Evening Star Newspaper, June 8, 1930, Page 65

News of Markets Pages 1 to 4 Part 6—12 Pages APRILTRADE LOW | I FFTH DISTR, REPORT REVEALS Moderate Volume of Trans- actions Reported by Rich- mond Reserve Unit. RECENT PROGRESS SEEN TOWARD BETTER TIMES Seasonal Expansion of Credit De- clared Less Than Normal This Year. Business in the fifth Federal Re- serve district in April and the first half | ©f May was “in moderate volume only, and probably did not measure up to seasonal levels,” according to the monthly review of credit, business and agricultural conditions in this district, issued by the Federal Reserve Bank of Richmond “On the whole,” said ,the review, dssued by William W. Hoxton, chair-| ‘man and Federal Reserve agent for the barik, “the recovery from the depres- sion which began last Fall has been slower than was generally expected, but definite progress has been made in most lines.” “The seasonal expansion of credit in April and early May was less this year than usual,” the review continued, “re- discounts held by the Federal Reserve Bank of Richmond rising very little between the middle of April and the middle of May, and reporting member banks actually’ decreasing _agricultural and commercial loans to their custom- ers between April 9 and May 14. Bank Deposits. “The volume of both Reserve bank and member bank credit outstanding in this district is much smaller at present than at the same time last year. On the other hand, bank de- posits compare favorably with the fig- ures for May, 1929, a decline in de- mand deposits being practically offset by an increase in savings and time de- posits. Debits to individual accounts, Tepresenting check payments in clear- ing house banks in the leading cities of the district, were seasonally lower in the five weeks ended May 14 than in the preceding like period ended April 9, and also 3.7 per cent below ag- gregate payments in the five weeks ended May 15, 1929, but in view of a generally lower level of wholesale com- modity prices prevailing this year and lessened activity in stock market op- erations, the dccline in comparison, ‘with last year's debits is very slight. “The commercial failure record of the district for April was one of the worst for several years.’ Thé number of failures was less tham the number re- ported for April, 1929, but the labilities reached a higher figure than for any month since March, 1924. Employment conditigns improved somewhat in April and early May, but probably .not as much as was expected with the opening of outside zgtivities. “The reti§l stores, especially those selling cloting, did a larger volume of did in April last year, Easter on April 20 this year, and March 31 last year. Retail trade in April did not overcome the decline reported in March, however, and for the first four months of this year department store sales ran slightly below the sales in the first four months of 1929. Wholesale trade in April was spotted and influ- enced by seasonal trend, but on the whole was in rather less volume than in April, 1929. Total sales since Janu- ary 1 in wholesale lines for which in- hn formation is available show lower fig- ures than in the first four months of 1929, except in shoes, the chief decline being in dry goods and hardware. “The weather since the first of April has been favorable for farm work, but until the middle of May was unfavor- able for seed germination or plant growth. The fruit prospects are spotted, stone fruits having been seriously hurt by frosts and apples iri ‘low-lying or- chards also damaged. Rains throughout most of the district in the latter half of May improved agricultural prospects materially.” Rediscouuts for memiber banks held . by the Richmond Reserve Bank rose slightly between April 15 and May 15, both this year, increasing bg $600,000, or 4.1 per cent, but on the later date stood at a level of $39,680,000, or 70.2 per cent below the volume of redis- counts held on May 15, 1929. Clearings Decrease. While Washington showed a falling off from $302,850,000 in checks g through the clearing house for the period ending April 9, this year, to $279,680,000 in the petiod ending May 14, as compared with $317,727,00 in the period ending May 15, a year ago, it was shown that a majority of the reporting cities showed lower figures, also the district register- ing a total decline in payments amounting to 2.7 per cent. “This de- cline was seasonal, however,” the re- view said, “due chiefly to heavy quar- terly payments around April 1, and does not indicate any material decline in trade during the later five weeks. Retail trade for the district, as re- flected in department store sales aver- aged 11.7 per cent higher in April, 1930, than trade in April, 1929, chiefly due to the lateness of Easter. A fairer comparison, that of combined sales in March and April, with® sales in the same two months last yeas, shows an average decrease in 1930 sales amount- ing to 2.8 per cent, the gain in April not being sufficient to balance the de- crease in March. ‘Washington showed a gain of 8.8 per cent in April. 1930, retail sales, com- pared with sales in April, 1929; a loss of 3.2 per cent for March-April sales combined, compared with March-April, 1929; a decrease of 1.1 per cent for January-April, 1930, sales, compared with January-April, 1929; a decrease of 3.6 in_April 30, 1930, stocks, compared with the same date last year: a decrease of 43 per cent in stocks April 30, as compared to March 31, 1930. Wash ington department stores reported 30 per cent of receivables collected in April. The times the stock was turned since January 1, 1930, was fixed at 1.087. Frank Shiselli, vice president of the Merchants Bank & Trust Co., has been confined to_his home with illness for the past 10" days. Electricity Production. NEW YORK, June 7 (#).—A survey of electricity production throughout the world, made by Pynchon & Co., esti- mates the fotal at more than three * hundred billion kilowatt hours annually, of which the United States contributes 41 per cent. Germany ranks second in output, with 11 per cent, and Canada "1 883,280 for. the comparable month, i barb wire ‘and wire fencing. Demand FINANCIAL AND CLASSIFIED he Sunday Star Classified Ads Pages S to 12 New Treasury Loan Is Sold by Mellon On Favorable Basis Spectal Dispatch to The Star. NEW YORK, June /.—The terms of the new Treasury financing, announced today, fit in with the expectations of the New York financial district, which had come to the conclusion that Secretary Mellon could shade a 3 per cent coupon, in view of the present quotations for other short-term Government issues and for acceptances. The $400,000,000 of 275 per cent certifi s to be dated June 16 will help to refund $550,000,- 000 of 473 per cent notes magur- ing on that date. Not only is there to be a saving of 2 per cent in the interest rate, but a sub- stantial reduction in the princi- pal of the present loan. Not since 1925, when the Treas- ury sold 2% per cent six-month and 12-month notes, has Gov- ernment financing beeén accom- plished on such a favorable basis. ‘The new notes will have a longer life than those that preceded, as they mature on June 15, 1931, whereas earlier «issues have gen- erally extended over nine months. With the retirement of the 47% per cent notes, there are two other Government issues matur- ing this yéar, one carrying a cou- pon rate of 3% per cent and fall- ing due September 15, and the other maturing December 15, with a rate of 3 per cent. There are three Treasury 312 per cent issues maturing in 1932. CHAIN STORE SALE INCREASE IS SHOWN BY MANY CONCERNS Many Firms Report Good, Business for First Five Months of Year. Despite discussion of a business de- pression, 32 chain store companies total sales show aggregate gains both for May and for the first five months of 1930, as compared to May a year ago and the first five months of 1929, For May, according to, Merrill, Lynch & Co., which compiled the table, the results show an increase of 3.95 per cent over May, 1929, while the gain for the five-month period is 3.36 Aggregate gales for the month of May were $161,004,511, compared with $154,- while aggregate sales of these companies for the first five months of 1930 totaled $704,987,544, against $682,005,518 for the corresponding period of 1929. A few outstanding . ones, however, showed decreases, including Sears, Roc- buck with 6.1 per cent decrease, and ‘Woolworth with 11.4 per cent decrease. Peoples Drug Stores showed a gain of 14.1 per cent. The figures for May of both years follow: May, 1930. May, 1929 $30.685,991 $32,603,853 . 576,753 T G 8. H. Kress McCrory Stores National Bell Baniel Reeves niel F. & W. Grand-Siiver 3. Sore Lerner Stores McLellan Stores Co. nt, Inc. 2 $305: ry . Kin Neisner Metropolit Peoples Drux Waldor{ System . Jewel Tea (4 May 17) .. Southern Stores Exchange Buffet . Bickfords. Inc_ . Edison_Bros. Stor Kline Bros. Co. National Shirt Mops. M. H. Pishman Kaybee Stores Morison Elec. Su 161,004,511 $154,883,280 Five months. 1930, 1039, 500,870 $144,179.104 605,328 112,199,190 803 100.853,90 501 Roebuck, May e 1140, P W. Woolworth Cog 110. Montgomery Ward .-+ 106,19 3.°C." Penney 0.6 8 8, S H & Co W. T. Grant .. McCrory Stores Kresgc C ress 9.813.324 487,597 Metropolitan Ch'n’ St. Jegel "Tea” (28 week Southern Stores Exchange Buffet ne a; tores Morison Elec M. H. Fis lec. Bupply Fishman ... 634,872 DECLARED SPOTTY Special Dispatch to The Sta. PITTSBURGH, June 7.—Steel de- mand has become quite spotty, with & decrease in the net total. The sheet market has become almost stagnant, some mills running at barely 50 per cent and that partly on old business. This is due in part to automobile makers decreasing their orders in an- ticipation of lighter production, but an important factor is that this year there has been hardly any demand for sheets for "building purposes, a class of de- mand that usually helps to sustain sheet mill operations at this time of year. Consumption of sheets on farms appears to be as light as in the cities. Demand for wire and wire products is also very light, particularly in nails, for standard or mefchant pipe, used chiefly in building work, had only a slight seasonal increase, beginning late in March, and in the last couple of weeks this demand seems to have de- creased somewhat. Building work, out- side of fabricated structural steel, has been doing very poorly. Perhaps the best sustained demand is for structural shapes, as the structural fabricating shops are very well en- WASHINGTON, D. C, SUNDAY MORNING, JUNE 8, 1930. REACTON N STOCK MARKET DISCDUNS SLUNPINBUSINES Prices End Week Well Above Previous Level—Trading Very Small. COMMODITY PRICE DROP CONFINED TO FEW ITEMS Money Rates Go Lower as New Government Financing Is Announced. BY CHARLES F. SPEARE. Special Dispatch to The Star. NEW YORK, June 7.—In & market of such small proportions as that of this week, movements in individual issues or in groups of stocks are likely to have an exaggerated significance among those who are following price trends for the purpose of making new investments or shifting from one posi- tion to another. In size the market has been about the equal of that of last January, when speculation was also at the irreducible minimum, but average prices for all of the major groups—that is, the in- of earnings issued since last Saturday well above the level of that period. Compared with a week ago the list is about 10 points down. This is not in itself serious. Considering statements of earnings issues since last Saturday and the number of unfavorable dividend changes, this moderate reaction in- dicates that the effects of the prolonged business recession have been well dis- counted. Leading Stocks Affected. The significance of the decline lies in the market status of the shares affected. These include prominent “‘equities” on the New York Stock Ex- change and on the New York Curb, as well as issues that have a large fol- lowing in interior markets. It also embraces the stocks of banks and trust companies and of conspicuous members of the investment trust groups. Of quite as much effect in creating bear- ish sentiment as the weakness in United States Steel, General Electric, Anaconda Copper, American Telephone, Electric Bond & Share and leading investment rails, has been the action of such widely distributed stocks as United Founders' Corporation, - Pennroad Corporation, Transamerica Corporation, Marine Mid- land, Goldman Sachs Trading Corpora- tion and its affiliated companies. It is just beginning to be realized that it is one thing to bring together a miscellaneous assortment of securi- ties under Individual control, but an- other to maintain the price of the stock of the holding company when those of its constituents have a per- sistent tendency to adjust themselves to a basis of actual gs instead of that fixed by competitive bidding for them. At such a time also the com- plexity of these corporate situations is a handicap 1n the marketing of their securities with investors on account of the difficulty of relating the different parts of the corporation to each other. Business Reports Mixed. The business picture is not much changed from that in the second half of May. Commodity prices are still falling, although the drop in the index both here and abroad is due more to the severity of the decline in a few items, such as silver, rubber, tin and silk, than to the earlier moderate shrinkage in quotations of a large number ot commodities, including ag- ricultural products. In some sections of ‘the iron and steel price list there have been important advances of the sort that traditionally indicate an up- ward trend elsewhere. Inventories are gradually being reduced. There are distinct evidences of improvement in sections of the retalling world, with more seasonable weather. On the other hand, many industries are reporting sharp decreases from the week sees the cumulative effect of the week sees the cumulating effect of the depression on dividend policies. Rail- road car loadings most recently report- ed indicate about a 10 per cent reduc- tion from the same period in 1929 and, with one exception, less merchandise and heavy tonnage traffic than in any year since 1922. -Roads Stick to Programs. ‘When railroad executives compiled their budgets for 1930 and agreed to assist the Government in carrying out its program of maintaining wages and continuing to spend the normal amount for improvements, ,they anticipated a period of a few months during which gross earnings might decrease from 10 to 12 per cent from the previous year's level. They did not anticipate, whit they now realize, that they might be compelled to face nearly a year of restricted business. Until recently they went along maintaining their properties just as if they were experiencing the regular seasonal flow of traffic. Con- sequently, 23 have seen decreases in nel operating revenues about three times as large as in gross receipts. An analysis of the operating figures of all the important railroads for the first quarter of 1930 indicates that they have carried out their promise to the Government and, in spite of heavy losses in freight and passenger earnings, have spent almost as much on malhtenance of way and mainte- nance of equipment as in the first three months of 1929. From now on a decided change of policy may be expected. The rail- roads feel that they have played their part and have an obligation to their shareholders quite as important as to others. Naturally, having spent much more last Winter in proportion to earn- ings than ordinarily, they are now in a better position to curtail these oper- ations and can do so with less dis- turbance to the labor market than if they had reduced their forces when unemployment was general. So, while railroad gross earnings will undoubtedly go on falling, the net decreases in the coming months should be smaller and less disturbing to security holders. Money Rates Lower. ‘The effect of restricted industry and restricted. security markets is visible this week in lower rates for practically all forms of long-term money. The spread between acceptances and the Federal Reserve rediscount rate in New York has increased to three-quarters of 1 per cent. As a means of stimulating business or securities, a reduction in the rediscount rate to 21 per cent would I gaged and have a gocd sized order book, not much smaller than that at the beginning of the year. The big item in Stéel Buying News is third with about 6. A e Sunray Oil earned 54 cents on com- &=on stock in March auarter. n the Jast few weeks has been line pipe. The tonnage is chiefly for nat- ural g lllnes.l but n::mm ‘gne? are now coj out, ia : ping. "8 Gaisnan, oy, T P 4 be no more effective than was the cut from 4 per cent to 3 per cent here and in London. There might be some advantage in it to the Government in the refunding of the June 15 Treasury certificates, the terms of which have just been an- nounced. (Copyright. 1020.) A. E. HENZE, concluded his duties as president of Washington Chapter, Amer- fcan Institute of Banking. His annual report showed the largest enrollment on record of local junior bankers seeking to master finance. Reparations Bond Financing Retards | Investment Market Plans for New Loan Held Responsible in Lack of Trading Interest. Special Dispatch to The Star. NEW YORK, June 7.—The past week in the investment market has been merely another section of that “calm- before-the-storm” phase which pre- cedes the coming issue of $300,000,000 German reparation bonds, the first of & number of similar issues through which Germany's war debt is to be liquidated. Meanwhile, a considerable crop of propaganda, good and adverse, has been disseminated throughout the world re- garding the bonds, but one opinion seems to be general—that they will be distributed quickly and securely if the price is right. This has been set un- officially at 90 to 91 for the New York market and at a slightly higher level for the French market. In order to prevent transfers from New York to Paris, the French slice will be made tax free to French holders only. Loan Charges. Since the bankers in charge of the loan must raise a full $300,000,000, and there will be bankers' charges and so forth to pay out of the proceeds, as well as the 8 points or more of discount, the loan will have to carry a face™value of considerably more than $300,000,000 It will probably be in the neighborhood of $335,000,000. It is interesting at this time to com- pare this issue with the $200,000,000 German reparations issue of 1924,-and to outline world money conditions then and now. The 1924 loan was for the purpose of financing the preliminary reparations under the Dawes plan, and it was marketed, as the present one will be, by a world-wide syndicate comprising some 400 ‘banks and 800 bond houses. The centers distributing slices included Great Britain, Prance, Belgium, Italy, Sweden, Switzerland, Holland and Germany. The same set- up is proposed for the new loan. The price of the 1924 loan at issue was 92 and while the specific security, the foyemmenl.ll revenues of Germany and n particular the liquor revenues, was slightly different, the ultimate security, which was the credit of the German nation, was the same. But there the similarity ends. The 1924 loan, in a money market of high rates and scanty funds, carried a 7 per cent coupon. The present one, in a market where low rates prevall, carries a 51, per cent coupon. A glance at the discount rates of the central banks of issue then and now will re- veal the wide difference in money con- ditions, Reserve Bank Rates. The only rate which stands the same today as in 1924 is that of the New York Federal Reserve Bank, at 3 per cent. Other banks of the Federal Re- serve system had rates at 3! to 4 per cent. The Bank of England rate, which is today at 3 per cent, then stood at 4 per cent. The Banque de France today discounts at 2'; per cent against 6 per cent in 1924. Germany's rate, now 4!, per cent, was then 10. Nor- way's rate, today 4!, stood at 7; Den- mark’s is 4, and was 77; Sweden’s, 31, and 5'%; Holland's, 3 and 5; Belgium's, 3 and 5', and Switzerland's, 3 and 4 per cent. The New. York slice of the 1924 rep- arations loan was four or five times oversubscribed in 15 minutes after the books were opened, and the New York Times remarked, “Not since the United States Government sold its big Liberty and Victory loans in 1917 and 1918 for the purpose of raising money to defeat Germany has there been such a wide- spread public response to a bond issue. No Difficulty Seen. No one expects the new loan to go at so rapid a rate, or with the enthusiasm engendéred by the 1924 loan. Neverthe- less, bond dealers forsee no difficulty in disposing of the issue. The 1924 loan sold on the New York, Stock Exchange on the day of its issue as high as 95% and during the years has appreciated until it stands today at over 108. People who originally sul scribed to it at 92 and-who sell it toda at 108 receive an annual return of close to 107, per cent, when their discount at purchase and premium today are fig- red in. Y v On the otheryside of the picture, bond analyzers are inclined to doubt that the new loan will have the market appre- clation of the first loan, .at least not in such a short time. They point out that from now until the reparations debt is completely liquidated and every bond redeemed, there will be frequent similar issues and these will have a tendency to hold a check on the new loan. Despite the dampening effect of thc coming loan on the new capital market the last week saw a total of $117,875,000 new bond flotations, against $46,767,000 in the previous week and $127.653,000 two weeks ago. Listed bonds did little of note. There was some buying of Government bonds in anticipation of the June financing and they rallied fractionally. Foreign credits were firm with the exception of minor fluctuations in South Americans consequent of re- ports of political troubles in Bolivia and Colombia. (Copyright. 1930.) CHICAGO DAIRY MARKET. CHICAGO, June 7 ().—Butter—Re- ceipts, 14,149 tubs; unsettled; creamery, extras, 31%; standard, 313 extra firsts, 2012a30; firsts, 28a2814; seconds, 2 vi—Recelpts, 22370 cases; firm celpts, 22, 3 : extra firsts, 22';; fresh graded firsts, 22; ordinary, current receipts, 19a191;; storgge packed, firsts, . 29;. . storage packed, extras, 23%. FOREIGNBUSINESS IS DECLARED SLOW INMANY QUARTERS Little Recovery Is Expected Before Next Year Unless Stimulus Is Applied. GAIN IN UNEMPLOYMENT IS APPARENTLY GENERAL Transition Period Indicated in Re- ports From Britain and the Continent. Special Dispatch to The Star. NEW YORK, June 7.—Cable dis- patches to the Business Week give the following survey of business abroad for the week ending June 7: Europe.—There are no indications of any improvement in the business de- pression and none is immediately ex- pected. General activity is slack; prices are still weak; competition sharp; profit margins narrow. Looseness of money has increased, but investors are not yet confident, and capital markets are nar- row, with interest rates still out of line with money rates. It is the consensus of opinion that it will be a matter of time before conditions consolidate, with little recovery, if any, before next year unless some unforeseen outside stimulus enters. It is expected that contracts covering the Young bond issue will be signed on June 7 and subscriptions opened in nine countries simultaneously on June 10. Underwriting bankers will buy the loan at a uniform price of 92, less 4 points commission. Issue prices will vary from country to country, accord- ing to respective issue taxes. In France, where the bonds have been tax exempt- ed, a surcharge of 6 points will be add- ed, the proceeds of which are to accrue to the public debt sinking fund.- Effec- tive issue prices will vary, probably being lowest in the United States at 92, and highest in France at 98. British Trade Restrained. Great Britain.—Restraint and uncer- tainty are the keynotes of present busi- ness conditions. Immediate uncertainty centers’in the final terms of the Young bond issue and in Snowden’s conversion loan plans. These, and the possibility of a further reduction in the bank rate, are factors which will determine the future of money and security markets. With unemployment increasing, and expected to exceed 2 millions before the end of the year, weight is attaching to governmental plans to relieve unem- ployment. No definite projects have yet come from the Labor government. Pes- simjsts are inclined to anticipate further increases in taxation despite Snowden's assurances to the contrary. Indecision is also caused by the un- certainty of the course the growing tariff movement will take. Future im- ports arg likely to be profoundly af- fected by the inevitable reconstruction of Britain's economic foundation and the cleaving between traditional polit- ical divisions. Apart from restrictions imposed by world depression, England is manifestly entering an epochal transition period both in its internal structure and ex- ternal relations to the empire. In- dustry is reluctant to enter upon long- time programs; investors are similarly hesitant; and ‘the current outflow of capital abroad, notably to the United States, is not merely a flight from tax- ation, but a betrayal of the basic un- certainty and uneasiness in business planning. In the final analysis, Eng- land must sooner or later export that part of its manufacturing population which has been rendered superfluous by the growing manufacturing autonomy of the colonies. Industry must be freed of the dead-weight cost of supporting the present unemployed, now the major handicap retarding recovery of British competitive ability. No government so far has had the courage to undertake so radical a change in the economic structure, though many governments have recognized the ultimate. necessity. Recession in France. France.—Statements from key indus- tries such as iron and steel, chemicals and automobiles tend to substantiate recent persistent reports of a slackening of activity, though current activity may show little change untlt orders still in hand are executed. New business com- ng in, however, shows distinct contra- action. Government reports also indi- cate a diminishing in the volume of domestic commerce and an increasing number of bankruptcies, though foreign | trade, except in luxuries and textiles, is normal. Recession is not expected to the degree experienced in other coun- tries, particularly in terms of unem- ployment and cost doles, since a chronic shortage of domestic labor enables France to maintain employment by repatriation of foreign labor now present in large numbers. Also, Parlia- ment, which reconvened on June 3 for a 40-day session, is expected to legislate the so-called ‘“national equipment” program which calls for expenditures of at least $200,000,000. Germany.—The recurrent unfavorable balance of government finances and the evidence that existing taxation is al- ready at levels of diminishing returns are the most immediate factors ‘in the profoundly unfavorable general eco- nomic situation. For the third time within one year the country has been obliged to cover deficits occasioned chiefly by record unemployment. The budget now before the Reichstag is be- lieved to be 200 millions short. Total unemployment stands at 2,700,000, of which state subsidized unemployed num- ber 1,950,000, compared with 1,500,000 a vear ago. Capital stringency in turn is accentuating business depression and handicapping revival, Under these con- ditions the only alternative is all-round reduction of government expenditures, a move anticipated in proposals likely to come from Moldenhauer next week. Reduction in Wages. Event of the week is the award by government arbitrators of a 10 per cent reduction in wages in the northwestern steel industry, subject to the condition that manufacturers undertake to make corresponding reductions in steel prices one month previous to the wage cut. ‘This is expected to prove a precedent for co-ordinated readjustment of car- tel-controlled prices and state-regulated wages which will be more nearly in keeping with the lower levels of un- controlled commodity values. Ilus- trating the need for such readjustment is the decline in the price index of uncontrolled prices on raw materials and semi-manufactures from 90 in Janu- ary to 85 in April, whereas cartelated prices remained pegged at 105. The steel award is likely to be followed by coal and other cartelized industries. The conference of German and American sound film interests, sched- uled to take place in Switzerland in the last part of June, it is hoped will gme patent kdltapmu and mued Lge erman market, now, monopol Y Warner, to all Ameridan pfoducers, - that McLACHLEN NAMED PRESIDENT OF D. C. BANKERS' ASSOCIATION 1 McQuade and Pope Elected Vice Presidents and Vass Chosen Secretary. | | Gatley Retained as Treas- urer—Convention Closes With “Family Dinner.” BY EDWARD C. STONE, Special Currespondent of The Star. ASHEVILLE, N. C, June 7.—The twelfth annual Convention of the Dis- trict of Columbia Bankers' Associa- | tion closed at the Grove Park Inn here | this evening with the “family dinner” | attended by nearly 300 Washington | bankers, directors and their guests. | Installation of the newly elected offi- cers featured the closing business ses- | sion earlier in the day, when Lanier P. McLachlen was elected president; | Edward J. McQuade, first vice presi- | dent: C. H. Pope, second vice president: | Albert S. Gatley, treasurer, and George | O. Vass, secretary. | The council of administration, also | eletted today, includes Mr. McLachlen, | E. J. McQuade, C. H. Pope, George O. | Voss, Albert S. Gatley, Willlam J. Wal- ler, Tetiring president, and four new | members, Laurence A. Slaughter. vice | president Commercial National Bank; | F. P. H. Siddons, secretary American Security & Trust Co.; Claude H. Wood- | ward, president Mount Vernon Savings Bank, and W. W. Spaid, partner in W. B. Hibbs & Co. | ‘The members of the American Bank- ers’ Association elected Mr. Waller to serve one year as vice president of the American Bankers' Association for the District of Columbia; Robert V. Flem- ing 'to serve on the nominating com- mittee, and Mr. McLachlen as alternate on this committee, | Will Expand Credit Bureau Work. J. Frank White of the National Bank | of Washington was elected vice presi-| dent of the national bank division, J. E. Troth, Chevy Chase Savings Bank, vice president for that division; J. T. Exnicios, Departmental Bank, vice | president of the State bank division, and Charles H. Doerig, Washington Loan & Trust Co., vice president of the trust company division. Today's| annueal reports showed that the work of the credit bureau has proved of | great value to the banks and will be expanded next year. The association sent greetings to Maj. Frank W. Patterson, former finan- cial editor of the Post, who is now in ‘Walter Reed Hospital. The retiring president, Mr. Waller, heartily greeted the new head of the association and the entire cere- mony was most impressive. As the other new officers were escorted to the platform to assume their duties there | ‘was much applause on the part of the convention delegates. | Tonight's dinner was in charge of | W. W. Spaid, chairman of the enter- | tainment committee. Following the | presentation of gifts to the retiring offi- | cers, a novel entertainment was carried | out in the hotel lobby. Some of the | finest, professional talent in the South | appeared to the great enjoyment of the: guests. Special song hits written by Thomas W. Brahany included some very witty personal jibes at many of the celebrities preseit. These personal verses were printed on the dinner pro- grams and aroused great merriment. Members of the sport committee checked up the scores this evening to ascertain the winners of the golf and other athletic events not already an- nounced, all the cups being presented after the banquet. New President Young Banker, Lanier P. McLachlen, president of | the, McLachlen Banking Corporation of ‘Washington, who was elected president | of the assoclation here today, is one of the youngest bankers to hold this office. | He is 40 years old, was born and reared in Washington and commenced his banking career as a runner with the McLachlen bank in 1909. In 1912 he was made secretary of the bank, later holding that position and the added one of assistant treasurer until in 1922 on the death of his father, A. M. Mec- | en, he was elected president -of the bank. He received his education in the public schools of Washington, Mer- cersburg Academy and George Wash- ington University. During the war he served 18 months in the Air Service of the Army in France, being commis- l | | | | Lanier P. McLachlen (above), was_elected president of the District Bankers' Association at Asheville yes- terday, is one of the youngest bank presidents in Washington. He started his banking career as a runner in 1909 | with the same institution of which he s now the senior officer. Albert S. Gatley (below), vice presi dent of the Lincoin National Bank, w re-clected treasurer, having already served the association in this office for a quarter of a century. sioned as first lieutenant and later as captain. He is a member of the hoard of gov- ernors of the Columbia Country Club, member of the Racquet Club, Board of Trade and the Sigma Alpha Epsilon Fraternity. In addition to being presi dent of the McLachlen Banking Cor- poration he is a director of the Wash- ington Investment Co., Iowa and On- tario Apartment House companies and the Brookland Building Association. Mr. McLachlen has been active in the Distriet of Columbia Bankers' As- sociation for a number of years and- has been chairman of many of its im- portant committees. He was made a member of the council of administra- tion in 1923 and in 1926 was made secretary of the association, later ad- vancing to second vice president, first vice president and now to the presi- dency. Sports Events Winners. In the first golf event of the conven- tion, Robert V. Fleming, president of Riggs National Bank, won the “Pop Fleming Cup,” for the second time. President Waller appointed these committees: Credentials, John M. Riordon, chairman; J. D. Leonard and B. Olds; nominating, V. B. Deyber, chairman; J. T. Exnicious, R. V. Flem- ing and Joshua Evans, jr.: resolutions, John Poole, chairman; F. C. Allison, jr., Howard Moran, Bynum E. Hinton and E. F. Colladay. Clyde B. Asher, director in the Liberty National Bank, won the W. B. Hibbs golf cup for the third time, giv- ing him the trophy permanently. Charles H. Doing, vice president of the Washington Loan & Trust Co., was runner up. Albert S. Gatley, vice presi- dent of the Lincoln National Bank, won the Edward B. McLean Cup in the top spinning contest. Granville Gude, director in the Washington Savings Bank, captured first honors in the horseshoe pitching contest, with James H. Lemon, director in the same bank, winning second place. PRICES FOR WHEAT CROP ARE UNCERTAIN Midwest Business Circles Deeply | Interested in New Yield Prospects. Special Dispatch to The Star. KANSAS CITY, Mo, June 7.—The problem of marketing the coming | wheat crop, the first fruits of which | will be visible in 10 days, is attracting | much attention throughout the in- terior. Estimates of yields are little changed from June 1 and are subject to revision as the actual results of harvesting ap- pear. Favorable weather thus far this month is encouraging and the next four weeks’ skies will materially affect the actual return. Considerable old grain has been moved in the past 10 days to make room for the new crop and has given some ready money to the producing country, stimulating somewhat the sea- sonal trade. Speculation as to what the new crop is to bring in financial betterment is uppermost in business circles and much uncertainty exists. Behind it all is the problem of the | Farm Board and the price level pros- pect. Strangely, after all the demand something done for the farmer, a decided apathy exists as to taking up the board’s program. Or- ganizers are answering questions more than making appeals. The farmer wants to know what is to be the final picture as to grain and live stock if the program reaches its objective. Plainly he is disappointed that no greater progress has been made. The harvest income, and its net buying and debt-paying power, is just now vital, and upon the outcome de- pends trade prospects for late Sum- mer and Autumn. With uncertainty as to volume and prices, little encour- agement exists for expansion, and the interior is in effect marking time. (Copyright, 1930.) Sees Better Copper Outlook. NEW YORK, June 7 (#).—Simon Guggenheim, president of the Amerl-‘ can Smelting & Refining Co., said to- | day before sailing for a European vaca- | tion that the company's business showed “a much improved trend” in comparison with a month ago and that with present copper stocks on hand be- GRAIN MARKET Wheat Prices Topple Again After Break in Stock Market. CHICAGO, June 7 (®)—Staggered by stock market breaks, wheat prices toppled heavily over today, and at no time displayed much power to recover. Contributing to the instability of wheat was the fact that no export demand of any consequence was heard from, holi- days abroad causing a halt. Further- more, the outlook appeared to be for only a moderate reduction of the United States wheat visible supply total on Monday. Wheat closed shaky, %al a bushel lower than yesterday's finish. Corn closed %a’s Off and oats lxals down and provisions unchanged to a set- back of 15. Jolts to confidence on the part of friends of higher prices for wheat came quickly today from New York dispatches telling of securities breaking to new low record quotations for the year. The action of the stock market served to focus the attention of wheat traders on bear factors, and to minimize the effect of influences that normally would 1ift the grain market, notably persistent lack of rain Northwest. Under such circum- stances, buying support for wheat was decidedly scant at times. In some quarters, nevertheless, much significance was attached to a compre- hensive crop report from Canada indi- cating that despite 1930 early seeding the growth of Canadian wheat is now no further advanced than it was a year ago. This showing, the report said, is due to cold weather, severe frosts and absence of subsoll moisture, all of which are conspiring to prevent normal crop development. It was also pointed out that the Canadian week end forecast pointed to falr weather, and gave reason for increasing alarm over the Canadian crop. ‘The table: September December . CORN— July September December OATS— July . September December July u B Se=tember December ing well lharbl:pfle, he looked for defi- nite improvement around Oetober ' i¢ NEW YORK, June 7 (F).—Next! week's operations of Youngstown 8] & Tube will remain unc! per cent of eapuoity. IVESTHENTTRUST PROBLEN BROLGHT TOPUBLICNOTE Resignation of Catchings From Goldman-Sachs Co. Arouses General Interest. BRITISH AND AMERICAN POLICIES ARE COMPARED Effect of MarkKet Crash on Some Companies’ Securities Was Severe. BY JOHN F. SINCLAIR. Special Dispatch to The Star. NEW YORK, June 7.—When Waddell Catchings, 50, resigned recently from the presidency of the $250,000,000 Gold- man-Sachs Trading Corporation, one big investment trust, as well as from his membership in the old Wall Street firm of Goldman, Sachs & Co., it brought to public attention the spectac- ular career of this New York banker since the war. But more than that, it brought vividly to the attention of the public, the prob- lem of the investment trust. Few American business leaders have had more experience in this field than Mr. Catchings. Goldman, Sachs Co., known in every country ‘in the world, is the financial agent for 46 American corporations. Mr. Catchings represented the company on the boards of more than a dozen of them, includ- ing such well known companies as the Studebaker Corporation, Postum-Cereal Co., Sears-Roebuck, National Dairy Products, Cluett-Peabody, Continental Can Co., Endicott-Johnson, and Warner | Brothers, Mr. Catchings’ sudden with- drawal from the firm, therefore, has been the cause of widespread comment. Stocks Popular. The Goldman-Sachs Trading Corpo- ration stock, under Mr. Catchings’ leadership, was issued in December, 1928, at $104. The stock was popular. It rose rapidly. Then presto—it was split two for one. In August, 1929, the split-stock was selling at $116 a share. Everything looked rosy. The Shenandoah Corporation wi formed. It, too, was a trading inves ment trust, organized in July a year ago by the sale of 1,000,000 shares of commion stock, offered at $17 a share. A few weeks later, it moved up to $42; while 1,000,000 shares of the Shenan- doah preferred, first offered at $50, went to $60. Notl':ilng looked finer— everyqthing hunky-dory. . 'Ige Blue Ridge Corporation—a third Goldman-Sachs _venture—started late, on October 23, 1929. But the market crashed shortly afterwat@ and this company had little chance to expand, like its two lusty, healthy, shouting brothers. ‘When the market did crash, Shenan- doah dropped from 39% to 67 Blué Ridge from 29% to 3!. Now Blue Ridge is selling at around $11 and Shenandoah at $14. This story is typical—similar to the stories of hun- dreds of others. That's why it is used merely as a graphic illustration. What of the future of the invest- ment trust? Nearly 500 of them exist in the United States, with assets prob- ably exceeding $4,000,000,000. They are not supervised or controlled or directed, except by their officers and directors. They make no report of any kind to either the State or the Federal Government. They have grown up rapidly and are of many different vari- eties—fixed, semi-fixed, security trad- ing corporations, and general manage- ment_companies. In England—home of the investment trust—the cardinal principle is to “minister to investors who are unable to maintain a continuous vigil over their security holdings and who, any event, could not hope to be as uniformly successful ~with limited capital as the trust with its great aggre- gate .resources.” ‘This principle has built the British investment trusts into positions of great power—essentially conservative, - not speculative ‘as ‘in- the United States. Dr. Leland’ Robinson, one of Amer- ica's leading authorities on investment trusts, in an estimate made of British trust holdings, found that they owned bonds to the extent of 45 per cent, preferred shares to the extent of 23 per cent and common shares to the extent of 32 per cent. British Investment Policy. ‘This shows how important the bond investment is considered in England. Quite the reverse is true in American companies. In a recent analysis of the reports of about 40 investment trusts, with holdings totaling $1,500,000,000 on December 31, 1929, their average bond investments amounted to only 6.35 per cent of the total resources, preferred stocks amounted to 4.69 per cent, and common stocks absorbed 69.95 per cent—while 13.94 per cent con- sisted of cash and call loans and 5.07 per cent of the assets were of miscel- laneous character. The portfolios of 21 companies (the only ones reporting) revealed that 11.31 per cent of the common stocks held by them were railroad issues, 31.84 per cent public utilities, and the remaining 56.85 per cent bank, insurance and miscel- laneous stocks. Obviously a wide differ- ence in the investment viewpoint of the management of English and Amer- ican companies. Another distinction between the in- vestment trusts of Great Britain and the United States lies in the fact that the British companies continue to make it a practice, as they have from the be- ginning, to pay dividends “only out of current . income, so that “profits from the purchase and sale of securities are allowed to accumulate as reserves.” I know of few American companies fol- lowing such a_conservative practice. Again, the English trusts publish a list of their portfolios at least once a year. A few American companies fol- low this practice, but the vast majority give but a thumb-nail report each year. In the “golden days” of 1929, the sky was the limit. There seemed to be no top prices. ‘Thus one corporation, for example publicly advertised that it would take United States Steel at 238, Union Car- bide & Carbon at 119, Allied Chemical at 324, General Electric at 395, and would give its own stock in exchange for these various securities. The four shares would have cost the trust $1,076 After the crash the four were worth $595.50. Assets Shrink. ‘Thus the assets, of just 15 investment trusts associated with some leading banking houses, showed a shrinkage due to stock market losses of $175,725,000. Another investment , not in cluded in the 15, has but recently pub- lished its statement, disclosing that it ‘owned “over 3,000,000 shares of com- hox ‘stock: of & public utility compan; the ‘market for which v% made on ! on