Evening Star Newspaper, September 14, 1930, Page 77

News of Markets Pages 1 to 4 -— .P_lrt 6—14 Pages SPEAKERS CHOSEN FOR D. C. MEETING OF FINANCE FIRMS Thorpe, Dr. Parker, Whitney and Others on Four-Day Program. GROWTH IN SMALL LOAN * BUSINESS IS REVEALED $500,000.000 Lent Annually for Personal Credit, Survey Reveals. BY EDWARD C. STONE. Details of the program for the com- fng convention here of the American Association of Personal Finance Com- | panies state that the speakers will in clude Merle Thorpe, editor of the Na- tion's Business; Dr. Frank Parker, economist, Wharton School of Finance, Philadelphia; A. F. Whitney, president, Brotherhood of Railway Trainmen, and several State officials and social work- ers. This national organization of State- supervised companies operating under the uniform small loan law meets at the United States Chamber of Commerce Beptember 23 to 26. The al finance business, which extends credit in small sums to persons ©f modest means, already operates un- der State supervision in 24 States. It is the prediction of W. Frank Persons, executive vice president of the associa- tion, that the increasing demand for consumer credit will make inevitable the adoption of similar legislation throughout the country. “Already 24 States have the uniform small loan law sponsored by the Russell Sage Foundation or legislation similar to it on their statute books,” Mr. Per- sons said. “In these iu:ad personal finance companies operate under super- vision of the banking rtments,” Mr. Persons added, “their charges for per- sonal credit service are regulated; and they are required to comply with cer- tain administrative provisions which rotect the borrower and which are urther of material assistance to our national organization in maintaining high standards of business practice within the industry. “It was only a few years ago that men of distinction in business circles merehandise _installment business with some alarm. Now the in- stallment business in standard lines of merchandise has increased to the amaz: total o&u:bflut tl.m,ooo,:m ann ally. oOf grea of Penonl credit extended in the . Unilf annually, the Russell Sage Foundation estimates that fully $500,000,000 is be- ing loaned in sums less than $300 under the Ymvhhm of the uniform small loan law,” he said. Institute Courses Listed. Registration opens this week for courses offered by Washington Chapter, A. I B, at bankers' headquarters in the Becker Building on F street. The courses of instruction are more extend- ed this year than ever, and the younger bankers are displaying such enthusiasm that a record attendance is expected. ‘The courses in the first semester in- clude commercial law, standard eco- nomics, credits, banking fundamentals, negotiable instruments, investments, fubllc discussion and debate and prob- ~ lems in personal efficiency. This year's faculty is made up ®f Eliot H. Thomson, Harold W. Burnside, Dean Raymond B. Dickey, Bolitha J. Laws, F. J. Donohue, Edward J. Mc- Quade, James D. Cushman, William G. Buchanan, James C. Dulin, Theodore Coggswell, Dr. George Farnham and Mrs. Anne Tillery Renshaw. Classes begin on Monday, September 22, In a message of greeting to Frank M. Perley, this year's chapter president, Lanier P. MacLachlen, president of the District Bankers' Association, notes the fact that 60 graduates of the chapter are now connected wtih Washington banks. District National Plans Expansion. Joshua Evans, jr. president of the Pistrict National Bank, announced yes- terday that the directors have author- + ized quite extensive interior alterations to_the banking quarters. ‘The contemplated changes will pro- vide more spacious facilities for the trust department, enlargement of the safe deposit department and make it possible to consolidate the work of the hookkeeping, proof and clearing de- artments. # The work will begin immediately and 1t is expected that it will be completed about December 1. The departments mentioned have been cramped for space for a long time, and the move, is the first of the kind taken since Mr. Evans PBecame president of the bank follow- ing the retirement of Col. N. Harper. TOBACCO CROP CUT DOWN BY DROUGHT Yield of Virginia Farms Is Esti-| mated at 500 Pounds Per Acre. By the Associated Press, sy RICHMOND, Va., September g Drought has reduced the Virginia to- bacco crop to a probable yield of 500 unds per acre, the lowest yleld figure f: the State since 1869, John A. Hicks, State and Federal statistician, said to- 4day in a report on the basis of condi- ons on September 1. uT]'u! repo;tmufld the condition on the first of the month was 46 per cent nor- mal, and the total production was fore- cast to be 91,000,000 pounds, more than 10,000,000 poumds less than the forecast n_ August 1. g A.ssu%a“m( the present prospective crop will bring the average price, received over a period of five years, the report said, the total value of the crop would . be $4,184,000 less than the $19,978,000 estimated value of the 1929 crop, $6,956,000 less than the average of the crop during the five-year period. Mr. Hicks said the crop entered Au- gust with conditions far below normal in all type districts, and continued to de- © teriorate rapidly throughout the month, ‘except in the ley section including the southwesterr. counties, where con- nmeublet ur’AvAmvnnfnt “;u reported as | the result of August rains. £ “"The crop usually stands dry weather iremarkably well, and responds to light / ‘rainfall better than any other crop wn in the State,” he continued. “But ¢ e prolonged Summer drought and ex- ces&ely high temperatures du: July and August this year in the n to- bacco counties have been the erop could stand. The pla now reeched such a stage in ‘with _unusually favorable oughout Septembel * 2 casg be expected. > | speculator attacked the junior securi- - i 30, 1930, shows net surpi I On Advisory Board MELVIN A. TRAYLOR, Former president of the American Bankers' Association, and president of the First National Bank, of Chicago, has been elected a member of the Fed- eral Reserve Advisory Council, to take the place of the late Frank O. Wetmore, former co-chairman of the First Na- tional. Mr, Traylor is known person- ally to many Washington bankers. INVESTMENT BOND INDEX AGAIN RISES Market Advances to New Peak, Despite Fresh Offer- ings of Securities. Special Dispatch to The Star. NEW YORK, September 13.—Despite the fact that the investment market during the past week had to absorb twice the amount of new bonds that it did in the previous week, the market managed to advance to another new high noch and activity in listed issues ‘was maintained at a high level through the six market sessions. Money rates showed no quotable change during the week, the only fluctuations being the dally change in the amount of unlend- able funds at the market's disposal. Secretary Mellon’s offering of $325,- 000,000 one-year Treasury -bills at a new low record of 233 per cent was four times oversubscribed, providing some evidence of the amounts of money seek- ing high-grade investment. The broad- ening of investment ‘demand to other parts of the list besides the gilt- edged or legal group made some prog- ress dur the week, but it was slow work, Wi the Iinnumerable special factors affecting practically every bond except those whose security is unques- tioned and whose price is aflected merely by money rates and market conditions, Gain in Index. At the beginning of the week Stand- ard Statistic’s index of 30 issues, which is based on the 1926 average adjusted to a 100 basis, stood at 101.5, and at the end of the week it had advanced to 101.6. This gain was made despite the fact that the week’s budget of new bond offerings was $134,296,000, against $67,- 159,000 in the previous week and $131,- 695,000 in the same 1920 week. Much of the new offerings consisted of good grade rails such as the St. Louis-8an Francisco issues of $10,000,000 4; per cents, due in 1978 and priced at 92% to yield about 4.90 per cent, and the Chicago & Northwestern $12,000,000 4; per cents, due in 2037 and priced to yield close to 4.50 per cent. Other issues were similar in type and price to the $15,000,000 Electric Power & Light debenture issues of 5 per cents, of- fered at a price to yleld 5.40 per cent. All these commanded a ready re- sponse;, especially the public utility offerings, since their yield was a little wider than that of the rails. But large blocks of these bonds were immediately taken off the market by insurance companies which have had difficulty in recent weeks in filling their portfolio needs without resorting to open market buying. The result was that savings banks and trust funds, which are con- fined to investment in legal securities, were still forcing these descriptions to new high levels. Selling Pressure, This virtually left the rest of the list to the professional speculator and the mdividual investor. ~The last named, market wise, is still small in stature. Most of his money is in the savings banks. The specfint%n npen"., ‘tr::mwuk trying, with varying degrees 3 to force breaks in various secopdary and tertiary securities. South Americans, for instance, were sold as political developments came to a crisis in the Argentine and m.::r South American issues were sympa- thetically affected. Brazilian credits were liquidated on news that a revolt was imminent there. Peruvian and Uruguayan credits became depressed when rumors arrived that relations be- tween the two were strained. The con- tinued price declines in commodities on which the bulk of the South American trade depends proved a factor affecting all_these bonds as well. But since the speculator was unable, to any great extent, to interest the public in selling South Americans, he had to cover his short sales by buying back from fellow professionals, and the result that South American bonds had a strong tone at the end of the week. Similarly, with railroad earnings still showing l’ pronounced falling off, the ties of the roads, especially those of the weaker carriers. That they did not fall to new low levels was solely be- cause once again the public failed to follow the selling. (Copyright, 1930.) —— RAILROADS OF CUBA SHOW HIGHER SURPLUS Special Dispatch to The Star. ‘ FINANCIAL AND CLASSIFIED Classifiéd Ads P Pages S to 13 he Sunday Star WASHINGTON, D. C, SUNDAY MORNING, SEPTEMBER 14, 1930. ISTOCKS UNCERTAIN AS SIGNS OF TRADE REVIVAL ARE SEEN Reaction in Market During Week Marked by Drop in Trading. PUBLIC PARTICIPATION 1S ON INCREASED SCALE Continued Ease in Money Rates Gives Aid to Bull Party. BY GEORGE T. HUGHES. Special Dispatch to The Star. NEW YORK, September 13.—Busi- ness sentiment is a liftle more cheerful this week and there are more tangible facts to support the optimism, if it can be called that, but the stock market is not so sure as it was. Prices for typical issues have made a new high since last Spring, but the gains were not held and any indication of a sustained advance was entirely absent. Signs of Recovery. Signs of trade recovery are few in number, but deserve consideration. In the first place, there has been a check to the fall in commodity prices, not- withstanding the renewed break in wheat. The compilation made by Dun & Co. shows 38 advances in wholesale quotations against 28 declines, in com- on with last week. There are plenty of striking exceptions to the trend besides wheat, one of which is rubber, which went to a record low. The metal situation leaves much to be desired, with copper still quoted under 11 cents a pound. The August statistics were xpectedly discourag- ing. On the other d, there has heen a turn for the better in the domestic hide market and significant resistance to pressure in many other directions. Car loadings are increasing and the rate is a little larger than the seasonal normal. If this trend continues it will foreshadow the real turn in trade, for which all have been looking. Then there are better reports from the textile industry snd from the department stores, which are experiencing the pick- up in Autumn demand. It is a little Meult to diagnose the situation in steel, with the authorities at variance, but.at-least matters are no worse than they were, New High for Stocks. As for the stock market, gréat hopes were raised when the averages made their new h&‘; early in the week,.On Wednesday 90 stocks included ‘4n the Standard Statistics index closed 173.6, whereas the high of last July, reached on the 28th, which was the bes since the June break, was 170.1. Re- newed professional operations about a setback from this point, leav- ing the market with a ragged and un- certain appearance, The chances are that the reaction is not as important as it appears on the surface. For one thing, volume was al- ways larger on the advance and fell off on the decline. The turnover is still abnormally Jow, much to the distress of the brokerage fraternity, but it is larger this week than it was a week ago. For the four full five-hour business sessions for the week ending September 5 the #verage sales were 1,672,475, and the average for the five days ending Sep- teimber 12 was 2,060,760 shares. Another evidence of an increased public participation, slight, to be sure, but welcomed in Wall street none the less, was the increase in brokers’ loans. They are up this week $33,000,000, against an increase ‘week of $8,000.- 000. rise in total is favorable rather than otherwise. It will have to g0 much further before any concern is aroused, with the total back where it was in 1927 and the ratio of borrow- ing' by members of the exc] against stock collateral down to 5.31 per cent of market value of all shares Msted, a new low since this computa- tion was begun. Stocks are in strong hands. ' Money rates continue easy. If the Autumn trade improvement fails to ‘arrive on time, or if there are other now unan- ticipated adverse developments, the market would react regardless of i technical ition, but there will be no hasty liquidation. On the other hand, if business gains at a faster rate than now looked for, the market is sure to nne|cv. the situation with a higher price level. Perhaps the strongest argument against rising quotations for stocks is|is that they have not yet been brought down to a point where the investment return on issues with unquestionable dividends is sufficlently attractive. It is urged that the price-earnings ratio today is higher than it was in any other major depression. For example, the 90 stocks used in the Standard Sta- tistics averages are selling over 15 times estimated 1930 earnings, which the critics say is entirely too high. (Copyright, 1930.) AUGUST DIVIDEND CHANGES SUMMED UP 26 Decreases Reported Against None Year Ago — Longer Period Is Also Reviewed. Special, Dispatch to The Star. NEW YORK, September 13. — Con- servation of resources, pending a more favorable trend in general business con- ditions, is indicated by the dividend ac- tions of various boards of directors in August. Figures eumsgu by the Standard = Statistics . show 26 decreases during the month in compari- son with none in August, 1929, and 55 dividends passed as compared with 11 in the same period a year of Cuba, 1 year ended an increase of $168,629 over the net surplus reported for the year. Income from dividends on stock owned, interest and the income from securities, amounted to $2,789,961 from which ucted administrative and ses, leaving net income of $2,754,971. . Current cash is shown as $739,388, which added to the $591,035 invested in marketable secur- ities, made a total of $1,330,423, an in- crease of $212,489 over current cash in the previous year. Total current assets amounted to $4,056,530 inst total more than | current liablities of only $610,508. pisbigies- R SILVER QUOTATIONS. 13 (#)—Bar go. Detatled figures for August, 1929 and e | 1930, ‘and for the first eight months of the two years follow: Aug (O ths monthy . 31, Ry 1 B 44 icreased Biotnmee! trs itial %fi; o DAVENPORT HOSIERY. NEW YORK, September 13 (Special). —The directors of Davenport mllu'y Mills declared today the r quar- terly dividend of $1.75 per on the stock, rnblc October 1, 1930, to_stockholders of record Se !‘fmber 4 :°|lo u:"e regular il ividend of cen share on common_stock, Octob#t 15, to stockholders of record October 1, sht e [ Jast much longer. Business News in Retrospect Washington Bankers Are Concerned Over Practice of Issuing Checks Which Are Not Backed Up With Sufficient Funds on De- posr BY I A. FLEMING. Banking business in Washington is thoroughly organized and through or- ganization bankers have uprooted many practices that have been 4njurious and brought matters generally where united effort has given the banker a fair profit for his service. One evil, however, seems to be too deeprooted to be voided entirely. Ref- erence is made to the overgrown hab- it of issuing checks efther without suf- ficient funds to as- fure their ult‘:‘ paid on presenta- flon, or by ante- dating, failing to sign at all or in some way to neces- sitate the return of the paper to the bank on which it is drawn after passing through the various chan- nels the clear- ing house and en- taill a large 1. A. Fleming. amount of useless work. 1t is rather a hard matter to believe, and yet it is a fact that the bankers of this city seem powerless to check the evil, admitting that 116,000 of this char- acter passed through the clearing house and were dishonored during the year 1929. This is substantiated by the record. Government clerks are frequently guilty of putting out checks in ad- vance of the deposit they intend to make, but they are by no means the only offenders, It is a general habit. Back to the Cashier. All returned checks are first passed to the cashier of the bank on which drawn for inspection. Many of them are given the cashier’s O. K., and they are honored with a notification to the maker to make a deposit, while others are turned down for good, be! sent back to the indorsers responsible for them and charged to his account, ;lhiledthe clearing house must be reim- rsed. Make Them Pay for Service. Aficlliwd edeflort has been instru- men! n ucating the people of Washington in the point where they believe it is right for a bank to make & profit on its service. Depositors have been taught that a certain balance must be carried on deposits with one's bank to pay for the services rendered in caring for the work incidental to gt.n:lm of the account and payment Last year one or two bankers made charges on returned checks, dishon- ored for any reason, the double work incident to the caring for these checks to warrant the impost. In the instance referred to the bank credited a fairly large bunch of cash as profit from the returned paper. Other banks familiar with the matter are making their plans to educate the check-kiters, anticipators and all others ‘who use the bank’s funds on one ex- cuse or another, with perhaps less in- dm'jnnee to the evil, once it is made costly. . No Radical Improvement. Just because the American people find it hard to believe that there can be anything but a bull market in Sep- tember, October and November, with much “window dressing” in December, and not from or by reason of any radical improvement in the situation, stocks have shown a little better tone, People have been gloomy so long that they are anxious to get over it— they do not want to be calamity howl- ers; their faith in the United States has always been supreme and they cannot believe present unhappy conditions can ey would rather cheer for an upward movement in stocks than for a bear raid. For this reason the public is not in the market; room lers seem to be wholly responsible for the modest back- ing and filling movements of today. Occasionally some investor will find a stock quoted at a price that he cannot resist and a buying order is placed, but ts | these orders are not numerous. Must Improve. Manufactured stocks are being con- sumed; buyers are cautious, but they are not striking; certain lines are func- tioning nearly as usual, and there is some business being transacted every day. The Government at Washington busy in all departments, and that makes much business here. Merchants will not get as large a share of the millions accumulated in Christmas savings funds, but there will be enough to make a good holiday trade. A Few Random Thoughts. Said the Wise Man: “I took a loss of $5,200 on 20 shares of stock yester- day, atter of $260 a share, and,” he added, “that was in addition to 13 months’ interest.” Theré are many who have not lu;gped the interest. ennecott on a 2 per cent basis! It is indeed difficult to shut down produc- tion, cut prices and maintain dividends: Interest on deposits is one of the most imj t items in a bank's expense account. It is bearing hard on the banks this year. One of these days they may cut that venerable 3 per cent rate. DECLARES TRADE ABROAD SHOWING IMPROVEMENT Special Dispatch to The Star. NEW YORK, September 13.—Euro- pean business is improving, Thomas J. ‘Watson, president of ' International Business Machines Corporation stated on his arrival here from a three-month business trip abroad. M “Our European business is showing very satisfactory Improvement this year and after visiting seven foreign countries and interviewing representa- tives from 19 countries, I am satisfied that general European business is im- proving. Onme outstanding evidence of progress is in the new bulldings and construction work which I noticed un- der way in all countries visited,” said Mr. Watson. “ g the tariff, I believe all countries are giving consideration to prof their home pay rolls through & tariff, where they feel it is necessary, on products which they can manufac- ture. to better advantage than they can buy from other countries,” he con- cluded. MAIZE DIVIDENDS, NI YORK, September 13 (Special). —mr‘:m of American Maize Prod lucts regular quarterly R S common o ferred, rbh 30, to stock- umr;" record 18, Institute Speaker PAUL V. DETWILER, Former president of the American In- stitute of Banking, is to address the junior bankers of this city Tuesday evening at the Willard. He is assistant | eashier of the Philadelphia National Bank and an institute instructor. More than 900 tickets have been issued for the meeting. TURN FOR BETTER SEEN BY BANKERS Slight Balance on Favorable Side Indicated Recently, Current Review Says. ‘While industry and trade continued at low ebb the past month, business de- velopments were about equally divided, with possibly a slight balance on the side of the favorable, says the current review of the American Bankers' Asso- clation Journal. “There was an important resumption of operations in the automobile industry after somewhat longer than usual shut- downs for vacations, and two other key industries, steel and building, have shown signs of improvement,” the review says. “Confidence that there will be some Tecovery in business this year is becom- ing much more pronounced. Conditions warrant the usual seasonal upturn. It is difficult, -however, to find factors that may be relied upon to carry this move- ment further upward to the prosperity level for all lines before the end of the year. “The inventory situation is always one of the ¢hief factors affecting future business activity and profits. Compari- son of the June 30 balance sheets of 150 representative corporations shows that the reduction in inventorfes as com- pared with one year previous has not been impressive, although there has been some reduction, amounting to slightly m,nl;; than 7 per cent for the group asa whole. How Inventories Stand. “Actual size of inventorles is a ques- tion about which there appears to be considerable difference of opinion. It has' been stated that curtailment in roduction has been greater than fall- off in consumption, with the result that stocks have worked down materi- ally and in some industries so low that quickening demand would immediately be translated into higher production schedules. .Other opinion is that in- ventories everywhere are excessive, that their presstire on the markets is respon- sible for the continued decline in prices and that it will take several months to reduce them to normal size and war- rant a genuine recovery of business. “A _study has been ‘made of corpo- ration balance sheets published the past two months, comparing inventpries June 30, 1930, with June 30, 1929. The number of reports available is limited. Of the 150 reports 86 showed smaller inventories than a year before, 64 larger, while combined total decreased from $1,548,000,000 to $1,436,000,000, or by 7.3 per cent, Some Vital Comparisons. Following is a summary showing com- bmeg‘_mvenmm in mljoro lnmgush'hl COMPARISON OF MERCHANDISE INVEN- e e bk (In Thousands of Dollars.) Bullding materials. Chemical products. Electrical cavipm at oducts 25538 St ,_non. Eaper ‘prodi Petroleum X ubber ma; Textiles ‘& apparel. Miscellancous Total ..... 1,436,356 31, 8, “The showing of individual groups is apt to be influenced unduly by one or two outstanding concerns and the per- centage change is only a rough indica- tor. General Motors accounts for such & large share of the total that it is shown separately from the other groups. If the decrease of $57,000,000 in its inventories were eliminated, the aggre- gate inventdries of the remaining 149 companies would show a decrease of only 4 per cent. The decrease is per- haps less than expected, and in part reflects merely lower prices. Neverthe- less it is & development in the right di- rection.” S mama o, 8888sunt Sl i S5 SUN LIFE INSURANCE INCREASES REPORTED Special Dispatch to The Star. JASPER PARK, Alberta, September 13.—"“The business of the Sun Life As- surance Co. throughout its world-wide organization shows an increase for 1930 of 11 per cent over the abnormally pro- ductlve year of 1920. For the first seven months of last year the company received $6,600,000 in cash in the pur- chase of annuittes and during the same period of 1930 it has received almost $9,000,000,” said Vice President Arthur B. Wood today addressing the closing session of 400 American Sun Life rep- resentatives at their annual convention. “If life insurance can be taken as a meter of fundamental business con- in the United States and ,” he continued, “these figures, based for the most part upon returns from the two countries, would indi- cate that these conditions are healthy and progressive.” RETAIL SALES OFF. NEW YORK, tember 13 (Special). —Consolidated Retail Stores, Inc., ré- Ehee s s e o t, as compa 910, 'tu-Am"'.uuu month in 1929. is & decrease of $192,970, or 10 per cent. SEASONAL PICK-UP NOTED IN SURVEY OF FOREIGN TRADE Irregular Trends Occur Some Lines, but Apathy Is Passing. in FLOTATIONS OF BOND ISSUES ARE EXPECTED ' Steel, Hides ,and Leather Industries Reflect Mild Upturn. Iron, Special Dispatch to The Star. NEW YORK, Seplember 13.—Cable dispatches to the Business Week give the following survey of business abroad for the week ending September 13: Europe—It is increasingly apparent that at. least some degree of seasonal pick-up is making itself felt in prac- tically all countries. Although tangi- ble evidence of actual improvement so far is lacking, business sentiment is distinctly freshening. Stock markets responded during the week to the new stimulus, and there was a decided strengthening in all larger centers, par- ticularly in London. It may be ob- served, however, that these stock mar- ket gains were achieved within nar- row, chiefly professional, trading, and that no small part was attributable to technical - reaction from previous over- sold conditions. There are, however, numerous reports of the relaxation of | business tension from a state near paralysis during the Summer to still irregular trends varying according to country and industry, and even to in- dividual enterprises within the same |, category. ‘The improvement is still more notable by contrast with the pre- gedlng apathy than by any new- ounded conclusion that business is turning a corner. Nevertheless, with a problematical Winter ahead, even small gains during the Fall will increase the ability of business to carry through to a broader basis for the revival expected in the Spring. Banks Incorporate. Greater financial enterprise is also noticeable in most centers with the be- lief current that bond issues will soon be resumed. Six European investment banks have incorporated in Switzer- land a fixed trust to be known as Soclete Internationale de Placements (SIP), and will issue their own col- lateral certificates covering selected securities in 10 countries. It iy fur- ther proposed that an international mortgage bank, which will take ad- vantage of low-cost Western European capital, be organized to operate in the high-cost central Eastern areas of the continent. This would assist toward a much needed redistribution of capital congestion along the seaboard, particu- larly in Prance. Great Britain—The return of opti- mism noted in the last few weeks visibl; gaining strength, although lctun{ evidence of improvement in trade is still slight. The iron and steel in- dustry reports improvement, and there is increased demand for cotton. Hides and leather are also firmer, but wool, jute and manufactured goods remain quiet. Wheat prices fell sharply this week, Money is still easy. Coal Under State Control. Following the reorganization of the raflways, electricity, gas and broad- casting industries, coal, henceforward, will be under Stat control. This reflects the rapid progress which Britain is making toward nationalization of its major industries. Under the new plan, industries are not controlled by state bureaucrats but by their own execu- tives acting under state approval and veto, . Miners' wages remain a snag, the owners insisting that with reduc- tion of working hours. December wages must be adjusted downward. Government departments are relying on new marketing schemes plus improved trade to make this unnecessary. Following the decision of the trade unions, at their conference in Man- chester, that free trade is no longer a rigid principle, and now that it is known that certain Liberal leaders fa- vor import duties as a means of ad- justing internal price levels, ex-Chan- cellor Churchill stated: “There is a measure of common agreement among all parties that the tariff for revenue on foreign imported manufactured goods is bound to come.” This is sig- nificant of anticipated political com- promise on the question. Business cannot go forward with the usual confidence during the present uncertainty of fiscal policy and efforts are spreading to force either a realign- ment of parties on the fiscal question or to force a general election, the desire being not so much to have a Tory government as to have a government with full parliamentary power for five years. It is necessary for effective fu- ture planning that business know future taxation and import policy. France.—The world-wide business de- pression continues to cause & persistent decline in foreign trade with production limited accordingly to the demands of the domestic market. National busi- ness, however, still views optimistically the coming Fall seasonal pick-up and general revival of activity throughout the world. Premier Tardieu is uneasy over the outcome of the budget appro- priation because he is pledged not to demand new taxes or to increase exist- ing rates. [Expenditures already re- quested now exoceed last year's outgo by $196,000,000. After the annual con- gress in October of the Radical Social- ists, strongest opposition, Tardieu is ex- pected to try political conciliation with more than likely cabinet changes which may make it possible to form a new ma- Jority and force tax increases, now ob- viously inevitable. Foreign trade figures for the first seven months of the present year have been released, showing that imports from Germany totaled $184,000,000, an in- crease of $43,000,000 over the total for the first seven months of 1929. From the United States imports were valued at only $148,000,000, a decrease of $22,- 000,000 from the 1929 record. Exports to Germany dropped $8,000,000, to 103,- 000,000; to the United States, they dropped $17,000,000, the total value be- ing only $58,000,000. Germany.—The approaching elections on September 14 completely overshadow as well as hold current business in sus- pense. Internal schisms among extrem- ist parties.lessen earlier fears that the elections will strengthen the opposed Communistic and Nationalistic wings and the pmgect of a deadlocked par- liament which might result in the dec- laration of a dictatorship. Actually, the operating majority of the Bruening coa- lition of moderate parties is still dis- tinctly uncertain. Business is puzzled in its attempts to reconcile conflicting electioneering optimisms with unchanged pessimistic ‘F:m from industry and the trades. e Institute of Business Research, in its current forecast, aban- dans all for a material i pick- up and the unfavorable effect 000. EDMUND PLATT, Vice chairman of the Federal Reserve Board, who has formally resigned, at the same time taking a rap at the sala- ries pald the members. However, he rays, it has been a great satisfaction to be on the board. He has been praised by President Hoover for the “large measure of public service rendered,” and_will soon become vice president of the Marine Midland Corp., of New York. SOUND FILMS AID PICTURE INDUSTRY Hundreds of Patents and Licenses Involved in Com- plex Trade Situation. Special Dispatch to The Star. NEW YORK, September 13.—The talking cinema has made the motion picture industry the most complex corporate machine in the world. Time was when the movies, in matters of control and management, were based on relatively simple contractual agree- ments., But today, says Dr. Franklin S. Irby, associate editor of Electronics, in announcing the results of a recent world-wide study, the industry is a vast international network of interlacing atent agreements and licensss, extend- ng in its influerfce to 57,000 theaters serving hundreds of millions of people in every center of population outside the jungles and deserts. Hundreds of patents, all based on applications of the vacuum or electronic tube, form the foundation of the talk- ing picture industry, a field in which American and foreign companies today have an investment stake variously esti- mated at $100,000,000. The names of the American Telephone & Telegraph Co,, General Eleetric Co., Western Electric Co., Siemens & Halske, the great German manufacturing organiza~ tion; the Radio Corporation of America, Allgemeine Elektricitats Gasellschaft, German company in which General Electric has a share; and the great Klangfilm, Tonbild Syndicate A.-G. (Tobis) and Kuechenmeister patent and finance combines of Europe figure prominently in the development of the talkies. German, Swiss and Duteh capital plays an important part in the world sound film situation. One outstanding agreement which ties in both American and foreign pro- ducers, manufacturers and exhibitors is that reached at the Sound Picture Conference in Paris last July by the Electrical Research Products, Inc., wholly owned subsidiary of the West- ern Electric Co.; the Radio Corporation of America and the Tobis and Klang- film interests. The First Agreement. History of the motion picture industry as a really important factor in business and finance, says the editor, dates back to the earliest licensing agreement on record. It was reached some time prior to the advent of the sound film between the American Telephone & Telegraph Co. and the Radio Corpora- tion. The General Electric and West- inghouse organizations participated in this agreement. Electrical Research Products (Erpi), signatory to the Paris conference sales and license pact, was formed to handle licensing of Western Electric sound paratus, and its licensees include Wi ner Bros.; Fox Film Corporation, Metro- j Goldwyn Pictures, Paramount, United Artists and others. R. C. A.-Photo- phone is an organization similar to Erpi, but is & wholly owned subsidiary of the Radip Corporation of America, with its licensees including R-K-O _Pictures, Pt..hm' Tiffany, Educational Films and others. In their Intemlt&m-l licensing agree- ments Erpi and R. C. A.-Photophone tie in with the world-wide sound pic- ture set-up such producing units as British and Domjnion Films of London, Braunberger-Richebe of France and the Paramount-owned Kane studio in Join- ville, France, all licensed by Erpi, and H. M. V. Gramophone, Twickenham Film Studios, British Lion Films, Brit- iish International Pictures, the Gau- mont Co. Gainsborough Picture: all R. C. A.-Photophone licensees, are Etablissement Jacques Haik, France Pathe Cinema, France, and S. A. Im- mobiliare Cinematographia, Italy. In Europe as in America, Dr. Irby points out, the foundation of the sound picture industry came through large electrical companies. These controlled a great number of patents covering tubes, amplifiers, electrical recording and other developments, without which there could be no talking cinema. These companies set up licensing machinery, which is dominated by the Klangfilm- Tobis - Kuechenmeister groups. They effected agreements with the American licensing units, and the result is an in- dustry which blankets the world. European Groups. ‘The Kuechenmeister combination was formed as a holding company in 1928 by the banking house of Oyens & Sons and represents one of the earliest patent pools in the European field. Talking machine and phonograph disc manufac- ture, as well as radio, are elements in the Kuechenmeister set-up, which has its financial center in Holland and its manufacturing center in Germay. This groups owns about 26 per cent of the Tobis capital stock. Another 30 per cent of the Tobis capital is held by a Ger- man banking syndicate under the Com- merz and Privatbank. Tobis, founded with German, Swiss and Dutch capital, consolidates 500 sound-picture patents, builds reproducing apparatus and has an agreement for the sale of German domestic pictures and sound-film appa- (Continued on Third Page.) of deepening depression in neighboring European markets which normally con- sume large quantities of German ex- ports. Similarly, despite the recent highly timistic statement of the fi- nance minister on condition of fed- eral finances, the institute prophesies this year's deficit will pgakhi §1 . o 5 . CANADIN PREWER OF PUBLWORKS Bennett Acts to Cut Down List of Unemployed in Dominion. CURTAILED PURCHASING DELAYS TRADE RECOVERY Railroad Head Points to Surplus Goods as Chief Busines Problem, BY JOHN F. SINCLAIR. Special Dispatch to The Star. NEW YORK, September 13.—The ynew Prime Minister of Canada, R. B. Bennett, has lost no time in asking the House of Commons for $20,000,000 to spend on public works and construction to aid the unemployed. He proposes to build wharves, bridges and roads, as well as to help the provinces in local work. And he wants the money right away. In addition, his government is intro- ducing amendments to stop foreign sur= pluses being dumped in the Dominion, and thus “give employment to another 25,000 men.” Thornton’s Views. A day or two ago I asked Sir Henry Thornton, president of the Canadian National Ratlroad, for his views of the business situation. “During the war, production in prac tically all countries was excited to its maximum to meet the requirements of military operations and the destruc- tion caused thereby,” said Sir Henry “Enormous numbers of motor lorries were built, a large tonnage of iron and steel was necessary for arms, projec- tiles, war vessels -and the replacement of mercantile ships sunk by submarines. Food stuffs, fabrics, rubber supplies, medicines, chemicals and, in fact, all forms of production were in great de- mand. In many countries private in- dividuals were encouraged to estab- lish manufacturing plants. In some cases these plants were subsidized by the state. “After the war production con- tinued to be maintained for the re- habilitation of devastated areas and the replacement of various things which the results of the war neces- sitated. It is true that some so-called “war babies” went out of existence, but many individuals, who had put their brains and money into plants, turned these plants into the production of articles required in times of peace. This meant a continuance of employ- ment, with good wages to workers and d!llvmndxlw pmpfletzgn.bm mass of the people being thereby pros bought Punly. which also wnm to production, and this situation con- tinued for several years. Individuals having plenty of money not only pur- chased generously, but were attracted to the stock market, the result being the progressive increase in the stock market value of shares and securities. “Eventually, however, production ex- ceeded consumption, prices commenced to soften, and one fine day, under pressure, the stock market blew up. This revealed the true state of affairs and production immediately began to liquidate. In short, the present situ= ation was caused fundamentally by production exceeding consumption, and we shall not have a restoration to normal business conditions until a bal- ance is struck. How long this will be hardly any one can predict with any degree of certainty, but I should think it would be rather shorter than longer ow. # “As far as Oanada is concerned, there is nothing organically wrong with this country. We have the same produc- tive soil, the same water powers, the same mineral resources, the same | manufacturing plants and the same courageous, people that we had 18 months ago. “In Canada our difficulty largely arises from the inability of our customers to purchase on a generous scale. Canada is, and must be, es- sentially a selling and marketing country. If we relied upon the home consumption provided by 10,000,000 ple, our ecconomic position would very difficult. The prosperity of this country depends very largely on how much of our production can be sold abroad. So that whatever the business congdition may be at the moment in Clnada, it is caused by the repercussion of business conditions else- where. I think our situation is generally better than in most countries, but we are so involved with our customers abroad that we are not likely to have a complete return to normal conditions until our markets are restored.” Sir Henry estimates that the gross revenues of . the Canadian National Railroad for the last quarter of 1930 will be 4 per cent less than for the same period . of 1929.. He believes this also represents fairly well the general trans- portation situation in Canada. German Election, Today the German people are busy— more than 20,000,000 of them-—select- ing new members of the Reichstag in what is probably their most critical national election since the close of the great war. A confused political situation exists, Not one of the more than 20 parties is expected to have a majority. A com~ promise government is in prospect. So it's difficult to say which one will con= trol the new Reichstag, although a So= clalist-Bourgeois looks to be the most likely ottcome, led by Dr. Joseph Wirth, former chancellor, and Chancellor Bruening, at present German dictator. Should the make-up of the new Reichstage be of a moderate tinge, Ger- man credit throughout the world will naturally be looked upon with moré favor by the banking groups. Germany—her banks and corpora- tlons—owe to the United States citize: and corporations about $4,500,000.000 in short-time loans. Many of these loans will soon mature. Some already have. Should the political outcome today be considered favorable to the business in- terests, the next step will be to re- fund the short-term obligations into long-time obligations. Should the more radical groups, either of Hitler or Hugenberg, gain con- trol, the tendency, undoubtedly, will be to delay such refunding and make Germany’s financial and business po- sition more difficult and confusing. It's an election charged with very far-reaching consequences. And the outcome will be watched in every pa- tion in the world, but particularly in Great Britain and the United States. F. Edson White, president of Armour & Co., believes that the last quarter of 1930 in the meat industry will exceed the last quarter of 1929, lower com- modity prices being largely responsibi In the general business outlook Mr. ‘White considers hesitancy caused by { fear as besically the trouble now that business recovery. Foonremnl? 5360y oot e ewa- ; paper g PUSHING PROGRAM