among the single, if we may judge by a few sample studies. Fewer women than men have lost their jobs, and the old appear to have remained unemployed a much longer time than the young. Accordingly to an estimate commonly used, there were 10,000.000 unemployed In the summer of 1932, although if there were a system of recording those out of work the margin of error in this estimate might be found wide. Insecurity of employment is characteristic of the economic process, and no doubt if control of rates of change were possible, unemployment could be greatly reduced. Free land no longer offers an outlet. Emergency relief is inadequate. The larger problem seems to be that of making the proper application of the principle of insurance, discussed elsewhere. The membership of American trade unions declined from 5 million in 1920 to 3.3 million in 1931, the first time in American history that the unions did not gain in membership in a period of prosperity. Of great significance also is the fact that in the big industries. such as coal, meat packing and steel, the unions have lost ground and have made no gains in others, such as the manufacture of automobiles. When other functions than membership are considered, It is clear that the organization of labor has not gone forward as have other parts of the economic system Organizations of employers and of employees have changed at unequal rates ofspeed. Unless labor organizations show a more vigorous growth in the future, other resources of society must be drawn upon to meet these problems. The entire report of 1568 pages comprising the findings of the investigators and the Committee's interpretative review will be published by the McGraw-Hill Book Co. Elsewhere in this issue we give President Hoover's statement on the report issued Jan. 1. National Transportation Committee to Meet Jan. 9— B. M. Baruch Calls Session After Succeeding to Post Held by Late Calvin Coolidge. Assuming leadership of the National Transportation Committee,following the death of former President Coolidge, Bernard M. Baruch, Vice-Chairman, issued a call yesterday (Jan. 6) for a meeting of the Committee Monday (Jan. 9) at which an announcement will be made, it was said, regarding progress of the Committee's investigation. The 74 Financial Chronicle New York "World-Telegram" of last night, in indicating this, added: The Committee customarily has met on the first Tuesday of each month due to the fact that Mr. Coolidge made a practice of coming to the city on those days from his Massachusetts home. Death of the former Chairman of the Committee is not likely to delay preparation of its report, it was said. Announcement has been made heretofore that the findings likely would be made public at the end of January. The remaining four members of the Committee—Mr. Baruch, Alfred E. Smith, Alexander Legge and Clark Howell—are thoroughly familiar with the vieWs held by Mr. Coolidge on the various problems under study by the Committee, and the fact finding part a the Committee's work had been completed more than a week ago. That any appointment would be made to fill Mr. Coolidge's place was considered unlikely in financial circles. Mr. Baruch is also expected to continue to function as head of the body, despite the fact that illness prevented him from attending personally any of the earlier meetings. Loans Totaling $1,502,168,401 Advanced by Reconstruction Finance Corporation Since Feb. 2— $807,779,746—Repayments Loans to Banks $283,049,032, of Which $233,587,301 Was Returned by Banks—Relief Loans Paid to States $76,358,888— Other Borrowers, Railroads, Agricultural Marketing Projects, &c. A total of $1,502,168,401 has been advanced by the Reconstruction Finance Corporation since Feb. 2, according to a statement made public by the Corporation on Dec. 30. The figures in some instances represent cash loans to Nov. 30 and in other cases, to Dec. 23. The disbursement went to banks, railroads, farmers, States for relief purposes, and other borrowers in need of financial assistance to advance employment. Actual authorization of loans to Nov. 30 as revealed in the composite report detailing transactions since Feb. 2, amounted to $1,541,906,876 to 6,494 financial corporations and $52,104,357 for orderly marketing of farm products. An aggregate of $60,393,418 of those loans has been withdrawn or canceled, with $192,173,197 remaining at the disposal of borrowers. The Corporation report shows that $283,049,032 has been repaid, with banks, which have been advanced more cash than any other class of borrowers, repaying $233,587,301. The Corporation up to Nov. 30 lent $807,779,746 to 5,382 banks. Cash disbursements to Nov. 30 showed that $64,204,503 went to farmers for crop production; $1,340,162,760 was lent to banks, railroads and other borrowers of that type; $360,000 for self-liquidating projects and $1,281,957 for agricultural marketing. To the close of business Dec. 23, $19,800,392 was lent to farmers and stockmen through credit corporations. In Associated Press accounts from Washington Dec. 30, ft was also stated: Up to Dec. 23 the Corporation had announced relief advances to 36 States and 2 Territories amounting to 893,677.746, of which $76,358,888 already has been paid out. Since that date an additional 810,028,197 has been announced. The number of applications for loans received from financial institutions has declined steadily until in November only 576 requests were received, as compared with 1.527 last April. the peak month. Illinois and Pennsylvania have received the largest amounts to help care for ten' needy. The Corporation yesterday allocated additional sums to Illinois, bringing that State's total to 832,593.238. Up to Dec. 23 $12,835,538 had been made available to Pennsylvania. Wisconsin was next with $8.304,770, and three other States—Louisiana, Michigan and Ohio—had approximately $4,000,000 each. To aid financing of self-liquidating projects, the Corporation had agreed up to Dec. 23 to purchase $146.535,000 worth of securities with a view to aeating employment. Ninety-five loans aggregating $328,519,202 have been granted 56 railroads. Of this amount $261,666,197 has been disbursed and $11,714,562.71 repaid. The statement made available by the Corporation was given as follows in the "United States Daily": The Federal Government has lent $1,502.168,401.99 in actual cash through the Reconstruction Finance Corporation, according to figures made public to-day by the Corporation. Borrowers have repaid $283,049,032.40. Cash Disbursements Cash disbursements were divided among classes of borrowers as follows: Disbursed by Secretary of Agriculture to farmers for crop production loans from fundsfurnished to him by the Reconstruction Finance Corporation 864,201,503.06 Disbursed by Corporation to banks, insurance companies, building and loan associations, railroads and other borrowers under Section 5 of the Reconstruction Finance Corporation Act up to close of business on Nov.30 _ _ _ _ 1,340.162.760.71 Disbursed by Corporation to States and Territories for relief purposes up to close of business on Dec.23 76,358,888.69 Self-liquidating Protects. Disbursed by Corporation to finance self-liquidating projects Disbursed by Corporation to finance carrying and orderly marketing of agricultural commodities produced in the • United States up to close of business on Nov. 30 Disbursed to farmers and stockmen by regional agricultural credit corporations created by the Reconstruction Finance Corporation up to close of business on Dec. 23 $360,000.00 1,281,857.09 19.800,392.44 Jan. 7 1933 Repayments Received. Repayments have been received from classes of borrowers as follows: Repaid by farmers to Secretary of Agriculture to Nov. 30_ 814,599,450.42 Repaid by borrowers under Section 5 of Reconstruction Finance Corporation Act 268,406,262.26 Repaid by institutions borrowing to finance carrying and marketing of agricultural products 5,575.55 Repaid by farmers to regional agricultural credit corporations 37,744.17 Banks have been advanced more cash than any other class of borrowers, 5,382 of them having received 8807.779.746.69 up to the close of business on Nov. 30, of which they had repaid $233,587.301.84. Up to the close of business on Nov. 30 the Corporation had authorized 9,322 loans aggregating $1,541,906,876.47 to 6.494 borrowers under section 5 of the Reconstruction Finance Corporation Act and eight loans aggregating 852,104.357.23 to six borrowers under section 201 (d) of the Emergency Relief and Construction Act to finance the carrying and orderly marketing of agricultural products. An aggregate of $60,393,418.10 of loans of both classes had been withdrawn or cancelled and $192,173.197.80 remained at the disposal of borrowers. Cash disbursements and repayments are listed above. Up to the close of business on Dec. 23 the Corporation had agreed to buy securities of the par value of $146.535.000 to aid in financing construction of self-liquidating projects. As of that date 8400.000 of these securities had been purchased, and it 's expected that before Dec. 31 an additional $15,237,000 will be purchased and paid for. The 8400.000 of bonds purchased were of the Middle Rio Grande Conservancy District at Albuquerque, N. Mex.,at the agreed price of 90. making a cash disbursement of 8360,000. The additional 815,237,000 of bonds which are expected to be purchased before Dec. 31 are to be bought at par, which will bring total disbursements of cash to aid in financing self-liquidating projects to 815,597.000 The Corporation has also bid upon and been awarded $2,016.000 of the bonds of the Metropolitan Water District of Southern California and $50,000 (the entire issue) of the bonds of the city of Prescott, Ariz. These bonds will be taken up in the near future. The Corporation has agreed to buy $40.000,000 of the Metropolitan Water District bonds and will bid upon future offerings made by the district. Up to the close of business on Dec. 23 the Corporation had announced relief advances to 36 States and 2 Territories amounting to 893.677.746.22 and had paid out $76,358,888.69. Since then further advances totaling $10,028.197 have been announced, bringing the amount authorized up to 8103,705,943.22. Review of Operations of the Reconstruction Finance Corporation.—The Corporation was organized Feb. 2 1932. The Reconstruction Finance Corporation Act authorized it to acquire resources of $2,000,000,000, later increased by the Emeregency Relief and Construction Act to 83,800,000.000. Of this amount it had acquired 31,200.000.000 in cash up to the close of business on Nov. 30, all of which had been furnished by the Treasury of the United States. This financing had been accomplished by selling to the Treasury, as required by the Reconstruction Finance Corporation Act, the entire authorized capital stock of $500.000,000 and by borrowing $700.000,000 from the Treasury on notes. The notes thus far issued bear 3) % interest, and the Corporation had paid the Treasury 87,608,904.11 in interest up to the close of business on Oct. 31. An additional $2.309,999.91 accrued on the'Series A" notes during the month of November. but is not due. With the resources placed at its disposal by the Treasury the Corpora, tlo Nonv.ha0 3d engaged in the following operations up to the close of business of I. Under Section 2 of the Reconstruction Finance Corporation Act.— This section required the Corporation to make available to the Secretary of Agriculture up to $200.000,000, or 10% of the resources it was authorized to acquire under the Reconstruction Finance Corporation Act to be used by him to make loans or advances to farmers where emergencies existed as a result of which they wore unable to obtain loans in the usual way for crop production purposes in 1932. The Corporation paid over to the Secretary of Agriculture 875,000.000 in cash, out of which he made loans aggregating 864,204.503.06 to 507.632 farmers. These loans were made in every State except Rhode Island, and averaged 8126.48 each. Repayments received by the Secretary up to the close of business on Nov. 30 totaled $14,599,450.42. The Secretary of Agriculture had, on Nov. 30. returned to the Corporation $15,000,000 of the 875.000,000 in cash advanced to him. Section 2 authorized the Secretary to make only 'loans for crop production during tho year 1932' in cases where he might find an existing emergency making It impossible for farmers to obtain such loans. This arrangement was a temporary one and the Secretary was authorized to make loans for only one purpose, crop production. When Congress enacted the Emergency Relief and Construction Act in July of this year it authorized the Reconstruction Finance Corporation, by section 201 (c) of that act to furnish through the creation of a regional Agricultural Credit Corporation in each of the 12 Federal Land Bank Districts, wider credit facilities directly to farmcrs and stockmen. The Corporation was required to supply a minimum of $3.000.000 of capital to each of the regional credit corporations created by it, and for that purpose was authorized to use so much of the 3200.000.000 originally allotted to the Secretary of Agriculture as might be available. A Regional Credit Corporation has been created in each of the 12 Land Bank Districts, and their operations up to Nov. 30 are reviewed in Section VI. II. tinder Section 5 of the Reconstruction Finance Corporation Act.— Under this section the Corporation had authorized 9,322 loans $1,541,900,876.47 to 6.494 borrowers of the following classes:aggregating 7,326 loans aggregating $848,445,377.26 were authorized to 4,897 banks and trust companies that were in operation at the time the authorizations were made. $44.668,406.41 of this was subsequently withdrawn or canceled. $32,637,537.76 remained at the disposal of the borrowers and $771,139.433.09 was disbursed to them, of which 8213,693,147.65 had been repaid. 499 loans aggregating $50,035.759 were authoried to receivers and liquidating agents of 485 closed banks. 34,048,014.28 of this had been withdrawn or canceled, 89 347,431.12 remained to the credit of the borrowers and $36.640,313.60 had been disbursed to them, of which 319,894,154.19 had been repaid. 907 loans aggregating $94,794,770.43 were authorized to 826 building and loan associations. $3,273,179.05 of this wa withdrawn or canceled. $2,298,844.69 remained subject to call by borrowers and 389.222,746.69 had been disbursed to them in cash, of which $7,967,688.75 had been repaid. 139 loans aggregating $12,950,852.85 were authorized to 17 livestock credit corporations. $1,074.843.53 of this had been cancelled or withdrawn, 8213,073.33 remained at the disposal of borrowers and 811.662.935.99 had been disbursed to them, of which $2,414.674.30 had been repaid. 118 loans aggregating 878,553,200 were authorized to 95 insurance companies: $2,595.118.23 had been canceled or withdrawn, 813,233.489.88 Volume 136 Financial Chronicle remained at the disposal of borrowers and $62,724.5a1.89 had been disbursed to them, of which $3,833.538.55 had been repaid. 116 loans aggregating $3,393.968.93 were authorized to 14 agricultural credit corporations. $37,217.16 of this had been withdrawn or cancelled, $112,743.87 remained subject to call by the borrowers, and $3,244,007.90 had been disbursed to them, of which $716.489.63 had been repaid. Loans to Railroads. Ninety-five loans aggregating $328.519,202 were authorized to 56 railroads. $258.740 of this had been canceled or withdrawn, $66.594,265 remained at the disposal of borrowers and $261,666,197 had been disbursed to them, of which $11.714.562.71 had been repaid. The proceeds of loans authorized to railroads were to be used for the following purposes: For completion of new construction $47.746.483 For construction and repair of equipment and Dotsero Cutoff by Denver & Rio Grande Western RR 12,550,000 To pay Interest on funded debt.. 73,959,547 To pay taxes 19.606,946 To pay past due vouchers for wages, materials, &c 19,630,040 To pay principal of maturing equipment trust notes 20,660,513 To retire maturing bonds and other funded obligations 75,068,618 To pay loans from banks 37,788,900 To pay other loans 16,143,526 Miscellaneous 5,364.629 Total $328.519.202 The rate of interest on the aggregate of $12,550,000 authorized for construction and repaid of equipment and the Dotsero Cutoff was 5%, while all other loans authorized to railroads bore 6% interest. The 5% rate was made to encourage undertaking the work for which the loans were made and thus afford employment OP The cutoff to be constructed by the Denver & Rio Grande Western will shorten the distance between Denver and points west about 170 miles in addition to providing employment for 1,000 to 1,500 men for a period of 18 months to two years. It is estimated that about $2.500,000 of the $3,850,000 authorized will be paid out in wages. Work was commenced Nov. 11. Other loans made to stimulate employment are 3700.000 to the New • Haven to repair locomotives and freight cars; $2,000.000 to the Pennsylvania to build 1,285 new freight cars; $500 000 to the Central of New Jersey to repair locomotives, freight and passenger cars and marine equipment,$3,000,000 to the B.& 0.to be used ro repair and rebuild locomotives and freight cars and build 820 new gondola cars, and 32,500,000 to the New York Central to repair freight cars Among the $47,746,483 ofloans authorized for new construction work was one of $27,500,000 to the Pennsylvania to complete electrification of its lines between New York and Washington: 310,400,000 to the Cincinnati Union Terminal Co. to complete the union terminal facilities in Cincinnati; $4,400,000 to the New York Central for its improvements on the west side of Now York City and 33.031.000 to the Milwaukee to complete grade separation work in Milwaukee and track elevation in Evanston, Ill. The $73,959,547 of loans authorized to railroads to housed to pay interest on their funded debts was immediately disbursed by them to the holders of their securities—insurance companies, savings banks, private investors, trust funds and other owners of railroad bonds. The $19,606.946 authorized to pay taxes was immediately passed on by the borrowers and went largely to the support of State and local governments. The Corporation has received information from the borrowing roads showing the distribution by States of $17.941,276.40 of the amount lent to pay taxes; Alabama $450,920.56 Miseouri $756,384.01 Arkansas 1,310,773.52 Montana 12,058.09 103,879.72 New Jersey California 2,850.663.45 Colorado 254,800.00 New York 133,780.73 15,000.00 North Dakota Delaware 457,500.00 District of Columbia206.84 Ohio 175,419.71 Florida 7,948.44 Oklahoma 1,098.914.27 Georgia 873,804.59 Pennsylvania 425,290.11 Illinois 2,582,876.34 South Carolina 17.828.60 Indiana 424,330.15 Tennessee 412,073.83 Iowa 223,601.00 Texas 7.100.00 Kansas 704.075.84 Virginia 2,047.69 Kentucky 11,962.84 Wisconsin 163,000.00 Michigan 4.137,182.50 Minnesota 258,919.00 Mississippi 68,934.57 Total $17,941,276.40 Federal income taxes amounting to $25.994 were also paid by the borrowers out of money advanced for tax purposes The $19,630,040 authorized for payment of past due vouchers for wages, materials and supplies was immediately disbursed to those to whom the borrowing roads owed money for wages and goods furnished The amounts authorized to pay $20,660,513 of maturing equipment trust notes; to retire maturing bonds and other funded obligations, $75,068,818, and to pay off $16.143,526 of other loans, consisting almost entirely of secured notes. all passed or will pass into the hands of the owners of those securities—insurance companies, commercial and savings banks, foundations and trusts and individual investors. The $37,788,900 authorized to pay off or reduce loans from banks was authorized to 19 railroads. Much of the $5,364,629 authorized for miscellaneous purposes was used by borrowing roads to replenish working capital. Loans to Vfortgage Loan Companies, Joint Stock Land Banks, etc. Ninety-one loans aggregating 690.969,300 were authorized to 79 mortgage loan companies. $1.520,369.66 had been withdrawn or cancelled, $3.737,630.88 remained to the credit of borrowers and $85,711,309.46 had been disbursed to them, of which $8,113,604.11 had been repaid. Eighteen loans aggregating $4,772,000 were authorized to 13 Joint Stock Land Banks. $69.84 had been withdrawn or canceled, $2,860,803.07 remained at the disposat of borrowers and $1,911,127.09 had been disbursed to them, of which $50,559.37 had been repaid. Nine loans aggregating $29,000,000 were authorized to nine Federal Land Banks. $2,700,000 had been withdrawn or cancelled, $10,450,000 remained to the credit of borrowers and $15,800,000 had been disbursed to them. No repayments had been received. Four loans aggregating $472,466 were authorized to three credit unions; $32,348 had been withdrawn or cancelled and $440,098 had been disbursed to borrowers, of which $7,843 had been repaid. The following rates of interest applied to loans authorized under Section 5; Loans to open banks, 5)4%; loans to receivers of closed banks, 5%; loans to Federal Land Banks, 41 %; loans to railroads to create employment. 5%;loans to railroads for all other purposes, 6%; loans to building and loan associations, Livestock Credit Corporations, insurance companies, Agricultural Credit Corporations, mortgage loan companies and Joint Stock Land Banks, 5.te %. Applications received by the Corporation for loans from institutions authorized to borrow under Sect:on 5 of the Reconstruction Finance Corporation Act have declined steadily since April. which was the high point. The following table shows the number of applications made under that section during the last six months: 75 Nov. Oct. Sept. Banks and trust companies (in 462 484 515 eluding receivers) Building and loan associations_ __ _ 61 62 105 11 6 8 Insurance companies 15 14 10 Mortgage loan companies Credit loans Federal land banks 2 3 3 Joint stock land banks 21 14 Agricultural credit corporations— 12 10 19 Livestock credit corporations 7 14 7 10 Railroads (including receivers) Aug. July. June. 899 1,049 1,088 140 124 140 14 10 19 16 33 21 2 29 32 12 -§ 5 19 26 8 18 22 13 576 601 700 1.150 1,281 1.321 The total number of applications received in May was 1.320; in April, 1,527; in March, 1,176, and in February, 166. III. Under Section 1 of the Emergency Relief and Construction Act.— Up to the close of business. Nov. 30, the Corporation had made 376.777,306.22 available to 35 States and two territories to be used for relief of needy and distressed people. Cash disbursements up to Nov. 30 totalled $51,441,257.27. From Dec. 1 to 23. inclusive, the Corporation announced additional authorizations for relief purposes aggregating $16,900,440, and up to the close of business on Dec. 23 had made further disbursements of cash totalling 324.917.631.42. The total amount authorized to be made available to 36 States and two territories on Dec. 23 was $93,677,746.22, and the total amount of money disbursed pursuant to those authorizations as of that date was $76,358.888.69. Of the total amount authorized as of Dec. 23, $87.109.865.22 had been made available to 34 States and two territorics under paragraph (c) of Sectionl, which provides for reimbursement of the Federal Government by deductions from future Federal contributions to States to aid in constructing roads and $6,567.881 was made available to political subdivisions of flee States under paragraph (e) of Section 1, which provides for reimbursement of the Federal Government directly by the subdivsiions to which the advances wore made. The following amounts had been made available to States under subsection (c) as of Dec. 23: $528,704.00 New Mexico $90,800.00 Alabama 506,200.00 North Carolina 1,386,000.00 Arizona Arkansas 1,319,168.00 North Dakota 4,744,116.00 Colorado 1.102,135.00 Ohio 817,968.00 Florida 2,668,153.00 Oklahoma 238,528.00 Georgia 486,084.22 Oregon 12,835,538.00 Idaho 300,000.00 Pennsylvania 25,238,228.00 South Carolina 135,200.00 Illinois Indiana 1.775.404.00 South Dakota 720,795.00 Iowa Tennessee 789,036.00 Kansas 1,119,840.00 Texas 1,569,301.60 Kentucky 861,400.00 Utah 1.136.089.00 Louisiana 4,751,333.00 Virginia 1,490,887.00 Michigan 4,328.283.00 Washington 350,000.00 Minnesota 1,351,843.00 West Virginia 2,170,174.00 892,300.00 Wisconsin 8,304.770.00 Mississippi Missouri 1,158.118.00 Hawaii 307,435.00 Montana 507,738.00 Puerto Rico 360.000.00 Nevada 70,967.00 New Hampshire Total 667,420.00 $87,109,865.22 The following amounts had been made available under subsection (e) as of Dec. 23: Iowa: Blackhawk County, $30,000; Clay County. 37.400; Des Moines County. $10,000; Sioux County, $6,400; Webster County, $34.000; total. $87,800. Michigan: City of Detroit, $1,800.000; City of Flint, $296.000; City of Muskegon Heights. $20,000; total, $2,116,000. North Dakota: Bowman County, $4,500; Burke County, $8,160; Burleigh County, $8,100; City of Minot, $10,000; Davide County $7,700; Mercer County,$4,000; Mountrail County, $7,120; Ward County. $40,000: Williams County. $13,100; total, $100,680. Ohio: City of Alliance, $31,500: City of Canton, 5150,000; City of Cleveland, $760,000; City of Dayton, $112,500; City of Massilon, $34.000: City of Niles, $19,816; Cuyahoga County, $470,000; Lorain County, $131,245; Mahoning County, $326,440; Montgomery County. $400,000; Stark County, $334.900; Summit County, $240,500; Trumbull County, $177,500; total, $3,188,401. Washington: Grays Harbor County, $105.000; King County. $675,000: Pierce Conty, $190,000; Snohomish County. $105,000; total, 31,075.000. All advances for relief purposes, under both subsections (c) and (e) bear interest at 3%, that rate being fixed by Congress. IV. Under Section 201(a) of the Emergency Relief and Construction Act.— Up to the close of business on Dec. 23 the Corporation had announced agreements to purchase securities of $146,535,000 par value to aid in financing construction of self-liquidating projects. Pursuant to those agreements the Corporation has purchased 3400.000 of 51 % bonds of the Middle Rio Grande Conservancy District project at Albuquerque, N. Mex., at 90. The Corporation has agreed to purchase the district's bonds of the par value of $5,784,000. and further purchases Will be made from time to time as bonds are offered by the district. It is expected that before the close of business on Dec. 31. $7,000.000 of 5% bonds of the State of Louisiana and $6,000,000 of 5% bonds of the Public Belt Railroad Commission of New Orleans, will be purchased at par to provide funds for construction of a bridge across the Mississippi River at New Orleans. It is also expected that $2.327.000 of 5% City of Chicago Waterworks Certificates of Indebtedness will be purchased, at par. by Dec. 31 to provide funds for construction of a new pumping station in Chicago. The Corporation has also bid upon and been awarded 32.016.000 of 5% bonds of the Metropolitan Water District of Southern California, at par. It has agreed to bid par on $40,000,000 of these bonds and to purchase that amount if higher bids are not received from other sources. In accordance with that agreement bids will be made upon further offerings by the district. It has also bid upon and been awarded $50,000 (the entire issue) of 5% bonds of the City of Prescott, Ariz., at par. It is expected that these awarded bonds will be taken up shortly. In the case of other commitments of the Corporation to finance construction of self liquidating projects the purchase of bonds is awaiting request by the applicants, the working out of legal details, the taking by applicants of action necessary to authorize issuance of their bonds, and similar prerequisites to actual advancement of funds. V. Under Section 201(d) of the mergency Relief and Construction Act.— As of Nov. 30 the Corporation had authorized eight loans to six borrowers under this section aggregating 352,104.357.23 to finance the carrying and orderly marketing of agrigulturat commodities produced in the United States. $135,111.94 of this amount had been canceled or withdrawn, $50.687.388.20 remained at the disposal of borrowers, $1,281,857.09 had been disbursed to them in cash of which $5,575.55 had been repaid. The names of the institutions to which these loans were authorized have been published from reports submitted to Congress, and are repeated here: Cotton Stabilization Corporation, $15.000.000: American Cotton Cooperative Association. 535,000,000; Sun Maid Raisin Growers of Cali$1,500.1)00: Growers' Fruit Exchange (West Virginia). 3175.000: Financial Chronicle 76 Canners' Finance Corporation (Ohio). $147,499.60; Shade Tobacco Credit Co. (Florida), $146,745.69; cancellation, noted above, $135.111.94; total, $52,104,357.23. These loans were authorized at 5 % interest. V/. Under Section 201(e) of the Emergency Relief and Construction Act.— The Corporation has created a Regional Agricultural Credit Corporation in each of the 12 Federal Land Bank Districts, with 21 branch offices. These regional corporations are making loans directly to farmers and stockmen for agricultural purposes, including crop production and the raising, breeding and fattening of livestock. Individuals and partnerships only are eligible for loans. Corporations are ineligible. Section 201(e) requires the Corporation to furnish each regional corporation with a minimum of $3,000,000 in capital, which may be increased if necessary. The capitalization of four corporations (those in the eighth, ninth, eleventh and twelfth land bank districts) has been increased to $5,000,000. The first loan by a Regional Credit Corporation was made on Oct. 8, and up to the close of business on Nov.30 $8,610,081.96 had been disbursed to 2,253 farmers and stockmen and repayments from five borrowers amounting to $37.744.17 had been received. As of Dec. 23. $19,800,392.44 had been disbursed to 5,786 borrowers; 17.336 applications totaling $41,924,102.69 had been approved upon which disbursement had not been made; and 31,732 applications for loans totaling $65,433.338.49 were awaiting action. Reports of repayments subsequent to Nov. 30 have not been received. Monthly Report of Railroad Credit Corporation— Loans of $47,114,632 Advanced or Authorized Up to Dec. 31. According to the monthly report (dated Dec. 31) of the Railroad Credit Corporation, filed with the Inter-State Commerce Commission, that Corporation had either actually made or authorized loans to railroads to meet their fixed interest obligations totaling $47,114,632. Of that amount, $46,931,732 represented loans actually made, leaving a balance of $182,900 to which the Corporation is committed. Reported rate increases under Ex Parte 103, according to the report, totaled $52,201,092 in the first 10 months this year, and amounted to $5,981,462 in October. In a letter addressed to chief executives of participating carriers and accompanying the report, E. G. Buckland, President of the Railroad Credit Corporation, said: The rate increases authorized in Ex Parte No. 103 became effective, generally, in January 1932. The payments into the Corporation's fund to Dec. 31 1932 represent earnings derived from the increased rates by participating carriers through October 1932. As to loans. 57 railroads applied for loans in the aggregate sum of $105,990,446, of which $55.364,408 was removed from the docket as being receivable from some other source, and(or) denied; $48.324,919 has been approved, and pending applications total $2,301,119. Resources. Emergency revenues reported by participating carriers Accrued interest Proceeds from sale of capital stock Total Loans Less repayments $52,201.092 466.227 1,200 $52,668.519 Application $48,142.019 1.210.287 Net outstanding Cash reserved for tax payments, &c Accounts receivable and accrued items Expense of administration $46.931,732 4,560.640 639.140 136,845 Total Balance Loan commitments $52,268,357 400,162 182.900 Available working fund $217,262 The Railroad Credit Corporation Report to Inter-State Commerce Commission and Participating Carriers As of Dec. 31 1932. Assets— Investment in affiliated companies—Loans made $46,931,731.50 Cash 400,162.21 Petty cash fund 25.00 Special deposit—Reserved for taxes, &c 4,560,640.11 MIscell. accts. receivable—Due from contributing carriers 376,264.51 Interest receivable 183.387.55 Deferred assets—Loans authorized—contra 182,900.00 Unadjusted debits 79.463 83 Total $52,714,574 71 Liabilities— Non-negotiable debt to affiliated companies—Reported rate increases under Ex Parte 103 $52,201,092.31 Deferred liabilities—Loans authorized—contra 182.900.00 Unadjusted credits 329,382.40 Capital stock 1,200.00 Total $52,714,574.71 Three Additional Roads Receive Loans Aggregating $4,021,000 from Reconstruction Finance Corporation—$2,500,000 to Missouri Pacific and $1,500,000 to Seaboard Air Line—Commission Requests Missouri Pacific to Submit Plan Providing for $34,548,000 River and Gulf Bonds due May 1 Next. The Inter-State Commerce Commission on Jan. 4 approved loans aggregating $4,021,000 to threo railroads from the Reconstruction Finance Corporation; viz: $2,500,000 to the Missouri Pacific RR., $1,500,000 to the Seaboard Air Line Ry. and $21,000 to the Toledo Angola & Western Ry. This brings the total loans approved to date by the I.-S. C. Commission to $359,035,678 to 76 roads. The Missouri Pacific previously had secured three loans aggregating $17,100,000 from the Reconstruction Finance Corporation and in the case of the Seaboard Air Line Ry. a previous Jan. 7 1933 application for t loan of $3,000,000 had been denied. The Commission, as a condition approving the Missouri Pacific loan, stated that "we shall expect the applicant within a reasonable time to formulate and present for our consideration a plan to meet the May 1 maturity" of the $34,548,000 St. Louis Iron Mountain & Southern Ry., River & Gulf 50-year first mortgage 4% bonds. Details in connection with the loans now approved follow: Missouri Pacific RR. The original application in this proceeding was filed by the Missouri Pacific RR. on Jan. 29 1932. The amount of the loan then sought from the Reconstruction Finance Corporation was $23,250,000 for certain specified purposes. The application was supplemented March 10 1932, and March 17 1932, to meet the requirements of the Reconstruction Finance Corporation and to increase the total loans applied for in the original application by $1,400,000. The aggregate loans sought by the applicant thus became $24,650,000. Under dates of Feb. 10, Feb. 23 and March 23 1932, we certified our approval of loans of $1,500,000. $2.800,000 and $12.800.000. respectively, without prejudice in each instance to consideration of further loans upon the application. These loans aggregating $17,100,000 have been made by the Finance Corporation and are secured by the pledge of collateral consisting of: $22,250,000 Missouri Pacific 1st and refunding, series I, 5s of 1981. 1,900,000 New Orleans Texas & Mexico 1st 43,6s of 1956. 1,000,000 Denver & Rio Grande Western refunding and impr. Gs of 1974. 11,475.000 Common stock of Texas & Pacific Ry. 160,000 Common stock of Fort Worth Belt By. In addition to loans by the Finance Corporation, the applicant has borrowed from the Railroad Credit Corporation a total of $3,800,000 for interest requirements, and that Corporation has loaned to the InternationalGreat Northern RR. $750,000 and has approved a further loan of $400.000 to that carrier. The total of advances by the Railroad Credit Corporation to the applicant and its subsidiary is thus $4,950,000. On Dec. 17 1932,the applicant filed an amendment to the original application requesting a further loan under the provisions of the Reconstruction Finance Corporation Act, approved Jan. 22 1932, as amended. The Amended Application. The applicant seeks a further loan of $4,300,000 for a period of three years for the purpose of paying taxes and of assisting the applicant in meeting interest and principal payments on equipment trust obligations and certain mortgage bonds due in the near future. The requirements of the additional loan as set forth in the amended application are as follows: Amount of Loan On or Before Dec. 30 1932— Requested. To pay taxes amounting to $1,908,000 due not later than Dec. 31 1932 $1,900,000 On or Before Jan. 13 1933— To most principal payment on applicant's equipment trust, ser. 41, of $693,400, due Jan. 15 1933 600,000 On or Before Jan. 311933— To pay the following obligations due Feb. 1 1933: Principal. Interest. Pacific RR. of Missouri 1st mtge. bonds $139.920 Missouri l'ac. 1st & ref. mtge. bonds, series A 446,013 Missouri Pac. 1st and ref. mtge. bonds,series I_ 1,530,000 Plaza-Olive Bldg. 1st mtge. bonds $1,875 4,045 Equipment trust certificates, series A 153,000 19,890 $154,875 $2,139,868 Total principal and interest $2,294,743 In its original application and in its supplemental application of March 17 1932, the applicant represented that it was unable to ootain the necessary funds requested in whole or in part from any other source. In the present amendment to the application it asserts that this situation remains the same as previously stated. Necessities of the Applicant. In addition to the above-stated amount of $4.300.000 to meet requirements to and including Feb. 1 1933, the applicant will be faced with the necessity of providing cash to most normal requirements to and including Dec. 31 1933, of $11,200,00. including similar requirements of the New Orleans, Texas & Mexico Ry. and the International-Great Northern RR. On May 1 1933, there will mature $34,548.000 of St. Louis Iron Mountain & Southern Ry., River & Gulf, 50-year first mortgage 4% bonds. These bonds are a first lien upon 781.47 miles of the applicant's system, including its principal low-grade freight line from Valley Junction to Thebes, Ill., its White River Division from Carthage, Mo., to a point near Batesville, Ark., and other mileage along the west bank of the Mississippi River from a point near Helena. Ark., to a point near Ferriday, La. They are also a first lien upon certain equipment and upon the first mortgage bonds of the Union Railway (of Memphis) and of the Western Coal & Mining Co. Under the applicant's first and refunding mortgage there is reserved a like principal amount of bonds available tbr refunding the River & Gulf 44. The applicant has filed with its amended application a statement of its cash position by months on an actual basis from January to October 1932 inclusive, and on basis of carefully prepared estimates for the period Nov. 1 1932 to Juno 1933. inclusive. At our request the applicant has also filed an additional monthly cash forecast for the last half of 1933. The estimates for the months of November 1932 to July 1933. inclusive, were prepared upon the assumption that traffic and earnings would continue, with seasonal variations, at about the present levels which are substantially lower than those experienced in the first half of 1932. Beginning with August 1933, a continuing moderate increase In these levels has been anticipated. The estimates also anticipate continuance of the emergency increases In freight rates authorized in our decisions in Fifteen Per Cent Case. 1931, 178 ICO 539, 179 ICC 215, and the retention by the applicant subsequent to March 31 1933 of the revenues derived from such increases. In the matter of non-operating income the estimates contemplates practically no receipts from dividends or interest, except such interest on advances to subsidiary companies as is being currently paid. Borrowings for applicant's requirements, including those covered by the present amendment to the application, are included in the total estimated receipts. No estimated cash requirement is shown in respect of the maturity of May 1 As to disbursements the forecast is made upon the assumption that payrolls will continue to reflect wages at current levels. Taxes are estimated to require slightly less cash outlay than during 1932. Estimated interest requirements include payments on all present and prospective borrowings, including loans from banks, the Railroad Credit Corporation and the Reconstruction Finance Corporation. Vouchers have been estimated to require cash expenditures at approximately the same rate as in 1932 and include payments due under contracts for purchase of stocks of certain terminal and land companies entered into in 1930. Payrolls and vouchers include estimated expenditures for a minimum program of additions and betterments at a rate slightly less than the experience of 1932. Intercompany transactions required to maintain minimum cash working balances Volume 136 Financial Chronicle with the several operating units of the system are forecast at approximately the same rate as in 1932 The cash balance at the end of October 1932, the latest month for which the actual figures are available, was $1,309,000. November with estimated borrowings of $200,000 ends with an estimated cash balance of $1,421,000. In December the estimate includes the item of $1,900.000 as the proceeds of the loan from the Reconstruction Finance Corporation covered by the present application and, per contra, a corresponding increase in tax vouchers. The cash balance at the end of 1932 is estimated to be $800.000. Similarly, through the months of 1933 estimated borrowings are so distributed in relation to cash requirements that the monthly balance of cash on hand is maintained at an average of approximately $1,000,000. At the end of 1933 the cash balance is estimated at $787,000. As previously shown, the total loans from the Railroad Credit Corporation and the Reconstruction Finance Corporation, including the item of $1,900.000 for Dec. 31 covered by the present application, amount to $23,950,000. Included in this sum is the item of $5,850.000 advanced by the Reconstruction Finance Corporation, with our approval, to meet 50% of bank loans due April 1 1932. The remainder, $18,100,000 represents the applicant's total borrowings of new money in 1932. Its cash forecast for 1933 includes estimates of new borrowings aggregating $13,600,000, including the two items totaling $2,400,000 covered by the present application. Thus the borrowings of new money in 1932 exceeded by $4,500.000, the estimated borrowings of new money in 1933, exclusive, of course, of the May 1 maturity of the River & Gulf bonds. The maturity of the River & Gulf bonds represents not only the largest financial requirement in 1933, but by far the applicant's largest maturity until 1949. In addition, the other 1933 requirements, except those for which we may provide in this proceeding, place upon the applicant in the near future the necessity of providing substantial financial resources in some form. In connection with any loan which we may approve upon the present application we shall expect the applicant within a reasonable time to formulate and present for our consideration a plan to meet, the May 1 maturity. Security. For the additional loan now sought and for the existing loans, as well as for any further loans which we may approve upon the application, the applicant offers as security (a) Assignment to the Reconstruction Finance Corporation of advances by the applicant to its controlled companies, the New Orleans Texas & Mexico Ry. and International Great Northern RR., in the approximate amounts of $9,955,000 and $2,486.000, respectively, a total of $12,441,000. (b) $10,000,000 (or such greater principal amount as we may approve) of the applicant's first and refunding mortgage 5%,series I bonds of 1981 which we may authorize upon proper application under Section 20(a) of the Inter-State Commerce Act. The collateral securing existing loans of $17 100.000 by the Reconstruction Finance Corporation has been hereinbefore described. This consists principally of 5%,series I, bonds of 1981 issued under the applicant's first and refunding mortgage which is a direct first lien upon 5,575 miles of the applicant's system and, subject to $52,599,500 of divisional mortgages, is a first lien upon the remaining 1.208 miles. Moreover, it is a first lien upon $23,703.000 of preferred stock of the Texas & Pacific Ry.—one of the few class I carriers which will earn their fixed charges in 1932. These bonds are currently quoted on the New York Stock Exchange at around 19. Within two years these bonds have sold on the same Exchange at par. A block of $61,200,000 of these bonds was distributed in March 1931, at 95. During the period since 1925 to date the price has ranged as high as 104, and the average market price over that period has been in excess of 85. In 1932 the applicant earned approximately 71% of the interest requirements on its first and refunding bonds outstanding in the hands of the public. The next most important item of the collateral securing existing loans consists of $11.475,000 of the common stock of the Texas & Pacific Ry. This stock is also listed on the New York Stock Exchange where it is currently quoted 15 bid, 20 asked. This is the stock which in 1928 sold at 194%. and has had an average price on that Exchange in the last eight years of84%. The $1.900,000 of New Orleans Texas & Mexico first 4;is of 1956 are currently quoted on the New York Stock Exchange at around 20. These bonds sold on the same Exchange as high as 100% from date of issue in 1927. The average price to date has been 76. Until 1930 these bonds were legal Investments for savings banks in the State of New York. The 5% series B bonds of 1978, issued under Denver & Rio Grande Western refunding and improvement mortgage are listed on the New York Stock Exchange where they are currently selling at around 17. Since their Issue in 1928 they have sold on the same Exchange as high as 95, and the average price since listing has been 68k. The bonds under this mortgage which are pledged as security for the loans carry a 6% coupon which justifies a higher market rating than that of the 58 The advances aggregating approximately $12,441.000, upon which interest 18 being currently paid at the rate of 6% per annum, represent open account indebtedness to the applicant by two of its controlled companies accumulated over a period of five years. All of these advances were used to pay for additions and betterments to the properties, except that during the last two years certain of the advances to the New Orleans Texas & Mexico Ry. were made to overcome operating deficits. In the case of both of the controlled companies the obligations to repay the advances lie between their first mortgage bonds and their capital stock. In the case of the International-Great Northern RR. they are senior as to the payment of interest on $17,000,000 of adjustment mortgage bonds, but junior to that bond issue as to security. We have shown the current and long-term market quotations of the first mortgage, 434% oonds of the New Orleans Texas & Mexico Ry. The capital stock of that carrier, of which there is but one issue, is currentl, quoted at around 16, with a price range for eight years to a high of 159 and an average price over that period of 114%. On basis of the current market quotations for the stock and bonds of the carrier the advances to it by the applicant bearing 6% interest would appear to have a comparable market value of about 24% at which the total advances to that carrier would have a value of approximately $2,400,000. Because its entire outstanding issue of capital stock is owned by the New Orleans Texas & Mexico By. it is impossible to make a similar computation of value for the advances to the International-Great Northern RR. The assignment of advances by the applicant to its controlled companies and the pledge of additional bonds which we may authorize to be issued for the purpose under the applicant's first and refunding mortgage will improve the security for the total reconstruction loans to the applicant. Conclusions, We conclude: 1. That we should approve a further loan of not to exceed $2.500,000 to to the applicant by the Reconstruction Finance Corporation, for a period not exceeding three years from the making of the advances thereon, for the purpose of paying taxes and the principal of equipment trust obliga- 77 tions, due Dec. 31 1932 and Jan. 15 1933, respectively, as hereinabove more fully described: 2. That the applicant should deposit with the Reconstruction Finance Corporation as security for the loan! (a) Pledge of $10,000,000, principal amount, of the applicant's first and refunding mortgage, series I, 5% bonds of 1981. or such other principal amount of such bonds as we may authorize to be issued for the purpose. (b) Pledge of $93,200. par value, of the capital stock of the American Refrigerator Transit Co. excepting therefrom such shares thereof as may be required to qualify directors. (c) Pledge of $75,000 principal amount, of the first mortgage, 6% bonds of the Prescott & Northwestern RR. of Oct. 1 1934. (d) Assignment of advances by the applicant to its controlled companies, the New Orleans Texas & Mexico Ry. and International-Great Northern RR.,in the approximate amounts of$9.955,000 and $2,486,000,respectively, a total of $12,441,000, which assignment should be in form satisfactory to the Reconstruction Finance Corporation. 3. That the applicant should agree with the Finance Corporation that all of the security for this and any other loan by that Corporation to the applicant shall apply equally and ratably as security for all of such loans. Seaboard Air Line Railway. Legh R. Powell Jr. and Ethelbert W. Smith, receivers, on Nov. 1 1932 filed this application to the Reconstruction Finance Corporation for a loan under the provisions of Section 5 of the Reconstruction Finance Corporation Act, approved Jan. 22 1932, as amended. This is the second application of the receivers for a Reconstruction loan, and it incorporates by reference much of the data supporting the previous application. The earlier application was for a loan of $3,000,000 for purposes similar to those for which the present application is filed. By our report and order of Sept. 21 1932, the earlier application was denied. The Application. The application now before us requests a loan of $1.500,000 for a term of three years, the proceeds to be applied in payment of certain claims which have been adjudged by the court having jurisdiction of the receivership to be entitled to priority of payment. The applicants were authorized by order of the court dated Oct.31 1932,to seek a loan from the Reconstruction Finance Corporation of the foregoing amount, the proceeds of which will be "employed toward the discharge of priority claims which have been finally adjudged to be entitled to priority." The application sets forth that owing to the uncertain general business situation the receivers do not know whether it will e reasonably possible for them to repay the loan sought within a shorter period than three years. The receivers state that notwithstanding earnest efforts they have been unable to procure funds for these purposes from any other source: that their banking credit is exhausted and that they are unable to dispose of receivers' certificates to the general public. The applicants are ineligible to become parties to the "Marshalling and Distributing Plan. 1931" of the Railroad Credit Corporation and can not, therefore, procure loans from that Corporation. Necessities of the Applicant. The loan is desired to discharge preferred claims of 1,134 separate creditors of the railroad company, aggregating $1,446,921 for various services and supplies These are part of a total of an estimated amount of $3,500,000 of such claims which have been or will be submitted to the special master for approval. Claims approximating $2,800,000 are expected to be granted priority by the court. Accompanying the application are copies of letters from some of the claimants showing urgent need for the immediate payment of their accounts. These are said to be but a few of many hundreds of such letters which have been received by the applicants. All of the claims are alleged to have arisen during the six months prior to the inception of the receivership and are now of approximately two years' standing. In our previous report we found the receivers to be in possession of cash in an amount exceeding the aggregate of these claims. A statement of cash receipts and disbursements filed with the present application shows that at the close of October 1932, after setting aside $1,500,000 as the minimum cash working oalance necessary to be kept available for the use of the receivers at all times, the receivers expected to have in their treasury $3,737.986. Thereafter necessary disbursements are shown so to exceed anticipated receipts, including as a cash reserve $150.000 per month chargeable to operating expenses for depreciation, that at the close of the year 1932 the cash balance,less the working balance,is expected to be $3,409,577. Assuming that railway operating revenues thereafter will be sufficient to meet all railway operating costs entering into the computation of net railway operating income, the applicants expect to have $2,464.100 in cash on hand Dec. 31 1933, and $1,141,762 on Dec. 31 1934, in addition to the working balance, without taking into account any payments in respect of preference claims. The estimate of cash on hand Dec. 31 1934, thus exceeds by $580,684 the estimate for the same date when the previous application was filed. The increase results in part from the return to the applicants of $106.000 deposited with the fiscal agents of the railway company for the payment of interest on bonds issued under general mortgages for which interest coupons have not been presented:from a decrease in the applicants' material and supply account: and fr.om increases over the estimated results of operations for 1932. Nevertheless, in view of the uncertainty of business conditions in the immediate future, the receivers consider It inadvisable to deplete their cash to an extent necessary to meet all preference claims. Instead, It is contended, they should remain sufficiently fortified with cash to insure their ability to properly maintain their property, make necessary additions and betterments thereto, meet their fixed charges, and insure continued operation. The receivers' plans contemplate the payment in full with the proceeds of the loan of all claims now adjudicated, as aforesaid. By such payment they would be committed to the payment of all similar claims hereafter approved by the court. They have filed a supplemental statement expressing their intention to meet all claims upon their adjudication, but indicate that no further loan for this purpose will be sought from the Finance Corporation, unless a change in the present economic situation appears to endanger their ability properly to continue the maintenance and safe operation of the railroad. This is an undertaking to provide cash in excess of the $1,500.000 now sought to meet preferred claims, if economic conditions remain unchanged, which is a different proposal from that presented to us In the previous application. Security. As security for the proposed loan the receivers offer to pledge their certificates of indebtedness, series E,in principal amount or amounts equal to the loan received, such certificates to be dated as of the date of issue, to mature Feb. 1 1937. and to bear interest at the rate of 6% periannum, payable, however, only when and to the extent there shall be defaultlin the payment of interest on the loan. The certificates will contain provision for the acceleration of their maturity in the event of the entry of any decree in the receivership proceedings the effect of which would oe to enforce the lien of other receivers' certificates now outstanding. Any loan which we may approve should also be conditioned upon a similar right in:the Reconstruction Finance Corporation to declare acceleration of the maturity 78 Financial Chronicle thereof in its discretion, upon the same contingency. These certificates are similar to those offered in the first application. Their proposed maturity post-dates the maturity of any loan which we may now approve. Previous loans by the Reconstruction Finance Corporation to the receivers of railroads which we have approved have generally been evidenced or secured by receivers' certificates having a maturity daze coinciding with the maturity date of the loan itself. No satisfactory reason is given for a departure from that practice in this case. The receivers' certificates when and if issued will possess a general Hen upon the fixed physical property and the income of the receivers ratably with $15,038,000 of receivers' certificates maturing Feb. 1 1935. previously authorized to be issued, a part of which, however, possess priority of lien against certain equipment. The collateral offered would be junior in lien to $32,315.000 of bonds issued under divisional mortgages upon which, by agreement, interest will accumulate without payment until Feb. 1 1935, when the total amount ofsuch interest then to on paid or funded will amount to 35,836.500. As of Oct. 31 1931, the railroad company, predecessor of the applicants, had $23,304,000 of equipment trust notes outstanding. In the refinancing plan now in process of execution the receivers propose to exchange $10.558,000 of receivers' certificates, being a part of the $15,038,000 of certificates referred to above, for an equal amount of the equipment notes, which will leave $12.746,000 of such notes outstanding in the hands of the public. This plan has been partly consummated. The series E certificates will be junior to the lien of the equipment notes which remain outstanding. They are also represented to be junior to certain miscellaneous liens aggregating $1,225,000 as of Sept. 30 1932, and to existing and future liens for taxes and assessments. These certificates are shown to have a direct first lien upon 1,001 miles of road and a direct second lien, subject to the aforesaid underlying divisional mortgage bonds, upon 2,421 miles of road. In our previous report we discussed the results of operations of the property in 1931 and 1932 and showed that upon the basis of the record then made, the applicants had failed to earn fixed charges in 1931 and on the basis of estimates would similarly fail to earn them during 1932. In the period from 1924 to 1929, during all of which the railroad company earned its fixed charges, the annual net railway operating income averaged $10,543,388. This, the receivers maintain, is more truly indicative of the normal earning power of the property than the results of 1931 and 1932. They show that in the current year unit costs have been greatly reduced. Applying the costs now obtaining to the units of labor, material and supplies, and to taxes (exclusive of taxes based on income) and rents. In 1930 and 1931, the receivers estimate that there would have been decreases of at least $4,335,000 and $3,448,000, respectively, in the operating expenses and taxes of those years. From this the receivers assume that when gross revenues again approximate tho.e of 1930 or 1931 tne net railway operating Income will substantially exceed that of those years. The receivers also direct our attention to tne substantial decrease in the railway company's fixed charges incident to the receivership. All of the company's general mortgages are in process of foreclosure and interest thereon is not now required to be paid. The company formerly used the property of a large number of affiliated and other carriers under lease, for which it paid stipulated rentals. The receivers have adopted but few of these leases. Whereas the accruals of rent for leased roads exceeded $2.000,000 in 1927. 1928, 1929 and 1930, such accruals in 1931 had been reduced to $807,761, of which amount the applicants considered they were required to pay and did pay but $155.511 and in 1932 will pay only 3116.245. Including interest upon their debt, exclusive of the proposed loan, and the rents for leased roads which they classify as necessary fixed charges, the receivers show that in 1932 the total disbursement for these purposes will be $1,651,995, and thereafter, until the end of 1935. will not exceed $1,668.477. Adding to this the interest on underlying bonds, which is being deferred, the receivers show that their total liability for rent for leased roads and interest in 1931 was $3,159,481 and in 1932 will be $3,227,245. Under these conditions a comparatively small recovery in the applicants' business should enable them to earn these fixed charges. From 1921 to 1929, inclusive, gross revenues averaged $55,692,677. In 1932 the gross revenues are estimated at $30,801,355. In our previous report, in showing the sum which would be available to meet interest in 1931 and 1932. we included in the computation the aggregate accruals for rent for leased road Eliminating that portion of this item which will not be paid, the receivers show that in 1931 they had available $3,021,125 for the payment of rents for leased road and interest, aggregating $3.159,481, after the debit in operating expenses of $1,938,740 for depreciation, and that to meet similar fixed charges in 1932 of $3,227,245. they will have available $592,609 after deducting $1,799,000 for depreciation. Thus, they assert that there was ample cash from operations in 1931 with which to meet their fixed charges and that in 1932 there will be $2,391,609 applicable thereto. The receivers estimate that the total corporate claims which will have been adjudicated to have the priority status will amount by the end of 1933 to $2,500,000. The receivers are faced with the necessity of conserving their cash resources to meet the ordinary demands upon them growing out of their operation of the property in a safe physical condition. They must also insure the preservation of their credit by the punctual payment of interest when due upon their outstanding receivers' certificates. For these reasons the receivers are convinced that not more than $1,000.000 of their cash resources should be diverted to the payment of preferred claims. As previously shown, the estmated cash balance of the receivers at the end of 1934, after providing for only the ordinary cash requirements, and without provision for payment of preferred claim/is, would amount to $1,141.762 after allowing for minimum cash working balance of $1,500,000. Giving effect to the proposed disbursement of cash on account of preferred claims, the cash balance of the receivers at the end of 1934 would be reduced to a point where only approximately $141,700 would be available to meet extraordinary requirements for emergencies which might arise from operations. The receivers are thus confronted with the necessity of borrowing from the Reconstruction Finance Corporation as their only source of credit a minimum of $1,500,000 for the payment of preferred claims, being 60% of the estimated total of such claims. The need among the claimants for prompt discharge of their claims is Very great, in many instances the creditors themselves, because of the depressed condition of general business, being threatened with insolvency. The payment of these claims will effect the widest distribution of funds through a great variety of industrial concerns many of which are either patrons of the railroad or the source of material and supplies consumed in its operation, or both. Payment of these claims at this time should enable the receivers to effect a substantial saving in interest which might accrue on the claims if permitted to remain unpaid for a considerable time. Conclusions. We conclude' 1. That we should approve a loan of not to exceed $1,500.000 by the Reconstruction Finance Corporation, to the receivers of the Seaboard Air Line Ry. for a term not exceeding three years from the dates of the ad- Jan. 7 1933 vances thereon, for the purpose of providing funds to pay preference claims which have been approved by the court, the remainder of such claims to be paid by the applicants with cash from other sources; such loan to be secured or directly evidenced by receivers' certificates of like principal amount possessing a lien upon the income and assets of the receivers ranking equally with the lien of receivers' certificates heretofore authorized, other than such certificates which have a specific lien upon equipment, as aforesaid. 2. That the loan should be made subject to the right of the Reconstruction Finance Corporation to accelerate the maturity thereof in the event of any decree in the receivership proceedings the effect of which would be to enforce the lien of any other receivers' certificates now or which hereafter may be outstanding. Commissioner Mahaffie, dissenting, states: On Sept. 21 1932, Division 4, as then constituted, denied approval of an application for a loan of $3,000,000 to pay these claims. We pointed out that the Seaboard is in default on loans made by the United States for its benefit under Section 210 in the amount of approximately $17,825,651. There appears to be no prospect of the payment of any substantial part of that indebtedness. The receivers have been authorized to issue $15.038,000 of certificates. Divisional mortgages having liens on the property covered by them prior to the certificates amount to $32,315,000. Interest on the bonds secured by these mortgages Is not being paid. Of the principal of these liens, $12,025,000 will mature prior to Feb. 1 1935, the date to which payment has been deferred. Dcferred interest on these bonds on that date will be about $5,835,000. These obligations having priority or equality with receivers' certificates now outstanding, and those accepted by the majority as security, present grave obstacles that must be met in any refunding operation in 1935. Net railway operating income of the receivers for the first 10 months of 1932 was 877,562. There is presented no ground for hope that the receivers' certificates can be paid out of earnings. The claims proposed to be paid in part with the money to be borrowed are for materials, &c., furnished the company prior to receivership. Of course, it is desirable that such claims be paid, and that all other legitimate debts of the company be paid also. But I see no reason for these claims being singled out for payment out of Government funds. The court, it is true, has found that they are preferred claims. In substance tha establishes the right of the holders to be paid in advance of the claims of other creditors, and no doubt they will be whether the loan be made or not. Presumably the court will direct that they be paid as soon as that can safely be done out of assets under its jurisdiction. I doubt if a loan to enable payment in advance of that time is of the character of "emergency financing' contemplated by the Act. The applicants now have in their possession cash more than adequate to pay these claims in addition to what are represented to be necessary working funds. The theory of this application and of the majority action is that the cash on hand should, in the main, be held as a reserve for future requirements. If earnings continue as low as at present, such a reserve may be needed in order to pay when due the accruing interest on certificates. That emergency is not a present one. And whether or not It occurs depends not only on the course of earnings of the property but on the extent to which the receivers use the) cash now on hand to meet these claims. More important than the question whether this is such an emergency as Is contemplated by the Act, as I view it, is the question of security. In view of the earnings of the property and the claims that must be met prior to or concurrently with the payment of the certificates offered as collateral, I am unable to join in the finding that the loan will be adequately secured. Toledo Angola & Western Railway. The Toledo Angola & Western fly. on Nov. 15 1932, filed an application with the Reconstruction Finance Corporation. The Application. A loan of $36,000 is requested by the applicant, for a term of three years from the date of advances thereon, with the privilege of partial payments, as it may have funds available, in amounts of $5,000. The proceeds of the loan are proposed to be used in meeting the following obligations: Indebtedness for coal, material and supplies $4,662.10 Ohio excise tax, due Dec. 15 1932 1,741.44 Bank indebtedness (note) due Dec. 27 1932 10,000.00 Property tax, half due Dec. 20 1932 3,178.70 Property tax, half due June 20 1933 3,300.00 Bond interest due Jan. 1 1933 6,351.00 Bond interest due July 1 1933 6,351.00 Total $35,584.24 It is the desire of the applicant that $28.000 of the loan be made available by Dec. 27 1932, and the remainder on or before July 1 1933. In August 1931 the depositary of the applicant and four other roledo banks were taken over by the Ohio Superintendent of Banks. At that time the applicant had In excess of $6,000 on deposit with its bank. To provide for pressing necessities, temporary financing arrangements were made with a Cleveland bank. The applicant states that applications for funds have recently been made to the successor of the Toledo depositary and two Cleveland banks, but those institutions were unwilling to make loans in amounts sufficient to meet the applicants' needs. On Nov. 20 1931. we issued a tentative recapture report pursuant to Section 15a of the Inter-State Commerce Act in which the excess net railway operating income of the applicant for the calendar years 1924 to 1927, inclusive, was determined to have been $145,674.09. The applicant was directed to pay one-half of this amount to us but has made no payments, nor has it pledged any securities for the indebtedness. Protest has been flied against our tentative finding and proceedings thereunder are now pending. The applicant is not a party to the "Marshalling and Distributing Plan, 1931" of the Railroad Credit Corporation, due to the smallness of the amounts realized and for the further reason that it requires all monies received from all sources in keeping its property functioning. During the first 10 months of the calendar year the applicant derived $2,213.40 of revenue from the emergency increases in freight rates and estimates that $300 will be derived from this source during the remaining two months of 1932. Necessities of the Applicant. There are included in the total loan of $36,000 requested by the applicant the sum of $4,662 representing overdue balances for coal, material and supplies; excise and property taxes of $4,920 due in December 1932; interest of $6,351, due Jan. 1 1933. on the applicant's first mortgage bonds: and a $10,000 note held by a Cleveland bank, maturing Dec. 27 1932. The note is a 90-day obligation originally executed June 27 1932, and renewed at maturity. It is secured by $20,000 of the applicant's first mortgage bonds, one-half of which bonds, or $10,000, the applicant states will be released immediately by the Cleveland bank upon payment of $5,000 of the applicant's indebtedness to that institution. In addition to the:fore- Volume 136 Financial Chronicle going, the applicant requests $3,300 for property taxes and $6,351 for bond Interest due June 20 and July 1 1933. respectively' A monthly forecast of cash balances, receipts and disbursements for 1932 is incorporated in the application. For the month of October. the applicant's cash receipts amounted to $3,955, disbursements $3,386, with a cash balance of $2.343 as of Nov. 1. It is the applicant's estimate that receipts for December will aggregate $2.000, with disbursements of $28,054. These disbursements include $26,054 of Items which the applicant proposes discharging from the proceeds of the loan. Security. The applicant requests that we accept, as collateral security for the loan, its first mortgage 6% bonds, maturing July 1 1945 on the basis of 75%. In Securities of Toledo, A. el W. Ry.. 105 I C.C. 88, Nov. 4 1925, we granted the applicant authority to issue 3,000 shares of no par value capital stock and $300,000 of first mortgage 6% bonds. At the time the application was flied in that proceeding, the applicant's capitalization consisted of 3,000 shares of common stock (par $100) and $300,000 of first mortgage 5% bonds Those bonds had matured in 1922, no interest having been paid on them from 1918 to 1925. As recited in our report in that proceeding, the Sandusky Cement Co. in 1921, discovered in the territory adjacent to applicant's line large deposits of materials essential in the manufacture of Portland cement. In 1922 the cement company acquired all of the applicant's stock and bonds. As of June 1 1925, the applicant was indebted to the cement company in the sum of $523,426 for principal and interest on the bond issue, loans for additions and betterments, maintenance, operation, and rail, and for interest on open accounts. Representations were made oy the applicant in the above-mentioned proceeding to the effect that the cement company had agreed to accept $300.000 of its first mortgage 6% bonds in lull settlement of the indebtedness of $523,426. The 3,000 shares of no par value stock which the applicant was authorized to issue were to be exchanged share for share for the 3,000 shares of stock then outstanding. It was further proposed to issue the stock under a declared value of $5 per share in order to comply with the laws of Ohio Which require the placing of a declared value upon all or no par value stock for accounting purposes. Although not referred to in the application, it has been developed after inquiry that upon delivery of these bonds to the Sandusky Cement Co. (now Medusa Portland Cement Co.), and prior to their delivery to the latter company's stockholders as a capital distribution, payment of the entire issue was guaranteed by the Sandusky company. A question naturally arises as to the present validity of this guaranty Irhofar as it relates to bonds subsequently reacquired by the applicant. It is the view of counsel for the applicant that such reacquisition does not in any manner effect a release or discharge of the obligation of guaranty. The applicant positively asserts that the guaranty of the Cement company was not negatived by the applicant's action In reacquiring the bonds now proposed to be pledged but, on the contrary, it insists that such guaranty will constitute a lawful obligation effective to the maturity date of the bonds in 1945. As of Sept. 30 1932, the applicant's capitalization consisted of 3.000 shares of no par value common capital stock, carried in its accounts at a declared value of $15,000 and $300,000 of first mortgage 6% bonds, dated July 1 1925, maturing July 1 1945. The mortgage provides for an issue of not to exceed $400.000 of bonds, with the right of redemption in whole or in part on any interest maturing date at 105% of par. Provision is also made that no dividends shall be paid on applicant's stock while bonds exceeding 3250,000 are outstanding. Further provision is made for a scale of dividend payments whereby the amounts range from $3,000, when the amount of bonds outstanding is between $200,000 and $250,000, to $12.000 when less than $100,000. Since 1926, the applicant has reacquired, at substantially par and accrued interest, $88.300 of these bonds, which bonds, now held uncancelled in its treasury, are offered as security for the present loan. The applicant states that the mortgage under which these bonds were Issued is a first lien upon all of its property, paramount to all other liens except taxes and assessments levied by the public authorities of the State of Ohio. These bonds have not been listed on exchange and censesequently have no established market value. As previously indicated, extensive rehabilitation was accomplished by the applicant during the period 1922 to 1925. resulting in an average deficit of $20,100 in net income for the five-year period ending Dec. 31 1925. During the succeeding six-year period,1926 to 1931,its net income averaged $22,581. For the 11-year period 1921 to 1931, net revenue from operations averaged 46,448; not railway operating Income. $22.045; gross income, $22,959; Interest on funded and unfunded debt, $18,833, and net income, $3,181. The applicant's operations during the first nine months of 1932 reflect a deficit of $20.240 in net income. It estimates a further deficit of $8,494 for the remaining throe months, or a total deficit in net income of $28,734 for the year 1932. Conclusions. We conclude; 1. That we should approve a loan of not exceeding $21,000 to the applicant by the Finance Corporation, for a period not exceeding three years from the date thereof, for the following specified purposes: (a) For payment of past due bills for coal, material and supplies $1,662 (b) For payment of excise and property taxes due in Dec. 19324,920 (c) To pay and discharge in part a 90-day note held by the Cleveland Trust Co. of Cleveland, Ohio, maturing Dec. 27 1932, providing the trust company agrees to accept a promissory note of the applicant in the same face amount, to be secured by the pledge of $10,000 of the applicant's first mortgage bonds, and to mature not earlier than the maturity date of the loan 5,000 (d) To pay interest due Jan. 1 1933, on applicants first mortgage 6% bonds 6.351 2. That the loan should be secured by the pledge of not less than $50.000 of the applicant's first mortgage 6% bonds. maturing July 1 1945; provided, the applicant shows to the satisfaction of the Reconstruction Finance Corporation that the guaranty of payment of the bonds by the Medusa Portland Cement Co.(formerly the Sandusky Cement Co.) will survive as a binding and valid obligation of that company when the bonds are pledged, as aforesaid. Dr. Kimball of Cornell University Says Technocracy Is Not Panacea for Economic Ills. Associated I'ress accounts from Philadelphia, Dec. 26, are authority for the following: Without its "attractive jargon," says Dr. Dexter S. Kimball, dean of the College of Engineering of Cornell University, technocracy would not have received much attention. Declaring it is not a panacea for economic ills, Dr. Kimball told Philadelphia engineers in an address yesterday that their profession should "disown technocracy." The philosophy of technocracy, he said, is fostering the motion that engineers and inventors are responsible for the business depression. The 79 next step in the public mind, he added, is to hold engineers responsible for the way out. Foreign Holdings of United States Steel Corp. Stock. The United States Steel Corp.in its recent quarterly report showed the foreign ownership of its shares shows 251,896 common shares and 79,936 preferred shares held abroad as of Sept. 30 1932. Common holdings have increased steadily in each quarter since June 30 1930 when the total was only 170,803 shares while preferred holdings, on the other hand, have shown an irregular downward trend since the same date when they were 95,213 shares. At June 30 1932 the stock held abroad amounted to 222,073 common shares and 77,799 preferred. Prior to the World War, of course, a vastly greater number of shares was held in foreign countries, the amount at June 30 1914 having been 1,274,247 common and 312,311 preferred. Below we show the figures as of various dates since 1914: FOREIGN HOLDINGS OF SHARES OF U. S. STEEL CORPORATION Sept. 30 Sept. 30 Dec.31 Dec.31 Dec.31 Dec.31 Dec.31 1932. 1931. 1931. 1930. 1929. 1928. 1914. Common Stock. Africa Algeria Argentina Australia Austria Azores Belgium Bermuda Bolivia Brazil British India Canada Central America_ Chile China Colombia Denmark Ecuador Egypt England Finland France Germany Gibraltar Greece Holland Hungary India Ireland Italy Japan Java Luxembourg_ Malta Mexico Norway Paraguay Peru Poland Portugal Rumania Russia Scotland Servia Spain SumatraSweden Switzerland Syria Turkey Uruguay Venezuela Wales West Indies No address Total Preferred Stock Africa Algeria Argentina Australia Austria Azores Belgium Bermuda Brazil British India_ Canada Central AmericaChile China Colombia Denmark uador Egypt England France Germany Greece Holland Hungary India Ireland Italy Japan Luxembourg__ _ _ Malta Mexico Morocco Norway Poland Peru Portugal Russia Scotland Serbia Spain sweden Switzerland Turkey Wales West Indies Total 314 219 219 199 183 178 92 276 2,258 1 2,928 227 17 385 45 222 1,944 1 2,653 227 7 261 47 222 2,234 1 2,663 227 17 267 50 217 3,418 1 2.756 150 1 242 122 198 2,210 3 2,645 150 1 212 20 192 2.643 68 49 9 28 309 2,999 37 1 16 6 2.832 2,513 144 1 278 - 1 340 6 3 690 5,509 46 --18 17 55.111i 59r.N 87:658 89:866 98:686 81.856 54,855 553 559 599 290 456 391 382 499 429 549 366 331 373 s 94 556 143 40 34 35 13 1 ----18 18 18 ---8_ 1 _1 18 36 23 ____ 31 1 1 1 66 66 ---54.630 42.326 44.575 43,140 37,968 36.099 710-,621 70 60 64 15,765 15,119 14,522 13.375 12,937 13,074 64,537 1,531 936 1,197 1,037 880 885 2,664 100 57 74 72 Si 57 38 ___, 90.332 51.316 53,725 43,654 42,544 44,080 342,646 149 194 149 24 15 188 101 102 16 14 ii 714 629 656 425 343 298 2,991 1,253 1,058 1,107 903 855 703 146 3,096 1.138 1,345 46 210 49 6 37 37 37 7 7 5 37 33 37 33 29 33 56 56 56 56 5656 75 1,127 1,245 1.425 1,035 36 21 300 164 129 129 108 74 76 70 g 6 9 ig ii i6 1 6 ____ 39 28 31 10 2,887 16 6 6 2,814 4 2.735 4 2.884 - id 4,208 2:666 2-.666 2:668 1:566 5 997 938 666 666 1.259 1,215 ---_ _ _ 2,080 5 1,680 2,878 65 219 1.268 35 219 1,611 35 219 1,249 2,680 2.078 1,470 219 219- H§ 61 5 id -- 17 33 8.581 ---- 7.804 ---- 8,307 ---- 6.318 ---- 6.092 ---- .57 5- --- 86 - i dii 1,872 -- -- 251,896 196,416 199.965 182,072 182,150 166,415 1.193064 114 104 104 392 104 104 59 ------------------------75 15 30 30 30 11 15 30 60 70 60 484 60 60 60 979 608 1,009 528 538 476 2,085 120 120 120 120 120 120 _ 540 523 523 691 604 570 523 533 533 533 533 647 520 21 31 ---____ 81 21,060 24.NO 21.-,Ri§ 25.585 26-,H8 26-,ifh 34,673 --i6__i6__i6__66__ 100 146 42 12 W 124 124 124 42 132 136 136 5 5 5 5 5 5 217 217 217 217 - -4-6265 217 Ec 11 11 11 11 140 5 11 24,306 30,685 27.032 34.135 32,132 35,354 174,906 8,793 9,451 8,78.1 9,641 10.658 13.088 36,749 957 1,007 1,017 1,016 1.091 1,081 3,252 13 13 13 13 33 13 18 10,927 10.232 9,832 10,509 10,369 10.570 29,000 10 10 10 --------75 598 596 596 596 596 616 _ 601 554 554 520 .514 561 4,119 1,419 1.410 1,409 1.432 1.38 1.449 1,678 1 1 1 1 1 81 1 63 63 63 63 63 63 _iai 64 11 1 11 13 45 14 1 14 2 14 1 14 3 12 12 217 1,421 7 1.508 17 1.493 7 1,508 7 1,442 371 745 2,790 103 443 722 2,648 100 443 722 1,998 100 403 722 2,018 100 482 717 3,488 100 2,377 2,492 2.507 2,737 2,837 235 T 27 i 120 7 43 1,455 13,747 220 432 572 753 1,137 3,746 2,617 100 100 1,068 3.392 874 79,936 89,301 80,792 93.259 94.524 101,942309,457 The following carries the comparisons back for a long series of dates: Financial Chronicle 80 '11" PREFERRED. COMMON. Shares. Per CS. Shares. Per CS. Date-'41nYvia Date8.67 312,311 Mar.31 1914 25.29 1,285.636 Mar.31 1914 312,832 8.67 1,274.247 25.07 June 30 1914 June 30 1914 309.875 - 8.60 1,231.968 24.24 Sept.30 1914 Sept.30 1914 309.457 if 8.59 1,193.064 23.47 Dec. 31 1914 Dec. 31 1914 308.005 ".1 8.55 1.130.209 22.23 Mar.31 1915 Mar.31 1915 303,070 8.41 957,587 18.84 June 30 1915 June 30 1915 297,691 ',' 8.28 826,833 16.27 Sept.30 1915 Sept.30 1915 274.588 i 7.62 696,631 13.70 Dec. 31 1915 Dec. 31 1915 262.091 A 7.27 Mar.31 1916 12.48 634.469 Mar.31 1916 236.361'‘, 6.56 625,254 12.30 June 30 1916 June 30 1916 171,096 %1 4.75 537.809 10.58 Sept.30 1916 Sept.30 1916 156,412 4.34 502,632 9.89 Dec. 31 1916 Dec. 31 1916 151.757 4.21 494,338 9.72 Mar.31 1917 Mar.31 1917 3.94 30 142.226 June 1917 9.45 481.342 1917 30 June 140.039 3.59 477.109 9.39 Sept.30 1917 Sept.30 1917 140.077 3.88 484,190 9.52 Dec. 31 1917 Dec. 31 1917 140.198 3.90 485,705 9.56 Mar.31 1918 Mar.31 1918 149,032 4.13 491,464 9.66 June 30 1918 June 30 1918 495.009 9.73 Sept.30 1918 147.845 4.10 Sept.30 1918 148,223 4.11 491.580 9.63 Dec. 31 1918 Dec. 31 1918 146.478 4.07 493.552 9.71 June 30 1919 Mar.31 1919 149.832 4.16 465.434 9.15 Mars 31 1919 June 30 1919 143.804 3.99 394.543 7.76 Sept.30 1919 Sept.30 1919 138,566 3.84 368.895 7.26 Dec. 31 1919 Dec. 31 1919 127.562 3.54 348,036 6.84 Mar.31 1920 Mar.31 1920 124.346 3.46 342.567 6.74 June 30 1920 June 30 1920 8.36 118.212 3.28 323.438 Sept.30 1920 1920 Sept.30 111.436 3.09 292.835 5.76 Dec. 31 1920 Dec. 31 1920 2.96 106,781 289.444 5.69 Mar.31 1921 Mar.31 1921 105.118 2.91 288,749 5.68 June 30 1921 June 30 1921 103.447 2.87 285.070 5.60 Sept.30 1921 Sept.30 1921 128,818 3.58 280,026 5.50 Dec. 31 1921 Dec. 31 1921 128.127 3.55 280,132 5.51 Mar.31 1922 Mar.31 1922 123.844 3.43 275,096 5.41 June 30 1922 June 30 1922 123.710 3.43 270.794 5.32 Sept.30 1922 Sept.30 1922 121.308 3.36 261,768 5.15 Dec. 30 1922 Dec. 30 1922 119.738 3.32 239.310 4.70 Mar.29 1923 Mar.29 1923 3.27 4.07 June 30 1923 117,631 207.041 June 30 1923 118.435 3.29 210.799 4.14 Sept.30 1923 Sept.30 1923 113,155 3.10 203,109 3.99 Dec. 31 1923 Dec. 31 1923 112,521 3.14 201,636 3.96 Mar.31 1924 Mar.31 1924 112,191 3.12 203.059 3.99 June 30 1924 June 30 1924 111.557 3.01 201.691 3.97 Sept.30 1924 Sept.30 1924 111.759 3.19 198,010 3.89 Dec. 31 1924 Dec. 31 1924 111,463 3.10 3.85 Mar.31 1925 195.689 Mar.31 1925 111.800 3.10 127,335 3.50 June 30 1925 June 30 1925 112.679 `I' 3.12 127.078 2.50 Sept.30 1925 Sept.30 1925 113.843 *I 3.16 119.414 2.35 Dec. 31 1925 Dec. 31 1925 112.8443.13 122,098 2.40 Mar.31 1926 Mar.31 1926 2.10 111,908 1926 30 2.53 June 129,020 1926 June 30 112,822 3.12 123,557 2.43 Sept.30 1926 Sept.30 1926 112,562 3.14 123,090 2.52 Dec. 31 1926 Dec. 31 1926 113,478 3.15 120,348 2.37 Mar. 31 1927 Mar.31 1927 113,432 3.15 168.018 2.36 June 30 1927 June 30 1927 112,835 3.14 173.122 2.43 Sept.30 1927 Sept.30 1927 111.262 3.08 177.452 2.49 Dec. 31 1927 Dec. 31 1927 112,385 3.12 187.006 2.62 Mar.31 1928 Mar.31 1928 110,023 3.06 180,829 2.54 June 30 1928 June 30 1928 109.626 3.03 175.039 2.46 Sept.30 1928 Sept.30 1928 101.942 2.83 166.415 2.34 Dec. 31 1928 Dec. 31 1928 101,627 2.82 173,920 2.44 Mar. 31 1929 Mar.31 1929 41 2.68 ' 96.362 183.396 2.28 July 31 1929 July 31 1929 94.724 ''' 2.64 1929 30 2.18 176,485 Sept. 1929 Sept.30 94,524"2.63 182.150 2.24 Dec. 31 1929 Dec. 31 1929 94.399"2.62 171,947 2.00 Mar. 31 1930 Mar.31 1930 95.213 'I' 2.64 1.99 June 3071930 170,803 June 30 1930 93,737 T. 2.61 173,824 2.00 Sept.30 1930 Sept.30 1930 93.259 8 2.60 182.072 2.09 Dec. 31 1930 Dec. 31 1930 94,617 At 2.62 182.804 2.10 Mar.31 1931 Mar.31 1931 91,991' 2.55 190.868 2.19 June 30 1931 June 30 1931 89.301 2.48 196,416 2.26 Sept.30 1931 Sept.30 1931 80.792 2.24 199,965 2.29 Dec. 31 1931 Dec. 31 1931 79.941 2.22 215.908 2.48 Mar.31 1932 Mar.31 1932 77,799 '" 2.16 222,073 2.56 June 30 1932 June 30 1932 s 251,896 2.8979,936.'2,22 Sept.30. 1932 Jan. 7 1933 which resumeecommoedIvidends with a payment of 20 cents a share in June. and subsequent-payments of 20 cents and 10 cents a share in September and December. Special distributions of $5.18 a share by Penn-Mex Fuel Co.. $25 by Cumberland Pipe Line Co.. $5 by New York Transit Co. and $20 by Northern _Pipe Line Co. were responsible for the increased payments by`these companies. Standard of New Jersey, Chesebrough Manufacturing Co., Atlantic Refining, Imperial Oil and International Petroleum are among the companies which continued dividend payments during 1932 at the same rate as in the previous year. Total dividend distributions by the Standard Oil group of companies during recent years follow: 8150,388.555 $218.740.335 1924 $181,050,895 1928 1932 138,423,295 213.617.940 1923 220,739,182 1927 1931 129,039.865 200,311,594 1922 286,526,728 1926 1930 115,315,29" 153.506,099 1921 269,645,927 1925 1929 Dividend distributions for the last quarter of recent years follow $62.685,548 375.003.85611926 $44,112,501 1929 1932 42,104,169 62,060,357 1925 48.530.230 1928 1931 55,724,472 W83,012,644 1927 1930 House Passes Resolution Calling Upon Reconstruction Finance Corporation to Make Public Details of Loans Between February and June Last Year. A resolution passed by the House of Representatives yesterday (Jan. 6) calls upon the Reconstruction Finanee Corporation for a report on loans made in its first five months of existence last year and plans were made for the Corpora.. tion to comply without dealy, according to Associated Press idvices from Waslungtwhich added: Soon after getting-word of the action, Atlee Pomerene-head of the gigantic lendineagency-went into conference to consider what steps would be necessary. The Corporation hitherto has opposed publication of its loans, which have been given out monthly since June. To-day's resolution deals with what went on before that time. Mr. Pomerene refused to comment, but In other Corporation sources it be was said thatLundoubtedly the report would be sent as soon as it could made up. it If the information asked by the House has not already been compiled, probably will take a week or two to prepare it. The expectation, however, the is that most of the information asked already has been supplied to Couzens "Committee of the Senate which was named to investigate the Corporation. The report will involve 5,084 loans. Roger W. Babson Sees Peril in Economy TalkAdvocates Diverting Part of Charity Funds to Promote "Judicious Spending" - If He Were Mussolini of Nation He Would Employ Jobless in Sales-Promotion Work. Speaking on the subject, "If I Were the Mussolini of the United States," Roger W. Babson, economist and statistician, told an alumni dinner of Babson Institute at the Hotel Governor Clinton in New York on Dec. 13 that the " Mae-following table we also show the number of shares National Economy League and other organizations had between brokers carried their economy drive too far. The great need now of the SteertorpOiitfon - is not economy so much as a revival of "judicious spending," and investors as on Sept. 30 1932 and-8617'30-1937 Sept.30'32. Ratio. Sept.30'31. Ratio. Common-. which would revive industry, business and employment, Brokers, domestic and foreign-- 1,241.577 14.27% 1,145.363 13.16% Investors,domestic and foreign-- 7,461,675 85.73% 7.557.716 86.84% to Mr. Babson. According to the New York according Preferred275,157 7.64% 8.59% Brokers,domestic and foreign__- 309,581 which the foregoing is taken, Mr. Babson from "Times," Investors,domestic and foreign-- 3,293,230 91.41% 3,327.654 92.36% the power he would divert part of the had he if that said The following is of interest as it shows the holdings of used for charity to subsidize a selling and now funds public brokers and investors in New York State: advertising campaign on the part of the unemployed, which Sept.30'32. Ratio. Sept.30'31. Ratio. Common1.163,333 13.37% 1.072.410 12.32% Brokers would create a desire for goods on the part of the public Investors 1,809,243 20.79% 1.992.623 22.77% that would start the wheels of consumption and production Preferred246,396 6.84% Brokers 244,540 7.89% again. The "Times" also quotes him as follows: 1.444.925 40.10% 1.523.706 42.27% Investors zisTritutiRrrs Dividend Disbursements by Standard Oil Group During 1932 Smallest Since 1926-Distribution for Current Year Will Aggregate $181,050,895 Against $220,739,182 for 1932-Compares With $286,526,728 Paid in Record Year of 1930. Cash dividend payments by the Standard Oil group of companies for 1932 are estimated at $181,050,895 as compared with $220,739,182 in 1931, a decline of $39,688,287, or approximately 18%, according to records compiled by rl H. Pforzheimer & Co. Two of the smaller companies rahave not yet tan action-for the final quarter - of1932, but regular payments are included in the total. Disbursements of the group for the fourth quarter of 1932 are estimated at $44,112,501 compared with $43,858,468 in the third quarter and $48,530,230 in the fourth quarter of 1931. The compilation by Carl H. Pforzheimer & Co. also revealed: Three of the leading companies accounted for the greater part of the decline in payments for 1932. Socony-Vacuum Corp. in the final quarter reduced its dividend to 10 cents a share against 20 cents a share paid in the third and second quarters and 25 cents in the first quarter. Total dividend payments of Socony-Vacuum Corp. for 1932 will amount to approximately $29.918,353 compared with $43,469,353 In 1931. Standard of Indiana's dividend payments will approximate 816,908,544 for the year, as against 825.491,894 in the previous year, reflecting the dividend reduction made in the third quarter of 1931 from 50 cents to 25 cents a share quarterly. Standard of California paid $2 a share this year, compared with $2.50 in 1931. The smaller decreases in total payments recorded by several other companies were partially offset by increased disbursements of Ohio 011 Co.. "I strongly condemn the constant talk about economy as carried on by the National Economy League and other organizations," said Mr. Babson. "Their original efforts to eliminate abuses, graft and waste In connection with veterans' aid and other Government expenditures were praiseworthy. Their general preaching of economy at this time is, however, both wrong and very dangerous. The time to have preached economy was during the boom from 1926 to 1929, not to-day. Nation Has Economy Complex. "To-day we need to emphasize the importance of judicious spending. Only as more is spent will there be more produced. Only as more is produced will there be more to divide. "Unemployment will not be solved by having people loaf more hours a day or more days a week, thus stabilizing production at present low figures. Men can be put back to work, interest and rents can be earned, and general prosperity will return only by enlisting the unemployed to create, under Proper leadership, a desire to buy. "The important thing is for the Federal Government to subsidize, not idleness, nor the building of public works, nor any other charity, but rather advertising and selling. "If you will make me the unemployment Mussolini of this country, I agree to organize and train an army of men and women now unemployed to present a nationwide educational campaign to create a legitimate demand for goods. Give me a small portion of the money which public officials are to-day spending upon charity and let me use this money in giving a group of the unemployed supervised promotional work, and the demand for goods will immediately return. Then industry will call back Its unemployed, and before long business will be back to normal." Suggests a Permanent Remedy. To permanently offset the cycles of prosperity and depression, he said, he would divide industrial workers into three groups-producers, sellers and a "flying squadron" whichlwould produce when there is a shortage of goods, and would sell when there is a surplus. Mr. Babson characterized "most talk" about technocracy and Ithe machine age as causes of the depression as "all bunk." "To offer restricted production as a cure for unemployed," he said, "is a crime against Volume 136 Financial Chronicle the American standard of living." The problem of technological linprovements. he went on, could be solved by legislation requiring the condemnation of old plant and machinery as new is created. Mr. Babson predicted that prosperity would return "in spite of anything which governments and bankers can do to prevent it." He gave the following four reasons for this belief; "I. A change of heart is taking place with the people of America. The revival of righteousness is laying the foundation for a new period of prosperity. "2. Deflation has largely been completed. The only remaining factor to be deflated is in connection with debts, rents and taxes We are now on the verge of a radical reduction in all fixed charges from personal mortgages to international debts. "3. Consumption is to-day exceeding production. The depression, like a fever, is developing its own antidote and will cure itself. "4. Idle funds ultimately burn holes in peoples pockets. There are more Idle funds in the United States to day than ever before in our history." Discussion of Technocracy Before American Association for Advancement of Science—Prof. Rautenstrauch Says "Energy Hours" Will Replace "Man Hours" in Industry. Energy hours—the measure of work accomplished by the machine—inevitably will replace the familiar unit of man hours in industry, and industrial planning of the future, therefore, must be quite different from any which existed In the past, Prof. Walter Rautenstrauch, head of the Department of Industrial Engineering at Columbia University, and a leader in the Technocracy movement, declared at Atlantic City on Dec. 28 before the Engineering Section of the American Association for the Advancement of Science. Prof. Rautenstrauch's address on "Technological Development and Social Change," an exposition of the credo of Technocracy, was delivered in a symposium on employment stabilization. He acknowledged his indebtedness to "my co-workers Howard Scott, director of the Energy Survey of North America; to Frederick L. Ackerman, for interpreting statements, and to Bassett Jones for certain mathematical analyses of the data recorded to date." From Associated Press advices from Atlantic City we take the following: The "message of technocracy—purpose uppermost, property values subordinated"—was presented before the American Association for the Advancement of Science today by Professor Walter Rautenstrauch of Columbia University at a discussion of stabilization of unemployment. .. 0. F. Kettering of the General Motors Research Corporation, Detroit, said it Is "foolish" to blame the present economic troubles primarily on science, invention and machines. "As for technocracy," he said, "I'd like to have those fellows for my competitors in the automobile business." Professor Irving Fisher of Yale said technocracy had no bearing on unemployment, except that the more technical activity we have the quicker will we recover from depression. Professor Rautenstrauch's "message" was first the story, which he said history neglected to tell, of the "power revolution" ; second, its effects on man, and the "ridiculous and illogical results" he thinks are forecast unless more purpose comes into its direction; third, a program of the "four cardinal points" of any successful future civilization as the technocrat sees things; finally, that this new "high civilization" raises problems "of a social mechanism under the price system." The power revolution, beginning about 200 years ago, in simple machines for use in home spinning and in mines, raised man out a condition that had existed unchanged for 6,000 years in which "the physical basis of civilization in any continental area resided in man himself." Today, with machines, the "civilized resident of North America has a capacity for energy conversion of 150,000 kilogram calories per day per capita, the highest that ever existed." It is seventy-five to 100 times as much per man as in the "6000 static years" gone by. The big steps in the power revolution were described as, first, the "strength of materials," principles evolved to stop machines from breaking. Second, kinematics, the laws governing the "motions of machines." Then thermodynamics, mostly contributed by astronomers and mathematicians, the laws of power in motion. Finally chemistry. "I bring the message of Technocracy," said Prof. Rautenstrauch, explaining that the movement is being guided by "a group of co-operating technologists who, under the leadership of Mr. Scott and in co-operation with the Department of Industrial Engineering at Columbia University are making serious inquiry into the physical bases of our civilization and the relations of technological developments to social change." The enterprise of Technocracy, he pointed out, is primarily concerned with research from the standpoint of physical values of property and program as it affects the problem of organizing a civilization to maintain itself on a given continental area. He continued: "We ask of those other groups who have assumed responsibility in organized society with particular reference to the controls of the business machine to have regard for those processes of thought and methods of analysis which have enabled the engineer to predict the performance of the machine, the factory, the power plant even before it is created. "We emphasize the importance of the problems of purpose and personnel with which it is the special duty of all our educational agencies to deal. These agencies include the newspapers, the moving pictures, the magazines and all other activities which are operating to interpret and give meaning to life experiences, as well as the schools, the colleges and the home. "We believe that any opinions of future trend in employment and general well-being of mankind in a high energy civilization, which are not derived from an understanding of the natures and magnitudes of the forces which 81 condition social status, are not competent and are unworthy of consideration by scientific men. "The scientist is a questioner, an estimator of probabilities in future trend. He knows no 'holy' places where be dare not tread. He must be prepared to meet the criticisms and resistances of the keepers of the 'holy' places and the defenders of the 'faith.'" Prof. Rautenstrauch declared the Technocracy also concerns itself with discovering the magnitudes and characteristics of the physical forces upon which the maintenance and growth of our civilization are founded and using them as the basis for establishing a possible program of social growth. He went on to say— "The problem of personnel, is perhaps the most vital of all, if it can be said that any one is more vital than the other. Any moral breakdown in personnel is destructive to organized groups. The question is frequently raised, 'Are we of fine enough moral fibre and have we sufficient character to operate the highly integrated social mechanism which now obtains?' "Accordingly we find the institutions of the home, the church and the school have great responsibility in developing that type of personnel which can function in our society. The property values of material resources with which the organized group deals are important to its life but are not the life itself. Therefore, the order of importance of these elements of organigation we believe is as given. The high purpose of the enterprise must be uppermost and property values must be subordinated to their proper place. "We may look upon this arrangement as a pyramid, the apex of which is purpose and the base of which is property. If the pyramid is inverted and purpose is the base with emphasis on property values, we are inclined to believe that the situation is an unstable one and will not endure." Another of the matters about which the technologist is making inquiry, according to Prof. Rautenstrauch, is the trend in employment in the manufacturing industries under the price system of production. He further said: "It will be observed that under the competitive pressure arising from the price system of production, the following general law obtains: The quantity time factor of investment to produce a unit of product tends toward a minimum. Accordingly, under the operation of this law the substitution of kilowatt hours (energy hours) for man hours is inevitable. "Furthermore, since purchasing power arises from wages and in further consideration of the trend in the growth curve of production, it is at once apparent that the progress of a high energy civilization raises some important problems of social change, and the operation of a social mechanism under the price system!' "Is the opportunity for a man to make a living in the manufacturing industries being challenged?" he asked. The answer was supplied in the following illustration: "In 1904 approximately 1,300 man hours were required to build the average automobile—today only ninety man hours are required. In 1929 a certain lamp works required 3,800 employees to man its plant—today only 1,400 are required for the same rate of production. Specific tendencies of this nature occurring in every major industry cannot be disregarded in any study of social change." When the survey of Technocracy is completed, Prof. Rautenstrauch estimated that some 3,000 charts will have been prepared and every field of human enterprise brought under review. "Sufficient data have been accumulated and compared," he explained, "to warrant our asking certain questions relating to the course of production to commodities and the use of energy in relation to the course of population growth, to the use of man hours in production and to the progress of debt under the operation of the price system of production." Prof. Rautenstrauch expounded several mathematical formuhe drawn from the Technocracy charts and noted that they indicated the following general tendencies: 1. That total man hours in manufacture are decreasing inversely with time. 2. That production per capita is increasing directly with time. 3. That debt is increasing faster than production and directly as the time. 4. That debt per capita is increasing as the square of time. "These tendencies of growth obtained during the period which closed in approximately 1920," he commented. "If the rates of growth obtaining up to this period were used as a basis for predicting probabilities, let us say, in the year 1950, most ridiculous and illogical results would be obtained. Accordingly, therefore, we must deal in the future with a wholly different growth curve. The Pearl-Reed equation seeing to fit the growth curves of the major industries which we have so far examined with a considerable degree of fairness. It should be noted that during the period of rapid growth in industry prior to 1920, while the man hours per unit or product were declining in most industries due to mechanization, there was not a very marked change in total employment because of the reabsorption of displaced men in the expansion of industries. "If now the rate of growth is declining in many of our principal industries as seems to be indicated from our studies, the effect of declining man hours per unit of product may have a new significance. We are inclined to believe that our studies, so far as they have proceeded, show that industrial planning of the future must be quite different than that which existed in past times, and that any extrapolation of position based on records of growth prior to 1920 will not constitute safe bases for guides. "Another factor which calls for serious attention is that we have developed a very highly integrated social mechanism, one in which more delicate adjustments are called for and which more scientifically designed control equipments are demanded. The whole basis of control of the business machine should be examined with respect to the adequacy of design of its equipments. "The modern power station Is a possibility because the many pieces of apparatus to be operated in combination to generate currents at varying load demands are integrated and controlled by properly designed control devices. The social mechanism presents the same picture to the technologist and be can see 110 possibility of uniform and stabilized economic society if the control devices of the systems of regulation which it employs are not scientifically designed." 82 Financial Chronicle Out of 6,000 "static" years before the beginning of the nineteenth century, Prof. Rautenstrauch said, have come social practices, theories of social organization and government, beliefs and customs relating to every phase of human experience and destiny. He reviewed briefly the industrial progress of the past two centuries up to the present when "the application of machinery and power to the conversion of our material resources to use-forms has provided the civilization resident in the North American continent with a capacity for energy conversion at the rate of 150,000 kilogram calories per capita per day—the highest capacity for doing work ever existing on any continental area in the world." He added: "The abundance of our natural resources, the high state of our technological development and the resulting vast capacities of energy conversion and use have brought about not only a high state of material civilization but a tremendous rate of social change. "Figures prepared under the direction of Howard Scott illustrate among other things that whereas the social disturbance of the past could not affect seriously the rate at which a man could provide himself with the material things of life, the forces of the present social order are dynamic and move with ever-increasing acceleration within the social mechanism. "Therefore, disturbance of any character within the system generates disorders of ever-increasing magnitude and force. For example, oscillations in the production rate as a consequence of the maladjustment of credit, as one factor, appear with ever-increasing amplitude; the man hours per unit of production are rapidly decreasing and kilowatt hours are being substituted for man hours in many industries at a very rapid rate." Others who participated in the symposium on employment stabilization were Prof. James W. Angell of Columbia University; Prof. Alvin Hansen of the University of Minnesota; Dugald C. Jackson of the Massachusetts Institute of Technology and Elmer J. Working of the United States Department of Agriculture. Legislation Relating to Banking Approved in Michigan— Measures Enacted at Special Legislative Session Reviewed by Commissioner Legislation passed at the special session of the Michigan Legislature was explained by the Bank Commissioner, Rudolph E. Reichert, before the recent annual conference of the Prosecuting Attorneys Association of Michigan. Mr. Reichert's statement as given in part in Lansing, Mich., ad-vices July 12 to the "United States Daily" follows: "Legislation was proposed to alleviate conditions in both operating and closed institutions, but principally directed to relieve the distress caused by the closing of institutions throughout the State. In this respect our condition was not unlike the condition in other States, nor that found throughout the rest of the world. This is not a local problem that we are facing, but a world problem, and the question that confronts us is how to best adjust the situation. "After the closing of several banks and studying the situation In other States, It was perfectly obvious that to continue the forced liquidation of assets through receiverships only added to the distress, and that other methods of relief should be found tending towards the orderly liquidation of assets in those institutions. To force liquidation in the rural communities meant auction sales and foreclosures, adding to the already flooded market, and to an already distressed condition. "Every time an application for receivership is made, additional securities are placed upon the market through these receiverships, and that only adds distress to an already overburdened market. Finally, market prices do not and cannot reflect actual values, but can only reflect a price in such securities placed there by someone who has an interest In and is willing to purchase the same, and In that case will purchase the security as cheaply as possible, so that these forced collections do not represent values in the securities dealt with, and if a sale is forced, in our opinion the creditors of the institution are deprived of the just return that they should have in the liquidation of the security. Provision for Deferring Liquidation of Banks. "Believing that today there is only one way to meet the situation, and that is to permit time to Intervene in the liquidation process, we concluded that methods and measures should be worked out to accomplish that end. "We found in our reorganization program that it was a difficult matter to bring into the reorganization all of the creditors of the Institutions. There were always a few that would hold out, and by their action hold up the almost unanimous efforts of the creditors of the bank. It was with this in mind that the Darin bill, known as the Custodian bill, was presented to the Legislature. We have felt that wherever an institution finding itself in difficulties could make Its own adjustments by and with the co-operation of a depositors' committee, a custodian being appointed from their own ranks, it was a much more feasible operation because they were working out their own problem and having a personal interest in the matter. "When the Attorney General's Department was preparing a bill covering the question of binding the dissenting depositors, they of course were faced with the problem, in whatever action was taken, that it be in due process of law. The Legal Department, however, finally worked out the bill as presented to the Legislature, which was amended in several respects, but was finally passed and signed by the Governor. This bill sets up the machinery for the reorganization of closed banks by the consent of depositors representing 85% of the total liability. "It is predicated upon the question of mutual contract, and these creditors can by contract agree among themselves to reorganize the institution. Those creditors who do not assent to the plan as presented may have their claims presented In court at a hearing provided for in the act, and have assets set aside for them, and the receivership would continue as to the objecting depositors. The depositors representing 85% or more of the deposits, and the non- Ian. 7 1933 objecting depositors, will then under court order assent to the opening of the institution. re- Agreements Regarding Reorganization Cited "I am not going to go into the plan that is being used other than to say that it attempts to preserve the rights of all the creditors of the institution, that it gives them a right to be heard in court and have the court pass upon the equities in the case, and that it places the creditors and debtors in the position where they would be placed If the institution went through receivership, making a concession to the stockholder in order that he or a depositor may again provide capital so that the institution may be reopened with the capital required by statute. The act further provides that public officials through their governing boards may join in these reorganization agreements. "We believe that this act is a distinctive service to the people of Michigan, that it is a relief measure to the depositors of closed banks, and that it prevents the forced liquidation of assets, the value of which are probably to-day at the lowest point, be they represented by personal property on the farm or by security in the form of notes, mortgages or bonds. "There were other bills presented with the co-operation of the Attorney General's Department, under the recommendation of the Governor. These I will attempt to explain to you briefly. "The first bill was what is known as House Enrolled Act No. 1, and provided for the authorization of receivers to borrow money from the Reconstruction Finance Corporation or other persons in order that dividends might be distributed to depositors, or for the purpose of reorganization. This was the first bill passed by the Legislature and signed by the Governor. Distribution of Assets of Banks Discussed "In connection with the distribution of dividends, the law as it stood heretofore, provided for the reduction of assets to cash before a distribution could be made, and in order to make our position on reorganization more secure, the Hull bills were introduced, which provided for the settlement with creditors by the distribution of assets, under an order of the court, with the approval of the Banking Department. We are at present applying these bills to several receiverships in attempting to distribute assets to the larger depositors instead of cash. "Changes were also made affecting the operation of receivers in banks, placing the receivers under the direct supervision of the Banking Department. It was felt that It would be to the best interest of the depositors to have available to the receiver the collective experience gained out of those receiverships, and also that by such direct contact, there would be a greater uniformity of expenses in receiverships than if each one were operated as a separate unit. There was no attempt made, however, and there is no desire on the part of the Department, to attempt to interfere with the functions of the court in respect to these receiverships. The whole plan is one of an attempt to co-operate with the courts and assist them in more speedily effecting adjustments in these receiverships. "In your work, you became familiar with the difficulties that arose in the depositary bond situation. In order to clarify this situation, two bills were introduced and both were passed by the Legislature. The first one was an amendment to the Turner bill of 1929, adding mortgages and Federal land bank bonds to the securities already eligible to be pledged as collateral for public deposits. Measure Relating to Fidelity Bonds "The other bill is known as the Espie bill, which was necessary in order for treasurers to secure fidelity bonds. Under the old law, there was some question as to whether they were not insurers when they became depositors, and the fidelity company signing the bond would no longer sign it because of the wording of the act. After the introduction of this bill, it was amended by removing all requirements as far as the State law was concerned until July 1 1933, leaving all political subdivisions privileged to deal with their public deposits through their respective boards or governing bodies upon their own responsibility. The act, however, is effective only until July 1 1933, making it necessary for the next Legislature to again separately deal with this problem. "From the Department's standpoint, we are convinced that the reorganization program is a distinct service to the people In communities where banks are located that can be reorganized, and, in our opinion, serves as a distinct benefit in offering relief to depositors in the assistance in distributing of assets in banks that can not be reopened, in closer supervising receiverships in conjunction with the court, in reorganizing institutions so that time may elapse and securities may not be sacrificed in present markets, and institutions may function without danger and be of service to the communities in which they are located. "The plan has worked in actual practice much better than anticipated. Institutions that have reorganized have created a new community spirit, money has been brought out of hiding in those communities and the deposits in those institutions have increased, and fears have subsided." Illinois Bankers Association Proposes Revision of State Banking Laws— Would Create State Banking Board. Members of the Cook County division of the Illinois Bankers' Association, group eleven, at a meeting at River Forest Country Club, on Sept. 7, were presented with a summary of the Association's program for a revision of the State banking laws. From the Chicago "Journal of Commerce" it is learned that the program was outlined by M. A. Graettinger, Executive Vice-President. Provisions in the measure to be offered to the next general assembly include the following, according to the paper indicated: Creation of a Banking Board consisting of five members, representing banking, Industry, agriculture and labor, to have supervision over State banks, to appoint a banking supervisor and deputies; to establish safe and sound methods of banking, and to safeguard the interests of depositors and stockholders. Authority of I3oard. The Board shall have authority to cite any bank officer or director who may be charged with carrying on persistent violations of the banking law or the continuance of unsafe or unsound policies and practices, to show cause why he should not be removed from office. Volume 136 Financial Chronicle Banks to make reports of statement of condition in greater detail under rules established by the banking board. Officers of banks not to be permitted to act as officers of any corporation engaged in the business of buying and selling securities. Banks not to be permitted to pledge any assets as security for deposits except as required by law. Banks before declaring dividends to carry 25% of net profits, since declaration of preceding dividend, to surplus or reserve funds until such funds shall amount to 50% of the capital stock. Liquidating Department. Creation of a liquidating department for insolvent banks under the supervision of the banking board with legal aid to be furnished by the Attorney-General of the State and all other services to be paid for on a salary basis. Other constructive suggestions under consideration includes segregation of commercial banking from many of the so-called affiliates that have sprung up, keeping savings deposits separate from checking deposits in the Investment policy of the banks, an annual audit of banks by independent accountants, the report of which to be published for the benefit of depositors, establishment of mutual savings institutions and others of similar nature. Reject Branch Banking. Branch banking and the plan of deposit guaranty are rejected by the association as having failed to provide the protection claimed for them when the tests came. Technocrats Poor Guides, According to Prof. Deibler of Northwestern University. Expressing belief that "the country will, in due time, climb out of this depression just as it has recovered from every previous depression," Frederick S. Deibler of Northwestern University warned at Cincinnati on Dec. 27 that "we must not take too seriously the pessimistic and lugubrious predictions of some of the members of the Technocracy Group of Engineers." The Associated Press advices from Cincinnati continued: Deibler, Professor of Economics, is Secretary of the American Economic which meets here tomorrow with other groups for a three-day survey of conditions of modern life. Deibler declared if the technocrats "had really something valuable to offer they would present it through scientific journals instead of through popular organs of publicity." Minnesota Denies State Deposits to Non-Taxed Banks— Failure of National Bank to Comply With State Levy Deprives It of Privilege, Attorney-General Rules. National banks in Minnesota which do not comply with the State law relative to taxation of their shares cannot be used as depositaries of State funds, Assistant Attorney-General W. H. Gurnee has ruled. This is learned from St. Paul, Minn., ads-ices, Sept. 6, to the "United States Daily," which gives as follows the Attorney-General's letter addressed to the County Attorney of New Ulm: Dear Sir: Without undertaking to repeat the statement of facts set forth in your letter of Aug. 27 1932, it appears to us that a short answer is as follows: Purpose of Statute. The purpose of the statute to which you refer is well known. The Legislature felt the National banks which were not willing to pay the taxes against them the same as State banks should not be permitted to act as depositaries of public funds. While it would appear on the records that the taxes for 1927 and 1928 assessed against the shares of capital stock of the bank in question have been paid through adjustment and settlement, still there was not a compliance with Section 1973-7, and the prohibition contained therein against any public officer depositing public funds in such a bank still obtains. You ask for our opinion upon the constitutionality of Laws 1927, Chapter 381. Oonsfitutionalfty of Law. The disposition of this office is always to uphold the constitutionality of any enactment of the Legislature. We feel that the courts, rather than the Attorney-General, should declare lawn invalid which have been lawfully enacted by the Legislature. Furthermore, offhand we see no reason why the Legislature may not make laws regulating where public moneys shall be deposited. For example, we think it would be within the power of the Legislature to validly enact a law that all public moneys be deposited in State banking institutions, or in State bank institutions having a certain specified capital and surplus. At any rate, we think that we must assume the constitutionality of this law. Status of School Funds. We think that the prohibition in Chapter 381, Laws 1927, applies to the treasurer of a school district which has requested the school board to designate it as a depositary and the board has refused or failed to do so. The funds which the school treasurer has are still public funds, and he has no right to deposit thorn in a bank which has not complied with Lows 1927, Sett:in 381. Alabama Enacts Law Under Which State Superintendent of Banks Is to Co-operate in Reopening of Banks. The following, from Montgomery (Ala.), Sept. 12, is from the "United States Daily": Governor Miller has signed, and thereby finally enacted into law, Senate Bill 70, by Senator R. IT. Powell, which permits the State Superintendent of Banks to co-operate in the reorganization and reopening of closed banks. Under the Act, the co-operation of the Superintendent will be with the depositors and common creditors of the closed institution in the working out of plans for reorganization and reopening. He is also empowered to do all things necessary to make the bank safe and after the plane that have been formulated bare been submitted solvent, to and approved by a court of proper jurisdiction. 83 Security Owners' Association Claims Nation's Transportation System Is Over-Developed--Favor Coordinating of Motor Buses and Trucks with the Railroads. That the subsidies created by the Federal and State governments incident to the development of the National and local highway systems and the attendant growth of motor vehicle operation, considered in conjunction with the facilities of the steam railroads, have provided the country with a transportation system more than adequate for years to come was the belief expressed on Sept 13 by Milton W. Harrison, President of the Security Owners' Association, who has completed a comprehensive report upon "the highway situation as related to motor truck competition with rail carriers." The report stressed the destructive competition with which the railroads have had to cope by reason of the freedom of motor operation from the restrictions of Federal regulation of rates. Alluding to the financial effect of motor vehicle expansion upon railroad earnings Mr Harrison's report contends that if during the period of depression the revenue earned by trucks and buses had been allotted to the railroads, about 60 cents in net revenue would have been realized by the railroads out of each dollar earned by the motors. The highways report is one of several basic studies upon which the Security Owners' Association has been merged for more than a year in an effort to focus attention upon the railroad problem with especial reference to the depression and in order to develop a program of legislative recommendations contributing toward the restoration of railroad credit and the rehabilitation of the railroad industry Other studies consider the competition of waterways, of commercial aviation, of pipe lines, and the eliminaton of grade crossings jointly by States and railroads, as well as the effect of Reconstruction Finance Corporation loans upon capital structures. The Security Owners' Association is composed of investors in railroad securities. Its membership includes more than 1,200 National banks, State banks and trust companies, 400 mutual savings banks, 100 life, fire and casualty insurance companies and many thousands of individuals. The Association is preparing through its Executive Committee to urge Federal and State authorities to bring about effectual co-ordination of the steam and motor transportation services. By reason of the financial responsibility of the railroads and because of their experience, the Security Owners' Association will urge that the co-ordinated services be brought under the control of rail management. The report says: Many States have few or no requirements as to financial responsibility of truck operators; hence in many cases damage or loss is not compensated for. It will be necessary to bring about changes in public policy to Wed the greatest measure of rail-highway co-ordination. The economic justification of the National policy toward highway expansion has been open to serious question. The Government is spending an ever-increasing portion of its income for highway purposes. but despite this the highways are not, and undoubtedly never will be, entirely selfsupporting." Mr.Harrison made the point that a monopoly in the transportation industry no longer is enjoyed by the railroads. "The development of hard-surfaced roads, inland waterways, pipe lines and aviation have drawn to themselves traffic formerly carried by the railroads. The regulatory restrictions to which the railroads are subjected have hindered their efforts to meet this competition." He further says: This growth has come in response to public demand, and such agencies, of course, do fulfill a definite economic function. The problem therefore is to evolve a public policy which will assure the most economic use of all transportation and that will permit each to grow. In the early days of the motor the railroads were misled into encouraging the building of highways in the belief that they would provide additional traffic by providing feeders and through the tonnage of highway materials, as well as the products of motor vehicle manufacturers. In most instances, however, the railroads did not foresee the competition which would result from highway development. From 1920 to 1930 motor vehicle registration increased from one million to nearly three and one-half million units, or 245%. Nearly two-thirds of all trucks are owned by individuals possessing but one truck, although mergers have changed this somewhat recently. As to regulation, the statement by the Security Owners continues: A railroad cannot lower its rate to meet competition without submitting the now rate to the Inter-State Commerce Commission for approval. The rate may be refused as being discriminatory or as not sufficiently compensatory. The Commission has found that some truck operators maintain substantially lower rates in one direction than In another in order to induce return loading when there is a heavier volume moving In one direction than In another. At present there is no control over inter-State movement of trucks, nor is there uniformity in State laws respecting their use of highways. There is no similarity in laws governing weight limitation or taxation of trucks. Truck regulation is minor compared to railroad restrictions. This gives to the trucks definite advantages over the railroads in the competition for business. 84 Financial Chronicle The Security Owners likewise contended that the property investment placed the railroads at a disadvantage against motor operation, by reason of less expensive equipment costs per unit and of the freedom from right-of-way and terminal costs enjoyed by trucks. The report states: In spite of inroads upon carload traffic which the trucks have made upon railroad revenue, the chief competition is felt in the less-carload traffic, and as the less-carload traffic diverted is mostly higher profit traffic, the railroads have suffered seriously from this financial encroachment. Then again, the railroads at the urgent solicitation of automobile manufacturers built large capacity freight cars by the thousands, only to have those cars stand idle the last few years while those manufacturers moved their output over the highways. The idle capital invested in idle equipment has been very expensive to the railroads because of this fundamental change in the handling of automobile traffic. Mr. Harrison's report contended that taxation provided one of the chief burdens upon railroads in favor of motor traffic. The report states: It has been contended that highway expenditures are largely responsible for the great increase in railroad taxation in the last 10 years and that the railroads are forced to subsidize their competitors. Railroad taxes in 1929 amounted to $400.000,000, or 6.3% of operating income. Highway expenditures increased, 1930 over 1923 more than the tax paid by the railroads. Of the total highway income received 1923-1929. users of the highways through gasoline and motor vehicles taxes paid only 32%, the balance having been raised through bonds, approporiations from general property tax and Federal aid. It appears, therefore, that both the general public and the railroads are subsidizing the highway carriers to the extent of 55% of total cost of maintenance and development. There is an increasing tendency by the railroads to enter the motor-vehicle transportation field, illustrated by the statement by Mr. Harrison that 32 railroads have invested $46,000,000 in motor transportation companies controlled by them. "Seventy-five percent. of this investment," said Mr. Harrison,"is owned by four large railroads, namely the New Haven, Pennsylvania, Southern and the Great Northern. The activities are devoted largely to bus operations, where there is not the possibility of regaining as much traffic to diminish net losses as with trucking. A number of railroad companies are conducting experiments with railhighway service, containers service, &c., designed to protect traffic from competition with trucking companies. In most instances, where the railroads have tried to regain some of their lost traffic with some form of truck service, though without co-ordination, their efforts have not been very successful." Continuing Mr. Harrison said: Federal regulation as to rates and convenience of service, is essential to true rail-highway co-ordination. Under present conditions it is impossible to carry shipments using rail-highway service on through billing. Under adequate regulation the irresponsible carrier would disappear. Competition between rail and highway carriers would more fully respect the rights of shippers and the public and the independent trucker would make way for the co-ordinated facilities capable of rendering that service at lower cost. The private carrier transporting his goods to destination and hauling return loads at any price would be eliminated. Relieved of such competition, the railroads would benefit in credit and financial stability. Discrepancies existing in State regulation as to size and weight of vehicles, lack of uniformity in gasoline taxes. Fee., should be corrected. The highways should be made as nearly self-supporting as possible and the maximum amount consistent with continued utilization should be collected from those operating over them. It likewise stands to reason that those operators using public facilities to perform commercial service should pay a premium for the privilege. Among the conclusions drawn by Mr. Harrison in his report were the following: Railroads are hampered in meeting motor competition by regulation, while regulation of highway carriers is sporadic and often ineffectual. The competitive advantages of railroads over trucks are: Greater permanency of operation, greater dependability and greater financial responsibility. Revenue loss to railroads has been felt chiefly in less-carload business. As highway traffic developed the railroads not only lost the tonnage formerly derived from haulage of materials but they felt the inroads upon their traffic because of the enlarged highway system tapping new markets and new regions for their motor competitors. The tax funds spent in creating our National highway system have fostered a tremendous over-capacity of transportation facilities. The railroads spent $5,500,000,000 of dollars on their plants in 1020-1929, which equipped them with surplus capacity in the peak year 1929, while the increased investment in motor vehicles and roads, 1929 over 1923 was $32,117,000.000. Uniform principles of taxation should be adopted by the States so that highway users would contribute the maximum amount of tax funds consistent with utilization of the roads. Protection of the public likewise demands uniform regulation of size, weight and speed of motor vehicles. The future of the railroads lies in co-ordination of their points of superisuperior ority with those of the truck, thus providing an economic service be better served and the highways relieved to either. The public would directed be railroads should efforts of the The congestion. of much useless towards these ends. Deposits of Mutual Savings Banks in New York State Gain in New York—Total on Nov. 30 1932 $5,250,146,495, Compared with $6,163,646,189 Nov. 30 1931. Mutual savings banks in New York State revealed in their report on November transactions a better condition than prevailed in 1931, according to the Savings Banks Associajust completed tion of the State of New York, which has tabulations from its 142 member banks. The Association $5,250,146,495, states that total deposits Nov. 30 1932 were Jan. 7 1933 and on Nov. 30 1931 they were $5,153,645,189. New deposits during the month were $105,155,675 and withdrawals were $112,220,242. The outgoing money exceeded the incoming by $7,064,567 and compared favorably with excess withdrawals in 1931 of $7,494,623, according to Association officials. Special savings in Christmas clubs, paid out in November, account for $3,651,458 of these excess withdrawals, with still more money to be paid out in December from these special accounts. The pick-up in new accounts which started in September is still going on, according to Henry R. Kinsey, President of the Association. During November an excess of new accounts over closed accounts of 7,453 maintained this September-October trend. New York State Commission for Revision of Tax Laws to Recommend to Legislature Businesslike Organization of County Government. Businesslike organization of County government will be the first recommendation of the New York State Commission for the Revision of the Tax Laws which is now in session in New York City preparing its final report for submission to the legislature. This Commission was appointed by the Legislature and the Governor in 1930 to deal with the equalization of the tax burden, a task which was later extended to include the question of efficiency in local government. The Commission reports: From Buffalo to New York, and from Broome County to Clinton County. the people of this State are in revolt against the ineffic!ency of county government. Why? Because the county government of New York State is not properly designed to meet modern conditions. The general framework of county government was established before New York became a State in 1777. The only significant changes since that time have been the addition of the auditor, the district attorney, the superintendent of highways and the welfare officials. The Commission calls special attention to the fact that each one of these County officers which has been set up since 1777 has been added to the County government without any reorganization of the rest of the machinery of the county. "County government to-day is like an old barn to which one lean-to after another has been added until the whole thing is likely to collapse of its own weight." An announcement issued in behalf of the Commission also says: The county government in New York State consists of a large number of elective officers who are quite independent of each other and the board of supervisors. In addition, there are various semi-independent boards and the county judicial officers. Among the elective officials are the sheriff, the district attorney, the county judge and surrogate, the county Clerk, and the members of the board of supervisors, all of whom are provided by the State constitution. In addition, there are certain statutory officers, such as county treasurer, coroners, commissioner of public welfare, the commissioners of elections, the board of child welfare, superintendent of highways and various others, which vary from county to county. This general framework of county government exists throughout the State in big and little counties, in rich and poor counties, and in urban and rural counties. The only exception is New York City, where the five counties are, to a slight degree, consolidated with the city government.. The county budget is made and adopted by the county board of supervisors, who also appoint most of the non-elective officers of the county and make the county tax equalization. The members of the board of supervisors are elected by towns, and in case of city representatives by wards. The town supervisors, in addition to being members of the county legislative body, are the chief executive officers within their own towns. County government in New York State has certain strong points and certain weak points. Its chief advantage is to be found In the fact that the county government is In thorough touch with the towns through the system of making the county legislative body out of the executive officers of the towns. In the opinion of the Commission, this advantage, however, is more than counteracted by the weaknesses of the New York county system. The Commission says: Our county government is unsatisfactory and inefficient under present conditions because: 1 The county has no executive. It has a half a dozen or more Independent executives with no one in general charge to make plans, to prepare the budget, and then to see that the work is done. It is not possible either In public or private affairs to get efficiency without a chief executive. 2. The county legislative body is now made up of town executives. If there is one thing which we have learned in New York State it Is the necessity of eliminating the executive officials from the rank and file of legislative and appropriating bodies. Legislative bodies should represent the people and not the spending officials or the bureaucracy. Wherever officials who spend money are utilized on legislative bodies and are called upon to prepare budgets, levy taxes, and determine the details of governmental work, they inevitably spend more money. There are only five States which have adopted the New York State Idea of utilizing town officials to govern the county. These are: Nebraska, New Jersey, Michigan, Wisconsin, and part of Illinois. In every case the result is extremely unsatisfactory. In Illinois, where both the New York State system and the county commissioner system are In operation side by side, it has been shown, after careful investigation, that there are more than three times as many elective officials, that the cost per square mile of arta is 97% greater, and the per capita cost of government is 108% greater in the counties under the township system as compared with comparable counties under the county system. These costs deal purely with general overhead administration, inasmuch as highway and educational expenses were eliminated in the comparison. 3. The uniform system of county government does not fit the ununiform conditions of the State. For example, in New York City there should be no county government. The big counties, the little counties, the poor counties and the rich counties need county government charters which vary just as much one from the other as do city charters within the State. Volume 136 Financial Chronicle To meet this situation, the Commission will recommend to the legislature two important bills. The first bill will propose two optional forms of County Government reorganization. The second bill will propose an amendment to the State constitution opening the way for the complete reorganization of County Government within the State. It is further announced: The optional plans of county government reorganization under the present situation will be known as county government plans A and B. Plan A provides for a county president to be elected by the people for a four-year term. The county president will be the chief executive officer of the county in so far as this is possible under the antiquated provisions of the State constitution. He will prepare the county budget and will be responsible for carrying it out after adoption by the county board of supervisors. Plan 13 provides for a county executive to be appointed by the county board of supervisors without fixed term. The county executive under this plan will appoint and supervise all nonconstitutional officers and will prepare and executive the budget after its adoption. Neither of the plans can alter the make-up of the board of supervisors as this Is established by the State constitution on the model of 1777. It is to deal with this problem that the Commission is proposing an amendment to the constitution. This amendment to the constitution will provide for county home rule, in accordance with which the voters within the county can, on petition signed by 15% of the electors, bring to a vote a new county charter. The Commission's amendment will aiso remove restrictions of the present constitution so that the State Legislature can, by general law, transfer town functions to the county where desirable and re-establish the board of supervisors as a genuine legislative body representative of the county. While the main purpose of the Commission in bringing forward this program is to lay the groundwork for efficient county government, the Commission maintains that this program will also eliminate between 50 and 100 laws a year from the State statute book, laws which deal with matters which can and should be handled not by the State Legislature, but by the counties themselves. Senator Seabury C. Mastick is Chairman of the New York State Commission for the Revision of the State Tax Laws. Fifth Annual Mid-Winter Meeting of New York State Bankers' Association to Be Held in New York on Jan. 20. The fifth annual mid-winter meeting of the Association will be held in New York City on Friday, Jan. 20 1933. The first event of the day is the annual lunch given for the bankers of the State by the directors and officers of the Federal Reserve Bank of New York, 33 Liberty Street, in the bank's dining room at 12:30 p. m. After lunch, the business meeting will be held in the Auditorium of the bank at 2:00 p. m. Current banking problems will be discussed by Francis H. Sisson, President of the American Bankers' Association and by George V. McLaughlin, Vice-President of the Association. William K. Payne will report on progress made in the organization of Regional Clearing Houses during the past year. William S. Irish will report on Federal legislation and James H. Perkins will report on State legislation. The banquet will be held at the Roosevelt Hotel, Madison Avenue and 45th Street, at 7:45 p. m. The president of the Association is H.H.Griswold, President of the First National Bank & Trust Co., Elmira, N. Y. The headquarters of the Association are at 33 Liberty Street, New York. Board of Governors of Investment Bankers' Association of America to Meet Jan. 20-21 at Absecon, N. J. The call for the annual January meeting of the Board of Governors of the Investment Bankers' Association of America was announced at Chicago on Dec. 29 by Frank M. Gordon, President of the Association and Vice-President of the First Union Trust & Savings Bank of Chicago. The meeting will be Jan. 20 and 21 at Absecon, N. J., and will be the first session of the Board following the election of a new President and other board members at the annual convention in October. The purpose of the meeting is chiefly to consolidate the Association's work for the coming year under the new administration. Attendance will be limited to members of the Board and to Committee Chairmen and other Association members who may be called on for reports. This will be the 77th meeting of the Board of Governors since the Association was founded in 1912. Blind May Draw Checks in Braille, According to Bank of Manhattan Co. The first check ever written in "braille," the raised dotand-dash writing of the blind, has recently been cashed by Bank of Manhattan Co. (New York). This acceptance marks a forward step of the first importance for the blind and their financial problems, according to Augustine J. Smith, philanthropist, who made the experiment. Mr. Smith, who is a member of the Board of Managers of the New York Institute for the Education of the Blind, had the cheek drawn in braille, signed it, and presented to the bank. There was some hesitation in paying it, since braille can only be read by those who have studied it. "The same would be true of Chinese or Arabic," said Mr. Smith, "but 85 checks in Chinese or Arabic characters would be negotiable instruments." Officials for the bank studied the question and decided that the check was "in writing signed by the maker," and that braille is "writing" or "printing" within the legal meaning of those terms. The use of braille in writing checks, Mr. Smith points out, is the only protection available to the blind, since a blind person signing an ordinary check cannot know what may be written thereon. ITEMS ABOUT BANKS, TRUST COMPANIES, &c. The statement of condition of Sterling National Bank & Trust Co. of New York City as of Dec. 31 1932 shows total resources of $14,032,736 as compared with $11,832,361 a year ago. Deposits are reported as $10,646,994 against $8,123,886; cash on hand and due from banks is $2,623,413, compared with $3,060,399; holdings of United States Government bonds are listed as $5,073,482, against $3,085,918. Capital remains unchanged at $1,500,000, with surplus and undivided profits amounting to $1,017,359, as compared with $1,519,033. Reserves are reported as $105,184, against $9,444 a year ago. Arnold F. Smith, Vice-President and director of the Seward National Bank & Trust Co. of New York at the time it became a branch of the Bank of Manhattan Co., died on Jan. 3. He was 45 years of age. After an association of forty-two years with The Chase National Bank of New York, William E. Purdy, Vice-President, is retiring to private life. Mr. Purdy was one of the Charter Members of New York Chapter, American Institute of Banking, and of the Association of Reserve City Bankers. He has also served as a member of the Executive Council of the American Bankers Association and on several of its committees, and has a record of attending twenty-eight consecutive annual conventions of the association. Through the contacts thus formed, Mr. Purdy has built up an extensive acquaintance among bankers in every part of the country. The statement of The Chase National Bank for December 31st 1932, shows the following changes in important items since September 30th, the last previous statement date. Total resources amounted to $1,856,290,000 as compared with $1,855,617,000 on September 30th; cash in the bank's vaults and on deposit with the Federal Reserve Bank and other banks, $391,297,000 as compared with $377,211,000; investments in United States Government securities, $214,996,000, as compared with $249,899,000; securities maturing within two years, $116,305,000, as compared with $120,394,000; other bonds and securities, including stock in the Federal Reserve Bank, $115,400,000, as compared with $90,371,000; loans and discounts, $887,187,000, as compared with $860,924,000. The capital of the bank at $148,000,000 is unchanged; surplus $100,000,000, unchanged; undivided profits $11,131,000, as compared with $18,335,000; reserve for taxes, interest, contingencies, etc., $15,937,000, as compared with $14,541,000; deposits, $1,466,039,000, as compared with $1,420,221,000. The statement of condition of the Guaranty Trust Company of New York as of December 31 1932, issued Jan. 4, shows deposits, Including outstanding checks, totaling $1,038,778,217, which compares with $1,002,027,142 at the time of its last published statement September 30 1932. The company's capital, surplus, and undivided profits total $271,233.494, consisting of $90,000,000 capital, $170,000,000 surplus and $11,233,494 undivided profits. The latter figure shows an increase of $403,261 over the figure published at September 30 1932, and $737,761 over the figure published at June 30 1932, but $13,725,544 less than the figure published, December 31 1931, due to the amount appropriated by the Board of Directors out of undivided profits, as announced June 1 1932, for the purpose of strengthening the reserves of the company. The company's total resources are $1,410,786,974. Its cash on hand, in Federal Reserve Bank, due from banks and bankers, and its ownership of U. S. Government obligations totals $724,962,884. A merger of the Harlem Savings Bank and the Commonwealth Savings Bank went into effect at noon on Saturday, December 31, the announcement following approval by the State Banking Department and the boards of trustees of both banks. With resources of $108,000,000, the enlarged bank, which will retain the name of the Harlem Savings Bank, will, it is claimed, be one of the twenty largest mutual savings banks in the United States. Deposits are reported as $92,000,000 and surplus as $16,000,000. There are 104,000 86 Financial Chronicle depositors. The Harlem Savings Bank, located in 125th Street at Lexington Avenue, was organized 70 years ago and had never previously figured in a merger. The Commonwealth Savings Bank was established In 1910 and has offices at Amsterdam Avenue and 161st Street and at Broadway and 180th Street. The personnel of all three offices will be retained. Edwin Tatham, President of the Northern Westchester Bank of Katonah, N. Y., died of heart disease on Jan. 1 in his apartment at the Bedford, 118 East Fortieth Street, New York City, after a short illness. Mr. Tatham, who was 74 years old, was the son of the late Benjamin Tatham, founder of the manufacturing firm of Tatham & Bros., which later merged with the National Lead Co. He was graduated from Stevens Institute of Technology in 1881 and for years was consulting' engineer to his father's firm and the National Lead Co. In 1918 he and a group of friends organized the Northern Westchester Bank, with Mr. Tatham as President, the Office he held at the time of his death. The deceased banker was a member of the University, Century and Colony clubs. •__. Statement of the National Shawmut Bank of Boston, Mass., for Dec. 31 1932 shows the following changes in important items since the June 30 1932 statement: Total resources have increased to $201,127,473, as compared with $186,361,740 on June 30; cash on hand in Federal Reserve Bank and on deposit with other banks has increased from $26,541,512 as of June 30 to $44,149,180; investments in United States Government securities are $49,230,972, as compared with $27,547,334. These latter two items alone—cash and United States Governments— on Dec. 31* represent 75% of the demand deposits; loans, discounts and investments are $60,463,642, as compared with $67,836,850 as of June 30. The capital stock of the bank is unchanged, amounting to $20,000,000; surplus and undivided profits, after dividends, are $100,000 in excess of Dee. 31 1931. The reserve for quarterly dividend was $400,000, unchanged from the previous statement. Deposits increased from $142,848,146 in June to $158,082,661 as of Dec. 31. The People's National Bank of Stamford, Conn. (capitalized at $150,000) was consolidated on Dec. 31 1932 with the First-Stamford National Bank & Trust Co. of that city (capitalized at $1,000,000), and all business of the two institutions is now being transacted by the latter. Stamford advices on Jan. 1 to the New York "Herald-Tribune," authority for the foregoing, went on to say: Clarence E. Ailing, President of the Peoples National Bank, explained that his bank had operated profitably despite the depression, but had deemed a merger advisable to cover the shrinkage in assets caused by depreciation of securities. He said that the depositors now would be assured of complete protection. Clarence W. Bell, President of the First-Stamford National Bank & Trust Co., said the merger had the approval of the Stamford Clearing House Association. Resources of $2,274,543 were reported on Oct. 8 by the Peoples National Bank, of which $533,528 was in stocks and securities and $271,309 In Government bonds. Resources of the First-Stamford National Bank at that time were $11,183,944. At a meeting of the directors of the Provident Trust Co. of Philadelphia, Pa., on Dec. 29, William R. K. Mitchell, Treasurer of the institution, was given the additional title of Vice-President, as reported in the Philadelphia "Ledger" of Dec. 30. Mr. Mitchell, it was stated, went to the Provident Trust Co. from the Wharton School nearly 20 years ago. In 1924 he was appointed Assistant Treasurer, and in 1928 was advanced to Treasurer. He was engaged in active service as a Captain in the World War. James Clark, Chairman of the Board of Directors of the Second National Bank of Cumberland, Md., and President of the Cumberland Brewing Co., died on Dec. 29 following a stroke of paralysis suffered Dec. 24. Mr. Clark, who was 86 years of age, was born of Irish parents aboard ship, coming to this country. His parents settled in New Jersey, but subsequently moved to Winchester, Va., where the son enlisted in the Confederate Army. In the early seventies Mr. Clark went to Cumberland, where he engaged in the shoe business. In 1883 he bought the Braddock Distillery, which was built in 1856, and established the James Clark Distilling Co. He later became interested in the Cumberland Brewing Co., the Presidency of which he held at the time of his death. Jan. 7 1933 The recent closing of a small Virginia bank was reported In the Richmond "Dispatch" of Dec. 28, as follows: The Rappahannock State Bank at Sharps has suspended operations pending arrangements for selling the institution, it was announced yesterday (Dec. 27) by M. E. Bristow, State Banking Commissioner. The bank was closed late last week and Mr. Bristow said a settlement of its affairs is expected within the next few days. F. C. Booker le President of the bank and H. D. Cunningham is Cashier. Its capital was listed at $10,000. According to a press dispatch from Lima, Ohio, on Dec. 15, the Farmers' Bank of Elida, Ohio, was reopened on that date, releasing $18,000 in depositors' funds, which had been held since the bank was closed on July 29 1931. The dispatch furthermore said: Capitalized at $25,000, the institution is locally owned and managed. It is the first closed bank in Allen County to reopen, apparently without loss to the stockholders or the 500 depositors. A press dispatch from Ottawa, Ohio, on Dec. 14 1931, printed in the Toledo "Blade," stated that an initial dividend of 10%, amounting to approximately $15,000, would shortly be paid to depositors of the People's Exchange Bank of Ctlumbus Grove, Ohio, which closed a year ago. The advices went on to say: The Common Pleas Court Tuesday (Dec. 18) approved distribution of the funds. Those in charge of the institution said steps would be taken to borrow the $15,000 from a Columbus bank. The Indiana State Bank & Trust Co. of Warsaw, Ind., failed to open for business on Jan. 3, according to Associated Press advices from that city, which added: A notice posted on the door said the bank was closed by order of the directors. W. F. Maish is President of the bank, which was capitalized at $200,000. Its last report showed deposits of $1,421,000. The opening of a new banking institution at Bluffton, Ind., on Jan. 2, under the title of the Farmers' & Merchants' Bank, in a building formerly occupied by the Wells County Bank of Bluffton, was reported in advices from that place on the date named, which went on to say: The new bank has a State charter and will operate with a capital stock of $25,000 and a surplus of $7,000. The new bank is virtually a reorganization of the Craigville State Bank. David Elopfenstine is President, Gideon Gerber and Fred J. Tangeman, Vice-Presidents, and Gideon Gerber, Cashier. A. G. Matthews, a well known Indiana banker, retired as President of the Second National Bank of Richmond, Ind., after 55 years of active banking, on Dec. 31, according to a dispatch from Richmond on Dec. 29 to the Indianapolis "News," which furthermore said in part: Mr. Matthews came to Richmond fifteen years ago from Muncie, where he had been Vice-President of the Merchants' National Bank, to serve as Vice-President of the Second National here. He was named President three years ago. Matthews, at the age of seventy-four, with fifty-five years of active banking to his credit, announced despite protests of members of the Board, that he would use the rest of his life for recreation. In accordance with a resolution adopted by its directors to close the institution and liquidate its affairs, the South Central State Bank of Chicago, Ill., located at 79th and State Streets, ceased to operate at the close of business on Dec. 29 last and the following day the depositors were notified to call at the institution and withdraw their deposits. The Chicago "News" of Dec. 30, from which the foregoing is learnt, continuing said: ir The South Central State was opened Dec. 15 1928 and at its peak had deposits of $400,000. These subsequently were reduced by 80% as $ result of withdrawals during June a year ago and In June this (last) year. IS Directors stated that in view of present business conditions It was felt proper step liquidation was the only to take. The safety deposit !madness will continue to be operated. IS During the last two years the South Central State has been under the active management of J. H. Dolg. Executive Vice-President. The Liberty Bank of Chicago, Chicago, Ill., a newly organized institution, with capital of $300,000 and surplus and reserves of $200,000, at the close of business Dec. 29 1932 assumed the deposits of the Liberty Trust & Savings Bank at Kedzie Ave. and Roosevelt Road, Chicago, and is operating at that address, according to the Chicago "News" of Dec. 30. The new institution, which is an affiliated member of the Chicago Clearing House Association, begins business, it Is said, in a highly liquid condition, having cash alone of over $1,900,000 and no bills payable. The personnel of the new bank includes Walter M. Heymann, Chairman of the Board, Carl L. Jernberg, President, and William GI. Dooley, Vice-President and Cashier. Deposits, the paper mentioned said, totaled $3,529,242. The Chicago "News" of Dec. 30 stated that Frank W. Delves,former Vice-President and Cashier of the State Bank of Chicago, had been appointed an Assistant Cashier of the Terminal National Bank of that city. Gaylord S. Morse, Volume 136 Financial Chronicle President of the Terminal National Bank, was reported as saying that Mr. Delves has had more than thirty years' of banking experience in Chicago. Announcement was made this week by M. L. Straus, a Vice-President of the Straus National Bank & Trust Co. of Chicago, Ill., that the name of the institution has been changed to the American National Bank & Trust Co. of Chicago. In reference to the change, Mr. Straus said: "The management feels that the new name is indicative of the scope of the bank's activities, which are broad, varied and widely diversified. "For a long time we have felt that this bank should be known by a title which would convey to the public the extent of its business, its balanced personnel and the inclusion among its customers of varied types of industrial, commercial, savings, and trust accounts. We wanted a name that would express in as broad a manner as possible its usefulness as its business continued to expand. "As the American National Bank & Trust Co. of Chicago, the same management will direct the institution and maintain the policies that have served this bank so well. Customers will continue to transact their business with all departments without any change in arrangements. "It is a satisfaction to the officers that this institution enjoys the confidence of a wide and varied list of conservative business concerns. Organized as a National Bank under Government control, it has met changing economic conditions by keeping its resources in an unusually liquid condition, as indicated in the statements published when called for by the Comptroller of the Currency at Washington. "Looking back over the stressful months of the past year we find in the confidence shown by our customers the reward of conservative direction. We think the change will meet general approval and accordingly begin the New Year as the American National Bank tz Trust Co." — The Gibson City State Bank at Gibson City, Ill., an institution which has been in existence for forty years, was closed on Dec. 29 for adjustment and reorganization, according to advices from Gibson City on that date to the Chicago "Tribune." The closing left only one other bank In Gibson City, the First National Bank,it was stated. Subsequent advices by the Associated Press from Gibson City, Jan. 3, stated that the Mayor, Herman C. Krudnp of Gibson City, had declared a 30-day banking holiday because of heavy withdrawals from the First National Bank. In his proclamation Mayor Krudup said: "It is deemed expedient for the public welfare to suspend all banking business within Gibson City for a period of thirty days." The dispatch also stated that M. C. Mattison, President of the First National, had left for Washington to submit to the United States Comptroller a plan for refinancing the bank. The Third National Bank of Mount Vernon, Ill., of which Louis L. Emmerson, former Governor of Illinois, was President, closed its doors by order of its directors on Jan. 3. It was the only bank in the place. Associated Press advices from Mount Vernon, authority for the foregoing, furthermore said: Cashier E. A. Vonarb said the action was taken to protect depositors after a heavy "run" Saturday as a result of the closing of the RidgelyFarmers State Bank of Springfield, of which (former) Governor Emmerson was a director. The Cashier said the bank had more than $250,000 in cash on hand. The bank had deposits of $2,279,407.49 and resources of $2,781,000 at the close of business Saturday. It was capitalized at $150,000 and had a surplus of $145,000. Advices by the United Press from Herrin, Ill., on Dec. 31 stated that the First National Bank of Herrin, the only bank in the city, had failed to open on that day, and that Federal bank examiners had taken charge of the institution, after working on the bank's books the previous night. We quote furthermore from the dispatch as follows: A notice appeared on the door of the bank to-day (Dec. 81) "Closed by order of the Comptroller of Currency and placed in reading: hands of Ben Sneeden, receiver." The last statement of the bank showed deposits of $1,136,000. Time deposits were listed as $1,023,939.76, and demand deposits as $112,141.90. The bank had a capital of $50,000 and a surplus of $25,000, the statement showed. The State Savings Loan & Trust Co., of Quincy, Ill., did not open for business on Dec. 31, according to advices by the United Press from that city on the date named, which went on to say: The hank is said to have had deposits in excess of $1,000,000, having been reopened only recently after a reorganization. The Ridgely-Farmers' State Bank of Springfield, Ill., depository of State funds, and of which Governor Emmerson of Illinois is Chairman of the Board of Directors, was closed on Dec. 30 "for examination and adjustment," according to Associated Press advices from Springfield on that day. The dispatch, continuing, said: Other information than that was refused by State Auditor Oscar Belson at the request of the directors. At State Treasurer Barrett's office the chief clerk said that there were "no unsecured State deposits" in the bank, and that the amount of "secured deposits was relatively vandl." 87 Three other Springfield banks were besieged with depositors demanding their money. AU three announced that depositors would be paid as rapidly as the bank tellers could do it. The Ridgely-Farmers' State Bank of Springfield, Ill., of which Governor Emmerson is Chairman of the Board of Directors, was closed on Dec. 30, according to Associated Press advices from that city. According to the bank's last statement of condition, Sept. 30 1932, the institution is capitalized at $600,000, with surplus and undivided profits of $250,707 and deposits of $4,616,233. A disbursement of 36% to those depositors who have filed proof of claims has been authorized by Elmer 0. Ericson, receiver of the Ravenswood National Bank at Ravenswood Park, Chicago, Ill. The Chicago "News" of Dec. 27, from which this is learnt, furthermore said: The payment will be from funds accumulated by the receiver, supplemented by a loan from the Reconstruction Finance Corporation. The Reconstruction Finance loan must be repaid and there will be no further disbursements until this is done. Funds of the Reconstruction Finance Corporation applicable to loans to closed banks are limited, and the claimants of the Ravenswood National are fortunate that the receiver has been able to secure a loan at such an early date. Not all depositors have filed proof of claim, according to the receiver. The closing of the institution on June 24 last was noted in our June 25 issue, page 4606. On Dec. 23 payment was announced of a dividend of 5% to depositors of the Lyons State Bank at Lyons, flL, by the receiver, Francis Karel. An initial dividend of 15% was paid last year. The Chicago "News" of Dec. 23, reporting the matter, furthermore said: The bank was closed June 27 1981, with $241,774 due creditors. Total resources at the time of closing were $269,426. 5_ It is learnt from the Detroit "Free Press" of Dec. 26 that Circuit Judge Joseph A. Moynihan signed an order on Dec. 24 to permit the reopening within two weeks of the Lapham State Savings Bank, of Northville, Mich., and to permit the bank's receiver to pay off depositors who have objected to the reorganization plan. The paper mentioned, continuing, said: According to E. W. Nelson, State Bank Examiner, the bank will merge with the Northville State Savings Bank, also in receivership. Both have been closed for a year. Nelson told the Court Northville could support only one bank successfully, and that the joining of the two would create a substantial institution. —4_ The appointment of Leonard Reaume and A. A. Chapp, as Vice-President and Assistant Treasurer, respectively, of the Detroit Trust Co. of Detroit, Mich., was announced by McPherson Browning, President of the institution, on Dec. 29, according to the Detroit "Free Press" of the following day, which went on to say: Mr. Resume came with Detroit Trust Co. Oct. 1 1930, to take charge of the handling of real estate managed by the company in its various capacities. He is a past President of the Detroit Real Estate Board and a past President of the National Association of Real Estate Boards. For many years Mr. Resume has been a prominent figure in Detroit real estate circles. As assistant treasurer, Mr. Chapp will continue with his duties in personnel management. He has been with Detroit Trust Co. since May 1927, prior to that time having been in the banking business for 10 years as Auditor and Manager of personnel. 5— According to the "Commercial West" of Dec. 31, changes in the personnel of the First National Bank of Graceville, Minn., at the first of the year, include the appointment of J. A. McRae and S. R. Hammer, as Vice-President and Cashier, respectively, and the resignation as Assistant Cashier of Edward Gettman to join the Regional Agricultural Credit Corporation. The paper mentioned went on to say: Mr. McRae has been in the banking business in Graceville for 40 years and Mr. Hammer, more recently with the First Bank Stock Corp., from Litchfield. A press dispatch from Kenyon, MI1112., on Dec. 24, printed in the Minneapolis "Journal," stated that plans were being made by local business men for the organization of a new State bank in that place, "designed to care for business and financial demands which have suffered since the closing of the village's last bank, the State Bank of Kenyon, Oct. 6." The Union Savings Bank & Trust Co. of Davenport, Iowa, announced on Dec. 27 that it would liquidate with an immediate dividend of 40c. on the dollar, obtained through a loan from the Reconstruction Finance Corporation. A Davenport dispatch, printed In the Chicago "Journal of Commerce," from which the above information is obtained, furthermore said: Additional dividends will be paid depositors as rapidly as the assets are liquidated, 88 Financial Chronicle The Union Bank had about $15,000,000 in deposits. Two small Davenport banks and the Betters:tort Savings Bank also closed Tuesday (Dec. 27), leavong the recently organized Davenport Bank & Trust Co. as the city's only remaining bank. The Davenport Bank tz Trust Co. has about $10,000,000 of deposits. Its officials said it is highly liquid and capable of paying out all of its deposits 100% if the depositors wish their money. According to a dispatch by the Associated Press from Arlington, Neb., on Dec. 13, depositors of the defunct First National Bank of Arlington were to receive a dividend on Dec. 14 and 15 1932 of 25%. The First National Bank of Comanche, Okla., capitalized at $25,000, was placed in voluntary liquidation on Dec. 16 1932. The institution was absorbed by the Security State Bank of Comanche. The Hartshorne National Bank at Hartshorne, Okla., capitalized at $50,000, went into voluntary liquidation as of Dec.4 1930. It was succeeded by the Bank of Hartshorne. Depositors in four closed Missouri banks were paid dividends on Dec. 24 amounting to $76,000 by C. A. Greenlee, district bank liquidator, according to Associated Press advices from Mexico, Mo., on that date. The institutions named were as follows: North Missouri Trust Co. of Mexico; Citizens' Bank of Wentzville in St. Charles County; the Harrisburg Bank at Harrisburg, and the Bank of Ashley at Ashley in Pike County. The closing on Dec. 27 of two Missouri State banks was reported In the following dispatch from Jefferson City, Mo., printed in the St. Louis "Globe-Democrat": Two small bank failures were reported to-day (Dec. 27) to State Finance Commissioner D. R. Harrison. One is the People's Bank of Westboro, Atchison County. An officer of the bank committed suicide last Friday (Dec. 23) and the institution was closed after an examination by Bank Examiner R. E. Shelby. The bank had total resources of $65,231, deposits of $42,693 and loans totaling $51,212. The other is the People's Bank of North Kansas City, Clay County. This was closed by order of its directors and an examiner is in charge. This bank had total resources of $167,457; capital, $25,000; surplus, $5,000; loans, $134,110; deposits, $122,830, and bills payable, $13,000. Rudolph Schroeder is President and C. B. Fox, Cashier. A dispatch to the Louisville "Courier-Journal" from Falmouth, Ky., on Dec. 29 1932, stated that a new banking institution, the Falmouth Deposit Bank, had that day been granted a charter by James R. Dorman, State Banking and Securities Commissioner for Kentucky, according to Tom Crotty, President of the new bank, and would open for business on Dec. 31. Continuing the dispatch said: Using many of the assets of the old Pendleton Bank of Falmouth, which was closed Nov. 3 1931, the new institution wll liquidate the affairs of the Pendleton Bank, Mr. Crotty said. The Pendleton Bank, which was capitalized at $83,000 and had a surplus of $83,000, had deposits of $1,385,000 when it closed, Mr. Crotty said. The Falmouth Deposit Bank will use the building of the Pendleton Bank, but none of the officers or employees of the closed institution will be connected with the new one. The new bank has paid-in capital of $25,000 and surplus of $10,000, Mr. Crotty said. Floyd A. Thomason will be Cashier and F. W. Stitch will be Vice-President. . . . Ian. 7 1933 branches, according to a New Bern dispatch on that date, appearing in the Raleigh "News and Observer," which went on to say, in part: Decision to open the Bayboro unit came last night (Dec. 19) at the urgent request of Pamlico citizens, following the decision last Friday to start a New Bern unit, taking over the new business of the Eastern Bank & Trust Co. N. S. Calhoun, President, ad other bank officials, as well as Gurney P. Hood, State Commissioner of Banks, and other representatives of the State Banking Department, were here for the opening. . . Thomas W. Steed, formerly Assistant Cashier of the banks' unit at Burlington (N. C.), is in charge of the local unit. According to a press dispatch from Boston, Ga., Dec. 23, printed in the Atlanta "Constitution," another dividend was to be paid on that date to depositors of the closed Merchants' & Farmers' Bank of Boston, as announced by J. M. Council, liquidating agent of the institution. The dispatch, continuing, said: This is the fourth dividend to be paid depositors since the bank closed Dec. 80 1930, and is for 5%, bringing the total amount paid depositors to 40%. A charter was issued by the Comptroller of the Currency on Dec. 23 for the First National Bank of Sulphur Springs, Sulphur Springs, Tex., capitalized at $50,000. J. E. Buford Is President of the institution and B. C. Cain, Cashier. The new bank succeeds the First National Bank in Sulphur Springs. Associated Press advices from Cheyenne, Wyo., on Dec. 21, stated that depositors in the savings department of the defunct First State Bank of Laramie, Wyo., on Dec. 23 were to receive a dividend of 10%, according to an announcement by William Reeves, State Bank Examiner. The dispatch went on to say: The dividend payment will approximate $18,500, Reeves said. It will be the second 10% dividend paid the savings deporitors. Bank of America National Trust & Savings Association (head office San Francisco, Calif.), reports net earnings of $4,329,000 for the six months ending Dec. 31 1932, and an Increase of $90,354,000 in deposits since March 12 1932, as indicated in the year-end statement just issued. A total of $6,016,000, after deductions for depreciation, has been added to undivided profits, bringing the total to $10,588,000. With the addition of this amount, surplus and undivided profits now total $52,338,000. This is exclusive of and in addition to $8,127,000 still remaining in the reserve for losses, contingencies, &c. Bills payable, &c., have been reduced to $11,875,000, a reduction of more than $134,000,000 since March 12 1932. Total deposits of the Bank of America are now $749,658,000. More than 217,000 new depositors have opened accounts during the year. Holdings of United States Government securities have been increased during the period by $12,538,000 to $176,903,000. The 77th annual statement of the Bank of Toronto, Toronto, Ont., Canada, just recently issued, and which covers the fiscal year ended Nov. 30 1932, shows liquid assets The closing of the Pendleton Bank of Falmouth was noted of $61,302,000 equal to over 62% of all liabilities to the in the "Chronicle" of Nov. 7 1931, page 3042. public; $19,831,000 is represented by cash, bank balances The First State Bank of Ripley, Tenn., closed its doors and notes and cheques of other banks; securities total $37,on Dec. 22, following a meeting of its directors held the 275,000, and call loans $4,196,000. The Toronto "Globe" of previous night, when, according to a statement by J. F. Dec. 28, whose review of the report we have quoted above, Hunt, State Bank Examiner, they voted to turn the affairs goes on to say: "Commercial loans show a further contracof the institution over to the State Banking Department for tion of $10,713,000 and are down over 18% for the year. liquidation. A dispatch from Ripley, printed in the Memphis Call loans are also lower by $2,182,000. Securities have in"Appeal," authority for the above, continuing, said, in part: creased by $1,805,000. The First National Bank and the First Savings Bank were consolidated "Deposits are down $12,795,000, the interest-bearing deDec. 30 (1931) under the name of the First State Bank. posits showing a decrease of $10,043,000 and the non-interestThe officers were V. P. Moriarty, President; R. M. Prichard, Vice-President; IT. B. Moorer Jr., Cashier. . . . bearing $2,752,000. The published statement as of June 15 (1932) showed deposits of $236,"The contraction of business in general is reflected in 290.45; loans and discounts, $271,456.45; bonds, stocks, warrants, real lower profits, which amount to $1,044,393 after deducting estate, Arc., $28,900, and cash on hand and due from banks and bankers, $22,463.22. expenses, accrued interest on deposits, and making proviThe capital stock is $25,000. sion for all bad and doubtful debts. After providing for An initial dividend of 20%, amounting to $38,600, was dividends and the usual appropriations for taxes, officers' paid recently to depositors of the defunct Bank of Warren, pension fund and depreciation on bank premises, there remained $64,393 to be carried forward, which increases the at Warrenton, N. C., according to advices from that place on Dec. 17, printed in the Raleigh "News and Observer." profit and loss account from $431,908 to $496,301." The Bank of Toronto is capitalized at $6,000,000 and has a rest The dispatch went on to say: The Bank of Warren closed its doors on Dec. 24 1931. fund of $9,000,000. Bills payable and preferred claims were paid last spring, according to J. A. Dennis, who has been here (Warrenton) since early in the year in charge of liquidating the affairs of the defunct institution. Units of the North Carolina Bank & Trust Co. (bead office Greensboro, N. C.), were opened on Dec. 20 1932 at New Bern, N. C., and Bayboro, N. 0., giving the institution 15 J. E. Leduc, Branch Manager of the Provincial Bank of Canada successively in the Provinces of Ontario and Quebec since 1908, has been appointed General Superintendent of the institution, the head office of which is Montreal, according to the Montreal "Gazette" of Dec. 29. 89 Financial Chronicle Volume 136 PRICES IN 1932 AT THE NEW YORK STOCK EXCHANGE. The tables on the following pages show the lowest and highest prices at the New York Stock Exchange of Railroad, Industrial and Miscellaneous bonds and stocks, and also of Government and State securities, for each month of the past year. The tables are all compiled from actual sales. Under a resolution of the Governing Committee of the Stock Exchange, prices of all interest-paying bonds since Jan. 1 1909 have been on a new basis. The buyer now pays accrued interest in addition to the stated price or quotation. Previous to 1909 the quotations were "flat"—that is, the price included all accrued interest. Income bonds and bonds upon which interest is in default are still dealt in "flat." COURSE OF PRICES OF RAILROAD AND MISCELLANEOUS BONDS. 1932. BONDS November December April February March May June July August September October January Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High RAILROAD BONDS. Ala Gt Southern _ ___- --- __-_ ____ __-1st cons 45 series B 79 8012 83 8012 83 80 83 75 7014 7014 -------------------------------- 71 -7-1- 71 Albany & Susq 1st gu 33.0_1946 _ _ _ _ 6612 6612 _ _ 71 ------------------------72 72 --------65 65 Allegh & West 1st g gu 45_1998 --------71 a "9-2-1, ai's -9-61, 65 90 95 . 4 8114 8118 90 385 85 89 89 _-_--__ ____ ____ ____ ____ 1942 ___ Alleg Val gen guar 48 23 40 40 38 40 37 39 2114 25 40 25,4 ---- ----78 78 --------18 25 26 25 Ann Arbor 1st g 4s__ _July 1995 191-4 28 91 9412 9034 9414 8912 9234 9114 20 2038 20 13% 138 3% 38114 8712 87 92 8414 87% 8534 91 Atch Top & S F gen g 4s__ A995 8512 88 9114 8812 --------8812 86% 86% 78 8712 76 8413 80 8214 8512 8112 88 8612 8612 37412 8212 813 4 8518 8518 1995 Registered 8234 080 8312 8312 8212 8318 81 8012 89 82 8334 77 8312 63 63 74 80 84 78 Adjustment g 4s—July 1995 75 8412 7614 79 80 8558 8034 83 7412 801 08013 8412 82 85 78 8034 70 801g 70 76 82 July 1995 77 885 748 80 7878 85 Stamped 80 80 78 80 72 75 7578 80,2 65 7912 63 78 SO 80 Registered 8312 84 0791.2 879-12 7934 79-3-4 7612 7212 79 60 65 ;69 73 1955 76 62 863 70 82 84 73 80,8 81 79 Gonv 648 of 1909 7912 79 8212 79 8114 7813 8014 77 73 71 -------------------------668 8314 80 78 81 74 79 1955 1905 4s of Cony g 80 80 ----------------73 60 85 _ _ _ _ _ _ _ _ 75 77 62 863 7412 _ _ _ _ ._ _ _ _._ ---- 70 82 1960 74 Cony g 4s of 1910 87 9012 9312 899334 88 891 83 92 68 8178 60 68% 64 68 s76 c87 94 1948 90 93 91 9318 88 Cony deb 416s 83 79 81 --------81 82 79 79 75 _ Rock Mtn Div 1st 4s ser A1965 ____ __-- 8178 82 --------------------------------75 91 8914 9012 90 94 88 91 88 89 88 82 7734 80 8313 81 77 88 8018 83 Trans-Cont Short L 1st 48'58 --------89 89 9113 9412 92 9578 92 9518 9018 89 90 8212 8612 86 86 80 86 91 9214 86 Cal-Aria 1st & ref 43-0 A-1962 8612 9012 8613 8712 90 74 7314 8312 7314 71 71 6412 ----------------6114 8014 At II& Char AL 43is ser A...1944 --------78312 7612 80 85 8014 82 80 -81.12 67 81 83 83 80 85 75 7514 62 6814 64 60 7518 80 1944 79 86 8614 855 8212 90 Oat 30-yr 5s series B - 78 78 _ _ _ _ _ _ _ _ _ _ _ _ _ Atlan City 1st con gu g 48_1951 _ _ iirs if 76 -7-814 a 76% -8-6 77 81 art, -7-6 7 - -6IE8 -7-5- 51574 -7-2- dila -6-8 , -8-5-18 Atl Coast L 1st a 4s__ _July 1952 76 "7-912 76 -8-6 i7158 6414 45 8512 73 65 74 4412 531 5512 74 _ 50 60 70 ____ -_ 70 82 78 75 Gen unified 434s ser A-1964 7534 80 75 4178 45 49 4514 65 25 397k 30 46 5378 6213 52 58 25 50 6412 53 59 59 Louisv & Nosily coil 648-1952 58 64 6014 65 914 2834 40 1612 1612 1834 40 2212 29 22 30 19 15 19 18 2514 16 2608 35 Atlantic & Deny 18t 6 49_1948 23 3014 23 32 25 10 25 9 --------9 16 16 25 10 10 2012 15 1948 29 15% 30 2012 27 29 2d 4s 24 35 -37 36 40 38 40 1834 40 11338 1314 19 15 7 1949 -------------------- ------------7 Atl & Yadkin 1st gu 48 aiT, io 83 _ "9-314 25 95 92 8411 841 If 77,3 73 91 8334 93 9612 If -fi 55 4812 2214 -30 72 6012 74 55 55 48 4812 31 7912 8234 7734 8612 7178 8134 58 7512 8418 82 8538 79 8538 73 8012 7234 7812 07014 76 1948 77 83 Bait & Ohio 1st g 4s -Registered ii 70 32 87 50 77 s8578 -7-1-3-4 55 64 3334 51 5918 6814 5914 68 8534 7914 8412 72 ./ 20-year convertible 4348_1933 -7 --52 648 Stamped (10% pt red) 25 4234 2414 40 55 7112 38 --- 5i if 297 3934 57% -3-9 . ir2 -6-1-1, .6 "6-S34 i& 612 6 Refund & gen 5s series A- i.995 a 7. 84 9234 00 93 8558 917 80 8514 7918 8134 1st g 58 1948 89 9412 8812 9212 8812 9658 7714 89 8312 8012 6712 7938 7718 84 30 4318 2712 40,2 32 42 7934 4612 60 4614 55 7812 6934 77 61 33 4314 5012 67 4213 7012 40 53 1995 65 Ref & gen 6s series C_ 74 50 6014 845 56 go 74 6012 .57 63 747 79 6412 76 7012 64 6914 72 77 365 78 751 79 P L E & W Va Sys ref g-45 1941 69 4018 55 8212 5912 7014 4878 61 5134 70 71 5978 70 .59 6714 70 75 7012 75 6734 80 Southwestern Div 1st 5s_1950 70 808 75 79 35 4718 2134 4512 36 49 45 53 60 56 6018 5134 5718 5034 55% 4734 6212 5708 64 51 52 59 Tol & Cm n Div Ist&ref 4sA '59 50 62 25 3734 2514 3912 2712 4012 37 6112 46 38 53 71 3013 3834 5613 41 53 5078 33 45 2000 59 6912 60 67 Ref 5s series D 2614 8 1518 15 22 2934 4814 25 42 2214 33 253 4 40 35 2612 1518 277 8 27 527 8 3818 67 4812 5512 59 4212 1960 Convertible 45s 78 9112 93 72 71 --------------70 7814 82 83 85 93 96 --------90 94 88 Bangor & Aroostook 1st Si 1943 81 58 51 48 5978 59 65 72 7578 68% 7418 6618 7114 70 7111 65 79 1951 60 65 6138 65 60 6612 5078 60 Con r,f 4s _ 82 8812 82 84 84 8612 --------------------------------87 88 92 91 --------92 1936 91 Beech Creek 1st gu4s 8458 8488 1944 8558 88'2 Rig Sandy 1st 4s c64 - 60 85 6L i ' -7314 - a -fi .-71 16 ii12 633 a " 8i4 &i --ii -Em ii --3Ei2 C -9 6 Boston & Maine 1st 58 A CI967 6712 711 i6 -iti 70 7412 61 67 60 6831 71 78 5214 6038 6514 80 45 5712 45 52 70 77 5934 61 68 77 1955 6913 75 1st mtge 5s series 2 59 63 4612 47 60 7512 67 72 46 60 62 6812 60 63 5334 55 56 87 74 let gold 434s series 3.1-1961 6518 6934 6918 7034 65 5438 55 5414 5414 5414 60 60 60 --------5212 5212 5114 5114 Boston & NY Air List 48_1955 5112 5512 5812 80 5812 75 60% 6013 59 59 Brunsw & West 1st gu 4s_1938 -------------------------------------------------------- 8312 8312 87 90 85 -85 86 -87 88 -88 85 c93 89 ------------------------70 85 Buff Roch & Pitts gen a 5s 1937 87 8914 --- _-_ 8712 90 87 612 i 2 38 3614 78 5512 6214 5034 5734 4012 4712 3058 38 4812 8 40 57 49 51 -58 1957 40 61 Consol 430 43 531; 5818 60 57 75 55 781 66 c81 50 50 50 55 Bur Ced Rap & Nor 1st 53_1934 --------7978 8314 80 8334 70 8012 45 61 8714 9018 83 9018 76 841; 7538 9018 87 90 72 78 7612 7934 7478 80 86 8112 84 8414 8934 7612 85 Canada Sou cons gu 5s A._1962 77 8611 7534 8208 8212 8712 86 8834 08814 9112 80 8938 81 78 7814 8018 74 Canadian Nat 4568--SePt 15' 54 7258 7558 7434 7814 7814 8312 74 81 8178 8734 8812 8938 08818 9114 81 884 8134 88 75 7934 74 76 76 82 Gold 434s 1957 7313 7634 7511 7818 7814 8312 0612 80 8158 881; 8678 8958 8713 9173 7908 8834 8138 c88 7538 82 74 797 733 76 8214 75 80 Gold 44s 1968 7234 76 7334 7734 77 , 8008 83 8218 874 8718 9312 9214 9513 9418 9712 85 9558 8734 921; 58 1969 80 8312 38114 8414 838 90 8214 8618 82 855 8712 94'2 9218 9512 9412 9738 85 9512 8714 9213 Guar gold 5s Oct 1969 3018 f3l., 8008 8438 84 90 S8112 8512 2,1014 C81t 82 88 8234 1411 8838 921 9238 9528 94% 9738 8512 947 87 9131 Guar gold 59 1970 81 8253 8112 8334 8412 881 8234 8578 8034 8534 37934 8234 8178 88 Guar g 4 3is_June 15 1955 75 80 7758 8158 81 797 7914 8308 8418 8938 89 9134 9014 9378 8114 9114 8418 891; 85 8018 8314 7812 8212 77 80 8858 8134 87 Guar gold 430 80 37618 7934 741 7608 7678 8258 38108 8178 868 8878 8818 92 1956 73 7634 7513 7812 78 8314 376 Guar g 4345 7612 8258 8178 8712 8634 8914 8838 9112 80 8908 815i 861, 75 8012 75% 77 1951 --------752 7878 7858 8318 7714 81 ia ------5212 ai -7114 Canadian Nor a f 7, 1940 92 08 941 985 9S18 9913 9308 9912 93 9878 9234 952 9312 100 10014 104 10178 104 10314 1057 9818 1033 99%1021, 99%10308 10108 1041 10414 107% 971 10612 10012 1031 9434 100 _194 9158 97 9458 991 9812 102 9113 10014 9534 99 9412 96 25-year deb if 63-55 9434 978 93 99 911 91% 9512 9213 98 951 9812 9812 100 10-yr 43-5s Febg..15 193. 83 87 85 91 18 9112 9334 9034 9312 9114 93 89 7134 6058 708 06134 678 68 7318 69 4758 57 85018 6718 6438 74 Canadian Pac 4% coup deb 5th 59 638 5708 c6238 6034 6914 5912 6112 0712 59 70 78 6412 7613 6112 642 54 61% 5834 77 375 8613 82 86 8013 8412 76 80 Coll trust 4.359 1916 65 7414 7114 07414 7613 81 861, 70 lis equip tr temp ctfa 7718 8818 8734 9258 9112 93 84 9158 84 86 1944 7714 85 8212 8558 81 70 8218 68 7758 75 77 88 Col trust 5s 78 8312 8214 8678 82 8714 78 8412 7812 82 1954 7034 7714 72 75 8314 6734 7512 6478 8878 6113 6812 6813 78 78 Col trust 45-59 78 8058 7112 777 72 763. 75 7012 7512 73 80 6313 72 60 1960 64 7812 84 7213 80 6134 57 77 0413 56 Carolina Cent 1st con g 48_194 ____ __ 20 21 --------17 20 17 17 17 17 17 17 -, ----r.,17 - 16 87 --891_ Carolina Clinch &0 1st 5s 193 -------- 86 89 89 12 --90 ____ 90 89 - ---- ---------87 7593 - - -88936 ___ 75 75 ---_ ___ 6518 701 8008 7014 s 1st & con 6s series A__ -.195 85 71 72 91 8514 59 -59 - 54 -58 55 60 65 88 94 85 8878 87 8058 87 _. ___1st Carthage & Adir gu 48_198 _ --- ____ 748 75 --------63 63 62 6212 Cent Branch Un Pac 1st 4s 194 io- "4-(1- .:::: .-_-....: .45- -41- -56- -3-8.- --.:_-- -:_-- --...-- -::5212 5212 ----------------40 -4-0 — 3014 55 65 --------65 76 76 75 Cent of Ga Ry 1st g 58 Nov 194 _ --_- 6814 72 c131 c81 -------- 63- -(33- -55- 95- -65- -6-5 67 67 7218 28 33 42 28 3718 14 28 52 4018 48 Consol gold 5s 19 28 30 4814 5312 4212 44% 16 50 4414 19 194 4812 55 44 1718 2512 5 197 Ref & gen 5 3-4s ser B_,,1959 2512 41 _ 1278 16 ___ 30 3113 ____ 15 1618 1912 3934 27 3612 2312 27 357 36 181 1578 2212 5 27 Ref & gen 5s series C_195 2512 38 31 24 3312 19 3613 2434 32 15 _20-12 1212 1613 1112 1734 1534 37 20 -24 __23 33 _ _ _ 5012 5012 -------------------------------- 40 40 ----------------33 40 194 Mobile Div 1st g 59 67 6512 7 6612 6712 68 6512 6112 6112 75 Cent New Eng 1st gu 45-- -196 62 W7-8 17;P-I14 -8111 65 58 34 53% 59 -- .2 -;, 73 60 l 1? 42 4714 40 461 38 46 41 48 3312 55 37 37 Cent RR & Bkg of Ga col g 58'3 45 50 4514 4514 39 4612 40 4014 35- -3-5 -90 9414 92 9334 89 95 85 9334 92 95 Central of NJ gen a 5s-__ _198 90 98 75 89% 94 90 92 77-- -g1:.- 75 84 76 80 79 --------8634 9114 8414 89 --------88 91 851tRegisrd 78 9014 c04 ____ _ 8712 90 ---------------74 74 .,- -,.-- , 7114 7114 75 7612 --„ 7 General 4R 65 65 ___ ___- _ 1987 --- - _ 76 -ici ____ --__ - _ 82 82 7878 -8-212 77 -8-0 75 88 s82 8714 07934 86 Central Pac 1st ref gu 4s._1949 -76 -81-78 s76 7714 -85 068 81 7712 34712 1418 50 69 065 75 7513 751 78 78 Through St L 1st gu g 4s 1954 _ _ "--- 7713 7713 7234 7234 68 75 6512 6512 6512 6512 76 80 80 80 60 68 63 69 58 51 7614 66 1960 a 7314 6134 70 50 59 7812 Guar g 5s 66 34 497 38 5412 54 59 7513 3334 58 7658 7434 79 9914 10112 0908 103 091210178 1534 103 95 10238 10012 103 10112104 10114 10334 102 104 10234 105 103 1047 - 97% 98 ----------------100 10014 --------100 100 --------102 102 10214 1021 9 9512 93 9738 9312 9734 94 9613 9334 1001 8214 89 1992 87 0318 8713 9014 38434 91 gold 43-4s Gen 83 89 Registered-72 8612 70,8 85 83 83 93 93 ----------------96 96 87 87 Registered 8112 841 8114 8612 8212 84 8314 87 79 87 .2 -7212 71 -7-6 73 -77 - -6,5i2 -7-012 -50) 80 -85 8014 83 Ref & impt 4345 ser A---1993 77 84 8214 8558 8114 83 1995 75% 83 '81 8314 8678 80 87 76 88 83 70 75 77 861 74 Ref & Imp 43-5s '13" 761 2 741 60 74 __-------------------------------------- 94 94 1940 9934 9934 9934 9934 -------------------------_ Craig Valley 1st g 5s 87 90 8458 534 i3714 89 90 4 813 80 8112 --------72 79 - 37434 s76 - 74 7 Rich & Alleg Div 1st con 44'89 875 c8012 77% 81 1989 8014 8014 8008 80% --------81 811 7418 84 70 79 70 713 ----------------64 64 2d cons g 48 _ _ _ ____ .. 92 92 _ _ ___ _ _ ____ Warm Spr Val 1st g 5s 1941 __ 3878 -41 45- li- -57i2 163-4 -55i8 -4-1-1-2 -56- "41(2 -if' "iii 46- -4-8-12 42 4738 4112 -44 Chic & Alt RR ref g 3a_ ._1949 40 -47-18 42 -4(i% 421 18 -_ ____ ____ ____ ---- ____ ____ -_-- -___ ____ __-- --Ctfa of dep atpd Apr 1-'31 lot 40 4712 42 4514 45 47% ---- -, 735 7ig14 7918 79% ------------------------7913 7913 879% 7912 • Chic & Alt Ry 1st I 3 3ys..1950 ------------ ------------ -------1 8514 313 88% 8712 90 8408 8708 iii, "g1 80% 84 8,4 8 , Chic Burl & Q—III Div 34,•'49 7912 8378 79 82 81 73 8358 75 78 8114 1948 4 Registered 9412 9118 9658 9212 95 8934 931, 6i --9112 9612 8514 92 Illinois Division 43..- 1949 86 8912 8678 88 88 8934 82% 8814 76 89-34 78 86 1958 84 8818 8213 8508 8414 8858 81 89% 92 , 85 93 8712 92 8712 89% 87 901 8718 78 8634 74 8513 82 857 General 4s 84 8814 8158 8412 813g 8234 74 7518 81 7934 8314 78 80'8 8314 88 84 88 81 86 1977 85 8734 83 85 76 1st & ref 4 348 set B 93 97 1st & ref. 5s ser A 1971 95 97 92 9818 86 9178 82 87 92 97 9658 9912 9258 9714 84 9312 70 8812 8112 8713 8712 95 70 7013 65 65 Chic & East III 1st con 68_1934 65 68 57 60 4112 50 60 70 --------56 6012 57 59 50 60 5014 5014 52 52 1612 13 834 141 Chic & E III (new co) gen 5s '51 12 10 1518 1134 18 14 22 8 1613 1034 12 8 913 934 25 1218 712 1212 7 11 90 901 2 Chicago & Erie 1st gold 5s 1982 8038 8038 80 8612 821 87 ---- ------------ 797 80 80 80 90 91 87 92 90 90 80 89 381 2 27, 314 24 38 31 3212 40 Chicago C:t Western lst 4. logo 47 5634 50 54% 46 5412 04 47 381, 56 48 545k 4034 521, 37 43 s Deferred delivery. c Cash sale. • Negotiability impaired by maturity. Ches & Ohio 1st cons g 53_1939 99 103 Financial Chronicle Jan. 7 1933 1932—Continued. BONDS i January February March April May June July August September OCtOb.r November December Low High Low High Low High Low High Low High Low High Low High Low Iligh Low High Low High Low High Low High Chic Indianap &Louisville 1947 55 5512 5012 55 Ref g 65 r"11 60 60 51 66 38 52 32 32 3278 35 56 60 5112 5112 3614 38 ___ 42 43 Refunding gold 5s 1947 47 47 50 50 46 42 46 48 35 35 --------35 55 ----------------___ 45- -4.5 35 40 lot & gen 5s ser A 1966 2478 30 29 42 35 373s 28 3735 25 2.5 17 24 19 20 21 41 28 375 23 30 13 22 1012 1712 lot & gen 6s ser B___May 1966 28 40 3012 40 36 3934 29 35 18 28 20 23 18 21 25 46 30 4434 2112 34 1612 2134 10 17 Chic Ind & Sou 50-yr 45_1956 ----------------80 80 -------------------------------6813 6812 62 62 ____ ____ 6218 62l8 6112 0211 Chic L Sh & East 1st 410_1969 ____ _ _ __ _ ____ __ ____ _ ____ _ ----- __ _ _ _ ____ _ 88 94 ____ _ 937 8 9812 94 9534 Chic 5111 & St P gen 4s A_ _1989 6772 " 66 5814 --6312 60 8 5 -6614 5712 --67 49 --62 50 -59 5434 -5714 --71 63 6734 5724 -6-i 4812 5712 42 48 Gen g 334s ser 13.- _May 1989 51 51 5358 5414 5312 58 55 5714 -------- 53 53 ____1_ _ 4814 6014 59 62 50 6112 48 61 3612 45 Gen 490 series C 1989 62 70 72 6412 6512 64 69 69 60 6338 57 60 58 6 0 5812 72 653 8 7014 55 67 5312 68 4412 5278, Gen 4 Ms ser E__May 1 1989 502 70 6512 6712 6634 7112 65 71 52 65 52 6012 58 60 5822 72 66 70 59 6712 5478 68 4514 55 4110 series"F"_ May 1989 59 73 65 7012 6612 72 64 71 --------60 60 51 6012 6214 76 66 68 65 65 54 57 57 57 Chic Mil St P & Pac-is 1975 3012 42 3312 3034 2922 3912 24 2912 s 4 2412 1378 23 1412 2234 22 4134 2712 3712 22 32 1914 2612 1334 20 Cony adj 5s 2000 7 1112 834 1131 612 1014 518 7 278 558 275 6 312 634 514 1412 878 1538 3612 1012 5 812 314 54 Chic & No West genl g 314s '87 56 58 61 61 57 61 48 5714 4414 46 41 50 4012 4578 4534 57 5178 5512 4814 5514 46 4834 35 41 Registered _ _ __ _ _ _ ._ __ _ ____ __ _____ ____ _ _ ____ _ 4178 4178 General 4s 1;17 61 "7-Ci 55 -6-6 L3 -6-7-12 55 -6-0 36 -5-412 36 -54- 44 -5-4- 48 70 ____ ____ __-- ____ ____ ____ ____ __-5712 65 4858 54 45 4612 40 45 Stamped 4s 1987 69 70 --------62 65 62 62 5014 55 4614 49 5012 5012 57 70 60 60 Genl 445 stpd Fed inc tax '87 ---------------- 72 72 60 60 597 8 60 50 5812 5914 70 73 72 __ 52i2 -5-212 --"Gen]5s stpd Fed inc tax 1987 67 83 67 7918 77 80 72 ------65 5018 647; 5412 65 50 62 623 8 75 70 74 ____"" 6012 62 48 68 -_--" ;15521-2 Sinking fund deb 5s 1933 62 80 7612 80 7612 85 265 73 55 65 51 63 55 65 6018 80 6414 70 62 65 49 64 5712 47 Registered 60 75 72 72 72 72 -------------------------------60 60 61 64 _ 60 65 15.yr secured g oms___ _1936 7612 87 76 8512 8014 8478 6658 8118 55 67 53 65 5212 67 68 8314 76 80 65 7634 60 -e7ts 49 -66ist & ref R 5s May 2027 47 57 4334 52 33 50 30 35 25 33 1812 2912 17 2334 2314 53 35 48 2212 34 19 2514 15 2058 1st & ref 44s May 2037 37 46 3614 4234 35 4334 2512 3438 2212 2912 1512 26 2014 2178 4632 30 41 16 2114 31 1712 2318 14 19 1st & ref 490 ser C—May 2037 37 46 38 43 35 4312 25 35 20 32 17 27 1618 2112 2114 463s 30 4178 20 31 18 23 1378 1838 Convertible 44s series A1949 2512 39 2612 34 22 3412 1312 22 812 1434 834 1512 818 1638 14 3714 2112 35 16 2612 12 19 934 14 Chic R 1 & Pac Ry gen 4s__1988 6712 80 6518 73 5414 64 68 7535 5858 09 53 63 5518 6612 6712 7214 67 7058 60 69 5712 63 5012 57 Registered __ 68 68 62 6412 -,-- - - -,,- ---Refunding, gold 4s 1939 5134 73 19 69 3212 51"19 34 67 L " 458 88 50 20 3412 2412 3278 297s 59 38 51 30 -43- 2722 "-3712 19 -2778 --Secured 434s ser A 1952 46 6314 5012 5634 4312 57 33 4318 18 30 18 30 2834 5012 2714 4278 2912 3614 2414 3312 1914 25 2378 30 Convertible gold 4999_1960 3012 50 46 35 2712 4434 15 27 10 1578 10 16 10 15 43 17 2034 35 1614 29 1512 2114 9 1614 Chic St L & N 0— Gold 5s 1951 46 46 57 65 651,3 75 72 72 6012 62 -------- 62 62 70 7112 78 78 73 73 6718 6718 71 75 Registered Memph Div 1st 4s 1951 :1Li2 -4'612 .L5 16 56 -56 ----------------4034 -66 ii -66 5 §Ty -61 a -6.- -a "di Chic S L & Pitts 1st con 55_1932 -------- 9914 9958 100 10014 9912 10014 99%100 9938 9978 9978 9978 ---- ---- ---- ---- ---- ---- ---- ---- ---- -Registered Chic Terre ii & S'east 1st 55'60 95i2 -46 ii -4-612 5162 1E 5it 15" 55 -31 30 36 55 -5-8-12 HT.& 59 ii -5-622 45 "al, 45 -SY 33 -41371 Income guar 5s 1960 26 37 28 33 28 34 20 2612 15 2334 14 19 1212 2678 26 49 3914 46 3014 4012 27 32 20 29 Chic Union Sta 1st 43-4s A 1963 90 94 8612 9012 8978 92 86 94 8812 94 8478 00 83 90 89 97 9514 07 95 9814 9618 9778 0278 9859 1st 5s ser B. 1963 9718 10012 9818 100 9012 101 974 101 93 10238 90 100 9012 9834 0834 104 102 104 101 10312 101 10378 10024 10314 Guar g 5s 1944 9478 9814 9424 9578 95 99 95 0812 94 9614 92 94 92 93 92 98,2 98 10014 100 10114 100 10112 100 10114 1st 63-4s ser C 1963 106 109 10658 10818 108 11038 107 11114 105 10912 100 106 10434 110 109 11134 109 11114 11114 11312 11022 11278 11138 113 Chic & W Icons 50-yr 45-.1952 64 79 63', 70 6978 7314 63 73 70 56 55 62 8 61 55 60, 66 72 66 71 76 65 70 62 70 1962 68 8734 7678 82 1st & ref 5 5-8s ser A 82 8512 8212 8514 6518 80 55 59 5512 65 68 85 80 8412 78 8414 75 82 65 81 Cin tiam &Dayton 2d 4995 1937 ---------------- 00 00 --------90 90 ------------------------------------------------82 88 Cin Indianan St L & C 1st 45'36 -------- 91 95 --------93 9312 -------- 71 71 70 7018 --------95 95 9414 0512 9424 9414 9412 9478 Registered 85 85 Cin Leb & N 1st con gu 43_1942 75 75 --------77 -7 -_-_ _ ____ _ ____ ___ ____ _ _ __ . ____ __ ____ __ 72 72 Cin Un Term 1st 4995 2020 85 8712 90 95 93 95 93 93 93 --03 89 -89 83,4 --9278 -8314 51,2 --95 9322 9314 9538 9424 -939212 9112 -4 1st mtge 5s series B w I 2020 96 98 95 9712 97 90 9618 9834 9312 99 94 98 9338 96 96 9934 9712 101 9034 102 10034 102 101 104 Clearf & Bah 1st gu 5s__1943 _ __ _ ____ __ ____ _ _ ____ _ _ ____ -__ _ ___ _ _ __ - 75 75 ----- ----- ---- — Clev On Chic & St L gen 45'93 68 --77 63 -1 75 73 -7312 6638 --- 68 -72- 70 7014 2631 ___- -66 —6418 -6512 7712 7712 7414 75 -77 e 75 -76 73 -77 General 5s series B 1993 Ref & imp 6s ser C 1941 56 -9-9- 55 -9-6 55 "9-5-18 iL -7-8- . 75 -7-5L1E1 -5-1-4 i5 -5-6 55 -6-5- 67 70 70 70 70 70 _- - -_-Ref & imp 5s ser D 1963 68 7512 70 7912 76 84 --------5013 62 48 6212 58 65 5012 40 46 41 48 62 46 54 45 5412 Ref & imp 43-4s ser E---1977 62 7114 65 69 6412 7134 54 614 2814 4614 3478 43 3434 42 4134 6638 54 61 44 53 4318 51 37 4714 Cairo Div 1st gold 4s 1939 7618 7618 75 75 --------8111 85 8038 80218 ---------------- 86 86 86 86 --------86 86 86 86 Gin Wab & NI Div 1st 45 _1991 65 70 ----- 61 61 ----------------5912 60 6060 60 60 ___ -- ---6612 6612 6612 6612 St Louis Div 1st col tr 4sI990 65 65 68 -68 72 7412 --------71 71 65 69 --------68 68 7373 75 ---75 7512 7634 7412 76 Springf & Col Di, 1st 4s.1940 ---------------7112 7112 6478 71 --------80 80 --------76 76 White Wat Val Div 1st 4sI940 _ ____ ____ ____ _ ____ ____ ____ ____ ____ 5618 58 ____ — - ----- ---- ---.._Cleve Col Gin & In 65 1934 ____"94 9i --------100 10 -6 - -- ---- - 156i4 1001 1-60 99 1-60 10014 1-6014 102 102 --------100 Clev Lor & W con 1st g 5s 1933 97 97 ----------------90 94 --------96 96 --------94 94 96 96 --------95 0612 95 95 Clev & Pitts 4985 B 33.4s ser C 390,series D 1950 Gen 4995 series A 1977 Cleve Short Line lot 490.1961 Clev Un Term 1st 5 1 590 A 1972 1st 5 f 5s. ser B 1973 1st 5 f guar 4545 C 1977 Coal Rlv Ry 1st gu 49 1945 Colo & So ref & ext 490_1935 Gen mtge 43s sreles A-1980 Columbus & Tol 1st ext 4s_1955 Consol Ry non.conv deb 4s '54 Non-conv deb 4s J 8, J 1955 Cuba Nor Ry 1st 590 1942 Cuba RR 1st 50.Yr 5s g 1952 lot 1 & ref 7 99s, ser A 1936 1st 1 & 5 f 6s ser B 1936 _ 8T4 14- --------80 -g7-12 --------------------------------811 2 82 82 9512 10312 12 92 9712 i 4 14 737a 82 74 70 80 92 93 88 92 85 9118 75 8514 55 78 5378 70 6014 6734 6758 8478 78 81 8412 80 8112 7012 84 70 7814 55 7178 55 60 59 64 6352 76 73 8812 8812 ----------------85 85 82 82 ------------------------82 8414 91 88 93 7612 75 88 8018 84 93 60 75 78 78 85 65 62 70 42 47 65 70 35 46 51 6312 7078 56 65 41 4912 65 61 f -i 82 8018 8018 ' 8612 82 8612 6718 8134 73 8058 61 7818 70 73 6212 86 --------85 8512 78 8358 7822 6612 58 6314 5012 If 7712 7312 69 85 8124 55 55 /6 6412 74 6212 70 58 6312 72 4534 -------- -------- 80 16 Fi 16 ----------------------------------------8322 -----------------------------------------------45 45 ____ __ 45 45 43 35 50 50 56 56 714 -------- 4113 4112 ----------------40 46 4612 -4-612 --------44 44 40 1934 30 18 2012 2 2614 1734 2438 1612 177 1618 1718 1614 2278 20 3212 2712 31 2334 2914 2018 2612 14 2512 18 3012 45 2112 3378 31 44 23 35 3714 35 3712 25 345) 20 3278 39 34 3512 2878 3412 23 3533 38 35 25 3118 45 4114 34 3638 29 30 37 40 39 25 31 41 44 32 3218 30 3218 2678 36 38 --------35 38 24 35 2E 35 35 31 24 27 37 40 4012 42 ----------------28 -7-83 ; 61 83i2 --------8423 -az 44 40 2224 2734 29 28 Del & Bud 1st ref 49 1943 7684 8218 8114 85 s83 SO 7712 8312 8218 8714 80 87 7759 71 7218 8012 63 7834 62 87 7834 81 78 80 Convertible 5s 1935 8212 90 87 87 --------90 90 91 89 89 85 85 91 100 100 93 94 9314 9312 9234 96 95 96 15-year 590 1937 8078 93 8714 9214 8434 8812 7434 8012 7412 8228 82 9512 95 07 89 95 9212 95 93 9638 9112 94 Del RI,RR & Br 1st gy g4s1936 ------------------------------------------------------------ 92 02 --------9214 9214 83 9224 9214 9214 Deny & Rio G 1st cons 4s _1936 5 3012 45 4112 5878 4634 52 60 07. 67 59 66 40 60 3 4318 39 47 3378 41 3114 35 Consol gold 4995 1936 56 4412 58 38 46 3112 45 50 6218 6634 45 3312 44 70 56312 68 4712 66 41 4712 35 4113 3478 36 Den & 11 G West gen 55 Aug '55 2518 38 20 35 1212 1114 3312 19 2758 1238 2131 15 2012 978 1512 25 34 16 22 1212 6 7341 1614 7 55 series B 1978 36 17 37 1218 26 4934 3818 4412 28 4312 28 30 1838 812 18 10 2572 35 19 29 20 27 17 2114 Des Moines & Ft 0 1st gu 4s'35 Temp et( of deposit ------------------------------------------------ --213 i 1 - -212. 5 -2- _ __ _ _ _ _ _ 5i2 -234 Des l'lainos Vat 1st gu 43-4s1947 Det & Mackinac 1st 113 45_1995 -____ 24 ------------------------25 2512 5 -66 56 ii - - - - - - - - - - - - - - - - - - - - - - - - - - - 45_ __ ...-3 Gold 4s 1995 ____ __ _...- 25 25 ---- - - ---- - - ---- --. -_--- ---- --- 20 20 25 34 ____. -- 55 -H-i Detroit River Tun 1st 4 99s 1961 85 89 73 -3171 -74 71 -73 80 -84 75 -85 80 80 80 80 84 87 --------8522 -2 88 8512 Dul Nlissabe & Nor gen 55_1941 ____ ___ 9812 9812 98 98 ------------------------100 100 --------------------------------10222 85 3 102,2 Dul & Iron Range lot 5s1937 9658 -97 94 98 94 07 9634 9812 97 9812 96 0912 96 100 98 893 10014 9958 10022 100 101 10058 101 Shore & Atl a 5._ So Dul _1937 ____ ____ ____ ...--- 3212 3212 24 25 17 17 17 17 18 21 2034 31 2812 31 25 25 22 2214 1822 East Ry Minn No Div 1st 4s1948 ------------------------------------------------70 70 --------82 82 --------84 8414 16 84 85 East Tenn Va & Ga— Con 1st g 5s 1956 83 8412 80 83 65 6614 68 75 74 84 87 369 66 72 7012 83 80 85 84 85 85 85 82 8314 Elgin Joliet & East 1st g 5s 1941 8434 8612 8512 8522 90 95 9012 9012 80 80 80 83 82 86 86 90 88 93 89 021 4 8934 90 89 89 , Erie 1st con g prior 4s 1996 64 7314 70 74 23858 7512 57 6512 5334 60 50 6413 6353 68 6914 7714 7434 7714 7314 7638 73 7412 6312 7112 Registered r 6612 66'2 ------------------------572 2 5712 1st cons gen lien g 4s____1996 47 5712 5612 6212 4814 6314 37 50 29,2 44 32812 41 12 38 -45 4412 -59 igis -6634 -4414 -51-3;842 16 - -3758 151; Registered 4812 4812 54 55 57 58 ---------------__ --------39 _ 39 50 50-_-1961 9912 9912 9912 9912 9912 9912 9912 9912 9912 9912 999 Penn coil trust g 4s 58 --------99 99 -1: 99 119 T9 99 99 -99 99 "9"6-i2 ser con A g 48 1953 50-year 38 5112 45 4634 37 4812 33 39 25 35 20 2612 2214 -3424 30 5012 3712 4534 36 3914 32 34 3038 3324 50-yr con g 4s ser B 1953 37 4812 4112 4712 39 4918 30 37 22 30 22 25 23 33 2812 4912 41 4412 35 4114 3118 35 2818 33 Ref & impt 5s 1967 35 4934 3778 46 14 1514 31 2522 23 30 46 1334 23 14 2124 20 46 2412 3412 2259 32 29 90 20 2712 Ref & imp 5s of 1930 1975 35 49 38 46 31 4512 23 31 1459 2512 1314 2334 14 2124 1912 46 29 40 2412 3412 23 3134 20 28 Erie & Jersey 1st s f 6s I955 90 93 90 90 76 86 8812 78 86 75 7478 747s 67 76 7618 85 84 86 -- 8418 86's 84 87 Genesee Riv RR 1st s f 6s 1957 753i 7714 83 86 --------8312 91 80 85 75 77 76 76 77 85 82 84 --868912 85 89 -90 90 Fla Cent BE Pen cons gold 59'43 Flori..a East Coast 1st 490 1959 1st & ref 5s ser A 1974 Certificates of deposit Fonda Johnst & Cloy 490_1952 (Amended) 1st con 43.45.1982 30 4478 4 5 12 ____ 4212 4478 712 612 12 ____ 37 4418 5 5 10 ____ 37 --------30 35 32 3478 ----- 30 30 35 90 ____-__ 23 20 20 23 15 18 50 5214 60 4712 5618 47 5112 43 15 4318 55 53,2 5312 45 45 43 44 4338 4312 ._ 6 412 3 5 3 Cl c6 4 312 3 412 434 712 412 8 4 512 212 5 --„...2 32 6 5 5 312 5 234 278 212 314 5 6 4 7 -------- 222 3,2 112 312 8 11,4 912 17 828 8 8 6 5 6 -8-12 7 10 7 12 --------4 834 5 8, 712 8 ____ 9 012 --------524 524 512 6 8 712 5 7 7 6 4,2 412 234 4 53'i• Frem Elk & Mo V 1st 6s_ _ _ _1933 _ _ __ __ _ _ _ _ _ _ _ __ _ 90 ___ . __ ____ - 65 1-8 18 11 17-12 14 Gab v Hous & Hen lot 55_1933 Ga & Ala 1st cons 5s_ _Oct 1945 GS Corn & N 1st gu g s. 96 65 14 5612 16-12 . 96 -66 iiii 16 _ __ _ . 80 85 ---- ----- ---- - - 5212 -32-12 50 75 10 12-28 814 1038 812 -8-12 ____ _.- 1018 12 July 1,1954......................... 15 a Deferred delivery. c Cash sale 75 (Iiry -fiiis 71 7812 81 ii -7-761 67 55 56 68 7018 66 74 ---- --------------------434 10 91 Financial Chronicle Volume 136 1932.—Continued. BONDS Georgia Midland 1st 3s____1946 Gr R & 1 ex 1st gu g 4 Ms___1941 Grand Trunk Ity s f 7s____1940 15-year a 1 6s 1936 November December May October June August September July Apra March February January Low High Low High Low High Low High Low High Low High Low High tow High Low High Low High Low High Low High ----------------63 63 ____ ___ ____ -__ /90 890 9238 -9538 94 -9812 9712 99 97 8712 914 90'8 89714 95 ------------------------30 3312 85 90 ----------------741. 7414 9314 98 99 93 94 4 9334 100 94 9118 944 9012 9278 9214 9812 96 91 32 35 34 40 2934 40 3112 35 __ 7514 82 --------83 85 9958 10314 102 103 10258 10478 ____9758 1033-4 9712 10014 9958 10114 10012 10178 9312 10118 73 5312 6634 65 4512 68 47 Gt Nor gen Is CB &0 colt A '36 92 9834 8912 9512 8812 9612 6912 89 80 65 61 73 7412 1st & refund 410 ser A 1961 81 70 73 74 84 77 85 85 79 84 Gen a 510 ser B 63 7212 54 6212 3812 5912 4612 5712 56 78 83 75 82 1952 73 85 4358 56 52 Gen 5s series C 1973 714 78 7212 7812 7314 7714 60 6814 56 6014 44 66 49 5758 42 4834 40 50 4814 Gen 410 series D 6434 7378 53 58 1976 65 7314 65 69 60 3818 51 40 50 45 56 Gen 410 series E 7412 544 64 7314 66 694 64 1977 64 Green Bay & West Deb certificates B Greenbrier lty 1st gu 4s_1940 ----------------------------------------------90 3014 40 44 25 26 2612 20 20 Gulf Mob & Nor 1st 5)0_1950 43 56 4614 4712 678 50 2412 21 21 1st m 5s ser C 494 50 ---------------------- -20 35 1950 39 50 92 84 8178 74 69 69 78 8212 6958 65 59 59 8734 87 75 6938 64 6358 66 8284 5512 53 52 5012 56 -9-6 90 48 4712 4712 40 4518 39 52 38 343473424 8312 85 99 10178 954 9978 7812 867s 70 6712 8234 62 55 7318 4912 484 4258 4314 6912 81 5614 51 4812 51 16 41 30 27 31-3-4 2314 -35 34 18 35 5412 72 40 4118 39 40 6334 74 5112 4714 45 4512 89 9312 89 94 83 92 86 66 89 91 7212 72 7834 77 80 87 91 Hocking Val 1st con 410_1999 80 8612 8512 8534 --------81 88 88 ____ ____ 7612 7612 75 7612 83 83 88 88 --------79 79 88 88 Housatonic RR con 5s_ 1937 79 8012 --------88 88 ___ nous &Tex C 1st 5s int g-u_1937 ----------------28012 8314 83518 88 --------------------------------8512 90 ..„,- ___ ____ ____ __ 85 85 8412 844 85 85 -- -82 834 8334 --------85 -85 --------82 Houston Belt & Term 5s 87 87 3 89 1937 ----------------874 Houston E Sc W Tex 1st 5s_I933 9434 9434 --------------------------------90 90 ----------------95 95 --------95 -66 65T2 1613 --------94 4 ----------------93 1st gu g 5s redeemable.. r --------396 2 -82 8734 80 83 8334 88 W.47 83--K5 Hud & Manh 1st 8, ref 5s _ _1957 0 69 8078 60 7714 6012 7134 838 412 74 87 8058 8434 8012 89 54 5912 47 60 5712 4734 54 4514 8 47 3612 4612 315 5534 2712 27 4412 48145212 64 Adjustment Income 5s_ A957 53 60 5512 60 57 ------ ----------------78 78 7238 7314 72 76 Illinois Central-1st g4s 1951 80 138 8212 8512 ----------------77 77 7512 7512 80 80 _--- -1st gold 310 ---- ---_ ---- -_-- ---- -___ --__ __-- 6518 6518 --------72 75 1951 75 75 ----------------75 78 ___ ---- - - 6118 62 65 65 --------62 62 Extended 1st gold 3Ms_1951 ____ —__ ---_ _ _—_ 59 65 55 64 39 4912 5012 6412 58 65 55 62 30 4812 29 47 45 -52 Collateral trust g 4s 5012 -55 454 -54 I952 52 67 56 6214 5234 5712 51 5412 6112 66 49 68 35 4612 37 49 1st refunding 4s 1955 42 56 4212 5014 49 5434 45 4834 35 46 52 56 5412 5412 4912 4912 -------- 66 66 Purchased lines 310_1952 -----------------------------------------50 50 4712 5012 38 4812 36 544 49 5558 45 51 37-12 27 38 Coil Cr g 4s L N 0& T._ _ 1953 4514 5238 39 4734 40 48 35 43 25 26 43 5814 62 5278 5818 58 62 8512 68 58 68 55 55 42 524 37 46 Ref 5s 53 5858 5514 60 51 53 57 1955 46 6014 6914 63 6912 6214 6814 68 79 56 81 35 61 15-year secured 650_ _1936 5912 824 66 7912 6412 72 54 66 38 5118 42 53 4273 33 4014 30 503 4 38 2612 20 5312 30 2734 8 2195 37 19 3458 2712 40-year 410 3814 3512 4312 31 35 45 Augl 1966 35 52 Cairo Bridge gold 4s____1950 ----------------56 50 50 --------50 350 ------------------------------------- 63 63 56 53 51 ----------------6034 6034 6312 6312 53 55 Lou',div & term'l g 33.5s 1953 ----------------55 55 --------50 50 50 50 Omaha Div 1st g 3s _ 5i -Ei --------56 il Gold 3.4s ----------------------------------------------------7812 -5858 5858 2 5112 --------68 68 --------61 -61- 6314 6334 a IS Western Lines 1st g 4s_1954 ------------------------4818 5112 —.. III Cent & Chic St L & NO 29 24 3612 2314 30 Joint 1st 55 ser A 3878 4712 36 4114 2518 40 1963 40 54 43 50 29 32 3934 2712 3812 2212 31 23 29 1st ref 410 ser C 3834 46 1963 39 52 35 44 ..1950 4-5 --------------------------------50 Indianan & Louis 1st g is_1956 ----------------45 --- -- 42 41 -81 40 -66 59 56 5478 3612 501s 42 51 40 40 48 -75 81 3-6 40 56 . Gen & ref 5s series B......1965 ------------------------------------------------------91 91 --------90 22 28 1612 lot & Gt No 1st 6s A 4612 27 40 2612 17 24 5 5012 29 3-3 472 53 12 60 1952 1232 5 8 4 6 2 512 16 5 514 234 8 8 18 Adjust m 6s ser A 312 6 12 1612 20 30 1952 15 14 20 20 24 35 1st 5s ser B 38 15 26 1812 18 1312 25 1412 21 4718 2812 434 22 1956 32 50 41 194 20 2518 34 1712 37 1358 1st 5s ser C 15 20 26 1312 20 20 23 1956 3612 4812 4078 4438 30 4312 24 394 39 4212 3934 43 Intern Rys Con Amer 1st 5s '72 31 18 64 36 42 29 3412 2458 33 25 42 284 41 29 32 3712 41 31 43 43 3938 44 3658 44 1st col tr 6% notes 23 39 2714 3114 2314 30 37 4112 3018 35 1941 3812 5014 40 41 30 3012 35 1st Lien & ref 630 19 22 2918 35 2434 35 184 20 18 18 23 18 26 23 2258 26 1947 2114 26 --------------258 3 Iowa Central 1st g 5s . 24 3 -------512 _-- ---512 --,- ,--,, 1938 3 5 514 514 312 332 3i2 332 --------258 258 --------28 24 258 25 J3 4 014 --6'4 ---Certificates of deposit S ; 5 ,2 -- 3Refunding gold 48 1951 2914 47 43 75 90 2212 634 1938 1834 4312 4434 321s ------- 34 30 48 424 15 212 12 12 39 4318 Ms --,-..z -60 1412 1814 1812 4012 45 30 ---434 --------------------------------7634 James Frankl & Clear 1st 43'59 ----------------75 80 Kanawha & rilich 1st gu 45 _'90 -----------------------------3614 3614 57 K C Ft S & 51 Ry ref g 48_1936 5;34 70 34 6312 45 50 364 46 51 60 6 Ctfs of deposit (Bankers Tr) ____ _ -___ _ __ - _— ___ _ Kan City South 1st e 311_1950 6112 -7-0-- -5612 -6-5 - -5912 -6-5 Li -6-0-12 661-4 c-5-6 3634 5212 2878 Ref and impro• 5s_April 1950 36114 714 864 6812 6212 6812 48 5514 34 Kan City Term 1st 4s 78 8434 379 83 854 8012 85 1960 8318 8714 80 84 Kentucky Central e 4s_ _1987 ---------------- 68 68 ----------------54 -92 Kentucky & Ind Tern, 49s '61 Lake Erie & West 1st 5s '7 -fEl, i5T8 -g3-12 611 li &ii. -66 50 1937 6-5 -i 2nd gold 5s 72 72 85 70 76 57 --------60 66 4712 ----------------------------- -----, 40 4234 --- 4912 47 44 62 4934 55 41 _ 45,2 49 57 5934 54 5118 5814 57 684 61 6434 57 62 -5-5 4512 5012 42 4212 55 4612 703 58 70 39 134 48 8634 8912 87 8412 8012 8634 84 8978 8618 8078 874 90 7412 85 ----------------7814 56 56 54 6934 75 93 86 Iii a -76I4 76 -ff a 1612 a -.6 12 ---55 -4-612 49 61 50 9012 8712 ---- 7912 75 7634 72 7712 77 7514 79 79 7212 71 Lake Shore & 51 Sou g 3115 1997 7112 75 7314 7478 6814 7534 66 7334 71 7012 75 73 76 Registered69 72 711 75 .„ 72 72 ---------------------------74 Leh Val Harbor Term 1st 5s '54 5712 -66 --------902 T -66ir. ---------------- 83 -1; 3,, r ..r ,_--8-6 7212 7258 76 -76 76 60 6.3 i4 Leh V (NY) 1st gu e 4118_1940 --------70 70 711 83 6112 63 55 65 70 84 --------55 66 4138 4534 29 39 47 5414 43 51 Lehigh Val (Pa) gen con 4s 2003 4618 58 36 45 55 59 45 56 2712 3612 2914 3612 3658 60 33 45 4612 50 33 434 3512 4212 4012 6112 5118 5612 50 53 General consol 410 37 4318 35 40 55 5712 3838 45 2003 48 58 60 63 Gen con 5s_ 3558 4314 44 6734 5814 63 50 5414 48 5234 3312 42 39 42 42 51 43 43 6318 62 6414 6114 85 2003 61 Leh V Ter Ity 1st gu g 5s_ _1941 ____ ____ --__ _ ___ 90 90 87 88 80 84 -------------------------8834 90 80 80 84 8934 90 90 _ --Lehigh 84 NY 1st gu g 4s_1945 --- -- -,,-, ----_ ---- ____ -_-- --__ ---- ---- ---- -37- -71)— -r783 8334 8312 8312 75 75 --------84 84 Lexington & East 1st sits 5s 1965 --------7013 71.1- -7-0-- -'76- -70 7-9-12 --------------81 Long Dock con g 6s 95 100 __ _ ____ -__ __-_ 05 9914 93 9518 ---- - - 0612 9978 9934 9934 97,2 10 95 98 101 " 95 1, 924 -943-4 9212 95 8934 91 9318 95 Long Island Gen gold 4s _1938 8214 85 --------86 8812 ---- ---- 89 89 87 -4 88 -------- 88 88 Gen gold 43 ---98 1932 f512. 56 8634 83 8718 83 83 8514 1414 Unified gold 4s 4 7014 7014 Lo 16 --------71 -u3-4 iiis /114 75 -76 iL 1949 a 7-3 Deb gold ss 85 85 884 90 ------------------------98 100 ___ 80 90 02 92 ____ 9378 95 1934 00 9012 92 92 20-year deben 5s 90 928 93 9314 92 9278 8812 90t2 78 90 73 79 604 75 1937 78 80 65 -75 7612 80 7512 78 78 78 8058 874 83 8418 8112 84 Guar ref gold 4s 73,2 75 84 8714 8438 87 70 75 1949 75 70 376 74 82 7512 73 7612 7534 82 NSh Bch 1st con gu 58 Oct'32 99 994 99 9978 994 10114 9912 991 100 10018 100 100 100,8 1004 9978 9978 9978 9974 ---_ ____ __-_ ____ ____ ____ Louisiana & Ark 1st 5s A 1969 3858 43 2212 19 3614 154 30 41 50 37 4878 3618 40 Lou &Jeff Bdge Co gu g 4s 1945 73 73 55 75 75 ------------------------04 64 Louisv & Nash gold 5s 1937 -------- -------- 95 96 8814 95 95 90 90 8612 94 Unified gold 4s 1940 8 2 85 85 884 7514 84 06 8414 6618 7778 74 Registered 81 8232 1st & ref 541s ser A 2003 7334 80 713 -8-16312 E.; 14- Li 62 54 1st & ref 5s see II 2003 7134 7434 72 75 59 45 72 78 51 7212 155 6018 48 1st & ref 4 Ms ser C 2003 6514 71 55 4412 5412 40 55 4712 70 754 52 64 65 10-year see g 55 1941 Paducah &Mem Div 48 _1946 7012 7(112 i"-iTz -7-g12 8514 -8-0-14 73i2 -£361 - -_- - -- -- -a- -io"- - St Louis Div 2d gold 3s_ _1980 45 48 --------------------------------45 4858 5515 56 2 --- ----_ -458 5512 55 Mobile & Mootg 1st g 410'45 -------- 81 81 --- --_ " _ -__Southerally joint Mon 4s'52 ____ __ ____ _ . _ _ ---- --- - _ 20 -29-3-4 -268 Atl Knox & Cin Div 4s _1955 7438 -753-4 75 -if 79 -81- ------------------------70 gaT, ----761262 3014 5612 91 8078 2834 47 AO s60 8512 91 8138 89 32 4012 3212 3612 2912 --------72 76 7214 9514 9514 --------9612 8358 8778 8114 86 88 -665; 55 -6614 75 16 57 5738 76 c67 75 65 57 57 5634 73 6238 6734 57 -- _ 15 _ -31-34 70 68 4478 84 3078 70 68 _ _ _ 47- -5-650 84 -------5912 48 5312 77 80 78 SO 42 80 77 6718 68 60 ----------------75 25 c3612 25 41 38 7178 744 66 7114 79 79 6478 7712 53 75 6518 6612 61 68 54814 62 6712 6212 5912 50 37 50 59 3658 59 77 25 74 64 50 57 3912 72 72 72 1412 23 17 5514 69 5512 4018 54612 38 37 42 3118 414 50 36 13 26 212 72 22 69 47 3612 40 2212 _ _— 25- -3-6 67 7314 43 59 35 4812 38 55 20 28 85 29 74 59 49 62 294 85 43 80 7814 65 70 50 _ io 75 7232 5814 68 3812 -3-45-2 78 75 6312 7034 48 28 68 9634 8114 -fi LL 66 7012 5014 66 62 59 62 -24e 754 64 54 57 34 -667812 7312 634 58 42 -2458 744 57 52 5114 2812 98 56 324 70 9711 84 54i2 -66 5812 63 5378 60 _ __ - _ --- Lit; I25s _ --------45 47 4. 585 85 --------82 3612 45 45 41 45 74 78 --------75 Motioning Coal RR 1st 5s_ 1934 __-__ _--- ____ __-_ __-_ __-_ -___ -___ ____ ---- ______-- ---- ------- 95 95 --------9558 Manila 1(01. Sou Lines 1st 4s '39 60 -56 52 56 60 51 64 --------5012 634 5212 5378 ------50 /52 52 5314 5314 54 1st extended 4s 1959 52 52 52 52 --------52 52 51 ---- -_-- 5218 5218 5812 85 51 5214 52 52 52 Munk S W Colonic g 5s 1934 ____ „.... __-- __ -_ __-- ____ ---- ----_ --__ ---- ---- 80 80 ___- ---- ---- ---- ---- ---- 80 ?ilex Inter Ikt eon g 4s astd 1977 2 2 Mich Cent 1st gold 310 _.1952 77 Yi 78- VE 76i2 -7-613 ii -76 - .-7658 -fi , - -iii's -7-C8 -76- 16 85 85 --------81 .-ilia Y1-3, Ref & impt 410 series C_1979 --------------------------------45 52 70 52 57 60 60 ---------------- 67 67 Midland of NJ 1st ext 5s_ _1940 ___. -_-_ ____ --__ 42 42----------------40 48 5014 55 -___ 4812 55 Mil & Nor RR 1st 410(1880)'34 75 -75 ---- ---- ---- ---____ -- ---_-_ 87 ____ ___- ---- ---- ---- ---- ---- ---- ---Con ext 410(1884) 1934 __-- ---- ---- ---- 7112 -7112 50 50 -___ _ 7312 7412 ---- ___ 70 Mil Spar & NW 1st gu 4s 1947 -------------------------------- 51 -6-9-1; :::: -::: -4.6 454 -54 47 . 16- -ii- -6-21; 52 57 Minn & St L 1st cons 5s 1934 --------233 23s 212 212 -------212 312 ____ 334 612 ---- ---- ---5 __ 5 Temp etfs of deposit 6 6 5 5 -------- 4 4 378 378 378 _ ---- - -- - -314 4 5 5 1st & refund gold 4s__1949 112 212 112 184 2 2 1 1 1 1 -78 --------- 214 212 212 314 2'4 2,2 ---Ref Sr ezt 5s ser A Certificates ofdeposit5 5 81St P & S S 51 cons 4s stpd '38 38 150 3812 4778 43 474 if) -4-6-12 -ii - -55- -if - -al -4-E - 43 5078 i T2 563-4 ii -5-6 i5 1st consol 58 39 27 1938 32 3234 34 3112 27 3212 13 2212 15 37 3812 3812 25 5014 36 42 20 25 22 50 40 5114 42 45 1st cons 5s gu as to ins 1938 4312 5114 45 35 4412 39 4314 39 46 49 5534 50 4614 60 5014 58 1st & ref 6s ser A 2212 --------21 21 21 1946 21 2114 18 22 ___ ___ 15 37 _ ____ 14 2112 2634 1714 24 25 yeag 510 18 20 813 20 31 2 20 1944 20 20 1314 _ - --_15 23 26 $1518 23 12 26 1st ref 510 series B 60 6518 50 60 554 59 55 1978 45 46 50 40 -46- -45 50 5114 70 63 714 85 72 60 Mississippi Central 1st 5s_1949 76 Missouri-Illinois RR 1st 58 A '59 33 Mo Kan & Texas 1st 4s 1990 75 Mo-Kan-Tesas RR 5s A1942 62 Prior lien 4s ser B 1962 5212 Prior lien 410 ser D 1978 5512 Cum ad) 5s ser A._ 1967 394 &Deterred delivery. c cash sale. 38 7214 98 85 -,ff 8812 4334 75 _ 5534 1852 -85 -ff 70 ___ ---70 5414 ---34 8.6 69 47 ---- 1614 69 48 ---43 1514 ---- ---212 234 I 1 -4-7-12 39 5212 1912 1734 61 2 -4-618 25 3638 45 1212 1412 978 11312 4734 62 161-2 76 6318 5618 5818 36 WS -ii; i 73 753 2 5514 65 514 54 50 5414 28 3534 92 Financial Chronicle Jan. 7 1933 1932—Continued. BONDS January February March April May June July August September November December October Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High Low High Missouri Pacific RR 1st 5s A '65 48 6312 5212 60 2812 38 24 33 3715 55 2334 32 2212 27 2614 49 2912 4234 26 32 2212 3112 1734 229 General 45 1975 3014 4112 3234 39 20 3512 13 1414 8 218 7 1334 1014 15 1718 2812 1312 2134 934 1634 7 1338 34 1158 lot & ref 5s ser F 1977 46 60 504 5634 35 5.312 28 38 21 3312 22 3118 2212 27 265 4512 2812 40 2412 313 4 21 2934 1712 2234 lot & ref 55 ser G 1978 4.534 60 5018 5634 3512 534 284 3714 22 33 234 3054 2212 2634 2634 45 28 40 2412 31 2112 3012 174 22 Convertible gold 53s 19 1949 30 464 357 44 4014 12 2112 2614 121 2 612 1112 25 1278 11 34 1612 273.1 1212 21 1018 1512 7 1134 1st ref gold 55 series 11_1980 46 CO 5114 5612 36 5334 28 377 22 3312 22 3112 23 2678 27 45 29 40 25 3114 2112 2934 1712 2212 1st & ref 5s series "I" 1981 46 60 5014 57 364 54 28 38 214 34 2112 3114 2234 27 27 4512 28 40 24 3112 2112 30 1712 2234 3d 28. ext at 4% Mobile & Ohio — Ref & Impt 43.s 1977 104 2312 14 2138 13 1814 10 614 12 93 14 215 6 112 358 33 .5 9 6 612 4 6 234 4 Sec 5% notes 1938 15 . 28 1712 2712 1812 23 37 1018 6 13 18 912 13 212 7 2 5 418 512 354 5 934 514 8 Mob & Mal 1st gu g 45 1991 7534 7534 72 72 Montana Cent 1st gu 641_1937 -------- ---------------- 93 93 Sg5 -6.3.14 ------ 88 01 58 -i5- ____ _ ____ ____ __ 1st guar gold 55 193700 90 ----------------385 385 82 82 --------82 82 83 87 87 888 87 -8-7- _ _ _ _ _ _ _ s82i4 817-34 Morris & Essex 1st ref 33i5_2000 69 7318 71 7214 714 7338 718 7212 6612 73 67 7014 62 6912 6912 73 74 76 7312 -7512 69 732 7434 77 --------------------------------------------------------81 Coastr m 43is ser "i" i _1955 29 --771 70 79 _____._.I468__-----8 3 744 80 8 74's -711Nash Chatt & St L 4s 1978 -------- -------- 7012 7012 --------46 50 4712 52 --------6112 65 70 72 --------6623 6614 6512 68 Nashv Fla & Shef 1st gu 55 1937 -------- -------------------------------- 68 68 53 60 81 81 83 83 70 70 National Rys of Mexico 43.4s asetcash warr No.3 1957 2 2 ____ ____ ____ ____ 14 118 --------------------------------2 134 212 134 134 1 2 114 4s asst warr rots No.51977 159 1% ------------------------2 2 2 --------2 2 2 158 312 ---- - ------1 2 4 Asass't cash warr No.4 1926 212 212 1 2 134 2 118 --------------------------------2 2 1 2% 112 2 23 4 114 214 4s ass't cash warr No.4__1951 1 1 ------------------------11 118 ------------------------128 212 --------122 134 78 114 -65l2 71l2 New England RR cons 85_1945 ____ ____ _ ___ ____ ____ ____ __- _ ____ ____ ____ ____ ____ __ _ - --- -_-- -___ ____ --_ 28 -71 75 75 __-Cons guar 4s 1948 _ N 0 & Northeast 4 3is A 1952 56% 5675 ----- 95 -41 ig "3-6 ----------------31 -g12 ____ __ ____ __ ___- --- 56 16 New Onl Term 1st 4s see A_I953 60 65 65 -65 65 66 6018 " 6-6 61 6112 ---- ----50 5112 51 64 66 -7-0 64 -6-8 55 -67 60 6112 New Onl Tex &Ides 5s see A 1935 35 3975 384 3812 30 3812 ____ 20 21 30 45 --------25 34 217 24 20 204 1st 55 ser B 1954 2812 41 3312 17 30 30 -36.18 17 18 25 84 1818 25 2412 45 1612 12118 4112 25 3612 2012 25 1512 2212 1st 5s ser C 1956 33 39% 36 36 3112 36 304 3012 18 25 22 2112 45 3412 4412 26 3212 2312 24 1934 2012 21 15 22 1st 4 34s ser D 1956 30 443 29 32 2412 1859 2015 16 3014 3512 24 1612 22 22 4014 2934 3912 23 35 --------15 19 26 1st 534s ser A 1954 3012 45 3618 418 31 3912 2478 32 19 2514 19 2312 27 20 2512 25 5014 37 4334 2512 38 25 1734 234 Npt & Gin Bdge gen gu 430'45 80 80 8212 8212 ____ ____ ____ ____ ____ ____ __ _ _ ____ ____ 8912 8912 ____ __ __--- -- -- ____ ___ NY Bklyn & SIB con 5s__ _1935 9412 9412 --------------------------------89 -80 -9218 --------05 92 -95 --------99 100 924 _95 NY Central RR cv deb 65_1935 83 92 8534 912 4 0112 72 8712 354 7078 3612 58 47 6478 61 8314 69 79 5312 70 5555 6334 45 5714 Consol 48 series A 1998 6212 754 71 75 675* 805* 65 72 584 7214 56 6i2 5859 65 6412 8075 7234 7634 6714 73'8 6012 66 5614 61 Ref & Inapt 4348 ser A 2013 6512 7114 6434 6912 58 72 5812 52 50 52 3212 4412 3412 41 42,2 6312 52 6014 4312 5314 43 4834 31 45% When Issued 6512 72 6412 6912 58 72 4112 64 50 5812 32 50 43 5434 42 4834 33 4512 52 61 34 42 44 31 Ref & Impt 5s ser C 2013 694 7812 71 75 58 7834 53% 6534 37 52 334 51 3612 4512 4312 7034 56 674 47 61 45,4 5324 35 4914 NY Cent & Hudson 330-1997 7055 734 27034 735 724 75 68 75 368 754 36712 75 6958 7212 7358 7834 7412 79 7312 78,4 7034 75 72 76 Registered 1997 ----------------6723 6812 70 70 ----------------68 68 73 73 --------6922 6912 72 72 72 72 Debenture gold 48 1934 845* 9214 244 92 8778 9212 76 88 55 75 57 72 6958 86 7834 8478 7012 7878 66 71 75 64 6959 30-year deben 48_1912-1942 78 81 81 82 65 8212 7512 76 6418 6418 66 66 75 75 8012 8212 80 8114 --------64 73% 63 65 Lake Shore coil e 334s..1998 6512 70 67 6212 6634 62 66 725* 66 69 67 7312 70 76 6338 71 6812 72 3685 7012 66 6812 60 65 Registered 1998 Mich Cent coil g 3148.._1998 --------67 ------------------------6814i 1 (14 65 65 64 64 iii -6-4- 69 -61 64r2 -7-1- a -il- 68E8 -ii 6812 70 N Y Chic & St L 1st g 48..1937 77 82 71 7459 77 6318 65 765* 73 82 80 71 75 80 7859 80 71 6378 6612 65 73 75'8 6612 80 6% gold notes 1932 2259 57 45 55 5334 7478 2812 54 2212 35 3912 6312 27 627 33 50 32 40 25 45 24 35 Certificates of deposit_ _ - _ - - 32 42 30 38 -- -_ _ -- - - --- 833 36 - ---32 c43 Ref g 534s ser A i7129 iii2 11-12 5ii"8 "4-612 55 " 2i -46 2259 3814 19 2512 1714 2412 1234 1834 4-6-13 55 -3 1 1iiT4 -2-3- i91-2 -2-2- 16 -2-5 Ref 434s ser C 1978 19 36 3114 3534 30 40 19 28 1212 2012 13 1914 3912 20 3322 1618 23 1418 24 20 1515 20 1012 1734 3-year 6% (3 notes 8aa -Bi NY Connect RR 1st 4345 A 1953 81 1st gu 55 ser 13 1953 91 85 91 7978 85 88 88 ____ ____ 9018 93 --------75 7512 7638 77 --------6734 68 6734 68 76 77 774 79 7718 58 87 89 8312 8555 87 8418 8712 8759 00 85 9018 9018 9114 9114 9114 9124 - 2000 25 -& Harlem g 3is 7i 28 -ii ii -ii ._ 711 711 80TNY 8112 681NY Lack & W 1st & ref 5s A '73 1973 --------75 75 ----------------75 82 1st & ref 4.34s 89r B 84 90 _ 81 ___ ____ 78 ___ 78 78 78 56 N Y N El &H non-conv 4s 1947 56 63 63 63 69 63 63 ---------------- --------60- -64 62 -6-2- 62 62 60 Non-convertible 3%5_1947 ____ __ 53 53 60 c67 51 52 -------- -------- ------------------------50 50 Non-conv deb 33-4. 1954 55 -1 55 56% 56 58 61 46 5012 3514 4514 3 4 50 ------------------------50 42 1955 60 65 --------61 Non-cony deb 4s 6634 4812 5534 50 55 53 66 43 53 40 45 604 6614 612 65 60 1956 58 644 63 6312 554 68 Non-cony deb 4s 62 62 40 52 5014 52,2 54 43 48 4018 42 60 66,4 61 68 Convertible deb 394s.......1956 51% 55 ____ . 58 58 48% 53 --------43 43 51 50 587 5878 51 3712 50 50 57 Convertible deb 68 1948 88 95 8712 --9212 86 95 75 87 49%381 62 7575 7412 9178 82 894 73 82 52 70 7222 Registered 92 92 --------75 76 6104 6188 --------75 75 -77 2,'• .. M .. ,: Collateral trust 65 1940 8318 90 87 91 914 94 74 93 55 8112 55 6734 66 75 75 -8-1-34 70,4 7414 90 81 -89 Debenture 45 1957 48 574 524 5714 56 59 7 7 50 52 37 45 43 42 58 37 30 31 49 53 31 47 5312 1st & ref 4 345 ser of 1927_1967 68 77 6612 7134 66 75 5912 66 6112 48 6212 60 754 67 7424 62 69 42 603 4334 55 Mar Riv & Pt Ches 1st 48 1954 ----------------81 83 68 68 82 82 8018 83 78 83 8312 73 75 70 70 74 74 NY Oat & West 1st g 48-1992 3834 51 1955 40 46 General 4s 454 5014 49 4134 44 41 55 44 4259 53 35 41 45 36 52 40 88 00 60 58 -50 6112 61 50 7884 61 40 53 50 7014 .' If 74E8 48 36 6524 56 85 8414 88 -6112 -5157 5918 54 7834 13-67i 44 6514 86 3934 49 447 50 34 45,8 3534 38 4659 60 524 5558 4912 548 48 5212 49 51 3734 4912 45 4812 42 4712 42 4514 38 44 -85 85 N Y & Put 1st con gu g 45_ _1998 22,1 -7-7-18 -------------------------------- 70 -7-4- --------70 -776 io "7-6 --------72 72l4 _ ... 35 45 354 40 36 4012 30 33% 20 24 54 N Y Susel & West 1st ref g 5s '37 41 3112 36 3212 36 27 43,4 36 43 18 25 2754 1222 1937, __ 241 g4940 ---- ---- ---- ---- ---- ---- ---- --__ ____ __-- ---- ---- ---- ---- ---- ---General gold 5s 1940 5018 -3-9-3-4 25 2534 204 25 - 35 38 31 31 15 2012 2559 39 30 3124 --------18 18 15 - -- -2-i Terminal 1st gold 5s 1943 92 92 _, _ _ _ _ 9212 -9-2-12 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ NY Westch & Ros 1st 434s I '46 52 62 5834 88 -62 ii -Ei 55 "41 -ii- 16- -5i -41 98 -6-1- 98T2 -5-i756 8 98T8 IC 9212 51(2 5ii8 17Nord Ry esti s f g 694s 1950 9634 10014 97 103 100 10212 10015 10318 31023,10512 103 105 10412 10659 105,4 106 10434 10534 104,8 106 1043 10459 10234 10534 Norf & Sou 18t & ref 511A-1961 1112 2012 14 19% 1459 1812 7 14 5 814 412 5 5 5 1312 5 11 4 5 67 314 414 218 314 1st gold 55 1941 --------50 50 28 30 2118 26 40 40 40 40 31 15 33 15 1214 3212 1318 1512 14 24 10 1512 Norf & West RR Imp— Ext g 6s 1934 10112 102 101 102 10212 10234 10212 10234 10214 10314 100 103 10212 10314 1025910312 10322 10412 --------1032310359 10359104 1932 --------0984 9934 10014 10014 -- New River 1st g 65 - ------ - ,2' -,.. . =- ,r. , ....'. .' , --Norf & West Ry 1st eons 4s 1996 38212 89 87 9212 85 -9-612 78i4 COI 259'4 i78 - -12 -':"' 8178 -8-9 8912 -9-618 9212 -9-612 VP:4 0 93 -9-518 54 1-00 Registered 1996 81 81 8018 8018 ----------------86 86 ____ _ ...,- _-_,- -,,, „,-- -,7,,,,,;-- -,,,;,..- - -,,,,, -... - 93,2 9418 Div 1st lien & gen g 4s 1944 87 9112 8712 92 8812 9238 89 9218 388 934 8634 -9-2-58 91 -63 0118 -°384 "`'4 ; -9 28" -9-° "2 -50-'8 06 9924 Poca C & C joint 4s 1941 8514 92 9212 907 92 89 9212 91 9259 923 9318 9318 9359 94 96 87 917 89 84 91 379 82 88 85 Nor. Cent. gen & ref 5c Gen & ref 434,A Northern Ohio 1st gu g5s_1945 --------------------------------------------------------35 50 --------40 ig ia it 55 -66 Nor Pac prior lien e43-1997 774 82 7534 82 7618 8214 6912 8012 4 7934 2 718 514 8234 81,2 86 8312 86 8178 854 81 82% 80 85 Registered 1997 743 7434 734 75 754 754 5584 7534 50 64 71 -------- 76 80 ---- ----62 6212 --------79 7959 71 Gen lien (33s Jan 2047 5114 614 57 61 594 48 51 55 63 613 61 6312 59 612 534 59 5738 4812 574 64 6014 5834 65 Registered Jan 2047 ____ _ 544 5412 60 50 --------52 52 56 56 ----------------54 54 --------4814 50 Ref &'mot 43.4s A 2047 6518 --5712 6934 38 6 6812 6712 694 694 -76 4518 5812 4958 7614 6712 77 61 40 50 68 6418 65 54 62 Ref & Imp 65 ser B 2047 78 898 85 894 8012 9012 66 8012 45 69% 464 62 79 88 764 8214 6812 79 5334 6914 6914 95 64 708g 2047 75 Ref & imp 5s ser C 777 74 65 7714 7214 82 6415 73 63 68 48 55 775* 73 78 --------54 54 52 53 60 63 Ref & imp 55 ser 0 2047 70 73 78 70 70 7634 73 376 62 38112 72 82 65 7234 63 67 49 55 4812 85718 51 .58 5715 60 904 og & L Ch 1st gu g 4s 1948 1936 Ohio RI. RR 19f g58 Gen gold 58 1937 1946 Ore RR & Na. con g 45_ Ore short L 1st cons g 58_1946 1946 1st con 5s guar Oregon-Wash 1st & ref 45_1961 Pacific Coast Co 1st g 55_1946 pac RR of Mo 1st ext g 4s1938 1938 2d extended gold 5s Paducah & 111 19f s f 4 365_1955 Paris-Lyons-Med RR ext 6s1958 1958 Esti 5 f 78 45 45 --------40 4975 40 4812 --------35 36 4712 4912 40 4938 45 54 37 50 28 33 90 90 -----------------------82 --------80 8 6 7 6 15 -7-8-38 70_ r r - 8-38 - - - . - - 58 -gi 58 -gi 8912 -8512 80 85 8 38 9114 90,4 9159 88,8 88 90 8112 83 77 814 79 ( 95 99 96 9712 10012 98%102 100 1027 92 98 9634 9459 96 88 94 90 937 88 9234 90 92 9434 100 95 10012 98 102 10012 102% 100 102 9612 997 97 9912 05 9714 92 925g 8812 94 95 97 72 78 72 7712 7534 83 7918 8334 798 8378 804 8278 7238 84 74 68 71 78 7214 6012 73 61 ___ __ ____ ___ 194 1918 18 26 30 2712 2734 29 29 1734 1814 1912 30 1814 --__ 18 _ 18 87 -90 8512 -87 8112 8112 80 --90 90 85 89 75 7712 78 85 85 c913 38314 87 8012 72 79 86 85 85 35812 93 -------------------- ------------80 85 91 82 82 .38338 8518 85 85 95 9518 --------93 93 -------------------- ------------------ -87 00 91 9534 94 99 10024 1144 81 10314 s 334 1378 98 10114 1005*10214 102 c10412 102%104 10158 10412 103 10414 10312 103% 103 103% 1031g 10434 ---- ---- ------- Paris-Orleans RR ext s f 5345'68 8812 9478 55 Paulista Ry 1st & ref 75_1942 41 Pa 0& Dot lot & ref 430A 1977 70 787 1943 90 92 Penn RR con (348 1948 8712 93,4 Con gold 45 Sterling stamped dol bds__ 9012 9012 1960 9014 94 Consol 4948 1965 7912 8
@FedFRASER