Evening Star Newspaper, October 30, 1929, Page 4

e d BUSINESS UNHURT, DR KLEIN DECLARES Market Crash Not Expected| to Affect Firm Structure of U. S. Industry. By the Assoclated Press. Official Washington clung steadfastly today to its opinion that American business need expect na adverse result from the collapse of stock exchange prices Such a view was expressed by Dr. Julius Klein, Assistant Secretary of Commerce, in a widely broadcast ad- dress last night, over the National Brondcasting System, which is under- stood to represent the attitude of the administration in general, and coin- cides with President Hoover's previous statement on the business situation. No action had been taken by the Federal Reserve Board, in the face of yesterday's precipitous decline in securi- ty prices, although the board met with Secretary Mellon attending, and was known to have been in close touch with the Reserve Bank at New York. Tydings Raps G. O. P. The break in stock prices was at- tributed to the party In power by Sena- tor Tydings, Democrat, Maryland, in a statement issued through Democratic national headquarters. It asserted that “in most cases there is the ironical realization that these great leaders, who 8 year ago were yelling ‘prosperity’ are trying to find a scapegoat in the face of a $15,000,000,000 loss in one week of American life.” Dr. Klein cited numerous circum- stances to support his view that Ameri- can business is standing squarely upon & firm, sound basis. The purchasing power of the Na- tion is at a high level, he sald, and may be expected to continue s0; the demand for commodities has not been affected by the swckmmu::el cnllflp;f: employment is on e incremse, F<T rnpetuy production booming; stocks of manufactured goods have not piled up and average commodity prices have maintained consistent levels, “Regardless of regrettable speculative uncertainties,” he asserted, “the indus- trial and commercial structure of the Nation is sound.” Hoover Statement Stands. Pointing to President Hoover's state- ment of last Friday on the business sit- uation which expressed high confidence in the industrial structure of the coun- try, Dr. Klein said that no interven- ing circumstance could be regarded as necessitating a change in a single word that the Chief Executive uttered. At the most liberal estimate, he as- serted, only a very small proportion ot the American population has been af- fected by the stock market collapse-— less than 4 per cent of the famllles and Jess than 1 per cent of the popula- tion by individuals—with a “vastly pre- ponderant majority of the Nation un- affected” by “speculative gyrations.” From this circumstance, he drew the conclusion that American purchasing power and o Jgequent demand for com- modlftla. > e scnx"cely touched by the fall urity prices. G et 2nid. that it was impossible for kim to forecast what might be ex- pected on the Stock Exchange “tomor- row and next week,” and improper, as well, for a Government official to at- tempt to do so. Psychology Plays Part. “The careful student of American economic life,” he continued, “equipped with an abundance of statistics, can forecast fairly well the long time trend of production and of standards of liv- ing, and even of many more specific branches of business or other eco- nomic aspects. He cannot foresee ac- curately short-time changes in eco- nomic conditions-and least of all those speculative changes which depend largely on the psychology of the people or of a fraction of the people. “All of us are justified, in my opin- fon, in a profpund confidence in the general econol future of the country. Just what relation should exist be- tween that confidence and his present attitude toward ‘the stock market is something for each individual to decide for himself.” B YIELDS GAIN HEAVILY AS MARKET CRASHES By the Associated Pregs. . NEW YORK, October 30.—The Te- cent decline in stock market E‘flqs has increased the yield. of leading issues from levels which, 'in'some cases, ranged around 1 per cent to & high as 11.11 per cent. $ Arthur W. Loasby, president of the Equitable Trust Co, has said that as a result of the deflation, investors will begin purchasing ylelds instead of quo- tations. At yesterday’s close, some of the yields were as follows: Anaconda Copper, 8.24 per cent; Bethlehem Steel, 7.14; Bi more & Ohio, 6.11; Delaware & Hudson, 6.22; General Motors, 8.24; Goodyear ‘Tire, 7.46: Hudson Motors, 11.11; Ken- necott, 7.60; Continental Can, 5.66: I1 linois Central, 5.70; Montgomery Ward, 558; New York, New Haven & Hart- ford, 5.56; Republic Steel, 5.50; Texas Corporation, 5.94. Copyright, 1929 T&B Mfg. Co. Are You Radiator Conscious? Tuttle & Bailey Furniture for Radiators satisfies the ar- tistic sense, keeps walls and curtains clean; humidifies “desert-dry” Winter air. Of- fered a wide variety of styles and prices. Guaranteed against loss of heat. Send coupon for hooklet or phone Potomac 2436. in MR. G 1706 Conneell Washington, Dear Sir: Please send me booklet ;New Astistry in Radistor Conceal- ent. | THE EVENING STAR, WASHINGTON, JULIUS ROSENWALD PLEDGES ‘Supplies Necessary Margin to Save Accounts of Sears- Roebuck Workers. Policy of Support Is Same as Followed in 1921 Period of Depression. By the Associated Press. and Examiner said today in a copy- righted story that Julius Rosenwald, philanthropist and chairman of the board of Sears, Roebuck & Co., had “pledged without limit” his personal fortune to guarantee the stock market company. Mr. Rosenwsld decided to take this action, the paper said, following the market drop last Thursday. That same evening he conferred with his son, Les- sing, who is vice president of the com- pany; Gen. Robert E. Wood, president; W. O. Lewis, treasurer, and John Hig- gins, another vice president. To Hig- gins' was delegated the duty of seeing that the employes’ accounts were pro- tected. Looks Up Accounts. Higgins immediately looked up the accounts of all employes, not only in Chicago, but everywhere the company has branches. When he found an em- ploye carrying an account on which, in the present bear market, his margin had grown too narrow for safety. Hig- gins communicated with the broker handling the account. . The broker then was asked whether additional collateral was needed to safe- guard the account, the Herald and Ex- aminer sald, “We simply put up the collateral so that our employes be able to weather the storm,” Higgins explained. “One of the first things I found out was that a great many employes will have no need for the assistance offered. Some of them, thanks to their thrift and good judgment, are wealthy. The help Mr, Rosenwald is offering is for those who need it.” Did Same Thing in 1921. Through Higgins it was learned for the fll’slB time that Mr. Rosenwald adopted a similar plan during the period of financial depression in 1921. “At that time what we did in Mr. Rosenwald’s name was to gather up all the employe stock acounts that needed support and place them in the hands of two big brokerage concerns, deposit- ing collateral as required. The sum Mr. Rosenwald then pledged was about $1,- 600,000.” Also in 1921, it was recalled, Mr. Rosenwald made & im of $5,000,000 worth of his own stock to the company and pledged $20,000,000 more of his personal fortune to see the company through. "The present action, it was explained, applies to all employes’ stock accounts, no matter what stocks the employes hold. INVESTOR DROPS DEAD. Prominent Rhode Island Man Stricken in Broker's Office. PROVIDENCE, R. I, October 30 (P). —David Korn, 57 years old, prominent in Jewish charitable activities here, dropped dead in a broker’s office yeste! day, as he was watching the stock tick- er. Witnesses said he had appeared worrled over the stock market crash, but the brokers said his holdings were in no especial danger. “LOOSE ENDS NIGHT" CHICAGO, October 30.—The Herald accounts of the 40,000 employes of his | BACKING FOR EMPLOYES' STOCK | INHEAVYBOYING « | | Market Displays Steady Up- JULIUS ROSENWALD. © 200 MEMBERS ADDED. Rhode Island Avenue Citizens to Have Election. Election of approximately 200 new members who have been obtained dur- ing the annual membership drive, con- STOCK LIST GAINS ward Tendency Follow- ing Record Break. (Continued From First Page.) dication wes given at that time as to | whether a statement would be forth- coming, but the bankers were repre- sented as believing that the condition of the market had vastly improved. ‘The second faflure of a curb house did not check the upward trend of prices and by 11:30 am. a wide assortment of leading shares on this market showed wide gains. Electric Investors was up $23 a share to $109, Electric Bond & Share, $12.50 to $72; Citles Service, $5.25 to $27.50; Blue Ridge, $3 to $10.62; Central States Electric, $2.25 to $22; American Super- power, $4 to $22; Lehman Corporation, $8 to $90; Middle West Utilitles (new), $5.87 to $23.37; Niagara Hudson Power, :f‘ tza_ $15, and Shenandoah, $3.25 to .25, While trading on the curb falled to approach ieskrdly's terrific pace, many blocks of 5,000 to 30,000 shares changed hands, and the ticker fell about half an hour behind trading. Second Broker Casualty. ‘The second casualty among brokerage SASSASARRRAA AR AR A AN A0S SRR AR AR RSN ducted since feature tonight's program of the Rhode Island Avenue Citizens' Associatioh in the Sherwood Presbyterian Sunday school hall. Prizes will be given the individuals who have signed the most new mem- | bers. Dr. George C. Havenner, president of the Federation of Citizens’ Association, is expected to attend. New York Times today calculated of 240 representative stocks dur- It pointed out also since there are depreciation for the month houses took place today when the firm of Lynch & Co. was suspended from the New York Curb Exchange for fail- ure to meet its obligations. The curb firm of John J. Bell & Co. was sus- pended yesterday. Neither firm was engaged in a general commission | business. Due largely to the unprecedented volume of stock trading yesterday the New York Clearing House today re- ported record-breaking clearings of $3,- 500,000,000, which contrasts with the previous record of $3,034,000,000 on January 2, 1920, Informal conferences of leading bank- ers were resumed today in the offices of J. P. Morgan & Co. Charles E. Mitchell, president of the National City Bank, and Owen D. Young, chairman of the General Electric Co., were among the first to arrive. ‘The boerd of governors of the New York Stock Exchange will meet at 3:30 pm., when the quetsion of closing the exchange either on Saturday or Mon- Century Heat CENTURY 0L BUrNER 5, 470% & GR. District 7408 the last meeting, will Decline in Stocks Is Put Between 30 and 50 Billions By the Associated Press. NEW YORK, October 30.—The the decline in the market value ing October at $15,894.818,894. 1,279 issues listed on the New York Stock Exchange the total between two and three times this amount. Myr. “Paint-Up” Says— “Don’t Neglect Your Walls” With Fall housecleaning time at hand, make it a point, this year, to paint your walls. Color is all the rage, and we have the wid- est assortment of pleasing colors and tints, Flat-tone finish for most of the house, and gloss finish for kitchen and bathroom walls. FEco- nomical, sanitary and lasting beauty. See us NOW for estimates. BUTLER-FLYNN Paint Company 607-609 C St. Phone Metropolitan 0151 GINGER ALE You Can’t Be Disappointed in National Ginger Ale, no matter when or where you buy it. It was the perfect Ginger Ale when it was first offered to the public—and is Made today the same way that made it famous. By case or bottle at grocers and delicates- sens. Served at cafes, clubs and fountains. Guggenheim Co., 33d & K Sts.,, W. 2508 Reliable Dry Cleaning & Dyeing Why Pay Fancy Prices— We Give You Quality NO 2 of us want to spend money foolishly. If you compare our rices with those of any other reliable firm you will find our prices are low. Compare our work with any other satisfactory cleaning and dyeing and you will see our work ranks high. This is an open statement. We can't stay in business two minutes if we don’t live up to it. Silk Dresses Cleancd and Hand Pressed with the closest attention to detail. cleaned Men’s Suits, cleaned and pressed and pressed Men’s Overcoats............ Women's Long Coats (“ga™ . Wool Dresses (g, Women’s Wool Suits......... We Call for and Deliver DISTRICT CLEANERS & DYERS, Inc. 630 G Street N. Metropolitan 1627 Conn. Ave. 811 Vermont Ave. 2406-2407 505 C Street N.E. 123 B Street S.E. D. ¢, WEDNESDAY, OCTOBER 30, day to give brokers an opportunity to bring their records up to date will again be thrashed out. Sentiment for closing the exchange is widely divided. Delivery time on securities bought and | sold in yesterday's record-breaking mar- | ket was extended from 3:15 to 4 pm.! today. | A sweeping rally in prices took place at_the opening of the market. | United States Steel common, directors of which declared an extra dividend of $1 after the close of the market yeste:- day. opened $3 a share higher at $177. North American Co. showed an early gain of $10, Canadian Pacific $8.35, American Telephone $7, Westinghouse Electric $4 and New Haven, Erie, Penn- | sylvania, Chrysler, Montgomery Ward and Paramount-Famous Lasky moved | up $1 to $2 a share, | Several blocks of 10,000 to 30,000 | shares figurcd in the initial dealings, with early gain, ranging from $1 to $10 | a share. A few stocks opened moder- | ately lower as a result of further forced liquidation following yesterday's dis- astrous break, but these losses failed to check the buying in the general list. It was apparent that strong buying support had developed overnight, and that a more cheerful feeling existed in both investment and speculative quar- ters. Hysteria Subsides. While the early buying was much more conservative in character than the selling which took place at yesterday’s opening, bankers and brokers alike wel- comed the apparent subsidence of the wave of hysteria which had swept over securily holders during the past week. Nearly all the leading brokerage houses, a.d several of the investment services, vised their customers over- night that high-grade stocks were at bargain levels and could safely be bought for investment. Whereas a few weeks ago many stocks were selling on a yleld basis of less than 3 per cent, the | recent decline has brought prices down tv where ylelds of 5 to 6 per cent were quite common, with some of the more unseasoned issues ylelding 10 per cent or more at current levels. A note of optimism was heard today amid the echoes of a Wall Street crash 1929. minute rally yesterday that lifted from the depthsito which they ha iwept by: the torrent of selling. e note was repeated in the s ments of ‘John J. Raskob and other financial leaders, who declared that the fundamental soundness of business and the present price of stocks offered an attractive opportunity for the investor. Bul before a series of huge buying orders, flung into the market during the last 15 minutes of trading, had dammed th. flow, the third and biggest selling wave had hit the market within a week. The volume of trade broke the record of 12,894,600 shares set last Thursday and eclipsed Monday's volume by 9,- 212,800 shares. On the Curb Exchange a new record of 7,096,300 shares was established. Although the volume on the Stock Ex- change exceeded anything in the an- nals of its 100 years or more, trading was orderly and the ticker was only an hour and 52 minutes late. Last Thurs- day it ran 4 hours and 30 minutes afier the 3 p.m, closing gong. The group of bankers who had been co-operating in efforts to stabilize the market announced, through their spokes- man, Thomas W. Lamont of J. P. Mor- gan & Co., that they would continue their efforts. Bankers’ Statement. After a meeting last night, Mr. La- mont said: “I want to take pccasion to explain again, as heretofore, that the banking group was organized to offer certain support in the market and to ect as far as possible as somewhat of a stabilizing ces | been } chairman and member of the finance committee of General Motors, said con- cerning the market situation: “Many of us have long felt great con- cern because of the inflated condition of the stock market during the past sev- eral months. Huge amounts of money have been loane: market at most attractive rates by peo- ple who ordinarily would have this| money invested in securities. | “The present decline has carried prices in many instances to levels ridic- in the call money|. BROKERS ASK RECEIVER. | SEATTLE, October 30 (#).—Frazier, Goodwin & Colver, investment brokers of Seattle, yesterday asked that a re- ceiver be appointed to take chagge of the affairs of the company in a sult: filed in_Superior Court The complaint, filed by H. A. Célver, recited that the firm, which specialized in Fulton Petroleum, has been trading on & margin basis in New York stocks. | Standard Statistics Co., publishers of ulously low with the result that nearly all the standard railroad stocks are cheap and the industrial list is filled | with stocks selling at real bargains. “Prudent investors are now buying stocks in huge quantities and will profit handsomely when this hysteria is over. “The list is filled with bargains, and I and my friends are all buying stocks.” Luther L. Blake, president of the SUPERIOR GARAGES IN' ALL MATERIALS TIN ROOFS PORCHES BUILT WE_ BUILD. REBU REPAIR Ax\_lt N N, CONSTRUCTioN *JERVICE The Bank that Makes You | financial publications, sald: “We do not pretend to say that the | bottom has been reached, but the mar- | ket for selected investment stocks is | now in the buying zone, and the invest- | or need not hesitate to buy stocks that | show a reasonable income return at | present prices and show promise of | maintaining their earning power over a period of years. | “To the speculator the only thing one | can say is that many stocks are cheap | if he has the ability to carry them.” factor.”. Mr. Lamont’s statement that the bankers had not been sellers of stock was designed to quiet rumors in Wall street that the bankers had been selling instead of supporting the market. John J. Raskob, Democratic National aduate {§ McCormick Medical Glasses Fitted | College Eyes Examined '} DR. CLAUDE S. 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